SGM Metals: Demand for Gold Trading in Italy Brings New Bullion Trading Platform

July 17, 2012 - PRLog -- Reuters reports: [ (Reuters) - Italpreziosi, Italy's leading precious metals trading and refining company, and on-line broker Directa have launched a platform for trading gold bullion, prompted by increasing Italian interest in investing in the metal.

Italians have traditionally favoured gold jewellery as a safe haven, but new instruments such as bullion and exchange-traded funds (ETFs) have recently been gaining popularity.  A 15% annual rise in euro-denominated gold prices by mid-July also added appeal to bullion.

With the new Physical Gold Platform (PGP), clients of 180 banks working with Directa will be able to buy on-line gold bullion of various sizes provided by Italpreziosi, the two companies said in a statement on Friday.

The companies do not plan to launch futures trading, at least in the short term, Italpreziosi head Ivana Ciabatti said. About 15 banks have already joined the project, but it is too early to forecast trading volumes, she said. Prices will be based on cash market quotations and continuously updated.

Italpreziosi's revenues jumped 72.6 percent to 1.134 billion euros ($1.4 billion)in 2011. Directa works with more than 180 banks, which together have more than 3,400 branches across Italy. ($1 = 0.8208 euros) (Reporting by Svetlana Kovalyova, editing by Jane Baird)]

Demand for alternative investments that are designed by nature to hedge against the inflationary policies of the printable paper dollar western banking system have resulted in Italy establishing physical gold bullion trading platforms. Unfortunately the “Wall Street Boys” have imbedded a trojan horse into this development through the unveiling of an exchange traded fund. This trojan horse is designed to trick those who have identified the need for alternative currencies to hedge against fiat dollar inflation that will be the result of the ‘bailing out’ of European nations. These precious metals derivatives will redirect a portion of those euros that would drive the precious metals up in price into a paper derivative investment that does not benefit the actual price of bullion but instead suspends those investing dollars (euros) in a paper investment.

Stated differently, if $1 billion was moving into physical bullion and as the investors were pulling their monies out of their stock portfolios the broker suggested they utilize these precious metals derivative ETFs instead of buying ‘bulky bars of metal’ then the $1 billion that would have gone into the physical bullion market and driven the prices dramatically higher would be in effect cut in half. This would make the appreciation of gold & silver prices not directly reflect the true level of concern in the investing community regarding the stability of the global economies, thus deceiving those who are trying to establish a legitimate bearing on the level of concern. This causes a wild distortion in the perception of the level of fear and is directly responsible for the illusion that investors aren’t as worried as you would expect them to be. This serves a dual mandate, to use a federal reserve term, in that it mutes by a wide margin the true level of fear as well as the free market appreciation of the precious metals. It also serves to prolong the viability of the inflationary fiat dollar system solutions such as bailouts and stimulus that have been implemented up to this point, thus permitting them to go back to the well and reapply these same inflationary policies time and again. The real damage is being done by not permitting the true free market reaction of gold & silver bullion prices to the inconceivable volumes of trillions of newly printed dollars the world has been flooded with since the onset of the housing crisis in 2008. While this phenomenon has annoyed many metals advocates, it has not changed the free market consequences that have been the effect to the cause of inflationary policies throughout history. This distortion of the free market is only setting the stage for a world changing moment when the precious metals break free of the paper derivative distortion that has kept them modest in their performance comparatively to the volume of paper money printing that has occurred since the global currency war began.

Do not get frustrated with the relatively modest gains in the precious metals as they will in time force a free market correction that will undo decades of suppression that has permitted this fiat fractional reserve monetary system to expand exponentially without a hard asset conscience that traditionally would rise without interference and keep central banks honest. Just because the free market conscience has seemingly been muted up to this point doesn’t mean it is no longer applicable, because it is. When it re-emerges to make its perspective known it will bring with it an immediate failure of confidence that will make the staunchest paper money stock market advocate turn into a child looking for his blanky complete with his thumb in his mouth. This will be the point where those who have wisely and timely moved a portion, if not all, of their assets in to the precious metals will not only be hailed as a genius who saw the free market shift coming, but will also be the moment that their assets multiple exponentially. Accept that every nation (EXCEPT THE US, BECAUSE WE ARE BORROWING MONEY TO SIMPLY PAY THE INTEREST ON THE NATIONAL DEBT TO THE CENTRAL BANK AND PROPPING THE MEGA BANKS UP WITH OUR MONEY) has been buying hundreds of metric tons of gold in preparation for this free market shift at break neck speeds. If gold was such a stupid asset purchase why would every other nation be preparing for the day of reckoning for the dollar by doing just that? The truth is that those who are responsible for the dollar policies are hoping they will be able to artificially restore confidence in the dollar to avoid this eventuality, and the rest of the world is preparing for the possibility that they may be unsuccessful in their efforts. Shouldn’t you take a page from EVERY OTHER COUNTRIES play book on the planet and do the same?

At this point we have a presidential election coming in roughly 4 months and in order to get re-elected it would be safe to assume that a little ‘sugar high’ in the economy couldn’t hurt the cause. This all but assures us that there is a very high probability that the FED will shortly announce QE3 or some variation of it in order to create this much needed ‘blip on the radar’ that can be sold as proof of the recovery that supposedly started back in June of 2009. Without the ‘signs of growth’ such as unemployment dipping into the 7% range and maybe a slight boost in consumer spending created by inflation what is there to point at to say “look, its working, let me finish what I started, give me another crack at it”? Having said that it seems all but guaranteed that we will soon get blessed with more FED money printing since the ECB caved in and agreed to bailout Spain & Italy at the same time the BOE announced a heavy stimulus program and this will create unspeakable volumes of newly printed paper money for these economies. After the FED admitted that the S&P 500 would be 1/2 its current value had it not been for federal reserve wordmanship that has driven investing dollars into the game in anticipation of their next play are you really in a good market with your investing dollars? Establish your “Plan B” in physical gold & silver bullion because it is a much better play to PREPARE your portfolio than it is to try and REPAIR your portfolio in an investing environment such as we have today.