Thanks for the Fed link re money supply, though I think you may have missed the increase in M3 (containing euro dollars) with respect to the other measures.
Easy Als' money has been flowing overseas via the current account deficit etc., hence "price stability, low inflation and the goldilocks economy" on this side of the pond.
When these dollars come home to roost (indicated by a decline on the FX markets) the gold bull will be underway in earnest as I understand things.
I agree that the crowing about M1 is misleading as this measure appears to have been shrinking and and doesn't paint the big picture.
The real key though is the strengthening of the Yen over the Greenback. This has turned an acute corner & would be of more pertinance I believe than that of the M1 directly.
Thanks for your post on living through the Depression. Your description is so vivid, I felt I was watching it directly. Such a rooting in reality, however hard and sad, compared with the manifold artificialties today, however pleasant. That is why we welcome your post here, as we try to dig underneath the artificial veneer and brainwashing we are all inveigled by.
It makes me glad to think I'll have your story among my "keepsakes" as I archive another month's post into a Word document for safekeeping.
President Clinton this morning will announce a total
recall by the U.S. Mint of 400 million 25 cent pieces
which feature an armed man on its reverse side.
The quarter was released earlier this year as part
of a 10-year program of commemorating each state's
entry into the Union with a specially designed
reverse side denoting its date of entry and featuring
designs approved by each state and the Mint. Last
year, five quarters were released without controversy.
However, the first quarter in this year's batch,
which honors Massachusetts, has drawn outrage from
children's groups, gun control advocates and others.
The reverse of the Massachusetts quarter features
an engraving of the state with a Minuteman holding a
flintlock rifle embossed over it.
Sarah Brady, outgoing president of Hand Gun Control,
Inc., said she was "livid" and "nearly had a stroke"
the first time she saw the gun-toting man on the
quarter. She said she felt betrayed by the Clinton
administration, which recently renamed the White
House press briefing room in honor of her husband
James Brady, who was grievously wounded by gunfire
in an assassination attempt on President Reagan.
Brady added that the quarter brought back "horrible
memories" of that day.
Sen. Charles Schumer (D-NY) who was promoted to the
Senate two years ago from the House in part for his
staunch gun-control advocacy, said he first saw the
offensive quarter when he was playing "quarters"
with Sen. Kennedy (D-Mass.) at a Capitol Hill
watering hole.
Schumer says he was draining a pint of Rolling Rock
after Kennedy had bounced a quarter into it and
reacted in "horror" when he saw a man with a gun
pointed at him through the bottom of the glass,
causing him to drop it and dive under the table.
Kennedy joined him under the table, thinking
Schumer had a waitress down there. Instead of a
hotty, he found the quarter which frightened his
colleague.
Schumer says they both said at the same time, "That
quarter is dangerous!"
Marianne Wright Edelman, head of the Children's
Defense Fund says she is "upset" and "scared for the
children" who will see the "bad man with a gun" on
the quarter and get the message that "guns are cool."
She says the quarter will undermine years of efforts
to teach children that guns are dangerous and should
only be owned by the government.
A chagrined President Clinton, responding quickly
to head off an election-year snafu that could hurt
his fellow Democrats, ordered every Massachusetts
quarter taken out of circulation and destroyed. A
design to replace the gun-toting militia man has not
been chosen yet.
Since by all accounts Japan is not even joined at the hip of U.S. but rather an appendage of U.S., why is Yen strenghtening so accute? Their fiscal year has just ended and they are moving some paper around. So what. They have no gold,no oil, no resources, and apparently no real plan to extricate their corrupt system out of valueing assets on bank books that no longer exist. I don't understand what fundamental strenght underlies Japan and Yen to see any signifigance to Yen bouncing around. What am I not seeing?
As I read the posts about the depression, I hear all of my grandparents stories echoed. Two have passed recently (age 83 & 88), two are still living (both 86 soon). I am now 40 and I had many good years to absorb their stories. They have taught me to waste nothing. My wife would also throw out a garment with no button, or bread mix with an ant in it. But now she brings her sewing to me, and I would cook the bread mix for my brittany. In fact, my ways of repairing and reusing things have become such a joke with my secretary that she tries to embarass me by bringing me items that she would throw out. No success yet, I've salvaged everything from clothing to electronics. I've worked in the electrical construction industry for twenty years, much of it for the gov't, and believe me I have hauled home alot of valuable material that would have gone in the dumpster.
The lessons of my grandparents have left a permanent mark, I live far beyond the means of an electrician. But it is not by accumulating debt. I only have a mortgage and a Harley payment, both of which could be paid off tomorrow with the yellow metal I have aquired from MK these past few years. I'm financed at under 7%, so I believe it is better to pay a little interest on paper debt and accumulate hard, liquid, mobile assets with the money that I could have instead used to pay down my loans. Besides, I've learned a hard lesson about having your wealth where it can be seen. I was sued in '95 by one of those late night TV "have you been injured?" lawyers. Even though I was not in the wrong, it cost me a bundle to defend myself. The plaintiff saw money and went after it. If I had been apparently mortgaged to the hilt, there would have been no thought of filing a lawsuit. (forgive me for rambling, I'm on heavy medication from a sinus surgery yesterday)
My grandpants grew up much like VanRip, on a farm in a rural area. They all farmed with mules. Grandpa told me just last week of how his dad could plow 40 acres in a day walking behind his team. He said his dad would take quinine to relive his tired legs. They had no phone, no running water, and one light bulb. His mom would render pork fat and lye into soap. They hunted for their meat, that included rabbit, squirrel, raccoon, duck, goose, turtle dove, and plain ole turtle. They lived at the confluence of the Missouri and Grand rivers, so fish of every kind were on the menu too. Honey was had by finding a hive in an old hollow tree and smoking the bees so they wouldn't sting. If the tree was too big to climb, then you had to cut it down to get the honey (that tended to really upset the bees).
Grandpa would go work for other farmers once all of his dad's crops were out of the field. He had five brothers, and they would pick corn for 25 cents a bushel. I remember that he worked for one farmer for 50 cents a day. He was 15 when the depression hit, but he said they didn't notice it much on the farm, nothing from nothing is still nothing. It was the dust bowl that caused more trouble than the depression. Farming got rough, and in 1934 he went to Kansas City to find work. He would get up in the morning and walk all day from business to business trying to find work. He and grandma were newlyweds and they were lucky enough to own a car. Unfortunately, they couldn't afford gas, it was 7 cents a gallon. He finally found work in the steel mill for 27 cents an hour (woohoo, big bucks!). Once he found work he could afford gasoline, so he drove to work. But in the winter they couldn't afford anti-freeze, and multi-viscosity oil was still in the future. So when he came home from work he would drain the water out of the radiator, and if it was really cold he would drain the oil too. Otherwise he could heat the crankcase in the morning with a pan of coals from the stove.
My mom was born in the bedroom at home in 1936. She always wore used clothes, and her idea of a treat was plain puffed rice. Grandma would give her a waxed paper sandwich bag full of them to take out in the yard (for God's sake don't forget to bring the bag back). To this day, when we go hunting together my grandpa saves his sandwich bags to reuse. (We still hunt, and now that he's 85 I can keep up with him) As VanRip said, there was no hot water, you heated it on the stove. You went barefoot at home to save your shoes for school.
My grandma was lucky when the depession hit. The banks limited how much money you could withdraw. But her dad figured out that if you owed someone a debt, the bank would allow you to pay it. So suddenly my Great grandpa Sam owed his brother a bunch of money. They only lost seven dollars when the bank failed. They had all of their cash in paper money when FDR confiscated the gold, so it didn't affect them directly. But they did lose out when he revalued gold later in '33, since all paper lost almost half of it's value.
Grandma grew up much the same way as grandpa, except her dad was a cattle farmer, so she learned to ride at a very tender age. Bare back of course, who could afford a saddle? To this day she still gets teary-eyed talking about her old horse "Clipper". The horse went blind when it was fairly young due to an illness. Great grandpa could still plow with Clipper by hitching her to another horse, but no one could ride her but grandma. Clipper would gallop for grandma. That's trust! In the house where grandma grew up they had electricity, but they made it themselves. They had a wind generator that charged a bank of batteries. They had one of the few radios around, so on saturday everyone would come to their house to listen to the radio. the first radio used headsets, so everyone sat in a circle and shared an earpiece of the several headsets. Later, after the depression they got a larger floor-standing radio with a speaker. Grandma still has it and it is beautiful.
So they all went through some tough times, but it was a tough life already. Most people alive today have not had to live that life. Even our poor have TV, a phone and running water. I am afraid of what will happen next time. Many will turn to crime as a method of supporting their lifestyle. I belive our gov't is afraid too. I believe that is why there is such a push to disarm the public. It's not about safe schools, it's about safe senators and representatives. There was fear of revolt during the 30's, the first world war and the bolshevik revolution was not a distant memory then. If my history is clear, Captain Douglas MacArthur and Lt. Dwight D. Eisenhower opened fire on a group of WWI vets that were marching on DC in an effort to get their pensions. How's that for gratitude?
I hope you're right, I hope it's not too bad. I think the president would love nothing better than to declare martial law and cancel the election. Does this seem familiar? Small-time politician rises to presidency, popularity is high despite many wrongdoings. Creates robust economy from thin air. Wants the public disarmed to make a safer nation. Can you say National Socializm? Guten nacht, OC
Sir VanRip has taken us on a journey through time! I think this story, so beautifully told, deserves a special place here on the forum as it is possible (let's hope not)it may have increasing relevance in the times to come and all will benefit from having the opportunity to review it. Is this not HOF material?
Thank you for retelling your family's Depression memories! There is a lot of wisdom in the things you said. I loved the line, "it's not about safe schools, it's about safe senators and representatives!"
RossL, did you write that great news story yourself? You got at least one victim this morning!
It could be possible under extenuating circumstances to transfer the assets of a 401K plan to an IRA. Once the funds are in the IRA they can be extracted as early distribution. All the money that is basis becomes taxable as income when removed from the IRA since it was not taxed when it was put in. The balance is taxable as capital gains. There is also a 10% early distribution penalty. In some circumstances the penalty can be avoided. Each circumstance is different. perhaps you did want to go back to school to finish that degree?
Years ago ('94) when I exited the last mutual fund I ever owned (save Tocqueville Gold IRA), I received a letter saying that I could return the redeemed money to the fund without losing my original share position for up to 90 days following the withdrawal. The way I read it, it meant they would not charge me a re-admission fee if I just sent the money back within 90 days. I presume the 90 day limitation has some significance or did back then. Perhaps that is when redemptions have to be booked. That would mean mutual funds may have a 90 day window to make adjustments for redemptions and do not have to actually sell any assets until 90 days after the redemption event. I ask you now, what happened about 90 days ago? The beginning of January 2000 saw a 500 point drop in the NASDAQ 100 and a 500 point drop in the DJIA. The ninety day reconciliation period for these fall offs are due. Perhaps some funds began early (before the end of March rush). But it doesn't end there. There were also Y2K withdrawals to unravel. What we saw last week could have been only the withdrawals of people redeeming in late December that didn't jump back in the second week of January. The January blips in turn were harmonic aftershocks from the late September '99 redemptions. If you view the DJIA the September decline was small compared to the January decline and the March decline has I think yet to gain momentum.
The New U.S. Dollar Coin --- Manganese, Brass and Copper
Well, I suppose it's a step in the right direction. At
least it has some metallic value.
When the US Mint wanted to wean 275 million citizens
from the most popular bank note in history to a coin with a
bad reputation, it turned to a retail chain.
Wal-Mart, the largest retailer on Earth, has become the
first point-of-call for America's new "golden dollar" in a
marketing move that flouted the US monetary system and
became a case study in how to sell money.
After examining focus group research, Mint director Mr
Philip Diehl launched the new coin in January.
Now, there is a US$40 million television, radio and print
advertising campaign underway designed to overcome the
resistance of the most likely users: city-dwellers aged
18-49.
The last attempt at issuing a dollar coin failed. Very few
retailers used it and the public remained dedicated to the
greenback. "Americans are particularly conservative in
their habits with currency," Mint spokesman Mr Michael
White said yesterday.
"They like the dollar note. They don't want to give it up."
So the US Mint turned to one of the things the nation does
best - marketing.
Free coins were hidden in breakfast cereal and
promotional flyers sent to 90 million homes near Wal-Mart
stores, with the Mint shipping out coins itself for the first
time. (Normally, the Federal Reserve distributes new
cash.)
The impact was immediate. People flocked to collect the
golden-coloured coin carrying an image of Sacagawea, a
Native American woman who guided explorers
Merriwether Lewis and William Clark across America in
the early 1800s.
But Wal-Mart's early access angered the American
Bankers Association, which said many rural banks had
been embarrassed by their inability to supply customers
with the new coins. A Montana congressman,
Representative Ike Skelton, accused Washington of
favouring big business.
The controversy only increased demand for the coin, as
widespread media coverage created a sense of scarcity.
The Mint made special direct shipments to community
banks, credit unions and building societies, and set up an
internet ordering system for financial institutions. "We
couldn't have purchased the amount of public relations we
got," Mr White said.
In the two months since launching the coin the Mint has
already hailed it a success, with more than 344 million
coins issued. Circulation is expected to hit 500 million by
the end of next month.
The exercise will be lucrative for the Government's
coffers.
The manganese, brass and copper coin costs US12�
(19.5�) to produce and has a 30 year lifespan, compared
with 4� dollar notes which have to be replaced every 18
months.
But the motivation was economic. The dollar note is not
suited to vending machines, and a more machine-friendly
currency is seen as promoting consumption.
And having made his contribution to numismatics, Mr
Diehl yesterday announced he was leaving the Mint to
head of an online jewellery site based in Texas,
[A well written article. Thanks to THE AUSTRALIAN
FINANCIAL REVIEW, Fair Use For Educational/Research
Purposes Only.]
@ Oldgold MSG 227869
Sir Oldgold - in your above message you stipulated that
it is the ECB and Euro CB's leasing "all" that gold. Please let me, as one of the few Continentals on this board remind you, that the Washington Accord expressively stated, that all signatories will also refrain from leasing,
forward sales and other futures instruments regarding the gold they hold, as well as limiting total sales for 5 years to 2.000 tons, or max. 400t/a.
This amount is more or less spoken for:
Bof Switzerland: 1.300t
Netherlands: 300t
UK: 415t* (WA came after 2nd. sale of 25t each - so there may be 35t not accounted for up to now).
No further surprises to be expected from this front, though I'm discounting French nonsense, which was instantly
denied by the BofF.
While, I'm not saying it wasn't done - Gold Leasing from
EU CB's was never a big issue, though Deutsche Morgan Grenfell and UBS may have been perpetrators in this context, the major NY money center and BB's are the more likely targets for your accusations. Sir, please ask yourself, who their lenders of last (gold) resort may have been?
CB2
You said:
@ Oldgold MSG 227869
Sir Oldgold - in your above message you stipulated that
it is the ECB and Euro CB's leasing "all" that gold. Please let me, as one of the few Continentals on this board remind you, that the Washington Accord expressively stated, that all signatories will also refrain from leasing,
forward sales and other futures instruments regarding the gold they hold, as well as limiting total sales for 5 years to 2.000 tons, or max. 400t/a.
***************
We all need a reminder of this from time to time, yes? The world of gold finance has fundamentally changed. But again, the question floating in the back of my mind comes to the fore, that although the Euro CBs as signatories to the Washington Agreement may hold true to this policy, Europe is not the whole rest of the world in terms of CBs with gold reserves available (?) for leasing. We have been pondering these last months the source of physical being dumped on the market - whether it be sourced from foreign European reserves held (not yet repatriated) in the US (which could be being leased), or supplies draining illegally from Fort Knox. But what we do not know is the position on other foreign banks (Kuwait comes to mind)in the whole rest of the world and whether they are leasing.
An answer to this would be much appreciated.
Just a short note on your response - will try to get to the
bones later.
I subscribe to A/FOA's US$/IMF faction vs Euro/BIS faction
and find it more accurate by the day, judging from the events we're all witnessing as they unfold.
I will have to respond later, since we have guests for dinner.
This has got to be the most absurd lunacy to date. I can't believe that these are real people allowed to even walk the streets much less be part of Advise, Consent and Govern.
We probably haven't heard from SteveH this morning because he broke his typing hand when he put his fist through the wall!
So far, nothing shows on Urbanlegend.com or urbanmyth.com
True, false or distorted, the intent is clear in the ****statement.
Marianne Wright Edelman, head of the Children's
Defense Fund says she is "upset" and "scared for the
children" who will see the "bad man with a gun" on
the quarter and get the message that "guns are cool."
She says ******* the quarter will undermine years of efforts
to teach children that guns are dangerous and should
only be owned by the government.***********
When did the Minuteman, the symbol of the American Revolution, become "The bad man with the gun."
When we were kids we sold 25 cent defense stamps to finance the War; they had that Minuteman as their graphic. That would really give these sickos a coronary!
I have been I bit blase' regarding the alleged attempt to disarm and takeover control of the people. But this scares me!
Peter, don't feel too bad about being zinged an april 1. It's a good thing I finished the article and saw the date at the bottom. I thought it was all over, I was ready to head for the bunker.
http://www.usagold.comGreat idea!Guns should only be owned by the Government. Hitler thought the same thing.Try telling that to the Swiss, Marianne. Geez. I guess George Washington should have used moral suasion instead of guns to get the British out of the colonies.
The signatories to this agreement have agreed not to expand their gold leasing and their use of gold futures and options over this period.
The words used are not totally clear on whether gold leasing is to be frozen at current levels, or whether some leeway will be allowed as long as the total at the end of the period equals that at present.
end quote
I think it is a bit misleading to say "that all signatories will also refrain from leasing". It is obvious that they are still leasing, they are just not expanding their leases. I agree with oldgold that they certainly have it in their power to end the bear market by announcing a reduction from their current level of leasing. They could be choosing not to do so for many reasons. I imagine that such an announcement would not ultimately get them much of their gold back, but this really makes me wonder how do they expect to get it back?
Thank you for your response to my e-mail although I notice the same reply was circulating in the gold chat rooms, so I consider it not just a thoughtful response to me. Rather, it appears to be another general reply generated by your shareholder relations department in defence of your outmoded premium hedging program, at a time when the price of gold equals the cost of production to producers.
I have to congratulate you for building a strong solid company with excellent management, and for creating a very innovative premium hedging strategy in the first stages of development of the company. BUT THAT WAS THEN. You are now a mature company with a great deal of influence in the industry that allows you to grow and prosper. You must not sell your industry short!! The gold market was a relatively healthy industry then, and you could not afford to jeopardize shareholder investment at that time. You are NOW one of the strongest in the industry, with low cost production and a strong balance sheet, and you can again show leadership.
YOU need to send the message that :
1. Speculation in the gold market will be not be tolerated in order to bring the price down to satisfy a chosen few who lease gold at 1% and then invest in paper at 6 % at the same time severely depressing the gold market. This game is getting old, and everyone is aware of it but no one is doing anything about it, including you. But, of course, you are also a participant.
2. Gold is not only a material to produce jewellery but a monetary instrument which has held value for ages. Your CEO knows that, and I know that. We both have Eastern European backgrounds and both know what happened to our old currencies in the time of excessive monetary expansion. The currencies lost 1000% to 10000% depending on which country you look at.
3. By paying an $85M premium for 6.8M ozs of gold call options, you did not do shareholders any favour. By your own admission you are realizing $100/oz over the market price. Simply calculate this and you have $680M additional revenue by buying and delivering gold without spending $85 million in this paper game. Also, this sends a signal to the market that shorting the gold market is unprofitable. Ask your shareholders what they would prefer! In the case of any excessive selling by central banks (who now sell only 400T a year) production could always be cut, and company resources would not be depleted at this ridiculously low price.
4. Investing in a gold producer is investing in gold. Investing in a hedge fund is for the derivative players, not the gold investor. The market recognizes this and that is why the shares of Barrick have been in a steady decline for the last five years, hitting another low this past Friday. Surely you are aware of this. After Placer Dome made an announcement that they were curtailing their hedging activities the momentum was there. You had a chance to bring an end to this abusive derivatives scam which is destroying the entire gold industry. And what did you do? You supported this debacle by adding more derivatives to the existing ones.
I will never invest in Barrick under the present circumstances because investing in Barrick is supporting a derivatives madness that has only been negative for the gold industry. Perhaps it is time for your executive to rethink their strategy. Hubris will have to take a back seat. The ball is in your court and you must take the initiative and make a VERY STRONG STATEMENT and send a VERY STRONG SIGNAL that you intend to take control as a leader, and that you have faith in your own industry.
Unfortunately, the same people who rely on a viable prosperous gold industry have created this problem. Please do not waste any more of your shareholder's money lecturing them on the so-called benefits of this derivatives scheme. It is destroying the gold industry, but I don't think it is too late to reverse the course.
Just a short info packet to Canuck. Silver rounds may be available in some small quantity in Canada. Coin dealers who also have a small market for selling bullion and who travel in the US on a selling tour may pick these up. They do not have the same premium added on cost to the consumer, but are in all ways just as good in metal and weight as coin.
Many come as "wafer" style too and all have some special occasion embossing, with "happy birthday", "Merry Christmas", "Happy Easter" and the like. As such they are date embossed and can be had at a considerable discount - down to 10 - 15 % over spot (usually the next month's future spot)- and I recommend them over Maples etc.
Easter is coming. More of these will be hitting the market soon. Outdated, but still tasty.
Re: Washington Accord: Your WGC quote is exactly correct:
Here is the full text of Sept. 26 1999, though I didn't want to restart this discussion.
Joint Statement on gold
European Central Bank
Oesterreichische Nationalbank
Banque Nationale de Belgique
Suomen Pannki - (Finland)
Banque de France - forget any ideas for 5 years
Deutsche Bundesbank
Central Bank of IrelandBanca d'Italia
Banque centrale de Luxembourg
De Nederlandsche Bank
Banco de Portugal
Banco de Espana
Sveriges Riksbaank
Schweizerische Nationalbaank
Bank of England
In the interest of clarifying their intentions with respect to their gold holdings, the undersigned institutions make the following statement:
1. Gold will remain an important element of global monetary reserves.
2. The undersigned institutions will not enter the market as sellers, with the exception of already decided sales.
3. The gold sales already decided will be achieved thtough a concerted programme of sales over the next five years. Annual sales will not exceed approximately 400 tons and total sales over this period will not exceed 2.000 tons.
**** 4. The signatories to this agreement have agreed not to expand their gold leasings and their use of gold futures and options over this period.****
5. This agreement will be reviewed after five years.
This is the official text of the agreement by the 15 signatories on Sept. 26 1999.
* IMHO - true we don't exactly know the extend of EU-CB gold leasing, the indications point to an average of below 10% -that would mean about 1.200 tons, which again would only account for max 10% of the alleged short position on physical, though the combined holdings of above signatories
equate to about 1/3 of total official sector gold holdings- if it's still there, which was your prime question! - All I can say is that the EU CB's have been accounted for their resereve holdings independently - otherwise not one of the common currency members would have accepted a party to the system, which would or could not prove the reliability of their accounting to the rest of the "gang".
So why does the US not comply to prove their reserves of gold (which, BTW are the only true exchange reserves the country may have, since they can print the same in paper, paupering the rest of the world for a while, but not forever), which may be a moot thought after experiencing the US$ defaulting in the "NEW DEAL" internally and in the Nixon default 1971.
From here on the FIAT $ has lost all relation to real money and became a symbol of extortion, blackmail and in the end serfdom. The extreme counterproductive ends the US $ was never, ever designed for.
And that may be why some of your great men wanted to install -GOLD- as the only true measure for countervalue and reality.
...
OK, again 14 EU CB's and the ECB agreed not to sell more gold than the already designated 2.000 tons over 5 years - 1.300 tons coming from the Swiss CB alone -and I don't even want to go into details as how the Swiss have been "persuaded" to part with a major part of their national inheritance, though I feel you all know by now.
My Letter to Barrick Gold - Taking the Intellectual Approach
Ms. Mulligan:
Barrick Gold is NEXT! (Note Paragraph Three)
Close your F**king hedges NOW!
David Cohen
------------------
Fraud Lawsuit Filed on Behalf
of Purchasers of Ashanti
Goldfields Company Limited,
Inc. Common Stock
LITTLE ROCK, Ark., March 27 /PRNewswire/ -- The following is an
announcement by the
Law Offices of Steven E. Cauley, P.A:
The Law Offices of Steven E. Cauley, P.A. announced today that a class
action lawsuit has been
filed in the United States District Court for the Eastern District of
New York on behalf of all
persons who purchased the common stock of Ashanti Goldfields Company
Limited, Inc.
(NYSE: ASL - news; ``Ashanti'' or the ``Company'') between July 28,
1999, and October 5,
1999, inclusive (the ``Class Period).
The complaint charges Ashanti and certain of its senior officers with
violations of the Securities
Exchange Act of 1934. The complaint alleges that defendants issued a
series of materially false
and misleading statements concerning the Company's hedging strategy,
ostensibly designed to
protect Ashanti against fluctuations in the price of gold. The complaint
further alleges that
defendants' statements during the Class Period misrepresented and
concealed the true risks
present in the Company's hedge book and concealed the Company's exposure
to the volatility in
the price of gold. On October 5, 1999, the complaint alleges, Ashanti
announced that its hedge
book had turned ``negative'' by over $450 million and that the Company
would be required to
meet massive margin calls which it did not have the capital to meet. In
response to the
Company's belated disclosures the price of Ashanti common stock fell
over 56% to close at
$4.125 per share on October 6, 1999.
The Law Offices of Steven E. Cauley have substantial experience in
prosecuting class action
lawsuits on behalf of investors, and recently obtained a $25 million
settlement for certain
purchasers of Medpartners securities. If you wish to serve as one of the
lead plaintiffs in this
lawsuit you must file the appropriate motion with the court no later
than sixty days from
February 3, 2000. If you have any questions regarding this lawsuit or
how you may be able to
recover for the losses you have incurred, please E-mail or call:
LAW OFFICES OF STEVEN E. CAULEY, P.A.
11311 Arcade Drive, Suite 201
Little Rock, AR 72212
E-mail: CauleyPA@aol.com
1-888-551-9944 - toll free
Gold Prices Seen Lower as Switzerland Prepares to Sell
Reserves
�
Bloomberg News
Mar 31 2000 6:30PM
�
New York, March 31 (Bloomberg) -- Gold prices could fall in coming days, extending a
seven-week slide, on concern that sales of bullion by central banks will overwhelm
demand from investors and manufacturers.
(Well, at least, that's the message we've been told to print by the guys at Goldman and Chase. Gawd, they sure know how to bribe a news organization!)
Switzerland this spring is expected to begin a five-year program to sell 1,300 metric tons
of gold.
(Of course, you've all known this for almost three years now since we've informed you almost every second week at least a hundred times of the impending sale. The current dismal low gold price reflects that fact. You know, "sell on the expectation, buy on the news" is the way the markets "normally" work...except the gold market, which we have screwed up so badly that it is now "sell on the expectation, sell on the news." It's always, SELL, SELL, SELL!)
The Swiss central bank is one of 15 European banks that agreed last year to
limit gold sales to a combined total of 2,000 tons during that period. While the agreement
bolstered prices briefly last year, expectations of weak demand for the gold sent prices
tumbling this year.
(Of course, there is almost always another central bank to buy these central gold sales but we conveniently never mention that point of info since we are scaremongers committed to making people believe that all these gold sales hit the street. Basically, we like talking about gold sales, HATE to suggest who might be PURCHASING the gold. Oh, what dirty rotten scamsters we are!).
``The fear of central bank sales is overhanging the market,'' said Donald Eckert, head of
precious metals trading at Chase Manhattan Bank in New York.
(Holy shit, we hope you swallow this load of unmitigated BS. After all, these bullion banks are sitting here with tons of gold shorts and you better believe there's fear out there. When some savvy shrewd central bank or smart billionaire starts to buy gold and demand physical, Chase Manhattan is screwed, blued, and tatooed. The fat greedy pig-f*king execs will have to place their country estates up for sale and see if somebody'll hire them in Korea or some Godforsaken country like that).
The Bridge-Commodity Research Bureau index rose 1.78 this week to 214.37. The
Goldman-Sachs Commodity Index, which is weighted toward energy markets, fell 2.45
to 206.88.
For the week, gold for June delivery fell $6.50, or 2.2 percent, to $281.40 an ounce on
the Comex division of the New York Mercantile Exchange. It was the sixth drop in
seven weeks, leaving prices down 12 percent from a four-month high on Feb. 10.
``We are seeing demand at the $270 to $275 level, but there still seems to be selling
above that,'' which will send prices lower, Eckert said.
(Yeah, Chase is selling the crap out of gold, it's called NAKED gold shorts, and the day some shrewd central banks or savvy billionaires start demanding physical gold in abundance, they are screwed, blued and tatooed!)
Swiss voters last year approved a constitutional amendment severing the 100-year link
between the franc and gold, clearing the way for the central bank to begin selling bullion
from its reserve. Legislation authorizing the sales takes effect this spring.
(Actually, the gold-franc link was severed many years ago, but we don't believe in providing truth where BS and egregious lies work so much better. After all, our aim here is to scare the crap out of gold investors in order to drop the price, NOT to do anything like provide enlightenment that will move the price higher and endanger the bullion bankers' multi-million dollar country estates. So long as contrarians don't like gold, they'll place their money in bonds, which is where it belongs. OH, what dirty rotten scamsters we are!).
``The thinking is the Swiss will start selling in May,'' said Carlos Perez-Santalla,
president of Hudson River Futures in New York.
(At least, that's the BB boys' thinking and most earnest prayer. After all, if the Swiss ever put 2 and 2 together and realize it equals 4, then they might also realize that their government and bankers are about to sell the country down the river for the sake of protecting their banks' and American banks' various gold short positions...and that in selling their gold, they will trash their currency just as happened to the Canuck buck and the Aussie Dollar...then they would cancel their gold sale in a hearbeat. After all, why would any rational international investor want to hold their money in Swiss Francs any longer if it is nothing more than any old average trash fiat currency?)
The Swiss sales come as the Bank of England proceeds with a series of auctions aimed
at selling a total of 415 tons of bullion over several years. The Netherlands plans to sell
300 tons over five years.
(Of course, we don't want to let you know that the Netherlands completed most of their gold sales already. We much rather you think that is still a FUTURE sale than a realized one. Also, we would hate to inform you that the Bank of England gold sales have been conducted to obtain the LOWEST POSSIBLE PRICE, once again in order to protect a variety of gold shorting bullion banks that own the Prime Minister of England's corrupt ass).
At its most recent auction of gold, on March 21, the Bank of England sold about 25 tons
at $285.25 an ounce, $1.50 below the price just before the auction started, a reflection of
weak demand.
(Or maybe a reflection of the fact that the bullion banks ran the gold price up just before the auction to a level higher than the already pre-arranged winning LOWEST POSSIBLE BID gold price at the auction, thus making it appear as though the gold price weakened during the auction. OH, what dirty rotten scamsters we are!).
Bids were submitted for 75 tons, compared with offers for 107 tons at
the previous sale in January, the bank said.
(Of course, once again, we would hate to note that in both cases, the offers reflected OVER-subscription of the physical gold amount offered, that would not be keeping with the overtly biased anti-gold nature of this press release whereby we are trying to create the impression nobody wants gold anymore. OH, what dirty rotten scamsters we are!).
Gold has lost about a third of its value since 1996, partly because of concern over central
bank sales.
(Actually, gold has lost a third of its value since '96 because the Western financial Establishment is selling off its repositories of gold primarily to Eastern central banks (see WGC reports on CB inventories) in order to raise desperately needed funds for maintaining stock/bond market verticalities, a strong US Dollar, and to save failing government social programs. Oh...and of course (hate to forget!), most importantly, gold sales protect the enormous gold short positions of the major US bullion banks. However, thanks to obedient media bullhorns like Bloomberg, we are able to scare the Western public into believing that gold holds little value today. Aren't we dirty rotten little scamsters?)
I too am in the FOA/Trail Guide/Cobra(too)camp vis-a-vis the BIS vis IMF war of currencies. The problem is clear in all this at least, that there is still leasing going on. But the source of the liguidity is not known - we only surmise that it is either from other CBs not signatories of the Washington Agreement, from signatories of the Washington Agreement who are leasing in defiance of their own policy, or from US sources (nefarious).
If the leasing liquidity is from the ECB camp, why would they do this? The easiest explanation IMHO is to stall off a gold explosion that would create havoc in all economies still "served" by the dollar as the world reserve currency. Of course this means ALL economies. One is reminded that the EURO is not yet a floating entity, and the EU is IMO not ready for open fiscal warfare with the US camp. One would be inclined to wonder if there is a wish to avoid the hazard of a fiscal miscarrage, if I could use this image, by premature provacation. Also, could the ECBs be "playing" the gold market and possibly picking up gold at bargain prices through buying intermediaries? So the capping campaign could be going on from both sides, as for now it would be in everyone's interest to maintain a low gold price to protect the US dollar. I am not a fiscal expert (can't you tell?), but this could be what is going on. And yes, the BIS could end this at any time - but chooses not to.
I believe that the BIS camp recognizes the fiscal value of having gold as a support to their EURO. (The importance to the ME would seem obvious to all.) If the dollar camp can keep their hyperactive and debt inflated economy afloat until the EURO is substantial, then it is to the benefit of all (including we lowly gold bugs) for them to do so. I do not feel that the EURO camp would want to rock this US Titanic - it has already encountered its iceberg and will subside without any help from outsiders. The BIS certainly knows this.
Really what I was after in my earlier question was any glimmer of information from others about other sources of leasing liquidity. What other CBs in the world could be involved in letting metal into the market in this form?
Leigh - Greeting's/PTL - In my humble opinion...after the election. I can't see Buba & the avenues of influence under his control ruining the D's chances of getting back in for another term. Look for status quo until after the election & then hang on.
At least two television news crews were dispatched after a news release sent to the local media stated than an April Fools' Day parade would begin at 59th Street and march down Fifth Avenue, starting at noon.
Crews from CNN and the Fox affiliate WNYW duly arrived at noon, only to find the usual parade of people and traffic. <<<<<
Robin's comment just now. (She's HS class of '65) "I knew there would be trouble when all those kids I went to school with, got old enough to run the world."
Reginald H. Howe, proprietor of www.GoldenSextant.com
and the analyst on whom GATA has relied so much to
explain government's likely relation to gold trading and the
details of gold banking, provides below elaboration on
exactly how the U.S. Treasury Department's Exchange
Stabilization Fund may be suppressing the price of gold
by selling calls.
Howe's scenario fits everything GATA has seen in the
last year, and if it is correct, it also explains how certain
bullion banks always seem to know exactly where the
gold price is going to go and where it will stop and
reverse. They know because they are handling the U.S.
government's own orders to sell calls, and, knowing that,
they have, in effect, a license to print money -- or, rather,
to steal it.
What Howe writes below is the ball game, people. This
is very likely exactly how the grand scheme against
gold has been working. So please keep this on hand for
future reference and publicize it all you can.
U.S. members, please send this to your congressmen as
well and ask them to determine for you authoritatively
whether what Howe describes is happening. And everyone,
please post this as seems useful.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
HOW THE ESF MAY BE SELLING GOLD CALLS
AND HOW THAT PUTS GOLD INTO THE MARKET
By Reginald H. Howe
www.GoldenSextant.com
April 1, 2000
While it is possible that the Exchange Stabilization
Fund has sold gold calls on the COMEX, I would expect
that to be a relatively minor activity. The calls to
focus on are over-the-counter calls written to bullion
banks to facilitate their gold loans or other gold
products designed to pressure the gold price.
Of course it is possible that the ESF has borrowed gold
for direct sale or to make gold loans to others. But
far more likely, in my view, the bullion bank borrows
the gold from a central bank, sells or loans it to a
client (for sale), and simultaneously hedges the
repayment obligation -- its own, its client's, or both
-- by purchasing calls.
As outstanding gold loans expand, the risk of selling
protective calls increases, and the ESF must step in as
others withdraw from this market.
Or, to take another example, while Barrick Gold said
recently that it had purchased its gold calls from
bullion banks, the bullion banks must have hedged their
exposure somehow. Under the circumstances, it is hard
to see how they could do this other than by purchasing
calls from a motivated seller with deep pockets and
high tolerance for risk.
I doubt that the ESF would risk having much in the way
of direct relationships with outsiders, even other
central banks, so I would expect its activities to be
camouflage through one or a very few big bullion banks.
Writing calls is an efficient way to underwrite all
manner of short-selling activities by bullion banks,
leaving them free to handle the details.
Turning to the questions that should now be asked of
the government, I was trying in my March 28 commentary
to keep them short and simple. To my mind, "trading,
directly or indirectly ... in gold or gold derivatives"
includes borrowing gold and selling or relending it.
However, one certainly could add to the "including but
not limited to" clause: "or participating in any way in
making gold loans."
T.C repost. Maybe everyone should read this again...
My jaw dropped when I read this the other day. I reposted it on Kitco and got a few responses, but there too they did not seem to get it. Everybone on both forums just seemed to pass it by that day and I did not want to repost on April Fools. So I do so now. Please read and ponder the meaning of these words....
************(snip)*******
TownCrier (03/31/00; 15:04:12MDT - Msg ID:27856)
Laying claim to the gold...no small thing here
This being first notice day for delivery intentions on the active April gold futures contract traded on the New York Mercantile's COMEX division, the longs came out in force in preference for physical settlement rather than cash.
Precisely 7,743 contracts (of approx 100 troy ounces apiece) were held up for delivery by the end of April. This entails the shifting ownership of 774,300 ounces...or 24 tonnes. And we've only just begun. When the trading day began, there were over 10,000 April contracts in open interest, so this number is sure to swell somewhat as the month progresses.
Walking away with a substantial portion of this gold so far is Deutsche Bank (2,542 contracts) and Cargill (2,130 contracts).
Just thought you might like to know
*****************************
Tiger may just be making a bigger splash than one might think, yes? Does anyone remember that TOCOM thingy? You know, the one about palladium?
Hipplebeck, in your post Msg ID:27327 you stated that very, very few people have ever handled a real gold coin.
A statistic used in the retail coin selling industry is that 97% of the American people have never held a gold coin in their hand in their life. I think that is close to true.
If this is the case then less than 3% could own gold coins, probably less than 2%. If just another 3% of the people started to buy gold US sales could double. We GOLDHEARTS are really in the minority and the market is truly very thin.
Another thought. If $25 per week or $100 per month in unexpected expenses were added to every household budget in America, how would this affect retail sales in all product categories? What other areas would it affect?
Fuel prices have captured a huge portion of all budgets. Many changes will have to come. Its a law. View
Yesterday's Discussion.
If these delivery intentions are correct, this is exactly the beginning set-off of what F.O.A. says in the latest Trail Walk. "Understand that the largest gold rush will be
from the paper gold arena into real gold".
These delivery intentions appear astounding. I have searched around various net venues and I can find no mention of this. How could this be so? Where is this delivery intention information available?
Tell me if I am mad or just imagining things ?. I frequent a certain bullion dealer occasionally and notice that prior to and consumately when the price of any one of the main four precious metals is about to or likely to increase/spike the array of saleable goods on show changes in the display cases seemingly consistant with the graphs. I mean the larger ingots and bullion coins of either or any of the above foursaid vanish from direct view from the general public.
Palladium had gone for ages , next was Platinum and now except for the items holding a high premium/weight ratio , the investment Gold coins have vanished, yes indeedy even down to the 5oz Au bars now and actual factual the 250 ounce Silver bars have vanished from view as well just recently.
Personally I dont bother with the celebration/commemorative fancy hype coins ; to me its akin to a teenagers fad of paying $20.00 instead of 2.00 for the exact same cheap hat except it got a marketeer's name on it nor am I much interested in the under 2 oz-zies unless its for gifts.
The time frame of Platinum and it rise and dissapearance from shelves was a couple of months shortly after Palladium. I notice that when they vanish they can be purchased over the counter for awhile but after that the feedback is we havnt any of the larger ones left in stock. That may simply well be.
Immmmmmmmmmmm at least to me it seems interestingly peculiar
enough to arounse my curiousity to a vague suspicion regarding this discursive correlation. Any comments on this brothers and sisters, or is this another delusionary symptom of Gold fever ?. Warm regards ! :).
It seems the more one thinks one knows about gold market, the more confusing it becomes. Several weeks ago Dealers here in U.S. were only buying coins back for under spot because of a so-called glut. Yet gold is being exported out of here in substatial amounts, and its not been made clear where its coming from. I guess all you can really know for sure is that which is in your oun hands.
And this just in from my morning newspaper. The Raleigh News@Observer Business section includes a section from the Wall Street Journal every Sunday. Here I found an article, "Safe Havens are Hard to Find." , by Karen Hube The half-page article begins "The hair-raising swings in the stock market recently are prompting many investors to look for ways to protect their assets." blah, blah, blah. Then, "So consider ALL [my caps] options carefully." Then ALL options are listed - "Money-market funds, Six-month CDs, Short-term bond funds, One-year Treasurys, Municipal bonds, and Stable-value funds."
No mention of gold...what a shame. I think I will try to email Ms Hube and inquire as to why she doesn't think gold is a "Safe Haven."
Nice to meet you Hi-Hat. Gee I didnt know that they could do that , i.e buy back under spot ! that is assuming that they the dealer is alledgeing this with facts to back statements like that up ?. Some time back I bought Palladium when it was cheap just before the first spike at the very time it peaked out I went down to sell it off and the responce was that they the staff were under instructions not to buy it. ( dispite it showing up on there buy/sell electronic board.) Nevertheless after abit of arm twisting I managed to obtain a committment that they would buy it back that next day so the next morning I wandered down and reminding them of there promise managed to hoc it off at a handsome profit.
I agree with you Hi-Hat , The solid AU in the hand is what counts ( or kept under me hat )because , re TOCOM and that dirty piece of work re: freezing the Palladium just recently etc it seems ever more and more apparant that the bullion dealers around the traps hand-shakes are dubious contracts.
I will eat My-Hat if I see Palladium at those prices again
Hi-Hat and I will be buying it en-masse if it does and this particular bunch of Criminals on the other side of the law can shovel it. I wonder if there is a message in Palladium for Gold ?. smiles !.
Most of the positions represented by the open interest on the COMEX will be closed out for cash settlement or rolled over to a later month. Declaring intent for delivery on "first notice day" can for the most part be viewed as a bluff in a big poker game. What matters is how many and who holds the contracts open at the end of the trading month. For example, Monday I could go long for a 100 oz. contract and declare intent to take delivery. If I close out the position in a week, then my declared intent is meaningless.
Thanks for your knowledge of the situation. The possability still remains that maybe Deustch Bank and Cargill are bluffing and maybe they are not. We may be at the point certain big players are going to jump ship. The first ones to do so have first legal claim on physical delivery of comex stocks before Force Majoreur.
@RossL and HI-Hat also an interesting repost from rhody at Kitco
Thank you sirs for contributing the comments on the Towne Crier repost. My learning curve continues in the up channel.
I suppose the bluff will not be a bluf at some point and chaos will reign. On this very subject I submit a repost from my twin spirit over on Kitco. There was little response from the day-trader element, and he felt that the matter would be better fodder for a muse on this worthy forum. I agree (and will continue to pester him to join these exaulted ranks on USAGOLD)....
**********(snip)*******(splat)******
Date: Sun Apr 02 2000 09:26
rhody (WHEN WILL THIS GOLD BEAR END? ANSWER: WITH THE DEMISE OF PAPER GOLD.) ID#410367:
Copyright � 1999 rhody/Kitco Inc. All rights reserved
So when will that be?
If you go to http://www.lbma.org.uk/clearing_charts.htm you
will find graphs of number of daily transfers of gold and silver in both paper and M oz of gold. By extrapolation of the channels produced, the downward trend lines end ( dead market ) in May, 2002 for the paper transfers ( paper gold market ) and Dec, 2004 for physical transfers in M oz daily. There is about a year and a half difference between the two projections, so which one is the more accurate in projecting a dead market in gold? I think the answer must be death of the paper transfers, as it is the paper market which is the main mechanism in the downward manipulation of the gold price. If you compare the two graphs, you will find that there is about 30 oz of paper gold traded
for every oz of physical. This meaans that some ( about 3% ) of this paper trading must be rationalized by a real transfer for this this market to continue. On a ratio of one for 30, this market will die in 2002 because there will be insufficient physical gold to maintain this ratio. So in about one year, paper gold must die on the LBMA, and I predict the LBMA will do a TOCOM on gold like TOCOM imposed on palladium.
The problem here is that doing a TOCOM on gold will violate
the Jamaica Accord of cheap oil for cheap gold. FWIW and
would someone else please look at these graphs and tell me I'm wrong because these figures indicate my pension self destructs in 2002.
Interesting observations on First Notice which just occured.
What would be the ramifications if all the little guys, ie. "me" and the other Merry Pranksters, anounced and decided to take delivery of physical? Could this be the monkey wrench to queer the gears of Da Boyz? Just a lazy Sunday thought.
Yes, they would take notice, but there would have to be an Army of us. Each contract is for a 100 ozs.. At Friday close each contract was priced at $274.40. Therefore to take delivery of 1 contract you need to come up with $27,840.00. Last figures I could find showed Comex stocks at about 2,000,000, ozs. So as you can see us little guys are the Monkeys in the futures game.
Deustch Bank or Cargill however would have no problem swinging the bat if the time came.
Cargill having these many contracts on gold intrigued me so I did a little research on them. They are the largest privately held corporation in the United States. I thought they only "did" agricultural products but apparently they play in gold too. One thing interesting about them is that they have an arm of themselves called Cargill AIF, {Asset Investment & Finance Group}. This Group will act as Agent for and take clients in as a partner too, according to their web page spiel, "AIF will provide liquidity for a wide variety of transaction types and assets including assets requireing a high level of due dilegence to determine value or excessive management attention to realize that value". Cargill giving delivery intentions on way over 2000 contracts in the Comex cesspool would call for this type of service. One other interesting thing is that april 00 open interest is a little over 10,000 contracts , while may 00 is so far only...1....BUT june 00 is at 78,000+. So June is shaping up to be some kind of Battleground.
Yes, the paltry open interest of forward months is evidence that the call for delivery is real. This is because most gold in the marketplace, real or imagined, is "rolled over into the new contract months. When such large deliveries are called for, the "roll" can't happen. If it is a bluff, the open interest pick-up will be the first clue.
Would anyone like to second Harley Davidson's and my suggestion that the Hall of Fame open a section for posters' memories of the Great Depression? (That is, if MK and Town Crier agree.) We've had some fantastic posts lately from IronHead, onlychild, VanRip, and others. Thanks!
Last night Bill Murphy was walking home from a restaurant, and a mysterious assailant punched him on the side of the face. He said he doesn't think his jaw is broken, but he is badly bruised and is having trouble talking. Just four or five weeks ago Bill's car was stolen from outside his home. Hmmm.....
If the Comex pantry only has 2 mil ounces- that equals about 20,000 contracts,no? Surely we can muster via the web a few friends, (I'm good for 1 contract- divided by 5 cohorts = about 6 large ea.) to put the gold market into a whole new light.
Even half the stores in delivery mode should wake up the current players in charge.
We could even set MK and the USA faithful up for life. Oops, there might be a freudian slip in here somewhere.
What got me thinking was when my commodity broker mentioned on Friday that in 10 years at the business, he never delivered 1 contract of gold....YET
3 Things Last Week
-- Personal spending grew 1 percent in February, more than twice the rate of income. Savings is at a record low
-- Republicans joined Clinton in the fight to make stock options available to every employee.
-- Mr. Levitt (SEC) confirmed that there is great fear of margin rates and asset backed stock purchases but agreed with Greenspan
about not touching margin rates.
No one wants the bull market to slow and no one will do anything to control the speculation except install trading curbs, circuit
breakers and offer verbal warnings and written reports. As the bubble continues the main goal from the government is to encourage
investing in stocks from any source of capital. This main goal combined with the lack of dedicated action has all but guaranteed a
horrible end.
You don't try and stop the crash on the downside but on the upside.
Disscussion for Sir RossL on Msg 27930 to Sir Galearis
Your comment: "Most of the positions represented by the open interest on the COMEX will be closed out for cash settlement or rolled over to a later month."
True. Just as open interest in the COMEX June gold futures has recently climbed to 78,900 contracts, the position in the April futures was also quite large a few weeks ago in advance of it reaching delivery month. Positions were closed out by the thousands (with many players likely reestablishing their positions with June contracts) in advance of the arrival of first delivery day...5,463 contracts being settled (cash) one day prior to First Notification day, leaving just over 10,000 contracts in open interest. Clearly, as you say, the majority of April's past open interest was settled with cash.
Your comment: "Declaring intent for delivery on "first notice day" can for the most part be viewed as a bluff in a big poker game. What matters is how many and who holds the contracts open at the end of the trading month. For example, Monday I could go long for a 100 oz. contract and declare intent to take delivery. If I close out the position in a week, then my declared intent is meaningless."
This example of yours I don't quite understand. If you have an April long position, (let's say that you established many months ago at some given price (let's say $275)), your announcement of delivery intentions is effectively your exit from this position. You will therefore be paying COMEX the $275 multiplied by 100 ounces. Meanwhile, COMEX will contact the entity with the longest standing short postion to tell them they must yield up the gold that they theoretically sold when they took their short position many months ago at some contract price (let's say $273, for example). COMEX pays them $273 multiplied by 100 ounces, and expects them to make good on their word to deliver the gold "as promised" before the last business day of April.
To give more of the picture....I stated in TownCrier (03/31/00; 15:04:12MDT - Msg ID:27856): "Walking away with a substantial portion of this gold so far is Deutsche Bank (2,542 contracts) and Cargill (2,130 contracts)." What I omitted for sake of brevity was that The Bank of Nova Scotia found itself named on the delivery side for 5,567 contracts'-worth (over 17 tonnes) of this total gold in question for delivery. Another agent, Prudential, must deliver 1,716 contracts'-worth, but they were further to be found as an agent on the receiving side for 2,380 contracts.
As we've stated months in the past, if they don't have the gold on hand to deliver, they will either try to "pass the buck" by calling for delivery themselves on other long contracts that they may establish for that express purpose, or else they must turn to the physical spot market.
I have noticed many people over many months "lick their chops" in regard to the COMEX inventory and say "If only we all got together or had Bill Gates buy these contracts and take delivery, THEN we would see something!"
I would suggest to these same people that each time they would please REFRAIN from buying a long paper contract they are helping to destroy this bogus pricing system to the downside; and further, every time they buy a single ounce from their favorite gold dealer they are removing it from the available physical market which aggrevates supply tightness to bust the price discovery process wide open...to ultimately revalue gold to the upside.
((by the way, thank you, Sir Galearis, for picking this COMEX delivery item up again and generating additional discussion where my effort had failed to do so))
Sir HI-HAT asked about the original post, "If these delivery intentions are correct...These delivery intentions appear astounding. I have searched around various net venues and I can find no mention of this. How could this be so? Where is this delivery intention information available?"
I obtain these numbers through a financial news service to which Michael subscribes...and which requires an access code. Unfortunately, I know of no source of this data that is available free on the internet, so you are left in the position to either trust me on this, or else wait until the mainstream media chooses to give coverage effort to something that historically they have had no interest in whatsoever (other than for routine disparagement for the reasons that are commonly discussed at the forum).
Leigh (4/2/2000; 18:17:47MDT - Msg ID:27940)
Bill Murphy Attacked and Injured
==
The way that the Hobbits read the story is that someone "coldcocked" him as he was returning from a evening of relaxing and song at a nearby watering hole. Well, first, Mr. Murphy is a former pro football player (from an Ivy League College), an Offensive End, if I remember correctly. (and therefore not a small weak stature of a person) Who would think about taking on such a type person in a fisticuffs adventure ? Well it appears, -- "ONLY a Chicken by attacking from the dark!" EITHER Mr. Murphy needs a bodyguard (and a great number of Hurons are volunteering ) OR, we need to find out a number of additional informational items -- LIKE was he telling COWBOY jokes ? -- does he sing offkey ?
I know he can take a joke also, as he is a little bit Irish!
<;-)
If the story is true about Bill Murphy, I would like to offer my condolences.
It is the most base sort of coward who atacks from behind, and I'm sure there is a special place in Hell reserved for those who commit such shallow atrocities.
Bill, you are decent human being, and I wish you a speedy recovery.
The Bank of Japan has intervened in the Forex markets this morning following Friday's sag of the dollar to 102.03 yen in New York trade, its lowest level in almost three months.Japan's Finance Minister, Kiichi Miyazawa, said of Friday's rise in the yen's exchange rate versus the dollar, "The currency movement looked a bit too abrupt." [From another article at http://biz.yahoo.com/rf/000402/ds.html]
He made the remark after the authorities sold yen in the currency market and sent the dollar spiking up by two yen. He also told reporters that, "Volatility is troubling and we are responding firmly," however, the Bank of Japan's action today to sell yen to buy dollars sent the U.S. currency vaulting from the 102 level up well beyond 105 in current overseas action.So why is the Japanese government trying to override the market forces that are pushing for a stronger yen? Their response is that they feel that a weak yen is needed to bring about a recovery from Japan's worst economic downturn following the last world war.
National currencies will always be used to do it's issuer's bidding...to bring about one economic condition or another as deemed to be in the national "best interest". The best an individual citizen can hope for is the availability of an individual, independent monetary asset (such as gold) that is left immune from such chicanery. Then, he can thereby gain a degree of personal sovereignty as a "nation unto himself"...at least as far as his wealth is concerned.
Don't be shy about using these Japanese interventions which strengthen the dollar to your advantage. Redeem those temporarily(?) strong dollars for something of lasting value.
I just read my e-mail, and now I've heard it from Bill. Its a true story.
I kind of dont think its TPTB, because they have such sophisticated means of nutralizing opponents. I dont think they need to use street thug methods. (Arkansas)
If they wanted Bill out of the game, he would most assuredly be gone already, and without much ado.
On the flip side, its possible they (TPTB) would rather have an opponent simply withdraw from the fray of his own volition, rather than immortalizing and enshrining the leader of a cause by outright removal. That might serve to unify and propel a movement into front page status, which would end up having the reverse effect desired.
Sir TC- Very good point on long paper feeding the shorts; a converse of short covering feeding a rally (?)
I believe Sir Farfel has addressed this before with the summation that if the long paper would disappear, the shorts would have no body to leech off of.
Anyways, I was just dreaming of a USA forum hostile takeover of the Comex commissary, ala George A. Custer and the buffalo. Hmmm.... With that thought in mind, and his getting more than he bargained for, perhaps I'll just call you nice folks this week and "GET PHYSICAL".
I received the following disturbing news a little while
ago from GATA Chairman Bill Murphy. Maybe it means nothing. But if this stuff keeps happening, it surely WILL mean something.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
By Bill Murphy, Chairman
Gold Anti-Trust Action Committee Inc.
Sunday, April 2, 2000
Last night was a bummer. After working all day, I
walked over to the local hot spot restaurant to have
a good meal and blow off some steam. As my car
was stolen a month ago and has not been replaced
yet, I had to walk. About 1 a.m. I left the restaurant
after listening to some great tunes and headed for
home on foot.
About 20 yards outside away from the restaurant,
somebody out of nowhere socked me in the left
cheek. Down I went. All I remember is being
picked up by people. I don't think my jaw is broken,
but I can hardly talk and my right cheek (which I fell
on) is a mess.
I have lunch tomorrow with a money manager who flew
in to Dallas from London to meet clients. He won't forget
my appearance, as I look like I went a round with Mike
Tyson.
Today I was taken by friends to the passport photo
place to have a permanent record made of the one-punch
knockout.
First,my car is stolen and yet money is left in the stolen
car when it is recovered. Now this haymaker on my way
home. Were these two random events occurring a month
apart from each other, or are there more sinister forces at
work? Is GATA getting to close to the flame?
I don't know the answers, but it is all a bit unnerving.
Sir IronHead, "...perhaps I'll just call you nice folks this week..."
http://www.usagold.com/ProductsPage.htmlWith Japan currently helping out the purchasing power of the dollar, and with analysts calling for Microsoft to trade down 10% on Monday due to the breakdown in settlement talks (possibly leading to weakness in stocks (or maybe even a blow-off top in techs based on the big competition being cut down at the knees(??))) this looks to be one of those turning points, and therefore a wise time to take action. I have every confidence that Michael will treat you right should you decide to call.
HEADLINE: Microsoft stock seen sliding about 10 pct on Monday
http://biz.yahoo.com/rf/000402/dw.htmlWould Microsoft owners be as riled over a $10 fall in share price from $100 to $90 as gold-sector investors seem to get about a $3 fall in the price of gold? Lor' ha' mercy if they do.
By most accounts, however, those with an eye toward acquisition of the yellow metal (instead of a paper derivative of the metal) continue to welcome these buying opportunities at better prices than the time before. Rather like fate smiling on their situation to be in a position to buy again...
Keep Up the Attack, Don't Let the Bastards Get You Down!
With poor Bill Murphy recovering from his recent attack, then other goldbugs must step in and fill the vacuum.
Do NOT be intimidated, I know I am not.
I send my best wishes to Bill, who I recently met at the CMRE dinner in New York. What a fine gentleman!
Anyway, here is my latest little contribution to "the cause:"
For those who are interested, one of the former senior partners of Goldman Sachs, Jon Corzine, is running for the Senate in New Jersey.
His ads proclaim that he is a sensitive man who is looking out for the best interests of the American worker. Furthermore, his ads state that via his senior role at Goldman Sachs, he was a key figure in facilitating today's prosperity in America.
UNLESS, of course, you are a gold miner, whose employer went bankrupt and tossed you out on the street.
UNLESS, of course, you are a gold investor, who has lost tons of money playing in a rigged market, manipulated by leading members of the gold carry trade (such as Goldman Sachs).
If you think Mr. Corzine should be reminded about his major, nefarious role in the decimation of the gold industry and the decimation of your bank account, then you can contact him via his campaign manager, Mr. Steve Goldstein, at the following E-MAIL address:
SGoldstein@votecorzine.org
I say, "FLOOD MR. CORZINE'S MAILBOX AND GIVE HIM A PIECE OF YOUR MIND!"
Remember, gold is a political metal, and until the politicians and their investment house bosses stop crapping on it, then it will never go anywhere.
You may have noticed that the securities brokers are increasing margin requirements on their own. Particularly for the smaller investors.
Tiger's Robertson is still sticking to his tech wreck story (with which I agree wholeheartedly). The tightening action by some brokers on margin requirements was the reason for the Jan and April 99 declines in internet stocks. The smaller names had never recovered from the hit. The tightening had the effect of forced sales on the stocks.
Perversely, some of the stocks that weakened as a result of the tightening were internet brokerages.
The months following the margin tightening saw a rise in margin debt, which took off again in Oct 99-Jan 00.
In effect, market participants (brokers) were taking appropriate action to reduce margin on high volatility stocks without Fed dictation of margin policy. Very good.
What the Fed should have done was to start raising rates earlier than it did and try to pressure the Klyntonites to reduce importation - or, better yet, keep rates low and get the dollar to decline before further imports raise the US debt position to more impossible levels. The decision to raise rates whenever the dollar weakened was well beyond foolish economically, the only reason to do it was to allow further US absorption of mega-quantities of imports so that people feel better during the election year.
The price inflation is going to happen whatever the Fed does, the only questions are how high it would go and when would it start. The Fed actions delay the start but increase the depths to which the dollar would eventually fall and the rate at which it would reach that point. Perhaps there is something, an arrangement, that could be negotiated for the slow unwinding of the US debt position, for which buying more time is a positive. However, no such solution seems forthcoming, and to be frank, there is no possibility for a solution that does not involve a colossal American default - either debt is not repaid, or it is inflated away. A long term "go slow" solution would still require a 70% drop in the dollar just to get the debt repayment started. That kind of drop in the dollar would force prices within the US to quadruple and would be a default of 70% on the nearly $9 trillion dollar American debt held in foreign hands.
The first notice day explanation in Msg ID:27930 is how it was explained to me by a commodities broker in 1993. I haven't played any gambling games on the COMEX since then, so I don't know if it's changed. However, I did once declare intent to receive delivery on a 100 oz. contract and then later close it out. That was on the advice of my broker at the time.
Thanks for calling this to our attention. I sent an e-mail as suggested by you. I sincerely hope many others will follow.
Incidentally, I read that the new "gold" dollar coin tarnishes very quickly.
FOA's post the other night, in which he mentioned about investors who are given paper and told, "This is the gold portion of your portfolio," got me thinking. Why not have the WGC, GATA, or some other group EDUCATE these innocent investors that they are in danger of being fleeced? What about a "PAPER GOLD ISN'T GOLD" campaign. Since the WGC is fond of dressing up their actors in character costumes (remember the Spanish explorers last year?), how about King Solomon being told by a sleazy-looking courtier, "This, O King, is the gold portion of your portfolio." King Solomon would roar back, "Gold? That's paper! THIS (indicating his shining palace) is gold!" Or have a woman with children fleeing from a war scene. She tries to bribe the guard with paper gold. The guard looks disdainfully at her and says, "Ma'm, I know real gold when I see it." The woman wails, "But my investment counselor told me this was the gold portion of my portfolio!" Or perhaps an ad in investment magazines like Forbes, Barron's, etc. could give details about the gold carry trade and why paper gold is a dangerous investment. Just a thought.
MSFT target is $60
by: keiserisbrama (34/M/cactusjack, AZ)
4/3/00 10:36 am
Msg: 171844 of 171861
Based on violation of Anti Trust law ...judge will layeth the smack downeth on Uncle BILL
Today's Report: Gold Down on Japanese Move Against Yen
http://www.usagold.com/Order_Form.html4/3/00 Indications
�Current
�Change
Gold June Comex
279.70
-1.70
Silver May Comex
5.04
nc
30 Yr TBond June CBOT
97~15
-0~06
Dollar Index June NYBOT
105.42
+0.26
Market Report (4/3/00): Gold was down in the early going on reports that
the Bank of Japan had intervened in currency markets to bolster the dollar
against the yen. The yen is plummeting as this is written underscoring a
nearly one decade old policy on the part of Japan to beggar their
trans-Pacific American neighbor with an artificially low currency -- a policy
designed to boost exports. Simultaneously, the Clinton administration did a
considerable amount of grumbling over the weekend about its trading partners
import policies that keep American goods out of those markets. We've
witnessed this bureaucratic version of hair-pulling, wailing and gnashing of
teeth before -- it is all a sound and fury signifying nothing.
As for gold, there was nothing particularly striking in the news that would
justify the nearly $2 drop. The yellow metal was firm but range bound in both
Asia and Europe overnight. The downside came in as the New York market
opened. Austria announced its selling program which falls in line with what's
been granted them under the Washington accord. Austrian central bank
director, Peter Zoellner told Reuters that the bank had sold between 30 and
50 tons last year. "There has been no change in our policy on gold sales," he
said. "All this means is that our sales are now taking place in accordance
with the Washington agreement and are fully transparent, which was what the
market wants." Standard Bank reports gold well supported with good physical
demand at the $275 level. It briefly got to $280 during the London session
but ran out of steam.
That's 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.
It doesn't get much clearer than this...check this out
http://biz.yahoo.com/rf/000403/os.htmlIn several months throughout 1999 prior to the Washington Agreement there were occasions when the gold reserves of the Euro system of central banks declined by small amounts that were never explained by the ECB other than a vague statement about a nation honoring prior commitments. At the time, we speculated that these small reductions in gold were likely by the hands of the renowned Austrian Mint. Today's news helps to cast better light on that speculation with the statement that some of these current Austrian sales are indeed destined for the Austrian Mint for coin production. Bank Director Peter Zoellner said the announcement was within accordance with Washington Agreement, and was to provide full transparency for the gold market. Based on Austrian bank sales since 1993, this announcement reveals that their program of overall sales would actually be slowing.
Now here's the really juicy news in mainstream media black and white. Reuters reports "The Austrian bank said it was selling the gold under a system operated by the Bank for International Settlements."
TownCrier's bottom line: Somebody please tell the LBMA that there is a new kid in town...
http://biz.yahoo.com/rf/000403/rh.htmlEconomic growth is accelerating to an expected 3.2 percent for 2000 while price inflation is projected to be 1.7 percent. The International Monetary Fund said Euroland growth would best be facilitated through monetary policies that ensured price stability and fiscal policies among nations that encouraged public saving.
A cautionary note for those invested in the U.S.: according to Reuters, the IMF also said that "the downside risks for the euro economic area were mainly subject to uncertainties surrounding the timing and intensity of a downturn in the United States." It would seem that candid entities see the U.S. downturn as inevitable.
HEADLINE: IMF says euro very undervalued, prospects solid
http://biz.yahoo.com/rf/000403/tx.htmlIMF European Department Deputy Director Jacques Artus said "From a medium-term standpoint we would view the euro needing to appreciate, vis a vis the U.S. dollar, by 30 percent or more."
He further said, "In the past 20 or 30 years (European) central banks have been acting to reduce inflation. They have spent the past 20 or 30 years trying to squeeze inflation out of the system. This to a large extent has been done. The task today is not to squeeze inflation out of the system, the task is to avoid it coming back."
Fed provides rather "largish" overnight add in light of recent long term RPs and coupon passes
With two 28-day term repurchase agreements on the books, and in the wake of two recent permanent additions to banking system reserves via coupon passes, the Federal Reserve provided yet another $3.5 billion in overnight funds with half a week left remaining in the current reserve maintenance period.
Fed funds this morning were trading 1/4 percent higher than the Fed's target rate of 6 percent.
Planned Expansion of the NEW WORLD ORDER Banking Facilities!
http://biz.yahoo.com/rf/000403/s9.htmlExcerpt:
HSBC(Hong Kong Shanghi Banking Co.){{Former Central Bank of Hong Kong with headquarters in London England}} has bid for all the shares of CCF(Credit Commercial de France) for a total consideration of 11 Billion EURO's.(Click above URL for full story)
beesting comment:
Once this take over is completed part of Great Britian's banking system(in France) will be using EURO's...FWIW!
Lady Leigh, why don't you e-mail your suggestion to the World Gold Council....Who knows, they may use it!!!
>Clint H (04/02/00; 00:26:32MDT - Msg ID:27924)
>Hipplebeck Msg ID:27327
>Hipplebeck, in your post Msg ID:27327 you stated that
>very, very few people have ever handled a real gold coin.
>A statistic used in the retail coin selling industry is
>that 97% of the American people have never held a gold
>coin in their hand in their life. I think that is close to true.
Greetings, all. Been reading for a few weeks and thought I'd add an observation on this point. Inspired by a discussion on another message board (of a different topic entirely) about two months ago I started carrying around a $5 Gold Eagle (1/10 oz) in my pocket with my change. I show it to people from time to time.
I work in an industrial design firm and many of our employees make substantial amounts of money and are more or less active in the investment world. (Not me, darn it... squirrelling it away when I can.) Without exception, when I've showed them the coin, not only is it the first time they've handled a gold coin, it's the first time they've ever *seen* one up close. The really ironic part is that they're never very impressed by it (it is kinda small... donations of larger coins gladly accepted for educational purposes) but they all go mad for those Golden Dollars (aka Brass Bucks.) One or two of them have bought gold coins from me, more for the novelty than anything else, I think. (I'm not a "dealer"... I just have a few, and when people I know say, "I'd like one of those," I offer to sell them one.) But I can't for the life of me get even one of them to plunk a few dollars into gold or silver as insurance for when the bough breaks.
I'm going to keep trying, because rich friends are good to have. *smile* I have also started carrying a Silver Eagle around. They're much more impressive, size and heftwise, and they have a very nice ring when you flip them. A few people have seen this already and have bought a few just because they're so pretty.
It also makes an interesting visual prop in discussions about finance. When they ask me why I carry gold and silver, I say, "Because I like to have *real money* in my pocket." To the blank look this usually gets I take out a quarter or something, or a FRN, and say, "This is currency." Then my Eagles and say, "This is *money.*" Then I give them the sixty-second explanation of the distinction. Everyone knows the old saw about remembering what you see versus what you hear, and this is no different. It shouldn't make any difference, but people seem to have an easier time grasping the concept of fiat currency versus money-as-stored-value when they're looking at examples of each.
Plus it makes you feel rich to walk around with a silver eagle in your pocket, bulky as they are. *smile* So I recommend giving it a try. I'd love to report on how it makes one feel to walk around with a gold Eagle (a big one) in one's pocket, but that will have to wait until I can afford some for my stash.
Delivery notices for April have increased to 8,862 contracts...27.6 tonnes
Delivery intentions posted this morning increased the total on COMEX April gold futures by 1,119 contracts. Once again, Duetsche Bank was the largest net recipient, on the heavy side of 200 additional contracts.
For those who did not read my earlier post today, let me note that Mr.Jon Corzine was a senior partner in Goldman Sachs this past decade and as such, one can only assume he helped orchestrate the nefarious gold carry trade that has decimated the gold industry and destroyed the fortunes of many gold investors, myself included. All evidence points to Goldman Sachs (utilizing subsidiary J.Aron) as a key player in the gold carry trade.
So when Mr. Corzine tells the world that he has been a key participant in bringing prosperity to America, we all know that so-called prosperity is limited primarily to Wall Street investment houses and the high tech sector while certainly excluding the vital commodity producers of the nation.
When Mr. Corzine speaks of his sensitivity for the American worker, he obviously does not include the thousands of unemployed gold miners or bankrupted farmers in that category.
When Mr. Corzine announces his intentions to represent American interests on the international front, then one must ask how other nations feel toward such a man who played a leading role within the investment houses and hedge funds that raided various foreign currencies or destroyed the value of various developing nations' key commodities, such as gold and silver.
As reported by the New York Times, Mr. Corzine is already in hot water for various anti-Italian comments he has made during the campaign, for example, when meeting a New Jersey Italian-American for the first time and discovering the man worked in the cement business, Mr. Corzine is said to have responded, "Oh, so you make cement shoes?" You can well imagine the Italian-American reaction to that little comment.
Well, I say the man needs more hot water thrown his way. A lot more!
So, pursuant to my earlier post today, I have yet another E-MAIL address for Mr. Corzine's other campaign manager, a Ms. Christy Davis.
CDavis@votecorzine.org
I urge gold investors blast these people with a barrage of E-MAILS and let them know what you think about Mr. Corzine's bid for a Senate seat.
Source: Bridge newsAsia Precious Metals Review: Gold moves in $278.50-279.50 range
Hong Kong--Apr 3--Gold firmed in Asian trade Monday, moving in a US 278.50-$279.50 range most of the day, dealers said. Spot gold is expected to be rangebound over the near term, with support seen at $276 and resistance at $281, they said. Silver and platinum traded near Friday's late US levels in thin trading. (Story .2200)
Black Blade: At least there is a little time left to accumulate some PMs according to these guys. Techs are under sever pressure today. The masses may just decide to take some profits off the table. Maybe some of those $ will migtrate toward the metals ;-)
Also, Japanese PM is in coma after suffering stroke. The Japanese government had delayed the announcement for several hours. Still, Au didn't budge.
"...I did once declare intent to receive delivery on a 100 oz. contract and then later close it out. That was on the advice of my broker at the time."
If your broker in fact passed along your intent for delivery to the Commodities Exchange, then depending on the timing of the subsequent events on the advice and action of your broker, you may have had brief ownership of 100 ounces registered to you in the COMEX warehouses. And if so, then as you say, prior to you getting the notion of having them ship you the gold for your personal safekeeping, your broker may have sold a gold contract on your behalf, and used your registered stock to settle the position, removing your name from the title.
Par for the course on the COMEX gold market is that no metal changes hands or title. The players simply make cash wagers on the future price movement. Then, when they bow out of their contract positions as winners or losers, they settle the score with cash.
I looked around over at www.nymex.com for a clarification of the rules. I couldn't find any solid statement, it appears that the rules change for different commodities.
This highlights one of the reasons I stopped playing the futures gambling games. The commisions were high and the fills were always $10 or $20 worse than the bid or ask. At the time I didn't have the internet for information, and all small players have a great disadvantage. Somehow I made a profit in the bull run of '93 using the WSJ and CNBC as sources of information.
That was enough to fuse the gold bug into the marrow of my bones! I decided to remove my funds from the grips of those vultures and invest in numismatic objects of great art and beauty. Real money. Timeless treasures.
From information presented in two reports "Asset Prices and Banking Stability" and "EU Banks' Income Structure" Bloomberg begins their article "Commercial banks in the European Union would probably be able to weather stock market declines if they occurred." The European Central Bank said of the findings of its Banking Supervision Committee, "If stock prices were generally to fall in isolation, major difficulties would not be expected for EU banks." Sharp declines were said to pose some risks, and exposure to real estate would be the "most prominent source of concern for banking stability, should a major decline in asset prices occur" according to an ECB board menber.
This should serve as a wake-up call to everyone who casually assumes that banks, including U.S. banks, would natually survive a market slide. If there was absolutely no cause for concern, studies such as this would not be conducted. Now ask yourself, to what extent are U.S. financial institutions overexposed to market mania? Please recall, the Fed deliberately chose to leave its expanded "Y2K list" of acceptable collateral in effect for banks to borrow against as needed. Cause to share a realistic concern?
Fellow, Goldmeisters, take heart and know that Uncle Sam is not only manipulating the gold market and rigging the PPI and CPI numbers. Misery loves company and you now have another group of folks who are the latest victims of government legerdemain. The news released on Friday that the USDA somehow "lost" 30 million bushels of soybeans is a testimony to this type of manipulation. Now 30 million bushels is no small number. What happened is the USDA "overestimated" (lied) about the harvest figures last November to the benefit of unknown parties. (Gee, I wonder who would benefit from such chicanery.) Prices for soybeans were forced down to unheard of levels while China and others bought at extremely favorable prices. Sound familiar?? Was this a Clinton administration payback for all of that Chinese money that financed his 1996 campaign? Then when it is time to let the market run, these very firms are long options and futures and are making a killing. In the meanwhile, the poor farmers got taken to the cleaners because they could not hold onto their beans any longer. Anyway, the whole thing stinks
Vengold Aka Itemus: Collapsing, Collapsing. Now at $1.75
Down almost 50% from just several weeks ago.
Hopefully, people listened when I warned them about this former gold company a few months ago. It is falling in price and my target price projection is somewhere around 15 cents when the dust settles.
The major reason why Itemus is failing to climb (aside from the current massacre in the NASDAQ) is that it violates the central rule of any soaring internet stock: plain and simple, vengf has way, way, way too much float, almost 200 million shares, whereas most successful internet stocks have average float in the area of 4 to 8 million shares only, at least when they first IPO. No doubt many long suffering gold investors have been dumping their millions and millions of vengf shares now that they have this window of opportunity to get out.
Moreover, the company is a weird one. When the company originally converted to an internet incubator, nobody seemed to know who was in charge.
In conclusion, I've said this before and I'll say it again: when gold companies and gaming companies etc. are converting to internet companies, that has got to be a very loud bell signalling a market top, if ever there was one.
After all, if taken to the logical extreme, soon ALL American companies would be inspired to become internet companies. Then who would be left to provide the essential, life-preserving goods in the country?
http://biz.yahoo.com/rf/000403/tp.htmlFor the same basic reasons that lead to bank runs in the late 1920's - early 1930's, seeking security against the overextended paper positions of the financial institutions, the situation is certainly ripe for a reply.
Reuters says "Traders agreed the [Austrian] sale would have little impact on liquidity in the 900-tonne-a-day bullion market." It stands to reason that "The Austrian selling is not going to affect the market liquidity in an unexpected way," [--Frederic Panizzutti, vice-president strategy and research at MKS Finance in Geneva] not only because of the pre-announced Washington Agreement, but because this is just a token quatity of real substance in a vast paper-representative market. At 900 tonnes traded each day, you can see how the entire 5-year allocation of 2,000 tonnes under the Washington Agreement could be snapped up in three days if the market moved to put real metal behind their paper veils.
Keep in mind our earlier report revealing that Austria would be using the gold operation system offered by the BIS. It would seem that the LBMA's (paper-based) system is being openly and officially forsaken. As a sovereign individual, you owe it to yourself to conduct your personal affairs accordingly. There is no single bureaucrat in Washington looking out for your best financial interests...nor should you expect there to be one, nor would you want one. Ultimately it comes down to each person having responsibility to maneuver for their best personal interests. Keep in mind that thanks to the market mania, gold is off the radar screen at this time for millions of Western investors. Use these opportunities to your advantage when you know the score and others do not.
The Nasdaq Composit Index performance is like watching a train wreck...
...horrible in its destruction, yet I cannot look away.
The Nasdaq is currently down beyond 300 points (nearly 7% on the day), while the Dow Industrials are the beneficiary...up more than 2%. Surreal.
You see, many mutual funds are compelled by their charter to keep a certain percentage of their funds in stocks. They simply can not flee to the sidelines or jump ship, but instead must run from one side of the listing ship to the other, back and forth, bailing water but sinking nonetheless in the end.
While Wall Street Propaganda Machine rolls on in the "Quest To Get Rich In America". The truth is that with the steady sinking A/D line, wild....wild...volatility, margin calls, there is some real CARNAGE going on out there.
Thanks for the honor roll (or should it be the dishonor roll) of grain merchants who would be the beneficiaries of this government manipulation. I knew that Cargill was one of them but had forgotten about Archer Daniels Midland and Continental. In fact, this whole episode reminds me of a book on this subject. I can't remember the exact title but I believe it was called "Merchants of Grain." Can you verify this and let me know?
Correcting a typo...."reply" should be "replay" in a recent post
"For the same basic reasons that lead to bank runs in the late 1920's - early 1930's, seeking security against the overextended paper positions of the financial institutions, the situation is certainly ripe for a REPLAY."
No stress when you are confident in your convictions and find yourself well ahead of the masses. It's good to breathe the fresh air in front of the herd...
Another one for the record books - - - it's good for you!
- NASDAQ closes down 350.01 points and 7.6%, it's largest point loss ever and the 5th largest percent drop in history. Microsoft loses $79 billion in market capitalization, an unprecedented loss in Wall Street history. Client: "Why are these stocks going down?" Broker: "I don't know. I don't know why they went up!" -CNBC, 00/04/03, 4:01:36 PM EST
"'This is good for the market, good for the economy, this is what Alan Greenspan wants.' are the comments I've been hearing from the brokers here." -Bob Pisani, CNBC from the floor of the New York Stock Exchange, 00/04/03, 4:08:23 PM EST
Thank you friend TC, to bring the CNBC exuberance of still another CB selling off their non performng assets! I've started a response hours ago - got interrupted by local political reasons - as I am the proponent for an international golf club - on the sideways (My beloved old lady and I are getting on) and, as the kids are gone we find ourselves in a way too big, (300y's, not too old -since all refurbished mansion house, quintruplex to give you an idea), surrounded by another 45 acres - 20 k's West of Vienna.
As you've skipped the first paragraph - pls also skip mainstream media about OeNB(Austrian Nat.Bank) gold sales. I've tried to contact the Bof Au president, Dr. Klaus Liebscher today, an old former banker friend to discuss this - as I've feared black-or other mail (re: recent reparations to forced labor in the 3rd Reich) - it just seems to be the usual media hype. - Or Wall Street and G-span are getting desperate - to save the (Hi- Sir F* - feel with you!) - $!
BTW - another hot 60 tons will, or may be sold after 2004 - same, insane media hype- till sorry CB2
I vaguely remember a book by that title, so can't help there. I do however think that as in gold and silver manipulation, the commodities market is rigged across the whole spectrum. It's a big boys game in cahoots with the Federal overseers to make sure there is no inflation on this end to hurt dollar, etc.. Keep masses in the cheap Bread. The forcing down of Mining and Agricultural products below parity while financing expansion with DEBT, is the true bedrock reason for the upcoming conflaguration. As for Farmers , they care not a wit, since decision has been made to liquidate them and go the Big Corporate Farm route. I think they are doing everything they can to get the gold mining properties too, after they destroy them.
"I've tried to contact the Bof Au president, Dr. Klaus Liebscher today, an old former banker friend to discuss this"
Of the elements of this eventual discussion thay you might be at liberty to pass along, you'll have to let us know what interesting things are on his mind these days.
Took a quick poll of those few of us currently milling about here in The Castle and found that we are all in favor of a relocation to 20 k's West of Vienna to help fill up that house...
Transferring Money from a Super Bubble to a Mere Bubble
The funniest aspect of today's stock markets performance is the CNBC spin suggesting that the NASDAQ had become irrational and now money is moving into a rational market, the DOW.
The DOW? Rational? What an absurd joke! You have companies trading today for valuations that are in many cases 100% higher (or more) than any real book value....that in many cases trade at much higher prices than a mere two or three years ago, yet with current revenues and profits no higher today than several years back.
What lunacy to suggest the DOW stocks are rationally valued?
By the measure-stick of a maniac maybe.
It is an interesting exercise in manipulative market deceit: boost a market like the NASDAQ to obscenely absurd levels, then pray that the already obscenely valued DOW will appear reasonably valued in comparison. Thereafter, Americans will regard the DOW as reasonably valued. Of course, the entire strategy depends on the collective amnesia of the American investor (already proven to exist), the collective stupidity of the American investor (already proven to exist), and an interventionist governmental body to rig the entire thing (it's a Clinton government, enough said).
At least today's action proved that the markets are at a point where funds inflows are insufficient to maintain price verticality in both markets, instead funds must be transferred back and forth between the two competing markets, in a kind of game which goes like this:
Today you get to ride the pony, I don't
Tomorrow I get to ride the pony, you don't
As I wrote in my Fifth Horseman thesis on this forum, the ultimate downfall of the markets will probably result from the current heated competition between New Economy vs. Old Economy funds. These funds, once cohesive in a "one for all, all for one" index strategy, are now already undermining each other's efforts and sales spin as they desperately compete for a dwindling supply of funds inflows.
Soon, we will see the same thing occur with the bullion banks as cohesion is certain to end there too. Then each bullion bank will run for the lifeboats (physical purchases of gold) in order to ensure survival, even at the expense of their gold carry trade partners in crime. The one left holding the necessary physical gold to cover gold shorts will have a de facto monopolistic hold on the entire investment bank sector, and can swoop in and pick up the remains of the devastated investment bank sector for pennies on the dollar.
My bet: it will be Goldman Sachs, with a little help from Rubin and Summers, leaving JP Morgan, Deutsche, Chase, etc. to eat sh*t in bankruptcy court.
TC - Wellcome - pls fill my house with gold (-f-*) bugs anytime!
... and be sure I'll keep you posted on any response from K.L. - as I've had hell to pay for my "real money" stance- gold- because of it. ... And there'll be hell to pay, I'd hoped for others- in explaining the timing of this (golden) non event! - I'm F*arfeling mad!
F* - forgive me for mishandling your F*-Handle - though a certain Insane Ron on Collective Nonesense Broadcast Co. - felt obliged to announce another CB gold sale as future "history" of reality ... as in today's mkt's: old eco stocks gaining 300 pts., or 2,7% vs new eco tanking 350 pts. or 7,4% - only Qu. for PPT - MSFT - spring - or (melt-) board ... (BTW-Qu stands for question(-able) and not for quarterlies).
Cheers- and I'll stick around for updates!CB2
I Think I'll Keep on Doing my Investing With Michael
NYSE Announces Disciplinary Actions Against Six
Member Firms and 13 Individuals
NEW YORK, March 31 - The New York Stock Exchange has taken disciplinary actions
against six member firms and 13 individuals for violations of NYSE rules and federal
securities laws. The cases, prosecuted by the NYSE division of enforcement, may be subject
to review by the Securities and Exchange Commission and, thereafter, by federal courts.
In addition, the NYSE modified the summary suspensions of John R. D'Alessio and
D'Alessio Securities, Inc. The related decisions concerning that matter are summarized at
the end of this news release.
Six Member Firms Disciplined for Violating NYSE and/or SEC Rules and
Regulations
Charles Schwab & Co., Inc. Disciplined for Supervisory, Books and Records
and Reporting Violations
Charles Schwab & Co., Inc. of San Francisco, Calif., a member firm, consented
without admitting or denying guilt to findings of supervisory, books and records and
reporting violations.
� An NYSE hearing panel found that, in August 1995, Schwab initiated a program called
"new accounts by phone" to open certain new retail accounts by telephone prior to the
receipt of signed, original customer account documents. The program was in operation from
August 1995-January 1998 but, for much of its existence, it lacked proper controls, which
resulted in accounts being opened without timely supervisory approval or receipt of
customer account documents, including customer options and margin agreements and
documents relating to IRA accounts. From at least October 1996, at any given time, the
firm did not know the number of registered representatives using the program nor did it
know how many accounts were opened under the program.
� The panel found that, during the relevant period, the firm failed to establish adequate
procedures to supervise the opening of and trading in these new accounts; permitted
registered representatives to override certain trading restrictions on customer accounts
without supervisory approval -- restrictions that had been imposed by the firm on the
accounts because of missing documentation; and failed to conduct reasonable follow-up on
supervisory deficiencies regarding the new accounts by phone program.
� The panel also found that the firm routinely entered inaccurate information into its internal
computer system indicating receipt of new customer account documentation when such
documents had not yet been received for new accounts by phone, and failed to maintain
required new account documentation concerning numerous new customer accounts.
� In addition, the hearing panel found that, during January 1996-June 1997, approximately
192 sales practice-related customer complaints were improperly coded by the firm as
"operational" in nature.
The NYSE imposed a penalty of a censure and $250,000 fine. Charles Schwab consented to
the penalty.
Credit Lyonnais Securities (USA) Inc. Disciplined for Financial, Operational, Books
and Records and Supervisory Deficiencies
Credit Lyonnais Securities (USA) Inc. of New York City, a member firm, consented
without admitting or denying guilt to findings of financial, operational, books and records
and supervisory deficiencies.
� An NYSE hearing panel found that, during approximately June 1994-March 1997, the
firm: failed to keep current and preserve certain records relating to assets and liabilities,
securities borrowed and loaned, securities fails, securities differences and records reflecting
securities positions and locations; filed inaccurate FOCUS reports (for the period
January-December 1996); failed to properly compute its net capital; did not reconcile
securities and money balances and promptly resolve differences; did not clearly identify, as
suspense accounts, accounts used as such; did not assign qualified employees responsibility
for each general ledger account, did not provide monthly supervisory review of each account
and did not maintain a written record of the names of the employees assigned primary and
supervisory responsibility for the accounts; and failed to keep current and updated
registration information on file with the Exchange concerning changes of employment by
registered personnel and failed to properly register with the Exchange certain officers,
directors and approved persons.
� The panel also found that the firm failed to reasonably supervise or control certain of its
business activities by failing to: provide supervisory controls at the operational level; assign
responsibility for control; and identify lines of authority.
The NYSE imposed a penalty of a censure, $225,000 fine and an undertaking that the firm
retain an independent consultant to prepare a report on the firm's systems and procedures in
the foregoing areas and submit to the Exchange a copy of the report, together with a written
representation that all actions or changes referred to in the report have been completely
implemented. Credit Lyonnais consented to the penalty.
Raymond, James & Associates, Inc. Disciplined for Supervisory, Operational, Books
and Records and Reporting Violations
Raymond, James & Associates, Inc. of St. Petersburg, Fla., a member firm, consented
without admitting or denying guilt to findings of supervisory, operational, books and
records and reporting violations.
� An NYSE hearing panel found that, for various periods prior and subsequent to a 1995
examination of the firm by the Exchange, the firm, among other things: failed to reasonably
supervise one of its New York divisions that was involved in money management and
brokerage activity; failed to obtain proper registration for certain supervisory personnel;
violated securities rules and regulations concerning records of orders, including allocations
of block orders and complete order ticket information; failed to ensure appropriate
supervisory approval of account designation changes; and failed to timely report to the
Exchange certain sales practice complaints.
The NYSE imposed a penalty of a censure and $165,000 fine. Raymond James consented to
the penalty.
Oscar Gruss & Son Incorporated Disciplined for Supervisory, Operational, Books and
Records and Sales Practice Violations
Oscar Gruss & Son Incorporated of New York City, a member firm, consented without
admitting or denying guilt to findings of supervisory, operational, books and records and
sales practice violations.
� An NYSE hearing panel found that, during 1994-1997, the firm (despite its knowledge of
the procedural deficiencies set forth in the decision) failed to supervise certain accounts
maintained at the firm, referred to as "flip" accounts, and the trading therein, as well as the
order desk clerks handling these accounts, by: failing to prevent non-registered order desk
clerks from accepting orders from public customers, from time-stamping blank order tickets
while not in possession of any order and from accepting third-party orders without written
discretionary authorization; failing to transmit discretionary orders for execution; and by
failing to prevent public customers from entering orders directly with floor brokers. The
panel found that, as a result, the firm lost control over the entry, transmission and execution
of certain orders for such accounts to the flip account owners and floor brokers.
� The hearing panel found that the firm also failed to make and preserve records relating to
the receipt and execution of all customer orders and failed to exercise appropriate due
diligence with respect to certain accounts.
The NYSE imposed a penalty of a censure, $100,000 fine and an order to comply with an
undertaking: to retain an independent consultant to perform a review and prepare a report
concerning the firm's systems, policy and procedures in the above areas and to implement
the report recommendations or an acceptable alternative thereto; that, for a period of three
years, the firm's chief compliance officer will conduct a compliance examination in these
areas; and to refrain for three years from carrying and/or effecting trades for any flip account.
Oscar Gruss consented to the penalty.
Moors & Cabot, Inc. Disciplined for Using Independent Contractors Improperly and
for
Books and Records, Reporting and Supervisory Deficiencies
Moors & Cabot, Inc. of Boston, Mass., a member firm, consented without admitting or
denying guilt to findings relating to its use of independent contractors, and for books and
records, reporting and supervisory deficiencies.
� Among other things, an NYSE hearing panel found that, during 1997-1998, the firm
permitted certain individuals who were independent contractors (65 of the firm's 130
registered representatives) to perform the duties customarily performed by registered
representatives, but failed to file related required documentation with the Exchange; and,
during 1997-1999, permitted 13 of the independent contractors to perform duties
customarily performed by direct supervisors of registered representatives
� The panel also found that, during 1998-1999, the firm failed to maintain certain books and
records in that, on several occasions: the firm failed to prepare formal net capital
computations, failed to maintain current documentation concerning the firm's inter-company
account with an affiliate company and failed to promptly report to the Exchange that an
employee had engaged in misconduct related to his floor broker activities on the Exchange
trading floor.
� The hearing panel also found that, during the relevant period, the firm failed to maintain
appropriate procedures for supervision and control of its business activities, including a
separate system of follow-up and review, to detect and prevent the foregoing violations. The
panel found that from 1994-1999, the firm failed to reasonably supervise and control the
activities of a floor broker employed by the firm and failed to reasonably investigate the
nature and extent of the broker's misconduct after receiving notice of it.
The NYSE imposed a penalty of a censure, $60,000 fine and a requirement to comply with
an undertaking to retain an outside consultant to complete a review and prepare a report of
the procedures and systems of follow-up and review adopted by the firm to prevent
recurrence of the foregoing violations. Moors & Cabot consented to the penalty.
Equitrade Partners, LLC Disciplined for Failing to Conduct In-Person Meetings with
Listed Companies and Related Supervisory Deficiencies
Equitrade Partners, LLC of New York City, a former member firm which conducted a
specialist business, consented without admitting or denying guilt to findings that it failed
to conduct in-person meetings with listed companies and related supervisory deficiencies.
� An NYSE hearing panel found that, during 1998, the firm failed to conduct an in-person
meeting between representatives of the specialist unit and senior officials of 35 listed
companies in whose stocks specialists associated with the specialist unit were registered.
� The panel also found that, among other things, the firm failed to ensure that companies, in
whose stock the firm was the registered specialist, were contacted as required and failed to
have any written procedures in place to ensure compliance with the above requirement.
The NYSE imposed a penalty of a censure and $30,000 fine. Equitrade Partners consented
to the penalty.
Former Floor Clerk Disciplined for Initiating Trades on the Floor and Related
Violations
James J. Dolan of Henderson, Nev., a former floor clerk, consented without admitting or
denying guilt to findings that, among other violations, he caused the execution of trades on
the floor that did not originate from any customer.
� An NYSE hearing panel found that, on April 3, 1997, Dolan caused trades to be executed
on the Exchange floor that did not originate from any customer. The panel found that Dolan
time-stamped two orders tickets to sell short shares of a stock and thereafter arranged for
such trades to be placed in error accounts at other firms in an effort to conceal losses from
such trades that ultimately became the responsibility of his member employer. The panel
also found that Dolan effected these transactions for his own benefit when he was not
authorized to transact this kind of business on the floor, made misstatements and/or
omissions to various individuals, including members and employees of member firms, and
made unauthorized use of the error account of his member firm employer.
The NYSE imposed a penalty of a censure and four-year bar. Dolan consented to the
penalty.
Individuals Disciplined for Sales Practice Misconduct and Other Infractions
James Alexander Hopkins of Huntington Station, N.Y., a former registered
representative, consented without admitting or denying guilt to findings that he engaged in
sales practice misconduct in five customer accounts.
� An NYSE hearing panel found that, during February-September 1996, Hopkins effected
unauthorized transactions in customer accounts; provided customers with inaccurate written
summaries of transactions and account status; made material misstatements to customers
about the status of such customers' accounts; sent correspondence to customers without
prior supervisory review and made a material misstatement to the firm regarding
correspondence that he had sent to a customer without prior supervisory review; and agreed
to share and shared in losses in customer accounts after such losses were incurred.
The NYSE imposed a penalty of a censure and three-year bar. Hopkins consented to the
penalty.
John Duran of San Francisco, Calif., a former registered representative, consented
without admitting or denying guilt to findings that he engaged in sales practice misconduct
in three customer accounts.
� An NYSE hearing panel found that, during 1995-1997, Duran engaged in unauthorized and
unsuitable trading in the accounts of three customers and failed to follow the instructions of
the customers.
The NYSE imposed a penalty of a censure and 10-month bar. Duran consented to the
penalty.
Ned R. Somers of New York City, a registered representative, consented without
admitting or denying guilt to findings that he engaged in sales practice misconduct in three
customer accounts, among other violations.
� An NYSE hearing panel found that, during 1988-1995, Somers effected transactions in the
accounts of three customers that were unsuitable in view of the customers' investment
objectives, investment experience or financial resources, entered inaccurate information on
the books and records of his member firm employer and represented to two of the customers
that he would guarantee the profitability of the account.
The NYSE imposed a penalty of a censure and four-month suspension. Somers consented to
the penalty.
David Ferdinandi of Fresno, Calif., a registered representative, consented without
admitting or denying guilt to findings that he engaged in sales practice misconduct in the
accounts of two customers.
� An NYSE hearing panel found that, during May 1991-January 1996, Ferdinandi effected
unauthorized and unsuitable trades in the accounts of two customers of his member firm
employer. The panel also found that he effected trades in one of these customer's accounts
that were excessive in light of the customer's investment experience, objectives and financial
resources and that he shared in the losses in another of the customer's accounts.
The NYSE imposed a penalty of a censure, $10,000 fine and six-week suspension.
Ferdinandi consented to the penalty.
Individuals Disciplined for Unauthorized Outside Business Activities and Other
Violations
Bruce Anthony Hayes of Los Angeles, Calif., a former registered representative,
consented without admitting or denying guilt to findings that, among other things, he
engaged in an outside business activity without making a written request to, and receiving
prior written consent of, his member firm employer.
� An NYSE hearing panel found that, during 1997, Hayes engaged in an outside business
activity, and received $10,000 as a finder's fee, for causing a customer of his member firm
employer to invest $100,000 in a private placement away from the firm, without first
receiving written permission of his firm. The panel also found that Hayes recommended that
the customer sell $100,000 of stocks in her account at the firm and invest the proceeds in
the private placement, and made material misrepresentations or omissions of information to
the customer in connection with the private placement transaction.
The NYSE imposed a penalty of a censure, one-year bar and a requirement to comply with
his undertaking to pay $7,500 to the customer (in addition to the $2,500 he previously paid
to the customer). Hayes consented to the penalty.
Gregg M. S. Berger of Scarsdale, N.Y., a registered representative, consented without
admitting or denying guilt to findings that, among other violations, he engaged in an
outside business without receiving prior written consent of his member firm employer.
� An NYSE hearing panel found that, during September 1993-March 1996, Berger engaged
in unsuitable trading by over concentrating a customer in one security and recommending
that the customer invest in an unapproved outside business without receiving the written
consent of his member firm employer. The panel also found that Berger exercised
discretionary power in the customer's account without first obtaining written authorization.
The NYSE imposed a penalty of a censure, two-month suspension and $5,000 fine. Berger
consented to the penalty.
Michael Gallagher of Matawan, N.J., a clerk on the trading floor, consented without
admitting or denying guilt to findings that, among other things, he engaged in an outside
business activity, and was compensated by another person, without making a written
request and receiving the prior written approval of his member firm employer.
� An NYSE hearing panel found that, from May-October 1997, Gallagher maintained and
effected personal securities transactions in an account at a non-member broker-dealer but
failed to obtain the written consent of his member firm employer to maintain the account
and also failed to have duplicate confirmations and monthly statements sent to his member
firm employer. The panel also found that, from approximately May 1997-February 1998,
Gallagher was employed by two independent floor brokers to process order tickets without
requesting or obtaining the consent of the firm.
� The hearing panel found that Gallagher provided inaccurate answers to the firm on an
employee annual compliance notification form with regard to these matters.
The NYSE imposed a penalty of a censure, $5,000 fine and a six-week suspension.
Gallagher consented to the penalty.
After a contested hearing, Dennis Charles Koenning of Acworth, Ga., a former registered
representative, was found guilty of engaging in a business without making a written request
and receiving prior written consent of his member firm employer.
� An NYSE hearing panel found that, in September 1966, Koenning entered into an
arrangement in which he would lease cars and then sublease them through a company to
third parties who were unable to lease a car because of their poor credit history and were
willing to pay the company a premium to lease a car. The panel found that the company
and Koenning would then split the down payments paid by the third parties as well as that
portion of all monthly premiums on the subleases that exceeded the monthly premiums on
the primary leases. The panel found that, in late 1996, Koenning was compensated for
subleasing four cars through the company but did not make a written request and receive
prior written consent of his member firm employer concerning his relationship with either
the president of the company or the company itself.
The NYSE imposed a penalty on Koenning of a censure.
Individuals Barred for Misappropriation and OtherViolations
Philip Cooper of Lauder Hill, Fla., a former registered representative, was found guilty of
misappropriating funds belonging to a customer of his member firm employer, attempting
to misappropriate funds from another customer and failing to comply with a written request
by the Exchange for information.
� An NYSE hearing panel found that, in October 1998, Cooper attempted to misappropriate
$2.1 million from a customer of his member firm employer by processing a request, and
other related documents, for an unauthorized wire transfer of the funds. The panel also found
that, during November 1997-September 1998, Cooper misappropriated a total of $66,100
from a customer's joint money-market accounts.
� The hearing panel found that Cooper did not comply with the request by the NYSE
division of enforcement for his testimony.
The NYSE imposed a penalty on Cooper of a censure and permanent bar.
Victor E. Catalano of Laurel, N.Y., a former branch office manager, consented without
admitting or denying guilt to findings that, among other things, he misappropriated funds
belonging to a customer of his member firm employer.
I agree with your analysis on Vengold/Itemus as an internet incubator but don't they still own a substantial chunk of Lihir? If there is a decent run-up in gold (ha!), wouldn't their stock price benefit from this?
Kaplan reports three major brokerages downgraded gold shares this morning. But the shares held up nicely nonetheless. I like that kind of action. Very encouraging if it continues.
Re: the market -- money now is pouring into value stocks (not just the Dow) -- and these should do well for a few weeks at least. Many of the non-Dow value stocks are reasonably valued at 10-15 times earnings.
But this most certainly is not a new bull market in these issues. The ongoing value rally will not last long and probably is the final hook before a genuine bear begins.
Gold Market Rigging at Its Finest, Courtesy of Wall Street
Yes, Old Gold, The Clinton government and its bullion bank masters did another masterful job of rigging the gold market today. Categorical, clear cut market rigging...nothing less. Again, if I ever hear another Clintonite tell me about the wonderful FREE financial markets in this country, I will barf all over their corrupt stolen shoes.
First, of course, the obligatory central bank gold sale announcement (WITHOUT any mention of the Washington Agreement and the fact that Austria's intended gold sales must occur within the guidelines of that agreement...hence, a ZERO increase in the annual amount of European gold sales over the next several years). Of course, the Austrian gold sale announcement was designed to be released on the exact day when the decision concerning the government case against Microsoft would be released, thus ensuring a very weak day in the NASDAQ.
Naturally, the bullion banks and their obedient Clinton government pigeons made certain that, on such a weak Nasdaq day, there would not be any dollars fleeing toward gold. They achieved their goal via the Austrian gold sale announcement PLUS the various downgrades of several gold mining companies released today. It's that simple.
Again, any gold investor who has watched these kinds of blatant relentless examples of unmitigated market rigging over the past several years...any gold investor who has lost huge amounts of money in such a rigged market...OUGHT TO BE MAD AS HELL!!
If you are not mad as hell, then you must dead or dying.
Get off your butts and raise a ruckus. Here's one suggestion:
In posts, I provided earlier today, you should blast Jon Corzine, former senior partner of Goldman Sachs, who hopes to be the next Senator of New Jersey. Let this guy know in no uncertain terms what you think of Goldman Sachs and the gleeful manner in which the bullion banks have robbed you of your money via the nefarious gold carry trade.
Here are E-MAILS for the man's two campaign managers:
PHOS...Vengold aka Itemus is NO LONGER in the Gold Biz.
From their latest financial report released the a few days ago:
"For the year ended December 31, 1999, Vengold incurred a net loss of US$107.8 million (US$0.75 per share) compared
to a net loss of $14.4 million (US$0.11 per share) in 1998. The loss in 1999 was entirely attributable to losses
incurred on the Company's investments in the mining sector. The Company's mining investments will be treated as a
discontinued operation in future periods.
At December 31, 1999, the Company held cash of US$11 million, and bank debt of US$10 million. At the present time and
following the recent financing, the Company has bank debt of US$12 million, a cash balance of US$35 million and the
Company holds 54 million shares in Lihir Gold Limited (AUS:LHG) valued at approximately US$23 million.
Subsequent to year-end, the company stated its intention to redeploy assets from the natural resource industry to the
technology sector and concurrently announced the hiring of a core management team led by Mr. Jim Tobin, former
Chairman and founder of BCE Emergis. The Company also announced a name change to itemus inc."
-----------------------------------------------
It is my understanding that the company will dispose of all its Lihir stock ASAP and use the proceeds for its internet incubator fund.
PHOS...and here's the reason Vengold's been so weak.
On March 30, Company announced the following:
"Vengold also said it has received regulatory approval to acquired a private e-commerce incubation company controlled by
its president and chief executive, Jim Tobin, for 15.25 million shares, valued at C$12.8 million."
----------------
PHOS, basically, the market is nervous as this appears to be a most egregious example of self-dealing by the senior corporate officer, to the detriment of the shareholders. The concerned shareholders are dumping the stock like crazy.
Re: Platinum .Chairman Yuri Kotlyar ( Norilsk Nickel),
still hasnt the foggy-ist when shipments would resume out of Russia. source: Alan Murphy Platinum Guild......
Meanwhile The National Union of Mine Workers (25,000) in South Africa may start labour action ( the usual hoo ha) if negs with Amplants arn't successful. Notwithstanding that
according to the Platinum Guild in 1999 53% or 88 tons
of the worlds PT mining output went into making PT Jewelry
with a seems-so reviveing demand in Japan and a 37% increase in China last year. Since 1976 the earliest year for records included in the online database some 69,053 US patent awarded reference PT in some way.
Gold is beautiful , Platinum is nothing less than incredibly useful !. Pt Pd Ag and Au get yea the LOT !!!!.
Black Blade are you still kicking ?. :).
Tommorow the mendacious scum of the Treasury will NO Doubt
be in a BUYING mood, hankerin' for some Nasdaq to keep the yokels all happy, all at the expense of gold. I've recently began to wonder if there isn't a gold stock shorting program running in the background as well?
The word is that Louis Freeh will announce his "retirement" as director of the FBI. Well, better to leave now I suppose, than risk the humiliation of being run off after the next election. I wonder if he will leave Deputy Direktor Herr Larry Potts, the Hero of Ruby Ridge, in charge? Oh, well, I guess that isn't very fair is it? The real HERO of Ruby Ridge was FBI sniper Lon Horiuchi, who shot Vicki Weaver in the face while she held her baby in the doorway of the families cabin. Lon Horiuchi, there's a real G-man! Put him in charge, Louie. There have been days when I wondered if we would ever get America back. Good riddance maggot.
Your description:
"You see, many mutual funds are compelled by their charter to keep a certain percentage of their funds in stocks. They simply can not flee to the sidelines or jump ship, but instead must run from one side of the listing ship to the other, back and forth, bailing water but sinking nonetheless in the end."
This may be the most descriptive and accurate
explanation of the so-called equity markets that I have seen or expect to see. This one is worthy of notation by the historians in the years to come.
So let's see. While the Nasdaq bubble deflates, the DJIA bubble inflates. And gold (happily, I may add, does nothing, just more time to add to physical....). Presumably, "Old Economy" (I don't really believe this newspeak, but for the sake of the argument) stocks of companies which make real stuff bought by real consumers, drunk on the hooch of rising "New Economy" stocks, are now a buy. What I don't understand is how anyone looking at the macro situation can fail to realize that once the hooch gets really watered down, and the drunk consumers go into liquidity withdrawal, they will stop buying the stuff made by the "Old Economy." It's one economy stoopid! is all I can come up with. Capital has been misallocated, fueling a consumer boom the likes of which has not been seen in a long long time, and the fuel is about to run out. And this is a reason to buy into the "Old Economy"? Just at the mother of all inflection points in consumer spending? I don't get it. Gotta read more von Mises....
Yes ideed, I'm kickin' and screamin' :-) I wouldn't be surprised to see the PGMs not officially trade on the open market in the foreseeable future. Russia, and the former Soviet Republics are economic basket cases. Any company doing business there will be sorely burned. I had the pleasure(amusement???) of working on a project in Khazakstan some time ago. What the corrupt regimes don't steal, organized(?) crime will, and anything left over the people steal. These governments have no honor (no surprise about that), but anything of value is likely dissappeared faster than an IMF dollar. Personally, I don't believe that there is ANY palladium, or even platinum left, as this was by-product from Norilsk Nickel, and there hasn't really been a need for base metals in Russia since there hasn't been any real production of anything. This country is on the ropes and is ripe for revolution. As far as PGMs are concerned, I would only accumulate physical Platinum, and probably shares of PGM producers (such as Stillwater Mining, or Implats maybe). I've pretty well given up on following the futures markets of PGMs since they are now severely controlled and especially since the TOCOM defaulted last month. This could be a warning of what may come in the gold and silver markets if there is a true short squeeze. Maybe this is why the shorts don't seem to be concerned. Who really knows. Meanwhile, I have been slowly rotating out of my high-flying stocks over the last few weeks, accumulating physical and some mining shares. More analysts are anti-metals, and as the old saying goes "buy while there's blood in the streets...." That said, I'll believe that there's physical PGMs on the open markets when I see it ;-) Take care friend, Black Blade.
Trail Guide here I sit along this trail with you and others on a clear night looking up and watching a star and the darkness thereof that encompasses round about it, or does it ?.
I think I know what you mean by the far and near view the game and the ball. If I take the close view , i.e from a fixed thinking point I simply see the star and the darkness
round about it, but if I take the far view i.e imagining
the self travelling around that star , circumferencing it at infinite speed so theoretically I am at all places at once around it in a sence perhaps arriveing at another fixed point whereby and with all seeing eye , I realise that that beam of light is everywhere with me and thus the darkness like clothes or a veil covering the truth up falls and vanishes.
What the hec why stop there , I am at infinite speed in infinate places at once in the entirety of the universe .
I see that the self is as it were in a lighted room now. In truth the darkness is there but the real truth is that it is not, its counterfeit. I am slow Trail guide but I will catch up with you and Another and Micheal and All. I read and re-read over and over , I think perhaps you are asking us
to come on this trail with you with a quiet mind and that thats part of the trick to understanding this fantastic
journey ?. Anyway the veil is slowely being removed , I feel good. I big thankyou to you FOA, I genuinely sincerely mean that. whatta family !!!!!
hahaha ! Kicking and Screaming you reckon!:).Yes we winge and moan about things alot sometimes but unless one has travelled to some of these places for real (were human life is cheap) its hard to really appreciate how darn lucky us Aussies, Americans and Europeans really are.
Actually I heard through the grapevine myself that not only is Norilsk's mine seriously depleted but indeed the shelves/stores (Old mother hubbard cuboards are bare).that is unless the place is being looted for all its worth for what morsels are left. If this is the case South Africa and
or Still Water must be rubbing there hands togeather. I would love a first hand look at Norilsk secretive outfit to say the least from any mountain top.
Yes TOCOM is dissapointing. Anyone with an IQ of a retarded
bull-ant knows that that sucks to the max !. I asked that question re: Gold and silver a few days ago but didnt get a responce. Anyway friend I get the appetite wet by news of Pt and Pd . These industrial metal fundamentals at least in the near future look very interesting. If they are not being depleted in the mines the're being burnt away. I wonder if "Another" knows whats happening there ? hint hint :).because some of the books or reports on it I have seen for sale I know go into the thousands, to much for this little battler.
Oh incidentially Black Blade I didnt get to Hong Kong as you may have noticed looking for that 25 tonnes in the caves the ol locals alledge the Japanese left behind.
We are on strike , meetings everyday to attend. I dont know why I am always in the minority vote, I am either always wrong or the majority is ?, I am sure the majority is actually stupid, ho hum, such is democracy. and the wife
was all over the planet so I sort of got grounded at home.
Hey Congrat's on the Win !,here. Regards Ray.View
Yesterday's Discussion.
I didn't know some houses had raised margin. It has to be a smart move on there part. In my book it should have been 100% from 1995 on.
I'm sure your right about the plight of the dollar, when it hits the slide look out far below.
I never have been a doomsdayer, but the big picture is looking pretty grim. I'm slowly becoming one. I hope our society can hold together, some days I have my doubts.
I didn't know some houses had raised margin. It has to be a smart move on there part. In my book it should have been 100% from 1995 on.
I'm sure your right about the plight of the dollar, when it hits the slide look out far below.
I never have been a doomsdayer, but the big picture is looking pretty grim. I'm slowly becoming one. I hope our society can hold together, some days I have my doubts.
John Crudele Talks About Market Rotation -- From the NEW YORK POST
http://nypostonline.com/business/2183.htm"Two things need to be said about yesterday's
enormous slide in over-the-counter stocks: One, who
couldn't see this coming? And, two, it had nothing to
do with a Federal judge's decision on Microsoft.
Judge Thomas Penfield Jackson's decision that
Microsoft broke the nation's monopoly laws should
have been good for all the technology shares that make
up the Nasdaq index.
These comments were inspired after Fafel suggested (Msg ID:27997):
"Again, any gold investor who has watched these kinds of blatant relentless examples of unmitigated market rigging over the past several years...any gold investor who has lost huge amounts of money in such a rigged market...OUGHT TO BE MAD AS HELL!! If you are not mad as hell, then you must dead or dying."
An evaluation of my calm emotional state compels me to request that somebody please send flowers and condolences to my grieving family.
While not entangling Farfel, or anyone else necessarily, consider this. A person of similar disposition to the one portrayed by Farfel in the above passage might at some point be seen to take it upon himself to relocate to the far side of the City where events are more peaceful and conducted at a pleasant pace. Available methods of transport are his own shoes, the municipal buses, and the yellow taxi cabs. Long ago, as he set out to achieve his goal to come to this distant place for final relaxation, he had at the time only enough extra money to accommodate bus fare. But he did not know the bus routes or schedules. He was therefore reluctant to jump aboard and perhaps be delivered at a loss to some point yet further away from his destination--requiring more walking than were he now to put one foot in front of the other in continuous and deliberate succession. In a similar manner a person might have long ago perceived investments in the general stock market...an uncertain route of unknown schedule that may or may not deliver you closer to your retirement destination.
But this person "knows" a thing or two about yellow taxi cabs--that they will deliver you at your command and without guesswork directly toward your desired destination. But rather than paying the cab fare, which was at the time more expensive than the bus fare, this traveller perceived an opportunity (because he "knew" a thing or two about cabs) when he saw a sign that said "Drivers wanted."
Ah-HA! This clever traveller would invest (his time) in the yellow taxi cab company, and thereby let his "investment" bring about the source of his deliverance across town. Time wore on as he drove many passengers to THEIR destinations without ever gaining a personal windfall of serving a passenger seeking his same destination to the far side of the City. In time he grew irritated at his bad fortune. His irritation further grew as he became more aware of the bus routes and schedules, seeing signs that some buses did indeed visit his desired destination, though he still could not be sure which buses they were at the time of embarking. He would therefore stick to his "investment" plan with the yellow taxi cab company, anticipating that the desire of others to arrive at that same place would be his grand reward as the wise driver who had strength to bide his time within the company--bacause he "knew" a thing or two about cabs.
And yet that windfall was not in the cards. And the bitterness grew as buses seemed to take everyone everywhere they needed to go, with much media attention devoted to proclaiming the wonder of the municipal bus system's expanded routes--although it must be said in dark alleys that the bus fares were becoming prohibitively expensive, and that some of them occasionally drive over cliffs to plunge into the sea. Adding further to his dismay, he was not sure if the yellow cab company was to blame, or if it was city policy to blame, but somehow the cost of yellow cab fares were being lowered while his overhead for such things as fuel was rising. Not only was he not getting lucky with a "windfall profit" customer delivery to his desired part of the City, neither was he making any profitable, or even sustainable earnings, and his time investment in the yellow taxi cab company yielded only an ever-aging and bitter man staring back each day in the rearview mirror.
So absorbed does he become in his "investment" strategy with the cab Company, and with his contempt for the buses and their passengers, and with the lack of income for honest cab drivers due to declining rates, that he fails to properly reassess the situation with a fresh perspective to take new and appropriate action. To any outsider looking in, the choice is an obvious one to get to the destination effeciently...quit the damn cab company and take advantage of the cheap rates by becoming a direct customer of the yellow taxi cab. Heck, at these rates hire a whole fleet of yellow cabs to take you and all your stuff to your destination on the peaceful, far side of the City. Go ahead. There is no shame in altering your old "investment" strategy in light of a new day. Just as no man can step into the same river twice, the passage of time and the evolution of events ensures that the reasons you did what you did long ago may no longer be deemed the most prudent actions to take today. While your pride may have been hurt by old decisions that did not bear the expected fruit, sticking to the strategy while not re-evaluating present conditions does nothing to improve the situation or to save face. You can instead strive to become the very model of wisdom and composure by either steeling your resolve for the long walk ahead, or else flagging down some cheap Yellow to do thy bidding. Take control.
I'll leave you with a short bit of a post I enjoyed and saved from several months ago. It says it all.
Blue Sky (12/5/99; 19:38:36MDT - Msg ID:20354)
"We've had the freedom of choice to buy or not.
I have chosen to buy.
I now enjoy what I have (waiting for the Helvetias and Confederatios to arrive)."
Hello. Could you please make some destinctions as to what
paper gold markets and physical gold markets actually are?.I particularly do not understand why a mining company, like Homestake, for instance is said to be going to sell into paper market down into oblivian. I understand that LBMA "sets" gold price in dollars and then how players battle it out either long or short in Comex,etc., without sufficient product to back up all claims. If the "price fixing" and paper gold trading is "the Market", where does the refiners like Handy and Harmon,Englehard, Johnson Mathey and Credit Suisse, who get the mine production and then distribute to "real" users draw the line on their selling price in the face of real supply and real demand? What is the market mechanism for distribution on the ECM/BIS end of this, aside from holding in their Central Bank vaults to supply gold to users in the real world? If paper gold market collapses what is it that will transpire to say to the World what is the real "GOLD MARKET"? If what I have asked here is even understandable thankyou for any reply you might give. Also if mining companies are tied to Bullion Banks and LBMA because of financing issues why won't ME money etc., come out of the woodwork to finance mining?
Where do the Middle Easterners keep their physical gold? Does this gold live physically with the FED, or in London, Paris or Zurich? Or is it or Middle Eastern soil? Keeping the amount of gold they own on anywhere but home soil must surely be a very dangerous strategy.
Historically, the ONLY method that large amounts of gold have been moved is by violence, namely by war. Very large movements of gold seldom occur peacefully. There's just an awful lot of movement lately and things still 'appear' quite 'stable'.
Silverbaron (WOW - exporting gold from the U. S. must be a good business lately.......) ID#297352:
Copyright � 1999 Silverbaron/Kitco Inc. All rights reserved
Data is NET exports = ( exports-imports ) of Gold from the U.S., in Metric Tons/month
I read somewhere, a while ago, that a lot of the Middle East gold is stored in London (I think the vaults are at Trafalgar Square). I seem to remember reading that they have leased quite a bit of it too. It makes sense to keep it there as the Middle East has had a history of Muslim fundamentalist activities which could cause problems (like losing a lot of it). I wonder, though, if a lot has been leased, what is the likelyhood of getting it back.
http://www.usagold.com/Order_Form.html4/4/00 Indications
�Current
�Change
Gold June Comex
279.60
-0.80
Silver May Comex
5.03
-0.03
30 Yr TBond June CBOT
97~30
+0~04
Dollar Index June NYBOT
105.63
+0.42
Market Report (4/4/00): Gold was down this morning on little in the way of
news.
In watching the market action following the Microsoft decision yesterday and
in today's early going, the question comes to mind: "Where will investment
capital rotate once its discovered that the Dow Jones stocks are overvalued
too?" I understand that the Botswanan Stock Exchange Index is undervalued at
the moment. Maybe some bright fund manager could look there, sell a couple
shares of E-Bay and buy it....Yes, I mean the whole thing.
What's going on now says a great deal about value, i.e., it matters not
anymore. For example, labor is so valued in today's economy that the
businesses which support it can't find the quality employees to keep it open.
When they do, the work is so unreliable and overpriced, they cannot compete
-- kind of like the old Escher masterpiece of the dragon eating its tail.
This morning a landmark Colorado business -- Valas TV (a family enterprise
which began with the television revolution and grew with it) closed its doors
after 59 years in business. Yes, closed its doors in the face of the biggest
electronics boom in history. Why? "The No. 1 reason," said David Valas, son
of its founder, "is the tight labor market. It's been an inability to attract
enough good employees." We deal with a lot of business owners at Centennial
Precious Metals. Hard to say, how many time we've heard that lament over the
last three or four months.
But as in all things there's a downside to all this. The world's paper
currencies are being debased in concert -- a grand concert -- with the U.S.
dollar in the lead chair. To wit, the Japanese central bank continued its
assault on the yen today driving the dollar index up -- a central bank
attacking its own currency! Now, what would keep an enterprising U.S.fund
manager from taking advantage of the strong dollar and going in and buying
most of the Japanese electronics industry (for example) -- lock, stock and
barrel -- as we say in this part of the world. Well, you say, the Japanese
have tight control on take-over activity. That's an interesting strategy --
debase your currency then don't let anybody buy anything with it. Very much
unlike U.S. policy which has determined that debasing your currency and
selling your country with it adds up to good economic policy.
But of course with all the coyotes out there, the stock of prey is running
out anyway -- Japanese electronics notwitstanding. All of which, brings me to
a piece of wisdom printed in the letters section of the Denver Post this
morning undoubtedly traceable to one of those leathery, old cowboy types who
still live amidst these purple mountain majesties:
"If there were but three animals left on earth, two would be coyotes and they
would be chasing the third." Though a testament to the tenacity of the
coyote, perhaps the two would do each other mortal harm fighting over the
third. Perhaps that third -- still standing -- would be yellow metal,the
glitter of which cannot be extinguished by even the most rabid defenders of
this ill-bred and dying international monetary system. Everything else seems
to be in the process of being debased to the status of non-value. For the
private investor, perhaps a little rotation in the direction of gold -- the
one asset which is not simultaneously someone else's liability -- is
warranted. We'll sit back then and watch the coyotes tear each other up. Gold
owners generally enjoy good sport, wouldn't you say?
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.
News blurb found on Excite page in the investments section under world news.
"Finance ministers must reform the global financial system before U.S. economic fragility threatens emerging market economies, urged the Institute of International Finance, which represents more than 300 big financial institutions:FT"
My biggest clue of this NASDAQ debacle came from a cousin of mine.
He had been invested in a variety of VSE mining stocks plus standard Old Economy "non-performers" for the past seven years.
He phoned me two weeks ago and told me he had moved ALL his investment monies into internet funds...this after avoiding them completely in the past.
His words to me: "it looks like the internet is here to stay."
What amused me most about that statement is this: my cousin has never owned a computer, he has never been on the internet, has NO E-Mail, and I think he would be hard pressed to say exactly what the internet is.
Instead, he was just another poor schmuck who grew envious of his friends big tech gains....and whose expenses were outstripping his Old Economy stock gains.
As much as I love the guy, he is a classic example of the dumb money that has powered this market for the past several years...and unless the laws of markets are repealed, dumb money always gets massacred in the end.
http://www.kitco.com/gold.graph.htmlIs this the BIG reallocation of assets we've been waiting all these years for?? All U.S. Stock markets in Crash mode Big Time!!! Gold just went up almost $10.00 per ounce....beesting.
Isn't it amazing how for all the pundit talk of "gold has stiff resistance at $281, blah blah.." it blows to $291 in 30 minutes ! Another lesson learned. Just when you are ready to throw computer through CNBC monitor it happens. My motto is now "fade Pisani".
Crack-up boom in stock paper. Dow down 415 or 3.7%, S&P down 70.09, NASDAQ down 456 or 10.6%. Inktome lost 24% of market value just today. Anyone surprised? Anyone want to trade their gold for some stocks?
PPT out in full force for a couple of mins now. Managed only to slow the fall a little so far. Specs are selling futures back to the PPT. In the minutes without support the markets decline from individual selling.
Premium just crashed.
PPT back in.
Note that the dollar is relatively unaffected, which is surprising. I guess the PPT has that to keep them occupied.
Vengold, I hung on to 25% of the initial stake. At current levels, we are close to the NAV for their Lihir shares (priced for POG $300) and cash.
Short fund has mitigated against most of the losses in the minor position remaining.
Finally, VENGF is still not a bargain by any stretch of the imagination right now.
Fed not involved in bank reserve operations today, but seen buying $9.5 billion in U.S. Govt securities
http://biz.yahoo.com/rf/000404/l2.htmlDealers said the Fed bought $3 billion in Treasury bills and $6.5 in coupons...most likely on behalf of the Bank of Japan as their forex intervention leaves them with a pile of dollars needing an avenue of investment. How many other institutional entities are using this activity by Japan as their divine exit opportunity from their own vast holdings of U.S. debt paper. (Such institutions could also be capitalizing on the millions of misguided Wall St. investors that are blindly choosing the bond market as their flight to safety. These institutional (international(?)) entities could be selling their own bonds once and for all into this unique bond rally at the best possible price.)
Meanwhile in Japan, while last year the first three days of April saw a net inflow of 1.2 billion yen to the postal saving system, this year upon the maturity of 3.4 billion yen in 10-year fixed rate term deposits, there was a net outflow of 720 billion yen. With a whopping 106 trillion yen in similar 10-year notes set to mature over the next two years, analysts are expecting a goodly portion of this freed cash not to be reinvested in the postal savings system, but instead to flow into other investment opportunities. Possibly gold among others?
For the last few years the U.S. economy/stock market has been supported by hi-tech stocks, most note-ably Microsoft and Mr Bill Gates. So, in this election year I don't think this was a planned event--breaking up Microsoft! Look at the current results in the stock markets today. A day of historic preportions to the downside. The question is will the smart money turn to Gold finally?
I'm glad I've got Gold in hand, right now.....beesting.
http://biz.yahoo.com/rf/000404/wc.htmlNEW YORK, April 4 (Reuters) - New York gold futures rallied sharply to their highest level in two weeks early Tuesday afternoon as investors stampeded from plunging Wall Street stocks into more secure assets, dealers said.
At 1311 EDT on the COMEX, benchmark gold for June delivery was up $7.60 at $288 an ounce, having reversed early slippage and powered above important chart resistance at $290 to $291.50, its highest since March 21.
The move into gold, historically considered a store of value in times of financial market crisis, came as falling technology shares sent the Nasdaq stock index into near freefall, to stand down 574 points, almost 14 percent, by mid afternoon.
jinx44 (03/21/00; 22:08:04MDT - Msg ID:27255)
The Ben post at Gold-Eagle
I just read this at Gold-Eagle; thanks Leigh for the FYI. This is the kind of prognostication that I could really take a liking
towards. One of these days the madness around us must stop...........
FROM GOLD_EAGLE------Good Evening Everyone....
(Ben) Mar 21, 21:35
I will try to best address everyones comments/questions the best that I can.
First, to the gentlemen who asked about my credibility:
I offer you this:
-I am in my early thirties.
-I have an MBA in finance from the University of MD.
-I am a investment analyst/money manager (my title is CFO) for a automotive consulting firm that I own a portion of here in
MD. I actively invest company funds. We do consulting work/training/software development for our clients who own car
dealerships and repair chains all over the US and Canada. We have developers/programmers on retainer that we hired years
back to help me build the models/databases after I got out of Grad school
-I have been trading/investing/gambling (psyche!) for most of my life. My father opened an investment account that I traded
when I was twelve years old. I didn't do that great for several years, but learned quite a bit.
-I have owned and worked in several businesses over my adult life but have always been active in the various investment
mediums. It is all that I have ever liked.
- I am a contrarian at heart.
Secondly,
My outlook is not one of Armageddon. So don't look to using gold bullion and coins for barter. What I am seeing is what I
believe will ultimately turn out to be a mass exodus from the US dollar and the US stock markets by most foreigners and
strong hands (the trade). This will turn out to be the most well needed corrective move in history as the equity markets are out
of control. If I see some basing action after the dump and some weak sentiment, I may be a buyer. Don't think that I hate the
US stock market. I do not. In fact I love the stock market.....but it has become an out of control, rabid, sick animal that has
resorted to scraping the bottom of the barrel to raise capital. It needs this. Gold stocks will probably take an initial
hit....maybe not. It depends how quickly Gold reacts. Most precious metals will do well. Gold will do best. The potential
returns are better and it can be moved/sold/stored/recognized by banks very easily. Gold stocks, options on futures, futures,
and bullion will all do well. Naturally the safer the choice of the above will offer the lowest returns but better nights sleep. :)
The energy complex, on the other hand, could get a little hairy. Hard to say. Personally, I believe the move has already
occured. I was a strong buyer last year at 12.50/barrel when everyone thought I was crazy. If the dollar collapses, profits of
US based oil companies could suffer and in turn not offer great returns. That is pure speculation, however. I am holding
some way out of the money Oil calls that will probably not do much.
To phos:
We use all of the conventional tech tools....Gann, Elliot, Fib #'s, Moving Averages, the whole shebang. A good portion of
our analysis measures how price and volume relate to one another in many different situations that would take two hundred
pages to explain. One simple facet that you can see for yourself that we measure is how a market shows signs of weakness
when it takes more volume to move a certain stock or index during successive periods. That is just the tip of the iceberg,
however. Just an example.
Now, here is my original post again:
*UPDATE*.......
(Ben) Mar 21, 15:17
I don't know if you all are interested or not, but the crap is about to hit the fan in the equities.....will give full report tonight.
EVERY SINGLE MODEL, DATABASE AND PROJECTION CHART IS SHOWING FULL SCALE MELTDOWN IN
TEXTBOOK FORM. JUST GOT THE MOST POWERFUL SELL SIGNAL SINCE 1929 (Our models have run full scale
simulations based on that time period and generated the same signals before they were fed the data showing declining prices
and the ensuing crash of '29). If you remember, my original post stated that within three weeks we would have a major
collapse. Well, ladies and gentlemen, we are within 10-14 days now. I know it may be a little extended from my original
post, but I didn't anticipate such a STRONG rebound from the lows of the 97-9800 area. This tells us that we should have a
day or two more (tops) of this rebound, followed by a small collapse taking out the low about ten days ago to around
9100-9400. We could see a small rally lasting maybe a one to three days off of this new low and then..........KABOOM!
Forget the PPT, forget the 401k money....It's over and you can bank on that.
The U.S. Dollar should move almost in step with all of this madness which will create.....you guessed it.... A freaking
GOLD rush NEVER BEFORE SEEN.
I will post this message once more this evening and that will be it for a while.....we are in position and will just wait and
watch. It may be my last post. I told you I would not post anymore if things did not unfold almost exactly as posted. I am
that confident in the signals we are seeing.
By the way....you may be wondering on some specifics of where this action would leave the DOW and GOLD in terms of
numbers.
We are seeing the Dow settling around 5-6000 and Gold having several limit days initially followed by a small selloff (profit
taking) and then ....to the moon again but more gradual and reminiscent of a true BULL.
For what it's worth to you all....even if it is a laugh.
We aren't laughing here, however.
If you have loved ones in this thing....get them out and do it quick. There isn't much time.
Someone bought a 167000 position in one go about 20 mins ago.
That is a 20 million trade.
Another 150000 block traded at 14:00
Premium continues to swing wildly from well above fair value during PPT interventions to well below fair value during the arbitrageur spread trading. The stable level seems to be squarely below fair value - indicating spec liquidation and fresh shorting of this rebound.
This was expected: White House says U.S. fundamentals remain strong
http://biz.yahoo.com/rf/000404/xm.htmlReuters reports that a top White House economic aide, Gene Sperling, chairman of the White House National Economic Council told reporters today "We believe that the very fundamentals of our economy look still very, very strong." He added, "The underlying fundamentals of our economy remain quite strong. Obviously we monitor all of the variables out there, certainly oil prices have been something we've been monitoring .. and certainly we will monitor developments in the market as well."
Be that as it may, if they feel compelled to jawbone the markets, where was their official voice of concern when asset prices started to become bubbly? The Fed Chairman has been the only voice, in December 1996, saying he saw signs of "irrational exuberance."
I just noticed that these trades float above the market - just above ask.
Saw another 50000 order
Sell orders with a note of "depth on offer" indicating willingness to sell by a large holder.
SP premiums held at good premiums over fair value in one more spurt of support.
-------------------
Town Crier
We don't have economic fundumentals within the US. The bulk of our economy is importation of the "good fundumentals" of the exporting nations (20-25% of economy) and trading of them, coupled with the trade and export of paper of all sorts and real estate (25% of economy).
We have only the demand portion of fundumentals.
We have only the inventory and transport part of "supply", and technology is reducing the importance of this portion by reducing some of the costs of distribution.
Marcia.....Too Near The Truth? YES!...IMO....YGM. PPT = ESF? �
(Marcia)Apr 04, 14:45 Do you suppose the money that the PPT uses to buy the indexes during a crash like today's was acquired by selling gold calls over a period of time? It wouldn't surprise me to learn that the PPT = the ESF. Given the amount of foreign money in our markets, it wouldn't be a surprise at all if the ESF considers the stock markets within their purview. Who else could it be throwing money at the indexes and pushing the NASDAQ from -540 to -160 in a couple of hours? That's BIG money. And today's coitus interruptus in spot gold coincides perfectly with NASDAQ's return from the abyss.
Blatant manipulation for political purposes to try to keep the market alive until after the election. After yesterday's and today's action, I don't think they can. We'll see.
I predict a strong downdraft towards 3-3:30 pm - unless the markets are halted that time!
Really appreciate your play by play updates with respect to volume and movement- don't stop; I have no TV, so I am missing all the "excitement" other than the forum.
If you get a chance (after the music stops), I'd be curious to get your impressions as to how long Da Boyz can keep ahead of the pack- ie. can they buy this market indefinetly?
Interesting to note that during the dollar plunge an hour or so ago, USD/SDR briefly popped out of the 1.34-1.35 range. It hit around 1.3528 if I remember correctly. Now it's safely back inside.
The table below can be used for easy reference given different values of the euro:
Assume GBPUSD=1.5950.
EURUSD=value; USDJPY=min , max
EURUSD=0.94; USDJPY=100.90, 104.75
EURUSD=0.95; USDJPY=102.20, 106.20
EURUSD=0.96; USDJPY=103.55, 107.65
EURUSD=0.97; USDJPY=105.00, 109.20
EURUSD=0.98; USDJPY=106.40, 110.75
I would greatly appreciate it if you could explain exactly how the PPT turns the market. I understand that they buy the S&P Premium. What exactly is this and why does it so influence the buying patterns? Apologies if this has been explained before. If so, maybe someone could point me to the explanation. Thanks
Theoretically, a person or a PPT can move these markets by buying heavily the futures, thus causing a difference between the cash and futures. Arbitrageurs then step in and buy the cash (underlying securities), and thus the cash index moves up or stops falling. There are some twists, but that's the gist of what, in theory, the PPT does. Note: this works in all markets that have derivatives or futures associated with them. I understand that the PPT is made up of money-center bankers (in addition to treasury officials), so I'd assume their wherewithal to buy these futures are virtually unlimited.
The PPT can move these markets as long as there are arbitrageurs willing and able to make money on the spread between the futures and cash. Whether this can go on indefinitely is something I think we'll see very soon.
As stated in earlier posts, intermediate cycles pointed to the week of March 27th through April 3rd as the most likely time for stocks to top and then start down. Well, the markets came in on cue with a little help from Janet "Rambo" Reno and the "Plunge Microsoft Team." Actually, it amazes me how such events just seem to come together at the critical time, panic strikes and the herd thunders in the opposite direction. Synergy, synergy! Gold finally showed signs of its old self and jumped $11.40 at one point before the PPT came in to rescue the DOW and SP 500. The carnage in the NASDAQ appears massive and may not spring back for a long time. Margin calls are going out today and tomorrow and should add to further selling of all markets. By Thursday or Friday, stocks should seek out a lower level and gold will hopefully be in its uptrend again. Over the next few months, I expect stocks to decline even more which should feed the gold rally. It is time to load the boat with gold before everyone else rushes in to buy.
Having been lurkers for a over a year now, we (as a couple) began to wonder just if we have been brain washed by reading USAGOLD as faithfully as we do, and wonder if gold is worth the price that one must pay for it. Here's a capsule of one aspect that we lookied at in the myriad of facts out there. If you'll spare us the space and time, here it is:
ECONOMICS 101: "An introduction to "Why Gold is a better than just a Good Deal"
According to the 2000 World Almanac there are 10 Indexes that are used as economic indicators to project the U.S. economy's performance. The 10 indexes are the following: (quote)
1. Average weekly hours of production workers in manufacturing
2. Average weekly initial claims for unemployment insurance, state programs
3. Manufacturer's new orders for consumer goods and materials, adjusted for inflation
4. Vendor performance (slower deliveries diffusion index)
5. Manufacturer's new orders, non-defense capital goods industries, adjusted for inflation
6. New private housing units authorized by local building permits
7. Stock prices, 500 common stocks
8. Money supply: M-2 adjusted for inflation
9. Interest rate spread, 10-yr. Treasury bonds less federal funds
10. Consumer expectations (researched by Univ. of Michigan)
In addition to those listed above, many use the Consumer Price Index (CPI) as an indicator for inflation.
