AMIGO EARL: IN REF TO "Earl ( @worldaccessnet.com ) :
George S. Cole @19:22: Your comments sound almost like a call to arms. I like that idea. I only wish my purse were equal to the contest."

With all due respect we can make a difference with our rhetoric! And yours is the loudest and sharpest of all. Earl, NOBLESSE OBLIGE! JOIN THE CORPS. TAKE UP THE BATON... A leader is needed!

But wouldn't it have been great to short the market? You should consider it now. With everyone pushing it down to the ( inevitable? ) $250 mark. Use options??? What the hell...

World Worst Investor - You have been on the long side? Perhaps you should jump the fence and MAKE $1000/day over in the neighbors backyard? The quote should read: "the trend COULD be you're friend". So go and buddy-up!

I'm sorry all bugs. But can't you still be a goldbug and make money from the other side? I like these markets because you CAN make money either way! AWAY

EB

remember those Laker/Celtic championships??

Laker-EB: It would look like a pure stroke of genius if I had shorted from 380 to 320. I think 320 to 275 would be a great move too. But not sitting long expecting a rise as the price declined is the best I could do.
BTW Laker is a good beer for the money--in Ontario.

On June 24 someone posted some "Historic Paradigms" which
all turned out to be false. Our Government is famous for
feeding the general public such pap. Word War I comes to
mind. It was the war to end all wars.

It occurs to me that the powers are trying a tad too hard
to turn gold into a commodity. It can't be done. Not
much has been written about the "Pacific Rim" economy.
That is where the future action is at/going to be. If it
hasn't allready arrived. It has been said here many times
the poor asian working man will buy a gold trinket just
as soon as he can scrape enough paper together. , etc.

The only way the has been Europeans can put it all together
is by forming a gold reserve for the various countries.
Gold is the only equalizer. Paper tiers, in what ever
form is not/will not form a European currency ( EC ) . The
paper house of cards will collape as it all ways has.

If you did than why don't you beat on it some more... It will be a good day when the Japanese find out the truth about the Russkies. Anything exciting to share?

Anyway I have some corn to shuck ( schuck?, sp? ) and some soybeans to mash and some wheat to thrash...oh my!

away:+ ) )

EB

Good Point! As you say those who have something to say -say it. Those who have nothing to say -- say it--again and again and again. Revealing all.

rt--

your chart gave a rise in the levis! this interpetation
caused a lot of long, hard thoughts to come and go.

there is something quite sensual about gold, and i'd like
to put my hand on it. ( the gold, the gold! ) there is no doubt
time is working to cloister enough energy into what will be
an un-believable rally. there will be so much volatility the
price of a futures contract will be too high for the ordinary
investor to participate unless already in. options will be equally
expensive.

what's the solution? buy gold options now. every month buy several.
insurance is seldom this cheap. will the rest of rosens' hair fall-out
when he has to pay 100k or better for the options he sold for $30.00
or less? i think not. the skin, is where i'll begin.

remember when the oil industry went bust? there was a mindset of
total gloom and doom. look at the industry now. it is going
full steam ahead. this is indicative of life as a whole.
feast then famine. the pendulum waits for no-man.
"but it was'nt the bullet that laid him to rest, it was the low
spark of high-heeled boys." ( traffic )

ok it WAS me. on the grain-train--------again-------!; ) ----------

Schippi - nice chart. Captures the bounce well. Terry / Speed - Tell everyone in Australia they're a day off.

D.A.: Ya got heart!

It is harder and more expensive to move the Dow from 7000 to 8000, than it is to go from 6000 to 7000. Cash inflows into MFs are still high but not as high as last year. So my question is, where is the money coming from to move the Dow up 24% in less than three months? Are the MFs using derivitives or bank loans based on the value of their stocks?

EB: You have a valid point there, it doesn't matter to me which way
gold moves as long as I am going the same direction.
I went long 7/3/97 if that gives you some perspective to my
phenominal timing. Tort: We need you're morning jokes!

Am just waiting for the PGMs. There is a fat Russian lady warming her pipes as I type, she will sing soon. Still own Lots-O-PL, most hedged with short gold. I feel good, I feel safe. Nothing makes a trader feel so good as having the gods and the inevitable tide of history on his side.

Well, you can still pull out and go south!

away...to the south!

EB

cherokee - I was just listening to Traffic while in traffic today...what a great album that was. Steve Winwood was ahead of his time...at that time! Remember Lp's?

Worlds Worst - The sin is not in making a bad trade, but in not calling it thus. You must pull out from under the crawl space and drag it into the sunlight, out in the front yard where all the neighbors can see. Then, as you proclaim it to the world, you drive a stake through the heart of the trade and bury it face down so it does not rise again. Once, having exorcised this demon trade, you are free to get on the right side and let the cool, gently rushing currents carry you with calm assurance to greater prosperity. Then you may shed the World Worst moniker and take your seat at the banquet of profiteers, for the only prerequisite to dine with us, is not to have been wrong, but rather to have been right more than you were wrong.. We will raise our glasses to toast and salute as we drink our good fortunes, and then to remember, in gentle sorrow, those who could not be there with us.

Kitco prices say gold down .80 across the Pacific. Actually, Kitco prices dont "say" anything, so let me rephrase: Kitco prices read: - .80 overseas. If Kitco prices could "say" anything, Im sure it would be akin to OUCH.

Not to fear kitconites. The ultimate contrarian test has been conducted.
I painted 36 squares on a board in which only 1 said short.
My chicken has confirmed by her dropping, yep she hit the short.
Gold shall rise sunny side up. Goodnite!

There once was a Russian w/ precious metal
and he sold it all for fish in a kettle
now there's no more
and it's time to even the score
For all those who have the great mettle

AWAY!

EB

Worlds Greatest - It would seem you have a rare bird indeed. A counter contrarian. The trick is not the dropping, but in recognizing what it means.

for dragging my silver into that dark, dank crawl space under the house. Leave it alone!!!!!!

AWAY!!!

eb

The gang at Kitco still believe
Their long gold still may achieve
They will encounter tomorrow
Metric tons of sorrow
For gold will grant no reprieve

There are some who seem quite amazed
That gold demonstrates such malaise
They learn this and that
But care not for the facts
And use not their minds, but their cajones.

I smoke a mean turkey. And I can bring some of that "tripe" you were talking about. It's not too bad on the barby.

Cheers to all GOOD trades!

away...to the smoker with bad trades

EB

This came across my netminder the other day: http://www.iepstein.com/mletters/options/options.html

a w a y:::EB

RJ,
Below is the feeling around over here, ( correct me if i am wrong ) !
many goldsmiths,manufactures,dealers been hit by the recently slide of gold price.More the forex exchage rate over mal/thai/sin/phi been hit by speculations movement.With this,in deeper mind,we still felt the gold price may declined as you mentioned.most of whom i know still did'nt covered their positions yet.I think both try to gained the profit from metal and covered the lost in the currency exchage rate.
sorry abt poor grammar ( try my best next time )
happy trading!
rgds,
jin

ALL: For what it's worth, today I got a special flash update from The Elliot Wave Theorist about gold as an indicator of the coming deflation. As usual it is full of arcane numbers and letters but if I can mange to accurately summarize the main point, it is that gold has decisively broken down out of a contracting trangle consolodation starting in '82 or '83 and " the July 3rd break under the 1993 low of $325 confirms that this next big leg of the bear market is underway." They state further: "Since being allowed to trade freeely in 1970, gold has ben a reliable indicator of inflation/deflation trends." "The relative weakness over the last eighteen months and last week's price breakdown are warning loud and clear that deflation is now the monetary trend." They see deflation moving the market for gold down to just above $100 ( eventually ) with a nearer term target of $196 - $216. ( All this over the course of several years. ) After the eventual bottom THEN they see gold soaring up as it returns to favor once it "regains its status as the ultimate money." Given how far off Prechter and EWT has been in recent years this all needs to be taken with a sizeable cube of salt. Nevertheless, I thought many here would find it interesting.

Good evening everyone. I just finished work for the night. I have a few days off now. I would like to ask RJ his opinion on something. What do you think the high in gold will be between now and the year 2000?

I went golfing today with a guy who told me the safest place to invest
money was in a Mutual Fund. I asked why? His answer was educational:
"You see, these here Mutual Funds take money from thousands of people
and divide it up into pieces. Then they buy a stock with each peice.
This way, you divide the risk up between all the investors and all
the different stocks. It's the safest investment you can make. And
the returns are really good. I got 26% last quarter!! " If I didn't
know any better - I would of thought he was a broker. No just a baby
boomer engineer who is up to his neck in debt and believes the market
will set him up for life. Instead of following up this line of conversation
I decided it was time to let the big dog eat. 280 and split the fairway.

Dear RJ, while I have enjoyed some of your ditties, unless you can curb some of your late night excess you will never be a writer. I do believe you are the DR Jekyll to the hepcats Mr Hyde, or tonight rather the reverse. I do believe you have been in the hooch and hiked your skirt too much, exposing your true nature. Talent in and of itself is nothing without integrity.

KGB: I just wanted to thank you for the fine work you did last week
with those trucks heading out your country. You did miss one though.
It cost me a few $$. But I know you'll correct the situation. Keep
up the good work. I did hear a rumor about another attempt to get
that fine white metal across the sea. But then, its just a rumor.

D.A. : welcome back - hope you enjoyed your R&R. I was surprised to
hear you joined the gold bugs today. I would of figured you would
of jumped on the platinum ship with it under $400.

Terry ( 22:46 ) All governments say that, and when it happens they blame it on the gold-bugs.
Refering to the us goldbugs: Remember when the US was considering taxing non productive assets.
Sometimes I wonder if those present companies with sales 100 times their market cap's fit as "non productive assets", especially if the market tanks. Quess, we can't tax losses.

I posted this weekend regarding buying gold ( thank you scotty for your reply, btw ) . I would like to get your take, again ( I don't think you tire of these explanations ) on why and how much PM's should one have in their portfolio. Is numismatic a good way to go? You seem to have a good handle on the subject and are not afraid to voice your opinions. Much appreciated. I am also looking/waiting for a nice kitcoite to post good places to buy precious metals. There were a few good posts in the past but I am to lazy to look back. Thanks anyone.

kuston-280 and split? How was the second shot?

away-eb

Terry: Insert "dont happen" for happens

Did you see Rubin sweating out comments about US trade with Mexico on C-SPAN??? Also, check out http://www.ft.com
register -it's free so far. Then browse around for stories in their weekend edition. HAR HAR HAR and a bottle of Jamaican Rum - good stuff.

Doesn't inflation cut both ways. What I mean to say is, if 100,000 stock brokers whose earnings total about $10 billion annually; lose their jobs and then pick up work that totals $2.5 billion annually. Isn't that inflation -at least for them???

kuston: The guy you were golfing with and his logic has millions for company. Try and tell me the big guy with the shears isn't just around the corner, unfortunately. We will all pay a price for this folly.

Jack: Those 100,000 brokers would call it Depression : )

EB: Monex, Blanchard, Jefferson Coin and Bullion, and compare with Kitco. Blanchard in New Orleans - 1 800 880 4653 Jefferson Coin & Bullion ( New home of Jim Blanchard ) 1 800 877 8847. Dallas Gold and Silver Exchange is good too. I don't have all of the numbers handy. Search on Coins and you'll get lots of hits. Ask about availability and shipping times, then post to Bill Buckler here or at the Privateer. Research is ongoing about demand for bullion at the retail level.

JIN @ 02:41--You must have done well. Congratulations! What is your guess, JIN, as to the high in gold between now and the year 2000? Good night and good fortune.

WDL: ( 21:22 ) re Arch Crawford "Stocks are vulnerable." You don't need to be an astrologer to figure THAT one out. EB: You speakin' to me? I don't do numismatics. I'm down n' dirty - like gold bullion & the shares. What percentage? All depends on your point of view, your analytical underpinnings, and your faith. Every citizen should begin buying gold bullion coins NOW, if they haven't begun already. Maple Leafs, K Rands, etc. Dollar cost averaging over the next year will be nice. STRAD MASTER: ( 2:50 ) re this talk of $100 gold - there's a saying in Spanish about predicting what will happen that translates "They see the balls, they know it's a boy." The analogy of a baby being born is not too far off here. Inasmuch as gold is in the gutter now, everyone figures gold will continue to go down, while stocks will continue to go up. Yeah, right. When this kind of talk is common, one has to figure the baby's been born.
ROEBEAR & RJ: Let's not start anything now...

Slow morning for ForEx news :- )

G7 gets edgy but seen holding off on big FX battle,
http://biz.yahoo.com/finance/97/07/15/z0009_49.html

Indonesia 'loosening the bands'.
http://biz.yahoo.com/finance/97/07/15/z0009_3.html

Japan bank group says Thailand has not sought aid.
http://biz.yahoo.com/finance/97/07/15/z0009_10.html

Russia say s PGMs on the move.
http://biz.yahoo.com/finance/97/07/15/y0023_z00_2.html

Matsushita Elec says worried over Asia forex woes,
http://biz.yahoo.com/finance/97/07/15/mc_z0009_1.html

Thai crisis not forcing Japan firms to alter plans. :- ) )
http://biz.yahoo.com/finance/97/07/15/sne_z0009_3.html

Forex market overreacting, says Waigel,
http://biz.yahoo.com/finance/97/07/15/z0009_40.html

Dollar/mark slips in Europe on Waigel comments,
http://biz.yahoo.com/finance/97/07/15/z0006_z00_1.html

Thai car makers to raise prices as baht tumbles,
http://biz.yahoo.com/finance/97/07/15/y0003_z00_2.html

AURIC,
Good evening to you.
actually,i am none qualified investors in here.I am goldsmith and off course always bullish on my own asset and properties.BUT,some how i prefered to the market movement.As many gurus been mentioned here:"believed the market,treat them well!".for short term,i feel this market will still negative. ( but who know? ) in long term,i still stand firm the precious metals are the good investments in future.
some teaching from buddist:"EVERYTHINGS ARE IMPERMENENCE !",except this sentence.NOTHINGS HOLD FOR EVER!with this kind of mind,i think is make oneself more comfortable in investments and life time,isnt?
rgds, HAPPY TRADING.....TAKE CARE....
jin ( young learner )

JIN--I just KNEW you were a gold bug at heart! How high do you think gold will be by the year 2000?

ALL:

Instead of Anglo Saxon financial establishment, I should have said the financial establishment of the english-speaking countries. Obviously, this establishment includes people from a number of ethnic backgrounds.

Being a study of history, the current state of the gold war is analogous in many ways to developments in the Soviet Union after Hitler invaded in 1941. The Germans won an astonishing number of huge victories in the war's early phases and pushed to the brink of Moscow. Everyone assumed their total victory was just a matter of time.

