USAGOLD Discussion - March 2000

All times are U.S. Mountain Time

WAC (Wide Awake Club)
(03/01/2000; 01:41:13 MDT - Msg ID: 26237)
SIngle World Currency backed by Gold.
http://www.thisislondon.co.uk/dynamic/news/business/top_direct.html'To join or not to join. That is the question,' says William Simpson, adding, 'but the question is not simply whether to join the euro, but whether joining the US dollar may be a better option.'

Simpson, like the economist he is, asks simple questions only to give complicated answers. His reply to the question he poses on whether Britain would be better off with the dollar seems to be a definite maybe.

He is, in a sense, a voice from Euroland, in that he is the chief economist of the British end of a French company, Euler, which claims to be the world's biggest credit insurer and owns Trade Indemnity here.

Simpson asks whether the dollar might be a better soulmate than the euro not in an obscure economics journal, but in Risky Business, a risk-management magazine Euler sends to 7000 customers and opinion formers. The advantages of a dollar link, he says, are that British firms might also have better access to Wall Street, and could be well shot of an alliance with countries that are either confused about, or - shades of Germany and Mannesmann - still hostile to cross-border investment.

Better still, he believes a dynamic dollar-pound bloc would accelerate structural reforms in Euroland.

On the debit side, he says: 'Potential offence to euro partners would be great.' Loss of sover-eignty would also be at least as great with Uncle Sam as with European Union president Romano Prodi, Simpson says, adding: 'The US Treasury and Federal Reserve would still set policy first, and have no plan to seduce the UK into a dollar link.'

Other questions Simpson poses include: 'Could we be expelled from the EU if we link with the dollar?' and 'Would expulsion matter, if the EU moves in a socialist direction unsuited to entrepreneurship?' He regards the last question as 'particularly difficult', given that too many British politicians have jobs in Brussels to risk expulsion.

While hedging his bets in true economist style, he says one good thing about a dollar link is that it might be a step towards a world currency backed by gold. 'Even citizens of badly-run, basket-case economies could have faith in purchasing power and trade could be freed for ever from exchange rate volatility,' he suggests.

He concedes, however, that a world currency is some way off. He sees Britain being forced to integrate more with EU bureaucracy by virtue of EU membership, adding: 'Handing over British sovereignty in economic affairs by adopting the euro would at least end the pretence that we are on an alternative path.'

The pro or anti-euro debate, he says, obscures a deeper set of issues about market accountability and market freedom in the EU.

'The desire to anchor the pound to the dollar or the euro reveals a diffidence (or worse, hostility) towards the improvements in economics that are delivering low inflation and lower unemployment in the UK.'
View Yesterday's Discussion.

The Invisible Hand
(03/01/2000; 04:06:26 MDT - Msg ID: 26238)
BIS's Crockett (sp) to head IMF?
http://www.bbc.co.uk/worldservice/worldbusinessreport/ The BBC World Service radio World Business Report program reported during its March 1st, 2000, 10h45 GMT program that after Koch-Weser's rejection, a (former) BIS bureaucrat may be considered for the IMF top job.
Could this put the IMF's' attitude vis-a-vis gold in line with BIS's?
Leigh
(03/01/2000; 04:21:01 MDT - Msg ID: 26239)
Elwood
www.murabitun.org/WITO/dinar.htmDear Elwood: I wonder if the Mideast Trading Center has anything to do with the new Islamic dinar which was introduced last spring. Wasn't the dinar bank supposed to be in Dubai? I haven't heard much about the dinar lately; has anyone else?
Leigh
(03/01/2000; 04:23:20 MDT - Msg ID: 26240)
Wrong Link
http: www.murabitun.org/WITO/dinar.htmlSorry, wrong link. Hope this works (I'm in the dark here and don't have access to a pen to copy it down). If not, the link can be found if you search under "Islamic dinar."
Cavan Man
(03/01/2000; 05:54:14 MDT - Msg ID: 26241)
Elwood 26232
RE: ME Gold Trading CenterLet's speculate some more. If the LBMA and Comex close and "all paper burns", the physical metal will need to trade somewhere. Makes sense to me.
Henri
(03/01/2000; 06:04:02 MDT - Msg ID: 26242)
Gold Dinar
http://www.murabitun.org/programme/retgold.htmlThank you Leigh, That link didn't work either but I think this one will.
USAGOLD
(03/01/2000; 08:10:30 MDT - Msg ID: 26243)
Today's Gold Report: In Recovery Mode
http://www.usagold.com/Order_Form.html3/1/00 Indications
�Current
�Change
Gold
293.80
+1.30
Silver
5.11
+.06
Gold Lease Rate
0.4662%
-0.0426
Gold Comex Stocks
1,373,896
-1,192


Market Report (3/1/00): Gold continued in the recovery mode this
morning adding $1.30 to the price in the early going. The market
recovery which began yesterday is being fueled by short covering,
continued physical buying in Asia and the announcement by the Dutch
central bank that it was curtailing its selling program until September
or later. In a strange twist to the growing energy problem worldwide
that might have a more pervasive effect down the road, the Zimbabwe
Chamber of Mines reports that mining operations in that country are "at
a critical point" and "subject to sudden stoppages" due to a shortage of
diesel fuel and hard currency. As we suggested yesterday, the spat
between Europe and the United States over the Caio Koch-Weser candidacy
for executive director of the International Monetary Fund has deeper
implications than Koch-Weser's credentials. "Yes, there are differences,
also with the United States," he said. "We'll have to fight it out. I
see crisis prevention, precautionary avoidance of financial turbulence,
as a very big task. Just crisis management during emergencies is not
enough." The Reuters article put acting IMF head Irving Fischer,
Koch-Weser and Japan's Eisuke Sakakibara as the leading candidates for
the top position.

That's it for today, my fellow goldmeisters. See you back here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click on link above and make the appropriate entries.
Aristotle
(03/01/2000; 10:33:02 MDT - Msg ID: 26244)
Hello Julia--having read your latest questions for Trail Guide I thought this might help
http://www.usagold.com/halldiscussion.htmlThe link is from TownCrier's assemblege of the various discussion that came on the heels of my ""perfect" monetary system for an imperfect world" commentary. I know that my comments are way too long, but I would encourage you to scan over it again in light of your recent line of questioning. I think you may find several avenues for seeing things differently.

You seem to perceive that there would be no fundamental change under the system that is being described. You wrote in response to the dollar continuing to be in service for wages, "How can the dollar maintain its place as a settlement of commerce if it no longer represents anything of value and is bankrupt? ... To me it's like going to my neighbor and saying, 'Here, take this piece of paper ... even though I have ... gold.' Why would he continue to take it? Because the feed distributer will accept it as payment for his feed as well as the farmer he buys the hay from. But isnt that what we have now?? Aren't we looking for a better way? ...What happens when Joe Public wakes up to what has happened to our dollar and the big boom has been really the big debt? Won't there be outrage and distrust? Won't my grocer not take my dollar for the groceries anymore demanding that he be paid in gold or silver or barter goods? And then will the banks have to cash my check in gold or silver? I don't understand how things can continue unchanged after the dollar tanks."

The whole purpose for my pages and pages and pages and pages was to lay a basic foundation toward answering many of the questions you've asked. Seeing your comment that you have in fact read my writing, I can only conclude that I failed in my effort, for which I am solely at fault. Perhaps it was too long. Back to the drawing board...

Here's my suggestion in the meanwhile. Print out the commentary using a nice, large comfortable typestyle, then make a nice big bowl of popcorn, pour yourself a glass of Coke, and work your way through it with a red ball point pen. Cross out everything you know to be false, and underline everything seems to go against your conventional wisdom or perception. Circle everything that you can immediately accept as fundamentally true or as common sense. As you continue to work your way through the text, you will see that I at various points tried to offer deeper explanations on the various statements I made that I assumed would not "sit right" with people's initial perceptions and convential wisdoms. (I was in tune with which points these would be because I am a longtime Gold advocate, and I had to overcome all of my own off-base perceptions and notions regarding Gold's role in the monetary system. So, using myself or friends as my litmus test, I knew what areas required the most attention.) As you read through my reasoning, if you find the answer to be acceptible, go back to the original statement that you underlined as vexing, and circle it if it has now gained entry into your "collective wisdom" or "conventional perception" of the world.

Here's an example. Early in the commentary I say that paper money isn't worthless. That is something you might be inclined to underline because we all like to say that it IS in fact worthless--it goes against the grain of our thought, and you allude to that in your comments above. Then, as you read further, you will encounter a block of text that includes these ideas: "...the value in any given currency-unit originates in the terms of the loan contract in which the borrower has promised to repay these units of currency to the lender. ...It's easy to convince yourself that people will provide goods or services in return for dollars--either because they themselves are in debt and in need of the currency to repay their outstanding debts, or else because they believe with near certainty that these same dollars will be useful to them as a medium of exchange when they encounter somebody else who is burdened with outstanding debts." So, as you ask what will happen when Joe Public wakes up to the fact that our big boom was a big debt, we can see what it is that will keep these dollars in circulation. EVERYBODY needs them to pay off their big debts. And those that crawl out of debt will seek the stability of Gold "currency" for their savings because their national currencies will ever be dwindling in value. All of history shows us that. In the text, I offer more on that account, and if you agree with the case presented, go back to the phrase you underlined and add it to those you agree with by circling it entirely.

To help you further, once you've read a block of text that makes the case for something you've circled either initially or subsequently changed from an underline, feel free to draw a big "X" through it so you never have to waste time on it again. Also, "X" though everything that strikes you as idle banter. I do this from time to time to make the text more "fun" to read (and write) by breaking up the endless string of more serious topics.

When you get to the end, you will have X'ed through most of the text, you will have circled the key points you initially or subsequently agreed with, and you may very well have some text that remains underlined and in doubt. Read through the text one last time, reading ONLY what has been circled, followed by a a review of what remains underlined. This is generally what I do myself when I sit down to digest a body of information that is unfamiliar to me. It really helps put the focus on the issues that are personally relevant to yourself, and essentially gives you an executive summary of points, with highlights for further inquiry.

Ultimately, you asked, "Why can't free gold back currencies?" As I attempted to present to the reader, although putting Gold in a role to "back" a currency does to a degree help the currency for awhile, it nonetheless KILLS Gold, and leaves you with no true safe haven for a savings plan except for such illiquid real things as your land, house, car, pot and pans, tools, lawnmower, etc. We need to have the very liquid, very real property known as Gold to be left free to serve in this capacity. That doesn't make it any less "money." To the contrary. It makes it moreso. Those with Gold bars and Gold coins would find themselves propelled to a higher financial position in a world that wants what they have.

Julia, I've enjoyed the chance to chat with you. I'm also glad to see you've derived some benefit from the description of my "personal Gold Standard" stragegy of wealth management. It has helped me live a fuller life, knowing that the world offers much more important things than those that can be found in a Wall Street Journal.

Gold. Get you some. A good life is sure to follow. ---Aristotle
Aristotle
(03/01/2000; 10:57:26 MDT - Msg ID: 26245)
To Peter Asher--follow up from Monday (was it Monday?)
A couple of good friends have told me I should read Rand. Judging from your comment I would probably find that her philosophy resonates with mine. It is always good to know that we are not alone in our view on the world. Personally, I never have been able to rationalize--as many people apparently have--that we could all somehow in perpetuity continue to expect to retire at an early age and be able to consume over the course of our remaining lives more than we ever produced. Where this can be done is where the production of others has been granted unto you either by hook or by crook, or plain old good luck--like being able to get out of a ponzi scheme before the meltdown, holding the winning number in a lottery, or by inheritance, for example. It is good to know that you don't think I am a crank for believing that a typical person such as myself is capable of producing an excess throughout a lifetime, the size of which (and ecpected lifespan and lifestyle) will dictate when retirement may occur. All that I ask is that I have a reliable means with which to represent and save my excess productivity--my wealth. For this reason, we need Gold to sever its attachments to inflatable paper. In the process, there is no need to demand the fall of the paper currency card houses...they will do that on their own and in their own timeframe. Of course, being free to choose and hold Gold, your wealth would be immune to the destruction. Who could ask for anything more?

Gold. Get you some. ---Aristotle
MarkeTalk
(03/01/2000; 11:05:20 MDT - Msg ID: 26246)
Yen Repatriation Linked to U.S. Treasury Sales?
http://biz.yahoo.com/rf/000301/we.htmlYen could be helping today's uptick in gold.
Interesting read. Change of direction for Japan?
MarkeTalk
(03/01/2000; 11:16:26 MDT - Msg ID: 26247)
Mexican Minister Says Market Needs Increase in Oil Output Mexican Minister Says Market Needs Increase in Oil
http://ap.tbo.com/ap/breaking/MGIVL6F7B5C.htmlWith all talk about increasing oil supply, why is the market still rising? April crude is now at $31.33, up $0.90. Go figure.
Aristotle
(03/01/2000; 11:33:33 MDT - Msg ID: 26248)
Clarification on retirement comment to Peter
I said, "Personally, I never have been able to rationalize--as many people apparently have--that we could all somehow in perpetuity continue to expect to retire at an early age and be able to consume over the course of our remaining lives more than we ever produced."

I've got no problem with the idea of retiring early--more power to you if you can hang up your toolbelt at age thirty-three! My point being that the productivity of your active years seems like a fair measure of what you would rightfully have a claim to in the course of your life. And in the regard that those of us that were wise enough to choose Gold at historic lows before it reclaims the throne of monetary supremacy will be receiving windfall profits, well hey, I can live with it. It's all the better when the nation's financial elite know a thing or two about sound money, and rose to the top on that conviction, wouldn't you say? OK, enough fanciful talk for one day.

Gold. Get you some. ---Aristotle
Cavan Man
(03/01/2000; 13:33:56 MDT - Msg ID: 26249)
OIL
$31.70
CoBra(too)
(03/01/2000; 14:18:20 MDT - Msg ID: 26250)
As CM says - oil up over a buck to 31.70!
Gold back to the doldrums and seemingly back to its 2 $ max volatility!
Something's very foul in the state Denmark, though nobody seems to care and if someone cares he gets the cold (or is it nutty - haven't you yet learned gold is out ...forever) shoulder.
Another 6 months and every exploration co. will be either
internut or dead. Who's counting on that outcome? ...and who's responsible for this irresponsible manipulation, or is it collusion?
Is it currency war on the back of a few, manipulating and blackmailing gold producing countries and miners, as experienced by oil producers (Std. Oil) and OPEC before 1972. This collusion to stem the tide versus the fiat $ is
doomed to fail, as it failed in the 70's - and no high tech
weaponry will change this fundamental truth (see Russia vs Chechenia), or on the other hand see Austria, not budging in their democratic elected government, vs the rest of the world.
It reminds me of the same kind of blackmail, which would not have happened if the country would have had the relative importance of say France, Germany or even Italy. BTW, after all EU is now 90% plus socialist governed and the Portugese
Pesident happens not only to be EU's acting president, but also president of the international socialistic league. What
an incredible bungle - I wonder what really is behind it, keeping the CDU scandal in mind?
Go ahead gold bugs and fight the collusion and the colluders - and go for gold - the only true money!
Double venting - CB2

Cavan Man
(03/01/2000; 14:39:05 MDT - Msg ID: 26251)
Hello CB if you're out there...
What's your take on the latest thoughts from TG/FOA regarding "legal tender laws" and changing international same? Thanks.
R Powell
(03/01/2000; 15:22:08 MDT - Msg ID: 26252)
J C Tex, Gandalf, Wiley Re Silver Certificates
If memory serves me right, the government set a date years ago by which all Silver Certificates had to be returned for newer non-metal backed currency. After said deadline the old currency became by government proclamation - worthless paper. I'm sorry to tell you your paper is of no value but before you decide to throw it away let me send you a self-addressed stamped envelope.
CoBra(too)
(03/01/2000; 15:36:30 MDT - Msg ID: 26253)
@ Hello CM
I'm not current for some days - though in my mind 'legal tender' means the (il)legality to enforce the "means" of exchange for real product, or intermediary for barter.
If a government enforces paper FRN's as legal exchange for a commodity (product), so did Jesse James with (some silver) bullets in his colt.
Is that what law enforcement really means? :-) CB2
Trail Guide
(03/01/2000; 16:05:00 MDT - Msg ID: 26254)
justifiable use of federal power at a time of national emergency
Interesting stuff!! no?

Legal Tender Cases

(1870, 1871), two cases decided by the U.S. Supreme Court regarding the power of Congress to authorize government notes not backed by specie as money that creditors had to accept in payment of debts.

To finance the Civil War, the federal government in 1862 passed the Legal Tender Act, authorizing the creation of paper money not redeemable in gold or silver. About $430 million worth of "greenbacks" were put in circulation, and this money by law had to be accepted for all taxes, debts, and other obligations--even those contracted prior to the passage of the act.

In Hepburn v. Griswold (Feb. 7, 1870), the Court ruled by a four-to-three majority that Congress lacked the power to make the notes legal tender. Chief Justice Salmon P. Chase, who as secretary of the Treasury during the Civil War had been involved in enacting the Legal Tender Act, wrote the majority opinion, declaring that the congressional authorization of greenbacks as legal tender violated Fifth Amendment guarantees against deprivation of property without due process of law.

On the day the decision was announced, a disapproving President Grant sent the nominations of two new justices to the Senate for confirmation. Justices Bradley and Strong were confirmed, and at the next session the court agreed to reconsider the greenback issue. In Knox v. Lee and Parker v. Davis (May 1, 1871), the Court reversed its Hepburn v. Griswold decision by a five-to-four majority, asserting that the Legal Tender Act of 1862 represented a justifiable use of federal power at a time of national emergency.
Trail Guide
(03/01/2000; 16:17:02 MDT - Msg ID: 26255)
government's power to enact legal-tender legislation and defending such power under the "necessary and proper" clause of the Constitution



Strong, William

U.S. Supreme Court justice (1870-80), one of the most respected justices of the 19th-century
court.

Admitted to the bar in 1832, Strong practiced law in Reading, Pa., and served in the U.S. House of Representatives (1847-51). While sitting on the Pennsylvania Supreme Court (1857-68), Strong, a Democrat but a firm supporter of the Union, changed his political affiliation
and became a Republican.

-------- in Knox v. Lee and Parker v. Davis (1871), the newly formed court overturned the Hepburn decision by a vote of 5-4. Strong spoke for the majority, upholding the
government's power to enact legal-tender legislation and defending such power under the "necessary and proper" clause of the Constitution. The abrupt reversal of a major decision so soon after the enlargement of the bench renewed the charges against Grant. Despite this controversy, which overshadowed Strong's appointment to the high court and his first major decision, he served with distinction for 10 years, winning the respect of the legal community for
his ability and integrity.-------------------
Cavan Man
(03/01/2000; 16:17:28 MDT - Msg ID: 26256)
Knox V Lee & Parker V Davis
Freedom requires justice; and, justice, vigilance.
Cavan Man
(03/01/2000; 16:18:49 MDT - Msg ID: 26257)
Trail Guide
Same apply to, "changing international law"? Is that your point? Tyou.
Trail Guide
(03/01/2000; 16:30:16 MDT - Msg ID: 26258)
And how many "shinplasters" are in your bank account?
Here is some more very good food for thought. Please note the word use and how it could be so very "in context today". Especially these items:

--suspensions had occurred during periods of war or economic crisis-------------

----- "Hard money" advocates wanted to resume paying specie for this paper money, while "soft money" supporters feared the deflationary impact resumption would produce. -------

-----public favourably inclined to keep using the much more convenient paper money--------

============================================================

the redemption of U.S. paper money by banks or the Treasury in metallic (usually gold) coin.

Except for a few periods of suspension (1814-15, 1836-42, and 1857), Americans were able to redeem paper money for specie from the time of the ratification of the Constitution (1789) to the onset of the Civil War (1861). The suspensions had occurred during periods of war or economic crisis. With the outbreak of hostilities between the North and the South, the federal government again suspended specie payments late in 1861.

In 1862 the government began issuing paper money, called "greenbacks" and "shinplasters," and in 1863 it authorized federally chartered banks to issue national bank notes. By the end of the war in 1865, more than $430,000,000 worth of paper money (declared legal tender by Congress) was in circulation.

"Hard money" advocates wanted to resume paying specie for this paper money, while "soft money" supporters feared the deflationary impact resumption would produce. After the Supreme Court sanctioned the legitimacy of the paper money in the Legal Tender Cases (1870-71), congressional backers of a return to specie payments passed the Resumption Act of 1875.

In accord with the Resumption Act, specie payments were resumed on Jan. 1, 1879. But the knowledge that the government could indeed redeem each greenback or bank note at par in gold made the public favourably inclined to keep using the much more convenient paper money.

Cavan Man
(03/01/2000; 16:31:32 MDT - Msg ID: 26259)
Trail Guide
You are a good teacher. I harken back to my days spent at the pub (after the rugby match), er ahhhhhh University. Understanding a teacher's method helps the student progress.
Trail Guide
(03/01/2000; 16:39:34 MDT - Msg ID: 26260)
greenbacks continued as the accepted currency!
You may have to put these posts in order, but it's worth a thought.
I know most all of you already know this stuff,,,,, but thought a short review would be good.
(smile)




Resumption Act of 1875

in U.S. history, culmination of the struggle between "soft money" forces, who advocated continued use of Civil War greenbacks, and their "hard money" opponents, who wished to
redeem the paper money and resume a specie currency.

By the end of the Civil War, more than $430 million in greenbacks were in circulation, made legal tender by congressional mandate. After the Supreme Court sanctioned the constitutionality of the greenbacks as legal tender, hard money advocates in Congress pushed for early resumption of specie payments and retirement of the paper money.

On Jan. 14, 1875, Congress passed the Resumption Act, which called for the secretary of the Treasury to redeem legal-tender notes in specie beginning Jan. 1, 1879. The bill also called for reducing the greenbacks in circulation to $300 million and for replacing the fractional paper
currency ("shinplasters") with silver coins as rapidly as possible.

Members of the new Greenback Party were bitterly opposed to the Resumption Act, and in 1878 they succeeded in raising the amount of paper money allowed in circulation. Specie
resumption proceeded on schedule, however, and Treasury Secretary John Sherman accumulated enough gold to meet the expected demand. When the public realized that the paper money was "good as gold," there was no rush to redeem, and greenbacks continued as the accepted currency.


Trail Guide
(03/01/2000; 16:45:50 MDT - Msg ID: 26261)
(No Subject)
Cavan Man,
Don't ever think that your old college teachers weren't learning too as they went along! We always learn from each other. All our lives!
In these articles, it's interesting just how easy people groups can change the rules. For better and worse. I'll send some more in a minute. Also am working on the next Trail walk. )smile)

Trail Guide
(03/01/2000; 16:57:05 MDT - Msg ID: 26262)
farmers and others who wished to maintain high prices!
Aristotle,
Isn't it interesting (and supporting our freegold cause) that the government can "legitimize" an "unbacked" "greenback" currency ,,,,,,, by just accepting debt satisfaction (payment) in said paper!

See: last sentence

It seems that during both yesterday and today, the publics perception of money in circulation is more identified by it's ability to "square the books". Whether it's gold or fiat!?!?


=================================================
Greenback movement

(c. 1868-88), in U.S. history, the campaign, largely by persons with agrarian interests, to maintain or increase the amount of paper money in circulation. Between 1862 and 1865, the U.S. government issued more than $450,000,000 in paper money not backed by gold (greenbacks) to help finance the Union cause in the American Civil War. After the war, fiscal
conservatives demanded that the government retire the greenbacks, but farmers and others who wished to maintain high prices opposed that move. In 1868 the Democrats gave partial support to the Greenback movement by endorsing a plan that called for the redemption of certain war bonds by the issuance of new greenbacks.


CoBra(too)
(03/01/2000; 17:10:35 MDT - Msg ID: 26263)
CM-TG/FOA - on legal tender
Is primarily a medium of exchange, backed by legal and truthful reality by government (- love me tender, love me true* :-)) and convertability into real goods at a fixed exchange rate to gold (until 1933/71).
Today, legal tender is still a medium of exchange, convertible at the perception of value of the power to be - until other powers may find some flaws in inherent value (perception) of the value.
Cauri Mussels have been a currency in some backwater country for ages. So where's te difference?
Yes, I know and appreciate the difference is in GDP growth, measured by productivity gains. That's a tough equation in todays world, where productivity is measured by
enhancing services in a predomantly service industry.
Even if RD is a part of this new paradigm - it may be vastly overstated. IT, High Tech and Biogenetics are predominantly leading American technology - but when it comes to production of microchips, computers, TV's, etc ... TM's tell us different.
Fine, as long international division of labor works! Does it? - As long as the US of A seems to reap most of the (il)legal tender benefits due to seignorage of the US$ - these days may seem counted.
IMO, free floating currencies seem to me to be the old adage of political means - ending in war -currency war as it befits the times.
The time for the only true arbitrator of value between trading partners, accepted by all participants -gold - is overdue to make its comeback! CB2 - venting again!
Trail Guide
(03/01/2000; 17:10:58 MDT - Msg ID: 26264)
Legal Tender,,,,,,, a long subject
After reading below, one can see that silver came into the picture more so because it would allow "greenback" expansion. The whole context of involving silver into the money system came about from the changing of the "Legal Tender" laws earlier. The thrust of the argument was that
people wanted the ability to expand their fiat monetary base........ and the Legal Tender laws were the first way such a change came about.

be back later TG

============================================================

More on the "Greenback movement"


The Panic of 1873 and the subsequent depression polarized the nation on the issue of money, with farmers and others demanding the issuance of additional greenbacks or the unlimited coinage of silver. In 1874 champions of an expanded currency formed the Greenback-Labor Party, which drew most of its support from the Midwest; and after Congress, in 1875, passed the Resumption Act, which provided that greenbacks could be redeemed in gold beginning Jan.
1, 1879, the new party made repeal of that act its first objective. The 45th Congress (1877-79), which was almost evenly divided between friends and opponents of an expanded currency, agreed in 1878 to a compromise that included retention of the Resumption Act, the expansion of paper money redeemable in gold, and enactment of the Bland-Allison Act, which provided for a limited resumption of the coinage of silver dollars. In the midterm elections of 1878, the
Greenback-Labor Party elected 14 members of Congress and in 1880 its candidate for president polled more than 300,000 votes, but after 1878 most champions of an expanded currency judged that their best chance of success was the movement for the unlimited coinage of silver.


CoBra(too)
(03/01/2000; 17:30:58 MDT - Msg ID: 26265)
Gold down 2,50 in overseas trading ...
Well, the scales are only a medium for weight measurement ... and sometimes tipped! Good night CB2
Black Blade
(03/01/2000; 18:30:28 MDT - Msg ID: 26266)
A note from an email......Dot.com? or Dot.bust?
Remember Matt Jacob, the investing wunderkind who turned the Internet Fund into America's best loved Internet mutual fund? It seems his new-and-improved Jacob Internet fund, launched last December, isn't faring nearly as well. The fund, launched with $150 million during a two-week subscription period, and now claiming about $270 million, is actually down on the year.

While competing funds like Munder NetNet and WWW Internet have pulled in returns of about 14 or 15 percent since the beginning of this year, Jacob's portfolio is down 2.5 percent. That performance has the rabble-rousers on the investing message boards taking aim at the once revered Gen-X money manager.

Black Blade: Now just think how the masses will react when the whole dot.com speculative bubble bursts! I don't think there will be a LTCM type bailout for the masses. If Jacobs is getting a little heat overa miniscule loss of 2% so far this year, well then look out below .... Hmmmm....


Black Blade
(03/01/2000; 18:43:51 MDT - Msg ID: 26267)
Pd manipulation continues....
Source: Bridge newsNYMEX to hike palladium margins as of Wednesday close

New York--Mar 1--The New York Mercantile Exchange said that it will increase margins on its palladium futures contract as of the close of business Wednesday. Margins will rise to $37,500 from $22,500 for clearing members; to $41,250 from $24,750 for members; and to $50,625 form $30,375 for customers. (Story .15851)

schippi
(03/01/2000; 18:45:05 MDT - Msg ID: 26268)
FSAGX Hourly Gold Sector Chart
http://www.SelectSectors.com/agpm70.gif FDPMX has been merged into FSAGX as of 2/29/2000

FSAGX Trying to form local bottom.


Black Blade
(03/01/2000; 19:37:09 MDT - Msg ID: 26269)
Don't worry, be happy!
COMEX warehouse added another 1.8 million oz of silver today. That's roughly 20 million oz in the last few days! Also Crude oil rose to $31.70, but don't worry, it won't add to inflation, the experts at the gubbermint tell us so. Pd and Pt dropped today, in spite of the fact that there isn't any to be had. The SA and NA producers have their production committed, and the Russians simply don't have any. Meanwhile the TOCOM and COMEX people have added another layer of market manipulation on PGMs. Don't worry, none of this will show up as inflation!.....Unless the PPI and CPI numbers are manipulated too. Oh well, might as well have another beer aned just be happy! Hmmmmm........ We live in interesting times, yes?
Julia
(03/01/2000; 20:00:34 MDT - Msg ID: 26270)
Aristotle
I have read your many, many wise thoughts for a long time now my friend and I can tell you that it's not you, it's me who needs to go back to the drawing board. Your writing needs nothing else. I knew it would be a challenge for me to understand the first time around and I have been remiss in not telling you how much I appreciate your work.

I've enjoyed our chat as well. Thank you for your help. Sorry to be slow in catching on to all this.

Just know that I know you as a good and kind and patient teacher so don't think your work was in vain, far from it. I just don't get it yet. I'll stay in after school for these extra lessons any day you are willing to take on the challenge of teaching me what you know . The gift of your time and your thoughts are of great value to me. Where else could I get such a fine economics education than at my favorite "Knight Spot???" (Big Smile)

.....Headed back to the sofa with caffeine and red pen to re-read and ponder your thoughts.

Thank you, Aristotle
Julia
Goldy Locks Guy
(03/01/2000; 20:36:38 MDT - Msg ID: 26271)
Does anyone know about SUNR
Hi...Does anyone have any comments about Sun River mining???

I have looked at this stock for months, with no trading activity...and then today it was up a cent with volume of 60,000....Just wondering if this little bugar has any potential.....

Thanks....Goldilocks guy
Solomon Weaver
(03/01/2000; 20:49:48 MDT - Msg ID: 26272)
20 million ounces of silver...how relevant?
Black Blade (03/01/00; 19:37:09MDT - Msg ID:26269)
Don't worry, be happy!

Some folks have been watching the silver flowing into COMEX and interpreting it as a sign of "concern".

Consider the following facts:

550 million ounces silver total mine production 1998...total demand around 750 million ounces.

I would propose to you that this level of silver movement is not neccessarily uncommon at COMEX (especially in the season of the year Q1 when a lot of large users are contracting or taking delivery of material in the current years budget for operating expences.)

------

Now, that being said....unless Mr. Warren Buffet has "sold" silver (which I seriously doubt), he has title to 130 million ounces...we must assume that such a prudent investor as he is would only "lease" metal that he holds in a vault. It is a little hard to put hands on the real figure for vault reserves of silver...but the "official" numbers have shown a rapid deterioration from 1.8 billion ounces in 1990 to around 200 million ounces in 1998. During the last 6 consecutive years, the yearly deficit in silver supply has been averaging just under 200 million ounces. So, based on "official numbers", the 20 million additional ounces which you mention coming into COMEX could represent 10-20% of the remaining "official sector" silver supply. Thus, although not "historically relevant", that number could be highly relevant in "today's" very tight market.

Another very important aspect to consider....since the price of silver is very low now and has been for a while...WHAT INCENTIVE WOULD THERE BE TODAY for someone with millions of ounces of silver held somewhere outside of the "official inventory" to suddenly sell??? The only way a large holder could be attracted into this market would be for "certain parties" to arrange a "semi-official" deal....where a dramatic premium was paid "off market" for a transaction which occured "in market".

Here is a very important point:

From at least 1950 (the beginning of the graph I have) the "official silver bullion inventory" as reported by CPM Group 1999, remained at a MINIMUM of 850 million ounces and since 1966 a MINIMUM of 1 billion ounces. By 1990, the silver inventory had reached a mulitdecade high of over 1.8 billion ounces. Then, in the accelerating lease/forward sale decade of the 1990s, in the face of strong demand and marginal increase in mine production, the silver inventory starts a free fall. By 1996, the "official" inventory was at the "low" which it had seen in the very late 50s and early 60s. This should have been a warning sign...but NO...inventory has continued to fall dramatically.

Now, we enter a world where silver mining has been very unpopular and more than 1/2 of the worlds 6 billion people do not own electronics, use photos, etc.

Sorry for this elongating post, but I have to use an anology here that comes to mind....surfing...

Every real surfer has had this happen at least once...one is out on the water...watching the swell...waiting for the right wave...always looking towards the ocean...here comes the wave....one starts to paddle hard...looking back...and just as one makes the move to stand up...one looks forward...and there right in front of this beautiful 6' wave is....SAND.......crash...

Even if there is silver stocked up by the millions of ounces...the usual method to attract "real sellers" into the market is to bid a higher price. The fact that there may be as much a 1 billion ounces "short" means that in the very near future, everyone who is "now in the market" is going to be a "buyer". The only "real sellers" (and I mean real metal), will be "new" sellers who are bringing in all that "unofficial" silver we hear of.

The situation here is far more dramatic than in gold...although in gold much more dollars are at stake, for sure.

Lets compare the past with the future:

Almost 20 years ago, the Hunts took a leveraged position of about 100 million ounces of silver, when almost no "metal leasing industry" had existed (thus short contracts or buyback obligations were lower), and the official inventory was 1.0 billion ounces...the average yearly price spiked from $5 to $20...and a great meltdown of USA citizens silver occured as people dumped on the scrap market.

Today, Warren Buffet has an unleveraged position of 130 million ounces, there has been a massive "metal leasing activity" in silver which has produced hundreds of millions of ounces of "buyback obligations" and layers of paper shorts holding up the dike, and the official inventory is less than 200 million ounces (an average of 1 years deficit)..WB has a massive corner on this market and nobody cares!!!! And this time, when the USA citizen gets involved it is more likely to be as "buyer".

The only thing that could be more explosive would be if silver nitrate would be used in gunpowder!!!

Gandalf, as special little note to you...perhaps you should encourage the hobbits to make just a little room in the vaults at Bag End for a little silver, no?? Heard lately that the Chinese are intending to start an elite force of 100,000 "white berets" and they have chosen an alloy inspired by the famous elf made mail of Sir Bilbo.
Solomon Weaver
(03/01/2000; 21:11:49 MDT - Msg ID: 26273)
Paid in dollars
Julia

To you and anybody else who is worried about a total implosion of the dollar...

Imagine yourself standing at the edge of a crevice...behind you is a tiger (who might decide to attack you) a few feet away is the other side where you could leap to safety...how wide a gap will you consider before you decide that a leap is certain death, where to stay with the tiger is probable death (while you consider other exit strategies).

In a world which measures GDP increases and inflation is 1,2,3,4 percent, even a "slow slide" of the dollar losing 5-10% of its worldwide purchasing power each year would create chaos...but eventually there would be some new equilibrium and it would stabilize...not to say that many fortunes could be lost along that way.

Regarding what you will be paid. I agree dollars. If we understand Alan Greenspan, there is a thriving "real economy" underlying all the "paper millionaires" fantacy economy. Once Americans understand that in a "multipolar" world, we cannot be king of the fiat hill, and adjust to the "new rules" we will recover and remain an important world economy...

Perhaps it is more important to consider not what you will be paid for your job...but will your job pay. No insult intended here....some of the most talented and qualified people will find themselves to be in a sector which we can do without for a while....

Poor old Solomon
Journeyman
(03/01/2000; 21:24:36 MDT - Msg ID: 26274)
Old dead white economists & unstable gold @ Aristotle, Julia, dragonfly, ALL

For some reason, I'm feeling defensive - - - -

"My ideas are wide open to deliberation and
disagreement, but I won't seriously entertain
dissention based on such a premise as "Yeah, but Mises
said..." or "But Keynes said..." unless it is first
filtered through a fellow poster's own thoughts and
words. If we were content to let them (dead economists)
do our thinking for us we would all be doomed to living
with the flaws of the most distant past (that being the
first "formal" opinion offered), and we certainly
wouldn't have much need for a discussion forum."
-Aristotle (2/28/2000; 8:36:34MDT - Msg ID:26123)

I can't speak for others, but there are three main reasons I
like to quote sources:

FIRST, and most importantly, I quote people because I've
found that what they say in a particular instance is the
clearest presentation (in some cases the _only_
presentation) of an idea I've run across. Quite often, such
a quote is far clearer than I could achieve in a reasonable
time - - - if at all. That is, the work's already been done
by someone else - - why reinvent the wheel?

SECOND, all the fine posters here, particularly Aristotle
right now, probably know how hard it is to produce sentences
and paragraphs that communicate just what you intended. I
for one appreciate this difficulty and believe these efforts
should be rewarded, at least by the recognition of an
included acknowledgement of that effort. Especially when it
has increased my understanding.

THIRD, y'all don't know Journeyman from Alan Greenspan - - -
or the drunk three stools down the bar. Quotes from
"authoritative" or known sources let me off the hook and
lends me credibility even when I fall off my stool. "Don
argue wi me, heesh the one who sheed it."

Finally, at least when I post a sourced quote (can't speak
for others,) it has indeed passed through my mind and been
interpreted by that organ as relevant to some topic, or just
plain interesting. If I were to paraphrase rather than
quote, the results could be anything from obtuse to
plagiarism. Worse yet, the results might even be
inaccurate.

As for the "bare naked" Mises quote in Journeyman
(2/27/2000; 18:57:15MDT - Msg ID:26103), the essence of
which was:

... "the demand for a medium of exchange is the
composite of two partial demands: the demand displayed
by the intention to use it in consumption and
production and that displayed by the intention to use
it as a medium of exchange.[7] With regard to modern
metallic money one speaks of the industrial demand and
of the monetary demand. The value in exchange
(purchasing power) of a medium of exchange is the
resultant of the cumulative effect of both partial
demands."

If it needs interpretation - - - First, Mises quote above
is stated in the context that "The Law of Supply and Demand"
applies to money. This explains, in part at least,
FOA/Trail Guide's difficulty in predicting the price in
dollars for gold after a dollar melt-down. Particularly,
the demand for gold as a medium of exchange after any major
dollar devaluation would be just about impossible to
predict. Thus so would the "price" of gold in dollars.

The people here speculating on gold giving them MORE than
parity buying power after such a devaluation are speculating
that there will be some "medium of exchange" demand for
gold. The bigger the "medium of exchange" demand, the more
added value to holding gold.

Finally, as the "medium of exchange" demand for gold
fluctuates, so will it's buying power. There is NO absolute
standard of value that doesn't fluctuate. Gold, on the
other hand, at least according to the historical record,
fluctuates LESS than any other medium of exchange,
particularly less than ANY fiat that's ever existed.

That's why Aristotle's right. Gold. Get you some!!

Regards,
Journeyman
Simply Me
(03/01/2000; 22:45:14 MDT - Msg ID: 26275)
@ Solomon Weaver/Julia et al.
Sir Weaver said: "Perhaps it is more important to consider not what you will be paid for your job...but will your job pay. No insult intended here....some of the most talented and qualified people will find themselves to be in a sector which we can do without for a while...."

Perhaps it is the season for a bit of wisdom passed along from folks who survived the depression. They said, "Have something to do (meaning a job) with your head, and something to do with your hands, and you won't starve."

Be ready to change gears, change jobs, change lifestyle. The flexible will not only survive, they'll get stronger in the coming changes. There's nothing like a good old fashioned dose of hardship to remind people of what's really important to them. Pride in your chosen field of endeavor?...or your family's food, warmth, and safety? Might wake up some of the twenty-somethings I've seen who only show up for work when they feel like it, because there's always another shop at the mall looking for help.

Please, excuse the ranting. But I actually think a little depression would be good for this country as a whole. The government can't support half the country on welfare. It would break the socialists backs, make self-reliance and entrepreneurial thinking not only popular but necessary, and it surely would bring home the importance of precious metals as a form of individual indestructable savings.

Preaching to the choir.
simply me

TEX
(03/02/2000; 00:10:57 MDT - Msg ID: 26276)
Anniversary Date
Well.......its a year to the date that I bought my first physical.......its at the same price (almost to the penny)a year later.........probably should have held off until sometime last summer to make my first purchase........Of course, hind sight is always 20/20........Oh well, I'm still hanging in for the long run.........Hmmmmmmmmmm........View Yesterday's Discussion.

CoinGuy
(03/02/2000; 00:43:20 MDT - Msg ID: 26277)
TEX and gold purchasing...
TEX,
It's been about a year since I talked a friend of mine into buying some physical. A week or two ago, he said, "Gold hasn't gone up much has it?" The inflection in his voice meant he was trying to make a point. I asked him where he got the money to purchase the gold, "mutual fund" was his reply. I told him to look up the fund and see where it was.
Two days later he called and told me it was down 4.30 from the day he sold out.

I realize this might be defined as a special case, but I keep track of several portfolios, trusts , etc. All is not well in the world of equities. I'd like to hear more comments on this...I guess people don't like to talk about their losses.

And..no...I'm not talking about those high flying biotechs, comm, or internet stocks, I'm talking about Jo six blo, out there with a good diversified portfolio. Bond values are getting hit, blue chips stocks have been in correction mode, and looking for new long term investments has been downright nasty for quite awhile(T-Bills have been looking good).

His investment in physical amounted to 7% of his portfolio, a good hedge in this type of market environment. I myself have gone higher, but hell, I'm addicted.


Coinguy
Canuck
(03/02/2000; 04:30:08 MDT - Msg ID: 26278)
Friday
Seems to be a significant amount of speculation that Friday will be a big day for gold. Can I ask why?

TIA.

Canuck.
Canuck
(03/02/2000; 04:36:19 MDT - Msg ID: 26279)
@ Coinguy
My girlfriend got talked into an index fund (TSE300)early in the new year; did well for a month and recently has pulled back; she's up a percent or two for the year. I've been trying to talk her out of it.

I saw your post a day or two ago re: the wheeling and dealing of coin. Are you in the Vancouver area?

Canuck.
Zenidea
(03/02/2000; 06:27:59 MDT - Msg ID: 26280)
another change in the rules
http://www.scmp.com/News/Markets/Article/fullText_asp_ArticleIDsee if this posts ?
Zenidea
(03/02/2000; 06:31:26 MDT - Msg ID: 26281)
re Palladium
http://www.scmp.com/News/Markets/Article/FullText_asp_ArticleIDoops.
Zenidea
(03/02/2000; 06:36:00 MDT - Msg ID: 26282)
Persistent to get it right
http://www.scmp.com/News/Markets/Article/FullText_asp_ArticlelDlast try :) Hi peoples :)
Phos
(03/02/2000; 07:19:28 MDT - Msg ID: 26283)
Goldy Locks Guy Msg ID:26271 - SUNR
http://www.siliconinvestor.com/stocktalk/subject.gsp?subjectid=22875This company was started by some former Golden Eagle (MYNG) employees, some with questionable bacgrounds, I believe. There is a thread on SI for SUNR (see link). Someone has been accumulating the stock. Maybe another .com in the works because they have a OTCBB listing? It is not a gold mine.
ss of nep
(03/02/2000; 07:31:53 MDT - Msg ID: 26284)
This looks to be an interesting book - which is quite old
http://www.thecomingbattle.com/comingbattle_introduction.html


Cavan Man
(03/02/2000; 08:32:38 MDT - Msg ID: 26285)
American History
After the Bank of the United States was conceived by Hamilton and approved by Washington, there was a tremendous amount of speculation in the stock of the bank as it was heavily oversubscribed. "The speculation centered in bank scrip, that is, certificates for initial part-payments on bank stock, hence the terms that were bandied about at the time--"scrippomony", "scrippomania", "scrippophobia". Bank scrip was quoted at advances of from 100 to 300 per cent before there was a reaction." (This phenomena was compared to the famous South Sea Bubble in publications of the day.)

William Duer, an intimate of Hamilton and for a time the Assistant Secretary of the Treasury (as well as a fantastic financial "operator") eventually went to jail for various indiscretions relating to federal securities and specualtion therein. Writing in context to his son-in-law before Duer went to prison, Jefferson said:

"Here, the unmonied farmer (italics), as he is termed, his cattle and crops are no more thought of than if they did not feed us. Scrip and stock are food and raiment here. Duer, the king of the alley, is under a sort of check. The stocksellers say he will rise again. The stock-buyers count him out and the credit & fate of the nation seem to hang on the desperate throws and plunges of gambling scoundrels."

From Dumas Malone's Jefferson biography vol.II
Cavan Man
(03/02/2000; 08:36:13 MDT - Msg ID: 26286)
commodities
OIL @ $32
AU down

Good news! Dow and NASDQ up!
USAGOLD
(03/02/2000; 08:50:32 MDT - Msg ID: 26287)
Today's Gold Report: The Dollarization of Ecuador, the Ecuadorization of America, and Europe Tests Muscle
http://www.usagold.com/Order_Form.html3/2/00 Indications
�Current
�Change
Gold
291.40
-.40
Silver
5.10
-.02
Gold Lease Rate
0.4362%
-0.0300
Gold Comex Stocks
1,373,896
nc


Market Report (3/2/00): Gold seesawed between a down night overseas
(down about $3) and a respectable opening in New York (down about 40�).
FWN reports pressure on gold overnight from "one large New York trade
house." In a thin market, that's all it takes. In the past any dip to
the $290 level has been met by strong physical buying we will see if
that's the case today.

Following yesterday's reports of an 8.8% overall European Union
unemployment rate, the European Central Bank judiciously leaves interest
rates where they are frustrating the pundits who predicted a rate
increase to help the euro. Now the euro is free to descend even further
against the dollar. Ecuador dollarizes its economy at the rate of 25,000
sucre per dollar. The first plank of the dollarization plan calls for
"Ecuador's Central Bank to swap sucres for dollars at a rate of 25,000
sucres for $1." The question becomes "Who's the lucky entity that ends
up with all those nifty, illiquid, useless sucres -- the U.S. Treasury?
Ecuador's central bank? Another question: Where does Ecuador get its
dollars? Do we just wire them the money or do we get something out of
this? As for your typical Ecuadoran, I would suggest that it would have
been in his or her best interest to have swapped sucres for oil early on
since the price has just gone from 125,000 per barrel a year ago to
750,000 per barrel now -- that rate of increase is about double what
Americans are paying.

Oil it would seem is much better currency than the sucre, the dollar or
gold for that matter. Ecuador runs the risk of a major depression with
this dollarization, and now under the fifth dollarization plank, they
can't print their way out of it. This is what happens when you give up
sovereignty. (Britain take note.) At the same, if you are thinking about
your own defensive plan against Ecuadorization of the American economy,
some gold discreetly stored nearby will likely be the ticket. Oil has
limitations as a portfolio item. It has a tendency to take up space and
difficult to transfer upon sale, making gold the logical alternative.
Ecuadorans would be well served to consider what happens to their
economy should the rampant dollar printing continue. Dollarization might
have worked before oil rose threefold. Now it could bring on a
devastating depression.

By the way, Europe decided that Caio Koch-Weser's credentials were
substantially better than the Clinton administration realized. He is now
on his way to Washington for a visit (interview?). Reuters says that the
wrangling over the Europe's Koch-Weser nomination to head the
International Monetary Fund is "setting the stage...for a bitter clash
between Europe and the United States." To my knowledge, this is the
first time Europe has truly flexed its muscle since the Washington
Agreement on gold sales and leases in opposition to U.S. policies.

That's it for today, my fellow goldmeisters. See you back here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click the link above and make the appropriate entries.
Cavan Man
(03/02/2000; 09:21:43 MDT - Msg ID: 26288)
Trail Guide
How do you read the current oil market? Reports today say leading OPEC members see the need for "stability" in pricing. The price level was not specified.

In my business, prices can be high or low but TERMS other than price are often equally important.

OIL pricing, Koch-Weser, Euro depreciation, Iraqi intransigence, US "bubblemania", continued dollar hegemony (to date), China & Russia sabre rattling, (what am I forgetting?); how does it knit together in your view?
goldfan
(03/02/2000; 10:08:20 MDT - Msg ID: 26289)
Silver and Palladium, is the paper dead?

I see that TOCOM ( Tokyo) has capped palladium prices in order to "save the shorts". So the only liquid market for palladium appears to be the LBMA (London) where they use a twice daily price fixing mechanism that could be just to provide window dressing for the real deals which are going on behind the scenes at who knows what price. I guess this still does not save the shorts at TOCOM, just makes it unnecessary for them to attempt to buy right now. This makes it possible to hide from public view, the real trading price of physical palladium. I'm no expert, but this is what I surmise.

Now, Ted Butler (published on Gold-Eagle) has been in an exchange with COMEX (Chicago) about the data they publish that shows there are 4 traders short an enormous amount of silver, approaching a years output for the largest supplier of silver, Mexico. He says there is no way these naked shorts can ever cover. Certainly not with COMEX stocks. And he says, they are effectively capping the price of silver by shorting whatever amount they want, when the price rises. COMEX has responded to Mr Butler by saying that they rely on the 4 traders to have the necessary silver in their own warehouses, to meet the demand if they are ever forced to pay back their borrowings. COMEX is saying that it's ok by them if a few traders corner the short market. This means, as I see it, that COMEX is willing to allow the silver price to be capped by these shorters, until the physical demand gets so great their inability to cover becomes public knowledge. In which case, COMEX will simply change the rules so they are no longer responsible. And COMEX as a price discovery location for silver, will simply disappear, the way the TOCOM has for Palladium.

Am I right about this?? How long will it take for this to happen?? When it does, what will the effect on gold traders at COMEX be? Isn't all this real evidence that the COMEX paper market in the PM's is already effectively dead, as FOA and Another have predicted? And the data, for whatever it is worth, on LBMA sales volumes says they are going out of business too.

Why can't we have an open honest physical market in the PM's in this country? Why wouldn't the producers get together to form one, if no one else will? Farmers have been unable to save themselves this way, because of cheap imports, but what's stopping the PM producers?

Goldfan
Cavan Man
(03/02/2000; 10:17:10 MDT - Msg ID: 26290)
Retail Sales
Up 5.6% from last year.

Cavan Man (on the street): February is ALWAYS a poor month for retail; ANY kind of retail.
Henri
(03/02/2000; 10:46:03 MDT - Msg ID: 26291)
POG and silver weakness
When I watch this latest price action I "see" lots of paper being dumped on the market. Besides the big flurry of supply (J.P.Morgan exit?) there seems to me to be some question of credibility of this paper. With APR options expiring March 10, is this a move to the exit? If a jolt hits the gold market TOCOM style would futures contract holders want to put up the extra FRN's to meet margin? Perhaps an increase in FRN margin is more a measure of FRN weakness than it would be weakness in paper gold even with its possible quality question (Can this future delivery contract actually be delivered?)

I've said it before and I'll say it again. As the noose slips tighter the known good delivery forward contracts have already been snatched up at a premium (Last 2 weeks?). What are the balance of these contracts worth? Judging by the price they are commanding? Apparently...not as much.

When I say this is what I "see" it is more in the vein of a mystic. Any basis in what currently passes for reality? Only time will tell. Reality as society perceives it is often far different than what it is. My definition of reality is the here and now...constant change and a tendency to seek harmony with its surroundings. When those surroundings are chaotic. The changes will be volatile and of unanticipated direction. Expect the unexpected...prepare for the worst. As the night is always darkest before the dawn, so the day seems the brightest just before the sun "winks out". :-)
beesting
(03/02/2000; 10:49:57 MDT - Msg ID: 26292)
ALERT-Positive mainstream news release for Gold!
http://cbs.marketwatch.com/archive/20000302/news/current/stwatch.htx?source=blq/yhoo&distHope this URL works!
From news release:

Chris Thompson, a 52 year old Canadian who took over the leadership of Gold Feilds(GOLD) 18 months ago, says Gold will get its day in the sun."Some sort of collapse in the equity market is what is going to be the catalyst for Gold, we have had a secular trend,paper assets going up and hard assets going down, and that can't continue."


Those in the Know.....Buy Gold.....beesting.
beesting
(03/02/2000; 11:48:32 MDT - Msg ID: 26293)
goldfan #26248--Is the paper dead?
Good post, I agree 100% with your post.
I think the paper markets are operating the same as the fractional reserve banking system--Only a small percentage of participants want ownership of product at the same time.A run on product,which seems to be happening right now in Palladium,may be fatal for the paper market, if buyers realize what is happening.

I suspect what may eventually happen is this;
Automobile manufactures who are required to use Palladium, Platinum in new automobiles, and large users of Silver and all other raw products,including Gold,will bypass paper markets and purchase directly from producers.
This can be done very easily using cyberspace communications.Producers listing,product on hand, and prices.
With overseas products,guarantees of "good delivery" would be a little more complex.
In the U.S., and all of North America, with trucking providing door to door pick up and delivery of products.....WHO NEEDS MORE MIDDLEMEN???

Have to run now.....beesting.
Farfel
(03/02/2000; 12:42:11 MDT - Msg ID: 26294)
How I Knew Gold Would Not Go Anywhere in March
Steve Kaplan is bullish on gold and he is a categorical idiot, with 9 out of 10 predictions always wrong.

Or....

Steve Kaplan says he is bullish on gold but recommended notorious gold shorter slimebag company BARRICK GOLD, thus proving that he is really bearish on gold but speaks with forked tongue.

Take your pick.

Thanks

F*
Farfel
(03/02/2000; 12:59:26 MDT - Msg ID: 26295)
P.S. SELL BARRICK GOLD! (Heading for a NEW LOW...GREAT!!)
From Reg Howe to myself, many of us remained very cynical when chronic gold short BARRICK GOLD announced it had purchased multi-millions worth of gold calls with strike prices at 320 and 330 or thereabouts.

After all, who would write such a large amount of calls except some bullion bank/hedge fund sleeping in the same bed as chronic gold short Barrick Gold.

These Wall Street funds and bullion banks are used to vertical stock markets, cronyism, moral hazard, and uneven playing fields. They will sell their mother to a whorehouse before they ever "allow" the stock market to lose them a significant dime.

When I saw Barrick purchase the call position (WITHOUT taking any measures to pump up the price of gold at the same time), I pretty well knew the fix was in AGAIN.

As I posted earlier, the only scenario I could envision where some extremely wealthy third party/bullion bank/hedge fund would write such a huge gold call position for Barrick is one in which they desperately needed to raise cash via the call premiums.

However, such is not the case.

Now who knows how low the slimesters will take gold this time?

Anybody ready for 200?

Thanks

F*

TheStranger
(03/02/2000; 13:30:48 MDT - Msg ID: 26296)
Inflation Update
From the Wall Street Journal's coverage this morning of the NAPM report:

March 2, 2000
Manufacturing, Construction
Show Continued Expansion

By YOCHI J. DREAZEN
Staff Reporter of THE WALL STREET JOURNAL

WASHINGTON -- The manufacturing and construction sectors continue
to expand in the new year, defying predictions of a slowdown. Rising
prices for industrial commodities, meanwhile, added to worries about
renewed inflation.

The first economic data to be
released for February, the National
Association of Purchasing
Management's monthly index of
manufacturing activity, rose to 56.9
from 56.3 in January. The gain,
driven by increases in exports, new
orders and production, more than
offset a slight decrease in January.

February marks the 13th month the
index has been above 50, signaling
that the sector continues to grow.
Many economists fear that such growth could stretch the economy to its
limits. Indeed, the report showed continued increases in prices for oil, steel
and other industrial supplies. The index's closely watched "prices paid"
component increased to 74.1 -- a five-year high -- from 72.6 a month
earlier...

The NAPM numbers are likely to be noted at the U.S. Federal Reserve,
where officials remain on the lookout for any signs of inflation. Rising
energy costs contributed to the overall increase in input prices, but prices
for commodities such as steel, aluminum and chemicals also rose. Whether
those increases will be passed on to consumers, though, remains unclear:
The report found that many respondents fear they may not be able to raise
their prices in the face of strong competition. But the momentum for
broader price increases is clearly building, NAPM officials said.

"At this level of input prices, the potential for inflation has traditionally been
fairly strong," said Norbert Ore, chairman of the NAPM's business-survey
committee and director of purchasing for Chesapeake Display Packaging
Co. "We're in the type of environment where the next step would be for
intermediate prices to go up."

Stranger's Note: We still keep hearing about how hesitant business is to pass these higher costs along. Boy, if you live long enough, you see everything. I well remember when many businesses refused to believe inflation had been subdued in the early 1980s. Such businesses lost market share by continuing to push for price increases in a disinflating environment. Now we have the other kind of inertia where a body at rest tends to stay that way. But narrowing margins will force many companies to face reality and begin pushing up prices soon.

Peter Asher
(03/02/2000; 13:38:58 MDT - Msg ID: 26297)
It isn't over till it's over
http://hv.greenspun.com/bboard/q-and-a-fetch-msg.tcl?msg_id=002gaTY2K Homework #2, RonWortham@aol.com wrote:

WASHINGTON (CNN) -- The United States Air Force said Tuesday that it had grounded nearly 200 C-135 transport planes and KC-135 in-flight refueling tanker planes to inspect the aircraft for potential problems in a stabilizer part in the tail section.
>
> "Failure of the gear could result in a jammed stabilizer. As a result, the stabilizer could be stuck in a position that hinders the airplane from going up or down," the Air Force said in a statement.
>
> The Air Force said 198 of the Boeing manufactured aircraft are being inspected "as a precautionary measure due to a manufacturing problem discovered during an assessment" of the stabilizer trim actuator replacement procedure.
>
> The Air Force has 545 of the planes, which are a military variant of the Boeing 707 jetliner. The C-135 Stratolifter and the KC-135 Stratotanker are the only airplanes affected by the inspection. The Air Force also has more than 500 KC-10 Extender in-flight refueling planes.
>
> Air Force: 'No precipitating incident' led to grounding.
>
> The Air Force statement says that "there was no precipitating incident, accident, or system failure" that led to the decision to ground the aircraft for inspection.
>
> While some flights will have to be postponed or canceled for the time being, all high priority flight missions will be accommodated "by carefully managing the available fleet," the Air Force said.
>
> An Air Force official told CNN that the problem appears to be with a part that has installed in some of the airplanes since September of 1999. Those suspect parts will be replaced.
>
> The Air Force statement also says that the grounding and inspection are in no way connected with the recent crash of the Alaska Airlines MD-80" near the coast of California, in which all 88 aboard were killed. That plane's crew reported problems with the aircraft's horizontal stabilizer, and were
trying to correct them when the plane crashed. No official cause of the crash
has been determined.
>
> As a result of the Alaskan Airlines crash, the Federal Aviation Administration ordered inspections of the jackscrew assembly on all domestic MD-80 series airliner aircraft.
>
> The MD-80 was made by McDonnell-Douglas Corporation.
>
> --------------
> [COMMENTARY BY POSTER] (@greenspun.com)
>
> My take on this:
Last year they realized that the embedded chips in the trim actuator
system were not compliant, so they replaced them in September 1999. Now they have discovered that the chips in the new actuators are also not compliant, because the 2000 leap year was not written into the programming code.
>
> When they say there was no precipitating "incident" they probably mean nothing that occurred while in flight. My guess is that yesterday morning, Feb. 29th, several planes were started up to go out on their schedule flights. When they went through the pre-flight check, they discovered
that the stabilizer trim actuator was non-operational.
>
> After being sent the instructional signals from the flight deck computer referencing the date of Feb. 29 for its timing calculations, the chips simply could not accept that date, and just shut down. I doubt that they would otherwise weaken our national security by grounding all 200 planes at
once unless they had no choice. In other words, there is no way that these
planes could fly even if they wanted them to.
>
> -- Hawk (flyin@high.again), March 01, 2000

If you would like to be added to the Y2K_Homework mailing list'simply send an "Add me" statement to: RonWortham@aol.com<
Journeyman
(03/02/2000; 13:40:41 MDT - Msg ID: 26298)
Bubble alert: does ANYONE bet this ISN'T a bubble??

- Puts out-number calls on NASDAQ, etc. stocks by 7 to 1.
Bernie Shaeffer, Schaeffer's Investment Research, author "Options Adviser," -CNBC, 00/03/02, 10:44:34 AM

Regards, J.
CoBra(too)
(03/02/2000; 13:57:08 MDT - Msg ID: 26299)
F* - Kaplan turning bullish on gold - and
then recommending Barrick is an oxymoron - to say te least!
I agree with you (and won't start my PDG slamming again-after all they had a bad year in terms of earnings even equating their super-low "cash" costs -156$/oz- or such
a fair(y tale) figure, though they tremendously built up their reserves at lowest prices ever - W. Areas at $ 7.5/oz!!! and Getchell against lots of paper!), so does it matter if anyone turns bullish or bearish on "paper" gold.
I guess, and I'm sad to state I'm bullish on the physical
bullion fundamentals and sure hope some of the less hedged and juniors will still see their day in the sun - which they deserve, and not get right now. - And I can't and ever will accept this kind of blatant manipulation, where the manipulated are being held hostage instead of the powers to be - Clever? ... Only as long this clever scam can be held together, a scam already fraying at the seams - so is AG's
ploy to go to these kind of extremes - Tulipmania may have been about bulbs - they at least reproduce- while DOT-COM'S and BIO GEN'S only c l o n e!!! ... And they only clone, when fed by the adrenaline of money supply exaggerations.
Every day brings us closer to the final reckoning - when
Joe Doe (or Sixpack)- finds out it's not only champagne that bubbles - no, he'll be foaming (no Bud) about the loss
of all his "virtual savings" and will not revert to the solace of his bubble gum, without trying to 'Wrigley' out of
a scam implanted by 'big brother'. No way, I've been to the Paradise - I don't and won't accept your foul tomatoes from here on! WOULD YOU - CB2


Journeyman
(03/02/2000; 15:03:04 MDT - Msg ID: 26300)
A new market for gold?

- "3Com," maker of the Palm Pilot, just spun off "Palm Computing" today as a much anticipated IPO. The CEO of "Palm," Carl Yankowski, was wearing a brown suit, the material of which was interwoven with 24 carat gold. When asked if the gold in the suit was for real, he responded it certainly was and was in keeping with the belief of his company in its golden future. -CNBC, 00/03/02

Regards, J.

Cavan Man
(03/02/2000; 15:18:28 MDT - Msg ID: 26301)
CoBra(too)26299
What he said!
CoBra(too)
(03/02/2000; 15:46:47 MDT - Msg ID: 26302)
Your daily financial headline - from Bloomberg - an almost
conservative news service:
" Palm more than doubles in first-day trading after IPO;
3Com (the parent) declines 21% ....
Santa Clara, Cal., today, shares of Palm Inc., the hand-held organizer unit, a spin off of 3Com, is a bet on
pocket-sized PC's, providing wireless Internet and cell phone connections. Goldman Sachs arranged to sell a 4.1% stake (the smallest percentage ever issued to the public), though the market value at 1st. trading close doubles its parent and at 53 billion $, just barely beating Ford Motor Co's mkt value!
Nice Go! Now consider this IPO - Palm Dot Gold (you can't palm it), though GS is considering an IPO for 4,1% of its
gold (paper shorts) virtual bullion. Since this may be seen as the other side of the coin - it may be a thousand times undersubscribed ... and GS still makes a profit!?!
What's wrong with that equation? Or with me? Or with the rest of the world? OR WITH REALITY & TRUTH?! CB2




CoBra(too)
(03/02/2000; 15:53:15 MDT - Msg ID: 26303)
C&J Man - sorry didn't read before posting!
Slow type(r) - Anyway fed up with GS in all (back) alleys.
Farfel
(03/02/2000; 16:02:57 MDT - Msg ID: 26304)
Swimming in the New Paradigm: the Put/Call ratio
Journeyman (03/02/00; 13:40:41MDT - Msg ID:26298)
Bubble alert: does ANYONE bet this ISN'T a bubble??

- Puts out-number calls on NASDAQ, etc. stocks by 7 to 1.
Bernie Shaeffer, Schaeffer's Investment Research, author "Options Adviser," -CNBC, 00/03/02, 10:44:34 AM

----
It is very much a bubble upon a bubble.

But it is a much more sophisticated bubble today than in past.

Today's more savvy, CNBC-educated, Nasdaq investor rarely buys tech stocks anymore without either writing calls or purchasing puts, JUST IN CASE.

The loss of any expired puts premium is far outweighed by the gain in purchased stock value.

Today we have thousands upon thousands of very bullish investors who buy puts right and left solely as "insurance," hoping or expecting that they will expire worthless against the soaring stocks they own.

In other words, the put/call ratio in this market is complete meaningless today.

Yet another historical ratio that serves no purpose in a vertical market. When the stock bulls finally figure that out, well....ooops.

But you'll never hear about that from Louis Ruykeser and his ilk.

All part of that New Paradigm, you know

Thanks

F*


Cavan Man
(03/02/2000; 16:04:06 MDT - Msg ID: 26305)
Dollarization of Ecuador
I believe one of the country's primary exports is oil. Likewise, I believe South America does have some interesting exploration projects developing. Of course, Canada has lots of Natural Gas.

Chalk up another win for the dollar.
Galearis
(03/02/2000; 16:13:46 MDT - Msg ID: 26306)
an "inflated" POG
I don't know if the CABEL crowd are believing the party line or not about inflation (the one about there being none), but if one were to conservatively assume an inflation rate in dollar purchasing power amounting to 5% less than a year ago then wouldn't that really put the NY close at a few bucks over gold's all time low ($254). Factoring in inflation on the $287.50 close would then be make this $258 in 1999 dollars.

Am I wrong about this, or if correct - wouldn't someone with very deep pockets and a golden appetite consider this a nice buying opportunity? Of course if I'm wrong and the shorting and foreward sales push spot much lower, we may be entering uncharted territory again.....

In other words (and assuming I am right) the bottom should be in right about now! Right. Right?
Solomon Weaver
(03/02/2000; 16:28:00 MDT - Msg ID: 26307)
buying opportunity
Galearis

Your 5% inflation calculation and "buying opportunity" are based on the mindset of someone who would buy gold without margin, taking delivery (at least to a semi-private vault).

What you should remember that the POG as we see it is primarily determined by paper traders with highly leveraged positions and short time horizons...and the paper volume is the volume that moves the POG today.

Since you mentioned that you are looking for a safe way to park a million dollars...you should personally consider taking delivery...then on that day...YOU just might really make a small difference as your 3,000 ounces leave the COMEX vault. (smile)

Poor old Solomon
4Ducat
(03/02/2000; 16:38:39 MDT - Msg ID: 26308)
"All the News that is Fit to Deceive Us"
http://www.usagold.comHey Waldo! Maybe that's why this airplane has been so hard to fly. We've been telling the passengers that it was a lot of "air turbulance" when actually we've been flying around for two months with no rear stabilizers! Look don't tell anybody that the computers are dysfunctional just find a worn bolt and say some threads are bare. Good idea the planes will be grounded for one month until we change the worn bolt in the stabilizer. That's a long time to change a bolt isn't it. No, that's the rare $750 bolt, ASTM stress tested, there aren't many of them left. I'm sure glad we don't have to learn about computers. Me too. We're pilots. I got my job.
..........................................................

If you have to fly, go Greyhound!

..........................................................

I see the paper gold and silver futures contracts settled in cash as like off-track betting. They only effect the POG when actual delivery is taken. Only the movements of physical PGMs actually effect the supply and demand equation. Failure of the writers of the options who promise to settle in cash, should in time make such investment vehicles too high risk. In a derivative market shakeout their would be a mass exodus of options holders who would be settling in cash. Or they would sell them at a discount as junk bonds do. They'd want physical delivery when the value of storing the metal surpasses the risk involved with holding gold paper, the would be "junk paper gold". Until we have a few "shorter's bankrupcies" then the present derivatives casino could keep going on. We need to hear something like "gold paper was downgraded today after major banks #1 #2 and #3 are said to be insolvent". One announcement to bail out failing major banks would send a tremor of an earthquake through the markets. The Fed is just going to "print up" a few trillion to save the present system? Catch 22. That would be exactly the same as devaluing the currency. Like 25% inflation one time with the stroke of a pen.

Necessity is the mother of invention. When that happens you'll see businessmen wanting to offer a "gold service" for the rich who want to physically own gold but don't want to hire an army to guard it at their house. Owning gold through a trusted company would become popular. Certain trusted companies will see the profitability potential of real gold banking. They would make loans on gold held as collateral. The complex US "BS" banking system should evolve into a more trustworthy system as the need becomes so real. Runs on banks would lead to such a system as "private gold banking". Weak systems naturally become replaced by stronger systems. As weak cultures become "driven out" by stronger cultures. Like the fish called a bowfin will drive out the bass in a lake. So bowfin are hated fish because they are too fierce and competitive and too worthless to eat so they can't be "fished out". A bowfin is a prehistoric type fish in freshwater but has teeth like a bluefish. He's your original goldbug of a fish, A real survivor. Gold is the king of investments but the king is in exile, dethroned by the paper pushers. The emergence of real gold banking should come about as a natural process as the paper pushers of fiat currency become dethroned from a failure of trust in them.
So this is my treatise for down market days. The derivatives casino is the Titanic and the consumer credit crisis is the "I SEE berg". They are going too fast and the ship will hit the Iceberg. In the midst of a party they will see the water around their ankles. Then your papermoney can't save you anymore than it can save me........You may have some gold...but is it enough?
Solomon Weaver
(03/02/2000; 16:40:04 MDT - Msg ID: 26309)
outside the paper market
I suspect what may eventually happen is this;
Automobile manufactures who are required to use Palladium, Platinum in new automobiles, and large users of Silver and all other raw products,including Gold,will bypass paper markets and purchase directly from producers.
This can be done very easily using cyberspace communications.Producers listing,product on hand, and prices.
---
Beesting The miners and the users will want to both feel the price is fair...and this will require an open market...which no matter how physical, will soon contain some amount of paper....

I think what will have to happen is a new paper market which has "rules designed to serve parties interested in purchasing for use". There will have to be a lot more transparency and a lot less financial risk takers...who don't have money and gold (other metals) backing them up.

Poor old Solomon
Jason Happy
(03/02/2000; 17:15:44 MDT - Msg ID: 26310)
The collapse of the paper markets has begun!
RE: goldfan (03/02/00; 10:08:20MDT - Msg ID:26289)
Silver and Palladium, is the paper dead?

Goldfan, you hit the nail on the head with this one. This is the very thing we have all been waiting for, as per the Another/FOA forcasts.

True, the collapse hit Palladium first, but it's there. A limit on what you can sell your paper for? Doesn't that sound a aweful lot like the collapse of paper in the 1933 US scenerio... "you must redeem your gold now for paper at the set price" or risk becoming a felon... Soon thereafter, gold jumped from $20/oz to $35/oz, but it was still illegal to own it. And this revaluation was still too little, otherwise confiscation would not have been necessary to pay off forign holders of dollars!!!

So, does this mean that real prices of palladium should almost double, or more than double soon??? When will similar rule changes hit the COMEX... spelling the doom of these fraudulent paper markets. Soon, it seems.

jayzee
(03/02/2000; 17:30:11 MDT - Msg ID: 26311)
What would make the price of gold rise?
I have tried to think of things that would raise the price of gold. (1) EU buying to increase their gold reserves to 30%. This would strengthen the euro if that is what they really want to do. (2) Swiss reduction of their projected gold sales. The Swiss seem to want devaluation of the S-franc so their manufacturers could better compete. However, insurance/financial markets bring in a lot of money
One of the selling points of Swiss annuities is the increase
in the payback in US$ from the changover from a stronger Sf.
So the Swiss may be hurting themselves by selling gold backing their currency. I hope some Swiss citizens will read
this change their minds.
RossL
(03/02/2000; 18:15:54 MDT - Msg ID: 26312)
Paper Palladium Market
http://www2.marketwatch.com/intchart/default.asp?source=htx%2Fhttp2_mw&symb=swc&menus=&mnuTimeFrame=open&mnuCompareTo=closed&mnuIndicators=closed&mnuChartStyle=closed&time=5&freq=1∁symb=∁idx=aaaaa%3A0∁ind=aaaaa%3A0&ma=0&maval=9&uf=0&lf=1&lf2=0&lf3=0&type=2&size=1Poor Old Solomon, Goldfan, Jason,

Interesting post on the silver market, Sir Solomon. - Msg ID:26272 - It seems to me that the paper palladium market is detaching itself from the physical market. If it is doing so, then I theorize that we can watch the current palladium events as a roadmap for what is to come when the paper silver and paper gold markets come apart at the seams. Limit up days, followed by changing the rules in favor of the shorts, followed by declining paper prices with no physical available. What's next?

Also, notice that Stillwater (SWC) stock peaked with the paper market in palladium. Gold and silver stocks may not be a fun place to be when the paper gold and paper silver markets start to fail.
ORO
(03/02/2000; 18:27:32 MDT - Msg ID: 26313)
CoingGuy - Funds
http://www.yardeni.com/public/shspr_c.pdf
This is a bit of enlightenment. Particularly page 9.

The relative strength of industry groups within the SP500 relative to the SP as a whole.

The driver has been Tech.

Since 1993-4 all of the real economy stocks have been underperforming with these exceptions:

Telecom was up 1997-1999 and has faltered since mid 1999.

Health care took off in 1993 and hit a peak in Apr 1998. Presumably, this was part of the reason for the rest of the economy to go down during this period relative to the rest.

Financial stocks peaked in relative performance in Apr 1998.

Technology stocks have been on a sharp parabolic rise that continues accelerating in nominal terms - and relative to the SP.

There is some indication of why this is hapenning in the following URL:
http://www.yardeni.com/public/fofchrt.pdf

On page 2 we see that the government's share of borrowing has fallen consistently since 1992 - the one good Clinton policy. Driven, no doubt, by the decline in military spending and by the government income from the equity boom.

On page 3 corporate Capital spending is compared to cash flows. Companies make money when investment is below capital requirements. That has not been the case for the period 1994-onwards and particularly since 1997. Currently, the capital expenditure is outpacing cash flow by 12% and over $100 Bil.

Since 1994, corporations have been borrowing and buying back stock. The IPO fever of the past few years has done nothing to reverse these trends, just enough to stop their further growth. (Page 3 - bottom chart)

Pages 4-6 show how strong borrowing by financial corporations has been, and how disconnected that borrowing has been from the non-financial corporations. The 1994 date follows the change in spreads between Japanese and US rates that spawned the Yen carry trade. The carry trade operates through financial corporations. They borrow in dollars from Japanese banks that buy their bonds. The Japanese banks pay 0.5% today, and it costs them 1% to process a bond purchase or to make a loan. The rest of the interest rate differential with US rates is profitable as long as the Yen does not appreciate considerably vs the $.

This can be remedied - (Yen appreciation) - by the increase of $ interest rates. However, the financial flows this interest rate differential causes will necessarilly cause a growth in outstanding $ debt borrowed in Yen. The period 1993 through Apr 1998 was characterized by the growth of this debt as Japan constantly lowered interest rates - now to near 0. The resultant debt produces an interest payment stream that joins with the Japanese trade surplus to make the flow of investment funds from Japan ever greater. Raising the $ interest rates produces a higher interest payment stream in $. At some point, there will be no interest rate at which a sufficient amount of new Yen/dollar trades can be generated to cover both the trade deficit and the interest payments and the dollar will tumble as the Yen appreciates and then stabilizes.

The Non-Financial corporations to whom the banks participating in the carry trade lend, have been using funds to buy back shares at a rate nearly equal to that of the financial corporation's borrowing and their own borrowing, at about $270 billion equity purchases, $240 bond issuance (to pay for the stock) and $300 billion borrowed by financial corporations to lend to Non-financials or their customers. Pages 5-6

On page 8 of the flow of funds chart book, the household sector is seen selling stocks and buying bonds. - The exact reverse of corporate actions. Though Yardeni attributes this to M&A, this is actually what it seems - though the flow is dominated by corporate ESOPs which have reached a level of some significance in the economy at some $300 billion annual redemption. Some of the estimates bring this up to $440 billion for 1999.

Looking at the page 8, the mutual fund flows indicate a peak reached in 1996-1998 at a rate of $175 billion. When added back into the household sector - this comes out to a net withdrawal of $350 bil. in 1998 and a net withdrawal of $275 bil. in 1999. I dare say that these amounts correspond to the options redemptions. Though the options redemptions would be expected to show a rise with tech companies (the greatest users/abusers, second only to financial corporations) rising as steeply as they have in the past 2 years, the total market has been on a decline since April 1998, to show a 20% decline through 1999.

The budget deficit (net of interest on the national debt - page 14) turned into surplus in 1994 and continued a trend of decline that started in 1992 - exactly when the household sector started selling their equities. Thes sales are by corporate stock option holders. The buys are on the corporate side, buying back the stock they issued. This accounts for the whole of the Federal and state budget improvements since then. Though the Fed and Congress' CBO will not say so outright, this is the source of the US governments balanced books. The source for this is US corporate borrowing, and the source of funds for the borrowing is foreign funds, predominantly created through the carry trade with Japan, and some from Europe.

On page 9 we see that there is a massive escape of capital from the US ($300 billion - breaking out of the $200 +/- 10% range of 1993-1998 and continuing a trend from 1992-3) that is balanced by net foreign investment in US equities ($50-60 billion - up sharply from Apr 1999 - bottom page 12) and as a whole by foreign direct investment rising from the uptrend of 1992-1997 that led to $100 billion, and from there rising steeply to $340 billion in 1999.

Government insured securities ("agencies") and mortgages shown on page 15 are up to $630 bil (sum of both) in new debt issued. That is up from the $140 bil of the 1980s and early 1990s and $240 of 1994-1998. The debt splurge is on with a vengeance. The consumer is joined by municipalities and state govs that have resumed high borrowing levels not seen since their 1985 peak borrowing (pg 16).

Added to the spending boom of the boomers on housing - funded by the sale of stock from ESOP programs - they are drawing on their treasury holdings to pay for their mutual fund purchases (page 17). The similarity of the sums is not
a coincidence.

Some of the reasons for this can be seen in the outstanding consumer debt levels relative to "disposable income" which is stable at 24%. What this says is that people have been maxed out since 1995 - which also marks the end of corporate profit growth acceleration and the start of the steady growth phase, which has ceased in 1997 and turned negative in 1999.

To summarise:

The source of the US bubble is:

1 US demand due to boomers in their peak spending and earning years.

2 Debt pushers in Japan (2/3) and Europe (1/3) recently joined by the NICs (Korea Singapore Hong Kong, Thailand, Malaysia, Indonesia, etc. and China) who now support 1/4 of new US debt.

3. The US insistence on the dollar reserve system, which dates back to 1942. (3a) The support of that system by the governments of Europe, Japan, and the oil countries. (3b) Outside of coordinating interest rate policies with Europe and Japan, the US has left the dollar reserve system to the Europeans and the Japanese to determine as their needs dictate.

4. The cheap funds from Japan (mostly) and from Europe, have induced massive borrowing by the corporate sector and an insensitivity to local US interest rates. The Fed has little control over them because the Fed is not the world's low cost loan originator.

5. The cheap debt is used by corporations to run ESOP plans that give the company's earnings and assets to executives and high value techies. The ESOPs produce a supply of shares that the corporations buy back by issuing debt.

6. The ESOP shares are sold and the proceeds are invested abroad and spent at home as well. The Federal government surplus is funded by income taxes on these ESOP funds.

7. The US imports products and exports dollars in the form of product payments, capital, and interest payments. These total to a $700 billion net annual supply of dollars to the world. The world is using only 2/3 of that sum to buy US securities and to invest in US facillities. The balance is swalowed by the international debt markets and used to extinguish dollar debt.

8. The dollar supply is also used to form Euro debt from dollar debt, and is responsible for much of the dollar's appreciation since late 1998. The Euro debt has taken 50% or more of the international debt markets, squeezing the world for dollars. (Dollars are created as a result of new debt creation and the demand for dollars comes from interest and principal payments due on old debt). This has forced the Fed to allow incredible monetary and debt expansion in the US, and they raised interest rates to attract foreign dollars from leaving the US and flooding the world.

Dollar debt outside the US was at $21 trillion in 1999's onset. By the end of 1999, it was only $22 trillion. Raised by only $740 billion of new debt. The Euro debt raised in the same year - $550 billion or so at then current exchange rates - displaced that number of dollars from creation. The $21 trillion would have necessitated at least $1.6-1.7 trillion growth in dollar debt outside the US just in order to pay interest. This had the result of raising the dollar's value throughout the year in other currencies, most notably in Euro. Furthermore, it produced a $1 trillion deficit in foreign dollar debt markets. This deficit is being filled by US borrowing - which has proceeded at a record rate of $1.1 tril.. The US moved some $700 Billion out of the US to supply the dollar demand - of which sum only 2/3 came back into investment and securities - meaning that some $250 billion were used to cover foreign dollar debt. Expect the US oil expenditure to continue in contributing to this disaster of global dollar debt repudiation and the resultant coverage of the foreign dollar debt with dollars created within the US - where they will create price inflation.

Note on the Asian crissis:
The Asian Tigers had been borrowing in Yen and in dollars for the period 1990 to 1996 at $15 billion a year. This was invested in capital equipment. Interest rates contracted were in the 14%-18% range vs. 7% in the US, 4% in Europe, and 2% in Japan. Other developing nations did the same at an average rate of $50 bil. annually. By 1997, both groups were in a bad deficit and the pulling of credit by Japan in response to the BIS tightening of capital standards for banks pushed the NICs and then the other developing nations into financial chaos as no dollars could be had to roll over their loans due to the exit of Japanese banks from these markets.

The resulting shock sent NIC monetary flows into reverse, and they have now a $140 to $150 billion annual surplus which will eliminate their dollar debt soon. Other developing countries have brought their borrowing to near 0.

This stream of dollars will now be targeted for oil purchases at a new higher price. Eventually, after a possible retraction and stabilization, oil should trade at $45 per barrel. The US trade deficit and investment outflow will come to a $450 tril. BOP deficit for 2000 - a time when exports will improve greatly, if the tear with the EU is healed. If it is not repaired, the EU will pull the rug from under the US dollar and let the global dollar debt default. A default rate of 8% per year will eliminate the debt completely in a few years. 1999 saw only a 1.5-2% default rate (by Russia and Brazillian provincial governments and by corporations in developing nations and NICs, remember Daewoo?). I don't believe Japanese banks will be able to come close to picking up the slack if the EU withdraws dollar support as a result of a currency war.

The case of cooperation will allow a steady decline in the real value of dollar debt outside the US, and thus allow the Euro to take over the US dollar's role through a partial conversion of this debt into Euro debt. This will allow the EU to run a trade deficit during the old age of its boomers without the creation of EU debt deficits. When the stabilization of the new system occurs - in 2005 or so, the world will be a different place but still functioning much like it is today. Gold will appreciate as it is the cornerstone of EU monetary policy to retain gold reserves and to manipulate gold prices upwards to allow printing of cash Euro not backed by debt.

The case of monetary warfare of the US with the EU will result in there not being ANY currency remaining in wide use for financial settlements. There will be a devestation of all currency denominated assets everywhere, only gold would then be used for international commerce, and its value will outstrip anything we have ever discussed on this forum. There may be a success of sorts in maintaining use of the dollar for petty purchases and daily spending in the US, but is would not retain any significant role for savings and denomination of debts. It will be skirted for any long term or large denomination transactions.

In any case, once significant price inflation is noticed by the participants in the new internet business exchange sites, they will start maintaining inventories of the useful items that bear the lowest cost of storage but have the best price stability, perhaps Boeing will hold an inventory of 64 MB DRAMs to park its funds between purchases of necessary parts till they notice that their prices are unstable and trend down relative to other items. This will eventually lead to the same place to which it has led in the past - to the use of gold and silvewr - perhaps with other rare metals to store purchasing power over time. Eventually, government control of the definition and the character of money will completely fade. All attempts by government to control this will be circumvented. The lack of legal protection for contracts denominated in gold or any other commodity is not going to prevent its use for debt denomination, it would simply sever the connection between the government's legal system and the real world. Unofficial arbiters will come to the fore to replace government arbiters. Government guarantees will be recognized for the worthless promises they have always been. Furthermore, any reluctance by some countries to enforce contracts that interest the markets will simply be another small element to push people and business to the countries that will enforce them.

The old "industrial" limitations are no more. The Bahamas and Mexico can provide just as good a business and living base as any industrial nation. Quite frankly, the emerging nations offer better productivity (when figures are restored to account for purchasing power parities), smaller government tolls on business and personal income of high value workers, and far greater potential for growth. And, by the by, the internet is programmed and maintained in India and Tel-Aviv, it is only managed from Silicon Valley.

The internet will not be the salvation of the US, it will be its undoing. Pressure on the dollar or higher taxes will stop the global brain drain into the US and cause it to reverse. The favorable treatment of tech company taxation through the ESOP trick is just a symptom of the decline in government power to effect unbalanced taxation - had the ESOPs been taxed in the usual manner, the top workers and the core businesses would have been in Jamaica by now.

beesting
(03/02/2000; 19:39:05 MDT - Msg ID: 26314)
Organized Crime on Wall Street!!!
http://biz.yahoo.com/apf/000302/mob_on_wal_1.htmlPlease read the above URL and then decide Who are the good guys and who are the bad guys???
......beesting.
Gold Trail Update
(03/02/2000; 20:15:21 MDT - Msg ID: 26315)
The Gold Trail Discussion has been Updated
The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
NewGold
(03/02/2000; 20:33:44 MDT - Msg ID: 26316)
Tzadeak has posted again for those interested.
TZADEAK* @ Realities
Copyright, All Rights Reserved 3/2000

@ Behind the Frontlines of the Currenciy WARS......

The Battle of Kaputt (Khol) has now spread to France,
however Francois Mitterand the co-architect of the "EURO" is dead so "they" have picked out his closest
friend/advisor "Duma" for "criminal" prosecution.......
Germany is making "noises", it's standing by it's
appointment to the IMF" Mr. Ciao" who today won an
"informal" vote as the IMF Chief, he favors more European
"say" in world affairs including "help" for developing countires.....Also Germany's Defence minister in Moscow
said today that Russia was "justified" in it's war with
terrorists "Chechians"....I don't believe the Yanks are
amused at all....
In the Euro "interest war zone" the ECB did not raise
interest rates today, ECB Pres.WARNING however that the
"fall" of the Euro was a growing "concern" since it could
impact on the concept of Euro Union vis a vis England's
participation, in addition to being a "psychological"
downer or words to that effect.....'they" have also been using the YEN to help attack the "Euro".....On the other hand the low Euro has helped Germany especially, the worlds BIGGEST exporter raise it's exports almost 10% last
quarter......BUT the EURO must get back well above US$
parity.....
Predictions.... ECB to "talk up" the Euro.....AND if
"they" don't co-operate I predict a 75% chance
of 2nd European "surprise" ( a la washington agreement??)
to drive Gold higher thus lowering US$.....

OH so much to write about so little time.....@ Oil....

My Prediction last month re OPEC increasing production
by about 1 Bill Barrels/day is about done,,,,you can just
about stick a fork in it,,,,, This will mean very little ,especially
US$ price of gas in particular since it takes about 3-6
month to process same....look for US$ 2 Gas by summer...
the POO will come down to about 25-27 US$ BUT
will NOT stay there as world economies pick up steam
and As I predicted last month look for Saddam"s
Sept/October "surprise" Oil cut off.....Add also the
fact that this is an election year in Mejico and the
Venezuelanos workers are NOT happy campers....
Saudis will likely make up most of OPEC Oil increases....

@ Souf Afrikka.....Nature's devastating "floods" will
not only kill many innocent/poor but the water are
"seaping" into the DEEP Mines of SA so far a few
mine shafts "flooded" including 2 at Durban Deep.....
But this may be a temporary? problem, the BIGGER
problem is "PUNZILE" the SA Mines Minister who
proclaimed this week that the 21st Century will
belong to "Black" MINERS, announcing a series of
proposals that would see "permits" for mineral rights
handed out much more to "blacks".../NO wonder
all those SA miners are leaving for Canada/Australia et al....
BTW she also "floated" a "tax" on mining dividends....

@ China/Taiwan.....

THX-1138
(03/02/2000; 20:49:49 MDT - Msg ID: 26317)
They sure write a lot about a worthless piece of metal.

