Gold: recent changes in market psychology "a game-changer"

Investors Take Note: The Swiss Gold Referendum Has Already Changed The Gold Market
SeekingAlpha.com
11-26-14

With a few days left before citizens of Switzerland go to the polls and vote on the much anticipated gold referendum, we've a number of recent events in the gold market that suggest that there has been a significant change in psychology. Whether the referendum passes or not, we think it has already transformed the gold market - gold is now in the public forum, and it seems like gold is proving to be a very political issue.

We're also seeing central banks starting to become very active in the gold market as well - the most sovereign and political activity in the gold market in quite some time.

Let us take a look at a few recent central bank actions that we think are proof of this change of psychology.

The Russian Central Bank Continues to Accumulate Gold

It was just last month that we covered the largest purchase of gold by the Russian Central Bank since 1998 - when the Ruble collapsed. Well it turns out that they weren't done, and despite some silly talk in the media about Russia selling gold to support the Ruble, Russia decided to buy another 600,000 ounces. [see graph of accumulation at link below]

This has simply continued a trend of the Russians buying gold in large regular amounts, after all 600,000 ounces of gold works out to a little less than 20 tonnes of gold. That's around 8% of total world gold mine production for the month - not an insignificant amount of gold.

The Netherlands Repatriates 122.5 Tonnes of Gold

In a rather surprising announcement issued on November 21st, the Dutch have secretly repatriated 122.5 tonnes of gold held at the Federal Bank of New York.

This was a very strange announcement because there really was no visible pressure for the country to change the location of its gold, especially considering it was being held in the supposedly safe NY Federal Reserve vaults. But these type of events do not happen haphazardly and do a lot to validate our position that the psychology in the gold market (at least when it comes to central banks) has changed, and there is a strong desire to repatriate gold.

The big question is why? We don't have a answer for that, but the only reasons that we can brainstorm is that either central banks are trusting each other less OR they are worried about the health of the financial system.

The European Central Bank May Turn to Buying Gold

Another very strange gold-related announcement came in a speech by Yves Mersch, a member of the European Central Bank (ECB) Executive Board, when he discussed the possibility of buying all types of financial assets - specifically mentioning gold as one of those assets. Gold is almost taboo in central banker speeches so the very mention of it is quite unusual, but when digging deeper there is even something stranger than that.

Compared to stocks and ETF's, the amount of physical gold available to be bought is a fraction of the other asset classes - it is not a big market. So for gold to be specifically mentioned as a potential asset to buy to inject liquidity in the financial system doesn't make a lot of sense UNLESS you have another purpose.

Oh La La! French Opposition Look to Repatriate French Gold

We've saved the best for last. Over the past week, Marine Le Pen, the leader of France's Front Nationale, the primary opposition party and the one that is currently leading in the polls, published a letter to the French Central Bank urging a complete repatriation of all French gold held abroad.

In this letter, she cited the Swiss Gold Referendum and the recent repatriation of Dutch gold as examples of other central banks and nations repatriating their own gold. Additionally, she also requests that the French should complete a complete audit of their gold, and a public disclosure of all gold leasing, lending, or arrangements concerning French gold.

First, the repatriation of 2400 tonnes of French gold (we don't know how much of that is currently abroad) may significantly affect the gold leasing market as if any of that gold is leased it will have to be bought back. The fact is that we think a lot of it may be leased or have multiple claims on it, and the evidence is the fact that Germany couldn't repatriate a much smaller amount of gold over a much longer time frame.

That is a topic for another day, but if there were no claims or gold leasing going on with the German gold it would have been repatriated as per their request - what happens if the French demand almost four times as much gold over a year? Somebody is going to have to buy a lot of gold on the physical market to cover this request and we highly doubt it can be done with gold prices anywhere close to current levels.

Finally, and perhaps more importantly, this French request is another domino that may knock over many other dominoes in the gold world. Just as Marine Le Pen cited the Dutch repatriation and Swiss gold referendum, other parties in other nations will cite the French repatriation request.

