Gold 'debate' at Vancouver conference fizzles

6:45p CT Tuesday, June 8, 2010

Dear Friend of GATA and Gold:

If gold is in a bubble, it wasn't apparent at the World Resource Investment Conference in Vancouver Sunday and Monday, the conference being lightly attended despite the beautiful venue, the beautiful weather, and a large number of exhibiting companies.

What was supposed to be the conference's highlight, a debate about gold between Kitco senior market analyst Jon Nadler and U.S. Global Investors CEO Frank Holmes, was a dud.

The audience expected an argument over gold market manipulation, and the first question from the moderator, retired gold newsletter editor Bob Bishop, pointed the participants in that direction.

But Nadler stated flatly that central banks have no interest in manipulating the gold market, Holmes said gold was likely part of comprehensive if not terribly coordinated market intervention by central banks, and that was that.

The debate offered no review of the central bank intervention in the gold market that is part of the otherwise acknowledged historical record, like the London Gold Pool of the late 1960s, nor of the both open and surreptitious intervention GATA has documented, often from the files of central banks themselves. Such material can be found in the "Documentation" section of GATA's Internet site here:

http://www.gata.org/taxonomy/term/21

A;parently neither panelist was prepared to review the history and the documentation, nor, apparently, had they been asked to.

Indeed, it seems unlikely that Nadler, who long has greatly resented suggestions of gold market manipulation, would have participated at all if the agenda included any review of history and documentation.

Since central banks are usually so secretive, the contemporaneousness and degree of their intervention in the gold market are always fairly subject to interpretation and debate. But central bank interest in gold price suppression is beyond any reasonable dispute. Federal Reserve memoranda and meeting minutes as well as personal memoirs, contained in the "Documentation" section of GATA's Internet site, demonstrate that in recent decades at least four former chairmen of the Fed were intensely interested in suppressing the price of gold -- William McChesney Martin, Arthur Burns, Paul Volcker, and Alan Greenspan.

If central banks are not surreptitiously involved in gold price suppression even now, why has the Fed refused to give GATA access to its gold records and particularly the records it acknowledges concealing about its gold swap agreements with foreign banks? If the Fed has no interest in suppressing the price of gold, why has GATA had to sue the Fed for access to these records under the Freedom of Information Act in U.S. District Court for the District of Columbia?

How anyone can blithely deny such evidence and manifest so little curiosity and still be considered a gold market analyst?

But then purported doubters of the gold price suppression scheme have sunk to worse lately. In his recent debate with GATA Chairman Bill Murphy at Jim Puplava's FinancialSense.com, CPM Group executive Jeffrey M. Christian restorted to wholesale fabrication. Christian sought to minimize something in Federal Open Market Committee meeting minutes from 1995 that GATA has often cited -- the acknowledgement by Fed general counsel Virgil Mattingly that the U.S. government lately had been involved in gold swaps.

The swaps cited by Mattingly, Christian claimed in the debate at FinancialSense.com, were entirely innocent and involved U.S. financial assistance to Portugal. But questioned by Fed Chairman Alan Greenspan about his gold swap comments in the FOMC minutes, Mattingly offered no such explanation. Rather, in a memorandum to Greenspan published by GATA, Mattingly denied making any statements about gold swaps at all and insisted that the FOMC minutes had misquoted him.

Evidence of central bank intervention in the markets, open and surreptitious, abounds lately. Just the other day the German economics minister was quoted by Dow Jones Newswires as saying that the Fed has been intervening lately in the currency markets:

http://www.gata.org/node/8687

And yet the Fed has not announced any such intervention -- and as far as we can tell, no other news organization has pursued the Fed for explanation. Most news organizations seem to have no more curiosity about central bank market intervention than Nadler and Christian do.

Kitco has posted video of the Nadler-Holmes debate here:

http://www.kitco.com/KitcoNewsVideo/kitco_news.htm

But don't let it take you away from reruns of "My Mother, the Car."

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

To contribute to GATA, please visit:

http://www.gata.org/node/16