How GATA regulates the industryon June 19, 2011 at 21:34
The GATA (Gold Anti-Trust Action) committee was created back in 1999 with the aim to stop the illegal manipulation of gold prices. GATA in the meantime expanded their activities to put a stop to the illegal manipulation of the silver price, in addition to other prices. Essays were written by Bill Murphy, an economist, and Chris Powell, a newspaper editor, based in Connecticut in the United States.
The essays revealed that certain financial institutions were working together to keep the gold price lower than it actually was. Powell responded to these essays by suggesting that investors and gold mining concerns should bring about legal action against the perpetrators for the manipulation of the gold price.
GATA was then formed, as there was such a good response to these essays. Murphy and Powell headed up the committee with Powell assuming the role of secretary / treasurer and Murphy assuming the role of chairman.
GATA was the underwriter for the federal anti-trust lawsuit for the consultant Reginald H. Howe vs. Bank for International Settlements. This matter was heard in court in Boston during the period 2000-2002. Although this suit was lost on technical grounds, Blanchard Coin and Bullion’s anti-trust lawsuit used it as a model in their case. This matter was heard in 2002 in New Orleans. It was due to this suit that Barrick Gold ceased selling gold for the next decade.
Even today, GATA continues it work in preventing illegal activity of this kind from taking place. It champions the cause of free market in this type of trading. The U.S (IRS) Internal Revenue Service recognizes GATA as a civil rights organization that enjoys tax-free status. The IRS welcomes GATA as a player in the financial realm of investments.
GATA exposes financial institutions that speculate and create short positions in gold taken by bullion banks and financial institutions. GATA is of the opinion that in excess of 10,000 tons gold has been sold at less than what it is worth. This is shocking news as only 2500 tons of gold are supplied each year.
GATA works at revealing how the deficit between the supply and demand of gold is being filled due to the dishoarding central bank gold reserves. Investors buy the precious metal in the knowledge that it is impossible to close this gap without significantly causing the value of gold to rise thereby giving the value of gold a false value. Once this has been exposed then GATA declare that the plot has failed.
Investors should be thankful for organizations such as GATA. They keep the industry honest and prevent hard working investors from losing their money due to unscrupulous acts of crooked investors. Trading should be done in a way that is safe for everyone and in a way that keeps the playing fields level for all investors. If investors suspect that there is foul play taking place then they should pass this information onto the relevant authorities. By working together, investors can help keep the industry clean.