by Jon Lindau, Silver Trade:
TO THE DEALERS’ EXPECTATIONS, WILL BE THE FORMATION OF A SIZABLE GOLD FUTURES MARKET. EACH OF THE DEALERS EXPRESSED THE BELIEF THAT THE FUTURES MARKET WOULD BE OF SIGNIFICANT PROPORTION & PHYSICAL TRADING WOULD BE MINISCULE BY COMPARISON.
ALSO EXPRESSED WAS THE EXPECTATION THAT LARGE VOLUME FUTURES DEALING WOULD CREATE A HIGHLY VOLATILE MARKET.
IN TURN, THE VOLATILE PRICE MOVEMENTS WOULD DIMINISH THE INITIAL DEMAND FOR PHYSICAL HOLDING & MOST LIKELY NEGATE LONG-TERM HOARDING BY U.S. CITIZENS…
TRUTH LIVES on at https://sgtreport.tv/
SOME FEAR, HOWEVER, THAT SHOULD A SINGLE BID FOR THE ENTIRE 2 MILLION OUNCES BE FORTHCOMING, PRICES MIGHT INCREASE RAPIDLY, POSSIBLY AS HIGH AS $250 AN OUNCE.
Yet another whacky “conspiracy theory” has now been confirmed.
We wonder why the US Treasury would want to suppress gold prices…
Full Wikileaks Text of the December 10, 1974 Diplomatic Cable below:
BEGIN SUMMARY:
THE ANNOUNCED AUCTION OF OFFICIAL GOLD BY THE U.S. TREASURY WAS PRAISED BY LONDON GOLD DEALERS AS BEING TIMELY AND HIGHLY CONTRIBUTORY TO A MORE STABLE MAR- KET. SOME FEAR, HOWEVER, THAT SHOULD A SINGLE BID FOR THE ENTIRE 2 MILLION OUNCES BE FORTHCOMING, PRICES MIGHT INCREASE RAPIDLY, POSSIBLY AS HIGH AS $250 AN OUNCE.THEY ANTICIPATE MAJOR IMPACT OF U.S. OWNERSHIP WILL BE THE FORMATION OF A SIZABLE GOLD FUTURES MARKET, BUT RATHER SMALL DEMAND FOR PHYSICAL HOLDING OF GOLD, OTHER THAN COINS, AFTER A BRIEF INITIAL SURGE FOLLOWING DEREGULATION.END SUMMARY1. IN CONNECTION WITH VISIT OF GAO TEAM SURVEYING ATTITUDE LIMITED OFFICIAL USE LIMITED OFFICIAL USE PAGE 02 LONDON 16154 01 OF 02 101915Z IN LONDON TO PRIVATE OWNERSHIP OF GOLD BY AMERICANS, ASST- FINATT OBTAINED REACTIONS FROM MAJOR LONDON WHOLESALE GOLD DEALERS (SAMUEL MONTAGU & CO., SHARPS PIXLEY & CO., LTD., MOCATTA & GOLDSMID, AND CONSOLIDATED GOLD FIELDS, LTD.) TO ANNOUNCED AUCTION OF GOLD BY U.S. TREASURY.WHILE THE UNDERLYING REASONS DIFFERED, THE CONSENSUS OF THE DEALERS WAS THAT THE MOVE BY THE U.S. WAS LAUDABLE; IN MOST CASES THEY STATED THAT THE ACTION WAS UNEXPECTED; THE TIMING OF THE DECISION WAS PRAISED AS BEING FORESIGHTED. ANNOUNCE- MENT OF THE SALE PRIOR TO THE JANUARY 1, 1975, DATE WAS VIEWED AS TIMELY SINCE THERE IS MOUNTING EVIDENCE THAT MUCH OF THE RECENT INCREASE IN THE PRICE OF TRADED GOLD HAS RESULTED FROM ANTICIPATION OF A LARGE AMERICAN DEMAND FOLLOWING THE DEREGULATION DATE, EVEN THOUGH THE DEALERS THEMSELVES EXPECT THE PHYSICAL DEMAND TO BE RATHER SHORT- LIVED.2. THIS MUCH SAID, A RECURRING COMMENT BOTH IN CONVERSA- TIONS WITH THE GOLD DEALERS AS WELL AS IN NUMEROUS TELE- PHONE CALLS RECEIVED BY THE EMBASSY IS THAT IF ONE BUYER, OR MORE LIKELY ONE BUYER FROM A PARTICULAR COUNTRY (KUWAIT WAS OFTEN CITED), DECIDES TO PLACE A BID FOR THE ENTIRE 2 MILLION OUNCES OF U.S. GOLD BEING AUCTIONED EITHER AT MAR- KET PRICES, OR POSSIBLY AT HIGHER THAN MARKET PRICES, THEN THE EFFECT OF THE U.S. AUCTION, WHICH IS INITIALLY VIEWED AS HAVING A STABILIZING FORCE ON MARKET PRICES, WOULD BE THE OPPOSITE.