The Germans are the first to come to mind, but don't count out the Italians (Beppe Grillo is no fan of the euro) - both of those nations hold more gold than the French.

People shouldn't forget it was France's Charles De Gaulle that ultimately was the deciding factor in forcing the US to close the gold window by exchanging US dollars for gold - Marine Le Pen wouldn't be the first French leader to change the financial system by demanding France's gold.
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The public (both citizens and politicians) are now scrutinizing what central banks are doing with gold reserves - that in itself is something that is a game-changer. [i.e. the power of increased knowledge and awareness]

We already know that the physical gold market is quite small and that it has been driven by paper markets for years. But the repatriation attempts and attention paid to physical central bank gold holdings may finally push the physical market over the edge as there really are only a few ounces of physical gold that back a huge leveraged paper market.

If the gold market is leveraged, over-leased, and re-hypothecated as much as the evidence suggests (and we believe), then we may see a huge "bank-run" on physical gold. The consequences of this are very unpredictable - but it would certainly mean a much higher gold price
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Investors should remember that changing psychology is very hard to pinpoint with a single event - it takes time to see and become obvious. But there is change coming in the psychology of the gold market and the Swiss Referendum is so far the most obvious of those signs. We think we'll see many more of them to come regardless of what happens on November 30th.

If people doubt the importance of psychology all they have to do is look at any bank run - it all starts with a change in psychology and not a change in balance sheet.

A depositor simply requests to take physical possession to what he already supposedly owns (i.e. a net zero change on the balance sheet), and if enough people do it (i.e. change in psychology about where you want your money) then we have a bank-run.

Is that what we're seeing in the gold market? If so, you better have some gold.

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_http://seekingalpha.com/article/2714475-investors-take-note-the-swiss-gold-referendum-has-already-changed-the-gold-market

Thanks for sharing this JGeropoulas! The movement of many central banks and economic authorities around the world, especially when taking into consideration the rash of mysterious banker deaths in the US and elsewhere, makes me think a rough economic period will be coming within a year or so.


I'm considering investing a portion of my $ into gold just to act as a buffer for economic disintegration in the western hemisphere following the collapse of the petrodollar, but I have no idea how to do this properly. Does it just lie around the house? How difficult is it to find safety deposits that are insured for gold items? Etc. Etc. Is this a conversation I should be having with one of gold brokers, or my credit union? :/ Some advice would be appreciated on this...

I'm not your gold broker but if I ever decided to buy gold, it should be delivered physical gold, that is, gold that I could hold in your hand and store in my house. I would never buy any of the gold substitutes such as gold stocks, gold fund, or even gold stored in an insured safety deposit box at the bank. Regarding the security issue, it is simply a question where the gold is more likely to be lost: at my house or at the bank's safety deposit box in a gold run. It's up to the individual but I know what my choice would be.

Get your stuff now! Don't wait! I am thinking the average Joe will be taking a heck of a risk trying to buy goods with precious metals. Some feel as long as they have a little gold for backup that they'll be able to trade for goods after the paper currency collapses. Why wait until after? Do you think you are savvy in regards to trading gold for goods? Do you already know of a safe place to barter and where you will remain anonymous (no snitches)?

The secure feeling of owning gold coins is kind of an endorphin rush every time you visit your stash but to what end? What standing will we have (in the new control system) that will allow us to purchase goods with precious metals when the populace has been indoctrinated to snitch on suspicious activities? An example of what l am trying to confey would be the 911call from Walmart by a concerned shopper. The Walmart shopper saw a man holding a gun under his arm and talking on his cell phone in the toy department. The police showed up and shot him dead because they were told by the dispatcher, (thanks to the see something say something snitch), there is a man with a gun and he is aiming it at children in the toy department at Walmart. The store surveillance video showed a man shopping for a toy BB gun for his son and discussing the possible purchase with his wife. The 911 callers statement to the dispatcher was proven false.