But everyone was mistaken. As they pushed deeper into Russia the Nazi supply lines became overextended and their forces grew vulnerable to devastating counterattacks.

Isn't this where we are today in the gold war? The shorts have won a series of smashing victories, but are growing ever more vulnerable to devastating counterattacks. They have to expend ever greater financial resources to keep the yellow going down as the price falls. It is just a matter of time before they fall prey to a massive counterattack which will wound them as severely as the Nazis were mauled at Stalingrad.

Despite their big victories to date they are going to lose the war and lose very badly.

I'm back from vacation and the gold and silver markets look as sick as ever, but like the following joke I don't wan't to complain too much about it because it is a buying opportunity.

A middle-class man decides to go off and join a monastery which requires an oath of silence. No speech is allowed except for two words every 5 years, to sum up one's experiences to the head monk.

After the first 5 years, the monk asked him what two words described his experiences and all he said was "HARD BEDS."

When the next 5 year period came, the monk asked how things were and he replied "BAD FOOD."

After 5 more years, he walked up to the monk and said, "I QUIT!"

The monk nodded and muttered "Yes, this doesn't surprise me. You've been doing nothing but complaining for the past 15 years!"

...is it the West Coast air that is blinding you?...or is it the golden shine, which YOU KNOW will be brighter soon ( 6-9 months ) ?....the funds have picked their spot...weak summer demand...it'll be a little stronger by the end of August...provided nothing major or minor , say 10-15% correction in the Dow...or a little spillover in the Forex...then a little rally say $350 may happen sooner, as it is not Natural Forces bringing gold down, but excessive fund shorting. Your $275 may occur BUT NOT FOR THE REASONS YOU EXPECT OR IMAGINE...$275 is a MAJOR SUPPORT area ( even Peter Munk, seems to wish it ) and if does, the REAL FUN will start...and their greatest fear will materialize! Dare if you must!
Isn't it ironic that this nonsensical yapping of CB Sales, is only accepted only by those who have FEAR and probably invested in "pyramid schemes" or oppurtunists who advantage themeselves of "temporary political decisions" ...FEAR...its the reason that some don't respond to challenges!

Kuston:

Since I spend my life being disciplined, following systems and rules, every once in awhile its time to take a flyer. The only discipline that I bring to being a gold bug at the moment is that my position size is managable and my risk is no more than $320 / oz. This may seem silly, but one of the things that I've learned over the years is not to short commodities, any of them. Believe it or not, always being long commodities in a disciplined fashion is a winning game over time.

What kind of handicap do you carry around? 280 and down the middle sounds like a player to me. Perhaps some day we can beat the little white ball together.

!

George S. Cole:

I love it. Remember the Alamo! Glory, Glory, hallelujah.......

...re your $250?...can you perhaps expand on as to the effect of your $250, on the stock markets around the world, such as the TSE which are dominated by gold stocks...what would happen to investments by non-gold mutual funds who are invested in say Top 100 Index?...If $250 or $275 does occur rest assured that its consequences will be felt not only by the precious metal mutual funds but it'll be a cause and effect onto other markets...and GOLD WILL rise in value!

The big gun speaks;
http://biz.yahoo.com/finance/97/07/15/z0009_55.html

I don't like gold.
http://biz.yahoo.com/finance/97/07/15/z0009_57.html

PGMs and Degussa, things O.K.?
http://biz.yahoo.com/finance/97/07/15/y0003_y00_2.html

Geeez, talk about talking gold down! They must be afraid of something.

I was watching last night on sat-tv a biography of the Dow Jones. The mentioned that after the '29 crash, the Securities Exchange
Commission was founded, primarily to prevent BANKS from selling stocks in the form of MUTUAL FUNDS. hmmmmmmmmmm

Sakakibara said: ``Gold's lustre has declined and I have
no interest in gold now.''

No doubt he was long the Nikkei at 39,000.

Nomercy: I haven't given any thought to the ramifications of another 60-70 $ decline in gold. Should it happen the only thing of interest to me will be which mine ( s ) have reached their break even point.

Silver and PGM's on the "MOVE" this morning...and the direction is still up....Somehow I believe that PGM's are in a Bull Mode!! Comments??
PANDA...how heavy are those Russky trucks?? Sounds like an effort to talk-down PGM'S, HUH??

...for gold to be driven down to $250 would require massive CB sales...though I don't know to whom...do you?...
..given your scenario...CB's would have to carry out their threat...and why stop at $250 when their "bookvalue" cost is only $35?
..which brings me to answer your question. No gold mine can produce gold at $35 ( must be calculated by some math flunkie ) ...so as it has been suggested gold producers around the world would shut down...right?...for the next 11 years or so...Is that your scenario?...
...so perhaps you can enlighten us as to the effect to gold producing economies...their markets...the inflow of capital...foreign exchange...and most of all PEOPLE CONFIDENCE!

Is Mr. Yen a good poker player?

PL V7
Oct. Platinum
3910
+25
+0.6
3915
3875
900
PA U7
Sept. Palladium
15350
+105
+0.7
15350
15150
276

Another jump in gold lease rates this morning.

...another indication of "reducing" inflation and CPI numbers....they'll do anything to avoid the massive increase, forthcoming to pay "babyboomers" unfunded pensions...
http://www.abc.net.au/news/nat/newsnat-15jul1997-87.htm

BillD -- I'm still pissed off at myself for missing the chance to pick up some Pt Koala's earlier in the year when platinum was at $350/oz and no one wanted the stuff..... Obviously there was 'tons' of it around then, right?

How much stuff are the Russian's providing? A little? A lot? No one seems to be saying any exact figures, but the spot market is saying something. The truth is, the Russian's are probably shipping some amount, but, is it enough? Or just a 'face' saving manouver for????

I'd like a raise too!

http://biz.yahoo.com/finance/97/07/14/y0021_z00_14.html

REB:

Yes, isn't it odd that the commodity which 'must' go down is somehow getting harder and harder to borrow. If the lease rates go up another 50 basis points gold will be backward in DM. While there is nothing earth shattering or magic about this it will mean that the refrain which is constantly heard about gold shorts making money off the contango will no longer be true for any shorts denominated in the core European currencies.

Nomercy: Way to go. You seem more exercised about a possible $60 drop than most did when I sugggested a $130 drop 9-10 months ago. What's your problem? I think mines close when they can no longer make a profit and without regard for the book value of gold stored by CBs. Several have closed so far and it has little to do with $35 gold stored in the Tower of London and a lot to do with the decline on the market to $320.
As for the ramifications I leave them to you. If I can stay on top of the mine closings and actually buy near the bottom I will be happy.

...and what has created the market to drop to $314? mine shutting?...I'm forever a student and learner and was interested in how you came to predict $250?...and what makes you believe that it'll stop there...

Financial Fairy-tale or Expedient Global Monetary Necessity: Global Gold Standard?! STARTLING IMF data demonstrate its feasibility. BOJs T-Bond holdings is keystone for success. EMU member participation essential.
http://www.gold-eagle.com/gold_digest/oracle714.html

July is nearly over so buckle your safety belt and prepare for August or a bit before when, my analysis suggests the next and most likely FINAL rally on the ever higher dow train commences. review my posted chart from sunday just past of the dow now versus the dow in 29 for % gain from low to high.
this next ( final ) leg up should see the dow carry to the 8700-9050 level perhaps even to 9200 by late september. from whatever level is reached we should witness the start of the most significant correction since 1990. tho the percent drop may not appear overly large the number of dow points will far exceed anything seen since 1987.

i think it will be at this juncture that we will witness a very worried ( tho they won't say they are ) FED add whatever liquidity is needed to try and prevent something truly unpleasant. their september meeting may prove irrelevant once the correction gets underway. they are now trapped into easy money if only to provide necessary liquidity much as in 87 only more so! i raise my glass to you at the FED and hope you succeed...the alternative should they not is deflation. this "window" will provide the precious metals best opportunity to rally into ( october-dec ) meaningfully in quite a while.

beginning late july into late september dow jones 8700-9050 or a bit more. the heralded autumn blowoff ain't never gonna happen. a correction of proportion is much more likely.

Nomercy: The trend in the price of gold for about 17-18 years is down.
The general consensus seemed to be that the average price of producing gold was about 275 10 months ago. A long term trend like the one gold is in may decline beyond a sustainable point so $250 seemed a reasonable estimate when gold was $380 or so. That's it.

With regard to your view that the CBs need to dump lots of gold on the market to further the decline --I don't think that is necessary although it would help. What is needed is a lack of buyers willing to pay today's price--a lack of interest from the potential buyers. We have that today.

Only "bugs" who think the bottom has been reached would buy today. Everybody else is siting and watching the decline unless they must buy for some reason that ignores the price. That's it.

Date: Tue, 08 Jul 1997 10:36:07 -0500
From: Geoff Miller
To: central-banks@lists.nyu.edu
Subject: The role of a central bank in a bubble economy



Announcing the availability of a study, "The Role of a Central Bank in a
Bubble Economy." This study looks at the role a central bank can play in
the face of rapidly rising prices in real estate or equity securities
markets, under conditions of low inflation and high employment. It
explores a variety of factors that may prevent the central bank from
intervening to stop rapid price increases in asset markets. It uses as a
case study the role of the Bank of Japan during the "bubble economy"
period of 1988-1990.

Persons interested in receiving a copy of this paper can write or email
the author:

Professor Geoffrey Miller
New York University Law School
40 Washington Square South
New York, New York 10012

email: millerg@turing.law.nyu.edu

COMRADE PANDA: Truk is 1942 Lend Lease Dodge ( ve gif bak soon )

Selby: You made the point that gold will go down because of a lack of buyers. I submit that this would be consistent with a low number of open contracts on the Comex. Yet I have the impression that the open number of gold contracts on comex is at a record high. Comment?

Selby -- My is off to you! You have managed to do what I have found difficult if not impossible, and that is to separate the emotion of gold from the market 'facts' of the day. Everyone wants stox, not gold. Although, I sense this is changing slightly. Perhaps it's the early birds nibbling. Again, congratulations, you were right and my index options have told me that I was very wrong.

I still believe the key to golds rise and the coincident stock damage will be the ForEx markets. As for the bottom in gold???? Let's see how far the stock mania goes. Clearly, we are beyond any rational standard when it comes to stock valuations. What was Dell a year ago? $20-$30 per share, and yesterday it closed at $138. A five to seven fold return in twelve months is 'normal'. :- ) ) At least, that's what some are banking on today. The Nasdaq Composite is up 50% from a year ago.

Don't misunderstand my comments, I'm not poking fun at you. I am sometimes too rational in some areas, with attendant weakness in others ( gold ) . Perhaps they are the flip side of the same coin?

SELBY.. You mentioned mine closings. I have heard of the threat of closings, but have seen no names. Can anyone list the mines which have already closed or is this just rumor. If I had a mine, I wouldn't close, I'd just store the gold.

Heard on the news yesterday that Russian wharfies have not been paid for months, like the Russian army. They are now being paid with TINS OF PINEAPPLE!! The wharfies are now bartering & trading WITH tins of pineapple. Talk about currency turmoil!! I wonder if George Soros is thinking about a bit hedge trade on pineapple?? Shades of Rees-Mogg & crew. The Russians claim they will be paid in rubles soon. If this escalates, I can see Russia helping Iraq/Iran out down the track. Yep, the deflation is well on it's way. I just can't work out why the Yanks can't see it coming on them like a steam train???

I wonder if George Soros is thinking about a big hedge trade on pineapple?? ( Correction from last post ) .
Aussie dollar down in sympathy with Gold & flow on from Asian currency
problems. All Ordinaries index down again for 3rd day running. Well into 2630 territory now.
Looking at the Asian currency turmoil, I wonder if Bonds will tank similar to the 1994 Mexican situation. I can remember very clearly how the bond market became super volatile for a while, with the stock markets climbing strongly just beforehand. Amazing how soon we forget. What worries me even more is how a 24 yr got on Kitco a while back, asking what the 1987 crash was like. I am getting old, & I am only 32!!

All:

Any of my fellow gold bugs notice that gold and silver just went pop!

Was talking by 'phone to a Senior management guy at Bounty Gold mine today out at Southern Cross, West Australia, re dropping Gold price. "Not a problem" he said "we have forward sold for the next 18 months". When I asked him what if gold dropped further & stayed down longer than 18 months, what would they do then? Strained silence. They hadn't thought about that one. Next subject.....
Me thinks it is a good time to do some detailed long term analysis on mine profitability across the board. Bounty is owned by Normandy/Poseidon.

I should write more obituaries, gold up a $1.40. O.K., if that's what it takes...

I was wrong, I will buy the DJ-30, SP-500, sell short gold, silver, and what ever else. I renounce commodities. Stocks for ever! Credit forever! Give paper!

There, if that doesn't do it, nothing will! :- ) )

REB: I think gold will go up when the man on the street joins the gold game. Today he isn't playing. It was the man on the street that got us to 850 aided of course by the usual cast of daily players as relected in the Comex figures. Today gold is as far away from the concern of the people who will eventually turn it around as rhodium.

Its like 4 PM in any farmers market on a Saturday afternoon. The price of apples is dropping by the minute because the product is there and the buyers aren't. Some noticable would-be buyers are hanging around to get the lowest price they think possible ( me ) and the rest are heading for their cars. The drop in price is not related to a new truckload of apples ( CB dumping ) its related to the lack of interest.

Despite the multitude of reasons for gold to rise that are offered daily here and elswhere I doubt there will be any turn around until some new interest appears on the scene. Until then the price will decline until it isn't profitable to produce. This is not earth shaking stuff I don't think. The average cost of production figure is impossible to know so $275 is an estimate. Buying about there would seem a better idea than $380 proved to be. There were lots of rational arguments presented for gold to rise from 380 but the 17 year trend won out. Lots of flak for the few who suggested shorting at 380 as I recall.

D.A. -- I noticed, but I couldn't think of the rock group that did the tune, "Losing my religion." It a while surfing the web.....

( Just kidding folks, goldbugitis is terminal! )

More evidence of record shorting of Gold.

Tuesday July 15 10:10 AM EDT
NY precious metals mixed early, heavy gold lending

NEW YORK, July 15 ( Reuter ) - COMEX and NYMEX precious metals futures were mixed in quiet trade early
Tuesday, with gold lending to hedge funds and producers continuing to fuel the downtrend, but the platinum group metals
( PGM ) physical market remained highly backwardated, despite reports the Russians were resuming sales into the spot
market.

``There's not much going on on the COMEX floor, but it looks like there's been some producer and fabricator offtake
which has provided some cushion, though its not giving gold a bounce yet,'' North American Equity Services floor trade,
John Geraghty said.

COMEX August gold was down $1.10 at $319.70 an ounce after the first hour of trade, with the August/September
spread narrowing to $3.20 an ounce from $3.40 Monday.

In the bullion market, spot gold was quoted $318.80/30, compared to the London Tuesday morning fix at $319.00 and
the New York close Monday around $319.70/10.

But the implied gold lease rate curve became inverted Tuesday, with one month rates, at 2.35 percent, now higher than 12
month rates at 2.16 percent.

``The lease rates just reflect the extent of borrowing by hedge funds and producers to fund short positions and forward
sales,'' one senior New York bullion banker said.

``The problem is the higher rates are attracting even more lending by central banks,'' he said.

Gold fixed at a 12 year low last week at $315.75 in London, after news of a sale of 167 tonnes of gold by the Reserve
Bank of Australia, which encouraged more short selling by hedge funds.

COMEX gold open interest, at 214,421 contracts Monday, is at its highest levels in 18 months, and net short positions
held by funds are at record levels, according to the CFTC Commitments of Traders data.

But OTC market positions are often two to three times greater than exchange-traded positions, and as a result speculative
short positions by hedge funds may have increased by about 500 tonnes in recent weeks, an amount equivalent to one
year's production by South African gold mines, analysts said.

COMEX September silver was up 0.5 cent at $4.280 an ounce, as the contract continues to consolidate above contract
lows seen last week at $417.50. The September/December spread was steady around 6.0 cents an ounce.

But the PGM market remained highly backwardated, despite reports of a resumption of Russiane exports, after a six
month suspension.

NYMEX October platinum was up $1.50 at $390.00 an ounce, but spot platinum in the physical market remained above
$400 an ounce, quoted $403.00/407.00, while one month platinum lease rates remained offered around 50 percent.

NYMEX September palladium was up $1.55 at $154.00, with spot palladium around $172.00/176.00, with one month
palladium lease rates around 80 pct.

Russia's metal export agency, Almaz, confirmed overnight it had resumed exports of PGMs to Japan last week, while Ralf
Drieselmann, the head trader at European catalytic converter maker, Degussa, said the Russians had begun offering
PGMs in the spot market also.

But U.S. refining sources said they had not seen any offers from Almaz in the U.S. market and in fact believed Almaz had
been on the bid on NYMEX September palladium early Tuesday, perhaps to cover short postions.

``The market for palladium especially remains tight, with sponge still at a premium to ingot,'' one refining source said.

Russia supplies about 60 percent of the world's palladium and about 20 percent of its platinum.

Japan views Chinese defense spending with concern:
http://www.yahoo.com/headlines/970715/news/stories/defense_1.html

Selby, you must be short Gold ?

MoreGold: Long cash.

Larryn: So far 1 large mine S.A. has announced its closing later this year ( didn't note the name ) and Royal Oak is also shutting one of its mines in Canada, directly citing the low price of Gold as the reason.
I will try to keep a list of closings as I see them announced.
Little doubt to me there will be more to come.

George S. Cole ( 07:45 ) -- I liked your historical analogy. The same thing happened to B. Napoleon when he snatched defeat from the jaws of victory on the battlefields of Borodino ( just W. of Moscow ) at the hands of Marshall Kutuzov and the harsh Russian winter.

Here is the question: do the gold bugs/bulls have an army to field? I was just thinking how to explain to my ( as yet unborn ) grandchildren my lack of participation in the bull market of the century, and how I was invested in gold and gold mining shares during the final years of the raging paper bull... Where do we get the weapons and ammunition to mount a credible attack against the infidels intent on debasing the noble metal? Or do we just sit back and prey for a "harsh winter" of unparalleled discontent? ( I think it is coming anyway. The signs are everywhere: Russia, Thailand, Korea, LA longshoremen to name a few. )

Please keep posting, I like the way you think.

Good morning everybody. Thought for the day-- "NOTHING is over until WE say it is."

Barrick Group rumoured to be taking over Australian Gold Mining company, Great Central Gold ( Joe Gutnick's outfit ) . Any Jews in Barrick?
http://www.smh.com.au/daily/content/970716/business/business5.html

...interesting 'how trend' periods are picked at random peak...and compared to cyclical lows...gold to my understanding is the neutral currency...and is the only currency...to have remained strong through history...more than I can say for any paper currency....Gold true value is not reflected as we do not have a "true market" since its being politically controlled...a great inordinate amount of propoganda and market conditioning is being spent to spread the doctrine that gold is a useless investment. Why?
...funds and traders create "panics" to advantage themselves...and discourage holders to sell and refrain buyers to to buy...they constantly barrage the negative...scare tactics....
CB's try and maintain stable economies avoid and post-pone the inevitable bubble burst...it happened before it'll happen again...the world population is growing and aging...western world finances are in a mess with massive debts...and unfunded pension liabilities...unemployment is increasing...former USSR is in a mess...statistics are being manipulated by politicians with short-term goals at the expense of the future...
...the CB's are the largest hoarders of gold...and with all their nonsense, still have the same inventory...they try to discourage gold buying as their 'pyramid paper scheme' requires constant cash inflows...
I don't believe that they would "risk" any major anomalies in the gold industry...its the funds that advantage themselves of political and currencies crisis...
...I would welcome a shakeout of sorts...as I believe that my gold investments would go up 10 folds if it happens...
...your $250 scenario would probably be the greatest thing for gold....Your initial call of 15-20% cyclical correction is normal in any commodity or currency...and thus your initial prediction was not unreasonable...
...I believe that we are at bottom or very close to it...and we'll rally from there...

Selby:

I don't think that looking for the average cost of production will lead you to the bottom for gold. At the moment, new mine supply, plus scrap is well below current consumption. The difference is being made up through CB sales. It is well known that CB's have more than enough ammo to fill the gap for many years to come. The question is will they. At current gold prices, and this is much different from 380, there will be little or no forward selling from mines because there are no real profits to be locked in except for the cheapest of producers. I have not attempted to quantify what this price drop has done to the supply demand situation but here are a few wild guesses. Going into the year, the deficit was estimated at something around 500 tons. Taking a wild quess and saying that supply will decline 5% and demand will rise 5% given the change in price and we add around another 300 tons to the deficit. This is twice as much gold as Australia has sold so it is a significant amount. The big change in the fundamentals may come from the mine hedging programs. If one made the wild guess that 30% of production over the next year was hedged, then the lack of new hedging would result in a decrease of new supply on the order of 1000 tons. Thus our 500 ton a year deficit may be ballooning into an 1800 ton a year deficit at these prices. This is the headwind that the specs and the CB's must fight. Unless you get some of the big CB holders to begin dumping ( US, Germany, France, Italy, Switzerland ) the rest of the gang is going to have to blow it all out to keep the party going.

The lease rates in gold are very telling at these prices. Normally one can not distinguish between spec borrowing to finance short sales and mine borrowing to do the same. The big difference between the two groups is that the specs can be forced into covering while the miners can not. They have the option of delivering newly mined gold to cover their shorts. At these prices it is pretty clear that we will get very little if any forward selling from the mines so the lease rates are due entirely to specs having to borrow metal to fund their shorts. I think that we are setting up for a big fast spike to the upside. With all the call options outstanding at higher prices the move could be breath-taking if it gets under way. Ah -- now I'm talking like a gold bug!!

Larryn: A Northern Miner article in last weeks edition listed the names of several SA mines that had closed and a few N American mines as well. I think I posted the URL here on the weekend. So far TVX has closed a mine in Quebec and several others have been mentioned as loosing money. It is a very difficult thing for the amatuer like me to figure out before hand so getting the information after the doors are closed seems the best I can expect.

D.A. -- I noticed, but I couldn't think of the rock group that did the tune, "Losing my religion." It a while surfing the web.....

( Just kidding folks, goldbugitis is terminal! )

I hate doing reposts from old data, ( the repost ) .

Kloof mines is reported to be closing one of their mines, possibly more if the price of gold continues its present direction....

Wary investors head for the door
http://www.australian.aust.com/cgi-bin/news2?story=b1

Did anyone notice that when silver and gold started heading North a bit ago that copper reversed and started heading South? Was there some news?

...did you play Repap or Tee-Com by any chance on the TSE?..because I think their mines got shot down!

Nomercy; D.A. Nomercy: I think we agree on the value of a 275 figure to the gold market but get there in different ways. During my adult lifetime gold has been the worst investment I am aware of and the "store of value" argument has without value during the same time. Perhaps because I was surrounded by people buying gold over 800 and even 1 pleading with his wife to buy the day it hit the 850 mark I'm not inclined to dismiss the peak as a simple aberation. Either way the trend can not not be dismissed over a 18 year period. My understanding is that unemployment is down in the industialized world -even in Canada. I understand that deficts are down in many countries in Europe and certainly here. So I see gold being out of favour because people in the industrialized countries are not interested in it and don't buy the gloom and doom scenario that is so popular here and elsewhere.

D.A. You might be right and I may be overly enthusiastic given a correct call 8 months ago. We should see soon.

...oops...re TSE...it was meant for you...overzealous to inform you of "shutdowns"

...its interesting that the market has absorbed close to 1000 tons of western CB's sales in the last year...and an enormous amount of current 'short hedge positions' and still only lost 20-25% value. It appears to me that there is enormous demand for gold at "bargain" prices....
...you keep on mentioning $850 and not $35 in 1971...
...if gold is your worst investment...what is your best?

DA In your analysis, you consider CB selling, producer supply, scrap and fabrication demand. What about that portion of the 70 to 75% of gold held in private hands that is held for investment. A considerable quantity of private holding must be in such investment hands, unless the 930 tons and more traded per day in the LBMA is attributed only to bullion banks and the jewelry trade. what significance do you attribute to this private investment, is it to be ignored as you imply? Also do you know who the participants are that normally trade the LBMA exchange?

Nomercy: I said gold was the worst investment not my worst investment. I thought Repap was a forestry stock.

DA Report out of London that "Resistance is being tested by producers trying to find physical metal to purchase" would seem to indicate that at least some producers are trying to find gold to cover their spot deferreds in the hope of higher prices. Or do you have another explanation?

EB....By buying certain numismatic items that have a small premium over gold and silver value, you may have more than one way to profit....1 ) Metals rise....and 2 ) Increase in numismatic value.....Now to do that you also take a lot of risks.A ) Dealer charges too much premium....B ) Dealer sells you crapola.....C ) Do you have a market to dispose of purchases when the time is right ???.....AND some more problems.....I will be happy to discuss advantages and disadvantages with you......JIN...Keep on posting and don't worry about your English....We get the idea and a view from the other side of the world can be most helpful to us all.....If you wish to e-mail your posts to have someone proof them before you publicly post them, I am sure we can arrange volunteers..... ALL...Happy trading....There will be a lot of money made and lost in these next market moves in the metals....May the trading gods be with you......

...gold is 'a paper currency risk protection' investment and should be measured accordingly...it has been such an investment for over 200 years as a currency...and withstood wars and all economic upheavels...
...paper hasn't...and thats why is so precious...unfortunately normal people haven't had the oppurtunity to purchase and to-day are still being discouraged...as its not a free market...thats why your $250 scenario is absurd..
...they can't free it and don't want to free it.....as their paper castle will fall...they try it to jawbone it down...but its to resilient...
..for my money if I've to accumulate wealth and pass it on from generation to generation...gold is the best investment to secure it against currency risks.....as it is transferable in any part of the world...cannot be reneged on like paper currency can...
...the two examples were just that...examples of opposites of your 'ill wishing' examples of your gold mine shutdowns which you're seeking this group...

Selby: Thanks for your comments earlier. My own thoughts are that gold will not exceed a trading range in the 300's unless there is a "paradigm shift" among average investors such as you describe. Gold could go into the 200's, but I think it's not likely. I do not believe that the CB community will divest all gold. The CB's want to retain the power to say what is "money", and in order to do this they need to be able to control the price of gold. If they were to sell all or most of their holdings, there would be a real possibility that gold could become a form of "black market" money that would be out of their control.

I think the increasing lease rates are very important. This says to me that it is becoming more expensive to lease the stuff so that it can be sold in order to keep the price down or to cover short postions. More physical or future positions would have to be dumped on the market to get into the 200's and the rising lease rate is telling me that that may not be the path of least resistance from here. I am guessing there is going to be a short covering rally that will get us back into the mid 300's. After that.......

Skylark:

I can not begin to guess what the net motivations for private hoarding are and what has happened to them as a result of the price decline we have had. Investment demand is a fickle thing, changing price affects trend followers one way and value players another. Small hoarders who hold metal as an insurance policy against political upheaval are unlikely to change their views based upon price unless the change is extreme in the up direction, to where dishoarding for gain would have a material effect upon their lives.

In price forcasting it is generally useful to pay attention to what is going on at the margin. The fact that the fundamentals of gold are radically different at 320 than at 380 should not be ignored. The longer we stay at these prices the more bullish things become. If we are going lower in meaningful way it will most likely occur sooner rather than later.

As an aside, I have been dangling a bet out there saying 360 before 300. I can't seem to get any action even though we are 40 dollars from my target vs 20 on the down side. I think that people recognize that each dollar down gets harder and harder. If someone wanted to bet even money 275 vs 365 I would be willing to wager a very large sum.

Nomercy: couldn't follow your last post but if you want to see the value of gold as currency protection you will find a major discusion of the topic here about February. The conclusion was that $850 worth of gold bought at the peak is now worth about $320 and $850 worth of DOW bought at the same time is now worth over $3000. So much for currency prtection during the last 18 years. Of course the 850 figure bothers some people so use 500 and make the calculations. Gold has dropped about $100 in the 15 months or so. The DOW is almost straight up. As long as the 18 year decline carries on there really is no argument about currency protection.

That is it for today.

Selby : Here is an oppurtunity for you to win some serious money off D.A. Go Selby, show us the strength of your convictions.

DA Thanks. I believe that gold held by Private Investment is the margin and this will dictate price, not CB selling. CB selling was greater during the 93 rise than in any of the prior years when gold was going down. No amount of CB selling will stop a rise in gold if financial conditions warrant a higher price. I could not accept your bet as I have no idea which way this market will turn, but risk would seemingly favor the upside with short-covering demand and a market consensus of lower price.

Been away but glad I'm back. Some good discussion today ( D.A., Selby, GSCole, others ) .

