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Hands down, the cheapest place in the world to buy gold coin



For anyone looking to hold gold as a store of value or even medium of exchange,  major gold coin mintage’s like the Eagle, Maple Leaf, and Krugerrand are advantageous because they’re recognizable worldwide. You can do business in a coin shop anywhere in the world from Vancouver to Vanuatu with one of these coins; bulk bullion, on the other hand, needs to be specially weighed and assayed by experts before being traded. For this reason, the premiums for which gold coins sell tend to rise substantially in crisis periods when demand for physical metal is high. In the initial days of the 2008 financial crisis, premiums shot up from 4% to well over 10%, even though the price of gold was simultaneously falling sharply. Hang Seng Bank, Bank of China, and Wing Lung Bank. At Hang Seng Bank, Canadian 1 Oz Maple Leaf coins — in pure, 24 karat gold — were available for cash purchase in Hong Kong dollars at just 0.5% above the prevailing spot price of gold. This is dirt-cheap… or as they say in Chile, ‘precio de huevos’, and it certainly presents an interesting arbitrage opportunity. Depending on your objectives, however, there may be even better gold coin buys in Hong Kong at the moment. Over at the Bank of China, for example, the Chinese Panda coins were quoted at 4.9% above spot gold. Personally, I think the Panda is one of the most beautiful gold coins of all, and in North America they typically sell for much greater mark-ups above the spot price of gold than most other coins, often over 20%. In the UK it’s even more.


Many collectors value the Pandas simply for their aesthetic beauty; and it probably doesn’t hurt that the dealers authorized by the People’s Bank of China to sell Pandas in the US have a virtual monopoly on the market. Still, this situation can be exploited to your advantage– the difference between the buy price in Hong Kong and the sell price in North America is roughly $275 per 1-ounce coin.


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Reminder….. If you have/own/  gold and it is not in your hand…..It will not be yours when you try to retrieve…..  READ THIS



New or False Dawn for Gold?

A New or False Dawn for Gold? by David Brady – Sprott Money

Good timing for this article, given that we got the expected thaw in the U.S.-China trade war overnight, with news of trade talks later this month between the two countries. Further proof that the yuan is driving Gold’s bus was exhibited in the immediate dump in USD/CNH from 6.96 to 6.88. Gold bottomed at $1168 and is now up $20, its first decent bounce in some time. Again, driven by the yuan.

The question now is, ‘Is this bounce sustainable or just another so-called dead cat bounce before falling to lower lows?’ More on that shortly.

XAU/CNY (Gold in yuan terms) broke the support line of its pegged range of 8200-8360 yesterday for the first time since January 2017. This does raise several questions, the most obvious being: why? What caused it? Honestly, I am not sure. Does it mean the whole concept of a peg in yuan terms is done? Maybe, maybe not. With a soft peg like this one that has been narrowing since the yuan joined the SDR, you can get temporary breakouts to one side or another. The most important question of all, though, is what does this mean for Gold? Unfortunately, it is not good if it continues.

Gold in dollar terms, or XAU/USD = XAU/CNY divided by USD/CNY.

With Gold in a <2% range against the yuan [8200-8360], this meant that any rise in USD/CNY meant a lower Gold price. This is why the correlation between USD/CNY and XAU/USD has been so tight in recent months, almost tick for tick, and why Gold has fallen so precipitously since April. This is covered in detail in my previous articles. However, if XAU/CNY falls also, that could signal disaster for Gold. If XAU/CNY goes down and USD/CNY goes up, then Gold in dollar terms falls even further. Example:

Reducing the numerator and increasing the denominator in the XAU/USD equation is a double whammy for Gold, as outlined above.

Given the seemingly relentless drop in Gold, I have been asked repeatedly how low it could go. Based on the premise of XAU/CNY being pegged within a range of 8200-8360 and an additional 10% devaluation of the yuan in dollar terms to offset 25% tariffs from the U.S., I came up with the following at the time:

This put the bottom at ~$1100, just above the December 2015 low of 1045, which would make sense for a Wave 2 bottom in Elliott Wave terms for a truly massive rally to follow. But given that XAU/CNY has broken down below support at 8200 now, all bets are off and Gold could go even lower.

I don’t know if XAU/CNY is going to continue to fall, rise back into its range or go higher, but if it falls while USD/CNY rises, that would be a huge problem for Gold. We have to see how this develops in the coming days and weeks.

Back to USD/CNY. I stated the following at the end of my previous article:


I have also shared on my website and Twitter that many people, including myself, have been predicting some kind of thaw in the trade war that would boost stocks and other risk assets, and we got that last night.

Now we are seeing USD/CNY fall, Gold bounce as expected. But here’s the key point: Unless there is a definitive agreement later this month to resolve the trade war between the U.S. and China, this drop in USD/CNY and rise in Gold is nothing more than a temporary reprieve. If we do get such an agreement, the Gold party has truly begun, and a massive rally has likely already started.

However, if this turns out to be another false dawn, and the U.S. implements 25% tariffs on $200bln or 40% of Chinese exports on September 5 th or shortly thereafter, coupled with a threat of 25% on the remaining $300bln—which Trump suggested a little over a month ago—then look out below in yuan and Gold terms. The disappointment that follows the current optimism would likely send USD/CNY through 7 with ease and Gold down to new lower lows.

The fact that this trade meeting involves lower level officials from both countries, and with comments like that below coming out of China beforehand, I’m not as hopeful as everyone else right now.

This could go either way, but this is the key issue affecting Gold. Not technicals, sentiment, positioning, the dollar index, USD/JPY, real interest rates… this trade war and its effect on USD/CNY is all that matters for Gold right now. Nothing has been resolved yet, and it may get a whole lot worse.

I’ll end on some positive notes. The U.S. stock market is facing a perfect storm of headwinds that could cause a crash later this year or slip into 2019. If and when that occurs, given the importance of the stock market to Federal Tax Receipts in particular, I expect the Federal Reserve to reverse policy back to ‘QE’ and zero or negative interest rates. This would likely mean a major peak in the dollar and a historic bottom in Gold.

Secondly, I understand that many people are long Gold (and Silver) and have suffered significant and painful losses. They are beginning to wonder if precious metals will ever reach fair value. In response, I say this as always, “Follow the Smart Money Long-Term.” China and Russia continue to accumulate Gold and Silver and have been doing so for over a decade. Central Banks all over the world are either buying or repatriating their Gold also. They are not doing this because it is shiny or because they collect barbarous relics. I believe they are preparing for and hedging against a crash in the dollar. But they are not traders and do not care about mark-to-market values in the short term, so this may not happen for a while yet, although they have also been preparing for quite some time already.

And then there is JP Morgan, sitting on a massive mountain of physical Silver it has accumulated since 2011 and which it continues to add to. Bankers don’t get out of bed in the morning unless they plan to make a profit, and neither does one of the biggest banks in the world. When Gold soars, Silver will explode higher in my opinion, and JP Morgan knows this too.

This Why Germany Repatriated 583 Tons Of Gold?
Profile picture for user Tyler Durden
by Tyler Durden
Fri, 06/22/2018


Before declaring bankruptcy, Lehman Bros. had $639 billion in assets. It was thought to be too big to fail. Currently, Deutsche Bank has almost triple those assets, $1.7 trillion, but its future is in question. The bank’s net income plummeted by 80 percent from its 2017 level. The Federal Reserve has labeled Deutsche Bank’s US operation as troubled. And that might be an understatement.

The growing problems at Deutsche Bank, combined with unprecedented global debts, could spell economic and financial chaos. Deutsche Bank is only one of the major banks in trouble. Others are nipping at its heels.





The Trend Away From the Dollar to Gold Continues, Turkey Significantly Increases Reserves


Global Gold Supply Declining?

  • Global demand for gold is increasing while new discoveries of gold remain small
  • Gold mining output in Australia is forecast to decrease by 50% in the next eight years
  • Decline in global gold mining supply makes a price increase almost certain

Gold nugget (placer gold) from Colorado, USA.  Source:

by Lawrence Thomas, Gold Telegraph

The demand for gold is increasing, yet new discoveries of the precious metal have not kept pace with the demand. Funds for exploration are historically high, $54.3 billion, up 60 percent over the past 18 years.

The increased spending, however, has not produced the equivalent in new gold discoveries. During the past decade, 41 discoveries have resulted in a mere 215.5 million ounces of the precious metal. Even counting recently discovered but unexplored mines, which may hold as-yet major discoveries, the total available amount of gold in these discoveries are not expected to surpass 363 million ounces over the next ten years.

Gold discoveries have followed a predictable pattern. 263 major gold discoveries have been made in the past 28 years, but half of those discoveries happened in the 1990s. This boom lasted until the turn of the century when the rate of discovery began to decline. Only 16 discoveries were reported from 2000 to 2002, which produced 108.3 ounces of gold. That amount was below the average finds of the 1990s. This decline has continued, with both new discoveries and the amount of gold mined decreasing steadily. By 2010, only 18.6 million ounces of gold was discovered, a severe drop from the 61.5 ounces found in 2009.

Old sectors are being depleted, while active exploration for new discoveries has been slow. The amount of available gold has not met expectation and remains far below the 2009 high.

The lack of new discoveries is not the result of funding. $54.3 billion has been allocated to exploration during the past decade. Part of the problem is that the time span between discovery and production is around 20 years. Unless significant new discoveries are made, the amount of available gold could decrease in the near future, raising the demand for the metal even further. Scarcity invariably results in higher prices, and the decline in global gold makes a price increase almost certain.

Continued gold exploration has become critical. In 2018, Colorado-based Newmont Mining Corp., one of the world largest gold explorers, has allocated $1.3 billion to expand its current projects, an increase of $300 million from the previous year.

Much of the available gold in Australia’s northern Goldfield has been depleted, and companies are drilling to unprecedented depths of 3 kilometers below the surface hoping for new discoveries as new finds are becoming rarer and more expensive to pursue.

According to Richard Schodde, managing director of MinEx, Australia gold mining output could decrease by 50 percent over the next eight years, with only four mines remaining open by 2057.

The need to drill deeper will make gold harder to find and more expensive to produce.




Gold continues to build towards a breakout from a major base pattern, a giant Head-and-Shoulders bottom that we can see to advantage on its latest 10-year chart below. At present it is battling the headwinds of a dollar rally, but a dollar rally won’t stop it, because when we talk about a dollar rally, we mean against other fiat, and all fiat is in the latest stages of a journey to oblivion, which actually started way back in 1913 with the Federal Reserve, and started to enter the terminal blowoff phase as long ago as 1971 with Nixon’s elimination of the gold standard.

On the 10-year chart it looks like “all systems go” for gold, with the price advancing steadily towards the neckline resistance at the upper boundary of the pattern on greatly increased volume, which has driven volume indicators to new highs, a very bullish sign. Take a good look at the volume on this chart – it has been expanding steadily since the price rose out of the final bearmarket low late in 2015. Most of this volume has been upside volume, which is why the volume indicators have been advancing strongly and recently advanced to new highs. This has been going on for WELL OVER 2 YEARS. So do you think that this bullish action for all this time is going to be derailed by a dollar rally lasting 2 weeks, or even 2 months? No, thought you didn’t – me neither.Now we will examine the latter part of this giant Head-and-Shoulders bottom on a 3-year chart. Here we see in more detail the trend of higher lows since the late 2015 bottom, itself clearly very bullish, as is moving average alignment, with the 200-day rising steeply, but not too steeply. Again we see the impressive big buildup in upside volume, that drove volume indicators to clear new highs at the start of the year, and On-balance Volume has been flirting with new highs recently. This chart is also useful because on it we can see where any somewhat deeper reaction due to a continuation of dollar strength is likely to terminate, at one of the two supporting trendlines from the lows that are shown, and it is considered much more likely that any such reaction will stop at the higher trendline. Furthermore, as we will see later when we look at the dollar charts, it could turn up here and break out almost immediately if the dollar should now roll over and drop.

Whilst the 6-month chart is of limited use technically, it does show that gold is actually at a good point to turn up here, as it is close to a zone of support which is underpinned by the rising 200-day moving average in quite close proximity. This looks like a pretty good point to undertake more accumulation of battered down gold stocks.

A concern that we have had since late January is that gold’s COT structure seemed prohibitive of a significant rally, simply because the Commercial short and Large Spec long positions were too high, in marked contrast to silver’s which have been decidedly bullish, and that has proved to be the case as gold has not advanced since late January. There is good news here though, for as we can see on the latest COT chart below, even though positions are still in middling ground, they are in an improving trend, and they could improve further if we see more dollar strength over the short to medium-term, although it is believed that they have now eased sufficiently to permit gold to break out.

Click on chart to popup a larger, clearer version.
Now we will look at the dollar whose impressive rally over the past couple of weeks has caused gold to drop back. Although this rally has broken it out of what looks like an intermediate base pattern, it nevertheless rates as a countertrend rally at this point because it has brought it up to resistance close to a quite steeply falling 200-day moving average, and moving averages remain in bearish alignment, as we can see on the latest 6-month chart below. Thus it is interesting to observe that a bearish “gravestone doji” formed on Friday, where it advanced intraday but was beaten back by selling so that by the close it ended up back where it started at the open – this is a bearish development for the near-term.

The 2-year dollar index chart does not look at all encouraging for dollar bulls. While bulls may derive some comfort from the fact that the dollar has broken out above the downtrend line from the late 2016 peak, it has not broken out of the adjusted parallel downtrend channel shown, and is instead at its upper boundary, at resistance and at its falling 200-day moving average, a combination of circumstances that should at least lead to its pausing here, if not reacting back, especially as it has become overbought on its short-term oscillators. Going just on this chart, the dollar could be done here and turn tail and go into decline again, which would be good news indeed for both gold and silver.

It is worth zooming out and looking at the dollar index also on its 5-year chart, because on this chart we see that it may be at the lower boundary of a giant Broadening Formation. Whilst these patterns are bearish in nature, what quite often happens with them at this stage is a period of wild and erratic trading ensues that is followed by a breakdown from the pattern and a collapse. Thus we could see a more significant advance by the dollar over the medium-term before it turns lower again.

The latest dollar Hedgers chart supports the idea of a larger dollar rally developing here, for as we can see Hedgers positions are at levels that in the past have led to significant dollar rallies.

Click on chart to popup a larger, clearer version.Chart courtesy of





“There can be little doubt that the introduction of the yuan-denominated oil future has been a major strategic step for China.”


Regular readers will be aware that we were among the first to alert western financial markets that China would introduce a new oil futures contract priced in yuan, months before it was officially admitted that the plans for the contract were being finalised and a date for trading was being planned.

Trading in the new Shanghai oil future commenced last Monday, and on the first three days trading there were 151,804 contracts traded with a turnover value of 65bn yuan. It is the first futures contract listed on China’s mainland available to overseas users, putting them on the same footing as domestic investors. There are 15 benchmark contracts for different delivery dates between September next and March 2019.

There is little doubt that the Chinese government views this contract as an important development, with international commodity trading houses, such as Glencore and Trafigura, encouraged to participate. Furthermore, state-owned banks would have been on hand to ensure the necessary currency and financial liquidity is available.

The Chinese are likely to ensure trading liquidity continues to build in its new oil contracts before its oil suppliers routinely use them against physical oil deliveries. Presumably, this is one reason the first delivery date is in September, while actual shipment is never more than a month or so.

This contract goes head-to-head against the petrodollar and is the first serious challenge to it since its inception in the mid-1970s. The petrodollar was born out of the monetary chaos that led to the end of the Bretton Woods Agreement, when excess dollars in foreign hands were redeemed for gold. In that sense, being the first significant threat to the petrodollar, this contract could mark the end of a monetary era.

China does not intend to replace the petrodollar with its own currency, other than for her own energy and commodity imports. To put it into context, China imports about 8 million barrels of oil per day, mostly from the Eurasian continent, which compares with global daily demand of roughly 100 million barrels. China also produces her own oil to the tune of about 3.7 mbd, so if all China’s suppliers take yuan in payment, it leaves about 88% of global demand still being priced in dollars.

Therefore, there is for the moment little alarm in Western financial markets about this development. However, at the same time, US oil production is rising, and her imports declining, so even though the energy world is dominated by dollars, the relative importance between the US and China with respect to the international oil trade is rapidly shifting away from America….Read the rest here if you are a gold bug





Russia And China Rolling Out 100% Gold-Backed Currency

Russia and China roll our gold-backed currency

Russia and China have outlined plans to create a 100 percent gold-backed currency system to replace the US dollar as the world’s dominant currency.

The Central Bank of Russia has been steadily amassing vast gold reserves since 2015 – accumulating 1,828.56 tons by the end of 2017 – making it the fifth largest gold reserve in the world. reports: Russia has been aggressively increasing its gold reserves for a reason. It has seen the US dollar dominate as a global currency and is working with China to end the US/Western currency supremacy.

Their strategy appears to be working. Russia and China are in the midst of rumors of introducing gold-backed futures to circumvent the U.S dollar.





Profile picture for user BullionStar

Authored by Ronan Manly of, via

Central bank gold price suppression is a well-documented fact. Central banks have a long and colorful history of manipulating the gold price. This manipulation has taken many shapes and forms over the years. It shouldn’t be surprising that central banks intervene in the gold market given that they also intervene in all other financial markets. It would be naive to think that the gold market should be any different.

In fact, gold is a special case. Gold to central bankers is like the sun to vampires. They are terrified of it, yet in some ways they are in awe of it. Terrified since gold is an inflation barometer and an indicator of the relative strength of fiat currencies. The gold price influences interest rates and bond prices. But central bankers are also in awe of gold since they respect and understand gold’s value and power within the international monetary system and the importance of gold as a reserve asset.

So central banks are keenly aware of gold, they hold large quantities of it in their vaults as a store of value and as financial insurance, but they are also permanently on guard against allowing a fully free market for gold in which they would not have at least some form of influence over price direction and market sentiment.

The Central Bankers’ Central Bank

The Bank for International Settlements (BIS) crops up frequently in gold price manipulation as the central coordination venue and the guiding hand behind a lot of the gold price suppression plans. This is true in all decades from the 1960s right the way through to the 2000s. If you want to know about central bank gold price manipulation, the BIS is a good place to start. Unfortunately the BIS is a law onto itself and does not answer to anyone, except its central banks members.

In the 1960s, central bank manipulation of the gold price was conducted in the public domain, predominantly through the London Gold Pool. This was in the era of a fixed official gold price of $35 an ounce. Here the US Treasury and a consortium of central banks from Western Europe explicitly kept the gold price near $35 an ounce, coordinating their operation from the Bank for International Settlements (BIS) in Basel, Switzerland, while using the Bank of England in London as a transaction agent. This price manipulation broke down in March 1968 when the US Treasury ran out of good delivery gold, which triggered the move to a “free market” gold price.

Central banks continued to suppress gold prices in the 1970s both through efforts to demonetize gold and also dump physical gold into the market to dampen price action. These sales were unilateral e.g. US Treasury gold sales in 1975 and over 1978-1979, and also coordinated (and orchestrated by the US) e.g. IMF gold sales across 1976-1980.

Gold Pool 2.0 – Force it Down Quick and Hard

Gold Bugs-Don’t take your eyes on this critical price zone!

Certain price zones for all assets come into play where bulls would not want to see selling get started. Below highlights one of those points for Gold Bulls.

The left chart looks at Gold over the past 20-years and the right chart zooms in to look at just the past 4-years.










Own physical Gold and Coins outside the Western banking system




Singapore is one of the most stable countries in the world today – both politically and economically, and is emerging as the preeminent precious metals trading hub in Asia. 

Today there is a growing move to own gold outside of massively indebted and near insolvent western banks and sovereigns. This trend looks set to continue given the very poor state of most western nations and Singapore looks set to be a beneficiary of this trend.

# HEADS UP……..State Deals Blow to Federal Reserve, House Passes Bill To Treat Silver and Gold as Money- Plz ReTweet 

BREAKING………Rumor rampant that Trump made deal for enough Gold for U.S. Treasury to issue NEW domestic currency WITH GOLD AS COLLATERAL….



A prolonged period of cheap money and the shift of investor focus to gold as a haven from geopolitical and financial risk could boost the price of the precious metal to over $5,000 an ounce in five years, McEwen Mining CEO Rob McEwen says.If that happens, “there is going to be a tsunami of money looking for a place to go,” he told Bloomberg at a mining industry conference in San Francisco.One of the industry’s biggest bulls, McEwen is known for his passion for gold. He was one of the top hundred wealthiest Canadians as of 2016, with an estimated personal net worth of over $800 million.


German Investors Now World’s Largest Gold Buyers

GoldCore's picture

German Investors Now World’s Largest Gold Buyers

– German gold demand surges from 17 ton-a-year to a 100 ton-plus per year
– €6.8 Bln spent on German gold investment products in 2016, more per person than India and China
– Germans turned to gold during financial crises and ongoing euro debasement

– Evidence of latent retail demand on increased economic concerns
– “Gold fulfils an important long-term, wealth preservation role in German investors’ portfolios”

Editor: Mark O’Byrne

per capita gold demand

India and China often grab the headlines as the world’s largest buyers of gold. In 2016 this was not the case.

When measured on a per capita basis it is Germany that takes the impressive crown of largest gold buyer in 2016, all thanks to their investment market. Last year the country set a new personal best, ploughing as much as £6.8bn ($8 bn) into gold coins, bars and exchange-traded commodities (ETCs).

This is impressive considering that back in 2008 the amount of gold purchased by Germans barely registered outside of the country. A new World Gold Council report records that ‘average demand between 1995 and 2007 was a modest 17 tonnes’. In some of those years they weren’t even net-buyers.

In 2008 this began to change as ‘the global financial crisis brought gold to the attention of German investors at large.’ By 2009, the German gold investment market became one of the world’s largest, with annual coin and bar demand growing four-fold from 36t in 2007 to 134t in 2009.

Since then it has continued to climb, as explained in the latest World Gold Council report:

Germany has established itself as a 100t-plus per year market for bars and coins, and a vibrant domestic ETC market has developed: during Q3 2017, German-listed ETC AUM hit an all-time high of 252.1t, equivalent to €9.8bn.

So what changed and can the country keep up this record-breaking?

What changed?

German decade long gold demand

It is assumed that the Germans have an innate understanding of the value of gold thanks to their tumultuous economic history.

As the WGC summarises:

German investors have an acute awareness of the wealth- eroding effects of financial instability. Hyper-inflation in the 1920s lingers on in the collective memory but, perhaps more importantly, German investors have seen fiat currencies come and go: in the past 100 years, Germany has had eight different currencies.

The past seemed to be catching up with the future following the financial crisis when savers once again began to see their savings disappear. Following the ECB’s decision to slash interest rates German banks began charging customers to hold their cash, and yields on German bunds dropped into negative territory.

It isn’t surprising that that this triggered Germany’s gold shopping spree. This was supported by the country’s growing gold bullion network that has made it easier for customers to buy and store gold bullion and coins.

Their concerns about the banking system drove up demand for the physical, allocated gold products of the 100-150 non-bank bullion dealers across the country. Investor behaviour shows that gold buyers are clearly seeking out physical gold that they can take delivery of should they so wish.

Where does it go from here?

‘…it is clear why the market boomed. Financial and economic crises brought gold to the attention of investors, and the resulting interest triggered a wave of product innovation and market development.’ 

