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Tracking The Gold "Conspiracy" - GATA's Must Read Presentation To The Cheviot Asset Management Sound Money Conference

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Submitted by GATA

The Cheviot Asset Management Sound Money Conference
The Guildhall, London
Thursday, January 27, 2011

Most Americans will believe almost anything if it's said with a
British accent. I'm not here to ask you to return the favor, but rather
to consider some evidence, to be receptive to questions, and to start
asking some questions of your own.

In September 2009 Jim Rickards, director of market intelligence for
the Omnis consulting firm in Virginia, was interviewed about the
currency markets on the cable television network CNBC. Rickards
remarked: "When you own gold you're fighting every central bank in the

That's because gold is a currency that competes with government
currencies and has a powerful influence on interest rates and the value
of government bonds. This was documented in an academic study published
in 1988 in the Journal of Political Economy by Lawrence Summers, then
professor of economics at Harvard, future U.S. treasury secretary, and
Robert Barsky, professor of economics at the University of Michigan -- a
study titled "Gibson's Paradox and the Gold Standard":

This close correlation among gold, interest rates, and government
bond values is why central banks long have tried to control -- usually
suppress -- the price of gold. Gold is the ticket out of the central
banking system, the escape from coercive central bank and government

As an independent currency, a currency to which investors can resort
when they are dissatisfied with government currencies, gold carries the
enormous power to discipline governments, to call them to account for
their inflation of the money supply and to warn the world against it.
Because gold is the vehicle of escape from the central bank system, the
manipulation of the gold market is the manipulation that makes possible
all other market manipulation by government.

Of course what Jim Rickards said about gold was no surprise to my
organization, the Gold Anti-Trust Action Committee. To the contrary,
what Rickards said has been our premise for most of our 12 years, and we
have documented it extensively. But while the gold price suppression
scheme is a hard fact of history, it is seldom mentioned in polite
company in the financial world. So it is a thrill for me that everyone
here today is being so polite.

How have central banks tried to suppress the price of gold?

The gold price suppression scheme was undertaken openly by governments for a long time prior to 1971.

That's what the gold standard was about -- governments fixing the
price of gold to a precise value in their currencies, a price at which
governments would exchange their currencies for gold, currencies backed
by gold.

Though the gold standard was abandoned during World War I, restored
briefly in the 1920s, and then abandoned again during the Great
Depression, that was not the end of government efforts to control the
gold price. Throughout the 1960s the United States, Great Britain, and
some of their allies attempted to hold the price at $35 per ounce in a
public arrangement of the dishoarding of U.S. gold reserves. This
arrangement was known as the London Gold Pool.

As monetary inflation rose sharply, the London Gold Pool was
overwhelmed by gold demand and was shut down abruptly in April 1968.
Three years later, in 1971, the United States repudiated the remaining
convertibility of the dollar into gold -- convertibility for government
treasuries that wanted to exchange dollars for gold. At that moment
currencies began to float against each other and against gold -- or so
the world was told.

In fact since 1971 the gold price suppression scheme has been
undertaken largely surreptitiously, seldom acknowledged officially. But
sometimes it has been acknowledged officially, and with a little detective work, still more about the price suppression can be discovered.

You may have heard GATA derided as a "conspiracy theory"
organization. We are not that at all. To the contrary, we examine the
public record, produce documentation, question public officials,
publicize their most interesting answers, or their most interesting
refusals to answer, and sometimes litigate to get information. I'd like
to review some of the public record with you.

The official records

The gold price suppression scheme was a matter of public record in
January 1995, when the general counsel of the U.S. Federal Reserve
Board, J. Virgil Mattingly, told the Federal Open Market Committee,
according to the committee's minutes, that the U.S. Treasury
Department's Exchange Stabilization Fund had undertaken gold swaps. Gold
swaps are exchanges of gold allowing one central bank to intervene in
the gold market on behalf of another central bank, potentially giving
anonymity to the central bank that wants to undertake the intervention.
The 1995 Federal Open Market Committee minutes in which Mattingly
acknowledges gold swaps are still posted at the Fed's Internet site:

The gold price suppression scheme was again a matter of public record
in July 1998, six months before GATA was formed, when Federal Reserve
Chairman Alan Greenspan told Congress: "Central banks stand ready to
lease gold in increasing quantities should the price rise." That is,
Greenspan contradicted the usual central bank explanation for leasing
gold -- supposedly to earn a little interest on a dead asset -- and
admitted that gold leasing is all about suppressing the price.
Greenspan's admission is still posted at the Fed's Internet site:

Incidentally, while gold advocates love to cite Greenspan's testimony
from 1998 because of its reference to gold leasing, that testimony was
mainly about something else, for which it is far more important. For
with that testimony Greenspan persuaded Congress not to regulate the
sort of financial derivatives that lately have devastated the world
financial system.

The Washington Agreement on Gold, made by the European central banks in 1999, was another admission -- no, a proclamation
-- that central banks were working together to control the gold price.
The central banks in the Washington Agreement claimed that, by
restricting their gold sales and leasing, they meant to prevent the gold
price from falling too hard. But even if you believed that explanation,
it was still collusive intervention in the gold market. You can find
the Washington Agreement and its successor agreements at the World Gold
Council's Internet site:

Barrick Gold, then the largest gold-mining company in the world,
confessed to the gold price suppression scheme in U.S. District Court in
New Orleans on February 28, 2003. That is when Barrick filed a motion
to dismiss Blanchard & Co.'s anti-trust lawsuit against Barrick and
its bullion banker, JPMorganChase, for rigging the gold market.

Barrick's motion claimed that in borrowing gold from central banks
and selling it, the mining company had become the agent of the central
banks in the gold market, and, as the agent of the central banks,
Barrick should share their sovereign immunity and be exempt from suit.
Barrick's confession to the gold price suppression scheme is posted at
GATA's Internet site:

The Reserve Bank of Australia confessed to the gold price suppression
scheme in its annual report for 2003. "Foreign currency reserve assets
and gold," the Reserve Bank's report said, "are held primarily to
support intervention in the foreign exchange market." The Reserve Bank's
report is still posted at its Internet site:

Maybe the most brazen admission of the Western central bank scheme to
suppress the gold price was made by the head of the monetary and
economic department of the Bank for International Settlements, William
S. White, in a speech to a BIS conference in Basel, Switzerland, in June

There are five main purposes of central bank cooperation, White
announced, and one of them is "the provision of international credits
and joint efforts to influence asset prices (especially gold and foreign exchange) in circumstances where this might be thought useful." White's speech is posted at GATA's Internet site:

Two years ago a remarkable 16-page memorandum was found in the
archive of the late Federal Reserve Chairman William McChesney Martin.
The memorandum is dated April 5, 1961, and is titled "U.S. Foreign
Exchange Operations: Needs and Methods." It is a detailed plan of
surreptitious intervention to rig the currency and gold markets to
support the dollar and to conceal, obscure, or falsify U.S. government
records and reports so that the rigging might not be discovered.
Amazingly, this plan for rigging the currency and gold markets remains
on the Internet site of the Federal Reserve Bank of St. Louis:

In August 2009 the international journalist and provocateur Max
Keiser reported an interview he had with the Bundesbank, Germany's
central bank, in which he was told that all of Germany's gold reserves
were held in New York. That interview is posted at the YouTube Internet

Some people saw the Bundesbank's admission as a suggestion that
Germany's gold had become the tool of the U.S. government. GATA
consultant Rob Kirby of Kirby Analytics in Toronto then pressed the
Bundesbank for clarification. The Bundesbank quickly replied to Kirby by
e-mail with a denial of Keiser's report, but the denial was actually
pretty much a confirmation:

"The Deutsche Bundesbank," the reply said, "keeps a large part of its
gold holdings in its own vaults in Germany, while some of its gold is
also stored with the central banks located at major gold trading
centers. This," the Bundesbank continued, "has historical and
market-related reasons, the gold having been transferred to the
Bundesbank at these trading centers. Moreover, the Bundesbank needs to
hold gold at the various trading centers in order to conduct its gold

The Bundesbank did not specify those "gold activities" and those
"trading centers." But those "activities" can mean only that the
Bundesbank is or recently has been surreptitiously active in the gold
market, perhaps at the behest of others -- like the United States, the
custodian of German gold.

A few weeks ago the German journalist Lars Schall, at GATA's urging,
pressed the Bundesbank for clarification about the German gold reserves,
and particularly about whether the Bundesbank had undertaken gold swaps
with any U.S. government agency. Schall sent the Bundesbank 13
questions. But the Bundesbank brushed him off, even as it seemed to
acknowledge meddling surreptitiously in the gold market:

The Bundesbank replied:

"In managing foreign reserves, the Bundesbank fulfils one of its
mandated tasks as an integral part of the European System of Central
Banks. We trust you will understand that we are not able to divulge any
further information regarding this activity. Particularly with respect
to the confidential nature of information about where gold holdings are
kept, we are unable to go into any greater detail concerning exact
locations and the quantities stored at each of these. Likewise, owing to
the strategic nature of the activity, we are not at liberty to provide
you with more detailed information about gold transactions."

In 2009 a New York financial market professional and student of
history, Geoffrey Batt, posted at the Zero Hedge Internet site three
declassified U.S. government documents involving the gold market.

The first was a long cable dated March 6, 1968, sent by someone named
Deming at the U.S. Embassy in Paris to the State Department in
Washington. It has been posted at the Zero Hedge Internet site:

The cable described the strains on the London Gold Pool, the
gold-dishoarding mechanism established by the U.S. Treasury and the Bank
of England to hold the gold price to the official price of $35 per
ounce. The London Gold Pool was to last only six months longer.

The cable is a detailed speculation on what would have to be done to
control the gold price and particularly to convince investors "that
there is no point anymore in speculating on an increase in the price of
gold" and "to establish beyond doubt" that the world financial system
"is immune to gold losses" by central banks.

The cable recommended creation of a "new reserve asset" with
"gold-like qualities" to replace gold and prevent gold from gaining
value. To accomplish this, the cable proposed "monthly or quarterly
reshuffles" of gold reserves among central banks -- what the cable
called a "reshuffle club" that would apply gold where market
intervention seemed most necessary.

Of course these "reshuffles" sound very much like the central bank gold swaps and leases of recent years.

The idea, the cable says, is for the central banks "to remain the masters of gold."

Also disclosed in 2009 by Zero Hedge's Geoffrey Batt was a memorandum
from the Central Intelligence Agency dated December 4, 1968, several
months after the collapse of the London Gold Pool. This too has been
posted at the Zero Hedge Internet site:

The CIA memo said that to keep the dollar strong and prevent "a major outflow of gold," U.S. strategy would be:

"-- To isolate official from private gold markets by obtaining a
pledge from central banks that they will neither buy nor sell gold
except to each other."


"-- To bring South Africa to sell its current production of gold in the private market, and thus keep the private price down."

The third declassified U.S. government document published by Geoffrey
Batt at Zero Hedge in 2009 may be the most interesting, because it was
written on June 3, 1975, four years after the last bit of official fixed
convertibility of the dollar and gold had been eliminated and the world
had been told that currencies henceforth would float against each other
and against gold and that gold would be free-trading.

The document is a seven-page memorandum from Federal Reserve Board
Chairman Arthur Burns to President Gerald Ford. It is all about
controlling the gold price through foreign policy and defeating any free
market for gold. It has been posted at GATA's Internet site:

Burns tells the president: "I have a secret understanding in writing
with the Bundesbank, concurred in by Mr. Schmidt" -- that's Helmut
Schmidt, West Germany's chancellor at the time -- "that Germany will not
buy gold, either from the market or from another government, at a price
above the official price of $42.22 per ounce."

