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Gold and Silver Prices Are Set In Libor-Like Daily Conference Calls Between a Handful of Big Banks

George Washington's picture





 

There is increasing evidence that the gold market is manipulated.  The amount of physical bullion may be greatly over-stated, and gold may be manipulated in the same way that Libor rates are:

The Telegraph noted Monday:

[Bank of England executive] Paul Tucker told MPs that Barclays’ abuse of the Libor system may be only one part of the banks’ dishonesty over crucial financial information, suggesting that other markets should now be investigated.

An official inquiry into Libor – which helps determine interest rates for householders and businesses – should be broadened to include several over markets where banks are trusted to report their own data, he said.

 

***

The Libor scandal could be repeated in a number of other “self-certifying” markets where prices are determined, he said.

 

“Self-certification is clearly open to abuse, so this could occur elsewhere,” he said.

A Financial Services Authority inquiry into Libor should be extended to other self-certifying markets, he said. The Treasury said last night that the review, led by Martin Wheatley, was free to examine markets other than Libor.

 

***

 

Some markets in gold and oil are also based on self-certification.

Mainstream commentators are starting to publicly discuss manipulation in the precious metals markets.  See this, this and this.

 

Avery Goldman noted last year:

On March 15, 2011, the Commodity Exchange (COMEX) and the New York Mercantile Exchange (NYMEX) advised the CFTC that they had approved J.P. Morgan’s application to become a licensed vault facility, using a “self-certification” process. The newly licensed vault, located at 1 Chase Manhattan Plaza, NY, NY, is ready to roll as both “weighmaster” and depository, for delivery of gold, silver, platinum and palladium contracts, as of March 17, 2011, two days later.”

ETFs, bullion banks, storage facilities and other holders of gold that are “self-certifying”  – without any checks by third party auditors – have been caught misreporting and raiding even allocated precious metals accounts, and using the loot to speculate or pay off other debts.

 

As such, manipulation in the self-certifying portions of the oil and gold markets could have a huge impact on assessing the true health of financial institutions, the economy as a whole, and the assets of individual investors.

Yesterday, the Guardian reported on the stunning similarities between the daily “fixing” of the gold price and of the Libor rate:

London’s financial sectorwas last night bracing itself for another official investigation into alleged price-fixing following reports that a US regulator is considering launching an inquiry into the City’s gold and silver markets.

 

The Commodity Futures Trading Commission is discussing whether the daily setting of gold and silver prices in London is open to manipulation, according to the Wall Street Journal, which stated that the CFTC is examining whether prices are derived sufficiently transparently.

 

The system of setting gold prices in London is unusual and involves a twice-daily teleconference involving five banks – Barclays, Deutsche Bank, HSBC, Bank of Nova Scotia and Société Générale – while silver is set by the latter three. The price fixings are then used to determine prices worldwide.

 

***

 

The fixing of the gold price in London dates back to September 1919, when the process involved NM Rothschild & Sons, Mocatta & Goldsmid, Samuel Montagu & Co, Pixley & Abell and Sharps & Wilkins.

 

At the start of each gold price-fixing, the chairman announces an opening price to the other four members who relay this price to their customers. Based on orders received from them, the banks declare themselves as buyers or sellers at that price.

 

Provided there are both buyers and sellers at that price, members are then asked to state the number of bars they wish to trade.

 

***

 

If at the opening price there are only buyers or only sellers, or if the numbers of bars to be bought or sold does not balance, the price is moved and the same procedure is followed until a balance is achieved. The silver fix dates back to 1897.

 

 


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Thu, 03/14/2013 - 18:17 | Link to Comment Atlas Crapped
Atlas Crapped's picture

"London’s financial sector was last night bracing itself for another official investigation into alleged price-fixing following reports that a US regulator is considering launching an inquiry into the City’s gold and silver markets."

Are you fucking kidding me? This is pure theatrics, and really - it's an insult to any thinking man's intelligence.

And then this: "Mainstream commentators are starting to publicly discuss manipulation in the precious metals markets."

Really?? Uh, about 15 years late on that one, but I guess if the banks who own the mainstream media are finally ready to kill off the paper gold system, they can play their "bad guy" part and pretend to be wrist slapped by "a US Regulator". After all, the only thing bigger than their bonuses are their egos, and since they have that confused with the size of their peckers, they've been waiving those behind our asses for years preparing for the final PLUNGE.

So the tide seems to be turning it the direction of the closing act where the fascist government pigs on THIS side of the revolving door get to bitch slap the commercial banking pigs on THAT side of the revolving door, and the bullion banks are crucified (just like I've always said) and the central banks come to the rescue with revalued gold.

All we need is for the last legs of international support to be kicked out from under the dollar, followed by a Weimer melt-up, and then in comes the BIS on its white horse.

