At May 10 CMRE dinner, hear the guys who figured things out first


10:42a ET Saturday, April 28, 2007

Dear Friend of GATA and Gold:

The spring dinner meeting of the Committee for Monetary Research and Education, to be held in New York City on Thursday, May 10, should be of special interest to GATA supporters because of the appearance of two economists who figured out first nearly everything of the greatest interest to us: Peter Warburton and Henry C.K. Liu.

Warburton, director of the British research firm Economic Perspectives, is the author of the 1999 study "Debt and Delusion," an analysis of the uses and abuses of debt in the world financial system. Gold's friends and those particularly aggrieved by the rigging of the currency and commodity markets may know Warburton best for his 2001 essay, "The Debasement of World Currency: It Is Inflation, But Not As We Know It," which was posted at hard asset-oriented Internet sites, remains essential and timely, and still can be found at Gold-Eagle here:

For us, these were Warburton's crucial observations in that essay:

"What we see at present is a battle between the central banks and the collapse of the financial system fought on two fronts. On one front, the central banks preside over the creation of additional liquidity for the financial system in order to hold back the tide of debt defaults that would otherwise occur. On the other, they incite investment banks and other willing parties to bet against a rise in the prices of gold, oil, base metals, soft commodities or anything else that might be deemed an indicator of inherent value. Their objective is to deprive the independent observer of any reliable benchmark against which to measure the eroding value, not only of the U.S. dollar, but of all fiat currencies. Equally, their actions seek to deny the investor the opportunity to hedge against the fragility of the financial system by switching into a freely traded market for non-financial assets.

"It is important to recognize that the central banks have found the battle on the second front much easier to fight than the first. Last November I estimated the size of the gross stock of global debt instruments at $90 trillion for mid-2000. How much capital would it take to control the combined gold, oil, and commodity markets? Probably, no more than $200 billion, using derivatives.

"Moreover, it is not necessary for the central banks to fight the battle themselves, although central bank gold sales and gold leasing have certainly contributed to the cause. Most of the world's large investment banks have over-traded their capital so flagrantly that if the central banks were to lose the fight on the first front, then their stock would be worthless. Because their fate is intertwined with that of the central banks, investment banks are willing participants in the battle against rising gold, oil, and commodity prices."

Henry C.K. Liu's work may be best known to us because of his many recent and comprehensive essays in the Asia Times, also widely posted on the Internet. Lui has written that the explosion in financial instruments has obscured the distinction between equity and debt.

Other speakers at the CMRE meeting:

-- Forrest Capie, the official historian of the Bank of England. (Don't blame him for the bank's policies and practices; he just records them and puts them in context.)

-- James Turk, founder of GoldMoney, editor of the Freemarket Gold & Money Report, and consultant to GATA.

-- Erin Anderson, an expert on China and a Washington adviser to corporations.

-- Kevin Duffy, a director of Bearing Asset Management, a hedge fund.

-- And your secretary/treasurer.

The CMRE meeting will be held at the Union League Club, 38 East 37th St., New York City, a short walk south of Grand Central Station. Cocktails are offered at 5 p.m. and dinner, which is always wonderful at the club, will begin at 6.

Tickets are $155 for CMRE members and their spouses and $165 for others. Checks should be made payable to CMRE and sent in care of CMRE President Elizabeth Currier at 10004 Greenwood Court, Charlotte, North Carolina, 28215-9621, to be received no later than May 8.

More information is available by e-mailing Elizabeth at

I hope to see some of you there.

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

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