October 2, 2022

GATA Finally Gets The Recognition It Deserves

Every gold and silver investor owes a debt of gratitude to the Gold Anti-Trust Action Committee (GATA).  Long fluffed off by the mainstream media, GATA has been a voice in the wilderness in exposing the manipulative schemes of governments and central banks to suppress gold prices.

With printing presses running wild world wide, the issue of gold price suppression will become ever more critical as the public eventually realizes that the only viable alternative to paper money backed by nothing is a gold backed currency system.

The tireless efforts of GATA, spearheaded by Secretary/Treasurer Chris Powell,  in documenting surreptitious gold price suppression schemes by central banks has finally been recognized by a major mainstream financial publication.

The Financial Times, in an article regarding the repatriation of gold from the Fed by the Bundesbank, talks about the lack of transparency by central banks in the gold market.  (Read the full article here.)

The gold market barely shrugged when the Bundesbank announced it would move 674 tonnes of the stuff from Paris and New York to Frankfurt.

But the move is important: not for what it says about Germany’s faith in French or American vaults; nor for the cost of shifting 674 tonnes of gold; but because it is a major victory for transparency in the gold market.

Central banks are notoriously secretive about their gold-trading activities.

Most report, on a monthly basis, their gold reserves to the International Monetary Fund. But these data fall a long way short of full transparency. They tell us nothing about derivative positions in the gold market — for example, gold loans, agreements for future sales, or options transactions.

The historical lack of transparency among central banks is somewhat understandable.

With 29,500 tonnes between them (a decade of global mine supply) they have the ability to disrupt the market significantly if their trades are too public. See, for example, the reaction to the UK’s announcement that it would sell a large part of its reserves in 1999.

Maybe at some point, the rest of the mainstream media will finally decide to take a critical look at the dealings of central banks in the gold market.

Government Brazenly Confiscates 1933 Gold Double Eagles – Bury Your Gold Deep

Nothing seems to obsess the U.S. government more than gold.  Could this be due to the fact that gold represents an alternative currency to the failing U.S. dollar, despite the assertions of Fed Chairman Bernanke that “gold is not money?”

The case of the government’s effort to seize 10 1933 Double Eagle gold coins from the heirs of a private coin collector highlight the unlimited time, effort and expense the government is willing to expend in their war against gold.  The heirs of coin dealer Israel Swift discovered the Double Eagles in a safe deposit box.  After voluntarily showing them to the U.S. Treasury, the government promptly confiscated the coins, claiming that the coins had never been officially released by the U.S. Mint due to President Roosevelt’s executive order on April 5, 1933, ordering all private citizens to turn over their gold to the government.

An in depth article by Coin Week examines the case of the 1933 Double Eagles and details substantial evidence against the validity of the government’s right to confiscate the coins.  The article also wonders what implications this case will have on future seizures of rare coins from private citizens and comments on the government’s decades old zeal in pursuing the 1933 Double Eagles.

“It is unbelievable to me how much the government has spent on this,” exclaims Dr. Steven Duckor. “It is ludicrous for the government to be spending this much time, effort and money in the 1940s, from 1996 to 2002, and now in the Langbord case. The government should spend money on more important priorities,” in Duckor’s view. “It would be okay to make a deal like they did last time. I would not mind some type of deal.” Dr. Duckor is an expert in Saint Gaudens Double Eagles. Among living collectors who reveal their names, he is probably the most sophisticated and widely respected.

After the government seized the Double Eagles in 2004, the Swift family heirs sued the government for their return.  Last July, after the conclusion of a civil trial, a jury concluded that the government had the right to seize the coins.  The case remained on hold while a federal judge considered subsequent legal motions filed in the case.  On August 29th, the federal judge ruled that the gold coins “remain the property of the United States” and that “Given the evidence, a reasonable jury could find that the ’33 Double Eagles were knowingly stolen or embezzled from the Mint.”   What a shocker – a federal judge ruling in favor of the government!

The case of the Double Eagle seizure is not an isolated incident and the federal government has become increasingly brazen about suspending or ignoring rules of law to settle matters in its own favor.  In a Bloomberg interview, Professor David Skeel says blatant violations of long established law principles by the government is starting to have a profoundly negative impact on the nation’s economy.

Will government gold seizures and other actions that violate principles of law continue to escalate?   We don’t even want to think about how bad things will get.  GATA reports today that in an interview with King World News , Marc Faber fears that “gold will rise so fast that governments will feel compelled to try to confiscate it from investors.”

