July 2, 2012 By Joseph P. Farrell

Ok...I admit it: I'm something of a "gold bug" in that I've been following all these weird stories on this website about the discrepancies in the stated amount of the world's gold (thank you, Lord Blackheath), the even weirder stories about all those fake gold-backed bearer bonds and currency counterfeiting, and more recently, the moves of various nations to repatriate their gold reserves from the vaults of the  Federal Reserve to their own countries. Beginning with Hugo Chavez of Venezuela, the movement quickly spread to India, and, of course, to Germany, which supposedly has over three thousand metric tons of gold reserves.

Now we can add yet another bizarre "fact" into this growing mountain of bizarre "facts", reported by independent German journalist Lars Schall (and please bear in mind folks, I am in no position to "vet" Mr. Schall or nor any agendas that may be afoot behind the political scenes in Germany, but nonetheless, think it significant enough to pass along for you to make up your own minds about):

Exclusive: Fed Memorandum related to Gold Price Suppression in French and German

The actual PDF of the memorandum can be found here:

Fed Chairman Arthur Burns to President Gerald Ford

While there were many statements in this memorandum that caught my attention, there were two in particular that stood out. Number one:

"Fourth, a large measure of freedom for governments to trade in gold at a market-related price may easily frustrate efforts to control world liquidity."

And number two:

"...some other European countries(most importantly, the Germans and the British), are unlikely to participate with the French in a European, go-it-alone policy on gold. I have a secret understanding in writing with the Bundesbank -- concurred in by Mr. Schmidt -- that Germany will not buy gold, either from the market or from another government, above the official price of $42.22 per ounce. Second, there is in my judgement a reasonably good chance of a 'successful' negotiation in Paris next week, even if it proves impossible to win French acceptance of individual country gold ceilings and other aspects of the U.S. position on gold issues."

Now, connect the dots here: (1) the Fed was opposed to market driven gold trade as this would "frustrate efforts to control world liquidity," and as part of those efforts, the U.S. wanted to tell everyone else how much gold they could actually hold, and the British and the Germans were apparently at that time, in support of this policy as the opposing policy would have favored a (3) European go-it-alone policy.

In the light of what has recently happened in Europe, with German insistence on other nations collateralizing their gold reserves (and now, their national treasures) as backing for Eurobonds, and German calls for repatriation of its gold currently in the Federal Reserve, it would appear that another effort is being made for another "go-it-alone" policy.

Which brings us back to that pesky Lord Blackheath and those pesky bearer bonds stories. Why would the US seek ceilings on individual nations' gold holdings? Well, one speculative answer is that the actual amounts of gold might be far below, or, pace Lord Blackheath, far above officially estimated amounts. Without controlling the ceilings, it would be impossible to "cook the books" so to speak, and for that matter, to issue all sorts of bearer bonds on gold reserves plundered from Europe and Asia during World War Two...  Why, not having ceilings might expose a whole hidden tier of finance - and very possibly the purposes for which it was established - and we wouldn't want that, would we? And apparently a German Chancellor (and we may therefore assume, his predecessors and successors in office), were parts to a secret deal... one wonders: how far back does that secret deal go?  Well, I suspect many of you have already guessed my suspicions...

See you on the flip side.