An "Open Letter" Update

Wed, May 14, 2014 - 8:52pm

By now, you've likely had a chance to read the open letter to Switzerland. Since it was posted late Monday, there have been several, interesting new developments. I thought I would pass them along.

First of all, a reminder...

I am a blogger, not a journalist. My job is to analyze this situation and, based upon my accumulated experience, pass along my opinions. Your job is to read my opinion and then decide whether or not is is valuable.

(If you haven't yet read the open letter, here's the link:

That said, in writing the open letter, I was speculating and drawing conclusions. For me, it all makes perfect sense. In September of 2011, the SNB went "all in" with the fiat currency scheme. In doing so, they converted the last of their physical gold reserves into paper claims and these claims were used to suppress paper price away from the all-time highs seen at that time. What remains now for the Swiss people are nothing more than promissory notes to unallocated accounts. Their gold...their independence and likely gone for good.

It may not be too late just yet, however. Later this year, the national referendum will be scheduled and the vote could potentially demand that the SNB return the Franc to a gold backing. This unique, democratic process is what makes this issue so compelling. For if the Swiss people can become fully aware of the situation and the potential impact of this vote on them and their posterity, might they be roused to demand this change? Maybe.

So, at this point, it becomes even more vital that my conclusions regarding the Swiss gold reserves are plausible. It's one thing to speculate. It's something entirely different to be right. To that end, several folks have emailed me within the last 24 hours, offering to help. To save time, some of the emails are copy-and-pasted below. The most compelling come from James Turk and a Swiss reader named Dominik. Please read and consider, then formulate your own conclusions:

Hi Craig,

I learned about your article from the GATA dispatch, which I read this morning. As soon as I read it, I took a look at the Swiss National Bank 2013 audited accounts in its Annual Report.

I hadn’t looked at the SNB's audited accounts for several years, but my recollection was that they reported how much gold was on loan as well as how much physical metal they held. So I was surprised to see that they no longer do that. The SNB’s balance sheet does not report that info anymore, with the result that as you wrote in your article, the SNB’s gold could very well be put into the market - meaning it is being used in the gold price suppression scheme.

I therefore immediately wrote to one of my contacts in Switzerland who is involved with the various gold initiatives there. Our correspondence is appended below, but because I do not have his permission to use his name, I have deleted it.


Von: James Turk (to James' Swiss contact)
Datum: 13.05.2014 10:52
Betreff: Fwd: [GATA] TF Metals Report: Swiss gold was used to bomb the price and now it's gone

The article appended below is interesting. After reading this article, I looked at the Swiss National Bank’s balance sheet in its latest annual report.

The article could be right. It is possible that much - or all - of the Swiss gold reserves of physical metal are gone.

The SNB’s precious metal asset is listed on p146 as “Gold holdings”. Then in the footnotes on p153, it defines what “Gold holdings” means as follows: “Gold holdings consists of gold ingots, gold coins and claims on metal accounts.”

The report does not show what portion of the “Gold holdings” are in these three categories, so it is possible that much - and maybe all - is a claim on a metal account, perhaps a metal account at the BIS. If so, it is possible that as the article below says, the Swiss gold reserve is gone. Physical metal has been turned into a paper claim.



On 13 May 2014, at 10:56: (reply from James' Swiss contact)

Hi James,

Thanks for the info.

Though I can't find / open the article, if it were true that the gold is gone it could cause a political earthquake, in Switzerland and worldwide, for the following reason:

There is a popular initiative pending which, among other things, requires the SNB to hold 20% of their reserves in gold. Due to the partly unfortunate wording of the initiative it got torn apart in parliament. Nevertheless it will be put to popular vote later this year.

So far it has little chance of succeeding. If it could be proven that there is no gold that would change it all and create the first constitutionally protected gold backed currency.

If you can get proof, I know whom to give it to for maximum effect. I keep my fingers crossed.

Von: James Turk (reply back to the Swiss contact)

Datum: 13.05.2014 12:22

Betreff: Re: Antwort: Fwd: [GATA] TF Metals Report: Swiss gold was used to bomb the price and now it's gone

The only thing I can suggest is to put pressure on the Swiss National Bank to disclose the details of footnote no. 1 to their audited financial statements by showing how much gold is in each of these three categories:
1) ingots/bars
2) coins
3) claims to gold

Nos. 1 & 2 above are tangible assets representing real, physical metal. No. 3 is just a financial asset; it is not real, physical gold. It is just a debt obligation owned to the SNB by the BIS or other banks that received physical gold shipped to it by the SNB.

