TFMR Podcast #14 - Ned Naylor-Leyland Discusses PAGE, Silver and True Price Discovery


“You never change things by fighting the existing reality.
To change something, build a new model that makes the existing model obsolete.”

― Richard Buckminster Fuller

Please stop what you're doing and listen to this extremely important interview with Ned Naylor-Leyland of Cheviot Asset Management in London.

Many have wondered what happened to the Pan Asia Gold Exchange. We were all excited last summer when we first heard about it but, then, things went eerily quiet. Today, Ned Naylor-Leyland and Andrew Maguire are finally able to go public with an update on PAGE and, more importantly, information on a brand new exchange that will soon begin trading a spot, physical silver contract.

Please do three things for me:

  1. Listen to this entire podcast.
  2. Read the research note below that Ned published today for Cheviot clients.
  3. Listen to Andy Maguire's interview with Eric King. It can be found here:

Today is an historic day in the effort to dislodge the imperial forces that dominate the leveraged, paper markets of gold and silver. We must to grateful to Ned, Andy and all those involved in making this new silver exchange a reality. Ned promises to keep us posted with more details as the launch of the exchange draws near. For now, be comfortable in knowing that we have powerful allies who are intent upon making obsolete the existing model and will soon put forth a new structure, one that finally allows for true price discovery in the precious metals.


P.A.G.E. Squashed: And now for something completely different...


Ned Naylor-Leyland, Cheviot Asset Management

Last year at the GATA Goldrush 2011 conference I presented about the Pan Asia Gold Exchange (PAGE) and the likelihood of the ‘Spot Dog’ shaking off its ‘futures handlers’. This was to happen thanks to this new game-changing Chinese Exchange driving a return to a more acceptable form of price discovery. Much water has passed under the bridge since the ‘soft’ opening of PAGE in the early summer of last year, and everyone is well overdue an update. Meanwhile,thanks in no small measure to the debacle at MFGlobal, the spot dog has indeed thrown off its handlers (hence the emergence of backwardation in Silver) – but, as can be inferred from the title above, PAGE has also been squashed, Monty Python-style.

Fortunately, however, this is far from the full story, as the players behind the 1:1 allocated market concept are determined to make it run come hell and/or high water. The market is begging for this return to real price discovery and in spite of the interference so far, the change IS coming. It is disappointing to have to report that PAGE has not rolled out the way we anticipated, however everything that I presented at the GATA Goldrush conference was accurate at the time. The fact that a major Chinese regional development program was stalled appears, at least in part, to have been due to the publicity generated by Andrew Maguire and I. Too much is very evidently at stake in the world of Ponzi Bullion banking for the status quo not to fight its corner. Soon after the noise was made about PAGE and its forthcoming 1:1 allocated Gold contract, the shenanigans started. Just after the publicized ‘soft launch’ (with Central government mandarins in attendance) and the noise made on the internet about its implications, the one shareholder in PAGE that had a foreign listing (in the US) suddenly and stealthily increased its share-holding from 10% to 25%, acquiring additional board directors along the way. The rationale for this sudden change in the weighting of shareholders is shrouded in mystery, however what we do know is that this entity then insisted that they be allowed to build the trading platforms for PAGE from the ground up, rather than buying a working platform off the shelf to get PAGE operational in a timely manner.

This blocking tactic at board level effectively stopped the progress of the fully-allocated spot contract in its tracks, and it was immediately clear to the international-facing people that something fundamental had changed internally. Interestingly, the key Independent Director of this small listed entity that blocked the timely roll-out of PAGE is a well-known Western banker within China, whose CV includes work for the Federal Trade Commission, the Sloan Foundation (related to MIT) and his wife is a member of the Council on Foreign Relations. Whether this intervention respect of the platform was nefarious or not, it was understandable that the people behind the international-facing fully-allocated contract decided to step aside from PAGE and set up their own dedicated exchange. More on that in a moment. Following on from this removal of the 1:1 international contract, the domestic and leveraged PAGE Gold contract (via the Agricultural Bank) also subsequently went the way of the dodo, thanks to the well- publicized People’s Bank of China (PBoC) announcement about control over domestic Gold trading outside of Shanghai. It appears that the shiny Gold building constructed in Kunming City for PAGE will sadly remain (as elsewhere in China) a ‘see- through’, at least until the new Communist Party Politburo are voted in and the new political culture is embedded later this year when who knows, the rules on Gold trading again may be relaxed. Ostensibly these new PBoC rules about Gold trading were brought in to ‘protect the public’, but it is interesting to me that such a U-turn in policy appears to have been driven by pressure exerted somewhere within the People’s Bank, rather than it being typically characteristic of the long-term planning of the Chinese.