Burns adds, "I am convinced that by far the best position for us to
take at this time is to resist arrangements that provide wide latitude
for central banks and governments to purchase gold at a market-related

While the Burns memo is consistent with the long-established interest
of central banks in controlling the gold price, it was written 36 years

But there is a contemporaneous admission of U.S. government
intervention in the gold market. It has come out of GATA's long Freedom
of Information Act struggle with the U.S. Treasury Department and
Federal Reserve for information about the U.S. gold reserves and gold
swaps, information that has been denied to GATA on the grounds that it
would compromise certain private proprietary interests. (Of course such a
denial, a denial based on private proprietary interests, is in itself a
suggestion that the U.S. gold reserve has been placed, at least partly,
in private hands.)

Responding to President Obama's declaration, soon after his
inauguration, that the federal government would be more open, GATA
renewed its informational requests to the Fed and the Treasury. These
requests concentrated on gold swaps.

Of course both requests were denied again. But through its Washington lawyer, William J. Olson (,
GATA brought an appeal of the Fed's denial, and this appeal was
directed to a full member of the Fed's Board of Governors, Kevin M.
Warsh, formerly a member of the President's Working Group on Financial
Markets, nicknamed the Plunge Protection Team. Warsh denied GATA's
appeal but in his letter to our lawyer he let slip some stunning

Warsh wrote: "In connection with your appeal, I have confirmed that
the information withheld under Exemption 4" -- that's Exemption 4 of the
Freedom of Information Act -- "consists of confidential commercial or
financial information relating to the operations of the Federal Reserve
Banks that was obtained within the meaning of Exemption 4. This includes
information relating to swap arrangements with foreign banks on behalf
of the Federal Reserve System and is not the type of information that is
customarily disclosed to the public. This information was properly
withheld from you."

So there it is: The Federal Reserve today -- right now -- has gold
swap arrangements with "foreign banks," and the public and the markets
must not be permitted to know about them.

Eight years ago Fed Chairman Alan Greenspan and the general counsel
of the Federal Open Market Committee, Virgil Mattingly, vigorously
denied to GATA, through two U.S. senators who had inquired of the Fed on
our behalf, that the Fed had gold swap arrangements, even though FOMC
minutes from 1995 quote Mattingly as saying the U.S. has engaged in gold swaps:

But now the Fed has admitted such arrangements, if only inadvertently.

GATA subsequently sued the Fed in U.S. District Court for the
District of Columbia to gain access to the documents involved. That suit
is pending.

Central banks are out of control

There is a reason for the Fed's insistence that the public and the
markets must not know what the Fed is doing in the gold market.

It is because, as the documents compiled and publicized by GATA
suggest, suppressing or controlling the gold price is part of the
general surreptitious rigging of the currency, bond, and commodity
markets by the U.S. and allied governments; because this market rigging
is the foremost objective of U.S. foreign and economic policy; and
because this rigging cannot work if it is exposed and the markets
realize that they are not really markets at all.

This should not be so surprising. For intervening in markets is what central banks do.. They have no other purpose. They've just gotten out of control.

Central banks often admit intervening in the currency markets, buying
and selling their own currencies and those of other governments to
maintain exchange rates at what they consider politically desirable
levels. Central banks admit doing the same in the government bond
markets. There is even evidence that the Federal Reserve and Treasury
Department, through intermediaries, have been intervening frequently in
the U.S. stock markets since the crash of 1987.

You do not have to settle for rumors about the "Plunge Protection
Team," the President's Working Group on Financial Markets. Again you can
just look at the public record.

The Federal Reserve injects billions of dollars into the stock and
bond markets every week, on the public record, through the major New
York financial houses, its so-called primary dealers in federal
government bonds, using what are called repurchase agreements and the
Fed's Primary Dealer Credit Facility. The financial houses thus have
become the Fed's agents in directing that money into the markets. As
GoldMoney's James Turk notes, the recent rise in the U.S. stock market
matches almost exactly the money funneled by the Fed to the New York
financial houses through repurchase agreements and the Primary Dealer
Credit Facility -- devices of "quantitative easing."

Meanwhile, for years the International Monetary Fund, the central
bank of the central banks, has been openly intervening in the gold
market by threatening to sell gold and then finally selling some, or at
least claiming to have sold some. The IMF said its intent in selling
gold was to raise money to lend to poor nations. This explanation was
ridiculous on its face, though the IMF has never been challenged about
it in the financial press. No, the financial press has been happy to
tell the world that central banks that lately have effortlessly conjured
into existence, out of nothing, fantastic amounts of money in many
currencies could find a little money to help poor countries only by selling gold.

Of course the intent of the IMF and its member central banks was not
to help poor countries but to intimidate the gold market and control the
gold price.

Just as Lars Schall recently tried to get some useful information out
of the Bundesbank about its gold reserves, in April 2008 I wrote to the
managing director of the IMF, Dominque Strauss-Kahn, with five
questions about the IMF's gold. I copied the letter to the IMF’s press
office by e-mail, and quickly began to get some replies from one of its
press officers, Conny Lotze. But they were all evasive or refusals to
answer. Exactly where is the IMF's gold and who controls it? The IMF
wouldn't say:

Lately central bankers often have complained about what they call
"imbalances" in the world financial system. That is, certain countries,
particularly in Asia, run big trade surpluses, while other countries,
especially the United States, run big trade deficits and consume far
more than they produce, living off the rest of the world. These
complaints by the central bankers about "imbalances" are brazenly
hypocritical, since these imbalances have been caused by the central
banks themselves, caused by their constant interventions in the markets
to prevent the markets from coming into balance through ordinary market action lest certain political interests be disturbed.

Yes, when markets balance themselves they sometimes do it brutally,
causing great damage to many of their participants. The United States
enacted a central banking system in 1913 because for the almost 150
years before 1913 the country went through a catastrophic deflation
every decade or so. Central banking was created in the name of
preventing those catastrophic deflations.

The problem with central banking has been mainly the old problem of power -- it corrupts.

Central bankers are supposed to be more capable of restraint than
ordinary politicians, and maybe some are, but they are not always or
even often capable of the necessary restraint. One market
intervention encourages another and another and increases the political
pressure to keep intervening to benefit special interests rather than
the general interest -- to benefit especially the financial interests,
the banking and investment banking industries. These interventions,
subsidies to special interests, increasingly are needed to prevent the
previous imbalances from imploding.

And so we have come to an era of daily market interventions by
central banks -- so much so that the main purpose of central banking now
is to prevent ordinary markets from happening at all.

By manipulating the value of money, central banking controls the
value of all labor, services, and real goods, and yet it is conducted
almost entirely in secret -- because, in choosing winners and losers in
the economy, advancing infinite amounts of money to some participants in
the markets but not to others, administering the ultimate patronage,
central banking cannot survive scrutiny. As has been noted by U.S. Rep.
Ron Paul, the Federal Reserve, an unelected agency of the government,
has come to appropriate and spend far more money than Congress itself

Yet the secrecy of central banking now is taken for granted even in nominally democratic countries.

Now that Paul, an immensely informed critic of the Fed, has become
chairman of the House subcommittee on monetary affairs, there may be
some devastating public inquiries into central banking. But what a
hundred years ago in the United States was called the Money Power is
still so ascendant that it sometimes even boasts of its privilege. What
other agency of a democratic government could get away with the
principle that was articulated on national television in the United
States in 1994 by the vice chairman of the Federal Reserve, Alan
Blinder? Blinder declared: "The last duty of a central banker is to tell
the public the truth."

Official gold data is disinformation

Government's largely surreptitious agenda in the gold market is
greatly assisted by the widespread falsification of gold reserve and
market data. Gold is the worst understood financial market in part
because most official data about gold is actually disinformation.

Years ago GATA disclosed that the International Monetary Fund, the
leading compiler of official gold reserve data, allowed its member
nations to count gold they had leased, gold that had left their vaults,
as if it was still in their vaults. The effect of this accounting fraud
was to deceive the market into thinking that central banks had much more
gold left to bomb the market with than they really did.

But that's only the start of the false data.

In April 2009 China caused a sensation by announcing that its gold
reserves had increased by 76 percent, from 600 tonnes to 1,054 tonnes.
For the previous six years China had been reporting to the IMF only 600
tonnes. Had China acquired those 454 new tonnes only in the last year?
Very unlikely. Most experts believe that China acquired those 454 new
tonnes over at least several years, largely by purchasing the production
of China's own fast-growing gold mining industry. So for as many as six
years the official gold reserve data about China was way off.

Last June the World Gold Council reported that Saudi Arabia's gold
reserves had increased by 126 percent, from 143 to 323 tonnes, just
since 2008. That the world's oil-exporting superpower had made such a
new commitment to gold in its foreign exchange reserves also caused a

But a few weeks later the governor of the Saudi Arabia Monetary
Authority, Muhammad al Jasser, insisted to news reporters that Saudi
Arabia had not purchased the gold cited in the June reports but
rather had possessed that extra gold all along, holding it in what he
called "other accounts":

That is, the seemingly new Saudi gold had been held in accounts not
reported officially, just as the true status of China's gold accounts
was not reported officially for six years, if the true status is being
reported even now.

Some analysts think that China and Saudi Arabia have accumulated far
more gold than they’re reporting and are accumulating still more gold
surreptitiously -- China to hedge its dollar foreign exchange surplus,
Saudi Arabia to hedge both its dollar surplus and the depletion of its
oil reserves -- but that China and Saudi Arabia can't acknowledge this
accumulation lest they spook the currency markets, explode the gold
market, and devalue their dollar surpluses before those surpluses are
fully hedged.

The United States claims to hold almost 8,200 tonnes of gold. But has
any of that gold been swapped with other central banks through the gold
swap arrangements Fed Governor Warsh disclosed in his letter denying
GATA's request for access to the Fed's gold documents? The Fed won't be
answering that question voluntarily. It will be answered only at the
order of the federal court in which GATA is suing the Fed, or at the
direction of Representative Paul's subcommittee.

Conflicts of interest at ETFs

Then there are the major gold and silver exchange-traded funds, which
were established in the last few years supposedly to help ordinary
investors invest conveniently in gold and silver. How much metal do the
ETFs have?

While the major gold and silver ETFs frequently report their metal
holdings, studies by GoldMoney founder James Turk and former GATA board
member Catherine Austin Fitts and her lawyer, Carolyn Betts, suggest
that this data is unreliable too:

For the major ETFs won't disclose exactly where their metal is, and
indeed their prospectuses say it's OK for the ETFs not even to know
where their metal is kept among custodians and sub-custodians.

Further, the custodians for the major gold and silver ETFs are,
perhaps not so coincidentally, also the two major international banks --
J.P. Morgan Chase and HSBC -- that report having the biggest short
positions in gold and silver, short positions that give these banks and
metal custodians a powerful interest in suppressing the price of the assets they supposedly are holding for investors who want those assets to rise in price.

How much gold do the major gold and silver ETFs really have in their
vaults? How much of it is encumbered in some way? ETF investors
themselves may never be permitted to know.

The biggest so-called "physical" gold market in the world is run by
the London Bullion Market Association. The LBMA publishes statistics on
how much gold and silver are traded by its members. But these statistics
show spectacular volumes, more metal than could exist. Of course much
of this metal could be sold and resold back and forth many times every
day. But an expert in that market, Jeffrey Christian of the CPM Group,
acknowledged at a hearing of the U.S. Commodity Futures Trading
Commission last March, as he had acknowledged in an explanatory report
published in 2000, that the London bullion market is actually a
fractional-reserve gold banking system built on the assumption that most
gold buyers will never take delivery of their metal but rather leave it
on deposit with the LBMA member banks from which they bought it.