Hmmmm.....Well that's all pretty interesting, now isn't it? Mr. Turk definitely thinks that I'm onto something and that the Swiss gold may, in fact, have been converted entirely into paper claims.

However, last evening I received this email from a guy in Switzerland named Dominik. It would seem to be very important that you read what he had to say, too:

Dear Mr. Ferguson
I read your article “An open letter to the good people of Switzerland”.
SNB has been disclosing its gold lending activities for over ten years. It is required to do so because it is an exchange-traded corporation that reports under Swiss GAAP. Its financial statements are audited on an annual basis. Below you find some data that I extracted from old SNB annual reports. It shows that gold lending was once rampant, but has ceased gradually over the last ten years.
As much as I am myself critical of SNB, paper money and inflationism, we have to stick to the facts. I think it would serve you well to add this information to your article.

SNB tonnes of gold lent out or claims on metal accounts
SNB interest income from gold lending transactions
2002 254.6 54.8
2003 232.9 32.9
2004 131.8 22.8
2005 134.6 34.9
2006 119.6 15.6
2007 138.4 13.5
2008 111.6 12.6
2009 92.7 8.8
2010 15.0 9.5
2011 15.0 1.0
2012 0.1 0.2
2013 0.1 -


So, I sent Dominik's information off to Mr. Turk and asked for his opinion. He graciously sent back this detailed and thoughtful response:

Craig, I have seen so much trickery in the way banks have reported their accounts, it is useful to be skeptical. And I am skeptical of what Dominik says below, which at first blush looks clearcut. However, there is a loophole here that needs to be considered.

I am not a lawyer, nor an accountant, but it seems obvious to me that a “claim to a metal account” is different from a “metal account”.
Law Dictionary: What is CLAIM, N 1? definition of CLAIM, N 1 (Black's Law Dictionary)
A claim is a right or title, actual or supposed, to a debt, privilege, or other thing in the possession of another.

So a “claim to a metal account” means the “metal account” is in someone else’s possession, e.g., the BIS maintained and was operating the “metal account” for the SNB, and the SNB only had a claim to that metal account. But the SNB annual reports says “claims to metal accounts” so we know that there was more than one claim and more than one metal account. So presumably other banks were involved, and logically that would mean the big bullion banks.

Why does the SNB annual report say “claims to metal accounts”? Why doesn’t it say just “metal account”? Is there a willful attempt to deceive and mislead? Does the SNB actually keep gold in “metal account(s)” at other banks but does not report them in its accounts? Unfortunately, we just don’t know.

Regarding Dominik’s comment about GAAP, the Bundesbank according to the Bundesbank Act is required to report its accounts according to GAAP, but doesn’t. The Bundesbank reports gold on loan and gold in the vault as one line item, which obviously is contrary to GAAP because you are mixing two very different assets - a tangible asset in a vault and a financial asset with counterparty risk. The reason the Bundesbank defies German law is because it is a member of the IMF, which for Bundesbank accounting is a higher legal authority than German law. I assume the same thing applies to the Swiss National Bank.

One last point. Depositing gold into a metal account is essentially the same thing as lending gold. The difference is that only banks can accept “deposits”, regardless whether those deposits are made in a national currency or gold. The deposit is a liability of the bank, which is for all practical purposes the same as if the bank borrowed that same gold - it is a liability of the bank in both cases.

Thus, it is possible that the Swiss gold has been removed from vaults and put into the market by depositing the gold into “metal accounts” the SNB maintains at the BIS and the big bullion banks, which are metal accounts not reported by the SNB in its audited accounts. Note I say “possible”. Whether they are in fact doing that or not is the key, and it would be interesting if someone (like the Swiss parliament or some Swiss government auditing body) were to put that question to the Swiss National Bank. I would at the same time also ask the SNB why they at one time had outstanding “claims to metal accounts” but no longer do so.

You can use the above in an article if you want or share it with Dominik. You can send it to him along with my email address in case Dominik wants to contact me to explore this further.



And so the intrigue deepens and all of this seems to demand a further investigation. To that end, Chris Powell of GATA is now on the case. Earlier today, he sent me this email:

James and Craig:

I've just sent this off to the communications department at the Swiss National Bank, seeking comment about Craig's fine work this week. I may ask Lars Schall, the German freelance financial writer, to do the same thing. I've already sent Craig's commentary to my list of mainstream financial journalists and financial letter writers, not because any of them will ever put any questions to the SNB but just so I can say that they were given the information and ignored it.

