OT or not? Gold Anti-Trust Action

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See the following letter to US Senator Phil Graham from the Gold Anti Trust Association. The Y2K tie in may involve collusion between big money - Goldman Sachs and other banks - with governments to keep the price of gold down so that they can:

a. Rake in big profits prior to a Y2K liquidty squeeze.

b. Prop the stock market up to prevent a drop and prevent real notice of Y2K implications. Many are not taking Y2K seriously because the market is up and gold is down, but if it is being manipulated then if the manipulation stops the reality of the situation could reverse it self with gold up and stocks down.

c. Prop up the long foreign currency derivatives that the big banks took on in last few years, especially last summer's Asian crisis and bailout of Indonesia, Thailand, others and Brazil in S. America.

If you are so inclined, you may want to forward this to your Senators and Congressman/woman. I expect a more printable copy from GATA shortly.

GATA Letter:

The GOLD ANTI-TRUST ACTION COMMITTEE ASKS SENATOR PHIL GRAMM, CHAIRMAN OF THE SENATE BANKING COMMITTEE, TO INVESTIGATE GOLD MARKET MANIPULATION

Dallas, Texas, July 21 -- The Chairman of the Gold Anti-Trust Action Committee, Bill Murphy, announced today that Phil Gramm, Chairman of the Senate Banking Committee has received a letter/document asking that his committee investigate GATA's charges that the gold market is being manipulated.

The letter/document was initiated after communication between Bill Murphy and staff members of the Senate Banking Committee who expressed interest in The Gold Anti-Trust Action Committee's allegations.

The Gold Anti-Trust Action Committee was formed in January of this year to investigate what appeared to be blatant "collusion" by various entities to hold down the price of gold. GATA retained one of the top anti-trust law firms in the U.S., Berger & Montague from Philadelphia, to assist them in their investigation and in their quest to learn the truth about what is really going on behind the scenes in the gold market.

Speaking from his home in Dallas, Texas, Murphy stated that, "GATA's findings were sent to Senator Gramm " in the spirit of proud U.S. citizens that cherish democratic principles. For if our suspicions prove are correct, those democratic principles are being cruelly trampled. The few people and institutions in the know in this scheme are gaining incredible riches at the expense of many. The manipulation of the gold price is destroying mining companies and their employees and shareholders as well as whole countries dependent on gold production".

Murphy went on to say, "We suspect that what we have here is a scandal that is more profound in nature than "Watergate" because so many people are suffering unnecessarily, while, in a bigger picture sense, the manipulation could affect the stability of the banking system. We believe that to suppress the price of gold, the "collusion crowd" has borrowed so much gold from central banks and sold it into the market that it could not be paid back as promised should the price of gold rise quickly and unexpectedly. Last year the gold supply coming out of the mines was 2,529 tonnes while GATA's research reports suggest that the gold loans have risen to 8,000 to 10,000 tonnes.

GATA has been documenting evidence since last Fall about the gold market manipulation, but it was the Bank of England's announcement of its plans to sell gold that sent off alarm bells around the world. No other central bank has announced a gold sale prior to its completion in over 20 years, and the Bank of England's announcement just happened to be made as the gold price was storming past a key gold loan borrowing point and interest in the gold market was finally rising again.

Yet, the night before the BOE announcement ( May 6, 1999 ), GATA feared duplicity and Murphy wrote as such in his www.lemetropolecafe.com commentary: " We got word late this afternoon that their bullion desk is calling their clients saying that the gold market is stopping at $290".

Murphy contends that utterances by some of England's most notable officials are more than raising an eyebrow or two.

In this letter/document to Senator Gramm, Murphy points out that Prime Minister Tony Blair said this about the BOE sale, "" We did this on technical advice from the Bank of England". Yet, on Sunday July 11, The Chancellor of the Exchequer, Gordon Brown, said in the London Times, "The proposal to sell the reserves was put to ministers by officials, and, say treasury insiders, agreed to it with little discussion".

According to another London Times article, the chancellor is also to said to have been surprised and mortified by the reaction from Thabo Mbeki, the South African president, who said last week that the decision would have a "potentially disastrous effect" on South Africa. But the same Gordon Brown, ( just prior to a recent trip to England by an African delegation ) was all over the wire services talking about the righteousness of his gold decision while continuing to extol the virtues of the proposed IMF gold sale. The headline on a wire dispatch read: U.K.'s Brown Sees Wide Support for IMF Gold Sales.

Then there was The Bank of England's Eddie George who when asked in an interview who made the asset allocation decisions on the "bank reserves", he answered, "the government" --that is, the politicians.

GATA contends that the decision to sell England's gold had more to do with protecting the interests of bullion dealers than benefiting the interests of the English citizens and suggests to Senator Gramm it is just one example of what is really going on behind the scenes in the gold market. The evidence is plain as day. Prime Minister Tony Blair said the English gold sale was a Bank of England decision. The Bank of England says it was a Treasury decision. The Treasury says it was only a Treasury decision of sorts and agreed to with little discussion.

"Good grief" Murphy goes on. "A decision that may have disastrous effects on South Africa, a democracy the West is committed to encourage, was made with little discussion and no one will take responsibility for it. Yet, it is such an important decision that Tony Blair will not reconsider it, even though it appears he does not know who made the decision in the first place.

GATA believes it is reasonable to ask whether something is awry in the gold market. We are not making any wild accusations. We are just searching for some answers to valid questions. One of them is why the Clinton administration is so adamant about IMF gold sales when one considers who is opposed to the sale? They include: 1 ) Jim Saxton, Chairman of the Joint Economic Committee, 2) Jesse Helms, Senate Foreign Relations Committee Chairman 3) Tom Daschel, Senate Minority Leader 4) Dick Armey, House Majority Leader 5) Tom Delay, House Majority Whip, 6) and Democratic Senators such as Richard Bryan (D), Tim Johnson (D), Harry Reid (D), who all warned former Treasury Secretary Robert Rubin in a letter that they will oppose the proposal and 7) The Black Caucus, to a person said they would not support the IMF gold sale proposal.

Another compelling question concerns Fed Chairman Alan Greenspan's twice made comments on July 24, 1998 before a House Banking Committee and on July 30, 1998 before a Senate Agricultural Committee that, "central banks stand ready to lease gold in increasing quantities should the price rise". "Many in the gold community would like to know what Mr. Greenspan meant by that", Murphy says.

The Gold Anti-Trust Action Committee joins James Saxton, Vice Chairman of the Joint Economic Committee, in calling for greater market transparency in which "openness and accountability would be mandated". Saxton has prepared legislation, the ESF Transparency and Accountability Act, to reform the Treasury's Exchange Stabilization Fund (ESF).

GATA hopes that its queries reach as many politicians in gold producing countries as possible. To facilitate that effort, they have an e-mail army that will be sending the letter/document to members of the U.S Congress. This "army" is led by Colorado based GATA supporter, Richard "The General" Harmon, who is organizing GATA volunteers from all over the world that are sending this letter/document to politicians in Canada, South Africa, Australia and England.

The letter/document that was sent to Senator Gramm may be obtained by emailing GATA Vice Chairman, John Meyer, at bfameyer@aol.com.

Contact: Bill Murphy, Chairman, Gold Anti-Trust Action Committee - E-mail: lepatron@lemetropolecafe.com. Web site: www.gata.org.

Le Metropole Cafe

All the best,

Bill Murphy Le Patron and GATA Chairman

-- Bill P (porterwn@one.net), July 21, 1999


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