Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com Radio: John Williams and Louis Navellier, and your host Chris Waltzek
By: radio.GoldSeek.com

Technical Scoop - Weekend Update Nov 19
By: David Chapman

Zero Hedge invites Financial Times to heed GATA's urging on gold suppression
By: Chris Powell

The Great Retirement Con
By: Adam Taggart

Perspective on the Gold/Oil Ratio, Macro Fundamentals and a Gold Sector Bottom
By: Gary Tanashian

Global Silver Investment Demand Maybe Down, But Still Double Pre-2008 Market Crash Level
By: Steve St. Angelo

Secular Bull Stock Market?
By: Gary Savage

Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 2% on the Week
By: Chris Mullen, Gold Seeker Report

Ira Epstein's Metals Video 11 17 2017
By: Ira Epstein

Next-Generation Crazy: The Fed Plans For The Coming Recession
By: John Rubino

 
Search

GoldSeek Web

 
LBMA admits London gold market can't be transparent with central banks in it

By: Chris Powell, Secretary/Treasurer, GATA

 -- Published: Monday, 6 April 2015 | Print  | Disqus 

Dear Friend of GATA and Gold:

Central bank involvement may prevent the London gold market from ever becoming really transparent, the chief executive of the London Bullion Market Association has told a Bank of England study group.

The LBMA chief executive, Ruth Crowell, made the assertion in a long statement dated January 30 and sent to the bank's "Fair and Effective Market Review" committee, which is studying regulation of the currency and commodity markets. The LBMA statement was found on the bank's Internet site by gold researcher and GATA consultant Ronan Manly.

While Crowell wrote that the LBMA welcomes more transparency in the London gold market, particularly through "post-trade reporting," she also praised gold lending by central banks for providing "liqudity" to the market, asserting that "it is vital that the role of the liquidity provider is not diminished but in fact strengthened to make sure the markets remain fair and effective."

The Bank of England's review of the gold market, the LBMA statement said, "should prioritize liquidity, as greater liquidity results in markets which are less easily manipulated, and consequently regulators should afford market participants the tools with which to foster liquidity."

But if the foremost providers of "liquidity" are central banks, their provision of "liquidity" is likely the leading mechanism of market manipulation, as central banks have not just access to effectively infinite financial resources but also the powerful motive to manipulate the markets in which their currencies and bonds trade.

Thus the LBMA has made the same bogus and self-serving claim that was made by futures exchange operator CME Group in January in support of the volume trading discounts CME Group gives to central banks for secretly trading the U.S. futures markets it operates -- the claim that secret trading by central banks deters market manipulation rather than constitutes it:

http://www.gata.org/node/14385

http://www.gata.org/node/14818

The LBMA statement acknowledges that "the role of the central banks in the bullion market may preclude 'total' transparency, at least at public level." It adds that "transparency could be increased via post-trade anonymized [emphasis added] statistical analysis of nominal volumes, provided by the clearing banks."

That is, it's OK with the LBMA if its members know what their client central banks are doing in the gold market, but not OK if mere ordinary traders and citizens know.

Thus the LBMA's position is identical to the position of central banks as described in the secret March 1999 report of the International Monetary Fund, which recounted central bank objections to the IMF staff's proposal for greater transparency in the reporting of IMF-member central bank gold reserves.

The IMF staff wanted central banks to distinguish in public reports their gold loans and swaps from the gold reserves held in central bank vaults. The central banks surveyed by the IMF staff responded with horror, complaining that clarity about their gold loans and leases would impair their surreptitious interventions in the gold and currency markets:

http://www.gata.org/node/12016

With Crowell's statement the LBMA has proclaimed itself the enthusiastic agent of surreptitious intervention in the gold market by client central banks. This is something else that mainstream financial news organizations will have to strive to overlook.

The LBMA's statement is posted, at least for the time being, at the Bank of England's Internet site here --

http://www.bankofengland.co.uk/markets/Documents/femr/lbma.pdf

-- and for safety's safe at GATA's Internet site here:

http://gata.org/files/LBMALetterToBankOfEngland-01-30-2015.pdf

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference:

https://jeffersoncompanies.com/landing/2014-av-powell

Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

 


| Digg This Article
 -- Published: Monday, 6 April 2015 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2017



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.