Wednesday, October 14, 2009

An Amazing Gold Related Chart

Since the beginning of this decade, staying in general US stocks/equities has been a loosing proposition.

The Dow Index priced in gold:

Can you imagine what some US real estate index priced in gold must look like? Yikes!!!!


Wait till this build up in central bank reserves (debt) make it out into the economy:

This graph is from Hugo Salinas Price's article entitled:

A new Magna Carta for our times

A little more history to go with the above graph:


Not good at all. More skull drudgery may be coming to the surface.

Central Banking: A Blight On Humanity

by Rob Kirby | October 9, 2009

Impeccably reliable sources have informed me that as recently as Sept. 30, 2009 – the last possible day of trade in the Sept. 09 gold futures – a number of well-heeled market participants “bought” substantial tonnage worth of gold futures on the London Bullion Market [LBMA] and immediately told their counterparties they wanted to take instantaneous delivery of the underlying physical bullion.

The unexpected immediate demand for substantial tonnage of gold bullion created utter panic in at least two banks who were counterparties to this trade – J.P. Morgan Chase and Deutsche Bank – because they simply did not posses the gold bullion which they had sold short [an illegal act which in trading parlance is referred to as a “naked short”].

Because these banks did not have the bullion to honor their contracted commitments, one or both of them approached the counterparties and asked if there was any way they could settle this embarrassing matter quietly on a “cash basis” to absolve the banks from fulfilling their physical bullion delivery obligations. The purchasers were not interested in a ‘cash settlement’ and demanded delivery of physical bullion giving these banks 5 business days to resolve the situation. A premium of as much as spot plus 25 % [that would be 1,250 – 1,300 per ounce of gold] was offered to settle this matter in fiat money instead of the embarrassment of a very public “failure to deliver” on the part of the London Bullion Market Association.

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