It can't be a great feeling when the stock price of the company you work at rises when you announce that you're leaving. But such was the lot of the CEO and the Chairman of gold miner Newcrest this week. Australian's biggest gold producer is grabbing the broom and sweeping out the dirty closet. It's been a tough year. It might get even tougher for the gold juniors.

The lacklustre gold price is the main culprit. The yellow metal is showing no signs of perking up in a manner to which, some might say, we've become accustomed.

Not even news that those pesky big banks sound like they've been up to their old tricks again could put some fire under it. The Swiss came out this week and said they were looking into possible rigging of major benchmarks in the foreign exchange market. FX has a turnover of $US5.3 trillion a day. This isn't chicken feed we're talking here.

Take this little snippet from The Australian this week: 'Bank clients post orders to buy and sell certain currencies to banks in advance of fixes. One of the issues regulators may be looking at is whether some bank traders could trade ahead of their clients orders to profit from the fix...the Swiss probe brings to at least five the number of rates and benchmarks that are being investigated worldwide.'

Another market, another rigging. Such is modern finance. Of course, this story got mostly lost amongst the noise about the US government this week. But even the spectre of the dire US fiscal situation all over the market couldn't shake gold from its doldrums.

Anyone taking a position in physical gold is usually prepared to play the long game. But gold is looking vulnerable in the short term. That was enough for Dan Denning over at The Denning Report to put his readers on alert if they're in the gold juniors. Time is not a luxury that the junior gold miners have. Any further fall in the gold price, argues Dan, could be a killer blow.

The big miners won't have it easy either. We might yet see more asset sales and capital raisings. Not only that, you could argue that a falling gold price bolsters Dan's case for Australia to head into a recession in 2014. It's our third largest export after all.

Of course, we still think any discussion about gold should mention the shenanigans in India. In your Weekend DRback in August we speculated that Indian politicians would do gold no favours in the short term.

Why? India is the biggest market for gold on the planet. The government raised the import tax on gold to 10% and restricted the sale of bars and coins. They've also decided that a fifth of gold imported into the country must later be exported as jewellery. Enter confusion on the second point and a total killjoy on the first.

The Wall Street Journal reported last week that imports of the metal fell 90% in August and 'the import curbs had ramifications beyond India's borders and helped muzzle a large part of the global gold trade.' According to the article, refiners and traders in Switzerland and Dubai are feeling the slowdown. In September the value of gold imports dropped 82%.

This week The WSJ reported demand is starting to fire up as India moves into its festival season, usually a time forgold buying. But premiums are high and gold supply is short.

'"The demand is very strong. But there is no gold available," said Vasu Acharya, director of Parker Bullions, one of India's largest bullion dealers. Imports are enough to meet just about 10% of demand, Mr. Acharya said.'

Enter, of course, the smugglers. We remember back in August a reader writing to us reminiscing about his younger years in India. He lived off a black market currency scam. He said the Indians would quickly find a way around any restrictions and we had it the wrong way around suggesting the import restrictions would put pressure on the price.

We're not sure who's right on the last point. Gold has stayed down but who can really say why for certain? Your regular editor Greg Canavan argued this week that the price is set by the gold derivative market, not physical supply and demand. But our reader definitely wasn't off the mark with his prediction of the arrival of some creative deliverymen.

Dan Denning picked up the trail in Scoops Lane this week: 'In India, investigators from the Directorate of Revenue Intelligence discovered 32kgs of gold hidden in the bathroom of a plane landing at Chennai. The plane originated in Dubai. This follows the intercept of another 35kgs of gold moving across the mountainous border between Nepal and China last month.'

The traditional wedding season in India is in the northern autumn and the Hindu festival of Diwali is due in November. Will gold demand perk up? How much gold can get through? How long can these absurd restrictions stay? Hmm. We don't know yet. But we bet there's a few Aussie mining execs that wouldn't mind if Indian borders prove to be very 'leaky'. Stay tuned.

Regards,

Callum Newman+
for The Daily Reckoning Australia