Quote from: twiifm on February 08, 2015, 04:07:09 PM

Quote from: dinofelis on February 08, 2015, 05:00:54 AM

Quote from: twiifm on February 08, 2015, 04:02:56 AM

This theory is bunk. I'd like to see just one historical example where this has happened.

On the contrary. Central Banks (FED) sell gold when it is cheap, and buy gold when it is expensive, which makes them make "losses" which don't matter as they print the money.

As such, they amplify the prices in the markets, to go against the speculators/investors gains (except for those in the knowing).

Gold exchange funds buying gold:
1997 0
1998 0
1999 0
2000 0
2001 0
2002 3
2003 39
2004 133
2005 208
2006 260
2007 253
2008 321 <- buying at low prices
2009 617 <- buying at low prices
2010 367.7 <- buying less at somewhat higher prices
2011 154.0 <- even more
2012 279.1 <- again somewhat more
2013 -880 <- selling
2014Q12 -42.5 <- selling at even higher prices

FED:

1997 $330.98 326 selling at low prices
1998 $294.24 363 selling at low prices
1999 $278.88 477
2000 $279.11 479
2001 $271.04 520
2002 $309.73 547
2003 $363.38 620
2004 $409.72 47
2005 $444.74 663
2006 $603.46 365
2007 $695.39 484 selling at low prices
2008 $871.96 235 speculators try to buy, so let's sell less too to counter them
2009 $972.35 34
2010 $1224.53 -77 higher prices, so let's buy instead of selling.
2011 $1571.52 -455 even higher prices, so let's buy even more.
2012 $1668.98 -544.1 peak buying
2013 $1411.23 -409.3 speculators start selling, so we shouldn't buy: lowering buying.
2014Q12 $1294.64 -242.1 counter the speculators trying to sell by buying less.

FED does identical movement as speculators and hence counter-acts them, increasing prices when they try to buy, and lowering prices when they try to sell.

Gold in metric tons.

Why is this considered buying up the entire economy?

This is not "buying up the entire economy", this is "distributing seigniorage to friends" and causing volatility in the gold market (so that it can serve less as a safe store of value).

There is absolutely no good reason for a central bank to *increase* asset volatility, if it isn't to have "friends" profit from it, an to render the asset less secure as a store of value.