Real gold or paper gold -- which do you own?

Section:

9p ET Thursday, August 5, 2010

Dear Friend of GATA and Gold:

Zero Hedge today went after the gold price suppression scheme again, this time in commentary by Michael Kreiger. He wrote:

"Anyone who doesn't understand that the Comex is a manipulated illusion isn't paying attention. More and more investors around the world are coming to understand this, which is why there is a movement into the physical. Real gold versus paper gold -- which do you own?

"The article in the Financial Tiems the other day that seemed to uncover the mystery of the BIS gold swap is required reading:

http://www.ft.com/cms/s/0/3e659ed0-9b39-11df-baaf-00144feab49a.html

"Here is one excerpt:

"'The gold used in the swaps came mainly from investors' deposit accounts at the European commercial banks. Some investors prefer to deposit their gold in so-called 'allocated accounts,' which restrict the custodian banks' ability to use the gold in their market operations by assigning them specific bullion bars. But other investors prefer cheaper 'unallocated accounts,' which give banks access to their bullion for their day-to-day operations.'"

"The banks identified in the swaps were HSBC, Societe Generale, and BNP Paribas. First of all I think it's insane for anyone to have gold within a bank. The entire purpose of gold is to escape the banking system once it becomes so big, complex, and fraudulent that there is no place to go but collapse upon its Ponzi scheme structure.

"I smell a rat in this BIS deal. People are not going to be happy when they try to redeem their paper gold. I can't tell you how many people I know who are selling [exchange-traded fund] GLD (HSBC is the custodian!) and buying physical. Of great significance is also the fact that on every orchestrated Comex plunge physical buying accelerates.

"As an example, the U.S. Mint reported selling only 85,000 coins in the first 21 days of July but then sold 57,000 in the last seven days of the month. This sort of behavior is what will limit the downside. There are enough smart people with lots of money who see the current system for the fraud that it is and are getting out while physical gold is still available."

Krieger's commentary is headlined "Russia Bans Grain Exports as the End Game Trade Begins" and you can find it at Zero Hedge here:

http://www.zerohedge.com/article/guest-post-russia-bans-grain-exports-en...

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



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