NEW YORK (CNNfn) - With interest rates rising, an oil-price boom and the market at scary highs, cautious investors who remember the '70s might find their minds wandering to safe, reassuring gold. Forgotten what it is? Who could blame you? The only safe and reassuring thing about gold recently was that investing in it would lose you money. Old-timers might keep 2 percent of their wealth in bullion but the rest of the world steered clear. And it was a wise move. "As long as people are comfortable with financial assets and they've done well, they ignored gold," said Jean-Marie Eveillard, portfolio manager of the First Eagle SoGen Gold Fund. "And they've been right to ignore gold for quite a while." But if inflation picks up, governments back themselves into a corner and economic chaos breaks lose, gold will be an asset to remember. Eveillard has often considered closing his fund. He decided to keep it open after the Long-Term Capital Management debacle. "Maybe the world was more fragile than it appeared to be," he recalled thinking. If a financial crisis like that ever gets further out of control, "maybe it [his fund] is a cheap insurance fund."

An out-of-favor asset gets a boost

Central banks around the world, which collectively hold around 30,000 tons of gold, have depressed its price by selling consistently in recent years. Gold had also been depressed because gold mining companies have tended to hedge by selling gold "forward," ahead of its production. The strategy makes sense if they fear the price will fall -- and who could blame them, having lived through two decades of precedent. But they sold at a discount by hedging. Finally, the mines started to realize their hedging and apparent lack of confidence was contributing to gold's decline. Gold has recently received a double boost. Last September, the European central banks announced they would restrict their gold sales to 2,000 tons over the next five years. That removed uncertainty about how much gold could flood the market. And governments are showing they still have a place in their vaults for it, to back their currencies. Then, earlier this year, major gold producers such as Placer Dome, Anglogold, Gold Fields and Barrick Gold announced that they were scrapping or scaling down their hedging activity. Those two effects have helped boost the price of gold. There's now a third driver - when another commodity such as oil starts skyrocketing, other commodities often rise in sympathy. Gold hit a four-month high in February.

Handling gold for inflation insurance

What's the best time and way to use gold as an investment? Gold is famous as a hedge against rising interest rates and, more specifically, inflation. But after a run in it in the '70s, it's still not much of an asset to get excited about. Bill Martin, portfolio manager of the American Century Global Gold Fund, agrees with Eveillard that gold is best used as "insurance," particularly against inflation. But even when interest rates are rising, gold doesn't always benefit. Gold proves its mettle when the nominal interest rate set by the
Federal Reserve is very close or even below the rate of inflation. Even though the nominal rate of inflation is rising now, inflation is very low, around 2 percent, so that's not the case now. The best time for gold is when "real" interest rates, interest rates minus inflation, are around zero. Only if Alan Greenspan lets the economy escape his grasp will that happen. "It really should be a very small holding," Martin said, comprising perhaps 3 percent to 5 percent of assets for people who are trying to maintain their wealth. Perhaps its best use is for older people who are more worried about preventing their assets from depreciating rather than trying to grow them.

Bullion is for the birds

Financial planners and other experts are not so sure it belongs in a portfolio at all. "If somebody is super-wealthy and wants to be super-safe, owning some gold is fine for them," said Don Boegel, a certified financial planner in the Minneapolis suburb of Plymouth, Minn. But for normal people, he doesn't see the use. Even for the super-cautious, "I personally don't think they'll see a significant rate of return on it," he said. The last time he recommended owning gold was in the mid-'80s, after high inflation and poor stock-market returns spooked investors in the '70s. "I'd always have a piece of it there," usually less than 5 percent and never more than 10 percent of a portfolio, Boegel said. Boegel suspects the inflation of the mid-'70s may never happen again. "It's been years since I encouraged people to own gold," he said. He now tells his clients to look for other kinds of assets that tend to perform well under inflation, such as real estate. Real estate investment trusts, which pay hefty dividends, make a lot more sense than gold, he said. For people who are leery of real estate but worried about inflation, looking for hard assets as a result, other commodities may prove the answer. "If we were in a super-inflationary period, like some suggest [we're in], it would be better to have a tanker of oil in your backyard, or a bushel of wheat," said Robert Stein, president and senior economist of Stockbrokers.com. Unlike wheat or oil, almost every ounce of gold produced remains in supply, he pointed out. A composite commodity mutual fund may be the best answer for people looking for an inflation hedge, since it minimizes exposure to one particular commodity. Gold makes the headlines every now, as it did with its highs in February and in October. But because gold has basically been on hard times for so long, a short-term peak "is really a meaningless statistic for me," Stein said. "It's really coming from such a basement price."

Raising the standard with gold stocks

Investing in gold stocks is less conservative, but that defeats the "insurance" value of investing directly in bullion. They see greater gains than the metal if gold increases in value thanks to their leverage. Think of it this way: A gold mine spends $300 to produce an ounce of gold. It sells it at $325 for a profit of $25. If the price of gold rises to $350, the mine's profit increases 100 percent to $50. But the price of gold has only increased 7.7 percent. Of course, the downside is equally severe when the gold price moves against manufacturers. Gold, which closed at $293 an ounce on Wednesday, has increased 11.5 percent since its 20-year low last summer. So gold experts would normally expect gold stocks to rise between 28 percent and 35 percent as a result. Instead they have declined around 6 percent since then. Martin explained that investors are worried that gold-mining companies have overhedged their positions, even though they have now scaled the program down. If they're overhedged, if gold increases significantly in value, they stand to lose more money through covering hedge positions they've sold than they stand to gain in the increase itself. Martin thinks the concern is overdone. "This seems like a safe entry point for gold shares," he said. When discretionary money flows into gold stocks, it tends to move only into the big-cap companies, where it is easy to get back out again. Gold producers Barrick Gold, Anglogold, Newmont Mining, Placer Dome and Freeport McMoran Copper & Gold, all have market caps of more than $2 billion, and are the biggest components of the Philadelphia Stock Exchange's Gold and Silver Index. Anglo American, which trades in
London and via American depositary receipts, is the biggest gold company in the world. But Martin thinks mid-cap gold stocks are particularly undervalued, because they have suffered from both the unpopularity of gold as an asset, and because of the market's penchant for large-cap names. Companies such as Agnico-Eagle Mines, Meridian Gold and Goldcorp, Estimates are all "undervalued with good growth potential," he said. They rise after their big-cap peers, and right now they're the cheapest and have the most leverage, Martin continued. But they will be less liquid and tougher to sell. Small-cap gold stocks are too risky and too tough to sell for individual investors, gold experts say. Gold stocks still need something to get them moving, though. Many asset classes and out-of-favor sectors have idled while a narrow slice of the market captures most investors' attention. "Things can be undervalued for a very long time, as we've seen," Martin said. "You need a catalyst. And that's hard to predict for gold."
Galearis
(03/02/2000; 20:55:27 MDT - Msg ID: 26318)
@ Solomon Weaver
Yes I do realize that the POG is a paper driven derivative creation, but the point of my discussion really is that physical gold, at least in smaller weights can be purchased at these prices. The depressed price is an indirect benefit of the shorting pressure that benefits the small gold bug investor. I don't know where you got the idea that I had a million dollars to invest in physical (unless you have psychic abilities and were wiffing a constant daydream of mine).

The other point is that for all the angst about what the gold market is or isn't doing (right), many seem to forget what the dollar is currently worth this day in comparison to what the gold and dollar was worth a year or more ago. For example, during the last gold bull when people commonly point to gold reaching $400 plus per ounce in 1980, they forget that the dollar is worth less than half what it is today. That $400 is equivilent to $800 today. So when one hears that Robert Mundale (sp?) is predicting an equilibrium price of only $600 is he setting this figure into the subconcious of the potential sellers of physical gold in the future at this price - or is he being straight with the public. At any rate inflation, estimated conservatively at 5%, should really be a factor right now in this comparison for gold spot lows of a year ago. One wonders if the buyers and sellers are factoring this in in their trades.

It will be interesting in a year or two (?) when the US dollar begins to fall to see how people juggle this additional variable.

I do hope the Euro will make a timely physical entrance into the actual currency environment so that I can rotate from gold sales into the Euro in lieu of the US or Canadian dollar. I also expect open financial war between the Euro and the US dollar camp when the Euro takes physical form. I think this infant Euro that is still currently travelling down the birth canal is still to fragile and entity to risk for the ECB to intervene in a more overtly positive way to help gold. I believe they sit back and let US market mania in the derivative trades do the work for them.

I do not trust digital Euros. I do, however, have much more confidence in a Euro that may in the end be much more supported by gold than many here would believe. We shall see what this support level will be once gold has settled into its true equilibrium.

Solomon Weaver
(03/02/2000; 21:06:22 MDT - Msg ID: 26319)
and more on the silver shortage
RossL (03/02/00; 18:15:54MDT - Msg ID:26312)
and to all
-------
I spoke with the VP of Corporate Relations at a silver company today, who had just come back from the annual precious metals meeting sponsored by (I believe) the CPM.

A few things which were confirmed:

1. The silver world (producers and I assume also BBs) believes that Warren Buffet Still sits on 130 million ounces and that most or all of it is in his vaults.

2. The official Reserves have not grown since 1998 when they were only 200 million ounces....It is estimated that if one includes "non-official" sources of silver, by this I assume they mean small private ownership of bars and junk coin (not jewelry and flatware) that the total reserves available to the market are about 350 million ounces. My read on this is that MR. BUFFET MAY ALREADY HAVE A CORNER ON WELL OVER 50% OF THE "OFFICIAL" INVENTORY. By now, major silver users should be shaking in their shoes hoping that Mr. Buffet is kind to them...

3. About 70% of newly mined silver comes as by product from companies who are focused on other metals (gold, zinc, copper, lead). These companies have consistently forward sold silver (sometimes 5 years entire production forward) because they prefer a non-volatile income stream of that element of sales (silver), given that in their primary metal they need to stay in the more volatile "spot market". Solomon's opinion here is that this means that it will be VERY HARD TO INCREASE SILVER PRODUCTION worldwide unless significant demand for all commodity metals increases accordingly...particularly bullish would be economic slowdown, less steel and copper required, less silver produced as side product. At the same time, silver investment demand rising.

Well dear knights, I think the season for a great joust is upon us...history is in the making.

Poor old Solomon


lamprey_65
(03/02/2000; 22:29:35 MDT - Msg ID: 26320)
Solomon
In reference to Buffet's silver position, found a post on Kitco (I believe it was Kitco) a few days ago from a gent who claims the latest Berkshire Hathaway report details that Buffet is actually leasing out the silver. Although I have not verified this, it does make sense if you think about it. He's more than likely getting a rate much better than bonds, and if they default, he settles for cash. All this makes one wonder how much of his position is truly intact.

Would be worth getting our hands on the latest company quarterly or annual report...should be able to dig it up on FreeEdgar...will try to find the time this weekend if someone else doesn't beat me to it!


Lamprey
Black Blade
(03/02/2000; 23:12:51 MDT - Msg ID: 26321)
PGMs for sale?
Source: Bridge newsNY Precious Metals Review: Platinum, palladium slide on Russia New York--Mar 2--NYMEX platinum and Palladium futures ended lower on news that acting president Vladimir Putin had signed 2000 export quotas. Apr platinum settled down $14.70 or 3.2% at $452.5 after a 1-month low of $445 per ounce, while Jun palladium settled down $24, 3.5%, after a 2-week low of $655. Gold and silver also fell throughout the session, ending in the red. (Story .2333)

Black Blade: We shall see.

US DLA offered no platinum for sale Thursday Washington--Mar 2--The US Defense Logistics Agency made no offers to sell platinum or any other metal Thursday via its Web site. (Story .2354)

Black Blade: Obviously, the US DLA aren't convinced either.

Also�.COMEX warehouse added another 2.7 million oz silver today.
THC
(03/03/2000; 01:12:57 MDT - Msg ID: 26322)
Oro re 26313
Oro, brother Oro!!!

I read your post of yesterday in awe........the best I have read in quite some time.......your ability to express the Big Picture is amazing, as always.

I kneel and bow my head in your direction.

Many thanks,

THCView Yesterday's Discussion.

Elwood
(03/03/2000; 01:54:07 MDT - Msg ID: 26323)
Astounding! (not really)
http://nypostonline.com/business/25545.htm
This must be the "season" of rising prices. So typical of our government nowadays. Wouldn't you say?



CPI Report Did Not Include Energy Costs

By John Crudele

http://nypostonline.com/business/25545.htm

DID Washington eliminate the rising price of oil from the last Consumer Price Index?

If you have a car, you know that the price of gasoline has beaten up the family budget in recent months. Homeowners who heat with oil haven't missed that point either. In fact, the fear is that every industry from airlines to the makers of widgets will try to pass on their energy-cost increases to consumers in the months ahead.

Yet Washington is showing very little official inflation. How can that be?

We may have found the answer.

In a tactic that's reminiscent of the old Soviet Union's method of stat-keeping, officials in Washington seem to have simply eliminated the nasty effect of energy prices from their figures.

I say "seems to have" because it is virtually impossible to understand what the ledger-keepers in Washington are doing, even after they've explained it.

But here's what I know.

The Bureau of Labor Statistics reported two weeks ago that the nation's Consumer Price Index rose just 0.2 percent for the month of January. That bit of good information for the markets came shortly after we found out that producer (wholesale) prices were unchanged for the month.

Let's concentrate on the CPI in this column.

Buried deep in a footnote in the CPI report, under a section about seasonal adjustments, is this statement:

"Effective with the calculation of the seasonal factors for 1990, the BLS has used an enhanced seasonal adjustment procedure called Intervention Analysis Seasonal Adjustment for the CPI series .... For the fuel oil and the motor fuels indexes, this procedure was used (in January) to offset the effects that extreme price volatility would otherwise have had on the estimates of seasonal adjusted data for those series."

If this footnote really means what it seems to say, this disclosure is astounding. Washington has been assuring us that that inflation is under control, but it has been reducing -- and maybe even eliminating -- the impact of the rising price of oil in its calculations.

That's like leaving the rain out of a weather report. Or the visitor's runs out of a box score.

If this is what BLS is doing, it would produce a meaningless number.

The financial markets actually pay attention to these CPI reports, even though -- as I've explained before -- the Federal Reserve has come to distrust them and now relies on inflation information gathered from private sources. Last week, in fact, Alan Greenspan publicly said that he'd no longer take the CPI into consideration.

But as far as I know, Greenspan doesn't know about this footnote.

John Williams, an economist who runs the Shadow Bureau of Government Statistics in Hawthorne, N.J., was the one who brought this matter to my attention. Williams did his best to estimate what inflation would have been had the government not used Intervention Analysis.

His guess? Instead of a 0.2 percent jump in the CPI, the number would have jumped a full percentage point for the month. And the producer price index would have been up 2.5 percent instead of zero.

Williams is particularly amazed by the rest of the footnote that states that "extreme values and/or sharp movements which might distort the seasonal pattern are estimated and removed from the data prior to calculation of seasonal factors."

"This is incredible. If only those people using heating oil had their bills handled by the Bureau of Labor Statistics, they'd have no trouble paying them."

It isn't that the statisticians are doing something sneaky. They are, after all, explaining everything right in the report. It's just that nobody knows this statement is there.

What they are doing is wrong and dangerous.

Zenidea
(03/03/2000; 02:49:48 MDT - Msg ID: 26324)
Any intuitions /facts brothers and sisters ?
Gidday mates.
, Perhaps you may be able to help Black Blade ( anyone) ?. I chanced to find Garnet in Aussie
after some seasonal floods in a gully that had been washed . The main Vein as far as i could see is shattered but a clear green through to yellow 95/05 respectively and about six feet high and varies in width to a max of about six inches wide. It is surrounded by soft sort of clayish brown dirt. Around the vein are larger crystals that are dodecahedrons with the largest faceted orbs thereto the sise of golf balls. The closest spot that represents any
seemingly historical evidence of civilisation is a copper mine abandoned eons ago. So the question is : Since copper may contain gold etc . Is the discovery of this garnet of any significance ?. Oh and a jeweler scratch tested it at hardness 8 if that helps ?.
Regards Ray.

Golden Calf
(03/03/2000; 05:28:02 MDT - Msg ID: 26325)
ABX Barrick & many others
Crazy....maybe.....but now's the time to buy
the golds.....oh yeah!
Black Blade
(03/03/2000; 06:38:10 MDT - Msg ID: 26326)
Zenidea and garnets
From your description, it sounds as if you encountered a dike (igneous intrusion) into the country rock. However, garnets occur in a variety of geologic environments, commonly in metamorphic rocks such as schists and gneisses, some in igneous rock such as pegmatite dikes and rarely in granitic rock. Some even occur in ultrabasic rocks such as peridotites and kimberlites. So you see, garnets may not be a very good indicator mineral for prospecting gold. That said, certain types of garnets (such as pyrope) and other minerals (such as diopside for example) have been successfully used to trace galcial moraines in Canada where diamond bearing kimberlites have been found. A geologist named Charles Fripke(?) found diamond bearing kimberlites with that method. The result was the formation of Diamet Mining(?). If anything, depending on the quality of the garnets, you may at least have some semi-precious gemstones :-) Anyway, good luck!
Black Blade
(03/03/2000; 06:50:45 MDT - Msg ID: 26327)
More Pd, and UK to sell more Au
Asia Metals Focus: Japan dealers bullish on Palladium/platinum

Tokyo--Mar 3--Japanese dealers Friday remained relatively bullish on prices of platinum and palladium in the near future, despite expectations of Russia resuming normal exports of the 2 metals soon. The dealers said Russia would resume normal exports of platinum and palladium only if they are able to confirm export shipments. Russia provides about two-thirds of the world's palladium supply and 20% of platinum supply. (Story .2016)

Black Blade: Even the Japanese are skeptical!

BTW, Looks like the UK plans to sell another 150 tons of Au beginning in May! Gotta hurry and sell before the price goes up, eh?
Henri
(03/03/2000; 07:55:46 MDT - Msg ID: 26328)
A Big Thank You!
...goes out to the paper trading gang and those physical dealers who still think that the paper price is a fair valuation of physical transfer to us small little furry toed scavengers.

Buy below $600. I love the gold/oil ratio valuation from the old desert sage trader. Reminded me of the berber market in Marrakesh :-) Gold is a screaming buy under 11...let's see $289/$31 is...GOTTA GO there's a man on the corner in a panic that wants to unload something shiney and yellow. I think I may be able to help.
Solomon Weaver
(03/03/2000; 08:19:38 MDT - Msg ID: 26329)
Russian Oil and Weapons may flow towards China
This is a "typical" newsbrief...I get a similar one or two each day by e-mail...subscription is free....directions at end.

The reason I post this one is that I believe it is relevant to the Another/FOA scenario because as Europe get's financially motivated (Euro introduction) it seems that There are very serious warmings-up going on between Russia and China...related primarily to oil and weapons...but calling for a "multipolar world" where the USA does not call all the shots.

Could be that Putin is pushing this forward "pre National Elections" to generate the feeling he is already really in charge.

--


STRATFOR.COM's Global Intelligence Update - 3 March 2000


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WHAT'S GOING ON IN YOUR WORLD

Faceoff in the Baltics: NATO Expands the West-Russia Confrontation
http://www.stratfor.com/CIS/commentary/0003030232.htm

United States and Malaysia Volley for Asian Influence
http://www.stratfor.com/asia/commentary/0003030123.htm

States in Northern Nigeria Challenge President
http://www.stratfor.com/MEAF/commentary/0003030147.htm

Corruption Scandals May Help Extremist Parties in Europe
http://www.stratfor.com/world/Commentaries/0003030206.htm

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STRATFOR.COM Global Intelligence Update
3 March 2000


In Beijing, The Signs of a New Strategic Partnership

Summary

In China on March 2, the state-run People's Daily ran several
articles touting the benefits of strategic partnership between
Russia and China. The publication appears to endorse little noticed
negotiations between Moscow and Beijing, which are exchanging top-
ranking officials in preparation for a summit. Details have been
closely guarded, but the talks involve oil and weapons. The timing
of the state press coverage suggests that there has now been a
breakthrough in the talks. And it appears that a more vigorous
strategic partnership between Russia and China - one that will
worry the West - is beginning to take shape.

Analysis

Until now, China's official press has remained relatively quiet
about a flurry of diplomatic activity between Beijing and Moscow,
leading up to a long-delayed summit between the two governments
this summer. But on March 2, the state-run People's Daily ran a
series of articles touting the benefits of strategic partnership
between Russia and China. The articles also called for a multi-
polar world, instead of one in which the United States is the
dominant power - calling for the "establishment of a just and
reasonable new world order." The timing does not appear to be
coincidental.

Right now, one high-level meeting between Russian and Chinese
officials is concluding in Moscow and another is beginning in
Beijing. They are part of a string of talks - eight exchanges in
recent weeks - in preparation for a summit between Chinese and
Russian leaders. The People's Daily articles appear to signal a
possible breakthrough, both in the talks and the leadership
strategies of both nations. It now seems that a more vigorous
strategic partnership is forming between Russia and China. Alone
each is too weak to challenge American power, but together the two
nations can coordinate strategy and ultimately create simultaneous
problems for the West on disparate parts of the globe.

China and Russia have claimed to be strategic partners since 1992.
But in reality, the two nations have made little real progress
other than to ineffectively challenge U.S. policy in the Persian
Gulf and the Balkans. The two governments have most recently been
preparing for a summit between acting President Vladimir Putin of
Russia and President Jiang Zemin of China. The summit has been
discussed, reported and tentatively scheduled. The repeated
postponement suggests that the summit is serious, a matter of
considerable advance negotiation, and not merely a photo
opportunity.

Most of the hesitation has come from Beijing, as Chinese officials
petitioned for international recognition and strength based on
economic growth, attempting to join the World Trade Organization
(WTO). With its economy in much worse condition, Russia appeared
less an asset to Beijing than a liability. Throughout the talks,
Beijing appears to have kept Moscow at a distance both to keep the
door open to the United States and to remain dominant in
negotiations with the Russians.
http://www.stratfor.com/services/giu/121099.asp

Quite suddenly, China has turned public attention toward its
relationship with Russia. Aside from mentioning future bilateral
visits, the articles emphasized the idea of fostering "global
strategic stability and regional security" through Chinese and
Russian cooperation. Clearly looking back at U.S. military action
in both the Persian Gulf and Kosovo in the last 14 months, the
articles also call for respect for territorial integrity of
sovereign states and opposition to "humanitarian intervention."
China and Russia are clearly considering this recent history as
they regard Taiwan and Chechnya.

This endorsement of the relationship appears timed to coincide with
intense, high-level diplomatic activity and suggests that some sort
of breakthrough has been achieved in the talks. In recent weeks,
Beijing and Moscow have had no fewer than eight exchanges of
officials to prepare for the summit, now tentatively set for June.
While the People's Daily was publishing its articles, Chinese
Foreign Minister Tang Jiaxuan was concluding his visit to Moscow
and Russian Deputy Prime Minister Ilya Klebanov arrived in Beijing
on March 1.

In addition, the two nations are studying a deal that furthers
their common goals by advancing their individual interests. A deal
may involve both Russian oil and advanced weapons systems bound for
China. A main topic of Klebanov's visit to Beijing is Russian arms
sales and energy for China. On the table is a renewed proposal for
an oil pipeline from the Russian Far East through Mongolia and into
China, nuclear fuel for a Chinese reactor and continued sales and
cooperation on advanced weapons systems. In turn, Russia would
receive some hard currency and the benefits of increased economic
activity within its energy and arms industries.

This evolving relationship suggests a series of important
developments. In China, it appears that the center of gravity
within leadership circles is shifting. Until now, China held Russia
at arm's length and elements for economic reform had the ear of
Jiang. But Jiang's ambitions and the deteriorating domestic
situation have fostered a resurgence of the old-guard - those who
want a strong China without needing to appeal to the United States
or the western world. On a global scale, both Russia and China are
increasingly squeezed by international pressure in areas they
consider to be within their respective spheres of influence - and
this is driving them closer together.

The strategic partnership now taking shape is not a formal military
alliance with either hostile intent or desire for global conquest.
Rather, it is based on a simple, common fact. Individually, China
and Russia are weak - economically, politically, and militarily -
in comparison to the United States and its allies in Europe and
Asia.

Together, however, they can present a formidable counter to the
United States and its allies. Today, China is unable to project
military power far beyond coastal waters - but increased energy and
military supplies will help mitigate this over the coming decade.
This plays into China's increasingly short timetable for the return
of Taiwan repatriation; in the space of only years China will be
able not only to threaten the island but U.S. forces if they
intervene. In return, by boosting the Russian defense industry,
Russia gains much-needed cash and a way to revitalize at least a
portion of its domestic economy.

Even in the very short term, China and Russia can - if they choose
- present the West with a very difficult proposition: simultaneous
crises in Taiwan and on the Russian periphery. In such an extreme
situation, the West would be hard-pressed to respond. The U.S.
military is now stretched thin by increasing global commitments and
static post-Cold War force levels. Over the next decade both Russia
and China will only attempt to expand their military capabilities.




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Solomon Weaver
(03/03/2000; 08:24:26 MDT - Msg ID: 26330)
(No Subject)
Galearis (03/02/00; 20:55:27MDT - Msg ID:26318)
@ Solomon Weaver
Yes I do realize that the POG is a paper driven derivative creation, but the point of my discussion really is that physical gold, at least in smaller weights can be purchased at these prices. The depressed price is an indirect benefit of the shorting pressure that benefits the small gold bug investor. I don't know where you got the idea that I had a million dollars to invest in physical (unless you have psychic abilities and were wiffing a constant daydream of mine).
---
Galearis...I was sort of a joke that you were going to drop an million into gold....yes we all have dreams.

The point was also that even to make a dent in physical trading you have to have such monies..and those who do usually prefer the "ease of paper".

I agree wholeheartedly with your commments of POG in an inflating fiat.....this is already occuring in Australia as their dollar weakens....also this has caused their shorts to more aggressively defend.

Poor old Solomon
USAGOLD
(03/03/2000; 08:36:06 MDT - Msg ID: 26331)
Today's Gold Report: Government Inflation Cover-Up
http://www.usagold.com/Order_Form.html3/3/00 Indications
�Current
�Change
Gold
288.40
+.20
Silver
5.04
+.03
Gold Lease Rate
0.4362%
nc
Gold Comex Stocks
1,373,896
nc


Market Report (3/3/00): Those of you who read this report regularly
know that we don't buy the government statistics on inflation. More than
once, we have remarked that Alan Greenspan was not reacting to the
Inflation Phantom as some in the financial press have suggested, but to
the Real Thing -- that in fact he might be looking at another,
for-his-eyes-only set of statistical criteria on the economy not
available to the rest of us. If you happen to do the family grocery
shopping, or gone out to shop for an automobile in recent months, or
stopped at the gas station over the past few days, there might be some
question in your mind why the government keeps telling us that inflation
is gone forever in this Cinderella economy and the shrinking value of
the dollar is a figment of our collective imaginations.

Well, John Crudele of the New York Post, has done yeoman work in
uncovering the reality of the inflation that now grips the U.S. economy
and what he has uncovered is astonishing. It's not so much the
government has been lying to us that's so troubling (nothing new on that
score), its the incredible depth of the lie. Says Crudele in a column
published yesterday (Thanks, Elwood at the Forum. See Msg# 26323 for
details.) Crudele says that the situation at the Labor Department (which
has been given the responsibility of reporting on inflation) is
"reminiscent of the old Soviet Union's method of stat- keeping."

It seems that the Labor Department has found a way to get around
including the explosive and "nasty" effect of energy prices in the
Consumer Price Index. I'll let Crudele explain it in his words:

The Bureau of Labor Statistics reported two weeks ago that the nation's
Consumer Price Index rose just 0.2 percent for the month of January.
That bit of good information for the markets came shortly after we
found out that producer (wholesale) prices were unchanged for the
month.

Let's concentrate on the CPI in this column. Buried deep in a footnote
in the CPI report, under a section about seasonal adjustments, is this
statement:

"Effective with the calculation of the seasonal factors for 1990, the
BLS has used an enhanced seasonal adjustment procedure called
Intervention Analysis Seasonal Adjustment for the CPI series .... For
the fuel oil and the motor fuels indexes, this procedure was used (in
January) to offset the effects that extreme price volatility would
otherwise have had on the estimates of seasonal adjusted data for those
series."

If this footnote really means what it seems to say, this disclosure is
astounding. Washington has been assuring us that that inflation is
under control, but it has been reducing -- and maybe even eliminating
-- the impact of the rising price of oil in its calculations. End
Quote.

I would agree that this revelation is "astounding" leading one to
question why it is so important to the government to cover-up the level
of inflation in the United States. So much so that the chairman of the
Fed in Congressional testimony is forced to manufacture an imaginary
circumstance, i.e. fighting the "threat" of inflation, in order to gain
the political leverage (and excuse) for raising interest rates -- the
time tested approach to killing an inflation. Does it have to do with
the government Cost of Living Adjustments on Social Security, etc? Or
does it have to do with the fact that there's an inflation raging in the
country and those in power don't want the money creation that's fueling
traced back to them? Or does it have to do with the absolutely worst
circumstance one can think of -- "The inflation can't be stopped so
let's make it look like it's not there."

I defer once again to Mr. Crudele's take on the matter:

John Williams, an economist who runs the Shadow Bureau of Government
Statistics in Hawthorne, N.J., was the one who brought this matter to
my attention. Williams did his best to estimate what inflation would
have been had the government not used Intervention Analysis.

His guess? Instead of a 0.2 percent jump in the CPI, the number would
have jumped a full percentage point for the month. And the producer
price index would have been up 2.5 percent instead of zero.

Williams is particularly amazed by the rest of the footnote that states
that "extreme values and/or sharp movements which might distort the
seasonal pattern are estimated and removed from the data prior to
calculation of seasonal factors."

"This is incredible. If only those people using heating oil had their
bills handled by the Bureau of Labor Statistics, they'd have no trouble
paying them."

It isn't that the statisticians are doing something sneaky. They are,
after all, explaining everything right in the report. It's just that
nobody knows this statement is there.

What they are doing is wrong and dangerous.

The government has provided one of the best reasons, I can think of to
own gold: If the inflation picture is so bad, they are afraid to report
it, then citizens need to move toward protecting themselves against it
-- and not deliberately, quietly and judiciously, but in short order.
When the truth surfaces and the public at large discovers it, the run to
gold will begin in earnest and you won't want to be caught in the
stampede.

That's it for today, my fellow goldmeisters. See you back here Monday.
Have a nice weekend.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click on above link and make the appropriate entries.
ORO
(03/03/2000; 09:20:23 MDT - Msg ID: 26332)
USAGOLD - Keyworf for BLS

The Keyword is COLA

COLA to government salaries and to Social Security payments would increase government expenditures and eliminate the budget surplus in a jiffy. That was, in part, how the 70s worked, despite attempts to lower the headcount of government, the crowning achievement of the Ford and Carter administrations and, of course the Reagan team, the expenditures continued growing through the COLA adjustments. The "old folks" who fought WWII were not about to be cheated in their COLAs, so the data could not be massaged because of political considerations. The golden years lobby is now very weak, and they are standing silent as the terms of the Social Security contract are changed against them.
goldfan
(03/03/2000; 09:45:29 MDT - Msg ID: 26333)
RossL (03/02/00; 18:15:54MDT - Msg ID:26312)

Paper PM Markets

Poor Old Solomon, Jason, Beesting, Henri
Sir RossL You said:
>>>>>>It seems to me that the paper palladium market is detaching itself from the physical market. If it is doing so, then I theorize that we can watch the current palladium events as a roadmap for what is to come when the paper silver and paper gold markets come apart at the seams. Limit up days, followed by changing the rules in favor of the shorts, followed by declining paper prices with no physical available. What's next?

Also, notice that Stillwater (SWC) stock peaked with the paper market in palladium. Gold and silver stocks may not be a fun place to be when the paper gold and paper silver markets start to fail.<<<<

My guess is that when the price of paper PM's starts to drop, detached from the physical, it'll drop down fast, and if it affects the stock prices of producers they'll rapidly act in concert to put out the true prices they are getting for their production. maybe even set up their own marketing via Internet as Beesting suggests...No??

Goldfan




Journeyman
(03/03/2000; 11:10:39 MDT - Msg ID: 26334)
Re: Government Inflation Cover-Up @ TC, ORO, ALL

The MAIN reason the government (and the FED) SHOULD want to cover up "inflation" is that once the "inflation" becomes commonly recognized, it will become a self-reinforcing process as more and more of the people holding "BIG FLOAT" rush to unload it faster and faster to minimize their expected loses as dollar trade value plummets.

Regards,
Journeyman
CoBra(too)
(03/03/2000; 11:24:10 MDT - Msg ID: 26335)
"Money No Longer Matters!???" a Qoute from Ned Davis Research
"Throwing away over 100 years of money supply statistics, carefully researched by people like the reknowned Milton Friedman, going all the way back to 1867, the FED recently told Congress in its Humphprey Hawkins report that it has "little confidence that money growth within any particular range selected for the year would be associated with the economic performance it expects or desires". And, according to a Dow Jones News report, Fed Governor Edward Gramlich recently said "some years ago many believed that stabilizing the growth of money supply would lead to stable prices, but this approach is now generally discredited".
In other words, money no longer matters!
ND goes on stating that money stillmatters very much. The only problem is that excess credit reation does not always show up at in everey cycle in the same places. For the past five years, credit and money creation has been far above Fed targets and when they throw out things like oil prices or the boom in luxury homes prices, they can't find "Core Inflation" anywhere.
In the 1970s, inflaion was found in hard assests, but over the last 5 y's -as well as in the 1920s, and the 1980s in Japan, there was little or no CPI-inflation, and the excess credit creation found its way into the stock market, creating speculative booms. In all these three low inflationary periods, the central banks felt the reckless money supply growth was not fuelling "core inflation", so they were very comfortable with excess credit creation. But in the prior two cases, things ended badly when CB's raised the discount to 6%, thus taking away the punch bowl."
My take: This kind of complacency is making me more than edgy and no amount of market interventions will stave off the ultimate results. And if a one month slowing employment data can add 2% on DJII in an hour one has to wonder about the potential downside if and when reality sets in as the consumer wakes up and feels the pinch in his pocketboook! No amount of wealt effect, which may be on a decline anyway looking at the poor leadership in the stock market.
Go for cover - go for gold - CB2


Solomon Weaver
(03/03/2000; 12:36:57 MDT - Msg ID: 26336)
goldfan
My guess is that when the price of paper PM's starts to drop, detached from the physical, it'll drop down fast, and if it affects the stock prices of producers they'll rapidly act in concert to put out the true prices they are getting for their production. maybe even set up their own marketing via Internet as Beesting suggests...No??

Goldfan
---------
Goldfan

Hi highly agree with you.....meaning that since mining companies sell physical material..they will have a very intimate understanding of what the product is really worth...


On the other hand, if the paper markets are in trouble it could cause a lot of large investment houses to keep free old both gold and gold stocks....this could prove particulary troublesome to jr. miners who don't have large cash flows.
Galearis
(03/03/2000; 12:46:43 MDT - Msg ID: 26337)
@Zenidea and Black Blade about garnets
I've seen a few exposures similar to what you describe in Ontario, Canada and they certainly have a mineralogical interest. And it certainly sounds like a dyke that you describe, but could also be a skarn zone. Are the garnets of a dark red in colour or lighter - grading into orange, for example. Garnet rich zones can also be the product of very local contact metamorphism (skarns) and the local mineralization may be even more interesting. Other goodies possible are rare earth minerals, zircons etc. It also sounds like the country rock is altered granitic (feldspar rich) material - that has chemically broken down into component clays. I presume the site is in the Australian warm belt as this phenominon is common in Brazil etc.

But the bottom line, as interesting for the mineralologist as this might be, it is probably not of particular interest as an indicator of metal mineralization. In Ontario (and elsewhere) garnet is a common mineral - often, as Black Blade infers - present in quantity (if not quality) in a variety of igneous and (especially) metamorphic rock types.

But the size of the crystals - and if they are sharp and shiney - would have considerable interest to the collector.
If they are quite dark in colour, they are likely almandite garnet, an iron-rick species - and the most common of the garnets. You do not mention clarity, so I presume this leaves out hope for gem material.

Hope this is helpful to you.
SteveH
(03/03/2000; 12:47:46 MDT - Msg ID: 26338)
Sorry if this has already been...
http://www.cnnfn.com/2000/03/02/investing/q_goldstandard/posted. The above link shows gold is getting interest and the hedge market is messing up the stock prices.
Galearis
(03/03/2000; 12:58:03 MDT - Msg ID: 26339)
@ Solomon Weaver......a million into gold
I would not hesitate for a nano second to drop a million into gold. My immediate problem is getting the million to drop. I have heard that this problem is a common one, so I feel better in having the company in misery.

I notice too that even on Friday silver is showing a little frisk. I have a little put away to put into the white, however. I just hope it doesn't explode on Monday - that would ruin my day. (I presume you noticed the Ag lease rates plummeting exhuberently today).This month or April is my (hopeful) prediction for silver to be on its way for the COMEX version of the TOCOM.

We will see a little paper exchanged then too.
Solomon Weaver
(03/03/2000; 13:14:36 MDT - Msg ID: 26340)
Warren Buffet - What is he planning with silver?
lamprey_65 (03/02/00; 22:29:35MDT - Msg ID:26320)
Solomon In reference to Buffet's silver position, found a post on Kitco (I believe it was Kitco) a few days ago from a gent who claims the latest Berkshire Hathaway report details that Buffet is actually leasing out the silver. Although I have not verified this, it does make sense if you think about it. He's more than likely getting a rate much better than bonds, and if they default, he settles for cash. All this makes one wonder how much of his position is truly intact. Would be worth getting our hands on the latest company quarterly or annual report...should be able to dig it up on FreeEdgar...will try to find the time this weekend if someone else doesn't beat me to it! Lamprey
--
Understand what Mr. Buffet is doing is going to be a key to anticipating what the "flavor" of the silver crisis is going to look like....in the end however, the situation is such that we are running a deficit of about 200 million ounces per year and it appears that what is left in COMEX and LBMA vaults is about all the "commited silver" there is...meaning in order for more real physical sellers to line up the price will have to rise.

Parties who "leased" silver into the market were duped...since most likely they will get little or no silver back for quite a while....just cash. The remaining silver holders who do not see that it is in their interests to stay out of the market until significant price rises are not understanding the silver phyical situation.

Here is how I view the issue of Mr. Buffet leasing or not leasing.

1. Leasing implies physical transfer of metal to a party who will "sell" it in the market for cash. If Mr. Buffet were to "lease material" but keep in in his vault, he could do better to simply loan someone money....he has enough credit to be a bank if he wants....I just do not see Mr. Buffet having any real interest in what he gains by leasing vs. the risk of default. Perhaps he is "leasing enough" be able to "state publically" that he is...but he's a buy and hold guy and you know he sleeps best sitting on as much of the metal as he can for now, knowing that in due time his day will come.

2. When Mr. Buffet bought all that Silver it caused a short squeeze where the COMEX changed some of the rules to prevent large financial interests from being able to take such large physical deliveries. Mr. Buffet was literally forced into continuing some leasing in order not to appear as a bandit. And what he did is now impossible to repeat.

3. Mr. Buffet is a value hunter. The fundamentals of the silver market are stacked against the status quo...they have literally robbed the coffers and the only way to get supply/demand balance is for silver to go to $10 $15 $20 for at least five if not 10 years. (and in the meantime we could have 6-24 months of a story like the Hunt days and today's palladium).

4. Mr. Buffet knows that there are large financial interests who will be forced to settle in cash instead of silver. HE DOESN'T WANT TO BE ONE OF THEM UNLESS HE CAN DICTATE ALL THE TERMS. And if he has leased all his material, he has no better bargaining position than the other parties who are "OWED" hundreds of millions of ounces of silver.

5. Mr. Buffet has most of his net worth in Stocks and he is prudent enough to act in silver such that he is not blamed for stock market problems...he is also in the position to sell silver selectively to industrial companies where he is a shareholder...perhaps in exchange for large blocks of newly issued stock. Because he will sell it the way he wants, for all intents and purposes his material is "not really available to the markets, ever."

Poor old Solomon
TownCrier
(03/03/2000; 14:55:17 MDT - Msg ID: 26341)
Aggregate Money Supply Increases for the U.S.
http://biz.yahoo.com/rf/000302/9n.htmlIn the week of February 21st, according to figures released by the Fed:

M-1 rose $3.8 billion to $1,105.6 bllion
M-2 rose $4.7 billion to $4,691.8 billion
M-3 rose $14.6 billion to $6,546.7 billion (represents an 11.5% annual growth rate on the week.)
TownCrier
(03/03/2000; 15:24:42 MDT - Msg ID: 26342)
Food for thought for Sir Solomon
In regard to what you suggested in your item #5 that Mr. Buffet "is also in the position to sell silver selectively to industrial companies where he is a shareholder... Because he will sell it the way he wants, for all intents and purposes his material is 'not really available to the markets, ever.'"

Would it not be the case that an idustrial user, having their silver needs satisfied in such a manner, would not subseqeuntly bring their own demand pressure to bear on the marketplace? The result is a wash whether he sells it over the counter or in the back alley. Real demand for a physical good should not be clouded by the perceptions based on price movements, which--if anything like gold--are determined through unrelated contracts markets where supply and demand can be something entirely separate. Feel free to dismiss this as you wish, for silver is alien to me and I am surely speaking from a position of weakness here.
dragonfly
(03/03/2000; 15:50:39 MDT - Msg ID: 26343)
Aristotle, Journeyman, Peter, All
Aristotle, I hope you have time for a few more comments and questions. As a prelude I think it is only fair to state the basis of my questions so that you can more readily hone in on where my actual misunderstandings or deficiencies may lie as opposed to assuming a philosophical perspective that is not one I share. This saves time and enables us to get to the heart of the matter in a simpler way. Thanks in advance for your patience with my approach and thought process.

First I must express my reaction to your statement <<<" Interesting perspective you've offered. I ask this: What magical well of real-wealth creation are we currently drawing from if our future needs don't have to be fairly created and saved by our extra production today. Meaning, how is it that we can continue to expect something for nothing�dollar accounts that grow faster than we do, and miraculously continue to buy more, even accounting for inflation? We've been able to do this in America on the backs of the rest of the world playing along. Why should they continue?">>>

OUCH. I fail to see where the question elicited or warranted that response, but since I am somewhat new here let me give a little more information and hopefully select the correct words because I agree with Peter about exact meanings wherever possible. Some of us out here have never played the stock market game, refuse to participate in the something-for-nothing 401-K pre-tax investment scam, have no debt and paid mostly cash on the barrel for most of our possessions. A few of us even reject the "flex plan" benefit of paying for medical expenses with pre-tax dollars. We have no entitlements, no paid-up retirement plans from our companies or unions, and seek no handouts in any fashion. I understand quite well the notion of facing the future as a free man, unencumbered by the tentacles of modern socialism, and actually hope to be fortunate enough to work productively, creating needed goods until I die of old age. OUCH. I am very much in solidarity with those whose backs and indeed graves have formed the playing field of this nation's ambitions. The pride I have in remaining as defiant as I can be in the face of this imbecilic juggernaut does not blind me to the necessity of a proper saving and/or investment plan. That is why I asked the question in the first place. The part of my original question that was left out in your response should have clarified the context and provided additional meaning to the words previously written. I also said <"It seems to me that the only way for it to work, especially if the whole world was playing the same game, would be for the value of gold to increase as demand increased and in that sense one would get more than one gave. But this wouldn't work for very long would it? One would be able to purchase more labor and goods relative to what the gold cost when one traded labor for it. Doesn't that put someone into a tough situation if productivity and wage increases don't match gold value increases? How could most people ever save enough gold to plan for their elder years?">

You see, I am questioning how that someone, most likely a person who is already suffering dollar system effects to a degree most among us would not like to consider for ourselves, is ever going to catch up. As the paper 'burns� there are many palms to consider and a lot of them are not yuppie dot-commies, for whom I suppose most of us posting here won't feel too sorry. Alot of those palms are attached to the poor folks you refer to in your response. Sure, a "perfect monetary system" would alleviate future injustices to a great degree, but what about the transition period and the plateau thereafter? If the wealthy and wise of the world bid up the price of gold, out of fear and righteousness, will the downtrodden be better off simply because there is a free market in gold in which they can now participate? I don't know.


Now, it would be misleading to propose that most of us who hold physical gold dear do not look forward to its securing a bit of our personal future, but would it be heresy to question the consequences of "windfall profits"? Is the prerequisite "wisdom" in any substantial way different than other less noble 'something-for-nothing� inclinations? While many would denigrate the lumpen welfare slob for accepting government largesse, others might point out that they are in all actuality getting almost 'nothing-for-something�, that 'something� being their obedience and votes and that almost 'nothing� being paper dollars and disposable possessions. On the other hand, those of us who have come upon our knowledge of fiat currencies and true wealth at such an auspicious time in history, are really trading almost 'nothing-for-something�. I don't suggest that we feel guilty. Not at all. But shouldn't we recognize that our individual successes in this realm may be intimately related to major negative effects for others, both here and abroad, who have no idea of what's going on and even less responsibility it. Thus far I haven't read much that addresses this part of the equation, or didn't recognize it in another form

Well I'll leave it there for now. I guess its not the 'perfect monetary system� I am as concerned with as the 'imperfect world� in which it will operate. If those who own the gold make the right rules then everything ought to be pretty good. But what evidence do we have that that has ever been the case in human history?
(Boy I'll bet that one is going to send me back to my stack of homework, (smile)).

To be continued as my study of your series progresses. Thanks again for a stimulating dialog. Hope I'm not too na�ve for this discussion.


Peter Asher
(03/03/2000; 15:58:11 MDT - Msg ID: 26344)
"if he had a brain, he'd be dangerous."

RonWortham@aol.com wrote:

> If we don't succeed, we run the risk of failure." --Al Gore
>
> "Democrats understand the importance of bondage between a mother and child." -Vice President Al Gore
>
> "Welcome to President Clinton, Mrs. Clinton, and my fellow astronauts."--Vice President Al Gore
>
> "Mars is essentially in the same orbit... Mars is somewhat the same distance from the Sun, which is very important. We have seen pictures where there are canals, we believe, & water. If there is water, that means there is oxygen. If oxygen, that means we can breathe."
> --Vice President Al Gore, 8/11/94
>
> "The Holocaust was an obscene period in our nation's history. I mean in this century's history. But we all lived in this century. I didn't live in this century."
> -- Vice President Al Gore, 9/15/95
>
> "I believe we are on an irreversible trend toward more freedom and democracy - but that could change."
> --Vice President Al Gore, 5/22/98
>
> "One word sums up probably the responsibility of any vice president, & that one word is 'to be prepared'."
> --Vice President Al Gore, 12/6/93
>
> "Verbosity leads to unclear, inarticulate things." --Vice President Al Gore, 11/30/96
>
> "I have made good judgments in the past. I have made good judgments in the future." --Vice President Al Gore
>
> "The future will be better tomorrow." Vice President Al Gore
>
> "We're going to have the best-educated American people in the world."
> --Vice President Al Gore, 9/21/97
>
> "People that are really very weird can get into sensitive positions and have a tremendous impact on history."-- Vice President Al Gore
>
> "I stand by all the misstatements that I've made." --Vice President Al Gore to Sam Donaldson, 8/17/93
>
> "We have a firm commitment to NATO, we are a part of NATO. We have a firm commitment to Europe. We are a part of Europe."-- Vice President Al Gore
>
> "Public speaking is very easy." -Vice President Al Gore to reporters in 10/95
>
> "I am not part of the problem. I am a Democrat." --Vice President Al Gore
>
> "A low voter turnout is an indication of fewer people going to the polls."
> -- Vice President Al Gore
>
> "When I have been asked who caused the riots and the killing in L.A., my answer has been direct & simple: Who is to blame for the riots. The rioters are to blame. Who is to blame for the killings? The killers are to blame.
> --Al Gore
>
> "Illegitimacy is something we should talk about in terms of not having it."
> --Vice President Al Gore, 5/20/96
>
> "We are ready for any unforeseen event that may or may not occur."
-- Vice President Al Gore, 9/22/97
>
> "For NASA, space is still a high priority." --Vice President Al Gore, 9/5/93
>
> "Quite frankly, teachers are the only profession that teach our children." --Vice President Al Gore, 9/18/95
>
> "The American people would not want to know of any misquotes that Al Gore may or may not make." -Vice President Al Gore
>
> "We're all capable of mistakes, but I do not care to enlighten you on the mistakes we may or may not have made." --Vice President Al Gore
>
> "It isn't pollution that's harming the environment. It's the impurities in our air and water that are doing it." -- Vice President Al Gore
>
> "[It's] time for the human race to enter the solar system." -- Vice President Al Gore
>
> AND, OF COURSE, (TO ALL USERS OF THE INTERNET),
> THE ALL TIME FAVORITE QUOTATION OF MR. AL GORE:
>
> "As many of you know, I was very instrumental in the founding of the Internet"
> --AL Gore to Katie Couric 3/99


ORO
(03/03/2000; 17:29:47 MDT - Msg ID: 26345)
Do you have a collection of Bush Jr quotes?
I think he has the same foot in mouth disease his father has.

Are these two the only things this great nation can raise as credible presidential candidates?

Who will save us?
4Ducat
(03/03/2000; 17:44:06 MDT - Msg ID: 26346)
First it's a spike then it's a flag.
http://www.usagold.comI think another spike up in the XAU would provide some boost to the POG, I hope it will. A few goldsticks are one or two days away from bouncing off their two-year lows as they were before the last spike. I don't even have to read the paper but to look at these levels. These are not going to stay at this beaten down situation for more than a week. I think these jimmies are going to bounce up soon. Maybe not the super spike like we hope for but like the bored surfers in August said, "Any wave now is a good wave". Seems the DOW is doing its infamous "suckers rally". Yes that is exactly what it is and if you are not unloading your, I mean "taking out the trash". Think about the children!!! Blue chips are what sailors play poker with. The big boys are using this rally to go short with all they've got. Pump and dump. Market meltdown is on its way. How do we know it's market meltdown...........What rallies last? Biotech. First was tech, then internut, then in the past month while the first two have been drifting down the last kid gets his shoes tied to run the race. Little boy biotech. OK he ran real nice. He made the team. But the season is OVER. No it isn't completely over. Small Cap was going "parabolic to the upside" but when a few hundred $3 stocks go to $9 within a month and a half. You are going to tell me you are a "value investor". Aye mate tis all subject toa fast break down. Show is almost over, better pawn your movie tickets quick. These laggard sectors are the last horses out the gate, Biotech and Small cap. The big money is flowing into bonds and short positions. A falling dollar will pull money out of bonds and into gold. Equities are no safe haven for capital.

I'm bullish on gold because it's the only intelligent choice left. BECAUSE WHEN MARKET MELTDOWN HITS (quick slide down or the sudden panic sell) THE VALUE OF THE DOLLAR WILL FALL WITH IT. Perception becomes reality when we are dealing with mania and panic. No logic. No rational thought. No sentance structure either. Chinese are proactive politically. They attacked across the Yalu in Korea long before we got near it. Watch gold sales in Asia for clues to their attitudes towards holding dollars.
What can foreignors buy if not "sticks and binds". Foreign governments will hold dollars when they are a safe haven of value. The EURO's weakness also helps gold because any successful fiat currency is a lying competitor to gold. So they will not go to the Euro as it slides in value until the ECBs prop it up again. Asia and Europe want their hemispheres economically separated from the dollar. Asia wants to form an Asian-Alliance trade zone because they feel they are weak against a US American continent trade zone. Europe has its union trade zone. As the European union gets stronger the rich squabbling families that control Asian industry will be forced to come together. The main reason for their union will be for inter-asian trade. Less reliance upon US markets, that way the US will go along with their union ideas. Can't upset older brother.

STAGE ONE......get a common currency. Introduce it by selling bonds denominated in it. Once it's accepted then STAGE TWO........let the currency rise in value to compete with the dollar. The EURO is about to enter stage two once the ECB's feel it is accepted enough.

They can slowly deregulate their industries giving it more value as the currency would buy more when eurozone prices fall. They want the economic benefits of the USA without the social insanity caused by freedom without discipline.

If a straight talker like McCain gets elected we might gain some respect. But he is a fine loose cannon of a Scot and a bit too much for the shallow minded electorate. He'll get the Perot vote but McCain isn't quite Philly parade material like DC wants. So we might end up with a pandering guy from the twilight zone. Land-Grab Al. I thought I saw Bradley running the painting demo class at Lowes. Bush is starring in a new film "Platitudes II". It's a story about an insurance salesman who found out after joining a country club that he could retire early if he made enough rich friends.

...........................................................
Did anybody see the documentary on all the teen prisons in California? So the solution is always to build more prisons. Ladies and gentleman, it's called tyranny. "We think your teenager is an eyesore to the community and the illegal drugs they used aren't powerful sedatives like the ones we are going to put them on". With almost a case worker ratio of one to one it's only a question of money as to how to "create more social worker jobs". Hard labor is the solution. Not institutionalized isolation cells. Must be a hard life as a caseworker, only so many varieties of creamers to put in a day's coffee. Bring back the CCC. Civilian Conservation Corps. Eight months worth of planting trees in Alaska and we're on the road to redemption. Tough love not high taxes. Leave me with some money for gold, please.

Anything I write is open for criticism or comment. I'm mostly interested in perceiving of the macroeconomic trends developing because I feel the details will be confirmations or negations of forthcoming trends. All these things I write about should be held loosely if at all. A 20 minute speech by Greenspan can send us all back to the drawing board. That's what makes it fun. Have a great gold weekend.

I might sound like I want the dollar to collapse. Not so. I want to see gold at its real price in a free market situation. I live in the US yet I am taxed at the rate of Europeans and I receive no benefits from the government at all. I'm tired of seeing innocent people hurt by market manipulations, government and corporate propoganda (news), and the general attitude of all the cowardly scared people who are affraid to say what is right. Maybe you lurk so much because you have not the ability to speak the plain truth. I like McCain but I also know he is not electable. But I'll still vote for any independent. I believe in sound money gold, but I also accept that it is manipulated down. So I use their shorting to my advantage. I buy in after they beat it down. The last thing we need is a price rise to $600 and we are stuck with our uninvested paper. Your dollars only have value with a low POG.
Harley Davidson
(03/03/2000; 17:47:41 MDT - Msg ID: 26347)
ORO your Msg ID:26345
Alan Keyes!!!
Peter Asher
(03/03/2000; 18:19:12 MDT - Msg ID: 26348)
dragonfly (3/3/2000; 15:50:39MDT - Msg ID:26343)
Aristotle, Journeyman,
SAVINGS' was the word that I felt Ari exactly defined.

So, within that context of savings being "Unspent earnings, created by real wealth actually produced " How is it possible have that credit to spend at some time in the future?

Gold, outside of those times that it is artificially depressed in purchasing power by manipulation, is going to keep your unspent value alive and well. -- BUT, when and how often are we going to be "Outside of those times"?? A perfect monetary system in an imperfect world may be mutually exclusive.

The alternatives: "Paper storage" in banks or bonds? Bad idea! We all concur on that. Erosion most probably and obliteration always a possibility.

Owning stock in real companies that produce real goods? Once upon a time that was a way to get dividend yield in return for capitalizing, or reimbursing the capitalizer, of a production facility.
Now though, the price multiples are discounted far into an uncertain future. The premium is too high and also technology evolves so rapidly that it is unknowable as to what endeavor will be replaced by new innovation and not be there for you when you need it. (Buggy whip company then Check printing outfit, soon),

So how else to stash that value that you truly created but wish to exchange later?

As Will Rogers said "Buy land, they're not making any more of it." Even there, land that Man develops has tenuous value subject to wise or destructive use and the manipulations of politics and finance.

However, farm and forest property does not ever become obsolete. If you keep yours clean and productive, it's value will never fall. And, it will rise in value to the degree that others trash or convert theirs, and also be more valuable as the population increases. Taxes can be paid by the product generated, and while it is not portable as PM's are, it is impossible to steal, as one has recorded title.

Hard assets stored real wealth long before Man found ways to get something for nothing by legal, though unethical trading, having no true value in its activity. Hard assets will continue to store value long after a future society that has learned that speculative profiteering is as counter-survival to the common good as rape, pillage and burn. All profiteering dilutes the amount of goods and services that are available to be exchanged for the labor of the true producers.

To paraphrase John Donne:

Ask not from whom that profit comes. It comes from thee.



No man is an island, entire of itself;
every man is a piece of the continent,
a part of the main.

If a clod be washed away by the sea,
Europe is the less, as well as if a
promontory were, as well as if a manor
of thy friend's or of thine own were:

any man's death diminishes me,
because I am involved in mankind,

and therefore

never send to know
for whom the bell tolls;
it tolls for thee.

John Donne (1572-1631)







Dollar Bill
(03/03/2000; 19:46:11 MDT - Msg ID: 26349)
very wrong
Peter Asher,
The qoutes you attribute to Gore are virtually all
from Dan Quail.
The one from the internet was Gore's but even that one
might be not 100% accurate wording.
Tell your source to stop the fraud.
I dont blame you.
Solomon Weaver
(03/03/2000; 20:00:58 MDT - Msg ID: 26350)
TownCrier - thanks for thinking of silver
TownCrier (3/3/2000; 15:24:42MDT - Msg ID:26342)
Food for thought for Sir Solomon
Would it not be the case that an idustrial user, having their silver needs satisfied in such a manner, would not subseqeuntly bring their own demand pressure to bear on the marketplace? The result is a wash whether he sells it over the counter or in the back alley. Real demand for a physical good should not be clouded by the perceptions based on price movements, which--if anything like gold--are determined through unrelated contracts markets where supply and demand can be something entirely separate. Feel free to dismiss this as you wish, for silver is alien to me and I am surely speaking from a position of weakness here.---

Sir TC Perhaps you are alien to silver but you a brilliant goldmind so you are much more akin than you think.

I sometimes feel a little bad on a gold forum talking about silver but I think that they are 1. very similar beasts 2. both great investments. 3. Likely to perform in price together in general but in periods not (compare Pt Pd to Au lately).

I will agree with you completely that no matter how much silver Mr. B has, he cannot really effect demand much (unless he sits on it all, drives prices sky high and therefore curbs demand). Any that he sells is yes...a wash..in market or off market.

But let me clarify my thoughts....let us say that Mr.B. and BerkHath are major shareholders in a company like Kodak (for example, let us say they have $2 billion of Kodak stock). Let us further assume that Kodak consumes 25 million ounces of silver per year (completely out of the air could be more could be less). So, in today's market, Kodak would be spending $125 million on silver. Now let us say that silver surged to $20 and stayed there for at least a year such that the "average price" of silver for Kodak is now $20...without concerving this increases their out of pocket expences for silver to $500 million and eats into their profits. Given that P/E is a common way to price a stock, for every $1 of lower profits generated by rise in raw material prices, the "market cap" of the company could suffer $25-100, depending on how high tech and how growth driven they are.

So If Mr. B. has the option to cut a deal with any company where he owns shares (or wants shares) to "supply them silver" in exchange for newly issued shares...thus no cash expense for the company...the market will appreciate the shares when they see Buffett supporting the company, and the company does not loose competitive edge. And, other market participants who "see that they are not going to get Buffet's silver" are more prone to panic and move price higher..as well as long speculators swinging under Mr.Bs. coattails.

When such deals are done in gold, it is the quality of "gold as money" which is used...

I think what we have to keep on the back of our minds with Mr.B. is that he "loves stock" and he loves to buy when things are down....and he is sitting on as much as 50% of the remaining readily available worlds silver supply in a market with a large operating deficit and a mining industry that cannot ramp up output on short notice. The deeper we get into a silver crisis, the better Mr.Bs. cards are going to look.....and you can bet the popular press will have a lot to say about it...with Mr.Bs. Pic on covers of Mags..as the king of silver....Buffet knows he has TNT in his pocket and when the time comes he will use it.

This will raise the profile of silver and gold immensely.

By the way, did anyone hear that Michael Jordan just bought $13 million of gold and took delivery??? (just kidding, smile)

Poor old Solomon
Peter Asher
(03/03/2000; 21:13:18 MDT - Msg ID: 26351)
4Ducat (3/3/2000; 17:44:06MDT - Msg ID:26346)
Superb campaign piece! You have my vote. (PS if you have them do some reforest tree planting on my property, we can work something out!)

Dollar Bill

Thanks for the correction. I'll pass it on to the Y2K Homework guy from whence it came.

No more forwards from him, promise!
Marius
(03/03/2000; 22:17:02 MDT - Msg ID: 26352)
Peter Asher, Oro
Peter,

Thanks for the lighter note re: Gore, even if the quotes ultimately are proved to be incorrectly attributed. On an otherwise tough day, they were good for a few chuckles.

Al(pha) Gore is cut from the same slimy, pathological lying mold as his predecessor: inventor of the InterNet, discoverer of Love Canal, subject of Love Story, always Pro-Choice, just to name four quick whoppers. That Bradley didn't eat his lunch lends credence to the theory that Bradley's candidacy was a ruse to keep Gore from falling completely off the media's radar screen during the primary season.

Oro,

Who will save us? We must save ourselves. As with FOA's scenario for the eventual separation of the paper and physical gold markets, and the collapse of the former, it is only when we separate ourselves from what we think government can or should do for us that their power over us will diminish. I know I'm preaching to the choir in your case, but this is something we all just have to keep hammering home to those we encounter on a day to day basis. I feel this way every four years, when I see the lame, cookie-cutter offerings from the Republicrats. Then I go vote Libertarian!

Chris Powell
(03/03/2000; 22:26:11 MDT - Msg ID: 26353)
New posts at GATA
http://www.egroups.com/group/gata/399.html?Midas commentary for March 3, 2000:

http://www.egroups.com/group/gata/399.html?


CBS Market Watch features Gold Fields:

http://www.egroups.com/group/gata/400.html?


Fuel costs removed from inflation data:

http://www.egroups.com/group/gata/401.html?
Zenidea
(03/04/2000; 05:20:47 MDT - Msg ID: 26354)
Thanks Black Blade and Galearis
Thankyou for your help :) , I have been surfing the net chasing these geological terms you have so discriptively mentioned with interest :). Gee and on my
Cyber travels sort of amazingly noticed in todays news through my bookmarked contacts that the Wawa
region in Ontario is experienceing abit of a Diamond Rush !
with alledgedly kimberlite truck sised bolders of kimberlite and G9 and G10 Garnets in the area (whatever G9 and G10 means ?. re: the rare earths , gee that sound tantalising. What a golden bunch of incredible people
we have here in USAGOLD. They are mostly dark green all are smooth and shiny and the edges are straight. Isnt nature just so incredibly amazing how such logical shapes can be formed !. Back to Gold :). I met a bloke who found a round rock like lump of quarts that looked like it had been
water worn smooth or something like a river stone . It measured about 8 inches in diameter and the gold in it which en-tranced me was a band about 10mm thick running through the centre of it. He claimed it came from the Marbel bar area in Northern West Australia. What i found interesting and I am no geologist by any means is the
quartz had a blue hue colour saturated through it . I have never seen that before. Just wondering if the blue in the
quartz is a good indicator for gold ?.
Oh my, I still have got Gold Fever :)
View Yesterday's Discussion.

Zenidea
(03/04/2000; 05:41:08 MDT - Msg ID: 26355)
just me
I just re-read the post. I meant generally does the blue hue in the quartz signify better indications of likelyhood
of gold in an area ?. Maybe this discussion has transpired before ?. Has anyone ever stopped to wonder how the world would
function without an adequate supply of Platinum and Palladium for the wheels of industry. Given Russia's
supply problems in palladium alone to me it all seems rather daunting. regards Ray:).
Journeyman
(03/04/2000; 06:53:30 MDT - Msg ID: 26356)
Bubble Alert: Stock-price gambling grows; value investing shrinks

Fund managers are being forced to drop value investing to the back burner and manage for price appreciation at an increasing rate:

- So-called "growth" mutual funds received a whopping $47 billion in-flow of investment dollars during January while there was a $26.5 billion out-flow from "value" funds during the same period. -CNBC, 00/03/03, 2:55:55 PM

Regards,
Journeyman
Trail Guide
(03/04/2000; 07:04:54 MDT - Msg ID: 26357)
gold talk
http://www.the-privateer.com/gold6.html#latestALL: Some good items on the web now. Especially MK's post of USAGOLD (3/3/2000;8:36:06MDT - Msg ID:26331)!

ALSO:

From the Privateer web site: see above

----Gold stocks are STOCKS, they are NOT Gold. This leads to a some further observations. -----


ALSO: some good reading at GATA!

====================================

http://www.egroups.com/group/gata/399.html?

---------------Apparently the foaming-at-mouth
media feel it's ok to have religious fervor if
discussing political freedom, religious freedom, and
press freedom, but not OK about monetary freedom. If
you ant a real 'free market in gold,' free of
government and central bank interference, you are a
fanatic. Yet the paper money in your pocket shrinks in
value every day and always does in a fiat (non-
convertible, dictated) money system, as the supply is
endless.------------------------

ALSO:

-------------"I submit to you that the gold market story that has
evolved a great deal over the past 12 months is going
to change radically in the next 12 months.---------------



I'll be back later for some discussion ,,,,,,,, TG


Journeyman
(03/04/2000; 07:29:59 MDT - Msg ID: 26358)
Gore quotes @ Peter Asher Dollar Bill

I can't swear to all of them but -- sorry Dollar -- most of Sir Peter's re-quotes [Peter Asher (3/3/2000; 15:58:11MDT - Msg ID:26344)] are indeed correctly attributed to Al Gore.

First, just looking at the context of a few of the quotes eliminates Dan Quail as source -- little Danny wouldn't be welcoming Mrs. & Mr. Clinton to a NASA shindig, for example. Nor would he be directly; "I am not part of the problem. I am a Democrat." referring to himself as a Democrat.

What's more, I recognize several of the quotes as Gore's, and if I had the time or inclination could dig them out of my archives.

No, scary as it may be, this guy has a fair chance of being the next president, with his finger on the still existent "button" and all.

Regards & good luck,
Journeyman

P.S. If a few came from Danny boy, well, he was close to the presidency too, remember. On the other hand, I can't imagine that either Gore or Danny Quail could be worse than Honest Bill Clinton - - - - OR George "Butcher of Bhagdad" Bush (Sr.) (responsible for the murder of at least 200,000 Iraqis, half of them women and children who disliked Saddam more than "we" did, killed by "collateral damage.") That's right, 200,000 Iraqis died as a result of the Gulf War alone. And yes, I will quote sources if asked.

P.P.S. Though in later actions against Iraq, terminals on Iraqi soil shipping "illegal" Iraqi oil were bombed by U.S. planes, right beside them terminals shipping petroleum under the UN "Food for Oil" program kept on loading un-bombed & unmolested. Want to guess where ALL the "Food for Oil" oil is shipped? That's right, directly to the U.S.!
Journeyman
(03/04/2000; 10:16:13 MDT - Msg ID: 26359)
Modern stock bubbles relatively harmless?

ORO, TC, MK, Trail Guide, etc.

Several sources, most notably ex RTC chief and now CNBC "Chief Commentator" Bill Seidman, have suggested that the popping of the stock bubble might not effect the real economy much, since the bursting of the 1987 bubble didn't.

Kenichi Ohmae suggests that the bursting of such bubbles has the beneficial effect of reducing what he calls "super liquidity" that is, destroying excess buying power. I was just looking up his exact presentation -- forgot how good it was, and so I'm going to transcribe it, hang on for a moment . . . . . . .

*Challenge to the Traditional Understanding of Economics*

This new phenomenon [development of huge independent FX markets] suggests that several major
changes are taking place, which would challenge the
traditional understanding of economics.
(1) The traditional measure of inflation, the use
of consumer and wholesale price indices (CPI and WPI),
is obsolete. Until recently, overliquidity resulted in
inflation, as a result of excess money buying up
inventory in expectation of higher prices. Today, in an
era of worldwide oversupply, excess money is contained
in tradable buckets, and has not harmed the greater
public by increasing inflation. This is because higher
prices are certain to discourage demand. When supply is
tightened, there is always a high probability of
inflation. We are living with a zebra-like inflation
today, where CPI and WPI are stable, while real estate
and stock prices are sky high. In a way, the creation
and discovery of these liquidity buckets, and the
successful containment of excess money therein, have
been the key ingredients in curbing inflation.
Governments can take little of the credit for this
success. Their sugar-coated monetary policies would
have created unmanageable inflation across the board,
were it not for the invention of the globally
interlinked buckets and the occasional "leaky" buckets
which act as "black holes" (Figure 3.) -Kenichi Ohmae,
_The End Of The Nation State_, (New York: The Free
Press 1995), p. 155

What Ohmae means by "black holes" is that potential buying power is sucked in and completely disappears.

There is more here from Ohmae, but only if someone asks.

Comments?

Regards,
Journeyman
18KARAT
(03/04/2000; 10:23:09 MDT - Msg ID: 26360)
Re: ORO (03/02/00; 18:27:32MDT - Msg ID:26313)
Thanks Oro for your post.
I have printed your commentary out along with the charts for in depth study.
Very useful.
18KARAT
(03/04/2000; 10:41:41 MDT - Msg ID: 26361)
Re: Journeyman (03/04/00; 10:16:13MDT - Msg ID:26359)
It's a very cynical sort of position but there is probably a lot of truth to it.

After all is it really possible that everyone can live for ever after from stock speculation?
Of course not.
So somewhere along the line there has to be a separation between the strong and the weak players.
Clearly the stock market has become a net consumer of shareholder wealth.
When it all washes out in the end, I believe that we will have witnessed the greatest transfer of wealth in history.

All those who buy and hold stocks at their present silly prices will live to regret it. The winners will be those who sold near the top, especially if they were insiders who got their stock cheap as a result of option plans etc.

As long as the market remains at the present inflated prices you'd have to be crazy to buy, unless you are a gambler not an investor.

The overvalued USD (witness the Current Account Deficit ) means that when the market crashes the USD will crash too.

All other stock markets will crash at the same time as the US market.

What other rational options do Americans have, except gold and other PMs?
What else is better money than the USD?
ORO
(03/04/2000; 10:47:36 MDT - Msg ID: 26362)
Journeyman - Ohmae
WE WANT MORE

Is his book available in English? The text smacks of translation.

Thanks

Dollar Bill
(03/04/2000; 12:10:47 MDT - Msg ID: 26363)
Quail quotes
Journeyman,

They are quotes from mostly the eighties and they are
indeed Dan Quail qoutes.
I recognised many of them.
The dates of the supposed Gore qoutes were all ficticious and would require proof before offering any of them up
as Gore's.
I dont support Gore but what is Dan's are Dan's.
They ARE a hoot.
Off topic of course.
Dollar Bill
(03/04/2000; 12:13:26 MDT - Msg ID: 26364)
quail

Journeyman
The clinton and democrat comments are part of the fraud.
As well as the dates.
Not fair to say the least.
Journeyman
(03/04/2000; 13:06:15 MDT - Msg ID: 26365)
Bubbles; more from Kenichi Ohmae @ ORO, 18karat

Well, ORO, here's some more from Ohmae. I suspect you're
ahead of him in several areas, but remember, the section
excerpted here was written quite awhile ago.

"The End of The Nation State" was written by Kenichi Ohmae,
at the time, I believe, the head of McKinsey & Company's
Tokyo consulting practice. Strangely, the following is all
taken from Appendix A, "What Moves Exchange Rates," and
isn't a direct part of the rest of the book. While the rest
of the book is interesting, even as a whole, it doesn't
approach the value of just this one appendix.

The numbers upon which the appendix is built, however, are
older than the book as a whole by nearly a decade --- dates
cited are as old as 1986, for example. This doesn't mean
they're invalid, but things have almost certainly evolved
greatly over the last 14 years.

"The End of the Nation State" is in English, and available
from amazon.com.

Here's what I've got so far - - - and, I'm sorry, but that's
all for today! This is a large appendix, and there's lots
more.

*The FX Market Begins to Have Its Own Raison d'Etre*

{there's more before this well worth excerpting}

...What has happened is that the FX market [which is 10
times larger than the volume of real transactions] has
started to have its own _raison d'etre_, and has
develop;ed unique behavioral patterns that must be
treated with care and interpreted with a new
perspective. For example, the FX market has been proven
to:
* _Dwarf government intervention_. [ corroborating
paragraph not transcribed yet]
* _Not reflect purchasing power._ As Figure 1
indicates, there is no major item which can justify the
current exchange rate of Y140 to the dollar. In fact, a
more reasonable conversion rate is certainly above
Y180, in order to equalize the prices of day-to-day
commodities.
There are several reasons for this seemingly
perplexing issur. One and the most obvious, is that the
Japanese distribution system is much more extended and
less efficient than that of the U.S. Thus, a Japanese-
made camera can be purchased at a much lower price at
the 47th Street Photo Shop in New York City than at
Yodobashi Camera, a Tokyo discount store. A typical
camera or color TV is priced at four times its
manufacturing cost. So, purchasing power, which was
believed to influnece the currency exchange rate in
equalizing prices, needs to be redefined using a
product's cost to the importing decision-maker. [more
not transcribed yet]
* _Yield much better performance than other
financial instruments available in the real world_. In
all but two months over the past nine years, the FX
market has fluctuated more than 1 percent per month, or
55 percent per year for a consistent winner in the FX
market. Quite often, opportunities appear to make more
than 6 percent per month. Similar high yield
opprotunities may exist in real estate, stocks, gold
and, in the case of Japan, golf club memberships.
However, such capital gains are usually taxed to
effectively halve the yield, while the FX market is
unlimited and unregulated in size, frequency of
exchange, gains/losses and taxes.
What this means is that the FX market has become
one of the largest investment instruments in itself,
and is interchangeable with other instruments. At the
root of this problem is the worldwide super-liquidity
problem. In Japan alone, some $1.1 billion is generated
daily from the private and corporate sectors to be
invested. Since there are not many opportunities to
substantively absorb such an amount of money in real
consumption, the excess money ends up in the available
instruments, or "buckets." For institutional investors,
it does not make any difference in which bucket the
money is put, so long as they are interchangeable and
tradable.
...tradability is the key prerequisite for
qualifying as a bucket for cash overflow. -Kenichi
Ohmae, _The End Of The Nation State_, (New York: The
Free Press 1995), p. 154.

*Challenge to the Traditional Understanding of
Economics*

This new phenomenon suggests that several major
changes are taking place, which would challenge the
traditional understanding of economics.
(1) The traditional measure of inflation, the use
of consumer and wholesale price indices (CPI and WPI),
is obsolete. Until recently, overliquidity resulted in
inflation, as a result of excess money buying up
inventory in expectation of higher prices. Today, in an
era of worldwide oversupply, excess money is contained
in tradable buckets, and has not harmed the greater
public by increasing inflation. This is because higher
prices are certain to discourage demand. When supply is
tightened, there is always a high probability of
inflation. We are living with a zebra-like inflation
today, where CPI and WPI are stable, while real estate
and stock prices are sky high. In a way, the creation
and discovery of these liquidity buckets, and the
successful containment of excess money therein, have
been the key ingredients in curbing inflation.
Governments can take little of the credit for this
success. Their sugar-coated monetary policies would
have created unmanageable inflation across the board,
were it not for the invention of the globally
interlinked buckets and the occasional "leaky" buckets
which act as "black holes" (Figure 3.) -Kenichi Ohmae,
_The End Of The Nation State_, (New York: The Free
Press 1995), p. 155
(2) The world's money supply has gone beyond the
control of any single government. Through interlinkage
and the active FX empire, money can now travel across
national borders electronically in milli seconds. Even
if the BOJ tightens the money supply, a Japanese banker
can borrow an impact loan instantaneously from abroad.
(3) Monetary interlinkage has created dollar-based
markets in Japan and yen-based markets elsewhere. In
fact, the U.S. has created an opportunity to invite a
$50 billion investment by the Japanese through its
trade deficit with Japan. The dollar-based trade
deficit is nothing but an accounts receivable for the
U.S., as greenbacks must eventually be used to buy
something American. They may make a detour via OPEC or
Brazil, but U.S. trade payments are bound to come back
to the U.S. In the long term, the trade balance must
equal the capital-account balance, unless the country
goes default or bankrupt.
(4) The notion of interest has become obsolete.
Such attractive profit-making opportunities as
speculative buckets lure financial institutions to stay
within the non-interest-bearing FX market, stocks and
real estate, rather than seeking investment
opportunities in the "real" world. [more] -Kenichi
Ohmae, _The End Of The Nation State_, (New York: The
Free Press 1995), p. 156

{Much more}

Regards,
Journeyman
CoBra(too)
(03/04/2000; 13:46:54 MDT - Msg ID: 26366)
@Journeyman - Re your latest posts -
Seen as a challenge to the traditional understanding of economics ... End of te Nation State -Kenichi Ohmae... Modern stock bubbles relatively harmless - Bill Seidman (CNBC)1987 crash is seen sound in reducing super liquidity ... or the worlds money supply has grown beyond the control of a single government!?
Only excerpts from your excerpts, though smacking of the kind of excuses used throughout history to defend/explain asset bubbles created by exponential money supply. Greenspan
and John Law still will meet or merit the same fate in the end. Please read Doug Nolan's Credit Bubble Bulletin at the Cafe today!
Regards CB2

PS: I would wonder why AG accepted a third term in full knowledge of the problems e helped to create - Is it the hope to correct at least some of the blunders - he still may know better?
samaon
(03/04/2000; 15:01:07 MDT - Msg ID: 26367)
GOLD GOING LOWER
HOW FAR DO YOU THING THAT GOLD IS GOING TO GO i HAVE A TARGET OF 282 ON THE APRIL GOLD, WHAT DO YOU THINK?
Trail Guide
(03/04/2000; 15:47:23 MDT - Msg ID: 26368)
Comment
USAGOLD (3/3/2000; 8:36:06MDT - Msg ID:26331)

----Those of you who read this report regularly know that we don't buy the government statistics on inflation. -------

Michael,
Isn't that so very true! I completely agree. But in a more broad sense, doesn't that just delineate this era into something completely different from other recent (relatively mild) US inflations?

Here we are with a currency that's been in it's most recent extended inflation for 15+ years and almost no statistics show "major" price rises yet. Considering the overall world-wide expansion of dollar assets during this period, we would think 15% price increases would have already been the norm for several years. Along with seeing 15% interest rates. Clearly this is not the case as
somewhere, someone has been buying up our expanded dollar assets and holding them in support of the dollar system. This portion simply cannot be held as an investment, because one must eventually buy something here to gain from it.

I really love how everyone likes to say that all the foreign money is coming here to invest in this system,,,,, and that is why our markets and dollars were so strong most of this decade. Truly, if this was the case, our gross investment outflows minus the foreign investment inflows would have to have covered the huge trade deficit for the past 20 years! It never happened! Take out the expanded dollar reserve holdings of foreign CBs and their matching local currency creations from this and it would show a different picture. A colossal trade flow of dollar assets back into the US for conversion. Truly CB support was the dynamic that saved us from a crippling price inflation.

So, we have enjoyed a position of issuing a reserve currency and having mostly foreign governments support our asset values and lifestyles by absorbing all. This dollars support ,,,,,,, if they stop it's all over, yes? All the past dollar inflation will show up here in the only way that can balance ,,,, in the form of a major hyper price inflation. But not to worry, they have helped us for some time and will continue because the dollar is still the only reserve currency to support,,,, right?

But suddenly our USA official policy has changed from the recent past responses to up-ticks in price inflation. Our officials are doing their best to set the stage of not reporting any price effects at all. Covering the recent past, present and future reports by changing the rules. What gives? Why not do as in the past,,,,,, report rising prices,,,,, and raise rates to control it? We have the tools and support to do this, or do we?

In the past, "real figures" were reported because we "could" do something about them. Raise rates and tighten money! But we always thought (or were told) that these "tools" could be used by themselves. In reality, they never could. The dollar was "the" reserve currency and had to have the full support of other nations in order for this host country to reign in money growth and control prices. Doing so alone would leave us open to the risk of a complete economic crash in our economy. Of course the worlds system would also die because no other currency reserve existed then. So, the risk of "no support" was never there. Today, it is. I think my friends call this a strategic political risk unique for this era.

Yes, we could raise rates in a magnitude needed to control the situation, if the real price inflation figures were reported. But, if at the same time foreign nations decided not to support us and begin slowly converting dollar assets into another denomination??? We would have the very visual effect of a falling dollar with rate rises also appearing as an attempt to stop the currency from failing. Instead of just raising rates for the simple reason of slowing the economy. On top of this, if our present paper system that controls the gold market pricing action was to suddenly fracture,,,,,, the outflow of money into real gold would really make dollar inflation look ??????? Interesting situation, no?

I think today, the Euro has changed things and we are now entering a "final US inflation" because of it! It's not just the last few years we are talking about, rather the complete era. Our past ability to control rising prices without creating a major economic contraction is gone.
Gone,,,, not because the Euro is so great a competition for us,,,,,,, rather gone because "that" block of support has it's own major currency system to support. As a result, our US money printing through reserve expansion is now on a permanent one-way road. It will continue until it converts everyone into a hard money saver and paper sellers. Rate rises will be small and always be well behind the fact. One way or another, our currency value is going to adjust and it will impact every paper asset denominated in dollars.

No, our governments hiding of facts is indeed something more different than in the past. Currency war strategy has a way of doing this. We can expect more in the future. We know that more such under reporting is coming, because these are current signs of a monetary system living it's last days. Once the tools to correct a "regular inflation" were impaired, the final inflation process begins without end. If one is correctly prepared, it's going to be a real show to watch!

thanks TG


Farfel
(03/04/2000; 16:09:34 MDT - Msg ID: 26369)
MARCH: A Critical Point for the Markets?
Scanning a variety of gold websites today, I've noticed a huge increase this weekend of anti-gold visitors. They are peppering goldbugs with more than usual negative commentary about their investments, the usual taunts such as "don't you wish you had bought CISCO two years ago?" and "even a stopped clock is right twice a day," etc., etc.

At the same time, the other day's Bank of England announcement of gold sales continuing beyond March is designed to demoralize gold investors and force capitulation. After all, it is demoralizing to see an institution fail to acknowledge the lunacy of its profit-MINIMIZING actions and continue down a road of insanity.

Gold is once again under 290, having been egregiously manipulated downward by all variety of market subversions, most notably the failure of gold market regulators to require Goldman Sachs to have its client Ashanti Gold cover its margin calls (as would be required of any other gold market participant receiving margin calls). Such margin covering would have sent the gold price soaring, thus presenting all variety of problems to Goldman Sachs itself. That, in a nutshell, is why it never happened.

Gold is under 290 at a time when most gold investors are extremely sick and tired of holding a non-performing, money losing asset...at a time when the NASDAQ is in a full vertical mania and it seems there cannot possibly be an end in sight...at a time when only the most powerful inner conviction can sustain a person against the almost daily taunts and jeers from the maniacal crowd who keep parading their huge profits in front of the "non-participants."

No doubt the swarms of anti-gold attacks are occurring again as it becomes more important to find liquidity anywhere anyhow to keep NASDAQ in full vertical mode. Trees cannot grow to the sky forever. So those bulls cognizant of this Law of Nature go on the attack, targeting any capital source (such as gold) that can be converted to join the mania. I would not be surprised to see another US hedge fund soon attempt to raid another international currency/economy in order to decimate it and force new foreign capital inflows into the American stock market.

A couple of years ago I stated that I believed a market crash was in sight. I was categorically wrong at that time as I had no concept of the degree of manipulations and interventions this government would utilize over the next few years to prevent the market from finding its natural lower equilibrium.

Now I believe that we are at a critical juncture and the usual historical manipulations and interventions appear insufficient to maintain market verticality. Moreover, I believe the Establishment itself is now increasingly worried that they have created a true Frankenstein. So bipolarization of Establishment interests appears to exist, with some Establishment factions convinced they can maintain this vertical mania ad infinitum while an opposing faction demands the bubble be halted for the sake of protecting America's future. Therein lies the Achilles heel of this bubble: the absence of unanimity in the virtue of the bubble, an internal internecine war between the collusional Establishment interests.

So either the gold market will be crushed this month or the stock market but I do sense something dramatic about to occur soon.

Meanwhile it is best that gold investors who continue to see the merits of their investments go forth and educate others in the same manner that anti-gold opponents infiltrate gold sites to discourage gold exponents and force capitulation.

Gold's value will not be recognized until a mass perceptual shift occurs in the markets and that shift will not occur if gold investors stay rooted inside their safe gold chat enclaves. They must continue to debate and challenge mainstream thought, not simply for the sake of their investments but for the sake of the American economy itself.
That is because, despite the outward appearance of prosperity, the economy is sick and growing sicker by virtue of rapidly escalating distortions developing between paper wealth and real wealth.

Thanks

F*
USAGOLD
(03/04/2000; 16:51:08 MDT - Msg ID: 26370)
FOA, ORO, Journeyman...
Have you fellows begun to notice that fewer and fewer of the economic indicators that we once viewed as crucial to any legitimate economic analysis just don't matter anymore. Deficits don't matter anymore, because we just owe the money to ourselves and a bunch of gullible Japanese and Arab financiers who are afraid to call us on it. Money supply doesn't matter because the money just runs around the globe in a never-ending transmission from terminal to terminal and never really gets into the economy. Bubble stock markets don't matter anymore because no cares whether or not corporations make profits anymore; all you have to make is good public relations and M&A possibilities and your stock rises. (The Time Man of the Year runs a company which sells books it buys for $20 at $15. He has never turned a profit, yet he is a modern hero.) Oil doesn't matter anymore because this is the energy non-reliant computer age not the high energy use industrial age.

Etc.(Anyone have any additions to the list?)

So what does matter?

Why not run a 100 trillion dollar deficit and insure the income of every man, woman and child in the world for the next decade and worry about the consequences later? Why not in the process run the money supply up to $100 trillion while we're at it and really give the forex players (and the equity markets of the world) something to toss back and forth? Why bother running a business to make a profit, let's all just create a bunch of companies and trade the stocks back and forth to each other until we all get rich? Why not shut down our oil imports, close down the oil industry in the United States, and all live off the warm glow of our computer screens (at least until the electricity goes out).

Why not?

None of that stuff matters anymore.
megatron
(03/04/2000; 17:01:39 MDT - Msg ID: 26371)
manipulated numbers
Does any of this inflation statistics nonsense really surprise anyone, in a world where most students learn economics based on Keynes' socialist stupidity?
tedw
(03/04/2000; 17:06:49 MDT - Msg ID: 26372)
The Future of Gold
http://www.usagold.com
These are just my own thoughts on the future of gold, and they may not mean too much.

Gold has surged upwards twice since October, only to drop
back down dramatically. It seemingly cannot sustain a rally, although the $280-$290 level is higher than the previous $255.

What must happen for gold to rise and stay there?

1) Runaway inflation. That would do it of course, but although indicators of inflation are on the rise one could not call it runaway at this time.

2) Stock market crash. A Stock market crash would cause the investment dollar to seek safer havens, but I do not think Gold would be the first choice. Bonds, real estate etc. would attract the investment dollar before Gold due to their
income producing ability.

3) Stock market crash couple with runaway inflation.These 2 factors working together at the same time would cause investor flight into gold.

4) Announcement of suspension of some or all Central Bank sales. I have no idea how likely this is, but one would think a combination of 1,2 might prompt Central Banks to consider suspending sales.

5) Widespread warfare in the world. I think this could do it too. The rumblings out of the Mideast, China, and Europe make this a distinct possiblity.Considering what human nature is, widespread warfare again seems like a distinct possiblity.

I dont see any of the above happening soon except a possible market crash, or warfare. Runaway inflation takes time and possibly we are seeing it beginning to develop.

Gold is a barometer of trouble. As the troubles increase expect to see the price of Gold rising.

In the short term, the next few months, I dont expect we will see much change.