Given the upshot in German demand following the financial crisis of 2008, it is understandable to look out for further economic downturns as an indication of future gold demand in Germany.

Bank of America Merrill Lynch Fund Manager Surveys, for example, highlight that European investors see FED/ECB policy mistakes as the most likely tail-risk event in the coming months, and around 30% of those surveyed believe Fed balance sheet reduction will be a risk-off event, causing a fall in both global bond and stock prices.

So does this mean demand for gold in Europe’s wealthiest country is set to increase? Perhaps, but it isn’t reliant on more financial upset.  The WGC notes that ‘it is important to highlight that Germany’s gold market is not dependent on financial and economic crises.’

In the last decade the economy has performed relatively well in contrast to its fellow EU members. Unemployment is very low and wage growth at 4.4% this year is impressive when compared to the likes of the UK. Germans also remain positive about their own personal financial situations.

This suggests that Germans are not buying gold simply because they believe a financial crisis will happen but because they see it as an important portfolio diversifier which acts as a store of value.

In 2016, the WGC commissioned Kantar TNS to survey more than 2,000 German investors. Results showed:

– 59% of respondents agreed with the statement that gold will never lose its value in the long-term
– 48% agreed with the statement that owning gold makes me feel secure for the long-term
– 42% agreed with the statement I trust gold more than the currencies of countries
– 57% of bar and coin investors did so ‘to protect their wealth’
– 28% invest in bas and coins to make good returns in the long-term

When asked why they invest in gold, the answers were extremely insightful:

Today, gold is increasingly viewed by German investors as a regular form of saving: 25% of those surveyed in 2016 said their gold purchase had been part of a regular review of their investments, while 23% said it was part of their retirement planning.

We should all learn some German

If we are to believe Western media then this year’s decision by various central banks to start unwinding easy monetary policy is a signal that the gold price is set to fall. However Germans gold demand suggests otherwise.

It is clear that German investors are not swayed by the ‘newspeak’ the rest of the West seems so taken by. Whilst it is undoubtedly the 2008 financial crisis that set off the boom in gold demand, it is the value placed on gold as a diversifying asset that has sustained the market.

The ratio of investors buying gold bars and coins compared to those selling is around 10:1. This is despite the economy looking healthy and unemployment at its lowest since the 1990 reunification.

Clearly, German confidence in the economy is not expressed through their gold investments any longer. Instead it is their confidence in gold that keeps the market strong.

Investors and savers would be wise to pay attention to such investment logic. In countries such as the UK unemployment and wage growth are nowhere near as desirable as we see in Germany. Additionally, there are increased further uncertainties.

When the Germans sensed uncertainty following the financial crisis they did not panic about the global situation. They instead took a long hard look at their own banking system and began to diversify their savings. As a result they rediscovered their trust in gold which continues to grow year by year.

“This Could Be Huge”: Gold Bar Certified By Royal

Canadian Mint Exposed As Fake

“This could be huge. There could be quite a few people out there who’ve been rolled over,” said an Ottawa goldsmith after discovering a gold wafer with proper Royal Canadian Mint stampings which appears to be a fake.

<! ss=”title”>Who Knew? German Central Bank Has Been Selling Gold For More Than A Decade

Tyler Durden's picture

Authored by Louis Cammarosano via,

Deutsche Bundesbank gold reserves shrink 45 tons over the past ten years.

  • German Central Bank holdings fall From 3,420.6 tons at the end of Q2 2007 to 3375.6 tons, a drop of 1,446,783 ounces.
  • German gold reserves have decreased 1.3% over ten years.

Bring the Gold Home & Sell Some

Deutsche Bundesbank, the central bank of Germany, has gained a high profile for its insistence on repatriating a good portion of its gold from vaults at the New York Fed, the Bank of England of London and the Bank of France in Paris. We have been covering the German gold repatriation story since they made their request in 2013 hereherehere and here.

The German repatriation requests aimed to rebalance the Deutsche Bundesbank’s gold holdings from nearly 70% held abroad to 50% held within Germany’s borders. The German Central Bank announced earlier this year that it has nearly completed its plan to repatriate its gold.

Jens Weidman, President of the Deutsche Bundesbank once famously said

“Indeed, the fact that central banks can create money out of thin air, so to speak, is something that many observers are likely to find surprising and strange, perhaps mystical and dreamlike, too – or even nightmarish.”

In this video from the Deutsche Bundesbank, German nationals, Deutsche Bundesbank representatives and Herr Weidman explain the importance of gold to Germany.

Given the Deutsche Bundesbank’s statements and the accelerated German gold repatriation schedule, we are surprised to see that the Deutsche Bundesbank has been a steady seller of its gold over the past ten years.

German Gold Reserves 2007 – 2017

The Duetsche Bundesbank gold reserves fell 45 tons from June 30 2007 to May 31, 2017.

The Central Bank of Germany holds the second largest gold reserves of any central bank.

Currently, with the People’s Bank of China halting its gold purchases since October 2016, only the Central Banks of RussiaKazakhstan and recently Turkey are steady buyers of gold.

Update July 9, 2017 – In the companion video to this blog post, I noted that I would contact the Deutsche Bundesbank to determine why they have been steadily selling gold. I received a twitter notice from @BullionBaron with an excerpt from the 2016 DB annual report indicating that DB sold 3,045 kg or 0.1 million oz of gold to the Federal Government at market prices for the purpose of minting gold coins. I reviewed DB annual reports for the period covered by this blog post (2007-2016) and there is a note in each one indicating the sale of gold each year between 100,000 -200,000 ounces for the purpose of minting gold coins.

DB noted in its 2012 annual report: “As part of its management of gold reserves, the Bundesbank has, since 2002, been selling small amounts each year to the Federal Office for Central Services and Unsettled Property Issues to mint gold coins. In 2012, it sold around 4.9 tonnes of gold in total for the minting of the €100 gold coin “UNESCO World Heritage–  Aachen Cathedral” and the €20 gold coin “German forest – spruce”. The sales took place under the extended gold agreement between the central banks of the Eurosystem, Switzerland and Sweden in August 2009.” A similar note appeared in the 2011 DB annual report, indicating a sale of around 4.7 tonnes for the purpose of minting the €100 gold coin “UNESCO World Heritage–  Aachen Cathedral” and the €20 gold coin “German forest – spruce”.

Traitors Abetting The Deep State’s Dirty, Dying War on Gold – Stewart Dougherty

By Stewart Dougherty 4 days ago 3287 Views 1 comment

May 8, 2017

Evidence is mounting that the Deep State (DS) is starting to lose the dirtiest financial war in history: their War on Gold. More deeply, it is a war against something the Deep State profoundly loathes: personal financial liberty. The War on Gold, which has raged for 37+ years, has generated more than $1 trillion in criminal profits for the Deep State plunderers, while costing the worldwide owners of physical gold multiple trillions of dollars. All of this is coming to an end.

Due to its criminal hyper-manipulation, gold’s price has become a paradox: its weakness actually reflects its strength. With everything that has been thrown at it, it is astounding that its price is anything north of zero. The fact that it has been resilient at around $1,200.00 per ounce should concern the manipulators, because if this is as low as they can take it despite their full-spectrum, multi-billion dollar assault against it, then it is defeating them. Which is not surprising. By every conceivable, objective financial and monetary measure, gold is one of the most underpriced assets on earth. It is not going to stay that way. (Most of the dynamics we will discuss also apply to silver, but to streamline this article, we will focus on gold.)

The Deep State’s first strategic objective in the War on Gold has been to steal as much money as possible by conspiratorially rigging its price. They have perpetrated this crime in the full knowledge that it will never be investigated or prosecuted, because it is state sponsored. The Deep State is the state, and never prosecutes itself for its own crimes, no matter how flagrant and egregious they are.

The second, broader strategic objective has been to discredit gold as a monetary asset and safe financial haven throughout the west. The Deep State realized at the outset of the war that it would be impossible to achieve this in the east, which has a deep, cultural affinity for gold, so they have confined this gambit the west.

There are eight primary tactics in the War on Gold. Seven of them are generally known by those who study the gold market; one of them is little known or appreciated. The unknown tactic is actually the most important and effective tactic of all, while also being the Deep State’s Achilles’ heel.

The tactics in the War on Gold are:

1) Randomly and unpredictably attack the gold price in the futures markets, producing large price whipsaws, investor losses, and a generalized spirit of price uncertainty, danger and concern; over time, make existing and prospective investors view the market as a corrupt casino rigged against them, causing them to capitulate and leave the field;

2) Employ the most advanced, covert “Black Psychological Operations” (PsyOps) methods, customized for the financial sector by the CIA’s Division of Psychological Warfare, the Fed, the Treasury, the ECB and the BIS, to destroy gold sentiment in the west. As part of this campaign, use the Mainstream Financial Media (MFM) to conduct a continual propaganda campaign denigrating gold in every respect, destroying interest in it;

3) Fraudulently overstate official holdings to create the illusion of massive supply overhang;

4) Sterilize investment funds by steering them into non-auditable paper proxies (e.g., ETFs);

5) Weaken, then destroy the dealer network by killing product demand, spiking dealer costs (e.g., required hedging against relentless price volatility), causing large unhedged losses, demonizing dealers as money launderers and crooks, and wiping out profitability / business viability;

6) Financially weaken miners via crushed prices, making them dependent upon bullion bank (DS) financing and debt, and forcing them to comply with bullion bank orders;

7) Paint phony price charts that enable the “financial services industry” (stock brokers, investment advisers, bankers, etc.) to make gold investing appear stupid, and talk people out of buying gold, particularly in physical form; if this fails, sterilize investment funds by steering them into phony, paper gold;

8) Create a marketing blackout throughout the west (which is the Achilles’ heel).

Tactics #1 and 8 are the subject of this article, because they are inextricably linked. It would be impossible for the Deep State to employ Tactic #1 if it were not for their simultaneous use of Tactic #8.

As we know, Tactic #1 has been carried out by years’ worth of massive, unpredictably-timed, electronic, naked-short price attacks primarily conducted on the Comex, the Deep State’s captured and non-regulated Command and Control Center. GATA has long documented in exquisite and laudable detail the gold price-rigging scandal, and Deutsche Bank’s admission in late 2016 that they and numerous other major banks manipulated the gold market for years ended, once and for all, any possible doubt about gold market corruption.

As is typical in Deep State-sponsored financial crimes, none of the Deep State criminals ever goes to jail; instead, they simply pay fines to the Deep State itself. Deep State criminality is a closed system of plunder from which the profits never leave; they merely circulate from one Deep State pocket to another.

Tactic #8, the complete lack of industry-sponsored gold marketing throughout the west, is a crucial component of the War on Gold. Without Tactic #8, the Deep State would be incapable of employing Tactic #1, because the criminalized, fractional reserve gold exchanges, primarily the Comex, would no longer exist. They would no longer exist because they would be unable to source even the minimal amount of physical gold required to create the false illusion of legitimacy, which would fully expose them as being nothing but the paper metal frauds they already are for all intents and purposes.

According to the Mainstream Financial Media, gold is a “commodity.” This deliberate mischaracterization of gold is intended to deflect attention away from its unparalleled monetary importance, and make it appear no different in nature from corn, natural gas or pork bellies. Rarely has a greater monetary lie ever been perpetuated.

Gold is not a commodity; it is the world’s only natural and universal money, and therefore its pre-eminent consumer product. From the time of its discovery over 6,000 years ago, human beings have instinctively realized that gold is incomparable as pure, honest, incorruptible, reliable, functional, lasting, valuable, and true money and wealth. This is precisely why the Deep State swindlers despise it. It is the antithesis of the immoral, baseless, corrupt, predatory, fraudulent fiat currencies they endlessly and parasitically counterfeit into oblivion at extraordinary profit to themselves and crushing expense to their victims, the people.

Providers of consumer products and services know that their offerings must be marketed. Not even the best of them sell themselves; they must be sold.

In 2016 alone, corporate managements worldwide spent over $1 trillion to advertise and promote their goods and services. They paid this astronomical sum because they know that marketing is indispensable to commercial success. Marketing is not an expense; it is an investment in profit.

We all recognize the phrases marketers have created to bring their products to life: “Just Do It,” “Don’t Leave Home without It,” “The Ultimate Driving Machine,” “Everywhere You Want to Be;” “Good to the Last Drop,” “Where’s the Beef?,” “Be All You Can Be,” “I Love New York,” “We Bring Good Things to Life,” “Think Different,” “Like a Good Neighbor, …;” “When it Absolutely, Positively Has to be There Overnight,” “We Try Harder,” “Diamonds are Forever,” among so many memorable others.

There is only one consumer product industry we can identify that does absolutely nothing to develop its market: gold mining. For decades, the miners have refused to lift a finger to promote gold. (Their appointment long ago of the World Gold Council as a marketing agent has been a complete disaster, and its dreary saga could be an article all its own.) This refusal constitutes a colossal rejection by them of the most important business function of all and a total abdication of their fiduciary obligation to shareholders. As a result of the miners’ persistent and indefensible refusal to market gold, western consumer demand for it is a fraction of what it could and should be.

We cannot find one senior gold mining corporation that includes in its top executive ranks a Chief Marketing Officer, or any role even resembling it. While we do find senior executives in: “Exploration,” “Operations,” “Investor Relations,” “Technology,” “Corporate Development,” “Regulatory Affairs,” Legal (“General Counsel,” “Compliance”), Finance (“Chief Financial Officer”), “Mergers and Acquisitions,” “Tax,” “Sustainability,” “Human Resources,” and “Strategy,” the marketing function is completely absent throughout senior miner top management. This is unprecedented in consumer commerce.

The miners’ refusal to market their product is so idiotic that it must be deliberate. It is impossible that such self-destructive commercial stupidity could come naturally to even one senior mining executive, let alone the entire set of executives in the senior gold mining industry, particularly given its extremely negative consequences.

This begs the questions: What is going on here? Why do the gold miners deliberately refuse to market gold, even though it is obvious that market demand and price for it have severely suffered as a result? Why do they deliberately destroy enterprise and shareholder value by ignoring the most important function in consumer commerce: marketing? Why do they willfully and knowingly repudiate their fiduciary obligations to shareholders, creating in the process potentially serious legal liabilities for themselves and their corporations? And why do all senior miners walk in such lunatic lock step when it comes to their refusal to market?

Executives at the senior mining companies have a long history of enriching themselves with lavish pay, benefits, pensions and stock options while at the same time stabbing their shareholders in the back. For example, their “forward hedging strategy,” conducted at the behest of and in full collaboration with the bullion banks during the brutal, 22 year gold bear market (1980 – 2001) savaged the prices of gold and mining shares. All the while, rich, no-lose compensation packages for mining executives were written around pre-arranged and hedged gold prices. The shareholders got screwed as the executives got rich. As we can see today, nothing has changed.

The miners’ excuse for their multi-decade failure to develop the gold market is that it is “just a commodity,” and no one markets those. Even if we agreed that gold is a commodity, which we adamantly do not for the reasons explained above, the excuse is not credible. In 1993, on a meager annual budget of only $23 million, one of the most successful advertising campaigns of all times was launched for a so-called commodity: “Got Milk?”

If creative advertising could make milk exciting, which it did, imagine what it could do to increase interest in and demand for gold. So what’s the problem here? Why is no one in the gold mining industry willing to give marketing a try? What, possibly, have they got to lose, other than the dismal gold price and multi-billions of corporate losses their marketing incompetence has produced over the past 37 years? More specifically, what is it about marketing gold’s incomparable monetary virtues that paralyzes them? It is obvious that the senior mining executives are not working for shareholders. So for whom are they working?

The only logical answer we can provide is that the senior miners are direct allies in the Deep State’s War on Gold. By employing Tactic #8, the traitorous miners have damaged gold demand as much as the criminals who use Tactic #1 have damaged its price.

The financial cost of the senior miners’ complicity in the War on Gold is astronomical. From 1980 through 2016, excluding China and Russia, approximately 79,000 metric tonnes, or 2.5 billion ounces of gold were mined. During the 1980 – 2001 bear market, gold was virtually given away by the miners for nothing, reaching dirt-cheap, double-bottomed prices of only $250 per ounce in 1999 and 2001. In the bear market that started in 2011 and continues to this day, gold has plunged from an inflation adjusted 2011 high of $2,081 to today’s price around $1,200, which is close to its average, all-in production cost. In other words, 37+ years into the War on Gold, miners continue to give away their shareholders’ gold for a pittance, when they could easily increase its price simply by doing what every other consumer company does: market it.

If we assume that the Deep State’s War on Gold has only shaved $100 per ounce off its price, the undervaluation of the gold mined from 1980 – 2016 is $250,000,000,000.00 ($250 billion). While this is an astounding sum, we believe the actual cost is much higher. According to our analysis, the underpricing of gold ranges between $1,000 and $3,000 per ounce, depending on the comparative metric we use (e.g., global money supply; global debt; global private savings; global GDP; global equities; inflation; and the like). By other metrics, it is even more, but we will be conservative.

Therefore, the total undervaluation of the gold mined during the War on Gold ranges between $2,500,000,000,000.00 and $7,500,000,000,000.00 ($2.5 to $7.5 TRILLION). This is tantamount to theft from the owners of the mined gold, namely, shareholders.

On a global basis, physical gold owned by individuals, businesses, religious organizations and sovereign institutions is currently undervalued by between $5.8 and $17.4 trillion dollars. This is the cost to the world, in gold undervaluation alone, of the Deep State’s criminality, corruption and avarice. Being the home and global headquarters of the Deep State, the United States is the only nation in the world whose #1 export, in currency value, is financial fraud.

The War on Gold is suffering from the effects of the Law of Diminishing Returns: it requires more and more Deep State price-rigging to move the gold price down less and less. This is because available supplies of physical gold are rapidly disappearing from west to east, where demand is unquenchable. Tactic #1 is in trouble.

In far greater trouble is Tactic #8. When Indian Prime Minister Modi announced his demonetization scheme at 8 PM on November 8, 2016, the social media network throughout India went supernova within minutes. Citizens who acted immediately were able to dump some or all of their “extinguished” rupee notes for food, medicine, gold and whatever else they could get their hands on from shops still open that evening. The next morning was too late, as the fangs of the scheme deeply sank into the nation’s flesh.

Social media saved the day for those on the vanguard. Similarly, when the people in large numbers sense that something has become rotten in the state of their money and that their savings and financial well-being are at extreme risk, they will take to Social Media in droves to both seek and give advice on how to protect themselves. When this happens, decades’ worth of Deep State fraud and senior miner traitorousness will be washed away in a matter of hours. We already see in Bitcoin how “electronic currency” can go viral even well before a full-blown financial panic. The current Bitcoin phenomenon demonstrates that the people sense something in the air, and are mobilizing. When the wall of propaganda against gold starts to fall, the people will mobilize into it, as well.

As pure money, gold simply has no true competitors. Increasingly, this will become self-evident to tens of millions of people in the west, who will create new demand for it. The physical gold market cannot accommodate such incremental demand at anywhere near the current price. At a certain point, the market will not be able to satisfy physical demand at all, as people realize there is no substitute for and hold on to it for dear life. Nothing on earth produces a price frenzy like a no-offer market.

In our view, people will be richly compensated for front running the coming monetary mass awakening, something we view as being absolutely inevitable. Given the world’s exponentially compounding risks and troubles, the fact that we continue to enjoy halcyon, actionable days can only be regarded as an extraordinary gift from God, to all of us.

Stewart Dougherty is the creator of Inferential Analytics, a forecasting method that applies to events proprietary, time-tested principles of human instinct, desire and action. In his view, forecasting methods not fundamentally based upon principles of human action are unlikely to be reliable over time. He regards the current, intense mobilization of money, power, ideology and ambition to force agendas upon increasingly fractured and reactive peoples and nations as creating extraordinary, unprecedented risk. This risk must be managed personally and institutionally with advanced, strategic thinking and preemptive action. He is a graduate of Tufts University (BA) and Harvard Business School (MBA), has developed his strategic analysis expertise during a 35+ year career, has traveled to and conducted research in over 25 countries and has refined Inferential Analytics into a reliable predictive instrument over a period of 16+ years.

Russia, China Lay Groundwork For BRICS Transactions in Gold

Trading in local currencies has already started — and lays the groundwork for facilitating BRICS transactions in gold

Tue, Mar 28, 2017 

"In China, gold is traded in Shanghai, in Russia, Moscow. Our idea is to create a link between these sites in order to intensify trade between our marketplaces."
“In China, gold is traded in Shanghai, in Russia, Moscow. Our idea is to create a link between these sites in order to intensify trade between our marketplaces.”

Recent progress made in streamlining trade in local currencies has brought Moscow and Beijing closer to creating a financial architecture that could facilitate transactions in gold

As we reported last week, Moscow and Beijing took another step towards de-dollarization with the opening of a yuan clearing bank in Russia. And earlier this month Russia’s Central Bank opened its first-ever foreign branch in Beijing to allow for better communication between Russian and Chinese financial authorities. 

According to an article published yesterday by Sputnik, progress made in promoting bilateral trade in yuan is the first step towards an even more ambitions plan — using gold to make transactions:

The clearing center is one of a range of measures the People’s Bank of China and the Russian Central Bank have been looking at to deepen their co-operation. 


One measure under consideration is the joint organization of trade in goldIn recent years, China and Russia have been the world’s most active buyers of the precious metal.

On a visit to China last year, deputy head of the Russian Central Bank Sergey Shvetsov said that the two countries want to facilitate more transactions in gold between the two countries.

President Trump Says He May Reintroduce The Gold Standard

President Trump vows to reintroduce gold standard

3,500 Tons Pure Gold Bars Unlawfully Shipped Out by Aquino Gov’t, But for Whose Benefit?

The Philippines is rocked again by another scandal involving the previous administration of Benigno Aquino III for having illegally shipped out 3,500 metric tons of 99.999% pure gold, with an estimated value of $141 billion, out of the Bangko Sentral ng Pilipinas’ vault.

Said amount of gold were used to back up the printing of $3 trillion paper currency, early last year. But for whose benefit?

All the personalities allegedly involved are denying participation, saying that the documents presented so far are spurious. However, the Transnational Organized Crime Intelligence Group TAOC-IG investigating the illegal shipment during the previous administration strongly disagrees.

One witness under their custody claims that part of the said hoard are now in Spain. Nevertheless, more central bank insiders are ready to supply additional evidence and stand as direct witnesses to the crime.


What is very peculiar about this gold smuggling is it’s done through the Centennial Energy (Thailand) Company Limited. What is an energy company has to do with gold, or any other sovereign assets, other than masking its true ownership and the intended recipient?

From CIA insider RumorMillNews,

What The Hell Is America Up To Now? Other Than Another Elaborate Operation In Fraud Against The Collateral Accounts

Posted By: igots2no
Date: Friday, 1-Jul-2016 00:09:03

As if Americans need another reason to wonder why we have “blacklisted” their government, and now classified the American government as financial terrorists; preventing them from legally receiving anything from the collateral accounts until they have paid back every cent that they have stolen therefrom over the decades.

When will the American people wake up, or better still, do something about those they have elected and about those of the former elected officials who are undertaking these illegal activities?



Own physical Gold and Coins outside the Western banking system





The USA Imports Record Amounts of Gold from Switzerland! Meanwhile, Deutsche Bank Faces Total Collapse

Written by Nathan McDonald ….October 1st.2016

I have been pointing out for months now that something fishy is going on behind the scenes. It began last month, when I highlighted the fact that the United States had reversed a massive, long-lasting trend of exporting gold, and in fact was beginning to import record amounts of gold from Switzerland. Well, not only has this trend continued, but it has accelerated.

