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Published on Gold Anti-Trust Action Committee (http://www.gata.org)

Panic buying of gold in Tokyo as Australia catches gold fever

By cpowell
Created 2002-12-18 08:00

COPYRIGHT 2002, www.LeMetropoleCafe.com [1]
Used by permission

'MIDAS' COMMENTARY FOR DECEMBER 18, 2002

By Bill Murphy
www.LeMetropoleCafe.com [2]

Gold $341.80, up $4.60
Silver $4.66, up 3 cents

It has taken GATA four years, but the effort
of the GATA army has paid off. We are routing
the Gold Cartel, the most powerful and
wealthiest people in the world. The battle
plan put in place so long ago is winning the
day. For new Cafe members, that constantly
worked plan was based on the "enveloping
horn" strategy of Zulu warrior Chieftain
Shaka, Africa's greatest general.

Gold has been on a tear ever since the
Howe/Bolser report was published at
www.GoldenSextant.com [3] and brought to the
attention of the investment world by MIDAS
and GATA. MIDAS Headliners:

12/5: Howe/Bolser report stuns gold
investment world.

12/6 O'Neill and Lindsey resign after reading
Howe/Bolser gold report.

Then Frank Veneroso's latest gold report
surfaced and was circulated all over. Frank's
report on the massive gold short position of
the bullion/central banks confirmed Reg
Howe's analysis. What is amazing is that they
came up with the same result using completely
different methodologies. The big money is
reading these reports. You don't need to be
an Einstein to realize that once this cat is
out of the bag and understood in the
mainstream investment world, a massive gold
short squeeze will be inevitable. The smart
money has been handed two brilliant analyses
to give them the conviction to take on the
Gold Cartel.

That is just what is happening. You can tell
that by watching the Comex market action.
These smart-money buyers are toying with the
cabal shorts. They know they have them and
are waiting to pounce on the cabal on the
close almost daily.

Look at what gold has done since the
Howe/Bolser report was released:

http://futures.tradingcharts.com/chart/GD/23 [4]

Coincidence? I don't think so.

Today was a sight to behold. Right from the
get-go, you could tell gold was going to
roar. The cabal tried to take down gold all
night and morning, but it was obvious they
were not going to succeed. Yesterday's
dramatic selloff then became a positive as
today's early action showed the shorts to be
in big trouble. Sure enough, once again the
smart money buying crowd stuck it to the Gold
Cartel on the close.

The cabal has now lost their last line of
defense, that being $340 resistance. For the
last two days they gave it all they had to
try to take gold down. They were whipped! We
still do not have any gaps to fill on the
downside. We still do not have that upside
breakaway gap, followed by a buying panic in
the United States. That could come any day
now.

Word was sent my way today that option books
are blowing up because of the sharp move up
in the gold price. There is no telling what
the gold price could do on the upside. That
$10, $20, $30 up day could be at hand.

Collectively, the shorts are on the hook for
some 15,000 tonnes of gold. Mine supply is
only 2,500 tonnes per year and shrinking. How
are they going to pay the loans back? Where
are they going to get the gold? Only one way:
Gold must rise hundreds of dollars per ounce.
Then the women and peasants of the world will
bring their scrap gold in jewelry form to
market.

What fun! The dumkopf, arrogant Western
bullion bankers need to be bailed out by the
peasants. Couldn't happen to a nicer bunch of
guys.

Is the GATA gold story really making the
rounds? GATA's Ed Steer sends us this:

* * *

Bill, I took this paragraph from Wexford
Capital's December 16 commentary.

"The breach of the $330 level in gold has got
to have the bullion banks, forward sellers,
and gold bears in general smarting from the
paper losses. Based on what I have read over
the last five years, I would venture to say
that the current push of gold prices north
may entail tens of millions of dollars of
losses for the bullion banks in particular,
if not hundreds of millions of dollars. Since
this market is not transparent -- as many
U.S. trading markets are not, to the
detriment of the small investor -- it is
difficult to put a specific number on the red
ink flowing from the short positions on gold
bullion, but one can reasonably assume the
number is quite big.

And in relation to equity on the books of
such stellar corporate citizens as J.P.
Morgan Chase, it is a company killer or
insolvency inducing situation. Of course,
only time will tell, and the crapola would
have hit the fan years ago except for the
inside track that these campaign fund
stuffing aristocrats enjoy through the Halls
of Power. But no market will stay manipulated
forever, and we have reached and surpassed
that critical point in both the gold and
silver markets. Talk is cheap, so stay glued
to the commodity tape, and put a few ounces
of the precious stuff in your stocking for
the holidays. Will keep much better than
snack food.

