Tag Archives: World Gold Council

Want to Smack Down the Criminal Global Banking Cartel?

Yeah, I believe there’s quite a few investors who would like to smack a couple of bankers after being deceived about their financial situation and the state of the economy in general. I do not encourage violence in any way, but would really like to see someone pull the pants of those big shots who think they’re just doing God’s work while the common tax payers are financing their private jets, limousines, 7 apartments and 14 beach houses. And the more sophisticated, the better. JS Kim at SmartKnowledgeU appears to have a plan.

“Sell the likely fraudulent SLV and GLD ETFs, cease participating in the fraudulent gold/silver futures markets, buy physical gold and silver, and buy gold/silver mining stocks.”  

JS Kim

In 1966, Alan Greenspan wrote an essay more than two decades before his sold his soul to bankers, that indicted the US Federal Reserve in as clear language as possible for the Great Depression that afflicted the world economies at the end of the 1920’s and through the 1930’s. Greenspan wrote that by bailing out the Bank of England‘s drastic devaluation of the pound, the US Federal Reserve “nearly destroyed the economies of the world,” JS Kim writes.

And he continues:

Though Greenspan’s words served as a strong indictment as possible of Central Bank failures to serve humanity and to only serve the greedy private interests that backed them, the whole world seemed to forget Greenspan’s words for the next 46-years.

Only today are people finally realizing the truth about Central Banks and the behemoth commercial banks that serve under them – that they have no interest in promoting price stability or full employment but only in transferring wealth from every single citizen of the world to themselves and the crony politicians that serve their interests.

Gold Related Assets (Source: World Gold Council)

Want to participate in smacking down the criminal global banking cartel? Here’s how to do it:

Sell the likely fraudulent SLV and GLD ETFs, cease participating in the fraudulent gold/silver futures markets, buy physical gold and silver, and buy gold/silver mining stocks.

The good news is(1) This is a simple strategy; and (2) Buy wisely, and you will likely build significant wealth while participating in this strategy.

The fraudulent immoral monetary system that bankers have imposed upon the world that steals money from savers and creditors and transfers wealth to governments, debtors and bankers can only be perpetuated by the price control mechanisms bankers have instituted for gold and silver.

Destroy these price control mechanisms and the fiat currency system will fail.And what happens if the fiat currency system fails?

We all have a chance to institute an honest and equitable monetary system that promotes price stability and sustainable growth instead of struggling under a dishonest one that destroys these desirable socio-economic qualities.

The ability of bankers to suppress the price of gold and silver (yes, even the price of $1,800 gold and $40 silver is severely suppressed) is based upon their ability to sell the perception that a much greater supply of silver and gold exists than actually does.

In fact, in this very newsletter, on April 27, despite all the PM media “experts” that tried to scare investors out of silver by claiming a silver bubble back then, we sent out an issue of this free newsletter titled “Silver is NOT a bubble” and then nearly called the exact bottom range of this silver correction for our paying members a couple of months ago.

Over the past six years, I have publicly blogged dozens of times regarding the mechanisms bankers use to accomplish the suppression of gold and silver prices, including most recently in my article, “Why Gold and Silver Prices Will More than Double Again Even from Current Prices.”

Smack That!

Current data provided by the CME regarding gold and silver futures contracts that trade on the COMEX reveal that about 100 times more paper gold ounces trade on this exchange every year than all the physical gold that exists in the world and some where around 160 times paper silver ounces trade every year than all the physical silver that exists in this world.

By expanding the supply of paper ounces of gold and paper ounces of silver at the same time that real physical supply of gold and silver are shrinking, the bankers have been able to suppress the price of gold and silver from reaching its true free market prices for decades.

The GLD and SLV very likely participate in this fraudulent scheme in helping to creating massive illusory supply of gold and silver that simply does not exist.

Thus if gold and silver are freed from the criminal global banking cartel’s scheme to suppress their prices, this will help all people in the world, even the Doubting Thomases, to recognize the fraud of our current fiat currency system.

Under our current monetary system, a businessman will never be able to receive the same value for the money he receives for any goods and services rendered unless he immediately spends all of said money.

The fact is,it is impossible for a businessman that holds fiat currency for services rendered for a duration of time any longer than a few months to then receive the equivalent value of that fiat currency when it was first received.

This fact about our current monetary system is a massive disincentive for any businessman anywhere in the world to work harder as the reward of additional nominal amounts of money can never be equivalent to the effort put forth.

Thus, our “modern” fiat currency system literally destroys any chance to achieve sustainable economic efficiency.

If a businessman works harder to earn 17.65%more money than last year, but that 17.65% boost in the nominal amount of money only enables him to purchase the exact same goods and services as last year due to an annual 15% inflation rate ($117,647 * 85% = $100,000), at some point and time, the destruction of efficiency that our fiat currency system imposes upon all businesses will inevitably lead to business contraction instead of sustainable business growth.

So how do we fight back against this unjust and immoral fiat monetary system created by Central Bankers?

