NEW UNCOVERED INFORMATION: Why Central Banks Were Forced To Rig The Gold Market

According to newly uncovered information in the gold market, it provides additional evidence of why the Fed, Central Banks and the IMF were forced to RIG the gold market.  Not only was the dropping of the Gold-Dollar peg going to release a great deal of pressure on the manipulated gold price, but forecasts of a massive increase in gold demand was going to totally overwhelm supply.

Thus, this new information provides clear evidence that the gold market was being assaulted on “two fronts.”  Not only was the gold market suffering from a decades of price suppression schemes via the Fed and Central Banks, but also that surging gold demand in the jewelry and industrial sectors was going to lead to severe shortages in the gold market.

Which means, the gold market was experiencing a great deal more stress than complications stemming from the debasement of the U.S. Dollar due to massive money printing.  Actually, looking at this new information, I had no idea of the amount of Fed, Central Bank and IMF gold market intervention until I put all the pieces together.

Now, when I say “new information”, it pertains to new information and data that I dug up from older official documents.  While most of the folks in the precious metals community realize that the Fed and Central Banks have sold gold into the market to depress the price, this new evidence puts the gold market it in an entirely DIFFERENT LIGHT. 

Furthermore, additional data points to a “Gold Supply & Demand” situation that would have gone completely out of control, if the Fed, Central Banks and IMF did not step in.

To preface this subject matter, the Central Banks dumped a lot of gold into the market during the 1960’s to maintain (suppress) the official gold price.  This was known as the “London Gold Pool” where an estimated 78 million oz (Moz) of gold were dumped into the market between 1961 and 1968.  I explained this in my THE GOLD REPORT- Investment Flows.

However, when Nixon dropped the Dollar-Gold Peg on August 15, 1971, the problems with the global monetary system were just beginning.  In a report published in November, 1972, by the U.S. Congress and Subcommittee on International Payments of the Joint Economic Committee for the purpose of “De-emphasizing gold as a reserve asset”,it stated the following:

Not only did the committee suggest and permit the “voluntary” sale of official gold into the market, but also to “prohibit” against Central bank purchases.  Which meant the committee was proposing a plan to only allow the DUMPING of gold into the market, but forbid any OFFICIAL BUYING.  This of course was supporting the “FREE MARKET” fundamentals for proper gold price discovery…. LOL.

At the bottom of that quote, the committee went on to state that when the international monetary reform had been achieved (to an IMF SDR basket), all prohibitions of gold (investment) purchases by American citizens would be promptly abolished.

So, the wonderful folks up in government had an ingenious method to their madness.  According to their assessment, it would have not been prudent to allow Americans to start purchasing and hoarding gold until the completion of the new fiat monetary system was achieved.

Again, most of us in the precious metals community understand that the Central banks dumped a lot of gold into the market during the 1960’s London Gold Pool to maintain the official gold price.  However, new uncovered gold supply and demand data suggests there was another FACTOR that forced even more dumping of official gold during the 1970’s.

Forecast Of Massive Gold Supply & Demand Imbalance

The reason that Nixon dropped the Gold-Dollar Peg in August 1971 was to keep U.S. gold from flowing overseas as the U.S. Government had been printing a great deal of paper money.  Thus, countries such as France were exchanging Dollars for real gold.  This forced Nixon to drop the convertibility of Dollars into gold so the United States could hold onto its remaining gold reserves.

But, and here is a BIG BUT… converting Dollars into physical gold was only one part of the monumental problem facing the gold market and industry.  Up until now, this was the only real problem that I was aware of as it pertained to the gold market in the 1970’s.  However, forecasts of future Gold Supply & Demand factors were going to totally disrupt the market unless the Fed and Central banks stepped in.

This next quote comes from the USGS 1971 Gold Yearbook.  The highlighted area shows just how bad the gold supply and demand situation was going to be at the end of the decade:

According to a gold expert at Consolidated Gold Fields Ltd., global gold demand was forecasted to reach 63 million oz (Moz) by 1980, up from 42.5-45 Moz in 1972.  You see… this was a BIG PROBLEM.  Why?  Because gold mine supply was also forecasted to decline to 38-41 Moz in 1980.  This would have resulted in a huge net deficit.

So, how well did the Consolidated Gold Fields Ltd., forecast turn out?  Let’s look at the chart below:

Actually, it turned out pretty darn accurate.  Global gold production declined from its peak of 46.5 Moz in 1970, to 38.8 Moz in 1980.  This was mainly due to the peak and decline of South African gold production.  I would imagine very few individuals in the precious metals community realize just how much gold South Africa produced.

