Gold has changed overnight, and likely will again by Chris Powell

GATA isn't an investment adviser but rather, as a matter of law, a non-profit educational and civil rights organization incorporated in Delaware and recognized as federally tax-exempt by the U.S. Internal Revenue Service. As a more practical matter we aspire to be a sort of liberation movement, since, as was written in ancient times, the truth makes you free. We don't know exactly when this will happen.

Insofar as the price of gold is an international political decision as much as a market decision, we particularly do not know when crucial political decisions affecting the gold price will be made. But they have been made before, they will be made again, and we are seeing now so many developments that correspond to the developments immediately preceding the last great revaluations of gold, in 1968 and 1971.

Back then, when gold price suppression was openly a big part of U.S. economic and foreign policy, gold moved from West to East -- particularly from the United States to Europe. Then came the collapse of the London Gold Pool and the Bretton Woods Agreement, when the U.S. government decided that the drain on its gold reserves caused by its policy of price suppression had become too great:

http://en.wikipedia.org/wiki/London_Gold_Pool

While gold price suppression is now a largely (but not entirely) surreptitious policy, once again we see gold flowing from West to East -- only now the East includes the rapidly developing countries of Asia. This flow has been tempered by the supply of imaginary gold conjured by derivatives, but it is a strong flow nevertheless.

At what point will the government or governments still supplying metal to the market for price suppression change policy to relieve the threat to what remains of their gold reserves? Will the U.S. government, as geopolitical analyst Jim Rickards has suggested, end the price suppression scheme by confiscating the gold reserves it holds in custody for other nations?

Maybe there are answers to those questions in the documents the Federal Reserve was able to withhold from GATA as a result of the decision last year in our somewhat successful freedom-of-information lawsuit against the Fed:

http://www.gata.org/node/9917

We don't know. But we do know from history that the biggest circumstances with gold, and thus gold's valuation, tend to change overnight, when all is revealed suddenly. The central bankers won't be calling us or you about this a day or two ahead of time. They'll be calling their agents at JPMorganChase and HSBC. All we can do is strive to hasten the day of change. And such days do happen, and have happened in times much like the ones we are experiencing now.