Below are three simple steps we all can take. (1) Stop enabling banker fraud and realign your interests with the interests of humanity. Yes that means if you are long the GLD and SLV,or rollover long gold and silver futures contracts without ever takingphysical delivery, you are silently facilitating the banker war against humanity as you aid and a bet them in creating an illusory supply of gold and silver that simply does not exist. (2) Sell GLD and SLV shares and re-invest the proceeds of these sales into physical gold and physical silver and/or gold and silver miningshares. (3) Settle all long gold/silver futures contracts with physical delivery only and not in cash.

Gold stocks are a great value right now as you can see in the below chart. So are silver stocks as well. (Even though my Crisis Investment Opportunities newsletter has returned roughly a cumulative +220% over the past four years, since I believe gold/silver mining stocks to be the most highly undervalued asset class in the entire stock market now, I honestly believe that we will shatter those returns in the next four years.)

However, ever since introducing the GLD and SLV, bankers have successfully been able to steer money away from fundamentally solid gold and silver stocks into these likely fraudulent ETFs.

To see the above referenced chart and to read the rest of this article, click here.

Best investing,

JS Kim

Chief  Investment Strategist

SmartKnowledgeU

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Paper Gold Trading Drops in Q1, Negative Inflow for First Time in 2 Years

The OTC investments in gold papers decreased for the fourth quarter in a row during the three first months of 2011, the latest report from World Gold Council show. Investments in gold EFT’s and similar products fell by 56 tonnes in Q1, equaling a net outflow from the funds of more than USD 2,5 billion.

Notably, EFT’s listed in the US and the UK markets experienced net redemption in the first quarter.

World Gold Council


In spite of a fresh all-time-high for the gold price, the capital flow in the markets for ETF’s, and similar gold related investment products, is negative the first time in two years. The outflow in Q1 is almost as big as the inflow in Q4 2011.

But the gold market works in mysterious ways, so what’s actually going on is kinda hard to say.

One thing is for sure, the central banks are buying gold as never before.

But besides Japan, no one is selling.

In the open market, that is.

Most of the trading is done in the non-transparent OTC market.

By who? you might ask.

Well, your guess is as good as mine. This is what the World Gold Council wrote in their April Gold Investment Digest report:

The majority of gold trading takes place in the global over-the-counter (OTC) wholesale market for physical bullion.

While OTC markets are the deepest and most liquid markets in the world, information about transactions is not always fully accessible to the public as they are conducted outside of regulated exchanges.

However, evidence suggests that trading volumes in the global gold market is quite large; in-line with or larger than trading of other high-quality assets such as sovereign debt.

The London Bullion Market Association (LBMA), through surveys of its members, estimates that the daily net amount of gold that was transferred between accounts in 2010 averaged USD 22 billion (based on the average 2010 gold price).

However, in practice, trading volumes between the bullion banks are significantly higher.

Most banks estimate that actual daily turnover is at least three times that amount and could be up to ten times higher.

This would value global OTC trading volumes anywhere between USD 67 billion and USD 211 billion.

During the first quarter of 2011, figures from the LBMA show that activity in the OTC market mirrored that of ETFs and futures.

Volumes rose during the January consolidation to an 8-month high of US$26.1bn/day before subsiding in February as prices recovered. Assuming a continuation of this pattern, indications from ETF and futures markets are that OTC volumes picked up again in March as gold prices maintained their
steady climb, the WGC wrote in last months report.

Well, here’s today’s update:

The April report seem, in fact, more interesting now, after the release of the May report.

Here’s some more:

Activity in the ETF options market remains robust, which continues to offer alternative strategies for investors. The majority of the volume in these products is still being transacted by way of GLD options. In line with some of the outflows experienced in the ETF market during the quarter, GLD options volumes dropped in Q1 2011 on a quarter-on-quarter basis. However, at an average daily volume of 234,724 contracts during the first quarter, trading volumes remain higher than the daily average of 208,131 contracts during the whole of 2010. In general, call option volumes remained higher than put volumes during the period. Similarly, open interest on call options accounted for the majority of traded contracts, at an average of 2.1 million contracts in Q1, compared to 1.7 million put contracts. However, open interest in call options fell further relative to Q4 2010 than the open interest in puts, as investors likely exercised some of those calls as the price of gold fell in the early part of the year.

And here’s some of the most interesting charts from today’s release, Gold Market Trends, May 2011.

Download:

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Exploding Gold Demand In 2010

Demand for the most precious of metals just keep on rising. It’s really not a good sign, as gold traditionally is seen as an insurance against turbulent markets, natural catastrophes and wars. In 2010 the global demand for gold reached the highest in a decade, at 3.112,2 tonnes, worth about 159 billion USD, the World Gold Council reports. The price reached a new all-time-high at 1.421 dollar an ounce.

Emerging country banks are likely to continue purchasing gold as a means of preserving national wealth and promoting greater financial market stability.”

