As we’d promoted back in September and October, Chris Powell of the Gold Anti Trust Action Committee (GATA) was in New Zealand on Sunday 13th October, before then heading to Australia to also speak at the Gold Symposium in Sydney.
For those that consider GATA simply as a conspiracy theory website, it is worth knowing that Chris Powell’s “day job” is as the editor of a newspaper. He is not one for giving rants based purely upon suspicion, speculation and innuendo. As his speech showed, and if you have ever followed anything that he writes on the GATA website, he believes firmly in gaining written evidence to support the thesis that gold is manipulated. During his speech he referenced dozens of documents including from the likes of the “Central Bank for Central Banks”, the Bank for International Settlements (BIS) and the (International Monetary Fund) IMF. So while we are yet to see a Central Banker stand up publicly and say “Yes I did it”, there is a good deal of evidence pointing to what some might prefer to call interference, or price management in the precious metals markets.
He also gave the gold mining industry itself a “serve”, as he believes they have been derelict in not offering any kind of resistance to the gold market intervention.
We’d written up some notes and have been looking at summarising the content of Chris’s speech. However as already mentioned, the speech that Chris gave was so jam packed with references to a multitude of documents in the public sphere, that we have been having trouble working out what to include and what to leave out!
Luckily Chris has now posted his full speech on the GATA website. So we have reposted it below. While it is lengthy it is worth reading through as it gives a fabulous summary of all the key information that GATA has collected over the years and links it all together rather well.
On top of the speech itself there was also a Q&A session at the conclusion.We’ve included our summary of his answers to these from both his Auckland and also Sydney presentation. Scroll right to the end of the speech to the heading Q&A to read these. Now on to Chris Powell’s speech…
Remarks by Chris Powell, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Louis Boulanger Now Seminar
Visitors Center, Holy Trinity Parnell
Auckland, New Zealand
Sunday, October 13, 2013
Gold Investment Symposium 2013
Luna Park Conference Center, Sydney, Australia
Thursday, October 17, 2013
Most financial journalism and most academic teaching maintain that gold is at best a quaint antique. I’m here to argue that gold not only remains money but may again be the best and most important money — to argue that, even more than this, gold is in fact the secret knowledge of the financial universe.
Gold already is so important that Western central banks — particularly the U.S. Treasury and its Exchange Stabilization Fund, the Federal Reserve, and allied central banks — rig the gold market every day, even hour by hour, to control and usually suppress gold’s price.
Why do Western central banks rig the gold market?
It’s because gold is a powerful competitive international currency that, if allowed to function in a free market, will determine the value of other currencies, the level of interest rates, and the value of government bonds. Gold’s performance is usually the opposite of the performance of government currencies and bonds. Hence central banks fight gold to defend their currencies and bonds.
The problem is that central bank tactics in this fight affect more than gold; they affect markets generally and eventually destroy markets generally. This destruction of markets now has a name, a name used even by former members of the Federal Reserve Board. That name is “financial repression.”
There is much academic literature confirming gold’s influence on currencies, interest rates, and government bonds throughout history. Prominent in this literature is the study written by Harvard economics professor Lawrence Summers and University of Michigan economics professor Robert Barsky and published in August 1985 by the National Bureau of Economic Research, a study titled “Gibson’s Paradox and the Gold Standard.” As with all the documents I’ll cite today, the Summers and Barsky study is posted at my organization’s Internet site, GATA.org:
Summers went on to become deputy treasury secretary and then treasury secretary of the United States and president of Harvard University and recently almost became chairman of the Federal Reserve Board, so his study of gold’s influence on currencies, interest rates, and bond prices may be good authority. The Summers and Barsky study implied that governments could achieve their ideal of low interest rates and strong government bond prices by getting control of the price of gold.
As it turns out, controlling the currency markets generally long has been the most efficient mechanism of imperialism. There is much history of this as well.
Rigging the currency markets was the primary mechanism by which Nazi Germany expropriated occupied Europe during World War II. Expropriation by force of arms was actually only a small part of the Nazi conquest. The rigging of the currency markets — that is, the gross distortion of exchange rates in Nazi Germany’s favor — turned every citizen of an occupied country into an agent of the occupation every time he used money. This currency market rigging directed all production in the occupied countries into Nazi Germany and blocked any return flow of production. It enabled Nazi Germany to run without consequence the same sort of fantastic trade deficit run in recent years by the United States.
