GATA: U.S. Government Suppressing Gold Price
Source: Seeking Alpha, Mark O'Byrne (5/6/09)
". . .elements in the U.S. government are suppressing the gold price through financial proxies in order to maintain faith in the dollar. . ."
Concerns about the international financial system and their implications for the dollar and other currencies and inflation going forward look likely to see gold remain firm for the foreseeable future. The central bankers and politicians' mantra of "inflate or die" will likely soon lead to the emergence of real inflationary pressures.
Richard Russell, the venerable and highly respected newsletter writer, wrote overnight of how all markets including the gold market appear to be being manipulated at the moment. The government is on record regarding intervening and manipulating the bond market through purchases of their own bonds.
Russell concurs with the Gold Anti-Trust Action Committee (GATA) that elements in the U.S. government are suppressing the gold price through financial proxies in order to maintain faith in the dollar and U.S. government debt. GATA's credibility was recently greatly enhanced when their long held but disparaged assertions that the Chinese Central Bank was accumulating gold were proven correct (the commonly accepted World Gold Council and GFMS gold holding data was proved incorrect).
GATA is meeting press in London this week and should their contentions receive a fair hearing in the media it could have material impact on the price.
Besides the strong fundamentals, technically gold is looking better and better with a bullish reverse head and shoulders formation being traced out that would suggest gold's lows have been reached. A close above $1,010/oz would be very bullish but first a close above $967/oz is necessary.