Bank for International Settlements confesses to gold price suppression scheme

1:28a ET Thursday, March 9, 2006

Dear Friend of GATA and Gold:

Alan Greenspan confessed to the gold price suppression
scheme while he was chairman of the Federal Reserve.
He gave his famous testimony to Congress on July 24,
1998: "Central banks stand ready to lease gold in
increasing quantities should the price rise."



The European Central Bank confessed to the gold price
suppression scheme when it entered the Washington
Agreement on Gold on September 26, 1999. The bank's
members acknowledged that they had gotten together
to regulate the gold price through gold sales and
leasing:



Barrick Gold confessed to the gold price suppression
scheme in U.S. District Court in New Orleans on
February 28, 2003, when it filed a motion to dismiss
Blanchard & Co.'s anti-trust lawsuit charging that
Barrick was doing exactly what its motion admitted.
The motion said that in borrowing gold from central
banks and selling it, Barrick had become the agent
of the central banks in the gold market, and, as the
agent of the central banks, shared their sovereign
immunity and thus could not be sued:



The Reserve Bank of Australia confessed to the gold
price suppression scheme in its annual report for
2003. "Foreign currency reserve assets and gold,"
the RBA's report said, "are held primarily to support
intervention in the foreign exchange market. In
investing these assets, priority is therefore given to
liquidity and security, in order to ensure that the
assets are always available for their intended policy
purposes."


df/operations_financial_markets.pdf

And now the Bank for International Settlements, the
central bank of the central banks, has confessed to
the gold price suppression scheme.

The confession of the BIS came last June in a fairly
candid speech by the head of the bank's monetary
and economic department, William R. White, to
central bankers and academics gathered at the BIS'
fourth annual conference, held in Basel, Switzerland.
The speech was provided to GATA this week.

White's speech was titled "Past and Future of Central
Bank Cooperation" and he said in part:

"The intermediate objectives of central bank cooperation
are more varied.

"First, better joint decisions, in the relatively rare
circumstances where such coordinated action is called
for.

"Second, a clear understanding of the policy issues as
they affect central banks. Hopefully this would reflect
common beliefs, but even a clear understanding of
differences of views can sometimes be useful.

"Third, the development of robust and effective networks
of contacts.

"Fourth, the efficient international dissemination of both
ideas and information that can improve national policy
making.

"And last, the provision of international credits and joint
efforts to influence asset prices (especially gold and
foreign exchange) in circumstances where this might be
thought useful."

That is, central banks collaborate -- and since they do
so in secret, it may be said that they conspire -- to rig
the gold and currency markets.

To use White's word, the central banks collaborate
"especially" to rig the gold and currency markets.

Thankfully White did not accuse those who read his
speech of being "conspiracy nuts." We still have
Dennis Gartman, Tim Wood, and a few others for
that, even if their band is rapidly diminishing.

Interestingly, among those listed as having attended
the BIS conference on central bank cooperation and
presumably in the audience for White's speech was
Edwin M. Truman, a senior fellow at the Institute for
International Economics and a former Federal
Reserve official who, as assistant secretary of the
U.S. Treasury Department, kept a close eye on
the delegation GATA sent to visit members of
Congress in Washington in May 2000 and who
was in charge of denying to everyone then that
the U.S. government had anything to do with a
scheme to suppress the gold price. Truman
seems to have survived any shock that White's
speech may have caused him:



White's speech confessing to the gold price
suppression scheme on behalf of the BIS is
appended. You can find the entire proceedings
of the BIS conference at the Internet link
included in the speech. It looks like the bankers
had a much nicer time of it than the people who
try to make their living wresting real money from
the earth.