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.

(Fri Apr 17 1998 00:03 - ID#340302) it a glee club for gold?
A certain poster recently disparaged this forum as evolving into nothing more than a glee club for gold. The central is imperative to hear the opposing point of view, i.e., the derogatory perspective of gold's value, in order to achieve balance and proper perspective.

Personally, I do not believe that Kitco's strong bias in favor of gold ( or silver ) is a a bad thing. Why? Because today, we live in a world in which gold is disparaged routinely in virtually all mainistream media...or it is ignored completely.

What is so wrong about the tendentious nature of this forum then? Why is it perfectly acceptable for a media outlet such as CNBC to blast its frequent, total, chauvinistic support of the supremacy of equities and bonds ( and the irrelevance of gold in a modern economy ) ...yet somehow various Kitcoites feel it is imperative for this forum to present a fair balance between goldbugs and their pro-equities/anti-gold poster antagonists...and the very same Kitcoites become oh-so indignant if they perceive the argumentation is balancing too far in favor of gold??

What is wrong with having another strong mouthpiece for gold ( such as the Kitco Forum ) in this "paper-pyramid-economy-is-OK-by-me" world? God only knows the World Gold Council is doing a miserable job of propagandizing gold's merits. So, what crime exists in allowing a preponderance of goldbug intellectuals to present their views over a non-mainstream internet site such as this and offer some token resistance to the mountain of anti-gold nonsense out there?


I welcome anti-gold exponents to post on this forum...I beg them to do so. However, be warned...there are those here ( myself included ) who will dispute your anti-gold logic until it crumbles into the nonsensical gibberish it really is. If that should happen and you run away, "crying to mama," then do not blame us!! Furthermore, let no other Kitcoites scold those of us who "take no prisoners" in such argumentation either.

The pro-gold/anti-gold schism is not a mere is nothing less than a cultural war. Despite the ostensible appearance of pandemic prosperity, this country is at war with itself. Anyone who would deny this is viewing the world through blinders.

There are many in this world and on this forum who have built their houses upon foundations of gold and silver...who clothe their families out of the fabrics of gold and silver...who feed their families from plates of gold and

...when you come on this forum and declare that these metals are effectively worthless...or headed to the dustbin of history...then you might as well be a rapist who breaks into my home. I will shoot you...I will kill you...I will rip off your ears and gleefully watch you bleed to death on my floor.



(Fri Apr 17 1998 00:09 - ID#227238)
Selby: Thanks for the SA site on Kalahari. Interesting to note that they have been selling Randgold shares to fund their mine development. That may explain some of the weakness ( lethargy? ) in RANGY.

(Fri Apr 17 1998 00:11 - ID#254201)
Time running out on the down side
A close today ( Fri. ) of 314 or higher in spot gold would create an accelerated advance in the gold market. Until that break out occurs we are still in a downtrend. Today's action was not impressive, June gold broke below it's trend line and rallied back up to it. That support line has become resistance. Silver is making lower lows and lowers highs as it works it's way down to the 6.00 level. The rally back today brought May silver back up to it's down trend line. Look for June gold to work its way down to 295-290 for a buy and May silver down to 5.85 -5.65. The good news is the down side cycles will soon begin to pass allowing for a rally in gold.

John Disney__A
(Fri Apr 17 1998 00:11 - ID#24135)
Royalty is now among us
For King Vronsky the First ..
I have declared you King of Ngumi-land in the
southern tip of Namaland .. The job was open due to
the unhappy demise of the last king - one jubajuba the
twenty- fifth. I have bestowed this kingship upon for your
meritorious efforts in setting a rocket under the
RSA market.. Everything went up.. see Hifeld steel,
De Beers, the bonds .. Unfortunately the golds were
off a little and would appreciate some extra focus
of your now legendary powers upon that sector. I suggest
you rule your Kingdom from a safe distance however as
the Kings are sometimes offerred as sacrifices to
obtain improved crops .. This method of human sacrifice
is much cheaper than increased fertilization.. It is UN
approved but opposed by Human Rights Groups.
However wish to express concern your recent lunch
of so-called "soube" noodles .. in Tokyo we used to
call them "soba" noodles .... perhaps you were eating
them in an Italian restaurant.

(Fri Apr 17 1998 00:16 - ID#190411)
Your 23:28 says it for me also. As one who is used to more formal language in communication, I got uppity with you last week. For that, I apologise. You make sense to me now.
I guess, I will have to go back to my wife's beatle albums; play them backwards until I figure out yuppie music. Ditto for rap.
Perhaps one time, when you post a chart as you did earlier this evening, you could make some comment about why you find it of value. I like many, are here for some education.

(Fri Apr 17 1998 00:16 - ID#57232)
Oil and Venezuela -- discussions with Mexico

(Fri Apr 17 1998 00:17 - ID#401237)

Thursday April 16, 11:49 pm Eastern Time

FOCUS-Venezuela blames speculators for forex slide
Foreign reserves have fallen by more than $2.5 billion, or 14 percent, to about $15.2 billion since the start of the year.
``That's what reserves are for -- to be used in the currency market according to the circumstances,'' Romero said.

I wish I understood all of this better. Didnt Venezuela sell a lot of Gold last year and then bought US Bonds?

There are funny things going on here that defies explanation - From Oil to Gold.


(Fri Apr 17 1998 00:17 - ID#256326)
On my GCM8 chart the 200 dma comes in just above 314, so a move up there would validate the bull. IF it stays! jeez.............

(Fri Apr 17 1998 00:18 - ID#233199)
@Disney - or whomever...
Is there any particular significance to the apparent weakness of RANGY of late? Should I stick with DROOY?

Thanks all


(Fri Apr 17 1998 00:23 - ID#256326)
Yep, the pols muck up the treasury sty and then blame the speculators!

(Fri Apr 17 1998 00:28 - ID#401237)
Nikkei 225

(Fri Apr 17 1998 00:29 - ID#254201)
That's encouraging if we both get the same results using different methods. I don't use any moving averages on futures. You may like this trade: I'm trying to buy the June Yen at 75.50 with a stop under the recent lows.

(Fri Apr 17 1998 00:33 - ID#153102)
@The One Constant in the Twilight Zone
is the USG War on Gold.
Gold rising to the $320-$360 range and a falling Dow would give the impression that Gold is winning the war. If USG can prevent it, I still think they will prevent it.

(Fri Apr 17 1998 00:35 - ID#401237)

S&P 500 JUN98 1109.20 -630


(Fri Apr 17 1998 00:36 - ID#373403)
Palladium below gold. From second to third place for gold, that is scary. Living in Chicago, I have seen something in second place move to third before.

(Fri Apr 17 1998 00:38 - ID#57232)
G'Nite all! --- Venezuelan foreign reserves
Highrise: Thanks! My mind is mostly asleep, despite the commotion tonight. If the Venezuelan currency is tanking, they will sell dollars, gold, whatever they have in their reserves to prop up their currency. The comment about 1.5% per month devaluation vs the dollar caught my eye -- what we are seeing I think is the SEAsian currency 'flu' taking hold in Venezuela. Then Brazil?

Yes -- I think you are right -- I think it was Venezueala that sold all of their gold reserves last year.

We need to be nimble now -- change is on the wind again. Tornado warnings all over central US tonight, too ( See Matt Drudge ) .

G'Nite all -- try to get some sleep because tomorrow may be busy.

(Fri Apr 17 1998 00:40 - ID#267298)
I am no intellectual, but I agree with you 100 percent.

I believe that there is one thing that you must keep reminding
yourself of constantly, and that is, all this NEGATIVE PROPAGANDA
directed at Gold comes from the West.

Gold is no longer a store of value, but rather just another Commodity,
Then why the hell didn't the Korean Government ask it's people
to turn in their pork bellies and soyabeans instead of Gold ?

Gold is dead, Why is ( as for as I understand ) the demand for
Gold in India still on the rise rather than the decline ? A country
in which Gold is fundamental to its customs, religion, etc.

Why do many of us in the West still place a Gold Ring on the
finger of our soul mate ?

What is the Commodity that just might give the EURO a chance
at challenging the US $ ? Pork bellies ?

Ask almost any person from Asia, the Middle East, and a great
many from Europe, what they would rather you give them today,
300 US $'s or an ounce of Gold ? What do you think they would
choose ?

Sorry for the delay, had to attend to something....

In any event, you get my drift,

Remember always where this PROPAGANDA is coming
from, and fear not......

(Fri Apr 17 1998 00:42 - ID#256250)
comex quiet. Palladium still looking quite interesting...

warehouse stocks:
-- GOLD ( Quoted in Troy Ounce )

475,158 0 0 0 0 475,158
159,146 0 0 0 0 159,146
634,304 0 0 0 0 634,304


-870,765 0 32,924,864
-965 0 55,190,922
-871,730 0 88,115,786


Yes silver stocks dropping once again.



Gold 18,000
Silver 24,000
H.G. Copper 15,000

Paper gold trading 1.8 million ounces and not a single physical ounce of gold moved in all of comex. Interesting, isn't it.


FWN: 090654 GMT

"There is concern about the decree being signed, and
then of course, it's ( also ) down in sympathy with silver,"
said Savaiko.
Still, the market remains uncertain just when to expect
the resumption of Russian shipments. Over the past couple of
days, traders and analysts have been saying it's hard to
tell exactly when exports will resume, pointing out it could
be days, but then again, it could be weeks.
When Kiriyenko's signature on the order was announced
by an official at the State Precious Metals Reserve, the
official was quoted as saying exports could begin "today or
tomorrow." However, shipments now depend on contracts being
agreed upon by the export agency Almazjuvelirexport, which
has warned that delays are still possible, pointed out
analysts at GNI Research.
"I'm not so confident the Russians are going to step up
their PGM ( platinum group metals ) exports any time soon,"
said Savaiko. "It probably will be at least another month or
two at the earliest."
GNI analysts, in their daily commodities report, said,
"Export licenses still need to be agreed, but in our
opinion, once the quotas have been set, the ball is rolling
and the process could be quite swift."


And Russia's government is in such good shape. Sure they have the palladium and platinum situation under control.


Russia's Yeltsin Denies Reports of Health Problems

Yeltsin today shrugged off reports of health problems
after Russian media said Yeltsin was rumored to be in
Speaking on national television, Yeltsin said he is as
healthy as can be, and that his hospital visit was to see a
dentist to have a tooth crowned.
Yeltsin told reporters, "Everyone should keep calm. The
usual question has been raised about the president's
Yeltsin said, "I did indeed go to the clinic, for half
an hour, to have a tooth fixed. Someone saw something
somewhere--a reporter, a foreigner, not one of ours, saw me
going to the Kremlin clinic, and immediately they say the
president is ill. Ridiculous, isn't it?"
Kremlin officials said Yeltsin wanted to get the tooth
done before he leaves for a two-day visit to Japan.
Yeltsin's spokesman called the health rumors "nonsense"
and said they were aimed at "aggravating the internal
political situation."
Yeltsin has decided to fly to Japan despite a near-
certain rejection by the State Duma, the lower chamber of
parliament, of his candidate for premier Sergei
Russia has been without an official prime minister and
government since the end of March, when Yeltsin unexpectedly
sacked his former premier and the entire cabinet.
Yeltsin's upcoming Japan visit will involve a 10-hour
flight, the longest trip the 67-year-old leader has taken
since last year.
Last month, Yeltsin canceled a series of meetings and
was told by doctors he couldn't make a three-hour flight to
his home town of Yekaterinburg because of his health.
Yeltsin's presidential jet is fully equipped to handle
any medical emergency, and has been dubbed "the flying
hospital" by one Moscow newspaper.


You just have to love them. They have a story a for every situation.
If only they were as good as the USG spin-masters then ...

Look at the open interest in gold for june ... WOW!!!
On April 1 1998 it was:
June 98 28002 80328 + 830


-- GOLD --
Finals for April 15
Contract Volume Open Int Change
April 98 43 413 + 0
May 98 0 4 + 0
June 98 23014 100458 - 166
Aug. 98 185 8091 - 65
Oct. 98 114 4812 - 57
Dec. 98 520 16760 + 339
Feb. 99 394 8616 + 267
April 99 0 7246 + 0
June 99 130 11810 + 72
Aug. 99 1 453 + 0
Oct. 99 0 204 + 0
Dec. 99 0 6150 + 0
Feb. 00 0 0 + 0
June 00 0 4463 + 0
Dec. 00 0 4992 + 0
June 01 0 2152 + 0
Dec. 01 0 4866 + 0
June 02 0 1459 + 0
Dec. 02 0 60 + 0
Total 24401 183009 + 390

Goodnight all.

(Fri Apr 17 1998 00:43 - ID#401237)
Japan Chart

Somebody is buying ? Rocket UP!


John Disney__A
(Fri Apr 17 1998 00:43 - ID#24135)
Rangold reflections
For swp1
I believe the Rangy problem is related to brett Kebble.
When Brett comes in the door .. guys climb out the windows.
Many were burned - me included - in the DDeeps takeover of
Blyvoor and Buffels... people dislike kebble because he cost
them dough. I dont like him either. He is some king of a
visionary bullsh!t artist with lots of chutzpah. If gold
goes UP He will deified.. If not crucifiction would be more
in order.
I think this is one of the reasons that Harmony has out
performed Deeps .. and Rangy. It is a Kebble free stock and
it therefore has the respect of the people that run the
Institutions HERE. All this will be forgotten IF gold gets
above 330 $/oz. If you have noticed .. Volumes in Harmony
has been massive here and tiny overseas. The reverse is true
for Drooy and Rangy. I hold some rangy but only preferred stock
for Drooy ( 20% yield but VERY thin ) and of course options.

(Fri Apr 17 1998 00:44 - ID#340302)
A goldbug's words are preserved upon a computer chip forever... aren't you worried that your anti-Establishment, anti-status quo polemic will come back to haunt you someday?

This question is a paraphrase of yet another gold antagonist's comments on this forum.

I always wanted to address this question...and the time has arrived finally where I can do so.

The answer: no, I am not afraid. I am proud of every single word. I want to shout it to the world.

I opposed it. I opposed this rampant, over-speculation in the financial markets. I opposed the greedy Wall Street opportunists ensconced in the Fed.. and at the Treasury...and in the Government.

I called it for what it was....a madness...a societal sickness...a mania...a bubble..a fever that would end in national tragedy.

I wrote about the issue every day. I screamed "FIRE..THERE'S FIRE HERE!" Can't you see it? Can't you smell it?


Believe me, I am proud. If I should ever face any negative repercussions for the "warnings" I posted, then I will face them as man who believed in his convictions and stood by them.



(Fri Apr 17 1998 00:52 - ID#287129)
farfel ( it a glee club for gold?)
Farfel, you made some very valid points. While I would normally favor objective forums, I must agree that the mainstream media is anything but objective when it comes to PMs. They are so pro-stock and anti-gold that it is both disgusting and frustrating.

Are the other investment forums objective? I've not had time to surf them; but somehow I doubt it. It would be my guess that they greatly discourge people from buying PM's...which EVERYONE should own as insurance against a stock market crash.

If we do have a major turnaround, I wonder what kinds of comments the general public will have to say about those who so strongly discouraged them from buying gold and PM's while they were affordable.

Also, you quite effectively illustrated your points with those who build their houses on foundations of gold and silver, etc...


(Fri Apr 17 1998 00:55 - ID#284255)
oleman . . Thu, Apr 16, 8:41PM CST ( -0600 GMT )
We're setting up a possibility for a nasty drop here and now. But the May buy will be a biggie, IMO.

oleman . . Thu, Apr 16, 8:53PM CST ( -0600 GMT )
twocents: Cause Rubin knows he needs a strong buck to keep fokes buying our paper, which allows him and his cronies to continue to rule the world. Nothing major.: )

(Fri Apr 17 1998 00:56 - ID#286224)
@John Disney_A

Thanks a lot. As I fully expect gold to be in the $10 - 30,000 ( US ) range shortly Ithink I'll do all right with my DROOY; though I may switch to Harmony just in case.

By the way, I saw a very nice picture of foggy ocean shoreline around Capetown - is ocean very cool there, is fog common?



(Fri Apr 17 1998 00:58 - ID#197211)
The further the Yen drops, the more profit japan will make on US Bonds they hold. The will sell those Bonds sometime on the way down, then watch out.

(Fri Apr 17 1998 01:14 - ID#340302)
...but remember, there is a two-way street in the world of gold...
A Wall Street propagandist's anti-gold rant...his New Paradigm-scam advocacy...they, too, are preserved on a computer chip forever.

When the pendulum swings back again someday soon, there will be a new regime with radically different perspectives of the world...

...there will be a record of every financial opportunist's gold short slander...

...there will be a record of every Wall Street analyst extolling the virtues of P/E's at infinity...praising the verticality of the financial bubble...singing the song, "THE TREND IS YOUR FRIEND."

...all preserved on a computer chip for the evaluation and analysis of the next Establishment.

Where will you stand on that Judgement Day?



(Fri Apr 17 1998 01:21 - ID#284255)
Joke a day
But what I was telling you was that there is a pair in the toolbox under the seat."

(Fri Apr 17 1998 01:29 - ID#255284)
aurophile mozel alberich vronsky BIS Critical thinking and a Competition for Goldbugs

I, too enjoy haunting the cloisters at old Goldbug U. May her ivy walls stand firm as a Clinton against the fiercesome force of the fetid unbelievers.

Yes, the Lucas Possum Indicator is working with its usual consistency at the moment, giving me a reading of short term gold panic with a spike down expected before 30/6. Thereafter the beam just points up in a beautiful arc before the model becomes unstable.

took your advice and e-mailed the WGC.
Here's what they said:

The latest figure for the total sum of gold ever mined is 132,200
tonnes as at the end of 1996. This is reported by Gold Fields Mineral
Services Ltd and can be taken as a "best estimate". If you would like
to contact Gold Fields Mineral Services, they can give you more
information. Their phone no is + 44 171 828 8040 and fax + 44 171 233

According to latest information supplied by the IMF in their
"International Financial Statistics", the BIS held 193 tonnes of gold as
at December 1997.

( change the "ba" to "go" ) :
Johnstone states that the BIS has had the following two long term goals:

1 ) To destroy the Soviet Union, as a threat to world peace.
2 ) To destroy the dollar as the worlds reserve currency.

and goes on to say:

"Along about 1972, I began to spend a great deal of time and
effort in studying the BIS and its agenda. The first thing I
found was that although the U.S. had turned its back on
gold, the BIS were aggressively buying it. By 1990, the BIS
were by far the largest holder of gold, with more than one
billion ounces. This amounts to an outright corner on gold."

Now, there is quite a difference between a billion ounces of gold i.e. 31,000 odd tonnes that Johnston would like his sons to believe, and the 193 tonnes that the IMF say the BIS hold.

I suppose the 'true' number is between the two? I know that alert kitcoites do not need to be told to do your own homework and to use critical thinking when reading anything on the net, even at the Bald Eagle.

And, Mr Johnston, if I've told you once, I've told you a thousand times, don't exaggerate! It only defeats your cause.


I am thinking of holding a raffle, a sweepstake, I dunno what you call it a competition in the spirit of all Great Kitco endeavours, I call it:


ALl entries should be posted@kitco in this format:

"BIS ={your Guess} Tonnes of Gold -- Ha Ha Ha"

Entries not in the above format will be disallowed.

The winner will be announced on kitco. Please contribute your ideas on the prize, even better, please contribute your prize...


Lan Man
(Fri Apr 17 1998 01:31 - ID#320108)
Stability in the Financial Markets  NOT!
A Reason to Own Gold

"The derivatives holdings of U.S. commercial banks increased 26.5% over the first nine months of 1997, up 50% from 1996. Chase Manhattan's derivatives exposure is equal to U.S. GDP and the U.S. banking system as a whole has $62 in off-balance sheet derivatives for every dollar of equity capital and $5 for every dollar of assets on the banks' balance sheets. A loss of 1.6% on the banks' derivatives portfolio would be enough to wipe out the ENTIRE EQUITY CAPITAL OF THE U.S. BANKING SYSTEM. ( emphasis mine )

"The Bank for International Settlements reported in November that $82.6 trillion in derivatives were held by 79 selected financial institutions in major nations at the end of 1996. Chase Manhattan was tops on the list with $7.9 trillion or 31% of all U.S. bank derivatives. Chase had $364 of derivatives for every dollar of equity and $22 in derivatives for every dollar in assets. Next was J.P. Morgan with $6.2 trillion or $537 in derivatives for every dollar of equity. Seven top banks had $109 billion in equity and $1.7 trillion in assets compared to $24 trillion in derivatives, or $220 in derivatives for every dollar in equity and $14 in derivatives for every dollar in assets. They had 26% of all U.S. bank equity, 35% of U.S. bank assets and 95% of the derivatives. In the first nine months of 1997 about $190 billion of asset-backed securities were issued, up 23% from 1996. It should be noted that J.P. Morgan's final 1997 quarter reflected $54 million in derivative losses and they designated $587 million of assets as non-performing derivatives for a total possible loss of $659 million. Now, if this isn't enough to scare you, you have serious problems."

( As copied from The Reaper 4/9/98 p.10 )

Monkee Person
(Fri Apr 17 1998 01:51 - ID#288105)
some people just don't get it and it's worth repeating
Ultimately, the one in big trouble here is not Japan. Oh yes, some Japnaese companies will be plowed under; but it is the U.S. which has the most at stake here. Don't be fooled from that. Fundamentally, the U.S. is in a much more precarious position. Japan knows it.

Japan has its own internal problems, certainly. Yet, am I the only one to discern a grin about to break into a laugh when a BOJ official is asked to comment on some dire circumstances the U.S. is threatening.

FWIW: only holdings are Delta and Alta, plus the obligatory physical.

(Fri Apr 17 1998 02:06 - ID#153102)
@aurator 193 HaHaHa
I think it has been published here that all of the CB's hold about one third of the world's total. Neighborhood of 30,000 tons.

So, if what was meant is that BIS "controls" a billion oz's, all the mustery is solved, provided one accepts that BIS can control any member CB's disposition of its gold. I think in a loose sense of the word "control" that is probably so.

Has Veneroso or anybody actually found out which CB's were doing the infamous gold loans ? Was there a paper published on this concept at IMF or BIS that has surfaced ? ( Not counting the Fed Reserve "study" )

(Fri Apr 17 1998 02:17 - ID#284255)
Millennium Mess
Gartner Group, which surveyed 6,000 companies and government bodies worldwide, concludes that the percentage likely to experience failures of critical systems has surged to between 30 percent and 50 percent, up from 10 percent a year ago.
Four-day break planned for the millennium.
That means most Britons will be able to usher in the new millennium with a one-off midwinter long weekend.
setting the stage for a massive national celebration.
Year 2000 bug: banks must tell the world or be cut off
The message from American financial sector leaders was that if Australian banks did not send clear signals to the international financial sector about their millennium preparedness they would be disconnected from the international financial system.
"They must start saying it loudly and publicly internationally so they don't get turned off," he said.
"It is important that for the sake of Australia's future economic performance and international credibility its financial services sector does not become one of these weakest links."
Dutch warn Kohl on millennium bug -- paper
"Kok expressed his concern that the Dutch economy could suffer economic damage if Germany does not do more to resolve the Year 2000 problem,''
Now they start to blame each other?

(Fri Apr 17 1998 02:19 - ID#153102)
@Lan Man
US National Debt has increased 136 $ Billion this year. Not all of this has been to monetize treasuries presented by Japan in my judgement. I think the Fed has been putting liquidity in US banks to cover derivatives losses. Picture the same going on in Japan.

(Fri Apr 17 1998 02:24 - ID#255284)
Well if Rhodes can name a country, we can all un-name one.
Yes I have CPM figures that total just over 1 billion oz of gold for all the CBs. But to lump them all together is to suggest that the BIS *already* controls over 20 Cbs including all the CBs heading into the EMU and US Fed and CBs of Japan, Australia & Canada.

BTW in view of the fact that Australia has sold much of its gold, I propose that the Continent be renamed. She is not worthy to bear the illustrious "au" prefix. No, I propose hereinafter we refer to "that continent" as Stralia.

But I digress

I find it impossible to believe that the BIS already has this control. This is what Mr Johnstone is suggesting. I'm not that hot on conspiracy theories. Well, until they are proven true, anyway.

(Fri Apr 17 1998 02:26 - ID#255151)
April 17

A lot happened this day in history. J.P. Morgan was born, Ben Franklin died, the Dow hit 3000 for the first time, and Mickey Mantle hit the longest home run in history. can enter any day at--

(Fri Apr 17 1998 02:38 - ID#255304)
@ all
Brother can you spare a new paradimes!

(Fri Apr 17 1998 02:50 - ID#153102)
Stralia. Fitting so far. A few more screw ups and it may get snipped down to Al and start receiving mail misrouted for Alabama. It could happen.

Checked out BIS on control of CB gold. Learned BIS holds deposits for CB's, I think, up to 120 of them. Also, BIS functions as Trustee and Agent for member and associate CB's. So, it is somewhat of an exaggeration to say BIS controls 1 billion oz of gold, but, practically speaking, conceivably not that far off the mark. It is, after all, the CB's Central Bank.

(Fri Apr 17 1998 03:06 - ID#339212)
N. AM. Palladium -PDLCF kicked out of NASDAQ
Due to the heavy losses of the company, the Nasdaq kicked its a** out.
Year end results just anounced, get some librium and read:

@ PREACHER: Will this dog survive?

(Fri Apr 17 1998 03:11 - ID#255284)

Donja love kitco?

(Fri Apr 17 1998 03:18 - ID#153102)
I think you have the theme.
The post on derivatives exposure really shows what $100 trillion of risk portends for a banking system. It is difficult for me to conceive that there is not 1.6% of losses out there right now. If South America currencies start to burn, there will be a new round of losses. The potential problem of gold derivatives at LBMA pales in comparison.

Japan has the largest National Debt as percentage of GDP. Japan has the largest amount of foreign reserves. Japan has 40% of the world's savings. Japan's banks are broke. The yen needs defending. Something is really screwy about the Japanese financial system. I think what they call books would be undecipherable to a Western auditor.

There was a time not too long ago when the idea that there could be a PPT intervening in the US equity market would have been unthinkable. World socialism = world crash.

(Fri Apr 17 1998 03:23 - ID#284255)
Avid chatter
just for fun: some stat: swiss market is now at valuation of nikkei 1989! and we are about 12% beneath about that?..just for laugh..

I am going to short the internet stocks tomorrow, YHOO , XCIT, THNK, SEEK, all of them.

good idea, but I would have thought that they were good shorts when they were 50% cheaper than they are now. The situation looks like the terminal phase of a mania.

I wouldn't be surprised to see the stocks end up at 0 within the next few years. The old timers can tell you about the tech stock craze of the late 1960s. Same type of deal.

To be honest, I thought they could have been shorted many points back. I equate them to Beanie Babies. You know they aren't worth anything, but you have to let them run their course. There will be some horrendous losses in these stocks.

personally i think to short at this time, one has to be very careful since many stocks go up despite worsening be long seems safer , but what do i know....with the flood of money coming, it may flow to many nook and crannies.

5/31/29 dow made a low of 290 which was the final low in a 4 month hesitation. 65 trading days later, the top was made.
on 5/20/87 dow made a low of 2188 after a 2 month + hesitation, 67 trading days the top was made.
We are now 65 trading days from the 1/12/98 low of 7447.

