So what if all markets are manipulated? This is what


12:40p HKT Friday, March 15, 2013

Dear Friend of GATA and Gold:

Our pal D.M. conveys the following disparagement from a friend -- call him Doofus -- and asks for a reply:

"Central banks manipulate far more than just gold -- interest rates, stock markets, housing markets, etc. That's what they do. And so what? The gold price has gone up for the last 12 years, despite the 'manipulation.' So I don't see what's the issue. Even if Western central banks try to sell gold down, Eastern central banks are only too happy to accumulate at lower prices."

... Dispatch continues below ...


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Contrast Doofus' "so what?" argument with the contemptuous and yet ridiculous denial given to CNBC yesterday by CPM Group Managing Director Jeffrey Christian that there is anything surreptitious or questionable going on in the gold market:

CNBC reported ( "Jeffrey Christian, founder and managing director of commodities research firm CPM Group, was a lot more blunt about GATA, saying, 'I think they're outright liars. ... Pretty much what they do is nonsense.' Christian added that he believed there was no conspiracy among global central banks to collude over gold prices and that central banks are 'very transparent' about their monetary gold reserves."

Doofus says that what GATA trumpets is only obvious. But Christian not only denies what Doofus calls obvious but, in denying it, is considered an industry expert by financial news organizations.

So are central banks manipulating the gold market and other markets or not? Before disparaging GATA Doofus might try putting the question to Federal Reserve Chairman Ben Bernanke. If Doofus gets an acknowledgment of market manipulation, it will be international news.

Then consider whether, in democracies, governments should be lying to and misleading their people quite so comprehensively and whether it's really a matter of indifference even to Doofus himself whether any democracy or the world has free markets.

Yes, rigging markets is indeed what central banks do these days. That's what a high school graduate told GATA's Washington conference five years ago:

"Gold is only part of it. For market intervention is exactly why central banking was invented. Intervening in markets is what central banks do. They have no other purpose. (See

But is this intervention right? And will the propriety of it ever be judged if the intervention itself is covered up or denied as supposed industry experts like Christian deny it?

If this manipulation of markets is really no big deal, then why are central banks so damned secret about it? Why do they have to be sued to provide ordinary documentation? (See

Obviously this stuff is a lot bigger deal to the central banks than it is to Doofus. What are the central banks afraid of? Could it be that deception of markets and whole populations has become a major policy tool of central banks, a tool they are desperate not to lose?

And while, as Doofus notes, gold has gone up from $250 to $1,600 in the 13 or so years GATA has been complaining about market manipulation, how fair is this when, in a free and transparent market, gold well might be priced at 10 times $1,600?

Besides, as that high school graduate said, gold is only part of the problem -- the central part but a rather small part. The much bigger part is the undemocratic allocation of political power and wealth in the world and the West's loss of the free markets that helped make it great and propelled the ascent of man.

GATA couldn't care less whether Doofus or anyone else invests in gold. We're pursuing far bigger things: democracy; free and transparent markets; and limited, accountable government, which encompasses Doofus' right to be a selfish and irrelevant nihilist.

So what? That's what.

As for Christian, why do so many gold market followers get so agitated about him?

In the first place, GATA has struck no blow exposing gold market manipulation stronger than the one Christian himself struck with his testimony at the March 25, 2010, hearing of the U.S. Commodity Futures Trading Commission, when he stated that the leverage in gold trading in the London physical bullion market -- the ratio between metal traded and metal actually existing -- was as much as 100 to 1 and that the so-called physical market really isn't so physical at all.

And second, note what Christian, whose firm has many central bank clients, was reduced to in his comments to CNBC: reduced to asserting that central banks are "very transparent" about their gold reserves. Good grief -- even the pillar of the Western financial establishment, the Financial Times, acknowledged a few weeks ago that central banks have been far from transparent about their gold:

Has Christian lately gotten a tour of Fort Knox, which hasn't been opened to the public for decades? Has he been allowed to review the gold trading books of the Federal Reserve, Bank of England, Bundesbank, and Bank for International Settlements? Have those central banks given him a current list of their gold swaps and leases? Has he been invited to attend any of the meetings of the G-10 Gold and Foreign Exchange Committee, a committee whose very purpose is central bank collusion about gold? If Christian has such information, will he, in pursuit of the transparency he proclaims, share it with the world?

Of course not. But Christian's unsupported and plainly ridiculous profession of transparency is apparently the only defense that can be made of central banking here, making him the Wizard of Oz of the gold world: "Pay no attention to that man behind the curtain." How painful this might be for anyone who wasn't already on central banking's payroll.

Christian isn't the challenge. The challenge is to embolden financial news organizations to try committing journalism to expose central banking's many deceptions. Emboldening such journalism is a slow process, but Christian performs another great service for that process when he demonstrates that, with gold, central banking has no defense at all.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

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