Deutsche Bank refuses clients’ demand for physical gold


© Michael Dalder

Clients of Germany’s biggest bank who have invested in the exchange-traded commodity Xetra-Gold are facing problems when they want to obtain physical gold, according to German analytic website

Xetra-Gold is a bond on the Deutsche Börse commodities market, and Deutsche Bank is a designated sponsor. On the website, Xetra-Gold says its clients have the right for physical delivery of gold.

“Physically backed: The issuer uses the proceeds from the issue of Xetra-Gold to purchase gold. The physical gold is held in custody for the issuer in the Frankfurt vaults of Clearstream Banking AG, a wholly-owned subsidiary of Deutsche Börse. In order to facilitate the delivery of physical gold, the issuer holds a further limited amount of gold on an unallocated weight account with Umicore AG & Co.,” says Xetra-Gold.

However, despite claims that every virtual gram of gold is backed by the same amount of physical gold, clients have been refused the precious metal upon demand.



 Reminder….. If you have/own/  gold and it is not in your hand…..It will not be yours when you try to retrieve…..  READ THIS



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Live 24 hours gold chart [Kitco Inc.]


Deutsche Bank Turns on the Gold-fix Cartel

NEO – New Eastern Outlook:
Published time: 19 April, 2016

Deutsche Bank, Germany’s once-respected giant bank, has admitted being a party–together with a cartel of major Wall Street and select other international banks–in deliberately manipulating the price of gold over a period of years. As well, the German bank, in a court settlement with litigants in a US court, has agreed to name the names of other big banks involved in the criminal enterprise. As this drama unfolds in coming weeks and months, the world may well see the price of gold soar to new heights to reflect the true global market demand. This is huge … To read further, click here


Back in August 2015, I noted that Goldman Sachs and HSBC had taken delivery of a huge tonnage of physical gold, probably purchased near the lows. Physical bars of gold are, by definition, a very long term investment in the yellow metal. At the time, the two banks were telling clients and others not to buy gold, even as they were loading up on it, themselves.

Let’s fast forward…

Starting in December 2015, JP Morgan began buying tremendous quantities of physical gold, as opposed to paper/electronic gold futures, forwards, ETF certificates etc. From December 1, 2015 to December 29, 2016, the big bank purchased and took physical delivery of over 31 metric tonnes worth of bars of the yellow metal for its house account at COMEX alone.

In other words, it now has a physical gold pile which, at minimum, is worth over $1.1 billion at $1,140 per troy ounce, and it is an asset of the corporate bank. By May, 2016, unlike the actions of GS and HSBC in buying while advising clients to sell, analysts at JP Morgan were beginning to encourage customers to buy gold also.

Let me repeat that the enormous purchase of 31+ tonnes of traceable physical gold occurred at New York’s COMEX exchange. The so-called “OTC” gold market in London is five times larger than the gold market in New York City, and if they were buying at COMEX, they were probably buying in London also. The problem with London is that the “LBMA” is not a formal exchange with disclosure rules and regulatory oversight. It is simply an informal collection of banks who operate by agreeing to a common set of rules of engagement. Transactions are secret.

We will never know how much physical gold has been purchased in London by JP Morgan, HSBC, Goldman Sachs or anyone else. However, if JPM’s purchases happen to be synchronized to market size, with New York’s COMEX, they will have purchased another 155 metric tons, for a total of 186 tonnes of gold. Either way, JPM is now in the realm of a sovereign sized gold holding. Most countries hold less than 31 tonnes of gold. Only a handful own more than 186 tonnes.

Why would a commercial bank, like JPM, make such a huge investment in physical gold bars? Is it just opportunism? Is it because they know that gold prices are going to rise dramatically? Do they know this because, as many have alleged, the company houses the most important or some of the most important people who run the gold price manipulation scheme? That’s fun to say but it makes no sense as a explanation for the purchase of so much physical gold. JPM may or may not be a gold manipulator, but that fact is irrelevant with respect to this question.

Generally speaking, the idea behind gold price manipulation is to mint a quick paper profit. If you can convince a foolish and incompetent American President to subsidize your front-running operation, by claiming that it is a way of “stabilizing the value of the US dollar”… all the better. Getting a government subsidy increases profits and reduces risk. But, there is no good reason to choose physical gold as your avenue of manipulation and every reason not to. For one thing, it is a non-leveraged investment. For another, it is more difficult to trade than shares of GLD, other ETFs, gold futures contracts, and mining company shares. All of the latter are far more efficient investments so long as the question of being able to get the real thing doesn’t come up.

In fact, all the big banks, including JPM have bought significant stakes in various gold mining companies over the last 2 years. Why spend money to store and insure physical bars of gold when it is more efficient to mint your profits by simply buying more mining company shares? That’s why the purchase of so much physical gold is puzzling. It seems to me that something bigger must be going on behind the scenes.

JP Morgan is the US Treasury and Federal Reserve’s most important proxy in financial markets. For example, it manages the Fed’s entire mortgage bond portfolio. Physical gold is not normally something that is on the top of the trading floor’s list of preferred products. These purchases are now tying up a significant percentage of the bank’s capital. In order to put so many resources into physical gold bars, JPM’s top management would have had to approve the action. That means the purchases must be supported by some very good underlying reason.

Top JPM management knows a lot more about the inside story about what is going on, behind the scenes, than we know. Is something big about to happen that will dramatically raise the value of real physical gold bars, above more convenient forms of gold ownership? I can think of only two scenarios that would make a large pile of physical gold bars the best corporate investment for a big bank (as opposed to its customers).

One scenario is that JP Morgan knows we have reached the end game and are on the cusp of the long anticipated collapse of the synthetic gold market (ie: gold futures, forwards, “unallocated” storage, maybe GLD etc.). If the gold derivatives market collapses, people will accept only physical gold for a very long time afterward. That would make a physical gold hoard far more profitable than even shares of a mining company. Remember, it takes time to mine more gold. But, the holder of a huge pile of existing bars can sell them, right away, when the level of panic is extreme, at the very top of the market, when demand (and prices) are at their highest.

Another scenario involves being at the cusp of a massive change in the world’s monetary system. If JP Morgan’s top management knows that physical gold is going to be a key part of what replaces the fiat US dollar as the international standard of exchange, and if that change is not very far in the future, it would make perfect sense to buy physical gold. Again, the holder would be in an excellent position to sell the gold bars to third parties (mainly, I suppose, to other banks and even nations) at the very top of the market.

The scenarios I’ve listed, above, are the only ones that come into my mind at the moment. That is not to say that the list is complete. Are there any more possible scenarios that provide a logical answer as to why JP Morgan is investing so much of its capital in such a huge number of physical gold bars?




The Indian Gold Market – An infographic hosted at

 The editor has shared this mantra since this column hit the international readership….here is the first of everyone to do it ….Citibank went bankrupt last month when Deutch Bank blew up  75 trillion in derivatives…AND SO THEY JUST STOLE A BILLION IN GOLD FROM VENESULA… All Western Big Bankers are staying open doors on tricks and lies…….

 “If You Can’t Touch It, You Don’t Own It”

The pending Brexit has, not surprisingly, caused a shakeup in the investment world, particularly in the UK. Of particular note is that, recently, asset management firms in Britain began refusing their clients the right to cash out of their mutual funds. Of the £35 billion invested in such funds, just under £20 billion has been affected. The lesson to take away here is that, if you can’t touch it, you don’t own it. Banks and fund management firms can freeze your wealth, so that you can’t access it. Governments and banks can confiscate your wealth. If you don’t have the power to put your hands on your wealth on demand, you don’t own it.



Did Citi Just Confiscate $1 Billion In Venezuela Gold

Venezuela’s President Nicolas Maduro said on Monday that Citibank planned to shut his government’s foreign currency accounts within a month, denouncing the move by one of its main foreign financial intermediaries as part of a “blockade.” What Maduro did not mention is that among the central bank accounts closed by Citi will be at least one, rather prominent, gold swap launched just over a year earlier, which saw some 1.4 million ounces in gold swapped over to Citi in exchange for cash… gold which now appears to be confiscated.

We did our best to warn stackers..get your gold in hand….

Sweden’s Largest Gold and Silver Dealer’s Bank Accounts Closed, Shut Out of Banking System!

The cartel have tipped their hand.  The plan is not to come after your gold and silver coins, it is to shut down thegold and silver dealers themselves, and prevent access of safe haven capital flows from reaching the safety ofgold and silver bullion.

Case in point?  Sweden’s largest gold and silver dealer Tavex Guld & Valuta, whose bank accounts were suddenly closed Thursday without notice by Swedish bank SEB due to ‘a general business decision’Notice posted on Tavex Guld & Valuta’s website that as of 15:30 on June 30th 2016, they can no longer accept bank deposits or transfers as SEB has shut down their accounts without notice, leaving the PM firm scrambling to set up alternate payment systems

A New Balance Of Power In The Gold Market

Tyler Durden's picture

With precious metals soaring on safe haven buying…

We thought John Rubino’s thoughts (via were particularly prescient…

Gold analyst Michael Ballanger just posted an article noting how much things have changed — perhaps for the better — in the gold market. Here’s an excerpt:


Commercial Traders Have Just Gone Over the Top

(24hGold) – With Friday’s Commitment of Traders Report, the ridiculous has just metastasized into the sublime as the Commercial Cretins have just gone “over the top” and added another 5.4M “ounces” to their synthetic gold short position. At 298,077 contracts declared short, they are now carrying the largest short position in Crimex history. The scary part is that these figures don’t include the big rise in open interest yesterday and you just KNOW that it ballooned out due to more Cartel shorting.


Gold COT June 16


While these numbers are synonymous with prior tops like in 2008 and 2011, the difference today lies in two realities: 1) The Shanghai Gold Exchange is keeping the Crimex and LBMA (London Bullion Market Association) thieves at bay through some voracious arbitrage, and 2) Raw demand from the Far East and from Western investment pools are keeping inventories tight. If this was back in 2011-2015, the market would be limit down on Monday as the criminals have their way with us. However, this is a NEW bull market and dips are to be bought while holding onto your core position for dear life as I have been trying to do with my GDXJ (Market Vectors Junior Gold Miners ETF) position. I can’t tell you how many times I have had to lock myself in the wine cellar during trading hours because the temptation to “SELL!” was so overwhelming.


The bullion banksters and their well-armed trading desks have now arrived into somewhat of a “pickle” in that the movie reel that they thought would play out with the bad guys winning and gold following through to the downside on what should have been another Freaky Friday where gold and silver get clobbered. Since it DIDN’T, they now have to await selling from the Asian markets in order to give them the slightest chance of a downside flush this coming week.


What IS a certainty is that the PMs are trading in a totally bizarre fashion, and anyone who fails to pay attention to Commercials are indeed paying no attention to “that man behind the curtain” who most certainly is pulling levers and spinning dials frantically in order to secure the desired effect while being short nearly 30 Moz of phony, synthetic gold that closed within a whisker of a new closing high for the move. There must be carloads of Pepto and adult diapers being handed out to the Cretins as the wait in agony for the Sunday night opening.

Let’s expand on that “voracious arbitrage” idea: The Shanghai exchange is a physical market, where buyers go to get actual gold and silver. So prices there are set by sellers with metal to move and buyers who want to take delivery. On the Western paper exchanges, in contrast, the players mostly gamble on price movements using futures contracts with very little actual metal changing hands.
But if the price set in the Shanghai physical market is higher than in the paper markets — reflecting the different aims of the respective sets of traders — then it becomes profitable for holders of long futures contracts in the West to demand delivery of the metal, ship it to China and sell it at the higher Shanghai price.

Once this process gets going it will quickly clear out the inventories of the Western exchanges, leaving nothing for future arbitrageurs. The exchanges will then force those wanting delivery to accept cash instead, in effect defaulting on their promises. Then it’s game over, with the big futures manipulators no longer a factor in pricing.

Presumably from then on gold and silver prices will reflect rising physical demand in the East (and in the West from individual stackers). And gold will begin its long climb to the $10,000 or so price necessary to balance the amount of fiat currency created during the inflation of the Money Bubble.

This phase change could take a while, creating the possibility of some more nasty corrections while the paper players retain the upper hand. And once it gets going it could be steady and relatively peaceful or a “punctuated equilibrium” move where the failure of an exchange or bullion bank sends gold from $2,000 one day to $6,000 the next. Either way, the dominance of physical exchanges implies that much higher prices are coming.

China Quietly Prepares Golden Alternative to Dollar System

gold bars small crop


Astute observers of financial markets, especially in the precious metals sector, have long argued that small concentrations of major market players have been manipulating asset prices. Last week those suspicions were confirmed when Deutsche Bank, one of the world’s leading financial institutions, not only admitted to regulators that they have been involved in the racket, but that they were prepared to turn over records implicating many of their cohorts in a global scheme to suppress prices.

In his latest interview with SGT Report, straight-shooting Callinex Mines CEO Max Porterfield explains that now that the men behind the curtain are being revealed, asset prices in precious metals, base metals and other commodities will return to more natural pricing mechanisms based on core supply and demand fundamentals.


They are being revealed, most certainly… whether anybody actually takes a fall for it is a whole ‘nother discussion in its own right.. It’s good someone is being held accountable in some form or fashion and at least we understand what we’re dealing with.


… The real world pricing is being seen not only in the precious metals space, but it’s being played out in other base metals as well… Underlying all this manipulation is really the supply demand fundamentals for all these commodities…

Full Interview Via SGT Report:


With the genie now out of the bottle, many of the institutions involved in price manipulation and suppression appear to have backed off for fear of multi-billion dollar class action lawsuits from investors. The direct result, as we have seen just in the last couple of weeks, has been upward price movement in gold and silver.

If you start getting some of the manipulation to come out of the market for fear that people are going to get called out on it, then you can allow the fundamentals to play out.

And according to Porterfield, those fundamentals bode very well for gold, silver and base metals investors who have thus far been pillaged by paper market conspirators:

I think this has signified the start of a new bull market… what we’ve been through, these nice gains… I can tell you right now… I travel frequently to investor hubs in North America and Europe as well… the sentiment is improving quite significantly compared to where it was last November when I was in Zurich where people were very, very negative.

There’s more optimism in the space, particularly in the precious metals space… and in the not-too-distant future in the overall base metals space as well.

I think investors should be aware and be prepare for pullbacks in any bull market and I think that’s healthy for any kind of bull market you’re in… it is a bumpy road no matter what… but there’s definitely a lot more upside ahead of us.

We know that during the bear market in gold, silver and other commodities many companies either slowed their operations or completely shut their doors. This reduction in supply, a growing demand for precious metals amid global economic chaos and the official acknowledgment of paper price suppression by at least one major financial institution (and likely many more) suggests that gold and silver prices could rise significantly over coming months and years.





Rally In Gold Stocks Reaches First Big Challenge

A key index of gold stocks is hitting its first level of major potential resistance since its false breakdown to all-time lows in January.

Flashback to January 26 of this year. The PHLX Gold/Silver Index, or XAU – the longest running index of gold stocks – was recovering from its breakdown earlier in the month to all-time lows. That day, the XAU was testing the breakdown level around $43. Our Chart Of The Day and accompanying post linked above queried “Will this test of the breakdown level lead to a false breakdown, or the start of a new leg down?” Well, 3 months and over 100% later, that answer couldn’t be more clear.


The question now is “How far will the post-false breakdown rally go?” Fast forward to today and, in our view, the rally in the XAU is hitting its biggest challenge yet in terms of potential resistance on it chart. Consider the levels of consequence near the $86 level as laid out on the chart below:

The underside of the broken post-2000 Up trendline

  1. The post-2011 Down trendline
  2. The 23.6% Fibonacci Retracement of 2010-2016 Decline
  3. The October 2014 breakdown level that led to an acceleration of the cyclical post-2010 decline. This “pivot” level also represented the triple lows in 2013-2014 and subsequent test in January 2015.










19.04.2016 Author: F. William Engdahl


Deutsche Bank Turns on the Gold-fix Cartel

DB_Frankfurt_ZentraleDeutsche Bank, Germany’s once-respected giant bank, has admitted being a party–together with a cartel of major Wall Street and select other international banks–in deliberately manipulating the price of gold over a period of years. As well, the German bank, in a court settlement with litigants in a US court, has agreed to name the names of other big banks involved in the criminal enterprise. As this drama unfolds in coming weeks and months, the world may well see the price of gold soar to new heights to reflect the true global market demand. This is huge.

The first time I came across evidence that select Wall Street and other major international banks, in cooperation with the Federal Reserve, were deliberately suppressing the world gold price was in the aftermath of the global stock market crash of October, 1987. That was when the Dow Jones stock index lost 23% in one day. John Crudele, an exceptionally persistent financial journalist with theN.Y. Post and John Williams of Shadow Government Statistics and an exceptional economist, informed me at the time of the gold manipulatipon reports. The reason for the fix, which then-Fed chief Alan Greenspan reportedly orchestrated, was to prevent a stampede by panicked investors out of risky stocks and bonds into gold. Had gold profited from the stock panic, it could well have been an early end to the dollar system. It worked then to prevent a gold rise.







The Root of Gold Conspiracy Theories

Written by Keith Weiner (CLICK FOR ORIGINAL)



Most people who own or trade gold have a higher price in mind, a price determined by what they think the metal is worth in dollar terms. That’s normal. However, some make a leap from the fact that gold doesn’t trade at this price today, to belief in manipulation. Short sellers—who are sometimes supposed to be illegally profiting, and sometimes said to be not-for-profit—come in to the market and sell the metal down. Or so the theory claims.

This theory is not true, and I plan to show the data to prove it in a future article. For now, I want to discuss the fallacy at the core of it.

The error is dollar thinking.

What do I mean? Simply, most people assess the value of something based on its price in dollars. If nefarious parties could somehow suppress the price of gold, then they could undermine its value. That would be an evil act. How could one not feel something, at such a crime against the natural order? It’s personal too, an attack on your very wealth. You buy gold to protect yourself from a likely dollar collapse, and instead find you are losing your wealth. You’re forfeiting it to the very monetary planners from whom you thought gold would protect you from in the first place: the central banks.

Let me suggest that this is the wrong way to think about it. Gold does not go down (or up). Gold cannot be properly measured in dollars……...Read more





Russia Gold “Buying Spree” Continues – Buy 22 Tons In November

GoldCore's picture

– Russia adds another 700,000 ounces (22 tonnes) to gold reserves in November
– Russian ally Kazakhstan increased gold reserves for 38th month to 7 million ounces
– Russia has added 197.1 tonnes in 2015 – Compared with 172 tonnes in all 2014
– November gold buying is Russia’s ninth straight month of increase
– Russia now has sixth largest gold reserves in the world
– Central bank buys all Russian gold production
– Other Russian gold demand imported
– Russia views gold bullion as “100% guarantee from legal and political risks”


Russia continues to add to its gold reserves and added another 700,000 ounces in November or another 22 metric tonnes, and analysts believe this buying will continue and may intensify in the coming months.










Russia Sees Gold Reserves As “Additional Financial Cushion” In Face Of “External Uncertainties”

– Gold and fx reserves are “additional financial cushion” for state in face of “external uncertainties”
– Russia bought another 77 tonnes of gold in Q3
– Ruble volatility does not create risks for financial stability in Russia
– Russia intends building fx and gold reserves to $500 billion in coming years
– Gold is a “100% guarantee from legal and political risks”

Russian central bank governor, Elvira Nabiullina spoke about Russia’s gold and foreign currency reserves today saying Russia intended building them up to $500 billion in the coming years. More importantly, she confirmed that Russia continues to see gold reserves as an important monetary  asset – in her words as a “financial cushion.”


GoldCore: Russian Central Bank Gold Reserves




JS Kim Issues Critical Warning About Newly Introduced Global Banking “Gold Programs”. Could Bankers Be Duping Us into Yet Another One of Their Reverse Alchemy Schemes?

Indian Prime Minister Narendra Modi launched a 3-pronged scheme to allow gold to become an important part of the Indian economy – a gold monetization and bank deposit scheme, the issuance of bank and federal gold-backed bonds, and a gold coin and bullion selling program, in which an initial 15,000 5gm gold coins, 20,000 10 gm coins, and 3,750 20gm bullion bars will be made available to the Indian public.


The only aspect of this 3-pronged program, however, that I deem trustworthy at this point, until proven otherwise, is the gold coin and bullion selling program. Why? The answer is simple. The other 2-aspects of this 3-pronged program advocate against our advice at SmartKnowledgeU to specifically hold all of your gold in physical form only and outside of the global banking system. Both the gold monetization scheme and the gold-backed bond scheme require depositing physical gold at a bank and receiving digital credits and paper in return. If bankers never commit fraud and always keep 100% of the gold allocated specifically to the depositor, and we can be 100% guaranteed of this stipulation always being enforced at all times, then I would not have a problem with India’s gold monetization program and gold-backed bond program. The only problem is that history tells us that bankers will always commit fraud under these circumstances. Consequently, why should we take their word this time around that they will not commit fraud again and use the gold deposits to undermine and suppress the price of gold against the gold depositors’ best interests?


For example, we already know, beyond a shadow of a doubt, that the gold derivatives futures markets in New York and London are entirely fraudulent and that pricing mechanisms in these markets literally have zero relationship to the supply and demand determinants of physical gold. The UK Financial Conduct Authority fined Barclays Bank £26 million and banned Barclays banker Daniel Plunkett for artificially engineering a gold “puke” in gold futures markets to plunge gold prices on a specific day to ensure that they would cheat their client out of a payment of £2.3 million. Furthermore, this fraud would never have even been exposed had it not been for the client’s sophistication in understanding and identifying the fraud executed by the Barclays banker. I literally have witnessed other bankers execute the exact same pattern of fraud executed by Barclays banker Plunkett dozens of times in the past, and for which no banker was arrested or prosecuted. Given the history of banker fraud in gold paper derivative markets in which banks use paper markets to plunge gold prices, Indian citizens must ask themselves this pressing question, “Do I really want to give up the security of holding my physical gold outside of the banking system and then deposit it with the very bankers that have been repeatedly proven to execute fraud against my best interests?



Singapore is one of the most stable countries in the world today – both politically and economically, and is emerging as the preeminent precious metals trading hub in Asia. 

Today there is a growing move to own gold outside of massively indebted and near insolvent western banks and sovereigns. This trend looks set to continue given the very poor state of most western nations and Singapore looks set to be a beneficiary of this trend.


Gold Soars Into Green Year-To-Date, Breaks Above Key Technical Level

Gold has broken above its 200-day moving-average and pushed back into positive territoiry for 2015 amid a notable surge in prices (after whipsawing around in the last 24 hours). As the USD Index suffers its first ‘death cross’ in over 2 years,perhaps Paul Singer’s comments are starting to gather momentum.


Soros, Icahn And Major New Players Rushing Into Gold: “Things Are In The Works As We Speak”

I do believe that markets ultimately prevail. I do believe that supply and demand will ultimately prevail. I’m confident that we will see that occur… The fact there are some very substantial new players coming into the sector and taking positions in gold and silver… I think that’s showing that things will change and I think things are in the works as we speak.”

Druckenmiller Buys A Lot Of Gold

Stan Druckenmiller is going big on gold.

Druckenmiller is one of the world’s most successful and respected traders. As a hedge fund manager from 1986 to 2010, he generated an incredible average annual return of 30%.

Druckenmiller was also George Soros’s right-hand man at Quantum, Soros’s famed hedge fund. Quantum’s now legendary 1992 trade shorting the British pound was Druckenmiller’s idea. It made Quantum about $1 billion. People say the trade “broke the Bank of England.”

Most professional investors preach diversification. But Druckenmiller says he’s successful because he’s not afraid to concentrate his bets when he really believes in a trade. He calls it “being a pig.”

Druckenmiller’s fund recently bought $300 million worth of SPDR Gold Trust (GLD), an ETF that tracks the price of gold. It’s a huge bet, even for a big-time trader like Druckenmiller. He put 20% of his fund’s money into this trade, and it’s his largest position.









“I Own Krugerrands” Says Legendary Jim Grant

– He is “very bullish indeed” on gold
– Gold is “investment in financial and monetary disorder” – says Grant
–  It thrives in current environment – “uncertainty, turbulence and disorder”
– “One of the most radical periods of monetary experimentation in the annals of money”
– “Gold…is now the conjunction of price, value and sentiment”
– Reminds owners of gold that the original reasons for buying gold have not gone away
– Believes Fed will raise rates despite deflationary environment
– Explains detrimental effect of excessive debt on an economy
– Grant light-heartedly destroys Jason Zweig’s “pet rock” gold jibe









Gold Smash Leads to Surge in Demand For Coins, Bars Around World

– U.S. Mint sees highest monthly gold eagle sales in over two years
– Indians take advantage of low price in a season not typically known for gold buying
– Chinese investors, disillusioned with stock market, are buying gold in large volumes
– Demand for coins from Perth Mint 37% higher in June and even higher for July

The manipulative smash on the gold price on Sunday night has once again led to a surge of buying of gold coins and bars across the globe. Both the Wall Street Journal and Reuters report on how bullion dealers are seeing a spike in demand for gold coins and bars in  India and China and indeed Europe, Australia and the U.S.

The U.S. Mint – which ran out of Silver Eagles earlier in the month due to unexpectedly high demand – has sold 110,000 Gold Eagle one ounce coins so far this month according to Reuters. This compares with a mere 21,500 ounces sold in May and 76,000 in June. It represents the highest level of monthly demand in over two years – with more than a week to go till the end of the month.






Russians Buy Gold Again In June – Another 25 Tonnes

– Russia adds another 800,000 ounces or 25 tonnes to gold reserves in June
– Russia’s has sixth largest gold reserves in the world
– Allocates 13% of FX reserves to gold
– Central bank buys all Russian gold production
– Other Russian gold demand imported
– If billionaire oligarchs diversify into gold, prices will rise sharply
– Russia views gold bullion as “100% guarantee from legal and political risks”


With all the focus on the Chinese lowballing their total institutional gold holdings, combined CIC, SAFE and PBOC, this week and the continuing attacks and manipulation of the gold market on Sunday night, the latest large increase in Russia’s gold reserves has gone largely unnoticed and barely covered by commentators – especially the more vocal bearish ones.

Russia continues to add to its gold reserves and added another 800,000 ounces in June or another 25 metric tonnes, and analysts believe this buying will continue in the coming months.








China just revealed how much gold it’s been hoarding for the first time since 2009



mao gold china graft


A visitor stands in front of a statue of China’s late Chairman Mao Zedong made of gold, jadeite and diamond.

Back in April we wrote that “The Mystery Of China’s Gold Holdings Is Coming To An End” as a result of China willingness to add the Yuan to the IMF’s SDR currency basket which would require the disclosure of China’s gold holding ahead of an IMF meeting on SDR composition which may be held in October.

By way of background, the reason why everyone has been so focused on Chinese official gold holdings is that there has been no official update to the gold inventory of the world’s biggest nation, which have been fixed at 33.89 million oz since April 2009, a little over 1000 tons. In other words, the PBOC’s gold inventory has been “unchanged” for over 6 years which is in stark contrast to the ravenous buying of physical gold China has been engaging in for the past 5 years.

 Well, the long awaited moment has finally arrived and this morning, after a 6 year delay when, China finally admitted that it had been misrepresenting its gold holdings for a very long time, when it announced that its gold holdings had increased from 38.89 million to 53.31 million troy ounces, a 57% increase “in one month.”











Gold is looking like the dog that just did not bark — but not uniquely so. Most safe-haven assets are looking distinctly lackluster, including the VIX index. Either 5,000 years of safe-haven buying has just become bunk, or there is a desire to portray what is evidently a financial and economic crisis as nothing to be concerned about.”

Ross Norman, Sharps Pixley

“In keeping silent about evil, in burying it so deep within us that no sign of it appears on the surface, we are implanting it, and it will rise up a thousand fold in the future. When we neither punish nor reproach evildoers, we are not simply protecting their trivial old age, we are thereby ripping the foundations of justice from beneath new generations.”

Aleksandr Solzhenitsyn, The Gulag Archipelago

At least in my judgement, the precious metal markets are being consistently rigged.

I believe the reason that they are being rigged is that the financiers have convinced the political class that this is a necessary action in order to prevent a panic, a run on the dollar and the bonds, and a seepage of critical funds into an unproductive investment as compared to equities for example.

We are just defending what is ours, right? And what is ours is the global dollar hegemony.

This is really just another excuse for looting, picking both the global public pockets and the Treasury’s.

This sort of thing seems to happen periodically, at least once per generation, and the system generally has to get washed out badly, and then reform may come. You can see a clear trend back to the early Reagan years for this particular dalliance with the overreach and madness of the moneyed interests.

Protracted market rigging tend to distort supply profoundly. And there should be no doubt that the distortions and excesses of our current round of economic quackery have caused an historic imbalance of wealth and power.  And the rigging of the gold and silver markets have badly affected the ability of supply to meet demand.






Gold Bullion Dealer Unexpectedly “Suspends Operations” Due To “Significant Transactional Delays”






Russia Buy Gold Bullion For “Principles Of Diversification” – Central Bank Governor

– Russia “bought gold” for “diversification” – Russian Central Governor Nabiullina
– Russian central bank prefers gold bullion to euros or dollars
–  Russia points out that other countries have a  “bigger share of gold in their reserves”
– “Can’t imagine a situation where bitcoins would be considered a reserve currency”
– On bitcoin – sees “mobility”, “expediency” and “low cost” but may regulate

Russian Central Bank Governor, Elvira Nabiullina

The Russian Central Bank Governor told CNBC this morning that Russia has bought and will continue to buy gold bullion for “principles of diversification.”

In an interview with Geoff Cutmore of CNBC, Elvira Nabiullina was asked


“Why would you be adding significant amounts of gold at this time when you could be taking euros or dollars or other foreign currencies to makeup reserves?”

Elvira Nabiullina said that the Russian central bank believes in diversification and bases itself


“upon the principles of diversification of our international reserves and we bought gold not only last year but during the previous years. Our gold mining industry is very well developed and it is ready to supply gold. That is why our attitude towards here is based upon diversification of our reserves.”

goldcore_chart2_18-06-15When asked whether Russia was buying gold produced in Russia in order to support the Russian gold industry as they may be struggling to export gold abroad, she disagreed and said that Russia does not have the “objective” of “supporting any specific industry” and she pointed out that Russia’s gold reserves are still quite small when compared to other countries – presumably referring to the U.S., believed to be the largest holder of gold reserves.








Singapore is one of the most stable countries in the world today – both politically and economically, and is emerging as the preeminent precious metals trading hub in Asia. 

  1. Key Benefits of Storing Bullion in Singapore:Favourable Tax Treatment, Leading Storage Providers, Pools Of Liquidity, Refining Capacity, World Class Physical Infrastructure.








Kyle Bass Was Right: Texas To Create Own Bullion Depository, Repatriate $1 Billion Of Gold

Most investors have heard Kyle Bass’ rather eloquent phrase, “buying gold is just buying a put against the idiocy of the political cycle. It’s that simple.” However,what few may remember was his warnings in 2011, suggesting the University of Texas Investment Management Co. take delivery of its gold – as opposed to trusting it in the ‘safe’ hands of COMEX massively levered paper warehouse. Now, as The Star Telegram reports, Texas is going one step further with State Rep. Giovanni Capriglione asking the Legislature to create a Texas Bullion Depository, where Texas could store its gold. The goal is to create a secure facility that would allow the state to bring home more than $1 billion in gold bars that are owned by UTIMCO and are now housed at HSBC in New York.





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Live 24 hours gold chart [Kitco Inc.]






Hands down, the cheapest place in the world to buy gold coin


For anyone looking to hold gold as a store of value or even medium of exchange,  major gold coin mintage’s like the Eagle, Maple Leaf, and Krugerrand are advantageous because they’re recognizable worldwide. You can do business in a coin shop anywhere in the world from Vancouver to Vanuatu with one of these coins; bulk bullion, on the other hand, needs to be specially weighed and assayed by experts before being traded. For this reason, the premiums for which gold coins sell tend to rise substantially in crisis periods when demand for physical metal is high. In the initial days of the 2008 financial crisis, premiums shot up from 4% to well over 10%, even though the price of gold was simultaneously falling sharply. Hang Seng Bank, Bank of China, and Wing Lung Bank. At Hang Seng Bank, Canadian 1 Oz Maple Leaf coins — in pure, 24 karat gold — were available for cash purchase in Hong Kong dollars at just 0.5% above the prevailing spot price of gold. This is dirt-cheap… or as they say in Chile, ‘precio de huevos’, and it certainly presents an interesting arbitrage opportunity. Depending on your objectives, however, there may be even better gold coin buys in Hong Kong at the moment. Over at the Bank of China, for example, the Chinese Panda coins were quoted at 4.9% above spot gold. Personally, I think the Panda is one of the most beautiful gold coins of all, and in North America they typically sell for much greater mark-ups above the spot price of gold than most other coins, often over 20%. In the UK it’s even more.


Many collectors value the Pandas simply for their aesthetic beauty; and it probably doesn’t hurt that the dealers authorized by the People’s Bank of China to sell Pandas in the US have a virtual monopoly on the market. Still, this situation can be exploited to your advantage– the difference between the buy price in Hong Kong and the sell price in North America is roughly $275 per 1-ounce coin.


“People criticize owning bullion because there’s no yield. But there’s a reason everything else needs a yield, to compensate you for things like obsolescence risk, business-cycle risk and management risk, all of the things that gold does not have.
We’re not gold bugs, but there’s a reason humanity has tended to use gold as an alternative to man-made currency – it’s the only virtually infinite-duration asset in the world.”

“But when you recall that one of the first moves by Lenin, Mussolini and Hitler was to outlaw individual ownership of gold, you begin to sense that there may be some connection between money, redeemable in gold, and the rare prize known as human liberty.”







Gold Jumps After India Reveals Import Surge

Gold prices jumped overnight on initial rumors and again in the last hour as Indian officials note that March Gold imports surged to 125 tons (more than double last March’s 60 tons). As Reuters reports, Gold imports in the fiscal year 2014/15 ended March 31 jumped to 900 tonnes, up 36% from a year ago. Surging imports are helped by a falling price since the beginning of the year combined with the relaxation of government (capital control) import restrictions, and despite further efforts by the government to “monetize gold.”






Gold In Fed Vault Drops Under 6,000 Tons For The First Time, After 10th Consecutive Month Of Redemptions

According to the most recent earmarked gold data reported by the Fed, in the month of February another 10 tons of gold departed the NY Fed, following 20 tons in the month before, which if one assumes is merely the delayed relocation of gold previously demanded for delivery, has crossed the Atlantic and is now to be found in Frankfurt. This means that for the first time in the 21st century, the total gold tonnage held at the NY Fed is now under 6000 tons, or 5,989.5 to be precise.






Tyler Durden's picture
Failed Discipline, Failed Reforms And Grexit: Why The Euro Failed
It’s not that difficult to understand why the euro is doomed to fail. Given its structure, there is no other possible outcome but failure. Greece’s exit (Grexit) will simply be the first manifestation of the inevitable structural failure of the euro. To understand why this is so, we have to start with two forms of discipline: the market and the state.




Is Russia Planning A Gold-Based Currency?

The “perfect-storm” of geopolitical instability, diplomatic isolation, severe currency depreciation, and economic decline now confronting Russia has profoundly damaged Moscow’s international standing, and possibly for the long-term. Yet, it is precisely such conditions that may push the country’s leadership into taking the radical step that will secure its world-player status once and for all: the adoption of a gold-exchange standard.


The Keys to the Gold Vaults at the New York Fed – Part 2: The Auxiliary Vault

The FRBNY’s Auxiliary Vault

As mentioned in Part 1 of Keys to the Gold Vaults at the New York Fed, there are two gold vaults at the New York Fed, the main vault and the auxiliary vault. Very little is written anywhere about the FRBNY’s auxiliary vault, or the ‘aux vault’ as it has sometimes been referred to.

The auxiliary vault also fails to make an appearance during the New York Fed’s famous gold vault tour. It’s as if the Fed specifically wants to keep this aux vault off the radar, or at least flying under the radar.

Although neither the 1991 nor the 1998 versions of the Fed’s publication ‘Key to the Gold Vault’ (KTTGV) refer to the auxiliary vault, the 2004 and 2008 versions do (in passing) as follows:

Bullion at the Federal Reserve Bank of New York belonging to some 60 foreign central banks and international monetary organizations is stored in 122 separate compartments in the main and auxiliary vaults.” (page 5, 2004)

Bullion at the Federal Reserve Bank of New York belonging to some 36 foreign governments, central banks and official international organizations is stored in 122 separate compartments in the main and auxiliary vaults.” (page 5, 2008)

All four of the on-line versions of ‘Key to the Gold Vault’ that I sourced (from 1991 – 2008, see Part 1) state that the “main vault was opened in September 1924” and so this statement indirectly implies that there is another ‘non-main’ vault.

The reference to the auxiliary vault in the more recent 2004 and 2008 versions of KTTGV seems to imply that the aux vault is still in active use for gold storage. Otherwise, why would the Fed mention it?

Just to clarify what auxiliary means. Various dictionary definitions of ‘Auxiliary’ include the following: supplementary, additional, subsidiary capacity, backup reserve. In the context of space, auxiliary refers to additional space.

New York Fed writer Charles Parnow’s ‘A Day at the Fed – Charles Parnow’ publication (first published in 1973) explicitly refers to the auxiliary vault with a quite precise reference. This is probably the only detailed description of the auxiliary vault that’s on record, and it states:

“A smaller auxiliary vault built in 1963 holds three accounts. One account with 107,000 bars of gold is stacked with bricklayer precision into a solid wall 12 feet high, 10 feet wide, and 18 feet deep.” (From: ‘A Day at the Fed’)


The above photo from the NY Fed shows a self-described ‘wall of gold’. If you look closely to the very left of the photo, the number ‘2’ is visible about half way up the white column beside the wall. This vault layout is very different to the small cages or compartments featured in most of the FRBNY’s gold vault photos. Therefore this wall of gold shot appears to be from a totally different location than the main vault.

Could this be a shot taken in the auxiliary vault? Most probably. Apart from the above photo, there are two additional photos below that I believe are also shots taken within the auxiliary vault. One shows 3 men with clipboards, presumably Fed staff and auditors, looking at a wall of gold. The other shots shows 2 Fed vault workers, with protective magnesium shoe covers, adding bars to a wall of gold, and out of shot a third person consulting some type of weight list.

If, in the early 1970s, when Charles Parnow’s above comment was first penned, the aux vault stored gold for only three customers, then the Fed may have simply just used three areas or alcoves in the aux vault, listed as 1, 2 and 3, in which to store customer gold for three customers. However, without knowing the vault layout its difficult to say.

Wall of Gold











Posted on 23 Jan 2015 by

The Keys to the Gold Vaults at the New York Fed – Part 1

Over time, the Federal Reserve Bank of New York (FRBNY) has become increasingly less transparent in sharing information about its Manhattan gold vaults. I use gold vaults in the plural because there are two gold vaults at the New York Fed’s headquarters, namely, the main vault and the auxiliary vault.

During the 1970s, New York Fed financial writer Charles Parnow wrote some informative and revealing material profiling the Fed’s Manhattan gold storage arrangements, however, the original text from these publications has been gradually rewritten, distilled, and watered down over time, and today hardly anything of substance about the Fed’s gold vaults makes it on to the New York Fed’s web site.

Luckily, most of this older information is still available from various on-line sources including a number of versions of an FRBNY publication titled ‘Key to the Gold Vault’, and another publication called ‘A Day at the Fed’. Old newspaper articles provide additional coverage.

Although most of the information in the Fed’s brochures has been covered elsewhere and is fairly well-known, there are a number of important and mostly forgotten facts from the early editions of these brochures which I think make an analysis of this material worthwhile. These facts centre on the following:

a) The FRBNY’s Auxiliary vault and its probable location

b) The arrival of low-grade Coin Bars at the FRB in New York in 1968

c) The substantial withdrawals of gold from New York from 1991 to the present day

d) The noticeable decline since the late 1970s in the number of central banks with gold holdings at the FRBNY

Entering the Main Vault - FRBNY

Chink of Light?

In October 2010 the Financial Times touched upon a small part of the FRBNY’s gold operations in an article titled ‘Chink of light shed on New York Fed gold’. The article, written by the FT’s Jack Farchy, reported that the FRBNY had revised down from 60 to 36 the number of foreign central bank customers that it claimed to hold gold on behalf of.

According to the FT, this change shed “a rare chink of light on the opaque activities of central banks in the gold market.”


Russia and surprisingly the Netherlands were the largest central bank buyers in December – accumulating a significant 30.34 tonnes between them as currency wars intensify. 

Demand for gold as a diversification and monetary asset continues to be very robust and central banks remain net buyers of gold which should be supportive of prices.


The Netherlands, which has the ninth-biggest gold reserves,  raised its bullion holdings for the first time in 16 years. It added  9.61 tonnes to bring total gold reserves to 622.08 tonnes.

Russia raised its gold reserves for a ninth straight month in December as the country continued its multi month gold buying spree, adding to the fifth-biggest gold holdings in the world, data from the IMF showed yesterday. 

Russia continues to dollar cost average into gold and increased its bullion holdings by another hefty 20.73 tonnes to 1,208.23 tonnes in December.

The December figure for Russia, who have the fifth largest reserves in the world, brings their officially stated reserves to 1208.23 tonnes. If this trend were to continue their officially stated reserves would increase 20.6% this year.









This Is What Gold Does In A Currency Crisis, Euro Edition

Yesterday the European Central Bank acknowledged that the currency it manages is being sucked into a deflationary vortex. It responded in the usual way with, in effect, a massive devaluation. Eurozone citizens have also responded predictably, by converting their unbacked, make-believe, soon-to-be-worth-a-lot-less paper money into something tangible. They’re bidding gold up dramatically.


Lets get personal with  this leader board up close and  swiftly...



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A World On The Brink As We Begin 2015
A World On The Brink As We Begin 2015

Gold Rigging Settlement With UBS – Other Banks To Follow

Suspicions that the price of precious metals are frequently manipulated by a few international banks were further confirmed over the weekend. UBS agreed to settle with various international regulatory bodies investigating rigging in foreign exchange and precious metals markets. 
Possibly the single most important benchmark of global gold demand today remains gold withdrawals from the Shanghai Gold Exchange (SGE).

Previous weeks saw a very robust week for Chinese demand despite talk of weak demand and low premiums in China.  This means that the world’s largest gold buyer continues to be headed for annual gold demand of some 2,000 tonnes.

Manipulation of markets can work effectively in the short term (see above). However, in the long term prices will be dictated by the global supply and the global demand of 7 billion people, many in Asia who believe in gold as a store of wealth.

Not to mention, sovereign central banks such as the People’s Bank of China and the Russian central bank – who also believe in gold as an important monetary asset.  


To say that gold is in a bear market is to misunderstand both gold and markets. Gold isn’t an investment that goes up and down. It is money in the most basic store-of-value sense. Most of the time it just sits there, and when its price changes in local currency terms that says more about the local currency than about gold.

But when currencies collapse, gold shines.

Consider the above from the point of view of a typical Russian. The ruble is tanking (no need to understand why — all fiat currencies go this way eventually and the proximate cause is almost irrelevant). Russians who trusted their government and kept their savings in, say, a bank account, are losing their shirts. But those who own boring, doesn’t-pay-interest, in-a-bear-market gold have seen their capital appreciate in local currency terms by about 60 percent in just the past month. They’re not “making money,” but they are preserving wealth.

Russian gold price Dec 2014

This is how it has gone always and everywhere when governments have destroyed their currencies. In the Roman Empire, revolutionary France, revolutionary America, most of Latin America in the 20th century, and now big parts of the developing world, local currencies evaporate but gold just sits there, buying the same amount of stuff as ever, impervious to the games governments play.

It won’t be long before this chart is replicated in a whole lot of other places. But by then it will be too late to prepare. The gold will be gone and those who trusted their governments will have to make do with promises.

“Riddles” Surround 36th Dead Banker Of The Year

52-year-old Belgian Geert Tack – a private banker for ING who managed portfolios for wealthy individuals – was described as ‘impeccable’, ‘sporty’, ‘cared-for’, and ‘successful’ and so as Vermist reports, after disappearing a month ago, the appearance of his body off the coast of Ostend is surrpunded by riddles…



With Its Gold “Vaporized”, A Furious Ukraine Turns On Its Central Bankers

As reported two weeks ago, following to a stunning announcement by the head of Ukraine’s central bank, Valeriya Gontareva, we learned that (virtually) all of Ukraine’s gold was gone, or – in the parlance of Jon Corzine – had “vaporized.” And as we also predicted two weeks ago, it was only a matter of time before Ukraine’s people – the vast majority of whom are innocent pawns in a vast game of realpolitik between the west and east – finally got angry and demanded some answers. That time came earlier today when as reported “a Kyiv-based court has instructed Kyiv prosecutors to bring an action against National Bank of Ukraine (NBU) Governor Valeriya Gontareva on charges of abuse of power or misuse of office to obtain illegal profit, the Vesti newspaper reported on Tuesday.”

Joe weisenthal joining the and what a shock yesterday, there you and i were — the most exciting thanksgiving since 2009 which was marked by the dubai default and that was the first time we started talking about europe and whether it would be more sovereign default, yesterday was the oil price collapse and the opec nonaction.You mentioned the 10 year yield under 1%. the slow growth deflation story and the complete inability of anyone to generate inflation is the story and global economy.This was nicely played up yesterday.The best piece i have read this week was isabella writing in ft l about a new note from city’s william bauder about gold, bitcoin and this swiss-gold referendums with a demand to keep 20% and not sell it and i love this line, forbidding a central bank from ever selling gold reduces the value of those gold holdings to zero which is such an insightful point.

If you have it and cannot sell it what does it do for the central bank?

Particularly for chris weiland, do we treat gold the same as we did 60 years ago or 200 years ago?

Gold is slowly inching back toward becoming a monetary asset , it is still a collectible because of the confiscation by fdr in the 1930’s, it is now collateral for slop agreements.

“Gold Is A 6,000 Year Old Bubble” – Citi’s Dutch Strategist Throws Up All Over Gold, Days After Dutch Gold Repatriation

“Gold is the world’s most persistent bubble: 6,000 years old and going strong” – Citigroup’s Willem Buiter.

