Tag Archives: gold fix

Anti-Gold Terrorism Goes Unabated: The “New” Gold Fix Is Already Corrupt

LONDON–JPMorgan Chase & Co. (JPM) has become the seventh direct participant in the twice-daily auctions to set the LBMA Gold Price benchmark, according to the price administrator, Intercontinental Exchange Inc.   LINK

The more things “change,” the worse they become.   After Deutsche Bank dropped out of the old LBMA gold fix, the remaining “price fix” banks were:   HSBC, Barclays, Bank Nova Scotia (Scotia-Mocatta) and Soc Gen.

With JP Morgan now announced as the seventh direct participant, here’s the list of participants:   HSBC, Barclays, Bank Nova Scotia, Soc Gen, UBS, Goldman and JPM.

Can someone explain to me how this is supposed to be an improvement over the old fix? Does anyone trust any of these banks?  All seven of them would have – and should have – collapsed in 2008.   The world would be a better place if that had been allowed to happen.

All of them (except somehow maybe Goldman) have been prosecuted and fined for manipulating interest rate and foreign exchange markets.  Is anyone really stupid enough to believe that these banks will conduct the business of fixing the gold price in London in a fair and honest manner.

The fact that the new system is now electronic does not “fix” anything.  In fact, as we have seen ad nauseum with anything and everything connected to the cyberworld (think:  HFT trading) it’s easier to rig something electronically than manually.

I have heard conflicting accounts about reasons China does not have a seat on the new gold price fix committee.  The most credible is that China did not seek to have bank representation.  Instead, China is going to roll out its own yuan-based gold fix mechanism sometime later this year.

Myself and all of my colleagues who have been researching, studying, trading and investing in the precious metals sector since at least 2001 (GATA founded in 1998) all agree that the last three years have seen, by far, the most aggressive, egregious and blatant effort by the Fed/U.S. Government – in conjunction with the EU Central Banks – to manipulate the precious metals market in order to support the massive money printing schemes being used to finance Government spending, keep the banks from collapsing and finance illegal wars.

The “New” LBMA Gold Fix Is Just As Rigged As The Old One

As my undergrad English major advisor used to say:  “This is old wine in a new bottle.”   Meaning, you can dress up a pig but underneath the fancy clothes it’s still a pig.  The “new” London gold fix will enable the big bullion banks to continue rigging the paper gold market and looting investor money.  They are now emboldened to do it in broad daylight and without masks.

This applies wholeheartedly to the “new” LBMA fix.  Given that the reporting of the GOFO rates has been eliminated and the “new” price data has fancy lipstick but is even less informative than the LBMA’s old data reporting, the “new” London gold price fix is at least – if not more – corrupted than the old fix.

As I expected, the “new” LBMA gold fix will even more opaque  than the previous process, despite the appearance of more transparency.  Four banks have already been named:  Scotia, HSBC, SocGen and Barclays.   Seen those names before?  Here’s a brief update:  LINK.

Scotia is one of the most corrupt bullion banks and one of the primary paper manipulators of gold and silver on the Comex.  If you keep your bullion at Scotia, get it out.  If you read thru custodial documents available from funds who “safekeep” metal at Scotia, you see that there’s a good chance your gold and silver bars have been hypothecated.

HSBC – not much needs to be said there.  HSBC has been one of the most frequently prosecuted and fined banks for market manipulation in areas other than precious metals.  Sure, HSBC rigs the trading and its books in every other business line it operates but not precious metals…Of course, there is the issue of HSBC closing its NYC “retail” vaults in 2009 and its London “retail” vaults this year…

SocGen and Barclays – both primary LBMA bullion banks who participate openly in market rigging and gold leasing.

We don’t know who the last two banks will be, but up to this point the Intercontinental Exchange (ICE) – which will administer and manage the “new” gold fix process – has indicated that a Chinese bank will not be involved.

The likely candidates to fill the remaining two spots include JP Morgan and Citibank.  I don’t think anything more needs to be said about this matter.   The crooks who control the paper gold trading markets in London and NYC have been enabled to continue their illegal trading activities and looting of investor money.

Ronan Manly of Bullionstar has written an excellent description of the “new” gold fix:   London Gold Fixing.