The CPI takes the average cost of certain items (today it is divided into 8 different groups: Food, Housing, Apparel, Transportation, Medical Care, Recreation , Other Goods, and Services.) From here on out I will only use the figures from the composite CPI that weighs "all items".
The CPI is a peculiar instrument. It has re-set it's baseline values at least twice since it was created. The CPI in use today is valued using the years of 1982-84 as their base line (i.e. the value of the average of these years' CPI is now considered to be equal to $1.00.)
<< For those who like analogies, I liken this to being in a race as a child and just as you near the finish line and you are win the race by touching the tree you stare at in amazement as the other child RACES past you as he says, "That tree's not the finish line, but this one is�..he touches and "wins". It does not matter if you challenge the other child to another race because it will always end up the same and you will never win. Note, these re-valuations enable all sorts of creative statistics by economists.>>
At any rate, on p.112 of the 2000 World Almanac there is a table of the CPI from 1915-1999 using the year 1967 as their base-line value (i.e. the value of the CPI of 1967 is used as being equal to $1.00)
These values reveal the astounding inflation that we are dealing with. Just take a look. For fun I tacked on the Price of silver and oil too -J.
Year CPI Avg POG AvgPOSilver Retail Price of Gasoline (unleaded regular)
1915 .304 20.72 .561 not avail
1920 .60 20.68 .655 not avail
1935 .411 34.84 .584 not avail
1945 .539 34.71 .708 not avail
1960 .887 35.27 .914 not avail
1967 1.00 34.95 2.06 not avail
1970 1.163 35.94 1.635 not avail
1975 1.612 161.02 4.085 61.4 (1976)
1980 2.488 612.56 16.39 124.5
1985 3.222 317.26 5.88 120.2
1995 4.565 384.17 5.14 114.7
1999 4.955 278.88 5.21 107.0
Now, what does the CPI have to do with the POG???
We are dealing with 495% inflation since 1967!!!! Simply put, the $300 (rounded to make calculations easier) that I put into an ounce of gold today is roughly equivelent to $60 an ounce in 1967 (what was the POG in 1967? $34.95.) Let's take another year after the infamous cut from the gold standard. The $300 an ounce I pay today would have been $195.15 for an ounce of gold in 1985 (POG in 1985 was $383.51) Conclusion, we are able to buy an ounce of gold for less in real $ than we have been able to since the cut from the gold standard.
http://www.programtrading.com/The Premium or Spread is the difference between the futures and cash index values. As the index future approaches expiration the premium goes to zero.
http://biz.yahoo.com/rf/000404/0d.htmlThe contrast of the carefully planned gradual introduction of the euro in phases to replace the various European national currencies VERSUS this situation in Ecuador...
HEADLINE: Ecuadoreans confused as dollars replace local currency
An electronic goods salesman in the capital city Quito said, "I don't have any idea how to work with the dollar. I think they should have given us instructions on how to do this."
In response to an embattled national currency, the Ecuadorean Sucre, (which had reached an annualized inflation rate of 80%) the government passed a law in March to adopt the U.S. dollar as its main currency, with sucres to remain for a time to facilitate small purchases. The fixed exchange rate is 25,000 sucres per one dollar, and cash machines are already spitting out the green bills. The problem is that, according to Reuters, only 1 in 5 citizens "has ever seen a dollar bill in their life, and 50 percent of the population has no idea what 'dollarization' is."
What a fiasco. Although television ads have been run to educate the citizens, and to help them combat a real problem of people pawning off bogus dollars to the unfamiliarized citizens, the plan remains ill-conceived. One woman said, "I don't understand this dollarization business, so I'm confused as to how I'm going to make money. I don't know what dollarization is going to be like and what they say on television I don't understand." An architect voiced his dismay like this, "People are familiar with the sucre. Within it is narrated part of our history. Now we have these coins with faces that are completely unknown for us, distant from our history, from what we are."
It would appear there was no need to be delicate in this currency transformation because the dollar was already established...the human element was thrown aside with the thought that the burden is on them to adapt via a steep learning curve. Such is the price to be paid when reacting to conditions from a position of desperation as we see in Ecuador but NOT within the Euroland monetary union.
Given what they've done to their own currency, will Ecuador be a net asset or liability to the U.S. dollars?
ORO - enjoy your posts as always.
Vengold's hairbrained scheme to sell their own stock to buy LIHIR stock totally backfired on them last year. With 125M shares outstanding and $21M in cash, with the LIHIR shares equal to VENGF's debt, this company's track record of destroying it own shareholder value is appalling. On 3/31 it issued a press release in which they pretend to have an interest in Itemus assets (or some minimal interest in various "internet" companies). Read it and see if you can make any sense out of it. Whom did they pay how much for what? The good news is that the stock is still trading at about $1.75 and shareholders who saw a stock with about $0.15 book value per share and no legitimate business plan 6 months ago go from $0.50 to $2.50 can still get out. I hesitate to post this since I suspect that there is some private joke here on a thread I havn't seen, but them's the facts. Best wishes.
Delivery notices climbed today by another 284 contracts (28,400 ounces) to bring the total thus far for the month to 9,146 contracts (28.4 tonnes).
April open interest in the gold contract had been reduced to 1,353 after yesterday's session. Meanwhile, open interest in the June contract climbed to 85,924. We'll have to wait until tomorrow to see what the fallout from today's derivative trading action has been.
Any way you slice it, for an individual gold accumulator, it remains a freakish yet wondrous (and surely temporary) condition to be able to purchase and acquire the physical metal at prices dictated by trading among the vast paper supply of gold derivatives. A bargain while this form of market structure lasts. (Please recall the lead example of the Dutch and Austrian central banks for their latest gold mobilizations. They made no effort to conceal that they were opting to use the BIS to facilitate their necessary allocations.) If you hold your apparent wealth in dollars, then verily, your fate is not in your own hands.
Utterly amazing action in the markets today! Why would anyone (not dead from the neck up) invest in this sort of vehicle with hard earned product from labor? I know the long term, big picture but this (wild gyrations) is getting ridiculous.
Perhaps Mr. Greenspan doesn't discuss valuations in the context of "irrational exuberance" anymore becasue he knows the markets have reached the point of no return; i.e., a critical mass truly too big to let fail. Of course, the larger problem I think is what might happen if the markets do fail.
Just remember that the US$ price of gold in 1960 (ie $34.95) was also a smoke & mirrors mirage that the Europeans (particularly the French) defrocked by patiently converting their trade dollars at the then "gold window", until one day the US (Nixon) couldn't take it any more and finally defaulted! Come to think of it the last 70+ years of US financial/banking history has involved a almost continues manipulation/management of the "currency value" of gold as relative to the US dollar! I THINK ITS NOW OVER!
GOLD IS PRECIOUS
You brought up an interesting point... are the markets too big to fail. Today's activity certainly provides support for such a claim. If so, then why not jump on the band wagon? Hedging the bet with ownership of physical gold of course. Or is there a limit to this kind of manipulation? Hard to imagine with the manipulators in control of the printing presses.
Also, doesn't the PPT behavior seem to be inconsistent with Greenspan's whining about excessive exuberance? Isn't this a classic example of moral hazard?
"IYHO, is it prudent to rotate out of dollars into metal if only until the storm passes?"
You will agree that is a tough one to speak about in any semblance of absolutes. With that said, my response...
It depends on the nature of the "storm" and the new reality of the aftermath of its passing.
Think of a dollar wealthy man as a plantation owner rich in tobacco. Prior to the storm (hurricane?) he might be well advised to pull in his leafy stuff and ship it off while it yet has value in exchange for something (gold?) that can weather the storm.
When the new day dawns, he must look at the remains of the day. Perhaps the landscape is no longer suitable for raising tobacco leaf. Perhaps rice paddies become the obvious choice when that day arrives. He will have to wait and see. At any rate, he will have the means (gold) by which to pursue his choice. His neighbor who watched his own fields and warehouses of tobacco leaf blow away will not be so resilient. Having a portion of wealth in a universal hard asset would have improved his prospects going forward. Can he buy rice if he has only rotting tobacco? Or if the familiar landscape survives, can he acquire new tobacco seeds when all he has is soggy, rotten leaves and barren ground?
To further help answer your question, place yourself within the borders of Ecuador. You have seen your sucre currency severely devalue (greatly destroying the purchasing power of your savings) such that the government has stepped in to change the currency to the dollar.
Clearly, the particular outcome of this storm is different than the outcome of the devaluation storm that visited other nations. But does this dollarization mark the end of the storm or only a phase of one larger? It must come under judgement of the day and place you find yourself.
But to help further, in theory ask yourself this as though you were randomly set down in any (possibly Third World?) nation of the world: what purpose is served by currency in and of itself? . . . What are its vulnerabilities, and can you contol them? . . . What directly facilitates your ability to live another day (assuming good health)? . . . How can you represent many physical assets in a small, easily portable and tradable form? . . . When you carefully evaluate the subtle trends among the leading "powers" of the world, do you get the sense that your local answers to these questions would stand you in good form to participate in the world economy, or would you likely be left behind? Can you produce either from savings or from your own mind or your own two hands something that the rest of the world demands? If so, you will likely be able to meet your needs.
I have been reading and learning from this forum for two months now, and would like to know how this crash and the jump in gold affects mutual funds ie: precious metals funds.
I have a portion of my investments in there, buying low before the last two spikes in the last few months.
PS: The info that is posted here is great. In two months, I have heard "tips" on this forum, and I invested "imaginary money" according to these tips, and so far up about 10% + 16.67%. Not bad for 2 months...not bad at all!
April 3 .. Man Ray Table .... In short , the extraordinary contemporary turbulence could just be an augury of the last days of a wobbly bubble.
4/4... James Joyce Table ....1st paragraph
CHAOS - THE VOLCANO SMOLDERS. Goldman Sachs pressured gold early today but as soon as they got word what was about to occur in the equity markets, both they and Morgan bank turned massive early buyers. By late morning gold was advancing in staunch fashion- $10 higher- when Goldman Sachs
turned massive seller and then stopped the gold price rally at -289.50 right below the magic 290 number ..........
Zenidea. Blood pressures, pulse rates and gastic noise
followed by pupil dilation, sweating hands, leg shaking and smiles increased today whilst pacing the floor and intence coin tossing transpired on the planet. :).
Good point(s). I have ridden up BearX a little bit and think I might sell now. Much as I love Tice's commentary and believe he is right on, I don't think he can win but for a very unusual and sudden event that will completely spook everyone and I do mean everyone.
TG seems to think they'll crash. James Turk thinks they might inflate to infinity and beyond :). Damned if I know. When has it ever been this complicated to concoct a reasonable investment strategy?
For several years, we have heard how crashing stock markets would devastate gold equities.
That is simply not true, as I have stated time and time again over the past few years.
Gold equities already had their crash some time ago, and most trade at sub-basement levels.
When the NASDAQ, DOW, BONDS, and US DOLLAR are falling simultaneously, there will be a flight to both physical gold and gold equities. Where else will money go? Obviously for some equities such as Barrick or Anglogold (the heavy hedgers), there might be much weakness at a point where gold breaks above 450. But for the rest of the gold equities group, there should be amazing price increases.
With the DOW and NASDAQ falling hard today, gold equities were one of only TWO strong sectors. The gold equities probably would have been much stronger today if gold investors had a stronger belief in the sustainability of today's stock market market weakness. However, most goldbugs have learned to expect Clinton government interference to sustain the market bubble and of course as usual it happened again. Once the Clinton government can no longer sustain its many years of interventions, then gold and gold equities will roar through the roof.
Finally, nobody should be surprised why stock market bulls constantly appear on these gold forums to warn of gold's demise if the stock market crashes. Naturally, they want gold investors to believe that a strong stock market is in their best interests.
Of course, it is not, and the proof exists in gold's dismal performance during the strongest stock markets in US history.
Gold will only shine once the general public recognizes the absurd overvaluations in general equities, bonds, and the US Dollar itself.
Can the PPT print money endlessly? If the PPT=ESF then they would already have billions to buy futures with. However, if the ESF is also supporting the dollar-SDR rate at the same time, then the dollars that pour into the futures market will do double damage if the sellers who are cashing out are overseas and dump the dollars on the FOREX markets.
Seems hard to imagine that 40 billion would last long if all these assumptions are true. They would have to bleed dry sometime. If the markets are too big to fail, the dollar is toast.
If Joe Nasduck gets a margin call, and the only way he can raise cash is by selling his gold miner shares or physical, then gold equities can be sold off. SO, how many high-tech Joe Nasducks have gold miner shares ?
"...are the markets too big to fail? Today's activity certainly provides support for such a claim. If so, then why not jump on the band wagon? Hedging the bet with ownership of physical gold of course. Or is there a limit to this kind of manipulation?"
Granted, the media can spin a news story to leave nearly any desired impression, but the CNN interviews with the average man on the street revealed him to be unflappable and citing this as a perfect buying opportunity. Many were said to be throwing money at their stock brokers to get in where they had missed out before. Assuming this mad money fuelled the late day recovery, what money will be left in hands interested in buying stocks come tomorrow?? Or if the rest used today's "recovery" as their signal for the 'All Clear' such that they will enter the market tomorrow, who with money will be interested in getting into a higher market two days from now?
The effect to this point reminds me of the game of Hot Potato, but with the dollar instead. Nobody wants to hold them very long for their own sake. When they are passed back and forth through stock purchases among Wall Street investors, stock prices climb as a result with little in the way of valid justification. And as long as most people refrain from "real economy" purchases, prices for real things remain reasonable (assited of course by the recent economic crises overseas that have provided us with cheap imports). This seems to be changing. If people come to see that stocks are not a sure-fire guarantee to increase their currency accounts, the first flight will be to cash. And when they realize that cash itself is a depreciating commodity against real goods (the things that increase or sustain our quality of life) the next flight soon thereafter will be into the real economy of limited real goods. Then we will see a price (hyper?)-inflation to match the existing currency supply inflation that has been built over the years.
Is the market too big to fail? I can certainly see why the government might be inspired to use every trick of the trade to sustain this diversion away from a flight to real goods. Can it last? Can we really be convinced that we are seeing a "new economy" that doesn't follow the rules of the past? Maybe...but that would require the suspension of human nature: Greed and Fear. I doubt that attainment of vast paper wealth on the markets would be content to stay there while living a modest lifestyle. People would be inclined to sell for cash in order to buy things for a more luxurious lifestyle. This trickle of greed (to get real things while the getting is good) will turn into a flood of fear and selling as people see the stock prices falling in relation to the rising prices of life's necessities and luxuries.
"Too big to fail?" Certainly, it is too big to fail without serious consequences. But when it comes to the ability of any government will to sustain it, here in The Tower we feel this phrase is more accurate: Too big to save.
It just can't be done...not without a hyperinflation to maintain the stock prices. But in such an event, the relative value of these same companies compared against real goods (especially gold) will decline miserably, though they would still be better than holding common currency in that event.
First, the logic that impels someone to invest in gold is entirely foreign to the logic that inspires NASDAQ investments.
A person must be categorically schizophrenic in order to hold both investments simultaneously since one is very much a bet against the other today. For one to rise, the other must fail.
I know a lot of NASDAQ investors at this point in my life and not a single one of them owns a single gold stock nor a single ounce of gold. So by empirical evidence and extrapoloation, that suggests that most NASDAQ investors do not buy gold...yet.
Moreover, the common scenario posited by stock market bulls is that if there is a crash, then investors will liquidate gold or gold stocks to raise money for margin calls.
However, if gold and gold stocks are soaring, while NASDAQ stocks are tanking, then why would the relatively few individuals (percentage wise) who own both want to part with his/her gold stocks. Logically, those would be the last holdings to be sold, as they would represent real security in such a panicky environment.
No, I have said this in the past and I'll say it again: you cannot compare today's devastated gold market with either 1929 or 1987 in which a large segment of the investor population owned both gold and gold stocks and were in a position to dump gold bullion plus relatively healthy gold companies's stocks in order to raise liquidity.
Today the average bullish investor is NOT in gold/gold stocks and so the average investor has NO gold or gold stocks to dump.
However, there are a fair number of wealthy individuals who are cash rich and on the sidelines. If they witness a market meltdown occurring alongside stable or rapidly rising gold/gold equities (as we saw today), then they most likely will direct funds to the gold sector before any other industrial sector.
http://www.bearforum.com/cgi-bin/bbs.plLots of bears talk about their trades today, poor executions, lagging reporting, bad spreads. Moral: You can be right on your bets at the casino, but they'll do everything possible to avoid paying off your winning bet!
Once again, I've borrowed Steven Solomon's "The Confidence Game: How unelected central bankers are governing the changed world economy" (1995, Simon & Schuster, 600pp). I'll soon be seeing just how much I've learned in the past year since first reading it, after hanging around here since August.
I still know of NO other book about the Central Banks that might give some insights into FOA's timelines on Euro replacing $, and gold's role in future of major currencies. I reviewed Mundell's website over the weekend and of course he does not tip his hand as to what Euro's creators think about such prospects. Surely, someone somewhere in the whole world(-wide web) has speculated on this? Anyone?
JCTex, thank you for your very kind affirmation and endorsement in your recent post:
------------------------------------
JCTex (04/03/00; 20:08:13MDT - Msg ID:28003)
TownCrier: re.: msg. #27983
Your description:
"You see, many mutual funds are compelled by their charter to keep a certain percentage of their funds in stocks. They simply can not flee to the sidelines or jump ship, but instead must run from one side of the listing ship to the other, back and forth, bailing water but sinking nonetheless in the end."
This may be the most descriptive and accurate explanation of the so-called equity markets that I have seen or expect to see. This one is worthy of notation by the historians in the years to come.
Perhaps that small piece of thought may help Sir Hudson with his question from earlier today: "I have been reading and learning from this forum for two months now, and would like to know how this crash and the jump in gold affects mutual funds ie: precious metals funds."
The effect of market movements upon these funds would depend on the particular fund's investment strategy charter, and ultimately upon the performance of the collective assets under management by that fund. And here is a telling example to cover additional bases: if the fund consistently buys an asset at the peak and sells at the trough even in a generally rising trend of that asset, the fund could actually be losing money. You can see, the performance also depends on the wisdom with which the fund manager makes his decisions. So, its hard to say for certain what outcome to expect, but generally, rising gold would help precious metals oriented mutual funds to rise also.
Dear Farfel: I laughed when I saw your latest message. Joe Nasduck, the eternal optimist, "is" my own husband! When Joe (not his real name) came home today, I asked if he had heard about the almost-crash. He said he'd heard something about it in the office, but that later the radio newscaster said investors had bought back on the dips. Joe expressed regret that I'd tied up money in gold, because stocks were selling at bargain prices.
My husband's a smart, well-educated guy. But as you said, gambling on the Nasdaq and buying gold as protection against a crash are like oil and water. At our house we have "his" stocks and "her" gold, and we try to steer our conversations away from financial matters!
I wonder if foreign investors holding US equities that got hit with an extra 2% losses due to the dollar fall will be as sanguine about holding on to the shares, or whether they'll take their toys and go home.
Where is the guy who could write like this? Do you still frequent these pages, Aragorn? Do you have any other names, that we might know you?
Aragorn III (2/16/99; 16:20:44MDT - Msg ID:2462)
Goldfly, my strong-winged friend...
"Goldfly (2/15/99; 20:43:07MDT - Msg ID:2438)
Has anybody here seen my friend Aragorn......?
Hey!! What happened to A3? He predicted a rhino, then a contest,
then....... Nada!
Come on Aragorn, get your two grains worth in there! Tell us what the
April contract will be on Friday!"
-----------------------------------------
As enjoyable as visiting the FORUM would have been, this weekend, alas, I must be content with reveiwing the archives this afternoon. Commitment to a project left me precious little time for anything else...and as you know, a prediction may require much time and thought--else it remains a useless guess.
I predict that you will not be satisfied with my prediction. I further predict that at end-of-day Friday, the COMEX contract for delivery of gold in April will BE (as it ever has) the "betting slip" between counterparties that may or may not have any connection with the metal, but have nonetheless come together at COMEX to wager each on their side of the speculation. And as this speculation walks tall among those few hunching and scrambling quietly for the scraps upon the floor, there can be little doubt as to what activity influences the price. They might just as well be betting upon the weather. And if enough people told you it was dark and stormy, would you cancel the picnic when your own eyes reveal the sun to be shining brightly? Grab your basket and special person; all tables and swings in the park are yours as many people are indeed influenced by the "bad weather on paper".
I predict that on Friday gold will be as it ever has been. Gold. Shining brightly. Who will join with me in trusting their own eyes?
This opportunity is lost when the paper guidance becomes discredited from a growing general sense of departure from reality. The day will arrive when the sunny park is full of visitors, no matter what the "storm on paper" says about the weather. Aristotle had it right. Take this picnic and walk in the park on your own terms.
PH, lately we've missed several other heavy hitters. Where in the world is Stranger? Solomon Weaver hasn't checked in for several weeks. I miss Goldspoon's cheerful posts very much. I was even beginning to wonder where you were!
Good article! Nasdaq's volaitility not seen stifling Fed's inclination toward future rate hikes
http://biz.yahoo.com/rf/000404/9a.htmlWhile the Fed is said to welcome an orderly stock market pullback to assist their efforts at slowing consumer spending, they don't want a free-fall either. Analysts expect rate hikes to continue in May and June even in tandem with an orderly, declining market. An economist with Bear Stearns said, "The Fed wants 3.5 percent economic growth. I don't think anything that happened today gets them closer to that. I would certainly expect them to carry on (raising rates) at the May meeting and at the June meeting."
According to this Reuters article, the Fed is concerned that "the enormous paper wealth created in the past few years is boosting consumer spending to unsustainable levels." Economist David Resler said, "Greenspan and other Fed officials have warned for a long time that asset markets are overvalued and a sense of rationality needs to take hold."
The article offers good concluding remarks. If the Nasdaq bursts with a *POP!*, the Fed will likely be blamed by many for letting the speculation get out of hand. After saying that the three 1998 rate cuts were needed to keep the financial markets from locking up, it also set the stage for the Nasdaq rally that followed. However, Resler makes the keen observation, "The Fed's job is not to prevent stupidity from taking hold," saying that their mission is to keep inflation low, and so far they have done that.
---------------------
So far...but methinks the situation has become too difficult to manage for long. We shall see.
Farfel, I agree - gold stocks need not fall during a market crash, and everything I've seen the past few months shows me they are rallying during heavy market downturns. Remember one point, however, in order for gold stocks to rally ESPECIALLY the junior miners...the price of gold has to go up. In '98 gold stocks fell because Asian nations (such as Korea) were selling gold...this forced the price of gold down and gold stocks fell during the market's decent. One the POG rallied - so did the gold stocks.
The XAU follows the POG, not the other way around.
**From Ross L, "If the markets are too big to fail, the dollar is toast." Well said. Even if the ESF and PPT keep intervening, they must print more and more dollars for their gameplaying. How long will the rest of the world keep accepting them? What if they return but not as equity investment money but as payment for real goods.
** Another thought, Now we know about how bad it has to get for the "flight to safety" to look to precious metals. Uncertainty and volatility seem to be good friends of gold and silver.
** Question for ORO, Why did the PPT wait so long to intervene and do you feel they are secure, operating within their means, sure of themselves. How risk free is their operation. I don't believe it can go on forever but how "tricky" is the manipulation- is it just some phone calls or is it a mission impossible type (delicate) operation? Hard to phrase exactly. Thanks.
Recently it was spring vacation and had the chance to read The Velocity of Money by Stephen Rhodes. A very interesting & exciting book. Thank you to all on the forum,with the past years of financial education received here, the book had a great deal of meaning in context to the discussions here.
Here's some relevant info to support your contention that things, in the case of this example the world's ninth largest economy, are indeed often "Too big to save" as per:
"'Too big to fail?' Certainly, it is too big to fail
without serious consequences. But when it comes to the
ability of any government will to sustain it, here in
The Tower we feel this phrase is more accurate: Too
big to save." -TownCrier (04/04/00; 18:39:01MDT - Msg ID:28071)
Sir Harley Davidson and Cavan Man
- Although US, IMF, etc. have indicated support for Brazil, it's the world's ninth largest economy and will have to sink or swim on its own. Brazil's future largely depends on greatly reducing the budget deficit. -CNBC, 18
Sep 1998, ~4:05:01 PM EDT
- ~"While they haven't approved any loan, suppose in the next week or so, the IMF gave Brazil a $30 billion bail-out loan. Would that be sufficient? How would the markets react?"-Ron Insanna ~"Well, considering IMF gave $22 billion for Russia, a small economy, $30 billion is considered insufficient for Brazil, the world's ninth largest economy." -Sonia Dawson, -CNBC, 5 Oct 1998, ~3:40:50 PM EDT
- The question is will this spread to the rest of Latin America, which amounts to 20% of trade with America. Will the Mexican peso be hit when the markets open today? Russia didn't spread, but it is a relatively small economy and is effectively insulated from the rest of the world. Is this another black eye for the IMF. Yes, probably, because $2 billion has left Brazil since the beginning of January despite IMF loan guarantees of over $41 billion. Brazil simply can't afford this. Some people see the U.S. economy as strong, but this can't go on forever, and a decline in Latin American trade won't help. Some [Japan for example] see the latest U.S. stockmarket runup as a bubble. -Nick Hastings, Sr. Foreign Exchange Correspondent, Dow Jones News Wire, CNBC, 13 Jan 1999, ~8:34:22 AM EST
PPT: Plunge Protection Team [unofficial-official government manipulation group. Purpose is to prevent the market from crashing and hurting "Wimpy" & Tipper's chances of being elected].
Plunge Protection Team
By Brett D. Fromson
Washington Post Staff Writer
Sunday, February 23, 1997; Page H01
It is 2 o'clock on a hypothetical Monday afternoon, and the Dow Jones industrial average has plummeted 664 points, on top of a 847-point slide the previous week.
The chairman of the New York Stock Exchange has called the White House chief of staff and asked permission to close the world's most important stock market. By law, only the president can authorize a shutdown of U.S. financial markets.
In the Oval Office, the president confers with the members of his Working Group on Financial Markets -- the secretary of the treasury and the chairmen of the Federal Reserve Board, the Securities and Exchange Commission and the Commodity Futures Trading Commission.
The officials conclude that a presidential order to close the NYSE would only add to the market's panic, so they decide to ride out the storm. The Working Group struggles to keep financial markets open so that trading can continue. By the closing bell, a modest rally is underway.
This is one of the nightmare scenarios that Washington's top financial policymakers have reviewed since Oct. 19, 1987, when the Dow Jones industrial average dropped 508 points, or 22.6 percent, in the biggest one-day loss in history. Like defense planners in the Cold War period, central bankers and financial regulators have been thinking carefully about how they would respond to the unthinkable.
An outline of the government's plans emerges in interviews with more than a dozen current and former officials who have participated in meetings of the Working Group. The group, established after the 1987 stock drop, is the government's high-level forum for discussion of financial policy.
Just last Tuesday afternoon, for example, Working Group officials gathered in a conference room at the Treasury Building. They discussed, among other topics, the risks of a stock market decline in the wake of the Dow's sudden surge past 7000, according to sources familiar with the meeting. The officials pondered whether prices in the stock market reflect a greater appetite for risk-taking by investors. Some expressed concern that the higher the stock market goes, the closer it could be to a correction, according to the sources.
These quiet meetings of the Working Group are the financial world's equivalent of the war room. The officials gather regularly to discuss options and review crisis scenarios because they know that the government's reaction to a crumbling stock market would have a critical impact on investor confidence around the world.
"The government has a real role to play to make a 1987-style sudden market break less likely. That is an issue we all spent a lot of time thinking about and planning for," said a former government official who attended Working Group meetings. "You go through lots of fire drills and scenarios. You make sure you have thought ahead of time of what kind of information you will need and what you have the legal authority to do."
In the event of a financial crisis, each federal agency with a seat at the table of the Working Group has a confidential plan. At the SEC, for example, the plan is called the "red book" because of the color of its cover. It is officially known as the Executive Directory for Market Contingencies. The major U.S. stock markets have copies of the commission's plan as well as the CFTC's.
Going to Plan A
The red book is intended to make sure that no matter what the time of day, SEC officials can reach their opposite numbers at other agencies of the U.S. government, with foreign governments, at the various stock, bond and commodity futures and options exchanges, as well as executives of the many payment and settlement systems underlying the financial markets.
"We all have everybody's home and weekend numbers," said a former Working Group staff member.
The Working Group's main goal, officials say, would be to keep the markets operating in the event of a sudden, stomach-churning plunge in stock prices -- and to prevent a panicky run on banks, brokerage firms and mutual funds. Officials worry that if investors all tried to head for the exit at the same time, there wouldn't be enough room -- or in financial terms, liquidity -- for them all to get through. In that event, the smoothly running global financial machine would begin to lock up.
This sort of liquidity crisis could imperil even healthy financial institutions that are temporarily short of cash or tradable assets such as U.S. Treasury securities. And worries about the financial strength of a major trader could cascade and cause other players to stop making payments to one another, in which case the system would seize up like an engine without oil. Even a temporary loss of liquidity would intensify financial pressure on already stressed institutions. In the 1987 crash, government officials worked feverishly -- and, ultimately, successfully -- to avoid precisely that bleak scenario.
Officials say they are confident that the conditions that led to the slide a decade ago are not present today. They cite low interest rates and a healthy economy as key differences between now and 1987. Officials also point to SEC-approved "circuit breakers" that were introduced after 1987 to give investors timeouts to calm down.
Under the SEC's rules, a drop of 350 points in the Dow would bring a 30-minute halt in NYSE trading. If the Dow declined another 200 points, trading would cease for one hour. No additional circuit breakers would operate that day, but a new set would apply the next trading day.
Despite these precautions, today's high stock market worries officials such as Fed Chairman Alan Greenspan, who in a speech in early December raised questions about "irrational exuberance" in the markets. Because the market declined following Greenspan's speech, government officials have become even more reluctant to comment on these issues for fear of triggering the very event they wish to forestall, according to policymakers.
A Brewing Concern
Greenspan had expressed similar thoughts a year ago at a confidential meeting of the Working Group. Treasury Secretary Robert E. Rubin and SEC Chairman Arthur Levitt Jr. also are concerned about the stock market's vulnerability, according to sources familiar with their views.
The four principals of the group -- Rubin, Greenspan, Levitt and CFTC Chairwoman Brooksley Born -- meet every few months, and senior staff get together more often to work on specific agenda items.
In addition to the permanent members, the head of the President's National Economic Council, the chairman of his Council of Economic Advisers, the comptroller of the currency and the president of the New York Federal Reserve Bank frequently attend Working Group sessions.
The Working Group has studied a variety of possible threats to the financial system that could ensue if stock prices go into free fall. They include: a panicky flight by mutual fund shareholders; chaos in the global payment, settlement and clearance systems; and a breakdown in international coordination among central banks, finance ministries and securities regulators, the sources said.
As chairman of the Working Group, Rubin would have overall responsibility for the U.S. response, but Greenspan probably would be the government's most important player.
"In a crisis, a lot of deference is paid to the Fed," a former member of the Working Group said. "They are the only ones with any money."
"The first and most important question for the central bank is always, `Do you have credit problems?' " said E. Gerald Corrigan, former president of the New York Federal Reserve Bank and now an executive at Goldman Sachs & Co. "The minute some bank or investment firm says, `Hey, maybe I'm not going to get paid -- maybe I ought to wait before I transfer these securities or make that payment,' then things get tricky. The central bank has to sense that before it happens and take steps to prevent it."
1987: A Case Study
The Fed's reaction to the 1987 market slide, which Corrigan helped oversee, is a case study in how to do it right. The Fed kept the markets going by flooding the banking system with reserves and stating publicly that it was ready to extend loans to important financial institutions, if needed.
The Fed's actions in October 1987 read like a financial war story.
The morning after the 508-point drop on Black Monday, the market began another sickening slide. Corrigan and other Fed officials strongly discouraged New York Stock Exchange Chairman John Phelan from requesting government permission to close the market. Phelan was concerned that if the market continued to erode, the capital of the NYSE member firms would disappear. Corrigan feared a shutdown would cause more panic.
"It was extraordinarily difficult around 11 o'clock," Corrigan recalled. "The market was at one point down another 250 points, and that's when the debate with Phelan took place."
Simultaneously, Corrigan and other central bank officials spoke privately with the big banks and urged them not to call loans they had made to Wall Street houses, which were collateralized by securities that could no longer be traded and whose value was in question.
A final critical moment came that day when the Fed decided not to shut down a subsidiary of the Continental Illinois Bank that was the largest lender to the commodity futures and options trading houses in Chicago. The subsidiary had run out of capital to provide financing to that market.
"Closing it would have drained all the liquidity out of the futures and options markets," said one former top Fed official involved in the decision. Investors use stock futures and options to hedge positions in the underlying stock market.
Recognizing the crucial role of banks if another financial crisis should strike, the Office of the Comptroller recently conducted an internal study of what damage a market decline would inflict on U.S. banks. The OCC declined to discuss the study or its conclusions.
At the SEC, one big worry is how to cope with an international financial crisis that begins abroad but quickly rolls into U.S. markets.
"We worry about a U.S. brokerage firm that is dealing with a Japanese insurance company, where we don't know how they are run or regulated," a SEC source said. To improve its ability to react in a crisis, the SEC and the Fed have begun joint inspections with their British counterparts of U.S. and British financial institutions with global reach.
The most drastic -- and probably unlikely -- move the SEC could take in a crisis would be to propose a market shutdown to the president. That would require a majority vote of the commission. If a quorum couldn't be mustered, the chairman could designate himself "duty officer" and go to the president or his staff.
"Closing the market is, of course, the last thing the commission wants to do," said a source familiar with the SEC's planning. "During a time when people are extremely worried about their investments, you are cutting them off from taking any action. . . . The philosophy of the commission is that markets should stay open."
Just the Facts
Gathering accurate information would be the first order of business for federal regulators.
"Intelligence gathering is critical," Corrigan said. "It depends on the willingness of major market participants to volunteer problems when they see them and to respond honestly to central bank questions."
The SEC, CFTC and Treasury have market surveillance units. They monitor not only the overall markets, but also the cash positions of all the major stock and commodity brokerages and large traders.
The regulators also are hooked into the "hoot-and-holler" system used to notify participants in all financial markets of trading halts. The hoot-and-holler system alerts traders and regulators when a halt is coming.
Relying on Quick Action
In the event of a sharp market decline, the SEC and CFTC would be in constant contact with brokerage and commodity firms to spot early signs of financial failure. If they concluded that a firm was going down, they would try to move customer positions from that firm to solvent institutions.
At least this team of crisis managers already has been through the Wall Street wars. Greenspan was Fed chairman in October 1987. Rubin has served as the co-head of investment bank Goldman Sachs & Co. Levitt has been both a Wall Street executive and president of the American Stock Exchange.
"I think the government is in good shape to handle a crisis," said Scott Pardee, senior adviser to Yamaichi International (America) Inc., a Japanese brokerage subsidiary, and former senior vice president at the New York Fed. "A lot depends on personal relationships. You have a number of seasoned people who have gone through a number of crises. So if something happens, things can be handled quickly on the phone without having to introduce people to each other."
Consider what happened at 11:30 p.m. Dec. 5, when Greenspan made his comments about irrational exuberance. Alton Harvey, head of the SEC's Market Watch unit, was called at home by officials of Globex, a futures trading system owned by the Chicago Mercantile Exchange. U.S. stock futures trading in Asia had fallen to their 12-point limit, they said.
Harvey immediately alerted his direct superior as well as his opposite number at the CFTC. More senior SEC and CFTC officials were informed as well. But there wasn't much to be done until the morning. So Harvey went back to sleep.
REACTING TO A PLUNGE
After the market crashed on Oct. 29, 1929:
* The Federal Reserve provided loans and credit to financial systems.
* President Hoover met with business, labor and farm organizations to encourage capital spending and discourage layoffs; he also promised higher tariffs.
* Federal income taxes were reduced by 1 percent by the end of the year.
After the market dropped 22.6 percent on Oct. 19, 1987, the Federal Reserve:
* Encouraged the New York Stock Exchange to stay open.
* Encouraged big commercial banks not to pull loans to major Wall Street houses.
* Kept open a subsidiary of Continental Illinois Bank that was the largest lender to the commodity trading houses in Chicago.
* Flooded the banking system with money to meet financial obligations.
* Announced it was ready to extend loans to important financial institutions.
What would happen today during a stock drop would depend on the particulars. Here are current guidelines:
* If the Dow Jones industrial average falls 350 points within a trading day, NYSE trading would be halted for 30 minutes.
* If the DJIA falls another 200 points that day, trading would stop for one hour.
* If the market declines more than 550 points in a day, no further restrictions would be applied.
Absurd valuations in US indices may indeed be one of MK's fabeled "Horseman". However, the main event, the case for gold ownership, is best made with a monetary argument.
Whether the market sails onward and upward or crashes and burns, my personal decision to own gold will not be influenced by the outcome in equities. There exists a large world beyond our shores. This world is awash in dollar float. Understand the ramifications of dollar genesis and your decision to own gold will be made easy.
The Euro had to be created out of necessity. Why else (really) would distinctly sovereign nations with historically poor relationships punctuated by many instances of murder and mayhem form such a union? The European continent is a "balkans" of sorts. Have any of the Euro zone countries had a social, economic and political relationship such as exists between the US and Canada for example? I think not. Most recently, there's only been continental peace in Europe for just 55 years running.
As a true, patriotic American although not a veteran, I hope the USD can be saved. I regret to say that my study of the matter and my intuition tells me not.
Just haven't had as much evening time and Earl Grey tea to wax philosophical with.
Been keeping a 1998 silver eagle in my pocket lately as a good luck charm...that is the year that Warren Buffet cornered the market on silver and nobody noticed!!!!
"Can you produce either from savings or from your own mind or your own two hands something that the rest of the world demands? If so you will likely be able to meet your needs."
TC,
An "average, boring, mid-western guy" like me is really humbled by the wisdom in this thoguht of yours--so very profound. Although I am already alert, it is also a wake up call! I will be putting this one in my personal HOF for quotations if you don't mind. Thank you.
There was alot of talk on the air waves today about NASDAQ stocks being overvalued. To put it in the modern vernacular I would have to say... DUH! I know it is difficult for those who sit round this table to understand this craziness. I too have struggled with the hows and whys of this most extraordinary phenomenon we call the stock market. I can explain it in only one way. We live in the age of sheep. The age of the wimp. Most peoples minds have been slowly assimilated into the nothingness of the collective unconcious. We all stand idly by while the Felon in Chief rapes, bombs, steals, lies and murders with reckless abandon. We follow the same inane dramas involving little Alien (sp) Gonzales, Jon Benet Ramsey, and dumb@$$ actors and sports figures who have made millions of dollars while distroying their own lives. On balance, Americans are just plain "over pleasured." The sheep grow fat on summer pastures. Go out tomorrow and look around. Listen to the idle chatter on the bus or in the resturant. Everybody's a freaking genius nowadays. I feel like I'm in a bad remake of the Twilight Zone. I can see the danger comming, but can only mouth the words. No one is looking. They're all smug and happy. They're shopping. They're buying stocks. They're all getting rich! Wheeee! But they're forgetting one thing.
He who follows the flock, eventually steps in S#!%.
Just Dropped In To See What Condition My Condition Was In
Thanks for the plug, Leigh. (If you only knew HOW heavy...)
Please forgive me, all, if what I am about to say has already been presented.
February's PCE Deflator was reported at .4% on Friday. This annualizes at 5%, a long way from the nearly universal expectation of continued disinflation which prevailed on Wall Street just one year ago. (The PCE Deflator is the price gauge most concerning the Fed because of its relative freedom from political influence).
Then, yesterday, the National Association of Purchasing Managers reported their monthly prices-paid index at 79.8, up from 74.1 last month. This is the highest reading since February 1995. The report said, "manufacturers continue to pay higher prices as the Index has been above 50 percent for 11 consecutive months, with the last seven months above 60 percent. In March, 58 percent of purchasing executives reported paying higher prices and 4 percent reported paying lower prices."
Here is the list of materials which were in short supply and/or up in price:
In Short Supply
Capacitors; Electronics; Laptop Computers; Memory; and Styrene.
This is from today's Wall Street Journal coverage of the story:
"April 4, 2000
[Purchasing managers' business-survey Chairman Mr. Norbert]Ore [said] that higher materials costs and greater demand are both
adding to price pressures, and while the recent slide in oil prices might
alleviate some of the pressure, "the demand-pull side is probably still going
to be there."
The higher prices, combined with the Commerce Department's report
showing that construction spending hasn't faltered in the face of higher
interest rates, may add to fears of looming inflationary pressures among
Federal Reserve policy makers. The Fed has tried to forestall inflation with
a series of interest-rate increases.
Some Forecast Half-Point Rise
The central bank bumped up rates by a quarter of a percentage point in
March and is expected to do so again at its next meeting in May. Some
economists believe that with the economy showing so little response to rate
increases so far, the Fed might raise rates by a half a percentage point next
month."
Stranger's Comment: We have been saying here for many months that prices were headed higher and that Greenspan's quarter-point rate increases would make no difference. For a real eye-opener on just how mistake-prone the Greenspan Fed has been in recent years, check out the cover story by Gene Epstein in this week's "Barron's" entitled "Fortunate Son. Until Now, Greenspan Has Been More Lucky Than Right".
One last item. This morning, Phil Roth, chief technical strategist at Morgan Stanley reminded all who will listen that the government bond market is being influenced by such issues as flight-to-safety and government debt retirement which are all-together different from inflation expectations. Other debt markets such as corporates, munis, and foreign bonds are not yet reflecting the recent rally in govies. In other words, govies are the anomaly here.
Have you ever seen the movie, "CABARET"? (Or for that matter, the stage play?)
If you have, enough said. Else it's set before and during the rise of the Fascist Brownshirts in pre-Nazi Germany. There are signs things are not right, but anytime anyone notices, the refrain is "No need to follow these prophets of doom, come to the cabaret." The "cabaret" is a nightclub, a party place.
CABARET's a musical! It's reminded me of modern America for about the last five years. Hope the analogy breaks down before the curtain falls.
Stocks Falling, Bonds Falling, US Dollar Falling = GOLD RUSH
Lamprey, yes, I am well aware of what happened during the Asian crisis. Those collapsing markets forced Koreans, etc. to sell gold to raise liquidity.
The desire to sell gold rested on the perception of American market and currency power. Ultimately, we saw huge Asian capital flight head for the US Dollar via purchases of American bonds and stocks. America was perceived as a safe haven from all the Asian currency and market turmoil.
Various Asian central banks were happy to sell gold in order to raise US Dollars, owing solely to the perception of America as a stable market overseen by a stable government.
However, if the foreigners begin to view American markets as unstable or the US government as unstable, then we are in a different ballgame. Already there is bound to be a perception by certain foreigners of a diminution of American good faith (since Americans retained a perjuring President in power).
Today, the most notable change from 97 is this: the US financial markets are in full bubble mode and US money supply has simply gone through the roof (The recent little 15% drop in NASDAQ and nominal drop in the DOW have changed nothing in those respects).
In fact, various governments (especially Germany) have taken to lecturing Americans lately about the perceived potential instability in American markets and the risk posed to their investments in this country.
What does that mean?
It means that if American markets go into turmoil, this country cannot count on foreign funds inflows to save them this time. America cannot count on foreigners chasing American dollars, since foreigners are awash in them now via excessive US money supply, far outstripping real American GNP.
This time, a US market crisis triggering a US dollar crisis would lead foreign governments to race for something other than US Dollars.
And if a US Dollar crisis triggers global currency unrest as foreign governments are deluged by even more US paper "cashing out" of US markets, then foreign governments faced with whipsawing currencies (owing to an unstable US Dollar) will be compelled to seek a medium of exchange with immutable intrinsic value, an asset vs. a debt.
Essentially, reduced to the most elementary concept, in a world awash in trillions of dollars of forever escalating debt, the monetary reserve that will have the most value will end up being the one in most scarcity, most importantly the one that is an asset and nobody else's debt.
That is why a simultaneous American currency and market crisis signals the beginning of the most astounding gold bull in history.
Are we there yet? Who knows, it's impossible to say? Yet with more days like today then the stability of American markets comes into question. That is not good for the US DOllar since linchpin of its value from foreigners' perspectives is its purported stability.
One more day like this one over the next little while and foreigners will begin to cast their votes.
Lamprey, in that desperate environment, I do not see Central Bank sales of gold, rather instead I see Central Banks desperately calling in their gold loans and Central Bank screams for gold to replace the newly unstable US Dollar reserves.
We are not back in 1997 anymore, we are not back in Kansas now, Lamprey.
Kuwait--Apr 4--Kuwait has joined fellow OPEC member Saudi Arabia in switching at the start of this month to pricing based on the IPE Brent weighted average (BWAVE) for crude sales to its European customers, a Kuwait Petroleum Corp. source said. The source also said Kuwait Petroleum informed its clients that it was "ready to meet their needs" in line with its 144,000-barrel-per-day output rise under the new OPEC-9 production ceiling. By Inal Ersan, Story .16830
<;-)
HONG KONG, April 5 (Reuters) - Hong Kong's blue chip Hang Seng Index (^HSI - news) fell over three percent just after the open on Wednesday, with technology shares hammered down hard after a sharp sell-off in tech stocks on Wall Street overnight.
The benchmark Hang Seng Index slumped 3.07 percent or 518 points to 16,374.74. It was the first trading day in Hong Kong since U.S. software giant Microsoft Corp (NasdaqNM:MSFT - news) rattled U.S. markets on news that talks to settle its landmark antitrust case had failed.
Hong Kong's new high-tech GEM index (^HGEI - news) plummeted 10.56 percent to 690.00 shortly after the open. Financial markets were closed on Tuesday for a public holiday.
=====
<;-)
Yesterday the pundits were blaming the near crash in the equities markets on comment by Abby joseph and Mark Mobius. These markets were looking for an excuse to take profits off the table. Last week James Cramer (of thestreet.com) suggested that investors do the same. However, last week there were reports that Mark Mobius was in S. Africa, and had made the recommendation to SA leaders that they should consider linking the Rand to Gold. He had also predicted that Tech stocks would crash (cause and effect?). The recommendation would make sense for SA, and would provide an alternative currency linked to gold, especially since the Swiss have abandoned the Francs link to gold. If SA were able to do this, reform their banking industry, and get crime under control, then perhaps SA would rise to be a safe haven as Switzerland once was. This would attract substantial investment perhaps. Just a late night thought anyway.
The details have been put forward before in earlier posts. Goldiehawk's WP article post is the best piece put to the public.
The bulk of the action is by the bankers themselves doing Nick Leeson like market moving actions. When the market moves against them they just out and buy futures and options and borrow the credit from each other in order to post margin when the action was not sufficiently effective. If action was effective, they will not need to post margin and have "theoretically" moved the market at no cost (to themselves).
The main trouble is having to borrow in order to post margin. That is a problem because the loan (the asset) creates a liability (a large one - the checking account money) that may not be balanced by transfers of liabilities of other banks. If there is an imbalance, the lending bank needs to cover by selling assets. If a bank needs to sell assets - then it is in trouble - just like anyone else facing a margin call. At this point, they call on the ESF and the Fed.
The ESF intervenes directly only when there is need to post margin beyond the ability of the bankers to shell out, or the collective bank stomach for risk taking for the manipulation is lacking - meaning that they are faced with selling of treasuries and mortgages in order to settle funds if they need to post margin. The ESF can act as the equivalent of $500 billion when converted into arbitraged stock positions.
The Fed's buying for the BOJ was the equivalent of a coupon pass that allowed banks to sell treasuries without hammering the price. The sales allowed them to continue buying after the initial buying at 11:40-12:00, 12:35-12:50 were too heavilly sold into and some panicked and sold back in the 12:50-13:00 period.
Even when the cap was put on the gold markets at the 13:00 coordinated intervention, panic selling from participants in previous support action (which failed) continued and if there was direct intervention by the ESF it was then. By 13:20 the selling was overcome and the intervention was in full force, turning into a stampede of the shorts. The money flow seems to indicate a net sell in the period immediately after intervention, and a net 0 buying from 14:00 till just before close.
I was just showing my 4-year-old daughter my photo collection from a month's visit to Africa in 1978. Lots of children in out of the way villages, smiling and posing for my camera, wanting to play with me and my fellow (often stranded) travelers.
My thoughts today: The world's most gentle people. The world's most patient people. To have endured so much. WRITTEN OFF BY THE REST OF HUMANITY. True, no?
For contrarians like us, wouldn't you want to bet that these are the people most overdue for something good to happen to them? (At this point, what have they got to lose trying Mobius' suggestion?)
To have produced a Mandela and de Klerk together in a land of gold... I wouldn't put it past them to show the world a thing or three about real money.
Raised $39 M, Had $11 M
Owes $12 M
54 million shares in Lihir $23 million.
Had $100 M of exploration properties (book value), which they had just written off
Had 140 M Shares out
When I bought them at 1/8 to 1/4 they were selling at 1/2 of the value of their Lihir shares and 1/4 of the value of their share of PP deposits at Lihir based on the $300 gold minimum that I expected to see for average selling price in Q3 1999 to Q2 2000. Had their mining properties had any findings they would have provided an additional boost.
It was like buying perpetual Lihir call options
When they declared the itemus conversion they had taken in Tobin and were collecting a B class staff of internet startup specialists with good connections. Since these types of companies were trading at some 20 times book, I found that holding the stock, by then up 2 fold, to be a good idea. Had they remained a gold company at the expected gold price range they would still be worth $0.7-0.9 by my take, and as an internet investment fund they would be worth 5-10 times book, or better. So their full potential at their former book value was between 5 * $30 / 140 to 10 * $30 /140 - or $1 to $2 - say $1.50 if they did not raise fresh funds. With fresh funds - as announced in Feb - they were worth about double that, say $3 +/- $1 so long as internet incubators were selling at the 10-20 times book range.
Vengold purchases - in 2 months:
ideaPARK,
Intrasoft Technologies,
Teamcast.com Corp,
Exceleration.net
I am clueless about these, and have only a nominal position left in the stock - so I will track these developments lightly and through the technical behavior of the stock.
Because of the level of volatility, I do not buy net junk above 1/2 of my minimum expected target, and don't go in unless there is potential for a quadruple - That means that I have not held any internets since the beginning of 1999 and stopped looking for ops in that arena in July 1999. Missed out on alot, but did ok with gold stocks.
Finally, I reccomend that no one do what I do, and not try to shadow these moves - and I don't consider Vengold ne itemus a good investment at these levels. I just put this up to show a way of thinking - since we have talked of this company often.
--------------------
Sold 1/2 my short fund, intend to expand position if NDX does well and then slows, sell the rest (for now) at a close of about 3500-3600 on the Nasdaq.
Are you up shadowing the PPT tonight? Think they're in some NY or Washington hotel suite planning tomorrow's actions? That's what they did in 1987.
Are the banks that illiquid? Isn't enough of their capital available to stake their positions, so that borrowing short-term is not a factor? I would think so, anyway.
I read Mr. Moto on Prudentbear.com, and now on bearforum.com, with the money supply adds (like Townie does here), often seeming to show up in the day's stock actions. It's just hard to believe that everything is so often on such a tight edge for organizations that have profited so mightily throughout the 90s and must have some improved capital positions (at least on paper) compared, say, to 1990, or other crisis times.
Indeed, SA with so much potential. Hopefully they will take Mark Mobius's advice. Such a move would bring much desired stability and strengthen the gains made so far during this continuing transition from the aparteid era.
A Great Article on the Mentality of Yesterday's Investors
It was a day to lose fortunes --and a day to make
them.
Experienced day traders made tens -- even hundreds
-- of thousands of dollars in the stock market's wild
ride yesterday.
But novice day traders got hammered.
"For some, it was a day of huge opportunism. For
others it was their worst nightmare," said David
Nasser, chairman of Market Wise Securities, a
day-trading firm based in Denver.
"There was very little in between. You were either on
one end or the other."
Nasser, whose firm has seven offices and 1,000
traders nationwide, said one trader in the Denver office
made $150,000.
On the other hand, a less experienced trader lost
$80,000 -- and the company shut down his account.
"Lots of people got bruised up pretty badly," Nasser
said.
"People were sucked in Monday. They bought
Microsoft on its lows expecting it would go no further.
When it went down even more, they were burned up
pretty badly."
For one New York day trader who made tens of
thousands, "it was possibly the best day I've ever seen
-- and that's what every trader would say."
It was a good day also for David Floyd, a partner in
Careerdaytrader.com, a small San Diego day-trading
company.
"It was one of the most volatile days I've seen," he said.
"On the other hand, it produced some of the best
trading I've ever seen. It was one of the top five days
I've traded."
Floyd said he made a profit of $7,000 but only traded
half a day.
But three of the nine other traders in the office made
$24,000.
"That's exceptionally good," he said.
Investors who buy and sell stocks online were active,
too.
BuyandHold.com Securities, a discount brokerage for
novice investors, said 10 times as many investors
bought stocks as sold them yesterday.
Nasser said there was so much chaos in the market
that those who stayed on the sidelines were smart.
David Schwerdt, 37, a Los Angeles banker visiting the
Big Apple on business, was one of them. "I held on to
everything. You don't want to panic. There's so much
money in the market, it has to go up," he said.
John Carroll, a brokerage executive, was one of the
losers.
"In the long term, can you go home tonight and sleep
when your portfolio goes down $100,000 in a day, as
mine did? I can because I believe in the companies I
own," he said.
[Thanks to the NEW YORK POST, Fair Use for Educational/
Research Purposes Only]
http://www.cnnfn.com/markets/morning_call/Looks like a very nasty opening this morning as the Wall Street crash continues. S&P Futures are down -19.50, that's -8.38 below fair value. Overnight, Xetra-DAX is off -3.84%, and CAC-40 off -4.54%. Menwhile gold off -$0.90, Silver off -$0.02, Pt up +$3.00, and Pd off -$9.00. Looks like a continuation of yesterday. Only question to be answered - Will the indices recover as well as yesterday, or is this the day that Wall Street quakes and crumbles? I would not walk on the sidewalks along Wall Street today - Brokers don't bounce!
http://uk.news.yahoo.com/000405/5/a2wok.htmlLondon Market is down, but guess what? There was a "convenient systems failure". Uh-huh! One market-maker says it's "fortuitous" (wink wink). It looks uglier by the minute!
http://www.bearforum.com/cgi-bin/bbs.pl?read=15451John G at bearforum has posted this astute analysis of what happened yesterday in markets. What hits me is (1) the difficulty of hitting your trades in a volatile market, (2) TPTB throwing the public's unknowing money against you, and (3)the time and stress involved in trying to cash in on the inevitable bubble-popping.
And all this is without general market lockup/meltdown, where nobody's winning trades are safe in certainty of payment.
Although I've waited since 1987 for moments like this, it now seems out of reach, and FOA's counsel applies to all markets at this stage of the mania. Get physical!
"04/04/00
1. Let's talk about unnatural acts tonight.
2. The NDX was clearly in crash mode this morning after 10:10 Eastern. We had a picture perfect 5 wave elliot structure down to 3525 with the NDX down about 13% on the day. Volume had been running at an all time record pace all morning during the sell off. Near the bottom, the NDX contract was lock limit down, and as my intraday "extreme" indicators were flashing "buy" I saw the market start up. Frantically, I log on to Schwab to grab a batch of QQQ long (since the contracts are lock limit), but the system is so slow that 75 points go by just logging in. By the time I am logged and ready to place the order we are up over a hundred points. Now normally when the market craters 500 points in a morning you expect a rebound of 100 to 150 points, but you expect that there are reasons for the selling and that those reasons will not suddenly disappear. Thus, while you expect a rebound of 100 to 150 points, you do not expect a 500 point rebound. So I refuse to chase the QQQ. In the meantime, the NDX contract reopens and is suddenly 75 points above fair value, a whopping 120 points above the cash.
3. After the bounce, you naturally expect a retest of the lows. So whenever "THEY" bid the premium to more than 100 points above fair value, small traders take an extended lunch break. After all, if the advance merely slows, the premium will flip to negative and you have just lost 100 points - or $10,000 on the big contract, or $2000 on the mini. It is one hell of a poor bet. So like the other traders, I sit back and watch for an opportunity to sell that premium. But of course you are in the chamber of horrors. Anyone who bids the future up 100 points above fair value is not motivated by normal trading economics. It is nearly impossible to trade from that position and make money. Under ordinary circumstances the boys will fade the premium so that it falls to a discount before you reach the highs. Not this gorilla! Indeed, at the twin peaks, at 2:40 and 3:45 the premium was 100 points above fair value. This gorrilla wants to wear those contracts!
4. So what is this 800 pound gorrilla trying to accomplish? The short answer is that he is thumping his chest and announcing to the world that the market is going much higher. Whether you like it or not! Now why on earth would the future be used for such a garrish display of market power? Simple - it is a stalking horse for some other freight that is much larger and much more important. Could the Fed. be behind it? Absolutely not. The Fed is far to vulnerable politically to do this sort of thing. Could it be the the Treasury's exchange stabilization fund. Possibly! That fund, numbering in the tens of billions is at Summer's discretion, with no audits and no accountability to Congress. By law, nobody will know.
5. So as the 800 pound gorrilla's premium fades a touch, you begin squirm in your seat, wondering just who it is, and more important, just how crazed it is. You wonder whether he has the bucks and cahones to jam the cash as well and keep the premium up there for the next 100 cash points? The gorilla wants you to freeze in your tracks and you do. You can always trade tomorrow when the beast cools down and risk descends to more typical levels.
6. But say what you like about the implausibility of making money buying futures the way the Gorilla bought them today, he has market history on his side. Volume was huge on the way down this morning, hitting 1.7 billions by 12:30. It is climactic selling action. Further, the VIX has risen to 35.44, also a climactic level and a reversal signal by the standards of the past 12 months. Adv/Dcl volume and breadth are at climactic negative levels. And the 8 day stochasic oscillator is also flashing a buy signal. The accumulation/distribution indicator flashes accumulation over the past three days, and the Chaikin oscillator is rising. We have exactly the same chart patterns we have had on every other NDX bottom over the past few years. Finally, we do have those beginning of month inflows that can be put to work. So what's an 800 pound gorrilla to do, except his patriotic duty to run the market when its time?
7. There are some signs that the gorrilla might have a short ride on his hands. First and foremost, the rally today did nothing to change the NDX RS line. The boys at Janus have to be disappointed to see their horse come in second at the very point in this rally when momentum is at its highest. The declining NDX RS will ultimately crater this market. Today did nothing to alleviate that condition.
8. Second problem is the terrible NAZ breadth, up/down volume and new high/ new low trends which are still accellerating to the downside. We need to see some pretty good positive breadth tomorrow, or this market is toast. I expect tomorrow to be flat to up on the day. The S&P is a safer bet for an up close than the NDX. We have another two days under the umbrella of the "beginning of month effect", and then the wild cards including the size of the tax selling (which I believe will be huge), and the effect of the recent volatility on inflows. Keep your eye on the 11:00 o'clock hour.
9. Other than the NDX relative strength horror show, which primarily affects investment professionals, the mania among individual investors is basically quite healthy. For example, the ratio of call open interest to put open interest (all contracts, all exchanges including index contracts) has been falling steadily since 03/06, meaning that "investors" are holding more calls relative to puts. There is not a shred of fear or concern showing up in the options market. Thus, we cannot be surprised if the addicted reach ever deeper into those wallets and credit lines to fuel rallies. The difference is that they now lack staying power - endurance for the long pull. "
http://biz.yahoo.com/rf/000405/hf.htmlAccording to this article, it may be a one-two punch (stock market and trade deficit) that leads to the dollar's demise.
Dollar's nemesis seen looming after stock gyrations
By Swaha Pattanaik
LONDON, April 5 (Reuters) - The yawning U.S. current account deficit will haunt the dollar as heart-stopping lurches in U.S. stocks trigger fears that foreign money could stop pouring into the country, analysts said on Wednesday.
Stellar growth, a bull run in stocks, rising short-term interest rates, and big direct investment inflows saw the United States pull in more than enough foreign money to finance a record current account deficit of nearly $339 billion in 1999.
But such a trick will be hard to pull off if foreigners give the United States a clear berth after Tuesday, when the technology-laden U.S. Nasdaq composite slumped more than 13 percent at one point before bouncing most of the way back.
It doesn't even need foreigners to pull money out of the United States for the dollar to suffer -- with the U.S. current account deficit seen widening this year and next, all it would take is for foreign inflows to stay at their current levels.
``The U.S. already needs to attract $35 million an hour to finance its current account deficit and as the deficit grows, it will need even more money for the dollar just to stay still,'' said Nick Parsons, currency strategist at Commerzbank in London.
``The moves in the U.S. stock market will therefore be a double hit for the dollar -- they will not only dent consumer confidence but they will make it hard for the U.S. to attract the capital it needs.''
WARNINGS TO FALL ON ATTENTIVE EARS
No one can say financial markets have not been warned about the sword of Damocles which has long been hanging over the dollar.
Federal Reserve Bank of New York President William McDonough said as recently as last week that no one could predict how long foreigners would be willing to finance excess U.S. demand.
He added that the current account deficit had to shrink to around two percent of national income to be sustainable.
The deficit has already hit 3.8 percent of gross domestic product. It is expected by the International Monetary Fund to widen to 4.3 percent this year according to confidential figures obtained by Reuters on Monday.
Traders are likely to pay more attention to warnings about the risks to the dollar now that wild swings are becoming a daily event in the Nasdaq.
``The fact that equity volatility is through the roof should dampen foreign investors appetite to buy dollar assets,'' said Alfonso Prat-Gay, global head of foreign exchange strategy at J.P. Morgan in London.
Prat-Gay said the bank's risk aversion index had climbed close to the pre-Y2K peaks hit last year, with the speed of its climb beginning to resemble the rise seen during emerging markets crises in the past few years.
The key beneficiaries would be the yen and the Swiss franc, and maybe even the euro, he said.
The Swiss franc has been quick to profit, hitting one-month highs against the dollar in the past 24 hours.
The euro has been tardier to take benefit given its poor track record of sustaining rallies. But this could change given the foreign exchanges' notoriously short memory, analysts said.
``When you have such huge volatility are international funds really going to keep putting money into the U.S. given they are already overweight?'' said Lee Ferridge, head of global currency strategy at Rabobank in London.
``The U.S. actually needs to attract more money if it is to finance its current account deficit so the numbers just don't add up. Sentiment does not last forever and will shift quickly once this becomes clear.''
I disagree with Crudele. It may be politically the right thing to do but not "socially" (unless you mean socialism) the right thing to do.
That our equity markets absolutely cannot fail is extremely frightening. That we've allowed ourselves to get to this point of unsustainable growth is pure stupidity. In this condition, the markets will definitely fail and fail big at some future point in time.
If this isn't a wake up call to buy PM I don't know what is. Leave equities to the gamblers. Wait for everyone to get cleaned out and then step back in.
If your investment advisor has not "advised" you to exit the US equity market by now I would be looking for some freash perspective on what most certainly is a very dangerous situation.
I, too, am a humble midwesterner, mostly lurking behind the scenes - and will be adding TC's words of wisdom from msg 28064 to my personal HOF.
I also echo your comments in msg 28089 regarding dollar genesis. Forget stock market gyrations. The case for gold ownership is made by looking beyond our borders.
This is summed up most eloquently by FOA in his poignant essays in the "Gold Trail" page. For those of you who haven't "walked the trail yet," you're missing out on the core reason for owning gold. Strap on your boots, touch the "Gold Trail" button at the top of the page, and enjoy.
Today's Report: Politically Correct Intervention or Market Rigging?
http://www.usagold.com/Order_Form.html4/5/00 Indications
�Current
�Change
Gold June Comex
284.00
-2.60
Silver May Comex
5.14
-0.02
30 Yr TBond June CBOT
98~29
+0~07
Dollar Index June NYBOT
104.76
-0.09
Market Report (4/5/00): Gold gave up a little of yesterday's strong gains
in early trading as the markets seemed to calm down a bit this morning. As
soon as the stock market cratered yesterday, gold shot up re-establising an
old inverse relationship.
John Crudele, who writes with remarkable skill about financial matters for
the New York Post, published one of the most interesting and revealing
reports on yesterday's action. In it, he says:
Begin quote
"SOMETHING happened at around 1 p.m. our time yesterday that pulled the stock
market back from the edge of the cliff. Traders say it was almost like divine
intervention. One minute the Nasdaq was down 11 percent -- say it out loud,
"Eleven percent in one day" -- and then it suddenly rallied several hundred
points in the matter of an hour.
The Dow followed suit. Down 500 points around mid-day, the blue chip index's
decline -- along with the horrible showing of over-the-counter stocks -- was
destined to make yesterday's market an unqualified disaster for investors and
the country.
Then, traders said, someone started buying large amounts of stock index
futures contracts through two major brokerage firms -- Goldman Sachs and
Merrill Lynch. These transactions are usually done on the QT so we don't
really know how many of these contracts were purchased.
And unless the brokers tell, there is no way of knowing which of their
clients were making the purchases. Goldman wouldn't comment on this and
Merrill did not return a call for comment.
But traders said enough were bought to catch everyone's attention. In fact,
the buyers seemed to want people to know they had an appetite for stocks.
Then the market rebounded.
It didn't go all the way back. At the end of the day the Dow Jones index had
still lost lost 56 points or half a percent on the day. And the Nasdaq lost
another 74 points, or the equivalent of a 1.77 percent drop. Yesterday's loss
by over-the-counter stocks nearly put the Nasdaq index back to ground zero
for the year -- in two days all but 2 percent of its gain for the year was
gone.
It was real nice of Goldman and Merrill to stick their necks out like that.
In fact, it was downright uncharacteristic for Wall Street outfits to put the
thought of possible losses aside for the greater good.
Because of the purely unselfish nature of what went on, traders are naturally
suspicious. Hell, so am I.
"I think some one or more persons saved the market today. There was a
suspicious urge to buy stocks at an opportune time," says one trader. "Why
drive the Dow up 350 points in a half hour? That's never serious buying.
That's someone trying to establish prices," he adds.
I'm especially suspicious when the market suddenly rebounds at nearly the
very same moment that a member of the Clinton administration -- economic
advisor Gene Sperling -- is on TV telling investors not to worry.
And there's the obvious connection between Goldman Sachs and the
administration, the Wall Street firm having given Robert Rubin to the Clinton
administration as its Treasury Secretary.
Plus, what better way to make investors not worry than by having the stock
market recover a lot of the ground it had just lost. That gesture almost
makes a guy want to buy some stock -- bottom fish, if you are into sporting
analogies.
I'm not saying that government intervention in a collapsing market is wrong.
In fact -- except for the obvious contradictions with the free-market system
-- it is politically and socially a very right thing to do.
I've written about this before. And I've mentioned that Washington has had a
secretive group call the Working Group on Financial Markets, made up of
investment industry and government people, that would be in just the right
position to rescue the market.
Informally the folks on Wall Street call this the "Plunge Protection Team."
In February 1997, the Washington Post did a piece on this team, just in case
you don't believe it exists.
And while I can't swear that Goldman and Merrill are captains of that team,
they sure acted like it yesterday."
End quote.
Those of you who frequent this report are familiar with the shenanigans of
Merrill Lynch, Goldman Sachs et al. I would point out to Mr. Crudele that
though market rigging might be politically correct in an election year,if you
or I were to do it, we would find ourselves pleading our case before a court
of law. Why are Goldman Sachs and Merrill Lynch permitted to do it with
impunity? And not only permitted to do it with impunity, but encouraged and
sanctioned by the very same government that is supposed to be regulating such
activiy. Nick Leeson went to jail for that sort of thing. These laws about
market manipulation have their roots in previous altercations which ended up
in social and economic disaster and that's why they were put into place --
the very socio-economic disasters you believe they may avoid.
This all leads to one last point worth mentioning: While we look at this
rigging situation with respect to the stock market, perhaps we should examine
whether or not these same forces have been encouraged and sanctioned to the
same thing in the gold market -- only in this case to hold the price down.
Let me say that there are consequences in attempting to establish the
socialist promise of heaven on earth not the least of which is the abrogation
of the self-cleansing effect of free markets. What is most troublesome here
is that someone of Alan Greenspan's stature -- a student of the greatest free
marketeer of the century, Ayn Rand and one who constantly invokes the mantra
of free and fair markets -- would sit back and allow this to happen. Frankly,
it scares me and makes me wonder what's really going in the Beltway and on
Wall Street.
I am sure there will be great deal of comment about what happened yesterday
even as we go into a new trading session today. What investors should not
believe is what the newspapers trumpeted around the country this morning:
That somehow investors saved this market yesterday starting at 1 pm. Nothing
could be further from the truth. It was saved by a quasi-governmental
intrusion through two select brokerage firms.
The obvious question every investor should be asking himself or herself is
the most pressing one: Why does the government feel it has to save the stock
market in the first place? What is the problem with letting a market
naturally correct itself? Even experienced Wall Streeters believe corrections
to be a good thing. Why has that changed? What has happened in the financial
system that makes it necessary?
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 here ---> ORDER FORM <--- and make the appropriate entries.
Excellent comment from Vulture at Kitco on US dollar:
--------------------------------------------
Date: Wed Apr 05 2000 11:40
Vulture (The US$-Index Again ) ID#428270:
Copyright � 2000 Vulture/Kitco Inc. All rights reserved
Before arguing with the following, I urge you to read my related "Weekly Outlook" comment posted here last Monday.
Again, I will never hammer this enough, whether it is the PPT or any other collusion crowd aiming at preventing any sort of financial meltdown, the real issue is and will always be the external value of the US$. Any intervention in the mkt serves one and only one purpose: to prevent foreign money from exiting the US. Last Monday, I did mention the important 104.80 - 106.60 June basis trading range, and that any daily close below 104.80 would precipitate an important decline in the US$.
The US$-Index is your KEY indicator of future events to unfold: the fate of the stock mkt and the destiny of gold. Should it falter, it would mean that the authorities have given up on "crash protection". This is your ONLY reliable indicator that gold will be set for a major surge. Should it remain rangebound or head higher, that means the Fed and its cohorts are pouring everything they have ( mostly paper money which they liberally print ) in order to coax foreigners into staying invested in the Nasdaq,
Dow, Treasuries...
What you have to understand here is that the so-called US economic boom is/was entirely due to foreign money financing the huge ( $25 bln monthly ) trade deficit. Should foreigners "disinvest" out of the US and repatriate their dollars home ( sell these US$ for their respective currencies ) , the US garden of Eden will turn into a House of Pain, especially for Americans.
Again, I urge you to closely monitor the 104.80 level on a daily close. We were so close to sleeping below it yesterday, yet, magically, stock mkts rallied and the US$-Index managed to close above that key level at 104.85. This morning, it got even worse during european hours, traded down to 104.40, yet it has amazingly rallied and is trading back at 104.80 now.
I believe no one has any interest in breaking the range at the present time. The Fed is keen on keeping foreign money in, for obvious reasons, and perhaps also because US banks are not yet done scooping up cheap gold as a hedge against the ever increasing likelihood of future US$ devaluation. The European Central Bank knows it has more than $200 bln in unneeded reserves but fears that selling these US$ might precipitate the collapse of the financial system, obviously a prospect no one is yet ready to face.
This farce is reaching a climax, no one can predict when it will end. As for me, I am just suggesting you keep an eye on a pattern that should be a trigger for what we're all so eagerly expecting and is thus far failing to happen. When the US$ goes down the drain, gold will shoot for the moon. It always has and always will.
MK-Thanks for stating eloquently and analytically what I could not. I have NEVER thought a severe economic contraction (recession/depression) was likely until yesterday. I have NEVER thought a possible depression or anything the likes of Mr. Batra's prognostications likely. Now, I do. I guess I am just waking up to this whole PPT thing. I have thought all along it was just "right wing venom" :)(big smiley face).
First for you conspiracy buffs: All day yesterday, the Netscape business tab which usually shows index quotes when you open the home page was jambed on the opening values. You had to punch in the symbols to get a reading. No use frightening the sheep.
And now for my prayer: I need as much help as you all can give on this, because we have to reach a maximum number of people.
If your hierarchy begins with and end to a manipulated market, I have a proposal, perhaps not modest, but I think achievable. I assume that going head to head with Goldman Sachs and the Fed is in the realm of a death or glory charge. Read 'Do we have much of a chance?' It has been noted that officials will tell any lie and commit any crime necessary to ensure the continuation of their policies, no matter how mistaken, and this could drag on for years. As has been mentioned by Greenspan, so long as central banks are willing to lease gold to keep the price down, gold will remain cheap. They have more time, more money, and more gold than we do. Also, I dislike the thought of leaving the manipulators to continue
their work, knowing that, at the moment either of their choosing or when they see the handwriting on the wall, they ( especially Goldman Sachs ) will acquire all the free gold available and masses of paper gold at the cheapest possible price in order to cover their own positions, and make massive profits on the upside, even as they profitted by beating the price down previously. It has been suggested that in the event of an actual market crash, they will be able to cover their positions from distress sales by smaller players.
My proposal is to carry the battle to the enemy, but not in a frontal attack. I suggest that the key to unlocking the gold market is not gold, nor is it buying gold shares, nor waiting and hoping to pick up a few oats that the horse misses. I suggest that the key to the gold market - its achilles heal - is its link to silver. Assuming that the estimates I have seen are correct as to the rapid drawing down of reserves of silver, and remembering what happened to the gold price when the Hunt brothers tried to corner the silver market, I suggest a consortium, not of the giants, but of us all. We must remove from the market in excess of one hundred million ounces of silver bullion. Bullion, not coins or jewelry, for with the latter, we cannot be sure how large the pool, or how many will cheerfully sell at the possibility of a small gain. In short, one million buyers...of one hundred ounces of silver bullion each ( more for they who can or will ) .
Delivered. Unhedgeable. Unloanable. Unmanipulated. The quantity is small enough to fit inside a safe deposit box, the expenditure reasonable at current market prices, and let the shorts hold the price down as long as they can, for it will only rebound the harder on them. At some stage, Mr. Buffett will have to exercise his fiduciary trust to his shareholders and call in his leased silver or risk losing it. And better now, than when the world stocks are totally exhausted.
I myself, and my brother are buying one thousand ounces of bullion each. Yes, I could buy more of those 4 cent options for March 2001 $9 silver. Yes, certain securities would probably give a much greater return. And yes,eighty-five pounds of silver bars holding open the door or serving as a marking post for the dog is more than a bit of a nuisance. ( I think it would break the safe deposit box, and how to carry the thing ) . If your desire is actually to free the precious metals market from the hands of the few, help us. Talk to every precious metal internet site, forum, friend, and founder. Try to reach shareholders of precious metal company shares - what a way to enhance the share value. Pass this on, Buy some yourself, pay cash, and don't give your name if you fear government confiscation of bullion. Americans can buy it in Canada, ( perhaps in Mexico also? Not my field of expertese ) if they're really scared. Talk it up. Put the fear of god into the shorts. Have people report in as they buy, and keep running totals of how much has been taken out of the market.
Moral Hazard in the Clinton Government's Stock Market...
The following statement says it all:
David Schwerdt, 37, a Los Angeles banker visiting the
Big Apple on business, was one of them. "I held on to
everything. You don't want to panic. There's so much
money in the market, it has to go up," he said.
Thanks to Robbin Robert Rubin's efforts in concert with Mr. Greedspan, the American investor is entirely fearless and entirely certain his government will prevent him from losing a significant dime in the stock market. Let me repeat Mr. Schwerdt's most notable statement for consideration: "THERE IS SO MUCH MONEY IN THE MARKET IT HAS TO GO UP."
In other words, the American investor no longer believes in a free market but is absolutely convinced it is rigged by the government for his benefit and perpetual enrichment.
Who ever said that communism died when Russia's Yeltsin Era began? It is now alive and thriving here in America, courtesy of the Clinton government and its Wall Street owners.
Of course, like the Old Russian communism, a rigged market ultimately sows the seeds of its own doom, since trees cannot grow to the sky.
First, as a society gets richer and richer primarily via stock market speculation (as opposed to real goods production), then inflation is the inevitable result. A government can manipulate the CPI or PPI forever but real inflation eventually slaps everyone in the face.
Secondly, a society that grows significantly wealthier at the expense of its foreign neighbors will eventually breed great resentment. America's escalating wealth as a consequence of hedge fund currency raids in South East Asia, Latin America, Russia, etc.....plus the various currency (Japan, Canada, Australia, etc.) and commodity (gold and silver) carry trades inevitably creates resentment by those countries afflicted by such financial terrorism. No doubt it raises the likelihood of retaliation against America, in some form or another.
Latest update of The Week in Gold--Weekly Market Commentary by the WGC
http://www.usagold.com/wgc.htmlClick above for your convenience, otherwise, find the link throughout the week on the USAGOLD HomePage and on MK's Daily Market Report page.
An excerpt:
>>>>>>>>...the National Bank of Austria announced that, as part of the Washington Agreement on Gold, it had sold 30 tonnes of gold during 1999 and that it intended to sell up to another 60 tonnes before the Agreement expires in September 2004. The sales have been made on a forward basis via the Bank for International Settlements and will not become visible in the consolidated weekly report of the Eurosystem until the relevant delivery dates. The amount still to be sold will include sales to the Austrian Mint for the production of the gold Philharmoniker coin, which over the past decade has consumed an average 13.5 tonnes per annum. This announcement has had no apparent impact on prices, being seen as part of the Agreement and also filling the last gap in the intended sale of 2,000 tonnes over five years.
http://biz.yahoo.com/rf/000405/km.htmlHere is a summary of the current score, offered by Dana Saporta (economist with Stone and McCarthy Research Associates) as quoted by Reuters:
"The Fed already has over $19.0 billion in long-term rps outstanding and has purchased $1.55 billion in coupons during this two-week bank reserve maintenance period that ends today."
Saporta calculated that banking system reserves needed a final add of $2.2 billion.
The Fed was up to the task, adding $2.49 billion in temporary reserves through overnight repurchase agreements.
"The President's Financial Markets Working Group, dubbed PPT"
are sure as hell working overtime. I agree with John Crudele, MK's and F*s comments, though it is becoming so transparent, that I would consider it becoming counterproductive, eventually.
Even the ESF should have run out of money by now, so the only solution is the printing press, which will start to drive away foreign investors in droves with the first signs of softening of the $, after all the Egyptians of old already knew you can't build lasting pyramids upside-down.
While the history of the ESF has been mostly secretive, small wonder here, the PPT was openly constituted during the 87 crash, G-spans utterances were oil on the fire of the bubblesters towards the ultimate belief, that "US Investors"
will forever be immune to bear markets. A tall tale with a tall bill, which the man with the same name, probably won't have to pay personally, to the detriment of the rest of the world and eventually to the detriment of the US.
Real money - get you some - BTW, FOA your latest trail
hike was most descriptive, concise and I would say brilliant - thank you.
Regards and good luck CB2
"It has become increasingly difficult to deny that something profoundly different from the typical postwar business cycle has emerged in recent years. Not only has the expansion reached record length, but it has done so with far stronger-than-expected economic growth. Most remarkably, inflation has remained subdued in the face of labor markets tighter than any we have experienced in a generation."
"The first sign of the shift was the sharp rise in capital investment orders, especially for high-tech equipment, in 1993. This was unusual for a cyclical expansion because it occurred a full two years after the trough of the 1991 recession.
By 1995, the investment boom had gathered momentum, suggesting that earlier expectations of elevated profitability had not been disappointed. In that year, with inflation falling, domestic operating profit margins started to rise, indicating that increases in unit costs were slowing. These developments signaled that productivity growth was probably beginning to move higher, even though official data, hobbled by statistical problems, failed to provide any confirmation. Now, five years later, there can be little doubt that not only has productivity growth picked up from its rather tepid pace during the preceding quarter century but that the growth rate has continued to rise, with scant evidence that it is about to crest."
[TownCrier Note: expect Fed rate hikes to continue as needed. Oh, wait...he covers that next]
"As our experience over the past century and more attests, such surges in prospective investment profitability carry with them consequences for interest rates, which ultimately are part of the process that balances saving and investment in a noninflationary economy. In these circumstances, rising credit demand is almost always reflected in an increase in corporate borrowing costs and that has, indeed, been our recent experience, especially in longer-dated debt issues. Real interest rates on corporate bonds have risen more than a percentage point in the past couple of years. Home mortgage rates have risen comparably. The Federal Reserve has responded in a similar manner, by gradually raising the federal funds rate over the past year. Certainly, to have done otherwise--to have held the federal funds rate at last year=s level even as credit demands and market interest rates rose--would have required an inappropriately inflationary expansion of liquidity. It is difficult to imagine product price levels remaining tame over the longer haul had there been such an expansion of liquidity. In the event, of course, inflation has remained largely contained.
+
To be sure, the tripling of crude oil prices has left its mark on "headline" inflation rates and inflicted considerable pain on some sectors of our economy. However, there is little evidence, at least to date, to suggest that oil price increases have started to embed themselves more broadly in the underlying cost structure of American business--that is, beyond the direct effects of the higher energy costs themselves. Nevertheless, despite the very recent declines in the price of oil, there are risks here that need to be monitored closely."
"Some misalignments have arisen over the course of the expansion. Owing largely to the increased rate of return on capital and a sizable wealth effect, overall demand for goods and services for the past four years has been growing noticeably in excess of the enhanced growth in potential supply, defined as the sum of the growth in the working-age population and productivity. An increasing share of the goods and services required to meet this extra demand has been supplied by net imports, with the remainder the result of an increase in domestic production achieved by drawing down the pool of those we count as officially unemployed and those otherwise available for work.
Short of a significant opening up of our borders to more immigration, an increase in employment beyond the growth of the working-age population is limited to what remains of our shrinking pool of available workers. ...there is a point at which this safety valve for excess demand will effectively close, even in the face of accelerating productivity. We do not know where that point is, but presumably it would occur well before a full depletion of the pool of potential workers. When we reach that point, short of a repeal of the law of supply and demand, the scarcity of labor will almost surely induce a rise in hourly compensation gains that increasingly outpaces an even faster productivity growth--a condition that would cause unit costs to accelerate over time."
!***!
"Moreover, we do not know how long net imports and U.S. external debt can rise before foreign investors become reluctant to continue to add to their portfolios of claims against the United States. At that point, the safety valve of net imports could narrow or close."
"As I have argued previously, a substantial part of the excess growth of demand over potential supply owes to a wealth effect, induced by the rising asset prices that have accompanied the run-up in potential rates of return on new and existing capital. The rise in stock prices, as well as in the capital gains on homes, has created a marked increase in purchasing power without providing an equivalent and immediate expansion in the supply of goods and services. That expansion in supply will occur only over time.
+
The persuasive evidence that the wealth effect is contributing to the risk of imbalances in our economy, however, does not imply that the most straightforward way to restore balance in financial and product markets is for monetary policy to target asset price levels. ... The risks of investing in equities come primarily from uncertainty about future earnings and about the rates at which those future earnings should be discounted, and much less from changes in overnight interest rates, the principal tool of the central bank. Consequently, even if we were to foster somewhat larger movements in short-term rates to address changes in stock prices, I doubt that investors' perceptions of equity risks would be much affected and thus that equity prices would be meaningfully influenced. In short, monetary policy should focus on the broader economy and on pending inflationary or deflationary imbalances. Should changes in asset prices foster economic imbalances, as they appear to have done in recent years, it is the latter we need address, not asset prices."
http://www.usagold.comSeems like we had a clear episode of inversive volatilities yesterday with the panic into gold opposite the panic out of stocks. I saw the dollar intraday chart looked just like the Nasdaq and DOW. All three did the BIG VEE, very interesting. Normally a big buyback like that is something to spring off of but in this case many secondary stocks are still down and are going sideways. So a few majors get some bottom fishing action, how many people still want out at a loss? When you're coming down the backside of the mountain don't stand on the trail too long or else you could get runover by the decending stampede. The run into bonds could easily be short circuited by a drop in the dollar. The see-saw between money flows out of the DOW stocks into the tech sector then the reverse with the Nasdaq selloff and a rise in the DOW. Yet yesterday we saw both the DOW and the Nasdaq act together. Oops, tried both doors, they're both dead ends. This "new April cash" has nowhere to go. Bonds you say? Did the dollar index follow the stock indexes? Or am I blind? The stock market backs the dollar. Dollars are redeamable in the stocks they can buy. If not the bubble there (inflated stock prices) then it will be in inflated something else. The key to the POG is what the BOJ does with its dollar supporting mechanism. Japan's leadership has never been quick to change a failing policy. In the 1870s Japan lost most of the gold in their country by insisting that it be held to their exchange rate to silver and not the world ratio. Traders scammed the banks by dumping silver for gold and Japan ended up with a serious run on its banks for gold. Bakumatsu Currency Crisis. The deal where the Japanese cheapen the yen to foster exports is what Reagan did in the 80s. How can worldwide currency dabasement remain an acceptable policy of major nations. Is the dollar strong because the other nations want their currency cheaper? Reganomics proclaimed it was such an advantage to have a cheaper dollar and it didn't really work but people think it helped exports. So the Euro is "kept cheap" and the yen is "kept cheap". What is the end result of this cheapening? You get to float a lot more loans with a currency that is perceived to be more easily obtainable in the future. So as a smart banker you write lots of loans when your currency is cheap and once everyone has loans out, you then raise the value of the currency so you get more for yours that you collect in loan payments. The Euro will reach that stage II where keeping it cheap is no longer desireable.
Once the Saudi's fully accept Euro's for oil then the jig is up. Taxes in the US would go so high to make up the deficit that we'll be sitting at the dock of the bay watching the tide roll away.
What we are entering is a game of corporate subversion between Republicans and Democrates. The Republicans want the economy to get more unstable and skitzophrenic so they have a "crisis to solve" yet they want it fixable and not too ruined. Merely bringing to light the reality of the delusion would do it. The Democrates want the spoof kept up at all costs. There is no way this overextension of markets can remain calm through to the election. The big corporations (especially oil) want BUSH in office and they will manipulate Japan to mess with the dollar to derail this train of smoke and mirrors. We can watch what happens. How would you get a Republican elected with the no problems economy we now have?
Fund managers are in a wait and see attitude, I think. Any stocks bought now are held very loosely with the trader's hand held over the mouse with the sell order and password pre-entered. At a click of a 100,000 mouses we could go into freefull again. That's for the ones going long. Who is out there trying to establish short positions at the tops of rallies? (everyone). It was merely the tremor before the quake. So let's say the index stocks rally nice for three days......the rest of the unsupported secondary stocks could go sideways and cause the public to loose faith in the tulipmania.
I see gold being more influenced by international events than by what is happening in the US. New leader in Japan, elected or appointed? A handpicked conservative to cater to big Japanese corporations and not the Fed. No matter how much foreign held dollars get recirculated to pump up the tulip garden there will still be a vast quantity of dollars looking for redemption. If foreign dollars decide to chase the "really cheap internet sector" it will not change the earnings outlook for these companies which is seriously flawed. The entire internet and non-internet economy is dependent on consumer spending. Consumer credit is the key to sustained spending and employment. With companies scrambling to show a profit, they resort to layoffs and consolidation. Mergermania is a buzzword for "keep only the best and layoff the rest". The small personal bankrupcies are like the tiny beer bubbles floating up and making larger bubbles. Corporate downsizing, mergers, thinning profit margins.....all produce the "fizz" of personal bankrupcies due to layoffs. People laidoff can easily find work but the pay rate is often much less and debt service remains.
People expect Harry Hardworker and Johnny Datek to jump back in and support their stocks, but they "bought and held" and never sold so they can't buy because their accounts just got reduced to 40%. So the talk on the street is "short term holding only". With no definable pattern trend for even professionals to follow the wannabees are going to "ride and hide" during the "pump and dump". The only certain element of this market that is as real as Gibralter is the massive insider selling that will occur no matter what the market does. What would you do if you were a CEO in a company that changes its business model every 6 months. You'd sell and sell and sellout. "We aren't in hardware anymore but most of our revenues come from that as we phase it out. We are going with the Information Technology model because we just trained all our hardware departments how to do software consulting. Quite a big step. But we made it and after we reorganize since our latest acquisition of "40 Kids and a Modem Entertainment" we should be highly skilled at 3-D gaming adventure in virtual reality. We have found that letting the new kids, I mean employees, play "action chess" actually strengthens the mind for drawing networks on paper. And since we want to remain flexible we need to keep mentally active while we keep the commitment to non-commitment. When some bricks and mortar relic of a corporation wants to merge, then we are ready to get a real business model."00624b8859
People think that funds are wildly dumping stock. They are only taking their que's from the insider selling that they see as a major threat to the stability of their portfolios. "If he is going to sell that much, then I'm selling too".
Great thought - as Oct. crash 87 has been alleged computerize selling? - As I'm far too dumb with computers, I still would feel there would have to be some kind of an outside kickstart. In a market meltdown of these proportions even computers wouldn't (want) to know, when and why to trigger buying programs. Though, admittedly it just might have been GS & ML to turn the market on the basis of computer programmed data based on fair or other value calculations on and on behalf of themselves.
Brokers usually don't take these kind of chances - and for sure not to the benefit of their sheeple, the're always more out there - so? computers do what the're supposed to do - calculate the hedge/risk strategy, but they couldn't have had a clue as to when certain parameters would have set in in unprecedented markets, they have been setting up for so long.
Even if all the old rules have been aborted, margin calls are a final SU(r)Vival line for investment banksters. The full force of margin is yet to be tested as even outside help may prove to be inadequate in the long run. As it goes, it's better to bet on safe side and help your cronies out once in a while - as long as it's not going to be all the while. For that it seems too late - even if GS is still :-)!
F*rfel the buggers - and go gold - CB4 (I'm doubling up)
What scares me with all this talk of 1929 repeating, America bust or particularily the tone of it in my mind is the sorry fact that millions of people are starving in the world now!. In Jesus, Allahs, and Buddahs precious names,(In any order) I would be literally sick from stress by the concept of millions more suffering.
I am sure Jesus, Allah and Buddah could have sat around the same fire in the ashes for eternity contented never having an argument and I have faith enough that surely Hydrocarbon man has found and learnt something from the Golden flames by now through times like these that at least is slightly better than the best we could manage to do the last time these pressures presented themselves. Regards.
NASDAQ rallies, surging Oracle System(ic) risk(s) and other tech stocks - forgot to state 20 points barely. ... DJIA declines ... well forget it - we know - by now ...
I'm not worryin' about Elian (BTW, why don't they just disappear into the interior of the country). I'm not worryin' about the stock market. I just sold some stocks, finished up for the day and am watching Pokemon with my kids (it's harmless and fun really). I am thinking about how to earn more real money; what a pleaseant afternoon!
Did you know a Raichu is a fully evolved Pekachu without the speed moves?
www.GoldenSextant.comAfter the events of the past few days with stocks swooning only to recover, I re-read a post by Reginald Howe which was written on March 14, 2000. It was e-mailed to me by a friend and confidant here at Centennial. I highly recommend everyone to read this article because it answers a lot of questions which have been posed at this forum. According to Mr. Howe, Greenspan is repeating the same mistakes which he claims doomed the economy in 1927-29. Mr. Howe is quite a scholar and provides many links to back up his argument. Whether things work out as he believes, only time will tell. But the parallels are chilling.
I want to help, but I have a problem. I have already bought almost 7000 oz of silver. Since a lot of it is pre-1966 coins (90% silver), the total weight is about 600 lbs.
I will be moving in a few months and am pretty much at my limit (I promised my wife to lay off buying gold and silver until we buy a new house).
Am I obligated to buy an additional 100 oz or can I rest on my own record of taking silver out of the hands of the industrial system?
What is really chilling to me in what manipulation we have all witnessed in these markets is the fact that nothing exposing the workings and inner organization involved is really layed out anywhere. Sure we on this site and similiar web sites know a little and surmise quite alot. Still, no ,Deep Throat, has come forth from any of these Banks or Wall Street firms. There's no Drudge, Frontline, etc., expose` or investigative analysis.
As far as Barrons, Wall Street Journal, Investors Business Daily, they are all tout rags, who wrap themselves in the cloak of, "Free Markets" and fair "Capitolism". Hypocrites who are ready to come down with both feet on any entity or cause they feel safe in trampling. Or who in their exalted state as watchdogs are a threat to the money game. So with the kind of turn-around, obvious, large scale market manipulation we had yesterday, not to mention the ongoing gold and silver assasination, will there be any "Insider" that will come forth and shed some light on the who, what, where, and why that this manipulation policy is about? Not Yet. The Players on all levals are paid and taken care of well. They are content in their greed and mission because they implicitly know they have much to FEAR if they don't stay silent. What we have here is a powerful Politico-Financial Establishment Overlord whose dominance and greed for power and money is what is in their minds too big to fail. All below must toe the line and live in fear of an infraction against the system. Fear and pay those Taxes. Who knows where this is all going to lead too. Elements of this spectacle contain fascism, communism, socialism,totalitarianism,fabianism..., but most now is an exercise in CANNABALISM.
I think the greatest tragedy of the corrupt Clinton regime is this:
These guys had the chance to move America away from imported oil-dependency.
But they blew it, not simply by moving far too slow in developing alternative energy sources but even more importantly by creating the false illusion of unlimited cheap gasoline availability. That illusion set the stage for the enormous demand for gas guzzlers (SUV's) and those vehicles have done more to endanger gasoline availability in this country than any other demand factor.
Even worse, they instigated the conditions by which this country's markets have become dependent on foreign money in order to sustain bubble stock market valuations. They did this via a combination of hedge fund currency raids PLUS currency and commodity carry trades.
So the big question is this: how can a country so dependent on foreign oil and foreign funds inflows still be considered "the strongest country in the world?"
From all indications, the American behemoth is more vulnerable today than at any other time in history.
All parallel analysis between now and 1929 that I have read appear to leave out the one fact that makes today quite different in crash potential. In 1929 Stock purchasers could borrow 90% on Margin. That resulted in a margin quantity 9 times the value of purchaser's input, whereas today we only have an equal amount. That's 9 borrowed dollars for every investor dollar then, compared to one borrowed dollar for every investor dollar now.
If for discussion sake we assume 50 billion investor dollars in margin accounts, we would have 100 billion dollars of market capitalization being held on margin. (And 50 billion in margin debt outstanding)
Were today's situation truly parallel to 1929, that 50 billion dollars of investment would be supporting 500 billion dollars of market cap with a margin debt of 450 billion! That's a volatility factor of 9:1 in 1929 versus today. (And a "Wealth factor" 5 times greater)
When brokerage houses had to "Force sell" accounts to cover themselves at a 10% drop, the chain reaction was far more explosive than what would happen now to head off a 50% drop. Imagine yesterday's trading if margins were at 10%, and margin debt 9X the size of what exists today was wiped out.
That's enough default to create the end of the financial world as we know it!
Since we cannot communicate through normal channels, let me do talk with you through this esteemed Forum.
I have received your note and I agree that history is a teacher with respect to PPT operations -- that these short works can act as prelude to the greater symphony. I will visit the link you suggest in a quiet moment and absorb as the recommendation comes from a respected source. And thank you for taking the time to write me.
Now, with respect to your own extraordinary posts for which we are all grateful: At times, my schedule and the weight of mail received makes for dropping the ball on important correspondence that should have found its way to the Forum. If I have not posted something you have sent, it is an error of ommission not commission. Though you've never mentioned this as a problem, I fear that I may not have posted a correspondence as requested and I apologize for that.
(At the same time, I want to say to all who send me correspondence (whether by e mail or post) that it is all read, all appreciated and it all has its effect. Please keep it coming, even if I don't (cannot) respond to every message.)
Mr. Holtzman, please send further communications which you intend for the group to this address:
sitemaster@usagold.com
Randy will make sure your words are posted on the board, unabridged as usual. That way we can both be assured that the job will be done as it should.
If there is a way I can relay a posting code to you anonymously, I am happy to do it, as you are one of the posters I would trust to maintain your anonymity with full respect to this Table now and in the future. Please call Marie collect if this would work for you. I will give her your code first thing tomorrow.
If you wish to make personal contact with me on any matter, please know that the door is always open. Your thoughts and references are always appreciated.
Good point about margin....just remember that most of today's margin leverage is not in margin accounts, it is in derivative trades....for example stock options and commoditiy futures. Also, there is a much larger participation in capital markets today...even those who have "safe" money market deposits are part of the story.
A lot of people may be reconsidering their concepts of wealth in the next few years.
The regular ladies and gentlemen on this forum are wealthy in their minds and hearts....and those who hold to their golden convictions may be blessed with golden wealth...(and might I add silver wealth as well).
You're wrong only about one thing; the blame to go 'round regarding energy dependency goes back to 1980. From that point onward, successive administrations and pols at all levels are responsible. We've had twenty years to wean ourselves from the ME tete. Recall that coal gasification was a strategy employed by the germans out of necessity in WWII. That's one alternative. There are others. We've made a tremendous faux paux.
On all other points I agree. I know you don't care (because you've said as much) but this needs to be pointed out.
Good point about margin....just remember that most of today's margin leverage is not in margin accounts, it is in derivative trades....for example stock options and commoditiy futures. Also, there is a much larger participation in capital markets today...even those who have "safe" money market deposits are part of the story.
A lot of people may be reconsidering their concepts of wealth in the next few years.
The regular ladies and gentlemen on this forum are wealthy in their minds and hearts....and those who hold to their golden convictions may be blessed with golden wealth...(and might I add silver wealth as well).
Hello. In todays commentary you ask, rhetorically, about why this frenetic of a level of correction denying, market manipulation?
My vote for the reason goes to the increasing level of financial instrument, "sophistication", that has now reached multitudes of counterparties being exposed to trillion, upon trillion, upon trillion dollars of risk. If dollar,interest rates,debt expansion etc., don't stay in some computer driven balance our whole financial system will explode like a piniata that Mark McGuire takes a swing at.
I've sat at this table of esteemed knights for almost one year now. Initially, after my first week of lurking, I could not sleep for 4 successive nights until I bought my first 100 lot of old world coins from CPM. Since then, I have been immensely humbled by the patience and kindness so many here have shown me. I am truly nothing more than the Court Jester.
I just want to say one thing. The action in the markets Tuesday has me more concerned than I have ever been these last twelve months.
First for you conspiracy buffs: All day yesterday, the Netscape business tab
which usually shows index quotes when you open the home page was
jambed on the opening values. You had to punch in the symbols to get a
reading. No use frightening the sheep.
And now for my prayer: I need as much help as you all can give on this,
because we have to reach a maximum number of people.
If your hierarchy begins with and end to a manipulated market, I
have a proposal, perhaps not modest, but I think achievable. I assume that
going head to head with Goldman Sachs and the Fed is in the realm of a
death or glory charge. Read 'Do we have much of a chance?' It has been
noted that officials will tell any lie and commit any crime necessary to
ensure the continuation of their policies, no matter how mistaken, and
this could drag on for years. As has been mentioned by Greenspan, so long
as central banks are willing to lease gold to keep the price down, gold will
remain cheap. They have more time, more money, and more gold than we
do.
Also, I dislike the thought of leaving the manipulators to continue
their work, knowing that, at the moment either of their choosing or when
they see the handwriting on the wall, they (especially Goldman Sachs) will
acquire all the free gold available and masses of paper gold at the cheapest
possible price in order to cover their own positions, and make massive profits
on the upside, even as they profitted by beating the price down previously. It
has been suggested that in the event of an actual market crash, they will be
able to cover their positions from distress sales by smaller players.
My proposal is to carry the battle to the enemy, but not in a frontal
attack.
I suggest that the key to unlocking the gold market is not gold, nor is it
buying gold shares, nor waiting and hoping to pick up a few oats that the
horse misses. I suggest that the key to the gold market - its achilles heal - is
its link to silver.
Assuming that the estimates I have seen are correct as to the rapid
drawing down of reserves of silver, and remembering what happened to the
gold price when the Hunt brothers tried to corner the silver market, I suggest
a consortium, not of the giants, but of us all. We must remove from the
market in excess of one hundred million ounces of silver bullion. Bullion, not
coins or jewelry, for with the latter, we cannot be sure how large the pool, or
how many will cheerfully sell at the possibility of a small gain. In short, one
million buyers...of one hundred ounces of silver bullion each (more for they
who can or will).
Delivered. Unhedgeable. Unloanable. Unmanipulated. The quantity is
small enough to fit inside a safe deposit box, the expenditure reasonable at
current market prices, and let the shorts hold the price down as long as they
can, for it will only rebound the harder on them.
At some stage, Mr. Buffett will have to exercise his fiduciary trust to
his shareholders and call in his leased silver or risk losing it. And better now,
than when the world stocks are totally exhausted.
I myself, and my brother are buying one thousand ounces of bullion each.
Yes, I could buy more of those 4 cent options for March 2001 $9 silver. Yes,
certain securities would probably give a much greater return. And yes,
eighty-five pounds of silver bars holding open the door or serving as a
marking post for the dog is more than a bit of a nuisance. (I think it would
break the safe deposit box, and how to carry the thing).
If your desire is actually to free the precious metals market from
the hands of the few, help us. Talk to every precious metal internet site,
forum, friend, and founder. Try to reach shareholders of precious metal
company shares - what a way to enhance the share value. Pass this on,
Buy some yourself, pay cash, and don't give your name if you fear
government confiscation of bullion. Americans can buy it in Canada,
(perhaps in Mexico also? Not my field of expertese) if they're really scared.
Talk it up. Put the fear of god into the shorts. Have people report in as they
buy, and keep running totals of how much has been taken out of the market.
with 7Koz of junk silver, you are well positioned...my advise to you is to summarize in 500 words or less, why buying 100 ounces of silver for delivery (at less than $1000 including postage) is a solid investment...and then sending a copy to everyone you think will listen....
What absolutely blows my mind in silver is the fact that shrewed Mr. Buy and Hold Buffet is sitting on at least 100 million ounces of silver bullion...which is getting awful close to 50% of the entire world's liquid vault silver...a massive corner on the market!!!!!
Does anyone here remember those adds run in the 70s where the camera pans across some scenic landscape and on to a roadway...and suddenly, a car comes bursting out of the empty road!!! The trick photographers had taken a real scene and carefully replaced the real road with a paper facade which had such a perfect replica of the real thing that the viewer believes he is still looking at reality....and then, hidden behind the paper comes a real car zooming along...its reality hidden by the paper story in front...until the moment it bursts through and the illusion is shattered.
Let's say that the gold supply deficit today is 2000 tons...that is still only about 2% of known gold in wealth storage. And the Venerosso estimate of 13,000 tons short represents about 10% of physical stock. The moral here is that at some new price level, there is still enough gold to meet future demand.
With silver, which is an important industrial commodity but has been leased out like a PM. The short position is over 100% of 1 years total demand and known stocks can hardly cover deficit for one year...and if Mr. Buffet holds...well closer to six months....and it will take more than $10-20 pricing to convince me and White Rose to send our junk in for fiat.
Another very important consideration...70% of the worlds silver production is silver which is recovered as a "side product" of copper, zinc, and lead mining. There are very few mines which are primarily silver mines...and those mines have not been getting a lot of new investment lately. Thus, unless the demand for Cu Zn and Pb rise 20-30%, it is hard to imagine silver production rising...unless silver prices rise so high that Cu Zn and Pb miners can make more money just getting silver and stockpiling base metals.
I haven't posted here much lately...but tonight I am back in my usual mood...SILVER IS THE POOR MAN'S GOLD.
I tell you folks...the day will come when you can hold a silver eagle in your hand and call yourself a lucky fellow...and maybe even buy a nice two piece business suit or a good restaurant meal with it (at least if you were willing to convert to fiat before you dine).
Like I said last night...lately I've kept a 1998 silver eagle in my pocket and I'll show it to people and say "do you know what this is?" And I tell them that 1998 was the year that Warren Buffet cornered the market on silver and nobody noticed.
MarkTalk thanks for the referal to Gold Sextant that may induce to exercise a few synapsis into twitching mode :).
Hi-Hat. my friend, Check this one out for madness!. I brought a few humble acres a short while ago with the genesis of a stream quietly trickling through the back of them.
On the properties are three springs in from the stream that further feeds it at an average rate of about 120 liters a minute. The stream feeds and eventually leads to a rather large Government dam some 30 kilometers away through which they tap and feed the water to the general public all over the joint including the place from whence it came to ironically arrive at the front of the same said properties. On the property at this stage is a simple water tank and a modest shed and remember these springs.
Now the Authorities want ME to pay them an astonomical 37 cents for every thousand liters used from what they call there scheme water. A scheme !!?, more like a shifty shiesty crafty cunning sly devious scam based on power and a PHD in unfettered blind GREED !!!.
If there really was a major catastophe one might imagine the responce of these ungrateful greedy selfish animals if some poor vagrant sod simply wanted a drink of water from one of there taps. So how much more of a problem will we have with Gold in trying to get back to the source of the problem ?. Perhaps we are looking in the wrong spot?, perhaps we should all be having a closer look at ourselves ?. Dispite drowning in it, this lot would have me believe that water was Gold.
We ask ourselves what is being manipulated ok "GOLD" I am asking myself, "what isnt" ?.
http://www.mrci.com/qpnight.htmThey're all looking pretty grim right now for equities, but after what Oro said, I'm not sure it means much for tomorrow's action, since the PPT seems to be able to pump them up in a jiffy.
Fortunately for us, the crisis in silver is so close, that long before the likes of us could convince 1 million people to buy 100 ounces each...the silver train will crash.
Berkshire Hathaway may state that they continue to lease silver....but knowing Mr. Buffet can we suspect that he is only leasing just enough to say he is leasing???? If central banks can say they are selling gold and not really sell it to anyone but other central banks...why can't Mr. Buffet play the same game and say he is leasing silver and not really be leasing it (much)?
Let's take a good psychological look at Mr. Buffet's motives here:
Mr. Buffet is a value investor who favors asset value and book value over rate of profit growth or high P/E ratios...he likes growing companies with monopolyesque market positions who have solid cash flow, reasonable debt loads....he likes to own dominant positions in any company he gets into...because he likes to have serious voting power as a shareholder.
He is also a very patient man....today he looks bad because he is not on the internet bandwagon...still "stuck" in the "old economy"...well, well, well, time will tell, tell , tell.
Now Mr. Buffet went out in early 1998 and pulled off one of the most amazing feats ever seen...he bought close to 20% of the world's vault silver at historic rock bottom prices and the market really only reacted in price because they heard the news after the sale. Mr. Buffet absolutely understood that he could only do this because the paper illusion of silver was the pricing mechanism.
Now, Mr. Buffet has three options:
1. Sell his silver at today's paper price and make a paltry return on the money he spent two years ago. Does anyone believe that this is his style????
2. Lease out most of his silver and stand in line with all the other silver leasing banks in the world trying to make counterparty claims when it explodes...thus diluting his vote in the chaos by a factor of 1:10, and forcing himself to accept a "cash settlement" that has nothing to do with real silver price. If this is so, why did he insist on delivery from the start?
3. Reduce the leasing on his silver to absolute minimum levels so that when the silver paper market burns, he is sitting pretty with well over 1/2 of the worlds highly liquid silver supply (vault silver)...he will be the only "voting shareholder" in the silver world at that point.
I agree -- let the market clear itself -- NOW -- no matter what the cost. Because I believe the longer it goes, the worse it will be when it finally unwinds.
BUT the Hong Kong government propped up the Hang Seng a couple of years ago. If I remember correctly, it's been selling the shares back recently.
I don't believe in Santa Klas, but can someone tell me what harm was done, at least in the case of the Hang Seng?
http://www.usagold.com/cpmforum/tools/post.html I was reading someones message the other day and there was a comment that referred to a 1985 law passed about reporting gold ownership or reporting the buy/sell transaction. I'm somewhat familiar with the 1933 law that confiscated privately held gold but not the '85 regulation. Can someone bring me up to speed on this? I wasn't aware that there was any reporting requirement.
but had forgotton the analogy to todays America. I'll have to rent it again to relish the irony. Do you watch the History Channel? They have been running a series lately on "The Nazis: A Lesson From History". Der Furher (I mean Clinton, apologies to Hitler) is a practicing National Socialist. (I believe this is/was the definition of Nazi.)
From attempts to usurp control of healthcare, to gun control, to the bombing of non-combatants in Kosovo this administration has trampled liberty and individual rights while hypnotizing the masses with easy credit and lax morality. It is no wonder the GOLD ownership has fallen out of favor with most in this nation. The market manipulation we witness really ticks me off on one level. On another level, I really am thankful that so many here have done so much to alert me to it. I believe that every generation must pass its time of trials. Integrity, fidelity, honesty, and freedom in thier purest forms are never cheap. Their incredible value must be taught to each generation of fresh faces. The price is never cheap. The true value of GOLD is, of course, in its inherent "integrity". Not to say that an inanimate object could possess such a divine trait, but GOLD enforces "integrity" through continuity of value. It is what it is, and it claims to be no more or no less. It is at one time, only money, filthy lucre. But, to quote Dylan, "his clothes are dirty, but his hands are clean." Gold is clean because it doesn't derive its value dishonorably, through debasement, or by lending for interest. These are the traits of paper gold. (Ah... paper gold... the angel of light....may stocks and options make gods of us all.)
Now the Authorities want ME to pay them an astonomical 37 cents for every thousand liters used from what they call there scheme water. A scheme !!?, more like a shifty shiesty crafty cunning sly devious scam based on power and a PHD in unfettered blind GREED !!!.
..........................
How greedy really....?
At those prices you could live happily on about 2500 liters per day and pay about $300/year....25-30 years without inflation and you would be at about $10,000. Now, assuming that you wanted to develop that spring as your own supply. Is it possible that the cost of digging and maintaining a small reservoir supplied by the spring, and paying a contractor to bury a pipe below the frost line could cost you as much as $10,000 in the end?
Are you willing to extend the project and offer supply to your neighbors?? Along with implied liabilities???
The community I live in does not have water service. We all have wells...and some poor neighbors have sulphur in the water....I can tell you that they day that "municipal water" is here, the market value of my home will go up at least $20,000. So even if I had a spring as lovely as yours, I would be glad to pay the price for the water utility.
Improvement of water and roads is one of the biggest blessings a community can have...perhaps you will be happy knowing that even though your water flows 60 miles in a circle back to you...your 37 cents is part of a grander plan that gives you other benefits.
Wish I could go sit there with you and drink from the source and watch the deer...
Yeah yeah yeah !. Talk about manipulation!:. If I asked someone not to think about the colour Silver ?, one must first assess that information in order to evaluate what was just said. The manipulation is in Mr Buffets head and ours if we choose to believe it.
1)Mr Buffet the person . 2) Mr Buffet the behaviour, and behold an objective view of the issue. Sometimes the truth as discursive or as near as we can get to it, can, as it just did then, by your absolute deductive brilliance, jumped out and pleasently smacked me clean in the kisser. Thanks for that :).
I did not write this piece, although it has a certain quality of style that is similar to my own (smile), and certainly I agree with the spirit of the message - as I also agree with your kindly put rebutal. One certainly does not know whether the edge of the cliff is near when stumbling around in the fog, yes? A mass frontal attack on the the evil doers by an organized group of little snapping silver bugs WOULD, of course, be only successful if time was on our side. But we know also that time really IS on our side - and that we don't really need a frontal attack because of the severity of the short position of the evil ones. Time really will tell on them, yes? But there is more sense in the strategy of accumulating for me.(smile) I am not a day trader, and I do not mind the wait. I do not, except for a sense of moral outrage, want this manipulation to end. I buy more. An investment of time for greater rewards later.
Also I am already doing as laid out in the plan. As a small (very small), but unapologetic little silver bug with sharp teeth (but small budget)I follow the plan with vigour, averaging a purchase of physical silver to the quantity of 50 oz. per month. This is a very practical plan. Silver door stops are very nice to look at, and I love paper so there is additional service in paper weights. Most I use as fertilizer, however, in select little "gardens" about the property. Over the years it accumulates.
This too is part of the plan, yes?
My real worry in your mention of the Buffett silver buy is whether in the coming chaos some sort of calamity might not be orchestrated against him to force him to release this to the market. This could be by conspiracy - or just the result of collapsing markets as we all witnessed yesterday.
Result: posponement of the silver bull as he sells into the market at the bottom.
As it stands now I estimate that if this silver market does not blow up this month, it will probably last the summer. April was the earliest time by my estimates (and others) for them to run out of physical. Or perhaps the Silver Institute is "accurate" (snicker).
Or, on the other hand, the NASDAQ and or the DOW could collapse first.
Nobody knows. Nobody (except maybe Goldman Sachs.)
(But isn't it interesting that they now keep silver THIS low - even as the deficit deepens!?)
Peter Asher, I DISAGREE with your SM margin analysis..
Peter Asher (04/05/00; 19:00:21MDT - Msg ID:28146)
MarkeTalk (04/05/00; 17:22:57MDT - Msg ID:28141)
All parallel analysis between now and 1929 that I have read appear to leave out the one fact that makes today quite
different in crash potential. In 1929 Stock purchasers could borrow 90% on Margin. That resulted in a margin
quantity 9 times the value of purchaser's input, whereas today we only have an equal amount. That's 9 borrowed
dollars for every investor dollar then, compared to one borrowed dollar for every investor dollar now.
If for discussion sake we assume 50 billion investor dollars in margin accounts, we would have 100 billion dollars
of market capitalization being held on margin. (And 50 billion in margin debt outstanding)
Were today's situation truly parallel to 1929, that 50 billion dollars of investment would be supporting 500 billion
dollars of market cap with a margin debt of 450 billion! That's a volatility factor of 9:1 in 1929 versus today. (And
a "Wealth factor" 5 times greater)
When brokerage houses had to "Force sell" accounts to cover themselves at a 10% drop, the chain reaction was far
more explosive than what would happen now to head off a 50% drop. Imagine yesterday's trading if margins
were at 10%, and margin debt 9X the size of what exists today was wiped out.
That's enough default to create the end of the financial world as we know it!
-----------------------
Peter, although today's investor is required by his stock broker to put up much more margin than in 1929, in reality, based upon current American debt per capita figures (the highest in history) PLUS American savings per capita figures (the lowest in history), then there has never been so much debt held by the investing public and so little savings. In that sense, the average American investor is leveraged to the hilt.
So although brokerage houses force investors to put up more margin today, in fact, the average investor has never had greater inclination nor an easier time getting a house mortgage (1st or 2nd), then using the proceeds for stock market investment. Today's average investor has all variety of credit card options that were not available in 1929, and he can obtain huge cash forwards/lines of credit that can be utilized also for stock market investment.
So although today's average investor may hold 50% margin at his friendly stock broker's office, if you include his other forms of leveraging (primarily house mortgages and credit cards), then I would imagine that his aggregate debt vs. aggregate net worth puts him not too far from the 1929 leverage factor of 90% debt against 10% deposit.
That is why Monday's little market event might be all that was needed to begin an amazing snowball effect leading toward a climactic market crash.
If enough margin calls were issued on Monday, and assuming the market does not snap back immediately this week, then conceivably hundreds of thousands of investors will be compelled to begin a deleveraging of their lives. The margin calls might force all variety of real estate liquidations (as a result of mortgage borrowings used for stock market investments), not to mention other forms of liquidiations to satisfy credit card companies demanding repayment of advances utilized for stock market investment.
Although this de-leveraging will not occur overnight, its real effects might begin to show up in the stock market in another month or so.
From my perspective, if aggregate debt levels held by American investors are as large as they appear...and if their savings are in fact negative now...then in the absence of a quick stock market run up over the next few days, then another huge round of forced stock market liquidation should show up as early as a month from now, but probably not later than two months from now.
I guess what I'm saying is this: assuming the Consumer Bureau stats are correct, then Monday's drop was in fact a stock market crash, with a the great confirmation downspike looming.
Just some ramblings from the Blade!Well now, what day we had! The markets opened sharply lower, then suddenly reversed direction, only to end up mixed. This occurred as the bumbling child king and his chorus of trained seals appeared in a spectacle called the "New Economy Summit". There was the "Coward in Chief" himself muttering such things as "I wasn't really saying that biotech companies could not patent genome research", Cheetah (Al G-span) tossing a few well placed bananas to the clueless crowd who watch with their eyes glazed over and mouths agape, and Abbey Jo saying that seven days ago she was just kidding and that now she's "enthusiastic about US stock prices". Gimme a break! This circus act was almost laughable. No! I am in error - it was laughable. Though I must admit that I personally find the whole event rather amusing (and entertaining). One would have to wonder how many rabbits this crowd can pull out of their collective *****. Crudele laid it all out it his article, and MK's market report says it all. Guess I'll sit on my Old/New Economy stocks for now and continue to add to my PMs (physical and paper), meanwhile I'll watch this amusing tragic comedy unfold.
Farfel, to add to your volatility argument: I recently heard of a mortgage company that would cut you a special deal if you couldn't come up with 10% down for your new home purchase. They would take your stock portfolio instead. So if you were buying a $150K home, all you need is a $15K portfolio to turn over to the mortgage co. The catch is that if the value of the stock dropped, you must cover the difference immediately. So imagine if that portfolio was leveraged at 50%. Suddenly you need some cash. If you had any cash to begin with you probably would have used it in the first place. So what do you do? Get a second mortgage at one of those 125% of your home's value, high-interest, late night TV mortgage houses. Oh yeah, and hope the stock doesn't drop any more.
And if there's any money left over, how about that IPO your buddy was touting?
Peter Asher: Margin in the Stock Market, Final Clarification
-----------------------
Peter, although today's investor is required by his stock broker to put up much more margin than in 1929, in
reality, based upon current American debt per capita figures (the highest in history) PLUS American savings per
capita figures (the lowest in history), then there has never been so much debt held by the investing public and so
little savings. In that sense, the average American investor is leveraged to the hilt.
So although brokerage houses force investors to put up more margin today, in fact, the average investor has never
had greater inclination nor an easier time getting a house mortgage (1st or 2nd), then using the proceeds for stock
market investment. Today's average investor has all variety of credit card options that were not available in 1929,
and he can obtain huge cash forwards/lines of credit that can be utilized also for stock market investment.
So although today's average investor may hold 50% margin at his friendly stock broker's office, if you include his
other forms of leveraging (primarily house mortgages and credit cards), then I would imagine that his aggregate
debt vs. aggregate net worth puts him not too far from the 1929 leverage factor of 90% debt against 10% deposit.
That is why Tuesday's little market event might be all that was needed to begin an amazing snowball effect leading
toward a climactic market crash.
If enough margin calls were issued on Monday & Tuesday, and assuming the market does not snap back immediately this
week, then conceivably hundreds of thousands of investors will be compelled to begin a deleveraging of their
lives. The margin calls might force all variety of real estate liquidations (as a result of mortgage borrowings used
for stock market investments), not to mention other forms of liquidiations to satisfy credit card companies
demanding repayment of advances utilized for stock market investment.
Although this de-leveraging will not occur overnight, its real effects might begin to show up in the stock market in
another month or so.
From my perspective, if aggregate debt levels held by American investors are as large as they appear...and if their
savings are in fact negative now...then in the absence of a quick stock market run up over the next few days, then
another huge round of forced stock market liquidation should show up as early as a month from now, but
probably not later than two months from now.
I guess what I'm saying is this: assuming the Consumer Bureau stats are correct, then Tuesday's drop was in fact
a stock market crash, with the great confirmation downspike looming in the next few months.
In effect, to draw an analogy that would make Ralph Acampora proud (after all, the man said the speed of modern technology dramatically shortens the duration of today's bull-bear markets): if Tuesday represents 1929, then the next drop this year will take the markets to the 1930's low.
a liberal media interpretation of the Battle of Lexington.
http;//www.freerepublic.com/I thought this was such a cool parody. How today's liberal media would view our Founding Fathers battle for freedom in Lexington in 1775.
********************************
Governor Condemns Extremists
BOSTON - National guard units seeking to confiscate a cache of recently banned assault weapons were ambushed on April 19th by elements of a paramilitary extremist faction.
Military and law enforcement sources estimate that 72 were killed and more than 200 injured before government forces were compelled to withdraw.
Speaking after the clash Massachusetts Governor Thomas Gage declared that the extremist faction, which was made up of local citizens, has links to the radical right-wing tax protest movement.
Gage blamed the extremists for recent incidents of vandalism directed against internal revenue offices. The governor, who described the group's organizers a "criminals," issued an executive order authorizing the summary arrest of any individual who has interfered with the government's efforts to secure law and order.
The military raid on the extremist arsenal followed wide-spread refusal by the local citizenry to turn over recently outlawed assault weapons. Gage issued a ban on military style assault weapons and ammunition earlier in the week. This decision followed a meeting in early this month between government and military leaders at which the governor authorized the forcible confiscation of illegal arms.
One government official, speaking on condition of anonymity, pointed out that "none of these people would have been killed had the extremists obeyed the law and turned over their weapons voluntarily." Government troops initially succeeded in confiscating a large supply of outlawed weapons and ammunition. However, troops attempting to seize arms and
ammunition in Lexington met with resistance from heavily armed extremists who had been tipped off regarding the government's plans.
During a tense standoff in Lexington's town park, National Guard Colonel Francis Smith, commander of the government operation, ordered the armed group to surrender and return to their homes. The impasse was broken by a single shot, which was reportedly fired by one of the right-wing extremists.
Eight civilians were killed in the ensuing exchange. Ironically, the local citizenry blamed government forces rather than the extremists for the civilian deaths. Before order could be restored, armed citizens from surrounding areas had descended upon the guard units. Colonel Smith, finding his forces overmatched by the armed mob, ordered a retreat.
Governor Gage has called upon citizens to support the state/national joint task force in its effort to restore law and order. The governor also demanded the surrender of those responsible for planning and leading the attack against the government troops. Samuel Adams, Paul Revere, and John Hancock, who have been identified as "ringleaders" of the extremist faction, remain at large.
Farfel (04/05/00; 22:53:17MDT - Msg ID:28169)
Peter Asher, I DISAGREE with your SM margin analysis..
Farfel, I don't think you really do.
Just last weekend in Peter Asher (03/27/00; 00:12:32MDT - Msg ID:27532) I said:
"When spending has been fueled by Debt, than that purchasing power has been spent indeed! A circular flow of debt service is created. Former producers now live on the Golf Course and sail their Yachts receiving interest payments from others who receive mortgage payments from others who draw CD interest from banks who receive car and appliance loan payments from consumers who have spent all their savings and earnings giving stock certificate sellers the funds to buy the production of all the workers who so far have had a market to produce for.
Now in theory, if the current balance of flows were to remain in stasis this could go on indefinitely. However the current flow cycle is based on the expectancy of change. The current rate of consumption is fueled by the unsustainable premise of more and more unearned wealth being acquired out of what is really Joe attaining Harry's savings. This infamous bubble creates larger and larger quantities of debt service as it goes. The laws of physics dictate that one cannot neither pull one's self up by one's boot-straps nor hoist a load on a "Skyhook." Once the "Expectancy" of the "Easy Money" (whether easy loan or easy gain) vanishes, the money machine will wind down and some one won't make a mortgage payment to a bond issuer who won't make an interest payment to a bank who also isn't getting an SUV loan payment and who now has to pay up to the Federal reserve window for the extra funds to offset the default.
Debt service will become the Emperor's suit of clothes that will unravel as the stitches start to pop."
What I was describing this afternoon was the CHAIN REACTION that took place because a small move in the price of the stocks triggered margin calls, and more specifically SELLOUTS which further depress prices, begetting more margin calls and sellouts. They don't have to give you time to put up more money when it's in free-fall! That is a major difference between then and now. What you are saying about overall debt, I have been saying here for a year and a half. That is also a major difference between then and now, on that we concur totally.
****
Solomon, thanks for the response. I'm tapped out tonight even though it's 'only'23:52 pacific time. I'll try to address the derivative situation tomorrow.
I heard something reported today I thought some would find interesting. Seems that one of the brokerage houses (Merrill Lynch, I think it was) has said that 90% of the margin calls they delivered this week prompted investors to deposit more cash into their accounts instead of selling. I guess there is still quite a bit of optimism out there. How long will it last if prices don't hold up?
http://www.usagold.comIn the beginning of WW2 the Swiss decided for safekeeping,
to send there entire Gold Schatz to the USA. I am trying to find out te exact quantity. At some point early in the war the US decided to confiscate this Gold. The term used for this action was more benign but the end effect was the same. This USA action forced the Swiss into dealing with the Germans on Gold in order to back the SFR with Gold to retain its purchasing power or starve slowly.
Interestingly during the entire war the USA never cofiscated
the Gold of Italy a war participant or France, a conquered nation.
To the Point of this.
Switzerland has made many requests since 1946 for the return
of this Gold.The Cheese-country populus is blissfully unaware of this. The response of the US has been negative all these Years. The US does not deny the ownership,nevertheless its return is still open. I wonder if this Gold sale by the Swiss is an attempt to force the issue by selling this very Gold on deposit with the USA.
The official gold stock of Switzerland aprox. 2400 tons does not contain Gold held as national defense, be it for weapons or food or economic-survival. The unofficial figure of Gold held is more like 7000 tons. Please exuse my poor English.
I am a little puzzled here re this confiscated gold. If the FED have not entertained the thought of the return of the gold to it's rightful owner, how does a sale help the Swiss? Do they tell the buyers to go and collect at Fort Knox? Or is it that the FED are just printing more $$s to handover for the Swiss. Please expand a little bit more.
http://www.investech.com/ The charts of the week over at Investech are becoming very interesting to watch. NASDAQ p/e ratio, intraday volatility, the gorilla index.
Date: Wed, 05 Apr 2000 15:07:35 +0100
From: "Karl W. Feilder" Subject: question: London Stock Exchange: A coincidence
To: "Year2000-Discuss@Year2000. Com" Reply-to: kwf@gmt-2000.com
Dear all,
Firstly - I have not fallen off the planet ..... but more of that another time.
You are certainly aware that NASDAQ is busy at the moment.
But did you know that trading on London Stock Exchange was suspended today .. because their computers have broken down (the media is being vague).
I just wondered if anyone else thought this was strange on the first trading day of April 2000, the first trading day of 2Q2000, and today is the last day of the UK fiscal year ??
Your thoughts ? Some facts ?
best regards
Karl
When in the dimmed past did the forces begin gathering momentum to bring us to the present environment of institutionalized lawbreaking in a Croney Overlord Network. I would say since Cival War. It has all lead to this crossroads of power and Empire thats become an etherial mindset whose "command", decisions are all sanctioned under a National Security State Mentality
This will be the Countries undoing. The disconnect from "the Good", that empowered the Country in the framework of the Founding Fathers will lead to the unfolding of George Washingtons "VISION", that he had of future events and usher in much tribulation upon the Country.
London--Apr 5--Ghanaian gold miner Ashanti's Chief Executive Sam Jonah said Wednesday that Ashanti had no immediate intention of reducing its hedging activities in the near future. (Story .19281)
Black Blade: Why? The last disaster was exciting and did wonders for shareholder value, why hell - let's do it again! I kind of suspected that ASL was only a penny stock anyway ;-)
I see several readers already responding to your challenge - good for you. I suggest that you might set up a site where people could register their commitment and support. Maybe USA GOLD would help you.
You have a winner of an idea. People need a point to rally around. Long live the 100 ounce club!
Sir 4Ducat- As the pranksters seem to be having a chuckle on you, it gives solice to know at least they're reading in detail, no? They should be so wise as to go back and read your excellent post on 3-24 #27440, "The Lull Before The Storm", and in the same vein the also outstanding thoughts by Simply Me, on 3-26 #27531, "The Powers Of Executive Orders".
Sir HI HAT's follow thru yesterday 4-5 #28143, "The Big Chill", put some icing on the cake; upside down though it may seem.
Each of these poignant thoughts reflect the Neville Chamberlain thinking of our time, and gives one rememberance of how history jumps back to bite us. Thinking of old Neville reminds me of Albright, the ultimate ox_moron.
I picked up 25 ounces of silver slivers last week, and will get right on my other 75 ASAP. Now, if I could just add three zeros onto that 75.
From: "Bill Stocking" Organization: Northbrook Consulting Group, Inc.
To: year2000-discuss@year2000.com
Date: Thu, 6 Apr 2000 00:18:24 -0005
Subject: Re: London Stock Exchange: A coincidence
Reply-to: wrs@firstbiz.com
Wow... so that was happening in London too!
Well, I didn't think anything of it at the time but on Monday in Chicago,
the first workday of this month, the computers in my local bank went down.
I tried to make an appointment at my medical clinic but couldn't do so because their computers were down also! I believe there were a few other networks in the Chicago area that went down on Monday as well -- too many perhaps for mere coincidence.
Bill Stocking
Principal
Northbrook Consulting Group, Inc
A licence to literally destroy and create more money?.BlackBlade. Hi friend, I have seen some siseable clumps of Gold on display in Perth over the years of which one was fist sise ( Crystal Gold ) Yes actual Crystals like trees wanting to grow out of itself. I am sure you know of them.
I have been working (hobby) on a verneuil inverted oxy-hydrogen blowpipe for the last couple of years and in order to make synthetic sapphires and rubies I must (long story).........................heat the very pure right micronage alumina or Al2O3 or Aluminium rust to X and through its cooling on a pedistal, i.e implosion thereby employing the necessary pressures required for corrundum crystals to form. etc etc etc etc ... stop dribbling Ray !.
Anyway I am assuming that these crystals must be made from AuO or Gold Oxide or Gold rust and that that rust should have to be in an incredibly pure form before compression or heated and implosion/cooling in an environment satisfactory as in the case of near all gems using the oxides of metals to meet that same end. Do you know if I am right Black Blade
?, is that how nature does it? , the only difference being the furnace chamber is the immm what do we call it ground
wise ..... Skull Melting ?
Because good nugget crystals (if one could call them that) are almost obscenely priceless. How do we know when we do see them that they have not been hand made somehow like this or indeed been through some form of electolisis ?. Oxidation in essence just applied heat apon the host, right electron tranfer rarara . Do you know a method to speed that right up for gold Black Blade?.
Synthetic gems leave spectum-wise tell tale fingerprints.
I am as curious as all hell if these gold crystals would ?.
Can this fool brain-storm ?. Assuming that indeed it is AuO
nature uses and it can be "the rust" homemade, once the raw material is acquired a few carbon rods shoved in a suitable refactory powder with the AuO at its centre might work huh , with the amps in short screaming there brain out and then gently wound back at a controlled rate to cool implode or create the right pressures concommitant with the process?.
Regards.
Today's Gold Report: Election Year Finance: Deja Vu All Over Again
The server will not allow me to post the Daily Market Report today. It appears here only. Sorry for the inconvenience.
Market Report (4/6/00): Gold was down in the early going with the downside being blamed on fund selling in London.
The markets are still trying to find their way after Tuesday's rocket ride. A large segment of the investing public loves the fact that the government, Merrill Lynch and Goldman Sachs bailed out the stock market, another more attuned group is beginning to mull the long term consequences of such action. It will be interesting to see what some of our top economists are going to say about all this. The left wing government interventionist types will applaud it; the free-marketeers will see it as dangerous tampering with elemental forces. Those that applaud it now may not understand that in the longer run, it could mean much deeper economic consequences far beyond a healthy portfolio adjustment.
If the intent of the market-riggers was to help the Clintonites for the 2000 elections, then we can expect a major, make that MAJOR, correction after the election is over. One is reminded of what occurred after the 1968, 1972, and 1976 elections. In each instance, the profligacy of the pre-election soft monetary policy (pump priming as we used to call it) led to highly inflationary economies right after the elections.
In the 1980s and 1990s inflationary episodes did not follow pre-election prime-pumping for two good reasons: One, the money printing wasn't as pervasive as it is today. Second, the oil producers (and Japan) were willing in essence to absorb our inflation rate and compensate with investments in our equity markets. Well, that's all changed. Then the markets were undervalued. Now they are overvalued in the extreme and Tuesday's bailout had to be the result of concerns that the foreign selling could turn into an avalanche. And as we all know the oil producers have taken it on themselves to run the oil price up and it now stands 250% higher than it was a year ago.
Alan Greenspan alluded to these concerns yesterday when he cautioned that the trade deficits could become a liability if foreigners abandoned our equity markets. "The significant uncertainties," warned the Fed chairman, "surrounding new economic forces counsel prudence." We concur. If this monetary build-up and the bail-outs continue, and we can indeed look forward to a major post election hyper-inflationary surge, 2000 might be a good year to accumulate gold, just as 1970 proved to be a good year to accumulate gold. In 1971 the United States initiated a series of formal devaluations that sent the American economy, and the equity markets, into a major, make that MAJOR tailspin -- a tailspin from which they did not recover for nearly a decade and a half.
That's it for today, fellow goldmeisters. See you here tomorrow.
That is because I am winning a nice bet I made with a relative about the market performance today.
You see, it does not take technical analysis or any unusually keen perception to predict the performance of the market today or tomorrow. At least, that is true once you come to grips with the true nature of todays American government and the manner in which it manages today's stock market, the engine of the economy.
With the Clinton goverment set to release unemployment stats tomorrow, then the usual pattern re-establishes itself.
These monthly stats always meet or surpass expectations, that has been the clearly established trend with this government's economic statistics. The only possible surprises occur on the upside, NEVER on the downside. Even on the 1% occasions where an obvious downside surprise occurs, then the Clinton spin machine goes into full blast, immediately creating a positive perception on a clear cut negative.
That is because both the US economy and the stock market today are MANAGED by this government and Wall Street, in a close approximation of the type of management practised by (former) communist regimes or the Japanese government of the Eighties. It is an illusion that we have a free capitalist system anymore. In fact, since most Americans (60%) now hold mutual funds and often the same packages of index stocks, then it is even an illusion that investing Americans are becoming wealthier. That is because if all "personal wealth boats" are rising at roughly the same pace, then everybody is actually standing still on a relative wealth basis.
Simply by extrapolation of historical trend, it is easy to state categorically that unemployments stats tomorrow will be positive, hence the usual pre-release maniacal run-up today, with yet another positive upside explosion tomorrow.
Moreover, it is imperative for Wall Street and the Clintonians to run the stock market up for the next few days, otherwise (see my previous post today) the negative multiplier effect resulting from the margin calls of Monday and Tuesday might not be neutralized in time. If not neutralized, then a much bigger crash would loom sometime down the road, maybe in another month or sometime later.