Anyways, to lighten the mood here are some of the winners from the "worst analogies ever written in a high school essay" contest:

They lived in a typical suburban neighborhood with picket fences that resembled Nancy Kerrigan's teeth ( Paul Kocak, Syracuse, N.Y. )

He spoke with the wisdom that can only come from experience, like a guy who went blind because he looked at a solar eclipse without one of those boxes with a pinhole in it and now goes around the country speaking at high schools about the dangers of looking at a solar eclipse without one of those boxes with a pinhole in it. ( Joseph Romm, Washington )

She caught your eye like one of those pointy hook latches that used to dangle from screen doors and would fly up whenever you banged the door open again. ( Rich Murphy, Fairfax Station )

The little boat gently drifted across the pond exactly the way a bowling ball wouldn't. ( Russell Beland, Springfield )

McBride fell 12 stories, hitting the pavement like a Hefty Bag filled with vegetable soup. ( Paul Sabourin, Silver Spring )

From the attic came an unearthly howl. The whole scene had an eerie, surreal quality, like when you're on vacation in another city and "Jeopardy" comes on at 7 p.m. instead of 7:30. ( Roy Ashley, Washington )

Her hair glistened in the rain like nose hair after a sneeze. ( Chuck Smith, Woodbridge )

Her eyes were like two brown circles with big black dots in the center. ( Russell Beland, Springfield )

Bob was as perplexed as a hacker who means to access T:flw.quid55328.com\aaakk/ch@ung but gets h:\flw.quidaaakk/ch@ung by mistake ( Ken Krattenmaker, Landover Hills )

He was as tall as a six-foot-three-inch tree. ( Jack Bross, Chevy Chase )

The hailstones leaped from the pavement, just like maggots when you fry them in hot grease. ( Gary F. Hevel, Silver Spring )

Her date was pleasant enough, but she knew that if her life was a movie, this guy would be buried in the credits as something like "Second Tall Man." ( Russell Beland, Springfield )

Long separated by cruel fate, the star-crossed lovers raced across the grassy field toward each other like two freight trains, one having left Cleveland at 6:36 p.m. traveling at 55 mph, the other from Topeka at 4:19 p.m. at a speed of 35 mph. ( Jennifer Hart, Arlington )

The politician was gone but unnoticed, like the period after the Dr. on a Dr Pepper can. ( Wayne Goode, Madison, Ala. )

John and Mary had never met. They were like two hummingbirds who had also never met. ( Russell Beland, Springfield )

The thunder was ominous-sounding, much like the sound of a thin sheet of metal being shaken backstage during the storm scene in a play. ( Barbara
Fetherolf, Alexandria )

His thoughts tumbled in his head, making and breaking alliances like underpants in a dryer without Cling Free ( Chuck Smith, Woodbridge )

The red brick wall was the color of a brick-red Crayola crayon.

Of Japan's $220 billion in foreign-currency reserves, 76% is now in US dollars. Nippon legislator says Japans gold reserves far too low. Dines ALL-GOLD REPORT has interesting insights:
http://www.gold-eagle.com/editorials/dines712.html

... the US $ hasn't passed the test of time...like no other power currency has in the past....gold has...you've been around this site too long for to rehash what you've been reading and learning at this site...
...you're prediction of $250, and how you arrived at same, was of interest to me...and you admitted in earlier posting that you picked a number out of the hat...and perhaps thats a good way for you to decide your investments...if it works don't touch it!
...you also said you were long cash, so you must have missed not only cashing in the fall of gold ( did you? ) or missed on the ascend of the Dow ( you must invest in indexes? ) ...or perhaps you cashed in on both positions...which its a great feat indeed..and you need to be congratulated for...
...you've achieved what few have been able to do perhaps, that is to suck and blow at the same time...
...now you are predicting $250 and are long cash. Interesting.

Korondy; I am sure that george Cole could answer your question but I think a simple answer is that gold investors need what the Italian people refer to as "buona fortuna". This gold market needs a big event to turnaround. Lazarus will need to rise from the dead to get all the technical and fundamental indicators pointing the same way.

Westly: The reason the dow has been going up in the face of a slowing influx of cash into mutual funds is *redeployment*. That is, all the fund managers are focusing more and more on the S&P 100 stocks. Because of the popularity of index funds these stocks have been outperforming the market as a whole for some time. The other funds are also focusing on these stocks in order to compete so they are redeploying assets into this focused group.

In the 60's there emerged a select group of stocks called the nifty fifty which kept going up for the same reasons.

The dow or the s&p 100 is not the market and there has been quite a divergence between *average* stocks and this elite.

Roebear - Found your 03:02 a bit confusing. What is this talk of integrity and how is that germane? Do you question my integrity to print exactly what I think,. or do you find duplicity? Comparisons to hep-cat are strained at best. Would it make you feel better to know that I back up my words here with hundreds of thousand of dollars every day? I trade this market and to risk repeating again, I dont care where it goes, up or down, its all the same to me. There are others here who will constantly call today a bottom and predict the price will turn around soon, they continue to spew feel good platitudes about golds imminent recovery, in the face of a quite different reality. Any one following their advise would be sorry today. I offer no advise here, just my thoughts and views of this market. I have been making some spectacularly winning trades over the last few months. True, I am holing some silver and platinum at higher prices, but I havent given up on them. I wonder what you find here to question my integrity? There are some here with who I am in touch with outside this group. They know who I am. Who are You?

Just a random thought on Oracles latest missive ( http://www.gold-eagle.com/gold_digest/oracle714.html ) . If the CB's were actively interested in persuing a more active role for gold in the world currencies they would likely camoflage their moves by a lot of negative press and possible market intervention. If this would help them screw their natural enemies the hedge funds in the process all the better.

I don't know what odds to put on this scenario ( more likely lower than higher ) but it is something that is compatible with what is now happening.

On a separate note, it is hard not to be unerved by those massive volumes on the LBMA. It is like reading that gold has spiked on large volumes in the martian exchanges and wondering what, if any, impact that development will have on the local exchanges... High weirdness.

Nomercy: Couldn't follow your last post either. Since you can't understand mine I think we are even.

RJ: Do you have any thoughts, insights to share about the LBMA, the players, it's significance? Any insights on this enigma would be appreciated.

My, this heat has tempers flaring.

GFD: I enjoyed your recent post and its implication. Now only if everyone would cooperate we may see Lazarus walk again.

Now that Japan is spoken in a more official tone that it is not interested in buying gold, and since this Asian "hope" is now gone from the Dines and Oracle reasons for gold to rise, what then is left as there is no significant inflation with the CBR off in price, there are no global wars, the dollar is strong, the stock market is robust, and bond yields steady. What reason is there then for shorts to cover and gold to rise. And if there is no reason, why should gold rise. Dine's last hope is that mines will close, but that means lower prices and a long dreary summer or more.

SKYLARK: I do not think that the dollar is "Strong". Rather, it is weak on its fundamentals. The reason for its apparent strength is "demand" by overextended debtors who need it to pay dollar denominated debts.

MIKE SHELLER........Gold to a little over $100.00 has been Prechter's prediction for some time.....Based on E-wave theory...If you haven't read his book "At the Crest" you ought to.....It really is fun reading.....While I was reading it I said a thousand times "I wish this book had been around and I had read it in 1980". Of course he also predicted the top for stocks several years ago.

To Chartists: Quite a discovery by Crystal Ball of the following site for charts. It includes you choice of indicators, timespan, fundamental data, etc. Really useful and I am still learning its potentials. the URL is listed on Barts Web Resources Links above but I will list it here again.
It's http://www.bigcharts.com/nscp/3.x/

2%+ and growing monthly lease rate = $6.40 a month
got to cover some time

RJ! RJ! Why can't YOU be my broker? ( Life's a bitch and then you die! ) Sigh...

What Hope Is There?
The preponderance of media HYPE describes Inflation as nonexistent and therefore that Gold has no value.
It seems to me that Gold has more than one leg. With currency devaluations from the recent past ( Mexico ) , now South East Asia, followed by Brazil, Golds strongest leg, that of monetary
stability should manifest itself.

D.A.@12:29 - Try R.J!

I am a little confused with the recent Bear Bashing Banter. Is this page the exclusive site for gold bulls only? Knowing ( or hoping to know ) when to go long a market and relying on that approach is like a baseball pitcher who can throw just one kind of pitch: You can win if you're really good, but even then, success in the long run is an outside chance at best.

My ( 03:26 ) should read Market Caps 100 times Sales. Speed ( 06:38 ) , that to, but with living prices the same and earnings at 1/4, its like inflation for them.______Just trying to hassle RJ.

who says gold will not rally when the paper-tiger
takes a powder? when this bull first ran into
resistance what did gold do? this was the day
there was a 180pt+ downdraft, before recovering
to continue its' current run up the mountain.

when the emotive forces ( panic ) kick into gear,
gold will soar like the initimable eagle on high.
there is no need for a consensus of opinion that
gold is a store of value. there is a psycho-somatic
connection, that is dominated by emotions. the emotive
forces of mob mentality will be un-controllable and as the
waves on a beach-----some regualrity, interspersed with plenty
of chaotic sworls and eddies. chaos and flux will rule, and there
will be plenty who rue that day.

steve-@perth---

thanks and keep it up!

the heat wave that has begun to engulf the mid-section of the
country has been expected and predicted. what is next? the
grain-train has blasted-off again. are you on-board? alice
is waiting for its' arrival. it's time to party--------


cherokee!; ) reaper-of-a-bitter-harvest

Skylark: I think the turnaround in gold will happen when the gold producers decide to counter-attack the shorts and spike the gold price north into a higher trading range - possibly back to $340- $350.

You see, things are really simple. The price of gold is a function of real fundamental + speculative demand and supply. Mr. Gold Market is controlled by the speculative shorts who are confident that CBs will back their profits with episodic gold sale dumps in the physical market that can be exploited for news content irrespective of absorption and price activity: psychology and the 'big scare' rules here.

Peter Munk is the CEO of ABX. He owns a nice chunk of ABX amoung other real assets. He is very rich. He also earns a multi-million dollar package each year as ABX CEO - come hell or high water.

Hell or High water is approaching. Peter, and other notable gold miners, will come to realize the folly of his mistakes.

Peter figures that the short-sighted greedy approach will prevail in the long-run. He figures ABX has big profits locked in by a 7.5 m.oz. hedge program until 2000+ and that he can ride out short-term the swings in gold price by looking for and picking up cheap gold properties.

Now this strategy at first blush looks mighty good. One big problem however. The fundamental trading range in gold is being decimated and it will take more and more financial will and determination to turn this Mother Bear around. The longer Peter and his colleasgues sit on the side-lines while the gold team is losing the more the score will drop to lower the playing range. The Team Gold cost to lift the market back will be that much more expensive and time-consuming irrespective of few short rallys.

Peter, as you may know, has expressed benign neglect and is not really bothered by flies like me since he is very rich and he probably is well-diversified in oil and real estate even if gold is destroyed. Peter is in his sixties. Why bother about the long-term when you have enough cashish and investments to live a bountiful remainder of your years and still leave a fortune to the kids ?

So who is the loser ? Long-term gold investors and shareholders ( "we" ) . Who wins ? Gold managment. How do they do it ? They steal shareholder wealth through strategies that protect their territorial imperatives ( poison pills ) and self-deal in bountiful corporate options issued at fire-sale strike prices at times like these ( I don't suggest Munk is taking additional options at low strikes but other gold managers have tried in this market. )

The best part about being a Gold Executive is that you get to increase management option benefit plans during bad times when the stock prices stink....like now.

Again, when do we get some relif ? When Peter Munk and his gold miner friends decide to blow-away the shorts to protect long-term industry interests instead of short-term private greed.

How do they do this ? Buy a few billion worth of long gold contracts to drive the shorts to cover and recover and recover to cycle their losses back into the paper price of gold as it spikes up to higher trading ranges.

Is there any of you out there who think that the shorts could not be defeated with an additional couple Billion worth of strategically bought long gold contracts rumoured from the Gold Industry ?

The Gold cartel could move the price of gold higher just as the shorts and their CB friends have knocked it down. The CBs would need to back-off as the politics would favour Gold Miners who employ and deploy real economic resources over the dead bodies of paper speculators who have no similar use or benefit to real economy - particularly in lesser developed mineral rich countries.

Cheers.

Cherokee; We long investors will hope that gold rallys in the demise of the paper stk Bull but I won't be surprised that it only amounts to a short rally until the paper Bull once again rises - just like the good old days. Do you doubt that stocks have done better than most assets over the long-term ?

D.A. : the great thing about golf is that you play against yourself everytime
out. It is the most honest game in the world, it is alot like gold.
I carry a low teens handicap in the summer and a high single digit in
the winter. I would most welcome any invitation to join any fellow
Kitconites on the links. I always post my email, anyone feel free
to drop me line if you are in town.

Panda: your post about "big gun" I found assuming. Without knowing it,
I think, you chose the handle of one of the world's top Satelite hacker
to describe the Japanese spokeman. Could the Japanese be fighting the
establishment?, just like "big gun"?

geff: Re: Bear Bashing. I doubt that anyone goes looking for a place on the web where the main topic is the decline in gold's price. Most people get here I think because they are searching for information about when and where it is going--Up and soon --being the preferred message. So you have many who post here who think the gold price is totally controlled by CB's and that the battle is with them. Others are looking for confirmation of things their fathers told them or they learned in school--gold is a good store of value or there is going to be a major depression and gold is good to have then. Or that there is a civil breakdown over the horizon and gold should be stored away for it. Recently its been difficult to make money expecting it to go up. Some go away or become more adamant that gold is going up. If someone then says its going down first ---bashing is to expected. Usually the discussion is Ok until somebody finds their guiding priciple challenged and then they resort to name calling. Can't deal with the argument so they call the other side a couple of names and that's that. The value of engaging in the process is to see if your position can be successfully challenged. All you have to do is remember when they start avoiding your argument and call you names you have won the argument. What you win is another issue. This sort of thing is not restricted to Kitco. Extreme reactions on sites devoted to spefic gold mines are common place and people have been banned because they questioned the view of the believers.

BOB: Thanks for the comments, but the big boys are in the cat-bird seat with ABX and NEM having cash costs below 200 and PDG approaching that, they can wait to pick up the best of the high producers or Juniors and may have little incentive at this time to move gold higher. Also CEO's like to build their empire and now is an opportune time to do that.

The chief puzzle I have, and have not found any satisfactory answer, is who are the parties dealing in the LBMA Market. At 930 tons a day ( and up to 3 times that amount according to the report ) this is about twice the total of the estimated shorts outstanding. Therefore, it would not seem that difficult for those trading the London market to move the gold market higher, if that was an objective. The LBMA seems to be a market within a market, I am continuously puzzled as to why more attention is not directed to it by analysts and the media.

Ve Russians; vunce ve haf more gold dan US, you look us now.
Ven da Goverment pay us money ve buy gold.
Mafia have dollar, dey buy gold vit and caviar tins vit rest. Dey sell caviar for more dollar and buy gold vit.
Ve pissed off, vant Czar back; government pay us no money.

A broker report stated "with short term lending rates higher than longer term rates, further CB selling is likely" Would anyone care to explain this. I believe the statment means more than just additional speculation at the shorter end.

Selby - This site benefits greatly from your unbiased contributions.
Glad to see the discussion directed towards your points today.

