Interview with GATA's, Bill Murphy

Interview with Bill Murphy of GATA, conducted by Ragnar Danneskjold, editor - Planetgold.com. E-mail Ragnar for questions or to suggest an interview at Ragnar@Planetgold.com

Planetgold: Today, Planetgold is pleased to interview Bill Murphy, of The Gold Anti-Trust Action Committee (www.GATA.org).

Planetgold: The Gold Anti-Trust Action Committee was organized in January 1999 as a Delaware corporation to advocate and undertake litigation against illegal collusion to control the price and supply of certain financial securities, particularly securities involving gold. The committee arose from essays by Bill Murphy, a financial commentator, and by Chris Powell, a newspaper editor in Connecticut, published at Murphy's Internet site, www.lemetropolecafe.com.

Murphy's essays reported evidence of collusion among financial institutions to control the price of gold. Powell, whose newspaper had been involved in antitrust litigation, replied with an essay proposing that gold interests should act on Murphy's essays by bringing suit against the financial institutions involved in the collusion against gold.

The response to these essays from gold interests throughout the world was so favorable that the committee was formed. Murphy is Chairman and Powell is Secretary/Treasurer.

The committee has retained a prominent anti-trust law firm, Berger & Montague of Philadelphia, and is raising money for advocacy and litigation.

Additionally, GATA seeks to disclose and publicize the huge speculative short positions in gold taken by financial institutions and bullion banks. GATA believes that 10,000 tons of gold or more have been sold short by these speculators, even as yearly mine supply of gold in 1998 was only 2,529 tons. When, through our lawsuit and otherwise, we are able to show how short in gold even one major financial institution really is, other institutions will buy gold in quantity, knowing the short position in gold is too large to close without causing a substantial rise in the price of gold. Then the gold collusion game will be over.

Murphy: I grew up in Glen Ridge, New Jersey. I’m a 1968 graduate of the School of Hotel Administration at Cornell University. I was Honorable Mention on the All-America Football team as a wide receiver. I was starting end for the Boston Patriots in 1968. I racked up 20 years on Wall Street in the futures industry. I started www.LeMetropoleCafe.com, a financial market website featuring gold analysis. I became chairman of the Gold Anti-Trust Action Committee in January of 1999.

Planetgold: What is the current status of the lawsuit you initiated against the gold price conspirators?

Murphy: The law suit against The Gold Cartel was dismissed on March 26 by Judge Lindsay of the Boston Federal Court. It was not dismissed on the merits of the case, but due to the judge's decision that Reg Howe, a former Boston trial lawyer, did not have the proper legal standing to bring the case forward. He hinted a gold mining company should do so.

Murphy: GATA is the creation of myself and Chris Powell (Treasurer/Secretary). He has a 2200 mailing list. Then there is the GATA ARMY out there that feeds us information, contacts the press, politicians, gold producers. That is why we are winning the day.

Planetgold: What evidence is there that a conspiracy to deflate gold prices exists?

Murphy: It is overwhelming and could fill a War and Peace type novel. According to the Royal Bank of Canada, which confirmed our claims, there is an unsustainable supply/demand imbalance and an unsustainable short position in gold. Central banks have ostensibly lent increasing amounts of gold to earn interest on their reserves. However, when one lends at a rate (less than 1% generally), the question arises as to whether there may be another motivation. As a rising gold price stands as a direct repudiation of their alleged responsible monetary policy, perhaps this is the real reason they have been so aggressive in this area. Bullion banks have borrowed gold from the central banks for their own accounts and those of various speculators, such as hedge funds and financial institutions (the carry trade) and for producers (mine hedging) and have used derivatives to limit their risks and generate additional income. The loaned gold has been sold into the physical market and is now in jewelry, primarily in the Middle East, India, and other parts of the Far East. The size of the short position, officially acknowledged to be more than 5,000 tonnes by the bullion bank apologists, is thought to be well over 10,000 tonnes and may exceed 15,000 tonnes. To put this in context, this constitutes between one-third and one-half of all central bank gold, and the vast majority of it is no longer accessible.

Other factors include the following unsustainable trends: low inflation, strong dollar and strong financial assets (stocks). This, coupled with the growing realization that gold is a better source of money, will drive gold prices through the roof.

Murphy: A great deal. We have alerted the world to the gold fraud and we have had a big impact influencing hedgers to reduce their forward sale positions.

Planetgold: So what's the next step? Will any other law suits be filed? What are the chances of success?