GATA board member Adrian Douglas has studied the LBMA statistics and
Christian's work and estimates that the great majority of gold sold by
LBMA members doesn't exist -- that most gold sales by LBMA members are
highly leveraged. How leveraged? How much gold is due from LBMA members
that doesn't really exist? Of course the LBMA doesn't report that. Like
the Fed's gold swap arrangements, the world must not be permitted to
know that much of the gold the world thinks it owns is imaginary. The
consequences might be catastrophic for the banks that have sold that
imaginary gold.

For then the world might understand why even at its recent price
above $1,300 per ounce gold has not come close to keeping up with the
inflation, the currency debasement, of the last few decades, why gold
has not completely fulfilled its function of hedging against inflation.

That is, gold's enemies figured out how to increase gold's supply by
vast amounts without going through the trouble of digging it out of the
ground. They invented "paper gold" -- imaginary gold that many buyers
accepted, never suspecting that major financial institutions might
deceive or defraud them.

Negligent journalism about gold

The misunderstanding of the gold market is worsened with the awful journalism about it.

The falsity of the data about the gold market practically screams at financial journalists:

-- There is the omission by official gold reserve reports of leased and swapped gold.

-- There are the sudden huge changes in official gold reserve totals.

-- And there are the deception and conflicts of interest built into ETF prospectuses.

The valid documentation about the gold market also practically screams at financial journalists as well:

-- There are the huge and disproportionate gold, silver, and interest
rate derivative positions built up at just two or three international
banks, positions that never could be undertaken without the express or
implicit underwriting of government, particularly the U.S. government.

-- And there are the many official records, records collected and
publicized by GATA over the years, demonstrating the plans and desire of
the U.S. government to suppress and control the price of gold.

But somehow financial journalists just don't ask about these things.
After all, who are the major advertisers in the financial news media?
The market manipulators and governments themselves.

Here are a couple of examples of this gross failure of journalism in the last year.

Last June the Bank for International Settlements, the central bank of
the central banks, disclosed, via a footnote in its annual report, that
it had undertaken a gold swap of unprecedented size, 346 tonnes. But
the BIS provided no explanation for this. A newsletter writer was the
first to come upon the information; only then did it leach into the
major financial news media. What was going on here?

The reporters for the major financial news media didn't bother going
to the source, didn't bother asking the BIS itself. It was simply
assumed that central banks never give serious answers about what they
do, particularly in regard to gold. Instead the reporters called various
gold market analysts for what they hoped would be informed speculation.

A few days after GATA ridiculed the Reuters news agency for not
demanding answers from the source of the swaps, the BIS, Reuters did
try putting some questions to the bank, and on July 16 last year
Reuters reported: "The BIS said the gold in question was used for 'pure
swap operations with commercial banks' but declined to respond to
further questions from Reuters on the transaction":

Ever since Federal Reserve Governor Warsh admitted to GATA that the
Fed has secret gold swap arrangements with foreign banks, I have been
urging financial journalists to call the Fed to ask about those
arrangements. As far as I know, no news organization has put such
questions to the Fed officially. But, a bit intrigued, a reporter for a
major news agency, having failed to get her editor's authorization to
pursue a story about gold, called the Fed on her own and did ask about
the gold swap arrangements. She told me that a Fed spokesman had told
her: "Oh, we never talk about those things."

GATA has been gaining publicity, if with difficulty. Last year the
Financial Times did a big story about gold that was half about GATA’s
complaints about gold price manipulation by central banks and their
agents, the bullion banks. But amazingly the FT reporter failed to put
any questions to any central bank or government official:

How can you report complaints of central bank gold price manipulation
without questioning central banks themselves? Again, it is just taken
for granted that central banks operate in secret, particularly in regard
to gold, and there's no point in questioning them.

Why gold and silver are mysteries

Why is gold such a mystery? Why is it, along with silver, kept such a mystery?

It's because the two precious metals are not only money but, from the
point of view of free people, the best sort of money, less susceptible
to what governments see as the most desirable quality of money -- the
susceptibility to control by government and particularly susceptibility
to devaluation. You can print or otherwise issue gold and silver
derivatives to infinity, but not the metals themselves.

Gold particularly is kept such a mystery because it is the key to
unlocking the currency markets, which long have been the most efficient
mechanisms of imperialism.

Many of you have heard about the looting of Europe undertaken by the
Nazi German occupation during World War II. But most of that looting did
not take place as it is imagined, at the point of a gun. No, it took
place through the currency markets.

This looting through the currency markets was spelled out by the
November 1943 edition of a military intelligence letter published by the
U.S. War Department, a letter called Tactical and Technical Trends. Of
course the Nazi occupation seized whatever central bank gold reserves
had not been sent out of the occupied countries in time. But then the
Nazi occupation either issued special occupation currency that could not
be used in Germany itself or, in countries that had fairly
sophisticated banking systems, took over the domestic central bank and
enforced an exchange rate much more favorable to the reichsmark. Or else
the Nazi occupation simply printed for itself and spent huge new
amounts of the regular currency of the occupied country.

This control of the currency markets drafted everyone in the occupied
countries into the service of the occupation and achieved a one-way
flow of production -- a flow out of the occupied countries and into Nazi

For a few years Nazi Germany had one hell of a trade deficit -- and
couldn't have cared less about it. For being in the position to print
the currencies for occupied Europe, Nazi Germany never had to cover that
deficit, at least not as long as the military occupation continued.

Since the United States now issues the reserve currency for the
world, the dollar, the United States now more or less occupies most
countries economically, even those countries that have their own
currencies, since even those countries hold most of their foreign
exchange reserves in dollars.

Free-trading and widely accessible gold always has been and always
will be doom to the rigging of the currency markets, always will be the
escape from overbearing government generally and from any overbearing
government in particular. That is why those U.S. government records
compiled by GATA over the years candidly discuss or advocate or describe
controlling and suppressing the gold market -- and suppressing the
truth itself.

The secret knowledge

The truth as GATA sees it is this:

First, gold is the secret knowledge of the financial universe and its
true value relative to currencies is vastly greater than its nominal
price today, since much of the gold that investors think they own
doesn't exist. The actual disposition of Western central bank gold
reserves is a secret more closely guarded than the blueprints for the
manufacture of nuclear weapons. For gold is a deadly weapon against
unlimited government.

Second, all technical analysis of all markets now is faulty if it
fails to account for pervasive and surreptitious government

And third, the intervention against gold is failing because of
overuse, exposure, exhaustion of Western central bank gold reserves from
gold sales and leasing, and the resentment of the developing world,
which is starting to figure out how it has been expropriated by the
dollar system, a system in which people do real work and create real
goods and send them to the United States in exchange for nothing but
colored paper and electrons.

For years now the Western central banks have been attempting a
controlled retreat with gold, bleeding out their reserves with sales,
leases, and especially derivatives so that gold's ascent and the
dollar's inevitable decline may be less shocking. Central bankers often
convey part of this strategy in code; they warn against what they call a
"disorderly decline" in the dollar, as if an "orderly" decline is all

The rise in the gold price over the last decade is just the other
side of that coin -- an "orderly" rise, 15-20 percent or so per year, a
rise carefully modulated by surreptitious central bank intervention.

But GATA believes that the central banks may have to retreat farther
with gold than anyone dreams, and far more abruptly than they have
retreated so far. We believe that when the central banks are overrun in
the gold market, as they were overrun in 1968, and the market begins to
reflect the ratio between, on one hand, the supply of real gold, actual
metal, not the voluminous paper promises of metal, and, on the other
hand, the explosion of the world money supply of the last few decades --
as the market begins to perceive the difference between the real and
the unreal -- there may not be enough zeroes to put behind the gold

Market analysts talk about what they call "reversion to the mean." But maybe we should talk about reversion to the real.

A century ago Rudyard Kipling anticipated this when he wrote a poem
that foresaw the decline of the empire of his country, Great Britain.
Kipling's poem attributed this decline to the loss of the old virtues,
the virtues that were listed at the top of the pages in the special
notebooks, called "copybooks," that were given to British schoolchildren
at that time -- virtues like basic honesty, fair dealing, Ten
Commandments-type stuff. Kipling titled his poem "The Gods of the
Copybook Headings," and its conclusion is a warning to the empire that
succeeded the one he was living in:

Then the gods of the market tumbled,
And their smooth-tongued wizards withdrew
And the hearts of the meanest were humbled
And began to believe it was true
That all is not gold that glitters,
And two and two make four,
And the gods of the copybook headings
Limped up to explain it once more.
As it will be in the future,
It was at the birth of man.
There are only four things certain
Since social progress began:
That the dog returns to his vomit
And the sow returns to her mire,
And the burnt fool's bandaged finger
Goes wabbling back to the fire;
And that after this is accomplished,
And the brave new world begins,
When all men are paid for existing
And no man must pay for his sins,
As surely as water will wet us,
As surely as fire will burn,
The gods of the copybook headings
With terror and slaughter return.

The problem goes far beyond gold price suppression. Indeed, since
central bank intervention in the currency, bond, equities, and commodity
markets has exploded over the last few years, we don’t really know what
the market price of anything is anymore. Thus the gold price
suppression story is a story about the valuation of all capital and
labor in the world -- and whether those values will be set openly in
free markets, the democratic way, or secretly by governments, the
totalitarian way.

The specifics of the gold price suppression operation are
complicated, but you don't have to remember them all if you know what
they mean.

They mean that there is a currency war going on between countries and
their central banks, and a war being waged by central banks against the
people of their own countries. There has been such a war for many
years, only the victims were not really fighting back. Now some of them
are, countries and individuals alike, by buying and taking delivery of
the monetary metals. (Now all we need to do is find a safe planet to
keep them on.)

The focus on London

London may seem like the belly of the beast of Anglo-American
imperialism, being home to both the LBMA and the Bank of England, whose
surrender of the better part of Britain's gold reserves a decade ago, at
the bottom of the market and at the onset of a short squeeze, makes
sense only as part of the gold price suppression scheme and the rescue
of influential bullion banks that were caught short at the market's

But let us instead see this scheme as an aberration and London as the
city where the rescue of all decent civilization was arranged even as
the bombs of the most horrifying evil fell on it. The St. Paul's that
was so famously surrounded by the fire and smoke of those bombs is just
around the corner from this grand old building; please forgive a rube
tourist for being a bit in awe of it all. GATA actually has a few
friends in this city and hereabouts. So this may be as good a place as
any to clamor for the most cosmic justice. After all, isn't it
practically in your anthem?

And did the Countenance Divine
Shine forth upon our clouded hills?
And was Jerusalem builded here
Among these dark, Satanic ... central banking systems?

I don't think Blake would mind too much about that rewriting if he
was still around and knew the facts of the situation. He might even make
it rhyme.

We in GATA have our bow of burning gold; we have our arrows of
desire. But we can always use more, and with your help we will do more
to restore our dear countries, Britain and America together, to their
principles and ideals of democratic, transparent, limited government,
and, really, the brotherhood of man, which, in the end, are what the
monetary metals are about.


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Sat, 01/29/2011 - 14:50 | 916372 Malcolm Tucker
Malcolm Tucker's picture

Saudi King Abdullah publicly endorses Egypt's Mubarak!!

WTF is going on. It's as if they want people to riot...

Sat, 01/29/2011 - 15:01 | 916396 tickhound
tickhound's picture

Seems so much occurring now puts emphasis on "by design"

Sat, 01/29/2011 - 15:36 | 916465 sgt_doom
sgt_doom's picture

"Most Americans will believe almost anything if it's said with a British accent."

