JP Morgan & HSBC Are The Tip of the Iceberg In Precious Metals Price Suppression
Financial journalist Lars Schall has published a series of reports in which he presents his experiences attempting to get institutions like the Central Bank of Russia, Bundesbank and the NY Fed to address gold and silver price suppression. What’s been officially allowed to leak to the public is that banks like JP Morgan and HSBC, first and foremost, are suppressing gold and silver prices. This policy, as Schall’s work demonstrates, is a coordinated effort among nearly all international and central banks, not just a couple private banks.
Even people who subscribe to the notion that western nations are united by a single program – termed the “New World Order” (although, in this humble peasants’ opinion, the “New World Order” is really just a high-tech Old World Order - have their doubts about the role nations like Russia and China play in the global order. It is certainly a question that is marred by contradictory information, but reports such as Schall’s latest, in which he to no avail attempts to get comment from Russia’s central bank, is eye-opening.
Russia’s silence on the matter, whether or not it is due to avoidance of confrontation with the west or otherwise, is complicity in the suppression. But, the Russian state apparently believes it is not completely informed on the issue, as its own spies within the United States have been caught fishing for information related to gold prices. In 2010, a 37-page report related to the arrest of ten Russian spies living in New York and cozying up with financiers and insiders was published by the Justice Department. Gold is mentioned as follows:
On a number of other occasions, the SVR specifically indicated that information collected and conveyed by the New Jersey Conspirators was especially valuable. Thus, for example, during the summer and fall of 2009, Cynthia Murphy, the defendant, using contacts she had met in New York, conveyed a number of reports to Center about prospects for the global gold market.
It can be assumed that the heart of the global gold and silver suppression rests in international banks and transnational corporations, and that, although they are necessary to the maintenance of power by TNCs, national governments are peripheral players without the benefits of full insider information. The capstone participants in the gold and silver suppression are transnational banks headed by demise-of-the-state globalists. This might seem like hyperbole thought up by an armchair conspiracy theorist, but I borrow these terms from within academia, who sometimes acknowledges the international force to consolidate power through globalism. It is here important to make note that Russia’s central bank does indeed sit on the board of the Bank for International Settlements, the “central bank of central banks.” This fact exposes Russia’s deep allegiances.
Here are some excerpts from the reports by Lars Schall. First up, Russia:
Officials of the Central Bank of Russia declined to comment on specific questions related to Russia’s gold policy. With that refusal, the Bank of Russia forms a queue with the Deutsche Bundesbank, the U.S. Federal Reserve, the New York Fed and the Bank of England, which I contacted in the past.
The following message was sent to Moscow to two senior officials of the Bank of Russia in English and Russian:
Dear Mr. Mozhaiskov, Dear Mr. Uljukajew,
If your time allows it, I would like to ask you a few important questions and hope you will answer them. The answers could be given in Russian or English. Afterwards they would be published at the websites of Matterhorn Asset MGMT and GATA.
1) What does the Bank of Russia think about the gold market and do you believe it is manipulated by Western central banks? Mr. Mozhaiskov’s speech to the LBMA (Bullion Market Forum, Baltschug Kempinsky Hotel, Moscow, June 3-4, 2004 / http://www.gata.org/node/4235) certainly implied as much.
2) It is rumored in the Western countries, that no gold that is mined in Russia reaches the world market, but is bought by the Bank of Russia. Is this interpretation correct?
3) What is the goal of the Bank of Russia related to a backing of the ruble by precious metals? Is there a minimum percentage rate at which the ruble should be gold-backed? Would also a bi-metal standard work? Is this in general a policy to veer away from the US dollar?
4) Were there ever gold sales from the gold stock of the Russian central bank?
5) What does the Bank of Russia think about the fact that some key Western central banks, e.g. the Deutsche Bundesbank, do not really control their gold stocks insofar they are located at the New York Fed (compare: http://www.gata.org/node/10550)? How trustworthy is a euro that does not only lack a gold backing, but is also very unlikely ever backed by gold due to the fact that the gold of some Eurozone members isn’t available for them?
6) Do you think that crude oil and other natural resources will be paid in the future with hard assets such as gold?
Thank you very much!
After a few difficulties afterwards with the fax that was sent to Moscow, our Russian translator, Kirill Galetski, informed the Management of Matterhorn, Chris Powell of GATA and me today about the following:
it turns out that our request did eventually land on somebody’s desk, because a bank official just called me on my mobile to inform us that Mozhaiskov and Ulukyayev have both refused to comment on any of our questions and other bank officials will also not comment on these matters as per bank policy.
I’m sorry we didn’t get more of a result, but that’s the long and the short of it.
On April 3 I wrote the following inquiry to the Press Office of Deutsche Bundesbank, Germany’s central bank.
