NEW YORK ( AP ) -- As the year ends, American consumers are spending practically everything that's left over after the government takes its cut of their paychecks. Based on the latest official figures, that would mean 99.9 percent of take-home pay, a spending rate never before witnessed for any length of time. And who knows, easy credit might push it over 100 percent. It poses questions: Why do retailers feel they aren't getting their share of the spending, and how long can this fevered behavior last until spenders declare they've had enough fun and stuff and need a rest? But most curious of all, with government talking about cutting and saving and businesses downsizing, why are consumers exhibiting such behavior, so contrary and out of step with the rest of the world?

http://www.newsday.com/ap/rnmpfn01.htm
--
There is a cure, 18900 people figured out what it was today.

I agree with you

ALAN Greenspan is petrified about the stock market bubble but doesn't know what to do about it. No, Greenspan isn't suddenly becoming chatty - at least not with the press. But Lawrence Lindsey, who worked alongside Greenspan at the Federal Reserve until 18 months ago, is having more luck breaking through Greenspan's mumbo jumbo.

http://nypostonline.com/business/8321.htm
--
Life is tough when you have to run the world with only three levers.

Pigs filling the pens,

children counting the days.

Long winter.



JM

oleman . . Mon, Dec 14, 7:21PM CST ( -0600 GMT )

The only fundamentals that matter are earnings and interest rates. With the "once in a lifetime" exception of deflation, rates are the most important. Technically, all that really matters are TREND and MOMENTUM. This market has lost so much momentum that there is a real possibility that the trend is now changing. There WILL be a bounce, sooner rather than later, imo, but the burden of proof is definitely on the bull. I'm glad to be flat, and will probably be positioned short before the week is out. The RUT chart is a nightmare. This site link is a picture of a wound that has always proven fatal to the bull in the past. comments?

oleman . . Mon, Dec 14, 7:25PM CST ( -0600 GMT )

mbohen: I think mama gump will be proud of you tomorrow. But dont overstay the party. Today's low will almost surely trade during rth tomorrow. I'll look for an opp't'y to buy down there at that time, for a bounce.

oleman . . Mon, Dec 14, 7:28PM CST ( -0600 GMT )

craig: I have a similar indicator, tho it is much faster. This one you have posted means death when it tops BELOW the Zero line. Mine signaled on the first top on 11/24, and I let it ride. LAst Thursday it screamed at me to dump longs. The next rally will require me to position short, barring a Klintonesque miracle: )

oleman . . Mon, Dec 14, 7:40PM CST ( -0600 GMT )

johng: The divergences can be overlooked, but the topping below ZERO has ALWAYS been a death knell. I disagree with gullly on a lot of suff ( outside the charts, just about everything: ) , but, make no mistake about it,he's right to harp on price and time. Price movement makes the TREND. Momentum changes before the trend changes. Momentum is simply the rate at which price moves thru time. I dont use the A/D stuff, per se,in making decisions. I have my own simple momentum measuring method, which i use on all time frames. Its written on my monitor, and willed to swtrtans upon my demise: ) more.....

oleman . . Mon, Dec 14, 7:44PM CST ( -0600 GMT )

The news only validates the charts, as gully says. It is unimportant what caused the "Greenspan" bar in mid Oct., the fact is that there was enoug momentum to give us a very profitable push to the upside. pj: All I can

be sure of is that the move from 10/8 is over. There aint no MO no mo: ) HOw bad things may turn is still a question. I'm just calling attention to the sickness of the patient right now. oohfaw...........

oleman . . Mon, Dec 14, 7:46PM CST ( -0600 GMT )

BTW: Today's low will almost surely trade tomorrow. Plan accordingly.............gone...............

The last time you'll see the Nikkei above 14000.

Japan 14005.32 -106.30 -0.75%

http://quote.yahoo.com/q?s=^N225&d=1d

all hope,even in the despondent state I find myself in.I am not a great tactitian.I have no tantalizing charts to offer any of you.I have no arguments that persuade anyone to buy gold or gold equties except that when a product sells for what it approximates in cost to produce,that it will rise in value or disappear.I cannot tell you when this will happen,except that I do not believe gold will disappear.

For awhile I have been deeply discouraged with my gold investments--- that those investments have not produced even modest returns.Even though in my estimation-----they should have.I have done well all of my life by making reasonable,somewhat predictable investments.I am not one of those who cries conspiracy,manipulation,foul,or blames someone else for the mistakes that I make.When I have made mistakes,the reasons for those mistakes were apparent and predictable.The risk had been calcuable ;I just made the wrong bet.Now,I defy those charts and assumptions and valuations of supply and demand to give even a foggy path for predictable outcome.

Believe me this is not a case of trying to make the market do what I think it should,and being disgruntled when it goes another way.But,I sense the manipulation of the market.I hear the lies.I see the deceit.Slowly,we are witnessing the change.I see comic strips alluding to Greenspan's manipulation of the market.I watch as brave souls risk failure for truth and conviction.I do sense a change.It has made me perkier than I have been in a long while.Gotta' love that Hyde and Graham.Gotta' love it when something this big starts movin'.

EJ-------- if it gets as bad as some predict,you might ought to get the "extra large"pen.Better yet,invest in the company which makes them.

Is up over 4%. From its low in September, it's almost doubled! What's their secret? Ignoring the IMF?

Thanks for posting Oleman's thoughts.

I haven't kept up with TVX for a long time now. I know they need money or a JV partner to get the Greek properties online.
I like their La Ciopa JV in Chile, PDG is the partner.
I like the way the JV is holding back on the silver production ( because of the lousy AG price ) from the satelite ore body 30 klicks+- distance from the mill. This body was going to produce 33 million oz. in about 13 months, before exhausion. Hope they mine the bulk after silver moves.

NEW YORK ( AP ) -- Supporters of President Clinton rallied Monday night, urging the House of Representatives not to vote for impeachment. The gathering at New York University drew two Nobel laureates and a Democratic member of the House Judiciary Committee. "Like everything else, humiliation must have its limits," said Elie Wiesel, a Holocaust survivor, author and Nobel Peace Prize winner. Most Americans oppose impeachment, he said, urging "Please, judges in the House, listen to ( the majority's ) voice." The crowd of 750, which included students and residents from around the city, cheered as speakers called for an end to the public drama begun by Clinton's affair with former White House intern Monica Lewinsky.

http://www.newsday.com/ap/rnmpne0o.htm
--
750, wow. I've been to keg parties that had more than 750 people.

http://www.drudgereport.com/matt.htm

I bought a bunch of silver balistic bullets for my .270. The price was shocking. Nothing compared to .416 Rigby Solids however...

Kind of odd. Ammo appears to have out performed all of my other investments...

They are very helpful and much appreciated

The best messages are often the shortest. Very dry. Very amusing. Probably absolutely prescient. No more rabbits to pull out of the kimono....

those stories wear thinner and thinner dont'cha think.I wonder, are others bored by them as well?

All: If the market behavior is dependent only on technical trends, and not on any earth-shaking news, I would bet that they are right about the rally regaining steam, and rising some more -- money supply, spending and interest rates.

But -- there is one very big wrench that may bring down this aging bull market -- impeachment. Anyone wondering why Hyde et all did not falter ( Unlike Rep Livingston ) when the last election was in favor of the Dems? Now Livingston is in favor of impeachment. John Crudele has said that Congress knows far more about WJC that what is public news, and he has also said that the news of what is happening behind the scenes will eventually bring the markets down. After all, it was Oldman himself that said that WJC's and the markets fortunes are linked.

So -- please look at Matt Drudge tonight.

http://www.drudgereport.com/matt.htm

Apparently there will be a bombshell article in the New York Times tomorrow about how the Communist Chinese paid the Democrats in the 96 elections to get US technology. I am paraphrasing because I don't know the details, but it looks like the 'big guns' are firing at just the right time to get the Republicans in the right mood to vote for impeachment.

I would guess that bombshells will be coming out regularly from now on. We are already at the Nixon impeachment stage, and by next Thursday ( I think ) we will be at a 130 year presidential impeachment record -- a positive vote by the House. I do not expect the Senate trial will proceed, but WJC knows already how he will go down in the history books. There are apparently sealed criminal indictments just waiting for him when he steps down from the presidency. WJC is going to act more and more defensively, and the markets are going to drop.

Good for precious, I'll bet.

I'd like to offer some some observations, and, some advice.
[flame suit on]
1 ) Regardless of whether you think Y2k is a .1 or a 9.9, I think we can all agree that we've never seen such a all-at-once-and-everywhere systemic threat before. ( Note, I said *threat* and not fact )
2 ) Whether you are *right* or *wrong* on this issue seems to me to matter little, except perhaps in your own mind. I am very involved in the issues, but still am emotionally about a 1.5 and intellectually about a 7.5. So, I can easily argue both sides of the case.
3 ) So, why not prepare? Just in case? It's not a bad strategy, is it? If Y2k is a .1, then you are all stocked up for a year, or 3 months, or whatever your preparations will allow, and you are not hurt in the least.
4 ) Granted, the money you will have to lay out now won't be earning you interest, but with interest rates as they are, does it really matter all that much? Besides, the "volume discount" you might get might offset the bottom-line cost.
5 ) But, if Y2k *is* serious, then you will have taken preparations to take care of yourself, and not be a burden on others. Someone posted back a while "Community preparedness is for those who did no personal preparedness". I'd rather be personally prepared, to the extent possible.
My Belief is that in the year to come, if as many people as possible prepare as much as they can, it will soften the impact ( if it is serious ) , and will certainly provide some peace of mind in a world which is likely to go a bit nuts, if even 1/2 is true ( Ala Cowgirl's post ) .
-cg
P.S. Only 9,168 real hours left until 1/1/2000. @Sorex, I'm counting the *hours* here, not the days!

esoterocist
Forgive my imperfect memory, are you able to assist friends of mine to buy gold in Bangkok? Please email me.

all
help please with composition of
white gold
Rose gold

and, a real curly one

"khaam dam" which my freinds tell me is "black gold" and, apparently needed in space technology...

9/27/97, on kitco.com investor discussion board:

'...When the tent collapses,
it will not be the center post that goes first;
but the side posts,
and even the stakes...'

Proposal:

An Educational Series ( for PBS, & other media sources ) on:

What is - 'MONEY' ?

Numerous countries' currencies, markets, & economies
have dropped, even collapsed....
in the last few years.

Why?

WHAT IS THE ROOT CAUSE OF THIS MALAISE, THIS AFFLICTION & CONTAGION ?

What is 'money' ?
What is the value & meaning of a nation's currency, and money ?

How does money, and a nation's currency,
relate to the global economy....
and the international monetary & economic uncertainty,
that are apparent today ?
What is meant by - 'the Asian Contagion' ?

Are we, indeed, at a millenium turning-point ?
What is happening ?
Are we, collectively, globally .....- at a major, fundamental -
turning-pont ... for all of humanity ?

Is Russia's economic collapse related...
to what is happening, and not happening....on Wall Street ?

Is Brazil's market instability related, to the groceries we Americans bring home from our 'super' super-markets, every day ...??

WHY, in fact, is it reported that - S. Korea's middle-class,
in it's over-nite decline & desperation,
have found it necessary to - surrender their children
to state-run orphanages ...
to prevent their childrens' neglect, and even starvation? ...!
Could this be,
in any way - inversely RELATED,
to - "THE GOOD LIFE"....
in the 'good - ole' U.S.A. ....?

The only monetary, economic, financial, political, social, personal....
and international world, that will survive, and thrive, in the new
millenium;
will be a world that believes in an international community where: -...
..... "I win..... as....... YOU win."

Fiat national currencies will be replaced by a universally accepted,
international money, and monetary standard, that can be trusted, and
used, willingly, by all nations, peoples, ethnic communities....-
by the one & only..... human-race ..... all over the world.

The current, unfolding ...international -
economic turmoil & uncertainty, and burgeoning crisis ....
...... - is a symptom of, & result of -
.... an international monetary system,
that his evolved over several generations,
out of a fiat
and false
- paper dollar, a U.S. dollar as the 'reserve currency' &
international monetary unit.... -- but a pretense - for real money.

This subterfuge and transgression, perpetrated upon millions,
has been orchestrated by means of
the evolution of paper-money, gradually devoced from gold convertibility, and by numerous artificial credit instruments - that have been created out of thin air, by deficit hungry & hemorrhaging governments, and their colluding central bankers.

This monetary system of collusion, corruption, wishful thinking, and political expediency..... has been perpetrated, by various national governments, in quiet agreements with bankers and governments,
national and international.

This evolving fiat currency & credit monetary system, world-wide, has
culminated in banking and corporate interests,
of unwarranted and concentrated - wealth & power.

Now,
this inverted pyramid of fiat money & credit - debt - ....
still yet - pretending to borrow its way into prosperity...

is collapsing in - upon itself....on a world-wide scale.

A majority of the body-politic ...
of the international community - of all of human-kind...
would be well informed to understand that:

All currencies originated as a receipt for gold money.

The abandonment of this reality & truth ....
- is something most sinister...
and, it is the root cause - of the corruption of ...
the international monetary-system......

It is, in fact, the root cause of the unraveling of the
financial fabric and economic stability of the
civilized world's global economy.

Throughout this world economy - the whole fabric - of
civilization, is precariously under seige...
according to the failed policies of governments,
that would, with their government sanctioned & monopolized
central banking systems...continue to create money & credit....
out of nothing but thin air, as they have been doing,
for generations.

At this conclusion of the tumultuous 20th century,
what is called-for, is:

"A PAUL REVERE" commitment on the part of important media
sources/enterprises, in the leading free nations
of the developed world
-
to advance the education of this simple fact:

money is BOTH -
a medium of exchange,
and
A STORE OF VALUE.

Only gold convertible currency,
& gold-defined credit instruments,
have provided this dual role & purpose,
in the history of progress,
and the promise of liberty & fulfillment...
that hold within, the promise and the destiny.....
of all humanity.

Sincerely,
David Blair Macrory
goldfever@k-online.com>goldfever@k-online.com>goldfever@k-online.com
essene@k-online.com>essene@k-online.com>essene@k-online.com
P.S.S.
The corrupted, collapsing global economy, & monetary system...
we are experiencing now - are rooted in..... and rotting in.....
the fact that the U.S. dollar - once convertible,
& exchange-able for -
gold,
as the reserve currency....
and monetary-trade-unit...... of the world...
has disintegrated,
via political expediency & short-sightedness .....
into a fiat & false - U.S. paper dollar...

including - ... the artificial credit instruments
created, engineered & manipulated ... by
the fractional reserve, central-banking systems ...
of the U.S. & Europe,
in the 20th century.

I sincerely hope that PBS, as well as other important
media sources & organizations,
will willingly, courageously ...
research, publish & disseminate widely -
objective, historical research ...
that verifies, the historical fact - that -

only MONEY, which is, and must be, always, both -:
a medium of exchange...
and-
A STORE OF VALUE.....

that is rooted in gold backing & convertibility....
...
only THIS - ..... will - ultimately -
insure the foundation for the
possibility of -
economic, political, and personal freedom........ --

and the foundation of inherent promise .....for the
.....destiny of individual realization & fulfillment,
...-- the inherent birthright of
of each and every one of us - of the family of human-kind.

Sincerely,
David Blair Macrory
goldfever@k-online.com
essene@k-online.com

P.S.S.S.
The important media & educational sources & organizations -
of the nations of the free world -
have the challenge & opportunity -
to find the insight & courage to tackle -
or at least - address....
this fundamnetal, historic, at-this-millenium -- issue - of:

'WHAT IS MONEY ?'
'WHAT IS THE ASIAN CONTAGION ?'
'WHY S. KOREA'S DECLINE ?'
'WHY RUSSIA'S COLLAPSE ?'
'WHY BRAZIL'S TURMOIL ?'
'WHY U.S. MARKET & ECONOMIC UNCERTAINTY ?'

Is there a "common thread" ?

Is it .... UNRAVELLING ?
'ARE THESE RELATED ?'

?????:
money
economy
credit
debt
prosperity
poverty
liberty
servitude

In the cycles of history, and in this cycle of turning-point - now:

"what is the truth of our time ?"

Sincerely,
David Blair Macrory
San Diego
essene@k-online.com
goldfever@k-online.com
P.S.S.S:

Is Russia's economic collapse related?

Is Brazil's market instability related?

Is the U.S. stock-market volatility....... related?

Clinton can't be anymore a bad guy than Bush or Regan, his policies aren't so different. That's pretty bad tho. Terrible in fact. We just aren't clearing the world of nuclear warheads, unforgiveable. The rest is nonsense.

We do need a social policy underwhich people can eat..wether they work or not, especially children.

We need a gold standard...gold and silver are money..not printed words.

I know alot of people who post here don't agree with me on these issues, but I think maybe we agree on the most important things.

Least government..not no government.

Something serious might be coming, something not even related to money in any form. I don't think the next couple of years are going to be so comfortable..We are going to change.

Apologies for boring you, consider the flow of news stopped. : )

@aurator - checkyeremailbox : )

Neerdowell - It's not his policies per say, rather it's the unscrupulousness of his methods - which he and his manipulative wife seem to be able to justify with sophistry, semantics and legalistic backflips that Dominique Moceanu would be proud of. ( on topic ? )

I conclude whilst the witch-hunt is an ugly thing to watch, perpetrated by a bunch of hypocritical vindictive old men, it's what they've been forced to resort to, in order to try and get rid of him before some really nasty sh#t comes out. There's a lot of really dirty linen to be washed. WHihc will taint both sides of the house possibly.

This sex thing is of course just a proxy - one which necessarily makes the Republicans appear mena-spirited ( something upon which WJC's spin doctors have been counting ) . All of which is NOT THE POINT entirely.

This is going to get very NASTY. He knows the math in the Senate. They know of a whole disgusting litany of facts that will destroy MANY POLITICAL reputations. A case of Political M.A.D. ( mutually Assured Destruction ) is my guess. ULtimately inevitable though.