The United States learned all about the Nazi expropriation of Europe through currency market rigging because it was documented by the November 1943 edition of the U.S. War Department’s monthly intelligence letter, Tactical and Technical Trends:
Nazi Germany’s manipulation of currency markets is also described in detail in the 2005 history “Hitler’s Beneficiaries” by Gotz Aly:
How do Western central banks and particularly the U.S. government rig the gold market?
They used to do it conventionally and in the open by dishoarding their gold reserves at strategic moments, and then by dishoarding their gold reserves regularly, more often, even every day, as the United States, United Kingdom, and seven of their Western European allies did during the 1960s through a public operation called the London Gold Pool. The London Gold Pool held the gold price at $35 per ounce until it collapsed in March 1968 under rising demand that drained the U.S. gold reserve from 25,000 tonnes down closer to the 8,100 tonnes officially reported today:
After the collapse of the London Gold Pool the United States and its allies regrouped to figure out how to rig the gold market surreptitiously — not just with dishoarding but also with the so-called leasing of gold; with the issuance of gold derivatives, including futures and options; and, more recently, with high-frequency trading undertaken through investment houses that are happy to serve as government’s intermediaries in the gold market, since they can front-run government trades. When the rigging is done surreptitiously like this, much less central bank gold has to be dishoarded and the dishoarding that is done has far more suppressive influence on the price.
But Western central bank market rigging goes far beyond gold.
In an essay published in 2001 and titled “The Debasement of World Currency — It Is Inflation, But Not as We Know It” —
— the British economist Peter Warburton discerned that central banks were using investment banks to issue derivativesthroughout the commodity futures markets to siphon away money that was seeking a hedge against inflation. That is, derivatives siphon money away from the hoarding of real goods, hoarding that would drive up consumer price indexes and make inflation even more obvious to the markets and the public. Most of these derivatives are essentially naked short positions that cannot be covered.
Warburton concluded that the prerequisite of a hedge against monetary debasement would have to be some asset that was not associated with a futures market. He suggested good farmland and clean water supplies. For as the saying goes: “The futures markets are not manipulated; the futures markets are the manipulation.”
This market rigging by central banks and their intermediaries explains the great disparagement of gold today: that, despite its tremendous price increase over the last decade, gold has not kept up with inflation since the metal’s last great rise around 1980. Somehow no one who disparages gold asks why it has not kept up with inflation. The answer is that gold derivatives have created a vast imaginary supply of gold for which delivery has not been demanded, since most gold investors choose to leave their gold purchases on deposit with the bullion banks that sold them the imaginary gold.
As a result the world now has a fractional-reserve gold banking system that is leveraged in the extreme.
Yes, all commodity futures markets have created paper promises of supply that could not be covered by real product and have always been settled in cash. But most commodity markets are for goods that eventually are delivered and consumed to a great extent.
Gold is different, for gold is not consumed but rather hoarded, as a means of exchange, as money, even as most gold purchased in the futures markets is never delivered at all but rather left on deposit with those financial institutions that purport to sell it. This system has produced a very disproportionate amount of imaginary, elastic, but undeliverable supply, even as people buy gold precisely because they assume that its supply is not elastic, that its supply is limited to total past production plus annual mine production.
That assumption is a terrible mistake.
While the principle of most gold investment analysis is “You can’t print gold,” “paper gold” can be printed to infinity just like regular government currency — and indeed has been printed practically to infinity.
You can get an idea of the vast imaginary supply of gold by reviewing the incomprehensibly huge gold and interest rate derivative positions attributed to the U.S. investment bank JPMorganChase in the reports of the U.S. Comptroller of the Currency. These derivative positions are almost certainly not JPMorganChase’s own positions at all but, as GATA consultant Rob Kirby of Kirby Analytics in Toronto has written, rather U.S. government positions effected through MorganChase:
After all, the U.S. Treasury Department’s Exchange Stabilization Fund is expressly authorized by law, the Gold Reserve Act of 1934, as amended, to trade secretly in all markets, including the gold market, on the U.S. government’s behalf. And the law expressly exempts the ESF from answering to anyone but the treasury secretary and the president:
Gold market expert Jeffrey Christian of CPM Group testified to a hearing of the U.S. Commodity Futures Trading Commission on March 25, 2010, that the ratio of “paper gold” to real metal in the so-called London physical market may be as high as 100 to 1:
Last January a report by the Reserve Bank of India estimated the ratio of paper gold to real gold at 92 to 1:
Christian provided a similar account of the manufacture of “paper gold” in his essay “Bullion Banking Explained,” published in 2000:
Some international investment houses are on the short end of this enormous leverage and are existentially vulnerable to a short squeeze. It is highly unlikely that they would put themselves in such a position without assurances of emergency support from central banks — and indeed the investment houses have received such assurances many times in public statements by central bankers.
