How apt it was when CBC screened a documentary about gold few days ago, after gold prices tumbled. Although it is rife with conspiracy theories, there must be more or less something brewing in the background for this documentary to be made. Below is the summary of the documentary. I have also embedded the videos in this post for your viewing.
Some facts about gold
- There is only 1 ounce of real gold for every 100 ounce traded in the financial markets
- For all the gold found and if we melt all of it, it is only enough to fill 3 Olympic size swimming pools
- Extraction of Gold from the ground has not changed in thousand of years. It takes 38 man-hours, 1,400 gallons of water, and litres of cyanite, to produce 1 ounce of fine gold.
- In South Africa, 400,000 men digging 2km deep with temperature greater than 130 degrees fahrenheit
Role of Gold in WWII
- Nazis invaded European countries for gold. France tried to evacuate gold to Canada and U.S. but some ships were sank by German submarines.
- Britain also wanted to store their gold and silver in Canada. The first cargo worthed US$9.9 billion. Britain also paid gold to US for military equipment.
- Gold were taken from the Jews during the Holocaust.
- Odyssey Marine explores the ocean bed for ship wrecks. Estimated 3 million ship wrecks or billions of dollars worth of gold and silver.
- 2007 – Odyssey found 600,000 gold and silver coins worth US$500m near Portugal.
Gold and silver prices are manipulated
- The speed of electronic trading can go to 400 contracts in 1 second with each contract worth 5,000 ounces of silver.
- At one instance, the market was dumping 45,000 contracts. After the price dived, US$3.8 billion worth of buy orders came in. It was believed to be traders from JP Morgan and HSBC.
Where is the gold?
- Western Governments rent out their gold bullions to bullion banks. Banks sell them to make jewelleries. Governments still keep the gold in their books. On the other hand, Governments in the East are buying.
- President Roosevelt bought back the gold at US$35 per ounce and melted into bullions and stored in Fort Knox. However, there is no audit since 1954 and it is better to assume the gold is not there.
- Bundesbank cannot get their gold back which are ‘stored’ in New York.
- Canadian government had sold their gold reserves in the past 30 years.
- Gold is a guarantee for sovereignty.
- Morgan Stanley did not have the physical gold and silver which the clients bought.
[Free Ebook] How should you invest your first $20,000?
We asked 14 Singapore finance bloggers to share what they would do if they could go back in time and invest their first $20,000. They can no longer rewind time, but you can learn from their experience and hopefully start with a better footing.