I completed
writing my April issue of GOLDVIEW in the early afternoon of Friday, April 12 –gold
was $1545- and went out for my usual social gathering with my friends to celebrate
the forthcoming weekend. I was planning to send in the issue for posting on the
net upon my return. When I came home, I checked the markets and the gold price
and I got a shock like I was stricken by lightning. I thought there was
something with my eyes, seeing a gold price of $1503 but after focusing, I
realized it was true. Something terrible or unexpected must have happened in
the world. Another European country heading for bankruptcy? Or the opposite,
the EU announcing that all financially stressed countries would be saved? The
United States reporting spectacularly positive economic news? The Fed
announcing that they would make prompt and full delivery of other countries’
gold? China announcing that it would no longer accumulate gold? But no, there
was nothing in the world news that could be the reason for gold to go to $1503
and to subsequently close at $1477.00, a dramatic decline bound to be
remembered in the history of gold. Also an event that kind of ridiculed
everything I wrote in my editorial today and that was asking me to respond to.
I am not only
shocked and amazed. Yes, it confirmed what I wrote in my editorial of this
issue, that funny things are happening and are hard or even impossible to
believe and certainly difficult to understand. What on earth must have happened
to justify a decline of the gold price like this? And immediately the next
question comes up. What kind of transactions has resulted in such a heavy blow?
And who initiated this massive attack –I can’t find another name for it- and
where did the money come from? Yes, money and not gold. But as appeared
quickly, the downfall of gold was not caused by the sale of enormous amounts of
physical gold. But instead, it was an enormous volume of paper gold contracts
that were sold, catching the market by surprise.
The Financial
Times said it was instigated by the Goldman Sachs turn to negative and their
recommendation to clients to go to “short” gold, a bearish bet. The bank
published their year-end targets of $1450 in 2013 and $1270 in 2014, stating “We see risks to current
prices as skewed to the downside as we move through 2013” and adding that “the
fall in prices could end up being faster and larger than our forecast”. As
reason for their forecast, the bank cited expected US growth later this year.
As was rumoured, Merrill Lynch stunned the markets
right at the opening by selling massive gold futures contracts, estimated to
have been over 500 tons of paper gold, according to London monetary metals
trader Andrew
Maguire who also said
that huge volumes of physical gold were moving to China amid the pounding of
the gold price in the futures market. He added “It is pure short selling”. Another
contribution to the ordeal came from ECB’s Mario Draghi who said that
while Cyprus doesn’t have to sell its gold, any money that would come out of a
sale must go towards covering the losses from the emergency loans to the
country’s banks. One explanation came from the former Assistant Secretary of
the US Treasury, Dr. Paul Craig Roberts: Dr.
Roberts: “This smash in gold is an orchestration by the Fed. It's
been going on now from the beginning of April. Brokerage houses told
their individual clients the word was out that hedge funds and institutional
investors were going to be dumping gold and that they should get out in
advance.” GoldStockBull’s Jason Hamlin
commented: “I have no problem with corrections in general, as they are a
healthy part of any bull market. But something is not quite right about the
recent price action in precious metals as the markets have become increasingly
divorced from reality over the past few months.
I am sure that
as from Monday, many comments about the April 12 collapse will come forward
from all sides. Of course, I will try to keep up with all of them and if I have
the time and opportunity while I am at the European Gold Forum in Zurich, I
will post some of the most worthwhile on the European Gold Centre page at
Facebook and relay that via the social media.
As I said, I am
not only shocked and amazed. I am also angry. If any ‘normal’ scam defrauds
people for small amounts, it is marked as a crime. So why is a will-fully
organized and orchestrated multi-billion market action aiming to make a
speculative profit at the expense of billion dollars losses to others not
marked as an act of criminal conduct? I think the world deserves a very good
explanation to get the proper insight in what really happened. In this era of
transparency, the masterminds behind this insane and extraordinary market
action should be found, revealed and judged. I am pretty sure that those who are
responsible for this historic market action would make Bernie Madoff pale…..
GATA, THERE
IS WORK TO DO!!!
My answer to the question that I put on top of this
last minute addition to this GOLDVIEW issue, I say:
GOLD WAS NOT KILLED, IT WAS ONLY HURT,
GOLD IS BOUND TO SURVIVE,
GOLD WILL HAVE A GREAT FUTURE,
IT
ONLY WILL TAKE SOME MORE PATIENCE.
To end this special
editorial, I share two of the quotes with you that appeared earlier today:
Former Assistant of the US Treasury, Dr.
Paul Craig Roberts
"The exchange
value of the dollar is threatened and if that collapses the Fed loses control
over interest rates. Then the bond market blows up, the stock market blows up,
and the banks that are too big to fail, fail. So it's an act of desperation
because they've got to establish in people's minds that the dollar is the only
safe place, it is the only safe haven, not gold, not silver, and not other
currencies."
Jeffrey
Nichols – NICHOLSonGOLD.com
“Gold prices were driven
insanely lower today -- not by market fundamentals or the latest readings on
the U.S. and global economy -- but by technical and computer-driven program
trading mainly in futures, forward, and options markets.”
Who said markets are always
rational? Indeed, the stars remain favorable for gold and rational analysis
suggests that prices will go significantly higher over the next few years. I've
written and talked at length about gold's very sane bullish fundamentals.
I have never been so eager to go to Zurich to attend the European Gold Forum and sense the atmosphere among the attendees about what happened to gold
today. I already knew we would be facing exciting times but I could not possibly suspect that it would be exciting because of this reason……I will keep you
informed about what I hear, see and feel. Keep the faith and stay awake.
Henk J. Krasenberg
PS: Oh, and please have a look at what I found the
same famous Friday
IF THEY FIND
OUT THE TRUTH AND WAKE UP, I’AM SCREWED!!!!
www.thebullionblog.com