And yes, the markets ought to tank as the truth reveals itself.

Altogether now, Gold Gold Gold Gold. Dumdeedumdeedumndeedum !

I respectfully disagree.

Y2K will not strike on any particular date, but will be spread
out over the next 18 months. Y2K problems are already occurring.
Testing will bring out Y2K failures at random times. There are
many different dates that are failure points. Different fiscal
years. Some problems will be fixed quickly, some will not. Some
will occur 3, 6, 9 or 12 months into the future.

The world *has* seen a similar situation. Any of the depressions.
The whole argument of the "supply chain" failure causing
systemic failure is the SAME model. The U.S. economy
collapsed over a three-year period. Do you believe that
the "supply chain" was not disrupted then?

I'll agree with CompGeek's argument of preparation. I don't
fear Y2K. I fear that Y2K will be the catalyst that finally
overwhelms the Rube-Greenspan contraption that has been holding
the whole house of cars together for the past eight years.

The only reason that WJC problems began with Monica is that sex is the only thing that he cannot have his subordinates do for him, except perhaps drugs. The other issues are just lagging a bit and will surface soon.

Well, I posted it about a month ago. Looking at the interest
rate inversion in the UK, England looks like it is going to
flame on big. Grabbe's page has a new article - Manufacturers'
Prices Fall at Sharpest Rate in 40 years in the U.K.

Judging solely on the amount of inversion, the UK, Italy and
Canada get hammered pretty bad. The U.S. and Germany look
pretty good in relation. Japan's interest rates are so
messed up I wouldn't venture any kind of guess.

esoterocist
Thanks for the mail, check under your ouija board :-^ )


Now, my friend, living in Laos has been telling me an interesting tail about

"khaam dam" or "black gold" that is apparently needed in space technology...

Please don't flame me, becuase this is all hearsay, but, this "black gold" has a couple of very special tests:
One test, light two candles, one on each side of a piece of black gold, the two candle flames will draw into each other.

Another test: If you hold a piece of black gold near a car ignition, the car will not start.

There are other test, which if the goddesses of memory are kind, will occur to my friend before he departs NZ.

It is supposed to be sold, on the quiet to the USA for, brace yourselves, several million dollars per ( ounce/pound? )

legislation on Wed. If the opposition once again successfully votes down a significant amount of the proposed budget cuts, the mkt will blow up.
The impeachment proceedings have unnerved many investors, but Brazil will determine the mkts fate. Credit spreads have once again widened & AG is on the verge of losing control of an impending financial disaster.

From Matt Drudge on CLinton's options
1 ) Go before a national television audience on Wednesday night to
once again apologize to the nation. This time, Clinton would use the
speech as a total "confessional." He would admit to "lying" and would
confess, and describe in greater detail, the covering up of his
affair with Monica Lewinsky.

2 ) First Lady Hillary Clinton would give an emotional plea on
television and ask Americans to forgive her husband.

OF COURSE - get Hillary out there - tears in eyes standing behind her man.

Hey gold up $! in London why its a rally!!!!!!!!!!!!!!!

Hyuk hyuk hyuk... this is rich. So the "Lying King" decides that
he can finally say 'OK so I lied on the stand! I admit it already!'
and then everybody will forgive and forget. No doubt he'll throw in a
few attacks against Tripp, Starr, etc. And he'll also probably
suggest that he still didn't commit purjury. Suuuuuuure he didn't.

I've looked at some cases of people who lied on the stand but did
not commit purjury. In every case it was something utterly immaterial.
E.g., a witness omits an embarassing aspect of a testimony that truly
does not effect the outcome of the case. But to lie about sex, in
a trial concerning sex, is clearly purjurious.

He's gonna be impeached. Wait and watch, it's comin' down the pike
this Thursday.

~Silas~

The stock market is rallying on the Globex, perhaps just back to the break down point of 1150 on the S&P - will give you bears that.

While Brazil looks like a time bomb the dollar is stronger....quite a bit stronger...

Meanwhile the price of gold is holding on to a $1+ rally.

Getting the feeling there are no correlations between the dollar, gold, the stock market.???

Checked under the INDOX pillow and found the tooth you left me...

Funny - I've been researching LAOS as I might get relocated there....that would be interesting...

When in back up int he the "Big Mango" I shall check further into this story with "people who know". I have to go next week. And will leave the investigation to my friend's ( Thai/Mon ) wife who knows how to find out such esoterica. Hold tight.

Gold in Thai is "Thong", but Dam certainly means Black. As in 'Jai Dam" which means nasty or "Black hearted".

Contrary to the mood of the American people at large who prefer the whole thing go away and there not be further disturbance to their fantesies, I see the only course that is consistant with the responsibilites of the president and congress being to impeach. HE LIED UNDER OATH!! He tired to obstruct justice!! And I bet that's just the tip of the ice berg.

I keep thinking that he will resign in time to provide for a braod pardon from Core. The republicans will not come out of this a winner -but that is not the point - if the Presidient can lie under oath and get away with a hand slap and a pardon - what does that say to the average person - rather the average criminal....

I suspect somehow he will get off with less than impeachment and we go on to be thougth of by the left as the hero of the disadvantaged who was done wrong by the republicans who will be blamed for the falling economy.

I read elsewhere that if the house votes articles of impeachemnt then CLinton can not be pardoned - is that correct????

James, I agree - Clinton will get the attention but worse problems are erupting - the question is will gold and gold shares provide any safety.?? Opinion here is that they will - the record to date is poor. If AG looses control - then we have a different picture. I am becoing more of the mind that the gold rally is not here yet, obviously, or about to start, and won't until there is a real jolt to the financial frame work....frankly, I'm in no hurry for that to happen - I can't hedge my full well being under the current system with enough of what may be of value in the next - but I'll do my best.....false rallies I'm tired of following.

Roger Clinton loses 'Doggie-gate' case

Copyright  1998 Nando Media
Copyright  1998 Reuters News Service

LOS ANGELES ( December 14, 1998 9:58 p.m. EST http://www.nandotimes.com ) - "Doggie-gate" is over. President Clinton's half-brother Roger lost his day in court Monday when a jury ordered him to pay $1,285.10 to a man bitten in a dogfight between his and Clinton's pooches.

Tree-trimmer Jeff Klempan said the fight was all Clinton's dog's fault because it ran out of its master's house and attacked his dog while it was on a leash.

Klempan, nipped while trying break up the fight, sought compensation for medical bills, lost wages, pain and suffering.

The jury threw out a $300,000 countersuit by Clinton, who claimed he had suffered mental anguish from watching the two dogs scrapping.

Klempan's lawyer accused Clinton of trying to turn the dogfight into "doggie-gate" by refusing to reach an out-of-court settlement.

scheme. It epitomizes the excessses & outright fraud that has been perpetrated in the inflation of this stock mkt bubble:

Dec 12, 98: Parish & Company Provides Details of Financial Pyramid at Microsoft and Cisco Systems in Open Letter to Robert Parry, President of the Federal Reserve Bank of San Francisco.
PORTLAND, OR - It was a pleasure meeting you at the breakfast in Portland on Friday December 4th and congratulations on your success at the Federal Reserve.

The question I asked you during the televised broadcast was, as you noted, rather technical in nature. I apologize for that and please do allow me to summarize the question again in the hope that you might engage your research staff to explore this area which appears to have created a $1 trillion financial pyramid within a narrow sector of the equity market, not unlike the debt pyramid created by the Long-term Capital hedge fund. More details are available at www.billparish.com

The question was the following: In October, Arthur Levittt, Chairman of the SEC, announced a major initiative designed to improve corporate accounting practices, including the non recognition of significant liabilities such as employee stock option programs. In the initiative he noted that reality was giving way to illusion. Could you please comment briefly on your relationship with the SEC and whether you will become involved in reviewing this issue?

In your response you referred to the Long-Term Capital hedge fund as one example of such involvement and highlighted the importance of investor confidence in the markets. You also noted that it is important for the Federal Reserve to maintain a strong focus on its own specific objectives.

Responding to another unrelated question pertaining to the Japanese banking situation, you mentioned that many of these bad loans probably need to be written off the books. Of course in Japan a major contributor to their situation was also a breakdown in accounting practices. Many expenses, rather than being charged to income, were set up as assets to be amortized in future years. Assets became inflated, loans made against those inflated assets and when the bubble burst it was discovered that there was no economic value to repay the loans.

Here in the US their was a bitter struggle between the accounting and investment communities regarding one controversial accounting practice that has led to this $1 trillion asset bubble that could seriously threaten the stability of the financial markets. This practice involves how to disclose and account for stock option commitments and, like the Long-Term Capital investment strategies, is based upon a math model designed by Myron Scholes. This is the Black Scholes option pricing model.

Stock option programs can be an excellent incentive yet they are now being used in a classic pyramid style structure, most notably at Microsoft and Cisco Systems, in which employees are prepaying their own future wages and being left with potentially inflated shares. Here is how it works using Microsoft as an example. Tables, charts and more background are available at www.billparish.com

When employees exercise stock options they must pay tax immediately. For example, if Sue pays an exercise price of $20 and get a share worth $100, she must pay tax on the gain of $80. Interestingly, the tax is not going to the IRS. This is because the company takes a tax deduction for compensation expense for the same amount. To the IRS it is a wash. Simply put, the tax goes right back to the company in the form of increased cash due to paying less tax.

Since 1995 Microsoft has claimed $10 billion in compensation expense on options exercised by employees yet due to a major accounting loophole, this expense is not reflected on the income statement, which greatly inflates earnings and makes their results non comparable with other companies, introducing a major market inefficiency.

In addition to the distortion of past earnings, Microsoft as of December 12, 1998 has a future liability of almost $55 billion in stock option commitments, half of which are now exercisable. This is a real liability, what their CFO has publicly referred to as their most important liability, yet there is no recognition of this liability on the income statement or balance sheet. The Black Scholes model is a footnote only disclosure based upon solid theoretical assumptions yet it does not recognize the practical financial reality.

With approximately $40 billion in gains to be recognized based upon the $55 billion commitment outstanding to employees, Microsoft knows that it will be able to create cash of almost $14 billion as these options are exercised. In addition, they know that for every $1 increase in the stock price, 35 percent of that increase is cash in the bank.

When compared to the company's gross annual sales of $18 billion, one must wonder if there has been a breakdown in accounting practices, as Arthur Levitt notes. These inflated earnings of course fuel the stock price, especially as earnings slow in other sectors. Microsoft is now the most widely held and highest market capitalized stock in the country.

Many other companies, although they also use this model, manage their programs well to ensure that the overall company finances remain solid. Two examples are Hewlett Packard and Sun Microsystems per a review of SEC 10K reports. In both cases their stock option commitments do not exceed more than 10 percent of gross sales.

My concern is that unless you work with the SEC and achieve reform or at least publicly disclose these practices, simply lowering rates will further fuel the pyramid, narrow the equity markets and risk destabilizing the overall financial structure.

My projections, based upon SEC filings, indicate that in 1999 almost 50 percent of Microsoft's entire operating expenses will be financed through the exercise of employee stock options. Your staff might conclude a higher percent. Employees are clearly prepaying their own wages in a classic financial pyramid.

More alarming is that in the most recent quarter Microsoft earned $225 million selling put contracts on its own stock. Of course they are convinced the stock will not decline and realize that index based mutual funds are required to buy the stock. If Microsoft makes up 4 percent of the S&P 500 Index, then all mutual funds based upon the S&P 500 are required to dedicate 4 percent of all new cash received to Microsoft.

Meanwhile, the Department of Justice is aggressively pursuing its case against Microsoft, claiming a monopoly. Frankly, I have never met a Microsoft employee that I did not respect for their passion, commitment and ability. They are extraordinary yet should their management have the unchecked ability to construct such a financial pyramid, not fully disclose these practices to employees and also potentially destabilize the equity markets?

It is also noteworthy that 401K balances are the primary cash source for new equity investments. One might ask if the average company looks at their 401K retirement plan as a mutual savings bank which holds their employee's life savings or is it looked at as just another benefit? To date, these plans are loosely regulated, generally do not have adequate independent oversight and are actually starting to look much the like the Savings and Loan banks of the 1980's before they began failing.

A second accounting practice aggressively used by Cisco Systems, no longer used by Microsoft, is the pooling method to account for acquisitions. This further fuels the pyramid and is separate discussion.

If this sounds a little far fetched please do ask the banking CEO sitting on your left at the breakfast regarding the integrity of my work.

For good background information please refer to the 9/30/98 also available at www.billparish.com which furthur explains underlying mechanics of this pyramid that resulted in a leading British paper, the Independent, running a editorial on the subject and also declaring Microsoft a financial pyramid. Please do let me know if you would like any additional information. Here in the United States we often take for granted what an extraordinary advantage we have via the good work of the Federal Reserve and SEC. Thank you for your efforts and best regards.

Sincerely,
Bill Parish
www.billparish.com

http://www.nando.net/newsroom/ntn/nation/121598/nation40_26860.html

Keep the flow coming...it's never boring.

: )

For Monday 14th Dec calculated from data published in Today's FT.
Period------------1- month--------3-month--------6- month---------12- month
$LIBOR-------------5.53--------------5.22-------------5.06-----------------4.97

Mean GoldLR------4.13---------------4.06-------------3.77-----------------3.54
Gold Lease Rate---1.40---------------1.16-------------1.29-----------------1.43
( Change ) ------ ( + 0.06 ) ------- ( + 0.03 ) ------- ( - 0.01 ) ----------- ( - 0.02 )

Silver Lend Rate----4.00--------------3.25-------------2.40-----------------2.00
Silver Lease Rate---1.53--------------1.97--------------2.66-----------------2.97
( Change ) --------- ( - 0.06 ) -------- ( - 0.08 ) --------- ( - 0.08 ) ------------ ( - 0.03 )
$LIBOR = BBA London rate fixed at 11am
Mean Gold Lending Rates and Silver Lending Rates are supplied to the FT by NM Rothschild
Lease Rate = $LIBOR minus Lending Rate .
( Change ) = change in lease rates since previous day

For comparison with $LIBOR, the FT rates for US Dollar CD's ( mid rates ) are as follows:
Period------------1- month--------3-month--------6- month---------12- month
US$ CD's-----------4.82-------------4.74---------------4.72---------------4.68
Regards.............Dabchick

esoterocist
Many thanks. Incidentally "khaam dam" is Lao, rather than Thai, and "khaam dam" is the best rendition into our alphabet we can manage.
It is supposed to be 'found' near the border of Laos and Vietnam in Sepon district..


kap koon mahk khrap

http://www.cairns.net.au/~sharefin/Markets/Swing.jpg

New web pages - head down butt up...^o-o^
Alternative links
http://www.cairns.net.au/~sharefin/Markets/Alternative.htm
Year 2000 links
http://www.cairns.net.au/~sharefin/Markets/Y2k.htm

Lots quicker now.

I have bookmarked your new pages. Lately I find I use your site more often than sites like HotBot, Yahoo and Altavista. Thanks for having such a site.

OK I'm impressed - And armed with your info will track this story down...Mmmm ?

Khun rien Passa Thai teenai krup ? ; )

my chai phom tee poot pasaa Thai dy khrap, pen peuan sanit korng phom tee ma yiam yarm phom.

http://biz.yahoo.com/rf/981215/dy.html

Peun Khun narak mai ? Sao swey swey, Oh Oh douey mai ? : )

http://biz.yahoo.com/rf/981214/bgs.html

Have to take that as a bullish signal??

http://nt.excite.com/news/r/981215/00/business-hedgefund

Seems there is something to Bill Murphy's thesis that while the central bank ( THE CABAL ) orchestrate sales programs when gold gets to $300 the Asian buy at $290. The metals are moving higher along with a stronger dollar and stronger equity markets - perhaps indeed we are just in a trading range between two strong forces.

What exactly does Nastrovya mean? Thanks ;- )

Thanks
cpo

Cheers, prost, salute, Salum ati
perhaps i could ask at this time namaste is that also cheers
cpo

http://cbs.marketwatch.com/news/current/baz.htx?source=htx/http2_mw

Please forgive me for the post last nite.After having read it over again, in light of your response,I saw how it could have double meanings.What I was referring to was the propaganda machine of the present administration,Rivera,some reporters who I am certain are employed by this administration,and many others who at all costs want Clinton to remain.I was referring to the fact that like the administrations ability to bob and weave ,those types of news stories are less and less effective or believeable.The magic isn't working like it used to.

Do not,please,stop posting your news.I find much of it informing and useful.No ill will or unkind words for you, here, my friend.

Go to Orlin Grabbe's site or to the Fin. Times. Deflation is spreading to the UK.

Gold is going to have a hard time going up unless some political panic overtakes the deflationary forces holding it down.

- Steve

Tried K-2 they asked for password I used this one and it was rejected. Are they going to cut off the fun over there? I hope not.

Or it is babble?

Go gold!

