A summary of GATA''s work and the suppression of the gold price


By Bill Murphy
January 26, 2002

Gold $278.60
Silver $4.30

John Brimelow on Thursday:

Further evidence that increased Japanese
offtake is real has appeared in a trade
journal discussing the increased activity of
bar smelting: click on:


Sceptics of hedging will be gratified to see
the recent Australian news item to the effect
that the creditors (not the equity holders)
of the Australian super hedger Centaur can
expect only 0.9 CENTS on the dollar:




* * *

Reading of Centaur's toxic hedges leads me to
the anti-gold company, toxic Barrick.

There have been two rumors floating around
for some time, which you might like to be
aware of because they have been confirmed by
my sources to be TRUE:

The first one is that Barrick was negatively
affected by the Enron mess. To generate
higher yields from its hedge book operations,
Barrick invests in higher yield bond funds.
By doing so, they are able to get better
returns on their forward sale programs. As it
turns out, Enron was one of the favorite
companies of these bond funds most liked by
Barrick. Barrick shareholders should not fret
too much on THIS count. The losses are not
that large and should not materially affect
Barrick in the end. Word to me is that
Barrick's pro-rata share of losses is around
$8 million, or 1 cent per-tax per ABX share.

The other rumor that has been confirmed is
that the IRS is auditing Barrick's accounting
of its offshore hedge book. Like Enron, they
pay little tax on their offshore hedge book
related profits. Whether Barrick has done
anything wrong, remains to be seen.It will be
most interesting to learn if any of this
affects Barrick's profits for last quarter.

GATA and Midas have been all over Barrick's
case for years concerning their role in
aiding the Gold Cartel's manipulation of the
gold price. Whether they are actually a
member in that cartel is a matter of
semantics. GATA's concern may soon shift to
investors around the world that still own
Barrick stock, the reasons being Enron and
J.P. Morgan Chase.

Barrick is very close to Morgan, and I mean
very close. Morgan's Toronto office is one
floor below Barrick's in Toronto. Morgan and
Barrick are seen together all around the

Not a week goes by that we do not learn more
and more of Morgan's incestuous relationship
with Enron. The investment world is waiting
for the details of that relationship. How was
Morgan funding Enron, why, for what, etc? The
Enron/Morgan article in the Wall Street
Journal was the first major step in that
direction. Will some of the coming
revelations lead right back to Barrick?

In the WSJ article, gold was mentioned. Why
was it really mentioned? Will we soon find

That line of thinking leads us to....


Who does not want to know the reasons that so
many Enron documents were shredded? J.P.
Morgan Chase and Goldman Sachs are the major
perpetrators of the gold scandal. They both
had significant dealings with Enron. Goldman
was to be Enron's partner in the electronic
gold exchange, for example.

Morgan was funding a significant amount of
the Enron operations. Were they funding Enron
with gold loans? Do those gold loans still
need to be repaid, which means physical gold
must be purchased somewhere? If not, Morgan
is out the gold and must take another big
loss? Who will do the buying to repay the
gold loans? Enron is broke!

Did Enron have their own gold loans, which
could be still outstanding? They paid
$450,000 to be LBMA members. Enron needed
money this past year to continue operations.
They obviously had the right connections to
know the gold price was fixed/manipulated.
Wouldn't have made sense for Enron to partly
fund their operations using gold loans in
their offshore accounts. Except for Japan,
where else were they going to borrow money
for about 1 percent?

The bullion dealer analysts often use the
term "mysterious seller" when reporting on
the day-to-day gold market trading action.
The Enron investigators just might stumble
into these "mysterious sellers" and
innocently report them to the world. Hello,
Gold Cartel!

My head is spinning. There are so many
permutations of all of this, I could go and
on. How does all of this relate to the
massive interest rate derivative $23 trillion
buildup at J.P. Morgan Chase? How does it
relate to the mysterious disappearance of the
Morgan gold derivative position in the third
quarter of last year?

The chief gold trader the past many years at
Chase was Dinsa Mehta. He was mentioned in
the WSJ Friday article. This is the same
Dinsa who called Frank Veneroso in a huff
after the GATA camp (Reg Howe) reported our
discovery of the massive gold derivative
increase at certain bullion banks as reported
by the OCC.

Somewhere in past Midas commentary, you will
find me relating how they called in several
accountants and were scurrying about
concerning the revelations. It caught Chase
by surprise and was most disturbing to them.

Smoke was bellowing from cabal headquarters.

