Gold’s Rise, Central Banks, & BRICS Influence - Chris Powell

I'm your host Craig Hemke and joining us for this month's Sprott Money Monthly Wrap-Up is my old friend Chris Powell. Chris, of course, the secretary and treasurer of the Gold Antitrust Action Committee. Been leading the fight for fair pricing of gold and silver for about 25 years now. And it's a pleasure to call him a friend. I know he's a good friend of Eric Sprout as well. Chris, good to see you.

Chris Powell (01:00)
Great to be with you, Craig.Again, on behalf of the everybody that collects precious metal and understands sound money, thank you to you and Bill Murphy for all of your efforts over the years. We stand on your shoulders trying to push this whole thing forward. gata, g-a-t-a dot org is the website, correct? Please, everybody go there and you get it. Is it just the U.S. where it's a tax-free deduction to support you guys?

Chris Powell (01:21)
That's right.

Yeah, we are a 501c3 tax exempt educational and civil rights foundation under the US tax codes. we're tax exempt and donations to God in the United States are federally tax exempt. Unfortunately, outside the United States, you're on your own.

Craig Hemke (01:50)
Just do it for your own goodwill. All right. Hey, and not only support Gata, please, but also support Sprott Money. are the people that provide all of this information all month long, all next month for that matter, all December and going forward. SprottMoney.com should always be on your mind whenever you're looking for physical precious metal. In fact, they take Bitcoin and Ethereum now too as payment. So if you want to...

swap out of some of your bitcoin over $70,000 for a bitcoin last night I saw. You can use that swap that into physical metal and any order over 500 bucks they will ship it to you and insure it for free. Sproutmoney.com or call them at 888-861-0775. All right Chris what a year we've had I know we're wrapping up the month before we get down to the I guess more granular level of what's taking place this month.

How about the whole year? How surprising has it been to you to see gold perform like this up over 30%, almost 35 % year to date?

Chris Powell (02:57)
Well, whenever anything good happens to the monetary metals, I'm surprised. What was the book title? But down so long, it looks like up to me. But, you know, given that the world is falling apart and there's, you know, many strategic divisions and, you know, alliances being built and changed, I suppose we shouldn't be too surprised. I think we've been expecting countries to

realized that the dollar and gold price suppression were the underpinnings of US imperialism in the world. And we figured that, you know, eventually even the dumbest countries would wake up to that. And they are waking up to that and they are slowly moving away from the dollar now and they are rapidly moving into gold and silver, the monetary metals, money without counterparty risk. And I think that trend is going to continue.

The recent BRICS meeting did not come up with a new reserve or a new trading currency, but as Jim Rickards wrote the other day, the BRICS system is going to incorporate gold in trading if only insofar as the BRICS countries will be inclined to use gold to balance any trade deficits they have among each other and that this will

continue to support the gold price as well as the Increasing central bank purchases for ordinary reserves. So what so the world is changing? I think the future for the monetary metals is is very bright As for the future for monetary metals investors in the United States What they're going to do to us if we ever get in a position of making any money well, I guess my

My only investment advice has been to find a safe planet to keep your monetary metals on and when you find it please call me.

Dope With A MacBook (05:02)
Let us all know. Do you think, again, is much of this related to that central bank accumulation that has been continuing at a record pace for the third year in a row?

Chris Powell (05:15)
I'm sure it is. The central banks have turned from net sellers and lenders of gold to very big net purchasers. That is going to put a floor under the gold price. think they are going to be buying the dips. think they're already buying the dips. Andrew Maguire, the London metals trader whose work is

broadcast by Kinnis's money has been showing us charts. So is James Turk showing us charts that gold seems to be advancing in a very orderly stair step pattern. I don't think that's a natural free market pattern. I think that is a pattern in which the people who are controlling or trying to influence the market are trying to make sure

that the gold price rise is, as the central bankers and the BIS people say, orderly. Rickards has long argued that central banks weren't so much objecting to a rise in the gold price, but to a disorderly rise in the gold price. Well, that's the thing about free markets. mean, free markets are orderly. They're not free.

Central banks don't like free markets. Really the major purpose of central banks is making sure there never are free markets anywhere, particularly not in the monetary metals. You go back to the speech given by William R. was then, William R. White was the head of the Economic and Monetary Department of the BIS back when was it, I think it was.

2010, something like that, he gave a speech to a BIS conference in Basel in which he said that one of the four major purposes of international central bank cooperation was to influence gold and asset prices in the foreign exchange markets in circumstances where he said this might be thought useful. know, central banks are

very sensitive to currency values and exchange rates and they rig the markets, they rig the currency markets. really especially at this time like to go back to the April 1974 meeting in Secretary of State Henry Kissinger's office. Kissinger was meeting with his, well what was the title, it was

Assistant Under Secretary for Economic and Business Affairs, Thomas O. Enders, who was from Connecticut, but I really wasn't familiar with him here. Enders was explaining to Kissinger why the United States had to prevent its Western European allies from returning gold to a bigger role in the financial system. Enders said that whoever has the most gold can change its price periodically.

and thereby change all financial values in the world. Enders called gold the reserve creating instrument. He said it was the dominant means of creating reserves. By reserves he meant money. And he said if the Europeans started exercising that power, because at that time they had collectively greater gold reserves than the United States did,

Dope With A MacBook (08:41)
Thank you.

