- In the last Midas, I reported to you that several sources
told me that the Federal Reserve was "jawboning" futures commission
merchants not to pressure firms to "deliver gold." In other words,
they know that the gold is not there for the shorts to deliver and, as
I have long suspected, it appears that they are protecting the positions
of certain bullion dealers and of other financial institutions that are
short gold. This corroborative information is clear evidence that the gold
market has been manipulated as the Gold Anti-Trust Action Committee has
- Two days ago, I received information that a futures commission
was told by another futures commission merchant that it was prepared not
to deliver gold on its " gold forward or futures contract" obligations
that was expected by a client of the firm who was standing for delivery.
In essence, the shorts were declaring "force majeure" - WE CANNOT
- This is not a Comex problem as far as I know. From what
I am hearing, it is an OTC problem, where few people really know what is
really going on behind the scenes. The firm that expected delivery was
stunned. It was about to be "floored." According to our sources,
this firm then got a phone call from the Federal Reserve requesting that
they do not pressure the shorts into making delivery and that they would
make sure that the longs received their gold. I am not privy as to exactly
how that would happen.
- According to another source, there were actually a couple
of firms that told the longs that they were not prepared to deliver "forward"
contract gold in the size expected. Goldman Sachs is one of the firms mentioned
to me that is not prepared to fulfil its obligations. That is what my sources
in the market place are telling me.
- It should be of no surprise to any of you that Counterparty
Risk Management Group Co-Chair's, Goldman Sachs and J.P. Morgan were all
over London CNBC this morning talking down the gold market. Sources tell
me that Goldman suggested on the tube that the big gold shorts covered
on the run up while Morgan's Kevin Crisp was calling for $275 to $280 gold
when this blip was sorted out. Whose risk are they both concerned about?
- Strange. Today, Goldman Sachs and Chase banks were big
buyers of gold options on Comex. Why buy options if you are not bullish
or you believe the gold market has topped out for the time being. Yes,
the buying can be for clients. Are their clients not listening to them?
On that note, for maybe the first time in Comex history, the gold option
volatility is higher than that for the silver contract.
- There are other Goldman Sachs stories out there, but
I want more confirmation of them before I present them to you.
- Last night, I received a phone from a "very plugged
in hedge fund manager" who confirmed to me that George Soros is long
"forward" gold. NOT COMEX GOLD. That is not a rumor anymore;
that is a fact, according to my source. Soros is also long aluminum and
silver according to that same source.
- This source also tells me that George Soros most likely
does Comex business with Refco as do many of the big hedge funds. I do
not know about who he does his OTC business with or who he trades with
in London. However, according to this hedge fund manager, one should start
at Refco as a starting place in tying this altogether.
- This extraordinary development is an affront to all that
believe in free markets.
- There has been an orchestration by some bullion dealers
and some of our own "officialdom" to hold down the gold price
so that their own selfish interests can be served. In the meantime, gold
miners are out of work, gold companies are going bankrupt, gold stock shareholders
have been decimated, etc.
- This is an outrage of the highest order and it has been
going on for some time.