ktlight
20th August 2011, 16:51
FYI:
Here comes Hugo Chavez demanding the return of 211 tons of Venezuelan gold from the criminal bankers of London and New York. Max Keiser said today that the Bank of England does not have the Venezuelan gold and will be forced to go into the markets and buy it at increasingly higher prices.
Hugo Chavez has sent the gold market into backwardation. That means that the price of physical bullion delivered today is worth more than a paper promise of a delivery at some future date. That has driven the gold market higher since yesterday. $1,900 and $2,000 gold are in sight.
There is a difference between paper and physical gold. The US and UK governments lease their gold out to banks. They are not supposed to deliver the bullion. For example, they deliver a piece of paper saying you owe the government one million ounces of gold. This is mistakenly treated as an asset. Stock analysts report a bank in New York just bought a million ounces of gold. Then that bank sells that same paper gold five times. The proceeds of those five sales generate cash from the sales which also adds to revenues. But the original bank still shows the paper gold as an asset on its books. Then banks like HSBC and JP Morgan open ETFs (Exchange Traded Funds) GLD and SLV. People deposit real money into these ETFs thinking they own gold and silver. These funds have a mixture of bullion and lots of paper derivatives. (A derivative is a bet on the future value of a bond or a commodity like gold or oil.)
To make the dollar look good the Federal Reserve creates hundreds of billions of dollars which it gives to the banks to sell short the paper price of gold and silver. Note the US Plunge Protection team through the Treasury has a conference call every morning to 27 brokers and banks. The The Treasury and the FED ask these groups to manipulate all the markets with all losses to be picked up by the Federal Reserve printing more money. That is why I do tell the average investor to stay out of the futures markets.
A few weeks ago the run up in silver was stopped temporarily by 5 raises in margin requirements and by a bank selling short one third of the world’s entire silver production for the whole year in just one minute in the futures market with a potential loss of ten billion dollars. The banks do not care if they lose ten billion dollars a minute because it is your money and not theirs they are playing with.
Enter Jeff Christian and Alan Greenspan. Jeff Christian is infamous for saying there is and should be 50 to a 100 dollars of paper gold and silver for every dollar of bullion. Alan Greenspan’s is now most famous for saying that the US will never default on its debt because we can print lots and lots of money.
Investors all over the world now clearly understand the banks are playing musical chairs with tens of trillions of dollars in currencies and bonds and more than a quadrillion dollars in derivatives and Credit Default Swaps. A CDS is a hybrid between a derivative and insurance. It insures the values of your financial bets. A few US banks have insured the world for 6oo trillion dollars in potential losses. In theory you are supposed to pay of a few hundred trillion dollars in banker gambling losses by being willing to accept a 100% tax rate for a century or two.
This game of musical chairs will end very badly and very soon with 90% of all savings and 99% of all paper gold and silver and 100% of all CDS going to zero value.
source to read more
http://vidrebel.wordpress.com/2011/08/19/hugo-chavez-gold-runs-bank-runs-and-bank-holidays/
Here comes Hugo Chavez demanding the return of 211 tons of Venezuelan gold from the criminal bankers of London and New York. Max Keiser said today that the Bank of England does not have the Venezuelan gold and will be forced to go into the markets and buy it at increasingly higher prices.
Hugo Chavez has sent the gold market into backwardation. That means that the price of physical bullion delivered today is worth more than a paper promise of a delivery at some future date. That has driven the gold market higher since yesterday. $1,900 and $2,000 gold are in sight.
There is a difference between paper and physical gold. The US and UK governments lease their gold out to banks. They are not supposed to deliver the bullion. For example, they deliver a piece of paper saying you owe the government one million ounces of gold. This is mistakenly treated as an asset. Stock analysts report a bank in New York just bought a million ounces of gold. Then that bank sells that same paper gold five times. The proceeds of those five sales generate cash from the sales which also adds to revenues. But the original bank still shows the paper gold as an asset on its books. Then banks like HSBC and JP Morgan open ETFs (Exchange Traded Funds) GLD and SLV. People deposit real money into these ETFs thinking they own gold and silver. These funds have a mixture of bullion and lots of paper derivatives. (A derivative is a bet on the future value of a bond or a commodity like gold or oil.)
To make the dollar look good the Federal Reserve creates hundreds of billions of dollars which it gives to the banks to sell short the paper price of gold and silver. Note the US Plunge Protection team through the Treasury has a conference call every morning to 27 brokers and banks. The The Treasury and the FED ask these groups to manipulate all the markets with all losses to be picked up by the Federal Reserve printing more money. That is why I do tell the average investor to stay out of the futures markets.
A few weeks ago the run up in silver was stopped temporarily by 5 raises in margin requirements and by a bank selling short one third of the world’s entire silver production for the whole year in just one minute in the futures market with a potential loss of ten billion dollars. The banks do not care if they lose ten billion dollars a minute because it is your money and not theirs they are playing with.
Enter Jeff Christian and Alan Greenspan. Jeff Christian is infamous for saying there is and should be 50 to a 100 dollars of paper gold and silver for every dollar of bullion. Alan Greenspan’s is now most famous for saying that the US will never default on its debt because we can print lots and lots of money.
Investors all over the world now clearly understand the banks are playing musical chairs with tens of trillions of dollars in currencies and bonds and more than a quadrillion dollars in derivatives and Credit Default Swaps. A CDS is a hybrid between a derivative and insurance. It insures the values of your financial bets. A few US banks have insured the world for 6oo trillion dollars in potential losses. In theory you are supposed to pay of a few hundred trillion dollars in banker gambling losses by being willing to accept a 100% tax rate for a century or two.
This game of musical chairs will end very badly and very soon with 90% of all savings and 99% of all paper gold and silver and 100% of all CDS going to zero value.
source to read more
http://vidrebel.wordpress.com/2011/08/19/hugo-chavez-gold-runs-bank-runs-and-bank-holidays/