Today was a set-up by "them". I saw it taking shape yesterday. I could tell by the action of the PREM what was going on, they were selling the future on every little up move, all day long. I have seen this before just before a down move, usually the day before. The selling was relentless but controlled all day long, the perfect set up. Almost all the action was accomplished in the first 2 hrs. the rest of the day was churning. Just depends how much 'they" want to take it down where it goes. FWIW I think one more day. Tomorrow may be sideways and down on Mon after expiry. Who knows.. I just don't trust a controlled down move= it's usually a bear trap.

i think it would be beneficial to study nikkei and yen charts in order to practice for bear which must come, to know what a bear's rally is...

in many countries ( coming trend ) and now in japan, you have a 2 tier thing: co's which export ( multinational ) using cheap labor at sweat shops and which are muscular, and co's which are domestic ( national ) which are weak and susceptible to domestic conditions.

since japan has been in a recession, its imports is low and it needs a cheap yen to export ( same theme: weakness is old demography and strength is export ) ....however much one can understand fundamental, its technical picture should also be looked at....if you take a multiyear yen chart, you may be able to see why the bearish trend is... ( as yen 160 becomes 90, japanese with yen feel like spending, but the trend reverses itself with reversal of situation and as aging progresses ) ....also check the tone of officials, how they respond ( jap officials are just interested in manipulating the market and avoiding the problem given past history and how they came to power )

now as big bang occurs, and the snowball effect occurs, ma/pa will invest see the won, i have on paper only, but i would suggest looking at a few closed end funds and open funds and check out, it should go hand in hand pretty much.

also the market demands a huge tax cut and stimulus which the deficit hawk at m.o.f. won't give, they promise in 1999, perfectly in time for yen 160 and end to nikkei slide as nature continues to take its course.

there is such a thing as undervalued, grossly undervalued and staying that way for years ( the reverse is us ) ....nikkei was expensive at 25000 and ultimately it went to 40000......i would love to buy asian assets next year if it follows course and hongkong earlier when i think i see a bottom....and there is such a thing as fighting a wave which proceeds to crash ashore.

i hope china clings on and not devalue, and it has the political/financial will to do ( equal to japan in foreign reserve ) .....bec the future of asia is china and it has to provide stability/leadership to region.

so i don't think it is a war soros vs rubin bec soros will ride the wave so long as he cannot spot shore, and rubin only tries to stabilize things, smooth things out as it is foreign affair and usa can be seen as intrusive...japanese officials have told foreigners to mind their own affair.

also the cheaper yen never helps the Japanese people, just like the stronger yen never helped them REASON, the benefits never gets passed thru to them, that is one of the biggest factors that has angered then Japanese. The trading companies of Japan which are huge are thought to have BILLIONS stashed somewhere, becuase no one can figure out where all of their profits went. They never show up in their books and they never reduced prices to benefit consumers...

the charts of skorea also provides good study for playing the oversold condition ( usually easy 30% ) and the resumption of down movement hopefully to only retest the low....btw i don't think gold has the same appeal this time around bec of trend in demonetarization.

Here is a perfect example about what is wrong in Japan... Debate on permanent tax cuts to take 1-2 yrs--MOF

Your remarks about Asia are thought provoking. Japan has been an emerging economic power in the last thirty years or so and has built up quite a tightly controlled noose around its smaller neighbors. The parallels between Japan/USA today versus USA/British empire in the twenties are striking.

one can certainly draw that parallel, history repeats itself too often?...i suspect the whole situation is an eventual handing of the baton to china in the long term

Just pulled a book off the shelf called " The rise and fall of great powers" by Payl Kennedy. It is dated 1987. The economist predicted China's GDP would soar past combined total of Britain and Italy by year 2000 and vastly exceed any european power by 2020. wonder if that prediction is on track.

Asian stock markets looking a bit tired tonight. Tomorrow should be a very interesting day. Samurai may be right about this thing falling off a small cliff soon.

oleman . . Thu, Apr 16, 10:33PM CST ( -0600 GMT )
You're a sly one. You wanna see a stab of the 1099 and an ujp close. That way you get to see your TOP before Memorial Day. Aint gonna do it. Gonna sell off about half a hundred handles, then go to 1250 by fall. Then FALL!

Any reason ( news ) for the sudden fall on the globex or did a support just fail ?

overseas nervousness? it's time? only guesses, of course. : )

I am wondering if globex is for real or faking before tomorrow?

Looks real to me : we had a down day with 700 million shares and a major Dow non confirmation high with SPX not confirming and the Nikkei getting within 1000 points of its 10 year low .Also looks like the globex took out a support line . On a Dow daily chart the uptrend line sits Fri at 9025 area . Close below that and all the chartists go bearish .

these new circuit breakers are gonna be just like a new toy on Christmas.... those floor boyz gotta take it outta the box and see if it works.

(Fri Apr 17 1998 03:24 - ID#153102)
Kitco is the most interesting place I know. Real people.

(Fri Apr 17 1998 03:34 - ID#255151)
Japan Stats

John Disney__A
(Fri Apr 17 1998 03:49 - ID#24135)
for swp1
Sometimes there is fog near the coast. In
winter we catch a lot of weather. The Atlantic
is cold. False bay is less cold. It is very
dramatic and beautiful country.
It is after all a cape .. a little like being
at sea .. and the weather changes quickly.
South Australia has more beautiful sunrises
and sunsets however, but less pretty countryside.
Where I am is valleys and mountains and vineyards
.. stunning.

(Fri Apr 17 1998 04:05 - ID#39828)
Some ugly feeling, I cant explain.
If US largest debtor nation, and Japan largest creditor nation,
why is the US kicking ass. Thems the dumb bastards that borrowed
it in da first place. sheeeesh . Japan should of boycotted the
G7 and G22 talks. Or did they?

(Fri Apr 17 1998 04:10 - ID#255284)
Nothing like the All Blacks, anywhere.....
In a decision that rends my soul in two, and that of Noo Zilund, the rights to watching live All Black Tests in NZ free to air was lost yesterday. We are no longer able to watch the world's best golden rugby team, the All Blacks win time after time after time, country after country without paying the damned SkyTV. Yet another birthright has been sold to the highest bidder.

I doubt anyone but sharefin & his Dad, Kiwi, and any NZ or Welsh or Barbarian lurkers know the gravity of this news. Truly, the world has gone mad.

(Fri Apr 17 1998 04:13 - ID#284255)
The Kitco Co., it offers more to the world than a business, "it provides a stage for minds to meet"!
ANOTHER's transcripts updated

Dow/Gold ratio

XAU/Gold ratio

CRB/XAU ratio

Gold/CRB ratio

Swing chart
Oscillators heading below the centre line.
Big crunch coming but will it be the last?

(Fri Apr 17 1998 04:16 - ID#39828)
IMF to reform bad practices. Practice, they have only been practicing.
Friday 17 April, 1998 ( 12:00pm AEST )

The International Monetary Fund has adopted a "code of
good practices" aimed at providing more complete
information on the financial health of individual countries.

The move, following discussions in Washington, is the first
step in averting future Asian-style currency crises.

In a closing communique, the I-M-F said the code was just
one of several initiatives it would pursue to better monitor
the economic activities of its member countries.

It expressed guarded optimism that the Asian currency crisis
was on the way to being resolved.

But it said Japan still needed to do more to boost its flagging

The I-M-F also said the nations at the centre of the crisis -
South Korea, Thailand and Indonesia -- must move
aggressively to implement economic reforms.

Return to the World News Menu

plus from the Asia Pacific Region in Indonesian, Chinese and Tok Pisin

 1998 Australian Broadcasting Corporation
Fri Apr 17 12:30:01 1998 ( AEST )

AEST = Australian Eastern Standard Time

(Fri Apr 17 1998 04:23 - ID#284255)
Truly, the world has gone mad.
Now how are my dad and I
Going to chide those S'tralians no more

Dad's comments:
It ain't finished yet.
It's amazing what those bastards will do for money.

Divide the lie from simple truth
Between them is so fine a line
That how may I with honesty
That unsubstantial line define.

(Fri Apr 17 1998 04:24 - ID#255284)
No problem. No worries mate, only dogs worry,eh? Naaah. She'll be right.
G'day. Thanks for the charts.
Everything is being sold here. Assets that took generations to build have been flogged cheaply to those close to power. THere goes my rising star. Now, after our Telecom ( divs in 3 years = Purchase Price ) Railways, Govt Print, Forests, Fisheries, Electricity Suppliers, have all been privatised, there's little else to be sold off. Selling off the family silver to pay the groceries, down under, eh?

see ya

(Fri Apr 17 1998 04:28 - ID#252391)
Where is all the excitement
I'm having a problem staying awake. I think I'll start a new business: remedy for those you can not sleep - watch these markets soar. I doubt they'll be any problem buying metals today or for that matter on Monday at pretty much these prices. If Silver could get up to 6.45 I'd get excited especially on a close - but that's an if - better be content holding above $6.25.


(Fri Apr 17 1998 04:42 - ID#39828)
G,Day sharefin, aurator, jims. from behind
bLIHRY eyes.

(Fri Apr 17 1998 04:45 - ID#240120)
Americas bubble economy (Leading article in today's Economist)
AN ECONOMIST, it is said, is an expert who will know tomorrow why the things he predicted yesterday did not happen today. So what will be tomorrows explanation of why share prices continue to soar today despite frequent warnings from many commentators ( including The Economist ) that Wall Street is overvalued? The most popular explanation within America is that it has entered a new economic era of faster, inflation-free growth, and hence stronger profits, thanks to new technology and globalisation. We beg to differ: America is experiencing a serious asset-price bubble.

This weeks spring meetings of the IMF and the World Bank were dominated by talks about the slump in Japan and how to prevent another financial crisis like that in East Asia. These subjects certainly still matter. But it is asset-price inflation, especially in the United States, that now poses a bigger and more imminent threat to the global economy. Americas stockmarket has gained another 15% this year, taking its total rise over the past two years to a massive 65%. This is not the only symptom of a bubble: Americas commercial property market is starting to get frothy, and mergers are running at record levels ( see article ) . Shares surged on the news of the huge mergers between Citicorp and Travelers, BankAmerica and NationsBank, and First Chicago and Banc One. Ominously, merger mania is usually associated with the final stages of a bull market.

This talk about a bubble may seem odd against the consensus view that the American economy can look forward to many more years of steady, inflation-free growth. The consumer-price index rose by only 1.4% in the year to March, and is widely tipped to remain low, helped in part by a modest slowdown in the pace of economic growth as a result of the slump in demand in Asia. This is why the Fed has held interest rates unchanged over the past year. But while inflation in the prices of goods and services may be weak, another sort of inflation has become rampant.

The roaring nineties

Rising asset prices are not necessarily bad. In part, Americas higher share prices are justified by genuine improvements in performance. Deregulation, increased competition, better corporate governance, and more prudent fiscal policy have all played a partbut only a part. The boom in share prices has also been fuelled by excessive monetary growth. Americas M3 money supply has grown by almost 10% over the past year, its fastest since 1985. It is true that real short-term interest rates have risen in America as inflation has declined, but if calculated using the rise in asset prices rather than consumer prices then real interest rates are negative.

Americas financial bubble could harm its economy in two ways. It might suddenly burst, causing financial instability, destroying wealth and bringing about a recession. Or asset-price inflation may spread, causing over-investment and a consumer-spending binge as shareholders spend some of their capital gains. The inevitable result would be consumer-price inflation. In the late 1980s, rapid monetary growth first showed up in asset prices, but it was ignored, and so inflation spread. There are already some bad omens. Consumer spending is estimated to have risen at an annual rate of 5% in the first quarter of this year. There are some signs of a slowdown, but with unemployment at its lowest rate for almost 30 years there is no slack left in the economy to absorb such rapid spending growth.

With hindsight it is clear that the Fed made a mistake in not raising interest rates last year to let some air out of the bubble. Pricking a financial bubble is a risky business, and it is better to act early to prevent one developing. After fretting about irrational exuberance in December 1996, Alan Greenspan then went quiet. This is not to deny that the Fed faces a tricky task. It is legally responsible for ensuring price stability and full employment. And, since price stability is the best way to keep down unemployment, this means that its main duty is to watch inflation. But general price inflation has been falling, so it is politically hard for it to raise interest rates. If, in bursting the bubble, the Fed triggers a recession, it will get all the blame. As Americas 80m shareholders protest about their shrinking wealth, it might not be long before Congress acts to curb the Feds power.

Another problem is the enormous uncertainty about when and by how much interest rates need to be raised to cap asset-price inflation. There is no way to work out how much of a rise in share prices is justified by better economic fundamentals. As the Fed itself says: There is no means of knowing beyond question how far this recent rise in stock prices represents excessive speculation and how far a readjustment of values to increased industrial efficiency [ . . . ] and larger profits. Actually, it was not Alan Greenspan who said that. This is an extract from the Feds minutes exactly 70 years ago, in 1928, on the eve of the Wall Street crash.

The Fed needs to raise interest rates now. Uncertainty is no excuse for Mr Greenspan to sit on his hands. In the late 1920s the Fed was also reluctant to raise interest rates in response to surging share prices, leaving rampant bank lending to push prices higher still. When the Fed did belatedly act, the bubble burst with a vengeance. The longer that asset prices continue to be pumped up by easy money, the more inflated the bubble will become and the more painful the economic after-effects when it bursts.

Because the Fed has again left it rather late, it will be hard to prick the bubble without risking a recession. If one does come, central bankers have at least now learnt to ease monetary policy, if necessary, to prevent a dramatic crash in share prices turning into an economic depression. One way or another, Americas stockmarket is about to play a more important role in Americas monetary policy than at any time since the 1920s. It would be better if this were to happen sooner rather than later.

G o G o l d

(Fri Apr 17 1998 05:03 - ID#17796)
@Lan Man
I have for months been terrified about the effects of the next round of derivative losses. Have never seen the numbers you posted before. Wish I knew the extent of the derivative losses from S.E. Asia. The next big market or currency upheaval may crash several large financial institutions. Thanks for your post. Tom

(Fri Apr 17 1998 05:07 - ID#255284)
Hedgehog / Jeremy - thanks for the opening, I've been wanting to tell some economist jokes for a while:


A mathematician, an accountant and an economist apply for the same job.

The interviewer calls in the mathematician and asks "What do two plus two equal?" The mathematician replies "Four." The interviewer asks "Four, exactly?" The mathematician looks at the interviewer incredulously and says "Yes, four, exactly."

Then the interviewer calls in the accountant and asks the same question "What do two plus two equal?" The accountant says "On average, four - give or take ten percent, but on average, four."

Then the interviewer calls in the economist and poses the same question "What do two plus two equal?" The economist gets up, locks the door, closes the shade, sits down next to the interviewer and says "What do you want it to equal?"


1. Economists are armed and dangerous: "Watch out for our invisible hands."
2. Economists can supply it on demand.
3. You can talk about money without every having to make any.
4. You get to say "trickle down" with a straight face.
5. Mick Jagger and Arnold Schwarzenegger both studied economics and look how they turned out.
6. When you are in the unemployment line, at least you will know why you are there.
7. If you rearrange the letters in "ECONOMICS", you get "COMIC NOSE".
8. Although ethics teaches that virtue is its own reward, in economics we get taught that reward is its
own virtue.
9. When you get drunk, you can tell everyone that you are just researching the law of diminishing
marginal utility.
10. When you call 1-900-LUV-ECON and get Kandi Keynes, you will have something to talk about.


Talk is cheap. Supply exceeds Demand.

Bentley's second Law of Economics: The only thing more dangerous than an economist is an amateur

A true story:
"I heard this from one of my professors. To protect him, no names will be revealed. This professor was about to get married. He went to the jewelers to get a wedding ring for his fiancee. The jeweler told him that he can have the inside of the ring engraved with the name of his fiancee for an additional $20 ( remember, this was a LONG time ago ) . He said, "But that will reduce the resale value!" The jeweler was aghast. He said, "How can you say such a thing. You are a butcher!" "No," replied the professor, "I am an economist"."


An economic forecaster was known to have an horseshoe prominently displayed above the door frame of his office. Asked what it was for, he replied that it was a good luck charm that helped his forecasts.

But do you believe in that superstition? he was asked, and he said, "Of course not!" But then why do you keep it? "Well," he said, "it works whether you believe in it or not."

The story is actually told about a non-economist, Danish Nobel prize winner Niels Bohr.


Economist related joke: Definition: Policy Analyst is someone unethical enough to be a lawyer, impractical enough to be a theologian, and pedantic enough to be an economist.


I can go on---

Three econometricians went out hunting, and came across a large deer. The first econometrician fired, but missed, by a meter to the left. The second econometrician fired, but also missed, by a meter to the right. The third econometrician didn't fire, but shouted in triumph, "We got it! We got it!"


Q: How has French revolution affected world economic growth?
A: Too early to say.


\Economist poem

If you do some acrobatics
with a little mathematics
it will take you far along.
If your idea's not defensible
don't make it comprehensible
or folks will find you out,
and your work will draw attention
if you only fail to mention
what the whole thing is about.

Your must talk of GNP
and of elasticity
of rates of substitution
and undeterminate solution
and oligonopopsony.


Q. What do economists and computers have in common ??
A. You need to punch information into both of them.

Why does Treasury only have 10 minutes for morning tea ??
A. If they had any longer, they would need to re-train all the economists.


You want more?

had enough yet?

(Fri Apr 17 1998 05:14 - ID#284255)
Why shouldn't gold skyrocket one day soon?
HEY, I'm as excited as anyone about the big Citicorp merger with Travelers which "will create the largest financial institution in the Western Hemisphere."

The deal, which "was not preceeded by the usual crop of rumors," is rightfully being heralded in newspapers because it "marks the further trend towards consolidation of banking institutions in this country and possibly, too, foreshadows the time when banking institutions may have nationwide branches, the final touch needed to make American banks supreme in world finance."

I'm having a little fun with you. All the words in quotes above actually came from a news report on the merger of National City Bank, the predecessor of Citicorp, with another bank called the Corn Exchange Trust Company.

There is one thing I forgot to mention. The merger between National City and the Corn Exchange Trust Co. was announced on Sept. 19, 1929. The deal was never completed because the stock market crashed a few weeks later.

The parallels between 1929 and now aren't perfect. Back then there wasn't as much speculation in the market by regular people as there is now. So when the market falls it will probably fall harder this time.

(Fri Apr 17 1998 05:21 - ID#255284)
If your skating on thin ice, you might as well dance. Jesse Winchester
know what you mean. The only thing on my wall so far, apart for a post card of Swans Island is Donald's gold/dow ratio since 1903. Look at those sheer cliff faces. The land of Tsunami, no?

(Fri Apr 17 1998 05:23 - ID#284255)
Dangerous to raise rates - WHERE?
Dangerous to raise rates before recovery--BOJ
TOKYO, April 17 ( Reuters ) - It would be dangerous to raise interest rates before the Japanese economy returns to a self-sustainable recovery, Bank of Japan ( BOJ ) Deputy Governor Yutaka Yamaguchi said on Friday.

``We know the negative aspects of having low interest rates. But it is dangerous to raise interest rates before the economy returns to a self-sustainable recovery,'' Yamaguchi told the budget committee of the Upper House of parliament.

If interest rates were raised now it would have a negative effect on matters that are sensitive to movements in interest rates, such as asset prices and investment, Yamaguchi said.

He added that he was worried that such negative effects could eventually have a negative impact on personal income.
My younger sister was having one of her first gynelogical appointments and she had some questions for the doctor.

"Doctor" she asked, "I can't ask my parents, They would kill me but my boyfriend wants to have anal sex. I don't know what to tell him, I mean I don't know anything about it. Can I get pregnant?"

The kindly old doctor smiled whimsicaly and replied "Of couse, you can my dear. Where do you think lawyers come from?"

(Fri Apr 17 1998 05:32 - ID#255284)
what's the cute little acronym or emoticon for "wiping the spit off my screen?"

(Fri Apr 17 1998 05:33 - ID#330175)
June Gold UP .40 @ 310.20
Mornin Aurator~~~~~~~

(Fri Apr 17 1998 05:35 - ID#330175)
Where'd ya get the Swans Island postcard,eh?

(Fri Apr 17 1998 05:35 - ID#284255)
Japan News
Japan smelters fail to reach accord with Ok Tedi
Moody's puts Nissan ratings under negative review
FOCUS-Financial markets keep up pressure on Japan
World economic leaders agree to disagree on Japan
U.S. Treasury Secretary Robert Rubin summed up what seemed to be an almost universal conviction by the majority of leaders gathered for the semi-annual meeting of the International Monetary Fund -- financial institutions must be revamped, but the key to Asia's recovery lies in reviving Japan's economy.

``A sustained global expansion and recovery in Asia cannot be achieved when the second largest economy in the world ... is in recession and has a weakened financial system,'' he told the IMF's policy making Interim Committee.
Goal to boost Japan economy so BOJ can up rates-PM
*** More hedge lifting***
***It's the trendy thing to do***
Camelot lifts gold hedge as A$ weakens

(Fri Apr 17 1998 05:37 - ID#255284)
'Evening Ted

(Fri Apr 17 1998 05:38 - ID#255284)
Post card from a good friend. Hope to meet him someday

(Fri Apr 17 1998 05:43 - ID#330175)
currently knawin my friend~~~~~S&P futures down 5.40

(Fri Apr 17 1998 05:46 - ID#284255)
The one I like.

BOJ says able to cope with any financial collapses

``The BOJ stands prepared to cope with any kind of future financial firm collapses,'' Hayami told a news conference in Washington following a meeting of the Group of 22 ( G22 ) nations.

``I told the G7 ( Group of Seven ) nations and G22 countries that Japan's financial system worries are easing compared to last November when they were at their worst,'' Hayami said.

Gone to cook for the girls - bbq - bbl
And a bottle of 'Tatachila'
Great SA - OZ that is, cabernetsauvigonshiraz

(Fri Apr 17 1998 05:46 - ID#330175)
Aurator...................& guess ya ain't in Cape Breton
Evening,huh?..sunrise is soooo bright and glare so bad can barely see the stoopid screen,eh...Beautiful morning being enjoyed by Willy&MOI...

Mike Sheller
(Fri Apr 17 1998 05:56 - ID#347447)
aurator, farfel
auracious - the auraciosity of it! Your economist jokes superb! Thanks for the laffs.

farfel: re your :03 -read it with glee

(Fri Apr 17 1998 06:14 - ID#413109)
Watch the US$
In the past whenever the dollar weakened gold started going up with
the foreign currencies. I believe the time has come for a repeat
performance. Next week should be a swinger for golds!!!

(Fri Apr 17 1998 06:20 - ID#255284)
Economist jokes part 2, on average

You shouldn't encourage me:


Newlan's Truism: An "acceptable" level of unemployment means that the government economist to whom it is acceptable still has a job.

Q Why did the market economist cross the road?
A To reach the consensus forecast.

Q: What does an economist use when calculating constant-dollar estimates?
A: Deflator mouse


Two men are flying in a captive balloon. The wind is ugly and they come away from their course and they have no idea where they are. So they go down to 20 m above ground and ask a passing wanderer.
"Could you tell us where we are?"

"You are in a balloon."

Said the one pilot to the other:

"The answer is perfectly right and absolutely useless. The man must be an economist"

"Then you must be businessmen", answers the man.

"That's right! How did you know?"

"You have such a good view from where you are and yet you don't know where you are!"


Seen the light yet?


Q: How many Chicago School economists does it take to change a light bulb?

A: None. If the light bulb needed changing the market would have already done it.

Q: How many mainstream economists does it take to change a light bulb?

A1: Two. One to assume the existence of ladder and one to change the bulb.
A2: Two. One to assume the existence of latter and one to change the bulb.

Q: How many neo-classical economists does it take to change a light bulb?

A: It depends on the wage rate.

Q: How many conservative economists does it take to change a light bulb?

A1: None. The darkness will cause the light bulb to change by itself.

A2: None. If it really needed changing, market forces would have caused it to happen.

A3: None. If the government would just leave it alone, it would screw itself in.

A4. None. "There is no need to change the light bulb. All the conditions for illumination are in place.

A5. None, because, look! It's getting brighter! It's definitely getting brighter !!!

A5. None; they're all waiting for the unseen hand of the market to correct the lighting disequilibrium.


one more


Q: How many Wharton MBAs does it take to change a light bulb?

A: Only one, if you hire me. I can actually change the light bulb by myself. As you can see from my resume, I've had extensive experience changing light bulbs in my previous positions. I've also been named to the Wharton Light Bulb list, and am presently a teaching assistant for Light Bulb Management 666. My only weakness is that I'm compulsive about changing light bulbs in my spare time.

yet anuver--

Q: How many investors does it take to change a light bulb?
A: None - the market has already discounted the change.

Economics is the painful elaboration of the obvious.


*over and out*


(Fri Apr 17 1998 06:27 - ID#26793)
More on your post at 5:14 about the Citicorp-Travelers merger. Thavelers is a local company and the local paper this morning has a story about the merger of the databases containing information about 70,000,000 customers. All medical and credit card histories combined in a single file. Think of the privacy issues.

(Fri Apr 17 1998 06:29 - ID#330175)
Aurator-------------Great Jokes......
a local mess=

(Fri Apr 17 1998 06:35 - ID#26793)
Russia warns of more platinum-palladium delays

(Fri Apr 17 1998 06:40 - ID#26793)
Congress and the Fed uneasy about bank mega-mergers

(Fri Apr 17 1998 06:46 - ID#26793)
Japan angered by comments at G-7 meeting

(Fri Apr 17 1998 06:55 - ID#411331)
@All: the Kitco 15 min. delay spot gold and silver graphs seem to be unavailable
Is Kitco down, or is my system malfunctioning?

(Fri Apr 17 1998 06:57 - ID#185448)
I Just read the following:
( ... ) First of may, the head of ECB gets constituted. At this time it will be fixed, how much Gold the reserves of the european curencies contain, how much gold by that is for sale and if the european govts will be bound to a EZB-directive. ( ... )

As the source has been trustworthy so far, I didnt want to withhold that info to the united kitcoista.

Agree with the idea of renaming the island to Stralia. Received only this year 2 letters via Stralia. We already tried to reaname Soundofmusicland to "Stria" - this was rejected, as Stria turned out to be a medical term in connection with pregnacy. So we are forced to wear T-shirts when abroad, showing a "kangaroos ahead"-sign and the writing "Austria - Sorry, we dont have kangaroos". But this is an unpleasant condition.

(Fri Apr 17 1998 06:58 - ID#238295)
JEREMT: Thanks for posting the ECONOMIST article! Shows some in thr international financial elite are EXTREMELY WORRIED about the stock market bubble, What they don't say is that this bubble has spread to Europe from the United State. So if it is pricked here, it will burst there as well.

Gold investors should never forget that the century's two biggst gold bulls -- the early 1930s and the 1970s -- cccurrred after the two biggest stock market bubbles ( prior to this one, of course ) had burst. And one of these gold bulls took place in an era of deflation and the other at a time of accelerating inflation.

Bully Beef
(Fri Apr 17 1998 07:10 - ID#259282)
I'm preparing the press release for the midday news....
Gold gains 10 dollars this morning while the Cow ( sorry,Dow ) loses 5% on speculation that stocks may be overpriced. We have an in depth interview with Bonnie the Blonde weather girl on where the Dow is headed and how it got there. But first a message from our sponsor! Fidelity...We make money from thin air...the old fashioned way.

Crystal Ball
(Fri Apr 17 1998 07:15 - ID#287375)
Thanks for the charts!

(Fri Apr 17 1998 07:55 - ID#247257)
charts and ratios
1. Can you post your email address again for the charts. I had problems with sending my letter.

2. Can you please explain the meaning of the ratio and is the gold market improving when the ratio goes up or down and - i f exists - a cutting point where you know that it is definitely a gold or a bear market.

Thank you

(Fri Apr 17 1998 07:57 - ID#57232)
Just how much gold does the BIS control?
mozel, aurator: As the CB's bank, the BIS buys gold either for its member banks, or for itself. So -- does it control only the official 100+ tonnes or so, or thousands of tonnes? I don't think we will ever know just how much gold it controls, but certainly alot more than the amount of gold officially listed.

Why do I agree with the both of you about this? The answer lies in Antony C. Sutton's comment in his 1975 book titled 'The Gold War'where he says that in the early 70's the US and IMF were at odds with the BIS because the BIS wanted the US $ price of gold to be higher. According to Sutton, the BIS was able to coerce the US by threatening to call in some kind of debt instrument. Unfortunately I have been unable to contact Sutton. My reasoning is that there is only one kind of debt that the BIS deals in -- borrowed gold.

Mozel -- this goes along with one of your comments -- namely that the BIS does not need to worry about their gold in other banks, because for some reason it is safe. That says a mouthful.

This topic reminds me of what ANOTHER said about the gold game, and it bears repeating. He said that the name of the game is to get all the gold. Then he said the next part of the game was to loan it out again with strings attached, because it was worth 'alot more' when it was being 'used'.

What if the BIS/Rothschild's control much more of the world's economic system than meets the eye? Just how many corporations/banks do the Rothschild's really own -- certainly alot more than Debeers, Royal Dutch petroleun and a number of banks. So even the US might not risk defaulting on a debt to the BIS, because the BIS could probably -- through its connections, seriously jeopardise the ability of the US to float debt on the world markets. Most of this control is probably well hidden, and subtle, but effective.

