Hailey strikes a blow for gold by republishing "The Moneychangers"


3:33p ET Friday, November 23, 2001

Dear Friend of GATA and Gold:

Two of our friends recently raised with me by e-mail an issue
that may be on the minds of others.

The first wrote: "Has anyone ever thought that when the media
start saying that the gold market is manipulated to control spot
prices, your average investor would take this as a reason to stay
away from gold? Sometimes one can't even win for winning!"

The second wrote: "Unfortunately, an increasingly widespread
knowledge of the manipulation will likely work to gold's detriment.
The masses are easily influenced by government activities they
perceive. They will not have the insight to expect that a
suppressed market will eventually rebound with more vigor, but
rather will tend to believe there can be no rebound while the
government is keeping the pressure on. So their natural tendency
will be to reduce purchases of gold coins and other gold items."

Yes, if the world began to realize that the gold price was being
suppressed by the U.S. government and its agents the Wall Street
financial houses, investors would react. But they might react in
a way favorable to gold.

That is, investors might come to believe that, except by clever
short-term trading on the basis of inside information, there was
no way to make money by going long on gold paper. If so, those
who wanted gold itself rather than gold paper might migrate away
from the largely paper exchanges to the spot market and buy only
physical gold. Then the price for gold paper might fall even as
demand for physical gold might remain steady or even rise. And
the separation of the paper price from the physical price would
be a big blow to the manipulation, paper being much easier to
manipulate than heavy bricks of gold.

In any case, the real purpose of the gold suppression scheme
seems to be the suppression of interest rates. And when it is
realized that the gold price is manipulated to falsify economic
indicators generally, interest rates may take their cues
elsewhere. That already may be happening.

Maybe GATA's expectations are wrong. But our charter is to
advocate and litigate for free, unmanipulated, transparent
markets in gold and related investments, markets in which the
powerful have less advantage over the small, no matter the
results that a liberated market will have on price. We believe
that our work will result in a higher gold price, but whether
it does or not, our purpose, beyond even a higher gold price,
is a free and fair market in gold and everything related to it.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.