Truer words were never spoken.

And as a corollary to this excellent post, please take five minutes to view this invaluable vid talk between Max Keiser and Damon Vrabel.  Must viewing.


Sat, 01/29/2011 - 17:27 | 916708 pslater
pslater's picture

sgrt doom,


Thanks so much for the link!  This needs to be watched by all here at ZH.

Sun, 01/30/2011 - 01:31 | 917445 tpberg7
tpberg7's picture

Sgt Doom,

I watch all of the Max Keiser shows and had forgotten how timely this episode of "On The Edge" was and how appropriate the ideas were.  There are some decent moral people left in the world that know full well what is happening with the Oligarchy that controls our lives.  Material like this needs to be viewed by all concerned persons and spread through the world.

Sat, 01/29/2011 - 17:06 | 916668 Apostate
Apostate's picture

It could very well be that he wants to die.

They're all finished. So is the USSA. It's just a matter of time until we all look down and see that there's nothing but air below us.

Sat, 01/29/2011 - 17:40 | 916728 dark pools of soros
dark pools of soros's picture

Century 8  Quatrain 28

The copies of gold and silver inflated,
which after the theft were thrown into the lake,
at the discovery that all is exhausted and dissipated by the debt.
All scrips and bonds will be wiped out.

Sat, 01/29/2011 - 15:00 | 916392 Threeggg
Threeggg's picture

Listen up !

I just went to the bank to pull some cash (2K)

and the teller said that do to a system wide computer problem I could only take out 500 in cash because they cant see anyones accounts through their system @ the bank.

Went right home and was able to log onto my account online. ???????????????????????

Question is has anyone else had this problem ??

This was Harris Bank in the midwest.

The ironic thing was that I was talking to my wife about this exact thing this morning.

Can someone verify this is only at Harris bank midwest !




Sat, 01/29/2011 - 15:19 | 916430 SustainablePower
SustainablePower's picture

I have had increasing difficulty doing cash withdrawals from several local banks...including the big ones Bank of America, HSBC, Wells Fargo, and Chase.

These problems stem from limited amounts of actual currency in the branches.

It appears to me that if you go to the teller window and attempt to withdraw more than $1000 in cash, they dilly-dally around, complain about how they don't have enough in their teller tray, and then go get a manager's approval.

I have seen this problem in many different branches at many different banks.  I have been discussing this problem with friends for TWO YEARS NOW.

Recently (last 3 weeks) we noted that the $100 USD bills were recycled issues from 10+ years ago.

I believe that there is literally insufficient currency to support the withdraw demands every two weeks on pay day.


Sat, 01/29/2011 - 15:49 | 916498 DoChenRollingBearing
DoChenRollingBearing's picture

My two banks are not as big a problem, but I have seen similar hemming and hawwing.  B of A told me that they need a manager's approval before letting me have $3000 OF MY MONEY in cash.  That amount, I believe, is also the amount that triggers the note to the IRS.

I am glad I have front-run the herd to gold.

Sat, 01/29/2011 - 21:17 | 917096 Bobbyrib
Bobbyrib's picture

Withdrawing $5,000.00 cash of your own money is what actually causes the bank to have to report it. They could report anything they deem "suspicious," but it is not necessary to do so.

Sat, 01/29/2011 - 23:33 | 917304 UncleFester
UncleFester's picture

I heard it was $10K.

Sun, 01/30/2011 - 10:42 | 917689 dryam
dryam's picture

You are correct.

Sat, 01/29/2011 - 15:53 | 916511 Quinvarius
Quinvarius's picture

They did screw up that batch of new 100's with all the gold and graphics all over them.  Could be the problem.  But it doesn't mean it won't be the snowflake that starts the avalanche.

Sat, 01/29/2011 - 15:58 | 916529 dryam
dryam's picture

That "batch" was *only* 1 billion $100 bills.

Sat, 01/29/2011 - 16:03 | 916545 EscapeKey
EscapeKey's picture

I like how a billion is just completely insignificant these days. It's like the change you leave for the waitress, after she serves you coffee.

Sat, 01/29/2011 - 17:08 | 916672 Quinvarius
Quinvarius's picture

Yeah, but who knows how many other batches they didn't print afterwards because they are trying to fix the problem and how many older presses they decommed for the new bills?  Just a theory.  I am not invested in it.

Sun, 01/30/2011 - 08:03 | 917603 sudzee
sudzee's picture

A small crease in the new banknotes. This is absolutely rediculous. To say the most highly skilled printers in the world, who spent their entire careers working with ink and paper somehow completed 50 million sheets of $100 notes that had problems, significantly problematic, just can't happen.

If there is a problem with a run, you don't continue to print truckloads of sheets before you say, OH SHIT we got a problem.

* replacement notes have been used for more than half a century to " replace " both individual ruined notes and sheets.

The real problem as I see it is that those 100 billion notes have been printed and 1: shipped out of the country to replace old notes that were in the vaults of despots and political hacks overseas to ligitimatise their "stash" or 2: The new $100 is not a FRN at all but a new United States Banknote.

Problems with getting actual cash from banks is quite simple. Its a form of currency control protecting the banking system from collapse. Actual printed dollars are leveraged hundred of times into the digital money. Banks can only exist by starving depositors of actual paper dollars. If 1% of depositors in a bank demand their money the bank dies immediately. This is why gold and silver are manipulated.

If the gov't starves the people of real paper money then the people can't buy gold or silver: real wealth. This in turn would negate the all encompassing hold the bankers have on the people.

Digital money = complete control of the lives of everyone on earth.

If you don't have the balls to get out and do something physical about the loss of your rights then just do the next best thing and withdraw 10% of your digital money from the system and buy some protection in gold or silver.



Sat, 01/29/2011 - 16:00 | 916535 Rainman
Rainman's picture

...could just be the fear of bank robbers. Anyone seen stats on the increase in bank robberies nationwide ?? I haven't either, but I'll bet there is a close tie to the unemployment numbers.  

Sat, 01/29/2011 - 17:24 | 916701 UGrev
UGrev's picture

I went into my bank the other day to withdraw some funds and it took them 10 minutes to come up with enough 100's.. funny thing is, it was only just over 2k as well. They basically said that they didn't have the cash on hand in large bills and they didn't get their daily infusion of cash. I thought this was very strange.. for only two thousand dollars. M&T Bank.

Sat, 01/29/2011 - 20:27 | 917012 Cyrano de Bivouac
Cyrano de Bivouac's picture

Same here in Ca.(WF) Manager's approval for withdrawing 2500$.

Sat, 01/29/2011 - 20:27 | 917013 Cyrano de Bivouac
Cyrano de Bivouac's picture

Same here in Ca.(WF) Manager's approval for withdrawing 2500$.

Sat, 01/29/2011 - 19:02 | 916869 gwar5
gwar5's picture

I had trouble last month making online puchases with my debit card. It was deactivated without my knowledge by Wells Fargo/Wachovia.  I'd had an account with Wachovia for 15 years.

I called them up and said what gives? They said it was a "fraud unit" red flag action for my "protection"

I told them it was OK and never mind, it was just me.

They said, no, I'd have to call in each time I wanted to make a purchase over $300. I told them WTF? I need permission to each time to access my own money?

I told them it was my money and I'm taking it all out if they didn't stop --PRONTO!

They did, but they didn't want to. The account is closed now anyway. Enough of that.


Sat, 01/29/2011 - 21:51 | 917167 Marge N Call
Marge N Call's picture

Holy shit THE EXACT same thing happened to me but it was Chase. Mine was a checking account, was yours? I wonder if they are desperately trying to keep those core deposits in the bank - they may be more on the brink than we think they are. I smell desperation and a big-time fucking in the making.

Time to take it all out and put it in the safe in my house.

Sat, 01/29/2011 - 19:50 | 916949 Vint Slugs
Vint Slugs's picture

Your difficulty is most likely just a regional thing, altho it could be bank policy to only keep so much in cash reserves as some of the other posters have noted.  Here in Nevada, probably because of the casino cash flow, there's usually no problem with obtaining immediate cash.  Just to be on the safe side, however, we always call ahead or stop in and speak to the branch mgr or chief teller to let them know we want to make a sizable cash withdrawal on such and such a date.  So far five figure withdrawals here haven't been a problem.

Sun, 01/30/2011 - 00:14 | 917353 OldPhart
OldPhart's picture

Branch Banks are pretty much like any other retail outlets like a donut shop.  Donut shops carry donuts as their product, banks carry cash as their product.  Their inventory is controlled by expectations of demand.  If a donut shop has some forewarning that a group is going to come in and buy 100 dozen donuts they will prepare for it.  If a bank knows someone is going to make a "large" withdrawal, they will also prepare for it.

Banks set their own internal procedures to control cash withdrawal expectations.  They dare not run out of cash for other customers due to an unexpected lump sum withdrawal.  Once that occurs there would possibly be a bank run as the perception people would get is that it is unstable.

$10,000 is the amount that banks were reequired to report initially but these days I think it's dropped down to $5,000 for cash withdrawals and $10,000 for deposits.  Sine my cash deposits may exceed $10,000 from one day to the next the bank has made me exempt for corporate deposits.  Personal transactions still are a pain in the ass.

If I plan to make a large withdrawal, exceeding the banks internal limits of about $2,000 per customer, I'll call a few days ahead of time and let them know of the amount and the day I plan to come for the cash.  That allows them to pull currency from their central bank and have it available without impeding their other customers.

Actual withdrawal of large cash sums is usually done somewhere other than the public lobby, usually off to the side or in another room.  A guard, if available, will usually accompany you to your car without a problem.

Just be polite, most of the girls behind the counter are as ignorant of the whole process as anyone else.  They are merely following the prompts that pop up on their screens.  Uusally they are pretty awed that someone can pull cash like that and get away with it.

Even more fun is going to a car dealership and going through all the shoping and having the salesman pump up everything to the point of financing where all the costs start popping out.  And then pulling out a wad of cash and blowing all the additional costs away along with the stunned look of the financing creature it the backroom.

If you haven't gone through the process of large cash transactions at banks you are asked for ID, your occupation and the source of the cash.  You may anser however you want.  I usually tell them my occupation is "Porn Fluffer" and the source of the money is "My Bank Account".  They are REQUIRED to accept your answer, even if they don't like it.  All they are doing is making out a report to the Secret Service/FBI.  They, if they feel the need, will come and ask further questions.

So far, over the years since the invasive questioning regarding one's own money, my anwers have resulted in nothing but personal amusement.  If investigation's are run, I have no questionable transactions that could possibly raise a flag.


Sun, 01/30/2011 - 08:57 | 917627 done with them all
done with them all's picture

Me too, I have been removing as much cash as possible from Wachovia ( Florida) in amounts under the  5k & 10k flags and every single time I try to take more than 2k the tellers go into to their  'I need to get a managers approval' routine.

They always give it up after they go through their let us help you invest it speech. I did a very large wire transfer to a bullion dealer and the silly twit of an asst. manager kept up the 'let us help you invest speech' the whole time she was filling out the wire forms and still couldn't understand my last question to her- which was do you really think I need your financial advice considering the transaction you are now processing??  It had the words 'precious metal' in the name of the recipient and she still couldn't get her head around that.


done with them all :)

Sun, 01/30/2011 - 13:39 | 917925 Diogenes
Diogenes's picture

You can ask your bank for financial advise (but don't take it) ;)


Think of it this way. Banks are notorious for their low pay scales, right? So what does that tell you about a bank employee's talent for shrewd financial decisions?