For there are many official admissions of gold market rigging.
These include statements by four former chairmen of the U.S. Federal Reserve Board (Alan Greenspan, Paul Volcker, Arthur Burns, and William McChesney Martin); the minutes of the Federal Open Market Committee; declassified U.S. Central Intelligence Agency and State Department memoranda, including one that cites the necessity for the U.S. government to remain “the masters of gold” —
— statements by central bankers from other countries, including three officials of the Bank for International Settlements; and documents from the BIS and International Monetary Fund.
— In testimony to Congress in July 1998, Federal Reserve Chairman Alan Greenspan declared that “central banks stand ready to lease gold in increasing quantities should the price rise.” Thus Greenspan confirmed that the purpose of gold leasing was not what was usually claimed — to earn central banks a little money on their supposedly dead asset in their vaults — but rather to suppress the monetary metal’s price:
— At GATA’s prodding in January 2012 former Federal Reserve Chairman Paul Volcker admitted to a financial journalist that central banks need to suppress the gold price to stabilize exchange rates at what he called a “critical point”:
Volcker already had written in his memoirs that in 1973 as a U.S. Treasury Department official he advocated gold price suppression:
— In 2009 a remarkable 16-page memorandum was discovered 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.” The memo is a detailed plan of surreptitious intervention by the U.S. government to rig the currency and gold markets to support the U.S. dollar and to conceal, obscure, or even falsify U.S. government records and reports so that the rigging might not be discovered. This document remains on the Internet site of the Federal Reserve Bank of St. Louis:
It is also posted at GATA’s Internet site:
— In a letter to President Gerald Ford in June 1975, Federal Reserve Chairman Arthur Burns reported a secret agreement with the German Bundesbank to obstruct market pricing for gold. Burns wrote to the president: “I have a secret understanding in writing with the Bundesbank, concurred in by Mr. Schmidt” — 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 added, “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 price.”
The Burns letter is posted at GATA’s Internet site here:
— In June 2004 the deputy chairman of the Bank of Russia, Oleg Mozhaiskov, told a conference of the London Bullion Market Association in Moscow that he suspected that the United States was suppressing the gold price. Mozhaiskov mentioned the Gold Anti-Trust Action Committee, the only words he spoke in English, though at that time GATA had never had any contact with anyone in Russia:
— A president of the Netherlands Central Bank who was also president of the Bank for International Settlements, Jelle Zijlstra, wrote in his memoirs that the gold price was suppressed at the behest of the United States:
— William R. White, the director of the monetary and economic department of the Bank for International Settlements, the central bank of the central banks, told a BIS conference in Basel, Switzerland, in June 2005 that a primary purpose of international 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 thought useful”:
— The Bank for International Settlements actually advertises to potential central bank members that its services include secret interventions in the gold market:
— Indeed, according to its annual report this year, the BIS functions largely as a gold banking and gold market intervention service for its member central banks. On Page 110 of the report the BIS says: “The bank transacts foreign exchange and gold on behalf of its customers, thereby providing access to a large liquidity base in the context of, for example, regular rebalancing of reserve portfolios or major changes in reserve currency allocations. The foreign exchange services of the bank encompass spot transactions in major currencies and Special Drawing Rights (SDR) as well as swaps, outright forwards, options, and dual currency deposits (DCDs). In addition, the bank provides gold services such as buying and selling, sight accounts, fixed-term deposits, earmarked accounts, upgrading and refining, and location exchanges.” The only point of central banks trading in gold derivatives is to affect the price. See:
— Secret gold market interventions by the BIS have been going on for a long time. A long article in Harper’s magazine in 1983, based on a seemingly unprecedented interview with BIS officials, disclosed that the BIS was constantly intervening in the gold market in secret:
— Perhaps most incriminating is the secret March 1999 staff report of the International Monetary Fund that GATA obtained in December 2012. The secret report says Western central banks conceal their gold swaps and loans to facilitate their secret manipulation of the gold and currency markets:
— The participation of the United States in this market manipulation was confirmed by a member of the Board of Governors of the Federal Reserve System, Kevin M. Warsh, in a letter written in September 2009 denying GATA’s request for access to the Fed’s gold records. Warsh wrote that among the records denied to GATA were records of gold swap arrangements between the Fed and foreign banks:
In commentary published in The Wall Street Journal in December 2011 Warsh wrote about what he called “financial repression” by governments. “Policy makers,” Warsh wrote, “are finding it tempting to pursue ‘financial repression’ — suppressing market prices that they don’t like.” Warsh added, “Efforts to manage and manipulate asset prices are not new.”
