grovulent....your request answered

Grovulent

'Perhaps a gold bug here could enlighten me? What would it take to convince you that you are wrong? I need to know this in order to assess whether your theory is in fact falsifiable'

Good question and one I will attempt to answer

I've had a few hours to think about it and some or all of these would need to occur for me to change my mind. Before I start bear in mind throughout this that those (investment banks) who interfere with the gold price do so as agents of central banks. Now;

1. The consistency and frequency of the timing of the moves down changing. Very often 3pm Perth time gold falls $10 or so (has just happened again today beginning 3pm Gold down $15). This is the time London traders show up for work. There are also two times during NY sessions that show regular moves down. I saw a chart roughly six months ago where someone had overlayed all COMEX trading sessions on top of each other for the last 5-6 or so years. There was VERY clearly 2 occasions (on average) each trading day where gold fell off a cliff. It is rare for freely traded markets to act like this on a consistent basis.

2. The 2% cap on the upside to disappear. Go back over 10 years of data. You can probably count on two hands the times gold has moved more than 2% up in a session. Yet you would need a calculator to count how many times gold has hit a wall at 2% and begun to fall back. Apart from very recent times the DOW is the same on the downside.

3. In theory, in a freely traded market there should be a 'bell curve' of the closing price distribution (most action in the middle, even amounts at either end) For gold the distribution is weighted away from the high and towards the low of the day. (again it was a graphic I have seen and much as I would like to produce it as evidence I haven't a clue where it would be. No doubt buried in Le Metropole archives, but I have not the time sorry). This would need to change

4. A change in gold being down (regardless of bullish or bearish news) the day before clear $US bearish economic reports are recieved into the market. This happens with frightening regularity. Remember that the FED and Treasury recieve these reports the day before the public. You can also add to this one a change in the very counter-intuitive action in gold and the $US when $US bearish repports are released to the market. Again this happens far to regularly. I understand that markets are often counter intuitive but when for example jobs numbers are unexpectedly worse (far greater than market expectations - meaning they haven't been priced into the market) the $US rallies with a startling consistency and 'naturally' gold does the opposite. This would need to revert to a more 50/50 reaction to such news ie Gold rising half the time and falling half the time.

5. A significant reduction in precious metals derivatives held on the books by the alleged Cartel members (of which JP Morgan - the Fed's agent - holds an extraordinary amount). This occuring with a significant reduction in the price of gold indicating a liquidation of long gold derivatives would have me questioning things for sure.

6. The major investment banks are short gold. This is not in question. Often, many who don't agree with the manipulation 'theory' state that they are simply taking legitimate trading positions to make money. Fine, but profits could just as easily be made by taking 'legitimate' long trading positions on any correction in the gold price then running it up and closing those contracts on the move up. (they currently do the reverse on the way down - they establish shorts on the way up and cover on the way down). Why don't they do this? It would have the same effect if profits were the sole objective.

7. A full and transparent audit of the US gold reserves at Fort Knox which has not been undertaken in decades even though I believe congress has requested this on a few occassions. It would need to show a stockpile that was not significantly depleted.

8. A full and reasoned explanation of how Greenspan's follwong comments were not an admission of gold price supression:
'Central banks stand ready to lease gold in increasing quantities should the price rise'

http://www.federalreserve.gov/boarddocs/testimony/1998/19980724.htm

9. A full and reasoned explanation of why, in the lawsuit brought by Blanchard & Co against Barrick Gold and its bullion bank JPMorgan (Feb 03), Barrick stated 'that in borrowing gold from central banks and selling it, the company had become the agent of the central banks in the gold market, and, as the agent of the central banks, Barrick should share their sovereign immunity and be exempt from suit', if the central banks were not trying to supress the price of gold

http://www.lemetropolecafe.com/img2003/memoformotiontodis.pdf

10. A full and reasoned explanation of why the RBA would claim that "Foreign currency reserve assets and 'GOLD' are held primarily to support intervention in the foreign exchange market", if they are not using gold to intervene in markets. All but the GOLD bit is fine, but this is an admission that gold is used to intervene. Its in balck and white

http://www.rba.gov.au/PublicationsAndResearch/RBAAnnualReports/2003/Pdf/operations_financial_markets.pdf




I would say at least half of these would need to change/be explained for me to have serious doubts or change my opinion that the gold market is being intentionally suppressed.

So please feel free to assess whether 'the theory is in fact falsifiable.' I'd love to hear what you have to say.

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