first majestic silver

The World Paper Council

May 17, 2013

Once upon a time, an entity called the “World Gold Council” was created. It was supposed to be an industry trade-group, which (like all industry trade-groups) promotes the health and growth of their industry. But that’s not how it turned out.

To understand the World Gold Council, one need do little more than examine its history. It was created in 1987. Was this the beginning of some new, Golden Age for the gold mining industry? Hardly. In fact, it marked the early stages of the most successful era of gold price-suppression in history, and the complete destruction of the global gold-mining industry – with more than 90% of the world’s gold mines being bankrupted.

If the World Gold Council is really an “industry trade-group”, then it was/is the most incompetent/inefficient such entity ever created. But, of course, the World Gold Council doesn’t serve “gold” or even gold-mining. It serves paper – banker-paper, to be precise.

Like all (supposed) industry trade-groups, the WGC is officially comprised of a collection of the world’s largest gold-miners; who themselves are nothing but a herd of banker-sycophants. Lest anyone suffer from the delusion that the world’s gold miners (and the WGC) were merely “innocent bystanders” in the destruction of the global gold-mining industry, more facts are in order.

At around the time the WGC was formed; these same large, gold-miners were in the process of enslaving themselves to the bankers by forward-selling 100’s of tons of gold which hadn’t even been dug out of the ground yet – in order to further depress prices in the sector by creating a glut of supply.

This policy of self-destruction became institutionalized. As quickly as the sycophant-miners identified new reserves in the ground, they would forward-sell that ore to the bankers, permanently discounting their own commodity. Those readers who don’t fully comprehend this intentional suicide-spiral need to be reminded of another industry trade-group, with which we are all familiar: OPEC.

When OPEC was created, did it immediately result in a long-term depression in the price of oil? Did it result in 90% of the world’s oil companies being bankrupted? Did OPEC members forward-sell their oil in massive quantities? No. Precisely the opposite, in every respect.

OPEC didn’t forward-sell their oil to depress the price; they restricted supply to maximize total revenues for their industry. Their industry did not go into a long-term depression where more than 90% of all companies were bankrupted. Instead, this industry trade-group is directly responsible for the robust/health profits of the world’s oil companies.

But don’t take my word for it. Feel free to check with Rex Tillerson, CEO of Exxon. The $400 billion market-cap for Exxon is larger than the combined market-caps for the entire, global gold-mining industry. Indeed, Mr. Tillerson’s personal, annual compensation is larger than the individual market-caps of most of the world’s gold-mining companies.

Clearly the World Gold Council is nothing but a slave-collective, in bondage to the bankers; and which serves not the interests of gold (or gold-mining) but rather the promotion of the bankers’ paper monetary system. Need more convincing? Simply look around their website.

Try finding information about gold (i.e. supply/demand data). What one will discover is that such data goes back no more than two years. This is despite the fact that gold mining is one of humanities oldest industries, where we have been mining/refining gold for nearly 5,000 years. Conversely there are a plethora of essays going back more than 15 years; letting us know about all the ways in which the bankers want to use our gold to make their paper system “better.”

The World Paper Council is, in reality nothing but a banking industry sub trade-group; composed of some of the bankers most-loyal servants, paying homage to their Masters. More proof that the WGC serves paper rather than gold came out today, with its utterly astonishing reporting on Q1 for the gold market.

Knowledgeable readers already know that we are in the process of the most-massive liquidation of paper-gold products. Those readers also know that much/most paper-gold is, in fact, just paper. This is something which commentators such as myself have long suspected. However it is something to which the bankers and mainstream media have now implicitly confessed.

This occurred in response to the current, massive, gold supply-deficit to the gigantic Indian market. A series of articles came out in the mainstream media, where bankers proposed “solving” this gold supply-deficit by selling Indians lots more paper-gold. In other words, they were going to increase the supply of gold by selling paper-gold.

Obviously the only, possible way in which selling “paper-gold” can increase the total supply of gold is if the bankers are simply selling paper and calling it “gold.” Given that bankers have a track-record of selling paper and calling it “gold” which literally traces back to the “money-changers” of a thousand years ago, this is hardly a revelation.

As regular readers also know, we are currently seeing the most-radical increase in gold demand in the modern history of our gold markets. This is evidenced by a chart already seen previously:

[chart courtesy of Nick Laird,]

Thus with the simultaneous occurrence of a massive liquidation of paper-called-gold, and a massive surge in demand for real gold; this was the headline from the WGC’s Q1 analysis, as reported by another one of the bankers’ most-loyal friends, Kitco Metals:

WGC: 1Q Global Gold Demand Contracts Due To ETF Outflows; Jewelry Rises

This headline was immediately followed by more of Kitco’s trademark gold-bashing:

…Large outflows from gold exchange-traded funds led to a 13% year-on-year decline in global gold demand during the first quarter to 963 metric tons, the World Gold Council said Thursday.

If one actually goes to the WGC website and reads through the report, it is presented in an almost opposite manner to Kitco’s bias. But understand this is a tag-team operation. Perhaps only 1% of the gold investors who see Kitco’s “WGC” headline and (supposed) summarization will ever actually go and read the original report.

The WGC produces the intentionally misleading data, and then the spin-doctors of Kitco “present it.” The report of a “13% decline in Q1 gold demand” may have been (conveniently) buried within the WGC’s own report, but it is obviously the “headline number.” In a quarter where all the facts trumpeted a massive surge in gold-demand; the WGC reported a mythical decline in year-over-year demand:

  • Total jewelry demand up 12%
  • Jewelry demand in China up 19%
  • Total demand in India up 27%
  • Total demand in China up 20%
  • U.S. demand up by 6% “for the first time since 2005”
  • Demand for gold bars/coins in China up 22%
  • Demand for gold bars/coins in India up 52%
  • Demand for gold bars/coins in U.S. up 43%
  • Global demand for “official coins” up 18%
  • Demand for gold by Central Banks exceeds 100 tons for the 7th consecutive quarter

Meanwhile, on the supply side, mine-supply rose by only 4% while scrap-sales (which account for over 1/3rd of total supply) fell by 4%, meaning total supply only rose by 1%. Obviously in a market which currently features scorching demand for real gold, a 1% increase in supply creates a totally unsustainable supply/demand paradigm – which can only be put back into balance via a massive increase in price.

This is reflected by the recent fanaticism which the bankers have displayed in trying to sell more of their paper-called-gold; at the same time that the Smart Money is ridding itself of this paper at the fastest rate in history. It is also reflected in the shameless dishonesty of the mainstream media.

In the midst of one of the strongest surges in demand in this entire, 13-year bull market; we have the propaganda machine perversely referring to the gold market as a “bear market”. This is despite the fact that all available data indicates not only a massive increase in demand (for real gold), but also a massive increase in “premiums” to purchase actual gold.

It is not the price (or demand) for gold which has recently plummeted. It is the price/demand for paper-called-gold which has plummeted. A World Gold Council could not make such a mistake. A World Paper Council would be expected to make that mistake.

Jeff Nielson

Jeff NielsonJeff Nielson is co-founder and managing partner of Bullion Bulls Canada; a website which provides precious metals commentary, economic analysis, and mining information to readers/investors. Jeff originally came to the precious metals sector as an investor around the middle of last decade, but soon decided this was where he wanted to make the focus of his career. His website is

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