View Single Post
Old 01-12-2013, 04:55 AM
Danny B Danny B is offline
Platinum Member
Join Date: Oct 2012
Location: L.A. Ca.
Posts: 4,673
Gold and leverage

The financial wizards have been piling on leverage on top of leverage in financial instruments. They keep inventing new words to describe the towering, wobbly constructs. CDO squared and re-hypothecation are two of the new creatures. They have tried to do the same with gold and silver.
It's not working so well because gold-bugs catch on too fast.

Gold is supposed to be sold like commodities, NOT like financial instruments.
One of the bullion banks, CME Group admitted at a CFTC hearing that they sell every ounce of gold 100 times.
Since "everybody" doesn't go to the bank and take out all their money, the bullion banks just assumed that "everybody" wouldn't come and take all their gold. It's not working out that way.

"Royal Mint of Canada sold in 2008,,,, over $1 billion worth of gold."
Today, they have a total of $ 100 million on hand. They are the only bullion bank in Canada. They aren't alone in gold ripoffs.
"class action lawsuit filed against Morgan Stanley, which was settled out of court, in which it was alleged that Morgan Stanley told clients it was selling
them precious metals that they would own in full and that the company
would store, yet even despite charging storage fees was not in actual possession of the bullion."
The Latest Gold Fraud Bombshell: Canada's Only Bullion Bank Gold Vault Is Practically Empty | Zero Hedge

Bankers and the state HATE gold because it forces discipline. The London Gold Pool was formed years ago to suppress the price of gold. It failed when everybody took their gold away.
There has been a second gold "Pool" formed and it too is failing because people are taking delivery of the gold,,, rather than trusting the banks.
Guest Post: The Failure of the Second London Gold Pool | Zero Hedge

The question of gold confiscation is always in the background. It wouldn't seem likely because GOV can just print currency to buy up the gold.
The gold that the U.S. claims to have on hand is valued at $42.42 an ounce. GOV could easily force people to sell their gold to GOV. GOV could set the price where they want it. They could also outlaw the export of gold. It wouldn't be a big surprise if GOV mandated that everyone sell their gold to GOV for??? $ 100 an ounce.

It wouldn't be difficult to install gold/metal detectors in every airport and dock. The best detectors can discriminate and detect from 300 ft. away.
Logan airport already has cash-sniffing dogs.

The central banks tried to completely rid the financial system of gold. They referred to it as a "barbaric relic". Big, Bad, Bald, Ben Bernanke said that America holds on to gold just out of tradition.
The CBs sold off all the gold trying to expunge it from the financial system.
This didn't work and now several are trying to buy it back.
The bullion banks sold every ounce of gold 100 times. Now that people are taking delivery, they are going to run out of gold. This will cause catastrophic losses to 99% of the people who think that they own gold.
This could cause enough of a ripple to crash the system.

The CBs refer to gold as a barbaric relic. The central bank to the central bankers does ALL account settlements in GOLD. The BIS settles all accounts in gold,,, only. This gives you an idea of the actual value that is assigned to gold.
A crash in the precious metals market could bring down the whole system.
Reply With Quote