Perhaps this explains why the Chinese gold buyers are causing so much commotion? Their gold was bought outright, and there are few attached strings that the BIS/Rothschilds can use to maintain control.

(Fri Apr 17 1998 08:02 - ID#286199)
Myrmidons early a.m. warning bears repeating
North American Palladium PDLCF is being de-listed from Nasdaq after a really bad year.

(Fri Apr 17 1998 08:04 - ID#284255)
Free charting package & GE
Crystal Ball
Here's a good chart of the current mania - GE
Considering GE has the greatest market cap in the world,
You can see the excesses that we have risen to.

Now if 'My Precious' can only fly so high.

If they are to have a database of 70 million customers,
And they are trying to hide their losses ( like Swiss banks were rumoured to be doing )
And they were to sustain further huge losses,
Then they would end up with 70 million pi**ed off customers.

The bigger they are the harder they fall.

Could you please email me the gold prices back to 1900 in ascii format.
Then I will be able to do a Dow/Gold ratio chart back to that period.
I only have gold back to 1977
Want a free charting program to watch the US Indices plus 100 stocks.
Includes the Dow30 plus internal indicators
I have been using the package for over a year now.
It's good cause you can miss a few days then go back and update.
Avid Chatter:
vol yeaterday was quite big at 696 million. breath negative at 3/1 . merck numbers a concern . some of the sectors that got beaten up have been the better performers so far this week . its tech reaction. outlook for today not good. rumours in Japan that s&p are about to downgrade japan's AAA debt rating - it looks like sentiment is so negstiv that people fear the worst. statements overnight from the jpn fininance min that tax cuts will not be permanent do not help, the above accounts for the nikkei performance, and that of course gave a negative sentiment to the rest world. DEM a bit easier as well as buba president tietmeyer in the us last night said that the buba are not signalling any tightening for the time being.
buba rates unchanged
hey techs irrelevant; like cendant WE FALL 50%

My god is it true are we finally going to have a correction. I just can't help thinging that today they set up for the last move up, but the charts are saying no way we brake support so 1100 here we come. I am shorting these internet suckers. YHOO,XCIT,SEEK,LCOS

(Fri Apr 17 1998 08:04 - ID#185448)
Duisenberg: Not only an excellent car
According to Dutch Prime Minister Wim Kok would block the vote of a french candidate ( = Jean-Claude Trichet ) as head of the future ECB with a veto.

The majority of european countries support dutch candidate Wim Duisenberg. French govt demented reports that Germany and France would have definitely selected Duisenberg asides of the last G7-meeting.

(Fri Apr 17 1998 08:20 - ID#26793)
My e.mail address is I need your postal address in order to mail out the charts.

The Dow/Gold Ratio prices the Dow Jones Industrial Stocks ( 30 companies ) in ounces of gold rather than points or dollars. It allows a direct comparison over the 100 year life of the index that is not clouded by inflation.

The XAU/Spot index does the same for the XAU index and permits a pricing in ounces over the 15 year life of the index not muddled by inflation.

As to predictive value it provides a different wave pattern to examine. For example, over the life of the XAU the spot ratio has varied between .164 and .397. Historically speaking, gold and silver mining stocks are bargains at the low numbers and become risky at the high numbers.

For the Dow/Gold ratio a median price early in the century was 2 to 3 ounces. Mid century the median price was 4 to 5 ounces. The 1929 peak was 18.43 ounces. The 1966 peak was 28.61 ounces. Our latest peak was 30.54 on March 20th.

I do not have any comment on the Gold/Silver ratio not having done much work with it yet. Perhaps someone else will comment.

Mike Sheller
(Fri Apr 17 1998 08:46 - ID#347447)
OLD GOLD -6:58
Either way, INflation or DEflation, we are on the verge of another historic assest inversion. Actually, INflation has been, and is now, proceeding merrily. The greatest amount of newly created credit in man's history has been absorbed by the financial institutions and industrial powerhouses of useless instruments and consumer waste.
A retrenchment to the discipline of gold will evaporate much of the garbage spawned by the last several decades of social frivolity and lost culture. Material things are good. But we dont need fifty five different 4 wheel drive vehicles competing to take us to the Mall every Saturday, do we? Not while human beings continue to sicken, starve, and live in squalor in every nation on earth. I believe TOTALLY in free choice and free markets, so don't mistake what I am saying for a call to legislation or government control. I think intelligent human beings had better wake up and discipline their own choices for the future of their own children and grandchildren. That starts with economy and basics first. Those basics will evaporate and turn us all into barbarians if the financial profligacy of nations, and the YK2 denial continues much longer. New York City without police or electricity will hardly be an electric situation. I like to sound the warning during good times. Anyone can point to the clouds during the storm. The less developed nations of the world will do well to adopt a free banking gold standard and free market oil resource policy quickly. They will have the aggressive flexibility to become FREE now, and will survive better than the behemoths who would be their masters with "special drawing rights" charity later on, when gold ( and oil ) is at astronomical currency prices.

(Fri Apr 17 1998 08:48 - ID#286199)
SWC will post first profit this quarter
President Nettles on CNBC this morning, defended himself well against the quizzing of the analysts. His take on the Russians is that they have been shipping in previous years out of their reserves and can't keep it up much longer. North American Palladium is in trouble so the only major non-South African platinum/palladium play is Stillwater. The price should go down some more as Russian shipments hit the market, but the 24-25 range is probably the bottom. bwdik

(Fri Apr 17 1998 08:49 - ID#340459)
Friday's Asian Market roundup

SYDNEY, April 17 Asia Pulse - Share prices closed broadly
lower across Asia today, with falls recorded on all main
indices except Bangkok, which rose 1.7 per cent, and
Singapore, which recorded no change at all.
Once again, regional concerns undermined investor
sentiment, with traders particularly worried by the prospects
of more bad news from Japan.
In Seoul, share prices dropped 0.86 per cent, with trade
shrinking to the lowest level recorded so far this year.
Selling by institutional and foreign players amid jitters
over labour strikes and a political stalemate pushed the
leading composite stock price index down 3.92 points to
The Australian sharemarket closed marginally weaker, but
off its lows in lacklustre trade, with investors taking
profits and choosing the sidelines ahead of Wall Street's
opening tonight.
The all-ordinaries index closed down 13.9 points, or 0.48
per cent at 2867.5, after trading between 2881.4 and 2858.6.
In Tokyo, share prices closed 1.1 per cent lower in active
trade dominated by the sale of futures.
The Nikkei Stock Average ended at 15,703.80, down 179.97
Concern over the Japanese economy and the weak yen
influenced trade in Hong Kong today, forcing the market into
negative territory.
The benchmark Hang Seng index fell 186.46 points, or 1.7
per cent to close at 11,001.32.
In Manila, the release of weak first quarter results in the
corporate sector and a further decline in the value of the
peso caused share prices to fall 0.4 per cent.
The composite index closed down 8.45 points at 2,176.10.
The Singapore bourse recorded no change today, with
investors sidelined by concerns over the Malaysian corporate
sector and the Japanese economy.
The Straits Times Industrials index ended flat at 1,515.15.
A slight technical rebound saw the main index in Kuala
Lumpur close off its lows but down 0.08 per cent, with
investors staying out of the market following a spate of
corporate failures.
The KLSE index fell 0.56 points to close at 628.78.
In Jakarta, share prices closed 0.42 per cent lower, with
investors cautiously awaiting the results of talks with
international bank creditors in New York.
The composite index fell 2.166 points to close at 507.902.
The Thai bourse recorded the only positive result amongst
the main markets in Asia today, with a 1.7 per cent rise on
sparse buying in thin trade.
The SET index climbed 7.36 points to finish at 438.99.

* SYDNEY - All Ords 2867.5 ( down 13.9 points )
* HONG KONG - Hang Seng 11,001.32 ( down 186.46 points )
* SEOUL - Composite 450.23 ( down 3.92 points )
* TOKYO - Nikkei 15,703.80 ( down 179.97 points )
* MANILA - Composite 2,176.10 ( down 8.45 points )
* SINGAPORE STI 1,515.15 ( no change )
* JAKARTA - Composite 507.902 ( down 2.166 points )
* KUALA LUMPUR - KLSE index 628.78 ( down 0.56 points )
* BANGKOK - SET index 438.99 ( up 7.36 points )

Gianni Dioro__A
(Fri Apr 17 1998 08:54 - ID#384350)
Taxes and Govt Spending
People should try to put into relation taxation and govt spending and its inflationary and deflationary effects.

Govt spending is generally inflationary whereas taxes bring back those excess dollars and are in this way deflationary.

In the 1930's govt spending and taxes were much, much lower than they are today. There was somewhat of a gold standard as well, and therefore the 30's were deflationary in face of falling stock markets and credit contraction.

In the 1970's tax revenues dropped and spending exploded. There was no more gold standard and inflation was rampant.

When you look at countries that have experienced hyper inflation, they are usually low-taxed countries and when their govts dramatically increase their spending the currency is devalued, however there are few taxes to reign in the inflationary effects. The people then see that the currency is being devalued and avoid this paper money like the plague, getting out of it as fast as possible and buying tangible things, perishable or not.

If/when the stock markets crash this time around there may be some initial deflation especially in overvalued assets ( stocks, commercial and some residential real estate ) , but I am almost certain that Govt spending will continue to grow, and tax revenue will sharply curtail ( no more cap gains ) . This ultimately spells inflation.

Gianni Dioro__A
(Fri Apr 17 1998 08:54 - ID#384350)
Japanese Debt
I suppose that the Bank of Japan ( Central Bank ) holds a large part of the Japanese Govt debt. Why don't they just forgive the debt. I doubt it cost them anything. Many govt's debt could be whisked away if only their central banks were nationalised.

Crystal Ball
(Fri Apr 17 1998 08:56 - ID#287405)
@ Sharefin
Thanks for
While you're shorting internet stocks, don't forget AOL ( P/E 300 )

(Fri Apr 17 1998 08:57 - ID#340459)
@CrystalBall - 07:15 Enjoyed your Post.
Perhaps we are at crossroads today, will be very interesting.

Crystal Ball
(Fri Apr 17 1998 09:04 - ID#287405)
@ Sharefin
Interesting that while XAU was up the last two days, its largest component, ABX, was down a little both days. Divergence? Yesterday's bounce of 80 cents in GCM8 was just a bump in the road. All indicators point lower short and intermediate term. I'm not selling any of my precious, but I'm holding onto my ABX puts as a hedge.

Crystal Ball
(Fri Apr 17 1998 09:09 - ID#287405)
Thanks. Don't you hate it when people say, "All that glitters is not gold." So, all things that glitter are not gold, huh? I'm sorry, but SOME THINGS that glitter ARE gold, like my pet St. Gaudens here. :- )

(Fri Apr 17 1998 09:19 - ID#288369)
Hide your beautiful Saint because forty peopleo think they own her too. We may have to fight for these girlfiends.

On ANOTHER matter, simply put...It a privilege and a responsibility to post on Kitco. My greatest gratitude and admiration to those who do.

(Fri Apr 17 1998 09:21 - ID#284255)
Well worth a look
Interesting site to browse:
It has gold/silver and many indices going way back in time.
It has the South African gold index going back to the turn of the century but alas only by the decade.

Crystal Ball
I think that with gold in an up trend that the moves up will tend to come from nowhere - of a shorter and steeper duration with each leg.
It could well fall another few $ before catapulting upwards.
I suppose it all depends on the ammount of manipulation that will be put into play with the coming correction.

(Fri Apr 17 1998 09:23 - ID#288369)
@EB, I need new specs.......
it=it's....boy, my J-school profs would be proud.

Spud Master
(Fri Apr 17 1998 09:24 - ID#273112)
Gianni Dioro & Inflation
Inflation is Theft. Period.

When a mugger puts a gun in your face and says "empty your ATM account" you probably don't like it.

When a politician inflates the currency it is no less a crime; only for some reason we make all manner of excuses to exculpate this criminal and his criminal actions.

Hard to think of all those sharp dressing, smooth talking, "feel your pain" politicians as common criminals, but that is what they are.

Wake up before you end up like so many Cambodians in the killing fields, this time run by "kinder, gentler" Washington bureaucrats under order from the Clinton cabal: from all accounts, Pol Pot was just as charming and elegant a speaker.


(Fri Apr 17 1998 09:24 - ID#251166)
From Kaplan's page (updated this Friday morning)
The price-to-earnings ratio of the Standard and Poor's 500 Stock Index ( average stock price divided by average
earnings per share ) was exactly 28.2 at its intraday high on Wednesday, April 15, 1998, a new all-time record.

(Fri Apr 17 1998 09:25 - ID#351224)
@sharefin/Tanami desert
re your post last night. Are my maths correct? 1.3 kilos equals approx 45 ozs @ say $Aus 150 gross profit. $AU6000? Doesn't seem like much to me! For all that equipment, investment etc. What say you?

(Fri Apr 17 1998 09:25 - ID#26793)
Comments on trade gap numbers by several economists

(Fri Apr 17 1998 09:33 - ID#288369)
@Like our famous EARL says......
It's about time we made some serious bread....I damn sure need to. Go ahead GOLD, do your thing, baby. Off to the office to pump oil to give it away. "Put the word "profit" in every sentence you speak"....C.W. Murchison.

(Fri Apr 17 1998 09:36 - ID#243166)
Spud Master -- Right On
You are absolutely correct; criminals all. The largest crime is the fact of all the additional taxes being stolen from us due to inflation and thus the necessity of most families requiring two incomes to maintain a per annum gold equivalency to that which required only one income less than twenty years ago.

The biggest lie of recent history is the criminals telling us that inflation is under control. When will the masses awaken from their long slumber?

(Fri Apr 17 1998 09:37 - ID#340459)
DOW is up, ????????????
Crazy Markets, huh ?

(Fri Apr 17 1998 09:39 - ID#228100)
Mike Sheller et. al.
Agree with your forecasts, but personally, I'm not certain what to do about the situation. Physical PM's are great, but do you think US government debt, bank deposits, and greenbacks will be worth anything in a few years?

This whole Y2K issue is amazing. Every company that I've worked with in the past year or so has no real plan for even testing that their financial systems and/or operations.
For instance, a large chemical conglomerate ( based in Wilmington, DE ) is paying a consulting company to "assess" their systems. Hundreds of $150/hour geeks have been playing around with code for almost a year, and they still don't have a clue if the systems will work in 2000. After they find problems, they'll still have to fix them. The consultants don't care, they're paid on an hourly rate!

(Fri Apr 17 1998 09:48 - ID#401460)
Midas__A Dow is Down!

Crazy markets YES!


(Fri Apr 17 1998 09:49 - ID#401460)
June Gold



(Fri Apr 17 1998 09:50 - ID#284255)
Isn't 6.5 g/t a good grade
Your maths is good.
It's a lot of rock.
200t @ 6.5g/t = 1300g = 45.8oz
46oz @ $450 = $20,700 gross
46oz @ $150 = $6,900 profit

These guys just keep pouring out the rock.
I suppose they have to.
It's a very highly mechanised business.
That's why I was asking how computer reliant/Y2K reliable, these companies are.

Thanks, I received the email.
I sent you a couple in return.

(Fri Apr 17 1998 09:57 - ID#251268)
Looks to me
like all eyes are going too be focused on just how many
billion the Japenese will dump today before they commit for the weekend
looks good to me for gold,wwith a multitude of factors that could
push it higher and short specs finaly getting leary of getting on the
wrong side of this market.Still a little hard to rationise getting up at
2. am to watch paint dry but I expect things will start juming soon or back to bed. ( anybody catch Pat Robertson on cbn last couple days?
last night had interviews with to forensic experts in defence department
who got major flack for Ron Brown situation and the night before a whole piece on Vince Foster's death.I give Him credit for He is certainly putting himself in harms way for raising ?s abbout these coverups.Should have transcripts at cbn website )

Spud Master
(Fri Apr 17 1998 09:57 - ID#273112)
@Woody & Year2000
Woody - you are also dead-on target about inflation in the US:

We are being told lies.

The American press, instead of doing investigative reporting, and checking prices, merely repeats the fraudulent CPI & PPI figures told to us by Washington D.C. criminals.

Who will challenge these fraudulent PPI & CPI figures? It's like Winston Smith in Orwell's "1984": if the Party controls all memories, how can anyone get objective facts?

I myself collect prices on 31 items I need to buy weekly - it is stunning to see the prices increase by 11% last year.

We ALL know there is rampant inflation; yet like dodo birds in deep, deep denial, we say nothing. We are fat ( literally ) dump & happy right now, so we are just going to keep walking toward the clearing where the path ends.

@Year2000: You ask what the US Dollar will be worth in a few years? The same as a Russian Ruble: Nothing.

My greatest fear is that the US FedGov & banks will MANDATE all purchases and payments be made electronically - and that it will be impossible to buy food, pay mortgage, clothes etc unless you can produce an electronic debit card, or a credit-chip implant in your hand.

Spud: 1776 Now!

Buy Gold!

Repudiate the corrupt Federal Reserve Note that masquerades as the US Dollar!

When free people use gold & silver in commerce, we can not be manipulated by criminal politicans, nor have our money stolen by the politicians inflation-theft! ( ask any Indonesian/Malaysian if you need a refresher ) .

(Fri Apr 17 1998 09:58 - ID#238295)
I remain convinced that the next major move in AU will be up. But am still cautious on the very short term because gold stocks not acting particularly well relative to bullion. Until this changes, the odds of another pullback will remain high.

(Fri Apr 17 1998 09:59 - ID#284255)
Of market crashes
Secular Trends in Financial Markets

The secular trend goes through three stages. In the first stage, the new policies are introduced into the economy. Investors who realize how these changes will impact financial instruments will reap profits; however, it will take time for the new policies to be implemented, for individuals to be convinced that the changes will be permanent, and for those who benefited from the old policies to adjust their expectations and behavior. As investors change their investment patterns in response to the economic changes which are occurring, financial markets will persist in their trends. This stage corresponds to the bull market phase within the stock market.

During the second phase, the unintended consequences of these policies begin to surface. Controlling unemployment can lead to inflation. Free markets can lead to costly economic dislocations. Growth in emerging markets can reduce the demand for unskilled labor in developed markets. Even though the new policies are still creating profitable trends in financial markets, the underlying problems and stresses of these policies increase volatility and/or reduce the strength of the trend. This will cause the prices of some financial instruments to decline, even though prices as a whole continue to increase. This stage corresponds to the "topping out" or "blow off" phase in the stock market.

At some point, the stresses in the financial and economic policies become so large that they overwhelm the financial system. At that point, the market crashes. Normally, there are several corrections within a financial cycle rather than a single crash because the pain of the underlying economic problems have to become great enough that the government is willing to change the system rather than patch things up. Reaching this point takes time. This stage corresponds to the bear market phase within the stock market. At this point, a new paradigm is introduced and the cycle begins anew.

(Fri Apr 17 1998 10:01 - ID#251268)
Sorry for multiple
sp errors ( I haven't decided if its worth drinking coffee and staying up yet )

(Fri Apr 17 1998 10:10 - ID#251268)
Yeah just checked
the site got a piece on interns death and another
white house workers death also.

(Fri Apr 17 1998 10:20 - ID#285121)
<---- scratching head, gold up, Rangy down $^%^%&%
Go figure. OK with me this morning, my gtc order at $1.25 executed. : )

(Fri Apr 17 1998 10:22 - ID#25253)
1 Corinthians 2 14 ; The unspriritual man does not receive the gifts of the Spirit of god,for they are folly to him, and he is not able to understand them because they are spiritually discerned.

I want to share my first experance with discernment. I was going fishing with a couple of friends. On the way to the lake I told them my wife has been really mad at me. She says in the middle of the night I reach over and play with her butt in my sleep. I sayed no more about it. Five hours latter were at our room, three guys two beds. They thru there bags on one bed and sayed I could have the bed to myself. I discern gold up dow down.

(Fri Apr 17 1998 10:23 - ID#375108)
Myrmidion & Speed & NA PGMs
Thanks for posting the PDL/PDLCF news release. Liquidated a small PDL position on the TSE this morning in light of that and NASDAQ delisting of PDLCF. Meanwhile, looks like Nettles' CNBC interview has given SWC a boost this a.m... Howdy, Ted...

(Fri Apr 17 1998 10:24 - ID#333127)
A whole lota shaken goen on

(Fri Apr 17 1998 10:28 - ID#240120)
Spot Gold Heading North
Gold 308.50 309.00

G o G o l d

(Fri Apr 17 1998 10:42 - ID#31876)
Spud Master
When the printing presses were finally turned off in Germany
during the 1920's bubble, the public was invited to redeem their
old money for the new. The conversion rate was one trillion
PAPER marks to one GOLD mark!

(Fri Apr 17 1998 10:48 - ID#7568)

It could well be that the recent rise in oil prices is tied to massive lubricant demand for the printing presses. In one wee little week, our 'deflating' economy managed to pump out almost $33 billion dollars of fresh liquidity.

We are indeed in a liquidity trap, but like none that has been seen before. In order to keep the Asian economies from imploding, we are pumping money at an electrifying pace. Our growth is being minorly constrained by a ballooning trade and current account deficit.

We have now created on a worldwide basis, the same phenomena which has occured previously, only on an intra-country basis. Back in the mid-eighties, when the oil economy of the Southwest US collapsed, the Fed had the same sort of a problem. In order for Texas not to completely implode, the rest of the economy was treated to easy money. This resulted in the mini-bubble ( wasn't so mini back then ) of the 86-87 stock market. The liquidity did its job, but also brought with it, stock market inflation, and ultimately real inflation in 1988 - 1989. When the brakes were applied to that cycle, we got three sold years of stagnation.

This time around the Fed dares not raise rates, until the Asian crisis is over, and the Japanese economy is well on the mend. Any rate hike between now and then will be seen as a sign of economic warfare by the Japanese.

With all major industrial nations, adopting a policy of easy, easy, money, we are going to get growth. The economic reality is that growth and inflation always lag increases in liquidity. Politics however, will not allow for an end to the feeding frenzy until the lagging indicator of inflation rears its ugly head. By then it will be far too late for a tap on the brakes. Especially since the politicians control the inflation statistics.

Sit back, relax and try to figure out the next asset that is going to get bid to the moon. Shorting any asset in this environment is a bet that the liquidity is going to stop flowing sooner rather than later.

The stock market bubble is no doubt a bubble. The people plowing into 401K's etc, will never make the rational decision that prices are too high. The time for rational evaluation of companies has long since come and gone. Those that are feeding at that particular trough will only stop when the food ( liquidity ) is no longer there.

If you absolutely feel the need to be short something, find a bond market.

(Fri Apr 17 1998 10:57 - ID#225157)
George S Cole
Has George S Cole shown his face around here lately?

(Fri Apr 17 1998 10:57 - ID#57232)
Pat Robertson and 700 club
jman: Thanks for showing us what Pat Robertson is up to. He has decided to publicize the mysterious Clinton - related deaths. While I don't consider Pat Robertsons activities as reflecting the American Mainstream thinking, they are much more mainstream than isolated conspiracy websites on the internet, or even James Earl Davidsons newsletter.

Someone please correct me if I am wrong about this -- I think that Pat Robertson's public stand on this matter indicates that there is a growing mainstream awareness of the suspicious deaths of Ron Brown and Vince Foster, as well as that unfortunate woman who died inside the locked commerce building. You do not need to be a conspiracy buff to realize that all of these autopsy investigations were botched, at the very least. In the Ron Brown investigation, 4 AFIP autopsy Forensics experts have said it was botched/covered up -- the people that did or observed the autopsy.

Also, Kenneth Starr said today that his investigation will last well into Noveber, and that he is too busy to join Pepperdine Univ this year.

Lastly Paul Jones has decided to appeal her court reversal.

I think all of the XXXgate stuff is coming to a slow boil, and will come to a creshendo around no laster than election time yr 2000. BC's problems are not over, and he will be looking for a distraction with Saddam Hussein, especially if the markets start to wilt.

(Fri Apr 17 1998 10:59 - ID#271383)
Requesting information
Would any one know of a website that would be able to provide information
on delisted or defunct companies? Or companies that have been taken over? One company that I am looking for is Rhand Industries. It was listed on the Alberta Exchange under the symbol RII and later on NASDAQ under the
symbol RHANF. Another one is Eartwhile Developements Inc. It was last listed on NASDAQ under the symbol EHWDF.One more was Las Vegas Major League Sports Inc. under the symbol LVTD on NASDAQ.


(Fri Apr 17 1998 11:00 - ID#340459)
@Spud Master, You are right my friend but people fed on CNBC and CNNFN do not realize this.
It all boils down to mass confidence building. I personally think that Japan's troubles have been consistently magnified by global media propoganda which is compounding their woes. It is the largest Creditor country and US the largest borrowing country.
It is confidence building through media. CNN, MTV, Fox, girdle the globe and the World is looking at events through their vision, unfortunately. Anybody taking a different view is squashed as Rogue States or Terrorist Nations.

Aragorn III
(Fri Apr 17 1998 11:13 - ID#212323)
Keynes is rolling over in his grave ( I hope they buried him alive. )
Mozel, I gotta luv ya for that great one-liner! Prometheus--I appreciate your encouragement.

Strad Master
(Fri Apr 17 1998 11:18 - ID#250297)
He never left...
PETER: Rgarding George S. Cole: Check out his 5:58 posting.

Gianni Dioro__A
(Fri Apr 17 1998 11:20 - ID#384350)
So, are you saying that taxes aren't theft? Read my post again. I'm wide awake.

(Fri Apr 17 1998 11:21 - ID#188244)
Thanks, D.A.
Great analysis. One follow-up: How do you make the assessment that the Japanese economy is on the mend? My only impression is that is is hard to believe that excesses can be driven out of Japan while the world is on a liquidity binge. That, plus Rudi Dornbusch's pronouncement that Japan is on the verge of bankruptcy, raise doubts in my mind. ( On the other hand, in light of the same liquidity, how could Japan go bankrupt? ) This is where I thow up my hands. I can not assess the potency of the Central banks, which up to now I have veiwed as having little real power against the world economies. I think it is this piece that a lot of us here have trouble understanding- ( Puetz, perhaps? ) I'm of the Ricardian equivalence school, or more simply put the 'no free lunch' crowd, and it seems to me that the world has been gorging itself on a free buffet for quite a while now. Any comments?

Strad Master
(Fri Apr 17 1998 11:27 - ID#250297)
1st Fiat Bank
D.A. or ALL: Do you or does anyone here remember the date and/or time of your posting about 2 weeks ago wherin you explained in simple terms how money is created in Fiatland? I printed it out to save, and after showing it to my wife, she tossed it whilst cleaning up. I would love to get it back. If no one remembers, I'll have to go searching for it. Many thanks.

(Fri Apr 17 1998 11:30 - ID#31868)
The world financial system is being destroyed by the very fact that they
are running the printing press at will. This is the kiss of death. This cure is worse than the disease.

These markets are dead, dead, dead, they just do not know it yet.

YOU CANNOT INFLATE YOUR WAY OUT OF DEFLATION - The conversation wherein an individual tries to explain that the crash can be averted by adding liquidity is a false one. The crash in 1929 did not come about because of a lack of liquidity although the academics will swear this is the precise reason.

Throwing liquidity into the deflationary cauldron is like throwing gasoline on a fire to put it out.

Dead, dead, dead.

Not owning metal will be financial suicide.

(Fri Apr 17 1998 11:38 - ID#330175)
EB & ..........*GO LAKERS*------------------
to hell,eh~~~~~~~~~~~~

(Fri Apr 17 1998 11:39 - ID#257148)
insomniacs drool, OK?
Date: Tue Mar 24 1998 21:36 D.A. ( )

(Fri Apr 17 1998 11:40 - ID#57232)
Thanks for your insightful posts about inflation
D.A. Appreciate your post today, especially your commment about AG's unwilllingness to raise rates. He certainly does not want to aggravate Japan by making them think we are waging economic warfare by raising rates. They are undoubedly under more than enough pressure already.

