42 Years of Fractional Reserve Alchemy

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42 Years of Fractional Reserve Alchemy

Posted with permission and written by Craig Hemke (CLICK HERE FOR ORIGINAL)




It has now been 42 years since The Global Bankers successfully alchemized gold through the advent of futures trading, so we begin the new year by looking back at how we got into this position in the first place.


To that end, let's start 2017 by going back to 1974.


Over the past few years, you've often heard me reference the HISTORY and FACT of gold price suppression and manipulation. Whenever it comes up in an interview or presentation, it often goes like this:


  • After Bretton Woods, the US tried to go it alone in managing the price of gold to $35/ounce. By the late 1950s, this caused a mini-crisis when US gold reserves fell by a third as countries around the world exchanged their dollars for gold. There were hearings on Capitol Hill and decisions were made to change the way that $35 gold would be managed.
  • This led to the formation of The London Gold Pool in 1961. No longer would the US go it alone in providing physical metal at the $35/ounce price. Seven other countries were recruited to the effort in order to lessen the burden and drawdown of US reserves. This effort to manage the $35 price worked for nearly seven years until global gold demand finally overwhelmed the Gold Pool and the effort collapsed in 1968.
  • The US was suddenly on its own again and demand for gold in exchange for dollars soon grew to such an extreme that President Nixon was forced to cancel the dollar's convertibility into gold on August 15, 1971. This is the "closing of the gold window" that you've heard so much about.


A new movement to allow private gold ownership in the US soon began...recall that FDR had outlawed private gold ownership in 1933...and on January 1, 1975, US citizens were finally allowed to once again own and hold physical gold.


But something very important happened the day before, on December 31, 1974. On that date, the Commodity Exchange Inc., also known as The Comex, began trading gold futures contracts and, as you'll see below, it was through these gold derivative contracts that the global bankers and governments finally perfected alchemy...a pursuit which had foiled and baffled scientists for centuries.


You may recall that a few years back, Wikileaks unveiled a whole assortment of previously-classified US government cables and transmissions. Wikileaks documented them all together and posted them to their website under the category of "Public Library of US Diplomacy". From the site, please read through this cable from December 10, 1974:



The entire document lays bare the intention behind the manufacture of gold derivatives to replace physical metal. However, in case you missed it, here's the key paragraph:



And there you have it. Laid bare for all to see. The "Dealers' expectations" of 1974 are manifest in 2017. The futures market is "of significant proportion" and physical trading is "miniscule by comparison". Price suppression, manipulation and volatility has "negated long-term hoarding" of gold by US citizens and very few even consider gold as money at all with the vast majority seeing it only as a commodity or a "hedge".


However, the fraud of the Banker's alchemy will one day come to an end as confidence in fiat currency collapses and physical demand for real money overwhelms this fractional reserve system. Will/can this occur in 2017? It's certainly possible as negative interest rates and currency devaluations lead to all sorts of unexpected consequences. But the timing hardly matters when the end result is a foregone conclusion. No system built upon a foundation of deceit and fraud can stand the test of time, and the Banker's fractional reserve alchemy is no different. It will one day collapse. Of that you can be certain.


(A major h/t to James Henry Anderson for reposting the Wikileak page to Twitter on January 1.)



Please email with any questions about this article or precious metals HERE






42 Years of Fractional Reserve Alchemy

Posted with permission and written by Craig Hemke (CLICK HERE FOR ORIGINAL)

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JailBanksters's picture

Even with all the Fraud, Money Laundering, Tax Avoidance, Cheating, Stealing, Manipulation, Neutral Interest Rates, Ponzi Schemes, Banks are still not profitable and  are still looking for the next Bail-out.

DemandSider's picture

We'd still have a manufacturing surplus and a growing middle class were it not for the petrodollar and other means of over valuing, which was applied to all of OPEC in 1975. 1975 was also our last year of trade surplus, and we've been going deeper into international debt ever since. Future historians will acknowledge that Communist China won the cold war, with a lot of help from the wealthy parasite class, exemplified by Kissinger and Associates.

Stud Duck's picture

I am into brass and lead. It has a utility, can be used as a medium of exchange as well as a storage of value in measurable amounts.. When ammo gets short its utility adds to its value imeasurably!

ebworthen's picture

"Lead into Gold", uhm-hum, alchemy indeed.