Chris Powell (08:53)
they could start changing all the currency values and that would be terrible for the dollar. That really is one of the origin documents of gold price suppression. is telling Kissinger we have to rig the gold price because the gold price is the determinant of all other values and if you have the most gold you can change all financial valuations in the world. We can't let the Europeans do that. We have to be in charge of

That's still on the internet site of the historian of the State Department.

Dope With A MacBook (09:25)
So Chris, you know, remembering, you know, that that was just after the collapse of the London Gold Pool in the late 1960s and forcing the closure of the the gold window, that got disorderly or difficult to maintain that $35 an ounce peg. And that's, know, when that all broke down. Do you sense that that is on the doorstep of another event like that? And that this is pretty disorderly, too, to have a year where we're up 35 percent.

Chris Powell (09:55)
Listen, I suspect, and pretty strongly, that all the central banks are working together, including the US and the People's Bank of China and even the Bank of Russia, to arrange this stair-step increase in the gold price. Look, they're all members of the Bank for International Settlements in Basel. The directors of the BIFs meet every month. They have a secret meeting to which

You and I are not invited for obvious reasons. And as their former economic department head, William R. White said some years ago, one of the main objectives is to control asset prices, particularly the gold price. The US economist Lee Quentin's and

Paul Boratsky wrote a paper, I don't know, probably 15 years ago, it's on our internet site. They hypothesized, well, they said that gold bugs should stop complaining about gold price suppression, because they hypothesized that the real objective of central banking at that time was to control the gold price while the central banks reallocated

the world's gold reserves among themselves so that when it came time to devalue the US dollar and other government currencies, they could push the gold price way up to hedge themselves against the devaluation of their own currencies. And I think this is coming to pass right now. think Brodsky acquaintance were right.

Dope With A MacBook (11:42)
Yeah, I not thought of it that way but

Chris Powell (11:44)
Jan Niewenhuis, who's now writing for Money Metals Exchange, he's been a gold researcher for many years, done excellent work, particularly in regard to Chinese gold positions. He has reported recently about the European Central Banks that specifically have what they call their gold revaluation accounts. They're already prepared to revalue the gold price.

and to bring their books into solvency. Look back, geez, I think it was 20 years ago, Lyle Gramley, who was then a member of the Board of Governors of the Federal Reserve, gave an interview to Business News Network in Canada, which is now part of Bloomberg, in which he volunteered. Well, he was responding to complaints that the Federal Reserve's books now were making the Fed look more like a hedge fund than a central bank.

and gremley volunteered that the fed would be a lot more solvent if it ever revalued the gold certificates from the treasury it it then held the gold certificates for the u.s. gold reserve were valued at forty two dollars and twenty two cents an ounce there is still valued at that the gremley sitting member of the fed board of governors volunteered that maybe people shouldn't worry so much about the insolvency of the fed because the fed would be

you know, would be much more solvent if the gold certificates on its books were revalued to the market rate, which, you know, is then probably close to $1,000. Gold revaluation is very much in on the agenda of central banks. It's been there all the time. But, you know, mainstream financial organizations simply will pay no attention to it.

Dope With A MacBook (13:32)
.

Right, right. I would imagine most of this stuff you've been citing can be found, all the documentation right there on the gata.gata.org website, correct? I mean.

Chris Powell (13:44)
Yes, it's in the basics section. It's the top left side of our internet site. We've tried to compile in one place all the major documentation. A few years ago, I wrote a summary of it, which is in that basics section. And most of this stuff is, you know, it's statements by central bankers, it's documents on government archives, it's

It's public events that have happened, widely reported. It's all there out in the open, but it's prohibited knowledge.

Dope With A MacBook (14:20)
Right. Chris, in our remaining time, let's talk a little bit about the remaining 16 % of the year that we have in front. I can't believe this year's almost already over. I am excited the election's almost over, I can tell you that. Well, we're all gonna vote, let's put it that way. We'll see when it's actually over. That comes up next week. Also next week is the next FOMC meeting by the Fed, a day later than usual, Wednesday and Thursday of next week.

all sorts of data between now and then. The Fed told us at the last FOMC meeting to expect a 25 basis point rate cut in November and another one in December and three or four more next year. Do you see this as continuing to underpin the gold price as we go into the last couple of months of the year or how do you feel about where we stand at present?

