Rigged Gold Market, a Secret Payoff to China

By Dominique de Kevelioc de Bailleul

As Italian and Spanish 10-year note yields breakout to ‘engine light’ levels of more than 6 and 7 percent, respectively, the China-led BRICS announced at the G-20 in Mexico an additional $95.5 billion ‘contribution’ to the IMF’s emergency bailout fund, with China signing off to $43 billion of the total package.

As renowned historian of economics Niall Ferguson put it on the eve of the Greek election, Sunday, “If there’s going to be a Lehman moment in the crisis it’s going to be next week.”  Well . . . that’s this week.

But, so far, the Lehman-like moment hasn’t arrived and won’t.

Granted, no nation gains from a sudden collapse of the eurozone.   However, China, the biggest creditor of them all, with approximately $3.2 trillion of Western fiat on its books, won’t come to the financial aid of the hopeless European Union (from its own making) without some form of collateral—or maybe a deal, instead, in which something of tangible value could be acquired very cheaply in return for its ‘altruism’.

That tangible central bank asset can only be the coveted asset, most dear as a hedge against the endgame for the dollar—gold!

Though the Fed and its high-profile cheerleaders (billionaire icons Warren Buffett, Charlie Munger and Bill Gates) poo-poo gold’s intrinsic value to dupe/contain the awesome collective purchasing power of the American and European people from entering the tiny gold market in force, the reality of its price rise against every currency for the last 12 years tells quite a different tale.

“Gold is a reserve currency, as far as the market is concerned,” Sprott Asset Management’s Eric Sprott told FinancialSense Newshour’s Jim Puplava in an Oct. 2011 interview.  Sprott went on to say that central banks and the shrewd money know the endgame for the dollar will include gold as the backbone of a new global monetary system—a system that presently finds China sorely lagging in gold reserves when compared with the core EU nations and the U.S.

According to IMF data of 2010, China is way behind, though estimates of China’s real gold reserves reach as high as much as more than 3,000 tons—a still meager amount considering China’s deep central bank reserves.

China, 1,054 tons, 1.8 percent of reserves

United States, 8,133.5 tons, 76.6 percent of reserves

Germany, 3,396.3 tons, 73.7 percent of reserves

France, 2,435 tons, 71.8 percent of reserves

Netherlands, 612.5 tons, 61.9 percent of reserves

Italy, 2,435.8 tons, 73.4 percent of reserves

Spain, 281.6 tons, or 39.2 percent of reserves

Portugal, 382.5 tons, or 89.2 percent of reserves

Greece, 111.7 tons, or 81.3 percent of reserves

And here’s how JP Morgan’s gold suppression scheme works for the Chinese but not the American people (or Europeans).

A rising gold price, or better still, a soaring gold price crashes the dollar (all G-8 currencies) and China’s $3.2 trillion of reserves.  No one wins under that dire scenario except those holding privately-held gold—the castigated tiny group referred to as ‘preppers’.

Moreover, an overt announcement issued by the West to transfer gold to settle payment (the scheme devised under Bretton Woods) after multiple decades of trade deficits would not work either, as years of artificially low gold prices would create immediate and furious front-running by the market, thereby drastically reducing the number of gold-tons China would receive for its fiat, and causing rapid runaway inflation, globally.

Additionally, public outcry of the overt and sudden transfer of wealth from the West to the East would be political suicide to those in power at the time.  For example, the protests among the overall prosperous German people at the thought of Germany pledging its gold to back the EFSF last year was fierce and has caused its president Angela Merkel dearly in the polls.

Therefore, the solution is to covertly transfer gold to China through the LBMA, the Comex or any backdoor available to Western central banks in a gradual manner.  JP Morgan’s trading desk is the mechanism, while the CFTC pretends to investigate the gold manipulation matter to delay further the day of reckoning.

On Mar. 8, Jim Sinclair brilliantly observed that Western central banks know the jig is up for any hope of maintaining the current financial system and plan to prop-up a seriously listing global economic ship for as long as possible before the inevitable revaluation of gold is announced.  In the meantime, China stockpiles gold in preparation of a new gold-backed monetary regime.

“So their [central banks] efforts, in my opinion, are not to depress the price of gold, but to prevent gold from rising into the area where it becomes ballistic,” Sinclair told King World News (KWN).

Sinclair continued by stating that gold will continue to rise enough to prevent a force majeure in the gold market, but the plan by the Fed is for gold to rise in an orderly and stealth manner for as long as possible in the hopes of preventing another post-Plaza Accord (1986) stock market crash of 1987, or an Asian currency crisis of 1997.

“The major players in this game of power need stability for as long as possible,”  Portola Group founder Robert Fitzwilson told KWN, Mar. 19.  “Stability, in this case, is defined as the absence of chaos and absolute panic.”

Commenting on the enlarged pledge by the BRICS out of the G-20 meeting in Mexico, Monday, the US-centric IMF President Christine Laggard told reporters the additional contributions by the BRICS demonstrate “the broad commitment of the membership to ensure the IMF has access to adequate resources to carry out its mandate in the interests of global financial stability.”

She added, “Countries large and small have rallied to our call for action, and more may join. I salute them and their commitment to multilateralism.”

Multilateralism.  Code word for a globally coordinated agenda, which must include a reconciliation of global imbalances and a revaluations of the world’s reserve currencies to achieve that alleged “global financial stability”.

As Western powers dupe its constituencies into holding dollars and euros throughout the crisis, the Chinese have been given red-carpet access to cheap gold through JP Morgan’s price suppression scheme.  As the Chinese buy huge quantities of the yellow metal, JP Morgan helps ‘paint the tape’ for the ‘punters’ and inexperienced money managers, alike, who look for trends to buy into as a momentum trade.  No trend in gold has emerged for nearly one year, giving China that much time to accumulate the gold it needs before the Big Reset.