Murphy: What Reg Howe did was historic and magnificent, but the judge ruled the US Government was above the law. No lawyer will take that on. What is most likely to happen is the soaring price of gold (it is headed for $800 per ounce or more) will prove GATA right. There will be no other explanation. The gold industry mining analysts at the beginning of this year called for $285 gold this year and next for an average. Are they just stupid or hired guns to ONLY speak what their short bullion banks require them to do? What a scandal. Like Enron. For that matter, gold will melt up like Enron melted down. Many of the same players are involved in the same kind of scandal. They include Citibank and J.P. Morgan Chase.

Planetgold: You have done a good job of getting the word out, but what has to happen for the federal [un]reserve and the bullion banks to stop (or fail to) control gold prices? Why can't they just continue to sell short forever?

Murphy: Because they are running out of ammo. Our work says that they have lent out or swapped out 15,000 tonnes of gold, more than 3 times industry estimates. That means half of the gold in the central banks of the world is not there. The Russians, Chinese, Arabs and Japanese are buying while the dummy central banks sell at ridiculously low prices to perpetuate a fraud. The scandal, when all is known, will be bigger than Watergate for what it has done to the poor gold producing countries in sub-Saharan Africa.

Planetgold: What do you think will happen once the house of cards falls down? Obviously gold prices will sharply increase, but what effect will this have?

Murphy: The gold scandal is the mother of all scandals. The dollar will be bashed. Wall Street and the New York/Washington press will be discredited. Investors will flee the stock markets for a decade. There will be profound changes coming.

Planetgold: This question for Mr. Murphy is posed by one of the readers of Planet Gold, Jim Davidson:

"When will Congress hold hearings on the US Treasury sale of gold?
Article One, Section 9, paragraph 7 [of the U.S. Constitution] says, ‘No money shall be drawn from the treasury but in consequence of appropriations made by law’ and at the time that was written, gold was money. Gold continues to be money, so the drawings of gold from the US Treasury and the sale of gold by the US Treasury should only come in consequence of law made by Congress. It seems clear that much gold has been drawn from the US Treasury without any law from Congress. That suggests that the Treasurer of the United States may be due for impeachment. So, when will Congress hold hearings on the US Treasury sale of gold?”

Murphy: Congressmen Ron Paul of Texas and John Larson of Connecticut have a bill in Committee entitled, Monetary Reform and Accountability Act. It only says that if the Treasury Secretary or President want to deal in US gold they get Congressional approval. Treasury Secretary O'Neill is on the record as being against it even though the Treasury says they do not deal in gold. It stinks, the scandal, when it breaks, will be bigger than Watergate because of how many people the US gold policy has hurt around the world.

Planetgold: Are you afraid that government thugs may come over to GATA to shut you up? Have you been contacted by any government agency regarding your activities?

Murphy: Two years ago, I was beat up, my car was stolen and web site hacked. Since then, nothing. My esteemed friend, Frank Veneroso, who spoke at the GATA African Gold Summit on May 10, 2001, in Durban, SA will not talk about gold anymore in public. He is very afraid of what could happen to him.

Planetgold: This concludes our interview with Bill Murphy of the Gold Anti-Trust Action Committee. Feel free to browse previous interviews on this site and come back next week for Planet Gold’s next exciting interview. Also, sign up for our email notification service to be informed when Planet Gold publishes a new interview. If you have any questions regarding this interview or would like to suggest an interview, please contact Ragnar@Planetgold.com

I have been following the gold question for a while now and looking at the responses you got, I think most people don't even have a clue as to the significance of this article. Just today, 06-24-02, gold was heade to $328.00 per ounce which is consistent since the Euro was going to 98 cents, and while the currencies were still going up against the dollar all of a sudden gold went down to $323.60 even as currencies started advancing. Also, the markets were suddenly reversing from a reall bad Monday.

This is the gold cartel at work. The problem is that it is more and more ineffective at suppressing gold. Sooner or later the dam will crash.

any time the government distorts the markets, we aend up paying big for it.

When any nation buys gold from us, we just receive back our paper money or electron bits?

All fiat currencies are finally priced at their marginal cost of production. In the case of the Fed's notes which are classified as "legal tender", the value will be less than a penny eventually.

" What happened to the gold at Ft Knox ? .. Who knows, right? Nobody cares. "

It seems a variant of the game with a pea and 3 walnut shells. [ unless 007 really failed to thwart Goldfinger's plot ;-) ]

Whenever government imposes terms on economic transactions - whether through legal tender laws or minimum wages - the distortions inevitably imperil the wealth of the individual citizen and of the nation. And only the attentive have any hopes of escaping the carnage.

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