Dear Willem, thank you for that valiant effort. After reading a few thousands words of shallow propaganda we understand your “confusion”: our advice, if you want to understand what gold really is, read the following from Kyle Bass: “Buying gold is just buying a put against the idiocy of the political cycle. It’s That Simple.” Because if there is a bubble that is even bigger and longer than the “6000-year-old gold bubble” it is that of human corruption, greed, and idiocy. And that doesn’t even include the stupidity of those who don’t grasp this simple truth.

Deutsche Bank’s Modest Proposal To Central Banks: “Purchase The Gold Held By Private Households”

“… the idea of gold purchases has merit because of the possible sellers. Much gold is held in private households, especially in countries like Germany. In some cases these are unwanted remnants of crisis-driven investments five years ago. A program that targeted these holdings would liberate dormant liquidity, some of which might even flow into

Here Comes France: Right-Wing Leader Marine Le Pen Demands Central Bank Repatriate French Gold

First Germany, then the Netherlands, perhaps Switzerland this weekend, and now the French right-wing Front National, which shockingly came first in May’s European parliament elections, and whose leader Marine Le Pen is currently polling in first place in a hypothetical presidential election (in both a first and run off round), ahead of president Hollande, has sent a letter to the governor of the French Central Bank, the Banque de France, demanding that France join the list of nations which have repatriated, or at least tried to, their gold.



Asian Gold Traders Suspicious Of Recent “Turbo Steroid Moves”

It will come as no surprise to regular readers that gold (and silver) have suffered from ‘odd’ violent down-slams in the last few months but, as Bloomberg reports, those ‘sneak-attacks’ have become increasingly more prevalent during the thin illiquid hours of the Asia trading session. “It is unusual for Asia to be seeing these busy trading sessions,” notes on trader, adding that “consensus seems to be that there is a big increase in algorithmic and high-frequency trading in this time zone.” The trend began on Oct. 31, with gold futures falling $11 in a minute on nearly 9,000 lots (20x the norm) – all happening when the Chinese market is at lunch. As one Hong Kong precious metals trader remarked,“someone is utilising these thin trading volumes to get a turbo steroid move.”



The Dutch central bank has secretly brought a large part of the national gold reserves being held in a secure depot in New York back to Amsterdam. In total, 120 tonnes of gold valued at €4bn has been brought back to the Netherlands by ship, Nos television said.
The high security reparations for the move took months. The central bank decided to bring some of its gold reserves back to the Netherlands to ensure a better spread, the bank said in a statement. In addition, the bank hopes to boost consumer confidence by showing there is enough gold in the Netherlands to take the country through a new economic crisis.
Now 31% of the Dutch gold reserves are in Amsterdam, the same percentage as in New York. The rest is in Ottowa and London. The Netherlands has 612 tonnes of gold – worth €19bn at current gold prices, Nos said.



Russian Gold Reserves Continue to Expand









Ukraine Admits Its Gold Is Gone: “There Is Almost No Gold Left In The Central Bank Vault”

Back in March we reported of a strange incident that took place just after the Ukraine presidential coup, namely that according to at least one source, “in a mysterious operation under the cover of night, Ukraine’s gold reserves were promptly loaded onboard an unmarked plane, which subsequently took the gold to the US.”  Needless to say there was no official confirmation of any of this taking place, and in fact our report, in which we mused if the “price of Ukraine’s liberation” was the handover of its gold to the Fed at a time when Germany was actively seeking to repatriate its own physical gold located at the bedrock of the NY Fed, led to the usual mainstream media mockery. Until now. In an interview on Ukraine TV, none other than the head of the Ukraine Central Bank made the stunning admission that “in the vaults of the central bank there is almost no gold left. There is a small amount of gold bullion left, but it’s just 1% of the gold reserves.”








China Aims For Official Gold Reserves At 8500 Tonnes


China should accumulate 8,500 tonnes in official gold reserves, more than the US, according to Song Xin, President of the China Gold Association, General Manager of the China National Gold Group Corporation and Party Secretary. He wrote this in an opinion editorial published on Sina Finance July 30, 2014. Gold is money par excellence in all circumstances and will help support the renminbi to become an international currency as “gold forms the very material basis for modern fiat currencies”, Song notes. In the short term the Chinese will not back the renminbi with gold (establish a fixed renminbi price for gold), but

The previous President of the China Gold Association (CGA), Sun Zhaoxue, was also the General Manager of the China National Gold Group Corporation, these jobs are apparently connected. Song took over from Sun as CGA President and Manager of China National Gold in February 2014. Remarkably, when Sun was in office he wrote equally candid articles (in Chinese) about the importance of gold for China’s economy. Sun’s most renowned article is titled “Building A Strong Economic And Financial Security Barrier For China”, published on August 1, 2012, in Qiushi magazine, the main academic journal of the Chinese Communist Party’s Central Committee (click here for a translated version). From Sun:


The state will need to elevate gold to an equal strategic resource.


Currently, there are more and more people recognizing that the ‘gold is useless’ story contains too many lies. Gold now suffers from a ‘smokescreen’ designed by the US, which stores 74% of global official gold reserves, to put down other currencies and maintain the US Dollar hegemony. Going to the source, the rise of the US dollar and British pound, and later the euro currency, from a single country currency to a global or regional currency was supported by their huge gold reserves.


Individual investment demand is an important component of China’s gold reserve system, we should encourage individual investment demand for gold. Practice shows that gold possession by citizens is an effective supplement to national reserves and is very important to national financial security.


Song’s vision is in line with these statements which confirms the strategy of the Communist Party of China to aggressively accumulate official gold reserves and to stimulate individual gold investment in order to strengthen the Chinese economy and protect it from internal and external shocks.

Note, Song is the President of the CGA that for political reasons largely understates Chinese gold demand figures in order to conceal China’s true hunger. Though clearly expressing his point of view in the next article, he could not disclose deviant data regarding CGA demand numbers. Actual Chinese wholesale gold demand in 2013 was 2197 tonnes, as is confirmed numerous times.

Translated by LK, gold investor from Hong Kong.


By Song Xin, General M


Gold Will Support Renminbi As It Moves To Join World

anager of the China National Gold Group Corporation, Party Secretary and President of the China Gold Association.

2014-05-06 edition 6

For China, the strategic mission of gold lies in the support of RMB internationalization, and so let China become a world economic power and make sure that the “China Dream” is realized. 

Gold is the only thing carrying the dual mantels of a commodity as well as a monetary substance. It’s both a very ‘honest’ asset and forms the very material basis for modern fiat currencies. Historically, gold has played an irreplaceable role in responses to financial crises and wars as it comes to protecting a country’s economic security. Because of this, gold carries with it an honored and divine-given strategic mission in the ascend of the Chinese people and the pursuit of the “China Dream”.


The Important Function Of Gold

Gold is the world’s only monetary asset that has no counter party risk, and is the only cross-nation, cross-language, cross-ethnicity, cross-religion and cross-culture globally recognized monetary asset. Gold is the last protection for a country’s economic security; it safeguards a nations sovereignty in times of crises. A textbook example happened in 1997 during the Asian financial crisis. To work through Korea’s severe debt problem, the IMF’s condition for a rescue package was to sell large enterprises. In the end, the Korean government had no choice but to call on its people to donate gold to settle the foreign debt, and it was only through this act that the chaebols at the center of the country’s economy and independence survived.

From our country’s point of view, gold has played an irreplaceable role in the development of our economic society. In the wars during the Revolution [1921-1937] gold provided strong support in the economic development of the liberated zones and achievements in reforms; in the three years of natural disasters, the nation used gold reserves to obtain information on living and production conditions and took actions to alleviate hardship. At the start of the great Reforms (1980’s), gold boosted our foreign reserve levels and helped the promising private sector and it advanced society. After 1989, we suffered economic sanctions from Western countries for a while and the PBOC used our gold reserves to enter into swap agreements to obtain needed foreign currencies. Right now, gold is still serving its functions to protect against economic risks; contributing in ever more important ways to our financial security. For the moment, although in general the international scene is peaceful, conflicts can develop in certain regions. If there should be a blockade or regional war, there could be only one method of payment left: gold.


The strategic Mission Of Gold

Since the 18th People Congress, general secretary Xi Jinping brought up the goal to revive our nation, to realize the “Chinese dream “. One important part of this dream is to have a strong economy. Though China is already the world’s second largest economy, there is still a long way to go to become an economic powerhouse. The most critical part to this is that we don’t have enough say in matters such as international finance and matters regarding the monetary system, the most obvious of which is the fact that the RMB hasn’t fully internationalized.

Gold is a monetary asset that transcends national sovereignty, is very powerful to settle obligations when everything else fails, hence it’s exactly the basis of a currency moving up in the international arena. When the British Pound and the USD became international currencies, their gold reserve as a share of total world gold reserves was 50% and 60% respectively; when the Euro was introduced, the combined gold reserves of the member countries was more than 10,000 tonnes, more than the US had. If the RMB wants to achieve international status, it must have popular acceptance and a stable value. To this end, other than having assurance from the issuing nation, it is very important to have enough gold as the foundation, raising the ‘gold content’ of the RMB. Therefore, to China, the meaning and mission of gold is to support the RMB to become an internationally accepted currency and make China an economic powerhouse.

In this view, our gold reserves are very low, both in terms of a nominal level as well as a percentage of official reserves. From the nominal level, the total official reserves of gold in the world stands at 30,000 tonnes, of which the USA has been occupying the first place at 8133.5 tonnes – 26 % of the world total. Germany has 3387.1 tonnes and Italy and France both hold more than 2,400 tonnes. Ours is 1054 tonnes at the sixths place – only 3.4% of the world total. As a percentage of a country’s total reserves, US gold reserves amount to 71.7 % and European nations have kept their levels between 40% to 70%. The average of the world is about 10%, but for us it’s only 1%.

That is why, in order for gold to fulfill its destined mission, we must raise our gold holdings a great deal, and do so with a solid plan. Step one should take us to the 4,000 tonnes mark, more than Germany and become number two in the world, next, we should increase step by step towards 8,500 tonnes, more than the US.


All-round, Multi-channel Increases In Gold Levels. Fulfill Our Part In Enabling Gold To Accomplish Its Strategic Mission.

How to achieve growth in our gold reserve? Apart from the PBOC directly buying in the open market, we should use also use the following strategies:

1. Relax gold import controls, grant large scale gold enterprises permits to import gold. In 2013, our gold consumption reached 1176.4 tonnes. Compared to the 426 tonnes of local production, there is a shortage of 750 tonnes. To meet this gap, we presently let the 12 commercial banks with gold-trading rights import standard gold ingots. But these banks lack the ability to refine and assay gold, they can only import standardized gold, missing the large amount of non-standardized gold and wasting the international resources that we could reach. By relaxing import controls, the large-scale gold companies can then obtain this gold and use their own technology to refine it into standard quality gold. This can help meet demand in the market, or turn gold into official reserves as required.

2. Establish a gold reserve building fund. This can be seeded using capital from the State Treasury, and open it for participation by private-sector capital in the public. It should be controlled by the State and used to target diverse off-shore gold resources, acquire mines and raw gold and in so doing, extend our reach beyond our borders and add a layer of opaque reserves to otherwise standard reserve numbers.

3. Establish a Gold bank. We need to establish our gold bank as soon as possible, and enable it to break the barrier between the commodity and monetary world. It can further help us acquire reserves and give us more say and control in the gold market. It may be guided under the PBOC and led by the China Gold Association, involving leading gold industry companies and commercial banks, and it’s business would include: gold pricing (fix), gold financing and leasing, gold-guaranteed payments, gold saving accounts, gold lending, gold production chain financing and issuance and trading of paper gold and other gold investments. This gold bank can then naturally use market-oriented methods to change commodity gold into monetary gold reserves, thus help us increase our strategic gold reserves.






BRE-X: Inside The $6 Billion Gold Fraud That Shocked The Mining Industry

bre-xMasterMindsMichael de Guzman

In 1993, a prospector namedMichael de Guzman walked out of the jungles of Borneo with extraordinary news: he found gold.

This is according to MasterMinds, a Canadian true crime documentary television series produced by truTV.

For the next three years, de Guzman produced thousands of core samples riddled with gold. Canada’s CBC News has a detailed timeline of the events.

Where Is Swiss Gold? – Location, Location, Location

With the Swiss gold stored at the Bank of Canada, now having been transferred out of the Bank of Canada’s Ottawa vault to an unknown location, the Swiss public would be wise to question the SNB on this move. The Swiss gold stored at the Bank of England in London seemingly being ‘actively managed’ one of the world’s largest centres for unallocated gold trading, the Swiss public would also be wise to enquire on this issue. And with significant historical quantities of Swiss gold that were stored with the US Federal Reserve Bank in New York no longer there after the SNB seemingly brought their US vaulted gold holdings to zero, the Swiss public need to question why these particular holdings were targeted for sales from 2000-2005 and not domestically held gold.

China, Russia Sign CNY150 Billion Local-Currency Swap As Plunging Oil Prices Sting Putin

While Russia’s economy is hurting, desperate to overthrow the tentacles of the Petrodollar, and is urgently pivoting toward Beijing, the cherry on top came moments ago when, as if to assure all involved parties that there will be enough capital support on both sides, the PBOC released a surprising announcement that the central banks of China and Russia signed a 3-year, 150 billion yuan bilateral local-currency swap deal today, according to a statement posted on PBOC website. Deal can be expanded if both parties agree, statement says. Deal aims to make bilateral trade and direct investment more    convenient and promote economic development in 2 nations.








With 50 Tonnes Of Gold Smuggled In 10 Days, India’s Physical Gold Premiums Set To Double

As the price of precious metals that is eschewed daily by status-quo-hugging talking-heads on business media as indicative of the days of hard money being over continues to come under ‘pressure’, demand for physical gold remains extremely high. With India’s festive season about to begin, The Hindustan Times reports amassive surge in gold smuggling in the last 10 days as heavy demand for gold during Dussehra (for which booking and supply starts today when Navratri begins) has dragged 50 tonnes of gold across the borders to avoid the government’s capital controls.


Fed’s Fisher Admits “Fed Has Levitated Markets”, Warns Of “Signs Of Excess”

FOMC voting-member Richard Fisher is among the sanest voices in the Eccles Building asylum and he is once again sounding alarms that all is not well in US financial markets:


Furthermore, Fisher notes The Fed can’t force companies to hire, and would like to see rate hikes as early as Spring 2015.





“I Still Believe In Gold” – Ron Paul

Dr Ron Paul, the popular Presidential candidate in America and the world’s most popular libertarian voice, told CNBC yesterday that he “still believes in gold” and that “gold could go to infinity.”

Former U.S. Representative Dr Ron Paul told CNBC’s Jackie DeAngelis and the Futures Now Traders that the long-term case for gold remains firmly intact.

Dr Ron Paul:

“Timing is the only thing. I remember watching gold when it was 35 dollars an ounce and we thought if it ever hit a hundred dollars, the world would come to an end. And then a thousand dollars, so; no, it’s good as long as we continues to do this <print money> , you know, it could go to infinity because when people just leave the dollar, who knows what …”

“But that won’t happen if we finally wake up and do something.  But if we can keep this together, if the money managers can keep it together and it doesn’t collapse, yes, gold is gonna keep creeping up, but, you know, as weak as gold looks right now, it’s up a hundred dollars for this year so…”
Jackie DeAngelis:
“It’s roughly I think up 8% year-to-date. It’s not a horrible move for gold but I think a lot of people were expecting to see a little bit more, especially with the instability that we’re seeing in terms of the geopolitical situation. A lot of conflict around the world — you’d expect gold to be higher right now.”
Ron Paul:

“Yeah, but if you understand the subjective theory of value, you don’t get too concerned about that because, yes, increasing the money supply weakens the dollar and a weaker dollar raises the price of gold and it’s a long term measurement. But you can’t measure, you can’t say that the money supply went up a certain amount, and gold is going to go up, so there’s a subjective element in that.”

“But long term…and economic law says, if you keep printing a lot of paper money, the value of that dollar and currency will go down, and things and most prices will go up and indeed gold always goes up against that currency.”

But you don’t, I don’t get in the business of saying in a year or two or three it’s going to be two or three or four thousand dollars because it really challenges the basic fundamental beliefs of the Austrian school, to make these kinds of predictions.”

The interview about gold can be watched here

In another interview with CNBC, Dr Paul reaffirmed his view that the nation’s monetary and fiscal policies would result in massive inflation. He warned of a stock market crash and of the risk that currency debasement will lead to the continuing devaluation of the dollar.

Ron Paul has long said America should “end the Fed,” and he made that case once again on Tuesday.

“One thing you have to do is get rid of the Fed, because of the Fed “spin” that leads to volatility in markets. Referring to the statements and spin by Federal Reserve governors, now Janet Yellen, he said that in fact  it is a “very inefficient way to operate a market, to have one individual make one statement, and put so much weight on it.”

“In short term, it’s very, very real, because people are going to make it or break it, you know, on this interpretation. But that has nothing to do with the free market, nothing to do with building capitalism, and savings, and the things necessary to have a growing economy.”



This is quite a simple strategy for the government to implement since the four big Chinese commercial banks and many other Chinese banks are state-controlled.

Gold is now used widely in the banking sector in structured products, as gold collateral, and in gold leasing. The presence of the Chinese bullion banks in the market via the Shanghai Gold Exchange (SGE) provides the necessary liquidity that is turning the Exchange into a world player on the global gold market. 


The China Gold Congress is currently in full flight in Beijing. The three day Congress is China’s biggest gold industry event of the year, drawing in participants from across the Chinese and international gold sectors including central banks, mining companies, bullion banks and refiners.

The event, co-sponsored by the World Gold Council (WGC) and the China Gold Association, showcases China’s gold industry and acts as a focus point for what is now the world’s largest gold market in terms of demand and product innovation.

Discussions and forums during the event cover everything from reserve asset management for the official or central banking sector, through to investment products and mining supply. One of the key themes this year is the internationalisation of the gold market.

China’s gold market accounts for one third of global demand, and according to the WGC, is expected to grow another 20% cumulatively from now until the end of 2017.

In what is still a very centrally planned economy despite many market related reforms, nearly all reported gold activities in China flow through the Shanghai Gold Exchange (SGE) in one form or another.

Both the China Gold Association and the Shanghai Gold Exchange were established with government backing and their growth and success reflect a very deliberate pro-gold strategy on the part of the Chinese Government.






Silver (And Gold) Are Breaking Out Again

Despite the utter deluge of “this won’t last” explanations of why yesterday’s surge in gold and silver is transitory (and nothing to worry about), the sell-side is staring agog this morning as the precious metals markets are breaking out to new cycle highs. While the CCFD unwinds appear the clearest driver, Yellen’s aggressive inflationist bias, and unintended consequence of increasing supply destruction (as prices were manipulated below production costs) appear to be trumping any short-covering, opex-related reasons for the push higher.










It is hard to miss the price capping and manipulation on the metals market at the Comex, unless one does willfully so. And there are certainly those who do, and I suspect you know who they are.

There was little action on the metals front last Friday as the clearing and warehouse reports below demonstrate. The action has shifted to the East.

I expect the markets to unravel their story about the future somewhat slowly over the summer. This goes for stocks, bonds and commodities. We are seeing a great reckoning between reality and the will to power.

If anyone is near to a fiduciary responsibility for the obligations for gold and silver bullion delivery, or even large positions of naked shorts in stocks, and they do not personally have title and possession of the metal or the equities, I would probably suggest that they get out or start lawyering up now, with a well thought out Plan B involving offshore accounts and domiciles.  You can always try for a Presidential pardon later on.   I suspect it will become the fashionable thing to do.

If this convoluted system of asset rehypothecation starts breaking bad it is going to make MF Global look like a church picnic.  ‘Everyone was doing it’ is not an unassailable defense, and ‘I had no idea what was going on” only works for those with very lofty connections and office.



Gold Price Manipulation Was “Routine”, FT Reports

Two weeks ago when news broke about the first confirmed instance of gold price manipulation (because despite all the “skeptics” claims to the contrary, namely that every other asset class may be routinely manipulated but not gold, never gold, it turned out that yes gold too was rigged) we said that this is merely the first of many comparable (as well as vastly different) instances of gold manipulation presented to the public. Today, via the FT, we get just a hint of what is coming down the pipeline with “Trading to influence gold price fix was ‘routine’.” We approve of the editorial oversight to pick the word “influence” over “manipulate” – it sound so much more… clinical.






“Massive Shortages” In Gold Coming and “Typical Investor” Will Not Be Able To Get Bullion – Rickards

Financial expert, Pentagon insider and bestselling author James Rickards has warned that “typical investors” may not be able to acquire physical gold when prices begin to surge hundreds of dollars a day as “massive shortages” will take place.

In another fascinating interview, this time with the always worth a watch Greg Hunter, formerly of ABC and CNN and now of USA Watchdog, Rickards said that gold will become the preserve of the “big guy” in the form of sovereign wealth funds and central banks.

This is something we have warned of since 2003. There is another risk in the form of ultra high net worth individuals (UHNWIs) in Russia, China and elsewhere also attempting to corner the physical gold and silver markets.

In the 1970’s, the Hunt Brothers made the mistake of not accumulating enough physical silver outside the reach of the U.S. authorities. Some billionaires today will likely not make the same mistake.

Rickards latest book, ‘The Death of Money’ predicts “the coming collapse of the international monetary system” and is being very well received. In recent days alone, Rickards has conducted a huge amount of media interviews with most leading financial networks.  

One of the signposts of the coming collapse of the international monetary system is countries like Russia declaring it will no longer use the U.S. Dollar as a reserve currency in international trade.

Rickards explains, “Putin said he envisions a Eurasian economic zone involving Eastern Europe, central Asia and Russia.  The Russian Ruble is nowhere near ready to be a global reserve currency, but it could be a regional reserve currency.”


Rickards is surprised at how fast the economic situation is unfolding.  Rickards says, “If you ask me what has happened since you finished writing the book that comes as a surprise, I would say a lot of the things I talk about in my book are happening faster than I would have expected. Things that I thought would happen in the 2015 or 2016 time frame seems to be happening now in some ways.  If anything, the tempo of events is faster than expected. “

“Therefore, some of these catastrophic outcomes may come sooner than I wrote about.”

Rickards told Hunter that “right now, we are on the precipice now”.

“When you are on the precipice, it doesn’t mean you fall off immediately, but you are going to fall off because you can see the forces in play.  What I tell clients and investors is it’s not as if we are going to make some mistakes and some bad things are going to happen.  The mistakes have already been made.  The instability is already in the system.  We’re just waiting for that catalyst that I call the snowflake that starts the avalanche.   You don’t worry about the snowflakes; you worry about the snow and that it’s unstable and it’s just waiting to collapse.  That’s what the system is right now; we are just waiting for a catalyst.  People ask me all the time, what could it be?  Technically, my answer is it doesn’t matter because it will be something.  It could be a failure to deliver physical gold.  It could be an MF Global financial failure.  It could be a natural disaster.  It could be a lot of things.  The thing investors need to understand is the catalyst doesn’t matter.  It’s coming because the instability is already there.”