All coming to a Kubuki theater near you.

Thu, 03/14/2013 - 18:00 | Link to Comment steve from virginia
steve from virginia's picture

 

 

 

Surprise, the markets are manipulated.

 

I guess that means people will have to think for themselves ... boy, that's a toughie!

 

 

Thu, 03/14/2013 - 17:50 | Link to Comment paint it red ca...
paint it red call it hell's picture

Damn! Has anybody alerted the CFTC?????????????????????

Thu, 03/14/2013 - 16:35 | Link to Comment A82EBA
A82EBA's picture

so why did they let it get near $1900 when they can suppress it at any time?

Thu, 03/14/2013 - 16:57 | Link to Comment SWCroaker
SWCroaker's picture

Is like collecting BMWs; he who holds the most @ the end ... wins.    Game isn't to have the most @ every instant.   If Au hadn't made it to $1,900, then the last 2 years would not have provided nearly the level of disillusionment, and the grannies and gramps that coughed up their jewelery into BUY GOLD stores wouldn't have been so eager, and then the amount of scrap that got refined, exported as a consequence of oversees buying would have actually hurt more.

When the music stops, Au will be concentrated densely in sovereign and CB hands.  Crushing hope for the little people involves beatings AND REWARDS; beatings alone just make jack stubbornly mulish.

Thu, 03/14/2013 - 15:53 | Link to Comment Mad Mohel
Mad Mohel's picture

Line those motherfuckers up and introduce them to the lead and copper market, at 3250 ft/s.

Thu, 03/14/2013 - 16:33 | Link to Comment johnnymustardseed
johnnymustardseed's picture

These fuck sticks can launder drug money and still be primary dealers with the FED and get free money. They  will be allowed to do this becasue the Central Banks need them to support the fiat.

Thu, 03/14/2013 - 17:53 | Link to Comment paint it red ca...
paint it red call it hell's picture

Pricks have probably got AIG writing credit default swaps against their short positions.

Thu, 03/14/2013 - 16:24 | Link to Comment Dieselclam
Dieselclam's picture

"...introduce them to lead and copper markets, at 3250 feet per second."

All you will succeed in doing is creating a free market...based in manipulated fiat currency. What a pisser.

When Rothschilds quit their daily price fixing in 2004, it was a foregone conclusion that someone else was going to step in and take over that practice: Rothschild stooges, of course.

Thu, 03/14/2013 - 15:49 | Link to Comment MGA_1
MGA_1's picture

Oh... quite the mess - and may eventually end in a crisis - or the entire world asking for delivery and the fed promising in 7 years ;)

Thu, 03/14/2013 - 15:47 | Link to Comment sixbilliondollarman
sixbilliondollarman's picture

Why do we even discuss this SHIT?!?! Is there nothing else to write about [like the DOW funkin Jones going up every GODDAMN day because of the PRINTING OF MONEY]...so be it*

 

FIRST: The CFTC is a defunct bogus regulatory agency with NO CREDIBILITY. After Corzine ripped off segregated account holders with MF Global & Wassendorf did the same @ PFG...I'll say this ONCE...ready?

"THE FINACIAL INTEGRITY OF THE FUTURES MARKETS IS GONE FOREVER NOW." NEVER TO BE RE-CAPTURED.

Therefore: The CME GROUP, The CFTC, The NFA & the Price discovery mechanisms of their markets ARE NOT VALID.

 

Nobody [who is aware & awake] fuckin cares what these lymies or CFTC jackoffs think care or do.

SPOT & FUTURES market metals prices are not accurate & haven't been since CORZINED.

 

Go fuckin try to buy an ounce of Silver for 29 bux Spot or Futures [pick one of your choice]...you are gonna fuckin pay about 5 bucks higher...whether it's Vinnie on the street corner...or a legit coin shop...IF THEY HAVE ANY to sell you.

Gold too...the physical will cost you 85$ to 100$ bux high then the SPOT or Futures scam price [if someone has it to sell you]

WHY even dicuss these criminals???

It's like pointing out the "techniques of a child molester"- do we need to know or care any longer???

Thu, 03/14/2013 - 16:35 | Link to Comment Panafrican Funk...
Panafrican Funktron Robot's picture

The truly fucked part about this is that, in the wake of the Libor scandal, the same fucking banks are still setting fucking Libor.  The CTFC deciding to shake down these banks again for cash, probably for the same reason, to deflect criticism of the theivery.  

Thu, 03/14/2013 - 16:35 | Link to Comment Radical Marijuana
Radical Marijuana's picture

I wish that I could agree with you more, sixbilliondollarman! However, these criminals effectively control the police, who can kick down your door, and then put you in a cage, if you do not do what the bankster controlled government says you should do. Therefore, it is quite difficult to ignore them! ... I sympathize with your attitude ... BUT ...