Sir Tedw- professor (American School of Hard Knocks)
nickel62
(03/04/2000; 17:12:00 MDT - Msg ID: 26373)
Farfel Hang in there the other side knows they are losing that is why all the BS.
Your post was right on. We are being given one more opportunity to buy gold cheap and we should all take advantage of it. You can bet the Indians and Chinese are. It is always darkest before the dawn and I think I can see alittle light in the distant horizon. Maybe its just Goldman Sachs burning another client, but it might be the begining of balance returning.
Golden Truth
(03/04/2000; 17:49:33 MDT - Msg ID: 26374)
TO TRAIL GUIDE
Howdy Trail Guide, I have only one question, in your best educated guess how many years, before the show gets "real interesting to watch" Sorry to be blunt but i think alot of us are sick and tired of waiting. Please be honest in your answer, i see this dragging out for many years before we even see any sort of action. When i first started reading "Another" he gave the impression that a rise in the P.O.G was imminent and that was a year and a half ago!

In the last year i've seen my company's shares more than double and guys at work make 2.5 times their investment in 8-10 months on shares they bought for 10cents!
Tell me why i should hold on when "another" doesn't even bother to post anymore. He was the reason why i bought Gold to begin with along with your earlier postings in the bad old days?

Is it possible we've all jumped the gun here a little? I,am beginning to see this as a 5-10 year mission of the Euro vs the U.S. In terms of a day trader thats an eternity, and no i,am not one! I only have been holding Gold coins since i started reading another and yourself.

Thanks in advance but some idea as to when this "timeline" is about to end"In terms of GOLD rising" would be i think justified by now? Thankyou very much and look forward to hearing from you. P.S thanks for all the "Hope" you've given us, but i need something a little more concrete, Sorry!

G.T
Trail Guide
(03/04/2000; 17:50:29 MDT - Msg ID: 26375)
Comment
Hello Solomon,
You write:

Solomon Weaver (2/23/2000; 22:12:25MDT - Msg ID:25912)
Is it Kuhn who gave us paradigms?

-----Something on the back of my brain tells me that the phrase "paradigm shift" was coined by Thomas Kuhn in a book called "the Structure of Scientific Revolution". It keeps reoccurring to me that FOA is telling us about a "new" gold market, which will behave much differently than the "old".
And many of us analyse the current market using today's perspective...----------

-----------------------------------------
TG:
Yes, I think this is a major problem and one that will backfire on many investors. Let's face it, no matter where the average investor resides in this world most all of them operate with a perception that the dollar will remain the worlds "supported" reserve currency. Few of them fully appreciate the impact a deviation from that norm would create.

They buy into gold derivatives with a dogged determination that the dollar price of these securities will always reflect the physical trading price on an equal or greater basis. It won't. It can't!

We can trace almost all of this perception from the views of the "gold trader". A perception that the entire "Western gold market" is built upon. He's primarily a paper trader of gold stocks, gold stock options, gold futures, etc.. Their whole strategy rests on the argument that the "price of physical traded gold" will wait for them to convert their paper profits into gold if the run really gets started.
The very leverage they play for is the same leverage that will gun the physical price faster than they can ever move.

As I just noted to MK, the publics real price inflation grasp is going to be from real events. Not from the past official policy of telling us how it really is. In this atmosphere the sponsors of our paper gold market are going to have a free hand to sell (create) contract gold without end. The more the Fed guns the reserves, the more the cash liquidity will be available to sell gold. Because so few of the paper traders wish to exercise these contracts, price discovery is totally in the hands of the market sponsors.

Because of this, at first dollar hyper inflation will not be reflected in a rising price of gold on the current dollar paper gold market. It will be reflected in a corresponding lack of real gold relative to outstanding contracts! A physical gold shortage will happen "first", as the contract price system slowly defaults in an ever lower price. Next the paper markets will totally fail from non availability. That means a super low (discounted) bid price for contract gold. That's the same price the stock market players currently value your gold shares with.

Once the dollar gold contract system fails (and this will be happening during a full blown "hidden" price inflation), a physical gold market will develop,,,, weather officially (Euroland) or black market style.

The point is that during this dollar inflation, physical gold will be in almost no supply and it's price will be 10X the paper price. No body, and I mean NO BODY is going to be cashing out of gold shares or any form of paper gold and doing an even swap! Every gold mine that operates using the
dollar gold market to sell into,,,, does it's financing with and is hedged leveraged with dollar based Bullion Banks ,,,,,, is going to see their stock ride the paper gold market to it's end.

A few of them will be allowed to tie themselves into ECB/BIS physical sales, very few! Many will try, but only if they can escape their financing ties with banks, that themselves are locked into the current paper bullion market. It's that simple.

I've mention this dynamic before. It's the main reason why I own only a very small slect few gold shares. If they fall,,,,, it will not impact me at all. Of my hard money "metal" investment portion of wealth,,,, 99% of it is in "non-USA Legal Tender Bullion". But not completely for the reasons our site provider does it (a good portion is in K-rands and bars, the rest in early and rare bullion). I'll
discuss this a later time.

We are always watching for the political dynamics to change, but I think only two things could make this happen.

First,,,, The US Fed would have to suddenly decide to break the current inflation on it's own and shut down all liquidity operations. Strangely enough, this would have the absolutely opposite effect many think. In today's changing times, such a deflationary move would completely fracture the contract creating ability of the Bullion Banks. The paper gold market would soar first, then lock from failure. Obviously, mines and their shares would do very well in such a situation. "If" investors could understand the positive effects such a dollar deflation would have on gold.

Second,,,,, our current process will change if Euroland decides to bid and trade openly with physical gold outside the LBMA marketplace,,,, and do so at ever higher dollar prices as they dispose of their mountain of dollar reserves. This is a very real possibility during this developing
currency war.

Otherwise, they have decided to let the "Western gold traders" live in their "paper market" and die in their own stew as the contract prices fall to ??. All the while letting the paper market have it's way with us,,,,, as they withdraw from supporting the dollar while the Fed tries pump liquidity as a real price inflation breaks out.

Solomon,
It's some interesting drama unfolding, no? Your advise in this next post is "right on"!

Solomon Weaver (2/23/2000; 21:22:54MDT - Msg ID:25906)

-----So, given that this is not the current structure of the gold market, and that it is only likely to change when there is a massive problem in the status quo, it is actually very safe to say that the real bull cannot come until the paper market of today collapses. Until then, it is really only that bear in disguise that I mentioned a little earlier ------

------I think what Trail Guide is trying to tell us is that now is the time to get some gold for yourself, because when the destructive bear/bull enters to make way for the real bull, it will be much too late to get real gold at prices of today.------------


Thanks,,,,,,,,,,,, TG

I have to read / study some contracts for a while. USAGOLD back and respond a little later (smile).


Journeyman
(03/04/2000; 17:57:05 MDT - Msg ID: 26376)
Harmless bubbles & other fantasies @CoBra(too) Msg ID:26366)

Hi CB(too)!

I don't believe in Santa Claus either. In the long run, even if Ohmae has a valid model, the "financial" economy MUST cause imbalances. To the extent people BELIEVE they can get more EXPECTED return from gambling on price appreciation, whether in equities, real estate, or Tokyo golf course memberships, the harder it will be to get assets for other things like roadways, automobiles, etc. - - - and at some point, the prices of these things MUST rise - - - - OR they will disappear because they won't be manufactured anymore.

However, there's another effect helping the FED and fiat. Peter Drucker (and others) make a strong argument that by this year only 18% of the population of "developed countries" will be making or moving "stuff":

"By the year 2000 there will be no developed country where
traditional workers making and moving goods account for more
than one sixth or one eighth of the work force."
-Post-Capitalist Society by Peter F. Drucker, pg. 5.

We know that automation is having big effects. For example,
farming in the U.s. employs less than 2% of the population,
though food is still the biggest export. And this
percentage is down from about 45% around 1900. These kinds
of effects can be seen in all sorts of other manufacturing
as well. These developments mean falling prices. We can
expect automation to continue to reduce needs for employment
in the manufacturing sector below even that 18%, and reduce
prices. This suggests it will take less and less work to
buy these "made and moved" goods.

At the same time, this will enable the "real economy" to
survive on less and less input, enabling the "financial"
economy to absorb more and more without completely choking
out the "real" economy. But my gut level intuition says the
financial economy can easily suck-up everything offered it,
and then some.

Further, if Drucker's estimates are correct, it suggests
that at least 80% of the population of "developed countries"
will be doing something _other_ than "making and moving
goods." How about similar stats for the world as a whole?
What, exactly, will people be doing? Service things?
Gambling, ah, financial market things? What?

Regards,
Journeyman
CoBra(too)
(03/04/2000; 18:57:14 MDT - Msg ID: 26377)
@JM - re Peter Drucker
I'm aware of PD's insinuations - developed countries only "move and produce" 18% of stuff of their GDP. OK - the post industrial society may be happy in servicing the post- service industry and LDC's!
I may have a "virtual" problem right here in my mind, as
to how the rest of the world will get paid for the accrued account deficit of the US (and EU to a similar degree)- after all it is consumption of mostly "moved and produced" stuff by others, only partially (poorly) benefitting from the grand services offered by the paper $/Euro/Yen claimants.
Even if developed nations only need a puny part of their
GDP to take care of their livelyhood - great (though I would intuitively contest it, since I feel it may turn out to be a short sighted phenomenon, based on virtual unreality of the fiat Bucck), I would point out the Garden of Eden on this world was already closed to even the few Hollywoodians before Jurassic Park.
Consuming and moving real products, eventually may again
be defined by real countervalue, weighed and measured by real money.
Regards CB2
PS: Agriculture - is a matter close to my heart - wi'll disscuss anytime!

Harley Davidson
(03/04/2000; 19:34:48 MDT - Msg ID: 26378)
Anyone...
I've just read Trail Guide's Message ID 26375 (several times) and can't help but wonder why BOE would continue to sell their gold reserves if such a scenario were to unfold. What could they possibly be gaining? What am I missing here?
Al Fulchino
(03/04/2000; 19:47:15 MDT - Msg ID: 26379)
A couple of lines worth noting.
TG writes:

. Soon, bullion will return to doing what it did centuries ago. Representing the value of the worlds assets and productive wealth. Only, with the world having far more in the way of modern things than ever before in it's history, "Freegold" trading as a "reserve asset" will be valued as never before.

end quote

It would seem that just a little gold will go a long way. We (the general populace), will largely be caught off guard when the rain comes.

lamprey_65
(03/04/2000; 19:53:14 MDT - Msg ID: 26380)
Harley Davidson
After much thought on the subject, it is my opinion that the Brits are protecting calls on gold, probably their own. By selling in the manner which they've set-up, they insure attention is paid to a lower price paid as the lowest excepted bid price is the only price quoted and the entire 25 tons is moved at this lower price. They are losing money on possible returns on the gold they sell, but probably less of a loss than if gold went to $400+ an ounce and endangered the calls. They must be in MASSIVE trouble on those calls. It's the least of two evils for them...it's the only thing that makes sense to me -- why else would you give up the potential gains from a closed offering such as the Dutch have used (and already moved 100 tons within a matter of what, less than 6 months?).

It's the best explanation I have for the manner of the sales and the timing of their original announcement - right as gold was about to break above $300 last spring.

Lamprey
Harley Davidson
(03/04/2000; 20:27:52 MDT - Msg ID: 26381)
@Lamprey_65
Thanks for the insight. I'm starting to gain an increased appreciation for physical.
Cavan Man
(03/04/2000; 20:42:02 MDT - Msg ID: 26382)
Sir Trail Guide
On investments and financial insurance.....Your analysis is of course the most compelling reason to own gold. The accuracy of your predictions will reward the investor as well as the paranoid gold bug (that's me).

My hard metal investments are much same as yours thanks to the excellent coaching by MK. I'm wondering though; in such a world as you envision, for the average American and in fact for the average person generally speaking in a global context, what better investment than gold period! After all, gold is very liquid if needs be.

Peter Asher makes a good point regarding woodlands and farm land. Myself, I prefer the latter. For US citizens whose personal residence and perhaps rental property or second home are denominated in USD, the through the looking glass perspective might not be appealing at the time of "troubles" you forecast and thereafter.

Certainly a US citizen can change USD for Euro or any other currency and maintain an offshore account. No longer does a person have to go to Switzerland or an exotic Isle and/or have huge sums of currency to open an account. Why, if I had a notion (as we say in the midwest), for as little as $3K I can open an account in privacy at the Bank of Ireland and avail myself of other "depository" services. One need not even be a citizen of the European Community (although I am.) With the current change rate for Euro, although it could go lower and well might, to me, it looks like a decent play; at least to get started in a small way.

Regarding 401K and IRA's, really, if time proves all things as you suggest, who needs 'em? Why not take a hit or two and buy metal? I understand the part about multiplication of principle tax deferred. One can buy American bullion "legal tender" coins for example and hold in an IRA but, at the end of the day, all you really have in a very troubled gold market using that strategy is a piece of paper, a receipt. Sure, the custodian insures the account I suppose but probably the insurance is USD and not AU.

Now, our good friend Holtzman has repeatedly counseled diversification and certainly, that is a good, no, very good thought. It is wise and prudent. My question is, diversify into what? I never thought Y2K was a good reason to own gold and as far as wars etc. are concerned, there are other tangible materials that a person should be prepared with. I am really getting concerned (now) about the US equities markets. If the US market "crashes" the pain will be felt in equity markets around the globe. On top of that concern are your walks (not!) in the park. My friend, that's a peck of trouble (not happiness for you Brian Auger fans) just around the bend.

I'm way too long here and my cigar and pint of Guinness are waiting on the front porch so I'll take my leave. I am interested in any and all thoughts. Thank you all. What excellent company! Good evening.
Cavan Man
(03/04/2000; 20:43:24 MDT - Msg ID: 26383)
My last post
Sorry, that was addressed to the entire Forum as well as TG. Any and all comments are welcome for discussion. Thanks.
Solomon Weaver
(03/04/2000; 21:15:43 MDT - Msg ID: 26384)
Trail Guide - chasing mortgage with gold stocks...
Trail Guide

I would beg to differ with you on the value of mining companies...just a little.

I will agree that if distortions in the paper pricing gold market drive the price down dramatically, the classic result will be for the price of gold mining cos to fall too...but in the end, these companies are not producing paper gold ... they are producing real gold. We should also remember that when the paper POG falls below the cost of production, unless miners have an outlet to get a "real price" they will simply stop producing.

It is also not really in the interest of the short sellers to drive the price way down...just keeping it tame where it is is enough to keep their books in line..as a matter of fact, as the paper and physical markets begin to separate, the shorts will look even better, since the paper POG will fall dramatically. Until counterparties tell the shorts that they have to "go into the new physical markets to buy back"!!!!

I look to the BIS to be the "new market" in a crisis. When they see that the Yankee market is locking up, they will be the default for large parties who want to sell or buy real gold. They will do this because they will want to stabilize the bipolar currency market (dollar/Euro) to allow an "organized slide" of the dollar. At the BIS (or the market backed by their name), mining companies (who have material free from hedged contracts) will be free to deal with gold buyers. Euroforces will have a vested interest in showing a publically traded real price for gold both in Euros and in Dollars.

I and a few others around here think that the paper default could come first in the silver market...given that silver inventories are almost gone and the chronically low price has kept new mining production investment on the sidelines. The short squeeze in silver is not going to be a paper battle....it will be manifested by the phenomenal "official" physical silver shortage and production deficit vs. physical demand. Fortunately for us gold investors, we might be able to get a preview for gold in watching how COMEX and LBMA manage the soon to come silver catastrophe...

The reason this silver catastrophe is guaranteed is because almost all of the silver that could be brought into the market by "leasing" is in...there are only now 2 pools left. The first pool is what is already in the market vaults...and in principle can be "purchased" at today's price....the second pool is material outside the market which can only be brought in by letting silver price rise...and not just from $5 to $6....rather to $10+ which will do a lot of damage to the short side of the market. All of the fundamentals are much worse now (meaning more bullish) than when the Hunts took silver to $50, so either it does something like this again, or there is a "halt" to paper trading. Silver will set the tone and method for how to handle a problem in gold.

You also imply that the understood purpose of owning a gold mining company would be that the "market value in dollars" would grow fast enough to allow one to convert those dollars later to more gold. I see another value to owning mining stock....the largest debt which I have today is the mortgage on my home. If there is serious hyperinflation, I am concerned that the terms of the loan might be changed to protect the banks "return" (ie obligation to covert debt to new fiat of some kind)....At that time, I don't really want to be walking down to the bank with my gold coins to cut a deal....but, if I own stock in gold mining companies, I "hope" or (hedge) that in a crisis towards gold, I can sell out my gold shares "at anytime" in the crisis which I deem correct, to "lock in" a "dollar sum" which is able to cover my mortgage obligation. Thus, with the dollar value increase of my gold stock I do not chase a rising bullion price, I chase only a fixed priced obligation.

Certainly this is the same reasoning that many others use for "normal" stocks...and I may be a fool to think that a gold stock can rise when all others are falling...but those are the chances I take...

My real gold is held for even harder times (or even better times).

See you out on the Trail

Poor old Solomon

Trail Guide
(03/04/2000; 22:57:31 MDT - Msg ID: 26385)
Reply
USAGOLD (03/04/00; 16:51:08MDT - Msg ID:26370)

---------Why not?-------

Michael,
This whole inflation picture fits so perfectly together now, that none of us want to believe or fully accept it. Even I reserve a small corner of my brain for doubt. Honestly, none of this thinking came my way on it's own conception. It was drilled into me by others over many years. Long before most of what the last few years made apparent.

Today, I have the luxury of accepting this broad hyper-inflation view with confidence. After watching it progress for so many years and using this different perspective, all the current contradictions make sense to me. It does all fit so well:

Allowing the stock market to run away with no hint of trying to stop it.

Letting the money supply and bank reserves grow uncontrolled.

Forcing down interest rates after the LTCM problem.

Watching the trade deficit explode with no thought of intervening to lower the dollar exchange rate.

Changing the rules for calculating the PPI and CPI.

Buying in 30yr. treasury bonds so the markets would not expose the cost of a runaway money supply.

Promoting to the world that we are paying off the national debt when we clearly are not.

Even going against their own system and accepting a new definition of gold in the IMF. Just so they can keep some foreign dollar assets alive a little longer.

Paper gold traders talking about slicing out their piece of the pie using the same leverage that got us here in the first place.

Oil prices that can only indicate a withdrawal of support. Indeed, the very kingpin of support that has made the dollar last so long.

On and on and on!

These are all the things of a dyeing money system. One running on it's last breath as those that control it can only maneuver to prolong it. Not save it!

Yes, the trail up close is so very clear while the fog of human emotions clouds the far view.
Thanks TG

----------------------------
Golden Truth

Hello,
I see that you need concrete advice.

First, you can only own your wealth in a way that your heart and understanding tells you. Perhaps you placed far more of your assets in metal than you could hold "through thick and thin"? I have been buying bullion for a long, long time, but it's not so much of my wealth that I have to sell it. I admit, it is probably much more than most anything read here. But then, I don't know who is here, do I? How about you? Do you have to sell because you own "too much"??
Owning physical gold as I and others do is like having a bank account. I don't check my bank every day or month to see if the dollars and Euros have gone up or down against other currencies. If the dollar fell against the Yen by 30% (as it has in the past) I can tell you I won't draw it all out and dump it (the dollars or Euros). The simple truth is I don't own gold for trading as so many "Westerners" do. I own it because some very sharp people have educated me about how the real world works. I fully well expect that world financial dynamics and human nature will drive gold sky
high and keep it there for the rest of my life time. For myself and my friends, we don't need to know exactly when. Whether it's next month or five years from now is good enough. The fact that around 1997, political conditions existed that could have prompted a bid for gold didn't change my plans or lifestyle. Placing a good portion of ones wealth in gold at $380, $370 or $360 didn't destroy their future or mine. I still own that very same gold today and have never sold. I have only brought more. Truly, it didn't disappear as some stocks or leveraged options did. It didn't plunge like the major mining shares did. We didn't buy gold stocks or leveraged derivatives based on any possible outcome. Nor should have anyone else in in this "new era",,,,, in my opinion.

Second, knowing what you know now, should you sell it all and buy back later. Or never buy back? Or invest in the stock markets. Perhaps the Dow will double several times over again. Is that the answer? It could be for you?

If you do decide to hold only paper wealth, you will certainly not be alone. Many people are going to sit in paper and watch and see how this all plays out. Some in the "right" investments and some in the "wrong". Where will you be?

Third, I give this insight from myself and others. It gives you a view through other eyes. All through history people have won and lost. Others have watched the ones that win and lose. I can only say that wherever you stand when the music stops, it will be a place you remember all your days. For
myself, if the Dow goes to 1,000,000, the Euro goes to 30 US cents and gold hits 5 cents,,,, at least I will know where I stood,,,,,, when the music stopped! But even then, I will not be broke.

Truly, some people cannot by nature gain by following the path of others. I can and I do.

If you don't understand my position now my friend,,,, you never will.

Thanks TG
Trail Guide
(03/05/2000; 00:50:28 MDT - Msg ID: 26386)
Reply
Cavan Man (03/04/00; 20:42:02MDT - Msg ID:26382)

Sir Cavan Man,
The real unknown here is the total amount of physical gold we all hold in out portfolio. I remain vague about it because one can only buy wealth with their own understanding. None of us know how long we will live, and I can tell you it takes most of a lifetime to understand gold. So it's best to buy a percentage equal to what you can grasp. With the rest do as you say, buy land and other
forms of wealth.

Just as I mentioned to Golden Truth in what I believe is the proper perspective, gold is not an investment. It's buying another form of long term wealth. Yes, I'm certain that all the items I point out will eventually impact gold for the better. But I don't buy it with the perception of making those forces work for me through trading. Once one does that, you lose the ability to see it as a wealth
holding. It becomes an investment you can win or lose with. Or worse, we leverage it. Then it loses all the fine attributes a hard wealth holding was intended to have in your portfolio.

Many, many people have learned that bitter lesson. We only read and hear about the wise people that "just brought that mine share" around it's lows. Not too long ago! And if they had it earlier, they were smart enough to "trade it" using moving averages and "Comex traders commitments numbers". It seems everyone will admit to the "little loses" but will never tell you the whole story. That is that their current "gold investment" would really have to go up 1,000% for them to just get even from all the "little loses" (and in truth big loses) they took over these last many years. Still the song is sung about their recent 50% gain they just made. I just (smile)!

We only point out the Euro because it's dynamics are what will impact gold the most. A Euro account will only benefit you if you can live abroad. I can and sometimes do. I don't present it as a "trade", it's a possible bank account or demographic unit one may want to hold some of their wealth in. As an American, I have always presented physical gold as the very best way to protect our other wealth. For myself it is a great portion of my wealth.

I also present from the position that our present paper gold market has in itself leveraged the actual physical market. If the dollar paper market fails, it will make physical gold rise in the greatest percentage. Further, the inflation of all dollar assets are what creates an even greater leverage against physical gold.

In this position I am not a "gold bug" in the modern "western sense". They are almost 95% in paper derivatives of gold. Gold stocks included. Here, I am truly in the minority. Actually, if one looks around world wide, official physical gold trading is less than 10% of paper gold trading. Off the records it's huge.

Again, most of the paper is put in play by dollar based traders.

I hope this further expands my views (smile), TG

---------------------

Solomon Weaver (03/04/00; 21:15:43MDT - Msg ID:26384)

Hello again Sir Weaver,

You write:-----I will agree that if distortions in the paper pricing gold market drive the price down dramatically, the classic result will be for the price of gold mining cos to fall too...but in the end, these companies are not producing paper gold ... they are producing real gold. We should also
remember that when the paper POG falls below the cost of production, unless miners have an outlet to get a "real price" they will simply stop producing.--------------

TG:
In the end, could be yes and could be no! You know how a true forward sale works. So, if contract gold falls far enough and interest rates spike high enough,,,,,,,,,,,, their banks will force them to forward sell below production and let the rates on the "portfolio pool" bring their cost back to break even. This selling further puts pressure on the contract prices.

Then there is the political agenda. If the mine means enough to the local economy, the government could carry the shortfall by carrying the "pool note" at an even higher rate.

--------It is also not really in the interest of the short sellers to drive the price way down...just keeping it tame where it is is enough to keep their books in line..as a matter of fact, as the paper and physical markets begin to separate, the shorts will look even better, since the paper POG will fall dramatically. Until counterparties tell the shorts that they have to "go into the new physical
markets to buy back"!!!!-------------

TG:
Solomon, these modern market sponsors mostly do not actually sell gold short in the old sense. They write contracts against their cash equity. They don't even think physical gold, they think in cash settlement terms. If someone shoves cash at them and says write contracts, it's done! Gold isn't part of it. Indeed, the lower the contract price sinks the less likely any counterparties are to call for gold. Because, if,, and that's a big if,,, any physical callers are still in paper by then, they know a big call is an invitation for arbitration, plain and simple. Today, starting Sept. last year,,,,,, this market became a huge cash settlement arena and all the big players know it. The few physical sales (BOE and Dutch) are but little band aids that are used to manage it to some degree.

-------I look to the BIS to be the "new market" in a crisis. When they see that the Yankee market is locking up, they will be the default for large parties who want to sell or buy real gold. They will do this because they will want to stabilize the bipolar currency market (dollar/Euro) to allow an"organized slide" of the dollar. At the BIS (or the market backed by their name), mining companies (who have material free from hedged contracts) will be free to deal with gold buyers. Euroforces will have a vested interest in showing a publically traded real price for gold both in Euros and in
Dollars. ------------------

TG:
I mostly agree. But, mining companies free from hedged contracts are not out of the woods by a long shot. The present group of Bullion Banks finance virtually all new mined gold from beginning to end. Don't think for a minute that a BB in deep water because it's paper market is sinking will let it's mine clients just sell their gold wherever they want.

If the world contract prices are in the dumps, and a physical market is not considered "legitimate" yet (as in not the true price or black market), all mine valuations will be in the toilet. Pardon my french! In this brief atmosphere, banks will have a free hand to seize assets and force financing at will. Plus all the government intervention that may happen.

My point is that the risk of investing in most gold mines is far greater than the perceived reward. That's because most investors rule out a great rise in physical gold while seeing only the positive side of the stocks. At best, mines have ten times the risk of gold with only a small possible gain premium. Yes, under some possible workouts they could soar. But tell that to the people that own mines today that are on the edge of shutting down.

As Mr. Eastwood would ask "You just got to ask yourself,,,, do you feel lucky?" (big smile)

---------I don't really want to be walking down to the bank with my gold coins to cut a deal...-------------

TG:
I agree, it would be far more profitable in selling only a little of your much more appreciated gold to MK and using that proceeds to pay off the mortgage. Thus having extra gold already and not having to buy bullion later with cash (another smile)

Solomon, I hope my views offer a different perspective for yours and others thoughts.


I must go now,,,,,,,, see you on the Trail,,,,,,,,,,, Trail Guide

View Yesterday's Discussion.

law
(03/05/2000; 01:22:00 MDT - Msg ID: 26387)
Comments for Golden Truth and Trail Guide
Apparent last gasps of a dying money system
Golden Truth:
Please, do not be disheartened! Truth is responsible to no one. This was a statement from a friend today as we were discussing the "state of the world"...his viewpoint is as an extreme sceptic who believes the international powers that "be" have things under control as they want to contol it...and anyone "messing" with the illusion they have created will just disappear. Although I concurr with some of his thoughts, he will concede a slight chance for a major mistake. But...one can still gather in their experiences and perceptions of the world...utilize the intelligent meanderings of the many on this golden forum...give their thoughts a perspective they can feel comfortable with...find a balance...prepare for several different scenarios...mentally, emotionally, and financially...get comfortable with their doubts and scepticism...hold true to their convictions with flexibility...and, I believe...find the path truly golden...yellow "bricks" maybe, but probably not "concrete".
The "maddening of this crowd"...could take us just about anywhere...but, I believe the path (I've been on it for almost 20 years now...and although not financially rewarding up to this point it has kept me in tune with world "happenings") that Trail Guide and others have chosen...is as good as it gets...and I thank him/them for that.

Trail Guide:
But even then, I will not be broke!!! Thank You!!!
Canuck
(03/05/2000; 05:18:59 MDT - Msg ID: 26388)
Fever pitch
A little story on a slow Sunday morning.

I live a couple miles from the Corel Centre home of the Ottawa Senators. Over the last 3 or 4 years I have watched the area transform from farmland into a 5 square mile plot of 'strip mall' after 'strip mall'. There is now every conceivable restaurant, retail store, and shopping convenience (non-convenience) known to man.

On 'game night', usually starting at 6:00 pm, the entire area gridlocks with traffic. I avoid the scene like the plague; I always get home before the rush for it is guaranteed every man, women and child going to the game has the pre-game dinner et al planned and driving anywhere in this little sub-urban city is impossible.

This Friday was 'spooky', my better half and I were caught in the middle of 'it' around 7:00pm. We were in the most dense 'restaurant' area where SUV upon SUV were parked (the one I took note of was on the front lawn of a near completed fast food joint), massive line-ups of mini-vans and SUV's and general traffic chaos when this conversation broke out.

I said, "...oh sh*t, it's 7 o'clock.... who's in town tonight." (refering to the visiting hockey team)

Better half replies, " There's no game tonight."

" What do you mean 'there's no game tonight', look at all these morons, what the hell are they doing?"

B.H., "They're eating and shopping."

"They're eating and shopping??!! That's nice. Did everyone on the planet get paid today?"

It was at that moment it struck me; money sloshing, fiat money, SUV's, negative savings, the FEVER PITCH. All the discussions at this highly enlightened forum were brought into focus. It was a snapshot of a society gone mad. These people were willing to eat highly inflated $20 burgers then drive their gas guzzling monster trucks around the malls weaving in amongst themselves to spend a fiat night in their fiat world. It was truely frightening. I wish them luck. As we left 'fast-food-land' I recant second dialogue.

I said, " Let's get out of here, movie and relax dear?"

B.H., "Sure... can we stop at the movie store?"

"Ok....I'II bet you a buck you can't find one 'For Sale/For Rent' sign on any storefront"

I watched the scenery as we poked from stalled traffic light to the next. Strip mall after strip mall and not a single vacancy. Each and every store mulling with people
handing over their cash, no need to save, the economy is only onward and upward. It brought about another thought,
the system is 'maxed' out, this is the top. It was only a few years ago that the malls were empty and now they have built many, many more. When the music stops, this is going to be one scary looking mess, the ghost town of the '90's.

The movie store was packed, a line-up of 40 or more, every single person standing there looking mortified, the sheeple.
Nasdaq was way up and surely they added to their fiat nestegg but they didn't show any happiness, only sullen remorse of being caught in a system unconscious of it's ultimate outcome. I felt like running into the store and yelling to them, "Hey freaks ...let's go get a beer or 10,
buy some gold and talk about money, real money."

I said to the better half, "Let's go home watch some old re-runs, have a couple 'silly pops' and see what happens."

Upon arrival in the real world I noticed the kids playing hockey under a streetlight just a couple doors down from the house.

My son raced over to me and blurted, " Hey Dad,
get your stick, there's a major game going on!!"

As I walked over to the corner I could see the aura burning in the sky above the fiat hockey stadium only a mile away. The little streetlight flooding the real game seemed to be incredibly bright.
Canuck
(03/05/2000; 06:19:05 MDT - Msg ID: 26389)
Oil/Y2K
Excerpt from long (G.E) post:


-------------------------------
OT: The latest from RC.
(ScarletPimpernell) Mar 04, 20:02

RC's recent post on TB2000

"Several weeks ago I was hounded from this forum by certain gangster tactics of the Pollyanna "Gestapo" brigade. Why? Because, I persisted in the notion that Y2K was only just beginning and that my pre-rollover predictions might still be on target for the oil industry due to embeddeds problems."

-------------------------------------------

This man (RC) insists that Y2K is responsible, or at least to some degree, for recent oil prices. Is this verifiable?
His accusations are profound.
Dollar Bill
(03/05/2000; 06:23:54 MDT - Msg ID: 26390)
Canuk-oil y2k
While there might be a y2k issue, I suspect that the
oil price rise is due to the reason posted by ORO
on Friday.
It is a way to recycle a lot of the excess dollars
going out of the US at the rate of 25 billion a month.
Peter Asher
(03/05/2000; 10:29:19 MDT - Msg ID: 26391)
Hey Canuck, that was beautuful
I would love to see a "Better World" catagory in the halls for that kind of story.Thank you.
Peter Asher
(03/05/2000; 10:33:46 MDT - Msg ID: 26392)
This just in from Turbohawg

March 1, 2000

INTRODUCING LEGISLATION CALLING FOR THE
UNITED STATES TO WITHDRAW FROM THE
WORLD TRADE ORGANIZATION

------------

Statement of
HON. RON PAUL
OF TEXAS

[Page: H612]

Mr. PAUL. Mr. Speaker, I rise today to announce my introduction of and request cosponsors for a privileged
resolution to withdraw the United States from the World Trade Organization.

Last week, the Wall Street Journal reported that the United States was dealt a defeat in a tax dispute with the
European Union by an unelected board of international bureaucrats. It seems that, according to the WTO, $2.2
billion of United States tax reductions for American businesses violates WTO's rules and must be eliminated by
October 1 of this year.

Much could be said about the WTO's mistaken Orwellian notion that allowing citizens to retain the fruits of their
own labor constitutes subsidies and corporate welfare. However, we need not even reach the substance of this
particular dispute prior to asking, by what authority does the World Trade Organization assume jurisdiction over
the United States Federal tax policy? That is the question.

At last reading, the Constitution required that all appropriation bills originate in the House, and specified that only
Congress has the power to lay and collect taxes. Taxation without representation was a predominant reason for
America's fight for independence during the American Revolution. Yet, now we face an unconstitutional
delegation of taxing authority to an unelected body of international bureaucrats.

Let me assure Members that this Nation does not need yet another bureaucratic hurdle to tax reduction. Article
1, Section 8 of the United States Constitution reserves to Congress alone the authority for regulating foreign
commerce. According to Article II, section 2, it reserves to the Senate the sole power to ratify agreements,
namely, treaties, between the United States government and other governments.

We all saw the recent demonstrations at the World Trade Organization meetings in Seattle. Although many of
those folks who were protesting were indeed rallying against what they see as evils of free trade and capitalist
markets, the real problem when it comes to the World Trade Organization is not free trade. The World Trade
Organization is the furthest thing from free trade.

Instead, it is an egregious attack upon our national sovereignty, and this is the reason why we must vigorously
oppose it. No Nation can maintain its sovereignty if it surrenders its authority to an international collective. Since
sovereignty is linked so closely to freedom, our very notion of American liberty is at stake in this issue.

Let us face it, free trade means trade without interference from governmental or quasi-governmental agencies.
The World Trade Organization is a quasi-governmental agency, and hence, it is not accurate to describe it as a
vehicle of free trade. Let us call a spade a spade: the World Trade Organization is nothing other than a vehicle for
managed trade whereby the politically connected get the benefits of exercising their position as a preferred group;
preferred, that is, by the Washington and international political and bureaucratic establishments.

As a representative of the people of the 14th District of Texas and a Member of the United States Congress
sworn to uphold the Constitution of this country, it is not my business to tell other countries whether or not they
should be in the World Trade Organization. They can toss their own sovereignty out the window if they choose. I
cannot tell China or Britain or anybody else that they should or should not join the World Trade Organization.
That is not my constitutional role.

I can, however, say that the United States of America ought to withdraw its membership and funding from the
WTO immediately.

We need to better explain that the Founding Fathers believed that tariffs were meant to raise revenues, not to
erect trade barriers. American colonists even before the war for independence understood the difference.

When our Founding Fathers drafted the Constitution, they placed the treaty-making authority with the President
and the Senate, but the authority to regulate commerce with the House. The effects of this are obvious. The
Founders left us with a system that made no room for agreements regarding international trade; hence, our Nation
was to be governed not by protection, but rather, by market principles. Trade barriers were not to be erected,
period.

A revenue tariff was to be a major contributor to the U.S. Treasury, but only to fund the limited and
constitutionally authorized responsibilities of the Federal government. Thus, the tariff would be low.

The colonists and Founders clearly recognized that these are tariffs or taxes on American consumers, they are not
truly taxes on foreign corporations. This realization was made obvious by the British government's regulation of
trade with the colonies, but it is a realization that has apparently been lost by today's protectionists.

Simply, protectionists seem to fail even to realize that raising the tariff is a tax hike on the American people.



Canuck
(03/05/2000; 11:11:04 MDT - Msg ID: 26393)
@ Sir Asher
You are welcome.
Galearis
(03/05/2000; 11:24:12 MDT - Msg ID: 26394)
@Fever Pitch
It is not necessary to respond to this comment, but I wanted to add a little local area insight to your commentary about Ottawa and its citizens expenisively oblivious driving habits. While everyone and his uncle may have been lurking and troughing out at the Corel Centre yesterday in Ottawa, our observations on a little expedition to Toronto the same day drew some remarkably different observations. Gas prices in our area were running on average $.749 per litre and this was reflected in both traffic volumes both coming and going to the city. On our way back, I would estimate the volume down by 30%.

I also note that it is fashionable to SUV bash (I know this is an snide abstraction on the energy waste of driving these vehicles and agree to some extent), but I can also say that our Ford Explorer gets very close to 30 miles per gallon with careful driving. Many will differ I am sure, but it does underline the fact that some makes are neither as extravagant energy wasters as is seen by the general public, nor as useless as the "utility" in their name suggests. I cannot speak for GM products, however.

My trip was also not an extravagance as I made perhaps my last dirt-cheap silver bullion purchase of the year. (I also picked up a Birks Sterling trinket box - 8-1/2 oz troy
for $85CAN. The savings on what this box would go for on the market would pay for the gas.) Just out of interest for those who follow these things: I found a dealer who was liquidating 999 Ag one oz wafers for $8.50CAN each. Maple Leafs are now selling for $14.99CAN.

To keep on the gold topic. I also saw a Panda 1/10 gold coin selling for $120 set as a pendent in a flimsy 14K setting. I heroically reined in my enthusiasm for buying it.
((;^)
Peter Asher
(03/05/2000; 13:20:56 MDT - Msg ID: 26395)
Candidate ??
Turbohawg Dollar Bill, Journeyman, Marius ORO, 4Ducat Harley Davidson.
How about a "write-in" vote for Ron Paul

SLF
(03/05/2000; 15:25:32 MDT - Msg ID: 26396)
Question for Trail Guide/FOA
I believe January 1st 2001 is when all the countries in the EU are required to surrender their national currencies and trade in one single currency (Euro). In your oppinion, could the Euro take the place of the Dollar as the world reserve currency (on the scale that you speak of) prior to this taking place? If it can, could you explaine why?
Beowulf
(03/05/2000; 15:54:00 MDT - Msg ID: 26397)
China to Deregulate their Gold Market
http://www.kitco.com/_a/news/6070.htmState to loosen hold on gold
Source: China Daily

A senior gold industry official has confirmed that China's gold market will be deregulated within two years.

A gold exchange, expected to open in the near term in a city to be named, will be the first step of the deregulation, said Wang
Dexue, director-general of the Gold Administration under the State Economic and Trade Commission (SETC).

As a free market reform, deregulation is a set strategy, but a schedule for implementing a gold exchange awaits confirmation by the
central government.

Operation of the Huatong silver exchange in Shanghai, which Wang described as a success, is expected to speed up the
establishment of the gold exchange.

The silver market deregulation was widely viewed as a prelude to opening China's gold market.

Wang told Business Weekly gold market deregulation will stimulate the gold sector in China which is suffering from funding
shortages, especially in gold prospecting.

"With the country's financial reform deepening, the industry is losing government financial assistance," said Wang, who also serves
as president of the China National Gold Corporation.

The government invested only 100 million yuan (US$12 million) in the sector last year, compared with nearly 2 billion yuan (US$240
million) per year from 1988 to 1993. A special fund for prospecting will also be abolished next year, Wang said.

But the sector requires large amounts of money, and will need it to deal with challenges stemming from China's approaching
accession to the World Trade Organization, Wang said.

"The sector must explore more fund-raising channels including foreign investment," Wang said

The coming gold market deregulation will help the sector accelerate utilization of foreign investment, because the central
government's tight control of gold production and allocations will be relaxed, Wang said.

Foreign companies have been allowed to invest in the sector in line with interim provisions guiding foreign investment issued by the
SETC, the State Development and Planning Commission (SDPC), and the Ministry of Foreign Trade and Economic Co-operation.
But exclusively foreign-funded gold mines are still banned.

The SETC and SDPC are working out programmes to remove barriers to foreign investment in the sector and to allow risky
prospecting for gold resources using foreign investment.

Companies from the United States, Canada, Australia, Singapore and the Hong Kong Special Administrative Region intend to
co-operate with domestic gold miners in more than 10 projects.

The gold sector used little foreign investment under the tight control of the central government, Wang said.

Foreign companies were granted access to mines with lean and hard- smelted gold ores only after 1993, and the gold they produced
could not be sold abroad, which dampened their investment enthusiasm.

Publication date: Mar 05, 2000
Twice Discipled
(03/05/2000; 16:09:07 MDT - Msg ID: 26398)
WTO
I just sent this to almost everyone on my e-mail list and asked that they write their Rep and Senator. I then sat down and wrote a letter to my US Rep and Senator urging them to support this bill. I also suggested that they read the US Constitution and understand why they would support Rep. Ron Paul and H612.
Folks, while I think GATA is representing those of us in favor of Gold, we better send Washington our thoughts on issues like this also or GATA and GOLD will be outlawed by some non-elected world government body like WTO. National freedom FIRST, then financial freedom. Can't get #2 without #1.
WRITE YOUR CONGRESS PERSONS!
ced_s
(03/05/2000; 16:28:38 MDT - Msg ID: 26399)
Junior gold shares seem to have risen
Pilgrim reported on Gold Eagle @ 13:23 today that three junior mining shares moved significantly. Of course I will be watching this with interest, I happen to belong to one of them (BFM).
Saint Jude (SJD) and Battlefield Minerals (BFM) are on the Vancouver Exchange, Greystar (GSL) on the Toronto exchange.

GSL has been trading in the 45-65 Canadian cents traded as high as 92 cents Friday.

BFM trading in the range of 5-10 cents per share for several months went to 21 cents Friday.

SJD had bottomed out at 40 cents last December traded as high as 75 cents last week.

Could this be an indication of things to come, or mere speculative kiting? I preferr to think they are leading the other golds into a major conflict with the .COM's.
Dollar Bill
(03/05/2000; 16:48:43 MDT - Msg ID: 26400)
Ron Paul
Peter Asher,
Certainly that third party we have could use him for a
front runner.
That much brave contrarianism would face howls of derision,
but that would put those subjects on the table, which
would be interesting. I am uneducated on his subjects.
I'm sure he has validity.
Harley Davidson
(03/05/2000; 17:01:06 MDT - Msg ID: 26401)
@Peter Asher: Your Message ID:26395 Candidate??
I don't know a lot about Ron Paul but lately he certainly has been impressive. I hope he has aspirations to higher office because this country needs people like him - cut from the same cloth as the distinguished gentleman from North Carolina, Senator Jesse Helms.

I was watching Alan Keyes on C-Span on Saturday and he made some interesting statements which I will paraphrase:

No party has ever beat the incumbent in a presidential election during a time of economic prosperity. Keyes went on to say the only way Al Gore could possibly be defeated would be for the Republican nominee to convince the country of the complete lack of morality and integrity of the Presidency over the last eight years, of which Al Gore was a part, and the need for a change. So if G. W. Bush gets the Republican nomination, Al Gore will be the next president of the United States simply because the only candidate who could/would articulate the morality/ethical/integrity issue is Alan Keyes and I think he is correct. Here is a scary thought...if Alan Keyes doesn't get the nomination (and he currently has about 5% of the vote), Al Gore is going to be the next president of the United States. God help us.

Something better happen soon or the Father of the Internet, is going be handing this country over to the Chinese on a cash and carry basis.

I could really get excited about a Keyes/Paul ticket!!!


ji
(03/05/2000; 17:51:23 MDT - Msg ID: 26402)
Ron Paul
http://www.house.gov/paul/openingpage.htmRon Paul's web site.
RossL
(03/05/2000; 17:56:21 MDT - Msg ID: 26403)
Dr. Ron Paul
http://www.house.gov/paul/openingpage.htmDr. Paul has already run for president once. In 1988 he was the presidential candidate for the Libertarian Party. That was the year that I signed "the pledge", joined the libertarians, and voted for Dr. Ron Paul for president.
R Powell
(03/05/2000; 17:58:17 MDT - Msg ID: 26404)
Gold $ Price in Sydney
Kitco's charts are not always correct. I certainly hope the Bid $256.30 it's showing now is wrong. The ask price is $289.30 so maybe someONE is bidding low and the other traders downunder are still drinking their morning coffee.
Zenidea
(03/05/2000; 18:02:59 MDT - Msg ID: 26405)
Having to reach up to touch bottom !!
Wow, Kitco is telling me Au at $256.30 and silver at
$5.09 !!
R Powell
(03/05/2000; 18:13:34 MDT - Msg ID: 26406)
Silver's hot downunder!
God bless those good fellows downunder. The bid price of silver is $5.08 but the asking price is $39.08!!! They certainly appreciate their silver in Sydney. Again, these fiqures are from Kitco and are obviously wrong.
Canuck
(03/05/2000; 18:19:52 MDT - Msg ID: 26407)
Martian CB's to sell 3,000 tonnes tomorrow.
http://www.crbindex.com/curquote/crbquote.mhtmlGold not at $256.

See 'link'. March 5 20:14pm : $290 and change.
Zenidea
(03/05/2000; 18:33:37 MDT - Msg ID: 26408)
Who are Kitco's ( Believed reliable sourses)
Have another cuppa ! ( believed reliable disclaimer ), hehe.
jdoubleu
(03/05/2000; 18:49:29 MDT - Msg ID: 26409)
Canuck Msg #26388 & #26389 Peter Asher #26392
I too really enjoyed the 'road hockey' event. There just can't be better fun (You have to take into account my advancing age). Thank you for sharing.

As to Scarlet P. post @ G.E. I would suggest he is way out there as far as any Y2K 'downhole' problems. I have nearly completed my third decade in the 'patch' and can state the vast majority of the downhole PRODUCTION equipment has zero embedded chips in them. Now the directional drilling stuff, wireline equipment & some other exotic stuff does contain some of these chips I'm sure but I haven't seen anything to indicate any Y2K problems thus far and have heard no talk of any potential problems in the future. Some of my cohorts in the processing/pipeline side of the industry are reportedly going to be nervous for a bit yet but again I haven't directly heard of any substantial problems from Y2K.
------------------------------------------------------------
Peter Asher

I too like some of the things Ron Paul has been saying. I believe he may be a sincere fellow looking to do the best he can for his constituents. Although I believe the WTO is a good thing too much power corrupts so if he postures a little and brings them down a notch great. There is always some danger of a politician getting caught up in his own rhetoric but from what I have heard he sounds like both his feet are solidly on terra firma.

jdoub
Elwood
(03/05/2000; 18:57:41 MDT - Msg ID: 26410)
To Trail Guide (03/04/00; 15:47:23MDT - Msg ID:26368)

You state:
Here we are with a currency that's been in it's most recent extended inflation for 15+ years and almost no statistics show "major" price rises yet. Considering the overall world-wide expansion of dollar assets during this period, we would think 15% price increases would have already been the norm for several years. Along with seeing 15% interest rates. Clearly this is not the case as somewhere, someone has been buying up our expanded dollar assets and holding them in support of the dollar system. This portion simply cannot be held as an investment, because one must eventually buy something here to gain from it.

I reply:
As a reader of Mises you should understand that this is only part of the picture. The generally-accepted measures of rising prices are inadequate especially during periods such as we've seen of wide-spread technological advance. These advances serve to increase our productivity such that we've been able to reduce the inputs needed for a given level of output.

Granted the productivity measures we use are just as inadequate as the inflation measures. We know they exist, however, because, by deduction, businesses and entrepreneurs would not be using these techniques if they weren't better than the techniques used before they were employed.

The effect of these technological advances are to reduce our costs of production, and, in a market economy, would lead to falling prices rather than stable or slightly increasing prices. Therefore, once the boom comes to an end the deflationary pressures will push the prices lower than previously measured inflation statistics indicated. I believe this is what happened during the bust of the 1930's.

The fact that our "overall level of prices" has not been allowed to fall as it would in a true market economy represents de facto rising prices due to inflation that could never be measured by any government statistic. This is the old "what is seen" vs. "what is not seen" from Frederick Bastiat. It's my understanding that the European economies suffer from the same condition.

Regards,
Elwood

CoinGuy
(03/05/2000; 19:38:06 MDT - Msg ID: 26411)
KITCO
Kitco is showing Gold bid @ 256.50 down 31.80. I hope this is an error!

Coinguy
THX-1138
(03/05/2000; 19:39:11 MDT - Msg ID: 26412)
Reply to Harley Davidson
I have always believed for Alan Keyes to win the presidencial nomination the Stock Market would have to crash.

Then people would be crying to the government to get rid of the IRS and Income Tax because most would have gone broke and have no money to pay any taxes, let alone have them taken out of their paychecks.

Of course, there are always the bleeding heart commy liberals who would want the Gov't to bail out all their mistakes.

Peter Asher
(03/05/2000; 19:47:47 MDT - Msg ID: 26413)
POS
http://news.excite.com/news/r/000305/21/minerals-forecastThis may be what's causing the price of silver to weaken. The expectation of increased supply due to expanded base metal mining activity

"With demand for metals such as nickel, copper and zinc
increasing as countries pull out of the economic malaise of
the late 1990s, the next few years will see demand outstrip
growth in some segments of the base metals market, they
said."
CoinGuy
(03/05/2000; 19:53:51 MDT - Msg ID: 26414)
Can anyone confirm spot bid on GOLD
I've seen it plummet on KITCO. Anyone confirm?

Coinguy
NORTH OF 49
(03/05/2000; 20:00:42 MDT - Msg ID: 26415)
Easy does'r there COOIBGUY
http://www.mrci.com/qpnight.htmIt's just the usual Kitco GIGO. April @290.96 + .60

No49
CoinGuy
(03/05/2000; 20:01:09 MDT - Msg ID: 26416)
Thanks Canuck
Canuck,

I thank you for the link to another site(Finally got smart and scrolled down). Kitco is screwy, I AM not going over their again for any information.

Coinguy
NORTH OF 49
(03/05/2000; 20:03:45 MDT - Msg ID: 26417)
Sorry--Ihave NO idea how "CoinGuy" wound up--whatever it was on my last post!!
No49
tedw
(03/05/2000; 20:05:18 MDT - Msg ID: 26418)
test
http://www.usagold.comtest
DAYOOPER
(03/05/2000; 20:28:32 MDT - Msg ID: 26419)
ANOTHER COMMODITY SITE (GOLD INCLUDED)
http://www.ancofutures.com/quotes.htmFOR THOSE THAT ARE INTERESTED.

DAYOOPER
Chris Powell
(03/05/2000; 20:48:08 MDT - Msg ID: 26420)
BBC warns of something wrong in gold market
http://www.egroups.com/group/gata/402.html?To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
Dollar Bill
(03/05/2000; 21:25:08 MDT - Msg ID: 26421)
Chris Powell
That Gata would provide a link to the writings of Rodney Smith leaves me wondering why they ignore the threat that thier actions carry. Writing to congressmen is sophmoric.
If it is truly the case that the gold derivitive market could be tidied up with just a conference call, then why the
worries mentioned in the article?
The interest rate derivitives and Greenspans catering to them is perhaps the true cause of the credit bubble that is so stupendous and so completely out of anyones control.

Here is an excerpt from the 1994 Fed meeting transcripts released on March 1 of this year.
This is Greenspan talking about a recent(94) interest rate rise. "When we movedon feb.4, I think our expectation was that we would prick the bubble in the equity markets. What has in fact occured is that...while the stock market went down aftere our actions, it went down marginally on net over this period"
If we were dealing strictly with the economic outlook as it stands now, there is no doubt in my mind that this economy could absorb a very large increase in interest rates without a problem. the difficulty I have is that i dont think the financial system can handle a very large increase without a break in it's tensile strength...It's a risk, frankly, that I think we should be quite concerned about."
(Ithink "tensile strength"=interest rate derivitive market)

Well, Mr. Greenspan, the nasdaq was at 800 in 94 and is now 4,800.....amex WAS 100, Now 740....philidelphia semiconductor index WAS 100, Now 1172....S&P WAS 450, Now 1380...not to mention internet and telecommunication manias...Financial borrowings WERE 3,8 trillion, Now 7.5 trillion....non-financial debt has increased by 4.5 trillion...If greenspan WAS worried about financial fragility and stock prices THEN, he must be absolutely terrified today. What a fiasco.

Thanks to David Tice for his writings.
Dollar Bill
(03/05/2000; 21:38:08 MDT - Msg ID: 26422)
writing
Sorry to do double posts.
I didnt mean to type that comment about writing to congressman. I just meant that they have no power over the real powers of money and so I view it as a waste of time.
Might as well alert the PTO as far as how much it will help.
On THIS issue.
Mr Gresham
(03/05/2000; 22:10:35 MDT - Msg ID: 26423)
Oro quoted over at Longwaves
http://csf.colorado.edu/forums/longwaves/mar00/msg00194.htmlDidn't have time yet to read any commentary by them or explore their forum either...
Journeyman
(03/05/2000; 22:12:56 MDT - Msg ID: 26424)
IMF to help US - - - NOT!!!!

The BBC article cited by GATA suggesting the IMF is "the only international institution that may still be
able to help" if the financial tidal wave hits the U.S. Sorry, but the IMF and the US together couldn't even help Brazil in any significant way because of the amount of money necessary. Brazil's economy is big, but, well, let's just say it's not quite as big as the US economy.

When the tidal wave hits, NOTHING is big enough to help.

Regards,
Journeyman
Dollar Bill
(03/05/2000; 23:31:28 MDT - Msg ID: 26425)
Gonespan
I predict greenspan will kick the bucket in office.
He must be so stressed. The stoic front is such a facade.
The russian threat receded in the eighties. The euro was a distant dream.
There was no essential reason for greenspan to just hand control over credit creation to.....well, EVERYBODY and lie about new economy/new paradim shifts. Economic historians will talk about this time period forever...... When they finally catch thier breath.
TEX
(03/06/2000; 01:15:03 MDT - Msg ID: 26426)
Sight For Really Sore Eyes!
Jeez............I gotta quit lookin at the KITCO chart each night just before I hit the sack! I really do hope its one of those usual Kitco chart freak outs.....if not, I don't want to get out of bed this morning. YIKES!View Yesterday's Discussion.

Goldsun
(03/06/2000; 03:10:22 MDT - Msg ID: 26427)
Shifty Paradigms and Revolting Scientists
Although Kuhn did not give us paradigm, he was the first to make one shift.
According to my OED, the first known use of paradigm occurred in 1483 in a book titled "The golden legende". Several amazon.com reviews of "The Structure of Scientific Revolutions" mention it as the origin of paradigm shift. Many years and miles have passed since I read Scientific Revolutions, but I recall finding it well worthwhile.
Goldsun
Canuck
(03/06/2000; 04:54:04 MDT - Msg ID: 26428)
Fort Knox
http://www.iol.co.za/news/bus_newsview.php3?click_id=81&art_id=ct20000305212227424K523182&set_id=1All the gold is in Fort Knox....but....no one has been in the vault to check. (Last audit in 1950)
SteveH
(03/06/2000; 06:05:06 MDT - Msg ID: 26429)
Heard on the grape vine that...
some US oil equipment companies are investing their cash in the stock market while they await contract expiration with Saudi oil interests. In other words, some of these companies are investing in stocks instead of US produced oil!

A major car company is investing in an IPO with a company that will theoretically pay for a 350 million dollar program to buy computers for all Ford employees. In six months when the IPO price rises and they can cash out their position they will have paid off the computers. Hmm?
nickel62
(03/06/2000; 06:39:07 MDT - Msg ID: 26430)
Kitco gone CRAZY ??? I hope so !
The Kitco chart is showing gold bid in NY at $256 ???? Anybody else wondering what is happening?
silent runner
(03/06/2000; 06:48:15 MDT - Msg ID: 26431)
gold fields ltd
would like to buy some stock, does anyone have a contact # or an e-mail. thanks ahead of time.
elevator guy
(03/06/2000; 08:05:15 MDT - Msg ID: 26432)
Kitco bid price! $256! Ha, thats a laugh!
Serves to demoralize gold bugs.

Next we will be told that we should just throw gold out in the street, mix it with asphalt, cause its so worthless.

Dont buy paper on the dips, cause its a shell game, but we can see the ball roll from cup to cup now, with our gold glasses on. The shell game is losing its appeal, and as Trail Guide says, the paper price will be discounted to bring in fresh meat, but it s unredeemable, so why play?

Buy physical for peace of mind, and security
USAGOLD
(03/06/2000; 08:16:44 MDT - Msg ID: 26433)
Today's Gold Report: Warburg Says Gold Will Average $315
http://www.usagold.com/Order_Form.html3/6/00 Indications
�Current
�Change
Gold
289.00
+.20
Silver
5.12
-.03
Gold Lease Rate
0.5700%
nc
Gold Comex Stocks
1,373,896
nc


Market Report (3/6/00): Gold started the week on a quiet note. There
was little or no reaction to the news that China will deregulate its
gold market. With the start-up date two years out traders basically
viewed the announcement as a non-event. Likewise, the market took in
stride the British announcement over the weekend that it would continue
its gold auction strateg. The market was experiencing "good physical
demand" according to one London trader. On a bullish note for gold, John
Reade at Warburg Dillon Read, the old-line banking house, forecasted a
300 ton deficit between gold supply and demand and predicted the price
would average $315 an ounce, up from its $300 forecast earlier in the
year. As we go to fetch this over to the server, the dollar is getting
beat up on the forex markets, the Dow is wavering and crude oil (Apr) is
making an attempt at breaking the $32 barrier. Upcoming we have Alan
Greenspan delivering a speech at Boston College today, tomorrow we have
oil stock levels will be made public and money supply figures come out
on Thursday. We could get some surprises. The oil stock number could be
especially interesting with shortages and price rises becoming standard
fare in the energy sector. Reuters is reporting this morning that the
battle over who will head up the International Monetary Fund continued
unabated over th weekend. The wrangling over who will head-up IMF
demonstrates all too clearly the split between continental Europe and
the United States on the future direction of IMF. The United States is
opposed to the European candidate backed by Germany -- Caio Koch-Weser
-- saying he doesn't have the political clout to deal with the sensitive
issues IMF faces particularly in Russia and Asia. Europe disagrees.

That's it for today, fellow goldmeisters. See you here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click herelink above and make the appropriate entries.
Journeyman
(03/06/2000; 08:31:30 MDT - Msg ID: 26434)
Protecting gold: Any news on the Emerson case? @SteveH

Hello Mr. H.,

Heading says it all!

Regards,
Journeyman

Dollar Bill
(03/06/2000; 08:51:38 MDT - Msg ID: 26435)
The Great Inflationist Greenspan turns 74 Today.
A few birthday salutes for Rip Van Greenspan.

"Irredemable paper money has almost invariably proved a curse to the country employing it." Irving Fisher 1911
"There is no surer means of overturning the existing basis of society than to debauch the currency." J.M.Keynes
"The reckless policy of benign neglect for the stability of the US financial system that is now the hallmark of the greenspan fed, should be recognised as nothing but an unmitigated disaster. Wall Street has assumed the reins of maney and credit creation-the lunatics now are running the asylum." Doug Noland 2000
In the 1700's John Law's monetary regime in France had inadequate safegaurds against over-issueance of money. As rampant money supply expansion and a self-feeding stock market advance, stoked public confidence, Law completely lost control of his monetary system to the bubble mania.
Indeed it took only a brief period of time for uncontrolled credit issuance combined with a stock market bubble to completely destroy his system. In the first place, the essence of Law's scheme was his proposal for the monetization of certain existing assets. We strongly argue that the monetization of existing assets, largely real estate and stocks, is the essence of the Greenspan boom.
This prosperity is not about productivity, but about unprecedented asset inflation. It is furthermore our strong contention that a monetary system dominated by asset monetization, inconjunction with Federal Reserve policy accomodating unlimited money supply expansion, is an absolute recipe for disaster. In fact, it is a senseless replay of John Law's fiasco.
A full fledged mania has been allowed to develop and is now an uncontrolable monster. This is a tragedy that should never have happened." Noland, Tice, Vickers. 3/1/00

If there are any forum readers looking for a growth industry to invest in or run as thier company, might I suggest debt collection? The new bancruptcy law about to be passed will close that escape door for most people and the credit bubble aftermath will make debt collection the industry of the future. I will make a business plan for that available in some future post.
Happy Birthday greenspan, the debt collection industry salutes you. bill burke

Just to put the icing on the cake, here is greenspan himself: "The difficulty is in defining what part of our liquidity structure is truly money" Greenspan 2000
To which Tice responds: "shame on you"
ORO
(03/06/2000; 09:59:34 MDT - Msg ID: 26436)
Journeyman - 18% production and the future
Drucker and Ohmae are both pointing out the same things in this regard. There is a transition in marginal values of farming, production, service and intellectual products.

The first loaf of bread is satisfies hunger. The second will be eaten only in part and the rest fed to the goats. The third is fed to the cows and some is given away. The fourth is simply not worth producing.

As technology develops, more can be produced from the same resources, and more resources become available. The productivity of farmers has grown tremendously. Indeed, so much so that farms were deserted or sold to large corporate farms because fewer farmers could satisfy all the paying demand. Needless to say, the efficiency of farmers was so great that the few remaining farmers could produce much more than their predecessors who were half the population.

Industry undergoes the same process, as more can be produced with fewer people. The farmers turned to production people. As production increased in efficiency, production workers were freed up to do other things - R&D, marketing, PR, trading etc.. Entertainment was also expanded in this process, as prices per hour's popular entertainment fell with higher efficiency delivery through recordings and broadcast (mass media).

As technology has come to increase the efficiency of its own creation, the values that remain at high marginal value are rarities, fresh technology ideas, creation in the arts, and most of all - judgement - a.k.a. business decisions.

However, the transition was greatly accelerated in the US because the dollar reserve and settlement systems acted as a substitute for productivity gains in the manufacturing and resource sectors, thus we have arrived at the future unprepared and without the requisite capacities in the industrial sector. While software, hardware, design, marketing and research done for foreign industry were booming tremendously up till 1997, these are still quite small relative to the general economy. What is more important in these sectors, is that the expertise dissipates as the industries move overseas more completely.

I have documented the effects of the dollar and international trade on the productivity numbers - particularly the fact of the movement of cutting edge production overseas. The movement of semiconductor and circuit board manufacturing to Taiwan, Korea and Singapore over the past 5 years has completely erased any apparent productivity enhancement in US manufacturing of these products.

Where is there a change in productivity? Where is the change in the way of doing business? There is a tremendous change in productivity of interbusiness contracting and supply chain integration. Though management has improved its productivity mostly in the 1986-1994 periods, but has slowed this to a crawl in recent years. The move from negotiated supply contracts to exchange based real time supply contract allocation commoditizes industrial products and industrial production itself. Electronic product assembly is now a service business with a commodity style bidding process. That puts design and marketing at the top of the list of factors determining sales and providing margins. These activities have increased in productivity during the 80s, and are now "stuck" with incremental gains. Production has not increased in productivity noticeably, some research indicates that it has dropped slightly.

The exchange system now growing into dominance in a just in time inventory management environment is the main source of increased productivity within the US. Most of these improvements are not exactly what is normally referred to as productivity. Rather than changes in output per hour worked, there is a change in the inventory to sales figure - which has dropped persistently since the late 70s. The number of different products and variants has grown, but the worker time going into them has increased or stayed the same - not decreased. On the corporate purchasing and sales side we have seen substantial improvements, everything else in the chain from supplier to customer has remained the same. The one great difference is in the time that products spend in warehouses and the reduction in the number of warehouse workers moving those products around.

One might think that secretarial work has improved with the advent of spell checkers and form letters, and electronic filing, but it hasn't. Secretaries now routinely cycle business letters through corrections 40 times before these leave the office. Electronic files double up with paper files, increasing secretarial workloads. Sales-people sell a wider variety of products each, but have not improved as much on their volume where automated ordering and bidding is not used.

Much of the change in inventory efficiency is not reflected in inventory figures because the figures are skewed by the increase in the number of product variants replacing volumes of products in inventory for each variant. However, these changes have not increased the productivity of the whole economy greatly, what has increased it is the rise in the level of assembly - no more subassembly and multioperational shaping is done in the US. Today's US worker deals with final assembly of imported sub-assemblies. Fully automated production of parts is still done within the US, however, the manual work is sent out to Mexico and other countries and returns for final assembly or packaging here. The number of operations per hour worked has not increased, just the number of sub-components within the assemblies in each operation increased. Also, the general transition from product manufacture to product handling has made apparent productivity increase as imports have expanded.

The exchange model for inter-business contracting is only now gaining sufficiently in market share to be a major component in productivity improvement, but it has limits and does not change productivity anywhere near as much as has the transition to imports.

The squeaky cog gets the oil. The area where bottlenecks are greatest gets the most attention by business. As these bottlenecks are declogged, the remaining parts of the production and supply chain - the efficient operations -often languish from lack of capital, since improvements there are slower than in those areas where current inefficiency makes the value of a problem's solution greater. Those relatively efficient areas eventually become the limiters to expansion of volume and variation.

The most problematic area is in natural resources. Particularly in minerals. Exploration technologies and automation were much improved from the 70s into the 80s as were competing recycling operations for some minerals - iron and aluminum in particular. They are nearly at the level of automation of a chemical plant. Recycling has lowered the prices for competing new minerals, leading to slower growth in capacities. However, longer lifespans of many material intensive products (e.g. cars) have extended to the point of lowering the annual supply of material for recycling and raising the amount of fresh minerals needed for additional increases in product volume. Any additional expansion of product volumes will require greater output from this sector.

The currrent bottlenecks in supply chain contracting and retailing, which were the most inefficient and highest cost component of any operation till recently, are droppping away, thus allowing greater consumer purchasing power in terms of volumes. Though many products have lowered their marginal values because of their being replacements for consumers in industrialized countries, new features and expanding markets in the developing world are creating additional demand that was not met because of the costs of retailing, contracting, delivery, and inventory management. The new technologies' effect in lowering the latter costs has been steadilly shifting the bottlenecks to the raw materials sectors. This process will accelerate greatly as the exchange model gains use in business. A boom in natural resources will arrive soon. What we have seen in oil is just the slightest example of what can happen (though OPEC did not wait for the demand side of the equation to steady but limited supply).

Since lead times in the mineral resource sector are so long, the ongoing shift in bottlenecks from the product handling and contracting area to the resource area is going to take much longer to resolve. The longest lead times are in exploration, often up to the 5-7 year range. Next up are lead times for capital installations and for worker preparation which can take from 1-2 years to 3-4 years. Furthermore, the movement in prices of commodities is met with skepticism by market participants who expect a pull back in prices when the first new installation is put in place. This pushes forward responses to the information on the supply-demand balance that higher prices indicate. It has been a year since oil prices started rising. There is yet to be any major response in enlargement of exploration budgets.

During the last 20 years, inventory has been reduced to a single production cycle's supply. Though actual business conditions along the supply chain were making lesser inventory levels necessary, there was a strong monetary balance driving this trend as well. This was because of the interest rates being well above 0 in monetary balance terms - meaning that central banks have kept interest rates high enough so that there has been a deficit in the creation of new dollars relative to their demand for the purpose of interest payments. As a result of this, inventories that had been a profit center during the 70s were causing losses because of the interest payments on the working capital loans the inventory required.

As inventories were dumped into the markets at a steady pace in the industrialized economies, commodity prices were falling or maintaining their levels. Furthermore, many of the resource rich countries were heavilly indebted during the monetary surplus periods of the late 70s and were caught in debt traps which forced them to sell their production to raise funds to pay interest due on their debt. This pressure distorted the global economic system so badly so as to put the industrial countries currencies - which were hooked up to the dollar - at levels of overvaluation seldom seen in history. Definitely not since just before the 1970 break into controlled monetary chaos.

The improvement of the current accounts of the resource and industry heavy developing nations has been rapid and steady since the 1997-8 crash in their economies. History shows a strong correlation between these countries' positive trade balances and high dollar price inflation. This is because in their efforts to repay debt, these countries' industries obtain vast cash balances that are in excess of what they need to repay the debts. Theeir experiences of the recent past would have them unprepared to go into debt once again, and they simply let go of excess cash balances to finance business expansion rather than do so out of debt. Thus the cash accumulated has no demand associated with it within the country's businesses. The resulting cash flows remain in the markets with no debt repayment demand associated with them from outside the country of issue (the US).

The next item to speak of is that of the bloom of variety. The tailoring of products to consumer needs has been the major driver for business advantage. Not cost reduction. That is the "New Paradigm" of the 80s and 90s in the industrialized countries. The complexity of logistics that current consumer expectations demand from their suppliers was not possible in 1980, but has been the leading driving force for making a sale since then. The sales floor of insurance companies have not shrunk as the accounting pools of the 50s disappeared in the 60s as computers raised the productivity of accountants. Instead, the computer on every desk is used to customize the insurance company's product. Many of the intermediaries that used to do the customization (your friendly insurance agent) for higher end clients will be driven out of business. However, the customization will now be available to lower end clients as well as it was available before to the higher end clients for a goodly fee.

Thus, the productivity we measure is not what we think it is. It is not improvement in the output per hour, but the import of foreign output at reduced prices coupled with an efficient (rather than productive - in the traditional sense) retailing, inventory and contracting system. The force driving this is a short squeeze on the dollar debtors and the technology that is eliminating the Chen-Woods effect. The Chen-Woods effect essentially says that because retailing and distribution are far less efficient than production, GDP accounts can show an increase as imports grow, as a result of gross margins within an importing country being greater than the cost of the imported item. As the retailing and distribution system grow in efficiency through the use of internet and other technologies that enhance reaction speed and reduce retailing and distribution costs, their portion of the final cost to consumers will fall below the 50% mark and lead to GDP figures showing a decrease with importation rather than an increase. I venture to guess that we are nearing that point and will certainly reach it within the next 2 years.

Finally, the current advances have made an impact on productivity in manufacturing. They have decreased it. What has improved is distribution, selection, timeliness, and lesser consumer inputs. One good example is the incredible availabilityof books on the net. Books once found only in the largest or the most specialized collections are now available on the net through new and used book retailer networks. The paid labor involved is greater than that of a sale in a bookstore, however, the consumer is saved browsing time, the drive to and from the store, and the multiple phone calls and searches among stacks of books that leave one empty handed. Though the single book was handled by many more hands, the total inputs required by consumer, retailer and producer have been reduced tremendously, but mainly on the consumer's part, significantly on the retailer's part, and not at all - or very slightly - for the US producer.

High Flier
(03/06/2000; 10:09:55 MDT - Msg ID: 26437)
Test
Test...
SteveH
(03/06/2000; 12:20:49 MDT - Msg ID: 26438)
Emerson
Journeyman,

Key Cases in Second Amendment history (some):

Presser v. Illinois
US v. Emerson
US v. Miller
US v. Verduigo-Urquidez


Here is latest on Emerson:

Docket Text



02/22/00 Joint motion filed by Appellee Timothy Joe Emerson in
99-10331, Amicus Curiae St of AL in 99-10331, Appellee
Timothy Joe Emerson in 99-10499, Amicus Curiae St of AL in
99-10499 for 30 minutes of oral argument [1548173-1], to
allow the amicus curiae, State of Alabama, to participate in
oral argument for a period of 10 minutes taken from the
total time allotted to appellee. [1548173-2] Excess Pages?
(Y/N) N. [99-10331, 99-10499]


The Emerson amended opinion is a great read. See www.saf.org
nickel62
(03/06/2000; 12:59:53 MDT - Msg ID: 26439)
ORO thanks for all the time you spend on these wonderful posts.
I am half way through your last one and have learned a great deal. Thanks for the effort it is appreciated. I am going back to finish.
nickel62
(03/06/2000; 13:16:32 MDT - Msg ID: 26440)
For what it is worth I am now routinely seeing signs that inflation is becoming more
widespread. I have seen numerous products be downsized at the same price. Where the 28 ounce of Heinz catsup is reintroduced as the 24 ounce bottle at the same price of course and the soup cans from Campbell have been shrinking as well. This is a game I haven't really seen since the 1970s and is getting more and more widespread. Meanwhile at Walmart the prices are generally rising not falling anymore. Part of this is a harvest strategy having driven most of their competition out of business they can fairly safely raise prices on many items. They are doing this in so many areas that where two years ago in Maryland they were always the lowest on almost everything. Now they are the price leader on less than ten percent of the items I regularly buy. It is hardly worth the extra miles to drive there.Sam Walton would be spinning in his grave. Of course gasoline and home heating oil have exploded in everybodies budget but the interesting thing is to watch as the middle men try and pass this along. Prices at restaurants are rising where they can and many mall outlets where they think they have the strength to get away with it are trying to make bigger margins stick. Teen girl clothing and kids impulse buys in sport ware and equipment are rising when the competition allows. Othere who see specific items being raised please contribute your insights so we can accurately measure the debasement of the US dollar before it dawns on our stock entranced brethern.
MarkeTalk
(03/06/2000; 13:17:29 MDT - Msg ID: 26441)
Bundesbank warns of U.S. stock market crash
http://cbs.marketwatch.com/archive/20000224/news/current/erdman.htx?source=htx/http2_mwDoes the German central bank (Bundesbank) know something that Alan Greenspan and the Fed don't? Or perhaps Greenspan knows but is choosing the route of ever-increasing interest rate hikes in order to deflate the stock market bubble and thereby hopefully avoid a market crash. Technical indicators from several (so far) reliable sources indicate that the month of March will be the turning point for stocks. Watch market action around the Ides (the 15th) as well as at the end (after the 27th). Gold should respond with a huge rally. Just remember Friday, Feb. 4th when gold jumped $23 in a single day.
MarkeTalk
(03/06/2000; 13:35:30 MDT - Msg ID: 26442)
Possible gold move on Taiwanese independence
http://news.excite.com/news/r/000306/01/taiwan-election-chinaHow many people remember what gold and silver did when Chinese authorities crushed the student rebellion at Tiamenen Square in the late 1980s? The upcoming presidential election on March 18th (note the proximity to the 15th) could set the stage for a repeat performance if Taiwan votes in pro-independence candidates and Bejing makes good on its threats.
Henri
(03/06/2000; 13:51:37 MDT - Msg ID: 26443)
OT Trail Guide..."Walking" as described by Henry David Thoreau (1862)
This short essay should be a pleasure to those who can find it. Thoreau speaks of the chivalrous nature of "walkers" and describes them as knights of a new/old order...the "fourth guard" "...outside Church and State and people." "It requires a direct dispensation from Heaven to become a walker. Ambulator nascitur, non fit."
Dollar Bill
(03/06/2000; 14:05:24 MDT - Msg ID: 26444)
Marketalk
Hi Marketalk,
Paul Erdman is a comedian.
"Alan, stick with what you know best. If your principle aim is to contain inflation, you might want to consider paying more attention to the money supply."
He cant possibly pay more attention to the money supply.
He has nothing to do with it at this point. All he can do is ask the Saudi's to raise the price of oil for a couple years to drain off our money. Hitting the small guy as usual. February was the hottest auto month since fall 1986.
The natural gas industry will have a lot of sales as soon as people realize that this oil price rise is not temporary.
The birthday cake for allen is rising in the oven.
And back at the fed job, the numbers pour in showing that the credit bubble is rising in the supercharged money oven.
The german CB is hardly playing mr helpful to the american people. They have thier own agenda. It is the euro as the reserve currency. They LOVE our current account deficit. Thier own economy needs our purchases to stimulate buying by all the other countries of the world. They know Greenspan cant do anything. They are fighting with greenspan and summers about the new IMF head and thier helpful comments are just part of the battle. Summers has the Germans over the barrel at this point and they dont like it. They tax the hell out of thier people and businesses. They are hardly a shining citadel of financial utopia.
Farfel
(03/06/2000; 14:31:03 MDT - Msg ID: 26445)
SELL BARRICK GOLD!
Another dismal day for gold but here's the good news...

BARRICK GOLD SET A NEW LOW!!

Keep selling this scam company into the ground.

Thanks

F*
TheStranger
(03/06/2000; 15:13:25 MDT - Msg ID: 26446)
Inflation Update
From today's Wall Street Journal, page A2:

The supply of available homes has fallen to a record low, prices are
escalating, and buyers are forgoing the customary practices associated with
buying a home -- including having it checked out by an engineer -- to
entice sellers to accept their bids. Among the worst markets: New York,
Washington, Boston and parts of California, Florida and the Midwest.

"We've not seen any sense of demand slowing," says Larry Brackett, a
broker in the San Francisco Bay area. As for rising mortgage rates, "it's
like people don't care."

Strangers Note: According to the article, the slowing in new home sales lately has been due to shrinking supply and not lack of demand.
Usul
(03/06/2000; 15:19:04 MDT - Msg ID: 26447)
Erdman's Books
One problem with discussing Erdman's books is that they seem
to bring out the worst in people. Either they hate them -
regard them as a "sterile" investment that does nothing of
benefit, or they see Erdman's books as containing clues
which will solve all of mankind's problems...

It is left unsaid that a return of Erdman's books to the
market might have also solved a lot of the goldbug's
personal financial problems if, during the past decade, a
new dollar link with Erdman's books had been established at,
say, $5 a book, or even $3.

All one can say to them today is: Dream on. But it will
never happen. Recently at the charity shop
in London the price of "The Crash of '79" was set at 30
new pence Sterling, down about 70 percent [but this
excludes all inflation since 1977!], and at its lowest
level since 1977.. And "The Panic of '89", down to 45 pence
from its 1987 price of $4.50..

And not forgetting "The Last Days of America" now priced at
50 pence, even in hardback.

Why? Because Erdman's books are being remaindered and the
process is irreversible. The stark facts bear this out.
The Bookshop of England is going to sell 415 tons of Erdman
Books, or more than half of its book reserves. This means
that England, which invented the bookshop in the 19th
century, is now getting out of the Erdman book business...

Switzerland, traditionally a nation of bookbugs, is doing
the same. Last April the Swiss voted to sever the official
link between Erdman and the Swiss bookshop. The Swiss
National Bookshop intends to dump 500 of its 1,300 volumes
of Erdman books to finance its "Solidarity Fund.", with the
rest to follow later. According to the President of
Switzerland's central bookshop: "Erdman's books are no
longer of any monetary importance."

The International Book Fund plans to sell between five and
ten million Erdman books to relieve the debt burdens of the
world's poorest nations. In this it has the full support of
France, Germany and Japan - the remaining key holders of
Erdman books as part of their literary reserves.

So now Erdman books are just another commodity. As is
"The Billion Dollar Killing". Its price dropped
below 41 pence last year, no doubt affected by what was
happening to the stock market. From now on, the prices of
these books will be set by charity shops in the pits of the
world's cities such as London, Chicago or New York.

How the mighty books have fallen.

Economist and author Paul E. Erdman is a columnist for CBS
MarketWatch.
Trail Guide
(03/06/2000; 15:34:02 MDT - Msg ID: 26448)
(No Subject)
elevator guy.

Indeed, the paper game could be just about to unwind now! You are so very right to say-------------------
" " Dont buy paper on the dips, cause its a shell game " "!

Gold has been in an unfolding story line for several years now. We have tried to isolate political and private movements that would impact the price of gold even sooner, as it travelled along it's destine path. But with each twist and turn the coming gold crisis was controlled with no perceivable change. At least not on the surface.

Oil always was the catalysis that would eventually begin the impact phase on gold's future. Whether it cam from outright intervention in the physical marketplace or by destroying the house of dollar credit with a large price rise,,,,, the dynamics of oil would eventually launch the Euro into reserve position. During that currency transition, physical gold would literally soar in price! Taking with it the entire financial structure of most of the dollar based banking system. Including most of the gold Bullion banking process.

With oil now above $32, it looks increasingly likely that we are about to start this process. With this in mind I repost an old piece. Perhaps I will also place it on the Trails page to remind everyone exactly how myself and others will be positioned for this turn of events.

Thanks Trail Guide

FOA (3/14/99; 17:33:37MDT - Msg ID:3369)

It should be obvious to all that I am not a trader. I do not think Another is either. Most of the observations given are offered to instil a path to follow for research, not to direct. Most gamblers (traders) try to find private information and act on it before it is common knowledge. Greed is the main motivation, certainly not the expansion of ones knowledge or protection of wealth. We often see people blindly follow the words of others without creating their own logical conclusions. No one will ever successfully manage their family wealth in this manner. Indeed, many have used the leverage of paper precious metals (including the white metals) to create great losses of wealth. Yet, Another has always striven to put the average citizen into physical gold as a percentage of their net worth. If you follow in the footsteps of giants, you gain proportionately as do these conservative people. My agenda is found in offering others an agenda that will hold true in a changing world.
Follow the news, think for yourself, observe the outcome of events in a different light. I think you will find this an interesting story as it unfolds. Yes, it is slow, but it holds true! The game of chess has many outcomes, but the objective is always to complete the journey with all of your
pieces (wealth) intact! FOA

Buena Fe
(03/06/2000; 16:06:07 MDT - Msg ID: 26449)
Speculations
Does anyone have the specifics on the Swiss gold sale of 1300 tonnes? I thought that March 10th was the last date for the Swiss people to effectively oppose/block this action. If I was the buyer of all this gold, I would not want the price to rise or attract to much attention until my purchase was secure (beyond recourse), but after I was confident that nothing could get in the way of this wealth transfer I'd be happy to see an increase!!
elevator guy
(03/06/2000; 16:33:18 MDT - Msg ID: 26450)
@Trail Guide, #26448
I feel like I just got a star on my forehead! Thanks!
MarkeTalk
(03/06/2000; 17:43:32 MDT - Msg ID: 26451)
Dow sells off on rate hike fears
http://www.cnnfn.com/2000/03/06/markets/markets_newyork/Greenspan's speech today about further interest rate hikes rattled markets, including the high techs. Oil surging $0.68 per barrel did not help stocks either. And OPEC meets on March 27th to decide whether to increase oil output. If OPEC can't or won't increase production, what a great cover story to sell stocks and/or to sell them short.
beesting
(03/06/2000; 18:59:17 MDT - Msg ID: 26452)
U.S.Gvt. snooping report!
http://abc.net.au:80/ra/newsdaily/rael-6mar2000-198.htmA United States Government report claims the Pacific Island Nation of Nauru(400 financial centers) is the worlds second largest tax haven operator. First is The Cayman Islands.(584 financial centers) Click URL for full story.

beesting comment-Don't the owners of these Financial Centers know how to store real wealth, tax free??
Those in the Know.....Buy Gold.....beesting.
Cavan Man
(03/06/2000; 19:44:29 MDT - Msg ID: 26453)
Trail Guide
I've done the homework and could pass with at least a solid B+ but still can't figure out the right percentage. How does one determine the correct percentage in PM? A mutual friend has said 50/50 (gold/cash) excluding real estate. Depending on a households cash flow, I believe the percentage could be much higher and probably should for the medium to long term. What do you think?
Trail Guide
(03/06/2000; 19:59:41 MDT - Msg ID: 26454)
(No Subject)
http://www.goldminingoutlook.com/All:
It's not easy to trade an impending currency crisis. Especially one in the making for so many years.
I submit that all the contract forms that this gentleman tracks will soon become a whirlwind. We shall see!



From Mr. KAPLAN'S web site--------------

QUESTION:
Why are there so many recent changes to your outlook for gold?

ANSWER:
Rarely are there so many conflicting signals.

Sentiment is somewhat bearish, but not markedly so;

fundamentals are improving steadily, with unexpected setbacks;

commodities as a group remain strong, but a few key ones are still in danger of a pullback;

the U.S. equity market and the U.S. dollar are acting oddly;

the Australian dollar looks as though it is recovering and then moves to new lows;

technical indicators indicate an important pivot point but are less clear on direction.
Cavan Man
(03/06/2000; 20:02:50 MDT - Msg ID: 26455)
The Dollar's Prognosis
If you believe the dollar is indeed the sick man of the international monetary system and that the political will exists to break the dollar hegemony as described by TG, then, you must buy all the metal you can with both hands IMHO.

Today I had the good fortune of visiting with some old acquaintences in KC. These gentlemen are very wealthy and they were kind enough to toss me a couple of million bucks of business. On my way back to the airport I began to wonder how many people (like Pat & Mike)there must be in the same city; in the same county; in the same state; in the USA and in the world. The answer is of course, too many to even begin to contemplate. These two gentlemen are "new money" types; not the "old money" variety. What will happen to the POG when this "new money" set begins to buy metal due to the circumstances so ably detailed by TG/FOA? Can $10K/OZ be far away?

Why would someone expend so much time, energy, emotion and intellect for so long without absolute conviction and certainty as TG has. The voice behind the page is one of wisdom and experience. Please permit me to also say "kindness". If you're new to this site, call USAGOLD tomorrow and take the plunge! Buy as you are able!!

Sorry for the rambling. Good evening.
Journeyman
(03/06/2000; 20:12:59 MDT - Msg ID: 26456)
Emerson Case info @ SteveH; THANX!!

Thanx -- will pass this on to a couple lists of pro-self defense writers!!

Regards,
J.
Trail Guide
(03/06/2000; 20:13:31 MDT - Msg ID: 26457)
Reply
Hello Cavan Man,
If the hard portion of your investments were like their 50% (or larger or smaller) in bullion (or even gold stocks and options). Now say they went to zero for a while, would it change your lifestyle much? Could you sleep at night?
Or if it went sky high,,,,, could you stand not to sell for a while?
It would not change anything for me. So my position and perception of this market is right,,,,, for me.
How about you?

Be back tomorrow TG
Cavan Man
(03/06/2000; 20:17:23 MDT - Msg ID: 26458)
Trail Guide
That helps. Then, like marriage; to have and to hold till death do you part! who wudda thunk it?
GFD
(03/06/2000; 20:25:32 MDT - Msg ID: 26459)
ORO (3/6/2000; 9:59:34MDT - Msg ID:26436)
Excellent Post!! Kudos!
Journeyman
(03/06/2000; 20:26:11 MDT - Msg ID: 26460)
18% production and the future @ORO

Excellent, naturally! Thanx.

Your response way over-compensated for the Ohmae info I posted.

I particularly resonate with your insight on the return of time to the consumer made possible by internet distribution. This is very interesting to me from several perspectives. It seems to me that the Austrians don't like "labor theory of value" type reasoning, mainly because Ricardo's insights were morphed into socialist excuses by Marx. But an expansion of the definition of "labor," it seems to me, can make a modified Ricardian approach highly useful for micro-economic explanations.

Regards,
Journeyman
Cavan Man
(03/06/2000; 20:38:25 MDT - Msg ID: 26461)
Sir Trail Guide
Many thanks. I understand (I think) your reluctance but, more importantly, I understand your reply. I'll not consume any bandwidth here again with the likes of that.

Without the www, how to get to know (a wee bit) someone like you? Kind regards........CM
Mr Gresham
(03/06/2000; 20:38:42 MDT - Msg ID: 26462)
Skinner box for goldbugs
Classic Skinnerian behavioral conditioning: we've had two POG spikes in the past six months, and little else. But it's enough to keep us checking Kitco's graph twice a day --whenever we log on, right?

Intermittent reinforcement is the strongest for conditioning.

POG-watching's the antithesis of what FOA and Aristotle are talking about, but -- hey, we're human, and most of us are new at this POG game.

I still think of incessant POG-watching as pretty silly compared to a stock in the $30 range -- who cares if it's $28 one day, $32 the next, and back down to $29? Happens all the time with stocks, and those are the same scale of movements we spend our thoughts energies upon. ("A watched POG never ______"?)

FOA's thesis on this is, basically: Because of the politics, and TPTB pulling out their stops, you'll see nothing happen for long periods, until they can't keep it stable any more. And then all of them who are going to get on board probably will have done so, so let 'er rip!

I still wonder who the agents of that policy are, and whether they're all trading for their own accounts, or whether some are promised loss reimbursement for the bets they make in the "line of national duty."

Now to read today's juicy stuff...



Journeyman
(03/06/2000; 20:51:04 MDT - Msg ID: 26463)
Paradigm shifts & Scientific revolution structures @Goldsun, etc.

