The Federal Reserve’s “invisible hand” in the markets is no longer “invisible.” It’s become obvious to most market participants that the Fed is working hard to keep the stock market from collapsing and the price of gold below $1300. But why?
The price of gold moved up $15 overnight from the time the Asian markets opened until the Comex gold pit opened. Shortly after the Comex paper gold market trading was underway, an avalanche of paper contracts was dumped onto the Comex – both the electronic trading system and the floor. This is what it looked like (click to enlarge):
Gold’s path looks like Niagra Falls in the graph above because shortly after the Comex opened this morning because “someone” decided to dump over 55,000 contracts onto the Comex. 55k contracts translates into 5.5 million ounce of theoretical gold.
“Theoretical” because it’s only in theory that the Comex has 5.5 million ounces of gold to deliver. Currently the Comex is reporting a little over 697k ounces that are available to be delivered into the paper gold contracts that the banks print up and dump on the market. The Comex vaults are showing a little over 7 million ounces in total in the vaults. This is highly theoretical because most of the gold is accounted for the big bullion banks. I use “accounted for” loosely because there is no mechanism in place to hold the banks accountable for what they are reporting.
In other words, the amount of “physical” gold reported by the Comex is likely nothing more than a “suggestion.”
In the graph to the left (click to enlarge) there’s been a definitive trading pattern that doesn’t take Einstein’s eyes and brain to see. For the last three trading days, gold has moved higher prior to the opening of the Comex floor in NYC only to be price-smashed with a deluge of paper contracts representing little more that theoretical gold.
But I prefer the real thing. I actually welcome these price hits because it enables me to move theoretical electronic currency from my bank account into a bona fide gold currency in a BITGOLD account. When gold moves higher, my net worth will be the beneficiary of the Fed’s market interventions. I look at it as grabbing my share of the 
wealth being transferred by the Fed/Government from the besotted middle class to those who know what’s going on.
Of course, the more interesting question begs to know the real reasons the Fed is compelled to make its market intervention activities so blatant. One look at the economic reports being released from non-Government sources and the condition of the U.S. Government’s balance sheet readily answers that question…
Hi Dave,
So, you have tested BitGold and found it to be a trustable institution (in a world of fraud) ?
It’s really a question. I am thinking of doing the same.
Yes. I operates OUTSIDE of the Central Bank system. I use the Mastercard debit card all the time. It’s a great service.
Yeah, but try and take delivery of the gold (from BitGold) – not just 10 grams – a sizeable chunk – say 10 oz. Go on, just try.
I already know several people who have done that. What’s your point? You need to have enough money to take delivery of a kilogram bar. That’s 35.3 ounces. Or they have these 10gram cubes which are refined per these specs:
Our BitGold Corporate By-Laws require that we must buy or sell assayed and stamped .9995 pure (99.95%) or better bullion-grade gold for the benefit of customers from an approved list of refiners and assayers whose gold meet the minimum specification set by the London Bullion Market Association (LBMA) or New York Mercantile Exchange division Commodity Exchange, Inc. (COMEX).
I have taken a sizable delivery. No problem. I also traded some of my bitgold for silver eagles at my local coin shop.
What makes you think there would be difficulty in doing so?
https://www.bitgold.com/blog/what-is-bitgold/
The FED is definitely worried. I was laughing my butt of when I saw the attack today. Another few billions to save another day and make the collapse worse. I hope all these bastards will burn in hell.
Disclaimer: I just opened my bitgold account over the weekend. Pretty nifty system. I was up, funded, and on my way in about 30 minutes. I’m waiting on the debit card. You can even pick which country to store your gold. Excellent so far. Gold Money has been around for 15 years. From all accounts they have a very reputable gold vaulting service. They merged with Bitgold in 2015. What a great match.
Now for the fear part. Peter Schiff dismantles the go to market strategy of Bitgold in one of his webcasts. Basically stating that the company consumes its stock revenues to offer a lower cost gold storage service. He also slams Bitgold’s claim of first and only gold banking service. (Schiff has a competitive offering) He also dislikes the storage of gold cubes, preferring sovereign coins or bars. I suspect the gold cubes are recast and refined from scrap. I’m okay with that, since its probably the closest anyone can get to melt price.