The very thought that gold investors need to live in fear of their own government is a chilling thought.  Bury your gold deep!

Gold ETF Holdings Hit All Time High As Silver ETF Holdings Decline

The SPDR Gold Shares Trust (GLD) added 10.22 tonnes of gold since last week as gold prices continue to surge higher.  The GLD now has a net gain in gold holdings of 15.80 tonnes since the first of the year.  The all time high holdings of the Gold Shares Trust was 1320.47 tonnes reached on June 29, 2010.

The value of the GLD during August has increased by 12.1% to $73.9 billion on high volume.  During July, the highest volume day for the GDL was on July 13th when 25.2 million shares traded.  On August 8th, 9th and 10th, volume on the GLD exceeded 40 million shares.  On previous occasions when trading volume in the GLD surged, gold prices either pulled back slightly or consolidated in sideways trading before continuing higher.

All of the fundamental factors that have been pushing gold prices higher for the past decade are now being amplified by a looming currency collapse and sovereign debt crises.  Adding to concerns is the apparent inability of central banks and governments to contain the rapidly expanding financial crisis.

As measured by the closing London PM Fix Price, gold started the year at $1388.50 and closed Wednesday in New York trading at $1796.50, up $51.30.  Gold has gained $407.90 or 29.4% since the first of the year.

Total holdings of all gold ETFs recently reached a record of 2,276 tonnes of gold, valued at $130 billion.  The GLD currently holds 41.7 million ounces of gold valued at $73.9 billion.

GLD - COURTESY YAHOO FINANCE

 

The GLD hit a new all time high in Wednesday trading, closing at $174.58, up $5.97.

GLD and SLV Holdings (metric tonnes)

August 10-2011 Weekly Change YTD Change
GLD 1,296.52 +10.22 +15.80
SLV 9,772.56 -86.36 -1,149.01

Holdings of the iShares Silver Trust (SLV) declined by 86.36 tonnes on the week but have gained 236.41 tonnes since July 1st when silver prices began rallying.

Silver prices have not kept pace with the increase in gold prices as investors worry about reduced industrial demand for silver in a severe economic downturn.  Silver closed Wednesday at $39.39, up $1.58.  Silver began the year at $30.67 and is now up by $8.72 on the year returning investors a gain of 28.4%.

The SLV peaked in late April at the $50 level before prices corrected to the low 30’s.  The SLV has had an average annualized total return of 25% over the past three years.

The iShares Silver Trust currently holds 314.2 million ounces of silver valued at $12 billion.

 

SLV - COURTESY YAHOO FINANCE

As the world economy marches off the edge of the cliff and many wonder why, we look back at some prophetic  thoughts from Bill Murphy, co-founder of the Gold Anti-Trust Action Committee (GATA) in an interview with The Motley Fool in June 2010.

“What’s important for your readership to understand is that the markets have been made dysfunctional by U.S. policy and what these bullion banks are doing. Even Alan Greenspan said recently that interest rates were left too low for too long. Had the gold price been allowed to trade freely, interest rates wouldn’t have been able to stay down as low as they were. It would have been a warning sign for people not to get involved in the behavior that they did … not to go with all of the risks that developed. And there’s a good likelihood that the disaster would have been nowhere near as bad as it was.

“Alan Greenspan called gold a “thermometer.” So they diffused the thermometer by keeping the gold price managed. And what’s important for people to understand now is that the same thing is going on. If we’re correct, it’s going to lead to a bigger catastrophe, because no one has learned any lessons.”

 

 

Gold Currency Status, GATA Interview, Gold and Silver Prices

A selection of recent articles on gold and silver from across the internet:

Gold reclaims its currency status as the global system unravelsTelegraph.co.uk

“Central banks of Russia, the Philippines, Kazakhstan and Venezuela have been buying gold, and Saudi Arabia’s monetary authority has ‘restated’ its reserves upwards from 143m to 323m tonnes. If there is any theme to the bullion rush, it is fear that the global currency system is unravelling. Or, put another way, gold itself is reclaiming its historic role as the ultimate safe haven and benchmark currency.”

The story that’s GATA be told Motley Fool

An interview with Bill Murphy, co-founder of the Cold Antitrust Action Committee (GATA).