Thu, 03/14/2013 - 16:57 | Link to Comment 1000924014093
1000924014093's picture

You really like those italics, don't you Radical Marijuana?

Thu, 03/14/2013 - 16:57 | Link to Comment 1000924014093
1000924014093's picture

You really like those italics, don't you Radical Marijuana?

Thu, 03/14/2013 - 15:26 | Link to Comment Atlantis Consigliore
Thu, 03/14/2013 - 15:25 | Link to Comment Atlantis Consigliore
Atlantis Consigliore's picture

CFTC SEC ABC NBC CNBC Framer and the morons all selling ad space tv time for BUY GOLD...lol

like buy stocks....sure suicker 

Thu, 03/14/2013 - 15:21 | Link to Comment MrMorden
MrMorden's picture

I'm sure CFTC will conclude there is nothing to see here.

Thu, 03/14/2013 - 14:56 | Link to Comment Joebloinvestor
Joebloinvestor's picture

Like this is a FUCKING suprise.

If anything can be manipulated and a profit made, IT WILL BE.

If anything can be adulterated and a profit made, IT WILL BE.

Self policing is a joke and the UK became the financial "hub" based on a bunch of FUCKING LIES and DECEPTIONS till they got caught.

The non-suprise of this is of course the UK regulators were clueless.

The UK isn't the only shit in the pile either.

Illinois gets caught LYING about securities it sold, but does it get banned from selling any financial product in the future?

NO.

Does it get fined?

NO.

You don't have to go over the pond to find pond scum.

 

Thu, 03/14/2013 - 16:31 | Link to Comment Radical Marijuana
Radical Marijuana's picture

YES, Joebloinvestor! After the banksters had already gained the ability to make "money" out of nothing, then rigging the price of any commodities is relatively simple for them to do. The banksters effectively control all the biggest governments in the world, to force everyone else to accept their runaway triumphant frauds.

Thu, 03/14/2013 - 14:42 | Link to Comment akak
akak's picture

I don't remember the exact name of the piece or the author of it, but two or three years ago there was an article being circulated online in the major PM-related websites that demonstrated that well over 90% of the daily PM fixes in the London and/or New York markets were lower than the corresponding AM fixes, even in the face of a decade-long bull market in the precious metals and despite consistently higher PM fixes over AM fixes in the Asian markets durign the same period, something which was statistically virtually impossible assuming a free and unmanipulated market.

Does not this, in and of itself, prove (Western) manipulation in the PM markets?

Thu, 03/14/2013 - 16:50 | Link to Comment akak
akak's picture

Thanks Panafrican!

Thu, 03/14/2013 - 14:12 | Link to Comment observer007
observer007's picture

World Gold Council (WGC) projects continuing gold purchases by central banks 

 

The World Gold Council expects central banks to intensify their efforts to diversify their currency reserves this year and, among other things, to buy gold given that gold is under-represented as compared with currencies.

http://homt.com/wgc-gold-purchase-central-banks

Thu, 03/14/2013 - 14:11 | Link to Comment NoWayJose
NoWayJose's picture

This is not that much different than the initial price discovery at the opening of the stock markets - basically they are just trying to balance the buy and sell orders.  I don't see this as direct price manipulation, although it does offer a huge advantage to the banks setting the price.  If they see a cheap price and no buyers, they can step in with their own buy orders - and vice versa.  Real manipulation is the flooding the market with buy or sell orders, and doing so at designated times.  We have seen the London fix be 'normal', then right before the US open, the crash comes.

Thu, 03/14/2013 - 13:56 | Link to Comment Mr. Hudson
Mr. Hudson's picture

According to Eustace Mullins, this has been going on since the late 1800's. In fact, when we were under a bi-metal standard under Grover Cleveland, the Bank of London would set the price of gold to manipulate silver, and vice versa.

Thu, 03/14/2013 - 16:29 | Link to Comment Radical Marijuana
Radical Marijuana's picture

Yes, Mr. Hudson, as I hkave presented more details about in some previous comments, another crucial commencement point of the corruption of the American financial system was back in 1874, when a sneaky legislative trick demonetized silver.

Thu, 03/14/2013 - 13:54 | Link to Comment astoriajoe
astoriajoe's picture

.nevermind.

Thu, 03/14/2013 - 13:50 | Link to Comment joego1
joego1's picture

They can fix the price until there are no sellers left.

Thu, 03/14/2013 - 14:05 | Link to Comment Peter Pan
Peter Pan's picture

Fully agree.

Thu, 03/14/2013 - 13:52 | Link to Comment Xibalba
Xibalba's picture

there's always a seller....whether or not they own what they're selling is another issue....

