More on PAGE

Market action this week only further demonstrated the need for a new, global pricing mechanism for physical gold and silver. As stated by Ned Naylor-Leyland, the current system allows the "futures tail to wag the spot dog". I believe this collusive, manipulative nonsense will soon come to an end with the introduction of the Pan Asia Gold Exchange later this year. If you haven't already, please go back and read this before you continue:

http://www.tfmetalsreport.com/blog/2256/page-turning

After writing the note above, I was placed in contact with a very important gentleman through the serendipitous intervention of an internationally-connected Turdite. He asked if I'd "like to speak with one of the guys responsible for setting up the PAGE". I, of course, said "YES!".

Graham Newall of Power Capital Global was recently appointed Senior Vice President of the PAGE. Below is the complete text of the questions I submitted to him last week. Graham's responses are printed in capital letters, directly below each question. I hope that all Turdites find this information helpful in developing an understanding and appreciation of the impact the PAGE will have on the global precious metals markets in the years to come.

Hello, Graham. I hope you've had a nice weekend. I am looking for some fireworks when trading resumes on the Globex this evening at 6:00 NY time. It certainly appears that this will be another interesting week.
Thanks again for allowing me the opportunity to visit with you. I am very much looking forward to seeing the impact the PAGE will have on the international spot metals markets. I firmly believe that the LBMA/Comex/BullionBank system is outdated and that the PAGE is going to usher in a new era of transparency in price discovery.
I have a short list of questions below. Would it be OK to present to my readers the list of my questions with your answers? My hope is to continue to draw international attention to the PAGE and present it as a viable alternative to the LBMA status quo.

1) Graham, can you please describe your role and the role of PCG in building and/or managing the PAGE?
 

I HAVE BEEN APPOINTED SENIOR VICE PRESIDENT OF THE PAN ASIA GOLD EXCHANGE RESPONSIBLE FOR STRATEGY AND REPRESENTING THE EXCHANGE INTERNATIONALLY . POWER CAPITAL WILL BE THE FIRST MARKET MAKER IN THIS CONTRACT

2) PAGE is already trading a 10-ounce gold contract. Are there plans to issue a silver contract, as well?
 

THE 10OZ DEFERRED SETTLEMENT WILL START TRADING SHORTLY OF THE MOON FESTIVAL THIS MONTH. THE SILVER CONTRACT IS PLANNED FOR LATE 4TH QUARTER 2011

3) I understand that Chinese citizens can buy the 10-ounce contract through the Agricultural Bank of China. Do global retail and/or institutional investors have the same access to this contract? If not, will this access be allowed in the future?
 

CHINESE CITIZENS ARE REQUIRED TO LODGE MARGIN IN AN ACCOUNT WITH AGRICULTURAL BANK OF CHINA AND TRADE DIRECTLY WITH THE MARKET MAKER ONLINE. GLOBAL RETAIL/INSTITUTIONAL INVESTORS MAY TRADE THROUGH THE MARKET MAKERS APPROVED BROKER IN HONG KONG DETAILS OF WHICH WILL BE RELEASED SHORTLY

4) Many are anxiously awaiting the PAGE to begin trading their 90-day, rolling spot gold contract. Several questions here:
  a) What are the key differences between the 10-ounce contract and the spot contract?

THE 10OZ CONTRACT ROLLS EVERYDAY AND IS A MARGINED TRADE. THE 90 DAY CONTRACT IS A RECEIPT FOR A PHYSICAL BAR OF GOLD WHICH WILL BE FULLY FUNDED AND ON MATURITY CAN BE "ROLLED" AND ANOTHER RECEIPT ISSUED OR EXCHANGED FOR THE PHYSICAL GOLD.

  b) What is your best estimate for the date trading will begin?

I BELIEVE THAT THE CONTRACT WILL BEGIN TRADING IN EARLY DECEMBER

  c) What regulations are in place to ensure 1:1 allocation of the gold behind the contract? Is the Chinese government the supplier of the physical inventory behind the exchange?

