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.

(Sat Dec 27 1997 00:02 - ID#23782)
I remember having read facts about 2 different cycles.

1 ) Gambling will peak in 1998 - I read this in about 1990

2 ) Violence will peak in about 2005. - I read this in about 1993.

Have you bumped into similar peaks in these cycles in your studies?

Do you have any opinions on these cycles?

(Sat Dec 27 1997 00:09 - ID#34592)
@ Schultz
I am so glad to see excellent rationale in your thinking. Gold will be eventually confiscated ( as many countries have done ) and I for sure will not risk going to jail for gold's shake. Your numismatics is an excellent alternative to bullion.

Prefer liquidity and mobility. May be the stocks will offer just that.

(Sat Dec 27 1997 00:16 - ID#316232)
Schultz and Puetz;;;;

To enter your discussion:

Civilization is too complex to have only gold and silver as currency. There WILL be a paper currency in use, at least in the US, whatever happens short of the end of the world as we know it. The value of that currency will be reflected by the price of gold/silver in that currency.

From $300/oz to $3000 is a ten fold change. For the dollar to depreciate 90% in a few years would require that the rest of the world send us back all of the dollars overseas, which I consider totally unlikely. Even then it would require massive printing of new dollars and a total disconnect commercially of the exporting third world with the US. In addition, if gold went to $3000, it would require that all other currencies go into the inflationary tank with us. This requires that they also print new money like mad, with no deflation/depression. Highly unlikely.

History has shown that such a massive change in currency evaluations always results in economical disfunctional international commercial arrangements which quickly break down into a low trade depression.

Since I don't relate well to 10 year economic predictions because they are almost always wrong, I can see gold going to 500-800 within three years if the Asian crisis keeps spreading to Japan and then the US. But only if the US dollar falls out of bed by 50%, and the yen dives also. Since the US has a stockpile of gold, we will still shine compared with most the rest of the world. Above $3000/oz is dreaming.

OK, your turn, shoot me down. Talk numbers, please.

(Sat Dec 27 1997 00:17 - ID#339274)
JTF..We are entering in the same kind of time frame '69 and '70.The stockmarket will go into crash mode at the end of February
we will witness first a sharp decline in January ,a recovery
in February.'42 and '14 showed similar patterns.I believe there will be a recovery but an inflationary one,that will play itself in increased
gold and stockmarket prices.The Fed will do whatever it can do to keep
control with the other CB minions,the alternative will be total chaos
or war.Dewey and other prognosticators have recognised that we are
all subjected by cycles including A.G.Other than that I trade for a living and will let the market decide.

(Sat Dec 27 1997 00:21 - ID#34592)
@ Schultz
Another point of interest:

During the depression when gold was confiscated at around $20/oz. many Americans turned it in for that price. Coincindentally, the money they got if they bought stock in the midst of the depression, they saw much better returns in a few years time, than if they had kept it for $35/oz.

The point I am trying to make is that even if they missed in the upvaluation of gold, they had other investment vehicles to recover the unrealized gain. Something which is never mentioned.

(Sat Dec 27 1997 00:21 - ID#57232)
Fractional banking
Schultz: I think your comments about fractional banking are very similar to those of SDRer. In the not so distant past -- such as in 1931 when the pound sterling went down for the last time as the world's currency -- there were currencies that were either rigidly linked to gold, or had just came off the gold standard. Now even countries with substantial gold reserves let their currencies float, so how does one tell which country is really not in trouble? It is only a matter of degree.

I think floating a currency does offer the advantage that corrections in relative worth can be made continuously, avoiding much of the trauma of devaluation.

Perhaps the biggest problem is that with this steady inflation, the gold that we use as the reserve of last resort appears to become less useful in this context with time. What good is a reserve currency that gets less "valuable" every year all over the world? Given the amount of paper in circulation around the world, versus the amount of gold available, gold should be worth thousands of dollars/oz as a reserve currency.

Gold -- the currency of last resort -- is rigidly being pushed down -- sort of like a fixed exchange rate currency inflating "in reverse", its public "paper face value" steadily becoming worth less and less relative to its true value.

Someday many people will realize that gold in all "paper" currencies is way undervalued, and we will have that crisis ANOTHER is warning us about. Gold will soar, even in Swiss francs! And -- yes gold could rise much higher than that $34 to $860 surge that ended in 1980. That ultimate crisis will come on the demise of the US dollar -- but this could still be years away.

(Sat Dec 27 1997 00:24 - ID#339274)
Sweat..Only one I'm familiar, is the war cycle to end circa that
time frame,soft and grain commodities will have gone through the roof

(Sat Dec 27 1997 00:29 - ID#189273)
Not familiar with Sarker's cycles. Sounds worth reading. Is there a book in print or newsletter? or historical?

(Sat Dec 27 1997 00:29 - ID#34592)
@ Cyclist
.. and when I mentioned "Archer Daniels" earlier on, I was shot down!

(Sat Dec 27 1997 00:31 - ID#316232)
yield curve
Thanks to PANDA, 26 Dec, 22:09,
I think one of the most important graphs ever posted is the spread between the long bond rate and the 90day short term rate. The actual spread is important but the main point is the change in the spread, as shown by a climbing plotline on the above referenced post. The low point and resulting increase in the spread is a result of the long bond rate increasing from a recent low, and matches today with late 1995, just before we had a major rally.
Recently the long term rate bounced off of 5.83 and is holding at 5.90. If this is the real bond rate bottom, then gold has also bottomed.

(Sat Dec 27 1997 00:42 - ID#57232)
Price controls never work, and that is what we are doing with Gold!
All: I have one more comment before I log off. The "powers that be" have artificially depressed the price of gold -- in the delusion that by so doing, confidence in paper currency will be maintained. Unfortunately by so doing they have created the delusion that gold is worth selling, as well as artificially alter it's true price as a currency reserve. Fortunately some of the larger central banks realize its true hidden value.

My comment is the following: If the true value of gold was always floating in a free market of some kind, the discovery of the lie regarding its true value would not be there to cause financial shock.

We all know that any attempt by world leaders/governments to artifically manipulate supply and demand of any good -- even gold -- will lead to eventual serious disruptions! Price controls never work, and that is what we have done with gold. Price controls in reverse!

(Sat Dec 27 1997 00:44 - ID#339274)
Myrmidon..Big companies will continue to survive.They will IMO have
gained market share especially commodities people cannot do without.
Oil and food stuffs.The military will be in the ascendency while the
world gets mired in a global depression.

(Sat Dec 27 1997 00:47 - ID#301188)
Re: Cyclist
I basically agree with your market cycle projections for early 98. My fear is Clintons willingness to create a big enough diversion - a war ( and Saddam fears it as well ) . It's Clintons last ace in the pack and he's been flashing it to the world for the last several weeks. Let's hope he doesn't pull it out on us. Cheers.

(Sat Dec 27 1997 00:54 - ID#287207)
Myrmidon: Do you have any figures on the amount or value of the gold that was confiscated by the US Gov during the '30's?

(Sat Dec 27 1997 00:55 - ID#335190)
Myrmidon @ 23:42
Date: Fri Dec 26 1997 23:42
Myrmidon ( @ 6pak ) ID#34592:
How far down?

Down ? I do not understand. If you reference the 1930's as an example of down. Unemployment was 25 %, 75% were working for reduced wages. Yet, they were working. A worker without a job is nothing, very much down.

In 1997, youth unemployment is estimated at 18% ( I suggest it is 22% ) in Canada. "Down" to these citizens, means bust, bottom, crash, no hope. To those with jobs, it means, stress and prozac, mood altering drugs etc.

Consider the positive aspect of the new economy, and the spin that all is well, and the Central Bankers are doing an outstanding performance for the people of the world. Many times at this site it has been stated that Mr. Greenspan is a powerful force for the good of the USofA and the World. And many are thankful he is the spokesperson for the Corporate interests of the USofA, and the world.

No spokesperson can be heard, to bring forth the interests of the "We The People" sad, but a fact of life as a result of the new economic standards. Government-Labour-Business know best, together they stand.

There is no down, ALL IS WELL. Read Mr. Greenspan, and watch the ticker tape. Down can not be heard, or seen. Trust & Believe, all will be well eh!

(Sat Dec 27 1997 00:58 - ID#57232)
P.R. Sarkar
Promethius: I agree with you that Sarkar's cycles are compelling. To me at least it makes sense that a civilization could begin with a military leader/conqueror type in power. During the stability this offers ( if everyone benefits ) , intellectual types flourish, creating new ideas/inventions/concepts. Eventually the civilization matures, and the acquisitor types whose main function is collecting wealth for its sake take control, ultimately taking the wealth from the people whose very existence is needed to make that civilization stable. The people rise up, and willingly give the power to a new leader/conqueror type, thus completing the cycle.

The logic of this cycle seems to me a disturbingly accurate reflection of the many facets of human nature. Unfortunately, I do not have a reference -- just the name P.R. Sarkar. I would read more of his/her work too, if I knew where to find it.

(Sat Dec 27 1997 00:58 - ID#339274)
As it has been said before...

The budget should be balanced..
The treasury should be refilled..
the public debt should be reduced.
The arrogance of the officialdom should be curtailed,
lest we become bankrupt.
--Cicero ,63 B.C.
Have we learned?

(Sat Dec 27 1997 01:02 - ID#252150)
Puetz, You state that the U.S. will suffer a collapse
similar to the Roman Empire. I don't know how you can reach that conclusion. When the Roman Empire collapsed it had been weakening militarily for many centuries. The U.S. is militarily unchallenged. As long as the U.S. has access to relatively cheap oil, I don't see how a financial collapse could occur. With Isreal about to destroy Iran's nucleur capability, cheap oil is assured for an indefinite period. The U.S. is only dependent on trade for around 12% of gdp. With the Asian Countries desperate to export their goods at sharply reduced prices the U.S. does not look to me like a Country that will go gently into that good night.

(Sat Dec 27 1997 01:29 - ID#287207)
P R Sarkar
This fellow doesn't sound like your average gold bug

(Sat Dec 27 1997 01:35 - ID#22650)
Some have learned, most, it appears, have not.

(Sat Dec 27 1997 01:42 - ID#57232)
P. R. Sarkar
Selby: Thanks for finding that site. Believe it or not, that is indeed the same P.R. Sarkar. I was looking too. It turns out that Ravi Batra wrote a book called "The Great Depression of 1990" which years ago I scanned. Ravi Batra, whose impression of the future is very much like James Earl Davidson and Rees-Moogs "The Great Reckoning", frequently quoted P.R. Sarkar. Given the current times, these books need serious review if you have not read them.

Apparently Ravi Batra has an entire chapter devoted to the Sarkars "Law of Social Cycles", in his 1985 Simon and Shuster edition of "The Great Depression of 1990". Apparently these Social Cycles of Sarkar last hundreds of years.

(Sat Dec 27 1997 01:43 - ID#22650)
Events move much, much faster now. The world is very interconnected and while that may be a strength, it is also a vulnerability. While we may seem financially invincible now, a few months can be like years a century ago. I reference the current Asian crisis. Was it only 6 months ago that the Thai currency came under attack? And now the 11th largest economy in the world is broke. Maybe the bright side of this is that if global meltdown can occur so quickly, global reconstruction will be as rapid.

(Sat Dec 27 1997 01:46 - ID#22650)
Raymond Wheeler
Has anyone ever seen the Wheeler Weather Cycle? This is a plausible explanation for the triggering and regularity of cycle affecting human behavior. Also Iben Browing. More contemporary, William Houston's "Riding the Business Cycle"

(Sat Dec 27 1997 01:47 - ID#57232)
I think P.R. Sarkar was trying to find ways to break those harmful cycles that he discovered. He also reminds me a bit of Ghandi. I guess we should all remember that we should strive to improve things -- not just leave them as they are. A tall order I think when you are addressing basic qualities of human nature that cause cycles of war and peace.

(Sat Dec 27 1997 01:52 - ID#287207)
JTF: I read both the Great Reckoning and the Great Depression some years ago in anticipation of the 50 year wave that seems now to be late-- although it may look like its is here to some Asians. I was impress with the Great Reckoning and its comments on countries coming apart and it appears correct in the former USSR. Great reading and I enjoy listening to Davidson when he is on TV flogging the book.

(Sat Dec 27 1997 01:58 - ID#57232)
human behavior and the environment
pagoda: I have a book that I just got, titled "The Dimension of Creation", written by a fellow named Fred Crook, a retired Physicist. He shows convincingly that natural events in the earths environment -- which affect the weather, among other things -- are also synchronized with human behavior. In fact the same fibonacci series type pattern that we see in the stock market, is also in a multitude of other natural events that surround us. The bottom line is that everything we do is linked to some degree to natural phenomena. I don't see the Wheeler Weather cycle listed in the index. I have Colleen, one of our posters from South Africa to thank for alerting me to this work.

I will post relevent stuff from this massive work, as I slowly digest it.

John Disney__A
(Sat Dec 27 1997 02:00 - ID#24140)
For Mike Sheller and Colleen-

I checked Rangold's results from same month last

year ------ Quarterly and 12 month results were

issued on JANUARY 23, 1996. They will be within a day

of that this year Im sure.

I am a lot more interested in the OTHER member

of the Rangold stable - Harmony .

Think about it, Mike, The Harmony of the Universe,

How can it miss ??

(Sat Dec 27 1997 02:01 - ID#57232)
G'Nite all!
This Cycle stuff also includes the sleep cycle, which I have been unable to avoid -- Good night!

(Sat Dec 27 1997 02:14 - ID#255284)
Oh No,, Asian Mystery...another false baba free john, gimme Lobsang Rampa anyday
Um, scuse me, is that Sarka of ananda marga fame? ANanda Marga are we talking terrorist here? I mean, has everyone forgotten the bombs? The lunatic fringe of eastern/western yogibollox? Ananda Marga, Ravi Batra? recycled apocolypse

Reminds you of Ghandi JTF? Ananda Marga actually murdered some of their apostatic disciples. There were bombs to dissenters. Sarka like Ghandi! spare me.

Cycles taken too far, I thought you were a scientist JTF?

away to throw the runes

and look for a razor of occam.. time to off the aurator.

(Sat Dec 27 1997 02:19 - ID#255284)
my email playing up, didja get mine?

John Disney__A
(Sat Dec 27 1997 02:20 - ID#24140)
Lady Macbeth speaks -

for Haggis

Saw your posting - but no speeka da lingo

No speeka crapspeak

No speeka Burnspeak

Thanks for all your kind attention - sayonara


John Disney__A
(Sat Dec 27 1997 02:24 - ID#24140)
Sweet confusion
for Haggis

Sorry Mr Haggis

Computer ate half a sentence - subject should read -

Lady Macbeth speaks - "Out Damned Scot - er.. Spot"

(Sat Dec 27 1997 02:27 - ID#347457)
@James and a collapse of the US markets
James, its getting late on the East Coast so I am not sure I read your 1:02 am post correctly . You are either kidding or are painting a frightful scenario. Are you suggesting that the US should ( will ) use its military superiority to keep markets from collapsing? If that is the sentiment among US investors than I am really heading for the hills. Please clarify.

BTW, Roman Empire kept its military superiority till its demise, however, it was not able to control its ever expanding "globalization" of its empire. I would like to see how the US would control ( despite its military power ) multiple conflicts around the world.

(Sat Dec 27 1997 02:27 - ID#255284)
offence is at the bottom of the garden
I apologise if I have offended any deeply held beliefs

away to off the aurator

so noone else does

John Disney__A
(Sat Dec 27 1997 02:28 - ID#24140)
Zulus have cut the telegraph wires - ??

For salty

I get my emails to you back with note

has "permanent FATAL errors"

This sounds pretty SERIOUS - are you feeling okay ??

John Disney__A
(Sat Dec 27 1997 02:36 - ID#24140)
A very good Elliott waver walks among us

To All

MY son - who lurks - has told me that the postings of APH are

rare but priceless. I agree.

The stars are important - but so are the waves of Elliott.

Please keep posting APH - I listen and will follow as the future

unfolds itself.

(Sat Dec 27 1997 02:39 - ID#255284)
When you talk about Eris, you get Chaos & Discord
It's been happening to me too. fatal error, now if someone coudl just remove this knife from my back.....Rumurs of my death are accurate, however.
Is there a bot after us? hmmmmm malignant souls using a bot?

Plse try email me again

(Sat Dec 27 1997 02:41 - ID#347457)
@John Disney and Zulus cutting the wires
Are you sure it was Zulus, not Boers? ;- ) What a coincidence, I am just finishing Michener's book The Covenant, and no matter how accurate or wrong he was I think I have a better understending of South Africa history than I had before I read the book.

One of these days I have to go and see for myself.

(Sat Dec 27 1997 03:51 - ID#252127)
The Asians have gotten the message

Using a cheapened currency to import foreign goods that they really don't need, nah - I think not. They will use their currency to buy local goods at local prices.
It is a near certainty that Asian currencies will still be cheapened further, so their ( the peoples ) gold will be held. Knowing soon that the worldwide money spigot provided by the G7 will soon send to gold to new heights.

(Sat Dec 27 1997 04:03 - ID#393224)
Wake up goldbugs!!
OK goldbugs, it's time to get real!!

Gold is NOT going to $5000/oz
Gold is NOT going to $3000/oz
Gold is NOT going to $1000/oz--at least not for a helluva long time.

Realistically -- set your sights on $500/oz in the next few years. Anything else will be a bonus.

Now I suppose you want some reasoning to back up the above statements. The reasoning is very simple. Gold is not going through the roof because the powers that be WON'T LET IT!!! If you haven't yet figured out that your lives are controlled by your political and economic masters, then you are in for a rude awakening!! Gold is NOT scarce. It is extremely difficult to find, dig up and refine, but it is NOT scarce!! THEY have got plenty of it to use. OK--I know they have sold more paper gold than they have got physical to cover. Many "in the know" posters here have "reasoned" with us on that point. One very big fly in the ointment. THEY will change the rules when "reason" and hard reality prevail. Don't believe me?? Ask the Hunts!! You see, goldbugs, the race is fixed!! THEY have already decided which horse is going to win. Supply and demand will be allowed to prevail only as long as it suits THEM. Then the rules will change.

I am a goldbug just like most of you. What am I going to do??
1 ) Keep a handy supply of physical for emergencies. I mean BIG emergencies!! Use your imagination.

2 ) Trade gold shares. When gold goes from 300 to 500, I am going to make 1000. Makes sense to me!!

(Sat Dec 27 1997 04:08 - ID#393224)
WHO threw that cat into a flock of pigeons??

(Sat Dec 27 1997 04:48 - ID#398105)
From Kalgoorlie..............


Nick.........was it Rothchild. Have you ever tried to use a cat as a pillow?!

You may find the following address of interest:

Some of you may be interested in this International Conference. Last years forum may be sourced:

Hope you may find this of interest.

Aye, Haggis

(Sat Dec 27 1997 04:57 - ID#398105)
Kalgoorlie Diggers and Dealers Conference

Sorry lads, previous address failed. Try this one:

Happy reading.

Aye, Haggis

John Disney__A
(Sat Dec 27 1997 05:36 - ID#24140)
Hope This Works
To all

The first version of the spread sheet has been sent

to 20 people. It was written in word. From that and

the methodology I sent, you can readily set up your

own speadsheet.

I'd like to keep it all on one page, so if I add

something, Ill remove one on the list.

I would appreciate any comments or errors that

anyone picks up. Im sure I made some.

In many case, full info on reserves, ie proven,

probable, and resource is not available. Any info

anyone has on this would be useful.

Limitations - hedging is ignored. also time value

of reserves is ignored - all reserves all valued as

if they are available first thing tommorow morning.

Nonetheless, all mines are treated the same way. The

idea being to select between mines rather than decide

whether to buy a mine or say commercial property.

To compare between mines, I suggest you divide

the value of the gold ( at a given gold price ) being

bought when you buy a share of the stock by the

PRICE of the stock -

For example - with Beatrix with gold at 400 you buy

$21.65 worth of gold for $3.25 - a tasty ratio of 6.65.

With ABX at the same gold price, you buy $28 worth

of gold for $19. A ratio of 1.47.

Some mines look awful - echo bay,royal oak,resolute,

sons of gwalia, wes areas ( surprisingly ) , TVX, Homestake,

dbn-deep, amax.

I think all of these deserve a much closer look before

writing them off.

Some mines look outstanding. Wstn _deep,randfontein,

Harmony, goldfields, evander, Beatrix. These should also

get a second look.

John Disney__A
(Sat Dec 27 1997 05:46 - ID#24140)
Boer war and good advice.

For Nick

You are NOT wrong Mate. These things are to trade, make a profit,

and walk away from.

For Miro

I liked the Covenant a lot too. Mitchener was a big dissapointment

to me after "Tales of the South Pacific", but the Covenant gets a lot

of the flavour of the place. An account of Blood River is good for the old goosebumps.

If you want to read some other very good

stuff, read about the 1st and 2nd Boer wars - outstanding.

(Sat Dec 27 1997 06:41 - ID#398105)
farfel............Pegasus Gold, Mount Todd Project


You may find this of interest.


Aye, Haggis

(Sat Dec 27 1997 06:42 - ID#398105)
farfel............Pegasus Gold, Mount Todd Project


You may find this of interest.

Aye, Haggis

(Sat Dec 27 1997 06:43 - ID#398105)
farfel............Pegasus Gold, Mount Todd Project


You may find this of interest.

Aye, Haggis

Mike Sheller
(Sat Dec 27 1997 06:49 - ID#347447)
G'Day all
CMAX & ALL: Some very rough stats here, so bear ( you'll pardon the pun ) with me. CMAX inquired nite last about silver prices back before & during the Depression. My longterm Handy & Harmon wall chart ( on the office wall ) silver cash price, shows the following:

1920 $1.25

By end of 1932 silver was around .30

In 1935 was .80

Settles back to .45 by 1940

War raises price and stays just under $1 from 1951 to 1961

From '62 to '66 is $1.25

in '68 runs to $2.50

Back to $1.40 in '71

Then Nirvana! Goes from 1.40 in '72 to $50 in '80. Nice.

Don't quote me to the penny lads & lasses, but that's pretty much what the old chart on the wall says.

Mike Sheller
(Sat Dec 27 1997 06:50 - ID#347447)
Silver P.S.
Those Silver prices are based on Handy & Harmon MONTHLY Averages chart since 1920.

(Sat Dec 27 1997 06:59 - ID#432148)
Future Gold Price @Nick@C
If gold went up to $850 in short order in 1980 why can't it go to $1,000 in short order in 1998? Inflation adjusted it will be much easier next time. The powers that be ( govts and their CB gold supply of $336 billion value as pointed out by DigDeep ) can lose control and then gold can go much higher than $1,000. After all, what's $336 bil these days? Didn't the Korean govt just lose control? With handouts they are now trying to keep their nose above water. Soon the same thing may well happen in Japan, then what will the US and EU ( thru the IMF ) do? It looks to me we may well be on the edge. But then,
"they" may well be able to pull it out one more time. But not forever I fear.

(Sat Dec 27 1997 07:09 - ID#339320)

Schultz: Excellent 23:09 post!

Puetz: Ditto on your Fri Dec 26 1997 23:13 post.
Thanks for the response. It was so pertinent to silver
pricing fundamentals, I have taken the liberty of
re-posting it:

Cmax: The gold-silver rato during the 1930s is a
useless indicator of what will happen today. Gold was
fixed to the dollar, silver was not. Obviously, those
who wanted to escape the credit markets would
automatically go into the precious metal fixed to the
dollar -- gold. It happened in a big way.

Today, neither gold nor silver is fixed to the dollar.
They must trade off of their own merit. As money ( their
global scarcity ) , the ratio is about 7 times as
much silver as gold. That indicates that gold should
be about 7 times higher priced than silver. A
gold-to-silver ratio toward its lower historical norm
( 10-to-1 ) seems appropriate.

Myrmidon: Yes, my wife is also a fanatic about ancient Greek and Roman mythology.

(Sat Dec 27 1997 08:04 - ID#93130)
HAGGIS: You may find it of interest that Pegasus at the Denver Gold show about a month or so before the announcement of the Todd failure reported that it had its costs in line and expected Todd to soon come on line at a profitable rate. In addition, it reported good results from the Todd exploration. Presumably, based on this, a number of prominent analysts gave Pegasus a Buy Recommendation. Thus the announcement took the street by surprise.

(Sat Dec 27 1997 08:16 - ID#333131)
Fed data
Monday's Barron's shows custodial holdings of US debt down 12.5 B. Currency in circulation up 4 B. Total fed credit up 4.9 B. Monetary base unchanged as of 12/17. Will have to rise next week with rise in money in circulation.

(Sat Dec 27 1997 08:18 - ID#364147)
@ The Meadowlands
GO GIANTS!!!!-------------------------Lakers suk~~~~

(Sat Dec 27 1997 08:49 - ID#333131)
Political turmoil in Japan. Hashimoto rumored to resign in Jan.

(Sat Dec 27 1997 08:55 - ID#398105)


An issue which may have been important concerning Pegasus was the nature of the financial agreements in place with the Banks. Trouble started the weekend that the gold price touched below US$300, therefore there may have been a clause within the financial agreements. Couple this to poor production performance, and "Bobs your Uncle". Pity.

Aye, Haggis

(Sat Dec 27 1997 08:58 - ID#333131)
Russia "Nobody knows the ruble I've seen" "We've ceased to believe anything they say."

(Sat Dec 27 1997 09:07 - ID#30116)
larryn__A -- I was surprised when I created that ( yield ) chart. Something is going to break, and soon. Somehow I get the feeling that it will coincide with some unfriendly announcement or event. I admit that I haven't got a clue in that regard, just speculating as to what the 'event' might be. It could be that the 'event' has already happened ( Asia debacle ) and that the market is slow to respond to it.

(Sat Dec 27 1997 09:08 - ID#30116)

(Sat Dec 27 1997 09:11 - ID#333131)
Do you have State Farm insurance. Did you know you are paying for Clinton's defence?

(Sat Dec 27 1997 09:32 - ID#427357)


Long-time veteran precious metals analyst starts his report with a Point & Future chart of LONDON GOLD, going all the way back to 1980. It clearly shows a TRIPLE-BOTTOM at about the $280 level ( 1982, 1985 and the present ) . The last two times it reached Dines Buy Zone, the yellow zoomed to the $500 area:

John Disney__A
(Sat Dec 27 1997 09:46 - ID#24140)
Sunday Morning going down
Some Quotable quotes for That Sunday Morning Flavour -

"When Mandela dies we will kill you whites like flies"

remark attributed to metro councillor Mzukisi Gaba

when he was arrested for drunken driving.

"Hansie doesnt even tamper with his own balls in the

shower" - attributed to DJ Mark Gillman in reference

to false allegations of ball tampering by SA cricket

Team Captain Hansie Cronje.

"We kill more Americans with our own land

mines than we do anyone else" - Former US Marine Commander General

Alfred Gray, on the use of Landmines

"just answer the bloody question- you snivelling

little lying bastard" - Australian Opposition trade

spokesman Peter Cook to Asst Treasurer Rod Kemp during

a Parliamentary treasury committee meeting.

" A hurricane wouldn't stop Jackson's erection" -

Publicist for michael Jackson's RSA tour, when asked if

bad weather would prevent the huge statue of Jackson

from being erected.

(Sat Dec 27 1997 10:01 - ID#427357)

Rick Ackerman regularly contributes market analysis to the Sunday San Francisco Examiner and has also written numerous times for Barron's. Presently, he is bullish on GOLD, and VERY bearish on common stocks.

He observes The result has been the creation of a global credit bubble that is about to collapse and take the stock market with it. The size of the bubble is the reason why the market will not return to health with the 10 to 20 percent correction that nearly everyone on Wall Street seems to be hoping for.

Somewhere down the road, when share prices have been cut in half, the excess of the credit system will be cited as the cause of the collapse.

Most likely, gold stocks, bullion and long-term Treasuries will be the best place to be, along with some foreign debt instruments. But don't count on being able to shift your money when the trumpets sound, for there will be no time then.

Detailed comprehensive report at:

(Sat Dec 27 1997 10:04 - ID#410114)
Silver 1932 to 1980 gold 1932 to 1980
It is interesting to note that silver was dumped on the market by the US Gov't earlier in this century.

After WW II, there was an 18% inflation in goods and services dispite the fact that silver coins and dollar bills were interchangable with each other.

I am wondering weather there is any significance to the situation these days?

(Sat Dec 27 1997 10:06 - ID#93232)
If my memory serves me correctly, and now I recall it seldom does...somewhat damaged by 40 acres of grass during college...I didn't inhale.....and a limited intake of peyote....but I didn't swallow it....anyway, Mike said Monday is "bad bongos" day for Wall Street. He also said there will be a two day period in January that skies will darken for the "blue sky" boys. I am prepared for all hell to break loose...Did Woody Allen marry that little asian chick, or what?

(Sat Dec 27 1997 10:12 - ID#93232)
Very good post below on Russia...thanks....I notice Paul McCartney doesn't live back, back in the USSR.

(Sat Dec 27 1997 10:14 - ID#427357)

There is no doubt that this is seasonally abnormal; there's also
no doubt of what can happen if Japan breaks the key
levels ( basically 14,400 or so in the Nikkei ) and doesn't bounce
back immediately. Such an event would travel around the globe,
flattening Europe in all likelihood, then creaming New York
thereafter. Views of what the New Year might ring in:

(Sat Dec 27 1997 10:20 - ID#93232)
What in the hell was "Werner" Von Nobraun speaking to yesterday? I just read all that.

(Sat Dec 27 1997 10:27 - ID#31868)
I have been in the tequila-induced dream world, immersed, traveling though the post cognitive palimpsest of the spirit world. Sleep travel with a tequila passport and a handful of peyote acting as payment to the spirits. Reemerging into the foggy world of reality is once again an Olympian task of comprehension.

The puny Norsemen come to do battle in the land of Giants. They will be thrashed, sent home with broken horns and dent creased helmets.

Let the battle begin.

John Disney__A
(Sat Dec 27 1997 10:28 - ID#24140)
To all

before any Dbn deep shareholders faint at the

spread sheet forecast for DD, the loss posted for

the group was the first time the 3 companies - buffels,

blyvoor and DD have reported as a group - lets wait

for their year end results - in the 3rd week of


In the meantime - change the "avg price for period"

to 325, and the eps to -.25. This makes a huge change

in the value of the stock. we will be using the 3rd

quarter only - the first consolidated results.

Ddeeps will be outstanding BUT it needs 350 and ounce. Otherwise

it suffers. The Spreadsheet now says -

With gold at 400$, $1.6 for DD buys you $115 worth of gold profits

$2.72 for Harmony buys you $76 worth of gold profits

$1.75 for Evander buys you $66 worth of gold profits

(Sat Dec 27 1997 10:34 - ID#398105)

I think that Werner had been on the Internet and had agreed to marry a total stranger from another planet!
Aye, Haggis

(Sat Dec 27 1997 10:36 - ID#31868)
The lead in should have read!
GO GIANTS! he said wearing a Sombrero with a face mask on it.

(Sat Dec 27 1997 10:37 - ID#93232)
So the Woodster marries his daughter...I knew he would make it right. Good man. The medieval surplus store doesn't open here until 10:00', I'm goin' get me a Kevlar suit of armor, made by Orvis. Then I'll be there.

John Disney__A
(Sat Dec 27 1997 10:37 - ID#24140)
A small town in Normandy called d'Isny

For tolerant

Our horns never break nor our helmets crease - pay us our gold and

we sail on ..... otherwise ...

A racial memory of the long ships, the smouldering villages on

the shore, the skull drinking after.....

Pass me the peyote, buddy.

(Sat Dec 27 1997 10:43 - ID#93232)
@aye, Haggis.....
Rocketman Verner is the first man to go to Pluto and not come back. He likes it there...barren, damn barren.

(Sat Dec 27 1997 10:44 - ID#333131)

(Sat Dec 27 1997 10:45 - ID#333131)
She's not his daughter. She's his daughter figure.

(Sat Dec 27 1997 10:47 - ID#427357)
STUDIO.R ( @vronsky? ) ref: " What in the hell was "Werner" Von Nobraun speaking to yesterday? I just read all that."

I do not have the foggiest! I do not know him, nor have I ever corresponded with him.

(Sat Dec 27 1997 10:50 - ID#427357)


Long-time veteran precious metals analyst starts his report with a Point & Future chart of LONDON GOLD, going all the way back to 1980. It clearly shows a TRIPLE-BOTTOM at about the $280 level ( 1982, 1985 and the present ) . The last two times it reached Dines Buy Zone, the yellow zoomed to the $500 area:

Bill El Zebub
(Sat Dec 27 1997 10:52 - ID#261352)
Gold moves higher prior to market collapse and falls with the market?
Historically correct? Should we play the rally of our precious and
convert profits to put options. Then throw it all back into our baby?
Are index puts harder to deal with the individual stox puts? Any recommendations?

(Sat Dec 27 1997 10:54 - ID#31868)
John Disney, STUDIOR
Gadzooks boys. Kevlar will be no match for a tequila hardened straw Sombrero. And the Vikings were fools to drag that paltry ship by rope across land from Minnesota to the battlegrounds of the Giants where swirling winds and the fine stench of $850.00 hotdogs fill the air.

I love the smell of rope burns in the morning. It smells like, like victory.

If they had only heard of the wheel he muttered and chuckled under his heavily tequila laden breath. heehee, hiccup

(Sat Dec 27 1997 10:54 - ID#333131)
The Dines monthly point and figure chart of gold you posted is a beauty. Thanks

(Sat Dec 27 1997 10:56 - ID#344308)
@-----4 days and counting-------

sure hope you removed the strychnnine laced outer covering
before par-taking.

'breathe deep the gathering gloom, watch lights fade from
every room' --------moody blues

the lights are going OUT this next week for stocks. i've
ridden this damnable limb for 3 weeks with support only
from the tree of knowledge.......

time is short, the ink is flowing......the ink tsunami will wash
upon all shores with indifference to the greetings....AYE

cherokee!;--eya---physics dictate a MAJOR CONTRACTION....immutable

(Sat Dec 27 1997 10:57 - ID#398105)


I think that we may have been unfair to Werner. Perhaps he was telling everyone on the Internet that is in therapy. Doing this on the Internet IS the best way to announce it.
Aye, Haggis

(Sat Dec 27 1997 11:00 - ID#31868)
But of course my friend. I was born at night but it wasn't last night. hiccup

(Sat Dec 27 1997 11:00 - ID#398105)
Studio.R...............Werner..................a missing link


I think that we may have been unfair to Werner. Perhaps he was telling everyone on the Internet that HE is in therapy. Doing this on the Internet IS the best way to announce it.
Aye, Haggis

(Sat Dec 27 1997 11:02 - ID#427357)

The key to financial independence is to know who will win the hidden battle between the U.S. dollar and gold.

International Econo-political analyst shares his critique of Kutyn and Milhouse financial opinions of the Southeast Asian currency crisis, stock market meltdown and crumbling banking systems vis--vis George Soros "REFLEXIVITY" THEORY. Truly an intellectual erudite analytical work. See:

(Sat Dec 27 1997 11:06 - ID#333131)
point and figure chart from Dines
Strike "monthly", duh

(Sat Dec 27 1997 11:07 - ID#411149)
John Disney- I sure would like a copy of your chart.


(Sat Dec 27 1997 11:13 - ID#93232)
@cherokee...the literate tribe......
Glistening in the morning sun, are the cold, merciless points of samurai blades 'neath ...standing, awaiting, beckoning ...the last sinews of the limb to give way....don't make the slightest move. Brave warrior, you are.

(Sat Dec 27 1997 11:29 - ID#254269)
@ vronsky ; your 11.02

Mayeb the battle between the US Dollar and Gold will not have a

decisive outcome; perhaps it will only be a draw for both sides but

with price movements which will allow for trading profits.

(Sat Dec 27 1997 11:29 - ID#93232)
@yo! Haggis......aye, yo.....yo, aye...tomato....potato...let's say it's just a.....
My dear and only brother lives across your island in Me'burne...will you kindly go whip his arse for me....I think he's worn the sweater he sent me for Christmas. If you should meet him, be comforted, he's the sane one in my bunch. Now, How may I help you?, my friend.

(Sat Dec 27 1997 11:36 - ID#35767)
Gold stocks
They say there are 4 billion ounces of gold above ground. But isnt most of this in jewelry which could not be profitably converted into Troy oz gold at these prices. Thus, this fact along with the gold loans means the actual supply of tradeable gold is decreasing.

Re Gold wars: Why does everyone think that the world will cooperate with the IMF and US dollar dominance. I think the opposite will occur.
Further is it in CBs interest to drive gold down from these levels and thus cause potential defaults on their massive gold loans. Such would not seem to be in their interest IMHO.

(Sat Dec 27 1997 11:59 - ID#22956)
Checking in before knocking around visiting Rug-Rats......
Ted - burrito wafting.............go Giants!!!! uh.....lakers....chalk up ANOTHER kill...ohmy!

Nick@C - Yes. I agree. Some here are getting their knickers in a bunch over the commodity gold. 5,000/oz??!? hmmmmmmmmmm.....I think not.....400, 500.....maybe, probably. 1,000...2,000? the me crazy. And throw a shrimp on the Barby h M!

Tequila1 ( at tolerantville ) - You seem to have gulped one too many worms....... ( smiling languidly and staring at the ceiling for no apparent reason )

now it's time to go back to playing with the crazy head hurts.

btw, I played 18 yesterday and got sunburnt....I love Cal in the winter ;- ) .......My new bubble shaft does too.......300 yrds down and dirty...uh huh.

away to watch gold dive under 300, eh d.a.??


(Sat Dec 27 1997 12:03 - ID#426220)

- FRB Top-Dog Shares His Candid Opinion On Gold

- Greenspan: Still Going for the Gold

Once at the following website, scroll down until you see Mr. Greenspans bright-eyes peeping out at you, then CLICK him... where ever you like. IF you do NOT see Greenspans photo, RELOAD THE PAGE:

(Sat Dec 27 1997 12:09 - ID#426220)
Carl ( point and figure chart from Dines ) "Strike "monthly", duh" Oooops, sorry ol' buddy, I lost my head. Many thx for the correction.

Mr. Mick
(Sat Dec 27 1997 12:19 - ID#345321)
Tolerant1 - THE GIANTS WILL FALL!!!!!!!!!!!1
The Viking's are overdue for a championship. GO Vikes!!!hahahaha!!!

(Sat Dec 27 1997 12:25 - ID#270224)
Disney please e-mail data to

(Sat Dec 27 1997 13:05 - ID#344308)

denver will win the super bowl----------imm

for the last year i have damned-near begged people to consider
gold and silver call options as investment vehicles.

silver calls, 650 strike are worth approx $2.5k+......
they were being sold ( 3 months ago ) for $150.00 each.

gold calls are still dirt cheap......july 340 calls are $10.00 EACH...

THEY said it was impossible for silver to increase in price....
what happened? what are THEY saying about gold?

are gold calls worth the gamble? $60 to control 100oz? hell yes....
the money in the account tells the story of the silver calls.........

my calls-------eurodollar puts
peso puts
c$ puts
S&p puts
mmi puts
dow puts
nasdaq puts
gold calls
platinum calls
palladium calls
crude oil calls
heating oil calls
corn puts
soybean puts
oat puts
bond puts---donald_a's fault!!!; ) glad to have 3 @ 112!!
these are test vehicles...done for all to see...giants...

all should be bought as far into the future as finances allow.

now--------who else dares to test the timbre of the limb????

cherokee!; ) --driver-of-the-smoke-signal-mobile--grab-a-seat--if-you-dare-

(Sat Dec 27 1997 13:10 - ID#426220)

Noted ORACLE OF HONG KONG, Milhouse, provides yet another astute and insightful critique of the Nippon Financial Malaise. Milhouse is decidedly bearish, and feels the Nikkei is going to get a lot worse before it gets better!

In Japan, the economic recession continues relentlessly. Furthermore, major falls in the stock market appear very likely in 1998, wiping out whatever capital remains in the troubled Japanese institutions.

I believe there is a greater chance that the Japanese people will start accumulating GOLD to protect their substantial savings...

Milhouses clear-sighted and perceptive report may be found at:

(Sat Dec 27 1997 13:12 - ID#36965)
I agree agree with you oh purveyor of wisdom except in one respect. Put San Francisco where you have Denver and you will have a clean sweep.

(Sat Dec 27 1997 13:27 - ID#426220)

Coming off the brilliant SILVER CALL recently, Mike Sheller shares another insightful and quite possibly prophetic outlook for the stock market and precious metals. This will be, if nothing else, a "stress test" of sorts for the stock market. As he sees it, between his calculations and our Jupiterian observations, stocks don't have a chance. Full view from observatory at:

(Sat Dec 27 1997 13:30 - ID#432298)
Superbowl winner.......
The Green Bay Packers will win the Superbowl again, with the great arm of quarterback Brett Favre.

Gusto Oro
(Sat Dec 27 1997 13:52 - ID#377235)
Cherokee, am I right in saying that the July 340 gold calls merely expire worthless if gold is 340 or under in July but gain value from 341 up? Would like to hear more about the gold and silver calls & would appreciate a further post on this thread or an e-mail from you on this subject. Thanks. --Alan

(Sat Dec 27 1997 14:05 - ID#22956)
As long as we are making our Stupor-Bowl Predictions..........
It will be Kansas City Chiefs..........all the way...although the Packers are a gooooood choice also......Denver will choke and S.F. will is that for covering bases??

and Cherokee.......I will try to mail you some cool spreads for you to, seriously.......and you forgot the D-Mark is forming a NICE 'pennant' ( goto daily Mar Dmark ) ...and the Dec is a straight line ( what would kr say to that? ) ...ohmy.

...and if you think that next week will be baaaaaaaad for the Stox then the flight will be to the Mark ( not gold ) ...imo. It will go one way big and I think it will be up, UP, and.....

AWAY!!!!!$$$!!!$$~~~~~~~~~~~~~~~go Chiefs ( arrows flying all over the place in Kansas, thwock! Thump! Klunk! ) ...uh huh.


(Sat Dec 27 1997 14:22 - ID#285309)
Debt Financed Economic Miracle
South East Asian economic miracle has been finance by a mountain of debt and now is imploding. This explanation for the Asian crises is being mentioned more often these days.
The US debt ( on-books only!! ) has increased from about $500 billion in 1979 to about $5,500 billion today, an increase of 11 fold!! I then would say that the US prosperity has also been financed by a mountain of debt and is going to collapse as well.

(Sat Dec 27 1997 14:25 - ID#22956)
July Gold Calls??!?
I do not think that gold options are an option in July... but June options do exist. Correct me if I'm wrong...

Gusto - 340 WILL have good value if the price is at or just under 340 at expiry....but...........the better play is Buy two ( or three depending on aggressive nature ) out-o-money calls and sell one in-the-money call. This is the classic bull-call-spread. Use April or any months ( the first three months ) that have 5 dollar increment strike prices. If gold reaches 340 you will have made FAR more money on the 'run-up'. Call your brokerage house and ask to speak to the options dude.

...........but I would wait.........they will be cheaper ( smile ) .... the nieces and nephews


Gusto Oro
(Sat Dec 27 1997 14:26 - ID#377235)
Coins & Bars Discussion...
Flip over to the Coins & Bars Discussion thread and see Santa on his way : )

(Sat Dec 27 1997 14:26 - ID#26793)
Inflation or deflation?
Digdeep made a good point last night about total holdings of Central Banks being 35,000 tons and having a total value of $340 billion at current prices. There was a lot of discussion about what the price of gold would be in the future with numbers offered from $250 to $30,000 per ounce. I have always tried to ignore gold price discussion and prefer to talk about the value of gold.

The price is different to each person on the site depending on his home currency. The value of gold is something to which we can all relate. How many ounces to buy a Chevy, or an acre of farmland, or a loaf of bread, that is what we all hope to do with our gold at some point isn't it?

As Greenspan said only a month or two ago, governments have the ability to print unlimited amounts of currency and the general feeling on this site is that they will do that. Those of you who feel that way I place in the inflationist camp. There is a smaller group here who think that deflation is in the future. I belong in that group and I would like to take the point made by Digdeep and the point made by Greenspan to try and prove the deflationist case.

Digdeep says the gold is worth $340 billion. Greenspan says we can print unlimited amounts of cash. So why doesn't Korea, or any other country solve its problem by doing that today. Start the presses rolling tonight; print $340 billion worth of Korean won and buy all the gold on hand. The reason they do not is because they know that no one will sell it to them. I won't sell mine, you won't sell yours and Greenspan won't sell his.

All of us, Greenspan included, KNOW THAT THE VALUE OF THE GOLD IS WORTH MORE THAN THE $340 BILLION CURRENT PRICE. We are right back to that price versus value point I made earlier.

Now let us take the argument further. Greenspan says that governments have the ability to print unlimited amounts of cash. Is he correct? If his statement is true why did Korea not print won in unlimited amounts to solve its problem? The answer is that Korean won can only be spent in Korea. The won can not be used to pay bills that come due in dollars. Korea needs oil and other commodities that are not available locally and it has borrowed dollars, not won. While it is true they can print unlimited amounts of won it is useless to do so for things purchased abroad. The same argument holds for any other country except the United States. How then can Korea obtain dollars to pay for its imports? It can only build products that can be sold for dollars. To do so it must compete by offering better products at a lower dollar cost than other countries that also need dollars. Just as the United States has for years been said to have "exported inflation"; countries around the world will begin to "export deflation".

I think that automobiles make the cleanest deflation example. The devaluation of the Korean won by 50% in recent weeks allows them to literally cut the price of the car in half in dollar terms while booking the same price in terms of the Korean won. This is not good news for Detroit. Products of American car manufacturers now become overpriced both here and abroad. American automobile workers face layoffs reducing their ability to purchase even the half-priced imports from Korea. Some will lose their homes. Those homes will be sold into a declining real estate market along with the homes of other downsized auto workers. Downsized and laid off workers no longer qualify for credit and often are forced into bankruptcy. Losses by banks due to failed mortgages and defaulted credit card customers cause them to tighten credit standards. Those tightened credit standards further reduce the ability of the public to purchase the now half-priced Korean cars. Korea, under pressure for more dollars, reduces the price even further either by a new currency devaluation or reducing the pay of local Korean auto workers or both. Thus the spiral downward continues into another cycle of still deeper deflation.

I do not expect the UAW or the American Automobile Manufacturers to stand idly by while this happens. We will hear calls for a cheaper dollar and import quotas or a total ban on imports. Let me accept the point of the inflationists and agree that the dollar will be cheapened by printing. How will these new dollars be delivered to the people who need them? World Trade Organization rules, originally demanded by the U.S., forbid a subsidy by any government to the auto manufacturer. We will not pack them in a box and ship them to the needy former auto worker.

I can think of no way to do it. If a way could be devised the foreign holders of U.S. Treasury securities, the same ones who sold gold to invest in U.S. Treasuries will begin to sell treasuries. Interest rates will rise as Treasury competes with other borrowers by offering higher interest rates. As credit card rates and adjustable mortgage rates rise it causes more defaults and foreclosures by those at the margin. Distressed properties hit the market and prices decline during a glut of foreclosures. Again, even though an attempt was made to inflate, deflation is the result.

As I said the other day, gold competes with interest rates. How much do they have to offer you in interest to give up your gold? The answer, as in the earlier argument, depends on where you are and what currency you use. It also depends on the credit quality of the person, corporation or government who wants to entice you to give up your gold. You must always remember that is the choice you are making. Gold pays no interest but provides ultimate safety. Offers of interest are nothing more than enticements to give up your gold. That is as true today as it has ever been. It doesn't matter if you are an individual or a Central Bank.

The holder of gold does not need to think about whether the future is inflationary or deflationary. He is concerned with value, not with price. Price only introduces an annoying tax consideration when the gold holder is ready to convert his gold to the Chevy, the farmland, or the loaf of bread. If he has experienced an increase in price he owes taxes. If there was a decline in price he has a tax credit. Whatever the outcome, inflation or deflation, the value of the gold is constant.

(Sat Dec 27 1997 14:28 - ID#411149)
cherokee- what would the July 340 calls be worth @350 ,400, 500 gold?


(Sat Dec 27 1997 14:30 - ID#333131)
IMF and Gold 103 million ounces. policy. I'm sure SRDer had posted this but I hadn't seen it.

(Sat Dec 27 1997 14:50 - ID#333131)
Donald, Government printing of money
A government does not just print money. They must somehow force their people to use it, that is, to accept it in exchange for goods and services. The main way this is done is to tax in that currency, so citizens must accept it in order to pay their taxes. Don't try to pay your US taxes in gold ( not that you would ) . The large debt load existing in US dollars ( denominated ) assures a ready "market" for dollars. I don't think the same would be true of won.

(Sat Dec 27 1997 14:50 - ID#22956)
gold calls
go here...if you don't have software:

you will not see JULY options...because they do not exist...



(Sat Dec 27 1997 14:57 - ID#288155)
Donald, the Silver Keyboard Award...

"The holder of gold does not need to think about whether the future is
inflationary or deflationary. He is concerned with value, not with price."

Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes, Yes...

My brothr Cherokee has affected ( infected? ) my behavior ( this in the
90's paradigm of "it's not MY fault..." )

(Sat Dec 27 1997 15:09 - ID#348129)
This makes me LOL: I notice on the IMF Gold page that they sold 50 million ozs. of Gold between 1976 and 1980 at rock bottom prices, just before the all time highs were hit.
They are now talking about voting in Aug/1998 to sell more of their holdings. What does this tell us??? HaHaHa - Go Camdessus

Auctions and "restitution" sales ( 1976-80 ) . The IMF sold approximately one-third ( 50 million ounces ) of its then-existing gold holdings as an outcome of an agreement by its members to reduce the role of gold in the international monetary system. Half of this amount was sold in restitution to members at the then-official price of SDR 35 per ounce; the other half was auctioned to the market to finance the Trust Fund, which supported concessional lending by the IMF to low-income countries.

(Sat Dec 27 1997 15:19 - ID#252150)
Miro@ your 0227 re: Roman Empire compared to
U.S. You stated that the Roman Empire was strong militarily until it's demise. I have some facts & dates.It is conventional to date the wavering decline with Comodus ( 180-92 ) . Rome was sacked by the Visigoths in 410 & taken by Gaiseric in 455. The state disintegrated & the Romann Empire in the West ended when Odoacer deposed the last Emporer, Romulus Augustulus,

in 476. As I stated in my post the Roman Empire had been weakening militarily for centuries & could hardly be compared to the U.S who since the ending of the cold war has reached her zenith.

BTW, I'm a Canadian, & do I think that the U.S. would use her military superiorety to ensure a supply of cheap oil? Did'nt they already prove that in 1991? I think it's naive to think that the greatest power in the history of the world will just fade away. I would'nt rule out pre-emptive attacks against any real threat to their hegemony, including China. Israel ( the U.S.'attack dog in the mid east ) has already said that they are not going to stand by & let Iran develop nucleur weapons. It has been said that "he who has the gold rules". I would ammend that to...he who has the strongest paper & most powerful military rules.

(Sat Dec 27 1997 15:19 - ID#288155)
Banking: Merrill Lynch to set up retail network in Japan
By Gillian Tett in Tokyo

Merrill Lynch, the US investment bank, plans to become the first
non-Japanese group to set up a fully fledged, independent retail brokerage network in Japan. It could hire 2,000 staff from Yamaichi Securities and use some of the former branches of the broker which collapsed last month.

Merrill Lynch hopes to establish about 50 brokerage outlets in the middle of next year to sell its investment products directly to Japanese clients for the first time.

Its plans mark a significant expansion of the role of western asset managers ahead of Japan's Big Bang deregulation in April, and a competitive threat to Japanese brokers.

(Sat Dec 27 1997 15:25 - ID#28585)
HAGGIS...PEGASUS looks like great spec play at 5/8...
It is simply not in the interests of the Australian bankruptcy administrator to liquidate poor ol' Pegasus Australia...they will end up with one or two cents on the dollar at best. The banks know that Pegasus Int'l still produces gold at other mines so that ultimately they can get their money back ( or even make profits ) if gold heads North of 400 someday. However, this requires they keep the ENTIRE company alive and viable...after all, if they confiscate Mt. Todd, who would want to buy it today....absolutely nobody! Moreover, if they seize and liquidate other Pegasus gold mines, again, who wants to buy them...they are all operating at effective losses at current gold prices. Even if they could find buyers, nobody would pay the banks anything near their potential worth.

I predict they will summarily fire and replace this Nennecker dimwit and the banks will reach an accomodation with the "new company" that involves transforming a good portion of Pego's debt into equity...the very same work-out that Sunshine Mining used with it's preferred shareholders and bondholders about a year or so ago. The work-out announcement alone would bump the Pego equity up to at least $1.00 -1.50.

If you recall, Sunshine equity traded at 1/2 a dollar not so long ago. In spite of equity dilution exceeding 200 MILLLION SHARES, today, Sunshine trades at 1 & 1/16...headed for 2-3 bucks if silver breaks over Seven dollars an ounce ( sure looks like it ) .

Bottom line: I love to see situations where the shareholders are gripped with abject fear, fomented and catalyzed by the vulture investment boys.

DAT'S A HOW I MAKEA DA BIGGA BUCKS ( har,har, har ) !!

(Sat Dec 27 1997 15:28 - ID#288155)
Meanwhile, on the labor side....
Trade unions: Approaching the new year with resolution
By Robert Taylor, Employment Editor

Next year will be "the most important for the trade unions since the 1970s" and promises to herald a restoration of worker power in the UK. That is the belief of John Monks, the Trades Union Congress general secretary in an interview with the Financial Times on the outlook for 1998.

"By the spring we will have 10 separate pieces of government legislation going through the parliamentary process which are pro- worker", he says. "Many union leaders still don't seem to realise just how much this government is promising to implement."

Mike Sheller
(Sat Dec 27 1997 15:30 - ID#347447)
That's why he's THE Donald
Brother Donald makes a solid and continued case for deflation. He is a formidable defender of that view, and while I am intuitively in the inflation camp, I must admit that exposure to his arguments, along with that of Steve Puetz, has opened the door wide in my mind to that point of view. My only puny point in this "Sabado Gigante" of great minds at kitco is that I feel excessive credit and money creation, while the cause of this whole fiasco, will be the initial attempt at the cure. At the risk of being tiresome, I reiterate the Rothbardian/VonMisian observation that the new money and credit always goes to the favorites of government. The big question we must all ask is what is the best thing to do with all that money ? If each one of us Kitcoites was a central bank or institution receiving new money and credit in the teeth of a financial collapse, what would be the best thing to do with it? Perhaps the day is over, and the timing too abrupt, to find a way to funnel this money into the hands of "the people." Perhaps the people will have to be sacrificed. If that is believed by institutions receiving the new money, where can they put this money so it benefits THEM, and the preservation of the value of the money? Yes, most of us would put it into something shiny and yellow, and highly malleable. We know that. But are Central Banks and modern financial institutions psychologically ready for that? Will THEY drive gold higher, or will they follow along only when other classes of buyers drive gold higher. Which is the tail, which is the dog? Is there anything else besides gold or another currency ( may be a limited option at some point ) that would appear to make sense ( rightly or wrongly ) to institutions. If we can ascertain what that might be, then there is the asset that will receive the "inflation." If nothing else can be arrived at, then is it, in the end, gold and only gold? I am wondering these things. But I also sleep at nite. ( ;- )

(Sat Dec 27 1997 15:35 - ID#288155)
While others scramble to accumulate the REAL 'stuff'...
Mining: Lonrho expected to offer up to 300m in JCI bid
By Andrew Edgecliffe-Johnson

Lonrho, the restructuring UK conglomerate, is expected to offer between
250m and 300m for JCI, the South African mining group, when it publishes its formal bid terms in the new year.

The offer is likely to be struck at about R24 ( 290p ) to R25 per share,
compared with JCI's closing share price on Wednesday of R22.40.

Although it announced it was in takeover talks with JCI at the start of
December, Lonrho will be unable to unveil formal terms until next month
because the deal depends on an agreement between JCI and Anglo
American, the South African mining group.

Lurker 777
(Sat Dec 27 1997 15:41 - ID#317247)
It could happen! Why not? Who say's? Told you so! WOW
How about those Dec 98 340 calls @ $400 ea.

If we retest the low $280s we should be able to pick them up for $300. Buy 10 for $3000. plus $300. for commissions. Sell 2 when Gold hits $360. and your playing with their money.

Your Gold Profit at:

$ 400. - $ 48,000. Easy

$ 500. - $ 128,000. 1996 high

$ 800. - $ 368,000. 1980 high

$ 8,400.- $ 6.448,000. Miller @ Vronsky

$30,000.- $23,728,000. Puetz ( you got to love this man )

(Sat Dec 27 1997 15:46 - ID#333131)
Hooked on paper test
How many people on this site ( even here ) think in terms of making a paper profit on a rise in "the price" of gold? ( Donald and Another, you're excused from this test. ) Why are we breathlessly waiting for a collapse in the gold price of $'s instead of praying that it remains high so that we can buy cheap gold as long as possible? The fiat paper hook has been sunk deep and will not come out painlessly.

(Sat Dec 27 1997 15:47 - ID#426220)
Yesterday GOLD-EAGLE was contacted by a director of the Korean Futures Exchange ( KOFEX ) in SEOUL, Korea. He informs that KOFEX will shortly begin operations. One of the first contracts to be traded will be GOLD FUTURES.

Are there still any "Doubting Thomases" about GOLD's importance to the world... and especially the great significance and affinity the yellow metal holds for Asians?! South Korea is close to absolute and total bankrupcy... nonetheless, a new Futures Exchange will shortly be trading GOLD FUTURES. I WOULD INDEED BE REMISS were I not to mention that - IN MY CONSIDERED OPINION - most probably not a few of the $57 Billion rescue package, promised by the IMF, will inevitably find their way into GOLD FUTURES traded on KOFEX.

(Sat Dec 27 1997 15:51 - ID#344308)


how about those GIANTS?????????

send'em with the oilers!!!!!

(Sat Dec 27 1997 15:52 - ID#238295)
APH: Your projection of a first quarter gold retracement and the crucial importance of XAU behavior during that drop coincides with my own thinking. If XAU holds up well, that will signal the best year for gold and gold stocks since 1993.

To those who argue that the CBs will forever be able to keep the yellow at bay, I say this is true only as long as investment demand stays depressed. Once investment demand takes off for whatever reason, the shorts will be massacred no matter what the CBs do or don't do.

(Sat Dec 27 1997 15:56 - ID#426220)

Internationally acclaimed financial analyst shares his latest brilliance with the GOLD-EAGLE readership. A few cardinal excerpts:

We are currently witnessing one of the greatest events in world history, a total and complete economic collapse.

...Korean Banks have borrowed billions of U.S. dollars. The collapse of the won has resulted in major foreign exchange losses for the banks. Bankrupt borrowers and large foreign exchange losses will lead to the failure of most banks in Korea.

The IMF cannot alter the financial collapse of South Korea. Every
dollar lent by the IMF will be used to bail out a foreign lender. That is all. It replaces private debt with public debt. It does not alter the financial strength of Koreans' Bankrupt Companies.

Japan is in the same boat... only the Nippon boat is FAR LARGER! KUTYNS full report at:

(Sat Dec 27 1997 15:57 - ID#31868)
the taste of humble pie, Cheers to the Vikings!!!

Humble Pie is at my table setting. My big mouth and me will take huge bites and I will be better for having eaten it. I shall savor each morsel.

Cheers to the Vikings. May they continue to win and go to the show and win it all. Time to take the face mask off the tequila Sombrero.

My brother the Vikings fan has just called from West Virgina, his inlaws insisted on it. Fresh baked humble pie from the great state of West Virgina.

Now where was I?

Oh, but of course. I have been staring at the ceiling too long.

Get Camdesuss!

(Sat Dec 27 1997 16:09 - ID#344308)


you are correct--------july----june calls.....i stand admonished
and it should be.

now about that wart on your eyelid.....!; ) just funnin dude---

1000k in '98--------war-cry-and-new-years-resolution-for-this-tribe----

denver flying high--------ssm leading the way------------

---ta-way-to-b-e-with-eya-and-the-limb--------------cherokee!; )

(Sat Dec 27 1997 16:11 - ID#344308)

you speak of the one of the great bands of ALL time---


30 days in the hole, oh yeah, 30 days in the hole...the good old days!!

(Sat Dec 27 1997 16:11 - ID#301318)
Lookin' From the Bottom Up (or A Meager Synapse)

As a small street working stiff I am having convulsions wondering where and how to invest for the next 4-6 months. All I hear about is the coming deflation but all I see is inflation. The cost to keep my car on the road is going up not down. I shop at Wal-Mart now ( lots of cheap cloths and household items ) . CNN just had a blurb that airline tickets in '98 will increase up to 6% as will car rental and hotel rates. My real estate agent says get in while the goin's good, "interests rates will rise after this current dip". My property tax rate cut is so meager that the increase of its supposedly assessed value actually increases the tax every year. Cable TV rates up. Energy bills up. It cost me a big chunk of labour to fix my heater where as the part that needed to be replaced ( imported of course ) was a small fraction of the entire bill. God forbid my car gets sick, car parts are as expensive as ever, no price break here.

The argument ( IMVHO ) is what proportion is the deflated price of imports compared to inflating price of domestic goods and services and how much will that relationship change in the next few years as well as how many jobs will be displaced?

The company I work for is constantly aware of any excesses it can trim off its expenses. Soon my office will disappear and I will work from home. How far will they go? Next it may be my job for cheaper remote labour can be had abroad! After that what else is left to cut? My throat!

The above average salary can barely pay the monthly mortgage payments for the average cost of a house. It requires a solid dual-income household just to have anything left to save for retirement. That's the rub. If our 401K lay's a massive dump, millions of Americans will be looking' for the reaper. And the g'ment knows it. What will they do? Save Japan at all costs and at what cost to me?

This years g'ment's unexpected ( B.S., they knew it was commin' ) capital gains windfall will dry up in '98. What then, raise taxes? Or find another hidden way to fleece the lambs.

You guy's can rip this apart and analyze it to the smallest quark if you like. All I need to know is where to put my money in the short term before the DOW falls over the cliff.

With my deepest respect to our king John D, his bishops and court jesters, I will post my considerations later as I crawl on my knees, bow deeply and humbly beseech thee to have pity for this mere mortal to toss a sliver from your golden crown. ( that grin thing )

The Shinning One

(Sat Dec 27 1997 16:16 - ID#228128)
Lows in gold
APH and other technical analysts: Since gold bounced off but did not penetrate the 85 lows ( and another previous low several years earlier ) , does this set boundaries for how high gold will go in the next bull market? Does it keep us range bound until some final bottom is found in a future year? I know that some of the cycle analyses require bottoms to be taken out or else final bull markets are postponed. What is your thinking?

Mr. Mick
(Sat Dec 27 1997 16:23 - ID#345321)
Tolerant!! HOW 'BOUT THEM VIKES!!!!!
Whad ah tell ya!!!!! Talk about a miracle!

(Sat Dec 27 1997 16:26 - ID#26793)
Are you sure you want to invest in anything while you still have a mortgage? If you expect to be laid off then you should be investing in very short term Treasuries, not goverments, Treasuries. After you have enough on hand to get you through a rough spot you should pay down your mortgage with advance payments on the principal. Credit card balances should be zero. Car payments should be zero. Then consider investing.

(Sat Dec 27 1997 16:32 - ID#287277)
Walking the circle...
Inflation, Deflation root Latin, flare, to puff or blow, breathing in, breathing out....inflation, deflation...

One might argue that the terms are process-linked; the initiation of one calling into being the initiation of the other. This argument predicates normalcy, and one might suggest that these are not normal times. The last of normal times described by Milton Friedman, a monograph on Money:

"The early 20th century was the great era of the international gold standard. Gold coins circulated in most of the world; paper money, whether issued by private banks or by government, was convertible on demand into gold coins or gold bullion at an official price ( with perhaps the addition of a small fee ) ; and bank deposits were convertible into either gold coin or paper currency that was itself convertible into gold. In a few countries, a minor variant prevailed--the so-called gold-exchange standard, under which the currency was converted at a fixed price into the currency of another country ( usually the British pound sterling ) that was itself convertible into gold.

There was, in effect, a single world money called by different names in different countries. A U.S. dollar, for example, was defined as 23.22 grains of pure gold ( 25.8 grains of gold 0.9000 fineness ) . A British pound sterling was defined as 113.00 grains of pure gold ( 123.274 grains of gold 11/12th fine ) . Accordingly, one British pound equalled 4.8665 U.S. dollars ( 113.00/23.22 ) at the official parity. The actual exchange rate could deviate from this only by an amount that corresponded to the cost of shipping gold.

If the price of the pound sterling in terms of dollars rose to a considerably higher value than this in the foreign exchange market, someone in New York City who had a debt to pay in London might find that, rather than buy the needed pounds on the market, it was cheaper to get gold for dollars at a bank or at the U.S. subtreasury, ship the gold to London, and get pounds for the gold from the Bank of England. This set an upper limit to the exchange rate. Similarly, the cost of shipping gold from Britain to the United States set a lower limit. These limits were known as the " gold points."

Under such an international gold standard, the quantity of money in each country was determined by the specie-flow adjustment mechanism analyzed by 19th-century economists. If, for whatever reason, the quantity of money in a country rose unduly, this would tend to raise prices in that country relative to prices in other countries; the rise in prices would have the effect of discouraging exports and encouraging imports.

The decreased supply of foreign currency from the sale of exports plus the increased demand for foreign currency to pay for imports would tend to raise the price of foreign currency in terms of domestic currency.

As soon as this price hit the upper gold point, gold would be shipped out of the country to other countries. The decline in the amount of gold would produce in turn a reduction in the total amount of money--because banks and government institutions, seeing their gold reserves decline, would want to protect themselves against further demands by reducing the claims against gold that were outstanding. This would tend to lower prices at home.

The influx of gold abroad would have the opposite effect, increasing the quantity of money there and raising prices. These adjustments would continue until the gold flow ceased or was reversed.

This is precisely the mechanism that operates within a unified currency area, the mechanism that determines how much money there is in Illinois compared to how much there is in other states or how much there is in Wales compared to how much there is in other parts of the United Kingdom.

In the early 20th century, most of the world was a unified currency area, so the gold standard functioned throughout the world. Its great advantage was that--if permitted to operate--it would greatly limit the power of any national government to engage in irresponsible monetary expansion. 

The neat, orderly, linear world described does not exist. What we have, my friends, is a Menger sponge, a solid-looking lattice that has an infinite surface area, yet zero volume.

The Valuers will have window-of-opportunity to bring the world back to a value standard. The battle to clear a path to the window has already begun.

(Sat Dec 27 1997 16:33 - ID#344308)


greetings, oh great receiver and relayer of smoke-signals....

what say you of the current topping-out of bonds....? looking
good from many angles....

denver kicking bootie----------

(Sat Dec 27 1997 16:36 - ID#301318)

I have no outstanding bills!!! I am completely liquid.
My job position is secure, for now. I work for a utillity. But who the hell knows.

The mortgage I refer to is a relatives. I want to purchase my first home in '98 ( I am 28 ) but all this talk here scares the day lights out of me. I need to do something with my future down payment. I am willing to gamble it. If I lose all it won't take me long to recover. PM funds are what I am looking into as we speak. Want to make a move within a week.

Hope this helps all, thanks.


(Sat Dec 27 1997 16:38 - ID#31868)
Mr. Mick - Cheers!
I am chewing my pie, that is HUMBLE PIE. I am enjoying it. To the victor go the spoils. I am bigger for the experience, appreciating the high level of emotion for those that are happy that their team won.

A loser with dignity and thankful for tequila. Gulp. Cheers to the Vikings fans.

Now as to this gold thing. The Asians will rule the day as they purchase huge amounts of the metal. They have no choice This will ignite the fuse on the precious metals rocket ship.

Worldwide people will want to get on board as gold starts to ascend, assuming it's rightful place, price wise, with the rest of the hugely overpriced equities market, etc.

It will over shoot at first and then settle and find it's equilibrium in line with the price of the rest. Gold is real money, against which all other commodities are measured. It is the fulcrum on the world's financial metronome.

I certainly would not want to be without physical and mining shares in 1998 and beyond.

(Sat Dec 27 1997 17:06 - ID#287305)
An alternative to paper based futures?
Up until about about a month ago I was trading futures and options on a daily basis. The problem with doing is that if you honestly believe that PMs are going to suddenly go up in price you must be willing to consider the possiblity that your commodities brokerage may default.

If you take the time to review all of the documents you are required to sign before opening a account you will notice that ALL brokerages have a disclaimer about bankruptcy. If they declare bankruptcy you are screwed, plain and simple.

You may get pennies on the dollar which could take years to resolve. If the dollar truly crashes which of you think that the commodities brokerages will be immune to the effects of such an event? If the markets lose billions, who will speak for the PM traders? Do you think that government officials, lawyers and the general public will have any sympathy for the evil gold traders who are made money off of all the poor middle class investors?

I have closed my account and converted to physical. If you are a risk taker at heart there is always another option you may want to explore and that is numismatic coins.

The market is extremely depressed right now. Most of the high grade investment coins are trading at 1/5 of the 1989 highs. If gold goes up only $100 an oz these coins could easily double or triple in value.

The other thing I like about numismatics is that they allow you to possess extreme rarity and beauty. Bullion is great, but there is nothing unique about a Gold Eagle.

A Proof 65 Seated Liberty Half of which there may be only a dozen other coins in existence is awe inspiring. Each of these coins has distinctive features that make them totally unique.

Example: An MS 65 Barber quarter goes for about $900. The 1989 high for this coin was around $4500.

Even if the government confiscates bullion, I don't think they will go after numismatic coins or pre-1933 gold. It's also a lot nicer to hold the the actual coins than to receive a computerized transaction report from the brokerage.

Another thing you might want to consider, let's say the market crashes. You've invested $5,000 in gold and silver options and you make a million on paper. This assumes that your brokerage doesn't go bust or the government doesn't fabricate some reason to confiscate your wealth. The banks are closed and you are now the proud owner of 1 million dollars.

As the weeks go by you patiently wait for the government to straighten out this mess, what the hell, you've got all the time in the world. The price of gold has gone to $1000 an oz. Life is looking good. Of course it takes 2 months to finally get your money.

You go to your nearest bank and ask for cash and the teller doesn't even raise his eyebrows. He hands you a freshly printed, crisp new 1 million dollar "New World Order" reserve note. You go to your local coin shop to convert to gold. After fingerprinting, photos, paying for a license and receiving approval, you hand the coin shop the 1 million dollar bill and they give you 15 1 oz gold coins. Boy, weren't you smart?

(Sat Dec 27 1997 17:09 - ID#26793)
You are one in a million of 28 year olds. That is a nice balance sheet. I would not buy a house until I could purchase one for an amount of less than 100 times its current monthly rent. In most U.S. locations I suspect that renting is the best option. My own PM purchases are Central Fund of Canada ( CEF ) on the American Exchange. It closed Friday at 3 7/8 but has a net asset value of US$4.44. That is a 12.7% discount. Each share is .008 ounces of gold and .31 ounces of silver ( July Report ) . The metal is held in storage in Canada. It can not be loaned and is insured by Lloyds. I take delivery of the share certificates. It is a strictly dullsville investment ( so far ) .

(Sat Dec 27 1997 17:14 - ID#287305)
Nice Post!

(Sat Dec 27 1997 17:14 - ID#285309)
James, your 15:19 re.:Roman Empire Demise.

One has to inspect the monetary/financial profile as well as military one when studying the situation that existed prior to a collapse of an empire, such as the Roman.
The Roman Empire had a stable currency backed primarily by gold ( 22k coins ) early last millenia. For almost 200 years their monetary stability has been unmatched by anyone since, including US. For 200 years their inflation rate was well below 3% !!. Then, the military as well as social pressures dictated inflationary solution. In their case, it was the dilution of the gold content in their coins which enabled the emperors to issue more money, i.e.; increase their "M3". The inflation followed with hyperinflation as an end result.
So, it was the monetary collapse, debasement of their currency that weakened and eventually destroyed Rome. We are doing our best to copy them. Today, we are of course more sophisticated. We issue debt instruments, which will never be paid off, call it assets and borrow more money aginst it. This criminal destruction of the monetary system will have dire consequences. The $$$ bills should have "God Help Us" on them because nothing else will.
The lies and more lies from the authorities are just postponing the inevitable. "The US has almost balanced its budget", at least that is what people are told. Then, how come that the on-book debt has increased well over $150 billion so far this calendar year?

(Sat Dec 27 1997 17:17 - ID#285309)
James, your 15:19 re.:Roman Empire Demise.

One has to inspect the monetary/financial profile as well as military one when studying the situation that existed prior to a collapse of an empire, such as the Roman.
The Roman Empire had a stable currency backed primarily by gold ( 22k coins ) early last millenia. For almost 200 years their monetary stability has been unmatched by anyone since, including US. For 200 years their inflation rate was well below 3% !!. Then, the military as well as social pressures dictated inflationary solution. In their case, it was the dilution of the gold content in their coins which enabled the emperors to issue more money, i.e.; increase their "M3". The inflation followed with hyperinflation as an end result.
So, it was the monetary collapse, debasement of their currency that weakened and eventually destroyed Rome. We are doing our best to copy them. Today, we are of course more sophisticated. We issue debt instruments, which will never be paid off, call it assets and borrow more money aginst it. This criminal destruction of the monetary system will have dire consequences. The $$$ bills should have "God Help Us" on them because nothing else will.
The lies and more lies from the authorities are just postponing the inevitable. "The US has almost balanced its budget", at least that is what people are told. Then, how come that the on-book debt has increased well over $150 billion so far this calendar year?

(Sat Dec 27 1997 17:18 - ID#93232)
@Donald...Another insightful post @14:26...Great work.
Donald, are we in the last stages of deflation which precede the birth of inflation? Prices of certain durables may continue to decrease due to global financial woes and shifts in competitive trade advantage, but costs of services, labor and capital are heading up in the U.S.. I also believe that prices of what we used to call "primary resources" have bottomed, so that, manufactured goods that have these materials as their primary cost component are headed up also.

Probably the most contributory conditions sponsoring the existence of staglation in the U.S. have been low cost of capital ( operating and investment ) and $8./bbl. oil ( in 1980 dollars ) . When the stock and bond markets contract, industry will no longer have a source for essentially "free" capital. The whole concept of no-cap companies with no earnings, no operating history and transient management being able to access hundreds of millions of public debt may soon appear absurd. These companies, along with their bigger brothers, will soon have to go to banks for capital and with the increased demand for debt will come higher borrowing rates...roll that into goods' costs.

I continue to be amazed by soft oil prices. I, for one, can't imagine the producing states continuing their unlimited output policies ad infinitum. Their costs of production have increased dramatically and these countries' economies are thirsty for capital, with a couple of exceptions. The "cartel" may reappear with Iran gently hawking the price for the group. In any case, oil is headed up from these levels over the next two years.

(Sat Dec 27 1997 17:22 - ID#287305)
I would do a 50/50 split between pre-1965 junk silver and pre-1933 common gold coins such as St. Gaudens, $10 Liberties, $20 Liberties.

Bob M
(Sat Dec 27 1997 17:31 - ID#26059)
Inflation in the US has been heading up for quite awhile..nothing that i have bought in the last few years has declined..between insurance, food, my calculation the inflation rate for my family has been around 7-10%..a far cry from the 1-2% that is touted around on CNBC

(Sat Dec 27 1997 17:31 - ID#31868)
You are getting some solid advice from the people here. There are many places to obtain coins and bullion. One I deal with is Jefferson Coin 800-593-2585 ask for Russ Savage.

He a decent fellow and will not steer you astray IMHO.

(Sat Dec 27 1997 17:38 - ID#26793)
I tend to think we are experiencing a rolling deflation that began in April, 1980. Volker ended the Nixon/Ford/Carter/Miller inflation by seriously raising rates. The most highly inflated section of the economy at the time, the oil patch, took the first hit. It was followed by farmland, then S&L's and tangibles. Next was commercial real estate with the stock market to be last. Outright worldwide deflation, the price of everything, will follow U.S. stocks.

(Sat Dec 27 1997 17:41 - ID#93232)
I think I now understand "gold standard" for the first time...your essay cleared it up for me...Thank you.

Lurker 777
(Sat Dec 27 1997 17:48 - ID#317247)
Schultz / all
I am currently buying gold coins and June 99 puts for insurance. When I buy 100 oz. of the physical I limit my downside risk buy taking out a put option. Example: I bought 100 Philharmonics for 299.30 ea. ( $29,930. ) and bought one June 99 270 put 100 oz. contract for $630. If gold drops below $270.00 oz. my put option limits my downside risk to 10% As a added bonus the coin has a face value of 2000 Austrian Shillings ( $160.00 ) and if gold drops below 2000 Shillings I have the option of going to Austria.

If gold collapsed do you think my options are at risk?

(Sat Dec 27 1997 17:54 - ID#286199)
Asian Imports
Donald: You make an eloquent case for deflation using the example of the Korean car industry. A couple of points are in order. Point one: They make really crummy cars. The KIA is a joke. KIA is bankrupt, I think, though the government may bail them out. Point two: The Koreans cannot cut prices on cars as much as you indicate because they must purchase raw materials for construction and most raw materials are priced in US dollars. Labor costs go down, but materials costs go up. Therein lies the fallacy of Asian countries gaining market share in the US via devalued currencies. There is a floor under costs and it consists of raw materials prices and regulatory restrictions. Regulations will be used to protect American businesses. Mexico makes cheap cars that cannot be imported to the U.S. because they don't meet "safety" standards. I wanted to buy a Mexican copy of the German Volkswagon Bug, but the cost of upgrading things like the windshield and making it burn unleaded gas, made the deal too expensive.

(Sat Dec 27 1997 17:57 - ID#93232)
@Lurker 777.....
Maybe we could buy a duplex in your choice of Austrian cities. Together we have mass quantities of Shillings....let's run for the border like Disney told us to!

(Sat Dec 27 1997 17:57 - ID#26793)
Tomb of the unknown fund

(Sat Dec 27 1997 17:57 - ID#301318)
@Donald_A & Shultz

:Donald - FYI - I was looking at the latest performance stats of "all" mutual funds for the last month. Prior to this last weeks report, there were no PM funds in around the top 10 or so. If you look at the latest, out of all funds, you can see a few PM funds poking their heads in with Blanchard PM on top of the list. Keep in mind I am only interested in riding the bull up for the next 4-6 months ( if it happens ) then I am outa here.

As of the 19th Dec, I have Blanchard PM, Gabelli, Lexington S.I., as the top three out of all PM funds during that week. What I also did is look at the performance of all PM funds during the '93 gold-bull to get an idea what to expect if it occurs again. Blanchard & Lex. S.I. are again near the top. I am leaning towards Blanchard ( mostly Canadian holdings ) . Any opinions? I can post their holdings if you like? I will look into your Canadian recomendation.

:Shultz - I am also considering 50% funds and 50% only GOLD coins. Just purchased 4 coin AE Platinum proof set. These are not just for bullion, these are for very long term. Only 8000 sets exist, your opinion? The only concern I have purchasing coins is getting fleeced by a dealer selling below grade coins at a higher grade. I need to find a good dealer. Any recomendations? Your thoughts on slabs?

( deep bow )
the Shinner

(Sat Dec 27 1997 18:02 - ID#301318)
Thanks, just what I was looking for. Any others have coin dealer suggestions?

Bob M
(Sat Dec 27 1997 18:04 - ID#26059)
Flash- be careful when purchasing slabbed coins also, as most of the time the certified coin will meet the criteria for the techniucal grade, but will be lacking the eye appeal that really makes the coin...before you buy slabbed coins learn what you are doing and reead up on the particular website has some info on what coins I feel are trult rare coins and have the best shot at only want the upper end of the grade..

(Sat Dec 27 1997 18:05 - ID#301318)
@Donald_A & Shultz (repost)
:Donald - FYI - I was looking at the latest performance stats of "all" mutual funds for the last month. Prior to this last weeks report, there were no PM funds in around the top 10 or so. If you look at the latest, out of all funds, you can see a few PM funds poking their heads in with Blanchard PM on top of the list. Keep in mind I am only interested in riding the bull up for the next 4-6 months ( if it happens ) then I am outa here.

As of the 19th Dec, I have Blanchard PM, Gabelli, Lexington S.I., as the top three out of all PM funds during that week. What I also did is look at the performance of all PM funds during the '93 gold-bull to get an idea what to expect if it occurs again. Blanchard & Lex. S.I. are again near the top. I am leaning towards Blanchard ( mostly Canadian holdings ) . Any opinions? I can post their holdings if you like? I will look into your Canadian recomendation.

:Shultz - I am also considering 50% funds and 50% only GOLD coins. Just purchased 4 coin AE Platinum proof set. These are not just for bullion, these are for very long term. Only 8000 sets exist, your opinion? The only concern I have purchasing coins is getting fleeced by a dealer selling below grade coins at a higher grade. I need to find a good dealer. Any recomendations? Your thoughts on slabs?

( deep bow )
the Shinner

(Sat Dec 27 1997 18:12 - ID#301318)
@Bob_M & Shultz
I think I am ahead of you. I picked up 2 books by Scott A. Travers, 1 is How to Make Money With Coins NOW!

My problem is my lack of experience/ability grading coins. I need to find a trustworthy dealer. One whom will look out for MY best interests. I have no local dealers in town. Mail order is my only choice, must by site unseen w/return policy. The nearist dealer is 150 miles away!

(Sat Dec 27 1997 18:13 - ID#347457)
@James and Romans vers US military powers
James, yes Romans armies suffered more and more defeats in the end, however, it was not so much because they lost the military "edge", fighting skills, or they had less advanced weapons than their enemies. It was logistic, decaying political system, budgetary problems to cover the cost, and conflicts on multiple fronts throughout the empire.

The US military was not ever really challenged that way. And with corrupt political system which have a problem to make decision fast, the US would have the same ( if not worse ) problem despite its military superiority.

Lurker 777
(Sat Dec 27 1997 18:16 - ID#317247)
Its over the Swiss Alps to the Austria border but who is going to carry the gold. 6.5 pounds per 100 oz. and I will have over 20 lbs. Plus 100lbs of worthless dollars?

(Sat Dec 27 1997 18:17 - ID#393224)
Bravo Donald
Donald--enjoyed your 14:26 immensely. Now I've got a bit more work for you or anyone else out there.

Does someone have a meaningful price comparison of gold with commonly consumed items over this century?? I am distrustful of the one oz=xxx loaves of bread as I remember the bread of my youth compared to the air-filled sponges they sell today. More believeable would be bushels of good quality wheat/oz or some other commodity/oz that would measure "the same" commodity per oz from, say 1900 to today. Business suits are also suspect unless the amount of cloth, quality etc. can be taken into account. Same for average worker's house as houses are much bigger today. You get the drift. Do any of you have such a comparison?? Would be very useful in an inflation/deflation debate.

(Sat Dec 27 1997 18:20 - ID#26793)
I can't argue the point about Korean cars. I was looking for an easily understood example to make the point about deflation. I am sure you are right in that the pricing details are much more complex. My major point is that foreign countries are competing with each other to deflate even more and to send those deflated products to the U.S. I said the UAW is not going to stand idly by. I failed to note that China, Japan, Indonesia et al will not stand idly by either. Reference to Korea was meant to simplify the argument. Japan has great cars, soon at great prices. China and Russia have raw materials, also at great prices. All those places have targeted the U.S. as their best customer. It is not going to happen painlessly. Miners in Russia are paid in sausage how can we compete against that? China pays $2.00 per day or uses slave/prison labor. How can we compete with that?

We are seeing some big history being made here. The world as we have known it all our lifetimes is over. The changes are not entirely predictable but they will not lead to an improved standard of living for any part of the world. We are now getting the bill for the credit we misused during the past 70 years.

Bob M
(Sat Dec 27 1997 18:22 - ID#26059)
If your looking for real nice slabbed Morgan Dollars check my inventory list out..I specialize in upper end dollars with real nice eye appeal and full return privelege...

(Sat Dec 27 1997 18:25 - ID#26793)
Coins are great, and beautiful, and safe. Turning them over in 4-6 months you are going to get killed on commissions. The markup is to big for that short time horizon.

(Sat Dec 27 1997 18:27 - ID#93232)
@Lurker777.....I've got the same problem....however....
May I suggest as our pack man...Karlito...typically headstrong but doesn't give a damn about the gold....or, maybe....Werner....simply point him in the general direction and pay him off with a couple of doobbies. He thrives in high altitudes.

(Sat Dec 27 1997 18:30 - ID#301318)
Much appreciate your url. Will investigate your wares.

(Sat Dec 27 1997 18:33 - ID#246272)
steady & James
Don't have to go back to the roman empire to find out about the debasement of their currency.Look what happend to the "third reich" and the USSR in this century!I have experienced the one and saw the other collapse.At their zenith its people believed it's system was rock solid.The populace 'trusted their money'and their governments supplied ( printed ) it and all lived happily untill their system broke down.

The third reich lasted 12 years of the proposed 1000 years and the sojwet regime did not last a century.Wonder if the USA democracy can play their money game without punishment forever?

(Sat Dec 27 1997 18:38 - ID#301318)
Yes, you are right! The commisions would kill it. Scratch coins. Sorry dealers.
( the frown thing, bow to Donald )

I don't feel we are heading into a currency meltdown in the very near term. The powers that be that got us all into this mess will find more ways to postpone the medicine. In the short term I feel paper investments in PM is OK. But, by the end of next year and beyond, look out.

Watchin CNBC, discussing int rates for '98. hmmmm


Lurker 777
(Sat Dec 27 1997 18:40 - ID#317247)
Coin Dealers?
Need to purchase 100 Philhomonics for less than $15. over spot from a reputable company. Has anyone bought gold coins at a better price?

(Sat Dec 27 1997 18:41 - ID#26793)
Good morning Nick. There is a great book on the subject; "The Great Wave" by David Hackett Fischer ( Price revolutions and the Rythym of History ) Oxford Press. I have it here. For example, page 122. Chart of the price of wheat in France 1726 to 1819, page 259 price and wage indices Babylon, 1850 BC to 1600 BC. My God! where did he find this stuff! Page 329 Price of Wheat in grains of silver as evidenced from the estates of the Bishops of Winchester 1300 to 1479!

(Sat Dec 27 1997 18:48 - ID#93232)
UsaGold, Denver ( also known as Centennial Precious Metals ) Mike Kosares has been brokering gold for thirty years....4.5% over spot for Phillies, 10-14 work days on delivery...800 869-5115

(Sat Dec 27 1997 18:49 - ID#31868)
What Donald_A says is quite true. Coins are not a short term investment. It is my belief that you should purchase a core position in coins as well as bullion. I deal with Jefferson because I have always gotten excellent service and I trust them.

You may wish to look at as another method of having metals in reserve. Read through the materials I think you will enjoy what you find there as another alternative. I have an account with them. Good people.

If you are looking at a moonshot I suggest reading the GoldBug at and look at the silver stocks in his articles. Excellent advice there.

BEARX is another solid performer if you think the market wil tank.

But let me leave you with this thought. I go back to my comment, you should have a core position of silver and gold coins. They are the best core investment/insurance from a purely survival point of view if things sour financially. It strikes when you least expect it.

Good hunting. There are many here that can help and assist you in what you seek. They will even discuss matters between themselves which will allow you to solidify your position of thought.

Gusto Oro
(Sat Dec 27 1997 18:50 - ID#377235)
Roman squandering...
Miro, I just finished a book on the Roman games and once tipped off to the huge drain they were on Rome the only amazing thing is that the Empire stood as long as it did. There was a anecdote in there about a Roman admiral and a senator or some such having this exchange:

"Our ships ready to sail to North Africa can bring back either grain to ease the famine or sand for the pending season of games. What shall it be?"

"Are you serious? Bring the sand of course."

(Sat Dec 27 1997 18:50 - ID#28585)
Haggis...pursuant to my previous post re: Pegasus...
After much research, I would say Pegasus collapsed owing to two major factors: one, the so-called "Bre-X Reaction," such that any hint of trouble in a gold company causes all shareholders to exit in mass panic.
Two, the activites of major gold investment specs & pundits, who sought to foment the mass panic in order to trash the equity to such a degree that they could step back in and pick it up for mere cents. In fact, volume remains quite heavy in the equity suggesting there are people purchasing the stuff with more in mind than retaining souvenir stock certificates.

Again, it makes absolutely no sense for the Australian bankruptcy court to liquidate Pegasus...there is simply nothing there to get. They are more likely to keep Pego solvent and viable, place the ol' horse under new managment, write off a portion of the overall debt, transform remainder debt into equity, and wait for some pop-up in gold prices to set fire to their shareholdings. Moreover, if the banks become shareholders in a gold corp., it's a perfect hedge in the event of a potential world-wide bank crisis.

Bottom Line: Pego is probably the best buy in the XAU crowd! ( i.e., for
specs with balls of steel )

(Sat Dec 27 1997 18:52 - ID#426220)
I posted this earlier today, but there was ZERO REACTION. Does this NOT make a monumental statement in light of all that is coming down in South Korea???

Yesterday GOLD-EAGLE was contacted by a director of the Korean Futures
Exchange ( KOFEX ) in SEOUL, Korea. He informs that KOFEX will shortly begin operations. One of the first contracts to be traded will be GOLD FUTURES.

Are there still any "Doubting Thomases" about GOLD's importance to the world... and especially the great significance and affinity the yellow metal holds for Asians?! South Korea is close to absolute and total bankrupcy... nonetheless, a new Futures Exchange will shortly be trading GOLD FUTURES. I WOULD INDEED BE REMISS were I not to mention that - IN MY CONSIDERED OPINION - most probably not a few of the $57 Billion rescue package, promised by the IMF, will inevitably find their way into GOLD FUTURES traded on KOFEX.

(Sat Dec 27 1997 18:53 - ID#227238)
Schultz ( An alternative to paper based futures? ) : Nice post. Options even dicier in a meltdown.

(Sat Dec 27 1997 18:53 - ID#339320)
Of fulcrums and metronomes...tick tock tick tock

Mike Sheller:
Thanks for the reply re: silver. Can you post that
price chart?

Tolerant 1 said:
"Gold is the fulcrum on the world's financial metronome".
Let this be cast into a bronze plaque, and hung on the Kitco wall for posterity.

(Sat Dec 27 1997 19:00 - ID#393224)
Korean cars
Donald--one problem with your Korean car analogy. How can the Koreans halve the price of a new car when the IMPORTED raw materials have NOT gone down in price. Korea is Australia's 2nd biggest trading partner. The iron ore ( for the steel ) , coal ( to power the car factory ) , wool/cotton ( for the upholstery ) , oil ( for the plastics ) etc. are NOT going to halve in price. The only way the Koreans are going to sell cheaper cars is to make economies at home. Workers will get paid less. Efficiency ( fewer worker hours/car etc. ) will be improved. The Koreans will have to "give" the cars away at lower profit margins in order to maintain their market share. International Finance for Korean car companies is going to increase in price. They will be getting more won/exported car, but not more $US, $A, DM,  etc. Their debts are paid in those currencies, not won. I do not follow your cheaper Korean car example.

(Sat Dec 27 1997 19:01 - ID#28585) old Scottish poem I unearthed in my closet....
I once knew a fella, name of Haggis,
Who didn't think a damn 'bout Pegasus,
Until the one day came
When he realized his name
Haggis rhymes pretty good with Pegasus.

(Sat Dec 27 1997 19:05 - ID#28593)
Yes, Tolerant1 does that quite often; very quietly ZAPS
you with a purrfect metaphor!
Tolerant 1 said:
"Gold is the fulcrum on the world's financial metronome".

(Sat Dec 27 1997 19:05 - ID#31868)
Perhaps it is due to our having come to expect monumental commentary from you and gold-eagle. It certainly is more than interesting. If there is one thing I have learned it is that sentiment towards the metals can change in less than a heartbeat.

Clearly things in Asia are horrendous. My heart goes out to the people there and all people that are not prepared around the globe for this expanding monetary melee.

It is long over due but IMHO our worldwide financial system is in dire need of a golden enema.

(Sat Dec 27 1997 19:12 - ID#286199)
Go back and read Donald's answer to me @ 18:20. I made the same point.

(Sat Dec 27 1997 19:12 - ID#26793)
I found a chart in "Sivler Bonanza" by Blanchard & Sanders ( page 150 )

Ounces of silver needed to Buy a Median Single-Family U.S. Home 1890-1993
Be pleased to "eyeball" it for you or postal service mail it to you on Monday.

(Sat Dec 27 1997 19:15 - ID#227238)
First hand anecdote from "over there".
While listening to local talk radio this PM, the guest, a local news reporter, discussed his recent trip to Thailand. Among other observations, he commented on a job search by the city of Bangkok for financial professionals.

It seem that during the prosperous times, many left the employ of the city for more lucrative positions. The old salary was on the order of $1200 per month.

The city of Bangkok is now advertising for replacements who are foreign trained. Specifically, Harvard, Berkeley, Oxford and etc.

But the salary range has been reduced somewhat. Present positions are now being filled at a salary of $150 per month. ....... A strong whiff of the future????

(Sat Dec 27 1997 19:15 - ID#344308)


hey------i'm excited...

more volatility..........

too bad they were'nt gold trading futures during the last two weeks!

it does not matter who does what now....the die is cast, the mold
poured with the shape of things to come....

gusto oro--back @you soon...absolut-- ( ely ) woo-woo-woowoo--woo-woo-woowoo
fireh20--------flaming arrows from the seven sisters, flux and chaos---

hg wells, asimov, heinlein, asimov, newton, einstein, kr......the giants,
the seeds........knowledge....for free.............

bbl for r2

eya-----cherokee!; )

(Sat Dec 27 1997 19:19 - ID#398105)
Vronsky - Asian Central Banks and existing Golds Stocks


I am aware the the BOJ held the order of 0.4% gold in there financial portfolio as of end JUne 1997. Do you have any statistics concerning the gold held by other Asian Central Banks - now and end June 1997?

I hope you gave the "Diggers and Dealers" Conference a selected read. I believe that you would find this Conference of interest.

Aye, Haggis

(Sat Dec 27 1997 19:24 - ID#301318)
Baht Float
I meant to ask this before. Does anyone know the reason why Thailand decided to float their currency which started this Asian contagion?

I have also heard that many foriegn employees in Thailand that are paid with baht are leaving the country. Same in Korea, perhaps soon Japan.

Anyone for an overseas assignment?

(Sat Dec 27 1997 19:26 - ID#26793)
You asked about historical information concerning the Silver/Gold Ratio. I have some charts and tables back to Menes, Egypt 3200BC 2.5 to 1.

Rome, Greece 10:1 to 12.5:1

Medieval Italy, England 11.1:1 to 12.6:1

Modern times 1600-1620 12.1:1, From 1700 through to 1870 the ratio never exceeded 15.6:1. 1932 75:1, 1940-41 100:1, 1980 16:1, 1991 100:1

(Sat Dec 27 1997 19:30 - ID#26793)
Most economists are pointing to the Chinese devaluation of 1994 as the trigger for all Southeast Asian devaluations.

(Sat Dec 27 1997 19:36 - ID#398105)
To All..........Australian Exploration and Mining Information

G'Day from Kalgoorlie in Western Australia.

For those interested in ON-GOING UP TO DATE date information concerning the Australian gold and minerals exploration and mining scene, you may wish to review this site:

The publications "Paydirt", "Australian Gold Gazette" and "The Australian Mines Handbook - 97/98 Edition" can be sourced.

Happy information.........

Aye, Haggis

(Sat Dec 27 1997 19:37 - ID#393224)
Silver houses
Thanks Donald for The Great Wave and Silver Bonanza. I think a comparison of house prices with silver would be of interest to all Kitcoites, so please eyeball it for us. Saw your reply to Speed ( thanks Speed ) . Will have to catch up on posts before going off half-cocked.

farfel ( poetry ) -- don't quit your day job, mate.

Lurker 777
(Sat Dec 27 1997 19:41 - ID#317247)
Thanks for the info, I will give him a call.

My brother-in-laws wifes sister lives somewhere in Austria. She says the taxes are very high and so is the cost of living but with all those Shillings and worthless dollars we could go to Bosnia or Czechosolvakia and pick up some cheap Vodka to import back to North America. Surely alcoholism will be on the rise after the great recession/depression of 98.

(Sat Dec 27 1997 19:41 - ID#26793)
Wage rates in the Ukraine: note many are not paid, only owed wages

(Sat Dec 27 1997 19:44 - ID#28585)
HAGGIS...Yet another Scottish ditty found in my closet...
Oh, just once in a century, a man might discover
The one gold mine that's unlike any other,
He'll never have to kiss any more asses,
Never be short of comely fair lasses,
And now I know just where to find,
That once in a lifetime motherlode mine,
No, it's not anywhere near ABX or PDG,
Nor anywhere near NEM, as far as I can see,
In fact, it's straight ahead, right in front of you,
It's name is Pegasus, the symbol PGU.

(Sat Dec 27 1997 19:51 - ID#26793)
1000's of ounces of silver to buy median single family U.S. home
1890 3.8, 1900 7.0, 1910 9.0, 1920 4.5, 1925 9.8, 1930 21.7, 1935 8.0,

1940 17.0, 1945 9.0, 1950 9.0, 1955 13.0, 1960 23.0, 1965 12.0,

1970 16.5, 1975 9.0, 1980 2.7, 1985 13.0, 1990 26.2

(Sat Dec 27 1997 19:57 - ID#398105)


Excuse my cultural bias, but now and again the Yanks appear to hit thimgs on the head!

One correction - some gold mines make a profit, others don't.

Check out the address on my previous posting concerning Aussie exploration and mining.

Aye, Haggis

(Sat Dec 27 1997 20:00 - ID#26793)
1996 house price would be 21.6 thousand ounces of silver

(Sat Dec 27 1997 20:02 - ID#286199)
On the ground report from a friend who traveled to the Ukraine last month: Ukranian tire factory paid workers in tires! They had to hustle tires to passing motorists along the roads for cash. I wonder what they pay the sewer workers? : )

(Sat Dec 27 1997 20:08 - ID#26793)
Funniest thing I heard today! There is no need for sewer workers because there is no food except mushrooms. Its a closed loop.

(Sat Dec 27 1997 20:12 - ID#398105) and gold

G'Day from Kalgoorlie in Western Australia.

Aye, we have a similar problem here in Kalgoorlie. With the depreciation of the Aussie dollar, companies have to start paying their employees in gold. The things that you have to put up with. It's a rough life!!

Aye, Haggis

(Sat Dec 27 1997 20:14 - ID#287305)
Lurker 777
That's a very smart way to protect yourself and it was exactly how I got started in trading futures. You might want to scroll through last nights postings re: deflation. Although I do not believe in deflation, I do believe in central bank manipulation of public perception. If they manage to significantly drive down gold once again this will by definition mean that they are strengthening the US dollar. Your puts should be safe.

(Sat Dec 27 1997 20:16 - ID#393224)
More silver for your house
Donald--thanks for the silver info ( 19:51 ) . Could one of you computer literate types with a charting package possibly put it into chart form for us and post it?? Pretty please. Could be a good basis for discussion of pm's and inflation/deflation.

Donald, a couple of comments. It now costs a lot more silver to buy a house than early this century. Is silver devaluing or are there more materials etc. in a house. Also note the house/silver price in 1930 is almost identical to 1996. Is there a message in that???

(Sat Dec 27 1997 20:21 - ID#26793)
@Speed..your post reminded me of...
I had a friend, now deceased, who worked for the local phone company during the Depression. In those days Saturday was a half day but in the afternoon you were required to go door-to-door trying to convince people to connect their phones back up. You were not paid for this. In 1936 a telephone poll taken by Republicans convinced them that Alf Landon would win the election against Roosevelt. They took only Vermont and Kansas. The people who had no phones voted for Roosevelt. Of course they were not polled.

(Sat Dec 27 1997 20:28 - ID#28593)
Well for goodness sake! Money flowing out of the market?
Barrons ( 12/29 ) Interview with Albert Edwards....
So, whos left to buy?
Edwards: Exactly. This is what worries us: that what could be just a fundamental correction turns into something much more vicious. Thats why we see the Dow bottoming nearer 5000 than the 6000 we believe would be warranted on value grounds.
the rhetoric coming out of the mutual fund industry is extremely misleading. They would have us believe that buying by the retail investor turned around the US market in October.

They tell us that actually there was just less than $1bn of equity selling on the Friday and the Monday of that correction--which is very low compared to the $2trillion of mutual fund assets. I actually saw that statement come across my Reuters screen! But the amount of assets is just irrelevant. What is important is the change in the flow. The monthly average buying in equity mutual funds so far this year has been $19.5 bn. So, if the household sector sold $1bn in two days--which translates to a monthly outflow rate of $10 bn--that is a massive change in the flow of funds.

Q: You mean they sold the dip?
A: No doubt about it.

(Sat Dec 27 1997 20:33 - ID#26793)
@Nick@C, All
I am out of my element on house prices. I wonder if land costs are included? 1980 there were no garages, 1955 1 car garages, now most homes have two. Lots of improvements in kitchens and bath, heating, insulation. On land costs, if included, zoning emerged in the 50's requiring larger sized lots in this area etc. many variables.

(Sat Dec 27 1997 20:37 - ID#286199)
That story rings true. My 77 year old Dad has many stories like that. I'm getting depressed. Away to expensive seafood dinner with family, while funny looking $50 bills still buy something tasty. BBL

(Sat Dec 27 1997 20:45 - ID#26793)
Median House prices 1970-1995

(Sat Dec 27 1997 20:49 - ID#26793)
How median house price is calculated

(Sat Dec 27 1997 20:57 - ID#426220)
Haggis__A ( Vronsky - Asian Central Banks and existing Golds Stocks ) : My information sources concur with your estimate of BOJ gold reserves. Unfortunately, I do NOT have data on the other Asian countries. HOWEVER, in light of the meltdown in currencies and stock market in the there, I would guess that they had far less than they ought to have had to avoid the predictament in which they now suffere and struggle.

(Sat Dec 27 1997 21:01 - ID#30116)
If you're going to buy something physical, why not buy some platinum Koala's? Platinum is 'cheap' now. If gold rockets ( ? ) , platinum will not sit idly by, IMHO.

(Sat Dec 27 1997 21:06 - ID#30116)
Mining what?
What is Japan going to mine in/with Saudi Arabia besides oil? There's something missing from this story.

(Sat Dec 27 1997 21:16 - ID#26793)
Weak Canadian dollar blamed on weak gold prices

(Sat Dec 27 1997 21:17 - ID#257148)
What's in an index?
Nick@C Donald
One obvious difficulty with house price calculations over a prololonged time period is, as has been mentioned, that a 1910 house is a very different beast, commodity, than a fin de sicle Y2K house, piped for utilities undreamed of decades ago. This is the reason, I suspect, that Roy Jastram ( Sorry to mention him again Skylark;- ) ) used a basket of raw materials as a basis for a commodity index. Then he compared the price of Ag & Au against that change in the commodity index to produce that infamous table showing how gold and silver are terrible investment during inflation but exceptional ( Silver outperforming gold ) during deflation. His book was published in 1980, so his commodity data only goes to 1979 -from 1560 -. Interestingly enough he uses 1930 as the Index equivalence date. I am, of course, happy to make the table available, But here is the other problem ( that is apart from finishing in 1979 ) This was done on my first computer many years ago, I have lost the details of what went into the basket of raw materials. I remember the basket changed over time, it involved wheat, meat, later coal...?


dust in the wind

(Sat Dec 27 1997 21:19 - ID#364147)
CherOkee................and the Giants
My 'world' ended~~~~~~~~~~~~still can't believe 'it'....

(Sat Dec 27 1997 21:20 - ID#364147)
YOU know my handicap......

(Sat Dec 27 1997 21:26 - ID#364147)
EB.........................................and Burritos
EB: Burrito just digested---------thankx!!!~~~~~back to my morning dressed in black.....

(Sat Dec 27 1997 21:29 - ID#26793)
Russian miners, unpaid for six months, block Trans Siberian RR in protest

(Sat Dec 27 1997 21:32 - ID#257148)
He aint heavy. He's my brother.

By our burdens we are known
By our thoughts we are uplifted

(Sat Dec 27 1997 21:37 - ID#26793)
Mexican indians outraged by ruling of judge on killings

(Sat Dec 27 1997 21:38 - ID#31868)
By our burdens we are known By our thoughts we are uplifted

You got that backwards

should be

By our burdens we are uplifted By our thoughts we are known

(Sat Dec 27 1997 21:41 - ID#257148)
the land of point, they do everything differently...

1tnarelot !thgiR
I got it barseackwards thanks


(Sat Dec 27 1997 21:43 - ID#393224)
silver crash
Donald, 1925= 9800 oz ag to buy house
1930=21700 oz ag to buy house
1935= 8000 oz ag to buy house

Does not auger well for the value of silver in a crash. Am I missing something here?? If the S&P crashes, are we to expect silver to go to $3/oz or are house prices going to boom. Doesn't make sense. I would have expected the opposite in the above prices/values.

(Sat Dec 27 1997 21:51 - ID#257148)
today's sharefin soup
Sharefin is apparantly not the only regular who is having trouble posting. He asked me to pass on these as worthwhile reads

Asia's about to implode, in a big way.
These articles are worth posting to Kitco - wish I could do it



donning a pair of wingd boots.. or hi heels for ..

(Sat Dec 27 1997 21:53 - ID#364147)
Aurator......................................................and bein uplifted
I read ya mate~~~~~~~~

(Sat Dec 27 1997 21:55 - ID#393224)
Guys-- my 21:43 on Donald's data for performance of silver in the crash fits in well with 'suoicarua data from Roy Jastram. Therefore the issue of whether we have an inflationary or deflationary scenario is crucial to pm's. Hate to buy all that silver and then find that I shoulda bought a few median houses instead ( actually I've done that too--so am well covered ) . Did real estate do THAT well in the 1930 crash??

(Sat Dec 27 1997 21:55 - ID#333131)
If you have a house in 1930 worth 15000 ounces of silver, why wouldn't you sell it, buy siver and buy two houses in 1935?

(Sat Dec 27 1997 21:58 - ID#393224)
silver houses
G'day Carl. You'll have to ask crystal ball that question.

(Sat Dec 27 1997 22:07 - ID#427357)
Asia's about to implode, in a big way.
These articles are worth posting to Kitco - wish I could do it

(Sat Dec 27 1997 22:08 - ID#333131)
Hi, The moral: people who want to live in silver houses don't stow homes.

(Sat Dec 27 1997 22:09 - ID#31868)
how come?
The IMF wants everyone to cut back their spending. hmmmm

Okay, I agree, no more money for the IMF. That takes care of a large portion of the billions of dollars going down the financial black hole.

Next. Like a barber shop, who needs the next trim.

Simple enough.

Thank you

(Sat Dec 27 1997 22:25 - ID#364147)
Skeptical Investor...........................................get it while it's hot

(Sat Dec 27 1997 22:28 - ID#26793)
Filling in silver years from chart to show spike better (eyeballed)
1929 14.0, 1931 21.9, 1932 17.0, 1933 16.0, 1934 13.0

(Sat Dec 27 1997 22:32 - ID#364147)
Skeptical Investor..........a little easier

(Sat Dec 27 1997 22:40 - ID#30116)
Japanese Mining and Dow chart....
I guess no one knows the answer to my question about the Japanese/Saudi mining deal.

O.K. Here's a Dow chart. Boring and mundane as it is...

(Sat Dec 27 1997 22:43 - ID#364147)
Not boring to me.......

(Sat Dec 27 1997 22:49 - ID#26793)
The crash was in October, 1929. By April, 1930, the market recoverd almost to its old high trapping many in a false rally. The big drop was 1931, 1932. There was a moratorium on foreclosures in 1933. I don't know when it ended. Bank runs started in Austria in April, 1931 but did not reach the U.S. until 1932.

(Sat Dec 27 1997 22:55 - ID#31868)
I have been trying to think of what it might be. Could it perhaps be that mining in the article was confused with tech innovation for drilling that the Japanese may have or be near to developing?

Monkee Person
(Sat Dec 27 1997 22:55 - ID#288105)
Vronsky and East Asia caveat
Some East Asian activities we are about to witness have their origins in

fear. Fear of destabilising political siuations, if not outright revolt.

many cirecumstances are much worse than publicized. Many suicides in

Hong Kong and South Korea. Factor those numbers by an order of magnitude

to find how many very desperate individuals and families exist.

Attempts to re-stabilize/re-establish economies are thwarted for the fact

that indigenous ones are privy to worldwide media networks ( i.e. are more

knowledgeable of current and pending probles...what brought them ) . I

expect armed intervention in at least one instance, soon.

Monkee Person
(Sat Dec 27 1997 22:56 - ID#288105)
Hello, Jin? Jin!?

(Sat Dec 27 1997 22:57 - ID#26793)
Foreclosure moratorium 1933

(Sat Dec 27 1997 23:00 - ID#26793)
4004 banks fail in first 8 weeks of 1933

(Sat Dec 27 1997 23:04 - ID#252150)
Ali@collapsing currencies & countries
The 3rd reich lasted only 12 years because besides being corrupt, it was ruled by a megalomaniac who was certifiably insane. The USSR collapsed

because it was defeated by the U.S. in the cold war.

I would'nt discount the abilities of Greenspan,Rubin & all the politicians & bureaucrats, along with their control of the IMF, BIS, World Bank etc, to keep the present financial legerdemain going for much longer than most goldbugs can even imagine.

(Sat Dec 27 1997 23:04 - ID#31868)
Since nothing could happen here in America, like 1929 again, it kinda makes all those little Executive Powers rather ominous.

Nah, I feel comfortable with slick at the helm.

(Sat Dec 27 1997 23:07 - ID#339212)
To Nick@C about silver purchasing power
I pressume the numbers of your 21:43 post refer to the same or very similar house.

(Sat Dec 27 1997 23:09 - ID#26793)
From a realtor in Colorado
1981 thru 1988

I now refer to this period as "The Great Real Estate Depression". It was a
terrible period! The whole thing started with the energy crisis. At first,
there were long gas lines then gloomy reports of the impending crisis and
the CIA reported that our fossil fuels would run out in just a few years.
The oil and gas companies that had expanded into Colorado, Wyoming
and Utah now were in full retreat back to Texas. The layoffs began and
the exodus out of Colorado grew with a vengeance.

Our inventory of For Sales in our MLS book zoomed to over 22,000
properties. Foreclosures, repo's and bankruptcies grew to record high
levels. Our economy and real estate markets were devastated.

My client list was comprised of the "walking wounded". Nearly every
client I had was a disaster case. They were being fired, laid off or
transferred. Their homes and businesses were failing and going into
foreclosure. Everyone was losing their shirt on their real estate and there
was not much we could do about it. Many of my clients were terribly
stressed financially, physically, and morally. Many of my clients got
divorced, got ill and some died. I'm not kidding! It was a real depression.
We all thought it would get better the next year but it continued to get
worse. It lasted a long time. We became very creative Realtors. We
invented certain types of financing that I hadn't seen before and I haven't
seen since. I negotiated quite a few short sales with lenders that saved
many clients from foreclosure. We gave keys back for "deeds in lieu of".
But, there were some clients I couldn't do anything for.

Those who fled to California enjoyed one year of prosperity there before
that market went into the tank. Texas and Florida suffered as well. Many of
my clients were "upside down"; they owed more money on their loans
than their homes were worth. So, many "walked". One of my clients who
didn't "walk" brought $40,000 to the closing table to pay off his loan. He
was a businessman who insisted he just had to salvage his good credit.

(Sat Dec 27 1997 23:10 - ID#393224)
no gold crash
Donald, as gold was fixed during the crash years ( was it 1933 that confiscation occured? ) , then silver crashed in gold terms and your au/ag chart would show this. Was it lack of industrial demand for silver that made it crash ( compared to house prices ) ? Obviously silver wasn't seen as a refuge in hard times.

(Sat Dec 27 1997 23:16 - ID#26793)
@Panda: Gold mining in Saudi Arabia

(Sat Dec 27 1997 23:18 - ID#31868)
So much for my weak theory.

(Sat Dec 27 1997 23:19 - ID#393224)
Same house
Myrmidon--we need more info on "median US houses" as we don't know what kind of controls were used. Scroll back for a few comments ( Aurator/Donald etc. ) on how houses have changed, whereas silver doesn't. We may be comparing oranges ( 1920 house ) with apples ( 1990 house ) . Anyone got info on "median house" statistics?? How are houses standardized through the years for these figures?? Silver appears to fare poorly in an deflationary crash. Gold? That was fixed in 29-33 so difficult to figure.

(Sat Dec 27 1997 23:25 - ID#393224)
?uoht tra rof erehW

(Sat Dec 27 1997 23:26 - ID#26793)
Gold was fixed at $20.67 per ounce intil March, 1933. It was repriced at $35 in 1934. Also in 1934 Congress passed the Silver Purchase Act. It authorized the Treasury to seize all privately held silver and pay 50c an ounce for it. 113 million troy ounces were taken. A 50% tax was imposed on profits of all silver transactions.

(Sat Dec 27 1997 23:31 - ID#257148)
ontrary to ordinary////
@KiN ici, nom ima, ici, sius ej

(Sat Dec 27 1997 23:32 - ID#339212)
Barrons Interview with Albert Edwards
To all you gentlemen. In this interview ( SDRer_A post of 20:28 ) one can conclude the following:

1. Mr. "public" always misses the major turning points of the market

2. The market movers are not the "public" but better informed money.

3. If he anticipates 5000 - 6000 in the Dow, and he bases this on public selling last week, I think he is using the wrong indicator

4. The public will be selling near or close to a market bottom, and do the buying close to or at the top.

Any comments?

(Sat Dec 27 1997 23:32 - ID#257148)
ontrary to ordinary////
@KiN ici, ima nom, ici, sius ej

(Sat Dec 27 1997 23:33 - ID#28594)
Unhappy old world...
Barrons D.C. Current

Dean Jorgensen, a tax-policy expert, predicts that one of the more controversial tax proposals from last year that might emerge again would require investors to compute the average cost bases of stocks they well when determining gains or losses...

Rubin also risks being perceived as a lame duck in 1998 if he fails to persuade Congress to spend up to $30 billion to bolster the reserves of the IMF...

The current crisis reveals the existing system doesnt work. says Thomas Palley, chief economist with the AFL-CIO...
Palley says that the IMF should demand that countries requesting its aid adopt higher human-rights and labor standards.

Also required, he says, is an international tax on currency traders to prevent capital flight and international regulation of foreign-currency loans to ascertain they are hedged properly.

The AFL-CIO also favors IMMEDIATE steps by the Federal Reserve, the Bundesbank and the Bank of Japan to stabilizer the Asian currencies through massive purchases.

Six Asian countries are among the top 10 purchasers of US electronics goods....

ALL of the above are worrisome....the following is unspeakable....

About a year and a half ago the wealthy Ziff brothers decided to invest a portion of their family fortune in some of Southeast Asias riskier markets--notably Laos, Sri Lanka and Bangladesh. Their buddies in the Clinton Administration had the Overseas Private Investment Corp. whip them up a sweetheart of a fund, providing the Ziffs and other investors who went along with them $2 in government guaranteed debt for every buck of their equity. With that kind of leverage, returns can run as high as 25%-30%, assuming, of course, that the investment decision are prudent. The South Asia Capital fund reached a total of $150 million. How is it doing? Great, considering. The fund never invested a dime, because its manager deemed the markets to be overpriced, according to OPICs Robert Stillman, vice president of investment funds.

Frankly, I don't think we should point a finger at Japanese
'corruption', when the other four fingers will be pointing back
at us...

(Sat Dec 27 1997 23:36 - ID#57232)
Saudi gold?
Donald: Great post about Saudi plans to mine for gold in Saudi Arabia! That is hilarious! My guess is that they have more gold under Saudi ownership all over the world, than all the gold they have underground.

(Sat Dec 27 1997 23:39 - ID#26793)
Maybe they are just looking for a hole in the ground to store all the new gold they are picking up for chump change.

(Sat Dec 27 1997 23:41 - ID#93199)
Fidelity Select Gold Charts
Fidelity Select American Gold & Precious Metals Charts:
Five Year Chart
120 market days Chart
30 market days Chart
10 days Hourly Chart

(Sat Dec 27 1997 23:42 - ID#35767)
much as he dislikes it he must work with the opposition ( Communists ) .
Pro Wall St Nemtsov who criticised the reds in Sweden is expected to be fired along with pro West Chubais. For the First time Yeltsin included High ranking Communists in meetings. In this case to formulate land reform policy. Communists propose and Yeltsin apparently accepts a BAN on foreign ownership of land and a long waiting period for resale if a domestic person makes the acquisition. The Times story indicates how Yeltsin wants to rid himself of reformers and "reconcile" with the Communist Party. Hmmm

(Sat Dec 27 1997 23:43 - ID#28594)
Aurator, I don't want to be indelicate but,
Your "C"s seems to have grown goatees?
Or, perhaps it is a little feather dangling from its chin?
My monitor screen is a little dusty...

(Sat Dec 27 1997 23:46 - ID#316409)
@ Nick @C..............modern day and MUCH more severe crash in metal vs. Real estate
Re your 21:45, we've already had a modren day crash like the one you're evidencing with SIlver. Only it's the Au this time. In my area, it's as follows;

1980, 111 oz Au, = 1, 3 Br 2 Ba Ranch house, Silicon valley area.
1997, 1,000 oz. Au, = the same house!!!!!

Talk about a crash! .10 cents on the dollar for the same house, after 17 years depreciation on that house! I don't know where you can go to find a worse crash in the relative value of something than this, and these are REAL NUMBERS, not a hypothetical.

Gold as a store of value? It's been nothing short of the worlds worst disastor for anyone who bought it at the 1980 peak. Perhaps worse than just about any other financial calamity that could have befallen an investor, outside of 100% loss derivitve type investments.

(Sat Dec 27 1997 23:47 - ID#339263)
Whatever happened to 10% of assets should be PMs?
With the enormous paper wealth created over the past 12 years what type of movement in Pms would take place if say... someone named Gates decided to invest 10% of his wealth in hard metals -just for insurance sake. And then trend followers did the same...?

(Sat Dec 27 1997 23:49 - ID#57232)
Russia looking bad if miners block RR's
Donald,all: On a more serious matter, we need to observe Russia very carefully. Russia is not linked to our fragile financial system, so we do not need to worry about the financial conflagration beginning there. However, a much more serious conflagration is possible, if the Russian workers are paid this winter with continued empty promises. How long would we put up with this if we were not paid for 6 months?

I am amazed how well the average Russian takes the antics of their government. But -- their patience will not be infinite. I can only hope that the western world will be allowed/willing to help with food and shelter solutions this winter, if needed.

Fincancial crises are one thing, but the prospect of war is quite another.

(Sat Dec 27 1997 23:52 - ID#393224)
silver thieves
Donald--so the US government compulsorily acquired it's citizens silver and then just to add insult to injury, took half the money back!! A good precedent for future emergencies, no??? Down the road a piece, President H. Clinton confiscates US citizens gold holdings "in the public interest" !!! Probably to pay for "The New Millenium Health Care Plan". They will need the money to take care of all the gold bugs in intensive care!!

suoicarua iH. Need some more info from Jastrom about precious vs everything else, mate. Is that book still in print? Anything on the net about his ideas?

(Sat Dec 27 1997 23:55 - ID#310407)
@ Aurator
Ve,%r7y,,myS##' TeR@iO,U,S@@pO?sT$s% bu?T@iiM= n @oT,iM,@prE+==ss=ed

(Sat Dec 27 1997 23:56 - ID#364147)
@ The End
G'nite all~~~~~~~~~~~~~~~~~

(Sat Dec 27 1997 23:58 - ID#310407)
@ Aur, etal
teaper retfa em, i evah ssel nairb rewop naht sivaeb dna daehttub.

(Sat Dec 27 1997 23:58 - ID#31868)
I wonder if NRA membership is growing. Just a thought from Printin Clintonville.

(Sat Dec 27 1997 23:59 - ID#57232)
Yeltsin's about face disturbing isn't it?
ROR: Interesting how Boris suddenly does not want foreign this and foreign that, isn't it? Boris is a pro at sensing the direction of the political winds in Russia, and it does not look good. Hard to tell what is next -- return to communism? That seems unlikely as the people have had a taste of freedom.

I wish I didn't think this -- but I think the most likely result is something more along the lines of fascism. Perhaps the next president of Russia will be a military leader -- hopefully elected peacefully. Hopefully this new leader will be able to regain control of the government without martial law. Unlikely given the pervasive nature of the Russian mafia.