“Dear Ladies and Gentlemen:
“My name is Lars Schall. I am a freelance journalist for finance. May I ask you to help in a matter in which the Bank of England, the U.S. Treasury, the U.S. Exchange Stabilization Fund, the Board of Governors of the Federal Reserve, and the New York Federal Reserve were not cooperative in any way?
“See ‘Germany Should End the Secrecy and Bring Its Gold Home,’ Monday, October 10, 2011:
“The contact with the press office of the New York Fed was especially unsatisfying (January 3, 2012):
“The questions I have for you are:
“– Does the Bundesbank have swap arrangements with any of those mentioned parties related to the German gold reserve overseas?
“– Regarding the swap arrangement between the ESF and the Bundesbank that was mentioned during the Federal Open Market Committee meeting in January 1995 (see Page 125 at
http://www.federalreserve.gov/monetarypolicy/files/FOMC19950201meeting.p…), is this strictly a swap arrangement related to foreign currency / exchange?
“Yesterday, April 2, I published an interview headlined “Peter Schiff — There Will be a Lot of Pain”:
“I’ve asked Mr. Schiff:
“Roughly 66 percent of the German gold reserves are located at the New York Fed. If you would be the head of the German central bank, the Deutsche Bundesbank, would you repatriate this gold?
“Schiff replied: ‘I would not hold my gold in the United States. I would be afraid that the U.S. might decide to seize it for an emergency. So if I was Germany, I would ask for all of my gold to be returned from the Fed, and I would buy as much gold as I could in the open market.’
“Q: Why should Germany buy more gold in the open market?
“Schiff: Just to have more gold. Germany should get rid of its dollar reserves and other currency reserves. That would be a much better way to go.”
“Moreover in the past I’ve asked James G. Rickards, author of the recent book ‘Currency Wars’:
“‘A huge chunk of the foreign gold reserves located at the New York Fed belongs to Germany. What are your thoughts related to the German gold reserve in custody at the New York Fed? Let’s assume you were the head of the Deutsche Bundesbank with the best interests of the German people in mind, and assuming that we’re heading to a system of currencies backed by gold. What would you do in that respect?’
“Rickards: It depends on the German gold policy. If Germany wants to leave monetary policy to the United States and is willing to accept whatever policy plans the U.S. comes up with, Germany should probably leave the gold where it is. That is a question of confidence. But if Germany wants to pursue its own policies or perhaps have a more gold-backed euro or maybe even go back to a deutsche mark, then they should bring the gold to Germany and store it in secure vaults under control of the Bundesbank. For as long as it stays in the United States, the gold is vulnerable to confiscation. So you really don’t have the control over your own monetary policy as long as your gold is in other hands. During the Cold War, given the Russian threat, I am sure it made sense to have the German gold in New York. But today I would be concerned more with the Federal Reserve’s printing presses than with Russian tanks, and thus I would like to have the gold in Frankfurt.
“And consider this exchange between the financial journalist Nomi Prins and me:
“‘Officially, Germany has the second largest gold reserve in the world. Roughly 66 percent of the gold is located in the vaults of the New York Fed. Do you think that Germany should relocate its gold reserve from New York to Frankfurt just to be on the safe side?’
“Prins: I wouldn’t keep 66 per cent of my gold at the Fed. [Laughs.] Yes. If I was Germany, and taking note of what is going on in the global economy, in the U.S. economy, and how the Fed is artificially propping things up, I would want to pull out my gold assets. I would want tangible physical assets in my possession. I don’t see why the German central bank wouldn’t want to do that. It just doesn’t make sense to me.
“Can you comment on this, please, since it’s of your concern?
“I’m copying this inquiry to Chris Powell at GATA, James G. Rickards, and Max Keiser. Could you send your answer — if there is one — to them as well, please?
“Thank you very much.
Part 1 of the exercise:
On March 16, 2011 I wrote to the Press Secretary of the Federal Reserve in Washington DC, Michelle A. Smith (firstname.lastname@example.org), and the Press Office of the NY Fed (email@example.com) the following request:
Dear Ms. Smith, dear Ladies and Gentlemen!
My name is Lars Schall and I am a freelance journalist for finance from Germany. I would like to ask you some questions with regards to the German gold reserve at the NY Fed and a specific question of which I assume that also the Federal Reserve Board of Governors in Washington DC is a part of. Since I work related to that topic together with Chris Powell from the Gold Anti-Trust Action Committee, GATA, the U.S. journalist Max Keiser, and the Senior Managing Director for Market Intelligence at Omnis, Inc., James G. Rickards, could you send your response to those email-addresses as well, please:
Here’s the background: At the end of last year, I wrote a request to the German Bundesbank (that received the number 2010/020273).
I have the following questions for you:
1) Does the Bundesbank has gold swap arrangements with the United States / Federal Reserve respectively does the U.S. / Federal Reserve has gold swap arrangements with the Bundesbank?
