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Question for Dan Norcini et al.: Are central banks rigging gold or not?

By: Chris Powell, Secretary/Treasurer, GATA

 -- Published: Tuesday, 3 May 2016 | Print  | Disqus 

Dear Friend of GATA and Gold:

Replying to your secretary/treasurer's speculation last night that central banks lately may have moved from gold price suppression to allowing gold to rise to help devalue currencies and debt -–

-- market analyst Dan Norcini asserts that GATA has come over to his position:

Not at all.

In the first place, Norcini had just written that rather than helping central banks avert deflation, a dramatically rising gold price would actually signify the end of the world:

That is, Norcini wrote: "I still cannot stomach so many of these gold cult members who seem not to understand that when they are cheering predictions of $5,000, $50,000, etc., gold prices, they are cheering the ruin of everything around them."

Your secretary/treasurer's speculation had explicitly contradicted Norcini's assertion. So there's no agreement there.

Now Norcini writes: "I had been saying for some time that the Fed was not behind weakness in the gold price ever since the dollar embarked on its bull run back in 2014."

Huh -- 2014? But GATA began complaining of gold market manipulation and suppression 15 years earlier, and Norcini goes on to concede that during much of that time he subscribed to GATA's views.

So do GATA and Norcini disagree only as to exactly when in the last few years central banks generally or the Federal Reserve particularly may have discontinued gold price suppression?

Once again, not really.

In the first place, your secretary/treasurer's commentary last night was admittedly only speculation. GATA doesn't know that Federal Reserve policy has changed from gold price suppression to dollar devaluation. Indeed, that speculation arose in large part from suspicion that central banks may not have lost control of the gold market and that, if gold is rising again, it is only because that is what central banks now want it to do and how they are guiding the market with their surreptitious trading.

That the Fed to this day remains up to its neck in gold market manipulation was confirmed at the central bank's highest levels just a few weeks ago when the president of the Federal Reserve Bank of New York, William Dudley, taking questions at a public forum in Virginia, clumsily refused to answer one about whether the Fed is involved in gold swaps. Then his press spokesman refused even to acknowledge GATA's follow-up question on the subject:

Anyone who doubts that U.S. government policy toward gold prior to 2014 was a policy of suppression is implored to dispute, specifically, document by document, the official records compiled here --

-- and here:

Norcini has not done that, though of course no one else who disparages GATA has done so either. In the absence of such dispute, it may be assumed that the records are genuine and that they are fairly construed as GATA has construed them.

Just as GATA doesn't care much about price predictions for gold, positive or negative, it doesn't care much about the "technical analysis" offered by Norcini and other gold market commentators, "technical analysis" of rigged markets being mere hallucination.

Rather, GATA cares mainly about free markets and limited, transparent, and accountable government, and so agreement or disagreement with GATA rests on the answers to these questions:

-- Are central banks involved in the gold market surreptitiously or not?

-- If central banks are involved in the gold market surreptitiously, is it just for fun -- for example, to see which central bank's trading desk can make the most money by cheating the most investors -- or is it for policy purposes?

-- If central banks are surreptitiously in the gold market for policy purposes, are these the traditional purposes of defeating a potentially competitive world reserve currency? Or have these purposes lately expanded to include purposes like devaluing currencies and debt to avert a catastrophic worldwide debt deflation, the emergency policy anticipated in 2006 by the Scottish economist Peter Millar, whose study of gold revaluation often has been publicized by GATA?:

-- If central banks, creators of infinite money, are surreptitiously trading a market, how can it be considered a market at all, and how can any country or the world ever enjoy a market economy again?

Just as Norcini has not challenged GATA's documentation of gold market rigging, he also seems not to have addressed those questions. But then no other critic of GATA has addressed them either. For as Chesterton wrote a hundred years ago, "As is common in most modern discussions, the unmentionable thing is the pivot of the whole discussion."

If central banks are surreptitiously trading markets, Norcini's "technical analysis" is the least of the casualties. In that case markets and even democracy itself are finished.

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:

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

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

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:

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