WHAT MARKET MANIPULATORS HAVE IN STORE FOR THE UK AND THE WORLD

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Some advocates of the “One-World-State” ended up deeply shocked in the late night hours of June 24th, as the British people decided to free themselves from the undemocratic rule of the elitists in Brussels. I have no doubt that the market manipulators, who work closely with the elitists, and are often one and the same people, will be doing everything they can to prevent that “Mini-Me” of the One-World-State, more popularly known as the European Union, from collapsing entirely. The actions they will take are almost certainly going to include an attempt to punish the British, economically, for having voted to leave.

In the last few days before the Brexit voting, especially on the day of the vote itself, there was a lot of market manipulation activity. Mainstream media outlets may have refused to publish exit polls, making the outcome a mystery for average voters. However, the big trading banks and their associated hedge funds knew exactly what was going to happen. The banks paid millions of dollars to fund their own private exit polls. They knew the results long ago, and everything that happened over the days prior to the voting, and especially the day of the voting, itself, was based upon that. Their polls were purely designed to insure profitable trading, so I am sure they lacked the political bias that the mass media often tries to build in. In all likelihood, the bankers’ exit polls were far more accurate than any media poll has ever been.

There is another group that knew exactly what was going to happen, though somewhat later than the bankers. This second group watches the manipulation activity of the bankers. If you carefully studied their behavior, you would have known, as I did, that Britain had voted to exit, as early as the middle of the day on the 23rd. Trading on such information, of course, is unethical, in my view. It involves taking advantage of innocent people. If I had done that, I would be no better than those I am criticizing. So, I didn’t. But, I knew. Let me tell you how…

Contrary to popular belief, downward manipulation of gold prices and upward manipulation of paper-based assets (stock and bond prices) is NOT solely done for short-term private profit. Short-term profit is the primary motivation of the smaller, more routine, day to day manipulations, such as those involved in the LIBOR and the London “gold fixing” scandals. However, major market manipulations have quite a different feel and character. The people who run our biggest banks, and the hedge funds they control, in the UK and the USA, work very closely with governments, and, on the surface, at least, profess high ideals and alleged “patriotism”.

The bottom line, however, is that they behave in certain very predictable ways. Most important to understanding them, is understanding the “revolving door.” Government operatives go to and from the banking industry, on a regular basis. Their reward comes in the form of lucrative jobs and/or consulting contracts. The size of the goodies are determined by the usefulness of the particular person during his time in public office, and his potential future usefulness if and when he takes public office again.

A short glance at the $1 million dollars per speech, paid to former Federal Reserve Chairman, Ben Bernanke and the tens of millions paid to Bill and Hillary Clinton, speaks for itself, and I need not elaborate further. Such examples, however, are simply the most open and obvious, and are “tip of the iceberg.” There are literally thousands of people who owe allegiance to private financial players, who are always moving back and forth between employment and consulting gigs with the banks and alleged “regulators”, like the CFTC, SEC, the British Financial Services Authority (FSA), as well as the Federal Reserve, Bank of England, and both the US and HM Treasuries.

In short, the big banks are tightly woven into the government. It should come as no surprise, therefore,  that government money is routinely used to subsidize banks. Sometimes, it comes in the form of outright bailouts, like the so-called “TARP” program in the USA. But, more routinely, it comes in the form of endless and unlimited amounts of money made available by the Federal Reserve and Bank of England in the form of so-called “window loans.” Theoretically, these are 1 day to 1 week “loans” that eventually must be paid back. History tells us, however, that the alleged 1 day loans are almost never paid back in 1 day. Instead, each day, new loans of an equal or greater amount can be issued, in replacement of the earlier loans, and this can go on for years.

For example, the primary dealers of the Federal Reserve had a slowly increasing, but running loan balance, filled with supposedly “1 day loans”, from 2001 until 2009, that averaged hundreds of billions of dollars. The money was eventually repaid, but only starting in 2009, when the Federal Reserve handed over trillions of dollars to the banks to buy deeply depreciated bond holdings at par. The Fed paid par value in spite of the fact that the favored banks would have been forced to sell those bonds, in the free market, at a fraction of the “list price”.