Chris Powell (15:12)
Well, it's certainly an incentive for ordinary investors and hedge funds and wealth management companies to continue to grow their monetary metals positions. think in the big picture, the biggest reason for people to obtain gold and silver is the simple insolvency of Western governments. mean, here in the United States, all our politicians are

always brain about, we've got to spend more money on this, we got to spend more money on that. They run around passing out goodies. There's never any discussion of how it's going to be paid for. It's simply assumed we're going to, you know, borrow the money and, and, and, you know, create it, type it in. We're just going to complete, you know, continue increasing the, money supply. I did a little rudimentary calculation the other day, comparing the

federal budget against tax receipts that look to me like the U.S. government is spending 27 percent more money than it's taking in. Well, that 27 percent difference is being financed by, essentially, by money creation. That can't go on forever without even exploding inflation even more than it's been exploded in the last few years. This country's living far beyond its means, but then most of the Western democracies are, too.

you know the currency devaluation that is the the only way out and the only means of for ordinary people to protect themselves i think is this is what the monetary metals i think that i think the the government fiscal situations guarantee arising monetary metals prices because they guarantee more inflation currency devaluation

Dope With A MacBook (17:04)
Yeah, you're getting me to think I've done this a couple times now in the last month in interviews where I'm being interviewed. and I know you'll like this. I have this handy gold, it's not a real gold bar, right? It's a piggy bank. So don't come breaking in my window and I mean, you can have it.

Chris Powell (17:22)
I've got one too, in fact my camera right here is resting on one from Cambridge House.

Dope With A MacBook (17:26)
There you go. So this is a standard form London good delivery bar that most people have seen this kind of brick like this are usually on pallets. When Nixon closed the gold window you could have had one of these for about $14,000. When you started Gata in the late 90s it would have cost about 110,000 US dollars to have one of these and now with gold at over $2,700 an ounce we're talking what 1.1 million dollars.

acquire one these. has this thing changed? Is there? Yeah. Yeah. There's no hedonic adjustment that has made this more efficient or anything so we can say that it no. It's the same bar for crying out loud. Right. And I think if anything makes the point and this is even under the scheme the the current fractional reserve pricing scheme

Chris Powell (17:57)
Of course not, it just sat there while the world went to hell.

But it's not the same money.

Dope With A MacBook (18:20)
that you and I have been deriding for years and that you've done all the research on, know, the banks and central banks and government support that scheme. still have seen gold price rise that much. It makes you wonder what will happen when the scheme finally fails. I don't know if we're getting close. I don't know if you suspect we're getting close, but I would imagine this type of physical demand will continue to stress the system if it continues.

Chris Powell (18:45)
Yeah, listen, any central bank with a substantial foreign exchange surplus could have pulled the plug on the Western gold price suppression policy long ago simply by dumping treasuries and buying gold. know, Russia could pull the plug on it now. China could. Really, any country could do so. They know what's going on. In 2006, the deputy chairman of the Bank of Russia, Oleg Mazeskov, gave a speech.

to the summer meeting of the London Bullion Market Association at the Kopinski Hotel in Moscow. The only words he spoke in English were, gold antitrust action committee. And to the best of our knowledge, we'd never had any contact with anybody in Russia up to that time. Well, the Russians were watching us in 2006. They know what's going on. They could pull the plug on it right now. It's simply...

Dope With A MacBook (19:23)
and

Yeah.

Chris Powell (19:39)
simply sell everything for gold, just demand gold as payment for everything, but they're not prepared to do it. And I think at the bottom, there is still a good level of cooperation among all major central banks, just as there was some cooperation among them during World War II. And where was that cooperation conducted? It was conducted in Basel, Switzerland, at the offices of the Bank for International Settlements.

Dope With A MacBook (20:08)
imagine that. I agree with you and I think most people listen or understand that as well and I think a good closing note here is to understand that this whether it's a remodernization or a new understanding of the usefulness of gold and the role it plays in the financial system is coming there's still time for you to acquire some that's the thing.

that I think most people think, well, you know, look at how the price has moved up. Yeah, yeah. But there's still time to get, you can still actually get your hands on some. And that is a great way to protect yourself from this madness. And so please be sure to visit SprottMoney, SprottMoney.com and get yourself some metal. Add to your stack. They'll store it for you as well, safely and efficiently. So give them a call, 888-861-0775. Please also support

gata, g-a-t-a dot org, longtime friends of Eric Sprott and all of his efforts, longtime friends with Eric. And I know he just is so thankful for all that you and Bill have done over the years as well. So and I'm just very grateful for your time, my friend. Thank you for spending some time with me and wrapping up October and giving everybody kind of a historical background about where we are and where we think we're headed.

Chris Powell (21:33)
Greg, thanks for letting me harangue you and your audience. Or filibuster you, is the case,

Dope With A MacBook (21:36)
I just filibustered you for about the last two minutes of wrapping this up. Hey one last thing, we are heading into November. Remember there's all sorts of content coming from Sprout Money every single month. The best way you can make sure you don't miss any of it is to subscribe or like Sprout Money on whatever channel you've been watching or listening. Do us that favor and you won't miss out. For now we'll wrap up October. You and I, I'm looking at us. We don't need any Halloween masks do we? We can just go as old guys.

Chris Powell (21:42)
Ha ha ha.

Dope With A MacBook (22:06)
and go out and trick-or-treat. I hope you get all the candy you want. No bag of rocks.

Chris Powell (22:12)
Well, I don't need any more candy, but if somebody wanted to drop some silver coins off on the front stoop, I be very happy.

Dope With A MacBook (22:23)
I like that idea. Well, thank you, my friend. Always good to see you. And thank you, everybody, for watching. And again, keep an eye on this channel. We'll have a whole fresh batch of content for you coming next month.