As disappointing as this all appears, there is a very substantial Silver lining to what has happened, both respect of the international allocated contracts and the indeed the domestic leveraged ones. By freeing themselves of the other shareholders within PAGE, the international-facing contracts are now being developed independently and under a new name. After the shenanigans of last year Andrew and I will not be giving the name of this new exchange until it is properly ‘live’ in a few months time, as it seems obvious that too much is at stake within the existing Bullion Banking system for this to be allowed to launch without some attempt at interference.

The aforementioned change in domestic Chinese rules mean that along with every other regional Precious Metals exchange, the new unnamed 1:1 allocated exchange is launching with Silver initially, which of course is the Achilles Heel of the Bullion banking system. This in my opinion is far more bullish and exciting short and medium-term than the Gold contract would have been, as the physical Silver market is so tight. Furthermore, all the regional exchanges mothballed by the PBoC rule change can switch, and are switching to Silver trading which is not covered by the change in rules. The contract itself will be, as before, an international rolling 90 day spot one, denominated in RMB, and the new entity is supported by the same serious players within the Chinese political and military establishment as before. The physical will be acquired ahead of closing each monthly tranche and will be vaulted entirely outside of the Bullion Banks (i.e. private vaulting facilities). From there the allocated receipts will be recorded on an electronic register and the issue will be tradeable in the secondary market with the register adjusted real-time. This is extremely good news for holders of real Silver and extremely bad news for holders of fake paper Silver who rely on the 350:1 leverage being maintained as the world’s sole price discovery mechanism for large purchases of the white metal. This effectively will be like dealing in an RMB-denominated and fully allocated version of some of the popular Silver Bullion Trusts, but rather than trading at a premium, the premium will price the issue ahead of purchase, affecting global price discovery, as previously mooted.

The guts of this new exchange that is rising Phoenix-like from the ashes of PAGE, are agreed and under construction. The international conduit for the new exchange has also been established and is ready to receive business once the legal framework (well down the road) is given final sign off by their Chinese legal team. Unlike PAGE, which was primarily established by domestic Chinese interests, the new entity is much more streamlined, better funded and the problems encountered last year by PAGE have helped to clarify the route going forwards. All in all, the squashing of the Pan Asia Gold Exchange has in truth only served to accelerate the move to real price discovery, and the control over domestic Gold trading is in my opinion yet another reason to be bullish about the prospects for the Silver price. Once the new exchange is ‘live’ in the summer we will be back with the all- important details about where and how to gain access for those interested in buying physical in size rather than paper illusions. Many serious physical Silver buyers, who are desperate to leave the farce of the Loco London system are ready to jump ship once the final sign off takes place.

Ned Naylor-Leyland
February 2012


Mar 3, 2012 - 11:40am

Seems relevant to the conversation...

Yuan cross-border settlement extended

Move part of strategy to promote internationalization of the currency

BEIJING - The People's Bank of China on Friday again expanded the yuan-denominated cross-border trade settlement scheme, in a move that will further promote the use of the Chinese currency in foreign trade and its rise as a global currency.

After the expansion, all enterprises with an import-and-export license will be allowed to settle their foreign trade in yuan. Previously, only selected businesses were allowed to do this.

