When you talk to junior mining companies who are trying to drum up money to fund their exploration, you'll frequently hear about how rosy the future looks: Prices can only go up, opportunity will only increase, and the economy can only get better.

But not everyone shares that perspective. At the recent Cambridge House World Resource Investment Conference in Vancouver, we spoke to three members of the Gold Anti-Trust Action Committee (GATA): Bill Murphy, Chairman, Chris Powell, Secretary/Treasurer, and Ed Steer, member.

We opened the conversation with Bill Murphy by finding out more about their contribution at the conference. Mr. Murphy told us: "One of our feature talks at this conference was covering the presentation we gave in front of the Commodities and Futures Trading Commission (CFTC) on March 25th, 2010."

He has quite a story to tell about that March 25th presentation and he gave us a brief synopsis of it here: "We had a whistleblower, who was communicating with the CFTC, but they wouldn't let him testify. So the whistleblower gave his materials to us and we laid it all out for them. It created quite the stir."

The stir, Mr. Murphy believes, wasn't just the reaction he received. He believes there was a far darker agenda that took place behind the scenes: "The CFTC must have been concerned about something [we presented from the whistleblower] because my video feed went out when I was making a presentation – and I was the only one who was blacked out at the conference. Then the whistleblower and his wife were hit by a car the very next day; there was a high speed car chase and a helicopter chase. Now [the whistleblower] thinks someone tried to assassinate him. It's quite a story and it's gaining a lot of steam."

If this situation is, indeed, as dark as Mr. Murphy believes, it begs the question: What was the information that GATA was presenting from the whistleblower?

Mr. Murphy answered: "[The whistleblower] is ex-Goldman Sachs and he knew the traders at JP Morgan and Chase and other traders. All these traders would raid the market in a coordinated fashion. Everybody would know about [a piece of news or information] at the same time. The word would go out and the market would collapse and the whistleblower was sick and tired of it because a lot of people were getting hurt."

It runs deeper than simply some traders at leading trading houses, asserts Mr. Murphy. "We also believe the US government is part of this operation to some degree. It's in their interest to keep the price of gold and silver down… and they got caught big time! If we're correct, this is going to escalate to much bigger things in the weeks and months ahead."

Next, we spoke to Chris Powell to elaborate on what Mr. Murphy said, particularly about gold and its impact on currencies. "Gold is a competitive currency," said Mr. Powell, "It competes with all of the other currencies in the world and it has a huge impact on the value of government currencies and particularly a huge impact on interest rates. Governments try to support their currencies and support the price of government bonds." If gold is so important, it's not a surprise that governments want to monitor and even manage the price of gold. So we asked Mr. Powell how governments are doing this. "They're issuing so much new debt," he said. "The purpose of this current gold price pressure scheme is to keep currency values up and interest rates down. Governments don't really care for gold for gold's sake; they care desperately about gold's overwhelming influence on the value of currencies and the price of government bonds."

Ed Steer spoke next, giving us a brief review of the situation and telling us what we can expect in the future. "If you look at the whole scheme over the last couple of generations – since Nixon – we've been in a fiat monetary system ever since and governments have been propping up markets (like interest rates and bonds) since the 1987 market melt-down." That may not come as a surprise to some people, but the results will shock many. Mr. Steer explained: "Now we're getting down to a situation where the Lehman Brothers and a lot of other banks (like AIG) were run up onto the rocks. Now we have a sovereign debt crisis… and a sovereign debt crisis is the absolute end of the line… and it's all going to end very badly. The fiat currency system, the economic system, and the financial system as we know it today is going to come crashing down one way or another... and the end is now in sight."

Those are dire warnings and Mr. Steer continued with his explanation of what GATA believes will happen: "We're going to have a deflationary implosion or we're going to have a hyperinflationary depression," said Mr. Steer. "The deficit sides of the banks’ balance sheets are filled with red ink. The only way they can get out of the situation is to re-price the gold they allegedly have in their vaults and re-price it at such a price as to bring up the asset side of their ledger. If they decide they're going to do that, then things will change pretty quickly.

We wondered how much of this has already been happening and how likely Mr. Steer's scenario would play out. He said: "The government has been printing money and rigging markets for years. The main government response the last couple of years has been market manipulation, so these hideous disparities don't show up where people can see them. I don't know what is going to be the breaking point; it may very well be uncontrollable gold and silver prices, but at some point people are going to realize how they've been deceived, and how the manipulation has given them false prices in all sorts of markets and I think they're going to rebel against it. I've said it before: There really aren't any markets any more, just interventions. When people realize this the world will change."

Bill Murphy wrapped up our brief interview with some concluding warnings: "It's a very exciting time right now because the physical gold and silver markets are on fire and the gold cartel is running out of ways to meet demand all over the world," he said. "We believe it's going to blow up, but the way things are right now, it could be quite traumatic. Many people think that gold is expensive now but I think we're in the second inning of a nine inning game. I think you're going to see $5,000 an ounce or more. It will be very dramatic."

There is always the possibility that GATA is wrong and that markets will recover and get us back to a point of "normalcy" that we've come to expect in the past. However, if GATA is correct, only those who have heeded their warning and acted appropriately will weather that cataclysm.

Reference

Gold Anti-Trust Action Committee

http://gata.org