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Paper-Gold Fraud Now Out In The Open

Articles & Blogs - Gold Commentary

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How do you “stretch” an ounce of gold? Obviously if you want an answer to that question you ask the bankers.

Bankers have earned their generalized contempt in our societies, going back literally thousands of years. Formerly known as the “money-changers”, their Original Sin is well-known to anyone who has studied the history of these professional thieves.

As money-changers, they would graciously offer to “hold” peoples’ (heavy, bulky) gold for them; and exchange that for their convenient, light-as-a-feather “gold certificates.” Always the banksters would end up issuing far more certificates for gold than they actually had the gold to cover – and “fractional-reserve banking” was invented.

Eventually the insatiable greed of the banker would result in him issuing such an enormous surplus of “gold certificates” versus the actual gold he held that this money-dilution would be noticed by the general population. The bankers’ gold-scam would then quickly collapse and vast numbers of ordinary people would be wiped out (and so “capital punishment” was invented).

Thus ask a bankster how to stretch an ounce of gold, and (for thousands of years) his answer would be automatic: sell “paper gold.” Flash-forward two thousand years or so, and we see the banksters looking to fall back on their oldest crime to attempt to wallpaper over some of their newer ones.

We have a huge gold deficit (and silver deficit, as well) in the world today. New, incremental demand for gold grossly exceeds annual incremental mine-supply. This has become a permanent deficit, which by itself is absolute proof of market-manipulation.

The virtues of (actual) “free markets” are well-known to anyone familiar with basic market dynamics: they self-correct. If supply exceeds demand, the price falls to a sufficient level to discourage more supply and encourage more demand – until those simultaneous dynamics achieve equilibrium: supply and demand matching, with prices stable.

Conversely, where demand exceeds supply; prices must rise sufficiently so that more supply is encouraged and more demand is discouraged, until once again equilibrium is achieved. Thus a permanent supply-deficit is ipso facto proof of price-suppression.

The problem with the price-suppression of any kind of physical “good” is always the same, one inevitably runs out of inventory as the repressed supply and excessive demand caused by artificially low prices means that buyers will always outnumber sellers.

In the case of the banksters’ perennial gold-suppression scheme; their supply-deficit dilemma has caused them to recently focus on one target: the population of India. As the world’s most consistently voracious consumers of gold, permanently under-pricing gold has caused a predictable effect. There is a large “gold deficit” in India, as India must import vast quantities of gold each year to satisfy the excessive demand for gold caused by selling it at give-away prices.

As is generally the case, the Corporate Media has totally perverted its own explanation of this scenario. India’s large gold-deficit is being called a “current account deficit” – i.e. a paper deficit. This is absurd on multiple levels.

 

One aspect I already addressed in a recent commentary. Gold is money. It is defined and treated as “money” in every meaningful way by the bankers themselves. As a matter of the simplest logic, it is impossible to create a “current account deficit” by swapping one form of money for another.

On another level this media lie is even more perverse. Regular readers understand the basic equation of our 21st century financial system: fiat currency = worthless paper. So we have the Western propaganda machine attempting to convince us (and India’s government) that India is currently experiencing a “currency crisis” because large quantities of the bankers’ worthless paper is leaving the country, and large quantities of valuable gold is entering the country.

Understand that if the United States had encountered a similar “problem” 40 years ago that the world would have never abandoned the gold standard. Back then, the U.S. had a real “currency crisis”: its national Treasury was being cleaned-out of all its gold. At the (suppressed) price of that time period, all of the world’s nations wanted to dump their U.S. dollars and exchange them for gold.

History is unequivocal. A “currency crisis” is when a nation is losing its gold, and getting nothing in return but the bankers’ “magic beans.” The actual crisis here is for the Western banking cabal, not the nation of India. It is their gold-suppression Ponzi-scheme which is teetering on the verge of collapse.

It is their multi-billion dollar, ultra-leveraged short positions which are threatened with being blown out of the water should gold ever be allowed to rise to its fair market value (versus the banksters’ debauched fiat-currencies). And so we see the Western Corporate Media offering us “solutions” for what it continues to hilariously characterize as India’s problem.

Only a week ago, some Western “front” group suggested gold-confiscation in India as a banker trial-balloon. However, as I pointed out in that same, previous commentary; proposing to loot the gold from India’s religious temples was not a promising avenue for the banker crime syndicate to pursue.