One of the most important things I learned, early on in my law practice, is that liars, cheats, and frauds never admit, even to themselves, who and what they really are. They always come up with an excuse. The explanations usually sound very reasonable, until you pick them apart carefully. Currently, the excuse for government subsidized market manipulation is that “interventions” are “needed” to insure “financial stability.”

If you ask one of the people who carry out the manipulations what his purpose is, he will tell you what he believes to be the truth. That is, he will tell you that, but only if he decided to tell you the truth at all, which is unlikely. But, if he did discuss the matter, he would say that he is working for the “betterment of mankind.” Sadly, chances are he believes his own lies. He will always omit the part about the side bets he and his friends are taking, even as they front run government interventions.

Some of these self-created banker illusions are even repeated in public. They are the origin of comments, by some bank executives, that they are “doing God’s work”. Interestingly, although the powers-that-be and many innocent market participants refuse to admit that the banks are involved in widespread market manipulation, there is at least one criminal case in which a bank admitted that its high speed trading program is designed to do exactly that. The prosecutor told the court that the complainant had told him that it could be “used to manipulate markets in unfair ways.”

The erroneous assumption, of course, that they wanted the court to make, was that while a former programmer might use such power for wrongful purposes, the bank never would. Do you believe that? By the middle of the day on June 23rd, there were obvious tracks of extreme manipulation, going on in a myriad of markets, in the UK and elsewhere. Some of these were obviously government-sponsored programs. Mostly, at that point, they were designed to soften the blow of what insiders knew would be a British exit.

We saw stocks go higher and gold go down sharply, in spite of the fact that the poll could go either way. Possible Brexit was always a very strong possibility, even in the minds of non-connected investors. Everybody knew that, if Britain voted to exit, gold prices would explode, but that didn’t matter. Oddly, the green paper (a/k/a the US dollar) was also inexplicably heading sharply downward along with gold, which was unusual. Indeed, there was little activity, on Brexit voting day, at all that made any sense. The whole thing makes perfect sense only if you look at it from the standpoint of rigged markets.

Admittedly, irrational market behavior does not always equal government intervention. Knowing the difference is an art, not a science. But, it is a solid marker. It is a big red flag that indicates the likelihood of a major government-supported manipulation event. If you see “Mr. Market” suddenly telling you that green is blue and 2+2=5, you know what is happening. You must pay attention to this, because if you don’t, especially if you are speculating short-term, the government sponsored manipulators will take you for all you’ve got.

Very few real investors would heavily sell down gold and the US dollar at the same time. Nor would many do that on the simple hope of a highly uncertain possibility that the public will vote to stay in the EU. Sensible investors don’t do such things because there is too much risk of loss. Normal investors sit down, immobilized, anxiously awaiting the results, at such times. Things should have been quiet for days before, and certainly on the day of the Brexit vote. But, they weren’t. It was a telltale sign of government sponsored market manipulation.

The big banks, no doubt, reported the results of their private exit polls to the Bank of England in the hope of getting free money to fund their manipulations. They probably knew the true division of the public’s sentiment a few days earlier, just by making certain that their polls were free of typical political bias that infects media supported polls. Paper-printing central banks, like the Federal Reserve and, in this case, the Bank of England, are not risk sensitive like real investors. They don’t care about potential losses. They can print as much new money as they need. So, losses don’t matter. What they care about are political issues and so-called “orderly markets.” Basically, orderly markets is a code word for protecting the profits of banks and market makers from sharp movements in stocks, bonds and commodity prices.

In my opinion, the very odd financial market action, on June 23rd, was orchestrated by the Bank of England, at the behest of the banking industry. When you see massive, illogical aberrations, a government sponsored manipulation is very likely underway.  I can’t help but remember the day that the Federal Reserve announced its first, so-called, “QE” program in March 2009. In the morning of that day, prior to the announcement, markets were punctuated by a merciless pounding down of the price of gold. The market manipulators knew that QE would be announced, and they also knew that the announcement would pound down the exchange value of the US dollar and put a rocket engine under gold. That morning, therefore, US dollar index futures soared. Gold prices collapsed in paper gold markets like COMEX. Someone busied themselves purchasing an immense leveraged long position in dollar futures, as well as immense heavy leveraged short positions in gold. That insured that gold would soar upward and the dollar would decline from a much lower and higher base, respectively, than otherwise should have been the case. This was done all in the interest of so-called “orderly markets”, I am sure.

