The critical questions Kitco never put to Doug Casey about gold price suppression
11:36a ET Friday, July 11, 2014
Dear Friend of GATA and Gold:
Interviewed this week at the Freedom Fest conference in Las Vegas by Daniela Cambone of Kitco News, Casey Research founder Doug Casey called complaints of gold price suppression "ridiculous."
Governments can't be suppressing the price of gold, Casey maintained, because gold has done rather well for four decades, because governments own a smaller share of the world's gold than they used to, and because all governments are bankrupt.
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These are hardly persuasive arguments if they are even arguments at all.
As for gold's having done rather well since it was completely delinked from currencies in 1971, the great disparagement about gold today remains that even with its nominal price increase since then, it has greatly underperformed inflation. Casey has not addressed and explained that.
It's not clear how the government sector's diminished share of the world's gold diminishes government's incentive to suppress its price. To the contrary, the diminished government share of the world's gold would seem to increase government's incentive to suppress gold's price, since, held more widely and independently, gold then would have increased its potential to become a currency competing with government currencies.
The same with the insolvency of governments. Wouldn't a rising gold price call attention to such insolvency and scare investors away from government currencies and bonds?
But all that is merely reason and speculation. To be settled, what the gold price suppression issue needs, as any issue does, is facts, and facts can be obtained only by inquiry, not by mere pontification.
That's why the questions GATA has proposed for presentation to former Federal Reserve Chairman Alan Greenspan during his appearance at the New Orleans Investment Conference in October --
-- should be put to those who, like Casey, deny any possibility of gold price suppression by central banks.
Those questions include:
-- Are central banks surreptitiously involved in the gold market, secretly trading gold, gold derivatives, and related financial instruments, as reports from the International Monetary Fund and Bank for International Settlements say? See:
-- If central banks are involved in the gold market, why? Is it just for fun -- for example, are central banks running contests among their foreign-exchange desks to see which can out-trade the other? Or is profit the objective of such trading, as central banks use their great heft, the power of infinite money creation, to move markets in their favor and thereby fleece lesser participants? Or are central banks secretly trading gold, gold derivatives, and related financial instruments for more serious policy purposes, like controlling the currency, bond, and equity markets to support their currencies and government bonds, with the fleecing of ordinary investors being merely an incidental consequence?
-- Are the many official records and admissions of gold price suppression by central banks, like those compiled by GATA here --
-- of any value in discerning the purposes of gold-related trading by central banks?
-- Is there a fractional-reserve gold banking system in which the credit of central banks and bullion banks replaces actual gold deposits and thereby vastly increases what the world considers its gold supply, thereby suppressing gold's price? If so, do central banks underwrite and sustain this system with gold sales, swaps, and leases involving bullion banks? If central banks do underwrite and sustain this system, why? Central banks apparently do not underwrite and sustain such a system in soybeans, pork bellies, and other commodity markets, do they? Do gold's competition with central bank-issued money and gold's influence on interest rates and the value of government bonds have anything to do with central bank involvement with the gold market and the fractional-reserve gold banking system?
-- Have those people who disparage complaints of gold price suppression by central banks ever put to central banks any questions about their involvement in the gold market? Have those who disparage complaints of gold price suppression ever sought to obtain access to central bank records of that involvement? If not, how can they be sure that central banks don't seek to control the gold price through surreptitious market intervention?
-- Are the many documents that GATA has compiled involving gold price suppression --
-- forgeries or have they been misconstrued?
Along with Greenspan, Casey also is scheduled to speak at the New Orleans conference. He'll be a lot more interesting if he skips some of the pontificating and tries addressing the documentation and the facts. But he needn't wait until then to try answering the questions above. GATA would be glad to publish his answers at any time.
Of course Cambone's interviews would be a lot more interesting too if she ever tried posing critical and fact-based questions.
Her interview with Casey is 6 1/2 minutes long and is posted at Kitco's Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
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