* * *

Then this:

"Bill, CNBC interview with Phillip Gotthelf,
president of Equidex, mentioned the massive
gold short covering issue. Goes public! Best,
John."

* * *

How ironic! Gotthelf mocked GATA these past
years. Now, he gets on the tube presenting
our case as the Howe/Bolser and Veneroso
reports are circulating all over the
investment world. Where has he been these
past years?

Gold supply news:

"The Australian Bureau of Agricultural and
Resource Economics also lowered its estimate
of 2001/02 national gold yield by seven
tonnes to 264 tonnes from 271 tonnes. Gold
production in Australia, the world's number
three gold mining country behind South Africa
and the United States, peaked at 318 tonnes
in 1997/98. Analysts have blamed the steady
decline since on less exploration work, which
slowed the pace of new mine development."

This could not have come out a better time:

* * *

Barrick Gold Corp. And J.P.Morgan Chase & Co.
Accused Of $2 Billion Illegal Gold Market
Manipulation

NEW ORLEANS, La. -- An anti-trust lawsuit
filed today accuses Barrick Gold Corp.,
Toronto, and J.P. Morgan Chase & Co., New
York City, of "unlawfully combining to
actively manipulate the price of gold" and
making (US)$2 billion in short-selling
profits by suppressing the price of gold at
the expense of individual investors.

The suit was filed by Blanchard and Co. Inc.
of New Orleans, the largest retail dealer in
physical gold in the United States, and by
Blanchard clients who bought gold bullion.
Blanchard (www.blanchardonline.com [5]) is paying
the costs of the suit, which asks the federal
court to terminate the trading agreements
between Barrick and J.P. Morgan Chase and
other, as yet unnamed bullion banks.
Blanchard believes its clients have suffered
substantial losses as a result of Barrick's
and J.P. Morgan Chase's unlawful price
manipulation, anti-trust violations and
unfair trade practices.

* * *

As Chris Powell said in his GATA dispatch
today: "GATA has been in contact with
Blanchard & Co. in recent weeks and will
assist the lawsuit in any way we can."

Talk about vindication for the GATA Army and
our four years of effort to expose the gold
fraud. For Blanchard and Co.:

HIP-HIP, HOORAY!
HIP-HIP, HOORAY!
HIP- HIP, HOORAY!

It appears that Barrick's stock caught the
GATA flu, finishing the day at $15.80, down a
dime on a $5 up day for gold. All other gold
shares were higher. May Barrick feel the
wrath of the Shaka philosophy: Make friends
or you will be destroyed. Barrick chose their
course. May they be buried for all the harm
they have done to so many innocents in the
world.

The news of the gold price manipulation
lawsuit has caught fire. The press is all
over it. Surely, it helps to have gold flying
as this news is breaking:

* * *

"Hi, this is Dave Skarica editor of
www.addictedtoprofits.com [6], writer for
www.timingwallstreet.com [7] and good friend of
Bill Murphy at GATA. I just wanted to inform
Bill and the people at GATA that I learned
about the lawsuit against American Barrick
and JP Morgan through a news flash on ROB-TV,
the Canadian version of CNBC). Right now it
is third on their list of headlines on
www.robtv.com [8]. Keep up the good work, guys,
and remember there are golden skies ahead!

"Sincerely, Dave Skarica"

* * *

Once again, I cannot stress enough the most
important consideration regarding the gold
price is the manipulation issue. Next is the
increasing demand for physical gold. All
other factors are subordiate to the first
two.

The subordinate factors supporting higher
gold prices are:

* a weaker dollar

* low interest rates

* negative real interest rates

* rising commodity prices

*weak stock markets.

The people who do not "get it" regarding
gold's price manipulation really know nothing
about the gold market. They may think they
do, but they are clueless.

Gold rocked today with the dollar steady,
steady commodity markets, and the stock
market slightly lower. Oil did make new
highs, rising to $30.37 per barrel, but other
commodity prices were tagged.

Stock market players won for so long, many
cannot bear to get out of their increasingly
losing positions. Gold share investors have
lost so long, they cannot wait to take
profits and get out of their positions. These
investors must be oblivious as to what is
coming for the gold price and why.


Source URL:
http://www.gata.org/node/1663