George Milling-Stanley


“As anticipated, 2010 was a great year for gold with demand strong across all sectors. The opening weeks of this year have been characterised by an East/West divide. The dip in the gold price in January resulted in a reduction of ETF tonnage and a decline in the net speculative long position on COMEX. This has been counterbalanced by very substantial physical demand flows in Asian markets,” Marcus Grubb, Managing Director at the World Gold Council says.

The shift in central bank activity was the result of two distinct market forces. Emerging market economies, experiencing rapid growth, have been large buyers of gold to diversify their external reserves.

Meanwhile, European central banks have virtually stopped sales in the wake of the financial and European sovereign debt crises.

The latest Gold Demand Trends report, released Friday, examines the impact of this development on the gold market in more detail.

“Emerging country banks are likely to continue purchasing gold as a means of preserving national wealth and promoting greater financial market stability. Any gold sales from advanced economies are unlikely to be significant as the official sector remains highly risk-averse. Collectively, the official sector is still a significant holder of gold. Central banks remain committed to its importance and relevance in maintaining stability and confidence as they have been for hundreds of years,” George Milling-Stanley, Managing Director, Government Affairs at the World Gold Council, says in a statement.

Here’s some of the highloghts of the report:

  • Gold demand in 2010 reached a 10 year high of 3,812.2 tonnes. Demand was up 9% year-on-year, and marginally above the previous peak of 2008 despite a 40% increase in the annual average price level between 2008 and 2010. In value terms, total annual gold demand surged 38% to a record of US$150 billion.
  • Jewellery demand was remarkably robust in the face of record prices in the majority of currencies. Annual demand for gold jewellery rose 17% from 1760.3 tonnes in 2009 to 2059.6 tonnes. The rise in annual average prices over the same period was 26%. In value terms, this resulted in record annual jewellery demand of US$81 billion.
  • Investment demand, comprising bar and coin demand, ETFs and similar products, but excluding OTC investment demand, remained stable in 2010, down just 2% from the exceptional levels seen in 2009. This equated to a 23% rise in value terms from US$43 billion in 2009 to US$52 billion in 2010. Physical bar demand was particularly strong during the year, recording an annual gain of 56% at 713.2 tonnes.
  • Demand for gold ETFs and similar products totalled 338.0 tonnes during 2010 or 9% of total demand. Although this was 45% below the 2009 peak of 617.1 tonnes, it was nevertheless the second highest annual figure on record. As at the end of 2010, total gold holdings in ETFs and similar products stood at 2,175 tonnes with a US$ value of $96 billion.
  • Demand for gold used in technology was 419.6 tonnes, 12.4% higher than in 2009 as the electronics segment fuelled recovery in the sector, with demand returning to long-term trend levels. Demand soared by 41% year-on-year in US$ terms to a record US$17 billion.
  • India was the strongest growth market in 2010. Total annual consumer demand of 963.1 tonnes registered growth of 66% relative to 2009, which was largely driven by the jewellery sector. In value terms this was worth US$38 billion.
  • China was the strongest market for investment demand growth. Annual demand for small bars and coins increased by 70% year-on-year, totalling 179.9 tonnes, which is worth approximately US$7 billion.
  • Total supply is estimated to have increased marginally, 2% higher year-on-year for the full year 2010, with a number of new projects across a range of countries and regions contributing to higher levels of mine supply. Within total supply, recycled gold, which accounts for 40%, fell 1% compared with the previous year to 1,653 tonnes.

The Gold Demand Trends report sets out the key factors that drove gold demand in 2010,but also provides an outlook for 2011.

This is the main trends:

  • The jewellery sector enjoyed a strong recovery in 2010, with annual demand 17% higher than in 2009. Asian consumers drove jewellery demand, particularly in China and India. Chinese demand is expected to continue to increase rapidly during 2011 as economic growth in China remains strong, while Indian gold jewellery demand is likely to remain resilient and grow.
  • Asian consumers led demand with the revival of the Indian market and strong momentum in Chinese gold demand, which together constituted 51% of total jewellery and investment demand during the year.
  • A structural shift in central bank policy towards gold meant that in 2010 central banks became net buyers of gold for the first time in 21 years, removing a significant source of supply to the market.
  • Investment demand was down 2% compared with 2009, but was the second highest year on record at 1,333 tonnes, which equated to US$52 billion. Investment demand for gold as a foundation asset in portfolios is likely to remain strong, fuelled by ongoing uncertainty surrounding global economic recovery and fiscal imbalances, as well as fear of impending inflationary pressures and currency tensions.

“As anticipated, 2010 was a great year for gold with demand strong across all sectors. The opening weeks of this year have been characterised by an East/West divide. The dip in the gold price in January resulted in a reduction of ETF tonnage and a decline in the net speculative long position on COMEX. This has been counterbalanced by very substantial physical demand flows in Asian markets,” Managing Director at WGC, Marcus Grubb,  says.

The shift in central bank activity was the result of two distinct market forces.

Emerging market economies, experiencing rapid growth, have been large buyers of gold to diversify their external reserves. Meanwhile, European central banks have virtually stopped sales in the wake of the financial and European sovereign debt crises, the report states.

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Here’s a copy of the full report.

Related by the Econotwist’s:

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