More on the strange disparities in gold, silver markets

2:18p ET Friday, October 17, 2008

Dear Friend of GATA and Gold:

Two more market analysts have taken detailed note of the great and strange disparities in the gold and silver markets.

At Seeking Alpha, Tim Iacono's analysis is headlined "Gap Between Paper and Physical Prices Widening Daily," and you can find it here:

http://seekingalpha.com/article/100141-silver-gap-between-paper-and-phys...

Or try this abbreviated link:

http://tinyurl.com/5zys3u

Meanwhile J.S. Kim, founder of the SmartKnowledgeU investing system, details at the Underground Investor four parallel markets for gold: Asian futures, New York futures, physical bullion, and physical coins. Of course gold is always much higher in Asia and always getting pounded in New York. Kim produces many charts and then asserts:

"The above seems like compelling evidence to me that something is seriously amiss in the futures markets for gold (notably paper markets, easily manipulated because physical delivery of gold to settle these contracts happens less than 1 percent of the time); and that rampant manipulation for profits by just a few players is occurring in an unchecked fashion. According to data recently released by the Office of the Comptroller of the Currency, a division of the U.S. Treasury Department, of the $135 billion of gold derivatives contracts (including futures and options) controlled by financial institutions, JP Morgan controls $96 billion (71.11 percent) of these contracts and HSBC Bank USA controls $34.4 billion (25.48 percent). In other words, just two players control almost all gold derivatives contracts in the entire United States."

Kim credits silver market analyst and GATA consultant Ted Butler for exposing the manipulation in silver. Kim also includes some correspondence he has had with Commodity Futures Trading Commission member Bart Chilton.

You can find Kim's analysis here:

http://www.theundergroundinvestor.com/2008/10/16/four-parallel-markets-f...

Or try this abbreviated link:

http://tinyurl.com/67rlae

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

* * *

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at http://www.gata.org/.