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GATA Presents New Evidence Of The Fed's Gold Price Supression Scheme, Combing Through Oddly Unredacted FOMC Minutes

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Sun, 03/14/2010 - 19:39 | 265297 SWRichmond
SWRichmond's picture

Sitting here drinking so please bear with me: http://www.slyfoxbeer.com/index.php/front/beer_incubus

CHAIRMAN GREENSPAN. The Federal Reserve Bank's basement is a foreign country. When they move it out of the basement into the United States, it's an import. Then, when they ship it out again, it's an export.

MR. KELLEY. Does it have to get out of your vault at all in order to be considered an import and an export?

Obviously, the gold is considered too valuable to be frequently moved, let alone put at risk on a ship to move it internationally.  These guys seem to preferentially move it via accounting.  I want to believe it's allocated and not some damned pool account, ya know?  I'm fairly confident that these central banksters are anal about accounting, and that is one reason why they don't want an audit: the paper trail would be totally revealing.

The banksters obviously understand the importance and value of gold, and the importance and need for a currency's perceived value coming from its' being backed by....something.  This is also revealed by all the anti-gold rhetoric that constantly flows from official quarters.  It makes sense, then, to take Marc Faber's (paraphrased) advice to heart: become your own central bank by buying some physical gold regularly.

 

Sun, 03/14/2010 - 19:37 | 265298 Anonymous
Anonymous's picture

Instead of selling gold, the Fed should have been BUYING !

After the US$ collapsed in a couple of years, the US will have only a minor position in the IMF due to lack of reasonable gold reserves.

Russia, India, China are loeading up, everybody else is at least holding on to its reserves.

The US leaders are glueless and without any vision for their country. This stupidity must be stopped, they are looting their own country and should be jailed for counterfiting & treason.

END THE FED.

END THE SEC.

They are all are incompetent morons.

Sun, 03/14/2010 - 21:42 | 265412 WilliamShatner
WilliamShatner's picture

I'm still supicious about all these "sell your old gold" commercials on TV.

Wouldn't surprise me in the least bit if the buying party at the end of the line is the US Treasury and/or Federal Reserve.

Sun, 03/14/2010 - 23:48 | 265502 Hansel
Hansel's picture

I've pondered the same thing.  I envision it as a CIA operation when I don my tinfoil hat.  I think it falls in the same league as Operation Mockingbird.

http://en.wikipedia.org/wiki/Operation_Mockingbird

Mon, 03/15/2010 - 10:18 | 265754 Hephasteus
Hephasteus's picture

It's definitely fed and central bank. I pissed one of them off big time.

Sun, 03/14/2010 - 23:49 | 265504 swamp
swamp's picture

They leased the gold to suppress the price to save their fiat scheme but privately, my bet is that these dogs bought gold, and sold OUR gold, belonging to We The People, from Fort Knox, then stuffed it with tungsten.

Last I heard, these dogs recently refused to return Germany's gold. 

Sun, 03/14/2010 - 19:39 | 265300 Anonymous
Anonymous's picture

we are so screwed.

Sun, 03/14/2010 - 19:39 | 265301 doublethink
doublethink's picture

 

So How Do We Fight Back?

 

If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods.   --Alan Greenspan

 

Sun, 03/14/2010 - 19:41 | 265304 Anonymous
Anonymous's picture

+1

Get your money out from the bank and buy gold bullion.

My point, and done already !

Sun, 03/14/2010 - 23:27 | 265483 wake the roach
wake the roach's picture

If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods.

 

That brings up an excellent argument against pm's. There is not enough supply to provide even the US population with enough physical to become trusted as a claim on goods and as we all know, trust means everything.

When the collapse comes 95%+ of the population are not going to have any exposure to pm's and when there credit cards no longer work they will be more interested in eating than protecting their monitary wealth so how can anyone conclude that in the future, gold will have an equal or greater purchasing power than it does today relative to dollars?

Lets say all value or trust in dollars has failed so golds value no longer has any relative value. If the vast majority of people own no pm's and have no price history, how is the 3% of the gold owning population going to convince the layman that an ounce of gold would have once bought 20000 roast chickens so 10 chickens for an ounce is a good deal?