Long time ago for me reading "Structure of Scientific Revolutions" also. The most striking thing that sticks with me from that book, relevant to economics especially in bubble times, is that the thinkers who went against the establishment, EVEN IN SCIENCE!!, were risking at least their reputations and futures, if not, in days gone by, their freedom and their lives. Pastuer and Copernicus come to mind as past extremes. Which remids me of a more current example from a book called "The Third Culture:"

"In 1966, I wrote a paper on symbiogenesis called, "The
Origin of Mitosing [Eukaryotic] Cells," dealing with the
origin of all cells except bacteria. ...The paper was
rejected by about fifteen scientific journals ...the editor
of _The Journal of Theoretical Biology_, accepted it and
encouraged me. At the time, I was an absolute nobody, and,
what was unheard of, this paper received eight hundred
reprint requests. ...Even today most scientists still don't
take symbiosis seriously as an evolutionary mechanism. If
they were to take symbiogenesis seriously, they'd have to
change their behavior. The only way behavior changes in
science is that certain people die and differently behaving
people take their places."
... "Symbiogenesis has many implications, which is part
of the reason it is controversial. Most people don't like to
hear that what they have been doing all these years is
barking up the wrong tree."
..."Scientists and those who pay them have to dismiss
or ignore this potential reorganization [caused by accepting
the implications of "symbiogenesis"] because accepting the
shifting boundaries and new alliances is strange and costly.
It is far easier to stay with obsolete intellectual
categories." -Lynn Margulis, "_Gaia Is a Tough Bitch"_, in
John Brockman, The Third Culture, (New York, NY: TOUCHSTONE
1995), pg. 136 & 137
+
"If science doesn't fit in with the cultural milieu, people
dismiss science, they never reject their cultrual milieu! If
we are involved in science of which some aspects are not
commensurate with the cultural milieu, then we are told that
our science is flawed." p. 140

Suppose these same observations apply to people dismissing
economic ideas that also don't fit the current "cultural
milieu?"

Regards,
Journeyman
SLovelace
(03/06/2000; 21:32:18 MDT - Msg ID: 26464)
Breaking the Banks
There is way to drop the world banks to there knees. There
is a way to remove the strangle hold they unethically maintain on the value of gold. The manipulation can stop, now! I will paint an oil analogy which will paint the picture of gold.

The value of oil is determined by the oil cartel, OPEC. If they want the price of oil to rise, they simply reduce production. The end result; supply less than demand; the price increases. That's pretty simple.

Now for gold. If two or three of the worlds largest gold producers simply said we are stopping mining because we cannot afford to dig it out of the ground, and cease operation, what will happen? Supply will be less than demand; the price of gold increases.

I haven't a clue how to get these thoughts into the minds of the few people who could make this happen. Anyone out there up to the challenge?

Solomon Weaver
(03/06/2000; 21:47:49 MDT - Msg ID: 26465)
Why It's Not A New Cold War: Secondary Powers and the New Geopolitics
http://www.stratfor.com/SERVICES/giu2000/030600.ASPThis is an interesting article on the "secondary" powers behind USA, China, Russia.....it is using France as the primary example...and by extension the EU.

Good read for rounding out the Another/FOA scenario.

Poor old Solomon
Golden Calf
(03/06/2000; 22:00:56 MDT - Msg ID: 26466)
Gold in all forms
Despite the bias opinions of some.....ABX and others
like PDG, HGMCY, NEM, HM, are looking good on the long
term(monthly) charts, and should start a major bull market
shortly.
Great, if you have investments you can take profits on
and switch some to gold in bullion, coin, stock and other
PMs.
Check out the charts, read all the opinions, and make
your own decisions.....it's your money after all, now
isn't it?
Goldsun
(03/07/2000; 02:32:56 MDT - Msg ID: 26467)
Shifting Scientific Structures
Journeyman
Glad you enjoyed The Structure of Scientific Revolutions. You've reminded me that Thomas Kuhn had an Austrian outlook. He felt scientific theories were valued at the margin. A few stray bits of data cause a theory which explains all the rest of the facts to be discarded.
Investors have an advantage over scientists. We are not at the mercy of journal editors, Nobel committees, etc. If our theories are correct, we are rewarded. Subject of course to market manipulation, taxes and outright confiscation.
I don't recall that Copernicus suffered for his theories. He was actually an employee of the Catholic Church and its hierarchy encouraged him to publish.
GoldsunView Yesterday's Discussion.

SteveH
(03/07/2000; 04:49:23 MDT - Msg ID: 26468)
Crude oil futures
$32.62 and rising (up .44). SUV for sale.
Henri
(03/07/2000; 06:51:26 MDT - Msg ID: 26469)
But I'm NOT watching it :-)
Kitco shows spike up at NY opening
JCTex
(03/07/2000; 07:48:35 MDT - Msg ID: 26470)
SteveH/ oil, gold, & SUV
Assuming the SUV is a late model, and in very good condition, I might pay you 1 Krugerrand for it. Let me know if you are interested.
TheStranger
(03/07/2000; 07:59:50 MDT - Msg ID: 26471)
Inflation Update
"Procter & Gamble (PG:NYSE - news - boards) warned
investors that it would post third-quarter earnings 10% to
11% below the year-ago 72-cent report. The company
blamed their earnings shortfall on the higher cost of pulp
and petroleum-based materials."

Stranger's Note: This is a story which will continue to unfold until Main Street recognizes that higher costs are not going to go away. (Psssst, Procter & Gamble, just raise your prices. Your competition will follow just like they followed Fed Ex).
elevator guy
(03/07/2000; 08:13:02 MDT - Msg ID: 26472)
@Goldsun, last post



"Subject to of course to market manipulation, taxes, and outright confiscation."

(Smile)
The Invisible Hand
(03/07/2000; 08:18:41 MDT - Msg ID: 26473)
SUV - semantic question
What does SUV mean / stand for?
USAGOLD
(03/07/2000; 08:21:58 MDT - Msg ID: 26474)
Today's Gold Report: What's Going On In the Gold Market -- An Overview
http://www.usagold.com/Order_Form.html3/7/00 Indications
�Current
�Change
Gold
289.90
+2.00
Silver
5.14
+.03
Gold Lease Rate
0.5700%
nc
Gold Comex Stocks
1,373,896
nc


Market Report (3/7/00): Gold surged in early New York trading after a
quiet night overseas. Over the past several weeks we have heard
recurring reports from wholesales traders that there is an abundance of
metal on the market. Why then haven't prices reflected the large sales?
Instead gold has hung within a narrow range at one point surging well
over $300. Our view is that demand remains very strong in the physical
market both in the United States and overseas and traders short the
market are forced to square their positions on any significant dips.
Once a downside trading range establishes itself -- buttressed by the
physical buying -- the shorts find themselves forced to cover realizing
that chances are the metal isn't going much lower. We expect this set of
circumstances to dominate market thinking in the weeks and months ahead
as the gold carry trade continues to unwind at the major banks and
brokerages that have fed at the gold loan/forward trough since at least
the mid-1990s. Many prominent gold traders have lost their jobs, if
rumors are to be believed, gold trading departments closed down and
those still hanging on to their jobs wonder what will greet them at
their desk when they arrive at the office in the morning. These are the
aftershocks of the Washington Agreement earthquake which shook the gold
business in late September last year and sent the gold price careening
toward the $350 mark. We believe that those aftershocks will continue
for some time and we could even get another earthquake or two as we go
along through the year 2000. The net result in our opinion will be a
stairstep demarcation to the charts with gold moving steadily upward,
more short players losing their jobs as positions are unwound, investors
steadily acquiring physical metal, and the paper markets steadily but
relentlessly losing volume.

Today's action has all the earmarks of short-covering given the
suddeness of the move -- as if someone lost their nerve. We'll see what
happens as the day progresses. My advice -- cover those shorts; we're
going higher.

That's it for today, fellow goldmeisters. See you here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click and link supplied above and make the appropriate entries.
Phos
(03/07/2000; 08:35:39 MDT - Msg ID: 26475)
The Invisible Hand - SUV
Sport Utility Vehicle.
beesting
(03/07/2000; 08:35:57 MDT - Msg ID: 26476)
The Excitement is Building!!!
http://quote.yahoo.com/q?^DJI&d=1dCheck out the chart, the Dow Jones average lost over 300 points in about 30 minutes this morning, and at this minute Gold is up almost 5 dollars and rising!!!

Gandalf, WAKE UP THOSE HOBBITS, to see the action!!!

Those in the know....Buy Gold....beesting.
beesting
(03/07/2000; 08:42:47 MDT - Msg ID: 26477)
Try this URL for DOW chart!
http://quote.yahoo.com/q?s=^DJI&d=1dSorry too much excitement.....beesting.
ORO
(03/07/2000; 08:51:01 MDT - Msg ID: 26478)
PPT intervention today
I keep an open window on the SP premium during most of the day. During PPT interventions it sticks out like a sore thumb.

As the SP 500 anvil index fell, the premiums went up to the 900 range. The drop stopped at established support levels. Contrary to normal market action, the premium dipped to near 0 immediately after stabilization. Probably because of an effort to avoid the leakage of general market support funds into the NASDAQ stocks common to both the SP and the ND100.



lamprey_65
(03/07/2000; 09:14:56 MDT - Msg ID: 26479)
This just in...
From Bridge News -

Audit office confirms probe into UK Treasury gold sales
London--Mar 7--The National Audit Office confirmed on Tuesday that it was conducting a routine investigation into the Treasury's decision to sell a share of its gold reserves but said it would not be in a position to publish anything
until around December. An NAO spokeswoman dismissed newspaper speculation that the inquiry would "savage" Chancellor of the Exchequer Gordon Brown's decision
to press ahead with the sales, saying it was far too early for the investigation to have reached any conclusions. (Story .12629)

TownCrier
(03/07/2000; 09:35:17 MDT - Msg ID: 26480)
The fate of the IMF
http://biz.yahoo.com/rf/000306/9o.htmlThe wrangling over choosing a successor to former IMF head Michel Camdessus is said to rest upon the future role of the IMF as much or moreso than upon the particular qualifications of any given candidate.

Reuters reports "The United States wants to make it into a leaner body dealing with economic crises rather than sponsoring and encouraging long-term economic reforms."

Doesn't that imply that the U.S. is simply wanting a scaled-down version of "business as usual"? I say, "Nuts to that. Bring on the reform."
beesting
(03/07/2000; 09:42:03 MDT - Msg ID: 26481)
Seperation of Physical Palladium market from Paper Palladium market!
http://biz.yahoo.com/rf/000307/ym.htmlExcerpt:
The Russians confirmed on Tuesday that an export decree has been signed, but they would be unlikely to sell on the London Fix, because it would send prices tumbling. Prices have been frozen on the largest Palladium Futures Exchange, The Tokyo Commodities exchange(TOCOM){A PAPER PALLADIUM EXCHANGE} until at least March 15, and the Russians are expected to avoid it.
Therefore, Russia will probobly sell through a small trading house to industrial clients, yeilding only a small price effect, while healthy car demand will prop up prices....Click URL for complete news release.

Comment: From producer to consumer without the aid of middlemen.
Gandalf the White
(03/07/2000; 09:42:07 MDT - Msg ID: 26482)
GOOD Morn Beesting & ORO
WOWSERS --- Just let the Hobbits sleepin one morn and see what happens !! -- Missed both the dog SPIKE and the return of the PPT actions. -- Looks as if things are getting interesting again. Is Spot awake now Goldfly ?
<;-)
beesting
(03/07/2000; 09:42:07 MDT - Msg ID: 26483)
Seperation of Physical Palladium market from Paper Palladium market!
http://biz.yahoo.com/rf/000307/ym.htmlExcerpt:
The Russians confirmed on Tuesday that an export decree has been signed, but they would be unlikely to sell on the London Fix, because it would send prices tumbling. Prices have been frozen on the largest Palladium Futures Exchange, The Tokyo Commodities exchange(TOCOM){A PAPER PALLADIUM EXCHANGE} until at least March 15, and the Russians are expected to avoid it.
Therefore, Russia will probobly sell through a small trading house to industrial clients, yeilding only a small price effect, while healthy car demand will prop up prices....Click URL for complete news release.

Comment: From producer to consumer without the aid of middlemen....Where have I heard that before???....beesting.
beesting
(03/07/2000; 09:43:20 MDT - Msg ID: 26484)
Seperation of Physical Palladium market from Paper Palladium market!
http://biz.yahoo.com/rf/000307/ym.htmlExcerpt:
The Russians confirmed on Tuesday that an export decree has been signed, but they would be unlikely to sell on the London Fix, because it would send prices tumbling. Prices have been frozen on the largest Palladium Futures Exchange, The Tokyo Commodities exchange(TOCOM){A PAPER PALLADIUM EXCHANGE} until at least March 15, and the Russians are expected to avoid it.
Therefore, Russia will probobly sell through a small trading house to industrial clients, yeilding only a small price effect, while healthy car demand will prop up prices....Click URL for complete news release.

Comment: From producer to consumer without the aid of middlemen....Where have I heard that before???....beesting.
TownCrier
(03/07/2000; 10:16:08 MDT - Msg ID: 26485)
Excerpts of Remarks by Fed Chairman Alan Greenspan
http://www.bog.frb.fed.us/BoardDocs/Speeches/2000/20000306.htmDelivered to the Boston College Conference on the New Economy, Boston, Massachusetts; March 6, 2000.

"In the last few years it has become increasingly clear that this business cycle differs in a very profound way from the many other cycles that have characterized post-World War II America. Not only has the expansion achieved record length, but it has done so with economic growth far stronger than expected. Most remarkably, inflation has remained largely subdued in the face of labor markets tighter than any we have experienced in a generation."

"When historians look back at the latter half of the 1990s a decade or two hence, I suspect that they will conclude we are now living through a pivotal period in American economic history. New technologies that evolved from the cumulative innovations of the past half-century have now begun to bring about dramatic changes in the way goods and services are produced and in the way they are distributed to final users. Those innovations, exemplified most recently by the multiplying uses of the Internet, have brought on a flood of startup firms, many of which claim to offer the chance to revolutionize and dominate large shares of the nation's production and distribution system. And participants in capital markets, not comfortable dealing with discontinuous shifts in economic structure, are groping for the appropriate valuations of these companies. The exceptional stock price volatility of these newer firms and, in the view of some, their outsized valuations indicate the difficulty of divining the particular technologies and business models that will prevail in the decades ahead.
How did we arrive at such a fascinating and, to some, unsettling point in history?"

"At a fundamental level, the essential contribution of information technology is the expansion of knowledge and its obverse, the reduction in uncertainty. [...]
Of course, large voids of information still persist, and forecasts of future events on which all business decisions ultimately depend will always be prone to error. But information has become vastly more available in real time--resulting, for example, from developments such as electronic data interface between the retail checkout counter and the factory floor or the satellite location of trucks. This surge in the availability of more timely information has enabled business management to remove large swaths of inventory safety stocks and worker redundancies. Stated differently, fewer goods and worker hours are now involved in activities that, although perceived as necessary insurance to sustain valued output, in the end produced nothing of value.
Those intermediate production and distribution activities, so essential when information and quality control were poor, are being reduced in scale and, in some cases, eliminated. These trends may well gather speed and force as the Internet alters relationships of businesses to their suppliers and their customers..."

"The impact of information technology has been keenly felt in the financial sector of the economy. Perhaps the most significant innovation has been the development of financial instruments that enable risk to be reallocated to the parties most willing and able to bear that risk. Many of the new financial products that have been created, with financial derivatives being the most notable, contribute economic value by unbundling risks and shifting them in a highly calibrated manner. Although these instruments cannot reduce the risk inherent in real assets, they can redistribute it in a way that induces more investment in real assets and, hence, engenders higher productivity and standards of living. Information technology has made possible the creation, valuation, and exchange of these complex financial products on a global basis."

[Next up...A CAUTION: where the illusory economy meets the real economy...(sounds familiar, doesn't it, ORO?)]

"There can be little doubt that, on balance, the evolving surge in innovation is an unmitigated good for the large majority of the American people. Yet, implicit in the very forces of change that are bringing us a panoply of goods and services considered unimaginable only a generation ago are potential financial imbalances and worker insecurities that need to be addressed if the full potential of our technological largesse is to be achieved.
+
As I testified before the Congress last month, accelerating productivity entails a matching acceleration in the potential output of goods and services and a corresponding rise in real incomes available to purchase the new output. The pickup in productivity however tends to create even greater increases in aggregate demand than in potential aggregate supply. This occurs principally because a rise in structural productivity growth, not surprisingly, fosters higher expectations for long-term corporate earnings. These higher expectations, in turn, not only spur business investment but also increase stock prices and the market value of assets held by households, creating additional purchasing power for which no additional goods or services have yet been produced.
+
Historical evidence suggests that perhaps three to four cents out of every additional dollar of stock market wealth eventually is reflected in increased consumer purchases. The sharp rise in the amount of consumer outlays relative to disposable incomes in recent years, and the corresponding fall in the saving rate, is a reflection of this so-called wealth effect on household purchases. Moreover, higher stock prices, by lowering the cost of equity capital, have helped to support the boom in capital spending.
+
Outlays prompted by capital gains in equities and homes in excess of increases in income, as best we can judge, have added about 1 percentage point to annual growth of gross domestic purchases, on average, over the past half-decade. The additional growth in spending of recent years that has accompanied these wealth gains, as well as other supporting influences on the economy, appears to have been met in equal measure by increased net imports and by goods and services produced by the net increase in newly hired workers over and above the normal growth of the workforce, including a substantial net inflow of workers from abroad.
+
But these safety valves that have been supplying goods and services to meet the recent increments to purchasing power largely generated by capital gains cannot be expected to absorb indefinitely an excess of demand over supply. Growing net imports and a widening current account deficit require ever-larger portfolio and direct foreign investments in the United States, an outcome that cannot continue without limit.
+
Imbalances in the labor markets perhaps may have even more serious implications for potential inflation pressures. While the pool of officially unemployed and those otherwise willing to work may continue to shrink, as it has persistently over the past seven years, there is an effective limit to new hiring, unless immigration is uncapped. At some point in the continuous reduction in the number of available workers willing to take jobs, short of the repeal of the law of supply and demand, wage increases must rise above even impressive gains in productivity. This would intensify inflationary pressures or squeeze profit margins, with either outcome capable of bringing our growing prosperity to an end. In short, unless we are able to indefinitely increase the rate of capital flows into the United States to finance rising net imports or continuously augment immigration quotas, overall demand for goods and services cannot chronically exceed the underlying growth rate of supply."

"Until market forces, assisted by a vigilant Federal Reserve, effect the necessary alignment of the growth of aggregate demand with the growth of potential aggregate supply, the full benefits of innovative productivity acceleration are at risk of being undermined by financial and economic instability."
MarkeTalk
(03/07/2000; 11:22:14 MDT - Msg ID: 26486)
Oil prices @ $33.75
The oil market continues its relentless move higher today, as light sweet crude just hit $33.75 per barrel. Today's Wall Street Journal, section C, carried a story about Norway and Nigeria unable to pump oil due to "computer glitches." Thus, the real Y2K story is and remains oil. Rumors are now circulating that Clinton will resort to rationing. Say goodbye to the summer vacation in the RV driving across country and say hello to $2.00 per gallon gasoline. As an aside to those readers of Wolanchuk, he predicted in an interview with Stockhouse (www.stockhouse.com) that oil would see $50 per barrel sometime in 2000. In another interview with Stockhouse, Wolanchuk predicted that gold would go over $800 per ounce--and soon.
ORO
(03/07/2000; 13:25:19 MDT - Msg ID: 26487)
Journeyman - Econ - science and politics
The basic point separating economics theories is the motive - study vs. politics.

Economists - like anybody else atune to the changing times - see no point in study of economics if the main employer would be politics. In this case, the politics are dictating the economic picture and nothing is as important as telling politicians that no negative consequences would be forthcoming if the economist gets the job of running the programs, or at the very least a big research grant. What else would they say? That any program sponsored or run by government will reduce the overall welfare? That government is the tool of thievery? That the parliaments are but the vanguard of the Hun?

In the actual study of economics - something that rarely happens outside of econometric models for microeconomic analysis - has been relegated to the sidelines for the better part of a century. This was the century of government. The bulk of the century was dominated by the single generation of cannon fodder - the global GI generation. A generation engineered for the promotion and use of government for itself - a contract of sorts between the government and the generation. It was the one group that voted in any and all government programs that would benefit itself at the world's expense and at the expense of their parents and their children.

Before WWII they were young and poor and focused on the socialist non-economics of Marx - not in the study of it but the implementation of the power equations that Marx set up to describe the ability of labor to forcibly take over vulnerable industrial installations and for government to control and take away the benefits of business. It was the generation of collective rule. Theirs were the economics of coercion - in Union-Industry negotiation, in the only foreign trade policy this country has had for 60 years - whatever else happens, the dollar will be the reserve currency. And the policies in the times of gold settlement of international trade in the 20 years before - we will only export.

The only true economic study this generation did was of the means to maximize its own allocation of world resources. Using the military to force all competition out of the former European colonies (by holding overwhelming forces on the territory of all European colonizers) the US supported more dictators than did the Soviets while forcing the European nations to unload their colonies into "independence" under US sponsored rulers. Often, this would backfire as the countries would change allegiance to the Soviet side, which favored Europeans who were better equipped to do business.

US government military-economic studies I had seen from the 50s and 60s dealt with the methods and means to obtain resources from "developing nations" - i.e. collonies - for US "strategic needs". Particularly when the possibility of obtaining them for no payment (i.e. pay in dollars with a promise of non-redemption in gold given by the seller) was possible. These studies by microeconomists and industry experts were where honest efforts were made to understand the economics. There was little one could gain from any other economic work, since its motives were propaganda, not study and analysis.

This generation of economists is largely gone. Their caretaker successors are disappearing as well, leaving behind many economists beleaguered by the inability of orthodoxy to explain any economic phenomenon they observe. Because of this, there is a trend of transition to Austrian economics. Another reason for this trend is that the ability of government to exact tribute from its citizens (read "serfs") and from citizens of other lands is falling rapidly as the information technology infrastructure is put in place that makes possible the total hiding of transactions from governments' searching gaze and its prying hands.

Economists started talking of the damage government does because government reach was weakening and its ability to employ economists was falling. Government has responded within the US with the slow dismantling of regulation and lowering of tax rates so that the motive for hiding income and assets is reduced and more of them can be taxed. This was where economists - "supply siders" - were just beginning to study economics instead of providing propaganda. Now, however, there is a strong move of capital out of both the US and Europe - and prior to that from Japan - into the developing nations and the tax havens.

These movements have put both Europe and the US in danger of losing their physical and human capital. Where capital goes, people are soon to follow. The EU economic zone was intended, among other things, to allow the Europeans to deregulate and lower taxation. This is in order to both allow big money to exit, and to bring back Europe's competitive edge in sophisticated design and high standard craftsmanship of custom products. By publicizing its coming lowering of taxes, and by practicing habits of tax havens for large capital, Europe is following its "old style" economist's advice, not because they want to, but because they have to. The state can't maintain taxation and regulation at current levels without losing its most productive people to the developing world, where a greased palm is ten times cheaper than paying official taxes for a lifetime.

Austrian economics is gaining in following everywhere because of the current trends of government action being forced by the real economy. The study of actual economics has become more important than the provision of propaganda for government. The infrastructure of technology and political will in smaller nations is in place to provide shelter to capital and high income individuals.

The question remaining is just how far will governments of "industrialized" countries go in either succumbing to reality, or taking all-out action to prevent it from coming. The fight between the US and Europe for monetary dominance is only one symptom of the sclerotic nature of government power in the early 21st century. If a 2-2.5 fold overvaluation of currency in industrialized nations is not enough to keep the high value business and people within reach of US and EU taxes, but only those of one of the two regions; then the fight for control of the monetary system will most probably result in the destruction of both group's powers. If they raise taxation in order to cater to their ancient retirees, they will cause a mass migration of their technology elites elsewhere.

During the 50s and 60s - and well into the 70s, European governments at once tried to control its own citizens while attracting wealth from the US, which was penalizing its high income earners with 70% Federal tax rates and total marginal tax burdens above 93%. Though these rates have fallen somewhat in the US, the slightest damage to the dollar would push us all out of US assets and out of US residency, and would cause the US government to attempt the collection of tax at levels of complete confiscation. This could be excercized as it is by many US marshals and county governments by confiscation of "drug related" property.

If popular opinion is ignored and the governments of the US and Europe simply reduce taxation and regulation to a level of competitiveness with the developing nations, then the US would win out over Europe. Otherwise, the trade mechanism of the EU will force governments to compete among themselves to retain business and high value individuals.

Current talk of opening the US to imigration and of flat taxes is the positive side seeking to tune government to the reality of the global economy.
Talk of extending medicare is just a last grasp by government at what might become a popular platform for retaining some power. I hope the social "safety net" (it really isn't there) will be taken apart before it tears and causes a disaster when people are not prepared for it.

In this debate among the economists and economic propagandists as to which direction to take the country, I would side with those who care to study reality and recognize that actions have consequences.
ORO
(03/07/2000; 13:37:35 MDT - Msg ID: 26488)
Stocks slide
Dow Industrial 9,793.40 -377.10
NASDAQ 4,869.50 -35.35

Advance Decline
NYSE Adv/Dec +964 -2,028

NYSE Volume 1,136,295,840 shares

PG looks like the bones left after momentum leaves a tech stock. Beware of the shape of things to come.

Ick.
CoBra(too)
(03/07/2000; 13:50:31 MDT - Msg ID: 26489)
It's pretty "Gory" beating around the mulberry "Bush"
in full view of the super tuesday ending in a vote of no confidence for both? contenders - at least according to the DJII, where the president's electorate is seen selling their (poor) multiple choice short.
Reminds me of EU's new Pariah, Austria. A country acclaimed as the sound heart of Europe is now seen in need of 14 EU-Pacemakers.
I M F(ed) up - CB2
CoBra(too)
(03/07/2000; 14:02:22 MDT - Msg ID: 26490)
ORO - Your 26 487
Thank you, Sir - right on the dot - loved it- Best CB2
Cavan Man
(03/07/2000; 14:17:17 MDT - Msg ID: 26491)
ORO 26487
***** (Five star/Highest Rating)

Wake up call; hello America. Anybody home?
TheStranger
(03/07/2000; 14:20:21 MDT - Msg ID: 26492)
Inflation Update
Rom Yahoo:
U.S. oil industry hit by labor shortage

By Richard Valdmanis

NEW YORK, March 6 (Reuters) - The labor shortage that has savaged U.S. industries
from high-tech to financial services has now hit the oil patch -- another blow to the nation's
fuel consumers.

With oil and gasoline prices hovering at nine-year highs, U.S. oil companies are anxious to ramp up crude production and
rebuild emaciated inventories, but they are finding the task difficult because there aren't enough rig hands and field engineers to
go around, industry watchdogs say.

``Any kind of substantial increase in production would be most difficult now because we don't have the people to fill the jobs,''
said Don Briggs, head of the Louisiana Independent Oil and Gas Association (LIOGA). ``From Texas to Louisiana to
Oklahoma, producers are having trouble finding people, and the domestic industry is suffering.''
ORO
(03/07/2000; 14:29:39 MDT - Msg ID: 26493)
Farfel - Shorting techs
I am starting to establish tech index shorts beginning tomorrow - when I expect they will enjoy a rebound if the DOW and SP recover late in the session - depending on the global market's reaction. Intend to scale up shorts if there is a rise, buy back when there are signs of strength following further falls on the heels this initial weakness. If the current slide resolves (as I expect it will soon - as the $ is still strong and strengthening - at least today) then the techs should enjoy a rally into early summer accompanied by a slightly broader market advance. There is a good chance for a tech blowoff at that time, if not now.

Farfel - I sold another 1/4 of my remaining VENGF - now have only 1/8 of the original position.

Town Crier - quite a bit of the thinking I put into my analysis came from Fed papers and Greenies' speaches and Q&As. It is somewhat like reading a Mark Twain riddle story, but ends up being quite informative.

Disclaimer - dis ain't financial advice, do not do as I do.

If I am aware of the great uncertainty in markets I follow daily, then if you need advice you should not even consider doing this!!!
CoBra(too)
(03/07/2000; 14:45:40 MDT - Msg ID: 26494)
Deutsche Bank courting Dresdner Bank!
May be forming the largest banking entity globally. The potential new banking group would cater to more tan 10 million clients, with 120.000 employees globally.
Some may want to get too big to sink - what'ya think?
CB2
CoBra(too)
(03/07/2000; 15:13:01 MDT - Msg ID: 26495)
@ Sir Stranger - Your Reuters quote - requoted
' Labor shortages ravaged by U.S. Service Industries - from Hi Tech to (Hi) Fi(nancial) Services has now hit the Oil Patch (among other fundamental resource sectors as farming and mining - expendable as non core CP -Inflation indicators) - is seen as another "fuel" to blow-torch the Nation's overconsumers.
Seriously - don't take me for serious my friend and Fremder - CB2
TheStranger
(03/07/2000; 15:14:15 MDT - Msg ID: 26496)
Proctor & Gamble and Gold
Today's news from Proctor & Gamble was a watershed event which had everything to do with the rally in oil and gold.
The admission that P&Gs profit margin is now being sqeezed by higher costs hit the street like a lightening bolt. After this, Wall Street will no longer accept unquestioningly the heavily massaged inflation reports which emanate from Washington D.C. The notion that it is "only oil" has now been exposed for the silly fraud it always was. The fact is, oil is the most pervasive of all commodities with respect to overall price influence. If oil prices even drive up costs for such mundane products as Tide and Crest, then they are effecting everybody.
CoBra(too)
(03/07/2000; 15:36:38 MDT - Msg ID: 26497)
Hi Stranger - I read you loud and clear on P&G!
... Protector's of Gamble's will be like the proverbial needle in the haystack? Is that's what your implying or is it the rusty pitchfork digging up all the extra soiled paper "bucks" in AG's overhedged aand derivative germ contaminated dungheap?
Sorry for being snide - had a great day - Best CB2
ORO
(03/07/2000; 15:48:14 MDT - Msg ID: 26498)
The Stranger - what about Bob?
Wall street is now noticing what eveybody who does his own shoping must know about prices.

The question now remaining is whether they will ask for higher pay as a result. The labor shortage pretty much dictates that they will get it if they ask. What will the golden years brigade do about their higher costs not being reflected in the COLAs? Will someone lose his bid at the presidency as a result?

What do the EU people want from the Krypton administration (capable of turning Super America into mush) that prompts them to come out with threats over the stock markets and the dollar? Perhaps they don't want the Fed to continue with its tightening (forcing the ECB to raise rates in order to maintain steady prices in the EU)?


CB2, C Man, THC, Journeyman, thank you much for the kind words.


CoBra(too)
(03/07/2000; 16:16:09 MDT - Msg ID: 26499)
After celebrating the last day of carneval (Fasching in my part of the wold)
back to reality - An unprecented 100 billion $'s of long bonds (30 yr tsy's) have been sold in the week from Feb. 11 -18, coinciding with Ts'y Secretary Summers' statement to pay back accrued debt from (virtual) budget surplus.
As Summers was accused of causing (excelerating) the invereted yield curve, some obstinate observers are still arguing this unprecedented 100b sale (as it seems to foreign, though friendly CB's), may have been the smokescreen to hide some gigantic systemic risks, which would not weather any taxpayers scrutiny after LTCM - The derivative scam seemingly haunts not only the economy - the global politics, but "virtually" the future of the cannibalistic capitalism of the few -too big to tank!
X-cuse venting & rambling - I'll Pro... & G(o)ambling
CB2 - ... You too - Yahoo... See through ... See U!
Harley Davidson
(03/07/2000; 16:48:49 MDT - Msg ID: 26500)
Tonight on CNBC
During one of the segments on CNBC this evening they showed a graphic of today's best performing sectors. There, at the top of the graphic was the gold sector with over a 9% increase and the oil sector with over an 8% increase. I wonder what was going through the minds of all the viewers as they looked at that?

Then in another piece, one of the parrots said "with some of the 'old economy' value stocks i.e. Coke, etc. at 3 to 4 year lows, its unclear whether there will be a sharp recovery or will the DOW slip into a bear market". Hah!

In another clip, they said "oil is 50% as important to the economy as it was in the 1970s". Does that mean oil can double in price to $64 per barrel and everything will still be ok?
Harley Davidson
(03/07/2000; 16:51:17 MDT - Msg ID: 26501)
P.S.
Oh yeah, and $300 billion dollars was vaporized in the DOW today.
Farfel
(03/07/2000; 17:01:12 MDT - Msg ID: 26502)
The DOW Carry Trade....You Heard It Here FIRST!
It is becoming very apparent that the very same con artists who ran the stock market into bubble territory this past decade on the backs of various commodity and currency carry trades are now ready to attack the only remaining huge source of available capital: DOW stocks.

Most of these con artists have long since departed the major DOW stocks and parked their monies in various NASDAQ high tech darlings. They recently moved the NASDAQ into sheer verticality with the NASDAQ rising virtually every single day this past month.

In order to maintain such verticality in the NASDAQ, it becomes necessary to draw funds from wherever they can be sourced. With many commodities and currencies now under scrutiny of various government regulators, then the easiest market to raid for NASDAQ capital inflows is none other than the DOW itself.

Thus I predict more Proctor and Gamble surprises in the DOW/Old Economy/Smokestack stocks as the NASDAQ bubble-manipulators and their captive media slaves seek to draw more capital into their vertical market tower.

Look for many articles slamming Old Economy smokestack companies over the next while as the NASDAQ furiously competes for funds parked in DOW investments.

I would not be surprised to see a surging NASDAQ occurring right alongside a collapsing DOW, no different than what occurred during the Nineties when gold & resource-dependent currencies collapsed during the surging US stock market.

Thanks

F*
nickel62
(03/07/2000; 17:50:47 MDT - Msg ID: 26503)
Farfel you are exactly right it is a corner of the shorts in the high tech NASDAQ
Very similar to the corners in the early days of this century in the Fisk and Gould era. They have got the shorts (who are anyone who thought the markets were still somewhat legitimate and sold the ridiculously overvalued tech stocks short) are cornered in their shorts and need to meet margin calls every morning to keep their shorts from being bought in. the only way for fund managers and hedgefund managers is to sell the Dow stocks that they own to raise the cash they need to cover the morning call. The end is near but not here yet.
Zenidea
(03/07/2000; 18:09:03 MDT - Msg ID: 26504)
MarkeTalk
I cant find that interview you spoke re stockhouse in msg 26486,
Can you be more specific re: directions please ?.
thanks :).regards.
MarkeTalk
(03/07/2000; 18:38:56 MDT - Msg ID: 26505)
Zenidea
In response to your request on Wolanchuk's predictions, I got part of my information from a post on the gold eagle website (www.gold-eagle.com) dated March 2, 2000. This post was an excerpt of an earlier interview done in 1999 when he stated that gold would go to $800/ounce. This same prediction was made to Stockhouse again on Feb. 8, 2000 and can be found on their website (www.stockhouse.com/interviews/feb00). The prediction on oil is from a recent issue of his newsletter. A friend of mine read it to me over the phone last month and, after repeated attempts to get a hard copy from him, I have yet to get my hands on it. So I would suggest subscribing to his service if you want verification. Sorry, that's the best I can do
Zenidea
(03/07/2000; 18:53:36 MDT - Msg ID: 26506)
Marke Talk
Found it :)
Solomon Weaver
(03/07/2000; 19:36:57 MDT - Msg ID: 26507)
Cobra(too) and ORO - Can you tell us more details about the way T-Bills are used in International Finance
CoBra(too) (3/7/2000; 16:16:09MDT - Msg ID:26499)
An unprecented 100 billion $'s of long bonds (30 yr tsy's) have been sold in the week from Feb. 11 -18, coinciding with Ts'y Secretary Summers' statement to pay back accrued debt from (virtual) budget surplus.
As Summers was accused of causing (excelerating) the invereted yield curve, some obstinate observers are still arguing this unprecedented 100b sale (as it seems to foreign, though friendly CB's), may have been the smokescreen to hide some gigantic systemic risks...
--

CB2 - Since I admittedly do not really understand the area of bonds and do not follow the markets...I have a hard time with understanding your quote...perhaps you, and or ORO could cover this topic of the 100 billion in 30 year T-Bills a little for us here at the forum.

Here is my present understanding: Back in the time period you mentioned in a period when the interest rates on short term bonds were rising rather dramatically, Secretary Summers announced that the Treasury would be "buying back" 30 years bonds...this "apparent pending shortage" of these important long term investments used by insurance and annuities investments drove the "price" up and the "interest rates" down...creating a sudden and unexpected inversion of the bond interest rates (which also seemed to cause some serious problems in interest rate swap portions of large derivitive programs at major banks).

Around this time, there was also an "auction" where T-Bills sold very poorly.

Now, you point out that at the same time Summers claimed he was going to call in 30 year bonds...it appears that foreign Central Banks are suddenly "buying" them (and I assume they are newly issued and sold directly).

One question I have is "what are those Foreign CBs buying these bonds with??? Dollar cash reserves which are accumulating because of trade deficit? If so, is this a way for the USA to call back some of the "big float" back home??? Can it be that some of the free dollars which this program liberates (from reserves) are being used to prop up "too big to fail types"? Is this a way for the US Gov. (Not FED) to generate some liquidity today in exchange for additional future obligations. Can it be that CBs who are buying understand that they will lose on the T-bills but those losses are needed to prevent serious hedgebook degradation?

This sounds like a story that goes way beyond "boring bonds"...

Poor old Solomon
USAGOLD
(03/07/2000; 19:38:10 MDT - Msg ID: 26508)
Interesting thoughts received by e mail...........
All: I received this interesting post by e-mail...Perhaps we should encourage this goodly knight to apply for a posting code and take his rightful place at this Table Round.......MK

------------------------------------------

FOLLOW THE MONEY


I have been observing the gold market for two years now and heartily agree
that these are indeed difficult times for the gold industry. However, I
continue to repeatedly take note of several interesting circumstances to
keep my sanity so that I may remind myself that these are not normal times
and that the present woven thread cannot remain woven forever before it
eventually snaps.

To keep my perspective & sanity I consider these facts:

1 Concerning the tightly held 280 - 290 gold price range. This is indeed
magnificent skill and craftsmanship (manipulation). Just the odds that
this
range can continue forever are greatly against its favor.

2 The stock market bubble is definitely a bubble and every bubble in
>history eventually breaks.

3 Generally, the achievements of one presidential administration do not
continue into the next presidential administration. Even should Gore
become
the next president Greenspan cannot live forever nor can this psychological
euphoria surrounding the financial markets continue forever unabated.

4 Is there really a present demand for gold and are its derivatives being
traded in a significant size each day? Even as sizable quantities of gold
have been sold by the central banks over the years was there ever a sale
where a buyer could not be found? Who has been doing this very significant
buying these past years?

5 Why are the major banks so eager to continue making very considerable
loans to mining companies if gold is such a poor investment and considered
by many financial "experts" to be in its death throes?

6 Follow the money.


Consider again these 3 most significant observations.

1 There is always a buyer at every central bank sale. Always an unknown
buyer.

2 Through hedging contracts the major banks are always willing to commit
themselves to purchasing gold at prices higher than the present market is
asking. Would this willingness to purchase gold at higher market prices
exist if the banking industry truly thought that gold was in its death
throws and had no
future other than as jewelry?

3 Most importantly, in my opinion, the major banks are continuing to
provide significant loans for the gold mining industry. Again, would the
major banks continue to provide support for an industry that in their
opinion had no future?

Yes. Follow the money. Always follow the big money.

The day that I see central banks and everyone else dumping their gold
reserves into the deepest ocean then I will give up on gold and the gold
industry in general. As long as I see ready and willing buyers for every
gold sale then I am reminded that gold has worth and significance.

Gold will have its day again and I personally believe that day is getting
closer.

I also will continue to "follow the money".

David Vaughn
USAGOLD
(03/07/2000; 19:50:03 MDT - Msg ID: 26509)
Holtzman...
Aren't we about due for a Holtzman post?

One (all encompassing) question for you, Sir Holtzman....

What is the overview from Britain on the euro and the latest announcement to continue the gold sales? I hate to see my second favorite country in the world go the way of the dinosaur (or Tony Blair). What does the typical British small business owner or medical/legal professional think of what's going on there? From afar, it all seems to be too much to absorb. It's happening so fast...or is that my imagination. And now this situation in Austria which almost serves as warning. What are the British people thinking about all this? I would really like to know. Does Margaret Thatcher speak anymore, and does anyone listen?

Solomon Weaver
(03/07/2000; 20:26:50 MDT - Msg ID: 26510)
FARFEL and the DOW carry trade
Farfel (3/7/2000; 17:01:12MDT - Msg ID:26502)
The DOW Carry Trade....You Heard It Here FIRST!
------
Farfel

Is it true that at "carry trade" is:
1. selling one investment short
2. taking cash proceeds from that sale
3. investing them in a different investment long

I could agree that selling DOW Index stocks short is a ripe source of funds for new carry trades but do you really believe that these folks would go long in the NASDAQ? Unless it is just day traders who short the DOW and then use the funds to take brief positions in momentum situations.

Would it not be more interesting to go long in another sector than stocks???

If it has been popular to short gold and buy stocks...why can't it become popular to short stocks and buy (paper) gold?

-------------

By the way...gotta tell you this one from my Broker...

Latest suggestion: Eastman Chemicals...why? Well, a while back they spun off from Eastman Kodak and are now a leader in BtoB...(Business to business sales of products over the internet)..

I told the broker ... Eastman Chemicals must be negatively correlated with the price of oil (a key raw material)...the broker (who worked as a futures trader in the recent past) thinks oil is ready for a "technical correction". Does he mean someone is correcting those y2k glitches?? (smile).

Eastman was "spun out" because Chemical Industries are very capital intensive (lots of capital on the books and lots of the cash flow pays for new plants which are amortized over 10+ years) and look bad when one calculates "return on equity". On the other hand, as long as they have chosen reasonable products, they can survive through most of the business cycle. Also, considering what ORO discussed yesterday about the next (and last?) wave of "productivity" improvements coming in "sales and distribution", there is a good chance that companies like Eastman Chemicals who feed directly at the commodity trough, will have a much better chance at passing on raw material costs than the guy at the end of the line making a 25% markup by selling over the internet.

It is interesting to me that as a Contra Investor, buying Eastman might be worth it now...but not at all for the reasons my broker gave.

What scares me is how much most brokers and investors believe the same crap.

Poor old Solomon

PS. What is the "market cap" Microsoft?
What is the "sharholder equity" of Microsoft.

Annual Reports publish return on sharholder equity.
Stock owners want return on person equity which equates to "return on market cap" (capital appreciation).

Are we coming to times when a new capital appreciation emerges...meaning appreciation of what capital really is?
4Ducat
(03/07/2000; 21:14:46 MDT - Msg ID: 26511)
That Market Mavericks Might Miss the Mess
http://www.usagold.comVery interesting day. What is happening in the Nasdaq as Nickel62 pointed out is that shorts are being squeezed and are scrambling to cover what they can thus pushing up the Nasdaq. This is very dangerous to the Nasdaq because once most of the shorts are burned out then there will be only long positions left. Short covering is what makes a falling market bounce back. With only longs selling in the next downturn, there is nothing to stop a freefall in tech stocks(shorts are gone). The DOW will be shorted more and may be more crash resistant because a lot of its stocks are already a beaten up. As I see it the falling of the blue chip stocks was the ringing of the bell high above the city. There is no safe haven for capital in the giant corporations because they are all so overvalued. Let's talk about B2B commerce when everyone will be cutting back to boost earnings. "Well since we can't sell anything lets find some one out there who has cash and lets merge with them." We can see how the strong companies don't need to merge while all the second tier corporations and laggards are on a consolidation binge with the mergermania. Mergermania allows the accountants to befuddle the numbers and add another mirror to the smoke. I think money is running into bonds and when the dollar gets weak then that game will get old. Gold is just another commodity like anything else and it should catch up to the rest of the metals. Those two steps up in the POG in NY today looked really nice with a little stalled rally at the end of the day. Notice how it didn't loose ground but only fell back to level, that's a healthy sign. The XAU may be in the beginning of a rally here. I think neither is first in the old POG vs XAU debate. They work on each other psychologically. Whichever one initiates the rally or decline, then the other one follows. We had a few goldstocks that were over shorted. That is all that rally was today, short covering. I suspect about half the shorts have covered and the rest are going to cover tomarrow sometime.

I think about this "wireless internet" they say is the wave of the future. Sure, the CEO will be running the corporation from his picnic table. If he gets an urge to trade a stock at a red light, capabilities are just awesome. You never know when you go trout fishing at that critical moment when you have to make a conference call. I wouldn't dream of climbing Mt. McKinley without my laptop. So as this wireless crap can only be really utilized by a few, therefore the prices of the stuff have to be sky high because they won't be achieving any mass productions of scale. The few who need it will have to carry the whole wireless industry.

This is exactly what was said about "electricity" in the 1920's. It's the new paradyme, electricity!!!!!!!!!! It will revolutionize every aspect of your live. Machines will do all the work. A motor in every device. No more gas powered streetlights. It's all going to electricity. So the valuations of those corporations then were boosted up in everyone's mind because of man's imaginations with electricity. So what is the synergistic effect of B2B commerce with a compounding credit implosion? An explosion is when things blow outward. An implosion is when they collapse inward. Bill owes the bank but can't pay them because he needs to get paid from Sam who needs to get paid from John, but John lost half his money in the stockmarket. So he is pulling all his IRA money out penalty or not. So the mutual funds will be selling to provide for redemptions.

When the market goes down, where does all the money go? Answer. IT NEVER WAS MONEY, only lofty evaluations. So long as only 100,000 shares are sold each day and the buyers want 125,000 shares then the price went up to flush the stock out of tight hands (to get the 25,000 to come up for sale). There is no allowance for the day when we have 75,000 shares sold with not one buyer!!!!! The price will fall until buyers step in. So it is pure supply and demand. Your stock only has value so long as buyers can be found. The liquidity crisis of '98 was when few buyers could be found. Greenspan quickly lowered interest rates to tell buyers of equities "Look we will provide easy cash, I want to encourage you to speculate a little and prop up this market. If one drop in the rates isn't enough then I'll do it until it's low enough for you. Do we have a deal?" He needs to raise rates alot but if he does,then we will have the same crisis. Tokyo is the deciding factor in the game of liquidity. If they sell their US bonds to bailout their banks, then we can't sell many bonds until the Japanese held US bonds are sold. Their ongoing acceptance of US debt has been indexed into the numbers I believe. "They will always buy our bonds". It is like this: As long as we buy all the computer crap and camcorders then they can accept our debt because they have foreign source income (money made from exporting). When we stop buying the gizmos then they will suffer financially and say "Sorry because we have to service our debts we are selling these bonds." Big float needs a home. The foriegn held portion of US debt becomes the pea that needs another shell to hide under. Interest rates went to 20%+ under Carter because he had to go to the capital markets to borrow to pay for the government. The government competed for the available cash by paying a higher rate to get it. Inflation was already running out of control so he couldn't just print more money. It killed business. Exact same thing would happen if the Chinese and/or Japanese decided to sell their portion of US held debt(bonds). How can we sell bonds at the same time everyone else is selling too? This is why we need some one as brilliant as Mr. Greenspan to tweak the system and keep it running. I think as Americans pull redemptions ontheir mutual funds, that foreign investment will rush in to take its place. Why? Because Europe cannot deregulate its markets to spur competition to compete with Asia and the US. They have to keep a weak Euro so they can export. Their educational systems are too vertically integrated to allow for the retraining of mass populations of displaced workers. It's all going to devolve into a socialist nightmare with a rebellion among the overtaxed northern countries. All they can do is take all the little fences and add them to each other to make one big fence around Europe to keep the US and Asia out. Where else can they invest and feel intelligent? We can all look at a few worthless internet companies and see serious valuation problems, but there is no comparison to real American Tech. We put a man on the moon in '68. We don't even care if they steal our technology because they cannot utilize it. We have the computer that designed the computer that built the robot that built the chip that went into the next computer. Great, steal every bit of information Chinese student. You still can't put A to B to C. Build more rockets and mortars. We have lasers.

Where are Asians supposed to invest? They have no SEC that has any teeth. Their economies will crumble if they don't export and the markets are saturated now. American Tech is not internet fizz. You can pull all your money out and foreignors will buy in right behind you. This is still the land of Franklin,Edison,Ford and Einstein. I'm pro-gold and it's not wrong to be realistic. I could not sleep at night going long in equities at this point. I'm saying it is fine if foreignors want to buy US stocks, I still call it tulipmania.
Elwood
(03/07/2000; 21:16:22 MDT - Msg ID: 26512)
Solomon

A carry trade is nothing more than arbitrage in which a person buys in one market and sells in another to earn a spread. It's not necessary to "short" the item being sold in the way we normally think of shorting (selling something you don't yet own). I believe the term "carry trade" is an Asian (Japanese?) translation of what we would call arbitrage.
4Ducat
(03/07/2000; 21:59:04 MDT - Msg ID: 26513)
Hi Al, Goodbye Al. Who relocated GLOBALLY?
http://www.dailyreckoning.comORO's post 26487 exactly right. Above is a link to same trai of thought. Says nations will have to compete with each other for brilliant people who can utilize today's technology and they can live anywhere and still plug-in to the office. This twilight zone has a rainbow for a horizon.
Chris Powell
(03/07/2000; 22:35:11 MDT - Msg ID: 26514)
Midas commentary for March 7
http://www.egroups.com/group/gata/403.html?Latest from GATA Chairman Bill Murphy.

To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
Farfel
(03/07/2000; 23:46:11 MDT - Msg ID: 26515)
Corollary to DOW Carry Trade Hypothesis
The one thing I forgot to mention is this: in light of the continuing divergence in performance between the DOW and NASDAQ, if in fact the DOW is about to serve as the primary source of funds for maintaining NASDAQ verticality, then it is almost inevitable that an internecine war may break out between the two camps of stock investors: the Old Economy DOW investors vs. the New Economy NASDAQ investors.

After all, many investors/funds have enormous positions and much of their wealth tied up in Old Economy stocks. They will not take kindly to being "raided" by NASDAQ funds and investors for the sole sake of maintaining NASDAQ verticality.

One would expect some kind of war between the two camps and if I were to bet on who would win, I would vote for the Old Economy.

Why?

Simply because when it comes to knowing the way around the political landscape, the Old fellas in Old Economy stocks are much more experienced and shrewder than the young pups driving the NASDAQ through the roof.

Imagine what a simple political action INCREASING NASDAQ margins might do to that particular market?

KABOOM!!

Thanks

F*
HI - HAT
(03/08/2000; 03:24:07 MDT - Msg ID: 26516)
BIG OLD MONEY
Follow the money. Ominous signposts. Feds buying in 30 yr. bonds. Big core stocks being liquidated. Conclusion ; elite old money interests heading to bunkers. Their connected advisors know there is no spoon and further there is no soft landing. All outcomes uncertain if markets have to be shut down. The physical gold is noble. Gold is the good.View Yesterday's Discussion.

Henri
(03/08/2000; 05:23:46 MDT - Msg ID: 26517)
Candles in the Rain
http://futures.tradingcharts.com/javachart/GD/40Neat free charts also in non-java format
Cavan Man
(03/08/2000; 06:18:25 MDT - Msg ID: 26518)
http://www.goldensextant.com
Mr. Howe has another commentary posted.
Usul
(03/08/2000; 06:47:01 MDT - Msg ID: 26519)
A journey of a thousand miles begins with a single step
http://www.rain.org/~gadal/Is this our trail?
Simply Me
(03/08/2000; 06:47:32 MDT - Msg ID: 26520)
Internet=Global Economy
And it's only just begun. I have customers in Pago Pago, American Samoa...Athens, Greece...Helsinki, Finland...and various Canadian cities. I've bought from Japan. Not much of what I need coming from other countries. And I expect that if the American dollar were weaker and other currencies stronger I would have a lot more international trade. And here I sit in little ol' Nashville, Tennessee.

Just goes to prove, you don't have to be very smart, or well-connected, or backed by big money to go global these days. All you need is communication and UPS pick-up.

In fact...that may be one of the pieces of the puzzle about why the Big Caps are falling and Nasdaq on the rise. The small, versatile, flexible companies are the wave of the future. Not big clumsy giants. The company that can change their entire inventory, staff, and advertising image in 60 to 90 days is the company that can make the most of society's latest "need-it, want-it, gotta-have-it". Of course, somebody's got to manufacture the stuff to sell. But the analogy still stands...the manufacturers are going to have to be able to switch products pretty fast too. Last year it was Pokemon, the year before it was Furbees. This year it's State Quarter's and stuff to hold the collection...but who knows for how long?

RossL
(03/08/2000; 07:31:11 MDT - Msg ID: 26521)
WSJ Article on gold

The front page of section C in this morning's WSJ has an article on gold. Prepare yourself for a barrage of negativism. Gold is going nowhere according to Peter A. McKay of the Wall Street Journal. And we are now all conspiracy theorists.

Murphy from GATA is quoted, but not until you turn back to page C21 to read the rest of the article. In fact, nothing positive about gold appears on the front page. Only those who bother to find the rest of the story buried in the back will see some semblance of a balanced article.
USAGOLD
(03/08/2000; 08:01:05 MDT - Msg ID: 26522)
Today's Gold Report: Strong Physical Buying Continues on Dips
http://www.usagold.com/Order_Form.html3/7/00 Indications
�Current
�Change
Gold
289.90
+2.00
Silver
5.14
+.03
Gold Lease Rate
0.5700%
nc
Gold Comex Stocks
1,373,896
nc


Market Report (3/8/00): Gold initially fell overseas after the solid
run-up in New York yesterday, then roared back toward the $293 level
pushed by strong physical demand and short covering in London by
investment funds. Echoing our read on the gold market published here
yesterday, FWN reports one London dealer as saying, "There's steady
physical buying in any dip and while technical support exists at the
$288.00 and $281.00 levels I think we would see good buying in between
there." Gold was boosted overnight by the Dow cratering and the
continued rise of oil -- now over $33 per barrel. Standard Bank summed
it up nicely in their report this morning: "The rally in gold and
sell-off in shares was fueled by inflation fears that were fanned by
another increase in oil prices."

We'll leave yesterday's report up for a couple days for newcomers and
those who missed it yesterday.

That's it for today, fellow goldmeisters. See you here tomorrow.

Yesterday's (3/7/00) Report: Gold surged in early New York trading
after a quiet night overseas. Over the past several weeks we have heard
recurring reports from wholesales traders that there is an abundance of
metal on the market. Why then haven't prices reflected the large sales?
Instead gold has hung within a narrow range at one point surging well
over $300. Our view is that demand remains very strong in the physical
market both in the United States and overseas and traders short the
market are forced to square their positions on any significant dips.
Once a downside trading range establishes itself -- buttressed by the
physical buying -- the shorts find themselves forced to cover realizing
that chances are the metal isn't going much lower. We expect this set of
circumstances to dominate market thinking in the weeks and months ahead
as the gold carry trade continues to unwind at the major banks and
brokerages that have fed at the gold loan/forward trough since at least
the mid-1990s. Many prominent gold traders have lost their jobs, if
rumors are to be believed, gold trading departments closed down and
those still hanging on to their jobs wonder what will greet them at
their desk when they arrive at the office in the morning. These are the
aftershocks of the Washington Agreement earthquake which shook the gold
business in late September last year and sent the gold price careening
toward the $350 mark. We believe that those aftershocks will continue
for some time and we could even get another earthquake or two as we go
along through the year 2000. The net result in our opinion will be a
stairstep demarcation to the charts with gold moving steadily upward,
more short players losing their jobs as positions are unwound, investors
steadily acquiring physical metal, and the paper markets steadily but
relentlessly losing volume.

Today's action has all the earmarks of short-covering given the
suddeness of the move -- as if someone lost their nerve. We'll see what
happens as the day progresses. My advice -- cover those shorts; we're
going higher.

That's it for today, fellow goldmeisters. See you here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click on link above and make the appropriate entries.
Cavan Man
(03/08/2000; 08:13:49 MDT - Msg ID: 26523)
Ross L 26521
I'm sure the writer was responding to a request from his editor to write the piece. I am also certain the writer enjoys what he does and where he does it.

I have studied the subject of gold in the context of international monetary and economic discussion here and at other referenced sites (not forums) for almost one year. I have devoted much time and thought to the effort. If only 10% of what I have learned is true, the price of gold should be double what it is today at minimum.

To see an article positioned in the WSJ as you point out tells me loud and clear how very much trouble the international monetary and financial markets must be in. I will buy more gold.

I am lucky to have been Blessed by our Creator with a very good and strong intuition which often compensates for my other shortcomings which are many. I tell you there are treacherous rapids approaching that will unseat many from their canoes. Something is terribly wrong in global financial markets.

Got a floatation device? Got gold?
The Invisible Hand
(03/08/2000; 08:33:40 MDT - Msg ID: 26524)
The inevitability of gold's imminent rise @ Cavan Man (26523)
Cavan Man:

You are writing:
" I have studied the subject of gold in the context of international monetary and economic discussion here and at other referenced sites (not forums) for almost one year. I have devoted much time and thought to the effort. If only 10% of what I have learned is true, the price of gold should be double what it is today at minimum."

Twelve months ago, I held this reasoning for Y2k and concluded that it would lead to a catastrophe.

What do you answer to that?

I'm not criticising you, I have the same reasoning as you concerning gold's future, I just want to avoid the same mistake as I made concerning Y2k (and get rid of all the toilet paper and water I bought - smile).
Hudson
(03/08/2000; 09:12:27 MDT - Msg ID: 26525)
XAU
I am kind of new to this, what exactly is the XAU, how is it tracked, how does it affect gold and why, and where can someone find out where the XAU is speculated to go. Any answer would be helpful , thanks.
schippi
(03/08/2000; 09:55:16 MDT - Msg ID: 26526)
FSAGX Hourly Gold Chart
http://www.SelectSectors.com/agpm70.gifFSAGX moving Up!
Luv_G7
(03/08/2000; 10:06:27 MDT - Msg ID: 26527)
Hudson: Explanation of XAU
The XAU is the Philadelphia Gold & Silver Index, an index of about 10 precious metals stocks. They are mostly large cap stocks. People track the index just like the Dow. It's a weighted index.

What people don't easily understand is that the some of the largest components of this index are in trouble, specifically ABX and ASL. Both of these companies have been hurt by their near-sighted hedge positions. ABX, the largest component of the XAU, is not positioned to share the big gains coming. ABX has sold their future for derivative gains today. ASL is off 70% since their hedge book blew up.

So people who track the XAU are only seeing part of the picture. The gold market is very complex right now. Pure traders like Steve Kaplan, don't look at the inherent problem with the XAU when they make their comments.

The mid-caps and small-caps will see the biggest gains when gold really gets moving. My favorite play is BMG (Battle Mountain Gold) - which is in the XAU. BMG has size and strenght, and is traded on the honorable NYSE. But it's price is still dirt cheap. It's the one stock that has most closely followed gold's gains. It was trading around $25 when gold was healthy, now it's around $2.

I am long on this sector, and have 100% of my money in gold stocks right now. But I only buy the unhedged (or very lightly hedged) ones. Good luck!


Cavan Man
(03/08/2000; 10:07:10 MDT - Msg ID: 26528)
Sir Invisible Hand
That's a very good question. I, like you expected at least some economic disturbance from Y2K and am amazed nothing happened at least not yet. I have asked myself that same question and have also considered that many of the people who post here including myself are deluded and enjoy the benefits of forums like this one because it gives them a venue where they can find people that agree with them for the greater world certainly does not. I even have included the stock market/economic issues/monetary issues on a list with religion and politics as those topics not to be discussed in polite company.

I own gold because of the wisdom and opinions offered by Mike Kosares, FOA and Stranger. MK I have met personally. He is very bright, articulate, knows his subject and market incredibly well and is no Don Quixote. Stranger's credentfials speak for themselves. His perspective is conventional as well as incredibly accurate in my view in assessing inflation and inflationary trends. FOA, well, you either buy off on his analysis or you do not; I DO. There is no middle ground there. His timing is probably off like everybody else but his analysis of past and current events is spot on as they say IMHO. I believe it is the future he projects that causes so much doubt in some people's minds. But, as they say, da nile is not just a river in Egypt.

Let's see, there's John Hathaway, Reg Howe, ORO....well, back to your question. Y2K was a non-event becuase a problem was recognized and remediated. I'd like to see someone address the many economic, monetary and financial issues that are debated here daily and tell us all how these problems are being remediated. They can't.

Can I rest my case? Thank you.
schippi
(03/08/2000; 10:18:37 MDT - Msg ID: 26529)
@Hudson about XAU
http://www.phlx.com/products/xau.html About the XAU:

From http://www.phlx.com/products/xau.html

Gold/Silver Sector (XAU)

The Gold/Silver Sector Index Option is capitalization-weighted and composed of ten widely held companies in
the gold and silver mining industry. The XAU is an American-style option. The exercise settlement value of
XAU is based on the closing prices of the component stocks on the last trading day prior to expiration.


Most Gold investors use it as a proxy for where Gold Stocks are going.
Some Gold mutual funds (eg) FSAGX tract the XAU very closely
but have less variation, and may be easier to use for prediction.

At present if you view the XAU long term ( 10 to 15) years, the
chart shows that we are at a multi year low. It has been lower
but only for a very brief time.

You can generate XAU charts using any of the Web Chart URL's
For the Chart enter, XAU or $XAU or ^XAU depending on
which chart package you use. It is important to get the correct
perspective to view both long and short term charts.
Good Luck!
Schippi

TownCrier
(03/08/2000; 10:18:37 MDT - Msg ID: 26530)
Sir Cavan Man said, "Something is terribly wrong in global financial markets."
http://biz.yahoo.com/rf/000307/bnt.htmlYes. We've (globally speaking) found ourselves to be using the wrong tool for the job for much too long...past the point of diminishing returns and now into negative returns. A prime example from today's news:

HEADLINE: U.S. offers to forgive all Mozambique debt

U.S. SecTreas Lawrence Summers said the amount of U.S. debt held by this former ally of Russia during the Cold War amounted to "a small number of millions" and told reporters "We are prepared to relieve 100 percent of U.S. bilateral debt at the earliest possible multilateral opportunity." It's will be coordinated with other arrangements of international debt-relief.

The SecTreas said, "As well as being a moral imperative, debt relief is a good economic investment for the United States." As the thinking goes, by removing the oppressive burden of debt that is blamed for keeping many countries from pursuing positive steps in economic development, these countries will one day become good customers for U.S. goods and services. Essentially, the official line of thought is 'It is more important to have the American people fully employed in the future than to jeopordize that by insisting that the credit we lent in the past be returned.'

Imagine that you are middle-aged, and you lend your house and retirement savings to another person. Can you imagine a situation where you would prefer to maintain a job with which to try to rebuild your accumulated wealth as an acceptible substitute for the safe return of your original wealth? No, of course not. Why would you want to re-earn that substance which, by contract, should be simply returned to you through no additional effort of your own?

You can see by this that paper credit is clearly recognized by national leaders not to be a form of real, sustaining wealth. If it were, the return of real wealth would be seen as more important than future job security...because the purpose of "jobs" is to create sustaining wealth to begin with. Having real wealth today makes the need for a future job less important...just ask any new lottery winner or person who feels his wealth has brought him to the threshold of retirement. Just as leaders recognize this paper credit (dollars) to be little more than disposable grease for the important wheels of sustainable progress and human development; so should we, too, sooner recognize that our paper is not our meaningful wealth. It is important to recognize that our paper accounts are not worth more than others say it is. To see this, ask, "How highly do I value the Turkish Lira?" So as it is, my friend there, Jocquon, has little power to inspire your assistance or your surrender of goods with the offer of his lira even in large amounts.
Choosing independent and universal gold for meaningful savings is like selecting the right tool for the right job.
**GOLD GOBBLER**
(03/08/2000; 10:23:37 MDT - Msg ID: 26531)
test
test
TownCrier
(03/08/2000; 10:47:10 MDT - Msg ID: 26532)
To what extent can Japan's intervention explain the stall in gold's continued rise?
http://biz.yahoo.com/rf/000308/b8.htmlLast night the Bank of Japan effectively strengthened the dollar in their bid to weaken the yen. Acting through the foreign exchange markets, the BOJ sold yen and bought dollars at the direction of the Japanese Finance Ministry. As you should know and appreciate, these strong dollars help to keep our gold nicely cheap for acquisition during this time.

So why don't the Japanese spread the good vibes to our euro neighbors, too? The euro currency has now reached its new lifetime low against the yen. Reuters reports "The BOJ did directly intervene in defence of the euro on a couple of occasions last year, but the action did not find favour with the European Central Bank, which was keeping a strictly hands off approach to currency management." As you may recognize from past reports, this new euro seems clearly to be a bird of a slightly different feather...and the ECB becomes vexed by a short-term "gift" at another's expense. Their focus seems to be against the "dirty float" in favor of a purely market-driven means of price discovery, even if it means taking some short-term lumps along the way. Kudos.
ss of nep
(03/08/2000; 10:59:24 MDT - Msg ID: 26533)
National Debt
http://www.iht.com/IHT/TODAY/TUE/FIN/yen.2.html
The link is about Japan's Debt.

Are there ANY countries that have NO debt ?




TheStranger
(03/08/2000; 11:06:33 MDT - Msg ID: 26534)
Luv_G7
I know you mean well, but I am afraid you are spreading fiction when you make such remarks as, "[ABX has] been hurt by their near-sighted hedge positions."

Most of ABX's hedges were placed when the POG was about where it is now or higher. Consequently, most can be offset or closed right now at a profit. Furthermore, ABX has the strongest balance sheet in the industry precisely because they foresaw the weak gold market of the last several years and did something about it to protect their stockholders.

In recent weeks, Barrick has publicly stated their belief that the bear market in gold is now over. They have significantly altered their hedgebook in order to benefit from the bull market they see developing. In fact, just last month the company's CEO, Randall Oliphant, told an interviewer he now expects gold to go "higher, a lot higher."

No other company is better positioned to take advantage of this bull market in gold than Barrick, if they want to. They have the wherewithall to close out most of their remaining hedges at a profit if they wish or to start buying other gold mining assets at will.

I don't mean to shout you down, Luv, but this is a forum where people go for guidance about money. I should think some effort should be made to stick to the facts.

Thanks.
lamprey_65
(03/08/2000; 12:12:58 MDT - Msg ID: 26535)
TheStranger and Luv_G7
Stranger - yes, Barrick is NOT in trouble at the moment...that is true. They do have the strongest balance sheet and much of this comes from the fact that they pioneered the idea of extreme (many years out) hedging, and did it in a prolonged bear market. It has been my opinion for some time that Barrick Gold is "tied in" to the forces which drove down the POG since 1996 -- the bullion banks and possibly certain CB's. If you look at the people associated with Barrick (G. Bush, Mulrooney(sp?), V. Jordan, etc.) you can see why they have so much clout it the industry. They are the "tell" for gold producers.

Having said all this, they have delivered very little to their shareholders, and going forward I agree with many that ABX is simply not the best way to play gold equities. The stock has become more of a hedge fund then a true gold producer in that regard. They have, and probably will continue, to underperform even other large producers....and as a simple matter of ethics, I find placing money with them distasteful considering what they've helped bring about in the industry - namely the idea that you can sell forward many years of production to bullion banks who can then keep a lid on prices.

As an aside, I recently sent an email to a gold producer and suggested they form a B2B company, preferrably with other producers, in order to sell their product DIRECTLY to the consumer. I have my doubts whether this industry is savvy enough to see the logic behind this approach, but I did receive a positive reply concerning the idea. We'll see.

Lamprey

JA
(03/08/2000; 12:55:09 MDT - Msg ID: 26536)
Gold Mutual Fund
I have some monies in Fidelity mutual fund from a previous employer of some 20 years ago. I am considering moving these monies to Fidelity Select Gold fund. This fund's top ten holdings are as follows:

Top Ten Holdings as of 12/31/1999
MERIDIAN GOLD INC
NEWCREST MINING LTD
STILLWATER MINING CO
ANGLOGOLD LTD
FREEPORT MCMORAN COPPER CL B
AGNICO-EAGLE MINES LTD
FRANCO NEVADA MINING CORP LTD
PLACER DOME INC
NORMANDY MINING LTD
GOLD FIELDS LTD
62.7% of the portfolio

I would be interested in any thoughts or comments on this fund and it's holdings?
TheStranger
(03/08/2000; 14:25:38 MDT - Msg ID: 26537)
Lamprey
Barrick is a very well capitalized company which produces gold at a lower cost than anybody else. This they have accomplished while numerous competitors have either gone out of business or are, in some cases, "on the ropes". To me, this constitutes protecting the interests of one's shareholders.

While it is true Barrick's hedging contributed to the recent gold bear market, it is not true that it was the essential element in the bear market. Most miners participated in forward sales to one degree or another. All who did were guilty of doing exactly what you and I are guilty of doing, which is trying to time the market. This behavior may seem nefarious to some, but I submit it is precisely what a free market might expect of a commodity which is never used up and always on hand.

Was Barrick's hedging immoral? It certainly would have been had it been kept a secret. But such was not the case.

Is the company in "trouble" as a result of their hedging practices? Absolutely not. Far from it, as a matter of fact. The company has benefited greatly and arguably sidestepped what was a nasty gold bear market.

Why is the stock so low? Largely, I suspect, because it is the whipping boy of every misguided gold investor who has sat on gold the last twenty years and failed to take responsibility for his own losses. Does Barrick deserve this reputation? Probably, but that is not the same as saying they are in trouble.
ORO
(03/08/2000; 14:36:58 MDT - Msg ID: 26538)
Fidelity gold dtock portfolio
Some thoughts:

The Fidelity portfolio has a very good selection of gold stocks that are lightly hedged - some 1/2 are unhedged.

Good beginning.

If you do not have bullion, I suggest that in opening a gold portfolio you start with bullion. Best way to own bullion is to directly hold it physically in small denomination coins 1/5 oz to 1 oz such as to pay minimal premium while focusing on the older gold coins that had high premiums in the past (e.g. Helvetias sold at some point at 60% premiums).

Second best is to open a bullion IRA account at a good local coin dealer, who is sufficiently familliar with them. It is important to establish a good rapor' with the dealer and understand that there is a greater possibility of custodial accounts being raided by the government. Good relations and locality could allow you immediate delivery at the first rumblings of trouble. Have withdrawal forms ready and keep enough dollars to pay most of the early withdrawal penalty.

Third best - E-gold accounts - from which you can obtain delivery for a slightly lower premium than average.

Fourth option Central Fund (CEF) which is 50% silver.

I prefer a gold portfolio with 50% physical.

Gold Stocks - Fidelity is a good fund. I would allocate 25% or somewhat more of a gold portfolio to gold stocks.

Hedges.
Use 5% of your gold portfolio to buy put options on gold. Options should be spread a few months forward at strike prices 5-10% below current prices.
Use 2-4% of your gold portfolio to buy put options on the XAU or on individual gold stocks. ABX NEM and AU are the most liquid options. ABX puts were quite good last October and would have provided more of a hedge than either NEM or AU.

Disclaimer - Do not consider this to be investment advice - you should seek counsel with a trusted advisor who has some experience in the gold markets. This formula is not good for everyone and requires a rather largish initial outlay.
ORO
(03/08/2000; 14:49:32 MDT - Msg ID: 26539)
Rebalancing a gold portfolio
The gold markets can be very volatile and the portfolio should be rebalanced when it is out of kilter, particularly your option hedges and gold stocks.

Rebalancing should be done if put options have more than doubled in market value and are prices are near strike values - sell them and buy lower priced puts at the proportions indicated. Use the cash generated to buy bullion and a bit of it to add to your gold stocks.

Your portfolio hedge is supposed to allow you to accumulate more bullion at lower prices if you happen to miss the boat on the lows.

Keep cash around in your portfolio to buy on the dips.

Disclaimer from previous post holds here as well.
TheStranger
(03/08/2000; 14:59:54 MDT - Msg ID: 26540)
One More Thought On Barrick
I do not wish to be an apologist for this company. Nor do I intend to promote any gold stocks at this very fine USAGOLD site. Rather, I challenged the honorable Sir Luv's statement out of a belief that we who line up in favor of gold ownership ought to stand together. As the noble canamami has said, if we wish to prevail in this crusade, those of us in the stocks and those of us in the bullion ought to learn to appreciate one another. Barrick has chosen now to go "long" the market. As such, I suggest we save our contempt for the real enemy, whoever that may be.
USAGOLD
(03/08/2000; 15:05:37 MDT - Msg ID: 26541)
Interesting Fact....
According to the World Gold Council's Demand Treands #30 released a few weeks ago, the official holdings of gold were 1106.0 million ozs in 1996, and 1080.6 ozs in October, 1999.

In other words, central banks over the past four years have lost in the aggregate a mere 25.4 tons -- or a little over six tons per year.

That after countless mainstream press articles bemoaning the surety of central bank sales, the Bank of England dishoarding, Dutch and Belgian central bank sales, Canadian, Russian, Malaysian , Jordanian sales -- and others.

What the mainstream press fails to point out consistently is that while some central banks have been selling, others must have been buying.

I want to thank my good friend, Voyager, for prompting me on this subject.
Farfel
(03/08/2000; 15:36:38 MDT - Msg ID: 26542)
@THE STRANGER....SELL BARRICK INTO THE GROUND!!!!!!
Unfortunately, I completely disagree with you.

Barrick has created years of misery for the gold industry (excluding itself) and many gold companies, investors, and employees went bankrupt as a result. It's actions back in '96 triggered other major gold companies to follow suit and forward sell huge amounts of gold. But Barrick began the whole rotten process.

It has major negative karma and the executives/owners deserve to rot in hell. Period.

Barrick has NOT gone net long in the gold market either. It's purchase of gold calls is simply a defense mechanism against possible jumps in the POG but there is no evidence it is closing out its gold forward sales. Moreover, when it had the opportunity to spark the gold price higher AFTER the Placer Dome announcement, it failed to do so.

Finally, its investment banker, Goldman Sachs, is a leader of the gold shorting bullion bank pack.

Enough said.

I first wrote about this miserable company in the TORONTO GLOBE AND MAIL back in '97. The company had the audacity to call me up at my home and attempt to intimidate me.

I URGE anybody who wants higher gold prices to BOYCOTT this company in perpetuity. SELL IT!!!

Thanks

F*
Harley Davidson
(03/08/2000; 16:34:20 MDT - Msg ID: 26543)
Farfel, in your message ID:26542 you said...
"I URGE anybody who wants higher gold prices to BOYCOTT this company in perpetuity. SELL IT!!!"

Fidelity seems to agree with you. Around the beginning of the year I believe Barrick constituted the largest percentage of their Gold Portfolio.

As inspector Cleuseau (sp?) would say with his heavy French accent, "Not anymore!"
TheStranger
(03/08/2000; 16:49:56 MDT - Msg ID: 26544)
Farfel
Well, I guess one man's meat is another man's poison. Last December, when you adamantly predicted a quick move to 13,000 by the Dow and to $200 by gold, I thought you yourself were short the PMs. Evidently, I was wrong.

Anyway, I am glad we are on the same side. I just wish you would quit running down one of my investments.

I repeat: Barrick is NOT in trouble. They are arguably the strongest of all the world's gold miners, and they are now leveraged TO the market, not against it. The hype against them may be well-deserved, but it has also created one of the best values in the sector, IMO.
Peace, Brother.

Harley Davidson
(03/08/2000; 17:01:04 MDT - Msg ID: 26545)
A couple items worth noting:
If any of you don't read Fleckenstein's Rap page, here is what he said tonight regarding the Crude Meister:
"Crude takes a hit... Overnight, the API statistics came out and there was a surprising build in crude. Industry experts that I talked to were somewhat skeptical of it and thought it might be more political in nature."

Hmmm...

Also, in looking at the DOW, since its high in January there have been five selloffs, each followed by a modest retracement. While I'm no chartist, what I gather from this pattern is 1. today's uptick was to be anticipated and 2. more importantly, the direction since the high continues to be a steep decline.
Farfel
(03/08/2000; 17:37:02 MDT - Msg ID: 26546)
@THE STRANGER - My few remaining gold positions are frozen.
And I have not increased them a single dollar in well over a year. In that sense, I stand on the sidelines.

My most pessimistic predictions about gold and insanely maniacal predictions about the stock market occurred BEFORE the Washington Agreement was announced.

After the Agreement, I became more optimistic about gold, yet remain convinced that the gold market is NOT a market yet. In reality, it is a de facto private banking account set up by the bullion banks/gold hedgers to which gold "investors" make donations under the erroneous assumptions that there is a free market there.

So I remain on the sidelines doing absolutely nothing with my money except collecting interest.

In my heart, I remain a goldbug, although NOT a fan of gold companies, if you can understand the distinction. I am particularly unhappy with certain gold companies and their notably incompetent unethical managements.

I am particularly negative toward Barrick and will remain so ad infinitum. Barrick and its gold shorting conspirators hurt me financially to a great degree and of course I hurt myself in my erroneous beliefs in a free gold market.

We absolutely do not have one and until we do, I can root for gold but I refuse to participate any longer. When and if I see evidence that the so-called gold market is a market again and not simply a carry trade designed to STEAL money from naive gold "investors" foolish enough to believe in the integrity of the COMEX, then and only then will I move money into gold again.

Thanks

F*
dragonfly
(03/08/2000; 17:49:09 MDT - Msg ID: 26547)
Peter Asher (msg id 26348 - 3/3/2000)
Peter I agree with you. Especially that <<"Hard assets will continue to store value long after a future society that has learned that speculative profiteering is as counter-survival to the common good as rape, pillage and burn. All profiteering dilutes the amount of goods and services that are available to be exchanged for the labor of the true producers." Well said! The poem brought back memories of an old friend who grew up in Istanbul, when they called it Constantinople. He recited that John Donne poem every time we got together to ponder the world. Thanks.
oldgold
(03/08/2000; 17:57:55 MDT - Msg ID: 26548)
Stranger
You say ABX now believes we are on the verge of a gold bull market. If so then why do they not start to buy back their hedges instead of purchasing gold calls? Buying back hedges or at least delivering into the hedge book would do a lot more for POG than purchasing gold calls. Could it be that their hedge position is too big to cover?

JA
(03/08/2000; 17:59:30 MDT - Msg ID: 26549)
ORO
Thanks for sharing your thoughts. It made me do a quick analysis of where my assets are currently invested and it was kind of an eye opener.

Real Estate 42%
Fixed Income 33% - 401K monies, Limited options and I am leery of both Stocks and Bonds currently
Equities 13% - mostly in and international fund that was up 64% last year.
Gold & Silver Stocks 6%
Gold & Silver Bullion 6%
Gold Options 1%
Gold mining Claims ? may potentially be worth more than all of the above.

1. For as much time as I spend reading and thinking about gold, I am a little surprised my total gold investment percentage was not higher. It turns out that my gold investments are currently approximately 50% bullion and 50% Stocks. I have never hedged my gold investments, I have mainly held and wept and tried to buy more on the dips. Currently my gold options are calls not puts. I may have to give more thought to hedging.
2. The majority of my assets are not doing much for me other than the real estate is paid off and thus provides some comfort. I suppose similar to what gold coins do for Aristotle. The fixed income has me befuddled because it just sits there, and should the dollar tank I don't know that it would buy much of real value. Stranger did make me feel a little better a week or so ago when the one measure of a broad market top occurred in April 1998. That's when I moved most of my 401K monies out of equities. I have been kicking myself off and on ever since. Recent action in the equities markets is making me feel a little better.
3. Should the price of gold double from today's levels as some at this site are suggesting, I may be tempted to quit my day job and spend my time and effort working the mining claims.


I figure I gain much from my visits to this site and appreciate the efforts you make to assist in my education.
schippi
(03/08/2000; 18:07:32 MDT - Msg ID: 26550)
@JA Gold Funds
http://www.SelectSectors.com JA check out above URL for Charts and info
on FSAGX Gold Fund.
Hill Billy Mitchell
(03/08/2000; 18:08:12 MDT - Msg ID: 26551)
Dollar carry trade
Boy am I ever glad we don't worry about the big guys switching to a "dollar carry trade".

They couldn't could they.

They wouldn't would they.

Is it possible? Surely not!

hbm
Hill Billy Mitchell
(03/08/2000; 18:17:02 MDT - Msg ID: 26552)
Euro carry trade
What a scary thing if next in line were a "Euro carry trade"
because it would be more of a credible possiblity.

If it would be a possibility we who follow the footsteps of Giants could get really smashed when the giant steps backwards.

hbm
Hill Billy Mitchell
(03/08/2000; 18:37:11 MDT - Msg ID: 26553)
Fleckenstein on oil and gold
Fleckenstein says, "Oil hurts gold......The setback in crude knocked gold for about $3, and that caused the XAU to give bck about two-thirds of its gains from yeaterday."

It appears that the real concern has to do with the price inflation caused by increased fuel costs. The real fear is and always be eventual price inflation which is what is required to cause the price of gold to go up, up, and away in the US.

hbm
Hill Billy Mitchell
(03/08/2000; 18:46:37 MDT - Msg ID: 26554)
Oil volatility
Has any noticed that the creeping price of crude went to another level yesterday and today. We haven't seen that kind of volatility in oil. It had a similar effect on gold each day. We should watch this, no?

hbm
TheStranger
(03/08/2000; 19:03:38 MDT - Msg ID: 26555)
Farfel and oldgold
Farfel - thanks for your response.

oldgold - among my apparent idiosyncracies is a strong sketicism toward claims that the world is about to become desperately short of deliverable gold. You may, of course, not share my views on this question. But I think the theory flies in the face of all human experience with marketplace dynamics. There is, in my opinion, always a price at which markets clear, however high or low it may be. Failure to appreciate this reality may explain the ready acceptance with which some PM stalwarts have treated astronomical price predictions for gold. I don't know.

But, to address your questions more specifically, you may wish to reread the explanations given by Barrick themselves in their news releases of Feb.7 and 8, 2000. The releases are available in PDF at www.barrick.com.

Hill Billy Mitchell
(03/08/2000; 19:08:22 MDT - Msg ID: 26556)
Cost of gold in Euros
On January 1, 1999 1 Euro would buy about $1.17. Today(22 months later)1 Euro will buy about $0.96. I believe that the spot price of Gold was about $290 then as it is now. That means that the price of gold for those who have as their national currency Euros has risen to the equivalent of approximately $354 in terms of their currency (22%).

If you were holding physical gold in Euroland would you want the US $ to tank. I think not. For the Euro gold bugs they must bet on the future worthlessness of the Euro or at least the strength of the US $ vs. the Euro as long as gold is priced in Dollars world-wide.

From this it seems to me that the Euro goldbugs would want quite a different scenerio from what we US goldbugs want. Whether we admit it or not a strong US dollar is anathema to us goldbugs.

Of course those who are at war with the US dollar and using the Euro as their weapon to do battle are not goldbugs at all. They simply realize that a Euro backed by gold is the answer to victory.

hbm
Hill Billy Mitchell
(03/08/2000; 19:35:29 MDT - Msg ID: 26557)
The cost of one ounce of gold in Euros
I should make a clearer statement concerning the cost of gold in Euros:

If Gold is @ $290 and the Euro will buy $1.17 then one ounce of gold costs $248 Euros.

If Gold is @ $290 and the Euro will buy $.96 then one ounce of gold costs $302 Euros.

In other words while the price in gold for us has not changed for us it has gone up by 22% in terms of Euros.

This should at least show us that others in this world view the current situation quite differently from us.

Any comments?

hmb

ps: re: #26556 I should have said 14 months later not 22 months later. Sorry!
Chris Powell
(03/08/2000; 20:17:20 MDT - Msg ID: 26558)
Wall Street Journal asks why gold isn't higher
http://www.egroups.com/group/gata/404.html?Latest from GATA.

To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
Dollar Bill
(03/08/2000; 20:57:04 MDT - Msg ID: 26559)
Farfel
"The Fed is controlling only a portion of the money/credit creation mechanism. The ability of today's non-bank institutions to create credit is without precedent in modern times."
"If Greenspan tried to change margin requirements, the "big boys" can go offshore for money."
"There is little fear among banks that the Fed will change banks lending activities related to securities lending and maximization of lending relative to total capital is the order of the day." Tice commentary from today

The gold boys you mention are doing what you say, but cracks in the foundation are being made as we type because of the credit bubble. Which is not remedied by a stock market decrease.
At least two battering rams are at work, the front door Gata approach which I fear, and the credit bubble which I fear more. Either way, gold's day is coming:)
JA
(03/08/2000; 21:12:56 MDT - Msg ID: 26560)
Schippi
Thanks for sharing the site.
TownCrier
(03/08/2000; 21:51:13 MDT - Msg ID: 26561)
Fed adds $5.55 billion to the banking system
http://www.usagold.com/wgc.htmlOn this last day of the two-week reserve-maintenance period, the Fed boosted the values for the weighted average with an overnight add of $5.55 billion today.

On another note, this is a convenient opportunity to pass along a quick reminder that the weekly gold market commentary provided by the WGC is updated weekly (oddly enough), and may be viewed at the link above.
The Invisible Hand
(03/08/2000; 23:00:08 MDT - Msg ID: 26562)
remediation of Y2k vs remediation economic,financial and monettary problems
Sir Cavan Man,

Thank you for your answer
"Y2K was a non-event becuase a problem was recognized and remediated. I'd like to see someone address the many economic, monetary and financial issues that are debated here daily and tell us all how these problems are being remediated. They can't."

Your case has been very well outlined in 26523 and 26528 and you can rest it now.
SteveH
(03/08/2000; 23:51:33 MDT - Msg ID: 26563)
protecting gold
Seven paradoxes of gun control

Dr. Michael S. Brown
SPECIAL TO WORLD TRIBUNE.COM
Thursday, March 9, 2000

Few public policy discussions have become so bitter and divisive as the endless debate over guns. None is so burdened with contradictions and misinformation. The dictionary defines a paradox as, "something or someone with seemingly contradictory qualities or phases". Here are seven paradoxes that have developed during the course of this conflict:

1. Women are usually at a physical disadvantage when confronted by a male attacker and violence against women has been a major societal issue. Some women have discovered that a firearm combined with training is a true equalizer. They have taken steps to educate themselves and safely provide for their own security. However, many women reject this opportunity. They seem to accept the concept that guns are evil and promote violence. Thus, those who could benefit most from gun ownership are least likely to own one.

2. Police Chiefs are famous for blaming crime on "guns flooding the streets", and generally support more gun control. However, rank and file police officers are overwhelmingly opposed to stricter laws. Why the disagreement? Most Police Chiefs are political appointees selected by the Mayor. Most Mayors favor stricter gun laws and would be unlikely to choose or keep a Chief who disagreed. Officers who work on the streets are much more practical. They know they can't be everywhere at once and are usually limited to processing crimes after they have occurred. Unlike the Chiefs who are surrounded by tight security and VIPs, officers who work on the streets know all too well what the world is like for the rest of us.

3. Celebrities and politicians who promote gun control are the ones who don't need to protect themselves. They have access to the best bodyguards that money can buy. Even if the strictest imaginable gun laws are enacted, they will still be protected by armed men.

4. As a result of state laws passed in recent decades, citizens in 31 states are now entitled to concealed weapons permits if they have a clean record and fulfill various requirements. Data gained from this change has provided important new knowledge for gun law discussions. To the great surprise of anti_gun groups, it turns out that permit holders are far less violent than the general population. Even more significant is the fact that crime decreased in the areas where permits were made available. As one researcher put it, "more guns, less crime".

5. Criminals victimize minorities at a much higher rate than the general population, yet many gun control efforts such as buy_backs and neighborhood sweeps of low income areas are aimed at reducing gun ownership by minorities. This paradox has operated as long as human history. Immigrants, political dissenters and ethnic minorities have been disarmed many times by governments seeking to bring them under tighter control. They are always told that its for their own good.

6. The position that gun issues have assumed in the political spectrum creates a very interesting and hotly debated paradox. Liberals, who defend the right of a woman to have an abortion, would deny her the use of a firearm to protect herself and her family. Conservatives, who typically support a woman's right to kill an attacker, would deny her the right to terminate a pregnancy. Both sides base their arguments on the sanctity of life.