Investors take dim view of Placer deal for Getchell

Tuesday, December 15, 1998
PETER KENNEDYBritish Columbia Bureau Vancouver -- Placer Dome Inc. shares fell 14 per cent yesterday as investors took a closer look at the company's $1.1-billion ( U.S. ) deal to buy Denver-based Getchell Gold Corp. and decided it is paying too much.In a conference call with analysts, Placer chief executive officer John Willson said he is confident his company can double production at Getchell's Turquoise Ridge and Getchell gold mines in Nevada to 800,000 ounces a year.But Placer stock fell $2.90 ( Canadian ) to $18.90 yesterday in heavy trading on the Toronto Stock Exchange amid concerns that the gold producer is sacrificing near-term earnings and cash flow to expand its gold production and reserves.Analysts said investors are also worried that Placer is prepared to pay a big premium for Getchell shares, which soared $11.69 ( U.S. ) to $27.87 yesterday on the American Stock Exchange.Continued..............................................
http://www.theglobeandmail.com/docs/news/19981215/ROBFront/RPLAC.html

04:00 NCB NATIONALIZATION MEANS BANK OF JAPAN LOSES $686 MILLION IN 1998:FT.

http://www.tampabayonline.net/news/news1000.htm

Mining Journal dated Nov 27, 1998, from the SF gold show:

The open offer announced earlier this month by London-listed Randgold
Resources Ltd has closed. A total of 13.9 million shares were offered, at US$2.50/share, on the basis of seven new shares for every ten held ( MJ, November 6, p. 375 ) . Some 13.3 million new shares were issued, of which 9.5 million were taken by existing shareholders under the offer. The balance were placed at the same price with institutional and other investors, including 1 million shares with a wholly-owned subsidiary of Randgold Resources' parent, Randgold & Exploration Co. Ltd of South Africa. Take up under the open offer was 68.7%, although this included the 7.9 million shares taken by directors of Randgold Resources and by Randgold & Exploration as a 57.7% ultimate shareholder in Randgold Resources. The offer was partly designed as a means of turning into equity a US$20 million
loan owed by Randgold Resources to its parent, and this was specifically covered by the parent's proportional share of the open offer. Funds raised for Randgold Resources by the rest of the offer and the placement were thus about US$13.4 million before expenses. The interest held in the company by Randgold & Exploration has risen as a result of the offer and placement to 61.3%.

Latest London Bullion Fixings

Gold AM Fixing ( 15 Dec 1998 ) : 173.560 Pounds Sterling
Gold AM Fixing ( 15 Dec 1998 ) : 292.500 US Dollars

Gold PM Fixing ( 14 Dec 1998 ) : 172.733 Pounds Sterling
Gold PM Fixing ( 14 Dec 1998 ) : 291.400 US Dollars

Silver Fixing ( 14 Dec 1998 ) : 2.8448 Pounds Sterling
Silver Fixing ( 14 Dec 1998 ) : 4.7850 US Dollars

As if to be right on cue, 'dire' warnings about your 401Ks and the stock market were mentioned by the talkings heads if Clinton is booted from office.

BTW,impeachment means to accuse ( a public official ) before an appropriate tribunal of misconduct. It doesn't mean you get thrown out. There is no such thing as censure in the Constitution, the closest thing to be found is the impeachment process. If Clinton is 'censured', then you can be sure that the 'censure' will be expunged from the record. If it is not expunged, then its constitutionality will be tested and found NOT to exist. Thus, Clinton will skate free if he is censured. The only correct path is to impeach and remove from office. Anything less is a victory for Clinton and will probably result in a major 'upcrash' for the day or week of its occurrence. Therefore, Clinton will probably hang in there as he has done so many times before.

In the event of Clinton's actual removal from office, then gold would probably rally due to a faultering dollar and the equity markets would sink, again, due to foreigners pulling out of our financial markets and the subsequent currency flows.

If the past is any indication of the future moves on the part of this administration, then look for higher aspirin prices in the future... Oh yes, stay away from those aspirin factories too.......

BTW, congratulations to any holders Getchell Gold stock last week. I think this consolidation will pick up speed now and result in more take-overs. Gold prices have been depressed for so long, that buying gold in the ground must be looking very attractive now at these share prices. After all, we've seen speculative bubbles develope everwhere else, why should we be left out? Now, where to find maps of all of these abutting properties... :- ) )

I read and understood them. What I saw yesterday was not futures purchases but apparently direct purchases of the index itself. Is this possible? Where does the money go? I mean the PPT imagines into existance lots of money to purchase these contracts and or shares. Do they later sell them? hold them? It seems very very inflationary. I'm really to stunned to have much of an opinion.

http://dynamic.webpoint.com/news/tribune/story/0,1021,95009185,00.html

http://cbs.marketwatch.com/news/current/stwatch.htx?source=htx/http2_mw

I guess You'll Have to Apply for a new password - took me a week.

means DEFAULT and that means loss of trust in PAPER.

Then the US is the purest, most transparent Socialist nation in History. The world is not as I thought.

http://cbs.marketwatch.com/news/current/erdman.htx?source=htx/http2_mw

I think B-52's can carry the SLAM-LR missile which has a considerable range. If so, these missles may already be on their way. Velocity of these missiles is maybe something around 540 knots? Impact may occure right around the time that gold opens today! my Battle Damage Assesment of the effect of a missile strike on the price of gold is up, $1.50-$3.00. BDA for Clintons chance of impeachment? You all call us merkins and that sounds kinda cute, we are stupid most all the time, but we are not that stupid. If Clinton bombs Iraq, I am certain he will be impeached and removed from office.

Why B-52 launched missiles? I hear we are almost out of the TLAM-C, TLAM-D, and TLAM-blockiv tomahawks.

Course I read all this junk on the net, so who knows?

Latest London Bullion Fixings

Gold AM Fixing ( 15 Dec 1998 ) : 173.560 Pounds Sterling
Gold AM Fixing ( 15 Dec 1998 ) : 292.500 US Dollars

Gold PM Fixing ( 14 Dec 1998 ) : 172.733 Pounds Sterling
Gold PM Fixing ( 14 Dec 1998 ) : 291.400 US Dollars

Silver Fixing ( 15 Dec 1998 ) : 2.8885 Pounds Sterling
Silver Fixing ( 15 Dec 1998 ) : 4.8700 US Dollars

Some of the allegations mentioned in the article would be difficult to prove given the reluctance of NSA to reveal its eavesdropping "sources and methods"...IMHO. I found another article relating to this subject stating that the DTRA ( recently renamed from the Defense Special Weapons Agency, the U.S. Nuke overseer ) is performing a detailed analysis as to what exactly was transferred and how it could have helped the Chinese and "hurt" the U.S.

New York Times
December 15, 1998
Pg. 1.

Evidence Of China Plan To Buy Entree To U.S. Technology

By Jeff Gerth, David Johnston and Don Van Natta Jr.

WASHINGTON -- After a two-year investigation of Chinese political contributions to the 1996 election, Federal authorities have unearthed new evidence that Beijing's efforts were part of a broader campaign to obtain access to American high technology, according to lawyers and investigators.

While still incomplete, the evidence provides a clearer understanding of China's motivations -- and one that differs substantially from the initial view of Federal investigators and a Senate committee that China intended to influence the outcome of particular races, including President Clinton's re-election.

Investigators now believe the money was intended to enhance the political standing of those passing along the contributions to Democratic causes, to give them clout in arguing for favorable policies on trade and technology.

"Technology was a primary motive," said a senior Justice Department official who spoke on the condition of anonymity.

For the entire article - http://www.nytimes.com/

ASA pays over 4%

I have been unable to access Kitco 24 hour spot gold chart. Are you using another site to obtain quotes?

Thanks to your tireless digging
And matchless research skills,
We all now know what was on
Page 1 of the New York Times

How DO you do it?

Indeedy

You go BOOM, yes?

Yes

Try http://www.MONEX.com/prices.html

The top for prices are real time spot prices.

OK

I have used several, if you want to see the price of gold as well as silver some other commodities and the main indexes and several currencies. Try http://cbs.marketwatch.com/data/dbcfiles/market_monitor.htx?source=htx/http2_mw

another good one might be http://www.quote.com/cgi-bin/jchart-form?genApplet=yes

this one is only one thing at a time but you can watch more detailed information.
hope that helps

Thank you. Do you know if the Kitco 24 hour gold chart will be back in operation?

went long march silver this morning at 4.90, stop 4.70

http://www.kitco.ca/gold.graph.html

All metals up.

http://www.mrci.com/qpday.htm

Aldeby, our down under brother's appellation "merkin" is hardly a charming nick-name ... it's also the noun describing a crotch-wig worn by cabaret dancers.

nuke australia ... afterward they'll ALL fit under one merkin.

Top o'tha day to ya, Aussies

Spud

U.S. doesn't have great stockpiles of SLAM-ER, but enough to send a signal to Saddam. Same with the TLAM-C/D/Block IV's.

There are a lot of options for dropping bombs on Iraqi targets, whether using B-52s, F-15s, F-14s, F-18s, or Naval surface ships as the launch platforms.

See this web site for some interesting information: http://www.fas.org/man/dod-101/sys/smart/index.html

R-Clinton-clone*: GO, you sales-clerk, GO! To Iraq.

BOOM

Indeedy

Go platinum! ( down! )

The Toronto Mining Issue McClellan Summation Index continues to decline. This measure of overall breadth must turn up for the next move in gold shares to materialize. Not yet.

The new lows on Toronto Mining issues continue to look sick. They have exceeded the benchmark 5 issues per day each day for over two weeks.

The 220 day MA of gold is at 294.98 and falling. We have to cross this level.

The 200 day MA of the Toronto Gold Index ( Yahoo ^TGL ) is at 6340 and falling. We were at 5918 on this index yeserday. Not good here either.

The trendline that rises at 2% weekly from the last major low is at 5689 this week. We are getting close to this stop loss level.

Everything is weak. Caution has been the word for several weeks. No change yet.

Except KITCO FRAMES...eh Bart....

Kitco indicator is FLASHING GREEN LIGHT ( VERY SLOW ) .....

yes I knew it wasn't a compliment, though I didn't know it had another meaning, perhaps I should be offended, but I laughed for a solid 45 seconds.

http://www.canoe.ca/TorontoSun/front1.html

FRANKFURT, Germany ( AP ) -- The president of the European Central Bank has told a German newspaper he wouldn't rule out further cuts in interest rates after the euro begins operations Jan. 1. In an interview with the weekly Die Zeit released today, Wim Duisenberg noted that interest rates in the euro zone are at historic lows.

http://www.newsday.com/ap/rnmpfn0p.htm
--
@ptwoskool: Cheers to you brother ptwoskool. : )

WASHINGTON ( AP ) -- Consumer prices barely budged last month as moderation in food and energy costs keep inflation under wraps. In good news for holiday shoppers, the price of computers, video equipment and toys all declined.

http://www.newsday.com/ap/rnmpfn0g.htm
--
@Nocte Volens: And cheers to you as well brother Nocte Volens : )

They're changing the weighting of the NASDAQ 100. Right now, the top 5 companies make up 60% of the index. It will be reduced to 40%. They are adding a few companies to the index. These companies are smaller companies. If a major drop occurs, the "trendy" stocks like Microsoft and Dell would really show a substantial drop in the index. There is one "trendy" stock in the new additions, however...Amazon

http://www.nasdaq.com/reference/sn_ndq100_annual.stm

TOKYO ( AP ) -- In a move that could exacerbate U.S.-Japan trade friction, Tokyo has decided to impose hefty duties on foreign rice to slow a rise in imports caused by quota requirements, a news report said Tuesday. The tariff on imported rice will be 350 yen ( $2.98 ) to the kilogram -- a rate of 1,000 percent -- and is expected to be introduced in April next year, the mass-circulation Asahi Shimbun reported. On Monday, U.S. Ambassador Tom Foley warned Japan against implementing a rice tariff, saying it could "cripple" U.S. rice imports to Japan and trigger a "very serious ( trade ) disagreement." Tokyo has brushed aside U.S. complaints on the issue, saying the duty conforms with World Trade Organization regulations, the Asahi said. The United States is a major exporter of rice to Japan.

http://www.newsday.com/ap/rnmpfn0i.htm
--
You want tax Japanese steel ? We tax rice ! Keep rice at home United States.

I'm getting tempted to flip a few levers just for the helluva it.

WASHINGTON ( AP ) -- You heard the Dust Bowl was bad? Scientists who have studied historical records and scientific data say the Great Plains could be in for even worse droughts over the next century. Droughts as bad as the 1930s Dust Bowl occur once or twice a century, and there were longer, more severe "megadroughts" in the 13th and 16th centuries, according to a study released today by the National Oceanic and Atmospheric Administration.

http://www.newsday.com/ap/rnmpne02.htm
--
Let's hope they aren't spurred on my El Nino or something.

at 4.90? I realize you had posted that the low in the next ten days,
with this being day 4 I believe, could possible BE the low for gold
and silver before the next big move UP. Are you thinking the recent
4.72 low in March Silver could be it, and, thus, you're getting in
now, with a stop at 4.70 if it isn't the low? TIA Fox-man

Is making a run for it: 191.93 +1.26 +0.66%

vote which before was considered a joke by the general media appears to be imminent. Now the pissant rumblings from the media turn upon the Senate with the supposition that impeachment will be thrown out. The stock market is finally showing what has been known for a long timethe party cannot continue forever. Countries around the globe are fighting back as their people suffer greatly while the population of the US lives in la la land. Y2K looms before us, nothing has been accomplished in the ME save some more useless paper being signed. Asia is a confrontational maelstrom waiting to be uncorked by N. Korea. And Africa is still witness to some of the most horrendous crimes against humanity ever seen and allowed by man. Russia and its former satellites are a mess with starvation, lack of heat and pharmaceuticals facing them as we enter a new year. The IMF suks and is still doing a fine job of ruining countries
with their barbarous and austere impositions. I still say get CAMDESUSS!

All in all a cauldron of hysteria. And smack dab in the middle of it, Washington D.C. who has its fingers in virtually everyones life worldwideahya gotta love CENTRAL PLANNING..............NOT

If any lever ever needed pull'n, it's gotta be the CRB ...

http://www.washingtonpost.com/wp-srv/WPlate/1998-12/15/034l-121598-idx.html

Date: Sat Nov 21 1998 12:47
Mooney* ( Gold's 1998 Closing Price ) ID#350194:
Copyright  1998 Mooney*/Kitco Inc. All rights reserved
Early this morning Selby and Auric and perhaps others ( aurator? ) were discussing price
predictions of Gold. Conclusion: - One guess is as good as another. Most of the time this is a
fact. Even a reasoned estimate is still a guess due to the fact that NO ONE is privy to ALL
the necessary inputs to the equation of a future price whether it be two days from now or two
months from now. Beyond two months, is, let's face it, just an out and out quess. There is at
the present moment, however, one impressive and obvious trend in price. Whether this is out
and out manipulation or just the counterbalancing of the many positives and negatives daily
affecting the price I will not speculate in this post. The obvious trend that I refer to at present
is a stable price. Look at the weekly closing prices,..."
( Here I reprinted every Friday's closing since Sep.11th, which were all very close in price and thus range-bound. Mooney )

"... ( Also ) The final close of 1997: $US 289.90 Based on the above it would seem a fairly safe bet that, unless something catastrophic happens, Gold will close 1998 safely in its box somewhere between $US 290 - $US 300."
Gold Still In The Box!

VERY interesting charts of Silver posted lately by Gollum and others showing technical signs indicating that Silver is about to break-out.

If gold doesn't punch 300 soon a bleak spring and summer awaits.

been busy, and I've been out alot. I try to scan the posts quickly
and sometimes miss the good stuff. I hope to make a kitcoite gathering
some day! It would be great to meet many of you! I'm a Mid-westerner,
living hear in Kansas. See ya, Fox-man

All: It's finally coming out -- the Communist Chinese had an organized plan to gain access to US Technology -- part of the plan being to influence the 1996 elections. Amazing how long it took before this came out -- we knew about it over one year ago. Others obviously knew longer than this. Ron Brown's death very conveniently delayed the process of enlightenment.

http://www.nytimes.com/library/politics/121598donate.html

You will see from the article that it is cautiously written, but it does look like the floodgates are opening. My guess is that the gloves are off. It will be very hard for Janet Reno to keep a lid on this much longer. And -- if the public learns what our president has done with our hard-earned military technology -- they will be incensed. My guess is that there will be more news like this released to keep the impeachment proceedings moving forward, or until WJC resigns. How quickly all of this unfolds, and whether the markets go up before they go down is another matter. However, if history is of any value in predicting what will happen, the markets will go down and precious metals will go up until the impeachment issue is resolved.

My guess is that Gerth, Johnston, and Van Natta will produce a series of articles on this topic -- comparable in impact to the famous Woodward and Bernstein series on WaterGate.

Again, I do not blame the Communist Chinese. It was like taking candy from a baby. No espionage experience necessary. And -- more damage can be greated by encouraging your spies to get immunity, and testify -- Charlie Trie, John Huang, etc. A win-win scenario for the Chinese. Scandalous for the American leaders.

Gold & PM complex up firmly and XAU flatlines..
Go figure????

Thnak you for your comments.
You say:
"Y2K will not strike on any particular date, but will be spread
out over the next 18 months. Y2K problems are already occurring.
Testing will bring out Y2K failures at random times. There are
many different dates that are failure points. Different fiscal
years. Some problems will be fixed quickly, some will not. Some
will occur 3, 6, 9 or 12 months into the future."

Yes, I agree with you. The timing *will* be spread out over many "event horizons". And that is a good thing. It allows us to fix those problems that occur, and discover others we would not have found. For example, my software, unmodified, would have died on 1/1/99.
But while this addresses earlier problems and *anticipated* future failure, it does not address the unanticipated failure of the unknown.
When I said "all-at-once-and-everywhere", I did not mean to say that there would not be earlier ( or later ) failures, but that the unknown, and therefore unplanned for, and unremediated software *will* stop functioning on 1/1/2000, or shortly thereafter. This much I can safely say. What that *means* gets into the gray area.

You futher say:
"The world *has* seen a similar situation. Any of the depressions.
The whole argument of the "supply chain" failure causing
systemic failure is the SAME model. The U.S. economy
collapsed over a three-year period. Do you believe that
the "supply chain" was not disrupted then?"