When heavy upward or downward manipulation occurs, the more aggressively leveraged futures market players are involuntarily evicted from their positions. That happens because the price decline caused by the intense distribution of a lot of newly created paper gold contracts, triggers automatic stop-loss selling. Then, the stop-loss selling triggers margin calls which, in turn, creates yet more selling. It is all part of the scheme to control prices, and it happens in all financial markets, but particularly in precious metals markets.

Although gold prices were at the cusp of going ballistic, back in March 2009, most of the long-side players at COMEX lost a huge amount of money. They were the target of that morning’s manipulation event, and they were involuntarily sold out of their long positions in gold. Once the aggressive long players are neutered, in any market, upward price movement is always blunted for some time. In fact, even though Mr. Bernanke announced that he would print some $1.7 trillion new dollars, it took until the next day before gold prices started to react by moving upward!  Similarly, but in the reverse, because the US dollar was magically elevated that morning, severe losses were intentionally inflected upon leveraged dollar short sellers. This limited downward movement in the US currency for a day or two.

The results of a Brexit vote, of course, are different from the results of the QE announcement.  However, they share one thing in common, and that is the probability of MONEY PRINTING!  To meet the goal of “orderly markets”, the Bank of England can be expected to continue printing hundreds of billions of pounds sterling. They will be used to pump up stock prices at the London Stock Exchange. Otherwise, the uncertainty would result in a massive decline in British stock values.  Since the Brexit vote, however, believe it or not, the decline in the FTSE index has been lower than the decline in the Dow and S&P 500 in America! That is the power of market manipulation at work!

A general decline in the British pound was always inevitable because of the money printing. The speed and depth of the decline, however, is being determined by the manipulators. While they could liquidate their positions, now, for a very nice profit, their masters have a score to settle and, on top of that, they sense blood. They will amplify their profits by using investor fear. Central bank money printing will continue to be used to offset fear among British stock traders. The manipulators will opportunistically use this.

In the days prior to the Brexit vote, the Bank of England seems to have sponsored manipulations designed to artificially raise the British pound’s exchange rate. Pre-election, we saw massive leveraged long pound sterling futures market positions levitating the British currencyThat was music to the manipulator’s ears. It created prices that were ripe for the picking. Short positions, betting that the British pound would decline, could be taken at a very high and artificial prices. Later, when the decline inevitably set in, the collapse would necessarily be huge, producing big profits on the downside.

On June 24th, however, the day after the Brexit vote, it was obvious that the Bank of England was going to print an enormous amount of cash in order to support the British stock market. It is impossible to both support the pound sterling and support the stock market through money printing, at the same time, so they chose stocks. The pound sterling, therefore, began falling, but from a much higher base than it should have had, to begin with. The well-connected speculators who knew, in advance, that Britain would exit the EU, are now going to make a fortune. But, they are not finished with the British people yet.

This all may sound to you like tin foil hat material. Why even talk about it, lest take the trouble to analyze it?  If what I am saying is true, there is little I can do that will stop it, right?  Yes, you are right, but only to a point. The reason we follow this is simple. There is great practical value in understanding how the banking cartel does business. For example, contrary to popular belief, the bankers and their controlled hedge funds will not suffer massive losses after Brexit. I have no doubt that many executives have already front run the earlier government interventions, knowing what the outcome would be. While it is true that the banking corporations that they run will probably lose some money over this, the key players, will make a killing. And, to make matters worse, from what I can see, they intend to induce an even bigger decline in the British pound sterling.

There are many non-connected long-side speculators who thought themselves clever, and bought long positions on the pound when it reached its lows on the 24th of June. All other things being equal, the currency should strongly bounce, because it is deeply oversold right now. However, the bounce they are going to get, if any, will be short-lived.  Unlike the big international banks who control the central banks and know what is going to happen tomorrow, today, these non-connected players are true gamblers. They don’t have unlimited sources of zero interest rate cash at their beck and call. In my opinion, that’s why the so-called “risk committee” of the world’s biggest currency futures trading venue dramatically raised the amount of earnest money or “margin” required to hold a position in the British pound.

