French central bank secretly trades the gold market almost every day

Section:

5:47p ET Friday, December 13, 2013

Dear Friend of GATA and Gold:

The French central bank trades gold for its own account "nearly on a daily basis" and is "active in the gold market for central banks and official institutions," a bank official told a conference of the London Bullion Market Association in Rome on September 30.

The official, Alexandre Gautier, the Banque de France's director of market operations, added that the bank is considering returning to the gold lending business. He implied that the bank's objectives in the gold market are simply allocation of foreign exchange assets and earning ordinary profits on trading rather than intervention in the currency or gold markets.

A transcript of Gautier's remarks to the LBMA conference has been posted at the organization's Internet site here:

http://www.lbma.org.uk/assets/Gautier%2020130930.pdf

And at GATA's Internet site here:

http://www.gata.org/files/BanqueDeFrance.pdf

In contrast, the deputy chief of market operations for Germany's Bundesbank, Clemens Werner, told the LBMA conference that at the German central bank "there is no active management of gold reserves, no buying and selling every day." Werner added that only 9 kilograms of the Bundesbank's gold is held as a mere paper claim -- unallocated metal. This suggested his confidence that the German gold vaulted at the Federal Reserve Bank of New York remains there unencumbered, though the Bundesbank's announcement this year that it will take seven years to repatriate only 20 percent of its gold at the New York Fed has raised suspicions.

... Dispatch continues below ...



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Werner said that after 1999 "there were several attempts and some pressure for the Bundesbank to sell gold" but these were resisted.

A transcript of Werner's remarks is posted at the LBMA's Internet site here:

http://www.lbma.org.uk/assets/Werner%2020130930.pdf

And at GATA's Internet site here:

http://www.gata.org/files/Bundesbank-LBMA-Rome.pdf

Another presentation to the LBMA conference might have been very interesting -- that of the chief of the customer banking division of the Bank of England, Matthew Hunt, whose topic, according to the conference program, posted at the LBMA's Internet site here --

http://www.lbma.org.uk/pages/?page_id=159&title=programme

-- was "The Bank of England's Gold Vault Operations."

For back in July GoldMoney research director Alasdair Macleod identified what appeared to be a 1,200-tonne discrepancy in the Bank of England's custodial gold data, a huge decline in custodial gold that seemed to coincide with the smashing of the gold price in April. The Bank of England peremptorily refused your secretary/treasurer's request to explain the discrepancy:

http://www.gata.org/node/12859

Yesterday by e-mail your secretary/treasurer asked the Bank of England to provide a copy of Hunt's presentation to the LBMA conference. No reply has been received yet.

Some conclusions may be drawn here:

-- Central banks participate in the gold market every day and on the whole are the biggest participants but they fail to disclose their trading and it never figures in the market reporting of mainstream financial news organizations or the commentary of most market analysts. For the most part those news organizations and analysts, ignoring central bank activity, are interpreting mere holograms and attributing market moves to mere concoctions. Indeed, central banks are never questioned at all by news organizations and analysts about their activity in markets.

-- While they are government institutions, the Bank of England and the Banque de France conduct or plan to conduct business in the gold market on behalf of private clients.

-- As demonstrated by their participation at the LBMA conference in Rome, the Bank of England and Banque de France share with those private clients information that is not made available to other market participants or to the public generally. That is, in serving their clients the banks are likely advancing some secret government policy, policy that includes influencing the markets surreptitiously if not rigging them outright.

The documents cited here seem to have been brought to light first by the market researcher who operates the Another Free Gold Blog:

http://anotherfreegoldblog.blogspot.nl

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

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LBMAProgramRome.htm_.txt53.64 KB
BanqueDeFrance.pdf46.59 KB
Bundesbank-LBMA-Rome.pdf46.62 KB