This is the kind of mentality that the controllers want (see something say something).

Rant over, and sorry if this is a hijack. :/

whitecoast said:

I'm considering investing a portion of my $ into gold just to act as a buffer for economic disintegration in the western hemisphere following the collapse of the petrodollar, but I have no idea how to do this properly. Does it just lie around the house? How difficult is it to find safety deposits that are insured for gold items? Etc. Etc. Is this a conversation I should be having with one of gold brokers, or my credit union? :/ Some advice would be appreciated on this...

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Consider low-tech and bury it on your (or family) property and tell one trusted person, preferably your heir. Pray that you never need it (if so inclined) and go about your business as before.

michaelrc said:

Do you think you are savvy in regards to trading gold for goods? Do you already know of a safe place to barter and where you will remain anonymous (no snitches)?

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I can certainly see your point about using gold to purchase goods. It would be difficult at best. And how to determine how many grams a certain commodity would be worth? And then the problem, if you have say 1 oz coins (about 28 grams) how much "stuff" would someone be willing to trade for said coin, when the goods may be of more use than the coin?

As for the "see something, say something" Homeland Security campaign, I can attest that it has been quite successful. In our small town, the police field not less than 10 calls/day for "suspicious activity". Typically, this activity is as silly as someone pulling their car to the side of the road to take a cell phone call, or just a couple two or three teenagers standing on the street talking.

I think it is more useful at this point, to spend excess cash on becoming self sufficient for basics, although based on collapse scenarios in other countries, precious metals do remain useful. https://cassiopaea.org/forum/index.php/topic,32547.0.html If you search the forum using the key word "preppers" there are several threads on the subject. https://cassiopaea.org/forum/index.php?action=search2

And last but not least, are you prepping your diet? Clearing out emotional baggage via EE? Building a community of trusted people where you live? And if you have spare cash, a bit of gold and silver isn't a bad idea either. ;)

I've been buying since 2010, primarily silver. First physical stored in our house (and my area have armed guards and fences), then physical stored with Brinks in Singapore, and now I'm buying mining stocks (primarily the streamers, but also some ridiculously cheap exploration companies). I think staging it like that, with the various risks of each type, is a good strategy.

michaelrc said:

Do you think you are savvy in regards to trading gold for goods? Do you already know of a safe place to barter and where you will remain anonymous (no snitches)?

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I think the main purpose of buying physical gold or silver is not to trade during the financial collapse itself - instead it is a good way to protect your savings against currency devaluation. It seems that there will be a new currency system set up pretty soon if/when the old one stops working.

It is probably best to have enough food stored to last you at least a few months. It is probably also a good idea to have a larger amount of cash on you, since the old currency may still be accepted for a while after the banks close.

This explains some of the potential consequences if the Swiss gold referendum is successful today: http://www.lewrockwell.com/2014/11/thorsten-polleit/go-switzerland%e2%80%a8-go/ .

Regarding French gold as mentioned in the article:

First, the repatriation of 2400 tonnes of French gold (we don't know how much of that is currently abroad)

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The important thing here is that we don't know how much is abroad. Repatriation means to bring back gold that is currently stored abroad. The article then forgets about us not knowing how much is abroad and basically assumes that it is all abroad and that there hence will be a need to buy 2400 tons on the open market. This may not be the case.

Another interesting thing is that several countries have their gold stored in France. Now if those countries starts to put pressure on bringing back the gold stored in France AND that gold is already leased out, then that will create a few ripples too. There is only that much physical gold.

Regarding the Swiss gold vote, there is virtually a news blackout about it. Nothing on the front page of the two main Swiss papers: http://www.nzz.ch/ and http://www.tagesanzeiger.ch/
Telling indeed. This will not be allowed to pass, I think. But regardless, the cat is out of the box and gold is reclaiming a place in publice debates and the currency markets.