Everybody - My name is John. Not that I care, since you are obviously
using my E-mail address as a disparaging term, but I think I should be
accorded the same respect as everyone else on this site, especially
since I post a real E-mail address and since I was a lot more correct
in my prediction than people who get deferred to as a matter of course
on this site. I guess I could start making fun of Aurophile ( his chosen
handle ) by calling him "IBMer" or making fun of Mooney ( his chosen
handle ) by calling him "Iderector" or something. It just shows who the
true childish people are on this site when you continue to refer to others
by their E-mail account. I would advise you to go over to the Gold Forum
on SI, read drytoast, and see what it will take to turn the gold price around. I hope you continue to scoff at what seem like ridiculous ( and ridiculously simple )
demands. Remember, it's only your money to lose. Maybe you don't
really want the gold price to turn around. Maybe this is as much a game to
you as it is to Cheri Que and RJ2/Paskapoo/Leaner.

... your $250.... I'm willing to say give you 10 to 1 odds...you decide the amount...and I'm close by so we can do this face to face

Remember, my posts on KRY from about 2 weeks ago. To those who have and/or will be enjoying the ride, congrats! If you ignored my posts and were too busy listening BT, oh well ... life goes on.

See http://www.vheadline.com.ve for more details.

Selby, I'll be the witness since we're all in T.O. area, and besides we'll all get to have an afternoon of camraderie. I propose that the three of us go to a local bank, the bet is deposited into a joint account ( you two ) that no one can withdraw from without both signatures.
nomercy - Five to One is more than fair. ( Sorry Selby but referee's have to be fair ) .

Nomercy: My bet is down and public. Has been for months. D.A. is the betting man around here try him.

SELBY: RE yours at 15:59: I am involved in gold because I expect that it will retain more purchasing power than the dollar from this point. If gold goes to $100 and houses go to $5000 who is going to complain? In that event you get a tax loss for your gold to boot! ( unless they change the rules ) I think the situation I just described would satisfy both the bulls and the bears, and I think it is a real possibility. The Dow/Gold ratio ended the day at 25.01. The July 8th high still holds.

...thanks for your offer and I'm game...we have to decide the amount and the time line...my 10 to 1 stands...and say his $1k to my $10k and winner collect by Dec. 31/'97

itsy bitsy trader: Congratulation, hope that Crystallex continues onward.

Jack ... congrats too? if my memory serves me correct. Maybe I'll buy some Maple Leafs with the profits ( after taxes and tithe ) if all goes as I think.

: )

geff: I hope your watching this. Here we have the mano a mano approach to finacial discussion complete with the site jester who has atleast temporarily put down his book of quotations.

Selby : Take up D.A.'s wager. Make some money and prove your point.

Toronto must be a better fight town than Vagas. Watch your ears at all times.

Skylark:

I'm not sure if you got the quote right because it makes no sense. High lease rates only encourage lending unless they are high enough to put the commodity in backwardation, where natural holders of inventory sell now and buy back later at a profit. I do not know how the CB's approach leasing, but assume that they have some fixed amount which they are allowed to loan under some set of rules either from their respective governments or themselves. Perhaps higher lease rates will encourage them to make more gold available for loan but I fail to see how it can encourage them to sell outright since all they will get is the spot market cash rate irrespective of lease rates. It is in the realm of possibility that their lending limits have been reached. If their supply for lending purposes was infinite then lease rates would be capped by some arbitrary price at which they would always happily loan their metal. Since we have historically seen spikes in rates one must assume that there is some limit to the amount of material available for loan. The rising lease rates that we are now seeing are probably indicitive of gigantic short speculative positions. These folks must borrow the physical metal to sell short into the market so there is a great demand for physical stuff to keep the game alive. To me the big intrigue is who are the ones on the other side of the trade.

With regards to the volumes of the LBMA it is unknown how much of this clearing is position squaring within the membership and how much is pure customer flow. Assuming it is all customer flow I'll try to make some guess as to the amount of speculative money needed to generate this kind of flow. In our currency fund we generate approximately the dollar value of our fund in trading everyday. Since our fund is set up to monitor lots of different cross rates we are more active than if were only trading a smaller number of currencies. However, our round turns per million ( number of IMM equivalent contract traded per year per 1000000 under management ) is considerably less than average in the industry. We trade in 8 currencies including the dollar. Guessing that we are about half as active as the average fund, if we used gold as a currency, then the average fund might turn over 25% of its holdings every day ( 8 / 2 ) . The LBMA numbers would then imply about 40 billion dollars of speculative money actively trading the gold market. Or to put it in more current terms, 1 Gates.


An average commodity fund does something like 2000 round turns per year for each 1000000 under management. This would run about

In any event if you think of gold as a currency of sorts the volumes would be pretty insignificant compared to the flows in the other currencies. For example, we are pretty longterm traders with a return target of around 25% per year and still our currency leverage can get 10 to 1 in terms of the dollar value of the currencies that we are long and short at any moment. If we included gold in our system as another currency, we could easily have a single long or short position in gold equal to more than twice our assets under management. If we were high frequency traders as many others are,

Skylark:

Talking about making no sense. Ignore the last 2 paragraphs of the last post. They were supposed to have gone to editing heaven but snuck back in.

You are showing a bit of frustration in your recent post. Nobody uses name calling here unless seriously provoked. If I may say so, you have a tendency to resort to sarcasm to win your point and this attitude won't make you popular in many discussion groups. For instance, you are scornful of people who hold the opinion that Cbs are involved in gold market manipulation because you believe that only unfettered market forces are responsible for the direction of the price of gold. Yet, you cannot produce any evidence of your theory anymore than the others can, but you feel entitled to pass judgement on them.
In other instances your attitude is different and I enjoy your pragmatic view of the world.
I, for one, am not a gold bug but visit this site regularly because there is much to be learned here
including the reference to very useful resources ( some of them produced by you ) .
Gold has also made little money for me over the years and is only 2% of my portfolio at the present time.
Now I am going to retreat to my bomb shelter awaiting your reply.

...I issued the challenge which is still on the table...for you to put up or shut up...your $250 prediction is unbased and nonsensical...and I wanted and want to prove a point...
...there are quite a few intelligent analysts in this site which I think, we all enjoy and learn from...and provide a sound, logical approach to their conclusion...and we're all the wiser because of it...Kitco provides a better forum than a University course...
...some garbage needs to be filtered out from time time...and allow these experts to continue and enlighten us...in a serene mode...

Este: Thanks I'll try to hold my sarcasim in check in the future. I think I have said all I know today anyway so maybe I'll get better with time and in silence.

SA mines cutting costs, These will far outperform the North Americans when the next gold bull begins



By Melanie Cheary JOHANNESBURG, July 14 ( Reuter ) - South Africa's gold mining
industry and the National Union of Mineworkers on Monday unveiled a
productivity-linked wage deal which could save thousands of jobs threatened by a
meltdown in the gold price.

The framework deal is the first of its kind, offering miners substantial wage increases in
exchange for a quantum leap in productivity designed to lift national gold output by
nearly 20 percent.

The deal offers a two-year package of annual wage increases of between nine and 25
percent, providing agreement is reached at individual mine and company level to
increase 1997 gold production by 90 tonnes from the 495 tonnes produced last year.

"An accord of this nature is likely to protect employment rather than jeopardise it. But
we can't give employment guarantees," said Adrian Du Plessis, industrial relations
adviser to the Chamber of Mines employer body.

The South African gold industry has long called for improvements in productivity to
offset rising costs at its deep, labour-intensive mines which have hampered its ability to
compete with cheaper open-cast operations elsewhere in the world.

" ( The weak gold price ) has added a great urgency and imperative to reaching a robust
wage and productivity agreement.

This is an accord which links wages, production and productivity," said Chamber
president Nick Segal.

Segal said employers believed there was great scope to increase productivity in the
industry.

Thousands of miners, in an already pressed industry with declining production, are
threatened with job cuts after the recent slide in the bullion price to 12-year lows.

Gold mine jobs have already been cut back from around 530,000 in 1987 to around
350,000 in 1996.

"This accord allows us to save jobs and lay a foundation for substantial growth in the
industry. ( This accord ) lays down the first lesson for us in how to deal with major
setbacks in the industry without panicking, without alarm at possible job losses," said
the NUM's general secretary Kgalema Motlanthe.

The deal is subject to negotiation and approval at mine and company level between
management and union representatives. The aim is to commence these mine level talks
immediately and the Chamber said agreement could be reached within weeks.

A two-year agreement will hopefully eliminate the annual wage struggle that has long
been a feature of the industry and has often led to disputes and strikes, the Chamber
added.

"The settlement seeks to take the wage conflict out of the mining industry and lays a
platform for a better partnership ( between workers and management ) ," Du Plessis
said.

The proposed 90-tonne output increase was calculated by accumulating individual
producers' target output increases.

"Agreement on this production will trigger the implementation of the wage increases.
These are significant wage increases tied to substantial productivity improvement and
reflects the joint commitment of both parties," Du Plessis said.

The Chamber said it was negotiating the same deal with other smaller unions and these
talks were at an advanced stage.

The wage increases will be backdated to July 1.

10:18 07-14-97

Nomercy: On the table is where it will stay. I believe I presentd a working successful perspective on the gold that seems to do the trick for me and I summarized it at your request. For this I receive "absurd nonsensical and pulled form a hat." Not really the sort of thing serene discussion is made from. Anyway good luck with your investing approach.

This market the past few months reminds me greatly of a man who walked into a bar greatly aromic and when he entered everyone except the bartender vacated holding their nose. The bartender walked over to the man ( since he is on duty and couldn't leave with the other patrons and obviously had no one else to talk to ) and asked his name and asked what he did for a living that rendered him so fragrant. The stinky customer stated that he worked at the circus and walked behind the elephant catching its droppings from time to time. He admitted that occasionally the elephant droppings were difficult to catch and sometimes sparayed on him. The bartender scratched his chin perplexed by this man and why he would work at this type of job. Finally he asked the unfortunate customer why he didn't give up the job and work at something not quite so disgusting. The customer sat up straight and in an incensed voice answered "And give up show business?"

KORODNY:

Where will the armies come from that will ultimately crush the gold shorts? I cannot give you their names ( although several possibilities do come to mind -- George Soros, The Bank of China, private Asian investors, the Bank of Japan, and the gold mining industry to name a few )

But the thrust of my argument is that the extraordinary short position in gold extant today AT VERY DEPRESSED PRICE LEVELS creates a truly staggering profit opportunity for any group with sufficient resources to blast the shorts out of the water. And if gold drops further in the face of additional big increases in the short position, the profit potential becomes even greater.

The magic of the marketplace will be quite sufficient to massacre the shorts. When and at what gold price I cannot say. But this massacre is coming as sure as the sun will rise tomorrow.

http://biz.yahoo.com/finance/97/07/15/z0000_z00_16.html

Well ain't this unusual, a food fight at Kitco again. Well at least this time everyone seems to be keeping their own handles! OK, enough of this sitting on the sidelines. If we're drawing the line in the sand, I'm with Selby. I don't think the central banks are the reason it's going down entirely. On a percentage basis, I'd say it's 75 to 25 in favour of the speculators. Sure the banks gain by keeping their king diguised but the speculators gain in a bigger fashion. We've been through it all before as to why. I've nothing to add except that I'm a firm believer in the theory of supply and demand. The problem is that the banks have made the "weapon" of supply too available to the henchmen "shorts" who will use the banks "weapon" to win the war. They will win, no doubt about it. It will change only when they grow tired of not making as much money as before, then they will change direction and we will all be standing around in bewilderment as they make money on a shortage they created. Personally, I wouldn't have believed it either except that when I was in business, I remember that Mr. Mulroney raised the manufacturers tax so many times as to become onerous and then went yelling from the rooftops that we had to have a GST tax to replace the "BAD" manufactures tax. That's the hidden motive theory of bigger forces. The banks have a hidden reason and that's to give their "debts" worthyness and keep a failed system going and the shorts are more than willing to help as long as they make a profit. It won't end until there are no more buyers for the sales of this gold. It's that simple. Supply and demand. So I guess that puts me in Selbys corner on this one. Do you really think that the Japan / USA / Australia gold intrigue was not planned behind closed doors to control the situation and debt worthyness through timely disinformation? It was one of the most slickest "operations" that's been put upon Gold in a while. BRAVO to MR. RUBEN! Nice move! Talk about control! Half of Kitco sees it as you, the other half says not! Now that's power! But the real power is in the hands of the speculators, not the banks. If the specs want it to go the other way, it will. As George Cole says, if it gets going even the banks won't be able to stop it! Selby, nice call !

TTFN

Japan Ex-Im Bank and IMF to cooperate on remedy for Asian Currency crisis.

http://www.nikkei.co.jp/enews/TNKS/page/asiaset.html

Correct me if wrong._______I believe you feel that government and those who control them from behind the scenes; hold the upper hand and essentially can do what ever they want with the people and the markets? Most politicians say in power a reasonably long period, so some feel, it's best one wait for signs -like a real sustainable direction- to place ones bets. I think you are aware of the manipulat_ions ( ors ) and have decided to remain aloof from them?
I believe that there are many signs that point to higher prices for gold and silver. Just the supply and demand; heck with central bank sales or loans.
If a government would rather hold the paper of foreign powers in reserves; in place of gold with utter disregard for their people its smells like TREASON to me.
They hang spies who compromise the military security of a nation, how about the economic security?
That may sound hard, but what happens to the yen; if for some reason the dollar crashes. Such things have happened since the begining of governments. One can argue that such takes place over a long period of time, but we have a posterity to consider.
Last are mining costs.
Did you know that a department store with no expertise in producing what they sell and utilizing low paid workers take a 100+% markup, sure they have rent etc.,etc.
Most good miners after they add in front office, P&I, enviromental and other cost like depreciation and depletion, that sometimes they might not add into reported labor mining cost come up with prices in the range of $300+. Then there is always the danger or uncertainty element.
Considering demand and a fair profit for the gold mined
$600 gold is not out of hand; and the hell with those who think otherwise.

DA Thanks for responding, you are right, it must be a bad read.

As to the LBMA, thank you for that explanation. One reason given for a CB to sell gold and buy a basket of currencies is that if it needs additional funds to support its currency, it is easier to sell another currency than gold without affecting the market. Yet, the LBMA states that the reason for the announcement of the volume traded in gold is to show how liquid the market is. And at 930 tons a day, such amounts as sold by Australia could seem easily absorbed without significantly affecting the market. I have read that the LBMA figures may be suspect, but I have not seen any rationale of the trading to my satisfaction. And if the market is so liquid, why do specs believe such CB selling will continue to reduce price unless a very large quantity of gold is expected to be sold? And at your figures, buyer's of gold trading on the LBMA could easily wipe out the specs in a day. And sophisticated funds should have a handle on this.