Yuan cross-border settlement extended

Yuan notes being counted at a bank in Qionghai, Hainan province. The Chinese central bank says all enterprises with an import-and-export license can settle their foreign trade in yuan if they so desire. Previously, only selected businesses were allowed to do this. [Photo/China Daily]

The move is designed to "meet market demand and make foreign trade freer and more convenient", the central bank said in a statement posted on its website.

Yuan-denominated trade settlement quickly ballooned after it was first launched in July 2009. By the end of 2011, the volume of trade settlement in the Chinese currency under the current account hit 2.58 trillion yuan ($410 billion)...

Nick Elway
Mar 3, 2012 - 11:42am

US Nickel composition 75% copper

From coinflation. The composition hasn't changed since 1946. I stack nickels.

current melt value is USD .056, 23 pounds per box of $100, awkward to steal.

Denomination: $0.05
Obverse Image: Thomas Jefferson, 3rd President of the United States and author of the Declaration of Independence.
Reverse Image: 1946-2004, 2006-2007: Monticello, Jefferson's mountaintop home in Virgina.
2005: Westward Journey Series including "American Bison" and "Ocean in view! O! The joy!".
Metal Composition: 75% copper, 25% nickel
Total Weight: 5.00 grams
Comments: The 1938 through 1942 D versions of the nickel are also made of the same composition, but generally are sold for a premium over their melt value due to rarity.
Mar 3, 2012 - 11:42am

@Fred Hayek

Nice response on the above points. I tend to remain skeptical after getting hopes up and let down on so many things, but that does not mean that I would not want the new exchange to happen or believe that it could. Theoretically, if all the members of Turdville were millionaires and billionaires and wanted to create such a thing, we could try. Of course there would be opposition but TPTB do not control the entire world, much to their dismay. Like the Mafia, they may seem omnipresent if you are from New Jersey, but I doubt they have too much influence in North Dakota. You can get away from their reach just like TPTB, although you had better have your shit together before you try as you will get noticed. But if your legal documents are in order and you are doing everything "by the book", then it will be hard to stop you from doing something that is legal to do. Look at Eric Sprott. He is buying incredible amounts of silver even though "they" don't want him to. But he is doing it much to their dismay.

I think the other point I'd like to make it this: Maybe it is a long shot. Maybe it's like the Cleveland Browns winning the Super Bowl next year. It's unlikely but it COULD happen. If a group of people believe and execute, great things can happen. A lot of "impossible" things have happened all throughout history.

And in this case, if it did get pulled off, it would mean greater freedom for individuals and nations. Wouldn't you want to root for it and support it? I know I do, it would mean an eventually better and more fair world for my children and grandchildren. I vote for Ron Paul and I donate money to his campaign because I believe in supporting him. People tell me I'm crazy because "he'll never win" or "they would never let him in". Maybe. But is that any reason to not support what is right?

I'd rather die fighting than give up my soul so that I could say that "I was right. I picked the winning team"...

Mar 3, 2012 - 11:48am

calm before the storm

doppler radar shows a really ugly stripe of weather running across the florida panhandle. i'm just ahead of the leading edge now. the good news is that i just planted a bunch of things that will benefit from a good soaking. the bad news is that there be TORNADOES embedded in that band of storm. stay safe, stay dry, peeps.

around here we're used to the idea of prepping. from time to time, storms knock the grid down, and we go without power for days. good practice.

Mar 3, 2012 - 11:51am

@Fred Hayek

Great rebuttal to a somewhat "mean spirited" post - one that seemed to imply we should "give-up" and not waste our time.

We should never, never give up. Thank-you.

Mar 3, 2012 - 11:56am

For Fred

I thought I smelled some singed hair from your last postyes Excellent!

Mar 3, 2012 - 11:59am

Fred- you may want to hop in the pool

... 'cause you're on fire. Respect to you, sir. Nihilism is for sissies.

Mar 3, 2012 - 12:03pm

Canadian Nickels

@Island Guy

Canadian Nickels aren't what they used to be either. The latest iteration, from 2000 to present are composed of: 94.5% steel, 3.5% copper, 2% nickel plating. (Not much of value there, anymore).