Sun, 01/30/2011 - 09:08 | 917633 Snidley Whipsnae
Snidley Whipsnae's picture

Limit at a local credit union is now $2K unless one gives them notice 3 days in advance of withdrawal.

That is down from $5K about a year ago.


Sun, 01/30/2011 - 14:25 | 918052 tamboo
tamboo's picture

3rd national in mo. shit a brick when i tried to cash a check for a little over $5k. sent me 70 miles down the road to the bank the check came from (and they own 3rd national).
absurd. get it all out now! starve the beast!

Sun, 01/30/2011 - 14:26 | 918055 atevan1
atevan1's picture

Same thing happened to me at Bank of the West in CA. I tried to withdraw $3,000 at one branch only to be told I had to go to another branch. I did.  They then told me I couldn't withdraw such a large amount because that branch didn't have enough cash on hand to do so. I eventually talked to the manager and she agreed to give me my money. But they didn't have enough $100's!!! I walked out of there with $2,000 in $20 notes. It was ridiculous. 

Sat, 01/29/2011 - 15:01 | 916394 DavidPierre
DavidPierre's picture

                          THE Bottom?

The riots in Egypt have expanded and are spreading throughout the Middle East, should this erupt in Saudi Arabia it is a safe bet that oil prices will skyrocket. This rioting has occurred on cue with Gold's very oversold (the deepest in nearly a year) and is serving as catalyst for the reversal.

The big drop in Gold and Silver prices were not accompanied by lows in the shares which shows the bottom is now in. If this turns out to be so, the lows for the year will not ever see the "$1,200/oz." handle again.

There have had many similar corrections far deeper than this one... very severe corrections in May/July of 2002 where the HUI dropped from 150 to 100 for a 33% hit....others in 2003 and '04 and an extended (time wise) correction in 2005. Then the winter/spring of 2006 when the shares exploded only to see another May/June smash that took 30%+ off within a month. Of course the biggest hit came in Sept./Nov. 2008 where the HUI dropped from roughly the high 400's down to 150-160 for a 60-70% collapse.

This current correction has been of garden variety at best, yet the sentiment is so negative AFTER 10 years of gains. It really should not be this way yet it is... anyone calling Gold in bubble territory is simply trying to grab headlines and invent fear. There is still very little long held bullishness as traders have yet again "cut and run".

The fundamentals are now such that only those with a financial death wish or otherwise illiterate do not own physical Gold, Silver or the shares, plain and simple. The "peasants" are beginning to riot and governments are on the verge of bankruptcies which will submarine a whole slew of fiat currencies in the process. Gold cannot default and will only attract more fear capital as time goes on which is why it is a must have, NOW!

Maybe the bottom is not in, time will tell. My reason for writing this piece is to try to reassure anyone with weak knees because now is the absolute worst time to consider throwing in the towel. We have fought for more than 10 years in a rigged market and have won substantial "fiat booty", the Golden ring is just out ahead of us. Make sure you are one of the few with a firm grasp on it!

{via lemet.}

Sat, 01/29/2011 - 15:50 | 916504 DoChenRollingBearing
DoChenRollingBearing's picture

Keep Le Met coming DavidP, I do not subscribe and appreciate ALL knowledgeable sources on gold.

Thanks for sharing.

Sat, 01/29/2011 - 16:23 | 916582 DavidPierre
DavidPierre's picture

Bill Murphy yesterday...

"Veteran Café members will recall me moaning for months and months last year how lousy The Café Sentiment Indicator (a gauge of interest based on paying memberships, new trials, and hits on the site) was. Well, something is going on out there because the past few days it has catapulted to a 9 (1 being the worst and 10 the best). It’s been on fire on a sharp DIP in the gold and silver prices. That has not ever happened in 12 years. Most pleasantly surprised, I mentioned it to a colleague who thought it might be because The Gold Cartel made this recent take down so ridiculous, people wanted to find out what was really going on. Got me smiling anyway."

... maybe more and more ZH readers finally going to THE SOURCE for honest information.


Two week FREE, no obligation, get acquainted membership...


Sat, 01/29/2011 - 15:33 | 916434 TruthInSunshine
TruthInSunshine's picture

If there is a major 'structural disruption' in Saudi Arabia, we'll be in an economic depression faster than The Bernank can say "I'm 100% confident I have the tools to effectively combat this," with a cracking voice projected through quivering lips and  nervous, flinching facial twitches.

This is NOT circa-1979 America, which still had a meaty and vibrant manufacturing base, relatively low debt levels, and far fewer stuctural issues of today (thanks, in part, to people like Greenspan and Bernanke).

And beside, what will he do? Lower the overnight Fed Funds Rate?? Buy more treasuries from the Squid and other PDs? Buy more MBS?

He's on warp drive already.

Way to leave yourself some tools (not), Ben!

Sat, 01/29/2011 - 21:11 | 917082 Hephasteus
Hephasteus's picture

Bad news peaches. It's not just manufacturing. America is a net importer of food. Thanks to dumbass synthehol.

Sat, 01/29/2011 - 15:35 | 916460 NOTW777
NOTW777's picture

"The United States claims to hold almost 8,200 tonnes of gold. But has any of that gold been swapped with other central banks through the gold swap arrangements Fed Governor Warsh disclosed in his letter denying GATA's request for access to the Fed's gold documents? The Fed won't be answering that question voluntarily. It will be answered only at the order of the federal court in which GATA is suing the Fed, or at the direction of Representative Paul's subcommittee."

subcommitttee - please make that order if you have the power


Sat, 01/29/2011 - 15:38 | 916467 NOTW777
NOTW777's picture

"an "orderly" rise, 15-20 percent or so per year, a rise carefully modulated by surreptitious central bank intervention."

amazing. with all the manipulation, lies and deception, the bottom line is that PMs are still rising substantially.  just wait til the anchor of manipulation is cut

Sat, 01/29/2011 - 15:40 | 916472 SWCroaker
SWCroaker's picture

Your work is paying off.  I came to knowledge of gold late, in 2007 when sub-prime (& CDSs) broke.  GATA and numerous other voices of sanity were there with breadcrumbs for me to follow.  I bought into the message, am now debt free, have a couple of years expenses stocked away in bullion, and am able at this point to sit on substaintial gains and just munch popcorn while watching all of the histrionics.  I've bought a lot of bullion in the last 4+ years, and have yet to sell an ounce.  (I've given some away, in my own little campaign to spread the disease, but I've never yet sold). 

I may one day sell some, when I think we're near or above actual value.  At $1,400 and $30, we haven't even started to price bullion properly.

Thanks again for your efforts, they have helped immensely.

Sat, 01/29/2011 - 17:05 | 916664 Fahrenheit451
Fahrenheit451's picture

I'm on the other side of your trade.  I'm borrowing a massive amount and have no equity in my home.  I managed to qualify for a 1 month LIBOR loan.  Although I can pay off my house, I prefer to have most of that equity in physical gold.

Sat, 01/29/2011 - 15:41 | 916473 Kaiser Sousa
Kaiser Sousa's picture

worried about ur currency or the state of ur society???

now worries, the politicians got it figured out...

"It may sound like a bird-brained idea, but the mayor of Lancaster wants to brighten up the Mojave Desert city by broadcasting recorded bird songs.

R. Rex Parris proposed the idea during his State of the City talk on Monday.

The Antelope Valley Press says Parris wants to play the bird chatter from loudspeakers on Lancaster Boulevard. The mayor says there’s science to show that listening to birdsong makes people happier."

Sat, 01/29/2011 - 19:55 | 916956 flacon
flacon's picture

LOL! I added that to my fb page! :)

Sat, 01/29/2011 - 15:44 | 916483 NOTW777
NOTW777's picture

kudos to GATA for its professional, almost excessive use of objective and undeniable proof of its claims and statements. in this day and age that is rare.  many, even so-called experts make claims without citation or support or links or back-up

Sun, 01/30/2011 - 02:12 | 917473 Bay of Pigs
Bay of Pigs's picture

Mish says we're full of shit. Very sad. I've tried my best to spread the truth.

Sat, 01/29/2011 - 15:50 | 916485 savagegoose
savagegoose's picture

great read i didnt go to all the links. or id be here all night.

gotta ask myself tho wont we run out out of folding before they run out of ink?

oh and i bookmarked and emailed to a few people. this one has to go viral

Sat, 01/29/2011 - 15:46 | 916489 bronzie
bronzie's picture

"since central bank intervention in the currency, bond, equities, and commodity markets has exploded over the last few years, we don’t really know what the market price of anything is anymore"

and because we don't know the market price of anything anymore we are unable to make intelligent investment decisions - do I buy rental real estate?  do I invest in the equity markets?  do I buy bonds?

since none of those questions can be answered, the only safe path is to take physical possession of the only true and honest money (silver and gold) and wait for the next incarnation of the economic system

there is no way to know what the next economic incarnation will look like but there are numerous signs that the current incarnation is nearing its end-point - study Kondratieff Winter, Fourth Turning and financial bubbles for some insight

will central bankers raise interest rates into the double-digits ala Volker in the 1980's?  in that environment it might make sense to buy govt bonds paying 15% or more - in that environment real estate prices will crash so purchasing rental real estate for cash might make sense

will central bankers fix their fiat currencies against the value of gold?  the fixed price of gold would likely be somewhere between $5000/oz and $55,000/oz - Jim Sinclair suggests that gold isn't going to peak and then decline like it did in the 1980's because central banks will fix the value of gold at some high price - in that environment all asset categories will be re-priced relative to the fixed value of gold and we'll have to wait for the re-pricing to make intelligent investment decisions

so many different ways that the current situation might resolve - there is no way for us to know at this point so again, all we can do is take physical delivery of silver and gold and wait ...

Sat, 01/29/2011 - 16:11 | 916561 trav7777
trav7777's picture

in a fiat FX regime, no fixed price can be maintained.

Sat, 01/29/2011 - 18:04 | 916772 bronzie
bronzie's picture

"in a fiat FX regime, no fixed price can be maintained"

I agree - my main point is that the price of gold may not decline dramatically from whatever value it ultimately reaches - I think some people are expecting a parabolic finish to the current precious metals bull market and that after the peak is reached, gold will enter another secular (15-20 years) decline like it did from 1981 to 1999 - it is possible that gold will reach some high value and stay there - as an investor, this is an important factor to consider - if gold stays at a high price it might make sense to keep some portion of your wealth in gold - if gold goes parabolic and declines, it would make sense to transfer wealth out of gold and into other asset categories

the central bankers are going to take any number of fallback positions as the global economy continues its collapse - the first step (which they are already discussing) will be another worthless fiat currency but they will choose a global institution (IMF or BIS?) to issue the worthless fiat - SDRs via the IMF are already being discussed to replace the US dollar as reserve currency

another fallback position will be a fiat currency tied to some basket of commodities which will likely include gold and petroleum - this fallback position is likely to appease many uninformed people because they will THINK that fiat currency is now tied to tangible goods - they will be sadly mistaken because central bankers will still be able to play all of the same games they are currently playing - as you point out, no fixed price can be maintained and monetary debasement by the central banks will continue even though the fiat currency is tied to a basket of goods

the only honest monetary system IMO is having a fully convertible currency in circulation - the circulating currency has to be convertible to some tangible good - the tangible good can be gold, silver, calories of food, bedpans or pretty beads - it doesn't really matter as long as the majority of humans on this planet agree that the tangible good has real value - history has shown that gold is the tangible good that most humans accept as having value - in a convertible monetary system, it is the CHOICE to hold the circulating currency OR CONVERT IT to the tangible good, which gives the people control over the central banks - when the banks are behaving the people will leave their wealth in the circulating currency - when the banks start playing games the people will transfer out of the circulating currency and into the tangible good

Sat, 01/29/2011 - 22:45 | 917254 flacon
flacon's picture

Blogger "Flow Of Value" tackles this point. This is an excellent read and I highly encourage everyone to read it:


Sat, 01/29/2011 - 15:52 | 916512 DoChenRollingBearing
DoChenRollingBearing's picture

FOFOA wrote me last night and said he was about to post another column, that it would have details on gold and the ETFs...  I have not yet checked today.

