(GATA News) Goldbird1, the "Deep Throat" of the gold resistance.
Le Metropole members,
Midas du Metropole has served commentary at The James Joyce Table.
Midas Special
January 9, 2000
The last several days have been loaded with GATA related activity,
correspondence, wire releases etc. It is clear that GATA is making
progress towards our goal of finding out the truth about what
is REALLY going on in the gold market and exposing that truth to
gold market participants, the public, the U.S Congress and the press.
As you read this Midas, it will become very clear to you that all of our
efforts continue to pay off. Frankly, it is tedious hard work. Not that
much different than a detective trying to find the conclusive evidence
to solve a crime. It is not glamorous - it is time consuming as many
of you know that are out there helping us. And, there are many of you,
for which we are very grateful.
On that note, Chris Powell, my GATA co-founder and Treasurer/Secretary
deserves a special pat on the back. He has been working tirelessly
behind the scenes (on his own time and without any compensation)
and as you will ascertain below, he has been especially effective.
As you read the following correspondences, please keep in mind that
we view all them with the Clinton Administration "is" principle in mind.
You know - what does "is" mean?"
Until we close all the wiggle room loopholes, we will not be satisfied
with answers from the Federal Reserve or Treasury; otherwise, they might
come back at a later date and say, "well, you never asked us that question!"
As many of you know, GATA asked certain questions to Alan Greenspan
and Lawrence Summers in an open letter in RollCall on December 9, 1999.
Chris Powell had been working with Senator Dodd prior to that time
and had previously asked other questions.
He just received the following:
DEPARTMENT OF THE TREASURY
WASHINGTON, D.C. 20220
January 7, 2000
The Honorable Christopher J. Dodd
United States Senate
Washington, D.C. 20510 - 0702
Dear Senator Dodd:
Thank you for your letter concerning questions from Mr. Chris Powell,
Managing Editor of the Manchester Journal Inquirer, regarding the
Federal Reserve Board and the Department of the Treasury.
Enclosed you will find responses to Mr. Powell's questions as they
pertain to the Department of the Treasury.
If Mr. Powell needs clarification, or has further questions, he should
contact Mr. Longbrake in our Public Affairs Office at...
Sincerely,
Michelle A. Smith
Deputy Assistant Secretary
(Public Affairs)
DEPARTMENT OF THE TREASURY
Office of Legislative Affairs and Public Liaison
1500 Pennsylvania Avenue, N.W.
Washington, D.C. 20220
To: Chris Powell
From: M. Levine
Comments: Senator Dodd's office asked us to fax responses to our questions
directly to you. Sorry about the delay in getting these to you.
Questions Regarding the Federal Reserve Board
and the Department of the Treasury
From Chris Powell, Manchester Journal Inquirer
Q1: Do the Fed or the Treasury try to influence the stock, bond
commodities and gold markets? If so, how?
A: The Treasury Department does not make any attempt to influence the
stock, bond, commodities or gold markets.
Q2: Do the Federal Reserve and the Treasury Department have a policy
toward the price of gold? If so, what is it?
A: The Treasury does not have any policy regarding the market price of
gold. The Mint, however, pegs the price of the Golden American Eagle
coin according to the London Metal Exchange base price. The charge for
the coins are LME base +3% for 1 ounce, +5% for 1/4 ounce, +9% for 1/10
ounce and mints to demand. Prior to 1971, however, the Treasury pegged
the market price of gold.
Q3: Do the Fed or the Treasury trade in any financial instruments
besides U.S. government bonds? If so, which ones and what do the Fed and
the Treasury try to accomplish with their trading?
A: The Treasury Department does not trade Treasury securities.
The Treasury only conducts issuance activities in Treasury securities
and is considering whether to buy-back its securities in the market.
In rare cases where the government receives securities, the Treasury's
Bureau of the Public Digest engages a third part agent to sell the
securities (see the answer to 7, below).
Q4: Have the Fed or the Treasury used foreign central banks, foreign banks,
or foreign accounts over which they have custody or influence, or the
Exchange Stabilization Fund to intervene in the stock, bond, commodities
or the gold markets?
A: The Treasury does not use foreign central banks, foreign banks,
foreign accounts or the Exchange Stabilization Fund to intervene
in the stock, bond, commodities or the gold market.