Meanwhile, once again, I advise forum members to avoid taking any contrarian bets on these markets. It is an exercise in futility. Since walking away from these chronically manipulated markets, I have experienced personally a much greater sense of inner calm.
The other compelling reason for forum members to stop their contrarian bets on this market is this:
If the short sellers exit the market, then it can only rise on the back of new funds inflows, instead of short covering.
Well, it would be interesting to see how much longer market verticality can sustain itself in the absence of short covering. After all, new funds inflows cannot increase at a near exponential pace forever.
Well All, I am going to the farm for the weekend in the morning so I will see you in a few days unless someone wants to fly over and do post and rail fenceing hehe. What a fantastic week its been sharing, listening, and lurking with you colourful personalities. Re: 1927 - 1929 . I am unsure still, I really do hope that AG has learnt something.
Mr Solomon Weaver. Actually I said that tongue in cheek re:
sneaky shifty etc really. I know its the acts of the land that cause half the encumberances not the people, I just wish some of these seemly power merchants would use there discretionary powers more when the need arises. No-one, thing, authority whatever will ever be able to stoop low enough to get me to hate them, even the collusion crowd.
There was abit more to that yarn dear Sir , anyway its a humble plot , up in the hills , plenty of stars at night , Kookaburra's , red and white tailed black cockatoo's,
Kangaroos, but no deer here. Hope you get the scheme on!:).
Black Blade . Eureka ! Found rust ! Gold Oxide (111), Au2O3
False Mr 4Ducat. Ironhead may have just given you the wisest advice yet my friend. Hand the handle back, come in, listen, and learn with us. Regards All.
I should say again, that last night's post about the 100 oz buys from COMEX was not my post.
I just emailed rhody, a poster on the Kitco forum with some thoughts on recent market events and thought they could also be shared on this forum....
(snip)************(splat)
I know you are thinking of persuing another good K weight gold ******* on eBay, bro, and it really looks like a good piece, but keep in mind what happened on Tuesday. It is now April and also the earliest time projection for the silver market to blow up! Think about 1) the stock market collapsing this month and/or 2) the metals taking off. Think of the potential affect on eBay both on the company and the seller participants. So here I go on Sunday and buy 40 oz from a bullion dealer. You in turn are bidding on an expensive ******* (and bullion, also), but how stable the transactions if all of a sudden, with your money on the way, silver or gold explodes for $10 to $20 respectively? Can you say default?
So an added worry until my bullion arrives(?). I will not do this again.
You might want to read USAGOLD for yesterday and today. There was quite the reaction to that repost I put on. Note, however, that the "plan" revealed is not that profound. All he is really saying is to buy physical and take delivery. This is not rocket science or any different in concept from what we have been doing and recommending in recent years. Whether one does it on Comex, or elsewhere, it amounts to the same thing on the supply end. The advantage to doing it on Comex is that G.S. et al has to react more directly to the pressure. But how many are in a position to interact directly with COMEX - as opposed to doing it by their habitual route? I made a comment about some of this to Solomon Weaver when he thought I was responsible for last nights post.
>>> Despite the traditionally heavy summer driving season, gasoline
prices should decline steadily between May and September, falling
to a national average of $1.39 cents after Labor Day, the agency
said in a revised short-term forecast.
The report was in sharp contrast to a forecast a month ago when the
agency said that even with increased oil production, gasoline prices
were expected to soar to a national average of as much as $1.80 a
gallon and likely reach $2 a gallon in some places by July. <<<<
http://www.usagold.comYou can use my name, but can you think up the wild inferences I come up with? What is the market going to do brainchild-1? Ver ist di cerebral content??? Let's make a deal...................you can be 4Ducat from now on and I'll sign up as some one else. When your posts sound as ludicrously truthful as mine then you will have pulled it off. Until then your the one still standing on your head wiggling your toes and your economic analysis nobody knows. Is this live or memorex?
Good timing for this repost from Kitco....Ted Butler
And I doubt that Ted is overstating with his $100/oz estimate. He is just factoring in inflation and the dollar value for the 1981 silver explosion.
*********(snip)*************(splat***
Date: Thu Apr 06 2000 12:45
ted butler (Mooney@silver) ID#370209:
Copyright � 2000 ted butler/Kitco Inc. All rights reserved
Thanks for the post. You are half right about the silver manipulation. You won't get much argument from me on leasing's effect on the market, for obvious reasons. But, I think you underestimate the COMEX crooks' effect on the market. Let me restate the premise - in no other futures market, does the paper tail wag the real market dog like in silver. No other market. I'm sure you read my allegations of manipulation on the COMEX, that on 2/11, four or less traders were short one-third total annual world production. No other exchange would ever permit such a travesty. Not the Chicago Board of Trade, not the Chicago Merc, not any exchange. You read the NYMEX non-response. The CFTC is still hiding under their desks. It's been over six weeks, and those wimps can't respond.
If you allow the paper market to become bigger than the cash market, in violation of every principle of commodity law, the paper market will dictate price. The bigger market always does. That is what has happened in silver. It has not happened in any other market. It's really simple. Of course, if anyone could point out another market where the paper dwarfs the real market, then I'm wrong. But please, no LBMA crap, bona-fide numbers only. You might want to think of it this way. Paper contracts are derivatives. They are derived from the cash market. It is unnatural for a derivative to be larger than the underlying host market. That unnatural situation exists in COMEX silver and COMEX silver alone. Why? Silver's not the most manipulated market in the world for nothing. If the COMEX closed tomorrow, we would have $100 silver tomorrow.
I am pleased to finally see mainstream acknowledgment and agreement to the view of (Peter Asher (05/22/99; 16:29:17MDT - Msg ID:6620)
>>>> Much of what you (Julia (05/22/99; 15:53:07MDT - Msg ID:6619) ) posted about the goodness and heroics of those faced with a nightmare come to life is valid, however there is more afoot here then just the evil of two students. This very school was a few years back, the subject of an expose' on 'death education'. This macabre trend, part of the 'values neutral' conspiracy,(I am explicitly choosing that word in this case), along with the TV and Hollywood profiteering on violence fantasies, has created an apathy toward death among young people, for their own lives as well as the lives of others. <<<<
Bravo Patti Johnson
(And what a lame, juvenile rebuttal from the District spokesman)
Columbine caused by curriculum., board member charges
By BILL SCANLON
Scripps Howard News Service
April 06, 2000
DENVER - The Columbine High tragedy was caused in part by
a curriculum that overemphasizes death and doesn't teach
right from wrong, a Colorado state school board member said
in a recent speech.
"When all the kids' videos are about violence or sex, when
kids are allowed and even encouraged to make such videos,
what do you think is going to happen with some of these
kids?" board member Patti Johnson said Wednesday,
amplifying remarks she made in Cincinnati last week.
Her speech in Ohio was titled "The Real Killers at Columbine:
A Curricula Gone Bad."
Johnson said Colorado schools have too many teachers who
encourage students to question the values taught at home
and who push them to talk about death.
A spokesman for Jefferson County Schools disagreed. "The
bigger story is why a state board member is talking about
something she has no knowledge of," Rick Kaufman said.
"Patti joins a list of people across the country who are
exploiting the tragedy to their own personal or professional
gain," he said. "They talk about why they think the shooting
occurred, what motivated Eric and Dylan to do that, basing it
on what they read in the media."
Johnson is no stranger to controversy. She was the catalyst
last year behind a state board of education proclamation
that Ritalin and other prescription drugs shouldn't be used to
treat schoolchildren.
She said the drugs Eric Harris was taking before April 20 may
have played a part in the rage he and Dylan Klebold worked
up to commit the act.
Johnson also said discussions about suicide and death didn't
by themselves cause Harris and Klebold to kill 12 classmates
and a teacher before killing themselves.
But she said schools that don't teach absolutes of right and
wrong, that stress relative truths and that encourage
students to find their own values are playing a dangerous
game.
"To Harris and Klebold, their decision was a rational one,"
she said.
Johnson points to a lifeboat scenario popular in some
classrooms, in which six or seven students decide which life
is most expendable _ the disabled person, the rich man, the
healthy doctor, the pregnant woman.
"Eric Harris and Dylan Klebold did their own lifeboat
scenario," Johnson said. "They didn't like blacks, jocks or
Christians."
Johnson says teachers shouldn't put students into a position
to weigh the relative value of human life, because to her all
life is sacred. She maintains that when a suicide survivor
gives a talk, some students who never would contemplate
suicide become obsessed about it.
Kaufman said Johnson's contention isn't backed up by
research.
"Certainly, discussions on death and suicide may be
appropriate in some venues," Kaufman said. "Particularly
because teen suicide is a topic of concern of educators and
students. From a prevention standpoint, discussion can help
people understand, absolutely."
Johnson puts part of the blame on cultural diversity units,
which she says too often are so negative that students
emerge distrustful.
"They say all this dirt was done to this group in the past _it
was always the white man who was evil," she said. "They
never point out how many people died trying to free the
slaves. They create more division and create more hate and
anger."
Kaufman said Johnson doesn't know enough about
Columbine to speak with authority about it.
"She was not at Columbine, she was not a part of curriculum
development," Kaufman said.
(Contact Bill Scanlon of the Denver Rocky Mountain News at
http://www.denver-rmn.com.)
>>> It is unnatural for a derivative to be larger than the
underlying host market.<<<
Very good point! But then the derivatives are only betting slips really. It is the assumption that the derivative market is creditworthy, that allows it to dictate price. That is perhaps the most unnatural aspect of all.
http://www.westegg.com/inflation/I know that my private little revelation about the real value of money according to the CPI didn't generate a lot of discussion....especially since it wasn't as clear as I wanted it to be, but Im still in shock over INFLATION! Here is a great tool...plug in whatever values you want. Here is some values that really shocked me. $1000 in 1986 is $1501 today. Think about it. Try the year 1973...$1000 in 1973 is worth $3871 today.
DOW repeats Mid-Jan Top Pattern? Look, Leap or Cry
http://usagold.comI think Warren Buffet has to lease silver for the same reason Microsoft wants to keep Apple Computers alive.....to give himself an alibi in case he is accused of running a monopoly.
We've seen some heavy selling of gold in NY after the open for the past three days. Interesting how the market is absorbing this selling so well. Who in their right mind would be shorting gold below 280? Probably this is the bottom and it's going into accumulation. Farfel said it how most investors already sold off their goldstocks for margin call fodder. I think buying gold is far from the average investor's mind. People evaluate the retracement based on last month's levels. Who is going to look at the 2 yr chart and draw the right line? Only the professionals. The amateur traders are setting themselves up for the same minicrash of a few days ago. The real test is if prices stair-step up and hold or does the Nasdaq spike up and selloff to the same base level. If we get a few days of rally failure with spikes selling off, with high upper shadow candles then it's headed down some more and the shorts will get very aggressive. The last bear-scare of last Oct., Schwab brokerage was down for three mornings, so nice of them to unplug everything to keep their clients from selling into the down market, smart actually. But it will happen next time too. Last time my internet connection went down in a nasty down day they told me a main Sprint cable was cut somewhere in Tenessee. Unplugging online traders enmasse seems to be an outlet for big investment house frustration. What should you do? Take every opportunity of the small rallies to unload stocks. Even if the market rallies, don't you think the big boys will be selling into it heavily? For this market to breakout into a new horizon it has to find buyers to absorb all the selling that will occur from people wanting out but affraid to sell now and take such a loss. Time going sideways is slow death at this point, because there is a pent up frustration of bulls underwater wanting to get out. People want it to go up to a higher level and baseout absorbing all the selling and then you have a stable Nasdaq. It can't happen easily. If it doesn't do that then a continued panic will ensue and we go into distress selling. Margin call round II until the pessimists rule and we start the serious decline. It may not do the 1000 pt 2 day DOW drop or the 800 pt Nasdaq plunge. What is the difference if it falls another 25% in a week or in 3 days? A bear market is food for goldbugs. Any slow buying on any stock will produce a high handle that is subject to a fast break way down. What you want to see are morning rallies and the price going flat all afternoon long. If you don't see that then get out while you still have a connection. Prices will not hold at these high levels unless real enthusiasm enters. But I have quality stocks??? Sure we have thousands of perfectly viable companies that will be dragged down from margin call selling as the junk really sinks. Then sucker's rallies lift them halfway back up then the next round of distress selling occurs and they go down again. Each successive rally is less than the last one so people are always trying to get out and there is a sad lack of buying. Lofty earnings projections are the norm in an overheated market such as this. So what happens when they do a Proctor & Gamble and miss numbers? They get killed.
No momentum?........that means no happiness for momentum investors who were used to buying into the rallies. They are becoming bottom fishers. Bottom fishers get impatient waiting for the fluke to bite. Pull up anchor, we're moving to a new location. They keep buying in and going underwater and selling and buying in and slowly moving to the Warren Buffet model a search for value.........after they realize the only value is in things real, commodities, then gold will have done its spike. Gold is the king of commodities. Looking at the charts though, silver seems to be more of a leader.
We generally believe that gold can always be manipulated down. This is not true. There is no way after gold becomes popular to short it back down. It will do a Palladium before they put price controls on it. It takes years of fighting gold to get it down so low. Low POG can only be kept down by having something else in the spotlight. Last liquidity crisis of '98 we saw stocks fall the same way. Biotech was last to rally and first to fall. WHAT is in the spotlight to draw investors in and give them security??? Nothing I see. Last week we saw a rally in natural gas and propane stocks. That's your equities agenda??? Oil exploration and gas utilities. WOW, a 1/4 pt gain every three days with a gas utility or throw your money at Jed Clampet with the shotgun for oil exploration. No I'll bottomfish at the goldbin. In gold I have very low risk with the opportunity to make 50% in like three days. I've got inversive volatility with a negative beta. Have a great day in gold. 68534e763
How do we encourage a million investors to buy some silver?
We should not be preaching to the choir. We need to get the idea of buying physical silver into the mainstream.
We need to plant articles in some obscure newspaper about silver investing. Then get //www.worldnetdaily.com and //www.drudgereport.com, etc. etc. pick it up.
Lets use the power of the web to get this out in the open.
By the way, I know some sources of silver that would get wiped out with just a few dozen buyers. How to we get enough silver to meet the intended demand?
The Fed holds a "custodial" gold vault that has seen its content fall over the last two decades from 18000 tons to about 10000 tons (if memory serves right).
I have suspected that the US has been holding this gold "hostage" and releasing it slowly when they have to. This was, supposedly, the gold that was used in NYC for international bank settlements. Once the UK had lost all of its little remaining gold, there only remained Swiss gold and gold from the Axis nations and the conquered nations. This gold was "interned" for use as part of the dollar settlement system established at Bretton Woods. The Marshal plan was (in part) traded for silence on the issue of the return of this gold, so far as I can tell.
The gold is most probably being sold into the markets, as it had in the past, and repurchased by its original owners. The owners get a credit with the Federal Reserve who then buy treasuries from the bond markets for the gold seller's account. It seems that the only way to get your gold back is by buying it again. Super power as super thief and extortionist.
For the above you will find no official documentation. There were some grumblings 20+ years ago, but silence is the norm.
http://biz.yahoo.com/rf/000406/cj.htmlOn the eve of the election in Greece, this from a Reuters article setting the stage for what is on the voters' minds:
"A wild card is the stock market, which boomed last year amid much government glee, then turned tail sharply, leaving many unsophisticated small investors claiming they had been duped."
Peter, do you have contact info for Patti Johnson? I'm in total agreement. Of course, not being a politician during an election year, she can speak the truth. Anyone running for office wouldn't dare blame it on anything but those bad old guns. They say it's good for capturing the female vote. You ladies can comment on that if you wish. OC
"As you know, the current economic expansion is now the longest in our nation's history. ... Having said that, it is important to be mindful that now is the most important time for realism, prudence, and vigilance by both policymakers and the public at large. We should be mindful that generally good economic times can soften the impact of--and often mask totally--poor judgments. Eventually, however, those judgments will have detrimental consequences. Let me focus on three areas of realism that are required in this time of historic opportunity: the financial sector, individual decisions, and the international sphere."
1) Realism in the Financial Sector
"As you know, at the end of last year, the Congress passed and the President signed into law a bill to modernize the financial industry of the United States. This law, the Gramm-Leach-Bliley Act, presents opportunities and challenges for the financial sector, which must be approached realistically and prudently. The most obvious opportunity for the financial sector now is one of ongoing consolidation and broadening--consolidation largely in continuing response to the end of legal constraints on geographical operations and broadening as financial institutions take advantage of the opportunities to expand lines of business offered by the act. The consolidation movement among banking organizations, of course, predates the passage of the most recent financial modernization law. In fact, it is reasonable to believe that the forces for consolidation and broadening were so strong that they provided an impetus for the repeal of Glass-Steagall, following a generation of effort not only by the Congress but also by financial institutions and regulators."
"The extent of consolidation and broadening remains in question, however, which gives rise to the second opportunity: the opportunity to deepen specialization. ... Another opportunity open to the financial sector is the continuation of the impressive trend toward globalization and international consolidation. ... Also, the emergence of the euro as a successful global currency, with the payments infrastructure, unified monetary policy, and converging fiscal policies that are associated with it, creates an attractive, large market. This is a market that U.S. firms have found, and will continue to find, hospitable and in which European cross-border mergers will, no doubt, continue. And, of course, the deepening of technology capabilities in most financial institutions means that management on a global scale, particularly risk management, is now feasible as well as necessary.
This dynamic presents many challenges. ... While in general the early experience in large, cross-industry consolidation appears to be successful, we have not yet had the test of a slowing economy. Until we have gone through a full business cycle, it is hard to know how strong the business case for integration truly is."
[Take not of this paragraph...]
"Second, we must be cautious in assuming that more-diversified and larger firms are inherently less risky. One of the ongoing challenges in the emerging world of high-tech finance is risk management. The experiences of the last two-and-one-half years indicate that the speed of market movements, combined with the scale of financial endeavor, can lead to a rapid reversal of fortune for even the most sophisticated market participants. Models are inherently backward-looking, and even the best of them have not proven to be foolproof in sounding the alarm for newer risks. There is evidence that banking organizations, and probably financial institutions more generally, will use the benefits gained from diversification to increase the risk in the individual components of their portfolios. Indeed, some activities now permissible in financial organizations, such as merchant banking, have high average returns, but those returns mask a wide variance in result, with some outcomes quite detrimental to profits and potentially to organizational vitality."
"I hope that bank managers are keenly aware of the risk profiles of their companies and are not inclined to take additional risks to hit earnings targets. Banks are clearly trying to diversify their earnings streams. They will need to monitor carefully the performance of newer products developed and marketed during the 1990s in response to broad consumer needs. While we have enjoyed record expansion, the prospects for a business and an economic downturn must be factored into pricing decisions. Credit and underwriting decisions should take into account realistic downside sensitivity analysis."
[Take note of section 2 in its entirety...]
2) Prudence in Individual Investment and Borrowing Decisions
"However, financial institutions are not the only economic actors who need to maintain realistic expectations and to exercise prudence and caution during this period. Individuals must exercise ongoing vigilance in their personal financial behavior. In particular, individuals should recognize that in this era of technology-induced growth, high growth goes hand in hand with high uncertainty and, for newer companies, volatility in their financial performance. This means that accurately valuing a company in the high-growth industries is dauntingly complex. Therefore, individual investors are best advised to consider a range of scenarios, including not just the rosy outcome of possible success but also the very real one of potential failure. History clearly demonstrates that for every successful start-up the vast majority find success elusive.
"Individuals would also be well advised to consider a range of personal financial scenarios. Perhaps based on expectations of solid income growth, which we all hope will be borne out, households have increased their debt faster than their disposable personal income in every quarter over the past five years. Despite increased borrowing, however, the household debt service burden, as conventionally measured to include consumer and mortgage debt, remains below the levels reached in the 1980s. This burden has been held down in recent years by falling interest rates and a shift toward longer maturity mortgage debt. Nonetheless, even in good economic times it is prudent for households to be prepared for a range of outcomes, not just the most optimistic ones."
3) Caution in the Global Economy
"While being cautious, let me not convey a pessimistic tone, because I believe that the four major forces currently driving the domestic economy could well provide the underpinning for a new era of prosperity in the global economy. ... [a)] technology ... [b)] business deregulation ... [c)] more prudent fiscal policy ... [and d)] The final major change was the reduction of both actual inflation and the expectation of inflation as a necessary component of personal and business decisionmaking. This trend began during the early 1980s, and it has reached the point of fruition only in the past few years. Relatively stable prices have allowed businesses and households to plan their economic affairs with a general expectation that the value of investments will not be eroded through a pernicious increase in the general price level. Indeed, price level stability has reinforced the impetus provided by deregulation for businesses to manage their affairs with a priority on efficiency. These developments are not unique to the United States."
"Additionally, much of the industrialized world has governments following a path of smaller deficits and eventually smaller debt. The 1992 Maastricht Treaty, laying the groundwork for the unification of much of Europe into a single market with its own currency--the euro--is the most obvious but not the only example of this trend. Finally, the emerging consensus among politicians, policymakers, and the general public in many nations is that any benefits of inflation are at best ephemeral and that inflation ultimately is highly destructive."
"However, achieving sustained global growth requires certain improvements. ... a global economy built around higher levels of technology and greater competition in markets for goods, services, and labor input will nevertheless also include persons or regions who by fortune or skill are not fully prepared to participate in a world economy."
Conclusion
"In concluding, let me reiterate that the prosperity now experienced by the United States, and potentially to be shared by the rest of the world, is certainly a welcome development. It is clearly the goal of the Federal Reserve to follow policies that will help extend this prosperity for as long as possible. However, it is also important for the financial sector and other members of the private sector here in the United States, and for market participants, banks, and regulators in other countries, to remain vigilant if this expansion is to continue here and to spread globally. We are in the midst of a period of enormous opportunity, one that can be extended and strengthened if we are realistic, remaining mindful of our obligations to act responsibly, both individually and collectively.
+
***"In this context, for managers in the financial sector acting responsibly includes recognizing that not all financial institutions can successfully consolidate or profitably take advantage of every new power. For individuals, personal financial decisions--both investment and borrowing--should take into consideration the possibility that the most optimistic expectations of corporate or personal financial success might not come true."***
Market manipulation is merely the logical extension of Keynesian (pseudo) economics, which is itself the self-justifying rationalisation of the current monetary system that cannot be rationalised because it is a structure lacking a meaningful foundation (to wit, gold). This administration and its central bank behave with all Keynesian proclivities intact.
Keynesians manipulate the money supply, not for reasons of economic fundamentals, but for aligning "perceptions" that will "cause" people to save, borrow, invest, and/or spend. Likewise, the markets now get the same treatment for much the same reasons. Under Keynes, no real mention is ever made as to why people decided (or were driven) to cease saving, borrowing, investing, or spending. That's because these normal, economically rational activities are abandoned because of the previous cycle of central bank boom/bust and Keynesian manipulations.
Keynesians are money supply and market managers, or, more directly "economic planners". Socialists, too, are (famously ineffective) "economic planners", never minding the fact that the no economy can be adequately "planned" in any sense of the word. Therefore, Keynsians are Socialists. In fact, the entire global monetary system (at least since 1973) is Socialist. In fact, plank #5 of the ten planks of Marx's Communist Manifesto explicitly calls for a central bank in order to achieve the desired "ends":
"5. Centralization of credit in the hands of the State, by means of a national bank with state capital and an exclusive monopoly." Karl Marx
This describes every central bank on the planet. And since, under Global Socialism, the State must create credit and "capital" on demand, gold must go and stay gone.
Forget all this baloney about the triumph of Global Capitalism. The Socialists won -- the proof is all around us in the many manipulations in many markets becoming more and more apparent with each passing day. And the derivatives contract is the New-Socialists� Magic Elixir. Unfortunately, sadly, and much to the oblivion of most participants, the result of every Socialist "victory" is the total destruction of the very object of their ministrations.
a response from RHODY - perhaps of interest to the forum
It's an interesting email, and I don't think he will mind me sharing it. I will also continue to pester him to join the discussion in a less vicarious fashion.
********(snip)*************(splat)***
Dear Bro:
I am aware that there is a possibility that gold could explode, but I think not for a while yet. I am now thinking that it will be another long cold summer for gold bugs, as the CABAL seems to have infinite resources to hammer gold back down under 290. They are not using leased gold to do it either. So someone out there in the official sector has very deep pockets and a willingness to sell. This must be the US Treasury. With a 2500 tonne deficit, they can sell for the next 3 years to maintain the buying power of the USD. Three years of using the national gold reserve to finance a fiscal deficit of 300 billion per year means they yield $3730 per oz for their sold off gold assuming they sell 7500 tonnes of their total 8300 tonnes. If you think of it this way, that they are buying time with their gold, and hence are able to finance the 300 billion current account deficit in exchange for holding down gold, then the return benefit to Americans is still almost $4000 per oz. This implies that this may be the upper limit of any gold spike.
So I don't think near term that gold will spike, and that in the next two weeks it will be safe to buy a gold articles on eBay. The PPT held the market last Tues, and that means they can do it again, and again, and that means that this market will go into a slow grinding bear similar to the 1970's and that means we still have a few months until inflation really destabilizes the gold market. It took years after 1971 for gold to peak out, and it will this time. A slow, grinding bear (stagflation) is the best environment for gold. I further think that just as solid gold pens and pencils are becoming extremely collectible now, so will other collectibles. The parallels are striking, yet the market has not picked up that much.
If a silver pencil with 50c worth of silver brings several hundred dollars on the collectors market, and a gold pen, several thousand, how much will a gold pendent, for example, with one oz of gold in it bring, with gold at $2000 per oz? Even the little gold filled items will be quite valuable. Yeah, the eBay sellers could default in a spike, but dead cat bounces have been so common over the past three years, why would a seller react by defaulting? My biggest worry is going into the eBay doldrums of the summer, and seeing all this cheap gold going for peanuts, and not having any cash to buy, because I do think this bear will hold into the fall.
October crash anyone?
rhody...
**************************
Perhaps someday he will move away from all those daytrader types over on Kitco.
Gun Control Has Proven Record of Effectiveness
Reader commentary by John J. McNight of Weaverville, NC
In 1929, the Soviet Union established gun control From 1929 to 1953, approximately 20 million dissidents, unable to defend themselves,
were rounded up and exterminated.
In 1911, Turkey established gun control. From 1915 to 1917, 1.5 million Armenians, unable to defend themselves, were rounded up and
exterminated.
In 1928, Germany established gun control. From 1939 to 1945, 13 million Jews, gypsies, homosexuals, the mentally ill, and others, who
were unable to defend themselves, were rounded up and exterminated.
In 1935, China established gun control. From 1948 to 1952, 20 million political dissidents were unable to defend themselves and were
rounded up and exterminated.
In 1964, Guatemala established gun control. From 1964 to 1981, 100,000 Mayan Indians, unable to defend themselves, were rounded up
and exterminated.
In 1970, Uganda established gun control. From 1971 to 1979, 300,000 Christians, unable to defend themselves, were rounded up and
exterminated.
In 1956, Cambodia established gun control. From 1975 to 1977, one million "educated" people, unable to defend themselves, were
rounded up and exterminated.
That places total victims who lost their lives because of gun control at approximately 56 million in the last century. Since we should learn
from the mistakes of history, the next time someone talks in favor of gun control, find out which group of citizens they wish to have
exterminated.
Believe it that everybody here is taking a hard look at the inflation theme your putting on the table. Inflation watching is a tricky business as cost of some items keep levitating while others do not.
\
Trail Guide has noted that serious inflation in the last couple of years has found an outlet in stratospheric stock evaluations. The other side of the coin is the sad, sad prices recieved for raw farm products, and mining as well, that are the same or in some cases even less than before WW2 Wages themselves have stagnated for well over 20 years. I tell you one thing I have definetly seen a real up move in grocery items in the last 90 days. Once the dollar really starts going south, with as much imports that this country MUST take in, we are going to have a wild ride up in prices of about everything and mass psychology is going to go into a 1970's mode.Markets always anticipate, so gold and silver should start swinging for the fences when the dollar breaks.
Steve, I know it was a century earlier, but I would like to mention the indian removal act of 1829 for those who don't believe that our fine goverment could ever be capable of such exterminations. What do you suppose Colonel Custer was famous for after the civil war? OC
Why in hell are you being hard on yourself. I think the statistic is that only one person in a thousand is recognizing the wealth value and accumulating gold. You are among the intelligent elite. Stand up and move to the head of the CLASS.
I am pleased to be with you today to discuss the new world that bankers and bank supervisors alike face in the wake of historic financial reform and continuing technological and financial innovation. Clearly, these are exciting, heady times. ... Simply put, most people in our country have never had it so good. And yet even as we celebrate our good fortune, we must bear in mind that this very prosperity exposes the seemingly unstoppable U.S. economy to certain very real risks.
Today I would like to discuss the important issue of maintaining sound lending practices at this critical juncture in the extraordinary economic cycle we are enjoying. I'll also ... conclude with an update on the effort to revise the Basel Capital Accord.
Our prosperity is the envy of the world, and our economic model is acknowledged everywhere to be one that works. It's not perfect, nor is it applicable in every detail to countries with different histories, cultures and values. Still, it is clear that in the longer run the market is better at allocating scarce resources than any version of a command economy.
Without an effectively functioning banking system for encouraging, collecting and deploying society's savings in a fair and impartial way into productive investments, there would be little hope for our economy, or any other, to mobilize the real resources necessary for economic growth and stability.
+
With this in mind, one of my major concerns going forward is the quality of bank lending. Banks are now at a critical phase in the credit cycle. After years of high quarterly profits, low delinquency rates and comfortable capital ratios, it is easy to forget the fundamentals of sound lending. And, as any good coach will tell you, it's the fundamentals, the basics, that make or break your performance.
+
The most important of the fundamentals is maintaining rigorous credit standards, especially in an environment of increased competition for new and existing customers. Experience teaches us that the worst loans are often made in the best of times. And because things are awfully good at the moment, I can't help but remind bankers and supervisors alike that the sun doesn't always shine so brightly. Indeed, sometimes it even rains. To paraphrase Mark Twain, reports of the business cycle's demise are greatly exaggerated.
+
In circumstances this favorable, loan officers must make doubly certain that there is every reason to believe that the loans they make are collectible. This is especially important for younger bankers who, given the length of this expansion, have never experienced a serious recession and may mistakenly view current conditions as ordinary rather than as exceptional. Lending granted on that erroneous basis would have grave consequences for the industry's ability to weather weaker economic conditions which are, to be sure, inevitable.
+
From a supervisory perspective, I believe it is time for us to exercise an extra measure of caution.
...one of several significant challenges banks currently face ... is that the spectacular rise in equity values and mutual funds has put competitive pressure on the core deposit base. As these lower-cost funds have been replaced with funding from the capital markets, principally commercial paper, pressures on interest margins and liquidity have intensified. Such funding shifts raise the important risk-management questions of how well institutions will function under stressful conditions, and whether enough has been done to maintain adequate liquidity. The decline in stable core deposits has also been coupled with a steady rise in average loan maturities, indicating a growing exposure to liquidity and interest rate risk.
[TownCrier note: with that having been said, it seems appropriate to interject some related material so you will better understand what he is talking about and how all of this info ties together. Today, the Fed had to provide additional reserves to the banking system...using overnight repurchase agreements totaling $1.28 billion dollars. Now, back to McDonough...]
While banks perform functions that are indispensable to the success of any market economy, these same functions, by their very nature, introduce risks that are capable of undermining the prospects for such success. This reality was acknowledged by Adam Smith over two centuries ago in his seminal tract The Wealth of Nations. It is with this fundamental reality in mind that governments have long recognized that banking and other financial institutions must be subject to some form of regulation and official oversight.
Revision of the 1988 Basel Accord
Let me move on to the Basel Committee's major initiative to revise the Capital Accord. The primary tool of capital regulation currently is the set of minimum ratios that were devised in 1988 by the Basel Committee on Banking Supervision, which I have the honor to chair. Without question, the Accord was a milestone achievement � for the first time, supervisors in G-10 countries were able to use a common yardstick for assessing banks� capital adequacy.
But the Accord has a number of serious shortcomings. It does not adequately differentiate among degrees of credit risk and, as a result, banks have had incentives to take on higher risk exposures within broad risk categories. Banks have also tended to engage in transactions that lower regulatory capital requirements without reducing economic risk. For example, through asset securitization a bank may physically transfer assets off its balance sheet, but still retain some or even all of the associated risk.
In June of last year, the Basel Committee released a Consultative Paper laying out its vision for a new, more refined capital adequacy framework � one that more accurately distinguishes degrees of credit risk, and that is appropriate for banks of varying levels of sophistication. The Consultative Paper represents an evolution in the Committee's approach to capital adequacy because, in addition to establishing minimum capital requirements, it places increased emphasis on the supervisory review of capital adequacy and the role of market discipline.
The Committee also is addressing what some observers have noted is the potential for introducing greater cyclicality via a more risk-sensitive capital framework. That is, the capital requirements for loans to troubled borrowers will tend to increase at just the point when such trouble is becoming apparent. This is an important point, and one that must be given serious consideration. It is my view that the global financial system needs to move toward addressing potential credit problems preemptively � before these problems have time to grow from minor disturbances to major disruptions. A more risk-sensitive capital framework should help ensure that banks hold appropriate capital behind high-risk credits in the first place, and thus reduce the cyclical tendency for retrenchment that often follows problems with such loans.
While having lunch today here at Centennial, I picked up a copy of today's USA Today newspaper. Front page, left hand column, lead story is about Internet execs who fortuitously unloaded large positions of their company's stock near the peak in February before this week's smash. Lead article in the "Money" section was about C. Everett Koop, Chairman of drkoop.com, who raked in $3 million by selling out at $9.00/share. The stock now sells for about $2.70/share. I always thought that stock was overvalued from its IPO. Apparently, so did he. Which brings me back to the old saw: The house made money, the broker made money; two out of three ain't bad.
But what really got my attention was two articles in this section. The first was about high tech workers whose future and fortune are tied to stock options. Talk about nervous nellies because they have bought expensive homes--well beyond what they should be buying--based on the growth in value (and expectation of continued growth) of their stock options. Then in just one day, reality breaks into their lives and their options are down 50%.
The second article (on page 3B) by David Henry was by far the most illuminating, in my opinion. This one really puts its finger on the pulse of this whole casino-like market. Mr. Henry compared the price action of JDS Uniphase, a high tech flier, with soybeans and found a 97% correlation. He quotes Bill Noble, a veteran of Chicago's futures markets, who summed it up by saying: "All that happened since October is that commodities trading has reinvented itself. JDSU. RMBS (Rambus), VIGN (Vignette), VRSN (VeriSign) and all the rest are just white-collar pork belly contracts." But you already knew that, all you posters and lurkers!
That's an interesting thought from your friend. Makes some sense. When the official gold runs out of the official vaults, then, confiscate because, gold WILL ALWAYS be needed in those official vaults. There's lots of gold accumulating in this country since 1973. After all, the gold IS here in the country. Legislation and/or executive orders are formality. I think our host is right about confiscation.
Friends of gold in high places; PUT A STAKE IN THE GROUND. Enrich yourselves and your constituents. Come to the aid of the international monetary system. Lastly, free gold.
Re: Rhody's Letter (msg 28215) The Power of the PPT.
When Rhody states that the PPT can maintain the excessively high equilibrium in today's stock market plus the unusally low gold price for many more years, then I must disagree.
Keep in mind that Tuesday's "controlled" market fiasco occurred in the midst of a completely uneventful day in the political affairs, markets, and economy of America. Although some would say that the Microsoft decision acted as a trigger, nonetheless it would be difficult to describe that as "a terrifying left field event."
Does Rhody really believe that the PPT can be so effective if some left field event arises that strikes genuine fear into the hearts of Americans and other foreigners?
Essentially, it appears the key to the PPT's effectiveness is an US environment of calm and plenty. It is certainly much easier to reassure investors to re-enter a plunging market when they look out the window and see sunshine and prosperity. But it is a much more difficult task when they know first hand of real trouble developing in their lives.
If tomorrow, just for example, the imported oil were to be shut off and Americans were slapped directly in the face with adversity, then how effective would a PPT be in such truly adverse circumstances? Would calming words from Clinton economic spokesman Gene Sperling suffice to bring buyers back into the marketplace if, just for example, a hostile confrontation arose between America and China, resulting in key good shortages in America (China manufactures a huge percentage of American imports).
My point is this: when Rhody imagines the PPT as some kind of omnipotent force capable of fixing markets for many years, he must recognize that at any moment, there might be a long overdue left field event that can subvert their best efforts.
If a genuine scare arises with international ramifications...and if foreign nations view the stability of the US Dollar, economy, and markets as endangered...then I believe the clamor for gold would be astronomical. The disgorgement of Western Central Bank gold would probably end on the spin of a dime. In such tumult, the Central banks would NEED a nation-neutral medium of exchange with its own intrinsic value, and would clamor to replace US dollars with it.
From my perspective, pressures keep building all over the world that increase the likelihood of such a left field event transpiring sooner than one might think.
For those new and old to this forum and the subject of gold ownership......
The US Government by Executive Order of FDR (admittedly, the right man in the right place at the right time) in 1933 confiscated the gold of all US citizens. It WAS ILLEGAL to own gold from 1933-1975; A PERIOD OF 42 YEARS.
Penalties for non-compliance were $10K fine and/or ten years in jail (in 1933 dollars and context). Exempted were coins minted prior to 1934.
For those who have no interest in history, I maintain it is a general outline for events yet to be.
I should like to take the opportunity of this special meeting to take stock of where we stand 15�months after the start of Monetary Union. In January 1999 the euro was successfully launched as the single currency for 11 Member States of the EU. As a result of very careful conceptual and technical preparations, both the monetary policy-making process and the implementation of monetary policy have functioned efficiently right from the start.
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The challenges involved in setting up a central bank for a currency area as large as the euro area have been enormous.
...
From the start, we had extremely productive and open discussions in the Governing Council on monetary policy issues. In this respect, our monetary policy strategy has provided a very useful framework within which to organise our thinking. In our discussions there has always been a clear understanding, based on the Treaty, that the single monetary policy can only focus on maintaining price stability in the euro area as a whole. This is based on the simple fact that in a monetary union, there is only one monetary policy, and this must be directed to a single objective. As laid down in the Treaty, each member of the Governing Council is therefore well aware that he or she is not a representative of a country or central bank but acts in a personal capacity in deciding the appropriate conduct of monetary policy for the euro area as a whole.
[The above gives a good view of the semi-fluid nature of policy and implementation]
The experience of all larger currency areas shows that some differences in regional price developments and also in regional output growth may exist.
As differences in national or regional developments cannot be addressed by the Eurosystem, they require, whenever necessary, country-specific responses. This means, in particular, responsible national wage settlements and appropriate national fiscal policies aimed at counteracting specific national problems. In addition, reforms addressing rigidities in labour and product markets and aiming at enhancing labour and capital mobility are the tools to ensure that market mechanisms will play an increasingly important role in limiting the scope for divergent developments in the euro area.
...
Let me now give the floor to the Vice-President [Christian Noyer] to present some of the additional topics discussed today by the Governing Council.
I should like to draw your attention to the following two items: first, the international financial architecture, an issue which was discussed in preparation for the forthcoming IMF Spring Meetings in Washington, D.C., and, second, the ECB's information campaign for the introduction of the euro banknotes and coins.
The Eurosystem actively supports those efforts made by various institutions and fora�... to enhance transparency and to improve the soundness both of financial systems and of regulatory and supervisory frameworks.
Owing to the fact that unsustainable exchange rate regimes were a factor behind financial crises of previous years, recent discussions have focused in particular on the choice of appropriate exchange rate arrangements. The Governing Council is of the view that such a choice should not be confined to alternative solutions of either a hard peg or free floating. Intermediate regimes, such as adjustable pegs, may suit the needs of emerging market economies, depending on their specific domestic and external conditions.
Refocusing the role of the IMF has been central to most recent reform proposals. The Governing Council is of the view that strengthening the key responsibilities of the IMF, namely further enhancing its credibility as a policy adviser and provider of financial assistance to members facing a loss of market confidence, will make an important contribution to international monetary stability.
Second, the Governing Council approved the overall framework for the EURO 2002 information campaign�- a Europe-wide campaign intended to familiarise citizens with the euro banknotes and coins.
The main objectives of the campaign are to help citizens:
** to recognise the euro banknotes and coins and, in particular, their security features,
** to familiarise themselves with the different (and, in many cases, new) denominations of the euro banknotes and coins, and
** to inform themselves about the means by which the euro banknotes and coins will be introduced on 1�January 2002.
We are now at your disposal, should you have any questions.
Question: You spoke about the role the national governments have to play in the strategy of keeping inflation down. The Irish Finance Minister maintains that Ireland's level of inflation gives no cause for concern and that his Government is doing all that is necessary for it not to become a problem. What do you think?
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Duisenberg: I think the Irish Finance Minister cannot say anything but what he said. A fact is, of course, that differentials in price increases across a large currency area are not abnormal. In a study we have recently published in our ECB Monthly Bulletin, we came to the conclusion that differentials in the euro area were, to our own surprise, even smaller than the differentials you see between some 25 cities in the United States. Still, I do maintain that the problem Ireland faces in having a substantially higher rate of inflation than the euro area-wide rate of inflation is a problem that has to be addressed. It will be addressed, I am sure, by the Irish Government, and by the Irish Government alone.
Question (translation): This is another question for you, sir - more or less along the lines of the last one. You said in your introductory remarks that the countries with a higher inflation rate within the euro area should have their own special monetary policies as well as structural reforms. Now, since in Spain we have a high rate of inflation of 3%, do you think that the current policies are the right ones for Spain?
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Duisenberg: Sorry, I did not say that they should have their own monetary policy. You see, we have only one monetary policy in the euro area. But they have their own fiscal policies and wage policies as well as structural reform policies, and those are policy areas which have to be addressed by the national governments, and by the social partners, I am inclined to say. But the European Central Bank and all of the Eurosystem can and will do nothing about that.
[TownCrier note: hold onto your socks for the next post. It points up a stark issue that perhaps you hadn't considered about dollars currently held in reserves...whereby central banks are now suddenly overweighted in the US dollar as a result of the EMU.]
http://www.usagold.com/cpmforum/tools/post.html On the issue of confiscation of gold -- FDR in 1933 that you were talking about; do you know if silver was also confiscated? Also, do you think it will happen again in a currency collapse? If you believe it's going to happen again this raises the debate of bullion coins versus pre 1933 gold coins and the question of the pre '33 coins being exempted again. What do you think? And do you think silver ownership will be outlawed too?
Continuing from the ECB Question and Answer session, this one's a good perspective builder
Question (translation):
I have three questions, but, of course, they are interrelated. The first question is this: Spain, Italy and so on used to have major reserves in foreign currency in their national central banks, especially as far as Deutsche Mark and Dutch guilder were concerned. But obviously, it does not make any sense to keep these anymore. When were they changed and how were they changed? Can you tell us? The other question is: the other national central banks around the world currently hold a certain percentage of their foreign exchange reserves in euro. To what extent do you think this percentage will increase in the next five years? And what do you say about profits? The Federal Republic of Germany used to receive profits from the Deutsche Bundesbank. How do you think this will increase, for example, for Germany or for the Spanish central bank in the next, say, five years?
Duisenberg:
Where have the banknotes gone which used to be held by other euro area central banks? I suppose they have gone back to their home country in the meantime. And what will happen to the profits? I cannot say. We do not know how profits will develop. What we do know is that in the Eurosystem we have agreed on accounting rules which, over time, will substantially change annual developments in profits, and that, for example, we now include unrealised valuation losses in foreign exchange reserves directly in the profit and loss account, whereas in the past it was usually written off against some valuation reserve in the balance sheet of the banks.
As far as the euro's share in foreign exchange reserves in the world outside the euro area is concerned, I expect it to develop over time. But, of course, you have to realise that we have been exposed to a certain shock as a result of the creation of the euro area itself.
Before the introduction of the euro, the distribution of world reserves over various currencies was - and I am giving very rough figures now - about 60% US dollars, about something like 25% Deutsche Mark and around 5% Japanese yen, with the remaining 10% being shared by a variety of currencies, including Swiss francs, French francs, Dutch guilders and special drawing rights of the IMF. With the transition to the euro, the reserves of the euro area countries were, in some instances, held in US dollars and Deutsche Mark - in my own country, the Netherlands, for example, we held 50% of the foreign reserves in US dollars, 50% in Deutsche Mark.
And overnight, the 50% Deutsche Mark had become domestic assets rather than foreign assets. So that phenomenon caused an immediate change in the world currency distribution of reserves. Because of the falling-out of the intra-euro area holdings of European currency reserves, it caused the euro share of international reserves to fall immediately.
And now it is growing again. So, we are now in a situation where between 70 and 80% of the world reserves are held in US dollars and around 15 to 20% in euro. I expect the same trend to develop that we have observed over the past 25 years, namely a gradual decline in the share of the US dollar and a gradual increase in the share of the euro. I expect that trend to continue. But it is a long-term process.
"do you know if silver was also confiscated? Also, do you think it will happen again in a currency collapse? If you believe it's going to happen again this raises the debate of bullion coins versus pre 1933 gold coins and the question of the pre '33 coins being exempted again. What do you think?"
To be sure, silver was not confiscated. Circulating small change (dimes, quarters, half-dollars, dollars) was silver and continued until 1965.
I sure do not want to stifle any debate on the likelihood of future gold confiscation with my following response. In fact, I would enjoy to see the various thoughts. My own thought on the matter, however, is that with the premium on the pre-33 coins European coins currently comparable with the similar-sized fractional ounce bullion coins, why take chances? Besides, with the pre-33's you get a much more fascinating coin to admire and muse over its history...if you enjoy that sort of thing. Plus, they lend themselves to handling, and passing around for your friends and family to admire. They were designed to be for circulation, after all.
Thank you for your running exposition of articles on the EC. I read each post carefully. I am drawn to the conclusion that our friend TG/FOA is hitting very close to the mark. The strategy or "the game" as TG would say is quite clear. Whether or not the execution and implementation will follow through is a very different matter.
My thought is success will be hard fought and eventually won because of necessity. You have to look beyond the deficiencies in the social, political and economic structure of the EC (mind you now, by american standards). Sure, they may appear as a collection of quasi-socialist nation states with high levels of citizen dependency on government and low levels of American "know how". Maybe that's not so bad. Maybe they're in their timing is impeccable if only for awhile. Know what I mean?
It is that time of the year again...the European Central Bank's quarterly revaluation of its total gold assets. They can't exactly be well-pleased with the adjustment this term, essentially flatlined from the previous valuation.
Total ECB gold assets on the weekly balance sheet fell by 269 million euros to 115.676 billion euros for March 31.
On paper, net foreign exchange reserves climbed by 12.5 billion euros to 266.5 billion euros.
Sir Cavan Man: Mostly, I like their sense of humor...
Question:
Mr. Duisenberg, Mr. Noyer, why do you think that the international financial markets continue not to acknowledge what you call the fair value of the euro in the light of robust growth in Europe?
Duisenberg:
I am very happy that the question was put both to Mr. Noyer and to me, ... because I do not know.
Noyer:
Could I say the same? With one voice? [a reference to concerns that the ECB should "speak with one voice".]
Cavan Man, one clarification to the exemption of pre-'33 gold coins: they had to be numismatic grade "lawful money" coins. I don't use the words "legal tender" because a legal tender referred to fiat currency insomuch as it tends to perfoming the same function as lawful money (gold & silver). All of the coins from our host are MS-60 or higher, so they are in the exempted class. OC
http://www.usagold.com/cpmforum/tools/post.html Towncrier, thanks for your response. I have two concerns on the pre '33 gold coins:
(a) you get less actual metal content for the
money as opposed to bullion coins like the
Eagle, Maple leaf, Philharmoinc, etc. etc.
A rough estimate is about 2 and half times
more gold content for the buck, bullion vs.
pre-1933, if accumulation of physical gold
is the objective.
(b) the pre '33 coins are difficult to find in
high MS and take longer to accumulate with
fewer options to acquire them
However, if bullion coins were confiscated in a collapse (or trading with them was outlawed) and the pre'33 coins were exempted, my argument goes in the toilet. My gut instint is that if it ever gets that bad even pre'33 items would not be exempted. A simple stroke of the pen with an Executive Order could modify FDR's old gold act to emcompass everything.
Would love to hear any counterpoint from anyone, as I'm in the early stages of accumulation, trying to carefully weigh all my options and protect my family.
I get to meet the public in my type of work/hobby and one of the more interesting persons I get to see about every week is a friend I'll call George. George is American and retired with full pension from the U.S. military, several years ago. After retirement from the military he worked for the Government of Saudi Arabia in Saudi Arabia at a supervisory level for 12 years. From those days till now he spends a lot of his free time traveling and seeing the world first hand.His wife is English.
Todays talk:
Me: I just drove to Chico(California) and saw unleaded regular gas for $2.02 per gallon.
George: Yup!
Me: You were in the Mid East, don't those oil producers want Gold instead of dollars for their oil?
George: Yes,all the high finance withen the Mid East is transacted in Gold. Arabs trust only Gold as real money.
Me: Why aren't the oil producers driving the price of Gold up by buying it with their dollars they've gotten for the sale of their oil?
George: Over the last 30 or so years the oil producers have made enough dollars to buy all the Gold AND Gold mines in the world if they wanted to,they have some kind of agreement with the rest of the world not to do this.
Me: A written agreement?
George: I don't know if it's written or not, but think about this,and I don't have any actual figures with me, oil producing countries may be receiving up to a BILLION dollars a day(40,000,000 barrels times $25.00 per barrel equals 1 billion dollars a day) times 100 days equals 100 billion dollars--times 1000 days (less than 3 years) equals 1 Trillion dollars.
OPEC was formed when? 30 or 40 or so years ago. They sell oil to the Japanese,Europe, every industrialized country in the world, including the United States.
Ask yourself this, where has that 10 trillion dollars gone to?
Me: Military spending?
George: Some, but nowhere near those amounts.
There is something else you should know. The entire Mid-East region is run(controlled) by wealthy families, who sometimes fued among themselves.Therefore, huge real wealth(Gold)is held by powerful individuals of different family's, I met the King( George's words) of Saudi Arabia, he has been shot and hit twice by members of his own family, who were in turn immediately gunned down by body guards.
Shieks may have up to 4 wives, and then some.
Some family's may have 1000 princes.
Me: Tell me more about Gold over there.
George: Each town, or market place has a money changer who can weigh Gold and exchange it into paper money or goods.His exchange rate is based on the world "spot" price of Gold daily price.(LBMA???).
Dhabi(spelling) in The United Arab Emirates is the largest seller of physical Gold in the world, they sell to anyone with the money to buy including the people from India who buy up to 850 tonnes per year.
I saw Gold in the market places many times over there.The U.S. 5 dollar Gold peice would be valued on Gold content only, not as a collectors item.(The rest of the talk was about places George visited)
Have to run now, see you next week.
Me: See you next week.
beesting comments:
Could the oil producing countries with billions or trillions of dollars at their disposal really be the ones keeping the price of Gold depressed using Goldman Sachs and Morgan Stanley etc. as their brokerage houses.Could the oil producers, "behind the scenes", set the London "Fix" daily price?
Who benifits the most from low Gold prices?
Answer: buyers of Gold and anyone who has been tought since childhood Gold is the worlds best storage vehicle for long term wealth.
Why doesn't the World Gold Council have official figures for amounts of Gold in the Mid East Region?
Answer: different type of Governing body, it's held by individuals (strong hands) not a Western type Government that is supposed to report financial matters to the public.No official reporting requirements!
Are the large holders of Gold watching with amusement as the un-controlled and controlled GREED of the Western World self distructs as ownership of paper wealth loses value?....beesting.
http://www.usagold.com/productspage.html>>>"I have two concerns on the pre '33 gold coins:
(a) you get less actual metal content for the
money as opposed to bullion coins like the
Eagle, Maple leaf, Philharmoinc, etc. etc.
A rough estimate is about 2 and half times
more gold content for the buck, bullion vs.
pre-1933"
Good God, man! Who is quoting you such exorbitantly high prices? Give MK's people a call at Centennial and they will make your day. Just as the best bang for your buck in a perfectly predictable world is to buy ounce bullion coins instead of the fraction bullion coins (half-ounce, quarter-ounce, tenth-ounce), so too would it be to acquire ounce bullion coins compared to the approx quarter- or fifth-ounce pre-33 European gold coins. But as I indicated previously, these pre-33's are not currently priced significantly different than the similar sized bullion coins. Certainly nowhere even near to two-and-a-half times the price...unless market conditions have changed while I wasn't looking. Again, contact the folks at Centennial during Denver Business hours for prices on gold helvetias, guilders, sovereigns, francs, etc. Ounce per ounce, the price is very comparable to bullion.
>>>"(b) the pre '33 coins are difficult to find in
high MS and take longer to accumulate with
fewer options to acquire them"
Shucks. I should have read your part (b) before answering your part (a). Now I can see why you are being bent over on prices. You are essentially tracking down coins that have been individually fussed over by men with tweezers, cotton gloves, and thick glasses. Centennial's "confiscation resistant" coins come in caches that have sat in some wealthy families safe in essentially brilliant uncirculated condition during all these years. The parents pass on, and the kids sell the gold. Foolish kids. Anyway, that is why the coins remain reasonably priced, yet also add a level of protections to meet your concerns against potential confiscations.
>>>"My gut instint is that if it ever gets that bad even pre'33 items would not be exempted."
One of the best arguments against such a confiscation happening to the historic coins is that the government is required to give fair value for anything they confiscate. They could be kept tied up in negotiations and in court for years as old world coin holders fight tooth and nail to keep their gold, arguing over valuation of each individual coin. That is too big a hassle even for the government to deal with. Bullion coin holders would have no similar recourse. Especially those holding coins minted by the U.S. itself, such as the modern gold Eagles.
Just some thoughts before blowing out the candle here in The Tower...
Everytime I see the conversation about confiscation, I will continue to post this message I posted March 24 until someone can prove me wrong. Folks, learn your constitutional rights before it is too late!
Twice Discipled (3/24/2000; 21:28:10MDT - Msg ID:27437)
Gold Confiscation � Read this and NEVER FEAR gain!
Ok folks, I too have had this concern, but now that I am reading "Vultures in Eagle's Clothing" which can be ordered from www.freedommall.com, I understand the hoax.
There exist the "united States of America" and the "United States of America".
The "United States" consist of the District of Columbia and other territories, NOT the 50 states of the union.
The laws enacted by congress for the "United States" are not bound by the U.S. Constitution. All unconstitution laws are null and void on sovereign citizens of the 50 states of the Union.
As a citizen of a state, NOT the "United States" you are not bound by any unconstitutional law or executive order; however, these may be enforced on citizens of the "United States" � the District of Columbia and the territories.
** By the way, this is all supported via Supreme Court rulings!**
So when FDR ordered confiscation of gold, it could only be enforced on citizens of the "United States" or those in the District of Columbia and other US territories. Everyone else who turned in their gold and was a citizen of one of the 50 states, volunteered through deception.
The same principle applies to taxes. Don't believe me? Can't blame you, even my wife is rolling her eyes. She said "What! Am I to think that everything I was taught for all of my life is a lie?" Read it for yourself. Once again I asked, "Who are the sheeple?" Are we, including myself, not sheeple of one color calling names at the sheeple of another color?
Oh Lord, take the scales off of my eyes that I may see mine enemy.
If we are to prosper and put this tyranny in its place we must learn the constitutional law of our country.
In my opinion, the Swiss citizens should ask for a referendum that would remove the gold bullion from their
government's control and also from the monetery system.
They could put it in a vault in a National Museum. A portion of the bullion could, on occasion, be displayed to the public and foreign tourists. It is doubtful that anyone will ever see the gold again, if it is sold on the open market for paper.
I am not aware of AuO or gold rust, as Au is an inert metal. However, the formation of synthetic corundum is another matter. Artificial corundum is manufactured from bauxite on a large scale, mostly for manufacture as an abrasive. Synthetic rubies and (blue)sapphires, colored with small amounts of Cr and Ti are synthesized by fusing alumina powder in an oxy-hydrogen flame which on cooling forms single crystal boules in what is known as the Verneuil process. I'm not familiar with all the intimate details. The commercial manufacturers use a tracer so that synthetic corundum can be readily distinguished from natural corundum. Generally it is easy to tell the difference, since synthetic looks too good and is generally "eye clean" where in natural corundum, inclusions are quite common, even in the best grades. Most rubies that I've come across have been more of a milky or clouded red color. I've only encountered natural rubies and sapphires in Mogok, Myanmar and through contacts in Thailand. However, I have not had much trouble telling the difference between synthetic and natural. BTW, how do you get gold rust? I've had 24K gold for many years and it still shines very bright J
As far as confiscation of Au is concerned, I wouldn't be too worried about it. For one thing, here in the US, we have extensive borders to the north and south where people cross legally and illegally without too much difficulty. If one held illegal gold, then all one would have to do is cross this imaginary line on a map and redeem your bullion for foreign currency or goods, then redeem that for FRNs if so desired. Besides, who would willingly turn over their gold to such a totalitarian regime that would steal gold from it's citizens. I know some gullible sheep will. I wouldn't do it, but then, I look at laws as merely suggestions anyway ;-)View
Yesterday's Discussion.
1. In a meltdown involving US stocks, bonds, and the US Dollar, it is obvious gold and gold stocks will have pure contrarian beta and be sought out as the only practical flight to safety. The public will disregard whether a gold stock is hedged or unhedged...whether there is a $1 of debt or $100 million of debt in the company. The public will race to physical and gold stocks, almost anything with the name gold on it.
2. Since gold finally established itself categorically as the #1 flight to safety in a stock market meltdown, the Establishment forces (notably the Treasury, Goldman Sachs, Barrick Bank & Hedge Fund, Inc., etc.) are going to work to crush the metal once and for all. They appear to be pulling out all stops in a determined attempt to invalidate gold as a safety haven, summoning all captive media to spin gold in the most negative light possible and convince the average mutual fund investor that gold is equivalent to toxic waste.
3. Contrary to the assertions by white metal enthusiasts, the only white metal likely to soar in a stock market meltdown will be silver owing to its special monetary status in certain parts of the world. During Tuesday's market collapse, platinum and palladium were NOT sought by investors. Moreover, PGM stocks (such as Stillwater) fell in step with the rest of the market. If one examines the very high mainstream mutual fund ownership in Stillwater (exceeding 30%), then its price drop during a crash is no surprise as mainstream funds were probably liquidating SWC in order to redirect cash for the rescusitation of collapsing high tech investments.
4. Given the market collapse and the reflexive flight to gold, then it will be very interesting to see the Swiss reaction to the event. Since gold finally proved itself as the only logical flight to safety Tuesday, then the odds that Switzerland might cancel its gold sale probably increased a great deal. Will the ultimate goldbug nation decide against a gold sale in the final hour? If so, what type of gold price explosion could occur upon such an announcement? Fifty dollars in one hour? Seventy five dollars in a day? Over a hundred dollars on the no-limit-up OTC? In any case, one cannot help but wonder about the timing of this market turmoil given that it is occurring so close to the proposed sale of Swiss gold...and given that it so obviously invalidates the faulty logic behind Swiss gold divestments. Most peculiar: the enormous purchases of June gold calls by obviously deep pocket entities.
5. Since oil prices and oil stocks collapsed on Tuesday, then the Establishment's oft repeated declaration that oil is the most desirable commodity in the world proved to be invalid. Once again, the "commodity" that has stood the test of thousands of years proved to be the ultimate beneficiary of frightened money: GOLD. Moreover, its scarcity as a financial asset (relative to fiat paper debt) made it even more attractive. In a world in which something like seven per cent of the population controls 90% of the wealth, then an asset in scarcity will hold much more value than a debt (like fiat paper) in abundance.
6. The fact that the stock market fell spontaneously in the absence of any unduly negative left field event may have shifted American mass investor psychology in a negative way In other words, the American investor, accustomed to linear reality, experienced an existential moment in which Tuesday was unlike any other preceding investment day. Although the turnaround was reminiscent of other past market problem days, the instigating factor (the Microsoft decision) was a unique one in that it appeared to be completely innocuous.
Moreover, given that we are in an election year, the much complacent American investor was particularly shocked by such a downspike. Finally, the international investor likely experienced an existential event too, seeing a surprising, unexplainable manifestation of "American hysteria" in a country and market long perceived as stable, calm and secure.
Comparative analysis of the operational outcomes of a primative moded systems thought form, juxtaposed to reflect modern refinement.....:.
Aztec preists high atop the Ceremonial Pyramid reflect. "We have cut the hearts out of many a supplicant today. The streaming blood nourishes the Most on High, the Sun will come again".
Goldman Saks traders high atop the Wall Street Skyscraper reflect. "We have gouged the eyes out and ripped off the face of many a supplicant today. The streaming money nourishes our Corporate Coffers, Our stock will rise again". See how Worlds are sustained.
I agree that gold has sent the signal on turnaround Tuesday that it may just be a good place to park some fiat as a hedge against market disruption. I tend to think of the concurrent rise of gold and fall of all else as an effect caused by the "natural bouyancy" of gold. These days for gold not to rise in price takes continuous management and intervention. When attention is diverted for even an hour we see the cream start to separate and rise. Unfortunately, the obvious was also noticed quite quickly by the same group who engineered the stock recovery and gold was beaten back down.
http://www.quicken.com/investments/cbswatch/market_snapshot/?column=P0DSTBenign report leads to higher S&P Futures, currently +11.50. Could be an interesting open in New York. Gold down -$0.65 to $279.15. No real news on PMs this morning. Could be a boring day for the metals, but then, Ya Never Know!
Will the Dot.coms Bring Down the Stock Markets? --- We're About to Find Out
By Alan Goldstein / The Dallas Morning News
Mark Cuban may have made his fortune with a hot
Internet stock, but when he surveys today's dot.com
landscape, he doesn't like what he sees.
"Most of the ones you see out there won't even be in
business in two years," the Dallas billionaire said,
following a luncheon speech at the Infomart to
entrepreneurs looking for advice on running Internet
businesses.
"If they can't raise more and more money, they're
toast," he said. "There's not three of them I would
buy right now. Other than Yahoo, of course."
Mr. Cuban told the entrepreneurs that it would be
more difficult to start an Internet business now than it
was in September 1995, when he co-founded
AudioNet based on what was then a radical notion:
sending radio programs over the Internet. Soon, the
company was transmitting video as well.
The company went public in 1998 as
Broadcast.com and was sold last year to Santa
Clara, Calif.-based Yahoo Inc. in a deal worth
almost $6 billion.
Mr. Cuban, now the owner of the Dallas Mavericks,
was asked whether he thinks dot.coms are
overvalued.
"Ninety-nine percent of them, yes," he said,
reflecting an increasingly prevalent sentiment that has
been tanking many technology stocks this week.
In his speech, Mr. Cuban offered his 10 rules for
running a dot.com business.
All are based on creating an aggressive, viable
company where success is measured in traditional
ways, such as growth in revenues and net income.
"You really have to have an angle. You have to have
something that's compelling and differentiated. ...
There have probably been 50,000 or more
dot.com-related businesses started in the last 12
months. There's only been 300 or so that have gone
public. What about the other 49,700? You're not
going to see 50,000 dot.com companies go public"
over the next two to four years.
His rules are:
1. Design the company to be profitable. "Today,
people think they need an exit strategy," he said.
"But that requires that you have a market to exit to.
After the past week, that may not be the case. ...
You need profits to pay back investors and
yourself."
2. Culture is critical. Broadcast.com enjoyed a
wildly successful initial public offering in 1998, but
the founders were reluctant to celebrate. "How the
market responded to the IPO was a reflection of
supply and demand for the stock," he said.
Executives felt humbled by investors' expectations
for the company. "We celebrated big sales, not the
fact that we went public."
3. Do not under any circumstances listen to your
customers. "By the time a company asks for a
service or feature, it's too late. Learn to anticipate
the customers' needs."
4. Build barriers to entry. "We built exclusive
relationships with content providers and customers.
We would lock out competitors."
5. Differentiate. "Changing the way a Web site looks
is easy to do. Focus on things that truly make you
different."
6. Traffic is king, not content. "If you don't get the
traffic, it doesn't matter what the content is. ... It's
the most expensive asset to create on the Net. You
need to be guerrilla-like in going after traffic. We
went out and found things that had big audiences
and became aggregators."
7. Make it easy for customers to complete a
purchase. "When all is said and done, it better be
close to one-touch buying."
8. Sales cure everything. "If you've got sales people
selling, you can generate revenue."
9. Focus, focus, focus. "You can drown in
opportunity in this business. Be specific. 'Here is our
mission.' ... But you're going to be wrong, and you
might have to change focus."
10. Either you're disrupting the competition or
they're disrupting you. "If I saw somebody who I
thought was going to be a key account for them, I
went after it."
Mr. Cuban offered an addendum to his list: Have
some fun.
"All the sleepless nights, the long days. I wouldn't
change a minute. It was a blast."
[Fair Use for Educational/Research Purposes Only]
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Market Report (4/7/00): Gold was sideways this morning with all the markets
seeming to be in search of direction. Trading was light in the London market
going into the weekend. The Asian market was marked by further selling from
Australian producers. Overall the gold market is quiet this morning. Today we
get jobs data. "People expect a pretty big payroll jobs number," said a top
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here a few days ago, those of us operating in the real economy on a day to
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Market psychology was indeed hurt by near-miss Tuesday. You aptly describe the event as an existential moment: one of those rare but human phenomenon that shows the world is not a fixed set of rules, rather a system that tries to find equilibrium with moments of panic. That said, however, I would like to add to your comments.
The near-miss Tuesday aptly showed that no matter what us goldbugs think or do, the market will pretty much ignore our view, meaning: if we believe the market will rise, it will fall. If we feel the market will favor gold, it won't.
The only times we have prevailed was during those moments of chaos or panic that somehow managed to prevail, if but for an instant. This actually lends itself to predictive power -- how can so many smart people be so wrong, so often? Well, somehow, we are managing to do that. So, let's have some fun with our new-found predictive powers (with reverse control surfaces).
Prediction:
Since we believe the market is overvalued. It is not. It will continue to hold steady or rise.
Since we believe gold is undervalued. It is not. It will continue to remain low.
Since we believe that silver and gold and S&P futures are controlled or manipulated markets and that exposure to the press will ameliorate that situation, it will not. It will only serve to entrench our enemies in their false-beliefs. Therefore, the press will never expose the truth, the markets will only go down during rare moments of chaos caused by seemingly unrelated news that is in the making but hasn't been determined yet.
The Republicans can use the alleged manipulations of the gold market by the ESF and certain bullion banks to their advantage. They won't. They will completely miss this excellent opportunity.
The preelection era will be an excellent time for things to unravel. After all, gold can not continue to be held down that long. Wrong, the markets will be held intact through the election, gold will continue to be held in abeyance until after the election.
NASDAQ is overvalued as is much of the DOW. Wrong again. 100:1 P/Es are the norm, at least until after the election.
The CNN's and CNBC's will finally see the light and expose the manipulators. Wrong yet again. The talking heads will continue to use the very people whose interests are to extend the bull market as their keynote commentators. It is a self-fullfilling relationship in which those most interested in continuing the bull are placed in a position to extend the bull.
Federal regulators are investigating on the QT all of the shenanigans in the market place, including the ESF-GS connection. Wrong. This is exactly what isn't happening. The exposure of this will not take place until all else comes to light after the election and after one of those existential moments burns a lot of peoples bank accounts. Only in hindsight will all of this be exposed.
Hey this predictive stuff is fun. Try it. Just find a hope, dream, or belief or expectation you have. Write it down and then predict the opposite event to happen and it will.
No, there is no rule here that says, if you discover the rule, that it will change the outcome. Nice try though.
About the only expetation that won't follow the rule of opposites is that there will be one or more unpredicted, chaos moment(s) that will turn these markets and cause gold to rise. We just don't know what or when, but it won't be what we expect nor when we expect it.
SteveH
PS. So, if you see one of us make a prediction, find out what the opposite or converse is and that is what will really happen. Try it,it works.
You said
----
Hey this predictive stuff is fun. Try it. Just find a hope, dream, or belief or expectation you have. Write it down and then predict the opposite event to happen and it will
----
I wish my wife would find me sexually repulsive and do whatever she has to do to torture me umercifully... futhermore, I wish Pamela Anderson Lee would find my wife to be sexually unattractive and establish an absolutely hellish relationship with her and decide to stay married to Tommy Lee. My wife would then convince Pamela Anderson Lee that I am not only sexually repulsive but that I am in fact the most sexually repulsive single individual on the planet. My wife would then selfishly do everything in her power to keep Pamela Anderson Lee as far away from me as possible so that she would not have any chance to experience intimately and repeatedly the absolute repulsiveness that is me.
I used to get (and read) all those investment letter come-ons in the early 80s ("buy gold" Howard Ruff-type) and marvel at their writing skills in generating ad copy. Of course Mark Hulbert tracked them, too, and showed their predictive powers to be mostly below average (below S&P anyway).
I, on the other hand, found that I had _remarkable_ predictive powers, in that whatever I did, it was bound to fall or reverse almost immediately, or stagnate for many years.
(Continuing in that vein, I've been warning my clients to bail out of stocks since about Dow 3000. I'm used to the look they give me now...)
So, putting 2 and 2 together, it occurred to me as long as 15 years ago to publish "The Corrigan Report" (as in "Wrong Way Corrigan, famous football incompetent who scored for the opposition) which would announce what financial moves _I_ had actually made (bought a house, stock, PM, etc.), and then my subscribers could contrarily trade that information to their great profit.
Hopefully, the newsletter revenues would cover my sacrificial investment losses on their behalf. Never got around to it, and now that I think of it, me starting a purported investment newsletter would have been the signal for all the Bill Bonner types to get out of the newsletter business, right? But I didn't, and they didn't, and the rest is non-history...
Should I be serious here for a moment, if anyone has read this far? The probable reason we contrarians have been wrong so far is only that we have failed to comprehend the utter corruption, tenacity, and successful propagandizing of the system we've been betting against. But that is merely the set-up for FOA's prescription that under such a scenario, you only need to be right ONCE in a lifetime for your investment program to redeem itself.
And the middle question I have asked often in the context of the manipulation scenario: Are the individuals who are the agents of the system secretly making the same choices we are for their PERSONAL portfolios while carrying out their price-suppressing functions in their government/corporate roles? We'll probably never know, or only after our investments are confirmed by market events themselves. Then the manipulators will be merely an interesting footnote to the history we have lived.
STEVE H...a glaring error in your goldbug rule of opposites
You said...
The preelection era will be an excellent time for things to unravel. After all, gold can not continue to be held down that long. Wrong, the markets will be held intact through the election, gold will continue to be held in abeyance until after the election.
--------------------
Steve:
I don't know of any goldbugs or any mainstream investors who think that the gold market will be set free prior to the election. The majority definitely believe the gold market will be controlled until then.
SO by virtue of your rule of opposites, the gold market should break loose of its chains.
Sir Steve H. - Your postulations do not bode well for those of us who feel our Second Amendment Rights will persevere, as I have thought for 40 years of NRA membership.
The Hobbits are seeing next to NOTHING is happening at the Gold Pit on the COMEX ! THEREFORE, in line with the SteveH and F * thinking -- HOLD ON TO YOUR Beanies, you seasick seaserpents !
<;-)
There is a school (one member, at least) that subscribes to this scenario unfolding in Canada. Please note that while Roosevelt perped this travesty upon the people of the United States, no similar event occurred in Canada. In a sense one might be inclined to believe that Canadians are ripe for the plucking.
The school (of one) also subscribes to the notion that this could even take the form of arbitrarily enforcing a policy that gold and silver Maples to be worth only their face value thereby repatriating (confiscating) the gold to the mint.
Another form of confiscation could take the form of blaming miners for the mess and nationalizing them.
This is just a school (of one) way of thinking about this.
Goldman Sachs & Crew will be aboard gold stocks when the time is ripe for a true correction. You see, it's the best hedge they've got...with their major problem with the physical, at least they can off-set it through the rise in gold shares. Tuesday was not the first day gold shares have reacted positively to a falling market this year, but it was the most dramatic. I don't see them stopping a TRUE rise in gold (one where money comes in to stay, and lots of it).
It has to be obvious to everyone by now that the way to play this overvalued market is not to short (you'll get your head handed to you on the snap backs), but to buy shares of major gold producers and sit on them as a hedge.
As I predicted accurately yesterday, the market celebrated the jobs data today. I have not bothered to check what the actual stats are since they no longer have any meaning to me or anybody else. Every employment report is cause for celebration in a manipulated market. SO who really cares? I know I don't.
However, of course, there is one other reason the market is exploding today. It is "IPO FRIDAY" featuring numerous high tech IPO's and the various mutual funds have been busy ramping up the NASDAQ in order to promote the proper bullish environment. Again, this is no surprise and has become an established pattern now for several years. If you think the pattern will ever disrupt, then you believe in a free market and you also believe in Santa Claus. However, today I do not.
Now that the funds have properly manipulated the NASDAQ upward, they can sell their IPO's.
Now, remember this: each IPO is designed to ensure a huge price explosion. This is achieved by NEVER providing sufficient stock to meet public demand. For example, if you know the public wants at least 20 million shares of INTERNET PONZI SCAM INC., you must never provide more than 4 million shares to the market.
Of course, in the old days when the Wall Street Establishment and government regulators aspired to a rational free stock market, a company would attempt to gauge public demand for new stock, then set an IPO price and provide enough stock to afford the company a reasonable run-up in stock price. Back then, Wall Street knew that it was not in the best interests of market health or the economy to create "maniacal" stock run-ups as that would foster a casino environment.
Sometimes when I watch these hysterical Wall Street IPO's, knowing that much of the mania rests on the actions of day traders, then I wonder whether the internet brokerage companies are primarily responsible via fat bribes to various market regulators and government officials. It just seems inconceivable to understand how Wall Street and the government have allowed this kind of insanity to take hold since in the long run it cannot be in the interest of the market or the country.
Governing controlers around the world have deemed certain, shall we say *commodities* are unfit for human consumption, yet they flourish in the underground (actually quite above ground) arena. The value seems quite contrary to their legality, so in effect we gold-bugs should hope for the purported confiscation and illegality of our favorite commodity. This all with respect to Steve H's inverse corallary.
Lamprey-You are so right about shorting the market. Thank goodness (the forum here) I am completely out of that game.
Gresham-It sounds like you and me have been on the same investment program. Everything I bet on went the other way or stayed flat. I really know how to pick 'em.
@ USAGOLD Msg ID 28117, All: Regarding Market Rigging
You stated in part as follows:
"I would point out to Mr. Crudele that though market rigging might be politically correct in an election year,if you or I were to do it, we would find ourselves pleading our case before a court of law. Why are Goldman Sachs and Merrill Lynch permitted to do it with impunity? And not only permitted to do it with impunity, but encouraged and sanctioned by the very same government that is supposed to be regulating such activity."
I am having difficulty in understanding what Goldman Sachs and Merrill Lynch are doing that is illegal. If they are investing their own money to move the market, what is wrong with that? Are you implying that it is government money that is being fed to them? Please explain what constitutes the illegal process of "market
rigging".
http://www.usagold.com Here I am, after some soul searching and repentance, back to post again.
My insight is not much and just based on my own perception and common sense.
It seems to me that the one element missing from the previous run ups in Gold was sustained investor demand.
The events of early this week show the investment dollar will flee to Gold in the event of a stock market crash. It seems safe to predict that gold will rise dramatically when the stock market crashes.
When will that happen? I dont know, but a guess would be when the market in general perceives that stocks without earnings are bad investments.
Ravi Batra in his recent writings to touches on some of these points: predicting a crash and that Gold is the only safe haven.
Fed adds nearly one billion dollars to permanent reserves via coupon pass
Instead of the usual temporary adds through open market repo operations, the Fed pulled out the heavy guns for the third time in two weeks, adding $986 million in permanent reserves to the banking system through the outright purchase of Treasry coupons (dated between Dec 2000 - Sept 2001).
Rigged, fixed, manipulated markets - Nothing new there!
What is new, is the blatant, audacious and unabashed (pleonasm?) way the administration is administering these poison pills to their own constituents and to the rest of the world. Whatever the US and its constitution has stood for is being abandoned for the sake of short term virtual
glory.
Gory! - It is beyond my mental capabilitiies to envision the end game, which may not be too far away. It will wreak havoc among the unsuspecting participant (baby) boomers, never ever been exposed to adverse market conditions and conditioned by the official US of an everlasting and well deserved land of milk and honey. The "official" and begnign (not neglect) interventions in markets since at least Oct. of 1987 have been at the root of the spreading belief of the ultimate bailout of the US$ and US-Market Investor, as well as the root of the last safe haven (syndrome?) idiocy!
As some of you on this great forum, might have suspected I've been involved in gold exploration and development for years, though coming from the financing side of the equation, but never promoted anything other than -physical gold -here. I, as most of you do feel stress levels building to utter exasperation at the total unfairness of this rigged ploy, I have to rethink some of my personal strategies in the next while.
I will, of course, be lurking as time permits. In the meantime, I would like to thank you all for most stimulating discussions, insights, education and "virtual" friendship, with special kudos to MK, TC, FOA, ORO ... to name a few.
Will the government confiscate gold? If they try will they succeed? After all, this isn't 1933 any more - today half the American people won't even fill out a census form! Hmmmm... How to force compliance...?
Remember Mogadishu, Somalia? A Delta/Ranger Task Force was shot to pieces by an armed and aroused citizenry (like it or not) - and sent packing. That won't work.
But in Tiananmen Square some students tried to exercise their (God given) right to free speech without first having secured (for themselves) their right to bear arms and were crushed. Score one for tyranny!
Hmmmm... Better confiscate the guns first Bill.
This just in via e-mail...RE: Mr Gresham (Msg ID:28256)
"Wrong Way Corrigan" was a flier-early 30's-who wanted to fly to
Paris-a la Lindberg. He was forbidden to do so and so filed a flite plan
for a West Coast destination. Wound up in Paris. When questioned in
Paris, he said
"Humph, must have flown the wrong way"
Re the football angle, Roy
Riegels of the Univ of Calif.in the 1927 Rose Bowl game against Alabama
carried a recovered fumble about 65 yds the wrong way to the Cal 6 yd.
line whererint on the \ he was tackled by teammate Benny Lom.
Have seen the same misconception in print three times lately on the
internet. Hope this helps the price of gold.
---------------------
Thanks for that info!
TownCrier would also like to add that it was big purple #70 Jim Marshall of Minnesota Vikings fame who did Roy Riegels one better...he actually scored the touchdown. A great guy, Jim.
Hear ye! Hear ye! A long labor is now available for review!
http://www.usagold.com/halloffame.htmlThe Hall of Fame has been updated with all qualifying posts that have been brought to the attention of us here in The Tower.
Lots of new material, including an update for the latest contest winners.
Plenty of reading material for your weekend! Enjoy!!
Once again, the same anti-gold guys (Chase Manhattan, Lehman, Bill O'Neil, etc.) utter the same bullshit ad nauseum. Not a day goes by where these guys don't release anti-gold news into the media. For a metal that is supposedly a mere undesirable commodity, how the hell does it attract so much attention?
It can only be desperation, it can be nothing less.
Their game of deceit is coming under a spotlight and a house of cards is a very precarious thing.
Thanks
F*
----------------------
Business
For Gold Bugs, Rallies Fail to Last as Long as Hope: Spotlight
�
Bloomberg News
Apr 7 2000 11:53AM �
New York, April 7 (Bloomberg) -- Eddie Toolan says he's convinced of the value of gold. A third of his family's $1 million portfolio is wagered on the precious metal. And even though his gold holdings are down by more than half from their peak, Toolan is hoping they will soon end a four-year decline.
Trouble is, it may be a very long wait. After gold posted a 16 percent gain in September that was its biggest one-month rally in 17 years, prices resumed their descent to around $283 an ounce and now are a third lower than the 1996 high of $420.
The slump has left Toolan, a 53-year-old sixth-grade science teacher in Brooklyn, wondering why gold is down again. After all, didn't gold rally when European central banks had promised in September to limit their bullion sales? Won't that help prices?
``I'm convinced investing in gold is more of an art than a science,'' said Toolan, who put family retirement money in gold equity funds in 1993. Maybe if he'd studied psychology instead of science he'd better understand what's ailing gold, Toolan said.
It isn't just the psychology of investing that has changed the outlook for gold. Prices have been declining for much of the past 13 years because of the lure of other investments, tame inflation and ample supplies of the precious metal from the vaults of the world's central banks.
A decade ago, gold was prized as a store of value in tumultuous economic times, when inflation erased earnings from bonds and other investments. With few signs of accelerating inflation on economic radar screens for years, and central banks unloading their bulging reserves on an uninterested market, those heady days are long gone.
Just a Commodity
The ``conventional wisdom is wrong,'' said Peter Ward, a gold equities analyst at Lehman Brothers Inc. in New York. ``Gold is becoming another commodity and it's a commodity with an enormous inventory problem.''
The September announcement that 15 central banks in Europe agreed to limit bullion sales to a combined total of 2,000 metric tons over five years had the intended effect of stemming the rout in gold prices, sending them to a two-year high of $339 an ounce on the Comex Division of the New York Mercantile Exchange in early October.
The celebration among investors known as ``gold bugs'' was short-lived. Subsequent gold sales by the Bank of England -- sanctioned under the September agreement -- got a lukewarm response from buyers. Gold prices, as reflected by New York futures, are down 17 percent from the October high, and analysts say there's little to stop the hemorrhaging.
``Things are getting ugly here,'' said William O'Neill, head of futures research at Merrill Lynch & Co. in New York. ``While we could never be accused of being gold bulls, having been abject bears for the last 10 years, gold is somewhat weaker than we might have expected and we could be in jeopardy of testing last year's lows.''
Bank Reserves
At the bottom of its long slide last year, gold reached a 20- year low of $253.20 an ounce on the Comex in July.
While the plunge in U.S. stocks this week gave gold a temporary boost, sending prices up 2.2 percent on Tuesday, the flurry of buying as some investors sought a safer haven for their money was short-lived.
``It only bought gold some time,'' O'Neill said, and prices fell for the next two days as stock prices stabilized.
Big culprits in gold's slide have been central banks, who are the biggest holders of the metal. They've been selling it and lending it to speculators as a way of getting a financial return on an asset that would otherwise collect dust in their vaults.
At the end of 1998, central banks held 32,737 metric tons of bullion in their vaults, according to the International Monetary Fund's latest reports. That's equivalent to 10 years of mine production.
Record Output
As long as all those gold bars were safely tucked away, they had little impact on the market. That changed in March 1989, when Belgium said it would offer 127 metric tons of gold from its reserves. Over the next decade, central banks in the Netherlands, Canada, the U.K., Austria, Australia, Argentina, Luxembourg, India, the Czech Republic and South Korea followed suit, swelling available supplies at a time when mine production also was up.
Last year, global mine production rose 1 percent to a record 2,569 metric tons, according to precious metals research firm Gold Fields Mineral Services Ltd. in London. While new production fell short of demand of 3,672 tons, the difference was made up by gold inventories from central banks, scrap and sales of future production by gold miners.
``Gold is definitely in a bearish mood right now,'' said Donald Eckert, head of precious metals trading at Chase Manhattan Bank in New York. There is ``record output and you have these central bank sales overhanging the market.''
Switzerland, known for gold as much as chocolate and cuckoo clocks, is preparing to sell 1,300 metric tons of its reserves over five years, and the U.K. is in the midst of selling 415 tons over several years. Also, the Netherlands is unloading 300 tons, and Austria this week announced plans to sell 90 tons.
Hanging in There
Toolan, the Brooklyn investor, has seen the value of his gold holdings, including investments in the American Century Global Gold and Van Eck Gold Resources funds, plunge 70 percent from their peak in 1996.
He has no plans to bail out just yet. Toolan said he could have cashed out with a 10 percent to 12 percent profit after gold's rally late last year, but he was so convinced that prices would go even higher, he stuck with it.
"Maybe if he'd studied psychology instead of science he'd better understand what's ailing gold, Toolan said."
Let's take a look at the psychology of the big media, government, and Wall Street. Manipulators, Keynesians, statists, socialists, big government doo-gooders. Whatever you want to label them, they worship government. They believe in intervention. The state is all powerful. There is no other way. The liberty of a few individuals can and must be sacrificed to ensure the survival of the state. Popular opinion must be controlled.
People of this mindset killed 50 million people in the last century. Many of these people believe because it is all they have ever known. They grew up watching TV and absorbing propaganda from public schools.
Someone over there in the midst of those who write this Bloomberg News garbage must know the truth. The storm in the world of paper assets is reaching a hurricane pitch.
I'll bet that there are many more of those Marty Armstrong types. Trash talk and collect a paycheck while it lasts. And hide a few thousand ounces of gold bars in the closet.
The offering of that Bloomberg article has a distinct scent of desparation, indeed
Something must be happening (going poorly for the Funds) behind the scenes. I wonder what developments may unfold next week?
From the text:
"Toolan, the Brooklyn investor, has seen the value of his gold holdings, including investments in the American Century Global Gold and Van Eck Gold Resources funds, plunge 70 percent from their peak in 1996."
Sorry ol' chap. Had you not tried to generate dollars by buying into derivaties of gold and the promise of leverage against price movements, you would still be sitting on a king's wealth. Solid gold, metal in hand, is the only way to go in a market where the price is determined by an easily inflated paper derivative market.
In a twisted sense it's like this. Imagine that nobody is buying the soap, yet everyone is scheming over how rich they will be as a network marketing distributor, signing all of their friends up as distributors, who in turn are scheming along the same lines. In an attempt to draw the parallel closer to gold, while they attend meetings and sign each other up, the great unwashed masses of the world are happily "stealing" the unattended soap at criminally low prices...leaving the managers to stink up the place with no soap of their own in the end.
When I was a boy my father had a job in a shipyard paying about $35.00 per week take home pay. The going rate at the time.(1940's)
Although trading Gold for stuff was outlawed at that time everyone and I mean everyone knew the official U.S.Government set price of Gold was $35.00 per ounce.
So, my dad worked a 40 hour week for the equivalent of one ounce of Gold-$35.00.
April 7,2000 minimum wages in the U.S. are about $6.50 per hour or $266.00 for a 40 hour work week. Less than the current value of an ounce of Gold, but were not quite done on the comparison. Most employees in the U.S. have compulsory deductions (CONFISCATION) already subtracted by employers in varying amounts.
Lets choose 30% for the above $266.00 earned.(I think that may be a very low figure- 30%.)
That means $79.80 is confiscated and $186.20 is left.
So in essence our minimum wage worker made about $4.66 per hour or about 1/3 less than my dad when his take home pay will only buy 2/3 of an ounce of Gold if Gold is around $280 per ounce.
So, that means a person would have to earn about $9.10 per hour or $364.00 per week to take home $280.00 or one ounce of Gold.....WRONG.... The friendly U.S. Government has a sliding scale on deductions upward.....The more you make the more they confiscate. I estimate $10.00 per hour may be enough to buy an ounce of Gold after deductions for 40 hours of labor.
So when the U.S. Labor department releases labor statistics how many of those millions of employees in the U.S. working for minimum wage or a little over can buy what my father could buy in Gold in the 1940's with his weekly pay check?
A reality check.....paper money creates an illusion of wealth. Want real wealth....buy Gold....beesting.
**Mr. AREM: You asked about the legality of market support in times of meltdown. J.P. Morgan provided margin money by ordering/persuading bankers to use reserves in 1907 and probably averted a larger downturn than what did occur. His firm tried again in 1929 to no avail. The legality of government intervention is debateable. That they do intervene certainly raises questions about our "free markets". Intervention will also magnify the imbalance that the market movement was trying to correct. How it is done and by whom has been debated here for some time. I suggest traveling through the arcives of the last month or so keeping an eye open for posts concerning the PPT or the ESF. They will explain much and lead to other sourses of information. Happy reading! Be forewarned- the more I understand- the more questions I encounter.
**So many questions, So little knowledge!
Since I pre-date you by a few years, please allow me the
liberty of an observation.
In the 1930's a good daily wage in the USA was around
one dollar. Yes, there were jobs that paid more, like
shipbuilding, but I'm talking about the average wage
earner. Remember, times were hard. Forgetting about
the 25% unemployment rate, I truly believe that if you
made one dollar a day, you were lucky.
Now back to your theme....whenever I look at a Morgan, or
a one ounce silver American Eagle....this is how I believe
we should be comparing today's paper wealth to real wealth
...to silver.
Bravo to you, my friend. You have made a valid comparison.
But, a silver dollar will always be my measure because gold
pieces disappeared in 1933. This was just before I can remember anything.
@TOWN CRIER...I think your analysis is very perceptive
It's something I've been pondering myself today. It seems inconceivable to me that the market can plunge the way it did on Tuesday without wreaking disaster upon some major hedge fund or mutual fund or bank. No different than the LTCM scenario except this time maybe far worse.
Why?
Because Greedspan came under huge fire for his emergency rescusitation of LTCM on the categorically specious grounds it posed "systemic risk." This time, he will be under great scrutiny if he tries to pull another fast one like he did with LTCM, utilizing the bogus systemic risk excuse to prevent a group of his rich Wall Street buddies from losing a significant dime.
In fact, the LTCM founder himself denied later that LTCM's trouble ever posed one scintilla of systemic risk. To lend credence to that assertion, he is back in business with another large hedge fund utilizing the same leveraged investment techniques as before. For a fellow who supposedly almost toppled the financial system, he certainly had no trouble getting back in the game. That fact alone verifies the BS nature of the entire Greedspan rescue.
If Greedspan tries another LTCM-type salvation effort behind closed doors, then I think a lot of Republican politicians might wish to obstruct him since it is an election year. After all, it is in the Republicans' interests that the stock market and economy both go sour this year and NOT spring back. If the stock market remains in status quo vertical position, then the Democrats will win by a huge majority, probably the Senate and the House this time.
In any case, the very low volume springback in the NASDAQ today plus the flat performance of the DOW suggests that some major institution out there is having trouble again. The NASDAQ's very low volume upmove today probably consisted of a great deal of short covering rather than new funds inflows. The DOW's flat performance smells like a lot of guys wanting to get out but not getting the kinds of bids they want, so they stayed flat.
If there were no institutional problems occurring in the markets, thus creating negative multiplier effects, then I would have expected very high volume gains in both the DOW and the NASDAQ. Didn't happen though, did it?
http://www.usagold.comMy dear boy. It's called state-monopoly capitalism, not socialism. The game is rigged. The trick is knowing who's side of the game to be on.
RE: "More Overview""The Euro will keep taking share from the dollar, especially if major US players trade the Euro down to parity. Eventually (and presently as this is happening now), dollar reserves held outside the US will be forced into shorter and shorter maturities as the "return on" these holdings becomes more important than their "use as trading currency". This will drive dollar rates far above Euro rates, draining liquidity and forcing the FED to continue "Most" of its pumping action (what so many thought was Y2K related). Rising dollar rates will be in response to this new currency problem....."
I believe we might be witnessing the above.
The US has begun a buyback of 30 year issues and in all likelihood will continue to do so. The bond market has responded by inversion (10 Yr. lower than 30 Yr.). Historically, long term debt is a lower yield than short. Why buy back the longer term debt first? I need help with the answer. For myself, I'd pay off the car loan before the mortgage. I think we should pay close attention to the bond market during the coming months.
"Our sole reason for writing is a private commission to share official directions and perceptions with the average citizen of the world; nothing else..........This view gives you no facts only our perceptions from the builders of the future. We offer only the evensts as they occur for our proof."
CM comment: The singular constant feature of international monetary policy is change/evolution. It is not unreasonable to conclude that we are living in a day and age when we might see additional evolution in real time.
CPM PMs supply-deficit report, now you got your weekend assignment!
http://www.kitco.com/pda3992.htmlA very interesting reading assignment for the weekend boys and girls. Supply - deficit of the PMs in a nice "to the point" report! The silver section is particularly interesting (with all due respect to Ted Butler for his constant warnings and advisories on the subject). So kick back, open a cold one, read, think, and share your thoughts one and all. I'm headed to the Fridge to pour a tall one and a leisurely rereading of the forum posts and this report.
Farfel: Don't hold your breath waiting for Repubs!
"If Greedspan tries another LTCM-type salvation effort behind closed doors, then I think a lot of Republican
politicians might wish to obstruct him since it is an election year. After all, it is in the Republicans' interests that the stock market and economy both go sour this year and NOT spring back. If the stock market remains in status quo vertical position, then the Democrats will win by a huge majority, probably the Senate and the House
this time."
Farfel,
While I agree your logic makes sense, recent history suggests the Republicans are operating under a completely ass-backward logic! They have had ample opportunities to slam dunk Clintoon and AlphaGore on a whole range of issues, and they have not. Either they have been paralyzed into complete inactivity by fear of bad press, or they're no different than Democrats. Either way, they're useless. As I suggested to Sir Townie last week, don't expect any help from "W". If you do, I have some swampland I'll sell you....
Hate to be redundant, but your comments go back to the 1900 double eagle that I carry in my pocket, as a reminder of how a paper currency can be debased.
In 1971, (when Nixon and company heisted the world and took us off the gold standard) a paper dollar went to about 13 cents of its 1900 value. A 1971 paper dollar is worth about 15 cents today. So the true value of paper vs. gold is pretty obvious, as the paper is virtually nothing more than paper.
Of course my new era friends would tell me about how that paper dollar in 1900 could have been invested all so well, in the dot coms. of the times. But we won't go into all that.
Sir beesting- Really chuckle every time I see your handle. I live in a cedar log cabin, which is supposedly great for repeling insects, but also a great attractant for wasps. They take up residence each fall, and spend the winter. Fire up the woodstove, heat up the house, wake up the bees. Usually get your "handle" a few times each year! Heck of a way to wake up at night when I roll over on your brethren!
Thanks, TC, for setting me straight. See? I can't even get it right about always getting it wrong!
Seems I remember seeing the Corrigan/football angle on some TV half-time blurb when I was 14 or so, but probably just the product of a twisted memory aging badly. I also recall something about the flier. Sounds like my kinda citizen.
Isn't it amazing we also now have a Federal Reserve Governor (?) (New York?), Gerald Corrigan? That's kept the name fresh in my mind in recent months.
Sitting across the kitchen table from some tax clients last night, looking over all the overblown mutual fund names on their 401-K printouts, and their blank faces when asked what was in all those funds. I think I got them to consider switching to Treasury Direct by insisting they ask their "Investment Advisor" about the 0% stock returns from 1929-1954 and 1966-1982. I hammered on NASDAQ's 250 P/E ratio and Microsoft's fraudulent accounting. I'm sure they'll hear many reassuring words in reply from him/her.
Gold? Didn't even try. I'm not sure I want to be identified as "that guy who tried to get us to buy gold" if they're not really gonna get it. I'm still recovering from being "the guy who warned them about Y2k" a year ago. I kept those conversations pretty mild, and mostly kept my silence. Gold is even more threatening, and people need some pretty specific steps away from belief in "the System" before they'd think you were anything but a kook for recommending gold.
I can see the dilemma of the Wall Street types who know it's a rational investment to make on risk/reward fundamentals. But why open your mouth when a propaganda freight train is gonna run right over you. Even they have to wait for the public's anti-gold hypnosis to break.
1. Gold showed inverse sensetivity to the shock market, a new and improved awareness has finally arrived.
2. External forces are at work beyond the manipulators controls. Pressure on the dollar is building.
A. Japan's national debt is rising fast and they will at some point be forced to sell their US bonds to promote real growth as their "pump priming" methods are failing. Japan will see inter-Asian trade as the only alternative to the saturated product markets in the US. The US will be seen as a shrinking market and a resource colony. Mori-san is the man who can say "No", that is why he was chosen. There are no elections in Japan. Positions are filled with appointees then the vote is used to confirm who they chose. How many fish can he get to swim in his direction. Kind of like in America only ours talk alot more.
B. The European Central Banks want the Euro to be fully acceptable in exchange for Arab oil. If the Arabs decide to accept Euros on a large scale for their oil then for all practical purposes the Euro is as good as the Dollar. ECBs want European debt written in Euros and not dollars. That shift is real.
C. Latin American countries don't want their currencies replaced by the dollar because they have no sound method of collecting taxes. That is why they inflate. An inflation rate of 33% puts everyone in the 33% tax bracket. With zero inflation the governments go broke. So the wishful dreaming that Pax-Americana is going to sweep over Latin America and give a new home for big float is going to be a lot more difficult than the big boys think.
D. We see investors chasing after companies with real earnings, this means a continued slide and cascade down for all companies with faulty numbers. The whole de-emphasis of P/E ratios that prevailed to rationalize in insane valuations is now being brought to the light. Most of the tech stocks that are rallying on low volumes are held by weak hands quick to sell. The whole "quest for value" emphasis will lead people to continue selling into rallies and is the absolute opposite mindset of momentum investing. The Warren Buffet winning investor mentality is not buying into any of these sucker's rallies in the stratosphere. He started out as a fundamental pennystock investor. The trend to his reasoning would precipitate another wave down alot meaner than the last mini-crash. The way people say "You mean that was the big crash?" that is the master deception of the innocents. When insider selling continues unabated, you have most of the market going into distribution. After the last sucker has bought and the big boys are way short, they usually save large blocks of stock to dump suddenly to force a panic so their short positions go well into the money. When the big whales fight it's the little shrimp that get hurt.
E. Treasury Bill pattern shows a high extended handle. Either Treasuries will continue on up and top out later or they could rise slow and the high handle fails suddenly when the yen rallies. Gold would start cooking with a pan and handle failure in treasuries.
3. If gold isn't your game you could drool over the fundamentals of silver. Just don't foam at the mouth outside your residence. Lest they come to take you away, away. They don't want to confiscate the gold, actually with the way we think, they want to confiscate the goldbugs.
Bill Gates despises investments in computer crap. He owns 10% of PAAS. Newport News Ship........he's into the antithesis of the flakey computerworld he helped create. But in all seriousness, Timmy Leary had a brother named Reely Leary who ran away to Russia in the 60's and got scientific enough to draw up a mining plan and later on bilked a few greedy international investors out of millions and billions to start up the old mine in the tundra. "But Igor if we threaten to cut off their food they can get on the train. These free people are no good. We need prisoners who cannot leave so easy. Yes, but the prisoners we get cannot be so easily trained.
If we want the free people to stay then we have to make them happy and there is not enough vodka for them and for us too. We can trade palladium for vodka but we need alot of vodka first to open up the mine. Do you see my problem Igor? Drunk miners break the tips of the jackhammers. Prisoners were good when we had them but now we have to pay the workers and this &*%#@! democracy confuses me. Waving a gun around in the air with a 30 cent bullet used to get alot of ore in the cars.
My point was don't think playing silver stocks has the same viable unison with the price of silver when the silver mining companies are hyping their Russian mining operations that may move the first backhoe in 2010. Ashanti had a financial "tunnel collapse". Bankers stole the gold before it was even mined. Embezzled funds or railcars of ore sent to another refinery is not beyond the scope of the worlds smartest criminals.
"There must be 50 Ways to Close Down the Silver Mining Company" Hop on the bus Guss, They're drawning a new plan Stan. They got a new key Lee. Just listen to me.
"If the price of silver had merely gone up 12 cents on average we would have kept the mine open and made 3 million profit, but since it didn't stay up the 12 cents we decide to spend the money for mine development on further exploration drilling so we could float some more loans if we can find more ore because we really needed a sustained 25 cent rise in the price of silver to make a profit because we high graded the samples we floated the first loans on. So we are happy drilling more holes on the earth at every conceivable angle to draw this thing out to keep "my main guys" employed who are the only ones I can find who know anything in this decimated industry.
Queen's investment in dot.com
soars in value when trading starts
ALAN COWELL
NEW YORK TIMES
LONDON -- With regal insouciance, Britain's Queen Elizabeth II rode this
week's dot.com roller-coaster, held on to her stake and emerged as one of
her land's newest Internet millionaires Friday when an Internet company she
backed went public.
Her $160,000, 1.5 percent stake in Getmapping.com PLC soared in paper
value to beyond $1.56 million -- just shy of 1 million pounds -- when the
company began trading on the Alternative Investment Market with an initial
offer price of $3.20.
The queen chose to invest in the company after it -- which plans to
produce the first full aerial map of her realm -- was permitted to dedicate to
her replicas of the Domesday Book, ordered by William the Conqueror
around 1086 as a survey of all the lands in England.
It is, of course, not quite the accepted thing to discuss Her Majesty's
wealth. "The position as far as this is concerned is that we never give details of
the queen's portfolio because it would lead to commercial endorsement," said
Penny Russell-Smith, a Buckingham Palace spokesman.
Getmapping.com says it has so far mapped 85 percent of Britain and plans
to make a profit by selling aerial maps to real estate companies and local
government offices. It also wants to create three-dimensional games that will
permit Internet users to simulate a flight around Britain. It plans to use the
proceeds from its share offering to develop its Web site and start aerial
mapping of other countries.
[Thanks to ARKANSAS DEMOCRAT-GAZETTE, Fair Use for
Educational/Research Purposes Only]
New York--Apr 7--The US Defense Logistics Agency said Friday that the quantity of platinum authorized for sale under the fiscal year 2000 annual materials plan has been exhausted. The DLA has also exhausted sales of palladium for fiscal year 2000. DLA was authorized to sell 125,000 ounces of platinum and 200,000 ounces of palladium for fiscal year 2000. (Story .18428)
Black Blade: Yep, another source of PGM's no longer available to the market. Russia is all talk - no action, but can't deliver. Their stockpiles are depleted, I don't care what CPM Group says, it's gone!
Truly, if a man can actually buy the equivalent of a silver dollar a day 7 x $5 = $35, after servicing all his debt and expense obligations load, he is actually in the black so to speak.
An individual today must not only service the largesse of or beloved govt with his paycheck, but also his own. The popular theme I recall when I was a kid was that it was good to have a mortgage because then you got a break from the govt tax rate and besides inflation was rampant so you can pay back your debt with inflated dollars. At 3% a year interest rates on a mortgage loan that almost made sense.
These days after the govt takes their cut, the average working guy must service the debt on his home and vehicles as well. Then there is money he is supposed to put aside for the kids ever escalating college costs and the amount he is supposed to put away for retirement which the govt will just take later anyway. Then there are the state and local taxes on whatever you have been prudent enough to place upon their radar screen. Oh yeah and then there is the food, water, electricity. Oops, don't forget life insurance so that if you stop running the race suddenly the family will have a small window of opportunity to come up to speed and replace you. State mandated car insurance is a biggie. Wouldn't want anyone to sue you for everything you don't really have. And then Health Care insurance. If the company is not starting to take that out of your pay or if you were insightful enough to fancy yourself an entrepeneur and own your own company...this is a major expense item. Home Insurance? Geez
How many today, after all those deductions for the trappings of today, can say they are in the black. Did you not put that deposit up for the kids college fund this week?
Have you forgone the expense of life insurance? Or did you not pay that credit card balance because you had to use the money for the car payment or grocery bill? You my friend are now in the red...better ask for a raise.
Can a man of the present or future remove himself from this self induced slavery? Do you really need health care insurance? Most people don't think about this because it is a company benefit. If you really got sick and could not pay your bill do you think you will die? Guess again...there is a government program hiding somewhere that will guarantee you adequate care to keep you alive and servicing the collective debt. In many cases you will receive more comprehensive care since the billing is easier than for the hospital to try and get the money from an HMO.
I'm guessing medical costs would get a quick dose of reality if medical insurance was suddenly outlawed.
CM comment: The singular constant feature of international monetary policy is change/evolution. It is not unreasonable to conclude that we are living in a day and age when we might see additional evolution in real time.
Henri says:
species evolution = time revolution/evolution
Only a change of perception is needed to evolve. Time is an illusion mostly fueled by the drive to produce money. If money were real again people would have more "time" to do the things that are important like find ways to get along with each other and clean up the mess we made instead of trying to scheme ways to rip each other off. Yes it will still take 1 day for the world to rotate but we will not need to be so preoccupied with what we need to get done in a day. That will allow evolution to follow its natural course.
http://www.usagold.comChief market analyst for Merrill Lynch........Richard McCabe says he doesn't see enough pessimism in the market for that mini-crash to represent a true bottom and the market may rollover and test that bottom again. After that if volume is lower and panic selling is exhausted then we have a basis for whatever for two months or so. POG could spike up again with that retest.
Why a bear trend down for stocks has been established:
Here is my question. If I walked up to your door and offered you $4,000 more than what your car is presently worth. What would you do? You might say let me talk it over with my wife. Then you would both say I was an idiot and you could simply buy a better car later with the extra $4,000 . So you 'd come back and say "Sure the car is yours". With the cash in hand you would feel really smart. You loved that car but you just know there are better deals waiting for anyone with cash in hand.
Exactly that is why good stocks will go down. Not because there is unbelief in their fundamentals or earnings potential, but because there is a better than 60% chance of the same stocks falling to be repurchased cheaper in the future. The race now is for cash in hand. Why? Because so many stocks now are so cheap. Why stay with an inflated priced tech stock when this other stock just got hammered down and is now at a true bargain price and its fundamentals are just as good. Fund managers are switching to "Only buy stuff when it's on sale". "Wait for the sale, it's coming". "Buy when you see the blinking blue light". WELL, IF IT ISN'T GOING UP GET RID OF IT. That is what they are telling each other behind the scenes. You can feel it watching all the medium-large block sell orders going down. They don't want to spook this reprieve rally until they unload more. The whole tech market just went on sale. But....the biotech was even racing up at higher percentages and they went on sale two weeks ago. What gives???? So what?? Well this is what gives. Alot of these companies know they are going to miss numbers. Insider selling is what is collapsing the stock market. And the Fed cannot really support the stock market when panic selling takes over. There won't be a reprieve rally for most of these secondary companies. Stale longs will sell anyway and take their losses. So as the blue-chip techs go off in the next rally the secondary junk is going to miss the ride and get even cheaper. Finally the leaders get sold off and momentum dies. Momentum players turning into bottom fishers. Sector rotation turns into moving the "For Sale" sign to another sector. Finally some Warton School Phd says,"Hey, I think we've been in a bear market since January, look at the slope of these graphs. It only goes up if I turn the paper like this. This could be a major trend reversal, naaa too early to tell. Wait one more week.........." What happens when major investment houses go into cash? They need a place to put it. If the treasuries get sold off, and money flows back into stocks, will the same stocks be bought back driving them back to insane P/E ratios? OR will the money trickle on back with the bottom fishing in Biotech or basic materials industries, or whatever. It's going to trickle back into totally different areas long neglected with VALUE. So my point is that Tech is finished as a whole. This effects gold. The hopes of stale longs to get out even are going to evaporate and pessimism and gloom is going to set in. We were deceived? Or did they deceive themselves listening to lying analysts? Bottom fishing and tech stuff going down or sideways means a weaker dollar due to a lack of confidence and the mystery of gross overvaluations has not been resolved. Weak dollar means stronger gold.
As for gold and the POG, we know that an ailing stock market capped by insider selling is going to add fear and sap the dollar. It took 10 Billion Dollars worth of Yen injection to scare shorts into covering on the crash day to start the rally back up. Somebody correct me if I'm wrong. So time is on gold's side. They can all sleep so well shorting down the POG when no one wants it. Only a two pronged attack can keep gold down. Propoganda and massive shorting. The propoganda machine is failing. Do you really think investors believe all they hear? We are so used to being lied to that people use the financial news as a reverse barometer. Or else anyone with any money left does. So the more they slam gold with negative articles the more savy traders want to buy in. Greenspan couldn't crash the market before when he wanted to and he can't successfully support it when he might want to in the future. Markets are more powerful than governments.
The after-hours trading book available on Island ECN to be seen by all means extreme volatility is here to stay. The market makers on the NYSE would argue their wide spreads were justified because they eat stock in a falling market and take on ulcers providing liquidity when there is none. Everyone thinks the NYSE market makers are the lepers in the caves, unclean and not to be touched. Well when it "ALL goes electronic" and there are no market makers only thousands of independent traders posting bids and asks like Ebay for stocks, then liquidity can dry up in minutes and panics in individual stocks can occur with no one to give a whim of care to dampen. When the human market maker spreads the bid and ask or moves it up slow. That is necessary human involvement. Sure there is greed and sleaze and manipulation, but you are alot better off with old world style liquidity providers than the new boys in town ready to turn all stock markets into pure auctions with no human interacting element to calm a panic or cap an insane rally. So my point is that all my idealism of the noble NYSE market maker is a pipe dream on a wave that won't arrive because the Island ECN guys are the newer better gotta have its going to provide it. Low commission trades are the norm now. Brokers running to start their financial websites. It's the implosion of the window watchers. See all those tiny cars and people like ants down there? Well broker if you loose one more top client then you're going to become one of those little ants down there. We are headed for all the speed of the fast food drive through with the low quality sick-food feeling of living in an investment world full of anxiety and tension. Insomnia alone is enough to drive anyone to buy gold. I never mentioned the insomnia factor. Take three kruggerands and call me in the morning. Wow, I even feel better. The popular use of the limit order is death to the NYSE and the old market maker system. The concept of "no sold order flow" has them scared like roaches running for cover. Like free internet service I just set up. AOL is finished pal. They can give out CD-roms with 1000 free hours and can't compete with the clear connection I have with freewwwebb.com. I can buy an ounce of gold using the savings from the free ISP.
Anyway to end my book here, the Young Turks at Island ECN are laying seige to the NYSE castle. The pompous fellows on the castle walls laugh at the contraption they use for the siege, but they can't see all the tunnels being dug under the grainaries and soon the siege will hasten to a close with the castle surrendering without a fight because they got starved out alot faster than they thought. Afterhours trading is not used by most investors except to monitor their stocks. And their watching turns into an addiction that needs to be fed. Once they actually place their first afterhours trade and it fills at their price.......Its over for NYSE. New and old companies will not want to be listed on NYSE with alot more traders becoming Nasdaq-only guys. Liquidity is becoming history for alot of paper. That means people get scared of stocks and they will not sit in cash forever. Gold is going to get popular once the liquidity crisis becomes fullblown with the trader's gravitation to fast-food stock ECNs. "Look honey for our stock the price just moved down and there are 357 orders to sell and 15 orders to buy 2 1/2 points below the market, What will happen tomarrow morning I wonder?"
What we saw on Tuesday was that dead cats really can bounce when thrown onto a floor covered with 10 billion yen.
I'm not saying all this because I want to scare people. I want to warn people about the pirates on Wallstreet who carefully rig markets and dump massive quantities of stock while they tell others to buy, buy, and buy somemore. They wave the friendly Union Jack for buying when they are in a minute going to change to the Jolly Roger and attack the same people they sold to. Happens everyday.
Yes, this topic is a day or two old but it was the one that prompted me to get a password and had to wait a day to chime in.
First, thank you to CPM for the excellent service. And thank you to Trail Guide, Town Crier, et. al. for the interesting and informative dialog.
Yes it seems illegal gold, as with other banned substances would render an inflated black market value. I thought it might be of interest to those who are not familiar with the banned substance market to know that premium marijuana trades considerably higher than the current POG. $400/oz. is typical. I would love to see this tracked in the commodities charts. Waging war on a plant - what an utter failure and a very unfunny joke.
Of course, illegal drugs are necessary to fund the black budgets of the "coke & dagger" boys. Fly below the radar folks.
What if there is a two stage rocket? (silver then gold)
We all know a wide variety of events will cause a movement in the price of gold. The consensus is that is will take a true crash and/or a fall in the value in the dollar to start gold on a ride to a much higher level.
We all know there is a running deficit of silver. Once the surplus is over the price has to rise.
Timing is everything. What if the PPT et al. manage to keep the stock market/dollar up and the POG down; while silver starts exploding.
I know that if the price of silver goes up, it will affect the silver shorts, which may cause some financial hardships. But it is doubtful that this blow up in silver will capture the market's attention. It will be a "minor" sideshow for a time.
Lets say you have $50,000 invested in gold and $50,000 in silver. If the price of silver spikes to $50-100 and ounce, it may be possible to trade your silver for a lot of gold. I will let you do the math.
Work fast. Take physical delivery.
Wait 2-5 years for all the debt bubbles to be expelled from the economy. With luck you can invest in the stock market during the "real" recovery (not one of the false recoveries that will separate may from their money).
Having Sami Native blood corsing through my veins, I'm drawn to the Native people of this land we call America, and their acknowledgment of the Coyote. A creature they call the Trickster. For the Coyote is stealth like the night, he lives among us in our cities, fields, and markets. He is the one with the golden eye....he is us. When hungry, as is his constant lot in life, he seeks nourishment, which can only be fraught through the reality of life which exists by energy and work.
Badminton Games
In our midst, we have the badminton game and the birdie. It seems to be a birdie of gold to those on the sidelines watching the game. Actually the game has many arenas, which some call markets. Supposedly markets of nourishment, but actually markets of time and space and paper. As Sir Henri so aptly alluded today; time is but an illusion. One which markets depend upon for their existence. Contract dates, expiration dates, longwave dates, young lovers on dates, etc. etc. etc.
The players on the badminton court as well as the gallery on each side rooting for their player, all want the false birdie of gold to go in a direction of their liking. Long this volley, short that stroke, but please make it on the time line I desire so as I can make tea, which is at an assigned time by me.
Little do they see the space between the places where they think the birdie should be, and where the real birdie is today. For the real birdie is only for the golden eye of the Trickster to see.
The Trickster is us, and we have stolen the birdie.
You said:
"We all know there is a running deficit of silver. Once the surplus is over the price has to rise."
Yes, and that rise would likely be extraordinarily substantial - to $100+/oz at the peak. During the last most recent minor rallys, the most recent of which was initiated with last Tuesday's "mini crash", silver was seen to mirror gold's moves. This is a pattern broken from last September when, momentarily gold got away from "them", but silver did not. I don't know (who does?) whether this most recent mirror behavior between the two metals is a "new" recent pattern or not, but it is at least favourable, and may indicate that the supply problems are becoming a worry.
My problem in all this is what to do when the market goes "underground". I have no doubt in my mind that COMEX will follow the strategy shown when palladium ran out of above ground supplies in Tokyo. A "TOCOM" by COMEX will most assuredly follow when silver supplies are depleted. But ask yourself whether the palladium price per ounce is a real price or the paper price? I think it represents the paper price and palladium (and platinum, for that matter) sells for a much higher price "under the table" to physical delivery buyers than it does in the paper market. So the paper market is window dressing, yes, and represents a physical buy only "if" the metal(s) become available some time in the future. The paper is severely discounted.
So the real problem as I see it is 1) finding out the true price of the silver when one sells ones physical silver, and 2)where "the table" is located under which these transactions occur.
I think that at some point in the future, "dislocations", a core contingent of common stocks could well advance with the price of gold. Important franchises like Johnson&Johnson, Quaker Oats, etc., etc., etc., who have ongoing money making business plans could be viewed as a money substitute like stocks were in Germany in the 1930's hyper-inflation. I think in this period coming it's all the paper assets that are really just IOU'S are whats going to CRASH. People may want to hold Johnson&Johnson "money", rather than hyper-inflating bank money.
Of course it probably will be best to take no chances and stick to the real wealth money - GOLD.
http://www.usagold.com/halloffame.htmlfor those who missed yesterday's announcement that the Hall has received its overdue facelift, and also an expanded index to include the latest round of entries.
Excellent reading material to "recharge your gold batteries" over the weekend.
On December 8, 1999, the International Monetary Fund's (IMF) Executive Board adopted a decision authorizing off-market gold sales by the IMF of up to 14 million troy ounces, in order to generate the equivalent of SDR 2.226 billion (about US$3 billion) to help finance the IMF's contribution to debt relief and financial support for the world's poorest nations (see News Brief No. 99/62 and No. 99/57).
IMF Treasurer Eduard Brau announced today that this target was accomplished through seven off-market transactions conducted with Brazil and Mexico over the period December�14, 1999 through April 5, 2000. A total of 12.944 million troy ounces of gold, equivalent to SDR 2.680 billion, were sold and accepted back immediately at the same price, in settlement of these members' obligations to the IMF. Thus, the gold sold by the IMF did not enter the market.
In accordance with the IMF's Articles of Agreement, the IMF retained the book value of the gold, equivalent to SDR 35 (about US$47) per troy ounce, on its own account. The remainder of the proceeds, equivalent to SDR 2.226 billion were invested to generate income for the Heavily Indebted Poor Countries (HIPC) Initiative.
"We appreciate the cooperation of the Brazilian and Mexican authorities in the execution of these transactions," Mr. Brau stated, "which represent a major step toward funding the IMF's contribution to the HIPC Initiative."
Here's what Reuters had to say on the IMF gold operation...
http://biz.yahoo.com/rf/000407/02.htmlBy selling the gold at market prices and then accepting immediately back for payment, Reuters says "the deal creates windfall profits for the IMF because, under a quirk of international finances, IMF gold is valued at some $48 per ounce, while the market price is around $283."
Yep. Government agencies LOVE windfall profits. Some might say such "easy money" addictive.
Can you see how all governments might come to use such a scheme to generate the means to fund programs while at the same time putting a meaningful floor of gold under their currency?
TC -- Thanks for the HOF tip-off. I don't go there often enough, and FOA was at his Supreme Bestest that week, wasn't he? I don't know why I missed it during January...
White Rose -- are you be-handled after the students in Germany who resisted Hitler -- Hans and Sophie Scholl and Christoph Probst -- and paid with their lives? If so, then you have chosen the noblest name amongst us all.
http://biz.yahoo.com/rf/000407/4i.htmlNo manipulation on behalf of the currency's exchange rate.
Think of the eventual unwinding of this with the same nonintervention policy. To wit, where would we be without Japan's very accommodative policy facilitating the unwinding of the yen carry...and even at that they struggle to keep the yen from burrying the dollar.
More astonishing info detailing the apparent malfeasance of the Clinton administration and the infamous ESF fund, seemingly utilized for the suppression of the gold price from '96 until today WITHOUT REQUIRED CONGRESSIONAL APPROVAL!
I have lurked year for over a year before posting. I noticed many names with all kind of references. I chose a name that reflected youthful and futile resistance to that status quo that was everywhere.
This is not to suggest that our goals are so noble (or so futile). But occasionally we must be reminded that some who face terrible odds have paid dearly.
http://www.egroups.com/message/gata/432?☆t=403Reg Howe examines the data available about the
Exchange Stabilization Fund and concludes that
it matches a scheme to suppress the price of
gold.
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:
Putting Two and Two together on the IMF gold operations...
From TownCrier (4/8/2000; 16:09 - Msg ID:28317):
>>>>>Here's what Reuters had to say ... "the deal creates windfall profits for the IMF because...IMF gold is valued at some $48 per ounce, while the market price is around $283."
Yep. Government agencies LOVE windfall profits. Some might say such "easy money" addictive.
Can you see how all governments might come to use such a scheme...<<<<<
While we all agree that the gold derivative markets are used as a means to suppress the price (and apparent value) of gold to reap the attendant benefits of the dollar duly "strengthened" thereby, the day approaches wherein the institutional benefits will be greater to let gold run.
Get yours while the getting is good...at the give-away prices, that is. (The "getting of gold" is always "good"!)
The Newspaper "FINANZ und WIRTSCHAFT", dated April 8 2000,
states in an article by Mr.Peter Kuster regarding the (SNB) Swiss National Bank income for 1999 that the SNB has Gold
and income from Gold-LEASING in the amount of 11.7 Billion
(SFR) Swiss Franks at a value of SFR 4595.74 Per Kilo of Gold--aprox. 1/3 of market value.
I would like to write a few pointy questions to Mr.Jean
Pierre Roth, Vice-President of the SNB.
I need the help of the brilliant minds in this Forum to fashion these questions. Gold sale,why now? Why at these low prices? What is going on with Gold-Leasing through the Swiss National Bank? I probably will also post these questions in an open letter to the SNB in a Newspaper ad. The questions must be simple, but penetrate the clouded minds of the swiss people. The general feeling in the street(personal survey), is that Gold has no purpose or value, that all is well, everything is good, and the value of the Swiss franc is retained because everybody loves us.
So you see, delusion is not only a dot.com phenomena.
Copy to: Gata,Le Metropole Cafe,Peter Kuster View
Yesterday's Discussion.
Wilford Krug wrote. Gold, it is, "one of the most beautiful of the ninety-two elements and one of the heaviest metals known to science. It is the only metal that is yellow in it's natural state. It does not tarnish when exposed to air and does not rust when buried in the ground. It always retains its particular beauty,color and lustre. It is the most ductible and malleable of the metals. A troy ounce can be drawn into a fine wire 50 miles long or it can be beaten into a thin film which will cover 100 sqware feet--over a thousand times thinner than normal paper. Gold is virtually insoluble and proof against nature's reagents. It is inert to most acids and bases. Its refusal to disintegrate,rust or tarnish has resulted in its being regarded as something that can be counted on to look the same and feel the same a century or five centuries ahead. Gold is permanent Money. This is the undeniable Truth that has come down from pre-history until even now. It is the King of the 92 known elements that exist. All we can know for sure is that Existance --- Exists.
There is a request from Peter Asher for the story behind "White Rose". I have the sketchy memory of a group of German Christian youth who oppossed the Nazis. They wrote and distributed pamphlets in Munich. They used the name "White Rose". They were caught, tortured, and executed.
I did a search for White Rose on Amazon.com and find this book: The White Rose : Munich 1942-1943 by Inge Scholl, Dorothee Solle
Here is one reader's review:
A call to conscience from 1942, Nazi Germany.
Reviewer: JOYCE J. KATZBERG from Providence, Rhode Island
As a Jewish child growing up, I often heard the horror storiesof those who collaborated with Hitler and the National Socialist agenda. It wasn't until much later in life that I began to hear about those who resisted. This book, written by the surviving sister of two such
resisters, gives us a compelling account of the stories of a small group calling itself the White Rose consisting of students, soldiers and teachers who examined their consciences and engaged in rebellious activity.
Included here are the texts of many of the leaflets distributed by the White Rose. One wonders how modern readers would relate to such eloquence that draws from the poetry of Goette and other sources utilizing vocabulary beyond what is common in our dumbed down intitutions.
Ms. Solle's introduction to this book provides a context in which we might examine our own complicity with modern structures of annihilation.
I would highly recommend this book as text for classes in social or political history.
If the purpose of education is to encourage us to examine our contexts and choices, this book is an imperitive read.
(Other reviewers took this particular book to task for being based on the memories of the author which are not historically accurate; other books are recommended. These other books may be out of print.)
Those looking for more should search using the following terms: White Rose (Resistance group); Weisse Rose (Resistance group); Scholl family; Universitat Munchen Riot 1943; Anti-Nazi movement.
IronHead Coyotes 28309 and debt currency vs fiat vs real money
real money...gold bears no interest and hence is timeless in its value. It cannot be created, only recovered. It cannot be or destroyed except by nuclear transformation (difficult and expensive). It does not oxidize easily (I did not think it could oxide at all but on that I defer to Zenidea). It can be debased, but can also be rebased. When used as a proxy for the exchange of goods, the value of the gold itself is independent of the value of those real goods. It retains its proxy of value by agreement between men that gold itself is an honest medium of exchange. When we speak of the "market" value of gold we speak nonsense! To speak thusly is to attempt to attach to gold a time characteristic. This is a characteristic of contracts of debt and repayment, not of gold.
A debt currency must expand. Because to survive, it must reproduce itself by the time essential process called interest. When it is created faster than it is destroyed, its function as money ceases and its purpose as deception and debasement begins. That is not to say a debt currency has no value. Indeed, it has value by popular agreement that time is money os that it assumes the value attributed to time. Of what value is the promise of another? In a society of values and family based integrity and honor, the promise of another holds great value. Of what value is a promise in a society with no integrity, with no honor, with no families. When the inmates take over the asylum the coyotes can only survive by their stealth.
A fiat currency on the other hand represents nothing and is backed by nothing other than the agreement of men to hold it as a token of exchange...not unlike gold. But definitely unlike a debt currency. A debt currency is an instrument of common law and its value may be enforced by rule of law...wherein we find the indispensibility of government to uphold such commercial law and lawyers to explain to us how in reality laws are just suggestions.
The destruction of the perception of gold as money is driven by governments whose very existence is challenged by honesty among men and theives alike, family integrity and values of exchange judged between men (individuals) not by jurisprudence. That is value attached to transactions that do not engage "legal tender". Outlaw transactions.
Gold only appears to be timeless wealth...but only by the common agreement between men irrespective of their countries of origin despite their governances (self-inflicted or inflicted in general)attempts to detroy this idea. The gold itself, to be sure, is only a token of exchange which in the hearts of men represents honesty. Accumulations of gold are considered to be timeless wealth since they represent a family based work ethic and integrity that in tough times allows them the luxury of continuing to thrive. It is the accumulated savings of generations passed on to those with the same values and integrity. It is dispersed in the name of charity to those in need but who are deserving by acknowledgement of those same work ethic principles. It is likewise dispersed in commerce. And is lost by fools when they lose such integrity and value. And of course by piracy. Piracy, is a capital (government) offense. It occurs when men take it upon themselves to releive government vessels of their cargo. Government has no business in the ownership of gold therefore the appropriation of gold from the government for dispersal to the people is a crime against government not against its governed. A pirate commits a crime against the people when he hoards or buries his lucre. A pirate therefore is popular when he spends freely with the local populace and will be protected by the same. Even the people will turn against a pirate who knows not wherefore his freedom is seated. The government of the US has become a popular pirate. Yet it is a "mock" pirate for it only disperses debt currency of its own creation. It is well into the final stages of its timeline wherein the people discover that there has been ongoing deception. That pirate is no better off than he who has buried his filthy lucre. This pirate has been stealing from the people. This pirate will hang at the hand of the people not by the power of government. That is common justice. Using the term pirate for such an entity is in fact a disservice to the noble piracy trade. This rogue and scoundrel (he who steals from the people on such a grand scale) can only be called by one name. "Government"
http://www.kitco.com/pda3992.htmlInteresting presentation from CPM Group. Contrast TOCOM default on Pd, and extrapolate to other PMs after reading this article. The emphasis is on Ag and PGMs.
The people is a beast of muddy brain
That knows not its own force, and therefore stands
Loaded with wood and stone; the powerless hands
Of a mere child guide it with bit and rein;
One kick would be enough to break the chain;
But the beast fears, and what the child demands,
It does; nor its own terror understands,
Confused and stupified by bugbears vain.
Most wonderful with its own hands it ties
And gags itself--gives itself death and war
For pence doled out by Kings from its own store
Its own are all things between earth and heaven;
But this it knows not; and if one arise
To tell this truth, it kills him unforgiven.
Thank you Black Blade for the citation of the poem "The People" it is profound.
The "time" that we have been allotted here in this place (earth at this point in its evolution) is a precious gift from God. It is meant to be used for the continued gathering of experience in interacting with other souls both alike and unlike ourselves. When we attach further meaning to this concept...this illusion we call "time", such as "time is money", we debase it as surely as adding copper to gold debases it.
When we come to the realization that we are all one, and that what we do to each other we do to ourselves, we can begin to see beyond the illusion. We are forgiven our trespass (only) as we forgive those who trespass upon us.
The mind is the seat of anger and loathing, the heart is the seat of love and kindness and those things of a spiritual nature. It was man himself, who took it upon his own mind to presume to be the master of his destiny. Our anger arises in our minds when we are defeated in this purpose. Our will is defeated when it is contrary to the "will" of God...that which IS...the ultimate truth. We are sucessful in the long run only when our purpose is harmoniuos with the ultimate truth...the "will" of God. Our mind confuses us. It is the curse of the "forbidden fruit of the Tree of Knowledge". That we would think ourselves as something unique and different from God was the first blaspheme that ejected us from the "Garden of Eden".
Those that see beyond the illusion of self, of time, see that there is heaven right here on earth and find happiness in the harmony. That which angers others affects them not.
We face bankruptcy and hyperinflation because in nature and physics there can be no perpetual motion machines. Fractional Reserve banking and Fiat attempt this feat but as in every scheme of this nature, it is doomed to within a timeline.
The Second Law Of Thermodynamics, fundamentaly is this:....
"An isolated material system never passes through the same state twice. Each state decreases the available energy". In short, there can be no perpetual motion.
My take on this is that Fiat expands so as to never be able to satisfy settlement of its debted creation and further, its value must decrease in available energy of what it can obtain of physical materials. Its issuance can theoreticaly be infinite, but what it can purchase is not.
The following is the preface to a February 1982 study by Congress on the Second Amendment. Note that this is an official report by a Congressional Subcommittee. This report points out that 1)the right to keep and bear arms is a natural right and is only guaranteed and not created by the Constitution; 2)the reason the 14th Amendment doesn't pass it along to the states is because the 14th Amendment only deals with rights that were created by the Constitution, which would infer that natural rights pass along to the States by virtue of their being natural; 3) keeping and bearing arms is essential to a free society; 4)(my conclusion) any attempt to disarm America by limiting the supply of ammunition or weapons at the source or manufacturer or by laws requiring registrations is unconstituional and unpatriotic and weakens America's fabric, which makes it questionably treasoness.
PREFACE
"To preserve liberty, it is essential that the whole body of the people always possess arms, and be taught alike, especially when young, how to use them." (Richard Henry Lee, Virginia delegate to the Continental Congress, initiator of the Declaration of Independence, and member of the first Senate, which passed the Bill of Rights.)
"The great object is that every man be armed . . . Everyone who is able may have a gun." (Patrick Henry, in the Virginia Convention on the ratification of the Constitution.)
"The advantage of being armed . . . the Americans possess over the people of all other nations . . . Notwithstanding the military establishments in the several Kingdoms of Europe, which are carried as far as the public resources will bear, the governments are afraid to trust the people with arms." (James Madison, author of the Bill of Rights, in his Federalist Paper No. 46.)
"A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear arms, shall not be infringed." (Second Amendment to the Constitution.)
In my studies as an attorney and as a United States Senator, I have constantly been amazed by the indifference or even hostility shown the Second Amendment by courts, legislatures, and commentators. James Madison would be startled to hear that his recognition of a right to keep and bear arms, which passed the House by a voice vote without objection and hardly a debate, has since been construed in but a single, and most ambiguous Supreme Court decision, whereas his proposals for freedom of religion, which he made reluctantly out of fear that they would be rejected or narrowed beyond use, and those for freedom of assembly, which passed only after a lengthy and bitter debate, are the subject of scores of detailed and favorable decisions. Thomas Jefferson, who kept a veritable armory of pistols, rifles and shotguns at Monticello, and advised his nephew to forsake other sports in favor of hunting, would be astounded to hear supposed civil libertarians claim firearm ownership should be restricted. Samuel Adams, a handgun owner who pressed for an amendment stating that the "Constitution shall never be construed . . . to prevent the people of the United States who are peaceable citizens from keeping their own arms," would be shocked to hear that his native state today imposes a year's sentence, without probation or parole, for carrying a firearm without a police permit.
This is not to imply that courts have totally ignored the impact of the Second Amendment in the Bill of Rights. No fewer than twenty-one decisions by the courts of our states have recognized an individual right to keep and bear arms, and a majority of these have not only recognized the right but invalidated laws or regulations which abridged it. Yet in all too many instances, courts or commentators have sought, for reasons only tangentially related to constitutional history, to construe this right out of existence. They argue that the Second Amendment's words "right of the people" mean "a right of the state" � apparently overlooking the impact of those same words when used in the First and Fourth Amendments. The "right of the people" to assemble or to be free from unreasonable searches and seizures is not contested as an individual guarantee. Still they ignore consistency and claim that the right to "bear arms" relates only to military uses. This not only violates a consistent constitutional reading of "right of the people" but also ignores that the second amendment protects a right to "keep" arms. These commentators contend instead that the amendment's preamble regarding the necessity of a "well regulated militia . . . to a free state" means that the right to keep and bear arms applies only to a National Guard. Such a reading fails to note that the Framers used the term "militia" to relate to every citizen capable of bearing arms, and that the Congress has established the present National Guard under its own power to raise armies, expressly stating that it was not doing so under its power to organize and arm the militia.
When the first Congress convened for the purpose of drafting a Bill of Rights, it delegated the task to James Madison. Madison did not write upon a blank tablet. Instead, he obtained a pamphlet listing the State proposals for a bill of rights and sought to produce a briefer version incorporating all the vital proposals of these. His purpose was to incorporate, not distinguish by technical changes, proposals such as that of the Pennsylvania minority, Sam Adams, or the New Hampshire delegates. Madison proposed among other rights that "That right of the people to keep and bear arms shall not be infringed; a well armed and well regulated militia being the best security of a free country; but no person religiously scrupulous of bearing arms shall be compelled to render military service in person." I n the House, this was initially modified so that the militia clause came before the proposal recognizing the right. The proposals for the Bill of Rights were then trimmed in the interests of brevity. The conscientious objector clause was removed following objections by Elbridge Gerry, who complained that future Congresses might abuse the exemption to excuse everyone from military service.
The proposal finally passed the House in its present form: "A well regulated militia, being necessary for the preservation of a free state, the right of the people to keep and bear arms shall not be infringed." In this form it was submitted into the Senate, which passed it the following day. The Senate in the process indicated its intent that the right be an individual one, for private purposes, by rejecting an amendment which would have limited the keeping and bearing of arms to bearing "For the common defense".
The earliest American constitutional commentators concurred in giving this broad reading to the amendment. When St. George Tucker, later Chief Justice of the Virginia Supreme Court, in 1803 published an edition of Blackstone annotated to American law, he followed Blackstone's citation of the right of the subject "of having arms suitable to their condition and degree, and such as are allowed by law" with a citation to the Second Amendment, "And this without any qualification as to their condition or degree, as is the case in the British government." William Rawle's "View of the Constitution" published in Philadelphia in 1825 noted that under the Second Amendment: "The prohibition is general. No clause in the Constitution could by a rule of construction be conceived to give to Congress a power to disarm the people. Such a flagitious attempt could only be made under some general pretense by a state legislature. But if in blind pursuit of inordinate power, either should attempt it, this amendment may be appealed to as a restraint on both." The Jefferson papers in the Library of Congress show that both Tucker and Rawle were friends of, and corresponded with, Thomas Jefferson. Their views are those of contemporaries of Jefferson, Madison and others, and are entitled to special weight. A few years later, Joseph Story in his "Commentaries on the Constitution" considered the right to keep and bear arms as "the palladium of the liberties of the republic", which deterred tyranny and enabled the citizenry at large to overthrow it should it come to pass.