THE GOLD WILL BE HELD IN TRUST BY AN EXTERNAL ADMINISTRATOR WITH A CHINESE BANK REGULATED BY THE PEOPLES BANK OF CHINA ACTING AS TRUSTEE ENSURING THAT THE REQUIRED 1:1 ALLOCATION IS MET AT ALL TIMES

  d) I imagine that global, institutional investors will be allowed to buy the contract. Will global retail be available?

AS THE PRICE OF GOLD APPRECIATES THE CASH REQUIREMENT WILL PROVE PROHIBITIVE FOR MOST RETAIL INVESTORS MAKING A MICRO CONTRACT TRADING ALONG SIDE THE MAIN CONTRACT A PRACTICAL NECESSITY IN MUCH THE SAME WAY AS THE COMEX MICRO CONTRACT.

  e) Can a global investor take physical delivery or must the gold be stored in China?

THE TRUST WILL HOLD GOLD STORED IN APPROVED VAULTS WORLDWIDE

  f) Are there plans to issue a similar silver contract?

NOT AT THIS STAGE

5) This also seems to be a conduit through which the Chinese government is allowing the global distribution of renminbi. For example, if I buy gold in London for $ and sell it on PAGE, do I receive renminbi for my gold?
 

THE PROVINCE OF YUNNAN HAS BEEN DESIGNATED AS A FREE TRADE ZONE OF RMB. THE RECEIPT MATURES IN RMB.

Again, Graham, thanks in advance for any assistance you can provide. My readers and I greatly value your input.  TF
 

I HOPE THIS IS USEFUL PLEASE EMAIL ME ANY TIME IF YOU HAVE FURTHER QUESTIONS - I WILL KEEP YOU INFORMED AS THE FINAL DETAILS ARE WORKED OUT.
Best regards
Graham

​Out of respect for Graham's time, I'd tried to keep the list of questions relatively short. However, as you can see, Graham has graciously offered to answer follow-up questions, as well. Again, I will not inundate him but, dear reader, if you have a burning question for Graham, please include it in the comments below and I will pass a few along to Graham early next week.

Thanks again to Graham and all Turdites everywhere for your contributions to TFMR!  

TF

278 Comments

Tesla's picture

Morning Turd, Everyone...

Thanks again man - you ROCK!

speconomist's picture

Sure it looks like a

Sure it looks like a game-changer, anyway, it's a bull market, you know. Thanks for sharing his answers with us Turd!

Enjoy today's Keiser Report:

ReachWest's picture

Fantastic

This is great information - right from one of the key inside players!

PAGE looks to be a true game changer - 4th Q should be very interesting. The LBMA and the COMEX manipulators days are numbered.

boricuadigm-shift's picture

Awesome

You have outdone yourself Turd!  I'm really proud to be part of this community.  Keep on rocking!

Shill's picture

Keep up the great work Turd,

Keep up the great work Turd, and thank you for all you do.

FEED THE TURD!

Strongsidejedi's picture

key statement is...

AS THE PRICE OF GOLD APPRECIATES THE CASH REQUIREMENT WILL PROVE PROHIBITIVE FOR MOST RETAIL INVESTORS MAKING A MICRO CONTRACT TRADING ALONG SIDE THE MAIN CONTRACT A PRACTICAL NECESSITY IN MUCH THE SAME WAY AS THE COMEX MICRO CONTRACT.

Translation :  Buy physical and keep stacking.

exiledbear's picture

As long as you can take delivery, I don't see anything

Too sketchy here. IF they let you take delivery. If instead they're insistent on settling everything in RMB, then I'd say it's just another Chinese screw job.

Show me the delivered gold, that's all I'm going to say for now.

Maryann's picture

Turd...

Turd, I believe God is guiding your steps and allowing you access to information and people that will bless so many of us as difficult times approach the world.  

I pray that as you continue on this path that you will find strength and wisdom to deal with the inevitable challenges that will come your way. 