Q5: Do the Fed or the Treasury trade in gold or in securities, futures
contracts, or options that are related to gold, or otherwise seek to
influence trading in gold? If so, how?
A: The Treasury Department does not trade in gold or futures contracts
in order to influence the trading in gold.
Q6: Do the Fed or the Treasury lend or lease gold? If so, whose gold is
it, where does it come from, for what purpose is it lent or leased, and
under what terms is it lent or leased?
A: The Treasury Department does not engage in the lending or leasing of gold.
Q7: Do the Fed or the Treasury have or control brokerage accounts?
If so, with which brokers, and what sort of trading is done with each?
Where do the money and securities deposited with these brokers for the
Fed's and the Treasury's accounts come from?
A: The Treasury Department maintains a brokerage account at Leggs Mason
Wood Walker, Inc., in order to liquidate securities holdings that come
into possession of the government. This facility is managed by the
Bureau of the Public Debt and receives securities from any government
agency to be sold. These securities may be received as gifts, as settlements,
payments, etc. The only securities in this account are those awaiting sale.
The Treasury does not conduct any purchasing activities through this account
and does not have a portfolio account at any brokerage firm.
[End.]
You will note that this Treasury official says nothing about the Federal
Reserve and in answering question 5, leaves out any mention about options
in her answer. Leaving out "options" is a glaring omission.
GATA supporter, Michael Bolser, received the following from another
Treasury official through his Congressman, Charles Canady.
They are the same answers.
Dear Mr. Powell:
I have received an official Treasury Dept. response through my Congressman,
Charles Canady.
It is on letterhead, Dec. 17, 1999 and signed by Linda L. Robertson,
Assistant Secretary Legislative Affairs and Liaison.
You should know that her responses mirror those previously provided by
the Federal Reserve working committee. She issues blanket denials to
each of the six questions. Here are some highlights for your review:...
Chris, I now have documents [as I expect you do also] from the Federal
Reserve and the Treasury Department which essentially deny involvement
in what GATA asserts is Anti-Trust activity.
These two positions from two government agencies are unequivocal statements
of denial made to a US Congressman on behalf of his constituent--me.
If you need copies of the correspondence, let me know.
If there has been action designed to influence the price of gold by the
federal government, then there is also a significant cover up underway
as well.
Goldbird1, the "Deep Throat" of the gold resistance, needs to beam even
more light and heat on the specifics of everyday trading manipulations.
As the momentum builds in this story, it will be his and other's informed
leaks that confound and hamstring the opposition.
Kindest Regards,
Michael Bolser
HOT OFF THE PRESS:
I just called up Michael Bolser to ask him about the Federal Reserve document
that he referred to. I was NOT aware of one, so he faxed it to me.
It starts out with and reads:
Board of Governors
Of The Federal Reserve System
Washington, D.C. 20551
November 12, 1999
The Honorable Charles Canady
House of Representatives
Washington, D.C. 20515
Dear Congressman:
Thank you for your letter of October 22 in which you requested answers
to questions you received from your constituent, Mr. Michael Bolser,
concerning various policies of the Federal Reserve and the Department
of the Treasury.
I have enclosed a staff memorandum responding to the questions regarding
the Federal Reserve. Please let us know if we can be of further assistance.
Sincerely,
Winthrop P. Hambley
Deputy Congressional Liaison
Enclosure
(The following enclosure was not written on Board of Governors stationary
- it was typed up on blank stationary)
Staff Memorandum
Board of Governors of the Federal Reserve System
November 1999
Do the Federal Reserve Board and the Department of the Treasury have a
policy toward the price of gold? What is the policy?
The Federal Reserve does not have a policy toward the price of gold.
Do the Federal Reserve Board and the Department of the Treasury trade in
gold or securities, gold futures, or gold options, or otherwise
influence trading in gold?
The Federal Reserve does not trade in gold or gold securities, gold
futures or gold options. Likewise, the Federal Reserve takes no action
designed to influence trading in gold.
Do the Federal Reserve Board and the Department of the Treasury trade in
any financial instruments besides U.S. government bonds? If so, which
ones and what do the Fed and the Treasury try to accomplish with their
trading.
Virtually all of the Federal Reserve's trading activities relate to U.S
government securities. The Federal Reserve buys and sells U.S.