I also may do a GATA Dispatch asking our followers in Switzerland to put the questions to the SNB on their own. Maybe we can achieve a little transparency here.


---------- Forwarded message ----------
From: Chris Powell <cpowell[at]gata[dot]org>
Date: Wed, May 14, 2014 at 11:15 AM
Subject: Swiss gold reserves
To: communications[at]snb[dot]ch

Wednesday, May 14, 2014

Dear People:

I write to call your attention to this week's commentary published by the TF Metals Report asserting the probability that Swiss gold reserves have been mobilized lately to suppress the price of gold --

-- and to ask a few questions arising from it.

1) Does the Swiss National Bank have any response to that commentary? Is it true or false?

2) Has the bank been trading in gold or gold-related financial instruments in the last five years?

3) If so, what was the bank's objective with that trading?

4) Has the bank loaned or leased gold in the last five years and is it lending or leasing gold now?

5) If so, what is the bank's objective with that lending or leasing?

6) Will the bank disclose the amount of its gold reserves that is held in metal in the bank's own vaults, the amount of its gold reserves that is held in metal in the bank's accounts with other depositories, and the amount of its gold reserves that have been loaned or leased and that is not held in the bank's own vaults or in the bank's own accounts with other depositories?

Thanks for whatever information you can provide.


I will, of course, keep everyone here at TFMR updated on these events as we move forward. In the meantime, I ask you again to please consider sending this information to anyone you know in Switzerland. The Swiss people have the opportunity to regain their sovereignty and, at the same time, drive a stake through the heart of Central Bank gold price suppression and manipulation. We need to offer them as much encouragement as possible.


About the Author

turd [at] tfmetalsreport [dot] com ()


May 14, 2014 - 9:36pm


Palladium just a few dollars from it's all time high while the rest of the metals languish. Is an afternoon Palladium fix in the works?

May 14, 2014 - 9:39pm

will the sale be over soon

Good follow up article


May 14, 2014 - 9:47pm

Beginning to sound like a novel

written by Clancy, Cussler, Flynn, and a host of others.

Craig; I hope you can copywrite this all.

May 14, 2014 - 9:51pm

I just hope that after

I just hope that after Michael Lewis writes a book about all of it, Brad Pitt will play Turd in the movie.

(MrsF does, too!!)

May 14, 2014 - 10:05pm

Your initiative, your book

of course when its over nobody can afford it--

but in 30 years your kids.....

May 14, 2014 - 10:05pm

Anybody besides me

who understands what direction we are headed feel really bummed out.

May 14, 2014 - 10:10pm


I believe it was I whom suggested that this go viral, hat tip :) But it is Turd that deserves all of the credit.

Great work! Gumshoe in residence! 

Spartacus Rex
May 14, 2014 - 10:10pm

O.K., But what about the U.S.' fictional Gold in Ft. Knox

Rand Paul is currently pushing to have the "Fed" audited. Let's also push to have America's 8000 + Tons of Gold in Ft. Knox audited as well, and make sure that it is NOT actually either "Custodial" Gold being held for foreign Countries, or some B.S. Bankster wordart scam such as "Deep Storage" Gold (ie As yet, Unmined gold sitting in the ground somewhere) Seriously, Go Swiss, but let's not overlook that Americans as well have likely been ripped offf by the Banksters, since Ft. Knox has NOT been actually audited since the 1950's for crying out loud!

May 14, 2014 - 10:13pm

Re: Mickey...

In some ways yes... how do you feel bummed?

John Galt
May 14, 2014 - 10:15pm

Excellent post, Turd!

Mrs. G would be thrilled if George Clooney played your sidekick in that movie.

Dark Horse
May 14, 2014 - 10:16pm

Well done Turd

Have you sent it to the Tylers of ZH?

45 North Mickey
May 14, 2014 - 10:17pm

Water Park

Yup, feel like I am on a great big slide in a water park that ends up in a sewage lagoon.

And yes, it is full of Turds. (the bad kind)


May 14, 2014 - 10:19pm

I usually need more money

Right now I need more time

Turd you are stretching my resources. I hope to digest all of this before my Bombay and tonic kick in. You are on fire brother keep kickin' them rocks. I'd like to play a cameo as Havenstein in your movie.

Dark Horse
May 14, 2014 - 10:26pm

Citizen Initiated Referendum - US

Apparently 24 of the US States have inbuilt into their law the right for Citizen Initiated Referendums.