So, today, we see the bankers falling back on their 2,000 year-old solution for dealing with a gold deficit: start issuing “paper gold.” The absurdity here is that this is nothing less than an implicit confession of fraud on the part of many/most of the floggers of “paper gold.”

When a media article suggests that India’s gold-deficit can be fixed by “selling paper gold” (to the Chumps), there is literally only one possible way this could ever happen: by selling paper but calling it “gold.”

One has to wonder if this article is causing anyone to squirm at HSBC – Britain’s largest bank – and the world’s largest holder of paper gold (by an enormous margin). Informed readers know that not only does HSBC act as “custodian” for the world’s largest paper-gold fund (the SPDR Gold Trust), but it also permanently holds the largest gold short-position in the history of markets.

Fortuitously (for HSBC) it has never been required by our pseudo-regulators to actually demonstrate it has enough gold to cover more than one of these two massive gold-obligations. Et voila! One ounce of gold becomes two ounces of “paper gold.”

Of course as we all know thanks to Jeffrey (“100:1”) Christian, the banksters’ leveraging of their paper gold (overall) exceeds a paltry 2:1 level by many multiples. Indeed, some of the banksters have been known to sell “paper gold” and not back it with any gold at all – just ask some of the (former) disgruntled clients of Morgan Stanley.

Yes, no doubt about it! Selling “paper gold” would certainly address the gold-deficit problem in India…for Western bankers. Unfortunately, it’s a scheme which will almost certainly not work out nearly as well for any Indian Chumps who purchase the bankers’ paper gold.

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Jeff Nielson
...
written by Jeff Nielson, December 24, 2012
...Rampant corruption in the society at every level has taught Indians not to trust anyone, literally, and thus they will always be concerned about their gold. They know full well that if the paper gold scheme is to implode the government cannot do much, in the west at least the sheep trust the regulators still, in India, only the rich and the connected trust the regulators to do their bidding, the people already consider them as useless in protecting their interest.


Lol Samix!

Thanks for pointing out the one "silver lining" in living in an openly/overtly corrupt society: inherent suspicion/skepticism on the part of the general population.

However, (as you point out) we have the WORST of both worlds in the West: just as much corruption, but because most of the Sheep are still oblivious to it they continue to place their trust in their governments and even the Oligarchs themselves. smilies/sad.gif
samix
...
written by samix, December 24, 2012
There is one difference though in the paper gold investors in India and the west, in India, most people who will invest in paper gold would be sophisticated investors, in the sense that they will know full well that they are in the game to capture the gold price and not for the delivery. When it comes to physical gold, these people will have a separate stash.

Most Indians as far as I think would not mistake paper for gold, because the majority of Indians buy gold in the form of jewellery and not bullion, and you cannot wear paper for a wedding or the innumerable festivals that the majority of Indians celebrate almost every month.

Rampant corruption in the society at every level has taught Indians not to trust anyone, literally, and thus they will always be concerned about their gold. They know full well that if the paper gold scheme is to implode the government cannot do much, in the west at least the sheep trust the regulators still, in India, only the rich and the connected trust the regulators to do their bidding, the people already consider them as useless in protecting their interest.

As an example, do you know that in India people do not rent their homes to a person for more than 11 months because the renter is not trusted to not "take over" the house and call it his own. The people do not trust the government or the regulators to help them get their homes back.
Jeff Nielson
...
written by Jeff Nielson, December 19, 2012
I had to laugh when I saw the notice that billions had been invested in Indian gold ETFs; more suckers for gold that will never be distributed. The proof would be in the prospecti as to whom will be allowed to take delivery (c.f. GLD). But the ultimate epiphany will come from China when they claim at least 4000 tons and they propose to Western nations "we'll show you ours, if you show us yours".


Yes, Apberusdisvet, the Catch-22 here is that you can TELL people to "read the prospectus" (with GLD and the other dubious "funds"), as I've done in the past. But the PROBLEM is that the only people actually prudent enough to listen are the people who ALREADY read the prospectus -- and would never touch "paper gold."
apberusdisvet
...
written by apberusdisvet, December 19, 2012
Jeff: I had to laugh when I saw the notice that billions had been invested in Indian gold ETFs; more suckers for gold that will never be distributed. The proof would be in the prospecti as to whom will be allowed to take delivery (c.f. GLD). But the ultimate epiphany will come from China when they claim at least 4000 tons and they propose to Western nations "we'll show you ours, if you show us yours".

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