No other country has come anywhere near the record annual gold production achieved by South Africa at its peak in 1970:

South Africa produced an amazing 1,000 metric tons of gold in 1970… 32 Moz.  Here are the annual peak production figures from three leading gold producing countries:

1) China = 478 mt (15.4 Moz) 2014

2) USA = 366 mt (11.8 Moz) 1998

3) Australia = 276 mt (8.9 Moz) 2015

China holds the second highest annual gold production record at 478 mt (15.4 Moz) set in 2014.  However, this is still less than half of the 1,000 mt that South Africa produced in 1970.  According to GFMS 2016 Gold Survey, South Africa’s gold production was 151 mt (4.8 Moz) in 2015.   The once mighty South African gold production has declined 85% from its peak in 1970.

Now, taking the 1980 forecasted supply and demand data by Consolidated Gold Fields Ltd. above, here is the result:

If the forecast of a 63 Moz gold demand figure was true, then the market would have suffered a 25 Moz deficit in 1980.  So, not only did U.S. President Nixon stop the bleeding of gold flows out of the U.S. Treasury, but in addition, public demand for gold that decade was going to explode.

This just could not fly.  Which is why the Congress and the Subcommittee on International Exchange and Payments (listed above) were highly motivated to promote “Official Gold Sales” while prohibiting “Official Gold Buying.”  This was a “ONE-WAY PLAN” for gold… and that was the dumping of a massive amount of the yellow metal into the market.

The Fed, IMF and Official Government Gold Sales During the 1970’s

It’s hard to tell how much gold was dumped into the gold market during the 1970’s decade.  I have plans on putting together a more comprehensive report on the details of what took place in the gold market from the 1960’s to present.  This will include more detailed data on Official gold sales.

However, we have some clues in the text from different USGS Gold Yearbooks.  First, we have foreign gold at the Federal Reserve sold into the market in 1973 and 1974:

As we can see, 2.14 Moz of foreign held gold at the Fed were dumped into the market in 1974 and 1.69 Moz in 1973.  Unfortunately, official sales of gold into the market did not deter the rising gold price.  The gold price jumped from an average $65 in January 1973 to a high of $200 at the end of 1974.

Well, the Central banks could not let this exploding gold price to continue.  Which is why the IMF made this official statement in August, 1975:

The IMF – International Monetary Fund, announced in August, 1975 to sell one-sixth of its gold stocks.  At the time, the IMF held 153.4 Moz of gold.  Thus, it planned to sell 25.5 Moz over the next several years to supposedly provide capital for low-interest loans to developing countries.  I wonder why the IMF did not make this statement back in 1973 or 1974?  And why would the IMF have to sell gold to provide capital for developing countries??  Wasn’t there a new FIAT MONETARY REGIME??

Wasn’t gold now a “Barbarous Relic?”

With the IMF “strategic”announcement that it would sell 25.5 Moz of gold into the market, it had a profound impact on the gold price in 1975:

After the IMF gold sale announcement, the gold price plummeted 21% in just one month from $165, down to a low of $130.  Before I came across this information, I just believed that the gold price was due for a correction…. stated by several websites, such as by analysts on King World News.  However, this wasn’t a typical market correction.  Rather… this was a MARKET INTERVENTION FORCED CORRECTION.  Big difference.

So, why the IMF gold sale announcement?  Was it due to a response to the rapidly rising price.. or did rising demand play a part.  If we look at this next quote taken from the USGS 1974 Gold Yearbook, we find our answer:

According to the data, private gold holdings and investment surged 5-fold in 1974 to 27.3 Moz.  The report also stated that total gold jewelry and industrial demand was 23 Moz in 1974.  Thus, total gold demand exceeded 50 Moz in 1974.

I would imagine if private gold investment didn’t jump 5-fold from the previous year, the IMF would have not considered it necessary to announce the sale of 25.5 Moz of its gold reserves in 1975.

In order to make good on its promise, the IMF did sell 3.9 Moz of gold in 1976 and another 6 Moz in 1977 into the market:

In just the first two years after its proposed 25.5 Moz gold sale in August 1975, the IMF sold 9.9 Moz, or nearly 40% of its planned amount.  If we read the first quoted text above (1976), the gold price reached a low in August 1976 after the second IMF gold sale.

Oh, did I forget to mention that another 2.14 Moz of foreign held gold at the Federal Reserve was dumped into the market in 1976??  So, between these two official institutions, over 6 Moz of gold were sold into the market in 1976 alone to guarantee there was a FREE MARKET PRICING mechanism for gold.

I have to make a comment here.  I spend a lot of time at energy and precious metals blogs.  I am completely surprised at the lack of intelligence by individuals who are supposedly very “BRIGHT” in their respective industries.  When I hear comments that gold is nothing more than a “13th Century Middle Ages Relic”, and that digit currency is the new monetary system… the Good Lord Almighty must be enjoying one hell of a BELLY-ACHING LAUGH.

These folks who seem to understand the ramifications of falling cheap energy production upon the global markets still cling to a FIAT MONETARY SYSTEM that needs an ever-increasing supply of cheap oil to survive.  How on earth are they unable to CONNECT THE FRICKEN DOTS is beyond me.

Regardless, the Fed, Central banks and IMF have been rigging the gold market for quite some time… and continue to do so.

During the 1960’s Gold Pool it was more a physical market intervention as they dumped 78 Moz of gold to maintain the official gold price of $35 an ounce.  Then when Nixon dropped the Gold-Dollar Peg in 1971, these official institutions combined “Physical gold dumping” along with the “Creation of a Paper Gold Futures Market in 1975” to rig the gold market during the wild 1970 decade.

I don’t have a lot of data on the paper futures market in this article (will be in future Paid Report), but here is a tidbit on some of the trading volume:

Global Paper GOLD EXCHANGE Annual Trading Volume

1975 = 84 Moz

1977 = 190 Moz

1979 = 1,027 Moz

From the beginning of paper gold trading on the Global Exchanges, it increased from 84 Moz in 1975 to an astonishing 1,027 Moz (1.03 billion oz) in 1979.  The tremendous trading of paper gold contracts (later on including options) sucked in a massive amount of funds.  Thus, paper gold trading funneled a great deal of money away from physical gold and into worthless paper gold.

As I mentioned, I don’t have a full reporting of all the official gold that was dumped into the market from 1971-1980.  That will be included in an upcoming report.  However, it was stated in the USGS 1980 Gold Yearbook, that the IMF did complete its final gold auction in May 1980.  This was their final gold sale that equaled a total of 25.5 Moz from 1976 to 1980.

If we include this amount with the sales of foreign gold at the Federal Reserve and other official gold sales, the amount of gold sold during the 1970 decade was quite an impressive amount… probably something north of 50 Moz.

Again, this was all done to guarantee a FREE MARKET price discovery for gold.  Today, most Americans and citizens around the world have no idea just how undervalued gold is.  No idea whatsoever.

Since the peak of the gold price in 1980, the Fed and Central Banks continued to dump physical gold into the markets at various times up until 2009.  However, “Official gold sales” turned into net “Official purchases” in 2010.  This put a severe KINK in the Western Central Bank plan of gold market rigging.  Just seems like those problematic Chinese and Russians have a much different idea about REAL MONEY than the West.

To continue rigging the gold market in the 1990’s and onwards, the West had to introduce “Gold Leasing” and more exotic “Gold Derivatives” to keep the gold price from going completely BONKERS.  Again, this has been done while the public remains completely in the dark.

In conclusion, the Fed and Central banks were in serious trouble in 1971.  Not only was the dropping of the Gold-Dollar Peg in 1971 a sign that things were about to get very interesting with the gold price, but the forecast of exploding gold demand would have resulted in a 25 Moz deficit by 1980.  This forced the Fed, IMF and Central banks to dump a massive amount of gold into the market to meet the insatiable demand.

Which means, gold became too valuable to be used as money in the U.S. and Global economy.  Yes, that sounds strange… but that is the truth.  I mentioned this in a previous article on why silver was removed from U.S. coinage.  It was due to the same reason.

When I say, “too valuable to be used as money”, I mean it in the way that money has degraded to.  There are no real banks in the world.  A bank should hold stored “ECONOMIC ENERGY” as stated by Mike Maloney.  When someone deposits gold at a bank, that is REAL MONEY.  A bank is supposed to store real money.  Instead, banks store DIGITAL IOU balances, or worse yet, highly leveraged loans.

Since Nixon dropped the Dollar-Gold Peg in 1971, the amount of debt in the world has skyrocketed.  The Central Banks designed a two-tiered system to remove gold as a reserve asset:

  1. Dump physical gold into the market to suppress or maintain price.  Then add a Paper Futures Market to funnel funds away from a limited supply of physical gold and into an unlimited supply of paper gold contracts.
  2. Increase world debt to such massive levels, that interest rates had to fall towards zero.. or negative.  Thus creating a 30+ year artificial Bond Market Rally.  If interest rates rise… the entire system BLOWS UP.

While the ultimate revaluation of gold and silver has taken more time than most of us in the precious metals community anticipated, THAT DAY IS COMING.

As I have mentioned in several articles and interviews, the timing of this event will be known by what takes place in the energy markets as they are the drivers of our economy… and the highly leverage Fiat Monetary System.

Investors should not try to time the markets by selling Stocks, Bonds or Real Estate before the crash comes and then move into physical gold and silver.  Rather, that should be done on an ongoing basis as the TIMING of the event is impossible to predict.

However, it is much wiser to do be in the metals a DAY EARLY than a DAY LATE.