“Why would the West give China that gold at discounted prices?” KWN’s Anonymous London Trader asks, rhetorically.   “Yes, the bullion banks act on behalf of the central banks to manipulate the price, they act as agents, but the central banks and their agents are also aware that the Chinese are building up their gold reserves. This is the bigger picture which the gold bears do not understand.”

Correct.  But the bears will fully understand the “bigger picture” when the time comes after the Chinese have accumulated enough gold during an orderly bull market in the yellow metal.

U.S. political leaders have outsourced American jobs to China throughout the past two decades, given military technology to China during the Clinton Administration, and now prepare the Chinese for a new global monetary regime at the expense of the American people.  It’s all about “multilateralism,” as globalist Christine Laggard refers to the BRICS’ generosity—and she “salutes them.”

Bill Gates Joins Warren Buffett to Play Joseph Goebbels

The propaganda war against the world’s safest of havens, gold—with a track record of 5,000 years as proof of its role in a monetary system—has taken a step up with the voluntary outing of the latest American copy of the WWII-vintage Nazi Party Minister of Propaganda, Joseph Goebbels.  His name is William (Bill) Gates.

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In an interview with CNBC’s Becky Quick, Gates agreed with Warren Buffett’s negative assessment of holding gold during a financial crisis.

As Gates’ eyes shifted off to the side, he said, “I’m certainly in that camp,” as he proceeded to elaborate in a manner that showed his uncomfortableness with the question and his own response, shifting in his chair several times as he starts off talking about the risks of central banks selling it because it doesn’t “do anything for the people,” and then repeating almost word-for-word Buffett’s sophomoric line about the “psychology” of people buying it because they think it may be worth more in the future.

Here’s the link to the 2-minute clip of Gates’ response to Quick’s question regarding Buffett’s remarks about gold.  Note how he truly struggles with a fabricated response.

Make no mistake it.  Gates’ role is one of a man who finds himself playing a performing puppet for a criminal enterprise, which itself plays the roll of a legitimate Constitutional government.  It appears that Gates must play this role, because the world is too small and his face too well-known to bow out to live in peace on some South Pacific island away from those who would like to remind him of his lifelong commitment to ‘the family’.

Congressman Ron Paul understands the awkward position in which Bill Gates finds himself.  Paul once said of the endless others of Gates’ ilk, all of whom have been seduced by Washington and its suited prostitutes, “When one gets in bed with government, one must expect the diseases it spreads.”  The disease Bill Gates has caught he cannot shake unless he steps out of the pack.  But the pack, in addition to holding a carrot in one hand, also holds a stick in the other.

To better understand Gates and the context behind the disconnect between the reality people feel in their daily lives and the faux reality in which media would like us to believe about almost anything, Republican political operative Karl Rove of the George W. Bush administration shamelessly repackages a Goebbels-ism for a reporter he deemed to be an enemy of Washington power.

From a NY Times Magazine article of Oct. 17, 2004, written by Ron Suskind, who quoted an unnamed “aide” to George W. Bush (revealed later as Karl Rove):

The aide said that guys like me [Ron Suskind] were “in what we call the reality-based community,” which he defined as people who “believe that solutions emerge from your judicious study of discernible reality.” … “That’s not the way the world really works anymore,” he continued. “We’re an empire now, and when we act, we create our own reality. And while you’re studying that reality—judiciously, as you will—we’ll act again, creating other new realities, which you can study too, and that’s how things will sort out. We’re history’s actors … and you, all of you, will be left to just study what we do.”

Washington’s propaganda war, from the war on terrorism, to the invasion of Iraq, Afghanistan, to the virtues of the Federal Reserve, and endless other topics, media is the all-important weapon in the information war between those who report the truth as they believe it to be and those who seek to condition an electorate into thinking against their own self-interests in favor of a few.

In the case of Gates in this instance, he’s merely been called upon to act on the stage at the behest of Washington.  And after reviewing his latest performance, he doesn’t pull it off very well when it’s time to outright lie, because Gates’ entire life has been conditioned to respond in an intelligent and thoughtful manner to complex puzzles.  He’s clearly not gifted at political rhetoric.

After Warren Buffett took a shellacking for his child-like presentation of why he has no gold (he says), Gates, like a drunk trying to save his buddy who was struck by a car while staggering to reach the other side of a busy freeway, will also receive a Chevy bumper to the face in his effort to come to the aid of his friend.

And it’s really of no surprise that Gates would side with the man he “fell in love with” at first sight.  It’s safe to say that Buffett would pooh-pooh Apple’s operating system in favor of Microsoft’s clunker, if push came to shove.

And considering that the two men have in common the burden of being captured by a Washington power structure that aided and abetted both their empires from the jaws of the Sherman Ant-Trust Act of 1880, anyone can clearly see the motivation of both men for going out of their way to discuss that “silly” gold.  Both men would lose a substantial percentage of their fortunes if gold became the foundation of the world’s monetary system.

It’s quite obvious that someone has applied pressure on these two men to play roles each must certainly now feel uncomfortable playing.  How can one of them now buy a billion dollars worth of gold and still cheer-lead the hopelessly broken dollar.  Call it a “deal with the devil” or a simple quid pro quo with Mafia Dons who need to call in that big favor.  Either way, it smells of Nazism dressed in suits.

But the overarching question to this recent spectacle surrounding gold is:  if the yellow metal is so unimportant, irrelevant, barbaric and useless, why do these two men feel so compelled to talk about it?  Shame on both of them.

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