Yes, I agree that the supply chain was disrupted then, but but I don't think that it is the same or even similar. In the 1930 depression, I don't believe that people had the huge dependency on the automated control aspects of the computer for electricity generation, or delivery of rail cars or JIT inventory modeling. I live very near to the Boulder Dam on the Colorado River in Nevada ( Built in the 30's ) . On a recent tour there I asked the guide how the 17 generators were adjusted to have the sine-wave output be synchronized. He said, "By computer". I asked, "If the computers fail, can you do it manually?" "Yes", he said, pointing to control stations between the generators, which were unmanned, and had been unmanned for decades. "Each generator had a 'controller' ( a person ) who would stand up there, and keep the generators spinning at the correct speed". My silent mental note was, "Yeah, and I'll bet that it would be nigh impossible to find enough people today to man these stations ( 19 of them ) 24 hours per day".
As to discussions whether or not there will be widespread problems, I think that that it masks the real problem, ie people not preparing because they *believe* that there will *not* be a problem. Now, if the costs of preparation were excessive, such as buying a generator without thinking about the attendent costs of fuel, storage, danger, etc. Or buying a small aresenal of weapons and ammo, or building a "fallout style bunker" in the backyard, then, yes, some commonsense should be applied. But to put in some water, food, and supplies for a one year duration only costs for 1 ) The lost opportunity cost on the cash since the money will have to be spent in the next year anyway 2 ) Spoilage costs if you buy wrong-dated stuff 3 ) Storage costs if you are short on space 4 ) minimal preparation costs.
So, my exhortation still stands. Be prepared for 3 months or a year if you can. If there is a big problem, then the small preparation pays big dividends. If there is no big problem, then there is no loss. Sounds like a good investment to me to hedge uncertainty. I hope there is no problem, I'm afraid there will be.
-cg

Gold looks awful here. I just got out of my longs. I think that Mike Stewart below just said it all. Gold went up yesterday and the XAU went down. The XAU is leading Gold and the Lead is to the down side. At best I think we are stuck at $295.0 +/- a couple dollars for maybe ever!

tolerant1 ( It occurrs to me that the District of Columbia is unraveling...Clintler's impeachment )

It is a breath of "fresh air" to read comments by an American who sees issues beyond the shores of the USA.

I am presently at Kookynie in Western Australia, exploring for GOLD. It is not an easy exercise, especially in 35 to 40 deg C heat.....and a cyclone about to descend on us.....character building !!!!!

Aye,

Haggis

XAU again IMHO at a critical point, could go either way soon.

http://www.imagen.net/howenow/ An investigator of stock market scams and the scam artists methods as seen in Newsweek august 24/98 page 38

in me is lovin it!!! Question; If you saw ( in print ) that a large majority was betting on one direction versus another, would you join them or would you bet the other way? Hmmmmmmmm!

Depends if they were doing it for a living or not.

Envy: There are two major cycles in our weather that will affect the next century. One is that the ENSO/SOES cycle seems to be increasing in amplitude over the last hundred years or so -- longer term than the sunspot cycle. Fascinating. More than the usual sunspot activity in the current and future solar cycles? More weather extremes likely for some time to come.

Secondly -- and I am rusty on what I said last April when we had a 19year or so peak in tidal activity driven by the nodal cycle of the moon.

I can't recall the exact date, but my analysis indicated that the next tidal activity minimum would be around or somewhat after 2020. This period is highly significant, as the great depression/drought in the US was at a lunar tidal minimum as well. I also told you all the tidal maxima and minima tend to correlate with major market turning points, and with the ENSO -- ElNino cycle. The data is of worldwide significance, but I only have market data for the US.

What is important in all of this is that the really bad droughts in the US may wait until after y2k.

I will review my data when I get a chance. Unfortunately I have been able to discern only very long term trends. My tidal analysis is of little predictive value on a daily or monthly basis.

Today's numbers for yesterday..................122 calls, ......1451 puts.
If you look at the last couple of weeks, this is the trend. IMHO!

your comment...Great luck and a gulp and a puff to ya in your quest for the precious and for goodness sakes find a deep cave before the cyclone hits...

Your answer is positive for POG yes? Is l222 contracts enough volume to influence the price?

I think the negative barometer is positive for POG. Most bearish sentiment on Kitco I have ever seen . Hope it moves soon. UP that is.

Keep up encouraging posts.

TIA

First let me say I'm not real comfortable with this trade, but some times they work better then the 100% sure bets. I'm not nearly as aggressive as I would be at 4.40 in fact I may be out by the time you read this. It's possible the low came in a week or two ago in the night session at 4.56. In the past 8 or 9 days mar. silver as been in a range between 4.87 and 4.70. I watch 60 and 15 min bar charts. It has been a stuggle to keep the market in the lower part of that range. Yesterday it broke out and held above 4.87 and has held above it for the last several hours. I also know there should a low in this time frame. Also, the xau despite it's chopping around has held 65 an important number for me. If it holds i could get projections between 103 and 128. This would certainly take silver up in a hurry and I don't want to be chasing it. Sum it all up its worth taking a chance but not a real aggressive one.

.

Good!

Let the fun begin!

I am, and have been, an active trader of mining shares for almost 20 years. As such, this site is my favorite for information regarding PM and the mkts in general. Almost every day I learn something valuable with regard to investing. So I thank many of you for the information. But I am saddened by the constant unwillingness of many on this site to allow any sort of comment which does not conform to their own ideology ( i.e. conservative dogma ) . The most irresponsible comments can be posted with impunity as long as they reinforce the dogma that Clinton, AG, US, and liberals are all under the influence of the devil or the communists. We saw it last nite when ptwoskool pounded Envy when he or she thought ( mistakenly ) that Envy had posted a positive article about Clinton's impeachment issue. Ptwoskool apologized when he discovered his/her error. To me the opology was worse ( sorry, I thought you had a different idea ) . Many of us moderate and liberal democrats are decent and knowledgable. But, my guess is that others of my political bent who visit this site just lurk, as I do most of the time, as we dare not stick our nose out. Only by weighing the many sides of most issues do we learn. All societies who refuse to learn make a lot of mistakes and eventually perish. I know this is hard to believe, but conservatives do not have all the answers; and there is another side to this impeachment question. Just ask 2/3 of the nation.

points for the metals. I would buy one Mar Silver at 4.90, for instance,
and then buy another at, say, 4.70. Of course, this could get dangerous
if there's any chance it could go dramatically down, like to 4.00 or below. So, I may have to limit my average but points. Also, I'm restricted with a limited supply of revenue. I've already lost alot by
playing these metals markets, long before I knew how helpful TA chart reading can be. Thanks again....Fox-man

yesterday @ 1.40 for the wts 04. The lowest by far that I've ever seen the.

I hope I'm taking advantage of tax loss selling. But I stil have that bad feeling about POG. I guess my greed outweighs my fear. If the financial system collapses & POG goes down to 250- for a couple years, I'll lose.

Mike Stewart--I see that BGR finally settled the tax dispute with Ont. & wrote off the settlement in the last Q.

I agree that we should strive for civility. As for the argument that 2/3 of the nation are right - That sounds like "Eat s***, one hundred billion flies can't be wrong".

The daily gold chart is really beginning to ripen.
The pattern since 8/28 is a familiar one and should yield a nice bull market. Question is, how long will we go sideways? Similar charts show onemore move up and maybe through the downtrend line followed by hesitation and then a screaming bull move. Some charts show another move down to the mid 280's, but that would have to happen this week, I think. If that happens, we won't be down there very long. At any rate there should besome kind of a top in about 3 weeks--probably near that downtrend line, followed quickly by the move up very quickly to 320 and beyond.

If you have access to old charts, compare SM wkly 86, LH May-Jun 86 and Jun-Mar 87, Lc Mar 87, O Mar 87, lum jul-jan 87, CD wk 86, JY Feb 87.

I'll leave you with one chart pattern for silver that might send chills down your spine--Heating Oil jun-jul 90 where it went from .50 to .60 before Saddam invaded Kuwait. Fundamentals always trump technichals, but it is an interesting chart bottom similarity to the last several months in silver

They had a Clinton apologist on one of the political talk shows last night calling those in favor of impeachment evil.

You want to talk about pure Clinton hogwash read this quote:

 "I totally condemn what the president did ... but millions of
people will suffer and die because the Republican Congress
wants to get President Clinton for a personal sin," said Rev. Paul
Moore.

It's no wonder pork bellies are in a downtrend.

Latest London Bullion Fixings

Gold AM Fixing ( 15 Dec 1998 ) : 173.560 Pounds Sterling
Gold AM Fixing ( 15 Dec 1998 ) : 292.500 US Dollars

Gold PM Fixing ( 15 Dec 1998 ) : 173.569 Pounds Sterling
Gold PM Fixing ( 15 Dec 1998 ) : 292.550 US Dollars

Silver Fixing ( 15 Dec 1998 ) : 2.8885 Pounds Sterling
Silver Fixing ( 15 Dec 1998 ) : 4.8700 US Dollars

Date: Mon Dec 14 1998 18:34
Who Cares? ( 2PPTR02PPT ) ID#242214:
2BR02B doesn't believe in the PPT....

To paraphase Mother Abigail in _The Stand_ --

"That's okay, 2BR02b... They believe in you". : )

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The orbit of Kitco sometimes reminds me of the sociological studies done on small groups living in remote isolation for extended periods in places like Antarctica. An us vs. them mentality develops with accompanying paranioa, a locally unique jargon emerges referencing things
comprehensible only to the residents...etc.

As with Bigfoots sans skeletal remains or alien spacecraft without wreckage, extraordinary claims require extraordinary evidence. Every mention of US market manipulation with public funds in relation to unusual, suspicious market activity that I've come across has carefully
pointed out that they have no credible, factual, irrefutable evidence of same, only suspicion.

is now trying to dictate terms of Clintler's political demise.

This whole sorry episode smacks to me of a political system that is careening out of control with the right wing fanatics seeking revenge at any cost.

I picked up some ZPA at .10. The company has a decent property and no debt. Sure got hammered by tax write-off though. --Al

LOL! I think it's more likely we'll see liberals eating crow than conservatives eating organic.

sitting in my portfolio @ .04 which I bought @ 1.50. I leave it there so that every day it reminds me of the futility of buying individual jrs.

"...just ask the other 2/3 of this nation..."

yea - right - quote those corrupt polls taken by the Liberal Media.

Shall I ask foxes to guard the hen house as well?

The "other 2/3" of America want that lying bastard and his whore-cabinet out in the cold. Do you REALLY THINK the rest of America buys or swallows the "rotten" poll numbers anymore? ASK AN HONEST QUESTION: "DO YOU THINK THAT BILL CLINTON SHOULD HAVE HIS ASS KICKED OUT OF THE PRESIDENCY FOR HIS UNABATED, SHAMELESS LYING TO THE AMERICAN PEOPLE, FOR USING THE OVAL OFFICE AS A WHOREHOUSE, FOR COWARDLY AND DEVIOUS BEHAVIOUR ( Monica as a stalker ) ?"

Let me repeat that, O highly educated product of An Ivy League Education: the relentless popinjay squawking of cooked-poll numbers by the equally corrupt Television/Hollywood/NPR media no longer can hide the gross and perjurious actions of Clinton.

The Liberal/Left/Democratic Party have betrayed the "other 2/3 of this nation" with shameless lying, corruption, betrayal of the US Constitution, dealing with Chinese Communist war lords, Indonesian magnates, Bhuddist-vows-of-poverty $5,000 political contributions... anything for POWER ... anything for MONEY ...

... consequently, Bill Clinton and his cabal of crawling sychophants are destined for history's Hall of Shame.

but ask me how I really feel about this group of thugs.

Spud

A pox on both their houses! "Under capitalism man exploits man: under socialism the reverse is true."--Polish proverb

I agree that dissenting opinions should be welcomed. But I disagree with your 2/3 number. 38% now favor impeachment. Up from 32% one week ago. If this continues, the majority will favor impeachment in two weeks.

Also, if you look more closely, the 38% are also the ones that are watching the hearings. Included in the "2/3" are those that just don't want to hear about it. I remember a poll in August in which 74% favored impeachment if it were proven that WJC committed perjury. Last week a poll showed that 84% believe WJC committed perjury. Interesting inconsistencies that should resolve themselves over the next few weeks. My dissertaion was in statistics and it is my opinion that the momentum is for impeachment, based purely on the numbers. However, all polls provide inherently biased estimators ( again speaking as a statistian. ) Not that they are not useful.

I welcome any information or opinions that would help explain these inconsistencies. I agree that you and any others that chose to offer opinions contrary to the majority opinion here should not be flamed. Good investment decisions can only be based on the consideration of all data. An accurate prediction of the course of these events will improve my decision making regarding precious metal investments.

Namaste

2 ounce gloves with little padding...On point number one  I say having a point in every direction is like having no point at all

On point number two  I agree...yet you refuse to believe it is you who have learned nothing from the impeachment proceedings

On point number three  it is meaningless as polls mean nothing...

If anyone is having problems accessing our kitco.com server, use kitco.ca instead. Our gracious hosts made a system configuration change without giving us proper notification rendering kitco.com inaccessible

If you're not having problems accessing kitco.com then be careful before making any trading decisions because you're looking at data that 2 days old.

Use http://www.kitco.ca/gold.live.html and take the links from there to get to the charts and the rest of the site.

Sorry, I forgot: Saint Hillary's solemn intonations that only Massive Right Wing Conspiracists have Right Wing Fanatics.

Yep. Care to name a few Left Wing Fanatics, James, who work for Bill Clinton?

We're all waiting to see just how UNBIASED you may be.

As for Bob "Past his prime" Dole - get a clue - when Clinton et al tried to "help him out" during the primaries against REAL Republican alternatives like Steve Forbes, Bill Buchanon etc - that should have told you all you needed to know about Dole. A "pink" Republican.

An appologist. Now we Dole licking up to support censure for Bill. What was your price this time, eh Dole?

Spud, sick of both parties

media has been spoon feeding the shepple in this country! Be your own person, if you know someone and they continue to lie to you, would you want him to be the head of your company? This poll is not manipulated, controlled, presented or done by any media. Maybe you should ask yourself why this untouched poll has bacically stayed at these levels since August 17th! Hmmmmmmmmmmm But then the people have got the mainstream news to tell them what to think.





AOL Poll:
.


Several national polls show that a majority of
Americans are opposed to impeachment. Should
lawmakers in the House consider public
sentiment when they cast their votes this week?

Yes, they are representatives of
the people
38347
39.2%
.
No, they should be above
poll-watching
57936
59.2%
.
Not sure
1507
1.5%
Total votes:
97790


When they vote, should lawmakers consider any
effect an impeachment of the president might have
on the stock market?
.
Yes, if they think it could spell
economic trouble for our nation

25612
26.2%

No, the stock market should not be
a consideration

69162
70.9%

Not sure
2817

2.9%
Total votes:
97591


Do you believe a vote FOR impeachment is a vote
FOR removal from office?

Yes, a vote to impeach should mean
the representative thinks the
president ought to be removed from
office

43820
44.9%

No, a vote to impeach should mean
only that the representative thinks
there is enough evidence to warrant
a trial

51075
52.4%

Not sure
2659

2.7%
Total votes:
97554


Do you think a trial of the president in the Senate
would paralyze the government and distract the
nation from other issues?

Yes, it would cause paralysis and
distract the nation. It would be a
disaster
34387
35.3%

No, a Senate trial is an important
part of the functioning of our
government
60077
61.6%

Not sure
3015

3.1%
Total votes:
97479


President Clinton has stated that he has no
intention of resigning in the face of the
impeachment vote. Do you think he should
resign?

Yes, he should resign and spare
the country any further trauma
61547
63.0%

No, he has apologized and is
trying to make up for his actions
33257
34.1%

Not sure
2815

2.9%
Total votes:
97619


What should Congress do to President Clinton?

He should be impeached by the full
House, and removed from office after
a Senate trial
56419
57.9%

He should be impeached by the
House, but the Senate should seek
an alternative to removal from office
7043

7.2%

He should be censured by the
Congress
17992

18.4%

He has suffered enough, the matter
should be dropped
16072

16.5%
Total votes:
97526


I am

Male
62527

64.3%

Female
34659

35.7%
Total votes:
97186


I am a registered

Republican
38868

40.3%

Democrat
24890

25.8%

Independent
26576

27.5%

Third-party member
983

1.0%

I am not a registered voter
5227

5.4%
Total votes:
96544


My age is

under 18
1392

1.4%

18-29
9558

9.8%

30-39
19506

20.0%

40-49
26820

27.5%

50-59
22181

22.7%

60-69
12982

13.3%

70-79
4698

4.8%

over 80
394

0.4%
Total votes:
97531

do you know anything at all about economics?

Under socialism man succeeds by exploiting man. Under capitalism man can only succeed by working and serving man since theft ( the only way socialists know how to produce wealth ) is outlawed.

Could you please stop slandering the right wing? Or is it impossible for you fascists to believe anything but the worst about the motives of the other side?

Alternate viewpoints and discussion of the issues Without person-bashing are sorely needed on Kitco and throughout our society. Too often, we have become only willing to listen to persons with our own viewpoint. If we do choose to discuss an issue with someone with another view, it is often only to attempt to "convert" him or her to our "side".

Stick around, maybe we can learn better manners and encourage others to post.

BTW, I used to be a liberal democrat, then a conservative republican. Now I don't want to be under any label, but prefer to be a " ( George ) Washington-ite" ( no political party, think independently. )

I have an old electric lead melting pot. It was designed to melt lead for making fishing weights or casting bullets. I don't do either anymore, but would it likely melt silver? I don't know what I'm up to, that is I don't have any plans, but just gathering info. The pot is made of Al. Don't worry, I'm not going to melt silver eagles or anything, I just want to know things. Also, one of you mentioned that you send melted gold out to a refinery. How do they refine gold? By gravity? By some sort of molten solvent partitioning? Don't worry, I'm not going to play with molten metals and solvents any time soon. I just want to know more.

I could say a lot. But I'll simply mention that my senior
business strategy textbook concludes that what you would
call "conspiracy" and "paranoia" are the best method to
achieving business goals, particularly in an environment
dominated by oligopolies.