As to who is buying. I often consider this as once gold is sold, it cannot be resold by a seller. But if one analyzes the gold sales, there has not been that much gold reportedly sold by CB's on a net basis, and fabrication demand was exceptionally high during the first quarter. Perhaps this fabrication demand was adequate to absorb most of such sales. But it would appear that additional demand from private investors or unreported CB's would be necessary to have absorbed all of the short selling that has been and is still going on. But if so, where does that get us, as price continues to decline.

Finally, I have noted that during the decline in bullion the back months were usually just as weak as the front months but at least earlier in the day, the back months months were firmer, with a widening of the August/September spread. Whether this has any signficance remains to be seen. I have not checked the close.

RJ In response to your 13:42. My post was designed to prod you a bit to see if the RJ handle was always RJ, in this perhaps I did too well. I will apologize for my excess zeal, although you have admitted to doing some proding of your own here in the past. Your response spoke volumes.
"Talent in and of itself is nothing without integrity" referred only directly to the identity of the RJ poster/imposter. That is, if there were another. Frankly, sometimes it seems there are two RJ's, one poetic, litereary and even handed, another a bit nasty at times.
Who am I? Well, I do not trade 100K's of others money. I am a small investor learning here and other places on the web. My accolades? Seven years in my own business from the age of 20 ( didn't go broke/didn't get rich ) . Never stole a penny off anyone. Then work for others, I currently work for a fortune 500 company.
When doing security work I helped police capture an axe murderer once, I staked him out and found him and blocked his escape. Didn't know he was an axe murderer at the time. Some other actually worse scrapes also. I have given a lot of first aid to people and resuscitated one woman with CPR ( very rare to actually have a resuscitation w/o paddles ) . No one ever thanked me and that doesn't bother me. Besides a great wife and kids, that's my claim to fame. So is that enough info? So we square or what?

I've got a good wager. It can be friendly and fun w/ NO macho-he-man-stuff. I plan to build a relatively large spread ( option ) position in either GCV7 or GCZ7. It will cost no more than an ounce of gold- $320 US ( commissions and all at $50.00 r/t ) . I plan to short the market and ( D.A. ) or anyone else can go long. At expiry we can see who has the $$ and who is, in fact, IMPECUNIOUS.

This is all in fun and no one gets hurt...you understand?

COME ON! Let's have some FUUUUUUUNNNNNN!

AwAy eB

are ya' feelin' lucky punk... well are ya'?

Panda- REM did "Losing My Religion"

PBS, Nightly Business Report, just reported rumor of a Brazilian currency devaluation.

...according to Steven Kaplan, one month lease rates up to 2.35% while th implied one year rate is 2.16%...
its getting to be expensive to borrow and keep it pushing it further down....as the plot thickens...the stakes are raised...turmoil and devaluations in currencies....another "magic" number to be tested by the Dow...which will take a few cracks to surpass and maintain...Greenspan to testify on July 23....

MARKETS TUMBLE IN BRAZIL:
Prices on Rio de Janeiro Stock Exchange fall 8.57%

RIO DE JANEIRO, 07/15/97 - For the third consecutive trading session, the national stock
markets have registered losses. The Rio de Janeiro Stock Exchange ( BVRJ ) fell by 3.5% yesterday
and the National Trading System ( SENN ) dropped 4.3%. The BVRJ's blue-chip shares plummeted,
resulting in an accumulated loss on the exchange of 8.57% over the last three days. Total trading
volume was only R$ 16.36 million. ( ZH )

Bill Buckler: Steve Kaplan of the Gold Mining Outlook reports that since the gold sale, the Australian dollar has collapsed to a 1-1/2-year low. bond yields have soared, and real estate values are collapsing. And he reasons that this is due to the gold sale. Your views on this would be appreciated.

Donald: ( Brazil ) We will muster The World Bank, Mr. Yen and and Bob Rubin to slove this problem promptly.
Hell, we can open a more plants there in our quest to control the world economies.
After we close their gold mines down, we will reactivate them under our ownership and use our motto of "One Big Happy NWO". Hell we will have all the property and all the gold.
I am so happy that I can S__t. Even forgive the Butcher of Bagdad.

Crystal Ball -- Thanks, I asked a few people at work about that tune, everyone knew it but.... Then I went searching on the Web! Finally, a co-worker said REM.

Hell of a rally in the tech stocks. It caught more than a few at work by surprise when the company stock went up about 10% today. I guess I'm a broken clock. This market ( in techs anyhow ) has a blow-off feel to it. Doesn't mean that they can't go much higher.... I just have that funny feeling. Then again, I am holding gold stocks and dead HUI options... What do I know?

I have one question for the option pro's out there, when will public companies be required to disclose the true cost of the stock options granted to employees? ( In other words, KEY people {upper brass} ) I understand that Netscape would still be showing a loss from day one until now if the disclosure were required. I wonder what that would do to the stock price? Then again, there is amazon.com...

Somethings to bull side,
http://www.futuresource.com/cgi-bin/get32.exe
happy trading.

Bill Buckler -- Anecdotal evidence? Coin sales are UP!?

http://biz.yahoo.com/finance/97/07/15/y0023_z00_20.html

Selby: This is all quite reminiscent of last autumn when you were being excoriated here for your prophet-in-the-wilderness assessment that the gold price was going to decline rather than skyrocket. Well, the charts I looked at today bear testament to the fact that you were RIGHT. It ain't A popular viewpoint but we all know where we are in this $#@&!! market.

By the way, I also checked Bart's rhodium chart today... I am indeed a novice...anyone care to present a dissertation here on rhodium, its history, uses, producers, and possible use as an investment vehicle? Thanks in advance, and I'm back to attending Kitcos Anonymous...trying to get a grip on my habit...

And whom do you believe?????

http://biz.yahoo.com/finance/97/07/15/y0023_z00_17.html

Do I detect a little stress among the Kitco-ites today? Could those debating Selby be a little envious that he still has his cash intact? Personally I admire Selby - a conservative investor, with the courage of his convictions, waiting for signs that things are turning around. I wish I had better insight. Not wanting to get left waiting at the station, I started making some selective purchases of S. African stocks a couple of months ago and have watched them lose 30% of their value. Also invested in some Rydex Ursa, too early, and have watched that decline significantly. Fortunately, I still have some dry powder left, but my trigger finger is getting itchy again.

I have learned a lot from Kitco, in the last few months, and I think I am making better decisions. My thanks to all of you for taking the time to present your logic and pass on your advice!

Speaking of my trigger finger getting itchy, have you noticed that Durban Deep ( DRORY ) has dropped 70% in just 4 months - from 9 to 2 5/8? Unbelievable? Most of the other S. African stocks have been creamed as well - much more than the N.A. companies. Fortunately, the Blyvoor, which I bought before the lastest crash in the gold price, has held up. Perhaps this is an indicator that the S.African stocks are reaching the point that they cannot be driven lower ( unless they close ) .

Looking for another possible suspect who might be driving the price of gold down? Consider this. S. Africa mines the most gold and would like to control costs ( easy John D. - just trying to make a point - which you made yourself not long ago if memory serves ) . Do you think the S.African mining establishment might have a hand in putting pressure on the price of gold, to the point that several mines are on the verge of closing? Seems that this would give them a VERY strong hand in the labor negotiations. If so, now that these discussions are completed, perhaps the price of gold ( and the price of these stocks ) will mysteriously go back up. Lord I hope so!

P.S. I don't favor betting among Kitco participants. We are all betting our respective fortunes with the decisions we make everyday. We don't have to take money from each other. It will be clear who is right and who is wrong. Betting tends to make people take sides and puts us in the role of antagonists. We all lose if betting results in resentment and hard feelings, and leads to reluctance of people to share their views with us. I treasure this free flowing, open forum.

EBN has Australian Dollar at .7323. They probably sold their gold to weaken the A$. Let the market do your devaluation for you so that you are not embarassed by it.

Boy, this contagion stuff is everywhere!

http://biz.yahoo.com/finance/97/07/15/tmx_z0009_1.html

All [first post please be kind]
Lets say that the super rich or "they" are getting ready to take the great unwashed to the cleaners as in 1929. Wouldn't they want to hide their wealth in precious metals. Therefore they would be looking for any method to force the price of Gold and Silver as low as possible.

Disinformation, ridicule, outright lies, and manipulation of markets etc. would seem to be SOP. IMHO all of the above and much more is occuring on a daily basis and therfore should only encourage the rest of us who have every reason to believe that these things are happening to hold on and get ready for the disaster that will surely come! The longer it takes the deeper the fall in world markets. This fits the scenario of the one world government groups very well.

TTFN

itsy bitsy trader
Have you counted your chickens too soon about Crystallex? Bloomberg is reporting that Placer Dome won the court decision and Placer's stock was up today. What is this vheadline news whose URL you posted earlier anyways?

DJ - Here, Here!

The ultimate defeat, infighting! Those who said gold was going down were right. My congratulations to you who predicted this outcome. I sincerely hope that you profited. No sarcasm intended!

Now, when does the elevator stop? Surely, I hope it will not crash through the basement concrete slab! Currencies are moving! What is gold? A commodity or a currency? Is it both? CBs are not happy that their currencies are commodities! They did this themselves when they adopted the free floating monetary system. Markets are annoying things, aren't they! :- ) )

Why has the U.S. - fountainhead of antigold sentiment - NOT SOLD any of its gold while encouraging its allies to sell?? - Coles Market Insights poignant question:
http://www.gold-eagle.com/gold_digest.html

Skylark: My guess why few are studying the London physical market is because of its secretive nature and opposition to normal trading disclosures that are available from American regulated derivative markets.

Does anyone know if Daffy Duck has been terminated from the governorship of the Australian Bank ?

Cheers.

We have a basic rule on this list. Please don't use a name that someone on the list is already using. It gets confusing. Try to add a last initial to "Bob" but I think there are two more Bob somethings out there.

Cheers

Skylark ( July 15 19:14 ) I read Steve Kaplan's comments. The implication is that the $A fell as a direct result of the announcement of the RBA Gold sale. There is no doubt that the annoucement had an effect on the $A, but it has been falling since last December.

Here are some representative levels ( spot future basis )

12/2/96 0.8173
12/24/96 0.7987
4/11/97 0.7865
23/5/97 0.7688
6/13/97 0.7515
7/3/97 0.7531 ( day of RBA announcement )
7/8/97 0.7438
7/14/97 0.7387

There is no doubt that the $A slide has accelerated since the RBA announcement, but what has *really* been affected is the Aussie stock market. The All Ords hit an all time high of 2745 on July 2, the day before the RBA announcement. It closed on July 15 at 2637, after falling 62 points ( 2.3% ) over the past two days.

The fall in the $A is a direct result of the "policies" of the RBA. It has cut local rates to the point where Aussie official rates are the same as the Fed Funds rate - the first time this has happened since the Dollar was floated in 1983. On top of that, it has cut the PAR ( Prime Assets Requirement ) of commercial banks in half ( from 6.0% to 3.0% ) . And, of course, there is the Gold sale, designed to top up the government's coffers by remitting interest earned on the newly acquired bonds.

Unemployment is driving both government and RBA policy in Australia. There is almost unanimous agreement amongst both bankers and currency traders that the RBA will cut rates again - either at their next meeting in the first week of August or before. This is the main impetus for the slide in the Aussie Dollar.

Just thought that a few would be interested in this article in the London Financial Times
Central bankers around the world are becoming nervous and their
concerns are not confined to the current financial turmoil in Asia. The
recent annual report from the Bank for International Settlements ( BIS ) , the
central bankers' bank, worries that the frothiness of markets could have
systemic consequences. The state of the international payments and
settlements systems is a continuing focus of BIS concern.

These remarks came after Mr Alan Greenspan's comments about irrational
exuberance in markets. And they echoed earlier strictures from Mr Gerald
Corrigan, a former head of the Federal Reserve Bank of New York, who
warned that the growing complexity and integration of financial flows
would make it much harder to manage shocks such as the 1987 stock
market crash.

Thankyou for responding. Will Silver Bob do?

Conflicting stories out on Crystallex. Now stating that Crystallex won!!!

Looks like gold is heading DOWN bigtime...whatzup??

Financial Fairy-tale or Expedient Global Monetary Necessity: Global Gold Standard?! STARTLING IMF data demonstrate its feasibility. BOJs T-Bond holdings is the keystone for success. EMU member participation essential.
http://www.gold-eagle.com/gold_digest/oracle714.html

There have been comments about the large miners getting together to squeeze the shorts. Likewise BT and his ilk. As I have posted before, rising gold is not necessarily in the interests of strong hands right now. ABX is good for a couple of years. It is to ABX's advantage to see gold blow out to 280 or 250 ( around cost of production ) for a while so that it can aquire good properties at cheap prices.

Likewise for BT. If he can drive down COMEX and buy quietly off market or in the LBMA, then he would be crazy not to.

As Bob ( rkm@harborside.com ) points out it is in the interests of "strong hands" to shake the tree. Firstly, to reduce cost of aquisition. Secondly, and more importantly, to create the sell volume that they require to build their positions. Smart money gets rich like everyone else - buy low and sell high. If it takes a little manipulation to get there so be it.

However, at some point low gold will be a liability for CB's. When the markets turn down a lot of pundits will be citing deflation and particularly the excellent deflationary signals sent off by gold.

REB @12:25: "If they were to sell all or most of their holdings, there would be a real possibility that gold could become a form of "black market" money that would be out of their control."

I agree with you completely. The only way that the CBs will be able to have their way with us is by maintaining absolute, iron clad, control over all potential rivals to fiat currencies. Gold most obvious. If all gold reserves are dissipated into the market, it would mean the bitter and final end for guvamint "money" as we have known it.

Any talk of selling off gold reserves in favor of interest bearing securities is just that. Talk. 'White Papers' in advocacy of such are merely for public consumption. ....... In the meantime, perception remains reality and the reality ain't comfortable. In the meantime.

Noticed that there was a little skirmish today. Its always good for the system. Selby, you've had the success of your former pronostications, but somehow as NOMERCY pointed out you don't seem to have very persuasive reasons to defend your 250.00 forecast, which sounds a bit farfetched. If it does you are the chosen guru for the group if it fails, Your promised silence, is welcomed.

Two interesting headlines ( stories ) out of Asia via the EBN Asian news
network: ( 1 ) Thailand May Need IMF Help & ( 2 ) Japan Defense Paper
Urges Watch on China...no wonder the Japanese recanted on
Hashimoto's Columbia University gold statement...

The Japanese are also frightened of North Korea's nuclear capabilities
and desperation. Conclusion: Japan desperately needs U.S. military presence and good will and will do nothing to upset the apple cart.

One last thought. If the CB's were going to remonetize gold as suggested by Oracle on gold eagle then it would be interesting to speculate what conditions they would choose for that operation. I think many of those are now in place. However, there has to be a compelling reason. That would be some form of currency instability. Particularly, currency instability that is percieved to be threatening these parabolic markets.

