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New York Price of Gold Suppression * 5 1/2 Months & Counting

July 9, 2000

This article is a follow-up to both my ongoing look at how trading in the New York gold markets cancels out any overseas buying pressure, and my last article which introduces ideas on why Americans will not buy gold.

I have returned from about a 2-month trip on family business and discovered that nothing has changed. The many, many months of commentary about the imminent rise in Price of Gold (POG) and the gold mining companies are still there. Now and then there has been a 6 or 7 dollar spurt in the POG. But ….

First the pattern (see Table 1) that shows overnight trading, ending at the London AM Fix, results in a POG increase relative to the previous NY close is slightly greater than before. At the same time, there is a slightly lower tendency for the frequency of down NY POG trading to occur. The amount of these changes, however, is not enough to keep the POG from escaping a narrow trading range. There is only about a $4 increase in the POG from the last analysis to the current one. This is despite a net overseas increase of about $27 (cumulative trading from NY close to London AM Fix) during this most recent period. NY POG price suppression continues!

As long as the patterns of the cultural milieu continue as described in my last article there is little hope for large scale gold buying outside of a major crisis. Here are a few more thoughts on why that pattern succeeds.

Most people in "the land of freedom" are no longer consciously aware of the most basic expression of freedom: MORE GOVERNMENT = LESS LIBERTY.

One way to think about liberty is in terms of ownership. The extent to which an individual owns himself and by further extension the fruits of his labor, mental or physical, is liberty. This ownership implies the ability to use or dispose of all that is owned free from outside coercion. The individual can use or trade property freely anyway he sees fit as long as force or fraud is not used in the process.

Citizens have been trained to recognize the existence of slavery e.g., the pre-civil war U.S., as a condition of complete absence of liberty for blacks. They have been trained to recognize that totalitarian governments of the right, e.g., Nazi Germany and Fascist Italy, represent situations of greatly reduced liberty. For some reason, however, Communist, Socialist and Welfare State governments that have equal or greater reductions in liberty are not viewed in a similar manner. It appears that this double standard is related to the self-described goals and objectives of those governments. It is the descriptions of those goals that hold sway over the way in which governments are treated, not their outcomes. Regardless of the reduction in liberty that takes place, as long as the goals are stated in terms of increasing the common good, very little negative commentary accompanies those Communist, Socialist, or Welfare state outcomes.

Part of the problem citizens have in recognizing the deprivation of liberty that accompanies all of the above statist conditions, is that liberty itself has been redefined for them. No longer do the societal information dispensing organs of the press and the schools foster the view that liberty is the ability to act totally from ones own volition and take the responsibility for those actions. The current view seems to be that liberty is the freedom from certain conditions i.e., poverty, poor health, ignorance etc. If the statists can manage the acceptance of the later definition then they can continue and increase the extortion of income and property from the majority of citizens. This management shows itself by the public schools ignoring the history of the Bill of Rights as a basic protection from government excesses, and the universities and the media currently spending large amounts of time displaying the negative characteristics of some of the founders. In this way they can distract from the study of the real meaning of liberty and reduce opposition to our Welfare State.

To paraphrase my grandfather - the truly evil state goes beyond the demands of the dictator to follow a few rules; it demands that you love all of the rules because they are good for you.

A single ounce of gold (about 28 grams) can be stretched into a gold thread 5 miles (8 kilometers) long.
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