I later reached Warsh by e-mail and asked him if he had learned about “financial repression” through his service on the Federal Reserve Board and if he would identify those asset prices under manipulation by policy makers. He cordially wished me a nice day.
And the government of China knows all about the gold price suppression scheme. The U.S. State Department diplomatic cables obtained by the Wikileaks organization and published in 2011 included cables from the U.S. embassy in Beijing to the State Department in Washington that were translations of reports from the Chinese government-controlled news media. These translations included stories and commentaries about gold price suppression by the United States.
For example, the Chinese newspaper World News Journal wrote: “The United States and Europe have always suppressed the rising price of gold. They intend to weaken gold’s function as an international reserve currency. They don’t want to see other countries turning to gold reserves instead of the U.S. dollar or euro. Therefore, suppressing the price of gold is very beneficial for the United States in maintaining the U.S. dollar’s role as the international reserve currency. China’s increased gold reserves will thus act as a model and lead other countries toward reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the renminbi.”
So not only does the Chinese government know all about the gold price suppression scheme — the U.S. government knows that China knows:
There are many more records about the official policy of gold price suppression, including minutes of government agency meetings, interviews with government officials, and declassified intelligence agency memoranda. They are posted in the “Documentation” section of GATA’s Internet site:
These documents are not mere speculation and “conspiracy theory.” They are the records of decades-long government policy conducted almost entirely in secret.
Then there is the evidence of the market itself.
GATA also has exposed gold market manipulation by examining trading data, most notably in a study by our late board member and market analyst Adrian Douglas showing that the gold price during trading in the London market went down steadily for 10 years even as the world gold price went up steadily in that time. Anyone buying gold on the opening of the London market and selling it on the close every day over the last decade would have lost a huge amount of money even as the gold price rose steadily:
That is, the London Gold Pool of the 1960s suppressing the price continues to operate today, only with different mechanisms.
In the last year attacks on the gold price have become frequent and obvious, like the strange dumping of paper gold in the futures markets on April 12 and 15, where the nominal equivalent of maybe a quarter of annual gold mine production was sold in two days even though there was no special gold-related news. Many similar dumps are undertaken at particularly illiquid times as someone tries to pound the gold price down for psychological effect.
On October 1, as the U.S. dollar index broke below 80 and the government of the world’s only superpower, the issuer of the world reserve currency, was incapacitated and half shut down by political turmoil, the gold price suddenly fell by 5 percent under an avalanche of futures selling, sometimes at a rate of many thousands of contracts per second. Only an entity with access to infinite money can accomplish something like that.
There was another such brazen bombing of the gold futures market on October 11.
It was a good thing for gold investors that the United States had not just been destroyed in a nuclear war, for then the gold price might have been driven down by 20 percent.
These attacks on the gold market out of the blue are almost certainly incidents of government intervention. Nothing else can plausibly explain them.
Indeed, central banks refuse to explain their involvement in the gold market.
In 2009 GATA sued the Federal Reserve in U.S. District Court for the District of Columbia seeking access to the Fed’s gold records. Technically we won the case in 2011, as the court ordered the Fed to disclose one record, the minutes of the G-10 Gold and Foreign Exchange Committee meeting in April 1997. Those minutes showed Western central bank and treasury officials conspiring to control the gold price. The Fed was ordered to pay GATA court costs, which it did. But the court allowed the Fed to conceal all its other gold records:
Since that time GATA has peppered Western central banks with specific questions about their gold activities, which is something financial journalism, mining companies, or any ordinary investor could do. The central banks largely maintain a guilty silence.
