Guest Post: "Why Invest In The Monetary Metals and Their Miners If They Won't Defend Themselves?", by Chris Powell of GATA

Wed, Dec 21, 2016 - 9:06am

Echoing some points we've made here recently, today GATA Secretary/Treasurer Chris Powell slams the pathetic rock-breaker CEOs of mining companies for failing to understand the forces aligned against their companies. In doing so, these short-sighted geologists harm not only their companies and employees but their shareholders, too.

Please be sure to read Chris' post AND please be sure to support GATA as they are an indispensable ally in the fight against the corruption and fraud of The Bullion Banks and their co-conspirators in government and the media.

"Why Invest In The Monetary Metals and Their Miners If They Won't Defend Themselves?"

by, Chris Powell, Secretary and Treasurer of GATA

The more it exposes and documents manipulation of the monetary metals markets by governments, central banks, and their agents in the financial industry, the more GATA is resented by those in the monetary metals industry who are merely touters of mining shares.

That's because GATA tells people what they are up against when they invest in the monetary metals -- indeed, when they aspire to free and transparent markets and to liberty itself. So while there was a victory for GATA in this month's disgorgement in federal court in New York of Deutsche Bank's electronic records of market rigging by its traders and the traders of other banks, on the whole the revelations may have been a defeat for the mining industry.

Toronto market analyst and broker Michael Ballanger explained why in his financial letter this week:

Ballanger wrote: "Until the regulators can finally put an end to this horrific process whereby the bullion banks have a total carte blanche to issue as many [futures] contracts as they desire under the guise of 'hedging,' prospective gold investors are simply going to say, 'Nope, not playing.' The intervention, collusion, and bank-coordinated gang attacks such as we are now witnessing via the Deutsche Bank evidence coming out is actually having a negative effect on sentiment, because as much as the revelations are creating transparency, they are also scaring prospective investors. The prevailing wisdom emanating from the trading desks is: 'Wow! If they can get away with that, why would anyone put money into the gold and silver markets?"

The Deutsche Bank disgorgement has incriminated not just Deutsche Bank itself but all the recent participants of the daily London gold and silver price "fixings" -- HSBC, Bank of Nova Scotia, UBS, Barclays, and Societe Generale. But apparently none of them is reported to be under investigation by government law-enforcement agencies for rigging the gold and silver markets. Indeed, three years ago the U.S. Commodity Futures Trading Commission announced that it had closed a five-year investigation of the silver market without finding any cause for an enforcement action:

While the CFTC has subpoena power and dozens of investigators, it apparently was unable to discover what the anti-trust class-action lawsuit in New York did.

It is not hard to understand why the CFTC might have failed -- or, rather, why it might not have tried very hard. That is, all the trading bank defendants in the gold and silver lawsuits are also primary dealers in U.S. government securities, the most intimate associates of the Federal Reserve Bank of New York.

This is unlikely to be a mere coincidence.

According to the New York Fed --

-- "Primary dealers are trading counterparties of the New York Fed in its implementation of monetary policy. They are also expected to make markets for the New York Fed on behalf of its official accountholders as needed, and to bid on a pro-rata basis in all Treasury auctions at reasonably competitive prices."

Gold and silver are money, and as GATA's documentation has shown, governments still treat them as such and they remain of great interest to "monetary policy," which is not to let them compete effectively with government-issued money. Governments and central banks can't be much bothered by their primary dealers pushing gold and silver prices around as long as the primary dealers are pushing those prices where governments and central banks want them to go and providing camouflage for government and central bank intervention.

But if that explains the failure of governments to prosecute the gold and silver market riggers, what explains the silence of the monetary metals mining industry and its nominal representatives, like the World Gold Council, even after Deutsche Bank's disgorgement? Enough clamor and exposure would compel governments and central banks either to stop rigging the monetary metals markets or at least to do it in the open, which soon would destroy the rigging's effectiveness, as doing it in the open destroyed the London Gold Pool in 1968:

Yet mining companies and the World Gold Council act as if they are owned by the governments destroying them. The mining companies do not act as if they understand the monetary nature of their products or their own function as minters of independent money for free people.

The mining industry's failure to defend itself against predators goes even beyond this. The industry doesn't defend individual companies being systematically victimized.

As Rudi P. Fronk, chairman and chief executive officer of Seabridge Gold, a company that long has supported GATA, writes today:

"I don't know if you have been following the recent trading activity in Seabridge, but last week the company got caught up in a significant rebalancing of the exchange-traded fund GDXJ that occurred Friday with more than 2.17 million shares sold as a block at the close. Going into last week, GDXJ owned just over 6 million common shares of Seabridge, or approximately 12 percent of our shares outstanding. The fund ended the week owning only 3.7 million shares (7 percent of Seabridge), having sold more than 2.3 million shares of the company during a tough week for gold.