On gold manipulation and when it will end, Rickards says, “It will end when the physical shortage gets to the point that someone fails to deliver; which, at that point, there will be a buying panic.  There could be a buying panic or what some people call a demand shock.  One of the things I said about gold manipulation is if I was the manipulator, I would be embarrassed at this point.  The manipulation is obvious.  The evidence is coming in from all directions. . . . The manipulation is clear.  When will it end?  It will end when there is a physical shortage that pops up somewhere, or it will end with a short squeeze.”

“We are going to get a very large demand shock coming from China and India”, said Rickards.

“Let me explain those two cases.  We have a brand new government in India, and they are going to repeal the import tax on gold.  We also have the wedding season coming up. . . . So, India is set up for a very large surge in demand in the fourth quarter.  Now, over to China, this is one of the things that it’s happening faster than I originally thought.  The credit collapse story is happening in real time.  I said (in my book) this might be a 2015 event, but it looks like it is happening now.  Defaults are piling up.  We are seeing money rise.  We’re seeing people march down to the banks . . . trying to get their money back. . . . So, if they can’t buy foreign stocks, domestic stocks, don’t want to put their money in the bank and are getting out of real estate, then what’s left?  The answer is gold. . . . I see a demand shock coming from China. . . . You could see a scramble to buy gold.  It is going on anyway, but you could see it accelerate.  That will take down the manipulation.  Once the markets prevail over the manipulators, then watch out.”

Rickards, Washington and Wall Street insider, is certain the collapse will happen. He is just not sure when it will happen.

“It is the thing you won’t see coming that will take the system down.  Things happen much more quickly than what investors expect.”

“What will happen in gold is that it will chug along and then all of a sudden–boom.  It will be up $100 an ounce, and then the next day it will be up another $200 an ounce.  Then everyone will be on TV saying it’s a bubble—boom.  It’s up $300 an ounce, and before you know it, it will be up $1,000 per ounce.”

“Then people will say gee, I better get some gold, and they’ll find out they can’t get it because the big guy will get it.  You know, like central banks and sovereign wealth funds will be able to get the gold.  The typical investor will run down to the coin shop and they will be sold out, and the U.S. Mint will say sorry, we’re not shipping.”  

“You’re going to find out you can’t get it because the whole thing is set up for massive shortages in supply.”


As Russia Dumps A Record Amount Of US Treasurys, Here Is What It Is Buying

Last week we commented that based on TIC data, while “Belgium’s” unprecedented Treasury buying spree continues, one country has been dumping US bonds at an unprecedented rate, and in March alone Russia sold a record $26 billion, or 20% of its holdings. So as Russia is selling a record amount of US paper, what is it buying? For the answer we go to Goldcore which tells us that “Russia Buys 900,000 Ounces Of Gold Worth $1.17 Billion In April.”








Barclays’ Head Of Gold Trading, And Gold “Fixer”, Is Leaving The Bank

Last week, for the first time ever, in “From Rothschild To Koch Industries: Meet The People Who “Fix” The Price Of Gold” Zero Hedge shone a spotlight on the mysterious, and “without any permanent employees” company known as The London Gold Market Fixing Limited which for 117 years has served as the corporate face of the London bankers who “fix” the price of gold twice daily. Since then, more than one of the LinkedIn pages we profiled of the bankers among the 5 gold fixing banks has quietly been taken down. However, the biggest surprise took place moments ago when none other than the head of spot gold trading at Barclays, Marc Booker, did what so many heads of spot FX trading in the past few months have done over fears of being caught in the ongoing manipulation probe: he exited stage left from Barclays HQ at One Chruchill Place.




The Beginning Of The End Of Precious Metals Manipulation: The London Silver Fix Is Officially Dead

Q. What will happen after 14 August 2014? Will the Silver Fixing cease to exist?

A. With effect from the close of business on 14 August 2014, the Company will cease to administer a Silver Fixing, and a daily Silver Fixing Price will no longer be published by the Company.




Silver Fixing Company to Stop Running London Benchmark

Photographer: Alessia Pierdomenico/Bloomberg

Small silver grains are seen in a holding vat after the washing process at the a…Read More

The company that runs the London silver fixing, a benchmark dating back more than a century, will stop running the process after Deutsche Bank AG said two weeks ago that it was dropping out of the price-setting ritual.

The London Silver Market Fixing Ltd. will stop administering the fixing on Aug. 14, it said today in a statement. Until then, Deutsche Bank, HSBC Holdings Plc and Bank of Nova Scotia will remain the three members of the company, which will liaise with the U.K. Financial Conduct Authority. Alternatives may be available. The London Bullion Market Association started a consultation and will work with the market, regulators and potential administrators.

Regulators have been stepping up their scrutiny of how gold and silver prices are set in the wake of the London interbank offered rate-manipulation scandal. The FCA is visiting member banks involved in the gold fixing as part of its review of gold benchmarks, a person with knowledge of the matter said last month. The watchdog hasn’t leveled any accusations that the process is being manipulated. Deutsche Bank has said it is leaving fixings as it scales back its commodities business.

“I suspect that something will be developed that will enable an auction price to be achieved during the working day, taking the place of the fix and that will enable people to derive a benchmark figure, which is what the market needs,” Ross Norman, the chief executive officer of London physical broker Sharps Pixley Ltd., said today by phone. “It’s essential for the market. It is the only objective price.”

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Live 24 hours gold chart [Kitco Inc.]

How China Imported A Record $70 Billion In Physical Gold Without Sending The Price Of Gold Soaring





I hate to be the bearer of bad news, Switzerland, but what you suspected all along is actually true. Your gold is gone. All of it. Leased and sold away by your central bankers and politicians.

suisse-marche-or gold

To the good people of Switzerland: You have been scammed and sold down the river. Your politicians and bankers, in a pathetic attempt to consolidate power and curry favor with the EU, have given away your independence and your historic sovereignty. You should be angry. The initiative you have taken and the referendum you have planned are all well and good. I applaud you for taking these steps within the context of Swiss law and tradition. However, you must understand what is truly at stake and if you don’t take more powerful and forceful acts soon, the likelihood of you ever regaining your birthright as an independent, sovereign nation is slim.

Click link to read full story

You, Switzerland, still have time to act and prepare but you must move quickly. The possibility exists for you to reverse course and demand change but time is short. The end of the great Keynesian experiment is upon us. Reclaim your gold and your sovereignty now or be forever consigned to the trash heap of fiat currency history.








And Then There’s This: “The Oceans Will Rise; Nuclear Winter Will Be Upon Us; And The World As We Know It Will End”

Submitted by Tyler Durden on 05/01/2014 

As U.S. Justice Department prosecutors begin to bring the first criminal charges against global banks since the financial crisis, they are facing dire warnings of uncontainable collateral damage from none other than the sell-side’s banking analysts… “Don’t play with matches,” warned Brad Hintz, bringing up the specter of Enron (somehow suggesting we would better if that had not been prosecuted?) “The mere threat of requiring a hearing could cause customers to lose confidence in the institution and could cause a run on the bank,” warns a banking lawyer (well isn’t that how it’s supposed to be?). Too Big To Prosecute is starting to tarnish a little as Preet Bharara begins to bring the heat, adding, somewhat humorously that, banks have a “powerful incentive to make prosecutors believe that death or dire consequences await.”


Gold Fix Manipulation Crackdown: Deutsche Officially Resigns London Fix Seat

Submitted by Tyler Durden on 04/29/2014  Three months ago, we discussed the increasingly close eye that regulators were keeping on Deutsche Bank (and in fact many other precious metal fix providers) as manipulation concerns shifted from conspiracy theory to conspiracy fact. At the time, Deutsche – among other banks – had suggested it would relinquish its role on the London Fixing committee and was actively marketing its seat to other LBMA members – it failed to find a willing buyer; the WSJ now confirms… DEUTSCHE BANK SAID TO BE UNABLE TO FIND BUYER FOR GOLD SEAT DEUTSCHE BANK RESIGNS SEAT ON GOLD, SILVER FIX, GIVES TWO WEEKS NOTICE – SOURCE This is hardly surprising given previous comments that possible manipulation of precious metals “is worse than the Libor-rigging scandal.” but it does leave us wondering who is left to do the manipulating? It seems no one wants to be part of the fixing process (critical for so many derivatives contracts) unless they are allowed to manipulate it to their own needs.

The Political Poison of Vested Interests

Submitted by Tyler Durden on 04/22/2014  Combine diminishing returns with the political dominance of vested interests and you get a system incapable of reforming itself and incapable of stopping the slide off the cliff. Vested interests have no concern for the unintended consequences of their self-aggrandizement; the entire poilitical structure is based on the faith that there is always more money to feed the insatiable hunger of entrenched interests for more funding, more protection and more power. And so the only possible “solution” left is collapse.  

Breakingviews: How long can China Internet ‘gold rush’ last?

April 2 – China’s U.S.-listed Internet firms are in a fund-raising frenzy, with bonds offering investors another way into the sector. But Breakingviews’ Peter Thal Larsen wonders if now is the time to buy.


MICHAEL LEWIS: The Stock Market Is Rigged




March , 2014 update China is now the No. 1 producer, No. 1 consumer, and No. 1 importer of gold – but it’s what they plan to do with all of this gold that should have Americans concerned. Gold prices are up nearly 10% since the start of the year, but analysts say that a much more powerful catalyst is about to emerge: China. It’s official. According to data released last month, China is now:

  1. The No. 1 producer of gold in the world, mining a record 437 tons in 2013 – 150 tons more than second-place Australia.
  2. The No. 1 consumer of gold in the world, surpassing India for the first time ever as already soaring Chinese gold demand rose another 32 percent in 2013.
  3. The No. 1 importer of gold in the world, vacuuming up a record 1,158 tons through Hong Kong, which publishes gold trade staticstics kept secret in mainland China.

And… keep in mind, these are the “official” numbers. Some experts believe the actual numbers are in fact, much, much bigger. China does not report gold imports through Shanghai or other metals exchanges. International banking expert and bestselling author James Rickards was asked about China’s gold accumulation and said, “I have spoken to a number of sources in Asia. Every time I have an estimate and try to verify it, what I get back is that I’m wrong on the low side.” Where is all of this going – and what does it all mean? Matt Badiali is a gold and natural resources expert at Stansberry & Associates Investment Research. He says a huge gold stockpile could be a strategic asset for China, which is seeking to internationalize its currency. According to Badiali, China wants its currency to be more important in international trade – so that trade partners don’t have to use dollars in international payments. A large Chinese gold reserve would speed up that process by making the Chinese Yuan a credible “reserve currency” – possibly even one freely convertible to gold, as the dollar was for over a century. Of course, China has kept these maneuvers secret. “China’s undeclared official gold reserve purchases remains an elephant in the room in the gold market with very little coverage of or analysis of the People’s Bank of China’s quiet and nontransparent accumulation of gold,” Business Insider reported. But Badiali says he expects the Chinese government to make a huge announcement as early as April 24th of this year, which could send shock-waves through the financial markets, and could send the price of gold soaring.    * NOTE..this is a reprint from below deeper in this column….and you will benefit  and add value to your knowledge to continue reading until you read this again below…… For anyone looking to hold gold as a store of value or even medium of exchange,  major gold coin mintage’s like the Eagle, Maple Leaf, and Krugerrand are advantageous because they’re recognizable worldwide. You can do business in a coin shop anywhere in the world from Vancouver to Vanuatu with one of these coins; bulk bullion, on the other hand, needs to be specially weighed and assayed by experts before being traded. For this reason, the premiums for which gold coins sell tend to rise substantially in crisis periods when demand for physical metal is high. In the initial days of the 2008 financial crisis, premiums shot up from 4% to well over 10%, even though the price of gold was simultaneously falling sharply. Today, with gold routinely taking out its all-time highs, gold coin premiums around the world have remained fairly high– this is one of the things that we typically look at here at Sovereign Man as we constantly travel the globe… and why what I’m about to tell you might have you falling out of your chair: One of our Asia partners, was in Hong Kong last week, and he conducted his normal rounds of the various banks in the Central business district that sell gold bullion coins over the counter to walk-in customers such as Hang Seng Bank, Bank of China, and Wing Lung Bank. At Hang Seng Bank, Canadian 1 Oz Maple Leaf coins — in pure, 24 karat gold — were available for cash purchase in Hong Kong dollars at just 0.5% above the prevailing spot price of gold. This is dirt-cheap… or as they say in Chile, ‘precio de huevos’, and it certainly presents an interesting arbitrage opportunity. Depending on your objectives, however, there may be even better gold coin buys in Hong Kong at the moment. Over at the Bank of China, for example, the Chinese Panda coins were quoted at 4.9% above spot gold. Personally, I think the Panda is one of the most beautiful gold coins of all, and in North America they typically sell for much greater mark-ups above the spot price of gold than most other coins, often over 20%. In the UK it’s even more. Many collectors value the Pandas simply for their aesthetic beauty; and it probably doesn’t hurt that the dealers authorized by the People’s Bank of China to sell Pandas in the US have a virtual monopoly on the market. Still, this situation can be exploited to your advantage– the difference between the buy price in Hong Kong and the sell price in North America is roughly $275 per 1-ounce coin.

Former Central Banker Admits “[They] Are Making It Up As They Go Along”

A few weeks ago, William White (former economist at the Bank of England, the Bank of Canada, and Bank of International Settlements) made a frank admission: “The analytical underpinnings of what we [mainstream economists] do are actually pretty shaky…I’m becoming more and more convinced that all of the models we use are basically useless… We’ve got the potential to do so much harm by not getting the creation of fiat credit and money right.” Doctors at least have the Hippocratic Oath: first, do no harm. If only economists and central bankers had a similar ethic. But they don’t. So they continue ‘making it up as they go along’, as Mr. White suggests, applying failed ideas with impunity and continued authority to an unquestioning public.


Submitted by Tyler Durden on 03/22/2014  Curious how China imported a record amount of physical gold in 2013 without in the process sending the price of gold to new record highs? Here is the answer…{ click link for full story )  …….. >  [ excerpt ] > This brings us to the speculative conclusion of this article: when we previously contemplated what the end of funding deals (which the PBOC and the China Politburo seems rather set on) may mean for the price of other commodities, we agreed with Goldman that it would be certainly negative. And yet in the case of gold, it just may be that even if China were to dump its physical to some willing 3rd party buyer, its inevitable cover of futures “hedges”, i.e. buying gold in the paper market, may not only offset the physical selling, but send the price of gold back to levels seen at the end of 2012 when gold CCFDs really took off in earnest.   In other words, from a purely mechanistical standpoint, the unwind of China’s shadow banking system, while negative for all non-precious metals-based commodities, may be just the gift that all those patient gold (and silver) investors have been waiting for.  This of course, excludes the impact of what the bursting of the Chinese credit bubble would do to faith in the globalized, debt-driven status quo. Add that into the picture, and into the future demand for gold, and suddenly things get really exciting.    

The world is SCREAMING for a new financial system

March 14, 2014 Ambergris Caye, Belize One of the key lessons we can take away from history is that the global financial system changes… frequently. In ancient times, Roman coins were used across the region by Romans and non-Romans alike who engaged in trade and commerce. Given how destructively successive Roman governments debased their coins, however, the reserve burden eventually fell to the Byzantine Empire, whose gold solidus coin became the dominant currency in world trade. Over the centuries, this standard changed several more times. The Venetians, Florentines, Spanish, French, British, etc. each issued the world’s dominant currency at one point or another. But the fundamentals of those currencies changed. Governments engaged in wanton debasement, mismanaged their economies, and accumulated massive debt levels. And eventually the world shifted to new currencies. Since the end of World War II, the US dollar has been the dominant currency in the world. And even though Richard Nixon ended the dollar’s convertibility to gold and unilaterally abandoned the US government’s obligations under the Bretton Woods system back in 1971, the world has still clung to the dollar for the past 43-years. But this is changing rapidly. The Chinese, which have their own economic issues to deal with, are starting to dump Treasuries in record numbers. Central banks are buying up more gold. Foreign countries are entering into bilateral currency swap arrangements with one another. And world governments are starting to (rather embarrassingly) demand that the US get its budget and fiscal house in order. Most tellingly, though, member nations of the International Monetary Fund are starting to revolt. As one of the major organizations spawned from the post-war financial structure, the IMF’s original goal was to ensure the smooth development of a new global financial system. Over 180 countries have since become members of the IMF. But the organization runs on a quota system, with each member nation having a certain percentage of the IMF’s overall votes. The US, for example, has the most power by far with a 16.75% share of the vote. Japan is a distant second with a 6.23% share. This puts the US in the driver’s seat. And it’s been that way for decades. But most of the other 180+ nations have had enough. And they’re pushing the United States to massively overhaul the current quota system. Even typical allies are breaking ranks. Australian Treasurer Joe Hockey recently told reporters at a financial conference that they will “actively lobby” the US to reform the IMF quota issues, and that “Congress must understand that it is in the interest of the US to reform the IMF. . .” India. China. Just about everyone imaginable is pushing for major IMF reform. Everyone except the Land of the Free. The US government seems to like things the way they are. And Congress has been very intransigent in adopting any planned reforms. These people have their heads buried in the sand so deep that they can’t even hear the rest of the world SCREAMING for a new financial system. This is going to happen, whether the US wants it to or not. And while no foreign government wants a collapse of the dollar, they do very much want an orderly rebalancing of the financial system. This is already under way. The US government may pretend that everything is fine and dandy. But given the overwhelming objective evidence out there, folks who aren’t on board with this major trend are ignoring it at their own peril.
Simon Black is an international investor, entrepreneur, permanent traveler, free man, and founder of Sovereign Man. His free daily e-letter and crash course is about using the experiences from his life and travels to help you achieve more freedom.

Gold Soars To Fresh 6-Month High While Risk Off Accelerates

Submitted  03/14/2014 Gold was gently levitating once again overnight but in the last few hours both gold and silver have taken off (with the latter breaking through pre-Putin levels) and the former breaking above $1385. Equity prices are tumbling from solidly green levels overnight – tracking EURJPY all the way lower – and Treasury bonds are well bid (-3bps today) with 10Y yields down 17bps on the week.         Nearly four thousand years ago, King Hammurabi of Babylon laid out his eponymous “Hammurabi’s Code”, a series of laws that is still famous to this day. Most people know Hammurabi’s Code as “an eye for an eye, a tooth for a tooth”. Yet what few realize is that the code was actually one of the original attempts at government wage and price controls.  20140313_obama_0 hammerabi Imagine a case in which markets offer very profitable opportunities to wealthy and well-connected participants. Let’s call them insiders. And let’s assume that the government does little in the way of effective regulation, except for the occasional small fry or relative outsider who is caught breaking the rules. Imagine that the insiders either directly or indirectly control the rule based governance of the exchanges, which are often supposed to be self-regulating in those areas in which the government is not able to exert the rule of law. What is there to limit the ability of those insiders to set prices where they wish for their own benefit, in terms of real world consequences such as being required to actually deliver something which they have sold, or pay a serious and personal penalty when they are caught rigging the game and breaking the rules. In such a case, one has to ask themselves, what is there to keep this market from just degenerating into a killing field, a type of control fraud, where those in the real economy who dare to venture in, either willingly or without recourse, are led into a blind alley and robbed, and sometimes economically strangled?  And what are the likely longer term consequences, in the real world of people who work and produce things, of such a corrupt and inefficient arrangement? Some might suggest the decimation of certain industries and economic sectors, eventual systemic shortages, significant inequality of power and wealth, and a straining of the social fabric. Who could even imagine people allowing such a dreadful state of affairs to exist, especially in a land of the free? “There are more things in heaven and earth, Horatio, than are dreamt of in your philosophy.”

Who Gets Thrown Under The Bus In The Next Financial Crisis?

Submitted  on 03/3/14

The speculative excesses and political power of Wall Street pose a strategic threat to the Deep State, and as a result a showdown between the Deep State and the surface machinery of governance that has been captured by Wall Street is looming. Put another way: we’ve reached Peak Wall Street and it’s all downhill from here. This crisis is simple to summarize: the paper claims on wealth so far exceed actual wealth that something’s gotta give. Simply put, the vast majority of these claims will have to be zeroed out, i.e. these phantom-claim “assets” will be voided and declared worthless. This leads to the key question: who will the Deep State throw under the bus to preserve itself and the nation-state?





Gold Price “Manipulated For A Decade”, Repeatedly Slammed Lower, Bloomberg Reports

Submitted  02/28/2014 –

While the FT promptly retracted an article on precisely the topic of gold manipulation from earlier this week (recorded for posterity here), Bloomberg appears to not have had the same “editorial” concerns and pressures, and today released an article once again slamming the final conspiracy theory that while every other asset class is manipulated, gold is in a pristine class of its own, untouched by close-banging, price fixing traders or central bankers, and reports that “the London gold fix, the benchmark used by miners, jewelers and central banks to value the metal, may have been manipulated for a decade by the banks setting it, researchers say.” And the punchline: “Large price moves during the afternoon call were also overwhelmingly in the same direction: down. On days when the authors identified large price moves during the fix, they were downwards at least two-thirds of the time in six different years between 2004 and 2013. In 2010, large moves during the fix were negative 92 percent of the time, the authors found.”


       FEBRUARY 17th…..2014

A sinister picture being drawn that involves global criminal activity in the financial world the likes of which is almost without precedent.


February 5,2014 Gold is moving from West to East, of this there is little doubt. Well, some can doubt it, but those who repeatedly deny it, or tend to dismiss it, may be saying more about themselves than they do about the market. The more interesting question is what the markets are saying to us, and what the price, demand, and supply action are indicating with regard to the future, and the sustainability of certain noticeable trends. JPM seems to have the whip hand on the Comex and in the precious metals derivatives markets, but not so much in the physical markets which seem to be wiggling through the fingers of the bullion banks, and perhaps much to their dismay.   As Ted Butler noted in his weekly review on Saturday:

“Quite literally, what JPMorgan does or doesn’t do determines the price of gold and silver. It’s easy to lose track of the big picture when one focuses on all the details. But when you step back a bit, JPMorgan is dominant in just about every detail.”


Renewed Calls From China For a Global Super-Currency To Replace “Bretton Woods II”

They are talking about a ‘super-currency’ for international trade, and not to replace any currencies for domestic use. I have been reporting on this for quite a few years. It is a movement whose time has come as the US dollar reserve currency falters, and the Fed expands the monetary base for domestic concerns.   You can click on either of the subject headings at the bottom of this blog entry, and all of the past postings with those subjects will be selected for your reading. The major countries will no longer tolerate the monetary manipulation with the global currency in the same unilateral manner with which Nixon changed the Bretton Woods agreement back in 1971 by ending dollar convertibility to gold, rather than devaluing against it. For lack of a better alternative or term, I settled on the SDR, made up of a new basket of currencies and commodities, almost certainly including gold, and quite possible silver, if China, Russia, et al. have their way. Right now the nations are in the ‘negotiation stage,’ with the Anglo-American banking cartel putting up a strong resistance for any changes to their ‘exorbitant privilege.’  I would not be surprised to see more forex and precious metal games played as the Lords of Finance flex their monetary muscles. And then there is the question of the tangled web of rehypothecation of bullion without public disclosure.  It could prove to be very embarrassing to some.

But change is coming, one way or another.