Subsequent legislation in the second Congress likewise supports the interpretation of the Second Amendment that creates an individual right. In the Militia Act of 1792, the second Congress defined "militia of the United States" to include almost every free adult male in the United States. These persons were obligated by law to possess a firearm and a minimum supply of ammunition and military equipment. This statute, incidentally, remained in effect into the early years of the present century as a legal requirement of gun ownership for most of the population of the United States. There can by little doubt from this that when the Congress and the people spoke of a "militia", they had reference to the traditional concept of the entire populace capable of bearing arms, and not to any formal group such as what is today called the National Guard. The purpose was to create an armed citizenry, which the political theorists at the time considered essential to ward off tyranny. From this militia, appropriate measures might create a "well regulated militia" of individuals trained in their duties and responsibilities as citizens and owners of firearms.
If gun laws in fact worked, the sponsors of this type of legislation should have no difficulty drawing upon long lists of examples of crime rates reduced by such legislation. That they cannot do so after a century and a half of trying � that they must sweep under the rug the southern attempts at gun control in the 1870-1910 period, the northeastern attempts in the 1920-1939 period, the attempts at both Federal and State levels in 1965-1976 � establishes the repeated, complete and inevitable failure of gun laws to control serious crime.
Immediately upon assuming chairmanship of the Subcommittee on the Constitution, I sponsored the report which follows as an effort to study, rather than ignore, the history of the controversy over the right to keep and bear arms. Utilizing the research capabilities of the Subcommittee on the Constitution, the resources of the Library of Congress, and the assistance of constitutional scholars such as Mary Kaaren Jolly, Steven Halbrook, and David T. Hardy, the subcommittee has managed to uncover information on the right to keep and bear arms which documents quite clearly its status as a major individual right of American citizens. We did not guess at the purpose of the British 1689 Declaration of Rights; we located the Journals of the House of Commons and private notes of the Declaration's sponsors, now dead for two centuries. We did not make suppositions as to colonial interpretations of that Declaration's right to keep arms; we examined colonial newspapers which discussed it. We did not speculate as to the intent of the framers of the second amendment; we examined James Madison's drafts for it, his handwritten outlines of speeches upon the Bill of Rights, and discussions of the second amendment by early scholars who were personal friends of Madison, Jefferson, and Washington while these still lived. What the Subcommittee on the Constitution uncovered was clear � and long lost � proof that the second amendment to our Constitution was intended as an individual right of the American citizen to keep and carry arms in a peaceful manner, for protection of himself, his family, and his freedoms. The summary of our research and findings form the first portion of this report.
In the interest of fairness and the presentation of a complete picture, we also invited groups which were likely to oppose this recognition of freedoms to submit their views. The statements of two associations who replied are reproduced here following the report of the Subcommittee. The Subcommittee also invited statements by Messrs. Halbrook and Hardy, and by the National Rifle Association, whose statements likewise follow our report.
When I became chairman of the Subcommittee on the Constitution, I hoped that I would be able to assist in the protection of the constitutional rights of American citizens, rights which have too often been eroded in the belief that government could be relied upon for quick solutions to difficult problems.
Both as an American citizen and as a United States Senator I repudiate this view. I likewise repudiate the approach of those who believe to solve American problems you simply become something other than American. To my mind, the uniqueness of our free institutions, the fact that an American citizen can boast freedoms unknown in any other land, is all the more reason to resist any erosion of our individual rights. When our ancestors forged a land "conceived in liberty", they did so with musket and rifle. When they reacted to attempts to dissolve their free institutions, and established their identity as a free nation, they did so as a nation of armed freemen. When they sought to record forever a guarantee of their rights, they devoted one full amendment out of ten to nothing but the protection of their right to keep and bear arms against governmental interference. Under my chairmanship the Subcommittee on the Constitution will concern itself with a proper recognition of, and respect for, this right most valued by free men.
Orrin G. Hatch, Chairman
Subcommittee on the Constitution
January 20, 1982
Following adoption of the Fourteenth Amendment, however, the Supreme Court held that that Amendment's prohibition against states depriving any persons of their federal "privileges and immunities" was to be given a narrow construction. In particular, the "privileges and immunities" under the Constitution would refer only to those rights which were not felt to exist as a process of natural right, but which were created solely by the Constitution. These might refer to rights such as voting in federal elections and of interstate travel, which would clearly not exist except by virtue of the existence of a federal government and which could not be said to be "natural rights". 59 This paradoxically meant that the rights which most persons would accept as the most important � those flowing from concepts of natural justice � were devalued at the expense of more technical rights. Thus when individuals were charged with having deprived black citizens of their right to freedom of assembly and to keep and bear arms, by violently breaking up a peaceable assembly of black citizens, the Supreme Court in United States v. Cruikshank 60 held that no indictment could be properly brought since the right "of bearing arms for a lawful purpose" is "not a right granted by the Constitution. Neither is it in any manner dependent upon that instrument for its existence." Nor, in the view of the Court, was the right to peacefully assemble a right protected by the Fourteenth Amendment: "The right of the people peaceably to assemble for lawful purposes existed long before the adoption of the Constitution of the United States. In fact, it is and has always been one of the attributes of citizenship under a free government. . . .It was not, therefore, a right granted to the people by the Constitution." Thus the very importance of the rights protected by the First and Second Amendment was used as the basis for the argument that they did not apply to the states under the Fourteenth Amendment. In later opinions, chiefly Presser v. Illinois 61 andMiller v. Texas 62 the Supreme Court adhered to the view. Cruikshank has clearly been superseded by twentieth century opinions which hold that portions of the Bill of Rights � and in particular the right to assembly with which Cruikshank dealt in addition to the Second Amendment � are binding upon the state governments. Given the legislative history of the Civil Rights Acts and the Fourteenth Amendment, and the more expanded views of incorporation which have become accepted in our own century, it is clear that the right to keep and bear arms was meant to be and should be protected under the civil rights statutes and the Fourteenth Amendment against infringement by officials acting under color of state law.
But they continue to finance outsize US trade deficits and cooperate with Washington's gold suppression agenda by leasing bullion at absurdly low rates to short sellers.
More and More, Europeans Find Fault With U.S.
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By SUZANNE DALEY
ARIS, April 8 -- Just read the title of his new book and you'll get an idea of No�l
Mam�re's perspective: "No Thanks, Uncle Sam."
Mr. Mam�re, an outspoken though hardly extreme member of the French Parliament, has
devoted an entire book to his argument that America is a worrisome society these days. It has
a record number of armed citizens. It embraces the death penalty, turns the poor away when
they need medical care, and its legislators have failed to approve a nuclear test ban. Yet, argues
Mr. Mam�re, the United States throws its weight around and would have the entire world
follow in its steps.
At this moment, he says in his closing chapter, "it is appropriate to be downright
anti-American."
In France, indeed in Europe, Mr. Mam�re is by no means alone in his criticism of the United
States. Wander a French bookstore these days and you will find any number of catchy titles
("The World Is Not Merchandise," "Who Is Killing France? The American Strategy,"
"American Totalitarianism" to name a few) deploring the American way -- from its creation of
a society ruled by profit to depictions of the United States as an unchecked force on its way
to ruling the world.
The books are only one sign of what experts say is a growing backlash of anti-Americanism.
More and more often, Europeans talk about America as a menacing, even dangerous force
intent on remaking the world in its image. And, like Mr. Mam�re, many members of Europe's
political, cultural and intellectual elite are using a kind of moral calculator to deplore the
American model as severely wanting.
Poking fun at America has always been a European pastime, particularly among the French.
In the past, Americans have been ridiculed as Bermuda-shorts-wearing louts who call
strangers by their first names and know nothing about the good life. But today's criticism is
far from being an amusing rejection of food rituals. Experts say that it has a virulence and an
element of fear never seen before.
"With the fall of the Berlin Wall, America was left as the only superpower," said St�phane
Roz�s, the director general of CSA Opinion, which conducts many surveys for news
organizations. "And there is a great deal of fear out there that the strength of America's
economy will impose not only economic changes but social changes as well. What they see is
an America that has the ability to impose its values and they are not values that the Europeans
believe in."
The Europeans read menace in a wide range of recent events. Far from seeing America's
involvement in Kosovo as a hand of support from across the Atlantic, for instance, many
Europeans saw it as an American manipulation of NATO. And the humiliating fact that the
intervention would not have been possible without American air power only rammed home the
perception of America's military superiority, and of European deficiency.
But suspicion runs high in other areas as well. The Clinton administration's cheerleading --
for instance, its repeated description of the United States as being the "indispensable" nation
-- strikes a threatening chord here. And recent disputes such as America's decision last year to
impose an import tax on goods like Roquefort cheese and foie gras because the Europeans
would not accept hormone-enhanced beef from the United States only fuels the European
sense that the United States is a bully.
In Europe, these days, the World Trade Organization -- which sanctioned the American action
-- is routinely dismissed as a tool of American interests.
The idea that the United States is already using its vast satellite and spy networks for
industrial espionage is readily accepted here, as recent debate in the European Union on the
Echelon electronic surveillance system showed. The United States denied the charges, but the
European bloc is still mulling an investigation. Again, the size and scope of the surveillance
system make Europe feel dwarfed.
Even the recent debacle over picking a managing director for the International Monetary Fund
fueled the sense among some Europeans that the United States can do whatever it wants. In
Washington, government officials let it be known that they were opposing the first German
candidate because, they said, no one in Europe wanted to do the dirty work of pointing out his
inadequacies. That version of events did not get much press here. In Germany, the American
veto power provoked snide remarks.
"We have discovered that the superpower sees its global role not only in the military area but
also in setting the rules of globalization through the I.M.F," pronounced Michael Steiner,
chief diplomatic adviser to Chancellor Gerhard Schr�der, in the middle of the controversy.
To be sure, the average European is embracing much that comes from the United States. Its
films, its music, its fashion and, even if no-one in France particularly cares to admit it, its fast
food. The weekly best-seller list shows more than half the top selling novels in France are
translations of American books. There are frequent complaints of a brain drain as young
people flock to Silicon Valley and elsewhere in America to get their start in life.
But at the same time the view of a belligerent United States is growing too. Polls conducted
by CSA in the last few years suggest that Europeans have some extremely negative views of
the United States. In April last year, 68 percent of the French said they were worried about
America's status as a superpower. Only 30 percent said there was anything to admire across
the Atlantic. Sixty-three percent said they did not feel close to the American people.
Another CSA poll in September 1998, which compared the attitudes of the Germans, Spanish,
French, Italian and British toward the United States, found they had deep reservations too.
The Italians seemed to appreciate America the most. But they still showed profound concern
about the American model. Between 57 and 60 percent said America's democracy and
economy were worth admiring. But 56 to 62 percent said Italians should not look to America
for inspiration on their way of life or their culture.
"We have the impression that America has no more enemy," says Michel Winock, a
professor at the Institut d'�tudes Politiques de Paris who often writes on the subject of
anti-Americanism. "It does what it likes now when it wants. Through NATO it directs
European affairs. Before we could say we were on America's side. Not now. There is no
counterbalance."
On some social issues, the United States and Europe do seem to be going in opposite
directions. One that gets a lot of attention is the death penalty, which has either been abolished
or suspended by all members of the European Union but is now legal in 38 states. Coming
executions are often carefully followed here as examples of barbarism, and American
diplomats say they are bombarded with questions about them. The fact that many recent
executions have taken place in Texas also colors -- negatively -- European commentators'
views of Gov. George W. Bush.
But other aspects of America are deplored too. Essayists have a field day with descriptions of
the homeless on the streets, women in jail forced to give birth in handcuffs, drugs, police
violence, racism, and what they see as a puritanism that invades people's private lives, the
prime example being the Monica Lewinsky affair.
"Never has America been so loved and so hated," says the novelist Pascal Bruckner, who has
also written on anti-Americanism. "But in some ways America should be glad. We are not
condemning the Russians for a lack of morality. We don't care. They don't count."
Felix Rohatyn says he has felt the change of attitude take place since 1997, when he arrived in
Paris as the American ambassador.
"The anti-Americanism today encompasses not a specific policy like Iranian sanctions but a
feeling that globalization has an American face on it and is a danger to the European and
French view of society," Mr. Rohatyn said in an interview. "There is the sense that America is
such an extraordinary power that it can crush everything in its way. It is more frustration and
anxiety now than plain anti-Americanism."
Mr. Rohatyn, like many others, says it is hard to measure the consequences of this attitude,
though there are no doubt many. "It impacts most things," he said. "Not that it makes
transactions impossible, but it certainly puts a different slant on them. It totally negates the
notion that our interest is also in their interest. It creates the totally opposite point of view --
that only the weakening of America can be good for them."
Such an attitude, for instance, fed a recent frenzy of concern in France that American pension
fund investments in French companies might be promoting layoffs of French workers to
benefit American retirees.
"Well, that's just not the case," Mr. Rohatyn said. "That is not the way things work, but it is a
perfect example of that anti-American view at work."
Some Americans believe that part of the problem is that globalization has meant an increase in
Americans doing business abroad with methods that do not sit well with Europeans. These
Americans say they tend to try to cut short discussion and value quick decisions. Europeans
tend to take longer and look for consensus.
But the French, and other Europeans, often mention Americans' lack of knowledge about
anything European and their unwillingness to learn as a major aggravating factor.
Mr. Bruckner described how when he was living in San Diego his landlady asked him how
was his queen, when France has not had one since the 19th century. Mr. Mam�re begins his
book with a story about how Steve Forbes, at a recent Davos meeting, invoked the image of a
Charlemagne who unified Europe two centuries ago. Charlemagne died more than 1,000
years ago and is usually billed as a conqueror, not a unifier.
"Omnipotence and ignorance," Mr. Mam�re concludes about America in his first chapter. "It
is a questionable cocktail."
Mr. Mam�re's book, written with Olivier Warin, has not been published in America, nor does
he expect it to be. "It would be great if they read some of what we write, but they do not," he
said. "It would be great if they saw what they looked like from over here. But they are not
interested. The Americans are so sure of themselves. They think they are the best in the world,
that they are way ahead of everyone and everyone needs to learn from them."
How Much Longer? When Will Wall Street Crash? Some Musings from Austrailia...
Consider life after the bubble
Date: 10/04/00
By ROSS GITTINS, Economics Editor
It's time to issue a warning to punters: every economic forecast you hear rests on the unstated
assumption that life on Wall Street continues as normal.
But this reminder also carries a warning for the old pros: if you're confident of what the future holds
for US official interest rates, our official rate and the value of our dollar, you're living in fairyland.
Every economist I speak to believes that Wall Street is caught up in a speculative bubble and that its
good times can't last. But not one of them has allowed for such a course-changing event in their
forecasts.
Of course, there's a simple and innocent explanation for this seeming negligence: since there's no way
of knowing just when the Street party will end, there's no way to include it in your forecast.
But, needless to say, when the day does arrive, all forecasts will be instantly "inoperative". And those
that replace them will be very different.
My point is that the time's arrived when both punters and pros need to be more conscious of the
possibility that our present expectations could be thrown awry at any moment.
Though it's too soon to say the bubble is bursting, Wall Street's gyrations over the past fortnight make it
reasonable to wonder if that long-expected event may soon be at hand. And that makes it reasonable
to ponder some post-bubble scenarios.
Hope springs eternal, even in the breasts of dismal economists. Many are entertaining the hope that the
bubble won't burst so much as spring a leak. There won't be an almighty crash � la October 1987, just
an orderly transition to a "bear market" in which share prices gently subside.
I fear this is the triumph of hope over experience. It doesn't fit with the dynamics of positive feedback
("momentum trading", if you prefer). As the lauded US economist Franco Modigliani said last week,
"there is no bubble that quietly deflates. A bubble by its nature will burst."
There can be no neat "rotation" from speculative tech stocks to blue-chip industrials (or to bonds).
When the Nasdaq comes down, wealth will be destroyed. It ceases to exist - and so can't simply be
transferred to the Dow.
Nor is it realistic to hope that blue-chip share prices will hold steady - or even rise a little - while tech
stocks crash. Panic is far too contagious to make that likely. When the bubble bursts, the whole
sharemarket will suddenly be on the nose and all share prices are likely to fall, even if some fall a lot
further than others.
The first thing to note is that the fortunes of Wall Street - as best measured by the all-embracing
Wilshire 5000 index - will have powerful implications for the future course of US monetary policy.
Alan Greenspan's confusing remarks last week about how he's not targeting the sharemarket, and his
disingenuous claims about monetary policy's inability to influence share valuations (!), need to be
interpreted with care.
The most plausible interpretation is that he, too, is expecting the bubble to burst at any time, and is
setting up his alibi: when Wall Street crashes, don't blame me.
His desire to avoid blame for the impending crash makes it unlikely he'll do anything unusual that could
trigger it, or be claimed to have triggered it, such as switching to a 50-basis-point tightening or pulling
on a surprise tightening between meetings.
No, he'll keep his head down by sticking to Plan A: continuing the series of well-signalled, 25-point
tightenings after each monetary policy meeting until something gives. So if we get nothing more than
further wobbles on Wall Street, the 25-point tightening on May 16 will go ahead as expected.
But here's the point: because share prices are driving the "wealth effect" he clearly finds so worrying,
whenever it is that we get a truly major correction on Wall Street - as measured by the Wilshire - Dr
Greenspan can be expected to call a pause in his regular tightenings while he waits to see what
eventuates.
And once we get a full-blown crash with all the scary trimmings, the tightening episode will be finito.
Indeed, once he's satisfied that the monster is truly dead - that the speculators have gone out
backwards, that the blow to confidence is lasting and that the wealth effect has gone into reverse - Dr
Greenspan will start easing policy.
The next thing to consider is the likely implications for the US dollar. Will it still be riding high while
foreign investors are taking what's left of their money home and American consumers are slashing
their consumption of imports? I doubt it.
At present, the forex market has the future all signed and sealed: the US Fed will go on tightening for
the rest of the year, the differential between US and Australian official rates will get ever wider and so
the risks for the Aussie dollar are uniformly downward.
But the future isn't nearly so clear-cut. Wall Street could throw this scenario out the window at any
moment. It bears thinking about.
[Thanks to SIDNEY MORNING HERALD, Fair Use for Educational/
Research Purposes Only]
http://www.constitution.org/mil/rkba1982.htmFinally, recently, an issue of enforcement of existing Federal laws concerning guns made it to the news when the NRA took on the Executive branch. The below offers an insight as to the political pressure the BATF has been under since 1982 to not enforce Federal laws because it made criminals out of innocent people. Yet, now we again have pressure to enforce laws that this Congressional subcommittee says are questionably constitutional.
-- Congress passes laws that are questionably Constitutional
-- BATF must enforce these laws, when they do, they end up making criminals out of innocent people who possess firearms for legitimate reasons.
-- Public pressure makes the BATF not enforce these laws.
-- Congress is pressured to pass more laws.
-- NRA says no more laws, enforce the ones you have.
-- Circle repeats.
I say:
-- Remove all laws from all books that make a person a criminal for possessing or bearing any weapon that could be used to defend oneself from criminals, an oppressive government, or an enemy of the State.
-- Create a national, uniform, CCW law that permits law-abiding citizens to carry concealed weapons in all locations with few exceptions.
-- Repeal any law that makes it illegal to own a weapon because it contains too many bullets or fires too fast. The point here is that, if the potentially oppressive government or enemy or criminal has weapons that are superior then the citizen should have right to keep and bear same.
-- Repeal or prevent any law requiring gun registration or a license to buy or possess a gun.
-- Release all persons who were criminalized by laws that are unconstitutional or that made a criminal for the mere possession or bearing of any gun.
-- Restore full citizenry rights to the same person immediately above.
-- Make it illegal for any law enforcement agency to keep or damage any confiscated goods in the enforcement of any of the above unconstitutional laws.
-- Make it legal to sue the above agencies for the immediate act above.
It is extremely important to understand why the right to keep and bear arms is a natural right. The same applies to the possession of gold under the 9th Amendment. No law should ever be passed that would cause the confisication of any gold or any gun. The purpose of the Second Amendment is simply to be a deterrance against the individual by other individuals or the State. To infringe in any manner this right is a travesty and highly unpatriotic and questionably treasoness.
from the link above...
"Based upon these hearings, it is apparent that enforcement tactics made possible by current federal firearms laws are constitutionally, legally, and practically reprehensible. Although Congress adopted the Gun Control Act with the primary object of limiting access of felons and high-risk groups to firearms, the overbreadth of the law has led to neglect of precisely this area of enforcement. For example the Subcommittee on the Constitution received correspondence from two members of the Illinois Judiciary, dated in 1980, indicating that they had been totally unable to persuade BATF to accept cases against felons who were in possession of firearms including sawed-off shotguns. The Bureau's own figures demonstrate that in recent years the percentage of its arrests devoted to felons in possession and persons knowingly selling to them have dropped from 14 percent down to 10 percent of their firearms cases. To be sure, genuine criminals are sometimes prosecuted under other sections of the law. Yet, subsequent to these hearings, BATF stated that 55 percent of its gun law prosecutions overall involve persons with no record of a felony conviction, and a third involve citizens with no prior police contact at all."
"The Subcommittee received evidence that the BATF has primarily devoted its firearms enforcement efforts to the apprehension, upon technical malum prohibitum charges, of individuals who lack all criminal intent and knowledge. Agents anxious to generate an impressive arrest and gun confiscation quota have repeatedly enticed gun collectors into making a small number of sales � often as few as four � from their personal collections. Although each of the sales was completely legal under state and federal law, the agents then charged the collector with having "engaged in the business" of dealing in guns without the required license. Since existing law permits a felony conviction upon these charges even where the individual has no criminal knowledge or intent numerous collectors have been ruined by a felony record carrying a potential sentence of five years in federal prison. Even in cases where the collectors secured acquittal, or grand juries failed to indict, or prosecutors refused to file criminal charges, agents of the Bureau have generally confiscated the entire collection of the potential defendant upon the ground that he intended to use it in that violation of the law. In several cases, the agents have refused to return the collection even after acquittal by jury."
"The defendant, under existing law is not entitled to an award of attorney's fees, therefore, should he secure return of his collection, an individual who has already spent thousands of dollars establishing his innocence of the criminal charges is required to spend thousands more to civilly prove his innocence of the same acts, without hope of securing any redress. This of course, has given the enforcing agency enormous bargaining power in refusing to return confiscated firearms. Evidence received by the Subcommittee related the confiscation of a shotgun valued at $7,000."
I wonder why we hear so much of the atrocities and yet this story is obscure? I suppose it's because evil and horror is always better "Copy' the Ethics and valor.
Date: Sun Apr 09 2000 12:40
mozel (@Gen'ral Disney @In Horse Pucky Territory @War Money) ID#153110:
Copyright � 2000 mozel/Kitco Inc. All rights reserved
Americans live where legislated crminality was supposed to be against the Law of the Land. Government was here to secure the natural, inherent, unalienable rights of mankind. "Rights are either absolute or relative. Absolute rights are such as do not imply any correlative duties. Relative rights are such as do imply correlative duties.
Absolute rights are of two kinds or classes: First those rights of property which constitute ownership or dominion, as distinguished from rights in the property of another, - jura in re aliena; secondly, personal rights; i.e. those which belong to every person as such.
Relative rights as well as their correlative duties, are called obligations; i.e. we have but one word for both the right and its correlative duty... Absolute rights, therefore, make up the entire sum of human rights." C.C. Langdell Harvard Law Review Vol. I. No. 2. May 16, 1887 pp. 55-56 "... all men are by nature equally free and independent, and have certain inherent rights, of which, when they enter into a state of society, they cannot, by any compact, deprive or divest their posterity; namely, the enjoyment of life and liberty, with the means of acquiring and possessing property, and pursing and obtaining happiness and safety." Virginia Declaration of Rights 1775
Debt and Credit are rights in the property of others - jura in re aliena. Socialism and communism are political movements to give effect to a theory of social or communal rights in the property of others. In the law of relative rights, one person's right is always another person's duty or obligation or responsibility. These are the rights of legislated persons, individuals. Legislated criminality involves ignoring or violating legal obligations, obligations made for your individual or artificial person by the legislators who grant relative legal rights. More fiction is written by legislators than by novelists. It is known as legal fiction. There is no body of a King in America. There is no one, no body, to claim a right in the name of the King. With the compact on social security between the President and the Queen of England, they may claim otherwise. Just about every offense on the books is there to fulfill an obligation made to a foreign Sovereign or Prince in a Treaty. Employment and labor law, firearms registration and confiscation, drug law, and much, much more are all on the books to show "good faith" to the other side of a treaty. Treaties are private international law between Princes. Does the President and the Senate own your private, inherent, natural, unalienable rights to treat with others respecting. The very word "unalienable" means they do not. "It is a rule founded on the plainest dictates of common sense, adopted in all systems of law, that no one can transfer a right to another which he has not himself: nemo plus juris ad alienum transfers potest quam ipse habet. Dig. 50, 17, 54 10 Pet. 161, 175; Co. Litt. 305." Bouvier 1856 But, the rights of individuals are not unalienable. An individual is an artificial person. To the extent which you agree that any other man or greoup of them has a moral or other authority to make law for you to live by, you will identify with your individual. You will make your assigned self, their creature, subject to the jurisdiction of him or them and by identification with that self surrender your personal dominion. It is their law. Whether or not you consent to it, assent to it, or acquiesce in it is your individual decision. Elsewhere in the world, people have no such choice that I know of.
Is it true that governments exist to define money ? It requires but a moment's thought to confirm that the definition of money by government is ipso facto an impairment of liberty of contract. Government's first reason for being is to provide a peaceful just venue for contract enforcement. Money defines itself by usage of men. A government that impairs liberty of contract or impairs the obligations of contract voids its reason for being. It is on this point that rule of man is distinguished from rule of law.
@Gen'ral Disney You are well off out of it. I think the Tocom action is the future of markets. People are accustomed to buying at a certain moment and selling at another. But, there is nothing that says it must be so. Purchase and sale price could as well be calculated as a daily or longer period average of bids and asks. Just an exchange rules change. Affecting the individuals who buy and sell there. I finally got it through my head that none but individuals, trusts, corporations, and the like are even allowed to open accounts. Since the Great One's Bank Holiday.
My maxim: the final crisis of every socialist regime is always financial.
It is a corollary of the inevitable moral deterioration which is consequent to a loss of personal dominion in a society. The American outlet for the propaganda in socialist countries exhorting the workers to meet production quotas is the television evangelist, political or religious in character, promoting individual responsibility.
The final crisis of the global socialist regime which exists by Treaty will be a currency crisis.
My PT Story
For my birthday this year, my wife ( the dear ) purchased a week of private lessons at the local health club for me. Although I am still in great shape since playing on my high school varsity chess club, I decided it would be a good idea to go ahead and give it a try. I called the club and made my reservations with a personal trainer named Tawny, who identified herself as a 26-year old aerobics instructor and model for athletic clothing and swimwear.
My wife seemed pleased with my initial enthusiasm to get started.
The club encouraged me to keep a diary to chart my progress.
Monday
Started my day at 600 AM. Tough to get out of bed, but found it was well worth it when I arrived at the health club to find Tawny waiting for me. ( She is something of a goddess with blond hair, dancing eyes, and a dazzling white smile. WOO HOO!!! ) Tawny gave me a tour and showed me the machines she took my pulse after five minutes on the treadmill. She was alarmed that my pulse was so fast, but I attribute it to standing next to her in her aerobic outfit. ( I enjoyed watching the skillful way in which she conducted her aerobics class after my own workout today. Very
inspiring. ) Tawny was encouraging as I did my sit-ups, although my gut was already aching before I began from holding it in the whole time she was around. This is going to be a FANTASTIC week!!!
Tuesday
I drank a whole pot of coffee, but I finally made it out of the door. Tawny made me lie on my back and push a heavy iron bar into the air... then she put weights on it! My legs were a little wobbly on the treadmill, but I made the full mile. Tawny's rewarding smile made it all worth while. I feel GREAT!!!
Wednesday
The only way I can brush my teeth is by laying the toothbrush on the counter and moving my mouth back and forth over it. I believe I have a hernia in both pectorals. Driving was OK as long as I didn't try to steer or stop. I parked on top of a Geo in the club lot. Tawny was impatient with me, insisting that my screams bothered the other club members. ( Her voice is a little too perky for early in the morning, and when she scolds, she gets this nasally whine that is VERY annoying. ) My chest hurt when I got on the treadmill, so Tawny put me on the stair monster. ( Why in HELL would anyone invent a machine to simulate an activity rendered obsolete by elevators? ) Tawny told me it would help me get in shape and enjoy life. She said some other sh!t too, but I was too
busy trying to block the annoying screech of her voice to listen.
Thursday
Tawny was waiting for me with her vampire-like teeth exposed as her thin, cruel lips were pulled back in a full snarl. ( I couldn't help being a half hour late. It took that long for me to tie my shoes. ) Tawny took me to work out with dumbbells. When she was not looking, I ran and hid in the men's room. She sent Lars to find me, then, as punishment, put me on the rowing machine... which I sank.
Friday
I hate that BITCH Tawny more than any human being has ever hated any other human being in the history of the world. ( Stupid, skinny, anemic little cheerleader wannabe BITCH ) . If there was a part of my body I could move without unbearable pain, I would beat her with it. Tawny wanted me to work on my triceps. I don't have any triceps! And if you don't want dents in the floor, don't hand me barbells or anything that weighs more thana tissue. You alone will be responsible for the damage. ( Which I am sure you learned in the sadist school you attended and graduated magna cum laude from, you Nazi Bitch. ) The treadmill flung me off and I landed on a health and P.E. teacher. Why couldn't it have been
someone softer, like the drama coach or the choir director?
Saturday
Tawny left a message on my answering machine in her grating, shrilly voice wondering why I did not show up today. Just hearing her made me want to smash the machine with my planner. However, I lacked the strength to even use the TV remote and watched eleven straight hours of the son of a bitching weather channel.
Sunday
I'm having the church van pick me up for services today so I can go and thank God that this week is over. I will also pray that next year my wife ( the BITCH ) will choose a gift for me that is fun... like a root canal or hemmorhoidectomy.
@War Money The American War of Independence was not won with paper money. It was not won with continentals. It was won with loans of specie from the King of France, loans arranged by Ben Franklin and Thomas Jefferson, chiefly.
The government of the United States prevailed over the Confederate government in no small part precisely because it did not rely nearly so much on borrowing for its war effort. http://www.tax.org/museum/1861-1865.htm
Ideology is the modern fuel for war. Lincoln made the conversion to ideology for war fuel with his Emancipation Proclamation. There was no motive other than ideology for the Children's Crusade. There is no motive other than ideology to make the world safe for democracy or safe for corporate capitalism. What is in it for the man who lends his body ? Nothing but pieces of paper and the applause of his fellows. The social urge is so strong in mankind that few can think clearly on these things. Sacrifice is one of the most powerful ideas to ever find lodgement in the mind of man. It is the most wonderful tool for tyranny over the mind of man ever conceived, I think.
The territory of the mind is the battlefield. Your mind is your own, or it is someone else's. To whom do you extend credit ? And why ? And how much ? On individual answers to those questions depends the future of this world.
http://www.economist.com/editorial/freeforall/current/fn4208.html"For the truth is that nobody knows
if this is the end of the tech bubble. Reason suggests that
tech stocks should go down. But if reason had much to
do with share prices, they would never have risen to their
current heights. Wall Street's finest will do all they can to
get the bandwagon rolling again. American investors still
have the equity faith: tens of billions of dollars of
retirement money are even now heading for the market.
Many investors are preparing to react, as they have so
profitably to previous market downturns, by 'buying the
dips'. Alan Greenspan, the Fed chairman, may feel less
need to raise interest rates now that share prices show
some sign of heeding earlier warnings. And, lest anyone
forget, it is presidential election year�and Bill Clinton will
be keen to get Vice-president Al Gore into the White
House."
http://www.zolatimes.com/v2.32/socsec_myth.html "This pirate [U.S. Grabbit] has been stealing from the people.
This pirate will hang at the hand of the people not by the
power of government. That is common justice. Using the term
pirate for such an entity is in fact a disservice to the noble
piracy trade. This rogue and scoundrel (he who steals from
the people on such a grand scale) can only be called by one
name. 'Government.'" -Henri (4/9/2000; 6:17:07MDT - Msg ID:28334)
Most definitely & well spoken, SIR Henri - - - and the sooner it comes to its
well earned bad end the better for us all. I can add only one amplification:
Not satisfied with only taking as much as 45% in so-called income tax plus
F.I.C.A., the U.S. Grabbit, in addition, borrows incredible amounts and thus
indebts our even as yet unborn children and grandchildren, who, according to
Clintoon's 1994 budget, will eventually have to pay between 84% and 92% of their
income in taxes.
The official government debt (usually called ingenuously "National
Debt") has now increased to $5.6 trillion over the last couple of years,
despite the claim is made that it is being paid off, and despite the fact
the Grabbit spends the excess Social Security take as if it was part of
it's income. They call this unique accounting proceedure the "Unified Budget."
Thus the approximately $110 billion Social security "surpluss" is accounted
as DECREASING the deficit by $110 billion.
Check the link just below for an on-line U.S. Grabbit debt clock:
http://www.brillig.com/debt_clock/
This only represents about 1/5th of the debt story though; it doesn't include
"off budget" expenses such as the approximately $11 trillion estimated costs
for the untouchable "Social Security" and Medicare welfare benefits expected
by duped citizens. There is at least an additional $4 trillion or so in other
"off budget" expenses such as government pensions, Superfund clean-ups, and
clean-up costs for government nuclear sites such as the Hanford site in
Washington.
For a surprising expos'e of the "Social Security" situation, click on the
link in the header of this post.
Sir Henri- From my wife's native Japan, comes the tradition of bowing in honor and respect, which I extend to you with the deepest of bows. Your treatise's of today on work, energy, truth, time, and love are expressions in words that I have only understood by feeling thusfar. These thoughts shall go into my hall of fame. Hopefully many others reading these scripts will absorb your words of truth.
With your thoughts in mind I'm heading outside for a first spring tilling, on a golden day in the mountains.
http://www.eagle-net.org/phikent/japan/japan2.htmlTangential excerpt:
"At the risk of accusations of paranoia, one might conclude that a real conspiracy of managed information dominates America's well-springs of public knowledge."
What will be good for gold and its shares is a slowly grinding down stock market. After all romanticism is stipped from market lore, what we are left with is only a glorified lemonade stand. ESOP stock is now coming on stream in large quatity. The Publics appetite for stock may have reached a point of satiation [exhaustion]. Oversupply of anything=price discounting. Resumption of a further leg down will severely test the logic of adhering to the "greater fool theory", with respect to such high P/E stocks.
The Fed is caught between a rock and a hard place. Higher interest rates must creep up incrementaly to maintain dollar. If dollar begins down phase, which all evidence and certain pundits point too (Jimmy Rogers), thats just more pressure against no yield story stocks. The day in and day out grind down demoralizes(dont gold bugs know that one), and the uncertainties open up a search for investment alternatives.
A tricle at first will begin to go into hard assets and then as the storms of paper wealth destruction and inflation gathers force the tricle to hard asset demand will turn into a deluge of demand.
"...The bill, said Sen. Jeff Sessions, R-Ala., will ``protect the legitimate constitutional rights of American citizens while at the same time protecting this tremendous asset to law enforcement.''
The legislation would shift the burden of proof in asset forfeiture cases from the property owner, where it now lies, to the government."
**Mr. Black Blade, thanks for the supply deficit report which I printed out (15 pages). I like the fundamental information. Sir Aristotle- just reread your Hall of Fame explanation of oil, currency and gold. If your not teaching outside of this forum, then the world is short one great professor. Thanks
According to Jeff Cooper at tradingmarkets.com...........
"Of course,this time could be different. The consensus for the Nasdaq script now is that the market needs time to back and fill, to stabilize, and to catch its sea legs-and that it is likely we will see a test of the lows in two or three weeks. I suggest that we are either going nowhere near those lows-and that its up,up and away quickly-or that Tuesdays lows will be taken out with vigor. Something about the test scenario just rings too pat. Its the consensus and majority opinion. Furthermore, this is a mature bull market. If its going to blow-off this is exactly how it would occur, with stopped-out bulls scrambling to get back on board as bears continue to throw "logs", on the fire at retracement levels".
This blow-off, if it happens would seem very poetic to me. In keeping with precedent breaking nature of this bull-run, we could have "the Mother of all blow-off tops, in "the Mother of all bull traps". Then at the exhaustion peak, we can witness the Comex and PPT having their rigging ediface burned up in the downward running molten lava.
.....at GE. There is a lot of bearish sentiment over there. I'm glad to see so little talk here of gold stocks, paper gold and the POG. It's a little longer term battle on this front; a monetary argument takes a little more time to evolve and gain acceptance.
Buy gold now--all you can understand. Thanks for the company......CM
http://www.SelectSectors.com/ag_xau_gcmx.gifThe below chart compares Select-Gold, XAU and Comex-Gold.
The curves are plotted on a percentage basis, so the premium
that the Gold stocks enjoy over bullion may be compared over time.
The chart shows when this percentage premium shrinks to the bullion
level, a strong Gold stock rally follows. When it goes below the bullion
level, it's time to mortage the house and go long.
This is a Story About my Grandfather -- He Flipped a Silver Dollar, That's Why I'm From Wyoming
Received your letter of March 11th and was both pleased and surprised and
should have been more prompt in answering but several things have come up
that delayed my writing. I have been busy looking after my little ranch and we
have a little bunch of purebred cattle and they had to be cared for and as the
ranch is 20 miles from where we live here in town it was quite a chore to go
out there and feed and look after them and my wife was in the hospital over
at Sheridan forty miles north of here for major surgery and I was over there
to be with her part of the time so didn't have much time to write.
It will take several letters to tell you all of our trip out here and what we went
thru and the coming of our present modern living, and I am glad to write them
for you but it will take some time. They will be all written from memory as I
never kept a dairy or note book of any kind.
Father had been in the horse business and farming until the panic of 1894 and
sold out before he lost everything he had. I don't know how many mares he
had but he had one English shire stallion he's imported from England that cost
him $1000.00 which was lots of money at that time. He got out with $400.00
and bot a black smith shop in a little town close to St. Joseph Missouri and
that a bad deal as the people didn't have any money to pay for the work they
had done so he had to give up and took another loss, so he decided to make a
move.
He had some friends in Texas and also had a brother that had come to
Wyoming in 1893 (the year I was born) so he decided to move either to go to
Texas or Wyoming as they both claimed they we would be able to get work
and altho the wages were small one could still make a living, so he disposed of
everything he had except a few of the most essential belongings as a few
household goods consisting mostly of bedding and a few cooking utensils and
a small cook stove. He had kept four of his best mares when he sold out his
horse outfit so he bot 2 new wagons and 2 new sets of harness, covered the
wagons with bows and covered them with canvas loaded everything in the
covered wagons and was read to take off. Mother was going to drive one
team and father the other but just at the last moment a brother of my father's
decided to come with us. His wife had just died and he left his 3 children with
some of the relatives so he came along to drive one team.
The morning we were to start which was may the 6th 1896 and with quite a
crowd of friends and relatives gathered around some one asked father if he's
decided where to go yet and he told them he would decide in just a minute so
he took a silver dollar from his pocket and said he would throw it up in the air
and if it came up heads he would go to Wyoming but if it came up tails he
was going to Texas. It came up heads and that is the reason I am writing you
this letter from Buffalo Wyoming.
We headed for Omaha Nebraska and at Council bluffs just across the
Missouri River we had our first accident that delayed us. In the night one of
our horses kicked the other in the shoulder and crippled her and we were
unable to travel until the horse was able to move around or until father could
get another horse. There were lots of horse traders and horses such as they
were but they didn't have a horse that would anywhere match the horses
father had so he decided to wait a few days and see how things turned out.
One day he heard of a fellow that had a horse that he thot might suit him and
it was across the Missouri just west of Omaha so he drove over to see about
it. Our horses had never seen a street car. I believe when I was in England
that you people there called them trams or tramways, am I right?
Well the team got scared and one horse tried to climb over the railing of the
bridge and it looked like for a minute she might succeed but there were
several men on the bridge and they all came to our rescue. Father just the day
before had pealed a straight green hickory pole to use to hold our canvas
cover up on the wagon and one fellow grabbed that and hit the mare over the
head and knocked her down just as she was getting her feet over the railing.
When she got up there were several men had a hold of the bridle and anything
they could get a hold of and controlled her best they could but the big boy
with the hickory cub had to knock her down several times before we got
across the bridge. From the top of the floor of the bridge was just about forty
feet so you can imagine what a frightening experience that was. When we got
out to where the horse was it was sure a disappointment as the horse he
showed father he would have been ashamed for anybody to have seen him
leading it down the road, let alone driving it, so he decided to wait as we had a
nice place to camp close to the river among the shade trees and lost of grass
for the horses.
We stayed there maybe 10 days or two weeks and the condition of the mare
improved and so we started on but traveling was slow. We wend from Omaha
to Gordon Nebraska where father had a cousin living and just a few years
before and not far from there he had a distant cousin killed and scalped by the
Indians. We stayed there a few days I don' know how long and let the horses
rest and also mother washed up all our clothes and baked bread. That sounds
kindy funny now as one can go into a bakery and buy bread at any store or
service station but this was 62 years ago and bakery bread was almost
unheard of except ti the very largest towns. After leaving there we headed on
west and the father we came the fewer the farms.
Some days we didn't see a house. They were certainly few and far between
but the plains were covered with cattle and antelope by the thousands. We
would see a few cowboys and they were glad to see some one to speak to.
They were what was called line riders and were keeping the cattle from
drifting. Most of these cattle had been trailed up from Texas and were trying
to head back to what had been their home. These cowboys were real friendly
and accommodating. We met two of them one afternoon and father asked
them how far it was to the next store and they said 80 miles. That isn't far
now but it sure was then driving a team of big horses. They asked him what
he needed and he said he would like to buy some bacon and some grain for
his horses also. They told him where there was a nice creek on ahead where
he could camp and they would bring him some bacon that night and that he
would pass a ranch next day where he could get grain.
That night just at dusk they rode up to our camp and one fellow says "Well
old man here is your bacon" and he had a hind quarter of beef. They had
butchered a 5 or six year old steer and that quarter of beef must have weighed
150 or 175 pounds. When father offered to pay him for it they just laughed
and said they would board it out with us and they sat down and ate supper
with us and visited for a while and went back to their line camp. They seemed
to be happy for what they done and you know how pleased we were.
This was the rainy season and some days we were not able to travel at all and
other times we would have to wait for the water to go down at some of the
river crossings as at that time there were no bridges and the creeks and rivers
had to be forded. One afternoon we could see some awful black storm clouds
coming up in the west and we knew we were going to be in for an awful
drenching and a miserable night but in the distance we could see a large grove
of trees and father thot if we could make it to them we could get a little shelter
from the storm.
We made it there just as it was getting dark and the storm hit at the same
time. It was a ranch home and when we drove up a man came out to the gate
to meet us. I don't know how big he would look to me now but I thot he was
the biggest man I ever saw. He had a big heavy black beard and maybe that
had lots to do with his looks.
Father asked him if we could camp in his grove and he said "no you can't
camp in my grove!" and then in a softer tone he said "but you can sure as hell
sleep in my house!" I was sitting between father and mother and he reached
up and took me and handed me to his wife and she ran back to the house with
me and mother came on in with my brother and my two sisters. He helped
father and my uncle take care of the horses. He had a large barn and they fed
the horses hay and grain and then they came on in the house and got supper.
That was the happiest woman one ever saw to think there was a woman she
could visit with and she sure made a fuss over us kids. It had been just a year
since she had seen another woman to visit with. One can hardly imagine that
but that was the case of several early day settlers. We stayed there several
days, I don't know just how long.
This was a big horse ranch and he wanted father to throw in with him and go
to raising big horses. He had some awful good horses but nothing to equal the
ones father had, but father had set his mind to go to Wyoming and that was
that. He ofttimes said afterwards that that was one of his worst mistakes that
he didn't accept that fellows offer and stay there. That was in the sand hills of
Nebraska. The roads so far had been nothing but dirt roads at the best and
other times no road at all just trails made by the trail herds of cattle being
trailed thru from Texas. There's another thing I want to mention now and that
is about the fuel. There wasn't a tree sometimes for a hundred miles and of
course coal was unheard of so what we used for fuel was cow chips (cow
manure) Some of the permanent settlers in that plains country would get a
trail herd of two or three thousand head of cattle to camp on their place over
night and that would give them enough fuel to last all winter.
From this ranch we started on west and came to the Pine Ridge Indian
reservation. Of course the Indians had been subdued several years prior to
this and confined to the reservations but the new harness with nickel
trimmings looked like too much of a temptation to the Indians so the soldiers
that were stationed there escorted us across the reservation and past until they
were sure we would not be molested and then they turned back and we kept
plodding on toward Wyoming. I'm not sure but I think the soldiers were with
us three days and nights and on the morning of the fourth day they headed
back.
We came into Wyoming just about 20 miles east of Lusk and from there on
there was a pretty good road that was well traveled by stage coaches and
freight outfits and when we got to Douglas we took what was called the
Bozeman Trail through Fort Fetterman and then north to what was called the
17 mile stage station just a few miles south of old Ft. Connor (Fort Connor).
There we left the Bozeman. We had been traveling it for a little less than a
hundred miles. We took a dim road from there that lead to Sussex on Powder
River and that was the end of our long journey. We arrived there June 27th
just 52 days from the day we started from St. Joseph Mo.
We were only there a short time until we moved on up the north Fork of
Powder River into a house that had been vacated by the EK Cattle Company.
It was a large house built of logs and had a big fireplace but like most of the
houses in that part of the country those days it had nothing but a dirt or
earthen floor, but it was a nice warm comfortable house. We lived there the
following winter and father worked for a rancher. The wages were $30 per
month and that sounded good as they were only $12.50 per month where we
came from and you had to board yourself. Father got the $30 and his board
included there. We made several moves from there until father filed on a
homestead about 16 miles south west of there on the middle fork of Powder
River and along the road that lead from the Little Missouri River and the
Belfouche Country to the Hole in the Wall which was becoming and finally
got to be one of the greatest outlaw holdouts in the west.
Father built our house a short distance from the road and in the next few
years following I saw and learned to recognize lots of the characters that in
western history have gone down as notorious outlaws. I'll tell you more about
this country and some of the men both outlaws and peace officers in my next
letter. I was glad to get your letter and will do my best to tell you all you want
to know or at least all I'm able to tell in what changes have taken place here in
the last 62 years.
Yours Sincerely
Bill Potts
110 North Tisdale St
Buffalo Wyoming
[My uncle Bill wrote this in 1958, I just found it on the Web]View
Yesterday's Discussion.
Just a short aside and a bit off topic: There are actual studies underway to develop animal feed that will reduce Bovine Flatulence in order to reduce greenhouse gases (I'm not making this stuff up!). What a crazy world we live in. But sometimes a very funny and entertaining world it is.
OK, just one more, it's late and bit quiet in here.
A colleague related a story about a research project that an acquaintance was involved with concerning Bovine Flatulence and greenhouse gas studies. Everything was going along quite well for about a year and a half. One day while the cattle were watering around a metal trough fed by a metal windmill, a sudden thunderstorm rolled in. An errant lightening strike hit the windmill and so electrocuted a good number of the cattle. The final thesis remarks were something to the effect "�.and then the study was terminated due to an unforeseen event, etc." I guess that the ensuing barbecue was quite delicious. I guess that he also found the ultimate solution to Bovine Flatulence as well :-)
Source: Bridge newsJapan investors' demand for gold up on low prices, interest rates
Tokyo--Apr 10--Japanese private investors have boosted investment in gold since early April due to relatively weak local gold prices, dealers of retailers said Monday. Current low interest rates in Japan have also attracted investors to switch their funds from fixed postal savings deposits to gold, they added.(Story .10678)
Black Blade: This could be a good sign. Since the TOCOM defaulted on Pd, some in Japan may see that buying physical PMs are worthwhile. They don't trust their government either. The Postal savings deposits are a cruel joke forced onto the Japanese. It's essentially bankrupt and pays a measly 0.5% interest. Hmmm�..
Source: Bridge newsTaiwan March gold imports 9.572 tonnes vs 8.014 tonnes year ago
Taipei--April 10--Taiwan's gold imports totaled 9.572 tonnes in March, compared with 8.014 tonnes in Mar 1999, a statement released by the ministry of finance Saturday indicated. (Story .6016)
Black Blade: Another reason for the Mainland to invade?
Malaysia's Mar 31 FX reserves at $33.92 bln vs $34.43 bln Mar 15
Kuala Lumpur--Apr 10--Malaysia's foreign exchange and gold reserves declined to 128.89 billion ringgit as at Mar 31, from 130.82 billion ringgit as at Mar 15 according to figures released by the central bank, Bank Negara over the weekend. The US dollar equivalent of the reserves fell to 33.92 billion from $34.43 billion at mid-March. The central bank did not provide a reason for the decline. (Story .8191)
Black Blade: The reason is called theft! Hmmmm.......
RBI says India FX assets $35.058 bln on Mar 31, +$633 mln on wk
Mumbai--Apr 8--India's foreign currency assets totaled US $35.058 billion on Mar 31, up $633 million from a week earlier, according to the Reserve Bank of India (RBI)'s Weekly Statistical Supplement released Saturday. Total foreign exchange reserves, including gold and special drawing rights, rose by $503 million to $38.036 billion on Mar 31. (Story .1527)
Black Blade: Way to go. Exchange for more PMs while your at it.
.
All the powers conferred by this section shall expire two years after the date of enactment of this Act, unless the President shall sooner declare the existing emergency ended and the operation of the stabilization fund terminated; but the President may extend such period for not more than one additional year after such date by proclamation recognizing the continuance of such emergency.
Sec. 13. All actions, regulations, rules, orders, and proclamations heretofore taken, promulgated, made or issued by the President of the United States or the Secretary of- the Treasury, under the Act of March 9, 1933, or under section 43 or section 45 of title III of the Act of May 12, 1933, are hereby approved, ratified, and confirmed.
In order to authorize the establishment of the Exchange stabilization fund, the congress had to approve, ratify, and confirm the war and emergency acts of March 9, and May 12, otherwise this legislation would have been blatantly unconstitutional on a peace time basis.
Sec. 10 (c) confirms congress' knowledge of this fact when the powers conferred under this act are to expire after two years or sooner if the president terminates the emergency sooner.
One important thing to note is that the power to intervene in foreign currencies or to "bail out" foreign countries was only constitutionally possible during a declared state of war or national emergency when it was deemed absolutely essential for the survival of the nation. Constitutionally, when the emergency ends the emergency powers must also cease.
Yet another and perhaps more important note is the adverse or beneficial effect the currency exchange rate can have on the average person in the United States and upon the US economy as a whole.
Japan investors' demand for gold up on low prices, interest rates
Japan investors' demand for gold up on low prices, interest rates
Tokyo--Apr 10--Japanese private investors have boosted investment in gold
since early April due to relatively weak local gold prices, dealers of retailers
said Monday. Current low interest rates in Japan have also attracted investors
to switch their funds from fixed postal savings deposits to gold, they added.
(Story .10678)
Bull Trap: A short, sharp bear market rally which sucks in buyers before going to new lows. Conversely, a bear trap is a bull market correction that sucks in sellers before going to new highs.
Even a dead cat will bounce when dropped off a tall building, but the bounce will be very minor.
Today's Report: Gold Up on Japanese Physical Buying and NY Short Covering
http://www.usagold.com/Order_Form.html4/10/00 Indications
�Current
�Change
Gold June Comex
284.60
+2.10
Silver May Comex
5.16
+0.04
30 Yr TBond June CBOT
99~11
nc
Dollar Index June NYBOT
105.48
-0.27
Market Report (4/10/00): Gold was up in New York trading following a slow
night overseas. Physical demand was up in Hong Kong signalling that Asian
buyers might think that we've reached bottom for the gold price. Bridge News
reports a surge of demand among private investors in Japan hedging the weak
yen. Gold dealers there are also reporting switches from the vast, but
low-paying, postal savings system to gold. Japan announced overnight a
continuation of its zero interest rate policy. On Friday, the Commodity
Futures Trading Commission reports that large speculators' short positions
more than doubled from 24,305 contracts to 42,440 over the last two weeks.
The short position builds a positive aspect into the market because at some
points those positions will need to be squared. Squaring those positions
might be what's driving this market in the early going.
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.
List of strategic tools to add to the list.
Precision metal lathe and boring bits. Precision metal machining tools. DuPont's technology and Krupp's steel process; the guardians of freedom
Interesting insight on carry-trades and manipulated markets
http://skybluemonthly.freeservers.com/sbm/sbm00j.htmI saw this article on Fiendbears site this AM. It has some interesting insights into the yen/dollar situation and the FED/BoJ market operations. The gist to me is that this is a market that defies logic and should be avoided. The following is a quote pulled from the article.
"You see: the whole thing is a bad joke. If US stock market falls, the Fed will let M3 Growth Rate rise and hence, US stock bubble skyrockets. If rising yen is threatening US stock market, BoJ will step in and sell yen for USD to suppress yen and hence, US stock bubble skyrockets. If T-Bond is sinking (and falling bond is hurting US stock market), US Treasury Department will use budget surplus to buyback T-Bond, and hence US stock bubble skyrockets. If T-Bond doesn't rise fast enough, BoJ will use the acquired USD from its interventions to buy US T-Bonds and hence, US stock bubble skyrockets. What are we doing here? Are we supposed to write Sky Blue Monthly to forecast stock, bond and currency markets? All the above factors cannot be predicted by using any qualitative or quantitative methods. Can you read the mind of Alan Greenspan (The Fed Chairman) to know M3 Growth Rate in the next few months? Can you read the minds of those central bankers at BoJ to know when they are going to intervene again? Can you read the mind of Treasury Secretary Lawrence Summers to know when he is going to use budget surplus to buyback T-Bonds again? If you can't, you should not trade stocks, bonds, or currencies because the risk is so high. Since we can't, we should not forecast stocks, bonds, or currencies in Sky Blue Monthly! In short, Sky Blue Monthly is dead. We still have to think how to get around with this in order to save our Monthly."
So far there's been 95 pledgers (godlike souls) who've taken up 40,000 odd ounces of silver.
This is from just a sprinkle of goldbugs on the three main forums, and all in just one weekend.
If this gets going it could provide a real springboard for the price of silver.
And a squeeze for the manipulators.
Very interesting! This is the most rational behavior I've seen by investors in some time. Your savings plan only offers a measley .5% rate, and you have to worry about the quality of the government paper on top of that! If you are a conservative saver, you're much better off storing your accumulated wealth with gold. If this becomes a mania in Japan (who have proven themselves to be just as mania susceptible as we Americans), things could get very interesting indeed. Who would have thought that it would be the Japanese who began the gold ownership craze in the western economies?
Japanese Postal Savings nibbling at Gold is very bullish!!
http://www.crbindex.com/news/story2203.htmlJapan investors' demand for gold up on low prices, interest rates
Tokyo--Apr 10--Japanese private investors have boosted investment in gold
since early April due to relatively weak local gold prices, dealers of retailers
said Monday. Current low interest rates in Japan have also attracted investors
to switch their funds from fixed postal savings deposits to gold, they added.
(Story .10678)
If I recall correctly this postal fund is the largest pool of pension money in the world, NINE TRILLION DOLLARS worth!!
After the recent run-up in Palladium ..the Japanese investors may be primed for a Gold move.
In 1998, the fastest growing consumer item in Japan was home safes. There was (and still is) so much mistrust towards their banks that the Japanese people preferred cash in their home safes or to pay the government to hold their money (Nov,1998 Japanese T-bill rates were a negative).
The Japanese government debt levels are extremely high and domestic confidence is so low ..that buying gold makes all the sense in the world, and could easily turn into a powerful trend.
There was some question at the end of March, 2000 that part of this pension money might move overseas to seek a higher yield ..if instead, it starts moving into Gold ..the shorts will run like hell to cover and the price spike one more time. HLS
"A Kuroko-Type Polymetallic Sulfide Deposit in a Submarine Silicic Caldera"
K. Iizasa, R. S. Fiske, O. Ishizuka, M. Yuasa, J. Hashimoto, J. Ishibashi, J. Naka, Y. Horii, Y. Fujiwara, A. Imai, and S. Koyama
Science 1999 February 12; 283: 975-977. (in Reports)
Yes, a significant gold showing...but much too deep for conventional recovery techniques
Putting Gold Back on the Radar Screens - Is it really possible?
Although I have "borrowed" the title of this missive from one of my favorite posters, TC's #27981 ("Gold is off the radar screens at this time for millions of Western investors," Mon, Apr3), the real impetus for this posting belongs to Leigh and her posting # 27959 (also Mon, Apr3) in which she planted a pair of images in my weary brain that simply wouldn't go away.
The first: "King Solomon being told that 'a piece of paper represented the gold portion of his portfolio�." The second: " A woman, with children, fleeing a war scene & trying (unsuccessfully) to bribe a guard with a piece of [gold] paper." Bravo to Leigh. But it was because her examples were visual images that really had an impact on me (that, and the fact that I am impatient for the POG to arouse from its slumbers). The next day (Tues, Apr 4) there was a re-post from Kitco (#284255, I believe), titled "a modest proposal." The essence of this post was that "the key to the gold market�its Achilles heel�is its link to silver." Sharefin's recommendation to the Kitco readers (and anybody else) was that they collectively 'remove� 100 million oz. of silver bullion from the current marketplace. [One million buyers of 100 oz. each = 100 m oz.] Is Sharefin correct, and, even more important, is this likely to succeed? Over the last few days a number of like-minded silver/gold enthusiasts have reported that they have purchased between 100 and 1000oz of silver. I hope they make a noticeable dent in the silver market, but one million buyers is a pretty large number. At any rate, Sharefin's "Silver Pledge" should give us some indication of the depth and breadth of the internet's potential, at the present time, to influence the silver market in a grass-roots manner.
Good luck, Sharefin, for all our sakes.
Which brings me to my hair-brained scheme #10,839.
In an earlier post (#27545, Mon, Mar 27), I wrote that, essentially, the POG was more a reflection of gold as a currency than as a commodity, and that the POG was thus rather easily "manipulated" by the CBs. The POG, as a commodity, wore the lesser of its two "hats."
Well, it doesn't have to stay that way forever. A "paradigm shift" in how Americans view gold could place it "back on their radar screens" and thus change decisively the "balance of power" in the physical gold market. Other posters on this forum, far more knowledgeable than I, have explained (and predicted) this turn of the economic screw. For me, the issue resolves itself into whether one is willing to wait for the failure of the current bull market/economic system/administration/whatever, or to make a successful effort to "put gold and silver back on the radar screens." Many thousands, maybe millions, of American investors (or non-investors) have been waiting for a repeat of 1929. Waiting in vain for a collapse that (so far) hasn't materialized. Waiting for 71 years - and counting. If you want to sit down at the gold poker table with the Fed, the US Treasury, and the major banks and brokerage houses (ALL of whom trade sans commissions, and ALL of whom have access to buy/sell orders and other information that you and I can't even dream about), be prepared to lose some of your stake.
So, do we wait for those clever fellows in charge of the US economy to screw up, do we abandon the gold market (for the time being, at least), or do we try and find a way to change the way things are - and have been for the last 20 years or so? Actually, it means changing the "investment objectives" of a sizeable proportion of the 280 million Americans who are in a position to decide what to do with their families� money. Not an easy objective to achieve, to put it mildly.
How about the World Gold Council? They've been around for a long time, they have the financial support of the world's gold mining companies, they say they're in favor of higher gold prices, and they're a world-wide organization. Ah, therein may lie the rub. Because they are a world-wide bureaucracy, to expect them to try and promote gold usage/investment in one part of the world (like the USA), which might very well impinge on another part of the world (e.g. Asia), would probably contradict their charter/mandate. They seem to be content to collect date and publish articles based on this data as they have been doing these many years. If we're looking for leadership, better to look somewhere else.
How about the gold mining companies? They have hundreds of millions, no, make it billions, of dollars in potential profits riding on the POG. Unfortunately (for their shareholders), they are a house divided: the vultures among them are in favor of a low POG (so that they can acquire their less fortunate rivals), while the potential victims are engaging in hedging as if their lives depended on it - which it does. No, the gold mining companies of the world have done NOTHING to promote their product over the last few years. In early1998 there was a "trial balloon" of a commemorative gold coin launched by Peter Munk, and it produced a brief rally in the POG, but it died a quiet death shortly thereafter. None of the world's major gold mining companies has come forth with an innovative proposal to increase the sales of gold, least of all the North American producers; nobody is willing to rock the boat.
How about the goldbugs and our access to the Internet? The true believers. The bugs believing in Armageddon (for them) and nice profits (for us), all the while looking over our shoulders to see who is wielding the spray can of RAID. I may very well be wrong, but at the present time, I don't think there are enough of us. Yet. But the potential. . . and the internet. . . . If only someone. . . .
OK. What about our host, Michael Kosares? I know NOTHING about the nuts and bolts of the gold/silver coin/bullion business. I'm a retired teacher, and I'm confident that if I liquidated everything I own and bought a coin store here in Toronto, I'd be bankrupt within a few weeks, or less. Still, a few questions (especially for MK):
1. Is there an "umbrella" organization of USA coin dealers?
2. If such an organization exists, what degree of success might this organization expect, relative to their costs, of a national media campaign to promote ownership of gold/silver? Have you and your friends/competitors ever considered such a campaign?
3. Given the fact that it was illegal for Americans to own gold from 1934 to 1974 (40 years), and that during this time belief in the "quick profit" replaced belief in the "preservation of wealth," is there ANY way for the "collective" coin/bullion dealers to credibly communicate an alternative viewpoint re. gold ownership to the American public?
IMHO, retailers advertise, and the public buys according to the best ads. That's the way things work in America.
MK is a gold retailer and has the best gold forum on the Internet. He is also a very reputable retailer of gold coins and jewelry.
I know that this post of mine properly belongs under the heading of: "It's easy to spend other peoples� money," (in this case, the coin dealers of the USA). But I believe there are some attractive reasons to buy and own gold, and of which the average American is not aware.
How does MK, or anybody else, persuade the typical American investor to put Gold/Silver on his radar screen? I don't know, but some creative answers could sure make a hell of a change in the way the gold business operates. Any ideas out there from you fellow USAGOLD posters?
ORO
Can you please clear up for me the following question about inflation (which we do not have)? I understand that inflation can be defined as an expansion of the money supply rather than the Govmint CPI (cooked books) definition cited by the talking heads. If so, and with the inexhaustible supply of reserves being sent out into battle by the Fed, why does the $US continue to advance against the hard currencies like the Euro and SwFr. Theoretically, the increased supply should inflate and thereby reduce such a currency.
An addition question is: Are the reserves being sent out by the Fed "New Money" and which are being added to our National Debt and therefore eligible to be paid off with our budget surplus?
Funny you should ask. If one were to watch my tilling of the *garden* yesterday, I would appear as if a drunken sailor in a dream, without a helm. The garden is on a slight sidehill, and to keep the tiller from toppling, I ran divergent angles to the slope of the hill. Zigging and zagging merrily!
Reminds me that a good sailor, should be wary when sailing shallow waters, lest he get his rudder stuck in the sand.
Reminded me of the Fed's "coming out of the closet" phrase, "leaning against the wind".
I have been doing some in depth studies of the history of interest rate "manipulation" by the Fed. I am getting close to having some useful date to pour over and conclude from. The Fed has been "leaning against the wind" lately although you never see mention of it in the controlled press, nor does Greenspan mention it. Far be it from him to let the common man know what TPTB are really up to. We have been in an interest rate inversion situation for about three weeks now. The Fed by "leaning against the wind" admittedly is trying to push interest rates in a direction opposite the direction of the market forces.
From my perch it appears that Greenspan and company is acting the part of a "drunken sailor without a helm. To keep the tiller from topping" he seems to be "running at divergent angles to the slopes of the hill, zigging and zagging merrily along the way." You stated the case magnificently - " a good sailor, should be wary when sailing shallow waters, lest he get his rudder stuck in the sand."
For those who are interested in this interest rate inversion "thing" which I like to call a temperature inversion, I am about two weeks from being able to post some very revealing information. Let me just say for now that I feel sure that I have found a way to follow this Fed "thing" and can keep us common people posted as to what the Fed is really up to. I learned long ago to be especially on guard and to watch what Greenspan does and not listen to what he says. No one could possibly intend for the truth to be known when he uses "ambiguous verbosity" or should I say, "Inverted Government double-speak". As Henry Fond said, I think it was in "Spencer's Mountain", 'Damn, Damn and Double Damn' this nefarious, heinous, method of deception and outright underhandedness. Archibald was right; "A world of ignorant people is dangerous to live in.
Recent Nasdaq weakness...Tech stock investors haven't seen ANYTHING yet.
http://biz.yahoo.com/rf/000410/0j.htmlTop Three Nasdaq declines in percentage
Date . . . .Percent Change
10/19/87 . . . -11.35
10/20/87 . . . .-9.00
10/26/87 . . . .-9.00
Last Monday's 349.15 point fall was the largest ever at the close, but ranked only 5th in terms of percentage of "wealth" lost (-7.64%). Today's second place pointfall of -258.24 placed only eighth percentage-wise (-5.81%).
All ten of the top point declines have come in the past 3+ months of the year 2000. At what point will this concentrated span of volatility shake loose some serious selling, the likes of which investors haven't seen for a long time? Methinks their constitutions will be sorely tested.
Hello people. My name is Rhody, and I have a problem.
I am yet another loser goldbug. To keep this posting
on a proper golden footing, I would like to observe that
pog followed the $2 rule yet again in closing out COMEX.
My specialty is lease rates, yet I feel that this useful
tool in the manipulator's tool box is just about at the
end of it's career, as rates tend toward zero.
My chief concern for the future pm markets is the death
of visible markets in gold and silver as COMEX does a
TOCOM on gold as TOCOM imposed on platinum, and the shorts
walk away never to deliver. Do traders still do paper
transactions on TOCOM? Is this movie coming to an exchange
near you in gold and silver as well?????
Good to see you here Rhody. FOA has supported your thoughts for quite a while now. He has said that the paper market will drive lower until it burns of its own paper, while physical will separate and trade ever higher -- perhaps even moving to a European trading center where the contracts will be backed by physical and the same shenannigans won't happen.
Sir Hill Billy Mitchell- You have the eye of the Coyote, and I'm honored that my allegory of the *garden* and sailor was not beyond grasp. Although actually tilling yesterday, my thoughts were with Sir Henri's remarks of yesterday, and the notable movie "Being There" in which the late Peter Sellers played the part of a mystic *gardner* whom was out of step with the fruitlessness of our modern ways.
I salute your constant update and vigilance of the upside down interest rates we are experiencing. It is "THE" issue of major impact to all markets; paper today - gold and silver tomorrow. IMSSO (In My Simple Serf Opinion). Little be known to us simple nebbish, but me thinks there has been great turmoil in the land of the interest rate derivative trade, and that is what is behind the paper turmoil at the house of Nas and Dow. I await any and all dirt you uncover in your snooping of the garden. Perhaps other tillers of our golden patch can enlighten us on this matter; Sir Oro?
Citizens and their monetary choices...and the Fed adds lots of cash to banking system
http://biz.yahoo.com/rf/000410/t.htmlToday the Bank of Japan's Policy Board once again volted to maintain its "zero-interest rate policy". Fourteen months into this abnormal situation wherein the BOJ has been seen to be dumping yen upon the money markets to help pull Japan out of its worst post-war depression, Japanese individuals are now seen to be seeking higher currency returns on riskier investments, moving some of their vast domestic assets totalling 1,300 trillion yen into foreign currencies and securities. Bank of Japan data shows that total household ownership of foreign stocks and bonds climbed by 11% to an equivalent yen value of 3.2045 trillion by the end of 1999. Furthermore, there was a 60% increase in foreign currency-denominated deposits among Japanese households in 1999, reaching a value equivalent to 2.925 trillion yen. Among the households willing to hold currency under management of another nation, not quite being satisfied with the performance of their own, we wonder how big the mental shift is for these same individuals to find favor in the world's neutral currency, gold. Under the growing Japanese trend to diversify out of their own national currency, at 1,300 trillion yen in savings, the potential to impact gold is something not to be dismissed lightly.
So, that's what the BOJ has been up to. On this side of the Pacific, the Fed has also been pouring money into the system. The Fed conducted its fourth coupon pass within three weeks to add permantent banking reserves through the outright purchase of U.S. Treasury securities dated April 2003 to February 2004. This operation added $726 million in permanent reserves to the banking system.
The Fed also added a rather hefty $6.005 billion in temporary reserves through overnight repurchase agreements. Hefty, that is, especially considering the recent spate of permanent adds in addition to the two still-outstanding 28-day term repos on the books. Will American households also come to seek diversification out of their own national currency? Gold is the natural choice, albeit not the one touted by Wall St. investment houses who would be much happier to sell you options or futures on international currencies, or place your bets on an international mutual fund instead.
But in the final analysis, the only household savings in the hands of many Americans are...their houses. And these are likely mortgaged to the hilt. Walking a highwire without a safety net. Frightening.
I've been booted off Gold-Eagle! I made all of two posts, all I did was post my email and say I would like to discuss with anyone interested methods of boosting silver/gold demand via email. Vronsky sent me an email with this title in all caps:
WHY NOT BE UPFRONT?
I sent him two emails to try to explain myself and he never replied, just removed my post and booted my butt off the site!
So, it appears to me that this guy is really just concerned about his own page views, which I tried to explain I was not trying to compromise (I AM NOW YOU JERK!!!).
I've been a long time lurker/poster both here and on Kitco. I've removed my bookmark to GE. I've been told via email that this isn't the first time Vronsky has acted in such a manner for no apparent reason.
He has not removed sharefin's link to the silver pledge, so this shows that he really is just concerned with page views...what a shame.
Hello to you. To your knowledge has COMEX broken bi-laws or exchange rules in allowing this large a short position imbalance in gold and silver? Especially silver ala Ted Butlers contention that only 4 major players have shorted and manipulated silver into dirt. In short can they be sued if malfeasance and failure to maintain an orderly market is shown in the very fact that they have to resort to a TOCOM type butt cover fiasco. I would like to see them in ankle chains.
IronHead, I think you just hit the nail on the head. the interest rate derivative trade thing is THE issue.
Town Crier:
Is there anything you know to help us better understand what really are the implications of a continuing inverted yield curve?
Sorry to hear of your demise as it seemed there was an on-going thread regarding the very topic you mentioned. I wonder if they are all gone.
Just as an aside, I saw that several people on GE had requested additional functionality and his response to them was that it wasn't technically possible t because of performance issues. Rather than belittle the guy on the forum, I took the time to send him a lengthy email and explained that his performance problems where due to the fact he is using something called CGI technology on his web server which is obsolete and suggested he consider the java programming language which is much more efficient. Not so much as a "thank you for the suggestion." Screw 'em.
Hi Lamprey, just so you don't feel like the Lone Ranger, I was also canned by Veronsky. To this day I do not know why. I have participated in many forums and NEVER had this occur. I e-mailed him 3 times but never received the courtesy of a response.
Wohin sind sie gegangen? ...
Die Antwort, die weiss nur der Wind ...
The answer, my friend, is blowing in the wind ...
...is blowing in the winds of change... volatility is the new name of the game - and if you have'nt gambled for matchsticks - now's the time to "gamble for gold" ... or never "gamble" at all ... ;-).!.(-;
I've been around too long
singing the old rigged song
of getting to grips
with buying on dips.
Exuberant,
irrational sentiment,
to Greenspan's compliment
and your wealth' detriment!
I'd rather have sold
no, never my gold
though the US $
choking my collar
with all the ".com's"
-wohl bekomms! -
Sure an' it looks like we're in for a blow. The clouds are a gathrin'. The weather glass has fallen fierce these last hours. Just when we expect nothin' to happen here it comes.
Batten down the hatches and stow that new ballast as low to the keelson as possible. Put the silver aft of the gold. those bars'll balance the helm better thar. Prepare to heave to!
Why the one forged of palladium of course. The TOCOM showed its Tiger face and all aboard her were killed with no quarter. Only now when the bottle washed up did we find out the news. TOCOM froze high to allow the Tiger to escape. Ther'll be a tsunami from it sure.
Since I am not a member of COMEX, I have no idea is large
shorts have broken exchange regulations. In any case, the
point is moot, as in order for such large short exposures
to be demed irregular, they must be called to account, and
I suspect the regulatory authorities do not want to
examine this issue, lest they find illicit trades.
The last time Ted Butler complained about the level of
shorts in silver, COMEX replied that the total shorted was
still less than the total world annual production (I guess
that's supposed to make it alright, as if the rest of world
consumers could just sit idly by while shorts covered their
positions, while more Handy and Harmans went out of business
for lack of metal.) I think this is allowed to go on
because the cheaper manipulation makes silver and gold,
the more confidance the world will have in the USD, which
at last count is backed by confidance plus 3.5 cents of
gold. I think this goes on until the defaults begin, but
this bothers me not as at present prices, and with inflation
factored in, the present price of gold is about the same
as it was at the time of Bretton Woods, and silver is even
cheaper.
Perhaps you might answer the question that I posted on this forum the other day? When COMEX goes the "TOCOM" route on silver (surely the first to extinguish in supply), to what form of a market would one as a holder of metal turn to in order to avoid the discounted paper price that would surely be the one quoted during peak spikes for this metal?
Surely under the table transactions for physical metal would bring higher returns, but where would one locate the table? Where would one look to sell? When would one even know when to sell?
In other words, if one wanted to buy a contract (or sell 100 oz. physical) of palladium how would one do this right now?
Here's an Idea That I'd Enjoy Michael's Comments, Pro and Con
Gold web site aims to boost prices
By Gary Silverman in New York - 10 Apr 2000 20:06GMT
J.P. Morgan, the investment bank, and two of the gold sector's leading companies
are starting an internet site selling "all things gold" in an attempt to boost the
flagging price.
The site, to be called GoldAvenue, is backed by South Africa's AngloGold, the
world's largest gold miner, and Swiss-based PAMP, the world's largest private
gold refiner.
The three planned to sign an agreement today to form a joint venture, which was
expected to go online in the second half of this year. The three companies are
putting up $20m in initial capital for GoldAvenue's first year.
The organisers said the web site would eventually be a one-stop shop for gold
investors and merchants although its initial focus will be on selling gold to retail
customers.
Bobby Godsell, AngloGold chief executive, said GoldAvenue was an attempt to find
new gold buyers now that central banks have become sellers.
Market conditions deteriorated to the point last year that European central banks
agreed in September to cap their gold sales during the next five years.
"We have been arguing that if the gold industry is going to take charge of its
destiny, it's going to have to go out and find a customer base directly," Mr Godsell
said.
To that end, GoldAvenue will sell everything from gold watches and chains to
individual grams of the metal. For investors, the minimum balance will be only
$50.
"We want to be all things gold," said Mehdi Barkhordar, GoldAvenue's chief
executive and managing director of PAMP. "When you think of gold, you think of
us."
The organisers are looking to target the US market first, before moving into
emerging markets, where gold remains a favoured investment.
"The problem in western markets is gold investments are inaccessible," Godsell
said. "Western markets, we think, have been underdeveloped."
The organisers hope the site would eventually feature business-to-business gold
trading. However, Mr Barkhordar said the partners had no timetable for such
trading and were concentrating on getting the retail operation started before the
Christmas season.
William Winters, head of J.P. Morgan's markets arms, said the bank would
provide trading capabilities and vault services to the joint venture.
GoldAvenue is the latest in a series of internet ventures that J.P. Morgan has
announced in recent months, most of them looking to commercialise existing
businesses.
[Thanks to FINANCIAL TIMES, London, Fair Use for Educational/Research Purposes Only]
Thanyou for the link. It was very helpful in understanding the pure mechanics of the interest curve in different scenarios, as they apply in a somewhat normally functioning market. Theories for the downsloping curve we have today do point to Central Bank intervention and systemic stresses. What I don't think they cover or could even know of for that matter is the Treasury itself in there buying up and retireing the long bonds, which I surmise must drive up thier price and lower yield. Also I don't think Von Mises could have ever envisioned the magnitude of the amount of risk dollars exposed in the derivatives of bond market that are on the books of Banks,Hedge funds,Freddie
Mac,FHLB,Fannie MAE,etc.,etc.. I still don't have a clue on how this will all end up.
It seems with the Treasury buying the long end and FED raising on the short end, that they are engaged in cross purposes and the derivative time bomb is ticking.
It's about d*&% time! I've been pushing this idea for months with one gold mining company and their shareholders. I'm not sure where J.P. Morgan comes in here...I don't think I've heard their name mentioned in the short camp before, maybe they are "clean"?
My first post to this site was the "Fifth Horseman" contest where I said it was the derivative bubble (wondering about the silver eagle if anyone in the tower reads this).
I can't remember what I've read about J.P Morgan and shorting gold but I do remember this:
In my post I said that some banks were leveraged up to 100 times their assets in derivatives. J.P. Morgan is the one I remember who is leveraged 100x.
HI - HAT (4/10/2000; 16:18:14MDT - Msg ID:28410)
"Town Crier:
Is there anything you know to help us better understand what really are the implications of a continuing inverted yield curve?"
I believe to answer I shall offer my short-course: "Better Understanding Through Metaphor"
We now witness a feast wherein conventional standards play no role. The guests stand upon the table eating pudding without silverware, wiping their paws and mouths upon the tablecloth. Those with refinement have already left the table to the dogs.
Perhaps that is the purpose and only the appearance of cross purpose to deflect blame. Detonation of the derivative overhang. An attempt, (in the manner of Sir Town Crier in metaphor)to set blasts to bring down the avalanche in a relatively controlled manner so as to minimize the damage and not let the overhang grow to large. Methinks they have waited too long.
A "little" Secret......Just so you don't feel dejected, (smiles)....I know of a little group of "26" folks from GE Forum, all of which are known names from the last year or two. Some are fellow removees, like you and I, and some just like the place better. Still a forum and exchange but "No Censorship". Regards...YGM.
http://www.usagold.comLooking for a 400 point drop on the Nasdaq tomarrow? Going to retest receint lows? That's right LOWES KNOWS!!! Snooze and you loose. Buy and you'll cry. Sell at the Bell. Hold if you're bold but the big bluff may just fold.
Specifically, if volume is heavier going down than on the first half of the Tues minicrash, then most technical chart guys are going to conclude that selling pressure has increased and not diminished. They want to see a real bottom creation pattern with lighter volume and selling being overcome with strong buying coming off the bounce. If they see heavy selling volume way in excess of what they expect, then they may not cover their shorts and wait for more selling panic to arrive. Such a mystery. The Poseidon Adventure. Ernest Borgnine will get you out but you have to be willing to go with the ratty looking people (scraped up from taking losses) out through the hull. The lilly white longs are all gonna die as they can't think for themselves only following their parrothead analysts.
1st Grade Reading Primer:
See Tip form. Go Tip go. See market bounce like a ball. Bouncing bouncing ball. If Tip forms slow, market may rollover again. See brokers yell, sell, sell, sell. See Market Makers dropping bids. Low, low,lower dropping bids. Watch gold lift off like a rocket. Woosh, going up high in the sky. See Goldin sacks pull out his hammer. Hammering the spike back down. Hammering and hammering.
That's enough reading today boys and girls. Now let's all lay down on our blankets and have a short 6 hour nap. That's if anyone can sleep waiting for a 10 Dollar Spike.
Greenspan gave a deep lecture today, not a politician's usual pander. It was some profound analysis, but you get this feeling that they really aren't in control of the market and they can't even measure many factors in the equation. All I could think of was how they want China in the WTO so bad so they can import more super-cheap products to import some deflation to offset what they know is happening. Market meltdown continues. They will do exactly what they did last time in '98. Quickly inject cash somewhere less noticible to support anyone who wants to risk the farm buying a downtrend with no visible signs of turnaround. Foreign investors are the key to propping up this market. We are the shallow migrain stressed out Americans running hard with no real direction........but who has been suckered into supporting it? Sven, kookoo clock repair just isn't going to make it in 2001. Let's sell that stuff online. Sure send all your money over here. We know deregulation is a handful of bitter pills to swallow. Socialism is a wonderful way of life any boyscouts can tell you. But we are too obese to have free national healthcare. A certain percentage of our population fell into pork barrel giveaway politics. The SUV craze was a solution to obesity. Why loose weight when you can buy a bigger vehicle and take the fat with you, plus there is more room for the kids. A frugal minded population like yours in Europe can handle socialism but we have too many resources to waste. We are spoiled brats and computerization is warping our culture like a lava lamp. Nobody wanted to loose weight with Y2K coming at them. I had prepacked a 2 month food supply right here on my body.
Very interesting scenario in Japan. Imagine how you would feel if your president died and the new rulers decided to debase your currency 10 Billion yen while your job is still in jeopardy and the US stockmarket begins to tank.......
All this gold they are buying is becoming "family emergency gold" it will be buried for a long time.
O3 is a heavy molecule,atomic weight 48. Water is 20. It is created when cosmic rays from the sun bombard water molecules evaporating from the oceans. The hydrogen breaks off and streams toward the sun. Some comes from lightening but not alot. If you have noticed, the earth spins on its axis like a bastetball on Someone's finger. So as it spins, heavier molecules naturally move toward the outer edges of the sphere leaving a scarcity of the heavy molecules at the top and bottom of the basketball. The ozone "holes" were discovered "already formed" but one-worlders who want to scare everyone with waco science nonfacts insist it thinned-out and grew. Ozone holes were always there probably always will be there. I'm not impling with this slam against one worlders who also must feel comfortable working for 55 cents per hour like this "level wage rate playing field" suggests, that global warming isn't going to wreck the planet. Not wreck......just severly alter. Greenland is becoming a pasture. Alaska is farmable. The US grainbelt just moves up to Canada. And New York City becomes like Venice, Italy. What more can you ask for in a planetary disturbance? Alot better direction than the recurring iceage theory they toy with when it seems too cold. "We went fishing for Stripers today off the Manhatten skyscrapers. Lost alot of tackle getting hooked in the steel." It's Bababa..Biblical..baby. In your generation son. And New Orleans and Holland disappear like Atlantis. It's going to split the Marde Gra right in two. Oceanliners up the Mississippi. Deepwaterports ahoy. Crayfish farming in Texas. Yahoo what's a goldbug to look forward to. All that and whirled peas.
============================================================
I'm on this enviromental binge, just let me go.
EARTH'S OXYGEN DOES NOT COME FROM TREES. fact
Carbon locked up in trees has to be harvested and not allowed to return as CO2 exhaled by wood rotting organisms to produce a net production of oxygen in the tree's life. Trees growing do all produce oxygen in their lifetime. However in their death when they lie on the forest floor rotting, they give back all the carbon they ever took out of the air and consume the oxygen they gave out in their life. CO2 consumed in tree's life = CO2 given off after tree's death. All the wood rotting organisms the aerobic ones consume oxygen and exhale CO2 when eating the wood. All the fossil fuels we burn are causing global warming, but don't run around saying we are running out of air because some international banker put the screws to a third world government to pay back its loans so they mined a rainforest. It's not the loggers it's the bankers stupid. Bankers are wiping out rainforests. And we can breathe even in winter when there is no photosynthesis going on. Amazing how gamma radiation can produce our oxygen supply above the ionisphere. How about a candlelight vigil for all the bankers rotting in hell not producing any more oxygen.
THERE IS NONE ! What therefore,do you think that the owners of the floor seats are thinking of at this time ? No pit trader can make any monies without sales and therefore the seats will be coming on the market rather cheaply. Could this be the first step in the burning of paper gold ? Something is UP !
<;-)
Fed Chairman Alan Greenspan, speaking today before the National Automated Clearinghouse Association; on "Retail Payment Systems"
http://www.bog.frb.fed.us/BoardDocs/Speeches/2000/20000410.htmLike it or not, believe it or not, the Fed Chairman IS an ally to all those who hold physical gold near and dear. He seized the opportunity to prominently fold gold into his monetary remarks to the NACA Annual Meeting on the electronic evolution at work upon our settlement systems. In an extention of his past "antics", where any other speaker might have easily delivered such a speech with no mention of the yellow metal, Mr. Greenspan clearly takes efforts toward putting it "back on the radar screen," (and decidedly NOT so in an unfavorable light) revealing his own personal and continuing reverence for gold as the ulimate monetary asset.
"...the payment systems of the United States present a paradox. Our systems and banking arrangements for handling large-value dollar payments are all electronic and have been for many years. Banking records, including those for loans and deposits, have been computerized since the 1960s. Securities markets also now rely on highly automated records and systems, born out of necessity following the paperwork crisis of the 1970s. Yet in transactions initiated by consumers, paper--currency and checks--remains the payment system of choice."
"Indeed, the average consumer is exceptionally conservative and traditional when it comes to money, which has a profoundly important role in day-to-day living. To the vast majority of people, it represents the stored value of one's previous efforts. To many, it is the embodiment of their life's work. Tampering with money has always had profoundly political implications. Much of American politics of the late nineteenth century, for example, was about the gold standard and the free silver movement. William Jennings Bryan's famous "Cross of Gold" speech during the presidential campaign of 1896 reflected the deep-seated views of money's role in society and, even today, one can hear echoes of that debate in the public discourse about money."
[TownCrier Note: "PUBLIC DISCOURSE about MONEY"?? Methinks the Fed Chairman must be looking in on our discussions as his schedule allows.]
"Our history vividly affirms that the average person is far more sensitive to what form our money--our store of value and medium of exchange--takes than we payments system specialists have readily understood. It took many generations for people to feel comfortable accepting paper in lieu of gold or silver. It is taking almost as long to convince them that holding money and making payments in ephemeral electronic form is as secure as using paper.
+
"There is, of course, more to the tenacity of paper than a deep psychological connection between money and tangible wealth. Paper instruments also are perceived to have a greater degree of privacy than electronic payments, although there have been experiments with electronic money and other instruments that would provide relatively high levels of privacy. But confidence in such arrangements may take quite awhile to emerge. Currency, and to a large degree checks, are currently perceived to offer significant advantages in privacy over electronic payment systems that entail centrally maintained databases with elaborate records of individual transactions.
+
"Perhaps an even more important dimension influencing our behavior regarding money and payments is convenience. Currency and checks do not require the users to travel to special locations, dial the number of a special machine, or maintain special equipment to originate payments. This is not to deny that automation has played an important role in reducing risks and increasing efficiency in handling currency and checks. Rather, the issue is that traditional paper instruments allow the users themselves, within a structured format, to have significant control over when, where, and how to make payments.
+
Turning to the suppliers of payment instruments and services, we see that many are straddling two different worlds. The world of paper is well known and a major part of the business of traditional financial institutions. The world of electronic commerce is a new and growing part of business that is changing daily and operating on a different time scale."
"Many firms, including financial firms, have now opened channels of data communication with existing and potential customers and business partners through the Internet. In this world, particularly in retail commerce, payments by paper have been the exception, not the rule. Despite ongoing discussions about privacy and security in electronic commerce, credit cards have rapidly become the payment instrument of choice for consumers. Interestingly, there have been experiments with new payment systems analogous to private currency. To date, these products have not been widely successful, despite the fact that some have offered significant degrees of privacy and security. Instead, familiarity with and confidence in the credit card built up over more than half a century of use seem for now to have shaped behavior. Some suppliers have sought to deepen confidence by voluntarily expanding consumer protections. In a twist of history, even gold coins can now be purchased on line with a credit card."
[T.C.: He has thereby planted the seeds of thought. With this in mind, we now skip ahead to his concluding remarks which should take on additional significance to the careful reader. Obviously, he can be no more direct in his approach than this. Take it for what it is, or leave it as fanciful thinking.]
"As I have often said, to continue to be effective, government's regulatory role must increasingly be focused on assuring that adequate risk management systems are in place in the private sector. As financial systems have become more complex, detailed rules and standards have become both more burdensome and less effective. If we wish to foster financial innovation, we must first be careful not to impose rules that inhibit it, and we must be especially watchful that we not unduly impede our increasingly broad electronic payments system.
+
Thus, the private sector needs to play the pivotal role in determining what payment services consumers and businesses actually demand and in supplying those services. In a period of change and uncertainty there may be a temptation, and a desire by some market participants, to have the government step in and resolve the uncertainty, whether through standards, regulation, or other policies. In the case of electronic payment innovations, only consumers and merchants will ultimately determine what new products are successful in the marketplace. Government action can retard progress, but almost certainly cannot ensure it."
"As you begin this three-day conference focusing on new developments in the payments system, I hope that you will approach your discussions WITH A SENSE OF BOTH HISTORY and of new opportunities. CENTURIES OF EXPERIENCE have been distilled into our traditional forms of paper payments, and change has not always come quickly. Yet new technologies and new forms of business are engines for change. More fundamentally, the enthusiasm of our society for experiment and innovation reflects a strong sense of CONFIDENCE about the future that began in the VERY EARLY DAYS OF OUR COUNTRY. I am confident that THIS PAST WILL BE PROLOGUE."
[Emphasis added by TownCrier. I encourage you to read the whole affair for proper context. This has been distilled for those who might be short on time.]
Next Monday The World Bank's Development Committee will meet as part of the IMF/World Bank Spring meetings, and a report to be discussed indicates that the World Bank will try to continue its mission within limits on existing resources, but that capital increases from member countries may be needed. The report says, "(The World Bank's) financial capacity remains a cause for concern for reasons that go beyond the global shock scenario... New lending to many large borrowers which are home to most of the global poor may be constrained." Acording to Reuters, "Other items on the committee's agenda include the future role for the bank, which was set up to speed reconstruction after World War Two and which now concentrates on long-term loans to poor countries in Africa, Latin America, Asia and eastern Europe and the former Soviet Union."
Here is another timely look at some content from two TownCrier posts from Saturday (Msg ID:28317 and 28326):
-------------------------
Putting Two and Two together on the IMF gold operations...
Here's what Reuters had to say ... "the deal creates windfall profits for the IMF because...IMF gold is valued at some $48 per ounce, while the market price is around $283."
Government agencies LOVE windfall profits. Some might say such "easy money" is addictive.
Can you see how all governments might come to use such a scheme...
While we all agree that the gold derivative markets are used as a means to suppress the price (and apparent value) of gold to reap the attendant benefits of the dollar duly "strengthened" thereby, the day approaches wherein the institutional benefits will be greater to let gold run.
-------------------------
The 10-year swap spread (the gap between double-A corporate bonds and U.S. Treasuries) closed at a record high of 136 basis points (far exceeding the 119 basis point spread during the October 1987 stock market crash. Adding to the unease is the recently floated idea that the Treasury credit line currently enjoyed by agencies may go the way of the dinosaur.
Update on COMEX Delivery Notices for the April gold contract
Thus far there have been 9,715 contracts held up for delivery, representing 971,500 troy ounces of gold to change possession prior to month's end. That's 30.2 tonnes.
I watched Pt and Pd for a few years on Tocom......they were in backwardation THE WHOLE TIME.
I would suggest that backwardation is a reflection of spot demand pulling the futures.......I don't think you need to worry about silver/gold on the Comex until they are in deep backwardation.
It's still early, but I am now slowly buying physical silver walking liberty halves.....beautiful......and available at spot.....no premiums.
Source: Bridge newsAustralia's Delta CEO sees gold price above US $300/oz short-term
Perth--April 11--Spot gold prices are likely to rise above US $300 per ounce in the short term and could subsequently extend those gains, according to Terry Burgess, managing director and chief executive officer of Australia's Delta Gold. However, Burgess also noted the exchange rate has cushioned the effects of
the falling US dollar gold price for Australian producers and warned that may not be the case going forward. (Story .24584)
Black Blade: I hope so!
US' Newmont concedes that size matters in competing for funds
Perth--Apr 11--Global fund managers are making it clear to the gold industry that size matters in attracting investment. And combined with operational and regulatory considerations, this creates "compelling reasons" for consolidation amongst gold producers, according to Ronald Cambre, chairman and chief executive
officer of US gold producing major Newmont Mining Corp. (Story .10749)
I agree that greenspun has a long history of being a "closet" goldbug. I think you are certainly correct in your assessment of his content. It seems he may have an e-gold account.
http://www.usagold.comIt was interesting what you said about backwardation. Can you expound a little on it so we know what to look for as to silver and gold going into backwardation?
Today's Gold Report: Short Covering Continues, Options Expiration Friday
http://www.usagold.com/Order_Form.html4/11/00 Indications
�Current
�Change
Gold June Comex
285.00
+1.00
Silver May Comex
5.17
nc
30 Yr TBond June CBOT
99~14
+0~03
Dollar Index June NYBOT
105.40
+0.01
Market Report (4/11/00): Gold was up again this morning on light short
covering. "So far it's been quiet today but prices look supported for now on
reasonable physical demand," said one London dealer. "It could certainly go
higher -- by this time next week we'll be at or above $285." Gold prices are
"likely" to rise above $300 an ounce, says Terry Burgess, the CEO for
Australia's Delta Gold in a Bridge News report this morning. Gold trading was
sluggish in Asia overnight after yesterday's reports of strong physical
demand in Tokyo resulting from the weak yen. Thursday we get both the PPI and
CPI numbers. Friday we have COMEX option expiration which could accelerate
the short covering trend over the next few days.
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
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the gold owning public does it, and has done it for over a decade.
Just click on link above and make the appropriate entries.
Sir Thomas- I've tracked you from the Longwaves group to here and back; nice to see your handle again.
As I recall you were, or are in Japan. Since we only get what the Grabbit wants us to hear (in the US), and little has been tossed our way regarding the new Prime Minister and Cabinet changeover, I'm curious as to the political mood change in Japan since my visit last fall (family and friends). Japan being the true last bastion of a cash society, should bode well for gold, no? Most in the US would be amazed that few Japanese have ever even heard of a check. Debt and IOU's are not the norm for people that keep roughly 70K under the futon, per ea. man, woman, and dog.
I seem to recall a figure from TC (?), that Japan's gold intake 4th qtr. last year increased 25% year on year. Do you, (if still in Japan), have a feel for how folks over there are reacting to their no interest inflationary environment? Gold aquisitions increasing by the average person?
Hi, Sharefin! Love your new Gold Pledge! You're right -- at any time someone can come along and suck up all the available supply, leaving none for average investors. The time to buy is now!
Who are the people in the photo at the bottom of the Gold Pledge page?
http://www.usagold.comOhayogozaimasu, When I was in Japan in '94 I saw a row of at least 200 bicycles without one lock on them parked outside a city bus terminal. It gave me the feeling like I was at the seashore in the 70's. I saw a small shop selling $500 Italian suits from his garage and he wasn't even present to "guard the store". In these Samauri Castles they had floorboards that were nailed so they would squeek whenever someone walked over them. There welfare system for the elderly was one where the pay high prices for rice locally grown. So the older people would be out working their plots of land growing rice that they can sell for very high prices. So they see US rice exports as a threat to their welfare system for the elderly. I think they put the verb at the end of the sentence because the farmer would be talking to the samauri and would quickly change his question into a statement if he saw the expression change on the samauri's face thus saving his neck if the question was offensive. To acheive that level of obedience to conscience in our country would also require about a thousand years of capital punishment for minor infractions. I guess without tribal wars that was their way of keeping the population to a feedable number or maybe it just worked out that way.
Ogenki desu-ka? Pleasure to hear of your tales from the far side. My favorite story of honor in Japan comes from a visit to a business office with a friend working in Tokyo. Upon entering an empty room during lunch hour, I spotted a very large stack of cash (yen at 150 to the dollar - 1990), with the owner no where in sight.Querying my friend, I learned that the cash rich fellow had just sold a house, and was going to buy a car after work. My first exposure to what "cash society" really meant. Gave all new meaning to cash and carry. A lesson for me was that although Christians by and large do not exist in Japan, Christianity is abundant everywhere.
Makes me tingly all over thinking about how the price of the shiny yellow will appreciate when Japan's current economic environment leads to the only logical conclusion for it's citizens.
Would be great to hear from those in the Castle Keep, on the other side of the Pond (Pacific). I remember how gold took off when I was in Thailand back in '97 as the baht was crashing. Would be great to hear first hand how the price and availabilty of physical is doing while the currencies are girating wildly.
By the by, I REALLY enjoy your commentay on market dynamics and all- as I'd say when I had a few more hairs on top, "Faaaarm Out"!
Salutations,
IronHead
PS. The Shogun's were quite enamored of feudal thrashing amongst themselves, to quell the popualtion numbers.
http://www.usagold.comI think the silver pledge is the only one you should promote because if we divide the pledges then it diminishes the effect. We may not even generate enough for silver, but I'm all for it as I was going to buy in to silver heavy soon anyway. It really is worthwhile for silver. Silver is a strategic industrial metal. A little bit of hoarding by many individuals could move the price especially when we have a Warren Buffet buying silver and who knows how many boats are following him out to the fishing grounds. Let the gold pledge die so the silver has more impact. They are both great ideas though.
Producers Boycotting Gold Sales.....This is just a thought I've had for along time......Why not appeal to the Hard Rock 'and' the Placer Gold producers to retain as high a percentage of production in physical as possible for even 1 year. Contacting alll the different mining associations etc in a few different parts of the world could have potential for tightening the market to some extent, and we all know this is a "Every Little Bit Helps" scenario in the quest for free trading Gold!.....Regards-YGM
Things that make you say "Hmmmmmmmmm...veeerry interesting."
It's that time of the week again, and the European Central Bank has released the weekly balance sheets for the 11 member central banks.
Our newswires provided three short spots of text to convey the essential data without further explanation. It would seem that the ECB's net foreign exchange assets have declined on the week by 1.5 billion euros (to 265.0 billion) as a result of "transactions with [the] IMF."
(In an unrelated note, some of you may have missed it over the weekend, we reported on Saturday that the IMF last week had completed its original phase of authorization for gold revaluations from SDR 35 ($47) to current market value. Regularly scheduled IMF loan repayments by Brazil and Mexico were used to facilitate the revaluation of 12.944 million troy ounces of gold, raising $3 billion in "free" funds.)
On this paticular reference to the ECB/IMF "transaction", your guess is as good as mine.
Meanwhile, as the foreign exchange assets were drawn down, the ECB's total gold assets increased by 1 million euros to 115.677 billion. This increase in value could only come about by the receipt of new gold into the euro system of central banks because, as we reported last week, the effects of the quarterly "mark to market" gold revaluation were in place as of March 31. (The result was a small decline.) We wonder if it is possible that this small amount of gold was somehow obtained through the IMF transaction involving the FX assets, or if this might represent the gold income from extant gold leasing operations among the members.
Great picture. Looks as if it's part of the Japanese hoard at the end of WW II. From the look on the face of the guy in front, I wouldn't be surprised that the gold was destined for parts unknown. Bet ORO would appreciate the picture.
If I'm looking at the same picture, the man in the middle appears to be Gen Douglas Macarthur, supreme allied commander of Pacific forces during WW II. He signed for the US the unconditional surrender of Japan on the USS Missouri back in September of 1945. It was the official end of the war with Japan. I had a brother in the navy at the time on board another warship in the flotilla. Another brother was in the European theatre flying B17 bombers over Germany.
Gen Macarthur was very famous back then. When he was forced to leave the Phillipines early in the war because of the Japanese threat, he was quoted as saying "I shall return." He did. His picture wading in the surf toward a rescue boat and that quote were in all the papers.
The man to the general's left appears to be Emperor Hirohito who was emperor of Japan from 1926 until his death in 1989. His reign was the longest of all Japanese emperors. The dropping of the atom bombs on Japan convinced him that Japan could not win. He is credited with convincing the ruling council to surrender.
Several years later, Macarthur was responsible for sending American troops north of the 48th parallel in Korea in an attempt to end the fight between the North and South during the Korean War (called police action then) and against the direction of President Truman. When the Americans neared the Yalu River, the Chinese, who had been massing across the river, entered the war. The Americans could not hold them back. I had a good buddy killed when the Chinese overran his position. I was in the military then, but, fortunately for me, stateside. Truman fired Macarthur over the disobeying of his order and the bruhaha that resulted from the Chinese intervention fiasco, and Macarthur returned to the US to a hero's welcome. I remember the newsreels showing the ticker tape parade in NYC. When he retired he gave a famous gravelly-voiced speech that was broadcast endlessly and that ended with the oft quoted (back then) "Old soldiers never die, they just fade away." He loved West Point and "the Corps, the Corps." Anyway, that's the way I remember things.
Don't recognise the third man. Probably the CEO from Goldman Sachs (just kidding). Don't believe GS was around then.
http://www.usagold.comGenkides, I was in a penpal club wanting to meet a fine Asian girl after being transfered to to boondocks of NC. So we were writing and after 7 months she sent me a plane ticket. Scared to fly but flew anyway. She was a little too much older than me but really kind. I never poured my own beer. American men have been so beaten into sensetivity that anywhere you go overseas the women are kind to the extreme. A little too much psychological incompatability. I finally came back and married a sweet honey from the P.I. I eat breakfast in bed every other day if I want. I haven't washed a full sink of dishes or run a load of wash since. I fix the cars and do the Mr. fixits. 5 years all the same so far. My marrage to who the "Guess Who" were singing about would last about a day and an hour so I never got started. Serious cultural bypass surgery to keep myself sane.
===========================================================
Back to the markets
Seems like it wants to buy its way out of the hole it fell into in the morning. I think it is all very selective now and without knowing the major positions of fund managers it's a big roulette wheel in the short and near long term. The internet junk is getting bought up but what for I don't know. Some oil explor stuff is getting a lift. Utilities are dead. Tech is all on an individual basis, no judgement calls. I think it's going to rally strong tomarrow then get nailed from people wanting out who have waited. Like a wild volatility band forming that slows down and dumps real bad in a week or so. That is a pure guess but the very long shadow hammer of Tues shows serious support in the short term with pessimism constantly building as it won't go back up to previous levels. Then some major dump and crisis bleed-down. The Republicans have to monkey with the oil price and let the Alaska Rep speak out about Clinton's lack of an energy policy. How many cards do the Republican's have? Weak dollar is the other one. A stock market crash they don't want as it isn't repairable. But it is no human hand playing all this out.
===========================================================
It took me a long time to figure out what Shinto was. I would see these big Tori arches in the rivers and lakes and finally it dawned on me. They consider those supra-natural places to be holy and the arch represents a door to heaven. Kind of interesting. They follow their conscience as a religion and try to clean their minds with the spirit of truth when they meditate. Some are just going through the motions but the older people keep watch over their hearts. They answer questions based on what you thought not what you ask, mind readers. I wouldn't dare live over there too long or else you could get mush-mind as the concept of right and wrong take on the understanding of acceptable and not acceptable. I need a black and white world, right and wrong. But I think the meditation to clean one's mind is as useful as taking a shower after working in a field. Surrender to the Spirit of Truth, not organized money religion.
===========================================================
Ok for a longshot..........................The reason N. Korea is making gestures for unification is because the Chinese put them up to it. Then as they unify the hassle of US troop presence makes S.Korea turn antiAmerican. S. Korea wants nuke tech from the North so they will have to kick us out before they can utilize it. Koreans only unite when faced with a common enemy. Once that enemy is removed they fall back to for a unity against the next enemy. Once N. Korea is not the enemy, then we become the problem. So we leave the DMZ area. Now China can actually move toward Taiwan because unification is the wonderful festive occasion. N. Korea /S.Korea is China's next card. N. Korea will say we can unify only if the Americans leave. We're history. S. Korean students will be sitting in the streets with the white bandanas around their heads taking vows of starvation beating on drums chanting Yankee go home in 4 dialects. Clinton needs to send Madaline Albright over there to ride around in a rickshaw and wave alot.
I think oil will somehow go back up and the dollar down, that double whammy should give gold a high flag.
It's a composite of 2 or more photos. That's obvious from the coloration. Don't read anything significant into it. Any photo of a meeting of MacArthur and Hirohito would not have any color whatsoever in it.
Gold chart patterns, head, shoulders, channels, etc.
It is intriguing to see many gold bugs basing their decisions to buy/sell physical gold and gold mining shares, on technical analysis rather than macroeconomics factors, i.e. calling Greenspan or his bosses; King Bubba at the Oval Office, and/or Rubin at Golden Sucks. Has anybody still doubt the U.S. Markets are not rigged?
Oswald
After coolly taking past operation in stride, this one woke us up here in The Tower. The Fed today conducted its FIFTH **permanent** add to banking reserves within a three week span with an eyepopping total of $2.294 billion in outright purchases of Treasury bills. (Such permanent adds have previously been on a more rare basis, and generally less than $1 billion.)
What's more, the Fed today ALSO had a hefty temporary addition of $6.050 billion to banking reserves through well-worn overnight system repurchase agreements.
The Japanese government has finally steered the masses in their preferred direction
http://biz.yahoo.com/rf/000411/hz.htmlFollowing the Bank of Japan continuing to demonstrate their resolve to keep the yen weak and keeping returns low due to near zero percent interest rates, Japanese investors are in fact starting to dump their yen (from maturing 10-year deposits with the massive postal savings system backed by the Japanese government) on the world markets as they seek a chance to obtain higher yielding investments, including foreign assets. Of the 4.76 trillion yen in 10-year term deposits that have matured so far in April, 47 percent (equivalent to $21 billion) were withdrawn from the postal savings system. The government had been expecting a withdrawal rate of 33% over the next two years as a whopping 106 trillion in 10-year deposits reach maturity.
The yen was trading down today on Foreign Exchange markets, attributed to Japanese investors moving their money abroad. Overnight the dollar topped 107 yen, and traders are saying it could reach as high as 108.25 by week's end. Obviously, their pursuit of dollar-denominated assets provides a nice boost to the purchasing power of everyone currenly holding dollars. However, given the slim physical gold market in contrast to the vast dollar market, any yen moving toward gold will provide a boost for gold valuation far more than it could possibly boost the dollar's purchasing power.
As background, please recall some previous news we reported recently from The Tower in which gold imports by Japan have already been on the rise, with 1999 figures up by 25-30 percent.
Something is going down...
After coolly taking past operation in stride, this one woke us up here in The Tower. The Fed today conducted its FIFTH **permanent** add to banking reserves within a three week span with an eyepopping total of $2.294 billion in outright purchases of Treasury bills. (Such permanent adds have previously been on a more rare basis, and generally less than $1 billion.)
What's more, the Fed today ALSO had a hefty temporary addition of $6.050 billion to banking reserves through well-worn overnight system repurchase agreements.
Sir TC
Question?
These are T-Bills and not long Bonds?? Is it of more or less significance that the Fed is buying the short-term debt as opposed to the long-term debt? If so could you elaborate please.?
Hello.... Steven Kaplan, prognosticator, over at www. goldminingoutlook.com, was asked about the light volume on COMEX.
[FROM APRIL 10: QUESTION: Why do you suppose that COMEX gold trading has been so light recently? ANSWER: With the gold market at an important inflection point, everyone seems to be waiting for everyone else to make the first important move in one direction or the other. This also explains why the XAU has been behaving more erratically than usual, especially on an interday basis. The eventual direction of gold should be inversely proportional to the behavior of the Nasdaq. If the Nasdaq recovers and moves solidly and steadily toward new highs, gold is likely to decline. Should the Nasdaq continue to generally weaken, especially if it does so with large interday moves in both directions, gold will respond strongly to the upside. The latter is a far more likely possibility.]
Well thats his take and I would add the observation, that he seems never to infer in his observations, that more and more "traders", are recognizing what a big CON game the COMEX is and are realizing how rigged it is against the little guy. They may not want to play anymore.
Also, this light volume may have something to do with what FOA alluded to in the last Trail Walk of things beginning to cook behind the scenes.
I myself see potential for a good move up in here, with prices maintaining at $300 + level after move.
I did in fact say Treasury BILL in my report, and so it is. Today's operation involved the outright purchase of these short-term Tresuries. The Fed targeted nine bills due between April 20 through August 3rd of this year.
In contrast, Monday's operation to add permanent reserves involved the outright purchase of longer term Treasury notes (target dates April 2003 to February 2004). I have a fair recollection that the previous three permanent adds were longer term securities also.
From my own recollection, doing permanent adds with short-term bills is not typical. It's just too simple to wait until maturity of these short-term bills to get at the cash. So while today's permanent add operation strikes me as rather odd on several fronts, I have yet to divine the implications.
http://www.usagold.comI believe the Fed is buying some short term debt to alleviate the inversion problem that has always been the precursur to a recession. The yield inversion is the target, to reduce it. Any thoughts?
Mr. Greshem, $5 Indian, Iron Head toe ok-san! O-ki kum-bow-wa.
Mena yoku Nihon-go o-hanashi-mus.(can't spell in either English or Japanese.)
Was in Japan for 5 years many years ago. At that time ALL foriegn imports were tightly controlled by the Japanese Government. Possible the Government set the quotas on everything imported. Some things had very high import tarrifs. American cars were in high demand, but not too many made their way to the Japanese streets because of the Government restrictions.
Has This Changed In Japan?
The reason I ask is, if their are no restrictions on imported Gold Coins,Bars, or Wafers from the Japanese Government......Watch Out for Huge Demand from the Japanese public.
Jewelery may or may not fall into a different catagory.
Did anyone notice any coin shops, or places where Gold bullion may be bought or sold, in recent trips to Japan?
In Kyoto Japan there used to be a famous temple called; "Kin kaku Jin- The Temple of Gold"( If I remember right the roof was real Gold). Visitors had to view it from a distance across a small pond, seems although paper wealth was sometimes flaunted in public, real wealth(GOLD)was only viewed from a safe distance.
I never saw a Gold coin while I was in Japan. Anyone else ever see one over there?
.....beesting.
J.P. Morgan, the investment bank, and two of the gold sector's leading companies are starting an
internet site selling "all things gold" in an attempt to boost the flagging price.
The site, to be called GoldAvenue, is backed by South Africa's AngloGold, the world's largest gold
miner, and Swiss-based PAMP, the world's largest private gold refiner.
The three planned to sign an agreement today to form a joint venture, which was expected to go
online in the second half of this year. The three companies are putting up $20m in initial capital for
GoldAvenue's first year.
The organisers said the web site would eventually be a one-stop shop for gold investors and
merchants although its initial focus will be on selling gold to retail customers.
Bobby Godsell, AngloGold chief executive, said GoldAvenue was an attempt to find new gold buyers
now that central banks have become sellers.
Market conditions deteriorated to the point last year that European central banks agreed in
September to cap their gold sales during the next five years.
"We have been arguing that if the gold industry is going to take charge of its destiny, it's going to
have to go out and find a customer base directly," Mr Godsell said.
To that end, GoldAvenue will sell everything from gold watches and chains to individual grams of the
metal. For investors, the minimum balance will be only $50.
"We want to be all things gold," said Mehdi Barkhordar, GoldAvenue's chief executive and
managing director of PAMP. "When you think of gold, you think of us."
The organisers are looking to target the US market first, before moving into emerging markets,
where gold remains a favoured investment.
"The problem in western markets is gold investments are inaccessible," Godsell said. "Western
markets, we think, have been underdeveloped."
The organisers hope the site would eventually feature business-to-business gold trading. However,
Mr Barkhordar said the partners had no timetable for such trading and were concentrating on getting
the retail operation started before the Christmas season.
William Winters, head of J.P. Morgan's markets arms, said the bank would provide trading
capabilities and vault services to the joint venture.
GoldAvenue is the latest in a series of internet ventures that J.P. Morgan has announced in recent
months, most of them looking to commercialise existing businesses.
Compliments, Always Appreciated, This one on Kitco, by Goldfever
We also wish to remind our readers of two additional sources,
and resources, for building an understanding of the
importance of precious metals investment markets:
http://www.usagold.com
which includes Mr. Michael Kosares' monthly newsletter,
"News & Views", which he still offers, generously,
virtually priceless, yet free.
Mr. Kosares is one of the excellent and dedicated sources
for those considering investments in physical gold
and/or silver coins and bullion.
Located in Denver, Colo., 'USAGOLD' can be reached
at 1-800-869-5115.
The Japanese investment flows out of Japan from the Postal Savings system could come to 1/4 of the $1 trillion balance over the next 2 years. The result would be a $30 billion per quarter supply of Yen over that period. One might think this would support the dollar. However, the Yen deficit in the international Yen markets is $174 per year (4Q moving sum for Q3 99), or $44 billion per quarter. Perhaps this flow would encourage fresh borrowing in Japanese Yen that would be effective in ameliorating the Yen deficit. Absent this, the Japanese CB would simply not need to purchase as many dollars per year as it normally does from its exporters, who generate $100-125 billion per year, mostly in dollars. In any case, the Yen deficit would be that much greater once the funds stop flowing out.
I expect that the Yen deficit 2 years hence (in the case of the flows hitting the global dollar markets) will be raised by the amount of Yen due as return on investment, approximately $10 billion of extra Yen demand. Q3 99 saw a $70 billion rise in multinational Bank's external Yen lending (outside Japan), which was only $11 billion above the required add. If this new lending continues a short while longer - say 2 more years, and the investment flows come about, the $0.600 trillion in Yen denominated global debt would mushroom to $1.100 trillion, with some $70-80 billion needed every quarter for making interest payments. Even at 0% interest it is questionable whether Banks would be able to lend at a high enough rate to supply that much each quarter.
Last go-round, the Yen carry trade collapsed at just under $0.7 trillion in Yen debt. Without a substantial trade deficit (as opposed to the current big trade surplus) this new carry trade and its expected brother - investment flows - would self destruct well before the end of the second year. As this possible process starts, the BOJ had still pumped out some $50 billion in Yen and bought treasuries over the past 2 quarters. Meaning that the global Yen deficit could not be met by investment flows and new international lending. This carry trade seems to self destruct before it even got started.
"We also wish to remind our readers of two additional sources,
and resources, for building an understanding of the
importance of precious metals investment markets:
http://www.usagold.com
which includes Mr. Michael Kosares' monthly newsletter,
"News & Views", which he still offers, generously,
virtually priceless, yet free.
Mr. Kosares is one of the excellent and dedicated sources
for those considering investments in physical gold
and/or silver coins and bullion.
Located in Denver, Colo., 'USAGOLD' can be reached
at 1-800-869-5115."
Rhody, Welcome to our discussion - we often discuss your posts from Kitco, so you are part of it anyway. The TOCOM did what we were expecting to see in gold eventually. The physical deficit relative to the paper surplus is on a much greater scale than Pd. I would expect that the breakup of the paper markets would not affect physical trade as much as we may have feared. The TOCOM showed that separating 1/5 of the paper from the physical Pd did not prevent other paper markets or the physical market from continuing routine ops. The TOCOM paper continues to trade though there is no true connection to the underlying item. It is now a passive index trading instrument - like the SP would be with no need to deliver stocks. All trades relating to the TOCOM Pd must be hedged separately. The fact that the longs don't take the TOCOM contracts as substitutes for Pd holdings is that they need the Pd to put in car pollution control equipment etc., and the paper does not hold hydrogen nearly as well as the metal. The other global contracts were priced at a steep discount to the metal till the TOCOM shut down delivery options. Now that delivery is no longer an issue there, the Pd spot and futures are back to normal relationships. Why? Because the shorts and longs are back to functioning as traders on indexes, where the underlying item is "free" of direct commitments to the paper market, and therefore, there is no more of a non-financial commitment involved. The longs that want metal can buy it from supplyers, the "speculators" and hedgers who want the price action can index to the purely financial Pd index rather than have the option of actual metal being delivered. The Pd contracts are now plainly dependent on actual supply and demand for the Pd metal, rather than the supply and demand for fulfillment of odd obligations. Now a holder of Pd can hedge by selling a future on TOCOM without fear of having to deliver the (possibly irreplaceable) metal upon settlement. This led to the growth of hedger supply in the Pd paper market, while eliminating demand from physical Pd consumers who now have only the spot market from which to take delivery. The shorts are no longer in danger of delivery demands but exposed only to "actual" demand.
---------------------------
Penny
The US flooding of the Eurodollar markets (dollar currency markets outside the US) comes against a backdrop of severe shortage of dollar assets in the private bank system (there are many more dollar liabilities). Dollar bank liabilities (checking deposit balances etc.) are in great suplus and the surplus grows as the US imports more "stuff" and exports more dollars. The Banks are still squeezed for dollars because the Japanese Central Bank, the BOJ, is sucking out the excess portion of dollars, so is the Chinese CB, and those of Taiwan, Korea, and most major developing countries.
To take in the excess that is not taken by the CBs, the rest seems to be settled in physical gold so as to maintain the dollar's value relative to the "hidden" SDR as well as the public SDR.
The demand for dollars to settle interest payemnts abroad is now, for the first time, below the combined supply from new lending and that from the US BOP deficit. There are many ways to measure this. In the broadest measure, considering bonds as nominal assets (they are definitely not because their value changes with interest rates and they do not necessarilly create fresh currency), though there is excessive dollar supply, and there usually is some excess, there is a far greater excess of Euro. The Yen is at spectacular deficits. The dollar is in deficit since Q3 99 due to the sharp decline of dollar bond and bank debt issuance.
In the narrower bank debt and bank currency markets, there has been an excess of dollars since 1994 if the BOP is considered. However, the dollar liabilities of foreign banks have been very large relative to their assets and are not decreased in full proportion to the US BOP deficit. This is the result of intentional action by the CBs of these nations accumulating of dollars with the obvious purpose of supporting the dollar. The BOJ has been the greatest supporter of the dollar. EU member CBs have been eliminating or stopping fresh support efforts. A few have been reducing dollar balances. Newly industrialized nations have increased dollar reserves substantially, as their dollar income from exports skyrocketed during the Asian crissis. At some point, these dollars will have to run after something tangible.
In any case, foreign banks have been under pressure from the actions of their home CBs to obtain dollar assets. Therefore, the great need for dollars and the support for US imports. Foreign individuals and corporations have accumulated an excess of dollars, however, the banks that hold these cash balances have come to the point of having a deficit of dollar assets and are being kept that way by the CBs overseeing them. As the dollar asset deficit at foreign banks continues to develop and the excess of Euro continues to grow at greater speed than the dollar excess, the dollar will remain under upward pressure.
The Eurodollar rates are particularly revealing in their rise despite US yields coming down recently. These indicate a shortage of dollars in the international banks. The short term interest rates in all developed countries and in most NICs is lower for domestic currency than it is for dollars. This differential in rates is created by the Fed raising rates while the rates offered by local foreign banks drop or stay the same. The Fed is trying to keep the foreign holders of dollar cash balances from using the dollars to buy real goods, particularly American goods. The fact that higher rates can be obtained in the US causes dollars to flow from the foreign investors into US debt markets.
The TED spread between the bond and the Eurodollar also indicates a dollar shortage in the foreign dollar markets. It is now above a full point beyond treasury bonds.
However, as the cash balances of foreigners and foreign CBs accumulate, the US debt position continues to deteriorate. The slowing of the issuance of new dollar denominated foreign debt has the effect of creating a deficit in dollars NOW, while assuring an excess LATER in the future. The treasury buybacks are part of a combined effort with the Fed to keep foreign funds flowing into the US while preventing the creation of long term obligations that would exacerbate the rates of dollar export in the future. Foreign buying of Mortgage debt that had implied guaranties from the US government is only good for the dollar if the gaurantees are withdrawn. Otherwise, when the fight for the dollar is out in the open and the Fed tightens the local money supply, the mortgage debtors will increase their default rate beyond the allready high levels seen today, and the government will be asked to fill in the void as it has done so far. That would not allow the government to avoid asking the Fed to monetize US debt as it grows due to high payments to higher yield mortgage bond holders facing defaults. As a result of not cutting the connection of Fannie and friends to the government, the war for the dollar would be lost earlier.
The noise from Treasury and from Europe about reporting transactions of individuals and corporations involving tax havens and free banking centers to the government is part of a preemtive move against more Americans and foreigners leaving the US with their assets and funds and not parking those in Light Socialist Europe or Mercantilist Japan. The excuse is "money laundering" and "financial crime". If there is any degree of likelyhood for success in this action, the big money will leave the US that much more quickly and will definitely not come back. Treasury's wording of the suggested legislation is such that it would be able to allow "friends" of the administration to exit, and maintain forced copatriation of funds with their owners and expatriation of any who might expatriate their funds. If this is reminiscent of the 100% confiscatory exit taxes that Nazi Germany put on exiting Jews (among others), know that the resemblence is not coincidental and that this is the time to transfer assets abroad and to set up arrangements for life outside the US.
Note on interest rates:
Current real interest rates in the US as calculated with my partially corrected CPI (about 6.5% price inflation y/y) are near 0 across the whole yield spectrum on US government debt, and only 1.5% to 2% in the mortgage and corporate arena. There is no mystery in the "cash is trash" mentality. People are unwilling to hold cash without good interest rate compensation. Any excess cash goes to the purchase of what is perceived to be real assets, corporate stock, real-estate, and of late it has spread to high end furniture, antiques, and high priced cars.
The hidden price inflation of the Klintoons is why M1 is flat and MZM (includes money market accounts) is doing all the growth.
---------------------------
Goldman and Merryl. and the market save of 4/11
It occurred to me tha Goldie and Mary were front running the government before its madcap intervention in the markets. It is very likely that the initial buying that ocurred in the earlier phase at 11:30 to 12:30 yesterday (which was the bulk of the money inflow) was not the attempt by Goldie, Mary and friends to support the market, but to front run the government before it starts a pre-arranged intervention at 13:00 in the gold market, the forex market, and most of all in the stock index futures market.
The reason I see this as more likely, is that despite an enormous incoming money flow, the market continued tanking like tomorrow was cancelled. This means that bids were put in below the market in order to catch "stuff" that is falling. The government intervention is quite the reverse - it puts up bids ABOVE the ask with intent of raising prices, not of making purchases for profit.
During the government intervention period when prices were climbing as if all sellers disappeared, the buying was met by aggressive selling all through the incredible (and totally artificial) price rise.
The illegal, though sacred, Wall Street practice of screwing your stupid clients is completely intact. The most stupid client is the one that does not care for the price he pays, the government is this client, the idiots are the taxpayers. But "someone" was bailing out big time since 1995, and the government was not it. Quite likely, the government was the swing buyer, when money flows turned negative, the government bought. "Someone" though, sold some 2 trillion $$ of stock throughout this period, and of late, this was at a rate of some $400 billion a year, likely to grow to near $500 billion for 2000. Needless to say, these sellers are the ESOP cashers and the "smart money" that needs to exit the markets gradually because it is too big to make a quick move.
Sell to whom?
The government is doing a good business in supporting the markets. Small investors, even ESOP cashers, are putting money into stocks. The large sellers are paying capital gains taxes (when they have to), and the government gets the 32-36% income tax on the ESOP cash outs. It stands to reason that the government would support this process (supporting PPT actions) as long as it results in greater payouts than were possible with straight cash wage payments.
Fortunately for the markets, some ESOP cash-out money flows back into the markets into IRAs and 401ks. The big chunks, though, might be going abroad to seek shelter, or move into Valley realestate and German sportscars.
----------------------------
Effects of PPT, stock options and the real interest rate
The PPT action focuses on buying index futures. An interesting side effect of this is the resultant outperformance of the large cap indexes relative to the rest of the market. Looking at the ND 100 relative to the Nasdaq composite, and the SP100 and SP 500 relative to the total market index, we can see when these interventions occur, when they are traded out, and reach some conclusion as to what portion of incoming funds is attributable to stock index purchases.
Furthermore, the index buying puts disproportionate favor on the stocks that have low floats - those that have a small number of shares trading on the markets relative to the market capitalization. So the goal of every CFO (Chief Financial Officer) is to get his company into one or more of the sacred cap weighted indexes, or to maintain membership. Once the stock is a candidate for introduction into an index - particularly for internet and other young tech companies, the stock enjoys government sponsored support during market sell offs and momentum shopping during bull moves. As the stock appreciates and moves up into more indexes, particularly the SP500 and SP100 as well as the NDX, increasing numbers of funds mimicking the indexes are forced to buy the stock, bidding it up further. Having sponsorship from Fidelity, TC/AC or Janus helps as well.
As time goes on, the inclusion in the bigger stock indices increases the number of shares the company can issue to its management and top talent, thus making the company's apparent profitability greater than that of its competition outside the indices. "Winner takes all" is reinforced by this process.
Companies that continue being favored by the markets because of stock buybacks are borrowing 80% of that money and are redeeming a big chunk of the $400-440 billion in ESOPs for 1999. One third of this money is sucked by the Federal government and is responsible for the whole of the reported budget surplus. Without this, the Federal government would be so deeply in the red that we would have thrown Klintoon out of office at his second try in 1996 and the composition of congress would have been very different, as would have been the issues of the current election..
------------------------------------------
I will have to refrain from posting more long posts because of the upcoming tax deadline and some business I need to take care of. The above are more partial, incomplete posts that I did not have time to finish. Will be back when I can.
Oro said, "...As time goes on, the inclusion in the bigger stock indices increases the number of shares the company can issue to its management and top talent, thus making the company's apparent profitability greater than that of its competition outside the indices. "Winner takes all" is reinforced by this process.
"Companies that continue being favored by the markets because of stock buybacks are borrowing 80% of that money and are redeeming a big chunk of the $400-440 billion in ESOPs for 1999. One third of this money is sucked by the Federal government and is responsible for the whole of the reported budget surplus. Without this, the Federal government would be so deeply in the red that we would have thrown Klintoon out of office at his second try in 1996 and the composition of congress would have been very different, as would have been the issues of the current election..[..]"
He is saying that the budget surplus is a direct result of ESOPs and stock buybacks...in other words a tax loophole. OUR WHOLE TAX SURPLUS IS DUE TO A TAX LOOPHOLE!!!!
South Africa's annual Gold production expected to fall below 400 tonnes.
http://www.woza.co.za/reuters/apr00/gold11.htmMr. Chris Thompson CEO of Gold Feilds Ltd. Says: South Africa's market share of world Gold production has declined to about 20 percent. Click URL for full news release.
Comment: If South Africa's yearly Gold production is now under 400 tonnes, and they're still the worlds number one producer of Gold,.....How much is the worlds second largest producer, The United States, producing in a year???
In recent posts right here on USAGOLD from Nov. 1999(105 tonnes exported to Japan per Sir T.C.) till now Apr.2000, if my memory is correct, the U.S.has already exported over 250 tonnes since Nov 1999. Another 61 tonnes was minted and sold in U.S. Gold coins in 1999. The reported figures are showing U.S. projected Gold sales in excess of 400 tonnes per year. If the U.S. is second in world Gold production...WHERE IS THIS GOLD COMING FROM????
Sir TownCrier do you have the actual figures on U.S. annual Gold production?
I've searched the World Gold Council site and other various sites with out success!
Again, if U.S.annual Gold sales are exceeding annual Gold Mining production---Where is the Gold coming from the U.S. is selling annually???...beesting.
You got it right, but it is not exactly a loophole.
The idea must have been to reduce the cost of management and talent and exclude some of their income from odd payroll taxes - income that would otherwise have shown up on corporate balance sheets as a cost to the corporation, frightening off investors allarmed by the cash flow. The "stock flow", being a new phenomenon (outside of bottomless convertible shares), was easy to disguise, and eluded thousands of analysts.
The alternative was to lose every new industry to foreigners in Asia because of the high cost of talent in the US and the appeal of alternative sites outside the US (ah... the breeze on the Caribean beach) for corporate headquarters.
Once it got out of hand, the practice became too big for undoing and all that remained for government was to figure out how to make use of it. Well, they did make use of it and the return on ESOPs has become the largest component of corporate profits and a significant fraction of cash flows - up to 20% at some companies.
The only real things are the imports and the consumption of them.
Automated internet based inventory and contract management methods still have a little bit left in cost reduction - 5-10% by the end of 2003 - but once that is in the system, the Chen Woods story is finished because local distribution and retailing costs will come down to meet costs of foreign imports, and importation will be back to its original significance in measured GDP - a negative.
Sir $5 Indian and others...thoughts on yield inversion
I am no authority on this matter, so dismiss this thought as it might seem appropriate to do so.
I don't see the Fed purchase of these short-terms (T-bills) as having any strong effective connection to an official desire (be it actual or imagined) to ameliorate the Treasury yield inversion. Particularly, as I see it, with the Fed's target rate for the trading of fed funds at 6% (and poised to be raised yet higher), the Fed would be acting at cross purposes to itself in dealing with the yield inversion through an operation that would support the short-term prices...lowering the effective interest rate. In short, I see no relation between today's method for a permanent add of funds...unless, of course, it was done in such a manner as to avoid aggravating the yield inversion by putting more buying pressure on the long terms.
Ultimately, as I suggested yesterday, there seems to be little to be gained evaluating these prevailing table manners...because the feast has been left to the dogs. Confused instincts of unsophisticated players acting in an unnatural environment.
Excellent memory! But one correction to your recollection is necessary...not all of that November gold went to Japan. They were exports in general...to all points away from U.S. shores, nothing more specific. It was yet another post wherin I cited the rising Japanese gold imports.
I shall send my minions to the archives in search of the first post to help answer your question on U.S. gold production versus our current exports.
More for Sir beesting on U.S. production versus gold exports
Excerpts from TownCrier (3/23/2000; 21:07:26MDT - Msg ID:27386):
- - - - - - - - - - - - - - - - - - - - - - - - -
...I'm glad you noticed the startling trade figures I posted two days ago (March 21st, a.m.) focusing on the trend of huge gold exports from the U.S. It surprises me that this didn't raise more eyebrows or comments among our group here. Worth repeating is that the gold that moves into foreign ownership but that is maintained in U.S. storage does not get counted among these export figures.
...[I]n providing my speculation as to the source of this gold. Here it is...but before I continue further, here is a brief review of the figures:
---------
TownCrier (03/21/00; 08:50:39MDT - Msg ID:27209)
...We created quite a stir in January when we revealed that the latest release of data from the U.S. Department of Commerce indicated a rocketing level of gold exports from the U.S., with November's gold exports (that level passing through customs, not including any transfer of ownership that stays within the vaults of the Federal Reserve on behalf of the foreign owner) leaping above October's $400 million export level to top $1 billion. In December, that number settled back to the still impressive level of $783 million, while in January gold exports continued to tip the scales at $730 million.
...
To assist you with your own quick calculations to determine the significance of these levels, gold at current prices is about $10 per gram...with one million grams per tonne you have $10 million per tonne. That gives you 22.5 tonnes exported in January of last year pointing toward a 270 tonne annual pace...but recall that November alone grew by 100 tonnes. Meanwhile in modern times, this January's export of 73 tonnes puts us on an annual pace of 876 tonnes. See a trend? Are you getting your share of gold even as the rest of the world is laying claim to theirs?
------
Let me begin with the additional perspective-builder that according to the Gold Fields Mineral Services Gold Survey 1999 (Update 2), the U.S. produced 354 tonnes of new gold from our sovereign soil in 1999.
So, on an annual export pace of approximately 876 tonnes judging from January's "slackened" export level, compared to our annual production rate of 354 tonnes, you can see that this gold is more than double the amount that our mining companies might be providing in the form of gold loan payments and outright sales channeled through the likes of the LBMA member banks. What is making up the bulk of the shortfall beyond the first order supply? We can probably take a cue from Michael's own operation at Centennial where he has agents seeking and negotiating for the caches of Old World treasures. As private holders, for whatever reason, reach a state of mind that they would prefer to exchange their hard assets for national currencies, this gold enters the export stream alongside new production.
With our current equities markets beguiling and captivating masses of sophisticated and unsophisticated investors alike, is it any wonder that tonnes of ounces are trickling out of the woodwork to fill this overseas demand? After all, there is only 32,151 troy ounces in a tonne. Create enough disinterest among individuals to give up their few ounces of near-irreplacible metal for a few hundred dollars of instant cash, and you can see that the difference can be perhaps be satisfied...for a while. At these rates [that is to say, at this pace], it won't last long...
- - - - - - - - - - - - - - - - - - - - - - - - -
http://www.usagold.comI want to see some of those middlemen dealers buying on the Hong Kong exchange and if I don't see it then all this Asia-buying is a latter event. If you want a monitoring of Japanese gold buying you might want to check metal dealers in Hawaii. Too many middlemen in Japan tagging on premiums for the thrifty shoppers that they are to be so fooled. No, the mall shopping trips to Minnesota and vacations to Hawaii......that is where you'll see the buying. Like cameras or laptops or anything else, it's always cheaper outside of Japan. When I was there I had a large stack of old currency notes I was trying to sell and the coin shop guy looked like he hadn't seen a customer in months. People were into stairing out into space as to being "employed". 7 teenagers working at a soba noodle shop with no customers. One construction worker on the machine wearing white gloves, one in the hole digging, two up above looking down, nobody dirty.......active site.......major recession in full swing, 45RPM scenario. I think the banks just take it all on the chin, they don't "shake down" their customers and force liquidations. No one making money and no one out crying in the streets. Bad times are pileup debt times for everyone. Nobody looked worried about the slow economy in 94.
So you heard it from the ORO, only index stuff is getting full gubermint support. That word "long" sounds so scarey right about now if not in conjunction with "gold". Long gold, now that's ok.
"Gore...the euro, ... won't pose a threat to the dominance of the U.S. dollar in the international economy until the 11 nations joined in a common fiscal policy..."
Well, he obviously does not understand what is before him.
Since the Euro currency is not related to the indebtedness of the EU member nations, fiscal policy has nothing to do with it since the ECB does not set rates for (or against) the governments. Contrary to his observation, the biggest plus is that the Single currency, capital mobility, and (theoretical) labor mobility forces each country to compete with the other in attracting capital with low tax rates, better educated labor and easier regulatory burdens. They have little time to wait till the governments are forced to act.
I await a French Hi-Tech colony in Southern Ireland.
Bingo. And in regard to capital/labor mobility between member nations, the dictum of Maastricht was to tear down barriers. Maastricht also contained additional elements meant to address and smooth potential social issues associated with this expectation of freer, liberal movement of individuals and their wealth among these various member nations.
About 15 years ago, a friend of mine used to smuggle diamonds into Japan. It was very lucrative because the import tariffs were extremely high, but he could only do this because he had an inside contact.
About ten years ago, another younger friend was smuggling in relatively small amounts of cosmetics to Japan, which helped pay for his air tickets there. I concluded from this that the overall import tariffs must be ridiculously high. That was true.
My question now is, if import tariffs on diamonds were high 15 years ago, were gold import tariffs? Are they still?
Thank you both for the quick responses.
So, 354 tonnes is the official U.S.annual Gold production figure.It looks like a huge amount of U.S. Gold is leaving our shores.
Next question: Anyone know what U.S. domestic Gold consumption is???(61 tonnes of Gold Eagles in 1999)
A lot of Gold jewlery is imported from Italy and Thialand,but I would wager U.S. domestic Gold consumption added to Gold exports far exceeds the 354 tonnes officially produced from U.S. mines.
It seems like there has to be a shortage of Gold soon but all of us here have been waiting for supplies to run low for a long time.
I just can't understand why more people with excess paper wealth don't convert some paper into untaxed long term Gold ownership with a potential for long term appreciation....beesting.
