U.S. Rep. Ron Paul, R-Texas, a candidate for the Republican presidential nomination, has told journalist Peter Brimelow that the central banks are manipulating the gold market and all sorts of markets besides.

Paul’s comments came in an interview given in New Hampshire last month and posted today at VDare.com, the Internet site of an immigration law reform organization for which Brimelow is editor.

So the gold manipulation issue has broken into national politics…


This is off-topic, but what do you think about China’s pegged exchange rate?

Paul: Well it would be better if it was just determined by the market. But it’s wrong for us to tell them what to do. Why should we badger them and say we want you to have a stronger yuan, which weakens our dollar.

Because that’s how a fixed exchange rate-Bretton Woods-type system works, isn’t it? You have to argue about exchange rates because there is no free market. To put it another way, how are you feeling about gold at the moment?

Paul: Gold? Well I think gold is real money, and I think ultimately real money wins out in the end. It too is being manipulated, just like all the other currencies.

You think the gold price is being manipulated?

Paul: By the central banks. When I first started watching gold in the 1950s and1960s, the central banks manipulated the gold price every single day. Because they dumped nearly 500 million ounces, two-thirds of our gold, at $35 an ounce, to try to pretend our dollar was stronger than it really was.

Now they do it in a more sophisticated manner. A lot of central banks have been involved in lending gold and moving it out of the market. I’m sure they’re involved in the futures market. You see these prices, when common sense would tell you—well, you know—why isn’t the price of gold going up? Then you see an announcement, oh, Italy’s dumping 800 tons of gold—

It seems to me this brings up a lot of liability issues. If the authorities are involved in surreptitious intervention, there’s lots of opportunity for insider trading.

Paul: Oh yeah, yeah—deceiving the public at the same time there are people making profits on this as well.

Nobody knows how much gold we have right now—whether they moved it or loaned it. Those are big issues we’re in the dark on. We’re in the dark on what our CIA does, we’re in the dark about monetary manipulators. And it would be probably interesting to know exactly what the President’s Working Group On Financial Markets says—what their conversations were with the central banks, what they said to China—because China has some similar interests to us. They don’t want the dollar to crash either! They have to say stuff publicly for their people, and we say stuff publicly for our people.

And the real manipulators are talking behind the scenes.