Was
set up as the US was running high deficits to cover for the Vietnam War
and the Great Society. Its goal was to prevent the gold price to break
through the $ 35/onz. Each time the Gold price was about to overrun this
level, the international pool sold gold until the price was rebalanced.
General De Gaulle looked through this game and simply requested the
exchange of his dollars for GOLD. As a result in 1970 Nixon had no other
choice than to close the gold window.
The
2008 paper Gold pool has triggered a run on the Dollar and the World Gold
reserves.
The actions
of the PPT can be compared to the
Gold Pool which existed before the last great financial crisis and was
revitalized in 1960. But instead of selling PHYSICAL Gold and Silver (there is
little left), this Summer (but also on many other occasions each time it was
needed) they sold PAPER Gold and Silver.
This action however is back firing: the
lower they take paper Gold and Silver down, the more physical Gold and Silver
is being bought! Johnson Matthey has weeks of delay in delivery and
today they even talk of stop taking orders all together and February of 2009
is the shortest delivery date for silver Eagles.
This is today's version of
the Gold Pool:
The US financial markets
are slowly being revealed as a series of corrupt Ponzi schemes.
The gold market is the vulnerable linchpin for the USDollar and US
Treasury markets. That is why gold is so important to be
controlled and suppressed.
Under the
1944 Bretton Woods agreement, foreign banks could convert US dollars to
Gold at a rate of $ 35.20 per oz. (or this is how the US Dollar took over the
role of the British Pound as Reserve Currency - ironically, the US dollar
has been walking the same path as the British Pound is...)
Markets that have been artificially capped, catapult
dramatically when the market suppression ends: since 1968 the Gold
price has risen by 2,500% !
Know of any better investment? Got Gold?
Throughout the post war
years of the 1950's and 60's, the daily price of gold rarely moved outside
of a 15 cent trading range $35. In 1944, the Bretton Woods conference
saw the US dollar overtake the function of the British Pound as sole
reserve currency of the world.
Over time, the glut of
US dollars held abroad began to threaten US gold reserves and by 1959, as
more and more Dollar holders were exchanging them for Gold, a Gold Pool
was set up to control the Gold price. It was especially important to
maintain the London fixing at $ 35.20 because it was cheaper to purchase
gold in London than across the Atlantic as shipping and insurance would
increase the final price.
It was in 1961 under
Kennedy that a Gold Pool (to prevent the market price of Gold from
exceeding $ 35.20 per oz.) arrangement was set up. It all went well until
in November 1967 the devaluation of the British pound caused another run
on Gold. In a matter of weeks the pool had laid out in excess of 1000 ton.
Charles de Gaulle
(French president at that time) withdrew from the pool and demanded Gold
for the US dollars they held instead of US-treasuries. The drain on US
gold became acute.
This rings a bell!
Holding the gold price artificially down - in fact - created even more
demand. The more London Gold-pool reaffirmed its determination to
defend the $ 35.20 per oz gold price (ironically), the more gold was
bought and the more Gold the pool had to deliver. As the London Gold pool
continued to fight the free market process by defending $ 35.20 (like
today they defend $ 1,000), the stronger demand became. As daily
turnover mushroomed to 30 times the normal sales, the British Queen
declared a "bank holiday" (upon request of the USA). The London gold
market remained closed for 2 weeks while France and Switzerland continued
to trade Gold at a price exceeding $ 45 per oz.
The resulting
two-tier market for Gold was completely abandoned in 1970 when Nixon
closed the Gold window. This was the day, the US dollar (and at the same
time many other currencies which held US Dollars as Reserve) officially
became Fiat Paper Money.
NOTE: Today, Gold
is manipulated using the 'DERIVATIVES' or the 'PAPER MARKET' . The result
being that Physical demand and physical delivery keeps on growing. Some
day the physical market will clash with the Paper markets and the price of
Gold will explode and/or a new 'Bank Holiday' will be seen. This time it
will be declared by the USA.
1961
Gold pool (representatives of 7 countries who tried unsuccessfully to
control the price of Gold between 1961 and 1968 at $ 35.20 per oz.):
Was
set up as the US was running high deficits to cover for the Vietnam War
and the Great Society. Its goal was to prevent the gold price to break
through the $ 35/onz. Each time the Gold price was about to overrun this
level, the international pool sold gold until the price was rebalanced.
General De Gaulle looked through this game and simply requested the
exchange of his dollars for GOLD. As a result in 1970 Nixon had no other
choice than to close the gold window. Looking at the chart below, it is
not hard to understand why De Gaulle took this decision.
T
This rings a bell!
Holding the gold price artificially down - in fact - created even more
demand. The more London Gold-pool reaffirmed its determination to
defend the $ 35.20 per oz gold price (ironically), the more gold was
bought and the more Gold the pool had to deliver. As the London Gold pool
continued to fight the free market process by defending $ 35.20 (like
today they defend $ 1,000), the stronger demand became. As daily
turnover mushroomed to 30 times the normal sales, the British Queen
declared a "bank holiday" (upon request of the USA). The London gold
market remained closed for 2 weeks while France and Switzerland continued
to trade Gold at a price exceeding $ 45 per oz.
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