The “New” LBMA Gold Fix Is Just As Rigged As The Old One – Dave Kranzler

TND Guest Contributor:  Dave Kranzler |

As my undergrad English major advisor used to say:  “This is old wine in a new bottle.”   Meaning, you can dress up a pig but underneath the fancy clothes it’s still a pig.  The “new” London gold fix will enable the big bullion banks to continue rigging the paper gold market and looting investor money.  They are now emboldened to do it in broad daylight and without masks.

This applies wholeheartedly to the “new” LBMA fix.  Given that the reporting of the GOFO rates has been eliminated and the “new” price data has fancy lipstick but is even less informative than the LBMA’s old data reporting, the “new” London gold price fix is at least – if not more – corrupted than the old fix.

As I expected, the “new” LBMA gold fix will even more opaque  than the previous process, despite the appearance of more transparency.  Four banks have already been named:  Scotia, HSBC, SocGen and Barclays.   Seen those names before?  Here’s a brief update:  LINK.

Scotia is one of the most corrupt bullion banks and one of the primary paper manipulators of gold and silver on the Comex.  If you keep your bullion at Scotia, get it out.  If you read thru custodial documents available from funds who “safekeep” metal at Scotia, you see that there’s a good chance your gold and silver bars have been hypothecated.

HSBC – not much needs to be said there.  HSBC has been one of the most frequently prosecuted and fined banks for market manipulation in areas other than precious metals.  Sure, HSBC rigs the trading and its books in every other business line it operates but not precious metals…Of course, there is the issue of HSBC closing its NYC “retail” vaults in 2009 and its London “retail” vaults this year…

SocGen and Barclays – both primary LBMA bullion banks who participate openly in market rigging and gold leasing.

We don’t know who the last two banks will be, but up to this point the Intercontinental Exchange (ICE) – which will administer and manage the “new” gold fix process – has indicated that a Chinese bank will not be involved.

The likely candidates to fill the remaining two spots include JP Morgan and Citibank.  I don’t think anything more needs to be said about this matter.   The crooks who control the paper gold trading markets in London and NYC have been enabled to continue their illegal trading activities and looting of investor money.

Ronan Manly of Bullionstar has written an excellent description of the “new” gold fix:  London Gold Fixing.

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About Dave Kranzler:

 I spent many years working in various analytic jobs and trading on Wall Street. For nine of those years, I traded junk bonds for Bankers Trust. I have an MBA from the University of Chicago, with a concentration in accounting and finance. My goal is to help people understand and analyze what is really going on in our financial system and economy. You can follow my work and contact me via my website Investment Research Dynamics.  Occasionally, I publish on Seeking Alpha too. As a co-founder and principal of Golden Returns Capital, LLC Mr. Kranzler co-manages the Precious Metals Opportunity Fund, a metals and mining stock investment fund.

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