Government securities in the open markets (open market operations) in
order to implement monetary policy. The Federal Reserve conducts such
transactions in U.S. government securities both on an outright basis and
under repurchase agreements. In addition, the Federal Reserve very
recently has sold options on repurchase agreements in U. S. government
securities to help address concerns in financial markets associated with
the century date change.
From time to time the Federal Reserve, in cooperation with the
Department of the Treasury, conducts operation in foreign currency. The
purpose of these purchases and sales is to counter excessive pressure on
the international value of the dollar. The Federal Reserve also carries
out transactions in the U.S foreign exchange market as an agent for
foreign monetary authorities.
Do the Federal Reserve Board and the Department of the Treasury have or
control brokerage accounts? If so, with which brokers.
The Federal Reserve has no accounts with stock brokers.
The Federal Reserve's transactions in government securities are
conducted primarily through the book-entry system that the Federal
Reserve maintains on behalf of the Treasury. In the book-entry system,
depository institutions (such as commercial banks) maintain accounts
with their local Federal Reserve Banks. These accounts record the
ownership of the securities by their ultimate owners. In addition, the
Federal Reserve maintains government securities accounts as the two
major U.S. banks that are active in providing clearing services in U.S.
government securities, the Bank of New York and Chase Manhattan Bank.
Do the Federal Reserve Board and the Department of the Treasury try to
influence the stock and commodity markets? If so, how?
The Federal Reserve does not try and influence the stock and commodity
markets. The Federal Reserve's statutory objectives in conducting
monetary policy are maximum employment, stable prices, and moderate
long-term interest rates. Of course, changes in the stance of monetary
policy, and even public comments by Federal Reserve officials regarding
monetary policy or economic conditions, affect markets, including the
stock and commodity markets. For instance, a tightening of monetary
policy designed to reduce inflationary pressures would likely reduce
stock and commodity prices, other things equal.
Do the Federal Reserve Board and the Department of the Treasury lend or
lease gold/ If so, to whom and for what purpose?
Under the Gold Reserve Act of 1934, title to any gold acquired by the
Federal Reserve is vested in the Department of the Treasury.
Accordingly, the Federal Reserve Board has no holdings of gold that
could be lent or leased and does not engage in any such transactions.
[End.]
These answers are in much greater detail than we obtained from the Treasury,
but they still leave wiggle room. For example, the last question does not
say whether the Federal Reserve lends gold in behalf of the Treasury.
It just says that they don't lend gold that they don't own. In addition,
we have not asked the Fed/Treasury about "forwards," so naturally they
have not answered that one, yet.
In the weeks and months ahead, we hope to have all our questions answered.
If the Fed and Treasury deny any active involvement in any way, shape,
or form, they are either lying or telling the truth. If they are telling
the truth, then the bullion dealers cannot use a Federal Reserve/Treasury
defense to say they manipulated the gold price at the instructions of
the Federal Reserve/Treasury. That has been a worry of ours over the
past year and the Fed/Treasury maybe closing that excuse door for some
of the bullion dealers down the road. Unless, of course, they are not
giving us the straight scoop, in which case we will hold the Fed liable
for damages.
The more questions we ask, the more answers we get, the closer we get to
proving what players are really behind the orchestration of low gold prices.
Concrete smoking gun evidence is out there.
We will find it.
The hoopla these past few days does not end there. On Friday, the staff
director for Sherrod Brown, a member of the House of Representatives in
Ohio, called to ask me how we were getting along and what was the status
of our potential legal course of action. This staff director, Dave Savolaine,
was up to date on the Peter Hambro Bank of England/UK Treasury correspondence,
the Roll Call open letter to Alan Greenspan and Secretary Summers, etc.
He asked me to keep him informed of any significant news on our end.
Sherrod Brown's main interest is health care, but MANY of his constituents
have been flooding him about the GATA questions and the issues we are raising
about the gold market. Congressman Brown and Dave Savolaine were responding
to the voters in their district. Very impressive and nice going Cafe members
out there. Your efforts are paying off. This is evidence that we can all make
a difference as time goes by.
Then yesterday, Bruce's Meadow sent GATA the following Reuter's wire
about Secretary Summers. Our presence is being felt and the press is
finally starting to ask questions.