For example, in July the Bank of England reported on its Internet site that it was vaulting about 1,200 tonnes of gold less than it had listed in the bank’s annual report in February. This raised suspicion that the departed gold had been used in the smashing of the gold price in April. So GATA asked the Bank of England to explain the discrepancy.
The Bank of England replied only that the data posted on its Internet site for the public was “deliberately non-specific.” But it hadbeen fairly specific, and had given a number quite different from the number in the annual report. Sensing its vulnerability, the Bank of England concluded its brief statement arrogantly and defensively: “The bank will not be offering any further comment on this matter.”
The specific questions that GATA has raised and that have been deflected by central banks are posted at our Internet site and remain available to any serious financial journalist or gold investor:
As long as central banks refuse to answer some basic questions about their involvement in the gold market, it must be concluded that they have much to hide.
Why does all this matter? How and when will it end?
It matters because the rigging of the gold market is the rigging that facilitates the rigging of all markets — part of a much broader scheme by which a secretive and unelected elite in the United States controls the value of all capital, labor, goods, and services in the world — controls the value of everything and impairs or destroys all markets everywhere and thus hinders humanity’s progress.
This is an utterly totalitarian and parasitic system. It is also just the latest manifestation of the everlasting war of the financial class against the producing class, only it is hidden well enough that the producing class hasn’t yet figured it out.
This system may end in various ways.
First it’s a question of world politics at the highest levels.
The system may end at the insistence of the developing world with an official worldwide revaluation of gold and gold’s formal restoration to the international monetary system.
Or the system may end when one country pulls the plug on it, exchanging U.S. government bonds for more gold than is available.
Or the system may end as part of a plan by central banks to avert the catastrophic debt deflation that now threatens the world.
For example, a 2006 study by the Scottish economist Peter Millar concluded that to avert such a catastrophic debt deflation, central banks would need to raise the gold price by a factor of seven to 20 times in order to reliquefy themselves and devalue their currencies and society’s debts generally:
In May 2012 the U.S. economists and investment fund managers Lee Quaintance and Paul Brodsky published a report speculating that central banks likely are already redistributing gold reserves among themselves in preparation for just such an upward revaluation of gold and gold’s return as formal backing for currencies:
Or the system may end chaotically as the London Gold Pool ended in 1968 when the gold the Western central banks were prepared to lose simply ran out even as those central banks were not yet ready with an alternative gold price control system.
That’s why the system’s end is also an arithmetical question, a question of how much real gold is left among the central banks in the price suppression scheme. Some metal is always draining away to support the gold derivatives system, and it seems lately that more is draining away every year than is being mined. How much do the gold-suppressing central banks really still have left? How much is gone through swaps and leases? They’re not telling.
The system’s end is a question of education and publicity, a question of whether central banks that are not part of the gold price suppression scheme and investors alike will ever realize that as much as 90 percent of the world’s investment gold, supposedly being held in trust for its owners, may not exist. If there is ever such a realization and delivery is demanded, gold will rise to multiples of its current price.
While that prospect excites gold investors, will governments let them keep the resulting extraordinary gains, or will governments impose windfall profits taxes or even try to confiscate gold?
If the gold price soars, will governments let mining companies keep taking metal out of the ground at current royalty rates? Will governments even let private companies keep mining gold at all?
On the other hand, if there is no general realization of the fraud of “paper gold,” gold price suppression and the destruction of markets generally may go on forever.
Central banks are formidable enemies because of their power to create infinite money and debt. But that power is not their biggest advantage in the gold suppression scheme and the scheme to defeat markets generally.
For the scheme cannot work without deception, surreptitiousness, and misunderstanding.
And therefore to be overthrown the scheme needs only to be exposed, since when people realize that a market is rigged, they will not take the losing side of the trade.
That’s why the biggest advantage of central banks here is not their power of money and debt creation but rather the complicity of the financial news media and the gold mining industry itself.
Financial journalists — so far at least — won’t press the vital questions, will never put a critical question to a central bank and report the inadequate answers.