California is a good example.

Why would the citizens of California not desire a referendum to seek independent annual auditing of Gold reserves held at Fort Knox on behalf of Californian Citizens?

I am from Australia, unfortunately we do not have this constitutional right.

ps our Central bank sold 167 mt tonnes of its 247 mts of gold in 1997 as it was not deemed a "good investment".

Our remaining 80 mt is held in UK...which means it is gone.

John Galt
May 14, 2014 - 10:27pm

Ft. Knox Gold

My feeling is that Ft. Knox gold has either been shipped out entirely or been replaced with IOUs for gold plated tungsten.

Then again I wouldn't be surprised if the real gold was actually there. The question is, though, whether the gold belongs to "The United States" as in We the People, or to "the United States" which is a separate corporate entity that was incorporated by bankers in 1871 and headquartered on sovereign land we now refer to as the District of Columbia.

May 14, 2014 - 10:42pm

Why No Audit

How many years have we wanted an audit. How many years have the highest levels of leadership not pushed for an audit. Why is it different now...or will it be any different now.

When criminals are exposed to the point that their activities are public knowledge, do they confess. No...they fight back. Our leadership owns the means to fight or impose force. But they have defined the people as their enemy to enjoy personal gain.

Where is the press, the media, the regulators...the backbone. Where are the Courts. Where is Congress.

Where is Corporate America for that matter. They all can't be traitors. Too big to fail only applies to fraudulent massive derivative/swap indebtedness of the institutions that have chased those paper failures. It never has applied to the "people" that commit the crimes within those institutions, that have burdened the economic system. Bankers are not protected and their loss through criminal prosecution never has or never will threaten the banking system. Only their actions have placed the system in the dark pools of death. One by one they need to be placed in the prisons and one by one the banks need to be reorganized and broken up.

Apples and oranges. Bankers are expendable. The tough part is how to save the country from the damage that has been done, if it can be saved. They have exported the criminality around the world. Maybe all can be saved with the defeat of Central Banking and massive restructuring.

It is very difficult to correct when so many empowered with fiduciary trust have chosen to promote self betterment.

May 14, 2014 - 10:44pm

Turd, you might need protection

And I would prefer Brad Thor write the book.

Spartacus Rex
May 14, 2014 - 10:49pm

@ Keg

Re: "I would prefer Brad Thor write the book." Hell NO! Michael Lewis, Hands Down By Far!

Spartacus Rex
May 14, 2014 - 10:53pm

@ Lakedweller2

Re: "Where is the press, the media, the regulators...the backbone. Where are the Courts. Where is Congress (?)"

What? Is is NOT Obvious? 100% in the Pockets of the counterfeiting Masters of Fiat! Otherwise they would be Out of Work & STARVING right now!

Spartacus Rex
May 14, 2014 - 11:18pm

@ John Galt

Re: " The question is, though, whether the gold belongs to "The United States" as in We the People, or to "the United States" which is a separate corporate entity that was incorporated by bankers in 1871 and headquartered on sovereign land we now refer to as the District of Columbia."

For Crying Out Loud! READ the actual Text of the Act, so you can finally grasp how embarrassingly moronic you sound when you parrot that tripe! Seriously J.G., do you actually enjoy letting faceless ignoramuses on the Internet blow smoke up your backside? 

May 14, 2014 - 11:19pm

All talk and no gold

All this talk about the Swiss gold and nobody is posting any pictures of it? Well, I am not going to stand for that! How are the Swiss people going to find their gold if they don't know what to look for?


Dark Horse
May 14, 2014 - 11:24pm

Donation for Swiss Press Release - 2 silver ounces

I would be happy to donate to you turd for a press release to be sent to a number of swiss media outlets (companies provide this service for a modest fee to email your story/content to their contacts list).

Any else happy to donate an amount equal to 2 silver ounces?

John Galt
May 14, 2014 - 11:46pm

@ Spartacus Rex re: Fort Knox Gold

Attached is a link to the US Mint website, where it states that title to the gold at Ft. Knox belongs to "the United States".

That is a different legal entity than "The United States", which is what most Americans believe is representing "we the people".

Although the two are spelled the same, the change of capitalization on the word "T/the" creates 2 different legal entities.

