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Sharing info about gold sites, and an exchange of e-mails

Section: Daily Dispatches

Dear Friends of GATA and Gold,

In response to a query from a GATA member, we share some information
about the U.S. gold reserves and Fort Knox. This is followed by a small
miscellany of members' postings, to interest and, with respect to GATA
taking over Governor's Island, Manhattan, perhaps amuse you.

FOR GATA, For Gold,

Boudewijn Wegerif (Bodwin)
Moderator GATA E-mail Group
- - - - -
GATA member E.J. Sheldon wants an audit on U.S. gold holdings and wrote
to Congressman Jim Saxton about this on March 19:

"I told him that the best thing he could do for the good ole USA is
demand an audit of all U.S. gold reserves to immediately find out what
our true gold position is. I believe that all of the gold is not where
it should be and only an audit will reveal where the gold went, to whom,
and for what price, and what reason. Your thoughts are welcome."

GO GATA comment:
All GATA members will be very interested to see Jim Saxton's reply, when
and if he does reply. In the meantime, here is some interesting info on
the subject, from the script of the video film, The Money Masters (for
details about the video, visit

"Most Americans still believe that all that gold is still at Fort Knox.
At the end of World War II, Fort Knox contained 701.8 million ounces of
gold, an incredible 70% of all the gold in the world. How much remains?
No one knows. Despite the fact that Federal law requires an annual
physical audit of Fort Knox gold, the Treasury has consistently refused
to conduct one. The truth is that a reliable audit of whatever
remains here has not been conducted since President Eisenhower ordered
one in 1953."

Where did Americas gold in Fort Knox go? It is said that by 1971, when
the dollar was "freed" from the gold standard, "all the pure gold had
been secretly removed from Fort Knox much of it drained back through
the Fed to the Bank of England. Once the gold was gone from Fort Knox,
President Nixon closed the gold window by repealing Roosevelt's Gold
Reserve Act of 1934, finally making it legal once again for Americans to
buy gold. "

So how did the story about the disappearance of Fort Knox gold get out?
Well, "It all started with an article in a New York periodical in 1974.
The article charged that the Rockefeller family was manipulating the
Federal Reserve to sell off Fort Knox gold at bargain basement prices to
anonymous European speculators. Three days later, the anonymous source
of the story, Louise Auchincloss Boyer, mysteriously fell to her death
from the window of her 10th floor apartment in New York. How would Mrs.
Boyer have known of the Rockefeller connection to the Fort Knox gold
heist? She was the longtime secretary of Nelson Rockefeller."

"For the next 14 years, Ed Durell, a wealthy Ohio industrialist, devoted
himself to a quest for the truth concerning the Fort Knox gold. He
wrote thousands of letters to over 1,000 government and banking
officials, trying to find out how much gold was really left and where
the rest of it had gone. . .

"Unfortunately, Ed Durell never did accomplish his primary goal, a full
audit of the gold reserves in Fort Knox. . .

"What is the government so afraid of. Here's the answer. When
President Ronald Reagan took office in 1981, his conservative friends
urged him to study the feasibility of returning to a gold standard as
the only way to curb government spending. It sounded like a reasonable
alternative, so President Reagan appointed a group of men called the
Gold Commission, to study the situation and report back.

"What Reagan's Gold Commission reported back to Congress in 1982 was the
following shocking revelation concerning gold. The Treasury owned no
gold at all. All the gold that was left in Fort Knox was now owned by
the Federal Reserve a group of private bankers as collateral
against the national debt. Much of the rest of it was still in the
U.S., in the vaults beneath the New York Federal Reserve Bank, but held
there for its bank and foreign owners."

- - - - -
Jim Shanahan is getting the hang of e-mailing politicos. He tells us:
"In my previous life I spent 27 years in the Marine Corps, not a career
which inclines one toward writing Congressmen. However, this blatant
manipulation of PM prices finally pi**ed me off enough to write to
Congressman Jim Saxton. Now that I've got the hang of it I think I will
write some other Congressmen and Senators. One email may not weigh much
but the weight of hundreds will get positive attention. "

Write On, Jim !

- - - - -
Sunshine Mining is the largest silver mining company in the US, plus
they mine a bit of gold. Jim Bruce wrote them:

"As a shareholder I would like to know if you folks are currently
hedging gold and silver. If so could you give me some information
regarding how much of your production is hedged?

Thanks for your timely response."

Sunshine Mining's Executive Vice President and Chief Financial Officer,
William W. Davis, replied:

"Thank you for your inquiry. We have done no hedging, and would not at
these low silver prices."

- - - - -
Rod Michel wrote to Senator Richard G. Lugar in Indiana for GATA and
received this reply:

"Thank you for writing my office. I note your views on regulating hedge
funds. I also have serious concerns with the current regulatory
treatment of hedge funds. I held a hearing last December in the Senate
Agriculture Committee to further study the issue.

The near-collapse of Long Term Capital Management hedge fund caused many
policy makers, including myself, to re-evaluate the current regulatory
structure surrounding hedge funds. As Chairman of the Agriculture
Committee, which has jurisdiction over the futures market, I wanted a
better understanding of how the LTCM situation might impact the futures
industry, the agricultural sector and the public in general. Based on
the testimony of the President's Working Group on Financial Markets, I
came away with the belief that bank lending practices should be

This has already begun to occur as a result of market discipline and
regulatory oversight. More regulation might be necessary. The
President's Working Group is near completion of a study on hedge funds.
I anxiously await the findings from this study, and will carefully
consider any recommendations it might have for Congress.

I appreciate your thoughtful views on this issue."

Rod Michel has also begun educating executives of several Vancouver
Junior Gold exploration companies as to who GATA is and how the markets
are hurting them and all investors.

- - - - -
Finally, we are not sure if he is serious or not, but Michel Roux has

"How about GATA trying to get the N.Y.Island to help the miners who lost
their job because of the government meddling in the gold business, also
to help the investors who have lost money too because of government
intervention. This surely would make the news. If the farmers can, why
not the miners? This post below was copied from the Kitco board. It was
written by Philip Brasher of Associated Press Washington ( AP ),
Datelined March 19:

"Farmers are looking to take Manhattan or at least nearby Governors
Island. At the prodding of some farm-state members, the Senate Budget
Committee agreed to speed up the sale of Governors Island to subsidize
improvements in federal crop insurance. The 173-acre island off the tip
of Manhattan was a military base for more than 300 years until the Coast
Guard closed down operations in 1997.

"Turning that island over to the private sector would probably be a good
thing, and heaven knows we need to scratch wherever we can to find some
additional dollars,' Sen. Tim Johnson, D-S.D., said today. President
Clinton has offered to give it to New York for $1, provided it is used
for public purposes. But Congress two years ago ordered it to be
auctioned in 2002 for $500 million as part of a plan to balance the

"New York officials have since been struggling to devise a plan for
developing the island. . ."

If you have any ideas, with or without tongue in cheek, lets hear from