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As a part of a three part series GoldBroker’s CEO Fabrice Drouin Ristori will be asking the same market manipulation questions of Chris Powell, Egon Von Greyerz  and Jim Willie. Below is the interview with Chris via GoldBroker.com

Fabrice Drouin Ristori:How long can the manipulation of the precious metal markets last ?

Chris Powell: It can last as long as gold investors buy “paper” gold rather than real metal. The primary article of faith about gold is that it can’t be printed, but it CAN, insofar as “paper” gold can be printed to infinity. Gold investors who buy “paper” gold with the hope of price appreciation would do better to flush their money down the toilet. At least that way they’ll avoid commissions.

FDR: What will put an end to it –

CP: Probably only the discrediting of “paper” gold, or a futures market default.

FDR: What will be the signs proving that the manipulation is ending ?

CP: I doubt that we’ll get any signs, though maybe the decline in price of “paper” gold relative to the price of real metal is a sign of trouble for the manipulation. More likely the gold price suddenly will be reset to a much higher level that is more sustainable for manipulation by central banks with less drain on their gold reserves, at which point manipulation will resume at the higher level. I doubt that the manipulation will ever end, since, to preserve their power, governments probably always will try to rig the currency markets, and they’ll probably get away with it until investors around the world are far more informed than they are now.

FDR: Do you anticipate an overnight ending of the manipulation or a progressive process ?

CP: I think an overnight revaluation is more likely now. Of course currency revaluations are always done suddenly, aiming for surprise. No central banks are going to call us a few days in advance so we can arrange our portfolios for the greatest benefit. Only the investment banks that function as agents for central banks will get such calls.

FDR: Is the gold/silver paper spot price still relevant to value physical gold and silver ?

CP: It is if people really can find metal for purchase at the paper spot price. But the paper spot price may be losing some relevance as more shortages have been reported and there is rationing of gold and silver coins from government mints. Shortages and rationing are forms of higher pricing that don’t get included in nominal prices. Nominal prices are little use if the product isn’t available. But indeed, most gold-related assets are still taking their cues from the paper spot price and futures prices.

FDR: What direct consequences would a free gold/silver market have on people worldwide — not investors, people in general ?

CP: Free markets in the monetary metals would liberate markets and peoples generally, and reduce the power of governments and central banks, especially their power to control in secret the prices of all capital, labor, goods, and services in the world. Such liberation is really the objective of those who would expose the Western central bank gold price suppression scheme. We don’t really care what people use as money. We just want them to have options of valuation that are beyond the control of government. Here’s how von Mises put it: “It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of governments. Ideologically it belongs in the same class with political constitutions and bills of rights.”

Growth investing is about putting your money into companies you think will make greater profits in the future. It is usually considered the flip-side of value investing.

Most viable listed companies will grow profits over time, so a growth investor is looking for companies that are expanding their profits faster than rivals or the market.

Growth investors aim to make capital gains from a higher share price, as opposed to for example buying dividend paying shares for income.

The very best growth stocks can deliver returns of a hundredfold or more after decades of growth, although by definition only a tiny handful of the thousands of companies listed will ever reach blue chip status.

Most growth shares fizzle out long before they trouble the top of the index:

• Sometimes a growth company slows down to become just another staid performer (also known as going ‘ex-growth’). This outcome can still make you excellent returns if you got into the share early enough.

• Other would-be growth companies die trying.

• My personal bugbear is when growth companies are acquired when still young and with all their potential ahead of them. This happens quite often; if you can see the potential in a company, so can industry rivals.

Even when a growth share does go all the way from small cap growth stock to international giant, few investors stay aboard for the entire ride. Owning a successful growth share is a dizzying experience!

Growth investing is hard. Much more common than finding a Microsoft is buying a ‘jam tomorrow’ share, that promises much but never delivers.

This reached its zenith in the Dotcom boom, when companies were growing sales or market share but weren’t growing profits, or even making any money at all.

While all growth investors will inevitably put more emphasis on the business story and the potential for expansion than a value investor, sensible growth investors look at cashflow and return on capital employed to see how the company is multiplying their investment.