I have a comment that supports your long standing opinion that inflation is what we need to fear in the US, not deflation. It relates to the trends of the producer price index, the consumer price index, and the wholesale price index ( an older version of the producer price index ) . The WPI is available back to the 1700's in the US. Pre - fiat currency days, the cost of living index ( WPI ) would go up, and then it would go back down. Now, however, from about the time we went of the official gold standard, a different pattern has emerged. The PPI/CPI still goes up -- much more rapidly ( which we already know ) , but the periods of time when the cost of living index should go down, it tends to remain stagnant.

So -- what we have done with our 'fiat' currency in the US -- post going off the official gold standard -- is eliminate most of the deflationary parts of the business cycle. Unfortunately as we all know the price we are paying is increased inflation.

This scenario supports your comment that inflation is what we will face , not deflation, as the name of the game has been to eliminate deflations and smooth our the business cycle since the great depression.

The catch is that, just as those Yellowstone forresters found out the hard way, there is a need for a cyclal, controlled burn to remove the nonproductive underbrush. Just as what happened with Yellowstone, one day we will have the granddaddy of a forest fire, and then we will realize that the business cycle is there for a reason. So eventually we will have the granddaddy of a deflation too. I guess the point is, 'don't mess with Mother Nature', either with forrests or markets.

There is one other inflationary item you did not mention in your post. There is at least $1 trillion in bad debt from SEAsia. My guess it is being repackaged in the form of some kind of a new debt instrument to get the creditors off the hook. This will surface as new inflation years from now when that debt becomes due again. This contributed to the inflationary crisis in the 70's ( and 80's? ) , and we ( the world's financial gurus ) will undoubtedly make the same mistake again.

(Fri Apr 17 1998 11:41 - ID#330175)
NOVICE............where ya been?...................*go Gold*
18 days......and counting~~~~~

Spud Master
(Fri Apr 17 1998 11:41 - ID#273112)
@Gianni Dioro
What do you expect? I'm an Ada sofwtare designer stuck doing @$#&*@#^ C and C++ software for the last two years - yea, you might say I am half brain-dead from this loathsome, half-assed excuse for a computer language that predominates our industry.

Just for the record: the C/C++ software maintenance problem facing America will make the Year 2000 Problem look like a cake-walk.

Any of you C/C++ people out there man-enough to run LINT on yer bloody code?

Spud, loather & despiser of liberals AND C/C++ software ; )

Aragorn III
(Fri Apr 17 1998 11:41 - ID#212323)
Strad Master RE: D.A.'s fiat lecture
To assist in your search, I recall posting two follow-up "lectures" on a friday around 18:00 three to five weeks ago. DA's post was earlier that same week, possibly a tuesday or wednesday. Happy hunting. Oh, and let me know where you eventually find it, ok?

Aragorn III
(Fri Apr 17 1998 11:42 - ID#212323)
Doh! Aurator, you are the man!
Hello Tolerant One!

(Fri Apr 17 1998 11:45 - ID#31868)
ARAGONIII - morning to ya.
Looking at the harbor, sailing in my mind, all the time.

(Fri Apr 17 1998 11:46 - ID#31868)
opps, ARAGORNIII - sailing
not spelling all the time.

silver plate
(Fri Apr 17 1998 11:50 - ID#234253)
Int'l confusion
Japan is the largest creditor nation.

US is the largest debitor nation.

But Japan is supposedly going bankrupt.

Is this because Japans credits consist mostly of the US debts?

Aragorn III
(Fri Apr 17 1998 11:54 - ID#212323)
Canadian Mounties...I have 'run the numbers'...
yet I hesitate to state what I know lest TolerantOne and others buy them before I can increase my meagre personal inventory.

John Disney__A
(Fri Apr 17 1998 11:54 - ID#24135)
Northam and Kalgold results
Northam Platinum announced quarterly results
today .. A profit of 6.9 mill rand on 184 mill shares.
So annually I make that 6.9 *4 =27.6/184 or .15 Rand
per share. It sold for as low as 1.35 Rand a few months
ago but has now moved up to 2.27.
The main interest in Northam is its big resource ..
one million oz of platinum.. 184 mill * 2.27 Rand = 417
mill rand for 100 million oz. That less than one $ per
oz and Thats cheap.
Kalgold also announced results .. 123 million share
and an operating loss of 1.67 mill for the quarter
after a 600 thou loss the prior quarter.
Kalgold have a resource base of about 2.2 mill oz
and they trade at 1.75 rand. 123 mill *1.75 = 215/2.2 =
97 rand or $19 per oz. Thats not too great as the
operation is highish cost so far.

(Fri Apr 17 1998 11:56 - ID#238295)
Looks like we're getting that short-term pullback I mused about this morning. Beware whenever the stocks don't act well relative to bullion.

(Fri Apr 17 1998 11:58 - ID#320376)
something in common
Spud Master, I, too, am an Ada developer who was stuck doing C/C++ code for the last two years, who enjoys Kitco.

I speculate that an affinity for gold has more in common with Ada than them other computer tongues. Gold and Ada have been dropping for many years, but some of us believe both have more real value than is generally understood.

Perhaps when we as a society come to understand the importance of reliable, maintainable software and a sound baseline for economics, Ada and gold will shine once more.

(Fri Apr 17 1998 12:00 - ID#20748)
Strad Master: D.A.s post on Fiat money
Date: Tue Mar 24 1998 21:36
D.A. ( ) ID#7568:
Copyright  1998 D.A./Kitco Inc. All rights reserved

I find it hard to believe that the persons writing the article on money
supply growth were actually economists. The idea that somehow money
supply growth due to high money 'demand' is good while growth due to
high money 'supply' is bad, borders on the absurd.

Since there appears to be a lot of confusion as to how money is created
in our system let me take a stab at clearing it up.

In a fractional reserve banking system such as ours, money comes into
being one of two ways. It is either 'printed' ( or electronically
created ) by the Federal Reserve, or it is electronically created by a
bank. Since there is little confusion about what it means to run a
printing press I will focus on the creation of money through the
banking system.

Let's posit a small society just starting out on a fractional reserve
banking system. On day 1, the Fed prints up $100 and distributes it to
the population. ( This is not quite how things started here in the good
ole USA but the genesis is of no consequence to the current state and
it's continuance ) Further assume that all of the money ends up in a
bank called First Fiat. On day 2, Bob the Businessman walks into First
Fiat and asks to meet Larry the Loan officer. Bob has a great idea and
all he needs is 90$ to get his website off the ground. After a few
minutes of due dilligence Larry decides that Bob is an OK guy and that
the 100 year loan should be approved. Larry hands Bob 9 crisp 10$ Fed
notes and away Bob goes. That very same day Bob meets Wanda the Web
designer who accepts Bob's payment of 90$ for her site design. Wanda
walks over to Second Fiat bank and deposits the 90$ just as business
closes for the day.

On the evening of day 2, Fred from the Fed walks around fiat land and
inspects the banking system. He finds that First Fiat has $10 dollars
in reserves ( $100 - $90 ) and $100 in deposits. Since the Fed's rule
is that a bank must have $10 in reserve for every $100 in deposits,
there is no problem over at First Fiat. Over at Second Fiat, Fred is
happy to find that the 90$ deposit is covered 100% by 90$ in reserves.
Fred duly notes that the Money Supply is now $190. This is the sum of
all the deposits in the system.

On day three Bob wakes up and decides he needs some more money for his
nascent business. He walks into Second Fiat, meets with Larry's brother
Leo, and walks out with $81 dollars. That very same day he heads for
Carl the Computer salesman, and buys the latest and greatest gizmo for
$81 dollars. Carl runs over to Third Fiat and deposits the money. At
the end of the day Fred from the Fed again makes the rounds. The
situation is unchanged at First Fiat, at Second Fiat there are only $9
in reserves, but that's OK because there are only $90 in deposits. Over
at Third Fiat there are $81 of deposits and an equivalent amount of
reserves. He duly notes that the money supply is now $271.

This process can go on up until the money supply is maxed out at cash *
the allowable deposit to reserve ratio. In this example, the multiplier
is 10 so the money supply will max out at $1000. In the end there will
be $1000 of deposits in the system with $100 of reserves backing these

In order for the money supply to grow beyond $1000, one of two things
must happen ( assuming that the reserve requirement is kept constant )
. The Fed must inject more reserves into the system either by buying
something and paying for it in reserve notes, or loaning reserve notes
to the banks. In our system the thing that the Fed buys is government
debt. Buy purchasing this debt ( monetizing it ) more reserve money is
added into the system. Each of these new reserve dollars can then
multiply up into the money supply by the same factor of 10 as before.
The second way the Fed can accomodate growth in the money supply is to
lend reserves to the banks. The banks can then use these loaned
reserves in order to meet the reserve requirements that Fred so
strictly enforces. In our example above, if First Fiat loaned out its
remaining $10 it would have zero reserves. Fred would be very unhappy
to come into First Fiat and find out that the reserve requirements were
not met. Fortunately for the folks at First Fiat, they could go the
discount window and borrow reserves from the Fed at the discount rate
to cover their shortfall.

If the banking system is getting by on borrowed reserves, then the rate
at which the Fed loans reserve money to the banking system will have an
influence on the rate at which the banks will subsequently loan money
to the public. Since they are in business to make money they will not
loan money at a rate less than it cost them to borrow it. As the Fed
raises the rate at which reserves can be borrowed it indirectly effects
the rates that banks will charge their customers for loans. In theory,
higher rates will dampen loan demand and growth in the money supply
will slow. If old loans are repaid faster than new loans are created,
money supply will actually shrink, assuming that the Fed does no
printing on its own. The Fed can also lower reserve in the banking
system by selling something ( again bonds ) and being paid in reserve
notes. This can get the system to a level of tightness where it again
must either borrow reserves or call in loans.

From the above, it is clear that the debt monetization which the Fed
conducts is but a small portion of the growth in the money supply. It
is the subsequent lending, redepositing and lending of this newly
created money which really is responsible for the bulk of the growth in
money supply. All this money ( 90% in a system with a 10% reserve
requirement ) is money which is fueled by the demand for loans. Because
the Fed can influence the cost of these loans its, it is always in a
position to dampen their creation.

If the growth of the money supply exceeds the growth in actual asset
creation, be that asset a building, a computer program or an airplane,
then over time, sure as the sun comes up in the morning, the amount of
money needed to purchase those assets is going to increase. This is
happening as we speak. The name for this phenomenon is inflation.

Much has been made here at Kitco of the idea that the gold market will
only go up when the equity market goes down. There is a general
misconception that somehow money will 'come out' of stocks and flow
'into ' gold. There is no money in stocks and there is no money in
gold. All of the money is in the banking system. Stock prices and gold
prices are just that, prices. Prices are indications of the amount of
money transfered from one party to another during the most recent
transaction involving the underlying asset.

Typically what happens in a cycle such as this is that the price of
some assets in the system are bid up to a point where the Fed believes
something is out of whack. This causes the Fed to stem the tide of
money creation through its actions on the amount of reserves in the
banking system. By slowing the growth of the money supply in relation
to the growth in the quantity of assets, the rate of rise in the price
of assets will slow. The tricky part is to slow the rate of growth
without stopping it. If certain asset classes have been bid to wild
extremes, like Japanese real estate in the late 80's, then stopping the
rise in prices may produce a downward countertrend which snowballs into
a deflationary collapse.

Since it is apparent that there is no level of excess in the stock
market that the Fed will not tolerate, there is no reason to believe
that the Fed will try and intervene against the growth of credit (
money ) except in other circumstances. They are boxed into a political
corner and must have a visible smoking inflation gun, or else they will
be shot at high noon for taking away the punch bowl when there is no
'reason'. As a result, this party will go on until their is measurable
inflation. With the way that the government measures inflation, this
could be a long time indeed. During this period of continued financial
largesse it is likely that assets which have not heretofore bin bid to
the moon will get their share of attention. It is here that gold may
find its footing. Just as stock markets rises generally do not end
until every trashy equity is selling at an astounding multiple, it is
likely that this general asset inflation will not end until even the
lagards such as gold have been well bid. It is likely that the increase
in price of these lagging assets will be the trigger which causes the
Fed to finally act.

The consequences of 'pricking the balloon' will be very hard to predict
in this environment but cash will no longer be a four letter word and
equities may well become one. The time for gold will be between now and
then. If its time has not occured when the music stops, its time will
not occur, at least in nominal terms, unless some radical change in the
banking system occurs. That will not be something worth betting upon.

Return to Kitco Homepage

(Fri Apr 17 1998 12:03 - ID#57232)
All: Someone on Kitco posted that Japan tends to avoid change until they are facing the brink. I think that makes sense, given their monolithic approach to government. I think they are approaching the brink and I think they know it. But -- they still have hard assets to fall back on - many efficiently run state of the art companies ( not all of them ) , and a positive balance of trade. So -- I think they will change and avoid total collapse, after that 10 year delay.

We, on the other hand will not be that fortunate when it is our turn -- we do not have the savings reserves to fall back on. When the big deflationary collapse finally gets us, it will be a short and painful trip to the bottom. Maybe months -- certainly not 10 years. And maybe not till 2010-2015, or y2k.

(Fri Apr 17 1998 12:03 - ID#210235)
@Donald, wanted to catch your eye. REPOST
Looks like we're headed down the slippery slope - wonder what we'll do for a foothold!

Date: Thu Apr 16 1998 22:25
Prometheus ( @Yo, Donald, stellar forecaster ) ID#210235:
Copyright  1998 Prometheus/Kitco Inc. All rights reserved
Found some evidence in this weeks ( April 11 - 17 ) Economist that the wave of deflation youve been watching in your
telescope is finally hitting. I am examining the Producer Price Index here, the first to be affected by changes in the

The 15 industrialized nations which they follow experienced fairly benign inflation as a group, when viewing their
year-over-year reports. 12 had low inflation, none as high as 2%. Of the 3 experiencing deflation, none was as low as
-2%. These years are Jan to Jan or Feb to Feb, excepting Austria, which has current data. Here were looking at a very
narrow band of change of rate here, nearly a flat plane.

But look at the first quarter 1998 over the last quarter 1997: Ten countries had deflation in their PPI, compared to 5
experiencing inflation! Three had -3% or more ( USA, Denmark, and Belgium ) . Two more had over -2% deflation,
Netherlands and Switzerland. Of the countries still experiencing inflation, Australia stood alone at over +2%.

Only two countries of the 15 saw their rate of inflation increase in the quarter compared to the past year, Australia and
Austria. Germanys inflation ground to a near halt at 0.1% and Italys inflation rate remained unchanged.

What have we got here? Nine of the 15 countries saw either a significant lessening of inflation or a cross-over ( 7
countries ) into deflationary territory in the first quarter. . The PPI is, of course a leading indicator to CPI. In the CPI we
had 2 countries crossing into deflationary territory in the first quarter ( Japan at -2.6% and Netherlands ) , with no
country reporting inflation over 2.2 percent ( Canada ) . No countrys CPI is inflating at a higher rate than Japan is
deflating! We see both PPI and CPI with the biggest numbers in negative territory! This is a major sea change in the
world economy. Bet A. G. and friends are poring over these numbers, too.

Could be time for some new ratios.

Aragorn III
(Fri Apr 17 1998 12:10 - ID#212323)
One of the "lectures" I mentioned...
Date: Fri Mar 27 1998 19:33
Aragorn III ( The Interest Issue... ) ID#212323:
Copyright  1998 Aragorn III/Kitco Inc. All rights reserved
Gold is frequently disparaged as a non-interest bearing asset. That is
not a reflection of the asset as much as a statement on its underlying
value. Interest is a phenomenon of *business agreements*, it is not an
inherent property of an asset or currency.
Two iron boxes. Gold in one, greenbacks in the other. Ten years elapse.
Boxes are opened. To no-one's surprise the same gold is found in the
first box. The second box is opened, and to everyone's horror the same
cash is found...but WHERE'S THE INTEREST?!!!
When debating which asset has better *inherent* properties, gold wins
every time.
The phenomenon of interest is a business agreement that by its very
nature and usage should give tremendous insight into the underlying
value of the asset. From the above example and from my earlier post is
should be clear that when the Federal Reserve lends its greenbacks (
while holding T-bills as collateral ) , it should seem no more realistic
for the Fed to expect the those greenbacks to multiply than when you
lend your step-ladder to a friend for temporary use. Do you ask for 110%
of your ladder to be returned? Interest is part of the business
agreement because the Federal Reserve ( and therefore all other banks )
knows the underlying value of the asset for what it is...a temporary and
ever-eroding confidence game. While the greenbacks are away on loan,
their purchasing power is diminishing, particularly because the Fed
knows it will eventually be printing more of them as required to pay the
interest on the original T-bills. The Fed and bankers benefit because
they are the first in the 'food chain' to receive the 'money from thin
air' ( interest ) and they can profit from it by spending it before
every hard working producer can compensate in-kind by raising the prices
for thier products or services.
Interest COULD be earned on gold. It's just a business agreement, after
all. I could lend you 500 tonnes of gold ( I'm very well connected! )
with the arangement that you will agree to return the 500 tonnes plus 50
tonnes as interest. On an individual basis this principle and the
mechanics are no different that the cash example where a banker lends
$500 and expects $550 in return. The borrower cannot *create* either
gold or greenbacks. The borrower must work hard, using the gold or cash
to support their venture, and *earn* the necessary gold or cash from
OTHER people in order to repay the original loan plus interest.
The DIFFERENCE is when you look at the big picture. The banker KNOWS
where the cash comes from and how quickly its value erodes. Having ( and
spending ) greenbacks today is better than having that same number at a
future date. True, gold IS being mined every day, but the additional
amount does not compromise the monetary system. There is sweat-equity
built into every rare and precious ounce. There is only USGovt debt
built into every greenback...which must find its eventual way back home
to the Federal Reserve to pay off the underlying T-bill--plus interest.
A business agreement where gold was used as money would indeed include
payment of some additional amount in consideration for making the
original loan. If that 'interest' were paid in gold, the rate would be
much lower than is used for cash, because gold today is NOT worth less
than the same amount of gold at a future date. The 'interest' paid on a
gold loan would be more akin to a share of the profits as an investor
would expect in whatever venture was undertaken. Gold loan for a house
purchase? Very low 'interest'; little additional metal required for
repayment. Why? Because arguably, the world supply of products and
services is growing at a faster rate than the world supply of gold. It
is reasonably expected that gold spent today is worth less than the same
amount of gold in the future. And if prices fall in terms of gold, no
interest is needed. You simply want your gold returned.
Interest gives insight to the inherent value. Remember that...

(Fri Apr 17 1998 12:12 - ID#210235)
@Good morning!
Sharefin - never miss your avid chatter. They are always worthwhile ( Sometimes funny, too, as this morning ) .

Aurator - Brabo! More economist jokes! More! More!

Mike Sheller - Your clarity of vision is unsurpassed. Those toe exercises must really work.

Studio - hope my good news has arrived by the time I get home!

Tolerant - I read your posts and the force of your convictions reinforces the force of my own.

You guys are an inspiration.

Going to go offline for a few days. Taking the laptop with modem removed. Wonder how hard the Kitco withdrawal will hit. Will I get up in the middle of the night at my host's home and log-on while they don't see? Or can I tough it out?


Aragorn III
(Fri Apr 17 1998 12:14 - ID#212323)
And the other one...
Date: Fri Mar 27 1998 18:25
Aragorn III ( Continuing education for weekend lurkers, D.A.'s Fiat 101
( continued ) ) ID#212323:
Copyright  1998 Aragorn III/Kitco Inc. All rights reserved
Tracking the ever-increasing US National debt from day to day is no
different than watching a keeps getting bigger and there is
no way to stop it. UNLESS...the method of payment is changed. By now
everyone should be aware that the private Federal Reserve is the
money-making proxy for the USTreasury because it is illegal for the
people's USGovernment to make money other than through a well-defined
recipe of this much gold or that much silver ( in coin form, and
denominated in DOLLARS ) . I will touch on the element that D.A. glossed
over as it pertains to the growing and unpayable national debt.
As warranted by social-economic-political conditions, and by the
shortfall in taxes received vs. Govmt expenditures, the annual
shortfalls in the budget necessitates creating dollars out of thin air.
But wait! Gold and silver don't come from thin air, hence the need for
using Federal Reserve Notes ( denominated in dollars ) in lieu of real
Here's how it happens...The USGovt does have the authority to borrow,
so that's what it does--through the selling of Treasury bills to
whomever will buy them. Of course, when they mature, more money is owed
than the value for which they were sold, and that is the INTEREST on the
National Debt. Historically, the Federal Reserve acted as the primary
buyer, and the Federal Reserve Notes were printed as needed to purchase
the Treasury Bills. The USGovt uses this "money from thin air" to pay
for all of the programs that cost in excess of its willingness to mug
taxpayers. This process continues year after year.
Eventually, some of the Treasury Notes come due and must be paid in full
which includes the interest. Paying off these debts becomes just another
one of the Govt's many annual expenses. Let's leap forward to a point
where the USNational Debt is say, FIVE TRILLION DOLLARS. All of the
money--excuse me, GREENBACKS--circulating in the system were originally
created via the process described above. A T-bill was sold by the USGovt
to the Federal Reserve. The Fed Res printed greenbacks in exchange for
that T-bill which it now holds with the expectation that the greenbacks
they printed will be paid back some future day WITH INTEREST. Wow.
Let me make my point clear with this example... If the USGov decided to
settle the National Debt tomorrow, and they called in ALL of the
GREENBACKS in the world, they would only have the money from the sale of
the T-bills, with no greenbacks left to pay the interest. How can the
Fed Reserve, as the sole source of greenbacks, expect to EVER get back
more than created to begin with? This is where accounts and transfers
using electronic money adds smoke & mirrors. As the bull rages on Wall
St., new money is seemingly being created independent of the Federal
Reserve. Increasing valuations of stocks can be used as collateral on
loans, and the banking system of fractional reserves is utilized to the
fullest extent as EVERYONE now has sufficient collateral to obtain a invest in further raise valuations...etc
But, when the music stops, it becomes apparent the valuations were only
gains on paper if you failed to sell at the top. Imagine the ensuing
deflation of the balloon. All of those potentially taxable gains are
gone ( the so-called "paper gains" ) and what is left at the end to pay
back the T-bill? Greenbacks. Unless the method of payment is changed,
the National debt can only get larger at a rate equal to the weighted-
average interest rate on all T-bills ever used to bring the greenbacks
into the system.
The fix? The USGovt redefines the dollar as a gram of pollution. :- )
Barges head toward all foreign t-bill debt-holders, and a nasty pile
appears on the doorsteps of Federal Reserve member banks' headquarters.
Too unsavory? Might enrage foreign debt-holders? OK, then...redefine the
dollar as equivalent to 0.001 grams of gold. The Debt could be settled
in full using approximately 5,000 tonnes of the US gold reserves. Anyone
holding gold could walk up to the USTreasury and they could then legally
issue you a REAL dollar at a rate of 1,000 for every gram, or 31,103 for
every ounce. And no future interest would be owed by the USGov for the
'minting' of this real money. The mechanics are debatable, but the
principle is what the US was founded on.

(Fri Apr 17 1998 12:20 - ID#340459)
@Silver Plate, Ref: Japan in doo-doo. Your last line in your post is the TRUTH
In 1986 the yen /Dollar was around 240 to One Dollar. The IMF/G-7 were angry with Japan of flooding the market with cheap goods due to low Yen.
Now they are crying that Yen is falling. Japanese have all their assets in US Treasuries. They sold more than $ 12 Billion on Monday to no avail and that slae proceeds went up in smoke trying to prop Yen under G-7 pressure to stimulate.
Their interest rates are lowest in the World ( less than 1% ) that will hamper any fresh Capital from flowing in any Yen Denominated asset and do not know where to go. If only they redeem their paper and buy real assets like Property, Gold, Siver, Rolls Royce's while they can before this G-7 / IMF nexus squeeze the remaining wealth that they have saved over 50 years. Wall Street is shrewder than any on Earth. By Pumping up Amex today, the DOW is supposedly back on Track.

God help us goldbugs, we are only looking for fair value for sweat of hardworking Miner's, whose hard work is being decimated by book keeping paper manipulations at Wall Street that is creating artificial booms and busts in other Nation's economies

Lan Man
(Fri Apr 17 1998 12:21 - ID#317183)
@ Suspicious RANGY down...
It is a case of taking profits - those like I that bought around 1 buck could not resist taking 46% profits in 3 weeks. Putting in a bid to get back in, probably won't be filled today though : )

Strad Master
(Fri Apr 17 1998 12:27 - ID#250297)
Ask and ye shall receive...
AURATOR, ARAGORN III, & ( especially ) NJ: Muchas gracias, amigos!!!

(Fri Apr 17 1998 12:45 - ID#410198)
A new survey based on interviews with elected officials,political appointees and high level bureaucrats finds that a majority of those government insiders do not think Americans know enough about issues to develop reasoned opinions about what should be done.

Coming next week Wall Street says the same..........BUY GOLD AND LOTS OF IT

(Fri Apr 17 1998 12:47 - ID#251268)
I'm asumeing
there is not a whole lot of spot gold being traded or are
the buyers and sellers suddenly overjoyed to do business at
this price? strange? reflected in small volume futures? and very little
price movement?hmmmmm~~~more ?s than answers,took the time in this lull
to read about Mena Ark.~~hm~~Star values his life he backed off
that one,great job of magician miss direction get them all thinking about
sex instead of treason and murder?

(Fri Apr 17 1998 12:50 - ID#212197)
@mozel, aurator: BIS Gold Control
Thank you for the clarifications. I read your posts from last night.
My conclusion: if the BIS acts on behalf of its member CBs in respect to their gold holdings, it would be fair to say that BIS "controls" approx. one billion ounces of gold. ( i.e., 31,000 tons of gold, which is approx. one quarter of ever mined gold on the globe. )

What is not clear to me is the role, the quantity and the "who owns it" of the US gold. My thinking is that this gold is owned by the Treasusy department, which means by the government, and not by the FED, which is a private institution. I think this gold has never been handed over from the Treasury to the FED. But how much is left and who has control over it? I definitely think it is not under FED control. Is it under BIS control? And how much is it?

Alberich the Dwarf

(Fri Apr 17 1998 12:55 - ID#31868)
robnoel_A - AH, ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,
the ignorant made a decision to send the dirtbags to Washington, yet the ignorant can't understand why/what they sent the dirtbags to Washington to make decisions about.

AH, ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,ha,

(Fri Apr 17 1998 12:56 - ID#317193)
The quiet is deafening!
Japan and the rest of the G-7 nations are way to quiet for my liking after such a meeting as was had in D.C. P.M.'s are to quiet also. Time to contemplate the unexpected. Back to work. Tom bbl

(Fri Apr 17 1998 12:59 - ID#316232)
Thanks for the excellent posts, providing info I must I missed. My econ professors never said so clearly.

NJ/DA.. It seems to me that in the 60's the multiplier was only 5, and is now 10. This has allowed the Fed to produce more money 'supply' with the same reserves in the banks. Since this number has never decreased, someday in the future as the next Fed chairman or Congress raises it to provide more 'money' for their monetary policy, it will approach a high enough value to indicate an insignificant amount of required reserves, and the money supply will approach infinity ( very high for non-engineers ) and the dollar will become worthless. ( hyper-inflation ) This is an under-the-table technique not observed by most citizens, but seems to be irreversible unless we have a monetary cleansing, such as a monetary reorganization/revolution/depression.

Some learned expert once announced that in the past 100 years, every time the govt has pulled back spending to balance the budget and 'pay' off some of the debt, we have a recession/depression. As long as the govt has a budget deficit which is small, the economy keeps on truckin'.

(Fri Apr 17 1998 13:02 - ID#266110)
@Sharefin your 09:59 ---- Great post regarding Market Crashes
You indicate 3 stages in the beginning of your discussion and only list two. I infer that the last paragraph is your third stage. Please indicate if that is the case.

(Fri Apr 17 1998 13:04 - ID#153102)
@There is a Free Lunch
If you take somebody else's lunch, yours is free.

Led by Pol Pot, a handful of Khymer Rouge escorted a million people into the countryside and killed them. Pol Pot died peacefully in his sleep "with a clear conscience". "I want you to know that everything I did, I did for my country," Pol Pot told his October 1997 interviewer.