"Unfortunately we do not get any notice of the extent of these rebalancings and learn about them only after the fact. But it is clear to me that someone knows ahead of time about the rebalancings, as we get shorted days before the block crosses with the shorters knowing that they will be able to cover at a low price with the end-of-week block.

"This has happened to us before, and while such events usually make great entry points for new buyers, current shareholders get screwed."

The mining industry should have an association to clamor against such mistreatment as well. But where is it? The World Gold Council seems to function mainly to divert into mere derivatives investment funds intended for real metal and to ensure that there never is a world gold council.

So what can be done by investors in the monetary metals and by advocates of free and transparent markets and limited and accountable government?

Plenty can be done, once you realize that, powerful as the other side is, exercising all the power of government, its most powerful weapon is your own demoralization.

For starters people can challenge the gold and silver companies in which they are invested, insisting that company executives review the documentation of surreptitious intervention in the gold and silver markets by central banks and take a position on it:

Is the documentation genuine and valid or forged or misconstrued? If the mining industry protested about it to its elected representatives in government, it would make serious trouble.

Second, people can query their elected representatives about the market rigging -- urging them to review and investigate the documentation as well and to question treasury and central bank officials about it. Are governments surreptitiously trading the gold market and, if so, for what purpose? Then any responses or refusals to respond should be publicized.

The same questions should be directed to financial regulators too and their answers publicized -- particularly the U.S. Commodity Futures Trading Commission, whose failure to crack the silver case is now a spectacular embarrassment.

Sensational as the revelations in the Deutsche Bank case have been, the case has a long way to go before resolution. It likely will prompt more lawsuits against more trading banks, but maybe not until the current case is resolved. No one should wait for that.

And of course since apart from the lawsuit in New York only GATA seems to be doing anything about this fraud, people can support us financially:

Even a $5 donation will be more than Newmont Mining has contributed to the cause.

The logic of the use of derivatives to suppress monetary metals prices is that there is enormous potential for prices to explode if the rigging stops and the physical market defeats the paper market. But as long as investors are ready to accept mere certificates from bullion banks in place of real metal, and governments, central banks, and their agents are ready to issue paper for infinite amounts of imaginary gold, the market rigging can go on forever.

As with everything else in the world, it's entirely a question of whether people can ever bring themselves to act.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

About the Author

turd [at] tfmetalsreport [dot] com ()

Dec 21, 2016 - 9:21am


Very informative and well-written post. Thanks TF and Chris!

Dec 21, 2016 - 9:46am

Great post.Second!

(Its a lie ,I did not read the post yetcheeky)

Dec 21, 2016 - 10:07am


Thrud....come on Charlie

Dec 21, 2016 - 10:11am

Come On 4th I'm Here

It's about time someone showed up. Now To Start My Day Of Right, then I'll know the downslide will stop and go back up. Keep Stacking

Dr. P. Metals
Dec 21, 2016 - 10:31am

Let's compare

This is your money in a bankster controlled naked-short issuing fraudulent "paper gold" futures derivatives manipulated market (day after day, week after week, month after month, year after year):

This is your money in a non bankster controlled fraudulent market (as of yet):

Any questions?

Dec 21, 2016 - 11:07am


In addition to all the concerns about metals manipulation, here's some hope with the media and it's duty to the public.....

NEARLY wiped out
Dec 21, 2016 - 11:20am

absolutely, excellent post, this should be ......

sent to every producing miner in North America and to every brokerage !!

I have been a mining co investor trying to make a return based on fundamentals in the industry for about 20 years which is pretty much a joke because of this !!

As investors we need to take some sort of action and demand the miners we invest in read & acknowledge and do something about it, ie not selling production to any bullion bank or related subsidiary of the banking cartel etc !

And supporting GATA !!!!, Thank god for Chris Powell for keeping the cause alive,

Great job Chris, Send in a donation People !

Dec 21, 2016 - 11:21am

Pento on Greg Hunter

Interesting interview of Michael Pento.

He's thinking there might be a big sell off in the stock market on the 2nd January 2017.

Michael Pento-Bond Bubble is Epic
Dec 21, 2016 - 11:21am

Merkel Government Still In Denial

The police union in the German state of Thuringia issued an open letter to the state's Interior Minister, describing the crumbling law-and-order situation amid the rising migrant crime: "[You] are abandoning us completely helpless to a superior force... But what changes? Nothing. One instead gets a sense of uninterest." Meanwhile, representatives of Arab community were reported telling the police in Ruhr, "The police will not win a war with us because we are too many."

