A
Small Victory
About seven years ago, my best friend approached me after
church in a very secretive fashion to tell me about some of his investment
strategies.
Bob was an amazing man. He lived by the Book but loved to find legal ways to
enhance his family’s lifestyle. Bartering was second nature to him. What
cash he needed usually came through his wife’s paycheck or the remnants of
a jewelry business he had disposed of some time back.
Since we were such good friends, he wanted me to know his
concerns about the shape of the U.S. economy and what he had done to protect
his family against what he perceived would be the final outcome of a massive
stock market bubble. Bob had invested significant funds in gold stocks.
He encouraged me to do the same.
We both waited for our investments to produce the
substantial returns we were expecting. 3 ½ years ago, Bob ran out of time.
He keeled over dead of a heart attack at the kitchen table one Saturday
night.
I am still waiting for the gold bonanza.
Don’t get me wrong. There are opportunities to win or lose
big in precious metals, even when the price of gold is kept within a narrow
trading range. This year alone, when most 401-K stock funds are down 20 to
30 percent, most gold funds are up about 25 percent.
But the one thing preventing a massive new 21st
Century gold rush has been a consistent downward pressure on the price of
gold that defies description in natural terms. Only external manipulation
could keep the price of gold and the Dow Jones average virtually steady
after such a disaster as the destruction of the World Trade Center towers.
The patterns were obvious three or four years ago. Central
banks around the world were selling off their gold reserves. Large brokerage
firms were taking out loans against gold that allowed them interest rates of
1 and 2 percent. The funds were funneled into dot coms and high tech firms
and the stock market soared.
But in order for the scheme to continue without massive
losses for the manipulators, the price of gold had to remain depressed at
all costs.
The frustrations for gold investors mounted until one day, a
small group of litigants with insight and some cash reserves of their own
decided to mount a challenge to the captains of Wall Street. And so, the
Gold Anti-Trust Action Committee was born. After months of gathering
evidence, GATA filed suit against J.P. Morgan and other brokerage firms,
Alan Greenspan of Federal Reserve fame and the Bank for International
Settlements, just to name a few.
When the suit was filed, not even very many goldbugs gave it
much of a chance. Bill Murphy and his band were going up against the most
powerful men in the world. The chances of finding a judge who would give the
case an honest listen were thought to range from slim to none.
As soon as the case was brought, federal attorneys filed a
motion to dismiss. That hearing occurred Monday at a courthouse in Boston
and the outcome surprised us all.
Rather than find some arcane reason to throw out the GATA
lawsuit, the judge listened to the arguments from the battery of nine
attorneys representing big government and big business…and the case
presented by GATA’s one barrister, Reginald Howe.
Two minor counts against J.P. Morgan were tossed out…but
the majority of Howe’s allegations were taken under advisement for further
consideration by the court. It may be weeks or months before the judge
issues a ruling allowing discovery to proceed in the case.
If the judge issues such an unprecedented order, the wraps
will be taken off an inherently corrupt financial system that has allowed
the government to pump billions of our federal tax dollars into propping up
the stock market, artificially manipulating the value of securities for
financial gain and political goodwill.
Countries around the world will see how this effort to shore
up the dollar has hurt the value of their currencies and negatively impacted
the lives of those who risk their existence underground every day, digging
up precious metals for a mere pittance.
Once it’s proven that the emperor has no clothes, we might
actually see the price of gold and silver set free to find their own fair
market value. At last, those of us who have invested our life savings in
this sector may realize the rewards that our insight and patience have
earned us.
This will not be an easy fight. Those who control the world
economy can run the printing presses at will and can also bring other, less
obvious, pressures to bear. Pressures that can be worn, concealed in a
shoulder holster…or worse.
But those who love truth have decided not to "go gentle
into that good night." For that, Bill Murphy, Reg Howe and his stalwart
group of fighters are to be commended.
We’ll keep an eye on this story and bring you further
developments as they happen.
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