I have just started accumulating.....and the market is thin.....so we need to tread lightly......but I think that if you go to an auction site and you bid slightly higher than what dealers pay, you should not have a problem buying at a good price.
I have been studying/trading Japanese futures for the past couple years, and I have found that backwardation is a key concept that is worth studying. I watch for it EVERY DAY.
What is it?
http://www.tocom.or.jp/souba/souba_e.html
Look at Tocom platinum. A gram of Platinum in Feb. 2001 is 250 yen cheaper than a gram in April 2000. That is Big Time backwardation! It means that traders are thinking: "we want the product, and we want it NOW. NOT in the future." Spot demand is "pulling" the futures.
Now look at Tocom rubber....rubber now is cheaper than rubber in the future. Traders "might want the product eventually, but not now." This is called "contango".....
You can check the US futures here:
http://www.futuresource.com/prices.shtml
You will see that oil and gasoline are in backwardation......people want it NOW......gold and silver are in contango.....no one is hurrying to buy it (at least not through the futures markets).
I did not check TOCOM volumes, but the COMEX etc. were functioning as usual but without the severe backwardation of the last few years. The Paladium debt was turned into a pure paper bet. That TOCOM trading in Pd ceased is a different issue.
What are catalyst producers doing to obtain Pd?
As for Japan, what is your take on the upcoming departure of funds from the Postal savings system? Who will buy the JGBs now that the postal funds are exiting the confines of that limited dsvings?
By the way, I liked some of your posts at other boards.
I will not take the time to explain. Just to say that the currency is in excess when it is significantly above 0, and that it is in a deficit when it is below 0. These balances do not contain the trade deficits and investment flows because they are static snapshots of the banking system which correspond to the dynamics of financial flows.
Cash balance preferences are not necessarilly reflected in these charts.
Solely currency creation (borrowing) is considered on the supply side and interest payment and rollover demand is considered on the other side.
http://uk.news.yahoo.com/000412/5/a3cbe.htmlLONDON (Reuters) - Ghanaian mining company Ashanti Goldfields Co has reported a loss for 1999 after exceptional charges following a tumultuous year in which it came close to collapse due to huge derivative losses.
Africa's third biggest gold producer sank to a loss of $183.9 million (116 million pounds) in 1999 from a profit of $40.7 million. Earnings before exceptionals were $66.1 million from $73.9 million.
The exceptional charges of $250 million included a $171.1 million write-down of fixed assets at the Obuasi mine, mainly arising from the planned closure of surface mining.
I think that Tocom was always a minor channel for actual Pd users....it was probably mostly used for hedging.....and occaissional delivery.
I would guess that they have some contracts with producers......and that they are also in a bit of a bind while they wait for the Russian metal.
This is all speculation....but I think the PGM crisis is far from over, unless other autocatalysts are used.
"As for Japan, what is your take on the upcoming departure of funds from the Postal savings system?"
I really don't know how much will actually leave....interest rates are negligible everywhere in Japan...would you get excited about moving from 0.25% to 0.29% or whatever the differential is?
Some will go to stocks......some to real estate....some to Nasdaq tulips.....
Many Japanese cos pay dividends that are higher than bank interest rates.
"Who will buy the JGBs now that the postal funds are exiting the confines of that limited dsvings?"
I'm not sure, but they can always get the BOJ to buy them, right? I think they may become more bold in taking inflationary measures, as prices are still very low here.
We shall see!!!!
THC
By the way, I liked some of your posts at other boards.
Johannesburg--Apr 11--South African gold producer AngloGold is adamant that a sound business utilizing Internet technology will lay the foundation for e-commerce success--not the other way around. Anglogold, financial services group J.P. Morgan and Swiss refining and manufacturing company PAMP (Produits
Artistiques de Metaux Precieux) on Tuesday launched GoldAvenue, an e-business venture. (Story .18196)
Black Blade: Ya know that this has to piss-off Barrick! They were even against the proposed milleneum coin - go figure!
Analyst says fall in Australian dollar may boost gold output
Perth--Apr 12--Australia's gold production could rise if new gold projects awaiting development are helped in getting the go-ahead by the recent decline in the Australian dollar, according to Sandra Close, analyst at mining consulting group Surbiton Associates. (Story .10366)
Black Blade: Yeah, more gold projects, more short-selling, dig yourselves into a deeper hole mates! There is a price to pay ya know.
May futures fell 2.8 cents to $5.137 per ounce yesterday on the Comex division of the New York Mercantile Exchange, but maintained most of Tuesday's price gains. "Silver also benefited from the equity markets losses, but unlike gold, it will continue to look good as an alternate investment because of the lack of a central bank threat," said Dave Meger, a senior metals analyst at Chicago-based Alaron Trading (HUH!)
Black Blade: Should we let him in on the secret that the CB's stopped selling and leasing Au last year? What a bone-head!
Might we not construe the new trend to internet gold sales...
as a replacement for COMEX and LBMA? Perhaps these companies wanting to commence said e-commerce sites are distrustful or apprehensive of the commodity exchanges' abilities to be exchanges and feel they must provide their own outlets that will by-pass traditional gold and silver exchanges. Hmm?
My thoughts exactly! Now if some NA producers buy the assets of bankrupt Handy and Harman, well then......, the end of Comex as we know it, and who cares if they default like TOCOM did with Pd, etc. etc. Lots of possibilities.
http://www.usagold.com/Order_Form.html4/12/00 Indications
�Current
�Change
Gold June Comex
282.10
-1.60
Silver May Comex
5.12
-.02
30 Yr TBond June CBOT
98~07
-0~05
Dollar Index June NYBOT
105.63
+0.02
OPINION
(4/12/00)
Gold was down on the COMEX in the early going as is usually the case in the
trading sessions before options expiration day (Friday). There was little in
the way of news to explain the downturn other than a sense that the financial
institutions short the options market have little interest in allowing call
options to graduate to the profit side of the ledger before expiry, if there
is any way at all it can be prevented. One wonders why anyone would ever buy
a call option, since the number of instances where one could have sold that
option at a profit are few and far between. The odds against the call option
buyer are slim in the extreme, and when they do move in the bull's favor
something comes up to undermine the very structure of the market as occurred
recently with palladium on the TOCOM. Don't bet against the same happening
with gold on your favorite exchange at some point in the future.
We continue to counsel individuals to purchase the physical metal, keep it
nearby and avoid the commodities and options markets at all costs for obvious
reasons. We do not say this because we are in the physical gold business; we
remain in the physical gold business because we have believed this for a long
time. When you study the history of gold in the 20th Century, one cannot walk
away from such an investigation without the clear knowledge that certain
highly centralized governments married to fiat money, government deficit
financing and the high tax rates required to support it are also wed to the
proposition that gold must never be viewed by the people as a valid
alternative to paper assets. Why? Because the moment the system falters, the
public would flock to yellow metal making things considerably worse for the
proponents of big central governments, their attendant central banks,and
socialist political parties. Hence the incredible machinations to hold gold
through most of the second half of the 20th Century (and exercise in
futility) and the relentless struggle against gold in the mainstream press
and through the nation's stock brokerage firms who obviously have their own
reasons for keeping people away from gold..
This state of affairs makes it nearly impossible to profit from short
instruments like futures' contracts, options and gold loans played from the
long side. As an owner of the physical metal, instead of pressing you as an
enemy, time becomes your ally. There will come a time when gold will win the
war against fiat money and rise for a protracted period. That will come, as
it did in the 1970s, as a revolutionary event involving a devaluation of the
dollar (whether that be formal or informal is another subject) Even then,
gold will not be viewed by most of its owners and advocates as a successful
investment, but more as a defense against the system which ultimately
destroyed the value of the currency. The seeds for such an event have already
been planted, otherwise those opposed to gold would not find it necessary to
attempt controlling its price. After all, controls to keep it in place imply
that its proclivity is to go up.
Consider this little essay on a quiet Wednesday in mid April as a summation
of gold's true fundamentals without numbers -- a bit of bed-rock philosophy
to act as a guiding light. The problem with socialist manipulations of the
currency and markets are that they rely heavily on human intuition and
intelligence and as a result prone to, no, destined for, error. That is why
the natural philosophers of the 18th Century who gave us our Constitution and
free market economy believed in things like the natural rights of man (life,
liberty and the pursuit of happiness), a natural economy (subject to cycles
and the profit motive -- the invisible hand), and a life in sync with the
rhythms of nature (hence the term natural philosopher -- Locke, Smith,
Jefferson, Franklin et al). Gold is more closely allied with that view of
life than the socialists view of control from the center and re-apportionment
of wealth through its auspices. And that's why those who advance big
government hate gold and those who advance gold hate big government.
In short, own gold as a reasonable percentage of your assets, sit back and
watch the show.
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 here on link above and make the appropriate entries.
Yesterday the Microsoft stock price fell through the 85 strike and this morning it has fallen through the 80 strike. How long before all those puts Microsoft has written come back to haunt???
Continued rationalisation was essential for the gold industry to compete for investor funds in global markets, the Australian Gold Conference was told yesterday.
The head of one of the world's top five goldmining companies, Mr Ron Cambre of Newmont Mining, admitted yesterday that "gold is simply not relevant to most investors" in today's technology-driven equities market.
He said the four biggest North American gold companies had a combined market capitalisation of 0.14 per cent of the S&P 500 index.
"The capital markets are telling us that size matters," Mr Cambre said. "North American gold funds today hold only $US2 billion [$3.3 billion] in assets as investors have withdrawn funds to invest elsewhere.
"Future investors in gold shares must come from the generalists who judge us not against our relative performance within the industry, but against the outlook for all investments, including the dot.com world that few of us understand.
"Considering that the Fidelity Magellan Fund and Vanguard's Equity Index Fund are each managing $US100 billion in assets, the threshold size for consideration by many portfolio managers today is a market cap of $US5 billion to $US10 billion."
Mr Cambre said the market capitalisation of the global gold industry was less than $US40 billion, and only nine companies had a market capitalisation of more than $US1 billion.
He said companies should also give thought to the re-emergence of the major mining houses of the past, and there was good logic to consider "multi-metallic" investments in the future.
Mr Cambre said that despite hedging, no major North American producer had been consistently profitable in the past 10 years.
"Looking only at earnings from operations, the average return on shareholders' equity for the top producers declined from 13 per cent in 1987 to zero last year. The average return for S&P industrials is above 20 per cent," he said.
"Generating adequate shareholder returns must be the industry's number one challenge in the years ahead.
"We must stop believing that because we are gold producers we can ignore the cost of capital.
"Projects that do not have a high probability of returning solid double-digit returns at today's gold price cannot be justified."
Mr Cambre's views on rationalisation were echoed by Delta Gold managing director Terry Burgess.
"For the industry to survive in the lowering grade and lowering margin environment there will be an ever-increasing push for mergers and acquisitions to take place between companies," Mr Burgess said.
"Adding value must be the reason for this as growth for growth's sake can only provide a short-term warmth followed by a hollow feeling - not unlike the feeling that Internet stock investors will experience when they realise that revenue without profit is not a driver."
Mr Burgess said the outlook for the Australian gold industry was robust even in the face of the low gold price.
"Hedging will still provide the confidence and price outcomes that will allow projects to go forward, although vigilant treasury management and controls will be of paramount importance," he said.
"The reduction in exploration expenditure will not materially impact the output of Australian gold mining industry for another three years or so, due to long lead times between discovery and first production.
"However, like a hand water pump, once the water flow stops, it will take an appreciable period of pumping, with no apparent results, before the water starts flowing again."
I really appreciate the time you took to answer my question about inflation so thoroughly. We are all very fortunate at this Forum to have such excellent truthful knowledge available to us. Where else could we getit? THANK YOU!
It occurs to me reading the excellant postings of the last 12 hrs on Japanese Economics, US Economics, Euro economics and finally International economics,that we are by engaging in international commerce, in effect entering into a competition for who uses our currency and for what. In such a competitive environment we offer up future taxpayer revenue in the form of ever higher Bond interest rates in exchange for it having bragging rights on the streets of the world for being THE currency to hold to defend your own from financial assault. Paradoxically we also have the largest trade deficit in the world. We (US) are also the worlds largest debtor nation. Our largest export? Our own indebtedness and inflation.
The Japanese are seemingly caught in an opposite, but nonetheless dangerous engagement of being a very large international creditor perhaps the worlds largest and has paradoxically a very large trade surplus. Could they be exporting their own deflation?
I can see that in the final balance, the US is paying the international markets to use the dollar for settlements.
This is not unlike the Japanese reducing the borrowing rates for the Yen to sub-riduculous levels of 0.5%. Perhaps I am just a dumb hick from PA but it looks to me like we are in the same game. Japan will have to match our effective rate of losses in order to stimulate their domestic economy. By that I mean negative interest rates. They will have to pay someone to take and use their Yen just as we are paying for the Markets to use our dollars.
Are we not in effect paying negative interest rates to foreigners to use our currency? Why don't we just cut through all this bogus BS a call a spade a spade. If the US were to just say to h*ll with all you spread and derivative traders we're going real-time and up-front with our dealings and just pay people directly to use our currency. What would happen? The game would be over sooner that's for sure. The Euro which afterall was developed to fill the void would suddenly find itself pulled into the big poker bluff game with insufficient preparation to meet the calls and would have to fold.
Isn't that what has really been happening for the last 10 years? A big bluff. Everyone playing the game knows deep down inside the back rooms that there can be no substance behind borrowings of taxpayer goodwill that far into the future and that far into the hole. G10 was assembled on an emergency basis to defer the inevitable great reckoning?
The big boys have gold to play with when nobody wants to play with bullsh*t chips anymore. Somebody or everybody has been sliding extra chips into the game from their chip factories without putting up the gold to buy them from the "official" chip banker. Worse, there seems to be a big argument going on as to which player was supposed to be or is the chip banker who is holding everyones real cash. Here's a dumb question. Just where is all the real money?
House proposes allowing Fed to eliminate reserves entirely
http://www.house.gov/banking/32900lea.htmBuried within amendments to H.R. 4067, "The Business Checking Modernization Act", ostensibly for the purpose of allowing banks to pay interest on demand (reserve) deposits, Congress grants Federal Reserve the option of removing reserve requirements.
http://www.house.gov/banking/32900lea.htm
especially see final paragraph:
"The Federal Reserve Act requires banks to hold 3% in reserves against the first $ 25 million the bank has in transactions accounts and between 8% and 14% against the amount above that threshold as determined by the Fed.. Today, the $25 million threshold level has been adjusted for inflation to $44.3 million and the ratio on the amount above that threshold level is 10%. The amendment eliminates the minimum statutory ratios of 3% and 8% for reserves LEAVING THE FEDERAL RESERVE WITH THE ABILITY TO NOT REQUIRE RESERVES (emphasis mine). The Federal Reserve Act specifically provides that reserves are to maintained solely for the purpose of implementing monetary policy."
So much for monetary policy -- expansion only from here on out???
Pay no attention to that man behind the curtain! For I am waxed not only the Great and Powerful Oz of the dominion elevated above and beyond the rainbows above Kansas (where good dreams get out of hand quickly), but now claim to be Oz supreme over the rainbows of all lands.
Apologies to the author of "The Wonderful Wizard of Oz" which was, as I understand it, itself a parody on the financial shenanigans of the day in the US.
I think I woke up too early. I'm back in Kansas and the cyclone is still approaching...there will be no happy ending this time. I'm headed for the storm cellar with what real money I can scrape up.
But the sun will rise again on a new day following the storm, overlooking the vast destruction and someone will say. Well, it looks like there's some work to be done around here.
And the cycle will begin anew. Those with the good sense to have built a storm cellar and the good sense to hide in it and not chase "Toto", will come out and start cleaning up the mess.
As I posted some time ago, in order for a gold bull to develop, it is imperative that "They" (the market gurus of the current NASDAQ and DOW bull) be invalidated.
That is now occurring.
"They" said the NASDAQ drop was only a correction.
In fact, it is now officially a bear market.
"They" said that the flight to quality would be into DOW stocks.
In fact, the normal pattern is for the extremely overvalued DOW to deteriorate at the end of the day along with the super-overvalued NASDAQ.
"They" said gold would plummet in advance of the Swiss gold sales.
But gold appears to be steady, forming a solid base, and has already priced the Swiss gold sales into the current price.
That is how market psychology changes. The gurus must be invalidated, replaced by new masters of the Universe.
It is a very slow process yet appears to be happening.
According to todays newspaper, the SNB will start
selling Gold at the beginning of May.They will then also announce the details.
The time to raise the signatures for the referendum ends at 20.April, the legislation will be set into force by the governement probably per 1.May.It will also allow the SNB to revalue our Gold.
Some interesting NUMBERS are also published:
� For 1999 there are 2274,5 t of bars and coins in the books with a value of 10,5 billion sFr.,but the actual value is 34 billions.
� ADDITIONALLY, there is 315,7 t of leased Gold with a book value of 1,5 billions (actual 4,7 billions).(I thought leasing was limited to 160t?).
� Gives the known number of 2590,2 t.
� 1300t will not be used anymore for currency and monetarian policy.
� the SNB has to use their quote (WA) for 2000.?!Has anyone figured out how much is left of the 400t?
As you know, the swiss Gold is the largest part of the sales in the WA.So there is a special focus on how the SNB will proceed.June Gold per Don_L. wont be an up month 100% sure,judging by history,but has a ceiling of 400.(?).IT LOOKS LIKE A BIG SURPRISE IS INEVITABLE.
Switzerland is a neutral country, so anything indicating a reduced support for the $ would be a major developement.(We might have been neutral but were always "leaning" to the right side).We'll see...
The rout continues to centre on "new economy" tech shares, with much of the money fleeing such sectors being put into old favourites on the Dow Jones index
"The good news is that there seems to be a rotation out of technology into the more traditional 'old economy' sectors. The money is not necessarily flowing out of the equities market," said Peter Coolidge, senior equity trader at Brean Murray.
I am still coming to grips with the idea of fiat reserves for fractional reserve banking.
NO RESERVE BANKING!
This is the biggest thing since the Federal Reserve Act.
I will research this and then DEMAND explanations from my congressmen on their positions.
I suggest everyone do the same!
The Week in Gold has been updated...market commentary courtesy of the World Gold Council
http://www.usagold.com/wgc.htmlHere is a sample:
(April 3, - April 7, 2000)
"The week opened with the National Bank of Austria's announcement that it had sold 30 tonnes of gold during 1999 as part of the Washington Agreement on Gold, and that it intended to sell another 60 tonnes by September 2004. These sales, which had been made quietly on a forward basis through the Bank for International Settlements, were accepted by the market as within the Agreement's limits, and the news had only a slight impact on prices."
"The Swiss National Bank announced that it had 328 tonnes of gold out on loan at the time of the Washington Agreement on Gold last September, when it and 14 other central banks agreed to impose a five-year moratorium on new gold lending. The total represented a sizeable 75% increase over the 187 tonnes on loan at the end of 1998. The SNB also reported that it received an annual yield of 1.6% on its gold lending in 1999, and that the average length of time to maturity of gold loan agreements was 7.25 months. Interestingly, the SNB also said that in the middle of 1999 it began conducting operations in which counterparties put up securities as collateral in order to reduce the credit risk on gold lending. By the end of 1999, 23% of all the SNB's gold loans were backed by such an arrangement."
"The IMF announced that it had completed off-market transactions revaluing 12.944 million ounces of gold as part of its share of funding for debt relief. These transactions, which involved the IMF selling gold to member countries and immediately accepting it back in payment for the obligations of those countries to the Fund, took place in the period from December 14 to April 5, and had no impact on the gold market."
http://www.usagold.comThankyou very much for the lesson on backwardation. I first thought that "contango" was the dance the traders did in the office when they finally made alot of money on their futures options. If it could be then we all might be doing the contango after this next short covering panic.
So I guess as we approach this inflection point where we are midway between contango and backwardation we get evenness in the prices between now and out in the future. Very, very cool. Thankyou THC.
Third world per capita incomes rise slowly. Nearly every household with or without electricity, has the financial resources to buy and use a 35mm camera. Photography buffs are happy with their adjustment features on their Minoltas. They are in control with all the settings adjustments. So these deluxe 35mm cameras are not going to be displaced anytime soon. Digital cameras are only useful if the user has a quality PC. A quality PC is far beyond the economic resources of the average third-worldian. Now the ones who do own a quality PC, what type of printer do they own? ONLY a 1440 dpi quality printer can reproduce a digital photo with near resemblance to the 35mm film quality. Great, so we finally have the folks who have both the digital camera, the high quality PC, the high quality 1440 dpi printer, and the picture still looks like blurred newsprint because they refused to buy the super-expensive high-gloss paper. I'm talking about "photo-functional weedout". The people skip one important step and there the camera sits, unable to compete with the $6 throwaway 35mm camera from Kodak. Most people cannot program a VCR. AOL's success relies solely on the basis of configuration fears. People are still computer tech illiterate. I didn't say they couldn't read. I said they fear software configuration having skipped past DOS and basic computer understandings. I'm saying the silver nitrates used in photo processing turns silver into a disposable strategic metal. Photos thrown in shoeboxes are one step closer to the landfill. One of the first items purchased by a low per dapita worker is a camera. Silver usage is not going down because of the digital camera. Digital cameras are in the fad stage. They will find a niche market within highly tech literate countries eventually. But simplicity is quickly becoming a virtue when it comes to computer crap. Amipro running in DOS with high ram is still faster than the latest in 98, and did you ever relearn all the features you used to use? So the disposable camera wins. Warren Buffet wouldn't be in silver if this wasn't true. They only people who fear digital camera usage are the people who have to explain for hours to techy illiterates how to use them. Those manuals written by mainland Chinese really take the prize too. Wanderful prepositions and scattered verb placement........your camera new........enjoy!!!
Oro RE: 4-11 # 28478 Middle Class Welfare and The Phase-Lock-Loop
Sir Oro- Really enjoyed yesterdays remarks on Da Boyz. You stated something that I've been increasingly aware (wary) of regarding who foots the bill when the scamsters start a joint effort PPT move to counter market gravity. Somebody is buying on the cheap and someone is buying on the high, setting the whole cycle to renew again the next day, (or mini-crash day, which seems almost daily)
So, Uncle Friendly backends Da Boyz at our (those of us not in Wall Street pinstripes) expense, in an ongoing bilking of funds from the poor little players who think the sun sets on CNBC.
So the loop continues with Uncle getting his tax incentives, while the Company Team covers all bases with ESOP's fable.
Yup, looks like middle class welfare to me- maybe not so middle class?
Thanks a tonne again, for your energy and consideration.
Sir beesting- Was hoping other sources might come in to tell of the landscape in Japan at the physical demand level. I'm afraid my last trip was of a sightseeing relaxing nature away from the cities, so the only gold I can report back on was on the temple ceilings too.
Good points were raised about most items for sale in Japan, are mostly cheaper outside the country.
Perhaps when the yen makes big moves against the dollar (can't buy it down forever) we'll start to hear about gold over there. Is not inflation supposed to be good for gold? Or is that my over 40 backwardizational thinking? New paradigm for me is still four nickels.
NEW YORK (Reuters) - Technology stocks bounced off their lows in early afternoon trading on Wednesday but still languished deeply in the red as investors shifted more money out of tech heavyweights and computer-chip shares.
U.S. blue chips rallied on the back of strong corporate earnings that boosted top bank and paper names.
``This is just the way the momentum is now. Everyday seems to be the same with weakness in the Nasdaq,'' said one Wall Street trader. ``I don't think there is general panic out there but people are raising their eyebrows, no doubt.''
By early afternoon, the Nasdaq composite index (^IXIC - news) was down 3.76 percent, or 152 points, at 3,903 after dropping more than 4 percent in earlier trading. The gauge fell to 3,850 twice on Wednesday but bounced back, leading some market watchers to think the mark may be a support level.
http://www.theonion.com/onion3613/wdyt_3613.html"So people finally figured out that all that money in Internet stocks is largely imaginary, and that sent the market plummeting? Gee, better not tell them about banks."
Linda Irving, Research Assistant
The International Monetary Fund said that Saudi Arabia, Kuwait and other Middle East oil exporters would earn an extra $30 billion (representing half of the worldwide exporters' total) this year based upon IMF projections of average world oil prices at $24.50 a barrel in 2000 versus $18.25 a barrel last year.
Though the U.S. government has revised their own projection downward last week to $23.50 per barrel, when the Energy Department last month projected an average price of $26.62 for the year, the payday for OPEC nations would have approached $211 billion, up from $133 billion last year.
Now it's time for the sheep to move..After months of money quietly moving out of markets, the rush is starting. Comments by pundits on CNBC talking 50%
cash in accounts...my, my. How many will and how many will 'NOT' wait til the end days before the Clinton Economic Dream Team (PPT) and the misuse of the ESF come to an abrupt end??............................Now I must wonder aloud how long before the quiet accumulation of Physical Gold becomes as apparent as the flow of cash from stocks. The future of Gold seems nearer rather than farther to my eyes.
Dow...6000......Nasdaq...2000.....Gold.....$850.00.....This is my vision of the year ahead.........FWIW....YGM.
Banking reserves...Sirs Econoclast and John Doe's discussion
H.R. 4067, "The Business Checking Modernization Act"
"The Federal Reserve Act requires banks to hold 3% in reserves against the first $ 25 million the bank has in transactions accounts and between 8% and 14% against the amount above that threshold as determined by the Fed.. Today, the $25 million threshold level has been adjusted for inflation to $44.3 million and the ratio on the amount above that threshold level is 10%. The amendment eliminates the minimum statutory ratios of 3% and 8% for reserves LEAVING THE FEDERAL RESERVE WITH THE ABILITY TO NOT REQUIRE RESERVES [John Doe's emphasis]. The Federal Reserve Act specifically provides that reserves are to maintained solely for the purpose of implementing monetary policy."
You see, gentlemen, this really gets to the heart of our almost daily reports of the Fed's open market operations to add reserves to the banking system.
To put this legislation in better perspective, there is currently no reserve requirement whatsoever on savings deposits, whereas you can see from the above that the reserve requirement on transaction (checking) deposits is rather small. This could put them in the same boat, leaving to the discretion of the individual banks the amount of vault cash and similar reserves kept on hand.
Truely, even now, as Econoclast observes, there are only fiat reserves for the fractional reserve banking system...a house of cards upon a puff of air as a foundation.
This House bill was likely put forward with the support of the national banks who rail against the interest they must pay whenever they have to borrow funds to maintain their reserve requirements. And with depostors drawing down their accounts (which drains away the banks' on-hand reserves) faster than loans repayments replenish the reserves, they all turn to the Fed to borrow the needed reserves against various collateral.
Today, for example, the banking system turned to the Fed for a $5.25 billion addition to their reserves through an operation of overnight system repurchase agreements.
All gold mines in the world produce annually about 2,600 tons of gold with a total value of close to US $30 billion. Since Bill Gates owns about $100 billion worth of Microsoft shares, he could buy more than 3 years of annual gold production and still keep some change.
Should he consider a switch? Late last year I recommended purchasing some gold as the ultimate contrarian play (see FORBES GLOBAL, Nov. 16, 1998). For most of 1999, selling by central banks depressed gold's price. But recently gold has shot up by more than 20% from its low, to around $320 per ounce in one of financial history's most remarkable short squeezes, as European central banks decided to refrain from selling their gold.
Question: Is this the beginning of a new bull market for gold?
All the gold in the world that is above the ground--in the form of coins, jewelry and central banks' ingots--amounts to about 120,000 tons, valued at present at US $1.3 trillion. Compare this to the market values of the largest six U.S. technology companies--Microsoft, Intel, IBM, Cisco, Lucent and Dell--which total $1.6 trillion (up twelvefold from $133 billion in 1995). Meanwhile, the global bond market's market value is $30 trillion. These comparisons suggest there is relatively little gold around. Its annual supply, at $30 billion, is also tiny when compared to the annual supply of bonds in the world, at about $3 trillion.
Consider: If everyone in the world bought one gram of gold per year (current price: $11), annual demand would amount to 6,000 tons, or 2.5 times the annual supply. Impossible? But last year India, with a population of 1 billion and GDP per capita of just $300, bought over 800 tons of gold, almost 1 gram per person.
If investors' psychology changed and gold was once again regarded as a store of value, as in the 1970s, when its price shot up to $850, then demand would be twice as large as all the gold available outside the central banking system.
"You got it all wrong, Marc," some will say. "How can you compare gold, which does not generate any income, to equities which have underlying eamings with a rising trend, or to bonds which generate income?" This argument is valid, but with two provisos.
If companies generate earnings in excess of the rate of inflation and are reasonably valued, then it is likely that they will provide over time a higher return than gold. However, if they have no earnings, are excessively valued or savaged by inflation, losses, expropriation or taxation, then gold may provide an attractive alternative. Thus, I would rather own, now, close to half the world's available gold than all the world's Internet companies, which are valued at about $500 billion and which continue to lose more and more money.
Similarly, bonds are only attractive as long as they provide a real rate of return, do not default, and--most important--are denominated in a sound currency. But are these conditions in place today? The $30 trillion global bond market is growing by about 10% per year; it doubles every 7 years or so in size and will reach, at this rate, $1,000 trillion in less than 40 years. Yet the global economy expands by just about 3% per year. This uncontrolled credit expansion will, in my opinion, lead either to far higher inflation rates or to massive defaults sometime in the future. In either case, gold will provide the only sound currency.
I may add that when a market gives a strong signal by breaking out on the upside after an extended bear market, it is usually not immediately obvious why such a move occurred. In the case of gold we shall only know much later why gold has begun to rise. Still, the coincidence of the upturn in gold with the downturn in U.S. equities and the U.S. dollar is worth thinking about.
What about gold's downside risks? After its recent surge from around $252 to over $320, gold may run into some profit taking. However, since the outstanding short position still exceeds over 4,000 tons and may be as high as 8,000, I very much doubt that we will again see gold fall below $280. The downside risk is, therefore, about 10%, compared to huge upside potential if the annual physical demand is supplemented by a change in investor psychology and by central banks' buying the metal to diversify their monetary reserves.
So go for it, Bill Gates. By trading your Microsoft stock for more than two years of annual gold supplies, you could bleed the shorts and drive gold to $1,000.
Marc Faber is managing director of Marc Faber Ltd. and publisher of the Gloom Boom & Doom Report. e-mail: contrary@hk.super.net
US Markets tumble in view of EU's stumble over the Austrian Issue!
A strange day - normality seemed to be the message on the markets. Dow profiting from the "shift" to quality, while NASDAQ extending its overdue correction. As real assets, gold and its mining shares stagnating - until even the "old economy" quality stocks got hit in the final trading hour. Abnormally, either the PPT has been employing all forces on straightening the ever inversing yield curve, keeping a lid on gold, the Yen and ohter fractures on the debt bubble dike, or else are starting to lose control? Whatever the outcome - in the end, lose they will, and Wall Street will crumble, when the tidal wave of debt, derivative and monetary excesses will flood lower Manhattan and the rest of the worlds financial underground!
Meanwhile, the Perth Gold Conference put a tawdry price tag of 40 bn. $ on the remaining producers of the metal, a sum equivalent to the first day gain of a DOT.COM IPO. I'm embarrassed, not so much being still a gold bug, but of the utter stupidity of the mainstream media, hustling their masters voice in view of the clearly visible end game of this debt bubble ponzi scheme.
I'm also embarrassed by the Austrian National Bank to join the $/IMF Anti Gold Puppeteers at this late stage of moral (holocaust? - see Swiss gold sales) blackmail.
And to add insult to injury the Austrian President's speech at the EU Parliamant was, utterly uncalled for, officialy commented by Nicole Fontaine in form of an infantile, (un)diplomatic affront. Just another brick hurled
at the builders of a combined economy, currency and political union, at a time when the 14 (plus one) set their goals at becoming 28!
This paria is buying more freedom -with more gold.
An utterly embarrassed CB2
If you look deep into Stillwater Mining's financials, you'll find a paragraph outlining contracts for delivery directly to GM,Mitsubishi, and others. At a fixed price too! They won't be squirming just yet.
If, as someone suggested, the fed did shift their attention to shorter term maturities in order to help repair the inverted yield curve, they haven't succeeded yet. Mr. Hill Billy's temperature inversion numbers are still just that- inverted. It's my understanding that the longer this condition exists, the sicker is the patient and the harder it is to cure. Those who judge markets by charts and various indicators (like the yield curve) must be coming to the realization that there is a change in the wind. Perhaps soon we'll see just how this generation that has never experienced bad times reacts. Many still don't recognise what they are looking at because they've never seen one and for some, as my dad used to say, Hope dies hard.
http://www.usagold.comA day I shall never forget. Reports from the money crowd early indicated that borrowers would have to pay whatever the lenders saw fit to ask. There wouldn't be enough to go around. Thay day the money crowd was much larger than usual. When delivery time came that afternoon there must have been a hundred brokers around the Money Post, each hoping to borrow the money that his firm urgently needed. Without money they must sell what stocks they were carrying on margin---sell at any price they could get in the market where buyers were as scarce as money- and just then there was not a dollar in sight.
My friend's partner was as bearish as I was. The firm therefore did not have to borrow, but my friend, the broker I told you about, fresh from seeing the haggard faces around the Money Post, came to me. He knew I was heavily short of the entire market.
He said,"Larry! I don't know what's going to happen. I never saw anything like it. It can't go on. Soimething has got to give. It looks to me as if everybody is busted right now. You can't sell stocks, and there is absolutely no money in there."
"How do you mean?"I asked. But what he answered was, "Did you ever hear of the classroom experiment of the mouse in a glass-bell when they begin to pump the air out of the bell? You can see the poor mouse breathe faster and faster, it's sides heaving like overworked bellows, trying to get enough oxygen out of the decreasing supply in the bell. You watch it suffocate till its eyes almost pop out of their sockets, gasping, dying. Well, that is what I think of when I see the crowd at the Money Post! No money anywhere, and you can't liquidate stocks because there is nobody to buy them. The whole street is broke at this very moment, if you ask me!
It made me think. I had seen a smash coming, but not, I admit, the worst panic in our history. It might not be profitable to anybody-if it went much further.
Finally it became plain that there was no use in waiting at the Post for money. There wasn't going to be any. Then hell broke loose.
The president of the Stock Exchange, Mr. R.H Thomas, so I heard later in the day, knowing that every house in the Street was headed for disaster, went out in search of succour. He called on James Stillman, president of the National City Bank, the richest bank in the United States. Its boast was that it never loaned money at a higher rate than 6 percent.
Stillman heard what the president of the NYSE had to say. Then he said,"Mr. Thomas, we'll have to go and see Mr. Morgan about this."
The two men, hoping to stave off the most disasterous panic in our financial history, went together to the office of J.P. Morgan & Co. and saw Mr. Morgan. Mr. Thomas laid the case before him. The moment he got through speaking Mr. Morgan said, "Go back to the Exchange and tell them that there will be money for them."
"Where?"
"At the banks!"
So strong was the faith of all men in Mr. Morgan in those critical times that Thomas didn't wait for further details but rushed back to the floor of the Exchange to announce the reprieve to his death-sentenced fellow members.
In the daed silence that followed, Mr Atterbury said, "I am authorized to lend ten million dollars. Take it easy! There will be enough for everybody!" Then he began. Instead of giving to each borrower the name of the lender he simply jotted down the name of the borrower and the amount of the loan and told the borrower, "You will be told where your money is." He meant the name of the bank from which the borrower would get the money later. I heard a day or two later that Mr. Morgan simply sent word to the frightened bankers of New York that they must provide the money the Stock Exchange needed.
"But we haven't got any. We're loaned up to the hilt'" the banks protested. "You've got your reserves," snapped J.P.
"But we're already below the legal limit," they howled. "Use them! That's what reserves are for!" And the banks obeyed and invaded the reserves to the extent of about 20 million dollars. It saved the stock market. The bank panic didn't come until the following week. He was a man, J.P. Morgan was. They don't come much bigger. That was the day I remember most vividly of all the days of my life as a stock operator. It was a day when my winnings exceeded one million dollars. pages 113-115 "Reminiscences of a Stock Operator" by Edwin Lefevre..........about the panic of October 24,1907
Deja's View on what is going on with bank reserve requirements this week.
===========================================================
"Well it just has to bounce off of 3600....."
Is fear a stronger emotion than greed? yes it is. Things go back up because the bull trend is intact. Is the bull trend still intact........P/E ratios around 250?......that is like asking if the parachutist is well qualified while his lines are twisted and he is falling out of the sky.
Look up the Djia 10 year chart. Draw a line from 1990 to the top of 1995. See how much extra ice cream you got for free? All that extra nobody paid for, it's all coming off if it's a true bear slide. Now let's look at the 10 yr gold chart, see the giant cavity? Somebody needs to put boss Keenes dirt back into boss Hogs hole, Luke? Well what we have here is a failya to communicate. When a man's rally dies, he gets panic in his blood and he wants to run. Keep shaking that tree Luke we know you're pissed off."
Nasdaq-uwa Takaideshoka? Hai takaides. So very high des. Like the woman lifting weights in the Schwab commercial says,"29, Now that was a market correction"......so Schwabby wants his people to ride it down like the cult leader with the financial koolaid. "Just lay down now and it will all be over soon. Let us sell your stock short while you die painlessly. Then after you wake up and loose your retirement, we will gladly return your stock after covering our positions at the bottom." "Ready to invest again, what you're broke, well never fear we loan out lots of margin here." Another great day if you are in gold......
http://www.spotlight.org/04_10_00/Libletter/libletter.html"On February 24 [Senator Jack Reed] quietly introduced the so-called 'handgun Safety and Registration Act of 2000.' The bill is numbered S. 2099. It has been referred to the Senate committee on Finance. The bill would 'amend the Internal Revenue Code of 1986 to require the registration of handguns and for other purposes.'
Among other things, S. 2099 would do the following:
- Impose a new federal 'transfer tax' on handgun sales;
- Impose new federal taxes on firearms manufacturers; and
- Require all now-unregistered handguns to be registered immediately.
The proposal is part and parcel of a UN plan to register every firearm possessed by every human being on the planet!"
---------
Read and weep.
Leonard Kaplan (LFG Bullion) Talking Down Gold Again
Today over at the "other forum," he is saying that based on today's action gold cannot possibly perform well during a market crash. Furthermore, he continues to shout that a market crash will not be good for gold (strange assertion given that an equities bull market has practically destroyed gold)
He warns about gold's prospects based upon today's action? He must have forgotten "Turnaround Tuesday" where gold popped up $10 within an hour during the height of the panic.
He also forgets that gold needs a series of simultaneous developments to move up strongly: a FALLING US Dollar (did not happen today) PLUS a FALLING DOW, a FALLING NASDAQ, and FALLING BONDS. Today one component to the equation was sorely missing. But when all components are diving, there we will be no other safety haven available except precious metals.
I don't blame the man for maintaining his spin. After all he's been one of the leading cheerleaders for momentum investing in the Nasdaq. He has urged gold investors for some time now to join in the mania of buying total absurdity, like internet companies with no business plans and no hopes for profits. Well, I can imagine how badly he must be bleeding now....
Of course, lest we think he is radically different than us, he does claim to be a "gold bull" forecasting (maybe) gold to 310 or 320 by Fall???
That's not bullish however, that's indifferent.
In a way I feel sorry for the man. It must be unpleasant to work in an environment in which one has so much "contempt" for the product (precious metals). He would be happier as an MM on the Nasdaq or something of that nature where he can work amongst fellow admirers of the current stock market bubble.
No man knows the full ramifications,that the unraveling of complicated financial mainsprings,will wreak upon us.
If in the worst case there is ultimetely a full systemic breakdown,we will have years and years of a siege mentality to look forward too.
That we are living under a Regime, and that includes all 3 branches of Federal Government, that is already close to giving up all pretense of operating within the established confines of the Constitution and Bill Of Rights, goes without saying.
In order for the TREASONS to be so widely embraced and accepted by the ruling political class we have only to know and accept that they are criminals engaged in an ongoing ORGANIZED CRIME.
What Liegh has brought to our attention concerning gun registration,within Internal Revenue Code, no less, will seem as benign as seat belt laws before this is over with.
The insiders know so we should watch what they do.
http://www.usagold.comMaybe I went too far with what my message might imply. We can only surmise if this is the big 29-like break by looking around the edges at all the factors surrounding the markets. The stock market blow off is not what causes the collapse, it's the compounding elements that the sudden implosion of valuations creates. Loans for cars and homes based on equity holdings that fell by half. It precedes a liquidity crisis that requires instant cash injections into the economy.
If a government could solve all its problems by printing money then it would. The problem with the "just print it" solution is that alot has been already printed and the float will return real fast if they just print more. If the Emperors want to please the masses then they ruin the ultra-rich. If they serve the ultra-rich by refusing to print in the face of a liquidity crunch then they strangle the masses. Thus the rich find safety in strong dollars, interest rates remain moderate, businesses go broke as no one has money to spend due to debt service, and homes get sold at auctions and young couples move back in with mom and dad. Deflationary recession/depression. Gold would still go up because of the massive short position unwinding.
Look at the tide of American socialism and the "equalities of outcome" social engineering emphasis. Democrates in power think the middle class is fit to pillage. The Republicans never seem to obey their conscience when it comes to voting. The party is weak, very weak. They have alienated most of middle America with all their kissing up to the Pharisee sin pickers slinging mud at anyone who sinned one time. Zero compassion for the poor, no tort reform (justice), lip services, and same rejection of discipline as the Democrates. NO PLATFORM either. Why? Because they have money in their eyes instead of a vision of what this nation is supposed to be about. Corporations want Bush. But Land grab Al could be the next president and the capital flight and expatriot awareness I think will put gold on everyone's map.
Free love, drugs for all, and the Sodom circus....that is the part of this country that elected Mr.Bill, 40%. Step on my toe and I'll sue you. Litigation freaks.
Hard money fiscal goldbug conservatives represent no more than 25% of the population. So when it comes to bread and the circus, that means the hyperinflationary solution to please the masses. The rich can fly away and they do. They can leave the big island of Dr. Moro. Biotech........its for planting chips in people to track them. "We know where you are and we don't have all your money yet, Thankyou, be sure to log on tomarrow at the same time." They have chip transmitters in pets all over this country. They track polar bears from satellites. No, its Dr. Frankenstein (the clone nut) and Dr. Moro (the genetic mutation designer) and Assoctates. Symbol BINX,what's the product??? I'm gonna scare you onto that yacht you bought, MK can help you store your pocket change.
With great pleasure I read your post of a Lady who is obviously aware of where all freedoms stem. Hopefully all gold-bugs share your concern.
If I could be so bold as to recommend a great read. "Armed and Female", by Paxton Quigley. Good for all mom's, daughter's, and the boy's in the family too.
Following up on $5's previous post. Based on a recomendation by George Ure at the Urban Survival web site, I found a copy of Joseph A. Tainter's "The Collapse of Complex Societies"
What an excellent read. After examining a series of theories on why various civilizations collapsed, based on climactic changes, invasions by barabarians, etc. he comes up with a theory of complexity and the decline of marginal returns. He applies the analysis to the Roman Empire, the Mayas, and the inhabitants of Chaco canyon.
The marginal returns, in the case of the Roman Empire, which initially supported imperial expansion, were due to the increased tax revenue accruing from the conquered poeple. for a while, this was self-sustaining, as conquests paid for themselves and returned extra dividends, engendering more conquests. However, the marginal returns began to decrease as further conquests were not possible due to the pesky effects of distance from the central commmand. An organization that for a few hundred years developed to sustain the military power of the empire was suddenly placed in the position of having to defend these conquests, while the marginal returns of defense were much less (and in fact negative). At the same time, large-scale social welfare programs (at one point most of Rome's population was on the dole) designed to enhance the legitimacy of the emperor constituted a major drain on the treasury. What had been a plus game turned into a negative game, and the emperors began to play with the currency, with almost constant devaluations so that a silver denarius only contained 67% of the silver as the original, tries at "fiat" copper currencies, etc. Finally, the army began to shrink, as it was not being paid, local rebellions ensued as higher and higher levels of taxations made the populations embrace "barbarian" liberators, and the rest, is, as we say, history.
The parallels with our modern US of A are more than a few. Here, we have a government that, by ever-increasing levels of taxation redistributes the taxes, and more, via deficit spending, back to the populace as a way of maintaining legitimacy. Debt-ridden budgets continue to expand, while an aggressive "police-the-world" foreign policy further depletes the treasury. The marginal returns on investment in the post-World War II era have all been spent down, and there is no prospect of investment which will return that which is required to maintain a balance of payments. Meanwhile, the currency continues to be debased at a rapid rate, via the legerdemain of Congress and its Social security derived surpluses, cash basis accounting rather than accrual basis accounting.....
It's real hard to maintain a positive attitude for the long term. But trust me, it's a great read....
"Ducks shouldn't fly so high,
that they run out of sky.
Slow and sure plods the cow
there before and still there now.
And lower down there is some gold,
or so I'm told."
I attach a page from a Book by Richard Maybery as it is in keeping with the current crop of posts. An aside; does anyone think that the slightly inverted yieldcurve is Greenspan's way of serving notice on the $30 Trillion in US financial derivatives? If he keeps it slightly negative he can put a sizable portion of the derivatives in the red. If he doesn't take it too far into inversion he could make it painful without making it deadly (maybe???) and force some unwinding. Just a thought.........
Justice"
by Richard J. Maybury. Chapter 30, page 159:
"When living in a government-controlled economy as we do today, you will be better able to manage your career and investments if you understand the nature and behavior of government. Obvious, right? If you try to make decisions based on fictions you'll be running much risk.
So, what is the real nature and behavior of government? Where did government come from?
Any child knows the answers, right? It's easy. The institution of government was invented long, long ago to help us. People needed certain essential services, especially law enforcement, so they got together, chose someone to be their government, and voluntarily agreed to pay taxes for the services the government would provide.
"This is the official story we are all taught. It sounds good except for two small problems. First, no historian has ever been able to find an example of this happening. In A THEORY OF THE ORIGIN OF THE STATE, anthropologist Robert L. Carneiro writes, "We now know that no such compact was ever subscribed to by human groups."(41) Sociologist Franze
Oppenheimer, writing in THE STATE, is more blunt. He calls this explanation "a fairy tale,"(42) and is distressed that it is "prevalent in university teaching.""
Carneiro and Oppenheimer explain, in a much more scholarly fashion than does Maybury the real reason government was invented. He briefly explains how the robbers and brigands stopped raiding the towns and communities and moved in and took permanent control. They set up this scheme called "government" and "taxes" and all the rest. He continues:
"Carneiro says this was the essential process for the invention of governments in "Mesopotamia, Egypt, India, China, Japan, Greece, Rome, northern Africa, Polynesia, Middle America, Peru, and Columbia, to name only the most prominent examples."(44) Oppenheimer adds Britain, France, Arabia, Italy, Germany, Spain, Mexico, and many others.(45) All governments today have evolved from these origins.
In other words, governments do not collect taxes to provide services, they provide services as an excuse to collect taxes. A tax is a substitute for a raid.
Thomas Paine asked, "From such beginnings of governments, what could be expected, but a continual system of war and extortion?"
Carneiro observes: "A close examination of history indicates that only a coercive theory can account for the rise of the state."(47)
The Romans had owned plantations called latifundia. A gang of barbarians would overrun a latifundium, force the workers into a kind of slavery called serfdom, and make these serfs build them a fort called a castle. The gang would set up housekeeping in the castle and live off the taxes they collected from the serfs.
This is royalty. We are led to believe kings and queens are like movie stars, glamorous and wealthy. Children are told stories in which the young heroine dreams of becoming a princess and marrying a handsome young prince.
Marrying a handsome young prince meant marrying a handsome young gangster, and, in some cases, a handsome young mass murderer. ... My experience has been that deep in their hearts most people sense there is something inherently wrong with government. Is there any country where the word politics is not pronounced with a sneer?" ... The world's early governments evolved into those we have today, and all have retained their essential natures. To get what they want they use force. The force is usually hidden but it's there and you will feel it if you resist.
I believe a major reason America and the world have gotten into so much trouble during the 20th century is that we have forgotten that, fundamentally, governments are predators. Attempts to make them do good are attempts to make the leopard change his spots. Maybe it can be done, but 6000 years of history are not encouraging.
41. A Theory of the Origin of the State by Robert L. Carneiro, Institute for Humane Studies, George Mason University, VA, P. 4.
42. The State by Franz Oppenheimer, Viking Press, Free Life Editions, New York, 1944, p. 5. 43. Ibid. p. 4. 44. Ibid. p. 6. 45. Ibid. p. 8. 46. Ibid. p. 6. 47. Ibid. p. 8.
I started the gold pledge due to interest from the silver pledge.
With the pledge you can only enter your pledge once.
A cookie stops you from multiple entries.
So with the encouragement of others I started the gold pledge so that people could also enter their pledge there.
I've added a comment into the gold pledge where it states that for initial pledgers their greatest effects will be with the silver pledge.
I don't see any damage with this if they follow along.
I've been cajoling the posters on Kitco to do their bit and forward the url to other websites so that they can support the pledge.
Here's a copy of a comment I made on Kitco:
I'm hoping that if enough people join in and the numbers get real enough that it will catch on like an email letter.
I'm not keen to spam it out into cyberspace, but feel that if enough individuals get involved then it will get there of it's own accord.
By getting it out of these few gold forums and onto the net it has the potential to garner enough interest that the tally of pledgers will start to create waves.
So far the polls up to approx 180 pledgers for a total of 74,000 ounces ( 0.36 million$ ) and it's not yet a week old.
This is yet not noteworthy but a good start.
I'm sure if we hit a million ounces then the media would pick up on it and then it would spread across the net like wildfire.
I'm hoping it'll get big enough that Drudge would run with it.
That'll set the sparks flying.
If it doesn't get promoted out into cyber space then it's doomed to die.
Just a bunch of goldbugs who a back-patting themselves about all the PM's they own.
It need the power of the people behind it.
----
The link needs to be sent to PM coin & bullion dealers, right & left political sites - patriot sites etc.
If we goldbugs don't get up and support ourselves then it's doomed for failure.
Thanx, Jinx, for the Mayberry piece. For all who found this piece intriguing, I recommend Lysander Spooner's NO TREASON: THE CONSTITUTION OF NO AUTHORITY. Written in 1870 by a Massachusetts lawyer, it is a very in-your-face repudiation of the so-called "social contract". It's a thoughtful and, some would say, subversive work. I believe I got my copy from Laissez-Faire Books in San Francisco many years ago.
Here's a taste. Don't get caught with this on your hard drives. I expect the NSA will flag this and be at my door shortly.
"Who, then, created these debts, in the name of "the United States"? Why, at most, only a few persons, calling themselves 'members of Congress,' etc., who pretended to represent 'the people of the United States,' but who represented only a secret band of robbers and murderers, who wanted money to carry on the robberies and murders in which they were engaged; and who intended to extort from the future people of the United States, by robbery and threats of murder (and real murder, if that should prove necessary), the means to pay these debts."
I would add that the above outrage was vented over the approximately $2.453 billion dollar debt of the day. Ah, the good old days.
Concerning yesterday's little blurb on SWC hedges.
Stillwater Mining has contracted sales of Pd and Pt to "certain clients" at a minimum set price with no limit to the upside. They receive a minimum price for their PGMs, but if the spot price is greater than the hedged price, then they receive the greater price. This resulted from some bad experiences with hedges in 1995 through 1997. The financial officer was eventually "allowed" to "persue other interests", and the hedges were restructured. The current hedge program provides downside protection while allowing for full upside exposure. This can be found in the Stillwater Mining Company report Also, the East Boulder expansion project is back on schedule. This will effectively triple reserves, and the refurbishing and expansion of the mill complex will greatly contribute to throughput of ore. Of course, the gold companies haven't been able to make such advantageous hedging deals. In fact some are absolutely stupid as seen with Ashanti, Cambior, and Emperor Mines.
Kaplan does not seem to remember history very well. During the last CRASH of the markets, though physical gold ownership was illegal, Homestake Mining served as a fair proxy. While most equitites were vaporized, and many lost 90% or more in dollar value, HM rose well over 260%. I don't know much of this individual, but there is great danger when major institutions and individuals hire former "Slurpee salesmen" from 7-11 for financial analyses :-)
"I seem to recall a figure from TC (?), that Japan's gold intake 4th qtr. last year increased 25% year on year. Do you, (if still in Japan), have a feel for how folks over there are reacting to their no interest inflationary environment? Gold aquisitions increasing by the average person?"
There may be ups and downs in Japan's gold demand, but unfortunately the average person in Japan is about as clueless as the average American when it comes to gold.....I would not hold my breath expecting them to buy significant amounts......until WAY AFTER the gold bull begins....just like in the US.
I hold more hope for the Chinese, who LOVE gold and silver, but know that prices in China are artificially high, and will not buy in volume now.......maybe after it is available at free market prices there.........
Sorry not to have good news.....
For now, I am enjoying the gasoline backwardation on the Tocom.....buy futures and wait 6 months......up 10%........free money.........
No matter which individual you may choose to attach the comment to--if the shoe fits. It's a classic!
------------------
"Of course, lest we think he is radically different than us, he does claim to be a "gold bull" forecasting (maybe) gold to 310 or 320 by Fall???
That's not bullish however, that's indifferent."
-------------------
It gave me a good smile as I sit here filling out tax forms--a task that's as unsavory as taking a paring knife to a Gold bar under the notion that elected officials in Washington can put my property to use more productively than I can. Sheeeeeeeesh! Gimme a break.
Just Something to Read With Your Morning Coffee....
E-mail evokes distant era
'Wooooohohooooo. This is FREE money!'
William Hanley
Financial Post; W
With the Nasdaq composite index closing yesterday almost exactly
where it started the new millennium after losing the 24% gain, it's
time for some strong coffee this morning to accompany toast buttered
only on one side and a few moments of reflection on the vagaries of
the market.
But first, let's warm up by harking back two or three weeks through
the mists of time to an era of full flowering in exuberance. John
Bollinger, the high-profile technical analyst who runs Bollinger Capital
Management Inc. in Manhattan Beach, Calif., recently received an
e-mail from one overexcited individual that pretty well speaks for the
kind of stuff that commentators, including Market Eye, often are sent
by pumped-up readers:
"What on earth are you talking about?
"Are you missing this party ?!?!!
"Forget history!!
"FEH! It's DIFFERENT this time!!
"I'm fully margined to the HILT. I've gone from 30k to over a million
in 18 months!!!
"I'm letting it RIDE baby!! How do you think I got here?!!?! Not by
holding bonds, THAT'S FOR SURE.
"Wooooohohooooo.
"This is FREE money!
"I wish I found the markets years ago.
"I quit my day job months ago!!
"I'll never work again as long as the markets keep FLYINGG!!!
"I'm gonna have five kids now that I've got an infinite source of free
money!
"Gotta go!
"Time to buy my second Porsche!
"Yip yip yeeeeeeeee haaaa!!!"
This is a splendid rendition of the call of the species homo daytradius.
And we just hope that a somewhat different cry will not be emanating
from a rustic trailer park habitat some time soon.
No, this is not a gloat. Market Eye knows better.
It is an acknowledgement that an era --or sub-era -- is over in the
stock market. The greatest bull market in history -- as measured by
the major indexes -- remains intact, despite stumbling this year. But
the speculative excesses surrounding technology generally and the
Internet specifically are being wrung out of the market in a process
that is putting many investors through the wringer.
It's easy to say that no one can possibly be surprised by the savage
bear market forming quickly in the techs or the swift lateral
arabesque into the cyclicals. But many traders, having bought the first
three Nasdaq/TSE technology stock dips and been further
emboldened by last Tuesday's great escape, have been caught offside
by the move, no matter how well telegraphed it seemed.
Those who caught a ride on the Nasdaq express when it was pulling
out of the station 18 months ago and who began disembarking in the
past few months will be feeling elated. Those who clambered aboard
in the past few months and were not disposed to take quick profits or
cut their losses after buying near the top will be feeling deflated, the
greater fools at the end of the line.
At breakfast tables everywhere this morning, people burned by a
combination of tech stocks too hot to handle and by their own
miscalculation are agonizing over whether they should take losses and
put this episode behind them as a lesson learned and a capital loss
earned or stay the course and hope for an eventual turnaround. It's a
tough decision. Waffles anyone?
---
Gold dot-com: Can the price of gold, the world's oldest investment,
get a desperately needed boost from the world's newest technology?
Word comes from AngloGold Ltd., the world's biggest gold producer,
investment bank J.P. Morgan & Co. and a Swiss refiner via
Bloomberg News that they are forming a joint venture to market gold
over the Internet to reach new customers and boost sales.
Customers who visit the Web site, www.goldavenue.com, can buy
everything from earrings to bullion.
AngloGold will no longer just produce gold bars, whose prices
reached a 20-year low in August. Instead, the company now has
direct access to financial markets worth $1-trillion (US) worldwide
and the $14-billion gold jewellery market in the United States.
The venture may also boost demand for gold. One analyst declared:
"The bottom line is you want someone to buy the gold."
Long-suffering gold bugs would agree that anything, anywhere, even
cyberspace, might help their cause.
[From today's NATIONAL POST, Fair Use for Educational/Research Purposes Only]
Source: Bridge newsSwiss Radio: SNB repeats gold sales likely to begin early May
Zurich--Apr 12--The sale of around 1,300 tonnes of Swiss National Bank gold reserves will probably begin in early May, the SNB press spokesman Werner Abegg reiterated on Swiss national radio (DRS). The deadline for any registered public opposition to the sale expires Apr 20, and the federal authorities say no public petition is currently being circulated. (Story .12251)
Black Blade: Could change their minds by then.
Australia J B Were says gold shares give risk reward, diversity
Perth, Western Australia--Apr 13--Gold producer shares still offer rewards and portfolio diversification in a modern investment climate, Ian Preston, research analyst at Australian brokerage J B Were and Son, told delegates at the Australian Gold Conference here. However, he warned gold mining managers that that the smaller the size of gross market capitalization in any sector, the greater the probability a fund manager can afford to ignore any exposure to that sector altogether. (Story .10524)
Black Blade: Like a needle in a haystack?
UK-listed miner Ashanti ready for challenges in year ahead: CEO
Johannesburg--Apr 12--London-listed gold producer Ashanti Goldfields has put a brave face on a tough past financial year, saying it had recorded a strong operational performance and would face the year ahead with determination. (Story .19136)
Black Blade: And a stellar performance it was too! (Guess I really didn't need to comment on this one)
LBMA March daily gold turnover at near record low, silver also low
London--Apr 12--The London Bullion Market Association said average daily cleared turnover for gold in March fell 19% to 24.2 million ounces--the second lowest level on record. The average price of US $286.39 per ounce was $13 lower than the previous month, bringing daily average value down by 23% to $6.9 billion. The number of transfers fell from 907 to 800, although they were up slightly on January's lowest ever 774. (Story .14194)
Black Blade: Whassamatta? Those dot.com margin calls slow ya down?
You seem to be the most knowledgeable person here about precious metal mining stocks.
What do you think about North American Palladium? Do you have any information about their Hedging position? Would
you prefer Stillwater or North American?
http://www.stockscape.com/stockscape_com/news/temp/recentOutput.cfm?fseqno=436223§or=miningSorry, but I'm not very familiar with the company. I know that they have some properties near the Sudbury district in Ontario. The link may help a bit. I bought into SWC a couple of years back. I visited the mine and the property in 1991. Another interesting company, and more speculative is Idaho Consolidated Metals (V.IDO). They are exploring for PGMs subparallel to SWC in Nye, Montana. The recent problems with physical delivery of some PGM's may create some interesting situations. The Autocatalyst producers may switch back to combos of Pt and Rh. Physical Pt could be a decent buy now. Who knows.
4/12/00 Indications
�Current
�Change
Gold June Comex
284.10
+.60
Silver May Comex
5.18
+.03
30 Yr TBond June CBOT
97~20
-0~05
Dollar Index June NYBOT
105.85
+0.12
Market Report (4/13/00): Gold was steady still shrugging off a report that the Swiss
gold sales could begin in May. We think the May target date as unlikely since the Swiss have
yet to solidify the manner in which the gold will be sold. As it is, the Swiss sales are
within the confines of last September's Washington Agreement among central bankers to limit
gold sales and leases, and may have already been discounted in the market. Viewed from afar
though, the market's non-reaction seems to be out of character. Given the reactions to such
announcements in the past, we would have expected a plunge. The fact that we haven't seen
that plunge makes us wonder if this gold will ever reach the public marketplace.
The Swiss have said repeatedly that the sales will handled in a way which would not disturb
the market, and we suspect they meant what they said. The combination of those two factors
has acted thus far to keep the price from dropping like it did after the Bank of England
announcement last year. The Bank of England sales have been criticized by the World Gold
Council and other analysts as a deliberate attempt to drive down the price with the
subsequent effect of wreaking havoc in the gold mining industry. The Swiss, it seems, do not
want to be similarly pigeon-holed, thus the care in the way the sales will be handled.
The Asian market was similarly calm overnight as we gear down toward COMEX options expiration
on Friday. On the positive side of the gold news, Reuters reports that gold is being
supported by investors worldwide concerned about the drop in U.S. equities markets. Another
interesting report from Reuters this morning tells us that OPEC will bank an extra $30
billion from the recent oil price surge. With the well-known Middle Eastern attachment to
gold at a time when most of the industrialized nations are printing currency like there's no
tomorrow ( Ed. Note: The British government was warned by the IMF yesterday that its budget
may "pump too much money into the economy" forcing the BOE to raise interest rates -- causing
the British government to go into a snit.), the current support for gold might be traced
directly to the Gulf States now awash in that depreciating currency. So just where is the
Swiss gold headed -- EU? the Gulf? The bullion banks?. Seems like there's plenty of takers
and maybe that's why the market thus far has greeted the announcement with a very evident,
pronounced and revealing yawn.
We'll leave yesterday's Opinion piece up for a few days for all our new visitors -- a bit of
gold philosophy to get your through the upcoming weekend.
http://www.golcondaresources.comRecent pree release of this exploratory company reported finding possible deposits in Saskatchewan. Major producers are reportedly registering interest. What do you think?
Just a general observation from one who watches lease rates: given the lease overhang in gold and silver, I would expect there to now to be more evidence of lease roll-overs than what is displayed on a daily basis. I do not see this.
This would tend to support the notion that there would have to be defaults going on. Quietly(?!)
Ted Butler subscribes to the notion that lease rates are rigged. I am beginning to lean that way myself.
Harmon and Hardy: how much is the loss of this company going to hurt the demand side? They are major fabricators of pms as well. (Also, what really happened here?)
Your figures re the drop in LBMA daily number of ounces
traded at 19% drop in March from February is quite significant. At the present rate of decline, the LBMA
will reach zero volume in March 2001. Although markets
never continuously decline, so extrapolations such as this
are dangerous, it is my opinion that when the LBMA dies,
so will the control of gold. This is also nicely after
ECB issues actual coins and paper currency, so that the
EURO will be a fully functioning currency, and finally
able to challenge the US dollar.
The above analysis assumes the LBMA data is real, which
would be a first for any public data issued re precious
metal markets. There are many who just don't believe these
figures. Indeed, if volume figures from the LBMA are real,
how does COMEX 'make' the market with only one tenth the
volume on ounces traded?
Indirect evidence that 2001 is the year to watch for
the true valuation of gold rests with the continued support
by European Central Banks for the US dollar, and continued
sales by the Dutch, British, Austrian, and Swiss central
banks. These sales could be designed to keep the dollar
price for gold under control until the EURO is ready, or
to put it another way, the dollar will be supported until
it is allowed to fall into the lap of the EURO.
Why I think the Swiss sale is GOOD NEWS at this point
Look at it this way - the Washington Agreement caps the amount of gold eligible to be sold to 400(?) tons per year for 5 years. Now, I think we are all astute enough to understand what would happen if the Swiss decided not to sell at this point...yes, we'd get rumor after rumor until someone actually stepped up to sell within the 400 tons per year limit --- NOT GOOD. With the Swiss selling, at least we don't have to worry about this scenario, and we also are fairly confident that the Swiss will use the BIS for the transactions...much better than the Brit auction method. If the Swiss didn't sell, there's no telling what we'd for a sales method by another country.
If anybody had any opinions on this , please share.
As far as I've reasoned it out so far, if a share of stock that was worth $100 yesterday is only worth $50 today. Was that $50 of lost value simply extinguished from the money supply?
If it was, could the now ending bull market in stocks have been the ultimate sucker play in order to lessen the inflationary pressures caused by too many dollars being sent overseas via the trade deficit i.e.
get the foreign dollar holders to send them back and put them into the stock market where they are simply made to disappear.
Re your >>>I've had a thought which leads to a question...
If anybody had any opinions on this , please share. --- As far as I've reasoned it out so far, if a share of stock that was worth $100 yesterday is only worth
$50 today. Was that $50 of lost value simply extinguished from the money supply?<<<<
None of the money supply is "in" the market to be extinguished. --- I went back and edited Y2K out of a previously posted tome, itself a composite of earlier posts. Hopefully, this will clarify rather then confuse this controversial issue.
***********
All money must firstly lie in either a bank ledger, wallet, strong box or under a mattress. All of us here have agreed with the empirical fact that money does not 'lie' in the stock market, even the money spent on an IPO becomes someone else's working capital, residing in their bank account.
So there is a lot of money out there, always being 'someone's' spending power unless it cycles back to the bank, reversing the fractionalization creation, or to the Fed as a repayment from the bank that originally borrowed it. Therefore the question is, who has that spending power and what might they intend to do with it.?
A record breaking amount of discretionary income has detoured through the equity markets. Specifically the earners of that income have, instead of spending it on consumption, on the capitalizing of production, or 'saving it'; decided to reimburse an owner of shares in a company and then the seller of those shares makes the decision to consume, capitalize or spend. Ergo, money "Flows thorough" the stock market rather then being "In" it.
Let us assume for now, the continuation of the present level of sales and employment and therefore the same level of discretionary income. If stock market sentiment were to decline, then the spending decisions will swing back to the income earners. In that environment, will there be more homes and new cars bought, more businesses started or expanded, or more money 'saved'? (The later, of course, is allowing the Banks to expand the amount of that money and then loan it out for one or the other of the former.)
An expanded money supply, demanding more goods and services from a specific quantity of production facility, would be inflationary. On the other hand, if a lot of spending power were used to hire the creation of more production facilities, it would not. Finally, if their was an excess of production facilities created, there would be deflation. Recession or depression only occurs if the cycle of produce and consume breaks down, from whatever cause.
Envision the Free market economy depicted as justice is, by a sculpture of a blindfolded lady holding a scale. One side weighs production, the other consumption. It all comes down to a question of balance.
In a falling market, the *outstanding money supply is changing hands, not changing in size*. If the stock market declines, gradually or otherwise, those who get less for their stock than they paid for it, have allowed some of their earnings to permanently stay in the hands of others.
What will be increasing when less money "cycles through the market" is the amount of spending decided by the original receivers of income , rather then when that spending decision was made by stock sellers. I believe last year I posted a concept of stock certificates being the fifth currency, after the dollar, yen, mark, and SF. Other than the right to take part in company affairs, the only difference is the form in which that (stock) currency is exchanged. That is why the wealth effect exists. People perceive their stock as a saved currency that will increase in value against the dollar.
It is not the inflated values considered to be the "Bubble" that I see as the danger. It is the magnitude of the overall investment capital that is passing through the equity conversion machine and exiting as spending money.
The challenge to AG & Co. is to keep that flow-through steady without expanding the bubble or scaring investors out of it either. It would appear that Investors fear of loss is becoming strongly counter-balanced by the fear of missing out on exorbitant capital gains. AG could be shrewdly playing this "like a violin" as they say.
One day some optimistic comment or an as expected rate announcement. A few days later, a little bit of a discouraging word. The market rallies, the market corrects. Investors are no longer 'making' their twenty percent. At some point they may be just breaking even. But they'll never know if next week everything will go roaring upward again. Damned if they sell and damned if they don't.
I've stated that money is a form of bookkeeping, and that a dollar is a "production chit." So, let's say a dollar is a note that says, "Pay to the bearer on demand one dollar worth of goods or services from the people of the USA. My point is that the government is not the writer of that note. The USG is the Title Company guaranteeing that note. The govt. doesn't really owe it; that note is based on the American People's ability and willingness to honor it.
As long as the citizens of this country are getting up and going to work and keeping the economic machine going, they are the primary underpinning of the US dollar. The secondary factor is how the trade value of the dollar floats in the currencies game. This massive debt that occurs from printed money represents goods and services consumed in return for goods and services not yet created. So, maybe there is a check and balance here. If global money games devalue the dollar, then the demand for American goods and services would rise, the trade balance improve, and the debt level decrease. The threat to the global economy comes from excesses. If default or devaluation of sufficient magnitude occurs and the domino effect gets triggered.
The gist of all this is that fiat money depends on maintaining the agreements behind it. (Dun and Bradstreet's motto is "Credit: Man's Confidence in Man") If the agreement can not be held in place, then a medium of exchange is necessary to hold onto value earned, and this is where GOLD has always functioned.. The big question is to what degree does one need to devote production into hoarded gold, in order to secure earnings. (That is what the central banks are wrestling with at this time. Do they back their currencies, or purchase more national necessities such as weapons, welfare or favors)
The money supply expands or contracts depending on the loaning or returning of funds, (credits) out of or into the banking system. The effect of a market crash would certainly be first and foremost a decline in spending. The "Wealth Factor", which is nothing more than an expectation of future stock sales being paid for by money being 'saved' out of future earnings, would be devastated. If stock market sentiment were to decline, then the spending decisions would swing back to the income earners. In that environment, would there be more homes and new cars bought, more businesses started or expanded, or more money saved? (The latter allocation, of course, would result in the banks expanding the money supply and then issuing loans for consumption or capitalization.) However, if there wasn't a demand for new loans due to a crash in consumer confidence, then that money would exit the Money Supply.
Years ago, people used to say" I have some stock in AT&T" or whatever company. Not "My money is in AT&T." That's all people have, a share in a company. The only money that is actually IN the market, is whatever bid is on the floor of the exchange at that particular moment. If at noon tomorrow there are bids for 2000 shares of AMZN @ $50 per share, and nothing else, then in that moment in time, the total wealth factor of the company could be seen as $100,000. First guy to sell his 2000 shares is the one who "Gets (some of) his money out of the market."
If that flow through of savings into stock sales diminished, spending would then depend on what money people were earning, and whether they saved it or purchased consumer goods. If they saved it in banks it would contract the money supply, If they kept it circulating, purchasing things, then the 'price' inflation/ deflation would depend on the willing buyer/willing seller dynamic that is the heart and soul of economics. My definition of the cause of inflation is "The power to command price." Even if wages are not earned due to a shortage of supplies to run the production, prices can still stay up there if there is 'saved' money in circulation to acquire the remaining available goods. For deflation to occur, there would have to be enough goods eagerly seeking a small pool of buyers who still were willing to spend. If everyone who still had unspent credit was scared into gold, it could go to the moon while everything else was in the tank.
I would define a depression as a situation where people cannot find the opportunity to produce and exchange with each other. The government can always print our way out of a depression. But then those who still have purchasing power will not have the opportunity to buy up the world for a pittance, so, the question then becomes "Who will the government be working for"
There is one cardinal difference between Gold (and silver) and bank note currency. All bank notes are credits, they will purchase things from others, but only so long as their debt is honored by the society that uses them for rights of exchange. A banknote basically a WeOU,. "We the people of this country owe you this numerical value of goods or services." (dependent on where inflation or deflation has taken that value when you call in the entitlement.) So in a sense, when you take currency out of the bank you are saying, "Hey tear me out that piece of the page where you have my deposit written down. I'd rather hold on to it myself." Therefore, an FRN is the last refuge of credit money. No matter what fails in the world of electronic or paper ledgers, holding your own "Ledger to go" as Aragorn then described this, is a safe solution.
What cash has in common with gold is possession at the expense of lost interest. The big difference is that only gold protects against lost value. Gold or silver or precious stones are in effect, credits exercised and transformed into the ownership of portable value. That value may fluctuate as does a currency, but it can not be defaulted. In post #2400 of 2/14-PM, I defined Gold as 'asset' money and currency as 'credit' money, I keep coming back to that as the basic criteria for analyzing the relationship between gold and paper.
http://www.SelectSectors.com/ag_xau_gcmx.gifThis chart is in percent and allows comparisons
across time periods. The proximity of the XAU
with Comex-Gold indicates a Gold rally dead ahead.
( But brief downside is still possible. )
Very low volume drop in XAU seems to indicate lots of urgent desire on the part of "fringe gold investors" to dump their gold stocks and place the proceeds in the the falling knives (dropping Dow and Nasdaq).
It seems patient gold investors need only wait for a real Naz and Dow cataclysm and to see a reversal of this trend.
Watch the gold price. It seems the XAU will follow the gold price this time, NOT precede it. One would expect that downtrodden gold investors would require confirmation of a rising gold price in order to get whipped up about gold stocks.
Just as equities created their own New Paradigm at the start of the Great Bull, then surely gold and gold stocks will create their own too, ignoring all gold market rules of the past.
"As far as I've reasoned it out so far, if a share of stock that was worth $100 yesterday is only worth $50 today. Was that $50 of lost value simply extinguished from the money supply?"
I don't believe one can realistically view nominal stock capitalization as part of the "money supply", but more of a "driver" of the money supply. The original stock issuers routinely trade shares in their corporations, virtual or otherwise, for existing system credits. Given the proper environment (this environment will do), if the system credits (fiat $) necessary to purchase shares do not exist, then stock flotation can become a primary driver for credit expansion, in order to enable the "snapping up" of these shares, as, may be argued, we have seen occurring in the recent past.
Sometimes, the shares of a company are used to purchase other companies, or to compensate employees for services rendered. Both of these activities are primarily examples of barter. When in the form of employee compensation, shares accepted are later routinely traded for existing system credits, again driving debt expansion where the supply of existing credits are insufficient to meet the demand for cashing out of the stock shares, finally materializing in the monetary compensation earlier deferred.
Consider also that the market price of a stock is in no way is directly correlated to the amount of "money" pushed into it. A single 1000 share block trade $1 above market for a $50 stock may drive up a stock's capitalization tens of millions or even billions of dollars. A $51,000 input to the system may produce the illusion of a $200,000,000 output in the capitalization bucket, distributing new-found wealth among all current shareholders. In this simple example, the decrease back down from $51 to $50 would lead to no real net systemic losses, as the original purchaser would be out the extra $1, but the original seller would be ahead the extra $1. However, the illusory systemic losses of $2000,000,000 among the various shareholders would be as astounding as the initial illusory gains were excitedly welcomed.
In terms of actual, "real" capital losses, aside from opportunity costs, it all depends on how much capital was actually placed into the market, into which stocks, how far that injected capital managed to leverage share prices up, that point at which the leveraging was at its maximum or maxima, at what point any particular person or entity became involved in the upswing, the speed and depth of the decline, and the amount of "real" capital that was further added to the system as the decline unfolded.
In short, a decline likely eats up some "real" capital and several supertankers full of "virtual" capital. The extent to which the general population and the commercial community at large had viewed (and employed!) this virtual capital as being "real" will determine the true dampening effect of a general decline in market levels. A very difficult thing to predict beforehand, I would venture.
Mr. Dow ,"Do you know how fast you were going back there?"
http://www.dailyreckoning.comSeems like money is going to have no place to hide. The divergences between the DOW and the Nasdaq are not going to continue. DOW could be headed south soon along with bonds being over extended. Alot of bottom fishing is going on but not with enough momentum to lift anything in a sustained rally. The way Nasdaq slowly crumbled today after noon was really sad(great). You can't get a bounce from something that rolls down. Well is just has to form the W and pull on out. No it doesn't "have" to do anything. How many W's have we seen start to form to simply roll over and flop down like a fish up on a bank? The shorters are getting aggressive and next meal is the DOW. As bonds top out and fall, the sunset may have a particular hue of golden sunshine in it. POG is tied to the dollar and bonds right now. Market meltdown continues in sector rotations. I see massive cash positions being built up with total indecision as to where to spend it. The same old economy stocks so abandoned during the whole nasdaq mania are now going to lead it all back up to new highs and stability???..............sure............tell that to your 3 yr old...............if he says "Goo" it means yes. If he says "Gaa" it means no. Then you can blame him when the DOW drops 300 pts per day and does no cat bounce. It doesn't always come back. 5th Elloit wave down, the meanest, toughest, and roughest wave this side of the Pecos.
No you say to your wife, "Honey, I think we should buy more stock!", then she says, "I don't know about that, it's really dropping, I wouldn't buy any more". So you say,"Yes I think you are right, we should sell." Then you take your losses. But if you sell at a loss and it was your idea......YOU lost the money and it's all your fault.....you will never hear the end of it for years.
Hello everybody. Rhody, I think you are spot on in your analysus of 2001 as being the timeframe where the forces of currency wars that have been building up for some time will blossom. I think you are right, in that only after the ECB issues the actual species will the EURO have the depth to it to be an international form of wealth holding and international settlements medium. This is so because there has to be a consencus ultimetely right on down to the little guy. Sure big players can have foriegn accounts denominated in EURO now, but its only when all kinds of ordinary people covet it, as in their travels(stealth accumulation),or able to get cash EURO, as some of the bigger US banks will convert dollars to a foriegn currency for traveling purposes. I believe this is when The EURO will have the depth to be an international reserve currency.
I myself would want to hold it on a cash basis at that time. Not in digitol offshore bank account, because I have a real aversion to checking that box on the Income Tax Form and telling the IRS the who what where why of a foriegn bank account reporting. Only when the EURO can be held in hand from the highest to the lowest persons can it make a grab for reserve status, and then for sure gold will do some neat tricks with how many dollars it will take to buy an ounce.
Peter Asher thats great stuff today on paper dollar backing(trade agreements that give credibility). What you end up with about the "Ledger to go", as it relates to holding actual bank notes, is the point I'm trying to make about Rhody's 2001 EURO cash target for "in hand", money. This whole issue was gone over by Gary North in the Y2K lead-in, when he noted that there is only so much actual cash in circulation to bankroll a "Ledger to go", while electronic digit money really has no physical existance at all.
I know actual cash EURO is only one aspect of reasons why EURO could knock dollar from world reserve currency perch, but I think the "in hand", reallity, will be the center pin if its ever going to happen.
If this post (Peter Asher (04/13/00; 12:59:10MDT - Msg ID:28562)) doesn't find its way into the Hall of Fame, then nothing will. Great stuff, beginning to end. Three others are hereby sought to voice similar approval.
John Doe's reply to Econoclast was then like a fine dessert to a great meal, and you two in tandem made for a great afternoon at the forum. Well done.
I hesitate to single out any one portion of your post because it was all so grand, but this part is a particularly important concept for people to grasp:
-----------------------------------------
You said:
Years ago, people used to say" I have some stock in AT&T" or whatever company. Not "My money is in AT&T." That's all people have, a share in a company. The only money that is actually IN the market, is whatever bid is on the floor of the exchange at that particular moment. If at noon tomorrow there are bids for 2000 shares of AMZN @ $50 per share, and nothing else, then in that moment in time, the total wealth factor of the company could be seen as $100,000. First guy to sell his 2000 shares is the one who "Gets (some of) his money out of the market."
-----------------------------------------------
Yeah--or to stick with your concept of the money that is "in" the market, the first guy to sell his 2000 is the one who lays claim to what little money that's "in" the market. Or better still, they lay claim to the amount of *currency* that has entered the market as somebody's perception of an "offer of fair exchange" for this percentage ownership of a real company. And as you and John Doe in particular both make it abundantly clear, this perception of fair exchange value (currency for partial (usually infinitesimal) company ownership) can change radically upward or downward with little in the way of fundamental cause.
To some extend, Gold is in the same boat. Considering the futures market's role in price discovery at this time, the apparent value of an ounce is determined by somebody's offer of an amount of currency in exchange for the 'privilige' of occupying one side a bet that has a definite expiration date. The bet is essentially on whether or not people will be paying more or less (prior to expiration) for the same privilege to participate in the bet. Ludicrous and preposterous, I know--but true. However, in a better world, where these futures markets were either scrapped or else restructured so that they played no role in price discovery of the metal, the price of gold would still be based upon someone's offer of currency for the real metal--though you can be sure that under this condition the amount of currecy perceived to equate with an ounce of Gold would be much, MUCH higher.
So while Gold and shares of stocks have that in common (that being the ultimate role of a market to "discover" its relative value against all other things [a fancy phrase which basically means "price" while avoiding the currency component]), there is a fundamental difference.
To be sure, owning Gold coins and owning company stock are means of owning a personal stake in a percentage of real GOLD, or a real corporation. The difference is found here: whenever mankind acquires an asset that isn't directly needed for survival in its own right but is sought as a means to facilitate that same end, it can be simply categorized as a TOOL. Currency is a tool--a means to an end. Similarly Gold is a tool--a means to an end. When viewed in the short-term, these two are very similar tools. But due to their intrinsic nature, it is truly the perceived value of the currency which fluctuates against relatively rock-solid Gold. Further, it is intrinsically currency as a tool, NOT Gold, that is susceptible to complete failure--either suddenly in a crisis, or slow and steady over time.
Sorry for that tangent, but it was necessary in order to introduce the point at which a personal ownership of a corporation is different from Gold when properly viewed as a tool to enhance your means of survival. It comes down to reliability. Gold's high value is found in its inimitable ability due to its intrinsic qualities to serve the very important role of a monetary tool to facilitate reliable storage of wealth, fair exchange, and fair accounting. In differing quatities it can fairly represent a bicycle, an automobile, a new home, or an entire nation's balance of trade settlement. It can also represent something as small as national currency units: a dollar, a euro, a yen, a peso.
Because corporations undergo differing cycles of profitability, potential for growth, or even bankruptcy, stock shares of a corporation don't lend themselves very well to being used directly as a monetary tool. They are more properly viewed as nothing more than avenues to potentially generate more meaningful monetary tools. Ideally, the valuation of corporate shares would change only in accordance with the skill of the management to "run a good ship." But, due to the incredible spiderweb of interacting contracts involved in conducting business in addition to an underlying economic climate that all factor into the profitability bottom line, the corporate valuation can fail even as the currency used to "price" it is failing also...making it a potential DOUBLE LOSER. (The same concern also applies to the various financial instruments that are merely paper derivatives of Gold. Due to their true disconnection with the real metal, they could pose double losses as their intrinsic value fails at the same time as the failure of a national paper currency that tries to represent a fair price. Again, a double loser.)
Gold is definately the sharpest tool in the shed. Settle for nothing less than the metal itself.
It's a Complicated Financial World out There...Where Some of Microsoft's Billions Have Been Going
Microsoft's Internet Binge
By Leslie Walker
Thursday, April 13, 2000; Page E01
Microsoft Corp. reminds me of Pac-Man, trapped in a video-game maze of
moving "dots" with monsters closing in from all directions. Like Pac-Man,
Microsoft is frantically fighting back by swallowing dot-coms in a partnership
binge worth billions of dollars.
Okay, so it's a stretch to compare the world's biggest software maker to the
benign underdog Pac-Man. But the battleground for control of the Internet
really does resemble a maze, and Microsoft's investment pace has been
stunning--dozens of deals in the past year, including several worth more than
$1 billion.
The company is spending $1 billion alone to create an e-business firm with
Andersen Consulting. The plan is to hire 3,000 software technicians to wire
up old-line companies. The world's largest software maker also is forking out
$5 billion for an ownership stake in AT&T Corp., more than $2 billion to
launch joint wireless ventures with cable and wireless carriers worldwide,
plus hundreds of millions to develop software research programs with
competitors.
Since late last year, Microsoft has made a flurry of investments in Web
hosting companies with expertise in delivering software online: $67 million in
USWeb/CKS, $50 million in Digex Inc. of Beltsville, $10 million in Corio Inc.
and $5 million in Interland Inc. Also this year, the company sank $100 million
into VerticalNet Inc., maker of Internet business-to-business trading
marketplaces. It is partnering with emerging industrial trading Web sites, too,
including the aerospace market announced last month by Boeing Co. and
Lockheed Martin Corp.
On its own, Microsoft is spending untold billions to develop new Internet
devices, software and services.
You might think the company a federal judge determined has been bullying
rather than partnering with competitors is trying to make up for lost time.
And you'd be right. The deals in recent months are equity investments and
joint ventures, rather than acquisitions. They fall into three key
categories--wireless services, Internet business services and Internet
consumer services. All are aimed at distributing Microsoft technology and
services strategically as the Internet goes portable.
In the battle for global dominance of the Net, Microsoft's strategy is more
complex than that of top media rivals America Online Inc. and Yahoo Inc.,
which compete chiefly in the consumer market. Unlike them, the behemoth
from Redmond must also move its core software franchise into the far larger
market for e-business.
But after flailing for years, Microsoft is turning up the heat on the consumer
front. Recently, it kicked off a $150 million, year-long ad campaign to
promote its Microsoft Network, the collection of disparate Web services that
has yet to really cohere at MSN.com. In its first big push for dial-up Internet
access business, Microsoft began offering six months of free access to new
MSN subscribers two weeks ago. MSN, launched five years ago, has a
mere 2.5 million paying subscribers today--a fraction of the 22 million
subscribers AOL has. AOL, however, appears to be signing up newcomers
at a slower rate than in the past.
That may explain why since last August, AOL's share of the total Internet
audience has slipped a full percentage point. During the same six months,
Microsoft's share jumped nearly 7 points and Yahoo's rose 1, according to
Media Metrix, which counts visitors to big Web sites.
Because Microsoft sees emerging high-capacity networks called
"broadband" as key to controlling electronic commerce, its biggest
investment binge has been in communications--the wireless, telephone and
cable TV networks that are being upgraded to carry Internet content.
Microsoft is going for broke in broadband because it recognizes that selling
access has been key to AOL's success.
"In broadband, we want to start from the get-go and be very aggressive at
building an access business," said Rick Belluzzo, vice president of
Micrsofot's consumer group.
In addition to its $5 billion stake in AT&T, Microsoft has invested $1 billion
in Comcast Corp., $600 million in Nextel Communications Inc., $200 million
in Teligent Inc. and $200 million in Qwest Communications International Inc.
Overseas, Microsoft has gone wild. It bought 60 percent of Japan's
second-largest cable TV operator this week. Two weeks ago, it joined
AT&T and British Telecommunications PLC in a wireless services venture
in Europe. It formed a joint venture with Japan's top cellular phone company
and another with Japan's SoftBank Corp. The company also bought into a
Dutch cable company and another carrier in Portugal. Oh, and did I mention
the satellite deal in Malaysia--who can keep track?
All of this is a backdrop to Microsoft's goal of moving its network of Internet
services off desktop computers and onto portable devices. Analysts,
however, note that Microsoft's portable operating system still lags behind the
popular Palm operating system for hand-held devices. PocketPC--its newest
operating software for hand-helds that will let people surf the Net, read
e-mail and write documents--is due out within two months.
Microsoft is rolling out plenty of portable Internet products this year. Coming
this summer is the WebCompanion, a compact computer designed to sit on
kitchen counters. Microsoft Mobile 2.0, its revamped wireless Internet
service, became available this month on cell phones from several carriers. It
is reworking its WebTV Network, and it joined with Barnes & Noble Inc.
last month to create an Internet bookstore where people can download
e-books.
The biggest device surprise came last month when Chairman Bill Gates
demonstrated a prototype for a new game console called X-Box. It is the
first major hardware device Microsoft intends to manufacture. The idea is to
help Microsoft compete against Sony Corp., Nintendo Co. Ltd. and others
whose game platforms are giving them the edge in online entertainment.
Since January, Gates and Microsoft chief executive Steve Ballmer have
been promising to summon analysts to Redmond to outline their Internet
strategy in greater detail, especially how all their Internet products will work
with the next generation of the Windows operating system. But the big
Internet strategy day that was supposed to be in April appears to be
delayed--at least, no date has been announced.
Meanwhile, the world's largest company throws money in all directions as it
awaits a government decision on whether it must break into smaller units as
a penalty for breaking the nation's antitrust laws. Should a breakup come, the
investment spree could give each smaller unit a better chance of surviving in
the Pac-Man-like maze of the Internet.
The Big Three
While AOL's audience has shrunk over the past few months, Yahoo and
Microsoft sites have seen their traffic increase.
U.S. audience share, in percent; audiences overlap
AOL
August 1999: 66.9
February 2000: 65.4
Percent change: -1.5%
Yahoo
August 1999: 63.7
February 2000: 64.7
Percent change: +1.0%
Microsoft
August 1999: 55.5
February 2000: 62.3
Percent change: +6.8%
NOTE: The total U.S. Web audience was 63 million in August 1999 and
70.3 million in February 2000.
Executive summary for those without the patience for my long commentary
"Considering the futures market's role in price discovery at this time, the apparent value of an ounce is determined by somebody's offer of an amount of currency in exchange for the 'privilige' of occupying one side a bet that has a definite expiration date. The bet is essentially on whether or not people will be paying more or less (prior to expiration) for the same privilege to participate in the bet. Ludicrous and preposterous, I know--but true. However, in a better world, where these futures markets were either scrapped or else restructured so that they played no role in price discovery of the metal, the price of gold would still be based upon someone's offer of currency for the real metal--though you can be sure that under this condition the amount of currecy perceived to equate with an ounce of Gold would be much, MUCH higher."
Regarding corporate stock prices/values, "due to the incredible spiderweb of interacting contracts involved in conducting business in addition to an underlying economic climate that all factor into the profitability bottom line, the corporate valuation can fail even as the currency used to "price" it is failing also...making it a potential DOUBLE LOSER. (The same concern also applies to the various financial instruments that are merely paper derivatives of Gold. Due to their true disconnection with the real metal, they could pose double losses as their intrinsic value fails at the same time as the failure of a national paper currency that tries to represent a fair price. Again, a double loser.)"
When considering Gold oriented investments, settle only for Gold metal, my friends; and ride the eventual wave skyward as it attains it true relative value against all things.
It will be interesting to see how the recent tech bear and legal difficulties impact on Microsoft, given that 25%-30% of Microsoft's revenues come (or came) from the sale of put options on its own company stock. This worked because Microsoft stock seldom if ever went down. Not true now!!! The once cash cow could now be a major source of losses.
If you look at yields on long bonds in EU UK and US you will see that the perfect correlation of UK and US bond yields has broken right after the Washington Agreement. After which the Gilts have traveled with the German Euro-bond in tight identity of Yields.
Short rates for the UK, however, are still identical to US rates. The UK-EU long yield convergence is a defacto monetary equivalence (however rough) for the Euro and the Pound, akin to that for the Swiss Franc. The Brits are being pulled into the EU since early Oct 99. This leaves the US without its only monetary ally in Europe.
This subject of talking about Microsoft on a gold discussion
forum may not be appropriate, and it bothered me. So, I
sent Michael a personal e-mail to see if he objects.
Perhaps he will comment.
Best regards to Michael and all of our fine participants
Microsoft represents the epitome of the bubble paper stock market.
The article 28572 posted by Leland neglected a minor detail... Microsoft p/e ratio will go into never-never land very soon. The "investments" are an attempt to spend MSFT paper stock while it still has some perceived value.
Do you what means of price discovery is employed for the Gold transactions conducted through the BIS? I know the BIS as part of their regular fuctions faciltates transfers of Gold on behalf of their account holders, and I would assume that the conditions of the various transfers might (might not?) make them different from what we saw with the latest mobilization by the Ductch CB through the BIS. If the Dutch, and now Austrian, (and likely Swiss) Gold mobilizations are a unique form of operation, is there an element of price discovery for each independent Gold mobilization? I'm also currious about the transparency of the "going price" for real metal through these official channels.
As I reflect on the Dutch operation, I recall that the ECB's weekly balance sheet simply revealed the value of the mobilized Gold as the product of the current official ECB Gold book value (marked to market each quarter, as we all know) and the tonnage placed through the BIS. In the event that this Dutch Gold was involved in what could be deemed a true "sale," the reason I question the validity of assuming the officail ECB price to be the sale price is related to what the IMF has done recently. For the benefit of those following along, but not familiar with the recent IMF Gold "sales," after selling IMF Gold at prevailing market value to member nations and then accepting it back in settlement of their debts, the IMF continues to carry the Gold on their own books at their official value of 35 Special Drawing Rights, while the "excess currency value" gets funnelled into an investment account--reportedly held by the BIS. I'm simply wondering if there is "excess value" generated in these Dutch/BIS style operations that aren't reflected in the existing level of transparency--that being the valuations only revealed through the fixed ECB statements.
Ultimately, I guess I'm not overly concerned with the mechanics themselves. What I find myself to be most intrigued by is the possibility/potential of additional transparency in these BIS-facilitated operations that might reveal a pricing disconnect with the London and New York markets. Or would that constitute an unacceptible rocking of the boat, in which case they (BIS faction) will bide their time behind the veil of the ECB official price until the LBMA and New York will have crashed themselves through the discredit of non-delivery?
Have really enjoyed your commentary. Sorry I haven't had more time to engage you in discussion.
Getting back to the IMF before I sign off for the moment, it looks like they are at least structurally postioned to function in accord with my proposed "perfect monetary system" regarding the role of Gold as a non-lendable/non-inflatable asset. From their recently updated website--though admittedly there is nothing NEW here:
"According to Article V, Section 12 (b) of the IMF's Articles of Agreement, any transactions in gold by the IMF require an 85 percent majority of the total voting power in the IMF. The IMF may sell gold outright on the basis of prevailing market prices; it may accept gold in the discharge of a member's obligations to the IMF at an agreed price on the basis of prices in the market at the time of acceptance. The IMF does not have the authority to engage in any other gold transactions, e.g., loans, leases, swaps, or use of gold as collateral, and the IMF does not have the authority to buy gold."
Gold. It's not just for barbarians anymore. ---Aristotle
I have heard of Golconda before, but most of their focus was in gold and diamonds. It sounds very interesting that we now have exploration companies pursuing PGM deposits in N. America. I am somewhat reminded of the Diamond rush in Canada by these events. Maybe this will spark a bit more interest among investors now that the equities markets have been sinking lately. Hopefully the result will be more investment in PMs and PM producers. Most of N. American PGM production was at Stillwater Mining as a primary producer, but also secondary production from INCO and Falconbridge nickel producers, and most of the secondary PGM production is from the Sudbury District (which is an old meteorite impact site). As long as exploration companies are successful finding mineralized Layered Mafic Intrusions, we are likely to hear more of PMs and PM producers as viable investment opportunities as the news hits Wall Street. The recent troubles in Zimbabwe have been cause for concern for investors in S. African mining ventures. The fear of course is that there could be some "spill-over" into S. Africa. The question for these small exploration and mining companies is whether they can get funding to get into production without losing a controlling interest. Royalty companies such as Franco-Nevada and Royal Gold have been sources in the past. These could be exciting times in the mining industry. Who knows. Safest option of course is to hold physical Pt, at least until these problems are sorted out.
Of the 43 Fidelity Mutual funds that I track daily, today 40 of them went down, 2 went up, and the gold fund was unchanged. Maybe investors are begining to see gold as a safe haven in a bear market.
From Stanley Fischer's IMF Spring Meetings press conference today as a prelude to the Interim Committee (oops, I mean the International Monetary and Fiscal Committee) meeting this Sunday.
"First, debt relief was promised last year, but it still hasn't all been paid for by the owners of the various institutions and bilateral creditors. We in the Fund are fortunate that we had the gold resource available to finance a quite large part of our contribution to the HIPC Initiative. But, for some other institutions, particularly the regional development banks, it remains unclear how they are going to pay for the current initiative, and obviously let alone for more generous relief campaigns that many would want, and even we in the Fund still have "sold" only 9/14 of the relevant gold. We need permission to proceed on the other 5/14, and that would require congressional approval."
http://www.thebullandbear.com/resource/index1.htmlHere are a few PM articles for you insomniac goldbugs and goldbuguettes ;-) These articles should cheer up any depressed pro-gold investor. MK has an article in the archives as well. Anyway, this is a just little light reading to go along with your late light Zane Grey, Tom Clancy and Alistair McClean novels. Just follow the link.
Gold Shareholder Meetings and GATA...time to get mad!
A crucial month is approaching, the month of gold mining company annual meetings and proxy votes.
For many of these companies, if the price of gold does not start making a run for 350 or higher very soon, then there will be no more annual meetings next year, 2001. For many of these companies, survival will not carry them into the next year.
So, gold shareholders must send these guys a message. Take your proxy forms and vote AGAINST all management re-elections, vote AGAINST all poison pill suggestions, vote AGAINST all stock options packages, vote AGAINST all auditor nominations....basically, vote AGAINST every conceivable proposal they offer.
When these guys see that the shareholders want them voted out and all their proposals voted down, they will be very anxious and very curious why such a negative reaction is occurring.
The shareholders must explain to these categorically dim-bulb gold managements that the status quo does NOT work anymore. Hedging gold is a short sale and does not support the gold price. Acting as a servant to bullion bank wishes does not serve the best interests of the gold mining industry, it supports the best interest of the gold shorting bullion banks. Turning their backs on GATA, the only organization out there agitating for some kind of transparency in the gold market, is not acceptable. Supporting ineffective, grossly stupid World Gold Council gold ads is NOT effective propaganda for gold promotion.
VOTE these guys out of their jobs, vote down all their proposals, send them an unequivocal message or most likely you will not be voting next year at all because your favorite gold producer will be in bankruptcy.
Thanks to an old gangster on ''The Sopranos,'' a slang term new to me
gets its 15 seconds of fame, and just in time.
The word is ''spondulicks,'' spelt various ways in its haphazard derivation
from the Greek. And its reincarnation in a TV series more famous for grit
than Greek is timely because it means money, wealth, moolah. And moolah
is what makes the world go round, as every day's news attests.
In ancient Greece, a seashell called ''spondylos'' came into currency as the
equivalent of cash, and when you went to pay off your old Athenian loan
shark, the Grecian equivalent of Tony Soprano, you saved him from
breaking your legs by forking over a pile of ''spondylikos,'' if I read my
dictionaries right.
What to the Greeks was a ''learned witticism'' came to America's shores by
the mid-1850s with all the other immigrants. Here the spelling morphed into
''spondulix'' and ''spondulics.'' But just as the Sopranos are less interested in
spelling than in spending, focused more on murderous accumulation of pelf
than on morphing of ancient vocabularies, our society's fascination with pelf
is limitless.
Our Almighty Dollar is the world's currency, just as the language we
hijacked from Britain has become the lingo of air travel, high tech, low-brow
video, and middle-brow tourism.
Badinage about boodle dominates our discussion. Whole TV networks are
dedicated to the daily desuetude of Nasdaq and the Dow. Temples of
wealth such as the World Bank and the International Monetary Fund are
besieged by protesters in Washington. Filthy lucre is what makes the world
go round, to listen to the daily output of us ''content providers.'' You can't
eat it, drink it, or breathe it, but we spend more time fussing over the old
dinero than we do over food, clean water, and clean air. Cutting ourselves in
for more cabbage is the principal activity of the age.
Tote that barge; get that gravy. The search for shekels is endless. Just ask
the Irish sailorman who sings of how ''I spent all me tin on the ladies drinkin'
gin,'' so he's off to the western ocean in the morning. God is great, but
Mammon is running a close second on the wish list.
Siphoning simoleons is America's business. And for a couple of years the
stock market has been where you find the wherewithal. As the Nasdaq
swoons, our hearts go out to Bill Gates. The world's richest man has lost 20,
30, who knows how many billions as Microsoft stock took the biggest hit
ever. Hey, buddy, can you spare a dime? Yes? Great, slap it right down
there on the barrelhead. Keeping track of the lettuce employs armies of
earnest experts, who people our video screens, scrubbed and coiffed to the
standard expected of cable television.
The market meltdown ensnares millions. A nice string of coconuts turns into
chicken feed as the bottom feeders probe for the floor. Is this the day it turns
around? The hour? The minute? Where's Lou Dobbs when we need him?
Four bits is worth two bits in the click of a cursor as cheerleaders become
cursers. What was a sawbuck's worth of shares yesterday is a finnif's worth
today. Where'd the rest of it go? You feel like shouting ''Hey!'' But it ain't
hay.
It's the long green, suddenly in shorter supply. What's going on here? Is Alan
Greenspan on vacation already? We're talking carfare here, for the longest
bull market ride on record. We didn't mind the grubbing, even when it got
grubby, but what happed to our grubstake? We'd grown fat and happy
reading a different script for our scrip.
What gives? What takes?
The market giveth, and the market taketh. And we all, most of us, just about
all of us except the short traders, liked the giveth better than the taketh. And
speaking of the short traders, what about the tall traders? Where did they
disappear to? We all more or less held something back, what the old song
celebrated: ''That's my old ace in the hole.''
For the margin traders, who have to cough up when Nasdaq gets bronchitis,
there's no longer any trace of the ace. Or the king, queen, jack, or 10, for
that matter.
A severe case of the shorts is catching up with a lot of those day traders,
and we're not talking underwear here. All those high-tech chasers who failed
to cash out at the top will be wearing barrels, not boxers or briefs.
Where'd all the wampum go?
It went up in smoke above the bonfire of technology investments. Who lit the
match? Look no farther than the judge in the Microsoft case. Thomas
Penfield Jackson may go down in legal texts as the jurist who saved the
world from the Microsoft monster. But his findings hit the hydrogen-filled
Nasdaq balloon like a lightning bolt finding the Hindenburg. Fully 25 percent
of the market went poof.
And to those investors, the good judge is seen as the reincarnation of Marvin
The Torch. Marvin was columnist Jimmy Breslin's classic arsonist, a
''Sopranos'' kind of guy, whose calling card was his claim to felonious
property owners: ''I can build you a vacant lot.''
[From Today's THE BOSTON GLOBE, Fair Use For Educational/Research Purposes Only]
Europe Precious Metals Review: Gold inspects support at $280
London--Apr 14--Spot gold continued to be firmly capped by the US $281 per
ounce level Friday and as a result turned its attentions to support provided by
the $280 mark, occasionally slipping below there in light trade. Silver was
similarly capped at $5.15 but found generally solid support at $5.10 in light
trade, while platinum and palladium edged sideways at overnight levels. (Story
.2270)
Asia Precious Metals Review: A lack of buying caps gold at $281
Tokyo--Apr 14--Spot gold was capped at US $281 per ounce Friday in sluggish
Asia trading, dealers said. Platinum broke over the key $500 following overnight
gains in the US market but a lack of follow-through buying prevented prices from
sharply rallying during Asian trading hours ahead of the weekend, they said.
(Story .2200)
Aristotle's latest post has me thinking about the sales of gold by Austrian, Dutch, Swiss interestes etc.
Thinking then along the lines of YOUR commentary......
1. Why would any European government, bank or other "official" party sell gold at this point in time; even to another Euro member (thru the BIS)? These holders of gold "grasp" fully the thoughts you reveal yes?
2. Why would any of these official sales be transacted at the prevailing price of gold when in your estimation, the price of gold within five years should easily be, "at least five thousand dollars"?
I would greatly appreciate your pointing out my deficiency in understanding and "grasping".
Also, it is good to see your "overviews" from January where they belong. IMHO, they are your best.
I haven't been too far away, just waiting for and digesting some further discussion with friends. Things are really looking up for the gold markets now. Truly a great day for physical advocates. I'll be here (this forum) and on the trail over the next few days. Will include your --- Cavan Man (4/14/2000; 6:05:29MDT - Msg ID:28592)-- observations also (along with others).
Au strong outta the gate, CPI up higher than expected!
Gold up $2.60 outta the gate. s&p futures suddenly down.
Here's why
NEW YORK -(Dow Jones)- U.S. consumer prices rose by a greater-than-expected 0.7% in March amid a runup in energy prices, the Labor Department reported, while the so-called core consumer price index rose by a greater-than-expected 0.4%.
Wake up everybody, Au up to $283.70 and still rising! Wall Street could be rough today. Watchout for them falling brokers! Why there's Ron Insana now - splat!!!!
A lot of people who own 6% govies got a loud wake-up call with the CPI numbers this a.m. With general inflation arguably above 5% now, 6% taxable interest becomes a losing proposition. No, Abbie Joseph Cohen, inflation clearly is not yet priced into the markets, not the equity markets, not the debt markets, and sure as heck not the precious metals markets.
http://www.usagold.comDon't you folks(Farfel) think that some of the biggest gold mining shareholders are the bullion banks themselves? Now that would make sense.
http://www.usagold.com"And I've got such a long way to go.......Such a long way....I wish I'd hit the shores of Mexico"
"I was floating, I was floating.......floating with the wind..........du.....da......du...da"
"And I've got such a long way to go....such a long way.....to get away from this scarey bitch Reno......cuz I'm running, I'll be running.......run with the wind......du...da du....da"
"Cuz with my dad I just don't want to go..........Cuz if he really loved me he wouldn't have stayed on the dock yo?.............I'm still running......I'm still running......run like the wind..........du.......da...du...da"
Today's Report: On the Consumer Price Index, a Smoke-Filled New Paradigm and Canute Exhorting the Tide
http://www.usagold.com/Order_Form.html4/14/00 Indications
�Current
�Change
Gold June Comex
286.60
+3.40
Silver May Comex
5.21
+.03
30 Yr TBond June CBOT
98~10
+0~01
Dollar Index June NYBOT
105.35
-0.57
Market Report (4/14/00): Gold notched a strong gain in the early going
with at least three factors playing a prominent role:
1. the unexpected non-reaction of the gold price to the
announcement that Swiss sales could begin as early as May, 2000
2. the expected, continued and deepening weakness in the world's
equity markets, particularly Wall Street
3. an inconvenient surge in the Consumer Price Index of .7%
which suddenly catapults the inflation rate toward dangerous
double digit territory
It seems that the Greenspan inflation phantom has finally shown itself in
full regalia. As money exits the stock markets, it could exacerbate the
inflation rate as more money chases fewer goods (in an older parlance) --
unless the stock market suddenly tips its nose toward the ground and goes
into an uncontrolled dive. If that were to occur, all bets are off: Capital
could go up in flames so completely and swiftly that inflation could turn to
deflation faster than you can say "1929". Not that we wish for such things.
We simply recognize that such a thing could happen. As it is, we will
suggest, as others have over the past few days, that a judicious
diversification into yellow metal might be in order since it protects against
either inflation or deflation no matter in which order they arrive. Other's
have already gone that route over the past few days with strong physical
demand (as reflected in today's rise) being reported from all quarters. Gold
appears to have suddenly regained its place as the contra-cyclical investment
to plummeting stocks -- another older phenomena now resurfacing amidst this
mumbling, grumbling, smoke-filled new paradigm.
(Ed. Note: A week or two ago we mentioned in this report that mutual fund
investors would be receiving their quarterly statements in mid-April and that
the stock market could take a turn for the worse when the public found out
that the previous losses in the indices would indeed translate to losses in
their mutual fund accounts, and reacted to it by reducing their equities'
exposure.)
That's it for today, my fellow goldmeisters. Don't be surprised if the
pro-stocks, anti-gold Wall Street faction does something today to kill gold
and resurrect stocks once again. One wonders how many bailouts these people
can muster. As someone said at our Forum last night: It's like shore-bound
Canute exhorting the tide not to come closer.
We'll leave the last two reports up for the weekend for those visiting us for
the first time. By the way, if you are new here, we extend our welcome and
hope you find this a comfortable place to visit for the latest gold news and
views. You certainly won't get this sort of thing from the mainstream press.
If you would like to receive our newsletter please go to this link and make
the appropriate entries:
ORDER FORM SEE ABOVE
By the way, we have not gotten the April News & Views written and out due to
other writing commitments. Those are now complete and we will try to throw
something together as soon as possible. Those suffering News & Views
withdrawals will have to content themselves with this Daily Report and the
dynamic discussion over at the Forum for another week or two -- not a bad
trade-off.
It could be an interesting day. Have a good weekend.
To be effective we need to have a large coalition of people dedicated to peaceful and lawful methods who will work together to combat the considerable interests stacked up against us.
The World Bank and IMF are not merely a significant drain on U.S. Taxpayers and a threat to self Government. They also use the leverage that they purchase with our TAX DOLLARS as a means to force less developed countries to take on a new and HARMFUL monetary and economic regulations.
We Need To Shut Down The Intire Monetary Apparatus And End The International Welfare State!!
End of quote, click URL for full news release.
Comment: It sounds to me like some members of the U.S. Government are getting uneasy concerning civil unrest in the U.S.A. This dispite high employment figures. What's going to happen if and when unemployment rears it's ugly head, and schools close for the summer.
...buying Gold as personal finances allow...beesting.
This should be the time Gold makes it's move upward!
http://www.kitco.com/gold.graph.htmlWith most of the stock markets in the world in crash mode at this hour, shouldn't Gold be make-ing a move up??
We watch together......beesting.
Despite the fairly strong downward bias in the stock market, we are nowhere near a crash.
There are far too many bull market stocks that are indifferent to the market downswing or actually rising in opposition to it.
Companies like Sun Microsystems, IBM, Intel, Micron, etc. are hardly fazed by this so-called bear market. Until these bellwethers begin to experience real weakness, then this downswing cannot be termed a crash in any sense of the word.
Most importantly, until the internets truly crack, then this downswing cannot be described as particularly alarming. Yet companies like EBAY are rising this morning (last I looked) and until such overinflated stocks begin to weaken notably, then the psychology still remains very bullish out there.
As for gold, it is proving oblivious to MOST of these strong downswings and that portends well for it, particularly given the strong measures to suppress the gold price and gold stocks on days like this. CNBC never gives a mention to gold stocks today, such is the continuous war against the metal. As one of the only sectors with any strength today, doesn't the gold sector deserve at least 15 minutes of positive discussion?
Now back to gold companies: once again, I urge mining shareholders to vote AGAINST all proposals by ALL gold companies, from the sublime to the ridiculous. If they want special options packages, say NO. If they want a specific auditor re-elected, say NO. If they want their Board of Directors and new nominees re-instated, say NO! Give them a wake-up call they have never heard before because if you do not act now, then the odds favor that your favorite gold producer will be in bankruptcy come next year and you will not get the chance again.
Of course, there are those who would say, "Just hold it, you can't blame the gold producers for the crappy performance in their stocks. They are simply victims of a bad gold price, low inflation, and the most anti-gold Establishment in history."
I say, "Bullshit!"
These guys have sat on their hands during this entire mess and done nothing creative or effective to change perceptions about the industry. Their worst offence: NOT supporting GATA in some fashion or another. GATA is the only organization out there lobbying for transparency in the gold market. Whether or not you think GATA is too "conspiracy-fixated," the bottom line is this: it is the only group out there demanding that this shadowy gold market open itself up for public examination. Otherwise, what sense is there in any rational person investing in it?
World Gold Council ad campaigns are a joke: conquistadors babbling incoherently about gold does nothing to change public perceptions.
Where is the World Gold Council when it comes to Switzerland? Why did the gold producers fail to use some portion of their exploration funds for mounting an effective counter-lobby in advance of the coming Swiss gold sale? It makes more sense to create an effective lobby against central bank gold sales than to open up another unnecessary gold mine in the world? Why are the gold producers completely asleep at the wheel?
Why are the gold producers NOT bidding at each and every one of these Bank of England gold auctions? It makes more sense to buy the physical gold outright than mine it at a loss owing to these absurd low prices.
Why are the gold producers NOT screaming bloody hell at mainstream media institutions like CNBC that refuse to air a single notable positive minute about gold stocks during days like today?
Does GATA have to do everything, without any significant amount of money, and at the same time, suffer the abuse and ridicule of these gold producer executive shitheads?
VOTE THEM OUT!! VOTE AGAINST EVERY SINGLE PROPOSAL THEY MAKE!! SEND YOUR PROXIES IN AND TELL THEM TO GO TO HELL!
The litany of inaction and ineptitude on the part of the gold producers is simply so apalling that I cannot begin to describe it on this forum or I would take up all of Michael's website memory.
Looking for the silver lining on inflation numbers
Hi guys n' gals! I haven't posted in awhile. Today's Inverstor's Business Daily has a hopeful article on its front page about how the recent PPI will cinch a rate4 hike but that better times are ahead for inflation since it's really must an anomaly due to the OPEC manipulation of the price of oil. "We know that two or three months froim now, we'll have a decline in gas prices, making the overall inflation rate also look more comforting than it does now in producer prices." Orr said (David Orr - chief economist of First Economics Group) "These friendlier rates will keep rates from rising too much." He goes on to say that inflation is really fairly tame and so in effect: don't worry - be happy! Meanwhile, last I looked, the Equities market was in a pretty steep decline. By a few months from now, maybe they will be at a more reasonable level (like 50% lower) and Orr might be right. Problem is, if that happens there will be rioting in the streets by all the disgruntled stock investors. I wonder where the PPT is?
By the way. A few weeks ago, someone re-posted a prediction for a steep stock moarket decline that originally appeared on Kitco. I remember the guy saying that if his prediction doesn't come to pass within a few days that he'd quite posting. (We've all heard that before.) Whoever it was, though, surely was right. Anyone remember who the poster was and what date and time that posting appeared here?
Welcome back, Strad Master! That was Ben on Gold-Eagle. He has been posting very frequently lately, and his predictions are coming true. He was thrown for a loop last Tuesday (he had everything right, but the PPT messed it all up), but he's right on the money now.
Is that too strong a term to apply to today's world economic reality?
-------------------------------------------------
Trail Guide:
After a few walks, I believe I understand. Thank you very much for sharing your understanding and insights!
http://www.usagold.com The apparent crashing stock market illustrates the real value vs. percieved value. The high Nasdaq was driven mostly by BELIEF. People believed the stocks were worth it and that belief re-inforced higher and higher stock prices. The underlying reality is that companies that have no profit yet are only perceived value or potential value which may or may not be realized. IT APPPEARS WHAT IS GOING ON NOW IS THAT REALITY IS CRASHING INTO A FALSE BELIEF.
As far as Gold is concerned, it has not had perceived value with investors. It had been perceived as a poor investment. With a crashing stock market and inflation indicators rising that may be changing. Investment dollars have to go somewhere.
If Gold begins to be perceived as the best safe haven in troubled economic time, then it has perceived value once again to investors. This percieved value then feeds on itself stimulating demand, and the price of Gold will skyrocket.
The missing element in the Gold market (investor demand) may soon come crashing into it like a tidal wave, coming like a Tsunami from the earthquake of the NASDAQ.
http://www.usagold.com I noticed the Dine letter recommended Stillwater, but has anybody looked at their reccent SEC filing and there hedge position. I briefly reviewed it but have not had time to do so in depth.
Are they hedged to such an extent they cant profit from Platinum and Palladium rises?
In light of what is happening in the stock market averages today (DOW: -382.61 Nas: -272.24 S&P: -58.13), the following piece of spam that just came across my desktop seems interesting and resonates with what BEN has been saying at Gold Eagle... Kitco completely unavailable today... A Greenspam speaking about risk right now on TV. Was this previously scheduled? Does anyone know? SPAM follows:
If you have been following my posts for the past few months, you will not find what is currently happening much of a surprise. On Tuesday, April 4, 2000 at approximately 12:40pm Eastern time, all U.S. stock markets went into financial arrest. Liquidity had completely dried up and all trading completely stopped. There was a liquidity vacuum in the stock market unparalleled in history. Less than a minute later, the monetary defibrillator was applied using a 3 TRILLION dollar injection into the system, which started the financial heart beating again. I have the financial EKG to prove it, which was corroborated by a number of different sources who refused to comment. All that was seen and heard behind the scenes were pale faces and trembling voices. We had just barely managed to avert the equivalent of a 9.0 magnitude financial earthquake by a few seconds.
The implications of what had happened is not fully understood and is even being ignored, commonly known as plausible deniability, by even the most educated and influential financial experts, money managers, and government financial authorities in the country. The events of Tuesday were characterized flippantly by the press as nothing more than a 'rollercoaster-ride day' on Wall Street - with the market rebounding impressively in the afternoon. That is like saying that the Chernobyl nuclear accident was just a belch by a plant operator after a big lunch..
Professional traders and market technicians, like myself, know exactly what has happened and what it all means - just like the coal shovelers in the engine room of the Titanic when she struck the iceberg. The 1st class passengers topside felt only a 'bump' as their Champaign glasses wobbled a bit, but nothing was wrong assured the Captain and crew. The crew and passengers below the waterline new different and were terrified - they knew that the ship had actually been holed and was sinking.
As a professional trader, I watched the stock market yesterday from the perspective my long lost counterpart in the persona of the Titanic's coal shoveler, or a more modern counterpart in the Chernobyl reactors rod operator. I was so shaken by what I saw I stayed up to nearly 3 a.m. looking at volumes of statistical data for the day including the minute by minute price and volume prints, 'tic' charts, and internal indicators of what really went wrong inside the stock market. Metaphorically, in medical lingo, you could say that the stock market had an ischemic attack (stroke or coronary artery spasm) but nobody REALLY understands what has happened since most have not been around long enough to have seen anything like this. 1987 was a good model but of MUCH LESS intensity.
As I realized what had actually happened, my hands began to get sweat and my throat tightened as I came to the conclusion that the greatest asset bubble of all time, the U.S. stock market, had finally found its pin. However, the FED knew exactly what was coming the day before.
I spent the night and all of today making phone calls to key individuals to verify my suspicions and then began to exercise my metaphorical financial launch codes, hedging all open positions and leaving nothing uncovered. If any of you, the truly market savvy, have naked put or call positions or positions which open you to unlimited risk offset them immediately! ABOVE ALL, DO NOT TRY TO PLAY THIS FINANCIAL CRASH THINKING YOU CAN GET RICH BY SHORT SALES OR SIMILAR INSTRUMENTS!!!
We are to be going into much greater detail this weekend in the Global Preparedness News Analysis and Commentary section and will be coming out by the 15th of April with a special alert newsbooklet entitled 'The Minute the Market Stood Still'. It will have all of the reports, hard technical data such as charts, graphs, and minute by minute tabular data that will support my thesis and leave no doubt in YOUR MIND that a financial collapse is imminent.
It will be available to all AIPL COMMUNIQU� subscribers for free and to those of you who have supported me in the past. All those who are unpaid surfers there will be charged for the booklet, in which I will be giving the details about what strategies will get you through this time of crisis.
Only general synopses will be posted on the eProvisions website - but it will better to be a little informed than not at all. This is assuming, of course, the whole financial system has not blown apart by then. THAT is how critical the situation is in my opinion.
IN SUMMARY:
THE U.S AND GLOBAL FINANCIAL MARKETS ARE IN THE GREATEST FINANCIAL PERIL SINCE THE STOCK MARKET CRASH OF '29, THE ENERGY CRISIS OF ''73-''79, THE LATIN AMERICAN DEBT CRISIS OF '82, THE S&L CRISIS OF '87, THE MEXICAN DEBT CRISIS OF '94, AND THE GLOBAL CURRENCY CRISES OF '92, '95, AND '98 - ROLLED INTO ONE. THAT SAID, I AM PROBABLY STILL UNDERSTATING THE SEVERITY OF THE SITUATION!
This Friday could be a pivotal day and I would be surprised if we DID NOT have a BANK OR STOCK MARKET HOLIDAY sometime in the next few weeks. The Federal Reserve may have a plan to stem the meltdown, but I DO NOT BELIEVE IT WILL STAVE OFF THE EVENTUAL DEMISE OF THE POST BRETTON WOODS FINANCIAL SYSTEM. We know bits and pieces of the plan which was presented in a secretive bill introduced by Senator Patrick Leahy several years ago. Again, we will be publishing all of the detail in our booklet.
WE ARE NOW HEADED INTO A INFLATIONARY DEPRESSION. THE FIRST SIGN THAT THINGS ARE TERMINAL AND IT IS TIME TO FIGURATIVELY HEAD FOR THE HILLS, IS A RISE IN PRICE OF GOLD ABOVE $330 PER OUNCE FOR THE THIRD TIME. IF IT BREAKS THROUGH WITH A CLOSE ABOVE $350 THIS WILL MARK THE END OF THE BEAR MARKET IN HARD ASSETS AND THE COLLAPSE OF THE VIRTUAL ECONOMY.
If you want to get an idea of the scenario which is very close to my own without getting my booklet, get Harry Figgies book, Bankruptcy1995, and CAREFULLY read the introductory chapter. More details are to come as they develop so check with us here at GPN every day.
Dr. Rod Lewis
Registered Commodity Trading Advisor
Editor/Global Intelligence Analyst
Global Preparedness News
www.eprovisions.com
Excellent post! These SOBs should all be thrown out of officer. They should be cutting production and buying the bullion being given away at the BOE auctions.
The root cause of the gold bear is the huge amount of CB gold available for lease at absurdly low rates.
Let the CBs sell all the gold they want. But all friends of gold should mount a determined campaign to get them to cut back gold lease volumes enough to push lease rates to say 5%. That would effectively kill the carry trade and incidentally result in much higher prices for the gold they want to sell.
People may differ about the future of gold as a financial asset. But when they learn their CBs are following policies that enrich a small group of bullion banks while lowering the price received for gold sales, they will be up in arms.
I sometimes am able to access Kitco by going a back-door route -- I'll click on "Live Quotes and News" and from there go into the Forum. Sometimes it works when the home page doesn't get me in.
Your post is VERY SCARY!! Got Y2K supplies? If there's a banking meltdown you don't want to be caught low on groceries and other necessities.
"I am sure that nostalgia for the relative automaticity of the old gold standard will arise among those of us engaged to replace it." -Federal Reserve Chairman Alan Greenspan to The American Enterprise Inst., 1:07:55 PM
I am pleased to participate in today's conference and to join others in the justly deserved tributes to
Anna Schwartz. She has been most interested, among a wide variety of other subjects, in the
connections that economic and financial policies have to financial crises. As a consequence, I have
decided to speak about technology and financial services, and particularly about risk management,
issues that I have spent a good deal of time addressing in recent years. As a related matter, I will
comment on supervision and regulation as we move into the twenty-first century, and of course, I
shall find a way to touch on the role of central banks.
Without doubt, the acceleration in technology that has produced such an extraordinary effect upon
our economy in general has had a particularly profound impact in expanding the scope and utility of
financial products over the last fifteen years. Information technology has made possible the creation,
valuation, and exchange of complex financial products on a global basis heretofore envisioned only in
our textbooks, and even that just in recent years. Derivatives are obviously the most evident of the
many products that technology has inspired. But the substantial increase in our calculation
capabilities has permitted the putting into place of a variety of other products and, most beneficially,
new ways to unbundle risk. What is really quite extraordinary is that there is no sign that this process
of acceleration in financial technology is approaching an end. We are moving at an exceptionally
rapid pace, fueled not only by the enhanced mathematical applications produced by our ever-rising
computing capabilities but also by our expanding telecommunications capabilities and the associated
substantial broadening of our markets.
All the new financial products that have been created in recent years contribute economic value by
unbundling risks and reallocating them in a highly calibrated manner. The rising share of finance in
the business output of the United States and other countries is a measure of the economic value
added by the ability of these new instruments and techniques to enhance the process of wealth
creation. The reason, of course, is that information is critical to the evaluation of risk. The less that is
known about the current state of a market or a venture, the less the ability to project future
outcomes and, hence, the more those potential outcomes will be discounted.
Financial intermediation, although it cannot alter the underlying risk in holding direct claims on real
assets, can redistribute risks in a manner that alters behavior. This redistribution of risk induces more
investment in real assets, presumably engendering a higher standard of living. This occurs because
financial intermediation facilitates diversification of risk and its redistribution among people with
different attitudes toward risk. Any mechanism that shifts risk from those who choose to withdraw
from it to those more willing to take it on increases investment without significantly raising the
perceived degree of discomfort from risk borne by the public.
By itself, more abundant real-time information should both reduce the uncertainties and lower the
variances employed to guide portfolio decisions. At least part of the observed fall in equity premiums
in our economy and others over the past five years may have resulted from a permanent
technology-driven increase in information availability, which by definition reduces uncertainty and
therefore risk premiums. And because knowledge once gained is irreversible, so too are the lowered
risk premiums.
But while financial intermediation, through its impetus to diversification, can lower the risks of
holding claims on real assets, it cannot alter the more deep-seated uncertainties inherent in the
human evaluation process. There is little in our historical annals that suggests that human nature has
changed much over the generations. But, as I have noted previously, while time preference may
appear to be relatively stable over history, perceptions of risk and uncertainty, which couple with
time preference to create discount factors, obviously vary widely, as does liquidity preference, itself
a function of uncertainty. These uncertainties are an underlying source of risk that are too often
regarded as background noise and are generally not captured in our risk models.
I have previously called attention to changing risk perceptions as a risk-management challenge in a
different context when discussing the roots of the recent international financial crises. My focus has
been on the perils of risk management when periodic crises--characterized by sharply rising risk
premiums--undermine risk-management structures that fail to address them.
During a financial crisis, risk aversion rises dramatically, and deliberate trading strategies are
replaced by rising fear-induced disengagement from market activity. It is the general human
experience that when confronted with uncertainty, whether in financial markets or in any other
aspect of life, disengagement is the normal protective reaction. In markets that are net long, the most
general case, disengagement brings falling prices. In the more extreme manifestation, the inability or
unwillingness to differentiate among degrees of risk drives trading strategies to seek ever-more-liquid
instruments that presumably would permit investors immediately to reverse decisions at minimum
cost should that be required. As a consequence, even among riskless assets, such as U.S. Treasury
securities, liquidity premiums rise sharply as investors seek the heavily traded "on-the-run" issues--a
behavior that was so evident in the fall of 1998.
While we can readily describe the process of sharp reversals in confidence, to date economists have
been unable to anticipate it. Nevertheless, if episodic recurrences of ruptured confidence are integral
to the way our economy and our financial markets work now and in the future, the implications for
risk measurement and risk management are significant.
Probability distributions estimated largely, or exclusively, over cycles that do not include periods of
panic will underestimate the likelihood of extreme price movements because they fail to capture a
secondary peak associated with extreme negative outcomes. Furthermore, joint distributions
estimated over periods that do not include panics will underestimate correlations between asset
returns during panics. Under these circumstances, fear and hence disengagement on the part of
investors holding net long positions often lead to simultaneous declines in the values of private
obligations, as investors no longer materially differentiate among degrees of risk and liquidity, and to
increases in the values of riskless government securities. Consequently, the benefits of portfolio
diversification will tend to be overestimated when the rare panic periods are not taken into account.
The uncertainties inherent in valuations of assets and the potential for abrupt changes in perceptions
of those uncertainties clearly must be adjudged by risk managers at banks and other financial
intermediaries. At a minimum, risk managers need to stress test the assumptions underlying their
models and consider portfolio dynamics under a variety of alternative scenarios. The outcome of this
process may well be the recommendation to set aside somewhat higher contingency
resources--reserves or capital--to cover the losses that will inevitably emerge from time to time
when investors suffer a loss of confidence. These reserves will appear almost all the time to be a
suboptimal use of capital, but so do fire insurance premiums--until there is a fire.
More important, boards of directors, senior managers, and supervisory authorities of financial
institutions need to balance emphasis on risk models that essentially have only dimly perceived
sampling characteristics with emphasis on the skills, experience, and judgment of the people who
have to apply those models. Being able to judge which structural model best describes the forces
driving asset pricing in any particular period is itself priceless. To paraphrase my former colleague,
Jerry Corrigan, the advent of sophisticated risk models has not made people with gray hair, or none,
wholly obsolete.
More fundamentally, technology may be affecting the underlying economics of financial
intermediation. One of the profound effects of technology on financial services is that the increasing
availability of accurate and relevant real-time information, by reducing uncertainty, reduces the cost
of capital. That is to say, the cost of capital is lower for both lenders and borrowers and for banks in
their role as both. It is important to a bank as a borrower because funding costs are critically tied to
the perceived level of uncertainty surrounding the institution's condition. It is important in the role of
lender because a decline in uncertainty resulting from a substantial increase in real-time information
implies a reduction in what might be called "knowledge float"--the ability to maintain proprietary
information and earn a rate of return from that information with no cost. As you know, financial
intermediaries historically have been successful not only because they diversified to manage risk but
also because they possessed information that others did not have. This asymmetry of information
was capitalized at a fairly significant rate. But that advantage now is rapidly dissipating. We are
going to real-time systems, not only with transactions but with knowledge as well.
Financial institutions can respond to this disappearing advantage by endeavoring to preserve the old
way of doing business--by keeping information, especially adverse information, away from the
funders of their liabilities. But that, I submit, is a foolish policy that buys a dubious short-term gain
with a substantial long-term cost. Moreover, inevitably and increasingly it will become more difficult
to do. Whenever it becomes clear that the information coming out of an institution is somehow
questionable, that institution will pay an uncertainty premium. Conversely, when companies write off
errors, their stock prices almost invariably rise. The reason is the removal of uncertainty and the
elimination of a shadow on the company's credibility.
What does all this mean for financial supervision and regulation? If the supervisory system is to
remain effective in fostering the safety and soundness of the country's financial system, it must
adjust to the changing structure of that system. When wearing our supervisory hat at the Federal
Reserve, we and our sister agencies are always working to move in a manner that facilitates and
fosters innovation. We are in a dynamic system that requires not just us but our colleagues around
the world to adjust as well.
Today's financial products and rapidly changing structures of finance mean the old-fashioned,
nineteenth- and twentieth-century presumption that a month-old balance sheet is telling us all we
need to know about an institution's current condition is long since gone. Inevitably, therefore, we as
supervisors are recognizing this reality and have been placing greater emphasis on how well internal
risk models are functioning and whether the risk thus measured is being appropriately managed and
offset with reasonable hedges. We are also scrutinizing how well an institution is able to tie its risk
exposures to internal capital needs. We have a long way to go, but this is where competitive
pressures and the underlying economic forces are pushing both financial intermediaries and the
supervisory system.
There is a broader and more difficult problem of risk management that central bankers confront
every day, whether we explicitly acknowledge it or not: How much of the underlying risk in a
financial system should be shouldered by banks and other financial institutions. Clearly, were we to
require that bank risk-management systems, for example, provide capital to address all conceivable
risks that could bring failure, the rates of return on capital would fall, and the degree of financial
intermediation and leverage, as a consequence, would inevitably decline.
The degree of leverage in financial systems is obviously tied to the degree of risk at the margin of
lending. Before the creation of the Federal Reserve and, later, deposit insurance, banks were forced
by the marketplace to hold 20 percent and more of their assets as capital if they wanted to sell their
liabilities at minimum interest costs.
By its actions in the marketplace and its chosen governmental structure, society reveals its
preference for trading off leverage with its underlying risks and economic growth. Few, I presume,
would argue that zero leverage is optimum. Fewer would argue that zero leverage is consistent with
maximum growth. Yet the dangers of too much leverage are all too evident. In this context, how do
we central bankers and other supervisors read our very amorphous directive to maintain financial
stability and economic growth?
We have all chosen implicitly, if not in a more overt fashion, to set our capital and other reserve
standards for banks to guard against outcomes that exclude those once or twice in a century crises
that threaten the stability of our domestic and international financial systems.
I do not believe any central bank explicitly makes this calculation. But we have chosen capital
standards that by any stretch of the imagination cannot protect against all potential adverse loss
outcomes. There is implicit in this exercise the admission that, in certain episodes, problems at
commercial banks and other financial institutions, when their risk-management systems prove
inadequate, will be handled by central banks. At the same time, society on the whole should require
that we set this bar very high. Hundred-year floods come only once every hundred years. Financial
institutions should expect to look to the central bank only in extremely rare situations.
I am obviously referring to far more adverse outcomes than I was alluding to in my earlier remarks
on the need for private risk-management systems to adjust for crises in their estimates of risk
distributions. However, where that dividing line rests is an issue that has not yet been addressed by
the international banking community. Clearly, to choose the distribution of risk-bearing between
private finance and government is to choose the degree of moral hazard. I believe we recognize and
accept it. Indeed, making that choice may be the essence of central banking.
In summary, then, although information technology by its very nature has lowered risk, it has also
engendered a far more complex international financial system that will doubtless bedevil central
bankers and other financial regulators for decades to come. I am sure that nostalgia for the relative
automaticity of the gold standard will rise among those of us engaged to replace it.
For the benefit of others, allow me to explain that what you posted was Chairman Greenspan's concluding remark...the absolute final words out of his mouth at today's speech (before the Journal of Financial Services Research and the American Enterprise Institute Conference in Washington D.C.) Arguably, the final words uttered by someone leaves the strongest impression, agreed? This was no accident. Clearly Fed Chairman is himself a gold advocate, even concurrent with his employment mandate to preserve the integrity of the dollar currency. He chose to leave this thought ringing in his audiences ears..."I am sure that nostalgia for the relative automaticity of the gold standard will rise among those of us engaged to replace it." I would suggest that other gold minded individuals take advantage of the strong dollar while it yet lasts, while the Fed Chairman can yet hold it together with string and duct tape. Use your dollars while they remain strong to claim your stake in the ultimate monetary asset...gold.
Here are some words that Chairman Greenspan offered earlier in today's speech...essentially a rehash of his Jackson WY cautions last year:
"During a financial crisis, risk aversion rises dramatically, and deliberate trading strategies are replaced by rising fear-induced disengagement from market activity. It is the general human experience that when confronted with uncertainty, whether in financial markets or in any other aspect of life, disengagement is the normal protective reaction. In markets that are net long, the most general case, disengagement brings falling prices. In the more extreme manifestation, the inability or unwillingness to differentiate among degrees of risk drives trading strategies to seek ever-more-liquid instruments that presumably would permit investors immediately to reverse decisions at minimum cost should that be required. As a consequence, even among riskless assets, such as U.S. Treasury securities, liquidity premiums rise sharply as investors seek the heavily traded "on-the-run" issues--a behavior that was so evident in the fall of 1998.
While we can readily describe the process of sharp reversals in confidence, to date economists have been unable to anticipate it. Nevertheless, if episodic recurrences of ruptured confidence are integral to the way our economy and our financial markets work now and in the future, the implications for risk measurement and risk management are significant.
The uncertainties inherent in valuations of assets and the potential for abrupt changes in perceptions of those uncertainties clearly must be adjudged by risk managers at banks and other financial intermediaries. At a minimum, risk managers need to stress test the assumptions underlying their models and consider portfolio dynamics under a variety of alternative scenarios. The outcome of this process may well be the recommendation to set aside somewhat higher contingency resources--reserves or capital--to cover the losses that will inevitably emerge from time to time when investors suffer a loss of confidence. These reserves will appear almost all the time to be a suboptimal use of capital, but so do fire insurance premiums--until there is a fire."
Old Gold: Thanks, the bottom line: Psychology is Changing
It is categorically clear that the market psychology is changing.
There probably will be more days coming with huge upswings in the Dow and Nasdaq but the bull market gurus/technicians are already discredited and it is plainly clear for all to see. Not a one of them that I have followed forecast this kind of debacle. Corrections, yes! But not a true bear drop.