Congress asked Greenspan about bankruptcy. And he told them. Technically, it is impossible. He has unlimited credit at his disposal. Every Central Banker in the Group of Ten ( except maybe the Swiss ) has the same unlimited credit available. D.A.'s analysis reflects this fact about the debt/fiat currency system that operates inside each country on earth, practically, and which the United States Government has been attempting for decades to make exist in international trade. It is based on forcing you to give them a free lunch in exchange for a piece of their printed paper. It is a criminal enterprise with the United Nations at the apex of the legal pyramid. If you think any of those in office are morally or mentally distinguishible from Pol Pot, I think you are in denial. They are all either murderers or accessories to murder before or after the fact.

The FEC has sued CBN. The IRS is auditing the political opposition. Murder at the highest levels of government is covered up. After Waco, the writing is on the wall for anybody with eyes to see. From coast to coast murder by the police goes unpunished. They have denied you legally the right to self-defense and self-preservation. What good or just motive could possibly underlie that legal determination ? It is nothing less than a rule for unconditional obedience, a demand for unconditional surrender by legal authority. Has there ever been any set of men so good as to be trusted with the absolute power implied by such a demand ? After OKC, can any maintain this set of men is even good ?

I am old and fat and full of fart, but I am not resigned and I have drawn a line in my mind. Gold is important, but what is going down in this world today is not about the substance of gold; it is about the liberty and justice of gold.

Gianni Dioro__A
(Fri Apr 17 1998 13:08 - ID#384350)
@Spud, It's not tax & spend, it's Spend & then Tax
Most people think that they send their tax money to the govt and the govt in turn spends it on various functions. This is the wrong order of events.

In reality the govt just spends money borrowed from the Fed created out of nothing. This is inflationary and like you said is insidious theft. New currency is thrown on the market and prices rise.

Taxes can be and are used to get most of this excess currency out of the system and thus has a deflationary effect on the money circulating in the economy. Note that most every country spends more than what it takes in. The US doesn't need to have taxes, it could just run deficits and experience hyper-inflation instead.

I agree with you in that inflation is another way of stealing wealth from the populace. As a goldbug though, I don't necessarily fear hyper-inflation in itself. I fear excessive taxation and socialism more.

(Fri Apr 17 1998 13:08 - ID#26793)
@JTF: Could this cadmium news turn into silver news?

(Fri Apr 17 1998 13:08 - ID#20135)
Let us see if this helps ... Comex has only $48.9 million to wipe out comex's eligible gold stocks!!
Or only 1,600 contract need to take delivery for the eligible stocks to disapear - FOREVER ( IMO ) .
1.8 million paprer ounces traded yesterday and NOT ONE ounce of actual pohysical gold changed at comex. ( It's a paper game ) . Buy and take delivery.

warehouse stocks:
-- GOLD ( Quoted in Troy Ounce )

475,158 0 0 0 0 475,158
159,146 0 0 0 0 159,146
634,304 0 0 0 0 634,304

Gold 18,000
Silver 24,000
H.G. Copper 15,000

(Fri Apr 17 1998 13:20 - ID#20135)
And this memory jogger... Amonth ago today comex eligible stocks were...
245,742 ounces. Yesterday we were at 159,146 ounces. That is a drop of over 86,000 ounces. Look at the fundamentals, don't let the paper gamemasters fool you. Real gold is scarce paper gold is plentiful - take delivery on the REAL gold bullion.

warehouse stocks:
GOLD ( Quoted in Troy Ounce )
321,832 0 0 0 321,832
156,258 89,484 0 89,484 0 245,742
478,090 89,484 0 89,484 0 567,574

L. Long
(Fri Apr 17 1998 13:26 - ID#245113)
Thanks from a Lurker
I just wanted to say thanks to all the posters. As someone who knew nothing about the world economy and gold before I started reading this site in January, I now realize that I know less than nothing. But I'm way up the learning curve thanks to you folks and your awkward questions that no one else seems to be asking. I also think that you may have saved me some $, since I was all set to start investing in DOW Mutual funds.

(Fri Apr 17 1998 13:26 - ID#225273)
Oops! PDLCF; the Gold Market
To all:
I see that PDLCF took a hit today on the release of some very bad numbers from 1997. Remember, this is old news. It does not reflect what's taking place in the company right now.
knowledge that numbers like this were coming is what led to the replacement of the previous management team. I promise things will be better next quarter. No joke.

We have a couple of predictions on gold pending here at Kitco right now. ANOTHER said yesterday that we'll have much to talk about in a cople of days. And another poster said April 20 would be a cycle bottom and things would heat up afterward.
Hopefully, next week will be beautiful. For now, I'm still favoring a pullback to $301 give or take a few dollars. But in a bull market, the surprises are to the upside.
Time will tell.

The Preacher

(Fri Apr 17 1998 13:27 - ID#285121)
Exports down 1% / Imports up 10%
How long can it be till the big wake-up ?

(Fri Apr 17 1998 13:28 - ID#20135)
If you will allow this repeat of a story on palladium ...
FWN: 141658 GMT

Closing N.Y. Metals Comments: Part 2

Platinum and palladium futures opened the day sharply
lower once again, with sources attributing this to a
continued reaction from Wednesday's news that Russia's
acting prime minister, Sergei Kiriyenko, had signed an
export decree.
But while platinum stayed lower all day, palladium
recovered enough that at one point it moved into slightly
higher territory, with a floor source citing commission
house buying and scale-up trade selling.
Another source noted trade in these metals is likely to
remain volatile, with much uncertainty remaining despite the
export decree. He pointed out that the market still doesn't
know when metals will be delivered, the quantities, or
whether deliveries will be regular or sporadic.
The future of the Russian government also remains
unclear. Kiriyenko is currently carrying the title of acting
prime minister because the lower house of the Russian
parliament, the Duma, rejected his nomination for prime
minister on the first vote last week. A second vote is
scheduled for Friday, and Communists say they intend to
oppose him again.
July platinum meets resistance at $416, $422 and $432,
said one analyst. He put support at $404.50, $398 and
June palladium finds resistance at $287 and $305.
Support is pegged at $255 and $250.


Look at Russia - The President is sick and dieing, their is NO organized government, the prime minister nomination is voted down AGAIN, and we are to believe that palladium and palatinum will soon be shipped at the old low prices. GET REAL. Russia is in BIG trouble.

(Fri Apr 17 1998 13:30 - ID#426220)
Return of the Echo from Johannesburg

There is no doubt I will be bombarded with Grammarians blasting the apparent redundancy of my title. Frankly, don't give a damn, because it is used for emphasis to continue to harp and carp the assertion that in gold's next bull market, the South African golds will far out glitter the North-American and Australian precious metals stocks -- as they so often have done in the past.

Following is yet more proof of my statement - the venerable source is the December 1994 issue of the Gold Newsletter, known internationally as procurer of reliable and timely information on gold stocks. The numbers speak loudly and clearly that South African golds have historically demonstrated more intrinsic value than their international brethren across the 'Big Pond.' Here are the data from the 1994Gold Newsletter.

R E G I O N..Market Cap/..Price/EarningsDividend

....................................Reserve Oz.RatioYield

North-America$241. 52X....0.6%

Australia....... $36743X..1.0%

South Africa...... $26.18X....42.0%

For a comparison of today's data see the report: "GLOBAL GOLD COMPARATIVE ANALYSIS" - pls notice it is necessary to close the space before the the word "-eagle" of the URL below - before posting the URL to the Internet:

(Fri Apr 17 1998 13:31 - ID#340302)
The Hashimoto's just around the bend, yes?
Oh, does appear Mr. Hashimoto is mad...and he ain't gonna take it any longer. WHOA!!!! WHOOOAAA!!!! WHHOAAAAA!!!

No, this is definitely not the time to be long treasuries and short gold.
Not at all.

On a micro level analogy, just imagine that you loaned your neighbor $10,000 a year for the past decade. You did so because, on the one hand, you were having great financial fortune and, on the other hand, your neighbor was experiencing hard times. You felt that, so long as you loaned him money, he would continue to mow his lawn and fix up his house and let your kids play with his dog whenever they want. Now, your neighbor has suddenly experienced a little financial windfall...he is feeling much better in the pocket. He has put in a brand new swimming pool and purchased three more dogs. The new dogs bark all night and annoy the hell out of you. Still, you keep your mouth shut and don't complain.

Conversely, you are not quite as flush anymore. Now, your own lawn is beginning to look shabby and the paint is peeling on your house. Yet, the weird thing is, despite the change in relative financial positions, your neighbor still expects you to maintain your $10,000 a year loan to him. Even weirder, your neighbor no longer allows your kids to play with his dogs whenever they fact, he demands that they keep away from his property. At the same time, he sends you regular complaints about the deteriorating state of your house and lawn. In those complaints, he lectures you continually about what exactly constitutes a good neighbor. So, you set up a little meeting with him and several of his "friends." When you tell him that you are experiencing some hard financial times, he tells you that it is not his problem, it's yours. Then, when you ask if he might also please keep his barking dogs quiet at night as they prevent you and your kids from getting any sleep, he tells you to go buy yourself several sets of earplugs for you and your family. Moreover, once again, he demands that, in spite of all your travails, you better maintain that 10,0000 a year to supplement his income or else! And to add insult to injury, your neighbor's "friends" also pitch in and deliver a stern lecture to you about your neighborly derelictions.

You cannot quite believe the gall of this guy and his "friends!"

You are infuriated.

You intend to take retaliatory action.

Soon. Very soon.



(Fri Apr 17 1998 13:34 - ID#20135)
Zyuganov said, "We must not participate in the final destruction of Russia."
Updating Russian Duma Rejects Premier Kirienko
in Second Vote

--Adding details throughout--

chamber of Russia's parliament, today rejected Russian
President Boris Yeltsin's candidate for premier in a second
round of voting.
The Duma voted 271-115 against Sergei Kirienko, giving
the 35-year-old technocrat even less support than he had
received in a first round of voting last week.
In the first vote, Kirienko received 143 votes of
support against today's 115, but that ballot was held in
secret as opposed to an open vote today.
Following today's vote, Yeltsin immediately renominated
Kirienko for a third round of voting by the Duma, which will
be held next week.
If Kirienko fails to gain approval a third time Yeltsin
may dissolve the Duma and call new parliamentary
The opposition-dominated Duma was summoned to vote
against Kirienko by Communist leader Gennady Zyuganov, who
addressed legislators in the morning.
Zyuganov said the parliament and the people had become
hostages to a dead Constitution and an incapable
Zyuganov said, "If we don't show courage today, our
children and grandchildren will never forgive us."
In an impassioned speech Zyuganov said, "We must not
participate in the final destruction of Russia."
The Duma's continued rejection of Kirienko is bringing
a political crisis to a head, and Yeltsin has himself to
blame for it.
Yeltsin unexpectedly sacked his loyal prime minister
Viktor Chernomyrdin and the entire Cabinet in March, and has
insisted on the appointment of Kirienko, who has little
government experience.
In a national radio address before the vote, Yeltsin
said, "We have no reason to believe this is a
The 67-year-old Russian leader says he intends to fly
to Japan later tonight on a two-day visit despite the

(Fri Apr 17 1998 13:44 - ID#251268)
Farfel ?
sounds a little one sided,hows this coming the other way,
your country is getting interest on the U.S. national debt,
h'mm,wouldn't want to rock that boat to much,thats EASY MONEY
and every one knows the borrower is the servant of the lender
so I'm sure the U.S. has somebody behind closed doors that can point this out to anybody who wants to shoot their mouth off too much?
just rambling here but if the U.S. was getting paid the interest on our debt instead of paying it~~~whew~~na Japan is loving it.

(Fri Apr 17 1998 13:45 - ID#426220)
Return of the Echo from Johannesburg - Part 2

South African Golds Results vs the XAU in the 1993 Bull Market -

Data from Gold Newsletter:

XAU appreciated about 118%

In South Africa 28 of 43 gold stocks were up more than 200%

In South Africa 6 of 43 gold stocks were up more than 500%

In South Africa 3 of 43 gold stocks were up more than 1,000%

In South Africa Western Areas was up 3,417%

In South Africa Linden was up 6,482%


(Fri Apr 17 1998 13:48 - ID#324266)
JSE All Gold Index up 1.41% to 936.

(Fri Apr 17 1998 14:00 - ID#252391)
Great analogy Farfel
Great analogy about the neighbor and his yard. Makes it very clear. Seems the action the Japanaese are taking is selling gold stocks, today. What could the Japaanese do with gold that could help their situation. They are a deficit producing country, their government prints tons of money, the only effect of the weak yen is thier red faces, it only helps their exports which they need and makes their American holdings all the more valuable. Other than to stop loaning the neighbor money which would raise US interest rates to what positive eeffect for gold?

I'm not saying tis whole presumption of your that some big event is right around the cornor that will lift gold prices isn't ture - but it's the best kept secret the BOJ has managed to keep in a long time, apparently.

(Fri Apr 17 1998 14:02 - ID#317193)
Japan- the mysterious East
Japan is and will continue to sell US treasuries and obtain US dollars ( greenbacks for you technician's a/k/a FRN ) . Assume Japan does not wish for the Yen to be strong against the dollar at the present time. What do the Japanese do with the dollars? Assume further that Japan is not buying gold but is investing in some other asset. What asset ( s ) ? Why?

What asset will bring Japan from the precipice of disaster yet not appear to endanger the almighty US dollar?

A higher Yen is good for Japan at the present time because the rest of Asia has devalued their currencies. What action by Japan keeps this relative balance in the currencies?

What action by Japan will strengthen it's banks and reduce the debt of the government?

No, I don't have the answers but I bet BIS does. Tom

(Fri Apr 17 1998 14:04 - ID#212197)
@NJ, DA, Aragorn: Creation of Money
Thank you very much for re-posting these excellent explanations for creation of money by the FED Banks
1 ) through Commercial banks ( based on the reserve deposit percentage )
2 ) through Treasury bills and bonds
3 ) through lending reserves to the commercial banks.

Now , please let me ask a few further questions.
The private bankers who have the monopolistic right to create money out of thin air ( when they purchase T-bills or when they lend reserve notes to commercial banks ) , they don't do this out of altruism. Even it costs them only thin air, they wouldn't do it.

Therefore, I fell I understand the whole picture of money creation only, when I understand how this created money ends up in the hands of these private bankers. Who they are we can discuss later. Let's first understand why they where so wild to get this monopoly right.

Example: the federal debt of $5.5 trillion. This debt got originated by the Treasury giving T-notes to the FED and the FED paying in money ( created out of thin air ) . Now the Treasury has the dollars and we think we know what they do with it, and the FED bank has the asset T-Notes.
The FED can hold on to these assets ( what it doesn't like to do ) or the FED can sell this asset for honestly earned money from real people ( what it likes to do ) . So, what happens, after the FED sold these T-bills?
Where do these proceeds end up?
How do the international bankers get a hold of it?
I'm only sure it is not dumped into a black hole.

Alberich the Dwarf

(Fri Apr 17 1998 14:12 - ID#153102)
@Face Facts @Nazi Gold
Printed paper legal tender is the robbery; inflation and deflation are theft from those who have already been robbed. When the victim resists, the robber becomes a murderer.

"ALBERICH__A ( @mozel, aurator: BIS Gold Control ) ID#212197:
Copyright  1998 ALBERICH__A/Kitco Inc. All rights reserved
Thank you for the clarifications. I read your posts from last night.
My conclusion: if the BIS acts on behalf of its member CBs in respect to
their gold holdings, it would be fair to say that BIS "controls" approx.
one billion ounces of gold. ( i.e., 31,000 tons of gold, which is
approx. one quarter of ever mined gold on the globe. )
What is not clear to me is the role, the quantity and the "who owns it"
of the US gold. My thinking is that this gold is owned by the Treasusy
department, which means by the government, and not by the FED, which is
a private institution. I think this gold has never been handed over from
the Treasury to the FED. But how much is left and who has control over
it? I definitely think it is not under FED control. Is it under BIS
control? And how much is it?
Alberich the Dwarf"

FDR ordered that gold be turned in to Federal Reserve Banks. Then, Congress swapped the gold in the Federal Reserve for Treasury Notes. I think if you boil it all down, you will find that the United States Govenment reneged on the gold loans it had made from various bankers from 1860 onward just as in 1971 it reneged on its promise to redeem the greenback for gold in international trade. The purpose of the War on Gold is to legalize these criminal breakings of covenants.

I think the so called Nazi Gold is key to understanding. From the period of 1939 to 1945 BIS engaged in gold transfers, etc. with the Reichsbank. They have released an audited note on these transactions at the website. I think Reichsbank gold came into the possession of the United States after 1945 and was taken to the United States, but that in international law, it belonged to BIS or at least BIS was Trustee and Agent for it. BIS established its claim, then BIS loaned it to the United States at some point in the 1970's to defend the greenback. Now through the Nazi Gold suits, the United States is making a collateral legal attack on the title to the gold and indirectly on BIS's Trustee and agency control of it. The Swiss are implicated in the Nazi Gold, too. This is all just a continuation of the War on Gold policy. I'm sure legally it is more complicated, but practically I think this outline is correct. Whatever it was that Sutton stated that BIS or the Swiss was able to use to restrain the United States Government in its War on Gold in the 1970's is the object of this Nazi Gold legal and propaganda attack.

(Fri Apr 17 1998 14:24 - ID#57232)
Cadmium Ban in EU by 2008 -- probably not a boon to silver
Donald: Cadmium is an essential component of the Nicad Battery, the current rechargeable substitute for ordinary nonrechargeable dry cells.

As I recall, there are other rechargeable battery technologies that might substitute right now:

1 ) Nickel - iron battery commonly used in portable computers

2 ) Lead acid -- fewer recharges than nickel-iron

Other batteries include:

Silver-zinc ( I think ) very expensive but high capacity non rechargeable

Aluminum - air ( recyclable ) good potential for long range electric car.

Fuel cell ( technically not a battery ) - very expensive, but becoming practical for electric vehicles - reguires highly purified fuel. Hydrogen may be the best energy choice environmentally -- from water or natural gas.

Sodium/alumina -- High capacity expensive and very hot ( impractical for home/car use ) .

Lithium/X ( unknown ) -- expensive, high capacity, not rechargeable

I think the bottom line is that silver use in batteries is not likely to be a high demand item in the small battery or electric vehicle markets, unless there is a major cost breakthrough in the technology.

My guess is that nickel-iron or lead acid batteries will substitute for the nicads in the small home rechargeable market, and the hydrogen fuel cell technology will be the first practical large scale, low pollution automotive application. Just today there were reports of significant process cost reductions in the electrolyis of water to hydrogen and oxygen. Combustion to H2O + power is as low-pollution as one could ever imagine. No CO2 pollution, even.

Hydrogen is not that dangerous when compared to gasoline - now that there are low-pressure hydride fuel tanks available. Not that I would want to sit by one engulfed in flames ---- but there should not be a source of flames if there was an elcetronic safety shutoff at the tank.

(Fri Apr 17 1998 14:24 - ID#266110)
@vronsky your 13:30 & 13:45 -- Your proof about SA superiority
You've convinced me. Now, will you post some recommended SA Au stocks?

Gianni Dioro__A
(Fri Apr 17 1998 14:29 - ID#384350)
Farfel, Turning Japanese
Farfel, I liked your analogy. May I add the following:

Japan doesn't actually hold them Treasuries. The US Fed holds them. Has anyone else here had problems when trying to withdraw a substantial sum from a bank/brokerage when it's supposedly on demand. They give you the run around, try to convince you to keep your money where it is, and when you refuse they say "We don't keep that kind of money here", or "It'll take a couple of days before we can get a transfer out."

I would think that the US Fed is giving Japan the run around. I liken Japan as a bar owner, and the US as his biggest drunk who drinks on credit.

I'll gladly pay you tomorrow for a cheeseburger today.

(Fri Apr 17 1998 14:30 - ID#252391)
No Japanese Buying of Gold Today
Without hesitation I can say the Japanese have not launched an attack on the United States of America's currnecy in retaliation agianst the Japan bashing being conducted by the US. I can, without hesitation, say the effect on the gold market of the Japanese govenments action to steady their currency and regain respectability is nil. In fact the effect that they might do something to steady their currency is Gold down 40 cents.

Farfel, lets hope they don't push this thing.......Again, why do the Japanese want a stronger currency and why will anything they might do with gold promote a stronger currency.

(Fri Apr 17 1998 14:32 - ID#200235)
Vronsky & Locke&Lode SA GOLD FUNDS
I appreciate very much your site golden eagle. I would like your opinion on US Investors US Gold Fund. It invests only in SA Golds and was down 94% for the last year so downside seems to be limited. Your wonderful site and frequent postings here have convinced me as well that the real upside is in SA. Keep up the good work and thanks in advance.

(Fri Apr 17 1998 14:34 - ID#251166)
@ Gold
Down most of the day, nice little 50 uptick at the end to close unchanged. Nice finish. Go Gold!

(Fri Apr 17 1998 14:34 - ID#238295)
DA: Aren't you confirming the old Ed Hyman thesis that financial crises are good for the markets because they force the Fed to ease? But this game can only perist as long as the bond market continues to assume that inflation will remain dormant despite the tremendous purchasing power being created today. Once the bond market starts to react to the inevitable resurgence of inflation, the game will be over or almost so.

How long do you think long bond yields can remain under 6% as the money supply explodes and asset price inflation accelerates?

Strad Master
(Fri Apr 17 1998 14:35 - ID#250297)
Cause for celebration!!!
ALL: I would like to interrupt this discussion for a moment to rejoice in the ( now confirmed ) death of Pol Pot - agrueabley one of the most evil monsters to ever inhabit a human form. His appalling reign of terror, atrocities, murder, torture, slaughter, and starvation caused the deaths of between one and two million innocent Cambodians, roughly one quarter to a third of all the people in his country. Many were killed because they wore glasses or spoke a foreign language - both signs of having been corrupted by foreign influence. Sadly, this despicable piece of human vermin escaped all justice and departed this world quietly in his sleep, without ever experiencing a scintilla of the pain he so richly deserved. I can only pray that the time he spends in the lower depths of Hell will be agonizing in the extreme. The world is a better place now that he has beeen removed from it.

(Fri Apr 17 1998 14:36 - ID#339274)
triple bottom XAU
FWIW.We got a triple bottom on the hourly chart
ABX bounced off its 21 1/16 support.
This is in close alignment to the April 20 cyclical
turning point.XAU 83.50 counts as a stop.

(Fri Apr 17 1998 14:38 - ID#266110)
@AUH2O -- RE: your handle... should we call you BARRY?
And are you running for President?

(Fri Apr 17 1998 14:41 - ID#251166)
@ Strad Master re. death of Pol Pot
Without love there is no justice. You can bet that guy's at the beginning of one long and agonizing eternity. Blessed be those martyred by the evil one.

(Fri Apr 17 1998 14:44 - ID#20167)
Someone was seeking info about the murder of Miss Mahoney, a
former white house intern who was killed in a Starbucks
restaurant in Wash, D.c.
See the article by reporter Gary Lane titled: "dying to tell
etc" @

For a more complete body count list see

(Fri Apr 17 1998 14:44 - ID#153102)
I think you have found the head of the nail. Let's suppose you loan the Godfather Yakuzi a million. What do you do when he closes the window ? The USG has already stiffed the bankers for their gold and stiffed the world on redemption of greenbacks for gold in trade. Will people with that background shrink from withholding redemption of paper for paper ? The Japanese have Yakuzi at home and Yakuzi abroad.

(Fri Apr 17 1998 14:50 - ID#266110)
@AYORK your 14:44 --- Your 2nd post will not initiate
( Note says..... not found on this server ) . Can you check and repost the site?

Aragorn III
(Fri Apr 17 1998 14:50 - ID#212323)
ALBERICH the attempt at answers to your ??'s
You said, " Now the Treasury has the dollars and we think we know what they do with
it, and the FED bank has the asset T-Notes.
The FED can hold on to these assets ( what it doesn't like to do ) or
the FED can sell this asset for honestly earned money from real people (
what it likes to do ) . So, what happens, after the FED sold these
Where do these proceeds end up?
How do the international bankers get a hold of it?
I'm only sure it is not dumped into a black hole. "

I say, "The black hole indeed gets the paper...", but not the INTEREST.
The FED has several tools in their bag of tricks to 'regulate' the economy; the prime lending rate is one, the buying and selling of Treasury Notes is another. To answer your question about what happens to the proceeds when the FED sells T-notes, first remember this--the FED obtained the T-Notes in the first place by buying them from the USGovt in exchange for greenbacks ( from thin air ) to pump up the nation's money supply. When the FED SELLS these T-Notes, they are essentially recalling their own greenbacks--usually in an effort to reduce the money in circulation. The majority of the greenbacks are essentially dropped into a black hole because they are now out of the system. The portion that is reckoned as the FED's proceeds is the difference between the price they paid to the Treasury vs. the price for which they sold them to you, to me, or to Japan...

Spud Master
(Fri Apr 17 1998 14:50 - ID#273112)
@Mozel and the nascent totalitarian America....
Yes, Mozel, very few want to admit it here ... here in the land of the full belly & deep denial ... that America moves inexorably, day by day, freedom lost by freedom lost into a totalitarian police state.

The notion of a "hate crime" is the most frightening of all.

In my book, there are just crimes. Period. What you were thinking when you commited the crime doesn't matter. You could have been thinking beatific, peaceful thoughts as you drove the tire iron into your neighbor's skull: it doesn't matter - it's the act matters.

But now the barn door is open. Don't think that the definition of a "hate crime" will stop where it is now. Perhaps those who object to the lifestyle of gays and lesbians will be accused of "hate crime" at some point in the future.

Perhaps objecting to "affirmative action" as being racist and discriminatory, will be declared a "hate crime" soon.

Do you get the picture? They are not outlawing criminal acts: they ARE DEFINING CRIMINAL THOUGHT!

Therefore, a "hate crime" is ***really*** a THOUGHT CRIME.

Political Correctness is the more general version of "hate crime".

Now, you may be a bloody neo-Nazi racist in your thinking, but as long as you behave normally, it's really none of my business.

In fact, IT'S YOUR CONSTITUTIONAL RIGHT to think/believe however you wish. So, you want to be a Hispanic racist - go ahead. None of my business.

Expect to see asset confiscation somehow linked with "hate crime" in the near future: when you ( the US FedGov ) must keep redistributing wealth in order to maintain your power, and you have exhausted available tax sources ( Income Tax, Cigarette Tax, Luxury Tax ad nauseum ) then one thing is left: you create a criminal class be edict & confiscate their property and wealth.

No doubt, when the FedGov gets in a crunch in the near future & wants the GoldBug's gold - they'll declare us all "dangerous antisocials", "incipient terrorists" and "right-wing peach-coloured supremists".

The Nazis could take a few lessons from the current US FedGov - you don't just round people up and ship them off to a concentration camp - no you employ public relations campaigns, paid-off press corps, Hollywood star mouthpieces to disseminate your poisoned ideology. You pretend to the rule of law, while perverting it and subverting quitely. You "legally" take & reduce those who oppose you, making an example of them to anyone else who would oppose your bestial path to totalitarian power. You keep it up for 30, 40, 50 years, nibble by nibble, slowly, slowly, degradation by degradation, always more goverment control, until...

Welcome to Hell.

According to Washinton D.C. - Thomas Jefferson, Thomas Paine, Benjamin Franklin, George Washington, George Adams - these would all be considered right-wing terrorists today. Our founding fathers would take one look at the Washington D.C. political-class and ask us how we had managed to come full circle in 200 years!

Spud, reject the US Dollar! Buy gold!

(Fri Apr 17 1998 14:53 - ID#266105)
@hate crimes

What about the very nasty things routinely bandied
about concerning wealthy people. Do they have feelings

Gianni Dioro__A
(Fri Apr 17 1998 14:55 - ID#384350)
Alberich the dwarf, The Fed
The Fed is a privately held corporation with shares. It has Licence ( not the Right ) to counterfeit money. These central bankers want their respective govts to go into debt so that these govts are forced to make interest payments to the central bankers who own Treasuries ( for which they simply traded funny money created out of nothing ) . This is why there have been World Wars, minor wars, and generous social spending, as well as pork barrel spending. They want govts in debt so that they can collect interest.

These bankers end up buying up the media, industry and politicians with the profits they make from their unconstitutional banking practices.

I don't know how many people Pol Pot killed, but I doubt it was more than were killed in the Wars of Independence, Civil Wars, World Wars, etc.