Sat, 01/29/2011 - 16:40 | 916625 DoChenRollingBearing
DoChenRollingBearing's picture

FOFOA's new article (draining the GLD) is up at his blog.  My next stop...

Sun, 01/30/2011 - 09:14 | 917634 living on the edge
living on the edge's picture

I always read FOFOA's articles, they are quite interesting. I wonder if they are still in contact with Another? Anyways this article by GATA reads as if FOFOA wrote it.

Sat, 01/29/2011 - 15:53 | 916516 trav7777
trav7777's picture

re-read that Nazi occupation shit again...massive trade imbalances they never had to pay off.  All the occupied States' production flowed into Germany for their benefit and the paper flowed out.

gee, what type of arrangement does this kinda sound like? 

Sat, 01/29/2011 - 16:15 | 916565 dryam
dryam's picture

That Nazi thing didn't seem to work out so well.  Thank God history doesn't tend to repeat itself.

Sat, 01/29/2011 - 16:27 | 916593 Sean7k
Sean7k's picture


Sat, 01/29/2011 - 17:27 | 916711 Careless Whisper
Careless Whisper's picture

So basically, the Nazis stole the gold from the Central Banks of occupied Europe, and then being in control of those Central Banks, just printed away.

Sat, 01/29/2011 - 17:46 | 916736 steve from virginia
steve from virginia's picture


German wartime economic strategy was a failure:

The Germans were far less productive than their adversaries.

The German postwar economic strategy has also been problematic.

The convertability thesis is not as nuanced as the fiat thesis has proven to be. See Gary Gorton's interview re: different forms of moral hazard and liquidating the banking system:

Gold is a reserve asset for central banks. If any central banks hold gold their counterparties must also hold gold. In other words, gold is a 'currency' for central banks: If you have to know how much gold you cannot afford to play.

Central banks have been buying gold for several years, this is no secret. Gold is an asset like stocks or commercial bonds, which the central banks are also buying. This is also the trend- maker. If central banks were selling gold the price would go down.

Central banks are in the currency business. Bernanke is selling the public that paper dollars are worthless and should be traded to finance for 'assets' (such as gold). Gold becomes a liquidity trap. Since the asset- sellers (who are rich, by the way) like the paper dollars there must be something to them.

Paper currency values are set by the crude oil/currency trade (mostly in dollars and euros). Gold can rise to $10,000 per oz and nobody will care except for some gold traders. Oil goes to $120 barrel and everyone on planet Earth will care. What's happening in Europe and ME is the consequence of + $80 oil. High fuel prices translate directly to high food prics as each calorie of food embeds ten or more calories of petroleum.

PS: steve from virginia's finance tip o' the day: By all means hold gold but never buy the paper version.

Sat, 01/29/2011 - 18:12 | 916782 bronzie
bronzie's picture

"Gold can rise to $10,000 per oz and nobody will care"

this is an important point to understand IMO - the central banks don't care if gold reaches $10K/oz or $55K/oz AS LONG AS THEY CAN CONTINUE PLAYING THEIR FIAT CURRENCY GAMES (sorry for yelling)

they can back a fiat currency with gold and continue their current games - a fiat currency backed by gold is just an appeasement to the people being screwed over by the bankers' monetary debasement (running the printing presses 24/7) - look no further than the Euro to see a fiat currency which is backed by gold (15% at its inception) - the gold backing for the Euro was just a marketing scheme to help people accept a new fiat currency

the only way to end the bankster games is to have a fully convertible currency

Sat, 01/29/2011 - 18:32 | 916818 EscapeKey
EscapeKey's picture

 What's happening in Europe and ME is the consequence of + $80 oil.

Which, in turn, is caused by endless deficits financed by infinite money printing.

Sat, 01/29/2011 - 18:00 | 916758 Sean7k
Sean7k's picture

Trav, I guess you actually have to spell it out. I thought you comment was pretty self-explanatory. 

Sat, 01/29/2011 - 16:01 | 916536 bronzie
bronzie's picture

the article above is a good summary of GATA's research into the gold markets - they talk about leases, swaps, the London Gold Pool, etc

there is no mention however of the re-categorization of the gold supposedly held by the US Treasury - you know, that 8,000 tons of physical gold bullion that the US claims to hold

in Sept 2000 the "Gold Bullion Reserve" was re-categorized to "Custodial Gold"

in May 2001 the "Custodial Gold" was re-categorized to "Deep Storage Gold"

these re-categorizations raise some interesting questions:

> "Custodial Gold" implies that the US Treasury is only holding the gold for someone else - who is that someone else?  what are the details of the custodial arrangement?

> "Deep Storage Gold" may imply that the gold has yet to be mined - ie, physical gold bullion has been replaced by the alleged assets of a gold mine (also known as a hole in the ground with a lier standing at the top, but that's another issue)

what is the real status of the alleged 8,000 tons of US gold?  your guess is as good as mine ...

Sat, 01/29/2011 - 16:03 | 916537 Bluntly Put
Bluntly Put's picture

This summary seems oversimplified.

The entire global economy evolved on bills of credit that matured into gold. The modern science of accounting derived from that trade, and as necessity assumes that the unit of account is constant. That is a constant is needed when calculating future value in terms of present value. But the unit of account (fiat currency) is a dynamic variable, constantly changing in value. Gold never had that problem it was a constant weight and purity.

The problem is much, much more severe than GATA contends.

Sat, 01/29/2011 - 16:06 | 916548 topcallingtroll
topcallingtroll's picture

I don't really think any of tptb are so stupid as to think they can permanently suppress the gold price. However they want stable changes over time. No central bank will tolerate a five percent rise or fall in it's currency in a short period of time if it has the power to crush those marginal longs and shorts that piled in. Same with gold. Gold's equilibrium price may be right around here for the time being. It may be higher or lower. Wherever it is, intervention is designed to minimize volatility per unit of time and lengthen that impulse wave by tossing in some counter trend pressure every now and then. No one really cares if gold's equilibrium price is 3000 or more just as long as it doesn't get there too quickly and destabilize other things along the way.

Sat, 01/29/2011 - 16:06 | 916550 Troy Ounce
Troy Ounce's picture

Congratulations to GATA. I emailed the article to 2 different national newspapers in my country.


Sat, 01/29/2011 - 16:07 | 916551 dryam
dryam's picture

I have had the thought that the Eastern world might be more apt to adopt a silver backed currency & leave the U.S. and Western world rotting on the vine with their relative excesses of gold.  Would this even make sense?  Could silver become the more valuable metal?  The U.S. deserves to come out of this financial mess as the biggest loser because they have been the biggest abuser.  If some type of gold standard was reinstituted, the U.S. wouldn't come out that bad with it's presumed 8,000 tonnes.

Sat, 01/29/2011 - 17:30 | 916699 DavidPierre
DavidPierre's picture

The World Is Waiting For The Sunrise:

A Practical Guide to the Re-Monetization of Silver

Here is an excerpt from a longer discussion presented by Hugo Salinas-Price in London.


Although the proper title of the presentation is 'A Discussion of Precious Metals As Money,' I tend to call it 'A Practical Guide and Rationale For The Re-Monetization of Silver.' You can read the presentation here. I present an important excerpt, part III, below.

For my own part, I do not favor a return to a formal gold or silver standard at this time. I do not prefer it because I do not wish the developed and dominant nations to monopolize and formally set the price of these metals as they have been doing informally, given the unstable, opaque, and dare I say conflicted, nature of their financial systems.

Rather, I think it would serve the purpose to have a trusted coin available with the sanction of the State, at a floating price, to serve in parallel with whatever fiat currency regimes that may be locally in place.

Thus one could call it the re-monetization of silver, but not the imposition of a formal gold or silver standard. This has two striking benefits: the flexibility to informally devalue or strengthen the national fiat currency, with a sound and safe way to store individual wealth and promote savings and the accumulation of capital for productive investments. A progressive country might even treat the gain (or loss) of the bullion coin's value as a non-taxable item, providing some remedy to the people if the central bank indulges in printing money and quantitative easing.

This is similar to that which we have today, except that the coin would provide a reliable and practical means of obtaining and storing wealth for the individual, far superior to the ad hoc system of precious metals ownership in place today that is greatly abused by naked short selling and paper leverage, the same taint of the banks which has devastated the global financial system.

I would look for keen opposition to this by the Anglo-American banking cartel and their friends in central government, since this proposal is inimical to the domination of others through the absolute control of a paper money system and the process of confiscating wealth in the form of inflation, fees, and frauds. However, I think the zenith of their power is already passing, and because of their foolish and reckless excesses the tide history is about to roll over them. Most of those close to the system will never even see it coming. Such is the way of long cycle changes.

I believe this proposal offers a unique opportunity to whatever country first steps forward to take it, and provide a universally acceptable metal coin with a floating value that can be used for public and private transactions in their country, as well as private transactions in other regions of the world. After all, one of the primary currencies in young America was the Spanish Dollar, the silver eight reales coin, the source of the phrase, 'pieces of eight.'

With the inclusion of modern technology to promote confidence and inhibit counterfeiting with some elementary testing equipment, some fortunate country could establish itself as the first nation to introduce a hard alternative currency for itself and for the world, in the face of a failing post-Bretton Woods monetary system, to the benefit of their people.

I do not expect the US or the UK to be this innovator, and in fact to stubbornly resist it for the reason cited above. Rather it is more likely to be some emerging economic power such as Mexico, India, Venezuela, Russia or China. Or perhaps even a confederation of countries or US states acting for the benefit of their people in the face of the powerful banking lobby centered in Washington and New York.

I see this as important now because of an abiding belief that the US dollar reserve currency and international trading regime is highly unstable and too likely to collapse because of a loss of confidence under the weight of pernicious financial corruption. Obama's failure to reform has sealed its fate, and I think we are beyond the point of no return.

I also see great peril in the west with regard to the principle of the private ownership of property, a deficiency created by the very banking system that rose to power on the canard of deregulation and free markets, which has been used as a guise by which to plunder the wealth of the nation. The large scale seizure of property through a highly questionable and fraudulently based foreclosure process may be a portent of things to come. Savings held as electronic digits are much easier to control, debase, defraud, and devalue.

And I think confidence in the financial markets and assets are at all time lows among the people, despite the aggressive public relations campaign to the contrary being conducted by the bankers and their demimonde in the corporations, central banks, and central governments.

Thus there is an obvious need for a store of wealth that is universal, liquid, portable, and not as subject to the whims of the shadow banking system and the financial plutocracy. This could happen in the existing system if naked shorting were banned and the regulators would perform their sworn duties to the people, but that appears to be unlikely, and all too easily corruptible. So a convenient and widespread bullion coin appears to be the best alternative. The question in my mind is not so much 'will it happen?' as it is 'who will be the first?' To me it would be the ultimate irony if such a move to promote economic freedom came from a non-Western country.

The World is indeed in the winter of its financial discontent, and 'waiting for the sunrise.'

Sat, 01/29/2011 - 18:09 | 916778 Sean7k
Sean7k's picture

End legal tender laws. Does the same thing. Why he disparages private property ownership? With so brief a comment and no justification? 