That aside, you really should check the expiration date on your asshole pills. 

boomer sooner
May 14, 2014 - 11:54pm

Dark Horse

How to apply US Gold holdings to states, I dont know, but here is our referendum statute. 1/50 share #of states or 1/50 # of population (330/6 million)

​Write it up (I wouldn't know here to begin) and I'll run it by one our persons running for office. Probably be a good reaction! Best one would be Randy Brogdon (have an HUGE $ supporter of his as a customer). I'm afraid Randy does not have a great chance of winning Coburns seat, probably will be TW Shannon. As long as we get rid of RINO James Lankford.

Spartacus Rex
May 15, 2014 - 12:00am

@ J. Galt

Yeah, Very Funny J.G.. However, unlike me, you have absolutely ZERO Schooling, Efficiency, Expertise and Experience in LAW! Got it Now? Even so, can you not even remotely imagine whereby the Adversary (Banksters) would deliberately engage in dis-information propaganda on the Internet so as to discredit the Patriot Community? Get a Clue, and stop presuming that just because something "sounds" good or useful on its face, that it is indeed, actually & factually CORRECT! (ie Be a part of the Solution, NOT engaged in perpetuating the Problem: IGNORANCE!)

Clarki Stomias
May 15, 2014 - 12:10am

A new ETF with actual, deliverable gold for just 100 shares?

You kiddin' me?

Will have to carve out some time this weekend to read the prospectus.

----------------------<edit> ------------------------------

Also, where will they get the gold for this ETF? I hear the Fed is a good source.

One more thought. Wouldn't this increase investment demand for gold? I thought that was a no-no. Was Janet informed about the creation of this product? Methinks there may be backlash from TPTB here. It will be interesting to seewhat happens when this makes it to the market this Friday and how they will actually get "inventory" should demand increase.

John Galt
May 15, 2014 - 12:14am

OK Spartacus, I'll Play Your Game

Since you have deemed me to be completely ignorant and unschooled, and suggest that I have been duped by banker disinformation propaganda that is designed to discredit the Patriot movement, please enlighten me with your wisdom:

1. What is the real problem with the world as you see it? (and since this is a PM site please limit your diatribe to PMs and an explanation of the truth behind those who run the global Keynesian economy);

2. What is the the solution to the problems identified in the question above?

May 15, 2014 - 12:31am

Brad Pitt is a girly man. 

Brad Pitt is a girly man. Now, this guy even looks like our glorious host.

Spartacus Rex
May 15, 2014 - 12:38am

@ John Galt, Re: "I'll Play Your Game"

Get OFF the High Horse & Get this through your head J.G., This is NOT a GAME! So seriously PLEASE, get a Refund for any potential EGO Trip, and be willing to LEARN from those who have been involved in this Battle for over 4 and a half Decades, as you more likely than not, still retain the capacity to LEARN from actual Experience rather than to presume via default that you Know It All! (Ergo, Nobody can Teach you anything worthwhile. THAT is how the Adversary WINS! Unless you would rather spend the 3 Years and earn your own J.D.!) 

Clue: One CANNOT & SHOULD NOT call, or equate a "substitute" or mere "promise to pay" something, as the actual thing promised ITSELF. Especially when the object is actually DEFINED IN LAW! Hello? The LAW actually says OTHERWISE! (This is HOW the Banksters WIN, and EVERYTHING ELSE is BULL-SH*T!)

Safety Dan
May 15, 2014 - 12:55am

@ Spartacus; John Galt is correct, see below;

From a past post with the link:

United States is NOT United States Of America.. Hence Oath.. by Safety Dan

10 weeks 2 days ago

I will likely take some heat for this; however it is important to understand who you swore an oath to serve..

First the Oath with the differences in this link:

Then an explanation of the differences with citations:

...When they came together the first time to form a Union of several (plural) States, they decided to call themselves the "United States of America".

Note also that those Articles clearly distinguished "United States of America" from "United States" in Congress assembled. The States formally delegated certain powers to the federal government, which is clearly identified in those Articles as the "United States".

Therefore, the "United States of America" now refer to the 50 States of the Union, and the term "United States" refers to the federal government.

The term "United States" is the term that is used consistently now throughout Title 28 to refer to the federal government domiciled in D.C. There is only ONE PLACE in all of Title 28 where the term "United States of America" is used, and there it is used in correct contradistinction to "United States":

Now why the differences are so important: 

UNITED STATES is a Corporation - There are Two Constitutions - Sovereignty

​While I have not served in the Military I spent 2 years in Iraq and 3 years in Afghanistan working for the DoD serving the Military... If that matters.. 

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