Eric King:  “Inside that piece (“The Secret World of Gold”) you talked about gold leasing and the mechanics of that.  Jim Sinclair wanted me to bring that up to you, the gold leasing, the mechanics of it, can you talk about that?”

Maguire:  “We did a piece on King World News about it, about the LBMA bullion bank default.  Stepping back, how did they get to such a mismatched (trading) position where they had so little gold and silver in their inventory to be able to back up people coming and asking for their gold and silver?  They never anticipated that this would happen....

Continue reading the Andrew Maguire interview below...


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“But what had happened was, over the years, basically what you would do is you would sell gold, sell silver, financed almost for nothing, take that money and invest it.  Then, obviously incentive was there because it had built up to such a large (short) position, they were so over-collateralized, that it was important to defend the price (of gold and silver) from rising because they didn’t actually have the physical.

What’s happened now is they are in a position where that leased gold is being asked for and they don’t have it.  I know of a very large client who actually turned up for his bullion, was refused his bullion, and told he would be settled in cash.  I felt I should go public with that (on KWN).

...(ABN AMRO) really was the tip of the iceberg.  What happened was that we saw that first bullion bank create the first visible default of the LBMA fractional reserve system.  I hear of other clients who are now panicking, and what happens?  You get an official intervention.  That’s what it (the takedown in gold and silver) was all about.”

Eric King:  “Andrew, you were getting contacted by people all over the world after KWN did the interview with you regarding the LBMA default situation.”

Maguire:  “I must say I had some really distressed emails.  What they were asking is, ‘What should I do?’  All I could say to them is, ‘If I had physical stored in any bullion bank related warehouse, whether it be COMEX or LBMA, I would remove it right now.’

We all know that ‘default’ will not be called a ‘default.’  It will be settled with cash.  I do not believe for a minute that the Fed can’t print a few billion (dollars), whatever it costs, to bail out the bullion banks for cash.  Why wouldn’t they just bail them out with cash?  It’s just an electronic keystroke.  People will be sitting on the sidelines and they will not get any physical (gold).” 

Maguire also added:  “It’s been several years since I’ve taken any delivery from the COMEX, or any of my clients have.  But I do remember on those prior occasions it was already difficult to get your physical out. 

Arranging to actually have the audacity to back up a Brinks truck to the COMEX warehouse door, it just incurred every defensive tactic you can imagine.  There were unreturned phone calls.  There were questions as to, ‘Why do you want this physical?’

That was a few years ago, so just imagine how many more obstacles there are now.  And obviously we are at the point of a critical default unfolding, so I would think think it’s going to be difficult to get your physical out now.”

IMPORTANT - Andrew Maguire has an absolutely incredible trading service.  For those who would like to get more information and sign up you can do so by CLICKING HERE.

This is part II of a two part written interview series and it is only a small portion of what Maguire had to say in his extraordinary audio interview.  The KWN audio interview with Andrew Maguire is available now and you can listen to it by CLICKING HERE. 

© 2013 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

The audio interviews with Gerald Celente, Andrew Maguire, William Kaye, Rick Rule, Nigel Farage, Dr. Paul Craig Roberts, John Embry, Art Cashin, John Mauldin and Egon von Greyerz are available now.  Also, be sure to hear the other recent KWN interviews which include Eric Sprott, Marc Faber and Felix Zulauf by CLICKING HERE.

Eric King

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© 2013 by King World News®. All Rights Reserved. This material may not be published, broadcast,

rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

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