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Politics : Welcome to Slider's Dugout

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From: michaelrunge	1/9/2008 2:01:48 AM
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Taken from Investor Village... -Mike Adrian comments on the GS - Gold situation It is very clear that the Goldman Sachs call to their clients to short gold in 2008 was a complete set-up. Looking at the deliveries on the TOCOM I found that Goldman Sachs took delivery of 5.5 tons of gold from TOCOM in December. They at one point in December had a long position of over 500 contracts. I had assumed that they had sold this position when it disappeared from their daily reported position but it is now clear that they stood for delivery. That tells me the Cartel is desperate for physical gold. Their usual source of metal is the dark, opaque world of Central Banks where no one knows where it came from. The fact they are now dredging the depths of the exchanges implies that supplies are very tight. The other aspect of this story is that Goldman recommended to their clients that they short gold while they themselves took delivery of 5.5 tonnes!!!…and that is only a trade that we know about! They have also been aggressively reducing their short position on the TOCOM for 18 months from 56,000 contracts short to 8000 contracts. A source has reported that GS has had "a lot of bad luck recently and they have been on the wrong side of many trades". He says that they have been sending "mea culpa" letters to clients. I don’t buy it that GS has been on the wrong side of those trades. All this means is that Goldman clients have been on the wrong side of the trades and I wouldn’t mind betting who was on the winning side of the trade! Out of all the supposedly smart bankers only Goldman Sachs managed to be "short" the sub-prime mortgage market! If anyone thinks they have been blind sided by this gold move they need to think again. Goldman has their own man running the treasury and many others in government. I am willing to bet that Goldman Sachs does not have a portfolio that looks anything like what they are recommending for their clients. When the FED organized a bailout of LTCM and let the investment banks see the confidential positions that LTCM was holding Goldman Sachs used that information to bet against the LTCM positions! This move in gold is going to be massive and surprise even many of the bullish observers. Goldman Sachs knew it was coming. They are not going to be on the hook…which means that the Central Banks are the Losers of Last Resort. This is going to be exposed by GATA in grand style very shortly in Washington. Cheers Adrian

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