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74 Comments on "NEW UNCOVERED INFORMATION: Why Central Banks Were Forced To Rig The Gold Market"

  1. Steve – What a great article.

    Connecting all the dots and an easily understood summation, is worth it’s weight in gold.
    Looking forward to your forthcoming paid report on the Crime-Ex paper gold Ponzi scheme.

    This really puts into context the Bank of England and the head of the Exchequer, former PM Gordon Brown, of “Brown’s Bottom” fame, or if you prefer infamy, of dumping over 200 tonnes of gold into the market, after advertising the fact that they would do so!

    • Again thank you and nice work.

      Still at this very moment looking at cryptos I see: BTC = $1240 and ETH is at $18.35 EXACTLY mirroring Au & Ag.

      So Steve, let me get this straight….. one Ethereum is equal to 1 ounce of Silver….in the real world, today??

      • 4 oz –

        Don’t be fooled.
        Bitcoin is nothing more nor less, than a de facto digital currency and thus yet another fictitous form of wealth, with a computer system as its counterparty.

    • I’m so glad I found my soiluton online.

  2. Diogenes Shrugged | February 28, 2017 at 6:53 pm | Reply

    Good article … nothing in life is properly understood without understanding the history. In this case, a history of price manipulation. Two questions again come to mind:

    1. Is there any gold at Fort Knox?
    2. Where did the gold beneath the World Trade Towers go?

    Only two reasons I can think of for banks or governments to hold physical gold in the first place:

    1. To provide a paltry, insufficient hedge against a possible collapse of the paper markets.
    2. To prevent a tangible challenge to fiat.

    If I’ve overlooked something, please inform.

    • A “paltry hedge” against a possible collapse of the paper markets?

      Not much “paltry” about it, what do you suppose would happen to the value of the un-backed US dollar if China announced they were backing the Yuan with gold? Yes, they could do that. Russia would probably join them in that move… And as the dollar collapsed, what would interest rates on US debt do? Yep… and then what would happen to interest payments on our national debt if rates averaged 7% instead of 1%?? Yep… default.

  3. Steve

    Another excellent article.

    The more i follow your work with the information and charts you provide for us readers the more i can see the past, present and what the future has in the days ahead and it amazes me how the government and banks have been able to keep this fiat monetary game going this long.

    Also by following your work i am starting to CONNECT THE DOTS and can see past where many precious metal bugs are stuck and cant see any further.

    As you mentioned “Oil in the energy that drives the economy, finance steers it , gold and silver are the batteries that store this economic energy”

    I can see the when this implodes gold and silver will release A LOT of energy that has been held down for decades.

    Exciting times to be alive and witness these changes on the horizon.

    • D S –
      Check ZH for Koos Jansen’s latest report on his FOIR to the US Treasury about Fort Knox gold. It has just been posted and is very interesting. Koos is scathing in his remarks on the low degree of professionalism shown by the so-called Treasury auditors.
      Oh and by the way, “someone” (cough-cough) dumped over $2 billion of paper notional gold futures onto the market this morning March 01, 2017.

      • Diogenes Shrugged | March 1, 2017 at 1:32 pm | Reply

        OLI – Thanks. I read the top of that very long article first thing this morning. Like this SRSrocco essay, that article explored important history.

        We still know essentially nothing about Fort Knox gold. It ranks among the great secrets of the world. If the government had nothing to hide, they’d not be working so hard to hide it.

        I’ll bet you all the gold in Fort Knox that there isn’t much gold (if any at all) in Fort Knox.

        • More dumping –

          “Someone” dumped over $2 billion of paper notional silver onto the market at midday today, which as per their plan forced down the price of comex digital silver.
          We all know who these “someone’s are.

        • The Fed has refused a full and honest audit of US gold reserves… that pretty much answers all questions… will Trump call for the audit, as rand Paul has requested again and again, and via Bills in congress? It will be a good indication of Trump’s independence from TPTB… or not…

        • What a pluerase to meet someone who thinks so clearly

  4. Actually, there IS one real bank in the world, that allows people to pay and get paid, and save, US legal tender gold dollars: the United Precious Metals Association in Alpine, Utah. It is a 100% reserve bank that deals only in US legal tender gold eagle coins, and issues its depositors Visa debit cards thay automatically convert gold dollars into Federal Reserve Note fiat currency. Depositors may withdraw their gold or silver at any time.
    upma.org

  5. > However, it is much wiser to do be in the metals a DAY EARLY than a DAY LATE

    Correction: wiser to be in metals a YEAR EARLY than a DAY LATE. Even ten years would still be wiser for most people, if metals are strictly physical.

  6. One should hold many other assets, too. Depends on were and what you are / need to have.

  7. Steve,
    On a different note. Have you seen Ugo Bardi’s latest article challenging the validity of the Hill;s Group study?

    • Craig,

      Yes, I am quite familiar with the information published in Ugo Bardi’s blog. It was taken from comments made by Seppo K in response to the Hills Group ETP oil model. Actually, Seppo K. contacted me via my website to say he had also contacted Bedford Hill to work with him to assist refining the Hill’s Group ETP model. However, there seems to be a difference of opinion on the particulars of the thermodynamics.

      Furthermore, I am part of Ugo Bardi’s Google Energy Transition Group. There has been an ongoing debate on this issue. Unfortunately, I won’t go into too much detail because Bedford Hill, Louis Arnoux and Allister have published a paper on the Hills Group ETP Oil Model that has been submitted to the Royal Society Open Science for journal publication.

      While I understand both sides of this issue, I still back the Hills Group ETP oil model over the debating arguments. Why? The best way to say it is by comparing the FIAT MONETARY SYSTEM with GOLD-SILVER. Even though there are very intelligent PHD professors of economics stating the positives of the current fiat monetary system, we know that it’s a HOUSE OF CARDS.

      Thus, there is a BIG RIFT between the differing views on the future of Renewable Energy. Basically, the Ugo Bardi crowd continues to promote the RENEWABLE ENERGY INDUSTRY as it is currently as a positive factor for the future. However, those who back the Hills Group work, tend to disregard renewables because they have a very LOW EROI and are way too inefficient too be considered as a reliable energy source in the future.

      So, there lies the rub. It actually comes down to an ideology even though Ugo Bardi claims that the Hills Group ETP Model is “DEBUNKED.”

      It most certainly is not….. as there have been more and more scientists and engineers coming in the support of the Hills Group ETP Oil Model.

      steve

      • I come at this purely from a layman’s point of view, but for me the idea of ‘renewables’ being able to scale up to the level of replacing fossil fuels is preposterous. I personally feel the ‘Bardis and heinbergs’ of this world are somewhat disingenuous.

    • Craig, there’s even a blog on that topic:

      http://futilitist.blogspot.nl

      Personally, i think i’m good at smelling rats. And there’s a rat in the kitchen. Maybe even more than one.

  8. I’m not sure if it comes across clearly, perhaps because Steve lives with this stuff on a daily basis, that the paper futures markets were created by the CB/BIS/IMF Complex SPECIFICALLY to be able to manipulate the price of Gold without the need to sacrifice much physical metal to maintain control of prices. This has now been proven by the recent release of Diplomatic cables from London which explained that the purpose of the futures markets was to be able to create volatility at will and so discourage individuals from “hoarding” physical Gold.

    • philipat,

      Yes, that Diplomatic Cable was released on Jan 4th by GATA, explaining this in detail. So, the Gold Market Rigging has changed over time. It first was done via a “Physical Gold Intervention” to a “Paper Trading Market.” However, this was stepped up even more than just a Futures Trading Market, when “Gold Leasing” and “Exotic Gold Derivatives” were introduced in the 1990’s.

      Thus, leverage in the gold market has moved up to such an extreme level… when it BLOWS, it will be a sight to see.

      steve

  9. So, do I buy Gold or not?

    • Read all the information you can, and then decide for yourself. And take responsibility for your own decision.

    • How should we possibly know what you do 😕 They used to advise to have about 5-10% of their net worth in gold. Today, most financial advisers don’t ever even mention gold (and/or silver). If I didn’t own any, I’d be purchasing some right away, but would not go in full retard. Regular purchases and some extra on the >15% pull backs is what I do. I think of the metals as our retirement fund, so I don’t ever sell any of the fizz right now. But I do some (small) trading in miners, which is really just a gamble. Anyway, if you’re unsure, read up on it some more before pulling the trigger. Good luck!

      • With the current gold/silver ratio, vs the historic… or the mining ratios… a little “full retard” purchasing in physical silver might be warranted! 😉

        BTW: Anyone have a comment on the Sprott PSLV fund’s holdings? Do they hold only physical silver… or is a large percentage of holdings paper silver?? Thanks!

  10. I was under the impression that 70% of the worlds gold supply came from Nevada.

    • Dan,

      Nevada has been one of the largest gold producers in the world. Approximately 75% of U.S. gold production comes from Nevada. Back in 1998, Nevada could have been ranked 2nd or 3rd in the world as in gold production. However, gold production has continued to decline in Nevada since 1998.

      steve

  11. Ummmm, don’t mess with Mother Nature and the law of supply and demand will eventually win out.

    Perhaps had true demand for gold been permitted, then the higher price would have encouraged more supply.

    Regulations and govt controls only bring the need for more regs and controls. No person and no govt is bigger than the natural laws of economics, they only delay the inevitable.

    • Diogenes Shrugged | March 1, 2017 at 1:53 pm | Reply

      “Perhaps had true demand for gold been permitted, then the higher price would have encouraged more supply.”

