This is a HTML version of GATA's "ROLLCALL"ad published in Washington D.C. on May 15, 2000. GoldWorld.Net has added the "Email Addresses, Phone Numbers, & Website's" of the people listed in this document.
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Washington D.C. GATA Rollcall Ad /PDF Format
AN OPEN LETTER TO SENATE AND HOUSE BANKING COMMITTEE MEMBERS
Annual gold demand, currently at record levels, exceeds mine and scrap gold supply by more than 1,500 tonnes. In the Washington Agreement of Sept. 26, 1999, 15 European central banks announced that they were capping their lending of gold and would limit their official sales of gold to 400 tonnes per year for the next five years. Some major gold producers have reduced their forward sales, and speculators have reduced their borrowed gold selling. Commodity prices and wages are rising. Yet the price of gold has declined steadily. With demand so much greater than supply, the price of gold should be rising sharply. According to the Office of the Controller of the Currency, the notional value of the off-balance-sheet gold derivatives on the books of U.S commercial banks exceeds $87 billion, which is greater than total U.S. official gold reserves of approximately 8,140 metric tonnes. Gold derivatives surged from $63.4 billion in the third quarter of 1999 to $87.6 billion in the fourth quarter, after the Washington Agreement was announced. The notional amount of off-balance-sheet gold derivative contracts on the books of Morgan Guaranty Trust Co. went from $18.36 billion to $38.1 billion in the last six months of 1999. Veneroso Associates estimates that the private and official-sector gold loans stood at 9,000 to 10,000 tonnes at the end of 1999. Most of these loans represent gold that has been sold in the form of jewelry and cannot be retrieved. Mine supply of gold for all of 1999, according to trade sources, was only 2,579 tonnes. Thus the gold loans are far too big too be repaid back in a short time. The swift $84 rise in the gold price following the Washington Agreement caused a panic among bullion bankers. But that was only a warning of what is to come. Federal Reserve Chairman Alan Greenspan and Treasury Secretary Lawrence Summers, responding to GATA's inquiries through members of Congress, have denied any direct involvement in the gold market by the Fed and the Treasury Department. But they have declined to address whether the Exchange Stabilization Fund, which is under the control of the treasury secretary, is being used to manipulate the price of gold.
Several prominent New York bullion banks, particularly Goldman Sachs, from which the immediate past treasury secretary, Robert Rubin, came to the Treasury Department, have moved to suppress the price of gold every time it has rallied over the last year. The Gold Anti-Trust Action Committee believes that U.S. government officials and these bullion banks have induced other governments to add gold supply to the physical market in recent years to suppress the price. Britain's National Accounting Office is now investigating the Bank of England's decision to sell off more than half its gold. Contrary to proper accounting practice, reductions in gold in the earmarked accounts of foreign governments at the New York Federal Reserve Bank are being listed by the Commerce Department as the export of non-monetary gold. These "exports" from the Fed occur upon rallies in the gold price.
WHY WOULD ANYONE WANT TO SUPPRESS THE PRICE OF GOLD?
1) Suppressing the price of gold has made it a cheap source of capital for New York bullion banks, which borrow it for as little as 1 percent of its value per year. Gold is borrowed from central banks and sold, and the proceeds are invested in the financial markets in securities that have much greater rates of return. As long as the price of gold remains low, this "gold carry trade" is a financial bonanza to a privileged few at the expense of the many, including the gold-producing countries, most of which are poor. If the price of gold was allowed to rise, the effective interest rate on gold loans would become prohibitive.
2) Suppressing the price of gold gives a false impression of the U.S. dollar's strength as an international reserve asset and a false reading of inflation in the United States. Too much gold is being consumed at too cheap a price. Massive amounts of derivatives are being used to suppress the gold price. If this situation is not corrected soon, there will be a gold derivative credit and default crisis of epic proportions that will threaten the solvency of the largest international banks and the world standing of the dollar. As you are aware, a 90 page document of our extraordinary findings was personally delivered to your offices last Thursday. The Gold Anti-Trust Action Committee requests that a full and complete investigation be launched into this matter as soon as possible.
THE LONGER THE GOLD PRICE IS ARTIFICIALLY HELD DOWN, THE BIGGER THE EVENTUAL BANKING CRISIS.
Extensive research has led the Gold Anti-Trust Action Committee (GATA) to the conclusion that the gold market is being recklessly manipulated and now poses a serious risk to the international financial system.
GOLD ANTI-TRUST ACTION COMMITTEE, INC.
Bill Murphy : Chairman / LePatron@LeMetropoleCafe.com
Chris Powell : Secretary / Treasurer / GATAComm@aol.com
Ethan B. Stroud : Attorney at law,formerly Justice Department, Treasury Department
John R. Feather : Attorney at law, formerly legal staff, Federal Reserve Bank
GOLD ANTI-TRUST ACTION COMMITTEE, INC.
Suite 1203 4718 Cole Avenue, Dallas, Texas 75205
http:// www.gata.org
Department, Treasury Department Federal Reserve Bank
SENATE BANKING,HOUSING AND URBAN AFFAIRS
HOUSE BANKING AND FINANCIAL SERVICES