Your analogy falls flat in that I, personally, do not believe
that "Greenspan is out to get me". Heck, he's not even after
gold owners. He's trying to keep an impossible situation
going, the fallout is incidental.

There's plenty of evidence. In 1985-86, Congress had hearings
on the equivalent of Batra's theories. In 1986, they passed
legislation that effectively popped the real estate speculation
market. I ask you to extrapolate what *would* have happened
if they had not... The '87 market crash would have almost
coincided with the Japanese crash in 90, the fall in market
values and land values would have been much stronger.

Citibank went bankrupt in '93. The entire banking system
was ready to collapse. This is historical, it's a repeat
of previous depressions. Plenty of evidence at Citibank,
if you want to look it up.

Or read Greenspan's speech late last year. For anyone
that has been paying attention, Greenspan admitted he
had "confronted an economic anomaly". Heck, chum, why
on EARTH do you believe they abandoned M-2 as a measure
of economic growth? Because they KNOW what they're doing.

To a point. I mean, really. You think they just willy-
nilly said, "Hey, I wonder if we just abandoned this
measure we been using for 50 years... maybe it ain't
right anymore" ??? Ray Dalio, Barron's Oct. '93. Read his
article on money growth. Titled "Depression, Not Recession".

Greenspan knew exactly what he was doing when he drove down
interest rates during the '91 recession. He's got 200 years
of history to draw upon. I can even tell you what his
general goals are, simply from observing during the past
eight years -

He'd like to chop about $2 trillion off the stock market, but
in a gradual fashion. He'd like to lock down long-term interest
rates below the rate of economic growth. It's a simple
equation, I've posted it many times -

Total debt payments = ( Some Konstant ) X ( Average Interest rate ) .

To maintain equilibrium, then

Debt payments / year = net gain in goods & services / year.

That's the goal.

http://www.cbn.org/news/stories/981214.asp

ABN Amro issues buy on PDG

Apparently, one of those views, made in jest, is that House Judiciary Committee Chairman Henry Hyde ( R-Ill. ) , a Clinton critic, should be killed. And that a mob could kill Hyde's family too.

http://chicagotribune.com/splash/article/0,1051,SAV-9812150099,00.html

The point is who with what money for what reason at who's
behest entered the Chicago futures pit and turned the market
around in the October '97 crash.

that BJGate should not be occupying my time. However, the President is the one who caused this situation to spin out of control - not me. Therefore, I have to protect the Constitution and REQUIRE the President to honor his solemn oath to the American people as the leader of our country. Each year, the President swears to uphold the Constitution and protect us. I am truly sorry that he lied. My gripe is not the lie in the Paula Jones Depo - it wagging his finger at the American people and saying - 'listen to me. I have never had sexual relations with that woman - Ms Lewinsky ...'. This perjury ( not in legal terms ) speaks volumes of BJ Clinton's contempt of rules and respect to the American people. As to the polls, I doubt desegration was popular - but it was right !!! So BJ,you bet I am angry that YOU have put me ( Congressperson ) in this position. I was elected to address other issues. If voters in my district are not willing to re elect me because I think you lied - then I am not much interested in representing these people anyway!!!!!!

Bill Clinton and Al Gore insist on controlling domestic mass media and business computer security. They are hurting American security. Their policy costs lives and money. It helps the terrorists, criminals and hackers penetrate vital computer systems that control banking, communications and electric power.

In addition, Bill Clinton used government policy to blackmail American businesses seeking export licenses. Clinton used his office for extortion, selling the secrets of our military communications to enrich himself and remain in power.



http://www.worldnetdaily.com/bluesky_smith/19981215_xcsof_give_it_to.shtml

clinton gives me a butt-rash

i just tied a knot to the end of my rope. gold or death, at this point either would be nice. welcome to the bottom of wave 2 -- the pressure is almost unbearable.

i'm starting to show signs of weakness. any positives from caring souls would be appreciated at this moment of trial.

thank you

It doesn't matter who is manipulating the market. That's
just a function of oligopolies. By definition, their actions
are capable of causing prices to rise or fall, and as markets
become more olipolic, the more important it is to WATCH the
ACTIONS of the other players.. Ergo, over time, the
environment resembles a "conspiracy" and "paranoia" reins.

It took me several years to understand why Batra, Davidson,
Puetz and Grant were wrong. Their predictions all failed
for one reason - because they strongly believe in "free
markets", they assumed that the environment of the "economic
collapse" would BE a free market.

It is not. Look at history. We know that J.P. Morgan propped
up the market in 1907. Or was 1913, egad, I can never remember
that one. We know that John Law and the French government
conspired to keep paper shares rising in price. We know that
Hong Kong tried to prop their market this year.

My point - it is a MISTAKE to believe that we live in a time
of "free markets". Personally, I just got tired of losing
money, being wrong all the time. I'm a lot happier with
my current model of the world.

In other words, there is no credible evidence of a PPT.

If you want to believe that no manipulation is taking place,
it's your business and your money. I might suggest reading
that article by James Grant again, "Welfare State of Credit". : )

Now, my personal opinion is that Clinton is a traitor. He has repeatedly displayed contmept for the Constitution through words and deeds. I hope that we are on the verge of an awakening here, and that the proper balance of power between the three branches of government will re-establish itself without violence.

Rememeber, that 200 years ago "2/3" of the population favored subjugation by the Brits. Only a minority favored independence and liberty. Further, only 1-2% of the population took up arms "against the king." As a statistician, I recognize that we are well beyond this point.

Be afraid. Be very, very afraid.

I'm not entirely unsympathetic to some of your wider views.
Several of Grant's books are here on the bookshelf, dog-eared
and scribbled in the margins. I crosslinked the aforementioned
essay here to Kitco, finding it quite good.

I don't understand your post, but it sounds pretty grim, I hope your overstating things somewhat. cheer up ok?

To succeed in any kind of investments,in my opinion,an investor MUST be aware only of one issue: THE PRIMARY TREND. The primary trend can be bullish or bearish. In a bullish trend,investors will invest in stocks, real estate, businesses,etch. In a bearish trend investors should be in cash, PM's and businesses that are able to withstand bad times. Those who have understood this concept would have multiplied their money many fold over the years legally. A great bull market in stocks and bonds begun in Aug 1982 when the Dow was at 820 and was terminated on Aug 4, 1998 when the Dow Theory confirmed a change in the primary trend direction. In February 1998 I started posting warnings that we have entered a runaway deflationary phase. The primary trend is more powerfull than the congress, all central banks and all governments combined. A primary trend is a law unto itself. No one, I repeat,no one can alter or reverse the primary trend. It will intensify,run to conclusions and will exhaust itself before changing. Today, the primary trend is down and you should invest accordingly.

"Paper is poverty,... it is only the ghost of money, and not money itself."
--Thomas Jefferson to Edward Carrington, 1788. ME 7:36

"Experience has proved to us that a dollar of silver disappears for every
dollar of paper emitted." --Thomas Jefferson to James Monroe, 1791. ME
8:208

"It is a [disputed] question, whether the circulation of paper, rather than of
specie, is a good or an evil... I believe it to be one of those cases where
mercantile clamor will bear down reason, until it is corrected by ruin."
--Thomas Jefferson to John W. Eppes, 1813. ME 13:409

Specie as a National Resource

"In such a nation [as ours], there is one and one only resource for loans,
sufficient to carry them through the expense of a war; and that will always be
sufficient, and in the power of an honest government, punctual in the
preservation of its faith. The fund I mean, is the mass of circulating coin.
Everyone knows, that although not literally, it is nearly true, that every paper
dollar emitted banishes a silver one from the circulation. A nation, therefore,
making its purchases and payments with bills fitted for circulation, thrusts an
equal sum of coin out of circulation. This is equivalent to borrowing that sum,
and yet the vendor receiving payment in a medium as effectual as coin for his
purchases or payments, has no claim to interest. And so the nation may
continue to issue its bills as far as its wants require, and the limits of the
circulation will admit... But this, the only resource which the government could
command with certainty, the States have unfortunately fooled away, nay
corruptly alienated to swindlers and shavers, under the cover of private
banks." --Thomas Jefferson to John W. Eppes, 1813. ME 13:274

"One of three great measures necessary to insure us permanent prosperity...
should insure resources of money by the suppression of all paper circulation
during peace, and licensing that of the nation alone during war. The metallic
medium of which we should be possessed at the commencement of a war,
would be a sufficient fund for all the loans we should need through its
continuance; and if the national bills issued be bottomed ( as is indispensable )
on pledges of specific taxes for their redemption within certain and moderate
epochs, and be of proper denominations for circulation, no interest on them
would be necessary or just, because they would answer to everyone the
purposes of the metallic money withdrawn and replaced by them." --Thomas
Jefferson to William H. Crawford, 1816. ME 15:30

"It would be best that our medium should be so proportioned to our produce,
as to be on a par with that of the countries with which we trade, and whose
medium is in a sound state." --Thomas Jefferson to John W. Eppes, 1813. ME
13:430

Dangers of Paper Money

"That paper money has some advantages is admitted. But that its abuses also
are inevitable and, by breaking up the measure of value, makes a lottery of all
private property, cannot be denied. --Thomas Jefferson to Josephus B. Stuart,
1817. ME 15:113

"The trifling economy of paper, as a cheaper medium, or its convenience for
transmission, weighs nothing in opposition to the advantages of the precious
metals... it is liable to be abused, has been, is, and forever will be abused, in
every country in which it is permitted." --Thomas Jefferson to John W. Eppes,
1813. ME 13:430

"Scenes are now to take place as will open the eyes of credulity and of
insanity itself, to the dangers of a paper medium abandoned to the discretion
of avarice and of swindlers." --Thomas Jefferson to Thomas Cooper, 1814.
ME 14:189

"The States should be applied to, to transfer the right of issuing circulating
paper to Congress exclusively, in perpetuum." --Thomas Jefferson to John
W. Eppes, 1813. ME 13:276

"The evils of this deluge of paper money are not to be removed until our
citizens are generally and radically instructed in their cause and
consequences, and silence by their authority the interested clamors and
sophistry of speculating, shaving, and banking institutions. Till then, we must
be content to return quoad hoc to the savage state, to recur to barter in the
exchange of our property for want of a stable common measure of value, that
now in use being less fixed than the beads and wampum of the Indian, and to
deliver up our citizens, their property and their labor,
passive victims to the
swindling tricks of bankers and mountebankers." --Thomas Jefferson to John
Adams, 1819. ME 15:185

"Private fortunes, in the present state of our circulation, are at the mercy of
those self-created money lenders, and are prostrated by the floods of nominal
money with which their avarice deluges us." --Thomas Jefferson to John W.
Eppes, 1813. ME 13:276

"It is a cruel thought, that, when we feel ourselves standing on the firmest
ground in every respect, the cursed art of our secret enemies, combining with
other causes, should effect, by depreciating our money, what the open arms of
a powerful enemy could not." --Thomas Jefferson to Richard Henry Lee,
1779. ME 4:298

"I now deny [the Federal Government's] power of making paper money or
anything else a legal tender." --Thomas Jefferson to John Taylor, 1798.

Yes, the jrs have been quite futile. I held Arizona Star 3 years and watched it slowly waste away. Even averaged down once. When it blew it really blew. But we do need a metals turnaround after this write-off season ends. That 7-$8 silver would really help. --Al

Plunge Protection Team Set Up To Stem Another Market Panic

By MARCY GORDON AP Business Writer

Oct. 17, 1997

WASHINGTON ( AP ) - Alan Greenspan didn't hear about the crash until almost two hours after the close. The treasury secretary was on the Concorde to Europe.

As a wrenching panic unfolded on Wall Street that Monday, Oct. 19, 1987, the Reagan administration's top economic policymakers were out of touch. Greenspan, months into his first term as head of the Federal Reserve, was on his way to Dallas and Treasury Secretary James Baker was headed to West Germany to talk about interest rates.

Ten years later, the people who could have jumped in to restore the fragile trust that keeps money flowing through the financial markets don't plan to be caught off guard.

Beyond crossed fingers, the federal government has tried to ensure that if the unthinkable should reoccur in the stock market, its response would be quick and decisive and the lines of communication would be open between Washington, Wall Street and world financial capitals.

A little talked about part of that strategy is what the government calls the Working Group on Financial Markets. This plunge protection team was established after the 1987 crash.

David Ruder, who was SEC chairman during the 1987 plunge, said another crash would touch off a series of instant calls between top officials at the SEC, the Federal Reserve, the White House and the New York Stock Exchange.

The group's primary objectives would be to keep the markets operating and prevent a run by investors on mutual funds and banks. The goal is to "coordinate information flows," said a source familiar with the group, speaking on condition of anonymity.

The response by policymakers would be a bit faster this time "because everybody knows each other a lot better," Ruder said. "People would know exactly whom to call."

Just as consumers have faith that a $20 bill will be accepted by a retailer, the nation's financial markets are built on faith that its big players won't be broke at the end of the day.

With the stock market in a freefall, a few words from government officials can either wreck that faith or restore it.

Ruder took some of the blame for the crash because of an off-the-cuff remark at midday that Monday about possibly closing the stock market. While only the president could take such a step, investors who were thinking about selling decided they better bail out while they still could.

Similarly, Greenspan, who learned of the market catastrophe when he got off an airplane at 5:45 that night, vowed before the markets opened the next day to make money available to keep the financial system solvent.

The Dow posted a record gain - 102.27 points.

Does anyone know what has gone wrong with the live reporting of metals prices by Kitco? Has Bart posted any messages re this?

Plunge Protection Team

By Brett D. Fromson
Washington Post Staff Writer
Sunday, February 23, 1997; Page H01

It is 2 o'clock on a hypothetical Monday afternoon, and the Dow Jones industrial average has plummeted 664 points, on top of a 847-point slide the previous week.

The chairman of the New York Stock Exchange has called the White House chief of staff and asked permission to close the world's most important stock market. By law, only the president can authorize a shutdown of U.S. financial markets.

In the Oval Office, the president confers with the members of his Working Group on Financial Markets -- the secretary of the treasury and the chairmen of the Federal Reserve Board, the Securities and Exchange Commission and the Commodity Futures Trading Commission.

The officials conclude that a presidential order to close the NYSE would only add to the market's panic, so they decide to ride out the storm. The Working Group struggles to keep financial markets open so that trading can continue. By the closing bell, a modest rally is underway.

This is one of the nightmare scenarios that Washington's top financial policymakers have reviewed since Oct. 19, 1987, when the Dow Jones industrial average dropped 508 points, or 22.6 percent, in the biggest one-day loss in history. Like defense planners in the Cold War period, central bankers and financial regulators have been thinking carefully about how they would respond to the unthinkable.

An outline of the government's plans emerges in interviews with more than a dozen current and former officials who have participated in meetings of the Working Group. The group, established after the 1987 stock drop, is the government's high-level forum for discussion of financial policy.

Just last Tuesday afternoon, for example, Working Group officials gathered in a conference room at the Treasury Building. They discussed, among other topics, the risks of a stock market decline in the wake of the Dow's sudden surge past 7000, according to sources familiar with the meeting. The officials pondered whether prices in the stock market reflect a greater appetite for risk-taking by investors. Some expressed concern that the higher the stock market goes, the closer it could be to a correction, according to the sources.

These quiet meetings of the Working Group are the financial world's equivalent of the war room. The officials gather regularly to discuss options and review crisis scenarios because they know that the government's reaction to a crumbling stock market would have a critical impact on investor confidence around the world.

"The government has a real role to play to make a 1987-style sudden market break less likely. That is an issue we all spent a lot of time thinking about and planning for," said a former government official who attended Working Group meetings. "You go through lots of fire drills and scenarios. You make sure you have thought ahead of time of what kind of information you will need and what you have the legal authority to do."

In the event of a financial crisis, each federal agency with a seat at the table of the Working Group has a confidential plan. At the SEC, for example, the plan is called the "red book" because of the color of its cover. It is officially known as the Executive Directory for Market Contingencies. The major U.S. stock markets have copies of the commission's plan as well as the CFTC's.

Going to Plan A

The red book is intended to make sure that no matter what the time of day, SEC officials can reach their opposite numbers at other agencies of the U.S. government, with foreign governments, at the various stock, bond and commodity futures and options exchanges, as well as executives of the many payment and settlement systems underlying the financial markets.

"We all have everybody's home and weekend numbers," said a former Working Group staff member.

The Working Group's main goal, officials say, would be to keep the markets operating in the event of a sudden, stomach-churning plunge in stock prices -- and to prevent a panicky run on banks, brokerage firms and mutual funds. Officials worry that if investors all tried to head for the exit at the same time, there wouldn't be enough room -- or in financial terms, liquidity -- for them all to get through. In that event, the smoothly running global financial machine would begin to lock up.

This sort of liquidity crisis could imperil even healthy financial institutions that are temporarily short of cash or tradable assets such as U.S. Treasury securities. And worries about the financial strength of a major trader could cascade and cause other players to stop making payments to one another, in which case the system would seize up like an engine without oil. Even a temporary loss of liquidity would intensify financial pressure on already stressed institutions. In the 1987 crash, government officials worked feverishly -- and, ultimately, successfully -- to avoid precisely that bleak scenario.

Officials say they are confident that the conditions that led to the slide a decade ago are not present today. They cite low interest rates and a healthy economy as key differences between now and 1987. Officials also point to SEC-approved "circuit breakers" that were introduced after 1987 to give investors timeouts to calm down.

Under the SEC's rules, a drop of 350 points in the Dow would bring a 30-minute halt in NYSE trading. If the Dow declined another 200 points, trading would cease for one hour. No additional circuit breakers would operate that day, but a new set would apply the next trading day.

Despite these precautions, today's high stock market worries officials such as Fed Chairman Alan Greenspan, who in a speech in early December raised questions about "irrational exuberance" in the markets. Because the market declined following Greenspan's speech, government officials have become even more reluctant to comment on these issues for fear of triggering the very event they wish to forestall, according to policymakers.

