If you have any interest whatsoever in gold, I really would like you to read Keith Weiner’s open letter to GATA. It just may blow your mind as he answers his critics in the gold “community”.
What I see here is a man trying to get sound points across to casino patrons run amok. That is after all what GATA is, a collection of people so wrapped up in the price action of gold that they had to create a conspiracy just to validate its volatility in the futures market, which as the story goes keeps it from its rightful place at a stratospheric price.
Here is an excerpt from Mr. Weiner, but please read the whole letter. It is of utmost importance for gold bugs to know what gold is and what it is not. The highlights are mine.
Now let me address the second part of your headline, that I deny that anything is wrong in the gold market. Actually, everything is wrong in the gold market, starting with the very use of fiat money, and the fact that we buy and sell gold in the first place.
Aside from that, there should not even be a gold futures market. There should be a gold interest rate market—i.e. a gold bond market. There should not be propaganda in every government school, teaching that money means Federal Reserve Notes and that gold is a volatile commodity. There should not be investment regulation that forces advisors to treat gold as risky, or an investment (it is neither).
There should not be a Fed-induced perpetually-falling interest rate which fuels endless asset market speculations including gold. There should not be a general belief that investing means seeking capital gains provided by the next investor who hands over his capital as your profits. There should not be capital gains taxes on gold, and taxpayer should not be forced to keep their books in dollars, which show a phantom profit if their gold holding increases in price.
One of the consequences of this lust for capital gains combined with the belief that gold is just another chip in the casino, to bet on the price action, is the gold futures market. Futures markets developed as the way for people to coordinate storage and later consumption of commodities which are produced seasonally. Gold is not produced seasonally (or consumed).
You have casino patrons bitching, moaning and making a cottage industry of decrying nefarious actions in a casino AKA the futures market. As I have personally said for years now, gold is not about price; it is about value. I get my patience tested when people ask me about the gold price as if it’s just another table at the casino. This simple message of value just does not seem to register with many, including our golden heroes at GATA.
If gold is so repressed by evil entities, can you tell me why the chart below is so elevated since 2005? Never mind the gold manipulators, how about those evil price repressors of oil and copper and grains and hogs? Why, in the age of runaway inflation all of that stuff should be much higher in price!
Look at the Gold/CRB ratio and tell me that gold has been repressed. The only people crying about gold price repression are those wanting to get rich off of it. Gold won’t make you rich, but it will keep you intact. A simple value proposition. Please read Keith’s letter.
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