Know that there are many of us out here who are praying for you and supporting you.  Thanks to you and your family for your commitment and courage.  Thank you for helping us prepare.

austrian12874's picture

so...

What does this exactly mean for silver? what is the impact?

Stormdancer's picture

For most of us "buy physical

For most of us "buy physical and keep on stacking" was all we intended to do.  I don't ever anticipate opening a position on PAGE.  I'll continue putting tiny incremental bits of tension into the physical markets just like our little army of ants has been doing for ten years.

But there will be much bigger fish very interested in PAGE....and they have the potential to finish the work we've begun much faster than we could alone.

Especially when they get that international warehouse system up and running.  Taking delivery in London, Zurich, Kunming and some middle eastern location will provide global access.

ginger's picture

TF... ..exactly what Maryann

TF... ..exactly what Maryann said. ..Thank you for everything. Incredible resource you've got there and thanks to that internationally well-connected fellow turdite as well! (you know who you are wink)

From end of last thread...

Hey Margarita.. Smiley

I'm still around.. ...trying my best to read/keep up with everything I can here ...all the awesome posts and information from you guys.. ..Just been busy with a few really important things that have been on my heart lately.. ...Keep posting girl.. you teach me so much ;)

Crow.. just an excellent post.. ..this: "To be honest though my emotions are torn on between trying to ensure the financial survival of my family and friends and the agony of sitting by idely while the majority of Americans unwittingly accept serfdom." is exactly what I feel. I think you do....and most of us here...try to be involved and help others to see what is ahead. A few turdites were sort of talking about this very thing over on the faith thread recently. ...How do we know what to do.. ..where God has put us. It seemed to be the consensus that even in small ways.. just do what is before you. That one word or one thing you do even if seemingly minor could make all the difference to someone. Just stand where He allows you to be and have a willing heart to see what it is He has put before you. That is all I know to do.

Stormdancer's picture

@austrian12874

The potential impact on silver isn't at all clear to me yet.  It appears to me he's saying there will be a rolling silver (margined) contract but no 90 day "deferred settlement" contract that matures into a bar of silver.

I'm making some assumptions here...but it sounds like the rolling contract is not deliverable.  If that's accurate, it sounds as if there are no plans to deliver silver.

Interesting.....

California Lawyer's picture

I am confused

First, let me say THANKS TURD!!!  Awesome info.  But my problem is that I just do not see how this new scheme is any different than the old scheme.

Gold is held in approvd Chinese vaults, which is just like the current scheme only a different controller of the vault.  The new scheme still requires trust that the metal is really in the vault.  Why should I trust the Chinese any more than I trust the criminal bankers who  through fractional reserve trickery have leveraged the actual metal at better than 100 to 1?

Or am I just not understanding?  Let me make it simple.  Say I want to buy one ten ounce bar.  I would deposit frn's with my broker.  My broker would then purchase one gold bar contract from Power, turning my frn's into renminbi.  So now, my former frn's are now on deposit at a Chinese bank as renminbi.  The PAGE then takes my renminbi and buys a ten ounce bar of gold, and deposits that into a vault, with a serial number.  90 days later I decide I want my bar of gold.  So, I demand delivery.  Then what?  Can I  go walk into a bank and get my ten ounce gold bar or not?  

If 

Tabberto's picture

PAGE

Hello all. One of the most interesting and indelible effects of PAGE will surely be the new Chinese FIX in the dark hours of the 24hr Pmetals market.  This FIX will be against PAGE's allocated contracts and involve only Chinese Banks and imo will be a cold shower for the 'loco' LBMA system and the relentlessly dubious practices of its mostly dubious membership.  If the shorts cant smell this coming due to the overwhelming smell of their own B.O. then the forthcoming religious experience will be all the more bracing for them.  There must be a whole hidden chapter in Sun Tzu Art of War about this exchange!

