Tuesday, June 19, 2012

Conspiracy Theories - Gold and Silver

If you want to get some people in the gold and silver community real upset, you question the gold and silver manipulation theories.

So here goes, the follow on from yesterday.

Those holding conspiracy theories are usually distinguished by a  few similar traits.

Firstly, there are those who spruik a few facts, that suit their purposes, in order to suck people into their worldview in order to further their business interests. In other words they deliberately deceive. Now there's not too many like this, I hope.

Then there are those who have a few facts that suit their story and decisions and truly believe the theories they are hearing and repeating. All the facts seem to lead to one conclusion. There is no telling them otherwise. Perhaps this is a pride issue?

Then there are those who just believe the juicy stories and follow the latest theories because they aren't too well educated and don't have the skills to think. Sometimes they feel kinda safe with these unhealthy ideas?

I believe critical thinking skills are essential for life. A dose of skepticism is always healthy.

So what of the silver/gold manipulation theorists? Which camp do they fall into?

The short answer, I don't know yet. I haven't had enough hard evidence to convince me either way in this argument. But in saying that, there is very little evidence to suggest manipulation.

You see, the argument goes like this. The COMEX, the chief place where commodities are traded worldwide, are in collusion with some big banks (like JP Morgan), the CFTC and the Treasury in the US to control the prices of the monetary metals, gold and silver. There is collusion to the point of price fixing to keep the public from realising that the fiat money system is not 'real' and that if gold and silver ever rose to the prices they should be, then the system would collapse.

One of the best known believers in this is Ted Butler. Now he's done more research into this than anyone on the planet. He even has a paid membership following his every tome on the subject. Here is his latest communication on this:

"I'm disclosing for the first time that the U.S. government has given JPMorgan the green light to manipulate the silver market -Ted Butler

Now this is a great piece and well written. But unfortunately lacks any evidence. He points to charts and attempts to join dots about relationships within JP Morgan and government agencies. But no facts, no people on the inside, coming out to verify any of this.

Now I cannot accuse Ted of laziness, but with some people there is a degree of laziness in not trying to get the right data and make the most sensible conclusions? They continue to get stuck in their wordview on this matter.

I mean, there are other just as learned men, like Martin Armstrong and Jeff Christian, who deny these theories and exlpain very well that this is just how the COMEX and markets work. It is normal.

And here's another, Ed Steer, a popular letter writer, who incidently writes for Doug Casey, a fervent detracter of the gold/silver manipulation theories. At least in Casey Research they have a lively debate on this. Here's a typical statement from Ed Steer:

"And there wasn't a shred of news that would have caused that [drop in mining share price]. A more blatant in-your-face market intervention can scarcely be imagined. The executives and boards of directors of all the silver companies that you own shares in will do what they usually do as they and their shareholders get raped...absolutely nothing. Not a single voice will be raised in our defense. The CME and the CFTC will do nothing as well. One has to wonder what sort of evidence the CFTC is looking for in this almost four year old silver manipulation investigation."

Then there are those like Turd Ferguson and Andy Hoffman. Look out if you ever disagree with this theory on their sites.

So these people look at the charts and have some anecdotal evidence and see 'obvious' signs of this manipulation. But there doesn't appear to be much hard evidence from insiders. It's a bit like the 911 conspiracies. You have all these 'facts' floating around and the conspiracists join the dots that may form a credible trail that leads to government involvement. But really it's all shadows and conjecture. Anyway, with 911, you would think a conspiracy on this scale would have an insider or two leak information by now.

The same with the silver/gold manipulation theories. Yes, Andrew Maguire, through GATA, showed the CFTC hearing some time ago, how one manipulation would occur before it happened. But one occurrence a fact, or credible argument, does not make.

So, for me, there is just not enough data to support such theories. Yes, dots can be joined if you really want them too, but other explanations may be just as plausible

However, in saying all this, if there is more hard evidence, then great. But as David Morgan often says, you cannot manipulate forever. The advice is as always; put a reasonable amount of your wealth into gold and silver and be content that your wealth is preserved whilst this financial system resets.

Gold in New Zealand dollars: $2056.18 per oz
Previous all-time high: $2311.02 per oz (15 Nov, 2011)

Silver in New Zealand dollars: $36.28 per oz
Previous all-time high: $59.19
per oz (30 Apr, 2011)

The Anglo-Far East Company
AFE is the gold bullion custodial provider of choice for the sophisticated investor,
families, and institutions that require the highest level of discretion, competence,
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Your reference: an-001

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