7. The seventh paradox is the most profound. Gun control simply does not work as crime control. Case after case shows that when cities, states and nations implement gun control, crime goes up. Washington, Chicago, New York, Australia, Britain; the list is long and getting longer as the seductive appeal of gun control spreads. The reason that gun control doesn't work is obvious, but often ignored in the emotional rush to pass more gun laws. Criminologists explain that disarming the law_abiding population only makes life easier for criminals who are going to ignore the law anyway.

No other major political issue is so plagued by paradoxes. They arise from a variety of sources that could serve as a list of societal ailments; racism, sexism, classism, political corruption, excessive media influence, fear of the unknown, and honest disagreement.

Whichever side you choose to support, it is fascinating to observe the debate.

The author is an optometrist who moderates an email list for discussion of gun issues in Washington State. He may be contacted by email at: mb@e_z.net. c


Friday, March 9, 2000
SteveH
(03/09/2000; 01:32:21 MDT - Msg ID: 26564)
Liberty and Public Health
Liberty in the US is guaranteed in writing by the US Constitution's Bill
of Rights. Today, the greatest enemy to liberty is Public Health. Why?

Because there is a cost to liberty in lives. Where public health sees a
cost in lives, it moves in to restrict that activity. Take for example:

Cigarette law suits Motorcycle helmet laws Car safety belt laws Gun
lawsuits and Gun manufacturer law suits

Let's come back to the above in a moment. First, let's talk about why
the Founding members of the US sought to guarantee liberty by the Bill
of Rights. In a nutshell, they were taxed without representation, run by
a country from a far, who sought to enslave them, who sought to disarm
them.

In return for doing that the US revolted and wrote the document we all
studied in school but since put out of mind: the Constitution and the
Bill of Rights. They were not written at the same time. Two camps
existed back then on exactly what the new Government should be allowed
to do. In the end, the Bill of Rights were incorporated into the
Constitution to prevent the new government from becoming the government
that they just took the time to overthrow. Seems simple enough.

Back then they didn't have Corporations, lobbyists, public health
organizations, or mass news media who could talk at you in your living
room within minutes of an event taking place. What media they did have
was owned by many different people of all backgrounds. Today, media is
owned by fewer people who realize their power to persuade and choose to
do so in ways that suit their fancy and not always ours.

So, the Constitution and the Bill of Rights that were written back in
the late 70's and 80's (1700's that is) have stood surprisingly well to
the test of time. Yet, this is not entirely true. It seems that some
organizations, using public health as the reason, have decided that
certain public actions warrant restricting liberty, even ones that are
guaranteed by the Bill of Rights.

Specifically, certain very well-funded organizations have decided that
it is important that Americans should not have guns in the home,
especially homes with children. There reason is because every day
children are harmed or killed by guns in the home. There logic is
simple. Guns kill children, let's kill guns. This worked with
cigarettes, and those other things above. Cigarettes kill people, let's
kill cigarettes. Not using seat belts kills people so let's kill not
wearing seat belts. Not wearing motorcycle helmets kills people, so
let's make people wear helmets.

Everyone, including me, were glad to see cigarettes banned from
restaurants. I can remember the smell, the smoke, the clothes, the
burning eyes. I felt bad for the smoker, but let's get real. But, now I
look back in retrospect, and see that a whole way of life going back
hundreds of years, was wiped out by lawyers going after cigarettes and
the media going after smoking and smokers. The change was subtle and
slow, but they did it. Cigarettes are still there but not nearly what it
used to be.

So, American's were willing to accept the destruction of an entire
industry for Public Health reasons? Seems that way. Sure proves my point
though. Public health is dangerous to liberty, even liberties that are
dangerous to the person enjoying them.

Is it possible that Public Health can go too far? Oh, yes. I believe
this is the case with gun control. What is obvious to me and perhaps you
now, is that there is a difference between gun control and these other
areas of public safety. Gun control is stepping on a liberty and a
right, whereas these other areas of seat belts, cigarettes, and helmets,
are certainly liberties, can they actually be called individual rights
guaranteed by the Constitution?

Obviously the pursuit of happiness has limitations. Limitations set by
Public Health. But back to gun control. The meaning of the Second
Amendment is hotly debated and from memory states, "A well-regulated
militia, being necessary to a free state, the right of the people to
keep and bear arms shall not be infringed." What does this really mean?

Courts have gotten it mostly wrong. To make matters worse, the Second
Amendment hasn't been deemed protected by the 14th Amendment like all
the rest of the individual rights in the Bill of Rights. That said,
however, doesn't mean that the courts won't get it right eventually, nor
that some case won't be won that does ultimately get the Second
Amendment to pass through to the states.

Before discussing the specific historical meaning of the Second
Amendment, we must first understand whose job it is to ensure that it is
protected. The Congress is the one most affected by the Bill of Rights.
It is the legislatures primary job to ensure they don't pass laws that
infringe on the Bill of Rights. Law enforcement also needs to make sure
they support and defend the constitution (Miranda, civil rights, search
and seizure). Finally the courts need to perform judicial construction
on laws that are unclear in their constitutionality, which also means
that when the legislature passes a law, it must go out of its way to
make sure it is clear. Finally, the courts assume that a law is
constitutional unless it is blatantly not constitutional. So, clearly,
the onus is on the legislature to make sure laws meet Constitutional
muster before passing them. (Because it is so hard to get it right if
they get it wrong)

Now, back to the historical meaning of the Second Amendment. When a
court rules on the meaning of a law or a right, they often must go back
to understand the meaning the law or right had back at the time it was
created. In the case of the Second Amendment, that is quite easy, but
requires a lot of reading. Since I have taken the time to do some of
that reading, I can save everyone lots of time and simply state: the
Second Amendment meant what it said. The problem is the words the
founders used have changed slightly in today's meaning and thus lies the
confusion.

We can dispel with the confusion from this point forward: the Second
Amendment means that the individual has a right to keep and bear arms as
an individual and fundamental right to protect one's personal security
and security of the state and country. In order to accomplish this, the
concept of a well-regulated militia must be maintained. A well-regulated
militia, which is different from a select militia (national guard and
reserve), is the whole body of people in the United States. In other
words, every person in the US is a member of the well-regulated militia.
The well-regulated militia is every person in the US. Every person in
the US has the right to keep and bear arms. Why?

Because our founders lived in a time when the government they started
with, tried to control their guns, they then tried to take them away. As
they took them away, they tried to take other rights later. Guns were
considered by our founders to be the guarantee of liberty and all the
other rights they were willing to die for.

Congress's job is to ensure that this right will not be infringed. Have
they done a good job?

No. Have the courts done a good job of not infringing on the Second
Amendment? No. Has law enforcement done a good job of not infringing on
the Second Amendment? No. Does Public Health infringe on the Second
Amendment? Yes. Why?

Public Health, as we discussed, views guns as a health risk to children.
In their view, it is the same as seat belts, tobacco, and helmets. It
can and must be legislated or curtailed, in their opinion. After all, we
have the police to guarantee our safety, what do people need guns for?
After all, children are killing children, people are killing children.
We must ban all guns to protect our children. Stop.

America is about personal responsibility, it is about choice, it is
about Liberty and Rights. Liberty and rights have a price in lives.
Since the Second Amendment was guaranteed in writing by the founders to
protect liberty and the other rights, what would be the cost of giving
in to a misplaced Public Health movement to infringe guns, and a
Congress that is allowing that to happen, and a legal entanglement that
will take the courts years to unwind? The cost will be more lives. That
is correct.

History has shown that in all societies that have given up their right
to protect their liberties and rights with guns, the cost of lives was
in the millions. So, if the politicians can't admit it out loud, I shall
do it for them. The ultimate cost of gun control will be millions of
lives and not just the few children that could be potentially saved if
all hand guns, rifles, were removed from homes, cars, works. Why?

Going back to the basic premise of the Second Amendment, it is to
protect other liberties, to protect the people from their own
government, from their fellow citizens run amuck, from other countries,
to act as a deterrent against invasion. The founding fathers wanted all
children to be taught about the proper use and maintenance of guns. They
sought to protect that in the Bill of Rights. They didn't want their new
Government to infringe on the right of the people to keep and bear arms.
Yet every day there are more laws passed, more infringement. Why?
Because Public Health restricts liberties by taking away rights for the
common good. It won't work with the Second Amendment and guns. Why not?

It is simple. It is a practical matter and a philosophical matter.
Practically speaking, in order to prevent the 1500 accidental deaths of
children each year from gun accidents, all guns must be removed from the
homes. If people merely put gun locks on all guns at home, the 1500
children saved by all gun locks would cost 10's of thousand in
additional lives per year from law-abiding citizens who couldn't get to
a gun to protect themselves. If there were no guns in the home, this
would be absolutely contrary to the purpose of the Second Amendment that
our founders would roll over in their graves with disdain.

Philosophically, America would not be American without the
well-regulated militia. That is all the people trained to arms, with the
right to keep them and bear them. Giving up hand guns or rifles or one
or the other is tantamount to the same thing. We need to protect our
right to keep and bear arms from infringement by Public Health. Because
in this case they have it all wrong. For the short term gain in saving
children's lives today, it will cost American what it is, and ultimately
pave the way to the loss of millions of lives because Public Health will
create an America that won't be a strong supporter of liberty and of
rights. In other words, to save 1500 children we must loose what America
is. Liberty cost lives. Public Health needs to work with American's to
educate children and families on gun safety. They must stop the unwanted
attacks on American's with the false pretense of saving lives.

Put this in perspective:

Deaths due to medical malpractice over 100K per year
Deaths due to automobile accidents over 25K per year
Deaths due to accidental shootings of children less than 1600 per year

Just how important is for Americans to remain patriotic to the goals and
aspirations of our founding fathers to maintain that well-regulated
militia of men and women trained to arms from an early age so that no
faction from with this country or from without will dare tread on
America? In my opinion, it is vital to the security of this country that
we remain true to the Bill of Rights, and that means all of them,
including the Second Amendment, which is the ultimate protection against
tyranny from within or from without. Liberty cost lives. Not that we
can't try to reduce this, but ultimately we must get it right. Public
Health is not a reason to infringe the right to keep and bear arms.
Congress must put a stop to the misinformation and unwanted infringement
against the Second Amendment now.

Are you going to let the public health movement to ban all guns from
homes to save 1500 lives, cost you your freedom to protect yourself from
criminals or from other countries? Are you going to allow the saving of
1500 lives of children to cost 10's or 100's of thousand in lives of
people who no longer can protect themselves because only the criminals
have guns? You decide. But ask yourself why CNN, CNBC, and the rest of
the mass media all are 10:1 in stories against guns. Why does the media
not see the big picture that our founders saw? Why can't they see that
by using their wide powers of influence against guns that they are
acting against our founders wishes, which makes them public enemy number
one? Remind yourself next time you watch the news and see a negative gun
story that the station running it is likely harming this country because
they are being biased and short-sighted. The media and public health
needs to remember why they have the right to say what they do is
protected by the Second Amendment (yes, the 1st is protected by the 2nd,
How ironic).
View Yesterday's Discussion.

nickel62
(03/09/2000; 02:58:21 MDT - Msg ID: 26565)
Steve H I enjoyed your post on the Second Amendment and the need to protect it.
It occurred to me as I was reading you piece that just as the right to own a gun is a protection of our liberty , the right to own gold is as well.
nickel62
(03/09/2000; 03:43:13 MDT - Msg ID: 26566)
Stranger I think you should take a much harder look at Barricks hedge book
You stated yesterday"No other company is better positioned to take advantage of this bull market in gold than Barrick, if they want to. They have the wherewithall to close out most of their remaining hedges at a profit if they wish or to start buying other gold mining assets at will." Barrick had roughly 12 million ounces hedged forward and an additional 4-5 million ounces worth of calls they had sold coming into their early february announcement of their change. There current production is around 3.2 million ounces so prior to the end of last year they were in a situation where they needed to produce for the next 4 to 5 years to deliver on their existing already sold gold hedges. So effectively their "price" was already guranteed and actually sitting in their money market accounts earning the contango. As a stock investor you know that any change in earnings that is more than five years out has very little impact on the actual net present value of a company because of the effect of discounting so ABX is dead in the water because it has little ability to participate in much upside if the gold price were to move higher. At least little upside that the market doesn't already know about. Now granted with the buying of a large call position with a $319 average strike price they have papered over part of their gold physical short with a paper long call and as long as the counterparty is able to deliver they will have minimized their short and therefore given their shareholders more exposure to the long side of a gold increase in value. But this begs the question about why they had to use paper calls unless they knew they couldn't buy that much physical to retire their shorts and in fact didn't want to because they knew if they did it would set off a market swueeze what with Ashanti,Cambior and many Austrailians strung out already.
So just as an investor why would you want to own a share in a company who has total costs of about $305/ounce not the cash costs of $175/ounce they tout. Yes that is right $305. Hedging when the current cost of buying!!!! their gold hedges back is still below their full all in cost and they are not doing it. To understand the difference between the often quoted cash costs and the $305/ounce that I am quoting for Barrick it is necessary to use a little brutal common sense and remember all these miners have always wanted to talk about how low their cost of production are. Well obviously the cash cost doesn't include the cost of acquiring the property or of exploration or of depreciation so that added back brings us up very significantly for the quoted cost of all mining companies not just Barrick. But the real bottom line is take the total number of ounces produced and divide it into the net profits of Barrick and then subtract this number from the quoted average realized sale price per ounce and whamo! you come up with $305/ounce for Barrick as of last year end not the much lower numbers you hear all miners quoting. This very simple and straight forward approach will drive accountants and gold mining executives crazy but it shows all the cost of the entire operation included into the cost per ounce of the only net product they produce and is very enlightening in its clarity of statement. In other words the management can't bullshit the shareholders into believing that they are producing at much lower levels. The other numbers such as cash cost and all in cost are valuable accounting measurements to do marginal analysis and to run a mine or business but from a providor of capital point of veiw the only real number that counts is the true net profit divided by the number of ounces produced. All the corporate expenses after all need to be carried by each on of those 3.2 million ounces since they don't make anything else. Why don't they talk about that? Because it would be obvious that they are selling gold short not only below the average cost of the industries true cost to produce it but their own as well. Appropriate perhaps for members of a conspiracy but ridiculous for the management of a company that is supposedly responsible for shareholder return on capital. So rethink your positon because they are maybe less culpable than some of us think but they sure as hell aren't looking out for their own shareholders.

Canuck
(03/09/2000; 05:11:36 MDT - Msg ID: 26567)
@ Invisible Hand @ Cavan Man
Re: Your discussion yesterday

Re: "Twelve months ago, I held this reasoning for Y2k and concluded that it would lead to a catastrophe."
------------------------------------------------

I bought into the Y2K concept fairly big time; I have 'unwound' my position since. I am not confident we are out the 'Y2K woods' yet. I have a couple of questions/thoughts; maybe you guys can offer a comment.

I read recently a post from an engineer stating the oil industry (in particular refineries) do their annual maintenance in the spring (April/May) and this traditionally involves a shutdown. He said something to the effect of , "... these plants are going to have problems comong back up with dates of 19100...." In my personal experiences (telephone, IVR/voicemail) we lost a few systems over the rollover; dates of 1980 or 19100. Repair was simple due to the simplicity of the system. I can say Y2K was really, there is absolutely no debate on this. My question is then, is Y2K done? I feel many systems, sub-systems have not encountered the rollover (boot/date/etc.)

Thoughts?

The recent producer pledge of reducing hedges has brought a question to my mind. With BOE auction #5 at the doorstep (March 21) is this a golden opportunity for the mining companies to put 'money' where their 'mouth' is? If there is an opportunity to close hedges, 'unwind' shorts, do you feel a severe 'over-bid' at BOE #5. Please recall BOE #4 at a bid ratio (I forget the commomly used term; oversubscribe?) of 2.1. Do you feel that if the miners, ie. Placer, Anglo, Normandy, et al REALLY intend to cover then
we may encounter a high bid ratio/bid subscribtion???
As a sidenote, I believe we are at nearend of the 400 tonne allotment of the Wash.Agree. are we not? There is plenty of talk of metal shortage, does this not re-inforce my thought of fireworks March 21/BOE #5?

Thoughts? Comments?

TIA,

Canuck
The Invisible Hand
(03/09/2000; 05:37:45 MDT - Msg ID: 26568)
Victory is ours!
http://www.wnd.com/page2.shtmlWorldNetDaily quotes Crudele article on CPI manipulation
Zenidea
(03/09/2000; 05:39:12 MDT - Msg ID: 26569)
Gold and Ghost .
gidday mates ! love yaz !.
dragonfly
(03/09/2000; 05:41:09 MDT - Msg ID: 26570)
SteveH
Great post Steve. You are on to something big. Allow me to recommend a book called "Racial Hygiene - Medicine Under the Nazis" by Robert N. Proctor. One quote should make the connection : "In an early speech before the National Socialist Physician's League, he {Hitler} argued that he could, if need be, do without lawyers, engineers, and builders, but that "you, you National Socialist doctors, I cannot do without you for a single day, not a single hour. If not for you, if you fail me, then all is lost. For what good are our struggles, if the health of our people is in danger?""

SteveH
(03/09/2000; 06:11:11 MDT - Msg ID: 26571)
Nickle62 and Dragonfly
Thanks.

There is a direct correlation to illegal searches and seizures -- something gold is subject to (and was when, I believe, they locked down safety deposit boxes in the 30's), especially were it to rise dramatically -- and the Second amendment.

Public health has a dark side. Liberty is more costly in lives than a well-regulated society. In short, a well-regulated militia is more costly than a well-regulated society. But, our country was signed up for the well-regulated militia. So why all of sudden is public health more important than something we have lived with for 225 years? Public health has crossed into the darkness when it comes to the Second Amendment. This is treason with a reason, but treason nonetheless -- a most unpatriotic phenomena couched in the public interest, but reminiscent of a life-costly past. Stop the nonsense now.
The Invisible Hand
(03/09/2000; 06:18:33 MDT - Msg ID: 26572)
Y2K silence @ Canuck
Sir Canuck:

Y2k guru Peter de JAGER suggested in 1997 to read Tony COLLINS and David BICKNELL, "Crash - Ten easy ways to avoid a computer disaster", Simon & Schuster, 1997.

It states on p.14:
" when a bridge collapses it is not something that can be covered up, especially if it is carrying people. Many bridges have collapsed in history. In contrast, the computer industry has had only a few decades to learn from its mistakes. And it seems to learn little or nothing because silence usually follows a computer disaster."

Has this been suspended by Y2K through the intervention of Adam Smith's invisible hand (not me)?

And what about BROOKS' law?

" Adding manpower to a late software project makes it later.
This then is the demythologizing of the man-month: the number of months of a project depends upon its sequential constraints. The maximum number of men depends upon the number of independent subtasks. From these two quantities one can derive schedules using fewer men and more months. (The only risk is product obsolescence.) One cannot, however, get workable schedules using more men and fewer months. More software projects have gone awry for lack of calendar time than for all other causes combined."
(BROOKS, F.P. Jr., The Mythical Man-Month - Essays on Software Engineering,Addison-Wesley, 1995 Anniversary edition, p.25)

Did Y2K conversion start on time?

By the way, why is oil (a product from the old economy) rising and can't the producers (agree to) increase production?
HI - HAT
(03/09/2000; 06:35:57 MDT - Msg ID: 26573)
VIRTUE
Nothing is ever new under the sun. Machiavelli distilled down into its essence the balance a prince ( government ) ,must strike to perpetuate a legitamate virtuous governing. This being the agreed upon laws and premises being adhered to from top to bottom by all, so as to promote the free and fair general welfare of all the people. We are no longer a virtuous people. We have at our head an abstract national security state mentallity that is most probably fundamentally insane. They have de based de frauded de spoiled. These are thugs who are in fact true anarchists. What we have here is kind old uncle sam doting on the customers out front in the candy store while in the back room all his relitives are engaged in rachets and every concievable con game. I weep and live in fear for our country. Aside from trying to live the golden rule as best I can having real gold in hand is an expression of earths cocentrated natural virtue.
TheStranger
(03/09/2000; 07:28:05 MDT - Msg ID: 26574)
Nickel
I didn't expect my remarks to go unchallenged, but I stand by them none the less. I understand and agree with your argument that stated production costs do not reflect all expenses and thereby fail to square with the bottom line. But that is true of all mining companies and does not impugn Barrick's competitive cost advantage.

It is impossible for me to represent Barrick's hedgebook accurately because it can change day to day and frequently does. I can only do what you can do which is read the company's public releases carefully and trust that management is smart enough not to risk jail by deliberately misleading the public. Having done that, I am convinced that Barrick's upside for the next several years is unlimited with gold anywhere below about $600. What happens beyond that would depend largely upon what the company does in the meantime.

Meanwhile, the company is quite sound and is one of the very few with capitalization large enough to attract institutional interest should the bull market in gold continue.

One thing nice about bullion is one doesn't have to worry about all this stuff.

Thanks.
Henri
(03/09/2000; 07:38:16 MDT - Msg ID: 26575)
HI-HAT and SteveH
Hi-Hat, I am a great fan of Nicolo's and I believe the founding fathers were as well. He traced the fall of the Roman Empire to the disarmament of its citizenry. "..[I]t is certain that no subjects or citizens, when legally armed and kept in due order by their masters, ever did the least mischief to any state...Rome remained free for four hundred years and Sparta eight hundred, although their citizens were armed all that time; but many other states that have been disarmed have lost their liberties in less than forty years." (Discourses-1525?)

SteveH - Great Post Public Health advocates are often blinded by their own good intentions, they too are social justice advocates in principle.
USAGOLD
(03/09/2000; 07:55:22 MDT - Msg ID: 26576)
Today's Gold Report: Gold Up; Heads Will Roll
http://www.usagold.com/Order_Form.html3/9/00 Indications
�Current
�Change
Gold
291.70
+1.70
Silver
5.15
+.03
Gold Lease Rate
0.4887%
nc
Gold Comex Stocks
1,373,896
nc


Market Report (3/9/00): Gold regained momentum this morning shaking
off yesterday's correction on continued strong physical demand and fund
short-covering on the Comex. Elise Shaw's FWN European gold report
contained this enigmatic lead: "Spot gold was flat with dealers
suggesting that many had been ordered to stay out of the market short
term." She did not specify whether it was the KGB or the Waffen SS that
issued the orders and no further elaboration was given, but it does
provide a clue as to what traders might be telling reporters when the
tongue happens to slip ever so slightly. Apparently -- with gold up
nearly $2 as this is written -- some in the market did not follow their
marching orders as precisely as others might have wished. (In the old
World War II movies, we would have arrived at the scene where Hitler
loses his cool and promises that heads will roll.) And so we launch
another day in the gold market....

We'll Tuesday's report up for a couple days since, marching orders
aside, it summarizes how we see this market at present.

That's it for today, fellow goldmeisters. See you here tomorrow.

(3/7/00) Report: Gold surged in early New York trading after a quiet
night overseas. Over the past several weeks we have heard recurring
reports from wholesales traders that there is an abundance of metal on
the market. Why then haven't prices reflected the large sales? Instead
gold has hung within a narrow range at one point surging well over $300.
Our view is that demand remains very strong in the physical market both
in the United States and overseas and traders short the market are
forced to square their positions on any significant dips. Once a
downside trading range establishes itself -- buttressed by the physical
buying -- the shorts find themselves forced to cover realizing that
chances are the metal isn't going much lower. We expect this set of
circumstances to dominate market thinking in the weeks and months ahead
as the gold carry trade continues to unwind at the major banks and
brokerages that have fed at the gold loan/forward trough since at least
the mid-1990s. Many prominent gold traders have lost their jobs, if
rumors are to be believed, gold trading departments closed down and
those still hanging on to their jobs wonder what will greet them at
their desk when they arrive at the office in the morning. These are the
aftershocks of the Washington Agreement earthquake which shook the gold
business in late September last year and sent the gold price careening
toward the $350 mark. We believe that those aftershocks will continue
for some time and we could even get another earthquake or two as we go
along through the year 2000. The net result in our opinion will be a
stairstep demarcation to the charts with gold moving steadily upward,
more short players losing their jobs as positions are unwound, investors
steadily acquiring physical metal, and the paper markets steadily but
relentlessly losing volume.

Today's action has all the earmarks of short-covering given the
suddeness of the move -- as if someone lost their nerve. We'll see what
happens as the day progresses. My advice -- cover those shorts; we're
going higher.

That's it for today, fellow goldmeisters. See you here tomorrow.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click on the link above and make the appropriate entries.
lamprey_65
(03/09/2000; 08:23:35 MDT - Msg ID: 26577)
(No Subject)
nickel62 and Strangernickel...I agree with your remarks regarding Barrick, well said.
Stranger...To each his own. My point was merely that Barrick will probably underperform other producers such as Newmont which is lightly hedged. History has shown that all of Barrick's hedging HAS NOT saved shareholders from a falling stock price, and it HAS hurt their upside potential. You may disagree, but I also see the possibility that Barrick MAY find itself in some difficulty if gold goes wild to the upside.

Barrick brings out strong feelings in many of us "bugs", but we realize that divergent opinions are nothing to get upset about!

No position on NEM (Although I have recommended it to my father)

Lamprey
lamprey_65
(03/09/2000; 08:34:51 MDT - Msg ID: 26578)
Liberty
Yes, I too have been thinking about the word "Liberty" lately.

I believe we have much less of it than we believe. Some examples:

1. The right to sound money. Whoops! Now here's a topic we are all well versed in but about which the majority of people are entirely oblivious.
2. The right to life. Abortion means you have NO rights...luck of the draw that any of us are here with legalized abortion.
3. The right to control your own income. Allan Keyes has this one pegged...since the government sets MANDATORY withholding levels, in principle they control 100% of what we earn. Sales taxes give the individual the power to decide how much and when taxes are paid -- THAT'S LIBERTY!
4. The right to bear arms. I am now a card carrying member of the NRA, and I don't own a firearm (yet). Enforce the laws already on the books and let the law abiding gun owner be.

Just a few off the top of my head. Good day, everyone.

Lamprey
Gandalf the White
(03/09/2000; 08:46:08 MDT - Msg ID: 26579)
Question for Sir ORO
Was that a PPT action at 10:59 ?
<;-)
Gandalf the White
(03/09/2000; 08:47:46 MDT - Msg ID: 26580)
OOOPS
that should be 9:59 !!!!
<;-(
CoBra(too)
(03/09/2000; 08:57:01 MDT - Msg ID: 26581)
Re: Solomon Weaver's Qu's (ref message 26507.
Sol W. - didn't go unnoticed - will try to reply over the weekend - sorry - very short of time - best regards CB2
Phos
(03/09/2000; 09:20:38 MDT - Msg ID: 26582)
COMEX Gold prices
Interesting post at Gold-Eagle today by Harry who has analysed the gold closing prices ex COMEX and overseas. 69% of gold price movements have been a drop on COMEX after the price had risen outside the U.S. Decidedly non-random and another indication that they do not want the price to rise in the U.S. He suggests that this is a likely manifestation of currency wars. I wonder how long this war will rage before we see the final resolution.
Henri
(03/09/2000; 09:24:51 MDT - Msg ID: 26583)
Gandalf the White
Guess "viagra" doesn't work for very very old entities like comex gold, the "bull" and the US$.

The hobbits are starting to dance...what does that mean?
Felix the Cat
(03/09/2000; 09:35:38 MDT - Msg ID: 26584)
I have a question to ALL!
To: ALL

Are the HIGH-TECH stocks still a freshion in the markets?

Xie Xie

F. C
Peter Asher
(03/09/2000; 09:42:58 MDT - Msg ID: 26585)
Invisible Hand, Canuck, Caven Man

The perception of Y2K being a major catastrophe was wide spread and included those in high places. No one should feel fooled or mislead by "a concept they bought into" or an urban legend

On Jan. 6, I got this from a friend who has been part of programing major projects for decades. --- It seems the Bureaucrats believed in Y2K more than the technical people "on the ground."

"So, we all survived Y2K. Actually, X--- and I didn't believe the dire warnings. Guess that comes from being in the computer business for so long."

"You are right, of course, that NASA wasn't taking any chances. In addition to the shuttle return, we had huge generators parked outside of a number of the Goddard buildings, ready to mobilize in case of power failures. Those of us who work on site at GSFC were instructed to back up all critical data to external media, turn off and unplug all of our computers and peripherals, and (get this) cover them in plastic in case the sprinklers went off. All non-critical systems were shut down at noon on the 30th."
Felix the Cat
(03/09/2000; 09:45:14 MDT - Msg ID: 26586)
too poor in English!
Fashion is more correct!
<:-(
Journeyman
(03/09/2000; 10:00:21 MDT - Msg ID: 26587)
Guns & "public health" - - - THE perspective @ SteveH, nickel62, dragonfly, ALL
http://www2.hawaii.edu/~rummel/20TH.HTM
The "public health" advantages of not using tobacco in terms
of deferring disease and death look scientifically
convincing. But whether I smoke or not is no one else's
business -- unless that someone else is exposed to _my_
tobacco smoke.

From the stand-point of physics, the "public health"
argument that wearing a seatbelt or motorcycle helmet may
save my life if I'm involved in an accident makes good
sense. Never-the-less, it's also no one's business but my
own whether or not I avail myself of those advantages. As a
friend says, "Those who attempt to protect me from myself
had better be prepared to die in that attempt."

An analogous "public health" argument would be that since
more children are killed in automobiles and swimming pools,
autos should be taken off the streets and swimming pools
should be filled in. Of course, the number of children
killed by drowning can be greatly reduced by teaching them
how to swim. Similarly, the number of children killed by
guns can be greatly reduced by teaching them about guns.

Guns are not, however, even in the same catagory as cars and
swimming pools. There is little up-side potential in going
seat-beltless or in smoking. Further, even cars -- and
certainly swimming pools -- don't save lives. Guns do.
Thus "public health" calculations in terms of implements of
self-defense, especially guns, are toatlly upside down.

Aside even from Second Amendment guarantees, the anti-self-
defense gun-stealers would have to prove guns are a NET
"public health" problem. That is, they would have to
calculate how many lives are saved by guns (including
children's lives) and compare that with how many lives were
taken by guns. If guns save more innocent lives than they
take -- not to mention the property protected and injuries
avoided by preventing robbery, rape, etc. -- then guns
calculate out as a net public health _benefit_. When these
admittedly difficult calculations are made, it turns out
that _eliminating guns_ is the greater "public health"
problem. See _former_ gun-grabber John Lott's work. He now
packs a gun as his civic duty.

And these calculations don't even take into account that the
main "public health" hazard in our environment, as it's
always been, is the institution of government. According to
the research of R.J. Rummel (see link in message header),
governments in the 20th century alone have killed 119
million men, women and children -- and that doesn't include
war (also sponsored by governments) which has killed "only"
another 35.7 million. Amnesty International puts the
current total government kill figure closer to 200 million
men, women, and children.

Weapons in the hands of the population deter governments
from engaging in such mass murder. When asked by a
reporter, "Since polls show that at least 80% of the Chinese
people favor what you stand for, what are you going to do
now?", a bandannaed leader of the Tiananmin Square rebellion
in China replied, "Nothing. They have all the guns."

As the historical record shows -- the holocaust, the
elimination of 20 million Kulaks by Stalin, Rowanda, etc. --
massive government superiority of arms and out-right gun
stealing by governments often pre-date large-scale mass
murder by governments. Just the fact we Americans are very
well armed subliminally puts the government on notice that
there are certain things they simply cannot get away with.

Perhaps that's why governments are so anxious to get weapons
out of our hands. Somewhere in the deeper recesses of the
organization is the realization that hitting up our kids and
grand kids with taxes that are projected to be over 82% of
their income (Clinton's 1994 Budget in a section entitled
"The Prospects for Intergenerational Warfare,") may cause
problems if our "posterity" is armed.

Regards,
Journeyman
ORO
(03/09/2000; 10:04:54 MDT - Msg ID: 26588)
Weighting of gold portfolios
First a note on the fixed income side.
Perhaps it has not been obvious to all that there are some fixed income substitutes for bonds and dividend paying stocks - some of which are available on the stock market.

1. Oil and Coal Seam/Natural Gas royalty trusts.
I think of these as hedges for your gasoline, electric and gas/oil heating bills. They produce income in relationship to the cost of energy. The nicest surprise is when your bills are tallied at the end of the month during an energy price runup, there is this terrible moment when you notice that they are $100-$200 (or more) higher per month than last year, despite a rather warm winter. After the bills are tallied you get the monthly or quarterly dividend check which had grown just enough to cover your extra energy bills.
The coal seam trusts include a capital recovery tax credit that can offset your tax bill slightly.

2. Convertible shares/bonds (e.g. Freeport McMoran), and similar ones for companies that are growing or produce natural resources - particularly oil. Most of these are not traded on the public exchanges, but you can trade them privately with the well connected people who get them in private placements.

3. For those underwieght in real-estate, REITs are very good substitutes. During high interest rate times people tend to rent rather than own and leading into the high interest rate periods (during the rise in interest rates), the REITs fall in value precipitously, often selling well below the market value of the real-estate owned - as they are today. You can get appartment REITs and any other specialized group you may like - retail space, industrial property, office-space, storage rentals, and cold storage properties.


Gold portfolios:
I view gold and its stocks in four ways: (a) financial disaster insurance - a hedge against an atmosphere of bad obligations, when people can not or will not live up to their obligations in paying bonds, rent or bills. (b) Inflation - when the monetary authorities across the globe pump up the money supply without creating fresh debt because of fear of a deflationary spiral. (c) Confiscation by property or income tax and outright seisure - gold bullion is very easy to transport to trusted hands abroad. It is not an account and can not be frozen. It is non-trackable if you want to make it so, and it is deniable if you want it to be. (Is it any wonder that governments hate it?) Since it is not an obligation, you do not need the government to be there to enforce the commitments you payed for and are not being fulfilled. (Inevitably, the government will assist the large and powerful at your expense, and take from the top to feed the bottom; i.e. take from those who have and give to those who have not - the debtors have not - the creditors have, guess on what side government ends up?) (d) As an investment when it is undervalued - when something other than gold, a gold substitute, is clearing the markets of its demand. And gold stands substantially below its production costs at the market clearing volumes.

1. Hedging your assets, a 15% level is often recommended for liquid assets - I think it is a good policy to use 15% of ALL assets as the base line for a gold portfolio allocation.

2. Hedging your liquid portfolio. If one has significant equity and fixed income in one's portfolio, it would be proper to go well beyond the 15%, according to one's view of the current situation regarding (in general) abillities and intentions of obligated parties to live up to obligations and of the monetary authority's intentions regarding monetization. A good substitute for private judgement on this matter is the interest spread between government and commercial debt. The higher the spread, the higher the market's view of the likelyhood of defaults. The higher the spread of mortgages to governments, the higher the risk to your rent income and your job (unless you are a bankruptcy attorney :) ), the higher the spread of corporate debt, the higher the risk the market sees in corporate income.

3. Investing. Gold as a portion of liquid assets can be viewed as an investment as well. Here I like to make estimates of production costs at market clearing production volumes relative to current prices and allocate accordingly. Currently the supply from fresh hedging and scrap sales is better than 30% of the supply - up from near 50% in the summer of 99 (using "official" numbers). The Production costs of an extra 1000 tons of production are on the order of $400/oz and rising. Thus the long term (2-5 year) allocation at this point would be ($400 - $290)/$400 = 28% down from the 38% allocation from summer 99. I use various forms of this calculation to determine an allocation for each time frame. I only started with this once the gold companies started to announce covering of short positions and the scrap data from the WGC showed a decline in scrap supply in 1999. I then followed the notices from Barrick and other major hedgers as to how much of their supply is spoken for to determine the portion of supply that is being met this way and whether it is growing relative to production or falling. Since early 1999 there were sure signs of peaking in hedge activity, made definite when the traditionally unhedged miner had undergone the panic selling imposed by their bankers - "we gouged their eyes out" was one quote as to how bankers deal with their gold mining clients. Few friends to be found there. To make a long story short, this structure for an asset allocation to a gold portfolio works not so much because of the estimates being right, but because of the discipline it imposes for the active long/intermediate term investor/trader. The correct estimates just make for better results.

Good luck to all.

Disclaimer - take this is the free opinion that it is - I owe none here a fiduciary duty and do not mean to imply that any of these strategies have worked or will work in the future. Gold and energy prices are very volatile and the use of securities and assets associated with them are even more so. Seek and obtain advice from a trusted financial professional.
Journeyman
(03/09/2000; 10:07:06 MDT - Msg ID: 26589)
Guns & "public health" - - - THE perspective: Addendum @ SteveH, nickel62, dragonfly, ALL

Sixty-some percent of gun deaths are suicides. The "public health" calculations on gun deaths include these suicides. It should be clear that suicides shouldn't be included here. Once suicides are removed, gun deaths are less than 40% of the reported figure.

Regards,
Journeyman
ORO
(03/09/2000; 10:58:22 MDT - Msg ID: 26590)
Wiz - 10 59
All is quiet on the PPT front.

Regular short covering and shorting are the mainstays of today's market. Hence the SP premium spending an inordinate amount of time outside the fair value range as shorts come in and out of their positions.



Journeyman and Steve

With you on all counts.

Suggest ammendment to all gun control bills barring government agents from carrying weapons. Particularly secret service agents. If it is good for the public it should be good for the government.
We should start with an armed guard provision imposing extra sentences for gun toting VIP protectors and death sentences for secret service agents using their weapons and life in prison if found carrying a weapon.

:-)
lamprey_65
(03/09/2000; 11:36:00 MDT - Msg ID: 26591)
Journeyman
Agree that smoking should not be restricted past the point where it does not affect me as a non-smoker. Yes, I too remember the old smoke filled restaurant days - personally,
I don't miss them and am greatful that MY right to clean air has been upheld.

If smokers want to smoke, fine. Just let me breath smoke-free air and one more thing...

I don't want to end up paying for their medical bills when they get lung cancer from this risky behavior (or head injuries when a motorcyclist fails to wear a helmet - no helmet law here in New Hampshire). This is the problem, people need to understand that with Liberty comes Responsibility.

Lamprey
schippi
(03/09/2000; 11:46:16 MDT - Msg ID: 26592)
FSAGX Hourly Gold Chart
http://www.SelectSectors.com/agpm70.gif Moving Up
Gandalf the White
(03/09/2000; 12:02:09 MDT - Msg ID: 26593)
Thanks, Sir ORO
The 9:59 $PREM jump sure kicked off the NAS to the upside.
<;-)
Journeyman
(03/09/2000; 12:24:14 MDT - Msg ID: 26594)
Paying for other's risky behavior @ lamprey_65, ORO, SteveH, dragonfly, nickel65, ALL

"I don't want to end up paying for their medical bills when they get lung cancer from this risky
behavior (or head injuries when a motorcyclist fails to wear a helmet - no helmet law here in New
Hampshire). This is the problem, people need to understand that with Liberty comes Responsibility."
-lamprey_65 (3/9/2000; 11:36:00MDT - Msg ID:26591)

Irritating isn't it? The answer is to un-involve yourself from any enterprise that forces you to
underwrite others' risky behaviors using your money. If your life/health insurance company
doesn't give a discount for non-smokers, appropriately sized for the decreased risk of payout,
change your insurance company.

The government, of course, is insurer of last resort, and very stupid at most of it's insurance
activities to boot. Thus those helmetless motorcyclists with serious brain damage often end up
on the public dole. There aren't a whole lot of these type of cases, and they would be better
handled by the Red Cross, local church charities, etc. This might also encourage riders to be
more responsible. It's difficult to not patronize governments, but not impossible. Look into
lowering your participation!!!

At any rate, it's a very dangerous precedent to endorse restricting others' supposedly risky
freedoms because some violent third party dragoons you into underwriting the supposedly risky
freedom by stealing some of your money for that purpose. That violent third party is the source
of the problem, and any solution should be directed only and directly at this source.

Regards,
Journeyman
Journeyman
(03/09/2000; 12:48:35 MDT - Msg ID: 26595)
ORO's law & bobbies

"Suggest ammendment to all gun control bills barring government agents from carrying weapons.
Particularly secret service agents. If it is good for the public it should be good for the government.
We should start with an armed guard provision imposing extra sentences for gun toting VIP
protectors and death sentences for secret service agents using their weapons and life in prison if
found carrying a weapon." -ORO

Phew!! Only one other nearly-as-radical proposal I've seen is from columnist Vin Suprynowicz! You're
right, of course. How many readers of this forum are free enough of government propaganda to look at
such a suggestion without being completely put off by it? Remember, until they began adopting
U.S. style insane anti-drug laws, no British "Bobbies" (police) carried firearms.

Regards,
Journeyman

P.S. I neither smoke cigarettes nor currently use other drugs such as alcohol, marijuana, cocaine, heroin,
etc.

HI - HAT
(03/09/2000; 13:57:34 MDT - Msg ID: 26596)
Bernard Baruch
As the evidence appears to stack up that we are in a stock- mania / gamblefest,; perhaps it won`t be an event or exhaustion that snaps the spell. Could rather be Bernard Baruchs example of the flock of birds flying in unison one way , then all of a sudden in the blink of an eye in a perfect unison going another way. For no apparent reason. Greed to Fear. For no apparent reason. Perhaps we will have no sustained move in precious metals until the spell of virtual reality investments is broken.
Golden Truth
(03/09/2000; 14:27:27 MDT - Msg ID: 26597)
TO Trail Guide!
Dear Trail Guide, I,am sorry i,am a bit late in thanking you for your answer to my question 4-5 days ago. I wanted some time to think about your response, i think you deserve it!
So i think i'll keep hanging in there and even buy some more GOLD right up to my personel pain level. I also will remain in 100% Gold coins etc, until it is time to sell for things "Near and Dear"
Thankyou so much for not losing faith in such a motley crew and all the other things you've had to overcome in trying to bring us the real truth surrounding GOLD at a time like this!

All the best to you T.G and when you find the time, keep those "juicy" updates coming in O.K :-) Thanks so much!
G.T
Strad Master
(03/09/2000; 14:27:41 MDT - Msg ID: 26598)
Question
For USA GOLD or Town CrierWhat is the difference between the Day and Night pages of the 24 hour quotes links? Whose day or night? When should I use the Night quotes link - when it gets dark outside? Obviously, this is not a question of any crucial importance but it just struck me as a bit odd that there would be two different links to what appears to be the same page.
Hill Billy Mitchell
(03/09/2000; 14:35:05 MDT - Msg ID: 26599)
Lamprey # 26591 - Freedom from interference
Sir Lamprey

Our true liberties are always in jeopardy when we accept government intervention in such small affairs. I suggest that all a person has to do to avoid breathing any air which he feels undesirable, is to simply avoid exposing himself to the air which he does not desire to breathe.

There is no such thing as being a little bit pregnant.

I do not desire to offend and of course you are entitled to your opinion as am I.

hbm
ORO
(03/09/2000; 15:04:33 MDT - Msg ID: 26600)
Journeyman - President not inhale and President coke head and obverse reasoning
Had the risky behaviors of the above resulted in accidents - namely from their riding helmetless over thin ice while intoxicated and waving a Colt .45 caliber semiautomatic pistol (without a lisence and outside duck hunting season) with which they had forced a young maiden into unwanted sexual intercourse - thereby causing their brains severe damage and making them eligible to become President of the United States or to otherwise become wards of the taxpayer, while avoiding military service in Vietnam, then we should come to the most definite conclusion that paying taxes is not moral because it creates moral hazard that induces marijuana notinhalers and coke notusers (who regret their wrongful behavior in their young days) to expect an escape from the consequences of their behavior.

Well, it was a pleasing thought, anyway...

Seriously, if you just read in the constitution each occurence of the words "government" or "congress" using the word "thief" or "thug" - one gets the message that the framers had in mind - that government is violent and intrusive, no different from a thug and a thief - and they attempted to make rules that limit government in behaviors similar to those of thieves and thugs.

Unfortunately, the spirit of the times had changed and people whom the framers thought to be thieves and thugs managed to both populate government and obtain the vote. Of course, those thieves and thugs in government quickly found a way to contract with a large chunk of the public to join in the thievery.

Once this relationship was established, it became very easy to extend government power everywhere. Telling all what where and when they can and can not eat, drink, smoke, make, sell, buy, own, inject, or dispose of. All of this by vote of a "majority" of representatives that was representing a "majority" of voters.

I am not a believer in absolute democracy - I am a believer in constitutionally limited government that can not do anyone harm legally. That 99.999% of the poppulation/voters favoring a law is not a good enough reason to have it. The only government action that is irreplaceable by other forms of organization is military services. I think that the realities of crime make government at any level ineffective in fighting it. Furthermore, the great surge in the number of actions that are legally considered crimes has made it impossible to effectively fight any crime. "Victimless crimes" are not possible. If there is no victim, there was no harm, if there was no harm then there was no reason to make a law against it and the crime is a legal fiction.

The war on drugs is the most egregious misuse of the criminal code. Using the fictional damage that drugs do to their users (medicine has shown that contaminants in the drugs, not the hallucinogenic compounds, cause the damage) and the fear of the even more fictional notion of "addiction" (only a minority of people using drugs actually become addicted - true for most hallucinogenic drugs), government has managed to frighten us into giving up all freedoms and constitutional rights whatsoever. If we are SUSPECTED, not convicted, of carrying a certain arbitrary quantity of something the government decided was a drug, then we can be detained, our property forfeit without hearing, trial, or effective legal recourse. We have no privacy because all transactions we do above a certain monetary size must be reported, as do prescriptions (though not directly to government - yet), and practically anything we throw out in the garbage or flush down the toilet. We have no rights to legal representation because the means for representation (property/money) are taken away from us BEFORE a trial.

Finally, since time is growing short, I want to say that I believe that any service provided by government does more damage to us than would its absence - with the single exception of military protection. Furthermore, government does not represent the will of the people, and even if it did, that does not matter, rights are only in the realm of the individual, any collective organization has mo more rights than those entrusted to it by the complete and unanimous agreement of all participants.

A parting thought - make a list of laws and apply them to the government and its various agents and agencies. See if they sound absurd. If they do, they should probably be abolished.
Dollar Bill
(03/09/2000; 15:23:49 MDT - Msg ID: 26601)
the brown acid at woodstock
Hi there ORO,
I have freinds from the acid daze and some of them left drugs and went to alchohol and now use coffee and chocolate and suger for thier high.
Some went on to downers then cocaine and now are mostly pot users and alcohol to some extent.
The differences in thier company are dramatic. The potheads are much less likely to laugh and are not brilliant except perhaps to themselves. If they ARE brilliant it does not transmit well to those around them. Those around alcoholics
can best describe the drawbacks they see in thier drunken loved one. I can't make a case for any of the people I know that use all that stuff. Whatever visionary moments are percieved to be gotten can be gotten by concentration alone.
And with perhaps a thanks and tip of the hat to the sponsor of the show. Perception and appreciation of life are best helped by just body healthy nutrients and good company.
Harley Davidson
(03/09/2000; 17:03:09 MDT - Msg ID: 26602)
Well...
the NASDAQ performance had Maria Bartiromo bubbling like a urine specimen today on CNBC.

Surely, her composure and acting talent will be tested when the NASDAQ takes the plunge and she can't get in touch with her broker because they've taken the phones off the hook or the broker's web site is in denial of service from so many hits. And even if contact were possible, who is going to be interested in buying what she wants, so desperately, to sell? It won't be pretty.
4Ducat
(03/09/2000; 17:25:46 MDT - Msg ID: 26603)
Laws or Liberty? The East vs the WEST.
http://www.dailyreckoning.comThe president wants to raise the minium wage $2 in two years. This shows us how brainless these guys are. They talk about inflationary wage pressures and the loss of manufacturing jobs then proceed to shaft business owners with having to pay more for workers. The only manufacturing jobs left are in industries that have production equiptment so large that it can't be physically unbolted from the floor and shipped to Mexico. Increasing wages increases the costs of production which get passed on to the consumer. Well, inflation is fine for gold, guess I can't complain. We see different effects of this inflationary pressure becoming evident one at a time. Soon the costs of shipping will go up as truckers demand more per mile due to higher fuel costs. All plastics use oil derivatives for a base.

What we should do to compete with the Japanese is to allow open immigration for the Taiwanese. As in a karate fight you do not initiate the force you only redirect the other's force against himself. So you beat the Japanese with the Chinese. Then as Tiawanese naturally gravitate to manufacturing jobs we get the same products produced over here IN OUR HEMISPHERE. We need educated high tech workers. If you don't want them, Canada will take them. You want to save Social Security??? We need healthy taxpayers to provide for the generation that was aborted. Abortion killed social security. Where are all the future taxpayers? Stuffed into bags and buried in landfills. Talking about my generation. It would be a nice gesture to give the Reds an evacuated rock in the Pacific. Don't move the fleet to defend the island. Move the island. Everything that has any commercial value, move it to the US our to enterprise zones in Mexico. There are many products we take for granted that are not produced here. We are vulnerable with all this importing. We use foreign products like the Japanese import their food. Gotta have it.

About LIBERTY: I have a cousin who moved from New Jersey to Colorado. Talk about transition. He got into liberty by trout fishing. He got tired of all the restrictions as to where and when he could fish. I'm proud of him because he just climbed one of the highest mountains in Argentina at 24,000 feet without oxygen. That's going for the gold. They said the last 40ft of peak took them over an hour because they could only crawl to the top. After he moved to Colorado , Telluride (before the boom), his whole philosophy of life changed. I could notice the contrast with attitudes in the Eastern US. In the West they believe in liberty not law. Liberty is the freedom of behavior due to a lack of laws. It is not a German concept but more like one from the American Indians. Our founding fathers were amazed at how the Indians could hold a council meeting and not have a shouting match where it all dissolved into partisan bickering. Franklin wrote that it was so amazing how mere savages had such a fine system of representation worked out that the whites did not have. This Iroquoy Six Nation Confederacy so amazed the other founding fathers that they strove to duplicate the same system of checks and balances that they saw. For the elders they had the supreme court. Leaders were elected with the young braves reps as the "congress" with their older fathers represented by the "senate". So the LIBERTY of the indians was what the Constitution was written for to protect for white society at the time. So this liberty was framed in the constitution. In the West there was no law except those written on men's hearts. Add some whiskey and some guns and soon the people wanted some written law. Easterners want lots of laws to this day. The Germans in the East want a law for everything they see as "bad" behavior. Laws are to promote efficient behavior. Where there is a scarcity of resources the idea has some validity. Where there are more buffalo than the eye can see what is the scarcity of resource the laws could protect? In PA Dutch country they say "There ought to be a law against that." So we have laws upon laws upon laws. Until it eventually becomes illegal to do anything without a license or a permit. That Statue of Liberty is really hollow in the Hudson. In the West they think there should be no laws prohibiting drunks from driving off of mountains. It's a "then let the odiots die" attitude. Soon there won't be so many idiots. When the drunks crash their cars that is penalty enough. The difference is in the east there are so many others affected by the sins of the few. So the drunks don't drive into the ditch but into the innocent. If laws of truth are written on men's hearts then those men don't need written laws. That was the marvel of the American Indians, no written laws. Maybe they paused from living in continuous warfare long enough to impress the founding fathers enough as to "how it should be". The the white man steps in and has to write it all down. So lawyers take away the key of knowledge by altering the meanings of written words on written contracts. So my point is that written laws take away liberty. But, without strong family structure as in a clan or tribe, then written laws are necessary to cull the disobedient from society because no moral discipline from the clan or tribe is present. Feel free to add your 2 cents. Just make sure it's 2 cents in gold.

My liberty to own gold legally is a freedom we gained in 1971 with the repealing of a written law.
TownCrier
(03/09/2000; 18:06:06 MDT - Msg ID: 26604)
Sir Strad Master's Question
http://www.mrci.com/qpnight.htm"What is the difference between the Day and Night pages of the 24 hour quotes links? Whose day or night?"

For the gold quotes given, either page (Day and/or Night) seems programmed to give the latest trade on the most active gold future contract (April at this time.) You can confirm that the time listed for the most recent gold trade is the same for each, so you can't go "wrong" with either link as your source. (You might have to hit your browser's refresh button to ensure you are looking at fresh data.)

Moore Research Center indicates at the top of their market-pricing tables that all times given are U.S. Pacific time. The distinction between "Day" and "Night" varies depending on the market you are following and when it's standard trading day ends. Careful comparison of the two charts will reveal that not all markets have price makers in afterhours or overnight trading. The best example is right at the top where you can see the DJIA Index last quote is frozen on the screen at 13:02 Pacific time (16:02 Eastern) on the "Day" chart, whereas this is not even a listed market in overnight trading.

The Bottom Line is that you can't go wrong with gold on either one...they both always show the latest trade because the sun never sets on gold. And in the short time we've been typing this from The Tower, we see that the price for the April gold contract has climbed $1.30 over what it was when we started this response.

So, with no reason for trepidation, feel free to plow into those MRCI quote pages!
TownCrier
(03/09/2000; 19:08:33 MDT - Msg ID: 26605)
Fed playing one day at a time for now on RPs...
Although analysts expected to see the Fed utilize a term repo at the start of this new two-week reserve maintenance period for the banking system, the Fed added $4.52 through overnight repurchase agreements.
dragonfly
(03/09/2000; 19:12:57 MDT - Msg ID: 26606)
Confiscation
ALL - just found a thorough treatment of the confiscation of gold in the 1930's. Worth a read.
dragonfly
(03/09/2000; 19:14:06 MDT - Msg ID: 26607)
Confiscation
http://www9.pair.com/xpoez/money/goldThe link would help.
Bonedaddy
(03/09/2000; 19:14:25 MDT - Msg ID: 26608)
Managed Economies
http://www.StopWTO.org. Representative Ron Paul is attempting to defend our liberty again. Let's get behind him by contacting our elected representatives.
Solomon Weaver
(03/09/2000; 19:22:09 MDT - Msg ID: 26609)
Stranger on Barrick
Meanwhile, the company is quite sound and is one of the very few with capitalization large enough to attract institutional interest should the bull market in gold continue.
----
One of the things which I have not really understood about the way companies "hedge". When we speak of the "forward sales" of Barrick...does this mean that they actually receive funds (dollars) now for the promise of delivering gold from their production??? If so, this means that much of the "income" which they are to receive over the coming years has already been taken on to their books....thus, if they appear "well capitalized", is it not such that much of that cash is actually designated to pay for future operating costs and is not available for things like new investments?

What if that cash pool is "unwisely invested"?

What if the actual costs of future production rise dramatically due to strong inflation in dollar costs?

Also, part of what I have understood about a good mining company is that as the price of their product (gold) rises, they shift production towards lower grade ore which has higher costs, saving the "richer" deposits for the lean times.

Something else which I have only recently come to understand: Most mining companies are recovering several metals from the ore they process....I have not read any of Barrick's materials...I can only assume that they recover silver, copper, perhaps zinc and or lead, in some of their operations. This is also part of their cash flow.

I was told by a silver mining executive that one of the reasons that silver prices have stayed so low is that as much as 70% of the world's yearly silver production comes as "secondary" metal from gold, zinc, and copper mining. These companies often fix the prices for future delivery of silver because they are unwilling to expose themselves to volatility in more than their primary metals. This also means that these companies would only be able to increase silver production if the demand for their primary metals would rise.

Let us say that we were to slide into a worldwide liquidity crisis where many investment projects and larger capital expenditures (rental car and trucking fleets) were put on ice...I would assume that it is possible for the demand for copper (electric) and zinc (steel) and lead (truck and auto) to fall (perhaps even as demand for the "hard money" metals rises). One question to ask of Barrick's program is how much of their revenues are not gold but other metals, and how "profitable" would their gold recovery be if they were not able to "sell" this additional material at today's prices?

Stranger....I admire your perseverance to convince all of us to keep rethinking...I challenge you only in the spirit of investment analysis to think of all angles.

Poor old Solomon
Bonedaddy
(03/09/2000; 19:27:46 MDT - Msg ID: 26610)
Government buying back treasury debt...
http://www.publicdebt.treas.gov/opd/opdpenny.htm So, I'm thinking to myself.....self I says,.... there ain't no surplus. So how is the treasury buying back all this 30 year debt with the "surplus"? I don't feel so good. But, then I thinks, self....you got GOLD! Now I'm feeling better.
Al Fulchino
(03/09/2000; 19:44:13 MDT - Msg ID: 26611)
Book Deliveries
Brief Interruption O Gracious Host:

To all who are expecting delivery of "Finding God in Physics" by Roy Masters, I delivered all copies to the post office last week and this week. Depending on which part of the globe you are residing in, you have either already received or will in the next couple of weeks.

Just wanted to leave one message, so you didn't think I had forgotten. Enjoy.
TownCrier
(03/09/2000; 19:45:16 MDT - Msg ID: 26612)
Has it come to this?? The U.S. Dollar on life support, nursed by Japan?
http://biz.yahoo.com/rf/000309/bi6.htmlHEADLINE: Japan intervened to counter rapid fx moves

Wednesday's FOREX intervention was said by Japan's Finance Minister Kiichi Miyazawa to be in response to rapid fluctuations..."There appeared to be some rapid fluctuations in currencies, and there were indeed such movements," saying also that he was unsure about the cause for the yen's strength, suggesting the a fall in the Dow and weakening euro. While Reuters reports "Japan has repeatedly said rapid movements in currency rates are undesirable for its own and the world economy and that it would take decisive action to deal with them," Japan's Vice Finance Minister has standing orders to intervene as necessary.

As you know, this is essentially a dollar/yen equation, so if the dollar falls (= yen strengthens), the standard Japanese response to sell yen for dollars temporarily weakens the yen and bolsters the dollar. Do you think Japan enjoys their new role as the world's economic "saviour"?
DAYOOPER
(03/09/2000; 19:57:12 MDT - Msg ID: 26613)
URL of interest
http://www.devvy.com/After reading several of the posts tonight with a theme about our Constitution, I thought some of you that, are not faint of heart, may find the URL above interesting. I am not affiliated or have anything monetarily to do with this site...just came across it while surfing. Pretty incredible stuff if true.

DAYOOPER
TownCrier
(03/09/2000; 20:03:48 MDT - Msg ID: 26614)
Sir Dayooper, I agree.
http://www.devvy.com/crockett.htmlThe Davy Crockett tale there is a particularly inspirational example of how things used to be...or could be in a better world. The good ones always seem to be few and far between.
Solomon Weaver
(03/09/2000; 20:18:12 MDT - Msg ID: 26615)
SteveH on Liberty and Public Health
Steve

I think that all Americans should have the right to own a gun if they so desire....I am, however, of the belief that there are serious responsibilities connected.

For example, I believe that the parents of all children who commit felonies should face prosecution as well and that the parents of a child who use a gun to kill students in a school should be put on trial for murder.

The guns which our founding fathers had required more than a minute to reload, were hardly accurate beyond 50 feet. Now 10 year old kids who watch Ranbo can get ahold of assault rifles with clips holding more than a dozen rounds and can play sniper from hundreds of feet away. The development of munitions have allowed all manner of metal piercing or highly fragmenting bullets...usually developed for the police but used liberally by criminals.

One of the reasons why Americans now feel they need weapons is not to be ready for a Chinese invasion (militia) but to protect their families from criminals who have guns.

Of course the anti-gun lobby uses the children thing because it is emotional to white yuppie mommies...the much greater tragedy is that the chances of a black male teenager dying from gunshots in certain urban neighborhoods is about 10,000 times higher than kids at a rural school being shot.

Any real gunowner should understand that guns are made for one primary reason and that is to kill. Hunting animals for food and sport - certainly reasonable if it does not decimate animal populations. If we didn't want guns to kill people, we would use projectiles with fast acting poison. The sport of marksmanship is facinating, but no less interesting done with a crossbow. A majority of marksmen are making a sport of training for the moment when they may need to use a weapon (to hunt or kill).

I do not own a gun...but if I did, I would take it down to a range about 4 times a year, and make sure I know how it feels in my hand and how to let out a series of rounds and keep my composure.

I would feel much safer in a society where I knew that gun ownership was a "right" that had heavy penalties for abuse and where gun owners knew how to use guns.

I would be interested in your suggestions as to how we can reduce the number of guns in criminal hands without limiting the access to law abiding citizens.

Poor old Solomon
2mules
(03/09/2000; 20:40:16 MDT - Msg ID: 26616)
i luv silver
please alow me a few mistakes in my post, I'm not a pro! I want to talk about silver. The bottom line is that I want to make a bunch a money on silver. But, let me entertain you with numbers: (#'s are for reference, not exact)
METAL..........ABUNDANCE.......TONS-MINED........PRICE
Aluminum .......16,400,000......21,200,000........0.72/lb
Zinc................26,400.......7,800,000........0.50/lb
Nickle..............16,000.......1,080,000........4.63/lb
Copper..............10,000......13,000,000........0.78/lb
Lead.................2,600.......5,900,000........0.20/lb
Tin....................400.........201,000........2.56/lb
Silver..................20..........15,300........5.00/oz
Palladium................2.............135.........675/oz
Gold.....................1............2700.........300/oz
Platinum.................1.............160.........490/oz
------------------------------------------------------------
The above is a "if you do the #'s" that silver stands out.
But, the market does not favor common sense and can punish fundimental correctness. I am invested up to my butt in silver, knowing that the floor is at toe touch and that the vast depth belongs to the up side. I can sleep with this, feeling that those who want to make a fortune should give this a serious thought. 2mules
Journeyman
(03/09/2000; 20:43:22 MDT - Msg ID: 26617)
Moral hazard and brown acid @ ORO & Dollar Bill

ORO (03/09/00; 15:04:33MDT - Msg ID:26600)
Journeyman - President not inhale and President coke head and obverse reasoning

You're right again!! I mentioned a study awhile back that
un-insured motorists in Philadelphia are involved in far
fewer accidents than expected, apparently because they drive
more carefully. Guaranteed insurance of any kind, even
"social insurance," welfare of any sort indeed creates moral
hazard.

Dollar Bill (03/09/00; 15:23:49MDT - Msg ID:26601)
the brown acid at woodstock

Perhaps such drugs help some people some of the time, others
all the time, and some never. It was smoking marijuana in my early twenties that demonstrated to me there was more
than one way to see things -- and without that insight, it's
probable I'd have been a suicide near that early age.

At any rate, noone promised me others existed to be interesting
to me -- darn!! So while I may bemoan those deadened, especially
by alcohol, I would staunchly defend their right to that
choice.

Regards,
Journeyman


DAYOOPER
(03/09/2000; 20:50:57 MDT - Msg ID: 26618)
Poor old Sol
Pretty harsh punishment for a parent Sol. It goes a little deeper than this. When is a child not a child? Of course the little six year old is quite an extreme and by no means something you hear of often and should be treated differently. But to try a parent for murder because they couldn't control a 14,16,18,20 year old... where does the age of reasoning and responsibility of their actions begin?

DAYOOPER
4Ducat
(03/09/2000; 21:24:08 MDT - Msg ID: 26619)
W.A.C.(Wide Awake Club)Pro-Gold Analysis in Real-Player audio
http://www.radiowallstreet.com"Mind if I get a ride to the nearest pro-gold station"

"My rally ran out of gas"

So where are you going? I'm going to Technical Analysis with Bob Brogan. Who is he? The main dude among the wanabees. A lion among the hyenas. Says.................."We are bullish the GOLD BULLION looking for $355 and not the shares". It's time to turn on the boom box for some Classical music. Click on the above link and look on the right side of the web page for the spot. You need Realplayer installed. You can download it for free, try www.realplayer.com . Have a great day. 4-DUCATs
4Ducat
(03/09/2000; 21:52:23 MDT - Msg ID: 26620)
A statistic among millions for what? For Tyranny.
http://www.usagold.comLet's think about the shear size of the general population. It is so vast now and with instant access to multimedia news, any spindoctor (newsmen) can whip up any story that occured anywhere and use it to promote their slant. So a six year old gets the gun and kills some one. This goes on everyday and always will because of the size of the population. I could probably find 20 people in critical condition today from dog bites. OK lets muzzle every dog. That guy shouldn't have that dog under the bed without a muzzle on it. I could find in this country probably 50 housewives who received stiches because they cut themselves chopping vegetables with sharp knives. It ought to be mandatory that all kitchen knives be kept in sheaths. Well a new technology will be developed that will identify the user of the kitchen knife so that an untrained vegetable chopper couldn't get ahold of one and .............. More laws for morons..............But this six year old got the gun from a crack house. Or maybe his only home was the crack house. So drug dealers apparently aren't teaching proper handgun awareness to their second graders. Or maybe if the police were doing their job instead of "waiting 20 minutes till the smoke clears" and "waiting for more backup" or "Oops just received another call" anything but bust the crack house. Well that district is "dirty" so we have to wait till the dealers cross over into this other district where the DA will make it stick. Police have a tough job. Serpico may still live in France. I have personally seen in central NC where drug dealers were being protected by police in the same parking lot where the drive-in window operation was going on. They bought the law. That is how the kid got the gun. His father was never caught.
Journeyman
(03/09/2000; 22:30:28 MDT - Msg ID: 26621)
Great posts @ 4Ducat

Good stuff, 4Ducat!!

Regards,
Journeyman

Marius
(03/09/2000; 22:51:30 MDT - Msg ID: 26622)
Lamprey_65: "liberty & resposibility
"I don't want to end up paying for their medical bills when they get lung cancer from this risky behavior (or head
injuries when a motorcyclist fails to wear a helmet - no helmet law here in New Hampshire). This is the problem,
people need to understand that with Liberty comes Responsibility."

Lamprey,

While I agree with your last sentence, what you describe in the first has little to do with liberty. Let me explain. Once you set a mentality like that loose among the people there's nothing to stop any group from being targeted for their behavior and/or habits.

Don't like my smoking, eh? Well, I don't like your sugar, caffein, alcohol consumption or whatever. You could stand to lose a few pounds, or pay some extra taxes and insurance premiums to cover your heart attack risk from toting that gut around. (Hypothetically, of course. I cast no aspersions about your actual appearance or habits!

The possibilites are limitless, which is why government types love this method of conquest. Divide and conquer. Class warfare, health warfare, race-baiting. It all serves the same purpose: to prevent us from figuring out who the real eneny to liberty is.

Besides, by my calculations, you ought to thank me for smoking. Statistics show I won't live as long as others, thereby saving countless Medicare & SS benefits. My tobacco taxes are providing a windfall for all manner of programs you or your kin may benefit from.

I'm only half serious with the previous paragraph, but the rest is written in all seriousness. (I do indeed respect the rights of non-smokers. I've never subjected my wife to second hand smoke in our almost 19 years of marriage. I go outdoors.) Government lives to set us at each others' throats, while at the same time trying to save us from ourselves.

Chris Powell
(03/09/2000; 23:04:09 MDT - Msg ID: 26623)
Gold Newsletter recognizes GATA
http://www.egroups.com/group/gata/405.html?There's more and more "nuts" like us.

To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
Journeyman
(03/09/2000; 23:11:57 MDT - Msg ID: 26624)
The protection racket @Marius, lamprey_65, ORO, SteveH, dragonfly, ALL
http://www.webleyweb.com/tle/le9611a02.html
Here here Marius!!

Yes indeedy!

For a good spoof on the "protection racket," see the article
by L. Reichard White, located at the above URL.

Regards,
Journeyman
Chris Powell
(03/09/2000; 23:29:51 MDT - Msg ID: 26625)
Whose definition of money will we use?
http://www.egroups.com/group/gata/406.html?Reg Howe contrasts Daniel Webster's
definition of money with Alan Greenspan's.

To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
Simply Me
(03/10/2000; 00:17:03 MDT - Msg ID: 26626)
Only 3 good deeds in over 200 years! Not a record to be proud of.
IMHO...the only three good things that have ever come out of Federal Government are the Emancipation Proclamation, the Interstate Highway System and the Internet. And all three were begun for National Defense NOT for the benefit of the people. Our government has NEVER intentionally DONE ANYTHING that purposefully INCREASED the LIBERTY of the people.

And then they wonder why we don't trust them?
Own gold...because the Federal Government will debase your currency whenever it suits them.

simply meView Yesterday's Discussion.

lamprey_65
(03/10/2000; 01:25:00 MDT - Msg ID: 26627)
A few thoughts before I finally get to bed...
I guess my main point this week (and I've spoken of this before) is that with liberty comes the necessity of responsibility. When a society denies one, the other will surely begin to fade.

Now, one more point on this which will surely ruffle some feathers...

Who would I rather see pick up the tab for medical expenses related to smoking - the tax payer (me, a non-smoker) or the manufacturers and users of cigarettes? I think you know the answer.

4Ducat...interesting point about the spread of sensationalism. To be honest, why should I even be interested if someone in L.A. (or Chicago, Dallas, etc.) gets shot? I live in a small town in New Hampshire. People today seem to know more about what is happening hundreds or thousands of miles away than what is happening in their own neighborhoods. Not a healthy recipe for one's emotional health, nor is it a good sign for active participation in the local community or government. If something happens in my town, I should care very much.

I live a half mile from the town hall, the same town hall in which Senator McCain spoke before the primary. A sense of community, we still have it in some areas, but not most.

Lamprey
Leland
(03/10/2000; 02:39:46 MDT - Msg ID: 26628)
There Have Been a Few Great Men in the White House
"I have very large ideas of the mineral wealth of our
Nation. I believe it practically inexhaustible. It abounds
all over the western country, from the Rocky Mountains
to the Pacific, and its development has scarcely
commenced....Immigration, which even the war has not
stopped, will land upon our shores hundred of
thousands more per year from overcrowded Europe. I
intend to point them to the gold and silver that waits for
them in the West. Tell the miners from me, that I shall
promote their interests to the utmost of my ability;
because their prosperity is the prosperity of the Nation,
and we shall prove in a very few years that we are
indeed the treasury of the world."

Both Presidents Johnson and Grant, as well as a
majority of both Houses of Congress, agreed with this
sentiment by enacting these laws to encourage
exploration of the public domain.
HI - HAT
(03/10/2000; 04:08:08 MDT - Msg ID: 26629)
WORLD CORNOCOPIA INTERUPTUS
Its been put forth that the primal human motivation is not money,power,etc., but above allthe lust to dominate... DOMINATION. Yes it is different this time. The loose cannons on deck are bigger than ever. If world socio- economic stresses boil up the sea in a coming time what will be the temptation- desperation of the mongrel alpha-male leaders of one of the power blocs to go for broke? In the entire history of the Roman Empire the doors of the temple to war were only closed TWICE. IMO the probability of this reversion to the mean is very serious. Yes we will have great gratitude to be clutching gold in our hands but this spectacle is pathetic.
Henri
(03/10/2000; 04:21:50 MDT - Msg ID: 26630)
Lamprey_65
You speak of the bearing of responsibility as a cost of freedom yet when you propose only the two alternatives for who is to pay the cost of smoking...you ignore the obvious. The individual/family and/or the insurance company that they paid such high premiums to all those years because they were smokers. That is who should bear the medical costs. Much of the media focus on this issue is designed to divert attention away from the responsibility of the insurance company's to pony up now that the chickens are coming home to roost. A little digging will reveal who is really behind this push to offset costs to the tobacco industry or the taxpayer.
Henri
(03/10/2000; 04:52:42 MDT - Msg ID: 26631)
Journeyman Msg 26617
Now we have more insight into your moniker :-)
ss of nep
(03/10/2000; 06:25:52 MDT - Msg ID: 26632)
Possibly the most dangerous person on earth
Date: Fri Mar 10 2000 07:53
cherokee (@...fodder.for.t1...........) ID#198217:
Copyright � 1999 cherokee/Kitco Inc. All rights reserved

Hello Again,


The Strong Scent of Tyranny

- by James Hirsen ( hirsen@earthlink.net )

Once upon a time, his name was cautiously whispered within the dark confines of a militia group meeting or two. Today, Maurice Strong is up front and center in at least two recently published mainstream magazines. In September of last year, Mr. Strong was the subject of a cover story in National Review. Amazingly, the first feature story of 1998 in Forbes stars this same ascending world figure.

Strong has emerged as one of the most powerful and enigmatic figures on the international scene. He wields considerable influence in the areas of business and politics. Twenty years ago, The New Yorker magazine described Maurice Strong as the man upon whom "the survival of civilization in something like its present form might depend."

As of late, this billionaire Canadian businessman works simultaneously for the United Nations as Senior Advisor to the UN Secretary General and for the Rockefeller and Rothschild's Trusts. He is Director of the International Union for the Conservation of Nature, Senior Adviser to the President of the World Bank, Chairman of the Earth Council, Chairman of the World Resources Institute and Co-Chairman of the Council of the World Economic Forum. He was Secretary General of the 1972 Earth Summit in Stockholm and the 1992 Earth Summit in Rio de Janeiro.

In addition, his credentials include membership in the UN funded Commission on Global Governance. This body's 1995 report called "Our Global Neighborhood" contained a number of ominous proposals including the establishment of a global tax, UN control over "global commons," expansion of the powers of the World Bank, expansion of the jurisdiction of the International Court, removal of U.S. veto power in the Security Council and creation of an Economic Security Council to oversee the world's economy. Clearly, the implications of such proposals were intended to move us towards the creation of a world government infrastructure. Unfortunately, they also necessitate and precipitate the decline of U.S. sovereignty.

Strong's business arrangements have been equally convoluted and diverse. His dealings have involved major U.S. oil interests as well as influential power brokers including Saudi arms merchant Adnan Kashoggi and Canada's Power Corporation.

Currently, Strong is attempting to control a potential scandal involving Molten Metal Technology, a hazardous waste firm known for its ties to Vice President Al Gore. Molten Metals has surfaced in the Senate hearings on campaign financing due to questionable contributions made to Gore's campaigns.

Strong has complained that "the United States is clearly the greatest risk to the world's ecological health" and has forcefully advocated a new economic order based on the redistribution of the developed world's industries and wealth to the Third World.

Strong has supported New Age movements in the U.S. and once helped finance a second ark in preparation for the next great flood. His many global activities are orchestrated with the philosophical bent of a long time believer in the establishment of a new world religion.

Strong has instituted what is ostensibly the global headquarters for the New Age movement at the foot of the Sangre de Cristo Mountains near Crestone, Colorado. He and his wife run the Manitou Foundation and call this center the "Baca." It is an international collection of alternative religious beliefs. Located at this New Age mecca are a subterranean Zen Buddhist center, the Haidakhrndi Universal Ashram, a facility for Native American shamans and a Vedic temple where devotees worship the Vedic mother goddess.

The Rockefellers, the McNamaras, the Kissingers, the Rothschilds and other international bureaucrats conduct regular pilgrimages to this center for global spirituality.

UN watchers place Maurice Strong on the top of the short list to become the next Secretary General of the United Nations. No one is better positioned or as well connected to achieve this increasingly powerful position.

We can smell it coming. When values decline as they have in the last twenty years, the continuity of civilization requires that a substitute order emerge to insure societal stability. If we are not careful, this substitute could take the form of tyranny. Perhaps even a secretary general with greater powers than any predecessor has heretofore been vested. Sort of a king of the world.







ss of nep
(03/10/2000; 06:29:15 MDT - Msg ID: 26633)
Maurice Strong

The walking talking Hegelian Dialeltic

Dialogue to consensus ( make a compromise )

to destroy all liberty and freedom.

Henri
(03/10/2000; 06:35:44 MDT - Msg ID: 26634)
Town Crier Post 26612
This intervention has more to it than it appears on the surface. Remember we are in the midst of a currency war!

Every year, at certain times, the Japanese companies must repatriate their yen for accounting purposes. This is a planned event. Prior to the yen repatriation cycle the yen is decreased in value(sold down)by the Japanese govt. so that more yen are obtained for each US$ that is traded in. This boosts the profits in yen terms on the books of the Japanese companies. The weak yen then sets the stage for the next cycle. Japanese products appear to be a bargain with attractive prices for US consumers. Once the sale is made the US$ is pumped up (yen sold down)to bring the yen back home. The sad truth is that, the US taxpayer subsidizes the production of Japanese goods. The yen brought home are sufficient to generate enough huge profits (in yen by the artificial sell down)for the corporations that they do not need to convert all the dollars back into yen. This would cause a shortage in yen and drive the price up. Instead they use the surplus dollars to buy US Treasury obligations. The US taxpayer supplies the interest payments which are used for buying US machines and equipment to run the factories and steel mills and to buy oil in petrodollars to power the factories and cities. This has been going on for decades. In real terms, how much do you think those cheap Toyotas cost you. Ask a UAW member.

The absolute worst thing that can happen in this environment (repatriation cyle) is for the yen to take a sudden move up vs the US$. That is what is happening. That is why they had to intervene. Whoever is orchestrating the rise of the yen at this time has quite literally dropped the equivalent of a nuclear device in the currency war and it was exquisitely timed. The yen is predominately a US$ driven ecomomy and will suffer with the US$ as it declines. Perhaps the Europeans taken a lesson from the Japanese businessmen and have worked the Euro lower in order to play the same game. When the evryone wants the dollar higher at once, it seems to have an unnatural bouyancy. Perhaps there should be a G-2 summit where the interested parties can coordinate their timing on orchestrating movements in the US$. Perhaps there already is.

Perhaps the punchbowl has gotten so full this time it fell over and 90% of the folks at the party have yet to realize it. The rest are leaving in a mass exit to unload the dollar at favorable rates to their own currencies which will probably survive.
RS
(03/10/2000; 07:07:56 MDT - Msg ID: 26635)
Thank you to the USA Gold Forum
Having visited quietly here for more than a year, I wish to thank the host of USA Gold Forum for allowing me the opportunity to be in the company of those who understand the value of honest money.

Simply Me:
Government will debase your currency while professing loudly all the while to be "caring for" you, your children, and posterity.
If power corrupts, what does that say of people who actively seek the kind of power afforded by an exclusive grant to issue a nation's currency?

On the advice of those who have come before me:
Defend yourself-
Own pure gold.
HI - HAT
(03/10/2000; 07:14:42 MDT - Msg ID: 26636)
ss of nep 26632
This is what I am alluding to in 26629. This western, fruit-cake, blood soaked power grab is sure not going to keep amusing the Borscht-Belt, confussians,Mohamedans, etc., These cross purpose mind sets is what can lead to epochal conflagurations.
USAGOLD
(03/10/2000; 08:04:18 MDT - Msg ID: 26637)
Today's Gold Report: Option Expiration Could Bring Surprises
http://www.usagold.com/Order_Form.html3/10/00 Indications
�Current
�Change
Gold
290.20
-1.20
Silver
5.13
nc
Gold Lease Rate
0.4462%
+0.0075
Gold Comex Stocks
1,373,896
nc


Market Report (3/10/00): Gold was off a bit in quiet trading in
advance of Comex option expiration. Reports from the floor yesterday
characterized the trading as very slow, but Reuters London reports that
some traders expect activity to pick up today."With the COMEX option
expiry of the April contract today and given that the highest
concentration of options are at the $300.00 strike, further gains are
not out of the question," bullion bank N.M. Rothschild & Sons said in a
report. Reuters also reports that "Metals traders Standard Bank London
expected nervous delta hedging activity ahead of the options expiry." In
Europe overnight physical buying and short covering continued on the
dips. Gold was firm in Tokyo and Hong Kong at one point reaching the
$294 level before settling back toward the $290 level.

That's it for today, fellow goldmeisters. Have a restful weekend. We'll
see you here Monday.

If you are looking for a pro-gold view of the various financial markets
as well as a summary of the events affecting the yellow metal, our
monthly newsletter might be of interest. News & Views -- Forecasts,
Commentary & Analysis on the Economy and Precious Metals has
been characterized as witty, urbane, intelligent and down-to-earth. Not
to mention it's Free of Charge If you want to keep up with gold, this
is the way a large segment of the gold owning public does it, and has
done it for over a decade.

Just click the link above and make the appropriate entries.
Leland
(03/10/2000; 09:25:08 MDT - Msg ID: 26638)
Just Watching "Greater Fool Theory" in Action
Asymmetric Pleasure
Why Momentum Is More Fun Than Value

By Francois Sicart

Contrary to a rather vehement accusation left on our
website by a recent visitor, we are not "anti-tech." What
we are against is the purchase of anything without at
least some value rationale. To account for the explosive
growth prospects of some tech companies, we are willing
to stretch our time horizon and assess value on earnings
farther into the future than usual. But, today, many
technology stocks are selling at prices that cannot be
justified by even the rosiest of growth and profitability
scenarios.

Tech Has Been Good To Us

Though value investors, we have had our share of
successes in the technology area. Most often, however,
this has meant accumulating the stocks of premier
companies that had temporarily disappointed an
increasingly myopic crowd. Analysts and financial
reporters have become so hypnotized by quarterly
earnings that they increasingly confuse short-term details
and long-term fundamentals. As a result, companies
faced with transient problems often trade as if they were
going out of business, and that's good for us. I can't
resist mentioning our purchase of IBM at about one-tenth
of its recent highs in 1993, when the experts were
forecasting the demise of this "big box" manufacturer.
At the time, we did not have the input of the younger,
tech-savvy analysts who have joined us since. More
recently, thanks to them, we have done quite well with
sexier names such as Adobe, Hyperion Solutions, 3Com,
and a number of others. All were bought, however, when
the consensus on their prospects had temporarily become
gloomy, with a disproportionate and irrational impact on
their stock prices. Which brings me to my subject for
today.

All Stock Doubles Are Not Equal

I recently received a call from a smart young client who
works daily with technology and is enthusiastic about it.
Yet, he also has a wisdom that is rare among investors of
any age: to abide by our request that clients bring to our
attention new products that they find unusually good or
innovative in their field of expertise, but leave the
evaluation of the companies and their shares to us.
Often, we do not buy the stocks, but our friend has never
complained.

So, last week, on the day of 3Com's partial IPO of their
Palm Pilot subsidiary, this exemplary client called,
curious to know if we still owned our 3Com stock, which
had recently zoomed amid the flurry of news about the
IPO's spectacular market reception. I had to sheepishly
admit that we had sold the stock almost fifty percent
below the current quote (around $95 at the time of the
call). Always the gentleman, our young friend struggled
to hide his disappointment, but this led me to wonder
about the relative psychological rewards of value
investing and momentum investing.

As it happens, although the stock of 3Com had almost
doubled after we sold it, it had also doubled while we
owned it. Yet, with no excitement surrounding the
company, its doubling while we owned it had been
business as usual � an anonymous component of our
contrarian/value portfolios� overall performance. In fact,
if clients bothered to read the financial press, they
probably experienced some anguish at the constant flow
of negative comments by analyst and critical newspaper
articles about the company -- even as the stock had
begun to rise.

Contrast this with the excitement of momentum investors
who bought the stock when we sold it, and enjoyed a
doubling accompanied by accolades from the pundits,
Super-Bowl-style reporting (with instant replays and all)
on the specialized TV channels, and the intense pleasure
of "belonging" when the talk at cocktail parties came to
the subject of 3Com and Palm Pilot.

The Last Laugh

There is no doubt that it's a lot more fun to double one's
money through momentum investing than through value
investing. So, why don't we switch? Because, in the end,
value investing is all about survival and having the
last laugh.

Throughout stock market history, many momentum
investors have known periods of extraordinary glory but,
in essence, they have been traders. And traders, one of
my early senior partners used to say, should have no
opinions. Only the market and their instincts should guide
them and keep them nimble: when they start having
opinions, they become stubborn, and therefore
dangerous.

This is one reason why, as you may have noticed, there
aren't too many old traders around: as they age, they
develop opinions and become stubborn. Throughout the
stock market's cycles and fashions, traders have risen to
stardom only to vanish and be replaced by new
generations of traders. When you look at the few true
investing icons of stock market history, they have been
mostly long-term, fundamental investors. It is they (and
their clients) who have survived. And, among them, a
majority have been value investors.

We Are Not Masochists

Obviously, even though Lord Rothschild reportedly
traced his stock market fortune to this habit, we don't
make a point of foregoing potentially larger gains by
selling too early. In fact, we have made a concerted
effort, in recent years, to become more asymmetrical in
our value discipline (see: For The Record). Specifically,
this means applying very strict value criteria on the buy
side, while loosening them somewhat on the sell side to
allow our winners to run a bit longer. But there is a limit:
at some point, stock prices become so disconnected from
any notion of intrinsic value that our discipline demands
that we sell.

When momentum investors take control of one of our
already-appreciated stocks, further gains become entirely
dependent on the greater fool theory � the assumption
that there will always be a greater fool to buy from the
one who just bought. At that stage, the risk just becomes
too high and impossible to assess. Momentum investing is
great in theory, but you have to be able to sell when you
get a "signal", and everybody will get that signal at the
same time. We know from experience that, when these
investors rush for the exit, the door can be quite narrow.

Mindless Clicking

When we decided to sell our 3Com stock, the Palm
Pilot's initial IPO and eventual spin-off had already been
announced and well publicized. Leading analysts had
already computed likely values for 3Com's components,
and we felt that all the good news was out. This was
counting without the day-traders and the investment
bankers who have turned taking advantage of them into
an art. Let's backtrack a little�

Only months ago, 3Com had contemplated an offering
price of less than $20 per share for Palm Pilot.
Presumably, the people who know it best (including Palm
Pilot's management) thought this represented a fair
valuation of the company. However, in view of the
enthusiasm that preceded the IPO, this was raised in
February to a range of $30-$32, and the offering finally
took place at $38.

Of course, very few investors got to pay that low (!)
price. Most of the 23 million shares of Palm Pilot that
were offered in the IPO (less than 5% of the company's
outstanding total) wound up in the portfolios of hot mutual
funds and hedge funds, which generate huge
commissions for brokers and whose performance has
greatly benefited from the rapid flipping of such offerings
in the last few years.

So, the "public" was left scrambling for shares in the
open market. Of course, 3Com could have offered more
shares. But investment bankers have learned the
valuable definition of a bull market as one where there
are more pigeons than paper: the practice of floating only
a tiny fraction of a company's shares in initial public
offerings has become widespread in recent years.
Assuming decent demand from investors, this guarantees
a somewhat artificial shortage and a bidding scramble by
na�ve day traders.

Thus, the shares of Palm Pilot started trading publicly at
$145, and briefly touched $165 before settling down at
$95 � almost five times what the company itself had
thought the stock to be worth only a few months ago.
The company's entire market float traded 1.65 time on
that one day, as many funds that had bought on the
underwriting dumped their shares onto the day traders.

Now, There's Value

At $95 per share, Palm Pilot sported a total market
capitalization of $53 billion while 3Com, which still owns
almost 95% of Palm (worth $48 billion), closed the day
with a market value of only $29 billion. This means that
the non-Palm segment of 3Com -- the No.2 maker of
computer networking equipment, with promising new
offerings such as high-speed cable Internet access
systems, home networking connections and voice over IP
(a system that transmits phone calls over the Internet) --
was valued on that day at minus $19 billion (- $54 a
share)! This, incidentally, is the segment that repeatedly
has been rumored to be the target of interested foreign
acquirers.

3Com is scheduled to spin off the Palm Pilot shares it still
owns to its shareholders in about six months, once it has
received a most likely ruling from the IRS that the
transaction will be tax-free. So, day traders who believe
that Palm is worth $95 a share should be mortgaging
their homes to buy 3Com, instead of rushing to buy Palm
Pilot. But it is clear that this crowd's clicking fingers are
faster than their brains.

As for us, if the shares of Palm Pilot should by some
miracle hold their current price until the projected spin
off, we stand ready to buy the remaining portion of 3Com
for minus $54 a share. And they say we don't like
"tech"�

Fran�ois Sicart

March 2000
� Tocqueville Asset Management L.P.
Skip
(03/10/2000; 10:01:52 MDT - Msg ID: 26639)
What's Up with Caledonia Mining?
I've noticed that CALVF has tripled in value in the last couple of weeks. Does anyone know what's happening to cause such dramatic growth in Caledonia stocks?

--Skip
Leland
(03/10/2000; 10:18:17 MDT - Msg ID: 26640)
Latest From Silver Institute
National Defense Silver Stockpile Nearly Depleted

February 24, 2000



(Washington, D.C. - February 24, 2000) The U.S. Mint consumed nearly 10.3 million ounces of
silver in 1999 for its coinage programs, dramatically reducing stocks of silver from the U.S. National
Defense Stockpile. Once exhausted, the U.S. Mint must purchase silver for its coinage programs
from the open market, boosting silver demand by up to 1 percent annually. This increased demand
would further widen the gap between overall silver supply and fabrication demand. Between 1990
and 1999, cumulative silver fabrication demand far exceeded mine production, which resulted in
reducing above-ground silver bullion inventories by an estimated 1.25 billion ounces during that
period.