It is amusing to see many of them racing around, from internet forums to all variety of different media, trying to assert the correctness of their bull market perceptions in the hopes of protecting their losing positions. They are talking to themselves however, people are beginning to listen closely to the contrarians/pragmatists for the first time in ages. I have first hand evidence of that fact simply from the 10 to 12 phone calls I've received today from market bulls who've not talked to me in ages.
So all these events are enough to create a mass psychological shift. People will begin taking a second look at Mr. Clinton, their stocks, their money advisors, the state of America, the gold market, etc. My own hunch is that the Establishment is not inclined to see Mr. Gore run this country and the decision is already made to create the economic conditions to put Mr. Bush in power. Not surprising given how powerful his father used to be (and still is).
There is no turning back, not even if the stock market rises 500 points today or Monday.
Mass psychological shift, it's here, can't you feel it?
TORONTO (Reuters) - Shares of North American gold miners
proved to be the one bright spot in an otherwise stock depressed
market Friday as battered investors sought safety and comfort in
the yellow metal.
In midday trading, the Toronto Stock Exchange's heavyweight
gold and precious minerals index, home to some of North
America's largest gold mining companies, was up 278.02 points,
or 6.8 percent.
This came as the price for an ounce of gold in New York gained
$2 to $285.30.
The sudden interest in the gold sector came as the overall TSE
300 composite index was suffering its fifth straight day of drops.
At noon the index was down 279.31 points, or 3.1 percent, at
8684.00.
Inflationary worries sparked the selloff in North American stock
markets, prompting skittish investors to seek safety in gold and
gold stocks.
The U.S. Labor Department said Friday morning that its
consumer price index rose 0.7 percent in March, after a 0.5
percent increase in February, marking the largest increase since
April 1999. Excluding volatile food and energy prices, U.S.
consumer prices still rose 0.4 percent in March, their biggest jump
in more than five years.
March's overall gain in consumer prices was stronger than the 0.5
percent increase forecast by analysts. Economists also had
expected the core rate to rise by a more modest 0.2 percent.
The report said energy prices jumped 4.9 percent, driven by sharp
increases in the price of crude oil earlier this year. That was the
biggest jump in energy prices since a 6.0 percent gain in April of
last year.
The report raised new fears that the Federal Reserve would
boost interest rates more than previously forecast when it meets
again Washington on May 16.
And this forced investors, looking for safety in the choppy market,
to move to traditional safe havens.
"With very turbulent markets, people will turn to gold in times of
trouble," said John Lydall, a metals analyst at National Bank
Financial, in Toronto.
The cream of the crop of the North American producers were
the the beneficiaries, making them among the most actively
traded issues on the Toronto Stock Exchange.
"You've got a small group of what you would see as the quality
stocks and those are the ones to go for," Lydall said.
Barrick Gold Corp. , North America's second-largest gold
producer, jumped C$1.55 to C$24.95, Placer Dome Inc. was up
C$1.20 to C$12.65, and Franco-Nevada Mining Corp. was up
C$2.10 to C$20.35 on volume of two million shares.
On the New York Stock Exchange, Newmont Mining Corp.
North America's largest mining company, was up 1-9/16 to
22-7/8.
Analysts were not sure how long the love affair with gold would
last.
"It will be there until things settle out. The people will have to
assess if they honestly think gold prices are going to go up. If they
don't, then maybe they will start looking around at equities in other
sectors," said David Davidson, a mining analyst at Newcrest
Capital, in Toronto.
"For today, at least for variety, it seems to be the best place to
be."
Acting or operating in a manner essentially independent of external influence or control: an automatic light switch; a budget deficit that caused automatic spending cuts.
Self-regulating: an automatic washing machine.
Mr. G. means self-regulating. He also would appear to show there is an international effort to replace gold but points out that gold may not be such a bad thing: it self-regulates v regulators having to manage the new economy in an economy w/o gold.
>>>>>>My own hunch is that the Establishment is not inclined to see Mr. Gore run this
country and the decision is already made to create the economic conditions to put Mr. Bush in
power. Not surprising given how powerful his father used to be (and still is). <<<<<
That may be the explanation for the absence of a PPT rescue action at this juncture. "Who Benefits?" is the one better tool than "Follow the Money."
Hello? Hello? Come in...Anyone out there? This is Ham operator XAU...Can anyone hear me? IronHead?...Trail Guide?
I think the cylone just crossed the Bond county line after decimating DOW NASDAQ and S&P counties...This baby's a Hum-dinger! I think we have an F9 on our hands. Now its heading for the Utility sector...This may be my last transmission 'til I get the generator cranked up...Too noisy and stinky to use here in the storm cellar. May God Help us all!!! I'll fire up the geneartor when this thing blows through and we'll take inventory on whats left to salvage. All for now XAU over and out!
I note a lot of disillusionment about gold performance today. It is not surprising but nothing happens overnight.
The conditions are being created for mass psychological shift in the markets. But the powerful opponents of gold as a financial reserve asset remain ensconced in their offices, continuing to slam it as best as they can whenever they can.
Today presents a rare positive condition for gold: Nasdaq DOWN, Dow DOWN, Bonds DOWN, and yes, finally, the US Dollar DOWN. All conditions in place for a flight to gold because quite simply there is nowhere else to put money (unless you flee to foreign markets, which themselves are fairly unstable lately).
I read Leonard Kaplan (LFG bullion) speaking negatively about gold on KITCO (any surprise?), saying once again that a fall in stock market equities is not good for gold since there will be less jewelry purchases.
Well, actually, the key to gold's strong upward movement does not lie with the jewelry market, it lies with the Western central banks.
We already know that Eastern central banks remain net purchasers of gold whereas Western Central banks have been disposing of their gold, either through direct gold sales or the backdoor avenue of gold leasing.
So there is only one compelling reason why Western Central Banks would cease sales of gold or even revive purchases: a new perception that the US dollar and financial markets are NOT invulnerable PLUS the recognition that if the US Dollar might become a much weaker entity someday, then it is in Western Central Banks best interests to ensure they own a medium of exchange that will be valued by those Eastern Central Banks that might one day repudiate US dollar exchanges for any number of reasons.
In other words, if the Western financial rationale for owning gold changes from its current negative perception into a positive perception, then changes in Western Central Bank gold policies, in the form of either gold loan terminations or gold purchases, would surely overwhelm any kind of populist jewelry sales stagnation or collapses.
April 15 is the deadline in the U.S. for filing and paying taxes owed for 1999:
What if: 1/3 of the taxpayers filed for extensions because they didn't have the money to pay what they owed in taxes?
What if: 1/3 of the taxpayers refused to file a tax return for 1999?
What if: The huge sell off in stocks today and recently is because Taxes are due on all that profitable trading done last year and some traders(taxpayers) didn't have the cash available to pay taxes unless they sold stock at any price?
What if: The Plunge Protection Team didn't have enough cash on hand because of an unexpected shortfall in taxes collected?
Aristotle (04/13/00; 19:46:15MDT - Msg ID:28571)
>>>>Fantastic stuff, Peter! If this post (Peter Asher (04/13/00; 12:59:10MDT - Msg ID:28562)) doesn't find its way into the Hall of Fame, then nothing will. Great stuff, beginning to end. Three others are hereby sought to voice similar approval.<<<<<
You appreciation and understanding is heartily welcome.
canamami (4/14/2000; 10:24:04MDT - Msg ID:28614)
>>>>>The Question Is....
where is the money that is fleeing the equities markets going, presently and in the future?<<<<
From yesterday's post: --->>>The effect of a market crash would certainly be first and foremost a
decline in spending. The "Wealth Factor", which is nothing more than an expectation of future stock
sales being paid for by money being �saved' out of future earnings, would be devastated. If stock
market sentiment were to decline, then the spending decisions would swing back to the income
earners. In that environment, would there be more homes and new cars bought, more businesses
started or expanded, or more money saved? (The latter allocation, of course, would result in the banks expanding the money supply and then issuing loans for consumption or capitalization.) However, if there wasn't a demand for new loans due to a crash in consumer confidence, then that money would exit the Money Supply.<<<
So to continue on that; The categories of "Money fleeing the equity market could be listed as 1) Cash received for stock sold, 2) cash available newly for investment under the investors control, and 3) $401-K and similar funds that are limited to specific areas of investment. Fear will drive funds into savings, but some optimists (Fools?)will "Bottom fish." Aggressive investors might move into hard assets, or they might stay cash liquid until they see which way the �Flation wind is blowing. Big question is where will the ongoing 401-K funds flow? (While they still are forthcoming)
Most certainly, those business that have thrived on "EasyMoney" are going to take a hit. The mystery is what will be the "Ripple Effect" of that. Like the Porsche dealer decides not to renovate the kitchen using the builder who now decides not to buy the new truck from the Ford dealer who now decides not to go to the seashore for vacation, etc. etc.
The pendulum swing will be between fear of loss and desire for gain. Johnny-Trader and Joe-Six- Pac have been conditioned to expect purchasing power to be acquired partly (Or totally) by non- productively income. This is where the rude awakening will cause the greatest shift in the economic picture.
For several decades now, the true producers of the country have been on the short end of the work- reward stick. They have been mollified by the "Soma" of easy credit and easy gain, enabling them purchasing power of a greater magnitude than their wages and salaries would provide. When this drug is no longer available there will be a massive debt and default hangover.
Our group here know that it's a no-brainer to put liquid assets into Gold at this point. Protection is senior to profit in a crises and the profit potential is certainly there also.
DOW: -616.23
NASDAQ -356.76
It appears as if the PPT saved their ammunition for capping gold and silver today. Of course, the other markets could simply have gotten away from them....
Imagine what would have been the case with accurate CPI figures. Hmmmmm.
I'll second Sir Aristotle on Peter Ashers 28562 post into the HOF, and at the same time nominate Aristotles 28571 post for The USAGOLD Hall of Fame....We need three seconds....beesting.
The call volume on MSFT is still very high relative to puts. However, near term put open interest is rather high.
Only today has the VIX shown any signs of deeper distress, hitting the 40% point.
I expect the PPT to enter the fray next Tuesday in order to get the market out of the dip towards the Friday expiration.
Today's sell off was driven and maintained by the SP futures.
There is heavy buying beneath the market.
I reduced my tech short further. I expect a rebound, which I will use to reestablish shorts. If the rebound does not happen, I will continue the ride down. I don't expect to start sniffing for bargains till the end of April, early May.
A nice gold rise today. I expect the bulk of gold buying to occur AFTER the stock market bottoms.
Go gold.....
(This is not a crash, this is not a crash, this is not a crash.... - there, I almost convenced myself. See the power of positive thinking? If stock prices can be up without earnings, than surely I can see them as valuable without high prices either...)
Here Comes the Anti-gold Blitz...Let's sit Back...Enjoy
Still laughing at the last paragraph.
************************************************************
Updated 2:30 PM ET April 14, 2000
By Alden Bentley
NEW YORK (Reuters) - Gold rose halfheartedly on Friday's
U.S. inflation and stock market jolts, a disappointing and
possibly defining moment for the metal that in its heyday had
been a preferred destination for investors panicked about
preserving their wealth.
"The safe-haven issue has been thoroughly disproved this
morning," asserted Leonard Kaplan, chief dealer at LFG
Bullion Services in Chicago. "While there still remain a few
who seek it as a safe haven, those numbers are dying quickly
and today is the perfect example."
Until recent years, bullion was sought to protect porfolios and
national currencies against erosion by inflation. And grabbing
gold was a no-brainer when stock markets were plunging.
But on Friday, the once-treasured metal was unable to hold
much of its knee-jerk rally after the U.S. Labor Department
reported a higher-than-expected 0.7 percent rise in March
consumer prices, the biggest jump in a year.
"Had you asked even the most ardent gold bug what
conditions would create a bull market, the two most common
they would say would be a collapse in the stock market and a
rise in inflation rates," Kaplan said. "Today we have a
confluence of both of those factors. The bottom line is gold is
an industrial metal -- period."
At 1410 EDT, active June gold futures on COMEX was up
$2.10 at $285.30 an ounce, well below its $288.50 morning
peak. Spot bullion fetched $282.70/3.70, having topped at
$286.
Especially vexing for every market but gold was the 0.4
percent jump in the core inflation rate, which excludes volatile
food and energy prices.
This was the biggest in five years, upping the pressure on the
Federal Reserve to raise interest rates more aggressively, and
sending the tech-heavy Nasdaq reeling another 7 percent and
the Dow industrials down 3.5 percent by midday.
Preventing the restoration of gold's past glory, most analysts
believe, is the impression that the Fed is ahead of inflation
after raising rates five times since last June.
Policy makers next meet on May 16, when many expect the
fed funds target lending rate for overnight loans between
banks to be raised 50 basis points from 6.00 percent.
Until recently inflation has been dormant, leading to the
so-called "demonitization" of gold, and a drop in its price to
20-year lows last August.
Major central banks began openly lightening their holdings of
low-yielding bullion in the late 1990s, rebalancing reserves to
get better returns from paper assets denominated in hard
currencies like the dollar, euro and yen.
With its status as a monetary asset downgraded, gold was
said to have become more of a lowly commercial commodity.
Industrial demand mainly originates from the jewelry- and
trinket-consuming centers of India, the world's biggest buyer,
Asia and the Middle East. Physical demand from these
quarters ran at record levels last year helping underpin the
market.
But platinum is the hot jewelry fad at the moment. Besides,
jewelry demand, in the U.S. at least, hinges on disposable
income, raising the troubling possibility that Wall Street's
bearish mood eliminates conspicuous consumption of bullion.
There are also many alternatives to parking hot monies in
gold. Nearly all other paper assets could beat the near-zero
percent returns that make the yellow metal more attractive to
borrow and short by selling forward than to own.
"I'm more inclined to think that there will just be movement of
capital in between new economy and old economy stocks,
between equities and fixed income and between our financial
markets and financial markets outside the U.S. -- more than a
dramatic movement of capital into say gold," said David
Rinehimer, head of commodities research at Salomon Smith
Barney.
"It doesn't seem like you are going to get much bang for the
buck in the gold market right now. Particularly with the central
bank selling that's going to occur over the next two to three
years," he said.
But many expect gold to slowly grind higher if stocks keep
tumbling, even though a return to the highs hit last October
after European central banks agreed to limitations on gold
sales is seen unlikely to happen soon, if at all, they said.
Also, shares of North American gold mining companies
proved to be one of the few bright spots in Friday's stock
market fiasco. The XAU gold and silver mining index on the
Philadelphia Stock Exchange was up 4.25 percent mid
afternoon.
"This flight to quality, while it exists, is really at margins," said
Refco Inc precious metals analyst Marshall Steeves.
"I would not expect to see another repetition of what we saw
last September," he said. "Maybe we could get into the $290s
but we would have to see a precipitous (stock) fall to get
back up to $300 at this point."
**I watch the final bell as the markets closed and then the final numbers on the TV today as I'm sure many did. I saw something I've never seen before. Three or four times the futures price of the June contract of Gold was displayed among the postings of the final DOW, NAS, and S+P figures. This on the same day that A.G. mentions the gold standard! I believe the wind direction has changed but is more needed to free POG?
One of the news sites I belong to sent me a copy of a post today which was entitled "Emergency Financial
Warning". It was written by Dr. Rod Lewis who gave this website address. I in turn presented some of the
facts in that post before a financial forum I belong to and they brought up some excellent questions about
the validity of information in the post. If Dr. Lewis could answer these questions, I (we) would be most
grateful.
1) Do you have any proof that on 4/4/2000 @ 12:40 Eastern Time, the Financial markets came to a halt?
According to the NYSE half-hour volume table in this week's Barron's, trading volume between 12:30 and
1:00pm was 118,46 million shares -- more than double the average for that trading interval.
2) Your statement that the market was injected with 3 Trillion dollars in liquidity seems totally unrealistic. It took
the markets months to incorporate 200 billion into them, how could they absorb 3 Trillion in less than an
hour? Also, it is my understanding that the largest pool of liquidity exists in the Japanese Postal Service...yet
that doesn't even come close to 3 Trillion. Do you have any way of explaining this?
3) Exactly were could this 3 Trillion have come from? Even if you add up the ESF, call in favors from Saudi
Princes and get the boys at Goldman and Merrrill together, I suspect they would come up far short of this
enormous sum.
Thanks,
Meg-abear
Author: RJ Lewis (p194.amax19.dialup.hou1.flash.net)
Date: 04-12-2000 23:12
1. I can send you the tick by tick graph and price prints of that day. A picture is worth a thousand words. The
NASDAQ was down over 700 points intraday - something went wrong with the system when a huge amount
of liquidity in the form of derivatives contracts were purchased. Based on the move the market made (over
700 points back up in less than an hour) tells me that it had to be on the order of $300B in 'currency', which
translates into 3 trillion in derivatives obligations.
2. What do you mean 'where did the money come from.' They are electronic accounting entries that the FED
can add to the system in an instant. Money is not real anymore. There is only about 500B in currency the rest
is nothing but electronic bookkeeping entries. The global amount of dollars in demand deposits is about 21
trillion if you count the Eurodollar market (not to be confused with the Euro or EC Unit.)
3. The problem is everyone is willing to accept the fact that a company like Linux VA can go from a 21M dollar
capitalization to over 3B in one day, but they cannot believe 'all that money could have come from nowhere.'
The problem is, my friend, that nobody understand what money IS anymore.
4. You ask some good questions but I detect a bit of financial naivet� in your post. I admit that I am speculating on what actually happened, because there is no historical precident for it. The fact of the matter is that the post Bretton Woods financial system is crumbling before our eyes. It will take no less than a miracle or some financial alchemy to save it.
http://www.nara.gov/fedreg/eos/e12631.htmlThe link above appears to be the executive order envoked to set up the "working group on financial markets" aka Plunge Protection Team directly after the 1987 market crash. This has probably been posted a long time ago by ORO, but just in case, here it is again!
True, they haven't expired yet. My concern about the Microsoft options is due to the amount of puts Microsoft has written as part of the "ESOP-sell puts for earnings" scam. Selling puts is great when the stock price is rising, but it blows up when they all go "in the money". Do they have enough "real" earnings to cover the losses on the puts they have written? Have they hedged?
I suppose we won't know the details until the next earnings (or loss) statement. It is the loss from the puts that will reinforce the slide in the stock price. A positive feedback loop.
"The safe-haven issue has been thoroughly disproved this
morning," asserted Leonard Kaplan, chief dealer at LFG
Bullion Services in Chicago. "While there still remain a few
who seek it as a safe haven, those numbers are dying quickly
and today is the perfect example."
-----
Wow, just the other day he claimed to be a "gold bull" over at Kitco, conjecturing that gold might limp its way to 320 by the Fall.
Hmmmm, the above paragraph does not read like very bullish comments about gold. Rather, a super-bearish attack on the metal if you ask me. I would expect he continues to hold a huge physical metal short position since that is a hard thing to close without moving the price through the roof.
Meanwhile this man's been the chief champion and promoter of internet stocks and momentum investing on these metals forums, relentlessly urging everybody to surf the wave (did you see VENGF/Itemus's price today? Ninety three cents, down 85% from its recent high). You can just imagine how his Nasdaq stocks must be doing.
In the end analysis, the man is certainly entitled to his opinion and it is not inconceivable he might be right. But it is very important to hold up hypocrisy to the light of day and shine the truth upon it.
Seems there are TWO Leonard Kaplans - one bullish and one bearish -- two totally different, unrelated people.
Go to the bullish Kaplan's site and read the bold print (newly added pieces for today). He states in parenthesis that the bearish bullion trader Leonard Kaplan is no relation to himself.
Recall ORO's post (in HOF) about the movie Matrix as a certain scene related to the concept of modern money? Didn't it go something like this...." it doesn't exist (the spoon)...it never existed"?
Many here would agree that Bretton Woods is breaking down. I think AG would agree.
Correction: Conditions for gold upspike NOT met today
Close but no cigar. Still gold and gold stocks moved upward and that is encouraging and supports the fact that it will be the best performing sector during the coming Crash.
Please note that in an earlier post, I noted that gold experienced conditions required for a sharp upspike.
However, at the time I posted, bonds had been falling but they sharply reversed and closed UP for the day, though not too strongly. It appears that the Establishment determined that if they were going to allow the stock markets to tumble, they best arrest the fall in the bond market. They did so successfully and, in doing so, contained the flight to gold. FALLING bonds are an essential ingredient required for a new gold bull.
When the Dow is FALLING, the Nasdaq is FALLING, the Bonds are FALLING, and the US Dollar is FALLING, then there can be no other flight to safety except gold. That is incontrovertible fact.
Date: Fri Apr 14 2000 15:17
uptick (to farfel (wherever you may be)) ID#277249:
sir, I am not a basher nor a gold bear...just a trader....I comment and report on the facts and the actualities of current trends...I do not pin my
hopes on unrealistic hopes and fears...
as a trader, my opinion can and does change rapidly due to market conditions...I hold no opinion long term....
but if we must depend on the western central banks reversing their attitude on gold, the gold market is in trouble indeed
I missed this quote, this one is priceless coming from a self-proclaimed "gold bull." Again, my intention is not to ridicule Mr. Kaplan, merely shine light upon categorical hypocrisy.
-----------------------------
From Leonard Kaplan:
"Had you asked even the most ardent gold bug what conditions would create a
bull market, the two most common they would say would be a collapse in the
stock market and a rise in inflation rates," Kaplan said. "Today we have a
confluence of both of those factors. The bottom line is gold is an industrial
metal -- period."
------------------------
Actually, Mr. Kaplan, any knowledgeable informed gold bull would respond that there are THREE imperative conditions to a gold bull, and none of those conditions need necessarily have anything to do with inflation or money supply for that matter.
That is why Mr. JP at Kitco is so correct in stating that, even during a severe deflation, gold can (and likely will) go through the roof.
Once again, Mr. Kaplan, the conditions are of an a priori nature and they are as follows:
Simultaneously FALLING stock markets (including both Dow and Nasdaq stocks), FALLING Bonds, and FALLING US Dollar.
In such a scenario, there can be no other safety haven except gold. No other place to put money, unless you wish to go offshore, and then only if you can find a country whose own fiat paper and markets are not experiencing havoc as a result of US currency and market turmoil.
Today, those THREE conditions were not met, since bonds experienced some kind of intervention and a limp rally at the end of the day. But a rally nonetheless.
A quote from some trader in PH in LA's last post:
"but if we must depend on the western central banks reversing their attitude on gold, the gold market is in trouble indeed"
The western central banks and the governments will try to hold down gold as long as possible. The pretense of valuable paper assets, central planning, and low worth commodity gold depends on the manipulation. Sometime soon a derivative dam will break. When the dam breaks, $100 - $200 - $1000 gold days will come just as Another/FOA said.
To Gold-Eagle:
NYSE, NASDAQ & GOLD-EAGLE ALL AT RECORD TRAFFIC
(vronsky)
Apr 14, 17:04
While the NYSE and NASDAQ experienced record volume
trading today, so GOLD-EAGLE "suffered" record smashing
traffic.
Just before GOLD-EAGLE was forced to shut-down for 50
minutes, the access rate was running at greater than
9 million monthly hits. Our systems were overwhelmed by
extreme excess volume.
A long weekend of soul searching lies ahead for many American investors
With the Nasdaq Composite giving up 35% of its apparent street value from its highs of one month ago, I can't help but think that many people will find themselves thinking thoughts that they've never thought before. "What is the true meaning of wealth? I thought I was rich, destined for early retirement, but now I have lost one-third of my money."
Sorry Charlie. But truth be told, you lost your "money" (currency, to be more accurate) the day you gave it to somebody else (spent it) in exchange for an infinitesimal partial ownership of a corporation that doesn't even know you exist, or for an equally minute stake in similar assets under management via a mutual fund.
As these people try to come to grips with what went wrong, the more astute among them will hopefully attain a more fundamental understanding of the proper role of corporate investment for their personal existence and well being. More specifically, that Yesterday's stock valuations are no guarantee of Tomorrow's personal wealth. It shouldn't be too terribly difficult for them to realize that their share of market capitalization is not necessarily a suitable form of Savings--at the very least, they will admit that it certainly can't be confused as the equivalent of a cash savings account, for better or for worse. They are now learning the harsh realities on the downside. (The joyous upside isn't such a good teacher because noobody looks a gift horse in the mouth.)
The easy lesson that shows their savings or checking account to be intact while their stock portfolio has been decimated (or far beyond that) will bring a brighter glow of awareness to even the dimmest bulb that stock accounts cannot be equated with cash accounts.
Those very few who think about these matters deeper during their weekend of quiet, humbled introspection may ponder over matters to the next natural level of questioning. After the realization that investing in stocks must be very prudently done (because it puts at risk your currency that otherwise would be "safe" in an account,) the next point of musing will be with regard to their attitude toward the notion of having any significant portion of their accumulated "net worth" sitting quietly in a simple bank account.
Only children do this. (I can still remember when my own parents gathered me and my two sisters into the backseat of the family car, along with three little piggy banks each being clutched by the tiny hands of its owner, to be driven down to the bank to open our very first (and last) passbook savings account.
Considering the low (still negative?) rate of savings among Americans, it supports this hypothesis that most Americans have intuitively come to the understanding that currency in an account is not an acceptible end unto itself, and perhaps not even a suitable means to an end. It is much more preferable to have the real things that this currency can buy than to have the currency itself. These real things run the spectrum from turbo-charged riding lawnmowers with power steering and dual overhead cams, to no-fat double decaf lattes at the corner cappuccino parlor. Even the stocks that are currently biting them are representations of real things--so obviously, not all real things serve the same purpose, nor do they always serve you in the way you'd prefer. Have you ever purchased an item of food for the purpose of nourishment (or enjoyment) only to be made very sick by it? Very much akin to the experience of those having financial exposure to the Nasdaq this week, I'm sure!
If the psyche of the American investor won't allow for currency to sit idle in a bank account for any period of time, and if the game of "hot potato" with currency and stock certificates passed back and forth through the stock exchange has been brought to a more sober reality, then what channels will receive the attention of those with "net worth" in need of real expression?
Where will they turn? You came to Gold (evidenced by the fact that you are reading this forum) early on because you are "smarter than your average bear." Others will follow. They simply have only to think things through more carefully than they have had reason to in the recent past.
Parsing Mr. Leonard Kaplan (LFG Bullion), Gold Bear
Date: Fri Apr 14 2000 15:17
uptick (to farfel (wherever you may be)) ID#277249:
sir, I am not a basher nor a gold bear...
(So when you told the media today that gold has proven itself to be no more than an industrial metal, we should not construe that to be "bashing" nor the standard anti-gold rhetoric of a ideological gold bear??)
just a trader....I comment and report on the facts and the actualities of current
trends...I do not pin my
hopes on unrealistic hopes and fears...
(Yet, as somebody who has championed and extolled the merits of Nasdaq internet bubble stocks...who has urged us to get on the bandwagon of momentum investing...I would imagine you are still invested in many of these New Era darlings since, even if you were stopped out, you probably got suckered into buying the dips that never ceased dipping. Furthermore I would imagine that many of your momentum investments are well underwater after today. So is it safe to say that
right now, you are pinning your hopes on the theory that the Nasdaq will snap back?? Is it possible that you are pinning your hopes upon an unrealistic dream? That even with your famously beloved "stops," you conceivably could wake up on Monday to a market lined up with sellers who want their money back? Desperate mutual funds investors who force so much sell pressure on the market that stocks must be delayed in opening, then opened up at a mere fraction of their previous closes such that all your beloved Nasdaq stops are bypassed completely? Is that not impossible? Maybe YOU are the one pinning your hopes on unrealistic dreams, namely a normal market opening on Monday?)
as a trader, my opinion can and does change rapidly due to market conditions...I hold no opinion long term....
(You say that, yet if I were to litanize your evaluations of gold this past year alone, then I must determine that your bias is decidedly negative. You view goldbug-ism as some kind of deadly enemy ideology whose acceptance by the masses threatens the lofty valuations of your precious Nasdaq stocks and momentum investing techniques)
but if we must depend on the western central banks reversing their attitude on gold, the gold market is in trouble
indeed
(well, conversely, if we must depend upon the mass insanity of the average Nasdaq investor/bubble Dow investor continuing ad infinitum then I would say the stock market is in trouble indeed, sir.
I do agree with you that the Western Central Banks will NOT voluntarily change their dismal attitudes toward gold without some external circumstance pressuring them to do so. Again, I believe that any notable weakness in the US Dollar or US financial markets will be sufficient to cause concern amongst Eastern Central Banks, even possible repudiations of US Dollar transactions, given the size of the astronomical US trade deficit. If such a day arises, then these Eastern countries might force transactions in gold or some equivalent.
Essentially, given the deteriorating macro conditions in America (most notably exploding money supply and exploding trade deficit), then I do not see the US Dollar maintaining its surrogate gold status for much longer. At some point, some country will probably repudiate the status quo, and with a plunging US Dollar, the flight to gold will be breathtaking).
Shock-but no panic yet.
Short term worst case scenario: Markets re-open and rally ensues. Rally fails. This particular inter-day reversal will set off severe, major, no kidding around sell-off.
My gold and silver bullion are buried out on property and resting comfortably. A true calming balm that soothes an imagination looking out to a possible catastrophe of Biblical proportions.
Just wondering -- what percentage of Americans really are finding themselves financially exposed by margin calls this weekend? I can't help but wonder what kinds of conversations and emotions are going on in the houses I pass by around town. We live in northern Virginia, in dot.com country east.
Transmitting from Ham operator XAU. Not so bad so far the cyclone has left the ground and is just hovering overhaed. meteorologists predict re-touchdown @ Monday AM possibly NZ time. Are you battened down Zenidea? We ain't seen nothin' yet...When she goes she's gone! Predict DOW atmospheric pressure below the cone of the cyclone to hit a 3750 level before she's done. Station XAU Over & out !
Here's how some famous billionaires fared as the stock market
plunged this week.
LOSERS
William H. Gates III, chairman and chief software architect,
Microsoft Corp. (NasdaqNM:MSFT - news), lost $1.10 billion
on his 741 .7 million shares of the company.
Charles R. Schwab, chairman
and co-CEO of Charles Schwab
Corp. (NYSE:SCH - news), lost
$258.4 million on his 175.2
million shares.
Jeffrey P. Bezos, chairman and CEO of Amazon.com, lost
$243.1 million on his 117.5 million shares.
Michael S. Dell, Chairman and CEO, Dell Computer
Corporation (NasdaqNM:DELL - news) lost $231.5 million on
his 305.1 million shares.
Jerry Yang, Chief Yahoo! of Yahoo!, lost $159.4 million on his
45.4 million shares.
Stephen M. Case, chairman and CEO of America Online, lost
$122.4 million on his 8.90 million shares.
Winner
Warren Buffett, chairman and CEO of Berkshire Hathaway,
gained $570.0 million on his 474,998 shares.
Here's hoping that you find a moment to update us on your position in the wilderness that unfolds at this historic moment. Are you "on the trail"? Do this weeks events in the stock market averages affect the "view" from there?
Take Note Trail Guide (for your reading pleasure)I spoke briefly this afternoon with the only other PM broker I know of in the whole world besides MK at CPM. Guess what? Many of this fellow's customers' were selling gold "because it wasn't doing anything" to buy stocks. Don't be surprised. My brother-in-law called tonight; he's a pretty successful investor over the last 15 years. I tried to engage him in a discussion of gold in portfolio as a prudent diversification strategy. He'd have none of it. He is waiting for stocks to go much lower and then buy in. I do believe he has a good argument. Fortunes were made after '29 this way.
My point is that the very best argument for gold ownership is a monetary one. This humble opinion is of course eclipsed by TG/FOA's commentary on subject. We live in a paper world here in the west. Only a scenario such as described by our TG/FOA would change all that. Are you a betting man/woman? Think hard on that!
Lest we forget, Stranger's rationale is still quite compelling in light of the information released today.
Tune out all the static. Switch to the PM dial. Gold's the deal of a liftime at these prices.
**Shifty, thanks for the Ponzi number. As I watched CNBC today I found myself calculating them. There was a point, around 3:40 or so when Ponzi was -550.
**Mr. LeLand, the only winner on your list is the same fellow who bought 129,000,000 ounces of silver during the latter half of 1997 and was then smart enough to take the physical and move it to London where he could give it some privacy. Does anyone know for sure if it has been sold or leased? Mr. Buffet has always claimed to be a "buy and hold" type guy. He'll survive what's coming and do well afterwards is my guess. Can't afford even one share of his company!
Today may signal the beginning of a long hard lesson for many of our friends. I'm am truly sorry for the losses they may soon incur. Dreams are the things that keep many good people going through the rough times. But now, the dreams may shatter just as the rough times begin. It's been nothing but blue sky and sunshine. But, I have hated it! No, I'm not a kill joy. I just loath untruth. It always leads to pain. We are probably the most deluded generation that has ever walked the planet. The delusion goes much farther than the markets. Our god is technology. But, who among us has never been burned by it?
Yes, the Plunge Protection Team will probably trot out next week and start buying index futures like every time in the past. The talking heads will chant "invest for the long haul." Investors may come again to slake their thirst at the trough. But it is only a matter of time. The next rout will be worse than the last, until the majority of investors lose their taste for risk.
I'll tell you a little secret. The important things are ALWAYS simple. And the simple things are always HARD. The trick to life, if there is one, is to learn to do the hard thing.
I'll give you an example. Has it been easy to buy GOLD and pass on stocks while the current mania has gained momentum? There are all kinds of interesting strategies and lots of neat terminology. Some televison commercials are aimed at making you feel like your not a "smart investor" of you don't know all the buzz words. Complicated software packages, investment seminars, technical analysis, this is all very interesting. But, it'a all designed to get you to take your "eye off of the ball". We have developed an "investing culture", we follow a wothless stock as though it were a game of fantasy football. It's very complicated, you see. And of course the underlying accusation is that if you don't understand the subtile nuances of these meaningless statistics, you are missing the boat and will never retire rich. Well here's a SIMPLE fact to mull over. By definition, only a few can be rich at any one time! Inflation guarantees that everyone cannot have excess monies. Prices would skyrocket, confiscating most peoples wealth. So then, just how the hell is EVERYBODY going to retire rich? Yet this is the very assumption our current society is based upon. The SIMPLE keys to retirement at any level are capital preservation and debt avoidance. What makes it HARD is the government-investing-banking triad that makes its living seperating you from your capital and placing you under the indenture of debt. Just like that, no software required.
The very fact that gold continues to hold such a tight trading range ($285-295) while the rest of the world goes on a roller coaster ride, is the strongest proof that in the minds of those in the know, gold still represents the ultimate monetary anchor in a chaotic world. Since the dollar has basically taken the role as a worldwide Goldersatz, is it not in the "best interests" of worldwide financial stability to have gold and dollar held closely in tandem??? Does not the use of ESF and bullion bank funds to "lock the dollar into a tight trading range against gold" create a defacto "gold standard" for all dollar denominated contracts???
A phrase emerged in my mind tonight at dinner...just popped in out of the blue..."willing counterparties". It seems to me that the whole industry of derivatives is based on the idea that one is always able to identify "willing counterparties" who are willing to take the opposite side of a risk....well...could it now be that some of those rules don't work anymore...like somefolks are becoming the "counterparties of last resort"???
How much more chaos would there be in the world if the the dollar decoupled from gold (in either direction)?
We all know that margin debt in the stock market is at an all time high but it is still only about 4% of total stock value...(obviously there are the other forms of debt which could be deleveraged over a longer period). On the contrary side, in the paper gold markets, margin is probably 75-90% of the open interest. Here is a problem....it is considered prudent to buy a share of a company, pay 100%, and leave the ownership of the share coupon with a broker (for ease of title transfer upon sale). But to do the same in the gold market (pay 100% for a paper claim to a unit of real gold) is considered very abnormal. The COMEX and LBMA are gold "traders" markets, not "gold owners" markets...whereas the stock market still remains at all times a "stockowners" market. So in the gold paper market, serious leverage both long and short is the norm.
So how can someone who has been a stock owner (like a large multibillion dollar mutual fund) place funds "for safety" into a gold market which is not based on gold ownership but rather on gold trading? There is no way that the current structure of the paper gold market can attract in substantial "parking places for capital". How can a gold market which is 10% gold, and 90% margin debt be considered a "liquidity haven"??
But isn't that the historical role of gold, as a liquidity haven?
I do not believe that the gold market can explode in the upward direction until there is once again a solid basis for real ownership....such that mainstream investors can seriously have the opportunity to hold 10% of their net worth in gold (PMs)....and for most people this means a reliable gold proxy (proven ownership coupons)...not something buried in their garden.
The players in today's paper gold markets are traders...the rules are built to facilitate trading...not ownership. There is no such thing as a buy and hold trader...and buy and hold gold investors have taken delivery long ago.
The dollar price of gold (POG) is a good barometer of the "will to control" and "balance sheet strength" of the large gold trading counterparties. In the current stock market meltdown, credit tightening, bond inversion era...any loss of control in the paper POG is surely a sign of severe international financial turmoil...and folks, even gold bugs will suffer if the big cross cascading defaults come.
As Sir Bonedaddy implies, "Keep your eye on the ball"
http://www.austrian-mint.com/Bilder/Gold/goldgr.gifHere is "the ball"...most people will fail to "catch" it at such favorable exchange rates, yet you can be sure the masses will desperately seek it out when it attains much higher prices.
http://www.usagold.comAs I see it this is the rock that fell off the mountain that collides with the other loose rocks (leveraged unsecure debt in all forms) that begin to tumble down to eventually start an avalanche of debt implosion. The support efforts of the Fed to provide liquidity are inflationary. In an election year........you can weigh out who does what. The Fed cannot just "buy all the stock" and support it all, not even slightly. So the foreign dollar owners are wringing their hands waiting to buy America cheap. I think they will wait along time to invest so all this winds down for 6-8 months in a recession turning to a world recession. The bubble shown in the DOW is still huge taken from the 10 yr chart that no one wants to see. The DOW has a long way to go down.
As these other bubbles get exposed it will lead foreign analysts to downgrade the whole US as far as investment security. When foreign money stops flowing in, the Fed will stop redeaming debt and start issuing it. Then the dollar falls and gold sustains it's price rises. So as Britain lost its empire after the US pulled out of its depression in '29. So the US looses its ability to police the world and give gifts to foriegn dictators to keep them on our side, as Japan pulls out of its depression. This isn't all going to happen tomarrow but it is in the process of happening.
As the equities bubble pops it first exposes the derivatives bubble, then the consumer debt bubble, and then the Real Estate bubble. The consumer debt bubble will lead to extreme weakness in REITs and eventually runs on weak banks. Long Term Capital type failures will probably surface from the derivatives blow up and those bailouts can trigger the big one. It is always some shocking news story that triggers it not just heavy selling. Distress selling below Oct. price levels can stress the system beyond what it can bare. Personally, I think the Nasdaq is going down a little more and then it is headed sideways for a month building a shoulder but its angled down not up (distress selling due to mutual fund redemptions). Insider selling should cap any rally attempts. The DOW is retracing way below Oct. because no one really wants to invest in it. With the talk about recession looming, all the trust and hope in the DOW becomes like soda fizz. Don't give up on gold yet, we have like 4 more bubbles to go. Each one is going to stress out the system. Bill and AG have a few basic choices; borrow, inflate, or raise taxes...... to provide liquidity banks will need. They probably will do all three. Budget surplus just turned into nothing next year as people gain billions in capital losses to carry over into 2001. If you are so oriented to invest in stocks as it's "all I ever knew" well then learn how to short so you have some cash for gold after the meltdown really hits. Whatever percentage you would normally be long you should be going short. Don't even ask a broker about shorting stock, it's like smoke in their eyes. You need to use your own head. Wait for the reprieve rally and short at the top. You never short when it is comfortable. Throw three darts at the NYSE and you will probably be fine. Don't "buy and hold" anything long but silver and gold. Hey, I'm not telling anyone what to do unless you are clueless and headed for bad advice. News is propoganda.
PAAS - 1999 annual report out....white hot on the white metal
Being a minor stockholder of Pan American Silver, I just received their 1999 Annual Report....an excellent historical document for future historians of the coming silver fiasco....
Rosie Moore VP Corporate Relations at 604 684-1175 will happily mail anyone this report for free...order one for the fun of reading in a few years...perhaps some of you might even join me in the club of minor shareholders.
P.S. Highly suggested reading for all those who enrolled in the silver pledge.
I've been chewing on this one for months; wracking my brain to get some decent lyrics to hang on it. The refrain is the best part about it though, I find myself humming it constantly.
Hope you like it.
Got puts?
THOSE WERE THE TRADES
Once upon a time there was a market
Where a stock could rise a point or two
Remember how we traded after hours
And dreamed of getting in an IPO?
Then the NASDAQ spike went rushing skyward
We lost our sense of value on the way
We'd bid up companies that had no profits
While staring at our CRT's all day
(Poignant pause)
Those were the trades my friend
We thought they'd never end
We'd bid and ask and never have to pay
With every stock we'd choose
We'd buy and never lose
Those were the trades, oh yes those were the trades
While drowning out my sorrows in the tavern
The bartender had on CNBC
There on the screen I saw a strange correction
Was that penny-stock MFST?
I listened for the old familiar blather
Of paradigms and New Economies
But the anchor-babe ignored the teleprompters
Looking in the camera's lens she said to me........
(Big Poignant Pause)
Those.......Were........The........Trades my friend
We thought they'd never end
We'd bid and ask and never have to pay
With every stock we'd choose
We'd buy and never lose
Those were the trades, oh yes those were the trades
Not trying to be cryptic here...just trying to see which puzzle pieces go with which puzzle:
1. Why do companies go public? Answer: To raise money, mainly. Why, after all these years, did Goldman Sachs go public last year? Answer: They needed the money(?)
2. Why did Rubin leave the Treasury last year?
3. What you're not hearing from anyone on TV about the market (but someone posted a link here today partly about this subject) -- What really happened last Tuesday, April 4th? I know the what, but not the why...the Nasdaq was down big but the real carnage did not begin until a huge sell program(s) hit the FINANCIALS. It came out of nowhere and took the legs right out from under the DOW. What caused that trigger to get pulled? Why the financials? What did someone know that caused them to bolt?
4. Who stepped up to save the day during that big swoop down?
5. Anyone notice which money center bank (financial) stock is getting taken apart the worst by far? Yep, Goldman Sachs.
As Al Gore would say, they're getting their lungs ripped out.
6. Let's see, GATA working on the Treasury, ESF, and Goldman (among others). Hmmm.
Anyone think that George W. can really win this thing in a strong market/economy? Come on, be honest. Me neither.
Oh, I posted this bit of info on Kitco last night:
Heavy (and unusual) accumulation in Barrick Gold the past 6 days (now 7). That's where the big money goes when gold looks good (personally, I'll pass on ethical grounds). Wasn't George Bush Senior an advisor to Barrick at one time within the past few years? Remember that huge wad of calls Barrick purchased in February?...Very nice.
Everyone ready for another scandal?
More and more puzzle pieces, not sure they all fit together, but I'm sure trying!!
http://216.46.231.211/credit.htm"Importantly, what is now developing is clearly much more than a
correction for technology stocks. Instead, we are witnessing the piercing
of the historic technology financial bubble that has grown to monstrous
proportions for both the stock market and credit market, not to mention
the economy. Technology is truly at the epicenter of a massively
leveraged financial sector. Be it the day-traders who purchased Internet
stocks on margin, or the hedge funds that had made big leveraged
technology bets in the derivatives market, or the egregious lending to
Internet and telecommunications companies by the financial sector and
capital markets, the tech bubble is all about credit excess."
PH in LA: That post (spam) was interesting. I heard from another source that the loss in capital was $2 trillion. I don't know if that refered to today's losses or from the beginning of this recent Bear market. Also, Elaine Yager a senior VP analyst from one of the houses on Wall Street called this a "minor correction". Yes, we do need some comedy today.
tedw: The SWC hedge is cover to the downside. The upside move in PGM prices have full open exposure. This is unlike the gold producer hedges. SWC got burned once with typical hedges a couple of years ago. They let their CFO "pursue other interests", and restructured their hedge book so that they had a floor price built in, and no cap to the upside. Hope this helps. Also gidsek posted a link for you last night to info on another PGM producers operations. Good luck.
A few days ago, Bill Murphy of GATA mentioned that the organization has received financial support from several gold mining companies - some of which "would surprise many..."
Which company would surprise me the most? Barrick Gold. Don't know if they have or not, but sure is interesting, no?
Final Thoughts on Leonard Kaplan (LFG Bullion), Gold Bear
When Mr. Kaplan states to the media that gold failed to perform as a proper flight to safety in yesterday's market mayhem, then either he simply looks at the glass as half empty or else he is entirely disingenuous.
The fact is that, upon release of inflation figures, gold immediately popped up over FIVE dollars, at the same time that bonds, stocks markets, and the US Dollar dropped severely. All conditions at that point were in place for a good solid gold bull run. The main reason: with bonds falling in price, that completely disrupts the gold carry trade as it is imperative that bonds rise in price in order to make profits in the gold carry trade. Remember: gold that is sold short is immediately converted to US Dollars, then invested in US bond instruments. Thus the extreme importance of rising bond prices in maintaining the profitability of the entire gold price suppression scheme.
However, quite early in the day, the bond market decided to ignore the bad inflation figures, and swung around and limped into positive territory. At the same time, naturally, gold broke down, finally settling up only a bit above a buck.
Did the bond market abruptly improve owing to governmental intervention? Quite possibly, since the Clinton government already proved its willingness to intervene there by buying the 30 year treasury bond with so-called budget surplus monies. The government did so at a time when the 30 year bond threatened to break down completely, thus endangering a variety of commodity and currency carry trades.
Moreover, the actions of the bond market today simply made no sense. In the face of an unexpected, unusually bad inflation report, the bond suddenly rallies???? Very strange.
Finally, Mr. Kaplan conveniently omitted mention of yesterday being options expiry day for the gold market. Hence the urgent imperative of bullion banks shorting gold into submission in order to avoid demands for physical gold from those who might exercise in the money gold calls. No doubt much of the bullion bank gold shorting yesterday consisted of naked shorts, as it becomes more and more apparent that these institutions are already so deep in the short hole that it no longer matters how much deeper they go. They appear to be technically bankrupt, if astronomical gold short figures provided by Mr. Veneroso, etc. are accurate, along with much lower available annual gold mining supply to cover those short positions.
Given the quite obvious enduring stranglehold that Wall Street and the US Government have over the gold market and the mass media, then it should be no surprise to anybody that gold is not sprinting upward under these troubled financial conditions.
Once again, to repeat the litany, the sprint will not likely occur until the simultaneous breakdown in the US Dollar, the US stock markets, and the US bond market. Again, that leaves only one truly compelling flight to safety, precious metals. Furthermore, it creates a climate wherein foreign investors will take flight from US Dollars, seeking some other more stable investment to the unsettled US Dollar.
Finally, some concrete event(s) must transpire that energize the mass psychological shift already underway.
Quite simply, where gold is concerned, it is not enough for Americans to see falling stock prices. For complacent bulls, it's "been there, done that." That development alone does not translate into any urgent need for safety havens.
Rather true (albeit unfortunate) adversity that confronts Americans on a direct level (such as the long gas lines of the Jimmy Carter years) will likely trigger a rush for a safety haven whose value is not dependent upon the health of the US economy: Gold.
Finally, Americans need to be re-educated as to the very existence of this safety haven option known as gold. You cannot race toward a safe place if you do not know of its existence. It is not enough for goldbugs to preach its merits ad nauseum to the choir on three or four goldbug forums. They need to spread their message far and wide to mainstream forums in a manner no different than the hordes of gold bears who regularly bombard the media with anti-gold messages or invade the gold world itself after days like yesterday. They invade solely to discourage gold investors regarding the metal's potential and cheer the merits of bubble investments.
Of course, the real education should be provided by the World Gold Council (however it does a truly miserable job). That is why it is time to vote AGAINST all gold producer managements and ALL gold producer proposals at upcoming annual meetings. Aside from a litany of sins, I believe their greatest sin is the abysmal failure to educate investors about the positive merits of gold PLUS their pathetic failure to support lobbyist groups like GATA aiming for much needed transparency in the shadowy gold market.
http://www.usagold.comMaybe the reason gold DID NOT go down today is because we are at the bottom.
Seems FOA mentioned the $280 level befor... Any truth to this?
From Solomon's linked site, the spoof publication "Onion" :
"So people finally figured out that all that money in Internet stocks is largely imaginary, and that sent the market plummeting? Gee, better not tell them about banks."
People did not take up Gary North's pre-y2k alarm about banks holding only 2-5% currency available to cover all deposit accounts. They seemed pretty hard-boiled (cynical) about the y2k trigger for bank runs. They refused "to be stampeded."
But now it's a good old-fashioned market crash. And the banks have financed anything and everything, from "investment" on margin, to Silly.coms (see Doug Noland's PrudentBear.com essay). http://216.46.231.211/credit.htm
The negative 2% savings rate means, as you say, people are looking for something to make a "killing" for them, not a dumb old bank account. SOMEBODY got out with cash for those stock sales, at the peak, and all the way down. It's in money market funds now (getting lent to corporate paper and GSEs most likely). It's HOT money. It won't take much of it to move gold, a lot. All that money Alan helped create last year...yeah, baby!
So in kind of a back door way, they are hedging their exposure to bank runs by keeping money out of banks. (Although $3.5 trillion in bank accounts -- last year's figure -- is pretty substantial. They've hedged that by borrowing it back out, borrowing it out longterm while keeping their deposits shortterm.)
Not a pretty scenario for the money system. The dominos are all lined up. It only surprises us in how fast it goes.
$5 Indian put it well: "As the equities bubble pops it first exposes the derivatives bubble, then the consumer debt bubble, and then the Real Estate bubble. The consumer debt bubble will lead to extreme weakness in REITs and eventually runs on weak banks.
I LIKE IT!
Got puts, you ask? Interesting thought. It makes me wonder when the "masses" will discover that there is much, much, more profit to be made on the downside of this Ponzi scheme. Maybe Schwab will start running ads with some brain dead athelete asking his teammates if they know what a short squeeze is?
"Even with all the nips, tucks, finagling and lies, the
government had to admit yesterday that inflation is
worse than it has been letting on.
Surprise!
Guess what? The 0.7 percent jump in consumer prices
in April doesn't even begin to address the inflation
problem. In the coming months, the Consumer Price
Index will have another percentage point or so of
catching up to do.
The Federal Reserve isn't even looking at the CPI
anymore. Fed governors know the figure is
untrustworthy. They've come to rely on privately
compiled price figures, which for months have been
showing that inflation is a problem.
But Wall Street does continue to pay attention to the
CPI, and stock prices got hit hard again yesterday
because of that number.
The Fed doesn't meet again for another month - and
the market should continue to be nervous until then.
When Alan Greenspan and the other Fed governors
meet on May 16 to decide on rates, they'll probably
opt for a hike in line with whatever the stock market is
expecting.
Wall Street is pretty much anticipating a rate hike of
half a percentage point. But if the stock market
continues to decline, Greenspan will probably have to
take the more cautious course and raise rates by only a
quarter point.
Either way, it'll be the fifth interest rate increase in the
past 12 months. That would be a record pace for hikes
in a presidential election year - a time when the Fed
usually tries to keep borrowing costs steady so it
doesn't get accused of interfering with the political
process.
If rates go up by half a percent - 50 basis points in
Wall Street lingo - it could mean that the economy will
slow right around the time of the November election,
and continue slowing into next year.
A major decline in the stock market might be enough to
convince the Fed to go lighter on the rate hikes nearer
to the election. But it must continue the appearance that
it is fighting inflation or risk criticism from foreign
countries and the wrath of foreign investors.
And as much complaining as has been heard, the stock
market really hasn't caused people to feel poorer - at
least not yet.
Even with the most recent decline in stock prices, the
Dow Jones industrial average and Standard & Poor's
500 index are down only moderately this year.
These indices represent the Old Economy companies
that'll be hurt by higher borrowing costs and are feeling
the sting of higher inflation, especially in oil prices.
The Nasdaq is down more than 34 percent from its
high this year. This is a massive drop that occurred
mostly in the last month. But that decline still represents
only a fraction of the gain that over-the-counter stocks
have achieved in the past few years.
It's those gains in stock prices that have had the Fed
most worried. This "asset inflation," as Greenspan calls
it, has been causing prices in the real world to rise
because investors feel so rich.
But even a big drop in the stock market might not
accomplish what Greenspan wants.
Investors could decide to liquidate stock-market
holdings and put the assets to work in things like real
estate, which might be perceived as the next "safe"
haven. That would cause more inflation in the economy.
Various parts of the stock market have been in turmoil
for months as investors rotated their assets. But over
the past two days, both the Old and New Economy
stocks got blasted together.
The entire market is likely to remain dangerous for the
next few weeks and will probably settle down only
toward the end of the second quarter. That's when
money managers need to push prices higher so
customers don't realize how bad the quarter really was.
Such nonsense aside, inflation and interest rates are
likely to remain the market's focus until the end of the
year.
This stock market bubble has been fun - until now.
There's a time when bravery ends and foolishness
begins. This stock market right now is for fools."
"Go hide under the bed for a while." - Fred Ketchen, chief of equities trading at Scotia Capital.
---
"It was a momentum market on the way up; it is a momentum market on the way down." - Nick
Sargen, an investment strategist for J.P. Morgan.
---
"When confronted with uncertainty, whether in financial markets or in any other aspect of life,
disengagement is the normal protective reaction." - U.S. Federal Reserve chairman Alan Greenspan.
---
"We had a semi-panic, almost a full cascading deterioration. The real question is, `have we reached the
nadir of emotion?"' - Ned Riley, chief investment strategist for State Street Global Advisors.
---
"There will be probably more clients that will be subjected to calls Monday morning saying: `You've got
to put it up or else we're selling you out."' - Ketchen on the practice of buying on margin, which
contributed to the momentum of the market's downward spiral Friday.
---
"Humility is good for people. It can hurt in the pocketbook, but in the long run it can make them a better
investor." - David Driscoll, vice-president of equities at Toron Capital Markets Inc., says the plunge is
wringing the "arrogance and greed" out of the market.
[From CANADIAN PRESS, Fair Use for Educational/Research Purposes Only]
Good Morning all,
Isn't it an exciting time to be alive and witness to the world around us? Mr. Hat, I just bought myself a new Metal Detector, and am wishing to try it out....now where did you say you lived again???
On another note, I am in the middle of MK's "ABC's of Gold Investing, and was attempting to talk to a co-worker about some of the information contained in the book about the value of the dollar and how it had decreased such and such an amount since '72, and he informed me that it was no big deal, and really intimated that I was naive for being concerned over such a paltry decrease. I then tried to talk about the expanding money supply, and the hidden inflation rate, and he proceeded to tell me that I was mistaken and misled-he could see no real inflation, and that the money supply was not to be worried about, it had been happening forever and would continue to do so without any real effect on citizens such as him or me.
He just basically blew me off, and really made me feel ignorant. I am not the great communicator that many are, here on this forum, and I blame 80% of what happened on that fact, but what really bothered me was that he seemed GENUINELY unconcerned that the CRASH the markets experienced yesterday was anything to get concerned about. He even made the comment that yesterday's drop was only a fraction of a drop, and nothing to be worked up about.
I feel like "a voice crying in the wilderness."
For 100 years Noah built the ark, but his main purpose during that time, as given to him by God was to preach to the people of the coming destruction, and their need to repent. How long do we have before the rains begin to fall?
Was that a sprinkle I felt upon my cheek? Are those dark clouds coming our way?
Even as I sit here I see a scrolling news page that tells me "KEY ANALYST: Stocks to rise-Reuters"
My parents have all of their Ira's and savings in the stock market-their retirement money. I have tried to speak to them about placing 20% of that in Gold, just as a safety measure. They turn a deaf ear to me as well. My only option, as I see it is to personally purchase enough to cover myself and my WHOLE family. I am concerned now that time is not in my favor any longer. Those of you who seek God's help, let us earnestly pray that He will provide enough time for us to prepare, so that we may finish our Ark before the rains come.
Anyone: I would gladly accept any advice on how to better get through to my loved ones on this serious matter.
Was beginning to believe Gov't manipulation was keeping mkts stady. What happened yesterday? Is paranoia getting the best of us? Yet, why didn't gold continue to move up? Can any of this be rationally explained?
There were a number of notable components within the CPI report. First,
housing costs, which are 40% of the CPI, rose .4% following a large .5% gain
in February. That this key component rose sharply for a second straight
month might be the most worrisome development in the CPI. It appears that
the Bureau of Labor Statistics has finally caught up to the real world and is
now capturing the soaring cost of both home ownership and renting. Who,
after all, doesn't know that home and rent prices have gone up dramatically
recently? There was one part of this component that was a little suspect,
however. Hotel costs rose a large 3.2%. The BLS is saying that they may
have had difficulty with their seasonal adjustments. But some of this likely
reflects high levels of travel by American consumers and business persons.
Second, medical costs continued their ascent with a .5% monthly gain.
Medical costs are now up 3.9% y-o-y. This component continues to be
bolstered by sharp gain in prescription drug costs (+.3%), medical care
services (+.5%), and the cost of professional services (+.5%). Here again is
data that appears to be based in reality; for some time now, there has been
plenty of anecdotal evidence that health care costs have been moving sharply
higher. Big increases in health insurance premiums are a key example.
Another worrisome trend is the emergence of secondary effects of oil on
various types of goods and services. A microcosm of this is the cost of air
fares which rose 4.6% in March. There are other areas, too, that are seeing
similar effects owing to the jump in transportation costs. This is because it
affects such a broad range of goods and services; 80% of all goods are
transported by truck and trucking fees are rising at a 5-6% annual rate.
Basically, today's wakeup call on the CPI is the real deal. It's not just a few
items driving inflation and it appears to reaching ever-more of the reaches of
the BLS's survey of 90,000 items that comprise the CPI."
Stranger's Note:
With all due respect to the room, I believe we will soon add "too-high stock prices" to complete the list of horsemen which have come and gone without helping gold. Others are "introduction of the euro", "Y2K" and "oil". We are now left with the one factor which the price of gold cannot and will not long ignore...inflation.
Until yesterday, rising prices were being poopooed by the mainstream media. I expect that has now begun to change. Last week was about going to cash. Next week and beyond will be about what to do with that cash. Someone has said that gold is now just an industrial metal. To a public which has been lulled into believing that "the new economy" has made inflation obsolete, that may be true. But that faulty perception is now falling away and will undoubtedly be replaced by a concern for where to put one's capital in an environment of rising prices.
Once out of the box, inflation is difficult to restrain. Many companies have held off raising prices for YEARS fearing loss of market share. Now they have been given the green light to make up for lost time. Meanwhile, a central bank which was far too liberal in the face of a growing bubble is hardly going to show the necessary courage of restraint now that the bubble has burst. In this way, the inflation is liable to feed on itself for awhile, and as it does, interest in inflation beneficiaries will certainly reawaken among investors.
http://www.irs.govdownloadable forms and schedules.......driving to the library? Just say no.
===========================================================
Think you have it tough? I married a former non-resident alien and we're filing a joint return. I have no way of knowing how much income she earned while working on other planets. If she spends more than six months aboard the mothership then I can't claim her as a dependent. With the Iridium system down I have no way of dialing out. Since I wasn't abducted against my will I can't claim the "work loss due to abduction" deduction. But if I can get a job aboard the mothership for over 180 days of the year, then I can take the $700,000 extra-terrestrial source income exclusion. They are trying to encourage expatriots who "really want to go all the way" to at least remain in the galaxy. The word out is "Don't sell the yacht in Newport until you know the aliens accept you and permanent residencey can be established."
More & more people are becoming aware of importance of "protecting gold"
"We Americans have set dangerous precedents. We can
rest assured that those pushing for gun control have no
intention of stopping short of total gun confiscation. At
some point, we who cherish liberty must summon the courage
of our forefathers and tell America's tyrants, "Give me
liberty, or give me death!" The longer we wait, the greater
the ultimate bloodshed." -Gun control: What's behind it,
[well-known] economist Walter Williams, [Greensburg, Penna.]
TRIBUNE-REVIEW, April 2, 2000
I saw Bill Woman on Neil Cavuto's business report this morning. It really was quite funny. Bill Woman is an anti-gold econ reporter for Business Week. This morning when asked about the "Bear Market" he went into a fit claiming, "it's not a bear market, it's a correction!!!!!" I about fell off the couch laughing my a** off! When asked about Cyclicals and Precious Metals, he was in camera from the back holding a glass of water, I thought he was going to start spitting venom! It was outrageously funny, his back arhed up, he choked on his water, and starting shaking his glass of water. Hey, gold just affect some people in different ways :-)
Beesting, thanks for the second to Thursday's msg#28562
Jon:
Yesterday's 617 pt. Drop from 10922 was a smaller percentage than the 540 pt. drop in the 7000's of Oct. �87. On that occasion it was the following day, after a further sink in the early trading, that the PPT poured the coal on the boiler and shot up the averages. Assuming a repetition then, we should see a major turnaround Monday morning and all the sheeple will be saying "I told you so."
I think the sequence will be a market recovery that staggers along, leaving in its wake a reduction in "Spendomania." This will first encourage investors and speculators by a reversal in the inflation statistics (Lower Oil is already in the pipeline) but then the poor earnings reports will start to appear and that will bring on the true bear market.
I'm going into town today. I will be looking into some more PMs of course, since I only go into town about once a month anymore. But I will also pick up 2000 rounds of 7.62X39 fun acedemic research, I assure you ;-) Besides, they're cheaper than reloading. I am also in the market for a couple more SKS composite (and collapsable) stock rifles and maybe even a spare Bushmaster or HK 91.
Last night I talked to one of my friends in Montana. He and I toasted our investment successes in the markets, and how we were able to bail just in time with a lot of profits. He asked about where to put his gains now that we had avoided the carnage on Wall Street. My suggestion was about 20% into PM's. His wife agreed. We are all in the PM mining business, so I didn't think that would be a problem. Then he asked about the rest. I had to think a bit, but then it hit me. He is moving back ionto his house that he had rented. I said, "you know, with all the dot.com people losing their shirts, they won't be buying those new homes, rather they will have to repair and refurbish their old ones like your doing." "Why not Home Depot!". But this did get me thinking. The speculative nature of the dot.com market might just be over. No more B2B, new paradigm, or dot.com mania, rather companies that actually have earnings. Yep, time to go friends, and buy some more PMs, place an order for more PM mining stocks, ammo, and beer!
And hey SteveH, I saw some Muleys this morning. Going to be a barbecue this fall!
A gold mining friend of mine has left the following on my voice mail:
Last line from Greenspan's speech yesterday: " As rising financial uncertainties may rapidly change the financial sector ... not clear, though clear enough for me). ... I'm sure that the nostalgia for the automaticity of the gold standard will rise, among those of us engaged to replace it!" Amazing!
Sharefin - thank you for AG and AU pledge, will participate, though I feel we should rally around GATA as our prime gold bug advocates and think of efficient ways and means to install these great guys as our # 1 lobby. They have have proven their effectiveness - thank you Bill M. and Chris P. for your efforts. If I may, MK, I'll post a rough outline of what's on my mind shortly!
Go gold - CB2
I'm no ORO, but I watch things fairly closely, and it looked to me like the PPT made a foray just a little after 12 noon when things were dropping fast. If so, this caused a quick recovery of about 100 points in DOW & about 70 in NASDAQ (the markets moved in tandem yesterday.) But the decline took even that relatively small gain back in about an hour.
I made a note that this didn't look too effective, and that unlike last Tuesday, they were fighting "fundamental" news, that is, official inflation figures. My note also says, "If I were the PPT, I'd hold my fire till the last few minutes of the session to leave a good impression for next week." It looks like they took my advice. ;< )
On the other hand, TBTB want a decline, though they want a soft landing too. (You know what they say about people in hell, though.) So maybe it doesn't make sense for them to really pull out all the stops.
BUT KEEP IN MIND, THESE PEOPLE PUT THEIR PANTS ON ONE LEG AT A TIME JUST LIKE THE REST OF US. Don't invest them with more power than they have. And that's really not all that much and declining lately. We're under control of a process that gradually built up over decades. But when it releases, just like the water in your flush tank, it all happens much too quickly to control. Once an avalanche starts, who's going to stop it?
Of course, as you suggest, we could just be paranoid. I hope so.
I think Greenspan & co are selecting their goals carefully. They are figuring how far a perimeter of the financial structure they can defend. They have already succeeded in giving the smart money time to bail out. (Anyone who hasn't by this point is, well...)
Their main worry at this point is to keep the payments system working, as they barely did in 1987 when it was a hair away from seizing up and taking Everything down at once, by a failure of the mechanisms behind all of the transactions, whether markets are up or down.
They probably, as someone else indicated, have figured on defending the dollar over the equity bubble. They are now tallying up the many possible "cascading cross-defaults" on the horizon and figuring out a liquidity plan to cover them.
Christopher: Family
One aspect I've not seen mentioned elsewhere. You are probably not alone in this financial life. You and your extended family comprise something of a whole, at least in two extremities: death, and hard times.
When you hold gold, you are hedging against those hard times for those who will or can not, at least preserving a greater ability to help them.
In your own interest, you may also consider likely inheritances ahead that could be decimated by Wall Street/dollar ruin. You may be individually over-weighting in gold now from a diversification view, but at some point you may acquire a portfolio that contains all that nutty stock stuff, much reduced. You'll be glad you hedged that portfolio sooner, rather than waiting till it reached you.
Not unlike any other catastrophe that could hurt your family; just be there when they need you most. If it's a financial catastrophe you're planning for, gold will ease your transition and help you to "be there". Also, I've given up what you've attempted long ago--had the very same sentiments.
I don't believe there is any in between for those who own gold. Either we are absolutely right or, absolutely wrong. It is a very tough decision to make I know. Keep the faith.
I believe it is a given that the CPI has been fraudulently misstated by the Fed'l. Gov't. for quite some time. Is it possible to form a class action suit of seniors on social security benefits to commence legal action. Can you just imagine the dollars involved and likelyhood of large legal fees?
Perhaps we have all tried at one time or another to send a Buy-Gold message to those we know with various degrees of vigor running the spectrum from emphatic urging to casual mention. (The casual reference to Gold is invariably the most effective.) Assuming that the majority of your "teachings" fall upon deaf ears, have you noticed that the failed attempts that hurt you the most are the ones where the audience is the closest to you? It's easier to dismiss a co-worker or casual acquaintance's indifferece than it is to be met with similar indifference from your closest friends and loved ones. After all, aren't these closest ones the very people that you would like to help the most?
Allow me to share my own experience. It may be an approach that will suit you also. There are only two fundamental rules to remember. 1) don't preach. 2) be yourself.
"Don't preach" means that while engaged in conversation with the person you would like to help (Co-worker, friend, family) don't launch into an anti-dollar, anti-government, anti-bank, pro-Gold, pro-freedom message. Don't try to talk about money supplies, or currency crises which have swept through foreign lands throughout the known history of fiat currency. They will tune you out just as surely as you tune out their oratories on the virtues of various bubble.com stocks and the glory of the new economy. Simply mention Gold only when and if it is appropriate to do so within the context of your conversation. All you are trying to do at this point is to plant a tiny seed--to let them know that as events unfold in the future, you are the one person they know that has some Gold and could probably answer a question or two that they may have.
"Be yourself" is all about being the best damn You that you can be. You've got Gold, so you can sit back emotionally detatched and witness falling markets and depreciating currencies while others around you are fretting that the economic sky is falling. Without these unwelcome distractions of worrying about the viability of your accumulated retirement funds, you can focus on the only real task at hand--living the best quality life you possibly can, and enjoying every minute of it because you have things under control. Your destiny belongs to you. Trust me on this--your closest friends and family will notice that you are somehow steering the more desirable course through life. When you can compassionately listen to their sorrowful tales of market frustration while yourself remaining the picture of serenity, they will know. They will know. Answer whatever questions they have about Gold, and if they need more answers than you can provide, direct them to the internet.
It all comes down to each person discovering for themselves that life is better when they switch off the autopilot and cut away from the mindless lemmings rushing headlong into the sea. The only way to get full enjoyment out of your tiny and brief existence upon this planetary garden as it hurtles through the cosmos is by chosing to live life deliberately, under your personal terms. The saddest cases are the people who live and die without the knowing the satisfaction of that final conscious reflection upon departure, "I lived life well. I did it MY way."
The Hobbits also wish to second the old dredgedup msg#28562 to the HoF. This proves that some folk are way ahead of the herd and it really pays to roam the halls of the archives every now and them to recover these gems. IT NEVER hurts to restudy the sayings of ANOTHER and FOA either. Shall the masses be studing in the Universities from texts of the teachings by FOA in the 2020's ?
<;-)
Good luck with your metal "detecting",..-I think! :-).
Recomending purchase of precious metals to others is tricky business. Especially if they purchase and then the price goes down. I suppose all one can do is bring as much gold education that one has and present a well reasoned case for accumulation. Anything Aristotle writes is a good framework to start in. For sure after case has been made to paper chasers it is their responsability to pick up the ball and run with it.
The intricacies of human nature are sometimes quite baffling, and as an example there were people who were told to get off the side of Mt. St. Helens, but who would have none of that and blew up with the Mountain.
I spoke with Pete again this morning about the market's plunge yesterday. By the way, Pete was a day trader long before that sort of (non-productive) activity became fashionable. Pete thinks the markets have much further to fall. That's not a significant thought.
Here is one that is:
Pete thinks it is smart to be in a cash and wait position at this time. He'll have nothing to do with gold--nothing.
So, you see, it all boils down to a monetary argument. Do you hold dollar money or gold money? Which is more valuable? Although both have relatively universal appeal, I side with 5000 years of history.
I wish Hathaway were justified by events truly. No, for gold to rise, the dollar must take its lumps.
Thanks for joining beesting to support my nomination. Anyone who missed the afternoon/evening posts on Thursday where Peter's fine overview can be found is hereby strongly encouraged to do so. I've provided the Thursday link to help them see what they've been missing now that they aren't currently distracted by the falling market spectacle.
HI-HAT, thanks for the nod. Cavan Man, don't lose sleep on Pete's behalf
In keeping with my earlier thoughts, it would appear at this time that Pete is deliberately doing things HIS way, and therefore you should simply respect him for his convictions. Imagine if all of your friends and family tried to talk you out of your Gold. God knows it's bad enough that we have to endure a barrage of pleas from the media and analysts trying to talk us out of our Gold or to "save" us from ourselves should we think about increasing our Gold holdings--and they don't even know us!! (Kinda makes a guy wonder, 'What's in it for them to steer us away from Gold??')
Putting aside the deliberate life for a moment, as you say, "it all boils down to a monetary argument." That's right. Are you more comfortable letting a centrally managed currency (which is really nothing more than an easily manipulated and inflatable system of accounting) represent a significant share of your net worth, or would you rather hold the tangible monetary asset that was created with the Universe in finite quantities, having universal recognition and appeal across all national boarders?
The thinking man chooses that which is real.
By the way, I enjoyed your tale of many days ago in which you took the kids and your jar of pennies, nickels and dimes to show them how it could be cashed in for a few Gold coins. (I've got some of the Hungarian Gold you mentioned, rubbing elbows with the sovereigns, the French, Swiss, and Belgian Gold francs, the German Gold marks, etc. Mine is an equal opportunity household. The Hungarians--lovely coins, aren't they?) When your child saw the significance to say "Daddy's got Gold," that's beautiful in its simplicity. Your kids are well on the road to clear thinking for the rest of their days.
When I was a tyke it was still illegal for Americans to own Gold. So when I was taken to cash in my piggy bank, all I got was a passbook savings account in return--as I mentioned yesterday. To rub salt in the wound, all I need to do is think of all the real silver coins in that piggy bank that were given up for a paper number. Sheeeeesh...what an anti-climax for the "breaking the piggy bank" event. Not a very good lesson in equivalence for a kid, was it? But I guess I still managed to turn out ok. I have been more than compensated during this current era of Gold at give-away prices.
Just finished my taxes. I didn't think I'd have to pay much but I couldn't find the line on the 1040 form to deduct my "quality enhansement" fiqure to lower my adjusted gross income. It seems to me that without this deduction my taxes owed have become inflated. Maybe they'll at least let me adjust downward if I promise to use the "core" rate.
I'm going to be testing the archive system for the next couple of minutes. Posts up to this one will not be lost. I will post again when things are back up. Sorry for the trouble.
-Jeff
I've discussed gold with my father (a fairly astute investor)...he humors me but is not convinced of my arguments -- you see, people are hooked on the idea that if you have excess cash (savings) and wish to "invest" it, that you should be looking for a way to use ALL of it in ways which generate either capital gains or dividends/interest.
(The CB's have the same problem!). There is a huge complacency out there about the need to buy some insurance for one's wealth. That's what gold really is - insurance. When I buy gold, I NEVER INTEND TO SELL IT, EVER! I am transferring a portion of my paper wealth into a hard asset. If the worst happens and I find myself destitute (for whatever reasons), well - then, yes...I have something to fall back on. I will pass my physical holdings over to my heirs (sorry, Mr. Tax Man!). This is the Oriental approach to true wealth creation/preservation...something the majority in the western democracies have lost.
My father was semi-interested until he asked how to go about buying and SELLING gold...to him, it seemed more complicated than buying stocks or bonds...and he didn't like my "never sell" part! He didn't understand the mindset of locking in assets without the intent of taking a capital gain...I went on to try to compare it to home equity - then gave up.
I participate on several forums on the net, including one on TheStreet.com. I no longer waste my time trying to "preach" gold as a means of wealth preservation....it falls on deaf ears. If the subject comes up, I throw in a quick two cents worth and that's it (something like - yes, I use it in the diversification of my portfolio). If someone wants to know more, OK, then I go into it. Basically though, it's a lost cause and will be so until the public sees POG back over $350 an ounce and rising in an environment where the stock market is not performing well. That's just how it works...the great mass of people always wait until it's obvious - by then, of course, it's usually too late.
First, thanks go out to FOA for the fine commentary. I certainly look forward to the next installment.
lamprey_65, in your comments regarding your conversation with your father, you said "he didn't like my "never sell" part." You then said, "I went on to try to compare it to home equity."
I think this last tack may prove to be your more fruitful of approaches.
As I tried to make the distinction on Thursday, most people in our very fortunate nation have thus far been spared a true currency crisis, and have therefore failed to make a meaningful distinction between currency and wealth. There is a difference! (And you, good sir, clearly recognize this whereas your father apparently does not--yet!)
Most people do not look at their house primarily as a "currency generator." They see it as a necessary shelter for themself and the real things they own. Certainly, one could engage in the house trade market as a means to generate additional currency, and some people do. But to draw a closer parallel to the typical western Gold market, these people would actually be buying only the blueprints of houses, and not the houses themselves. Their profit or loss is determined by whether the price of bluprints rises or falls based on the supply and demand for blueprints.
And most fortunate for the rest of us, to continue this analogy, the price we must pay for the real wealth of a real house is based upon the low price of the blueprint alone...not the intrinsic value of the real built house!
So I say, generate currency in any manner that suits you (such as working at a career you love), and then quickly use this currency as the convenient modern medium of exchange to increase your "net worth" in real wealth.
Take a lesson from the hyperinflation in Germany that reached a fever pitch in 1923. Throughout, the people did what they could with an eye to increase their position of REAL WEALTH. They were not necessarily enamoured of the prospects of increasing their account of currency units.
If it is truly an increase in currency that a person wants, may I suggest they move temporarily to a third world country where the currency they will receive in exchange for their current dollar accounts will have enough zeros on it to make them feel like a very important and powerful person, indeed. Better still, spare the money for the plane tickets, and simply have your bank switch you accounts over to Turkish Lira, for example. Two American dollars will make you an instant millionaire, with each dollar currently exchangeable for 592,000 lire.
When you see real wealth being given away for nominal amounts of currency due to unique circumstances, I suggest you seize what real wealth you can. This is one of those times.
It was nearly a month ago that you offered the counsel of prudence for some individuals regarding the big decision over the fate of their IRA, 401(k), or whatnot.
At issue was the monetary (currency) losses that would be incurred through taxation and penalties for early withdrawal. If a stock market decline and subsequent losses is what they feared, then shifting their funds into a money market account while staying under the tax-sheltered retirement umbrella would certainly fend off the numerical decline of funds in their retirement account. Where, though, can they go for meaningful relief against the potential decline of the dollar itself? It is the rare retirement plan indeed that allows for the acquisition of meaninful wealth in the form of tangible assets instead of "blueprints of wealth" --if I may borrow from my earlier post.
Like you, not knowing the unique financial position of any given individual (age, total and type of assets, etc) it is impossible to give specific advice, and I would be loath to do so, anyway. I am content to share information and opinion, but the decision must always be made by the person when he feels he adequately armed to act intelligently, not instinctively or rashly. Having said that, might you agree that if there ever were a time when someone might most easily bear the tax and penalty burden of the decision to access their own funds in account, with the sole desire to acquire physical Gold at these prices, then this is indeed the time? I say this with the thought that someone might not have access to any other source of funds with which to acquire the quantity of Gold they deem adequate to enable them to sleep at night in this volatile financial world. Specifially, the stock market indices still haven't truly crashed, and reamin at levels well above levels anyone would have predicted several years ago. (Meaning, it has been a remarkable currency generator, spitting forth enough excess paper profits to let someone shrug off the lumps they would take in taxes and penalties. However, time may reveal it to be transforming into a remarkable currency gobbler.)
And further, if physcal Gold is their target use for these newly freed funds, one might also admit that the price of Gold is currently so far below normal as to single handedly offset the early withdrawal penalty and tax, too. Another issue is that we difinately know what the tax and penalty burden is today, however, as long a congress continues to meet in regular session each year, there is no guarantee that these penalties won't be raised further, or that the nominal tax rate itself upon retirement won't be considerably larger than it is now.
You did well in making your case against opting for early withdrawal together with the tax and penalty bite that it would be like imagining Aristotle dividing his Gold pile, and then throwing half of it into the sea. Truly, but the key is that I have the Gold to throw, and half is still better than none. Think of the individuals who currency have all of their "net worth" as contracts adrift on the waves. What is the palatable number to sacrifice to gain the alchemist's secret, and thereby bring the remainder to shore and turn to Gold?
What is the price for peace of mind? Each man must find his own.
Maglor, we are told, in the end threw all he had ever worked for into the Sea to bring himself peace of mind. Sadly, it is also told that he ever thereafter wandered the shores singing in pain and regret beside the waves. But then, he gave up a Silmaril in exchange for no Gold at all. Any paper trade for Gold would be far less lamentable--so long as it is done of one's free will.
Gold. One metal to rule them all... --- J.R.R. Aristotle
Most people do not understand the game they are involved in.
The name of the game is "Full-Faith,and Credit". The whole scorecard since day one, is rife with periodic BETRAYAL.
The Serpent has a head at both ends.
The built in evolutionary human trait is fight or flight.
Those that choose to fight and attempt to seize the serpents neck should not be surprized when the other head suddenly strikes.
Those who choose flight into gold will be out of reach of both heads.
Reading your first update along the trail remined me of a thought I had this very day concerning the method of price discovery for POG. What a strange way to price gold! Comex, LBMA et al are simply wagering arenas you are so very right! Two parties enter into a wager; each party betting on the price to be X, more or less at a precise moment in time. My thought was, why would such a method be chosen? It's not logical but of course, logic has nothing to do with it.
When the gold market was allowed (out of necessity) by the US to become a little more transparent and open and further, when it was again made legal to own gold by US citizens, a means of price discovery had to be found that would still allow for relative control of the POG. Is my footing solid enough? Back then, the POG could be made "more free" but, not liberated.
Like Pooh, I am very fortunate to be a, "bear of small brain" enabling me to read your commentaries and all of the other posts here with a completely open if somewhat empty mind. It really makes it easier for me to "grasp" the big picture. I'm a lucky guy.
Does anyone know what the agenda is, for those who are planning on disrupting the IMF/WorldBank meeting in Seattle, Wash? The press characterizes them as a loose collection of environmentalists and political dissidents. But I wonder if any of them are gold bugs?
Unrelated-
It seems to me like the stock market exuberance is like a tax, that you pay interest on. Consider that the margin loans with on-line trading accounts are in the billions, someone reported earlier on this site. Then consider that the stocks bought were hyped by the financial media, and that many of those stocks have no earnings. If the crash continues on Monday, there will be margin calls galore.
So then the wealth went from the holders of money, (banks), into the stock market, and now the serfs will have to pay the interest for a good time to come. Its kind of like a stiff tax, if you look at it that way, and squint. Takes a little imagination. Far fetched?
Also unrelated-
Bashing gold is like bending Truth itself. It maintains the illusion of a strong dollar, and keeps US markets awash in foreign and domestic cash liquidity. Not long ago TPTB called in the Kuwait favor, and we all thought they had run out of bullets, and were just pistol whipping the Truth. Was that the last hurrah? The Swiss anouncement didn't have much effect. What else can they do to gold?
They have already hung gold in the public square, and cut out its toungue, that speaks the ominous words of INFLATION, US DOLLAR DEVALUATION. But even with its tongue cut out, gold's words still ring in the air. What can they do to silence the gathering shrill scream of those fleeing the markets?
The war on gold by TPTB is one of perception. Only those who have the insight into true wealth can see beyond things denominated in dollars. As long as many or most of the sheeple cant see the value of gold, the theft of earned wealth that we know as the Federal Reserve Note can continue.
And as long as they have more duct tape to bind up the mouth of gold as it screams INFLATION in protest, the dollar game will continue. Step up and place your bets, folks. What'll it be? Tech stock? Gold futures? Dow? Dont be shy, you gotta play to win. Place your bets, place your bets.
"UNIVERSAL PORTFOLIOS TAKE INVESTORS BACK TO THE FUTURE"
April 12, 2000
STANFORD, Calif. (BUSINESS WIRE) - If you've played the
stock market in recent years, odds are you've felt the nail-biting
exuberance of a kid at an amusement park. The ride can be wild,
and many an investor has lost his lunch. Or shirt.
Wouldn't it be great to have the security of hindsight? A time
machine, perhaps? You could travel to the future to find the next
Cisco Systems, jump back to the past to buy stock, and laugh
your way to the bank. Or you could avoid market crashes like
those of 1929 and 1987.
Tom Cover has the next-best thing to a time machine: He has an
algorithm -- a computational procedure -- that uses the past to
predict the future. It works as well or better than hindsight,
outperforming a pretty good investment strategy: diversifying your
stock portfolio and hoping that performance of superstars will
more than make up for money wasted on losers.
Cover, professor of statistics and the Kwoh-Ting Li Professor of
Electrical Engineering at Stanford, described his investment
strategy during an invited talk in Washington, D.C., at the annual
meeting of the American Association for the Advancement of
Science (AAAS) in February. The strategy uses an algorithm that
mirrors universal data-compression algorithms to create the
so-called "universal portfolio." Each day the stock proportions in
the universal portfolio are readjusted to track a constantly shifting
"center of gravity" where performance is optimal and investment
desirable. The result? The universal portfolio performs as well as
the best strategies that keep a constant proportion of wealth in
each stock would have performed in hindsight, "no matter how
the market wiggles and squirms," Cover says.
To create a universal portfolio, the investor buys very small
amounts of every stock in a market -- no small task in itself. The
New York Stock Exchange, for example, lists 3,025 companies.
In essence, the universal investor mimics the buy order of a sea
of investors using all possible "constant rebalanced" strategies, in
which the amount of money invested in each stock is adjusted
each day to achieve a fixed proportion.
The bad news? Universal portfolios need to be rebalanced daily
to keep the highest-return investments near the center of gravity
of the constant rebalanced portfolios, which makes investing a
high-maintenance activity. The good news? The algorithm does
not model the market as an independent, static entity
unresponsive to declared wars, oil gluts and the introduction of
rival technologies. In fact, it does not attempt to model the
market at all.
"Imagine we have, for a simple example, two stocks," Cover
explains. "A good constant rebalanced portfolio might invest, say,
one-fourth in one stock and three-fourths in the other. At the end
of the day, the wealth you have in each stock would not be
exactly one-fourth, three-fourths because the prices of the stocks
change, so you would do the necessary buying and selling to
restore it to one-fourth, three-fourths."
Cover's universal portfolio algorithm invests uniformly in all
constant rebalanced portfolio strategies. The result is a strategy
that is nearly optimal. Cover has shown, for any sequence of
stock market outcomes, that this mixture of investments has as
high a compound growth rate in the long run as the best constant
rebalanced portfolio. Over time, the best strategy (that is, the
best constant rebalanced portfolio) fights its way to the top of the
fiscal food chain.
Economic Darwinism? "Yes, but nobody dies in this Darwinism,"
Cover explains. "The unfit investments still survive, but at
exponentially reduced levels of wealth. The surviving investments
dominate your holdings."
Cover earned a bachelor's degree in physics from the
Massachusetts Institute of Technology, and both master's and
doctoral degrees in electrical engineering from Stanford. As a
graduate student, he was intrigued by the work of statisticians
David Blackwell at the University of California, Berkeley, and
Herbert Robbins at Columbia, who developed a robust theory
for playing repeated games, such as predicting the outcome of
coin flips.
He was a contract statistician for the California State Lottery
from 1986 to 1994 while at Stanford, designing tests of the
lottery balls and wheels, analyzing the payoff structure of games,
and finding ways to beat the lottery so the state could devise
ways to protect itself from fraud.
His interest in the mathematics of gaming lends itself well to
another form of gambling -- stock market investment. But
whereas gamblers and investors rely on intuition and advice,
Cover utilizes equations.
"A good theorem is like a joke," Cover says. "You're led to
believe something and then a surprise causes you to laugh. A
good theorem makes something very clear that you didn't think
was, or it flies in the face of your intuition. The joke with universal
portfolios is that you seem to get something for nothing."
If you think it odd that an electrical engineer and statistician
would ponder the stock market, it all adds up. Cover is a pioneer
in information theory, a field that treats all information as
quantifiable but ignores the semantic content of messages.
Information theory has been applied in fields as diverse as
wireless communication, data compression and deep space
communications to transmit information without errors. The field
was born in 1948 when research mathematician Claude Shannon
provided a theory that laid the foundation for phone and Internet
communications. With Joy A. Thomas, formerly of IBM,
Yorktown Heights, N.Y., Cover wrote what many consider the
benchmark textbook on modern information theory. He has
written more than 115 papers. In 1990, the Information Theory
Society of the Institute of Electrical and Electronics Engineers
(IEEE), the world's largest technical professional organization,
gave him the Claude E. Shannon Award, the highest honor in
information theory. In 1997, the IEEE gave him the Richard W.
Hamming medal (a gold medal and $10,000) for "fundamental
work in information theory, statistics and pattern recognition."
Joining the Stanford faculty in 1964, Cover was named professor
in 1972. He directed Stanford's Information Systems Laboratory
from 1988 to 1996 and currently leads a research group in
information theory. His work has influenced areas as diverse as
broadcasting of high-definition television, bandwidth
compression, mobile telephones and theory of stock market
investment. In 1972 he introduced the concept of superposition
in broadcast channels, which made it possible to send information
simultaneously from one transmitter to multiple receivers. His
paper on the topic is credited as one of the pioneering works in
network information theory.
Cover is a member of the National Academy of Engineering and
a Fellow of the IEEE, the Institute for Mathematical Statistics and
the American Association for the Advancement of Science. He is
a past president of the IEEE Information Theory Society.
One aspect of information theory is data compression. "The
beauty of it is, the mathematics of growth-rate-optimal investment
turns out to be parallel to the mathematics for optimal data
compression," Cover says. Thus universal investment algorithms
are a counterpart to the universal data compression algorithms
used to compress voice, fax and computer files.
Theory meets the real world
How well do universal investment algorithms do on real data?
Consider the cases of Iroquois Brands Ltd. and Kin Ark Corp.,
two stocks chosen for their volatility on the New York Stock
Exchange. Cover looked at 20 years of data -- that's about
6,000 trading days -- ending in 1985. With the buy-and-hold
strategy, every dollar invested in Iroquois is worth eight dollars
after 20 years. With Kin Ark, every dollar invested earned four.
The best constant rebalanced portfolio would have achieved 74
dollars for each dollar invested. But because the universal
algorithm always lags behind the center of gravity by a day, it falls
short of this theoretical maximum and achieves only 39 dollars.
Still, not too shabby!
A key feature of the algorithm is that the return on investment is
exponential, like compound interest. A good way to visualize the
tremendous growth potential of an exponent (a number "raised"
to some power, like 2superscript3 = 8) is to know the legend of
the king who unknowingly gave away his kingdom to a peasant
who had done him a favor. "I'll give you anything," the grateful
monarch is said to have promised. The peasant looked at the
king's chess board and asked for one grain of wheat on the first
square, two grains on the second square, four on the third square
and so on. The innumerate king agreed and unwittingly gave
away all his wealth.
With the universal portfolio algorithm, profit grows exponentially,
Cover says, and the average of exponential growth rates has the
same growth rate as the maximum.
"This is an automatic investment algorithm in the stock market,"
Cover says. "The portfolio rides the stocks and lives off the
fluctuations. It essentially puts a little bit of money on every
possible rebalanced investment algorithm, and the surviving
algorithms -- the ones that made most of the money -- make
enough so that your money grows at the same rate as if you had
used the best algorithm to start with."
So who wants to be a millionaire? The math-apt can read the
paper that first detailed Cover's algorithm (T. Cover. Universal
Portfolios. Mathematical Finance, 1(1): 1-29, January 1991).
The subject of his AAAS talk was more recent work with one of
his 50 former Ph.D. students, Erik Ordentlich, and one of his
current Ph.D. students, David Julian. (His other current students
are Assaf Zeevi, Joshua Singer, Michael Baer, Arak Sutivong
and Jon Yard.) That work incorporates side information, such as
the state of the economy and the price of oil, into the algorithm.
The algorithm is "somewhat ponderous," Cover says. "The
performance of the algorithm, although good relative to the best
portfolio in hindsight, is still slow in responding in an absolute
sense. It sometimes requires hundreds of days before the initial
conditions wash out, leaving the 'fittest' rebalanced portfolio
dominating the performance. It's guiding thinking, but no one's
making money off it yet."
And Cover's algorithm has a catch. It ignores the brokerage fees
affixed to each stock trade. "The transaction costs will eat you
up," he says. This is true even considering lower transaction fees
available over the Internet that improve performance. "But there's
a nice theoretical patch that will allow you to include transaction
costs. You trade only when you get far enough away from the
optimal investment proportions. This results in less frequent
trades, but a lower growth rate as well."
Contact: Stanford News Service Dawn Levy, 650/725-1944 Email:
dawnlevy@stanford.edu or Thomas M. Cover, Statistics and Electrical
Engineering 650/723-4505 Email: cover@isl.stanford.edu
Funny you should mention Robert Redford on the trail today. I keep thinking of him in "Butch & Sundance" (whether it was he or Paul Newman) asking "Who ARE those guys?"
I know we don't NEED to know now -- the great thing about Internet chatting is getting to know someone purely by the quality of their posting -- but won't be just be JUICY to someday know who's been coaching us?
Meanwhile, I think the financial meltdown calls for renting and re-viewing another Redford-Newman flick (probably annually): The Sting. The tune from that should probably be Wall Street's national anthem.
http://www.usagold.comThe rules for a regular IRA say we can't put metal in it. OK so what if I buy $2000 worth of shares in a quality gold fund? And I don't have to trade them either because it is managed by someone else. If sometime in the next year the lid on the metal kettle blows, I'll already be there and all the gains will be tax free* (postponed until they figure out a way to get it). Does anyone see a problem with this idea? Maybe just buy $2000 worth of gold and bury to be merry. I guess I'm after capital appreciation and I'm not just satisfied with preservation.
It would be sad to be in paper gold of any form and see it finally rocket up to simply be halved at tax time.
Passing gold on to your kids, that was the best advice I've heard all day after mulling over these forms. Like a fiddler on a roof. Miss one 1099 or schedule and we trip off the matchmaker. The explanations the IRS gives are mutually contradictory. They always splice in some extraneous qualifier that they never explain. It's getting to where you need alot of guts to itemize. This Lassiter's layman's tax prep phone book would be completely lost in the barrage of complications considering the massive collection of books they could bring forward. Arbitrary law that's what we live under.
If all truth is relative then justice becomes whimsical.
Just thinking of Elian and what he is about to go through. Guess it's difficult for Ms. Reno with all the relatives around. Can't just use teargas and sniperfire afterdark. Not enough flammables around to burn up the bodies to remove the evidence. They can't enforce injunctions like they used to. I think the longer his comrad dad stays in the states, the more pleasant reality he'll be exposed to and with a few invitations to some talk shows......little celebrity status.......if his wife ever sees the inside of a Farmfresh........"Well I changed my mind, we'll become Americans."
My brain is fried on "market crash awareness". Like E=Mc2 except Monday at 1pm. F=MA until the BOJ abandones the dollar prop policy. And V=IR except when the bonds drop through the floor with the dollars.....I promise to go back to gold talk. I know this isn't the Larry King Live. Some of you guys are in a "gold rehash psychosis" but it's ample food for thought. Gold is dead* until Monday at 1:15 when the PPT leaves for a toastchee crackers run. The financial scenario just went into the X Y Z plane and I'm an X Y planed thinker. Z is for time.
Time to get away from the shabby brokerage that says "$7 trades", thieving bass dads, skimming market orders, chronic late confirmations, "the computer never makes mistakes" BS it can't even compute the proceeds from a short sale. I bought $12,000 worth of a gas utility with $3000 in my account. Yeah that's 3000 X 2 then doubled = $12,000. Margin magic....this is no lie. I just rode it wondering when "zee kempyooter" would send me the margin call of my life. One week not bad.
The brokers who "got the good brain" with the twenty stock streamer is fun for watching market meltdown in technicolor. At certain times when the computerized selling hits it blinks red, reminds me of Christmas-tree lights. It's not junk, I caught the PDG rally cold within the first 10 minutes of its rocket ride. Some traders put their slow steady money into a myoochewal funds but not me. Physical gold, can you dig it? Dig, bury, naaa move it.........dig, bury, naaa move it. It's not back there because you moved it all over here, Oh that's right it is all here.
You can put metal in it--999 bullion and US bullion coins. The problem is finding a custodian in your neighborhood and not being far away holding only a receipt.
http://www.SelectSectors.com/ag_xau_gcmx.gifThe below chart compares Select-Gold, XAU and Comex-Gold.
The curves are plotted on a percentage basis, so the premium that the Gold stocks enjoy over bullion may be compared over time.
The chart shows when this percentage premium shrinks to the bullion level, a strong Gold stock rally follows.
When it goes below the bullion level, it's time to
mortgage the house and go long.
http://www.usagold.comAfter the markets closed on Friday I called my local coin dealer and ordered 10 Au Eagles. Locked in at $293 and he had them in stock! What a deal. OK so I have to write a Visa check to cover the purchase. We all know the old saying "Put your money where your mouth is" Buy physical until it hurts and then buy some more. A true Goldbug is proactive and will not allow others to manipulate them. Smile and have a good evening. BUZZZZZZ
I wish I could tell you a way to get through to people, especially your family members, but I don't think there is a way. You hit on something--salt away enough physical to take care of your whole family if you can do it. You can bet they'll come to you when circumstances prove them wrong. What are you going to do? Turn away family? Not likely.
The myopia re: gold is similar to that regarding a whole host of issues, particularly the erosion of the Constitution. Try convincing the average shmuck why they should be concerned about efforts to prevent them from owning guns, or any other so-called "right wing" issues. You get the same incredulous, brain-dead stare.
It's a sad fact of our nature that we refuse to believe the evidence, often until it is too late. Be like Noah--be too busy taking care of you and your own, based upon what you know, to be hurt by the rejection of others. They'll find out soon enough, and you can only be responsible for those closest to you! It was the Savior's job to bleed for mankind, not yours.
I was at church and got a really funny feeling that something was going to happen in June.
It's a really nagging feeling.
All I know is it makes me want to purchase more metals.
Saturday Afternoon:
I went down and added to my silver pledge today. The dealer had seven 10 oz. bars for sale. I would have taken the whole lot, but had to pay off a credit card bill. Was limited to getting only three bars, and a Gold Eagle.
I think I have my required 100 ounces, but will continue to add as finances allow.
http://www.egroups.com/message/gata/435?Reg Howe examines the data about the impending
Swiss gold sale and concludes that, far from
knocking gold down, it will merely cover the official-
sector gold lenders in the euro area against default
by the borrowers and clear the way for the liberation
of the gold price from the chains of paper derivatives.
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:
It seems to me that too many are thinking the end of the bubble is here.
Lets put this in context, the DOW only fell by 5% on friday,
not even close to the 20%fall of 1987. Also consider that the DOW rose by 500 points in just 1 day a few weeks back.
I dont think the Fed has lost control just yet.
I hope Im wrong
Good morning esteemed USAGOLD friends. Below is a draft of an email that I wish to send to a friend today. Does it make sense? I am looking for confirmation before I send it.
The attached graph very clearly explains to me why 'markets' have gone up in the last few years. There comes a time when 'leverage' maximizes to an endpoint. Now investors must deal with 'margin' calls.
It is speculated (and I hate that word) that heavily 'margined' investors must sell-off even further to pay back borrowed money that fueled this bull.
The question arising on financial sites overnight is whether 'new and qualified' money exists to bring back the bull. Money must pour back into the market quickly (to stabilize) or this thing is going to get super-ugly.
This thing can go either way. Apparently the FED is in a catch-22. It can pour money into the affair to stop the crash (now beyond correction) which will lead to US dollar insolvency; too many dollars create a diluting effect while not supporting markets will further the crash (no money poured in). Imagine standing in Summers or Greenspan's shoes this week-end?
Yes,Canuck,it MAKES sense.I look at me:I even didn't have any margin calls, and to prevent that I will sell my leverage (and this is now only Goldstocks!"they will sell all papers"(FOA),hello!And what did Tiger Fund ???).I dont wanna get behind the curve (like others at the moment).Yes, I will and already did buy Physical!
Your words on Greenspan "Imagine standing in Summers or Greenspan's shoes this week-end?" kept me thinking.
WHY? why does AG do that? Steering the Titanic ? He doesent have to .
I couldn't find a plausible answer, exept: honour!I wish him well!
Would anyone comment on setting up a wealth savings account for a twelve year old child?
He has several hundred dollars to exchange for wealth tomorrow. I favor it all being exchanged for physical gold but I have read alot here about diversifying investments even for gold advocates. The countering point of view in our house wants at least some of his dollars to go into a passbook savings account.
The question in my mind is the appropriateness of teaching diversification or is this the wrong time to be concerned about that and go for teaching protecting it all with gold?
Date: Sat Apr 15 2000 22:41
goldfever@k-online.com (an EENIE, MEANIE, MINEY, MO; who are the forked-tongues, the true; among me
and you?) ID#432170:
Copyright � 2000 goldfever@k-online.com All rights reserved
An EENIE, MEANEY, MINEY, MO; who are the forked-tongues; the true?
Your are asked to the consider the following 3 or 4 entries; from Ayn Rand, myself, and Mr. Greespan..
FIRST, EENIE:
from Ayn Rand; an excerpt from her novel, ATLAS SHRUGGED, as republished in:
"WHO ARE TO BE THE NEW INTELLECTUALS"; 1961, ( For The New Intellectual ) :
"Whenever the destroyers appear among men, they start by destroying money, for money is men's protection and the
base of moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective
standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an
equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who
are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs; upon the virtue
of the victims. Watch for the day when it bounces, marked: 'Account overdrawn'. .."
SECOND, MEANEY:
My internet post of 02/09/00:
Date: Wed Feb 09 2000 10:31
At the precipice - the NASDAQ CRASH�
( Note: as of 02/09/00, the Nasdaq June Contract was trading about 3900-4000. As of Friday, 041400;
it closed at approximately 3217; about an 18% correction. ) As of 02/09/00, I internet published/wrote:
"US Stock Indexes, and the NASDAQ, are on the edge of their inevitable precipice.
The NASDAQ CRASH will be the pin that pricks the bubble.
The U.S. stock-market-trojan-horse is within our midst.
A bear market for the US equities markets is the elephant in the living room.
It is the iceberg that is about to strike the hull of this Titanica-America economy and nation.
The lifeboats will be found in gold and silver; and there are not a lot of them to go around.
They are still bargains, going for a song.
One day soon, within the next few years, everyone will be trying to scramble into them;
and they will be very dear, without enough to go around.
Meanwhile, the masses are convinced we are too big to sink; too big to fail.
Like legions of lemmings, like the blind led by the blind; over the cliff, the precipice.
Hubris pays a dear price.
These are the worst of times; and the best of times�"
THIRD, MINEY:
Grenspan, in his carefully worded 0217 Humphrey Hawkins address, assigned responsibility and
his feigned concern, as if the 'problem' was/is of "productivity"�.was the root of this
devil of 'aggregate demand'.
FOURTH, MO:
Come-ON, Mr. Greenspan, when was success - 'productivity' ever the real problem?!
As supposedly creating a too-exuberant economic 'demand', threatening "inflation".
OK, enough already. Could any government politician, or leader scarce, yet rise to this crisis and equation; and admit
that� that just perhaps the panicked largess of a ready and easy bank-credit generator called and named as our Federal
Reserve Banking System; with its obliging club of Federal Regional Governors,
So oh so supposedly worried, while yet omitting responsibility for their eagerly generated easy bank-credit and monetary
largess, a monetary cancer crashing and suffocating this other wise honorable nd creative nation and land. For, from the
caverns of legalized counterfeiting government printing-presses;
and the holier-than-thou sanctioned 'Federal Open Market Committee'.
Now really, Mr. Greespan, et al.; could these be but your government sanctioned deliveries of a den of thieves, of fiat,
deception, and gradual slavery seduced democracy?
Are the fiat fueled leaders and governors of our nation but erudite wolves in sheep's clothing indeed, in deed. Is Wall;
Street's manipulating greed of "buy, buy, buy", but their fuel and fire and necessity?
Could these be, what Ayn Rand identified as:
"Whenever destroyers appear among men, they start by destroying money, for money is men's protection and the base
of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective
standards and delivers men into the arbitrary power of an arbitrary setter of values."
So, now� dear reader, you have these three choices, or for Rand, Grenspan, and me, and MO.
But the real choice is unlimited, and within you. Will you continue to live, obedient to this paper-money fiat reigned
nation, of inevitable crash and ruin and servitude; will you go blindly into the guillotine and slowly persuaded sleep of a
sheepish, shorn, credit induced, debt-shorn nation; and into a global economy manipulated, controlled, and careening
into increasingly volatility, crash, and cancerous credit's inexorable debt; where fear, and rule�
are used for the advantage, greed and comfort of the few; and their suffocating rule;
while millions, living, and long since, have been sacrificed, for governments and their wars;
yet supposedly honorable, and honoring, for the sake of liberty, and the sanctity, and innate, essential, eternal rule, of
each and all humanity.
Yet by an ever less polite, gradual and disguised, greed and exploitation;
Would we allow ourselves to surrender to an other's control; is this your false god?
Would you sacrifice your dignity and economic freedom and destiny; would you abandon your children to their triumph;
the rule of central bank governors, well supplied by secret and special interests galore; abandoning discreetly, their
democratic responsibility. Will such paper money masters of fiat's subtle device, deceive you even yet?
Would the democratic middle-classes of our increasingly unstable, frightened world,
really surrender their birthright, heritage, and daily delight in �. just to live, and breathe courageous,
and industrious, and delightfully free.
Such is the harangue, and harbinger of inevitable collapse, of a nation, and civilization, ruled by the convenience, and
tyrants, of fiat money and credit; a nation on full of hollow cymbal, and
tinkling brass.
as his supposedly primary concern, leaving him no considered judgment and governor of choice, than gradual tightening,
of rates, as in his voice.
Conveniently omitting the unbridled profusion of bank-credit that he did engineer and master-mind,
along with fellow governors of Federal Reserve Fiat Money Master and kind, in cooperative concert and agreement, all
of fellow-fiat propaganda and myth and lie, and perhaps even, of deluded mind. He did address no such largess, or less,
than our very own Senate and House of Congress, to be sure; as he did feign to insure against any untoward trouble, that
might would otherwise be encountered, if per-chance the public let-go its misplaced confidence and ( mis-placed ) trust,
in this Titanica-America economy, about to strike the cold reality, that a fiat money and credit civilization, must,
inevitably, go bust; and sink.
Productivity has it's limits, in exhaustion, and hyperbolic's infinity; and how do you tighten a swollen bull market of
runaway excess, politely, with any interest-rate-increase-of-gradual-sharpening-needle, even Geenspan's.
He would rather, only postpone, one more time again, the inevitable day of reckoning;
the inevitable; as last postponed in the last quarter of 1999, with Y2K fears all and everywhere,
abounding. But now, with NASDAQ crashing, and the DJIA and S&P500 dutifully following suit;
with mighty and deceptive rebounding rallies all along the way�.
Where will the American people allow him, and other leaders of the blind leading the blind,
lead them?
Where will such fiat governments and Fed bank managers galore, engineer us too, nest, in slow-motion annihilation of
liberty.
In their pretense and fiat and rule, of wishful thinking, and of pretended "soft-landings",
Can they really pretend to get us to buy their bull-hockey of false rescue and fake-mangers, of this
Titanica-America" economy and nation, pretending that it is not sinking, and in decline.
How many of us will still, yet buy into this myth of:
" Hold those long-term stocks and funds; for your retirement.".
I would suggest, for a retirement, in, and of, fiat induced, and guaranteed poverty, even slavery.
"But of course hold-on; for you were sold them, by the fiat masters; in government, in central nak generators of fiat
chambers, in masters of Wall St. greed; but we, the people, are the willing, na�ve victims; sheep babbling, and
wandering, our way, then theirs, all, to the slaughter."
Meanwhile, for but one temporary moment and sacrifice, they will live in regal wealth, and triumph supreme; while the
majority hold-on, till forced to sell, an equity nest-egg, and far more;
just too feed your selves, and your children.
Will the American people ever wake-up in time, to refuse the encroaching, on-rushing rape, deception, and riot of fiat's
inevitable dictator of an inevitable police-state of seeming necessity replacing democracy? Will our complacency, apathy,
blind trust, naive, leads us like lemmings into the inevitable chaos, and collapse of fiat driven investment markets and
economies of unbridled, unlimited, easy credit and debt;
crash and ruin?
Might we yet, this once gold and silver money free and fair land, wrest national independence and sovereignty, from the
paper money tyrants of manipulation, deception, and international-corporate and globalist world-banking interests, who
politely disguise their and themselves, these masters of greed, domination, control and exploitation.
Will the flame of simple, human dignity, and passion for liberty, re-ignite the fire of individual courage, national and
collective refusal of this subterfuge of fiat; and re-uniting to mutual respect and honored, equal-moneyed trade among a
cooperative world community, in time; to stop these fiat tyrants, before such unbridled greed and plunder, so quietly
disguises yet, their ravage of our nations, and plunder of peoples, tribes, and earth. Will we delay, and default too long,
and momentarily convenient, desensitized; to our own impending demise, and doom.
Would we sacrifice ourselves, beyond redemption and renewal; lest before we have shattered an ever renewing,
re-claiming, healing planet most exquisite and beautiful, this earth; we must wake-up, take the risk, seize the gauntlet,
insist, that our fiat money economy of unbridled greed, be constrained, and re-balanced, and renewed; may we be
redeemed, in time, again, and for always.
Sincerely yours,
David Blair Macrory
Essene@k-online.com
Goldfever@k-online.com
It's Sunday morning here in New England, wife's working and it's raining so I reread what I had underlined of Ravi Batra's book. It's becoming easier to understand as the forecasted events are now unfolding. For those who believe the dollar must weaken to allow POG to rise, Batra states (page 152),"When the DOW plunges, the dollar will fall almost immediately." I think A.G. was trying to tell us last week that he doesn't see his job as an obligation to support share values but he will try to defend the dollar (my guess).
Concerning gold Batra writes (page 180) "Gold is unlikely to lure many experts until the monster of inflation becomes visible. The metal may remain lackluster for a while even after the markets keep sinking. In time, however, as the dollar continues to shrival, and deflationary expectations are reversed, it will make a move. That may be the right time to get into gold stocks. The best strategy may be to keep an eye on the price of gold and related stocks as the market begins to crumble. If the bullion and company stocks respond immediately, then it is time to start buying. For those who like to take action in anticipation of an event, right now is the time to go with the glitter of the coins but not the related shares." He's been on target with most everything he's predicted although his timing is off just a bit probably because Y2K was a non-event. He does not dwell on precious metals very much other than to list them as a means to survive the depression he forsees. Mostly he what the problem is (the bubble), how and why it was created, how and why it will unravel, and what the results will look like. It all ties in with a great deal of what we've been talking about here for a long time. Predictions for next week? From Batra, if the DOW contiues to tank, the dollar goes with it. Also, investor sentiment will eventually turn to gold. My opinion- very soon.
For those who have been following Ben's predictions at gold-eagle, he's calling for a limit up move for POG, FOR THREE DAYS!! for next week! I'll be dansing in the streets if he's even close to being right. As Charles Kuralt told his co-workers when recruiting them for "Sunday Morning", We're going to have fun!
Us goldbugs will tend to have positive expectations for gold bullion behaviour tomorrow.
Perhaps it is important to remember that the majority of market players (and here I exclude goldbugs, since we are a tiny minority), are always wrong.
I believe that the majority clearly anticipates a Black Monday. If this thesis is correct, that the majority is always wrong, it can be so in either of two ways. Either a rally in equities ensues rather than a plunge, or there will be an even more extreme decline than what is already anticipated.
Whatever transpires in the general market, goldbugs are not exempt from this thesis, in that the anticipations of the majority of goldbugs will also be wrong.
Your words: Would anyone comment on setting up a wealth savings account for a 12 year old child?
If it was my child or grandchild here is how I would handle it, to please the whole family.
Put 1/2 of his/her savings in the safest highest interest bearing account available.
Put the other 1/2 in real Gold coin.
At 12 years old he/she should be able to do the following:
Get a notebook and make an entry with the date of deposit on one page for the interest bearing account. Have him/her make an entry with date each time interest is received(monthly, quarterly etc.)
On the next page of the book write, Precious Metal.
Have him/her write in book date of purchase and cost in local currency.(hint: 1/20 or 1/10 ounce Gold coins are available)
Then have him/her enter on a weekly or monthly or quarterly basis the value of the Gold, in local currency.
On the third page of the book pick some items(such as gasoline, food, or whatever) and see how much can be purchased first with the paper savings and then with the conversion of the PM's.
The object of the game is to see which asset gains in purchasing power over the LONG TERM. Have fun!
A history note for the 12 year old:
Despite stock market crashes,wars,depressions changes in type of Government, or any other calamity, what old originally European and now worldwide family has continued to prosper to this day?
Answer:
The Rothschild family,holders of physical Gold throughout the ages.
.....beesting.
Here is my concept of an investment plan for a youngster.
I have a 13 year old daughter and have set up a checking account, brokerage account and a small collection of metals for her. I try to get her involved on investment decisions. She also contributes to these investments whenever possible. At some point this will become her portfolio to manage. It is also very important for her to learn from mistakes as well as victories.
It is my hope that she builds a profitable, part-time, personal investment program affording her the freedom to pursue her dreams (although they may not financially pay well). It is so sad to see people choose to make money rather than pursue dreams.
Her advantages are time (getting started now), education (both in and out of school), discipline and enthusiasm.
I hope these ideas are of value for you and your 12 year old.
http://www.usagold.com With the market crashing, NASDAQ down more than in 1987 and DOW down less than in 1987, and inflation rearing its ugly head as well as POG at relatively depressed levels, thinking Investors who dont have a portion of their assetts in Gold will begin going that way in my opinion.
What Farfel says about Bonds having to tank may be true, but my common sense tells me that conditions are enough to see at least some investment dollar heading toward Gold. Perhaps what we will see is a trickle becoming a creek that flows into a river of investment dollars going to Gold.
Trouble in FINANCIAL LAND means some will head for the security of gold. Im glad I got my physical.
Wasn't easy to find, but here's the first I found:
Wisebeard...�
(Ben)
Apr 14, 14:15
Right now, I know that a MAJOR support area has been penetrated. 10730. I was waiting for that to happen as I have mentioned numerous times. That tells me a lot. The probability of the Dow taking out the low in March of 9600 and change is very high. I would project this happening possibly next week before the holiday (how convenient). I won't know much more until the markets close the data is crunched. The last 30 minutes today will tell us a TON.
The Nasdaq is in CRASH mode. Regardless of what or how CNBC spins it, the Margin Madness will unfold early next week if we don't get an EXTREME rally soon.
Don't worry about GOLD just yet....We're close. How does $510 an ounce in a matter of days of the intitial explosion strike you? IT'S GONNA HAPPEN.
This morning I read with anguish the words of Marius 28735.
SNIP
It's a sad fact of our nature that we refuse to believe the evidence, often until it is too late. Be like Noah--be too busy taking care of you and your own, based upon what you know, to be hurt by the rejection of others. They'll find out soon enough, and you can only be responsible for those closest to you! It was the Savior's job to bleed for mankind, not yours.
UNSNIP
As I understand the progress of the "Passion Play" it seems to me to be more in the way of a tragic lesson taught to mankind by none other than the Savior Himself in full sight of God and everyone. With His lesson we are shown the "way to eternal life". It was not His "job" but His choice to ask forgiveness of mankind (His tormentors)and forstall the wrath of the Father.
It is a story of a mankind who when presented with a choice, offered up the innocent at the behest of urging by a vocal few in the paid service of those in power, and let the common thief go free.
Sadly, we are now at the threshold of witnessing this play unfold before us again. Perhaps it is by Divine providence from a most merciful source that we will soon be unburdened of the incredible indebtedness that extends beyond our lifetimes and into those of our grandchildren. Accrued by agents of deception and betrayal.
But once again we will be given a choice. Perhaps this is the next to final test of mankind...to see if at least some of us with a voice of reason...will speak up this time and deliver the thief rather than the innocent. Some things never change. The innocent will be offered up and the thief will walk free.
The innocent in their torment too will then need to make a choice in perhaps what is to be the final test. Have we learned the true meaning of the greatest gift we ever received. To choose "the sword" or "forgiveness". They will seek among them the "Judas Iscariot". They will see Ceasar wash his hands of innocent blood. As God almighty is my witness, I sincerely hope that the choice is "forgiveness".
Why The Sell Off On Wall Street Probably Has Further To Go
Forget about the fact that Cisco still trades at 158 times earnings or Qualcomm's PE is still above 250. There is a much bigger reason than just overvaluation why the bear market is not over yet. Call it complacency.
On Friday, Ameritrade released their customer trading statistics for all of last week. Amazingly, the retail investor was heavily on the BUY side every day. On Thursday, in fact, more than 80+% of Ameritrade's orders were purchases.
No wonder. The novice investor has learned over the last several years that every decline should be bought. But this decline is different in a very significant way from ones we have all grown used to. This one is the result of a fundamental shift in economic conditions that has been building behind the scenes.
The stock market bubble, the ballooning current-account deficit and the excess consumer spending of the last couple of years; all were children of the same father, to wit: overly accomodative monetary policy. And, as we have discussed for many months here at the forum, all of these phenomena lead in only one direcion: inflation.
But, if that is true, then stock market speculators (such as Ameritrade's customers) are still woefully misallocated among stocks that offer no upside in times of rising consumer prices. And nothing in last week's trading figures would indicate that this issue has yet to be addressed. Yes, oils held up well. So did REITs. Goldminers even rose. But none of this relative strength in inflation beneficiaries evidenced anything like the sea change in investor psychology which will be necessary before the market finally bottoms.
Perversely, government bonds even ROSE yesterday. Perhaps that is just the proverbial flight to quality. Or maybe some expect a serious decline in stock prices to rein in the consumer and stop inflation before it starts. I don't know. But clearly, for all the handwringing going on, there is still too much complacency given the very fundamental economic shift taking place. Just ask Ameritrade.
http://www.usagold.comSounds exactly right to me. PPT is going to run out of ammo and will try to encourage others to support the markets. Greeny will pull the plug on the PPT if the dollar drops too far. "Act like you've got bullets! Fire a round off every once in awhile." Meanwhile the drunken flukers crowd around the stern of the ship where the only fish being seen is the stuff they cut for bait. "Well when is the rally going to hit". "Keep waiting I'm still cutting bait". "Great news everybody, the first mate, Greeny's son Bill, is cutting lots of bait, get ready. Hook on one of these little strips of propoganda and go all the way to the bottom with it. Don't use any weight. We're in 120 ft. of water, this is going to take awhile.......................ho.....hum.
Actually we have a goldstock rally already begun. Large cap gold producers just saw the beginnings of Institutional sponsorship. Small investors don't bother with low beta large cap gold. Those are long term players, defectors from the Club Barrick going long safe gold. Expect a major rally in papergold first moving toward BIFURCATION of paper and physical markets.
The loud "CRACK" was just heard on the frozen pond. "But we are in the middle of a hockey game". As a few of the players leave the others know the ice is dangerously thin (liquidity). Stubborn mockers go back out and skate around awhile and more join them (1 week reprieve rally)................the thin puddle of water glistens on the pond. It's such a nice day for a "Correction", "Sure glad it's not a crash", "No, couldn't be a crash". "The sun is too bright, it's only 11:30". "We can skate on it all day just move around the water."
I agree, all signs point to a sea change taking place in equities which few seem ready recognize.
We've been in an extremely overvalued market since 1995 (I call the period from 1995-2000 the "SuperBull"). This situation was always known to be unsustainable by any thinking, rational market watcher.
So, where are we, and where are the important levels on the major indices?
Let's start with the Nasdaq Composite. We closed Friday at 3321.29, a correction of over 34% from the March 10th closing high of 5048.62. The uptrendline of this SuperBull move has been severly tested twice - in April 1997 and October 1998 (actually broke below in '98 for a short time). Is there any doubt that NOW is the time this trendline will once again be tested? The money flows look absolutely atrocious and even Microsoft is seeing extreme distribution.
In addition, the economic and monetary situations have reached the limits of viability.
OK, how low do we go to test this line? I hate to be the bearer of bad news folks, but that line runs right around 2500...nearly another 25% below Friday's close!
Do I expect the possibility of at least one sharp, viscious, counter-rally before then? Yes, of course...but even IF this happens, I'm still looking for 2500 on the Nasdaq Composite before the end of May...that trendline WILL be tested.
But that's only the first part of the story. As I said, this SuperBull is unsustainable, and I believe it will die this year. I see two scenarios here...we test the line by the end of next month and then stabilize into mid-July before finally breaking through, or we crash right through the entire thing as snowballs get bigger rolling down the mountain. Right now, I'd say the timetable is up in the air.
Oh, when the SuperBull trendline is breached for good on the Nasdaq Composite, say hello to 1500.
Dow Industrials closed Friday at 10,305.77, a correction of over 12% from its January 14th high of 11,722.98. The Dow never fully got back on the SuperBull track after the Fall '98 correction (money was drained into more speculative Nasdaq stocks), and has been trading below the SuperBull trendline for some time. The problem is that it is also still very overvalued. The Dow could fall to 8500 (a 27%+ move down) and we would still be in the secular bull market which began in 1982.
Historians who study the history of the greatest experiment in freedom ever endeavored will recognize that the American Revolution (the "battle of independence") was finally lost on a day in 1913 when the Federal Reserve Act was signed into law illegally.
At that time, a period of great global conflict commenced...a grab for the resources of the old world (much gold also changed hands) by violence. This (perhaps not so chance) series of occurrences had the effect of diverting attention from what had actually occurred in America in 1913. It has taken another 90 years, most of it spent in violence or under the threat thereof, for the fact to have become apparent to some. It will only be a short time longer before it is readily apparent to all.
If real wealth, due to its growing scarcity (if for no other reason than the continuing birth of billions who must share it) is an appreciating asset, then debt to borrowed real wealth should be repaid as quickly as possible. The longer the debt is carried the greater the ultimate price of squaring the account.
This is fundamentally different than the borrowing of an instrument of continually inflating basis. That debt is best serviced at the last possible moment with the greatly inflated substance. Inflated to the point that its substance can no longer be recognized by those who created it and were supposed to safeguard its integrity.
This year we have seen the guardian of all we held sacred (mostly our solemn word) tell us that he no longer can tell us what these vouchers for our integrity mean anymore.
These chits that lately surfaced on that great poker table out there say on the face of them that they represent the good faith and credit of American taxpayers that are yet to be born.
These are times that try men's souls. Alan's soul is forfeit. Perhaps he will be best remembered for his words that invoke a nostalgia for the days of the gold standard of accounting. In voicing these words, I see him figuratively washing his hands of the blood of the innocent and even of the blood of those yet to be born...for their innocence is sacrosanct...and we the living have betrayed it. It is in fact a line not to be crossed. Far worse than crossing the line of indebting those whose forced labor we would find repulsive...the children of this nation.
This in fact has been done unbeknownst to the sheeple by selling our debt 30 years into the future. I say it is a travesty. Those who were to govern us have become our oppressors. Tyrants in the name of a bluff at a poker game we did not even know we were in.
Can we in fact declare the Federal Reserve Act to be unconstitutional and hence the indebtedness represented by it uncollectable? Can we return to a constitutional currency...free of encumberment from all manner of ill doings? These FRN's represent the military industrial complex...the war machines it is engaged in creating as well as the great (welfare) society of Roosevelt and Johnson. A "productivity" crisis??? I'll say there is one. After all, who the h*ll feels like working when you can easily feather your nest by sitting in front of a CRT all day exchanging gambling chips with your neighbors while the government doles out more and more of our grandchildren's future earnings to keep the game afloat.
I hereby vote to forgo my piece of "American Pie" my entire stake in the Social Security Ponzi scheme...if I could only be free of this burden of crushing international debt created and nurtured by bankers both foreign and native to our soil.
But then its just not that easy is it? There must be pain. And there will be a new generation of Paine(s) as well.
It is not the fault of the BIS nor the ECU although they will be demonized for us by the pundits. After all they only seek to return some semblence of accountability to the world of international finance. No the culprit is amongst ourselves. It is partly greed and avarice...our desire to get something for nothing. The other part was the deception of those charged with the safeguarding of our future. I now recognize that even upon my birth, their hands were tied and their mouths were gagged and our fates were sealed in 1913. They are no more to blame than ourselves.
So where am I going with all this? When they pass the hat for the common sword to wreck vengeance upon those who would oppress us. Demonized as they will be by the popular media and administration...just say no. We now see the enemy...and he is us. A new declaration need be at hand. One that establishes freedom for not only ourselves but for our children and their children. Ironically, it need not dismantle what is in place and been shown to work. It need only discredit all that has transpired since 1913.
Early Overseas Market Indications are Bearish for Monday...
Spectre of Black Monday
April 17, 2000
By LACHLAN JOHNSTON
The sharemarket is bracing for one of its worst
days since the October 1987 crash, with the All
Ordinaries index expected to plunge by as much
as 150 points today as investors run for cover.
A record 617-point fall on Wall Street's Dow
Jones index on Friday night has left investors and
brokers nervous about the Australian market,
which will be the first major stock exchange to
open for trading since the plunge in New York.
The much-hyped technology stocks are expected
to lead the sell-off after Wall Street's Nasdaq
index plummeted almost 10 per cent on Friday,
but "old economy" stocks such as the banks and
Telstra are also likely to suffer as shareholders
seek lower-risk investments.
The local market will also feel downward pressure
from its largest stock, News Corporation,
following news yesterday that its executive
chairman, Mr Rupert Murdoch, has been
diagnosed with prostate cancer.
Bond markets, which traditionally serve as a haven
during sharemarket turmoil, are expected to surge
but short-term pressure on the Australian dollar
caused by the downturn is likely to increase as
overseas investors pull their money out of the
sharemarket.
The market plunge will also affect upcoming
market floats, possibly including the $10 billion
Vodafone Australia float, Mr Kerry Packer's
$600 million CPH Investment Corp raising, Mr
Murdoch's mooted $US36 billion ($54 million)
Platformco satellite float and Amcor's float of its
paper division.
Experienced market watchers were yesterday
urging investors to be cautious and not to
"panic-sell", but admitted the market faced a
difficult period in the days before Easter.
Perpetual Investments' head of equities, Mr Peter
Morgan, said the sharemarket and the economic
conditions were substantially better than in 1987.
"If you compare it to 1987 you have better
management in the majority of companies, and
there are nowhere near as many overborrowed
companies," Mr Morgan said.
"Countries that have been relying on their
sharemarket for economic growth will definitely
have a problem, but Australia has relatively strong
economy at the moment."
Mr Paul Rickard, who runs Australia's largest
retail stockbroker, Commonwealth Securities, said
the Australian market was not as overblown as the
US markets, which would provide a soft landing
for local stocks.
"I don't think you will see a barrage of sellers [this
morning] because there will still be a lot of
nervousness about what Wall Street will do when
it opens on Monday night," Mr Rickard said.
"When you see these types of big falls they are
usually followed by some sort of bounce.
"It may not happen tomorrow, but I think there will
be a few people looking at this as a buying
opportunity."
On Wall Street, the Dow Jones Industrial Average
fell 617.7 points, or 5.6 per cent, to 10,305.7,
while the Nasdaq market plummeted 355 points,
or 9.7 per cent, to 3,321.2.
The tumble followed the release of unexpectedly
high US inflation data, raising the spectre of further
interest rate rises which would hurt the market.
The turmoil in the New York markets was
mirrored in unrest on the streets of Washington
DC, where police arrested 600 protesters on the
eve of the spring meetings of the World Bank and
the International Monetary Fund. Finance ministers
from the G7 nations discussed the falls on Wall
Street in meetings over the weekend.
The Nasdaq's 355-point fall is the largest points
fall in its 29-year history, but is still less than the
1987 crash in percentage terms. It fell 11.35 per
cent on "Black Monday", October 19, 1987.
Friday's 617-point tumble is also the largest points
fall for the Dow Jones Industrial average, but the
5.6 per cent fall is still eclipsed by those of
October 19, 1987 (22 per cent) and the 1997
mini-meltdown (7.2 per cent).
But it bore a strong resemblance to the 1987
crash, when the Dow Jones fell 4.6 per cent on
Friday, October 16, before the 22 per cent fall on
the following Black Monday.
The Australian market did not suffer the crash until
Tuesday, October 20, as the aftershocks of Wall
Street's Black Monday spread across the world.
Analysts said a "crash" today was unlikely, but a
long-term "bear" market - in which stocks fall or
stand still - was possible.
[From SYDNEY MORNING HERALD, Fair Use For Educational/Research Purposes Only]
http://quote.yahoo.com/m2?uNew Zealand the first market to open Monday appears to be down 5%'ish after nearly one hour open.
Some of these Australasian markets have been flat for 3 years and with a large foreign ownership component this does not bode well for the S&P500 unless you're shorting it that is.
A couple of weeks ago you posted on Yen strengh. I posted a reply, that after I read it realized I had the thing all out of context. I apologize to you for the abrassive tone.
Credits go to nomercy at Kitco discussion site for providing the link.
Date: Sun Apr 16 2000 18:16
nomercy (THE COMING RISE OF THE EURO= falling US $= higher US inflation) ID#207145:
The next major move in the currency markets is likely to be a substantial appreciation of the euro. It will probably take place over the next six to twelve months. There are four major reasons:
the substantial underlying undervaluation of the euro;
a focus on the euro during the next leg of the fall in the dollar that is inevitable due to America's huge and growing current account deficit;
the beginning of a substantial portfolio shift into the euro as it asserts a major role in international finance;
and a pickup in European growth coupled with an American slowdown.
There is a possibility that the rise of the euro could trigger, or be part of, a generalized decline in the exchange rate of the dollar. That fall in the dollar could in turn push up US inflation and interest rates, thereby drive down the stock market, and imperil the continued expansion of the American economy...
Thanks. no real apology necessary my friend, no offence taken.
Some real interesting times ahead in the two weeks on the markets with maybe some history in the making.
Thanks . I had checked that site, but the June quote I dont get. Futures, dont know much about. I hope to see the price of gold much higher than that by June. Would I bet money on it .....no. I hope to see it ( gold ) move higher tonight. The question is if it does move up , will NY kill it in the am ?
Sorry Peter, I missed your post. Never too much to make the obvious apparent, the markets are in big trouble, or so it would seem. Hear on the Radio (ABC News), that the market won't hurt the economy. We can sleep well.
NASDAQ 100 futures limit down
circuit breakers being tripped in Tokyo (halting TOPIX trading)
All major Asian/Australian indices down hard
US Treasuries firm
two apparent interventions so far to support the dollar by the Japanese and British (or someone on behalf of their currencies)
Gold up 2.00 +
Trail Guide, is this what you meant when you said in your week's posting "very very close"?
http://www.usagold.comHello, Hello: all my friends at USAGOLD, please wake up! History in making right in front of our screen. I need all you guys to give blow-by-blow analysis. I need knowledge, assessment, and prediction. And above all, some entainment.
http://www.usagold.comI'm so sure that another trillion will evaporate in the equity markets tomorrow that I am inviting all posters and lurkers out to dinner. It will have to be McDonalds. The rise in precious metals prices will allow me to do this for you all. Smile and have a good evening. BUZZZZZZ
Sunday April 16, 9:14 pm Eastern Time
June Nasdaq 100 futures fall to overnight limit
CHICAGO, April 16 (Reuters) - June Nasdaq 100 futures fell the overnight limit of 110-points on Sunday night GLOBEX trade, following through on last week's steep sell-off as Asian stock markets eroded, traders said.
The Chicago Mercantile Exchange contract that reflects the largest of the large cap technology stocks in the Nasdaq fell the 110 points allowed for overnight trade to 3,107.50. The contract cannot trade below that level until the pit session opens on Monday morning.
I'm glad I'm not the only one out here looking for the price tonight. Maybe the price is rising so high and fast they are scrambling to add enough lines on the chart, and just when they get enough the price goes up again. Time to add more lines!
Hello again. As you might guess there is a lot of private discussion in process now. I just stopped in to say I can't talk much right now. I think Alan just walked away from it all. In effect saying "let it go"! Ah Yes, anyone of size could own the paper gold world now and I think it will be too tempting for some operator not to try. Yet, he will only own a large paper bet for a few days.
I had offered a point earlier that our guys (US) were running out of "worth" to control gold. I think they are truly out of this "political worth" now. This could become a firestorm in a short time?
Elwood, I still have an old posted question from you about the Euro being not big enough yet to settle world oil (and other questions). It's just about there. I'll get back to that.
Also, Cavan Man offered the Goldensextant's latest views. It better puts into perspective how the BIS shuffles gold around. In a deeper thought, they actually control a lot more gold than we think.
Ok, I'm off to the bunker (smile). Watch your "top knot out there"!
NEW YORK (CNNfn) - Asian equity markets crumbled at Monday's opening with Friday's savaging of U.S. stocks sparking selling across the region.
"The key thing is that investor psychology has changed from greed to fear," said HSBC Australia equity strategist John Banos, suggesting there was more pain to come for new economy stocks.
"I think the trend for new economy, or technology, stocks will not only be weaker this week, but over the next three months."
Thanks for that. I think we've got a lot more than 3 months to clean up this mess we've made.
This probably goes without saying, but we're going to hear alot in the next few weeks and months about how the "fundamentals are sound" and such spin from the talking heads. Don't believe it. Our fundamentals haven't been sound for quite awhile.
For most self-employed people, the SE tax (~ 14% on first ~$73,000) is the killer each year.
A corporation does not pay SE tax. An S corporation passes both dividend (profit) and wages to the owner. Only the wage part pays the ~15% Social Security tax bite.
Some S corporations pay their owner a modest salary, say $25,000 out of a net of, say, $75,000. IRS concerns itself with "reasonable compensation" mostly in high-salary C corporation scenario, although they have mentioned being aware of the low-salary S corp issue.
Date: Sun Apr 16 2000 23:11
scorp54 (latest) ID#286323:
Copyright � 2000 scorp54/Kitco Inc. All rights reserved
Palladium Jumps as Investors Seek Security in Precious Metals
Hong Kong, April 17 ( Bloomberg ) --- Palladium surged more than 4 percent as investors, spooked by a slump in stock prices in the U.S. bought precious metals as a safer investment, traders said.
``With the collapse in stocks hot money is slowly going back to precious metals,'' said Gordon Cheung, a precious metals trader at Mitsui & Co. in Hong Kong. ``Money will flow into precious metals in the next 3-4 months.''
Palladium for immediate delivery gained $25, or 4.5 percent, to $585 per troy ounce. It has declined 26 percent from a record high of $795 in February when concern about supply disruptions from Russia pushed the metal higher. Russia is the world's largest producer of the material used in car exhausts and mobile telephones.
Asian stocks collapsed, led by Internet-related companies, after the U.S. Nasdaq Composite Index, dominated by phone, computer and Internet-related companies, plunged 9.7 percent on Friday. The Nasdaq fell after the biggest pickup in U.S. inflation in more than five years last week saw investors sell Nasdaq shares that are priced way too high based on earnings potential.
Japan's Nikkei 225 stock average dived as much as 9 percent; Australia's ASX200 Index slumped as much as 7 percent while Korea's Kospi index tumbled 2.6 percent, after plunging 9 percent on Saturday.
Gold for immediate delivery rose as much as 0.85 percent to $285 per troy ounce.
It looks like things are getting out of hand in Asian markets. A 40-1 ratio of sellers to buyers in Hong Kong? Wow!
The main question is this: will the madness transfer to Europe, then America?
For some time, I have tried to warn various day traders that, no matter how closely they watch the market...no matter how many STOP-LOSSES they place on their various stocks...if the trigger event to a market collapse occurs OFF-HOURS, then there will be such a line-up of sellers at market opening that the exchange will need to suspend trading for some time, create new equilibrium prices much, much lower than the previous closing prices...so low that most Stop-Losses will be bypassed completely.
Conversely, for some time, I have warned that those investors who think they can board the precious metals train whenever they choose and still obtain cheap prices will likely find that, if a trigger event occurs during off-market hours, then there will not be enough seats available, and both the metals and metal stocks will open up significantly higher than previous closes, at prices potentially several hundred percent higher.
Is Monday to be such a day? Who knows?
No doubt the Clinton government officials are now preparing some kind of plan to preclude total hysteria here in America.
Massive Greed turning to incredible fear on a spin of a dime.
http:// www.usagold.comExcellent! Everybody is here since my " wake-up " call. Even TG gives us an update. Thanks. May I suggest all stay here all night long? After all, how many this kind of grand scale live drama one can witness in lifetime?!
Yes -- Tis only the mid-session break on the NIKKEI
TOKYO, April 17 (Reuters) - Tokyo stocks plunged by midday on Monday, battered by a one-two punch from sharp losses in U.S. stocks and a planned reshuffle in the components of the Nikkei average, traders said.