A Brewing Concern

Greenspan had expressed similar thoughts a year ago at a confidential meeting of the Working Group. Treasury Secretary Robert E. Rubin and SEC Chairman Arthur Levitt Jr. also are concerned about the stock market's vulnerability, according to sources familiar with their views.

The four principals of the group -- Rubin, Greenspan, Levitt and CFTC Chairwoman Brooksley Born -- meet every few months, and senior staff get together more often to work on specific agenda items.

In addition to the permanent members, the head of the President's National Economic Council, the chairman of his Council of Economic Advisers, the comptroller of the currency and the president of the New York Federal Reserve Bank frequently attend Working Group sessions.

The Working Group has studied a variety of possible threats to the financial system that could ensue if stock prices go into free fall. They include: a panicky flight by mutual fund shareholders; chaos in the global payment, settlement and clearance systems; and a breakdown in international coordination among central banks, finance ministries and securities regulators, the sources said.

As chairman of the Working Group, Rubin would have overall responsibility for the U.S. response, but Greenspan probably would be the government's most important player.

"In a crisis, a lot of deference is paid to the Fed," a former member of the Working Group said. "They are the only ones with any money."

"The first and most important question for the central bank is always, `Do you have credit problems?' " said E. Gerald Corrigan, former president of the New York Federal Reserve Bank and now an executive at Goldman Sachs & Co. "The minute some bank or investment firm says, `Hey, maybe I'm not going to get paid -- maybe I ought to wait before I transfer these securities or make that payment,' then things get tricky. The central bank has to sense that before it happens and take steps to prevent it."

1987: A Case Study

The Fed's reaction to the 1987 market slide, which Corrigan helped oversee, is a case study in how to do it right. The Fed kept the markets going by flooding the banking system with reserves and stating publicly that it was ready to extend loans to important financial institutions, if needed.

The Fed's actions in October 1987 read like a financial war story.

The morning after the 508-point drop on Black Monday, the market began another sickening slide. Corrigan and other Fed officials strongly discouraged New York Stock Exchange Chairman John Phelan from requesting government permission to close the market. Phelan was concerned that if the market continued to erode, the capital of the NYSE member firms would disappear. Corrigan feared a shutdown would cause more panic.

"It was extraordinarily difficult around 11 o'clock," Corrigan recalled. "The market was at one point down another 250 points, and that's when the debate with Phelan took place."

Simultaneously, Corrigan and other central bank officials spoke privately with the big banks and urged them not to call loans they had made to Wall Street houses, which were collateralized by securities that could no longer be traded and whose value was in question.

A final critical moment came that day when the Fed decided not to shut down a subsidiary of the Continental Illinois Bank that was the largest lender to the commodity futures and options trading houses in Chicago. The subsidiary had run out of capital to provide financing to that market.

"Closing it would have drained all the liquidity out of the futures and options markets," said one former top Fed official involved in the decision. Investors use stock futures and options to hedge positions in the underlying stock market.

Recognizing the crucial role of banks if another financial crisis should strike, the Office of the Comptroller recently conducted an internal study of what damage a market decline would inflict on U.S. banks. The OCC declined to discuss the study or its conclusions.

At the SEC, one big worry is how to cope with an international financial crisis that begins abroad but quickly rolls into U.S. markets.

"We worry about a U.S. brokerage firm that is dealing with a Japanese insurance company, where we don't know how they are run or regulated," a SEC source said. To improve its ability to react in a crisis, the SEC and the Fed have begun joint inspections with their British counterparts of U.S. and British financial institutions with global reach.

The most drastic -- and probably unlikely -- move the SEC could take in a crisis would be to propose a market shutdown to the president. That would require a majority vote of the commission. If a quorum couldn't be mustered, the chairman could designate himself "duty officer" and go to the president or his staff.

"Closing the market is, of course, the last thing the commission wants to do," said a source familiar with the SEC's planning. "During a time when people are extremely worried about their investments, you are cutting them off from taking any action. . . . The philosophy of the commission is that markets should stay open."

Just the Facts

Gathering accurate information would be the first order of business for federal regulators.
"Intelligence gathering is critical," Corrigan said. "It depends on the willingness of major market participants to volunteer problems when they see them and to respond honestly to central bank questions."

The SEC, CFTC and Treasury have market surveillance units. They monitor not only the overall markets, but also the cash positions of all the major stock and commodity brokerages and large traders.

The regulators also are hooked into the "hoot-and-holler" system used to notify participants in all financial markets of trading halts. The hoot-and-holler system alerts traders and regulators when a halt is coming.

Relying on Quick Action

In the event of a sharp market decline, the SEC and CFTC would be in constant contact with brokerage and commodity firms to spot early signs of financial failure. If they concluded that a firm was going down, they would try to move customer positions from that firm to solvent institutions.

At least this team of crisis managers already has been through the Wall Street wars. Greenspan was Fed chairman in October 1987. Rubin has served as the co-head of investment bank Goldman Sachs & Co. Levitt has been both a Wall Street executive and president of the American Stock Exchange.

"I think the government is in good shape to handle a crisis," said Scott Pardee, senior adviser to Yamaichi International ( America ) Inc., a Japanese brokerage subsidiary, and former senior vice president at the New York Fed. "A lot depends on personal relationships. You have a number of seasoned people who have gone through a number of crises. So if something happens, things can be handled quickly on the phone without having to introduce people to each other."

Consider what happened at 11:30 p.m. Dec. 5, when Greenspan made his comments about irrational exuberance. Alton Harvey, head of the SEC's Market Watch unit, was called at home by officials of Globex, a futures trading system owned by the Chicago Mercantile Exchange. U.S. stock futures trading in Asia had fallen to their 12-point limit, they said.

Harvey immediately alerted his direct superior as well as his opposite number at the CFTC. More senior SEC and CFTC officials were informed as well. But there wasn't much to be done until the morning. So Harvey went back to sleep.

REACTING TO A PLUNGE

After the market crashed on Oct. 29, 1929:

* The Federal Reserve provided loans and credit to financial systems.

* President Hoover met with business, labor and farm organizations to encourage capital spending and discourage layoffs; he also promised higher tariffs.

* Federal income taxes were reduced by 1 percent by the end of the year.

After the market dropped 22.6 percent on Oct. 19, 1987, the Federal Reserve:

* Encouraged the New York Stock Exchange to stay open.

* Encouraged big commercial banks not to pull loans to major Wall Street houses.

* Kept open a subsidiary of Continental Illinois Bank that was the largest lender to the commodity trading houses in Chicago.

* Flooded the banking system with money to meet financial obligations.

* Announced it was ready to extend loans to important financial institutions.

What would happen today during a stock drop would depend on the particulars. Here are current guidelines:

* If the Dow Jones industrial average falls 350 points within a trading day, NYSE trading would be halted for 30 minutes.

* If the DJIA falls another 200 points that day, trading would stop for one hour.

* If the market declines more than 550 points in a day, no further restrictions would be applied.

 Copyright 1997 The Washington Post

http://www.kitco.ca/gold.live.html

Good articles on the origins of the Working Group and what
it's about. Probably where the euphemism 'plunge protection
team' was coined and since grown to the dimension of urban
legend.

GOLD WILL NOT HAVE ANOTHER DOWN DAY FOR THE REST OF THE YEAR!!

I used to have photo labs & sent the fixer & bleach recovery buckets away for silver recovery..one day i opened a bucket & there was a 1 inch thick crust of silver..I used to take this out & melt myself at home... get a ceramic crucible..build a box out of bricks..surround crucible with B-B-QUE heat beads..start fire..put blower end of vacuum cleaner into fire...presto instant blast furnace..funny thing was,the silver recovery cheque from refiner was only always marginally less with me removing the crusted silver!

Fresh from the press - Reuters - Tue 3:20pm

U.S. stocks higher, financial cos help Dow

U.S. stocks higher late session, financial services cos help lift Dow after Citigroup announces 10,400 job cuts.
*****

This is sick, especially thinking of investors and stock analysts about what it takes to keep stocks up.

Have you read Krugman & Hanke, who have pretty well dicredited all the right wing, economic dogma that is so close to your cold heart?

I expressed my disdain for all of the scumbags of every political persuasian who want to run our lives. You come across a right wing, wacko, fanatical, ideagogue.

Capitalism is just peachy keen...Yeah right! I suppose that the 10 yr old kids who worked 12 hrs a day in the coal mines under "pure capitalism" really enjoyed themselves. But, you, no doubt could rationalize the inhumane opression of the powerless that enabled the robber barons to amass great fortunes.

esoterocist
Phom mai chawp Oh Oh gup poo tee mee nuat.
Khun chawp leu? Peuan sanit korng phom mai sway leuay leh gow mee mia sway leeaw.

http://www.intellectualcapital.com/issues/98/1210/icopinions1.asp

No, you cannot use the lead pot to melt silver. Silver melts over 1000 degrees ( f ) higher than lead, *and* at a higher temperature than aluminum. In the older methods one would use refractory ceramic crucibles with flux and a *very* hot, *very* clean reduction flame to achieve clean melt. But this is now supplanted by more modern techniques which use a closed crucible and induction coils to melt- thus keeping oxidation at a minimum. Oxidation is the chief evil in melting silver, especially sterling as it has a great affinity for oxygen. I believe Bart has a web page link with metal data, ( melt temperatures, specific gravity, etc ) , go to Kitco main page and follow the links.

Refining gold is too complex to explain in a short paragraph, but there are several ways to do it. An old method called cuppelling used lead, bone ash, and nitric acid. There is also aqua regia precipitation and electrolysis. Sometimes cyanide and mercury are used in some stages of ore separation. All the processes are dangerous and could severely injure you because of the toxic chemicals, fumes, or heat. Heavy metal fumes are invisible, and cumulative. Aqua Reqia and Nitric are not gentle substances. Leave stuff like this up to people such as our host Bart Kitner.

co-incident, because it was my biggest all time winner. CTQ was my albatross & the one that made me swear off individual jrs.

Since the cat has yer tongue, to answer the question I posed earlier:

James Carville - well-known Left-Wing Fanatic in the pay of Bill Clinton.

Come on, James, if you be a free-thinker, then Bill Clinton is suitable to teach at a girl's school.

Spud ( deep breath .... ) : GOOOOOOOOOOOOOOOO GOLD!!!!!!!!

Aussie Reserve Bank Governor, Ian Macfarlane has just warned of possible bank runs/panic next year. I like this guy. Definitely not your head in the sand type. Y2K getting heaps of press in Oz right now. I think Oz is taking the right tack by airing the issues and educating the populace.
.................
James/Gusto Oro
G'day guys/gals. Your ( goldbugs in general ) swearing off of juniors tells me we must be at or near a bottom in these shares. What goes from $1.50 to .04 often goes back to $1.50. I am getting HEAVILY involved in a junior that has repeated this pattern 3 times in the past 8 years. HEAVILY, HEAVILY!! It has been scraping the bottom of the trough for several months and has just turned its nose up. That was my signal to jump in. You have to pick a junior that actually HAS something in the ground. Buy when you see white towels flying over the ropes. cheers, N.

we were'nt taught anything about PPTs in economics. Of course, it could never happen in the "pure capitalism" that Hugo is so fond of, but unfortunately does'nt & never did exist.

This mkt manipulation has cost me dearly because of my tech shorts. I just covered the last of them yesterday @ a loss, but not so severe because of the big decline. From now on I'll stand aside until their are huge cracks in the mkt.

I expect this accumulation to be completed by Dec 31,1998. Starting early in 1999,gold will break out of the trading range and begin slowly rising.
I expect gold mining shares to double in 1999 and skyrocket in 2000-2002.
This will be coupled with intensifying deflation and massive layoff's. You gold bugs will be rewarded for your long patience and misery. Just hang in here for a few more weeks. By the end of 1999,you will recoup most of your losses and will be smiling in the year 2000. It takes guts to invest correctly. Unfortunately many of you got in too early.

As I posted earlier--Under capitalism man exploits man: under socialism, the reverse is true.

I have no hope that either system will ever work to the advantage or benefit of the average working individual Therefore my outlook for the human race is pretty grim.

I know that you probably consider yourself to be one of the enlightened ones who will profit & flourish under your present sytem, which can only function by oppressing 100s of milions of people globally. But guess what? This system of exploitation which has recently impoverished all those people in SEAsia, will eventually visit a terrible retribution on your shores. The system which endorses the attack dog tactics of Soros has fatally wounded the golden goose. Those people will no longer permit themselves to be exploited & your Nation of hamburger flippers in your euphemistically described "service economy", will in the not too distant future wake up to the cold hard reality of a new dawn. A nuclear economic winter.

BTW I'm apolitical & havent voted for 20 yrs. Why encourage the bastards.

As I posted earlier--Under capitalism man exploits man: under socialism, the reverse is true.

I have no hope that either system will ever work to the advantage or benefit of the average working individual Therefore my outlook for the human race is pretty grim.

I know that you probably consider yourself to be one of the enlightened ones who will profit & flourish under your present sytem, which can only function by oppressing 100s of milions of people globally. But guess what? This system of exploitation which has recently impoverished all those people in SEAsia, will eventually visit a terrible retribution on your shores. The system which endorses the attack dog tactics of Soros has fatally wounded the golden goose. Eventually, those people will no longer permit themselves to be exploited & your Nation of hamburger flippers, in your euphemistically described "service economy", will in the not too distant future wake up to the cold hard reality of a new dawn. A nuclear, economic winter.

BTW, I'm apolitical & have'nt voted for 20 yrs. Why encourage the bastards?

I have discussed many times on this forum the obvious:

1 ) Timing--pick a chart that looks like a yoyo in action.

2 ) Make sure that they actually HAVE something other than hot air. Preferably precious in the ground. Cash doesn't matter. If they've got the goods, someone will come up with the cash.

And now the SECRET. I have no firm evidence to back up this assertion. Just many years edukation in the 'school of hard knocks'.

Here goes:

3 ) Before buying a junior/wannabe look at the share registry ( available in annual reports in Oz ) . The directors of the company MUST have a substantial shareholding. Simple. Think about it.

The company I am currently loading up on has:
1 ) a graph like it was made in a yoyo factory.
2 ) a humungous deposit of Au/Ag only partly explored.
3 ) Two of the directors combined own 30% of the shares.

Now an added advantage is that in Oz a director must disclose his purchase/sales of shares in his company. When THEY sell, I sell !!!!!!

Hope this makes some of you some moolah. It sure has for me. Cheers, Nick.

COMEX Metal Warehouse Statistics for Dec. 15

-- TOTALS
Gold 811,666 - 14,069 troy ounces
Silver 76,916,402 - 1,254,117 troy ounces
Copper 87,798 + 967 short tons

Here is a visual of the Primary trend of the Dow decide for yourself if its up down or in transition.

Dow/Gold Ratio = 30.15. The 233 day moving average is 29.29

Never seen a crooked mine or a crooked horse. You are so right.
Bet on the driver.

A CONVENIENT EXCUSE: The financial media seem to have latched upon President Clinton's impeachment hearings as a reason for the stock market's recent decline, as though sky-high P/E ratios, historically low put-call ratios, and a classic technical double top are just various flavors of chopped liver. Don't believe it for a moment: if you don't have large rocks poised at the edge of a cliff atop smaller ones, melting snow cannot cause an avalanche!

http://www.goldminingoutlook.com/

XAU/Spot Ratio = .227. The 233 day moving average is .248

http://www.kitco.ca/cgi-bin/livetop.cgi?SHOWMODE=AUTO

this is Bart's prices with the ".com" changed to ".ca"...finally.

We watch this sh*t market together. Yes. Actually, I'm buying...a little here...a little there...juniors too...thanks Nick...

Tom

http://www.sightings.com/ufo2/sfpower.htm

http://www.kitco.ca/cgi-bin/livetop.cgi?SHOWMODE=AUTO

Bart said his ISP changed the ".com" to ".ca"

Tom

change the ".kitcomm." to "kitco." So it is: http://www.kitco.ca/cgi-bin/livetop.cgi?SHOWMODE=AUTO

Tom

T. Jefferson's timeless perspective, & wisdom ( -below: ) ,
confirm my unending recommendation, for you, and everyone
you love, care for, and know:

"dollar-cost-average your savings into purchases of gold coins,
and into gold mining stocks, &/or funds, when suitable."
.......

THOMAS JEFFERSON:

"Paper is poverty,... it is only the ghost of money,
and not money itself."
--Thomas Jefferson to Edward Carrington, 1788. ME 7:36

"Experience has proved to us that a dollar of silver disappears
for every dollar of paper emitted."
--Thomas Jefferson to James Monroe, 1791.