I’m going to Dollar cost fund this account as a way to diversify my holdings outside the U.S. I think its a grand idea that is well executed. I believe Bitgold has a great go to market strategy. At this point I’ll trust but verify the Bitgold offering. I don’t think there is an easier way to diversify outside the U.S., stay in Gold, and maintain liquidity at the same time.
Schiff is being catty
Our BitGold Corporate By-Laws require that we must buy or sell assayed and stamped .9995 pure (99.95%) or better bullion-grade gold for the benefit of customers from an approved list of refiners and assayers whose gold meet the minimum specification set by the London Bullion Market Association (LBMA) or New York Mercantile Exchange division Commodity Exchange, Inc. (COMEX).
This is just so fucking Soviet, it makes Lenin look like an honest man. On the last hit a few days ago I turned my fiat currency into a few more kilo ingots of silver. All else is monetary masturbation, the stock market now is like going to a strip club stoked on Viagra but wearing an iron Chastity belt, nothing more than a mess will come of it.
Its not just gold, all the markets are manipulated at different times. Yen/dollar seems to be a big one. We don’t know who is swimming naked until the tide goes out, and there’s probably a lot.
Hi Dave
I agree with Douglas, not trusting Bitgold to have correct bullion inventory. Same goes for Peter Schiff and for Max Keiser’s digital gold offerings. Similar to the ETF’s, and mining shares, any diversion from holding physical bullion in personal possession leaves us vulnerable in an era of sanctioned fraud.
It sure looks like the banking cartel footprints are becoming more and more blatant. But I missed the point regarding US gov balance sheet being the reason. If the cartel wanted to be more discrete surely the would be. I say the banking cartel are being deliberately painted as villains, shortly to take the fall for it. Meanwhile the globalists have made off with our gold at discounted prices, and will get away clean with a 20+ year gold heist. By my reasoning, the Shanghai Gold Exchange is nothing more than a glorified gold laundering operation.
There is an element of social Darwinism working into the smashing the silver price i think..people 2 years ago I could never have convinced silver was a good buy have started buying every dip and are now giving me the good oil lol, so the more people that get the opportunity to acquire metal, the better in the reboot IMO on bitgold I don’t know enough, but I think when it get’s to a point where franchises’ or the structured business model allows expansive access it seems like a brilliant Idea…how ever if they start claiming they can pay interest I would start to be very wary….great article as always
Dave, I have been with BitGold for over a year and have taken delivery of the cubes sealed and labeled..But I would like your comment and thoughts on their new board member..Biddle from GOLDMAN SACHS…I do not like this..what are your thoughts or concerns
Director
Leslie D. Biddle is the President and Partner of Serengeti Asset Management, a New York-based value-investment firm. Previously, Ms. Biddle was a Partner at Goldman Sachs and the Global Head of Commodity Sales, and also held roles as CFO of the firm’s investments in the metals and mining sector, head of Power, Metals/Industrial, Latin American and Environmental Commodities. She was responsible for many of the structured transactions in the private equity and power spaces.
Ms. Biddle was a member of Goldman Sachs’ Finance Committee, Business Practices Committee, Firm wide New Activity Committee, Structured Investment Products Committee and European Audit and Compliance Committee.
Prior to joining Goldman Sachs, Ms. Biddle was a Vice President at The AES Corporation focusing on project finance and power plant development. She also served as a vice president at the Overseas Investment Corporation, providing political risk insurance and financing to U.S. companies expanding overseas.
She holds an A.B. from Colby College where she is a member of the Board of Trustees.
Biddle is a new board member of BitGold? Probably not a big deal. If anything it validates BitGold. The Soros’ family is a 10% owner of Bitgold. THAT on the surface is very troubling. However, I think Bitgold is potentially the model or platform that can be used as the “backbone” of gold-backed currency system. Think about how flexible Bitgold is. Layer in silver to the model and we’re ready for gold/silver-backed electronic currency system!
Dave — you mention (twice) ” *our* BitGold Corporate By-Laws require that we must buy or sell assayed and stamped .9995 pure (99.95%) or better….”
Is that a cut-n-paste from BitGold bi-laws or are you personally involved with the company?
Cut n paste – have no interest in the company other than I plan on presenting the stock idea when I get a chance to Mining Stock Journal subscribers.
