What a revelation: Gold trading can rig currency markets

2:17p ET Saturday, December 12, 2009

Dear Friend of GATA and Gold:

Martin Hutchinson, business and economics editor for United Press International and regular contributor to PrudentBear.com, writes in his new commentary there, headlined "Sliding Back Towards a Gold Standard," that the Federal Reserve could regulate the dollar's value by buying and selling gold.

Hutchinson might have added that currency intervention also could be accomplished by leasing gold or by buying and selling gold futures, options, and gold derivatives.

Hutchinson's commentary is encouraging for acknowledging gold's centrality to currency intervention, and discouraging for failing to acknowledge that for years gold has been used largely surreptitiously by Western central banks for this purpose and indeed is being used for this purpose even now. But maybe he's just not yet aware of a few things -- like, for starters, the Fed's recent admission to GATA that it has gold swap agreements with foreign banks and that these agreements must be kept secret:

http://www.gata.org/files/GATAFedResponse-09-17-2009.pdf

Maybe Hutchinson could address this secrecy in his next revelatory essay.

You can find Hutchinson's new commentary at PrudentBear.com here:

http://www.prudentbear.com/index.php/thebearslairview?art_id=10318

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

* * *

To contribute to GATA, please visit:

http://www.gata.org/node/16