Sat, 01/29/2011 - 18:26 | 916807 bronzie
bronzie's picture

"Why he disparages private property ownership?"

I don't think he is disparaging private property ownership - he is pointing out that western govts are screwing the people out of their property in the current system

the 'screwing' comes in the form of monetary debasement via the printing presses and from real estate related tricks like fraudulent foreclosures

he didn't mention the abuse of eminent domain which has also been practiced in recent years - eminent domain is where a private property owner gets fucked over by the legal system and told that somebody else now owns their property - the new owner is usually a property developer or someone connected to the power structure (or both) - eminent domain has been used in San Diego in at least two different guises - the first is to declare a neighborhood 'blighted' which causes the property values to drop - the govt then uses eminent domain to take private property so it can be re-developed in an effort to cure the 'blight' - the second case involves the re-development of downtown and the building of Petco baseball park - numerous properties were taken via eminent domain to make way for these developments

Sat, 01/29/2011 - 19:35 | 916920 Sean7k
Sean7k's picture

"I also see great peril in the west with regard to the principle of the private ownership of property", this is pretty clear. I understand the problems associated with tax policy and property seizure- he disparages the "principle" of property ownership. 

Without the opportunity to build wealth, there is no reason to work hard and save or invest. The principle of property ownership is essential to building a growing economy.

Sun, 01/30/2011 - 09:43 | 917650 Snidley Whipsnae
Snidley Whipsnae's picture

'eminent domain' was originally intended to be confiscation of private property, at a fair market price, to benefit a large portion of Americans at the (perhaps) cost of a few. The US Interstate Hwy System is a good example of eminent domain used as it was intended...imo.

Where the rub has entered is the confiscation of private property by envoking eminent domain to allow a private enterprise to confiscate the property of citizens for the construction of more rentier property. A good example of this is the confiscation of even public parks for the construction of high rise condos, hotels, etc, on valuable and limited beach front property.

Another problem today with eminent domain is that a private property owner is paid for his/her seized property in rapidly devaluing currencies. What is a 'fair price' when the fiat is falling like a rock?...For instance, though home prices are down ~30% against priced in dollars, home prices are down ~60% priced in gold.

Mon, 01/31/2011 - 20:33 | 922311 prophet_banker
prophet_banker's picture

Gold's recovery/recycle rates are off the chart when put next to silver, to the point that the majority off the earths silver that has been mined has already been used up, and is no longer recoverable.

Sat, 01/29/2011 - 16:17 | 916572 outamyeffinway
outamyeffinway's picture

Dam fine work, dam fine!!

Sat, 01/29/2011 - 16:23 | 916579 bob_dabolina
bob_dabolina's picture

These global revolutions will really attract the big buyers and send the SPX another 500 points higher.

Our sales were 125% higher than Jan. 28th last year so clearly this is a positive sign and reason to snatch up AMZN shares.


Sat, 01/29/2011 - 17:05 | 916662 Hedgetard55
Hedgetard55's picture

The Power of Gold. Dan Fogelberg and Tim Weisberg knew. Watch.


Sat, 01/29/2011 - 17:13 | 916678 Miss Expectations
Miss Expectations's picture

It's been said that the love of money is the root of all evil.  Things have gotten so strange that the lovers of money actually hate gold.

Sat, 01/29/2011 - 18:00 | 916757 Temporalist
Temporalist's picture

Actually they love it so much they are trying to clone it but have produced an inferior Frankenstein's Monster debt currency.

Sat, 01/29/2011 - 18:51 | 916853 CustomersMan
CustomersMan's picture



   It wouldn't surprise me if the "haters" of gold actually have the largest physical holdings themselves stashed away.

Sat, 01/29/2011 - 17:14 | 916680 Turd Ferguson
Turd Ferguson's picture

This is great stuff. We should all support GATA...financially if possible.

Sat, 01/29/2011 - 18:11 | 916781 Sean7k
Sean7k's picture

Happy Birthday Turd!

Sun, 01/30/2011 - 00:26 | 917366 UncleFester
UncleFester's picture

Turd is the word,

The 2Y trading low $price held-up, no?  I said this before somewhere, sub $1350 is cheap flow and should be bought for trade!  But hesitate, did it hold b/c of Egypt?  $1300 was almost tested intraday, what will next week bring?  I also said this before at the sameplace, substantially below $ metal will flow!  When everyone needs it, eventhought hey don't know it, no metal will flow.  The Euro/Au float, followed by the WAG, followed by a decade of orderly withdrawal...if this shit isn't planned and the tape isn't painted, then why do I have permanent chill bumps nearly everyday?


PS.  Should Au $price fail here, go long lead.


Sat, 01/29/2011 - 18:42 | 916839 Kondor01
Kondor01's picture

Saw a few hours ago where Saudi Arabia has the "Tunisia disease". When wages don't keep up with prices people tend to get a tad bit upset.

Sat, 01/29/2011 - 21:02 | 917070 AUD
AUD's picture

Some years ago, circa 1997-98, the Asian financial crisis saw the credit of several governments in the region fail, 'inflation' was rampant. I was to young to take much notice at the time but in Indonesia the Muslims & the Christians were at each others throats, literally. Not far away in the South Pacific the Solomon Islands descended into a state of violent anarchy, beheadings were commonplace as government authority vapourised along with its bad credit.

I only have data for the Saudi Arabian Riyal but it has depreciated significantly against the Australian dollar in the last 6 months. The situation is probably no different in Tunsia, Egypt etc.

Such is the nature of bad credit.

Sun, 01/30/2011 - 09:51 | 917653 Snidley Whipsnae
Snidley Whipsnae's picture

The cops is Egypt have disappeared... From Mish... Does anyone believe that the human nature of Egyptian cops is different from the human nature of cops anywhere?


Egyptian Police Disappear in Widespread Chaos, Vigilantes Defend Homes; Egypt Video With a Message "We Will Never be Silenced!"

Sun, 01/30/2011 - 23:08 | 919168 Cathartes Aura
Cathartes Aura's picture

in reading that report, one has to ponder the withdrawal of police, escaped/released prisoners, gangs of "looters" - it's almost as if by letting "chaos" take over, with maybe strategic crimes being committed against the population, might be part of an overall plan to "restore order" at the request of the citizens. . .

always easier for those in power if they're begged to "stay". . .

here's hoping the egyptian people can continue to target the power structure, and not resort to their fellow citizens.

Sat, 01/29/2011 - 18:45 | 916844 razorthin
razorthin's picture

these miscreants, in their sociopathy, must think the rest of society finds their manipulation acceptable as to be so brazen and candid in their statements.

Sat, 01/29/2011 - 19:09 | 916878 gwar5
gwar5's picture

Free Gold is freedom.

It's not a central banker conspiracy theory, it's a conspiracy fact.

GATA, King World News, and ZeroHedge are my favorites sites to find out what is really going on.

If you're not using any such Websites you are economically illiterate these days. Join the struggle.  


Sun, 01/30/2011 - 02:16 | 917477 Bay of Pigs
Bay of Pigs's picture

Brothers in Arms...

Sun, 01/30/2011 - 12:21 | 917770 Zero Debt
Zero Debt's picture

+1 Krugerrand

Sat, 01/29/2011 - 19:36 | 916923 CB
CB's picture

glad to see GATA's work posted here at ZH

Sun, 01/30/2011 - 00:07 | 917344 JW n FL
JW n FL's picture

GATA has been quoted and sourced here 1 million times over.

Sun, 01/30/2011 - 15:50 | 918259 RockyRacoon
RockyRacoon's picture

Must you take the shine off of everything?  Simply agreeing would be enough.

Sat, 01/29/2011 - 19:47 | 916943 Dr. Gonzo
Dr. Gonzo's picture

"I live for my dreams...and a pocket full of gold."

Led Zepplin 1971


Sun, 01/30/2011 - 18:58 | 918740 nuinut
Sat, 01/29/2011 - 19:58 | 916959 DosZap
DosZap's picture

After all is said and done, and the bstds are caught red handed, nothing has been accomplished.

We all know the findings.

We also know the Chickenshit in the WH will sign off any institution that is in the Inner Sanctum.

Shades of JPM, and Silver.'

All for naught. To prove malfeasance, and illegal dealings, just to walk.

Sat, 01/29/2011 - 20:31 | 917021 Youri Carma
Youri Carma's picture

Greenspan in 1998, before Congress:

"central banks stand ready to LEASE GOLD in increasing quantities, should its price rise."

William S. White June stipulated in 2005 ( head of the Monetary and Economic Department of the Bank of International Settlements in Basel ):

"One of the five main purposes of central bank cooperation is the provision of international credits and joint efforts to influence asset prices – especially gold and foreign exchange – in circumstances where this might be thoughtful."

Australian Central Bank 2003:

"Foreign currency reserves and gold are held primarily to support intervention in the foreign exchange markets!"

Dutch central bankster Nout Wellink (CFR member and Bilderberger) always said to his colleagues:

“There are two thing you can lie about as central banker, gold and interest rates.”

Jim Rickards about Gold Manipulation:

“We call it market manipulation the central banks simply call it policy.”

Sat, 01/29/2011 - 20:56 | 917061 lynnybee
lynnybee's picture

I love articles like this !!!  tons of great info !! tons of great commentary + more links for me to study !  ........... this story is the story of our lives, the biggest story of corruption & fraud in the history of the U.S.      & we are going to live through it, CAST OFF THE FEDERAL RESERVE BANK .......... wish us all luck !

Sat, 01/29/2011 - 22:07 | 917194 saulysw
saulysw's picture

I agree, there is a lot to think about here. The issues run deep. I'm not particularly a conspiracy theory kinda guy, but I would not put it past these people that power has corrupted them. Too much stuff happens in secret. The "national security" shield is abused. The thing is that things seem to be changing...

Sat, 01/29/2011 - 21:57 | 917179 uraniuman
uraniuman's picture

What gold? My guess is it has been gone for years. (see Jim Willie - 1 - 26 - 11 )

Sun, 01/30/2011 - 09:38 | 917649 living on the edge
living on the edge's picture

Love Jim Willie. He does a great job.

Sat, 01/29/2011 - 22:01 | 917182 austin0388
austin0388's picture

Excellent article, thanks!  I would make one request: provide a 3-minute-read version (5 minutes for slow readers) for all the people who need exposure to this information but don't want to take too much time away from "Dancing with the Stars".  I have tried to get many of my friends to read some of the articles posted on ZH and elsewhere but their eyes glaze over too easily.  Denial about what is going on in the economy is a very great thing and the MSM, as ZH readers know, is not even providing sound-bite versions of the real issues out there. Thanks again - this will be one more ZH article to bookmark and save for future reference.

Sat, 01/29/2011 - 22:10 | 917199 saulysw
saulysw's picture

Short version : Buy physical gold and silver now. I bet they have none. Try giving them a silver ounce to start them thinking about the issue. They will take it home and wonder what to do with it, hold it in there hands, and the light just might come on.

Sun, 01/30/2011 - 09:59 | 917660 Snidley Whipsnae
Snidley Whipsnae's picture

People fear change almost as much as death... IOWs, good luck changing people's minds cause they are dead set against it.

I have read that about 1% of Americans have made a serious commitment to using PMs as a store of value.

I would wager that much of that 1% is comprised of employees in the financial industry.

Tell em one time. If they don't want to listen there is no sense making an enemy of them by being a nag. They will find out soon enough that they messed up big time...But, when the light does come on for them don't be an 'I told you so' azz hat. Keep your own council.

Sun, 01/30/2011 - 02:14 | 917476 Math Man
Math Man's picture

"You may have heard GATA derided as a "conspiracy theory" organization. We are not that at all."