“What’s important for your readership to understand is that the markets have been made dysfunctional by U.S. policy and what these bullion banks are doing. Even Alan Greenspan said recently that interest rates were left too low for too long. Had the gold price been allowed to trade freely, interest rates wouldn’t have been able to stay down as low as they were. It would have been a warning sign for people not to get involved in the behavior that they did … not to go with all of the risks that developed. And there’s a good likelihood that the disaster would have been nowhere near as bad as it was.

“Alan Greenspan called gold a “thermometer.” So they diffused the thermometer by keeping the gold price managed. And what’s important for people to understand now is that the same thing is going on. If we’re correct, it’s going to lead to a bigger catastrophe, because no one has learned any lessons.”

Silver may advance to $23Bloomberg Businessweek

Silver is called a cheap alternative to gold. The current gold/silver ratio is compared to historical levels.

“An ounce of gold for immediate delivery bought about 65.81 ounces of silver today, compared with the 2008 low of 47.55 ounces and the decade average of 61.99 ounces.”

Five reasons to expect gold and silver prices to be suppressed this weekCoin Update

After reaching an all time high price Monday morning, the price of gold has already dropped by about $30 and silver is down more than $1.

“There are more reasons than usual why the US government would want gold and silver prices to be in the dumps this week…”

How to Value Gold, Gold Mine Output, Gold Coin Minting

An array of recent gold related articles to ponder as the price of the metal dips to $874 per ounce.

Gold Revisited

How do you value gold? Here’s a very thoughtful answer to the question based on a ratio of gold to the global economy and global asset base.

Gold mine output in 2008 lowest in 12 years

As the output from gold mines has declined, the total cash costs have expanded. The average increase was almost 20% against 2007.

Gold coin minting hits 40%

Interesting to consider in light of the previous article. While gold output has declined, gold coin minting has increased by 40%. Other gold investment options such as bars and ETFs have also drawn an increasing amount of gold.

GATA Renews Requests to Treasury, Fed for Gold Data

Will President Obama’s call for greater opnness in government, result in teh reveleation of information related to the U.S. gold reserves?

Accumulate Silver Soon

The Got Gold Report takes a look at positioning by the largest silver players amidst increasingly tight supplies. The holdings of GLD and SLV remain steady, even as the prices of the metals pull back.

And something to reflect on from the opening paragraph, “as governments continued to find new ways to “fix” major economic problems caused by excessive borrowing with much more, ridiculously excessive borrowing, relaxing accounting standards and now even using the U.S. government’s printing press to “buy” its own treasuries (diluting all dollars in the process) … while those seeds of inflation and eventual debasement of all fiat currencies wound up – gold and silver continued to correct lower. “

Growing Demand for Gold, When Will Prices Soar?

Sorry for the lack of posts lately. Let’s get back into the swing of things with a round up of some gold and silver related stories for the past few days to bring things back up to speed.

Federal Reserve Will Fail with Quantitative Easing

Reaction following the Federal Reserve announcement that they will purchase $300B of long term Treasuries.

Bugs triumpant about gold, terrified about US

More reactions from gold bugs who are “triumphant — and terrified.”

Bloomberg TV archive carries Murphy interview

Catch the Bernard Lo interview with GATA Chairman Bill Murphy. It also might set the stage for another segment to debate the matter of gold price suppression.

Bank crisis spawns a new kind of gold rush

An article out of Canada describing what it calls “a bandwagon effect for investment in precious metals.” Many people are demanding physical possession and purchasing 400 ounce blocks of gold.

Japanese Young Boost Gold Buying Amid Recession

An article from Bloomberg about the growing and broadening demand for gold. It describes one firm’s gold accumulation program, which allows customers to have a certain amount automatically debited from their bank account each month and invested in gold.

Why the price of gold is not yet soaring?

A question that is on many people’s minds, especially in light of numerous articles like the ones above. Temporarily putting aside government and central bank manipulation, here’s an excellent evaluation of some of the other forces at work.

Put simply, in order for the gold price to go substantially higher, investment demand must offset declining jewelry demand and, in addition, absorb all the scrap supplies that are now hitting the market as individuals all over the world scramble for cash in a very, very bad economy.

Wealthy individuals are certainly buying the stuff but ordinary investors are still in shock.

To get a really good “gold bubble” going (not to be confused with conditions today that some journalists confuse with the real thing), you need broad participation – lots of embraces from lots of average Joes.