Wikipedia Re Canadian Nickel

Mar 3, 2012 - 12:10pm


excellent work sir

R man J
Mar 3, 2012 - 12:28pm

Thank you Fred


As Eric King said on his interview with Egon VonGreyerz today, "This is a game of psychological warfare." Emotions can be so powerful. That is why we need a plan---before the manipulation happens.

Consistent planned physical purchases are a result of preparation with no regard to emotions.

All in!

Mar 3, 2012 - 12:37pm


There's way too much emotion here in this blog.

We used to have guys here who were steady hands.

The people posting in the last few days sound very emotional in their trading positions.

Very odd indeed and it may be rather bullish for the next week.

Mar 3, 2012 - 12:45pm

Introducing the LME

The London Metal Exchange - Introducing the LME
Mar 3, 2012 - 1:05pm

Great Podcast Turd

Let's hope this new Silver exchange withstands the EE attack, which we know will inevitably happen.

Turd, I hope you will let me post this personal note to everyone in Turdland. I will be visiting Auckland, NZ in a couple weeks with the intentions of moving there one day and starting a business. Are there any Kiwi Turdites here that can assist me in meeting some relevant folks there? You can send me a personal message by clicking my name.

One interesting item that I discovered recently from a bullion dealer from NZ was that while there is a GST on Silver Eagles ,there is none in Silver Maples because it is .9999. Is that true?

Mar 3, 2012 - 1:20pm

Mar 3, 2012 - 1:21pm

This is really god stuff

Do you recall the time and energy we spent discussing the 10-year note and the Long Bond back in January? As a reminder, here's a sample:

Trader Dan "parks it in the cheap seats" with this one. He is spot on. Remember, declining bond prices = higher interest rates. Higher rates cannot be allowed as high rates accelerate the demise of The Great Ponzi. We must watch the 10-year note and the Long Bond for clues as to the initiation of overt QE3.

C1 cris
Mar 3, 2012 - 1:39pm

Standing for Delivery

That's a good move, but timing is everything. You need to consider the Fuller quote from above. Don't tear down the house until you have someplace else to live. C1

atarangi meegoreng1
Mar 3, 2012 - 1:42pm


Silver and gold purchases in N.Z. do not attract g.s.t. It is not difficult to buy and sell here.

Fred Hayek
Mar 3, 2012 - 1:45pm

Every fix is just for today

Dan's logic is very strong. And it shows how short term the perspective for each successive fix is.

"Don't let things fall apart, today!"

"But, sir? If we do this, then it'll make things much harder tomorrow!"

"We'll worry about that when we get there!"

Having the ISDA say that a default is not really a default and that your CDS's purchased to insure your bonds are worthless has to make bonds less desirable to hold and the necessary yield go up. Doesn't it? But that then requires more QE, doesn't it? But that next bit of heroin won't feel quite as good as the last dose. And it pushes the junkie closer and closer to a crackup or overdose.

Mar 3, 2012 - 2:33pm

abbot and costello reborn!

World Collapse Explained in 3 Minutes
Strongsidejedi TF
Mar 3, 2012 - 2:44pm

@TF - Re: POSX and Ag & Au prices


That last comment is more in alignment with my take on the last 72 hours of trading.
The situation on Wednesday just made me consider longer positions at that point.

It was apparent that some group was selling paper hard.

But, the situation in the local coin shops was basically clear. There wasn't alot of good 1 oz coins being sold. In fact one store had ONE 1oz Amer Gold Eagle and Nothing else. It's a big store!

With the amount of selling that was done, there should have been a much greater longer term chart impact. I'm not impressed with the chart impact. We saw indications on this board from other people on Tuesday who were seeing flash crashes in the pricing. That may have been a preview attempt (dry run) by the algo's.

This paper market is NOT human driven. It's clearly driven by algo's who are making split second position adjustments.

This algo trading has disrupted and caused a departure of "reality" from the virtuality of the digital market.

This is probably the reason that COMEX prices can move sideways while the USD gets printed to oblivion.

