$4.6 Billion Buy Order Propelling Gold Price!

Gold $373.70 up 90 cents - Silver $5.04 up 6 cents

September 3, 2003

Opportunity dances with those who are already on the dance floor. -- H. Jackson Brown, Jr

Gold traded either side of unchanged during the night before getting its daily slam in London. Then, cabal forces wasted little time going after the Comex specs in New York by twice taking gold below $370 support, with $369.30 the low. Result: another Gold Cartel defeat!

Not only did gold shrug off the efforts of the criminals (emails to me calling The Gold Cartel a bunch of criminals are soaring) to take gold down, it roared back in their face all session, making high after high. With a few minutes to go, gold was up $2.50 when the bad guys pounded it off its highs of the day, in ANOTHER "painting the tape" drill. Oh, for the day when we get our Commercial Signal Failure and these low-lifes are carried out.

It now appears The Gold Cartel has moved its Maginot Line up to the $375/$376 area.

The trading was very volatile in New York. As oft-mentioned in this column, frenetic trading is VERY constructive as it demonstrates The Gold Cartel has its hands full and is being taken on by strong hands. Those strong hands keep on buying. The open interest went up another 5867 contracts on Friday to 274,981. Clearly something BIG is going on here. Not that MIDAS has not gone over this for some time. Perhaps we now have a clue as to what it is.

Last evening I received a call from a veteran Café member from London. He was told by his coin dealer in the United States there is a $4.6 billion buy order out there to buy physical gold and gold coins. This particular dealer, who travels extensively overseas, only has a tiny portion of that order, $200,000 in gold coins.

If true, it is a lot of gold. At $370 per ounce, it comes out to 389 short tons, almost the total amount the 15 European nations are selling under the Washington Agreement. 389 tons would be a minimum amount because much of this gold had to be purchased at lower levels. We don’t know how much has been purchased and how much there still is to go.

Normally, I would be quite skeptical of tails of such a grandiose order. But, that is EXACTLY how gold has traded for a month and would explain the price action and why the spec longs have not been forced out by cabal raids. Every time gold dips, this deep pockets buying group is there along with the Indians, Turks, ect.

$4.6 billion is no lightweight operation. Now that the information has come to my attention, I assume the buy program has been underway for some time, but still has a ways to go. Buying that kind of size takes time. It can also be another explanation for the huge increase in open interest on the Comex. These buyers must be very sophisticated, to say the least. Before going after physical gold, they surely would load up on futures and continue to support the futures on dips to protect their positions. Knowing the huge amount of ongoing buying to be done in the cash market, that would not be an inordinately difficult task.

Again, I can’t confirm this order. But, it sure fits right in with what was brought to your attention in a MIDAS commentary last week:

August 28 - Gold $369.90 down $2.40 - Silver $5.11 down 4 cents

More on the physical market and the specs. I am more and more convinced there is a big play on in gold. BIG MONEY is going after the price-capping crooks. To win, this crowd must make their move in the physical market AND the futures market. It was a Mark Rich specialty years ago. Mark Rich is the legendary commodities trader pardoned by President Clinton. Only by supporting the cash market can the big specs prevent The Gold Cartel from flushing out the vulnerable specs, thereby creating an avalanche of selling. Each time the cabal forces try to take gold down, the BIG MONEY buys physical, then go after the futures. Since the cash market is firm anyway, it forces other cash buyers to step up their bid prices. Before you know it, gold is moving up again as local traders begin covering their day trade shorts, etc.

This does not always insure a Large Spec victory, but it is how the game is played in general and is what I see currently occurring in the gold pits. While just a speculation, I believe these big players know what GATA knows, and continues to broadcast all over the place. The Gold Cartel is running out of physical gold to continue their scam. They are gradually hitting the wall and a savvy group is going after them.

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