Lately various media outlets have been swamped with stories and allegations of precious metal manipulation ranging from the arcane, to the bizarre to the outright ridiculous. At issue is not that these claims of price fraud are unfounded - they very well may be completely true - but without a notarized facsimile of an actual trade ticket signed by Brian Sack, or his replacement Simon Potter, or any of the BIS traders confirming they are indeed selling gold on behalf of the Fed, BOE, ECB, SNB or BOJ simply to keep the price of the metal down, what such constant factless accusations (and no, sorry, a chart showing that the price of gold may go up or go down sharply indicates merely that and nothing about the underlying factors for such a move) do is to habituate the broader public to the real issues surrounding precious metal, and other asset class, manipulation. So instead of searching for circumstantial evidence which one can easily find everywhere, we decided to go straight to the source. To do that we go back to a post we wrote back in September of 2009, based on an internal previously confidential Fed document, which conveniently enough explains everything vis-a-vis gold manipulation and leaves nothing to speculation or misinterpretation. Zero Hedge presents the smoking gun that may provide responses to all the various open questions regarding the Fed's Modus Operandi in the gold arena which answer the core question - motive - courtesy of a declassified memorandum, written by none other than the then Fed Chairman, and addressed to the president of the United States.
From Zero Hedge, September 27, 2009.
Exclusive Smoking Gun: The Fed On Gold Manipulation
Zero Hedge has recently presented several declassified documents from the pre-1971 "Nixon Shock" days, that endorse the case for gold as a major historical factor in US monetary and foreign policy, as demonstrated by State Department and CIA disclosure. Gold's special status in policy and administrative decision-making was a direct factor in Nixon's choice to abolish the gold reserve at a time of an exploding budget deficit.
Yet what about the days after 1971, and specifically, how did that critical "behind the scenes" organization, the Federal Reserve, perceive and manipulate gold in the post Bretton-Woods world? Was gold, freed from its shackles to the dollar, once again merely a symbolic representation for money?
Zero Hedge presents the smoking gun that may provide responses to all the various open questions, courtesy of a declassified memorandum, written by none other than the then Fed Chairman, addressed to the president of the United States.
On June 3, 1975, Fed Chairman Arthur Burns, sent a "Memorandum For The President" to Gerald Ford, which among others CC:ed Secretary of State Henry Kissinger and future Fed Chairman Alan Greenspan, discussing gold, and specifically its fair value, a topic whose prominence, despite former president Nixon's actions, had only managed to grow in the four short years since the abandonment of the gold standard in 1971. In a nutshell Burns' entire argument revolves around the equivalency of gold and money, and furthermore points out that if the Fed does not control this core relationship, it would "easily frustrate our efforts to control world liquidity" but also "dangerously prejudge the shape of the future monetary system." Furthermore, the memo goes on to highlight the extensive level of gold price manipulation by central banks even after the gold standard has been formally abolished. The problem with accounting for gold at fair market value: the risk of massive liquidity creation, which in those long-gone days of 1975 "could result in the addition of up to $150 billion to the nominal value of countries' reserves." One only wonders what would happen today if gold was allowed to attain its fair price status. And the threat, according to Burns: "liquidity creation of such extraordinary magnitude would seriously endanger, perhaps even frustrate, out efforts and those of other prudent nations to get inflation under reasonable control." Aside from the gratuitous observation that even 34 years ago it was painfully obvious how "massive" liquidity could and would result in runaway inflation and the Fed actually cared about this potential danger, what highlights the hypocrisy of the Fed is that when it comes to drowning the world in excess pieces of paper, only the United States should have the right to do so.
Another notable observation is that despite a muted antagonism between the Fed and the US Treasury persisting for decades, the fuse is and always has been short, and the conflict can promptly hit a crescendo, with the Fed ultimately always getting the upper hand. In the case of the Burns memo, the Fed's position was diametrically opposed to what the Treasury proposed was the proper approach. The result: full on assault by the Federal Reserve over the Treasury's credibility and even then, more than three decades ago, a veiled threat by the Fed involving escalating problems if the recommendation of the Treasury was picked over that of the Fed. "Severe criticism on the part of prominent and influential financiers would inevitably follow if the Treasury's present position prevailed." It is not surprising that the Fed's modus operandi has not changed one bit since 1975: it is our way or virtually assured destruction/embarrassment way.
Additionally, a curious tangent of the Burns memo is the fact that gold was explicitly used as an engine to enact political doctrine: "If the United States took a stand on the gold question that failed to satisfy the French in current international negotiations, would there be adverse economic or political consequences? I doubt it... If we do ever accede to French views on gold, we should at least use our bargaining leverage to achieve some major political advantage." And while gold as a policy mechanism was unable to satisfy its role this time, one wonders on how many subsequent occasions was global democracy trampled over in order to placate the US Federal Reserve:
"I have consulted Henry Kissinger as to whether there is some political quid pro quo we might want to extract from the French in exchange for acceding to some part or all of their desired position on gold. But Henry tells me there is none at this time."
At some point governments of advanced nations will say "enough" to the covert domination of their controlling bodies by the Federal Reserve, which through manipulation of its gold and money interests, effectively has control over not just the French, but every government which has a monetary basis to its respective economy and a relationship to the US "reserve" currency... Which means virtually every country in the world. The backlash, if and when it occurs, will be memorable.
Lastly, the memo presents a useful snapshot into the cloak-and-dagger, and highly nebulous world of Central Bank negotiations and gold price manipulation:
"I have a secret understanding in writing with the Bundesbank that Germany will not buy gold, either from the market or from another government, at a price above the official price."