To Whitecoast: Having silver coins is not a bad idea and don't represent the same value as gold. As others have said, to have a bit of both apart from food and survival stuff is not a bad idea. Have physical gold/silver and no, I wouldn't have it deposited in banks or credit unions.

Hey, lets not forget we're moving to a different place are we not? What we have system wise now is supposed to fragment so anouther paradigm can be created, right? Also isn't the plan of those in power, genocide? During the dirty war in Argentina it has been reported that there were spies everythere therefore travel was tough. It has been said many times "when people lose everything they lose it". With that thought in mind, this would explain anecdotal accounts of scores of people in Argentina preying upon others just to remain alive. Those in power know what kind of moves that they need to make so that we take one anouther out.
One example might be the false flagging of an entire city. In other words they could use govt provocateurs to blow up a federal building, tell the people that the only way that they can provide security is to restrict travel. In other words cordon off the city perimeter. Lockdown! The people will be told that everyone needs to shelter in place (aka Boston Mass.) and all will agree that this is necessary to find the culprits. They will work "for the welfare of our children" statement into the mix somewhere. Remember your local officials are no longer in charge. This happened in Missouri did it not? The governor ordered the deployment of the national guard and the president stayed the order. Those elected officials that many of us have ties with or know someone who knows someone will be rendered impotent. The patsy police force will be federalized.

Now that the city is pretty much under martial law... oops, the water plant, natural gas, electrical substation you name it rendered useless by explosions. But don't be alarmed the lastest news heard by everyone was that the authorities were hot on the culprits tail.... " Don't be alarmed"? I am told to shelter in place without water, heat and no lights and not to worry things will improve soon...wt_!

Civility now is just a word... Will we realize we've been played? Probably not. Isn't that the reason the statement "5th density on the hill", has been repeated several times?

Not to put too fine a point on things, but lets face it, most of humanity hasn't a boot strap let alone a little bit of knowledge as to why events are happening the way they are.

Psst... psst...yeah you, come here! Got anything to trade for this gold dime..?

michaelrc said:

Also isn't the plan of those in power, genocide?

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We don't know what their plan is. It seems to be more about tightening the control than outright genocide. I think many of those are heavily invested in the current system (finance, education, media, etc.) and would not want to lose all this "hard work" on their part.

It is a good idea to have enough food and access to water (or stored water) to last for some months. Gold and silver are for the time after, when things quiet down again. Depending on the place it might take longer in some places to get back to 'normal'. I'm thinking large cities are particularly at risk.

Other than a financial breakdown and "reset" there is of course also the possibility of natural disasters (Ice Age, comets, earthquakes, maybe a large solar flare knocking out parts of the electrical grid)...

axj said:

michaelrc said:

Also isn't the plan of those in power, genocide?

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We don't know what their plan is. It seems to be more about tightening the control than outright genocide. I think many of those are heavily invested in the current system (finance, education, media, etc.) and would not want to lose all this "hard work" on their part.

It is a good idea to have enough food and access to water (or stored water) to last for some months. Gold and silver are for the time after, when things quiet down again. Depending on the place it might take longer in some places to get back to 'normal'. I'm thinking large cities are particularly at risk.

Other than a financial breakdown and "reset" there is of course also the possibility of natural disasters (Ice Age, comets, earthquakes, maybe a large solar flare knocking out parts of the electrical grid)...

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I agree. We don't know what the plan is exactly, but we do know that it always seems designed to exert more control over the population. Which doesn't necessarily include genocide, though it also doesn't exclude the potential murder of innocent people (i.e. Palestine, Ukraine, Libya, Iraq, etc.).

Some stored food/water, knowledge to increase self-sufficiency, a reliable network, and improving our physical/mental/emotional health should be the focus. Gold is only a store of value, and even then you can't eat it. But if you have 'needful things' and know how to use them, that could be worth more than gold.