Gold works under the same old rules in a game of who's the greater fool. Considering that 95% of people wont see any  real value in precious metals, who's gonna pick up the demand?

Sun, 03/14/2010 - 23:52 | 265505 swamp
swamp's picture

Expand your horizons and think globally.

Second, ever try carrying around a bushel of wheat?

Mon, 03/15/2010 - 00:16 | 265516 wake the roach
wake the roach's picture

Think globally? Ok how about this... 5 950 000 000 people probably wont own gold compared to 50 000 000 who do... Is that global enough for you.

How are all those billions of people that now have ZERO purchasing power going to inflate your golds value...

So I guess that you your pinning all your hopes on the world  heading back to horse and buggy days of a gold standard?

Please, let me know how that works out for you ok?

Oh, and why would I be trying to trade a bushel of wheat? I can assure you that if I had a bushel of wheat, I would probably "invest" it by baking bread or by feeding it to my cattle, chickens or whatever and guess what, I wouldn't trade you one lousy lice ridden chicken for all your pretty  gold.

Mon, 03/15/2010 - 00:35 | 265526 Anonymous
Anonymous's picture

You are absolutely right, WTR. So many people on ZH don't seem to grasp this.

Mon, 03/15/2010 - 02:08 | 265574 faustian bargain
faustian bargain's picture

Grasp what? That gold will always be desirable as a store of purchasing power? I will stand by that concept, especially when the price manipulation (i.e. the dollar) loses effectiveness, which it will.

Mon, 03/15/2010 - 05:45 | 265624 i.knoknot
i.knoknot's picture

i'm not a hard-core gold-bug... only slightly afflicted, to take this as you may:

if 5 billion people were lose their (fiat based) purchasing power... (deflationary), what the hell currency/investment are they going to trust going forward? paper?

ask any weimar experienced german if they *like* paper money.

keeping the dialog useful, you may be right about the immediate effect of "nobody wants or can afford your gold...", but as things recover, the urge not to be burnt again may strengthen the argument for gold. until we all forget again and trust paper money again... heh...

Mon, 03/15/2010 - 12:38 | 265898 Attitude_Check
Attitude_Check's picture

The answer is VERRRRY simple -- even for you to understand.  The price of Gold increases suffciently, that very little is needed for the "average person" world-wide, say 1 gram.  Since a troy oz is approx 31 grams, and using 6Billion people for the world population, that would require approx. 192 B g's.  Arcording to Wikipedia that is just 1/24 th the total ammount of Gold world-wide.  If instead you assume that the world goes back to some kind of Gold standard, assume $55T world-wide GDP, and a money velocity of 2, then Gold price would need to be approx $12,000/toz to cover the worlds GDP's using all of the Worlds Gold.  This would be approx $400/g.

I'm not saying I predict this to occur any time soon -- or even ever.  The the simple fact is, if the price of Gold rises enough then the problem is solved.

The answer to your question is the 5 950 000 000 people become much poorer, and the folks who have the gold will buy the assets of the people who presently own them, and begin paying workers in g's of gold.  This kick-starts a gold-based economy.  It's really not hard to figure out.

It would be HUGELY disruptive to the World economy however -- but I'm not sure any more disruptive then the present world-wide economic trajectory sadly.

 

 

Mon, 03/15/2010 - 00:14 | 265514 SilverIsKing
SilverIsKing's picture

Maybe, just maybe, the government will give people the opportunity to turn their FRNs in for new dollars that are backed by gold.  Of course the rate of exchange might be such that for every $50 in FRN, you would get one new dollar.  Gold at $1,000/oz currently might be worth $50,000/oz in new dollars.

In this scenario, wouldn't it be wise to hold some physical?

Mon, 03/15/2010 - 00:36 | 265527 wake the roach
wake the roach's picture

Maybe, just maybe, the government will give people the opportunity to turn their FRNs in for new dollars that are backed by gold.  Of course the rate of exchange might be such that for every $50 in FRN, you would get one new dollar.  Gold at $1,000/oz currently might be worth $50,000/oz in new dollars.

 

Yes your right, but that requires the ridiculous assumption that we're heading back to a gold standard. Also, you do realise that you just made the critical argument for why you should sell your gold...

