World Gold Council gives up on gold

Tuesday, September 5, 2000

Dear Friend of GATA and Gold:

As chief executive of the World Gold Council, Haruko
Fukuda has developed an outstanding relationship with
executives of the gold mining companies. But there is a
big split on the council over what is really going on
in the gold market. She knows that and we know that.

So on behalf of the Gold Anti-Trust Action Committee, I
have sent her the letter that appears below.

BILL MURPHY, Chairman
Gold Anti-Trust Action Committee Inc.

* * *

Dear Ms. Fukuda:

Your commissioned study, quot;Gold Derivatives: The
Market View,quot; by Dr. Jessica Cross and Virtual Metals
Research and Consulting Ltd., is long and detailed,
but I believe it does a disservice to the gold
industry and gold market participants.

The Gold Anti-Trust Action Committee (GATA) presented
its own lengthy quot;Gold Derivative Banking Crisisquot;
report to House Speaker Dennis Hastert; U.S. Rep.
Spencer Bachus, chairman of the House Subcommittee on
Domestic and International Monetary Policy; Dr. John
Silvia, chief economist of Senate Banking Committee;
and to every member of the House and Senate banking
committees.

Last week the Frankfurter Allgemeine Zeitung,
Germany's leading newspaper, published two articles
about GATA's report and concluded that what GATA says
should be taken seriously. I have attached a summary
of the first article in English and an English
translation of the second one.

We believe that the gold loans are twice what Jessica
Cross has ascertained; that the extraordinary buildup
of gold derivatives at certain bullion banks, while
not at others, is significant; and that the gold
market IS being manipulated.

In the spirit of gold market transparency, which you
say is so needed, would the World Gold Council be
willing to sponsor a debate on the merits of both
reports? GATA challenges Jessica Cross and her
associates to debate these issues:

* The gold loans. Are they 5,200 tonnes or 10,200
tonnes?

* The significance of the gold derivatives buildup.

* Is the gold market manipulated? The evidence versus
the lack of evidence.

The commentary and analysis of independent consultants
Frank Veneroso of Veneroso Associates and Reginald Howe
of www.GoldenSextant.com represented two-thirds of the
Gold Derivatives Banking Crisis report. GATA will ask
them to join us in the debate. We would accept a
location of your choice, should you and Ms. Cross accept
this challenge.

I look forward to hearing from you.

Sincerely,

BILL MURPHY, Chairman
Gold Anti-Trust Action Committee Inc.