On Monday, holding a futures contract in British pounds will cost one-third more than it did on Friday. Because of this margin increase, there will be a great deal of additional forced selling of the pound sterling, which will trigger stop-loss orders, and cause yet more selling and margin calls. This vicious cycle will cause the exchange value of the pound to drop even more. It will only end when the manipulators want it to end.  Unlike gold, the British pound is a purely paper asset, and so long as the Bank of England is willing to print up as much of it as the banks that control it want, they will never run out of them.

Part of it is motivated by profit and pure greed, but part is motivated by the “One-World-Government” folks, who now want to punish Great Britain for voting to exit the European project. Many of them have close ties to the banking industry. The British pound is headed sharply down from here, in the short term, not because it should go down that far, but because the manipulators want it to go down, both to enhance their own profits and to prove a point.

In the long term, of course, they will be forced to ease up and the pound will rise. That is because, if it doesn’t, Britain will be left with the most inexpensive labor in Europe, and will become a manufacturing powerhouse again. The attack on the British pound, therefore, will be short lived and self-limited. But, it will be severe for the time that it lasts, and designed primarily to scare the wits out of others, within the EU, who might otherwise want to leave. It will also be deep enough to mint extraordinary profits for the manipulators.

Interestingly, and coincidentally, the COMEX exchange will dramatically increase margin requirements on gold on Monday. That may suffice to cap some of the enthusiasm of long-side gold investors. Some of the more heavily leveraged speculators will be involuntarily sold out of their positions by margin calls. If the interest in buying gold is not great enough to offset that, a subsequent forced selling spree will occur. That will take prices down a peg. The result will be a temporary price decline or a slow-down in gold’s price explosion. Unlike the suppression of the value of the British pound, however, gold price suppression has its limits. Gold is not entirely a matter of putting notations on a computer ledger. If the price goes too low, people will buy it in quantities that the supplier of last resort (a/k/a the US government) will not be able to supply.

The supplier of last resort (a/k/a US Treasury) probably welcomes higher gold prices in the long run, and as the bullion banker’s biggest client, it is ultimately the one on the hook for any losses taken as a result of gold price manipulation. The Treasury no longer has sufficient gold reserves to continue supplying the market at the current burn rate. So, prices must rise. It is just a question of timing. The market manipulators are intent on timing it in a way that minimizes the government’s loss. If the first margin deposit increase doesn’t do the trick, there will be more on the way. They will keep increasing margins until the price rise stops or the price falls. The goal is to exit a massive short position in a managed way at a minimum loss.

I’m sure that any paper losses taken by the gold short-selling cabal will be more than offset by the profits they earn on pound sterling shorts. The price manipulators will not and cannot stand in the way of rising gold prices, in the longer run, and they know it. Indeed, being able to blame fast-rising gold prices on Britain’s exit from the EU is of value in and of itself. Brexit supplies a convenient excuse to allow gold prices to rise, in the longer run, without having it blamed on economic mismanagement by the Federal Reserve, the US Treasury or the Bank of England. It is much more convenient to blame everything on the so-called “populists” who push people to do allegedly “foolish things” like leaving the EU.

In the longer run, in spite of the short-term pain, the so-called Brexit will have little real effect on the British economy. The benefit of relatively free trade is just as much in the interest of other EU nations as it is in the interest of the British. The same goes for trade with the United States. In spite of President Obama’s threat to put Britain “at the back of the line” when it comes to a trade agreement, doing so would be harmful to American interests, especially to the economic interests of the people who fund him and his proxy, Hillary Clinton — namely the banking corporations on Wall Street. They may be co-conspirators but profit always trumps grandiose schemes, and they will not profit, in the longer run, from helping to isolate the UK. Indeed, by next January, the UK may be negotiating a trade agreement with President Trump, and the internationalists will have little say in the matter. A trade agreement with the United States will come quickly, one way or the other.