In 1999, the Mint issued nearly 9.5 million ounces of American Eagle Silver bullion coins and proofs
and consumed roughly 460,000 ounces in the manufacture of commemorative coins. Approximately
360,000 ounces of silver were used in the production of 1999 Commemorative Silver Proof Coin
Sets. Some silver is also used in gold coinage alloys, as in the production of American Eagle Gold
Bullion coins, proofs, and gold coin commemoratives.

As of December 1999, the Defense Department's silver stockpile totaled 21.2 million ounces, down
85 percent from its opening balance of 139.5 million ounces. The silver stockpile once posed a
serious threat to the market when government officials determined it was no longer needed and that
domestic silver production combined with reliable imports could sustain the United States in the
event of an emergency.

In the early 1980s, the General Accounting Office (GAO), an investigative arm of Congress,
recommended that silver from the stockpile be used for coinage rather than sold on the open market.
GAO's proposal assured that using silver to mint a bullion coin and other forms of coinage would
minimize or eliminate any short-term market price disruption by developing new demand to offset the
increased supply. GAO's proposal was implemented when Congress created the American Silver
Eagle bullion coin in 1986 and specified that metal for the coin be drawn from the stockpile, unlike
the Gold Eagle for which the U.S. Mint is required to use newly mined gold from domestic mines.
Annual Silver Eagle sales have significantly accelerated the reduction of silver from the stockpile,
using nearly 91 million ounces since it was created 14 years ago.

As bullion coins, Eagles are considered legal tender by the United States government and
their silver content is guaranteed. The $1 face value of an Eagle is largely symbolic since its market
value depends totally on the silver content. In addition to the Eagle, the U.S. Mint has struck silver
coins commemorating events and people ranging from Christopher Columbus, Dolley Madison, the
Olympics, and the Yellowstone National Park Silver Dollar.

The United States was the largest single user of silver for coinage in 1999. Having consumed almost
120 million ounces of silver over the past 19 years, the U.S. Mint is one of the largest silver users in
the world accounting for more than 1 percent of worldwide demand during that period.



For Further Information Contact:

Mike DiRienzo
The Silver Institute
1112 16th Street, N.W., Suite 240
Washington, D.C. 20036
Tel: (202) 835-0185
Fax: (202) 835-0155

Gold Trail Update
(03/10/2000; 10:51:53 MDT - Msg ID: 26641)
The Gold Trail Discussion has been Updated
The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Holtzman
(03/10/2000; 11:28:00 MDT - Msg ID: 26642)
Pensive Moods
Holtzman here,

--------------
Moods
--------------

To USAGOLD regarding (3/7/2000; 19:50:03MDT - Msg ID:26509). What's the mood in Britain, you ask? It depends with whom you speak. There's a general resignation that world events will proceed whether we approve or not, but that's a fair description of the general mood in any country in any era. At one extreme there are those who are champing at the bit to become Europeans. At the opposing extreme are those who live in terror of same. In the middle are the vast majority who, probably rightly, feel it won't substantially change their lot in life.

They have only to look across the Irish Sea to see what lies ahead. Every business article in Irish newspapers bears a sentence lamenting Dublin's lack of influence over ECB policies. But again, to the average Irishman, he had no influence over Dublin before 1999, so his lack of influence over the ECB nowadays is neither an improvement nor a worsening.

The failing of the masses in both countries is that they take no action to assure themselves that they'll at least survive the transition. They either place blind trust in their betters, or they cynically expect that nothing they attempt will make any difference.

There are a few of us, though, who actively attempt to position ourselves so that we survive, and hopefully thrive, regardless of the outcome.

These attitude divisions cut across all strata of the population, both here and abroad. Sheeple come from all walks of life, and so do knights at this Round Table. How many people in the U.S., doctors and dustmen alike, regard the upcoming election as an event of either salvation or utter defeat? How many regard it as largely irrelevant? How many people at this forum lack a wall full of diplomas, yet have more than sufficient wisdom to actively study their world for signs of impending change?

There has been recent discussion of Britain pulling a fast one on Euroland and, rather than adhere to the Euro, instead adopt the U.S. dollar. Again, the range of responses has been profound. The vast majority in the middle don't care, those at one extreme are mortified at the thought of the mother country ultimately becoming a colony of the Colonies, and those at the opposing extreme are thrilled at the thought of trading with the largest English-speaking economy while no longer needing to resort to currency hedging. Finally, those like me have attempted to spread our investments across the pound-denominated world, the dollar-denominated, and the euro-denominated, so that on average we'll survive no matter the outcome.

I must admit, I do appreciate the phenomenal irony of George III's successors possibly passing around banknotes with George Washington's face on them. The old king would twirl in his grave. But the odds of it working out that way are, in my opinion, rather slim. Geography will win out in the end. Even with Britain's and America's long history of efficient sea trade, France is just the other side of the Chunnel. We may prefer to ally with other English speakers, but our predecessors put you and the Aussies too far away. Like it or not, free trade with our nearest continent is the most practical way to go.

As regards gold, again there's the distinction between the masses and the wise. At one extreme, there are those in the UK who genuinely feel that gold is another vestige of the old economy which, in the new economy, is viable only as a highly conductive coating on electrical circuits. At the other extreme, there are those of us who feel it's only a matter of time before the virtual economy finally experiences a moment of clarity and the currency of gold begins to look attractive by comparison. The most recent shock on Wall Street evidently was caused by the devaluation of a single old-economy stalwart, Procter and Gamble. Leave aside the Wonderland wherein dot coms trade, the American frenzy had driven mere soap up to a price/earnings ratio of 40. Even after the shock the P/E remains half again higher than its historic norm. Soap's not worth that much.


--------------
Pushing on a string
--------------

To USAGOLD, who wrote in (03/04/00; 16:51:08MDT - Msg ID:26370) that, "Have you fellows begun to notice that fewer and fewer of the economic indicators that we once viewed as crucial to any legitimate economic analysis just don't matter anymore. Deficits... Money supply... Bubble stock markets... Oil..."

The sensation you're describing reminds me of what happened one winter's night when I was 19 and overly eager to return home from university for Christmas. Icy rain was falling but I was in no mood to be halted by mere weather. In my haste, however, I'd neglected to take into account two important facts. First, bridges often freeze well in advance of motorways. Second, in the darkness ahead lay one more bridge than I'd recalled there having been on that journey.

The next few seconds of my life seemed to require the better part of a century to pass. The time dilation began when it suddenly occurred to me that I was proceeding in a perfectly straight line and that, unfortunately, the road wasn't. I recall marvelling at being able to steer both left and right without exerting the slightest influence upon my trajectory. I recall standing on the brake pedal with both feet, also to no avail. Fear hadn't set in yet. The main thought running through my head during those long seconds was an almost dispassionate, "I hate this." Finally, it ended. And, luckily for me, in a soft landing. When finally the world stopped moving round me, I found I'd lodged myself in a surprisingly deep accumulation of mud alongside the motorway on the far side of the bridge.

Though my life was no longer in immediate peril, I found that my ability to influence my world had not improved substantially. The tyres found no more purchase in the mud than they had on the ice. It took outside aid to extract me from my predicament. But, as the saying goes, that which did not kill me, only made me stronger. In the decades since, I've so far managed never to let myself get into that circumstance again. And that, I believe, is how the cycle of economic Depression functions.

--------------
Depressions occur when we forget
--------------

I recall various pundits in the late 1970s and early 1980s confidently declaring that Depressions were cyclical and tended to set in at roughly 60 year intervals. Following that logic, we were then about due for another one. But a further twenty years of roaring success ensued. What was wrong with the prediction? I think it was lifespans.

I suspect that a new Depression occurs in a particular population when all the survivors of the previous Depression become too old to sing out about the warning signals. The argument for a fixed 60 year cycle failed to take into account the medical advances of the 1900s. Prior to the 1900s, very few people lived 60 years, and most of them were reduced to dottering infirms by that advanced age. As a result, 60 years after any particular catastrophe, there was no significant living memory of the event. Since children in any age are unwilling to believe they could fall prey to what felled their grandparents, we've over and again followed our predecessors right back into the same trap.

The main thing that's different this go-round is the longer lifespan. We have a ruling queen in her 70s whose mother is looking forward to 100 this summer. The average person in the industrialised world can look forward to living about 75 years. That means the gap from the previous Depression ought at least to be 75 years and possibly upwards of 90. That places us squarely in the window today.

Must it happen again? No. But does anyone think the likelier scenario is an infinite future where deficits, money supply growth, bubble stock markets and soaring oil prices don't matter anymore?

History never repeats precisely. For example, there was no internet in the 1920s... but there was wireless. RCA was a 1920s dot com. Or perhaps more accurately, a Microsoft. Germany was the basket-case economy in the 1920s while Russia plays that role today.

Must we suffer? Absolutely NOT. During the last Depression there were many people who were not trampled, who were not destroyed. Some of these people were simply lucky. Others, though, were those rare individuals who grew up listening to their grandparents. If your grandparents aren't with you anymore, you'll find books, even historical fiction, will help you regain much of the wisdom gleaned from those difficult times. In fact, the child's story of the ant and the grasshopper is an excellent illustration of what's going on today.

--------------
Diversify into what?
--------------

To Cavan Man, who asked that question in (03/04/00; 20:42:02MDT - Msg ID:26382), my answer is: a little bit of everything. The notion of diversification is to protect Most of what you own by scattering it over a wide area. You have to let go the notion that you can safeguard 100% of your wealth at all moments. There is no single investment which is completely safe at all times. But at any given moment, some investments are rising in value as others fall. If you are widely allocated across them all, on average you'll survive and progress while humanity as a whole marches forward.

In practicality, it's not necessary to be invested in everything under the sun. Few investors outside Iceland have holdings there, and the presence or absence of Icelandic assets most likely results in no significant effect on their overall portfolios.

But it is wise to have some money in at least several of the major Classes of asset. Classes include stocks, bonds, cash, commodities, real estate, etc. That by no means is meant to suggest that safety can be achieved by allocating one's wealth across dot coms, junk bonds, Russian roubles, paper gold and the deed to a dacha in eastern Ukraine. On the other hand, not a thing in that previous sentence is always a bad investment.

The trick is to identify those things which have had the overvaluation beaten out of them, but which are now poised to at least not fall much further and, someday within our lifetimes, rise again.

As you can see, I fancy myself a value investor. When the popular press uses the phrase "Twenty Year Low" to describe something's price, I'm willing to bet that's a bargain. Physical gold falls into that category, and in the unhedged cases so too do many of the mining stocks. By contrast, when headlines cry out "The Sky's the Limit," I'm ready to run for my life. Overly expensive soap, even after its recent plunge, still falls into the category of Best Avoided.

Nations take the same broadly diversified approach to their possessions, but with a twist. Real estate obviously is their core holding, though more liquid forms of wealth are carefully acquired as well, and are expended at need. The Bank of England has come under suspicion of stupidity as regards its ongoing sale of gold. Surely they see it's at a 20 year low. Why not sell some other asset which is more ripe for sale? Because governments aren't investors, and their goals are not those of you and me. The BoE has as its prime obligation the maintenance of order, not the acquisition of maximum profit.

They've evidently concluded that, in order to accommodate some larger (and as yet not obvious) need, it's necessary to present the image that the UK, like Belgium, no longer needs vast amounts of gold gathering dust in vaults. Keep in mind, the BoE's gold holdings seem vast to us but are well less than one per cent of the assets they could muster at need (both from their own coffers and from those of other governmental entities). They're expending gold today in the same way that you occasionally choose steak over hamburger. It's not a particularly big concern from their point of view.

I don't know what their larger concern is specifically, but it's likely involved with either smoothing our entrance into Euroland, or staving off market instability, or some of both. Whether the gold sales are later seen as an appropriate sacrifice, or as throwing good money after bad, is something only time will tell.


--------------
You say you want an evolution?
--------------

To USAGOLD, who asked other questions in (3/7/2000; 19:50:03MDT - Msg ID:26509). It's regrettable, but inevitable, that individuals go the way of the dinosaur, in the sense of becoming extinct. Margaret Thatcher still speaks her mind, but is listened to less and less because she's ageing. While, to be sure, she's ageing less precipitously than Boris Yeltsin and Ronald Reagan, still with each passing day her ability to influence affairs wanes.

There's a folk singer over here named Al Stewart. I think Year of the Cat made it to America, but I doubt anything else of his did. I especially like one of his songs about a retired admiral who sees the 1914-1918 war coming, and yet cannot get anyone to listen to him: "the war, it ran its course, they could find no use for me. And I live in the country now, grandchildren on my knee. And sometimes think in all this world the saddest thing to be... old admirals who feel the wind, and never put to sea." Until they scripted a movie to say otherwise, I'd always pictured Jim Kirk going out that way, but Old Admirals applies just as tragically to anyone in the real world who's no longer appreciated.

Empires, on the other hand, go the way of the dinosaurs in the sense that dinosaurs stopped being rulers of the earth yet remain among the new rulers (mammals) to this very day, merely in new forms (they became birds). In a song called All This Time, another singer, Sting, wrote a rather haunting stanza about London: "The teacher told us, the Romans built this place. They built a wall and a temple, an edge of the empire garrison town. They lived and they died, they prayed to their gods, but their stone gods did not make a sound. And their empire crumbled 'til all that was left were the stones the workmen found." The empire fell, yet the descendants of Roman citizens flourish all over the world today.

Along the same lines, and more timely here in the year 2000, is another of Al Stewart's lines: "and the world goes to Riyadh... today."

Empire is never a permanent thing. Rome was the hub of empire for a thousand years, while Londinium was an edge-of-the-empire garrison town. A thousand years or so later, London was the hub of empire, while the Maryland/Virginia border was a swamp. Living the good life in Claudian Rome or Victorian England or 1950s America required finding one's place in society and excelling there. Living the good life in the declining years of any empire requires adopting a more mercenary mindset. It's often bemoaned in the press, "There are so few statesmen today, and so many politicians." Such is typical when the bloom is off the rose in an empire.

Is the UK an empire anymore? No, clearly not. It's a loose commonwealth little more co-ordinated than the orphaned Roman provinces or the former USSR. Does that matter to living Britons? Not particularly. The worst is over in that regard: the UK is simply a nation now, a province looking for another empire to which to adhere. Naturally, we happen to think we ought to be first among equals in any such adherence, and that may cause any transition to be a bit bumpy, but in the main I think we're resigned to accept what history has left to us, as did Italy, Spain, France, Germany, Japan, and most recently Russia.

Is the U.S. an empire anymore? Yes, for the present. How long will it retain imperial (superpower) status? Difficult to tell. These things seldom end in a single day (with the notable exception of Japan). Often it requires a century. If we define the start of an empire's decline as the moment when it ceases to grow, that date for the U.S. may well have been set by the ascension to statehood of Hawaii. That marked the last time the U.S. absorbed another nation and made its citizens Americans. Having said that, the U.S. has yet to stop placing edge-of-the-empire garrison towns throughout the world (Bosnia, Haiti, Kosovo, Ecuador, next?), so maybe the empire is not finished quite yet.

The U.S. is in many respects like Rome. The U.S. did to Japan and Germany roughly what Rome did to Hispania, Gaul, and so on: overwhelmed and devastated them, then rebuilt them from the infrastructure up as carbon copies of the imperial hub. NATO is surely the modern equivalent of Pax Romana, and though the rest of us might have imagined ourselves as having equal voting rights in NATO, it's fairly apparent that the whole thing was a U.S.-run show throughout the Cold War. You've spent the past century spreading your cultural ideals, much as the Romans did. I'll grant your notions of human rights are quite a bit more decent than those presented by Rome, but both of you tended to push those notions on your neighbours without bothering to ask whether they would be appreciated.

In both empires, centuries-long monetary devaluations were made palatable by the provision of cheap food and entertainment: bread and circuses for the Romans, government subsidised cheese and wrestling for the U.S. One current U.S. state governor is a former gladiator who leaves open the option of returning to the arena some day. One of the U.S.'s recent presidents was an actor. Most U.S. television programmes are at least as violent (and as carefully we-they) as were Roman arena spectacles. I'll leave it to you to continue the list of parallels, for there are quite a few of them.


--------------
No need to be pensive
--------------

Speaking of monetary devaluations, the much anticipated (or dreaded) U.S. Golden Dollars are truly nothing much to become excited about. Why?

First, despite all political attempts to call them Golden, these coins will not remain even remotely so once in circulation. They will quickly acquire a colour not unlike the oddly-shaped Three Pence coins which were minted in Britain from 1937 to 1967. For those of you who've never seen one of these beauties, their circulated patina can best be described as that of oily mud. As best I can tell, they're where the term "brass in pocket" came from.

Second, this new U.S. coin is a dollar in name only. In practice, in purchasing power, it's a larger, slightly less unlovely repeat of the Three Pence.

What was the value of a Three Pence back then? A pence by definition was one 240th of a pound of sterling silver and at the same time one 240th of a single gold sovereign (a sovereign being .2354 of a Troy ounce of gold), so a Three Pence back then was worth one 80th of a single gold sovereign.

How much does a single gold sovereign cost in terms of dollars today? In the neighbourhood of $80. As I said, this new "Golden" Dollar is today worth approximately what one of those ugly Three Pence coins was worth: one 80th of a factually gold sovereign.

It seems to me that's the true message behind this new coin.

Yours,
I.V. Holtzman

PS: Here's the only colour URL I could find of the British Three Pence: http://sr2.xoom.com/talshiarr/britishcoins/Geo6-3d-1940brass-rev-xpar.gif

And here's a URL of the new dollar: http://128.192.145.172/US/one/000pus1dc.jpg Doesn't look particularly golden, now does it?

PPS: Someone recently posted that sovereigns have no face value minted onto them and so therefore are somehow free-floating in value. The premise is true, and the conclusion is true, but the one is not the cause of the other. The sovereign size (.2354) was chosen as the amount of gold which, in 1700s-era purchasing power, was equivalent to one pound of sterling silver. A sovereign was a �1 coin just like the U.S. St. Gaudens was a $20 coin. Sovereigns were used precisely as �1 pieces so long as the Empire maintained its original gold standard. Since then, like the St. Gaudens, their gold content value, and numismatic value, have caused their resale prices to float independent of their original face value.

PPPS: Did you know that a Rothschild recently began investing in dot coms? This fact alone should tell you that these people are not the ever-correct gods they're sometimes mistaken for. Centuries of inherited wealth evidently have not helped him resist the call to invest at the top of a bubble. He may ultimately lose the vineyard as a result.
ORO
(03/10/2000; 11:28:26 MDT - Msg ID: 26643)
CALVF
http://biz.yahoo.com/p/c/calvf.ob.htmlThey should be releasing a quarterly towards the end of the month - if it is like this info:

"For the six months ended 6/30/99, revenues increased 3% to C$7.4 million. Net income totalled C$4.8 million vs. a loss of C$816 thousand. Results benefited from improved production of silver at Filon Sur Gold mine and a C$5.3 million gain from the retirement of long term debt."

It seems that the next step would be to make an actual profit rather than book generated adjustments to a negative cash flow.

http://www.caledoniamining.com/cal3q.pdf

"Spain
During the third quarter of 1999, the Filon Sur gold mine produced 7,931 ounces of gold and 46,682 ounces of silver as compared to 7,555 ounces of gold and 45,878 ounces of
silver during the same period of 1998. Total production for
the first nine months of 1999 is 24,535 ounces of gold and
161,050 ounces of silver as compared with 23,464 ounces
of gold and 158,319 ounces of silver during the first nine
months of 1998. Production of gold in the third quarter
improved over that in the second quarter due largely to the
higher head grade of 1.68 g/t gold. Dry tonnage of ore
crushed during the third quarter of 1999 was 243,227
tonnes as compared to 249,544 tonnes in 1998.

"Other
Discussions to finalize the formal Joint Venture agreements with the BHP Entity (BHP World Minerals Inc. and its affiliate Motapa Diamonds Inc.) on the Mulonga Plains properties in Zambia and with Northern Empire Minerals Ltd. on the Kikerk Lake property in Nunavut, Canada are continuing."

Their exploration activities could have resulted in anything.

This gold company used to be a great fav of the microgold speculators during 1998.

"In response to the continued erosion of revenue from gold production in 1997, which averaged
$327 US per ounce for the year, and in accordance with the accounting policies of the Corporation, a write-down in
the carrying value of various assets was recorded in the accounts. From 1992 to 1997 the Corporation has recorded
write-downs in accordance with this policy of approximately $67.9 million or 95% of the $71.8 million accumulated
deficit present as at December 31, 1997. During the fourth quarter of 1998, a further write-down of $ 46.0 million
on mineral properties and capital assets was recorded in the accounts reflecting the impact of the continued decline
in revenue from gold production which averaged $ 296 US per ounce for 1998. As of December 31, 1998, 93% of
the accumulated deficit of $ 122.3 million is attributable to write-downs of mineral properties and capital assets."

http://www.caledoniamining.com/annual.pdf

This is the recovery potential in NAV at gold POG of $400, which comes to an extra $1.2 per share on top of the current value of its operations - which are cash positive at current prices but for corporate overhead and exploration activity.

The mineral resources are at 0.05 oz. per share or $6 per ounce, and $55 per ounce for operational mine reserves. Of which 0.006 oz per share are worth $0.04 as current production at current prices.

They have a collection of 8 exploration properties, mostly of metals (Cu, Cb, Au, Ag, C4=diamonds) that are showing some encouraging results. Info may be leaking on some hits. Found nothing on the Chat spots I checked. They have a strong history of successful findings but were clobbered by the low gold prices and have not released any info on current exploration activity in a while.

Bottom line, WHO KNOWS?

I certainly don't.

I can say that at $0.05 it was a bargain. At $0.30 it ain't so hot unless they landed a good deal to develop their big reserves or had a good new strike, they still have space to make discoveries of up to some 10 mil oz of gold equivalent resources. This does not mean that they can actually find that amount or that the amount is there at all.

Clueless...
MarkeTalk
(03/10/2000; 13:17:08 MDT - Msg ID: 26644)
China to retaliate against U.S. firms
http://208.246.212.80/business/news3-03102000.htmChina appears to be more brazen and arrogant as the Taiwanese elections approach. Now China is threatening to retaliate against U.S. firms if it doesn't get its WTO entry. This bullying might just backfire in Congress. However, the real ace up the sleeve is China's massive holding of U.S. treasury obligations--somewhere above $100 billion--which could be dumped on the market (or threatened to be dumped). This action would drive down the U.S. dollar which is looking toppy now according to cycles and chart patterns. Chinese elections take place on March 18th, so watch for highs in the Dollar around this time. Any weakness in the Dollar would be a boost for gold.
ORO
(03/10/2000; 13:53:04 MDT - Msg ID: 26645)
BIS interbank debt position report
http://www.bis.org/publ/r_qt0002.htmRegular Publications


Quarterly Review: International Banking and Financial Market Developments
(February 2000)

INTRODUCTION
The fourth quarter of 1999 marked the culmination of a year of rising equity prices, climbing bond yields and easing credit spreads. These developments reflected increasingly sanguine market expectations about the global economy. Not only did market participants see improved growth prospects in most regions, they also seemed assured about the ability of monetary authorities to keep inflation in check without pushing economies into recession. Concerns that the millennium date change might disrupt market functioning dampened market activity, but these concerns were allayed once central banks in general took operational measures to ensure that liquidity would be provided if and when appropriate. In the event, the new year arrived without significant market incident.

Spreads on interest rate swaps were among those that eased during the fourth quarter. This particular development was especially notable, because hedging activity associated with a surge in corporate bond issuance during the summer had inflated such spreads to unusual levels. Even after their recent decline, these spreads have remained high by historical standards. The behaviour of the swaps market may have signalled broader changes in market functioning and pricing relationships in private and government debt markets, changes stemming from the market turbulence of the second half of 1998 and current and prospective supply trends in the two types of markets.

The weeks surrounding the turn of the year highlighted how quickly market sentiment can change. By the end of the fourth quarter, stock and bond markets seemed to be brimming with confidence about the ability of monetary policy to engineer a soft landing in the United States and support non-inflationary growth in Europe. The month of January 2000 found the very same markets wavering in their views. European and US bond yields rose sharply on evidence of unrelenting strength in the US labour market and on news of continued increases in oil prices. The prospect that monetary tightening might be more forceful than initially anticipated led to a sell-off in the US stock market and heightened volatility in other equity markets.

Newly released comprehensive BIS data on the international banking market for the third quarter of 1999 show the largest volume of net lending ($188 billion) since the second quarter of 1998. The rebound was driven largely by a resurgence in the interbank market among industrial countries, in which the absorption of unusually large repayments from non-bank borrowers led to a temporary expansion in interbank balance sheets. By contrast, the third quarter saw the sharpest decline in claims on emerging market borrowers since the credit squeeze that followed the Russian debt moratorium in the third quarter of 1998. This time, however, the decline seemed to be driven by a shift in the demand by these borrowers away from bank loans to securities issuance. Aggregate activity in international syndicated loans declined in the fourth quarter in spite of a rebound in merger and acquisition deals.

Notwithstanding the more favourable credit spreads, gross and net international securities issuance declined in the fourth quarter of 1999 after three quarters of record activity. Although an increase in the amount of debt needing to be refinanced supported gross issuance, announcements of bonds and notes still declined by 25% (to $310 billion) relative to the previous quarter. The slowdown reflected primarily a front-loading of activity to earlier quarters and a postponement of other issues to the new year because of concerns about possible market disruptions related to the millennium changeover. Net issuance fell by 37% (to $193 billion), but was still twice as large as that in the fourth quarter of 1998, when activity had slowed amid generally adverse market conditions and in anticipation of the introduction of the euro. The euro's weakness in 1999 did not prevent net issuance in the currency from increasingly outpacing that in US dollars.

The aggregate turnover of exchange-traded financial derivatives monitored by the BIS contracted by 17% in the fourth quarter of 1999 (to $76 trillion), the lowest level since the fourth quarter of 1996. The dominant influence in the fixed income and currency market segments appears to have been the effort by market participants to pare down their positions to a minimum ahead of the new millennium. The main exception to the downward trend took place in the area of equity-related instruments, where the record levels reached by equity indices led to a widespread increase in the value of turnover.

An analysis of spot and forward FX trading volumes suggests that the introduction of the euro has not to date caused major changes in FX market activity. Results from an informal survey among market participants and information from electronic brokers indicate that the importance of the new currency in FX trading roughly matches that of the Deutsche mark before 1999. In particular, the reported share of trading in euros against dollars in October 1999 was about the same as that of dollar/mark trading in April 1998. Furthermore, the share of euro/yen trading still accounts for only a small part of the total market. In emerging market countries, the role of the euro so far seems similar to that of the mark, being confined mainly to eastern Europe. Outside eastern Europe, FX transactions involving the domestic currency are currently conducted mainly against the dollar.


Hopefully this has not been posted before.

TownCrier
(03/10/2000; 14:07:12 MDT - Msg ID: 26646)
The Fed's daily add...
The Fed gave the banking system a little room to breath with a term repurchase agreement instead of an overnight RP. Specifically, the Fed added $2.850 billion to reserves via 7-day system repos.
TownCrier
(03/10/2000; 14:08:12 MDT - Msg ID: 26647)
Here's the missing "e"...
e
Seric
(03/10/2000; 15:44:05 MDT - Msg ID: 26648)
Smoking
http://home1.gte.net/elvish/smoking.htmHi, I have been reading this list for awhile now. When I saw the discussion turn to smoking I decided I should add some input. The reason this is late, is because I had not posted before, and had to wait for a password. And, may I add this is one of the coolest boards out there. First, I would like to say I do not smoke. But, I believe in freedom, thats why I'm a goldbug, because it is "free" money, in that it can not be made by the government. Liberty is important. I have a web page (over 2 years)concerning the smoking issue.
http://home1.gte.net/elvish/smoking.htm
If you do not defend the rights of those you disagree with, then your rights will be next.

In Peace and Honor
David Hintz
www.DavidHintz.org
Mr Gresham
(03/10/2000; 16:07:17 MDT - Msg ID: 26649)
Trail Guide
Can you explain now your preference for pre-33 non-legal tender coins?

Gotta run -- looking forward to a late night reading of today's juicy posts, and a stimulating weekend ahead on our forum.

Hipplebeck
(03/10/2000; 16:29:19 MDT - Msg ID: 26650)
good lecture on gold, money, and such
http://www.polyconomics.com/She even has a plausable model of a gold standard dollar.
Gold Trail Update
(03/10/2000; 17:00:47 MDT - Msg ID: 26651)
The Gold Trail Discussion has been Updated
The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
4Ducat
(03/10/2000; 18:03:31 MDT - Msg ID: 26652)
Questions about China
http://www.usagold.comDoes anyone have an idea of what will happen to the dollar if China takes over Taiwan as to how it could effect tech industry?

Do we have and indications that China would back down from taking Taiwan if it would keep them out of the WTO?

Do they really care about the WTO?

I don't keep up with enough accurate news sources to develop a knowledgeable opinion. Sincerely, 4-Ducat
Harley Davidson
(03/10/2000; 18:36:35 MDT - Msg ID: 26653)
4Ducat, your Message ID:26652 RE: China
It seems obvious that China wants Taiwan because of the value in terms of tech business that Taiwan has. If Taiwan was an island with a bunch of natives running around, I don't think anyone would be particularly interested.

While its just speculation on my part, I think they will get both Taiwan and entry into the WTO. The Senate just narrowly agreed to pass the bill to allow them into the WTO. Its up to the House of Representatives to shoot it down.

Support for entry into WTO is driven by US businesses. If assurances are given that there would be minimal interruption of trade, and China certainly would try to avoid any interruption of dollar inflows, Taiwan is lost.

It amazes me that Clinton is pushing for China/WTO at the same time China is threatening to nuke us if we intervene in their invasion of Taiwan. I don't buy the "lets accommodate the younger, less political faction who is more interested in doing business than communism" argument in an effort to lead China to become a more democratic country.

The threat to nuke us should be sufficient reason to set them back 20 years in their effort to enter WTO. After all, we bomb the hell out of Iraq in the expectation that the people will revolt against Sadam Hussein, why change policy for China... unless our administration owes them something.







TownCrier
(03/10/2000; 18:55:28 MDT - Msg ID: 26654)
Meet your host...Centennial Precious Metals
http://www.usagold.com/cpm/aboutcpm.htmlSome of the long, late-night hours we've been putting in atop The Tower are starting to come to fruition. You'll be seeing more changes as time rolls on, then we hope to be able to contribute more to the news and discussion here at the Castle's round table.
TownCrier
(03/10/2000; 19:05:50 MDT - Msg ID: 26655)
New Home Page for your ease of navigation
http://www.usagold.com/Sorry you had to wait so long for these improvements.
Harley Davidson
(03/10/2000; 19:38:48 MDT - Msg ID: 26656)
Mr Gresham, your message ID:26649, you said...
"Trail Guide, Can you explain now your preference for pre-33 non-legal tender coins?"

While I can't answer for TG, my take is that if the government reaches a point of crisis where it determines that it needs all of the gold held by the US citizens, I don't believe it will matter what date is stamped on the gold.

After all, it will be mostly the minority wealthy that have those coins in volume and, if it is determined to be in the national interest, confiscation would not be biased. All gold, jewelry, coins, all gold could be taken. Since the last confiscation, American citizens have lost their liberties not gained them. I certainly wouldn't count on the government to be benevolent and consider my coin collection as hands off. If it is determined that they need gold, they will take it...if they can.
Elwood
(03/10/2000; 20:08:41 MDT - Msg ID: 26657)
USAGOLD, way to go!

To USAGOLD,
Great new site, MK. Where'd you get the drawing of Chuck Norris? ;-)

To Harley Davidson and 4Ducat,
China is going through many of the pains that the old Soviet Union did. Communism is an unworkable system especially under fast-changing technological advance. If they attempt to assimilate Taiwan their system will fall all the faster. The world will be better for it.

To Hipplebeck,
Jude Wanniski. is a man. I made that mistake too. ;-)

To Trail Guide,
Appreciate the walks and fireside chats. I'm trying not to get impatient in predicting what the new international system will look like. If the dollar falls, wouldn't other nations want to see payment for their produce in gold and not Euros? Fool me once, shame on you. Fool me twice, shame on me.

To ORO,
Your posts got me started. Against my better judgement I took a flyer on SEMI and did good in the recent move. I wish you hadn't done that. Took the profits and dumped them into more physical though. Was fun, but trying to keep myself from doing it again. ;-)

Elwood
Cavan Man
(03/10/2000; 20:10:29 MDT - Msg ID: 26658)
Trail Guide
Browns' or Rainbows', makes no difference to me. Truly though, try the grilled salmon. The Docs say it is one of the ten best foods a person can eat.

Question; could it be that exporting countries (to US) did not inflate their own currencies and give purchasing and consuming power to their own citizens because of the size of their respective markets? For example, take an average french bordeaux. Although the French are known for their per capita consumption of the grape, their productive vineyards and winery operations far outpace in supply what local demand can absorb. Also, with so many of their neighbors exporting on the cheap to the US, their target market, the citizens of those neighboring countries could not absorb the french grape either. Rambling along on the trail, perhaps I've answered my own question. That's why the Euro yes?

Oh, BTW, I don't think your commentary is "provocative" :-)
Journeyman
(03/10/2000; 20:27:36 MDT - Msg ID: 26659)
Two out of three ain't bad?? @Simply Me

"IMHO...the only three good things that have ever come out of Federal Government are the
Emancipation Proclamation, the Interstate Highway System and the Internet. And all three were
begun for National Defense NOT for the benefit of the people. Our government has NEVER
intentionally DONE ANYTHING that purposefully INCREASED the LIBERTY of the people." -Only 3
good deeds in over 200 years! Not a record to be proud of, Simply Me (03/10/00; 00:17:03MDT
- Msg ID:26626)

The final version of the so-called "Emancipation Proclamation," because of political
pressure, made no mention of freeing the slaves. Two out
of three??

Regards,
Journeyman

of freeing the slaves
canamami
(03/10/2000; 20:41:54 MDT - Msg ID: 26660)
Reply to Oro re BIS report
Oro,

The BIS report's conclusion that the euro's share of forex activity is the about the same as was the Dmark's. Does this impact or have anything to do with your theory that dollar debt is being paid off and redenominated in euros?

Thx,
canamami.

Dollar Bill
(03/10/2000; 21:32:08 MDT - Msg ID: 26661)
Metropole Cafe and China Tea
This cheery bit of news is courtesy of the Metropole Cafe.
In 1970 debt in america was 1.5 trillion
In 1990 it was 12.3 trillion. Now it is over 25 trillion.
In news from other sources, europe needs an inflation rate of 2%. Oil is propelling inflation throughout the whole system although it is not showing yet. Except of course at the pump. The inflation from oil will likely cause the long delayed next recession to finally show up and the debt load maintenance and credit creation mechanisms will undergo stress testing with unknown results. People who predict have been saying that either we will have an inflationary or deflationary spiral
I guess the oil price will be a factor in it being an inflationary spiral. Perhaps this chess move of oil price rise helps a few problems for the big boys while creating other problems. (for the small guy as usual).

Ive read that China has a lot of production that is actually in the red and thier banks are if effect paying (loaning) the companies to sell products at a loss. Chinese banks are very deep in the "red" and they are trying to get on a smart path. They did not devalue thier currency and were under pressure to do so. They agreed to go along with the gold priceing fiat big boys and have agreed to a dollar recycleing program. We can thank nixon for makeing them more formidable chess players. He thought it was his holy mission to educate the chinese leadership and his ego tripping and efforts have had very mixed results. They will have a mixed bag of results by joining WTO but it is vital for them. Sorry I cannot recall the details on why. The one china policy says that both countries will reunite SOMEDAY and only peacably, chinks know that, and are making noise to make sure taiwan keeps agreeing to eventual reunification
the invasion noise is just chess postureing.
Gandalf the White
(03/10/2000; 23:08:37 MDT - Msg ID: 26662)
news
Release Date: Mar 10 2000
NY Merc Lists An Additional Strike Price For Gold Options

NEW YORK, N.Y., March 10, 2000 - The New York Mercantile Exchange listed an additional gold options strike price today of 350 on the May 2000 contract.
The recommendation to list this strike price came from the Exchange's floor committee since it would not have been listed under the regular parameters of the Exchange gold options contract.
===
<;-)
ORO
(03/10/2000; 23:22:57 MDT - Msg ID: 26663)
Canamani - BIS
http://www.bis.org/publ/qcsv0002/anx5a.csvDoes the currency trade volume make any difference for the theory of dollar debt displacement by the Euro?

No, because trade volumes are about the same, and OLD outstanding debts have not changed that much (though the portion of NEW debt that is in Euro has changed), it stands to reason that we should not see the change in currency trade patterns. The effects of the changes are only apparent in the upwards pressure on the dollar. While the exchange rates are predominantly a matter of trade flows, the volume of trade is related to the size of outstanding positions that are rolled over and hedged periodically.

The above link contains the data. It shows the dollar debt growth in inter-bank cross border accounts at near 0 through most of 1999, giving a 4.9% growth rate Y/Y (contrasted to a usual 10%), while the growth rate of Euro accounts was 8%-20% through most of 1998-9 and gave 10.9% Y/Y growth for the 1999 average (7.7% Y/Y for Euro for Q3 99 growth vs. 0.1% Y/Y for dollars).

Because of the bank debt being rolled over fairly quickly because about 60% matures in less than one year, the 7.7% for the Euro is added to the 60% to form a 67.7% rate of churn, and the dollar sits at juat over 60%. Therefore, dollar production vs. demand ratio is 17% lower than that of Euro. That would be (New debt + roll over rate) / (roll over rate + interest rate)

For Q3 99 in Y/Y figures:
For the dollar:
(0.1% + 60%)/(60% + 6%)=0.909
For the Euro:
(7.7% + 60%)/(60% + 3.5%)=1.067

1.067/0.909 = 1.17

So that a 17% relative declines in Euro vs. dollar would be expected to occur Y/Y if only bank activity is considered. Since the bond markets display similar ratios - or even more skewed ratios to the dollar, then the 17% decline rate should be an underestimate. Trade and investment flows are near 0 net between the EU and the US when compared to the debt markets and should have little effect unless Europeans stop investing in the US, or the US goes even more overboard with imports of Italian leather and German auto and lab equipment.



4Ducat
(03/10/2000; 23:25:13 MDT - Msg ID: 26664)
Schippi check this out.
http://www.usagold.ccomI know you are into charts in a big way. Compare DNCC to QCOM on a three month and count the days backwards and forwards from the center of the middle W. QCOM could rocket with 25 days on one side and 23 on the other. What is 185 - 135? Ponder the contango. I know this is a gold site. If folks out in investor land ever make a few bucks in the paper how's about buying some real metal! Wild Wild Wed? You hoid it hea foist.

I'd be the last one on this planet to tell anyone to buy and hold equities. You'll get much better dividends by holding your woman than the tears of sorrow ye shall recieve for falling in love with your stocks. I've actually heard people say they are saving their stocks for their grandchildren. That is as absurd as trying to preserve lettuce. I said to them what if the companies go belly up long before they do away with creative wallpaper of worthless certificates.

JCTex
(03/10/2000; 23:40:45 MDT - Msg ID: 26665)
(No Subject)
http://www.hubbertpeak.com/campbell/commons.htmPicked this up from canuck at goldeagle. It is a presentation to the House of Commons about world oil running out. Scary, but interesting. Be interested in any feedback here.
Gandalf the White
(03/11/2000; 00:56:40 MDT - Msg ID: 26666)
BUT, Sir ORO !!
Sir ORO says:
"Trade and investment flows are near 0 net between the EU and the US when compared to the debt markets and should have little effect unless Europeans stop investing in the US, or the US goes even more overboard with imports of Italian leather and German auto and lab equipment."
+++++
Sir ORO, are you saying that EACH of the Hobbits should forgo the spring purchase of their five pairs of Saliavore Ferragamo's for this year of 2000 ? AND then too, not replace their "Beamers" ?
<;-)






View Yesterday's Discussion.

HI - HAT
(03/11/2000; 03:50:00 MDT - Msg ID: 26667)
Gold only Gold
All. Forgive the darkness of my posts. I must call it as I see it in my bones. I see WAR on a world scale. Many fronts from which it will escalate from. Conclusion drawn from inate synthesys of mass psychology. Historical crowd behavior. Trail Guides dollar timeline has been means to paper over most of the worlds divisions. This has been the new world order all along. Bread and cicuses for the world. At the end of this dollar timeline when ORO's "there is no spoon",dawns, the fall will break Alice's back and Wonderland will burn.
canamami
(03/11/2000; 06:16:20 MDT - Msg ID: 26668)
Various
1. Oro,

Thx for your reply (#26663). A very interesting point you are onto; again, you are a true polymath. The posters on this Forum are a veritable early-warning system of the upcoming crash and currency paradigm shift.

2. Stranger,

Thx for remembering one of the points I made in my old posts. Quaere whether and how the traditional symbiosis between the species of goldbugs may have been altered by the protracted (and I would submit artificially manipulated)
gold bear, and what the effect will be when the gold bull re-emerges?

3. SteveH,

Thx for your kind post at the stock site. I think the goldbugs' day will eventually come. Today, the Globe reports that margin rules have been tightened for dot.com stocks, as has certain types of aggressive trading re those stocks. (I think the paper meant short-selling). Also, Margaret Wente in the Globe has a piece about couriers, restauranteurs, etc. quiting their day days to day-trade, or actually retiring from their gains. She notes the huge amount of speculative debt created to play the market, and the insane valuations. She quotes from "Extraordinary Popular Delusions...". The mainstream press is acknowledging the lunacy; the end is near.

Hipplebeck
(03/11/2000; 06:38:20 MDT - Msg ID: 26669)
TO ELWOOD
Thank you for that correction on Jude.
Ulysses
(03/11/2000; 07:06:42 MDT - Msg ID: 26670)
Dollar Bill re msg#26661
http://www.usagold.comPlease don't refer to the Chinese people as "chinks". It's a racist,demeaning term and has no place in our esteemed forum of ladies and gentleman.
SteveH
(03/11/2000; 07:23:47 MDT - Msg ID: 26671)
Thanks JCTex
A letter to my friend Leroy:

Leroy,

A poster at www.usagold.com pointed out a URL: http://www.hubbertpeak.com/campbell/commons.htm. Here the reader will find testimony given by C.J. Campbell to the British House of Commons last year. The following is a summary of his findings:

-- for every one barrel of oil found, four are consumed.
-- 23 billion barrels are consumed annually.
-- Only 1 trillion barrels remain or are yet to be discovered.
-- Swing share in 1971 was in the mid-thirty percent range (Swing share is the oil provided by Middle East) and was the era of the mid-East oil crisis.
-- Swing share next year will surpass 1971 and will be 50% in 2008.
-- No new production will become available to reduce the swing share as the North Sea Oil did in 1971.
-- As the swing share rises now and into the future, expect the price of oil to rise dramatically.
-- Consumption is rising by 1.8% per year.
-- As the price of oil rises, consumption will reduce.
-- Natural gas and gas will account for 50% or so of the world's supply of fuel in 2050.
-- Official estimates are erroneous.
-- If US produced all the oil (except oil shale and gas), it would run out in under 4 years.
-- Oil prices will continue to excert pressure on the stockmarket.


Conclusion: The price of oil and gas will continue unabated until 2050 when the supply of oil and gas will run dry. As this happens, more and more of the world's oil supply will come from the Middle East (Swing share).

Solution: Develop consumption and production limits, develop alternative forms of energy and alternative forms of consumption of energy.

Action: Consume less energy. Buy oil stock and gold and gold stocks, because the ME wants gold and not dollars.

SteveH
Gold Trail Update
(03/11/2000; 08:26:08 MDT - Msg ID: 26672)
The Gold Trail Discussion has been Updated
The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
Harley Davidson
(03/11/2000; 09:01:59 MDT - Msg ID: 26673)
Gasoline:
Just gassed up the car today here in Raleigh, NC. Can't afford premium at $1.73 per gallon so I got the middle grade - 89 octane. $1.63 per gallon. The attendent said price would probably top out at $2.60. Also got some gas for the lawn mower. Total bill - $34.00. A friend in San Diego told me this week that premium costs him $2.10 per gallon. Looks like forecasts for $1.80 by summer peak driving time may be just slightly optimistic.
Leland
(03/11/2000; 10:11:17 MDT - Msg ID: 26674)
"Silver" is Buried Somewhere in Buffett's BH Annual Reports
Buffett, however, gave a very good summation:

Updated 4:34 AM ET March 11, 2000

Berkshire Hathaway chairman
Warren Buffett gave himself a
'D' for capital allocation last year
and blamed himself for the the
"inferior performance" of
Berkshire's equity portfolio. But
he noted "stumbles" by several
large "investees" -- companies in
which Berkshire has major
stakes.

"We still like these businesses and are content to have major
investments in them," he wrote. "But their stumbles damaged our
performance last year and it's no sure thing that they will quickly
regain their stride."

Among the core holdings in Berkshire's portfolio again last year:
American Express Co., 50.5 million shares; Coca-Cola Co.
(200 million shares); Freddie Mac (FRE), 59.5 million, down
from 60.2 million; Gillette Co. (G), 96 million; Washington Post
Co. (WPO), 1.7 million, and Wells Fargo (WFC), at 59.1
million.

Noting Berkshire's substantial holdings in the insurance industry,
Buffett said, "We do not expect our underwriting earnings to
improve in any dramatic way this year." It said the underwriting
performance of GEICO " is almost certain to weaken. That's
because auto insurers, as a group, will do worse in 2000, and
because we will materially increase our marketing expenditures."

Berkshire recently agreed to acquire MidAmerican Energy Co.
(MEC) and Buffett told shareholders that despite the industry's
"many regulatory constraints...it's possible that we will make
additional commitments in the field. If we do, the amounts
involved could be large."

Buffett also reiterated his trepidation about technology stocks, of
which Berkshire has held almost none; it did have a small stake in
Microsoft Corp. (MSFT) part of last year.

When the investor and his partner Charlie Munger can't identify
such attributes as important competitive advantages that endure
over time in a company, they won't buy its stock. "This explains .
. . why we don't own stocks of tech companies, even though we
share the general view that our society will be transformed by
their products and services," he wrote.

"Our problem -- which we can't solve by studying up -- is that
we have no insights into which participants in the tech field
possess a truly durable competitive advantage," Buffett wrote.
"Our lack of tech insights, we should add, does not distress us."

Buffett, known by many as "the Oracle of Omaha" (where he and
Berkshire are based, also joined the chorus of those predicting
an eventual decline in the stock market.

"Equity investors currently seem wildly optimistic in their
expectations about future returns," he wrote. Predicting growth in
corporate profits of no more than 5%, including 2% inflation,
Buffett said the valuation placed on American business is unlikely
to climb by much more than that," he said.

"If investor expectations become more realistic -- and they
almost certainly will -- the market adjustment is apt to be severe,
particularly in sectors in which speculation has been
concentrated," Buffett warned.

The investor indicated that Berkshire "will someday have
opportunities to deploy major amounts of cash in equity
markets." But, he added, "as the song goes, 'Who knows where
or when?' "

-Richard Gibson; Dow Jones Newswires; 515-282-6830;
dick.gibson@dowjones.com
4Ducat
(03/11/2000; 10:17:48 MDT - Msg ID: 26675)
Oil in transition
http://www.usagold.comHold on to your horses about "running out of oil". It is an economic impossibility! Because the price is allowed to increase to such a level that brings in other forms of energy. Specifically: Nuclear to hydrogen or geothermal to hydrogen. Also coal to electric to hydrogen. I believe the "hydrogen cell" will soon be developed. I'm no fan of nuclear anything I'm just saying it it being used at this time. Synfuels abound when the price is right. At $75 a barrel just imagine the oil companies scrambling to find cheaper substitutes. I used to really fear the depletion of large diameter trees for construction materials. In college we studied "glue laminates" for building wooden bridges. Never would I see the day that all the stuff was built and turned into a prosperous new product.....wood trusses instead of 2 X 12's. Amazing. Yes technology can solve the oil crisis. But, it has to turn into a crisis first. Have no fear the money is too dear. All those patents the oil companies bought to stop alternate forms of fuel suddenly become the R & D projects in the spotlights.
Al Fulchino
(03/11/2000; 10:44:14 MDT - Msg ID: 26676)
Harley and others
Life is all about choices. Today you made one about downgrading from super to the midgrade. In my view, for what oil/gasloine does, it is a bargain at anything UNDER $2.50 US. Why? Because, this little gallon of petro will push you and your 1500 to 6000 pounds of plastic, metal, and cargo anywhere from say 14 miles to as much as 50 plus. Of course, we all would rather pay 99 cts per gallon! Then we could buy other things or keep the money to look at. I mean absolutely no disrespect here. In fact, I think we have disrespected the oil /gasoline itself and what it does for us and how it has changed our world even moreso than any other development. In fact I think we even disrespect free market forces. We all complained when supplies were tight in the seventies. But it produced more exploration, did it not? ANYONE reading this little post would charge as much as they could if they had a product in demand. If you had the right beanie baby or the currently popular tulip. It is natural and it will in time produce an incentive for others to explore for new oil or alternatives. I am constantly amazed to see people get angry over the increase in gas prices. These people just do not understand supply and demand or a free market. Now I hear the voices. So many are saying how can this be free market if the OPECer's are cutting our supply? Simple, because THEY CAN. God Bless them for understanding that they have an important commodity and they need to make money while they can. Shame on anyone who does not see that. The OPECer's are in business. They owe us only from the standpoint that we have defended them versus Iraq and the former SU. They owe us as customers not to rape us. They also owe it to their countrymen to charge what they can reasonably expect, so as to maximize the value of their commodity. They also understand inflation. I laugh when so many complain about the US and others printing money, thereby lessening the value of a dollar, THEN go out to the local gas station and moan about gas prices. What do you think these prices should be? Don't you go ask you boss for cost of living raises from time to time? Is anyones cost of living the same as it was in the 70's ? Hell no. Why should oil be any different? I think the reason is that it simply takes money from other things we want. Thereby making it an intellectually disingenous argument to complain about oil costs and in the same breath complain about money supplies, inflation, and the need for a raise.

Enough said . Just had to say that. If you don't like higher oil prices all you have to do is take a deep breath and plan for the inevitable. Look around for nice little oil driller stocks. Look for nice little oil company stocks. Buy some gold. Then put them aside, drink whatever it is that you enjoy. And watch as your new partnership in the commodity protects you and yours.
Harley Davidson
(03/11/2000; 11:09:41 MDT - Msg ID: 26677)
Al Fulchino, your post (03/11/00; 10:44:14MDT - Msg ID:26676):
Thank you, sir, for your response. And, no I don't need a little cheese with that whine (smile). Perhaps you mistook my intent, or more likely, I may not have articulated it as well as I could have. Actually, I think we may both be "on the same page." To clarify further, my holdings of Fidelity Energy Services makes up a rather large percentage of my portfolio which I expect will continue to do well for the foreseeable future and more than compensate for the extra bucks spent at the pump. In fact, I wonder why OPEC took as long as they did to realize the true worth of their oil in terms of US dollars.

My point was to convey the experience of the reality of the oil situation today and most likely into the future as compared to the "official" forecasts i.e. disinformation, dishonesty, denial, etc., etc. of the current situation. Election year perhaps? Is it not unlike the "official" assessment of inflation today in general?

Thanks again...
Al Fulchino
(03/11/2000; 11:14:17 MDT - Msg ID: 26678)
Harley
First of all, I like your nick. One of these days I am gonna buy me one of those softails .
In regards to your post, I was using your comments as a platform to address complaints about prices. I agree we are on the same page. Muchos gracias for the reply.
Newsnugget
(03/11/2000; 11:32:26 MDT - Msg ID: 26679)
(No Subject)
http://www.freerepublic.com/forum/a365c772677c9.htmI've read several news articles recently, as crude oil prices have skyrocketed, that the Arab countries "owe" the U.S. for defending them during the gulf war.

I remembered seeing several news articles over the past years that Kuwait (and other Arab countries-namely Saudia Arabia?)paid large sums to finance most (or all) of the cost the gulf war. Large amounts were supposedly paid to the U.S. and other allies. I did a quick search and found the above link, dated 21 November 1998. I partially quoted from that site below, it details only Kuwait's payments toward the war effort:

"According to the documents, which have remained during all these years classified as confidential, the country that received the most money was the United States, which was remunerated $13.5 billion for 150,000 soldiers and supporting infrastructure. Other countries weren't left behind, such as the United Kingdom and Turkey which received for their help $1.4 billion each.The conflict in the Persian Gulf started on the 2nd August 1990 with the invasion of the Emirate of Kuwait by Iraq. After five months of preparations, the war began on the 17th of January 1991 and lasted officially 42 days, until the 28th of February, although the Iraqi troops were destroyed well before.

Participating in the allied army led by the United States, were Britain, France, Canada, Morocco, Egypt, Syria, Pakistan, and Bangladesh. Other countries, such as Spain, Belgium, Holland, Germany and Argentina, sent as well warships for the blockade of Iraq.

The $25,280,000,000 that the Kuwaiti authorities recognized to have paid for the operation were divided into three blocks: (1) direct compensation for military expenses to countries that participated in Operation Desert Storm, as the counter offensive against Iraq was named; (2) arms purchases; and (3) a part denominated "general and extraordinary expenses."

The list of payments sent by Kuwait to British courts is headed by the United States, which received $13.5 billion, consistent with its preponderate role in the allied army. Americans also received $500 million as an advance for the purchase of 40 F-18 war planes.

The United Kingdom, with which Kuwaiti authorities maintain historical relations due to its character as the old colonial power in the area and due to the fact that it is one of the privileged destinations for Kuwait's western investments, received $1.4 billion according to the documents. This was basically for the 9000 soldiers and infrastructure that Britain gave during the conflict.

Turkey also was compensated $1.4 billion for putting at the disposal of American planes the strategic air base of Incirlik, from where military positions in Iraq were bombed. Other big recipients were Egypt, with $970 million for its 20,000 soldiers, and France that received $250 million for artillery. Also on the list were old Zaire (now the Democratic Republic of Congo), which received $20 million for cooperation.

The third group of payments, referred to as "extraordinary and emergency expenses," is the vaguest of all and totaled $6,890,000,000. Although Kuwait has not specified the items, it is believed that they could include payments not recognized officially that were made to western countries and to armed forces of the region, such as that of Syria. Making the payments public could cause political problems, both in the recipient countries and in Kuwait.

In this category could also include payments to Canada for the 450 soldiers it sent, and the 6200 men sent by Morocco. It could also include the $100 million that the managers of Torras have assured was paid to Spain for sending warships and the use of bases in its territory. One could also deduce from this category how much money was received by Argentina, Germany and Holland for similar services."

Does anyone know of other payments, other than from Kuwait noted above? I seem to remember reading something a year or so ago that Saudia Arabia(?) had just make its last payment to the US for the war effort.

Thanks

NewsNugget

RossL
(03/11/2000; 11:33:27 MDT - Msg ID: 26680)
Ranting and Raving from "The Nation"
http://www.thenation.com/issue/000327/0327greider.shtml
Greenspan's interest rate hikes are the target of the left-wing folks over at The Nation.
Leland
(03/11/2000; 11:44:19 MDT - Msg ID: 26681)
Al Fulchino, your 10:44:14 is echoed in the LA TIMES (Grin)
Is there a positive side to the gasoline price hikes?
Phil Proctor, this column's man in Beverly Hills, heard an
L.A. motorist tell "CBS Evening News":
"I want to pay three or four dollars a gallon. I want to
feel like I'm living in Paris."
Ooh L.A. L.A.!
Dollar Bill
(03/11/2000; 11:49:42 MDT - Msg ID: 26682)
Ulysses
Hi Ulysses,
Nice name! "Yankee" means everything to some guys I know.
As in thier beloved NY Yanks.
Some south americans use "Yankees" in the same beloved way that Boston Red Sox fans do. "Damn Yankee's" comes courtesy of ticked off slave owners, and is now used by New Yorkers to describe thier own team on off days. "Oriental" sounds like a reasonable term except that it has some connection to the British in the empire days and some "Orientals" cringe at it. What is the history of the "chink" word?
Al Fulchino
(03/11/2000; 12:18:38 MDT - Msg ID: 26683)
Leland
Phil Proctor should have interviewed me. "Buy companies in the business and oil and gold! I wanna feel like an oil baron! Oooh lala!!!"
Leland
(03/11/2000; 12:47:40 MDT - Msg ID: 26684)
Al Fulchino
"Clink!"
Peter Asher
(03/11/2000; 13:11:50 MDT - Msg ID: 26685)
Swedes To Vote on Adopting Euro
http://news.excite.com/news/ap/000311/13/sweden-euro
One more bullet in the gun!
Mr Gresham
(03/11/2000; 13:33:51 MDT - Msg ID: 26686)
The Nation -- Left-wing economics -- Sympathy vs. Reality
http://www.thenation.com/issue/000327/0327greider.shtmlThanks, Ross L, for the Link.

Greider is the best of the bunch, and he targets the Fed as we do:

"monetary policy is the taboo subject of US politics, protected by mystification but also by its awesome power and political relationships. The Fed obfuscates and intimidates behind a mask of disinterested technocratic expertise, while powerful constituencies (banking and finance, the wealth-holders) police the boundaries of respectable thought. This is a very masculine institution (no bleeding hearts allowed), and the Chairman plays the role of wise, stern father who must occasionally punish the children for misbehavior. This odd governing arrangement, quite literally, infantilizes citizens and repudiates the ethos of self-government."

but what passes for Left criticism stops at the barrier of understanding ANY economic system well, let alone the one Greenspan is titular head of today. The Left sympathizes with human misery and the coming unemployment, but not a word about debt-hyped booms. These are good, apparently, because now "people of modest means are getting a taste". Not a word about the little guy being suckered in to take the fall. Not a word about needing $4 billion or so of debt to produce $1 billion or so of GDP growth, which goes mostly to the already rich and powerful, and is doomed to collapse. How can he even LEAN toward this?

When I took my first microeconomics course (1979) concerning money and markets, ten years after the macro (Keynesian) intro courses (1968) -- and after seven years of self-employment in construction -- I realized that the "human-centered" Left was just missing the mechanics of the society/world it lived in, let alone suggesting any useful improvements. It was a world essentially of Lawyers and academics, trying to legislate prosperity; not a businessman among them who'd ever had to meet a payroll.

I do believe that there is an potential affinity between the radical economics of the intended Left thinkers, and the Austrian/Libertarian schools. (They target the same "takers" who work the system from the top.) I just don't think anyone on the Left has done the necessary homework yet, and no sign of them starting (sigh), so my wishes are kind of irrelevant at this point. Some nice folks, but...

(This is why I hang out with you guys -- the best show in town. Also a "stage of life" issue: time to take care of self and family at age 50, not planning how to "rescue the world". Also finding out continually how much more EDUCATION I need. This forum delivers the goods!)

I wish Greider, who has written perhaps the best book on the Fed (still not complete without reading Griffin's "Jekyll Island" opus), would study Austrian economic theory, and apply it to the real issue of JUSTICE for the AVERAGE PERSON vs. The Powers That Be. That is what he purports to be about, but he is still stuck in the old "wisdoms". He would be a very effective advocate, but he'd have to start all over from scratch.?

Amazing world we live in isn't it -- we walk the same ground, pocket the same green stuff, but the parallel mental universes we inhabit can miss each other totally!

Are you listening, Bill?

Harley Davidson
(03/11/2000; 14:04:40 MDT - Msg ID: 26687)
Mr Gresham, in your (03/11/00; 13:33:51MDT - Msg ID:26686...
You referenced Griffin's "Jekyll Island". I read the book and found Griffin to continually drive home the point that banks "create money out of nothing - debt" and that fractional lending allows the bank down the street with $1 million dollars in reserves to make approximately $9 million dollars in loans. Can you or anyone else clarify this notion for me?

Thanks...
Mr Gresham
(03/11/2000; 15:39:45 MDT - Msg ID: 26688)
Jekyll Island
Harley --

Reading Griffin last May was the eye-opener for me. It seemed like I had really learned nothing of use in 30 years of economics study as long as the money-creation mechanism could be hidden from me for so long. I'm still not sure I've got it, really. Even people who WORK in banking don't get it; they just punch the keyboards and go home at night.

I also found flaws that did not allow me to take Griffin 100% at face value, so it took additional seeking of confirmation outside of his book, but it certainly seems to be on target. His repetition about it was good, because I think he well knew that he was trying to awaken a hypnotized audience. I certainly felt like that's what I was coming out of.

The fact that not 1 out of 100 of our neighbors understand the money mechanism either should allow us some patience with our own slowness to "get it."

The most accurate way to think of it that I see is that the banking system AS A WHOLE has the POTENTIAL to multiply money up to 9 or so times an actual initial deposit (reduced equivalently by withdrawals). What does that mean?

The borrower, say, of a business loan will not necessarily deposit it right back into an account at the same bank, and in any event will probably spend it soon so it will travel to other banks. Bank A's loans will travel to Banks B and C, but likewise their loans will travel to A.

The essence of fractional reserve money creation is that the money, whether an "original" deposit or credited to a loan account existing only in a computer ledger, remains within the system of banks and at no time leaves the banks' control in significant amounts to take a form other than abstractly-represented dollar-denominated accounts.

This is why the potential Y2k money-withdrawal panic was of enough concern to the Fed to cause them to print $200 billion of paper currency above the usual $50-something billion level. There can be an infinite amount of e-money; a somewhat lesser amount of paper money; and a very fixed amount of precious metals as money. The mere (or not-so-"mere") perception of a shortage could snowball into a bank run panic. Can't let that happen!

The POTENTIAL of the system to multiply money is that the demand for loans may not be up to the money-creation capacity of the system. Whatever the inducements, however low the rate (see Japan at 0-2%), people just may not have a desire or need to borrow, and so the multiplier effect may top out below 9x. This is why banks are always pushing, pushing, PUSHING money out at you from every billboard and neon shopping mall marquee!

Also, a slowing velocity of money circulation acts to reduce money supply, and at some point, there will be the second-order effect of a general perception that the economy is slowing, i.e., more loans may not be needed, loans will be paid back and not re-borrowed, some loans to marginal businesses may go bad, etc., caused by the shrinking money supply.

Money-creation multiplier can turn into a divisor as bad loans send thinly-created moolah to "Money Heaven." I think Oro has given us the best operating manual on this question, so read back over the past couple months (worth doing anyway -- I just download each month's posts into a big Word document.)

The next one I need to work on is the idea that follows in most fractional-reserve critiques about the idea of overall money creation being inadequate to meet eventual required interest payments, and thus bankers force everyone into "debt bondage" or default. I revisit that one about every six months, and it does operate more at the "macro" level than the other stuff, so I figure I don't really NEED to figure out if it's true anytime soon. But it does predict that the F-R system will implode every so often from its own sheer weight upon real people's real enterprises and survival.

The thing that more interests me is the idea of disintermediation, which (without consulting my glossary -- correct me anyone if my synapses have misfired and hit the wrong word) is how the banks and lending institutions have "borrowed short and lent long." All for a tiny spread that generates their current profits, backed by everyone's belief in FDIC insurance.

Not only is our society Math-challenged -- they are Time-Challenged! They just can't see the setup they've created for inevitable disaster. In the very very roughest terms: to live on a 2% spread, you have to be guaranteed to go 50 years without a fatal banking crisis not to have it all wiped out! (Of course, debts could be written down 30% or 50%, not necessarily 100%, but the idea still applies.)

(Another damn parenthetical aside: Is this why Manhattan Island at $26 compounded for 300-something years at 3% never got to the mathematically-dictated $26 gazillion dollars but only $2 or $3 trillion, because defaults would have to happen at historic intervals along the way, so the interest never REALLY happens like they say over generations?)

(Now, with Fractional Reserve in a boom time, that could be 2 or 3 or 4 two-percent margins working for you on hyped-up deposits, but those deposits are "hotter money" than ever and when they flee, you'll have the S&L Crisis times ten. The bank's capital goes down even easier, taking MORE of the depositors' money with it.)

That FDIC guarantee is flimsier than ever, but since "everyone's doing it" and with "OPM -- other people's money", well, you just have to go along just to be in the banking business, don't you? If it goes down, well then, we'll all just go sailing. What -- no sailboat? Then we'll just enjoy our horses. You didn't acquire a ranch with stables during the banking boom? (Really? Didn't everyone?) Well, then, maybe go fishing. What to do to continue eating? That's for the other 80% to worry about -- you won't be reading about them in the NY Times "Style" section anyway. [Ooops -- did I get going on a loopout, or what?]

I was just picturing a special spread on "homeless brokers/bankers living in cardboard boxes" in Wall Street back alleys. Not.

Sorry, I got carried away -- I think what has gotten me the past few weeks is how idiotic is most of what passes for public awareness of just about anything. It's so loud and insistent and self-important now, and two months later, say, after the market's crashed or some other chicken has come home to roost, everyone acts as if that was what they had "always known would happen." After the fact, everyone is 100% wise. They just couldn't be bothered the week before. However, you may notice them walking or driving around in a state of shock. (Stay off the roads on Crash Day!)

I hear clients telling me how they're putting stock purchases on credit cards; I just say "Hmmm-hmmm" now, not even the impulse to warn them -- that's how low I've fallen in this time! Just get through it; preserve mental health; it'll all be over when it's over as Yogi has taught us.

Back to work; stop me before I post again!




Harley Davidson
(03/11/2000; 16:19:40 MDT - Msg ID: 26689)
Mr Gresham, I'm starting to feel "world of high finance" challenged...
You said: "The thing that more interests me is the idea of disintermediation, which (without consulting my glossary -- correct me anyone if my synapses have misfired and hit the wrong word) is how the banks and lending institutions have "borrowed short and lent long." All for a tiny spread that generates their current profits, backed by everyone's belief in FDIC insurance."

Could it be that a bank can leverage their assets by borrowing a multiple of those assets from the Fed and then lend those dollars? Is this, in fact, fractional lending?
Elwood
(03/11/2000; 16:49:12 MDT - Msg ID: 26690)
To Mr Gresham (03/11/00; 15:39:45MDT - Msg ID:26688)
You said:
"The next one I need to work on is the idea that follows in most fractional-reserve critiques about the idea of overall money creation being inadequate to meet eventual required interest payments, and thus bankers force everyone into "debt bondage" or default. I revisit that one about every six months, and it does operate more at the "macro" level than the other stuff, so I figure I don't really NEED to figure out if it's true anytime soon. But it does predict that the F-R system will implode every so often from its own sheer weight upon real people's real enterprises and survival."

I reply:
To understand this become familiar with the Austrian notion of interest rates and how the central bank manipulates these rates during the boom. I believe the proponents of the Austrian school are unique in their treatment of exactly what constitutes interest.
Farfel
(03/11/2000; 16:49:32 MDT - Msg ID: 26691)
Larry Kudlow on GOLD and stuff: Slimey, slimey, slimey...
For those who had the misfortune of reading the winner of the "Marty Armstrong Full of Crap Award, year 2000," then take a look at the OP-ED column in Friday's New York Times.

Larry "Owned by Wall Street" Kudlow wrote an article attacking Mr. Greedspoon for raising interest rates given that the American economy is doing fine, growing with almost no inflation. He warned Greedspoon, "If it ain't broke, don't fix it."

Of course, in his mind, the savior for the American economy is technological progress and he says "technology has fought inflation much more successfully than the Fed ever could."

Most importantly, he assures us that if money supply were excessive then the dollar's exchange rate would decline (unless of course, Wall Street's currency traders have established enough foreign currency carry trades to ensure a steady assault on the value of most major foreign currencies...or that the US government's creation of a bubble stock market assures foreign funds will continue to flow into American capital markets to participate in "the party," thereby ensuring a stronger than normal US Dollar...or that the US government's ability to convince friendly government's to sell most of their gold reserves ensures their almost ZERO-hard-asset-backed currencies will remain weak against the US Dollar).

Further Larry assures us that, in this "new Internet economy" of ours, if money supply were excessive then gold would be strong but in fact it is weak (Of course, that is a classic example of a New Paradigm disciple wanting to have his cake and eat it too. One day, we are told gold is irrelevant to the New Economy, having been consigned to the status of a mere commodity...then when it suits their purposes, the Larry Kudlows of the world trot out the low gold price as proof of little to no inflation. So which is it...financial reserve or mere commodity? Meanwhile, the CRB index representing almost every other portable hard asset in the world, has been going through the roof this past year).

Finally, Larry Kudlow assures us that if money supply were excessive, then long term interest rates would be rising but lo and behold, they are falling! (Of course, the short term interest rates have been going through the roof and long term rates were also shooting skyward UNTIL the Treasury announced a sudden intervention into the long term market, declaring a buyback of Treasuries using funds from the budget surplus. Forget the fact that the budget surplus itself appears to be entirely specious, instead representing borrowings from the government's social security fund that must be paid back someday. So it is very much a Ponzi scheme, a case of borrowing from Peter to pay Paul, in this case borrowing from the Social Security fund to pay off long term treasury holders).

All I can say is that the lies of America's stock market bulls grow and more and more egregious and insufferable with each passing day simply because they are devoid of one scintilla of logic (Of course, we are in a New Era and all paradigms of old logic are no longer relevant. In other words, 2 plus 2 does not equal 4, the sun no longer sets in the West, blow jobs are not sex, is does not mean is, etc., etc., ad nauseum.

Yes, Americans are dead asleep at the wheel, fat and happy, gorged on an abundant feast of nonsense, all too happy to allow their economic masters to engage in any subterfuge or sophistry to ensure their SUV-in-every-garage lifestyle is not altered.

What a rude awakening awaits!

Thanks

F*
Mr Gresham
(03/11/2000; 17:38:17 MDT - Msg ID: 26692)
New brevity policy
Harley --

"borrowing a multiple of those assets from the Fed and then lend those dollars? "

Nope -- They make it up as they go along, just like us. (Call it "Fractional Reserve Writing"? -- "I've got a piece of an idea here; I'll just write until it all comes out" (?))

They create the money. It goes into bank deposits, somewhere. They just have to hope that (1) enough people leave enough of that funny money on deposit everywhere to cover the system, and (2) enough people leave enough on deposit at THEIR bank to cover the loans out. If either (1) or (2) is at risk, they count on the Fed to "repo" them with cash on their less liquid loans to cover it.

Help me, team. Better way to say it? Fun on a Saturday afternoon.
Hipplebeck
(03/11/2000; 17:49:05 MDT - Msg ID: 26693)
TO FARFEL
Thank you, that was great!
Harley Davidson
(03/11/2000; 17:49:21 MDT - Msg ID: 26694)
Thanks Mr. G...
I think a re-read of selected sections of Griffin's book is in order.
gidsek
(03/11/2000; 19:38:23 MDT - Msg ID: 26695)
Hi Hat
http://www.chaostan.comread your 3:50, you might find Rick Mayburys' site interesting, investment and geopolitics etc.

gidsek
Cavan Man
(03/11/2000; 20:16:36 MDT - Msg ID: 26696)
Farfel 26691
I nominate this for the HOF.
Cavan Man
(03/11/2000; 20:38:48 MDT - Msg ID: 26697)
Trail Guide/Aristotle
TG: I have read and re-read what you have written this past year many times. The serial along the "Trail" is teriffic. I believe I know now what you mean when you say, one should hold as much gold as, "one can grasp". The grasping is not only a tactile sensation. By grasp, you mean intellectually "grasp".

Aristotle: Sooner or later, you are right.

Good evening all....CM
Dollar Bill
(03/11/2000; 20:45:05 MDT - Msg ID: 26698)
Farfel
You were right about the guy you quoted. Here is another view of the state of affairs.
"Todaymoney is created with dangerous ease. With commercial paper and other money market financing vehicles operating ourside of reserve and capital requirements, the "infinite multiplication"of money is at work. The federal reserve has completely lost control and the ever-opportunistic wall street has grabbed the reins. Truly unprecedented quantities of money and credit are being created.

Economic textbooks taught the "money multiplier effect" whereby a bank recieves a deposit and a portion of this is held back for reserve. Funds remaining after the reserve hold-back were then lent, hence creating additional money supply. This was the "Multiplication of bank deposits".
The old textbook example, however, will need to be rewritten to be applicable to the comtemporary financial system. You see, commercial paper is the major source of funding for the enormous growth in the US financial sector.Conveniently unrestrained by reserve and capital requirements, the financial sector has engaged in unfettered money and credit creation with an "infinite multiplier effect". A complete breakdown of the key relationship between savings and borrowings." Excerpts of this weeks Doug Nolan commentary
stevievh
(03/11/2000; 20:53:20 MDT - Msg ID: 26699)
Philippine Gold and Mining
Hello; I'm a new kid on the block. Anyway, anybody interested in Philippine gold mining? There is a town here
called Paracale, where the cottage industry is digging up
your backyard for the metal, by the way a claimant says
that Placer Dome wants to get in one of the big mining company operating the area. According to sources, this area
has the best deposits in the Philippines. The listed mining
company is resisting all efforts-for selfish motives-two things though, invest in a claim or maybe the stock market.I
did a check on the market, last month the share of this company jumped l58% in a day with all the brouhaha going on
here. A small claimant says that the mining company seems to
have hit the Mother vein, by the way, this person is a former Director of our bureau of mines. So anybody interested?
law
(03/11/2000; 20:53:31 MDT - Msg ID: 26700)
FOA "A Fireside Talk (further continued)"
(03/11/00); 08:26:08MDT - Msg ID:12In your much appreciated "Fireside Talk (further continued)"
I'd like to point out what I believe was probably just an oversight in your proofreading? In your 4th paragraph you state..."But after 1976 they found themselves selling a resource for far MORE (I believe you meant LESS) than they realized it would bring and doing so in dollars of unknown future value." I choose to point this out...not as a technicality because of my familiarity, but for someone reading this with less of an understanding of the context in which this occurred and which you have written, in order to avoid any semblance of confusion.

If this be the case, maybe MK or Jeff can correct this in the Trail section?

TG: You have helped put many parts of a 20 year puzzle together...please, do continue!
TheStranger
(03/11/2000; 21:03:13 MDT - Msg ID: 26701)
Thoughts for Canamami, Solomon and the Gang
http://www.the-privateer.com/g-charts.htmlCanamami:
Quaere whether and how the traditional symbiosis between the
species of goldbugs may have been altered by the protracted (and I would submit artificially manipulated)
gold bear, and what the effect will be when the gold bull re-emerges?

Stranger:
Canamami, I don't know what on earth makes you think I would know what "quaere" means, but I'll comment just the same. In 23 years of managing money I have noticed that failure in the markets has two principal symptoms. First, the investor hits the books and gets to know his investments much better than he ever intended to. Second, the investor gets and stays cranky for extended periods of time. I guess that pretty much describes a few of the hangers-on here at USAGOLD. If not, it certainly describes me.
Your choice of the verb "re-emerges" (above) is much better than the word I recently used ("continues") to describe what I consider to be a a gold bull market. Whatever it is, it certainly appears to be on hiatus at the moment. Last week was a real clunker! The only way I know to account for it is that Switzerland is perhaps getting ready to start selling this month (and this hard upon the heels of the BoE's announced intention to extend the madness of their actions). I note also that Canada managed to find a few more ounces to unload recently. Shortly before the announcement, you had wondered aloud in the Forum if in fact some country or other wasn't doing just that. Good show, Your Honor!

All - Next thursday and friday, the U.S will give us another fix on the PPI and the CPI. From what I hear, the figures are bound to be higher this time. We'll see.

I am very pleased by all the sudden talk of margins being squeezed in the corporate world. This nonsense about how companies can't pass along the higher costs to their customers is precisely that, nonsense. In the months to come, I believe there will be no choice but to pass these costs along. And why not? The consumer is flush with stock market gains and enjoys an almost unprecedented degree of job security. So much lousy economics gets spouted these days. To understand the reason for some of it, I think one needs only compare the breadth and depth of the world's bond markets to the amount of trading which takes place in PMs. Let's face it, disinflation's constituancy is far greater than bullion's. But, I ask you, how is that going to change the basic laws of economics? Excess fiat money creation will always beget higher prices, first at the commodity level, then throughout an economy. In this regard, the events we see unfolding today were perfectly predictable (I know because I predicted them). In the end, it isn't the supply of oil or technology or gold or anything else which will dictate the value of the dollar. It's the supply of the dollars themselves.
If anybody is feeling a little low tonight, I suggest taking another look at the Privateer's gold charts. I just did, and they bucked me up considerably. They are at the link cited above. Also check out this week's Barron's wherein Larry Jeddolah (head of the highly regarded TIS Investment Group in Minneapolis) reveals, in an interview, his strong predilection for gold in the current environment.

Sol - Was it you who asked more thoughtful questions of me regarding Barrick? If so, please forgive me for not responding. Your questions may not have been intended as rhetorical, but they work as such nonetheless. I just don't have the desire to carry the torch any further on that subject and feel my points were sufficiently made. So were yours, by the way, and I thank you for that.

One last thought: Kudos to John Crudele at the New York Post and the guy who did a little extra digging to find where the Labor Department confessed to massaging, not only higher oil, but the RIPPLE EFFECTS of higher oil out of the January CPI numbers. What a racket!
stevievh
(03/11/2000; 21:28:51 MDT - Msg ID: 26702)
Making Money
Investors, Speculators, Anybody. I guess no one answered or
got anyone interested with what I posted. Consider this,
AA a listed issue rose in 3 months 300 times due to a rumor
that the no. group of companies here in the Philippines was
coming in the back door. Up to now, it is still a rumor.
Another issue Zipporah rose from 6 cents to 28.00 because of
a takeover of a high profile and excellent businessman; another issue multiplied 50 times in a year due to questionable trades but it remains to be proven. If you remember Bre-X, it was a hoax maybe of the Century, but still prices of stocks rose. The issue UPM has proven substantial ore deposits, the best in the Philippines,it is
a fact that other International mining company's want to get
in, but is resisted by the major stockholders. Everybody is
digging their backyard in the area, just to prove how rich
in deposit the ground is. But you know, nobody notices UPM, this issue will save Phil. stocks but like they say, a prophet is not recognized in his own town.
Gandalf the White
(03/11/2000; 21:43:06 MDT - Msg ID: 26703)
Hello stevievh
I believe that you may have made an incorrect turn at the Kitco.com board and somehow arrived here at the USAGOLD Forum where no one cares about such matters as those that you are "hawking".
<;-)
Leland
(03/11/2000; 21:45:29 MDT - Msg ID: 26704)
Thanks, Stevievh
Stevievh,
Using common sense, you are probably referring to
Philex Gold.
This forum is not intended for promoting individual
companies.
If you will go off line, and write me, I'll direct
you. Your excitement is appreciated.

leland@netarrant.net
pdeep
(03/11/2000; 21:46:54 MDT - Msg ID: 26705)
Dollars, Bonds and Oil
Following up on Farfel's post, I was also wondering how the dollar was supported in the forex markets. As a non-economist, here's my take, which may be completely off the mark.

A lot of dollars have been sucked into and locked into Treasury debt owned by non-Americans. This paper has dropped anywhere from 10% to 25% in value over the past couple of years, as interest rates have nudged up. Meanwhile, dollar for oil payments must go on, at ever increasing amounts of dollars for oil. So if I went to a European bank to change my DMs into dollars for oil payments, the nice banker would have two choices: either they buy dollars on the forex markets, or they cash in their US paper. Now if they be holding that paper at a loss, it would make sense, up to a point, to go into the forex markets and bid for dollars. The cross-currency price would have to rise by quite a bit before I was induced to sell off my paper at a loss. So I think part of the dollar's "strength" ironically is based on dollar debt weakness.

This might explain why the dollar seems to be managed, especially by the Japanese, to trade within a particular range. Not too high, as it would induce selling of the paper at a loss, and further losses as interest rates rose, and not too low which would tend to eat into export volumes. Don't know, just wondering.....

Gandalf the White
(03/11/2000; 21:56:18 MDT - Msg ID: 26706)
more mixed truth and fiction
High Oil Prices May Hurt US Economy

By JOHN NOLAN, Associated Press Writer
CINCINNATI (AP) - Rising oil prices may have left their mark at the gas pump and on airline ticket prices, but their climb has yet to ripple through the U.S. economy.

However, analysts say, if oil prices stay high for months, the impact could grow as consumers pay more for basic goods.

"The money spent filling up at the gas tank is money you can't spend at the mall," said David Wyss, chief economist for Standard & Poor's DRI in Lexington, Mass. "We'll start to see that later this year. It takes people a little while to adjust their habits."

Word this week from Procter & Gamble Co. that its profits are suffering due partly to increased prices of raw materials is a good gauge that the rise's impact is widening.

The maker of well-known consumer brands such as Crest toothpaste, Pampers diapers and Tide detergent said Tuesday it will earn less than expected in the next quarter - in part because prices are rising for the petroleum-based materials it needs for manufacturing.

Wall Street punished the company harshly, causing its stock to fall from $87.43 3/4 on Monday to $53.37 1/2 late Friday.

Other consumer products companies such as Colgate-Palmolive Co. and Kimberly-Clark Corp. also saw their stocks suffer, although those firms took pains to tell investors their profit picture hasn't changed.

These companies use petrochemical-based products a number of ways, from their plastic bottles to their detergents. They must also pay higher prices for fuel for the trucks that deliver their goods.

Despite high gas prices, the auto industry has yet to suffer. Sales of light trucks increased by more than 10 percent from January to February, for instance. Still, there are some signs of trouble.

Higher fuel costs for transporting products prompted Ford Motor Co. on Monday to raise delivery charges for vehicles by $25. General Motors Corp. is considering raising its destination charge for shipment of products.

Shipper FedEx Corp. said last week it would increase the 3 percent surcharge it began last month to 4 percent.

And on Friday, Continental Airlines attempted to impose a new fare increase of up to $40 per round trip, blaming the rising cost of fuel. The airline led the industry in a $20 boost in January, but had to back off on a second increase of $30 two weeks ago after other airlines wouldn't follow.

So far, economists say, oil prices haven't spurred significantly higher overall inflation because the country is now less oil-dependent. <====== NOTE this one! <;-)

In 1981, the U.S. oil bill was about 6.5 percent of the gross domestic product. Today, it is about 2 percent.

That's partly because of conservation and also because inflation-adjusted oil prices have increased slower than other consumer prices.

Meanwhile, P&G's chairman Durk Jager spent the better part of the week reassuring major investors that the company will keep on its long-term program of increasing sales and getting new products to market faster.

"The stock will ultimately come back. We hope it will be pretty quickly, to restore investors' confidence," Jager said Thursday.

And demand won't slacken, said company spokeswoman Linda Ulrey.

"People are still going to need diapers and toothpaste and toilet paper," she said.
===
<;-)
PS: The Hobbits are stocking up on those old telephone books and being sure to get a few boxes of the large size Arm & Hammer bakingsoda to satify Mx. Ulrey's needs. AND
in answer to the quote -- "So far, economists say, oil prices haven't spurred significantly higher overall inflation because the country is now less oil-dependent." The Hobbits want to know if these "economists" have been to the stores or bought fuel recently ?
PPS: Howdy there Stranger ! Seen that horseman with the BIG RED "EYE" getting closer to Denver?

Harley Davidson
(03/11/2000; 22:38:07 MDT - Msg ID: 26707)
Anyone...
As I read the Gold Trail (thank you TG for taking your time to patiently share such knowledge), I come away with an observation. It seems to me that much that has transpired in the last twenty years has simply postponed the inevitable shift of an enduring form of wealth - gold, to those that possess a temporal form of wealth - oil. The oil is consumed but the gold is not. Looks like a one way street.

If this is correct, then what is the logical conclusion(s) one could reach?
HI - HAT
(03/12/2000; 04:23:25 MDT - Msg ID: 26708)
Alpha Strategy
In the late 1970's John Pugsley came out with a book called " The Alpha Strategy". In this time frame we were of course in the malaise period which led into the Reagens restoration of the American "dream". Pugsley put forth the proposition that one should buy all kinds of physical commodities and take delivery to hedge against inflation. That this kind of beanie baby panic out of fiat was taking shape in the masses led the High Priests to pull out all stops and bring forth Darth Vador Volcher to do battle against the forces grasping for a way to preserve wealth. So here we are today in the restored full blown wireless new age. Much has been put forth concerning who, what, where and why's of anti-gold propaganda. No need to go into all that here. What does need to be looked at, and this is an ultra classic Sherlock Holmes dog barking thing, is that it is never ever touched on in financial media on who out there are that stupid to trade in their green frog skins for the worthless relic. Brothers and Sisters we are that stupid. We employ the ultimate alpha strategy. 1 OZ. in our palm represents 150 bu. corn, or 10 brls. oil, or 60 bu. soybeans, or 300 lbs. copper, or 300 lbs. coffee. As you can see we are all quite stupid as to think we are able to hold all this in the palm of our hand.View Yesterday's Discussion.

SteveH
(03/12/2000; 06:21:35 MDT - Msg ID: 26709)
Protecting the right to protect gold (at school)
The following is a letter to supporters regarding an incident in a Holland, Michigan school. The parent's child was asked an opinion in the classroom. The answer involved a sound understanding of the Second Amendment and also how the school would be safer if some teachers were allowed to carry guns. The teachers banded together to put the child on a "watch list." It was their opinion that the child had too deep of an opinion regarding Constitutional matters. The parents met with the school and told them not to put their child on this "list." They also told the school that they were seeking legal counsel. I thought the Dad's response below was worthy of a repost.

SteveH

Frank and all,

We are in a unique position here - we can either escalate this into an
all out war with media involvement, or just withdraw to the "38th
parallel" and remain watchful. The bottom line is that Shelly and I
both believe that these people involved are somewhat insecure and
may let their egos turn against Derek. Derek is convinced that he will
stay in XXX School and will not back down from stating his
opinions. We were assured in our meeting Friday that the school does
not prohibit free speech, but yet Derek was placed on the "list". We
were assured that this incident will not affect the relationship between
Derek and his teachers - but I think we all know it has. Each of these
people on the "team" probably had no issue with Derek, but by virtue
of assembling together and talking they were able to feed upon each
others concerns, no matter how small, and allowed them to grow. And
I am convinced that Derek will now be placed under a microscope for
observation more than ever.
The people involved in this meeting did apologize and admitted that the
policy and procedure has short comings. I did record the meeting, and
I also told them that because of the seriousness of this situation I had
asked for counsel from various groups I am associated with. Maybe
this had an effect on how the meeting was conducted. There was no
shouting or anger, and everyone was very polite and they did listen to
us for which I am thankful.
But we do have unresolved issues to deal with. One issue in particular
bothers my wife and me. The people in this meeting felt that it was not
normal for a 12 year old boy to be knowledgeable and speak so very
strongly about Constitutional issues - and particularly the Second
Amendment to the Constitution. We are also troubled that the principal,
Mr. XXX is so adamant about never defending yourself when
attacked. I agree that it is always best to walk or even run form a fight.
However there are times when you cannot avoid defending yourself.
And my question is this - where was the "team" when my son was the
victim of an unprovoked attack at the beginning of the school year on
the school property?
But now we have a greater problem at hand. My son feels betrayed.
The people he looked up to and respected as role models, teachers,
and friends went behind our backs and labeled him. They put him on
the "list". His friends will probably find out about this as will their parents.

Derek's close friends will always stand with him. But how will this affect
those who are not as close and don't know us as well? Will Derek suffer
alienation as a result? Will he be excluded from invitations to parties and
get togethers [sic] - because after all, those people at the school are professional
and if they think there is a problem with Derek they must be right. Will any
of the people involved in this "team" actually ever look at my son without
some element of suspicion in the back of their mind? I must admit that Shelly
has been in tears over this - and my heart is also broken. Because of what
has happened, no matter how well intentioned, my son has lost his innocence.
And there is no way that we can ever go back and change what has happened.
My hope is that Derek will be made stronger as a result of what has happened.
I hope that those individuals will look inside themselves and realize that by
only
thinking about the consequences of this incident and realizing that because of
the political atmosphere this country has allowed itself to degenerate to, that
we are now faced with an entirely new tragedy. And that tragedy is the labeling
of our children because we choose to be hunters and gun owners. And the people
I know in this group are by far the most responsible and caring individuals who
make this nation by far the greatest on the face of this Earth.

