The End of the Paper-Gold Market?

An important subject in precious metals markets which does not draw enough attention from commentators in this sector are the inherently fraudulent paper-called-gold (and paper-called-silver) “products” which the bankers peddle to the foolish. Numerous, previous commentaries have drawn attention to various facets of this fraud.

However, my own reporting on this subject changed dramatically, beginning in the spring of 2013. Astute readers will recall that this marked the beginning of an extraordinary series of events. First the One Bank (and its lackey politicians) introduced the world to its newest form of serial stealing : the “bail-in”.

This had both tremendous direct and indirect relevance to precious metals. Indirectly, big-money investors (often dubbed “the Smart Money”) had now been alerted to the fact that (as stated in the title of a commentary) “no paper [asset] is safe from a bail-in”. Instantly, this elevated both the status of gold and silver as safe-havens, as well as igniting additional demand for these metals.

But there was also a direct effect on the precious metals sector: awareness that the bankers’ paper-called-gold “products” (primarily the notorious bullion-ETF’s) were now themselves potential targets in one of the One Bank’s future, bail-in mega-thefts. This awareness sparked a massive exodus out of these fraudulent bullion-ETF’s, an exodus which nearly turned into a (terminal) stampede.

Such a stampede was only averted through the bankers themselves soaking-up millions of units of their own, bullion-ETF’s – in order to create the illusion of some degree of stability in these funds. They soaked-up so much of their own, fraudulent paper that these permanent mega-shorts actually became “net long” in the gold market at one point.

Even with the bankers buying millions and millions of units of their own bullion-ETF’s, the carnage was unprecedented. The largest (and most-fraudulent) of the gold bullion-ETF’s, the SPDR Gold Trust (more commonly known by its trading symbol “GLD”) saw its holdings collapse from over 1350 tons in the early part of 2013 to less than 800 tons by the beginning of 2014, a total plunge of more than 40%.

This massive liquidation of paper-called-gold (in a world where the “paper gold market” is at least 100 times larger than the real gold market) caused an inevitable plunge in the price of (paper) gold. This sudden drop in price, in turn, triggered the most-dramatic global stampede into real, physical gold ever seen in the world.

At one point, China and India alone were importing gold at an annualized rate of 4,000 tonnes per year, despite the fact that China itself is the world’s largest gold-producer (and little if any of that gold ever leaves the country). Subtracting China’s own production; these two nations alone were importing roughly double the total, annual, global mine-supply.

This unprecedented spike in the buying of real, physical bullion (in markets which the bankers couldn’t corrupt with their paper-called-gold fraud) so terrified the One Bank that it was forced to engage in the heavy-handed blackmail of the government of India. It coerced that government into a near-total embargo on gold imports through a savage attack on India’s currency in global FX markets.

Yet despite torrid global demand for gold throughout most of 2013, there was no recovery at all in demand (and holdings) of the bankers’ fraudulent paper-called-gold. Despite the shills in the Corporate media calling “bottoms” in this market like it was the U.S. housing sector, nothing has been able to entice chumps back into these paper-fraud funds.