2) Given the response of the Bundesbank cited above, Chris Powell made the comment: “The Bundesbank refuses to say whether it has engaged in gold swaps and why. It’s as good as a confirmation.” Could you comment on this as far as your entity is concerned?
3) Do you have an idea what “strategic nature of the activity” means respectively what it means when the Bundesbank wrote to GATA consultant Rob Kirby: Germany keeps much of its gold at “gold trading centers” abroad “in order to conduct its gold activities” (see: http://www.gata.org/node/7713)? What are you in that case at the NY Fed exactly doing with the German gold?
4) In the past the Bundesbank stated with regards to the German gold reserve abroad “that transportation to Germany and safekeeping in the Bundesbank’s own vaults would entail high costs.” Can you give me an estimation of the costs of safekeeping the German gold in the vaults of the NY Fed, please? (I would like to figure out why it costs less to keep it safe in the U.S. / NYC than in Frankfurt and/or Mainz.)
5) According to Dimitri Speck’s German written book “Die Geheime Goldpolitik” (published at the Finanzbuch Verlag in Munich, 2010 – see: http://www.gata.org/node/9349), the amount of the part of the German gold reserve (total 3.446 tonnes) that is located in the United States / NY Fed is 66%. Can you confirm that?
6) In case the Bundesbank would order the German gold reserve that is located in the United States to Frankfurt: would there be any insurmountable problems involved from your side?
I am optimistic that some clear answers related to the questions above could put long lasting rumors and irritations to rest. By the way: together with Dimitri Speck and Professor James K. Galbraith I’ve put some rumors and irritations with regard to the German gold reserve / Federal Reserve recently indeed to rest:
Thank you very much for your attention!
I received then a few hours later from the NY Fed this message:
“Thank you for contacting the New York Fed. We will respond to your e-mail as soon as possible. For more information, please visit our website at http://www.newyorkfed.org./.“
On May 2, seven weeks later, I wrote about “The Sound of Silence” that the NY Fed and the Board of Governors of the Federal Reserve System sent me afterwards – see:
Part 2 of the exercise:
On October 10, 2011 I published an essay at the website of GATA about a request that I did forward to the Bank of England and the the U.S. Treasury – see here:
My email to the U.S. Treasury said:
Request re Exchange Stabilization Fund.
Dear Ladies and Gentlemen and dear Ms. Alaimo,
My name is Lars Schall and I am a freelance journalist for finance from Germany. I have three simple questions for you related to a rather mysterious topic:
Swap arrangements between the Exchange Stabilization Fund and the Deutsche Bundesbank, respectively the national German gold reserves that are placed in the United States of America.
Due to the fact that in the past:
a) the Deutsche Bundesbank, the Federal Reserve Bank of New York, and the Federal Reserve System’s Board of Governors in Washington treated my public requests in that regard not very well; and:
b) since the Exchange Stabilization Fund is the entity that is involved with gold market operations on behalf of the U.S. Treasury (and to a lesser extent on behalf of the Federal Reserve), I would like to ask you now for some clarifications, please:
1) Regarding the swap arrangement that was acknowledged / mentioned during the Federal Open Market Committee meeting in January 1995 (see FOMC19950201meeting.pdf / Page 125) between the ESF and the Deutsche Bundesbank, is this strictly a swap arrangement related to foreign currency / exchange?
2) Do you have any swap arrangements with the Deutsche Bundesbank related to the German gold reserves that are located in the United States?
3) For what reason do you need a swap arrangement with the Deutsche Bundesbank related to its gold in the U.S. — or with any other foreign central bank / foreign gold reserves — if you actually have one or would seek to get one? (See the minutes of the FOMC meeting in January 1995 FOMC19950201meeting.pdf / Page 69, the remarks by Mr. Mattingly.)
Thank you for your attention!
The response that I have received? Zero.
What Lars Schall has amassed is a fascinating record of silence by premiere global financial institutions on gold and silver suppression. This is not a surprise to anybody familiar with the true ruling architecture of the planet. Although so much focus is put on banks like JP Morgan and HSBC, the reality is that these banks are merely the tip of the iceberg. Every single bank on the planet which depends on fiat hegemony must be viewed as complicit in the scheme to undermine the prices and psychology behind the precious metals’ markets. These metals, with emphasis on gold and silver, are the only viable alternative currently as a global medium of exchange (gold for large transactions, silver for small transactions, assuming that the current precious metals’ price mechanism is anywhere reflective of these metals true value, which it very well could not be). The public must understand that gold and silver have been money for thousands of years before they can begin to understand that other forms of money which are not managed in a command-and-control capacity – fiat or not – can also be used to facilitate local, national and global trade.
Vielen Dank Herr Schall!
Photo Credit: TF Metals Report