      Yes, indeed. When the price received for mined resources approximates their cost of production, and especially when prices fall below cost of production, the producer has no choice but to elevate the cut-off grade. In other words, they “high-grade” the deposit — mining the better grade stuff and leaving more in the waste rock and tailings. Proper stewardship of national resources DEMANDS that prices be well above the cost of production. Otherwise, finite precious resources report to tailings dumps and remain there forever.

      • Maybe not forever.
        When gold hits $5,000 per oz, those tailing pits maybe the new mines.

        • Diogenes Shrugged | March 1, 2017 at 3:02 pm | Reply

          Not if the energy behaves the way Steve predicts. Mining requires enormous energy inputs. The days of re-processing somebody else’s tailings are pretty much over, regardless of metals prices.

          • Diogenes Shrugged,

            Very true. One of the shows that I enjoy watching is GOLD RUSH. Some of those guys are just a bunch of CLOWNS wasting energy while producing very little gold. Oh…… Todd Hoffman is a perfect example of this.

            What was very interesting about the last show was that Tony Beets, the one now using old Dredges to mine gold, said that gold mining in the Yukon was “UNSUSTAINABLE.” He said that the easy to get to gold was nearly gone, and it would take only VERY EFFICIENT operations to mine the less quality gold.

            The Gold Dredges use about one-quarter the amount of fuel that the energy devouring earth-moving machines use to produce the same amount of gold. So, even in the Yukon, Tony Beets is experiencing the FALLING EROI.

            I will be writing an article on this very subject.

            steve

          • Even if oil collapses to $20/barrel?

        • olegig,

          That may be true. However, it will also depend on the AVAILABILITY of oil when the gold price finally reaches that $5,000.

          steve

  12. Been trolling your site and video for some time Steve.

    This is fantastic research and reporting.

    Thanks Maybe I can wake a couple more people up with this?

  13. Personally, I’m greatful for the Gold manipulation. I see it as a door being held open against tremendous pressure. The fundamentals for PMs are very compelling and powerful. I wasn’t aware anything was amiss until 2010. Had TPTB not manipulated the price lower how would someone like myself been able to purchase even one ounce. I’m very greatful and hope the manipulation can be extended for as long as possible. We are not just saving PMs for ourselves but for future generations. When this thing blows I believe PMs will become unobtainable for the masses. Better to save it now then consign yourself and future generations to poverty. I don’t believe there will be a reprieve for those left behind.

    • Exactly my opinion Petedivine. In Venezuela one ounce of silver buys you 6 months of food. On the other hand, when the energy Seneca cliff hits hard, we’ll have other things on our minds.

  14. Hi Steve,

    Great article.

    As Andrew Maguire said in his latest King World News interview, the wholesalers that he deals with had no idea until he informed them in 2010 how highly leveraged (100:1) the OTC market in London was. This is extremely important because the vast majority of gold trading in the world is in London (over 80%) and not the Comex. Since then every time the BIS, Fed, BOE, bullion banks etc hit the gold price the big physical gold buyers in London including the Chinese have been confidently buying on the dip, in effect unwinding the London “paper gold” ponzi scheme. Since 2011, London has lost 3000 tons or a 1/3 of its total gold holdings. Of the approximate 6000 tons of gold remaining in London, the vast majority of it is in fact central bank gold held by the Bank of England on behalf of other Central Banks. The 1000-1500 tons left over is to back the gold ETFs so there is very little unencumbered gold left in London to dump on the market.

    The introduction of new physical gold exchanges around the world including the Shanghai Gold Exchange, ABX etc has placed further strains on the US/London gold price management scheme by depriving it of physical gold supply. China for example as well as producing 455 tons of its own gold last year also imported 1300 tons. If you just add Indian retail demand plus official central bank buying ie Russia (200tons) pretty much all new mine supply 2016 is spoken for.

    Usually when gold flows from London eastward the gold price is dropping and when gold heads west the price rises. This happened in the first half of 2016 as gold poured into London as prices rose. However this no longer seems to be the case as the price is again moving up even though gold is leaving London. If you no longer have physical gold to dump you can no longer meaningfully suppress the gold price.

    I really do think that Andrew Maguire is correct when he states that the physical market is beginning to take gold price discovery away from the paper gold market.

    http://kingworldnews.com/andrew-maguire-broadcast-interview-available-now-2-25-17/

    .

    • Michael,

      Yes… Andrew Maguire makes several excellent points regarding the tightness of the physical market versus the unlimited paper market. However, manipulation of the paper gold market could go on indefinitely. Many investors believe this because they feel as if the Fed & Central Banks can continue to dump more gold into the market for several more decades.

      Moreover, the MAJOR FACTOR that underlies the entire market is ENERGY. Its the disintegration of the Oil market that will cause the 100/1 Gold paper market to collapse. And it is not a matter of taking place next year or a date in the future… it is ongoing currently.

