The Gold Chart That Has Central Banks Extremely Worried
Before I get into the details of this gold chart, I would like to let my readers and followers know about my recent interview on TFmetals Report. I sat down with Mr Ferguson (Craig) and discussed a lot of the Gold Market in a live webinar with many of his subscribers. He has now made the interview public:
You can click on the link below to listen to the inteview at the TFmetals Report website:
Shares of gold miners have more than doubled this year, crushing the 20 per cent gain in the precious metal and prompting investors such as billionaire George Soros to increase their bets on the sector.
Soros Fund Management bought a 1.7 per cent stake in miner Barrick Gold in the first quarter, worth $263.7m, according to a filing on Monday. Shares in the Canadian-listed company have surged 139 per cent so far in 2016.
As gold does not pay a yield like bonds or offer a divided like some equities, the precious metal has benefited from the current low and negative interest rate environment. A weaker tone for the US dollar after peaking in late January has also spurred a solid rebound in commodity prices.
Gold miners have also spent the last four years writing down billions of dollars in assets and cutting costs to reduce their debts after gold prices tumbled from their 2011 peak. Barrick Gold has cut its debt by nearly a third over the past 15 months.
“They’ve gone through a bad few years (the gold mining companies) but they seem to come out the other side,” said David Govett, head of precious metals at broker Marex Spectron. “They’re easier to trade and you don’t get the ridiculous fluctuations we see in the commodity price sometimes.”
India’s gold imports could hit a record high this year amid widespread smuggling to sidestep government levies on overseas shipments, Australia and New Zealand Bank, Asia’s biggest shipper of physical gold, said on Wednesday.
The forecast by the bank’s head of precious metals, John Levin, runs counter to tallies that show gold imports in decline in the world’s second-biggest gold market after China.
Mr Levin said he expects 15 per cent of India’s gold this year to be “smuggled in” or arrive via “other unofficial channels” to beat a 10 per cent levy imposed by the government.
Mr Levin also said more semi-refined gold, known as gold dore, was being imported from overseas mining companies because of a lower government levy. The import duty on gold dore is 8.5 per cent.
“You could see a record amount of gold going into India this year,” Mr Levin said, “A lot through unofficial channels and a lot of it going in as semi-refined gold.”
The desperation is obvious, palpable, incredible, fascinating, and unmistakable. History is being made, as the last ditch is overrun.The banker cabal wishes to defend an indefensible $1300 gold price and to defend an indefensible $18 silver price. The Gold price will find its true value and price over $10,000 per ounce. The Silver price will find its true value and price over $300 per ounce. Silver will be part of the new asset backed global currency system. NEXT COMES A GLOBAL LEHMAN MOMENT WITH BANK FAILURES AND A THREAT TO THE ENTIRE WESTERN BANKING SYSTEM…
Almost two weeks ago, On April 14, we reported the striking news that DB has decided to “turn” against the precious metals manipulation cartel by first settling long-running silver and gold price fixing lawsuits which in addition to “valuable monetary consideration” would expose the other banks’ rigging after DB also “agreed to provide cooperation to plaintiffs, including the production of instant messages, and other electronic communications, as part of the settlement.”
It was then that we also reminded readers that the US commodity “regulator”, the CFTC in 2013 closed its five year investigation concerning allegations that the biggest bullion banks manipulate silver markets and prices. It proudly reported in September 2013 that it found no evidence of wrongdoing and dropped the probe. This is what it said:
The Commodity Futures Trading Commission (CFTC or Commission) Division of Enforcement has closed the investigation that was publicly confirmed in September 2008 concerning silver markets. The Division of Enforcement is not recommending charges to the Commission in that investigation. For law enforcement and confidentiality reasons, the CFTC only rarely comments publicly on whether it has opened or closed any particular investigation. Nonetheless, given that this particular investigation was confirmed in September 2008, the CFTC deemed it appropriate to inform the public that the investigation is no longer ongoing. Based upon the law and evidence as they exist at this time, there is not a viable basis to bring an enforcement action with respect to any firm or its employees related to our investigation of silver markets.
Barely a day had passed since the historic admission of gold and silver price rigging by Deutsche bank, which as we reported on Thursday was settled with not only “valuable monetary consideration”, but Deutsche’s “cooperation in pursuing claims” against other members of the cartel, i.e., exposing the manipulation of other cartel members, and the class action lawsuits have begun.
Overnight, two class action lawsuits seeking $1 billion in damages on behalf of Canadian gold and silver investors were launched in the Ontario Superior Court of Justice.
The first class action alleges that the defendants, including The Bank of Nova Scotia, conspired to manipulate prices in the silver market under the guise of the benchmark fixing process, known as the London Silver Fixing, for a fifteen-year period.
