Mark Moss explains how eight central banks formed the London Gold Pool in the 1960s to keep gold pinned at $35 per ounce by flooding the market with supply. By March 1968, panic buying overwhelmed them: withdrawals jumped from 5 tons daily to over 1,000 tons a week. On March 14, the pool collapsed.
And then 8 of the most powerful central banks on Earth— I'm talking about the US, the UK, West Germany, France, Switzerland, some other big banks— they formed a cartel to stop this. It's called the London Gold Pool. Now, the job, the entire job of the London Gold Pool was to keep the price set. The job was to defend the $35 peg. So if somebody buys too much gold, then the pool would sell into it. They'd knock the price back down. Sound familiar? They would coordinate the official supply. They would deploy to hold a price where the paper says it should be. But then finally, governments again started waking up to this, and they started demanding the physical gold. They didn't want the paper anymore. They knew the game that was being played. So on a normal day at the London fixing, about 5 tons of gold changed hands. By mid-March 1968, we saw the market start to call its bluff, and they started pulling about 200 to 330 tons out the door. In a single day. And in the final week, we saw over 1,000 tons gone in a single week. Now, all of this happened— central banks were sitting there watching, and they're watching their vaults get drained in real time. And so finally, on March— on March 14th, they hit the limit.
