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For anyone who cares, here’s a snippet of the
history on how the price of gold gets “fixed” in London each
and every day;
LONDON - The
financial district known here simply as The City is a hotbed of the loyal
Order of the Masons, who have a penchant for strange rituals. But Masonry has
nothing to do with an odd little ceremony performed twice every day in an
office at N.M. Rothschild & Sons Ltd.
Five men talk
on their phones for 10 minutes or so, and then lower tiny Union Jacks sitting
on their desks. And that's it. The London gold fixings is complete. It takes
place at 10:30 a.m. and 3 p.m., like clockwork. The same ceremony has been
performed the same way, in the same place, and with mostly the same firms
participating since the first gold fixing was enacted at Rothschild in St.
Swithin's Lane on Friday, Sept. 12, 1919.
But gone are the days when Rothschild ruled the daily
fixes [a.m. and p.m.] in gold--they quit the market on April 8, 2004:
Rothschilds
Quit Gold Market & London Fix
The London
Gold Fix has been a regular feature of the international gold market since
Friday, September 12, 1919, when the five gold pool members met for the first
time, at the premises of the London merchant bank N.M. Rothschild, and with
Rothschild as the chairman. On April 8th 2004, N.M. Rothschild announced
that it was withdrawing from the gold market.
On the morning
of Monday 5th May 2004, gold was fixed as usual, but by a telephone
conference between three market member in London and one in Paris.
A Tough Fix?
The longest
fixing--the P.M. fix of Oct. 19/87--lasted for 2 hours and fifteen minutes
[which means that the price was not fixed until 5:15 p.m. GMT] when the stock
markets crashed on Black Monday in late October [19th] 1987.
Most people old enough to remember know that global
stock markets "crashed" over 20% on Monday, Oct. 19, 1987. What
most people forget is that North American equity markets [the DOW] had
declined by a little more than 100 points [4.6%] on Friday, Oct. 16, 1987. The
Friday Oct. 16, 1987 equity market decline was precipitated by a sell-off
[rates rising] in the bond market.
From personal experience working on a trading desk at
the time, I remember that the price of gold had DRAMATICALLY risen before
6:30 a.m. ET Monday morning [the huge price increase had occurred Monday,
Oct. 19th at the London a.m. fix] LONG BEFORE North American Equity
markets opened. I can attest to the fact that the "buzz" in global
markets that morning was the dramatic rise in the gold price from Friday
afternoon to Monday morning.
What This all Means
So, are we to believe that a 100 point drop in the DOW
produced a 14.25 per ounce lift in the price of gold and a 300+ point drop
only produced a paltry 1.25 per ounce increase--after a record 2-1/4 hour
delay--when the financial world was seemingly coming apart? The DELAY in
fixing the price of gold at the p.m. fix on Oct. 19th, 1987 is clear evidence
that NO ONE in their right mind would sell gold.
They couldn’t find ANY sellers at prevailing
market prices--the market couldn’t clear.
A dramatically higher price which would have allowed
the gold market to "clear" would have sparked additional fear and
further damage in the bond market.
Ergo, the delay can ONLY be logically explained in that
enough Central Bank gold had to be mobilized to suppress the gold price rise
giving the false appearance that "all is well" in our systemically
broken, irredeemable fiat money system.
Forensic Examination: The Historic Mechanics of
the Gold Price Fix
If at the
opening price there are only buyers or only sellers, or if the numbers of
bars to be bought or sold does not balance, the price is moved and the same
procedure is followed until a balance is achieved. The Chairman then
announces that the price is fixed. It should be noted that the Fix is said to
balance if the buy amount and the sell amount are within 25 bars of each
other. The Fixing will last as long as it is necessary to establish a price
that satisfies both buyers and sellers.
Gold price suppression has been practiced by monetary
elites--Central Banks--for a great deal longer than virtually anyone cares to
admit. The history of the London Gold Pool and other episodes like October
1987 provide evidence that when economic times get challenging or tough
– gold price suppression is usually evident. With the well documented
economic/financial challenges we are experiencing today – would any of
you really want to bet any of your money that the gold price is not being
manipulated?
Rothschild exited the gold market back in April 2004.
The reasons given at the time were to the effect that there “was no
money in it”. Today the price of gold is in excess of 1,200 per ounce.
Did Rothschild get insanely rich by being dumber than dumb?
Do you really believe there was no money in it?
On an ongoing basis, evidence continues to mount that
the gold price is still managed and manipulated. We see the entrails of this
price management through Central Banks refusal to answer pointed questions
regarding their activity in the Gold Swap Market [a widely misunderstood
activity that broadly allows Central Banks to 'double count' the amount of
gold bullion they report to have in their vaults]. We also see evidence of
this activity through massive concentrations of "short
positions"--held by Central Bank friendly commercial banking
institutions--on exchanges like COMEX, where so called paper gold [futures]
are traded. But most of all, we see the entrails of gold market price
suppression in the physical market--the Achilles Heel of price rigging--where
widely reported premiums are being paid for physical bullion and where the
U.S. Mint continues to have difficulties meeting their Constitutionally
mandated obligations of supplying the market with adequate stocks of gold and
silver American Eagle coins.
Got physical gold yet?
Rob Kirby
KirbyAnalytics.com
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