"It is a [disputed] question, whether the circulation of paper,
rather than of
specie, is a good or an evil... I believe it to be one of those
cases where
mercantile clamor will bear down reason, until it is corrected by
ruin."
--Thomas Jefferson to John W. Eppes, 1813. ME 13:409

Specie as a National Resource

"In such a nation [as ours], there is one and one only resource for
loans,
sufficient to carry them through the expense of a war; and that
will always be
sufficient, and in the power of an honest government, punctual in
the
preservation of its faith. The fund I mean, is the mass of
circulating coin.
Everyone knows, that although not literally, it is nearly true,
that every paper
dollar emitted banishes a silver one from the circulation. A
nation, therefore,
making its purchases and payments with bills fitted for
circulation, thrusts an
equal sum of coin out of circulation. This is equivalent to
borrowing that sum,
and yet the vendor receiving payment in a medium as effectual as
coin for his
purchases or payments, has no claim to interest. And so the nation
may
continue to issue its bills as far as its wants require, and the
limits of the
circulation will admit... But this, the only resource which the
government could
command with certainty, the States have unfortunately fooled away,
nay
corruptly alienated to swindlers and shavers, under the cover of
private
banks." --Thomas Jefferson to John W. Eppes, 1813. ME 13:274

"One of three great measures necessary to insure us permanent
prosperity...
should insure resources of money by the suppression of all paper
circulation
during peace, and licensing that of the nation alone during war.
The metallic
medium of which we should be possessed at the commencement of a
war,
would be a sufficient fund for all the loans we should need through
its
continuance; and if the national bills issued be bottomed ( as is
indispensable )
on pledges of specific taxes for their redemption within certain
and moderate
epochs, and be of proper denominations for circulation, no interest
on them
would be necessary or just, because they would answer to everyone
the
purposes of the metallic money withdrawn and replaced by them."
--Thomas
Jefferson to William H. Crawford, 1816. ME 15:30

"It would be best that our medium should be so proportioned to our
produce,
as to be on a par with that of the countries with which we trade,
and whose
medium is in a sound state." --Thomas Jefferson to John W. Eppes,
1813. ME
13:430

Dangers of Paper Money

"That paper money has some advantages is admitted. But that its
abuses also
are inevitable and, by breaking up the measure of value, makes a
lottery of all
private property, cannot be denied. --Thomas Jefferson to Josephus
B. Stuart,
1817. ME 15:113

"The trifling economy of paper, as a cheaper medium, or its
convenience for
transmission, weighs nothing in opposition to the advantages of the
precious
metals... it is liable to be abused, has been, is, and forever will
be abused, in
every country in which it is permitted." --Thomas Jefferson to John
W. Eppes,
1813. ME 13:430

"Scenes are now to take place as will open the eyes of credulity
and of
insanity itself, to the dangers of a paper medium abandoned to the
discretion
of avarice and of swindlers." --Thomas Jefferson to Thomas Cooper,
1814.
ME 14:189

"The States should be applied to, to transfer the right of issuing
circulating
paper to Congress exclusively, in perpetuum." --Thomas Jefferson to
John
W. Eppes, 1813. ME 13:276

"The evils of this deluge of paper money are not to be removed
until our
citizens are generally and radically instructed in their cause and
consequences, and silence by their authority the interested clamors
and
sophistry of speculating, shaving, and banking institutions. Till
then, we must
be content to return quoad hoc to the savage state, to recur to
barter in the
exchange of our property for want of a stable common measure of
value, that
now in use being less fixed than the beads and wampum of the
Indian, and to
deliver up our citizens, their property and their labor,
passive victims to the
swindling tricks of bankers and mountebankers." --Thomas Jefferson
to John
Adams, 1819. ME 15:185

"Private fortunes, in the present state of our circulation, are at
the mercy of
those self-created money lenders, and are prostrated by the floods
of nominal
money with which their avarice deluges us." --Thomas Jefferson to
John W.
Eppes, 1813. ME 13:276

"It is a cruel thought, that, when we feel ourselves standing on
the firmest
ground in every respect, the cursed art of our secret enemies,
combining with
other causes, should effect, by depreciating our money, what the
open arms of
a powerful enemy could not." --Thomas Jefferson to Richard Henry
Lee,
1779. ME 4:298

"I now deny [the Federal Government's] power of making paper money
or
anything else a legal tender." --Thomas Jefferson to John Taylor,
1798.

Garbagerelli was on CBNC today & said that the Dow can get to 11000 even though earnings will be flat to down next year.

I'm almost convinced. It seems that the manipulators/mkt mkrs, etc are firmly in control.

I covered my shorts yesterday, but can't quite pull the trigger on a long. Maybe I'll try an S&P mini.

I appreciate your updates.

The fact that your right has nothing to do with posting the truth.

Keep up the education. Dishonest money is the root of the "evil". We wait and watch.;- )

Tom

I reread it...does not make a lot of sense but I hope you know my true THOUGHTS...a lesson in currency ( money ) is to be learned by this generation...not pretty.

Tom

as always, a poetic, erudite, and digified apostle of the truth.
Thanks for your wisdom, and President Jefferson's insight.

David - as always, a poetic, erudite, and digified apostle of the truth.
Thanks for your wisdom, and President Jefferson's insight.

I seem to have made my point

David...as always, a poetic, erudite, and digified apostle of the truth.
Thanks for your wisdom, and President Jefferson's insight.

I like your oil picks...yes.

Tom

do not shoot the messenger if she brings you news you do not wish to hear. There are few as bullish on or as devoted to gold as I ( I look for gold in the THOUSANDS of dollars in the new century...EARLY ) but I also say that it is not out of the question for the Dow to reach 12000 ( I see Elaine's 11000, and I raise her a thousand! ) .

There are still exciting plays in non-gold stocks around. The end may be "near" but not quite at hand yet. I am just as amazed as you, but the market is always right.

If you like my oil picks, you'll love my COPPER pick - OKP. Check it out. The astrologicals aren't exactly what I usually look for, but the value is very nice now, the price chart is super- tempting, and I think copper is bottoming NOW !

Also, if you are in a real reckless mood, CNPGF might be very interesting right now, as gold gets ready to rally to 370 by Spring. But this is muy dangeroso. No pain no gain. But not for the faint of heart.

10000...yup...oh that felt good to say...the trend is not your friend today or for a long time...

Thanks for the interesting Jefferson quotes--I bookmarked your entry for future reference. --Al

Brazil. He said that the situation there is very precarious. Most of the establishment are convinced that they can get the IMF funds without carrying out Draconian measures. There could be a major problem though. One of Cardosa's main supporters is very ill with bladder CA & may have to step down fairly soon. He said that there will panic in the streets if there is a devaluation over 15%.

I still don't think that AG & his cohorts be able to contain the damage that will ensue from the lack of investor confidence. Spreads will widen & some major G7 Banks be seriously crippled.

Sure hope your right on Copper, not many bulls around right now. Teck Corp. is into Gold/Copper/Coal etc., and the stock has been ravaged lately. Yep, 370. AU in the spring would be nice.
It seems that the hardest hurdles to clear will be 305. and 325., and after that the gains should come easy......

The only thing slower than the rise of gold is your server!

short-term market's
final sell-off in the Dow, and U.S. stocks,
may be just ahead...
as negative press regarding Prez C., & impeachment-buzz...
( and other negative news coverage.... )
reach a crescendo......just ahead....

A few words of timeless wisdom,
from a founding father of the good ole USA,
might be well considered, and pondered....
in these perilous times:
T. Jefferson, on 'paper money', and 'passive victims' ...... )
ID#434108:
Copyright  1998 goldfevr All rights reserved
"Paper is poverty,... it is only the ghost of money, and not money
itself."
--Thomas Jefferson to Edward Carrington, 1788. ME 7:36

"Experience has proved to us that a dollar of silver disappears for
every
dollar of paper emitted." --Thomas Jefferson to James Monroe, 1791.
ME
8:208

"It is a [disputed] question, whether the circulation of paper,
rather than of
specie, is a good or an evil... I believe it to be one of those
cases where
mercantile clamor will bear down reason, until it is corrected by
ruin."
--Thomas Jefferson to John W. Eppes, 1813. ME 13:409

Specie as a National Resource

"In such a nation [as ours], there is one and one only resource for
loans,
sufficient to carry them through the expense of a war; and that
will always be
sufficient, and in the power of an honest government, punctual in
the
preservation of its faith. The fund I mean, is the mass of
circulating coin.
Everyone knows, that although not literally, it is nearly true,
that every paper
dollar emitted banishes a silver one from the circulation. A
nation, therefore,
making its purchases and payments with bills fitted for
circulation, thrusts an
equal sum of coin out of circulation. This is equivalent to
borrowing that sum,
and yet the vendor receiving payment in a medium as effectual as
coin for his
purchases or payments, has no claim to interest. And so the nation
may
continue to issue its bills as far as its wants require, and the
limits of the
circulation will admit... But this, the only resource which the
government could
command with certainty, the States have unfortunately fooled away,
nay
corruptly alienated to swindlers and shavers, under the cover of
private
banks." --Thomas Jefferson to John W. Eppes, 1813. ME 13:274

"One of three great measures necessary to insure us permanent
prosperity...
should insure resources of money by the suppression of all paper
circulation
during peace, and licensing that of the nation alone during war.
The metallic
medium of which we should be possessed at the commencement of a
war,
would be a sufficient fund for all the loans we should need through
its
continuance; and if the national bills issued be bottomed ( as is
indispensable )
on pledges of specific taxes for their redemption within certain
and moderate
epochs, and be of proper denominations for circulation, no interest
on them
would be necessary or just, because they would answer to everyone
the
purposes of the metallic money withdrawn and replaced by them."
--Thomas
Jefferson to William H. Crawford, 1816. ME 15:30

"It would be best that our medium should be so proportioned to our
produce,
as to be on a par with that of the countries with which we trade,
and whose
medium is in a sound state." --Thomas Jefferson to John W. Eppes,
1813. ME
13:430

Dangers of Paper Money

"That paper money has some advantages is admitted. But that its
abuses also
are inevitable and, by breaking up the measure of value, makes a
lottery of all
private property, cannot be denied. --Thomas Jefferson to Josephus
B. Stuart,
1817. ME 15:113

"The trifling economy of paper, as a cheaper medium, or its
convenience for
transmission, weighs nothing in opposition to the advantages of the
precious
metals... it is liable to be abused, has been, is, and forever will
be abused, in
every country in which it is permitted." --Thomas Jefferson to John
W. Eppes,
1813. ME 13:430

"Scenes are now to take place as will open the eyes of credulity
and of
insanity itself, to the dangers of a paper medium abandoned to the
discretion
of avarice and of swindlers." --Thomas Jefferson to Thomas Cooper,
1814.
ME 14:189

"The States should be applied to, to transfer the right of issuing
circulating
paper to Congress exclusively, in perpetuum." --Thomas Jefferson to
John
W. Eppes, 1813. ME 13:276

"The evils of this deluge of paper money are not to be removed
until our
citizens are generally and radically instructed in their cause and
consequences, and silence by their authority the interested clamors
and
sophistry of speculating, shaving, and banking institutions. Till
then, we must
be content to return quoad hoc to the savage state, to recur to
barter in the
exchange of our property for want of a stable common measure of
value, that
now in use being less fixed than the beads and wampum of the
Indian, and to
deliver up our citizens, their property and their labor,
passive victims to the
swindling tricks of bankers and mountebankers." --Thomas Jefferson
to John
Adams, 1819. ME 15:185

"Private fortunes, in the present state of our circulation, are at
the mercy of
those self-created money lenders, and are prostrated by the floods
of nominal
money with which their avarice deluges us." --Thomas Jefferson to
John W.
Eppes, 1813. ME 13:276

"It is a cruel thought, that, when we feel ourselves standing on
the firmest
ground in every respect, the cursed art of our secret enemies,
combining with
other causes, should effect, by depreciating our money, what the
open arms of
a powerful enemy could not." --Thomas Jefferson to Richard Henry
Lee,
1779. ME 4:298

"I now deny [the Federal Government's] power of making paper money
or
anything else a legal tender." --Thomas Jefferson to John Taylor,
1798.

Here's an interesting situation. When I use this URL

http://www.kitcomm.com/comments/goldlive/index.html

I get Kitco's discussion group ( framed ) but not the price quotes

When I use this URL

http://www.kitco.ca/comments/goldlive/index.html

I get the same frames, but this time I get the quotes but none of the discussion postings.

Are you in transition to a new Server, Bart?

According to his biographer, Thomas Jefferson was almost always in debt even after owning land. However, as president, he was able to pay off all of the national debt, until he bought Louisiana.
The lesson is: If you're not in debt, you can gamble when the real thing comes along.

PS. My market indicators tell me we are in a definite buy condition, today, which resembles the start of many previous gold rallies. If it doesn't launch within four days, abort and return to hangar.

I see you made the exclusive "Triple Post Club" back there. Were you already a member ? Any chance of finding a little time to ponder my little Astroquestion email ? : )

Joking apart...

There's something wrong of course in Kitcoland....I can't get to these pages except by my link direct to Discussion Group page. I have to skip the front page which just looks at me blinking...

this year. Investors will remain locked in a fund, like it or not."
-------------------------------------------------------------------------
http://www.azcentral.com:80/business/1215djnhedge15.shtml

SWC up today on heavy than normal volume. The short squeeze is
about to hit.Forward selling is not forseen in the near future.
Cough it it up Mr. Bigtime and deliver.

The worst is behind us - hang on and hang in there - gold is going up and is finally starting to look a lot better. Hopefully by Christmas PMs will be clearly in an up trend.

WASHINGTON ( AP ) -- The International Monetary Fund approved another $957 million in credit for Indonesia Tuesday, noting encouraging signs of the country's progress in resolving its economic crisis.

http://www.newsday.com/ap/rnmpne0w.htm
--
Indonesia has not been a good "IMF beneficiary" as it's put all kinds of currency controls in place and generally hasn't done what it was told to do by the IMF. But then, it must be doing something right.

Millions of people in Pennsylvania, New Jersey, Virginia, Maryland and Delaware are being asked to shorten their showers and find ways to conserve water because of drought in the mid-Atlantic region. Recent storms have just missed bone-dry areas or did little to ease the drought that began last summer.

http://www.newsday.com/ap/rnmpne1m.htm
--
To add a little authenticity to this, I'm in Virginia, we need rain.

WASHINGTON ( AP ) -- Nearly 48 million Americans will pay zero income taxes for 1998, thanks in large part to the new $400-a-child tax credit, according to a congressional study released Tuesday. At the same time, the Joint Committee on Taxation estimated that people at the higher end of the income spectrum -- above $100,000 a year -- will shoulder 62 percent of the 1998 income tax burden, compared with 56 percent the year before.

http://www.newsday.com/ap/rnmpfn18.htm
--
Socialists: 1, Civil Libertarians: 0

Heard on the radio
A chain of American Department Stores is returning a shipment of "fur-lined" parkas back to China. It turns out that the "fur" is not "cayote" but rather of the domestic dog.

It has been suggested that the stores missed a golden opportunity to re-label the parkas as "Barkers"

Anyone else see the irony? The word "parka" is Innuit.

to get onto this discussion group only via the board that lists the 3 discussion groups. Nothing else worked no matter what I tried and many things came up url unknown. I was desperate for my Kitco fix - an addict for sure. PMs are looking good tonight - Go golf !

We only lost 10900 jobs today, down from the 18900 on Monday.

Citigroup Plans 10,400 Job Cuts
http://www.newsday.com/ap/rnmpfn00.htm
LA Times To Eliminate 500 Jobs
http://www.newsday.com/ap/rnmpfn06.htm

TOKYO ( AP ) -- Japan's broadest measure of trade rose again in October, increasing 21.5 percent from a year ago, the government announced Wednesday. The current account surplus, unadjusted for seasonal factors, was at $11.4 billion in October, the Finance Ministry announced. The rise marked the 19th consecutive monthly year-on-year increase in the surplus. The current account measures the difference between income from foreign sources and foreign obligations payable, excluding net capital investment. Japan has come under increasing pressure to revive its sluggish economy to import more goods and cap the ballooning surplus.

http://www.newsday.com/ap/rnmpfn0d.htm
--
To me, this is one of the four most important things going on and is a very important bit of news. What are the four most important things going on in world economics ? Who cares about Brazil, nobody. That story is already written and is just waiting out there for the world to read it. The four most important things are: 1 ) Japan's HUGE trade surplus, because if that ever changes, she's toast and everybody knows it. This trade surplus is the thing that is keeping Japan alive. 2 ) The high dollar, because when that changes, the "sell America" light comes on and foreign folks will flee this country like we're on fire. 3 ) Consumer spending in the United States, because everyone knows what happens when that changes, and 4 ) the ever-falling price of commodities.

Good Tax the RICH it is the govt money keeping their ponzi scheme alive. Also the poor pay for medicare and social security taxes and the rich dont pay on SS over 68K. Save me the crodile tears for the better off, they have never had it so good though its looks like their fate will change soon. To this I salute and GULP AND PUFF TO YA... The times they are a changin' agin' for the more progressive. In fact Clinton's impeachment is a victory for the TRUE LEFT as he is a DLC er and only someone dishonest could be. ONWARD IMPEACHMENT. As a Democratic Socialist I am to the left of most Dems ECONOMICALLY..I am with Ralph Reed of the CC on most social issues and anti abortion..Lets be done with Clinton or so damage him he is useless his extremist pro permissive on the social agenda is dangerous. He is also probably behind the scheme to maintain the FALSE market..He is truly evil....as such in this world he may yet triumph..though the Lord's patience hopefully has limits.

Good Tax the RICH it is the govt money keeping their ponzi scheme alive. Also the poor pay for medicare and social security taxes and the rich dont pay on SS over 68K. Save me the crodile tears for the better off, they have never had it so good though its looks like their fate will change soon. To this I salute and GULP AND PUFF TO YA... The times they are a changin' agin' for the more progressive. In fact Clinton's impeachment is a victory for the TRUE LEFT as he is a DLC er and only someone dishonest could be. ONWARD IMPEACHMENT. As a Democratic Socialist I am to the left of most Dems ECONOMICALLY..I am with Ralph Reed of the CC on most social issues and anti abortion..Lets be done with Clinton or so damage him he is useless his extremist pro permissive on the social agenda is dangerous. He is also probably behind the scheme to maintain the FALSE market..He is truly evil....as such in this world he may yet triumph..though the Lord's patience hopefully has limits.

Does anyone have Oleman's market comments for this evening ?

I've seen Greenstone Resources recommended by a couple of
noteworthys. I would like to know what their resource base
is as far as ounces and grade. I couldn't find their website.
I did obtain some financials from the Nasdaq site.

Goldfevr - can't we hold the length of these posts down to
something more reasonable?

Nick@C - I read your post regarding the junior you were loading
up on. Since you've established a nice position, couldn't you
at least mention the name of the stock rather than just tease us?
Besides, now you need some volume.