Tell me, why would governments and central banks be selling gold for $1000+ ounce now only to exchange it down the road for whatever equivalent purchasing power in "new dollars"? Yeah, Soros and Faber have the right connections to do that but good luck for average Joe.

We are not going back to a gold standard. Todays dollars are backed by something despite what people believe and that is energy, mainly oil. Energy consumption that is not appropriately priced given its finite nature.

Tomorrows currencys will be backed by energy too, only this time its value will be determined by its carbon emissions and not by how much it costs to dig or pump out of the ground, there is a big difference I assure you!!!

What do you think global emissions trading is?

Mon, 03/15/2010 - 00:47 | 265535 SilverIsKing
SilverIsKing's picture

So then this is what we do.  I buy gold.  You don't.  I wish you luck.  You wish me luck.

Good luck.

Mon, 03/15/2010 - 00:58 | 265539 wake the roach
wake the roach's picture

So then this is what we do.  I buy gold.  You don't.  I wish you luck.  You wish me luck.

Good luck.

 

No, I would put it this way...

You trust the government but believe that they, and the central banks are complete idiots therefore you buy gold.

I don't trust the government and believe that they, and the central banks have an endgame therefore I don't buy gold.

Yes, to each his own... good luck ;-)

Mon, 03/15/2010 - 01:19 | 265551 faustian bargain
faustian bargain's picture

I am fairly confident their endgame depends on those 95% of people you claim are not interested in precious metals, not the 5% who are.

Mon, 03/15/2010 - 05:50 | 265625 i.knoknot
i.knoknot's picture

indeed.

but i also fear they'll simply divide and conquer...

take out the first 95% of the sheeple, then with their batteries freshly-charged... they shoot for the remaining 4.9 percent.

timing is everything...

Mon, 03/15/2010 - 10:55 | 265668 SWRichmond
SWRichmond's picture

wake,

I've seen this discussion play out many times before, even participated in it a few times myself.  One side ('A') is essentially betting on the staying power of central banking as an institution, and the obvious dishonesty and corruption that goes along with it.  Another side ('B') is betting that the system is so rife with dishonesty and corruption that it can no longer sustain itself, and so will be forced to evolve into something less dishonest.  One more side ('C') dispassionately reads a lot of history, sees that fiat currencies all fail, almost always in 100 years or less, and recognizes that gold is the time-proven means for moving wealth from one fiat regime to the next.

Side 'A' is composed of finance professionals, the wealthy, B schoolers, and their government sycophants, all of whom are completely (in)vested in the current status quo, and whom therefor have great vested interest in maintaining it.  Side 'B' is composed of that small contingent of awakened upper middle and middle class who see the target that's been painted on their foreheads by Side 'A'.  Side 'C' is detached intellectuals and financial professionals who think outside the box.

Yes, this is a setup for a class war; you have chosen your side, and we have chosen ours.  You have money to pay troops, and we have the force multiplier of being everywhere and nowhere, and also being the energy that makes your lifestyle possible.  If enough of us were able to wake up enough more, all we would have to do is take all of our money out of your banking system and stay home from work for a few weeks.  No shooting would be necessary.  We have seen the incredible dishonesty and corruption that is central banking, and we ain't standing for it anymore.

 

Mon, 03/15/2010 - 03:34 | 265599 nuinut
nuinut's picture

Oil is/has been cheap in FRNs because those FRNs have been exchangable for gold at a cheap rate.

Oil is very, very important. And so is gold. The Saudis have essentially been exchanging their oil for gold for many decades. Nixons ending of convertability of $ for gold in 71 sparked the oil and gold price events of the 70s, as the Arabs were not happy to be exchanging their oil for green paper, and so the back room deal to hold down the US$ price for gold was born.

I agree, we are not going back to a gold standard.

We will move to a new era, where physical gold is marked to market, and held as a wealth reserve. Fiat currency will remain as our transactional medium, but gold will reassume its role as the wealth asset. It will soon be clear to even the slowest of us that fiat never has and never will perform the store of wealth function.

I suggest anyone interested in these thoughts check out these very interesting posts, among many others, posted at http://fofoa.blogspot.com/

Hell, there are freaking heaps more, and they are all worthwhile.

You make a good case, Roach, but if you don't understand these concepts, you are not seeing the larger gold situation.