Dec 21, 2016 - 11:22am


I want to thank TURD for publishing this piece from GATA. We all know who they are and what they have struggled to do over the years. I have just sent a meaningful donation for me to Chris Powell and I urge all the readers here to consider doing the same in this holiday period. In my opinion this is the least we should do for a group who have not only spent years fighting for our cause, but have done it effectively in the sense of getting the word out. Do we yet have a positive outcome, no, but at the very least we all know what the problem is and we should support their efforts. Thanks for your consideration.

J Siefert
Dec 21, 2016 - 11:52am

First sign that Munich Event is a Fake

"Published on Dec 21, 2016

German police are hunting for a Tunisian national whose ID was found in the truck that rammed into a crowded Berlin Christmas market. "

Merkel under pressure after deadly Berlin truck attack

So he forgot his Identity Card and left it in the truck cabin. indecision

James Crighton J Siefert
Dec 21, 2016 - 12:16pm

Siefert - passport - 11:46am post

..... of course it's a plant - no question whatsoever. Assess this in the light of the "passports of the 9/11 hijackers having been found in the rubble of the twin towers (and building 7)" despite steel - yes, effing steel - having been vapourised.

Are we total idiots? Sheeple.


James Crighton
Dec 21, 2016 - 12:22pm

Bitcoin vs Gold - manipulation?

........ the facts speak for themselves - graphically:

Dec 21, 2016 - 12:25pm

Four days until Christmas!

Oh what will the new year bring forth to the world? I was sitting here, at my desk, looking at my old land line phone. It is an old push button phone and it does not work very well. I should have thrown it away long ago. 

Then I was pondering the past. I have called my parents on this phone, my sister, my two nephews, my brother Don, my aunt Lucy, our best of friends Terry & Jerry and even California Carol. We talked to Linda's parents, her two sisters, several cousins along with several aunts and uncles all having departed from this world, all not being here for this Christmas.

The phone line is fairly quite these days, however, the great joy of kids and grandchildren is a wonderful life. When you gather at your holiday events, look to the needs of the baby boomers and spend a minute with those who's land lines have become silent. If you need an old push button phone to make you happy, I will give you mine. We are busy with basketball tournaments with our granddaughter and the joys of a united family life. Jim

Dec 21, 2016 - 12:36pm

BTC to start then......PM's to follow?


So, guess which one of these counterparty & inflation hedge assets can be controlled by Banks & Governments

Dec 21, 2016 - 1:23pm

Bitcoin is PM's Best Friend

IMO, Bitcoin is PM's best friend.

It is difficult to manipulate Bitcoin and it does appear that the asset is ready to take off. The payoff/benefit of manipulating PM's down is reduced as more options for wealth preservation become available such as Bitcoin.

Ultimately, it seems that there will be a logical choice that will be made by the TPTB. These folks probably own vast amounts of Gold/Silver. However, there are some non-PTB who probably own way more as a ratio, of Bitcoin-to-% wealth ownership versus the traditional elite.

The longer they suppress metal prices, the faster they drive Bitcoin price higher due to perceived lack of value in PM's by the wise investor who is not elite. 

It is inevitably in their interest to let off the PM price suppression. Compared to the commoner, they have the Gold/Silver in massive quantities but likely relatively low Bitcoin ownership. If they want to maintain their Elite status and keep commoners out, they must allow PM's to regain their real value.

GATA is important because as the manipulation is revealed, people will turn to other monetary assets such as Bitcoin at a faster rate. This ultimately will motivate the elites to let off the metal suppression because it is in the metals, where they still have control when fiat dies.

*This is an opinion piece. 

Dec 21, 2016 - 1:45pm

What his perspective fails to include

Mining companies are debt funded, far more than shareholder value in most cases. Do you dare bite the hand that feeds you? 

If mining companies didn't have any debt, they would be in a position of power. They could offer dividends to shareholders in the form of gold and silver. Same thing to employees and vendors. This would reduce the influx of new stocks into the system, but that would not make much difference for the gold price. Silver might benefit if recipients refused to sell their earnings in the form of silver (into the market), but rather held the investment. 

I throw a monkey wrench into the fantasy of fixing a broken market, but I feel entitled to do just that because like many of you my portfolio is looking pretty bad right now. That's my own fault for not paying attention to the saying, markets can remain irrational longer than you can stay solvent. 

Here's the punch-line IMO:
We live in a fiat world that has become absolutely irrational (well beyond anything I could have imagined in the last forty years ... since I started accumulating wealth and investing). Every mining company must operate in that fiat world. Their employees, vendors, subcontractors, lending institutions, federal and state governments, and land owners of their leases require payment in Monopoly money backed by the full force of governments that collude to keep the status quo going. 

If you agree with my sentiment, why on Earth would you believe the fantasy that the gold/silver pricing system will be fixed by anything other than a collapse of the status quo?