I think we should have a pretty good idea of what their plan is by now. Many of what are hailed as "brilliant"or "wizards of smart" have produced papers and speeches on population reduction as far back as the 40's and 50's. Today however the're far more sophisticated at the sales job. How's that ole saying go... "they had me bent over and my pants around my knees and l never even knew my belt was undone".



Ethan A. Huff
Natural News
March 1, 2012

(NaturalNews) After it was exposed that the Bill & Melinda Gates Foundation, the philanthropic brainchild of Microsoft founder Bill Gates, purchased 500,000 shares in Monsanto back in 2010 valued at more than $23 million, it became abundantly clear that this so-called benevolent charity is up to something other than eradicating disease and feeding the world’s poor (http://www.guardian.co.uk). It turns out that the Gates family legacy has long been one of trying to dominate and control the world’s systems, including in the areas of technology, medicine, and now agriculture.

The Gates Foundation, aka the tax-exempt Gates Family Trust, is currently in the process of spending billions of dollars in the name of humanitarianism to establish a global food monopoly dominated by genetically-modified (GM) crops and seeds. And based on the Gates family’s history of involvement in world affairs, it appears that one of its main goals besides simply establishing corporate control of the world’s food supply is to reduce the world’s population by a significant amount in the process.

William H. Gates Sr., former head of eugenics group Planned Parenthood

Bill Gates’ father, William H. Gates Sr., has long been involved with the eugenics group Planned Parenthood, a rebranded organization birthed out of the American Eugenics Society. In a 2003 interview with PBS‘ Bill Moyers, Bill Gates admitted that his father used to be the head ofPlanned Parenthood, which was founded on the concept that most human beings are just “reckless breeders” and “human weeds” in need of culling (http://www.pbs.org/now/transcript/transcript_gates.html).

Gates also admitted during the interview that his family’s involvement in reproductive issues throughout the years has been extensive, referencing his own prior adherence to the beliefs of eugenicist Thomas Robert Malthus, who believed that populations of the world n eed to be controlled through reproductive restrictions. Though Gates claims he now holds a different view, it appears as though his foundation’s initiatives are just a modified Malthusian approach that much more discreetly reduces populations through vaccines and GMOs (http://en.wikipedia.org/wiki/Thomas_Robert_Malthus).

Gates Foundation has invested heavily in converting Asian, African agricultural systems to GMOs

William Gates Sr.’s association with Planned Parenthood and continued influence in the realm of “population and reproductive health” is significant because Gates Sr. is co-chair of the Bill & Melinda Gates Foundation (http://www.gatesfoundation.org/leadership/Pages/william-gates-sr.aspx). This long-time eugenicist “guides the vision and strategic direction” of the Gates Foundation, which is currently heavily focused on forcing GMOs on Africa via its financing of the Alliance for a Green Revolution in Africa (AGRA).

The Gates Foundation has admittedly given at least $264.5 million in grant commitments to AGRA (www.gatesfoundation.org/about/Documents/BMGFFactSheet.pdf), and also reportedly hired Dr. Robert Horsch, a former Monsanto executive for 25 years who developed Roundup, to head up AGRA back in 2006. According to a report published in La Via Campesina back in 2010, 70 percent of AGRA’s grantees in Kenya work directly with Monsanto, and nearly 80 percent of the Gates Foundation funding is devoted to biotechnology (http://www.organicconsumers.org/articles/article_21606.cfm).

The same report explains that the Gates Foundation pledged $880 million in April 2010 to create the Global Agriculture and Food Security Program (GAFSP), which is a heavy promoter of GMOs. GAFSP, of course, was responsible for providing $35 million in “aid” to earthquake-shattered Haiti to be used for implementing GMO agricultural systems and technologies.

Back in 2003, the Gates Foundation invested $25 million in “GM (genetically modified) research to develop vitamin and protein-enriched seeds for the world’s poor,” a move that many international charities and farmers groups vehemently opposed (http://healthfreedoms.org). And in 2008, the Gates Foundation awarded $26.8 million to Cornell University to research GM wheat, which is the next major food crop in the crosshairs of Monsanto‘s GM food crop pipeline (http://www.organicconsumers.org/articles/article_21606.cfm).

