Secretary/Treasurer, GATA 
March 29, 2011 Dear Friend of GATA and Gold (and Silver):
Thanks to Zero Hedge’s pseudonymous Tyler Durden tonight for unearthing the long statement submitted this month by World Gold Council CEO Aram Shishmanian to the U.S. Commodity Futures Trading Commission in opposition to the commission’s proposal to impose limits on traders’ positions in the precious metals futures markets:
The council’s objection to position limits involves to a great extent their potential to interfere with the derivative instruments that have diverted monetary demand for gold away from real metal and into paper promises of metal that suppress gold’s price but can’t be fulfilled, and the potential for position limits to interfere with hedging by gold miners, another price-suppressive practice.
In essence, the council’s statement is a defense of an unlimited supply of paper gold issued by the several big international banks that control the gold and silver markets, paper gold being the enemy of real metal priced in a free market as well as the enemy of accountability for government currencies.
Shishmanian tells the CFTC:
“The current proposed definition of ‘deliverable supply’ includes the quantity of the commodity meeting a contract’s delivery specifications that a market participant could, with ‘prudent planning,’ procure during the relevant time period from available local supply, deliverable non-local supply, and comparable supply (based on factors such as product and location). The World Gold Council believes that the CFTC should update its definition of ‘deliverable supply’ to account for changes in the commodity markets over the last 20 years which have increased the complexities and products within the commodity markets.
“For example, ‘exchanges for related positions’ (‘EFRPs’) are transactions used by market participants in the futures exchanges to accommodate more flexible settlement options for physically settled commodity transactions. An EFRP consists of two discrete but related simultaneous transactions. One party to the EFRP must be the buyer of (or the holder of the long market exposure associated with) the related position and the seller of the corresponding exchange contract. The other party to the EFRP must be the seller of (or the holder of the short market exposure associated with) the related position and the buyer of the corresponding exchange contract. The related position (cash, OTC swap, OTC option, or other OTC derivative) must involve the commodity underlying the exchange contract, or must be a derivative, byproduct, or related product of such commodity that has a reasonable degree of price correlation to the commodity underlying the exchange contract.