London Gold Pool II On The Verge Of Collapse As Panic Nears
With
the war in gold continuing to rage, today one of the most respected
veterans in the gold world told King World News that the Western central
bank cartel which has been capping the gold price for more than a
decade is nearing the point of collapse as panicked phone calls are now
being made to acquire sizable amount of gold.
November 24, 2014
James Turk:
“The battle for $1,200 gold is really heating up, Eric. The shorts have
drawn a line in the sand, and the efforts they are making to cap the
gold price is obvious....
Continue reading the James Turk interview below...
Advertisement
UPDATE: To hear which company just made one of the most exciting high grade
discoveries that just had a massive 101 meter drill strike, as well as
major financial backers click on the logo:
“First,
there are the hedge funds and specs that are short the gold price. They
want to exit their positions with as much profit as possible. So they
are defending their short positions with even more shorting in the hope
of getting lower prices, which partly explains why Comex open interest
has been rising even as the gold price has risen the last few weeks.
But
those still short are probably kicking themselves that they didn’t cover
when gold was $60 lower. Then there are the central planners who are
short and fighting the rise in the gold price by selling ever more
promises to pay gold in the future. But interestingly, Eric, there are
central planners on the other side too. These are the central banks and
other government entities that have bought paper gold in anticipation of
taking physical delivery. There are also some institutional buyers in
this group.
But
regardless whether they are in the public or private sector, they are
riding in the same boat. All they hold are paper promises to receive
physical metal. And now this group is starting to become aggressive in
taking delivery. They don’t want cash settlement -- they want physical
metal.
There
is an effort underway by this group to get their hands on physical
metal before year-end. In this way these institutions can state in
their December 31st accounts when they prepare their annual report that
they own physical metal and not just some paper promise.
It
looks to me that the demands for physical delivery by this group are
going to set the stage for higher gold prices as we move toward
year-end. Only higher prices can end the limited availability of
physical metal prevailing with gold under $1,200.
The
miners cannot ramp up production of physical metal overnight. The metal
needed to bring supply and demand back into balance and eliminate the
backwardation can come only from above-ground stocks. Importantly, after
a three-year price correction, this metal is in strong hands. These
owners of physical metal will need a much higher price to entice them to
sell their metal and hold some national currency instead.
There
is an exception of course to the strong hands who own the above-ground
stock. These are the central planners who continue to empty central bank
vaults in a vain attempt to fight reality. Although they occasionally
win a battle or two, they are losing the war.
These
central planners won a small skirmish today, Eric, by keeping the gold
price under $1,200 for the Comex options expiry. These guys along with
their bullion bank agents are playing their usual games at month-end
option expiry. This price capping may remain a bit longer because there
are still the over-the-counter options here in London and elsewhere to
expire over the next couple of days.
The
bullion banks that sold $1,200 calls will do everything in their power
for those options to expire this week out of the money. But every
reaction has an opposite reaction, and we are clearly seeing the recoil
here in London.
Even
though the gold price has risen over $60 since the $1,130 low was
reached earlier this month, not only has the backwardation persisted, it
has actually become deeper and extends out a full six months to levels I
have never seen before. We are in uncharted territory.
The
institutions converting their paper gold into physical gold are strong
hands and not sensitive to the rising price. They locked in the delivery
price when they purchased their paper contract and they are holding the
bullion bankers’ feet to the fire to demand delivery even though there
is not enough metal around to deliver.
But
instead of the gold price rising to correct this imbalance,
central-planner price capping has caused the backwardation to deepen.
The central planners are also causing some frantic phone calls trying to
locate sizable amounts of physical metal. The situation is on the edge
of becoming panicky.
There
is only one conclusion to take from this exceptional situation. We are
witnessing a history-making event, and where it will lead is clear to
me. This cartel run by central planners for more than decade to cap the
gold price will collapse, just as their cartel called the London Gold
Pool collapsed in March 1968 after nearly a decade of trying to keep
gold at $35 per ounce. And while it is impossible to predict when this
collapse will occur, the writing is on the wall.
Given
today's unique circumstances of the deep backwardation and the extreme
tightness of physical metal, December 2014 has the potential to go down
in the history books alongside the March 1968 unleashing of the gold
price that marked the beginning of the great gold bull market of the
1970s.”
© 2014 by King World News®.
All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page
is permitted and encouraged.
UPDATE - KWN has many more interviews being released today.
The audio interviews with
Ben Davies, Greyerz-Stamm-Turk, Gerald Celente, David Stockman, William
Kaye, Dr. Paul Craig Roberts, Andrew Maguire, Eric Sprott, Bill
Fleckenstein, Rick Santelli, John Mauldin, and Marc Faber are available now. Other recent KWN interviews include Jim Grant and Felix Zulauf -- to listen CLICK HERE.
Eric King
No comments:
Post a Comment