Besides the historic accumulation of gold by countries such as Russia, China, and India over the past four years, and increased speculation in the precious metal by billionaires and well known hedge fund managers, there is another element to add the to the mix that could soon be tightening supplies and driving up prices.
In an interview with SGTReport on June 12, the CFO of MX Gold Corp is joining in with others in the mining industry to hold back between 20 and 30% of their gold output from the market, and stockpile it until prices rise to a more equitable fair value in or out of the Comex.
For years, the Commodities Exchange (Comex) and the London Gold Fix have manipulated and suppressed prices in order to protect paper currencies in the U.S. and Europe, and this has led to an environment where it actually costs mining operations more to take it out of the ground than the price they receive from mints or refiners.
MX Gold Corp CEO Akash Patel and CFO Kenneth Phillippe say that they are positioning their company to stockpile between 20% to 30% of their physical gold production in coming months, noting that prices are nowhere near where they should be at current supply and demand levels. In an interview with SGT Report, Phillipe appears to be taking the stance of many precious metals investors, which is to stockpile the physical asset in anticipation of any number of potentially cataclysmic economic and monetary events like the hyperinflation we are witnessing in Venezuela.
We want to pull out the physical gold… We want to take this gold and we want to store it. We believe that having the physical gold in the vault makes a lot more sense than selling it at these prices. Gold is ready to move. We believe it’s going to continue to rise… we’re going to be storing our gold and holding it for the long-term. - Shtfplan.com