Something Ominous May Be Coming At Us

Earlier this week 30-day/4-wk T-Bills were auctioned off a 0% rate.  Intra-day, after the auction, the rate went negative.  Negative short term rates were last observed in 2008, before the Lehman/AIG/Goldman collapse occurred.  Of course, Lehman was allowed to implode and Goldman, who’s ex-CEO was the Treasury Secretary, was bailed out.  AIG was the beneficiary of that bailout because Goldman had impaled itself on AIG nuclear waste. The point here is that negative T-bill rates only occur when very big investors are concerned about the return OF their money and not the return on their money.   Think about what a negative T-bill rate means.  It means that someone is paying more for the T-bill than they get in return when it matures a few weeks later.  Why would someone do that?  It’s the “safest” place to park large sums of cash. A big institutional fund or very wealthy investor pays for a T-bill because they they see something which indicates that the risk of the Government defaulting in the next four weeks is less than the risk of  parking that money in a bank or a money market fund.  We’re talking millions and tens of millions in short term money.  Bank deposits are insured only up to a small amount.  After 2008, it has been decided that money market funds will no longer be bailed out by the Government/Fed. In other words, big big investors with cash that needs to be parked are seeing something that gives them concern about the financial system.  The negative rates on T-bills means that whatever was spooking big money in 2008 is spooking it again.  My best guess right now is that there is massive risk of derivatives default.  This would be the derivatives that blew up the system in 2008 but that the Fed/Government quickly monetized.  The problem was never fixed, contrary to Obama’s recent end zone dance on the safety of the banking system. In fact, the Fed swallowed a portion of the bad derivatives and has been using the better part of the $85+ billion per month it’s been printing since early 2009 to monetize the rest.  In other words the catastrophic problems were kicked down the road.  Worse, the big banks went out and replaced the crap the Fed took off their balance sheets with even more crap.  Accounting rules were changed, and ratified by BOTH political parties plus Obama, which enabled the big banks to hide the problem. But now the financial system is wearing the Scarlet Letter of negative T-bill rates.  The source that is lighting the fuse is emerging market problems, reflected in the currency devaluations by Argentina and Venezuela.  But the currencies of other important emerging market economies have been plunging against the dollar as well.  The cost of derivatives “insurance” on the sovereign debt of these countries has suddenly increased at a rate that would make Obamacare insurance providers blush.  What the currency plunge/derivatives blow-out implies is that sovereign bond defaults are on the horizon.  This is not just confined to “emerging” economic countries.  Spain, Portugal, Italy and France are on the ropes financially and economically as well, despite the official European story-line that Europe is in “recovery.” The issue for the U.S. here is that the Too Big To Fail banks are the ones who have underwritten most of the credit insurance derivatives associated with the sovereign debt that may be at risk to default.  They also hold a lot of it on their balance sheet.  That’s why the Fed’s Excess Reserve accounts of the big banks have ballooned up in correlation with amount of QE that has been printed.  The Fed has monetizing the derivatives exposure but that works only up to the point of a default event. In other words, a big nuclear derivatives may be coming at our system.  Another interesting tidbit to think about.  While the paper price of gold was being plunged using Comex futures by the Fed-backed big banks, a major portion of the gold held in the GLD Trust was removed.  The common narrative scooped up like dog crap and tossed in our face by Wall Street analysts was that the decline of the gold in GLD was indication of a new bear market in gold. Essentially gold bottomed in price on June 28th, with a retest of that bottom at the end of December.  Based on the $1180 bottom, gold has risen $90 since since the end of June.  But guess what?  Another 179 tonnes of gold – or 19% – of the amount of gold in the GLD trust at the end of June has disappeared.  If gold is rising again, shouldn’t gold be flowing back into GLD?  The 500+ tonnes of gold that has been removed from GLD in a little over a year has disappeared down the rabbit hole.  There’s no way to know for sure but I’m sure a large portion, if not all, has been shipped to China. But maybe not all of it.  In addition to the huge ratio of gold to physical gold visible on the Comex, according to the latest OCC bank derivatives report the top 4 banks – JPM, Citi, Goldman, Bank of America – are long over $81 billion in gold OTC derivatives.  That’s the equivalent of about 1800 tonnes of gold at current at the current price.  1800 tonnes is slightly less than than the annual amount produced globally by gold mines.  That amount dwarfs by many multiples the ratio of paper/gold on the Comex that has drawn everyone’s attention.  Maybe that’s why the Comex publishes as much data as it does about Comex futures positions and inventory.  It draws everyone’s attention from the much bigger gold derivatives problem Here’s a link to the OCC derivatives report for anyone interested (it’s from Q3, 2013 – there always a big time lag):  Latest OCC Bank Derivatives Report

Something really ugly is coming at our system.

Gold Daily and Silver Weekly Charts – Bounce

January 14, 2014

Gold and silver popped a little today, added to the after hours increase which they enjoyed on Friday. Stocks are in an asset bubble uptrend, and gold and silver are in a remarkably persistent price decline.  Meanwhile at the Comex warehouses, HSBC, the custodian for GLD, managed to add some gold back to the registered (deliverable) inventory. More will most likely be needed for February. As I said for stocks this evening, follow through is everything. Have a pleasant evening.


December 13, 2013 Mentioned multiple times before that Hong Kong is one of the cheapest places in the world to buy gold. But the bottom line is that it’s getting a bit more difficult to do so.


At [              ] Bank, for example, they will now only sell a maximum of HK$120,000 (about US$15,400) worth of gold coins to non-account holders. This is less than 12 ounces of gold.


Now, if you open an account at      [            ] Bank, no limit applies. And, the good news is that anyone can still open a bank account with them.       [            ] does not require Hong Kong residency or a Hong Kong Identity card to open a bank account.

But, you will need to show up in person to the bank with the following:

1.  Passport

2.  Proof of current residential address I would also bring a driver’s license or other identity document that has your address on it, if possible. The proof of current residential address can take the form of a utility bill – an electricity, gas, or water bill is best. But, a bank statement may also be accepted. 

The utility bill or bank statement cannot be more than 3 months old. And the name on it must exactly match the name in your passport.

In terms of inventory, [             ] only has current-year Australian Kangaroo Nuggets from the Perth Mint. All sizes are available: 1 Oz, ½ Oz, ¼ Oz and 1/10th Oz. 

According to the bank, it’s possible for customers to buy up to 100 coins without any problem. But stocks are limited, so several hundred coins at one time would be problematic. 

Their prices are still good – about 4% above spot gold.

Truth: a great holiday gift idea

One of the things we talk about routinely in this column is the fraudulent nature of the global monetary system. When you step back and look at the big picture, it seems ludicrous. We have essentially awarded totalitarian control of our money supply to a tiny banking elite.  And in controlling the money supply, they have the power to set or manipulate the price of just about everything on the planet. I’m certain that at some point in the future, financial historians will look back with astonishment at how we could allow ourselves to be bamboozled like this. We have literally entrusted the entirety of our wealth, savings, and livelihoods to just a handful of people. It’s insane. What’s even crazier is how few people really understand how this system works.  If anything, we’re told that there’s a crack squad of brilliant economists making decisions about things that are simply too complicated for us little people to understand. And we just have to trust them to be good guys. As a regular reader, I’m guessing that you already understand that this monetary system is one of the most blatant, destructive scams in history. But chances are, you have a lot of friends and family who don’t get it. This is always a tough nut to crack. People can be very intransigent in their ignorance. They’ve grown up for their entire lives hearing about how they live in a free country with the strongest currency and richest government in the world.  They’ve become so brainwashed that suggesting anything to the contrary is tantamount to blasphemy. And it can be very difficult to talk to them about the truth. Fortunately the holidays are coming up. So if you’re thinking that you might want to educate some of the important people in your life, here are a few inexpensive gift ideas that might just transform someone’s entire worldview: 1) Book: The Creature from Jekyll Island G Edward Griffin’s investigation into the creation of the Fed really does read like a detective novel. At 600+ pages, it’s long. But it’s a real page-turner.  And after finishing it, your loved ones won’t ever look at money, politics, or banking the same way ever again. 2) Book: End the Fed Written by none other than Dr. Ron Paul, End the Fed synthesizes historical analysis, common sense economics, and his own personal experiences from decades in Congress, all to argue one simple point– that the Fed is destructive and has utterly failed in its mission. 3) Movie: Money for Nothing. This is my personal favorite, one I definitely recommend checking out. Even if you are up to speed on these concepts, I can almost guarantee that you’ll learn something. Money for Nothing is a 90-minute documentary that was professionally and impeccably assembled by Jim Bruce and his all-star team.  The film is not only incredibly entertaining, their access to top former and current Fed officials was simply incredible– names like Volker, Yellen, Plosser, Fisher, Lacker, Poole, etc.  Money for Nothing is available for purchase (DVD or digital download) at

December 6, 2013

COMEX Warehouse Gold Bullion: Price Moves Smell of Desperation As Inventory Remains Thin

‘O sir, to willful men, The injuries that they themselves procure Must be their schoolmasters.”  William Shakespeare, King Lear

There were 3,215 ounces of gold bullion taken out of the HSBC warehouse. The JPM warehouse had 7,143 ounces changed from deliverable to eligible. Perhaps the price action freed up some bullion from the GLD ETF.  They need it badly. The levels of gold bullion backing up the leveraged COMEX paper claims on gold exchange remain remarkably thin and oversubscribed. The international monetary regime is changing.  Nothing could be more clear if one listens to what is being said, and sees what is being done. The European Central Banks have made their intentions quite clear, and the Asian monetary powers are in full preparation for their plans, whatever they may finally be.

The forces driving this change are powerful and founded in time and nature. We are watching history unfolding. Today we saw the familiar methods of the past in a blatant pricing exercise that smelled of desperation. They can set the price by force in the markets in the short term, but they cannot produce that which they have taken, or fulfill that which is owed. Weighed, and found wanting.

It’s uncomfortable to think that the ‘richest’, most powerful nations in the world– the United States, most of Western Europe, Japan, etc. are already insolvent.    History is full of examples of superpowers buckling under the weight of too much debt and unsustainable finances. The Roman Empire. The Soviet Union. The French Bourbon monarchy. The Ottoman Empire. 

This is not the first time in history that it’s happened. And it’s foolish to think that ‘this time is different’. 

Furthermore, history shows that whenever governments enter this ‘orbit of insolvency’, they almost always rely on the same destructive playbook of tactics. Capital controls. Price controls. Gun controls. And more………

“It’s a big club…. and you ain’t in it.”

— George Carlin

It must be a byproduct of the government-controlled education system; people still think they live in a free country with a representative democracy. It’s anything but.

Voting, elections, etc. are all just illusions to make people think that they have some influence in society.

A tiny elite orchestrates the whole system. And one of the most influential conductors is the Federal Reserve, a body soon to be chaired by Janet Yellen. Her confirmation process begins today.

Since most people have no idea how central banking really works, her confirmation hearing today is just a footnote.

Even people who are otherwise financially sophisticated simply trust that the men behind the curtain know what they’re doing.

This is quite strange when you consider that central bankers have nearly total control over the economy. In their sole discretion, they are able to set interest rates, conjure money out of thin air, finance trillion-dollar government deficits, bail out commercial banks, etc. And through these tools, they have the power to manipulate the prices of just about anything, from the Google stock to real estate in Thailand to turnips in Sri Lanka. For the last several years, the US central bank has set the example for the rest of the world in aggressively using their policy tools. Most significantly, they have unabashedly printed money in unprecedented quantities. And this has not been without consequence. For some, the effects have been beneficial.

Rapid expansion of the money supply has pushed asset prices up all over the world. Stocks. Bonds. Many commodities. US Farmland. Artwork. Fine wines. Just about every asset class imaginable is near its all-time high.

People who are already wealthy have the available funds to invest in these markets. So their wealth has grown even more– exponentially. The middle class, on the other hand, is experiencing an entirely different effect of money printing– retail price inflation. And anyone who has been to a gas station, airport, university, doctor’s office, grocery store, etc. over the last few years understands this phenomenon very well. A typical middle class family has little excess cash to invest after paying for rapidly increasing living expenses. Food. Fuel. Mortgage. Insurance. Etc. And whatever wages or savings they have are being eaten away by inflation. So while the wealthy are getting wealthier exponentially, the middle class is actually getting poorer. This explains why the wealth gap in the Land of the Free is the largest since 1929 at the start of the Great Depression.

Central bankers are responsible for much of this. In conjuring money out of thin air, they are benefitting one segment of society at the expense of another.

And with Janet Yellen soon chairing the Fed, very little will change.

Yellen has made it clear that she will continue to print unlimited quantities of money despite overwhelming data that such actions are ineffective and destructive for the the majority of the population.

 13 November 2013

Are We There Yet Daddy?



Courtesy Report for Premium Viewers

THE MATTERHORN INTERVIEW – September/October 2013


On behalf of Matterhorn Asset Management, financial journalist Lars Schall talked with Jesse, the host of the popular financial web site Jesse’s Café Américain, about, inter alia: his interest in precious metals; why he thinks the U.S. Commodity Futures Trading Commission decided to take no action regarding complaints about manipulation of the silver market; the future of the so called “currency wars;” and last but not least why he believes that the Federal Reserve is laying the groundwork for its own demise.
By Lars Schall
[big snip]
L.S.: Why do you focus in your work especially on precious metals?
Jesse.:  Gold and silver became interesting for the first time in the 1990’s, when I started to study the history of speculation and stock market crashes, and the rise and fall of bubbles.
This led to a fairly serious study of the nature of money. Up to about 1999, I had no interest in gold and silver. What I saw happening in the world economy then sparked my interest in that subject.
I write about gold and silver now because they are at the heart of what is happening. And there is not as much about stocks and bonds, because I have stopped trading actively in such a broad range of things.
I am fascinated by the sea change in the world monetary system, which has been colloquially called ‘the currency wars.’
L.S.: Will those ‘currency wars’ intensify going forward according to your analysis, and if so, how do you think they will play out?
Jesse.: Yes they will intensify and we are seeing that already. A fiat currency is an exercise in both confidence and power. As confidence weakens, the use of power must intensify to maintain it.
One of the things that people forget is that when one adopts a common currency, they surrender a portion of their economic autonomy. We are seeing this play out in the European Union as monetary theory would predict.
In adopting a common currency, the euro, the entire region thereby agreed to let a central group set their monetary policy for all, which includes the ability to tighten and loosen supply in response to prevailing economic conditions. But whose conditions, when they vary over a broader area?
When a country adopts another currency, they surrender a portion of their own fiscal authority, and thereby their political autonomy. If you do not believe this, just look at what is happening in Greece and Cyprus.
A common fiat currency system works over a large and diverse region such as the United States because in addition to monetary union there is a political union as well, including transfer payments and spending to those regions which may have differing economic conditions. Fiscal policy evens out the blunt force of a unified monetary policy.
This is important, because as the rest of the world is now seeing, the dollar hegemony is not working because the United States is setting monetary policy for itself, but is doing it with the world’s reserve currency. This is where the dislocations begin in some regions of higher natural growth, which see inflation and other effects first that place a stress on their political governance.
The outcome of the currency war will be something like a supra-regional government that encompasses most of the developed world, with the same problems that have become apparent in the European Union that leads to repression, or in some other resolution that permits for local autonomy with more flexibility for international trade. Obviously this is a range of possibilities and the actual result will be evolving somewhere in between.
The creation of a ‘currency’ that is not under the control of a single political authority could be achieved by creating a unit of trade based on a broad basket of national currencies. It ought to include something that is not under the control of a single country,  such as gold or silver.
There will still be manipulation of currencies and metals, but the manipulation would be more difficult because the power of each is diluted within a basket if it has been constructed well.
Since money is power, those who are in control of the money of the status quo, the US dollar, will resist this change, even to their own eventual disadvantage and destruction. Pre-eminent among those are the multinational banks, which are loosely called the Anglo-American banking cartel. This extreme defense of untenable positions is an unfortunate tendency of human nature, and especially of those who are driven to seek power and fear losing it.
 By the way, the US is suffering a protracted recession now because while monetary policy is active, although misguided, the fiscal policy has stopped functioning well because of political deadlock. The monetary policy that Bernanke has set is a trickle down approach, which is obviously failing because it is operating in a system that was already skewed by corruption and has not been reformed. It is like sending aid to a Third World country. The aid is seized by powerful warlords and used for their own advantage, with little reaching the people.
They know this, but they do not care. It is about personal advantage and careers.
In the US in addition to political deadlock, caused by a struggle for power, there is ironically a credibility trap as well. Both sides are dipped so deep in the corruption of the system that they cannot bear to unleash any uncontrolled reform movement, but they are also fighting one another for the spoils. I have seen this play out in the failure of major corporations, and I am seeing it now again on a larger scale.
L.S.: What would you say is essential to know in order to understand the precious metals?
Jesse.: Exposure to other cultures and times is most important. One can become very insular and parochial in their thinking. We can believe that what is now has always been, and will always be so.
As the great financier Bernard Baruch once said, gold ‘has worked down from Alexander’s time. When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory.’ So if one wishes to understand what money is, they might start with gold and its inherent characteristics, since the majority of history seems to have voted in its favor. This is not to say that gold is the only money, but rather, if you wish to understand money, you must first understand the essential characteristics of gold.
One of its great advantages is that gold and silver have no counterparty risk, and depend on nothing but themselves for their value. Think about a time traveler, who takes a fifty US dollar bill and a fifty dollar gold piece back to ancient Egypt or Rome. What is the probable relative value of each? What has changed? Therein are the difference and the risk.
L.S.: Would you support a free competition of money so that people can choose the various forms of money that they want to use without a force behind it that imposes it upon them (a monetary diktat)? I think your critique regarding the Modern Monetary Theory (MMT) goes a bit in this direction.
Jesse.: Yes you are right, the difficulty I see with Modern Monetary Theory is that is has not constructed a systemically based governor in its monetary construct.
In theory the Federal Reserve and the Treasury are circumscribed by the judgement of the debt markets which are diversely held. With regard to Modern Monetary Theory I have asked what the limiting factor on issuing money might be. The reply to date has been that no limitations are required because a fiat currency cannot default, and the valuation of the currency can be maintained by force (manipulation) of various types.
This only works if one has sufficient political force over everyone who uses the currency. That has been tried before, in the Soviet Union for example. The currency deteriorates from the outside in, from the basis of international trade. And it takes increasing force to maintain the currency as confidence fails.
I am sympathetic to the idea of displacing debt as the basis of currency because of its many abuses. But that speaks more to the corruption of the system which will find no cure in a purely fiat currency as proposed by MMT which is even more discretionary and powerful unto itself.
A successful currency must emulate some of the characteristics of gold to be sustainable. They would do well to study it. Bitcoin has some promising characteristics, but also some fatal flaws. I have discussed that in the past.
But I should make it clear that I am not in favor of a gold standard per se. First of all, the system is so corrupt and so fragile at the present time that a gold standard would be too severe a cure.
Rather, I would like to see a system where people have a choice to store their wealth in a variety of instruments including gold and silver, and have the ability to settle transactions in things other than an official currency. That becomes a problem given the propensity to tax private transactions, to which I am also adverse. But perhaps that is a discussion for another day.
L.S.: Do you think to own gold and silver these days is the right choice, and if so: why?
Jesse.: I cannot speak for anyone else since everyone’s circumstances are different. In my own case it seems to be a good idea to have a portion of my portfolio in precious metals as a protection against the debasement of the currencies, and the many unknowns that are brought about in a great change in the monetary system such as we are seeing today.
These great events tend to happen over time, and that lulls us into complacency. But they then seem to come all in a rush and intrude on the public consciousness so that people say, ‘how did this happen?’ That is how it was with the last financial crisis.
L.S.: Is the rigging of the precious metals markets getting more and more obvious for you as a trader?
Jesse.: I do not see how anyone who watches the tape can miss it. The sell-at-market of large numbers of contracts in quiet periods, what has been called the Dr. Evil strategy, is hard to miss. The intent is quite clear, to knock the price down for some period of time. A simple rule would suffice to stop this sort of abuse, but it does not happen.
L.S.: What’s your comment on the dismissal by the U.S. Commodity Futures Trading Commission of complaints about manipulation of the silver market?
Jesse.: It is the credibility trap in action. The manipulation of the silver market has the de facto sanction of the government and the regulators who have turned a blind eye to it for so many years that to admit it now would be awkward and embarrassing. The TBTF banks hold so much power because they can threaten systemic destruction, and also ‘know where the bodies are buried’ so to speak.
It is ironic that the US system has now devolved into a series of threats of destruction and power standoffs, in the both the political and financial systems. That is a symptom of lawlessness.
I think that if reform does come it will come slowly, as those in political power try to operate behind the scenes to repair things without risking themselves, and upsetting their personally lucrative arrangements and careers. Transparency is not possible because too many still in power are complicit, and speed is not desirable for them because let’s face it, the system is working for them as it is.
The problem is that short term thinking like this can allow a situation to become so bad that it reaches atipping point. That is why there was such a concerted effort to suppress the Occupy Wall Street movement. No deviation or dissent from the status quo can be permitted at this fragile time.
And this is why they say that every so often progressives and reformers must save capitalism from the capitalists. Their short term greed takes them to some tipping point, and they become locked down in a credibility trap that must be resolved from the outside. That is a period of great risk, because sometimes cures are as bad or worse than the disease.
L.S.: How do you interpret the movement of physical gold from the West to the East?
Jesse.: It is just a surmise, but I think we are seeing an all-out defense of the status quo, as represented by the Anglo-American banks whose power is founded on the dollar. This certainly includes the big European banks unfortunately, but I tend to view all but the biggest multinationals as more dupes than insiders. Greed and hypocrisy are the fashion of the day amongst many.
The East is taking advantage of the artificial pricing of the metals to ‘stock up’ if you will, and are not only buying for themselves, but urging their people to buy as well, with a few notable exceptions such as India which has accounting imbalances and has lagged behind on official purchases. The East is preparing for what they think will come next. The West is caught in a failing system, and keeps doing the same thing as though it will still work, somewhat neurotically perhaps.
L.S.: What does the financial crisis, its causes and how it is managed tell you about the state of the West, for example morally? Or, to ask it differently, do you believe this is just a financial / economic crisis or is this going much deeper?
Jesse.: It goes much deeper. Starting in the 1980’s, the culture of greed and self-centeredness has become increasingly ascendant. Yes, there is always a certain amount of cynical corruption amongst a minority of a people, but sometimes that type of behaviour becomes more socially acceptable, almost contagious, and tends to drive out the good behaviour which cannot compete with it in the short term when the rules are overthrown.
L.S.: If you were calling the shots, what would you do to solve the crisis?
Jesse.: I obviously cannot address that in any reasonable amount of words, except to say that the influence of big money on the political process is the root of much evil. At one time we had a thesis and antithesis in the political debate. But now that the ruling class has found out that they may become quite rich by acquiescing to certain things, and that there are few consequences for what one may do in that pursuit, the outcome is fairly predictable.
We have to bring back consequences, transparency, and the rule of law.
L.S.: Do you support a free-trade zone between the U.S. and the EU?
Jesse.: Normally free trade zones are not necessary amongst mature economies that are operating on a set of common principles and openness. The zones are generally used to encourage growth in a particular geographic area, so it is a form of government subsidy.
I also do not favor a regional or world government, because the greater the concentration of power, the higher the probability of groupthink, shared policy errors, crony insider dealings, and corruption. ‘Free trade’ like free markets is a fantasy that seems to be a stalking horse for world government. They are not naturally free.
I like differences, and think people should have the ability to determine how their own society should function and what its priorities should be within some reasonable set of decencies. And like a common currency, common governance tends to flatten out differences, and encourage repression. I always enjoyed seeing the cultural differences in my travels and would hate to see that replaced by an artificial blandness and dystopian uniformity.
L.S.: This year will see the 100th anniversary of the U.S. Federal Reserve. Your thoughts on this?
Jesse.: It really doesn’t matter what I think, but the Fed is laying the groundwork for its own demise.
L.S.: Why do you think so?
Jesse.: They are discrediting themselves, and have painted themselves into a corner. The notion that an all-wise and selfless group of technocrats can wield such enormous power, while operating in secrecy and by their own judgement, is a romantic myth.
Eventually they make mistakes, and seek to cover up those mistakes, and make even more mistakes in the process. Greenspan was like a slow poison for the Fed, but even if he had not been the chairman in service of the political interests for far too long, I am afraid that the Fed would have probably died of ‘old age.’ A system must renew itself every so often, and the leadership of the Fed has not been up to that challenge. That change must come from outside the Fed which is a creature of the Banks.
It will be replaced by something else. What that will be I cannot say.
L.S.: What are your thoughts on the direction that the U.S. has taken in general?
Jesse.: If one looks at the marvelous and broad international support which the US had after the 911 attacks, and compares that to where the US stands now, in the depths of its scandals and corruption, the policy failure is obvious. I have likened the modern presidency to the emperors of Imperial Rome, with Reagan as Julius. And so now we have Obama as Claudius.  And will Nero come next again?
We speak of the US, but we must distinguish between the government and the people. The government is in the grip of the monied interests, and pays lip service to the wishes of the people. Reform is needed, and a return to the principles that made the US a beacon of freedom, even if it may have faltered in practice.
L.S.: Given your background in computer sciences, do the revelations regarding NSA & Co. surprise you? And what are your thoughts about it that privacy seems to be a thing of the past?
Jesse.: No it does not surprise me. The Internet has placed a great deal of information on a common network, and this creates enormous risks for security that were lulled to sleep by a faith in encryption and Virtual Private Networks. I had spent a great deal of time helping certain entities construct secure networks in the past, and the permeability of the new networks makes me shudder. The Internet is both a blessing and a curse.
Privacy is essential to the individual, but an excess of official secrecy is not compatible with freedom. And the partnering of the corporations and the government in secret arrangements is a deadly threat to personal freedom and privacy. There will be technical solutions. The problem is more in the realm of the political. Again, those who love power rarely wish to relinquish it willingly.
The intensity of the reaction against whistleblowers, most lately Mr. Snowden, is a wake-up call to people who cherish their freedom.
L.S.: Does it frighten you that computers will be pretty soon more intelligent than humans – the so called ‘singularity’?
Jesse.: Not at all because it is not true. A computer is a tool, that does certain things very well. And so is a jackhammer. And a backhoe. And a nail gun.
What is intelligence? A computer is very fast and accurate, and can access an enormous amount of data very quickly. But it is only as good as its programming. It is very adept at deterministic processes. It can ‘ape’ human thought if the programming is good enough, the so called Turing machine. But computers are not self-aware and have no imaginations and no souls. They have no sense of justice.
They are very powerful tools for processing information. But they are tools that remain in the hands of a human mind, for good or ill. People who do not understand them may fear them, but that is how it has always been with all new technology.