Escapeclaws's picture

The solutuion is to have money printed by the federal government and not borrowed at interest from the fed. That's why Kennedy was assassinated.

micmac's picture

in fiat we thrust 

jharry's picture

Maybe the bitcoin computers and electronic fiat will go dark too.

squid's picture

Still remeber Greenspan at the CFR having to explain to the idiots 'why' gold is money. Because it represents not a promise to pay but is payment in and of itself.


Fucking neocons still don't understand.


All fiat currencies collapse, 100% failure rate.




Who the fuck knows.



DarkPurpleHaze's picture

Let's talk about your laughable 2016 prediction that you hoped no one remembered....


“A Timeline For The Next Rally In Gold”

“It’s still possible that gold could trade AS LOW as $1285 and back near its 50-day moving average before bottoming. This area has proven as support all year.”

“Then, finally, a breakout to new 2016 highs in October and November.”
“This year-end rally should take gold all the way back to near the April 2013 manipulated breakdown level of $1525. Let’s call it $1475-$1525.”

“So there you go. That’s what WE expect.
If I’M proven correct, I’LL gladly take all the ADULATION that comes this way.”


What's the excuse this year?

The Saint's picture
The Saint (not verified) DarkPurpleHaze Jan 5, 2017 4:09 PM

Gold bugs act like gold bugs act.  Nothing different is to be expected of them.  Hedge accordingly.


DarkPurpleHaze's picture

Classic B.S. artist bullet point...


Twitter/TF Metals Report ‏@TFMetals
This is brilliant stuff. The author must be some kind of genius.



Yep, you have a firm grip on how to regurgitate meaningless old news offered up as FAKE ANALYSIS pretending to be relevant today.

jharry's picture

Jim Wilie, Jim Willie, Jim Willie, but I still like him.

DarkPurpleHaze's picture

You can file the above prediction under this category...


He’s a bullshit artist that comes off as genuine to those who like the message.

The most prevalent definitions of a Bullshit Artist are:

• “A person expert at deception, and hype.”

• “A person with a talent for convincing lies.”

• “A person who habitually exaggerates, flatters, or talks nonsense.”

• “A person who lies/boasts incessantly, usually to comedic effect, intentional or accidental.”

• “A person who specializes in a field of feeding its surrounding persons with uselessness.”

• “A true master of verbal façade who gets off on selling worthless information as if it was fact.”

People seeking notoriety, adulation/vindication/validation etc. generally fall under B.S.r’s or just garden variety narcissists. You Tube is loaded with their self-importance.

Who in their right mind keeps putting their fictional third person name and faux integrity on the line while continuously making wildly wrong predictions year after  year while still insisting that they’re right year after year…and then ask people to believe or support their B.S. no matter what?

Typical internet shill/carny just like Jim Kramer is on TV. 

LawsofPhysics's picture

All fine and good and as someone who controls productive capacity I will still accept physical PMs in exchange for all the food we produce.

Good luck!

Able Ape's picture

Having PMs and living near Amish farmers is probably the best insurance one can buy for a financial system that resembles a crack whore...

Herd Redirection Committee's picture

Fiat currency, fractional reserve banking, and usury.  People need to know there is an alternative.

Same with 'Basic Income', it can be funded with debt (!!!) or society can choose the route of 'Social Credit'!

jharry's picture

Social Credit as designed by Douglas and espoused by Dick Eastman is a way of making the citizenry powerful by distributing the nation's; profits directly to the people and not to the banksters.  Money will flow to useful things in the form of private purchases. Banks will becoome transaction centers and nothing more.

It's a good idea. 

LawsofPhysics's picture

LOL!  The "basic income" is in fact zero. If you don't do real work, then you do not eat, period.

jharry's picture

Robots work.  Humans won't have to.

bogbeagle's picture

The field niggers work.  Whites don't have to.


Not sure that it's a stable formula.

Herd Redirection Committee's picture

Well, that is a good question if we should live in a society that creates no new money, or only gold (and or silver) is monetized (thus new supply comes from being mined+ refined), or creates new money via 1s and 0s as decided by Wall St banks, OR new money is introduced to the economy via social credit.

How society should handle the ever-increasing mechanization and automation of industrial/commercial processes is also a good question.

11b40's picture

Really the most complicated questions we face are about money and jobs, with the jobs situation growing worse by the day.  Bumper sticker answers like 'if you don't work, you don't eat' are simple minded answers from simple minded people.

J S Bach's picture

"No system built upon a foundation of deceit and fraud can stand the test of time, and the Banker's fractional reserve alchemy is no different."

It's not designed to "stand the test of time".  Its purpose is to steal as much real wealth from the ignorant masses before the ensuing "reset" into the next scam cycle.