The UK has voted for a future free of the undemocratic shackles of the current incarnation  of the so-called “European Project”, and the unelected bureaucrats in Brussels. America has a similar problem in reacting to the heavy hand of its own elites, in the Northeast. There is little doubt in my mind that the “internationalists” of Europe will attempt to punish the British, in various ways, because of the fear that Britain may succeed as an independent nation, encouraging other European nations to follow in its path. That will bring the whole grandiose scheme of world domination, that was starting with the so-called “European Project”, to an abrupt end. As Britain leads the way back to democracy, we can only hope that America will follow…

Buy SynodThe Synod is a conspiracy of 8 large international banks who seek to control gold, stock, bond and commodity markets all over the world. Jack Severs runs for his life when he learns too much, as the most sophisticated surveillance system ever built is deployed to track him down. As the ever-tightening noose closes, he struggles to uncover evidence to save himself and his world from collapsing! An exciting, fictional, fun and educational thriller about the banking cartel, and how it affects business, politics and daily life.


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“Brexit” From the EU Is Ultimately Irrelevant

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We’ve been hearing a lot of people employ a lot of scare tactics about how terrible the exit of Britain from the EU would be. Nonsense. Regrettably, the people who create that BS are also the manipulators who are so often successful in fleecing a majority of investors. As we see the ups and downs in the exchange value of the British pound, we see them in action yet again. They will manage to scare people into and out of that currency, and they’ll coin a great deal of money doing it

In reality, Brexit will have little to no effect on the UK, at least in terms of economics. The gains and losses will cancel each other out. That is because the key reason Brits want to withdraw has nothing to do with economics. It is about taking back power over their own country, and walking in step with their own drummer.

If the UK withdraws from the EU, a trade deal with America will immediately happen. It will not be something at the “end of the line” as implied by the propaganda spewed forth by Obama and Cameron. Furthermore, when formal EU membership ends, it will be immediately replaced by some sort of association or trade agreement that provides a similar level of free trade but without control by Brussels.

Why will these two things happen, making the so-called “Brexit” a non-event? The answer is very simple. It is in everyone’s interest and everyone knows it. Companies in America will lose money if a trade deal isn’t immediately struck with an independent UK. Companies on the continent would also lose money upon losing access to the British market. Same for British companies with respect to access to continental European and North American markets.

The ups and downs of the Pound Sterling are irrelevant to the big picture. They represent nothing more than attempts by a cabal of manipulators, in the currency markets, to collude in capitalizing on innocent investor’s fear of the unknown.


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Obama v. Hillary – A Conspiracy Theory That Made Sense Until It Didn’t…

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Obama has just endorsed Hillary Clinton, in spite of saying, yesterdaythat the “super delegate in the White House hasn’t made his choice yet” or something to that effect. It was rather odd given that she had the delegates to win the Democratic nomination. Meanwhile, Sanders is still not bowing out in favor of party unity. Is he just an angry old man?

http://www.marketwatch.com/story/obama-not-ready-to-endorse-clinton-at-this-point-white-house-2016-06-07

Still, the theory that Obama’s Justice Department would feel compelled to indict Hillary Clinton over the emails seems to have fallen apart? It is widely believed that the FBI team investigating the case wants to charge and pursue a case against Hillary Clinton. However, the Obama Justice Department can block it by simply refusing to bring it. If the FBI’s agents ever made its opinion overtly public (it is already semi-public), the refusal to prosecute, obviously, would look very corrupt. If there is a leak that proves that the FBI wanted her indicted, and the Justice Department refused, Democrats will suffer a sure loss in the November election.

I had previously suggested that there might be a secret deal. Think about this… if the indictment had been done early on, the big NYC banks would have surely put up Michael Bloomberg as a third party candidate. In spite of being a Republican in name-only, Bloomberg appeals to wealthy Democrats in NYC and the northeast. He would have diverted contributor money, attention and votes away from Sanders and caused him to lose. In contrast, if an indictment comes just before the Democratic convention, there will be no time to qualify a third party candidate.

Sanders is ahead of both Donald Trump and Hillary Clinton in most general election polls. However, he would break up the NYC banks, which means they support Hillary Clinton. The tiny cabal of bankers have been diligently paying their golden girl $1 million dollars a pop for 1 hour speeches. She’s bought and paid for, and now she’s essentially the Democratic Party’s nominee for President.

Stay tuned!


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READ “THE SYNOD” – AN EXCITING NEW THRILLER ABOUT HIGH FINANCE & INTERNATIONAL INTRIGUE!!