L.S.: Are you optimistic for the future of mankind?

Jesse.: Each person sees great peril and challenges in their own time. This is obviously clear from reading history. I have lived a bit over 60 years, and grew up in a period of time when we legitimately feared mass obliteration. My own parents and relatives grew up desperately poor in the Great Depression, and then went off as young people to fight overseas in terrible wars. And we think it is worse now? Only if we think like children who know nothing but their own fears and needs of the moment.
The human spirit is resilient, and to strive for the ideal is essere umano (to be fully human).  And so I believe that the long arc of time bends towards justice as has so commonly been observed, even when it appears that entropy has things in hand.
I am particularly fond of a German poem by Friedrich von Logau that has popularized a theme that has its roots in a philosophical and historical theme that goes back to the Greeks at least.
“Through the mills of God grind slowly, yet they grind exceeding small;
Though with patience He stands waiting, with exactness grinds He all.”
Friedrich von Logau, Sinngedichte
L.S.: Jesse, you’re obviously an homme de lettres. What are the three books / authors you would like to recommend to read?
Jesse.: Alas, you may as well ask me what three foods people should eat. I have read voraciously all my life starting from the earliest age. The greatest gift I had ever received as a young boy was a set of books. But what I enjoyed reading then is not suitable to me now.
I suggest that people put down the popular novels and magazines once in a while, although I hate to say anything that discourages reading of almost anything these days. As human beings we need to challenge our minds by bringing them flush up against the mind of genius on occasion.
But it is hard to do this when one is just coming off the couch of the Internet or television, so one must begin with something that catches their interest. Genuine learning occurs when the mind is taken out of itself by experiencing the joy of learning, and the ecstasy of understanding. But a little learning is a dangerous thing, so learning must become a way of life.
As Eric Hoffer said, in times of great change, the future belongs to the learners. The learned, those versed and situated in what has been, are experts in something that is fading away. They may resist that change, but they are fighting a battle against time and forces that are probably beyond their understanding. And with genuine learning comes humility, and that also is essential to adapting to change, and being fully human.
L.S.: Thank you very much for taking your time, Jesse!
Jesse.: Well, Lars, you’re welcome! But one thing I meant to ask you is why is the German public accepting the de facto confiscation of its gold so cavalierly?
L.S.: The main reason is that it isn’t well informed about the subject per se, and the other one is that it has no clue whatsoever about the monetary system and why gold will be important in years to come.
If our politicians would say – and one day they will – that we should sell the gold that is on our soil in order to pay down some of our public debt, they will welcome it without a second thought.
You can fool them so easily…


Gold Daily and Silver Weekly Charts – Gold and Silver Now Move Into the October Delivery Month

There was no activity in or out of the COMEX warehouses yesterday, with only a small adjustment at Brinks. Here is an interview I did with Lars Schall yesterday. You may read at it here. Lars is a very personable and intelligent fellow, and did a good job of drawing out some comments, and coaxing me to put some things forward more so than I am often wont to do.  I am always grateful for the good work that he does. Next week may be more eventful for the markets as they shake off the last of the summer doldrums.  A slight chill is in the evening air, and one senses even now that winter is coming. I was out most of the day, having an early birthday celebration with my wife.  The countryside is quite beautiful, and the farmers markets are laden with the bounty of the Summer.  I think Autumn is my favorite time of the year, as it winds into the holidays, and friends and family. As you may recall October, unlike September, is an active delivery month for bullion on the COMEX. And December is often the most active of all. The time is coming when we will reap as we have sown. The reckoning comes as the harvest is brought in. Stand and deliver.

Fed is rigging the bullion market to protect the US dollar’s exchange value. There is strictly nothing happening now on the gold markets that would be related to fundamentals. This SMACKDOWN, just like the other ones, is orchestrated, and it doesn’t reflect the extremely tense situation on the physical gold….The demand for coins is soaring….updated 4-24-2013………

 Gold Smackdown

I had the chance to reconnect with a source in the bullion management business, whose operations deal on a direct basis with the shipping desks at the GLD. While remaining unnamed at this time, it was a powerful conversation, and he was quite liberal in sharing thought.

Speaking to what his group is hearing from the main GLD custodian, he noted that“GLD is collapsing in [terms of] the number of share issuance, and [is] being redeemed…we are hearing from my end…that the GLD main custodian has been collapsing it and redeeming it, and that gold is just being shipped via their shipping desk directly to Asia.”

He further added that, “It is quite clearly a major establishment using their shipping desk to ship gold bullion, and potentially having it re-smelted down in Singapore, Hong Kong, etc. It (the gold) is moving.”

When asked his thoughts on the potential for a short-squeeze down the road as all this gold moves east, he concluded by saying, “Anything that can go down as hard as [gold] has, can obviously have a dramatic short squeeze at some time…at the end of this market [I expect] you will have a ridiculous squeeze.”

While much is left unanswered in the public domain regarding this year’s mysterious clearing out of physical gold from Comex warehouses, it would make sense for such events to occur right before a massive run-up in price—whether it be through freely traded markets or by governmental decree.

As a fresh data set, Comex Gold Warehouse Stocks have declined by roughly 4.5 million ounces so far this year, or in dollar terms—$5.89 billion in gold has fled Comex depositories, apparently all on its way to China:

(click to enlarge, courtesy Nick Laird)

Bottom Line: By the time the details of this continually unfolding gold inventory story of 2013 are fully revealed to the public (if at all), the price of gold will be long discounted to the upside. Plan your positions according.

 JULY 2013

Demand Meets Undeliverable Object – A Run on the Bullion Banks

“People of privilege will always risk their complete destruction rather than surrender any material part of their advantage.” John Kenneth Galbraith, The Age of Uncertainty

If this is accurate, if this is really happening, I think that the effects of this run on the bullion banks are going to hit quite a few people dead cold, like a smack in the face. That is because there is so little coverage of what is going on in the media, even the internet media. The gambit of smacking down price to dampen the desire for gold appears to have backfired in a big way by sparking an insatiable demand for the physical metal and a remarkable decline in available inventories. That certainly wasn’t what had been expected I would imagine when the process of a more energetic price manipulation in response to Germany’s request for the return of its gold began. That a sovereign nation asked for the return of its own gold being held in custody, and that request was flatly denied, is almost as unbelievable as the fact that so many are willing to take it in stride, like something that would happen every day.   A seemingly unstoppable force, the flow of gold from west to east, is going to meet the undeliverable object, the nominal inventory of unencumbered gold in the bullion banks and exchanges, sometime over the next twelve months. Of course one cannot predict exactly what will happen and when, given the phony controversies, obfuscations, and stonewalling that seem to settle like a thick fog over the markets at every treacherous turn in this slowly unfolding financial crisis.  But the math is intriguing. This is getting very interesting. Let’s see what happens.   Is this what I wish to happen?  No, I would prefer that the markets be transparent, honest, and provide genuine price discovery and allocation of capital with relative rationale decision making open to all market participants.   I think for now the game is badly tilted in favor of insiders and their powerful friends. I do not believe that there can be a sustainable economic recovery without genuine reform.  A financial disaster is what the financial predators seemingly wish to happen, assuming they even care about the broader effects of their foolish greed. At some point one would have to anticipate a declaration of force majeure and/or a change in the rules if the financial interests do not relent on their aversion to a market-clearing price.  And when that tide goes out, we will see who is swimming naked. But there remains plenty of opportunity for more desperate antics, so as always caution is advised , particularly in the use of any leverage and short term time horizons.  This is not a healthy trading environment for the non-professional.  And many a person has gone bust by underestimating the shameless manipulation of the markets when regulation is lax. The exchanges and the Banks will not fail, because the financiers and their friends make their own rules as they go along, and do not hesitate to act in their own interests, promises and customers be damned.  That seems to be the way of modern finance and monetary theory.  Whatever we say it is, is because we say it is.  The time for debate seems to be coming to an end. Weighed and found wanting. Stand and deliver. 

Gold Daily and Silver Weekly Charts – Post Expiration Gut Check As Expected

We had the expected post option-expiration gut check in the metals, which rallied back into the close.  These jokers are about as subtle as our little girls when they play Monopoly,  and make up their own rules as they go along. Interestingly enough it appears that JPM is exploring ways to exit the commodities business.  This could be fallout from their recent Enron like energy experience.   Maybe this is more insulating themselves from the vagaries of the market sort of thing.   There is intraday commentary about next week’s packed macro-economic calendar here. The reports include an FOMC decision, advance GDP for the second quarter, and a Non-Farm Payrolls Report. It is funny that President Obama chose this week to kick off his ‘don’t blame me for the economy’ road trip. See you Sunday evening.

So when you hear accounts that 100’s of tonnes of “gold” were dumped on the Comex market , please understand and know that this was “gold” as represented by a paper Comex gold futures contract.  On the Comex gold grows on trees – everywhere else in the world that wants to own gold, physical gold has to be delivered.

“This is an orchestration (the smash in gold). It’s been going on now from the beginning of April. Brokerage houses told their individual clients the word was out that hedge funds and institutional investors were going to be dumping gold and that they should get out in advance. Then, a couple of days ago, Goldman Sachs announced there would be further departures from gold. So what they are trying to do is scare the individual investor out of bullion. Clearly there is something desperate going on…. I have assumed from the beginning that it is the Fed’s concern with the dollar because the dollar is being printed in huge quantities at the same time that other countries are abandoning the use of the dollar as international payment. The exchange value of the dollar is (being) threatened, and if that collapses the Fed loses control over interest rates. Then the bond market blows up, the stock market blows up, and the banks that are too big to fail, fail. So it’s an act of desperation because they’ve got to establish in people’s minds that the dollar is the only safe place, it is the only safe haven, not gold, not silver, and not other currencies.

And to help protect this policy they have convinced or pressured the Japanese to inflate their own currency. The Japanese are now going to print money like the Fed. They are lobbying the ECB to print more. So I see this as a dollar protection policy. …I know where the gold is coming from in the market, it’s just paper. It’s naked shorts, there is no gold there. If somebody wanted to take delivery on those contracts nobody would be able to provide it. I don’t know what the source of the (physical) gold is. Some people are saying that the actual stocks available for possession are rapidly declining…”

Personally I think the wheels are falling off the economies of the West, and the financial engineers are hitting the panic button in advance. The BRICs are going to be in open rebellion if the rest of the G7 joins Japan in massive printing. The Anglo-American banking cartel is doing what they do best: engaging in opaque market operations to shift the pain to the broad mass of innocent people when their schemes start to fall apart.   They have used their usual resources to spread the word in advance.
The kind of mass selling we saw today was not designed to be profit maximizing.  It was designed to flatten price to affect market sentiment and provoke additional selling.   I would imagine we will see some more activity along those lines before this is done. Andrew Maguire says that there is no physical gold for sale at these prices.  I did check a few websites that post decent amounts of gold and silver for sale and the premiums over spot are widening. This assault on property and savings is not all that different that what is occurring in Europe, except it is happening on a global scale.  Time for a grand bail-in, and the mechanism will be the yen, pound, euro and dollar.  The banks must be saved and all must pay. All we can do is be on our watch, and remember who we are, what we know, and what we believe…….

Overturning the Last Remnants of the New Deal

January 2013

Demand for gold coins in the US has soared since the presidential election, as small investors fret about the lack of action to address America’s ballooning debt. The US Mint’s sales of American Eagles, one of the most popular gold coins, leaped 131 percent in November, hitting their highest level in more than two years. The Royal Canadian Mint also had its strongest month of sales this year. Terry Hanlon, president of metals at Dillon Gage, one of the largest bullion dealers in the country, said sales had risen sharply “within a day or two” of the election. “You’ve got a lot of people who are very worried about the economy. With the election they saw that nothing was going to change,” he said. While coins are a small part of the overall gold market, the jump in sales highlights gold’s role as the favored investment of disenchanted Americans. The political gridlock in Washington and the prospect of further quantitative easing when the Federal Reserve’s “operation twist” expires at the end of this year have fuelled demand for precious metals among small investors. “They don’t believe in Uncle Sam any more,” said the head of precious metals at a large bank.

Gold to Gain to $2,000 on Money Printing, Deutsche Bank Says….

By Glenys Sim – Nov 14, 2012 1:08 AM MT

Jim Rogers warns Americans to prepare for “Financial Armageddon,” saying he fully expects the economy to implode after the U.S. election.

Read About The Gold Problem 2013 Here

Hands down, the cheapest place in the world to buy gold coin

2013  Feasibility Report…..This is updated material and as relevant now as at anytime in past 5 years

    For anyone looking to hold gold as a store of value or even medium of exchange,  major gold coin mintage’s like the Eagle, Maple Leaf, and Krugerrand are advantageous because they’re recognizable worldwide. You can do business in a coin shop anywhere in the world from Vancouver to Vanuatu with one of these coins; bulk bullion, on the other hand, needs to be specially weighed and assayed by experts before being traded. For this reason, the premiums for which gold coins sell tend to rise substantially in crisis periods when demand for physical metal is high. In the initial days of the 2008 financial crisis, premiums shot up from 4% to well over 10%, even though the price of gold was simultaneously falling sharply. Today, with gold routinely taking out its all-time highs, gold coin premiums around the world have remained fairly high– this is one of the things that we typically look at here at Sovereign Man as we constantly travel the globe… and why what I’m about to tell you might have you falling out of your chair: One of our Asia partners, was in Hong Kong last week, and he conducted his normal rounds of the various banks in the Central business district that sell gold bullion coins over the counter to walk-in customers such as Hang Seng Bank, Bank of China, and Wing Lung Bank. At Hang Seng Bank, Canadian 1 Oz Maple Leaf coins — in pure, 24 karat gold — were available for cash purchase in Hong Kong dollars at just 0.5% above the prevailing spot price of gold. This is dirt-cheap… or as they say in Chile, ‘precio de huevos’, and it certainly presents an interesting arbitrage opportunity. Depending on your objectives, however, there may be even better gold coin buys in Hong Kong at the moment. Over at the Bank of China, for example, the Chinese Panda coins were quoted at 4.9% above spot gold. Personally, I think the Panda is one of the most beautiful gold coins of all, and in North America they typically sell for much greater mark-ups above the spot price of gold than most other coins, often over 20%. In the UK it’s even more.

Many collectors value the Pandas simply for their aesthetic beauty; and it probably doesn’t hurt that the dealers authorized by the People’s Bank of China to sell Pandas in the US have a virtual monopoly on the market. Still, this situation can be exploited to your advantage– the difference between the buy price in Hong Kong and the sell price in North America is roughly $275 per 1-ounce coin. If I had nothing to do and were looking for some adventure, I’d raise some grubstake to fly to Hong Kong, buy coins, and sell them back home at a profit to pay for the trip… or better yet, offer a fee-based service to gold coin investors to buy cheap coins in Hong Kong on their behalf. For other folks who haven’t yet built up a stash of gold bullion, I would urge you to consider taking a trip to Hong Kong to get started; I’m certain that the money you’ll save will more than pay for the flights, and a nice holiday for you and your loved ones as well.    information is actionable and opportunistic to our readership pro bono from our knowledge network UPDATED

This article triggered a host of questions that I’d like to address today:

l. ” I goggled gold prices in Hong Kong and noticed different prices than mentioned in this article.  Why the discrepancy ? “   Google is the black hole of accurate information. The intelligence on the ground always trumps the ether of the Internet, and my partner was actually standing at the bank in Hong Kong speaking to the cashiers. It’s common to see significant inaccuracies online, especially considering the banks don’t sell their gold over the Internet or the phone… only to walk-in customers. So naturally the most accurate pricing will be at the branch. 2. “Once I buy gold coins in Hong Kong, is there any restriction to taking them out of the country?” No, there are no restrictions for transporting gold out of Hong Kong as precious metals are not a controlled or prohibited item listed by Hong Kong Customs (rough, uncut diamonds are). We have transported gold out of Hong Kong numerous times in our carry-on luggage without so much as a glance from security. 3. “Are there restrictions on bringing in gold coins when I return home?” It depends on where you are flying to and what you purchase. If you are flying to North America, neither the Canadian nor US government considers gold to be a monetary instrument. Maple Leaf and Eagle coins are technically deemed legal tender in each country, so you would have to raise your hand if the aggregate face value of the coins plus whatever other cash you have on hand exceeds $10,000. Bear in mind, customs officials in North America have unlimited authority to do whatever they want, even if you are well within the law. As such, it may be advisable to have a receipt for the coin purchase in Hong Kong, as well as evidence for your source of funds (bank statement is sufficient). If you’re ever in doubt about the regulation, ASK. 4. “Are there any countries that I should avoid for transporting bullion?” Yes, absolutely. To name a few: Mexico. Thailand. Most of Africa. Russia. Uruguay. I would also generally avoid Panama as well– the country’s customs regulations value gold based on its market value, not face value… and anyone who brings more than a trivial amount of gold into the country could end up paying an unnecessary import duty. That’s all for now from `boots on the ground`  risk assessment * Sovereign Man

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Notes from the Field

Date: May 24, 2012
Location: Lake Tahoe, USA

Yesterday was my lucky day.

While hiking in the middle of nowhere around Lake Tahoe, I literally stumbled onto a 1-ounce US silver eagle coin, 1996 issue. It was just lying there on the ground without a soul in sight.

The coin was pretty muddy, but I managed to clean it off later with an old toothbrush and some elbow grease… at which point I decided to take my good fortune on the road for a little unscientific poll.

I’ve traveled to plenty of countries where the local population is very in tune with the prices of gold and silver, particularly in Asia, India, and the Middle East. It’s simply part of the culture.

In the developed world, however, people have much greater confidence in their paper currencies because they’ve been brainwashed since birth to believe their currencies are sound.

As such, I was not surprised by the results of my little informal survey.

Walking around the lakefront resort community where I’m staying, I stopped passers-by and explained to them how I had found this coin. Then I’d ask, “What do you think it’s worth?”

The first person I showed it to held it in his hand and felt the coin’s heavy weight with a slight tick of his eyebrow. Then he flipped it over to the reverse side, saw the “1 OZ. FINE SILVER- ONE DOLLAR” marking at the bottom, and replied, “Uh, a dollar…”

One after another, locals, tourists, and staff alike were completely mystified at the prospect of my weighty silver coin having much ‘value’.

Several people commented on the coins year, claiming, “Well it’s probably not worth much, maybe just a dollar, because it’s only from 1996… I mean, if it were from the 1950s, then you might have something…”

Another common response was “I have no earthly idea.” After half a dozen of those, I changed my approach and walked into one of the local casinos where I saw three bored dealers at an empty blackjack table.

I plunked my coin on the table and asked, “How many chips will you give me for this?”

Each one of them examined the coin and looked at each other in silent conference before one of them said, “$1.”

I asked a few other folks milling around the lobby if they’d give me $5 or $10 for the coin, which seemed to offend people much more than spark their curiosity for the opportunity.

Finally I met a man and his wife who were walking their dog on the beach nearby; I walked up to them and said, “You look like intelligent people, maybe you can help me out… see I found this coin during a hike today and have no idea if it’s worth anything. What do you think?”

The man took the coin and noticed it was silver; he said, “Oh, this is silver… it’s probably worth something. You should SELL IT!”

Great. I finally find someone who actually seemed aware of precious metals’ value, and his initial reaction is to trade it for paper


Like I said, I can’t really say I’m surprised. Even here in this wealthy resort area filled with educated, successful people, nobody really had a clue. Western governments inculcate such mindless devotion to their paper currencies, I suppose it’s a hard mindset to break.

But as unscientific as my informal poll may have been, it does suggest one obvious conclusion: we are nowhere near the mania phase for precious metals… and any talk of a gold ‘bubble’ is complete nonsense.

The current pullback is just that– a pullback. Like we saw in 2008, institutional money managers are locking in their profits as they cash up and prepare to take heavy losses over the euro crisis.

Gold and silver’s real breakout will be when the average, everyday guy has signed up to receive gold price SMS alerts to his smart phone and has the local coin dealer on speed dial.

Just like the real estate bubble in the early 2000s when every Tom, Dick, and Harry was flipping off-plan condos in Miami, precious metals will enter bubble territory when the masses get into the market.

It may be a bumpy ride for precious metals as the euro crisis continues to unfold… but it’s clear that we’re a long way off from the Joe Six-Pack mania phase.