One can go back even further to the sudden
shotgun marriage between Morgan and Chase. It
was done in very clumsy, quick fashion
reminiscent of the recent U.S. Treasury 30
yr. Bond announcement made by Peter Fisher.

See what I mean about head spinning. I
suspect the heads of the investigators will
be spinning to when they stumble into "The
Big Story."

Back to Barrick. They have been "dancing"
with the Gold Cartel and their politico
friends for many years, it will soon be time
for them to pay "The Fiddler." Barrick
shareholders beware!

Oh yes, George Bush Sr. is an ex-member of
Barricks's board. Vernon Jordan, Bill
Clinton's legal council is STILL on Barrick's
board ... as is ex-prime minister of Canada,
Brian Mulroney. The Big Story? It has to do
with the U.S. Government's running America
for the benefit of the big banks and not the
American people. It is what the gold
manipulation/scandal is all about. William
Grieder, who spoke at Ralph Nader's Fed
conference a few weeks ago, is getting close
to the gold scandal:

* * *

Crime in the suites;
There are more Enrons out there

By William Greider
The Nation
January 24, 2002

Instead of warning other banks of the rising
dangers, Chase and Citi led the happy talk.
Both have syndicated many billions in bank
loans to other commercial banks -- a rich
fee-generating business that allows them to
pass the risks on to others (federal
regulators report that the volume of
"adversely classified" syndicated loans has
risen to 8 percent, tripling the problem
loans since 1998).

These facts may help explain why former
Treasury Secretary Robert Rubin, now of
Citigroup, called an old friend at the
Treasury and suggested federal intervention.
Rubin's bank has a large and growing hole in
its own loan portfolio. Could the Treasury
Dept. please pressure the credit-rating
agencies, Rubin asked, not to downgrade

Though he styles himself as a high-minded
public servant, Rubin was trying to save his
own ass. Indeed, he called the very Treasury
official who, as an officer of the New York
Federal Reserve back in 1998, had engineered
the cozy bailout of Long Term Capital
Management -- the failing hedge fund that
Citigroup, Merrill and other major financial
houses had financed. Gentlemanly solicitude
for big boys who get in trouble connects
Washington with Wall Street and spans both
political parties....


* * *

Does that sound like Midas, or what? Finally,
the world is closing in on the Gold Cartel
and exposing their corrupt antics.

Meanwhile, the share price of J.P. Morgan
looks very shaky. It closed at 34.99, down
another point on Friday, breaking support,
while the banking index was rising. Not a
good sign. Is Morgan the next Enron?

Bill King of The King Report hit the nail on
the head in his latest:

* * *

In his Senate testimony, Easy Al stated,
"honesty is an important economic value,"
when queried about Enron. He also
rationalized Enron's ridiculously high value
as based on the company's reputation and
trust by the investing community. Al's too
humble. The ridiculous values of the bubble
peak are directly and indirectly his
handiwork. Al provided the excess liquidity
that fueled speculation, and Al's penchant to
bailout everyone diminished the 'moral
hazard' regulating factor. If the Fed hadn't
bailed out LTCM, Enron, most likely, wouldn't
have occurred as banks and brokers would've
been more vigilant. Al then demonstrated his
talent for equivocation by stating the U.S.
"may need some additional FISCAL stimulus,"
but the stimulus isn't critical for the
economy because it can recover on its own,
plus Al's afraid of deficit spending. The
"old Maestro" of BS, caught in his own
duplicity, had to admit he is
"conflicted" on the need for fiscal stimulus.
How about a straight forecast, Al?

* * *

It gets worse. If Al and Fed accomplices had
not facilitated the manipulation of the gold
price all these years, perhaps we would have
never had the Enron fiasco in the first
place. Perhaps 21,000 Enron employees would
still have their jobs, investors would still
have their money.

Two years ago, several well-meaning Cafe
members suggested that GATA not blow the
whistle on the Gold Cartel because exposing
fraud of this magnitude could devastate the
financial system and hurt many innocent
people. I argued vehemently that was
misguided thinking and compared it to letting
a cancer spread. My retort was that painful
chemotherapy treatment, or some kind of tough
healing approach, had to be better than
letting the cancer spread, leading to the
death of the patient.

But, that was only the tip of the iceberg why
the gold fraud must be ended.

At the GATA African Gold Summit, I made it
very clear of the duplicity and hypocrisy of
the likes of Clinton, Rubin, Summers, and
Greenspan and their role in the suppressing
of the gold price, which was contributing to
the death of so many Africans. Specifically,
I pointed to their support of the proposed
IMF gold sales that would dump 3,000 tonnes
of gold onto the market, an insidious ploy to
perpetuate their evil scheme.

