Lelde Smits: Jim, one of the most striking developments since we last spoke on Sydney’s harbor in October last year  is the gold price, which has since shed about 30 per cent. What do you believe prompted the plunge?
Jim Rickards: There are probably a number of things going on, not just one thing. I would expect that there is some central bank price manipulation. We know that this goes on, this is not speculation, it is actually disclosed in certain ways.
You know, whenever you are trying to solve a crime you say, ‘Who has the motive?’. The person with the greatest motive to keep the price of gold low is actually China, because they have the most to buy. So, people point the finger at the Fed, but you might suspect China, but also hedge funds are involved.
Traditionally hedge funds were not very involved in gold, they are now. Hedge funds don’t care if they trade gold or base ball cards, for them it is all about making money. And, they engage in manipulation. And, the enforcement side in the United States is very weak right now, so it’s almost an invitation for hedge funds to come in and play games.
China and Russia are building gold stockpiles. Some think they will create a gold backed currency and put the dollar out of business. U S might have to back the dollar with gold, would be the end of money printing!!
Secret currency traders' club devised biggest market's rates
It’s 20 minutes before 4 p.m. in London and currency traders’ screens are blinking red and green. Some dealers have as many as 50 chat rooms crowded onto four monitors arrayed in front of them like shields. Messages from salespeople and clients appear, get pushed up by new ones and vanish from view. Orders are barked through squawk boxes.
This is the closing “fix,” the thin slice of the day when foreign-exchange traders buy and sell billions of dollars of currency in the largely unregulated $5.3-trillion-a-day foreign-exchange market, the biggest in the world by volume, according to the Bank for International Settlements. Their trades help set the benchmark WM/Reuters rates used to value more than $3.6 trillion of index funds held by pension holders, savers and money managers around the world.
Now regulators from Bern to Washington are examining evidence first reported by Bloomberg News in June that a small group of senior traders at big banks had something else on their screens: details of each others client orders. Sharing that information may have helped dealers at firms, including JPMorgan Chase & Co., Citigroup Inc., UBS AG and Barclays Plc, manipulate prices to maximize their own profits, according to five people with knowledge of the probes.
This is precisely the technique that JPMorgan et al are using in the precious metal price management scheme. They share each others client orders and can play the technical funds like a Stradivarius...right down to their last long contract if need be. But not only are "da boyz" managing it for big profits, they are also doing double duty by keeping precious metal prices under control. This is the operation that the CFTC has not been allowed to tamper with.
Bloomberg correspondents discuss gold's flight from London to Asia
The depletion of London gold warehouses by shipments to Swiss refineries where metal is recast for export to Asia was discussed by Bloomberg News correspondents yesterday on Bloomberg Television. The 2:53 minute segment is headlined "What's Happening to All the Gold?" and it was posted at the Bloomberg Internet site on Friday, December 13, which was a week ago