If you control agriculture, you control the populations of the world

The Gates Foundation‘s ties with Monsanto and corporate agriculture in general speak volumes about its real agenda, which is to create a monopolistic system of world control in every area of human life. Vaccines, pharmaceuticals, GMOs, reproductive control, weather manipulation, global warming — these and many other points of entry are the means by which the Gates Foundation is making great strides to control the world by pretending to help improve and save it.

Rather than promote real food sovereignty and address the underlying political and economic issues that breed poverty, Gates and Co. has instead embraced the promotion of corporately-owned and controlled agriculture and medicine paradigms that will only further enslave the world’s most impoverished. It is abundantly evident that GMOs have ravished already-impoverished people groups by destroying their native agricultural systems, as has been seen in India (http://www.naturalnews.com/030913_Monsanto_suicides.html).

Some may say Gates’ endeavors are all about the money, while others may say they are about power and control. Perhaps it is a combination of both, where Gates is still in the business of promoting his own commercial investments, which includes buying shares in Monsantowhile simultaneously investing in programs to promote Monsanto.

Whatever the case may be, there is simply no denying that Gates now has a direct interest in seeing Monsanto succeed in spreading GMOs around the world. And since Gates is openly facilitating Monsanto‘s growth into new markets through his “humanitarian” efforts, it is clear that the Gates family is in bed with Monsanto.

“Although Bill Gates might try to say that the Foundation is not linked to his business, all it proves is the opposite: most of their donations end up favoring the commercial investments of the tycoon, not really “donating” anything, but instead of paying taxes to state coffers, he invests his profits in where it is favorable to him economically, including propaganda from their supposed good intentions,” wrote Silvia Ribeiro in the Mexican news source La Jornada back in 2010.

“On the contrary, their ‘donations’ finance projects as destructive as geoengineering or replacement of natural community medicines for high-tech patented medicines in the poorest areas of the world … Gates is also engaged in trying to destroy rural farming worldwide, mainly through the ‘Alliance for a Green Revolution in Africa’ (AGRA). It works as a Trojan horse to deprive poor African farmers of their traditional seeds, replacing them with the seeds of their companies first, finally by genetically modified (GM).”

Sources for this article include:

http://www.guardian.co.uk

http://www.seattleglobaljustice.org

http://english.pravda.ru

http://www.organicconsumers.org/articles/article_21606.cfm

http://en.wikipedia.org/wiki/American_Eugenics_Society

http://www.naturalnews.com/033148_seed_companies_Monsanto.html

axj said:

michaelrc said:

Do you think you are savvy in regards to trading gold for goods? Do you already know of a safe place to barter and where you will remain anonymous (no snitches)?

Click to expand...

I think the main purpose of buying physical gold or silver is not to trade during the financial collapse itself - instead it is a good way to protect your savings against currency devaluation. It seems that there will be a new currency system set up pretty soon if/when the old one stops working.

Click to expand...

I agree, you will be your own central bank as others have said before. Also, think what happened to the bank accounts of the people in Cyprus. Didn't they lose part of their money overnight?

The Eurozone powers-that-be (mainly, Germany) insisted that the depositors in Cyprus's banks pay part of the tab.

Not the bondholders.

The depositors. The folks who had their money in the banks for safe-keeping.

When Cyprus's banks reopen on Tuesday morning, every depositor will have some of his or her money seized. Accounts under 100,000 euros will have 6.75% of the funds seized. Accounts over 100,000 euros will have 9.9% seized.
...
Depositors rushed to ATMs and tried to withdraw their money before it could be seized.

But the ATMs weren't working. And the government has now made it impossible to transfer money out of the country.

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http://www.sott.net/article/259854-The-crazy-theft-of-depositor-savings-in-Cyprus-could-start-a-European-bank-run-on-Monday