90 day rolling 400oz spot Gold contract

Options:

Roll

Redeem in Rmb

DELIVER

Once all wheels are turning properly on this puppy you will be able to move 'that' Gold that the LBMA members 'store' for you (on an allocated or unallocated basis) in London/NYC etc into a shiny Chinese Bank in the same city - to be deposited/available within PAGE.  It makes my heart sing...the clock is ticking and this is going to end very well for all of us Turdites living the Goldbug total lifestyle(!)

Dr Jerome's picture

What will metals dealers do with PAGE?

I am curious to see if the price of Gold has true discovery in PAGE and will still be manipulated on COMEX, creating a "true" price and a "false" one.

If PAGE strongly influences genuine price discovery, what will the c/c/c do?

I wonder which price will Apmex, Gainsville, Tulving, Provident and other physical suppliers will use to price their product? buying and selling? 

Stay tuned for the action. December is shaping up to be as interesting as last April's hoped-for default of Comex, but with less dissappointment.

Tabberto's picture

CaliforniaLawyer - within reason yes - you would

within reason yes - you would be able to get the metal because there will be depositories at Chinese Banks in Western cities.  The mini-contract is what you are talking about with only 10oz - but i cant see any reason why this is not practical even with small denominations.  It wont be popular with the established banks in town as it were but you can't make everyone happy in life!

Tabberto's picture

stormdancer

SD they will do Silver in due course but the whole shabang is quite and undertaking so they want to concentrate on Gold for the time being.  The Chinese people love Silver and are buying it hand over fist at Beijing Gold Exchange retail shop level so there is no reason to imagine that this isnt a natural add-on.  The rolling spot contract is absolutely deliverable, GNewall is quite explicit in saying that the receipt is exchangeable for Gold in the email to Turd

Larry L's picture

That is GREAT Information!!

Thanks Turd for the info. Many of us will probably not do trades with PAGE because of the RMB in return unless you are Chinese. Even though this does tell us more smaller investors world wide will be able to participate in the Great Gold Rush of the 21st Century. I can only see the upward motion of this giant coming soon!  Stack up those physicals.

Will this arrangement make the RMB a gold backed dollar?? 

Have a blessed day!

L13's picture

"Once all wheels are turning

"Once all wheels are turning properly on this puppy you will be able to move 'that' Gold that the LBMA members 'store' for you (on an allocated or unallocated basis) in London/NYC etc into a shiny Chinese Bank in the same city - to be deposited/available within PAGE.  It makes my heart sing...the clock is ticking and this is going to end very well for all of us Turdites living the Goldbug total lifestyle(!)"

What happens if the LBMA members for instance refuse to recognise or do business with the PAGE - since the whole PAGE setup is a threat to them..

What then?

Turd Ferguson's picture

CA - watch this again

MODERATOR

You make some excellent points but I think you need to consider things from a much larger perspective.

http://www.goldmoney.com/video/naylor-leyland-turk-interview.html

Response to: I am confused
NW VIEW's picture

@ California Lawyer

You are not confused at all but the masses of investors who put their trust in China have forgotten their past actions. Once all the gold is safely stored in China, the government can just say " we have a policy change and we decided to keep it for the good of the people (China)".    I'll keep my own stack.    I have not been happy with them since the days of their treatment of Watchman Nee and they will do whatever they want when they have the control. 

Turd Ferguson's picture

Confirmation

MODERATOR

From Harvey re Thursday:

The total gold comex open interest fell by 3000 contracts to 514,198 from Thursday's reading of 517,132.
Since gold was on a tear on Thursday we must have had some bankers cover a small fraction of their shorts.  

As I suspected, much of the huge rally on Thursday was Cartel short-covering...accepting the gift offered them by the SNB. This is beautiful! They are turning on each other!

FogHorn LegHorn's picture

Ditto ginger maryann TF

Well done! TF ;
By, Your good works done here for Us, You and Your loving family are surely blessed by Our Father.

I am so very pleased at the Greater PMs industrys inclusion of Our TF!
I Predicted TFMR, was/is going to go viral a week or two ago and can envision an exponential increase in readership, market presence, and scope of TFMR!