So to all conspiracy theorists claiming that gold is being manipulated on a daily basis by the Federal Reserve: when it occurs over and over, and is so well documented, it is no longer a theory, it is merely sad. And the fact that the US government goes to great lengths to hide the illicit dealings of the Federal Reserve, which through its monetary tentacles, has prima facie control over not just US policy but also over sovereign governments, is an unprecedented failure in the checks and balances system that the founding fathers had planned when they created the United States of America. Yet saddest is that the United States no longer pursues strategic goals that are in the best interest of the majority of its citizens, but merely manipulates other, less powerful nations into a servile existence that only provides gain to a very limited subset of the American financial oligarchy. It is time for the Fed's unprecedented control over affairs, both global and domestic, to end.
Ben Bernanke Admits Biggest Scam In World History - Public Debt
At the semi-annual Monetary Policy Report hearing in Congress, Chairman of The Federal Reserve Ben Bernanke has tried to explain why a Ponzi scheme is a perfectly acceptable system for United States. Receiving a lesson about currencies and the national public debt, Ben has admitted that public debt is not indispensable and that there are other options available instead of debt-based monetary system. How did Bernanke come to this revolutionary conclusion? Talking about the period when United States had zero federal debt, Senator Mark Kirk reminded him on debt-free national currency.
Gold is the money of kings, silver is the money of gentlemen, barter is the money of peasants, but debt is the money of slaves.
Crom Alternative Exchange Association seeks creative professionals in various fields, producers of paper and metallic money, and it also opens contests for official song of alternative exchange system and design of new banknotes and coins.
Current tragic world’s financial situation is a consequence of economic theory mistake or a consequence of crimes against humanity? Useful information about the monetary reform and social transformation topic, presented to organizers of upcoming International Sustainability Summit by Crom Alternative Exchange Association.
Behind the Web site, Wikipedia stories are being manipulated for cash and written and edited by insiders without a clue while outside experts are ignored.
By Steven J. Vaughan-Nichols, 25 September 2012
Do a Web search on any popular product, event, company, person, whatever. What's the first site that shows up? Chances are it's Wikipedia. For better or for worse, people assume that anything they find in Wikipedia is Gospel truth. That's very foolish. It now seems that some of Wikipedia's writers and editors have sold out the truth for their own gains.
As reported by Violet Blue, two Wikipedia insiders, Roger Bamkin and Max Klein, have allegedly written, edited, and placed Wikipedia articles for paying clients.
The facts appear damning. Klein's consulting businessuntrikiwiki comes right out and states: “A positive Wikipedia article is invaluable SEO: it's almost guaranteed to be a top three Google hit. Surprisingly this benefit of writing for Wikipedia is underutilized, but relates exactly the lack of true expertise in the field. ... WE HAVE THE EXPERTISE NEEDED to navigate the complex maze surrounding 'conflict of interest' editing on Wikipedia. With more than eight years of experience, over 10,000 edits, and countless community connections we offer holistic Wikipedia services.”
Oh yeah, that sure sounds like a Wikipedia editor and not a shill. Since the scandal broke, Klein has tried to spin his business, “We’ve never made a single edit for which we had a conflict of interest on Wikipedia – ever. Although we have advertised such a service, we’ve not aggressively pursued it – and we have not accepted any clients interested in on-Wikipedia work.” So, Klein advertises a service in ALL CAPS in true spammish fashion, but he's never done it? Interesting.
He went on, “We believe – strongly – that there’s nothing inherently wrong with accepting for-profit engagements that involve contributing to Wikipedia, as long as it’s approached in a transparent and ethical fashion.” Jimmy Wales, Wikipedia's founder would appear to disagree: Wales wrote in 2009 that “It is not ok with me that anyone ever set up a service selling their services as a Wikipedia editor, administrator, bureaucrat, etc. I will personally block any cases that I am shown.”
Bamkin has since resigned as a Wikimedia UK trustee . Klein is still listed as a Wikpedian in Residencefor OCLC Research. The Wikipedia internal conflict over whether their actions should be condemned or whether the accusations are unfair attacks from outsiders continues in the site's discussions forums. The mere fact that many Wikipedia insiders are unable to see the problems speaks volumes.
For years, Wikipedia has danced around scandals about its reliability and transparency. The worst example of this, before this current scandal, was when a major Wikipedia site administrator and employee called Essjay, who claimed to be “a tenured professor of religion at a private university” with “a Ph. D. in theology and a degree in canon law,” was proven to be a high-school dropout. Wales first defended him but then distanced himself.
Aside from the scandals, Wikipedia's unique combination of self-righteousness and know-it-allism has long led it to deny experts from outside its closed circle from writing and editing stories. The most egregious recent example was when Wikipedia's editors wouldn't correct an entry about a novel by famous American author Philip Roth when the writer himself reported the error.
In a New Yorker article Roth explained, that he had asked for a serious misstatement about his novel “The Human Stain.” be removed. I'll let Mr. Roth explain what happened next:
Yet when, through an official interlocutor, I recently petitioned Wikipedia to delete this misstatement, along with two others, my interlocutor was told by the “English Wikipedia Administrator”—in a letter dated August 25th and addressed to my interlocutor—that I, Roth, was not a credible source: “I understand your point that the author is the greatest authority on their own work,” writes the Wikipedia Administrator—“but we require secondary sources.”
So there you have Wikipedia in all its glory: Touched with corruption, employing fakes, and so sure of its own correctness that it won't listen to the real experts. Have fun faking up your reports from Wikipedia articles kids!