BTW, I have no idea when the system will fail. However, that failure is overdue in my opinion. 

aomegaa James Crighton
Dec 21, 2016 - 1:45pm

Charlie Hebo Also

That guy left his ID in truck as well! Really!

mavens aomegaa
Dec 21, 2016 - 1:54pm


We oughta figure out how the hell Europe is documenting all these immigrants so damn well. They are all carrying so much fuggin ID on em that it falls out of their pockets at the craziest times and places...

boomer sooner
Dec 21, 2016 - 2:00pm

All markets are controlled.

Yesterday I picked up my half of a beef. 375# for $750. I could not believe my eyes. I was astonished that I could have a steer raised (western Oklahoma grass fed), slaughtered, and processed for $2 a pound. Yes I know the rancher, but not that well. Hamburger, steaks and roasts, vacuum sealed and flash frozen, all I had to do was pick it up and write a modest check.

Someone definitely has their finger on the scale of the beef cattle market.

AIJ Noteriety
Dec 21, 2016 - 2:02pm

Noteriety / RE: Bitcoin

 I agree with you 100%. But that presumes the powers-that-be are logical and rational and won't fight to The Bitter End. Look at how Hillary kept fighting. And I'm sure they're still fighting. I believe the only way they'll give up is when it all collapses underneath them and they have no choice. You see narcissists are never wrong and even when they're proven wrong they continually deny it just look at the Clintons.

Dec 21, 2016 - 2:03pm

Well, I guess that explains something...

Why my Seabridge stink bid got filled a couple of days ago.

I had no idea, honest! It'weren't me!

Dec 21, 2016 - 2:08pm

It's more than a blander

German authorities new that the creep was on their list of potential terrorists. Why they didn't place him in a detention center, while waiting for Tunisian ID document, to proceed with his deportation. Didn't sound like he was hiding anywhere. This young criminal (spent 4 years in jail in Italy, for trying to burn a school) had to be angry and very dangerous to people.

Dec 21, 2016 - 2:15pm


Agreed. But what I am thinking is that allowing metals to realize their real value will satisfy the narcism of TPTB. 

They will say it was their plan the whole time. But if they continue this path, their power will be threatened.

I believe they already know the PMs will be rising in value. They just need to get their timing right so that the intrinsic, psychological and historical value of Gold is not diminished and lost to new, true free market stores of wealth.

Their power/narcism relies on the value of PMs and they will not lose it. PMs will rise and I believe Bitcoin rising in value will hasten that rise.

Dec 21, 2016 - 2:24pm

John Ing on gold and the Trump agenda

Ignore the fact that it is on KWN and give it a read. John Ing is a well connected money manager and has written a very good article.

Dec 21, 2016 - 2:26pm


Because Merkel enforces her delusions of 'diversity' and 'PC' with an iron fist. The bitch is truly bat-sh!t crazy !

If the German people wish to put up with her raving stupidity, then they must endure the outcome of their wishes.


She is convinced that pouring hot tar into skimmed milk makes 'latte' and that it is quite possible to pick up a turd by the clean end.

Dec 21, 2016 - 2:27pm


Perhaps we ought to adjust our stink bids to stinkier and stinkiest.

Dec 21, 2016 - 2:29pm


Excellent article. thanks for posting it Turd.

Attackers leaving their ID cards in trucks on two occasions, and one found in the rubble of 911? ... Hmmm ...

I mean that REALLY makes you go Hmmm...

So when one decides to commit a crime, real pros leave their iID card SOMEWHERE IT WILL BE FOUND and we ought to do likewise? I bet that is NOT what they teach in Criminality 101. And yet, the public buys into this MSM BS.

Sorry, but as I buy gold, which one day may be as bad as these other crimes, I hope to leave no trail.

I am depressed.

Dec 21, 2016 - 2:33pm

Option Activity

Someone also bought 1000 Jan $6c on AG today (Wednesday) - paid approx $130k and bought 1000 contracts of PAAS Jan $13c - paid approx $190k today and another 1000 contracts of PAAS Jan $14's for approx $115k.

Also, 7400 (6200 & 1200) SLW contracts FEB $19's bought on Monday and yesterday respectively for approx $500k.

None of these appear to be hedging PUTS in the same stock - but could be hedging SHORT physical, futures, or other metals positions???

Dec 21, 2016 - 2:34pm


If you dont mind me asking,the hoped for upside to northern shield resources is due to the hopped for imminent discovery of the near surface massive sulfides,feeder or deep subchamber(2000m)?

If the ..holly the subchamber,isnt it a bit deep(2000m)?I am researching this story and took a look at its ceo,ca forum.

(not native english speaker so excuse my english)

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