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“This was a good book. Well written and thoughtful. Good balance of action vs. characterization. Characters are deeper than you will find in most thrillers. Educational. Is it fiction or a true story? This I do not know. But, I do know that this is a book worth reading…” Jackie Martin on Librarything.com| Aug 16, 2016 | *****

“The Synod is a well written thriller with an excellent plot and with great well developed realistic characters. The story is action packed and fast paced. Could easily be taking place in present day times. Provides for a quick read and was quite enjoyable. Plenty of information to absorb. Plenty of twists and turns leading up to a great ending…” Jim Phillips on Librarything.com| Aug 17, 2016 | *****

“Exciting and appealing novel, Ludlam`s style (the author should take this as a huge compliment)… Almost felt ashamed being a banker myself. The author appears to be very well informed of or acquainted with various banking and brokerage activities, both bona and mala fides, as well as with (anti) money laundering operations and regulations. That provides a special touch of genuineness to this story….” Gordana Aleksic on Kobostore.com on September 27, 2016


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WHY GOLD PRICES ARE HEADED UP NOW

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As momentum in the gold market turns bullish, many people wonder what has suddenly happened to change things? The simple answer is nothing. The price of gold is simply being set by politics, as has been the case since at least April 12, 2013.

Once you crunched the numbers, it was easy to see that the old prices couldn’t last. In my article, “Did COMEX Just Receive A Physical Gold Bailout From The Feds?”, published in June 2015, I did just that. Gold prices were down to about $1,175 per troy ounce, and I took the trouble to calculate the physical cost of the politics of gold. Comparing new mining supplies + scrap vs. the then-existing demand level, I concluded that some not-so-mysterious gold supplier of last resort had to inject at least 1,345 tons in order to balance supply with demand in 2015.

As it turned out, demand in both India and China went up a lot more than we expected back then, even as supply came in exactly as projected. As a result, the politicians at the US Treasury, in concert with their financial agents on Wall Street, were forced to inject something higher than my figures showed back then. If they hadn’t done so, we would have seen shortages and panic. Since it didn’t happen, in spite of a gap between supply and demand near 1,500 tons, someone supplied the gold. As noted in the same article, the gap between supply and demand in 2014 was about 600 tons. In 2013, there was also a big gap (some 1,200 tons), but it was filled mostly by dishoarding from the shrinking western ETFs.

Since I believe that the only entity with the motive and resources to inject these huge amount of gold into the market is none other than the US government, America’s gold hoard is now down from 8,100 to 6,000 tons of gold. The rest is probably subject to location swap liens and other legal encumbrances owed to other nations like the UK, which may have forwarded the hard physical gold needed in 2014/15 from its vault. It will be expecting that gold back someday.

As explained in June, the financial agent for the US Treasury is almost certainly JP Morgan Chase. They have an overtly disclosed contract to manage the Federal Reserve’s mortgage bond portfolio, and, I believe, a covert contract to manage the Treasury’s gold.  So, let’s fast-forward to today, and see what the big shots at JPM have to say. On February 11, 2016, in an oral interview on CNBC, Robert Michele, JP Morgan’s global Chief Investment Officer (NYSE:CIO), showed great emotional frustration. He seemed to throw up his hands, and while doing that, he stated that people “have more confidence in gold than paper money.”

It was a very puzzling statement for someone to make. It was a bizarre emotional reaction on camera, given the fact that gold prices have been plummeting for 4.5 years!  I believe that Michele’s comments can only be understood in context. If top people at JPM already know that the deep drop in gold prices was artificially contrived, and that the continuing physical demand is natural and real, his statements and facial expressions make perfect sense.

In short, Mr. Michele is expressing his frustration that JP Morgan Chase was unable to break the back of gold demand, in spite of having been given what I believe was carte blanche to invade the US Gold Reserve by the Obama Administration. Have they thrown away thousands of tons of American-owned gold and accomplished nothing?  I believe that they have. That was frustration reflected in what Mr. Michele’s voice, in my view.

Sooner or later, it becomes necessary to slow down the hemorrhage. That means it is now necessary to allow prices to rise somewhat. Money can be made on short term short and long positioning, during the process of gold price normalization, of course. It is not going to happen all at once. It will be a step-wise process. Remember, physical buyers are very price sensitive. When prices go up by $50 – $100 in one shot, they stop buying. That means the price doesn’t have to go up much more than that in order to tamp down demand. The problem is that these sudden bouts of cheapness don’t last long. The hesitancy exhausts itself as they get used to the higher price, and prices must go up another notch.