(Fri Apr 17 1998 14:57 - ID#153102)
"Therefore, I feel I understand the whole picture of money creation only,
when I understand how this created money ends up in the hands of these
private bankers. Who they are we can discuss later. Let's first
understand why they where so wild to get this monopoly right."

They were not. The Federal Reserve System was forced on banks. The USG has the monopoly power to "coin money". It created the Federal Reserve so it could defer and dodge its obligation to pay back gold loans. Then, it bankrupted and reneged on the gold loans. It gave the banks "licenses" and "deposit insurance" instead of gold. The USG under FDR wiped out the capitalists in America just as Lenin wiped them out in Russia. FDR just met no armed resistance. That's the whole difference.

Strad Master
(Fri Apr 17 1998 14:58 - ID#250297)
Interesting stuff...
LOCK&LODE: AYork's 14.44 link worked fine from my computer. Try it again.

Aragorn III
(Fri Apr 17 1998 15:00 - ID#212323)
Incredible exchanges over the past 24 hrs. on Kitco...
The howling from this pack of wolves has rarely been more pleasing to the ear. Well done!

(Fri Apr 17 1998 15:03 - ID#413195)
in sack-o-tomatoes
Strad: Don't know how I feel about Pol Pot's death, actually. Certainly nothing humans could ever do to him would be sufficient punishment for his stomach-turning crimes. Still, I wish he would have lived long enough to have been ripped to shreds by a angry Phnom Phen crowd. He was THE most monstrous evil spirit ever turned loose on humanity in my opinion, and the body count would have far exceeded the total for Hitler, Stalin, and Mao combined had he come to power in a more populous country.

(Fri Apr 17 1998 15:03 - ID#426220)

Ref: "Lock&Lode ( @vronsky your 13:30 & 13:45 -- Your proof about SA superiority ) "

PERSONALLY, I find the Polarbear's and John Disney's advise well worth the read of their Report, "RANDGOLD EXPLORATION." - pls notice it is necessary to close the space before the the word "-eagle" of the URL below - before posting the URL to the

Following is also interesting:

Date: Fri Apr 17 1998 12:21
Lan Man ( @ Suspicious RANGY down... ) ID#317183:
It is a case of taking profits - those like I that bought around 1 buck could not resist
taking 46% profits in 3 weeks. Putting in a bid to get back in, probably won't be
filled today though : )

46% !! -- HEY, THAT AIN'T HAY!

(Fri Apr 17 1998 15:10 - ID#227238)
Mozel: It's my understanding that the fed system was forced on non money center banks and that large NY banks have always been in favor of a central banking system. At least as far back as the Jackson administration. Please correct me if my understanding is in error.

(Fri Apr 17 1998 15:12 - ID#7568)
Old Gold & WSF:

For some odd reason, central bankers are loathe to remove the punchbowl when confronted with asset price inflation, as opposed to the garden variety of wage and commodity price inflation. Both are symptomatic of the same phenomenon, namely too rapid credit expansion.

I think long and hard about how this game is going to end, because the right answer is worth a lot of money, and the wrong one could cost a lot. One of the reasons I am so drawn to the stuff arena, is that the risk in being wrong is much lower. I have recently converted a sizeable portion of my net worth into Central American hardwood forests. It turns out that trees don't cost very much south of the border, and that if you cut them down and make useful things out of them they are worth quite a good deal to other people in the world. The beauty of it all is that they grow at an astounding pace down there. So depletion is not really a problem.

One of the ways that this period can end, which has never really been discussed here at Kitco, is the large scale monetization of government debt. In this version of the end game, bond prices do not go down in nominal terms because the government simply prints money to buy them back. As long as this policy is followed by all major governments, there is no relative currency debacle, because all currencies are being devalued simultaneously. In this version, the stock market does not go down either. What does happen is that the price of a loaf of bread goes up a whole lot, as does the price of a house, a car, a movie ticket or heaven forbid, gold.

Equilibrium will be restored between the value of financial assets and the value of good and services. Whether the price of the financial assets declines or the price of good and services rises to meet them is a constant debate. I vote for the latter, because it is the path of least apparent pain to those that will ultimately decide the question, namely government.

(Fri Apr 17 1998 15:13 - ID#153102)
There's nothing nascent about it. It is here, has been here. We have just been consenting to lies from fear. Believe it or not, Freedom of Thought is not guaranteed in the Bill of Rights. Believe it or not, this government is on a one way street. It demands nothing less than unconditional obedience and unconditional surrender. I wish all traders well, but lest they forget, there ain't enough gold on the planet to buy safety from the Federal Mafia. Ask Milken.

(Fri Apr 17 1998 15:18 - ID#7568)

I don't really know what kind of numbers would have to come out of Japan before all parties concerned could say that they were out of the woods. Whatever they are, they are probably a long way off in time. I have read cogent economic arguments that basically state that the decline in the labor force plus the growth in productivety estimated for Japan over the next decade or more, indicate that economic potential is really not far from zero.

On the other hand, I don't think things are quite as bad in the Land of the Rising Sun as some would have us believe. While it is true that the financial economy is in tatters, the manufacturing economy is doing quite well. Growth in their money supply, which is a proxy for bank credit, is showing some signs of life. If they were headed for the sinkhole, this number would be contracting.

The process in Japan has been going on for around 7 years. A lot of the rubble has already been cleared and most of the damage is out in the open. Real estate prices are begining to stabilize, and even increase ever so slightly in some sectors. If I were forced to own an equity index for the next five years, I'd rather own the Nikkei than the Dow.

(Fri Apr 17 1998 15:18 - ID#270236)
To answer your question: if the Japanese sell dollars for gold it
would tend to depress the dollar without shrinking the Japanese
money supply. The Japanese may want to strengthen the yen because:
( 1 ) a weak yen policy has not stimulated economic recovery and ( 2 )
the weak yen policy may be actually weakening the Japanese economy
by causing capital to flee Japan for sterile investment in U.S.

(Fri Apr 17 1998 15:23 - ID#7568)

In the never ending quest to garner more tickets to the dance, I am off for awhile to drum up some business on the other side of the pond. If anyone of you are going to be at the MAR conference in Cannes, drop me a line at

In the mean time, don't forget to hug your kids.

Strad Master
(Fri Apr 17 1998 15:28 - ID#250297)
RON: What do you mean you "don't know how you feel about Pol Pot's death"? After you say that in your post, you then proceed to define him and his atrocities in no uncertain terms. For someone with no opinion, you certainly seem to have your morality working in fine running order!!

(Fri Apr 17 1998 15:30 - ID#20167)
@Lock & Lode, mysterious deaths
The second article has to be accessed by the following route:

then scroll down to bottom, click on the word "personalities"
then on next page, click on "Geoff Metcalf"
then on next page, scroll down to bottom to find 2 different articles beginning with "suspicious deaths"

(Fri Apr 17 1998 15:32 - ID#200235)
Lock&lode, My name is
Herb but Sen Goldwate was one of my heros. A real conservative and a good republican too. Sorry it took so long to respond but I was away from computer for a while. Have a good day and if you develop any possible SA Gold stocks or SA GOLD Mutuals , please pass them along to me.

Thanks in advance

Gianni Dioro__A
(Fri Apr 17 1998 15:35 - ID#384350)
Spud, Confiscation based on intent
In the 1996 Health Insurance Portability & Accountability Act, govt regulators were given the authority to freeze doctors' assets if they merely SUSPECT an INTENTION to commit a healthcare offense. In other words govt jack-booted thugs can read doctors' minds and determine guilt or innocence & grab everything they have.

A hypothetical situation: Let's say that it costs $40K a year to treat someone with AIDS. Let's also say that some shrub that grows amply in Canada can cure the disease outright for next to nothing. Now big pharmaceutical companies wouldn't want people to know about this shrub, so they have their lackies make the posession or distribution of this shrub illegal. In this totally hypothetical situation, the govt could pose as a poor, sick dying man and ask the doctor for this shrub. The doctor agrees to help and is then arrested on Intent and has everything he posesses confiscated. It only takes a couple of cases to make an example.

Amerika, Love it or Leave it.

(Fri Apr 17 1998 15:42 - ID#153102)
There was a struggle between the States and the Federal that was focused in banking. Hamilton and Marshall ( a stockholder in it ) got the Bank of the United States chartered. The federal government then used its legal power to give this bank advantages over State Banks. Jackson ended that. But after the States were conquered and occupied and reduced submission to martial law after 1865, the way was clear.

After 1865, the banks had a borrower that was too large to fail. The federal government became a partner. Real estate developers often get banks in the same position. The banks were in a position where they could not refuse Congressional demands for loans. They were unable to deal with the consequences of Treasury borrowing in the credit market. Hence, the series of panics and the myth of the business cycle. Hence, the Federal Reserve System. The money center banks favored the Federal Reserve System as you say. But, what choice did they have ? They had no more choice then than they did later when FDR declared a bank holiday. They had no more choice than the railroads had when Wilson nationalized them in WWI under War Socialism.

(Fri Apr 17 1998 15:44 - ID#238295)
DA; My take is that the adjustment will involve both a decline ( 30-50% ) in financial assets and considerable price inflation. Sort of like the 1970s. If goods price inflation bears the entire burden, the cost to those without large portfolios will be enough two trigger a massive political upheaval.

Never in history has a bubble like this one been sustained. A 1929-32 type debacle is indeed improbable, but a 1970s rerun seems like a good bet.

(Fri Apr 17 1998 15:47 - ID#20167)
@Lock&Lode, mysterious deaths, 2nd attempt
Try this route

click on "Go to ksfo home page"
scroll down to bottom, click on the word "personalities"
scroll to bottom click on "Geoff Metcalf"
scroll to bottom, there are 2 articles beginning with
"suspicious deaths"

(Fri Apr 17 1998 15:49 - ID#426220)

ref: AUH20 ( Vronsky & Locke&Lode SA GOLD FUNDS )

Being down 94% you may rest assured all the most worthless stuff is gone. However, I am in doubt whether it will be the best South African gold fund in the next bull runn.

The following is what they have now. It has between 30-25% of the portfolio in SA shares - I was surprised they could not be more exact. Their top largest holdings have a sprinkling of NON-SA gold shares, principally from Australia and N/A - which I found dissapointing. Were I to invest in a SA mutual fund based upon my studies, I would look for one which has a much higher per cent of SA stocks in its portfolio.

Nonetheless, it is intersting historic data to know that this particular gold fund turned in a very respectable TOTAL RETURN of UP 124% in the 1993 gold bull market.

(Fri Apr 17 1998 15:50 - ID#344308)

put this in your pipe and smoke it...

price of gold from the 1700's...

somebody needs to put into chart form..

gold is definitely in a long term up-trend....

(Fri Apr 17 1998 15:51 - ID#426220)
It should read "...The following is what they have now. It has
between 30-35%...."

(Fri Apr 17 1998 15:53 - ID#411149)
best SA golds
Lock & Lode- The best SA golds? Of course go to golden-eagle and read
Polarbear's article and the others posted there. My experience in 1978
I chose 3 that were recommended by a broker that specializes in SA golds
they were up 140 times over the next few years. In 1993 I picked
Western Areas and you see vronsky's results there. Now today I have
picked Durban Deep for 75% and Harmony for 25% of that part of my
port. dedicated to the SA golds. Gold Newsletter did a spread in the Nov.
issue on DD and continues to follow it, described DD as possibly THE best
gold share in the world for price appreciation IF gold goes UP.
You ought to get your hands on a subscription if you really are interested in MAKIN MONEY!
Now I have run the border on advertising to help YOU! I done made my
decision. GOOD LUCK!!

Tally Ho

PS - goin to the Monterey to play.

(Fri Apr 17 1998 15:54 - ID#402148)
Any thoughts on the latest on RYO?

Gianni Dioro__A
(Fri Apr 17 1998 15:55 - ID#384350)
Dow Chart
I'm no expert chartist, but the Dow chart looks like a bunch of 2 by 4's nailed together, one on top of the other, with a fat person standing on the top.

(Fri Apr 17 1998 15:56 - ID#218386)
Opinions Please?
I watched GEO:TSE float all day in the 2.30-2.35 range and trade only 27,000 shares. During the last hour a buyer from ScotiaMcleod has snapped up 350,000 shares. Does this portend well or ill for the stock?

(Fri Apr 17 1998 15:58 - ID#269409)
@Strad 14:35, Ron, 15:03

(Fri Apr 17 1998 16:01 - ID#20167)
One of the best books written about the Federal Reserve is
"The Creature from Jekyll Island"
by G. Edward Griffin
This is a must read for anyone trying to understand the
world monetary systems.

(Fri Apr 17 1998 16:05 - ID#324266)
US Gold Shares Fund USERX
Let me add to Vronsky's apt comments that this fund has a large holding of the Pioneer Group Inc. ( PIOG ) , which is involved, I think, in Russian silver developments. I will post more about this company ASAP as they are located here in Boston. US Gold Shares management is experiencd and I hope that they increase the RSA shares soon.

(Fri Apr 17 1998 16:05 - ID#261269)
IF YOU ARE still interested in SA Gold Shares, and FWIW...i AM 50% in Drooy ( DD ) and 50% in Rangy ... in at today's gold..

Vronsky convinced me too!!

Go Gold

(Fri Apr 17 1998 16:06 - ID#266110)
@Gianni your 08:54 -- Taxes & Govt Spending-- adding to your ideas
One could almost draw the conclusion that taxing at higher levels is actually good because it "dampens" out inflation. To commit one sin with another can never be good. And while the statistics may show that this keeps hyperinflation in check, maybe it's better to have such hyperinflation in lower taxed countries because it really exposes the purveyors of indirect taxation for what they really are. Hyperinflation is just a really high tax in an isolated sector while inflation and higher taxes are a lower level / composite impact that parallels the single impact.

When hyperinflation is high, then people tend to respond actively. CGs don't like that ( which is good ) . But if the pain is spread over two fronts, then the people are more likely to passively accept the impact - which is what CGs like and the US has adopted. Then we have a situation of the frog being boiled alive.

Maybe its the way you say it..."Govt spending is generally inflationary whereas taxes bring back those excess dollars..." WOW! I don't know about the rest of the Kitcoites out there, but I never thought of my tax dollars as being "excess". And even if there is a so-called "deflationary" impact, Govt spending is inflationary and so is taxation inflationary to the public. The public has less money to spend when taxes are taken which is clearly inflationary to them.

To cut to the heart of the matter.
1. GOVT is the author of inflation.
2. Taxes are also inflationary to the public.
3. When deflation hits, those who have money ( or true money ) have beaucoup purchasing power. It is the debtors who get squeezed ( and rightly so ) .
4. Deflation is not necessarily so bad. Certainly no worse than inflation. IMHO.

If taxes are "deflationary" to Govt, then I'd like to see a different term or phrase used. Such as, "taxes removes the debt created by government's inflation of the currency". And so that all understand, that the public pays the debt of government excesses ( inflation and spending ) through taxes. Put in that context, I don't see how anyone can consttrue taxes as being "deflationary". IMHO

Maybe it was a poor choice of words on your part and there was a concept that you wanted to forward to the group. I would prefer that taxation and its effect not be used interchangably with deflation.

I will also take exception with your assertion that CGs can always circumvent the impact of inflation with more inflation. That's like saying, you can put out a fire by putting more gasoline on it.

As I reflected in a previous post back in March. There are two schools of thought on the subject.
1. Monetarist - such as Milton Friedman
2. Austrian School - Ludwig von Mises

In the Monetarist thought, when deflation rears its ugly head, then all you have to do is to print more money. The assumption is that as a CG issues more paper then paper is used in the economy. But this doesn't necessarily work. In order to get the paper out there, you need someone who is willing to either borrow ( and pay back with interest ) or purchase ( who you pay back with interest ) the note ( s ) being issued. WHAT IF NO ONE WANTS THE PAPER? Obviously, this has happened in the past and will again.

In the Austrian School, they argue that you must pay directly for your sins. If there is inflation, then there must be deflation to counteract the inflationary excesses. There is a reverse process at work. Similar to putting water on a fire. Yes the fire cools down, and the activity is not as robust as before. Similarly, the economy cools down, but you don't loose the entire "house" ( economy ) .

An economy backed by gold experiences natural ebbs and flows of inflation and deflation ( but to a small degree ) . In a totally paper economy, the inflation runs on, and on, and on... As it keeps increasing, the prospects of any deflation is viewed ( by CGs and greedy bankers ) as being intolerable. Well, if deflation is intolerable, THEN WHY IS INFLATION TOLERABLE????? Let's all use some common sense.

But if you have tangible AU and IF YOU ARE OUT OF DEBT, then the prospects for deflation are no where near the same concern for you. Now, I will admit that they are for CGs, but that's good because they've taken our money long enough as a tax through inflationary default. This is important stuff.

(Fri Apr 17 1998 16:06 - ID#240120)
A message to all readers (lurkers) who DONT own any gold
This gold discussion forum hosted very kindly and thoroughly professionally by Kitco Inc. is the most popular and well maintained discussion forum on the internet. YES, ON THE INTERNET. This means that what you are looking at right now is the most popular discussion forum of its kind in the world. YES, THE WORLD. If you are like me ( I love this site ) you will probably admit that finding this web address was nothing short of a miracle. The quality of information and exuberance of ideas for all to read FOR FREE is totally unique and virtually unimaginable in todays paper-grabbing society. Yet right here, right now we have people helping and informing others not because they have to but because they want to. This is because deep down they all know that if they can encourage just one person to buy just one ounce of gold then they will have helped that same person take the most important financial decision of their lives. Gold afterall is the only currency that gives everyone an equal chance and what the world needs right now is for everyone to have an equal chance. When it comes to currency gold is truth and we all know that the truth will always reveal itself.

Thank you very much for listening.

G o G o l d and have a good weekend.

(Fri Apr 17 1998 16:07 - ID#330175)
'Heavy Sh!t'.....................................................* Go Gold*
Abraham Lincoln was elected to Congress in 1846.
John F. Kennedy was elected to Congress in 1946.
Abraham Lincoln was elected President in 1860.
John F. Kennedy was elected President in 1960.
The names Lincoln and Kennedy each contain seven letters.
Both were particularly concerned with civil rights.
Both wives lost their children while living in the White House.
Both Presidents were shot on a Friday.
Both were shot in the head.
Here is an interesting one...
Lincoln's secretary was named Kennedy.
Kennedy's secretary was named Lincoln.
Both were assassinated by Southerners.
Both were succeeded by Southerners.
Both successors were named Johnson.
Andrew Johnson, who succeeded Lincoln, was born in 1808.
Lyndon Johnson, who succeeded Kennedy, was born in 1908.
John Wilkes Booth, who assassinated Lincoln was born in 1839.
Lee Harvey Oswald, who assassinated Kennedy was born in 1939.
Both assassins were known by their three names.
Both names are made of fifteen letters.
Booth ran from the theater and was caught in a warehouse.
Oswald ran from a warehouse and was caught in a theater.
Booth and Oswald were assassinated before their trials.
And last but not least,
A week before Lincoln was shot he was in Monroe, Maryland.
A week before Kennedy was shot he was in Marilyn Monroe.
Only the individual sender is responsible for the content of this
message, and the message does not necessarily reflect the position
or policy of the National Education Association or its affiliates.

(Fri Apr 17 1998 16:08 - ID#200235)
Vronsky @ US GOLD FUND
Thank you for that excellent analysis on US gold fund. At one time their percentage of SA golds was much higher. I was invested with them in 93 thru present however I forgot to take my profits when they were available.

I will continue to look for a strictly SA Gold fund. I agree with Lock&Lode that it is the very best place to be at this time.

Thanks again for your help and keep up the good work

(Fri Apr 17 1998 16:15 - ID#413195)
in sack-o-tomatoes
Strad: Thanks for using the smiley face. At first I thought you were upset, but now recognize you were just teasing. You're a gentleman, Strad. And I've always known you as such. Nevertheless, lest others misunderstood me, I AM glad old Pol Pot is dead ( though a little uncomfortable saying it, as I was raised not to say such things about the dead, no matter how mean they were in this life ) . . . In fact, I wish that the SOB had never been born, or had been born into a tub of flaming napalm, that was falling off a cliff, onto an electrified fence that, in turn, was lying across some railroad tracks, down which was barrelling an out-of-control, 1000-car freight train, fully loaded with nukes, TNT, nitroglycerin, and big tanker cars full of anthrax and ebola viruses and lots of good old-fashioned liberal intentions. Whew! . . . Glad I got that off my chest.

Funny how mankind has suffered some of history's most heinous tyrants this century, and still, the gun-control kookaboos believe that the 2nd Amendment is a big embarassment.

. . . AWAY!!! ( is that plagarism? ) . . . to buy another assault weapon for the day Pol Pot is reincarnated in Amerika.

( What does this have to do with gold? I'm still long gold and long guns, and talking up both for much the same reasons. )

(Fri Apr 17 1998 16:16 - ID#176200)
I surely agree with you 100% on your last several posts! I have
experienced first hand the scenario at my brokerage ( ex ) firm. I have also seen it at my bank and have been quized by the teller as to what
I plan on doing with the money etc. I have since withdrawn most of
my capital from that bank also. I am fed up with living under the shadow
of this repressive gov and all their reporting laws.
But alas, I am such a small minority that feel this way that I am
afraid to speak out about it. I just keep my mouth shut, buy more ammo
and lay REAL LOW! Thanks for the posts.

not speaking for my employer

(Fri Apr 17 1998 16:16 - ID#426220)

The argument goes back and forth of whether gold IS OR IS NOT AN INFLATION HEDGE. Well here's another proof that it is. Cherokee just gave us the data to prove that it indeed does - see his website:

A big gold price hike occurred between 1932 and 1933 - rising 69%
from $20.67 to $35/ounce. During the succeeding 66 years ( n=66 ) gold
HAS appreciated at an ANNUAL compound rate 4.2% - using today's price of about $310. HEY, 4.2% compounded yearly is greater than the average inflation rate over that long period.

To me that makes a pretttttty convincing argument for extremely wealthy individuals who wish to conserve the buying power of their accumulated wealth. "Bettcha" your bottom dollar that's why the ROTHSCHILDs
have always been so close to the shiny yellow... it figures!

Neither wars, nor national calamities, nor the bubmling of politicians, nor the inundation of paper money creation by Central Bank lackies can dilute the long-term purchasing power of the noble yellow.

Damn TOOTIN' it's a hedge against INFLATION AND DEFLATION - as "OLD-GOLD" so correctly indicated earlier.

(Fri Apr 17 1998 16:21 - ID#348286)
@Jeremy 16:06 - Good Post!
AU 320 coming soon to a Gold store near you.........

(Fri Apr 17 1998 16:32 - ID#286230)
Open-Loop You have me worried. What countru do you live in?

(Fri Apr 17 1998 16:35 - ID#373403)
1994.03 4251.6
1994.04 4265.6
1994.05 4269.9
1994.06 4269.3
1994.07 4290.5
1994.08 4289.1
1994.09 4298.2
1994.10 4307.9
1994.11 4319.4
1994.12 4333.6
1995.01 4356.9
1995.02 4362.6
1995.03 4374.3 $122.7 Billion for previous 12 months
1995.04 4401.7
1995.05 4435.0
1995.06 4472.8
1995.07 4503.1
1995.08 4531.2
1995.09 4554.3
1995.10 4571.1
1995.11 4583.0
1995.12 4595.6
1996.01 4626.9
1996.02 4658.8
1996.03 4692.3 $318 Billion for previous 12 months
1996.04 4710.2
1996.05 4739.3
1996.06 4764.3
1996.07 4783.6
1996.08 4801.7
1996.09 4832.1
1996.10 4867.1
1996.11 4894.2
1996.12 4935.5
1997.01 4961.1
1997.02 4997.8
1997.03 5032.0 $339.7 Billion for previous 12 months
1997.04 5075.2
1997.05 5091.2
1997.06 5114.3
1997.07 5154.1
1997.08 5199.1
1997.09 5236.8
1997.10 5274.5
1997.11 5329.1
1997.12 5382.6
1998.01 5430.2
1998.02 5467.7
1998.03 5529.9 $497 Billion for previous 12 months

March 1998 saw M3 increase $62.2 billion or 1.12% for the month. Pump, pump, pump.......Kaboom!

(Fri Apr 17 1998 16:38 - ID#26793)
Dow/Gold Ratio = 29.85 A year ago today the ratio was 19.56. That was also the low for the past year. The high was 30.54 on 20 March 98

(Fri Apr 17 1998 16:39 - ID#251166)
@ Ted ----- Heavy! Lincoln-Nixon too!

Nixon rode a Lincoln.
Lincoln had a horse named Dick.

(Fri Apr 17 1998 16:41 - ID#57232)
Repeat of the 1920-1930 period more likely
Old Gold: I think the serial deflationary events of the 20's, with the USA being the final 'flight to safety' market, is the most likely scenario. Just like in the 20's the Fed was encouraged to inflate the money supply because of fears that tight US money would make the depressed Asian/European situation worse.

My guess is that the serial deflationary events will continue, and the US markets will continue to rally for a time as one by one other markets drop. As the US market bubble rises, concerns about the future ( not necessarily inflationary ) will cause gold and gold stocks to rally along with the markets. As FV has said, the equilibrium price of gold is about $600/oz, even without any inflation. Some inflation might return to weaken the markets, and push the price of gold up even more. Finally, the US market bubble will collapse under its own weight, as the 'flight to safety' surge dries up.

I agree with Mike Sheller's assessment that the really big upward move in gold will probably not be until 2005-2010 or so when inflation will come back with a vengeance.

(Fri Apr 17 1998 16:41 - ID#254269)
to see if my computer is still alive !

(Fri Apr 17 1998 16:41 - ID#267276)
I agree THE CREATURE FROM JECKYL ISLAND is a great book about the Fed. I also recommend SECRETS OF THE FEDERAL RESERVE by Eustice Mullins.

(Fri Apr 17 1998 16:43 - ID#26793)
XAU/Spot Ratio = .273 A year ago the ratio was .289. During the past year the ratio high of .330 was set on 30 September 1997. The ratio low during the past year was .222 set on 12 January 1998.

(Fri Apr 17 1998 16:44 - ID#267276)
I own some RYO and I have my fingers crossed. We really need a push up in the price of gold.

(Fri Apr 17 1998 16:45 - ID#340302)
F*'s Evaluation of the GOLD market...
The gold market maintained relatively light volumes today and the POG ended up essentially flat. The lull before the storm. In the face of another strong record performance by the DOW & great strength in the NASDAQ, the XAU fell moderately, thereby confirming its negative beta to general equities. This is EXTREMELY BULLISH as it once again re-asserts gold's contrarian function to the market...and is a strong indication that when industrial equities and bonds soon tank, then gold equities will move rapidly North as liquidity seeks an alternative investment repository.

Although in the past, I have tended to snicker at the prognostications of Mr. Another, I must say that his timing is uncanny...maybe we speak to the same people? In any event, I would love to know the source of his information about unfolding events.

If you did not get on board the gold bull train today...or if ( heaven forbid ) you did not eliminate your shorts, then all I can say is my heart goes out to you...NOT. You will "enjoy" the next week immensely.

No comment today on either the Kitco Barometer or Precious Metals Relativity Index today. Once again, I have been on the phone most of the morning and have not paid any attention to either indicator ( In fact, I barely paid any attention to any of the markets today. However, I did note ( and benefit from ) the significant internet stock disaster today ) . Again, impending fundamental events supersede the immediate usefulness of these two self-designed indicators.

Fundamentech analysis...that's the key. It beats sole reliance upon the charts any day of the week. Connecting dots...filling's a lot of fun... but sometimes fundamental events occur that just blow technical patterns out of the water.



(Fri Apr 17 1998 16:46 - ID#212197)
@Aragorn, mozel: Don't forget the origin of money creation.
It was the business of the goldsmiths in the dark ages. The honest ones held the gold pieces for their customers ( i.e., gold on behalf of their customers ) and gave the customers a certificate. These gold certificates were used by the owners of the gold to exchange goods: houses, horses, all kind of things. They could be certain that they could exchange their certificate for their piece of gold any time. Could they?
As long as the goldsmith was honest:YES.

But these goldsmiths found out that rarely all customers asked all at the same time for their gold in exchange for the certificates. The more the goldsmiths could make their customers believe that it was completely stupid to come for exchanging a certificate into gold and then back again into a certificate, the more the goldsmiths could start trusting the law of statistics and give out a certificate ( for instance to buy a house for themselves ) without coverage.

