You are here
British university study confirms gold market manipulation protects U.S. assets
No Place to Hide: How Market Manipulation in the Age of Pandemic is Destroying Traditional Safe Havens
By Neil Vowles
University of Sussex, Brighton, England, UK
Thursday, May 14, 2020
The coronavirus pandemic has created enormous volatility in global financial markets but prices of safe-haven assets such as gold and bitcoin are not surging as one might expect, thanks to intense and large-scale manipulation, according to analysis by the University of Sussex Business School.
The contrast with the last major global financial catastrophe is telling.
Following the Lehman Brothers collapse in September 2008, the correlations between the S&P 500 index and gold, or the Swiss Franc, or U.S. Treasuries were all around minus 40%. During March and April 2020 the correlation between the S&P 500 index and gold was plus 20%.
... Dispatch continues below ...
USAGold: Coins and bullion since 1973
USAGold, well known for its Internet site, USAGold.com, offers contemporary bullion coins and bullion-related historic gold coins for delivery to private investors in the United States, Europe, Canada, Australia, and New Zealand. It is one of the oldest and most respected names in the gold industry, with thousands of clients and an approach to investment that emphasizes guidance and individual needs over high-pressure sales tactics. The firm's zero-complaint record at the Better Business Bureau makes it an ideal match for the conservative, long-term investor looking for a reliable contact in the gold business.
Please call 1-800-869-5115x100 and ask for the trading desk, or visit:
USAGold: Great prices, quick delivery -- all the time.
Even more surprising is the behaviour of the bitcoin/U.S. dollar rate. Since this cryptocurrency emerged in January 2009 its behaviour was completely uncorrelated with any traditional asset, but as the S&P 500 index plummeted in early March 2020, so did bitcoin. Their correlation was plus 63% then and it remains unsettlingly high at 40%.
The biggest beneficiaries of these market attacks, beyond those placing the trades, are holders of U.S. dollars and U.S. assets. These become the main sources of positive returns for global investors in attempts to curtail the recent trend of some central banks to diversify their reserves away from the U.S. dollar.
The CryptoMarketRisk team at the University of Sussex Business School has been tracking trades on these markets in recent months and have detailed huge sell orders on gold futures, massive pump and dump on copper futures, and large spoofing orders on key crypto exchanges.
Some single trades on Comex have been so large as to move prices -- clear contraventions of U.S. laws on market abuse. But widespread market turmoil means regulators such as the U.S. Commodity Futures Trading Commission have a lot on their plates right now, meaning that even large-scale manipulation of these markets remains below the radar of regulators.
Carol Alexander, professor of finance at the University of Sussex Business School, said: "As funds flow out of equities one would expect demand for gold and bitcoin to increase. But this time around safe havens have behaved completely differently. Gold and bitcoin have fallen at the same time as U.S. equities.
"As the S&P 500 crashed in March 2020, gold had its worst week in eight years when it should have been its best, because of massive shorts on Comex gold futures. Bitcoin has also been driven down by some pretty obvious manipulation bots on the unregulated crypto derivatives exchanges, especially BitMEX.
"We are witnessing financial market manipulations on a scale and frequency that have rarely been seen before. The lack of integrity by a few powerful market players is causing a major financial market meltdown from which the current form of our global economy may never recover."
Professor Alexander's new book, "Corruption and Fraud in Financial Markets," went on sale this week:
Toast to a free gold market
with great GATA-label wine
Wine carrying the label of the Gold Anti-Trust Action Committee, cases of which were awarded to three lucky donors in GATA's recent fundraising campaign, are now available for purchase by the case from Fay J Winery LLC in Texarkana, Texas. Each case has 12 bottles and the cost is $240, which includes shipping via Federal Express.
Here's what the bottles look like:
Buyers can compose their case by choosing as many as four varietals from the list here:
GATA will receive a commission on each case of GATA-label wine sold. So if you like wine and buy it anyway, why not buy it in a way that supports our work to achieve free and transparent markets in the monetary metals?
To order a case of GATA-label wine, please e-mail Fay J Winery at firstname.lastname@example.org.
* * *
Support GATA by purchasing
Stuart Englert's "Rigged"
"Rigged" is a concise explanation of government's currency market rigging policy and extensively credits GATA's work exposing it. Ten percent of sales proceeds are contributed to GATA. Buy a copy for $14.99 through Amazon --
-- or for an additional $3 and a penny buy an autographed copy from Englert himself by contacting him at email@example.com.
* * *
Help keep GATA going:
GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:
To contribute to GATA, please visit: