Gold Discussion for Investors and Market Analysts

Kitco Inc. does not exercise any editorial control over the content of this discussion group and therefore does not necessarily endorse any statements that are made or assert the truthfulness or reliability of the information provided.

bull market
(Fri Aug 08 1997 00:03)

(Fri Aug 08 1997 00:51)
Friend of Big Earl
re: bull market....what is it you are drinking? I need some too.

(Fri Aug 08 1997 00:57)
Ron - Re your 11:10 of Aug.7 - You are right - I made a quick post without geting the multiplication correct! Now, as to the reason for the purchase. I still believe that it is just a wager. Silver does not have to go to $3.50 for the participant to double, triple or even quintuple their initial investment. If, for example, Silver, ( which had just had a $.20 down day ) , were to continue on the downward path another $.40, then the option price per ounze might go to $.20 or $.25, in which case the fund, or whoever, would be able to cash in for a quick profit in the hundreds of per cent. Risk/Reward ratio of 4 or 5 and LOTS of time left in which to hope, pray and exercise. :- )

(Fri Aug 08 1997 02:14)
of the Earth
A person posted something about the feast of the dragon back in late
June. Cherokee has now posted thoughts of diabolical consequense. Forget
about the Bay of Pigs, we are in for some real fan hitting when this
dragon starts swinging.

Also strategic investment by IMF to bail out Thailand. In the esteemed
words of fellow Kitcoites, "Things are really hotting up!"

(Fri Aug 08 1997 03:09)
Supersonic missles

Russia is poised to send supersonic missles to middle ?
and asia - per Janes. Very short script in Financial Times Scroll down a bit through articals.

George Cole
(Fri Aug 08 1997 04:05)
in Florida
December gold up 70 cents on DBC. JOBERG gold index up 0.8%. Looks like another good day for gold and gold stocks.

BULL Market; Agree that bullion is headed back to $375, probably by October, certainly by early 1998.. But that is only the first way station in a move to much higher levels by the millenium.

John Disney
(Fri Aug 08 1997 04:10)
For DJ

Ah woe is me - I have decided to devote the
dwindling remains of my useless life to answering questions
of this nature.
It is my Don Quixote quest - Enlightenment - Write it
large upon my pyramid.
A thumbnail view of rusplat 1997 preliminary results
follows with key assumptions

Tons milled 16.5 mill
Head grade 5.68 gm/ton ( total metals )
Plat refined 1.5 million oz
Net Sales revenue 3780 mill Rd
cost of sales 3190 mill rd
profit on sales 590

5.68 * 16.5/32 = about 3 mill oz total metals

3 mill - 1.5 = 1.5 mill oz pallad,rhodium,ni produced as
( report does not give relative amounts )

Assume mix of byproduct metal average price = 1066 R/oz
-thus byproduct offset = 1.5 mill * 1066 = 1600 mill

then 3190 mill - 1600 mill = 1587 mill/1.5 mill plat =
1058 r/oz and voila 1058/4.5 = 235$/oz

the problem with your numbers in your ( 1 ) and ( 2 )
is that in ( 1 ) the Byproduct revenue must be
ADDED BACK to equal the approx total cost of 3100 mill.

These numbers are from the Anglos Preliminary
Annual Report for 1997 - if you still have questions
suggest you contact their auditors.

I have some small remaining questions about whether
the Head grade includes nickel or is only palladium and
rhodium as the byproduct credit is a bit bigger than
I can resolve. But I am satified the numbers are
accurate within the range Im used to - they are
not out by a factor of 2!!!!!!!. I hope your head
is better today. Now mine hurts.

George Cole
(Fri Aug 08 1997 04:16)
Schippi; I agree with GVC on the question of FSAGX versus FSPMX. When the metal enters a sustained uptrend there is little doubt that FSPMX will substantially outperform FSAGX. The SA shares always outperform in sustained gold bulls, just as they underperform when the metal is headed south.

(Fri Aug 08 1997 04:27)
Anyone read ( or looking for a good read ) ?
"The History of Money" by Jack Weatherford
A well written book on the history of money. A good read for goldbugs, history buffs, and anyone
interested in money generally. Interesting insights. The author supports the gold standard and gives
reasons why currencies have done so poorly since
the American and British gold standards ended.
History does repeat and our current governments are not much different than the Old Roman Emperors.
Any thoughts, anyone?

(Fri Aug 08 1997 04:35)
I believe the "Gary North Story"refers to this Y2K site posted earlier here.

(Fri Aug 08 1997 04:47)
Some Katyusha rockets explode in northern Israel.

John Disney
(Fri Aug 08 1997 05:02)
For DJ

You know most S/D balances confuse people with lots
of numbers - the big problem is that any decision must
be based on a small difference between large numbers.
Its very easy to make a mistake or draw the wrong
The Mining Journal shows similar numbers to the
expensive guys you mentioned.
Believe the problem is that people got used to the
Russian stock run down and confused it with production.
If that is the case, a 40 thou oz surplus with rusian
supplies at 1200 thou oz, quickly becomes a 560 thou oz
shortfall if the stockpile runs out and real production
is only 600 thou onces. There would be little warning and
no one to make up the difference other than US strategic
stock piles.
Then add in any speculators that shorted
at high prices and you can have an interesting situation.

(Fri Aug 08 1997 05:03)
ROEBEAR: Did you read what the Fed had to say about Y2K from my evening post?

(Fri Aug 08 1997 05:20)
Donald, I only had time to glance at it, I did save it and hope to give it a better read tonight. Your comments on it would be welcome to this neophyte, but am on my way out the door to back tonight. Keep the home fires a burnin' Donald : )

(Fri Aug 08 1997 05:32)
Mornin Donald and ALL!...Just in from watchin another sunrise over the North Atlantic....BEAUTIFUL!...I see EBN Gold came back a bit and is now only down .40 but as Wall Street does,the Comex sets the tone...

(Fri Aug 08 1997 05:41)
of the Earth
Does anyone know the date on which Money Bags cracked the joke about
the President and his wallet. I'd love to send it to someone. If you do
could you post it please. Thankyou.

(Fri Aug 08 1997 05:55)
London Gold:
Investors ( ? ) put an estimated 23 BILLION into the stock market in July ( up 39% from June ) ....That makes sense.....when stox get more expensive ya buy more of em....TGIF folks!

George Cole
(Fri Aug 08 1997 06:09)
Joberg gold index now up 1.3%. December gold off a dime. Where the stocks lead bullion follows.

(Fri Aug 08 1997 06:10)
European equity markets all down....Long Bond down 7 ticks....Nikkei turned it around and was up 128.61....

(Fri Aug 08 1997 07:18)
S.Korea (It's getting interesting)
War Games in Korea

U.S. Maneuvers Cut Into Treaty Talks

Posted Thursday, 11:45 AM EDT

NEW YORK: They say you should speak softly and carry
a big stick, and that's just what the U.S. and South Korea
are doing by announcing joint military exercises  right in
the middle of peace talks with North Korea.

But this big stick business won't wash with the North.
They're complaining  quite reasonably, it seems  that
scheduling war games with 16,000 troops isn't exactly the
best way to conduct the peace negotiations currently under
way at Columbia University in New York.

The South Korean maneuvers are set to start on August
18. And Uncle Sam seems to be further antagonizing the
North by flying 150 warplane reconnaissance flights near
the demilitarized zone. Perhaps they've been encouraged by
recent reports of mass starvation over the border. But they
would do well to remember another maxim: don't beat a
man when he's down.

-- Chri

(Fri Aug 08 1997 07:40)
London Gold:
European equity markets getting weaker towards close....Pound down enough versus U.S. Dollar that they're already talking about another interest rate increase even though rates were raised a quater point yesterday...
Japan's trade surplus up 55.8% which should put more pressure on Japan to try and strenthen the Yen,which be helpful for GOLD....

(Fri Aug 08 1997 07:41)

the quote from the chinese general was on a cable program
in the houston area this week. they also quoted a high
ranking party member who spoke of deception and theft of
patent and military secrets from the west. they spoke
of defeating our naval forces in their arena, and of
another simultaneous front ( war ) to keep our forces split.

if they are able to launch missles that can hit the us mainland,
is there reason to think they cannot hit our ships in THEIR
sphere of influence? they would not even have to launch the
air-forces to eliminate our task force, as their missle program
has made quantum leaps over the last several years.

with clinton at the helm, we are at a cusp in our history. even if
our military and political machinations do not know it, the chinese
the russians know it.

the us and israel are more succeptible and vulnerable than at any
time since the 60's. the plans are in place, the players have position,
there is only one question yet to be answered. when????

cherokee!; ) anvil-to-the-hammer

(Fri Aug 08 1997 07:50)
Good morning TED!

This mornings white metal news...

Spin control over PGMs...

Platinum theft...

Almaz is not talking...

More uncertainty over platinum and palladium...

(Fri Aug 08 1997 07:50)
Hi Ted: Starting out pretty gray, and cool too. Had to sign off earlier. Dealing with a leaky water pipe. Today I should be pricing copper, not gold.

(Fri Aug 08 1997 07:51)
control freak
Yeh! And give them back their gold you bully-boys.

(Fri Aug 08 1997 07:53)
ROEBEAR: The Fed Y2K thing downloaded as a file. I tried to open it with WordPerfect but it says "unknown format".

(Fri Aug 08 1997 08:00)
All of Europe except Greece is down. I haven't seen that in a long time. Ten exchanges are down more than 1%. Everyone knock on wood.

(Fri Aug 08 1997 08:01)
Seems like the thing to do was sell the Nasdaq 100 last night on the Globex. It's still early, but we shall see what we shall see.

I thought the explanation of the dismal Long Bond performance was hilarious! The primary dealers bought the bonds to sell at retail. The problem was, retail folks didn't want them! :- ) ) As Homer Simpson would say, "Dooooooooh!" :- ) )

(Fri Aug 08 1997 08:05)
The missing word for the stock market is awesome... which best
describes extraordinary upside action. It seems Public views market
profits as ENTITLEMENTS - Must RELOAD Digest page:

John Disney
(Fri Aug 08 1997 08:07)
To All - See where Prince of Dorks Andy Smith ( what a name ) is mad
at the Russians and says they had better get supplies of platinum in
the pipeline "pretty damn quick". Gee Whiz Andy You talk tough !
Also Andy does not subscribe to the theory that stockpiles are dwindling.
Heheheh - this is starting to look like fun.

(Fri Aug 08 1997 08:10)
Chinese generals as an information source?
The Chinese navy is a brown water collection with no history, no experience and no chance of winning a fight with any U.S. Fleet ( We have more than one ) . One U.S. carrier group contains an Aegis class cruiser, a destroyer, and a supply ship in addition to one of the largest, fastest, best armed carriers in the world. The Aegis class cruiser carries 80-100 AW missles capable of engaging any airborne threat at ranges of over 80 miles. They also carry a couple of dozen tomahawk cruise missles, some of which are armed with tactical nukes. The price of gold might go up in a clash, but the chinese navy will be a rapidly depreciating asset.

I understand the antipathy toward a draft dodger president and budget cuts of defense programs, but let's not forget that what we have is better than anything else on this planet. Semper Fidelis

John Disney
(Fri Aug 08 1997 08:10)
For George Cole

Wow George - 2 NY Times articles on RSA in one
morning - With newspapers like the the NYT who needs
toilet paper??
Are you kidding me?. Some guys just hate rich people.
Rather than sit around and bitch about it and impose
capital gains tax and "progressive" income taxes why not
just cut their heads off ?? Im sure some guys in Vermont
would go along with that.
The Black, White, and colored politicians that the
NYT was at least partly responsible for getting into
power do not have to be on the take from the dreaded
monopolies since they are already stealing as much
money as they can handle from taxes.
To write that cars and TV sets and steaks are so
expensive that the average guy cant afford them and
imply that that's because of monopolies is stupid.
The price of these items is set by import export pricing
and world wide competition.
In short, the article is pathetic. This is the
kind of crap the US press and the Guardian was spouting
off 20 years ago.
Mandela now blames crime in RSA as the instigation
of the white "third force" - the NYT will problably pick
this up in a few years.

(Fri Aug 08 1997 08:12)
Good job the other day on Vronsky's site! Mornin Panda....S+P futures down 3.30 .....For what it's worth Jimmy Rogers is shorting the long bond

George Cole
(Fri Aug 08 1997 08:14)
Joberg gold index now up 1.7% as European stock markets sink. The times they are a changin!

(Fri Aug 08 1997 08:16)
John Disney: Ain't Vermont great.....

Bob A
(Fri Aug 08 1997 08:23)
to Speed
We might have it but do we have the resolve to use it? I'm on the fence on that one.

(Fri Aug 08 1997 08:24)
US Labor scene - Reality check
I guess this is the 'New economic Era' re: Fruit-of the Loom layoffs.
Strong US $, means losses of full-time jobs, decimating the manufacturing industry.
It's just a matter of time, before we find out the 'price' of today's short term economic gains.

(Fri Aug 08 1997 08:32)
@S+P futures
S+P futures down 10.25 and long bond down 26 ticks

(Fri Aug 08 1997 08:36)
Andy Smith
The count is TWO STRIKES, no balls, two-out, bottom of the ninth, Andy baby,
``It's not Machiavelli, it's Murphy,'' offered precious metals analyst Andy Smith of UBS in London, one of the few analysts who
does not subscribe to the dwindling stockpiles theory.

``What can go wrong has gone wrong. With the bureaucratic and political problems, the by-product has been disrupted

(Fri Aug 08 1997 08:40)
Cherokee - Agree that China is increasing its capabilities with its numerous silent partners. The introduction of extremely high/hyper- velocity anti-ship missiles and/or coupled with a low RCS weapon would be deadly to its adversary fleets ( whomever that might be. ) The Silkworm missile is just a tinker toy compared to what they have now. However, to say that Sadam rolled over because someone wanted to observe the U.S. military capability is rather an implausible conspiracy theory. Schwartzkopf was lauded a hero for routing the Iraqis. Don Knots on his worse day could have defeated those clowns with the firepower the U.S. was allowed to build up in that area months before the massacre was initiated. It is unlikely that in any future flare up the U.S. will have the luxury of months of buildup time of personnel and materiel. The backbone of U.S. projection of power remains the carrier battle group. If that capability is taken out of the battle zone early in a conflict, the U.S. might have to resort to some of its "special weapons" or else seek a truce. But, as Ive said here before, the likelihood of this type of scenario happening in the near future is nil. The wildcards remain - escalating violence among the middle east players seems the biggest cause for concern at the moment.

(Fri Aug 08 1997 08:41)
S+P futures down 11.20.....11.30...

(Fri Aug 08 1997 08:42)

(Fri Aug 08 1997 08:44)
heading to work
Bob A: I don't know about political resolve. I hire vets and am very impressed with the folks we train and send into harms way. Our "stuff" is much better than the anti-military press will admit. Am unashamedly a flag waver. gotta go to work. S&P futures are going south fast! Could be an interesting day for gold. BYE!

(Fri Aug 08 1997 08:47)
Does anyone know how to shout SELL! in Greek? All Europe down, four exchanges down more than 2%. Keep knocking on wood. And, the best part is that no one seems to know why. That is a signal of market exhaustion. I would rather that we were in an oversold mode as per the comments of Gene Inger.

(Fri Aug 08 1997 08:48)
"talkin heads" say a statement by fed official Susan Phillips about wage pressure is behind large drop ( 28 ticks ) in long bond and big decline in S+P futures...Could be an interesting day folks five minutes London market is down another 25 points! down 73....pound crashin!

(Fri Aug 08 1997 08:50)
Whilst the west try to penetrate their 'market' for economic gains...

(Fri Aug 08 1997 08:53)
Roebear - Might be less expensive and get better quality with the old ones. BTW, you can still get the "pre-banned" IMI ( Model A ) for around $1500. Model B's go for a little less.... Both are getting a little harder to find, tho. Mossberg and UZI as partners - I can still hardly believe it! The hand guns they've been hawking recently have a hefty price tag....

(Fri Aug 08 1997 08:55)
Re: china???
china???: Good post. What makes it so sad to me is many of our largest corporations willingly give china our latest technology. China demands the latest technology transfer as a quid pro quo for the use of their slave and quasi-slave labor. Technology that took generations and hundreds of billions of us taxpayer and corporate profits to develop is given gratis or almost. Perhaps they KNOW we MUST import their cheap labor or the game is over for us.

(Fri Aug 08 1997 08:56)
Re-market turmoil: EBN gold quickly @ up 1.10....The sun is out and it's getting close to seakayaking time....

(Fri Aug 08 1997 08:57)
It sounds like China is being very 'active' and 'disruptive'. We have to keep in mind the 'source' of these postings. Do they want us to know?

(Fri Aug 08 1997 08:58)
TED -- Something coming your way. It looks like the word for today is UGLY. I mean equities = UGLY. Perhaps nobody wants to buy T-Bonds anymore? Globex does look UGLY!

(Fri Aug 08 1997 09:03)
Yeah, it's lookin grim ain't it....probabaly should have sold NES"talkin heads" sayin if S+P futures stay where they are,we're lookin at a 100 point down opening for the Dow..S+P futures down 10.25...

(Fri Aug 08 1997 09:05)
For the last 2 days, I have not been able to connect to any of the CNN news sites, anyone else having this problem.

(Fri Aug 08 1997 09:05)
Comex: Gold up 1.30;Silver @ unch; and PL up 10.40...

(Fri Aug 08 1997 09:06)
TED -- I got the Long Bond @ 6.567% UP 4.8 basis points so far today.

(Fri Aug 08 1997 09:07)
Minister visit eases
Jakarta's sharp fall

(Fri Aug 08 1997 09:09)
Malaysia's main stock index fell 2.46 per cent
yesterday on significant foreign selling amid a fall in
foreign exchange reserves, dealers said.

(Fri Aug 08 1997 09:14)
Panda: doesn't look like we'll hit 6% this futures down 10.40

(Fri Aug 08 1997 09:16)
Good afternoon JIN!...What the hell is happening to your stock market???
Where is THAT money going??

(Fri Aug 08 1997 09:18)
I'm outta nice to be inside!...BBL gold buggers...

(Fri Aug 08 1997 09:21)
A couple a news items;

South Africa
JOHGOLD JOHAN ALL GOLD INDEX 967.10 +10.10 +1.06% 8/7

From Bloomberg News;

Deutsche Mark's Fall Stings Germans' Pride -- and Pocketbooks By Renee S. Cordes Frankfurt: Matthias Steudter would rather be running, bicycling and swimming this month at a triathlon in Hawaii. Instead, the Frankfurt bicycle messenger is
navigating traffic in Germany's financial center. The culprit is the usually robust deutsche mark, the linchpin currency of post-war Europe, whose 18 percent plunge against the dollar this year has prompted comparisons with the swooning Thai baht
while making U.S. trips ``verboten'' for many Germans. ``Everything has gotten so expensive,'' said Steudter, who won't be going to Hawaii for the first summer in three years. Economists cite a myriad of reasons for the mark's slump, though they mostly boil down to Germany's weak economic performance when compared to that of the U.S. Published 11:38

(Fri Aug 08 1997 09:21)
Does anybody know where I can get Comex gold futures Open interest,daily
Thank you

(Fri Aug 08 1997 09:23)
Go to go and do 'stuff'. :- ( BBML

John Disney
(Fri Aug 08 1997 09:33)
For George Cole
RSA golds index up 3% so far - Wstn Deeps at 115 from
105 this am. Impala at 55 from 51 yesterday. I really
enjoy it when it goes like this. Now if gold would just
break a moving average of note. Happy days.

(Fri Aug 08 1997 09:37)
@for kitcoites
LONDON, Aug 8 ( Reuter ) - Precious metals held on to overnight gains on Friday morning but lacked signs of fresh buying to continue their rally, dealers said.

The platinum group metals ( PGMs ) were sharply higher despite the earlier-than-forecast arrival of Russia's contracted August shipments of platinum and palladium in Tokyo earlier on Friday.

Gold was fixed at $321.60 per ounce up 60 cents from Thursday's afternoon fix and just under the close of $321.90/$322.40.

``Gold is looking a bit toppy at this level. It is meeting some selling at over $322.00,'' one dealer said.

It was still a market in which to sell rallies, he said.

Although the price was about $3.00 under its opening week level, producers were looking to lock-in forward prices at anything over $322.00, the dealer said.

The market was helped up in New York yesterday by a slight weakening in the dollar from its level over 1.88 marks earlier in the week, and a 71-point fall in the Dow to 8188 which effectively turned round the previous day's gains.

The outside bet for gold was that a break through $323 would pave the way to $328 but dealers emphasised that this would need on a short covering rally and that was not certain.

Gold's short dated forward borrowing rates have been rising steadily this week suggesting either that more short positions have been opened or that producers have been borrowing metal to sell forward to lock in prices -- or both.

``Open interest is still high on the ( Comex futures ) exchange although yesterday's rally might have involved light short covering by the hedge funds,'' one dealer said.

Japanese trade house officials said Russia delivered its contacted platinum and palladium for August on Friday but prices rose on short covering by private investors in Tokyo.

Platinum was at $438.00/$441.00 up $4.00 but down about $21.00 from midweek levels and palladium was quoted at $229.00/$232.00 up $13 and $16.50 off the midweek high.

``Technically the moves are not unreasonable. The prices have retraced to a mid-point which suggests the ranges could begin to narrow,'' one dealer said.

A strike at South Africa's Impala Platinum Holding's refinery was also supporting the price although output was not being affected, dealers said.

Silver was down a cent at $4.37/$4.39.

06:31 08-08-97

(Fri Aug 08 1997 10:16)
Goldy try this disneyland...not the summer...oh God help me...I'm fulfilling wishes...that's good Karma...right?


good weekend all!

(Fri Aug 08 1997 10:18)
Greenspan the accountant
To All:

Very unusual, our Federal Reserve Chairman writes a letter to the
Financial Accounting Standards Board asking them not to
implement new accounting standards for derivatives.

Our Chairman does not want companies to be forced to record
their losses gambling in derivatives games. Why? The losses will
be substantial and will reduce or eliminate profits which will, when
reported, burst the stock market bubble.

Agree or disagee?

(Fri Aug 08 1997 10:20)
Links to all Senate Testimony on Y2K without downloading
Donald: use the following links to get all Senate Banking Testimonies
on Y2K in financial systems:

You have to read between the lines. I work with some "all mighty"
agencies on Y2K issues and see what is really going on. Testimony on the
Hill, does not say in clear language what is the real progress. Remember
that all testimonies are carefully prepared by lawyers and spin masters
to make it look as positive as possible.

George Cole
(Fri Aug 08 1997 10:25)
With the SA golds now joining the upward parade, I would place the odds that the lows have been seen at about 80%. As i have said repeatedly in the past, all genuine gold bulls must have strong SA participation.

Sounds like some of Andy Smith's clients are losing big money in the whites, Wait till they start losing big in the yellow! Wonder how much longer he will be able to keep his job. .

(Fri Aug 08 1997 10:28)
All & GSCole

It's official gentlemen :

The award for "KING OF KITCO" goes to


for the week of August 8,1997 's call for the DOW to RIP at 8300 !

Given willingly ( since that takes the pressure to perform off our backs ) by Earl and David ( formerly Front )

Congratulations George !


ps the last 2 David postings were not mine, Good, I agree, but not mine.

(Fri Aug 08 1997 10:35)
Y2K - Long-term investment implications
Miro et al: I have read all I can find on Y2K. I know software. My studied conclusion is that the odds of Y2K being a staggering economic event ( let's define "staggering" very arbitrarily as "assessed in 20-20 hindsight as having caused a 10% drop in the Dow" ) are about 1 in 5. Now we know of course that billions will be spent on it. But those billions are being digested even now without too much fallout. What can you tell me as a long-term investor that I might not know that would change my expectation?

George S. Cole
(Fri Aug 08 1997 10:38)
stock market
Thanks David! I am still not 100% sure the market has peaked, but the odds look pretty good now. If the next rally does not make a new high, then we can be 99% certain the top is in.

Mic Jagger
(Fri Aug 08 1997 10:41)
Should I place me pounds in RSA gold?
John Disney - Wouldn't you agree that the track record of African decolonialization suggests that all of RSA needs to be praying desperately for a continuing miracle in that fair land in the coming ten to twenty years?

(Fri Aug 08 1997 10:57)
Right On!!
David -- Hear, Hear! King George the Gilded.

(Fri Aug 08 1997 10:59)
@Pearl Harbor
Speed: Not to praise the thug-overlords who currently rule China, but to discount their ability to clobber the US Fleet in battle is foolish - you had better remember the Falkland Islands war - "inept" Argentina destroyed many top of the line British ships with low-tech iron bombs. And had Argentina many more French Exocets, the British fleet would be at the bottom of the South Atlantic. I would be scared badly by the prospect of a herd of sea-skimming mach 3 missles converging my fleet. If I were China, trading 40 Exocet firing "brown water" missile boats for a few Aegis cruisers or aircraft carrier would be a great bargain. I don't think the self-defense Phalanx guns could take down ten or twenty simultaneous sea-skiming missiles - a few maybe, then you just watch the remaining ones rip your billion dollar aircraft carrier apart. Our ships survive by keeping way-away from such threats. As for the coward-thug-creep Saddam, you are right about him allowing the US to build up forces prior to the US attack. He should have rained Scuds down on the Saudi ports from Day 1 to prevent US troops/supplies landing.

There are so many wars waiting to happen, we are going to have our hands full:
1 ) Iran vs Saudi Arabia
2 ) Pakistan vs India
3 ) China vs. Taiwan
4 ) North Korea vs South Korea
5 ) Israel vs. Syria

The only one that really matters is the Middle East. I expect that is why we left that coward-butcher Saddam in power: Iraq will take the brunt of the initial Iranian war surge, while US forces get ready. I can't see how the US will let the oil supply be interdicted. Taiwan, I expect, we have pretty much "sold" to the Chinese.


(Fri Aug 08 1997 11:03)
2- I only wish the sheep saw a 10% decline as staggering. They see it as a buying opportunity. In that case Y2K will be a net positive!

(Fri Aug 08 1997 11:08)
Your post grasps well the extreme fragility of the world military situation. Is solid Ada code the answer?

George cole
(Fri Aug 08 1997 11:15)
Mixed volume in XAU "heavies" today. PDG and NEM high; ABX and HM low. We need to see high upside volume in all these issues for several consecutive days before we can be reasonably sure sure a new gold bull has begun.

(Fri Aug 08 1997 11:16)
To Goldy
try this

(Fri Aug 08 1997 11:18)
CHEROKEE: You might be interested in this...I've heard Bible scholars claim that the "Kings of the East" that will invade Israel, is comprised of a China/Persia ( aka Iraq/Iran ) confederacy.

(Fri Aug 08 1997 11:35)

(Fri Aug 08 1997 11:38)
Dow/Gold Ratio 24.60. One ounce cheaper than the other day and starting to look a little "spikey" ( knock on wood )

(Fri Aug 08 1997 11:40)
August 8, 1997

Thailand Warns Over Economic Rumors

Filed at 10:05 a.m. EDT

By The Associated Press

BANGKOK, Thailand ( AP ) -- Thai authorities threatened Friday to punish people spreading rumors that the prime minister would resign
in response to a worsening economic crisis.

The threats by Interior Ministry officials came a day after state-owned media outlets were asked to stop undermining national stability by
reporting rumors of a looming military coup or the resignation of Prime Minister Chavalit Yongchaiyudh.

The warnings underscored the government's desperation to keep a lid on a potential public panic and runs on deposits stemming from a
rescue package from the International Monetary Fund as the country copes with its worst economic crisis in 15 years.

Chavalit had an audience to brief the country's revered monarch, King Bhumibol Adulyadej, on the economic situation Thursday that
triggered rumors he would be asked to step down, causing the stock market to rally.

The Stock Exchange of Thailand index closed down 1.18 points Friday to 637.90 after the rumors proved false. But the currency, the
baht, strengthened to 30.25 against the U.S. dollar from 31.15 amid lingering anticipation of a new government.

``We know where the rumor is from and who released it and what they want to do,'' Interior Minister Snoh Thienthong told reporters
Friday. His aides promised unspecified action against them. No one was identified.

Meanwhile, the government guaranteed deposits at remaining banks and finance companies in case the economy keeps stumbling despite
the IMF bailout, expected to total $15 billion to $18 billion.

The guarantee is aimed at stopping a run on deposits following the closure of 42 finance companies Tuesday under the IMF deal.

Coupled with the closure of 16 finance companies earlier this year, the move has caused to Thais to withdraw their money from the
remaining 33 finance companies and 15 commercial banks. Many have been furiously transferring funds to foreign banks.

The guarantee, pledged by Siri Ganjarerndee, an assistant central bank governor, said depositors at surviving institutions would be repaid
their funds instantly if one fails.

``We feel uncomfortable to see that much of the public's deposits have been transferred to foreign banks,'' Siri said. ``If people keep
withdrawing money from these institutions, the healthy companies will become unstable.''

After a decade-long, export-driven boom where average annual growth stood above 8 percent, Thailand's bubble burst in 1996.

Export growth fell to zero and the financial sector veered toward insolvency as companies that lent heavily to property firms ended up
holding dud loans when a glut of space could not be sold.

Speculative attacks against the baht forced a flotation July 2 that shaved 20 percent off its value against the U.S. dollar.

The baht's troubles triggered speculation against other Southeast Asian currencies, and the region hopes the IMF package can sort out
Thailand's mess before it spreads.

Calls mounted this week for Chavalit, a former supreme military commander with little economics experience, to resign.

Chavalit's nine-month-old coalition government has failed to meet promises to stem the economic crisis. Many Thais see turning from
Chavalit to the IMF as their last hope, but others are angry to surrender economic sovereignty.

(Fri Aug 08 1997 11:40)
Re: Bernie, losses
Bernie: Agree losses must stay hidden. Its amazing to me how long this game can be run. I have been watching for thirty or so years as losses of all flavors are capitalized and added to the evergrowing debt load.

(Fri Aug 08 1997 11:41)
Treasury Bonds
Feds...calling Hashimoto...ding...ding...
He doesn't appear to answer...

Treasury bonds staggered lower Friday morning as weakness in overseas bourses spread to the U.S. market. Catalysts in the
decline are worries over next week's economic reports as well as dealer selling of a surplus of newly-issued Treasury securities.

Next week's economic docket includes data on consumer and producer price inflation, retail sales, and industrial production.
Given recent strength in auto sales, in addition to the pick-up in sales at major retailers, some market participants are worried
that the upcoming data will come in above expectations.

Further, primary dealers of government securities are sitting on a mountain of 10- and 30-year Treasury bonds that they had
trouble selling to customers in this week's quarterly refunding.

(Fri Aug 08 1997 11:47)
Dow in trouble????

(Fri Aug 08 1997 11:48)
XAU chart...

(Fri Aug 08 1997 11:50)
HUI chart...

(Fri Aug 08 1997 11:54)
@What a difference a week or two can make!
Long Bond over the last few days...

(Fri Aug 08 1997 11:54)
death to C++!
To 2: ( chuckle ) And people think the Y2K situation is a problem - wait until all those gaggles of C/C++ code start needing modification! Ever tried to maintain C++ code written by someone enamoured of language complexity? Unreal. The real cost of software is in MAINTENANCE, as the Y2K problem indicates. C/C++ programmers tend to write dense, illiterate, hard to understand and unmaintainable code. Ada was designed with all the cold, hard lessons of past language failures in mind. It is the ultimate pity that C++ has triumphed over Ada due to the simple fact that Ada *forces* you write correct code - this "threatens" the "freedom" of C/C++ programmers. When it comes to software that you entrust lives to, "freedom" of code design is not a big concern.

I try to fly in Boeing aircraft when I travel - as they use Ada for flight safety critical software. The thought of losey-goosey C/C++ written by the herds of ill-trained hackers and C programmers is terrifying.


(Fri Aug 08 1997 12:02)
Eldorado -

Re your post a couple of hours ago, the orthodox Elliott wave view is that gold is doing an A-B-C rally whereby the first leg went up to $330 aprox., then down to $318 and then the third and final 'c' wave to $330 again ( give or take a few $ ) before she heads down to $300 or lower on last leg down before major rally. If it is a 'flat' correction it won't go above the previous $330 high.

There are two arguments against this scenario: 1 ) the gold shares are pulling upward strongly and are generally a good lead indicator ( thank you, Mr. Cole ) and b ) the weekly stochastic for gold has given a buy signal. Again, as George Cole has said, if the price breaks above $332 it is bullish. I'll be buying on the other side of it.

(Fri Aug 08 1997 12:11)
Disillusioned (nothing to do with gold)
A few weeks ago someone posted a great commencement address that Kurt Vonnegut was purported to have given to graduating class at MIT. Turns out it was a big internet hoax. Vonnegut has never given a commencement address at MIT. The woman who actually wrote the address did so while "high on coffee and M&M's." Additionally, Vonnegut absolutely hates the internet! Read about it at ( you may have to register, but it's free )

(Fri Aug 08 1997 12:27)
Spudmaster- I welcome your comments about C++. I thought I was the only one who thought 'compact' code was dangerous. Do you think the Y2K problem extends to C++ programs? I don't know why not, but I've not seen any references yet. By the way, what is Ada?

(Fri Aug 08 1997 12:39)
I repeat the kitco discussion entry, below, that I entered/shared, yesterday, Aug. 7th. This is the resumption of the bull market in precious metals, which, for this decade, began in late '92, first quarter of '93. This is not an "Elliot Wave' bear market rally, for gold, or silver.... ( dear Elliot is surely turning in his grave ) . This is a new bull-market chapter, for gold & silver investments, just beginning. It is one of those rare times when an investor can throw caution to the wind, and go 'long', on precious metals investments. Here is my kitco discussion, from Aug. 7th:
Date: Thu Aug 07 1997 18:48
David ( ) :
""Reason Returns, Just In Time""

Is the U.S. Bond market encountering "indigestion" ?
Is the U.S. Dollar @ 'exhaustion' ?
Is the S&P approaching it ?
Did the Comex Aug. gold contract close @ a new low, yesterday, while Silver, the Xau,
Platinum, Paladium ... did not? ... And thus did not confirm the recent downtrend; but
instead, signal a change in trend, and a new bull-chapter, for gold & silver related
investments ... ( ? ) .

Who was it who said: "Pride goeth before the fall." ...?
( from Inv. Business Daily, 8/7/97, p. B1: )
"Fed Critics Cancel Meeting"
"The Fed and its policy-setting Federal Open Market Committee are doing such a good job
that the gadfly Shadow Open Market Committee has decided to cancel its usual September
meeting, the SOMC's leader announced. The Shadow group of monetary-oriented
economists has met every six months since September 1973 ( ! ) . But its chairman, Allan
Meltzer, states in an Aug. 1 letter: 'Currently we see no reason to meet.' "
Now, isn't this curious; sort of like: 'as Nero fiddles, Rome burns'. Isn't it even more curious
that when the economy is going all to hell ( --as it will be, again, and soon ) ; everyone has
someone to blame. And when the economy is growing, or appears to be so; eager voices
abound to take credit for it, &/or pat one another on the back -- for the feigned credit due,
and/or otherwise, willingly look the other way.

So, as 'mother-nature', pushed once more to the limit, loses patience with our folly, one more
time; reason will return, but only with considerable surprise, and pain, once again. Markets
out of balance, out of 'rhyme' with reality, will correct themselves, in this time.

(Fri Aug 08 1997 12:40)
Airline crashes have been much in the news lately. Airline profits are running at record highs. Perhaps some of these profits could be ploughed into airliner maintainence? Perhaps a few bucks could also go to fixing their glide path system on Gaum. Didnt know it was down? Our "free press" seems to to passing this fact by. One other thing we have not been maintaining for fifty or so years, our money. When it crashes it will be as if all the airliners in the world attempted a simultaneous landing at the Lima Ohio airport.

(Fri Aug 08 1997 12:42)
off to the shore
Wow, gold is up; the dow and S&P are down big time.
Time to take my buns to the beach and celebrate.

(Fri Aug 08 1997 12:48)
_REALLY_ Disillusioned!
Bush-Dole Ticket in year 2000!!!???

(Fri Aug 08 1997 12:50)
EBN gold up $4.40. HMMMM... XAU up 4.67% HUI up 2.44%

(Fri Aug 08 1997 12:54)
C++ problem
WFN: ref. Y2K problem - I can't speak for ancient COBOL code ( I'd rather have no-caffine tea with Jane Fonda & listen to politcally correct rantings first ) - but I can say that from the code I've seen & software short-cuts taken, modification of C & C++ code will be painful. Another concern is the databases these systems use - many have allocated the usual two digits for the year, so not only must the code be corrected, but also the data model for the database reworked. The "problem" is bigger than simple code changes. On the otherhand, with the hype on the news, any manager that hasn't already started the process to fix the problem in his system will be toast. I can just hear some useless CEO screaming: "...WHY HAVEN'T YOU STARTED THE CORRECTIVE EFFORT!!!"

Ada is a programming language mandated by the US DoD for software - or was until they recently wimped out. Ada is a language with roots in Pascal and Modula-2. There practically no ambiguity in the Ada language. If you write an Ada program, any Ada compiler will compile it, and an Ada programmer can understand it. Compare with C/C++ languages - for which there are a multitude of standards, version, each with their own quirks. And that doesn't even say anything about the C/C++ languages - which facilitate writing of poor code. Time will tell.

Obligatory gold comment: Buy gold.


(Fri Aug 08 1997 12:58)
A lovely bluebird on the sill
Sorry to post in the middle of the day when all of you who know so much more about things are posting such wonderful thoughts. My dear friend Esther Harrison who gets on the Web at the library in Cedar Rapids every Tuesday when she goes in to vist her sister Amelia just loves Mr. Cole. I've just given her a call and I just wanted everyone to know that she is so excited about Mr. Cole's prediction on the Dow top.

Eveeryone have a wonderful weekend, and I'm going to put out some more suet for that bluebird and his friends, then we're heading down to Lou's brother's place in Prairie Hill just until Saturday evening.

Who Cares?
(Fri Aug 08 1997 12:59)

Ada is a DOD invention. It's original purpose was to provide
a common programming language for all government projects.

It's a direct refutation of the idea of specific tools, i.e
the "one size fits all" mentality, hence it's failure to
accomplish its original mission.

It has found a niche in real-time systems that require high

Question - if my base operating system is written in C++, how
do I benefit from using Ada for the application? : )

(Fri Aug 08 1997 13:03)
Enough Guts!

Agree with your assessment.

I hope the CPA's have enough guts to stand up to the Chairman
and tell him losses must be disclosed to shareholders. In fact I
think I will send them a fax.

(Fri Aug 08 1997 13:08)
@the scene
EBN up 5.10! Could be 330 Dec won't stop the runup!

(Fri Aug 08 1997 13:09)
down for the count?
High upside volume and strong gains in ALL XAU heavies. Bullion surging. Stocks plunging. SA golds surging. Looks like the gold bears and stock bulls ARE DOWN FOR THE COUNT.

The martians are going to massacre Andy Smith and his minions.

Who Cares?
(Fri Aug 08 1997 13:11)
Ada Revisited

Sorry, my sense can't let THIS one pass -

:Ada is a programming language mandated by the US DoD for software - or :was until they recently wimped out.

Because it couldn't accomplish the mission as well
as other tools. : )

Don't buy Ada stock. : )

:Ada is a language with roots in Pascal and Modula-2. There practically :no ambiguity in the Ada language. If you write an Ada program, any Ada :compiler will compile it, and an Ada programmer can understand it.

Delphi is a language with roots in Pascal and Modula-2. There is
practically no ambiguity in the Object Pascal language. If you
write an Object Pascal program, any Object Pascal compiler will
compile it, and any Object Pascal programmer can understand it. : )

However, you don't see nobody rushing to use Object Pascal,
because, despite its significant reliability advantage over
C++, it's a niche market. To paraphrase Hepcat - the cost of
producion is major cost driver. : )

Sorry, I just have to quibble. The "ambiguity" of C++ is
an ADVANTAGE, say its supporters. : )

: quirks. And that doesn't even say anything about the C/C++ languages - : which facilitate writing of poor code.

The same is true of Cobol, the true scourge of Y2K.

For the record, I say it's an overblown problem. : )

(Fri Aug 08 1997 13:14)
We might be testing THE CIRCUIT BREAKERS today! TICK = -1493 TRIN 1.430 SPX = -25.31 TYX up 12.9 basis points @ 6.648%

(Fri Aug 08 1997 13:15)
Who cares? You & everyone whose lives depend on software :)
Who Cares: To answer your questions, I have yet to see an application that could not be practically and easily written in Ada, from real-time to brain-dead business apps. Face it, C/C++ programmers are mustly lazy. Rigor is not a word in their vocabulary.

With respect to an OS written in C++, running Ada apps - at least the Ada WON'T be a problem ; ) Unix - a soon to be dead OS, victim of Windows NT.


(Fri Aug 08 1997 13:15)
Dow/Gold Ratio 24.14 ( knock on wood )

(Fri Aug 08 1997 13:17)
DOW crash & burn today?
Anyone care to comment on the DOW ( currently down 200+ points ) causing a NYSE market closure today?

(Fri Aug 08 1997 13:21)
At long last?
Is this the day we have awaited? August 8, 1997: Beginning of the gold bull. What do you say we on the bus and enjoy the ride together, Kitcoites.

I told you:
(Fri Aug 08 1997 13:31)
US Treasury buying spoos as soon as dow down 200

(Fri Aug 08 1997 13:36)
Spudmaster: We ain't the British. Our aircraft don't curtsey. Exocet missles have top range of 30 miles and have to be locked on by the firing platform.. The US harpoon has a range of 80 miles, guides itself in and every ship and most planes have 'em. We use SM-2s against Exocet type attacks and the Aegis class cruiser carries 100. All 100 can be fired in under 5 minutes. Your scenario sinks all Chinese ships and shoots down all Chinese missles with only one cruiser, not counting CAP from the carrier or the missle complement from the destroyer in the group. Don't forget the subs traveling with the BG. Don't forget the T-LAM ( A-D ) . More later. Go gold.

(Fri Aug 08 1997 13:48)
up, up & away

(Fri Aug 08 1997 13:48)
Fidelity Gold funds update as of 1:00pm EDT:

FSAGX = $20.51 up .39 ( 1.94% )
FDPMX = $13.73 up .23 ( 1.70% )

Who Cares?
(Fri Aug 08 1997 13:48)
Ada Redux

Lazy programmers - Only the old ones. My students have been doing
OO programming for the past several days. : )

Unix is dead - what's your point? : ) Now we have Windows NT,
written in.... C++. : ) I have ALREADY incurred the RISK of
"poor C++ programmers", have I not? : ) Surely I should reap the
benefits of cheaper costs. : )

And *my* life rarely depends on software. : ) Ada is relegated to
aircraft control, possibly command & control of the upcoming
high speed trains, nuclear power plants, and M-1 tanks. : ) I
rarely use any of these. : )

Sorry, I can't help it, I'm getting laugh out of this. I
absolutely love Delphi ( also a OO derivative of Pascal, like Ada ) ,
but it was crappy career move. : )

Obligatory gold comment - likewise, buy gold. : ) Not because
of shorts, trends, Y2K, Cobol or Ada, but because governments
have made promises that can NOT be met. Inflation, deflation,
who cares? They're both acknowledgements that paper has been
issued that is worthless. In one, inflation, everybody is
punished equally, while under deflation, reckless lenders and
borrowers are punished.

(Fri Aug 08 1997 13:57)
Martians Revolt!
Does anyone have a clue why gold is surging and the dow is tanking?? Is there any news ahead of this move?? ( There certainly will be following this... ) What gets me a little twitchy is bullish action on ALL the gold stocks in the indexes. Makes you wonder what is in the wind.

A very simple possibility would be all the major producers deciding to close their hedges with currently cheap bullion and lock in their profits.

Another possiblity is that there is a major transition between financial assets now under way. Someone posted a while ago that bullion and gold stocks USUALLY started major rises in the last phase of a bull market EXCEPT for times when there was a major transition between asset classes such as in 73/74 when you got more symetrical market action ( gold going up at exactly the same time stocks are tanking ) . Perhaps this is what may be unfolding.

Finally, there may also be some type of geopolitical unpleasantness about to unfold.

Very interesting to watch though. :- )

(Fri Aug 08 1997 14:10)
TO TED......

(Fri Aug 08 1997 14:17)
Hi Nailz: Just got back online...good day for my damn ISP to shut down for four hours...XAU up 3.37 but was higher...still not a bad!..
looks like the "dipsters" are tryin to do their thing and Dow only down 140....Long Bond gettin slaughtered!

(Fri Aug 08 1997 14:22)
PM History
With the exception of the spike in PL to 500, all PM have moved in well defined channels since roughly February this year. I think you will find this chart interesting.

Let's see if today's action changes things.

(Fri Aug 08 1997 14:23)
3-2-5. He is right again. This time going the other way.

(Fri Aug 08 1997 14:24)
In war, technology doesn't always produce expected results. I do not expect our technology to work ( shoot down incoming ) entirely and I therefore expect losses, perhaps a big carrier. The question is really what will our great leader do if a few thousand sailors go down? Would we respond by bombing the mainland, or just say we made a mistake, sorry. Please don't bomb Disneyland.

If the U.S. should lose a big battle ( or just a major carrier ) such as this, the dollar would crash, and gold measured in dollars would skyrocket. U.S. debt would be unfundable and our financial house would be in big trouble. Our leaders know this ( Clinton, Rubin ) and therefore will not risk it. In other words, let Taiwan fight its own battles.

What would Taiwan do? Will they resist an invasion? I suspect they would eliminate most of an invading Red Air Force similar to the Battle of Britain. Then what? Would the rest of the world just watch? ( probably )

In any case, the Chinese would have to be crazy unless they felt they could bluff the mighty U.S. I don't rule that out with our present administration.

(Fri Aug 08 1997 14:30)
The surging trade surplus for Japan certainly put a damper on the U.S. Dollar...down 3.73 @ 114.70 ....If this is the start of a trend it'll definently help gold....Dow down 116...for trading to be halted the Dow has to be down 350 so we didn't even get close....YET...Where's Tort??

(Fri Aug 08 1997 14:31)
Y2K - Long-term investment implications
2: I think that your odds of 1 in 5 for Y2K being a staggering economic
event causing a 10% drop in the Dow are underestimated. It is not so
much the cost of fixing the problem in individual companies, though
this is an issue by itself. I don't want to drag a software discussion
to the gold forum, at the end of the post I'll just make a comment to a
few posts related ADA, C++, COBOL.

1. In this era of global economy, networking, EDI, and high
dependency on technology, correcting your in-house system is not
enough. Problem is worldwide, and if somebody else fails it will impact
your company somehow.
2. It's not so much in-house software but a global communication,
exchange of information, "electronic cash". Choke that and today's
economy will stop functioning.
3. Difference between spending on IT and spending on Y2K is that
non-Y2K spending is suppose to boost your productivity, Y2K
spending does not give you any new functionality or increase of
4. Y2K will take a bite from other high tech technology spending and
this will have an impact on high tech company earnings ( see the recent
announcement of MS about demand going flat )
5. There will be a significant money wasted on litigation. As of last
week there was the first ground breaking law suite where a local
grocery chain sued the company which developed their system ( system
is not accepting credit cards with expiration date pass 2000, system is
crashing, and the store is loosing business ) .
6. The cost of litigation is estimated at $1 trillion. The money spent
on litigation will not help production but it will sure push expenses up
and profit down. Law suits will not stop at system providers, companies
will sue their suppliers, and vice versa. Few companies will shut down
due to Y2K related litigation.
7. Next year you will start seeing Disclosure of Y2K risks to
shareholders and investors. Wall Street is still does not have a clue but
when they start reading about I,t not in media but in SEC filing and
company annual reports, they will act.
8. Consider "Joe homeowner" who acts not on the knowledge but on
tabloid news. As we get closer to the Year 2000, journalists hungry for
stories will have their lunch and public will act ( just like now when
they move money into MF because everybody say that's what they should
do )

I expect much more significant disruption than the one with 10% drop
in market. I would vote more like 30%. I think thiw will be a good
news for gold!

Discussion on ADA, C++, COBOL:. It's not the language. We go
through the code for all of them and none is in better shape than the
other. Software developed in "old" languages was patched over and
over, new software is developed through misuse of engineering
principles ( and yes, hacking ) . We just assessed a system developed in
"modern" client-server environment sitting on relational database, using
object oriented front end. System is still in development, not in a
production yet, and it has Y2K problems written all over it. If not
fixed it will fail badly. Correcting it will take more than "old
fashioned language" because the combination of object oriented
environment, misuse of it, combination of multiple technologies in
client-server is much worse than a monolithic COBOL application on

(Fri Aug 08 1997 14:34)
To David...

I asked nice ... you refused ...

By your continuing to use David instead of obliging, obviously you want to keep the name David as your handle


I'm back to Front

(Fri Aug 08 1997 14:35)
gold market up
GFD... The worldwide markets recognized that the 30 year bond refunding yesterday was bought almost entirely by investment houses and very little retailing to investors. The 30 year bond rate went up, the dollar went down before NYSE opened. Gold was up slightly in London early and S. African stocks were up. Because the stage has been set since early July, most of us like George Cole were waiting for the Treasury refunding to spring a leak. This could be it, coinciding with the rest of the world agreeing.

Now, is that high speed ship heading this way loaded with missiles, friend or foe?

(Fri Aug 08 1997 14:37)
Panda: your missive just floated in as my ISP picked today to shut down for most of the day...Your experience of yesterday is very interesting especially considering today's action in gold and gold tea leaves to consume!...Not familar with Regal as my firm is in yer neck of the woods ( Fidelity ) gradually fazing em out as their service is going down the tubes....Good call this morning ( before the markets opened ) by Jimmy Rogers,shorting the long bond....

(Fri Aug 08 1997 14:39)
Welcome back!

(Fri Aug 08 1997 14:41)
Front - Better than being front to Back!

(Fri Aug 08 1997 14:42)
Speed: Don't overlook the fact that the British won their last war. If the Vietnamese join the Chinese well I hope they don't wear their pajamas and sandels this time.

(Fri Aug 08 1997 14:46)
XAU up 4.19....long bond down 1+ 31/32 with yield @ 6.64%....Dow down 109

Spud Master
(Fri Aug 08 1997 14:48)
tapirs, and rumors of tapirs...
Larryn: I agree with you about our "weak knees" Commander in Chief vs. a Chinese sinking of a US capital ship. We are so bleeding prostituted to incoming cash to buy our worth Treasury notes & keep the farce that is our happy, new economy going, God knows what kind of *ss-kissing rationalizations the CinC would make: "...well, our carrier Nimitz *was* in the way of their missile. I have directed Sec. State Albright to issue a formal appology and pay for the missile..."

As far as Taiwan doing a "Battle of Britian" number vs China ... I hope so, but remember the Mainland Chinese thug-war-lord-so-called-leaders wouldn't hesitate to start pounding Taiwan with their intermediate range ballistic missles ( D-21 ) with conventional warheads. Perhaps the Patriot batteries on Taiwan could stop enough of the missiles ... maybe not. Cost of a Patriot vs. cost of Chinese D-21 missile - attrition situation here. The D-21 is cheap ballistic missile, the Patriot is a very expensive guided missile. I would guess the mainland Chinese will naval blockade Taiwan while the rest of the world wrings it's hands and says "how awful!" & does nothing ala Ethiopia/League of Nations circa 1935. Hopefully Taiwan will bloody China so badly that Beijing thugs think twice about it. End result though, is that Taiwan will probably be bankrupted by the defense action. Meanwhile, we'll all keep buying slave-labor tennis shoes from China.


(Fri Aug 08 1997 14:57)
in sack-o-tomatoes
GVC, Nailz, Mooney: Thanks for the feedback re yesterday's 11:10 query about large volume trades. I definitely overlooked the way options tend to increase in value as the underlying commodity approaches the strike price. I wonder just how low the fund in question believes silver will go? In other words, when do they intend to go long: 4.50, 4.25, 4.00, 3.75, 3.50? $4.50 is too risky, as is 4.25. It shouldn't be a problem to work out just where the gamble makes sense, being careful to factor in the increasing value of the puts as silver falls. Once you have that number, you'll know how low they expect/hope silver ultimately to go. Suppose that number is $3.75. My question is: why in THE world would anyone expect $3.75? Not by reading the same industry news that I'm reading!

(Fri Aug 08 1997 15:10)
Hi Ted, been out of circulation today. I like what I see in the gold market today. I have one thing to say; its time to pull anchor and sail. I haven't had time to produce a joke today. I will do it before I leave the office today. Regarding the gold stock index---yeeee haaaaah

(Fri Aug 08 1997 15:15)
TED -- I was in my friendly local Schwabee office today. I asked them about that twenty two minute fill for a market order yesterday. The response was, "It was probably filled in a minute or less, your notification was just delayed." Funny thing is, that's not what the time stamps say.... You've all just been warned.

(Fri Aug 08 1997 15:15)
$330 tug of war
Will 'shorts' fold? They ran in August ( Dec rollover ) now what?

(Fri Aug 08 1997 15:18)
@327.75 EBN

(Fri Aug 08 1997 15:19)
What about the rumour that OPEC will demand gold for oil in case of Middle East conflict ?
I understand this idea was originally started in Saudia.

(Fri Aug 08 1997 15:20)
Who wants to be long Bonds or stocks this weekend????

(Fri Aug 08 1997 15:25)
Makes for a good read. This gets changed every hour or so.

Looks like a last minute rescue coming up, tick just went positive by better than 200...

(Fri Aug 08 1997 15:25)
Larryn: Thanks for the update. The leak in 30yr bonds did not register on my scope.

Does anyone have an opinion whether the *leak* represents buying exhaustion?

The next thing to watch will be monetization by the Fed if things start getting out of hand. Interestingly it may well be that the dow gets monetized as well as bonds given the Fed's apparently wider mandate. :- )

(Fri Aug 08 1997 15:27)
RON's 2000 PUTS
RON......Your guess of $3.75 as to where the fund would buy futures is probably close...I would guess 10-15 cents higher..Your question as to why would they expect it to go that low ??? It is the nature of the markets..When the bulls reign they push to the max...Same on the other end, when the bears reign, they push to the max...

(Fri Aug 08 1997 15:28)
Simple crap

Next time you buy something; and you don't like where it was manufactured -don't buy it-. Its that simple.
I HOPE that the former UBS, is soon forced back to her old roots. As for Andy Smith and Ted Arnold, my glee may be premature, but HAR HAR HAR, anyway.

(Fri Aug 08 1997 15:30)
Updated Dow chart;

(Fri Aug 08 1997 15:45)
Looks like a 'holding action' being fought around the 8050 to 8060 level. I guess we really don't want the Dow to close below 8000 for the weekend, now do we? :- )

(Fri Aug 08 1997 15:46)
China Syndrome
I have been enjoying all the recent - and well informed - posts on a hypothetical naval confrontation between China and the US.

Frankly, at the current time the Chinese would not stand a chance. Their air force is way, way too weak for anything serious. Secondly, the primary means of US naval engagement would be subsea. That is, they would use submarines combined with an agressive air and surface campaign against any serious Chinese ASW assets. Once the Chinese air force and ASW assets were dealt with the US would mine the harbours and the subs would sink anything that got through.

If you look at the US experience in WWII, it turns out that the subs ( once they got their stupid torpedoes to work!! ) were instrumental in bringing Japan down.

The Carriers would be way, way out of range of any land based cruise missiles and would be postitioned to protect Taiwan. While I tend to agree that you cannot expect 100% effectiveness against a large cruise missle attack, Chinese naval planners would have to be prepared to commit around 200 cruise missles in a combined attack to realistically have a chance to do serious damage to a US carrier. The only way they could do this at the current time would be by truck.

Spud Master
(Fri Aug 08 1997 15:59)
they are not going to send out invitations....
GFD: I doubt a US Carrier Group could stop 20 simultaneous, much less 200 , sea-skimming missiles, short of moving destroyers & cruisers into the path of the missiles in an awful hurry - ( destroyer bridge captain: "THEY WANT US TO DO WHAT?!" ) . It is unlikely the adversary will advertise their intent until the missiles are in the air. Just a nice, friendly, harmless Chinese tanker poking along the high seas until - surprise - it starts disgorging missiles. I can not think of any test or exercise in which 20 simultaneous sea-skimming missiles have been defeated. I'm sure the on-ship Phalanx guns would be blazing away ... too late. The best defense I read of ( some years back ) was to buy two used petroleum supertankers and have them cruise parallel to the expensive, tasty carrier as "cruise missile spunges".

Unlike the moronic Iraq High Command, who are experts at torturing children, but idiots at fighting a *REAL* war, the Chinese are not going to give us plenty of clues before they damn well do what they want. Likely we'll be staring gape-mouthed in shock, saying softly: "they can't do that. that's cheating..."


(Fri Aug 08 1997 16:00)
Panda--- What's your take on the technicals regarding the stock
markets behavior today?

(Fri Aug 08 1997 16:01)
From DBC news;


(Fri Aug 08 1997 16:02)
Walmart Unionizing?
In first for U.S., Wal-Mart workers voting on union

Copyright  1997
Copyright  1997 The Associated Press

MERRILL, Wis. ( August 8, 1997 12:58 p.m. EDT ) -- Lori Hermanson sees little significance in efforts to make her Wal-Mart
store the first in the country to unionize.

"I don't think of it as an historic feeling as much as everyone wants that vote to be done," Hermanson, an office clerk with seven
years at Wal-Mart, said Thursday. "It is kind of like a bad dream. We want it to go away."

But she and her colleagues are voting Friday on whether to join a union, the first time Wal-Mart workers in the United States
have done so. At stake is a dent in the company image of happy, blue-aproned workers known as "associates" in one big

"It pretty much seems business as usual," Charlyn Jarrells, Wal-Mart's labor relations manager, said in describing the mood at
the store. "The associates are fully aware of when their voting times are and when they can go up and exercise their right to

The night receiving crew voted between 5 and 6 a.m. at the polling site, the store's lay-away storage area, Jarrells said. Two
other shifts of voting are set -- between 10 a.m. and 2 p.m. and 6 p.m. to 8 p.m. In all, 94 workers are eligible to vote.

"We are going against their tradition because what they say and what they do don't coincide," said pro-union employee Becky
Hehling, a 25-year-old single mother of three who had a "Work with Dignity" button pinned on her blouse.

Union supporters say representation will help win higher wages and fairer treatment in getting raises, scheduling by seniority and
a formal procedure for settling grievances.

But Hermanson said she opposed unionizing, and Wal-Mart district manager Ray Mann believed the vote would fail.

There has been tension over the vote in this rolling river town of about 10,000 people some 160 miles north of Madison. It
carries inside the store sometimes.

Hehling said the store's co-manager even broke into tears at one meeting, saying to vote for the union was to vote against her.

"I offered her a tissue and she wouldn't even accept one," Hehling said.

Jeanette Krause, 36, shopping Thursday for school supplies for her six children, said Wal-Mart is the only discount retailer in
Merrill and her family does 99 percent of its shopping there.

She fears a union might change that.

"My concern is what is Wal-Mart going to do if they push them too far. Would prices go up or would they close the store?" she

The vote will be watched closely by giant retailers across the country, industry experts say.

"I suppose it could be taken to some degree as a line in the sand for the union movement, making a stronger thrust back into
business," said Wendy Liebmann, president of WSL Strategic Retail, a market and retail consulting firm in New York.

A unionized Wal-Mart store would cut at the heart of Wal-Mart tradition and culture, and open the door for union efforts at
other stores, she said.

Except for a store in Windsor, Ontario, Wal-Mart has defeated all unionization attempts since it was founded in Arkansas by
Sam Walton in 1962. It relies heavily on stock incentives to motivate its relatively low-paid work force.

Wal-Mart has 2,308 stores and 439 Sam's Club stores in the United States and seven foreign countries. Sales totaled $104.8
billion for the year that ended Jan. 31.

The Merrill Wal-Mart opened in 1989 and employs about 120 people, 60 percent full-time.

Store wages range from minimum wage to about $14 an hour, said Pat Schafer, an organizer for the United Steelworkers
Union, which sought the election being conducted by the National Labor Relations Board. Employees below the level of
supervisor make no more than about $8 per hour, he said.

In order for the NLRB to call an election on the union question, at least 30 percent of the workers in the proposed bargaining
unit must sign a petition requesting one.

Pizza Man
(Fri Aug 08 1997 16:04)
Sometimes Things Go Right!
Bob a: Good call predicting Gold up on Thursday. Kitco truly is a
great site. Mr. Gene Inger last 2 lettters at Gold Eage was on the money!
Short S&P today what a ride. Gold up to put icing on the cake.

(Fri Aug 08 1997 16:06)
Union calls for strike vote as newspaper changes ownership
Is it coincidence or a 'sign' of labor unrest?
Copyright  1997
Copyright  1997 Scripps-McClatchy Western

MONTEREY, Calif. ( August 8, 1997 12:28 p.m. EDT ) -- A new publisher of the Monterey County Herald was announced
Wednesday and the papers' employees union -- fearful a pending ownership change will mean job losses for its members --
called for a strike authorization vote.

Pat Keil, 40, senior vice president of sales marketing at St. Paul Pioneer Press will be the Herald' s publisher when
Knight-Ridder Inc. completes its acquisition of the paper later this month.

Keil was introduced by Knight-Ridder executives to about 150 Herald employees at a tense afternoon staff meeting that was
dominated by employee questions about the future of their jobs.

"I know it's an anxiety kind of day," Keil said.

Under a three-newspaper swap announced July 25, Knight-Ridder -- owner of the San Jose Mercury News and 34 other daily
newspapers -- is acquiring The Herald and the San Luis Obispo Telegram-Tribune from the E.W. Scripps Co. in exchange for
the Daily Camera in Boulder, Colo.

Keil and other Knight-Ridder officials told Herald employees that they will have to apply and interview for jobs at the paper,
along with other applicants, under the new ownership.

"Any employee who desires a job with The Herald will be given full consideration, fair consideration and a personal interview,"
Keil said.

Asked if current employees would be given hiring preference, she responded, "My plan is to hire the best person suited for the

One woman employee asked, "If I've done my job for 20 years ... why pick someone else?"

"I didn't say that was going to happen," Keil responded.

Knight-Ridder officials said Herald employees were mailed job applications and other information about the ownership change
yesterday. They said available jobs also would be advertised in regional newspapers and within the Knight-Ridder newspaper

"I'm personally puzzled why they are taking this route," said Russ Cain, a Herald photographer and representative of the San
Jose Newspaper Guild, which also represents Herald employees.

"They didn't have to do it this way," he said. "They aren't doing this in San Luis Obispo."

About 200 of 230 Herald employees are represented by the Newspaper Guild and two other unions -- the San Francisco Web
Pressmen and Prepress Workers, Local 4, and the Monterey Bay Area Typographical Union.

The unions' existing contracts with Scripps Howard are due to expire in June 1999, Cain said.

Knight-Ridder officials wouldn't say whether they would honor those contracts, saying it was too early in the ownership switch
and noting that the contracts are with Scripps-Howard, not Knight-Ridder.

"Until the hiring process is complete, I can't say what, or if, the obligation will be," Keil said.

Cain said Knight-Ridder's plans for hiring means "there are employees here that aren't going to be rehired."

The unions scheduled a 6 p.m. meeting Friday night in Monterey where members will be asked to authorize union leaders "to
call a strike if and when it's necessary," he said.

Union workers at The Herald took the same tack in 1992 when Scripps-Howard acquired the paper, he said, but they didn't
strike because the then-new owner agreed to honor the existing contracts.

Given employee reaction to Knight-Ridder's announced hiring policy, Cain said he expected easy approval of a
strike-authorization vote.

"That was an angry group in there," he said. "The only problem I have is having them wait until tomorrow night."

Knight-Ridder officials had no immediate reaction to the unions' move.

"It's a hard time. People are feeling very anxious," Keil said in an interview. "I certainly understand that."

By LARRY PARSONS, The Monterey County Herald in Monterey, Calif.

(Fri Aug 08 1997 16:09)
Microsoft anticipates slower growth for interactive media
Copyright  1997
Copyright  1997 Reuter Information Service

REDMOND, Wash. ( August 8, 1997 1:45 p.m. EDT ) - Microsoft Corp.'s money-losing interactive media group will expand
its work force by 15 to 20 percent in the next year, down from a more than 40 percent increase last year, a company executive
said Friday.

Denise White, director of new ventures, declined in an interview to say how many people worked in the group, which includes
online services such as the Microsoft Network and Slate magazine, as well as entertainment and information products like the
Encarta CD-ROM encyclopedia.

Overall, Microsoft employed 22,276 people when its fiscal year ended June 30, an increase of 8 percent from a year earlier.

White said interactive media growth is slowing after a year that saw the launch of major online ventures, including the Expedia
travel service and Sidewalk, a guide to local arts and entertainment that has been rolled out in four cities.

"We were investing in a number of different areas," White said. "We started seven new online products."

Over the coming year, executives of the group plan to identify the most promising opportunities, such as games, and "stabilize"
the work force, White said.

She also said the group would reduce the number of contract workers it employs now that many of its major products are
beyond the launch phase.

Last month, group vice president Pete Higgins told analysts and reporters the interactive media businesses would lose
"hundreds of millions of dollars" over the coming year and Microsoft would begin "tightening the screws" on investments.

"But make no mistake," he said. "We continue to be very serious about this business, and serious about winning."

White pointed out that "15 percent is still a really sizable growth for a group to sustain."

The group does not include one of Microsoft's most visible media ventures, the MSNBC joint news venture with NBC.

(Fri Aug 08 1997 16:13)
@charts later....
slick -- Nirvana was a mirage? See my 8:01 post this A.M. regarding bonds. The market participants are/were expecting 4.?% rates on the long bond. That is in serious question now. In fact, the fear is now of a rate increase. With so much money on the table, and people waiting for a capital gains tax cut... I'd take the money and run! Remember, it's better to pay short term cap gains on a profit than take a tax write off on a portion of a loss! I think Confucius told me this once, but he also said that I never listened to him either! There was good volume in the gold stocks today. The HUI and XAU indexes pulled back a little at the close, but hey, they had a good run today. Also, next week sees inflation data release. Plenty for the bond boys to worry about, especially if their assumptions are wrong.....

One more thing, I would've like to have see the HUI do a little better today. I guess you can't have everything.

Richard Burke
(Fri Aug 08 1997 16:13)
To All: I was concerned less than an hour ago with volume for ABX being low, but the closing volume made it over 2 million. Good sign. TVX responded very well today price-wise with good volume. However, GCZ7 had run down to closing time. Any concerns about the late GCZ7 action?

George Cole: Do you see another DOW rally which may or may not exceed this last top before everything tanks? I got out of all my mutual funds yesterday, but am still holding some non-gold stocks. I am heavy on gold stocks.

(Fri Aug 08 1997 16:18)
T-Bills (Japan selling?)
Traders said heavy hedge fund sales, rumors of central bank and Japanese selling, and auction-related sales exacerbated the
dim technical picture.

(Fri Aug 08 1997 16:18)
Panda, Thanks for your insights and excellent charts

(Fri Aug 08 1997 16:26)
@ HUI Fan:
Hi Panda: Hui did end up closer to the high of the day than did Xau : ) ) ) .... TVX up +9.72% today.: ) My biggest holdings. Me happy.

(Fri Aug 08 1997 16:40)
@ Watch That $$$:
Dollar vs Yen. Dollar down -3.73 yen or 3.1%!!

(Fri Aug 08 1997 16:47)
How about gold?
Does the Bank of Japan buy gold?

(Fri Aug 08 1997 16:58)
BYRON: Make sure you keep that catalyst in a safe place in case we need it again.

(Fri Aug 08 1997 17:19)
Foreign buying of Korean stocks plunges 70%

(Fri Aug 08 1997 17:46)


(Fri Aug 08 1997 17:52)
@ One Happy Cat:
Donald: CATalyst in the corner purring like a kitten : )

(Fri Aug 08 1997 17:56)
RJ: RJ what is your opinion on the market action today? Are you still shorting the rallies? ( this is not meant to be sarcasm, I am sincerely soliciting your thoughts ) Something in my gut tells me to be cautious. ( even though I am NOT a bear; I am a gold bull who has been wounded before ..."once bitten, twice cautious" )

(Fri Aug 08 1997 17:57)
The devil was not in the "gold window". The devil was in the overvalued
dollar." Tlaga walks us through dollars declining purchasing power &
role of gold from 1920-1973:

(Fri Aug 08 1997 18:10)
NAILZ: Do you think spot will bounce off the 329 range roof? Why or why not? Thanks.

(Fri Aug 08 1997 18:12)
George Cole: Here's one for you. The weekly chart on the dollar index. A shooting star to complete the week. Coupled with the bond market action it should portend interesting things to come. .... At least for those of us who are fond of humming funeral dirges.

(Fri Aug 08 1997 18:21)
Earl -- :- ) ) :- ) ) LOL! Dirges, now really! :- ) ) :- ) )

(Fri Aug 08 1997 18:23)
Savage: Regarding your crop tour through Illinois, Indiana, and Ohio -- which areas looked best and worst? Some say the Indiana crop is a disaster. They say the worst areas are southern Illinois, southern Indiana, and southern Ohio. Do you concur?

(Fri Aug 08 1997 18:26)
If this is the top for the Dow, the upcoming crash should occur between September 16th and October 10th. It looks like another October crash may be in the cards.

(Fri Aug 08 1997 18:31)
@wah street weak
wonder how loueeeeyyy baby will explain today's action on wall street week tonight?

(Fri Aug 08 1997 18:49)
APH: What do your technicals tell you?

(Fri Aug 08 1997 18:53)
SAVAGE....I think you will see a lot of volitility next week...There are all kinds of numbers to be reported next week...PPI,WPI, Retail, and a bunch of quarterly reports. I think traders in most all the pits will use those numbers from day-to-day to churn the markets...I think you will see numbers higher than that and lower than that all in the same week....I would brace up if I were in naked futures in a lot of markets next week..especially $,Y,PMs, bonds,OEX...Is the bottom in for the PMs???.....I think not....But it is getting more interesting by the day and the volitility necessary to see the bottom is definately showing....Expect more volitility...To specifically answer your question, yes $329,50 spot will be broken next week on the upside if just on intraday.....IMHOAFWIW....

(Fri Aug 08 1997 19:04)
PUETZ: re your 18:23 question...I'm sorry I cannot concur because I didn't see what evidently others ( may ) have. I live in northern Indiana and travel a lot and unless the problem is hidden ( like disease ) , I look for a barn buster. Of course, I've been expecting gold to go to the moon also ( shows you what I know...ouch! )

(Fri Aug 08 1997 19:14)
Foreigners buy treasuries and stks for last 3 years creating bull mkt in trade/ budget deficit country. They continue this as it is in their best interests UNTIL the forces of supply and demand takeover as today. The PMs are the most undervalued asset and should benefit from the mass amount of paper created. Five years ago we owned our own debt now it is owned forty percent by foreign sources and continued purchasing by these sources is needed to keep things in equilibrium. Keeping the dollar strong is NECESSARY yet tough since it is in gross over supply and US assets are both over owned worldwide and very overvalued. In this case what the feds do is of little importance. Owners of US assets can not withstand a declining dollar and declining real prices in the local mkt. This is how BUBBLES BURST!! FORGET THE CPI AND PPI!!!

(Fri Aug 08 1997 19:30)
NAILZ: My friend, I suspect that you're right on. I'm reminded that birth is via contractions...

(Fri Aug 08 1997 19:31)
Dow/Gold Ratio 24.31 tonight

(Fri Aug 08 1997 19:35)
Belated joke of the day
I have been so excited about gold going up in the face of the dwindling DOW that I have neglected to post a bit of humor to commemorate this momentous event. That being said, here it is for what it is worth:

The internationally reported Russian space station docking mishap was

very embarrassing to both the US and Russian space agencies. Both

sides quickly issued terse statements denying fault in what could have

been a tragedy resulting in lost lives. Each country immediately launched

independent investigations to ascertain the actual cause of the mishap.

After intensive study, both investigative teams arrived at the same

conclusion: Objects in the MIR are closer than they appear.

Mike Sheller
(Fri Aug 08 1997 19:36)
The Astrological Investor
Mars conjuncting NYSE Neptune today through Monday has evidenced its power, as predicted earlier, with Platinum. Pt has taken gold along with it, and Mars has shaken the foundations of the stock market. Watch Monday, after which this quick transit ebbs. Watch and wait.

(Fri Aug 08 1997 19:38)
great chart at bottom of article shows correlation of three market crashes, hope you all enjoy

(Fri Aug 08 1997 19:39)
Steve Puetz,
When is your next opinion/editorial/analysis on Gold Eagle going to appear?

(Fri Aug 08 1997 19:41)
donald- Thailand- getting visally creative'll get a chuckle out of this...not as good as Tort but..amusing nevertheless...
A huge stack of 1,000-baht
and 500-baht banknotes is
put on standby at the
Bangkok Metropolitan Bank
head office to meet
depositor withdrawals.
Panicky withdrawals at the
bank branches subsided
yesterday as more depositors regained confidence in the
bank's financial stability.

(Fri Aug 08 1997 19:43)
NAILZ: You seem to be focusing on domestic news. I would think that we are currently more under the influence of foreign factors. Weak Asian currencies are requiring Japan to sell T-Bonds to bail out their natural trading partners etc. Domestic is important but not the main issue right now. Asian news is REALLY BAD.

(Fri Aug 08 1997 19:44)
Sometimes I can't help but wonder how many people like myself check this board every afternoon yet rarely ever post any messages. As a small PM investor I don't know as much about economics as most of you seem to. I do however, have a deep mistrust of the government which inclines me to hoard all the gold and silver I can get my hands on. I can't help but feel like a fool sometimes as metals seem to always be going down. Fortunately I have this site to keep my spirits up. I can always find an arguement here to convince me to buy a few more ounces!

(Fri Aug 08 1997 19:48)
Shek: I no longer allow re-prints of my newsletters. Paying subscribers have been upset about the free postings. If you are interested in information about the Steve Puetz Letter or my book ( Total Collapse -- making the case for deflation ) e-mail me at

(Fri Aug 08 1997 19:49)
well said
WW... Well said. I don't see the coming problem as inflation/deflation, etc. It is an international currency problem... and interest rates and gold are just indications of investors' desire or lack of desire to hold our currency. We are beginning to see that there are fewer who want to hold our debt at these rates.

(Fri Aug 08 1997 19:52)
Larryn: You had better prepare for deflation.

(Fri Aug 08 1997 19:53)
NOMERCY: The guard is not there to guard the money, it is worthless, he is supposed to make sure no one steals the table.

If they are going to censor everything why bother? Did you know there is a 1938 law ( US ) on the books that can send you to jail for saying anything bad about a bank, even if it is true?

George Cole
(Fri Aug 08 1997 19:55)
the future
Those who ignored my warning not to be short gold when the dollar tops out paid the price today.

Richard Burke: Predicting the market's day to day movements has never been my bag.

But let me say this. The odds are around 90% that stocks and the dollar entered a bear market today and gold a bull market. But only the naive can expect the stock bulls and gold bears to roll over and play dead. Like the Nazis after the battle of Stalingrad, we can expect the paperhangers to bitterly contest every foot of ground and launch fierce counterattacks. Stocks are not going straight down and gold is not going straight up. But for the first time in many a moon the trend is OUR friend.

Steve Puetz could be right about the market crashing in October. But a long grinding bear market also is quite possible. As for gold, despite all the efforts of Greenspan, Rubin.Merrill Lynch, Andy Smith, etc., the $400 line in the sand will be broken decisively during 1998 after a difficult journey fraught with perils.

(Fri Aug 08 1997 19:58)
@ Now What:
Well, got that 98 XAU resistence area out of the way. However, I did not get my predicted 105 more or less for the Friday close. Well, I guess I can wait one more day. It's always good to have something to look forward to. .....BJ: Keep on buying. In a few weeks, current prices will look like big bargins in retrospect. : )

(Fri Aug 08 1997 20:02)
I respectfully disagree with GSC This is D-Day the Battle of Stalingrad was won in the early 90s ie 93. When this bubble bursts it will burst. Even GSC is cautious b/c of the spin. When the overseas boys/girls ease up on their buying it is sayanara baby!! God forbid they become actual sellers of US paper and buyers of gold!!

(Fri Aug 08 1997 20:06)
DONALD...I expect next week to be a very volitile market ( stocks, currencies, bonds and metals particularly ) for many of the foreigns as well...Many of the foreign stock markets showed volitility today as did many currencies..It should be worse for most of next week...All combined domestic and foreign will come into play next week and yes, you are right, I expect the domestics to have the greatest influence...

(Fri Aug 08 1997 20:17)
NAILZ: I just pulled up the Yahoo International stocks. There were 15 countries down more than 1% today. Seven of them were close to 2%. Most of those losses were in Europe before the US even opened. Something else spooked them. Mabye the 71 point slide Thursday? Why on earth did Japan rise 128? I can't see a reason for that. Another point. Greenspan has his hands full with the bond market. That keeps him from playing games with stocks as he likely did in 1987.

(Fri Aug 08 1997 20:21)
BYRON: The guest on NBR tonight was Eugene Pieroni. He gave a reco for Newmont Gold and Newmont Mining. That might help the XAU on Monday.

(Fri Aug 08 1997 20:23)
China-S & N Korea-U.S.- talks unexpectedly break off
AGENCIES in Washington and New York
The effort by the two Koreas, China and the United
States to set up peace talks aimed at formally
ending the Korean War broke off unexpectedly
after failing to resolve differences over topics the
discussions would cover.

(Fri Aug 08 1997 20:24)
Donald, regarding 'saying bad things about banks', and thus breaking the law; I looked up Webster's definition ( s ) of 'bank': ( a ) bank - "an establishment for receiving, lending, or, sometimes, issuing MONEY" ( -my caps ) ; ( b ) bank - "a long mound or heap".
Now, considering definition " ( a ) ",since there is no bank, that I know of, anywhere in the world, that is receiving, lending, &/or issuing real money, to anyone, anywhere; I guess we can feel free to say any nasty
thing about those institutions of pretense, fraud and deceit, that we care to. And considering definition " ( b ) ", I can't think of anything nasty to say about 'heaps and mounds', unless they are heaps and mounds of bull-s___.

(Fri Aug 08 1997 20:30)
Kenya: World Bank warns about


By Michela Wrong in Nairobi and Michael Holman in London

Kenya came under renewed pressure yesterday when the World Bank
warned that unless its government tackled corruption issues which had
triggered a cut-off in International Monetary Fund lending, Bank aid would
also be "substantially reduced".

In the toughest message from the World Bank since the IMF last week
suspended its $220m ( 135m ) loan programme, senior officials said the
institution took the issues that prompted the IMF decision "extremely
seriously" and was "absolutely behind" the Fund.

Kenya was relying on World Bank funding to renovate its dilapidated road
network, including the Mombasa to Nairobi highway, and modernise its
energy sector struggling to meet demand.

"Now that the signal has been sent, we hope the Kenyan authorities are
going to aggressively tackle the issues of economic governance," said an
official. "It is in their interests to get round a table and settle these issues.
Failing vigorous action, World Bank aid will be substantially reduced."

The warning was likely to further undermine the Kenyan shilling, which
regained some ground yesterday but has lost nearly 16 per cent of its value
in reaction to the IMF's "no confidence" verdict.

World Bank officials said in the circumstances it would now be impossible
to disburse a $71.6m structural adjustment credit, due this year but already
delayed by Kenya's failure to satisfy specific conditions dealing with
privatisation and energy sector management. While some individual
infrastructure projects might be completed for contractual reasons,
projects not yet declared effective would remain on hold until IMF
governance concerns were met.

Contradicting a recent statement by Kenya's energy ministry that the
breakdown in relations with the IMF would not directly affect power
sector funding, Bank officials said a Sh7.5bn ( 75m ) energy sector project
was among those now unlikely to go ahead.

The strong World Bank statement came as advocates of constitutional
reform maintained pressure on President Daniel arap Moi, staging a
national one-day strike to support demands for legal and constitutional
changes before elections expected this year.

The protest turned ugly in Nairobi, where members of a 1,000-strong
crowd that had gathered in the central Uhuru park set upon a man who
pulled a knife and beat to death a policeman who had infiltrated the rally in
plain clothes.

Supporters later marched through the centre of town, where the vast
majority of traders had closed their shops for fear of looting, breaking
store windows, setting up barricades and throwing stones. Although the
government had declared the strike illegal, the security forces kept a low
profile, apparently wary of a repeat of July 7, when television images of
riot police clubbing unarmed demonstrators shattered Kenya's reputation
as a peaceful democracy.

The low turnout for the rally, and mixed responses in a scattering of main
towns, appeared to reflect divisions in the opposition movement, which has
recently split over the issue of whether to accept Mr Moi's pledges on
constitutional and legal reform or hold out for more far-reaching changes.

(Fri Aug 08 1997 20:32)
DONALD......Cheaper yen/dollar good for foreign trade...More exports for Japan.. More exports = more profits = good for Japaneese business.......= stock rise....

(Fri Aug 08 1997 20:33)
Thailand - arm twisting for rescue loan
IMF - Japan - Asean countries - they have to deliver on their promised rescue - some countries are reluctant uuhhmmmmm!

(Fri Aug 08 1997 20:36)
DAVID: That is obviously an accurate dictionary. It did not say that a bank was a place to save money. They just "receive" it.

(Fri Aug 08 1997 20:38)
Ringgit braces for
renewed attacks from

(Fri Aug 08 1997 20:42)
Now we're wasn't only Soros but a 'Wolf pak' of US hedge funds ( 2000 ) who jumped on the bandwagon...and they're still hungry!

(Fri Aug 08 1997 20:45)
Rupee devaluation fear keeps foreign investors away from
bond market

KARACHI ( August 8 ) : While in the face of a ballooning
current-account deficit Pakistan badly needs foreign investment has not yet
started to-flow into the currency debt market despite complete removal of
all taxes on such investment, to the disappointment of the economic
"Given Pakistan recent history of large devaluations, long -term
investors are reluctant to venture into the bond market", according to me
Government, in its capital market package last May, had withdrawn
Withholding Tax on foreign investment in debt instruments to attract more
funds which would have ultimately resulted in lowering the cost of
government borrowing.
Analysts said that foreign investors were not willing to invest in the
primary bond market out of fear of currency devaluation. As supply side
measures were expected to swell the trade deficit further, investors
expected the rupee to come under renewed pressure after the first quarter
of this fiscal year, they added.
"I expect 25-40 percent increase in imports if supply-side measures
work, and this will exert pressure on SBP to devalue the rupee
significantly", an economist at a foreign bank said.
He said before entering the local bond market, any investor would
examine the country's currency risk. If SBP kept to the course of 'crawling
peg' devaluation, and government received the first tranche of ESAF on
time, foreign portfolio investment would definitely come.
Pakistan equity market has witnessed huge foreign investment
recently, but investors did not enter the bond market.
"Foreign investors are very much interested in short-term
participation in the secondary bond market where yield on one-month
STFBs is 13.5 percent, but the rupee conversion spread, which is now
around 26 paisa, is discouraging them', Naz Chohan, money analyst at
KASB said.
Foreign investment in Pakistan equity and bond markets can only be
made through Special Convertible Rupee Account ( SCRA ) , where dollar
buying and selling spread is now around 0.7 percent. This comes to around
8.4 percent per annum. After the adjustment, of 8.4 percent, what would
be left of the 13.5 percent return on STFB, would be hardly an attractive
yield when US treasuries bonds were offering 6.05 percent per annum.
Naz further said the continuous fall in yield on six-month STFBs was
another reason, which kept investors away from these debt instruments.
The yield on six-month short-term federal bonds ( STFBs ) has come down
from 17.5 percent since May,1997 to 14.9 percent on Wednesday's
Foreign investment in the local bond market was allowed a couple
of years ago, but Withholding Tax as high as 60 percent was so
prohibitive, that virtually no deals worth the name were reported so far.
Given historically low interest rates in wealthy countries, emerging
market bonds called 'Zunks' are very much attractive for foreign money
managers. Last year governments and companies in emerging markets
issued below investment grade bonds worth about $74 billion. J. P.
Morgan Emerging Market Bond Index also rose to 39.3 percent last yea

(Fri Aug 08 1997 20:47)
To Donald :


Each day you post the most informative items. I would like to know where you're getting them from. The items I'm talking about are the long ones that contain information about each country or area. Thanks in advance...


(Fri Aug 08 1997 20:51)
From Iranian Press
Chinese Officials for Promotion of Tehran-Beijing Relations

TEHRAN The outgoing Iranian Ambassador to China Hossein Mirfakhar held separate meetings with
ranking Chinese officials in Beijing on Tuesday. In the meetings, the Chinese officials expressed pleasure
on promotion of Iran-China bilateral relations particularly in political and economic sectors. Chinese
Minister of Supervision Cao Qingze said in a meeting that the two countries' cooperation in matters related
to inspection expanded rapidly during the recent years and it had left positive impact in the control of
possible violations of the government agencies of the respective countries. He pointed out that he would
pay a visit to Islamic Republic of Iran in order to confer with the Iranian high ranking officials. In another
meeting, the head of the Foreign Policy Commission at the chinese National People's Congress Julian
called for further promotion of relations between the parliaments of the two countries and welcomed
expansion of relations in political and economic sectors between Islamic Iran and China. The head of the
Friendship Group of the Chinese People's Congress Man Lian Ken in a separate meeting indicated that the
relation between Iran-China parliaments played a significant role in promotion of bilateral relation

(Fri Aug 08 1997 20:55)
Proton: Car maker warns on ringgit


By James Kynge in Kuala Lumpur

Earnings at Proton, the maker of Malaysia's "national car", will be hit by
the depreciation of the ringgit against the Japanese yen, Mr Mohammed
Saleh Sulong, the company's chairman, said yesterday.

The warning was one of the first acknowledgements by a Malaysian
corporate leader that the ringgit's recent decline against the US dollar and
other main currencies was already affecting results. It also demonstrated
Proton's dependence on components imported from Japan.

Mr Saleh said that Proton's profits this year would grow, but not at the
126 per cent rate achieved in the previous 12 months, when pre-tax profits
jumped to M$1.03bn ( US$390m ) .

Proton buys most of its engines from Mitsubishi Motors, the Japanese
carmaker which has a significant equity stake in Proton. Some 20 per cent
of its costs are denominated in yen, which has appreciated 7 per cent
against the ringgit this year. The yen's depreciation, by 13 per cent last
year, was one of the main reasons for Proton's surge in profits.

Other complex components, which Proton sources locally, contain parts
that come from Japan. Although Proton does not directly bear the cost of
these, industry analysts said the yen's climb would complicate a campaign
to reduce the cost at which Proton buys components from local suppliers.
Much of the increase in last year's profits came from cutting these costs.

The adverse currency movements coincide with signs of a slowdown in car
sales and a loss of share for Proton in the domestic market. "There is a
general consensus that in the second half of the year, the economy is
becoming harder," said Mr Saleh.

In May, Proton's market share fell to 60 per cent, compared with 65 per
cent for all of last year and a historical peak of 74 per cent in 1993.

Mr Saleh noted a slight decline in market share, but said this might be a
temporary phenomenon. "It is not time to push the panic button," he said.

ron Jett
(Fri Aug 08 1997 20:57)
there are some gold charts ready if anyone wants to take a look.

(Fri Aug 08 1997 21:00)
"heavy paper came into gold ring as Dow was around 8075
``Gold is still only about $10.00 an ounce off its 12-year lows, but the bullion market has absorbed huge supply in recent
weeks and there is a feeling that today could be the start of some asset price deflation, so my own feeling is gold could edge
higher from here,'' he said.

(Fri Aug 08 1997 21:00)
FRONT: They come from all over. Some of the best ones are at this URL. You need to register but it is free. I will post another also.

(Fri Aug 08 1997 21:05)
FRONT: Here is another good source. You have to hunt for the English language sites. Some are English but not marked.

(Fri Aug 08 1997 21:12)

A lot of successful currency traders follow trends. One of the reasons that orderly trends evolve in the currency markets is because central banks and politicians fight them. This has the effect of slowing down currency moves so that more people can pile in. Even little old traders like ourselves managed to score a few ringits.

(Fri Aug 08 1997 21:24)
Mike Sheller: I hold a substantial amount of Platinum and missed in selling on the last two run ups.
I would like to understand your statement more clearly. Is it your read that Platinum will run again next week, then turn down ["this quick transit ( up? ) ebbs"].

(Fri Aug 08 1997 21:34)
FRONT: I have been searching for the European stock exchange analysis and can't find it. Is that what you are looking for? It may not be written yet. I think the weekend schedule is different. Still looking.

(Fri Aug 08 1997 21:44)
To Donald:

Donald, Thanks for the information. I got started into the FTSE by following the links and am now awaiting a booklet from the FTSE exchange on their activities. Too bad I don't have unlimited access. Boy could I enjoy those sites! Thanks again...


(Fri Aug 08 1997 21:45)
Will these questions never cease???
John Disney - Head is now fine. My mistake was that in your Aug 07 - 03:52 you said "the costs in Rand/ton ARE after subtracting by-product revenue". I assumed you were refering to the 200R/ton you mentioned in your previous post. Now that this is cleared up, all the numbers make sense. For the record, by my calculations, the cost net of by-product revenue is actually 96 R/ton. This is the factor of 2 I was looking for -- and NO! I wasn't acusing you of making a factor of 2 mistake. I have more faith in you than that. Just needed to find out where the inconsistancy was. Thanks for your help.

However, your revenue numbers raise another question. 3780MR in revenue divided by 1.5Moz of platinum = 2520 R/oz. at 4.5 R/$ = $560/oz. Since the spot price of PL averaged less than $400/oz. in their FY1997, how did they achieve such a high price? Any clues? ( I assume the income from the by-product metals show as a reduction in cost, not as revenue. ) More importantly, however they did it, can they do it again in FY1998?

(Fri Aug 08 1997 21:45)
Thirty year bond index;

(Fri Aug 08 1997 21:50)
To Donald:

Actually Donald, the one that comes to mind immediately was the one the other day that had all about asia in it. It had a short paragragh about each country i.e. Malaysia, Singapore etc. and talked about the devaluation of the THAI monies and the effect on the other areas. Does that ring a bell?


(Fri Aug 08 1997 21:53)
George Cole: I agree with your 19:55 posting.

(Fri Aug 08 1997 21:54)
To D.J

DJ your post of:

Date: Fri Aug 08 1997 14:41
DJ ( @Front ) :

Front - Better than being front to Back!

Actually you don't know how close to the truth you are about how one get's a nickname!


(Fri Aug 08 1997 21:56)
@barbadoe ranch
Louis Ruekeyser on People's Broadcast System replaced tonight in central Texas by Peter, Paul & Mary and some animated fuzzy things. An omen or a blessing? Go gold!

(Fri Aug 08 1997 21:56)
DONALD, From this URL I downloaded the Fed Y2K file into my hard drive. I think you must have adobe acrobat as it is a pdf file. It ran ok with acrobat on my hard drive. If this doesn't help let me know, I'm not much of a computer nerd but I know some good ones at work AND I will be working all weekend.

(Fri Aug 08 1997 21:57)
George Cole: However......... Gold is likely to exceed $400 before 1998 begins, and the bear market in stocks is likely to begin with a crash.

(Fri Aug 08 1997 22:04)

I re-read your earlier post agreeing that George should be honored. So to make it official, we need to hear form Earl for his vote. It can't be transsfered without total agreement as it's an honour that few achieve but many want. In that vein, the rules require that only former winners of the award may nominate or post the newest winner. That in effect, will eliminate the rabble from nominating one of lower statute than previously required ... ( nose must be firnly stuck in the air when typing the last statement! ( :- ) ) . So, if the Duke of Earl would kindly give his agreement, we may proceed with the coronation. If not, tough noockey!

What say you Earl ?


(Fri Aug 08 1997 22:04)
to Roebear and Donald
Roebear: look at my today's post Fri Aug 08 1997 10:20
( Links to all Senate Testimony on Y2K without downloading )
it contains links to the Y2K file you are referring to ( and some others )
You don't need Acrobat to read it.

(Fri Aug 08 1997 22:06)
@piles of cash
nomercy @19:41 -- The last big bank failures in Japan prompted the same type of 'display'. The cash ( YEN notes ) were piled high along the counter where the tellers stood. This was to 'inspire' confidence in the depositors that the money was 'there'.

Of course, it was still warm and smelled funny as it had just come off of the presses. :- ) )

(Fri Aug 08 1997 22:16)
Question answered
John Disney - I think I have answered my own question. Since you show a cost of sales of 3190MR, this must include the cost of the by-products. Thus the revenue of 3780MR must include the proceeds of the sale of by products. Since we agree that the by-product proceeds is about 1600MR, platinum revenue must have been 2189MR or $353/oz., which is acually lower than I expected.


1. Same production rate in 1998
2. Prices for by-products 10% higher
3. Average PL price $425

Then, income for 1998 could be up 40% from 1997 -- an interesting number.

(Fri Aug 08 1997 22:18)
Donald @ 20:17 -- Regarding the world wide stock slip, it was probably due to the primary dealers in the thirty year bonds not being able to unload the paper that spooked the markets world wide. The demand wasn't there. In order to create demand, you have a 'sale'. Prices marked down accordingly, interest rates move up accordingly... Stocks have to compete with bonds, and at these rarified levels, nose bleeds are common. Couple that with a rate hike/inflation fears in Great Briton...

Let's face it, if you bought Intel at $100, where would your stop loss be set at? Now if I could just do that with gold stocks...

(Fri Aug 08 1997 22:27)
The Dow had its largest intra-day decline since March 1996...and Sunday night the carnage should continue in Hong Kong as the Hang Seng has been mirroring the Dow recently....Europe will open down but will the "dipsters" turn things around in New York or will the plunge accelerate??
...It's been know to happen on a MONDAY....Important economic stats out next week are: Wed. ( Retail sales ) ...Wed. ( PPI ) ....Thurs. ( CPI ) ....some strong numbers and things could really get WILD...Gold's action on Sunday night should tell us a few things on its near-term direction...

(Fri Aug 08 1997 22:38)
John Disney - Time to take a break! One more time.

Total revenue 3780MR less by-product offset of 1600MR yields 2180MR of platinum revenue from 1.5Moz = 1453R/oz = $323/oz.

Now this does seem too low. Comments?

(Fri Aug 08 1997 22:52)
To summarize briefly my analysis of the Kondratieff Wave for our times: gold up, interest rates up, stocks up and down, consumer and producer prices up, economy up. Real estate up. Enjoy.

(Fri Aug 08 1997 23:29)
waiting room
To Panda:

Regarding your 22 minute fill order @ Schwab......

"Moreover, big brokers often have a small inventory of actively traded stocks they make a market in and can effectively cut-off
( cross ) an order before it hits the exchanges. A brokerage house can also program its computer to recognize when two orders
flowing in from their regional offices make a pairing that can be summarily crossed. Generally, the broker keeps the spread, but
some brokers give the advantage to the customer. Most notable in this respect is Schwab's new "no spread" trading system
which crosses customer orders for participants. Instead of executing your order on the normal markets immediately, Schwab
routes it to their "waiting room". If there is another order there that mates with yours the trade is immediate - if not, you sit
there until that mating order shows

(Fri Aug 08 1997 23:29)
waiting room
To Panda:

Regarding your 22 minute fill order @ Schwab......

"Moreover, big brokers often have a small inventory of actively traded stocks they make a market in and can effectively cut-off
( cross ) an order before it hits the exchanges. A brokerage house can also program its computer to recognize when two orders
flowing in from their regional offices make a pairing that can be summarily crossed. Generally, the broker keeps the spread, but
some brokers give the advantage to the customer. Most notable in this respect is Schwab's new "no spread" trading system
which crosses customer orders for participants. Instead of executing your order on the normal markets immediately, Schwab
routes it to their "waiting room". If there is another order there that mates with yours the trade is immediate - if not, you sit
there until that mating order shows up. In either case, Schwab takes its commission and splits the spread with the two
customers. It remains to be seen how well this idea works. Evaluating the potential for a delayed trade and the price volatility
of the stock itself versus the spread savings will make it difficult for an individual to decide whether to participate."

Entire article located:

(Fri Aug 08 1997 23:30)
waiting room
To Panda:

Regarding your 22 minute fill order @ Schwab......

"Moreover, big brokers often have a small inventory of actively traded stocks they make a market in and can effectively cut-off
( cross ) an order before it hits the exchanges. A brokerage house can also program its computer to recognize when two orders
flowing in from their regional offices make a pairing that can be summarily crossed. Generally, the broker keeps the spread, but
some brokers give the advantage to the customer. Most notable in this respect is Schwab's new "no spread" trading system
which crosses customer orders for participants. Instead of executing your order on the normal markets immediately, Schwab
routes it to their "waiting room". If there is another order there that mates with yours the trade is immediate - if not, you sit
there until that mating order shows up. In either case, Schwab takes its commission and splits the spread with the two
customers. It remains to be seen how well this idea works. Evaluating the potential for a delayed trade and the price volatility
of the stock itself versus the spread savings will make it difficult for an individual to decide whether to participate."

Entire article located:

George S. Cole
(Fri Aug 08 1997 23:34)
Steve Puetz and WW: I sincerely hope you are right about near-term fireworks in the gold market. I am now out of stocks entirely, but have a big position in gold funds. But my best judgement is that it will take considerable time to breach $400. But when we do, $500 or even $600 will follow very shortly.

Why is this stock market break different from the past drops that proved to be buying opportunities? Because the dollar plunged and gold surged. This is the first stock and bond market break to be accompanied by surging gold prices. Those who buy this dip will bitterly regret it.

Captain Bill at the Privateer, while still not declaring a gold bull, is becoming more optimistic. He accurately points out that all recent SUSTAINED upward moves in gold prices ( 1973-1980 and 1985-87 ) were accompanied by rising interest rates. The brief but unsustainable 1993 bull occurred in the context of strong bond and stock markets. This gold bull will be much stronger and will last much longer.

(Fri Aug 08 1997 23:44)
Today was a Teaser . . .
By midday, the charts looked favorable and excited a few Kitcoites. I feel it was simply a bit of a tease. A reason ( excuse? ) for the Dow to climb to higher levels next week. "See, the Dow can drop 200 points intraday and still regain and continue to perform . . ." By the same token, gold bugs saw the near-330 test many have been waiting for. It too was a teaser, gold will lose today's small gain _early_ next week, IMO.

The Dow will see yet another strong upsurge, keeping in line with its current exponential rise. Gold is headed toward 300 no matter what we would wish. The sooner it happens ( further gold decline ) , the sooner we get to experience "Phase III" - - Perhaps a lower price still, but an ultimate reversal in gold price.

nomercy, your optimism is just a trifle premature by my reckoning . . . I would tend to wait a bit before determining that the gold bottom was secure . . .

"Been researching my next airplane buy in anticipation,"

Best Regards, Niner