Sunday, April 1, 2012

Clive Maund: 'Talk of Cartel Manipulating Gold is Humbug'

Clive Maund just won't give it up. The analyst who flip-flops more frequently than a freshly reeled in steelhead is again bullish on gold, but not because of any alleged price manipulation by the cartel.
Maund had this to say to GATA and the rest of those who believe in price suppression of gold:

This chart shows that all the talk about gold being manipulated and held down by some shady cartel is humbug, and instead of falling for this nonsense you should ask yourself, what is the agenda of the people peddling it...even if the gold market is being manipulated to some extent, SO WHAT?

While Maund seems to understand that gold is a protection against the debasement of currency and the damage cause by inflation and QE to INFINITY...he clearly has no understanding of how the gold and silver market's function, and the ultimate purpose of manipulation. 

The fact that gold and silver have risen for more than a decade is not an indication that the cartel is a figment of gold bugs' imaginations, only evidence of the fact that it is impossible to manipulate an asset over the long term in the opposite direction that the free market wishes to take that asset. 

The cartel has successfully managed the ascent of gold (and to a lesser extent silver), capping price action to a maximum daily gain of 2% in gold, and smashing the metals counter-intuitively when major macro economic events occur (think the take-down 5 minutes prior to the Swiss currency devaluation). 

As we have documented repeatedly, the real purpose of PM manipulation is interest rate swaps, a $110 Trillion market that must be managed to artificially keep interest rates low, and continue the debt ponzi. 

Unfortunately, Maund has no understanding of these concepts.  His full anti-gold drivel is below:

Gold and silver's recent reaction has brought a lot of conspiracy theorists out of the woodwork again as usual, harping on about "The Cartel" and their cruel and wicked plan to suppress the gold price, and deprive PM sector investors and speculators of the rich rewards they have been looking forward to for so long, all because a rise in the price of gold and silver will declare to the world the bankruptcy of their fiat monetary system.

Well, if that their aim, our first chart at the top of the page shows that they have not had much success with their evil plan, as gold has risen from a low at about $250 to a recent high above $1900 in just 11 years - so much for the success of The Cartel. Carping on about some shady bunch of manipulators suppressing the gold price makes about as much sense as moaning to a gas station attendant about the price of gas - stop wasting time and pay up and get on with your life.

So what if the gold and silver price are being manipulated to some extent? - most markets are - those in power will always manipulate things to their advantage, that's basic human nature. If you must ask questions then the point to start is to enquire about why these people are promulgating these conspiracy theories in the first place - are they just cranks or are they making money out of it some way - what's their angle?

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