Fed Floods Market with Fake Gold, the Latest Hurdle for Gold Investors

By Dominique de Kevelioc de Bailleul

Tungsten-filled 10-ounce gold bars suddenly have appeared at some of the finest dealers of Manhattan.

No doubt, beginner investors who seek to purchase real money, a real asset, the ultimate safety, have had to overcome decades of carefully orchestrated financial propaganda from the Fed, Washington and academia.  ‘They’ say, the dollar is good, and gold is just a rock, a silly anachronism and an asset useful only to persecuted WWII-vintage Jews.

Then, having cleared the propaganda hurdle, the new class of awakened investors have had to somehow research the gold market long enough to maybe run into articles which discuss the accusations of fraud riddled throughout the paper gold aspect of the market and the manipulation scheme perpetrated by JP Morgan.

What appeared to be an easy way out of the dollar, through a click of a mouse and a few bucks commission on the Scottrade website, may turn out to be more dangerous than holding a debauching currency.

Enter, stage right, comes Jeff Christian, who assures investors that the paper market is on the up-and-up.  The debate between GATA and Jeff Christian kept some investors out of the line to take delivery of real metal, forestalling a bit longer the inevitable and coming stampede into the gold market.

Was GATA an organization spewing ‘conspiracy theories about a gold cartel?

Christian, a suspected shill for the gold cartel, argued that GATA was seeing things, imagining dark-hat bankers ripping off the public with un-backed gold ETFs and bogus short sales of the metal in the futures market.

The case of Andrew Maguire and the CFTC investigation into JP Morgan proves beyond a reasonable doubt that Christian is either a liar, an incompetent or a shill for the Fed.

Christian leaves the stage and CFTC’s Bart Chilton enters.  Chilton, the corn-fed, boy-next-door kind of guy, who grows up to become a heroic fighter of corruption in the financial markets, is the perfect character for the next act to Christian’s ‘Gaslight’ performance.

And the tangible results of the so-called Eliot Ness of Wall Street?  Nothing.  Nearly three years after the CFTC hearings and investigation into JP Morgan, Chilton comes up with zip, furthering the con of the U.S. dollar.  Chilton is now quiet.  He’s done his job for the Fed.  He may leave now.

Now, the poor, confused investor hears that the Fed’s QE-to-infinity policy will further debase the U.S. dollar.  Even some of the ‘big boys’ have come out with recommendations to buy gold.  PIMCO’s Bill Gross and Bridgewater Associate’s Ray Dalio have gone public recently to counter Warren Buffett, Charlie Munger and Bill Gates, the con-job trio billionaire shills for the Fed.

Is it time to buy some physical?  Even the big boys think it’s a good idea.

But wait, the circulation of phony gold bars hits the news, and the companies selling the bars are, of course, the most reputable walk-in retailers of New York.

And the timing of news of the tungsten-filled gold bars couldn’t come at a most fortuitous time for the Fed.  The most recent announcement of QE3-to-infinity policy from Bernanke & Company is a downright admission that the U.S. economy is not responding to previous QEs, unprecedented levels of ‘currency swaps’ and a reflation of the over-the-counter derivatives market.

The Fed needs more help pushing the mob away from gold, because there isn’t enough gold to back all the paper promises saturated throughout the banking system.

“We’re getting closer and closer to the big disclosure that the banksters have stolen the gold, and now they’re flooding the market with fake gold,” TruNews radio host Rick Wiles tells his listening audience of Sept. 24.

Is Wiles spreading another ‘conspiracy theory’?  Let’s ask Christian what he thinks.  Let’s see if Chilton will recommend to the U.S. State Department that it shut down the Chinese company that’s been alleged to have made the phony bars.  Let’s see if Warren Buffett has anything to say.

WikiLeaks drops Bombshell on Gold Market; GATA right again!

With an avalanche of ever-tantalizing news stories and upcoming nail-biting scheduled officialdom events in both Europe and the U.S. all hitting the gold market at once in September, discerning the story that could propel some distance from Jim Sinclair’s exosphere target of $1,764 in the gold price weighs heavily in favor of the WikiLeaks story and its potential explosive impact on the price of gold from today $1,900 print to Sinclair’s ultimate target of $12,000+.