More from the suit:
It is further alleged that the defendants manipulated the bid-ask spreads of silver market instruments throughout the trading day in order to enhance their profits at the expense of the class. This alleged conduct affected not only those investors who bought and sold physical silver, but those who bought and sold silver-related financial instruments.
Law enforcement and regulatory authorities in the United States, Switzerland, and the United Kingdom have active investigations into the defendants’ conduct in the precious metals market.
The case is on behalf of all persons in Canada who, between January 1, 1999 and August 14, 2014, transacted in a silver market instrument either directly or indirectly, including investors who participated in an investment or equity fund, mutual fund, hedge fund, pension fund or any other investment vehicle that transacted in a silver market instrument.
A copy of the Notice of Action can be found at sotosllp.com. Potential class members can register on the website to obtain more information as the case progresses.
The plaintiffs and the proposed national class are being represented by a national team of lawyers from Sotos LLP (www.sotosllp.com), Koskie Minsky LLP (www.kmlaw.ca) and Camp Fiorante Matthews Mogerman (www.cfmlawyers.ca) with offices in Ontario and British Columbia.
Earlier today when we reported the stunning news that DB has decided to “turn” against the precious metals manipulation cartel by first settling a long-running silver price fixing lawsuit which in addition to “valuable monetary consideration” said it would expose the other banks’ rigging having also “agreed to provide cooperation to plaintiffs, including the production of instant messages, and other electronic communications, as part of the settlement” we said “since this is just one of many lawsuits filed over the past two years in Manhattan federal court in which investors accused banks of conspiring to rig rates or prices in financial and commodities markets, we expect that now that DB has “turned” that much more curious information about precious metals rigging will emerge, and will confirm what the “bugs” had said all along: that the precious metals market has been rigged all along.”
This was confirmed moments ago when Reuters reported that Deutsche Bank has also reached a settlement in US litigation alleging the bank conspired to fix gold prices. In other words, hours after admitting it was rigging the silver market, it did the same for gold.
Some more headlines:
Reaches settlement in U.S. litigation alleging it conspired to fix gold prices.
Plaintiffs’ lawyers, in filing, say Deutsche Bank has signed a settlement term sheet
Plaintiffs’ lawyers say are negotiating formal settlement agreement that would be presented for judge’s approval later
Plaintiffs’ lawyers say settlement contemplates a monetary payment by Deutsche Bank
Gold settlement follows similar accord involving alleged silver price-fixing that was disclosed on Wednesday
Deutsche Bank admitted today that it participated with other big banks in manipulating gold and silver prices.
In 2014, Switzerland’s financial regulator (FINMA) found “serious misconduct” and a “clear attempt to manipulate precious metals benchmarks” by UBS employees in precious metals trading, particularly with silver. Reuters reported:
Swiss regulator FINMA said on Wednesday that it found a “clear attempt” to manipulate precious metals benchmarks during its investigation into precious metals and foreign exchange trading at UBS …
It is the participating banks themselves that administer the gold and silver benchmarks.
So are prices being manipulated? Let’s take a look at the evidence. In his book “The Gold Cartel,” commodity analyst Dimitri Speck combines minute-by-minute data from most of 1993 through 2012 to show how gold prices move on an average day (see attached charts). He finds that the spot price of gold tends to drop sharply around theLondon evening fixing (10 a.m. New York time). A similar, if less pronounced, drop in price occurs around the London morning fixing. The same daily declines can be seen in silver prices from 1998 through 2012.
For both commodities there were, on average, no comparable price changes at any other time of the day. These patterns are consistent with manipulation in both markets.
Back in July of 2014, we reported that in an attempt to obtain if not compensation, then at least confirmation of bank manipulation in the precious metals industry, a group of silver bullion banks including Deutsche Bank, Bank of Nova Scotia and HSBC (later UBS was also added to the defendants) were accused of manipulating prices in the multi-billion dollar market.
The lawsuit, which was originally filed in a New York district court by veteran litigator J. Scott Nicholson, a resident of Washington DC, alleged that the banks, which oversee the century-old silver fix manipulated the physical and COMEX futures market since January 2007. The lawsuit subsequently received class-action status. It was the first case to target the silver fix.
Many expected that this case would never go anywhere and that the defendant banks would stonewall indefinitely: after all their legal budgets were far greater than the plaintiffs.
Which is why we were surprised to read overnight that not only has this lawsuit against precious metals manipulation not been swept away, but that the lead defendant, troulbed German bank Deutsche Bank agreed to settle the litigation over allegations it illegally conspired with Bank of Nova Scotia and HSBC Holdings Plc to fix silver prices at the expense of investors, Reuters reported citing a court filing by law firm Lowey.
Terms were not disclosed, but the accord will include a monetary payment by the German bank.