Thu, 03/14/2013 - 13:44 | Link to Comment boeing747
boeing747's picture

There is ongoing media campaign against Gold since German wanted their golds back. Looks today's financial.yahoo.com says: 'Gold could be $1000'. We are entering final stage of Gold ponzi when even market manipulation doesn't work.

Thu, 03/14/2013 - 13:37 | Link to Comment Peter Pan
Peter Pan's picture

Why is this news?

Thu, 03/14/2013 - 16:24 | Link to Comment Radical Marijuana
Radical Marijuana's picture

Well, dear perpetually young Peter Pan, the only reason that this is "news" is that it is becoming so blatant that it is forcing itself into more mainstream awareness. Of course, this is not new to some small groups of people. However, it is new to many larger groups of people.

After reading many different articles by George Washington for a few years, I think that what he deliberately does is position his writing to be just on the edge of significant stories which are breaking into the mainstream awareness. I get the impression that he deliberately restrains himself from pushing too far out in front of that. To me, it appears that he tries to catch the bigger waves, just as they are cresting into more mainstream awareness, and then presents that information in ways which more of the mainstream morons will be able to understand and agree with.

Of course, that does not seem much like "news" to the smaller groups of intellectuals, who have worked at trying to become better informed about these issues for many years. However, it IS "news" to most other people, and, as I said, it appears to me that George Washington, as an author, works hard to try to stay abreast of just where the alternative news is crossing over into to the more mainstream, to the extent that that is possible, at the time that he is writing.

Thu, 03/14/2013 - 13:43 | Link to Comment George Washington
Thu, 03/14/2013 - 14:01 | Link to Comment Peter Pan
Peter Pan's picture

Loosen up George. You are still not telling me anything I don't know. What I do want to know is how you prpose to put an end to this practice.

By the way, I think your pieces always make good reads.

Thu, 03/14/2013 - 14:39 | Link to Comment blueRidgeBoy
blueRidgeBoy's picture

seems like he's questioning your motives (Textbook number 14, for those keeping score)

Thu, 03/14/2013 - 13:34 | Link to Comment Dr.Evil
Dr.Evil's picture

The problem is that the Chinese can freely take advantage of these depressed prices. However one day when they can not convert they treasury holdings to more physical the whole system will blow up. By that time most of the gold and silver will be in the east, so the Chinese will have no problem with the parabolic price increases. At this point these banks will not have any leverage left to keep manipulating the prices. This will effectively destroy the western money system as we know it.

Thu, 03/14/2013 - 13:33 | Link to Comment JailBank
JailBank's picture

I would never guess that in an industry that has the upmost confidence and respect of the common man like banking that there would be manipulation of the system. Shocked at it all, shocked.

Thu, 03/14/2013 - 13:13 | Link to Comment Jack Sheet
Jack Sheet's picture

Absolutely shocking!

Thu, 03/14/2013 - 13:09 | Link to Comment StarTedStackin'
StarTedStackin''s picture

Manipulated? Really?

Thu, 03/14/2013 - 13:14 | Link to Comment Ghordius
Ghordius's picture

it's not manipulated if all megabanks agree it isn't. after all, we had the mess only because one of them disagreed

Thu, 03/14/2013 - 13:14 | Link to Comment Terminus C
Terminus C's picture

I don't believe that the good people of those venerable institutions would manipulate the price, they are merely custodians of a transparent and free market. The reason these fine folk are so rich is because they are really smart... And principled...

Thu, 03/14/2013 - 15:06 | Link to Comment jeebus
jeebus's picture

Hard to argue with such fine logic. I believe we just have a bunch of fools here. The more money they print, the richer we'll all get. Why else is the stock market up?

Thu, 03/14/2013 - 13:51 | Link to Comment A. Magnus
A. Magnus's picture

"I don't believe that the good people of those venerable institutions would manipulate the price, they are merely custodians of a transparent and free market. The reason these fine folk are so rich is because they are really smart... And principled...

/sarc"

There...fixed it for ya!

Thu, 03/14/2013 - 13:15 | Link to Comment Ghordius
Ghordius's picture

and make more money than you and me? ;-)

Thu, 03/14/2013 - 13:43 | Link to Comment Manthong
Manthong's picture

Mercy sakes! Why ever would they would they want to do that?

Oh, because when it is all said and done, gold actually determines government bond prices..

This whole interview is critical to understanding the scam but jump to  17:40 for the money shot.

http://www.youtube.com/watch?v=T0jpso4jDC4



Thu, 03/14/2013 - 17:58 | Link to Comment Buck Johnson
Buck Johnson's picture

Amazing, also this whole game will come to an end real soon.

Thu, 03/14/2013 - 16:31 | Link to Comment A82EBA
A82EBA's picture

very cool, thanks

Thu, 03/14/2013 - 14:05 | Link to Comment gmrpeabody
gmrpeabody's picture

Say it ain't so...

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