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Tuesday, October 13, 2009

 

"Central Banking: A Blight On Humanity

"Central Banking: A Blight On Humanity

-- Posted Friday, 9 October 2009  
Source: GoldSeek.com
By: Rob Kirby

"Impeccably reliable sources have informed me that as recently as Sept. 30, 2009 – the last possible day of trade in the Sept. 09 gold futures – a number of well-heeled market participants “bought” substantial tonnage worth of gold futures on the London Bullion Market [LBMA] and immediately told their counterparties they wanted to take instantaneous delivery of the underlying physical bullion.

The unexpected immediate demand for substantial tonnage of gold bullion created utter panic in at least two banks who were counterparties to this trade – J.P. Morgan Chase and Deutsche Bank – because they simply did not posses the gold bullion which they had sold short [an illegal act which in trading parlance is referred to as a “naked short”].

Because these banks did not have the bullion to honor their contracted commitments, one or both of them approached the counterparties and asked if there was any way they could settle this embarrassing matter quietly on a “cash basis” to absolve the banks from fulfilling their physical bullion delivery obligations.  The purchasers were not interested in a ‘cash settlement’ and demanded delivery of physical bullion giving these banks 5 business days to resolve the situation.  A premium of as much as spot plus 25 % [that would be 1,250 – 1,300 per ounce of gold] was offered to settle this matter in fiat money instead of the embarrassment of a very public “failure to deliver” on the part of the London Bullion Market Association.

Earlier this week, no less than two Central Banks became involved in effecting the physical settlement of this situation.  One of these Central Banks was British [that would be the Bank of England] – and reportedly, even they were only capable of providing less than pure, non-compliant gold bars that did not meet good delivery standards stipulated by the LBMA.  Like it or not, this is a testament to lack of physical gold available, folks.

To summarize: Banks like J.P. Morgan Chase and Deutsche Bk. - who sold endless amounts of gold futures at prices of 950 – 1025 and then tried to make “side deals” with the folks they sold the futures to – offering them spot + 25 % [let’s say 1,275 per ounce] to settle in fiat – only after their counter parties demanded substantial tonnage of physical gold bullion.

Stunningly, if accurate [and there is absolutely no doubt in my mind that this is not accurate], this means that gold is already in SEVERE backwardation and this fact is being hidden from the public.

Then, to protect the “integrity” of the futures market as a ‘price discovery mechanism’ – Central Banks – aiding and abetting - plunder the sovereign assets of their respective countries to bail out their agents / friends in an attempt to ‘sweep the whole bloody mess under the carpet’.  

To think that anyone wonders why our financial system and fiat money will soon to be TOAST?

What a disgraceful insult to humanity."

http://news.goldseek.com/GoldSeek/1255111200.php


Comments:
I was thinking about this the other day if the United States went back on the gold standard for currency backing. Is the gold still in Fort Knox? If it is the gold was placed there at a value of about 20.00 an ounce. Now with gold at about 1,000 dollars what is the value of the gold in Fort Knox in dollars?
In a pinch, the exchanges will just change the rules (again) or declare 'force majeure'. The littlest guys (who believe the lies) will get paid in paper, if at all.

Thanks JAP! Believe I've heard comments on talk radio there is no gold in Fort Knox, however haven't seen any credible verification about that. Like you I'd like to see us go back to the gold standard.

Deferring to Sci-Fi, wish we could 'materialize' what we need out of thin air making money irrelevant .... then watch bankers self destruct. Best show in town.
Thanks Time*treat! I'm wondering where all the 'gold for money' is going when smelted back down. Have you read anything about that?

The gold in Fort Knox on 10/11/2007
As of today (10/11/2007), the currently approximate value of the gold ($749 per ounce) is $110,327,700,000... That's ~110.3 billion for those who may be numerically challenged.

As of the price being 1,000 an ounce todays gold in Fort knox is $147,300,000,000 or 147.3 billion
Thanks JAP! At least there was some there in '07, which is much better than I thought.
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