Glencore IPO Could Blow The Doors Off Precious Metals Prices

As far as I know, nobody is covering this story from this angle yet. Glencore is a Swiss-based and privately owned commodities trading firm. They are known for being super secretive and damn good at making money. This week they will go public in a massive 12 billion dollar IPO based with shares set to trade in London and Hong Kong.

So whats so special about this? I have written extensively on how the Federal Reserve and US markets have been using every trick in the bag to knock down the price of gold and silver. Well that’s all possibly about to change and Bernanke and his buddies are probably having some sleepless nights right about now.

You see, as the Fed has continued printing money like a child with a photocopier, they have encountered an annoying problem. If there is a set amount of gold and silver in the world, but you increase the amount of paper bills in circulation, it drives the value of the precious metals up. This is basic logic because you have a higher dollar-to-gold ratio. Even though we are no longer on the gold standard, it doesn’t matter. More dollars, chasing the same amount of metal makes the metal worth more.

​Well the Feds little manipulation party may finally be coming to an end. Glencore is not subject to the manipulation and regulation of the US market. If you are a commodities investor, you may now take a moment to do a victory dance around your living room before continuing.

If Glencore is smart, and I think they are damn smart, they would bet and call long for physical delivery on precious metals. All US commodities firms that are artificially holding the market down by betting short on futures contracts in gold and silver will be wiped out. Once the US market is forced to admit they don’t even have enough gold or silver to cover there contracts, gold and silver will climb like a rocket. This would make Glencore and anyone else who believes in the fundamentals of precious metals very rich indeed.