      When the price of oil heads south BIG TIME, it will totally gut a large portion of the U.S. shale oil industry. This will lead to the next CLIFF LIKE decline of global markets.

      steve

      • I do not disagree, Steve, but CNN on 1/17 wrote: On Tuesday, Exxon (XOM) said it is spending $5.6 billion to buy assets in the shale oil hotbed of the Permian Basin, which stretches from Texas to New Mexico. It is the company’s biggest deal since 2010. So XOM is betting there will not be a collapse that will render shale uneconomical… personally, I’m with you, I would not take that bet at all!

  15. Finite money (gold & silver in its physical form) is a cap on growth. So tbtf invented infinite currencies to spin the wheels faster and faster. Until the wheels come off. Until then, accumulate. Or ‘keep stacking’ as they say. Diminishing returns in energy will shorten the timeframe until collapse.

    In the mean time we will see:

    DOW 50k
    Bond yields stay way below the 5% treshold
    Buying power of major currencies keep falling
    Stealth inflation
    Increasing political uncertainty
    Rude attempts to ban cash
    Monetize the kitchen sink

    And, imho, attempts to cap buying of physical gold and silver, by law, taxes, jail, whatever. Start buying while you still can.

    • Trying to gauge the effects of these “smackdowns” of gold price. I think someone mentioned on ZH today that some one dumped a large number of contracts on the market ….to very little immediate or lasting effect.

      Is there a graph/chart showing the amount of these smackdowns, isolated from the background noise of the daily trading, and their resultant effects?

      In other words, is there a way to illustrate the failing effect of smackdowns, if indeed they are failing in their objective? Thanks

      • Hi Hubbs, there probably is. Sometimes a few billion dollars in paper gold is dumped within a few minutes, in a thin market, for no viable reason whatsoever.

        I think about it like this: the amount of gold derivatives is huge, etf’s, GLD etc. It has grown so big that it becomes harder to influence. Diminishing returns of their manipulation is the obvious result. They can’t push it below the cost of production, they are stuck between a rock and a hard place.

        Like .gov debt, they can borrow themselves to the moon and back, smash intrest rates to zero, in the end it all comes crashing down because the currency becomes worthless.

        I don’t look for detailed info on this, because i know its going to crash. My only question is: when?

        • Indeed. Now I would like to see how long it takes for silver to shrug this smack down off. Less than a weekly two?

          • Its not important imho. Paper games between algo’s and tbtf to keep the price within a certain bandwith. Maintaining stability in paper markets.

            When gold hits $8000 an ounce we’re in trouble and you won’t sell. So why would you follow its ‘price’?

          • OutLookingIn | March 2, 2017 at 3:24 pm |

            Hubbs –

            The last big smack down which took place November 11 , 2016 –
            The price just nicely matched that pre-smack top yesterday. Looks like this mark is the line-in-the-sand for the manipulators. They are running scared.

          • Hubbs, what’s your opinion?

          • I have some interest in these price smack downs because looking at possibly buying a few monster boxes. Why not just income average you might ask? Because I am no longer confident that there will be too many more meaningful buying opportunities at this price. If for instance Outsidelookingin suggests that these smack downs occur at 3-4 month intervals or when silver hits a certain price, then it might suggest another smack down on the way back up to 19.00 but with minimal effect. Already silver has recovered some of these recent losses, and I chickened out.

  16. gold is held forth as “sound money” because its quantity cannot be manipulated. and yet here we see gold’s “quantity” being manipulated for over fifty years. you go down to the coin shop, offer to buy a gold coin, the dealer updates the comex webpage and says “thus”, and you pay “thus” plus a profit margin, and you get a shiny. the dealer “knows” the price is manipulated, and the buyer “knows” the price is manipulated, and yet they both just carry on, playing the game.

    seems to me this “gold is money” thing is overblown.

    • What’s gold have to do with the comex?

    • Coin shops make money on the “plus a profit margin”… they care nothing about future prices or manipulation, as almost none of them buy and hold in inventory, waiting for price appreciation. That is not business, that is speculation, or investment. WHEN the dollar collapses, and it must… you will see if gold is money.

      • “WHEN the dollar collapses, and it must… you will see if gold is money.”

        (shrug) sure. but when the dollar collapses then food and bullets will rule the day, and I think almost no-one will care about money for a long time.

  17. perhaps gold is being manipulated so China and Russia can get their fair share. The Chinese economy is gigantic and relatively speaking they have little gold (at least officially). Contrast this with Italy that has a very weak economy but lots of official gold. Since fiat currently reigns, there is no requirement for Italy to sell any gold to pay bills.