Summers Says U.S. Not Selling Any Gold Reserves
Filed at 11:24 a.m. ET - January 8
By Reuters
BOSTON (Reuters) - The United States has not sold any of its gold reserves
and has no plans to do so, U.S. Treasury Secretary Lawrence Summers said.
"I categorically deny assertions that U.S. gold reserves were being
sold off or that there is any plan to sell them off," Summers told
reporters on the sidelines of an economics conference.
His denial came amid talk in the gold markets that some of the weakness
in the gold price over recent years may have been caused by direct U.S.
sales of gold.
The International Monetary Fund, for its part, has begun to sell
its gold to raise cash to pay for debt relief for some of the
world's poorest nations. But the gold never actually reaches the
market place: In a complicated transaction, the fund sells its gold
at market prices to member countries that owe it cash. The members
then use that cash to repay their obligations to the fund.
The deal creates windfall profits for the IMF because, under a quirk of
international finances, IMF gold is valued at some $48 per ounce, while
the market price is around $285.
The idea of off-market gold sales was hatched as a way to placate those
who feared that direct sales of IMF gold could drive prices lower and
hurt the very countries the debt relief is designed to help. Some poor
debtor countries are also gold producers.
[End.]
The following AP release suggests that Martin Armstrong has a rough go ahead
of him. Previous to this release, his attorneys were ordered to return the
money they received from Armstrong, or his firm, in preparing a defense.
Now, he must turn in $16 million of his personal assets.
I don't have a clue what the real story is here, but it disturbs me
greatly that the government is taking away the man's right to defend
himself without proper legal representation. Good lawyers have to be
paid. This has to be an incredibly complicated financial legal case.
A public defender would have to study finance for a year before he,
or she, could be of any help to Armstrong.
What is worse is that I suspect the government is doing all this on
purpose so that the bullion banks, such as Republic Bank, do not get
their records subpoenaed. It would appear the government wants to
smother any chance Armstrong has to bring facts out into the open that
might go against the big money N.Y. crowd.
First, Safra was silenced. I mean really silenced!
Is that the big boys way of neutralizing Armstrong?
The United States of China at work once again when it comes to going
against the cronies of the establishment.
Friday January 7, 7:04 pm Eastern Time
Market Guru Ordered To Return $16M
NEW YORK (AP) -- A judge on Friday ordered renowned market forecaster
Martin A. Armstrong to produce $16 million of gold bars and rare antiquities
in an attempt to recover the assets of investors who were bilked out of about
$1 billion.
Armstrong, 50, founder of Princeton Economics International, violated
a court order to turn over the valuables to a court-appointed receiver,
Judge Richard Owen in the U.S. District Court in Manhattan ruled.
The judge ordered him to produce them by Tuesday at 3 p.m.
Prosecutors believe Armstrong has 102 bars of gold, a $750,000 bust
of Julius Caesar, hundreds of rare coins, a bronze helmet and other
antiquities.
In addition, Armstrong's ex-girlfriend, Tina Mustra, who also is his
executive assistant at Princeton Economics, testified Friday that she
helped Armstrong remove company records from their Princeton, N.J.
offices shortly before they were raided last September by FBI agents.
"The testimony of Ms. Mustra (supports) that Mr. Armstrong has been
personally involved in the taking and secreting of these items,"
Judge Owen said in signing his order.
On Thursday, attorneys for the receiver searched Armstrong's spacious
vacation home in Long Beach Island, N.J., but said it had been cleaned out.
Behind some books on the top shelf of a bookcase, they found a bar of fine
Swiss silver, they said. They also found some packaging for antique coins,
complete with auction slips, and two small coins.
"It is overwhelming evidence coins are in his possession," said Alan Cohen,
an attorney for O'Melveny & Meyers and the receiver in the case.
Armstrong, who is free on a $5 million bond, had no comment following
the hearing, but his attorney Lawrence S. Feld said, ``Mr. Armstrong has
authorized me to say that he will turnover whatever is in his possession.'
Had Armstrong not signaled that he was willing to comply, U.S. Marshals
were standing by to arrest him.
Armstrong has pleaded innocent to charges of fraud brought by the
Securities and Exchange Commission, the Commodity Futures Trading
Commission and the U.S. Attorney.
Armstrong owes almost $1 billion to some 100 Japanese corporate investors.
His companies, including Princeton Economics and Cresvale International Ltd.
in Tokyo, had raised money from investors and promised to repay the debt,
plus interest.