If it were not for the Gold Cartel and this
bad lot of human beings, the price of gold
would be well north of $600 per ounce and
sub-Saharan Africa would be known as the
natural resource BOOM continent. Money would
be MUCH MORE plentiful. Instead:

* * *

Doctor: AIDS toll set to surpass Black Death

January 24, 2002

LONDON (Reuters) -- AIDS will surpass the
Black Death as the world's worst pandemic if
the 40 million people living with HIV or AIDS
do not get life-prolonging drugs, a public
health physician said on Friday.

The illness has killed 25 million people
since the early 1980s. An estimated 14,000
people are infected each day with HIV, which
destroys the immune system.

Without antiretroviral drugs, most people
living with HIV/AIDS will die, pushing the
death toll beyond the 40 million killed by
the Black Death that ravaged Asia and Europe
in the 14th century.

The illness has decreased life expectancy,
increased infant mortality and orphaned
millions of children -- particularly in Sub-
Saharan Africa, home to more than 28 million
HIV/AIDS sufferers.

* * *

I rest my case.

Meanwhile, the number of analysts and TV
pundits who reported that Alan Greenspan's
comment that the economy would be OK as so
important was pathetic beyond belief. They
sounded like schoolyard kids crying out in
pain after falling off a bicycle and asking
their mommy or daddy to tell them that all
would be OK.

They are deluding themselves with that kind
of pacifier. This is the reality:

* * *

NEW YORK (Dow Jones) -- The price/earnings
ratio of the Standard & Poors 500 Index
at the close of trading Wednesday was 39.85.

On Tuesday, the ratio was 39.54.

A year ago, the ratio was about 25.

The lowest price/earnings ratio on the SYP
500 came in the second quarter of 1949, when
the reading slipped to 5.9. Over the last
decrease, the low was 15.77 in the first
quarter of 1995.

The price/earnings ratio, known as the
multiple, is a measure of the average stock
price divided by the earnings per share.

* * *

The stock market is in deep trouble as is
J.P. Morgan Chase. As both disintegrate, the
pressure on The Gold Cartel will mount and
mount until the cabal blows up in complete

Why own gold? A tidbit From a Floridian Cafe
member, a foreshadowing of what is to come:

* * *

FYI. Brought my Quicken past 1/1/02, got a
Report -- just curious -- on our "groceries"
category for 2001. Q allowed me to "compare"
with the year before.

Increased 26.7 percent.

Can't be, I sez. Check "dining," I sez.

Increased 25.8 percent. (This was mostly
pizza. I pick it up. Retired, don'tcha know)

Now: How much did the CPI increase in 2001?

Don Rood
Fort Myers, Florida

* * *

There is a new gold web site in Australia:


"The Gold Report is an independent service
that will provide investors with a way to
assess the potential of Australian listed
companies that have exposure to gold
projects. Our database holds information on
270+ companies.

"The Gold Report will demystify the gold
sector by providing an understanding of gold
projects in layman's terms."

* * *

I spoke with U.S. Rep. Ron Paul's staff this
week to inquire about his coming bill that
will request the Exchange Stabilization Fund
to disclose its gold operations to Congress.
The language of the bill is being worked over
and it should be ready in a few weeks, max.
The name for the bill is a killer: "The
Monetary Freedom and Accountability Act."

Who can be against that besides The Gold
Cartel? U.S. Treasury Secretary O'Neill?

Stay tuned next week for the latest
concerning GATA and the Monetary Freedom and
Accountability Act.

Meanwhile, for the latest from Congressman

* * *

"World Trade Organization Demands Change in
U.S. Tax Laws" is the title of Paul's current
weekly column. To read it, go here:


Excerpts from the column:

"Many Americans already have grave concerns
about the loss of sovereignty inherent in our
participation in global government
organizations like the U.N. and the WTO. Few
understand, however, the extent to which
Congress already capitulates to the
globalists when it writes the laws that
affect all of us.

"Incredible as it seems to liberty-minded
Americans, the WTO and the Europeans are now
telling us our laws are illegal and must be
changed. It's hard to imagine a more blatant
example of a loss of U.S. sovereignty.

"This latest affront to our sovereignty makes
it clear we must get out of the WTO if we
hope to avoid further international meddling
in our domestic affairs.

"Congress may not object to being pushed
around by the WTO, but the majority of
Americans do."