I do not object to letters being sent to the school. I would hope that everyone
can
see that for now we have handled the situation. Please be very polite and
remember
that if by chance this situation does get more media attention, the impact of
what and
how we say it will be watched by many groups both for and against us. Let's try
to
make the best of this situation for our cause but most importantly remember that
my
son Derek wants to stay at this school - and he intends to try to educate
everyone
to the best of his ability that we are not to be labeled and watched. We are
just
average Americans who believe in the Constitution - the Supreme Law of the Land
-
average Americans who now find ourselves being the victims of ignorance. And we
all have to do everything we can to take a stand and let the whole world know
that
enough is enough! No longer will we tolerate this hatred that is being directed
against
us. We are tired of being cast as second class citizens just because we believe
in the
Constitution, particularly the Second Amendment. This Constitution did not give
any
of us the right to keep and bear arms - that right comes from God if you will -
what
the Constitution does is guarantee that this right will not not be infringed.
And this
right must not be allowed to be infringed, not by Congress, not by the
President,
and most certainly not by those who do not truly believe in the right to free
speech.

Thanks again to all.


Mr Gresham
(03/12/2000; 06:52:58 MDT - Msg ID: 26710)
Trail Guide or anyone
http://www.amazon.com/exec/obidos/ASIN/0684801825/o/qid=952864782/sr=8-1/002-1524644-1117818As I read FOA's installments on the Trails page, I am thinking about parallel reading that needs to be done outside of this forum. The only book I have found/read on International (Central) Banking and monetary crises/strategies of the "Big Boys" has been Steven Solomon's (former Forbes writer) "The Confidence Game: How Unelected Central Bankers Are Governing the Changed Global Economy" (June 1995). His interview list is stupendous -- from Volcker on to about 200 others including most of the Central Bank heads in the 70s and 80s.

But I read it last May -- before I encountered USAGold, Another, FOA. I'm going to library or buy it for a re-read, to try to fit our pieces together. I don't remember things like Smithsonian and Jamaica Accords mentioned in, but then I wouldn't have been looking for them there. I do remember Plaza and Louvre being in there.

BUT: Amazon book search on topics of central banking, international finance, etc. shows NOTHING besides that book.

Where else to find out the consummate insiders' (central bankers) real views on gold? Anything you know of on the formation of the Euro? On the thinking of those who formulated these plans? Articles in the Economist? Mundell? I'm just imagining that none of these guys would have said their true thinking out loud in those times, or even now. Gotta keep Poppa Dollar placated until the moves are made.

Anything on oil? In Daniel Yergin's "The Prize"? (Still haven't read.) Did Yamani write a book? Anything on OPEC. Did some Norwegian retired oil minister write his "expose"? Or are we only going to find a few oblique passages somewhere without much fleshing out.

Anything on the rise of the paper gold market, as a substitute (placebo) for buying physical? LBMA's purpose, and effects? How could this fool ME oil exporters for so long? Or do traders just trade -- and not write books?

Was it planned in advance? Or just stumbled into? (Some pretty lucky stumbling? Or maybe the Saudis and Europeans really WERE dollar-dependent as a mechanism for doing everyday business. Maybe certain key individuals were "spoken to" or "reached out to"?) Maybe the 10- or 20- year "timeline" or planning horizon is customary for them, while seeming like a lifetime to us?

I guess what I'm trying to arrive at: Is FOA/Another's story the first and only exposition of this picture we've had and are going to get? I certainly never read it anywhere else that I can remember, but have pieces appeared anywhere else? Is it just that good a mystery: How the US held its fiat reserve hegemony together after the shaky 70s and through the 90s keeping oil and gold so low for so long and no one knew? Or did the Big Players who would have known just figure they could pile in at the last minute (now?) ?

(My candidates for the Big Events I knew of at the time: Volcker playing chicken with a collapse to wring out inflation -- creating a T-bond bull market --, and the Gulf War flexing military muscle in OPEC's front yard. Third, maybe, Japan's retreat from economic "wunderkind".)

Was the fix in throughout the 90s and the GS-type biggies knew to stay away (until when?). If quasi-public money was gonna lean on gold, you wait till the bottom then quietly scoop up private holdings with both hands while the public mechanisms hold it back just a little longer? The problem with such scenarios is we little guys never gonna hear it.

It's the essence of power to transact in secrecy. FOA is the closest we're gonna get to an insider's views, and his speech shows that long long view from deep behind the public mask. It's just that none of us can judge that level -- me, I've seen a few movies, maybe, and read a few novels. I don't think even Oliver Stone could do this one justice.

Enough questions for now. Fellow hikers?


HI - HAT
(03/12/2000; 06:53:11 MDT - Msg ID: 26711)
gidsek
Thanks for the link. Pray for a miracle.
Henri
(03/12/2000; 07:06:53 MDT - Msg ID: 26712)
Leland Post 26684
"Clink!?" Is THAT what you call someone who makes continuing deposits of hard metal into their piggybank while the rest of the fiat world deteriorates around them.
I like it! I'm a "clink".
Henri
(03/12/2000; 07:24:22 MDT - Msg ID: 26713)
Thank you Trail guide for another great installment
Off to Meeting now.
Leland
(03/12/2000; 07:36:23 MDT - Msg ID: 26714)
Henri
Aye, tis a beautifulll sound!
HI - HAT
(03/12/2000; 07:59:03 MDT - Msg ID: 26715)
Mr Gresham TRUTH
I am still waiting for an elucidation of the whole gold,cival war central bank, greenback, Abe Lincoln, thingy. We might be waiting around awhile for the revealations of the real machinations of this ongoing fiasco. I'll tell you one thing though, if the crb index really starts to take off across the board I'm going to try and glean who is demanding and deliverey destinations. This could be a red flag for war preparations and the current romp in the strategic metals platinum and paladium has got my attention.
Leland
(03/12/2000; 08:45:43 MDT - Msg ID: 26716)
Two New Words -- "Bezosified" and "Qualcommed"
Charles Ponzi wasn't the first to try it, but he has joined Dr. Bowdler
and Captain Boycott among those whose names will forever be
terms of abuse. And the classic scam that bears his name -- using money
from new investors to pay off old investors, creating the illusion of a
successful business -- shows no sign of losing its effectiveness.

Robert Shiller's terrific new book, "Irrational Exuberance," contains a
brief primer on how to concoct a Ponzi scheme. The first step is to come
up with a plausible-sounding but complicated profit opportunity, one that
is difficult to evaluate. Ponzi's purported business involved international
postage reply coupons. In a more recent example, Albanian scammers
convinced investors that they had a profitable money-laundering business.

From that point on it's all a matter of timing and publicity. An initial group
of investors must be pulled in, large enough to attract attention but not
too large; then a larger second group, whose investments can be used to
pay off the first, a still larger third group, and so on. If all goes well,
stories about how much early investors have made will spread, attracting
ever more people, and the continuing success of the company will silence
or drown out the skeptics.

In the United States, regulators -- who know very well just how effective
such scams often are -- do their best to stop them before they get
started. So you might think that Ponzi schemes are mainly a historical
curiosity. But Mr. Shiller is not interested in history for its own sake; he
uses Ponzi schemes as a model for something much more important.

Imagine, just hypothetically, that a new set of technologies --
technologies that are really, truly, deeply fabulous -- has just emerged.
And suppose also that a number of companies have been created to
exploit these new technologies, in the entirely honest -- but very hard to
assess -- belief that they will eventually be able to earn huge profits. For
the time being they earn little if any money; even if they make an
accounting profit, they must continually raise more cash to pay for
equipment, acquisitions and so on. Still, as the evidence for a true
technological revolution mounts, the prices of their stocks keep rising,
producing huge capital gains for early investors. And this attracts ever
more investors, pushing the prices still higher.

If the process goes on long enough -- and there is no reason it cannot go
on for years -- the doubters will start to look like fools, and the bears will
go into hibernation. Everyone (well, almost everyone) may be completely
sincere; nonetheless, in effect you get a Ponzi scheme without a Ponzi, a
scam with no scammer.

Given the title of Mr. Shiller's book, you can guess the punch line. He
makes a powerful case that the soaring stock market of recent years is a
huge, accidental Ponzi scheme in progress, one that will come to a very
bad end. The book actually focuses on the market broadly defined (most
numbers are for the S.&P. 500), but it reads even better as a tale of the
tech stocks. It's a book that I hope many people will read; but I doubt
that many will be persuaded.

You see, right now bears have an extra credibility problem. Not long ago
many people were skeptical not only about the prospects for today's
technology companies but about the importance of the technology itself.
(I plead guilty.) And every new statistic showing soaring productivity and
earnings growth shows how wrong they were. As a matter of logic you
can concede the reality of a technological revolution, even while asserting
that the valuations of many technology companies are crazy; but who will
listen?

It's also true that savvy investors (at least they seem savvy) are following
the Levi Strauss strategy: Let others get caught up in the gold rush, we'll
sell them the supplies. It is quite possible that the valuations of companies
that sell Internet infrastructure make sense even if those of the dot-coms
do not.

Still, as you watch those who missed out on the first few thousand points
of the Nasdaq's rise feverishly try to make up for lost time, you have to
wonder. Will people 80 years from now talk, without quite knowing
where the term comes from, about being bezosified or qualcommed?

[Fair Use for Educational/Research Purposes Only and Thanks
to the NY TIMES]
Dollar Bill
(03/12/2000; 08:55:56 MDT - Msg ID: 26717)
Stevevh
Hello Stevevh,
Welcome to the forum, I read and many others read the posts here and yours as well. I know for me, I am a student on a lot of the subjects. I dont have an answer to what you said but I am interested in what you have to mention. No response does not mean lack of interest.
Jason Happy
(03/12/2000; 09:55:16 MDT - Msg ID: 26718)
Warren Buffett's Silver
http://news.excite.com/news/dj/000311/20000311-000167Quoting the last paragraph of the Excite article:

" Berkshire's annual report also showed that Walt Disney Co. (DIS) no longer is a core holding in its portfolio. Disney was not among the year-end equity stakes exceeding $750 million. At the end of 1998 Berkshire's Disney stake was valued at $1.5 billion, and was on the core-holdings list. The report doesn't disclose whether or not Buffett sold his entire Disney stake. "

Since the 1999 Annual Report does not mention silver anywhere that I can find... who at this Round Table sees the significance of this statement (which also says zero about silver) with regards to Warren Buffett's Silver holdings, reportedly 130 million ounces?

Harley Davidson
(03/12/2000; 10:02:40 MDT - Msg ID: 26719)
Good morning all...
I read an interesting article, which actually I was quite surprised to see, in my Sunday newspaper this morning that I thought worth sharing. It was a headline inside the first section of the Raleigh News&Observer "Can we take it to the bank?" and I quote:

"When President Clinton unveiled his eighth and final budget, he stood in front of a large banner proclaiming, "America: Debt Free by 2013." Then, to underscore the point, he took a big blue pencil and drawing a thick line from today's debt levels straight down to zero over the next dozen years.

"In a new era of budget surpluses, Clinton views this trend as one of his crowning legacies - making America debt-free for the first time since 1835 when Andrew Jackson was in the White House. On Capitol Hill, congressional Republicans have picked up the chorus with their own forecasts of a zero-debt future by 2015.

"There's just one problem: All this euphoric new doesn't tell the full story - not by a long shot."
End quote.

The article goes on to explain that even Clinton's own budget documents show that the government's total debt actually will climb to a record $6.8 trillion by 2013 from this year's $5.6 trillion. By 2004, he estimates, Congress will need to raise the statutory debt ceiling, which now stands at $5.9 trillion.

Why the discrepancy? Its because Washington is borrowing huge surpluses from Social Security and other trust funds, replacing them with IOUs, and paying off the external debt. And it looks like the Republican Congressmen are clawing their way down to Clinton's level to join in his debauchery.

So it looks like we have another example of what Farfel referenced in his excellent post - 26691 (which was nominated for HOF by Cavan Man Msg ID:26696. I'll take this opportunity to second that nomination.) "what is the definition of 'is'?". I'll exclude the reference to the bj here, although humorous. We can add to Farfel's list - what is the definition of "Pay down the debt?". What is the definition of confiscation of productivity by the American people stored for the future? But, lastly, I'll provide the definition of naivete - anyone who thinks or expects their Social Security funds will be there when they are going to need them, regardless of which party is in office!
Leland
(03/12/2000; 10:45:31 MDT - Msg ID: 26720)
Thanks Harley
As Henri would say, I'm a "Clink". Depending on one's age,
Mr. Kosares may offer more old-age-security. Think about it.
Chrusos
(03/12/2000; 12:39:27 MDT - Msg ID: 26721)
Pensive Moods
Dear Sir Holtzman

Bravo on your recent letter from London (Msg ID:26642) �the mood is, quite rightly, a blend of many perspectives. You have set this aptly in a grand sweep of pertinent history and embellished it richly with personal wisdom.

Thank you for a choice piece

Chrusos
Mr Gresham
(03/12/2000; 12:48:32 MDT - Msg ID: 26722)
Leland & Harley
Putting together your two recent posts:

I think the Gen-Xers I see hanging out with their laptop computers at the Starbucks on Capitol Hill in Seattle -- dotcommers many of 'em -- are the ultimate Ponziers without Ponzi of all. They're gonna get their Social Security -- now! -- from us greyheads. Can you say IPO?

What is a country with a negative 2% savings rate doing? Spending each other's IRAs.

Thanks, Henri -- just call me Colonel "Clink"!
Harley Davidson
(03/12/2000; 13:03:20 MDT - Msg ID: 26723)
Mr. G...
"Colonel Clink"... I love it!
Leland
(03/12/2000; 13:41:33 MDT - Msg ID: 26724)
"Colonel Clink"
I am pleased to meet ya, sir. How I met Michael, it was
last year. I had used my PNC debit card to purchase some
gold eagles, and Michael called back to tell me that the that my charge was "denied".

I explained that my debit balance was in excess of $100K,
and I couldn't understand, but that I could mail a check.
Michael agreed and shipped before my check could have
arrived.

Tis an honor to be here. Thanks Michael.



4Ducat
(03/12/2000; 14:12:16 MDT - Msg ID: 26725)
Envision Whirled Peas
Http://www.dailyreckoning.comHi-Hat, I also think that wars and violent conflicts are on the horizon. If we consider what economic situation led to the rise of Hitler who was an economic savior of Germany in the early stages of his rise to power. What is the difference with that repudiation of WWI debts to the present debt climate the international bankers have set up. They fanned the flames of speculation in Asia then pulled all their cash out. Prices collapsed. Then they rush back in with IMF bailout loans demanding more open markets so they can "buy Asia" at firesale prices. This is why Indonesia and Malyasia are in revolution right now. Their economy was plundered by international bankers aided by the rich families who sold out their country. Asia is sinking deeper into debt with Japan at the forefront. The pump-priming techniques we told them to do are a failed mistake because we are not dealing with an Anglo-saxon mindset. The Japanese are far more austere to save and hate to spend. The money pumping machine is destabilizing Japan an shows no sign of providing the recovery we claimed would occur. The average Japanese is probably sitting on a small pile of cash and still just as baffled as to what the future holds. They have no concept of any economic system apart from an export led model. How would you think if you lived on a rock in the Pacific? So we are setting up ourselves for a leader to rise in Asia who will unify and repudiate debt to throw off the shackles of international banker's enslavement. I only believe this because the debt levels are not the issue but the direction of the compounding indebtedness. They are all in a hole and the policymakers advise them to dig their way out. The hole is getting deeper. China will devalue its currency to maintain status as the lowest cost producer, if only to keep everyone employed. This wipes out business for the other tigers. It can cap the led on their debt pressure cooker. Without the ability to export the quantities of goods needed to raise cash, they will need another bailout, or undergo debt forgiveness or get loan extensions. So then US policy revolves around maintaining the status quo to make sure the loans get paid back and at worst to further the enslavement. Quite a job finding friendly despots to strangle their home populations to pay off loans the people never benefited from. Maybe this is why Americans are so loved everywhere we go overseas. Are they throwing flowers or bricks out the windows at us. Then they meet you and say "We know it isn't you, it's your government."

It has been said that Democrats get us into wars. All this caving in to buy peace at any cost makes us look like a bunch of wimps. Land for peace dealings in Israel? If you resurvey your backyard and give us the title then we will temporarily stop shooting through your house. Then we apply Chicago-ghetto policy solutions to Bosnia that have been at war since Bible times. We think segregation is a moral crime. What if both sides each can achieve the same standard of living. Ask me this, Is the farmland so different. Seagulls and crows eat the same food live in different areas and I haven't yet seen a major conflict. We have red-lined real estate districts set up naturally all across America. You can't stop like people from wanting to be with like people. I'm saying these bumpkins we elect don't have a clue as to foreign policy. It all turns into a campaign finance cash grab. After 8 years of "cash grab" foreign policy do you think all these little countries are more or less stable? You say who cares, they all sleep in the dirt anyway? Well when your sons get drafted to breath the biological brew that they have packed in the warheads, then you can think about whirled peas and heaven on earth. We have a massive debt in peacetime, what will happen in wartime? There is no civil defense program in the US. None,zip, zilch. "Stand under a doorway or climb under a desk". If one bomb went off it would be total chaos. What the bomb didn't get the panic selling would. Oh, don't talk like this. Pakistan and the India want to make love not war.
OK forget the entire screwed up climate of US foreign policy. Do we have enough war hardware to police two hemispheres? Well as to violent fighting manpower I guess we have no problem. All the jails are filled with psycopathic youth grown up into adulthood. With killer computer games and paintball gunbattle training, we do have some dogs to unleash. I'm saying war is not soley a product of politics but is partly a byproduct of violence in society. Violence smoulders and eventually breaks out. One Rodney King incident and this violence broke out. Take away the bread and the circus and you'll end up with Road Warrior III. This racial conflict in the US the European leaders relish in the thought of it. They will probably try to get it to kick off to bring us under the soviergnty of the UN. Communism may be dying in Russia but it's alive on college campuses that still study Nietzie and Marx.

Spelling and grammer are hell on a forum such as this. Thanks for bearing with me. Still I'm positive on gold and for those smart enough to precede the movements of crowds, for them I write. For in the real world the strong get stronger and those who avoid reality only discover more delusion.


Peter Asher
(03/12/2000; 14:39:38 MDT - Msg ID: 26726)
Leland (3/12/2000; 8:45:43MDT - Msg ID:26716)

>>>> Will people 80 years from now talk, without quite knowing
where the term comes from, about being bezosified or qualcommed? <<<<<

If it's the debt bubble that brings it all down, (which I think is more likely) then the losers will be the creditors of the world. Then the term might be "Fractionalized."
HI - HAT
(03/12/2000; 14:59:56 MDT - Msg ID: 26727)
4 Ducat PEAS IN A POD
Yes you are right. This is one big phantasamorgorical'surreallistic pressure cooker. To me it is some kind of misplaced concretion to think this can all be contained. If economic breakdowns escalates and shortages of basic supplies ravage the world the heat under the cooker will red line.
Canuck
(03/12/2000; 15:01:13 MDT - Msg ID: 26728)
'Ides of March'
A couple of posts have mentioned stock market repercussions on the 'Ides of March'. Can someone let me know what the 'Ides of March' is/are and why a few feel this will be a landmark day for the stock markets?

TIA.

Canuck.
Leland
(03/12/2000; 15:03:31 MDT - Msg ID: 26729)
Peter, I Agree
The nation has had its longest boom in history, but it
is "ised". Now, howdawe reverse? I'm too dumb to figure
this.
Al Fulchino
(03/12/2000; 15:03:48 MDT - Msg ID: 26730)
Canuck
The Ides of March as in "Beware the ides of March Caeser"
It was on this day back in _______ , that Caeser was murdered.
Canuck
(03/12/2000; 15:24:09 MDT - Msg ID: 26731)
General questions
I went to a coin show in Ottawa today. (Nepean Sportsplex; every second Sunday in the month)

Lots of old, presumably rare coins and commenorative stamps. It was very interesting.

No quantity of precious metal but did fall upon a three 1 oz. silver 'squares'??? What are these called?

What is a wafer, a bar, a round?

The gold oz. I have are called 'wafer' if I recall correctly. Is a wafer a small bar? One onze has "JM
ASSAYERS, FINE SILVER 999, 1 OUNCETROY" The second once has "SUISSE ONE TROY OUNCE 999 FINE SILVER" The third has
"ENGELHARD INDUSTRIES REFINERS & ASSAYERS 1 oz troy SILVER
999 fine"

I asked one fellow if he had Maple Leaf(s) or Eagle(s). He said no, he only collected 'coins'? I was lost at that point.

He asked me if I was investing in silver. I answered yes; he told me coin was not the route to go; see a dealer and buy 10oz/100oz bars.

Can someone help me, thoughts, 'links', advice.

TIA,

Newbie.
Canuck
(03/12/2000; 15:26:40 MDT - Msg ID: 26732)
@Al F.
Thank you Sir.
Henri
(03/12/2000; 15:53:15 MDT - Msg ID: 26733)
Gold wafers
There is one (1 oz) Credit suisse bar left in the inventory of a popular digital gold site it can be redeemed (take delivery). Hurry before its gone! I did NOT name the website Michael and I did check to see if Centennial had any advertised for sale first.
Galearis
(03/12/2000; 16:09:43 MDT - Msg ID: 26734)
@Henri
I know the Credit Suisse thingy was a jest, but seriously this is not a reputable organization for purchasing pms. I own a silver wafer made by these folks that states on it "one ounce fine silver". It is smaller than my JM wafers and for good reason. It really is only one ounce - not one troy ounce. They didn't lie, but.........

They are, of course, a member of the CABEL.
Canuck
(03/12/2000; 16:28:49 MDT - Msg ID: 26735)
@ Galearis @ Henri
You guys have made mention of 1 oz. bar and 1 oz. wafer. Are the terms wafer and bar interchangeable?

The Suisse 'wafer' has the acronym (word) PAMP and CHIASSO on it. What are they?

The JM 'wafer' is approximately 50mm x28mm x2mm, larger but thinner than the SUISSE 47mm x27x 3mm.

Thanks.
Galearis
(03/12/2000; 16:47:03 MDT - Msg ID: 26736)
@ Canuck, your 15:24
Canuck (3/12/2000; 15:24:09MDT - Msg ID:26731)
General questions
I went to a coin show in Ottawa today. (Nepean Sportsplex; every second Sunday in the month)

Lots of old, presumably rare coins and commenorative stamps. It was very interesting.

No quantity of precious metal but did fall upon a three 1 oz. silver 'squares'??? What are these called?

What is a wafer, a bar, a round?
***********************************************************
This seems to be the time for wafer and small pm buy questions. Sir Canuck since you live in Ottawa which I am sure has no small number of coin dealers, I suggest you let your fingers do the walking through the yellow pages and locate some of these folks who also deal in bullion. Many do.

I have my favourite coin dealer who is into all manner of these collectibles - including bullion, commemorative/novelty rounds and wafers, bullion wafers,
bullion bars and pm coins, both domestic and foreign. He is not unique by any means.

Many refineries turn out bars and wafers. Credit Suisse, JM, Englehard, Silvertown and I presume many others I have not seen. Wafers are roughly coin thick and weigh one troy ounce (or less -watch the Credit Suisse items I mentioned in an earlier post). Bars can be any shape or weight from 5 oz up to 100 oz. Make sure they are all marked "troy" with an assay purity rating (99% or better). Be aware that there are 925 bars out there too. Dealers will all have their individual pricing formula based on some function of spot. Many use the next month's future spot plus their mark-up - usually 30% for 5 - 10 ozers. Coins, Maples come with an added premium and are not recommended. The rate right now is around $14.95CAN each for hedged coins.

But the best all round greatest deal for bullion has got to be the novelty wafers and rounds. They are produced in the US and come dated 1999, Easter 2000 etc. are are the same weight and grade as your Maples. All are one troy ounce (although some are not marked "troy") and have a variety of embossed scenes and figures on them from Santa Clause to the Lord's Prayer. The thing is when they are dated with a time or event that has since passed the dealer has more trouble Sheeple selling them and will unload with a discount. I can pick up these items from between $8.25CAN to $8.50CAN - which is darned close to spot. The problem is getting quantity from a small operator. Usually it is no problem to pick up 50 to 75 oz at a time.

As my dealer friend frequents collectibles shows, I can enjoy my other diversion and pick up cheap silver at the same time. The best of both worlds. Hope this helps.

Good luck, my friend.
tedw
(03/12/2000; 16:49:03 MDT - Msg ID: 26737)
War and Gold
http://www.usagold.com
Just my thoughts which may not mean too much.

I see dangerous events unfolding on the world scene. China,with its recent threats of nuclear attack on the US and invasion of Taiwan has set the scene for war. Tianemen square proved beyond a doubt there are murderous swine at the helm of the Chinese government. They are biding their time waiting for the right moment, but I think there is little doubt they will strike. Either Taiwan and the US bow to their naked agression and intimidation or there will be war.So I think it is not a question of if but when.
An invasion of Taiwan, perhaps coupled with renewed fighting in Korea?

The Mideast of course has always been a dangerous place and the chance of an all-out conflict remains high.

Then there is Pakistan and India, Sebia/Bosnia,just to name a few.

Gold hedging, inflation, market manipulation, and the stock market all will take a back seat to WWWIII.The history of the human race says that such an event is likely.And Gold will probably be a good investment in those times.
Galearis
(03/12/2000; 16:53:20 MDT - Msg ID: 26738)
@ Canuck
Sorry for the omission of "wafer" in my last post. They are the one ounce squares, Englehard, JM etc., and undoubtably get their name from their wafer shape.

Another tip: DO NOT BUY FROM SCOTIA MOCCATTA. They are atrociously overpriced. Your best source for quantity buys are from Kitco or similar dealer. Buy quantity to spread the shipping costs. DO NOT BUY FROM A MEMBER OF THE CABEL, their discouragement ploys are VERY expensive.
Best regards,

G
Canuck
(03/12/2000; 17:26:12 MDT - Msg ID: 26739)
@ Galearis
Thanks so much for the info. Can I review?

A 'wafer' looks like a wafer and is one ounce/onze.

A 'bar' is 5 ounce/onze plus, any shape.

What is a round? Coins not the best, stick with '999'(bullion).

I forgot to mention the 'chunk' of silver I picked up. It has the diamond 'JM' logo, '999+', '5 oz.' and is approx.
46mm x25m x14mm. It is rough, looks like it was poured in someone's basement. Is this a bar? It is heavy, silver must be denser than gold.

The gold wafer's I have are Royal Cdn. Mint 'Millenium' versions; am I ok with these?

Heard someone saying the other day, " ...am buying silver to hedge the gold which is hedging my paper..." Any sense in that statement?

TIA

Canuck.

P.S.: The coin vendors/collectors had lots of silver dollars, quarters, dimes (CDN pre-1968). Are these 'junksilver' at 70% purity?
Primus
(03/12/2000; 17:27:52 MDT - Msg ID: 26740)
@4DUCAT
4Ducat

Succinctly, you're my kind-a guy!

By chance, are you a Vietnam vet?

Primus
Canuck
(03/12/2000; 17:28:42 MDT - Msg ID: 26741)
@ Galearis
PPS: Is 'ounce' British and 'onze' American?
ced_s
(03/12/2000; 18:38:19 MDT - Msg ID: 26742)
TOCOM may extend cap on Palladium
TOCOM caps Palladium market to protect the little guy on the wrong side of the trades ?? That is just a smoke screen to protect the institutional investors.
The same could and is happening in the Free Markets of the good old U.S.A. Did I say "Free Markets" ??? We have to ask Secretary of the Treasury, Summers about that and he will either not answer or lie about it.



Tocom to extend palladium futures freeze
By Gillian O'Connor, Mining Correspondent - 12 Mar 2000 18:09GMT
The Tokyo Commodities Exchange (Tocom) is due to announce on Wednesday whether it is extending the freeze on palladium futures trading announced on February 23. The freeze was an attempt to curb the runaway prices which had left many small speculators with very large losses.
The price of the metal, used mainly for autocatalysts, had risen from around $450 an ounce at the start of this year to over $800 before Tocom's intervention, thanks partly to a genuine shortage of metal, partly to a squeeze in futures,
where Tocom is the main market. Most metal is sold directly to industrial customers, but prices in such deals are often linked to exchange prices.
Since Tocom's price freeze, spot prices in the London market have fallen back to $705 on Friday afternoon, and many investors on Tocom have closed out their positions.
"It is difficult to predict how Tocom will proceed," said Ross Norman of Precious Metals Research last week, "but quite probably their number one priority will be simply to prevent any future embarrassment by the market. Their options are either to throw trading limits wide open to allow free and unfettered trading so that longs and shorts alike can easily get out of their positions, or it is the
opposite. The opposite might entail higher margins or other initiatives to curb speculative activity which would also diminish liquidity on Tocom, in turn making it less attractive to trade on. I fear they will opt for the latter."
The underlying shortage of palladium metal, of which Russia is the biggest producer, results from the lack of exports from the Russian stockpile. World demand substantially exceeds new mine production, and exports from the Russian central bank stockpile have been needed to plug the gap in recent years.
But bureacratic red tape and/or Machiavellian market manipulation appear to have stemmed the flow, although the Russians are stressing that shipments of all platinum group metals should resume soon.
Precious metals analysts reckon that earlier this year a handful of large trading houses with long positions took advantage of the fundamental shortage to squeeze the futures market in Japan. The Tocom freeze was an attempt to redress the balance in favour of small speculators, who had been unable to cut their lossmaking positions while prices were rising.
But some fear that the Japanese may have killed the palladium futures market for good, while Russian antics have accelerated customers' search for a less volatile alternative to the metal.
Trail Guide
(03/12/2000; 19:58:28 MDT - Msg ID: 26743)
Comment
HI - HAT (03/11/00; 03:50:00MDT - Msg ID:26667)
Gold only Gold
All. Forgive the darkness of my posts. I must call it as I see it in my bones. I see WAR on a world scale. Many fronts from which it will escalate from. Conclusion drawn from inate synthesys of mass psychology. Historical crowd behavior. Trail Guides dollar timeline has been means to paper over most of the worlds divisions. This has been the new world order all along. Bread and cicuses for the world. At the end of this dollar timeline when ORO's "there is no spoon",dawns, the fall will break Alice's back and Wonderland will burn.

-----------------------------------------------
Hello HI-Hat,,,, and welcome!

I can understand the darkness you feel. When you say "Gold only Gold" that's the right track. But I don't think things will be all that bad for everyone. Ask these questions and see how people respond.

I have never thought that the world would come to a stop. After all, we have been at this for,,,,,,, 2000+ years?? It's easy for me to say that anyone preparing for a change will come out better than the person that doesn't.
Because we have to consider this in an obvious context: ----- if the world has always been in a state of change, don't the people that prepare for change always win out over those that plan for a status quo?------

Further:

I have to ask all the people that use the "New World Order" context to explain the problems: -------when has the world not had a "World Order"? ------ When have we not been organized in tribes and nations trying to get the better of the next in line? -- When has any government not acted
for the wishes of only part of society? -- Isn't it impossible for any governing body to act in the wishes of everyone?

Let's see, people war against the "order" that's controlling them. In the process they form the "Next Order" and that "order" doesn't please everyone, and on and on! So, what is "new" about all of this? Our history books are packed with conflict. I guess seeing the world the way it really is comes under the heading of -- "our growing discovery of real life"!

Mr. Farfel does a good job of defining how deceiving we are in our dealing with each other. I agree that some of these belong in the HOF, for one good reason that they do reflect how so many people preceive the market! He point's out how many groups trade in unlawful, immoral ways to take the gold bugs money. But I point out that instead of getting out of the dark alley where these crooks operate, we stand there and dare them to do some more! And they do! Can you
believe that? (smile)

I almost get the feeling that paper gold bugs get mad because the "big they" won't let the bugs win using the paper game of the "big they". Again, so when has the world been different? Did we all grow up in a USA that was nothing but a society of saints? (Outside of us on this forum, of course! smile)

No one bothers to mention that the "big they" could not play their paper game in the dark alley if none of the "little us" were there for them to play with! To use the most American of phrases to reference one's misplaced mindset:

"Knock, Knock,,,, Hello,,,,,, is anybody home up there"???? (huge smile)

Trade with MK and you will certainly be guided into "the light" and away from most of that risk!

Trail Guide
Trail Guide
(03/12/2000; 20:00:09 MDT - Msg ID: 26744)
comment
Leland (03/11/00; 11:44:19MDT - Msg ID:26681)
Al Fulchino, your 10:44:14 is echoed in the LA TIMES (Grin)
Is there a positive side to the gasoline price hikes? Phil Proctor, this column's man in Beverly Hills, heard an L.A. motorist tell "CBS Evening News": "I want to pay three or four dollars a gallon. I want to feel like I'm living in Paris." Ooh L.A. L.A.!
-------------------

Leland,
Ha, Ha! Oh yes! Most Americans don't have a clue as to how leveraged their lifestyle has become from cheap oil. The price is way up in Hong Kong too. These high values that most of the world is paying has served a purpose of rationing demand for them already. In reality their
economic structures are much more stable at even higher prices than ours.

TG
Trail Guide
(03/12/2000; 20:02:05 MDT - Msg ID: 26745)
Reply
Cavan Man (03/11/00; 20:38:48MDT - Msg ID:26697)
Trail Guide/Aristotle
TG: I have read and re-read what you have written this past year many times. The serial along the "Trail" is teriffic. I believe I know now what you mean when you say, one should hold as much gold as, "one can grasp". The grasping is not only a tactile sensation. By grasp, you mean intellectually
"grasp".
-----------------

Hello Cavan Man,
You have that in context! Once people really "grasp" the whole concept, they will "grasp" onto a much larger proportion of gold coins. We are passing through a period of history unlike anything ever before. There is at least a 50 / 50 chance that once inflation becomes obvious in official
statistics, paper gold will be driven into the dirt! That's a 50 / 50 chance that gold paper, mine shares included will experience a drop that "no one" can stand, and I mean "no one"! Paper leverage works both ways my friend!

Paper gold can go to zero, but in the process physical gold will become unavailable to price. Everyone likes to say that if physical becomes scarce, paper won't trade either! Don't kid yourself. The less physical is in supply to deliver against contracts, the more the contracts will be discounted to reflect that fact. This market has never been in such a position before and there is no precedent for it. The major players in this game will not bid on or hold a gold contract that is heading for cash settlement. Whether it's traded privately, OTC, London or Comex.

When I read where investors bemoan how "the big boys" aren't buying gold, I just smile. They don't have a "grasp" as to why a billion dollar player would "NOT" want to buy into a market that's failing from a lack of "official" credibility. LBMA volume continues to fall away, slowly spelling the end of this era.

The good thing about all of this is that we will all get to see some real dynamics at work. Yes, it's a 50 / 50 shot! The paper markets are going to go "straight up" and die, or they will go "straight down" and die. No in between. Now those are some odds to "grasp", right Cavan Man? (big
smile)

TG

Trail Guide
(03/12/2000; 20:04:24 MDT - Msg ID: 26746)
Reply
law (03/11/00; 20:53:31MDT - Msg ID:26700)
FOA "A Fireside Talk (further continued)"
(03/11/00); 08:26:08MDT - Msg ID:12
In your much appreciated "Fireside Talk (further continued)"
I'd like to point out what I believe was probably just an oversight in your proofreading? In your 4th paragraph you state..."But after 1976 they found themselves selling a resource for far MORE (I believe you meant LESS) than they realized it would bring and doing so in dollars of unknown
future value." I choose to point this out...not as a technicality because of my familiarity, but for someone reading this with less of an understanding of the context in which this occurred and which you have written, in order to avoid any semblance of confusion.

Hello law!
Thanks for reading so closely! I fully understand your point. Your perception is probably clear to everyone as it was / is the most accepted explanation. However, the truth was that most all of them "privately" didn't completely understand just how important oil was in it's backing of the dollar's first, early debt expansion.

Years prior (before 1970) to the first big price increases (between 70 and 76), the US was changing the whole world economy on advancements in oil energy use and new products from refinement. Our lifestyles were advancing in a way that reflected $10 (in gold dollars) crude, back then. Only we didn't tell anyone (smile)!

Hell, the way the market was first structured, we had to
have the Texas Railroad Commision to raise the local prices otherwise crude would almost be given away. Actually, OPEC used the TRC as a blueprint to raise world price structures because they and most everyone was blank in trying to value the stuff in real use terms. The fact that the first OPEC increases worked as well as they did was a wonder to the producers. In reality it worked more so because the US needed the price to rise to bring in more domestic reserves. (You have read how this was done through the 71 gold closure?)

Don't get me wrong, by 74 they (OPEC) were only just learning the "real" economic value of oil to the world economy. Back then, only a few understood how the US was extropalating it's debt to reflect oil use wealth. They (US) went further after 76 and were using cheap crude to inflate the whole financial structure. Yes, it was cheap in relation to the fiat dollars we were then paying for it. Some of the producers were smarter than others and really "grasped" how oil was just as valuable as a world reserve currency backing as it was was for actuall use.

I'll expand my statement:
" " they found themselves selling a resource (crude oil) for far MORE (in commodity value) than they (had earlier) (prior to 1970) realized it would bring ------ and doing so in dollars of (now) (1976) unknown future value (because their oil was the backing for the economy the dollar was based upon) (no longer gold after the 1976 Jamiaca Accords)."

Law and others, I'm sorry I can't make this more clear, but it's a very hard subject.

Thanks TG

Cavan Man
(03/12/2000; 20:11:42 MDT - Msg ID: 26747)
Trail Guide
Could it be that exporting countries (to US) did so because their market was too small to absorb all the potential productive capacity even with inflating currency?
Cavan Man
(03/12/2000; 20:13:33 MDT - Msg ID: 26748)
Trail Guide
That question hails from a recent post and I thought it was a good one??????
Cavan Man
(03/12/2000; 20:18:31 MDT - Msg ID: 26749)
Trail Guide
Let me guess. "Humanities" were your strong suite correct?
Leland
(03/12/2000; 20:46:21 MDT - Msg ID: 26750)
Some Sobering Comments About Driving in Cuba




Published Sunday, March 12, 2000, in the San Jose
Mercury News

Castro's citadel

Determined to drive in Cuba

BY JOHN RICE
Associated Press

HAVANA, Cuba -- Most Cubans can't even think of buying a car in a
country where a tank of gas can cost months of wages. Yet the streets
of Havana are clogged these days with smoke-belching traffic in a
testament to Cuban inventiveness and economic improvement.

Only five years ago Havana was an automotive ghost town; armies of
bicyclists and pedestrians ruled the streets. Now cars have joined the
maze of bicycles, pedal cabs, motorcycles, motorized bicycles and
horse carts dodging cavernous potholes in the capital's streets.

Clouds of black smoke spew from the diesel engines of old Russian
Kama trucks and from ancient American cars modified to run on diesel
engines.

The crowded streets are evidence of the U.S. dollars circulating in the
economy since Cuba legalized the possession of dollars in 1993 and
then began selling gas for dollars at special service stations.

The cost can be heavy: A gallon of regular costs almost $4. Many
Cubans make only about $10 a month.

Still, enterprising Cubans are buying. Some have relatives abroad who
send dollars. Others get dollar tips from tourists. Some finance their
cars by using them as taxis -- often without government permits.

Gasoline or spare parts stolen from the state also can be found on the
black market.

Old-style gas stations with their rabbit logo and ``R�pido'' signs still dot
Havana, but they're largely dedicated to patching and filling tires. State
rations of cheap gasoline have been slashed to a few gallons a year.

Havana's streets are a moving museum of automotive history: Sleek
new Mercedes and Peugeots fight for position with three-wheel Vespa
scooters, precariously maintained Hudsons and Russian Ladas and
Volgas -- even the odd Model A.

There are cars that most Americans have never seen: jeep-like AROs
from Romania, UAZs from the former Soviet Union and Ssangyongs
from South Korea, along with Skodas, Moskviches, and peculiar
three-wheeled jitneys shaped and painted like oranges.

And there are cars Americans might have forgotten: Simcas, Hillmans
and Morris Minors.

What rumbles under the hood is often surprising.

Many Cubans have removed the gas-guzzling engines from the
1950s-era American cars, replacing them with Romanian or Russian
diesels.

Pistons from Alfa Romeos have found their way into Harley-Davidson
motorcycles. And Cuba's creative mechanics have twisted and milled
scraps of metal to keep motors, bodies and suspensions together, more
or less.

``We repair everything here,'' said William Escalante, a burly mechanic
sitting on the curb of Del Valle Street, a center for street-corner
repairs. ``We have to invent a lot.''

A few feet away, a fellow mechanic was fiddling with wires holding
tubes to the brake master cylinder on a decaying state-owned
Moskvich. The car's windshield bore a seal certifying it had passed a
government inspection.

Worried about pollution and the safety of precariously maintained cars,
the government started mandatory inspections last year.

Miguel Cabrera Reyes, the vice minister of transportation, said 25
percent of cars fail their first test and 10 percent fail a second time.

``It's not an alarming failure rate,'' he said, though a spot check of
windshields for inspection stickers indicates many drivers of old cars
have yet to put them to the test.

The challenge frustrates some.

``If they don't give me gasoline, how are they going to make me pass an
inspection?'' complained a driver waiting on Del Valle Street while a
mechanic fixed the brakes on his 1989 Lada. Saying he didn't want to
get into trouble, he declined to give his name -- though he offered his
services as a driver.

Even some repairs can be risky. With parts hard to find, some Cubans
have found or bought parts diverted from state stocks. Each car's
registration book shows the legal source of its engine and other main
pieces. If the numbers don't match, the car can be seized.

Felix P�rez displayed the book showing that his 1959 Simca had legally
been modified with steering gear from a junked Moskvich.

``The only thing original is the motor,'' he said.

He drove to Del Valle Street with a friend holding a plastic bottle of
gasoline out the window so fuel could pour through a tube into the
carburetor. Mechanics were trying to fix his gasoline pump.

Just getting a car can be a challenge. Owners of aging
pre-revolutionary cars can sell them to anyone with money.

Some professionals have been given permission to buy cars cheaply
from the state -- mostly Ladas or Moskviches. Those cars can only be
resold back to the state, which pays far below the market value. Cars
sold illegally can be seized.

Those who work for foreign companies also can sometimes get new
cars -- but may have to give them up if they lose their jobs.

A few people, such as sports stars, have been allowed cars they can
freely sell. But buying such a car can require a signed permit from a
vice president or even from President Fidel Castro himself.
Galearis
(03/12/2000; 21:15:09 MDT - Msg ID: 26751)
@ Canuck about all those questions....
Other obligations called me away but you asked:
Canuck (3/12/2000; 17:26:12MDT - Msg ID:26739)
@ Galearis
Thanks so much for the info. Can I review?

A 'wafer' looks like a wafer and is one ounce/onze.
YES, GENERALLY BUT I BOUGHT A JM YESTERDAY THAT WAS ONLY 5 GM AND SET IN A STERLING SETTING FOR USE AS A PENDANT.
A 'bar' is 5 ounce/onze plus, any shape.
YES, BUT CAN LOOK LIKE A LARGER WAFER TO CRUDER. THIS DEPENDS ON WHO CAST IT AND FOR WHAT PURPOSE. A HUNDRED OUNCE BAR IS NOT A PRETTY SIGHT. LESSER SIZES ARE OFTEN "DRESSED UP" I PRESUME FOR POTENTIAL USE FOR PAPER WEIGHTS.
What is a round? Coins not the best, stick with '999'(bullion).
I HAVE NO EXPERIENCE WITH THESE. THEY ARE AN AMERICAN IDEA AND I FEEL THEY ARE COIN BLANKS (IN EITHER COIN SILVER OR 99 FINE. THEY SEEM TO BE UNAVAILABLE UP HERE.

I forgot to mention the 'chunk' of silver I picked up. It has the diamond 'JM' logo, '999+', '5 oz.' and is approx.
46mm x25m x14mm. It is rough, looks like it was poured in someone's basement. Is this a bar? It is heavy, silver must be denser than gold.
YES, THAT IS A BAR AND SOME ARE NOT PRETTY. I HAVE A SIMILAR ONE.

HEAVY IN PMS IS A FUNCTION OF THE RESPECTIVE ELEMENT'S SPECIFIC GRAVITY NOT DENSITY. A DIAMOND IS VERY DENSE BUT HAS A LOW SPECIFIC GRAVITY AND IS QUITE LIGHT. LEAD HAS A MUCH HIGHER SPECIFIC GRAVITY THAN SILVER (BUT LESS THAN GOLD). THEY ARE ALL QUITE HEAVY. PLATINUM, FOR EXAMPLE HAS A HIGHER S.G. THAN GOLD AND IS HENCE HEAVIER FOR THE SAME VOLUME. SILVER IS LIGHTER THAN GOLD AND LEAD. I WON'T BORE YOU WITH NUMBERS FOR EACH.

The gold wafer's I have are Royal Cdn. Mint 'Millenium' versions; am I ok with these?

I DON'T UNDERSTAND: OK. I TRY NOT TO BUY ANYTHING FROM THE MINT, THEY ARE TOO EXPENSIVE. USUALLY YOU CAN BUY THE SAME THING FROM A DEALER FOR LESS. BUT FOR BULLION AVOID HYPE ITEMS LIKE THESE. THE DEMAND (AND PRICE) IS ALSO DRIVEN BY SHEEPLE BUYS. CHECK OUT KITCO AND COMPARE. AGAIN I DO NOT KNOW WHERE YOU BOUGHT THESE, BUT REMEMBER, GOLD IS GOLD AND IS LIMITED ONLY BY ITS PURITY FOR ITS WORTH. EVERYTHING ABOVE "SPOT" IS A MIDDLEMAN NIBBLING.

Heard someone saying the other day, " ...am buying silver to hedge the gold which is hedging my paper..." Any sense in that statement?

YUP, THESE MARKETS ARE ALL SOMEWHAT SEPARATE (NOW) DUE TO MANIPULATION. THE SOMEONE IS TALKING ABOUT A DIVIDED PORTFOLIO WHEREIN HE/SHE HOLDS A PERCENTAGE OF HIS STORED WEALTH IN EITHER THE ASSETS OF GOLD, SILVER, OR PAPER. PERSONALLY I DON'T CONSIDER PAPER GOLD INCLUDING STOCKS A PARTICULARLY GOOD INVESTMENT RIGHT NOW. I HAVE A STAKE IN TVX, FOR EXAMPLE, THAT I WILL UNLOAD AT THE FIRST OPPORTUNITY - PROBABLY AT THE FIRST SPIKE IN THE GREAT SILVER FIASCO BULL. THIS COMPANY WILL LIKELY NOT SURVIVE A LARGE SPIKE IN POS IMO DUE TO ITS HEDGING POLICY IN THE WHITE. I HAVE HEDGED WITH THE YELLOW AND THE WHITE IN PHYSICAL FORM.

TIA

Canuck.

P.S.: The coin vendors/collectors had lots of silver dollars, quarters, dimes (CDN pre-1968). Are these 'junksilver' at 70% purity?

MORE OR LESS TRUE. TRY TO BUY DOLLARS ONLY - A BARTER "HEDGE". MOST PEOPLE DON'T KNOW OF THE SILVER CONTENT OF 50'S. 25'S AND 10'S. OR YOU CAN SHIP THEM ACROSS THE BORDER FOR A MELT.

AND A WORD ABOUT SPELLING. AMERICANS FINALLY HAD TO COME OUT WITH THEIR OWN DICTIONARY. LANGUAGES EVOLVE AND SPELLING DEVOLVES ;^). I USE THE BRITISH OUNCE. IT'S A LITTLE LIKE THE IMPERIAL GALLON VS THE AMERICAN, BIGGER AND MORE BANG FOR THE BUCK ; ^)
Solomon Weaver
(03/12/2000; 21:15:27 MDT - Msg ID: 26752)
Not on Buffet's list??
Warren Buffett's Silver
http://news.excite.com/news/dj/000311/20000311-000167
Quoting the last paragraph of the Excite article:

" Berkshire's annual report also showed that Walt Disney Co. (DIS) no longer is a core holding in its portfolio. Disney was not among the year-end equity stakes exceeding $750 million. At the end of 1998 Berkshire's Disney stake was valued at $1.5 billion, and was on the core-holdings list. The report doesn't disclose whether or not Buffett sold his entire Disney stake. "

Since the 1999 Annual Report does not mention silver anywhere that I can find... who at this Round Table sees the significance of this statement (which also says zero about silver) with regards to Warren Buffett's Silver holdings, reportedly 130 million ounces?
----------
Jason

Could it be that at this low silver price, the value of Buffet's silver is less than $750 million and so didn't make the list of core holdings???

What is his disclosure obligation?


Poor old Solomon
Solomon Weaver
(03/12/2000; 21:26:23 MDT - Msg ID: 26753)
New item by TED BUTLER
http://www.gold-eagle.com/gold_digest_00/butler031200.htmlhttp://www.gold-eagle.com/gold_digest_00/butler031200.html

Ted Butler has issued an open letter to silver mining cos and shareholders thereof.

One thing to note is that many metal miners (including gold companies) have felt free to forward sell their silver since it is not a core business...for example to a zinc and copper miner who has about 5 million ounces of silver per year, the $25 million revenue is small compared to hundreds of millions.

What Ted points out is that to the extent that in certain cases, the "sales" are actually options that leave the seller in the position of creating serious negative positions at prices much higher than $5.

I personally think he is taking the cart a little too far, but I don't doubt that a big spike in silver could suddently cause some big problems for certain companies.....

Poor old Solomon
OverHerd
(03/12/2000; 22:01:49 MDT - Msg ID: 26754)
Mr. G the colonel
Mr Gresham (3/12/2000; 12:48:32MDT - Msg ID:26722)
What is a country with a negative 2% savings rate doing? Spending each other's IRAs.

Thanks, Henri -- just call me Colonel "Clink"!


Yes, too bad we now live in a land of Sargent Shultz's

joe
OverHerd
(03/12/2000; 22:03:54 MDT - Msg ID: 26755)
New Web Page
http://www.usagold.com/cpm/aboutcpm.htmlTownCrier (03/10/00; 18:55:28MDT - Msg ID:26654)
Meet your host...Centennial Precious Metals
http://www.usagold.com/cpm/aboutcpm.html

Hi MK and TownCrier I like the new page. I'm honored; your company in both meanings of the word, and your web site has become a special part of my life.
Thanks,
Joe
oldgold
(03/12/2000; 22:04:01 MDT - Msg ID: 26756)
Farfel
You post about that snake Larry Kudlow was right on the money. My detestation of that slimeball is almost as great as my dislike of out noble President. This guy has got to know that the gold market is grossly manipulated -- yet he still shouts the same lying tune over and over -- the depressed gold price proves that there is no inflation in the US economy today.

But do not tar all on Wall Street with the Kudlow brush. Morgan Stanley chief economist Steve Roach has for some recognized that we are in a dangerous bubble and has urged Greenspan to tighten aggressively.
OverHerd
(03/12/2000; 22:14:14 MDT - Msg ID: 26757)
Kudlow
Hi OldGold and Farfel,
I saw Kudlow on the Stock shopping channel, AKA CNBC, saying that the huge debt this country has is the reason that the dollar is the world reserve currency. Huh?
That perticular infomercial was talking about how it wasn't a good thing, the President's plan to pay off the debt. Pretty good acting, he really tryed to sound convincing and make believe there really was a plan.
Netking
(03/12/2000; 22:52:07 MDT - Msg ID: 26758)
NASDAQ A/D Line
http://207.175.234.19/comex/default.htmRepost;
For those of you who are uncertain about whether the POG
will eventually rise. Click on the following URL, this
should be proof enough.


SLF
(03/12/2000; 23:38:25 MDT - Msg ID: 26759)
Questions for the forum from a year long lurker
Trail Guide says gold spot has a 50/50 chance of going up or down. If one is honest this is about as good a forcast as you are going to get.

Tell me what you think about this plan, and how I might improve on it. I will use a number of $500,000 to illustrate.


Say you have $500,000 to invest in gold. You take $250,000 and buy 1 ounce bars and coins. You take $150,000 and buy a selection of non hedged speculative junior gold mining shares, and the last 100,000 you hold in cash.

If gold should go up to $400 dollars an ounce you sell your mining shares, hopefully for a 5 bager or better and buy 4 times as much physical as you could if you went out and bought now.

If gold should go down, sell out of your mining shares before you loose more than 50% and wait for gold to reach $200 an ounce. Take the $100,000 cash and the $75,000 remaining from stocks and buy as much physical for $200 an ounce as you could have if you bought $250,000 worth now.

What are the chances of this being pulled off? We bought physical at $252. Will we be able to buy physical at $200?

Thank you in advance for your thoughts on this plan in the shaping. I have learned a lot over the last year and am learning more every day.

Thanks to all

tg
(03/13/2000; 00:13:13 MDT - Msg ID: 26760)
Hedging your bets SLF
I am getting overly cynical, but when someone says to me that gold is a 50/50 chance of going up or down, it really means that they don't really know which way gold is headed.

Your odds in roulette or almost as good.
View Yesterday's Discussion.

Netking
(03/13/2000; 00:19:27 MDT - Msg ID: 26761)
War & Gold Cont.
@tedw (3/12/2000; 16:49:03MDT - Msg ID:26737)

Ted, I cannot fault your logic - fair comment.
The greater the propensity & degree of human misery in the days that are ahead (and they ARE a'commin) the greater the perceived value of gold will be.
Gold will be & always has been a storehouse in troubled times.
Simply Me
(03/13/2000; 00:20:55 MDT - Msg ID: 26762)
@Canuck, et al
It's late...so maybe you'll see this tomorrow, Canuck.
The Ides of March is March 15th. The line "Beware the Ides of March" is spoken by a fortune-teller in the play "Julius Ceasar", warning Ceasar not to go to the Senate that day. He doesn't listen. In the play, the Ides of March is the day a group of Roman senators stab Ceasar on the steps of the senate. As he lay dying he recognized a friend in the group and addressed him, saying, "Et tu, Brute?" (You too, Brutus?)
I believe "Julius Ceasar" is by Wm. Shakespeare...but it's been a long time since my days of study, and I think all the best writing is from him!
So, the Ides of March is bad luck because it symbolizes being stabbed in the back by your friends.
FWIW
simply me
Netking
(03/13/2000; 00:25:59 MDT - Msg ID: 26763)
SLF
SLF - have you been smoking crack Sir or spending too much time in gambling establishments. A 50/50 chance?

Henri
(03/13/2000; 00:53:33 MDT - Msg ID: 26764)
SLF
It appears that your strategy assumes that every one of the Junior Spec Non-hedged mining venture you "invest" in will pay out a 4-5 banger. More likely 1 in twenty will be successful..the rest will lose money. Perhaps you meant that the average return would be X5 is one of your speculations hits paydirt and is also wildly sucessful in a dotcom sort of way.

If so I have this to say about the strategy.

"Sounds like a plan" but then "The best laid plans..."
tedw
(03/13/2000; 03:25:46 MDT - Msg ID: 26765)
Bill Murphys speech to the Alaska miners
http://www.usagold.com
Well worth reading.

check it out at www.lemetropolecafe.com
Black Blade
(03/13/2000; 04:04:42 MDT - Msg ID: 26766)
Inflation expected to increase!
http://cbs.marketwatch.com/news/current/econ_preview.htx?source=htx/http2_mwThe CPI and PPI numbers may surprise the so-called experts this week due to higher oil prices. The gubbermint may try to monkey with the numbers in the core rate, however, it is expected that the higher petroleum costs will show up in finished goods passed on to the consumer. Hard to hide these numbers over the long-haul, but the powers that be have done it so far.

Also, the Asian markets are tanking HARD overnight. The Nikkei down 2.8%, and Taipei down sharply as well!

The S&P futures look toward a sharp drop in NY on Wallstreet at the open! S&P futures down -14.30! On the brighter side is that Au is up $1.40 and may be poised to climb throughout the trading session if negative sentiment carries on through the US equity markets. Any more negative earnings reports (ala Proctor and Gamble) could help push the DOW index into recession mode. Looks like the fireworks could explode today, we shall have to wait and see. At least it should be a wild ride!
transparent
(03/13/2000; 04:13:24 MDT - Msg ID: 26767)
Govt. manipulation of inflation numbers/ Dollarization In Latin America
http://www.joelskousen.comWORLD AFFAIRS BRIEF March 10, 2000 Copyright Joel Skousen. Quotation
with attribution permitted. Website: http://www.joelskousen.com

GOVERNMENT MANIPULATION OF INFLATION NUMBERS
The Shadow Bureau of Government Statistics in Hawthorne, N.J., issued an
alert this month about extreme government manipulation of the Consumer
Price Index (CPI)--the official US Government statistical index of
inflation. The Bureau of Labor Statistics (BLS), which runs the CPI
calculations, reported that for January the CPI rose a mere 0.2 percent
. They also reported that producer wholesale prices were unchanged for
the same period. How can this be, given the huge rise in both wholesale
and retail prices of gasoline and heating oil? The secret, according
to Williams, is "Intervention Analysis." The BLS admits in a footnote
that,

"the BLS has used an enhanced seasonal adjustment procedure called
Intervention Analysis. For the fuel oil and the motor fuels indexes,
this procedure was used to offset the effects that extreme price
volatility would otherwise have had on the estimates of seasonal
adjusted data for those series."

In other words, not only does the BLS eliminate all seasonal spikes in
prices, it also squashes any huge spikes in gasoline prices, supposedly
because it is a temporary phenomenon. William's group estimates that
the real CPI was understated by a full percentage point for the month,
giving an annualized rate of inflation of near 14%.

ANALYSIS: Temporary price increases or not, the public is paying these
outrageous gas prices and it does affect everyone's cost of living. By
the way, gasoline isn't the only item manipulated on the CPI. Housing
costs are converted to "equivalent rents" and then manipulated downward
to obscure double digit rising costs. Dental and professional fees are
skewed so that they only show only the lowest average prices charged at
"base rates". Many items are simply removed from the CPI list when they
start inflating rapidly, and substituted with others in the typical (or
mythical) BLS "shopping basket."
This kind of government abuse of their fiscal duty is outrageous and
has monetary consequences for millions of people. Bond and stock
valuations as well as interest rates are skewed without accurate
expectations of inflation. Many government and private pension programs
are indexed to the CPI. When government fudges the numbers it allows
pension managers to evade payment of the full and rightful adjustment.
Everyone's cash and savings are being eroded at a faster pace than they
realize and banks are allowed to continue the charade that paying a
paltry 3% interest rate is a "fair deal." The government saves billions
in indexed payments to retirees, which in turn, allows politicians to
overstate the supposed "surplus." It is also an essential part of
government policy to hide double digit monetary inflation so as to
conceal the long-term effects of the Fed's expansionist monetary policy.

THE FED INVITES DOLLARIZATION IN LATIN AMERICA
The Federal Reserve held a meeting of central bank leaders from
Argentina, Brazil and Mexico on March 6 and 7 in Dallas, Texas to invite
these three nations to consider the advantages of adopting the US dollar
as their official currency. Ecuador is already working closely with the
Federal Reserve to implement dollarization in that unstable nation,
although there is considerable opposition. The Left sees this move,
promising economic salvation, as a covert effort at bringing Ecuador
into NWO control.

ANALYSIS: Latin American Marxists are right. The IMF and Federal
Reserve are pushing dollarization, ostensibly to help inflation ravaged
nations like Ecuador and Brazil to stabilize their economies, but in
reality, there is a trap involved. Each nation that starts using the US
dollar as their official currency loses financial sovereignty and
becomes hostage to the inflationary practices of the Federal Reserve.
If the Fed has to bail out the US economy by rapid inflation, every
country that is using dollars will see those dollars depreciate. In the
short term, Latin American countries can only benefit from this
regimen. These countries are some of the most notorious inflators of
currency in the history of the world, and need to be stripped of that
power to inflate. No government should possess this power to debase
value. Eventually, the NWO elite want all of Europe strapped to the
Euro and all the Americas chained to the dollar. This will lead the way
to regional monetary control, as part of the NWO.

There is a hidden benefit in all of this to the Fed and the US dollar.
The Fed has been inflating the dollar at high rates for over 30 years.
The only reason this hasn't shown up as hyper inflation here in America,
as in Latin America, is that a huge portion of these dollars have been
absorbed by international trade around the world. This dollarization of
international trade has given the US unprecedented powers over world
commerce, and has allowed the US government to spend with near abandon
without having to face the inflationary consequences nor higher tax
rates needed to finance, that profligate spending. Now that Europe is
trying to actively undermine US financial hegemony, there is a concerted
attempt to replace the dollar with the Euro for international trade in
Europe and the Middle East. I think the US is pushing for dollarization
in Latin America in order to provide a secondary haven for those dollars
when the dollar loses favor in Europe.

The preliminary vehicle already in use by nations to begin the
dollarization process is to establish a Currency Board, which is a board
of government officials tasked with pegging the local currency to the
dollar. They do this by claiming to hold in reserve one dollar for
every unit of local currency in circulation. This takes a while to
achieve (if at all), and must be actively supported behind the scenes by
NWO monetary controllers who see to it that Currency boards get a lot of
loans from the IMF to support their dollar reserve needs. Usually,
currency boards do not have full backing of dollars, but as long as
everyone thinks they do, the illusion of parity remains. Most Latin
American countries fudge the figures so they can still inflate and
maintain the illusion of dollar parity at the same time. Over time, the
markets discover the hidden inflation, and pressure mounts to exchange
inflated pesos for dollars. This market discipline is the only thing
keeping government spending in check. Ultimately, the system will
unravel unless a country begins real dollarization by putting the
reserve dollars into full circulation.

Here are the advantages to the nation using the dollar.
� It lowers the cost of doing business internationally since currency
exchange costs are avoided.
� It makes it easier for US businesses to invest in these nations.
� Local interest rates match US rates spurring growth due to lower costs
of borrowing.
� Increased investor and business confidence in the predictability and
stability of dollar- based prices.

What is the downside? Politics in Latin America are heavy into buying
votes with social benefits and government contracts. Latin American
governments are notoriously corrupt institutions. Their people are
benefit corrupted and will toss out any government that cannot keep
their benefits flowing. Without the power to inflate, governments have
to borrow and tax, which is unpopular and depresses the economy.

The bottom line is that dollarization will temporarily add discipline
to these countries. Politicians will simply not have the power to
inflate, although they can still engage in deficit spending. When they
get in deeper than their markets can bear, they will have to come
begging to the International Bankers. This is the kind of ultimate
financial dependency that NWO leaders are counting on--a financial
collar around the necks of every Latin American nation that will cement
them into NWO control. Dollarization is the first step toward forging
those chains.
Canuck
(03/13/2000; 04:27:24 MDT - Msg ID: 26768)
@ Simply Me
Thanks for the info. (Ides of March)
Canuck
(03/13/2000; 04:54:34 MDT - Msg ID: 26769)
@ Galearis
Thanks for your lastest response; really appreciate the information. I hope it has helped others as well.

The 'Millenium' wafers I bought were from a dealer and I recall they were about 10-12 dollars (CDN) above spot so I can live with that. I watch this local dealer closely, he sells about 10 above 'spot' and buys about 10 below 'spot'. I'm watching the 'spread' for changes and also for the divergence from the quoted 'paper' price.

I'm beginning to understand the 'nature of the game'; I'm spending less time trying to understand why. I guess the 'crooks' are being 'crooks' because they are 'crooks'.

As one our (USAGOLD) posters says, "... I hope they all die"
Well, I guess they don't have to die, but just let go of the gold for Pete's sake.

I will attend this little coin show every second Sunday of the month gathering silver dollars, wafers, bars etc. A couple 1/4, 1/10 gold nuggies would be a great find. As someone said recently, "...you don't need to panic buying a wheelbarrow full of physical at once...buy a little, pick up a little more, and be ready for the crunch..." This was from another (I like the word ANOTHER) site.

Again, Sir Galearis, thanks for your time and wisdom. It is indeed a credit to USAGOLD that we have a collective group of '999 fine' souls.

Canuck
HI - HAT
(03/13/2000; 05:03:02 MDT - Msg ID: 26770)
TRAIL GUIDE HOPE
First, and above all thankyou for your teachings. I do regard myself as a student of yours in these golden matters.In my world ORO wears the robes of a professor as well. When exposed to the bonfire of the gold stocks, my reaction was that of a newly diagnosed terminal patient. Stranger you may be relating to this. I ran the gamut from shock, denial, anger, fear, hope, acceptance. I am accepting but hoping for a miracle spike as I want to WIN.I guess were talking gamblers bet fascination. In regards war. You say " I don't think things will be all that bad for everyone". " I have never thought that the world would come to a stop". I'll buy that, but as probability is only the child of uncertainty and as we all stand around the table my concern is how our chips bounce when ala w.w.2 the big dice are rolled. NEW WORLD ORDER CONTEXT The new world order to me is at any given historical time the battle of dominance to see who gets to eat the choicest part of the mastadon first. Thr order part being the rules on the entry tickets that all must have to enter the arena of MAMMON.
Black Blade
(03/13/2000; 05:24:41 MDT - Msg ID: 26771)
World Markets Tanking Tonight!
S&P Futures down -18.80, Nasdaq limit down! Looks to be a wild ride on the Street at the open! Overseas, markets are down across the board. Look for the same in NY!
The Invisible Hand
(03/13/2000; 05:49:26 MDT - Msg ID: 26772)
The best laid plans ...
Sir Henri and All,

Concerning certain, strategies you're writing:
<"Sounds like a plan" but then "The best laid plans...">

What about the plans of those whose choose to invest in beautiful Maple Leafs? Will their plans never go wrong?
Or are their theories doomed also?

But then again, Harry Browne is running for president, again - smile.
Black Blade
(03/13/2000; 06:25:57 MDT - Msg ID: 26773)
S&P Futures down -24.70!!!!!
Look out below!!!! Very sharp drop in NY at the open. The bubble is bursting!!!! It looks to be an ugly open on Wallstreet.

Hey, let's buy the dips :-)
SteveH
(03/13/2000; 06:39:22 MDT - Msg ID: 26774)
I agree...exactly so...
http://www.sightings.com/ufo6/guns.htmeom
Henri
(03/13/2000; 06:49:55 MDT - Msg ID: 26775)
Screamin' short term rate rises this Morning
...Dollar up marginally and gold down $2.50? US Stock issues down in Europe especially computer and internet shares. Looks like they are hitting our soft underbelly ;-)
Henri
(03/13/2000; 06:52:58 MDT - Msg ID: 26776)
The Invisible Hand
A "clink" are you? Well, then I would think that the ML strategy success will depend on where you reside and how likely your govt is to want your stash.
Trail Guide
(03/13/2000; 07:01:29 MDT - Msg ID: 26777)
Comment
tg (03/13/00; 00:13:13MDT - Msg ID:26760)
Hedging your bets SLF
I am getting overly cynical, but when someone says to me that gold is a 50/50 chance of going up or down, it really means that they don't really know which way gold is headed.
------------------------

Hello tg,
In my view, a cynical "grasp" of this gold market is one where a person cannot separate between paper gold and physical gold. I agree, anyone that plays the gold derivatives game has no more than a 50 / 50 shot. I advocate the physical only game where one has a .9999 shot!

As such, a lot of old paper traders are now buying gold itself for what used to be a "paper trade"! Bars, old world coins, bullion coins and rare coins are being purchased with an eye on selling some of them at huge percentage gains later.

The big difference today is that physical gold advocates are the minority players in this game and have the largest leverage. Paper gold traders are no longer "the contrary" players as they are in a majority. We only have to look at the volume of paper trading going on around the world to see
that paper gold, in all forms out trades the physical ten to one (at least). In addition the very leverage they play for will work against them as it has already done. Truly, the paper player has just a 50 / 50 shot.

And that:

------ " " really means that they don't really know which way (paper) gold is headed " " ! (smile)

-----------------
From my post:

Trail Guide (3/12/2000; 20:02:05MDT - Msg ID:26745)

------There is at least a 50 / 50 chance that once inflation becomes obvious in official statistics, paper gold will be driven into the dirt!-----------------

---------Paper gold can go to zero, but in the process physical gold will become unavailable to price-------

----The major players in this game will not bid on or hold a gold contract that is heading for cash settlement. ----

------Yes, it's a 50 / 50 shot! The paper markets are going to go "straight up" and die, or they will go "straight down" and die. No in between.---------


Thanks TG
Trail Guide
(03/13/2000; 08:13:30 MDT - Msg ID: 26778)
Comment
HI - HAT (03/13/00; 05:03:02MDT - Msg ID:26770)
TRAIL GUIDE HOPE
-------------------------------------------

Hello Hi - Hat,
I do hope the gold market is resolved in a major "UP" spike that kills the shorts and the paper they road in on! At least that outcome will give the mine stocks a temporary spike. Remember, I own a small percentage of a gold mine also.

This would be the absolute, best way for this to resolve itself. But even in this, our present era is unlike anything before it. If we do have a paper destroying spike, physical gold will "immediately or eventually",,, at least match the mine stock run (or even pass it by -- by a hugh margin )! Making all the risk one assumes in holding paper a needless one to take. Even if the stocks outrun physical by 20% or 30% for a while, that return will not make it a "break even" for most long term holders.

I never entertained the idea that the paper markets could diverge from the physical in a down spike. It was Another that made that point about a year ago. It completely caught me off guard. But still, I made physical my #1 percentage holding because it will outperform in the long run.

Looks like the currency war is starting to impact the markets now! I'll be updating the Trails Page later.

Michael and TownCrier: Nice job with the new web home page! Now I know what MK looks like,,,,,, yup,,, he's a goldbug,,,,, can see it in his eyes! (smile)

TG
USAGOLD
(03/13/2000; 08:13:38 MDT - Msg ID: 26779)
Today's Gold Report: Gold Up; Could Be an Interesting Week for All Markets
http://www.usagold.com/INFOPACKET.html3/13/00 Indications
�Current
�Change
Gold
290.80
+2.30
Silver
5.14
+.03
Gold Lease Rate
0.4038%
+0.0425
Gold Comex Stocks
1,437,004
+63,108


Market Report (3/13/00): Gold started the week on a positive note. Gold is
reacting primarily to the dollar getting hammered against the euro and yen,
and world stock markets in an ugly overnight slide. A sharp fall in Asian and
European equity markets -- the biggest in Tokyo this year led by high-flyer
technology stocks -- overnight had investors thinking yellow, and what
started as a mild rally overseas gained momentum as New York trading opened.
This week we have some important government numbers being released including
producer prices on Thursday and consumer prices on Friday. The gold market
appears to be undeterred by the upcoming Bank of England auction on March 21.
These sales have been pretty much factored into gold pricing already and have
had a decreasing effect on the market as they've progressed -- something we
predicted when the BOE first made its announcement some months ago. Recent
surveys show the British public largely opposed to the sales. A heads up --
Along with the gold auction on the 21st, the Federal Open Market Committee
will be meeting to determine the course of interest rates and the trade
balance figures will be announced. It should be an interesting week,
particularly as we move towards the weekend.

That's it for today, fellow goldmeisters. We'll see you here tomorrow.

If you are looking for a pro-gold view of the various financial markets as
well as a summary of the events affecting the yellow metal, our monthly
newsletter might be of interest. News & Views -- Forecasts, Commentary
& Analysis on the Economy and Precious Metals has been characterized
as witty, urbane, intelligent and down-to-earth. Not to mention it's Free of
Charge If you want to keep up with gold, this is the way a large segment of
the gold owning public does it, and has done it for over a decade.

Just click here ---> ORDER FORM <--- and make the appropriate entries.
TownCrier
(03/13/2000; 08:23:50 MDT - Msg ID: 26780)
Bank of Japan Policy Board member Nakahara says BOJ mustn't end zero rate
http://biz.yahoo.com/rf/000313/dl.htmlToday's release of data shows that the Japanese economy contracted 1.4 percent (Oct-Dec) from the previous quarter...which was also in contraction. Nakahara indicates the private sector has yet to take over the reins from the public sector to stimulate growth. This is interesting...Reuters reports "he said a quantitative easing by the central bank would be necessary unless oil prices were to rise to $40 to $50 per barrel, which would create inflationary pressures for the economy."

Fancy that...they'll be wanting to spend their money before it goes further south. Fascinating times we're in.
ORO
(03/13/2000; 08:28:53 MDT - Msg ID: 26781)
PPT - probable intervention
PPT intervention probably at 9:45-9:50, was met with selling but absorbed most of it.

Second intervention 10:17-10:20.

Trail Guide
(03/13/2000; 08:42:55 MDT - Msg ID: 26782)
Comment
ORO,
The interventions now should be to just slow the fall, not reverse it as in the past! The same thing
is happening in the gold market. The paper players no longer have the official support behind them.
To drive the contracts to new lows today, will require the markets to separate in values. So, just
like the PPT, the US gold faction may be just managing the movement, not controlling it.
Also,
The ME is doing a very good job of managing the crude flows. This is something completely different from anything seen in the past. I believe their security in this policy is found in the Euro, trading in the background. Eventually, the oil card is going to trump our dollar economy into a slow growth mode. Yet, this will crater the equity markets because they have priced wide open growth to continue. I suspect the only growth we are in for will be major inflationary. we shall see.

TG
SM. Sporny
(03/13/2000; 08:53:58 MDT - Msg ID: 26783)
Request for Clarification
Please enlighten me, what is the PPT? Thanks.
TownCrier
(03/13/2000; 08:57:31 MDT - Msg ID: 26784)
Word from the monthly G-10 et al meeting at the BIS
http://biz.yahoo.com/rf/000313/qv.htmlIn speaking to reporters of the U.S. markets and labor situation, "Some of those things at some point could become not sustainable," adding "I think the sense around the table was that there are good reasons to hope the adjustment will be rather gradual," said chair Eddie George. And despite what we just posted from Japan, he said, "There was a recognition that an excessive rise in oil prices is not in the interest of any part of the world economy."

At any rate, notice the earlier talk of an "adjustment" as something inevitable. The only question is to whether it will be gradual or not.
TownCrier
(03/13/2000; 09:04:17 MDT - Msg ID: 26785)
Today's reserve adjustment by the Fed totaled $3.31 billion in overnight repos
Truth.
Galearis
(03/13/2000; 09:36:51 MDT - Msg ID: 26786)
(No Subject)
@ CanuckGood morning, sir Canuck. Thank you for your gracious words.

I am far from an expert on these markets, but I am stubborn and have the time to dedicate to learning more. The more I learn, the more I realize that my focus is a healthy and soon to be profitable obsession. The curious mind does profit - and not just from the material end.

My one firm recommendation during these most interesting times is to buy as much physical gold and silver as you can afford. I am not a wealthy man in the portfolio sense, but on average (given my distance from sources of supply) is to buy 50 plus troy ounces per month of silver and whatever is left over into gold and other notables.

I do not omit some attention to the "junk silver"/collectibles end either and tend to reserve a little for this end as well. I try (but do not always succeed ; ^))not to purchase true junk, but concentrate on the quality collectibles and antiques. Given that this represents a hope and a prayer that the fiancial calamities ahead will not totally remove all interest in owning this material, one can also store value/worth with the added premium of the sectors that purchase these fine things of life. I dislike the melt end for much of this material and know that down the road bull markets, like the coming explosion in silver, will create a great calamity in damage for the objet d'art.
schippi
(03/13/2000; 11:34:32 MDT - Msg ID: 26787)
Industry Indexes Vs Gold Index
http://cbs.marketwatch.com/data/dbcfiles/indindext.htx?source=htx/http2_mwThis morning the Industry Indexs tabulated at
the above URL, were ALL blood red, except for:

$GOX GOLD(CBOE) and $XAU Gold&Silver (PHLX)
The question arises:
Is this a glimse of the future?

FSAGX Hourly Chart:
http://www.SelectSectors.com/agpm70.gif
MarkeTalk
(03/13/2000; 13:22:11 MDT - Msg ID: 26788)
The End of Privacy
http://www.heise.de/tp/deutsch/special/ech/6662/1.htmlThe end of privacy, as we know it, has arrived with the CIA's latest admission that its Echelon project has been spying on our allies in Europe. Its target is economic issues, in particular, bribery. That's the official line today. What will it be tomorrow? Along with the IRS FinCen unit, which spies on US citizens to make sure all taxes are paid, such high-tech wizardry makes the case for gold all the more compelling. Gold coins tucked away from prying eyes, especially pre-1933 coins which don't have reporting requirements, make good sense.
fox
(03/13/2000; 13:39:32 MDT - Msg ID: 26789)
Harmony
what's the reason for the 8.5% increase in the hgmny stock ?
R Powell
(03/13/2000; 14:29:03 MDT - Msg ID: 26790)
SMSporny Re. PPT
You asked for clarification on PPT. I believe it is a government money pool, plunge protection taskforce(?), to provide a buying influence in free falling equities markets much like J.P. Morgan's hugh($) buying supported the market in 1907 probably preventing a crash. I'm sure ORO, T.C., T. G. and many others can give more information on how the PPT works and who controls it.
R Powell
(03/13/2000; 14:40:55 MDT - Msg ID: 26791)
Only 3.31 billion??
Sir Town Crier --Only 3.31 billion from the Fed today? I quess everyone has an off day. That's $13.24 for each of us assuming a population of 250,000,000. I'm going to spend my share while it's still worth $13.24.
Usul
(03/13/2000; 15:12:10 MDT - Msg ID: 26792)
PPT
http://www.washingtonpost.com/wp-srv/business/daily/feb/26/plunge.htmThe Washington Post explains the PPT at the link...
a.k.a. the Working Group on Financial Markets...
Did the Post coin "PPT"?
R Powell
(03/13/2000; 16:41:05 MDT - Msg ID: 26793)
Buffet, Gates and silver
I remember seeing both Mr. Buffet and Mr. Gates on T.V. last year, talking to and with college students. I was very impressed with both of them, especially their laid-back manner and the obvious fun they were having during the question/answer segement. Both stated that they are now positioned such that neither needs to worry about any financial obligations. No kidding I thought. Both also said they were going to continue working hard but only on what interested them and only that. I know Buffet bought 129 million ounces of silver during late 1997, took delivery and moved the metal to London. I also know both men are friends. I have heard rumors that Mr. Gates has sold some shares of Microsoft and bought part or all of Pan American Mining (silver mining). This last statement I'm not sure of and need help with. Can anyone offer information? Both of these men with an interest in precious metals brings to mind a balance or worthy opponent or counterweight (if you will)to those forces that have overpowered the metals in the past. If they are indeed entering these markets, their presence,if nothing else, will draw attention. TIA for any info. Usul-- thanks for the PPT link.
Phos
(03/13/2000; 16:45:47 MDT - Msg ID: 26794)
Harmony & PPT
Harmony was written up in a favourable article in Barrons today - thus the rise in the price.

Here is a PPT comment from the Longwave site which describes the function of the PPT in the fall of 1998. They saved the market in 1987. Of course, they are very busy these days too ensuring a nice gentle fall.
---------------------------
"I think that the market was unduly influenced in October by the probable intervention of the plunge protection team via Econmic Stabilization Funds buying out of the money calls on October 28. In a sense, this rigs the market, slowing the natural course of events. I sincerely believe the market plunge in October would have been far more serious, but also a lot more honest, if government (...you see those strings there...) and those beholden to it as its agents, did not tinker with the markets. I bet an audit of the 40-60 Bln in the ESF would show that little saving of the game cost about 18 Bln, some of which was recovered when the market ran up the follow months on the billion share day."
Harley Davidson
(03/13/2000; 17:11:58 MDT - Msg ID: 26795)
@R Powell
I can't answer all of what you ask but I do know that the group that manages investments for Gates bought 10% of PAAS. I think it was at around $10 per share at the time. I guess he can afford to make a mistake once in a while. Shortly after, Bill Fleckenstein (member of the board) sold a bunch of his holdings in PASS. Today they are under $4 per share.

Just recently the same group bought a large interest in Newport New Ship Building - the only ship yard that builds Aircraft Carriers in the country, I believe.



Harley Davidson
(03/13/2000; 17:33:54 MDT - Msg ID: 26796)
@R Powell, Correction -
I think that should have been Newport News Ship Building.
ORO
(03/13/2000; 18:41:32 MDT - Msg ID: 26797)
International PPT action - currency stabilization
http://members.xoom.com/_XMCM/Nebucadnezer/Currency031500.htmlThe above URL speaks for itself.

There are no free markets as most perceive them. They are controlled. In the case of currencies, trade is not settled without government intervention to sop up extra dollars.

The PPT is run by the public representatives of private banks. These banks have one tool - the currency - with which to extract tribute from us and the world. Today, the largest banks are publicly traded and owned, but their purpose is to provide favorable terms to the controlling famillies and to pull the rug from under non-cooperative competitors to these famillies' businesses.

TG - No. The public is not a participant in these decisions and the public's favor is not sought. Even if it were, the public is well outside its rights and is evidently engaged in self defeating behavior that reduces their own welfare. Even if we did have control of the gun, we are obviously shooting it at our own foot. As things stand, the gun is only partly in our hands but the aim and the trigger are in the hands of the oligarchy that Rhodes set up.

ORO
andrew the kiwi
(03/13/2000; 18:42:12 MDT - Msg ID: 26798)
gold dead in the water
http://www.quote.com/quotecom/livecharts/default.asp?symbols=gc00jjust like prada in the recent americas cup challenge successfully defended by NZ, gold is dead in the water. what we need is a strong southerly depression to get the wind into au sails. Yawn..........
R Powell
(03/13/2000; 18:55:20 MDT - Msg ID: 26799)
Market movers
Mr. Harley Davidson- thanks for the response. What I'm looking for, of course, is that event that next wakes up our gold market.? A falling DOW, a weakening dollar, a currency crisis, GATA's investigation/ allegations, inflation or return of "Big Float", oversubscription or cancellation of BOE or other central bank sales, short covering (of hedges or gold carry trade), further backing(percentagewise) of the Euro, an Asian gold backed currency, a banking crisis, or perhaps a big name investor like Buffet or Gates. What will change investor sentiment? I'm amazed that John Hathaway did make the call of producer cutbacks of hedging as a catalyst Before it happened. I know possession of physical gold is the preferred stance but I can't help but wonder what will cause the next move. Any thoughts?! Wouldn't it be nice to time it just right!
CoBra(too)
(03/13/2000; 19:00:40 MDT - Msg ID: 26800)
IMF - as it seems will be headed by another German "K"
- The difference in qualifications to manage the IMF is seemingly found in capital "K's" (Koch-Weser vs Koehler)and even "K"linton agrees to the latter! - As it seems even democratic America can't escape the (un)social democratic predominance of the EU. ... unfortunately the (god)father of "Shro(e)der" cartoons passed away, before his main hero went (pea)nuts, before hitting home - in a permanent way.
Does this mean another case of too big (of a stink)to be ignored? After all D(eutsche)B & d(resdner)bank are now too big to tank, sorry, to s(-th)ink?
Well, who knows since the C- or PPT (Crash or Plunge Protection Team) was founded as ESF (Exchange Stabilasation Fund)in 1934 and the (President's) WGFM (Working Group of Financial Markets) after the Oct. 1987 (dubbed "computer") crash.
Since I forgot my real message - except buy gold -
BUY more - now! CB2
Trail Guide
(03/13/2000; 19:06:30 MDT - Msg ID: 26801)
(No Subject)
Hello ORO,
You lost me my friend? I'm not sure what your "No!" is referring to in my post?
I understand that the official word is for them to only slow (manage?) a downward drift in the equity markets. Not save and reverse it any longer. I heard this several weeks ago. Yes? or do you still mean No?

Our posts are below.

thanks TG

---------------
Trail Guide (03/13/00; 08:42:55MDT - Msg ID:26782)
Comment
ORO,
The interventions now should be to just slow the fall, not reverse it as in the past!
-----------
ORO (03/13/00; 18:41:32MDT - Msg ID:26797)

TG - No. The public is not a participant in these decisions and the public's favor is not sought. Even if it were, the public is well outside its rights and is evidently engaged in self defeating behavior that reduces their own welfare. Even if we did have control of the gun, we are obviously shooting it at our own foot. As things stand, the gun is only partly in our hands but the aim and the trigger are in
the hands of the oligarchy that Rhodes set up.

16-penny
(03/13/2000; 19:53:14 MDT - Msg ID: 26802)
stupid questions
if there is no inflation why? is gas 2$ and congress raising the minimum wage !! also are pre 33 austrian coins exempt
lamprey_65
(03/13/2000; 20:40:29 MDT - Msg ID: 26803)
Money already flowing into "hard" assets?
Received a monthly newsletter from a coin dealer today...according to the author, they have seen quite a pick-up in orders the past few weeks. Looks like the smart money has started to transfer the paper gains to tangible assets.

Lamprey
ORO
(03/13/2000; 21:05:55 MDT - Msg ID: 26804)
TG - What No refers to
Hi good to see we are on concurrently.

The No reffers to your oft repeated implication that "society" wants fiat money. Occasionally you imply that the "powers that be" must be accepted as powerful rather than tarred feathered and thrown down the gully. So the reply is "No" to this statement.

Of course, people generally have no clue as to what money is, and just use it as long as they don't notice much damage at the personal level. Had they known that these "powers" are using the monetary system to maintain a 100 year old oligarchy in power at everyone's expense, people in the most powerful military nation would not hesitate long before throwing them out, preferably penniless.

I was hoping the statement probided enough of the context.

Comments as to PPT and currency support operations later.

I enjoy your posts at the Gold Trail greatly - though I have a few disagreements we have referred to before.

Thank you, dear friend.

PS I am busy running some numbers on the Eurodollar and Eurosterling banking system's supply and demand balances. Along the way, I found that not only hasn't the system been in balance, but dollar and pound Assets and liabilities don't balance - there are more dollar liabilities than dollar assets and that has been the state of things from the beginning of the BIS time series in 1983. I'd wager that the imbalance goes back to 1979-1980. This indicates a short squeeze on the dollar that has lasted 20 years, and that the Fed raises interest rates (thereby raising dollar demand and restricting supply) whenever the system approaches solvency and might show a positive asset/liability balance. The situation is getting way out of hand right now with a record asset/liability deficit in the global dollar banking system.

Canuck
(03/13/2000; 21:35:53 MDT - Msg ID: 26805)
@ Galearis
May your bullion collection only exceed your wisdom and your foresight.

And....may the fleas of a thousand camels infest the armpits
of the shorts.

Thank you, Galearis
tedw
(03/13/2000; 21:43:53 MDT - Msg ID: 26806)
Inflation
http://www.usagold.com
There is no inflation.

There is no inflation.

There is no inflation.

Concentrate on this dot .

There is no inflation.

You are getting sleepy.

There is no inflation
Elwood
(03/13/2000; 21:50:35 MDT - Msg ID: 26807)
Brief Word on Confiscation

Someone correct me if I'm wrong, but, way back when, didn't they define "collectible" coins as those coins with a market price that was greater than 15% over their face amount? If so, wouldn't nearly all gold coins today be classified as collectibles?

If they were to attempt to confiscate them, wouldn't they have to redefine the word "collectible" once again?

Another thing....if I sell a plot of land for 4 1-ounce Gold Eagles, is my sale price $200 (the face amount of the coins)? That would be a great relief at tax time. No bothersome capital gains stuff to worry about.

Elwood
Black Blade
(03/14/2000; 01:09:57 MDT - Msg ID: 26808)
Modern case of Gold confiscation!
Source: Mar. 3rd Weekend Journal (WSJ)A test case of gold confiscation is about to take place in the southern District of New York this month. The case will decide whether the US government (thieves) had the right to seize (steal) a valuable gold coin not intended for private ownership. The coin, a 1933 "double-eagle" was minted just prior to FDR's decision to debase the nation's currency by making private ownership of gold illegal. The 1933 gold coins were never circulated and private ownership was deemed theft.

