Gold – is the ceiling showing cracks?

It has even been explained why this objective should be so desirable – after all, if gold is dead, or at least merely another commodity, why should it be necessary to go to all this trouble and risk all kinds of public opinion mayhem if at any time these activities happen to be revealed?

But gold is not dead and the people with concerned the manipulation are very much aware of the fact. They know that if they want to succeed in their primary objectives – among which are to keep inflation (or at least awareness of inflation) low, to keep the dollar firm and thereby to keep the US economy afloat despite a horrendous and rising trade deficit, both of which in turn help to maintain low interest rates and thereby keep the credit bubble in the US from imploding, apart from other benefits all around the globe – then gold must not be allowed to break loose and set off for what should be its current level now, 20 years and more after reaching 0 in the last uncertain, hectic and post-inflationary days of the Carter presidency.

When Bush was elected as the new US president many of the signs that matters were coming to a head and that very difficult times lay ahead for the US economy had already appeared on the walls, ably interpreted by those economists who had not swallowed all the hype about a “New Economy” that need to comply with the age-old rules that dictated how supply and demand operated throughout a large economy. He therefore faced two choices – either to reveal how the policies of the Clinton era were designed to create an artificial appearance of wealth and thus keep the Democrats in power, while actually ruining the economy from within – like termites that hollow out the trunk of a tree until it suddenly collapses – or, alternatively, to follow the same policies in the hope that he could keep the farce going long enough to be himself re-elected in 2004.

During the first few months of the Bush presidency there were numerous announcements that the economy was facing ruin and it was all the fault of the previous administration. Then these references suddenly ceased and it became clear that the Bush administration was going to perpetuate the follies of his predecessor. Events at the WTC came to their assistance in that they could more openly and more determinedly act in support of those factors essential to the well-being of America: Wall Street should not fall; the dollar should remain strong; interest rates should remain low; spending should remain high and, if consumers won’t spend then the government will do so.

Until quite recently this has worked. Not all that well, but sufficiently so. But now things are unraveling; Wall Street is battling to keep the Dow Jones above 10 000 points; the dollar has just shown over the past week that it can be vulnerable and – as happens in a world of predators, be it the African bush or the money halls of London, New York and elsewhere – it can be expected that the financial lions and the hyenas and vultures will gather to exploit that weakness until a feeding frenzy develops.

It may not happen this coming week, or even the next. The vested interest in the US and their friends have tremendous power, but the fact that they are beginning to slip – with gold and with the dollar and perhaps even with Wall Street – show that they are no longer in full control. Perhaps they are weakening, or perhaps the powers ranged against them have gathered strength. Yet they can still come back to retrieve what they can before all is lost. But can they do so again and again?

It seems merely a matter of time now – weeks, if not just a few months. Then something will give – gold could break loose to cut the ground from under the feet of the dollar; there could be upwards pressure on US interest rates; Wall Street could sell-off in reaction to some very unsavoury piece of news from one of the Dow giants; or some foreigners may decide to abandon what is becoming to look like a ship in trouble while the going is still good.

Any of a number of events or developments could trigger a whole circle of domino’s just waiting for the first one to go.

Watch the gold price. Watch the dollar. Watch Wall Street. And keep an eye on US bond and interest rates. Who knows, it might even be this week.