This means: they slowly learned to create uncovered certificates in small quantities. What means that ? They created money out of thin air.
O.k. some of them liked this type of business so much that they exaggerated the creation of gold certificates and when the customers got suspicious they panicked to the goldsmith and only the first ones where lucky and the rest realized that they had just a worthless piece of paper in their hands.

But to deal with this magic of creating money out of thin air in the "correct" way, which means, to always be ready to give out gold for a certificate, this became the know-how of some very successfull bankers ( Mayer Amschel Bauer from Frankfurt, who changed his name later into Roth-schild, means "red shield", was one of them ) .

Truly, the real big business in this goldsmith's job was the creation of money out of thin air.

The above is easy to understand. We should not forget the origin of this "honorable" business when we discuss creation of money today.

I will never believe that the proceeds of T-bills, sold by the Ney York FED will end up in a black hole, so to say, vacuum cleaned away in order to reduce the money in circulation.

The reason why the FED is in private banker's hand is the creation of money out of thin air. That's the big big business.

But I admit, I do not understand, how the proceeds of T-bill sales end up in the private banker's hands.

I only understand how it worked in the dark ages. The Rothchilds are ahead of us in their know-how to obtain the full advantage of creating money and have the monopoly for it.

I will set a price if somebody can explain this to me. How does the T-bill proceeds end up in private banker's hands?
The price of honor shall be an American Eagle, one thenth of an ounce.
The person who gives the first perfect explanation shall be awarded this price.
In case of doubt a kitco committee needs to decide who the awardwinner should be.

Alberich the Dwarf

(Fri Apr 17 1998 16:46 - ID#26793)
Gold/Silver Ratio = 49.53 A year ago the ratio was 71.36

(Fri Apr 17 1998 16:54 - ID#252150)
DA@Your Debt Monetization Scenario
One of the ways that this period can end, which has never really been discussed here at
Kitco, is the large scale monetization of government debt. In this version of the end game,
bond prices do not go down in nominal terms because the government simply prints money to
buy them back. As long as this policy is followed by all major governments, there is no
relative currency debacle, because all currencies are being devalued simultaneously. In this
version, the stock market does not go down either. What does happen is that the price of a
loaf of bread goes up a whole lot, as does the price of a house, a car, a movie ticket or
heaven forbid, gold.

And how do you think that the bond vigilantes will respond to the 1st whif of inflation?

(Fri Apr 17 1998 16:55 - ID#26793)
Important notice for all you BIS shareholders

(Fri Apr 17 1998 16:56 - ID#261269)
F*...Farfel...the unpronounceable...whatz the
events that are going to happen "next Week" that confirms ANOTHER's comments and your exuberance?? In other words...whatzup?? Thanks : )

(Fri Apr 17 1998 16:56 - ID#410198)
There goes my theory about a big week for gold,will try again next week,sooner or later I'll be
right : ) )

(Fri Apr 17 1998 16:57 - ID#286279)
Nice post. Thanks!

(Fri Apr 17 1998 17:03 - ID#153102)
@Understanding the Federal Reserve @What's Up
is a frigging waste of time. The only use of the "banking system" is to keep up a facade for the thugs in the Federal Mafia. The leverage the bankers and lawyers have is that they serve as props for the con.

Printed paper legal tender is the robbery. Do they really need the Federal Reserve for that ? When it becomes inconvenient, they will jettison the FRS and self-righteously hang the bankers to satisfy the mob.

What's up is that it is totally unworkable for the "currency" of the world's debtor country to be the reserve "currency" for trade and banking. Japan is a trade sinkhole. Their whole system is set up and managed so they can hoard from trade. A trade advantage from an underweighted Yen is essential to it. There sure ain't no golden rule operating. If they can't even operate a country bank, can they be bankers to the world ?

After WWI, the situation existed wherein the world's debtor nation also provided its reserve currency. The United States was the Japan of then. It agreed that British paper would be as good as gold just as the Japanese have agreed that US paper is as good as gold. That similarity noted, we have never been in this place before. The first impulse of socialists is competitive advantage from rule making. Hence, more rules like the EC rule on cadmium are predictable. The second impulse is competitive advantage from currency devaliuation. What, except a gold basis for trade or a martially imposed universal fiat "currency", will prevent it ?

In this world of official criminal enterprise, it seems forlorn to me that D.A. can imagine there is safety in hugging South American trees.

(Fri Apr 17 1998 17:04 - ID#286279)
Ron, all
If tomatoes are a staple for you, start growing some now. A small farmer here says that the rain/dampness have ruined tomato crop.

(Fri Apr 17 1998 17:10 - ID#340302)
@JIMS...with respect to your question about the Japanese & Gold... know, you are somewhat correct.

During the Eighties, the Japanese took it on the chin holding useless American treasuries ( owing to U.S. dollar weakness against the Yen ) instead of placing their Yen profits in their own surging stock market. If only they had followed America's selfish example today.

Yes, there is little doubt that there are benefits to receiving higher yields in U.S. treasuries versus low to non-existent yields in the Japanese equivalents...provided the U.S. dollar remains strong, that is.

However, if the Japanese were smart ( and God knows they really are ) , then
they would sell off most of their treasuries, take the cash, and put it back into their own indigenous investmemts...and also take a nice, hefty slice of the treasuries proceeds and buy up gold and silver. They would make extremely hefty profits and simultaneously throw the entire global economic system into chaos.

Why would they want chaos, you might ask?

Well, remember, Jims, they are already entrenched in a condition of domestic chaos. They are already stronger than us in that sense...they live with chaos on a daily basis so it no longer presents the same degree of fear that any such equivalent chaos might present to complacent, full-bellied Americans.

Remember, not addressing the Japanese economic concerns through dramatic remedial not providing a means by which the Japanese can maintain face and avoid shame... in hoping that the Japanese Disease will simply cure itself and disappear on its own....America is ignoring the essentially Kamikaze nature of the Japanese psyche.

Take everything down with them...hey, why not?

It surely could not be worse than the slow, humiliating, frustrating death they are experiencing now.



Aragorn III
(Fri Apr 17 1998 17:11 - ID#212323)
Some thoughts for A.Goose in regard to COMEX and G*O*L*D
A.Goose, together let us spin this little tale a bit further. In your previous post you said, "1.8 million paprer ounces traded yesterday and NOT ONE ounce of actual physical gold changed at comex. ( It's a paper game ) . Buy and take delivery."

Wouldn't that be fun? Buy...and take DELIVERY! The COMEX administrators would be completely bewildered..."Someone took our window dressing!"

In our little tale, that is the primary role of the eligible gold stock in COMEX; window dressing. It is their store-front display, as recommended by gurus on Madison Ave, that advertises their line of business. With a warm yellow glow these eligible stocks call out to the would-be customers, "Get your Gold Insurance here!"

When gold producers and gold users buy contracts through COMEX, they are simply taking out a paper insurance policy against movements in price-of-gold that would be adverse to their operation. As the price of gold moves up or down, these 'insurance' policies are settled for cash. The actual gold that is purchased by the users or sold by the producers rarely pass through the COMEX system. COMEX is not so much a physical gold broker as it is a price hedging insurance company. Of course, speculators take part in the trading also, and we know full well they are not interested in physical delivery to OR from COMEX. It is just like speculating in the grain futures when you are not a farmer. The system was set up to offer some price protection for producers and consumers, yet if an easy buck can be made the speculators dominate the activity.

The physical gold used in industry, for bullion, for jewelry, etc is generally obtained directly from the refineries. Cash made by settling the COMEX contracts is used to offset the actual spot price paid at delivery over the value at which they locked-in their desired purchase price on COMEX insurance paper. That is why contracts move, yet the gold gathers dust. It's only window dressing. is very important window dressing because it gives the illusion of 'gold in abundance.' If someone where to use COMEX rather than the refineries as their gold source by treating their contract as a purchase order, as the inventory fell to zero the gold and currency markets would unravel due to the changing public perception regarding gold's 'abundance'.

In our gold tale, COMEX is in the business of selling price-insurance and little more. LBMA is a different matter. LBMA is a banking system, or more appropriately a clearing house that settles international transactions that utilize gold as the method of payment. Think of it as a large scale e-gold ( TM ) system. The gold is registered in accounts and held in a variety of locations. Through LBMA the database is constantly altered to reflect the changing ownership. The same gold may change hands many times a day, a week, a month, etc. resulting in tremendous apparent volume WITH NO IMPACT ON THE PRICE OF GOLD! Germany may pay Saudi Arabia gold for oil, while that same gold is then paid to the US in return for wheat, while the US pays that same gold to China for toys, textiles, etc. Gold is money through the LBMA. Through the twice daily price-fixing, the LBMA establishes the official exchange rates for these transactions.

This is where ANOTHER with his THOUGHTS! adds to the tale. While the real world ( the world of the common citizen ) uses fiat currencies much to the pleasure of the central banks and world governments, the oil producing organizations that transact through the LBMA are getting a raw deal. Because the price of oil is the primary influence in the state of a nation's economy, it has been artificially maintained at a low fiat dollar price over the years while the price of other comodities have risen as a result of inflation. In their terms, wheat is overpriced, and their purchasing power falls further with the falling price of gold. Only when all things are priced directly in gold will the relative value of oil and gold versus other comodities be properly established. At that time, the price of things in terms of dollars becomes meaningless. No amount of fiat paper will buy gold. Gold will only be yielded up from its owner in exchange for labor, services, or products. You will insist on being paid in gold. For the "dollar" to have any meaning in this time, their will have to be established a true Gold Standard, wherein one dollar actually IS redeemable for some amount of gold. And the only way there would be enough gold to associate with each dollar would be to establish the exchange standard at one ounce per $30,000 or more. Buy your gold now at these artificially low exchange rates!

No artificial or government manipulation is required for this. The oil producers need only say, "Pay us US$300 per barrel of oil, or pay us 0.01oz gold per barrel--your choice!" An oil broker would quickly do the math and see that at these gold prices the amount of gold would only cost US$3 per barrel, and therefore it would be prudent to obtain as much gold as possible as the means for oil purchases. The price of gold might then be driven up to the dollar equivalent where there is no point paying more than $300 per 0.01oz ( equals $30,000 per oz ) because at that point it is cheaper to buy the oil directly with dollars.

BUT, you object, long before $300/barrel, other oil producers would come out of the woodwork. Yes, I say, but don't you agree that the damage would already be done to the fiat currencies under such a scenario? Gold will be money for everyone, and the USDollar will find its way back on the REDEEMABLE Gold Standard at a rate much higher than the previously known $20 to $35 per ounce.

So, let us start the ball rolling with the public confidence. Somebody please go SHOPPING at COMEX, and I don't mean for insurance.

(Fri Apr 17 1998 17:12 - ID#57232)
Money multiplication!
Alberich: Great post! The origin of the money velocity multiplier in parable form, leading into the Rothschilds. The one part that you left out is that there is another layer of complexity above the one you describe. Eventually all of those little goldsmiths became indebted to the Rothschilds, and the Rothschilds -- after acquiring all the gold, set up a bankers central bank, and loaned out the gold ( or gold certificates ) to be used to create more money again -- but now with strings attached.

(Fri Apr 17 1998 17:17 - ID#252150)
Pol Pot@Was indeed an evil man
The depressing thing is that the world is full of evil old men who will die a peacefull death. Conversely, many good & righteous young men are struck down early & die horrible deaths...One of the great attractions of religions is that there will be eternal damnation for the evil. I envy the believers.

(Fri Apr 17 1998 17:19 - ID#340302)
...F* will NOT be posting here at all this weekend. Taking a break to deal with other more pressing matters.

You can now expound at length as to the imminent demise of gold and its ultimate relegation to the dustbin of history...without any concern that I shall be around to refute any of your "insightful" assertions.

Go away...propagandize to your hearts content.

I am confident the many other learned goldbugs on this forum will maintain their vigilance against gold short agit-prop in my absence.

I will check back in next week for more "interesting" times, yes?



(Fri Apr 17 1998 17:23 - ID#261269)
Hey...wait a minute...F*** ...No fair...Whatz the big deal`
about "next week"??? com'on...let's have it!!

(Fri Apr 17 1998 17:24 - ID#252150)
Farfel@if your neighbor had several drooling, rabid pit bulls on his property
& you had no legal recourse against him, I doubt very much if you would want to upset him. Especially, if he had an AK47 aimed at you front door.

(Fri Apr 17 1998 17:32 - ID#252352)
kitkay and Geomaque GEO -tse, someone finally noticed NR
Excellent increase in reserves, no debt profitable, at current gold prices

Attention Business Editors:



TSE Symbol: GEO

TORONTO, April 15 /CNW/ - Geomaque Explorations Ltd. is pleased to report
a significant increase in the resource at its Vueltas del Rio deposit in
northwestern Honduras to 922,000 ounces of gold. This interim resource
estimate is based on results from drilling to January 31, 1998, and represents
an increase of 84% over the 500,000 ounce resource estimated prior to the
Company's acquisition of the property.
To date, the Company has drilled 294 holes. The majority of drilling has
been completed at an average spacing of 20 metres, resulting in 81% of the
922,000 ounce resource being classed as measured and indicated. Additional
step-out drilling to further increase the resource, and infill drilling to
upgrade the inferred resource is scheduled to begin in May.
The makeup of this internal resource estimate is as follows:

Uncut Cut ( x )
Grade Contained Grade Contained
Class Tonnes ( g/t ) ounces ( g/t ) ounces
Measured and
indicated 9,675,000 2.39 744,000 1.62 503,000
Inferred 2,932,000 1.89 178,000 1.59 150,000
Total Resource 12,607,000 2.27 922,000 1.61 653,000

( x ) High grades are cut to 20 g/t in the San Juan Zone and 25 g/t in the
Main Zone, based on a study by Roscoe Postle Associates.

Of the 744,000 ounces classed as measured and indicated, approximately
50% is contained in oxide mineralization and 50% in primary mineralization,
all of which is heap leachable with expected recoveries in excess of 70%.
Geomaque's drill program is focused on defining near-surface
mineralization to estimate mineable reserves for a feasibility study which is
expected to be completed before year end. The majority of this interim
resource lies within 100 metres of surface, with most of the measured and
indicated material within 50 metres of surface.
The Vueltas del Rio deposit remains open at depth and to the east and
west along strike. Exploration drilling in phase two of the drill program will
concentrate on defining mineralization in previously undrilled areas of the
deposit located between the Main and San Juan zones, and to the west of the
San Roberto zone.
``Using a tightly-spaced drill pattern from the outset has resulted in
the majority of the resource being classed as measured and indicated, which
will enable us to quickly upgrade resource ounces to reserves,'' said Phillip
Walford, Vice-President, Exploration. ``This resource confirms that Vueltas
del Rio is a very robust deposit with significant upside, which we expect to
be mining in 1999.''
``The results of this first phase of drilling have exceeded our
expectations,'' said John Paterson, President and Chief Executive Officer.
``When we acquired Vueltas del Rio, we were anticipating a 40,000 ounce per
year production rate; this interim resource justifies a production rate of
70,000 ounces per year at Vueltas del Rio.''

San Francisco Mine
Optimization of the San Francisco Mine is ongoing, and the Company
recently installed an additional secondary crusher and reconfigured its
crusher circuit to raise throughput to 300,000 tonnes per month. Since the
reconfiguration, the crusher has produced in excess of the budgeted rate of
10,000 tonnes per day.

Geomaque Explorations Ltd. is an international gold mining and
exploration company producing gold from its 100%-owned San Francisco Mine in
the State of Sonora, Mexico, and exploring for gold in Latin America.

For further information: please contact Sean Stokes, Manager, Investor
Relations, ( 416 ) 956-7470,,

(Fri Apr 17 1998 17:32 - ID#252127)
PDG to Invest $41.3 million in Vengold

Beware those who may blasheme the Golden Cheesehead.
Vengold has excellent managers and they will soon show their stuff

(Fri Apr 17 1998 17:41 - ID#333126)
re: Farfel@17:10
couldn't have put it better myself.

the Japanese are in a quandry -- what will they do? go down in blazes or bring America down together with them? how much more US bonds do they still own?

hmmmm............... i need a good drink ( tequila, maybe? )

(Fri Apr 17 1998 17:51 - ID#201238)
comex data

COMEX Metal Warehouse Statistics for April 17
Gold 634,304 + 0 troy ounces
Silver 89,480,415 + 1,364,629 troy ounces
Copper 110,820 - 644 short tons

(Fri Apr 17 1998 17:55 - ID#153102)
Giving a certificate for redemption of something you don't have is fraud.
The fraudulent goldsmith, when found out, got hung.

The crime in the United States is printed paper legal tender. It is armed robbery. The fraud of fractional "reserve" "money creation" is fraud by the receivers of the proceeds of armed robbery.

The Rotschilds of this world are the handmaidens of crime, but the Bride is Criminal Government. And there is another kind.

A Treasury is just an interest bearing Note for non-interest bearing Notes ( Federal Reserve Notes ) . They have to bear interest so they will be bought by somebody. The myth that domestic banks control governments is poppycock. Governments license banks and tax banks and rule over banks with regulations and close banks. Domestic Banks are just props for the fraudulent pretense. Like lawyers.

Aragorn III
(Fri Apr 17 1998 18:11 - ID#212323) more stab at a clearer answer for your question--
"I will set a price if somebody can explain this to me. How does the
T-bill proceeds end up in private banker's hands?"
The proceeds are only, and exactly, the difference between the banker's purchase price and his selling price.

The banking industry as a whole is founded on the shoulders of the FED. These FED banks do not have a cash account per se in their dealings with the US Treasury. They buy T-notes and hold them, and sell them back to the Treasury upon maturity. They keep the interest, but the portion of the payback that equals the original purchase price is struck from the books, obliterated from existence. When they sell T-notes to you and me in order to mop up excessive liquidity ( with the intent to reign in inflation ) , their proceeds are once again the buy/sell difference.

Their competitive advantage is that the 'principle' for these 'loans' are created out of thin air to any required amount, and when the loans are ultimately paid off at maturity, the bank keeps the 'interest' while the T-note and original principle cancel each other out on the ledger.
Please read my ealier post today regarding the national debt and Fiat 101 for the complete picture. This interest income for the FED is guaranteed to grow and grow without end. THAT is the proceeds that keep them smiling.

Aragorn III
(Fri Apr 17 1998 18:16 - ID#212323)
Note to self...
Shaddup and go drink some beer. Reply to self... So it shall be!

(Fri Apr 17 1998 18:24 - ID#288369)
@Cuba Libre! Mighty fire in the belly of......
The StradMaster re: pol pot. Play on!

(Fri Apr 17 1998 18:30 - ID#344239)

(Fri Apr 17 1998 18:40 - ID#153102)
@Alberich & AragornIII
If paper can be printed and then collected and burned with no consequence except cancelling entries in ledgers, what is that but a "black hole" at will ?

That's what they do with Federal Reserve Notes. If you just make them interest bearing Notes on Notes, the basic operation is the same. It hardly matters if the interest receivers are inside or outside the system, does it ? Those inside receive interest as part of the license and franchise bestowed on them for the benefit of Congress. Those outside receive interest for Notes. Those outside set the market rate for interest. This has the sole purpose of maintaining the pretense that Congress is borrowing when actually it is just creating credit out of thin air on the full faith and credit in and of itself. That's confidence.

Mike Sheller
(Fri Apr 17 1998 18:46 - ID#347447)
Cuba Libre mi coulo! Esta una "Mentirita!"

(Fri Apr 17 1998 18:47 - ID#57232)
Paper money versus gold
mozel: Appreciate your comments regarding what used to happen to Goldsmiths that failed to have enough gold to pay off their customers when the customers wanted their gold back.

One advantage of 'fiat' money is that you do not have to worry about keeping anything as collateral. Can't get hanged if you do not need to produce collateral.

What amazes me is that the 'fiat' currency works as well as it does. The stock markets are kept up by their own bootstraps -- simply based on faith. The same for 'fiat' currency.

And the assets for our stock markets are kept in 'fiat' currency. Thus our stock markets are two levels removed from reality. Frightening thought.

How many people, if they thought about that, would want their life savings nearly 100% invested in the equity markets?

Imagine a house built on faith, not bricks and mortar.

Who would want to live in it?

(Fri Apr 17 1998 18:57 - ID#267344)
Mozel, Aragorn, Alberich & ALL
This whole FED/T-Bill thing is very interesting, but a bit complicated for my level of understanding. My brains hurt! I think I'll stick with gold. Meanwhile, it appears that I have yet another book to read. Thank you all for increasing the general awareness of the monetary schemes of the USG! As one has previously pointed out, the past 24 hours at this site have been a revisit of past Kitco golden days. Let's maintain this level of quality. The only contribution I can possibly make at this time is to voice my appreciation and applause. Wishing all a great weekend!
- c

(Fri Apr 17 1998 18:59 - ID#288369)
Que es una mentirita y que es un coulo? Muchos anos pasan ( since ) yo hablo espanol. Muchas Garcias! Ouzo es bueno? Si?

(Fri Apr 17 1998 19:11 - ID#300202)
Mozel et al
Enlightening posts such as yours help generate deeper thoughts & bring
a new level of understanding to this Kitco community. I also have a
hard time discerning intelligence/information which is new to myself &
I am sure to numerous others . Be assured that posts such as yours
are appreciated for the qualities that they surface. Gone for a wine.
Thanks guys.

(Fri Apr 17 1998 19:14 - ID#298259)
Pegasus Yr End Results...&... Chapter 11 Reorganization Update...

(Fri Apr 17 1998 19:21 - ID#26793)
Stock markets are kept up in fiat dollars by the illusion of earnings and profits, not by real profits and earnings. Investors think they are better off due to the illusion.

For example; they think they had a new high on the Dow today and that is just not the case. The Dow closed at 616.99 today in pre 1934 dollars, down 2.26% from the real dollar high of 631.26 set on March 20th. Inflation is designed to confuse you. It didn't work for the Romans and it won't work for us. Truth will out.

(Fri Apr 17 1998 19:43 - ID#176200)
@farfel.surrogate ANOTHER? Thanks!

(Fri Apr 17 1998 19:47 - ID#248180)
PGM's - Russia News

Russia will export "approximately as much" platinum and palladium this year as in 1997, Sergei Gorny, deputy general director of the Almazjuvelirexport foreign trade company, told Interfax. Gorny said that Sergei Kiriyenko, the acting prime minister, had signed an order Monday this week on quotas for platinum-group metal exports, and that this would be followed by "a number of documents from the relevant bodies," among them the Ministry of Foreign Economic Relations and Trade. He said he could not say for certain how much time would be needed for the necessary documents and licenses to be prepared. Kiriyenko, for his part, in an interview with Interfax declined to confirm that he had signed the quota resolution on the grounds that information in this area must be restricted. However he did say that "all the necessary decisions have been made, they are regular and correct, and state interests are protected." Valery Goncharov, the official in charge of sales, accounting and pricing at the State Reserve for Precious Metals and Stones ( Gokhran ) , told Interfax that it could be "weeks, even months" before Russian platinum metals hit the market. The Gokhran has not bought platinum-group metals from Arctic mining and smelting giant Norilsk Nickel since the middle of 1996. A source at Norilsk Nickel, which produces about 95% of Russia's platinum metals, told Interfax that the delay had cost the company about $50 million. The Gokhran, the source said, is the only buyer of the metals. The source said the delay is also hurting the company, which is one of the world's biggest nickel producers, because world prices for this metal are falling. Norilsk Nickel supplies about a fifth of the world's nickel and platinum more than two-fifths of its palladium. Russia is the world's biggest palladium producer and its second biggest platinum producer. Last year, it started to export the metals, which are used mainly by the electronics and automotive industries, as late as July. The uncertainty surrounding Russian exports has pushed world prices for platinum to a seven-year high, and those for palladium are higher than they have been for 18 years. Goncharov said that world price trends are very good at the moment. However, experts suggest that prices could fall back to their previous levels before specific negotiations on procurement contracts begin.

Back to the Industry Page

Copyright  1998 Interfax, Moscow. All rights reserved.

(Fri Apr 17 1998 20:04 - ID#153102)
It's less built on faith than on confidence. Confidence that you and me can be intimidated either by legal authority or by martial authority. Confidence that the repeated lie delivered with boldness and conviction and camouflaged with legal jargon can submerge the truth. Confidence that selective and well publicized prosecutions and occasional displays of raw aggression and a standing army will cow the people.

So, the question is who wants to live in a House of Treachery, Lies, and Fear ?

(Fri Apr 17 1998 20:12 - ID#31868)
mozel, quite correct, it is built
on the gun and death utlized as the law.

(Fri Apr 17 1998 20:12 - ID#26669)
Aragorn_III re your 18:11
To misquote one of your long lost Hobbits, I believe from 'The Fellowship of the Ring' what you seem to be saying it that the Fed actually seems fair but is foul indeed. The whole thing is beginning to be surreal, like the invention of a Cargo Cult chieftain. I think I'll get a beer, too.

(Fri Apr 17 1998 20:13 - ID#256326)
Thanks for posting the Pig-asses piece. This was a test case for the gold lenders in the forward sales scam. Pig-asses got caught the wrong way and had their legs pulled off one by one. I suspect other "forward looking" miners will get dismembered the same way before it's all over.

(Fri Apr 17 1998 20:15 - ID#153102)
In a word, terrorism.

(Fri Apr 17 1998 20:24 - ID#260252)
Muchas Gracias
Much thanks to all who continue to post the excellent and timely information presented here, be it fundamental or technical analysis, metals/market observations or up-to-the-minute relevant news. As a new and young lurker over the last couple of months, I have had my eyes opened and mind expanded to some spectacular facts and opinions, predictions and other bits of information which I believe to be invaluable at this time. I greatly appreciate it as I'm sure others do.

I also enjoy the humor presented here for the breaks it provides and the back and forth between posters ( when it doesn't get too out of hand. )

As we look back on the week that was, and forward to the coming weeks full of new and positive bullish developments for PM's, I urge those of you who have "left" this forum, but are still lurking, to comeback and continue to post as many of us undoubtedly have still much to learn concerning PM's.


(Fri Apr 17 1998 20:28 - ID#238295)
RJ the Popinjay
All who expect a gold bull must realize they are defying one of the ten commandments of financial wisdom as proclaimed by RJ, the popinjay -- everything, absolutely everything indicates that gold will be down to $280 by June. Only certifiable lunatics can even entertain the possibility that AU might be $340 or higher by then. Most here have opinions on where POG is going, but RJ the popinjay KNOWS it will be down to $280 by June

Much of the sour talk about stocks here represents sour grapes methinks. Best to reflect on why many here missed the stock bull to a great extent. But gold's day is coming and soon. Those who abandon the yellow now will never be able to catch up with the dipsters.

(Fri Apr 17 1998 20:49 - ID#26669)
JPost Says inflation 0.1% for 1Q98

(Fri Apr 17 1998 20:52 - ID#210114)
1964 Silver Kennedy Half-Dollar
Does anyone know what this coin retails for in the United States??

PH in LA
(Fri Apr 17 1998 20:55 - ID#225408)
Positive benefits of fiat-based inflation????
Mozel, Aragorn, et al:

OK. The concept of interest on something created out of thin air seems to fly in the face of fairness and all would agree that the ( perhaps ) unintended result is inflation. But isn't there room for an honest wage, if you will, accrueing to the bankers for their productivity ( read: work and bookkeeping ) involved in keeping the system functioning?

I mean, it does seem, in broadest terms at least, to work on a day-to-day basis. If we the people could keep a tighter reign on the politicians who want to perpetuate their regimes by spending too lavishly, wouldn't the system work?

The store of value implied in a monetary system IS being subverted to an extent, but consider the alternative. In Spain ( a country I am more than passingly familiar with ) the focus of society is much more linear. By that I mean that wealth is encouraged to remain in families over generations. Iniciative is stiffled on many levels. There are few impediments to the retention of wealth over generations. In this country ( USA ) there are much higher estate taxes etc. The idea being that the individual here is much more expected to make his own way in life, rather than expecting his ancestors ( and society ) to take care of him. This is argueably a legacy of our frontier-conquering past but it is conspicuably absent in South America, with their Spanish-inspired heritage. The implied inflation inherent in our monetary system can be seen as just another tool of society designed to bring about this result.