Mon, 03/15/2010 - 03:57 | 265604 PaperWillBurn
PaperWillBurn's picture

Worthwhile is an understatement. They are all a MUST read

Mon, 03/15/2010 - 01:17 | 265549 faustian bargain
faustian bargain's picture

no no no, obviously you don't get it: ya cain't eat gold, hyuk hyuk. People ain't interested in being able tuh "buy" stuff, they jist want tuh eat some chickins.

[/sarcasm]

Mon, 03/15/2010 - 02:00 | 265569 wake the roach
wake the roach's picture

I'm only using chickens as an example of something to compare value too once a currency is worth zero but you know that...

So what you got against chickens and hillbillys anyway? Did they touch you in secret places faustian bargain?

No, your just pissed off because your scared that the ZH minority group may actually have valid arguments, thus revert to sarcasm, typical of a schoolyard bullys... 

So tell me smart ass, whats the purchasing power of gold relative to, um... nothing at all???

Or whats the "true value" of this mystical gold that cannot be printed therefore is real money that I keep hearing so much about?

So ok, not in chickens but oh lets say, ummm. I-pods or even banjo's?

How many I-pods or banjo's can I "buy" per ounce  of Au at its real God given cosmic value???

 

 

Mon, 03/15/2010 - 02:18 | 265579 faustian bargain
faustian bargain's picture

I dunno, I don't have any ipods or banjos to sell you, so you can't have them from me at any price.

The purchasing power of anything is zero when compared to nothing at all. But then you'd have to be living in an uninhabited vacuum.

I'm not sure where you get this idea that gold has to have some mystical intrinsic cosmic "value". I never said that, I don't think anyone else here has said it either. It's just desirable as a thing to save and trade for stuff, therefore it has whatever value the market will bear.

I'm betting the market will go one way, you seem to be betting it will go another.

I'm not going to lay out all the reasons PM's make great currencies here, since that info is readily available on the web.

But barter is good, too. Maybe I'll trade me some eggs for one-a them i-pads, so I can read up on Keynes on the interweb.

Mon, 03/15/2010 - 02:19 | 265581 faustian bargain
faustian bargain's picture

Actually I'm not betting very much on gold. I don't have much to bet, so I'm sorta screwed either way. *shrug*

Mon, 03/15/2010 - 05:02 | 265616 Anonymous
Anonymous's picture

We're on a rock in outer space brother( no offense roach) we're all screwed. on a long enough timeline...

Mon, 03/15/2010 - 12:43 | 265906 Attitude_Check
Attitude_Check's picture

I think FRNs are YUMMY -- pass the ketchup please.  I especially like the $100 bills, they are SOOO much yummier and more filling!

Sun, 03/14/2010 - 19:40 | 265302 Anonymous
Anonymous's picture

Buy PHYSICAL GOLD BULLION. NOW.

Sun, 03/14/2010 - 19:51 | 265309 Anonymous
Anonymous's picture

Frontrunning China and buying gold right now is actually just what I like to do. I could imagine they dont see this fast spike in the price coming and will be forced to speed up their own aquisition program.

India has no own gold production and will do what it can to get hold on the remaining IMF gold.

There is no way to stop the price rise now due to the shortage of sufficient & available quantities for central banks.

Its funny to see how governments in many countries are asleep, while the wide public wakes up and protects their private assets and wealth in bullion.

Its the chance of a life time !

Sun, 03/14/2010 - 19:56 | 265315 h4rdware
h4rdware's picture

That dialog reads like something out of a Lewis Carroll book. I was fully expecting one of them to start making up puzzles or talking in reverse, or solving interest rates by pulling gold bars out of each others asses.

Somebody mark them and their fantasy world zero before this gets out of control.

Sun, 03/14/2010 - 21:01 | 265371 MsCreant
MsCreant's picture

 

That dialog reads like something out of a Lewis Carroll book. I was fully expecting one of them to start making up puzzles or talking in reverse

You made me laugh!!! Greenspan looks like a cartoon character, no doubt.

Sun, 03/14/2010 - 21:17 | 265384 Nathan Smith
Nathan Smith's picture

Greenspan looks like a cartoon character, no doubt.

 

Indeed the Maestro is Mr. Magoo.....too bad I can't post a pic.