Though the European financial crisis soap opera moves from Greece and Portugal to, now, Italy and Germany, shifting temporarily away from France, with Belgium’s dirty laundry on deck in case there’s a lull in the action, the WikiLeaks release of a U.S. State Department internal cables on the subject of Beijing’s plan for undermining the U.S. dollar through the gold market even trumps the Israel/Turkey potential gray-swan military conflict brewing in the Mediterranean (could ex-CIA operative Robert Baer be right about an Israeli attack in the region by the fall?).

The leaked State Department U.S. embassy cable – 09BEIJING1134, published by WikiLeaks exposes both the clandestine operations at the Fed/Treasury as well as reveals who’s been sleeping with the enemy.

According to China’s National Foreign Exchanges Administration, China’s gold reserves have recently increased. Currently, the majority of its gold reserves have been located in the United States and European countries. The U.S. and Europe have always suppressed the rising price of gold. They intend to weaken gold’s function as an international reserve currency. They don’t want to see other countries turning to gold reserves instead of the U.S. dollar or euro. Therefore, suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar’s role as the international reserve currency. China’s increased gold reserves will thus act as a model and lead other countries toward reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the renminbi.

And now we all know that Beijing knows of the gold suppression scheme, and that Washington knows that Beijing knows of the scheme.  So what does that mean for the gold price?

Zerohedge wrote:

Wondering why gold at $1,850 is cheap, or why gold at double that price will also be cheap, or, frankly, at any price? Because, as the following leaked cable explains, gold is, to China at least, nothing but the opportunity cost of destroying the dollar’s reserve status. Putting that into dollar terms is, therefore, impractical at best and illogical at worst. We have a suspicion that the following cable from the U.S. embassy in China is about to go not viral but very much global, and prompt all those mutual fund managers who are on the golden sidelines to dip a toe in the 24-karat pool.

So, out of the raft of news coming out from across the globe, the WikiLeaks story trumps them all.  And, of course, you won’t see this breaking story run on CNBC.

And now for the story behind the story.  A score between GATA and Jeff Christian of CPM Group needs to be settled once and for all.

Now that this smoking gun evidence of the gold suppression scheme has been entered atop an already sky-high stack, thanks to WikiLeaks, can there now be any doubt left as to who has been spewing filthy misinformation (some say malicious lies) between the combatants of a two-year-long battle between former Goldman Sachs gang member Jeff Christian of CPM Group and Bill Murphy and Chris Powell of Gold Anti-Trust Action Committee (GATA) surrounding GATA’s accusations that the COMEX has been the center of a gold price suppression scheme—a scheme which in still in progress?

But if you’ve already been following GATA’s Yeoman’s work of exposing the gold cartel’s borderline-treasonous gold suppression scheme in addition to exposing the cartel’s no. 1 apologist Jeff Christian for his errant ways, this weekend’s leaked cable should come as no real surprise—which brings us to the question of Christian’s credibility as a gold market analyst and, maybe, ultimately, of his character.

If Christian has positioned himself as an authority on the gold and silver market, how did he not draw the conclusion that something fishy was (still is) going on in the gold futures market between two banks which held monstrous-size paper short positions?  With the pile of evidence backing GATA, coming from so many credible and official sources, we wonder whether Christian had ever heard of the term Occam’s razor?  Or does he suffer from the dreaded “normalcy bias”?  Can he, truly, be that naïve?

Are we to believe that Christian actually could be waiting for an admission of guilt by a pack of sociopath white-collar criminals, or is he that unsophisticated or incompetent? or worse?

Read his Caine Mutiny’s Lt. Tom Keefer testimony at the CFTC hearing of March 2010.

Christian’s sophomoric assumptions on several key issues discussed at the CFTC hearing smacks of either a serious case of Dennis Gartman-itis, or demonstrates the dangers of relying upon the judgment of a public-school graduate deficient in his knowledge of basic ancient and medieval philosophy.  The principle of Occam’s razor, in this case, points to serious questions to Christian’s loyalty to the gold community, its hard-money advocates and the U.S. Constitution itself.

But don’t be surprised if Christian is still asked to appear on Bloomberg or CNBC as a gold “expert” who stands ready to offer his advice for protecting your money.

However, to gain insight into the core issues surrounding gold (and silver) and the reasons why its price must be suppressed by the Fed, GATA’s Web site, www.gata.org, offers the explanations as well as provides a treasure trove of information to help you navigate the ongoing collapse of the West’s fiat currencies.