Let me start this post by issuing a warning. This post is not an advice on what you should do with your money or banking deposits. I don’t know enough to be an adviser nor do I have the dosh or the gold to issue any but if I was or if I had I would say get the hell out of the paper gold and stock market if you’re still silly enough to be in it. This advice of course would only be to those who like me are not your 1% insider but who like me are part of the 99% who are being scammed by said 1%.
Here are some terms you might want to read up on before you read this post and added to that here are some added banking terms you need to know before you can understand what the hell Dr, Paul Graig Roberts is talking about:
- Paper Gold Market= Other than the bullion Gold market the paper gold market does not deal in real gold. Institutions such as pension funds and Hedge funds who want to own gold more often than not do not want the responsibility and costs of storing real gold and so they buy Shares and or Derivatives in gold stocks. They do this under the assumption that the bullion they buy is a real asset and that if they want to they can take delivery of the bullion as and when it suits them.
- Margin Call= A margin call is the request for added funds if the underlying security you hold devalues beyond a certain point. For example: You buy Gold securities in Gold when the price per ounce is $ 1600. You hope and or expect the price of gold to rise over the next year or so after which you will sell it off at a profit. If the price of gold sinks below that $ 1600 marker you have to compensate for the loss of value in order to be able to hold on to your claim. If you can’t you have to sell the securities you hold representing that gold at the lower price incurring a loss. (This is a very simple representation but for the intends and purposes here it will suffice)
- Stop loss order= If you buy shares for a certain price in the hopes of making a profit when the prices go up you want to protect yourself against the chance that you loose tons of money in case the prices drop. In order to do this you instruct your broker to sell the shares if the price drops below a certain point. Quite common is a percentage of 10% for example.
It goes without saying I hope that these three terms put together with the terms I explain in the article behind the link above represent a situation which if they can be manipulated will be able to cause considerable financial mayhem and loss for the people who are not in on the manipulation and untold riches for those who are.
For example: If an institution would be able to sell a huge amount of paper gold while not really owning it as in a “Naked short” trade it could manipulate the price of gld to the point of forcing people to respond to Margin calls from their brokers and lose a lot of money or it would force a lot of paper gold shares to be sold due to the stop loss orders given to brokers and the price of gold bullion could be greatly influenced to go down while the demand for the real stuff goes up allowing those with real money to buy up real gold for very cheap while the rest of us are forced to give up any claim to it. (No, I don’t own any gold, I invest in heirloom seed to grow food, the stuff you want to buy with real gold when there is no more money)
Well that is exactly what happened over the last month or so and here is what Dr Paul Graig Roberts has to say about it:
There are many signs of gangster state America. One is the collusion between federal authorities and banksters in a criminal conspiracy to rig the markets for gold and silver.
My explanation that the sudden appearance of an unprecedented 400 ton short sale of gold on the COMEX in April was a manipulation designed to protect the dollar from the Federal Reserve’s quantitative easing policy has found acceptance among gold investors and hedge fund managers.
The sale was a naked short. The seller had no gold to sell. COMEX reported having gold only equal to about half of the short sale in its vaults, and not all of that was available for delivery. No one but the Federal Reserve could have placed such an order, and the order came from one of the Fed’s bullion banks, one of the entities “too big to fail.”
Bill Kaye of the Greater Asian Hedge Fund in Hong Kong and Dave Kranzler of Golden Returns Capital have filled in the details of how the manipulation worked. Being sophisticated investors of many years of experience, both Kaye and Kranzler understand that the financial press runs with the authorized story planted to serve the agenda that has been put into play.
Institutional investors who have bullion in their portfolio do not want the expense associated with storing it securely. Instead, they buy into Exchange Traded Funds (ETF) and hold their bullion in the form of a paper claim. The largest, the SPDR Gold Trust or GLD, trades on the New York Stock Exchange. The trustee and custodian is a bankster, and only other banksters are able to turn investments into delivery of physical bullion. Only shares in the amount of 100,000 can be redeemed in gold.
The price of bullion is not set in the physical market where individuals take delivery of bullion purchases. It is set in the paper futures market where short selling can drive down the price even if the demand for physical possession is rising. The paper gold market is also the market in which people speculate and leverage their positions, place stop-loss orders, and are subject to margin calls.
When the enormous naked shorts hit the COMEX, stop-loss orders were triggered adding to the sales, and margin calls forced more sales. Investors who were not in on the manipulation lost a lot of money.
The sales of GLD shares are accumulated by the banksters in 100,000 lots and presented to GLD for redemption in gold acquired at the driven down price.
The short sale is leveraged by the stop-loss triggers and margin calls, and results in a profit for the banksters who placed the short sell order. The banksters then profit again as they sell the released gold into the physical market, especially in Asia, where demand has been stimulated by the sharp drop in bullion price and by the loss of confidence in fiat currency. Asian prices are usually at a higher premium above the spot prices in New York-London.
Some readers have said “don’t bet against the Federal Reserve; the manipulation can go on forever.” But can it? As the ETFs such as GLD are drained of gold, their ability to cover any of their obligations to investors diminishes. In my opinion, these ETFs are like a fractional reserve banking system. The claims on gold exceed the amount of gold in the trusts. When the ETFs are looted of their gold by the banksters, the gold price will explode, as the claims on gold will greatly exceed the supply.