This particular coin was once in the collection of King Farouk of Egypt, and was purchased privately in 1995 by an English coin dealer for $220,000. Secret Service agents (Gestapo) posing as coin collectors, according to court papers, seized (stole) it and arrested (harassed and intimidated) dealer Stephen Fenton at New York's Waldorf-Astoria in 1996. Mr. Fenton was attempting to sell it for $1.5 million. Criminal charges were dropped against Mr. Fenton, but he continues to seek return of the coin, now valued at $3 million. His attorney, Barry Berke of New York , says that "it's the government's burden to prove that this is unlawful" (obviously this attorney never heard of the more recent seizure and forfeiture laws).

On March 23, a federal judge (lackey) will consider a motion for dismissal, filed by Mr. Fenton's attorney last month, seeking return of the coin (good luck!). The Professional Numismatist's Guild, filing a "friend of the court" brief , argued that a decision against dismissal would have devastating effects on the rare-coin market. The government posits that because the coin was never intended for distribution, it's illegal to own. "But all the most valued coins have checkered history" says Armen Vartian, the Numismatist's Guild's attorney. In fact some of the most valuable coins such as the 1913 Liberty nickel, 1943 bronze cent and 1804 silver dollar (one which sold for $4.1 million in New York last September) were minted by the US but never released to the public.
View Yesterday's Discussion.

SteveH
(03/14/2000; 01:42:39 MDT - Msg ID: 26809)
Oil
www.gold-eagle.coma letter to my friend Leroy:

Leroy,

The below is a repost from the www.gold-eagle.com website. Here, it would seem is another reference for the amount of oil remaining in the world. It would seem that 80-years exists in the Middle East but 20-years elsewhere. This would explain the principle of the swing share and why it is increasing. In order for all oil supplies to last for 80-years, consumption must remain the same and the swing share must continue to rise so that those with 20-years can stretch their supply to 80 years. At some point, the swing share will make the Middle East an even more critical locale, since more and more of the oil will be derived from there. In, 2008, over 50% of the oil production will come from the Middle East. In 1973, the swing share was in the mid to high 30's, just where it is at now. As you recall, the North Sea oil discoveries were just about to come on line. At this point in time, there are per some experts no further major discoveries to be had that would rival the North Sea productions capability that can or will dampen the swing share increase of supply from the Middle East. Therefore, we can conclude that our dependence on ME oil will only increase and so will our price for same.

Let me put this an another perspective. In less than 80-years the world will run out of oil. Since the world revolves around oil, the world as we know it today will have to find an alternative to oil or cease to function. Eighty-years is the same time from 1920 until now -- the time of the industrial revolution. In order to stretch supplies, new sources of oil (95% of the world has supposedly been explored) need be found or developed, alternative energy sources need be used, and production of existing reserves needs to be slowed. In order to slow production, with demand high and increasing by 1.8% per year, price hikes or increases seem to be a fruitful course of conservation: If the oil costs more, then people will not be able to afford as much thus lengthening the years of production. Food for thought.

SteveH

(note: swing share is the share of oil provided by the Middle East)

@ Pete
(Whacked) Mar 14, 01:22

http://www.opec.org/faqs.htm#b1 FAQ. Is the world running out of oil? Oil is a limited resource, so it may eventually run out, although not for many years to come. OPEC's oil reserves are sufficient to last another 80 years at the current rate of production, while non-OPEC oil producers' reserves might last less than 20 years. The worldwide demand for oil is rising and OPEC is expected to be an increasingly important source of that oil. If we manage our resources well, use the oil efficiently and develop new fields, then our oil reserves should last for many more generations to come.

On Oil, then......
(pete) Mar 14, 00:43

Article says that likely no end of shortage in sight. Way I read it was that OPEC needs to produce 21 to 22 million barrels per day to satify the demand. They have been producing 19 and have a capacity to produce 23 if they can run at 100%. That is not a possibility even if they wanted to do so. Too much up front work on old wells was postponed during the lean times and it will take several yrs. to get that done. In the mean time, peaks will have been reached in Non-OPEC well fields and total production will remain static or fall for the remainder of the decade. Only hope for lower prices is a reduction in demand beginning NOW. Better read this yourself. I am printing only as I recall it from a quick read. Non the less, I don't expect a fall in price and that has to be good for gold as the word gets out. Hope this connects. It is a must read. Dated today!

HI - HAT
(03/14/2000; 02:14:58 MDT - Msg ID: 26810)
MISSION ALMOST GETTING IMPOSIBLE
Our mission should we all decide to accept it is to keep as calm a hand on the golden tiller as we can while we all whitewater in the dark towards the Niagara Falls rumbling straight ahead. Scarey, very scarey.
SteveH
(03/14/2000; 02:29:45 MDT - Msg ID: 26811)
US v Cruishank
A most important case, can you tell why?

"...We have in our political system a government of the United States and a government of each of the several States. Each one of these governments is distinct from the others, and each has citizens of its own who owe it allegiance, and whose rights, within its jurisdiction, it must protect. The same person may be at the same time a citizen of the United States and a citizen of a State, but his rights of citizenship under one of these governments will be different from those he has under the other. Slaughter- House Cases, 16 Wall. 74.

"Citizens are the members of the political community to which they belong. They are the people who compose the community, and who, in their associated capacity, have established or submitted themselves to the dominion of a government for the promotion of their general welfare and the protection of their individual as well as their collective rights. In the formation of a government, the people may confer upon it such powers as they choose. The government, when so formed, may, and when called upon should, exercise all the powers it has for the protection of the rights of its citizens and the people within its jurisdiction; but it can exercise no other. The duty of a government to afford protection is limited always by the power it possesses for that purpose.

"Experience made the fact known to the people of the United States that they required a national government for national purposes. The separate governments of the separate States, bound together by the articles of confederation alone, were not sufficient for the promotion of the general welfare of the people in respect to foreign nations, or for their complete protection as citizens of the confederated States. For this reason, the people of the United States, 'in order to form a more perfect union, establish justice, insure domestic tranquillity, provide for [92 U.S. 542, 550] the common defence, promote the general welfare, and secure the blessings of liberty' to themselves and their posterity (Const. Preamble), ordained and established the government of the United States, and defined its powers by a constitution, which they adopted as its fundamental law, and made its rule of action.

"The government thus established and defined is to some extent a government of the States in their political capacity. It is also, for certain purposes, a government of the pepole. Its powers are limited in number, but not in degree. Within the scope of its powers, as enumerated and defined, it is supreme and above the States; but beyond, it has no existence. It was erected for special purposes, and endowed with all the powers necessary for its own preservation and the accomplishment of the ends its people had in view. It can neither grant nor secure to its citizens any right or privilege not expressly or by implication placed under its jurisdiction.

"The people of the United States resident within any State are subject to two governments: one State, and the other National; but there need be no conflict between the two. The powers which one possesses, the other does not. They are established for different purposes, and have separate jurisdictions. Together they make one whole, and furnish the people of the United States with a complete government, ample for the protection of all their rights at home and abroad. True, it may sometimes happen that a person is amenable to both jurisdictions for one and the same act. Thus, if a marshal of the United States is unlawfully resisted while executing the process of the courts within a State, and the resistance is accompanied by an assault on the officer, the sovereignty of the United States is violated by the resistance, and that of the State by the breach of peace, in the assault. So, too, if one passes counterfeited coin of the United States within a State, it may be an offence against the United States and the State: the United States, because it discredits the coin; and the State, because of the fraud upon him to whom it is passed. This does not, however, necessarily imply that the two governments possess powers in common, or bring them into conflict with each other. It is the natural consequence of a citizenship [92 U.S. 542, 551] which owes allegiance to two sovereignties, and claims protection from both. The citizen cannot complain, because he has voluntarily submitted himself to such a form of government. He owes allegiance to the two departments, so to speak, and within their respective spheres must pay the penalties which each exacts for disobedience to its laws. In return, he can demand protection from each within its own jurisdiction.

"The government of the United States is one of delegated powers alone. Its authority is defined and limited by the Constitution. All powers not granted to it by that instrument are reserved to the States or the people. No rights can be acquired under the constitution or laws of the United States, except such as the government of the United States has the authority to grant or secure. All that cannot be so granted or secured are left under the protection of the States...."

Black Blade
(03/14/2000; 02:36:00 MDT - Msg ID: 26812)
Oil? hmmmm...........
An interesting thought though. I wonder if this 80 year time frame accounts for a number of alternate possibilities:

1) Much of the known and unexplored regions of possible petroleum sources are off-limits. Some areas such as off the California coast, North slope of Alaska, Montana Rocky Mountain Range Front, and The recently formed Escalante Staircase National Monument (truly a barren desert).

2) The Athabasca tar sands in western Canada (approximately 600 bbl of contained oil), currently mined on a relatively small scale but looking more profitable under current prices.

3) The oil shale deposits of eastern Utah/western Colorado. Explored for a time in the 1970's when the OPEC embargo created high prices. This too looks more interesting.

4) More use of natural gas and natural gas distillates as alternative energy sources.

5) Biomass methane and synthetic fuels looks more promising. Even ethanol from the corn belt begins to look more like a possibility.

Of course, these are just a few possibilities and only looking at the northern half of the western hemisphere. Not to mention that more petroleum is extracted from greater depths in the Gulf Coast and newer discovered "sub-salt" plays. Then again, if the gubbermint would cut petroleum taxes instead of whining about rising oil prices, this problem wouldn't likely become so acute. Anyway just a few rambling thoughts.


Black Blade
(03/14/2000; 03:28:45 MDT - Msg ID: 26813)
Russia to keep more Au off market, Manipulators get bolder!
Source: Bridge newsRussia's Sberbank says to increase purchases from gold producers

Moscow--Mar 13--The state-controlled savings bank Sberbank, Russia's largest in terms of registered capital and controlled assets, plans to increase purchases of gold from producers this year, an official with the bank said Monday. He also said Sberbank had sold over 5.5 tonnes of gold to the Central Bank of Russia since the start of the year. (Story .17753)

Black Blade: But still no PGM's, because they don't have any!

Morgan Stanley, Goldman seek NYMEX role in online trade deal

New York--Mar 13--Morgan Stanley Dean Witter and Goldman Sachs have approached the New York Mercantile Exchange about participating in an electronic commodity trading venture that they are creating, a Morgan Stanley spokeswoman said. The firms plan a presentation to the NYMEX board at 1600 ET about the venture, which would initially focus on energy and precious metals. However, sources said the exchange is weighing several online trading options and no deals are imminent. (Story .20199)

Black Blade: Now this is a scary prospect! These guys want to play in electronic online commodity trades? Can you say MANIPULATION? I knew you could.
The Believer
(03/14/2000; 05:45:32 MDT - Msg ID: 26814)
SteveH- Oil
http://www.hubbertpeak.com/campbell/commons.htm Steve,
Here is a very good report on the future of oil.
scp
(03/14/2000; 06:36:08 MDT - Msg ID: 26815)
Gold ready to break-out?
http://www.sandspring.com/charts/cdj0314gold.htmlInteresting piece from Sand Spring.
http://www.sandspring.com/charts/cdj0314gold.html
ss of nep
(03/14/2000; 07:12:07 MDT - Msg ID: 26816)
future CONFISCATION

- - all that is needed is a fabricated crisis - - -
- - and then you can kiss it all bye bye - - -



The strategem of Executive Order allows the President of the United States to unilaterally create law without congressional oversight and approval Thirty days after signing an Executive Order, the order becomes the law of the land with the same force and permanence of any bill signed into law in the usual manner.

Col. James Ammerman (40 years as Army Chaplain) presented a talk to The Granada Forum (in southern California) on March 20, 1997. In this lecture, he outlined the details of Executive Orders 10995-11005 as follows:
1. Executive Order #10995: Authorizes seizure of all communication equiptment in the United States.
2. Executive Order #10997: Authorizes seizure of all electric power companies, fuels, fuel sources, and minerals (public and private)
3. Executive Order #10998: Authorizes seizure of all food supplies, food resources, all farms and all farm equiptment (public and private).
4. Executive Order #10999: Authorizes seizure of all means of transportation- including personal cars, trucks, or any type of vehicle; Total control over all highways, roads, seaports, and seaways.
5. Executive Order #11000: Authorizes forced conscription of all Americans for work duties under supervision of Federal agents. This section also authorizes the splitting up of family units if deemed necessary by the government agencies in charge.
6. Executive Order #11001: Authorizes seizure of all health, education, and welfare facilities and their administrations (public and pivate).
7. Executive Order #11002: Empowers the Post Master General to register all men, women, and children in the United States for government purposes.
8. Executive Order #11003: Authorizes seizure of all airports and all aircraft, public, commercial, and private.
9. Executive Order #11004: Authorizes seizure of all housing and finance authorities and permits government agents to establish forced relocation sites. The government can declare any area of its choosing as "unsafe" and force the entire area to be abandoned of all persons. Authorizes establishment of new "relocation" communities; building new housing with public funds.
10. Executive Order #11005: Authorizes seizure of all railroads, inland waterways, and storage facilities, both public and private.
11. Executive Order #13010 (New): This Executive order is entitled Critical Infrastructure Protection. It established a commission made up of members from Federal government departments and agencies which will have greater powers than any body of officials in the history of the United States when an emergency is declared. This commission includes the heads of:
1. The Department of the Treasury
2. The Department of Justice
3. The Department of Defense
4. The Department of Commerce
5. The Department opf Transportation
6. The Department of Energy
7. The CIA
8. The FBI
9. FEMA




Henri
(03/14/2000; 07:39:41 MDT - Msg ID: 26817)
Andrew the Kiwi
Congrats on the kiwi's successful defense again of the America's Cup (again). The NYYC must be livid. As for the slack in the sails of gold, just think of it as the calm before the storm...or a buying opportunity. I for one sincerely hope that the POPG (price of Paper Gold) remains linked to the POG and takes another downturn so I can exchange my sheckles for more gold than I would have been able to at these prices.
Henri
(03/14/2000; 08:22:58 MDT - Msg ID: 26818)
ss of nep Msg 26816
ss of nep
"The strategem of Executive Order allows the President of the United States to unilaterally create law without congressional oversight and approval Thirty days after signing an Executive Order, the order becomes the law of the land with the same force and permanence of any bill signed into law in the usual manner."

Henri
If it has become law of the "land" does that make it law of the sovereign citizens as well? How is this type of power granted? By congress? As described in the Constitutional Amendments 9
"The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people"
and Amendment 10
"The powers not delegated to the United States by the Constitution nor prohibited by it to the States, are reserved to the States respectively, or to the people"

The 9th and 10th Amendents have been interpreted by congress to be "...the rights of citizens...[](D)against unconstitutional exercise of authority..." (The Firearms owners Protection Act of 1986)

So my question is...How have the restrictions of the powers of the US government under the Constitution been bypassed so as to allow such broad sweeping powers to be given force of law?

By what maze of constitutional lawmaking can such orders be imposed? If these bypasses were the act of congress, then they are clearly unconstitutional since congress has no power to bestow such power or enact legislation enabling such power.

Anyone have a handle on this?

USAGOLD
(03/14/2000; 08:28:36 MDT - Msg ID: 26819)
Today's Gold Report: Panic Trade in Oil Futures, Inflation Expectations Push Gold Demand
3/14/00 Indications
�Current
�Change
Gold
288.90
-1.40
Silver
5.14
+.03
Gold Lease Rate 1mo
0.4675%
+0.0637
Gold Comex Stocks
1,437,004
nc


Market Report (3/14/00): Gold is down in early New York trading after a
quiet night overseas. Physical buying by private investors and fund short
covering continues on the dips. Bridge News reports Australian producer
buying in the Tokyo market. For the most part, we are off to a relatively
quiet start with little in the way of news save the rising gasoline prices
and inflation expectations well-publicized by the mainstream media.

Oil went over $34 per barrel yesterday as the trend to higher energy prices
continued unabated. OPEC meets at the end of the month to decide whether or
not it will extend the production cuts which have led to a tripling in the
oil price over the last year. Speculation over which direction OPEC will go
"fueled near panic trade in New York energy futures" yesterday.

Private gold investors are reacting to a growing concern that inflation has
returned to the financial landscape and that the Clinton government might be
covering up the full effect of higher oil prices on the rest of the economy
through the release of false inflation numbers. One must keep in mind that
this is an election year and a surge in inflation is an inconvenience the
Gore campaign will not welcome. As far as international investors are
concerned higher inflation numbers could have a deleterious effect on the
dollar, thus the foreign interest in gold. This week both PPI and CPI will be
announced. That will be followed by the Fed Open Market Committee on Monday.
Yesterday, Alan Greenspan again warned of higher interest rates in the
future.

One London trader described the overnight gold market this way: "People are
also waiting for some clue on U.S. interest rates from the next FOMC meeting.
The physical demand overnight was rather less significant than in the
previous few days and didn't provide the necessary support to trade over
$290.00." That support might be forthcoming as the week and month progress.

That's it for today, fellow goldmeisters. We'll see you here tomorrow.

If you are looking for a pro-gold view of the various financial markets as
well as a summary of the events affecting the yellow metal, our monthly
newsletter might be of interest. News & Views -- Forecasts, Commentary
& Analysis on the Economy and Precious Metals has been characterized
as witty, urbane, intelligent and down-to-earth. Not to mention it's Free of
Charge If you want to keep up with gold, this is the way a large segment of
the gold owning public does it, and has done it for over a decade.

Just click here ---> ORDER FORM <--- and make the appropriate entries.
RossL
(03/14/2000; 08:31:10 MDT - Msg ID: 26820)
Executive Orders
ss of nep, Henri
The question remains: if the president would fabricate a crisis and implement these orders, would the sheeple go along with it, or would it start a revolution?

If the president called for gold confiscation, would anybody turn in their coins?
Journeyman
(03/14/2000; 08:37:46 MDT - Msg ID: 26821)
Greenspan on government's contribution to America's "hi-tech" revolution

"I think that what has been really quite remarkable in this country
is our ability to create a level of technology which is the envy of the rest of the world, and we have done it basically not so much from tax subsidies or subsidies from government but essentially from having an entreprenure based system in which people could see very large rewards from successful endeavours. And I can't say I know very much about the impact of the credit on what is going on in silicon valley as such, but I'm reasonably well certain that the vast, vast proportion of the success that our high tech industry has created has got nothing to do with government." -Alan Greenspan, Humphrey-Hawkins to Senate Banking Committee, Feb. 23, 2000

Regards,
Journeyman
Leland
(03/14/2000; 08:46:46 MDT - Msg ID: 26822)
The Price of Oil to Test us Again

There are two things to remember about oil.
One, change yours every 3,000 miles; and
two, most of what you read about it is wrong.

In the 1970s, we read constantly that the Earth's oil supply was being
used up. We read that OPEC, the cartel of oil-producing nations, had
us over a barrel, and that the price of that barrel was destined to rise,
inexorably, until we all froze, or rode bicycles, or both.

And we read that oil prices were a leading cause of inflation. That
seemed to make sense: Not only were we dependent on petroleum
products to run our cars, heat our homes, and power our lights, but oil
also turned up in everything from nylon to cellophane. Crude ran
through all of modern industry; any change in prices would naturally
ripple across the economy.

The predictions of $100-a-barrel oil eventually proved false, but not
before tens of billions of dollars had been spent on oil-shale-extraction
plants, nuclear-power generators, and solar-geo-biothermal energy
projects of various kinds, few of which ever proved economically
useful. And not before billions more were tossed away on loans to
petroleum-rich countries for massive development projects that later
went bust.

The root of all inflation?

Oil-price fever also found its way into many popular economic ideas of
that era. Remember President Gerald Ford promoting those quaint
lapel pins that said "Whip Inflation Now"? Or President Jimmy Carter
declaring "the moral equivalent of war" (later satirized by its acronym:
MEOW)? Or the many pious warnings that America had better
eliminate imported oil altogether?

Some things had become clearer by the end of the 1980s. There was
more oil in the earth than we thought; almost every time somebody
punched a hole in the ground the amount of proven reserves went up.
The OPEC nations didn't run the world; countries such as Iran and Iraq
were as likely to go to war with each other as to collude on petroleum
prices.

And inflation, it turned out, was connected to oil prices only indirectly.
Yes, many different industries felt it when a barrel of crude went from
$2.50 to $35. And tripling prices at the gas pump knocked the wind
out of American consumers like nothing had since the Great
Depression. But it was the Federal Reserve, not OPEC, which today
gets the blame for the wage-price spiral of those years.

The Fed actually began maintaining an easy-credit policy in the 1960s,
to accommodate President Lyndon Johnson's simultaneous pursuit of
both the Great Society and the Vietnam War. Corporate America,
organized labor, and consumers in general were expecting substantial
yearly wage and price hikes even before OPEC turned hostile. Oil just
magnified the numbers.

Self-fulfilling prophecies

"The real [inflation] problem was monetary policy, and the policies we
had adopted in the late '60s," Richard Berner, a Morgan Stanley
economist, said yesterday. It took a new Fed chairman - Paul Volcker
- a much tougher attitude, and a nasty recession to finally break the
spiral from 1979 to 1981.

Since then, it's become gospel that the Fed will do whatever it takes to
prevent inflation from rising up again. That belief acts like a self-fulfilling
prophecy, checking the impulse to demand big wage or price hikes,
and encouraging both companies and workers to stretch for higher
productivity instead. Real gains in income and living standards, as
opposed to the inflationary kind, are the payoff.

But all of that is about to be tested again. Oil supplies are low, thanks
to recently depressed prices; and demand is up from a recovering
world economy. Consumers could easily see $2-plus-a-gallon gasoline
at the pumps before midsummer.

Will our expectations for inflation rise too, and will they be
self-fulfilling? Those could be the real questions.

[Fair Use for Educational/Research Purposes Only, and
Thanks to Andrew Cassel, PHILADELPHIA INQUIRER]
RossL
(03/14/2000; 08:47:41 MDT - Msg ID: 26823)
Chart of the Week
http://www.investech.com/
The chart of the week at James Stack's Investech shows the NASDAQ P/E maintaining it's trajectory.

In his commentary, he questions what will happen if there is a CPI/PPI surprise this week. Silly! The current administration will not allow any surprises in the numbers!!!
Henri
(03/14/2000; 08:47:58 MDT - Msg ID: 26824)
Free gold
No, I'm not giving it away. Would that I could. I present a case for free gold in the sense that it not be construed as "property" subject to seizure by lawful or unlawful means. If gold is not "owned" as property but merely transferred between parties by mutual agreement as a "free" medium of exchange for goods or settlements of personal or familial inequity,and not the settlement for exchanges of an unlawful transaction, then such transactions should not be nay can not be subject to taxation by any entity. This is so since such taxation would be an infringement upon the sanctity of private (not commercial)transactions. That person having custody of the metal not being considered the owner but merely the user. That gold be considered a store of value retained against adversity in the same way as a squirrel would store nuts for the winter, is in and of itself a fundamental right of mankind similar to those given creedence by the Constitution and should be considered as a God given right retained by the people. This right cannot as such be infringed since it is protected in this country by the 4th Amendment
"The right of the people to be secure in their persons, houses, papers, and effects [gold], against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized."
MarkeTalk
(03/14/2000; 10:52:10 MDT - Msg ID: 26825)
Swiss gold sale
Today's weakness in gold may be reflecting the Swiss gold coming onto the market. Isn't today (or was it yesterday) when a decision was going to be made regarding the disposition of the 1300 tons of Swiss gold? If memory serves me correctly, after the people voted last year against selling the gold, I had heard there was a six-month period, after which the sale would be approved provided there was no objections. Can anyone verify this? Town Crier? Aristotle?
Leland
(03/14/2000; 11:56:49 MDT - Msg ID: 26826)
Reading Between These Lines, OPEC Will NOT Increase Production
As industrialized nations worry
that soaring oil prices will spark inflation, OPEC members will
see a 59 percent in their oil export earnings this year, to $211.5
billion, the U.S. Energy Department said Thursday.

The increase in prices, which have tripled in the last year, is
due mostly to OPEC's decision to take some 4.3 million barrels
of oil a day off the world market amid strong world demand for
oil.

As a result, oil revenues for the 11-member cartel have more
than doubled in the last two years and are now the highest
since 1984, according the department's Energy Information
Administration.

Saudi Arabia, the biggest U.S. oil supplier and provider of 28
percent of OPEC's crude production, will see its oil revenues
increase 55 percent to $60 billion, the EIA said.

"The sharp increase in oil prices over the past year has
significantly improved Saudi Arabia's economic situation, with
5.4 percent real GDP (gross domestic product) growth forecast
for 2000," the EIA said.

The economic outlook, government budgets and trade balances
of the other OPEC members have improved as well.

Higher oil prices are also benefiting other major oil producing
nations such as Russia and Mexico, the EIA said. Both
countries depend heavily on oil export earnings to fund
government programs.

For the United States, high prices should end the decline in
domestic oil production. U.S. production should level off at
around 5.9 million barrels per day this year and in 2001, the
EIA said. U.S. oil production last year was the lowest in half a
century.

However, soaring oil prices could dramatically increase the
cost of U.S. oil imports to as much as $90 billion this year, up
from $50 billion in 1997, according to the agency.

"Higher oil prices also are having a macroeconomic impact on
the United States, including evidence of increased inflation," the
EIA said.

The following is the agency's projections for OPEC export
revenues (in billions of dollars):

Country 1999 2000 Change

Algeria $6.5 $10.1 56%

Indonesia $3.7 $5.6 52%

Iran $13.9 $21.9 58%

Iraq $11.4 $20.4 79%

Kuwait $10.0 $16.2 62%

Libya $7.4 $11.7 59%

Nigeria $12.0 $18.5 54%

Qatar $4.1 $6.6 61%

Saudi Arabia $38.3 $59.6 55%

UAE $11.9 $19.1 60%

Venezuela $13.6 $21.8 60%

Total OPEC $132.8 $211.5 59%

[Fair Use for Educational/Research Purposes Only,
and Thanks to Tom Doggett, REUTERS]
Henri
(03/14/2000; 12:55:46 MDT - Msg ID: 26827)
Philharmonics
Does anyone know offhand whether the Austrian Phils are 1 oz or 1 troy once of fine gold?
TownCrier
(03/14/2000; 13:16:38 MDT - Msg ID: 26828)
Sir Henri, when speaking of gold, the "troy" element almost always goes without saying
http://www.usagold.com/productspage.htmlYes. They are troy ounces. That is, 31.103 grams are in each troy ounce...heavier than the 28.349 grams contained in each standard avoirdupois ounce--that with which we weigh common things.
Cavan Man
(03/14/2000; 13:33:30 MDT - Msg ID: 26829)
Dow & NASDQ Indices
I don't know a darn thing about charting. Just from paying attention it looks to me like the DOW just does not bounce back the way it has for the last two years after exhibiting weakness on any particular day. The other index is starting to appear to me like it has topped out.
onlychild
(03/14/2000; 13:37:55 MDT - Msg ID: 26830)
Executive orders re: msg 26816
http://www.nara.gov/fedreg/eos/e12656.htmlThe power of Executive order is granted by Section 301, Title 3 of the United States Code. It's kind of scary. EO10995 through EO11005 (JFK) were revoked by EO12656. This new Executive order combined all of the provisions of the old ones and then some. Note the date it was signed: Nov. 18, 1988. Wasn't Ronnie a lame duck by then? Did he think that his partner in crime (George B.) might need these powers? If some of what we've read about the Bush family's involvement in the Gulf is true, then the stirrings of war may have already spooked our next President. What better way to gain power than to have the old guy sign laws that you might need? Then if anyone figures it out, blame it on him. By the way, EO12656 has not been revoked or superceeded.
lamprey_65
(03/14/2000; 14:26:45 MDT - Msg ID: 26831)
Executive Orders Site
http://www.pub.whitehouse.gov/search/executive-orders.htmlCheck this site to search EO's....very illuminating. You don't have to enter a keyword in the search.

Beowulf
(03/14/2000; 15:00:31 MDT - Msg ID: 26832)
Interesting Day
Of the major gold companies Newmont (NEM) looks like it was the only one to finish up today. I find it ironic that Mr. "It's the economy stupid" Clinton ends up making a statement that tanks the Biotech sector today. What a dumbass remark about letting everyone have the Genome information. Some of these companies are funding their research with investor money and Clinton comes out and says he wants to take their research away and let the whole world have access to what they have paid for. Does that sound like confiscation?

Last month when when the DOW had problems people fled the Old economy stocks for the Biotech and NASDAQ tech stocks. Where do you run to put your money when those "Safe Haven Tech Stocks" (as the folks on CNBC would say) start to tank? A lot would run to mining and gold stocks but as I saw today the cabal are really clever. If you tank the POG while the rest of the sectors are falling, and the mining stocks start falling also then you certainly don't want to put it there so you head for the Bonds. Good trick, these guys are good.

I guess the "Ides of March" saying is true. Glad I own physical! Get you some and you'll be able to sleep at night and you wont care what the market is doing.
fox
(03/14/2000; 15:02:28 MDT - Msg ID: 26833)
@ Phos
thank you for the response
Beowulf
(03/14/2000; 15:08:00 MDT - Msg ID: 26834)
OFF TOPIC
I was listening to Click and Clack the Car Talk gurus on my radio at work today and they mentioned that BUTT is an actual unit of measurment. When people say "you look like your carrying a buttload of weight on your back" they actually are refering to a know unit of measurement, The BUTT. Websters dictionary says BUTT is 108 British gallons, or 129.7 US gallons. Look it up yourself, it's true. :)

I'm going to get me a buttload of gold one of these day. Yeah baby!!
CoBra(too)
(03/14/2000; 16:13:43 MDT - Msg ID: 26835)
NWO - as perceived from the (mis-ad-)vantage point of a proxy paria!
In a political correct global village the personal liberty and freedom in a democracy is rapidly becoming - or deteriorating - to a modern euphimism of majority tyranny of
economic oligarchy, accentuated by historical precedents as tactical weapons. The arsenals of warfare are further supplemented by organisations as WTO, IMF, World Bank, all sorts of development banks, and maybe I should also mention
UN, OSCE, and any so called NGO's-which may sound heretic- and have only one goal - economic supremacy at ANY cost.

In all reality, as some of you on this forum bemoan the gradual retreat of the US Constitution, by re- or mis- interpreters of your main amendements, which undoubtedly are in in grave jeopardy; I, as an Austrian feel as being as being a similar proxy and in the middle of a new sceptical view of the EU, which basically means the ancient, historical fears and differences of the "Grande Nation" vs Germany are surfacing again. So much for the future of the Euro - as the EU is aiming for a relative majority, instead of a equal member vote. - GO GOLD - it can't be manipulated forever!

As we approach the crossroads between the "old" economy to the "new age", in post modern, post industrial, though virtual (mis-) information societies ... I only would wonder
who's going to feed, shelter and transport the people and the goods to support their basic (or is it virtual) needs?

"Stellvertrer Krieg" (proxy) on the back of e smallest may sum it up - regards CB2
Beowulf
(03/14/2000; 16:30:49 MDT - Msg ID: 26836)
API reports unexpected draws in crude, gasoline
http://biz.yahoo.com/rf/000314/bfc.htmlHears a good read on oil curent oil reserves, and the market outlook.
Netking
(03/14/2000; 17:03:08 MDT - Msg ID: 26837)
Golden outlook from Dr Kaplan
Dr Kaplan writes today; . . .
SUMMARY: My current outlook has been raised to STRONGLY BULLISH for gold and its shares. Repeated attempts to trigger a selloff by
hitting long speculator positions have not succeeded, while the XAU, an important leading indicator for gold shares, has been steadily
outperforming the yellow metal itself and is forming a bullish cross in slow stochastics at low levels. A number of gold mining shares have
repeatedly retested recent lows and have encountered very strong resistance, often accompanied by block purchases. There exists a race
condition between crude oil and the U.S. dollar, both of which have varying degrees of technical weakness and very strong bullish sentiment, to
see which might collapse first. Recently the dollar has been weakening more noticeably than the price of crude, probably responding to a
pullback in speculative U.S. equities. Moreover, gold is responding more strongly to dollar movement than to crude oil, though both remain
important. Commodities indices are also rallying.
CoBra(too)
(03/14/2000; 17:10:06 MDT - Msg ID: 26838)
@MK
Sir Michael - re. Brown Palace - when-ever I get back to your great town - someone told me it's the 'midway' new airport between Tokyo and ??? Munich! - it's going to be on me - as I owe you so much for your generosity of your great website and forum - DANKE _CB2

PS: In Jan. 1988 (see Denver Post) the 20th intl. Stock Exchange Skiing competition took place in Aspen ( 850 participants from 33 Exchanges) - Lefty Lewis (Lewis, Gavin, NYSE floor brokers) wanted to outdo CB2 at the 19th. event in Bad Gastein, the old Emperor's summer spa - now winterized) - we decided to call it "FUN" ...




dragonfly
(03/14/2000; 17:10:34 MDT - Msg ID: 26839)
Go Idaho
http://www.worldnetdaily.com/bluesky_dougherty/20000314_xnjdo_idaho_to_b.shtmlGuns, Gold, Grain and Guts. (not necessarily in that order)

Must be something in the air.
Harley Davidson
(03/14/2000; 17:36:06 MDT - Msg ID: 26840)
@R Powell, in your Msg ID:26799 you said...
"Wouldn't it be nice to time it just right!"

Yes, quite right but also quite impossible. Since I have no way of knowing with absolute certainty when the best time will be, I remain content to acquire as much gold as is practical on a regular basis. That seems to me to be the only way of being assured that after gold has broken loose, I will know I was in on the ground floor i.e. in retrospect.

Bonedaddy
(03/14/2000; 18:11:34 MDT - Msg ID: 26841)
Idaho
Those are some damn good Americans!
HI - HAT
(03/14/2000; 18:47:21 MDT - Msg ID: 26842)
ss of neo 26816 DICTATORAE
Thankyou for the public service in posting these Executive Orders. To me it is only a matter of some small time before the mismanagement or mis-steps of our ruling Oligarchy bring on the crises that will precipitate the calamity of these orders being visitated upon us. If it happens it will mean that the dictatorship we live under now, will be merely formalized. We may even get to see our very own Caesar cross the Potomac, and then think, of what a relief it will be to know our future. Of course there may yet arise a moment of national clarity and all those actively undermining our lawful, constituted, Republic, are sought out and declared to be what they are, PUBLIC ENEMIES
andrew the kiwi
(03/14/2000; 19:13:26 MDT - Msg ID: 26843)
the stuff that shines
Henriwith your words of encouragement i went out and purchased a few more half sovereigns and sovereigns, to compliment my stash of sovereigns, halves and maples.

silver in NZ is unobtainable in coin form, i can purchase 1kg bars(approx 32 oz i believe) at the spot price. i would love to own silver maples(100 will do) but i believe the premium for these over spot is excessive, as well as being unavailable down under.

the wise men built his house upon THE ROCK !
Elwood
(03/14/2000; 19:26:19 MDT - Msg ID: 26844)
Food for Thought

Anyone notice the yield curve slipped further today?
Leland
(03/14/2000; 20:51:26 MDT - Msg ID: 26845)
Clif Droke on "The New Economy" (I Hope That You Enjoy)
http://www.gold-eagle.com/gold_digest_00/droke031600.html.
Solomon Weaver
(03/14/2000; 21:11:52 MDT - Msg ID: 26846)
Some thoughts and a link
http://www.gold-eagle.com/gold_digest_00/chapman030100.htmlLIVING IN THE DERIVATIVE WORLD

I remember a comment by Another which stated that dollars (cash) was a "derivative"....at first I was confused..but over time...I started to understand.

Money "derives" its value from what it can move.

Anyone, with half a sense for history and culture, who sits down and ponders the most recent few hundred years of mankind's developments, comes to the dizzying realization that we have developed a massively new epoch in the total history of our species...in the last 300 years we have truely tasted the fruits from the tree of knowledge..and on some levels have indigestion.

The primary common denominator to our survival is knowledge (and its partner, wisdom).

Until about 120 years ago, oil was not very valuable...but the more we discovered how to "burn" it and how to "form" it (chemicals, plastics), the more valuable it became.

Like others here at the forum, I think that gold and silver are due for a return to hard asset category, and given their lackluster performance in the last 15 years, in a time with immense economic progress, can only enjoy a solid recovery (both in price and popularity).

On the other hand, I think we all have to consider that (all paradigms aside) humanity has entered into a world where the physical survival of 50% of our population requires the continuing functioning of a very complex set of physical and economic flows. These folks live in a derivative world. Milk is in cartons. Heat comes in over wires. Wheat arrives baked.

We see the rumblings of reemergent hardliners in China and Russia and the "idea" of future wars is discussed....The problem with this is that with so much of our ability to create wealth tied to knowledge (techknowledge), invasion of the rich no longer generate the spoils they did before. I think that if we are honest, we will recognize that the extended use of emergency executive orders by the President would accomplish the same thing as having America invaded.

Would any President really want to be the one to do this? When Roosevelt called the bank holiday in the 30's and conficated gold, does anyone think he wanted this???? He was a decisive man, stepping into a new office where he realized we needed some real bitter medicine. Gold was targeted because it was the "accepted" place for people of all nations to "park their wealth" in pockets "outside of the formal banking system". Back then, there was no highspeed digital money, and a large portion of money was cash....today, when you move money it goes from "your bank" to "counterparties bank". It is almost a pure derivative money. Even if gold were to rise in value such that it could be valued close to the same as today's fiat pool, most of us would die quickly if the digital fiat system did not work.

We look at the divergent paths of gold metal vs. gold paper. When gold paper becomes worthless, gold metal will have value because it holds inherant credibility. But given its very scarcity, that gold metal will need "another currency" to move its value into in order to transact purchases. In a dollar crisis in a digital world, there is really nothing to gain by "confiscating gold"....the primary concern should be to keep the "remnant of the dollar economy" stabile enough that "gold will flow back into it". Perhaps I am naive to believe that our leaders will understand this...if they don't then they are not only fools they are derivatives of fools. I like to hope that this might be one of the reasons why the very intellectually astute monetary mind of Mr. Greenspan decided to stay in power...I think he may be one of the few who understand the problems of foolishness (particularly when viewed in the magic mirror made of gold).

Poor old Solomon
Magician
(03/15/2000; 01:21:14 MDT - Msg ID: 26847)
Care to leap the chasm this week?
Well folks, looks like we're looking down from the spiral dizzying heights of the final economic precipice from the second and more vast and overarching Corporatization during the 20th century. As a market system, a vast sophistication has emerged with the use of theoretical and software models, as well as networked trading systems. These advancements have allowed the markets' changes to be leveraged to some degree of success while providing huge amounts of cash to put into equities, fueling a runaway stock market.

The other degrees left over in the derivatives industry are not so successful for overall market stability. It serves no purpose lamenting the effects of market leverage. As a trader, you have to recognize where the leverage is and go with that. Perhaps when the whole thing becomes truly derailed might we have some true recognition of the problems presented by derivatives.

Ultimately, however, the game must be continued on some level. How many will step up to the table and "bet the farm" on the trade that could save everything? A few will, the ones who recognize the changes that are soon to be trickling through other sectors of the economy, such as, hmmm, SHIPPING & HANDLING charges? Not something that those mailorder companies want to face...

Derivatives have stepped the other markets through a financial looking glass allowing traders to see a financial wonderland where up is not always up and down is not always down. I think a great topic of discussion is do derivatives trades for a good affect the supply and demand for the real good (or service)?

Thinking about taking a leap this week? Double check your golden parachute.

Magician
View Yesterday's Discussion.

Black Blade
(03/15/2000; 01:59:34 MDT - Msg ID: 26848)
A strange dot.com tale!
Let's join the fun!!!!The NASDAQ and Asian dot.coms continue to tumble. The madness of dot.com mania has resulted in some truly amazing investments. The following account really puts this market in perspective.

A publicly traded company, Netj.com (NASDAQ: NETJ), is a company that " �.. currently has no business operations, no employees and no operating revenues" as one of it's directors describes it. It exists for the sole purpose of merging with an existing business or company. Originally the company had a business plan to become a collection agency over the Internet. These plans didn't work out. In fact, the company changed it's name twice. Originally it was called Professional Recovery Systems, and later Netbanx.com. After 4 and half years the company still is in search of a viable business. Strangely, this company trades daily and has recently reached new highs, capitalizing the nonexistent business at about $80 million.

Black Blade: I think that we should all create a dot.com name, register it, put it on an exchange, sell shares, and as officers of the corporation collect a healthy salary, and plan a great golden parachute for the inevitable ;-)
Mr Gresham
(03/15/2000; 02:03:31 MDT - Msg ID: 26849)
Solomon -- Derivatives -- The 1 A.M. Follies...
I'm almost picturing an early Madonna stage act: "'Cause we are livin' in a Derivative World -- and I am a Derivative Girl."

It brought up a favorite science fiction story from 1961, Hal Draper's "Ms fnd in a Lbry", (appeared in Groff Conklin's "17 x Infinity" short story collection) about interstellar cultural archeologists trying to recreate the story of Earth's society and its collapse. Apparently, all information had been compressed so minutely ("micro-nudges on the side of an electron") that all of Earth's information was kept in a drawer-size storage compartment in a central information facility. All data links were made to it, and, since everything that could be known was known, scholars spent their time writing Histories, Indexes, and Bibliographies. Also Histories of Bibliographies, Indexes of Histories, Indexes of Indexes (I-squared), etc, right down to H53-I34-B42 ("A History of History of....")

One day, a link to the information drawer fed back upon itself; the connection to the storage was short-circuited, and very soon the "civilization" collapsed. Pretty astute for 1961, I think.

Money is a derivative of the things we really need or want. If I was locked in a POW camp, I'd trade cigarettes along with everyone else, though probably never smoking any of my "cash".

Corporate profits are the expected results of putting out money to get back more, a derivative of risks taken with your money.

Share prices are a derivative of corporate profits, at least in the long run, or perhaps only long ago on a planet called Earth.

Share prices in a bubble are a derivative of what "everyone" thinks others will be willing to pay for them in the very near future, though no one is quite certain about the time frame for this to be realized, and it is mathematically impossible for more than a few to gain the glorious profit that all are drooling after. Definitely a "fractional reserve" kind of situation.

Options are bets on the share price at a particular future date, and they are derived from expectations as to price volatility.

Bond prices are derivatives of another set of money flows and expectations.

T-bill value is a derivative of USGovernment stability and long-term IRS functioning.

Bank accounts are loans to thinly-capitalized private corporations, which have been lent out to others based upon a derived set of expectations.

Derivatives of derivatives: D-squared, D-cubed, D-quadratic equationed...

Derivative layered upon derivative, and everyone thinks they have measured well enough the extent of risk taken with their hard-earned cash, and pulled back from the excess risks taken by others. Until the onion layers are peeled back, and several orders of magnitude of risk are found to have co-habited very closely on the spectrum most thought they knew so well. Out on limb, quite comfortable, until someone chainsaws the entire tree. T-bills and Amazon.com fall in flames together.

Gold's value is derived from the labor and goods that enough living people with enough purchasing power are willing to part with, and the non-Western nations seem to be willing to anchor that value against its purported disappearance amidst the Western "New Paradigm" follies. Also the Central Banks seem to have kept it as their core holding against the collapse of any or all derivatives, including their own.

Gold, as I believe Aristotle has described it before, is payment certain. Not market winnings that first require several Rube Goldberg contortions to be "derived" at, and then successful payment to thread its way through the gauntlet of failing banks, brokerages, insurers, etc., then payment to be converted into useful goods. (Somehow I think of Ali Baba's "40 Thieves", but I'm not sure why.)

The more bubbly things get, the more likely it is that all derivatives will telescope into one great "debtor's holiday", and only those "investors" found sitting in a chair when the music stops will have a chair to sit in, no matter how much all were enjoying the music together. (Oro? "There is no spoon", but there IS a chair?)



Black Blade
(03/15/2000; 02:13:06 MDT - Msg ID: 26850)
The Stench from Japan is unbelievable!!!!
Source: Bridge newsTOCOM leaves fixed-price control on existing palladium contracts

Tokyo--Mar 15--Japan's Tokyo Commodity Exchange (TOCOM) announced Wednesday it has decided to maintain fixed-price controls for all palladium contracts, except Feb 2001 contract, until the contracts expire. Delivery against the contracts will be prohibited, the exchange said. (Story .11251)

Black Blade: Of course delivery will be prohibited, there isn't any Palladium left in the stockpile! Can you say "Force Majuere"? I knew you could! The Russians cannot deliver what simply does not exist. These PGMs disappeared faster than an IMF dollar!

Zenidea
(03/15/2000; 04:55:40 MDT - Msg ID: 26851)
Just me
Blake Blade, re 26850, it seems that way . The cuboard is bare .
scp, re 26815. thanks I found it interesting for a chart novice :).
Cant seem to validate at ( Le metrople cafe ????)
The Invisible Hand
(03/15/2000; 05:30:17 MDT - Msg ID: 26852)
two camps
The euro camp would oppose the dollar camp.

The euro camp would be supported by the BIS.
Acording to THE STING, quoted in SteveH (4/6/99; 20:04:43MDT - Msg ID:4361), the Fed is a member of the BIS.

It seems to me that the Fed cannot support both camps. so the dollar would be supported only by the US Treasury.

Is there then a struggle between the Fed and Treasury?
ss of nep
(03/15/2000; 06:44:52 MDT - Msg ID: 26853)
Islamic Banking update -
for those that did not see this yesterday

Date: Tue Mar 14 2000 10:55
SDRer (Of Interest? The world that is not the West?) ID#246299:
Copyright � 1999 SDRer/Kitco Inc. All rights reserved

[1] Welcome to the Online Islamic Banking project. The primary purpose of this Web site is to demonstrate software for Islamic banks. As Islamic banking continues to grow at a furious rate, there will be more and more demand from Muslims for online access to their accounts and investments.
http://www.islamicbanking.com/

[2] IBF-Net, the Islamic Banking and Finance Network welcomes you to the world of Islamic banking and finance.

The Islamic financial services industry is globally one of the fastest growing sectors. There are currently over a hundred financial institutions exclusively in this sector.
http://islamic-finance.net/

[3]
Welcome to Islamic Banking from The Al Ameen Group [India]
O ye who believe! Fear God, and give up What remains of your demand For usury, if ye are Indeed believers. If ye do it not, Take notice of war from God and His Apostle: But if ye turn back Ye shall have Your capital Sums: Deal not unjustly, And ye shall not Be dealt with unjustly The Qura'an, Al Baqara ( 278-279 )
http://www.aific.com/index.htm


[4] Islamic banking in Malaysia
http://www.muamalat.com.my/bankmuamalat-thebeginning.html


[5] Welcome to the Islamic Investment Banking Unit's unique world of Islamic Finance

Whether you want to buy a home or invest for the future, we want to welcome you to our unique range of halal choices - because you have a right to choose.

In this site we aim to give you information on the choices we can give you for your halal finance.
http://www.iibu.com/
..
dinar...dirham...one billion + people...oil...gold...silver...a moral principle...trot around that circle for awhile...




RS
(03/15/2000; 06:54:53 MDT - Msg ID: 26854)
@ Ross L. : Would the people cooperate with confiscation of gold ?
Ross L: You wrote:
"Would the people cooperate with confiscation of gold ?"

Sir, repeat after me:
"I spent it all! Whiskey and women. Alas....."
ss of nep
(03/15/2000; 07:17:12 MDT - Msg ID: 26855)
For those that understand French
http://www.scdut.com/

Date: Wed Mar 15 2000 06:46
SCD CONSEILS (Technical analysis DJIA/GOLD) ID#293333:
http://www.scdut.com/
Nom:djia
Password:gold
until 15/03 6pm




USAGOLD
(03/15/2000; 08:38:30 MDT - Msg ID: 26856)
Today's Gold Report: April Could Live-Up to Cruellest Month Reputation
http://www.usagold.com/Order_Form.html/15/00 Indications
�Current
�Change
Gold
289.00
+,80
Silver
5.13
+.05
Gold Lease Rate 1mo
0.5350%
+0.0675
Gold Comex Stocks
1,588,364
151,360


Market Report (3/15/00): Gold ended its retreat of the past few sessions as
inflationary expectations and interest rates concerns bedevilled the markets.
Yesterday, the tech-rich NASDAQ, following in a worldwide trend to dump
technology stocks, suffered its second worst plunge in history -- over 200
points. Gasoline, on the other hand, is in a bull market reaching an all-time
high and the biggest 12 month increase in U.S. history according to a report
issued by the American Automobile Association yesterday. London's Standard
Bank summarizes gold market activity this way: "The yellow metal is well and
truly stuck in a range $2 either side of $290 and is unlikely to break out of
this band until next Tuesday's Bank of England auction of 25 tons. Physical
buyers are happy with the current price level and producers can certainly
live with gold around $290. However the current lack of volatility will not
please the Funds and the BofE auction may prove to be the catalyst that
prompts them to make a move one way or the other." Though we lean toward
agreeing with Standard's reading of the tea leaves for the short term, we
would throw the potential for another catalyst that could change that view:
The inflation numbers to be released tomorrow and Friday along with the
Federal Open Market Committee conclave scheduled to begin on Monday.

Here a final consideration before we wrap this up this morning that might
have a strong impact on physical demand over the next 90 days: Quarterly
mutual fund statements for the first quarter will be going out in April.
These statements will be the first inkling the investing public will have of
the direct effect of the recent plunge in equity values across the board over
the last 75 days. Investors accustomed to clockwork gains might be forced to
reconcile themselves to something new -- plunging personal investment
portfolios. Such will be sure to provide a sinking feeling and could send
many reaching for not only the Rolaids but the telephone to call their
friendly gold broker. It is amazing how many people disconnect the daily news
from their own portfolios until those mutual fund statments hit the mailbox.
By April's end -- the cruellest month -- investors will feel the full and
combined impact of skyrocketing energy costs, plummeting stock portfolios and
the return of inflation in their daily lives -- an interesting combination of
maladies not seen since the 1970s. It could get interesting. One more item:
During the decade of the 1970s, gold rose 2000%.

That's it for today, fellow goldmeisters. We'll see you here tomorrow.

If you are looking for a pro-gold view of the various financial markets as
well as a summary of the events affecting the yellow metal, our monthly
newsletter might be of interest. News & Views -- Forecasts, Commentary
& Analysis on the Economy and Precious Metals has been characterized
as witty, urbane, intelligent and down-to-earth. Not to mention it's Free of
Charge If you want to keep up with gold, this is the way a large segment of
the gold owning public does it, and has done it for over a decade.

Just click on link above and make the appropriate entries.
Journeyman
(03/15/2000; 09:08:06 MDT - Msg ID: 26857)
Flush tank fills as "foreigners" continue to collect "dollars"

- Current Account Deficit for the last quarter was $99.87 billion, up from ~$89 billion the previous quarter. -CNBC, 00/03/15, 10:04:02 AM

The "Current Account Deficit" attempts to measure the net out-flow of "dollars," over a particular period of time. These dollars are held by "foreigners" "outside" the U.s. The total dollars held "outside" the U.s. is thus increased by each current account deficit. These outside dollars are potential instant inflation should foreign dollar holders decide to no-longer keep them because they would have to be spent here on goods and services. As much as 80% of dollars (including e-dollars) are held outside the U.s. Should they all come home, the depreciation rate (inflation rate) implied by the 80% figure is 500%. This is the scenario alluded to by FOA/Another/TG .

Think of the current account deficit as similar to the gradual filling of the flush tank on your toilet, but it's a really big tank. What happens if someone pulls the lever and it finally flushes?

Regards,
Journeyman
Felix the Cat
(03/15/2000; 09:46:07 MDT - Msg ID: 26858)
The comments of Zhu for Taiwan's Presidential Vote
http://www.bloomberg.com/bbn/topworld.html?s=8d94fdcc6401f792148303af129305d1China's Zhu Says `Concessions' Possible After Taiwan's Presidential Vote
By Alison Jahncke

China's Zhu Says `Concessions' Possible on Taiwan (Update2)

(Adds analyst comment in first section.)

Beijing, March 15 (Bloomberg) -- Chinese Premier Zhu Rongji
said China is prepared to make ``concessions'' in talks with
Taiwan if the winner of Saturday's presidential vote disavows
independence.
``There can also be concessions made on our part but these
concessions will be concessions made to our fellow Chinese,'' Zhu
told reporters. ``Whoever pursues Taiwan independence will not end
up well. The cause for such a person would not be a popular
cause.''

Taiwan's three leading presidential candidates, Vice
President Lien Chan of the Kuomintang, Chen Shui-ban of the
Democratic Progressive Party and independent candidate James
Soong, are locked in a virtual dead heat. The DPP has advocated
independence, a possibility China considers unacceptable.

Zhu also paraphrased a recent comment by U.S. President Bill
Clinton that there should be a shift from threat to dialogue
across the Taiwan Straits. Breaking into English, a language in
which he is fluent, Zhu said ``There must be a shift from threat
to dialogue across the Pacific Ocean.''

Analysts said Zhu's remarks, made at a news conference to
mark the end of the National People's Conference, make it clear
that China favors the candidacy of KMT's Lien. ``Beijing is eager
to give a guiding hand to the voting public in Taiwan,'' said
Samuel Webster, director of research at Credit Suisse First Boston
in Taipei.

Taiwan's key stock index fell 2.2 percent today, led by
large, easily-traded stocks such as Taiwan Semiconductor
Manufacturing Co., on concern a DPP victory could harm fragile
relations with China. The index is down 15 percent since reaching
a peak so far this year in mid-February.

`Be Vigilant'

The DPP's original platform, adopted soon after it was
founded in 1986, calls for the establishment of Taiwan as a
sovereign state. Within the past year, however, the DPP has toned
down its pro-independence rhetoric, and now says it has no desire
to provoke China by declaring independence or calling for a
referendum on the issue.

The ruling KMT fled China for Taiwan in 1949, after the
victory of the communist party in the Chinese Civil War.

Zhu reiterated China's position that Taiwan must eventually
reunify with the mainland. A Taiwan president who advocates
independence would be ``unacceptable,'' he said, while also saying
China will not interfere in the vote.
``We must be crystal-clear that no matter who comes into
power in Taiwan, Taiwan will never be allowed to be independent,
and Taiwan independence in whatever form will never be
acceptable,'' Zhu said. ``This is our bottom line. This is also
the will of the 1.25 billion Chinese people.''

Zhu said China will support a Taiwan president who advocates
reunification. ``Whoever stands for one China will get our support
and we will have talks with him,'' he said.

At the same time, Zhu reiterated China's longstanding policy
that it will not renounce the use of force to unify Taiwan and
China.
``If the Taiwan question should be allowed to drag on
indefinitely, how can it be possible that we will not use force?''
he said. ``The proposition has been put forward long ago.''

Zhu said Taiwan's voters should ``be vigilant'' and that he
understood their fears that a victory by ``pro-independence''
forces could lead to war.



Journeyman
(03/15/2000; 10:15:36 MDT - Msg ID: 26859)
BOJ messes with the dollar

- As the yen rose strongly against the dollar in over-night trading, the Bank of Japan (BOJ) intervened, buying dollars [shrinking the available supply] by selling yen [increasing the available supply]. The BOJ says it has intervened before and won't hesitate to intervene again because a strong yen threatens the Japanese recovery. -CNBC, 00/03/15, 11:47:22 AM

The "Law of Supply and Demand" applies to money and money substitutes, thus increasing the supply of a particular financial vehicle, in this case yen, tends to reduce it's value. At the same time in this case, by buying dollars, the BOJ reduced the supply of dollars, tending to increase it's value.

Such manipulations, involving another countries currency, _COULD_ be the most overt moves in what we here at USAGOLD have been calling "currency wars." This action by BOJ was almost certainly NOT intended as hostile, however, and is NOT likely perceived negatively.

But such manipulations of currencies of other countries has the POTENTIAL of having momentous consequences as you can probably imagine. The vulnerability of the "dollar" is that if it weakened appreciably, the holders of all those "overseas" dollars (estimated as about 72% of all "dollars" in circulation by ORO) might be motivated to dump the dollars they're holding, leading to an ever increasing in-flow of dollars into the U.s. as Big Float comes rushing home.

Regards,
Journeyman
SALMON
(03/15/2000; 10:21:33 MDT - Msg ID: 26860)
@Farfel
@Farfel

Enjoy your postings, would like to see the write up you sent to the Globe&Mail re: Barrick.

I sent Barrick the following:.....

How were we able to function without those hedges ?

In case you did not notice YOUR PREMIUM GOLD HEDGE PROGRAM works perfectly on the short side. Now I am shorting the Barrick stock and finally making some money. Thanks for my premium Barrick hedge program.

To be successful with this one you have to short on a spikes. You can't lose if a US Government Agency and bullion banks are behind you.
There is only one: true, pure gold play around- FRANCO NEVADA
- NO DEBT
- NO HEDGE
- NO WRITE OFF
- NO MESS , ONLY FIRST CLASS ASSETS.
Or if you like small - FRANC-OR.

Thanks
S+
Cage Rattler
(03/15/2000; 10:34:00 MDT - Msg ID: 26861)
@Journeyman
re BOJ intervention and increased supply of dollars - it all depends if it is sterilized or unsterilized. Recently, they always been sterilized thereby NOT increasing the supply of dollars. Also, rumours are doing the rounds that the BOJ was seen buying around $2 billion 5yr treasury notes a while ago.
Farfel
(03/15/2000; 11:28:46 MDT - Msg ID: 26862)
Itemus (aka Vengold) Plunging Today on Low Volume
As I warned in previous posts, an internet stock with almost 200 million shares is a most dangerous investment in this type of low float internet environment.

The key to internet stocks rising through the roof has been their very low floats of 4 million to 8 million shares on average. With such low floats, it is inevitable that public demand will exceed supply.

But when an internet stock has enormous float, then supply usually far exceeds demand and its upside is usually capped at a low share price. On top of that, if the stock trades in an OTC BB type of market, then the bids can simply disappear on the spin of a dime.

Today the volume is a mere 800,000 vs. average volumes exceeding 4 million during its first week of trading. At a certain point, the volume may heat up again and one can only imagine what can happen to a stock when over a hundred million shares want to sell at the same lofty price.

When gold stocks or gaming stocks, etc. convert to internet stocks, then that sounds like a very loud bell signalling the end of a boom is at hand.

What a mess it will be when the internets trade at their real value prices something like 90% below current values.

Thanks

F*
Farfel
(03/15/2000; 11:33:50 MDT - Msg ID: 26863)
@SALMON....As Per Your Request
Salmon, thanks for the compliments.

As per your request, I am reposting the letter to Barrick printed in the TORONTO GLOBE AND MAIL:
--------------------
December 12, 1997


Re: "Munk Pans Knee Jerk Reaction Against Gold."


Dear Editor:


Mr. Peter Munk of Barrick Gold has some gall to blame World Central
Banks for the horror story unfolding in the gold mining industry. In
fact, he is one of the leading contributors to the malaise afflicting
the precious metal. Barrick's shareholders ought to fire him summarily
along with his entire executive board of sycophantic ducks.

Yes, it's true that, owing to forward hedging, he locked in most of
Barrick's production at $410 an ounce. Most observers would consider
that a shrewd tactic. However, it is a Pyrrhic victory at best. In
reality, forward sales of gold by self-serving mining companies like
Barrick contributed to the over-supply of gold in the market. When gold
reached $410 an ounce and the world's largest mining company sold
forward such a huge position in gold, is it any wonder that Central
Banks decided they ought to follow a similar course...especially given
gold's stagnant price over the last decade?

Mr. Munk further feigns concern about the possible social disruptions
that might unfold in a major gold-producing country such as South
Africa. When he dumped Barrick's gold supply upon the market at $410 an
ounce, was that an act of social conscience where South Africa is
concerned? Hell, no...it was Barrick acting in its own selfish
interest, oblivious to the perceptions and ramifications this huge
forward sale would have on the world gold market.

If gold mining companies really wish to convince Central Banks that gold
stands any chance of future appreciation, then they better skip the hot
air and pursue immediate, tangible strategies in addressing the
over-supply problem.

First, they must immediately cease all forward sales of gold. Secondly,
they must announce to the world that all future exploration of gold is
ending today and they will only work the existing mines. Third, they
must consolidate their industry so that it is similar structurally to
other major oligopolistic/monopolistic commodity suppliers (such as
OPEC). Fourth, they must mount a concerted propaganda campaign to
convince Central Banks and major global financial institutions that gold
truly is a financial reserve and not merely another commodity. In other
words, they must shift their focus from supply to demand. It seems
everytime we open a newspaper or turn on the TV today, we see a constant
assault on the value of gold mounted by disciples of the so-called "New
Paradigm." It would make a great deal more sense to forego opening a
single gold mine and use the monies saved to finance pro-gold lobbyists
and media exponents who can reverse the negative psychology that's
developed around the metal.

If the foregoing measures are adopted quickly, then I predict you would
see a short squeeze on gold that might send it back into the
stratosphere. In doing so, tens of thousands of hard-working miners
still might have jobs by the time Christmas rolls around.

The most unnerving aspect of the current gold crisis is its potential
spillover effects. Weakness in gold is spilling over onto other metals
such as platinum and copper. In effect, if counter-measures are not
enacted swiftly, we soon might witness numerous mine closures in
virtually every metal industry. Can you just imagine the devastation
this phenomenon would wreak upon the resource-dependent Canadian
economy? Already, various financial analysts are attributing unusual
weakness in the Canadian dollar to currency speculator concerns over
future, pandemic weakness in Canada's resource sector.

In conclusion, I would ask Mr. Munk one final question: if he is truly
bullish on gold as he claims, then why the hell is he shifting
significant amounts of assets into Trizec-Hahn, the commercial property
developer? If he truly believes in the gold mining industry, then he
is sending the wrong message by simply buying back his own company's
shares. The only message the buyback sends to the world is that Peter
Munk believes in Peter Munk. Instead, he should acquire another major
gold mining company (like Battle Mountain, Placer Dome, TVX, Homestake,
Royal Oak, or Kinross). In doing so, he will put the entire gold market
on notice that short sellers best beware because mining consolidation is
in the works.

Farfel
(03/15/2000; 11:59:33 MDT - Msg ID: 26864)
One Other Thing Re: SELL BARRICK BANK INC.!!!
Salmon, when you look over my letter you will note that in December of '97, gold traded at over 400 an ounce.

Today, approx. 2.5 years later, we are at miserable 290 an ounce with countless gold companies bankrupted and thousands of miners tossed into the streets.

We are told by the Establishment that there has been essentially no inflation since '97 but check out the costs of almost every product and service you buy today. No inflation, MY ASS!

Just imagine what the gold price might be today if Barrick Bank Inc. and the gold shorting cartel had not set about destroying the gold price back then.

Gold investors have been contributing to a shady collusive group of gold shorts' private bank accounts under the mistaken impression that a real genuine market exists in gold.

BULLSHIT!

Rotting in hell is too good for these lying scamming bastards!

SELL BARRICK BANK INC.SHORT!!!

REMOVE THE LOUSY COMPANY FROM THE XAU, STICK THE STINKING COMPANY INTO THE BANKING INDEX ALONG WITH GOLDMAN SACHS, JP MORGAN, DEUTSCHE, ETC. WHERE IT BELONGS

Thanks

F*
Farfel
(03/15/2000; 12:04:54 MDT - Msg ID: 26865)
Thoughts about the Greek Stock Market Disaster..
Is this the latest carry trade Wall Street is setting up?

You destroy the Greek economy and its stock market, then convince those Greeks who still have capital to move their money into US stocks and bonds?

A repeat of Asia? Latin America? Russia?

God, the Clinton government and its Wall Street owners sure know how to keep a stock market vertical, you have to give them credit.

Not too many foreigners like Americans anymore today however.

(You know you're in trouble when even the Canadians hate you!)

Thanks

F*
Farfel
(03/15/2000; 12:08:37 MDT - Msg ID: 26866)
Now That Greek Stock Market is Getting Trashed...
I suppose it will not be long before Wall Street interests convince the Greeks to sell all their "non-performing" gold reserves and place the monies into vertically ascending US investments.

Otherwise, say hello to the new "Greek Carry Trade!"

Thanks

F*
Farfel
(03/15/2000; 12:10:30 MDT - Msg ID: 26867)
Correction: SAY HELLO TO THE NEW GREEK CARRY TRADE EOM
EOM
SHIFTY
(03/15/2000; 12:13:18 MDT - Msg ID: 26868)
farfel
Im with you! Time to take out the trash it's stinking up the place.
SALMON
(03/15/2000; 12:38:51 MDT - Msg ID: 26869)
@Farfel
Your letter to the Globe was excellent. Not only that, what you foresaw in 1997 came to pass. What a debacle. On several occasions in telephone conversations with Barrick Bank Inc. they referred to "off balance transactions" when speaking of selling physical gold and investing the proceeds in T-Bills. I never got an explantion from them as to what an "off balance transaction" was in their terms, and I have never seen interest from those T-Bills in their annual report. Wouldn't you like to combine all your gains on one side and losses on another side and tell the tax man that all your gains are "off balance transactions"? Think it would work?

Back later - have to go out to buy a no inflation $2.90 Can. gallon of gas. There has to be an ending somewhere to this blatant corruption.

Thanks for the posting of your letter and your comments.
S+
ced_s
(03/15/2000; 13:28:03 MDT - Msg ID: 26870)
Copy of a note I sent to G.A.T.A. last evening
Maybe G.A.T.A. needs to form an investment group to counter the effects of these manipulators. The selling of shares to goldbugs could be for the initial funding. Then you could issue an IPO on Wall Street for the additional massive funding that would be required. I know this is not even feasable, but I would love to catch these manipulators by the short hair.
Our protests to the politicians has had no effect, maybe a few big losses by the Megabanks who pay them off with campaign contributions would catch their attention. G.A.T.A may even be served with anti-trust papers, for spoiling their easy money scam. Maybe A. Greenscam might even have a few words of wisdom for us, such as "cease and desist from spoiling my Dog and Pony show".
If the American Farmer were to demand records for the last 10 years from the commodities market, they would find the same scenerio. Too many farmers have been bankrupted or financially damaged to fund the biggest rip off of the American Public in history. If all of the details were known, the hue and cry of this Nation would be "Traitors and Blood Suckers". All of our politicians would fall in disgrace,especially those with big contributions from the banking and investment world.
SteveH
(03/15/2000; 13:56:21 MDT - Msg ID: 26871)
Dow UP 350 plus
and the NASDAQ down...hmm? My take? Money from NASDAQ now flowing to the DOW. Heh, what about gold?

As for platinum and TOCOM? (ode de things to come in gold and silver right here at home).

Canuck
(03/15/2000; 13:56:37 MDT - Msg ID: 26872)
Canadian CPI
http://ca.dailynews.yahoo.com/ca/headlines/bs/story.html?s=v/ca/20000315/bs/markets_canada_stocks_126.htmlExpectations of 0.3% increase in the CPI was not the case; Feb. CPI rolled in at 0.5. TSE300 & CNDX taking a sizable beating.

Let's see how our American friends fare out tomorrow and Friday.

Inflated Canuck.
SteveH
(03/15/2000; 14:18:49 MDT - Msg ID: 26873)
Brits say no to gold sales
http://www.businesswire.com/webbox/bw.030900/200691399.htmeom
Harley Davidson
(03/15/2000; 15:04:20 MDT - Msg ID: 26874)
HI - HAT, in your message ID:26842 you said...
"To me it is only a matter of some small time before the mismanagement or mis-steps of our ruling Oligarchy bring on the crises that will precipitate the calamity of these orders being visitated upon us. If it happens it will mean that the dictatorship we live under now, will be merely formalized."

Last I heard, the US was a democracy with leadership freely elected by free people. If you want to experience a dictatorship, I suggest you move to Iraq and openly criticize the government leadership. Were you to survive the consequences of such behavior (unlikely), I suspect you might have a different perspective of America.
onlychild
(03/15/2000; 16:31:24 MDT - Msg ID: 26875)
Harley Davidson
Just a clarification: We do not live in a democracy, our nation is a republic. In a democracy laws are made by the body of the citizens. In a republic the citizens elect representatives who may or may not execute the will of the people. They are not bound or required to do our bidding, however they often do for reasons that are obvious this election year. "...and to the Republic for which it stands..." Too much to go any deeper here.
HI - HAT
(03/15/2000; 16:39:17 MDT - Msg ID: 26876)
Harley Davidson 26874 AMERICA
Sir, My adult " perspective ", of America began being forged in 1968 and 1969 when at the age of 18 I did a double tour in Viet Nam. My views of the U>S> Federal Government from then til now have dimmed appreciably. I see a power structure more arrogant and unaccountable by the minute. Could this be because we have degenerated into a democracy where Mobs have been propagandized into believing we are a free people and are further placated in a cunning way so as to keep the Founding Fathers dictums of a Representative Republic where all levels abide within the boundaries of the Constitution. Please do not take it that I disparage the American people. Do not confuse the country with the ruling power structure. Is not our dislike with the Iraqi Government and not the Iraqi people. Brother, again I do not disparage the American People.
R Powell
(03/15/2000; 17:09:13 MDT - Msg ID: 26877)
Blood pressure, good explanations and money movement
Just read all of todays posts. It's great reading when Farfel gets his dander up- thanks. Thanks also to Journeyman for easy to understand examples/definitions of currency intervention and "big float". I'll try to get the misses to read them. A thought on money flowing from the NASDAQ to the DOW and vise-versa- I don't think it would take very much of those $$ directed toward gold and silver to get things moving. Consenus seems to be that gold buy orders are placed just above the present 288-292 price range. This thought also from Steve H's observation, what happens if both the NASDAQ and DOW have big down days? The more volatile they become, the better chance for a big metals move, even if it's started quite unintentionally! However, if anyone has the wherewithall to manipulate a big upside move, by all means, carry on. Turn about is fair play as my opinion.
Journeyman
(03/15/2000; 17:18:10 MDT - Msg ID: 26878)
Thanx for the additional info Re: Cage Rattler (03/15/00; 10:34:00MDT - Msg ID:26861)

Regards, J.




Harley Davidson
(03/15/2000; 17:28:24 MDT - Msg ID: 26879)
onlychild, HI - HAT: thanks for your responses.
onlychild - Point well taken. I used the term as it is defined in Webster's i.e. "a government by the people" (via electoral college) as contrasted with a dictatorship i.e. a despotic state.

HI - HAT, I'm not sure things have deteriorated with the velocity you say. After all, the Nixon era is a special time all to itself and a hard one to beat for sleaz factor (although Clinton is not content for second place). Your post didn't imply that you were disparaging the American people, I simply felt compelled to respond to the inaccuracy of it. onlychild chose to not let my statement go uncorrected and I chose to respond to your statement - "the dictatorship we live under...".



HI - HAT
(03/15/2000; 17:53:16 MDT - Msg ID: 26880)
Harley Davidson Golden Truth
We just see things a little differently, but otherwise are brothers in Truth. Golden Truth.
Zenidea
(03/15/2000; 18:33:29 MDT - Msg ID: 26881)
reuters
Cambior to sell to Beakwater. Reuters- Beleagured Canadian metals minor Cambior T CBJ, stung by a faulty hedgeing program said on wednesday it would sell its zinc assets to Breakwater reasourses T. BWR to help shave its debt.
Leland
(03/15/2000; 18:59:23 MDT - Msg ID: 26882)
"Inflation Rate Double Official Figures"
By Ryan Troup and Christopher Ruddy
Mar. 14, 2000

MONEYNEWS.COM -- Jan. 20, 1993, and Bill Clinton was not president 24 hours when
he saw James Dale Davidson at one of several Washington Inaugural Balls.

Clinton quickly waved past the salutations and congratulations. "Jim," he said, "You
may able to help me."

Davidson, a Clinton campaign donor, a financial writer, then head of the National
Taxpayers Union and someone who had known Clinton for years from annual retreats at
the Hilton Head Renaissance weekends, nodded with agreement.

"I think the Bush people were cooking the economic numbers in the months before the
election," Clinton said, continuing, "Do you think you could put together a report for
me on how they did it?"

Davidson agreed but the thought went racing through his mind, "This man's not
president for one day and he's already trying to figure out how to fix the books."

Since his inauguration Clinton has survived an avalanche of scandals that would have
crushed any other mortal.

One factor cited by both Clinton critics and friends has been the booming U.S. economy
and the longest bull market in the history of the world.

"It's the economy, stupid!" was the Carville-inspired slogan of the Clinton-Gore �92
campaign. The slogan has become the White House mantra for two terms.

Federal Reserve Plays Key Role

Since World War II the chairman of the Federal Reserve has had an increasing influence
over the U.S. economy.

The chairman and the rest of the Federal Reserve Board set U.S. monetary policy �
independently of any administration.

After the stagflation years of the 1970s, the Federal Reserve has watched for any signs
of inflation. Using interest rates as a spigot, the Fed has turned and tightened the
spigot by raising or lowering interest rates.

So far so good.

Chairman Greenspan, during almost eight years of Clinton-Gore, has kept the spigot
loose. Though the economy has been at warp drive, there has never been any sign of
rising inflation.

Unemployment, another key number, has been low, but never too low, simply indicating
the economy has been at full employment � or in excellent health.

Greenspan's, and the rest of the Federal Reserve's, decision-making has been
independent � there is no evidence they have been pressured by the Clinton
administration. Still, their decision-making has been based on the statistics provided by
the administration.

Statistics like the inflation rate, technically called the CPI or consumer price index, are
measured by the Bureau of Labor Statistics, an agency of the Department of Labor.

Earlier forms of today's CPI started out in the 1880s as a way to measure the impact of
tariffs on goods. Then around 1915 it was used to adjust shipyard workers� salaries to
the cost of goods.

After World War II, the index was used by auto manufacturers in negotiations with auto
workers for wage adjustments. This is why today's survey is still biased to where
automotive plants were located.

Statistics Don't Lie � People Do

Mark Twain remarked that "Statistics don't lie, people do." We may have to revise
Twain's statement to say government agencies lie, too.

During the past eight years the Bureau of Labor Statistics has reported the CPI to be
nearly flat.

Economies typically suffer some inflation during periods of rapid expansion. Oddly, this
has never been the case during the past decade.

But the question of the CPI was really brought home in the past year, as oil prices have
tripled from as low as $10 per barrel in December 1998 to well over $30 today � a fact
reflected in spiraling gas and home heating prices.

The U.S. Energy Information Administration has reported that retail gas prices, for
example, are up over 60 percent from last year's levels.

Despite these increases, and the enormous role played by oil and its by-products in the
economy, the CPI still is almost flatline.

In Europe, governments and the European Union have reported a sudden rise in
inflation due to oil price increases � but the federal government claims oil prices have
had little effect on inflation.

In December 1999 the annualized rate of inflation was at 2.7 percent. By January 2000,
the annualized change in CPI had remained at 2.7 percent � despite the fact that
"energy" sector forms the second largest part of the U.S. GDP, just after health care
costs.

Media Myth: "New Economy" Stopped Inflation

Rather than inquire into just how the government is compiling these highly suspicious
numbers, the major financial media has been spinning for the administration.

Stories that appeared in the Wall Street Journal and the New York Times business
sections in December 1999 took the apologist line.

Both stories emphasized this theme: the "New Economy" and the Internet had so
dramatically structured the U.S. economy that oil prices were just not such an important
component of CPI.

It is true that the Internet and computers are restructuring economy, but not
dramatically enough to lessen the importance of oil. Just look at the numbers.

Consider that total internet consumer spending amounted to a tiny $5.3 billion in the
fourth quarter of last year. Total U.S. retail sales during the same period was a gigantic
$771.7 billion. Internet spending was simply a drop in the bucket.

The Internet is growing, but the old-fashioned mail order catalogue business does a
brisk $100 billion in sales a year � five times the spending made on the Web.

Amazon.com, the most celebrated e-tailer, sold almost a $1 billion worth of goods last
year over the Internet. Most of it books. Still, Internet book sales represent only 5
percent of the total U.S. book market.

And though the economy is changing radically, it is still unclear how the new economy
will impact the demand for oil.

Oil is still needed to give electric power to computers on the Web, to heat the
warehouses used by companies like Amazon and fuel the planes, trains, postal and UPS
trucks that have been busy delivering Internet orders.

Common sense indicates that a dramatic rise in oil prices, as we have seen, leads to
large increases in CPI.

Federal Government Fixed Numbers

Since the early 1990s, the federal government has been gradually altering the way CPI is
computed by making various adjustments

According to economist John Williams, who directs the Shadow Bureau of Government
Statistics, a private firm that monitors government number crunching, the federal
government has been using several clever and questionable techniques to keep the
stated inflation rate low.

Mr. Williams estimates that the current annualized CPI is above 5 percent � more than
double the 2.4 percent annual rate reported by the federal government.

To create a false and artificially low rate, Mr. Williams reveals, government economists
use the technique of "geometric weighting."

Mr. Williams states that geometric weighting "gives a lower weighting over time to
goods that are increasing in price." The first year that geometric weighting was fully
implemented was in 1999.

The thinking behind geometric weighting goes like this: if prices rise on a brand name
product, consumers just move to generic brands, or use other types of products.

It's s nice theory, but consider why such thinking might not apply to real people. Gas
prices have increased dramatically. Have motorists stopped driving cars? Have they
begun using buses? Bicycles? Walking instead? The answers are likely no.

Quality adjustments are another way the government keeps the stated inflation number
low.

For example when the government required that an additive be put into gasoline to make
it cleaner, the CPI was adjusted to not reflect the price increase that was directly related
to the additive.

In other words, the end consumer saw higher prices, but because the government
thought they were getting a better product, they shouldn't think of this as inflation!

Other quality adjustments include government-mandated changes to auto production
such as the addition of catalytic converters. Mr. Williams says these adjustments are
"not legitimate if the buyer doesn't have any alternative. The buyers are stuck paying
the higher price."

[Fair Use for Educational/Research Purposes Only,
and Thanks to Ryan Troup and Christopher Ruddy,
USA JOURNAL]
R Powell
(03/15/2000; 19:08:23 MDT - Msg ID: 26883)
A view of the trading floor
http://www.swiss-financial.com/cotton_market.html Question to All. Does anyone know of a site or news service that describes the exchange proceedings for gold and silver similar to what the above link does for cotton? It gives a blow by blow picture of whose buying, whose selling and when from the opening to the close. Hope it works, it's the first I've ever posted. TIA for any leads.
Zenidea
(03/15/2000; 19:16:15 MDT - Msg ID: 26884)
The Lunatics have taken over the Assylum .
Like Farfel my turn to have a healthy de-brief. :).
Our Aussie Government was for a signicant part elected on the basis of John Howards statement that " there would be no new taxes." So what did he do ?.Yes slammed all though's earning over 50,000.00 with a medicare surcharge.
and now he wants to clout the Aussie taxpayer with an East Timor levy . But the medicare surcharge he says is an incentive an encouragenment for people to get private health coverage, when in reality it seems to be in the eyes of the people nothing less than a form of blackmail, extortion. What worries me is that our own
Prime Minister dosnt seem to recognise unlike the average God fearing church going , pub crawling Aussie public the difference between what the truth and a lie is! .
And they privatized a large piece of Telstra . in effect selling back to the people something for which we are already supposed to own. And as for Gold , as everyone knows the mouth sold off a significant lump of our Gold reserves and then proudly announce what he had done seemingly without remorse for the empty plates that as a consequence he left on the tables of many Aussie families. When he says as he so often does ." This will be good for Australia" , I can assure by that he dosnt mean the Australian people. The Lunatics have taken over the assylum !.
R Powell
(03/15/2000; 19:35:27 MDT - Msg ID: 26885)
"Quality adjustments"
Mr.Leland, I've been wondering how the powers that be have been justifying this no inflation bull. If we subtract quality adjustments from the sticker price of a brandy new pickup truck, I'll bet we could get one for about the $3200 I paid for my first ever in 1972. I also think it was a better truck than what's being produced today. Eventually, the effects of inflation will be seen and have to acknowledged and like other denials/manipulations, the longer they go unaccepted and uncorrected, the worse the final reckoning will be.
Leland
(03/15/2000; 19:46:48 MDT - Msg ID: 26886)
R Powell
My problem with the whole thing, I can go back to 1939 when
pickups cost about $800. Geez, what's happened!
onlychild
(03/15/2000; 20:41:07 MDT - Msg ID: 26887)
Somebody north of 49 kiss this guy for me
 > TRIBUTE TO THE UNITED STATES
 This, from a Canadian newspaper, is worth sharing
America: The Good Neighbor. Widespread but only partial news coverage was given recently to a remarkable editorial broadcast from Toronto by Gordon Sinclair, a Canadian television commentator. What follows is the full text of his trenchant remarks as printed in the Congressional Record:
"This Canadian thinks it is time to speak up for the Americans as the most generous and possibly the least appreciated people on all the earth. Germany, Japan and, to a lesser extent, Britain and Italy were lifted out of the debris of war by the Americans who poured in billions of dollars and forgave other billions in debts. None of these countries is today paying even the interest on its remaining debts to the United States. When the franc was in danger of collapsing in 1956, it was the Americans who propped it up, and their reward was to be insulted and swindled on the streets of Paris. I was there. I saw it. When earthquakes hit distant cities, it is the United States that hurries in to help. This spring, 59 American communities were flattened by tornadoes. Nobody helped. The Marshall Plan and the Truman Policy pumped billions of dollars into discouraged countries. Now newspapers in those countries are writing about the decadent, warmongering Americans. I'd like to see just one of those countries that is gloating over the erosion of the United States dollar build its own airplane. Does any other in the world have a plane to equal the Boeing Jumbo Jet, the Lockheed Tri-Star, or the Douglas DC10? If so, why don't they fly them? Why do all the international lines except Russia fly American Planes? Why does no other land on earth even consider putting a man or woman on the moon? You talk about Japanese technology, and you get radios. You talk about German technology, and you get automobiles. You talk about American technology, and you find men on the moon -not once, but several times - and safely home again.
You talk about scandals, and the Americans put theirs right in the store window for everybody to look at. Even their draft-dodgers are not pursued and hounded. They are here on our streets, and most of them, unless they are breaking Canadian laws, are getting American dollars from ma and pa at home to spend here. When the railways France, Germany and India were breaking down through age, it was the Americans who rebuilt them. When the Pennsylvania Railroad and the New York Central went broke, nobody loaned them an old caboose. Both are still broke. I can name you 5000 times when the Americans raced to the help of other people in trouble. Can you name even one time when someone else raced to the Americans in trouble? I don't think there was outside help even during the San Francisco earthquake. Our neighbors have faced it alone, and I'm one Canadian who is damned tired of hearing them get kicked around. They will come out of this thing with their flag high. And when they do, they are entitled to thumb their nose at the lands that are gloating over their present troubles. I hope Canada is not one of those.
Stand proud, America!
Journeyman
(03/15/2000; 21:09:59 MDT - Msg ID: 26888)
Federal Reserve admits fiddling "inflation" figures --- etc.

[NOTE] 1. 0ver the past three years, the Bureau of Labor
Statistics has introduced a number of technical changes in
its procedures for compiling the CPI [Consumer Price Index],
with the aim of obtaining a more accurate measure of price
change. Typically, the changes have only a small effect on
the results for any particular year, but their cumulative
effects are somewhat larger and are tending to hold down the
reported increases of recent years relative to what would
have been reported with no changes in procedures. Apart from
the procedural changes, the reported rate of rise from 1998
forward will also be affected by an updating of the CPI
market basket, an action that the BLS undertakes
approximately every ten years. -[Federal Reserve,] Full
report on [Feb. 1998] Humphrey-Hawkins testimony, www.bog.frb.fed.us/boarddocs/hh/1998/february/Full-
Report.txt>

- The Democrat administration has changed the way they
measure inflation, the way they measure the CPI [Consumer
Price Index], which makes inflation about 1% lower than it
would have been before. [Thus inflation, reported today as
~1.5% would have been ~2.5%. -J.] -Chief Economist Bill
Wollman, CNBC, 26 Feb 1999, ~4:50:49 PM EST

Regards,
Journeyman
Farfel
(03/15/2000; 21:10:57 MDT - Msg ID: 26889)
QUALITY ADJUSTMENTS in the CPI...What a farce!
What really cracks me up about this corrupt, manipulative Clinton government is the quality adjustments (aka hedonics) utilized in calculating CPI/PPI, etc.

For example, these guys constantly adjust price figures on the basis of alleged "quality/productivity enhancements" in products, e.g., if a $1200 COMPAQ computer today works twice as fast as a $1000 COMPAQ last year, even though it costs more money, the government will report the "real cost" of the computer as being 50% cheaper on the basis of its productivity enhancement.

But does the government work the figures the same way in reverse? Do hedonic calculations translate into DIS-hedonic prices? OF COURSE NOT!

For example, if I pay for a seat on an airline today for a trip between L.A.- New York and the price is $400 today vs. $400 a year ago, does the Clinton government factor in proper quality downgrades?

Do the Clintonites add to the price of today's airline ticket on account of my receiving 20% less leg space, one less flight attendant, a much more inferior piece of imitation meat in my synthetic dinner, a smaller bagage compartment to place my carry-on, a greater likelihood of late departure owing to over-crowded airports, etc., etc?

In other words, on the basis of quality adjustments, then the airline ticket is not of equal value today as it was yesterday. Thus the real price has greatly inflated if one considers that the service provided in no way equals service of past years.

There are many examples I can cite where such DIS-hedonics, if factored into current prices of products/services, would show remarkable inflation today.

But you will never see any facsimile of truth coming from this government, and the Wall Street-manipulated gold market remains the litmus test of corruption running rampant in America.

Thanks

F*


JA
(03/15/2000; 21:11:40 MDT - Msg ID: 26890)
On the Price of Cars
Several years ago while driving to work the DJ on the radio say's "I took my son in to buy him a new pair of tennis shoes. When I was done he say's they cost a little more than my first car.

Idaho's gun friendly legislation being proposed. I live in Idaho and know the sponsor of the legislation. The next time I talk to him I will share with him that he recieved some favorable attention at this site.
Marius
(03/15/2000; 21:39:57 MDT - Msg ID: 26891)
onlychild: thanks for the reprise!
I heard Mr. Sinclair's piece read over the radio a couple of weeks ago, and regretted not having taped it. Thanks for posting it here. I bet it rubbed a lot of his more self-
righteous countrymen the wrong way!

While the sentiment is touching & much appreciated, we are far too concerned with being liked, and not nearly concerned enough about being either respected or feared. As world banker/policeman we're never going to be liked. Respect and/or fear will suffice in its place.
4Ducat
(03/15/2000; 22:01:39 MDT - Msg ID: 26892)
General Po's Chicken and the Sushi comes with hot mustard
http://www.dailyreckoning.comSo if money is being pulled out of Nasdaq, then I assume it has to go somewhere else. So they think the DOW is undervalued having been beaten up a little. It's a see-saw ride down for both of them. The BOJ is the real wildcard to the POG. Think about this: In every country you have hawks and doves. Or, hard money wants to rule and have military will travel VS the don't rock the boat "our life is business for business" no we don't even want to build a military, let others protect us because it's cheaper. For the last 55 years the doves have roosted in Japan after MacArthur sent Quaker school teachers over after the war to pacify the Japanese. MacArthur was into teaching peace. They were taught peace and it was written into their constitution. So along comes China wanting Taiwan back. Taiwan is the "buffer zone" between China and Japan as the Japanese see it. Japan has no fear as long as Taiwan is free. The Taiwanese already have independence if they can keep their mouths shut but if you have ever watched a session of Taiwan's Parliment in action it is like a cross between TV wrestling and a food fight between well dressed individuals. No they can't keep their mouths shut. So if China takes Taiwan by force with Gore as president (shallow electorate elects shallow prez), we are looking at a real line drawn in the sand. All Asia goes into fight or flight mode. Like a farmer shooting the shotgun off in the barn on a Sunday. Lots of ruffled feathers. Russia and China are talking again and what do you think is the topic of discussion?????? I'll go in the front and attract his attention then you go around the side and swipe the candy. Russia is going to sucker us into some conflict in WhoCaresIstan and China is going to swoop on Taiwan. All our boats are going to be in the wrong lake. Bill Gates bought into Newport News Ship,why? The doves in Japan are being told off right now. The hawk minded old feudal Japanese families that just loved money more than life for half a century don't see this Taiwan game as another round of poker. The economic policy of the doves was working fine before the collapse but just as the buildup before WW2 pulled us out of our depression, the hawks in Japan are saying they want to build an adequate defense against Chinese nukes instead of pump priming. Here is my gold pro question. What will they