Just a thought.

(Fri Apr 17 1998 21:01 - ID#26669)
More on the US trade deficit

(Fri Apr 17 1998 21:03 - ID#284255)
@ Lock & Lode - Great post regarding Market Crashes
The excerpt in posted comes from the above mentioned site.
If you go there and have a look you will find a long lengthy article on the subject.
I lifted those few paragraphs from the end of the article.
There is also another page linked at the bottom of the page which summarizes where we stand now.
I don't agree with all of the article but it does give a good overview.

(Fri Apr 17 1998 21:08 - ID#348129)
If being in the equities markets means buying and holding stocks like YAHOO! at $120/share or 350 ! times earnings, then i'll gladdly stay out,
and stick with $280 Gold.
If only 3% of the money invested in US equities comes running for a haven in Gold at any time, it will set off the next great Gold bull to continue well into the next millenium.
BUY and HOLD !

(Fri Apr 17 1998 21:15 - ID#230216)
ANOTHER reason I like kitcoites.....
Y'all seem to know about imbibing..... ( one of EB's 'hobbies' ) ...

Yo quiero beber muchas cervezas esta noche......Si!... ( can't make those cool tildes and accents on my work 'puter....dammit! ) life is STILL I must get home to slug down a cold one...uh huh. This grinding stuff can wait.................. ( gulp-gulp ) ...go gold.

Hey Bart! have you delivered my mountie ( singular ) yet?? Did you run out? Has StudioR bought them all?? I'm flying to Studio7 this weekend to steal me a few and knock around that geetar player.........and drink cuba libre's.....yum yum. the road

EB ;- )

(Fri Apr 17 1998 21:18 - ID#26669)
New housing starts

(Fri Apr 17 1998 21:20 - ID#230216), BUCKETS of worms......
George ( GSC ) ....aka...Old Gold........

Popinjay??? C'mon George....ya really don't want to be going there.....let it will not may end up stepping on your 'Johnson'............ ( ouch ) . put on the kevlar for battle

(Fri Apr 17 1998 21:22 - ID#284255)
@ Old Gold
I think you are to harsh on RJ.
He like Oldman are players of the market.
Fancy footwork playing it both ways.
They have the concept of SAR down to a art.
Short term masters @ "the art of pillaging profits."

Just like Oldman, RJ tries to pluck money out of the market.
Catching the small swings between the bigger moves.

On a long term perspective,
RJ told me recently that he had moved some personal long term funds into gold.
So on the long term he is on the bull side - for what he sees coming.
And on the short term - he plays it like a master squeezing profits from both sides of the trend.

I admire the man for his ability to be able to play both games at the same time.
Also he calls his shots as he sees them - like us all.
He carries the strength of conviction to do what he does successfully.

Is he not worthy of respect?

Deriding the man profits no one.


(Fri Apr 17 1998 21:23 - ID#153102)
Consider this linear feature: Rockefeller Foundation, Ford Foundation, etc. Do you know anything about Trusts ? Go to Dartmouth and look around.

Making Your Own Way in America from Cradle to Grave with Government Assistance. Are we in the same country ?

You are a victim of armed robbery via printed paper legal tender. Fixating on interest to me is like reporting your trampled flowers to the police but omitting mention of the armed robber that stepped on them.

(Fri Apr 17 1998 21:25 - ID#230216)
same message....different styles...
thanks Sharefin......great minds...... ( etc ) .

(Fri Apr 17 1998 21:26 - ID#210114)
1964 Silver Kennedy Half-Dollar
Does anyone know what this coin retails for in the United States?

Gianni Dioro__A
(Fri Apr 17 1998 21:27 - ID#384350)
@lock&lode, Inflation
Okay because there is the Evil Fed, it confounds things. Think if the Fed didn't exist and that there was no gold standard. If the govt wanted something it would just print currency.

The currency that the govt prints and spends competes with the currency in your pocket in bidding for goods, services, or other assets. The currency in your pocket isn't necessarily excess, but it is becoming worth less ( 1 word or 2? ) . It should be obvious govt spending is inflationary.

Now the govt realises that if through taxation, it can take away your competing dollars, there will be less inflation or none at all if it takes away enough of your buying power.

This taxation is taking currency out of circulation. You bring up a good point that if there were rampant inflation everyone would see what the govt was up to and would take measures to stop it. A boiling frog, you said. Agreed! The enemy you can't see is far more dangerous than the one you can see.

Gianni Dioro__A
(Fri Apr 17 1998 21:33 - ID#384350)
open-loop, thanks for the kind words
Yeah, that bank teller has got a lot of nerve asking you what you want to do with YOUR money.

This year 2K might just be a blessing in disguise. Now hardworking, honest individuals like ourselves have an excuse to withdrawl our wealth from the banking system, put it into something like Silver & Gold and then bring it back into the economy post 2000. No paper trails! No nothing!

(Fri Apr 17 1998 21:33 - ID#230216)
Ron in the sack
good to have you back mate.....where ya' been? Stick around. It is not mine ( away ) ...I 'borrowed' it myself and made it my own. Won't tell ya where but it is from some dude in the Bay area.....years ago....ANOTHER time. Anyone know?? The quiz of the eve.... ( prizes involved ) ... ;- )

away ( ! )


(Fri Apr 17 1998 21:37 - ID#210114)
Gold building support; silver in trouble (?)

[ Business | US Market | Industry | IPO | S&P | International | PRNews | BizWire | Finance Home ]

Friday April 17, 6:34 am Eastern Time

Platinum metals volatile, gold and silver quiet

LONDON, April 17 ( Reuters ) - Palladium trade was choppy in early European trade on Friday
amid continuing uncertainty over Russian platinum group metal ( PGM ) supplies, dealers said.

But gold and silver were quiet with gold fixed higher in London.

Palladium was last quoted at $300.00/$305.00 an ounce from the close at $297.00/$300.00 after
being fixed higher at $301.50 against the previous fix at $296.50.

Dealers said palladium remained volatile on uncertainty over Russian PGM exports and was
sensitive to any news in the market. But it ignored news that the Russian lower house of parliament,
the Duma, rejected the nomination of Sergei Kiriyenko -- who last week signed a government order
setting PGMs export quotas -- as prime minister.

Russia said last week that acting Prime Minister Kiriyenko signed the orders setting PGMs export
quotas but on Thursday, the state precious metals reserve said it could still be weeks or months
before PGMs are released onto the market.

``Palladium is sensitive to everything at the moment. Things will obviously focus there and the
so-called signing of the release document by Kiriyenko who was not supposed to be voted into
office until today,'' one dealer said.

Russia last year supplied about 60 percent of the world's palladium and up to a fifth of its platinum
and prices have soared on the export problems.

Gold was last quoted at $308.25/$308.75 an ounce, up from the New York close at
$307.90/$308.40. Dealers said gold was quiet and should find support around the
$307.00/$307.50 level.

``People are a little less inclined to want to go and sell gold today, with it having tested its mettle so
strongly yesterday,'' the dealer said.

Gold held above $306.00 under heavy pressure on Thursday.

Brokers GNI said gold and silver staged a recovery overnight after comments from the International
Monetary Fund that the United Kingdom and U.S. still needed to remain vigilant on inflation.

Dealers said silver remained vulnerable.

``Silver is the most vulnerable of all the metals, it seems to have run out of momentum to the
upside,'' the dealer said.

Gianni Dioro__A
(Fri Apr 17 1998 21:39 - ID#384350)
mozel, US shirking responsibility
It's only logical. Good point.

Lan Man
(Fri Apr 17 1998 21:50 - ID#320108)
@ Gianni Dioro Y2K and
My thoughts exactly. In addition, people can increase the percentage of "Less Cash" when making deposits. Instead of using plastic everywhere they shop, use cash whenever possible. When the question does come up why I like to use cash the answers that most can relate to is "I don't like paying interest" or "Tight budget" or "I hate to spend so much time in balancing my checkbook". It constantly amazes me how few people have actually seen the new $100 much less the $50.

(Fri Apr 17 1998 21:56 - ID#65118)
@Gianni re: banks.nosey.adios
That be the plan! But with one possible exception.
I may never bring it back to the system because it may be too
broken. Myself and a couple of goldmeisters plan on camping
out in front of the gold broker place when everybody heads
for the door in the DOWn with lawn chair loungers and tropical ( adult )
beverages and we cant forget the bawann bob hats and dark glasses just
to watch the feeding frenzy. I have seen crazy women shoppers at
K mart on a sale day but this should be alot better. Short but furious
feeding frenzy. Today they set yet another record on wall street amidst Asia markets still free-falling. I am surrounded mostly by people
who believe with all thier hearts ( and money ) that it CAN'T and WON'T
happen here. I have been ridiculed many times for being a goldbug so
I just keep my mouth shut! WHY BOTHER?? What goes around comes around!!

Thanks and have a great weekend!

(Fri Apr 17 1998 21:59 - ID#284255)
For the unbelievers?
FOCUS-Dow index seen hitting 35,000 in 10 years - analyst
Investors who have missed out on the current stock runup should be cautious.

``It's too late to throw money into this bull market and most people should be waiting for better buying opportunities later this year,'' Dent said. ``When the correction comes, they should not hesitate, even with the market down 2,000 to 3,000 points, they'll have the greatest buying opportunity.''

Dent said the 80 million Americans born after the Second World War until the early 1960s, the so-called Baby Boom generation, as well as the information revolution propelled by the growing use of computers and the Internet, will propel the market higher.

``The Boomers' spending will drive predictable cycles that parallel the economy and stock market,'' Dent said. ``In fact, the computer information revolution that's just beginning now will change our lives far more than the assembly-line revolution of the last century.''
Dow roars back to third record close of the week
NY precious metals end mixed on low volumes

NEW YORK, April 17 ( Reuters ) - COMEX and NYMEX precious
metals futures ended mixed on low volumes Friday.
"There was a little light fund selling in gold and some
activity around the May/July roll in silver, but overall it was
a featureless low volume day," said John Tyree, a broker with
FIMAT in New York.
COMEX June gold ended down 40 cents at $309.40 an ounce,
after trading a $310.50-308.30 range. Total COMEX gold volume
was estimated at a light 12,000 lots.
In the bullion market, spot gold ended quoted $307.50/00,
compared to the London Friday afternoon fix at $308.45 and the
New York close Thursday around $307.90/40.
Implied lease rate for gold were little changed around 1.15
pct for one month and 1.95 pct for 12 months.
After seeing 18 year lows in mid-January at $277.00 an
ounce, spot gold prices recovered to their highest levels since
last November last week, with central banks sales abating ahead
of decisions about the role of gold in EMU due in the summer.
"At present 20 pct of the national gold reserves of member
countries are allocated to the European Monetary Institute
( EMI ) , the precursor to a European central bank," said Jeffrey
Christian, managing director of industry analyst, CPM Group.
"This has been the case since 1978, when the European
Monetary Co-operation Fund originally was established."
"Thus the idea that this 20 year old policy would be
continued in reality is not particularly newsworthy."
"Even so, gold bulls, desperate to dispel the aura of
continued central bank gold sales, are trying to promote the
attitude that this is a new and positive development," he said.
COMEX May silver ended down 5.30 cents an ounce at $6.237,
after trading a $6.290-$6.205 intraday range. Total COMEX
silver volume was estimated at a light 8,000 lots.
In the bullion market, spot silver ended quoted $6.26/29 an
ounce, compared to the London Friday fix at $6.2750 and the New
York close Thursday around $6.31/34.
But silver's forward price curve remains in its most
persistent backwardation since 1980, even though prices have
been drifting back from nine year highs at $7.90 seen in early
February on news of a 129.7 million ounce silver purchase by US
billionaire Warren Buffett.
NYMEX July platinum closed up 90 cents at $409.60, while
NYMEX June palladium ended up 45 cents at $277.10.
Spot palladium prices soared to new 18 year highs earlier
this week around $349.00 an ounce, as the market continued to
tighten in the absence of Russian PGM exports since December.
News in the past week that Russian President Yeltsin and
Acting Prime Minister Kiriyenko had signed new export quotas
prompted some profit taking. but no metal had yet been exported
and further delays of weeks or even months were still possible,
analysts said.
One month lease rates for palladium edged higher again
Friday to around 90 percent per annum.
"We're not seeing much customer business in the lease
market at these levels," said one US refining house dealer.
"It appears to be mostly PGM dealers caught short and
refusing to roll the leases that are driving up lease rates,"
he said.

(Fri Apr 17 1998 22:00 - ID#254112)
@mozel,Aragorn,All: After the first couple of dishonest goldsmiths
got hung, lets put us into the position of the members of the goldsmith guild in Europe and see how we can legalize our new found money machine: the fractional reserve banking. We brainstorm with our lawyers and we find a solution: in the future we guarantee the exchange of every one ounce certificate into one ounce gold. We form a cartell and we guarantee it. Now, nobody can hang us anymore if there is not a one to one relationship between the number of certificates out there and and the number of ounces of gold in our well guarded cellars.

Mozel, I agree with your moral judgement. But I think as long as we do not really understand the power implication of fiat money created by private bankers, and the mechanism in detail how they take advantage of it, we volutarily don't take up an intellectual weapon of great importance.

Fiat money is defined as paper money decreed legal tender, not backed by gold or silver. This is the highest level of power expansion once you put the legal or pseudo-legal monopoly right to create this type of money into private hands, hidden from public control, not understood by the public.

It is obvious that the history of fractional reserve money is extremely profitable for those bankers who issue 2,000 gold ounce certificates and hold only 1,000 ounces in their cellar. O.K., thats how bankers learned the magic of money creation.

Money creation is discussed here as if it is done only for the interest or for other secondary benefits. This is not true.

The equivalent of the $5.5 trillion dollars federal debt did not disappear in a black hole! It got into the hands of a handfull private bankers, and we all do not understand the details of how that happened.

Why would the bankers have fought so hard to get to this triumph of fiat money creation in their own hands? If this is not the highest form of magic profit for them, why wouldn't they have remained happy with fractional resrve banking? Nobody should think they suddenly became altruistic and would sell the T-bills to dump the proceeds into a black hole just to reduce the currency in circulation. They get it into their hands, but how????

The drive to fiat money is the highest triumph of irrationality but it has a simple, rational explanation. And once we find out how they do it we will see that it is simple.

My offer stands: a reward of honor ( one tenth of an ounce American golden eagle ) for the person who finds the explanation.
( How do the proceeds resulting from the sale of T-notes by the New York FED Bank end up in the private hands of international bankers? )

Alberich the Dwarf

Gianni Dioro__A
(Fri Apr 17 1998 22:01 - ID#384350)
DA, monetizing the debt
Okay, so like the Treasury says something like all Federal Reserve Notes are no longer legal and tender, and it issues Treasury Notes, which are like Treasury Bills but don't pay interest. To be fair they will allow the exchange of FRN's in circulation for new Treasury Notes. It will just print as many notes as it takes to buy back its debt. Makes sense to me.

But if these Treasury notes just replace Fed notes, 1 for 1, how is that inflationary? The price of bread should stay the same. Just no more interest payments to the central bank ( Fed ) .

(Fri Apr 17 1998 22:08 - ID#413195)
in sack-o-tomatoes
Hi, EB!: I left Sack-o-Tomatoes for the World-o-Hurt, because while at the gym in October, I suffered a herniated disk ( originally misdiagnosed as a torn piriformis, for those of you who have been in email contact with me ) shortly after achieving my all-time personal best on the bench press. I was on crutches for four months, and am just now getting to the point where I can sit for more than a few minutes at a time.

So I haven't been doing much at the computer, but have managed to keep my gold longs going -- sorry to say. Looking forward to getting back to the gym and spending more time at Kitco as I did in the good old days -- when I was really losing money. :- )

Where DID you get "...AWAY...?" The only person I can think of is the Lone Ranger.

(Fri Apr 17 1998 22:10 - ID#257136)
Your 13:04 post is reminiscent of the activities of many during the middle and late 70s and as far as I know, is still prevalent .

The National Tax Strike, headquartered in Denver had many adherents. Your posts, while more educational than were the writings of those days, are truly reminiscent of them. Many good men whom I once knew are gone to their reward.
Not all from natural causes. One in particular, Gordon Kahl, was murdered by the folks who now are definitely in the ascendancy.
I became acquainted with him here in Mena, Arkansas.
His demise was a harbinger of the Waco endemic. It has only begun. I know there are many who will read this and have a conniption, but I can only say T.S.
The new web page some one, I believe robnoel, referred us to-The Partisan- is, unless I miss my guess, sponsored by a group in Denver, some of whom I have known for more than a quarter century.
It takes either a noncaring attitude or a superb amount of cojones for one to post as you do!!
Keep up the good work.

Ol' Johnny Gold is O.K. too. Gianni de Oro, that is!

Steve in TO__A
(Fri Apr 17 1998 22:17 - ID#287337)
AJ - Do you
really live in Mena, Ark.? The place where all the shenanigans were going on!?

I've heard the Company has shifted operations to other places. Is that true?

- Steve

(Fri Apr 17 1998 22:23 - ID#26669)
Contrary comment from a friend who's in the stock market. What does it mean?
A friend of mine who's has been averaging close to $100,000 a month paper profit in the stock market this last quarter walked up to me at work, knowing I'm a goldbug. He whispered "Gold is completely dead in the water. Nobody in their right mind will buy gold. So now is the time to buy it, don't you think?" He walked off before I could find out if he was kidding. Was he just pulling my leg?

(Fri Apr 17 1998 22:26 - ID#373403)

(Fri Apr 17 1998 22:28 - ID#257136)
Spud Master's post of 14:50!
Don't forget the fact we became party to the genocide convention as it was approved by congress.
This means that as soon as they feel secure in doing it, the powers that be can use U.N. troops from perhaps mongolia to straighten out any group of citizens whom the powers care to paint as being guilty of genocide via the "Hate Thought" crime route.
Why else lay such a pervasive groundwork and spend so much effort on a seemingly innocuous pursuit?

Methinks ya hit the nail on the head!

(Fri Apr 17 1998 22:28 - ID#25253)
1 Corinthians 2 14 The unspriritual man does not receive the gifts of the Spirit of God, for they are folly to him, and he is not able to understand them because they are spiritually discerned.

I want to share my first experance with discernment. I was going fishing with a couple frinds. On the way to the lake I told them my wife has been really mad at me. She says in the middle of the night I reach over and play with her butt in my sleep. I sayed no more about it.

Five hours latter were at our room, three guys two beds. They thru there bags on one bed and said I could have the bed to myself. I discern Gold up Dow down.

(Fri Apr 17 1998 22:28 - ID#256326)
Yours is the post of the day for defining the essential dilemma of contrarian investing.........LOL!

(Fri Apr 17 1998 22:31 - ID#373403)
If we really only have 30 years worth of oil left, don't you think it's about time to start panicking? Maybe in 15 years gold will go to $60,000/oz.

(Fri Apr 17 1998 22:34 - ID#373403)
Fresh lamb
is alot like gold except it's not shiny and it tastes really good. Especially after a couple of hard earned beers.

I think I'll stop posting now.


(Fri Apr 17 1998 22:44 - ID#401237)
JESUS FREAK (Discernment)

It has been a long week and I am very tired; so please forgive me if I am missing something -BUT
What in the H are you talking about?


(Fri Apr 17 1998 22:50 - ID#257136)
A El Estudio "ERE".
Una mentirits es una mentira poco. Pero la idea de una Cuba Libre es una mentira GRANDE.
Mentirita is a small lie. But, the thought or idea of cuba being free is a BIG lie.

Culo is anus.
Codos y culos = elbows and a!!h!!es!
"sta bueno para ahora.
BTW OUZO is Greek!

(Fri Apr 17 1998 22:56 - ID#45173)
@themissinglink: dude, predictions about running out of oil are
over 20 years old. We're supposed to be out of it by now, according to the MIT group that did the first research in the 1970's ( I forget the group's name. "Running out oil" really means not getting it out of the ground and selling it at a high reasonable net profit. With the price at $12 a barrel, high-cost oil reserves like those in Texas went off the market. We're really in trouble when it takes more energy to get oil out of the ground than the energy in the oil itself. But oil companies seem to keep finding more oil and finding ways to get it out of the ground more efficiently. It's still amazing to me that I could buy 10 barrels of precious oil with as many dollars as it costs me for dinner and a movie with my wife. Ok, and maybe a couple of drinks, too. Dollars backed with... $5.5T of debt and a dubious promise of future repayment? Amazing that oil producers put up with it. Can't get their sh*t together, I guess.

(Fri Apr 17 1998 23:00 - ID#257136)
To mSteve in TO. Yep, there are folks who actually live here. Take a gander at this page and follow
the associated links and you can get an idea what it's like here and now.

As to the Co., if'n ah new, and ah don', ah wudn't tock!

If you have seen the "Mena Connection" or the "Clinton Chronicles" you've seen one of the major investigators of the clinton scheme whic are focused on in the videos.
My email is on the web page connected with the links. a.j., etc.
If you want me to say more.
It don't concern gold or silver directly.

(Fri Apr 17 1998 23:04 - ID#190411)
@sharefin about RJ
True, what you said. I have stated that I am fully invested in golds and physical.
I did nearly all of that prior to running on to Kitco.
Mr. RJ put a bungee cord on my ass and helped me from breaking my neck.
A seasoned trader is what many of us need to calm the ideological manias. F*'s points are well taken, but, methinks he rode the bear to his hibernation. I did the IDCIBM, and it hasn't been too far off. But, producers of THE MONEY OF THE FUTURE might just be a better bet. I await the expertise of the kitcoites.

(Fri Apr 17 1998 23:08 - ID#257136)
ALL: Did I commit a faux passe in posting the links for steve in TO? If so, My apologies to Bart.
Steve in TO, to get them, just email me !

Sorry 'bout that! Guess there has been a restriction put on and I either didn't read it or forgot it!

(Fri Apr 17 1998 23:14 - ID#228128)
How crazy can it get?
This evening on the radio and on the television I watched and heard parts of Pres. Clinton's address to the Chilean Parliment. He congratulated them on their brave and bold steps towards democracy. It seemed in a rather patronizing way, I might add. Sort of an atta boy, keep up the good work and maybe you can be like us. A couple of weeks ago he was in Africa apologizing for slavery to people whose ancestors participated in the process and on a continent where its still practiced. This week he's talking democracy to the very people who are struggling to obtain it as a result of the dictatorship of Pinochet who the U.S government via the CIA installed in power.

(Fri Apr 17 1998 23:30 - ID#316193)
G. Ure's Predictions For The Dow - Realistic - Not Pretty

(Fri Apr 17 1998 23:36 - ID#45173)
@IDT: yes, but there weren't Democrat's in office when
the U.S. was backing Pinochet, so Clinton is indirectly slamming Republicans. Also doing his child-of-alcoholic-parents-it's-all-my-fault-I'm-a-good-guy-see-how-sincere-I-am act.

I just got back from a 2 day road trip to visit 3 really big corps in the US to sell them software that helps them solve the Y2K problem. Want to hear the crazy things I found out?

(Fri Apr 17 1998 23:38 - ID#257136)
Steve in TO> To possibly correct my earlier mistake!

This is for informative purposes only.

(Fri Apr 17 1998 23:42 - ID#31868)
The American is a terrorist, the Israeli, the Palestinian, the Serb, the Nigerian, the Thai, the Australian, the South African, black and white, ( lets call a marshmallow a marshmallow if we are going to call a spade a spade. ) need I go on...slaughtering the innocent is terrorism. Hypocrisy is terrorism, swearing to an oath and not living up to it is terrorism.

The birth of death is a natural occurrence it is healthy. Creating an atmosphere wherein that natural path is obviated via politics is an act, which I consider one of the most iniquitous.

Now my friend let us lay to rest the generalizations which are the graveyard of the above comments.

These dirtbags in the District of Columbia who feel empowered to rob the states of their rights are to be disdained. Spit upon in public and destroyed in any battle whether it be in a court of law or the battle which waters the tree one of our Founders depicted so clearly in a message from long ago.

Mozel, my friend, just because some muscle bound kid stands at the door, with guns, means nothing. These kids know nothing of anger. My Father ingrained the horrors of Europe in me. The rest was given to me through natural selection, adrenaline, pulling my own tooth out and telling tough guys to stop whining we had a ways to git. Mozel, most of the today response team of police is made up of large, immediate response team bipeds, no more, no less. Take them into the forest ( choose your definition of forest ) , they breathe hard and make easy targets for chipmunks for goodness sakessheesh. That and the fact that I know these kids will never fire upon their own

I will never, Sir, ever, give in to these dirtbags. America, Sir, is not a country, it is most respectfully, a concept for all to live free, in the manner in which they choose unto themselves and their ways.

Central anything should be put to death like the cancer that it is.

I would gleefully join into the repair of SE Asia, Japan, anywhere in the world to set things proper on a truly golden, this for this, not that for that standard of excellence, of course you know I want to say hello to the murderer of the students in the T-Square, oh buddy!!!

And the most delicious, Camdesuss, oh, I have an aldente chubby for that dirtbag!!!

Peace, freedom to let your children look into your eyes for the answers and your ability to allow them to teach you more when they grow like all children must

(Fri Apr 17 1998 23:53 - ID#267298)
I'm beginning to believe that you don't think too highly
of Mr. Cmdesuss. Could I possibly be correct ?

Go Get him, Tolerant1

GO Gold

(Fri Apr 17 1998 23:53 - ID#344308)


your line remains've been given the chance
to take it back...get on with it.

(Fri Apr 17 1998 23:57 - ID#227238)
The tax season is over. A lovely weekend is at hand and your government would like to take this opportunity to thank all of you for your exemplary behavior during this trying period just past. As you all know, YOUR government works very hard to maintain the illusion that OUR tax system in the United States of America maintains itself by virtue of VOLUNTARY compliance. No other nation on the face of the earth can make that lofty claim.

In all too many nations, noncompliance with the legally constituted tax authorities is an ongoing problem. In Russia for example, the government is forced to go hat in hand to international lending agencies for the cash to cover day to day operations. A truly sorry spectacle and very low commentary on the state of relations between the Russian taxpayer and his government. Don't you agree?

Imagine how we all might feel in international company, knowing that our citizens care so little about their duty to their masters as to fail to, voluntarily, pay all taxes due them.

Don't you get a warm glow in your heart whenever you read such a report and realize that but for existence of our duly constituted, voluntary tax system, we would likely face the same embarrassment. I know that our masters do. And they retire each evening thanking Almighty God for such.

Fortunately we are not forced to suffer the same ignominy in the United States. A nation that has daily need to appear faultless as a shining example of democracy in an otherwise troubled and miscast world. And it's only possible because our masters have chosen a system that rewards voluntary behavior. It does so by allowing the VOLUNTEER to temporarily maintain remaining assets, at volunteer's expense, until such time as our masters find need of them. Of course it's only natural that in cases of dispute, the master's need's take precedence over the supplicant. That is only natural. Don't you agree? And so it is, as it should be, in a well ordered and voluntary world.

This system is the envy of other masters in other nations, all over the world. Predicated, as it is, on the notion of VOLUNTARY COMPLIANCE. A system that could not function, were it not for the BIG HEARTS and boundless magnanimity of the American people. A sense of civic pride and duty to the state that truly brings tears to the eye, if you ( can ) think about it.

So as another tax season comes to a fruitful and binding close, your masters would like you to know how much they appreciate the many, who voluntarily signed their tax forms and by so doing relinquished all rights to protection under the 5th Amendment. It is but a trifle and of no consequence when measured by the importance of maintaining the illusion of VOLUNTARY COMPLIANCE. Has a nice ring to it. Doesn't it? Just knowing that it's not just money you're giving but a constitutional right as well. How much more to prove love and devotion to the masters?

Feel free to now pursue those things that are not bounded by extra constitutional authority. Consumption is good. Hoarding is bad. Those misguided individuals who choose to hurt their fellows and their nation, by storing resources outside the banking and monetary system are strongly urged to reconsider doing so. It is only by keeping the product of our labor in continuous circulation that this great nation and its masters can continue to fluorish.

So fellow citizens, consume much. Prepare now, to volunteer again next year and for those whose health is somewhat suspect, please plan ahead for a speedy demise. There are many depending upon an already overburdened system. It would be an example of poor citizenship, to unduly stress the system, by wasting resources better left for the more deserving.