Finally, it’s worth noting that some investment greats like Warren Buffett and Peter Lynch argue it’s a mistake to think in terms of value or growth shares.

Buffett espouses the idea of ‘intrinsic value’ instead.

However as a convenient way of labelling an investing method that focusses on profit growth as opposed to value investing’s emphasis on under-rated assets or performance, the growth investing label is useful and here to stay.

The 2013 San Jose Bitcoin Conference has proven to be rather controversial. While it is considered to have been a success, being well attended and attracting high profile speakers, it has brought up a very divisive topic in the Bitcoin community…regulation.

In his presentation at the conference Peter Vessenes, the executive director of the Bitcoin Foundation, announced that the Foundation will be hiring a lobbyist saying “It’s time to engage with regulators and have a good, productive conversation.”

High profile investors Cameron and Tyler Winklevoss declared that “Cooperation [with regulators] is really the way forward.” And expressed that recent moves towards Bitcoin regulation are a good thing saying “FinCEN acknowledges virtual currencies. They’ve given guidance, which is a big step.”

There are many in the Bitcoin community who worry that close co-operation with regulators will destroy what Bitcoin is meant to be, free from political control and anonymous. Lifetime Member of the Foundation, Mike Gogulski, has even called for the disbandment of the Foundation.

Late last year Jon Matonis, also on the board of the Bitcoin Foundation, published an article entitled Bitcoins Greatness not Realized by Succumbing to Regulation.  In the piece he express concern that compliance with AML & KYC rules will link names to transactions and has the possibility of “cumulatively degrading the privacy of all bitcoin transactions.” Adding that …

Bitcoin’s great promise lies in its potential ability for both income and consumption anonymity. It is this feature alone that allows users to maintain the same financial privacy as physical cash today and it is this feature that will also lead to liberating advancements such as a thriving and interconnected System D, unhampered and undiluted freedom of speech, and superior asset management that can truly be said to be off-the-grid.

I tend to agree with Matonis. The idea that embracing regulation will actually work out for the Bitcoin community is a bit of a fairly tail. As he reminds us…

Those who support the antithetical overlay of  bitcoin on the current financial system ensure us that it will only be temporary and that we must build bridges. That would be nice but it’s a fairy tale. It reminds me of the Marxist theory of historical materialism and the Marx-Engels ideology that if we only tolerate the bourgeois state during the transitional advancement to a higher phase, we will see the complete “withering away of the state.”

I don’t see this as a political debate, or smart business management, or selling out, I see this through the lenses of power. Those who have it don’t like to lose it. Bitcoin and commercial banking/monetary policy are incompatible. Crypto-currencies threaten the government/banking cozzie power sharing deal and if you think they will give up power voluntarily you’ve got to stop dreaming about sailing the Caribbean in your new yacht and wake up.

As c-net reminds us co-operating with regulator didn’t work for e-gold.

that didn’t stop the E-Gold online payment system from being shut down after a federal indictment on charges of money laundering. Not only did E-Gold chairman Douglas Jackson interact with regulators, he even testified before the U.S. Congress a year before the indictment took place.

I can’t imagine that US regulators will stand by and let Bitcoin succeed. This isn’t crazy conspiracy stuff; this is basic theory on incentives and human behaviour.  All those regulators have mortgages to pay and friends to impress…they don’t want to be rendered irrelevant.

By Paul Rosenberg, FreemansPerspective.com

An increasing number of people have complained about governments and central banks in recent years, even using the word “tyranny” to describe them. They are, of course, called names in the establishment press: conspiracy theorists, mainly.

Calling someone a name, however, does not erase their argument (at least not among rational people) and both the governments and the big banks stand accused.

Up till now, however, these accusations were never accepted by the general public. The average guy really didn’t want to hear about the evils of government money. After all, that was the only thing he had ever used to buy food, clothes, gasoline, cars, and so on. He didn’t want to acknowledge the accusations because he feared what might happen to him without his usual money.

Now, however, we have a brand new currency (called Bitcoin) available to us: something radically different. This gives us a new way to directly address the subject of monetary tyranny, providing a clear test for the governments and money masters of the world:

If they are truly NOT tyrannical, they will leave this new currency alone.

