My Dear Friends,

The early morning operation took place today taking gold off the $1704 level. Many of us are convinced that what we are seeing has Federal assistance. That means to us that the Fed is lending gold to the gold banks to facilitate the operation. Because of that there is a fear of taking on the operation.

I got a call last evening from a friend in the huge private hedge managed money telling me that we have all been bamboozled. The size of hedge funds today can easily mimic what would be considered Federally sponsored. The Fed is quite pleased, but is not the infinite power behind the bear operation that started at $1800.

It is a wild man/women with very big, but not infinite funds that is operating the gold market. That which the longs fear is air, and nothing more than a major huge hedge fund operation.

It is certainly is worth considering. Apple is not off from $750 on its own power. Herbalife did not drop off its recent high without significant help.

In another life at 35 years old I did similar things on the long side. I used banks common then to the Middle East to run gold hard on the upside. I even hired an actor to dress up like a Saudi Sheik. I hired armed private guards. I hired a stretch limo. Nobody knew it was a spoof except the actor, myself and my partner . We arranged with the Comex to permit the armed guards on the floor. His instructions were to go to Mintz Marcus in the pit and in Arabic ask him how to turn this paper in for real gold. Then ask again in really bad english how do I turn my paper gold into real gold. You see, if anything was possible then, now it must be a circus in the use of beards (fake identity covers in buying and selling to influence the market).

This is business now where you must not believe your eyes. This is just something that should be considered as possible. It would be a genus move on the part of anyone wanting the gold market off from $1800. Plant the story in financial MSM that it is Federally backed selling, then do what major hedge funds do today – bet the ranch on infinite margin, and go for broke.

Part of me respects anyone with that much courage to do so.

Respectfully,
Jim