IT’S THE GOLD AGAIN FOLKS: PART ONE: A LOOK BACKDecember 8, 2013
Well gold is in the news again folks, or rather, it is always in the news, but since there's only one of me, it gets rather difficult to cover everything all the time. So, a little catching up is in order over the next few days. This article was shared by many of you, and it seems Mr. "Tyler Durden" of Zero Hedge has gone back and done some digging, and found this:
Now, if you scroll all the way to the bottom, you'll find a link to the same article here:
Now let's look closely at a few passages:
U.S. objectives for world monetary system—a durable, stable system, with the SDR [ZH: or USD] as a strong reserve asset at its center — are incompatible with a continued important role for gold as a reserve asset.... It is the U.S. concern that any substantial increase now in the price at which official gold transactions are made would strengthen the position of gold in the system, and cripple the SDR [ZH: or USD].
"In other words: gold can not be allowed to dominated a "durable, stable system", and a rising gold price would cripple the reserve currency du jour: well known by most, but always better to see it admitted in official Top Secret correspondence."
"Mr. Enders: Well, there are several ways. One way is we could say to them that they would accept this kind of arrangement, provided that the gold were channelled out through an international agency—either in the IMF or a special pool—and sold into the market, so there would be gradual increases.
Secretary Kissinger: But the French would never go for this.
Mr. Enders: We can have a counter-proposal. There’s a further proposal—and that is that the IMF begin selling its gold—which is now 7 billion—to the world market, and we should try to negotiate that. That would begin the demonetization of gold.
Secretary Kissinger: Why are we so eager to get gold out of the system?
Mr. Enders: We were eager to get it out of the system—get started—because it’s a typical balancing of either forward or back. If this proposal goes back, it will go back into the centerpiece system.
Secretary Kissinger: But why is it against our interests? I understand the argument that it’s against our interest that the Europeans take a unilateral decision contrary to our policy. Why is it against our interest to have gold in the system?
Mr. Enders: It’s against our interest to have gold in the system because for it to remain there it would result in it being evaluated periodically. Although we have still some substantial gold holdings—about 11 billion—a larger part of the official gold in the world is concentrated in Western Europe. This gives them the dominant position in world reserves and the dominant means of creating reserves. We’ve been trying to get away from that into a system in which we can control—
Mr. Enders: Yes. But in order for them to do it anyway, they would have to be in violation of important articles of the IMF. So this would not be a total departure. (Laughter.) But there would be reluctance on the part of some Europeans to do this. We could also make it less interesting for them by beginning to sell our own gold in the market, and this would put pressure on them."
Et voila! we have at least a part of an answer, a long-term historically rooted answer, to part of what's been going on since President Nixon took the dollar off the gold standard in 1971: Europe was making unilateral moves to pull away from the U.S dollar reserve status, a move apparently initiated by the French, and indeed, a little digging will reveal that this process was being pushed as far back as the government of President Charles de Gaulle. Reading further into the document, the attitude of Henry Kissinger, then the U.S. Secretary of State, is revealing:
"Secretary Kissinger: If they go ahead on their own against our position on something that we consider central to our interests, we’ve got to show them that that they can’t get away with it. Hopefully, we should have the right position. But we just cannot let them get away with these unilateral steps all the time."
In other words, the USA was opposed to sovereign European nations acting like sovereign nations.
So we have a basic premise: in order to prop up the dollar, various US controlled or influenced institutions were to sell bullion reserves to suppress gold prices and buttress the dollar. Given the attitude, would this have possibly involved the the covert, and quite illegal, sale of the bullion reserves of other countries, such as Germany? and is this why the US fed has been "reluctant" to repatriate that country's gold?
Well, by the above premise, repatriating Germany's (or anyone else's gold), would allow such a nation to exercise greater independence. But you cannot repatriate what isn't there... which leads us to make a little prediction. Watch for some nation - possibly from the BRICSA nations - to call for an international audit of the US Federal Reserve system. Of course, it won't happen, but watch for it anyway, because if the Vatican can be audited, why not the Fed, which never has been? To refuse an audit, however, will further weaken the already strained system...
See you.... oh wait, there's one more thing:
POSTSCRIPT: Some of you have been emailing me and asking "Just who is this 'Tyler Durden' anyway?" Well, I cannot say I know, but, I'll share the following information, though I cannot verify if the individual mentioned in the following quotation is the current "Tyler Durden" of Zero Hedge or not:
"Dan Ivandjiiski was traveling in Poland when he received an e-mail... A former trader himself, he'd been railing against high-speed trading for months on his new blog, called Zero Hedge. From his spare apartment on the Upper East Side of Manhattan, he'd been posting under the pseudonym Tyler Durden, the name of the psychopathic character in Chuck Palahiuk's novel Fight Club. Few outside his inner circle knew his true identity, but his savvy, numbers-centric analysis made it obvious to his blog's faithful readers that he'd been a Wall Street insider who couldn't take all the bull**** anymore.
"Durden's primary target - some might even say morbid obsession - was Goldman Sachs. He'd become convinced that the powerful bank was manipulating markets for its own benefit....
"By the summer of2009, Zero Hedge had become a must-read for Wall Street insiders."(Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market, [New York: Crown Business, 2013], p. 251.)
And one more thing, "Durden," like many others, increased his attentions to the issue of High-Speed Trading, or High Frequency Trading, after the May 6, 2010 "Flash Crash."
See you on the flip side.