Sun, 03/14/2010 - 19:57 | 265318 goldfreak
goldfreak's picture

Take advantage of Cartel attacks to buy.

Sun, 03/14/2010 - 19:59 | 265319 Anonymous
Anonymous's picture

The possible switch to hyperinflation is not a economic one but a currency event. The total loss of confidence in the US will be the trigger. And this can happen very fast, in hours or a just day.

What that particular trigger will be is yet unknown, but there are too many pending disasters awaiting that it must accepted as a given now. It will happen in the not too distant future.

Does anybody believe the US have a any good standing in the wolds eye ?

Buy your gold bullion now. Not soon or later, but right now.

Thank me later.

Sun, 03/14/2010 - 20:20 | 265342 Hansel
Hansel's picture

This is a majorly awesome gold article.  I just came here after finding this article on GATA to post in the comments, and then email tips@zerohedge... but there it sat as the top story.  :)

Sun, 03/14/2010 - 20:21 | 265343 Bob
Bob's picture

Adrian Douglas has just catapaulted into the role of Jack's smirking revenge . . .

What a weekend this has been!  Now we find out if there's any redemption to be found in this empty charade of a "financial system."  

Time for the Fed to go down.

Sun, 03/14/2010 - 20:23 | 265346 assumptionblindness
assumptionblindness's picture

So this is what it feels like to be the fly on a wall.  Great stuff!

Sun, 03/14/2010 - 20:45 | 265347 THE DORK OF CORK
THE DORK OF CORK's picture

Greenspan seems to lose his talent for speaking in riddles when he attends FOMC meetings

What would the dynamic duo make of this little puzzle I wonder

 

http://www.youtube.com/watch?v=Pp_9FEWgmFA

Sun, 03/14/2010 - 21:01 | 265370 Hansel
Hansel's picture

From Alan's 2007 60 Minutes interview:  http://www.cbsnews.com/stories/2007/09/13/60minutes/main3257567_page5.sh...

"... in public Greenspan was inscrutable whenever Congress asked about interest rates. He resorted to an indecipherable, Delphic dialect known as "Fed-speak."

"I would engage in some form of syntax destruction, which sounded as though I were…answering the question, but, in fact, had not," Greenspan admits, with a chuckle.

At one hearing, Greenspan said, "Modest pre-emptive actions can obviate the need of more drastic actions at a later date, and that could destabilize the economy."

"Very profound," Greenspan says, after listing to his testimony.

Greenspan personally worked on these "profound" comments.

"But what would often happen is you'd get two newspapers with opposing headlines, coming out of the same hearing," Stahl remarks.

"I succeeded. I succeeded," Greenspan says."

 

Sun, 03/14/2010 - 21:31 | 265400 THE DORK OF CORK
THE DORK OF CORK's picture

The most powerful statist in the history of America was a virulent anti-statist - you could not make this stuff up - the internal contradictions of Greenspan and indeed many Americans on the role of the state is at the root of this crisis.

Whatever your politics to believe in promoting people to a role of authority which they have a ideological belief in destroying is madness squared or even cubed.

At least historians will be glad of the paper trail that the esteemed chairman left but they will have to work overtime to find something relevant amongst all those FRNs that will clog the system.

Sun, 03/14/2010 - 22:58 | 265461 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Stahl wore a phat gold chain every interview.  RESPECT!

Mon, 03/15/2010 - 02:05 | 265572 CombustibleAssets
CombustibleAssets's picture

"

I guess I should warn you, if something I've said seems to be particularly clear, you've probably misunderstood what I've said. " - Alan Greenspan

Sun, 03/14/2010 - 20:32 | 265348 Anonymous
Anonymous's picture

Reading a lot of the commenters here I will invest in aluminum foil companies heavy.

Mon, 03/15/2010 - 01:22 | 265552 faustian bargain
faustian bargain's picture

that won't do you much good because it's got to be tin.

Mon, 03/15/2010 - 02:45 | 265593 Anonymous
Anonymous's picture

You and me both. Gold might go up at some point but it ain't gonna be caused by this "earth-shaking" news. And even if it does go up over time, the bugs will never know when to get off the bandwagon...i guarantee that 95% of those who ride it up will ride it all the way back down again.

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