Many think the gold price will go up after the Ashanti situation is resolved.
October 26, 1999
Midas du Metropole commentary
What kind of market trades like this?
Weeks ago the gold market was in a state of total crisis as overly
hedged gold producers were blowing up and bullion dealer departments
were in total disarray.
Enter mega super bear gold analyst, Prudential's Ted Arnold,
who announced the following to the gold world:
Dow Jones - London - Oct. 11 ----"Central banks are selling gold in
order to prevent a further sharp rise in prices from causing a major
financial crisis. Central banks, according to our sources, have acted
swiftly to prevent a repeat of an LTCM-type of crisis by making sure
that gold prices remain in a tight range. Enough selling is done by
agents of the monetary authorities involved to cap gold. Central bank
regulation of the bullion market ... is a cheap option compared with
the potential cost of bailing out banks and generally injecting liquidity
into an economy if there were a full-blown crisis, he said." End.
That is exactly what our bullion dealer sources have been telling us...
This is the second time in 6 months that the bullion dealers, led by
"Hannibal Lecter" himself (Goldman Sachs) have cried "uncle"...
This recent pummeling of the gold price by "the gold price cappers" will
only exacerbate the short's problems in the end. Demand for physical
gold is soaring around the world and this price set back will only
enhance that demand...
This bear raid has calmed down many bullion dealer concerns. The Ashanti
workout will be easier to accomplish, the Nov. 12, Dec 390 calls look
less likely to be set off and the OTC options that expire tomorrow
morning U.S time have option writers breathing a sigh of relief.
We have just witnessed another bailout of the "big money boys." Power,
influence and corruption wins again. Markets just don't go straight up
out of nowhere, vulnerable market shorts are exposed to the world and
then the market goes straight down. That is just not the way unrigged
markets work!
They will get theirs in the end.
Just a matter of time.
It was almost this time.
..... potentially very positive news out of Switzerland yesterday:
..... await Swiss pols as a balking electorate may give that proposal
a thumbs down too.
There are many "in the knows" that believe this gold sell off is totally
Ashanti related. Here is what we are told. The Ashanti hedge book is
even much worse than most realize. The Ashanti management was fed the
line by the bullion dealers that the price of gold was not going up for
a long time to come. The result: Ashanti's hedge book is full of "Fancy
Dan" structured deal hedge programs.
Word is that the company may be carved up with various gold producers
taking over certain mines. To sweeten the deal, the "Hannibal Cannibal"
bullion dealers are buying calls for Ashanti on this price break. This
will reduce some of the upside exposure that producers will face when
they take on Ashanti's hedge book and juices up the deal for them to
step up to the plate here. I find it of interest that Barrick CEO,
Randall Oliphant, was seen last night having dinner with Ashanti
Chairman, Sam Jonah, at a posh London restaurant....
Many in our camp think that the gold price will go right back up after
the Ashanti situation is resolved. Some of my sources believe that
Goldman Sachs, knowing its rigging days are coming to an end, are going
to reverse and get on the long side. They know what WAS DONE to bring
the gold price down and they know that effort cannot be sustained.
Keep the Faith
Bill Murphy, Chairman
Gold Anti Trust Action (GATA) gata.org
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