I have looked at composite totals of
government ( States, Counties, Cities and Federal ) for 10 years now, and
here is what I have totaled:

1. Stock ownership, composite totals............. = to: $32 Trillion +
2. Insurance Company equity participation........ = to: $8 Trillion +
3. Bond surety investment accounts............... = to: $5.5 Trillion +
4. Totals from all liquid investment funds....... = to: $60 Trillion +

The personal income from everyone in the USA ( pre tax 1996 ) is = to 6.5
Trillion. In other words if every person living in this country gave every
cent they made to government for 10 years, it would equal what composite
government has amassed in their investment accounts, as of TODAY.. Have You
Gotten Your Wake Up Call...???

The corruption feeds off the revenue. Expose the revenue structure, and the
beast dies of starvation. There are only a few thousand of them compared to
many millions of us....

Rip the head off the corruption, and the body dies....

The Equivalent of the Comprehensive Annual Financial Report ( CAFR ) for the
composite totals of the majority of Federal Government agencies is called
the Federal Government Combined Financial Statement.

To download the US Federal Government Combined Financial Statements for
1997, 96 & 95 go to this site: http://www.fms.treas.gov/cfs/index.html

Read the last page first. It shows what agencies are included in the
combined statement and those that are excluded. You will see the ones
excluded from the report as being the primary cash and investment agencies.
Are they worried that if they were included that the balance sheet would
show positive assets in the trillions ?? hmmm...

To see the requirement recommendation submitted by GFOA to the Feds in 1979
of which was enacted in 1982 through transmittal letter 1, requiring local
governments ( City, County and States ) not already having a CAFR to prepare a
CAFR report go to this Internet site:
http://www.financenet.gov/data/welcome/statloc/prof/gfoa/policies/accounting
.g op

To get some of the City, County and State CAFR reports available for
downloading go to this Internet site:
http://financenet.gov/financenet/state/cafr.htm

If your State or County is not listed, send an E-Mail to a neighboring State
saying that you have their State CAFR report, and you would like to do a
comparison study of your State's CAFR report, and would they please E-Mail
you back with the department, telephone number and contact name in YOUR
State + Counties + large Cities to get their CAFR report. The States all sha
re each others CAFR reports for comparison..

The foundation of the Corruption is starting to quiver based on the fact
that the word is getting out quickly...as to "The biggest game in
town"......

Both the News Media and Governments dilemma here, that will clearly expose
them, is that the citizens are not looking for the needle in the haystack
but the haystack sitting on the needle. Qualify what the forest is, and stop
looking at the leaves in the forest.. What is important here is
understanding the principle of operation that has lead to this financial
takeover. When seen you will understand the motives and propaganda that is
rammed down your throat by the News Media and Government which keeps you
looking in right field as they conduct their criminal business as usual
activities in left field.

The "CAFRs" shows the created through restriction by statute revenue
structure which allows the wolves to walk among the sheep in obscurity, as
they devour the sheep, fulfilling their appetite in a orgy of
neo-capitalistic gluttony. With the surviving sheep saying "what happened",
"who were they", "is something wrong", "there is a problem here, but we just
can't put our finger in it"...

To date, I have been contacted by many from across the Land who now have
been unified through disclosure for one common purpose " making the citizen
the beneficiary of the wealth" not those "Sharp Little Crackers".

Yours Truly,
Walter J. Burien, Jr.
P.O. Box 11444
Prescott, Arizona 86304

E-Mail: cevi2000@aol.com
Tel.# 520 445-3532

To All and especially Mooney,
Just wanted to tell all how great the Saturday Night in TO Kitco meet was again! Great food, great conversation, great people. A good and informative time for all. Many thanks to our great organizer and special thanks to Aly for sharing his wit, wisdom and investor stories and to all the other great people who came out. Farmer, 6Pak, Rudy and the rest, you know who you are! I hope to meet you all again in the spring. Any chance we can lure more kitcoites out next time?
BTW, what does everybody think of the drubbing Placer Dome Gold has taken in the past few days? I think it's a good buying opportunity. Comments?
MofromTo

ROR, you said: "Good Tax the RICH it is the govt money keeping their ponzi scheme alive. Also the poor pay for medicare and social security taxes and the rich dont pay on SS over 68K. Save me the crodile tears for the better off, they have never had it so good though its looks like their fate will change soon."

I think you mean the "well off", not the rich. The "well off" folks are paying taxes from here to eternity. The truly rich don't pay taxes except on the money they need at the moment in any particular country as their money is well beyond the reach of those who would take it from them. The really real money moves around the world at will and does so tax free. 'Tis the way the world works, always has, always will.

Tuesday December 15, 10:01 pm Eastern Time

NY Fed-central bank cooperation to avert deflation

NEW YORK, Dec 15 ( Reuters ) - Cooperation among central banks will eliminate the risk of global deflation, Federal Reserve Bank of New York President William McDonough said on Tuesday.

``There is enough cooperation, and I'm not saying coordination, but cooperation among the central banks that I think the chances of ( global deflation ) are zero,'' McDonough said at a lecture series on America's Economic Future.

( Note: this article is ``in progress''; there will likely be an update soon. )

Uh, Bart, that popdown menu still only shows two years for selection. 97 and 98. I think we're gonna need a new one pretty soon. Once again, you might ask that programmer if he'd consider a change to a 4 digit format so this doesn't happen every year. Hate to keep harping on this but I need my Kitco fix every day and the time just keeps slipping away...;- )

Great observation and name! Kitco's Y1.999K problem. Aren't we goldbugs supposed to be ahead of the curve? It really is ironic that with all the talk on Kitco of the end of the world with Y2K and nobody except you has noticed our own little computer problem staring us right in the face!

100 Reasons to Buy Gold:
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold:
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold:
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

100 Reasons to Buy Gold
Upgrading Barrick, Normandy and Prime Resources to Outperform
by Douglas M. Cohen,
Morgan Stanley Dean Witter, New York

Part II - 100 Reasons to Buy Gold and Gold Equities

I. Good Times Don't Last Forever



1.MSDW strategist Byron Wien Dow forecast 2H98= as low as 7000; market presently 17% overvalued.
2.MSDW global strategist Barton Biggs forecast= a possible "ice storm" ahead, with 1998 as a year of "sack cloth and ashes" amidst an economic slowdown.
3.MSDW chief economist Steven Roach 2H98 forecast= 30Yr bond rate of 6.5-7.0%, inflation around 3% ( increasing to 3.6% in 1999 ) .
4.MSDW strategist Peter Canelo= recent expansion of U.S. money supply and credit is highly reminiscent of 1993 ( when the XAU doubled ) .
5.The 1980 gold price to Dow ratio was 1:1; now 30:1.
6.Gold stocks have very low betas and have tended to outperform in market declines. Insurance for your financial portfolio.
7.For the true fatalists, remember that Homestake was the top-performing stock during the Great Depression ( up over 700% ) .
8.Worried about deflation? Gold has tended to outperform in periods of severe deflation, when public faith in the monetary system erodes ( usually following a speculative bubble ) .
9.$250 billion flowed into equity and bond funds in 1997 alone. Total assets of gold-oriented funds are roughly $5 billion-potential avalanche of funds into the gold sector when the 15 year-plus bull market finally cracks.
10.The funds are becoming scared to stay short given the amount of bad news "successfully" absorbed by gold since late 1997 ( e.g., Asian dishoarding, Belgian gold sale, low inflation consensus, record run in equities ) .
11.Several unrecognized inflation factors ( e.g., MSDW above consensus oil price forecast of $18.75/barrel in 1998, Steve Roach's output-gap and wage-related arguments ) .
12.The strong dollar won't last ( trade deficit, fear of Asian over-reliance on the U.S. ) . 13.Commodities beginning to come back into favor, including oil from its $13 per barrel low.
14.Gold's decline is cyclical, not secular. No better buy signal than the recent plethora of "Is Gold Dead?" articles.
15.The blood is already in the streets-the seemingly "irrational exuberance" in stocks has been offset with "irrational despondence" toward gold.
16.Gold has served essentially the same role in the world for over 2500 years. Tigers, Spiders and other species for a lot less.
17.Faith in alternative safe havens such as U.S. Treasuries won't last forever ( perhaps not even the summer ) .
18.When the next crisis hits ( be it something "unpredictable" or something already lurking such as the Year 2000 problem ) , investors will put some of their debt and equity profits into precious metals.



II. The Central Bank Picture is Brightening



19.The "big 3" of EMU ( Germany, France and Italy ) are strong gold supporters. It's possible that gold sales from the ECB will be "prohibited" for several years at the insistence of these three countries.
20.Eighty-five million Germans are concerned that their currency is disappearing and want a solid Euro backed with gold.
21.Most gold not contributed to the ECB will likely not be sold, but will be held as insurance in case the ECB fails.
22.Total official gold holdings are down by 10% in the last 30 years; 1% in 1997.
23.Jean Claude Trichet, a gold stalwart, is a potential ECB head.
24.The countries most often considered "at risk" for sales, the Dutch and the Portuguese, may have already sold. The market has already acknowledged this and won't be surprised if/when a sale is announced.
25.The Europeans want a strong Euro; gold still perceived politically, if not economically, as a source of strength.
26.It is highly uncertain that a proposed Swiss sale of up to 45 Moz will go through; a sale would require a public referendum in 1999/2000 and support is not high. 27.Consensus view: ECB gold backing of the Euro of perhaps 10% at most; our view is 15% or higher ( recently supported by an estimate from the Bank of Italy of at least 30% ) . 28.More central banks have bought than sold the last two years.
29.Asian governments are underweight gold-do they want to be dependent on the U.S. dollar?
30.China and Russia have been true to their word in escalating their gold purchases. 31.The U.S., the world's largest holder is unlikely to sell ( especially with Greenspan in charge ) .
32.Only Canada and Argentina have had programs in place to sell virtually all their gold. 33.The silence of the central banks during the 1997 plunge in gold led to losses of over $50 billion for the gold holding countries; they have learned their lesson.
34.Central bank selling has been a regular feature of the gold market for the past 20 years, averaging around 400 tonnes per annum; virtually identical to most estimates of the amount sold in 1997.



III. The Worst is Over for Asia ( for Gold Anyway )



35.The Southeast Asian crisis may well have stabilized, less currency devaluation-inspired dishoarding of gold.
36.The economic crisis took almost $60/oz off of the gold price by some estimates ( we'd say more like $20-30 ) ; the impact should be temporary.
37.South Korean collection program largely over ( after raising over 230 tonnes ) . 38.Thailand's collection program has reportedly met with little success.
39.In the long term, the Asian crisis will re-establish gold's role as an unrivaled store of value; gold held its value while currencies plunged 70% or more.



IV. Increasingly Positive Supply and Demand Balance



40.Gap between physical supply and demand was 500 tonnes in 1997 ( and growing ) . 41.Markets don't continue in deficit forever-similar enticement as silver.
42.Gold demand is running at record levels ( up 9% in 1997 ) , even with the Asian dishoarding that now seems to have its course.
43.Demand in India, the world's largest gold market rose 52% in 1997 and continues to sizzle according to the World Gold Council.
44.Liberalization of the gold markets in India and China continues to increase, providing increased access to populaces with a high gold affinity.
45.A possible rally in oil prices= increased income in the Middle-East= increased spending on luxury items such as gold.
46.Mutual funds may be all the rage, but they can't fill a cavity ( dental use of gold holding up well ) .
47.The rally off of 18 year lows of $278/oz in January has revived fabrication demand-fabricators had been running down inventory in anticipation of lower prices. 48.Production from the largest gold producing country, South Africa, is mired at a four decade low; average cash costs of $300/oz are the worlds highest.
49.Environmental and permitting restrictions are becoming increasingly burdensome in North America and Australia; lower supply in the future.
50.Up to 70% of the world's gold production is uneconomic on a total cost basis at $300/oz gold; lower supply in the future
. 51.Word-wide exploration activity is down significantly; lower supply in the future. 52.Mine closures/reductions increasing ( e.g., Mount Todd, Lupin, Homestake, McCoy Cove, Paddington, Colomec, Hope Brook, Freegold ) .
53.Mid-1997 labor accord in South Africa has cleared the way for labor reductions and shaft closures.
54.Record mine supply was artificially high in 1997 due to high-grading-the high grading was done at the expense of mine lives and is largely unsustainable.
55.There have been few major technological breakthroughs in gold mining since heap leaching in the 1980's; none appear to be on the horizon.



V. Producers are Beginning to Take Action



56.The gold producers emerged from the World Economic Forum at Davos convinced that their message got across ( for both selling and lending ) .
57.Former Canadian prime minister Brian Mulroney and former Bank of Canada governor John Crow are actively lobbying on behalf of the producers for central banks to stop selling gold.
58.Peter Munk now bullish after having correctly predicted gold to $280/oz in early 1997; ABX share buy-back program announced, Munk replaced ABX shares sold by TrizecHahn shares with fresh purchases.
59.A potential millennium coin, presently under consideration, could raise investment demand by over 1000 tonnes, according to some estimates.
60.Producers have hinted at a new gold advertising campaign modeled after DeBeer's "diamonds are forever" ( our early nominee has Dana Carvey reprising his role as Saturday Night Live's ChurchLady with a "gold, isn't that precious?" tag line, but we're working on others ) .
61.Junior miners and exploration companies running out of cash; joint ventures with seniors on the rise.
62.Producer buy-backs of hedged positions have increased ( e.g., Western Mining, Newmont, Kinross, Western Areas ) 
63. with 30 Moz more as future possibilities from Ashanti, Barrick, Newcrest, Normandy, and Placer Dome alone.



VI. Good Value in Gold Equities



64.Consolidation opportunities, especially if producers get nervous that prices are headed higher.
65.Valuations now reasonable for several producers on a cash flow and asset value basis. 66.XAU still 50% off of 1996 peak; S&P 500 is up 85% from its 1996 low.
67.Possibility of a major Arequipa or Diamond Fields-type discovery to remove the Bre-X stigma and revive interest in junior's.
68.The decline in gold equity values in 1997 was largely indiscriminate; each of the 40 major companies we track lost value, with most ( hedged or unhedged ) down 45-60%. 69.We believe many gold-oriented producers ( e.g., Prime, TVX, Placer Dome, Barrick, Echo Bay ) could benefit significantly if silver resumes its 1998 rally.
70.TVX- Should go from 400 koz at $223/oz in 1997 to 1000 koz at 180/oz in 2001 if Greek mines meet expectations.
71.Freeport- World's best mine ( in our view ) at 45% off of 1997 high, 30% below implicit asset value before any future reserve additions.
72.Newmont- Lowest cost major producer at present, major long-term growth potential in low-risk Nevada.
73.Prime Resources- Trading at below fair asset value in existing reserves, major "blue sky" growth potential from highest-grade ore body in North America.
74.Normandy- Largest Australian producer has cut costs significantly, looking to grow with support of $625 million hedge book.
75.Barrick- Marquee name in the sector; growth about to resume after four flat years; declining costs as well.
76.Cambior- Eight key projects, seven of which require higher prices; gold is 80% of revenue, but stock trades at a base metal multiple ( 5 times 1999E CEPS ) .
77.Nine of the 14 stocks in our gold universe show good value based on 1999E reserves and a $325/oz gold price; 13 of the 14 show good value at $350/oz.
78.Gold equities are a call on the gold price; typical beta of around 3 relative to bullion. 79.The viscous cycle of tax loss selling, fund redemptions, panic selling and more fund redemptions that peaked in late 1997 has been broken.
80.As bad as it's been for the majors, it's been pure carnage for many juniors; 28 of the 40 juniors we normally track were off more than 60% in 1997 alone.
81.Several companies could benefit from the elimination of litigation risk within the next 1-2 months ( e.g., TVX, Normandy, Newmont, Placer Dome ) .
82.Good value in several Australian gold stocks which were beaten down excessively ( and illogically, in our view ) due to Australia's proximity to Asia.



VII. Wildcards/Miscellaneous



83.Possibility that a Buffet-like figure could go long gold and trigger a rally as Buffet did for silver
84.Much of the world wants to minimize the pain felt by South Africa.
85.Potential political instability ( Middle-east, Russia, FSU, Pennsylvania Avenue ) . 86.Technical breakout possible ( $300/oz gold, 80 on XAU were key ) .
87.Comex short interest is 10-15% off its 1997 highs, but
88.funds are still solidly short; they'll rush to cover when the tide really turns. 89.Don't let Bill Gates take over gold too; Microsoft market value=$200 billion, cumulative gold equity universe = $40-45 billion.
90.Gold is the only major financial asset that is not the liability of another party.
91.Gold is far more liquid than many alternative assets ( e.g., real estate, timberland, most commodities ) ;bid-offer spread for bullion is as narrow as the trading spreads for stocks and bonds.
92.Historical adage that an ounce of gold could always be exchanged for a high quality men's suit; either Barney's is about to have a heck of a sale, or gold must go up. 93.Statistical evidence compiled by the World Gold Council ( ok, perhaps there's a bias, but we'll take their word on it ) that gold is a more effective asset diversifier than emerging markets investments versus the S&P 500 and most other asset classes. 94.Can't, or don't want to buy derivatives? Substitute gold for S&P 500 puts.
95.Gold serves a major role in portfolio diversification as correlations between stocks and bonds have increased markedly in recent years.
96.Limited downside risk; a classic technical "double bottom" at around $280/oz. Average cash costs of around $260/oz the probable point of "maximum" downside risk. 97.Beware of conventional wisdom: "We'll never see $1.00/gallon gas again" ( late 70's ) , "never buy airline stocks" ( late 80's ) , "gold is dead" ( late 90's ) .
98.George Bernard Shaw: "you have to choose ( as a voter ) between trusting to the natural stability of gold and the natural stability and intelligence of the members of government. And with due respect to these gentleman, I advise you, as long as the capitalist system lasts, to vote for gold."
99.Alan Greenspan- "Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of that insidious process."
100.Charles de Gaulle- "There can be no other criterion, no other standard than gold. Yes, gold, which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.

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