Mar 3, 2012 - 3:00pm

Need some technical help

I know one of you talented Turdites can help with this. I'm no chart guy and doing any overlaying of charts and getting them on here is beyond me...for now.

So this is what I'm after. I have the link below to MW and I've been watching the 10 yr UST for awhile and I saw some funny things lately compared to other times relative to whatever parameter I'm watching at any given time. TF noted more then a week ago something seemed off (new paradigm) and I was thinking it also but didn't know yet what I was watching. It might have been the 10 yr. moving around quite a bit within it's range.

I'll stick to oil and the 10 yr UST for now. I think what it might show is some correlation to what happened (or maybe just the reaction from) the gold takedown Weds. I'm not sure. Note the divergence in the 5 day and where it takes place and when.

It also seems to show a correlation in the divergence at the end of Dec. 2011 when the market started trending upwards noticeably.

Intervention? Maybe. Coincidence? Maybe. But I'm leaning towards stealth intervention.

I don't know if this proceeded what happened in gold Weds. or if this is just the reaction from it. It seems previous to it. I'm not sure and that's where I need another set of eye's along with a chart to display here if possible.

Here's the link...

add the following 10_YEAR to the small window where it says ADD above the chart and that's the overlay I'd like to see displayed on here if possible.

Throw in GLD and watch what happens when crude and 10 yr UST show the divergence in the 5 day chart.


Mar 3, 2012 - 3:00pm

max humiddidy

that band of weather has arrived. puts me in mind of that metaphor with the cow and the flat rock. the dogs on the porch look eight-lorn. that's like forlorn, but there are two of them!

Mar 3, 2012 - 3:02pm


Good post Fred

I've seen NED on the Kaiser Reports a few times. He's always evasive and non-committal. His new exchanges are obviously bogus. He is in the traditional "Pump and Dump" PM game playing the paper markets.

The transition to physical silver will take a couple of years and happen slowly on the street as the public, retailers, local and State governments start having problems with the USD and imports. Importers may soon stop accepting the USD or give better price breaks for payment in PM's. Utah, Colorado and 13 other States are already in the process of making Silver and Gold legal tender.

I think TURD should be concerned about keeping the good CRED of this blog and do little more due diligence before featuring the NED Naylor's and their "Once Upon A Time" stories. Just my take.

Loooooooooooooong and enjoying the ride

Mar 3, 2012 - 3:05pm
Mar 3, 2012 - 3:18pm


is giving free market leeway while giving evidence of market control. Is there any amount of 10yr they cannot buy?- like they are/and have? They already showed the bond traders who sets the "dials" we watch. Money printing and lies can really distort things we look at-as was his case with Wed. gold.

Moderator Holliday
Mar 3, 2012 - 3:18pm


Your take on Ned Naylor and TF was duly noted by myself. Attacks and questions of character about our host and his guests will not happen while I'm on duty.

Which is why I unpublished the comment due to it's attacking style and your questioning of the integrity of TF and his guest, Mr. Ned Naylor.


"Doc" prefers to keep his virtual "Peacemaker" out of sight and holstered.

Mar 3, 2012 - 3:19pm


I've gotten to know Ned pretty well. He is not in the "traditional pump and dump PM game". He mainly follows miners and does very little paper metal trading. You're welcome on this blog but please try not to disparage those who are doing all of the heavy lifting and boldly putting their faces, their livelihood and their reputations on the line in the public arena for your benefit.

Mar 3, 2012 - 3:21pm

Mod Holliday

As you were doing that, you'll notice that I re-published Tricky's remark with my reply listed above.

Thanks for all you do!

Mar 3, 2012 - 3:23pm

Just went back an re-watched this

You might want to watch this again. The only thing missing is that the EE clearly chose "option #1". It would seem that they are trying to do both options at the same time, actually. Perhaps The Witch will make another appearance soon.

The Wicked Witch Schemes For 2012
Moderator Holliday
Mar 3, 2012 - 3:26pm

No problem

Understood and thanks yes


"Doc" prefers to keep his virtual "Peacemaker" out of sight and holstered.

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