KB,
Thank you very much. We acknowledged Adrian and sent him our commentary. This is my latest email after the events of the day.
Le Metropole members,
Last night, in the Midas du Metropole commentary
at the James Joyce Table ( as many of you know ),
I went over the supply/demand situation of the gold
market, as I saw it.
If you recall, it was clear from the commentary that
the bears were running out of ways to talk down the
market and the price of gold had risen to a point that
the gold leasers ( with their 3,000 tonnes of borrowed
gold ) were in danger of seeing these leases begin to
"go underwater" ( from a principal payback standpoint ),
if the price of gold were to get much above $290.
We told you that Goldman Sachs, Chase Bank and Deutsche
Bank ( among other bullion dealers ) were heavy sellers
yesterday, and that Deutsche Bank has been an especially big
seller the past 3 days. Deutsche Bank was also out telling its
clients yesterday that the price of gold WOULD NOT GO
ABOVE $290. Now how would they know that?
The XAU was soaring. Bond yields were rising sharply and
broke an 18 year down trend line. The Australian Gold Index had
its biggest move up in 6 years on Friday. Alan Greenspan
also spoke publicly of potential U. S. inflation pressure.
We suggested it looked to us that new spec longs had entered
the gold arena to take on the gold leasing crowd. We insinuated
that the bullion banks had created a big problem for the
central banks by encouraging too much gold borrowing at virtually interest free interest rates ( 1% ) to invest in the markets.
"The savants were making a fortune at the expense of the gold miners,
gold producers, gold shareholders and those that believe in
free markets".
Central bankers, like Alan Greenspan, use the gold price and
the gold market's behavior as a report card of sorts on how
they are doing. A sharply rising gold price might suggest that
that their central banking policies are not "sound".
The bond market vigilantes will not let anyone mess around with
what is the real story and the bond market ( 5.81 long bond yields )
tells us inflation is right around the corner. A rising gold
price right now would be the "clincher" that the central banks
might have a "tiger by the tail", and that their policies
might not be as "Godlike" as they are perceived today.
So what to do? The big bullion banks ( who would be in serious
trouble if the price of gold were to move up ) and Alan
Greenspan, with his "don't prick the stock market bubble",
attitude, send out a distress call to "THE ENGLISH POODLE",
The Bank of England and the British Treasury. Today, they
announced that they plan to sell 415 tonnes of their gold
reserves. I will discuss this in greater detail in the next
Midas du Metropole in a piece called "Scandale Gold 3".
To no one's surprise, the gold market was blasted today and
the XAU, which was roaring, was hit very hard. And of course,
Chase, Goldman Sachs were the big buyers around the lows today.
The colluders cleaned up again. They took more of the futures
crowd's money, your money if you are a gold shareholder, the
gold producer's revenue,etc. And, of course, they further
demoralized a demoralized industry.
Yesterday, we also suggested someone was messing with silver
in the OTC market because they wanted to make a precious metals
market look sloppy. Today, that same crowd covered after many
other spec longs panicked some 18 cents lower at one point.
Silver clawed its way back today and eventually closed 5
cents HIGHER. No need to hold silver down with the price of gold
headed towards Hades.
Yes, or course, we are mad as hell and are not going to
take it anymore. Enough is enough.
The good news is: the bears are in deep doo doo. They are
so desparate they had to ask the UK citizens
to dump gold at ludicruosly low prices to bail out
the bullion dealers ( P.S. Hail Brittania-"good people
of England-you will be hearing from us soon via the press".
GATA is ready to move into high gear. Today, the Financial
Times of London called, the Canadian Broadcasting Company
called, the Mining Journal called and 3 wire services called.
And, Aaron Task of thestreet.com did a story
about GATA which was posted this afternoon. We thank him for
taking the time to look into what we have to say. If you
are interested in the gold market, or are a GATA supporter, I
think you will like this read.
I will have much more to say in the next Midas at
lemetropolecafe.com, but if you are a newcomer, you
might want to get some background of what GATA is up to by
reading about my trip to see 3 Congressional committees. It is
served at the Matisse Table.
GATA needs your support. We intend to expose to Congress what
these manipulators are doing and to continue to alert them
to the financial "systemic risk" danger that they are
creating. Your contribution, if you care to make one, can be confidential. If you cannot support us financially, send
this around the internet so that the word will be spread
all over about what is really going on in the gold market.
If you already are a supporter, we thank you very much. Your
contribution may be one that someday could be considered to
be "historic".
Every major gold producer has been sent 5 letters by GATA.
We are going to call everyone of them next week to ask them
to support their own interests by supporting us. Three of
the biggest gold producers in the world just commissioned
a consultant ( with a fat fee ) to do a study on the
spec derivative market. We are not doing a study- we are
confronting the enemy and going to the Congress of the
United States of America and alerting them to the potential
danger that is now lurking out there. This is real life, no
study, and the 3 Congressional committees that we met with
want to hear all we have to say. We are going to ask every
major producer to consider what we are trying to do for them
and will ask them for substantial support.
As far as the junior gold mining companies are concerned,
it is our hope that every one of them will buy ( or have
a shareholder buy ) one of the limited edition
GATA prints by Absolut Vodka artist, Alain Despert. They are
only $500 plus shipping. For your information, the prestigios
Fairmont Hotel in Dallas, Texas is setting up a gallery to
exhibit Alain Despert's art.
What a day! Discouraging, but encouraging. We received word
from all over the world today that the mining industry
is getting ready to support our efforts because it is now
clear to so many of them that "in so many respects" GATA's
assesment of "what is what" is right on the money.
Le Metropole Cafe
All the best,
Bill Murphy
Le Patron
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