If we get major corrections in the markets and there is spin to the effect that this is due to currency problems then this would be the time to expect a remonetization move.

Many of the countries that have sold off postitions would benefit from a lower currency to enhance exports ( and jobs ) . They would want to avoid having a proportionately large position in gold that would result in an expensive currency. Sort of pre-emptive devaluation.

EBN indicates gold down $1.50 only.

Well you KNOW the bottom has to be in or damn near it ( +-2.65 ) MY WIFE ASKED ME IF GOLD WILL EVER COME BACK AND SHE DONT KNOW SQUAT ABOUT MARKETS ( 'cept spending it on clothes & such ) , so I'm using it as my indicator in GOLD ( why not everything else failed! ) SSSSOOOOO I'm going to cal it the "WIFE INDICATOR", time will tell
CAPNKEV

PS, hi ya EARL, SELBY, DA, CHEROKEE & ALL THE GANG ( soory cant name em all ) BART 'll get pissed

Gold Is Down $1.40 in Asian Trading. When will this maddness end if at all ??????? HELP !!!!!!

Bill Buckler, Bob: Thanks for the response.

Selby: Your "apple market" analogy was great! Word pictures are very effective teaching tools. Keep 'em coming. I remember your February posts and I remember wishing you were wrong...and you were/are right.

Panda: I love tech stocks! But how long can this go on?

Nomercy: Gold at $35? No U.S. citizen could purchase for that in 1971. As soon as it became legal to own, the price was nearly $200 as the Europeans sold it back to us. Selby is right when he says that gold has been a lousy investment for 17 years. I would much rather have had Microsoft or Intel shares. I believe this will change, but when? My heart is with the goldbugs, but my investment capital is dancing between electronics and energy services trying to make up for lost time "enduring" the bear market in gold. Why fast when you can feast?

geff @14:57: Bulls only site?? Those unable to rationally counter the bearish argument are only fetching for a triumph of hope over reason. Selby and RJ are the most prominent bears at the moment and do us all a great service with their arguments. ..... D.A.'s counter, earlier today, was an excellent response to Selby's opinion. .....All of which requires a paraphrase. This, by way of Newton and Cherokee; if we are to see farther we must stand on the shoulders of giants. .... BTW, I wasn't disagreeing with your post. Merely using it as a vehicle for a short ..... something or other.

Steve - Correction. According to Bart's wonderful 3-day chart, it was the Sidney market that took gold down. It has done this for three days straight, all in the hour before the Asian market opened. Haven't a clue why. Doesn't look like it is anything to get excited about these days.

Speed:

I am glad that you are profiting well from the great rebirth of the tech stocks. I am curious, do you have an exit strategy? What will inform you that it is no longer prudent to speculate in this area? I'm asking because I can't find any reason to own any stocks at these valuation levels and I'm wondering what other people who do own stocks see as both the rational for being in and the reason for exiting.

Bloomberg News has gold down $1.10

From Thailand: Baht Jitters
Pare Index
2.65%

Business Day
Welcomes your opinions or
suggestions.


MARKET jitters over the
weakness of the local currency
plus tight liquidity drove the stock
market down to end off 2.65
percent in thin turnover yesterday,
brokers said.

"Investors believe that the baht
isn't yet stable and will slip further
from today. They think it's risky
to hold baht at present," said a
broker at Securities One.

The composite SET index lost
16.64 points to 611.91 on 3.4
billion baht turnover.

The SET-50 index fell 1.60
points to 45.52.

The baht fell sharply to a new
record low of 30.80 per dollar
early yesterday on a spillover
effect of speculative attacks on
other regional currencies, dealers
said.

The baht recovered ground in the
afternoon, to trade at around
29.85/30.00 in mid-afternoon in
the onshore market compared
with 30.30/30.75 in early
dealings.

Bank of Thailand Governor
Rerngchai Marakanond told
reporters that the central bank
had intervened by selling dollars
to help stem the baht's fall against
the US dollar.

Apart from worries about the
baht and tight liquidity, brokers
said investors also preferred to
stay on the sidelines awaiting for
half-year earnings results of banks
and finance companies which are
scheduled to be released later this
month.

Yesterday two banks including
Bank of Asia and Siam City Bank
announced their six-month
earnings results.

Bank of Asia said its unaudited
net profit during the period
amounted to 846.50 million baht
compared to 807.07 million. The
shares dropped one baht to
21.25 yesterday.

Siam City Bank said its unaudited
first half net profit stood at 1.82
billion baht versus an audited net
profit of 1.72 billion baht in the
same period of 1996.

Siam City Bank gained 0.25 baht
to 15.75.

Bangkok Bank topped the active
list, falling three baht to 159.
Nava Finance shed one to 17.75
and United Communication rose
seven to 110.

Brokers said they expected the
market to continue its downward
slide today morning but said it
would likely bounce back in the
afternoon as the market had fallen
quite sharply already.

Bob @15:25: Absolutely goddam outstanding! Committed to print for further perusal, rumination and outrage. Mining company CEO's are playing the same ball-less game as their counterparts in general. All the while cashing in on the perquisites of position, while having the temerity to couch such self serving horsecrap as being in the best interests of shareholders.

If any of them should find something in their collective scrotums ( with appologies to Margaret Witte ) besides a vacuum; perhaps they would consider holding product from the market in search of better prices. If they did perhaps I would consider holding on to the remainder of my ABX. After all, only "dyed in the wool" goldbugs remain as shareholders anyway.

Earlier, I posted information on Japanese concerns over China. Here is the URL:
http://www.yahoo.com/headlines/970715/news/stories/defense_1.html

Selby and RJ and the other bears.
You must feel a little like Galileo or many other famous people who have preceeded you. Initially when they made their discoveries their ideas were rejected by the masses, some were even killed for their heretical opinions. Investing in gold was about the worst possible investment decision people could have made for the past 15 years or so and it sure looks like gold is going to go a lot lower, perhaps lower than $250, but certainly lower than $300 as the signs are there. The problem is there is a whole industry of analysts, newsletter writers, brokers, and dealers who earn their living hyping gold. This selloff has little to do with the sales of gold by the central banks. It is just that the central banks have finally woken up to the realization that many others have already made and that is your ROE is not high enough to keep much gold around. It is quite simple.

Its easy to take a little flack when you're $80 bucks ahead of the game. I wonder what would be the reaction if I had predicted a $130 rise and the price was now $460 and rising? Happy that some agreed as well as disagreed and that in the end some on-topic discussion occurred today. Anyway I have said all I have to say and will follow Novice's lead.
Rhodium : http://ghs.bcsd.k12.il.us/projects/class/periodic/1997/Rh.htm

I have seen this term so many times, "speculative attacks" , so could someone please define it for me?

If I buy a foreign stock, am I 'speculatively attacking' the U.S. Dollar?

What if I buy gold coin or bullion? Is this a 'speculative attack' on the U.S. Dollar?

Just what causes this 'speculative attack' anyhow? Is it like the common cold, when you're infected with a virus? In this case, no one wants to hold your inflated currency? Hmm. What a curious thing, this 'speculative attack' is.

Front @18:25: Your agreement with Selby is correct as far as it goes. It does however fail to recognize that the present situation would have been far more difficult and perhaps less profitable without the conivance of the Central Banks. Hedge funds would be unable to short to the degree they have without access to those above ground supplies. Not to mention the unrelenting pyschological benefits that were supplied as well.

For speculative short sellers, it has truly been a no brainer. It should have been recognized by us goldbugs sooner. ...... But without the fine commentary and opinion here on Kitco, I would still be in the dark regarding such matters. ....... So soon old. So late smart.

Byron: who do you think fed the first story to the media ( reuters and bloomberg ) .... PDG? As a KRY shareholder ... just a matter of time before I tell them ( PDG and the CVG {Corrupt Venzuala Gold Corporation ) to get off my property!

D.A.: You asked what my exit strategy is and my first impulse at this hour is to say "a surge of adrenaline and a well broken-in pair of tennis shoes". Seriously, my mediocre thinking is to do what I did ( too slowly ) in 1995 when the tech sector soared, and that is sell out on the way down. I will be stopped out well above my buy in point ( unless the whole thing just crashes in one hour ) . I lost some of my profit by staying too long in techs then, but I've just plain lost waiting for the great gold bull market of 1997 to materialize. Your argument about value has been true for a couple of years hasn't it? Look at values since Greenspan's December "irrational exuberance" speech. You are correct by any traditional measurement, but look at the "scoreboard". If you want to play you have to get in the game. I believe that by following the money, money can be made. The good trades that I have made have been from following, not predicting, sector trends, and from selling at a pre-determined limit above my buy-in ( except with gold where my heart ruled my head ) . Lastly, as the speculative fever increases, I am playing with less and moving more to cash.

Curious, Nippon raises its copper price effective immediately.
http://biz.yahoo.com/finance/97/07/15/z0009_155.html

To Mack Truck ( or is that Mack Mouth ) ... If you think you no what you talking about concerning KRY ( crystallex ) , then short it! Put your money where you mouth is!

WDL: Re you posts concerning Japan's comments regarding the military buildup in China. Isn't this just what we saw happen in Germany in the 30's? And yet there are those calling for even less defense expenditures in the U. S., when we are spending less percentagewise of GDP than we did in the late 30's.

Roebear @18:42 - Your response was that of a gentleman. I now understand the integrity question. There have been many who, at times, believed that I was someone else, or that someone else was me. I read Kitco daily and have never seen anyone misappropriate my name. Had I ever read an RJ post that I did not write, believe me, I would have been shouting from the rooftops. By the way, RJ is not an Internet handle. RJ is how I sign my checks, and is how I am known to my clients and friends. I wish I could say that the initials stand for a name that must be hidden at all costs, like Raul Jazz, or maybe Rainbow Jesus, but it is only Richard James.

As for the apparent schizophrenia, all different faces of the same man. I have never posted under another name and never will. This policy has the obvious consequence that I must take responsibility for all preambles and portends, as today I do. I read and post at Kitco with the full faith and understanding of the spirit to share and learn.

So, a rational response, this. So much for now, I feel a rabid spell coming on.

Just in case anyone really cares - Comex gold stocks were down 32 oz today to 869,659 oz. eligible stocks were 348,055 oz . Open interest as of yesterday was 214,887 contracts, which means there is a "solid" 1.62 oz of gold to cover each 100 oz contract. Boy, that should make you feel secure if you are short at 319! In other words, this fall in gold prices has been accompanied by approximately 50,000 ounces actually sold short to cover the 'new' 60,000 contracts equal to 6 MILLION OUNCES. Oh, that must be reassuring!

Also of note ( Strad Master and D.A. pay attention ) Comex silver stocks have dropped about ten percent since the first of the year when the 'new' warehouse stocks appeared. This looks like a real drawdown to me and fortells an interesting future for silver!

BJ @20:36: I think your comments regarding Selby and his opinions are both ungracious and unwarranted. We are not in contest here.

JohnB:

If you truly believe that CB's are concerned with ROE then you ought to be scared ^* ( &^. The function of a central bank is too keep things smooth and not let imbalances in the system get out of hand. They are the last line of defense. Gold is held precisely because it is an asset which is uncorelated to the other financial stuff of which they are natural holders. As such it supplies some measure of insurance and adds to the balance in the system.

If the mandate of CB's is to maximize return on assets for their respective governments you can be sure that some will succeed and some will FAIL. Just like all the rest of the speculators in the world. If one of significance FAILS, the whole shooting match could come apart. If you've lurked this site for any period of time you'll know that I'm not one for predicting end of world, financial meltdown stuff. Lately however, I'm actually starting to believe that systemic risk is increasing and no one is doing a damn thing about it. Watching little countries like Albania sort of fall off the radar screen because of a Ponze scheme gone awry is a bit perturbing. That a few hedge funds can walk in and blow away the financial markets in a country like Thailand is more disconcerting. Now we see that Brazil is having a wee problem. The system is starting to spring leaks.

Tommorrow I receive my incentive comp bonus from our last quarter, which was very good. I'm actually contemplating going out and buying a substantial load of metal to stick in a bank vault. Thank you for your post. It has raised the antennae.

WILL ALL GOLD BEARS PLEASE REFRAIN FROM POSTING HERE AT KITCO FOR THE FORSEEABLE FUTURE?!!

Arden:

Thanks for the heads up. I think that several thousand more ounces of silver will be leaving the warehouse shortly and I know just where its headed.

To Big Mouth or Mack Truck .. whatever you name is. The ruling in VEN ( that halted KRY stocks ) ruled all motions in KRYs favor that the judge had authority on. The other items were outside of her jurisdiction. They will be taken up by the CSJ ( which by the way ruled in KRY favor in three previous rulings regarding the LC 4&6 properties ) . Again ... if you don't believe, you can always short KRY and go long on PDG. : )

Here is some more clarification on what the ruling was about ( on KRY ) :

CARACAS, VENEZUELA, July 15, 1997 -- Crystallex International Corporation
( KRY on TSE and AMEX ) announced that it received late today from the
Venezuelan Supreme Court notification that the Court has formally admitted
applications made by Crystallex's Venezuelan unit, Inversora Mael, C.A.
seeking enforcement of its ownership rights over the Las Cristinas 4 and 6
gold concessions.

The company stated that today's notice from the Court's Admission Judge:

1. Admits the majority of Mael's legal petitions for consideration by the full
court.

2. Notes that because of timing issues related to statutes of limitations the
remaining two petitions could not be formally admitted today, but may be considered by
the full court as part of its review, and expressly establishing
that this does not prejudice the validity of Mael's rights.

3. Stipulates that today's actions FULLY RECOGNIZE Mael's underlying
rights to the concessions.

Oh by the way ( go try and find the articles by Bloomberg saying KRY lost tomorrow ) : )

All - I see a lot of talk about $275 or $250 today. Some see this as impossible, some see it as unlikely, some see it as possible, and others see these levels as inevitable. Im somewhere between possible and inevitable. Some questions have been raised about these levels and why should the decline stop there? I think we all - in this I am also guilty - use the numbers as if they actually meant something. Instead, look to these benchmark numbers not as absolutes, but just one way to gauge the market. These prices represent psychological barriers that, once breached, could lead to further losses. In fact, none of these levels represent much beyond this. $299 gold is worth exactly one dollar less than $300 gold, yet would any financial publication let this pass unmentioned? No, this is the stuff of headlines. Likewise, the selling by CBs does not force the price of gold down, but simply undermines investor confidence in gold. Gold is worth less because less people want it now, thats all. It is a commodity and, as such will rise and fall, this is what commodities do. Lets not get to tangled up in various benchmarks but rather, the market as a whole. Stripped of emotion and viewed with rational eyes is the best way to protect and build your fortunes.

D.A. - Regarding your comp check: you might want to wait a bit before buying some metals for delivery. There will be ample oportunity at lower prices.