The goal is to reach out and inform and protect as many as possible!

An objective, TF that You are achieving with civility and grace! :)

Thank You!

We are blessed by You as You are blessed by Him.

Huggs to You, Mrs.F, T1 and T2 and everyone else, pets and peoples O:-)

California Lawyer's picture

Turd - Thanks, I Think I Get It

Price discovery and allocation/delivery are key.  That makes sense.  But won't the cartel do everything in their power to prevent true price discovery?

jlee2027's picture

Not enough silver

With Silver scarcer than Gold and tight supplies, I doubt they can guarantee physical silver delivery. That might be the problem.

Doesn't matter. When Gold does a moonshot, so will silver.

averagejoe's picture

agree

I agree this is just adding paper to the paper game. Why trust China all of a sudden? Now citizens that used to buy physical buy paper. I must be missing something, everybody seems to excited about the newest addition of a paper game.

Gold stored in allocated vaults around the world. Let me guess JPM vaults. Sigh C

See CA lawyer covered my thoughts.

China may want more gold at a cheaper price to. They have learned from the best.

Stormdancer's picture

@Tabberto

You may well be right, but I'm not fully convinced just yet.  They might not do more than a margined contract for silver if they were concerned about obtaining enough silver to back it.  That was what was behind the "interesting" comment I left unexplained.

Clarity will come soon enough I'm sure.

But also note, there are two distinctly different contracts being talked about.  One is margined and the other is fully paid for and backed by a warehouse depository receipt for a real bar of gold.  I still suspect that the margined contract is a speculative vehicle and not deliverable.   I'd guess if you want delivery you'd have to purchase the 90 day deferred settlement contract and fund the account for the full price of the bar.

It looks to me like they're making a distinction between speculative and deliverable contracts but ensuring the prices of both are the same... binding margined, speculative gold to the deliverable spot price.

Hard Rain's picture

Intentions

As you live, you encounter all sorts of people, who all have varying agendas and intentions.

Turd, you intention is honorable, and I can only hope that you get all the good things that are/will be coming your way. You deserve it!

This blog has made an important contribution to my knowledge and has opened my eyes to many things that I never thought of before.

And to that end I give credit to all that contribute and post on a myriad of topics, that when combined together, will soon make TFMR the #1 PM site in the world.

I wish everyone all the best as they prepare for whatever may eventually come our way.

Have a terrific weekend, everyone!

Rain

FogHorn LegHorn's picture

PAGE

I look forward to PAGE, because it alters the status quo, the too close, too often, self serving relationship of the bullion banks and the exchanges.

The foxes, gaurding the hen house!

The current set up allows, a "thumb on the roulette wheel." Anything that removes that "thumbs pressure", is Ok in my book. PAGE, will add competition to the Anglo/American exchanges, and offer RMB exposure to retail investors.

The ongoing accumulation of gold tonnage by China, seems to make the exposure to RMB intriguing, notwithstanding political risks. AT the very least, it will make price discovery less dependant on the bullion banks and J Dymon's paycheck will decrease.

The latter makes Me smile, well worth the PAGEs creation costs.

ScottJ's picture

Make Way for a new Interntational Currency

The question becomes, with gold contracts being redeemable in RMB (pseudo-gold backing their currency), what will become of the dollar? (and the euro, pound, franc, and all western world "trust" backed currencies).  Cue new crazy banking scheme in 3....2.....1.....

5) This also seems to be a conduit through which the Chinese government is allowing the global distribution of renminbi. For example, if I buy gold in London for $ and sell it on PAGE, do I receive renminbi for my gold?
 
THE PROVINCE OF YUNNAN HAS BEEN DESIGNATED AS A FREE TRADE ZONE OF RMB. THE RECEIPT MATURES IN RMB.
 
The End of Keynesian Economics is nearing by the day.
 
Very cool list of questions to be asked to the source.  The world is a different place in these times, look at the power of the internet and what can be achieved (in awareness).
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