Over the next year, expect sequential price increases. They will rise in bits and spurts. Up by $35, then down by $20, as price point is tested by both sides, to see how much physical gold gets eaten up. At some point, maybe by the end of 2016, a point where the supply and demand is equalized will be reached. If a new source of physical gold fortuitously appears on the way (like a fire sale by Venezuela?), it will be opportunistically used. But, the physical gold deficit in 2016 would have been over 2,000 tons if gold had stayed beneath $1,200 per ounce. So, even a few hundred tons from Venezuela isn’t going to stop the adjustment process.

The bottom line is that gold prices will now rise because a price must be found that discourages people from buying so much. My best guess is that this will be somewhere near the place when supply and demand last balanced, in late 2012, or somewhere between $1,500 and $1,600 per ounce. That assumes that the sovereign debt crisis doesn’t explode along the way. If it does, the sky is the limit, because the demand will skyrocket beyond already high levels.

In 2017, if our new President is Bernie Sanders and/or Donald Trump, gold will do well. Neither derives large campaign contributions from Wall Street, which means that gold price scams are not going to be an attractive proposition for either of them. Gold can be expected to soar in 2017 under either President even if nothing significant happens. If we have a sovereign debt crisis though, all bets are off.  Irrespective of whether or not a full blown crisis occurs, we will almost certainly see the insolvency of a lot of pension plans in the USA by the end of 2017. That is also going to propel gold demand and, therefore, prices.

If Hillary Clinton, the candidate most beholden to the big NYC banks, is the winner, we will see more gaming of the system, with a renewed effort to control prices. But, the USA is fast running out of gold. Clinton cannot change that. How fast prices will rise is and will continue to be a matter of politics. If Hillary is willing to preside over the emptying of America’s entire gold reserve, prices will be slowed down, or may even decline for a while. But, in the end, they will rise as certainly as the sun will rise in the morning.

I hope you’ve enjoyed this article. It’s been a long time and some have been wondering what I’ve been doing? I assure you that I’ve been very productive. For example, I’ve written a new thriller, “BANK – Thrilling Adventures on Wall Street” which you might enjoy reading. It can be pre-ordered from Amazon.com and automatically delivered to you on its release date of April 16, 2016. The novel is fiction, of course, but it was inspired by a set of true facts. Among other things, the novel touches on the process of gold manipulation and reading it will help you more clearly visualize how it is done.


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Welcome!!

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You’ve arrived at Avery B. Goodman’s Blog. It’s the place to find my latest articles and book releases. Sign up for the mailing list, and it’ll automatically keep you up-to-date!

READ “BANK – Thrilling Adventures on Wall Street” and find out “who killed Charlie Bakkendorf?”

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The ‘Big Long’ Gets Bigger As Goldman And HSBC Gobble Up Tons More Gold

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Summary

Goldman Sachs and HSBC buy up a couple more metric tons of gold – now 9.23 tons and counting.

The Volcker rule does not, and never will, prohibit banks from engaging in proprietary trading in physical gold, silver, or platinum bullion.

The Volcker rule won’t go into effect against big-bank-owned hedge funds until June 2017.

When bank-funded and -controlled hedge and private equity funds are finally subject to Volcker’s rule, it should result in significant upward pressure on the price of bank metals.

What happens next is that the price of bank metals will rise considerably, even in the absence of a collapse of the worldwide bond bubble.

The Big Long was big already. It just got bigger. In the previous article, I noted that Goldman Sachs (NYSE:GS) and HSBC (NYSE:HSBC), had taken delivery of a staggering 7.1 metric tons of physical gold in August, 2015. Since then, they’ve gobbled up tons more.

As of Wednesday, Goldman Sachs bought 142,100 troy ounces (4t 419.8040 kg.) worth of physical gold bars into its proprietary trading account at CME, Inc. HSBC bought a total of 154,800 troy ounces (4t 814.8181 kg.). The two banks have now scooped up approximately 9.23 tons worth of hard metal.

These physical gold bars are headed into the banks’ own vault. That’s what the banks say. They are being purchased as a proprietary trade. That’s what the COMEX exchange says. We know this because commodities regulations require that clearing firms declare the intended ownership of such deliveries.

