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QB Asset Management's report on gold's hidden value and price suppression
8:44p ET Sunday, September 11, 2011
Dear Friend of GATA and Gold:
Our friends Lee Quaintance and Paul Brodsky at QB Asset Management in New York have just written a brilliant report, titled "Your Gold Teeth," on the hidden and suppressed value of gold and the manipulation of the gold market. They maintain, in part:
"The amount of gold ounces represented on futures exchanges vastly exceeds the amount of deliverable gold in the world, and the perpetual rolling of front-month contracts insures that very little physical gold actually changes hands. Further, claims for gold represented by other derivative vehicles off futures exchanges but priced off futures, such as ETFs, gold swap agreements, and even fully-paid-for yet unallocated gold held in storage, cannot be satisfied.
"We do not have a problem with gold futures per se (in contrast to many gold fans who decry naked shorting), because for every seller of gold claims there must be a buyer. But it is important to recognize that the leverage inherent in gold futures changes its character; physical gold is a real asset while gold futures are financial assets. Like other financial asset markets, the paper gold market is grossed-up with leverage but its open interest nets out at equilibrium pricing.
"This does not mean that equilibrium pricing in gold futures necessarily represents 'fair pricing.' We believe participants in gold futures include: 1) speculators at every level of sophistication who buy and sell them seeking financial gain from either price changes or, at times, positive carry; 2) banks that create unreserved credit denominated in baseless money, that short gold futures because they have incentive to sustain the current monetary system and maintain control over credit distribution, and 3) sophisticated international purchasers of physical gold that short futures to keep the benchmark price low so they can amass more physical bullion.
"If the preponderance of sellers of gold futures enjoys far better funding terms than do their buyer counterparties, then it would seem logical there would be great advantage to sellers to maintain prices lower than they would otherwise be if funding of futures were equitable."
QB Asset Management has graciously consented to GATA's sharing its report with you here:
http://www.gata.org/files/QBAMCO-YourGoldTeeth2-08-2011.pdf
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Lewis E. Lehrman on How to Solve the U.S. Debt Problem
Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program.
Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust.
Lehrman says: Eliminating the budget deficit of a trillion and a half dollars cannot be done overnight. The proposal by U.S. Rep. Paul Ryan was very dramatic -- one Republican called it radical -- but it was not happily received. The solution, of course, is to design an American program for prosperity, because you can solve these entitlement problems with a growing economy. We need a tremendous program of investment, and investment comes from savings. When you pay savers, middle-income professionals, and working people 0 percent at the bank, you are not going to encourage them to save. Then we are left with a bank cycle of debt, leverage, boom, panic, and bust."
To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit:
http://www.thegoldstandardnow.org/gata
Join GATA here:
Toronto Resource Investment Conference
Thursday-Friday, September 15-16, 2011
Sheraton Toronto Centre
http://cambridgehouse.com/conference-details/toronto-resource-investment...
The Silver Summit
Thursday-Friday, October 20-21, 2011
Davenport Hotel, Spokane, Washington
http://cambridgehouse.com/conference-details/the-silver-summit-2011/48
New Orleans Investment Conference
Wednesday-Saturday, October 26-29, 2011
Hilton New Orelans Riverside Hotel
http://www.neworleansconference.com/
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https://www.amsterdamgold.eu/gata/index.asp?BiD=12
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http://gata.org/node/wallstreetjournal
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Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit,
Extending the Mineralization of the Southwest Vein on the Property
Company Press Release, October 27, 2010
VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:
-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.
-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.
-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.
Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.
"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."
For the company's full press release, please visit:
http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf
