Gold Discussion for Investors and Market Analysts

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Steve Puetz
(Sun Jun 15 1997 00:03)
@ ark
Smarter than me. I haven't owned a stock in 15 years!!!

(Sun Jun 15 1997 00:05)
Ark: It may not mean the same right now; but how did you look at the decision last summer about this time? Or how about earlier this year? It probably seemed more reasonable then. All decisions, once made, become history, instantly. Better to agonize over the next decision to be made rather than over those no longer valid. .... Besides, reentry is still an option; isn't it? I'm sure they'd be happy to take your money. ..... ( :- ) )

(Sun Jun 15 1997 00:09)
Steve P.: I can recall many times in the last 15 years that I regretted not making your aquaitance sooner. ...... ( :- ) )

(Sun Jun 15 1997 00:20)
Earl: I weighed it after hearin from ya and yer right...only 25 pounds...don't know where I came up with the 40 thingy...It IS called "Monster Maul"...ugly piece of orange metal...My saw of ten+ years is also a Stihl...also have a small electric Stihl fer carpentry work.....
Had a Jonsereds before...

(Sun Jun 15 1997 00:25)
Hi stock in 15 years...too bad fer you!...where the Hell ya been????...

(Sun Jun 15 1997 00:47)
George S. Cole Thanks for the update on Justin Mamis eight hours ago! I am really getting delayed! Just finished siding so Steve Puetz, I will paint no more! Steve, hope you were painting a *picture* of your house, the only kind of house painting I can stand.

(Sun Jun 15 1997 00:48)
This report, which recently came in my mail, may be of interest:

NYMEX palladium ended higher again Friday as the physical platinum
group metals market continued to suffer an acute shortage of metal,
but COMEX gold and silver ended lower, with the latest U.S.
economic data showing inflation remains no threat to investors. "I
like the PGM group and it may be time to get long again on any
further dips, depending on news on Russian exports," said Scott
Meyers, an analyst with Pioneer Futures here.

Spot platinum prices are up about 50 pct this year and palladium
prices have doubled, due to the suspension of Russian exports for
five months. Russia supplies about 20 pct of the world's platinum
and 60 pct of its palladium. Russian PGM exports are expected to
resume in late June.

But reports Friday indicated the officially secret Russian export
quota for platinum in 1997 would be about 700,00 ounces ( 22
tonnes ) , down from the 1.2 million ounces exported in 1996,
according to an estimate by refiners Johnson Matthey last month.

The Russian export quota for palladium this year is to be 3.2
million ounces ( 100 tonnes ) , newswire reports said. Johnson Matthey
estimated Russia exported 4.6 million ounces last year. "The bottom
line is world inventories have been seriously run down without
Russian exports and the vaults in Zurich are not going to be
quickly refilled," one analyst said.

Meanwhile, one-month palladium lease rates rose back over 150 pct
in the physical market Friday, while one year lease rates were
quoted around 60 percent. The acute shortage of PGMs in physical
market has begun hit consumers like automotive catalytic converter
manufacturers and dental supply companies.

Many manufacturers lowered inventories of physical metals in recent
years, to raise cash, and leased their stockpiles back from dealers
in return for buying through those dealers in the spot market as
their needs arose, traders said. But many of these leases are now
being called in as dealers have to meet other commitments, traders

(Sun Jun 15 1997 00:56)
Steve: Thanks for the post on CB gold - it confirms my thinking

(Sun Jun 15 1997 01:03)
Vieserre: Took a wild ride on platinum's back many years ago and am kicking myself that I didn't jump back on at the start of the year, when I was considering the funds ain't available.....all tied up in ABX...Platinum+Palladium still sound like a good bet!

(Sun Jun 15 1997 01:10)
Steve Puetz - It's not how much the CBs sell, it's when they choose to sell. I have a firm belief that over $400 is too high for CBs. Only a very powerful rally can break through that barrier for long. Remember the equation they want to sell to the world: SG=SC. Stable gold equals stable currency. This is the mantra these self inflated, megalomaniacal demi-gods chant to themselves every morning just after they kick the dog, and just before they lower steel toed boots on their fellow man. There will be little forgiveness for these wretched souls as they are sure to be the first up against the wall when the revolution comes.

Megalomaniacal Demi-God
(Sun Jun 15 1997 01:18)
RJ: Up against the wall dude....

(Sun Jun 15 1997 01:31)
RJ: I just love it when you talk violent. From Bill and Hilliary's era: "UP against the wall ------ ". .... Now, if Bernatz will set aside his "amazing dirt machine" for a moment and wheel out the company guillotine, we can proceed. ..... ( :- ) )

(Sun Jun 15 1997 01:33)
silver is poised to make a good jump this up-coming week.
467 is an excellent buying point.
soy oil is looking good too.
what'cha gonna do?

(Sun Jun 15 1997 01:33)
RJ: Violent natures must demand similar expression. You beat me to the quote.

(Sun Jun 15 1997 01:41)
RJ: The equation will only remain valid so long as demand remains low. If anything is allowed to happen to suddenly boost demand, the "monetary authorities" will be powerless to stop it. Now it is possible to control the price with nothing more than 'chin music'. .... Best gold strategy? Sit back and relax until the volume picks up. Until then its hopeless.

(Sun Jun 15 1997 01:55)
Violence begets violence....Up against the wall....hahahaha...Night Earl!
It's 2:57 on the East coast...nite Tarnished.....

Bernatz de Ventadorn
(Sun Jun 15 1997 05:17)
chop@zee neck
For Messiours Ted and Earl and RJ
Mah blood she get so HOT when we speak of zee
revolutions and chop up zee kings an zee tings lak
zat my dam. Woo ----- mah head she speens arround.
Ha ha
When do we begin zee march ??

(Sun Jun 15 1997 06:15)
what are these guys smokin'????@7782dow

Al Goldman, technical analyst at A.G. Edwards:

"We could certainly get a 2 percent to 4 percent correction anytime, but if we do, it would just be a normal pause."

Jack Baker, head of block trading at Furman Selz, agreed that a 200- or 300-point correction might be in the offing, but added that such a move would be "just another buying opportunity."


Let me get this straight--The dow goes up 4.66% in one week, its frothiest week on record, and these gurus think that 7500 is a good buying point?

VRONSKY, we sure could use a "Blue Sky" stanza!!!!!!!

George S. Cole
(Sun Jun 15 1997 06:44)
GLENN: As always your insights are respected and appreciated.

Steve Puetz; Thanks for the info on gold ownership by CBs and the private sector!

Milhouse: We are on the same wavelength. The gold market will not be able to revive in a major way until private investor demand picks up a lot from its current depressed level. Until then the CBs will have no trouble keeping the price down.

What If!
(Sun Jun 15 1997 06:49)
About the CB's Selling their Gold

What if Ted Butler's estimates about the Gold Loans were
seriously underestimated, lets say to the extent of
making Steve Puetz's 1996 estimate of gold holdings at
500 million ounces for the CB's and 4135 million ounces
for private stocks.
Now, as Earl described, using a little "chin music" and
some well reported Gold Sales, they drive the gold price
down to a very low price.
Then they go to those they made the loans to, tell them
to keep it quiet, but they want their gold back, at half
the spot price. They also buy as much gold as possible at
spot and really increase their holding's.
They would probably have to keep the financials up to do
this and I think they are presently doing a good job.
In the end result they will have a happy public and solid
gold reserves. Think about it?

George S. Cole
(Sun Jun 15 1997 07:10)
POLARBEAR: Let's face it; the buy the dips strategy has been extremely successful over the past few years. The overwhelming mass of investors will continue to follow this stategy until it fails. And then it will be too late.

BTW, I do expect it to fail badly the next time it is tried -- probably this fall. Once the market corrects and does not quickly rebound to new highs, then the fun will begin in earnest as a frightened public starts to liquidate their mutual funds. And there will be few buyers except at much lower prices.

Mike Sheller
(Sun Jun 15 1997 07:48)
Sunday Morning @the Charts
The Sunday Morning Chart perusal brings the following significant updates: BONDS - perhaps more important than stock price behavior from a technical point of view, the 30 year Bond is poised to challenge 113 this coming week. If it knifes thru this level, it will break out of a "Rhino" triangle, a pattern which yeilds reliable continued momentum at breakouts. You could teach a kid to trade Rhinos. Kids are very visual, and can pick up the ears and horn very quickly. In fact, the way I've been trading lately, I think I'll start hanging around the schoolyard with a chart book under my trench coat. ( Psst, hey kid, wanna find a Rhino for me? ) Any how, tho I too feel this stock market is in La La Land, I would have to conclude that if the Long Bond takes out 113, we are going up significantly on paper, and down surprisingly on rates. The apex of this triangle occurs a YEAR from now! If can't IMAGINE a paper bull of a solid year, so let's say there's another 3 - 5 months rising paper at this breakout. I'll leave it to everyone to visualize the charts of the stock market blowoff this could represent. If 113 proves to be the containment in this triangle for bonds, then look for a price reversal after a few days of banging up against resistance. Support for a reversal comes in at 106. If 106 is breached on the downside, then we could be in for a bond collapse that would indeed, reasonably, terminate a year from now at the triangle apex. Everyone following this? This is really important. We have been thinking all along we are in the last stages of the market cycle, but we have not yet encountered a phase where all 3 assets, bonds, stox & gold, are RISING. This may be the last chance to observe that.
GOLD- The bad news is that price was stagnant last week, stochastics have turned down but are not sufficiently depressed yet, and the call options are still running merrily ahead of puts. The good news is that the upside breakout level, 346 basis August, is now a bit lower in this current configuration ( also a triangle ) than a week or two ago ( was 348 ) . Price it at lower end of triangulated support, around 342 basis August. Much below 342 is very dangerous here. Price has been driven to the end of a short funnel. Let us hold our breaths and watch the bonds this week! Finally, last but not least, the magnificent trine ( 120 degree supporting angle ) that NYSE Sun has been receiving from Neptune ( once in a lifetime astrological aspect, and very powerful long-term move ) will retrograde to the exact degree one more time in, you guessed it, OCTOBER of this year. Then Neptune goes direct and this magnificent underpinning of the bull market starts to break up. So...I guess I'm saying that, as amazing as it sounds, there is room for a final thrust to this stock advance that would boggle the mind of bull and bear alike. If bonds can rise for the next six months, it is not inconceivable that stocks could continue into a top for several months after that. Watch for the end-game brief explosion of obscure small caps for the exit sign.
PS- My NYSE Balcony Indicator is getting overbought. I don't think they can get any more grinning exchange officials on that parapet at gavel time.

(Sun Jun 15 1997 08:08)
Joke of the morn
Happy Father's Day to all. I need to quit reading this material and give him a call. I have written in earlier posts about getting screwed royally ( without a crown even ) by my commodities broker. I faxed him a letter Friday of my grievances regarding the platinum trade where the market went down, I went short and still supposedly lost two-thirds of my invesment. I received no response. I am going to fax the president of the company in the morning. If I get no response I will complain elsewhere. Do any of you have any idea where to take these matters short of going to court? But enough about the grimness of my investment experience I post the following in good humor.

A man placed some flowers on the grave of his departed
mother and started back for his car, parked on the cemetery
road. His attention was diverted to a man kneeling at a grave.
The man seemed to be praying with profound intensity, and
kept repeating, "Why did you die? Why did you die?"
The first man approached him and said, "Sir, I don't want to
interfere with your private grief, but this demonstration of hurt
and pain is more than I've ever seen before. For whom do
you mourn so deeply? Your Child? A parent? Who, may I
ask, lies in that grave?"
The mourner answered, "My wife's first husband! ... Why
did you die? Why did you die?"

(Sun Jun 15 1997 08:23)
Mike Sheller -- You may get your chance to watch the bonds 'dance' next week. Starting Tuesday, I think. We just need a week or two more of weak economic numbers to finish out the bond rally. Then we can see the delayed 'strong' economic numbers for the next couple of months! :- ) )

(Sun Jun 15 1997 08:45)
Tort ( 8:08 ) Re-broker: Deep six em.....Re-joke: hahahaha....

(Sun Jun 15 1997 08:48)
Mike Sheller: Agree with you on the potential bond break-out and if it happens, paper will continue to soar!....

(Sun Jun 15 1997 08:56)
Earl -- Regarding INTC on the weekly; Talk about a bearish engulfing candle! Not to mention the double top also. The last time that a similar pattern emerged was in June and November 1995 for the tops. Same pattern this time except the time is slightly shorter, February to May/June. Four months as opposed to five months last time. Perhaps the tiff between DEC and INTC will have more profound effects than many believe. INTC is almost 20% of the SOX index and a good piece of the NDX. If we start to 'roll over' here, can the rest of the major indexes be that far behind?

This lends credibility to Steve Peutzs' deflation scenario. I.E., a loss of 'wealth' effect. Here's a scary thought, what if INTC is putting a HUGE head and shoulders pattern here. What is the downside target? $60 - $80 per share from $144.74? OUCH! Nah, that could never happen! What was DECs high? $190 something, and now it's trading at ?????.

The problem here, for me anyways, is that this won't help gold. People will either eat their losses or try to hang on to 'get even'. Either way, money evaporates for the purchase of anything, let alone gold. I think we need a 'stupid' event. Something that tanks the markets, but in such a way, that it causes monetary stability fear also. Mexico anyone? Elections there are coming in July, and the Mexican Peso is again 'overvalued' ( what ever that means in relation to other currencies ) , pressumably for the election. It would be just the spice to add to this cauldron of a high flying market, rallying bonds, and whooops! Another currency problem! Damn, I thought they fixed those currency thingees! :- ) )

Howdy TED! Nice morning here, cool with bright sunshine! Got your Canadian air conditioning just in time. :- )

BBL, got to do some self sufficient chores, like change the oil in the vehicle. :- ( (

(Sun Jun 15 1997 08:57)
17 days to go for Hong Kong.....If Hang Seng bubble bursts alot of that money could go for the gold...Mornin Panda: What's your take on stox market and the long bond??

(Sun Jun 15 1997 09:07)
Panda: Changing yer own oil....good man!...Dec=35.875 ( up .75 Friday ) ....
I think an event in Asia has more potential to disrupt the stock market euphoria....Hang Seng at record highs with d-day looming...Thai market ( SET ) down 60% this year alone...Political uncertainty in Indonesia
....Corruption in Malaysia ( thanks JIN ) ....friction between Japan+China...

(Sun Jun 15 1997 09:51)
mornin Nailz: Did ya get me re-mail...strange things happening with the "puter" as my re-mail bounced back into my machine....but showed up as bein sent....Beautiful day on the North Atlantic ocean!...

(Sun Jun 15 1997 09:54)
Silver price increases per unit time:
Earl: I have been making this prediction for many years and of course it has yet to come true. Although we did get a foretaste in 1980. I would say each 1000 points up on the dow increases the odds in favor of it occurring.

Silver is currently selling for about 5.00 per ounce. A time is coming when it will increase 5.00 in price in a year. It will increase 5.00 in a month. It will increase 5.00 ( we will skip a few intervals here ) a minute. And lastly the price of silver will increase in price five dollars per ounce in less than one second ( although this may only be the bid price ) . All these periods probably will occur in the same year but need not be unique. It is only going to happen perhaps once in our life time and a wait is required. Is it not a good deal to buy a real asset money, that is also insurance and that is also an investment with these kinds of speculative possibilities?

(Sun Jun 15 1997 09:57)
in sack-o-tomatoes
Hi, Tort: Try the enforcement link at . Also, the Nat'l Futures Assn has some useful info about arbitration at . I like the NFAs "disciplinary information access line" ( DIAL ) where they'll let you know if a broker has a disciplinary history. DIAL won't help you with your current problems, but it'll be useful when it comes time to pick your next broker. It saved me once from going with a guy who had an abominable history. At minimum, any broker you're considering opening an acct with should be registered with the CFTC, and be a member of the NFA, or so the boilerplate goes. Both agencies will cooperate with you and help you determine if a broker meets at least those requirements.

(Sun Jun 15 1997 09:57)
For all you Canucks,here's a sick joke...In last poll for Nova Scotia premier,the results are: NDP 33% Tory 28% Liberal 26%....NDP leader,Robert Chisolm, makes Bob Rae look like a rocket-scientist....

(Sun Jun 15 1997 10:05)
@New England
TORT:I have had some experience in the commodities/securities law areas. You need to tell the brokerage firm that you will file a complaint with the CFTC in Washington DC to have your claim heard and arbitrated. Further write ( or threaten to write a letter ) to the NFA in Chicago referencing the complaint. ( you might also request any findings re the firm or its employees from the NFA and CFTC for problems such as yours ) Demand all documentation regarding the transactions ie time & sales reports from the mkts matching the times your orders were time stamped per the brokerage order entry. If they record orders over the phone obtain documentation re the time you placed the order with the hard copy records. Tell them if they dont provide this information within a week you will file a pleading to initiate procedures for remedial action.

Mike Sheller
(Sun Jun 15 1997 10:12)
bw: Slap me five! I found your "5" scenario very intriguing. Is this intuitive or based on any sort of systematic or phenomenal analysis? Just curious. The image does resonate in my soul as possible, attainable, and, of course, desireable. Silver spike panics do tend to progress in startling geometric progressions of time, space, and price. In other words, AWESOME. Looking forward to a more moderate one in July/August.

(Sun Jun 15 1997 10:22)
Canadian Precious Metals Mining Stocks Expert reviews most promising PURE SILVER PLAYS & others. See Goldbugs Weekly Comment - Click RELOAD at Gold Digest page:

Bob M
(Sun Jun 15 1997 10:26)
Good morning. Does anyone have an opinion on what people who have been "buried" in gold since 1980, will affect the market in the next price rise as they bail out to recoup their losses. It seems to me like just about everyone holding physical gold these days has lost money ( not including interest if money would have stayed in bank ) except the few who bougt below $300. Any ideas gentlemen. Thanks.

(Sun Jun 15 1997 10:27)
The Super Rich and Gold
Maxt..Re yours of Fri Jun 13 05:23.....Sorry for the delay in answering
your thoughtful and interesting post.

After re-reading your post I wonder if there is a misunderstaning about who I am referring to when I use the term "super rich". Please let me try to explain myself.

I love my country ( USA ) it has evolved into the best and fairest, most free
system man has yet conceived. But I fear it is in danger.

Please consider for a moment that, our economy has evolved into two
tiers, the first you described most eloquently in your post. The second tier
is the one I am talking about. For the most part this second tier is made
up of the super rich who control the largest corporations in our country.
If you want to put numbers to them, a person with a net worth over 100
million who control the 2000 largest corporations in the US.

I have no problem with anyone having as much money as they can get or
corporations being as rich and big as they can.

I do have a problem when they start abusing our system by not paying
their taxes and by not being loyal to the system and people who made
them rich.

Let me give you an insight into their world by way of Forbes Magazine.
Every year Forbes lists the 400 richest Americans. Below is a footnote to
that article which describes how they evaluate wealth.

"Since wealth abroad is sometimes held in complicated ways designed to
retain control or bypass various taxing authorities, ( IRS and State ) we
count property owned if it is involved in obvious devices for ownership,
like family holding companies, or cross-ownership, and sometimes less
obvious ones, like certain foundations designed merely for tax avoidance."

I can not get over how blatant and obvious the scandal is. They can
publish how they are evading taxes. I guess the IRS does not read Forbes.

To give you an indication of how this is escalating and how these tax
evaders are building more and more wealth, consider these stats: The
proportion of Federal Income tax derived from Corporate income tax as
declined steadily, 32% in 1952; to 23% in 1960; to 17% in 1970; to 9% in
1985 ( 1985 is the last year I can find stats on ) I bet it is below 5% now.

I contend the "small guy," who might be making $200,000 a year and
corporations making ten million a year, for example, are for the most part
paying their share while the "super rich" are blatantly evading. Example
GM sold its subsidiary Hughes and evaded 3 billion in taxes. They did
not pay a dime on their capital gain. No wonder the super rich are going
to be super-super rich very soon.

I can go on and on about the scandalous lost tax revenue, one of the most obvious is the leveraged buyout where interest expense is used as a
corporate deduction to evade taxes.

The super rich have been escalating this practice over the last ten years,
and are becoming the super, super rich. How much would your net worth
be if you had not paid taxes for the last ten years?

You could say, "well they are not breaking any laws or if they are the
laws are so grey"......of course they are not-they have paid politicians to
change the laws or make them so grey or so confusing that they are not

Now to the scary part, the part that could jeopardize the "pursuit of
happiness" we have been enjoying in this country. And also why this is
being posted on Kitco. "You can fool some of the people some of the
time, but not all of the people all of the time." The average Joe and the
average corporation is starting to figure out who is not paying their fair
share! This will soon be felt by way of the ballet box. If something does
not change it could be a very, very liberal change...... so hang onto your

The super rich for the most part are a very egotistical, arrogant and
competitive lot, they do not want to give an inch. I for one am going to be biting at their behind to pay their fair share to avoid this very liberal
disruptive outcome.

(Sun Jun 15 1997 10:45)
How low dow:
Projection of possible coming lows in the dow always draws howls. But lets look at the math. Lets give the dow some breathing room and assume it does go to 10,000. The current dividend yield is about 1.6%. This is occurring in the euphoria of the advance. In the funk of the coming depression the dividend yield will probably exceed the 16% it yielded in 1932. That would put the dow at 1000 with no dividend cuts. I think we can assume at least a 75% dividend cut. This projects the low on the dow at 250 points. Personaly I think it will go lower.

(Sun Jun 15 1997 10:49)
BW: I'm howling....

(Sun Jun 15 1997 10:50)
@...Math ?
bw: What math are you using ?

(Sun Jun 15 1997 10:54)
@...Bob Rae was Rhodes scholar...for what its worth
TED: The only people interested in Nova Scotia Politics are Nova Scotians.

(Sun Jun 15 1997 10:58)
Bob ( 10:54 ) Rhodes scholar does not =COMMON SENSE...I know plenty of Harvard grad's who can't think their way out of a paper bag...

(Sun Jun 15 1997 11:13)
Re: Mike Sheller
Mike: The numbers just sound impressive to me. I happen to think they are also possible.

(Sun Jun 15 1997 11:28)
@...Ted, do policticians have common sense ?

Steve Puetz
(Sun Jun 15 1997 11:29)
Earl: Your 1:41 posting was exactly the way I was going to respond to RJ's 1:10. You beat me to it only because I ocassionally sleep. As long as monetary demand for gold is weak, CBs can easily push it down. During the 1970s, when monetary demand was stong, over 200 million ounces of Central Bank gold sales could not knock down the price. Private concerns were more than happy to get cheap CB gold. It will take a reversal of the bull market in stocks to revive monetary demand for the precious metals. Then it won't matter how much they sell.

(Sun Jun 15 1997 11:32)
Re: Bernie,Tax
Bernie: I concur with your anger over the distribution of the tax burden between individuals and corporations. I have been meaning to post a like if less detailed piece. Thanks. I should first say all taxes should be greatly reduced for all. My numbers are not quite as bad as yours but they still show about a three fold increase in the individual burden in relation to that of corporations. Aside from the unfairness of it, I think something deeper is revealed here, like who is running this great democratic country. And to what purpose.

(Sun Jun 15 1997 11:35)
I just heard over my wire sources that there are 50,000 open buy orders
at the market for August gold COMEX. There must be something afoot!
Watch out Monday morning!

(Sun Jun 15 1997 11:48)
Dow Insanity
To all my fellow goldbugs squirming around here in the Dow's scree: Take cover, boys! Ain't no way those Wall Street bulls can save themselves with those Charmin parachutes of theirs. A chartist's paradise:

Steve Puetz
(Sun Jun 15 1997 11:50)
Event to start a stock market crash
Panda: Go to your local library and read the front page of the May 7th Wall Street Journal. The article concludes that a global banking crisis is brewing. It says that banks are in trouble everywhere -- Japan, China, Tiger countries, South America, India, ..... If any one of these worsen, they could trigger the implosion.

(Sun Jun 15 1997 11:54)
TED -- Will get back to ya.

Bernie -- How about something as old as the Bible, an absolute, no excuses, flat tax of ten percent. Never to be raised or lowered, and the government MUST live within that revenue stream PERIOD. No exceptions. Welfare, unemployment ( they already got that ) , SSI, everything! That way everyone would know where they stand with regards to the tax man, no tax shelters, or tax avoidence. One simple form, how much income did you have last year? OK, multiply by 0.1 and send us that amount! BTW, there would be no with holdings from income! So EVERYONE knows how much they are paying and must put that amount aside! OK, off my soapbox and going back to reality.

Naah panda, would never work! Who would put the tax money aside for the whole year?


Steve Puetz
(Sun Jun 15 1997 11:55)
Next bull market in gold
Bob M @ bitterroot: While gold investors are mostly discouraged now, once conditions change, I believe most will regain their confidence, and say things like: "I told you so." Some will sell out early, but while the financial markets collapse, there will be no alternative but gold and silver. Most will hold what they have, and probably buy more.

Mike Sheller
(Sun Jun 15 1997 11:57)
DownDow (Down, Down, Doobie Doobie)
bw: That 250 Dow seems a BIT overdone. That's like saying the stock market will simply disappear. 1929-33 saw a 90% decline. 1975 bottomed at around 50%, with dividend yeilds of around 6-9% ( going by memory here, don't quote me ) . I think we could be conservative and refigure your scenario at a dividend yeild of 11-12%. This is what I see the Dow Utilities Average yeilding in a few years, based on the price chart channel it seems to be in the process of setting up. So I'm being generous with stocks here. Granted, an out and out deflation would be quite savaging to this bull, but then wouldn't you think dividends would evaporate along with other forms of wealth.

Steve Puetz
(Sun Jun 15 1997 11:59)
Tax the super-rich
Bernie: Even if I agreed with you, which I don't, that the super-rich should be heavily taxed, it wouldn't work. They would flee the country. It's already happening to a certain extent. There are lots of countries around the world that welcome the super-rich and the capital they bring with them. Taxing wealth always works in favor of pushing desperately needed capital our of the country and into overseas coffers.

Mike Sheller
(Sun Jun 15 1997 12:02)
Back to the Bible
PANDA - Amen to your lithe Tithe of 10%. The Lord would approve, and so would my wallet. RON - Amen as well to the Yardeni of Eden. It is indeed a chartmeister's Heaven.

Steve Puetz
(Sun Jun 15 1997 12:03)
@ Dow 250
Bernie: I can't believe it. I've found someone more bearish than I am. I've been predicting Dow 300 for the entire decade -- giving the exact reasoning you have given. But you have under-cut me by 50 Dow points. I may have to re-examine my previous calculations.

Steve Puetz
(Sun Jun 15 1997 12:04)
@ apolagy to BW
BW: Sorry, I gave credit to Bernie, for for Dow 250 prediction.

Steve Puetz
(Sun Jun 15 1997 12:09)
@ skeptic
Insider: Give me your sources for that 50,000 lot Comex Gold buy order!!!

(Sun Jun 15 1997 12:13)
Venerable veteran analyst sees bullish signals on Gold Indicators. Also, his charts paint positive platinum picture. He likes Stillwater, N.A. Palladium & Franco-Nevada. RELOAD at Editorials page:

Steve Puetz
(Sun Jun 15 1997 12:14)
@ insanity
Ron: Amen. I've already taken cover. Time to cook chicken on the grill. Will be back to Kitco-chat later today, to get updates. I fully expect exciting and volitile markets this coming week. Won't tell ya which direction, though.

(Sun Jun 15 1997 12:18)
BW @9:54: while I don't know enough about the future to share your unbridled enthusiasm for the numbers, I do have a growing sense that just maybe, the leveraged approach, that worked so well in the past, may turn out to be a fools game this time. It's a personal feeling that has been growing in intensity of late. ..... For lack of a definitive reason to explain my thoughts, I always return to the same question: "How can the most damage be done to the most people, in any given situation?" The game is simply not structured for the many to prosper. PMs are no exception.

(Sun Jun 15 1997 12:20)
"BUMBLING BANKS From Beijing to Brazil to Bulgaria"
"BUMBLING BANKS From Beijing to Brazil to Bulgaria
Super Bear STEVE PUETZ LETTER includes Bank of China & India among host of other tottering banks - & western world financial systems Ponzi Scheme may topple markets. 5/27/97 report:

George S. Cole
(Sun Jun 15 1997 12:24)
lefty and right
BERNIE: History shows that the politcal pendulum always swings from left to right and back again. The excesses of the rich make periodic swings to the left inevitable. Wasn't Russian communism a reaction to the truly gross excesses of the Tsars? And the more pendulum swings in one direction, the sharper the move in the opposite direction when the tide turns. Just like markets -- the bigger and longer the bull, the bigger and longer the ensuing bear. The impending swing to the left will be very bad for paper, but very good for gold.

For those who doubt this can happen look back to the 1920s. A sharp swing to the right, booming stock markets, low inflation, tax cuts for the rich, etc. And look what followed!

(Sun Jun 15 1997 12:25)
Insider @11:35: ... 50,000 open buy orders? At market? ...... "From your mouth to God's ear"....... ( :- ) )

(Sun Jun 15 1997 12:31)
Flat Tax
Panda: Double amen to the 10% flat tax. I'd like to see 10% also cover all state and local revenue requirments, too, right down to fees like those imposed for driver's licenses. All pigs should feed at the same trough! That way everyone knows exactly how much they are giving to the oinkers. Oh, well. We can dream, can't we? And if we're discreet about it, we won't be taxed for it ( the lottery is a dream tax, after all ) . I think I saw in Friday's WSJ that total US revenue take as a percentage of GDP, exceeds that in communist China!!!

(Sun Jun 15 1997 12:38)
Mike Sheller;-

Seem to agree with your posting on the outlook on bonds and paper near term, many chart look up to me, weird as that may sound at this time.
However so do gold stocks many are making significant basing patterns for and up move, maybe along with paper.

Please contact me email, about more personal matters- growing up in N.Y.

(Sun Jun 15 1997 12:54)
With more than $5 billion pouring into the mutual fund reservoir weekly, the Dam will burst. See June 16, 1997 The Coming RUN on Mutual Funds.:

(Sun Jun 15 1997 13:00)
Re: panda, who
Panda: Believe it or not until the 1950's everyone saved his taxes up and paid them once a year. Seemed like the thing to do and the tax was so little ( in relation to today ) that it was not hard to do. When they started withholding everyone thought it portended nothing good ( boy were we right on that ) . Of course before that most people paid NO federal income taxes. That was for the rich ( but that is another story ) . My theory on withholding was that the yearly tax total was getting so big you felt it was a poor purchase when you sent in the money. My brother felt it was because the relatively poorer people who were being taxed more heavily each year, were having trouble saving the money. Some felt that by making it easier and more convenient they could keep jacking up the rate of real taxes. I guess our masters did know best. Who can save 50% of his earnings?

(Sun Jun 15 1997 13:26)
Bob ( 11:28 ) NO!...on your other point: I think Canadians outside of Nova Scotia, DO care about Nova Scotian politics because THEY are paying their bills.....

(Sun Jun 15 1997 13:30)

(Sun Jun 15 1997 13:31)
Sorry, but if I gave away my sources I would not be an "insider".

(Sun Jun 15 1997 13:33)
COME ON GUYS....Let's not all predict extremes like 100,000 or 250 DOW... Let's keep the cycles within the extremes, but keep them churning...HEY TED...You have incoming....

(Sun Jun 15 1997 13:41)
Vronsky ( 12:20 ) I know many who have stopped checking in at Kitco because they think your views are DANGEROUS and this post, plugging Puetz is a prime example of some of your BIASED and simple-minded thinking and further exposes your hidden agenda!

(Sun Jun 15 1997 13:42)
Nailz: I'll keep an eye out.....

(Sun Jun 15 1997 13:48)
Nailz: Got yer message and check for an answer in ten minutes or so...

(Sun Jun 15 1997 13:53)
ALL.... The Supreme Court makes the final decisions that really turn the liberal or conservative tide in the US...The are appointed by the president and confirmed by the senate. Supreme court justices usually stay on the bench for many years ( life ) , and our current court has been stacked to the hilt with conservatives...Now true enough the Clinton election shows a move to the left here, but how long until we get a liberal Supreme Court??? We don't even have a liberal senate to approve one liberal justice now. We are 3 two year elections away from having a liberal senate ( if then ) . Then how long to replace the Supreme Court ???? I hope I don't have to wait for a big move to the left for my metals holdings to move up !!!!!!

(Sun Jun 15 1997 13:53)
in Sack-o-tomatoes
Insider: I fear you might be a provocateur.

All: After watching the Dow all week, I *still* apparently haven't gotten my fill of fantasy; I'm off to the movies.

(Sun Jun 15 1997 14:01)
Nailz: Space-ship coming yer way...

(Sun Jun 15 1997 14:01)
LURKER 007....Perhaps you would be so kind as expose VRONSKY's hidden agenda to the rest of us. I have been a regular for some time, and here I am just thinking that VRONSKY's hidden agenda is to promote his web site. Guess that just goes to show that there must be some sinister plot behind everything ( or maybe NOT ) .

Strad Master
(Sun Jun 15 1997 14:05)
LURKER077: Re your posting to Vronsky: Are you kidding? Anyone who stops reading the posings here because he/she thinks some of the ideas posted are DANGEROUS is an idiot! Most ADULTS I know are quite capable of dismissing an idea they don't agree with and passing on to the next posting. I do it all the time. Tell your friends to try it sometime. It might help build their character. They might even learn something from soimeone they disagree with! Give me a break...

(Sun Jun 15 1997 14:05)
His not so well hidden agenda is to PLUG his OWN site!

(Sun Jun 15 1997 14:08)
Nailz: Scaterie Island bekons and it's time fer some seakayaking...

(Sun Jun 15 1997 14:11)
HEY TED....Wait for me before you take off for Scaterie...Am bringing my White metal detector and a big tow sack to put the loot in...

(Sun Jun 15 1997 14:15)
Bernie - it goes something like this. The top 1% of income pays something around 40% of federal personal income tax revenues, the top 5% something
like 60% of federal personal income taxes, the top quintile maybe 80-85%
of federal personal income taxes. Federal personal income taxes forming
the majority of federal revenues, one could say that, rather than paying no taxes, the super-rich are actually buying all this government for the
rest of us peons. For which gratitude would be the appropriate sentiment to express, rather than spiteful envy.

George S. Cole
(Sun Jun 15 1997 14:18)
right and left
NAILZ: There were very few leftists in either Congress or the courts in 1929 either. These are lagging indicators. Perhaps populist would be a better word than liberal to describe the coming shift in the politcal balance of power. Not right against left, but top against middle and bottom. And with the markets as elevated as they are, it will not take of a swing towards populism to send them tumbling.

Strad Master
(Sun Jun 15 1997 14:23)
LURKER 007: Re your post to Nailz: So what? Vronsky has a gold-related site filled with invaluable information in addition to interesting editorial comments by a wide variety of analysts. Unlike some who have occasionally plugged their own ( subscription ) newsletters at this site it is free to visit and partake of all the information you might wish to absorb. If you don't like it - don't go there. No one forces you to use your clicker in any particular way.

(Sun Jun 15 1997 14:31)
GEORGE.....Will the populist movement in this country be Top against the middle and bottom OR middle against the top and bottom ????? I see the middle class as having the greatest power in numbers of ballots at the polls. I also see them as sick and tired of supporting the lower class who pays little or no taxes. They also feel abused in that the rich can afford tax shelters they cannot....It is the middle class I see who want equality in taxation.....Yes I would call that a populist movement...

(Sun Jun 15 1997 14:34)
So what is exactly so wrong about Vronsky providing a site to air Steve Puetz's views on Gold and the state of ( or non state ) of the international financial system.
99.9% of the people I know have most of their entire life savings invested in Stocks/Bonds, and hold absolutely NO GOLD except a puny ring on their fingers. To me, this confirms the views of many of the Gold Bulls here, and indicates that the money feeding the stock market mania has to begin drying up very soon. Remember that all pyramid schemes collapse once the new money stops flowing in and paying returns to the old money. Pyramid schemes never go down slowly, they simply collapse. How much of this analogy one can apply to the stock market, time will tell.

Steve is a super bull on precious metals, and even if he is partially right,
those investors that diversify even a modest amount of their portfolio into PM's, will be thanking their lucky stars, once the ENEVITABLE EVENTS
begin unfolding.

(Sun Jun 15 1997 14:39)
Re: Mike Sheller, dow
Mike: I know 250 dow seems a little much, but the dividend method is but one way to project such a number. The question is what do we trust the numbers or our sense of euphoria. The numbers also say we are going to at least 5000 gold. It seems absurd now because we are breathing the air of the gods. In the time to come the act of purchasing a stock will seem just as absurd. Want another method? Currently the ratio of debt to stockholder equity for the s&p 500 is about 93%. You are paying dow 8000 prices to become almost a net debtor. I havent worked that one out but it could be better than 250.

(Sun Jun 15 1997 14:49)
ALL........HELP............I need a near real-time site for the XAU options....Any help would be appreciated....

(Sun Jun 15 1997 14:51)
Super Rich yours of 11:32... I agree with your observation about a deeper meaning to the trends in taxation. We must be very cautious and suspicious of the men who have amassed wealth into the billions, they are running on ego and power which could be very good or very bad for the rest of us. Thanks for your post. Cheers and good trading.

(Sun Jun 15 1997 14:58)
RJ Platinum Factor
Regular Kitco contributor, RJ, discovered an uncanny correlation between the Yen and the Yen value of Platinum. It appears to demonstrate predictive qualities. See charts in Analysis section:

(Sun Jun 15 1997 15:03)
Re: Vronsky
Professor Vronsky: Thanks for the McAlvany papers especially part VI. The fed will be the buyer of last resort for some fund sellers but this may only server to make the crash more orderly.

Mike Sheller
(Sun Jun 15 1997 15:15)
catchup ketchup
bw: I wholeheartedly agree gold will be in the thousands of dollars ( 2400 to ??? ) early into the next century ( only a few years folks ) . To be honest, I haven't put any time into trying to figure where the Dow could settle in a longterm bear. Will do that soon, or at least try. I'd go by the stress lines and resistance/supports I'd find on the chart. REIFY: Will get back to you. NAILZ, GEORGE S. COLE - Agree most definitely about coming left turn. Already evident in Europe, and they have always lead the way to the errant path. Tho I must say most of the "conservatives" of today are of little value to the further progress of this civilization either. The effect will be the "middle and bottom" against the surrounding catastrophe, rather than against the "top." The top is always an easy target. What else is new? The momentum for change, itself being "popul;ist" will come from the mass of the people from upper middle on down. There will be nowhere yto run, nowhere to hide. Freedom lovers will be freaks once again. They will splinter off and found the seed of the new economy. I will write more about this at the Astrological Investor feature on Gold-Eagle. Get Real, Get Gold! Speaking of Gold-Eagle, and getting gold, may I say first, that Lurker007 does not even deserve a response. Having said that, I can only take my hat off ( if I wore one ) to Mr V for his very clear stand as to where he is at and what he's all about. Win, lose, or disagree, the great beauty of his site, and Kitco, is that you'll always find interesting people with an opinion and a purpose. Mr Vronsky would be the LAST person on earth I would ever accuse of a "hidden" agenda. As for his views being dangerous, what is Lurker007 doing at a gold chat anyhow? Duh??!! The person who is dangerous is the one who lurks in the shadows, contributes nothing, and attempts to smear those who give freely and tirelessly of their talent, opinion, and courage.

(Sun Jun 15 1997 15:18)
VAT Tax?? yours of 11:54...If you are talking about a VAT tax, it might work. But the VAT,s I have heard from Washington have "exceptions" when I hear "exceptions", "deductions"... "credits"... "deferrals", I hear tax attorneys and tax accountants rubbing their hands together. In ten years we end up with what we have now, a mess. I agree with your, No Exceptions. Collect the tax when purchase is made. Cheers.

(Sun Jun 15 1997 16:06)
the price of gold:
As the cb's sell or threaten to sell yet more of our gold to accomodate the burgeoning demand, another branch of our gov is contemplating the mechanics of the coming gold confiscation. One detail to be worked out is the price to be paid to those who do their civic duty. The following true story may give an indication. In about 1986 a plane carrying about 800 insured krands crashed in mexico. The krands were worth over 400 each at the time. The insurer said since the official gov price for gold was 42? bucks that is what they would pay. The case went all the way to our supreme court. What do you think our supreme counts said? Yep 42.

Crystal Ball
(Sun Jun 15 1997 16:06)
20 minute delayed XAU quotes
NAILZ--For XAU quotes ( If 20 minutes delayed is near enough to real time for you ) go to
then go to the box where it says, " Enter a Stock or Index symbol here for delayed quotes and a list of options for the underlying: " and enter XAU, and you will get a quote table showing at least two different months and several strike prices. For a single option quote, use the box above where it says, " Enter an Option or LEAP symbol here for delayed quotes and fundamental data using the following format: period mark ( . ) + symbol + expiration month code + strike price code ( example: .xaust ) . For assistance, click here. "

(Sun Jun 15 1997 16:15)
George S. Cole...I believe you made some comments about the latest Steven Leeb book. I bought it, and am still reading it. He seems to believe that the worlds populations will be asking for more. This in turn will force governments to inflate rather than allow deflation. This seems to be what you are suggesting in your latest post ( left/populist leaning politicians ) .

I view Japan as leading the US. They did not, or were not able to inflate, and seem to be living through what so far has been a slow deflation. Why wouldnt we do the same. Does the availability of credit mean people will borrow ( pushing on a string ) ?? Your thoughts.

(Sun Jun 15 1997 16:19)
George S. yours of 12:24....If you are saying we are about to experience a swing back to the left, I agree, lets hope it is not a radical swing.

I enjoy your posts and your sense of history in almost all of them. I have an observation, would like your comments.

I see three immense historical events converging on the same time frame, July and August.
1 ) One hundred and fifty six years of British rule of Hong Kong coming to an end, with Chinese troops a bit over anxious to "occupy" the territory.
2 ) The fate of the European Common Market being decided, possibly ending.
3 ) The US stock market reaching a bubble top and bursting.

Do you agree to assigning the word "immense" to these events? Am I correct in assuming it would be very unusual for all three to happen within a three month time frame; from an historical perspective?

(Sun Jun 15 1997 16:40)
bw -- regarding your 13:00, my point exactly! Who can save 50% of their income per year?

Bernie --regarding your 15:18, NO VAT! The government gets theirs at the end of the year! One lump sum! See, I can engineer a good tax program too! :- ) ) I want EVERBODY to see the TOTAL amount going to Uncle Sugar! I want the 'contributors' to feel the pain that Uncle Sugar says he feels for us! I want the pain to be sharp and searing, so that the 'payers' will start to ask some pretty tough questions of themselves as well as Uncle Sugar. I want the tax to be flat! I want no exceptions to it! If you make $10,000/year then fork over $1,000. If some large corporation makes 30,000,000,000, then fork over $3,000,000,000 at the end of the year. Oh, one other point, THE MONEY GETS TAXED ONCE! None of this, the company is taxed, then the dividend is taxed, then the sales tax that you pay for something that you bought with your dividend check...... Well, that's my simplistic idea. It could never work, but what the heck! :- ) )

(Sun Jun 15 1997 16:49)
Re: panda, tax
panda: Sounds good to me. I like the pain part. Maybe it should be required to pay in pennies, in person! It could work if we were honest. Honest about what gov can do, should do and is doing now.

(Sun Jun 15 1997 17:11)
Many thanks
Thanks WW and Ron for the excellent info as to how to pursue my commodities claim against my broker.

(Sun Jun 15 1997 17:48)
Lurker 007: You have accomplished something no one else has been able to achieve. Until now. ..... Over many months, Herr Strad Meister has been our paragon of gentlemanly deportment. Faced, countless times, with moments of emotional stress, interpersonal bickering and unseemly behavior, The Strad has always provided the oil needed to calm troubled waters. Until now. Somehow, you have managed to irritate a true gentleman. It's a skill few possess. Burnish it, if you must, but please do it elsewhere. We enjoy Herr Strad Meister like his oldself.

As for Herr Vronsky; well, we all know his hidden agenda. Perhaps that is what is irritating you. You are not party to it. But we are and that is all that matters. Given enough time in your personal praying chamber, in sober contemplation of your navel, you may too. In the meantime ......

Consider it only a suggestion but ..... I think I hear your friends calling. Oooooh Lurker007. Please follow us.

(Sun Jun 15 1997 17:51)
5,000 dollar gold: HAHAHAHAHA

(Sun Jun 15 1997 17:54)
Nailz: Am tryin to send you a map of Scaterie Island that a one or i at the beginning of your e-mail address?...I keep gettin em returned

(Sun Jun 15 1997 17:59)
BW @14:39: If you would take the time to expand on that thought, I would appreciate it. ie, debt vs ultimate DOW low. It sounds original and intriguing.

(Sun Jun 15 1997 18:09)
I'm extremly sorry but I don't think DOW 250 or Gold 5,000 is REALISTIC!
If either one of these happens,you are all in trouble....It seems the higher the Dow goes the more the resentment grows towards those who made the correct call and MADE money in the stock market...Let's get REAL!

(Sun Jun 15 1997 18:13)
Nailz: Thanks to my should get the map of where all the GOLD is buried...

(Sun Jun 15 1997 18:13)
BW: Yer full of good stuff today. Just loved your 16:06 on the K-rands. Yes indeedy, trust your legal system. The protector of all of our liberties. As long as it doesn't hurt the big money. ... That BTW is the flaw in any discussion of tax reformation. The middle class and the poor are totally unrepresented in such discussions. Better to protect yourself as best you can forget about the political system. It's BANKRUPT.

(Sun Jun 15 1997 18:16)
It sure is bankrupt...Time fer din din...

(Sun Jun 15 1997 18:23)
Stop Dreaming

With a 250 Dow, who would have the money for $5000 gold?
Better have food and shelter and the means to protect it.
Gold at $600 to $1000 is the best bet, until they come to
their senses.

(Sun Jun 15 1997 18:23)
RLM: I know your question was addressed not to me but to George Cole, but the US has tolerated about as much "disinflation" since 1981 as it politically can. In Japan there was a great deal of personal savings to help weather the dinflationary storm. Here we have the government "bailout of everything" mentality. Without handouts there would simply be a revolution bloodier than most. The enormous debt service requirement HAS kept things under control, but it was unable to create true deflation despite its enormity. if rubin loses control of the situation, we will have massive inflation once more.

(Sun Jun 15 1997 18:38)
@ Sunday At The Library (Short Hours)
Earl: Those inflation adjusted charts can be found at ...Scroll down and click on "charts". At the chart page you need to go to near the bottom to find the inflation adjusted chart. LOL.

(Sun Jun 15 1997 18:41)
TO: John Disney
John - do you have any idea why Joel dropped 30cents ( nearly 10% )
on Friday? Thanks.

Steve Puetz
(Sun Jun 15 1997 18:44)
@ criticism regarding global banking
Lurker 007: It seems you don't take too kindly to my work. However, the brewing trouble with banks around the world was not my work -- but I wish it was. Rather, it was an exact quote of a May 7th "Wall Street Journal" front-page story. Go to your local library and look it up.

(Sun Jun 15 1997 18:45)
Crystal Ball.... Got you info and I thank you....Will get it to work...Just in from helping son with maintenance and tune up on his vehicle...It was a 4 beer job with some frustrations and needless to say my first attempt at the site you gave me failed. Saved it and will try later....TED.....Got it !!!!!Fantastic !!!!Wish I could be there,,,You have incoming !!! DUCK !!!

(Sun Jun 15 1997 18:46)
Does anyone remember this speech? I'll give you hint, use your browsers search function and look for 'exuberance'..... Something about a cross of gold in there to. :- )

George S. Cole
(Sun Jun 15 1997 18:52)
historical analogies
Bernie: You also have a strong historical sense. Yes it would be unusual for three such events to occur within a few months of each other. But the 1973-75 bear market ended at about the same time that President Nixon was forced to resign and the U.S. had to leave Vietnam So there are precedents.

RLM: This whole stock market boom has been based on disinflation and a steady swing to the political right. Wholesale prices have fallen for 5 consecutive months; is this not disinflation or possibly even deflation. Leeb is arguing ( correctly in my opinion ) that the ability of the system to keep financial markets booming by ever greater cost compression is coming to an end. Politicians will have to "go for growth" if they are to stay in office. And this has major investment implications -- positive for inflation hedges and small cap stocks, but negative for the blue chip growth stocks that are now so popular.

Steve Puetz
(Sun Jun 15 1997 18:55)
@ gratitude toward others on Kitco
Good job!!! -- Strad Master ( your reply ) , Mike Sheller, and More Gold!!! Strad, your "crybabies" title made me laugh. One thing I have found, the people on Kitco generally have a good sense of humor. In addition, there's lots of good debate along the way.

Over the years, I've become hardened to the verbal-attacks like the one from Lurker 007. Most of the people on Kitco can look at both sides, not being offended and making personal attacks. I try desperately hard to avoid making personal attacks when I disagree with someone -- not just on Kitco, but in everyday life. However, I'm not afraid to diagnose, criticize, and attack IDEAS if I see the logic or reasoning flawed.

I can change my viewpoint, and I frequently do. However, personal attacks have never been the vehicle for changing my mind. To change my mind, I need good REASONS and good LOGIC.

(Sun Jun 15 1997 18:58)
TED.....All those years of not eating fish has caused your eyes to go bad !!!!! Go set a few lobster traps before I get there. I can eat 5 pound and a quarters........It is an "L" but a non-capital one....Glad your wife can see....Get her to put my address in your "address book" and you won't have to look it up every time.....

Steve Puetz
(Sun Jun 15 1997 19:07)
@ predictions of Dow 250
BW: Good posting at 14:39. We all become so accustomed to thinking that current market prices acurately reflecting fair-valued prices, that it's easy to skip historical valuation norms. In addition to dividend yields, book-value is another good measure. Today, the book-value for the Dow Industrials is 1337. That's no typo, see today's Barron's, page MW103, column 4. The book-value is a close approximation of the eqity the companies in the Dow have in their businesses. This valuation method of measuring stock prices has worked well, up until the mania of the 1980s and 1990s took hold.

Eventually, I assume stocks will fall back toward their book value -- they always have in the past. But, in a bear market, stock often under-shoot book-value. If they do this time, something below 1337 seems likely. For now, I'm sticking with my Dow 300 prediction. BW, you're still more bearish than me, but not by much!!!

(Sun Jun 15 1997 19:09)
STEVE PUETZ.....You have been coming to this site about a week and you are already "hooked"....WHEW !!!!You are in trouble !!! Wait until you have to be without your computer for a few days......MAJOR WITHDRAWALS!!! By the way, will you spell out your name phonetically...the Steve part I can handle, it's the other one I can't decide on.....THANKS...

(Sun Jun 15 1997 19:11)
It's already in the address book!....Did ya get the map?

(Sun Jun 15 1997 19:13)
Nailz: Sorry...scrolled back and see ya got it...

Mike Sheller
(Sun Jun 15 1997 19:20)
The Astrological Investor
Steve Puetz: You said it. As an astrologer ( among other things ) I have dispensed with a thin skin early on. But I for one will not stand by while the really significant contributors to a really great forum get trashed by trash. Ideas should be identified and contested by ideas, not personal bu**sh*t. We can police our own forum. And we will do that. TED - sooner $5000 gold than 250 Dow. And I had Sushi for dinner!

(Sun Jun 15 1997 19:23)
To: Disney and all
John Disney - Re: 6/14 @ 02:34 - I must agree that theft is theft regardless of whose face it wears, and your assessment of liberal policies is correct. The next question must then be asked. For those that have read some of my priors, you know I am very big on thinking the next thought, even when, or especially when, the next one makes us uncomfortable. I have added this caveat, not to cast you in this light as you are obviously a well reasoned man, but to share what I consider to be my own political maturation.

I used to consider myself a conservative, and in many ways can still be described as such. This was when I applied the next thought philosophy on a more selective basis. I was often heard to say, to anyone who would listen, "The liberals want what cant be done; they want to legislate compassion." One day I looked beyond those words. If this is true of liberals, is there a similar fundamental truth about conservatives? It than occurred to me that conservatives also want what cant be done; They want to legislate morality.

( I have probably used a semicolon incorrectly twice in the preceding paragraph. I understand that a semicolon is a mark of punctuation used to connect independent clauses and indicating a closer relationship between the clauses than a period does. But I still have no idea how to use one. I am therefore apt to use it whenever I have a chance though this invariably leads to incorrect usage. As a result, I get the same kind of guilty pleasure using a semicolon as I do eating chocolate chip, macadamia nut cookies; They are both weaknesses. Also, I dont think that an entire paragraph should be in parentheses. )

I began looking at the two schools of thought with new eyes. What would happen if I applied the same thinking to other self held platitudes? The liberals want to tax and spend. True, however, the conservatives want to borrow and spend. The liberals cloak themselves in feel good policies regardless of the consequences. The conservatives create policies that make themselves feel good regardless of the consequences. As for power corrupting, both are absolutely corrupted. The line between the parties blurred. They are two sides of one coin.

There is but one party in this country, The Government Party. The GP has only two goals that I can discern; constant accumulation of power, and getting reelected by any means possible so that they can continue to wield that power. Therein lies the blame. We continue to reelect these people. We all share responsibility for the GP.

It is in this understanding of the use of power that one can then make predictions of the future. Within this present framework, a flat tax or a national sales tax will never come to pass. Since when has the GP ever yielded power? The cumbersome, self contradicting tax code is enormously costly. I have read figures recently that US industry spends upwards of 5 billion man hours, and 80 billion dollars spent annually in tax compliance efforts. It would seem self evident that the GP could raise revenue and increase compliance by simplifying this code. But the IRS is the perfect tool to invasively collect as much information as possible on American citizens. Does anyone see the GP discarding this tool? I do not.

The same thinking can be applied the "War On Drugs". If nothing else, history has proven that prohibition never works, as long as the demand is there to undermine it. The confiscation powers granted to the GP under the banner of the WOD are unprecedented in the history of this country, and inherently unconstitutional. Seizures of assets and property are made without due process, before the owner has been convicted of the crimes under which this confiscation has been made. The current regulation under which all cash transactions of $10,000 or more are reported to the IRS, and shared with the DEA, is perfect way for the GP to keep tabs on us all. More than 99% of all such transactions are legal and aboveboard, but we are all subject to search for the fraction of 1% that are not. Does anyone believe that the WOD is the reason for this invasiveness? This is like hunting chipmunks with an machine gun.

Now there is an effort by the Clinton administration to require all computers, telephones, and other communication equipment to carry an "eavesdrop chip". This chip would be mandatory on the manufacture of all new communication equipment. Additionally, law enforcement agencies have requested, and the Supreme Court has agreed to, a relaxation of requirements that must be met for the instigation of a wiretap. This again is under the auspices of the WOD.

One can usually expect others to do what is in their own best interest, and the GP will do whats in its own. The incredible increase of federal powers over the last four decades would have the founders of this county appalled. But we reelect these same GP representatives time and again. One might argue that, in a two party system, this is a pattern doomed to repeat itself. Was it Mark Twain, or maybe Will Rogers, who said, "We get all the democracy we deserve"?

We must all do what is in our own self interest. Obey all laws, pay your taxes, and never be on the wrong side of the GP. Never give them a reason to make an example of you. Buy what financial protection you can while staying within the legal framework set up by the GP. Control your own future, your own destiny. Be there for the endgame.


(Sun Jun 15 1997 19:26)
Panda: A gun that kills....should have been my defense in Vermont! Will also try and catch Frontline Nazi gold program...

Mike Sheller
(Sun Jun 15 1997 19:29)
Papas Fritas
By the way, even though, as a professional marketing and ad man, I know this is a hyped contrivance to sell greeting cards...HAPPY FATHER'S DAY to all to whom that applies. I feel your pain. TED - Spent a day at the beach at Robert Moses State Park on the South Shore of LI yesterday. No porpoises, icebergs, or lobster pots in sight, but nice. Warmer than I thought it would be at the surf. Beach was nice and populated too. Summer's near, and the time is here for dancin' in the street. Won't you think about coming back?

(Sun Jun 15 1997 19:30)
People say gold not rise in us$, big trader say it rise now!
Keep best eye on hk at london open, all week. Comex to
Offer to sell is no take, time gone. No more talk, no more
thoughts for West! Stand down for 4th time, no.
It time now, Trader make times interesting for gold.
Now we see what real. Now we see who real.

(Sun Jun 15 1997 19:30)
Well-reputed Seer asserts gold stocks are as cheap TODAY relative to the market as they were in the early 1970s. See Coles Market Insights - Click RELOAD:

(Sun Jun 15 1997 19:34)
Hi Mike!...Ya got that right about Gold 5,000 before Dow 250...But neither one of us will see either in our lifetimes....SUSHI....oh, My God me the shivers!...Spectacular evening on the ocean and can hear the loons in the distance....

(Sun Jun 15 1997 19:37)
Earl - I agree with your 01:41. Can this be posible?

Mike Sheller
(Sun Jun 15 1997 19:40)
Big Brotherly Advice
RJ: Your post to John Disney was profound and disturbing. I too have no use for either Liberals or Conservatives as they are currently constituted. I concede my compassion level for humanity and my fellow to no liberal, nor do I concede my vision of individual rights to any conservative. The final thought in your exposition is all I might contend with. Having had the Vietcong attempt to kill me on several occasions, and having failed, how can I hold myself back from contending openly with the renegade government that is burgeoning around me like a stultifying cancer? I just watched the Godfather, and Godfather II on TV the past 2 nites. Hmmmm. Maybe discretion, and buying gold is the better part of valor. But it's not easy to swallow. In any event, you have pulled the bandage off the pus-soaked scab very nicely. I thank you for that.

(Sun Jun 15 1997 19:41)
Hi scrolling me way up from the bottom...Sounds nice at Robert Moses State park but was it crowded?...We are finally getting warm weather and even the icebergs are gone...Come back to gotta be kiddin...if you only knew my history in that town!..SUSHI..YECK!
You must be tryin to torment a vegetarian....

(Sun Jun 15 1997 19:47)
FOR THE BEARISHLY INCLINED: long September 900 OEX put ( oewut, ask 49 ) short September 870 OEX put ( oewuj, bid 32 ) . Cost: 17. Presently 30 points in the money. You win if the OEX does not gain more than 13 points by September.

(Sun Jun 15 1997 19:57)
George S. Cole
You think that BT may be for real. But you are not sure.
Others have ignored his comments.
Two months ago I posted a warning to all who trust in paper, all paper.
Last week I warned all about the slaughter of fools.
There was a real concern and fear in London. US media reports nothing. London kept the lid tight. Next two weeks will show all that BT is for real.
Re: future price fo gold, the increase and the speed of increase will shock 99.999% of investors and 98% of gold bulls.
Summer 1997 will go down in history as the begining of geopolitical changes.