Instead of investing the money in safe bonds, as he promised, Armstrong
made risky bets on currencies and derivatives. Only $46 million has been
recovered to repay investors.
Cresvale filed for bankruptcy last month and its chairman, Akira Setogawa,
was indicted for tax evasion. Setogawa also has admitted giving rebates
to Japanese companies who continued to invest with Armstrong.
[End.]
How bad is the stench in the gold market?
The following is a Kitco comment that was emailed to me:
Date: Fri Jan 07 2000 01:48
GO GOLD (Ashanti news) ID#428144:
Copyright 1999 GO GOLD/Kitco Inc. All rights reserved
I was lucky enough to spend some time over Xmas with a Standard Bank
employee who told me that as primary lender to Ashanti, they were very
close to going under. The bank that is. If the BOE had not stepped in to
underwrite Standard, in return for them not calling in their debts from
Ashanti, then Standard would no longer be around. Standard had no option
other than to comply, since the BOE made it clear that they would have
had to have stood in line with other creditors, and they would never get
all there money back.
Now, why would the BOE involve itself in corporate issues like this
unless they were sh*t scared of Ashanti not being around any more to
deliver that lovely gold into the market?
I just think the whole thing STINKS.
I just cannot believe that the powers that be out there are quietly
manipulating the market while publicly and very loudly pushing the
open and free markets.
What a bunch of A***HOLES!!! I eagerly await their downfall.
[End.]
That very same day, a Cafe member told me that he heard that Barrick Gold
is going to move in on the significant assets of Ashanti and that
announcement would be forthcoming in the next couple of weeks.
The same Cafe member told me he felt that is why the gold price has been
ratcheted down once again. Goldman Sachs wants this deal consummated to
get it off the hook as it has received horrendous conflict of interest
publicity - even from the likes of the FT in London. To do so, they need
the price of gold lowered so that some short covering can be done on
Ashanti's behalf.
My feelings for Barrick Gold are well known to all of you. They are
louses of the first order and one of the worst examples of industry
leadership in the history of corporations. Their excess hedging
strategies and complicit relationship with bullion dealers such as J.P.
Morgan and Goldman Sachs is causing untold suffering to so many in the
gold industry. Their executives go around and brag how great they are,
yet while many corporate stock prices are making new highs around the
world day after day, Barrick's share price is mired right above 52 week
LOWS at 17 and change. Very impressive!
Goldman Sachs was lead advisor to Ashanti. On Friday, Bridge News
reported the following from Accra, Ghana:
"The group treasurer of Shanti Goldfields company has quit her job,
in the wake of the company being wrong-footed late last year in its
forecast of the world gold price. Mona Caesar-Addo, 37, who was in
charge of the company's hedging activities gave a month's notice
of her resignation on November 30 and subsequently left with the
entire treasury staff, Bridge learned today?.."
Love to chat with this widowed mother of two, Ms. Mona Caesar-Addo,
sometime. I wonder what she has to say about the advice Goldman Sachs
gave her right now.
The Barrick/Ashanti story is only what I hear from a good source.
Will be interesting to see if it plays out.
Rap up (as in Rap Talk, not wrap up as in close the box). The gold loans
are around 10,000 tonnes, the monthly supply/demand deficit is around
150 tonnes per month, the big gold shorts are trapped, gold demand
is running at record levels, bond yields are soaring due to inflation
fears, base metals have risen sharply, the economic story of the day is
"global economic growth" and that is superb news for present and future
gold demand, and the U.S. money supply has expanded dramatically.
All this and the gold price goes nowhere to lower. It is being
manipulated and orchestrated lower. Period. How clear can that be?
The good news is that the perpetrators of this fraud are slowly being
found out. As each month goes by, they run out of future massive sources
of supply to hold the gold price down. It is only a matter of a little
time before they do run for the proverbial "them thar" hills and the
price of gold begins to seriously advance towards its fair equilibrium
price of $600 per ounce.
Bill Murphy ( Midas )
The above mention of GATA is as follows.
Bill Murphy, Chairman, Gold Anti Trust Action (GATA) gata.org
Also, GATA related articles can be obtained at the pay for view site.
Bill Murphy, Le Patron, Le Metropole Cafe lemetropolecafe.com |
