GATA – the ‘Gold Anti-Trust Action Committee’ – started life in late 1998 and has for the past two decades been pounding away at its claim that the gold price is suppressed by collusive practices between central banks and large investment banks. It is a classic case of a group of conspiracy-minded people – who might just be right. GATA’s website – www.gata.org – has amassed a huge amount of evidence from publicly-available archives. Whether all this evidence will persuade you is another matter, but it certainly is detailed.
Chris Powell, a US journalist, a member of the Connecticut Council on Freedom of Information, and secretary of GATA, agreed to speak to me. “I’m not a gold ‘bug’,” he says, “I’m a transparency ‘bug’”. He got into successfully fighting trusts as a journalist. “I started reading complaints from internet site proprietor Bill Murphy, who was writing about the monetary metals markets and who went on to become GATA’s chairman. I said we should form a committee and hire an anti-trust law firm and take action. We didn’t think we would be at it more than 20 years. It took us about two years to discern that all this market manipulation was perfectly legal, because the government was doing it”.
Says Powell: “The Gold Reserve Act of 1934, as amended in the years since then, which established the US Treasury Department’s Exchange Stabilisation Fund, fully authorised the rigging of not only the gold market but to secretly rig any market in the world. Our dreams of suing the big New York investment banks went up in smoke. So, we decided our best bet to stop this was to expose it”.
GATA has turned from its hopes of running an anti-trust legal action to lobbying, to keep the pressure on those it regards as manipulating the gold price: “the direct focus of our work today is government intervention. None of this stuff would be going on if it wasn’t government policy”, says Powell. “It’s about sustaining the Dollar as the world’s global currency and driving gold out of the financial system, and to control interest rates. We have the documents. We have asked, via a US Congress Representative, the CFTC (the Commodity Futures Trading Commission) the question “does the CFTC have jurisdiction over manipulative futures trading undertaken by or at the behest of the US government? The CFTC will not answer this question”.
How does GATA believe such alleged manipulation is carried out? Powell again: “A primary mechanism by which this is done is the Central Bank incentive programme. In this programme the (futures’ exchange) operator offers volume trading discounts in all futures’ markets. It’s a matter of national security. Currency markets are being rigged in favour of the Dollar. The government has to do this trading via the brokers of all the big investment banks. Look at our documents, it’s all laid out, is this a forgery? Make up your own mind”.
Basel 3 – new bank regulatory recommendations from the Bank for International Settlements (BIS) – are due to be globally introduced in 2023. The London Bullion Market Association (LBMA) and the World Gold Council (WGC) have protested to the UK’s Prudential Regulatory Authority that Basel 3 will either kill off or make prohibitively expensive trading in unallocated gold, or paper derivatives. The BIS has no regulatory power – it’s up to the 60 individual member states of the BIS to implement Basel 3 if they choose.
Does Powell think Basel 3 will be implemented? “I think there is one plausible explanation for enforcement of the Basel 3 regulations”, says Powell. “That is, there is a new division among the major central banks. There is now an EU/China/Russia faction that is fighting the US/UK faction. Certainly, they have good reason to resent US Dollar imperialism, and the weaponisation of the Dollar. The Dollar is now the primary mechanism of US imperialism. If they can knock the Dollar down by revaluing gold, I can see that happening”.
According to Powell, “we have been living by the sweat of the brow of the rest of the world for many years. There is incredible bloat in the US, in the economy and society now. We have been enslaving the rest of the world and that corrupts us. I want the US leading the world by example and freedom and democracy and liberty. We have destroyed the free market by this rigging of the currency”.
Powell argues that gold is the competitor of the US Dollar and that the “architecture of the whole system” is designed to protect the Dollar and to keep gold in a subsidiary place. Basel 3, if implemented, could knock asunder the gold derivatives market – around 100 times more ‘gold’ is traded via this system than actually is produced each year.
China has huge ambitions for its Central Bank Digital Currency (CBDC) and hopes for Yuan can become the global reserve currency. China has a lot of gold reserves; might it choose to back its CBDC with gold? “I would be very surprised if any government wanted to directly connect its currency to gold again. Central banks were very glad to get rid of the gold standard because it brought them into the era of infinite money. Gold is a very powerful restraint on government. All government wants to do with gold is put it in its box, put it in the vault, double seal it up and make sure it never comes out”, says Powell. “But I do think that that the anti-US governments and central banks have figured that gold is their only weapon against Dollar imperialism. They know they can use gold against the US Dollar”, says Powell.
Whatever one thinks about GATA – and this piece obviously does not explore its claims in depth – if you are a supporter of gold as money then GATA is an ally in a common cause.
Even if you regard – as influential people in the gold world do – GATA as being rather fanatical, then one must recognise that the organisation is a bastion of gold. Gold shines a light on the depreciating purchasing power of fiat currencies – and, as money is power, and central banks control the money supply, central banks have a vested interest in seeing the gold price under control. Glint, whilst appreciating that the value of gold can also go down, affecting its purchasing power to the negative, believes in the longterm benefits of gold and so, sets out its stall to provide a mechanism to use gold as money – liquid, instant, safe and reliable. Although the two are not aligned in all aspects, Glint and GATA are allies in a common cause. The prominence and success of gold as a real alternative to fiat currencies.