To better understand what I am talking about, let me explain a few things about how clearing houses work. All clearing brokers who are active at any CME, Inc. exchange, including COMEX, have both a house and a customer account registered with the exchange. The “house account” is the “clearing firm’s proprietary, non segregated trading account.”

You read that correctly. The words are “PROPRIETARY TRADING”! No, they are not my words, but the words…

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The ‘Big Long’ – Goldman Sachs And HSBC Buy 7.1 Tons Of Physical Gold

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Summary

On August 6, 2015, Goldman Sachs, which has issued very bearish forecasts on long-term gold prices, took delivery of a 3.2-ton purchase of physical gold.

On August 6, 2015, HSBC which also claims to be bearish, took delivery of a 3.9-ton purchase of physical gold.

In both cases, the purchases are registered as being for the benefit of the bank’s own house account, rather than the accounts of customers.

Investors should do as the banks do, not as they say.

On August 6, 2015, Goldman Sachs (NYSE:GS) and HSBC (NYSE:HSBC) took delivery of a sum total of 7.1 tons of physical gold. No, I have not made any typographical errors. And no, I am not talking about electronic paper claims. I am talking about shiny yellow metal stuff that you can touch and feel.

The gold bars were not purchased for bank clients. They were purchased for the banks themselves. How do I know this? They are designated by the exchange as being for delivery to the bank’s “house” accounts at COMEX, not to client accounts.

Goldman Sachs, alone, took 3.2 tons worth of physical gold bars. Yet, even as the firm builds its stockpile, Goldman tells clients not to do it. According to Goldman’s Jeffrey Currie, the long-term outlook for gold is bleak.

“In longer term, we definitely like playing this market on the short side. We think we are in a structural bear market, not only in gold, but across the commodity complex, as the individual commodity stories are reinforcing to one another, creating a negative feedback loop.”

In spite of the antics in the paper-gold market, we know the physical market is on fire. Demand will exceed known supplies by at least 1,350 tons in 2015. More in 2016. But, that won’t stop someone from setting up the paper market in order to buy from the physical market very cheaply. This is because the mysterious gold “supplier of last resort” will fill COMEX physical delivery demand, for the moment at least, no matter how high it rises, and no matter how low other supplies may be.

According to HSBC strategists, there has been a…

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U.S. Federal Government Was Covertly Emptying Gold Reserves To Hold Down Gold Prices

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Summary

On June 1, 2015, JP Morgan added almost exactly enough ounces of physical gold to patch the deficiency between supply and delivery demand at COMEX, avoiding widespread dealer default.

Declassified documents, along with strong circumstantial evidence indicate that it was not JP Morgan, but its most important customer, the US Federal Reserve, that just bailed out COMEX.

The deficit in world physical gold supply will be at least 606.1 tons in 2015, but may be much larger, and similar incidents are likely in the future.

The deficit in world gold supply versus demand will grow much larger in 2016 and beyond.

Even if the entire remaining US gold reserves were mobilized, prices could not be permanently held down to current levels, making gold and gold mining stocks a good deal now.

In an article dated June 1, 2015, I pointed out that COMEX clearing members had gotten themselves to the edge of a widespread default on physical gold delivery obligations. They faced net claims of 550,000 troy ounces against only 370,000 registered ounces left at the COMEX warehouses. That left a deficiency of 170,000 ounces, or 5.29 tons of gold.

That same day, JPMorgan Chase (NYSE:JPM) transferred 177,402 troy ounces of gold into COMEX registered gold stockpiles – just enough to cover the shortfall at maturity, plus some extra to cover the additional buying that always happens during an average delivery month. All this raises a question: Did JPMorgan Chase just engage in a bailout similar to John Pierpont Morgan’s 1907 bailout of the New York City banks?

At first glance, it may appear as if JPM bailed out other COMEX clearing members. If you look closer, however, you see something else. The June 2, 2015 delivery report shows that the gold that saved COMEX came from JPMorgan’s house account. Then, after replenishing COMEX registered gold supplies, it delivered 246,800 troy ounces of bank-owned gold, representing 2,468 matured short contracts, as JPMorgan customers purchased and took delivery of 42,200 troy ounces.

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