Mooney was asking questions about this company last year at about this point in time, I had ran into a director of this company in 1993 on Vancouver Island. He spoke of a huge consession it held in a South American country, but they were in discussion of legal ownership of the property. Well just like it says in the Ven article they pulled the rug out from under Placer Dome on this one. Good going isty bitsy and Mooney
I hope you rode this position out, long time coming but she'll move
when the TSE lifts the halt on KRY tommorrow. 20 mil. ozs.

The knockout punch for gold is coming soon in the form of the US government selling a considerable portion of their gold holdings. After the dust settles..BUY,BUY,BUY..the bottom will be had...

Fidelity Select American Gold & Precious metals Chart.
Ten market days ( seven hours / prices per day )
http://www.geocities.com/WallStreet/5969/agpm70hr.gif

These currency developments would appear to bear watching. As you know, the devaluation of a currency by a country re the dollar causes an immediate increase in the price of gold and encourages inflation in that country. Further, in those Asian counties that were pegged to the dollar, after being free, their currencies compete with one another and each country has an incentive to lower its currency to protect exports and be a leading exporter. This of course is deflationary for the importing global community as imports become cheaper but inflationary for the devaluating country. I wonder how this is going to play out. Will gold become more sought after in the devaluating countries? And if so what is the impact? Will citizens of neighboring countries seek gold in view of the consequence to their neighbors? Will lower priced imports cause a greater trade surplus in the US and what is the impact?

Secondly, in Asia, since a devaluation of a currency of ie Thailand means a stronger Yen, it harms the Japanese economy as exports to the country are threatened with a higher price. Thus the devaluation encourages Japan, as it has recently publicly announced, to keep its interest rates at its present level to prevent the Yen from unduly rising. But it is limited in protecting against a rise in the Yen, since it cannot lower interest rates as they are already at a rock bottom. In addition, since Japan is a leading creditor to these devaluating countries, any problems there, including a devaluation of the currency, may cause problems to an already fragile Japanese banking system.

And as these countries devalue their currency, financial investors will be encouraged to move money from these countries into the USA, which may affect the value of the dollar and bond rates.

Thus Japan is confronted with at least two fronts in maintaining a stable low Yen: the USA and Asian counterparts. It seems to me it may be compelled to sell US bonds if the Yen becomes too strong Vis a Vie the dollar as it may not have any alternative. But whether that will have the intended affect on the dollar is another question.

This business of a currency devaluation is suddenly coming in from all over. - Asia, Australia and now Brazil. And if these and other countries start competing to be the lowest cost exporter by use of their currencies, it may have profound consequences on the stability of the global financial system. .And perhaps gold. After all, if a country devalues its currency, its currency reserves are devalued as well - that is except for gold which becomes more valuable. Critisim Welcomed.

Bob M where ddid you get your information regarding your last post ???

itsy bitsy trader
I'm not trying to burst your bubble; all I'm saying is perhaps your celebration is a bit premature. I just took this off Reuters.

July 15, 1997

Rival lawyers claim victory with Cristinas
ruling

CARACAS, July 15 ( Reuter ) - Rival lawyers from Canadian mining companies Placer Dome Inc
and Crystallex International Corp both claimed victory Tuesday in the long-running dispute over the
gold-rich Las Cristinas concession in southeastern Venezuela.
Lawyers for both companies acknowledged that the a Supreme Court preliminary ruling on the
dispute Tuesday was confusing and complicated but disagreed over how it should be interpreted.
"The Court accepted all our actions against the resolutions of the Energy and Mines Ministry in
1996 which affected our rights," Ricardo Cottin, an attorney for Crystallex in Caracas told Reuters
in a brief telephone interview.
Meanwhile Jose Antonio Pinedo, legal representative for Placer said the Court's ruling was clearly
in its favor.
Pinedo said that while the court recognized Crystallex's right to challenge the removal of copper
rights at the concession, an earlier removal of gold exploitation rights at the concession was ratified.
The court threw out this claim because the gold rights were revoked seven years ago, Pinedo
said.
The complicated legal dispute initiated by Crystallex earlier this year centers on the rights to
concessions four and six of the lucrative Las Cristinas property.
Crystallex says that the rightful owner of the concessions is Inversora Mael, a company which
Crystallex bought last year.
An independent legal source consulted by Reuters said that while the Court's decision Tuesday
was a setback to Crystallex's claim, it was only a preliminary ruling and would inevitably be
appealed.
"This is not the end of it," he said.
Cottin said that 80 percent of Crystallex's claims had been accepted by the court and the other 20
percent would be appealed.
Placer has estimated Las Cristinas' reserves at more than 20 million ounces. Crystallex, which
operates a small mine nearby, has said Cristinas could produce between 250,000 and 400,000
ounces of gold per year.
Venezuelan government officials have insisted throughout the dispute that Crystallex's claim is
unjustified and that the joint venture in which Placer has a 70 percent stake will go ahead.

Never trust Venezuelan goverment....they make the Indonesians look like amatuers when it comes to fleecing foreign investors. Having observed the ven "court procedures" during the last 11 years, I believe that KRY are way over their head, and the battle is only just BEGINNING. Remember that we were voted the second most corrupt country in the world two years in a row.....right after Nigeria. Believe nothing of what you hear, and less of what you read.

Steve- its coming down the pipe...

Could someone please enlighten me? If the blame for gold's fall is on all the shortsellers, then why is the stock market still going to record highs when the short interest there is the highest in 12 years? I thought a lot of short interest was suppose to be a contrarian's dream since eventually all the shorts have to cover, driving the price back up. What am I missing here?

Itsy bitsy trader
Perhaps Reuters has it all wrong eh?
July 15, 1997

Venezuela court rules against Crystallex

CARACAS, July 15 ( Reuter ) - Venezuela's Supreme Court said Tuesday that the claim by
Canadian mining company Crystallex to concessions four and six of the gold-rich Las Cristinas
property in southeastern Venezuela was inadmissible.
The preliminary ruling, which legal sources said Crystallex would undoubtedly appeal, ruled the
Energy and Mines Ministry's decision to annual the concessions then owned by Inversora Mael
SA, could not be challenged because of the length of time elapsed. Crystallex bought Mael last
year.
"The decision basically declares inadmissible the case of Mael to the Cristinas gold concession,"
said the legal source, who knew the details of the case well.
Crystallex made moves in early 1997 to reclaim the Mael concessions which were due to be
developed by a joint venture of Placer Dome Inc and state-owned Corporacion Venezolana de
Guayana ( CVG ) in a $576 million project.
A separate claim to the Mael's copper rights to the concession, revoked in October 1996, were
deemed admissible, the legal source said.
"This is not the end of it," he said, stressing that Tuesday's ruling was preliminary.
Placer has estimated Las Cristinas' reserves at more than 20 million ounces. Crystallex, which
operates a small mine nearby, has said Cristinas could produce between 250,000 and 400,000
ounces of gold per year.
Venezuelan government officials have insisted throughout the dispute that Crystallex's claim is
unjustified and that the joint venture in which Placer has a 70 percent stake would go ahead.

Is this Crystallex story going to be titled: "The Son Of Bre-X"??? : )

Bob M. I thought so !!!

GFD. Thanks for the answer.

Byron - Don't buy any resource stocks ending in X. Bre-X, Solv-x, Crystallex. Whats NeX ? ;- )

would like to know about LME and Zurich fixing mechanisms. Anyone who knows is requested to reply.

Lots of gold bears beginning to show up in here..the bottoming process` is slowly happening..but its not here yet...watch the US governments actions over the next few weeks, keep an eye on Fort Knox, there is going to be more storage room available in there....

Hey Mack Truck or other clowns: We'll see. Who do think fed the information to the reporter about the case ( Was Reuters and Bloombug getting their "hot" story from the Placer Dum Cheerleaders ) . We'll see. You can always short it!

CMAX: Thanks for weighing in with your comments on KRY and Venezuela. Always a pleasure to read your comments.

US government quietly selling gold to redeem T Bonds for the Japanese..so as not to ingest more US currency into market...watch carefully

Vieserre An excellent post, this is happening right in front of us. A little wave or tsunami? The email George Cole posted this AM for "The Role of a Central Bank in a Bubble Economy" by Professor Geoffrey P. Miller, this is a good read with inside info from Japan on their bubble crash. I haven't finished it yet ( I have an 05:00 meeting again! ) but if
it stays this informative we ought to see Vronsky about getting it posted on Gold Eagle ( if the Prof is interested ) . Some eerie similarities to USA 1997, "no inflation in sight" etc. Somehow it relates to what you are saying about currency devaluations but I am too smoked to verbalize it. Good Night

Bob M. - If our govt could get ANY piece of legislation written and passed within a few weeks, the Earth would stand still.

JOHN DISNEY: Is Durbin Deep a good bet at this point? ALL: When this thing reverses, it won't be @ a dollar a day IMHHO.

EB - Stay away from numismatics like the plague! The premiums will forever wipeout any chance of profit. A collectable is only worth what someone will pay for it. As for numismatic coins, the vast majority are worth far less than listed in the books. If you have doubts, buy a collectable coin, then try to sell it.

Stay with bullion coins and buy low. The spread is usually 4% or less, this is an easily surmounted cost. If possible, buy a pure gold coin. The three most popular are the Maple Leaf, The Australian Nugget, and the Austrian Vienna Philharmonic. These are all .9999 pure. Beware of the Maple Leaf and the Krugerrand if you have concerns about reportability. When you buy gold, there is no requirement to report the purchase. When you sell bullion, Maple Leafs, or Krugerrands, the purchaser is required by law to take you social security number and report the sale to the IRS. If you refuse to supply a SSN, the purchaser is required to withhold 30% and forward that to the IRS. Other things being equal, the nonreportability of VP, NG, and the American Eagle makes these a more attractive holding.

By the way, there is no reporting requirement to the Platinum Maple Leaf. Reporting requirements may seem capricious, but there is reason to the madness. If ever a futures contract was traded on a commodity, it is reportable, all else is not. Reportable forms of gold are, bullion, ML, and KR. Silver: bullion, 90% dimes, quarters, and half dollars, as well as 40% half dollars. Platinum: only bullion is reportable.

I hope I have explained this coherently.

RJ, Thanks to both of you, Mr Rational and Mr Rabid, for the education of this little speculator.

Mack Truck ( and other bozos ) :

It is Placer Dum that will be saying .. "I'm shocked!"

The only items that weren't ruled in KRY's favor were not ruled on because they were outside the jurisdiction of the judge. Those decisions will be made by the CSJ in VEN ( which has ruled in KRY's favor previously ) . It appears to me, that the reporter got his "news" from the placer dum cheerleaders or has a reading comprehension problems ( when it came to interpreting the Judge's ruling ) .

I guess you may lose a little faith in Bloombug and Reuters?

: )

Telecaster- they do not need to write legislation-ever heard of Executive Orders?

Interesting note Bill Buckler@20.17.

So it seems Bank of Oz has already LOST 10% of its reported gold sale proceeds , if it invested in $US Dollars

Leaner: I believe your post hits it right on the nose on KRY.

Vieserre -- I think you've got it. The games have begun. I wonder, what would be the best anchor to have in a gale?

Good night all............

Bob M - Go on. I've been waiting to hear the rest of the story...

Bob M - The US has never, nor will never sell a single ounce of gold. Someone is taking you for a ride. Short is the place to be, but don't count on US gold sales to make it happen.

Machf15: I will take a stab at your question. A short in stock must be on an uptick - thus it is hard to drive a stock down, and the stock market comprises a number of different stocks - thus one must look at which stocks are being shorted ( the short interest in stock also includes arbitrage ) . So the ability to drive a stock market down by shorting certain stock is far less effective than shorting a singular commodity. But once the shorts are in place, the concept is the same. That is, the short interest provides additional fuel for a rise in the shorted stocks or commodity.

Amit: Regards London Gold Fixing information, click on the Kitco Precious Metals Spot Prices block above and then scroll down to History of London Gold Fix hightligted in blue and you might find the info you are looking for.

Vieseere This is Professor Millers' email posted by George S Cole this AM
MILLERG@turing.law.nyu.edu Goodnight All

Cmax does that mean we have the most honest politicians up in NA,
X President Bush and X Prime Minister Mulhoney work for the Munkman, they hold alot of Brown Sugar is it by legal means??

DJ: If you look at Bart's tables of ten minute prices, I believe you will see that Tokyo opens after Sydney, and one hour before Hong Kong. This coincides with the drops the last three days.

Itsy bitsy trader
I respect your opinions and for all I know you may be right. Just curious though as to why Placer was up today and gold was down almost $2.00 and Barrick was down as well.

PS Let's leave the personal denegrations at home ok?

I need a new job! 72% raise?

http://biz.yahoo.com/finance/97/07/15/y0021_z00_21.html

Skylark: Thanks. That was a shithot answer. I do like the part about it is all the same once the shorts are in. I invested in BGEIX from a contrarian view point. So far it has only made me look stupid over the last couple of weeks.

i b trader - My understanding is that KRY's challenge of the annulment of their gold claims was ruled inadmissible, due to the statute of limitations ( SOL ) , and must be appealed. In order to appeal, they must first prove that they have a valid claim to the property. Do I have this wrong.

REB and Steve: I stand corrected. I don't see Tokyo on Bart's chart and don't know when it opens, but geographically what you say makes sense. It also makes sense that a consistent move like this would happen at the opening. So it is Tokyo that is the culprit -- hmmmm?

So those with the cash are buying up gold/mines at these
going out of business gold sales. ABX is thinking about
buying GCM ( Great Central Mines in Aust. )

Who's next? Haven't drowned yet after being keel-hauled.

Mack Truck: KRY was up too ( along with PDG ) . PDG is among several majors that have been put on buy lists recently. We'll see what happens. Don't take the jabs personally ... just funnin'. I think that PDG truck has a flat ( we'll see ) . I hope you not long in PDG.

Nighty nighty. Heh ... another day ... another rumor ... another interesting story ... : ) zzzzz

IB Trader: Is the decision final, or does this mean KRY's claim has been recognized for legal ajudification at a lower court. My recollection was that any decision by the court would not put an end to the matter.

Who Moi??? Anything is possible - Anyway, it seemed
to help the negotiations. The NUM and Chamber of Mines
have struck a deal which links wage increases to
productivity. The Investec newsletter states that
productivity ( KG per man per annum ) would move from
1.41 to 1.71 under the new agreement. Kloof for example
under that scenario would see bottom line earnings
change from a loss of 1.99 cps to a profit of 44 cps
at the current rand gold price.
Its interesting to watch the NUM change from a super
aggresive red infiltrated management hating union into
a bunch of lambs - all in a few years.
Take this little item - add say a 20 % rand
devaluation , let the gold price slide to 200$/once -
and Mr Munk may see Barrick taken over by Anglos -
Surprise surprise.