If they ARE tyrannical, they will attack the new currency because it eats into their scam.

In other words, Bitcoin is a test for “the powers that be.” The way they deal with this new method of exchange will reveal their true nature.

If they ignore Bitcoin, they refute the charges of tyranny. If they attack it, they verify those charges.

After all, what honest reason could there be to attack an inherently peaceful tool for transferring value?

Prospective Reasons

Reasons to attack Bitcoin have recently appeared in the “public square.” Here are the three most popular ones, each followed with some analysis:

1. It can be used for money laundering.

Of course it can be used for money laundering — ANY currency can be used for money laundering. Currencies are neutral — that is their purpose! Currencies are valuable precisely because they can be exchanged for anything else — that’s why we use them!

Moreover, dollars and Euros and Pounds are used for money laundering every day. Consider the recent money laundering crimes of HSBC and Wachovia/Wells Fargo. These banks laundered hundreds of billions of dollars for violent drug cartels. And consider that this amount of laundered money is several hundred times the value of every Bitcoin in existence.

No one from either bank went to jail. Neither bank was shut down. Neither bank suffered more than a minor fine. So, how much of a concern can money laundering really be to governments and banks? Clearly not much.

But, since they accuse Bitcoin of being used for bad things, let’s be clear about the situation:

– Every mafioso uses government money.

– Every drug smuggler uses government money.

– Every terrorist uses government money.

– Every pornographer uses government money.

– Every criminal of every type uses government money.

They also use the telephone system and the mail and banks and a wide variety of government services. But government money is good and Bitcoin is bad?

The argument fails.

2. It could destabilize the current system.

A tiny, new currency is a threat to the long-established king of the hill? Comparing Bitcoin to dollars, Euros and Yen is like comparing an ant to a dinosaur. This is a threat?

Please understand also that no one is forcing anyone to use Bitcoin. If you don’t think it’s a great idea, you don’t have to use it. If its price movements (relative to dollars) bother you, you don’t have to use it. How is that destabilizing to the current system? It is entirely separate.

And what of the current system? It was falling apart on its own before the Bitcoin program was ever written. And I could go on at length on the insane levels of government debt, hundreds of trillions in derivatives, rehypothecation, and innocent people being forced to bail-out failed banks.

The current system has massive problems, but none of them can be blamed on Bitcoin.

This argument fails also.

3. Bitcoin provides no customer protection.

Well, no, it doesn’t. Bitcoin is a currency, not a legal system.

What is implied by this argument is that the government banking system does protect customers. That is an outright lie. People are ripped-off via the banking system every day. And more than that, consider what happened just a month ago in Cyprus: Thousands of innocent people were ripped-off BY the banking system — purposely — all at once and without recourse. This argument is, really, an insult to one’s intelligence.

And I should add something else: If Bitcoin is used properly, the crime of identity theft (a big problem with government money) vanishes — there is no identity available to be stolen.

So, again, the argument fails. Only those people who believe anything a government says will buy it.

In the End

In the end, it is said, we judge ourselves. Bitcoin has now put governments and banks in the position of judging themselves. They will write their own verdicts.

It should be interesting to watch.

The Electronic Frontier Foundation, which aims to defend “your rights in the digital world”, has announced that they will again accept Bitcoin donations.

Via the EFF website

Today, we’re happy to announce that we will be accepting Bitcoin donations through our website. You can use them to make one-time donations, set up monthly donations or get an EFF membership (which includes awesome membership swag like EFF hats and digital freedom t-shirts).

While we are accepting Bitcoin donations, EFF is not endorsing Bitcoin.  EFF does not typically endorse products or services, and we certainly do not endorse any of the electronic payment methods that we currently accept (credit cards, PayPal, and now BitPay).

The EFF stopped accepting Bitcoin donations two years ago. They give the reasons for the reversal of this decision as…

• “Censorship by payment intermediaries is an ongoing problem for free speech online – so it makes sense to start diversifying the available options.”
• “You can now give Bitcoins to EFF in the same way that you can give stock.”
• “Our research and FinCEN’s guidance removed a key risk to EFF.”
• “Our members keep politely asking for it.”