(Sun Jun 15 1997 20:14)
Its not personal
Mike Sheller - Interesting you should mention the Godfather. Regarding the last paragraph of my 19:23. Remember, its not personal, its just business. Also remember Vito Corleones reason for turning down Solozzo. He believed that it would destroy them all in the future. Always think of the long term picture. Regarding the Vietcong, with all respect, you may be looking at some things through a very personal lens. I too have had guns fired at me in anger. Not just guns, but artillery, and tank fire. I was part of Reagans dismal failure in Beirut in 1983. The parallel with Vietnam is appropriate. We too had no clear cut military objective. We too were put in a hostile environment with one hand tied behind our backs, hobbled by rules of engagement that were a cruel joke. I saw 283 marines die for no purpose. A belittled and beaten US withdrew with nothing to show for the blood. I do realize though, to quote S. E. Hinton, "that was then, this is now". I have many friends that are Vietnam Vets. To them, and to you, I want to say thanks.

Something I wrote in Beirut as 16" shells from the New Jersey flew over my head. The meter is a bit forced, but I was young then:

The clouds hide the moon
So I turn on the light
On a roof in Beirut
On a balmy night
With the sound of the fight
Echoing nearby
The bombs exploding
Artillery scolding
The pen Im holding

Lets dance, says Bowie
on the radio by
I suppress a sigh
And a silent cry
For those who die
By and by
Without knowing why

Its been said
That dead is dead
when a hot piece of lead
Blows off your head
Off you go
And dont you know
Around your toe
They hang a tag
And shove your remains
In a brown zippered bag

The Americans, the French,
The Italians and Brits
They must be here
For grins and shits
Cause this aint the Ritz

And now I think
I understand
The best laid plans
Of mice and men
Are still just hit and miss
So I sit and stare
At the rockets red glare
On the roof of a hotel
In a country thats going nowhere.

(Sun Jun 15 1997 20:21)
Neck High
Bob M: With regard to the folks who have been buried in gold since the 1980's I don't think they will leap into selling as soon as they can break even or make a small profit after 20 years. If I'm any measure I can not disregared the bank or bond let alone stock market loss that has occurr while I awaited the financial or other calamity that would have make gold a good investment. But it is so much of a loss that gold at $500 or even back to 800 is a drop in the bucket. Gold bought 15-20 years ago is a loss unless the bizare revaluations to 5000 or 10000 or 35000 an oz suddenly show up. Some will sieze the opportunity to get out of a bad investment at some predetermined figure set 15-20 years ago but its much like house insurance if there is no calamity the premiums are a loss.

(Sun Jun 15 1997 20:28)
RJ: Profound post. If there is no one to vote for, there is always one to vote against. ALWAYS VOTE AGAINST THE INCUMBENT.

(Sun Jun 15 1997 20:28)
HEY BART.....That B&^L SH&T filter you sold me for $17.95 is starting to fail....Enclosed is a check for another one. Please either hurry with it or assign us all a permanent handle so some can't post under different handles ( yes multiples ) .

(Sun Jun 15 1997 20:31)
Their are a few articles at this URL about China take-over of Hong Kong.
Some Western diplomats are going to be boycotting part of the ceremony, but the Chinese are going to do it their way.

HUGE celebrations are planned in Beijing. Chinese not sorry ( understatement ) to see the British off their soil.

This stuff is pertinent to BT, simpleman posts below. China is most decidedly not part of the G7.

(Sun Jun 15 1997 20:53)
Aurophile/GS Cole
Aurophile... Always appreciate your input! You said:
In Japan there was a great deal of personal savings to help weather the disinflationary storm. Here we have the government "bailout of everything" mentality. George reminded us of the latest government statistics:
Wholesale prices have fallen for 5 consecutive months; is this not disinflation or possibly even deflation.

First off Im a gold bug, so inflation would not make me unhappy ;- )
I appreciate your perspective on the difference between the more financially independent Japanese, and the government addicted Americans ( let the government fix it ) . This would argue for inflation here versus allowing deflation there. But with the string of wholesale price declines, my CONCERN was that we were slipping into deflation. I believe you, and George and Leeb are arguing that these numbers will be the impetus ( fear of the resulting "riots" ) to force government to soon react by injecting money into the system which would reignite inflation. Ive been a deflationist, the three of you have impacted that thinking. Thanks.

(Sun Jun 15 1997 20:54)
Aurophile/GS Cole
Aurophile... Always appreciate your input! You said:
In Japan there was a great deal of personal savings to help weather the disinflationary storm. Here we have the government "bailout of everything" mentality. George reminded us of the latest government statistics:
Wholesale prices have fallen for 5 consecutive months; is this not disinflation or possibly even deflation.

First off Im a gold bug, so inflation would not make me unhappy ;- )
I appreciate your perspective on the difference between the more financially independent Japanese, and the government addicted Americans ( let the government fix it ) . This would argue for inflation here versus allowing deflation there. But with the string of wholesale price declines, my CONCERN was that we were slipping into deflation. I believe you, and George and Leeb are arguing that these numbers will be the impetus ( fear of the resulting "riots" ) to force government to soon react by injecting money into the system which would reignite inflation. Ive been a deflationist, the three of you have impacted that thinking. Thanks.

(Sun Jun 15 1997 20:55)
Sorry for the double post. Didn't look like the first one worked.

(Sun Jun 15 1997 21:03)
To RJ, I enjoyed your post of 6/15; 19:23. Big government can exert only so much control and wealth shifting until ATLAS SHRUGS. You may have read Ayan Rand's "Atlas Shrugged". You sound a lot like her. In her book she has a Bre-X type swindel which is the beginning of a big gold run-up.

(Sun Jun 15 1997 21:08)
EBN Gold down a nickle and Dollar mixed....

(Sun Jun 15 1997 21:13)
The financial markets are now like Jurassic Park. Complex systems and fences control vast economic forces. Chaos Theory dictates that the more complex a system the more likely it is to fall into chaos. Nobody will control the economic markets after they break loose. The Central Bank must be in a panic to start that rumor about gold sales. It sounds like something very big may be coming down. What can be so big as to cause the Central Bank to panic?

(Sun Jun 15 1997 21:27)
RJ: Regarding your earlier question; I don't know why it should be surprising that we are in close agreement on volume making all the difference in ( any ) market. That should be self evident though it is overlooked, occasionally. I have agreed with most everyone of your posts and especially today at 19:23. I learn more than I'm able to contribute. Please continue.

(Sun Jun 15 1997 21:32)
@New England
GOOD POINT GENE: They do seem to be preoccupied with mkt behavior which tells you they know the risks are growing.

Deflation + ( Big Debt + Financial Mkt bubble ) = Depression + Default + Ballooning Deficit + Flight from Reserve currency + Gold Explodes. Deflation is taking over and this is what CB s are worried about. Stk mkt rallies may be an attempt at reliquification which is too narrow to work.
Constantly talking of gold sales is they want to keep the cat in the bag. The last eleven weeks in Gold and silver look like markets under intense control. And... Why even when they are heading up is there always a selloff at the end of the day...HMM. The action tonight looks like another 340 go below early in the week. I believe any significant rally in gold like 5 bucks would send Dow down big time.

The story they put out requires continual market obedience. Remember, they dont want recession talk ( which is beginning because of debt ) , Stk mkt rally stops this psychology from developing ( maybe ) . What happened to Greenspan's irrational exuberance? ) HMM. Stron Mkt helps Keep desparately needed Capital flowing to US to buy the massive amount of Treasuries for sale. ( new and Refi ) .

Steve Puetz
(Sun Jun 15 1997 22:01)
@ pronunciation
Nailz: Pronounce as "Pitts" -- it's a German name. You're right, I'm hooked. This is the 3rd time today I've been on Kitco-chat.

Mike Sheller
(Sun Jun 15 1997 22:03)
RJ: Thanks for sharing the poem. I have one for you, but not tonite. Yours meant a lot. I salute you.

(Sun Jun 15 1997 22:05)
Mike - Words to vote by.

(Sun Jun 15 1997 22:10)
Mike Sheller - Prior to Mike @ 20:28, Was that you or another mike? Re: your last, The only proper response to a salute is to return it.

Lan Man
(Sun Jun 15 1997 22:14)
Aurophile: Whats the latest on the "DTTI"?

(Sun Jun 15 1997 22:16)
STEVE PUETZ.........Am I ever glad to pronounce "Pitts". You wouldn't believe some of the ones floating in my mind....Why there is ole TED and sometimes I have a hard time with that one....Is there any great philosophy coming on here tonight ???? If so it is going to have to come soon or wait until the morning for me....The sandman is throwing sand in the eyes as we speak...

Steve Puetz
(Sun Jun 15 1997 22:23)
@ deflation
WW: Deflationary forces do seem to be taking over. Retail sales down 3 months in a row. PPI down 5 months in a row -- which establishment press proclaims meaning that inflationary pressures are absent, rather than outright deflation.

(Sun Jun 15 1997 22:29)
Hong Kong under China control. Can this really be a non-event in the
financial world? Doesn't Hong Kong have the highest number of billionaires
in the world? Maybe a little run on the London gold market isn't so
unbelievable. Revenge is powerful motovator.

(Sun Jun 15 1997 22:32)
Zero Hour
Big Trader has taken his stand. It's now or never. Ante up.

Strad Master
(Sun Jun 15 1997 22:36)
EARL: Your extremely kind comments about me are truly humbling, especially in the light of so many fine individuals who regularly post here. You give me much to live up to and I am honored.

(Sun Jun 15 1997 22:36)
I guess we'll find out, as best we can, whether BT is real or not.

(Sun Jun 15 1997 22:37)
Hope your right, no irrational exuberance here.....
I will be cheering the Dow on from this point on. I really hope it continues up strong, the stronger the better.
The 8000 to 8500 level is not inconcievable.
This market feels like it's just aproaching the summit, and this is the final push to the top, where all the late investors are clammoring to get in ( notice the Europeans ) , not to be outdone by others using credit cards to buy in.
Once at the top, no matter what direction you look, there is only one way to go, DOWN.
Go Dow Go..........