That is the biggest crock of bullshit I have ever heard.


The whole presentation was full of conspriarcy theories and speculation.


I'm looking forward to the continuation of the Gold sell off next week.


Sun, 01/30/2011 - 03:30 | 917518 Hephasteus
Hephasteus's picture

Ya you smash gold and silver down just keep platinum and paladium up and oil way up too. Oh and make sure 1oz gold coins still sell for 1380. LOL

You go math boy. You count to potato. Fuck everybody.

Sun, 01/30/2011 - 04:54 | 917547 stopthenewworldorder
stopthenewworldorder's picture

math boy stop being a twat and your other moniker johnny b can stick it where sun dont shine too

Sun, 01/30/2011 - 10:22 | 917670 Math Man
Math Man's picture

You gold bugs are all morons.  If you really think Gold is going to save you, you've got another thing coming.

GATA takes a few small statements that have been made throughout history and trys to extapolate a massive conspiracy theory - and you morons have swallowed it hook, line and sinker.

You are all screwed.  The yellow rock has almost no industrial uses.  Only around 50% of the gold we mine each year is used for jewelery, dental and industrial uses.  It only goes up in price because of demand from speculative investment.   Now that the economy is getting back on track, investment demand is declining.   Annual gold production is moving up, while investment demand is declining. It's only a matter of time before gold is back at around $600/oz.

Even the Egyptian catastophe couldn't save you.  Gold was still down on the week, and we STILL had outflows from the ETFs.  EVERYBODY IS STILL HITTING THE BID.

You're all screwed.

You're speculating in an asset class that relies on violence and uncertaintly to be succesful, but even that didn't help you.

Sun, 01/30/2011 - 12:03 | 917748 Hulk
Hulk's picture


Sun, 01/30/2011 - 13:16 | 917855 Math Man
Math Man's picture

GATA is noise.  Gold is a scam.

How do you longs sleep at night, knowing that for your trade to works out, people must die?


Sun, 01/30/2011 - 23:07 | 919165 Hephasteus
Hephasteus's picture

I sleep with my hand wrapped around a 2 lb sledge hammer. How do you sleep?

Sun, 01/30/2011 - 13:20 | 917878 Bay of Pigs
Bay of Pigs's picture

Gee, thanks for clearing that all up for us.

Now go put your head in the sand again.

Sun, 01/30/2011 - 18:08 | 918661 dryam
dryam's picture

Now that the economy is getting back on track


Seriously, are you retarded?

Sun, 01/30/2011 - 19:54 | 918810 Math Man
Math Man's picture

GDP growth was 3.2% last year...  and was orginally estimated to be 2.5%.

The economy IS improving. 

You gold bug losers are just too blind from staring at your bling to realize it.




Sun, 01/30/2011 - 23:10 | 919175 Cathartes Aura
Cathartes Aura's picture

fail troll is fail.

Sun, 01/30/2011 - 23:14 | 919183 Hephasteus
Hephasteus's picture

Inflation was up 10 percent. You're GDP is getting bent over and drilled to death. As the hard cores take down manufacturing it makes your corporations employ meaner and nastier tricks to the remaing sheeps. As the system runs we get more and more converts sick of your abuse. When the levee breaks you're going to get wet.

Sun, 01/30/2011 - 05:02 | 917550 Hephasteus
Hephasteus's picture

Oh shit they found a way to disguise gold. Watch out.


Sun, 01/30/2011 - 07:19 | 917586 Browncoat79
Browncoat79's picture

Won't that just make gold more valuable? Now it's a store of wealth AND an energy source..... It's like oil and metal combined

Sun, 01/30/2011 - 09:59 | 917659 pauldia
pauldia's picture

Excellent and informatve. The one item I rarely see mentionioned has to do with the authority  the President has to seize foreign owned gold held in the U.S. This would come into play in the extreme only and if the Yuan does not depeg.The U.S. has only one way out of it's imbalance and that is the de-pegging of the Yuan. This is a giant game of chicken and do not think the U.S. does not have a plan B. If exporting inflation does not alter the Chinese stance, the President has a Constitutional and legal option. Please see the Int Economic Emergency Powers Act of 1977. This act allows the U.S. to literally seize 7,000 tonnes of foreign gold stored below the Federal Reserve and owned by Foreign Nations. This gold would be moved to West Point, a voucher offered in return and added to the 8,000 tonnes the U.S, claims on its balance sheet. Next a new U.S. currency tied to a % of gold; say 30% to 40% would be created. Gold would rise but not so much as the ratio to the monetary base is greatly reduced. This authority is provided the President and is very similar to the underlying law Roosevelt used to confiscate gold in 1933. Do not think the Chinese have not prepared, they are currently unloading U.S. Treasury holdings via swap windows for European Debt. It is not European Debt they are receiving but the Gold reserves of said debtors. Not to mention vast reserves of commodities, for example coal from PA, WV & KY is being shipped to China where it is allegedly beings stored in Chinese mines. BTW, do you think Tunesia and Egypt’s rising food costs were partly caused by massive printing of the worlds reserve currency?Do you think Hamas or the Muslim Brotherhood worry about rising food costs? If a void in Egypt is filled by Islamists there will be no stopping arms from entering Gaza and all radical regimes are empowered….. & tiny Israel will have Iranian proxies on every border. And who will control the Suez Canal?

Sun, 01/30/2011 - 10:09 | 917664 Snidley Whipsnae
Snidley Whipsnae's picture

If you are going to use Rickard's material you should at least give him credit for it.

Here is the complete James G Rickards interview that you quoted from. Thanks for posting the info but a watch of this complete video is important for anyone interested in the macro picture.


Sun, 01/30/2011 - 11:19 | 917714 pauldia
pauldia's picture

You are 100% correct I respect Rickards greatly and should have cited him. I first heard this on his presentation at John Hopkins via an archived link. Thanks for pointing out my error of omission.

Sun, 01/30/2011 - 10:23 | 917675 moofph
moofph's picture

...great article from usual...and so many in tune to reality i notice after reading all of these posts...and now the trolls will awaken and begin to disguise the truth over their morning coffee. i fear the worst for my country and my fellow americans that continue to disregard reason. i do notice a rise in slow and subtle like drips of water from a spring...time is our ally and it is also the enemy of the deceivers...we shall see victory in many shapes and has been a pleasure to be a part of what ever this is and will become...thanks tyler, thanks readers...and thank you banksters for allowing the sharpest minds to accumulate as much gold and silver as they possibly can through your manipulated greed and

Sun, 01/30/2011 - 11:07 | 917704 satansanus
satansanus's picture

god said i could have anything at anyprice

gold is what its worth in your mind

Sun, 01/30/2011 - 11:29 | 917726 Snidley Whipsnae
Snidley Whipsnae's picture

"god said i could have anything at anyprice"

...he must have been speaking to central bankers when he said that...

"gold is what its worth in your mind" is any asset class... what's your point?

Sun, 01/30/2011 - 11:51 | 917741 satansanus
satansanus's picture

just bein an asshole!

Sun, 01/30/2011 - 12:21 | 917769 buzlightening
buzlightening's picture

Bottom line!  If it burns you aren't holding real money!!  Got out of the ponzi go round 3 years ago!! Closed out banks accounts, got cash being trashed and turned most of it into silver eagles over a 2 & 1/2 year period!!  No debt! No 401k!(Took the 20% hit just to get "MY" funds out of bankster fraudsters hands) Try to put your hands on that  401k cashout now and you'll get paper alright; amountain of paper work and come up with bupkiss lest you have one foot in the grave!  Hardship discharge of money only otherwise you borrow against it!! Tried to get my wifes out after the '08 Fall market crash and redemptions were exiting the market in droves! Best we could do with her 401k was stop paying into it and buy food storage/commodities with that paycheck stipen!!  That move has paid great dividends as inflation chews away the buying power of benron burnokio bucks!!  Litmus test with daisy chain implosions of weak nations getting eaten alive by inflation will be seeing it wash ashore in Americon'd!!  Certainly a benron 20 dollar FRN won't doesn't buy as much in the past so it won't in the future!  On the other hand a silver quarter melt value will put as many FRN's in your hands to buy what you could years ago, today, and into the future as the dollar dies!!  Near dead now as it's only intervention by dead head feds to leave it in an illusion of having an intrinsic value!!  Paper fiat races to zero continually and most AmeriCON'd can't wait to buy their next losing lotto ticket with a devaluing cash; fast becoming trash!!

Sun, 01/30/2011 - 12:23 | 917772 Grand Supercycle
Grand Supercycle's picture

My earlier warnings of a Gold + Silver correction confirmed.

Weekly indicators still warn of significant Gold and Silver downside.

Sun, 01/30/2011 - 13:05 | 917832 digalert
digalert's picture

Tunisia's Ben Ali has caused a major dilema for Egypts Mubarak, running off with Gold. That put alot of focus on Gold and now Mubarak must figure a way to bail with the shiny metal.

Sun, 01/30/2011 - 13:25 | 917888 Vendetta
Vendetta's picture

it feels good to wire transfer my bank money to a precious metals dealer and get physical.  Gets my money out of the hands of a corrupt system.

Sun, 01/30/2011 - 13:57 | 917975 A_MacLaren
A_MacLaren's picture

Very good article, GATA just needs to be careful in its multiple assignment of central banker's central bank role.  Is there one or are there two?

Meanwhile, for years the International Monetary Fund, the central bank of the central banks, has been openly intervening in the gold market by threatening to sell gold and then finally selling some, or at least claiming to have sold some.


Last June the Bank for International Settlements, the central bank of the central banks, disclosed, via a footnote in its annual report, that it had undertaken a gold swap of unprecedented size, 346 tonnes.

Officially, BIS serves this role.

The Bank for International Settlements (BIS) is an international organisation which fosters international monetary and financial cooperation and serves as a bank for central banks.

The BIS fulfils this mandate by acting as:

  • a forum to promote discussion and policy analysis among central banks and within the international financial community
  • a centre for economic and monetary research
  • a prime counterparty for central banks in their financial transactions
  • agent or trustee in connection with international financial operations

The head office is in Basel, Switzerland and there are two representative offices: in the Hong Kong Special Administrative Region of the People's Republic of China and in Mexico City.

Established on 17 May 1930, the BIS is the world's oldest international financial organisation.

As its customers are central banks and international organisations, the BIS does not accept deposits from, or provide financial services to, private individuals or corporate entities. The BIS strongly advises caution against fraudulent schemes.

Including their fraudulent global monetary Ponzi Scheme?


But that noted...

Fuck the fractional reserve banking system, the fucking fractional reserve banksters, their fucking fractionally backed derivatives.

Only hold and invest in Physical Precious Metals.

Sun, 01/30/2011 - 14:20 | 918038 atevan1
atevan1's picture

Same thing happened to me at Bank of the West in CA. I tried to withdraw $3,000 at one branch only to be told I had to go to another branch. I did.  They then told me I couldn't withdraw such a large amount because that branch didn't have enough cash on hand to do so. I eventually talked to the manager and she agreed to give me my money. But they didn't have enough $100's!!! I walked out of there with $2,000 in $20 notes. It was ridiculous. 

Sun, 01/30/2011 - 14:34 | 918073 Jerry Maguire
Jerry Maguire's picture

How does gold at about $25,000 per ounce sound?

That's the result of the proposed constitutional amendment.  In addition, the gold would be taken from the Federal Reserve for distribution to savers, reversing the confiscation of gold from the 1930's.  But we have to hurry.  Cairo is a wake-up call.

And there are a few other related posts to peruse:


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