Silver storage costs (at least @ today’s manipulated silver prices) is a totally different equation compared to gold storage cost, and James Turk stated in the past that he wasn’t interested in thinking about it.
But on a slightly more disturbing note, last week I watched a video of James Turk and Roy Sebag together, in which they proceeded to state:
“Only gold qualifies for the definition of money, and has for thousands of years. Silver does not meet the criterion. Only gold is money. Silver cannot be money, as much as GOLD IS MONEY.”
Goes without saying, it’s highly disturbing. The undisputably declared: “Silver Guru” or “Mr. Silver” David Morgan had the following to respond:
“A claim that silver is not money is one of THE MOST ridiculous claims. Silver has served as money for mankind for thousands of years, in bigger capacity than even gold ever has. The very word used to describe the word ‘money’ in hundreds of languages and cultures across the world literally means ‘silver’ in those languages. Only a lunatic or a person with ulterior motive could claim that silver is not money.”
#SilverIsMoney
James Turk is a fantastic, higly respectable person of integrity with some of the deepest knowledge of monetary history and finances. Why would he make such a ridiculous statement at this point about silver is quite frankly beyond me. (Hate to jump to an unrelated topic, but in some ways it’s similar to the unfortunate “bizzare digressions” of a highly respectable person like Paul Craig Roberts saying favorable sounding statements about Vladimir Lenin, Che Guevara etc.)
I know your buddy Rory Hall had met James Turk in recent past. Possibly he also featured on one of your past interview videos?! I can’t recall. But if either or both of you run into James Turk again, it would be nice if he could be directly asked about how he could he possibly make such a statement about silver? This is exactly the sort of attitude which William Jennings Bryan had warned about, with his reservations for a “hard gold standard” with disregard for silver, and the famous “Mankind shall not be crucified on a cross of gold” speech.
As far as the company BitGold itself? Notwithstanding the strange attacks on silver, from a technology and monetary perspective it seems like a fantastic idea. Hopefully a great start that will help more people escape clutches of Fiat Cancer. Would I trust storing my life’s savings, especially things like pensions, IRA, 401K etc. with it? NOT a chance. But I’ve personally put enough emergency that could serve a family for emergency lasting 3 to 6 months. I’m happy so far with how it serves the purpose. I’ll continue putting little bits and pieces more into it for any upcoming dips to achieve dollar cost averaging. But I would never ever think about putting significant life altering amounts there, in case they have some future frauds.
Yes would love to see silver added in.
How can anyone know if bitgold is just another fractional reserve banking fraud or not? That is, X number of claims on gold for Y ounces of gold in storage. Should I just trust them?
All I can tell you is that I have taken several deliveries of gold from my Bitgold account. It was not expensive to take delivery. I exchanged some for silver with two local coin dealers, so I’m confident in the gold content of the cubes.
Whether Bitgold turns into a fractional reserve scam (like the COMEX or LBMA), I guess no one can say for sure. It is not a bank, so it is not governed by the banking laws which allow fractional reserve lending.
Nothing is ever completely secure from theft and or fraud. But it is hard to conduct transactions in the world without having “trust” in something you can exchange. Faith in the dollar is waning. What currency would you consider safe? They can all be depreciated and inflation can compromise their value. Eventually fiat currencies all revert to their intrinsic value. Zero. Lots of precedence for that.
I look at it this way. If I were to dive on an ancient treasure ship and discover a hoard of gold and silver, the PMs would have value today, no matter how old. If I were able to retrieve any ancient paper currency, it would be worthless other than possibly some collector’s value if there wasn’t too much of it around.
Governments may try to confiscate. There is some precedence for that. And there was a theft in Dubai of gold from a supposedly secure vault not that long ago, and many customers were ripped off. Bill Holter and others say that if the gold is not in your immediate possession, it is not yours.
If on the other hand if Bitgold can achieve its goal of becoming a new form of gold backed currency, similar to Bitcoin, but backed by gold; then it will certainly be a very convenient way of buying/selling/trading and exchanging gold for currency and or for spending via the debit card. Gold backed currencies are not fiat, so no faith is required to understand their value. But you have to trust your dealer.
Keeping some PMs in your immediate possession is a prudent idea. But I also want to have the flexibility to easily trade and spend for the prevailing currency. As Jim Sinclair says, “gold is for savings, currency is for transactions.”