The business daily Nihon Keizai Shimbun, or Nikkei, said over the weekend it will change 30 component stocks of the key 225-share index on April 24, prompting investors to dump the outgoing stocks in a market already under heavy pressure after record losses in New York.
``The timing could have been better,'' said Hidenori Karaki, an equities general manager at Tokyo Mitsubishi Personal Securities, regarding the Nikkei announcement.
He added, however, that the Tokyo market's underlying uptrend remains intact despite the morning's sharp losses.
``Late last year, most of us forecast the Nikkei to be at around this level at about this time of year. Once knee-jerk selling clears out, buyers will come back to the market for relatively cheap, domestic demand-related stocks.''
At midday, the benchmark Nikkei average was down 1,750.79 points or 8.57 percent at 18,683.89.
===
Looks like they too can change the way to count the AVERAGE.
<;-)
Australia All Ordinaries 2927.9 -168.1 -5.43%
China Shanghai Composite 1796.746 -36.919 -2.01%
Hong Kong Hang Seng 14843.21 -1299.55 -8.05%
Indonesia Jakarta Composite 529.649 -27.139 -4.87%
Japan Nikkei 225 18985.97 -1448.71 -7.09%
Malaysia KLSE Composite 883.44 -47.77 -5.13%
New Zealand NZSE 40 1973.78 -97.18 -4.69% (Closed 45 minutes ago)
Philippines PSE Composite 1634.49 -78.05 -4.56%
Singapore Straits Times 2015.24 -174.52 -7.97%
South Korea Seoul Composite 720.58 -80.31 -10.03%
Thailand SET 390.53 -23.92 -5.77%
Taiwan Taiwan Weighted 8977.54 +110.74 +1.25%
Sydney, April 17 (Bloomberg) -- Gold rose in Asia as investors bet the precious metal was a safe haven and may be poised for a rally amid a rout in stocks.
The higher gold price, though, wasn't enough to bolster Australian gold stocks, which mostly fell in line with the broader market. All 24 industry indexes compiled by the Australian Stock Exchange, including the gold index, declined following the biggest one-day drop Friday in the bellwether Dow Jones Industrial Average stock index in New York.
``We're at a turning point,'' said Peter Arnot, a Sydney- based analyst at investment bank Dresdner Kleinwort Benson. ``The previous 20 years has been favorable for stocks. We're going to enter a period which is favorable for gold.''
Gold for immediate delivery rose as much as US$1.95, or 0.7 percent, to US$284.55 an ounce. It rose 0.4 percent to US$282.60 in New York Friday after reaching a two-week high of US$286.50 during trading as the Dow declined.
``We've had 20 years where fiscal and economic factors have been favorable to entrepreneurs. Now we're finding that maybe the environment for cheap labor is coming to an end,'' Arnot said. ``What we're looking for now is for gold to start to perform with small rallies.''
Among gold stocks in the Australian Stock Exchange's gold index, 21 declined and four rose as the index fell about 2 percent. The biggest percentage decliners included Resolute Ltd., which fell 4 cents, or 20 percent, to 16 Australian cents and Kidston Gold Mines Ltd., which dropped 4 cents, or 13.8 percent, to 25 cents.
AngloGold Ltd., a South-African based producer, led the gold stocks going against the trend. It rose as much as A$1.53, or 7.1 percent, to A$75.53. Newcrest Mining Ltd. also advanced, gaining 5 cents, or 1.5 percent, to A$3.45.
As of Friday's close the S&P and DOW had given up a full year's gain of 12/13% while the Nasdaq, although having fallen 34% has only given up the last five months.
In terms of the averages then, everyone who entered before then is still wholly intact in share value. That is not to say they won't want to get out even tomorrow but only those who bought in the last five months are actually seeing a paper loss. The fear factor therefore may not be as great as other times when markets "Crashed" 34%
This Friday's drop was after Asia closed so today's trading is their catch-up. At this moment the S&P 500 has recovered from 1342.60 to 1348.00 down 19.50 and the volume has dried up. When the heavy trading hits, an hour before NY opens, then we'll know which way it's going.
I think that if the insiders were really casting the world's stockholders to the wolves right here, we would be seeing more than a paltry $2.00 rise in gold.
Not that I would buy anthing else at this moment. (Except, maybe an inex straddle) Volotility there will be!
We are looking for other options on structuring the business to improve tax performance. The initial look at S and C corps brought us to the understanding that improvement is too small for our circumstances.
Banking is obviously a part of government, otherwise there would not have been a tax break on interest - like there is for state and local taxes.
It is ironic that the trigger for Friday's crash of both the Dow and Nasdaq was the CPI report. FINALLY, the spinmeisters could no longer massage the numbers to the point where the sheeple believe there is low inflation. We here at Centennial have harped on this note until we are blue in the face and we are now vindicated. What's next? Upon reflection, it appears that the March 27th - April 3rd timing date for a market high was right on. Steve Puetz's "eclipse theory" was calling for a rally into April 20th when the full moon would smash stocks. That is why it is called a theory. Markets do what they want and when they want. I suspect that tomorrow will be down hard in the morning with a bottom in place by Tuesday. Then a small rally until the end of the week. Perhaps the next wave down will take hold after Easter and the Dow will drop to around 9000 by May 6th, the next new moon. Nasdaq could see 2500-2700 by then. So much for all of the neophyte investors who have populated the front counters at Charles Schwab, Waterhouse, et al. This "correction" (a la CNBC) has erased $2 trillion of market cap so far. Do I hear $4 trillion?
The big question: How long before the battered and bloodied stampede into the gold market? My guess: not long. I talked with an old stock broker friend last week who warned me that the next crash would exceed 500 points and would be perhaps 1000 points. His take on the whole matter: tulip mania has arrived and stocks will crash soon. I asked his opinion about gold. He said it would attract lots of money but that the government would end of confiscating it because it will have no choice. He intimated the crash could unleash some nasty surprises. And this is from an old-school stockbroker who made his multi-millions in stocks the last 30 years.
Thanks, I was glad to get that into the Hall. I see it as a good tool to think with. I am constantly amazed at how often people are unaware that their stock shares are only, in the final reckoning , an auction chit.
Peter Asher (4/16/2000; 23:14:29MDT - Msg ID:28811)
Right on about the current situation being catchup to Friday's action.
However, from what we've seen of the Fed tightening so far this year and the liquidity problems that has spawned, my guess is that this bull market is now over. I think the dollar price inflation will accelerate. By any traditional stock valuation method we've still much farther to go on the downside.
Australian Gold Stocks Down = A Good Omen for Gold
Most of the Australian gold stocks are so heavily hedged (betting on a drop in the price of gold) that a rise in the price of gold is a negative event for those stocks.
SO maybe the drop in these stocks signals the beginning of an major upspike in the gold price (which would benefit the mostly UN-hedged North American gold producers).
Judging by this poll at www.cnnfn.com the sheeple may not have reached the panic stage.
1. Do you think the recent sharp drop in the Nasdaq and volatile performance of the Dow industrials are signs of a budding bear markey?
total responses to this question: 15792
Yes 53.31%
No 46.49%
2. If so, how long will it last?
total responses to this question: 11730
three to eight weeks 40.56%
three to six months 35.04%
a year or longer 24.40%
3. How are you changing your stock investments?
total responses to this question: 15613
no change 49.34%
buying technology stocks 24.79% <---------
selling most stocks 10.86%
selling technology stocks 8.30%
buying blue chips 6.08%
selling blue chips
4. Are you seeking protection for your portfolio by:
total responses to this question: 7765
I think we'll need a double top into July and then the final swoon down. At least that is what my amatuer chart reading tells me. Especially my dollar charts.
I was sleeping peacefully while the paper equity markets around the world were thrashed. It looks like the US$ received some support and the POG is down slightly in the last few hours. Apparently the goal of the paper money cartel is to keep the dollar stable no matter what happens to the equities.
What part of the Constitution doesn't he understand?
1) Hand guns are part of American tradition and culture and lend to the efficiency and preservation of the well-regulated militia, which is the citizenry capable of bearing arms.
2)Maryland Constitution states: Art. 28. That a well regulated Militia is the proper and natural defence of a free Government. This means that they will only have rifles?
3) Since it would seem that Maryland doesn't have a right to keep and bear arms clause in their Constitution (see 2 above), this man is in violation of the Second Amendment to the US Bill of Rights, which clearly states the people of Maryland do have the right to keep and bear arms (meaning rifles and pistols), and they shall not be infringed, which is what he is doing. US Constitution would take precedent over Maryland Bill of Rights because it is stronger.
If I lived in Maryland, I would move. This is an attrocious move against his own people. You have to ask what the Maryland legislatures are doing about this man. What an embarassment for Maryland. Shame on them.
Curran Report Calls for Unprecedented Restriction on Handguns; Seeks to End Most Handgun Ownership
--------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE:
October 20, 1999 Download the 65-page report in PDF format
Download the table of contents
Order a copy by phone or mail
On the six-month anniversary of the murders at Columbine High School, Attorney General J. Joseph Curran, Jr. today took the first bold step toward making Maryland the most handgun-free state in the country. Through the release of his report, A Farewell to Arms: The Solution to Gun Violence in America, Attorney General Curran outlined the first step toward making Maryland the first state in the nation to outlaw handgun ownership except in very limited circumstances. Curran's report contains a three-part plan to reach his goal of restricting the sale and possession of handguns to only those who can demonstrate a legitimate law enforcement purpose or those who can guarantee their guns will be used only in regulated sporting activities.
"It is time to stop kidding ourselves," Curran said. "Guns beget violence and violence simply begets more guns. If we don't change the culture in this country and admit to ourselves that guns are costing us too much in terms of deaths, dollars, and other untold suffering, we are never going to reverse this epidemic of violence."
Against the backdrop of an array of illegal handguns confiscated recently by the Baltimore City and Montgomery County police departments, Curran explained that Congress� tortured attempt to require background checks at gun shows in the aftermath of the Columbine massacre was the last straw for him.
As detailed in the report, over 35,000 people die every year from firearms, and another 100,000 are injured. An average of twelve children are killed with a gun every day. In Maryland, more people die from firearms than motor vehicle accidents - well over 700 a year. In 1996, more than twice as many Marylanders were murdered by handgun than in Canada, Germany, Great Britain , Japan, Australia and New Zealand combined. Nine out of ten murders of children worldwide occur in the United States.
Curran emphasized that contrary to popular perception, the majority of firearm-related deaths are not homicides, but suicides. "Our tragedy of gun violence is not just a problem of law enforcement, but also of public health and consumer protection," he cautioned. "Until we recognize that the horrific headlines about mass shootings in our schools and churches are only part of the story, we will not stop all the dying."
Curran also stated that in addition to the human suffering from gun violence, we pay dearly in economic terms. Medical costs range from $2.3 to $4 billion annually, of which taxpayers pay about 67%. Estimates of total costs, including lost productivity, pain and suffering, and criminal justice resources, range between $20 and $112 billion.
"I have added up these costs - the premature deaths of too many children, the teenagers consigned forever to wheelchairs, the lonely senior citizens taking their lives in moments of anguish, the billions of dollars we could be spending elsewhere - and these costs are too great. In a country of 270 million people and more than 200 million guns, we must finally put the brakes on. We cannot confiscate the handguns people already own, but there must be a moment in history where we say, �no more.�"
Curran's three-step blueprint to close the door on widespread handgun ownership proposes several interim measures designed to reduce specific categories of firearm death and injury. To reduce unintentional shootings, teen suicides, and criminal assaults with stolen guns, Curran calls for health and safety regulation of handguns at the state and federal levels, including Governor Glendening's "smart gun" initiative. Congress should put firearms under the jurisdiction of the Consumer Product Safety Commission, and Maryland should impose health and safety regulations through either legislation or Handgun Roster Board regulations. Curran intends to present his report to the Governor's Task Force on Child-Proof Guns on November 8 in College Park, Maryland.
"It is beyond absurd that we impose safety standards on everything from toys to toothpaste, while we allow handguns to be made any old way manufacturers decide is profitable," Curran stated. "We must insist that guns be as safe as possible, with child-proofing devices, smart gun technology, warning indicators that guns are loaded, and any other safety device the gun industry's formidable powers of innovation can produce. If the gun companies can make handguns ever more lethal, so guns can kill more people more efficiently, they can certainly make handguns safer. To this end, I intend to fully support the Governor's "smart gun" initiative, and I applaud him for his leadership."
Curran also appeals to the General Assembly to reinstate strict liability against the gun industry so that it may be held accountable in Maryland courts for the harms its products have caused. By ensuring that Marylanders are able to join the surge of lawsuits against the gun industry springing up around the country, Curran explained, "we will provide manufacturers incentive to make guns safer and to help keep them out of the hands of criminals. We will also keep Maryland from becoming a safe haven for unsafe guns the industry dares not market elsewhere." Curran also revealed that he is looking into bringing a lawsuit against the industry, including investigating whether the industry may be violating consumer protection laws in marketing guns to children or in other advertising practices.
As the second part of his blueprint, Curran proposes several measures to assist law enforcement efforts to reduce criminal homicides and firearm injury. Pointing out the inconsistency of allowing people to own handguns simply on their own "say-so" that they are mentally stable and non-violent, while we do extensive investigations of people who want a permit to carry a handgun, Curran calls for fingerprint licensing and training of everyone wishing to own a gun. To obtain a license, people should be found, on the basis of an investigation, not to have a "propensity for violence," and they should provide evidence of being qualified and trained in the use of handguns.
"We require more of people wishing to drive a car than we do of those owning a firearm," Curran stated. "The law now permits a person with a known propensity for violence or mental instability and no experience whatsoever in operating a handgun to walk into a store and, as long as he has no criminal record, to take a handgun home. It is no wonder so many people die."
As the final step of his three-part plan, Curran calls for a change in our "gun culture." Like attitudes toward smoking and wearing seatbelts have undergone radical change, so too must people begin to view handgun ownership as dangerous behavior. Curran points out that despite being overrun with 70 million handguns in this country, only a minority - 16% - own all these guns which are causing so much harm.
"Why should we all endanger ourselves and our children every time we go into a movie theater or a hotel lobby where people are permitted to carry guns?" Curran asks. "What about when your child plays at a neighbor's house, where a handgun is hidden in the upstairs closet? We must make people realize that they no longer want to tolerate this behavior."
To put teeth in this public information campaign, Curran asks the General Assembly to take the lead and make guns in public accommodations illegal. Second, he calls upon everyone else - educators, law enforcement, business owners, health care professionals, and especially parents - to begin the effort to change people's minds about how far they are willing to endanger themselves by tolerating the choice of others to have a handgun. "We must get people talking to each other about the dangers of guns and gun ownership. That is how attitudes change," Curran said.
Finally, Curran demands that our ultimate goal be to outlaw handgun ownership except for those with demonstrated law enforcement and recreational purposes. "Only by turning off the spigot will we really end this nightmare," he said. "It cannot happen overnight. But I look to a time when - ten, twenty, thirty years from now - people will look back and say, �That is the moment when they turned it around - the violence began to stop.�"
What part of the Constitution doesn't he understand?
Mr. Curran would appear to be violating a Federal civil rights law against the Second Amendment. Most of the time, the courts held that the Second Amendment because it predates the Constitition can't be passed through to a State via the 14th Amendment. Yet, since Maryland doesn't have a RKBA clause (Art. 28. That a well regulated Militia is the proper and natural defence of a free Government), the Federal Bill of Rights supercedes Maryland Constitition, imo, regarding the RKBA. That would put Mr. Curran, in violation of the 1968 Civil Rights Act and Oprression of Civil Rights law, which includes jail time.
I would think only a Maryland citizen could bring this suit and request a charge against the highest ranking Law Enforcement officer in the State of M. Any takers?
Suggestion ...
(this may be out of context because I was reading quickly before leaving this morning)
Create a PURE trust which has not tax liabilities. This can be confirmed with the IRS. It is also a good way to protect all of your assets including gold.
Lots of movement down in the valley this morning. The river seems to be carrying off what was left of the last bridge to this side of the mountain. Raging floodwaters even the small animals have taken refuge up here. Many deer and raccons (those little bandits! They seem to like things that glitter...they don't seem to find those pieces of paper very attractive...their "masks" seem ever more appropriate). Five fox and at least 10 coy dogs have been through...they seem to be trying to find a less crowded place than the riverbanks below. The carrion fowl are circling lower feeding on the carnage below. A wounded bear came by... he seemed to be licking his wounds...I think he is quite dangerous now. I would not like to see what he would do to that bull that gored him last time out if he were to encounter him again. Alas I fear he was lost in the downstream swirling chaos. Its really quite beautiful up here. A light mist covers the mountain and is burning off with the first rays of the sun just now peaking out over the top of the mountain. Such a peaceful feeling.
4/17/00 Indications
�Current
�Change
Gold June Comex
283.70
- .90
Silver May Comex
5.16
-.01
30 Yr TBond June CBOT
98~06
-0~09
Dollar Index June NYBOT
105.62
+0.16
Market Report (4/17/00): Gold continued to climb in today's early going while Wall Street cooled its heals in
the wake of a very bad night in overseas equity markets. Asian markets crumbled in response to Wall Street's
inflation induced meltdown on Friday and European markets fared only slightly better. The Nikkei was down about
7% and the German Dax about 4.5%. Other bourses broke down similarly. All eyes will be on the U.S. market as
we are in the first hours of what could be a long day. Meanwhile, protesters in Washington D.C. clashed with police
for the second day yesterday as they attempted unsuccessfully to halt IMF and World Bank talks. The protesters
disagree with the way international organizations are handling the world economy. The riots in Washington provide
another eerie reminder of the 1970s, a period some are comparing to the present. Like the 1970s, the first few
months of the 21st centruy have been heavily influenced by rising oil and gasoline prices brought on by OPEC,
inflation fears, failing equities markets, currency turmoil, and now street protests. As the police attempt to hold the
line in Washington so Wall Street will try to hold the line in New York. Gordon Cheung of Mitsui & Co was
quoted by Bloomberg as saying, "With the collapse in stocks hot money is slowly going back to precious metals.
Money will flow into precious metals in the next 3-4 months." Peter Arnot of Desdner, Kleinwort, Benson had a
more far-reaching and fundamental assessment: "We're at a turning point," he said, "The previous 20 years has been
favorable for stocks. We're going to enter a period which is favorable for gold. We've had 20 years where fiscal and
economic factors have been favorable to entrepreneurs. Now we're finding that maybe the environment for cheap
labor is coming to an end. What we're looking for now is for gold to start to perform with small rallies."
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 here ---> ORDER FORM <--- and make the appropriate entries.
I am a fervent believer of the right to bear arms and like to discuss such but on this site it is not appropriate. Please keep your discussion to gold/finance matters. There are plenty of sites to discuss constitutional questions. Your lengthly posts, while intriquing, do not belong here.
Thanx
Dear nugget: SteveH's posts are appreciated and looked forward to by many of us on the Forum. If we lose the right to bear arms, we will lose our other freedoms (including the right to own gold) in short order. I vote for SteveH's posts to STAY!
I have been reading and contributing (in a small way) for going on three years now, and I'm pretty sure SteveH was here before me. From time to time feathers get ruffled a bit, and the situation almost always resolves itself in a peaceful way.
I watch a couple of other forums, as I'm sure most all of you do, interested in the TA at GE, stunned at the abrasivness at Kitco and always at ease here at USA Gold.
I admire SteveHs' determined defence of his Constitution (and I'm not even American) and don't find his posts deter from the general approach to a society that seems to be undergoing a "manipulated evolution."
Was message 28833 a bit alarming? I don't know. It certainly didn't violate any of the guidelines in my opinion, but it did seem oddly out of place, like the crash of a goblet in the castle kitchen.
Most Knightly, but slightly aggressive for this Round Table.
IMHO
No49
To the flock; mine thoughts whose wings shall carry: It has been with the uptmost pleasure that I've read and absorbed all which Sir Steve H. has brought to this table. Although appearing off topic to some, I find his expressions of freedom to represent the core of my beliefs about sovereign rights of individuals. To quiet him is to quell our souls, regardless of our feelings about firearms. I vote his stature to be impeccable.
Relax Friend...Many of us here appreciate SteveH for his years of contributions here. The only one who dictates what is appropriate here is MK. ' Your comment' ...." Your lengthly posts, while intriquing, do not belong here." is less appropriate than Steves post. IMO....YGM.
"GO GATA" & "GO GOLD"....Sell the paper while you can
Notice to anyone who may have missed Saturday's discussion
http://www.usagold.com/goldtrail/There were two new additions to the "Walking the Gold Trail" page in the course of the day. The link above won't take you to Saturday's discussion, but it will set you firmly down upon the Gold Trail. Don't get lost now.
I am a long time lurker (perhaps 18 months) and a first time poster. I post at this time due to the gracious encouragement of our host. I would first like to take this opportunity to thank everyone for the education provided to me to this point.
This question is primarily directed to Trail Guide, however I would most certainly welcome comments from others. As a measure of value, what do you perceive the purchasing power of one ounce of gold to be after the dollar devaluation/hyperinflation has run its course? Saying that the price of one ounce of gold may run to $15,000 per ounce means little to me if the cost of all other goods and services is rising significantly as well in nominal dollar terms. As I have known no other measure of value throughout my life thus far, perhaps you could use the current purchasing power of the US dollar as a frame of reference. I would find this information useful with respect to asset allocation.
Thank you in advance for your kind consideration, and thanks again to all for your previous thought provoking posts.
Leigh, Northie, RossL, IronHead, Good morning guys! I totally agree with all of you.
You know Nugget, I think this is where the protective coat of freedom first erodes, where a set of rules and agreements are in place but an individual or group decides that their own viewpoint is or should be in force.
There is a vast gap between debate and pre-emptive authoritarianism. As YGM and the others say MK made the rules, our constitution if you will. It is fine that you and a few others may wish the topics here to me more gold and economic specific. However there has developed on this Forum, that (regulated my this constitution) this a group agrees that the discussion is open to a broader scope encompassing, philosophy, freedom and political and institutional attempts to silence. commentary on the former and destroy the later.
Your post, IMO, belonged in an E-mail to Michael as your personal feeling, rather than on the main site.
Leigh, Northie, RossL, IronHead, Good morning guys! I totally agree with all of you.
You know Nugget, I think this is where the protective coat of freedom first erodes, where a set of rules and agreements are in place but an individual or group decides that their own viewpoint is, or should be in force.
There is a vast gap between debate and pre-emptive authoritarianism. As YGM and the others say MK made the rules, our constitution if you will. It is fine that you and a few others may wish the topics here to be more gold and economic specific. However there has developed on this Forum, (regulated my this constitution) that this group agrees to the discussion being open to a broader scope encompassing, philosophy, freedom and the political and institutional attempts to silence and destroy both.
Your post, IMO, belonged in an E-mail to Michael as your personal feeling, rather than on the main site.
Don't they kind of go together? Like ham and eggs, peanut butter and jelly, Adam and Eve, George and Martha?
Although this is a gold forum, isn't it a good idea to keep one eye on the BIG picture?
As our liberties are trampelled on daily, none of us can keep up with all of the news. If Steve's post reaches one person in the People's Republic of Maryland that might be able to do something about it, then the post will have served a fine purpose.
As long as everyone realizes that off-topic posts are for informational purposes only and not to be followed up with more comment (as I am doing now).
And if you don't like it, maybe you can do what I do and click that scroll bar!
Hello and welcome. Yes, gracious is our host indeed; good his prices and BEST his "good delivery".
The POG can rise as high as the dollar can fall. When will one ounce of gold equal $15K? When the dollar is worth 1/15,000th of an ounce of gold!
Gold (the commodity) is of course priced in dollars. Gold the "wealth asset" of 5000 years is still fettered in chains. The discussion here is about freedom of POG and other related topics.
Beginning in 1933, the US took the first step down the slippery path that leads to a dramatic inflationary event. Many believe we are at the threshold of that event today.
I am not waiting anxiously in anticipation of that event. I fervently do not want it to happen. I am an extremely patriotic American citizen. However, following the trail here closely for almost one year has lead me to the belief that the dollar is immensely vulnerable, that world decision makers know that fact and that many are making plans for a transition to a new international monetary system. In such circumstances, "We the people...." would be the very last to know anything. You can believe that.
I am entirely dispassionate about the entire matter. I am sitting back and watching events unfold. I have done all I can do for my family and now, we wait. Good luck to you in your search for understanding and "clear thinking". I have learned both here in this court of intellectual giants (sorry for the effusiveness there folks) Good day.....CM
I sincerely thank you for the guidance you have given us in your calm confident manner. During the last few months while the Dollar Power people were capping gold and our brother-in-laws were gleefully watching their dot.coms make them millionaires, it was difficult not to leave the Gold Trail to join the lemmings. However, because of your guidance, I stayed on The Gold Trail and slept very well last Friday night, but I don't think many of our brother-in-laws did. Thank you and thanks to MK for making it possible.
Your point is heard. I normally would try to limit a post not related to gold or to make the tie in more direct. But a state AG who tries to take away a natural right that has been part of this country for over 200 years and no one makes a to-do about it, just couldn't be left unstated. Mr. Curran would arguably be a traitor to the US by my standard. Just because he enforces the law, doesn't give him the right to change the Constitution of his own State and that of the Country to suit his political agenda. He is wrong and he knows it, but he does it anyway. A criminal by any standard. He did it, he intends to do it and it violates two Constitutions and several laws. What shall we say when it is gold he wants because our fiscal managers mismanaged their funds and now they need our gold to bail them out? Does the Constitution mean nothing then?
It is time to strike the foot hard to the pavement. Better to do it with the Second Amendment for when you loose that, you can't fight to hold the other.
"In 1913, before the Senate Banking and Currency Committee, Mr. Alexander Lassen made the following statement: "The whole scheme of the Fed with its commercial paper is an impractical, cumbersome machinery- is simply a cover to secure the privilege of issuing money, and to evade payment of as much tax upon circulation as possible and then control the issue and maintain, instead of reducing interest rates. It will prove to the advantage of the few and the detriment of the people. It will mean continued shortage of actual money and further extension of credits, for when there is a shortage of money people have to borrow to their cost.' "A few days before the Fed passed, Senator Root denounced the Fed as an outrage on our liberties. He predicted: 'Long before we wake up from our dream of prosperity through an inflated currency, our gold- which alone could have kept us from catastrophe- will have vanished and no rate of interest will tempt it to return.'
"If ever a prophecy came true, that one did.
"The Fed became law the day before Christmas Eve, in the year 1913, and shortly afterwards, the German International bankers, Kuhn, Loeb and Co. sent one of their partners here to run it.
First of all puh, puh, puh Peter; odd that you talk about erosion of freedom and then suggest that I restrict my opinion. I have no problem with discussion ranging far afield but over the past months the lengthy posts about gun control seem a bit much and don't really contribute to much debate amongst us. It was my understanding that MK has left us to monitor ourselves (note - YGM). He said so previously when there was a spate of posts with a religious bent. I didn't hear much outcry then when MK said to stick to topic. Not your ox I suppose. If I am wrong about such than I will be glad to contribute also about gun/freedom issues.
- YGM... As far a my comment being less appropriate I can only say that it was meant to be taken that a link is more appropriate. That goes for gold posts too or any post that is of extreme length.
In summary, if the forum wishes to have a wider topic base than I will not oppose. However, there are a lot of lurkers and their views aren't heard. And finally, this is not a democratic forum, MK is our soveriegn and can lop off thy head. After re-reading my first post it does seem a little abrasive. That wasn't the intent I assure you.
Cavan Man ---Messagaes 28844 and 5 -- you are a credit to us all
"Gold (the commodity) is of course priced in dollars. Gold the "wealth asset" of 5000 years is still fettered in chains."
Very astute phrasing! And as you imply in your second message, the easiest way out of this current international monetary nightmare is to let Gold run. The world leaders that matter know this, and we all have front row seats as this unfolds.
Mr. ORO, Did you remember to deduct any "quality enhancements" you have added to the goods and/or services which you provide to earn income? This deduction should lower the final number on your Sch. C which is the number that determines your self-employment tax. This deduction is one means by which the government keeps the CPI from showing inflation and as such must be perfectly legitimate.
Sorry, I wasn't aware....of the self governing thing.....I've been away alot since Jan 1. I wasn't meaning to sound abrasive either in my remark to you. Besides learning alot about Gold and World finances here, I've also learned tolerance and patience, (I hope!) Lets just jump on the Gold bashers and not our own members. My criticizing of anyones posts would just be a case of the pot & kettle so I try hard (and often on some sites) to scroll by w/o comment.
Best Regards to you!........YGM.
............................................................................................
"The Clarity and Truth" that is espoused by USA Gold and its Forum Members is second to none.Thanks to these people, coupled w/ Reg Howe, Bill Murphy, Chris Powell (GATA) Gold-Eagle, and even that old "In The Closet" Gold-Bug, Greenspan, this jaded and almost bankrupt Gold Miner keeps the faith alive in myself (as a Gold Miner), my families future and Gold......
F.O.A....if not for you, Murphy and Howe, I would have quit the Creeks some time ago.....Many Thanks!.....From a Yukon, Canada, Gold Miner who won't quit "OR" Go away..........YGM
Thank you Nugget, it was abrasive. Actually because of the vary fact that it wasn't coming across as an �opinion' but as an empirical fact. I too have fired from the hip with both guns blazing on occasion.
A few weeks ago one of our brethren eloquently stated something to the effect of the Tianimen Square students protesting for their right to free speech without realizing they couldn't protect that right because they had lost their God given right to defend themselves.
My apologies to that poster for being "Too Busy" to validate him. Post it again; Please!
Thank you Cavan Man for your kind welcome and response.
If today I can purchase about $280 with my one once of gold, and use this currency to purchase about 280 cheeseburgers, then after gold runs, and my one ounce of gold now purchases $15,000, how many cheeseburgers will I now be able to purchase?
The event:
U.S. stocks bounce back, Nasdaq in biggest-ever point gain up 217
The imputus:
Citigroup Posts 49 Pct. Profit Jump
Ford Beats Estimates, Earns $2.1B
US gasoline pump price falls fourth week in a row
The reality check:
"I think you'll continue to see a flight to quality and you'll
continue to see the dot-coms that don't have any real profits
slowly sink into the sunset," said Alan Skrainka, chief market
strategist at Edward Jones.
http://www.usagold.comJust as we have seen the meteoric rise of the tech sector and the internet sector, the same euphoria has been directed toward gold in the late 70's and early 80's. If this stock market blowoff is the beginning of the ENDING OF A 60 YEAR CREDIT CYCLE as described by Ravi Batra (who does have some verifiable data), then we are returning to the stagflation of the 80's at best or at worst another great depression. The level of overextension of leveraged debt instruments is unprecidented in our nation's history. Real Estate is borrowed upon to the extent of negative equity valuations. This bubble is 50% larger than the margin debt bubble. I personally can walk into a HUD office with 3 paycheck stubs and a fair credit rating and putting down $1000 cash, can secure a loan of over $100,000 for a home. A home is intrinsically worth the present cost of the land plus the cost to build the home plus extra fees. Real estate in the late 90's has never retraced to these land plus building cost evaluations. My home is worth (so they say) $143K yet the structure costs $60k to build and the land is worth $30k. The rest is spoof. So I took out a home equity loan to wipe out some debt and get a great mortgage deduction. The masses are also doing this. In 1929 there was no bubble in real estate except by some regions maybe the NE urban areas. Requirements for mortgages were strict. NO CUSHION THERE TODAY PAL. (I only capitalize to get attention drawn to the caps, don't take it personally). So the unwinding of margin debt is very closely linked to consumer housing and real estate. VERY sensitive. Personal bankrupcies were popping like popcorn at the end of '98 during the last liquidity crisis. The personal bankrupcy crisis was what prompted the Fed to jump in and lower rates three consecutive times. The action was to boost the economy. As a byproduct of their intervention the stockmarket repuffed and absorbed the extra money. Few paid down their loans more like the Fed wanted. So Greeny had a fit and tried to collapse the stock market to scare some sobriety into the financially "doped up Americans". No luck. Bubble blew and popped. Next bubble gets exposed. Financial derivatives markets have to be like scrambled eggs after last week's plunge. They pray daily to mammon for a super rally that will never happen. No luck, Pharoah's firstborn rally is dead. Distress selling is the next wave down after mutual fund redemptions ripple through the system. It's the burning out of the longs. They buy in and watch the paper go underwater for nasty percentages every time. After the last bull has bought and lost,then you have no buyers and no liquidity. Zero, zilch, none. Any selling after that produces the big 800-1000 pt. drop. Off a mountain top you hit the piedmont. That area with some trees but rocky soil descending down into the farmlands. Most of Ravi Batra's 60 yr. cycle is in these two zones. I'm not convinced that this is the end of a credit cycle because it is too heavy for my mind to handle. My logic tells me it is, but "bull run attitude" has me California dreaming that it isn't over. And that is why gold hasn't soared yet. Too much California sillycone valley dreaming. "Well the tech is cheap now. How much cheaper can it get." Hungry frustraited longs peering through a financial fog. Analysts are like ants who lost the chemical trail.
Bond inversion...........no one has ever seen bond inversion hardly. No wonder they don't know what it means. It means a recession is looming. Globally connected. Remember.........if Merrycons stop buying the plastic gizmo trash from Asia then the toilets backup in Singapore. Their whole recovery depends on the extension of consumer credit in the US. Sad times in America, baseball hotdogs apple pie but no Chevrolet. Money gets tight, interest rates rise. MEANS A DEFAULT ON 3RD WORLD DEBT. Financial sector........ewwwww.....go short son....they will collapse worse than any techy fall. Repeal of Glass Steagul......merger of bank debt with corporate cash? One of the final straws the camel is spitting about. Mr. Greenspan said BANKS MUST INCREASE RESERVES. Why, why say the truth so well? Because it is imperative being the next weak link in the corroded financial chain. He means what he says about it. We soon will have "The Japanese Problem" of dysfunctional financial institutions with no cash, bad debt, and a report of earnings coming due to stockholders. Don't forget to include the inelasticities involved as no one has the mercy to let debts ride on for ten yrs or more as in Japan. The international bankers complain how the Japanese bankers allow the debt to remain because the want to buy Japan for a song. The practices of letting debt ride long are a purely stabilizing force. "We trust you and we are giving you time."
Soo in the US we run into "The counting of the people who found no chairs after the music has stopped." Who got hurt. It isn't beyond propping up at this point but it will surface eventually after the next slide down in the DOW. There is no way the DOW can resurge and hold if the Nasdaq doesn't lead. Trains do not run backwards with a loose caboose. Nasdaq tech is the only engine. No, no basic industries like natural gas and forest products are going to lead. Sure, they will catch some cash but the numbers coming out with the trade deficit..........dried up hopes for a wilted theory.
Your original question was the proper valuation of gold? My answer is that gold cannot have a proper evaluation as it gets very emotional when it becomes dear. And it is emotionally valued down when it is hated and seen as a threat. The truth is that it is always the base and the valuations of fiat currencies sway with the fears and hopes of the bigtime traders. Bottom line being that gold and gold related could gain that same "spoof euphoria" under inflationary times that would warrant selling out at the top just as the tech bubble warranted selling out two weeks ago. Could you imagine buying gold at $800 an ounce to watch it fall back to $520 in a few weeks? That euphoria and subsequent selling panic did occur and probably will occur again at some point in time. The same "buying too late" problem occurs in every gold rally. Goldbugs who fell asleep fail to buy in early and after the big spike they run in and add fuel to the shorters selling out at the top. The present pattern we have seen for gold should change if what the Mitsui gold broker says is true. Fundamental gold shift gets confirmed by a new pattern trend. Don't believe it till you see it..............but then don't be caught buying in heavy the day after. Weigh it all out for yourself. What do you feel comfortable with? Willing to go underwater for awhile until the fundamentals of gold catch up with the market? I am. I'm risk averse. I was half in cash for this whole crash, should have been short but I thought gold would turn hard and it didn't.
Receintly the shift in ideology between the newly accepted Austrian School of economic theory VS the old US Keynsian theory taught in colleges all over America leads us to believe the shift in thinking has no precident as the new Austrian Economic Model is not currently taught to any large degree. (It mentions the "G" word, too politically incorrect). As the economists become insecure as to not knowing what the Austrian Model is, they finally study it and there you go with gold back on the map. All the closet goldbugs can come out and assert their A-1 right thinking. Give it a few months, the textbooks are thick.
Sir Henri- You are truly a "Paine" of the highest magnitude, and speak "Common Sense" for our time. Your thoughts of yesterday, "Brave New World" #28761 and #28757 have entered my Henri Hall Of Fame. For any of the castle dwellers who have progeny in their abode, I highly recommend they give heed to your words.
Could not quite keep up with all the fireworks on Friday as the tiller (we named Mimizu - Japanese for worm) had a little problem, and we had to make a trek to the big city for a new spark plug. Funny how the worm turns when your back is to it.
If I may butt in.....How many Hamburgers?....Who cares!... You'll be eating Lobster at $600.00 p/oz........and buying your favourite restaraunt at $15K p/oz.........Regards-YGM.
****Remember it's all about Gold becoming a "Precious Metal" again, not just dollar buying power. Revaluation for Gold will save the currencies that have enough of it...IMHO....Somewhere I've read that at todays Sugar prices, Gold should trade at $1,600.00 p/oz?????
Some few tidbits on the topic of "letting gold run" as a possible cure
From yesterday's IMF press conference following the International Monetary and Financial Committee (new name for the Interim Committee) meeting. Answering questions are Gordon Brown, UK's Chancellor of the Exchequer and Chairman of the International Monetary and Financial Committee, and also Stanley Fischer, IMF Acting Managing Director.
QUESTION: Mr. Fischer, can you describe the progress made today to try to forgive the $28 billion of debt relief from some of the nations' poorest countries; can you be specific, and, in particular, Uganda?
MR. FISCHER: We had a very good discussion this afternoon on the Poverty Reduction and Growth Facility, and progress on the HIPC Initiative. The representatives on the Board, the Ministers present reaffirmed their desire that we move as rapidly as we can on debt forgiveness, while recognizing that it is necessary to ensure that anti-poverty strategies are in place before the debt relief happens so that we make sure that the debt relief is well used for the purposes intended.
There is a reaffirmation of support for some discussion of the need to ensure full financing of this; as you know, the IMF still needs to get permission to use 5 million ounces of its gold to finance its contribution to the poverty reduction strategy.
On Uganda, that is an issue which will taken up by the Board of the IMF and then later, I expect, by the Board of the World Bank--probably within a few days.
A QUESTIONER: I understand not all countries are willing to support the initiative. Is there anything the Fund can do to ensure full participation of all its members?
MR. BROWN: I think that is not strictly correct. In the communiqu�, which is just being issued, it is absolutely clear that we reaffirmed the importance of the principle of full participation by all creditors. Indeed, we were unanimous in calling for faster and more effective implementation of the initiative to secure debt relief.
Can I just say what has happened in the last few weeks. All G-7 countries have agreed that, on a bilateral basis, they will go to a hundred percent debt relief. Other countries have indicated that they are going to act in a similar way. This is indeed progress from where we were even in December last year.
A QUESTIONER: How did the protest outside impact on the meeting today? After all, some of your participants were late or could not reach the meeting. Could you hear the protests and the chanting, and what comment would you make about the protest?
MR. BROWN: ...Our message is that the way forward is by the strengthened international economic cooperation that we are now proposing with reforms in the international financial architecture, and that this is the best way forward to tackle poverty and to tackle injustices that exist.
We are determined to move forward our poverty reduction strategies; we are determined to get fast and effective action as we can on debt relief. Of course, we are determined to reduce the risks from financial crises that are borne by the poor in so many cases, by creating a stronger system of crisis prevention and crisis resolution for the financial system.
So, we went about our work. We came forward with a number of further proposals for the reform of the international financial system. Almost the whole of our afternoon discussion was about poverty reduction strategies and the HIPC Initiative. I think it makes us determined to move ahead with the agenda that we have agreed, which is a reform agenda for the international financial institutions, but ensuring that we are in a position to provide greater prosperity for all countries, and particularly to benefit those people in places that have too often been left behind.
A QUESTIONER: Mr. Fischer, regarding the permission that is needed for the selling of the 5 [million] ounces of gold, is that permission necessary from the Paris Club?
MR. FISCHER: On the 5 million ounces of gold, we need permission from [the U.S.] Congress to sell that.
------------------------------
From the IMF website, the following text describes their latest efforts with regard to these off-market transactions in gold:
"In December 1999, the Executive Board of the IMF authorized off-market transactions in gold of up to 14 million ounces of gold to help finance IMF participation in the HIPC initiative. Between December 1999 and April 2000, separate but closely linked transactions involving a total of 12.9 million ounces of gold were carried out between the IMF and two members (Brazil and Mexico) that had financial obligations falling due to the IMF. In the first step, the IMF sold gold to the member at the prevailing market price and the profits were placed in a special account and then invested for the benefit of the HIPC initiative. In the second step, the IMF immediately accepted back, at the same market price, the same amount of gold from the member in settlement of that member's financial obligations falling due to the Fund. The net effect of these transactions was to leave the balance of the IMF's holdings of physical gold unchanged."
Next, I am suprised no one or (that I read anyway) seriously questioned AG's (Alan Greenspan) comments regarding those who seek to replace the gold standard remark.
AG is the biggest insider there is and he is saying there is an International effort to replace the gold standard. He turns to them and says they should yearn for the simplicity of the gold standard.
Are we to presume that the Gold standard is not yet replaced? I thought that 1973 marked that event? I thought that gold was just a commodity? Do we have a central banker saying that we are currently under a gold standard and someone or bodies are trying to replace it with derivative based fiat currencies? So what gives? Are we under a gold standard, and if so, why is it that gold trades as a commodity? Seems like a shell game to me.
We here at USAGOLD all knew that gold was still important, that it was a demonitized standard. Any brick with two or more holes could see gold was what all currencies revolve around. Those talking heads and analysts they pay to talk their books conveniently talk of gold being a commodity but that is when it suits their fancy. Otherwise it would seem that gold is a currency, but just not one that is called currency, rather just gold.
Speaking of games. This business of "beat estimates" has got to stop too. All you statisticians, please tell me what the odds of most companies who beat estimates of earnings by $.01 is possible as often as this happens? In other words, if 10 companies beat estimates by $.01 in a period of three months and these companies are index stocks, is it not reasonable to believe that those who gave the estimate fed information to those who beat it; or those who beat it gave it to those who estimated? If it is widely held that beating estimates by $.01 gets the best stock gain and the estimator and the estimatee share information to make that result happen, then could one not also assume that something questionably legal is taking place?
So, this game of estimating really seems to have been relegated to a science and punishes those who ignore the rules of a game that borders on the side of questionable ethics. In other words, those with ethics hold any info that might lead an estimator to estimate, thus perturbing the estimator who then punishes through the markets that company for not playing the game. Do I have this right?
Date: Mon Apr 17 2000 16:50
nomercy (UK watchdog to look at Treasury auctions of gold) ID#207145:
Copyright � 2000 nomercy/Kitco Inc. All rights reserved
The Treasury's sale of more than half of Britain's �4bn ( $6.3bn ) gold reserves is to be investigated by the National Audit Office.
The NAO, which independently scrutinises government accounts on behalf of parliament, on Monday said it would examine whether taxpayers had received "value for money" from the sale.
Its report, to be published by the end of this year, will assess the government's implementation of a series of auctions that began last year.
In particular, it will consider whether the government did what it could to maximise proceeds from the sale, what advice the Treasury took, and the effect of the auction process on the prices paid by bidders.
Since last summer, the Bank of England has sold 125 tonnes of gold in five auctions. More auctions are planned this year.
When the Treasury announced its intention in May 1999 to sell 415 tonnes of gold reserves, prices tumbled. Prices only recovered when other European central banks agreed to a five-year moratorium on further sales.
The review of the gold sale is one of about 50 value-for-money audits of the public sector conducted by the NAO annually.
By Christopher Adams, Economics Correspondent
Published: April 17 2000 17:32GMT | Last Updated: April 17 2000 17:38GMT
All of what I know about the subject I've learned here. Therefore, I must in all candor and honesty admit that I do not have an original thought on the subject.
For your guidance on "clear thinking" I am most grateful.
Always beware the charlatans and hucksters at these sorts of venues right? I'm a pretty perceptive chap and I see little except intellect, clear thinking and a willingness to help others learn here at this site (USAGOLD.com).
We should expect our government to fight like heck for the sovereignty of USD and support their machinations. After all, although not explicitly delineated, I believe our goverenment has a constitutional responsibility to do so. However, a "duty" to the detriment and some might contend the impoverishment of much of the rest of mankind? Don't think so. The protests in D.C. are evidence of much of what is simmering in the kettle and the timing is a little curious? While I was ironing my daughter's dress this afternoon (yes, I am a renaissance man) I thought of the hands from far away shores that touched this garment. The price was a pittance for their long hours of labor. To reward third world countries with USD foreign aid merely perpetuates the terrible injustice of it all. Sort of like institutionalized welfare in this (US) country; those people (recipients) never had a chance.
I can certainly understand how there might be a tremendous "political will" to steer another (no pun) course. There is a vehicle (Euro). If the ME nods and winks, then it will be the job of the politicians, leaders, influencers and monied titans to cobble it all together. Can they do it? Well, that's the bet. All thinking people should be hedged (no pun) for that possibility.
Nasdaq 3539.16 + Dow 10,582.51 = 14,121.67 devide by 2= Ponzi 7060.835 Up a woppin 247.305 Ponzi points.
Thai Gold , Glad you like the ponzi avg.
I think you should post the patsy as I have lots to read each day. I was going to quit the ponzi posting, but it was working so I kept it up. Now it looks like they are TOTALLY out of control!
Gold was their ace in the hole all along. It's a liquidity issue! The bloody gold never leaves the vault! Talk about accounting hijinks and funny business!
It's the spoon thing again--it doesn't exist and never existed. Those in positions of wealth and power can live peacefully in this type of context but when things look choppy, they pull their chips off the table and the rest of us wander around looking for another game.
FOA said to me a long time ago theat in his opinion, we are nearing a point where it is time to find out "what is mine and what is yours".
IMHO, the current monetary system is unsustainable. It's time to regroup. History shows us the regouping is always done with gold. I believe our timing is good.
Town Crier: Your 28860 post quoted an IMF website as saying that the "IMF sold gold to the member at the prevailing market price" and then that the "IMF immediately accepted back at the same price, the same amount of gold" I'm confused. I thought they sold the gold at an old low fixed price (like maybe $35/oz), then marked it to market (Comex price of the day), immediately repurchased and credited the difference toward debt reduction. No? How can this be if they sold and repurchased at one (the same) price?
It would be a strange world indeed if someone here were to accurately predict not only the future POG, but the percent contribution between true gold price rise (against all fiat) and dollar fall against gold....and an even stranger world if you were to believe the prediction.
Consideration number 1. Do you personally believe that gold is more than an "industrial metal"??? That gold actually functions like a currency???? Given the extreme uncertainty in all nations' creditworthiness...owning some gold in hand is just some "real money" that won't be debased, and will be convertable to any strong fiat.
Consideration number 2. How much downside do you personally see in the US Dollar??? The more you see, the more gold attracts. There are two opposing forces on the dollar...first, there is a massive outstanding debt worldwide denominated in dollars, and many debtors who would love to pay back with worthless dollars. On the other hand, the dollar is THE CENTRAL MEASURE OF THE WORLDS MARKETS. A 30% fall in the value of the dollar over a year would really mess things up...A fall to less than 50% of today's value against other currencies with be a financial catastrophe for all the world (for a while). And yet a doubling of the POG would not be a big surprise if the market were simply let free of GOLDman Sachs and cohorts.
So my dear sir...my humble and inaccurate prediction...
The appreciation of gold against all fiats will be much greater than the devaluation of the dollar against same fiats.
In the end...the dollar will survive, Americans will have a strong export economy again and continue to be the nation where most of the "future" is invented. Not because we are smarter....but because the future is entreprenurial in nature.
The best case for a high gold price would be to see a "steadily eroding dollar" year to year convincing many that gold was a good place for capital preservation and perhaps appreciation.
http://www2.hawaii.edu/~rummel/20TH.HTM Sir Peter, since you used the word "eloquent," I'm
_positive_ you must have had my post (below) in mind. ;>
Well, I hope so, anyway.
For those of you who don't like gun-rights posts, even under
SteveH's nomenclature, "Protecting Gold," - - - and if you
trust the U.S. government and don't think the rights
recognized by the Bill of Rights, particularly the right to
keep and bear arms, are in any danger, you can probably skip
this post. I guess the rest of us will have to take care of
the problem for you.
Guns & "public health" THE perspective @ SteveH, nickel62,
dragonfly, ALL {originally posted March 9, 2000}
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.
To put this in a bit of context, there were 12,396 non-
suicide gun deaths reported in the u.S in 1988. Keeping
that number in mind, consider the following:
-Trampoline injuries and deaths have increased to
82,000 per year. Trampoline manufacturers defend
their product by claiming trampolines are safer
than bicycles. -CNN HEADLINE NEWS, 00/03/11,
10:44:29 AM
Guns are not, however, even in the same catagory as cars and
swimming pools, or trampolines. There is little up-side
potential in going seat-beltless or in smoking. Further,
even cars -- and certainly swimming pools and trampolines --
don't save lives. Guns do. Thus "public health"
calculations in terms of implements of self-defense,
especially guns, are toatlly upside down.
And not surprisingly, the fact that approximately sixty
percent of gun deaths are suicides is traditionally ignored
by those inadvertantly in favor of the easy murder of
unarmed victims. 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, non-suicide gun deaths amount to only about 40% of
the normally reported figure. [_Cease Fire_, by Josh
Sugarmann and Kristen Rand, Rolling Stone, March 10, 1994]
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 (minus suicides, who traditionally use
whatever is available). 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.
The IMF must conduct its affairs in this roundabout manner so as not to run afoul of its Articles of Agreement.
Let me translate the events, using the text of the IMF as previously posted.
"Between December 1999 and April 2000, separate but closely linked transactions involving a total of 12.9 million ounces of gold were carried out between the IMF and two members (Brazil and Mexico) that had financial obligations falling due to the IMF."
TC: Brazil and Mexico each were debtor nations in good standing, that is, they "had the cash" as necessary to make their IMF loan repayments.
You see, according to the IMF's Second Articles, gold was not longer used to denominate the international system of currency par values. Instead, the gold was simply valued at a fixed SDR 35 value on the IMF books, and was put aside in the vaults as the ultimate contingency plan. As a result of today's performance of intercurrency exchange rates in London Forex action, 35 Special Drawing Rights are the equivalent to $47.19 in value.
"In the first step, the IMF sold gold to the member..."
TC: They "intercepted Brazil or Mexico's regularly scheduled cash loan repayment, using these funds to effect a very temporary purchase of whatever amount of gold it would equate with at current market prices.
"...at the prevailing market price and the profits were placed in a special account and then invested for the benefit of the HIPC initiative."
TC: The "profits" that were then wisked away into the special account at the BIS were the difference between the IMF's official book value of SDR 35 and whatever the market value happend to be at the time. The BIS got the "extra" value per ounce, and the IMF retained the original SDR 35 value in its own account.
"In the second step, the IMF immediately accepted back, at the same market price, the same amount of gold from the member in settlement of that member's financial obligations falling due to the Fund."
TC: With Brazil and Mexico's cash loan repayment being thus diverted, they was still the matter of settling their repayment obligation. This they achieved by using the gold itself, turning it back over to the IMF.
"The net effect of these transactions was to leave the balance of the IMF's holdings of physical gold unchanged."
The IMF still has its original gold, still at SDR 35 per ounce. But the BIS has become the custodian of an additional account of funds, seemingly from thin air. All made possible from the inimitable power of gold...on a relative basis more valuable today than it ever has been in the past.
Jon Corzine for Senate, using gold investors STOLEN funds!!
Saturday's New York Times noted that Jon Corzine, former co-chairman of Goldman Sachs, spent $6.7 million dollars of his personal fortune during the first quarter of this year in order to secure a New Jersey Senate seat. In total he has spent over $10 million on his campaign for the Senate seat.
The man earned $35 million in 1996, 32 million in 1997, and $32 million in 1998.
He refuses to release detailed info about his financial holdings since he claims it would violate the privacy of his partners at Goldman Sachs and "place them at a competitive disadvantage." How ironic...a firm like Goldman Sachs, an expert at placing other companies (notably gold companies) at competitive disadvantage, insists on safeguards against putting it at competitive disadvantage??
Mr. Corzine, I for one, would like to know more detailed info as to the source of your funds. In fact, let me put it to you a little more succinctly: I DEMAND TO KNOW THE SOURCE OF YOUR EARNINGS!!
As a much harmed gold investor, a victim of the secretive bullion bank gold carry trade this past decade in which Goldman Sachs played such a notable role, I would like to know whether or not I was made an "involuntary" contributor to your political campaign.
I want to know how much of your obscene fortune came from the tears and misery of bankrupted gold producers and gold investors who had no knowledge of the role Goldman Sachs played in destroying an entire industry (excluding its favored client, Barrick Gold) through the nefarious gold carry trade.
I want to know this information because you are making claims in your campaign that, owing to your role at Goldman Sachs, you helped bring general prosperity to America this past decade. However, you seem to neglect any mention of Goldman Sachs role in the decimation of the gold industry (excluding your favored client Barrick Gold).
Until you release this information, so help me God, I will do everything in my power to defeat you and ensure that you are sent into permanent retirement come Election Day.
For those gold investors who would like to voice similar sentiments, I am listing the two E-MAIL addresses of Mr. Corzine's campaign managers:
Steven Goldstein:
SGoldstein@votecorzine.org
Christy Davis:
CDavis@votecorzine.org
Give these scamsters a blast like they have never received before!
Jon Corzine for Senate, using gold investors STOLEN funds!!
Saturday's New York Times noted that Jon Corzine, former co-chairman of Goldman Sachs, spent $6.7 million dollars of his personal fortune during the first quarter of this year in order to secure a New Jersey Senate seat. In total he has spent over $10 million on his campaign for the Senate seat.
The man earned $35 million in 1996, $32 million in 1997, and $32 million in 1998.
He refuses to release detailed info about his financial holdings since he claims it would violate the privacy of his partners at Goldman Sachs and "place them at a competitive disadvantage." How ironic...a firm like Goldman Sachs, an expert at placing other companies (notably gold companies) at competitive disadvantage, insists on safeguards against putting it at competitive disadvantage??
Mr. Corzine, I for one, would like to know more detailed info as to the source of your funds. In fact, let me put it to you a little more succinctly: I DEMAND TO KNOW THE SOURCE OF YOUR EARNINGS!!
As a much harmed gold investor, a victim of the secretive bullion bank gold carry trade this past decade in which Goldman Sachs played such a notable role, I would like to know whether or not I was made an "involuntary" contributor to your political campaign.
I want to know how much of your obscene fortune came from the tears and misery of bankrupted gold producers and gold investors who had no knowledge of the role Goldman Sachs played in destroying an entire industry (excluding its favored client, Barrick Gold) through the nefarious gold carry trade.
I want to know this information because you are making claims in your campaign that, owing to your role at Goldman Sachs, you helped bring general prosperity to America this past decade. However, you seem to neglect any mention of Goldman Sachs role in the decimation of the gold industry (excluding your favored client Barrick Gold).
Until you release this information, so help me God, I will do everything in my power to defeat you and ensure that you are sent into permanent retirement come Election Day.
For those gold investors who would like to voice similar sentiments, I am listing the two E-MAIL addresses of Mr. Corzine's campaign managers:
Steven Goldstein:
SGoldstein@votecorzine.org
Christy Davis:
CDavis@votecorzine.org
Give these scamsters a blast like they have never received before!
This latest pathetic little gold rally ended the same as all the other ones -- it fizzled badly. Look for new lows in the gold stock indexes tomorrow.
The continues strength in the dollar despite the problems of the US stock market virtually guaranteed this result.
But the biggest force keeping gold in the dumps is not the dollar. Rather it is the continued availability of huge amounts of CB gold for lease at giveaway rates. Unless lease rates go up sharply and remain there, any hope of a gold bull is nothing more than wishful thinking.
"Many of the people who post at _______ are looking for something to "believe" or they are trying to get others to believe what they do.
Those of us who are looking for something to trade and do not feel that "believing" in anything is necessary for trading are looked upon as monsters or worse.
I have noticed a trend in the USA and here at ______ of people trying to severely HURT someone just because they don't agree with them or don't like what they think. They try to cost them their wealth, their job, their friends and their freedom ( by false accusations or by framing them in some manner ) . People worry about hate crimes and persecution because of hatred yet I see those same people spew hatred at people just because they disagree about what is money or what is fair or not fair in business and government.
If we really do have a great crash and the wealth of the average person disappears I fear a blood bath as people give their hatred free reign......
Freedom of speech and tolerance of another's beliefs are a bad joke in America today."
---------
I find the sentiments expressed by this trader to be singularly baffling.
He makes an impassioned cry for tolerance and asks that those who trade without beliefs be looked upon with understanding and without prejudice.
Unfortunately, that type of mentality is the root cause of the moral breakdown in this country. Momentum trading and making money for the sole sake of making money, without goal or without purpose or any conception of morality, is the reason the country is beset by hatred and rage. How strange that this trader cannot see that! A life based solely on materialism cannot be ultimately satisfying.
A trader's universe is singularly and entirely immoral. A pure trader who does not give a damn what his product is or where he invests his money does not realize that every time he makes an investment, he is voting for or against a certain condition in the world.
If I choose to invest in child pornography, then even if I only hold the investment for a day, I make a vote as to what kind of society I want.
If I choose to invest in a defense company, I make a vote as to whether or not I wish to have somebody's arms blown off or not.
Etc., etc.
So when a pure trader appears and demands tolerance and understanding for his spiritless activity, I am sorry but I will not give you one scintilla of that.
If you do not make a moral choice, then I will let you have it in no uncertain terms, and to hell with so-called freedom of speech or freedom of choice.
Because freedom unfettered leads to tyranny of the human spirit. Too much freedom is as bad as too little freedom, one oppresses as much as the other.
Good things sometimes come to those who wait. If your disappointed by thinking the stock market's upswing held down POG take a look at Steve H's 28863 post. The numbers he shows are not those of a healthy market. If equity weakness perhaps causing dollar weakness is necessary for freeing the POG, I suggest chances are improving. About the only items on the positive side last Friday were mining stocks. Two observations from this, first- it did happen and happened during the heat of the moment, second- I don't think it went unnoticed by those who fled there and by those who will flee there next time. Gold has not been forgotten.
da2g #28855 Excellent discussion material--1 ounce of Gold=280 cheeseburgers.
The first thing I thought of when I read your post was, when Palladium recently shot up to almost $1000 per ounce, did the prices of cheeseburgers shoot up? Answer...No!
Here is another comparison:
Most here at USAGOLD agree the "Spot" price of Gold represents 90% paper Gold traded and only 10% real Gold traded. So lets use our imaginations and apply the 90/10 ratio to cheeseburgers.
If chits for cheeseburgers were issued by every facility that made cheeseburgers and people wagered constantly on the value of the chits and bought and sold chits so much so that the item(cheeseburgers) SEEMED to be not as value-able as the paper chits,which could be exchanged for other types of paper chits,,,, after a while(years) the volume of chits representing cheeseburgers grew to such an enormous amount that the real price of the cheeseburger was totally distorted to any where from 60% to 10% of it's real value....you have an idea of whats been going on in the world Gold market.
Then throw in a cartel of brokers and bankers that make the rules saying only certain banks are allowed to issue cheeseburger chits, and only brokers are allowed to trade cheeseburger chits for clients......you get more of an idea of how it would be possible to manipulate the price and value of cheeseburger chits.
Also the broker makes a commission on each transaction(buying or selling cheeseburger chits)...so it would be in the brokers best interests to perpetuate this lucrative business, as long as possible.
Now what if the public got tired of this game because they figured out the brokers always win and the public seldom wins......the real price of cheeseburgers would be re-established....
So the question by Sir da2g was if Gold went up to $15,000 per ounce what would the price of cheeseburgers be?
The honest answer is; supply and demand would regulate price-ing on all things(something is worth what another will pay, but only for a given time), however we see by the example above in the year 2000 illusions are not confined to movies and T.V.
Thank you for reading.
Real Gold is not an illusion....get you some....beesting just having fun.
H & H's demise is just another nail (big time) in the coffins of those who lease and sell the unowned Gold & Silver...
The "Great Reckoning" will unfold in due course I truly do believe.....YGM.
I too believe the fundamentals are changing slowly but surely to a higher valuation of true wealth from the land.
Those analysts cited in todays report are in my opinion seeing clearly. The CRB index was at about 182 in Feb. 99 and has an upchannel going up to 220 today. I have noticed a rather large price rise in all catogories of grocery items in the last 120 days. Increased pricing power has been reported to be going on across large segments of industry. The raw products of the earth will seek and obtain more pricing power equilibrium with the new age paper shuffle bamboozle. The real fruit of the earth, gold the mothers milk, and labor must have greater parity with the bells,whistles, and glitz. A lot of unrest is manifesting in the world right now because of these disparities.
No one on this earth sits down to their dinner and eats bells,whistles, and glitz.
Will the government confiscate gold? If they try will they succeed? After all, this isn't 1933 any more - today almost half the American people won't even fill out a census form! Hmmmm... How to enforce compliance... ?
Remember Mogadishu, Somalia? A Delta/Ranger Task Force was shot to pieces by an armed and aroused citizenry (like it or not) - and sent packing. That won't work.
But in Tienanmen Square some students tried to exercise their (God given) right to free speech without first having secured (for themselves) their right to bear arms and were crushed. Score one for tyranny!
Hmmmm... better confiscate the guns first, Bill.
That may not be the post I was thinking of but I remember it also and it's even better with today's preamble. $Especially >>>>I guess the rest of us will have to take care of the problem for you.<<<<
Farfel (4/17/2000; 18:09:03MDT - Msg ID:28876) Well said David; Amen to that!
Cavan Man (4/17/2000; 15:49:47MDT - Msg ID:28864)
You too with the main paragraph of the above post.
IronHead (4/17/2000; 14:53:20MDT - Msg ID:28858)
Re Henri (4/16/2000; 14:11:41MDT - Msg ID:28761)
Brave New World
Yes that was a heart warming post. I've been thinking of nominating it to the HOF .Consider it done and, are you seconding? Or vise versa?
*************
I would like to see a wing created in the HOF for posts addressing social ethics and justice. I would personally want it to be open to nominations for past posts including submissions by the writers themselves. Perhaps in some cases a specific paragraph could be entered as often the relevant content is part of a larger context. Just a nebulous idea right now but the �Thread" is there.
Analysts predict the return of gold as the safest haven for investors
hit by the stock market collapse. In Asia on 17 April 2000, the spot price of
gold rose over $US2 an ounce. South African miner, AngloGold Limited, ended
the day $A1.53 higher on the Australian Stock Exchange. Institutional
investors overseas have been investing heavily in gold stocks for some time to
counteract falls in other sectors. However, gold exploration companies, which
have recently moved into the Internet sector, were among the worst hit in the
technology crash. Analysts say that most had taken large stakes in ventures
with no real assets and predict that many will not recover.
[Fair Use For Educational/Research Purposes Only, And God Bless The Writer]
He Got it wrong in a BIG way!
----------------------------------------
Date: Wed Apr 12 2000 17:35
APH (Trading) ID#7223:
June snp - For tomorrow buy at or near 1460 in the first hour, this should be wave 2 of
5 of 5 in the wedge dating back to 1998, objective still 1585 with a 1571 stop basis spx,
major short positions should be considered above 1585.
-- It is a civic duty to bear an arm (tough to do if you can't own or bear a pistol).
-- Guns are good for society because they save more lives than those who misuse guns cost in lives.
-- When all is said and done, the people will realize they always had the right to keep and bear arms. We are just taking a slight detour for now.
I will add a second civic duty: Congress needs to read their email. Until they do they are missing the boat and the real value of the Internet. Tant-pis.
After a long day and night of market thinking (for me anyway), just thought I would toss this quick one in here. Cavan Man's post gave me the thought (smile)
--------------------------------------------
If today I can purchase about $1.00 with my one CHEESEBURGER, and use this currency to purchase about 1/280 OUNCE OF GOLD, then after CHEESEBURGERS run (from price
inflation), and my CHEESEBURGER now purchases $75.00, how many OUNCES OF GOLD will I now be able to purchase?
ANSWER: About 75/15,000 of an ounce! ( big smile)
My real point:
From around 1929 to date, Americans have never known a real, full blown, all out "price hyper inflation". We have only history books and movies to give us the true mental and
physical picture of what it would be like. Yet, even these cannot begin to portray the real human interaction "up front and personal" the way it happens in real life.
To date most of us still think of things in dollar values. After a real inflation begins this all changes. But in the same way a traveler adjusts his currency values when shopping in a foreign land, so too will you quickly learn to think of things in real terms instead of dollar terms. A hundred dollar cheeseburger will be a normal as a 50,000 peso "whatever" in Inflation Land. The same attitude
will prevail in gold.
Thanks ALL for reading, but much more thanks for thinking for yourselves
I seldom post to this group(been over a year)-- but wish to again thank those gifted contributors whose moral insights and financial perspectives have been found of value.I read this site nearly every day.
For persons respecting honesty,common sense,and fair play in business/investments --these past few years have often been very discouraging.Especially is this true for us long suffering investors in Gold and other PM's.In my individual case the cost of holding substantial amts of Au/Ag for years--expressed in terms of opportunity lost could literally make me sick.Like now when every historic measure of value says "Go Gold and Silver",when the corruption and hype of the dot.com madness makes a mockery of traditional measuring rods---I find it helpful to just thank God for the gift of life and focus on the many blessings money cannot buy.
I am confidant that corruption,funny money,and financial sleight of hand will eventually lose.Whether we or our heirs enjoy the harvest-- it will come in due course!
Well it would seem that the price of oil is rising in stealth mode. Whilst all eyes are glued to the markets, oil is slowly working its way higher (again). Now, May crude is $26.17, up $.28. Pressures are still there.
http://www.usagold.comAren't the Rothschilds the biggest shareholders in Handy&Harmon? Also, what do you think the super-rich will eventually convert their cash into?
How true. You know I watched CNN tonight. I saw an analyst speak of how good the economy is, how healthy it is and it has never been better. This man had no idea of the gold short position, the PPT, the ESF, the Euro, the Washington Agreement, the Tocom platinum problems, the four-large holders of silver producers, etc. So, how in the h*?! can they sit there and say that?
I saw an author discuss bonds, 401Ks, municipal bonds, index funds, but when asked by Mr. King what alternatives there were to stocks and bonds, the word gold never came up -- just more paper.
I fully agree with you that this stock market bounce was much weaker than appeared on the surface and will not last long.
But there is an old investment adage that should not be ignored -- AN INVESTMENT THAT CANNOT RISE ON GOOD NEWS IS HEADED LOWER. Now granted that gold and gold stocks did move up a little last Friday -- the rally was pathetic considering the turmoil in global amrkets. And gold and gold stocks fell back as soon as the markets calmed down. Including the drop on access tonight POG now is LOWER than it was before the Friday mini crash. Look for the gold stock indexes to take another big hit tomorrow -- probably to new 12 month lows.
Gold and gold stocks will undoubtedly have a decent rally at some point. But right now there is absolutely no sign that the bottom is in.
IMO $2.00 moves are meaningless. What matters more are support/resistance levels and ranges. When the Washington Agreement was announced, gold was at $276 this price has held +/- a bit for seven months. I predict you will NEVER see gold below $280 again!
"At first, shareholders in Europe and North America will be complacent;they will be advised by Wall Street brokers and bankers not to panic,because the US Fundamentals are supposedly ver sound. Bill Clinton and Alan Greenspan will reassure the public (he left out Gore didnt he?)and possible lower interest rates. The experts will sing the glories of long-term investing to the public. As a result,
after each downturn, stock markets will recover somewhat. But the global supply-demand gap will not disappear and we will continue to see crashes in the financial markets. At some point the public or institutional investores will panic. This is when a thunderbolt will strike the New YOrk Stock exchange. "
From time to time I have labeled stock certificates the 5th largest currency.
Well, last week my middle daughter was negotiating with her landlady over buying the house they rent. When she told her that the down payment was coming from a family trust fund that was in mutual fund shares, the lady said she'd take the shares directly as payment.
You have something only an Idiot would need. New York is pressuring "Big Tobacco" for safe cigarettes.It seems that one in every four fires in the "Big Apple" is caused by a careless cigarette. (stop the madness now!)
So, the push is on for a safer smoke. I'm not real sure how Big T is supposed to invent a ciggy that will burn itself without burning anything else.
This all makes about as much sense as trigger locks on handguns. Rule #3: Never place your finger(or anything else) inside the trigger guard unless your sights are on the target. People will be injured as a result of accidental discharges due to installing and removing trigger locks. People will be burned in fires started by "safe" cigarettes.
Why don't they just require all bedsheets to be made of Nomex and all clothes of Kevlar? Ever hear of a guy shooting himself in the butt with a Kevlar vest? Oh well, it's touted as the most dangerous city on earth. I can't wait to see the ads in the Times: "Marlboro Dims: Won't stay lit, tastes like...."
http://www.usagold.com Some of the recent posts regarding the Constitution prompt
me to write this. April 15 and American are surrendering how
much in taxes 22% or more. Its outrageous.
Whats more the Income tax as currently administered is a completely unlawful tax. The Constitution and the Bill of Rights have been thrown out the window by the courts. If
you 2nd amendment supporters think the Constitution is in
effect you are living in a fools paradise.
It is only a matter of time before they take away your right to own guns. Theyve done it with your other rights, so why cant they do it with that one also.
Americans deserve what they are getting as they are, by and large, a cowardly lot concerned only with their own security.
For more information on your governments illegal activities:
Are We Ready for This.?.========================================
Monday's PATSY Report
4-17-2000
To: ALL
To: Shifty
Okay, Shifty, I'll try to post a nightly
PATSY Index. To show us all how much we've
been conipulated (conned & manipulated).
XAU=56.87 + POG=281.20 + POS=5.10
-equals-
342.97
Down -1.11 from Friday.
Comment: Just a modest decline. Not to worry.
We've been through alot worse. Considering the
massive intervention(s) of the BadGuys, today,
the PM's resilience and fortitude has kept us from
being much of a PATSY this day. But we were still
conipulated out of what were much higher figures
earlier in the trading hours.
Prediction: More (or less) of the same, tomorrow.
ThaiGold...
Got Some.?. ... Get Some.!.
===================================================
"easy" Q from 1st time poster: what FORM is best for having bullion?
Greetings. I have enjoyed lurking these past few weeks,
following the wisdom offered by knowledgeable forum
roundtable members.
Due to Y2K concerns, last year I acquired gold in the form
of American gold eagle coins, mainly 1/10 oz; and silver,
all in the form of 90% (junk) pre-1965 quarters. This form
was touted at the time as being best in the U.S. for worst
case Y2K bartering scenarios.
I would like to buy more gold and silver bullion, on a
regular basis. I know that there are many issues
concerning "legal tender" (confiscation legality),
numismatic appeal, etc., etc. With this in mind, I would
like to know what is recommended for "optimum" physical
gold and silver buying, including the best "bang for the
buck" (maybe bars over coins?).
Steven Kaplan writes in his latest;
When is gold likely to rally most sharply?
ANSWER: Having been accustomed to buying stocks on dips, since
this strategy has worked so well for a decade, investors who have sold high-tech shares and are trying to decide what to do with their money are
anxiously awaiting each move in the Nasdaq, not only because of fear of losing money in a continued decline, but of lingering worry about missing out
on a rally. Once the Nasdaq has attempted to move higher over some period of time and ends up plunging sharply lower once again, a core of
investors will conclude that the Nasdaq is not going to rebound after all, and will finally commit to gold and its shares as the only viable liquid
alternative which has the potential for a double-digit gain.
Each family unit like atoms and molecules make up the larger body politic. It is collectivist nonsense and Marxist propaganda that feeds a continuing driving force to nullify the Constitution and Bill of Rights. Whose very purpose was to enshrine an exaltation and sanctity to the supreme empowerment of the individual. The Founding Fathers' mindset was that only with strong individuals could the collective manifest strengh. Now we have the opposite mindset. The power of the state is to be safeguarded no matter what sacrifice(stealing),is put upon the people.
All of us are freeborn into the Constitution and Bill of Rights of our Fathers. We owe no allegiance to the dictates and proscriptions of a criminally,treasonous Federal apparatus. They are law breakers who continually act against the OATH of office they all took and need to be brought DOWN.
My advise is to buy gold in any form you deem to be prudent. There comes a time when Civil Disobediance is the patriotic order of the day. The Federal Criminals can throw a confiscation party, but you need not attend.
I disagree with Kaplan on what factors will ignite a gold rally. The public almost never initiates a rally in anything -- they generally jump aboard once the big boys have started to move. They are FOLLOWERS, NOT LEADERS
I see the dollar as key. Once the greenback starts a sustained move south, gold should rally significantly. But unless lease rates move sharply higher, I doubt that even a sharp drop in the greenback could push POG over $300.
http://www.mrci.com/qpnight.htmYesterday's market action seems to provide more fuel for the PPT theory. About 3 hours before the NYSE open, s&p futures were down -21.50. Shortly after they rocketed to the plus-side in a matter of minutes as derivative and options positions were aggressively purchased by unknown buyers. Is this collusion among investment houses or the often cited so-called PPT? The advance decline line is still decidedly negative with only 1280 stock advancing and 1729 declining on the NYSE, and 1752 advancing and 2614 declining on the NASDAQ. This morning, the s&p futures are currently down -8.00, but were down -10.20 a couple of hours ago. Are these forces preparing to charge forward with a narrowly focused purchase program in an effort to prime the markets for another rally. We shall know soon enough.
Source: Bridge NewsGOLD MEET:WGC chief says some nations re-think gold, currency link
Palm Springs, California--Apr 17--Some countries are already in discussions with the International Monetary Fund for exploring the possibility of it changing the ban on linking currencies to gold, said Haruko Fukuda, chief executive officer of the World Gold Council, pointing out that many have become
more open minded since the Asian currency crisis and are 'not ruling anything out.' (Story .25160)
Black Blade: Mark Mobius of Templeton Funds reportedly had made this suggestion to S. African officials concerning the Rand and a link to Gold. Hmmm����
GOLD MEET: Metals was preferred hedge in Y2K, says FideliTrade
Palm Springs, California--April 17--The Y2K experience shows that gold and silver can be used as a hedge against uncertainty, said Michael Clark, managing director at FideliTrade Inc. Speaking at the annual Gold and Silver Institute conference here, he said that the fears of a breakdown in the banking system was not isolated to zealots and extremists, but that more sophisticated investors were turning to precious metals. (Story .11298)
Black Blade: Well, well, now are PMs to become a mainstream alternative? My my, what will they do on CNBC? I guess the boys and girl will be foaming at the mouth.
Palm Springs, Calif.--Apr 17--The unique attributes of gold--it is non-national, not managed like the currencies of today's nations--make it the logical choice of money for global commerce and the best payment system for e-commerce, said market commentator James Turk of Freemarket Gold & Money Report. Speaking at the Gold and Silver Institute annual meeting here, Turk is the founder of an Internet venture called GoldMoney.com, the objective of which is to enable gold to circulate as a currency in global e-commerce. (Story.18682)
Black Blade: Gold.com, Hmmm�.., first e-gold, then goldavenue.com, now��
GOLD MEET: Barrick shares not fully reflecting value, says exec
Palm Springs, Calif.--Apr 17--The share price of Canadian gold mining giant Barrick Gold Corp is not fully reflecting the fact that the company is "making a lot of money," the company's chief financial officer, Jamie Sokalsky told Bridge News. He said that many industries are seeing languishing share prices as investors have moved to "dot coms and tech stocks." (Story .11405)
Black Blade: These guys just can't take a hint! It's called hedging!!!!!!!!!!!!!!!!!!!!!
Gold explorations intensify in western Zambia
Lusaka, Zambia--Apr 18--Explorations for gold deposits in western Zambia have intensified, say recent reports. According to the National Mirror, the mine ministry's senior economist Phineas Zulu said that Phelps Dodge, Caledonia Mining and HJC Mining are among the international firms prospecting in the
region. (Story .12070)
Black Blade: And that said, unlike Barrick, these guys appear to have confidence in their product!
For discussion purposesJust wondering, if S. Africa or any gold producing nation links it's currency to gold, would others follow? Sort of monkey see, monkey do? Or will international pressures come to bear? If one country breaks ranks, then what? Would such an action in itself spark a significant gold rally? How ever it were to go, it would certainly be interesting!
The IMF forbids member countries to link their currencies to gold. The US Treasury controls the IMF -- so they probably would come down hard on any country that broke ranks.
Ptotecting GOLDtedw, you wrote:"It is only a matter of time before they take away your right to own guns. Theyve done it with your other rights, so why cant they do it with that one also."
The answer to that one is pretty obvious bro. To the armed man, government rule is based on voluntary compliance. WE THE PEOPLE are the government. In these western United States gun banners are tossed out of office! Our state constitutions protect the right to bear arms. The tenth amendment of the US constitution protects the states right to do as it pleases as far as guns go. Short of a house to house search, (which is tactically speaking very costly to carry out), as long as people do not comply, gun confiscation is still not possible. Small town cops and national guardsmen are heavily pro-freedom individuals. Any door to door efforts would have to be carried out by "outsiders". With the exception of small spec opts units like Seals, Green Berets, or Spetsnaz the "American Hunter" is the best trained, best equipped, most skilled fighter on the planet. If "peace keepers" come here, we'll be taking their weapons, eating their MRE's, and flying their choppers before their last letters reach home. Why not just march into Somalia and start going door to door taking weapons? Oh sorry, I think Clinton tried that. It seems that they didn't recognize our governments right to do so. Cheer up tedw, as long as you're armed, you are free, man!
Yes indeed. I understand that the IMF would not be pleased. However, if a country were to do so and say the hell with the IMF agreement, then what? Would they try to impose trade sanctions? Call in any markers they may have left on the table so to speak (ie loans, etc.)? Just an interesting thought in regards to Haruko Fukuda's remarks about such a possibility. I would think that this would certainly open a very large "Can-O-worms".
We are seeing more and more disappointment from the "Trader Gold" crowd. Their motives and reasoning is commented on widely by the media and spread over the internet. Often studied as the way a "Gold Bug " thinks, recently the Western investor world sees these examples as a reason to
stay away from gold not buy into it. For years this group was mixed in with all the other "gold bugs" and was considered "one - in - the - same". They are not and only now is the difference becoming more clear.
The distinction between gold stocks, contract gold and physical gold investments is widening as the relative "soundness" of these asset classes is further exposed daily. In the past, as long as all gold vehicle valuations held within a tradable ratio of each other "Trader Gold Bugs" could hide within the "Gold Bug" community and proclaim all the fine attributes of a "physical gold advocate". But
this current protracted political involvement in the gold "paper marketplace" is dividing "Gold Bugs" into their two clear different groups and showing their two clearly different reasons to be in gold.
Over the last three years, Trader Gold Bugs (TGBs) have fallen further and further behind "Physical Gold Advocates" (PGAs) as their leveraged investments are more percentage impacted by a falling contract gold system. No longer able to keep quiet, the pain that their leverage brought them is
forcing an ever more vocal (and irrational) response to the movements in gold prices.
Every $2 drop is seen as a total failure of gold and every $2 rise as pathetic and proving how gold is done in for the count. Truly, these are the perceptions of investors trading either a "Paper Gold Market Place" or a leveraged "Gold Industry". Not the feelings of a Physical Gold Advocate holding a sound world class financial asset! One that's holding it's own strongly in the face of massive
official manipulation.
The TGB crowd is hopping that more of their same kind will soon exit the stock markets and put money in "their kind" of paper assets. All the while ignoring the logic this dictates as it invites the same "hot Money" trading using the same "leverage" that is now failing Trader Bugs. If indeed
contract gold rises $10, $30 or $80 and pulls in some of the stock crowd, that same "fast mentality" will surely run away at the first sign of more official paper gold creation. Further damaging the publics view of Real Gold".
Indeed, the TBG experience is today sinking from it's own exposure to public view. A strategy that takes a 1970s gold precedent and continues to extrapolate it into our future. Yet it is failing from an evolving gold arena. Our gold success for tomorrow will rest on a new and different dynamic not the aging leveraged games of years past.
The precedent for the future of gold is found much further in the past than the 70s. It is a return to natural human economic reasoning of what wealth always has been and is now. This thinking is being helped on by a changing official recognition of what gold should do and be as an asset class
in official and public hands. Taken from a time when Freegold ruled the wealth world, physical gold will tomorrow be the investment of our future from today.
The old TGB experience will go the way of past fads of the investing world as a modern, smart, new investor steps from the fog of all paper leverage failures. Not just leverage gold failures! To their credit new generations do understand when an old investment strategy is little more than the
"old baggage" of their fathers. The event that marks the end of carrying this dollar luggage is an ending currency timeline that is directly ahead. Clean, non leveraged new money is getting ready for it today with physical gold.
Looking ever forward we are today joining a new dynamic force in the world. Physical Gold Advocates are now using sound, responsible reasoning while building a rock solid alliance with the economic builders of tomorrow. The future holds that Physical Gold will not be savings. Nor will not be a hedge. It will not even be an investment.
For those with the courage to follow in the "Footsteps of Giants", gold will be the opportunity of a lifetime!
We (US) need the flow of oil more than anyone else out there! If someone drops the dollar or the IMF we will protect our oil flow even if it means supporting the Euro to do it.
As I drove in to work it struck me that this was going to be a great day. It just feels good, and now, fortified with my daily readings here on this wonderful forum, I am prepared to help make it that way. But first, I would like to throw my few cents worth into the discussions that have been raging recently
Old Gold speaking to your msg#28896, TG beat me to it this morning when he stated at the end of his most recent post that Gold is not an investment for those of us who frequent this particular outpost. I am not buying Gold to sell tomorrow and receive the same worthless piece of paper that I traded for it. I am buying with the intention of trading my fiat for the "wealth of Kings" if you will, before this fiat is valued only in the terms of other paper products readily available in our local grocery stores.
To tedw. We owe it to our forefathers to remember that we do not derive our rights, 2nd amendment, or any other so stated from the Constitution. These rights are "Self-Evident" whether they are on paper or only spoken. They cannot take that which you will not give. I will not give. "They" may take my Gold as soon as they take my rifle, but "They" will only take my rifle one round at a time, or not at all. I shall not relinquish that which was purchased by the blood of my fathers so easily.
HI-Hat 28905 In response to your post let me say Hear! Hear!
Bonedaddy 28915- I couldn't have said it better. There are many, I believe, that when THE time comes, here in the South, will just fade into the forest quietly, and become ghosts that even the SEALS will fear to go in search of, if they(SEALS) do choose to fight on the dark side and against their coutrymen. I hope to have sufficient courage to be one of them. The time has surely come, again, for all good men to come to the aid of their country.
Sometimes the wavelengths are incredibly synchronous. The night before the first cheeseburger Post...No kidding...I dreamt that I was at a fast food joint and looking at the menu board at $25.75 for a burger. In my dream I walked away. 6 billion people on this planet live with an effective income of less than $2 (US). How many of us feel that we could be happy at this income level? There is something to be said for home baked bread and steamed rice with beans. Joy is to be found in places many of us have never looked. My dreams are scarey sometimes. But less scarey than a $75 cheeseburger. perhaps the chees was an extra $50 vs. 50 cents...I didn't get that far down the menu.
I had a vision later of supertankers making their way to the ME loaded with "Water" returning from the ME with oil in a straight barter transaction. duh? Value is relative barter is not commerce. What good doth gold to either region? A store of value as ageless as the earth itself. Surely they cannot bottle the Rhine or the Seine or the Thames or even the Schulkyl (nicknamed the sure-kill in these parts). I say the Amazon holds more promise.
We have a big problem here. What you are saying about gold being the ultimate store and standard of value is directly opposite what the bullion banks say. People like Andy Smith have said over and over that gold is being demonetized and on its way out as a financial asset. You say just the opposite. Clearly one of you is either lying or does not know what he is talking about.
The fact is that people who have followed Andy Smith and shorted gold have made big bucks while people long gold have been massacred -- even those holding just the physical.
Now all this may indeed change someday. But I submit that neither you or anybody else knows when. Perhaps after all on this thread are dead and buried. But so far Andy Smith is batting 1000 anf you are averaging zero.
BTW, my prediction of new lows for gold stock indexes today are coming true unfortunately.
http://www.usagold.com/Order_Form.html4/18/00 Indications
�Current
�Change
Gold June Comex
283.10
-1.10
Silver May Comex
5.16
+0.02
30 Yr TBond June CBOT
96~06
-0~17
Dollar Index June NYBOT
106.33
+0.41
Market Report (4/18/00): So far it's been one of those non-descript days in the gold market devoid of news and
determined direction -- up or down -- but there were some interesting statements coming out of the Gold and Silver
Institute meeting in Palm Springs.
Most interesting is a revelation by World Gold Council CEO Haruko Fukuda that "some countries" are in
discussions with the International Monetary Fund to change the ban on linking currencies to gold. One wonders
which countries those might be with Euroland immediately popping to mind. The euro already boasts a gold
component to its reserves as a further boost to the fledging currency. After all, it is only in England and the United
States that gold fear and loathing inhabits the institutional and bureaucratic mind. In most of the rest world there is
no need for gold to regain its place in the official mindset; it never left. The logical step would be to apply fractional
convertibility. But why would Euroland need IMF approval to move forward? Just do it and drive another nail in that
dying international institution's coffin.
Michael Clark from Fidelitrade makes the point that during the run-up to Y2K fears of the banking system breaking
down and hedging with gold was not confined to "zealots and extremists," but, in fact, had become "mainstream."
We would like to express agreement with Mr. Clark's assessment. Here at Centennial we have rarely encountered
"zealotry", but more a seasoned concern from your typical physician, hardware store owner, plumber and /or
high-tech entrepenuer with respect to hanging onto his or her savings (and an informed and healthy concern about
the national financial condition). The "zealotry" nonsense is a fiction of the mainstream press. When you find out
that the extremist hedging with gold is really "the extremist next door," you realize in a flash that the mainstream
press has an anti-gold agenda. Then you begin to search for the reasons why. Our hats off to Mr. Clark, who
formerly headed up the Wilmington Trust Co. gold operation, for attempting to address a sore subject among gold
owners and put the press on the right track (not that they would succumb to such a real-life observation). I would
say that "zealotry" and "extremist" more closely describes your typical stock investor these days. After all where
would you put the sticker, "The Madness of Crowds" -- on the gold investor or your typical mutual fund owner?
(My apologies to any offended parties in advance.)
Please note the two point drop in the long bond over the past two days. It could be signaling something. While
American fund managers are pumping money into Wall Street, foreigners may be pulling it out -- something which
is showing up readily in the bond market but masked in stocks. That could spell more trouble for the stock market
perhaps later in the week and/or going into next week. This rally looks like its skating on thin ice, my fellow
goldmeisters.
That's it for today, my friends. 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 link above and make the appropriate entries.
Many thanks to those of you who thoughtfully responded to my original post yesterday (and cheeseburger dilemma).
Trail Guide:
If today's cheeseburger will purchase .0036 ounces of gold (1/280), but will purchase .005 ounces in the future (75/15,000), perhaps I am better off keeping some of my wealth in cheeseburgers (very large smile).
Welcome to the great precious metals thinktank. Best bang for the buck? I'd have to say the 10 ounce silver bars from Johnson Matthey or Englehard. But then try to buy 10 at a time. If silver ever runs up to what it's scarcity warrants, then a 10 oz. bar can be exchanged for goods and kind or for cash by the average Joe. The 100 oz. bars are a little too bulky to be carrying around for trade. I get silver rounds before silver dollars because when silver goes way up the people start talking about .999 and the coin silver is .900.
Best to buy through the mail and get a locked-in price with a confirmation number, it's quite safe.
If you ever want to exchange Trader Gold Bug market strategy ideas, feel free to E-mail me at: gazelle333@hotmail.com
This is a great physical gold forum and we should strive to keep it that way. I only want to comment on the markets as they relate to the POG. As gold takes off there will be governments wanting to nationalize the mines they can control. International mining corporations could face serious breakup problems due to political instabilities. The shares are more of a gamblers table than so solid and sound as physical precious metal ownership. Good day in gold to all.
Confiscation..........The confiscation of 1933 was brought on because European banks back then were aggressively accumulating and hoarding gold certificates. When they turned them in for redemption, FDR didn't have enough gold to make good on them so he was forced to collect the gold from citizens. It was a national pillage of the citizenry. Without the bearer gold notes to press the current supply of gold demanded upon the Treasury, I don't see why they would be forced to confiscate. Greed? Sure if they get so greedy then they can confiscate but then that would prove that they fear private gold buying and that could create bigger problems......paranoia...... and the guns and ammo getting burried in oily rags. Not nice.
Today you appear on this forum bashing gold and extolling the sharp perceptions of gold bear propagandist and chronic liar Andy Smith (winner of the '99 Marty Armstrong Full of Shit Award).
Only a few days ago, you were lauding gold and speaking its praises.
You seem to have the mentality of a trader, with no rooted beliefs in anything other than that which makes you profit.
That is fine although you will be doomed to frustration until you firmly believe in one thing or another. Anyway I think KITCO is where you should post with all the other traders. You will be much happier there especially since today most of them are celebrating "Bash Gold Day."
"We have a big problem here. What you are saying about gold being the ultimate store and standard of value is directly opposite (to) what the bullion banks say." oldgold (4/18/2000; 8:47:40MDT - Msg ID:28925)
Oldgold: Well said! You have clearly expressed a main topic of discussion here on this board which has been ongoing since even before the very inception of the board itself. On the basis of this remark alone, you would merit nomination as standardbearer for the traditional, financial industry-inspired gold futures pricing structure and mechanism that we, as holders of physical are intent upon distancing ourselves (and our assets) from.
As we "watch this gold market together" we witness a remarkable process. Anyone with leveraged holdings (even including physical) sees their investment shrivelling before their eyes as the relentless "control" of the artificial, financial industry's creation, the futures-dominated, so-called "gold market" winds the price of gold ever tighter and tighter. Many in the gold community are crying fowl and aledging conspiracy, manipulation and outright corruption.
Perhaps!
Equally plausible may be that our modern, computer-enabled system of derivative-dominated price discovery has reduced the volitility of earlier supply/demand based systems. In either case, the result for leveraged investors has been the same: The legalized pillage of their investments.
Now, as you say, "all this may indeed change someday. But I (you) submit that neither you (FOA) or anybody else knows when. Perhaps after all on this thread are dead and buried." Many of us here suspect that it might indeed be sooner rather than later. However, this difference of opinion in no way validates your incendiary remark that "clearly one of you is either lying or does not know what he is talking about." The merest suggestion of lying or ignorance is offensive to all here when levelled at FOA. Deception, if not outright lying is stock-in-trade for the financial industry and is the very basis of our modern financial system (whose defacto commander-in-chief, Alan Greenspan professes to not even know what money actually is... as per his recent congressional testimony).
Indeed, as you point out, the possibility of a correction upwards in the POG under the current system becomes more unthinkable with every passing day to you, Another, FOA and investors in general. For, "if indeed contract gold rises $10, $30 or $80 and pulls in some of the stock crowd, that same "fast mentality" will surely run away at the first sign of more official paper gold creation." Trail Guide (4/18/2000; 7:00:01MDT - Msg ID:28918). Indeed, the whole system of derivative-dominated price discovery would probably implode in defaults and bankruptcys, should POG move substantially upwards, something that knowledgeable big-money investors are most likely well aware of. Truly a no-win situation. In a word, this is what has propelled gold (as a modern investment) into its present status as a non-investment... a mere commodity, inferior even to pork bellies, heating oil and/or orange juice, etc.
Such a system cannot endure forever. As more and more investors discover its absurdity, it cannot help but change. FOA's writings show in great detail that the next stage in our evolving modern financial system will include a logical and comprehensible place for the eternal value of gold.
Reading your post, I could not agree with you more. You have said what I have been thinking for sometime. As I write, CNBC is showing the DOW up 174.81, and the NASDAQ 201.48. This on what happen yesterday. I've reached a point where I want to chuck this computer, turn off the TV, and just spend my time watching my trees grow. With the trees, at least I know if I water and care for them, they will grow. I do not need to run to this computer and read a dozen different pundits on how trees grow. Being single, owning a small ranch, I spend my days enjoying the land. My greatest joy is to close the day with a cup of coffee in hand walking around my property. My little "trail" thinking about the writings of Trail Guide.
I can not count the number of cups of coffee and cigarettes consumed trying to digest his words. He is profound in his thoughts, I can't agree or disagree with his words, I just don't know. The one thing I do know, I have given up the ability to accomplish objectives due to the holding I have placed in physical Gold and Silver. The shinny metal just sets, one day up a dollar, the next down dollars, the only direction seems to be down. Maybe Gold is dead, or as you said, "we" will be dead before we can reap the gains we are all looking for. Should I "bail" now I will loose, big time. Like most of the members of this forum, we are trapped. Few will admit it but the facts remain the same. Like the stock brokers selling stocks, the bullion dealers are the ones who realize the gains. Yes, MK is the host of this forum and I appreciate that fact. However, should this site disappear tomorrow, a new one will open up. Such is the way of the Internet.
I believe the events of Sunday night were the straw that broke my "will". Even Trail Guide jumped in. Monday looked bleak for the markets, I watched the markets open in Asia forward; RED all RED. It was hard to sleep, asking myself, "Could today be the day?" We all know what happen. Now, today: markets up, Gold down. Yes, maybe it is time to let the metals just set, doing the thing it does so well, collect dust, and attend to my trees, and get on with life. My postponed trip(s) to the Philippines is quickly moving center stage.
oldgold: I give you the benefit of the doubt and of course, your opinions. You must be new around these parts. IMHO, your thinking on the subject is old indeed. Clear out those cobwebs; forget what you think you know. Consider another scenario (There's that word again).
Take a look around sir. The new paradigms abound do they not? Why not a paradigm shift in the gold market?
I believe you are speaking of gold the commodity and gold the tool of opposing political wills. You are speaking of gold in a classic "investment context". Our friend speaks of gold the wealth asset it truly has always been.
This evolution of the gold market had to happen sooner or later. I believe as do others here the trail's end is near and I am glad for my timing.
It appears to me at least, that in your statements you combine both gold physical and gold shares.
I would agree that gold shares,{ especially south africans
gold shares} are down; today some sa mines are down 10%. I guess todays wall street journal article on Zimbabwe
violence suggesting it could spread, might be one reason.
But gold physical is in fact up from it's low of 252,
last year.
Know Thyself: Simple words for sure, but when confused, words
I repeat often.
As I read today's thoughts and feelings here, I sense Deja-Vu of the millenium turnover, as many here felt cheated of an opportunity lost. Looking out the window as I compose this, I see my lovely wife out planting the spring garden. Strawberries in, asparagus in, seeds being sowed, and an aura of total contentment and harmony with her convictions. We live in a moderate mountain environment at about 3000 ft., so the possibility of a late sring freeze is all too real. Happened last year in the latter part of May. It really dissapointed my wife as this was her first attempt at planting a garden in her life.She persevered, jumped back in and we ate millenium pasta on the eve of 2000 with her homemade sauce of her garden fresh veggies.
Pretty simple story (I think in terribly simple terms), however in my eyes, very analagous to the plight of us gold bugs. We plant for a harvest in the future, through the conviction of our "knowing"; not the market, nor the time line, not even the ultimate price yeild. But simply ourselves. For I buy the message of real worth fraught of real labor and love and even death in the effort to produce these fruits.To believe in Microcarp (sp) at 16 times book, with a PE of a zillion to one, and daily capitalization changes greater than the total gross profit of the company, is simply not me. My conviction, no confusion.
So to hold the conviction of why I bought, and will continue to accumulate at these firesale prices, gives me no pain. It is to you Jack (new poster and gardner of today) that I say these words, such that you might avoid the confusion that can kill from within.
This is the most significant news item of the day:
Bank One Profits Sink 40 PercentUpdated 1:55 PM ET April 18, By DAVE CARPENTER, AP Business Writer
CHICAGO (AP) - Bank One Corp. saw first-quarter earnings plummet by 40 percent as fallout from serious problems with its credit-card unit continued to erode profits at the nation's fourth-largest bank.
"Bank One blamed its weak performance on a falloff in credit-card business, more bad loans and an operating loss for its Internet-only bank WingspanBank.com.
Credit-card profits sank to $70 million from $303 million, with credit quality worsening - nonperforming assets increased by $31 million to $1.19 billion. Card loans declined by 3 percent from the same period in 1999."
--------------------------------------
For those who may not know, Bank One has been the most aggressive credit card issuer in America this past decade (via FIRST USA credit cards), providing huge lines of credit ($25,000 and up) to almost any jackass who has a pulse.
No doubt most of those people have been putting most of these credit card advances into the stock market, I know, I've met quite a few of them along the way.
Now the chickens are coming home to roost, and default is simply enormous.
As a result, Bank One is cutting off credit to tens of thousands of people now, and that in effect represents a RAISING of the indirect margin requirements for stock market investors.
As I noted in a previous post, today's average aggressive investor is likely as margined as the average investor back in 1929, all through INDIRECT margin, via house mortgages and credit card advances.
It is one of Wall Street's great lies that a 50/50 margin requirement at brokerage houses prevents overleveraging on the part of today's consumer. Absolutely not true.
In reality, via these indirect margin vehicles, they have never been more margined, and now the firms (like Bank One) who made all this credit available are closing down the loans in a most dramatic way.
Let me say I am no fan of Andy Smith -- the bullion bank propogandist. But he has been right about gold these past few years. Probably because the gold shorts have enormous support from the financial powers that be.
But frankly I am not a fan of Trail Guide either. He writes as if he and he alone is aware of an impending sea change in the gold market This sort of reminds me of cult leaders who proclaim a special vision of the future which almost always turns out to be bogus.
Trail Guide's obvious contempt for gold stock investors also rubs me the wrong way. He seems to be implying that gold stock investors are getting their just "reward". Farfel that is something you should think about having lost so much in gold stocks. I have not noticed a similar contemt for tech stocks investors. Apparently they are entitled to their huge gains, but it is sinful for gold stock investor to hope for a decent return on their holdings.
GATA -- unlike Trail Guide -- is trying to DO something for gold and gold stock investors. We need many more people like Bill Murphy. What we do not need are cult like figures who say in effect -- "follow me and you will some day be rich beyind your wildest dreams when the current system collapses".
Trial Guide or Pied Piper of Hamlen. We shall see which is the better description.
I am sorry if my words offend some. But frank talk is needed if gold investors are ever to get their just rewards.
From Bloomberg:
"Under the Clinton administration's decision, Taiwan will
receive three Raytheon Co. missiles -- the Amraam medium-range
air-to-air missile, a new heat-seeking, anti-ship version of the
Maverick air-to-ground missile and the Javelin anti-tank missile
co-produced with Lockheed Martin Corp., said the defense
official. The exact quantities and prices will be worked out
later."
---------------
Rather hard to fathom that this could be the same company of wolves (with all due respect to wolves) that would endeavor to take away its own citizens pea shooters.
Back to Gold...
My, what short memories we all have. Yesterday and Friday there seemed to be alot of angst expressed here that the price of gold was not reacting more strongly in light of last week's stock market selloff.
It seemed that these same people lost sight of the mechanism through which gold is priced. The "highly visible" paper gold market is the means for price discovery...spot prices then being derived from futures markets based on mathematical adjustments for the time-value of the funds involved, both currency and metal.
First of all, in the midst of a gut-wrenching stock market selloff, how many people instinctively say, "Golly, Francis, this seems like a good time to start playing the futures markets, too."
And even if they DID decide to play the futures at such a time and thereby put pressure on the buying side of gold contracts, how difficult to you really think it would be for those intitutions with vested interest in price restraint to offer up whatever additional gold contracts are adequate to keep the price at bay?
Don't let yourself be deceived by price performance of paper gold. Physical gold demand by the world as tracked by WGC statistics continues unabated at record pace. You can be sure that those individuals who acquire and know the true value of gold metal continue to see the paper gold market as a sublime gift for as long as it endures.
I'm glad to see many posters coming back around to the proper evaluation in their comments today. Truly, past times and observation have revealed the paper gold traders to be sacrificing themselves and their available funds for the benefit of us physical gold advocates that eagerly accept the metal under the paper gold traders' terms of contract price discovery.
Mr. oldgold, I don't think any will disagree with you that the bullion banks have shorted gold for a long time and made a fortune doing so. Gold shares and POG have both suffered as have many involved with mining or precious metals in any way (other than the shorting). I, for one, will also agree that no one knows for certain when POG will rise but I believe many among us have a much greater understanding of the fundamentals and manipulations of both the gold market and gold as wealth (as opposed to paper currency) than many so called financial experts.
In defense of Trail Guide, I don't ever remember him "predicting when" POG will rise. He does state only that it will and the search and challenge,if you will, is attempting to examine all information and opinions available to us towards this end. Weather one's motive in this is to defend freedom, restore the gold standard, oppose market manipulation, make money with the rising POG, or all of these doesn't change the game. If gold stricks you as just a money making investment then I would submit that no other market (other than perhaps silver) has as much potential as the gold market. This is a direct result of the tremendous shorting (manipulation) that you so correctly lament.
There are many "forms" of physical gold, but those offering the most "bang for the buck" tend to be the full one ounce coins, particularly the more popular or well known pieces such as the Krugerrands, Maple Leafs, and American Eagles. These are continually the "most liquid" and offer the lowest premiums over other "numismatic" or less often traded coins, bars, etc. While there may be some slight price advantage up front with gold bullion bars in 10 ounce and larger sizes, many of these generally require assaying when sold which ultimately increases the "cost" of such forms of gold. Also, as the size of the coin decreases (1/2, 1/4, 1/10 ounce etc.), the per-piece premium naturally rises as a matter of increased "production cost" of striking more pieces per ounce of metal. While the smaller coins may be better suited to "bartering" in extreme circumstances, for simply buying and holding, the full one ounce coins would seem to offer the "best of both worlds" as far as low premiums and liquidity. However, in this recent market, it is sometimes possible to buy the smaller coins at or near the same premium levels (per oz.) as the full one ounce coins. In this case, I would tend to go with the smaller pieces simply for the sake of taking advantage (later) of the rising premiums of such coins as the price of gold itself increases. In an "up market", the premium spread of the smaller coins almost always returns with the increase in the POG. Hope this helps.......
+++++++++++++++++++++++++++++++
Others:
Having read most of the postings here over the past many months, and the general consensus of the "need" or "desire" of a higher POG, it makes me wonder if some are simply missing the forest for the trees. Those of us who have accumulated our shares may see some immediate "paper profits" in such a rise in the POG, while others of us still in the "accumulation phase" would do well to continue buying at current (or even lower) levels. Do we really look at gold as a "wealth means" to a "paper end" ? Isn't that what we are trying to avoid in the first place, i.e. the fiat/paper markets ?
How many of us would rush to buy any consumable today if we knew that tomorrow the price would be 2 or 3 times todays price, able to make a large paper (cash) profit in the process ? And once those items were sold, how many of us would immediately be wishing again for "lower prices" ?
Too many of us are putting physical gold into the category of a (physical) means to a (paper) end, when in fact the gold itself should be viewed as "a present ends to future means", or a way of taking our wealth with us through our lifetimes without worry of government taxation, inflation, ad nauseum. Do we simply "buy" gold as an "investment", to be "sold" for dollars, or is it the gold that we will use as the ultimate means of exchange at some time in the future ?
A couple of days back, the topic was brought up as how to illustrate or convince others (family members ?) of the merits of physical gold ownership. Try taking a bit of wadded up newspaper, a piece of wadded up copy paper, a piece of wadded up toilet paper, and a dollar bill and laying them side-by-side. At the end of the row of paper, place a one ounce American Gold Eagle (or other gold coin), and watch the expression on the face of the other person without having to say a word yourself. Any thinking person will fully understand..........
"GATA -- unlike Trail Guide -- is trying to DO something for gold and gold stock investors."
TG's posting here IS doing something for gold and gold stock investors. We all have our way. His reasoning seems sound to me on most points.
Are you saying that you disagree with his thinking that our monetary system will change in the near future? I'm more interested in hearing your reasoning rather than the name-calling.
Let's hear your views, and we'll let future events decide who is correct. What is your "frank talk"?
The TG/FOA message is about a sea change in the international monetary system as we know it. Gold's rise in price will be a bi-product of unfolding world monetary events. Certainly, the counsel given could be construed as investment advice because, if you part with dollar wealth by subscribing it to another form, you expect a return on your subscription along with the original sum.
As the world turns slowly it covers a lot of ground. I am delighted to have an insightful perspective on current monetary events as they unfold for the case for gold is entirely MONETARY.
Consider....
TITLE: International Monetary Infrastructure Evolving
SUB-TITLE: Gold To Play Customary Role In New System
The faithful are asking for a sign. I say keep the faith. It could be a long wait still.
Why Barrick is NOT worth a piece of Toilet Paper....
``One of the things as an industry I don't think we've
been terribly good at is marketing our product. We
pour a piece of bullion and often from a producer
point of view that is where it ends,'' John
Carrington, vice chairman and chief operating officer
of Barrick Gold Corp(Toronto:ABX.TO - news) told
Reuters.
--------
When a major executive of a major senior gold producer (that pretends to be a gold bull) comes out with an idiotic statement like the preceding, then it is all I can do from barfing all over my shoes.
Several years of the most dismal gold market, after numerous gold producer bankruptcies....after many shareholder protests against gold producer inaction to promote their primary asset... after endless GATA pleas to these lamebrains to do something to bring transparency to the gold market and support a REAL gold lobby group...this Barrick-bird-brained idiot, this moron piss-brained executive, steps forward and declares he thinks that maybe it is time to promote their product differently?????
Is it any wonder shareholders have had enough of these sub-retarded jackasses?
When your proxies arrive in the mail, VOTE AGAINST all gold producer managements...Vote AGAINST all gold producer proposals...send these nitwits a message in no uncertain terms for the upcoming gold producers' annual meetings.
Old gold please do not discourage your gold brothers this is the same as people who mock the efforts of Bill Murphy � we all have our roles to play. Also you do your fellow students of this university a disfavor by inferring we are lemmings. All gold supporters must unite especially in apparently dark times.
Trail Guide brings a truly unique and challenging perspective to events that I am sure is preposterous heresy to paper gold aficionados and lovers of the Dollar Empire (on which the sun will never set!)
I have watched paper gold players like myself (yes I also sometimes take our national lottery tickets as well) go from giddy euphoria to deep misery and disillusionment. The same rollercoaster of emotions applies for gold shareowners.
I post from South Africa where there are a few crazy demented old prophets many who dream of the golden heydays of our country and currency. We even have a number of closet goldbugs among the financial journalist community who try and stick up for gold in an obtuse way.
But we are all cast into the slough of despond when newspapers front pages have quotes that gold is no longer a safe refuge etc.
Strangely for our Kruger holdings we don't suffer the same symptoms � maybe the coins emit a strange constant comforting golden glow of promise. This emanation is a proven antidote to goldphrenia (closely related to techphrenia) the condition of becoming morbidly depressed and full of dark paranoia of immense conspiracies when hopes of making huge paper profits evaporate.
I have carefully attended professor TG's (FOA) lectures for a number of semesters (nearly 2 years) and am an unashamed fan. His position on gold shares as I understand it is that governments - in a scenario of enormous gold price escalation, dollar meltdown and currency wars - might just be ever so slightly tempted to tax gold shareholder revenues (of course, purely windfall and comming from national treasure chests from their perspective).
TG I relish your walks in the mountains �they are some of the most stimulating on the whole gold debate on the web. They leave my mind spinning with possibilities and I sleep soundly. I am glad you have your own site then brother gold bugs who like the alpine air can go there and others who dislike the munitions under no obligation to join the pretty grueling hikes you take us on.
Old gold the Lord Jesus said, "he who is not against us is for us" so let's not get personal against fellow goldbugs theories � there are so few of us at this time anyway.
Chrusos � holder of physical, dabbler in shares and options
Old gold please do not discourage your gold brothers this is the same as people who mock the efforts of Bill Murphy � we all have our roles to play. Also you do your fellow students of this university a disfavor by inferring we are lemmings. All gold supporters must unite especially in apparently dark times.
Trail Guide brings a truly unique and challenging perspective to events that I am sure is preposterous heresy to paper gold aficionados and lovers of the Dollar Empire (on which the sun will never set!)
I have watched paper gold players like myself (yes I also sometimes take our national lottery tickets as well) go from giddy euphoria to deep misery and disillusionment. The same rollercoaster of emotions applies for gold shareowners.
I post from South Africa where there are a few crazy demented old prophets many who dream of the golden heydays of our country and currency. We even have a number of closet goldbugs among the financial journalist community who try and stick up for gold in an obtuse way.
But we are all cast into the slough of despond when newspapers front pages have quotes that gold is no longer a safe refuge etc.
Strangely for our Kruger holdings we don't suffer the same symptoms � maybe the coins emit a strange constant comforting golden glow of promise. This emanation is a proven antidote to goldphrenia (closely related to techphrenia) the condition of becoming morbidly depressed and full of dark paranoia of immense conspiracies when hopes of making huge paper profits evaporate.
I have carefully attended professor TG's (FOA) lectures for a number of semesters (nearly 2 years) and am an unashamed fan. His position on gold shares as I understand it is that governments - in a scenario of enormous gold price escalation, dollar meltdown and currency wars - might just be ever so slightly tempted to tax gold shareholder revenues (of course, purely windfall and comming from national treasure chests from their perspective).
TG I relish your walks in the mountains �they are some of the most stimulating on the whole gold debate on the web. They leave my mind spinning with possibilities and I sleep soundly. I am glad you have your own site then brother gold bugs who like the alpine air can go there and others who dislike the munitions under no obligation to join the pretty grueling hikes you take us on.
Old gold the Lord Jesus said, "he who is not against us is for us" so let's not get personal against fellow goldbugs theories � there are so few of us at this time anyway.
Chrusos � holder of physical, dabbler in shares and options
Hey oldgold, what crawled up YOUR portfolio and died?
As evidenced by some of your posts today, your thinking seems to be a bit clouded. Though far be it from me to do your thinking for you, I can't refrain from offering you a few thoughts.
Your comments about Trail Guide are completely without substance. Completely. I should leave it at that, but I won't.
I have followed his thoughts for as long as he has been sharing them on the internet and have found them to be singularly unimpeachable. Further, unlike your own perception, I do not detect any element of contempt in Trail Guides words for ANY faction participating in this grand financial/monetary evolution. If I have ever seen an expression of contempt, it is for those who fail to conduct themselves in a courteous manner when exchanging words on this subject matter. If you see contempt, perhaps it is because you are donning that garment of your own self-incrimination and then see its reflection in the virtual edifice of Trail Guide's thoughts. So if Trail Guide holds no contempt for the actors that are providing us with low purchase prices for Gold, why would he suddenly have contempt for those who are throwing themselves on the spears of bad investments...such as corporate goldmine investment might reveal itself to be as events unfold in a presciently forecasted scenario where a reserve currency loses its status and the paper gold contract marketplace comes unglued?
Further, he does not come across as imploring others to "follow me and you will be wealthy beyond your wildest dreams." On the contrary, he firmly encourages others to consider his words and to do their own thinking. Not surprisingly, some people are better at it than others--no offense intended. Where you say, "GATA -- unlike Trail Guide -- is trying to DO something for gold and gold stock investors," you just don't get it, do you? There are innumerable ways to "make currency"--and perhaps the efforts of GATA will somehow bring various corporate goldmining investments into the black. But there is only one way to "make the currency of the ages" --that is to say, to "make Gold." As millions of others on this planet know, fiat currencies don't retain their vigor forever, and "making Gold" requires regular and timely exchanges while your currency holds its value. The alternative is to either EARN the Gold directly in payment for services rendered (NOT going to happen in a modern world on any grand scale), or else to FIND the preciously rare Gold directly as the miners do. I submit to you and to all others, while the paper Gold market price discovery reigns supreme (as superbly described in Townie's latest post), it is much easier to "make Gold" by buying it with currency than by mining for it. After all, any old fool can "make currency."
"...frankly I am not a fan of Trail Guide either. (His) obvious contempt for gold stock investors rubs me the wrong way. He seems to be implying that gold stock investors are getting their just"reward"". oldgold (4/18/2000; 13:27:18MDT - Msg ID:28939)
Dear Oldgold,
Please correct us if you have not been more closely associated with one G. C. Cole than with Mr. Tzadeak?
As you point out, FOA/Trail Guide/Big Trader/Another has always been strictly an advocate of unleveraged physical holdings rather than stocks of any kind. This should cause you no discomfort, unless you truly believe that the "messenger should be liable for the content of his message" as in bygone imperial times. That you seem unable to let go of your love of gold stocks in the face of FOA's disaproval is your choice, and does not in any way reflect on the good intentions of FOA. A more noble way to react on your part, would be to bring us your reasons for continueing to value gold stocks, speaking to FOA's arguments rather than voicing a general distaste for him. His reasoning has been carefully laid out here for all to see. If you are at all unaware of it, you should direct yourself to the archives.
At the same time, you, yourself point out that part of your dislike of the messenger is that "he writes as if he and he alone is aware of an impending sea change in the gold market". Yet all here know that FOA has continously pointed us to many other seers who have been offering the same message, including Reginald Howe, World Gold Council, Michael Kossares, GATA, etc. In addition to being flat out incorrect, yours is a thoroughly childish attitude to take towards FOA. Between the lines, your point of view calls out for some special recognition for yourself, even as you disregard that your identity as "oldgold" leaves out all the content of a George C. Cole's identity as newsletter editor and expert who might have spent a lifetime acumulating fame and respect for past analysis. FOA/Another has carefully shielded us from any such clouding of his message by steadfastly refusing to identify himself. In the format he has chosen, this only adds even more weight to his words, although it utterly fails to capitalize on any success his analysis might eventually have... a completely unambitious modus operendi for an aspiring "cult leader". FOA/Another's motives have caused much speculation since their first appearance at Kitco. The only motive that reamins undisputed is a desire for knowledge, and at the same time, to make truth known.
If any of this this indeed "sort of reminds (you) of cult leaders who proclaim a special vision of the future which almost always turns out to be bogus", you are certainly encouraged to follow your own path, without regard for FOA's guidance. You, yourself will reap your own benefit or loss for your decision. In the meantime, here at this forum (as opposed to some of the others) we, especially including FOA, concern ourselves with reason, content and valid argument directed strictly towards the message, which is hardly the tactic of a cult leader looking for a following.
If that is in any way your own dream, which your offence at this mistaken interpretation of FOA/Another's motives causes one to suspect, you will find very little sympathy here at this forum.
Somebody said that I posted malicious comments about him, as per the following post:
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Farfel (4/17/2000; 18:09:03MDT - Msg ID:28876)
A Trader Speaks Out, and I Respond....
A trader wrote on another forum:
"Many of the people who post at _______ are looking for something to "believe" or they are trying to get others to believe what they do.
Those of us who are looking for something to trade and do not feel that "believing" in anything is necessary for trading are looked upon as monsters or worse.
I have noticed a trend in the USA and here at ______ of people trying to severely HURT someone just because they don't agree with them or don't like what they think. They try to cost them their wealth, their job, their friends and their freedom ( by false accusations or by framing them in some manner ) . People worry about hate crimes and persecution because of hatred yet I see those same people spew hatred at people just because they disagree about what is money or what is fair or not fair in business and government.
If we really do have a great crash and the wealth of the average person disappears I fear a blood bath as people give their hatred free reign......
Freedom of speech and tolerance of another's beliefs are a bad joke in America today."
---------
I find the sentiments expressed by this trader to be singularly baffling.
He makes an impassioned cry for tolerance and asks that those who trade without beliefs be looked upon with understanding and without prejudice.
Unfortunately, that type of mentality is the root cause of the moral breakdown in this country. Momentum trading and making money for the sole sake of making money, without goal or without purpose or any conception of morality, is the reason the country is beset by hatred and rage. How strange that this trader cannot see that! A life based solely on materialism cannot be ultimately satisfying.
A trader's universe is singularly and entirely immoral. A pure trader who does not give a damn what his product is or where he invests his money does not realize that every time he makes an investment, he is voting for or against a certain condition in the world.
If I choose to invest in child pornography, then even if I only hold the investment for a day, I make a vote as to what kind of society I want.
If I choose to invest in a defense company, I make a vote as to whether or not I wish to have somebody's arms blown off or not.
Etc., etc.
So when a pure trader appears and demands tolerance and understanding for his spiritless activity, I am sorry but I will not give you one scintilla of that.
If you do not make a moral choice, then I will let you have it in no uncertain terms, and to hell with so-called freedom of speech or freedom of choice.
Because freedom unfettered leads to tyranny of the human spirit. Too much freedom is as bad as too little freedom, one oppresses as much as the other.
Thanks
F*
-----------
However, I wish to make it clear that this post was NOT intended to imply the man is a dirty rotten pedophile, I would NEVER make such a claim. NEVER!!
The preceding was aimed at another man's comments about the glories of trading for the sake of trading, that is all.
Today's discussion reminded me of something Jesse Livermore said in "Reminiscences of a Stock Operator". It's been a while since I read it, so this may not be paraphrased perfectly.
Jesse commented that after he became famous on Wall Street, people always asked him for a hot tip to make a quick buck. This struck Jesse the wrong way, because when he was inexperienced, he learned quickly that hot tips were wrong 50% of the time. What he wanted was to learn the ropes from experienced traders, not a hot tip. Jesse concluded this is one of the reasons why the masses are always wrong. People want to be told what to do and will throw money at a investment they know nothing about, instead of doing work and research.
So everybody here needs to ask them themselves a question. Are you reading this forum for a way to get rich quick, or do you want to learn how the world really works?
Ross L says
"So everybody here needs to ask them themselves a question. Are you reading this forum for a way to get rich quick, or do you want to learn how the world really works?"
Good point.
This statement should be taken as a wake-up call to many, especially myself, and I know for a fact that there are countless other people who think like me in this respect, so they should think hard about it too.
Of course, many of the posters here already have, but I am sure some lurkers could take note...
http://www.gold-eagle.com/editorials_98/osborne061898.htmlI would be interested in reading what Trail Guide (or anyone else with an informed opinion) thinks of the hypothesis put forward in this link.
It gives a whole new perspective to the manipulation of Gold.
Chrusos, what you've said so well here is the point I was implying at the end of the third paragraph in my previous post:
"...gold shares as I understand it is that governments - in a scenario of enormous gold price escalation, dollar meltdown and currency wars - might just be ever so slightly tempted to tax gold shareholder revenues (of course, purely windfall and comming from national treasure chests from their perspective.)"
Nice work, chief. And further on that, we can all gain sume perspective in the realization that a potential for nationalization of mines would occur not because the government has its eye on the currency it could make as a result (they do that already), but because of the value represented by the metal itself.
Mining companies would do well to adopt this same perspective of their product. Fundamentally, with paper Gold markets on the wayside, there is no reason mining companies shouldn't be able to support themselves on the basis of their product--selling it as needed to cover expenses or to disperse profits. (Though personally, if I owned a Gold mining company that paid dividends, I would rather receive those dividends directly as a metal allocation to a Gold pool maintained by the company. But then, that would make too much sense.)
I believe it was the apostle Paul who said "In all circumstances, I have learned to be content." I think he was imprisoned at the time and awaiting trial and probable execution. My my my, what a lesson for living for all those who have shared lately, their depression, whining, anger, disappointment, and resentment on the various gold forums. To all of you I say, something significant is missing in your lives and getting rich is not going to fill the gap or make you happy. You are distracted by the stock market and the gold market and that distraction is sucking the life out of you.
Truly, this is a case of the glass being half empty or half full as is applied in cognitive therapy. I can say "damn, the price of gold dropped (for what ever reason) and my plans for greater riches aren't coming to fruition" or I can say "Hmm, I can afford to buy more gold than I expected because of the recent price drop. Interesting." For you psychology students out there you know that which of the above you choose to say/feel/believe will determine your emotional state of mind and, consequently, your behavior.
I'll go even further and ask you to honestly examine yourselves regarding your innermost motives regarding your behavior which I find to be totally inappropriate for this noble forum. If you look hard enough and are honest enough, you'll find that which is so apparent...it is greed! It ain't pretty but it comes to the surface quickly and it sure is obvious and there is nothing noble about it! I can't help you with it, rather it is something you're going to have to resolve on your own...if you choose to do so.
As for me, while I find it all very entertaining, I don't really care what the stock market does, what the euro does, or what the price of gold does...simply because I can't control any of it! Perhaps it is the realization that there is very little we can control that gets one on the right path of life.
I choose to see the glass as half full and I will continue to take every advantage of today's ridiculous gold prices and acquire as much physical gold as is financially practical for as long as I can. Oh, what's that you say? What if the price doesn't go up for twenty years? My children inherit all of it (tax free I might add). Along with the teaching of values that matter, like integrity and morality, I can't imagine a better, more consistent, more appropriate inheritance from a common man such as myself to his children.
Sir Trail Guide if you please....In the context of your general discussion of how the world works and is working, would you be kind enough to view the referenced link by Sir Econoclast and give us your opinion. This would be a fresh topic would it not??
A reference was made today at another (no pun) site regarding a secret hoard of US gold somewhere in the western US (probably Centennial Precious Metals Executive water closet) :):). Could US accumulation be a fact? It woudl be a good DEFENSE would it not?
Just sneaking a late work-day peek at the forum before a more leisurely (ha!) reading tonight.
RE: oldgold
As Cavan Man said: "The TG/FOA message is about a sea change in the international monetary system as we know it. "
If you read about the past such changes they always came as a shock to the populace at large. They were kept under wraps, sprung as surprise, and trapped most people with most of their assets vulnerable to "theft" by one means or another. SECRECY is ESSENTIAL to such "sea changes".
Just the possibility that we "common folk" are being let in on advance views of such changes is exhilarating, and oldgold wants to warn us that they are illusory and cultish. I know the attraction to "insider" information, and I know the pessimism that he wants to share with us, possibly for our own good. That we have that weakness for an "insider's" perspective does not make that viewpoint false. Only that, as in all things, we must be suspicious of ourselves and not become our own worst enemy, as in "A fool and his money..."
FOA isn't selling anything and he certainly isn't profiting from our walks together. He sounds to me like he is drawing satisfaction from the sharing of a lifetime of knowledge, something I hope to do in years ahead. The satisfaction of drawing together a school of independent THINKERS is also sublime beyond most human accomplishments.
The only truth that can be said about TG/FOA's "prophecies" is that they are about the type of thing that is kept secret until it happens. Thus, any proof will only be available after it happens, when preparation is no longer possible. It's pretty much an all-or-nothing deal.
So, you -- each of us -- have to figure your own risk/reward. What's the upside? What's the downside? The math looks pretty convincing to me: GET PHYSICAL.
Besides, the hikes with him are fun! Reminds me of a favorite economics professor (with a beautiful Scottish accent) I never let myself spend enough time with. Now the sheer indulgence in learning is compensation enough for quite a period of market "stagnation".
Taking the long view. Learning from European financial pros with centuries of tradition and, hopefully, wisdom. Learning from "giants" (whoever they may be.) Thinking of wealth as something possible in our future. Growing out of our little American childish instant gratification game and growing up as investors.
To repeat (and hopefully not bore): This is the type of situation that could POP to the upside all at once. It certainly ain't gonna pop downward anymore. A steady rise would be a fine alternative, too. A level price for a few yars? OK -- what if stocks, bonds, drop 20% and stay there? Tell me a better alternative "investment" to hedge an inflated money supply of the past five years?
Damn! Gotta go pick up the kid -- that's probably my rant for the week.
The Week in Gold has been updated! ...Gold Demand remains UP!
http://www.usagold.com/wgc.htmlFor those of you that might yet doubt that others in this wide world are capitalizing on physical gold acquisition at these paper-based prices as we mentioned in our previous post from The Tower, please doubt no longer. I refer you to these excerpts from the World Gold Council's Weekly Gold Market Commentary released today.
"Gold imports into Turkey surged to 52.5 tonnes during the first quarter of this year, up 219 per cent from 16.4 tonnes for the same period of 1999. Increasing investment demand in the local market, expectations of a good tourist season and good prospects for higher jewellery exports were cited as the main reasons behind this jump."
+
"In Taiwan, imports of gold bars and coins in March rose 19.44 per cent to 9.572 tonnes from 8.014 tonnes a year earlier. For the first quarter, gold imports totalled 23.921 tonnes, 33.25 per cent up from 17.951 tonnes for the same period in 1999. "
And is this evidence that the prevailing paper-based gold markets are falling out of favor?
"The LBMA reported that London's net gold clearing statistics fell during March as trading ranges narrowed and volatility declined from February's levels. The number of ounces transferred fell 19% to a daily average of 24.2 million ounces (752.7 tonnes), which is the second lowest level on record."
What is more, the Swiss will likely forsake these conventional markets or UK-style open auctions, with the most likely gold allocation scenario to follow the Dutch model via the BIS.
"The Swiss National Bank (SNB) announced on Wednesday that, as expected, it will start its programme of gold sales in early May. These sales, which are governed by the Washington Agreement on Gold, are planned to reach a total of about 1,300 tonnes. The SNB said the method of sale would be announced nearer the time, but the Swiss sales are thought unlikely to involve auctions as is the case with the UK's current programme. The Finance Ministry said that the SNB would co-ordinate the sales closely with other European central banks."
These might all seem as tiny pebbles, but the keen eye may yet detect the impending avalanche. Build your financial house on a solid foundation.
One big problem I have with trail Guide is that no other gold analyst in the word -- bull or bear -- accepts his premises. The idea that this lone individual knows hidden secrets that no one else does is implausible to say the least.
The idea that the US is headed for hyperinflation is so far out that I cannot believe even Trail Guide takes it seriously. Major powers historically only suffer hyperinflation after major wartime defeats. And the US -- as the world's only superpower -- is hardly likley to suffer a major military defeat within our lifetimes.
This is not to say that inflation will not pick up considerably in the years ahead. But hyperinflation in the US -- the very idea is absurd.
The idea that the Europeans will make a bid to dethrone the dollar alos is very implusible. When the US says jump -- most of these guys say -- "how high". The European CBS are the ones selling and leasing gold and driving its price into the ground. Could it possibly be that they are doing so at the behest of the US?
I do fault GATA for focusing too closely on Goldman Sachs. Bad as they are the root of the problem is the cheap gold from CBs (mainly European) flooding into the market. Goldman Sachs and its fellow "Hannibals could never do what they are doing without dirt cheap leased gold from the European CBs.
The Washington Agreement did cap European gold leasing, but at a very high level. Can one imagine what gold and gold shares would do if the European CBs announced they would start to PROGRESSIVELY REDUCE gold leasing -- say by 10-20% a year. This is what gold activists should be aiming for -- repeating over and over how bad Goldman Sachs is will not do us any good. THE SUPPLY OF CHEAP LEASED GOLD MUST BE CUT IF A GENUINE AND SUSTAINED GOLD BULL IS TO EVER DEVELOP.
One big problem I have with trail Guide is that no other gold analyst in the word -- bull or bear -- accepts his premises. The idea that this lone individual knows hidden secrets that no one else does is implausible to say the least.
The idea that the US is headed for hyperinflation is so far out that I cannot believe even Trail Guide takes it seriously. Major powers historically only suffer hyperinflation after major wartime defeats. And the US -- as the world's only superpower -- is hardly likley to suffer a major military defeat within our lifetimes.
This is not to say that inflation will not pick up considerably in the years ahead. But hyperinflation in the US -- the very idea is absurd.
The idea that the Europeans will make a bid to dethrone the dollar alos is very implusible. When the US says jump -- most of these guys say -- "how high". The European CBS are the ones selling and leasing gold and driving its price into the ground. Could it possibly be that they are doing so at the behest of the US?
I do fault GATA for focusing too closely on Goldman Sachs. Bad as they are the root of the problem is the cheap gold from CBs (mainly European) flooding into the market. Goldman Sachs and its fellow "Hannibals could never do what they are doing without dirt cheap leased gold from the European CBs.
The Washington Agreement did cap European gold leasing, but at a very high level. Can one imagine what gold and gold shares would do if the European CBs announced they would start to PROGRESSIVELY REDUCE gold leasing -- say by 10-20% a year. This is what gold activists should be aiming for -- repeating over and over how bad Goldman Sachs is will not do us any good. THE SUPPLY OF CHEAP LEASED GOLD MUST BE CUT IF A GENUINE AND SUSTAINED GOLD BULL IS TO EVER DEVELOP.
I'm still trying to figure out how the world really works. I'll let you know what I find out. Sorry, I would have gotten back to you sooner with this informative tip, but I was out buying a lotto ticket.
Suppose for a moment you were a Central Bank......
....Would you "sell" your hard assets (gold) for another commodity that you could easily create out of thin air (U.S. Dollars) ? This has probably been mentioned by others, but where is all of this gold being "sold" by the Central Banks ? Is it entering the (private) markets as physical, or is it simply more of the illusion, actually consisting of nothing more than bookkeeping entries from one CB to another ? The "numbers" don't seem to add up for some strange reason.
I agrre with you whole heartedly on the last paragraph of your latest post about it being cheaply leased CB gold that the "hannibals" are using to work their "magic". Yes I think even Bill is coming into this line of thinking as well.
However, it has occurred to me that it may also suit the European CB's strategy that gold "paper" have the lead in establishing the price of physical for this period of shuffling, accumulation and consolidation. See that by your own words you have acknowleged that the European Central Banks are now in complete control of the situation and are in fact holding the detonator. (Lease level reductions). Isn't that where you would want to be while accumulating and redistributing gold assets about your domain before you made your play to offer the reserve alternative? Holding the detonator so to speak? It has the strange feel of a pair of vulnerable testicles wouldn't you say?
Does not the mere exchange of physical gold at these "low" prices not legitamize the concept that gold is now worth more than $42 an ounce? Remember for every sale there is a buyer. The glass IS half full, no?
If I were coming into this discussion today or even recently and had not yet read the "Thoughts" by Another. I might even give your position a moment of consideration. Fact is the predictions made by Another in those posts (see archives) written years ago have come to fruition and right on the predicted schedule. That in itself gives the Another/FOA thread credence head and shoulders above the rest.
I think you will find that we are not on different sides of the valley.
But I still think we could trade water for oil even up.
ss of nep (4/18/2000; 7:26:20MDT - Msg ID:28921)
comment
I may have to learn to ride a camel
smile.
------------
Ha! Ha! Hello ss of nep,
I hope you have some success because those damn things are hard to ride. For this American anyway! (smile)
You are right, we do seem to be more free with our military these days. It just feels like we are slipping into the same old "pre inflation" society values that are responsible for "war attitudes" in the past. Our Economic engine pulls all of us into it's high speed printing press whirl and we end up demanding the head of any peoples (or nation) that slows it down. I see moral values at the very edge of the same old "I demand mine now" and "to hell with the outcome" thinking. It more profitable to trade it than own it! Didn't Robert Precter detail some of this in his last book?
Anyway, good luck when your first ride comes!(smile)
Imagine yourself living in Turkey and trying to achieve meaningful savings
http://www.usagold.com/goldenchalkboard/gc_turkey.htmlAlthough the steepness of the line will vary, someday this is what all currency graphs will look like versus gold. As was mentioned in an earlier post regarding 1923 Germany, do you think the goal of the average person was to accumulate ever more currency?
Let this be your guide...
"Gold imports into Turkey surged to 52.5 tonnes during the first quarter of this year, up 219 percent from 16.4 tonnes for the same period of 1999."
Cavan Man (4/18/2000; 7:44:54MDT - Msg ID:28923)
Hello Trail Guide
Is Trail Guide/FOA more than one person?
Hello Cavan Man,
No, I'm the two of them. Because FOA interprets, transcribes and publicly represents the thoughts of another poster, I found myself unable to express (and defend) my own position when attacked or challenged. It's a cultural gulf that's different from what we know in a lot of Western social
interaction. Here I post as Trail Guide so as to still tie my personal feelings to those presented on the Gold Trail, but write as I see fit.
Another seldom writes "outright". Most of his Thoughts (I'd say more than 3/4) are transcribed. He's a long term thinker / planer / leader and has every intent on seeing this "new gold market" through to the end. Many people think his whole presentation is winding down because he has withdrawn for a while. I can assure you the last few years were only an "outcry" of what is to come. When events lead the way, FOA will fade to the background as Another's Thoughts again
take the stage. At least this time, I'll be able to continue posting here as Trail Guide (smile).
da2g (4/18/2000; 9:13:22MDT - Msg ID:28928)
in the future (75/15,000), perhaps I am better off keeping some of my wealth in cheeseburgers
(very large smile).
da2g,
Ha! Ha! I wondered if anyone would catch that? At that evolving ratio burgers would be sold for oil, I'm sure! (smile)
PH in LA (4/18/2000; 10:58:39MDT - Msg ID:28932)
Evolution! Coming to a gold market near you!
Hello again PH!
Thank you for your clarity! But more so for showing that yourself and others are seeing through the fog. I can present only "so much" because my human inability to describe this evolution is so limited. Truly, the more that others can see these changes and write their perceptions the more we all can gain perspective.
Some people say that there is no such thing as coincidence--that what appears as random is really a well-orchestrated piece of a larger puzzle. I have been mulling over various conversations that I have had with clients here at Centennial and have put together a list of events which, in the big scheme of things, are all connected. And there is a certain energy or synergy that accompanies them. So here is the list.
April 19/20th appears to be a key time frame in world/political events. To wit: 7-year anniversary of the Waco tragedy; 1-year anniversary of the Columbine school shooting; 5-year anniversary of the Oklahoma City bombing; anniversary of Adolf Hitler's birthday; the last day when the Swiss people can block by referendum the sale of 1300 tonnes of the gold that has backed a percentage of their currency. April 19/20th is also the beginning of Passover. The next day is Good Friday followed by Easter Sunday on April 23rd. Then on May 1st we have May Day which is occultic in origin (second most holy day in the occult next to Halloween) and which is also celebrated as the key day in Communism ideology. Then finally, we have the planetary alignment on May 5th when all of the planets line up in a row. Apparently this has not happened in 6000 years.
Taking all of these pieces as a whole, I would say that we are in for a whole lot of shaking--economically (lower stocks and higher inflation), politically, environmentally (both weather and potential terrorist acts) and perhaps spiritually. The events of the past two weeks show the nervousness of the investing public when it comes to stocks. I just really sense that the shift has begun and will pick up speed as we head into summer. How long before John Q. Public decides it is time to buy a little gold?
