Study reveals gold markets were rigged by Western banks. Surprise!

[NVMojo]

This is significant, folks. Check out the GATA website for more info on this case ...

http://www.gata.org/

Dubai Study Endorses GATA's Findings on Gold Market Rigging, Warns Oil Producers

DALLAS--(BUSINESS WIRE)--March 3, 2005--A study published by a research foundation in Dubai has endorsed the Gold Anti-Trust Action Committee's findings that Western central and commercial banks have rigged the gold market but have much less gold than they claim to have and so are vulnerable to rising demand for gold. The study recommends that the oil-producing countries of the Middle East diversify their ever-depreciating U.S. dollar holdings into gold.


The study, "The Role of Gold in the Unified Gulf Cooperation Council Currency," was written by Eckart Woertz, vice president of CFC Securities in Dubai, for the Gulf Research Center. It quotes the work of GATA's consultants, including Frank Veneroso, and predicts that the gold price suppression scheme of the Western banks will fail just as their similar scheme of the 1960s, the so-called London Gold Pool, failed when the drain on Western gold reserves became too great. Once the scheme fails, the study says, "it will be highly difficult and expensive to accumulate a gold reserve. This is especially true for central banks that have low gold reserves like those in the Gulf Cooperation Council countries."

The study concludes: "The paper dollar standard is a dead man walking. Its debt, accumulated over the recent decades, is too high to be effectively repaid. It will either default or be inflated to such an extent that it will not 'hurt' to pay it back. Therefore, the accrued imbalances in global finance and the inherent weakness of worldwide growth models that rely on a continuance of U.S. deficit spending are likely to usher in a serious crisis of currency systems in coming years.

"Gold will be a suitable means of asset protection and ultimate payment in such a scenario. It will preserve the wealth of individuals and central banks alike and will ensure important maneuverability for the latter."

GATA believes that the study is likely to have a profound influence on governments, banks, and investors in the Middle East and may accomplish there what the similar report by Sprott Asset Management of Toronto -- "Not Free, Not Fair: The Long-Term Manipulation of the Gold Price" -- is accomplishing in the West.

more...

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20050303005548&newsLang=en

[AP]

1. Gold is no more logical than paper.

My impression is that the value of a currency lies in the ability of its government to create a good economy that taxes its citizens just enough so that it can pay back the debts it incurs borrowing money in order to create that good economy. If people outside the US want to get into that economy, they're going to have to buy dollars to do so, thus dollars become valuable. If people want to get out of that economy, dollars lose their value.

When people want to get out of the dollar, it doesn't mean that gold is suddenly valuable. People could all decide that gold is no longer a wonderful commodity (what's it good for besides looking pretty?) just as they did with salt.

When I saw the headline for this article, I thought it was going to say that the hysteria for gold that you see in those infomercials was a manipulation by American banks trying to increase the value of their gold holdings. But it looks like this article is caming from the same place those infomercials are coming from.

[NVMojo]

3. I agree ...but do you remember the recent decline in the price of gold?

GATA fought hard to prove that certain mining moguls and central banks were involved in the price drop that put most small mining companies out of business or up for sale. Barrick Goldstrike was accused of being part of this action as they had set their gold sales on a "hedge". Funny thing about Barrick was Papa Bush got on their board of directors after he left the White House and somewhere I read they became part of the Carlyle Group. Must look that up.

[NVMojo]

2. Want to understand Senator Harry Reid? You must understand

gold mining in Nevada! Most mines are Republican in their beliefs yet they heavily support Senator Reid because he understands them. Here's some good info on the Cortez Hills trend currently involved in fighting between international gold mining companies and the Western Shoshone:

http://www.amfir.com/AmFir/Commentary%20Pages/EditorialsArticles/NevadaCortez/NevadaCortezPart-1.html