    I think when the Asian tigers get the gold they want and need, the system of the US dollar reserve currency will be rejiggered towards the YUAN and gold or SDRs and gold.

    the big question in all this is: If gold is a relic, then why do the central banks care what price it sells for? why bother? they dont worry too much about the price of sugar or corn. but gold and silver, that is a different story.

    • “the big question in all this is: If gold is a relic, then why do the central banks care what price it sells for?”

      they don’t. they care about making sure the rest of humanity has no access to any money system other than what the central banks impose. there are two reasons why the king seizes all the gold – 1) so he has it and 2) so you don’t. it’s the second reason that’s more important.

  18. Nice work, and great collection of records Steve, thanks.

  19. They can do what they want.Yesterday they smashed the HUI again.Gold and silver where increasing.Completley untypical.

    Without a physical shortage no change.

    • DisappearingCulture | March 2, 2017 at 5:56 am | Reply

      Even WITH a physical shortage there may be little change on the COMEX spot, unless it goes on for a while. Physical purchasing would have a significant premium over the COMEX spot; we have seen that

      • “Even WITH a physical shortage there may be little change on the COMEX spot”

        bingo. there will be NO change on comex, because the physical trading is black. comex is theater.

  20. We only can hope that Mr. Trump soon make a new QE-programm.I heared 1 Billion Dollar?
    The first pension fond in the USA is broken.What is really strange that the FED do not try to lead the money to the bonds.

    • “I heared 1 Billion Dollar?”

      might want to turn your hearing aide up. 1 trillion.

      “What is really strange that the FED do not try to lead the money to the bonds.”

      not strange at all. the fed’s purpose is to drain the wealth of the united states and then break it.

      • gman

        I meant german notation(1 Billion).It’s similar to our financial minister when he said:
        “We can only exercice emergency laws when the state is in a deep depression”:

  21. It’s a steady pump and dumb game.You can do nothing.With unlimited fiat-money they create one crash after another one.

  22. I just can’t seem to fathom how people still refer to all indices as ‘the market’. The market ceased to exist
    many years ago. It’s all just one big racket.
    If you question what I am saying, ask yourself this one question. When last was there a prosecution (since Madoff) of any significance in the investment world? Have the shysters on Wall St suddenly decided that morality pays, or is it that regulations no longer exist?

  23. To finish my rant. I literally hate it when people have the naivety to refer to ‘the gold market’ as a market. I have watched on the sidelines as every precious metal pundit from, Schiff, Sinclair,anyone on King World News and Silver Doctors being wrong again and again and again. And there is always some excuse or another about the market being rigged. I can’t spell it out any louder ,THERE IS NO MARKET, IT IS ALL ONE BIG SCAM!
    By the way, this comes from someone who put almost his entire PORTFOLIO into PM’S.

  24. Seeíng as I’m on a roll, let me elaborate further. As the derivative ‘market’ is trading in hundreds of trillions
    and the PM ‘markets’ are trading billions, it would take çhump change’ ‘to move the price anywhere you would like it to be, even to zero. Particularly, if you had the Fed’s printing press backing you up.(when last was the the Fed’s balance sheet audited?)
    Enough about the PM ‘market’, let’s talk about the oil ‘market’. The continued noise about Opec this and Opec that regarding production cuts etc, makes no sense whatsoever. Think about this, as a businessman what would you rather do. Pump more oil at lower prices or less oil at higher prices.Seem’s like a no brainer to me. There must be something else influencing proceedings. Could it be THERE IS NO MARKET but only one big scam?

    • DisappearingCulture | March 3, 2017 at 7:37 am | Reply

      “Think about this, as a businessman what would you rather do. Pump more oil at lower prices or less oil at higher prices.Seem’s like a no brainer to me.”

      When one IS a business owner like me, you think about cash flow. You must have it to pay overhead. So you sell oil or silver or copper or wheat or sugar at the best price you can get, but you sell.

  25. The so-called (by the plebes) government is either a liar (when it is convenient), or it is a truth-giver. To the observer it doesn’t matter, they will either believe, or not; but observances do benefit those who define to the sheep.

  26. Forced to rig because of previous rigging? is force to rig an oxymoron?
    Its like sying that i was forced to lie about fraud, because if i told the truth it would have contradicted all of the iies ive be telling about all of the other frauds.

  27. Root of ALL War: There is over 1.1 Trillion tonnes of gold controlled by the global elite’s central banks, IMF, federal reserve, etal… Deep State Global Elites’ private statements confiscated (pre-Trump protected by Deep State intelligence agencies), reveal the root of the elite in the global control of all markets the past 100 years. Which banks are involved (Russia and China are not), who is on the boards of those banks, the global corporations funded by these banks, their owners and board members… following the money… there is a list of approximately 300 men/women. Queen Elizabeth, the Pope/Holy See, Obama, Bill Gates… the UN, ICC, NATO… all part of the scam… watch WikiLeaks for full disclosure… #Vault7

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