Le Metropole Members,
( BW)(TX-GATA) Intervention against Gold Rising Sharply,
GATA Says, Citing New Derivatives Report
Business Editors
DALLAS--(BUSINESS WIRE)--May 23, 2005-
Government intervention against the gold price has risen sharply since
the middle of last year, the Gold Anti-Trust Action
Committee reported today.
The increase in intervention, GATA said, was disclosed
last week in the Bank for International Settlements'
semi-annual report on the issuance of derivatives by major
banks and dealers in G-10 countries. The report was studied
by GATA's consultants -- James Turk, founder of GoldMoney
and editor of the Freemarket Gold & Money Report; Michael
Bolser, editor of the Interventional Analysis newsletter;
and Reginald H. Howe, gold market analyst and principal of Golden Sextant Advisers.
The new derivatives numbers from the BIS are "stunning"
in regard to gold, Turk said, summarizing GATA's research.
"In major banks and dealers in the G-10 countries, the total notional value of gold derivatives rose from $318 billion
at mid-year 2004 to $369 billion at year-end.
"That $51 billion increase -- a 32-percent annual rate
of growth -- occurred while gold miners were reducing their hedge positions.
"The reduction in hedge positions by mining companies
should have resulted in a decrease in the aggregate position
in the BIS report. That it didn't happen suggests that the international economist Frank Veneroso is right. Here's what Veneroso had to say in the March issue of Gold Newsletter:
There is only one possible explanation for why purchases
of thousands of tonnes of gold in the futures and forwards markets do not blow the price of gold sky-high: The official sector must step in on gold price rallies as an offsetting forward seller.
How much more gold can governments dishoard to throw at
the gold market to keep the price down? 
"The answer," Turk says, "is of course unknowable, both
to us as well as to the governments intervening in the gold market. At some point the banks executing the government positions are going to reach the tipping point, when the
free-market demand for gold overwhelms government price
capping. I think that moment is near for one important
reason.
"Price capping in gold can be prolonged only by
continually supplying the market with physical metal. Right
now the demand for physical metal is strong. So governments
can sell all the paper derivatives they want, but it isn't
going to stop people from buying metal. In fact, the low
price of gold resulting from government price capping is
causing the demand for physical gold to increase."
GATA's findings on the latest BIS gold derivatives
report can be found on the Internet here:
![:]](https://goldseiten-forum.com/wcf/images/smilies/pleased.gif "Freude"){kind=small}
gefunden):