And the gold mining industry, seemingly unaware of the monetary nature of its product and the way the price of its product is suppressed, will not yet do anything to defend itself.
Will that ever change? Well, GATA is working on it.
Until that changes, and as long as a piece of paper is considered as good as a piece of metal, the gold mining industry has no future. And until free markets are restored, humanity itself won’t have much of a future either.
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If you’d like more information about this issue or can’t locate one of the documents I’ve mentioned, please e-mail me at CPowell@GATA.org. I’ll be glad to try to help.
Thanks for your kind attention today.
* * *
Q. Could China be involved in price suppression?
A. He would be “stunned if the Peoples Bank of China was not involved in the April price smash”. China’s challenge is to hedge its US treasury exposure without destroying itself. And while the “Chinese Put” hasn’t held up to well in the past year, [an options trading reference to China buying gold whenever the price dropped thereby setting a floor for its price] China probably doesn’t want the price of gold to fall too far since it has been encouraging its citizens to buy.
Q. Could he speculate as to why the price rose to $1900 an ounce?
A. Maybe China was annoyed with the US for some reason, and said “we’ll show you”, bidding the price up until the US stood down. Just one possible explanation.
Q. Why couldn’t the German Bundesbank get it’s gold back any faster than 7 years?
A. Jim Rickards theory is that Germany doesn’t want its gold back as it’s part of the system. They just made the request to appease the agitators back home so it doesn’t mean the gold isn’t there. That could be a perfectly reasonable explanation. So could the theory that there wasn’t sufficient gold to ship it back to Germany.
Q. Where will USA be in 5/10 years?
A. In New Zealand!
Q. The Bang moment – can you give us a date?
A. “I really can’t”. He was surprised and disappointed that it’s still going on after 14 years. However he believed the gold market will change dramatically not slowly.
Q. If the aim is to manipulate it down, why did they let the gold price go up as high as it is?
A. They have been in a “controlled retreat”.
Speculation but while the gold price has been going up very steadily for the first decade of this century, European Central Banks had been announcing sales of gold almost weekly. So how can this be? None of that gold in the sales was hitting the market -it was already leased or sold. So this started getting out of hand once more people realised this. But this is all speculation – really he asks people to look at the documents and records and then ask questions of central banks and get their financial press interested in this along with mining companies.
Q. Can you talk a bit about gold confiscation?
A. Not much prospect of that today. There was a rational back then (1930’s) as gold coin constituted an enormous part of the money supply and people were hoarding them as they didn’t trust what was going on in the banking system. So they wanted to confiscate it and exchange it for paper to get it back into the money supply and avert the deflation. Also to devalue the dollar.
Whereas that situation does not exist today as gold doesn’t constitute any part of the money stock in the USA. So that rationale from 1933 doesn’t apply today. The Govt would more likely institute a windfall gains tax. So not something he worries too much about although he does keep a good part of his own metal outside of the USA.
Q. Asked about whether GATA has appealed to the World Gold Council or any gold mining companies over the years for assistance?
A. GATA has appealed to many gold mining companies over the years. Only one major one has helped Agnico Eagle. The World Gold Council (WGC) exists only to make sure there isn’t a World Gold Council. It is part of the other side. Somebody ought to form a WGC by a different name. He could not have more contempt for the mining industry as they don’t seem to have any understanding about the monetary nature of the product they are mining or about how it is priced.
Q. Central Banks will likely suppress for any some time to come yet it would seem. So what is the likelihood the market will develop where there will be one price for physical gold and one for unallocated paper gold?
A. Can’t separate too much as people will realise one market is phoney and one is real. Already are starting to realise. Will resolve as it has throughout history. Central Banks will retreat with gold to a higher level and maintain the gold price suppression at a level that doesn’t result in such an off take of their gold reserves. Most likely we will go to bed on Sunday and wake up on a Monday morning and read in the papers that there is new Bretton Woods or Plaza Accord agreement, with new exchange rates and major central banks have agreed to tender for gold at a much higher price to regain all the gold they lost through swaps and leasing. Resuming gold price suppression at a much more practicable level. Whether that profits gold investors will depend upon whether there are windfall profits or capital gains taxes implemented. Who knows how that will play out? But he did think that when the new arrangements are made we will either have our gold or we won’t and it will be too late to get it.
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