golds going higher currently being manipulated, page-32

THE NOT-SO-INVISIBLE HAND:
HOW THE PLUNGE PROTECTION TEAM KILLED THE FREE MARKET

Ellen Brown
October 25, 2008
Le Metro Cafe

Plunge Protection for Some, Plunge Creation for Others

The most egregious examples of market manipulation have been in gold, silver and oil. The official “spot” (or cash) prices of gold and silver were taken down sharply in the last ten days, despite the fact that physical demand has been inexorable. Gold is available in the “real” market only at huge markups, and popular types of silver are not available at all.1 We were taught in school that communism does not work because when industry is in the hands of a single owner (the government), competition is eliminated and chronic shortages and black markets develop, since the government does not let prices respond to “supply and demand” but dictates them from the top. Today this is happening with gold and silver, with the true physical price varying radically from the reported paper price.

Gold is known as the “contra-investment,” the “go to” investment which historically has gone up when other stocks were failing. Investors see it as something tangible that will hold its value when everything else is falling apart. For that reason, rigging the market to “maintain stability” means suppressing the price of gold.

The current round of gold manipulations started on Thursday, October 16, at 10 am, when the price of gold suddenly suffered a freefall plunge of $45 within minutes. It continued to drop until it was down by nearly $60 in a little over an hour:



Nothing happened on Thursday between 10 and 11 am to warrant this vertical drop. If anything, gold should have been shooting up in the same exponential fashion that it was falling. On Wednesday, the stock market had dropped over 700 points, and Dow futures (bets on which way the market would go) were down by 150 points Wednesday night. During the night, the Japanese stock market fell more than 10%, and all European markets were down.2 Thursday morning, among other very bad economic news, U.S. industrial output was reported to have posted its biggest fall in 34 years, and mid-Atlantic factory activity had crashed unexpectedly from September to October. Yet Dow futures were suddenly 130 points higher; and gold was slammed down right at 10 am, although physical gold was available only by paying huge premiums, and gold prices around the world were shooting up. The day continued in the same counterintuitive way, just one more egregious example of an ongoing pattern of manipulation that has become so blatant that either the manipulators have become supremely confident of their invulnerability or they are so terrified of impending doom that all pretense of plausible denial has been abandoned.