(Sun Jun 15 1997 22:40)
If we are to believe BT is for real, then am I to assume that the only way to play, if that is the right word, is with the real stuff? Paper of all sorts is headed for Big Trouble? Comments anyone? ( FWIW, anyone who doesn't have at least some physicals should get some, just because you never know. )

(Sun Jun 15 1997 22:41)
@New England
Sorry Guys but China taking over HK will at least be a short term positive for HK mkt. If there was worry it wouldnt be going up now. Further, The HK billionaires will front for the Reds to get Capital for the mainland through HK mkt. After REDS get the development they want they will take over at a cheap price/HK billionaires will get a commission and cheap labor for serving the reds.

Our Guys want to invest in China but fear lack of control over their investment if reds want to do a number on them. ERGO US Govt inconsistent policy of appeasement. These boys are robbing our technology and our capitalists are STILL frantic not to get them po'd. The reds always say the Capitalist will hang himself with his own rope. For the hope of short term profit and of tapping Chinese mkt ( really they are tapping ours as they have the surplus ) the Reds observation is playing out to a tune or more aptly TOON.

Strad Master
(Sun Jun 15 1997 22:47)
Great postings!
MIKE SHELLER & RJ: Your postings are always thought-provoking and instructional. I found, though, your recent dialogue about your military experience to be profoundly moving. While I was never in the military I have the UTMOST respect for those of you who were and who endured privation and even terror for the sake of causes you may have not fully agreed with. To you and others with similar experiences I wish to say, "Thank you!"

(Sun Jun 15 1997 22:51)
WW: How come the China/HK billionaire connection wasn't established
last year or 5 years ago?

Steve (Perth - Western Australia)
(Sun Jun 15 1997 22:51)
Tough Times Predicted for Equities & Bond Markets ( Bankers Trust )
Check site:
The wealthy Myer Family sold 1% of their Australian national grocery chain on Friday following strong growth in the stock price in the past few months. Affluent investors taking some profits...old chap...

(Sun Jun 15 1997 22:58)
Vronsky - RE: your 14:58: I've never had a button before! Strad - thanks. I'm starting to feel like one of the guys. Who would have guessed with my rather unconventional in your face introduction to this group.

Strad Master
(Sun Jun 15 1997 23:02)
Waiting, Watching, & Wondering
STEVE PUETZ: I'm glad you so enjoyed my comments. You are a very valued asset to the Kitco site and I always look forward to your postings. I have a question about your response to me regarding the numbers you posted for me a few days ago. Those valuations are all SO much bigger than the equivalent numbers in '29 or '87. It seems that they are disproportionately higher which leads me to wonder if there hasn't, indeed, been some sort of seminal change in the way markets work. Having lost a LOT of money already waiting for the market to turn and for the metals to get going to the upside, I always read such valuation numbers with a mix of dread and glee, yet month after month, nothing ever seems to change and the markets just continue to do the exact opposite of what logic would seem to suggest. The explanation I have always heard is that the farther the markets get out of proportion, the bigger the coming crash, yet that too has been said for years. I'm sure there's an easy explanation for this so I look forward to your reply. Thanks

(Sun Jun 15 1997 23:06)
Panda @22:40: Paper versus stuff? I have been trying to generate some interest in that thread for the past couple of days. Given all the potential pitfalls in the world today, I do think it is a question that should be pondered more seriously. Everyone would like to extract that extra pound of leveraged flesh, because it always worked in the past. Maybe it won't, this time. ..... But hell, I'm congenital cassandra. The glass is never half full. It's always half empty.

(Sun Jun 15 1997 23:13)
Thanks For a Good Read
RJ, Mike S, Earl, Steve, Geo., Ted, Strad and others too numerous to mention: I have just reviewed and I want to knowledge my appreciation and thanks for the insight and exemplary humanity which your posts have so profoundly demonstrated. And BT, whoever and where ever you are, I sure hope you are right.

Strad Master
(Sun Jun 15 1997 23:18)
Just one of the guys...
RJ: You are, indeed, one of the guys ( and gals - we can't leave out Auroelf ) . I, for one, didn't find your initial postings to be at all "in your face" as you characterize them. A sincere posting here at Kitco, backed by sound thought and experience as yours obviously were, will always be met by acceptance and respect. As you may have noted while lurking, others ocassionally posted contrary opinion and were summarily shot down. I think that was more a function of the writer's aggresive and combative style of posting than of the opinions expressed. You are a gentleman and so didn't approach it that way. Besides, your writing style is so lovely that even if you were wrong ( which I suspect you are not ) your postings would be a joy to read. I only wish that 1. ) you had started posting a lot sooner and 2. ) I hadn't gotten into metals until AFTER I started frequenting Kitco. I'd be financially a lot better off right now.

(Sun Jun 15 1997 23:24)
Vieserre: Thank YOU for posting!...EBN Gold up .15 and Silver up 1 cent..
Dollar down against most currencies except the Portugese Escudo that is plungin ( down 1.32% ) ....

Strad Master
(Sun Jun 15 1997 23:26)
A little Strad on the way!
ALL: As it is still Father's Day ( happy wishes to all of you ) I want to use this forum to announce that The Strad's are expecting a new little sound generator in late January. ( No. 3 ) ( Please forgive me, Bart, since this isn't gold-related but when there exists an international forum of close friends it is difficult to resit the temptation! ) Needless to say, we are ecstatic!

Steve (Perth - Western Australia)
(Sun Jun 15 1997 23:27)
BERNIE: Excellent post re "foundations" belonging to the Super Rich.
We have been examining these for a while now. Even the famous Myer family in Australia seem to have one set up. The way to stop these tax evasion foundations is to ensure that the next generation of the super rich ( ie the kids ) are legally prevented from being beneficiaries of a foundation. I noted that President Kennedy's children got a handy little pay out of their family foundation recently. While I would like to stop these foundations entirely that throw a lot of money at rather dubious causes, this is not likely.

(Sun Jun 15 1997 23:30)
Happy Father's Day All!
Been quite busy for a few days and so am just beginning at Friday's comments to try and catch up when I noticed the Strad Master's question about 'what will MAKE the market ( stocks ) fall - their own weight or what?' Well I don't know yet if this question was pursued any further than Friday night, or if anybody has said exactly what I'm about to, but here goes. I agree with WW New England's comment that eventually it will be supply and demand, ( because, when you get right down to it, that is always the ultimate factor in setting price levels ) , that causes the market to drop.
What I have to add is that IF nothing untoward, ( or unexpected ) , happens in the Political, or Environmental realms First, that causes the Supply to increase ( # of willing Sellers ) and the Demand to drop ( # of willing Buyers ) , then I believe that the economic factor that will trigger the turning point will be the raising of interest rates. Remember this recent very minor increase was what caused the very temporary 'correction' that we recently had in the stock markets. The easing of the interest rate increase fears has now taken us to further lofty heights. The next increase of rates should definitely be the pin that pricks the balloon.

Steve Puetz
(Sun Jun 15 1997 23:32)
@ Strad Master
Strad: The one ingrediant that we have now in much bigger doses than we did in either 1929 or 1987, in a word -- LEVERAGE. The DJIA never could have risen so far without massive amounts of borrowed money pushing it up. "Swaps Monitor" estimates global derivative open-interest at just short of $60 trillion -- 12 times the US government debt!!! NYSE Margin Debt, credit card debt, mortgage refinancings have all gone into stock in varying degrees. When stocks finally do turn lower, the mother of all "MARGIN CALLS" will be unleashed.

About 15 years ago, I was on the wrong side of a pork-belly trade when pork-bellies locked limit for several days in a row. I can tell from personal experience, being leveraged on the wrong side of a trade and not being able to get out -- that is one of the worst feelings in the world.

Now, we have circuit breakers gallor on the NYSE and S&P futures. There is no doubt that once the market breaks enough, the margin calls will come, the circuit breakers will pop, and millions of leveraged stock players will be trapped in stocks with no way of getting out.

It's sort of like "Field of Dreams": Give them the margin money, and the margin calls shall come.

(Sun Jun 15 1997 23:44)
It's A Small Kitco World Afterall! I'm off composing a post about Strad and come back on to see he's been active ( in more ways then one! ) . Congratulations Strad Master and Mrs. Strad!

(Sun Jun 15 1997 23:45)
EBN Gold up .20 and Silver up 1 cent....we're headed in the right direction...Goodnight all!

(Sun Jun 15 1997 23:53)
Strad @23:18: I'll drink to that. Most especially, your statement #2.

John Disney
(Sun Jun 15 1997 23:55)
Five AM on a frosty African morning. Ive been reading
"the site" - as I dig into my papaya and black coffee. I
can only say that you people were at your creative
best EVER over this weekend. I am stunned but inspired
by you.
First to Duncan who asked why Joel fell thirty cents
on friday. Look Duncan, how do I know?? I assume that it
was maybe thirty cents too high on thursday. When my
stocks fall unexpectedly by large percentages, I
usually attribute this to the work of the Prince of
Darkness and the Antichrist working together against me
in fearsome harmony. I suspect this may be the problem
in your case but I hope not. But be careful crossing
I have avoided Joel. I was in it a two years ago to
get in on their one for one stock issue at 2.5 rands. I
then sold out at 5. With gold like it is, I assumed
that a gold stock can only have so many goodies like
that in it. Also I believe that on a cost of reserves
basis they are about 5 or 6 times more expensive than
durban deep or Harmony ( "fearsome harmony" - see above - could
this be an OMEN ? ) .
You will recall my earlier references to Lebowa
platinum I hope. Well they were just merged with
PP- rust and amplats. The latter two got a premium
of 10-15% over market. Leplat got a premium of over
50% and I had stacks. About a month ago you could have
bought for as low a 2.5 and I sold it all last week for
4.45-4.5. It was my only platinum stock and I hope Im not kicking
myself next week.
I guess my main reason for selling was to get out
before the dreaded P of D did the same thing to me that
he did to your Joel.