"One big problem I have with trail Guide is that no other gold analyst in the word -- bull or bear -- accepts his premises. The idea that this lone individual knows hidden secrets that no one else does is implausible to say the least."
Are you sure that no other analyst in the world accepts his premises? I personally know others elsewhere who accept this. It's true that many of "western thought" (thanks to ANOTHER for that term) do not believe in TG's scenario.
"The idea that the US is headed for hyperinflation is so far out that I cannot believe even Trail Guide takes it seriously. Major powers historically only suffer hyperinflation after major wartime defeats. And the US -- as the world's only superpower -- is hardly likley to suffer a major military defeat within our lifetimes."
In the 1780's it was the winner of the American Revolution who was blessed with hyper-inflation. During the Civil War both combatants experienced hyper-inflation. Is it loss through war or is it an overburdened monetary/debt system in general that leads to hyper-inflation? You might find an answer in the history books of China.
"This is not to say that inflation will not pick up considerably in the years ahead. But hyperinflation in the US -- the very idea is absurd."
I believe the dollar has already been hyper-inflated. We merely haven't seen the inevitable effects of this to date.
"The idea that the Europeans will make a bid to dethrone the dollar alos is very implusible. When the US says jump -- most of these guys say -- "how high". The European CBS are the ones selling and leasing gold and driving its price into the ground. Could it possibly be that they are doing so at the behest of the US?"
The Europeans' bid to dethrone the dollar is happening right now before our very eyes. Reference the Euro.
"The Washington Agreement did cap European gold leasing, but at a very high level. Can one imagine what gold and gold
shares would do if the European CBs announced they would start to PROGRESSIVELY REDUCE gold leasing -- say by
10-20% a year. This is what gold activists should be aiming for -- repeating over and over how bad Goldman Sachs is will
not do us any good. THE SUPPLY OF CHEAP LEASED GOLD MUST BE CUT IF A GENUINE AND SUSTAINED GOLD BULL IS TO EVER DEVELOP."
Leased gold is not gold. It is paper. European CBs (other than UK) are no longer selling their physical gold into the market. They are selling to other central banks. This will be more obvious when the Swiss announce the details of their sales. The thrust of TG's argument is that the real value of gold has been disconnected from its paper price. Those who engage in paper transactions just don't realize it yet.
This happened before during the late 20's when our monetary authorities engaged in this kind of excessive monetary expansion. The result was a run on America's physical gold which the Fed attempted to stop by slamming on the brakes in 1930-31.
It occurred again in 1965-71 forcing Nixon to default on gold payments to foreign governments. Nixon's action was a direct response to a request by the UK to convert up to $3 billion. Britain's request was precipitated by the nationalization of Venezuela's oil industry on July 31, 1971.
What does our current dollar monetary system have to do with gold? Officially, nothing. Unofficially, much more than we think, in my opinion because, regardless of how much our appointed officials deny it, to the world gold is still money.
In Msg ID:17, FOA refers at the end of the coming Hyper Inflation of the Dollar. As just a ordinary guy I would like to ask the forum for comments on how this inflation would effect the ordinary guy with no real savings and a payday to payday existence. Would it just mean raises in the price of things? What about debts? Could banks call in loans secured by property? I recall in the Movie, Roll Over that when the Arabs pulled all of their money out of US Bonds prices went hyper but then so did wages. Is there anything that the ordinary guy can do to prepare for the coming fall of the Dollar?
oldgold: Re hyperinflation only after wartime defeat
The world is full of U.S. dollars. Many countries accept them more readily than their own currency. Others hold U.S. government debt. It only seems to return in the form of equity market investment if at all. All this while the dollar remains strong and the markets profitable.
What would happen if the markets showed weakness and the dollar's value trended lower? Foreign invested dollars leave the market and the country, and then return as payment for "real" goods and/or services. This while our trade deficit is outrageous. Follow this with the return of paper debt held overseas, cashed out for dollars, and returned to buy anything west of Kansas City thats for sale.
Think of this happening while prices are inflating here as they have been even though the government does not admit so. They lower the CPI with deceptions such as "quality enhancement" adjustments and "core" rates implying that people no longer consume petroleum products or eat.
Or, if you believe stock prices as judged by P/E ratios have become inflated, imagine all that monetary power leaving a sinking market and looking for a new home. I'm not predicting hyperinflation but I can't agree that it's possible only after wartime defeats. Twenty dollars for a loaf of bread? Lets hope not but who knows.
I bought a sizeable stake in physical ranging from $260 to $300 and today it's at $280; that's a break even in my books.
I'm playing dope freak with my retirement money in buying a big stake in Ballard Friday and letting it loose this afternoon. Hell, (since the TSE300 and CNDX are following Nasdaq) I'll play the game, the market gave me a mittful. Now I have a cushion of 16% to 'watch trees grow' and watch my gold shine. I can sit on the 16% and let Nasdaq sweat.
What am I saying?
I've been listening for a year and a half to people moan and groan. If you are not happy with gold, get out, it really is that simple.
We have been ranting and raving for a stock breakdown; it just happened. The 'lid' for Nasdaq is 5,000; we saw it. My
Canuck friends saw the TSE at 10,000 and CNDX at 4,500. Do
you think we'll blow these highs, I can't see it; the numbers just don't support it, IMHO.
We have been ranting and raving for inflation; it's upon us now.
Oil is now firmly at mid-twenties, 10 bucks will never be seen again. Watch oil my friends, oil is the KEY, the GOLDEN KEY.
I will flirt with 'Nasdaq' and techies and I may loose and I don't even care. My HEDGE sits, not making a dime, and I don't care because WHEN the train comes off the track I will have worthless stock and fistfuls of power with a P/E
of infinity to 1.
"One big problem I have with trail Guide is that no other gold analyst in the world -- bull or bear -- accepts his premises. The idea that this lone individual knows hidden secrets that no one else does is implausible to say the least." Oldgold...etc.
What a flight of hyperbole! Oldgold.
To assert that "...no other gold analyst... etc..." Really, now. Do you actually pretend to be up on ALL of them...? In the entire world? Wouldn't want to retract that? Now, while you have the chance, would you?
(Dramatic pause!!!)
No? Then please check out Reginald Howe at: www.goldensextant.com. Sometime when you are taking a break from reading every "gold analyst in the world -- bull or bear".
Also, Lyndon LaRouche.
OK, OK... I know... He has been thoroughly discredited by the powers that be... especially that paragon, George Bush, Esq. Yeah, the same Mr. Ex-CIA Director, Out-of-the-Loop, Iran Contra, Hear-No-Evil... See-No-Evil... You know who I mean... I mean, I believe everything HE ever said, don't you?
Sorry... I was going to point out that LaRouche is the only professionally trained economist to aspire to world leadership. He has been saying for some time that we are on the fast track to disaster. For a while, I was convinced that FOA was in his camp, their comments are so similar.
Also forgot to mention James Cooke, whose point of view could be interchanged with FOA's without most of us noticing the difference.
For many years I have held to the belief that people in western civiliztion make a glaring error when interpreting their present circumstances. We fail to realize the times in which we live. I think it must be the fast pace at which we attempt to live life here. The very young and the very old see things with much more clarity than we who are caught up in the fray. Solomon counseled that there was a time to every purpose under heaven. "A time to get and a time to lose, a time to keep and a time to cast away."- Ecc. 3-6.
Are we living in a time to lose? Has a time come for us to cast away certain things? What then shall we keep?
When we lose the proper perspective, we don't know why we are living. Frustration sets in. What is the meaning of my life, we ask? All seems so meaning-less.
We are the richest people who have ever lived on the earth. Even Solomon, wealthy beyond belief, could not avail himself of modern medicine or automobiles or a trip to the supermarket. We have freedom! We have health! We have riches! Yet, we are so poor.
I choose not to participate in the current market mania. I feel no loss. I will buy GOLD and store it away. Perhaps it will serve me in the course of my life, perhaps it will not. But as for me, I think it is "time to gather stones together."
Most Interesting Indeed!!..........your paragraph below is another chink in the "Black Knights" armour, and a glimpse into the future of Gold & the Fiat System being rethought and reformed......Just imagine the change to the balance sheets of the US Treasury if Gold were revalued on their books as the IMF did.......$35.00 p/oz to $600, or how about $1,000. p/oz....
The US federal debt would look alot more managable.....
-------- But Goldman, and the rest of the "Black Knights" will have run for their holes in the ground, probably well in advace of the hoardes screaming why didn't I buy Gold at $280...... This ramble is just my long held belief in the duplicity of CBs of the world continually helping to fade Gold interest and lending massive amounts while knowing full well it's being returned to them or an ally by virtue of sale by the borrower and thereby helping those involved to buy cheaply before the so called great Reckoning we all know is coming!.....Thanks for making my day w/ your post, Host!..........YGM.
........................................................................
(You Said)
Most interesting is a revelation by World Gold Council CEO Haruko Fukuda that "some countries" are in
discussions with the International Monetary Fund to change the ban on linking currencies to gold. One wonders
which countries those might be with Euroland immediately popping to mind. The euro already boasts a gold
component to its reserves as a further boost to the fledging currency. After all, it is only in England and the United
States that gold fear and loathing inhabits the institutional and bureaucratic mind. In most of the rest world there is
no need for gold to regain its place in the official mindset; it never left. The logical step would be to apply fractional
convertibility. But why would Euroland need IMF approval to move forward? Just do it and drive another nail in that
dying international institution's coffin.
This post was a thing of beauty -- Harley Davidson (4/18/2000; 16:34:30MDT - Msg ID:28956)
It's nice to have you here, Harley. Let me add one thought to your closing comment--
"I choose to see the glass as half full and I will continue to take every advantage of today's ridiculous gold prices and acquire as much physical gold as is financially practical for as long as I can. Oh, what's that you say? What if the price doesn't go up for twenty years? My children inherit all of it (tax free I might add). Along with the teaching of values that matter, like integrity and morality, I can't imagine a better, more consistent, more appropriate inheritance from a common man such as myself to his children."
I once faced this line of questioning from a friend who had then only recently diversified a little into Gold, but still hadn't quite come to clear mental terms with the meaning of situation. Knowing that I am Gold through and through, he asked me, "But what if we die with this Gold and it never zooms in price?"
My response was that I asked him "What exactly do you find so distasteful about dying a rich man?" He immediately understood my implication that anyone who still had Gold in his pocket upon his deathbed most certainly didn't die for lack of nourishment or proper attention.
The last time I saw this friend, he was rather proud that he had recently picked up about two more pounds of Gold. That's right folks. Pounds.
IronHead (4/18/2000; 13:03:52MDT - Msg ID:28937), this was another very nice post. In part, you said--
"Looking out the window as I compose this, I see my lovely wife out planting the spring garden. Strawberries in, asparagus in, seeds being sowed, and an aura of total contentment and harmony with her convictions. ... us gold bugs. We plant for a harvest in the future, through the conviction of our "knowing"; not the market, nor the time line, not even the ultimate price yeild. But simply ourselves. For I buy the message of real worth fraught of real labor and love and even death in the effort to produce these fruits.To believe in Microcarp (sp) at 16 times book, with a PE of a zillion to one, and daily capitalization changes greater than the total gross profit of the company, is simply not me. My conviction, no confusion. So to hold the conviction of why I bought, and will continue to accumulate at these firesale prices, gives me no pain."
That fits right in with the theme here, doesn't it? Looks like you and your wife have whipped up the recipe for a storybook life. By the way, my friend that I mentioned ealier is engaged to be married this year. I hope he fares as well as you have.
Primus, you get to be our study in contrast. Today you said, "As I write, CNBC is showing the DOW up 174.81, and the NASDAQ 201.48. This on what happen yesterday. I've reached a point where I want to chuck this computer, turn off the TV, and just spend my time watching my trees grow. With the trees, at least I know if I water and care for them, they will grow. I do not need to run to this computer and read a dozen different pundits on how trees grow. Being single, owning a small ranch, I spend my days enjoying the land."
Good God, man! You have the perfect thing going on and you don't even allow yourself to realize or fully enjoy it. Why should the market capitalization, up or down, have any bearing on your happiness? Do you realize how many hundreds of millions of people are living on this planet scraping out an existence that would seem very meager compared to yours? I rather doubt that our Nasdaq or Dow fluctuations have much bearing on their happiness or misery. And just as surely, there are certainly a small handful of people that are living a "privileged life" of wealth beyond your wildest dreams who also fail to look to our Nasdaq or Dow as their source or cue for happiness. Just as you admitted that the trees don't need pundits to proclaim how they should perform, neither does Gold. They are both natural, so enjoy them in the same context.
You said, "My greatest joy is to close the day with a cup of coffee in hand walking around my property." My friend, I wish I could be there to join you on one of those walks. That is, if I weren't already busy helping IronHead's fair lady with her gardening.
I think I can identify your problem and offer a solution. You said, "The one thing I do know, I have given up the ability to accomplish objectives due to the holding I have placed in physical Gold and Silver." My friend, that tells me that you have too much! In this world, to do something you generally have to leave the house with a wallet stuffed with cash (or a credit card). Other than your enjoyment while on your ranch, if you have denied yourself many of life's offerings because you don't have any walking around money, then for God's sake sell some of your metal (the silver, of course) because you bought more than you should have at this moment. How many people would actually find themselves saying, "The one thing I do know, I have given up the ability to accomplish objectives due to the holding I have placed in my savings account."? Precisely nobody. They would look at their savings as the ENABLER for their pursuit of dreams. And you should see things that way also.
USA Gold... If what she stated is in print, it should be posted on as many Stock and Financial/PMs discussion boards as possible....I feel quite elated to hear the Gold Standard not only mentioned by her, but by Greenspan last week also... YGM
http://www.dailyreckoning.comFar out on the planetary alignment theory. What it could do is pull all the traders on the CBOE over to one side of the pit floor, then the guys with kryptonite in their pockets run in and take their place?
No, in all actuality we don't know about the "full moon" theory. It has some effect but which way. Do the longs get spooked and go short? Visa-versa?
Here is my planetery theory. In Psalms it is written "One thousand years is to the LORD as one day". We have 2,000 years from Adam to Abraham, then 2,000 years from Abraham to Christ, then 2,000 to now.........based on our calendar that may be a little bit off as to Jewish years. That is 6,000 years as being 6 GOD-days by Psalms. On the 7th day He rested. That would represent the 1,000 year reign of Christ on earth during the "Sabbath of the earth". It was told in Jeremiah that the Jews were sent into exhile to Babylon for 70 years because that was the number of sabbaths they had ignored to keep while suffering a backslid idolatrious condition from Solomon's sins. So the land was to catch up with its prescribed "rest" before the Jews could return. According to this theory we are right close to the apocalpse. The pope's visit to Israel sparks every prophecy buff to watch it close. When this stuff goes down it is going to fall into place very fast. Satan knows his time is short and he will speed the consolidation up putting the UPC symbol tattoo on the faces of the deceived masses. The last scan could be the buyer or the seller. Owning gold could buy some precious time. The refugees who had no gold may still be back in Vietnam. I don't need Earnest Angelly to spoof me on a phony healing but I'm all for being fed by Angels in the wilderness. "Way out" you say. Not as way out as the history of the Jews. Look at where the wandered in the barrenest areas of the Sinai Peninsula. Where was the water for them all? Miracle times II when Revelations goes down. First 25% of the earth gets effected, reality-light. Then 33%, ups the anti. Then after truth is persecuted away and only liars remain it's a Nazi camp for suburbia global. The antichrist has little power over areas without electricity.
So what about gold? First of all know that the Spirit of Truth beats the machine guns and the cameras and the agents and the backstabbing family members and close relatives who will sell you out in times of famine quicker than a McDonalds drivethrough. My brothers used to ask me how much gold I owned....Pray a prayer of protection over your gold. Surrender it to the Spirit of Truth and to God's Glory. Then the Lord might want you to be steward of it. We won't be messing with any physical power that we can beat. Children filled with truth will live through the nuclear war, the body being just a shell for the soul. "I own physical"............you don't own the hair on your head. Give your gold to God if you want to see it after witchcraft becomes the national religion. A drive for unity without truth VS the believer's drive for truth disregarding man centered unity. Gold reminds me of God but to trust in it is vain.
I saw your (19:37 - Msg ID:28979) ["We need Ari to hand out some relax pills."] Looks like I had one in the works at the time--but I'd say in the process of writing your post you offered a fine pill right then and there.
The satisfaction of drawing together a school of independent THINKERS is also sublime beyond most human accomplishments.
-------------------------
Hello Mr. Gresham,
Thanks for your consideration and the same to everyone else who has voiced the same. It's taken a while for me to read all the posts. I know there are more than a few that hold OldGold's position. But, their position and strategy speaks for itself. It will succeed or fail them in the long run. I think if Another were here today he would say "time will prove all things" and leave with that simple, all
consuming thought.
Yet, I can't help but think that your comment about "drawing together thinkers" is indeed part of the plan we see in process here today. While GATA leads with a nuts and bolts attract, Another draws the human spirit and imparts his question in the hearts of real wealth patriots.
I have read that education through experience builds the mind. Once shown what to look for, events become the real experience that creates lasting knowledge and demands the search for more. More often than not wars are won by an army lead from the last in line. Yet only armed with a truth they have found on their own.
aunuggets (4/18/2000; 18:29:06MDT - Msg ID:28966)
Suppose for a moment you were a Central Bank......
....Would you "sell" your hard assets (gold) for another commodity that you could easily create out of thin air (U.S. Dollars) ? This has probably been mentioned by others, but where is all of this gold being "sold" by the Central Banks ? Is it entering the (private) markets as physical, or is it simply more of the illusion, actually consisting of nothing more than bookkeeping entries from one CB to another ? The "numbers" don't seem to add up for some strange reason.
Hello aunuggets,
That's a real good trail to follow! (smile) I'm with you on that one!
I fear too many Americans dont value our heritage the way you do.
For example, in California the legislature has stripped the
Citizens of their inalienable,constitutional right to own
semi-automatic rifles. Where is the hue and crie? Where are the courts? Where is the NRA?
Vernon Howard, a 20th Century mystic, said " The Devil is a
Chipper". And he was right.That is how he works: chip, chip,chip away at your rights.
How many National Guardsmen would refuse to obey an order to take away guns from citizens in the event of race riots or civil war? Not too many I dont think.And you might be surprised what a lot of police think about gun rights.Hey, what if the court rules the right to keep and bear arms only applies to the National Guard?
I expect the attempts to take away our rights to continue and progress. As Thomas Jefferson said (paraphrase) it is the nature of man to put up with abuses while they are tolerable.
At any rate, Americans are no longer a free people. I dont
think there is any doubt about that.
I still finds the idea that the European CBs will ever do anything significant to help gold and hurt the dollar fanciful to say the least. Not only do they continue to trash gold in a major way (albeit now within certain limits) but they continue to accumulate US dollars at a rapid pace. The dollar index is making new highs even as I write despiter record trade deficits.
The comment by one poster today that people should be here only to find out how the world works and not to get rich quick again shows a kind of arrogance and disdain for the financial interests of gold investors that has along been a problem at this site.
I for one am not here to get rich quick but to help ascertain when the gold bear might turn into a gold bull. If this site cannot help people in this regard it will be on its way out.
In reading here tonight, it got me thinking about two items I own that were passed down to me from my great grandad. His GOLD pocket watch and $ 50 million in old German currency, and in one bill! There is a lesson from a man I never met.
Down Twice as Much as Yesterday.====================================================
...
Tuesday's PATSY Report
4-18-2000
To: ALL
The nightly PATSY Index shows the relative
amount that GoldBugs have been conipulated.
XAU=55.72 + POG=280.00 + POS=5.09
-equals-
340.81
Down -2.16 from Monday.
Comment: We've been had again by the BadGuys.
But wait... Your PM ounces remain intact.!. Their
weight and intrinsic value has not changed. Can
anyone wish for anything better than that.?. And
don't forget... we can now buy more ounces of them
with even less of our hard earned fiat currency.
Prediction: More (or less) of the same, tomorrow.
ThaiGold...
Got Some.?. ... Get Some.!.
====================================================
Is there something in the American mind that resists understanding, or even thinking about, the concept of "wealth"?
Everything must be "democratic" -- a spectrum ranging from equal opportunity to equal outcomes. So we don't want to think of wealth, which implies inequality, and worse, static inequality!
A century's brush with socialist idealism has kept many fine people from wisely considering their relationship to wealth, and sharing the resulting thoughts with society, though it has not kept many people of the less-benevolent type from acquiring it. They just learned to speak differently about what they were doing.
A young nation, compared to the others. There's no getting around that. We need to always be on the go, developing the next thing, gambling all on a stock with a "good story".
A lot of what we each hold as our sacred opinion varies with our age and station in life. When I was young, in my twenties, I thought of the older generation as rich and corrupt. I had no concept -- could have had none -- of the experiences they had been through leading them to value wealth. The sense of a door about to close just ahead of them.
When my father was my present age (50) his third and last child left home for college, so the bills were not quite over yet, but he was able to begin planning the final stretch of wealth accumulation leading up to a retirement at 62. His contentment now with having "enough" sets a good example for me.
Unfortunately for me, financially, I have a small child and a modest paying self-employment which are unlikely to permit me anywhere near the accumulation my father succeeded in. And furthermore I am determined to ENJOY this final gift of fatherhood and not blow it in wild-assed money-pursuing schemes. That's three STRIKES in the retirement riches game! So I am going to slide on into 65 or so with a happy child, no money to speak of, and the few gold coins I've managed to buy under y'all's inspiring company!
One good thing about TrailGuide's alerting us to paper investment vs. physical is that I've nearly stopped counting my "wealth" in dollar terms, by which I'll probably never catch up to most in my generation. I've stopped comparing myself to others, to the dot-commers and happy faces on cover of "Money" magazine (which subscription I let lapse). Envy is there, I confess, but at least the numbers don't flicker through my head at night.
I have a happy child, and I am a happy father. I have some gold. I have enough.
>>>>arrogance and disdain for the financial interests of gold investors that has along been a problem at this site.<<<<
To whom??
>>>>>I for one am not here to get rich quick but to help ascertain when the gold bear might turn into a gold bull. If this site cannot help people in this regard it will be on its way out.<<<<<
Attn: Soloman Weaver / #28989=====================================================
...
4-18-2000
To: Soloman Weaver Re: your #28989
You're right.!. The PATSY index would be more
logical, if weighted for the disparities.
However, since there's nothing Logical about
the PM's (anymore) and Disparity is rampant,
I felt just the base figures would be adequate.
Besides, I hate math.
Your suggestion is well-taken, and if I have time,
I'll try to incorporate some weighting into it
next month. Why NEXT month.?. Because I've already
calculated and filed all the calculations for
this month, in advance. I just wait for each day
session to close, so I can post them to you all.
Oldgold, thanks for stirring our little pot of soup. Some stuff has gottent stuck at the bottom.
Rather that try to put Trail Guide's point across for him, which he does very well himself, I will just point out this:
1. There has been a gold standard in effect through the 80s.
The US overdrew its gold and the system collapsed.
2. There has been a dual physical gold and paper gold standard since 1989 or so. The US and UK overdrew this by 1997.
3. The Asian collapse, though it would have happened eventually anyway, was a planned event that saved our sorry @$$es for three years.
4. The bulk of the dollar support mechanism (remember that we did not have a current account surplus in three decades) was a series of debt traps for various emerging nations that were indebted by tricks and by force. These debtors needed dollars to pay off interest on dollar loans so that they could buy life's basics on the global markets.
5. The idea of a debt derived money offering stability in economic function and in prices is an absurdity on the scale of defying gravity, absolving the world from Newton's law. Without an anchor in a commodity money, all debt money spirals out of control and into worthlessness. No conceivable system can make it otherwise. Gold is to finance and money as the speed of light is to Einstein's law of relativity. Gold answers the question "relative to what?".
In short: for a monetary system to work, someone, somewhere, must be able to exchange the currency for gold AT A FIXED RATE. We call this parity.
6. The global dollar debt system is collapsing. Soon, only the US and a few "friends" will be left owing dollars and owning the "bag" - our debt.
7. The system could not work if it was well known even among the top bankers, because their attempts to get into gold for defense against this would have killed the system. Even now, when it is apparent, bankers refuse to believe that their product is as toxic as RJR's and Columbia's main export combined (and they work in remarkably simillar ways).
Finally, say thanks for the low gold and silver prices you are getting and pray that it can continue. Next thanksgiving tell your familly to give thanks to the Germans, Japanese, Koreans, Chinese, Indians, Italians and others who feed and clothe us half the time (actually 56% in 1998, 60% in 1999).
---------------------------------------
Some details and discussion follow:
We have fought a war and have lost it. The war that was fought was for financial hegemony through the issue of the reserve currency for the world. In essence making the US serve the role of banker to the world. The war was lost in 1968 and defeat conceded in 1971 and again in 1973. With much support from a world scared of a complete freeze-up of commerce, the dollar was resuscitated just in the nick of time and a new gold convertibility standard was put together by the same bankers that pushed for and got the Fed and then Bretton Woods. JP Morgan said "gold is the only money". He said so well into the Fed's life when gold was no longer circulating in great volumes.
Fiat debt money is incapable of maintaining value without a fix to a real item - notably the precious metals, and the most prominent of them, gold. The dollar is two different things at the same time. Within the US is only a product of debt, the IOUs of all us credit card using and mortgage and car loan paying people that the bank sells to the producers of the houses, goods, autos we buy with "credit". Outside the US, the dollar is much the same, until it meets the BIS for transnational settlements of imbalances. There, the central banks trade gold for dollars at an unknown exchange rate much greater than that in the markets. (This is a premium that is payed for the right to buy gold rather than the gold itself - this way it is kept off the books). The private markets provide the non-US private bankers an opportunity to hedge their dollar assets and those of their clients. The US banks and their UK allies produce the paper gold needed for settlements of dollars into gold debt.
The fact that someone - somewhere - can settle over $100 billion dollars in unbalance "imbalance of payments" every year with gold, is what makes the dollar's value relatively stable.
The US and UK bankers had completely overstepped their bounds in the process and issued way more paper gold than there could ever be redeemed (the BIS and OCC statistics just deal with derivative contracts, these are just mirrors of a much larger gold banking system which underlies trade and at which gold settles the dollar through the SDR). So long as the gold credits were believed to be redeemable, the system was credible.
When it lost credibility, in 1996 - 1997, the imperative became the classic wildcat bank strategy of moving the gold in the back door when the inspector comes to look at your reserves, and transfering it to the next bank just as the inspector is on his way there. The whole dynamic is now the satisfaction of gold demand by whatever means necessary so as to maintain credibility of the paper and thus prevent a "bank run". The Washington Agreement was the statement by the EU that they will not put in jeopardy any more of their gold, that their part in the dollar support system is over. Since that date, the US has been exporting some 800 tons of gold (annual rate) officially, and an unknown ammount "below custom's radar".
In the meantime, the bankers in the EU and the UK have been redeeming their gold liabilities to their clients with American gold liabilities. When actual gold ran out and gold yet to be mined (or found or explored for) was used for settlement, some time in the late 80s, this part of the dollar support system was born. The part US banks played was (at first) small, US market share in gold banking was some 20% in 1995. By 1997, it passed 35%, by mid 99- over 42%, now it probably passed the 50% mark according to OCC numbers (BIS numbers for the end of 99 will only come out in June).
This process reflects the change of responsibility for managing the dollar from the losers of WWII to the "winner". The Fed is responsible for the viability of the liabilities of US banks. These liabilities are what we call dollars if banks can't supply dollars they owe, the Fed supplies them through the treasury and directly. The gold liabilities of US banks are quickly growing so that they will soon hold all of the dollar side of the global dollar-gold settlement system. When the transfer of gold liability from the UK to the US is complete, there will no longer be any reason for Europe and the Oil nations, nor China to assist in controling the gold ecxhange rate. At that point, the gold obligations will be terminated and gold contracts and accounts drawn on US banks will be settled in dollars only.
The time for that is not here yet. I would venture a guess at the time frame of the end of this year. At current rates, the transfer should be finished by then.
The terms for the end of the game were set, in part, in the early 80s. Since then, there had been a tremendous effort by the US government to stop use of American resources by American and foreign consumers. Major finds of gas, and particularly, oil were capped and not allowed to go into production. Forest lands were set aside from loggers. Gold mines were induced not to explore nor produce gold within the US. Why? So that when the end does come, the US will have cash traded commodities to sell - so that when the US can't buy on dollar credit anymore, it will have something to trade while the country is reindustrialized.
The US tried to play the technology card by assisting US tech companies in gaining investments, that was done by making them appear more attractive to investors through SEC and IRS accounting rules regarding ESOPs and merger accounting that lower the cash costs of top talent and make losses seem like earnings. But the "social adjustment" oriented school system produces mostly good salespeople and hamburger flippers. India has more programmers than Silicon Valley, and Taiwan and Singapore produce more chips. The best computer and software design is done in Ireland and the Norse countries, and wireless technology is mostly a Finnish, British and German industry. The only way to eliminate the disadvatage in education is to import as many tech pros as we can before they stop wanting to come here. If 10 million 30-35 year old techies can be imported over the next 5-10 years, the US may have a chance to survive as the major economy.
The bank debt reports published by the BIS and the IMF tell the story in all of its gorey statistical details. The dollar debt outside the US is collapsing as it is turned from emerging market and transnational corporate debt into American debt. The US imports produce a flood of dollars that pay off the liabilities of Emerging nation's corporations, governments and banks. It is the need by these to repay dollar loans that has produced demand for dollars abroad. Now that they no longer borrow in quantity and have been reducing their debt, these countries are slowly reducing the international value of the dollar and adding themselves to the long list of dollar creditors. The only dollar debtors left are the UK, some HIPCs, and the greatest debtor ever, the US.
The story is simple. The debt trap set for the emerging markets by 3% dollar interest rates in the early nineties, was sprung in 1997 by a joint effort of the Fed, the IMF and the BIS. The IMF demanded self destructive policies from the countries it was supposed to help, the BIS raised their bank's reserve requirements (actually it was their net asset ratios - a.k.a. ccapital adequacy - but few understand what that is and reserves are a close enough descriptor), and the Fed raised interest rates by all of 1/4% and the whole Asian economic system collapsed.
This generated the requisite dollar demand, stopped Asian gold demand, produced an Asian gold supply, and allowed EU and US banks to buy out many Asian corporation's assets that they were barred from owning before. Hyena and Vulture LP had their day. We were spared disaster for another three years.
Re: Primus (4/18/2000; 11:20:12MDT - Msg ID:28933)
Invitation from ThaiRanch================================================
...
4-18-2000
To: Primus / RE: Your #28933
Many of your remarks struck a chord with me,
almost as if I could have written them myself,
about myself.!.
We seem to have alot in common, from living alone
upon a ranch, to loosing our shirt in gold stuff,
and being unable to do anything but wait it out,
else suffer enormous losses.
Most of my dreams, too, have been postponed, cancelled,
or sidetracked due to unwittingly "investing" in PM's
at the wrong time, and apparently for the wrong reasons,
and of the wrong category.
Caveat Emptor. We Learn From Our Mistakes. Sometimes.
But I am ever-the-optimist. I mean, ... Things cannot
possibly get worse than what I've already endured. I do
see light at the end of the tunnel. Maybe it's just more
of my wishful thinking. But what else can I do.?.
If you have time, and care to become PenPals, please
feel free to e-mail me at: ThaiRanch@OperaMail.Com
Reduce expenses, save in gold and in high yield bond and dividend funds. Do not lock up your funds in long term CDs. Stay liquid.
If you can afford to do so, create a second home and residency rights outside the US where you can go when Boomers start retiring and getting the diseases of old age. They will vote for themselves all of your income and all of your assets if they can come close to getting them. Make it difficult.
RePost, at the Request of: Myself.!. =================================================
...
4-19-2000
To: All
Because the Forum is so quiet tonight, and I must
stay awake all night to rebuild a crashed harddisk.
...
ThaiGold (7/13/99; 21:38:46MDT - Msg ID:8828)
[First Post] GOLD: Die for it.?.
========================================================
It's often said that in the past, historically, "men
died for Gold". And they did. Often large quantities
of it. We all know that. An ancient era of the past.
But are we aware of men who even today, as I write,
as you read, at this instant, are about to Die for
Gold, indeed, as little as a single ounce of Gold.?.
Thailand is a neat place. Exotic..Erotic..Exciting.
Someday I wanna live there. When my GoldStocks go up.
I love the Thai people. Beautiful/Friendly/Sincere.
Especially their unique males.. The KickBoxers.
"Muai Thai" is their national sport: Thai KickBoxing.
It can be a deadly sport. Or very injurious. Risky.
Virtually every night, matches are held in the arena
at Bangkok. Even televised. Often sold as VCR tapes.
Western culture thinks of Boxers as Big/Burly/Black,
overBearing/Blustery/Bruised, but seldom Benevolent.
Thai KickBoxers seem quite the opposite, to me:
Such handsome delicate features; shy; quiet; polite;
smiling; humble; compassionate; diminuative frames:
all these traits belie their legendary lethality.
Thai boys practice it from the earliest age. Hone
their bodies. The bare feet, shins, knees, of the
adult have the speed/mass/energy of a solid oak
baseball bat. At 50 MPH. Watchout. Landed kicks can
splinter bones/necks/ribs/skulls. In an instant.
Typically, a match begins as the two young boxers
(late teens/early 20's)--(if they live that long)
enter the ring. Somber. But never arrogant. The
band begins playing the rythmic background pace:
That music, unique in all the world, soon causes
the hairs to stand upon the back of your neck, as
you sense the impending magnitude/risk of a battle
soon to occur before your very eyes.
Some spectators will feel sadness, guilt, even
apprehension in their gut, for having come to see.
Similar to the first-time-seen carnage of an actual
BullFight in Spain or Mexico. Only this seems alot
different somehow: These are people. Nice people.
Boxers go through a pre-bell ritual: A gracefull
and reverent prayer/dance where they bow and pray
to the four wind directions. "Wais". Each knows in
his heart, that, having just stepped into the ring,
he may not leave it, whole, nor indeed, even alive.
The rounds begin: They will pummel each other as
best they can between each bell. Until one can
fight-no-more. The victor is not ecstatic. He bows
his head, and merely allows the referee to raise
his arm to the watching crowd. Then he quickly
climbs out of the ring, seeking to assist in aid
and comfort to his opponent. Holding, touching,
sincerely caring as they exit together, from the
arena floor to the lockers/emergency medical room.
Often on a stretcher. He will walk/touch beside it
deeply concerned for the recovery of his vanquished
companion. There will be no TV interview. Nothing
to brag about nor ballyhoo to the fans and media.
Just a quiet, somber, elegant exit from the arena.
Within minutes the next pair of handsome young Thai
gladiators enter the ring... to begin their Wais,
ritual prayer-dance. Thus, into the arena's night.
Next day -payday- he will quickly convert his fiat
paper winnings (Baht currency) into Gold: ThaiGold.
A pure 24-karet, no-nonsense, simple rounded-link
gold chain. It will be about 18-inches in length,
and weigh two or three ounces. Loser: maybe a 1 oz.
Worn discretely around his neck, for a few mere
hours or days, as he quietly bicycles or walks or
hitchhikes to the remote village wherein lives his
parents, brothers, sisters and whence he only
recently had lived, himself. Upon arrival, he will
be greeted tearfully. He gives his ThaiGold to them:
That they may have sustanence to purchase their
daily/weekly/monthly needs for the coming year of
impoverished family survival. Link-by-link, they
will "spend" this ThaiGold in their local village
market, for vegetables, fish, fruit, rice and rent.
After a few days of healing/rest/recovery, he will
again tearfully depart. They will have a going away
party for him: Tie pristine strands of White Yarn
around his wrists: A farewell and Good Luck symbol
of highest significance. In SouthEast Asia. His
destination, of course, is Bangkok. And the arena.
To once again Muai Thai: KickBox...
...Maybe even die-for... ThaiGold.
I myself, have a small ThaiGold neck-chain. Given to
me years ago. ... a long story. I treasure it. More
than all the fiat money in the world. Even more than
GoldEagles, Krugarands, MapleLeafs, Philharmonics.
There is something about ThaiGold. Ask any Asian. They
know it when they see it. Not sparkly. Not cheap 18-K
jewelry counter trinket gold. No. They are insulted by
gifts of anything other than real ThaiGold. No assay is
necessary. They just look at it. The design. The simple
craftsmanship. They sense the density of it. They know
it has value. Utmost value. Spendable value. Survivable
value. Intrinsic value. Fought-for. Often died-for.
ThaiGold..
Got some.?. ... Get some.!.
============================================================
Gold Ownership--its all about achieving a proper understanding of Wealth Hierarchy
oldgold, I've got to hand it to you--you sure managed to trigger a day's worth of posts on the forum that strike this reader as among its best ever. Thanks for sharing your somewhat abrasive personal assessments of the merits of Gold investments as a challenge to many here to come to terms with their own thoughts on the subject. It looks to me like many liked what they found when they looked inward...and not surprisingly, they were to a man ALL physical Gold owners (in addition to whatever other wide and varied facets of social and investment endeavors they may have.)
From your latest post on European CBs and Gold, you said:
"I still finds the idea that the European CBs will ever do anything significant to help gold and hurt the dollar fanciful to say the least. Not only do they continue to trash gold in a major way (albeit now within certain limits) but they continue to accumulate US dollars at a rapid pace."
Isn't more accurate that it is your assessment that might be what is fanciful? If not, what is your supporting evidence to the above claims? If I may, please let me offer two bits of readily obtainable information as a counter to your claims.
Standing against your first claim that European Central Banks won't "ever do anything significant to help gold" and that "they continue to trash gold in a major way," I offer this very public and very significant historical act--the Washington Agreement, now barely half a year old:
Mr. Wim Duisenberg, President of the European Central Bank, announced the joint Statement on Gold: "In the interest of clarifying their intentions with respect to their gold holdings, the [fifteen European] institutions make the following statement:
1. Gold will remain an important element of global monetary reserves." ...etc...
Standing against your second claim that European Central Banks won't ever do anything significant to "hurt the dollar" and that "they continue to accumulate US dollars at a rapid pace," I offer a simple acknowledgement of the successful launch of the euro currency to counter the first half. Against the second half of this claim I offer these two news briefs on the latest release of the ECB's weekly balance sheet:
--ECB total gold assets unchanged at 115.677 bln euros Apr 14
["My, Granny, what large Gold you have," said little Red Riding Hood.]
--ECB: Net FX assets dn 1 bln euros to 264 bln on Apr 14
["My Granny, what a large drop in foreign exchange reserves you have. Where is the accumulation of dollars at a rapid pace?" asked little Red Riding Hood.]
But, oldgold, you reached your thought-stimulating best when you offered these remarks at the end of the day:
"The comment by one poster today that people should be here only to find out how the world works and not to get rich quick again shows a kind of arrogance and disdain for the financial interests of gold investors that has long been a problem at this site. I for one am not here to get rich quick but to help ascertain when the gold bear might turn into a gold bull. If this site cannot help people in this regard it will be on its way out."
First, I'm sure you can appreciate why those of us with abosolute, pinpoint, foreknowledge could never possibly be permitted to share such information about the bear/bull transformation date and time of day on a public forum. Here's a hint though--you already missed the turn. (It was cleverly hiding behind BoE sales.)
Regarding the issue of either figuring out how the world works or getting rich, I would suggest that the latter naturally follows the former. It can't be any other way short of heavy reliance on blind luck.
We are Gold owners, accumulators, and advocates because we have in fact discovered the ways of the world. It's all about understanding the Wealth Hierarchy.
Simply put, the world works like this: We all have needs to sustain our life, and we therefore all must endeavor from cradle to grave in the satisfaction of life's requirements. Wealth, you see, is anything that can be utilized in meeting our needs to sustain our lives.
Wisdom and experience show that some wealth assets are more reliable and universal. Some are so reliable, and so universal we actually give very little thought to counting them amoung our assets. Take oxygen. Most of us as we walk down the street give this nary a thought. We are oxygen rich! If you don't believe me, just think of what you'd say upon hearing of a scuba diver who ran out of air while exploring some underwater cave. "Poor bastard." At least, that's what I'd surely say.
So, unless we anticipate scuba diving, very few of us take any effort to mindfully or aggressively gather for later use the real wealth of oxygen. And to any primative, or a resurrected ancient, who had no concept of scuba diving, we would surely look like the perfect fool bottling air in preparation for the event.
To keep this short, let me come to the point. We have basic material needs of food, clothing, and shelter. Access to energy could be also be included in the list. To have more than you need for satisfying the immediate demands for survival is to be wealthy. To come up short in the ability to satisfy any one vital need quickly reveals you to be another "poor bastard" in the eyes of the impartial gravediggers.
Fotunately, from the earliest times of our ancestors we have discovered that we don't all need to be meticulous wealth planners like the modern scuba diver, Mt. Everest climbers, or astronauts taking a ride to the moon. We can generally blunder our way through day to day and year to year in the comfortable fact of life that through the open market--through the ability to trade with others--we can generally obtain what we materially need in one facet by exchange for some of our wealth in another facet. Food for clothing seems like a pretty reasonable medieval exchange, doesn't it?
We all know the inefficiencies of barter, don't we. As civilization and trade evolved from the dawn of man to the 20th century, Gold revealed itself to be the single most reliable, universal agent that could be traded in various quantities for anything anywhere on Earth. Maybe most remarkable in this is that Gold is not itself something that is needed or consumed in satisfaction of our basic material needs for survival. But due to it being perfectly and uniquely suited for this universal role in trade for any other person's available wealth as necessary to meet your own specific needs, Gold has become such a near proxy for the real wealth we require for life that many of us have permitted ourselves the casual inclusion of Gold into our otherwise strict definition of wealth.
Those in the industry have come to call this universal wealth asset (Gold) by the name "money," but that unnecessarily confuses the issue. In their efforts to facilitate various objectives in modern life, those in the financial industry endeavored to master the alchemist's craft--to methodically create "money" from such substances as worthless base metals or from paper. Even the village idiot can clearly see that "the bankers and others" didn't succeed in creating Gold. But the village idiots were never so sure that these nickel coins and paper notes weren't in fact successfully turned into this other "thing" that the experts called "money." As for me, I'm comfortable calling these creations by the name "currency," and further, I recognize that they can and do serve a useful purpose in modern society. With this distinction I am not so easily baffled as the village idiots into thinking that these currencies created in the image of "money" can actually attain the superior wealth function of the asset they sought to imitate--that being Gold. And you shouldn't be fooled either.
Every currency made in imitation of Gold goes hand in hand with the financial architecture that supports it right into the trashbin of failed efforts, and are logged into the collective wisdom of those who vow not to be fooled again. Based on the conception, care, and feeding of the various currencis and their supporting architectures, the lifespan, or timeline of predictable rise and fall milestones may vary in length from one currency to another. They may serve a purpose while they last, but they all suffer the same eventual demise at the hands of inflation. Remember, these currencies are man's artificial attempt, time and time again, to imitate Gold for use in modern commerce. They are built for speed--built to be borrowed specifically, and spent rapidly! They are not suitable for saving. For that you must turn to the master--the near-wealth proxy upon which all currencies must bow down in inferior imitation.
So you see, learning how the world works is all about each man coming to the understanding about the real wealth we all require to best ensure our survival. Knowing that Gold is the master proxy for our life's day to day and year to year shifting requirements for food, clothing, shelter, and energy, it simply makes more sense to gather in Gold for later use than to gather in clothes that we may outgrow, food that may spoil, houses that are more than our needs, aor energy that we can't store. You see, time bears witness to this undeniable fact: Gold can be called wealth because it is an enduring wealth proxy in exchange for our life's needs. Currency, on the other hand, serves a specific modern economic purpose--to be borrowed and inflated in placation of man's immediate desires. It is not wealth, it fails as a proxy for the Gold it tries to immitate. Do not confuse the two.
Understanding how the world works is easy as soon as you understand the Wealth Hierarchy. Like this:Earn money (currency), buy what you need, save Gold, enjoy what life has to offer.
My last waking effort of the evening is to make the motion that this work of yours be captured in the Hall of Fame for subsequent referral to others. I go to sleep in full confidence that it will be duly seconded and qualified upon the hour of my eventual waking.
Thanks for your personal effort to make the world a better place. I mean that in all sincerity.
Have you ever looked past the posts to the characters?
-----------------------------------
"First, I'm sure you can appreciate why those of us with abosolute, pinpoint, foreknowledge could never possibly be permitted to share such information about the bear/bull transformation date and time of day on a public forum. Here's a hint though--you already missed the turn. (It was cleverly hiding behind BoE sales.)"
---------------------------------------------
About half a year ago FOA was accused to be the director of the WGC. (I won't attempt to spell HER name) The accusation was quickly dismissed. Who is who on this forum? What a perfect way to lay out a statement than via a anonymous, electronic, publicly accessed medium. The 'inside' information can be laid out quite transparently, both from a negative and positive agenda.
A further point on collectivists and statists is that at heart they are haters of Man. They hate and revile mankind and hate themselves. This philosophical view is why they promuligate a paper fiat wealth medium. It is a mirror and tool they can hold up to mankind and themselves to speak debasement and immorality.
Mankind must have a standard that preserves the fruits of his noble works. Work is Noble. The clean,purified gold'solidifies in his hands the inherent "good", of his stivings. The good wealth.
This is what this whole battle is about. The flawed,hateful philosophy of something for nothing, or a standard of wealth that honors and esteems honest work. Honors Man. Esteems.
Source: Bridge NewsGOLD MEET: Consultant: Gold at $289 in 2000 in 'probability scenario'
Palm Springs, Calif.--Apr 18--The gold price will average $289 per ounce this year and $309 in 2001 in a "probability weighted price scenario," said Martin Murenbeeld, gold market consultant at M.Murenbeeld & Associates Inc. Speaking at the Gold and Silver Institute annual conference here, he said that a 'Gold Bug' scenario puts gold at $315 in 2000 and $360 in 2001, while the low price scenario puts it at an average of $260 in 2000 and $252 in 2001. (Story .20899)
Black Blade: Definitely like the Goldbug scenario better ;-)
GOLD MEET:Mines should consider mega merger: World Gold editor
Palm Springs, Calif.--Apr 18--In order to get themselves onto investors' radar screens, gold mining companies should consider a mega merger, such as an AngloGold-Barrick-Newmont-Placer linkup, said gold commentator Paul Burton, editor of World Gold. This would create a company with a critical mass and possibly entice investors away from dot-com companies, he said, speaking at the Gold and Silver Institute annual meeting here. (Story .19174)
Black Blade: I don't know, there's some bad blood between some of these guys. It would be interesting though. Could ignite additional interest in Au investment.
Stillwater has 22,000 oz '01 palladium hedged at avg $672/oz
New York--Apr 18--Stillwater Mining said Monday that as of Mar 31 it had forward contract positions of 22,000 hedged at an average price of $672 per ounce for 2001 and another 2,000 ounces hedged at the same levels for 2002. The company had forward contract positions on 14,000 ounces of platinum for delivery in 2000 at an average price per ounce of $404 per ounce. (Story .18059)
Black Blade: There were questions posted concerning SWC hedge positions. I believe that these are floor price hedges and are open to the upside potential.
NYMEX lists additional gold options strike price
New York--Apr 18--The New York Mercantile Exchange said it listed an additional gold options strike price of $440 Monday on the Dec 2001 contract. The recommendation to list this strike price came from the Exchange's floor committee, as it would not have been listed under the regular parameters of the Exchange's gold options contract. (Story .23930)
Black Blade: Now why would they do that? Hmmmmm�����. Possibly bullish, or maybe they detect a demand?
RE: Canuck (4/19/2000; 4:59:30MDT - Msg ID:29011)======================================================
...
4-19-2000
To: Canuck
...In your post #29011, you said:
"Have you ever looked past the posts to the characters?"
... And then you said:
"So I ask, who is Alan Greenspan?"
...Okay. I didn't think you'd catch-on to me so quickly.
I must admit though, it was exhuberant fun while it lasted.
... Now that you have blown my cover, I shall henceforth
refrain from giving you such straight answers and clearcut
unequivicably obvious inside information.
... And bye the way: I did *NOT* have sex with that woman,
Monica Shovinski.!.
TPTB have a vested interest in keeping TPOG low, to protect those comrades and themselves in the short position, and to "shore up" the US dollar in terms of its numerical value relative to gold, and hence bolster world wide perception of its intrinsic value. (Hee-hee, thats funny)
What could make them lose control? We are not talking about some little renegade group working out of a cave- No, this is the very financial infrastructure of the Western world.
Do any of our more enlightened minds on this Forum have any idea what could upset this game?
I had heard a massive derivative blow-up could do it.
Or maybe it will self-destruct due to its own poor design, because theft is not sustainable.
Anyone?
P.S. Please excuse me if this has been explained before. My time is extremely limited, so I dont get to take a break on leisurely Saturdays and catch up on the posts, as I used to do.
The link shows all the major US StockMarkets
are headed downwards.
Except AMEX, which is heavily laden with
the GoldShares. It's headed up.
So is the GoldChart, and the OilChart.
Take a look...
http://www.pitnews.com/daily_charts.htm
And golly-gee-whiz... I just checked the XAU.
It's up too.
Looks like another BadDay for us GoldBugs, for sure.
Drat.!.
JOHANNESBURG, South Africa, April 19 /PRNewswire/ --
Harmony, the only producer that refines and sells its own branded gold, today announced that it would be making its unique 10-tola bar available for sale on the internet at www.harmony.co.za.
Chief executive Bernard Swanepoel said the company has been successful in distributing its branded products to the Indian market. The initial product will be its 10-tola bar, which will satisfy demand from the company's
European and North American shareholders and investment markets. The range will be expanded to include other products in the near future.
``Unfortunately, neither our South African shareholders, nor the investing public, will be able to participate in this exciting venture, as South African law still classifies our 10-tola bar as unwrought precious metal. We do not agree
with this and aim to pursue this matter with the South African Reserve Bank. It is surely time that South Africans are allowed to hold physical gold for investment purposes'', Swanepoel said.
Second the motionIf one is still needed, I second the motion for ORO's msg.#29003 nomination into the Hall of Fame.
I would also suggest that a separate page be designated to/for ALL of ORO's work. His work, like FOA's, is something that I am always looking for and often need to refer back to.
TC, I hope such an idea is not out of bounds or too much work. I know you are as busy as one-legged-man in an ass kicking contest, but it would sure be nice.
If I am not mistaken I believe nominations require several seconds. As such I too will second your nomination of ORO's msg #29003 for inclusion into the hall of fame.
Oro
So much of what you write rings true to things I have read in recent years. I greatly appreciate the time you take to share your research with us.
Today's Report: An Ode to Government Finance, or Why the Balanced Budget Can Never Quite Get in Balance
http://www.usagold.com/Order_Form.html4/19/00 Indications
�Current
�Change
Gold June Comex
282.40
-.600
Silver May Comex
5.14
nc
30 Yr TBond June CBOT
97~12
+0~09
Dollar Index June NYBOT
106.68
+0.25
Market Report (4/19/00): Not much happening this morning save the U.S. trade deficit
coming in at another record -- $29.2 billion reflecting for the most part rising oil prices, which will
likely translate to higher prices on just about everything, which will induce Alan Greenspan to stay
the course on raising interest rates, which will pressure in turn the government deficit. Wall Street
can hardly suppress the yawn in the face of all this "tough reality" chugging ever onward -- "I
think I can.....I think I can..."(said The Little Engine That Could).
Along these lines, I received the Treasury Department's quarterly Bulletin last week and note that
the U.S. government for fiscal year 1999 took in $288.8 billion in revenues mostly from
individual income taxes. It paid out $118.3 billion in interest on the national debt of some $5.8
tillion. That amounts to 41% of the money collected went right back out the door to our nation's
creditors -- the largest being Carribean banking centers who hold about $500 billion in our paper,
according to the same report. To put it another way 41� of every tax dollar you send to the
government goes to pay interest on the national debt. It is the single largest budget item -- larger
than Defense ( second at $72.3 billion), larger than Human Services (third at $61.8 billion), larger
than Life.
Have you wondered why Alan Greenspan prefers the drip method of raising interest rates? It's
because he doesn't really want to raise interest rates any further than he has to cool off this red hot,
fully employed, equity rich, give-it-to-me-its-mine economy. If the Fed were to raise interest rates
a full point from here, it would add roughly another $58 billion to the interest figure. Then 61� of
every dollar you paid in taxes would go to pay interest on the national debt and the nation would
be technically bankrupt -- or at least close to being technically bankrupt. (I don't even want to get
into what would happen if we went into a recession and revenues plummetted.)
So the circle goes round and round, as someone once said. Sitting back and reflecting on this
scenario gives rise to a number of questions, not the least of which remains: "Is there anyway out
of this mess short of an economic collapse?" Washington's response to the budget mess is to try to
pretend it's not there and beyond that try to make the people believe that its no longer there -- that
magically somehow without even the slightest austerity measure things suddenly and inexplicably
fell into balance (a fantasy if not an outright lie).
In the same report it is posted that the government added another $69.597 billion to the national
debt in fiscal '99 -- not a record deficit by any means but far from the balanced budget both
political parties like to trumpet before the TV cameras. This deficit was made up by borrowing
from the Social Security Trust Fund and calling it an "off-budget" receipt. The best (only?) option
at this juncture might be to inflate our debt away. And that may be where we're headed seemingly
by some inexplicable force of nature. If you want a good reason to own gold, browse the just
released Treasury Bulletin, 2000 available through the Treasury Department. I've been thinking
about asking if they would let Centennial Precious Metals run an advertisement in it.
That's it for today, my friends. See you here tomorrow.
The May News & Views is at the printer and will be out shortly. We think you are going to like
this issue written during the weekend after the April 14 Wall Street Meltdown.
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 link above and make the appropriate entries.
"I would also suggest that a separate page be designated to/for ALL of ORO's work. His work, like FOA's, is something that I am always looking for and often need to refer back to."
Second that suggestion! I've fallen 2 months behind on editing out and maintaining my own ORO documents. One main thing I'm realizing about them is that they require second and maybe third readings, and reading in conjunction with one another, once my mind is limbered up (at least partway) to the level they call for. If others find this also to be true for themselves, then a separate ORO page would serve us all well.
Now, for a sneaky worktime peak at that juicy #29003.
Note: I will not be posting a commentary for the next four or five business days due to other
committments demanding my attention. I will probably post again next Wednesday --4/26/00.
Thank you. I will leave the following report up for that period of time because I feel it deals with
some crucial issues of importance to investors over the medium to long term, and I think new
visitors will find a good starting point for their own considerations.
The TV is black this shinning new day as I set here reflecting on your words of wisdom. If only you knew how much I wished you could be here to share my nightly walks. I perceive you to be that "fatherly" figure I have missed in life. Thinking about your words, your manner of expression, my mind pictures Solomon of the Bible, a man I have spent hours contemplating.
My treasure in life is not Gold or Silver or the lack of pocket change to do things I wish to do. I have enough of all three. My value in life is life. All the Gold and Silver in the world can not replace one night I spend walking around my humble little ranch, with my ever present dog, watching nature in its fullest. The enjoyment of a new leaf on the tree, or the bud of a new flower that I planted in the ground with my own hands. In simple reality, I want for nothing, save a special lady to share my enjoyment. In this misguide age of greed, self-centeredness, and self, I find the latter the hardest treasure to find.
The DOW, NASDAQ, and POG, I can not influence. The frustration I at times feel in a weak moment, I can influence, when I count my "true" blessings.
Primus & Aristotle & others are pointing us toward sharing our thoughts about life and our values in it.
Now, during gold's days of combat with a complex system of fiat "values", we are understandably concerned with understanding those mechanisms, and watching gold's price in those terms.
If, someday, gold surges limit up for many days, multiplies in dollar terms, and moves us all up the economic survival ladder a few notches, what are we going to say day after day after day? "Whoopee! Gold up another #__xxx___?" That might seem fairly crass, and even boring, after awhile.
I think this forum is, at its core, about learning to uncover and replace false values with real values. (I resisted capitalizing "false" and "real" -- I've been "shouting" too much lately.)
When we discuss our values in life, as made more possible to live by our recognition of the true monetary value embodied in gold, we share the essence of what we came here to do.
At that time, I believe a new level of maturation will overtake us a practiced and mutually trusting group, and we will handle that discussion with the same civility, curiosity, and intelligence that we have shown to date.
The Hoobits also second the nomination of Ari's msg #29008 for inclusion into the hall of fame.
Looks as if TC is going to be busy as that is two more HoF inserts today !
FANTASTIC # 29003 there ORO ! More thinking required. Tks.
<;-)
-Possible double top in US$ index
-CRB (oil) picking up steam
-Swiss sale freeing up BIS/Euro to be overtly pro gold (explanation compliments of Reg Howe)
feels like sunshine in the forcast starting next week!
gold is precious!
I try to understand markets from a supply/demand point of view. I agree with you- (28963)"The supply of cheap leased gold must be cut if a genuine and sustained gold bull is to develop." Mr. Howe has an editorial on the gold-eagle site wherein he speaks of the coming Euro Area sales and the Swiss sales. He proposes that they may be selling to one another to balance their books. He states, "The essence of the plan would be to allow the leased gold on the balance sheets of the EA central banks to be replaced by gold purchases from the Swiss, and leased gold on the SNB's balance sheets to be replaced by gold purchased from the Dutch and Austrians." It's a seven page editorial and can be found at www.gold-eagle.com , then click on editorials. Sorry, I'm can't seem to get the direct link correctly to post. Also, haven't yet read todays posts, someone may have already mentioned this. Let us know what you make of Mr. Howe's idea. Basically he thinks very little if any gold from the upcoming sales will reach the open market.
A perfect example of stock market insanity !Noticed this particular stock mentioned in today's earnings reports, and thought it would make a good subject example of the complete stock market insanity running amuck on Wall Street of late.
The stock is INKT, or Inktomi, a NASDAQ listed company that for the FIRST TIME registered a profit of a whopping 1 cent per share in the first quarter 2000. It had previously NEVER shown a per-share profit since going public, yet street analysists expected it to come in at a 2 cents per share loss for 1Q-2000. Instead, it "surprised" everyone (gasp) by showing an actual profit of 1 cent per share !!! This caused the price per share to jump $17.13 for the day to $133.13 (although it's 52 week high was at $241.50). On an annualized profit basis (if it holds), this gives this stock a current P/E ratio of 3328.25 to 1 ..........
I think there are more than a few of us who have refused to believe that little (if any) CB gold was making it's way into the open market. If the world CBs are in cahoots with one another for the simple objective of running down the price of gold under the guise of "dumping" their official reserves, there are really only a couple of reasons for their doing so..... 1) To keep the fiat game rolling right along, and 2) To "trade" as much of that fiat as possible for physical gold before the game is exposed.
If the full truth be known, all of these "gold opponents" are probably buying alot more physical than they claim to be "selling"......
Inktomi booked it's first profit of one cent--lots of companies "make their numbers" by one cent--even IBM sometimes. We all know about the 1990s accounting methods employed to get the nag to win by a nose.So there's no need to go into all that.--I haven't done the math, but Inktomi's penny of profit could well have been rewarded by "investors" with a boost in market cap of $500 mill. with today's action. Tomorrow we may need to post how does "$500 million become s penny in 24 hours".
I have been more out than in, lately, so if I am asking a question that is redundant, I apologize, now.
The Swiss gold sale bugs the hell out of me. Those Swiss bankers are a lot of things, but stupid is not one of them. There is no way that they are selling their gold for $280; so, are they going to get an "unknown exchange rate" price for their gold through the BIS?? And/or if they get a pocket full of Euros [the next world currency?]at "unknown exchange rate" prices, where have they hurt themselves???
It appears to this old country boy that they are dumb like foxes.
The recent release of the data from the Swiss CB that specified that they had leased a bunch more gold (600 tonnes up from 400? I don't have the numbers in front of me but I believe I read it in a recent market report) certainly reveals that at least some of the Euro CB's were leasing increasing amounts of gold before the Washington agreement. I have seen several people reply that they probably leased the gold out but then somehow retained physical possession of it, which you seem to imply in your post. I would like you or someone else to explain to me why anyone would lease gold if they did not take physical delivery of it. The whole point behind leasing gold is to sell it immediately upon leasing it, and then use the money to invest in some instrument (usually T-bills) that pays a greater return than the lease rate. My understanding is that it would be sold perhaps to some commercial user who might turn it into jewelery or whatever, thus leaving the market 'short' some gold. Why would you pay the person who leased the gold for it if he didn't give it to you?
Mr. ORO, I remember people mentioning an upcoming book that you are working on but it was long ago and I don't know if it was a suggestion aimed your way or someone asking as to the progress of a book in progress. Can we look forward to a book's birthing? Also, if so, can you recommend a title I can read now that will supply background (necessary) information/knowledge that will allow greater comprehension of and less difficulty in understanding your coming work? TIA RPowell
Good point re: Inktomi. However, their "total" market cap is at only 12.61B which makes "the numbers" look even worse. Such a rise for such minuscule earnings is "rewarding" no one but the individual investor holding the stock (back to the greater fool "Ponzi" theory). Once those stocks are "in the system" (shares outstanding), neither the "true" market cap nor the company immediately benefit from the rise, other than of course the "real profits" that remain within the company (if there actually ARE any).
Manfred Mann's Earth Band (70s rendition) "Blinded By The Light" should be dedicated to the Wall Street crowd on a regular basis by every radio station in the nation (grin).
"Proof" that a crash and a recession/depression can not be avoided in the U.S.
by the P.P.T./E.S.F, the Fed and/or the Treasury or it's Wall St. surrogates-- Goldman, Morgan-Stanley etc. etc. Michael Murphy said on his weekend hotline that investors should buy tech stocks on Monday because the P.P.T. would come in and support the Mkt., especially during an election year. He was right, so far. He, and his ilk will continue to be right as long as the virtuous circle is alive and well for stocks and the U.S. economy-When the virtuous circle ends and the wolf really arrives at the door, then all of these entities will be powerless to stop the disintegration. After such a long and persistent bull run, even the most die-hard bulls throw in the towel--but in case you doubt the previously mentioned "support team" will fail, I offer you a simple "proof". Namely, Japan--When I was in Tokyo, in 1989, I talked to all the top people in finance--they all said "we all cross the street together". meaning none of us would break ranks and sell. All of them could see no real end to the bull run. At that time Japanese banks were the largest and most influential banks in the world--They openly and admittedly cross-held each other's shares. The government was actively and openly behind the stock market in support--but when Granpa bear finally arrived, with his big ole darning needle, to pop the bubble, all the banks and all the government's men couldn't put Humpty together again--in retrospect, it seems impossible that such gigantic private and sovereign entities couldn't help arrest the catastrophe. Japan endured a 10 year bear mkt.. Japanese investors have sat on $10 trillion for a decade-that's certainly enuff fuel to start a rip-roarin bull mkt., isn't it? When investor psychology is broken and a bubble has burst, it takes a long time to repair the damage--and this happened to the Japanese, merely one of the most intelligent and industrious people in the world--we're not taling about Upper-Volta--so , boys and girls, it CAN and WILL happen here.David Tice has nicely chronicled all the excesses for us--we all know the bear case--It will happen and quite soon my intuition tells me--The fact that Asia & Europe have been non-plussed by our 2 day bounce is ominous. When real fear and terror grips U.S. investors, I believe that the iron grip on gold will be relinquished too and we may be treated to some limit up days.
Welcome Richard! I am an admirer of your Gold-Eagle posts and am thrilled that you are posting here also. Do you ever sleep, or do you just post all day and night?
Everyone, I'm in AWE of the wonderful, eloquent writings here yesterday and today. Christopher, your beautiful message yesterday brought tears to my eyes.
The big question--
Is the "House of Cards" going to fall next week? Or next year?
I am on the edge of my seat watching the world play out.
What exciting times we live in!
The difference (as I understand it) is between the so-called "lease" (expecting the gold to be returned) and the outright "sale" (never expecting to see it again). CBs can lease back and forth, or even buy and sell back and forth, with little or no "net results" (or physical exchange of metal) as far as the world monetary systems are concerned. But when the private sector becomes involved, it all turns into a giant game of "musical chairs", or who will be the last one caught with their pants down when the music stops. As a simple continuation of the paper gold game, there doesn't necessarily "need" to be any physical delivery of the leased gold unless (as you point out) it does happen to be for fabrication purposes. There are "tons" of precious metals bought, leased, traded, etc. on a constant basis which may never leave the confines of the depositories, whether public or private in nature.
Contrary to what "governments" would like for us all to believe, many see this "worthless gold" charade as nothing more than a ploy for governments to do exactly the OPPOSITE of what they claim to be doing (surprise !), i.e. making the true wealth of this world appear worthless for their own benefits, whether that consists of acquiring more gold for the CBs or simply discrediting it for the sake of keeping the fiat afloat a little longer. After all, fiat currency is much more controllable (and cheaper to produce) than gold could ever be.
Let's suppose for a moment that the world CBs had some diabolical scheme to return the world to a gold standard. Would they do so after selling off their "backing" (i.e. reserve gold holdings), or would they first create a general concensis with the world population that "gold is a worthless, barbaric relic of the past", all the while accumulating as much "backing" as possible and/or creating conditions to bankrupt and nationalize gold mining operations in the process (at as low a price as possible no less) ? Surely governments wouldn't buy at such a low price and then "revalue" at higher levels once they were in the most advantageous position to do so, just so they could create more "economy value" via the printing presses.
With the stroke of a pen, paper currencies could become immediately worthless. Those of us who hold physical gold, on the other hand, have it within our OWN powers to tell the politicians exactly where they can stick that same pen......
Picking apart the U.S. Trade figures relased today for February. You'd better sit down for this...
http://www.census.gov/foreign-trade/www/press.htmlFirst a review of last month's commentary where we gave a perspective-building overview of the activity in recent months:
---------
TownCrier (03/21/00; 08:50:39MDT - Msg ID:27209)
...We created quite a stir in January when we revealed that the latest release of data from the U.S. Department of Commerce indicated a rocketing level of gold exports from the U.S., with November's gold exports (that level passing through customs, not including any transfer of ownership that stays within the vaults of the Federal Reserve on behalf of the foreign owner) leaping above October's $400 million export level to top $1 billion. In December, that number settled back to the still impressive level of $783 million, while in January gold exports continued to tip the scales at $730 million.
...
To assist you with your own quick calculations to determine the significance of these levels, gold at current prices is about $10 per gram...with one million grams per tonne you have $10 million per tonne. That gives you 22.5 tonnes exported in January of last year pointing toward a 270 tonne annual pace...but recall that November alone grew by 100 tonnes. Meanwhile in modern times, this January's export of 73 tonnes puts us on an annual pace of 876 tonnes. See a trend? Are you getting your share of gold even as the rest of the world is laying claim to theirs?
------
A simple statement of the overall balance of trade situation for the short month of February is that the Department of Commerce announced total February exports ($84.2 billion) and imports ($113.4 billion) resulted in a new record monthly goods and services deficit of $29.2 billion, $1.8 billion more than the revised deficit figures for January ($27.4 billion).
The breakdown is February exports fell by $0.2 billion, while imports rose by $1.6 billion over January.
Shall we look at the gold numbers for the month to see if the past trend remains intact? Let's do.
While many of our goods export sub-categories suffered a monthly decline, the category which includes gold, "Industrial supplies and materials" lead the other various sub-categories with a $0.3 billion increase.
Within this "Industrial supplies and materials" sub-category, gold topped the list of all others with the largest export increase over the month of January. While January's gold exports were $727 million, February's totals lept up to $921 million for a monthly increase of $194 million in export demand for our gold.
To give this additional perspective, here were the top three export items in this category along with their monthly increase (expressed in millions):
NOTE: "Nonmonetary gold" is the official government name for gold outside of the Treasury or Federal Reserve system, so don't let that throw you. Gold is gold.
Once again, using a very approximate calculation of $10 per gram, February's gold exports clibed to 92 tonnes.
Is this a new development, you ask? How does this compare to exactly one year ago?
In the first two months of 1999, our gold exports totaled $448 million (about 45 tonnes; for an annual pace (at the time...it jumped later in the year) of 270 tonnes. As I reported at another time, U.S. gold production in 1999 was 354 tonnes. (These particular export figures are approximately on par with U.S. gold imports for this period last year and this year also.)
Rolling the clock forward to this year, the first two months of gold exports have totaled $1.648 BILLION (approx 165 tonnes; for an annual pace thus far of 990 tonnes for this year.)
Looking at the ENTIRE field of goods exported, there is ONLY ONE specific item that outpaced the year-to-date increase in export demand witnessed for gold.
While the above figures reveal that 2000 year-to-date foreign demand for gold grew by $1.2 billion over 1999 year-to-date values, only the foreign demand of U.S. semiconductors saw more gains in consumption, increasing by $1.515 billion over the same two month period.
However, consider this...the size of these markets.
Last year, the Jan-Feb demand for semiconductors was $6.944 billion, so this year's increase represents an impressive gain in total demand of 22%. That's very nice, and is about what you might expect for this very important and vibarant sector of the rapidly growing technology sector.
Looking at this same growth factor in foreign demand for gold this year compared to the Jan-Feb figures of last year, the increase is a whopping 268 percent!
Gold blows the technology leader right out of the water! What do you think about this "barbarous relic" now?
This trend in gold demand by the rest of the world incontrovertible...there's no need for the jury to retire. In all my years of judging I have never heard before of something more deserving of the full discipline of your attention.
The rest of the world is voraciously laying claim to gold. They are getting theirs. Do you have yours?
Awesome, awesome posts today. You guys are the best!!
Would the real Alan Greenspan please step forward.
Another 'dead cat bounce' Sir Stranger! The transmission in the ol' model A can't hold the 'rev's' anymore. The bulls are trapped!!
Oro is 'da man'! Whoo, what a wicked post this am, rattles the molars for sure. MK with the 'debt servicing' stats, skating on the pond in mid-April is scary business.
Feb. deficit @ 29 billion, would like to see the total debt now, approaching and encroaching $6 trillion perhaps; that's a million million son.
Took the 12 year old son into the bank today, laid another
(I like the word 'another') silver block into the deposit box.
The young lad says, "Why are buying more silver Dad?"
"Just changing dollars into silver son, just changing one currency into another"
" The dollar is going to crash Dad?"
"See this gold and silver currency son (looking into the box), there's going to be a major shift in value soon"
"How do you know that?"
"What did your mother do last week?"
"She sold all of her stock last week."
"Yeah, and so did did everyone else, people are getting nervous about their money, soon people will start to buy hard, tangible things"
Has anyone considered the possibility that this is foreign owned gold that was kept in the US for safekeeping in diversified locations. With the recent turn of events, it is possible that they no longer trust us to keep their gold for them (This would be ominous indeed). The US has a bad habit of appropriating the assets of other nations it doesn't happen to like. Witness Iran/Iraq. Should the US not take kindly to the self-destruction of the US$ and have the press spin the BIS/Euro cadre badly. We just might be too tempted to just appropriate what they left here for safekeeping just to "balance the books". I wouldn't trust us at this point if I were them...would you? Non-monetary gold = gold outside the treasury/fed system = gold that doesn't belong to us.
My wife will not let me put your post on the main wall! Can You imagine that? I had an unused frame from the local custom picture shop,,,,, nice, big real wood frame. Was thinking of mounting your post in that frame. Then put it on the entry wall of our home where all our guest would have to read it and no doubt comment on it. Now I guess it will just have to stay in my office.
Besides that I didn't really see anything in it that qualified for the HOF? ( bet you think I made this up) (grin)
Thanks to you and to everyone for reaching beyond themselves in the search for and sharing of understanding.
Excelent! ----- ORO (4/19/2000; 0:05:39MDT - Msg ID:29003) ---------
You write: "I think this forum is, at its core, about learning to uncover and replace false values with real values."
I agree. You have nailed one of the particular qualities that make the USAGold forum attractive.
To be sure that you see the special significance of gold, you should know that Febrary exports of all other precious metals combined were only $163 million, a huge (percetage-wise) decline of $60 million from the previous month.
Only gold is on their radar screens.
----
BTW, the Hall of Fame has already been updated (since ealier this morning) to include the posts by Sirs Asher and ORO. Our good friend Ari will have to be patient for a while as other tasks currently beckon our attetion here in The Tower.
http://www.usagold.comTo all the knowledgeable people here: look at the 24 hour gold price chart, why it always drops at New York, day in, day out?! It does fit into the conspiracy theory. How the people in this forum answer and explain this?
Sir TownCrier #29050....U.S. export figures on Gold.
Townie, those Gold export figures are astounding when Dec. 1999 and Nov. 1999(105 tonnes) are added together in a four month period.At this rate the U.S. may export 900 to 1000 tonnes in a 12 month period Nov.1999 to Nov.2000, and the U.S. only produces 354 tonnes of Gold annually? I strongly suggest e-mailing the top two financial publications in the U.S. with your full #29050 post.
It is the responsibility of a newspaper to print factual news.
Here is Barrons e-mail address:
http://ads.barrons.com/company
I would add "Please forward to Cheryl Strauss Einhorn Commodities Corner."
Here is The Wall Street Journal e-mail address:
http://wsj.com
You could forward this to "Letters to the Editor department."
Way to go. You did it again. You too Peter and Ari.
ORO,
You are getting much like TG. You speak with authority as a teacher and sage leaving one with the thirst for more. I must ask you as it wasn't clear to me, who are those that have so engineered our system that they could hold back resources in the US for such a period of time under the guise of environmentalist?
Also, it is mighty coincidental that the Second Amendment should come under attack at a time when within eight months (your estimate) all the gold will be gone to fullfill contracts. In other words, what is the societal motivation to disarm Americans whilst the dollar lives its last strong days, headed for weaker ones? Put simply, what is the cause or root of the correlation between gun control and gold control? This is not just a coincidence, is it? Why?
Towncrier,
Just so I make the obvious apparent. Are you saying that the largest export was gold, or the largest growth in exports from the US was gold? Also, what is the source of this gold if it is not official gold? I know ORO thought it was a special stash, but what is your take?
My friend the coin dealer told me today that premium's are up on Gold and Silver eagles and he felt that all the Y2K dishoarding is now done. He also told me that 1996 Silver Eagles were 17.00 per coin. He also pointed out that only two years of silver remain in the strategic reserve and after that the mint will have to buy silver in the open market.
Excellent analysis. I wonder if the the planners, as Greenspan, consider the continued immigration of all levels of workers (not specifically the technologically-trained, as you seem to imply)a key factor in maintaining a strong economy? I have heard they do, but I do not have the figures that would support it. Have you estimates for this?
This was my thinking after providing last month's figures when I responded to Sir ORO's similar request for my speculation on the matter:
- - - - - - - - - - - - - - - - - - - - -
TownCrier (3/23/2000; 21:07:26MDT - Msg ID:27386)
ORO, I'm glad you noticed the startling trade figures I posted two days ago (March 21st, a.m.) focusing on the trend of huge gold exports from the U.S. It surprises me that this didn't raise more eyebrows or comments among our group here. Worth repeating is that any gold that moves into foreign ownership but is maintained in U.S. storage does not get counted among these export figures.
Sorry for the delay in providing my speculation as to the source of this gold. Here it is...
...on an annual export pace of approximately 876 tonnes judging from January's "slackened" export level, compared to our annual production rate of 354 tonnes, you can see that this gold is more than double the amount that our mining companies might be providing in the form of gold loan payments and outright sales channeled through the likes of the LBMA member banks.
What is making up the bulk of the shortfall beyond the first order supply? We can probably take a cue from Michael's own operation at Centennial where he has agents seeking and negotiating for the caches of Old World treasures. As private holders for whatever reason reach a state of mind that they would prefer to exchange their hard assets for national currencies, this gold enters the export stream alongside new production.
With our current equities markets beguiling and captivating masses of sophisticated and unsophisticated investors alike, is it any wonder that tonnes of ounces are trickling out of the woodwork to fill this overseas demand? After all, there is only 32,151 troy ounces in a tonne. Create enough disinterest among individuals to give up their few ounces of near-irreplacible metal for a few hundred dollars of instant cash, and you can see that the difference can be perhaps be satisfied...for a while. At these rates, it won't last long...
- - - - - - - - - - - - - - -
Your words of today, SteveH, seem to support this thought. You said, "My friend the coin dealer told me today that premium's are up on Gold and Silver eagles and he felt that all the Y2K dishoarding is now done."
Sir Henri was also a perceptive reader, and picked up on the distinction for the accounting of this exported gold. Some of this gold could have indeed been purchased by foreign interests in past years, and as long as it was maintained in storage here, it wouldn't appear to get counted as an official export until it passed through customs.
Keep in mind that this is altogether different than foreign owned gold that was brought here for temporary safe keeping, and then repatriated. That gold would not show up in these figures because it would have the proper paperwork pedigree for customs such that it would never have been counted as an American asset or good to begin with. We can't count exports that were never offically ours.
Keep in mind that what is tracked here in these specific export figures is "nonmonetary gold"...the stuff that isn't in the banking system as official "monetary gold" reserves.
I may be wrong about this, and perhaps Trail Guide may come to my rescue, but I have the impression that central banks cannot indescriminately (or discriminately) play fast and loose with the purchase of "nonmonetary" gold on the open market in order to bolster their official reserves of monetary gold. This would be cheating, now wouldn't it...for an official player to obtain this special asset at the carefully crafted illusion of the paper price? Please think about that.
That is why you don't see official global holdings of gold increasing by leaps and bounds as the many years wear onward. There is a rather official process for the official "conversion" of nonmonetary gold to become counted among official reserve assets. Instead, the same official "monetary" gold holdings are basically allocated back and forth as conditions warrant. Therefore, we see that most of the newly mined gold goes into private hands, not central banks. But of course, there are easily identified exceptions...mostly among the "less fortunates" that need a break. The Central Bank of Russia, for example, announced for all the world to see last year that it had embarked upon its intentions of buying (approximately 100 tonnes?) from its member banks, who themselves bought it from the local miners. I would tend to say that China's central bank also had a special relationship with it's local gold market. What became of this gold with regard to their official books, perhaps only the BIS can say. I cannot. But as they are now moving to open up their gold market, and with the only BIS branch office now "in town", I would venture the guess that China is either going to start playing by the existing rules for the western CBs with regard to gold, or else the WHOLE system will be changed.
By "changed" I mean that perhaps the distinction between "montary" and "nonmonetary" gold will be dropped officially because there will no longer be a valuation difference between gold carried on the official books, and gold as priced by the illusory open market for those of us on the oustside. Once our "open market" paper system of price discovery collapses we would all then know the true valuation of gold....banker and baker and shoe-shine boy and candlestick-maker all on equal footing under the eyes of the Sun.
I believe the idea of a large stash of gold was discussed previously here with the possibility of the gold having its origins in the Phillipines, if memory serves. There may be another possibility. As you all know, the U.S. government has been selling off its "strategic reserves" of silver and platinum for some years now. I ask all of you, knowing how the U.S. operated in matters concerning surviving a nuclear attack (remember the secret, hidden Congressional facilities in West Virginia?) I would find it very strange if there had NOT been a "strategic reserve" of gold, just as there was of silver and platinum. This reserve would be separate from that held by the Treasury. I also can understand why it would be kept secret...gold is THE most important precious metal.
The following was reposted on Kitco last night...it is originally from the Gold-Eage Forum, posted yesterday. I have no idea if the information contains specific truth or not, but the general idea of the U.S. government maintaining a secret hoard of gold would not surprise me in the least. I would also expect that IF such a hoard existed, THIS administration would have no qualms in selling it. What a great topic for an investigative journalist!
Here's the post:
Gold1500....
( Ben ) Apr 18, 15:13
Everyone has there "conspiracy theories" right? So, here's my two cents on all of that. I tend to lean towards agreeing with the story by Chris Osborne about the US buying all of the GOLD. Let me tell you why....
About five years ago, I was sitting in the airport waiting to pick up my father in law and a friend of his. They had decided to meet each other in Baltimore and spend about two weeks together.
As I was driving home, I was inquiring as to the former occupation of my father in laws friend. He told me he worked for the CIA for over 30 years and had a very high clearance at one time. Now, imagine if you will, a very aged gentlemen with a pretty sharp memory.....but you could tell that he would talk a little too much about things he had seen and participated in and catch himself doing this at certain times. Maybe he was starting to lose his marbles....I don't know. He was very educated. That I do know. He rambled on about weather experiments and satellites and all that. He then touched on GOLD. Being a GOLDbug most of my life, I pressed him on the subject of FT. KNOX and such. He said, "Son, the amount of Gold in Ft. Knox is a speck of dust on the head of a pin compared to the amount that we've got stashed in the Salt Mines in Utah." I was blown away..... I'll never forget it. He said that there is a mountain in Utah somewhere ( I can't remember the name because I was so shocked at the next sentence ) that is filled with more GOLD bullion that is publicly accounted for in any fashion! He said the US gov't has enough to wipe every slate clean in the treasury. They keep it as a hedge against total financial armegeddon and ensure that they can always be a monetary superpower. No matter what.
Take it as you will. Was he BSing me? I don't know.
Remember, neither Ft. Knox nor the New York Federal Reserve Gold Vault could survive a direct hit from a nuclear warhead, and the coordinates of both locations are widely known...hmmm, very interesting!
By virtue of the fact that you have occasionally quoted some of my thoughts...I know that we are on the same wavelength...I also must say, that as long as Sir oldgold keeps to factual arguments (and avoids character rhetoric) I appreciate some of the discord which his apparent anti-gold statements insight here....we must all stay on our toes.
As much as I appreciate your total overview, and walk the trail each time we strike camp and move on, I still have a lot of trouble with the idea of serious hyperinflation of the dollar. The dollar IMHO represents a defacto gold standard to many people in the world...here is a very practical example...the parents of my Russian wife were over for a visit a couple years ago and I had to absolutely insist that they accept 5 little french roosters from me to tuck away for an emergency...the father said he would have absolutely no idea how to cash them in and would consider it dangerous....they would much rather have crispy $100 bills!!!!
The point here is that only a very small fraction of the world's citizens will ever be able to "understand" golds real monetary role.. they will always understand money as fiat...and I know Trail Guide that you agree completely on the need to have a fiat (with gold trading in the background).
So, very undoubtedly, there will be a battle of the fiats...the world will see but not understand why the Euro and Swiss Franc are doing so well and the dollar and Yen loose ground.
But unlike the Weimar hyperinflation, where the German govt used the presses to buy up local products for govt consumption, the dollar has been used to keep a growing international market liquid enough to maintain growth. Erosion of the dollar value is an international threat to a strongly entrenched INTERNATIONAL system...there is so much inertia built into the dollar system, that it can only destructure slowly (or many will literally starve). Also remember that the "American Way" may be unpopular in niches but it has a massive global acceptance right now..a psychological support for the dollar.
Gold is certainly the best hedge against the coming fiat turmoil, but anyone who bets on a strong demise of the dollar (to less than 50% of today's purchasing power within 2 years) is at risk of underestimating the fact that money or no money, America has been the leading economy in the most magnificient 1/2 century in mankind's collective history (in regards to material advancement).
As strong as the Euro may become, when supported on a solid bedrock of gold, there is no way that Europe currently has the type of "idealogical" makeup to dominate the world's economic psyche the way America has....rather, we are heading into a period of unprecendented multi-polarity...and even a bankrupt America will have a strong hand in shaping that shared future...the dollar will still be there (perhaps seriously wounded). I fear that those who will loose out the most are the retirees who rely mainly on FED pensions, Medicare, and Soc Sec...my Russian mother in law gets a $20 per month pension....after a life long labor!!!
I once got quite a response here when I stated "only by convention was gold worth more than composted banana peels"...I stand corrected insofar as gold makes beautiful everlasting heirloom jewelry. But as a monetary asset, gold's value is based on convention...as too the dollar's value is based on convention. Gold paper contracts may oneday burn but it will be a much greater battle to pull the international convention built around the dollar into a similar destruction. It is not only a great battle of fiats...it is a great battle of deeply entrenched psychological values, in a modern economy where there are really some "new" aspects that defy the "older ways".
We goldbugs must truely stay on our toes as we skirt the edges of Mirkwood.
You make a very good point. Only a change in settlement for oil would get the world's attention. Truly, that must be the key. However, having said that, I do not believe the ME has any favorite when it comes to fiats. Euro or dollar; I'll bet they care not a whit. They hold the trump hand. They will negotiate the very best deal they can make and, they will get it.
I believe the future of the dollar depends more upon the defensive strategy formulated by the US than the entrenched system you make reference to. I will agree, it most certainly is entrenched! By the way, I am hoping there is a plan. We've discussed this before here and no one has come forward and suggested there has been or might be contingency planning. The discussion of a secret "hoard" is all I have seen.
If come tomorrow circumstances clearly dictated the dollars in my (foreign) pocket to be greatly reduced in purchasing power and it was evident there was more value in say, Irish Punts, why, I'd head straight to the exchange counter, dump my dollars taking my lumps if need be and I'd try and learn as much as I could as fast as I could about the Irish Punt. If Punts by more bread and sausages than dollars, my money's on the Punt. Good evening all.......CM
http://www.monex.com/prices.html"My friend the coin dealer told me today that premium's are up on Gold and Silver eagles and he felt that all the Y2K dishoarding is now done. He also told me that 1996 Silver Eagles were 17.00 per coin. He also pointed out that only two years of silver remain in the strategic reserve and after that the mint will have to buy silver in the open market."
----
Steve, the above link at monex is an excellent barometer of bullion coin premiums....today eagles in 500 coin units are available for about $8.50 and I have a hard time believing that 1996 Eagles command a $17 price. If this is true, then it does speak of an emerging "investment demand" in silver. Also, it is very useful to watch the premium on junk silver...today at almost zero...in the heat of y2k prepping it got to almost 50% (parity with eagles normal premium lately). It is actually astonishing that in some silver junk units, there is a large number of "almost uncirculated" 1964 specimens...currently "worth" about about $1 each...so if Americans can get excited enough to hoard Sacagawa dollars (which will only increase in supply), why can't they get the fever for nice silver specimens as well??? Time will tell.
Who is buying all this American Gold?......Some speculation.
As sir TownCrier states, official sources(countrys) are not showing large increases in Gold inventory. That leaves the private sector. Well I would say Japan has the U.S dollars to buy large amounts of Gold, but Japanese imports are tightly controlled by the Government, and they are probably buying Gold jewlery only.
IMHO the big buyers are the same people who in the last 6 months or so got a 150% payraise in U.S. dollars.....The oil producers of the world!
The entire mideast region is controlled by wealthy family's and real wealth(Gold) in that region may be untrackable.
For instance, when Kuwait lent 79 tonnes of Gold last year, that may have been Gold owned by the country of Kuwait, but I really doubt if any privatly owned Gold was lent.Members of Royal familys in that area may own large amounts of Gold.(strong hands)
Billions of U.S. dollars are being spent on oil every day, couldn't some of them(dollars) be purchasing Gold in off market transactions in what we would consider large amounts? Where is the revenue from oil production going?
Indonesia also is an oil producer and considering the very recent financial turmoil in their country,Gold bought with U.S. dollars obtained thru the sale of oil may be happening there also.
Just a few thoughts to share....beesting.
Regarding the 79 tons of gold leased by the Government of Kuwait-
Could the leasing of that gold have been so that some wealthy ME family could purchase the governments gold, without actually stealing it?
If the public found out that the governments gold was stolen they would get mad.
If some family wanted the gold, but stealing it from the government would be criminal, then organizing the legal purchasing of that gold would go unnoticed, right?
Whatever. Just some stray thoughts tickling my gray matter.
The "RUMER" was the 79 tonnes of Gold that Kuwait lent was some kind of deal between The Bank of England and LBMA....a bail out???...who really knows what goes on in the mysterious world of Gold trading???...beesting.
Today's posts by Lamprey, Henri, Town Crier, aunuggets, R Powell
This is culled and edited out of Msg#21666-12/26 from the "5 Event contest."
Lamprey: note the caps in the next-to-last paragraph.
The unfolding of the BOE auctions opened up many eyes and focused much attention on the fact that the gold market was not operating on free-market principles or government non-intervention. The other important result of this was the proof that market sentiment was a stronger influence on the price of gold than the quantitative fundamentals of supply and demand. But the auctions should be seen as a secondary factor; a maneuver in a larger scheme. The BOE, the Bullion banks, the Mines and the gold carry traders may be loose cannons, dupes accommodaters or pawns, but they are not the main players.
The Washington Agreement changed nothing quantitatively at that specific moment, it was a change in policy which will, and already has, caused quantitative shifts in supply and demand. That is why I called The September Spike a "News driven rally" The effects of the agreement have only begun to affect the balance.
Short covering is a squaring of books, not a permanent change in the underlying fundamentals of supply and demand. In the long run, it is the quantities of forward sales relegated to replace borrowed gold hoards rather than new ownership and industrial consumption that will create a reduction in the supply factor. But does that quantity play a major role?
The hoarding and dis-hoarding of national gold reserves is the largest quantitative factor in the distribution of above ground inventories. Therefore the advent of the Gold backed Euro and the Washington agreement are the most basic fundamental changes in the gold marketplace. For whatever reasons exist to be contemplated and discovered, these two events are surly part of a piece.
The US trade deficit is only maintainable by the fact of the dollar being the reserve currency of the world. The entity whose economy is backed by the reserve currency of the world, can consume more than it produces. The deficit is offset by the float! Euroland has been on the short end of this stick to date. It would behoove them to attempt to replace the dollar with the Euro. As even their composite economy does not have the magnitude of ours, how better to sway the World's traders than to back the currency, increasingly, with gold? If the marketplace can be controlled sufficiently for all leased gold to be returned to the CB vaults, then the lower price of gold will have created a net buying opportunity. Low prices will only have created losses on the quantities delivered into the open market. It does not hurt a Central Bank to loose value on its hoard for a few years if it still has it when the price recovers. Look not at what they sell, but at what they keep!
We may have only seen the first part of an ongoing strategy in which the Central Banks will increase their gold reserves. This is not the only possible theory of the hidden reasons behind the manipulation of the POG, but the events of last year do fit it well. It is still early in the Game!
Wow, 106K of text, and not one mention of gun rights! I know some of us tire of lengthy, off-topic posts, so I'll merely refer to an excellent column by Fred Barnes which discusses a recent CNN poll re: gun laws.
It seems, despite Clinton's and the media's best efforts, that attitudes are changing toward favoring enforcing the laws we have rather than passing newer, more restrictive laws. Let's hope some of the politicans covering their butts by sponsoring some 50-odd bills will get the message soon.
The column suggests some small ray of hope, and is well written. You can find it at the NY Post Web site (see Tues., Apr. 18 edition). I accessed it via Matt Drudge's site.
The nightly PATSY Index shows the relative
amount that GoldBugs have been conipulated.
XAU=56.60 + POG=279.40 + POS=5.08
-equals-
341.08
Up +0.27 from Tuesday. YeeHaa(?)
Comment: I'm unsure anymore of what's the "actual"
price of gold (etc). There's Paper_Gold. There's
Physical_Gold. There's Spot_Gold. I post here the
Spot_Gold. But I'd rather post the Absoloute Most
Real price imaginable... So I'll just ask Aristotle:
"At what price would you part-with an ounce of yours.?."
Would everyone accept that as an Absoloute GoldPrice.?.
Next, I want to mention a thought I recently had: If
there's to be a two-tier GoldPrice soon, of PaperGold
markets, -vs- an off-screen Physical price, which all
would agree, is going to be much higher than PaperGold,
then *that's* the price that GoldMines will get for their
SolidGold when they sell it. ... Therefore, my thinking
is that GoldShares (Mining Stocks) will go *UP* to track
that off-screen pricing. Because they will be the *only*
viable source of real SolidGold in the future.
Maybe my NEMont Shares aren't such a silly idea afterall.!.
I can't wait to spend all those increased dividends. Maybe
I'll finally be able to buy some Silver. If there's any to
be found. Warren: What's YOUR Price.?.
Prediction: More (or less) of the same, tomorrow. It appears
that the PPT took the day off. Probably attended a big
meeting to decide what to manipulate tomorrow. And they had
other important things to do today: Coloring Easter eggs for
the WhiteHouse EggRoll.
ThaiGold...
Got Some.?. ... Get Some.!.
===========================================================
Yes, I very much agree...reserve currency status allows for certain privileges. The problem, as we all know, is how to get or retain reserve status.
Even IF the U.S. has and is selling off secret reserves, we still maintain a very large, Treasury-held reserve (so I'm told ;-). My question is, do we have enough gold considering the increasing amount of dollars being floated around the world and/or should we revalue the reserves higher?
As an aside, I find it VERY strange when commentators attempt to confuse by saying that gold is now just another commodity without a monetary role. I may have missed it somewhere, but I don't recall hearing of CB's filling their vaults with coffee beans, zinc, or grain!
...."It does not hurt a central bank to loose value on it's hoard for a few years if it still has it when the price recovers. Look not at what they sell, but at what they keep".....
Reminds me of the "insane" professor in the movie Patch Adams when he holds up 4 fingers and asks "How many fingers do you see?" Only later do we realize the sought after answer of 8 fingers, seen only by "looking past the problem".
How many of us look at our private gold accumulations in terms of "how many dollars is it worth" rather than "how many ounces do I own" ?
If a central bank holds 250 metric tons of gold in reserve and never disposes of any of that amount, they will always have the same "wealth value" inherent to 250 metric tons of gold. The fluctuating "dollar (or ?) value" is really a moot point except and until it is time to transition into one of the fiat currencies in order to further transition into something else that we desire to "trade" our gold for.
The most liquid asset of any society or culture will always be considered it's "cash" or "money", whether that consists of precious metals, fiat paper, or whatever the case may be, and to that end, there will most likely always be a need for some type of fiat to act in place of "true items of wealth". To what degree that fiat is an "honest representation" of our true wealth will depend upon the issuer of that fiat, or upon those of us who bestow such power on the individuals responsible for making that ultimate decision. No politician, no judge, no police officer or other person has any more "power" than that which is given to him or her by others.
As with the computer generated 3-D images popular over the past several years, you have to "look beyond the problem" to see a clear picture.
There are a couple of things discussed quite openly on CSPAN coverage of house and senate committee testimonies on banking and oil, as well as forestry. Gun control seemed to have a staged feel and was far from candid.
The environmentalists are thinking that they are being supported by "good ole boys" that have suddenly changed their view. The Energy committee was quite clear as to the motivation for this, though it was never stated outright. Some of the same members sit on the Banking committee. If they got 2 cents from the one committee and 2 cents from the other, it is obvious that they would be coming up with 4 cents.
The key is that there is awareness of the US debt situation, and if someone sleeps in one meetingm Greenspan will remind them at the beginning and end of each testimony to include thoughts of a world where dollars are avoided like the plague. He (and others) repeatedly tell the congress that the continuing support for the dollar is on thin ice and that he does not know when it will end.
If you expect that resources you now have but can import are not going to be available in the future because of the fall of the dollar reserve system, what would you do?
I suggest that while the dollar reserve system operates, you put out of bounds any use of these resources so long as foreign ones are available.
If you expect to see a steep loss of dollar purchasing power abroad and the probable result being an internal price inflation that would eradicate savings and make mincemeat out of financial assets, then you will find very many ME generation folks very unhappy. With today's encryption and communication possibilities, the former impediments to these politically active "unhappy" people actually mobilizing in a way that poses a threat to the control of our not-quite-elected government at all levels, is very real.
-----------------------------
The following is a rather broad and unfocused discussion of motivations and possible dynamics for the gun control initiatives.
Government has not had any worry about criminals. They don't want to take control of government. Government fears that Jesse Ventura types, and even less main-stream political figures would wrest control away from the two parties in one system we have today.
The most important steps in political control are the equivalent of mowing your lawn so that all the grass is even and keeping well selected flowers in beds located for display. Grass creeping into the beds and flowers in the lawn will offend the political gardner's genteel senses. The first thing these new political weeds meet when challanging the government is labeled "extremist" or "special interests". Then their leaders are approached with promisses and threats. The big parties then proceed to "kidnap" the ideas that caught peoples imaginations, or if they threaten power they act to demonize those who hold them.
The problem now is that any group can organize an underground organization easilly, and they can find recruits off the net. They can reach audiences across the globe and across the country. While many may have thought themselves alone in their thinking, today finding someone likeminded is very easy. Ease of instantaneous communication on the part of individuals is now on a par with that of government agents. Secrecy is nearly as easy to obtain if you really want it and are willing to pursue it. The control of mass media is slowly becoming irrelevant. People can find crackpots like us wherever they go on the net. As this continues, people will doubt more and more what the mass media and government are saying. The next stage is the one I arrived at: what is on the TV screen or said by officialdom is either one of the following 1. a lie, 2. not relevant, 3. a smoke screen meant to draw attention away from what is important.
Government will lose further credibility and lose its ability to act in secret when supressing upstarts. The initial size of new movements has grown from dozens at a few localities to thousands across the country and they have support from abroad. Tbese can make government coercion public in microseconds. The resoponse by the sympathyzers can be immediate. If they are well armed, the results can be terrible and swift. Government actions would be broadcast widely, as would the fact of resistance. It is now imperative to take guns out of the hands people who have property and famillies to protect, are active in their communities, and are sufficiently good citizens to feel self righteous when they are trampled. Criminals can have their guns, we can't.
The whole control process whereby all candidates are selected by the same people for both parties after careful screening before they are allowed to compete for attention within the parties would become irrelevant if the information dissemination structure continues to diffuse. Party candidates would be irrelevant. The possibility that when the political mowing or weeding is attempted there would be retaliation and resistance is unsettling, if not frightening to those that contol the "emergence" process within both parties. They need to make sure that the people that challange the legitimacy of the elective and legislative process can't do anything about it after they are supressed. Acquiesence to power must be complete. Resistance must be made impossible. The window of opportunity is closing and it may already be too late.
I will say that the "understanding" between socialists and bankers is deteriorating. The fact that Ventura was elected and is given wide media exposure is a sign of dissention in the ranks of our little elite. If I am right, some of the elite will be supporting libertarians or inducting libertarians into the two main parties. There may actually be a process of retrenchment from the political control system by the bankers if the government becomes useless to them, or worse yet, if the government becomes a threat. The decline of the dollar will most probably make the government of little use to bankers.
The government agencies themselves continuously seek more power. It is natural. When possible, they are sought by allies among corporations, unions and various agenda groups. These allies will provide the government official with the structure of the strategy that would enhance the official's power.
In the case of the CIA, FBI, BATF, NSA etc. authority expansion is the main motive for anything they do. None have express constitutional authority, and they operate outside any civil review or control over their powers. The only things controling them are the rules they must follow in order to maintain de-facto authority. These rules are put before congress repeatedly for rearrangement so as to enhance their power and reduce control over them.
The "law invetion" and arbitrary force agencies are seeking to make their jobs easier. To make clear why the top echelon feels both justified and empowered you need only look at our educational system.
Most people in top positions had private education or were educated at State universities. Ivy league universities educate with endowments controlled by other academics, former politicos, and top financial leaders. Their research budget was composed of government grants. Without these grants the professor can't keep his job on the way to tenure. The results of his work must keep his sponsors happy.
The fact that a university is state funded is enough to obtain partial control over its academic hiring process. The fact that the bulk of money for educating future professors comes from the Federal and State governments is sufficient to keep the political science and humanities faculty in any reputable university on the socialist side. If their funding comes from government they will allways come to the conclusion that government should have the money to give them, or better yet, that government should finance or buy the product of their soon to be created corporation or create a department which they or their graduate students will control.
How would a research project labeled "Doed the National Institute of Health Destroy Effective Research in Medicine" be received by the NIH? How would DARPA react to research projects questioning its usefulness? How would the Fed or Treasury react to economic studies aimed at showing how the banking system would function better without the Fed? Would they get funding? Would the professors guiding the research bite the hand that feeds them?
The concept of the profession instilled by these educators into their students will obviously contain the basic point that government is a good and necessary ally. The students would not be able to conceive of their professional role without government. This would go from Journalism through all the arts and to education itself. Needless to say, schools of government, international relations, economics and finance will all instill simillar attitudes.
People at the top of government are so deluded that they would play along with the actions we decry here daily believing that they are actually helping someone.
It's that simple.
The process is "natural" once it is started. The people who started it died long ago.
Looking through the news today,there seems no referendum being filed against the Swiss Gold sales .Today is the deadline.
According to Howes article,the Euro block has now secured their Gold loans.Fasten your seat belts.
Nice Eastern to all ! Grab all Golden eggs you can !
http://news.bbc.co.uk/hi/english/uk/newsid_717000/717511.stmAn elderly man was convicted of murder for shooting a couple of burglers in remote UK. The link leads to the story. And the Brits made gun ownership illegal, what barbarians! Hmmm.... At least the recidivism rate for one burgler just dropped to zero ;-)
REUTERS
Gold prices barely moved in early European trade yesterday, with equities markets settling and attracting investors back into stocks. Gold fixed at US$281.40 an ounce in the morning in London, against Tuesday afternoon's $281.10. Spot metal was at $281.25-$281.75, compared with the New York close at $280.75-$281.50 on Tuesday.
"Gold has given up the fight now that equities have settled down," one trader said. "It's seeing some good support from physical buying at these levels, but there's only so much that the physical buyers will want. So next time it tests $280 it will be weaker and demand will dry up soon, driving the price lower."
Analysts and dealers agreed that physical interest had slightly decreased and most buying interest had been moved lower in the $280 area. One trader said: "There's just no reason to buy gold - it has no underlying strength of its own."
Asian spot gold rose after physical buying but the price could falter as calm returned to equity markets, traders said. Spot gold finished in Hong Kong at US$281.20-$281.70 an ounce.
Source: Bridge NewsGold Meet: Homestake chief expects good recovery in gold price
Palm Springs, Calif.--Apr 18--Jack Thompson, chairman and chief executive officer of Homestake Mining Co., told Bridge News that he expected a good recovery in the gold price and anticipated a rise in price in late 2000. Speaking on the sidelines of the Gold and Silver Institute's annual meeting here, he said he is 'comfortable' with the $325-per-ounce gold price Homestake has used in its long-term calculations of reserves. (Story .12384)
Black Blade: Still some time to accumulate.
GOLD MEET: Salomon Smith Barney analyst sees gold at $320 in 2000
Palm Springs, Calif.--Apr 19--The gold price is forecast to climb to an average of $320 per ounce this year and $350 in 2001, said Salomon Smith Barney vice president of equity research John Hill. Speaking at the Gold and Silver Institute meeting here, he said that a commodity deficit is "tough to explain away," and noted that the downturn in the gold industry is sowing the seeds of a recovery spurred by fundamentals. (Story .12609)
Black Blade: Go figure! Eat your heart out Andy Smith and L. Kaplan!
WASHINGTON (AP) - The Treasury, its coffers filled because of budget surpluses, bought
back $2 billion of the national debt Thursday, the latest in a series of debt repurchases.
Because the outstanding 30-year Treasury bonds carry higher yields than the current market
yield on comparable securities, the Treasury Department paid sellers $431 million in
premiums to cash in early.
Treasury bought back 12 issues of 30-year bonds maturing between February 2020 and
August 2025. The bonds carried yields ranging from 6.250 percent to 8.750 percent.
Over the long run, the saving in interest payments will be more than the costs of buying
backing the bonds.
The new era of bulging government surpluses - helped along by a booming economy that is
generating lots of tax revenue - is making it possible for the Treasury to repurchase debt.
The Clinton administration is predicting a $166.69 billion surplus for fiscal 2000, while the
Congressional Budget Office sees a $179 billion surplus.
If a surplus materializes for fiscal year 2000, which ends Sept. 30, it would be the first time
the government reported three consecutive years of surplus since 1947, 1948 and 1949.
Treasury bought back the debt using a process known as a "reverse auction," in which the
government selects offers on a competitive basis based on the lowest prices. Offers must be
submitted in increments of $100,000.
On March 9, Treasury bought back $1 billion of the debt, the first time it has done so in 70
years. That was followed one week later with another $1 biloion repurchase. In the two
operations, Treasury paid sellers around $613 million in premiums to cash in their bonds
early.
The debt bought back thus far is a tiny fraction of the $5.7 trillion national debt. Of that total,
$3.6 trillion is held byf Public Debt site: http://www.publicdebt.treas.gov
Please someone -- Explain the strange COMEX happens !
The way that the Hobbits see it, is that there are no buyers on the COMEX for the June 00 contract, other than the low bidders willing to maintaining the bid $279 floor. Not too many sellers are willing to sell at the "floor" level either. There are "some" ask offers at prices much higher than the existing price bid range, offering to sell between the $290 to $305 range and at volumes of up to 50 contracts. BUT NO WANT-TO-BE BUYERS !!!! Trading volume is MINIMAL !!!!
EXPLAINATIONS PLEASE !!
<;-)
I think I heard about some news releases that stated that "there is no longer any reason to buy gold", the rest of the article implied that there is no reason for the gold to be valued so high.
It sounds simple enough to me that if the general public hears an announcement like this on anything, they will pull out of it faster than you can say "boo". Maybe that is something that happened?
I may have read this on this forum yesterday, I really don't remember.
That, and maybe as today is a pre-Easter holiday (Not much posting this morning either)and it's clear weather even in Seattle, and maybe everyone's getting tired of it all and are taking a break.
Euro being trashed again today taking gold with it. How anybody can believe the Euro will ever challenge the dollar in a serious way without profound changes in the European power structure is beyond me. Euro has plunged some 17% versus the greenback since it was first launched.
To be sure the Euro (like gold) is ovesold and probably due for a rally soon. But dethroning the dollar on the world stage? The very idea is absurd
The volume never seems to add up. If I look at the charts of the June COMEX contract using livecharts.com and display the volume, it is not even close to the volume published in the WSJ. Sometimes it looks like 1/10 the volume published. SO either there is very high volume in the out months or the volume stats are rigged to make the market appear liquid. Don_L over at another forum says the WSJ numbers are rigged.
(changes dateline; pvs. Tokyo; adds comment from Goldman, industry source)
NEW YORK, April 20 (Reuters) - Japan's Ministry of Finance on Thursday served notice it could drop U.S. investment bank Goldman Sachs (NYSE:GS - news) as a possible adviser in the country's next sale of government shares in top telecoms group NTT.
A senior official at the ministry said it wanted assurances Goldman's handling of a pervious, $2.9 billion share offering of Dutch Internet group World Online did not breach any laws before approving Goldman as an adviser for NTT.
``We are asking Goldman if it has not gone against the law regarding World Online,'' the official told Reuters.
The Financial Times reported on Thursday that the ministry may drop Goldman as a financial adviser on privatisations, particularly for the sale of another tranche in telecoms giant Nippon Telegraph and Telephone Corp .
The newspaper said the ministry was alarmed at how Goldman had managed some recent international share issues, particularly World Online.
But Goldman said the Japanese ministry had not taken any action against Goldman.
``The ministry of finance has taken no action against Goldman Sachs and there is no formal investigation of Goldman,'' Kathleen Baum, a Goldman spokeswoman in New York, said.
Goldman had no reason to believe it would not be allowed to participate in the offering, an industry source said.
The U.S. investment bank has been an aggressive player in Japan, ranking as one of the top deal makers in the country along with Merrill Lynch and Co. Inc. (NYSE:MER - news) and Morgan Stanley Dean Witter & Co. (NYSE:MWD - news).
It also has spent large sums in Asia over the last few years in long-term investments and partnerships with other companies. Currency turmoil pummeled markets across Asia at the end of 1998, but they since have begun to recover.
Goldman acted as one of the three global coordinators for a sale of NTT stock worth 835.9 billion yen ($8 billion) in 1998 and a fifth sale worth 1.56 trillion yen ($14.9 billion) in 1999.
The latest development comes after World Online founder and chairwoman Nina Brink sold most of her 9.5 percent stake before the offer. The transfer was included in the prospectus, but she did not spell it out to the media.
Brink resigned last Thursday. Goldman and joint adviser ABN Amro Rothschild are now facing compensation claims from some
World Online shareholders, who have seen the shares fall from a list price of 43 euros to 14.80 euros on Wednesday.
Goldman has said it acted properly in the flotation of World Online and would fight the damages claim.
The Japanese official said the ministry first asked Goldman last week for clarification on the issue, but it did not receive any report back from the investment bank, and instead was forced to rely on media reports on the World Online controversy.
Goldman had supplied information in response to questions the Japanese ministry had raised, an industry source said.
The ministry began questioning Goldman's potential role in the upcoming NTT share sale following an article last week in U.S. magazine BusinessWeek detailing problems in the World Online deal, the official said.
The official said the ministry routinely checks for legal problems involving past lead managers or members of a syndicate for NTT stock sales.
Any legal punishment would cause the ministry to drop them from a list of candidates for advising on the share, he said.
The Japanese government still owns 53 percent of the former telecom monopoly NTT and plans to reduce the stake to 33 percent eventually.
The ministry has not decided yet when or how much of NTT shares it will sell next. It says it will decide the timing and the amount according to market conditions.
I just wanted to remark on your post from Reuters about nobody wanting gold. Apparently they haven't looked at the large exports of Gold from the United States. Someone obviously wants Gold, just not the paper version.
Question for the Forum: If the European Central Bank is going to increase it's reserves, including Gold, then is it possible that the Swiss Gold will just be bought from them in a bank to bank transaction?
"THE GREEN PAPER PIG"--A Dream of the Future of the Dollar!
(Early this morning, June 23, 1973!) David awoke in the Spirit and related to me the following dream:) IT WAS SUMMER IN THE MIDEAST, and we were fleeing through this canyon or wadi where a stream flowed (I know now it was the Jordan River), towards some kind of sea or lake like the Dead Sea (which I know now it was) where we were to get on some boats to escape across to the other side. But then as a last resort, someone unleashed on us this big imaginary monster--a gigantic Green Pig--and he was huge, like a mechanical elephant or one of these mammoth monster-like parade balloons, and if you believed he existed he could destroy you! He was charging down the Jordan Valley, trampling on some people and devouring others, when I shouted at them: "He doesn't really exist! It's just in your mind! You must rebuke him and he'll go away!" So some of us turned as we were boarding the boats to leave, and just as he caught up with us I yelled again, "He doesn't exist! It's a matter of whether you believe it or not! It's only your faith in him that he exists that makes him real! Rebuke him in Jesus' name and he'll flee!"--And the minute we turned and faced him and challenged him and rebuked him in Jesus' name, he vanished just like that! (David snaps his fingers.) He was like the ultimate weapon, their last resort, to release this monstrous Green Pig!
AFTERWARD I WAS LYING HERE THINKING: "What is this funny dream! What does this strange dream mean, Lord?" I asked the Lord: "What is a green pig? That's ridiculous!" Then I thought to myself, "What is like a pig? Is it a nation? But what nation is like a pig? America? But why is he green? Does that mean he's young and new?" And then the answer came just as clear as anything: He's the American dollar!--The ultimate weapon in the Mideast is the American dollar, and if you believe in it, it will destroy you! But if you know it doesn't really exist, it vanishes! So I had told them, "It doesn't even exist! It's in your mind! It's your fear, your imagination! Resist it! Challenge it in Jesus' name!"--And, poof! It just evaporated! And that's the last I remember!
SO THE ULTIMATE WEAPON IS THE "GREENBACK" Pig!--The American dollar, or American "greenback," as they call it! Somehow they're using it against the rest of the world. It came charging down the Jordan Valley just like they'd turned him loose _________ (censored), and he came charging furiously at us, and was really trampling and devouring the stragglers, the people who were a little late in making up their minds. But when it got to where we were embarking in these boats, we just turned around and I screamed: "He doesn't even exist! Rebuke it in Jesus' name!"--And we all just turned around and resisted it in Jesus' name, and it vanished just like that!--The ultimate weapon! How about that?
WE MUST TELL THE WORLD THAT THEY MUST NOT FEAR THE AMERICAN DOLLAR! The Green pig is only a monster of the imagination! It only exists if you believe in it. If you resist it in the name of God, it evaporates and is no more! So he's very wise to put his money in gold, because the dollar is going to evaporate when the people lose faith in it, and it will be gone! The green pig gobbles everybody up that believes in it, and tramples everybody in the mud that thinks it exists! But for those who know it's just a monster of imagination, it vanishes!--It's nothing! The Green Pig is the American dollar!
I WAS TRYING TO FIGURE OUT WHERE ALL THIS WAS, and it came to me that the place where I saw the decision made to release the Green Pig was _____ (censored), and the small canyon with the river in the bottom was the Jordan! It had small low bluffs on both sides--it was the Jordan Valley, the Jordan canyon, and we were fleeing down from _____ (censored) to the Dead Sea where we were embarking on boats.--And it came to me we must have been going to Petra, fleeing to Petra, the world-famed Rock City in Jordan! But the decision to unleash the Green Pig, the ultimate weapon, was made at _____ (censored)!
SOMEONE IS MANIPULATING THE DOLLAR and using it as a weapon--the Green Pig--to try to destroy their enemies. Someone is behind the monetary crisis and they are using it to their own advantage to somehow try to destroy their enemies.--And if you believe in it, it will destroy you, but if you refuse to believe that it even exists, it completely evaporates and vanishes! It has no power over you at all. It is a monster of imagination! It only terrifies those who believe that it exists. It is the moneymakers' monster, and the Green Pig is just a tool in their hands.
AMERICA ITSELF IS LIKE A GREEN PIG, and the Green Pig is like America--huge and powerful and young and green and greedy, gluttonous, wasteful, selfish! But it only exists if you believe it exists, like its dollar, the "greenback," or the American dollar. It's like this Green Pig is the god of America, it is America's idol that they worship. It is not even as good as the golden calf, because it doesn't even exist! It is all in the imagination. But they worship it and they created it, and the moneymakers helped them to create it. But it is they that tell it which way to go. It is they who unleash it against their enemies, and it is they who control it, and they either harness it and support it, or they unleash it and send it charging against their enemies to devour them!
BUT IF YOU HAVE NO FAITH IN IT, and you take no stock in it, you don't believe in it, you don't worship it, and you rebuke it in the name of God, it just vanishes and evaporates! It has no power at all over you unless you're one of its worshippers. The moneymakers are its high priests and its priesthood, and it was created in their temples and they control it and they manipulate it as they will to their own advantage against their enemies.
SO YOU AND ALL THE WORLD MUST BEWARE OF THE DOLLAR! It is a moneymaker's creation--a Green Pig! It'll devour you and trample you to death in the mud and the mire if you believe in it and put your faith in it, if you trust in it! Because, whichever way it moves, it moves at their behest, at their direction, because they created it and they control it. But it only exists for those that believe in it. If you take no stock in it and have no faith in it and don't believe in it and you reject it, and if you refuse to accept it and you resist it because you know it doesn't exist, except according to men's faith in it and their imagination, if you challenge it in the name of God, it just goes pooof!--Like puff, the Magic Dragon! It totally evaporates! It has no power over you whatsoever if you don't believe in it. But those who believe in it will be destroyed by it!--It was their creation, their monster, and it is the figment of their imagination, but they use it to their own advantage. But if you'll reject it and refuse to believe in it, and you rebuke it in God's name, it vanishes and cannot even touch you!
THEY MUST NOT PUT THEIR FAITH IN THE DOLLAR. THEY MUST REBUKE THE GREEN PIG and he will vanish for he doesn't really exist except in the minds of men who accept him. You get all the words of David? You receive all the words of your Father? You must tell them to the people! "Beware of the Green Pig which the moneymakers have unleashed upon the world!" The money crisis, the dollar crisis is their creation and the decision to use it as the ultimate weapon was made at _____ (censored)! (He looks at grey sweater): It looks green, and I thought it was green! Then all of a sudden I realised it wasn't green!--It was all in my imagination! Like those that clothe themselves in dollars they think are green, they think they are alive and young and growing like the green things of the earth, but they shall find that this greenness only exists in their imagination, and when exposed to the light of day, the truth of God, it turns to grey ashes, burnt out fires, dead grey ashes!
THE AMERICAN DOLLARS ARE NO LONGER GREEN AND GROWING, BUT THEY HAVE TURNED TO GREY DEAD ASHES and they only look green if you're deceived thereby, only if you think that grey is green when green has really turned to grey! The Green Pig will turn to ashes, dead grey cold ashes, when the fire of faith is gone, and it will be burnt out and destroyed when the fire of the faith of men in it is gone! When the flame of faith in it has burnt out, all the dollars will be turned to ashes and burnt up, turned to worthless ashes! Oh my God, why don't they see that! Why does God's prophet have to tell them a simple little childish story? I have to warn the world, honey, of the words God gives, His wondrous words He gives to save them from this monstrous Green Pig--the American dollar they have unleashed on the world as their ultimate weapon to try to destroy their enemies!
AMERICA'S GREEN PAPER PIG DOESN'T EVEN EXIST--IT'S ONLY IN YOUR MIND--and only if you believe in it! It's a figment of your imagination! If it's your image, if it's the image of your nation--your image-nation, your imagination, the image of your nation, and you worship it and you believe in it and you hold on to it, it will destroy you! But if you rebuke it and defy it in the name of God, it has no power over you! It totally vanishes--just evaporates! As they unleashed it at ________ (censored) and it came charging down the Jordan Valley toward us while we were escaping in these boats at the Dead Sea, it was destroying everything in its path till we turned and rebuked it and resisted it and I shouted to them, "It doesn't exist! Rebuke it! Resist it and it will flee from you!"--And we did, and Puff, the Magic Dragon vanished!--Puff, the Magic Dragon crashed!
THE WEST IS THE STRONGHOLD OF THE MAGIC DRAGON--THE DREAM PIG! I'm not afraid of the Magic Dragon! I'm not afraid of the Green Pig! But we were leaving and embarking on boats across the Sea. If their faith in the Pig is very strong, then the Pig is very strong. It really exists for those who believe it exists. For those who worship it, it not only exists but it is their god, and it rules over them and controls them and devours them and destroys them, because they worship other gods and they worship the Green Pig--the ultimate abomination, the abomination of desolation which brings desolation and abomination to all who believe in it! The Green Pig is an abomination of desolation sacrificed on the sacred altar by its moneymakers!
BUT IT IS AN ABOMINATION TO GOD--the Green Pig, the American dollar! It is a pollution!--It is pollution! It pollutes the whole world worse than any other pollution, because it pollutes the hearts and minds of men and captures their bodies and destroys their souls and devours them and gobbles them up--the Green Pig! It is a marvel and powerful and wondrous and mighty to those who believe in it!--But it is nothing, it is not even weak to those who know it doesn't even exist!--It's nothing!--It evaporates into thin air! If you resist it and rebuke it, it will flee from you and vanish!
THE GREEN PIG--THE AMERICAN DOLLAR THAT DEVOURS AND DESTROYS SO MANY! It is controlled by the moneymakers! They released it against their enemies and the world, but we will help the world to resist it, to rebuke it and defy it and know that it doesn't exist except in the minds and imaginations of money men! If you know it doesn't exist, that the Green Pig, the American dollar, is a lie, a figment of the imagination and a creation of the money men, if you rebuke it, resist it and defy it and tell it it is a liar, it'll vanish and evaporate and have absolutely no power over you whatsoever! It just goes Puff, the Magic Dragon! Puff, the Magic Dragon is a pipe dream dreamed up by the money men!
WHAT DOES THE WORD "DOLLAR" MEAN? There was no such thing as the American dollar until it was dreamed up by Washington! What does it mean? There's something strange about that word dollar! The dollar has the whole world in the doldrums! The world, who's been beating the drums to the dollar, is now in the doldrums because of its false worship of its fallen idol, which is what they deserve! For they created to themselves idols of gold and idols of silver, and now their final idol is an idol of paper--a paper tiger!--Sickening, greedy, gluttonous, Green Pig, the dollar! You see?--Now you see it, and now you don't!--Depends on whether you believe it or not. The Green Pig--the moneymakers' joke!--The American dollar! What a joke on the world by the money jerks! They are going to jerk their joke out from under them--the German joke that comes from Joachim's dale, or thalle, a gorge with a river like the Jordan Valley! The obsolete German coin or thaller is going to become the obsolete American dollar!--Joachim's dollars, joke'em!
THE GREEN PIG--THE CREATION OF THE MONEY MEN! The worshippers of the dollar have been deceived by their own priests! They are now deceived and destroyed by their own creation! The deceivers are themselves deceived by their own deception in which they believed--the Green Pig--the American dollar! It shall return upon their own heads, and it shall turn upon them and rend them and trample them underfoot because they have cast their pearls unto the swine--and the truth unto dogs!--How they travestied to create their Green Pig, not even a golden calf! The laws of God have they cast down and broken! They have not even created a golden calf this time, but only a Green Paper Pig!
THE AMERICAN DOLLAR--A GREEN PAPER PIG WHICH WILL DEVOUR AND DESTROY YOU IF YOU LET IT and believe in it and accept it, but which will vanish and evaporate into the nothing that it is if you refuse it and rebuke it and don't believe in it, don't take it, don't accept the Green Pig, refuse the Green Pig, challenge it, defy it, rebuke it! He'll not only flee from you but he'll completely vanish, because he is not! He's a figment of men's imaginations: The Green Paper Pig! Hurry, honey, we have to get these words to the waiting world! We have to hurry! Honey, you won't forget about warning the world about the Green Pig, OK?
IN THOSE DREAMS NOTHING IS WITHOUT SIGNIFICANCE. I was praying about why the Green Pig was running down the Jordan Valley and caught up with us at the Dead Sea. It lost its power when it arrived at the Dead Sea and we confronted it. It was like the Dead Sea, lowest spot on Earth, symbolises the end.--The Green Pig could go no farther or lower, and there it vanished from the earth at our rebuke! The Jordan River is a living river and it gives life and flows and waters and feeds until it gets to the Dead Sea, and there those waters, like Lot's wife, turn to salt and become dead and can no longer go anywhere or do anything. They've stagnated. They've reached the end and they no longer seem good for anything--like the dollar, the Green Paper Pig! And the pig was following the course of the Jordan, which also symbolises crisis and death till he reached his end at the Dead Sea, and that's where we destroyed it by defying it and denouncing it and it couldn't stand exposure! The minute all the people looked at it and heard that it was only in their imagination, it just vanished! The minute they heard it was just an imaginary pig, it vanished!
WHEN A CURRENCY COMES TO ITS END AND BECOMES WORTHLESS, AS IN GERMANY AFTER WORLD WAR I, only things of real value, material things of actual usefulness and necessities, become negotiable, and a system of bartering or trading of goods instead of money arises. When the currency dies, men return to the age-old system of trading physical and material necessities. So that people trade things they have and produce for things that they need, such as the farmers would trade the foodstuff they produced for the tools and manufactured items they needed, and the industrial communities or tradesmen who make things would trade them for the farmers' food and the goods that they need.
SO THAT IN GERMANY, JUST BEFORE HITLER, THE MARK HAD BECOME SO WORTHLESS that the government was printing billion-Mark notes, which were still not worth much, and each city and town and area began printing its own currency, or spurious currency, in which each government tried to inspire the faith of the people as a medium of exchange, because it was a little difficult without it. If you wanted to go to the theatre you had to take so many eggs or a hen for admission! It was not only difficult for the customers, but imagine the problems of the management in trying to find a place to store all these things! One story is told of the two women who went shopping with a whole laundry basket full of German Marks, to show you how worthless the Marks were!--And as if that wasn't bad enough, when they weren't looking, somebody dumped all the Marks out of the basket, left the Marks on the sidewalk, and ran off with the basket!
SO WHEN THE DOLLAR, WHICH HAS IN EFFECT BEEN THE WORLD'S INTERNATIONAL CURRENCY, COMES TO ITS END, WHAT IS GOING TO BE THE MEDIUM OF EXCHANGE? Gold has kept its value very well, and in fact, in relation to the dollar, it is now worth about four times as much as it was back in the thirties! In other words, the dollar is worth only about one-fourth of what it was 40 years ago! It's been dropping nearly 20 percent in value every ten years or about 2 percent a year!
BUT WHAT IS GOLD GOOD FOR NOW in actual material necessities and how valuable is it today? For many ages gold has been much sought after as a useful, but particularly as a very decorative, metal, so it became an extremely precious metal sought by the rich for their tableware and their various metallic decorative materials, etc. But today it is not sought after so much for those old-fashioned luxuries, and is not even as much in demand for things like gold watches and jewelry. But it has become increasingly in demand as a vital part of the electronic systems of many of these new scientific gadgets!
THIS IS ONE OF THE REASONS WHY THE PRICE OF GOLD HAS GONE UP, because it is still very much in demand and extremely necessary for the circuitry of electronic devices. One reason that TV sets cost so much for example, or even your little transistorized radios, is because gold is used extensively in these, as it is one of the world's best conductors of electricity! Amazing isn't it, that God made gold so useful and necessary, from ancient times to the present, as well as beautiful and attractive! God has always put considerable value on gold in the Scriptures, some on silver, but mostly on gold. But He does say that there will even come a day when gold and silver will be less valuable and as common as the rocks in the streets, which may be the Millennium or thereafter because of the loss of the need of all these gadgets and scientific contraptions, as well as the loss of the need of a monetary standard, or metals for mere decoration. Nevertheless, gold has kept its value over all these centuries and really better than anything else outside of actual real estate.
ONE REASON FOR THE REAL ESTATE BOOM IS THAT WHEN PEOPLE BEGIN TO LOSE FAITH IN THEIR MONEY, currency and banking accounts, they begin exchanging their money for things of actual useful value. They can't help but see from history that the value of money is constantly going down, because these are no longer the secrets of the rich and high finance, but they are common knowledge of the general public and the man on the street. He knows that the value of his money is deteriorating every day through what is called inflation. As the prices go up, his wages never rise as fast as the prices since the owners, manipulators and managers of money are the ones who control both wages and prices. Therefore the rich always see to it that their prices rise faster than the wages of their wage slaves!
SO THE BIG AND POWERFUL LABOUR UNIONS NOW INSIST THAT TO EVERY NEW CONTRACT there be attached the proviso that their wages will automatically be raised according to the cost of living, which is known by the cost of living index.--Periodically the wages of the labourers of certain industries who have made these very wise contracts, will be raised by exactly the same percentage as the rise in the cost of living: Or in other words, according to the deflation of their money caused by the inflation in prices. So some labour has gotten pretty smart on this issue!
NEVERTHELESS, LABOUR NEVER SEEMS TO BE ABLE TO KEEP UP WITH THE COST OF LIVING no matter how hard they try. Because, if you're a manufacturing owner or manager or a money manipulator, it is much easier for you to manipulate your prices and money, most of which is simply done on paper, than it is for the poor lowly labourer to try to get a raise in his wages from the industrial managers and money manipulators who are in control of wealth and the sources of wealth and power and the sources of power and government and are usually much richer, more powerful, better educated and smarter than the poor average working man.
BUT LATELY, EVEN THE MONEY MANIPULATORS HAVE BEEN LETTING THINGS GET A LITTLE OUT OF HAND and out of their control, and they haven't seemed to quite understand why their money matters are getting in such a bad way because of the sudden fall of their god the dollar upon which they base their values and currencies and their rates of exchange even from one currency to another in foreign countries throughout the world. When you go to a bank to exchange one foreign currency for another, you will usually find that on the little exchange slip or receipt they give you as a record of the transaction, first is listed the amount and the kind of currency which you gave them, then its value in dollars, believe it or not, and then finally its value in the local currency for which you are exchanging it!
SO THE GOD DOLLAR--THE GREEN PIG--HAS BEEN THE WORLD-WIDE STANDARD OF VALUE and of monetary exchange since most of the world went off the gold standard, and, subsequently, the silver standard! In other words, the U.S. got so strong and so smart and rich and powerful that even after it was no longer willing to give you either gold or silver in exchange for your paper dollars, the value and power of that paper dollar held its value and power of exchange in the minds of the people by their faith in the American government and its people and its power! So that the dollar held its own for a long time after its actual value in gold or silver was gone!
IT HAS TAKEN THE WORLD 40 YEARS (amateur's comment: by now almost 70 years!) AND A LOSS OF CONFIDENCE IN AMERICA and its government to finally wake the world to the fact that the dollar is actually worth very little, if anything, and it is only worth to them as much as their faith says it is worth! And since they've lost faith in the American government, they are no longer willing to believe what it is worth, what America says it is worth. The dollar has been coasting along on its own momentum for several decades due to the power and wealth of America and the world's faith in the American government and its word that the dollar was worth something. But now that the world is beginning to awaken to the fact that it was only by faith that the dollar was worth anything, they've lost that faith in America and its word, and the doll Swiss Gol ��p
Sorry about this posting being so long... but it is very much on topic and as it is Easter you probably wouldn't have much better things to do anyway! Ha!
Anyway here is the last part of the classic letter: "The Green Paper Pig" written almost 27 years ago by Father David.
IT HAS TAKEN THE WORLD 40 YEARS (amateur's comment: by now almost 70 years!) AND A LOSS OF CONFIDENCE IN AMERICA and its government to finally wake the world to the fact that the dollar is actually worth very little, if anything, and it is only worth to them as much as their faith says it is worth! And since they've lost faith in the American government, they are no longer willing to believe what it is worth, what America says it is worth. The dollar has been coasting along on its own momentum for several decades due to the power and wealth of America and the world's faith in the American government and its word that the dollar was worth something. But now that the world is beginning to awaken to the fact that it was only by faith that the dollar was worth anything, they've lost that faith in America and its word, and the dollar has lost its value.
TO GIVE YOU A LITERAL ILLUSTRATION OF HOW THIS HAPPENS: A recent plunge in the value of the dollar was caused by the world's loss of faith in the Nixon Administration and its veracity and credibility because of its many lies, deceits, political intrigue and cover-ups. So, as the world lost faith in America's Nixon Administration, it also lost faith in America's money! Because, since faith in money is based on faith in the government that produces that money, and in that government's word that says it is worth so much, then the people no longer believe either in that government nor its word nor its money when they lose faith in it!
THEREFORE, THE MONEY LOSES ITS BELIEVED ACTUAL OR SUPPOSED INTRINSIC VALUE and its professed and recognised value as a medium of exchange at its former rate of exchange in almost exact proportion to the people's loss of faith in it! In other words, paper money is only worth what people believe it is worth! They have to have faith in it, believe in it and be willing to accept it as a valuable and negotiable medium of exchange. Otherwise, when they lose faith in the money, it immediately loses its value and becomes worthless! If the people believe it is worth nothing, it becomes worth nothing! Because paper money and currency to begin with are created by governments, the powers that be, to furnish the people with a convenient form of trading values or as a medium of exchange, instead of actually having to exchange products, goods or services.
FOR EXAMPLE: Say the price of a goose is considered so much in the currency of the land, and the price of a watch is considered so much in the same currency of the same land. But, instead of having to bring so many geese to the jeweller in exchange for a watch, or vice versa, you simply each of you put your faith in the medium of exchange or money and what the market and the money men and the government say the goods are worth in relation to the money or what the geese or a watch is worth according to the economic laws of supply and demand. So instead of trading so many geese for the watch or the watch for so many geese, you take the geese to market and you sell them to the butcher for what he says they're worth in money and what you are willing to accept as their value in money. Then you take that money over to the watch-maker and you trade that money to him for the watch, which is a lot easier than carrying a bunch of geese to him, since most jewellers don't have pens to keep geese or that much use for that many geese! So you simply trade him the money for the watch at the price he says it is worth and what you're willing to pay for it.
SO THAT MONEY IS MERELY A MEDIUM OF SIMPLIFIED EXCHANGE OF GOODS BETWEEN PRODUCERS AND CONSUMERS. Though the paper currency has no actual value in itself any more than the paper it is printed on, it has value according to what the people are willing to believe it is worth in this form of monetary exchange which the various governments of the world have built up, particularly in modern times. In ancient times, the medium of exchange was almost always precious metals such as gold, silver, nickel, brass or copper, etc., mined and minted into coins by the various governments, with the imprint of those governments and their rulers and the designation of the coin's value according to what the government said it was worth.
AS A GOVERNMENT BECAME MORE AND MORE DECADENT AND CORRUPT AND DISHONEST, ITS MONEY BECAME MORE DISHONEST, until the people found that the coins were no longer being made of pure gold and silver but filled with other less valuable metals: The gold coins became more brass and copper than gold, and the silver coins became more nickel, zinc or lead, etc. In recent history America was even making pennies out of aluminum when copper was scarce.--And of course paper coinage is quite a modern invention in fairly recent history, which came in with the invention of paper and printing press.
SO THAT PAPER MONEY IS A FAIRLY NEW THING IN WORLD HISTORY, which our clever capitalistic governments quickly latched on to as a much more convenient means of exchange than actual metal coins, and a far easier and cheaper way to manufacture worthless money and cheat the people! The people were then persuaded to accept these paper bills, or dollars, or pounds, or marks or what have you, because they were far more convenient to carry around, of course, than lugging around bags of gold or silver or copper coins! As long as the people were told by the government that the government would be ready and willing to exchange the paper thing for the real thing at any time they desired to do so, or, in other words, the paper currency for its printed designated worth in actual gold or silver coinage, real value, the people were persuaded to accept this paper substitute for the actually valuable metal coins.
BUT OF COURSE, THIS ALSO MADE IT VERY CONVENIENT FOR GOVERNMENTS TO MANIPULATE or change the value of their exchange to their own advantage, which usually means the advantage of the rich and the powerful. As modern governments also became more corrupt, decadent and deceitful, they too began to pollute their paper money and actually devalue it by being no longer willing to exchange it for either gold or silver, or anything else of actual value for that matter.
NEVERTHELESS, FOR THE PAST FEW YEARS THE WORLD HAS CONTINUED TO DRIFT DREAMILY ALONG, still believing in the power and value of the American dollar, supposedly backed by the power, worth and word of the American government. So that, since America went off both the gold and silver standard and no longer has to exchange either for her dollars, the world has continued to drift dreamily along on pure faith in the paper tiger of America, the Green Paper Pig, the dollar, and that it's worth what its government says it is worth! When actually the dollar is really worthless and without any intrinsic value whatsoever with no backing or redeemability in coinage of actual value such as gold and silver!
BUT AS THE WORLD BEGAN TO WAKE UP TO WHAT IS GOING ON, THE DOLLAR BEGAN GOING DOWN! It had continued to coast on for quite a while on its original monetary value momentum implanted in the minds of men by memory. But those memories are beginning to fade, and the minds are beginning to wake up, and the men are beginning to lose faith in the once almighty dollar, the god of America and the world! For a long time it continued to coast along, not only because it was considered worth what the Americans said it was worth, but because other governments of the world were also willing to support it with their word, saying that it was worth so much to them also in their own currencies. But now other governments too are losing faith in America and America's money because they're losing faith in Americans and American administrations, so that other governments of the world are no longer willing to support the dollar and say it is worth so much in their money and give you as much of their money in exchange for it as they used to.
SO AS WORLD FAITH IN THE DOLLAR WANES, SO WANES THE DOLLAR, and it is sinking lower and lower day by day!--Since its actual paper value is really worth nothing, and it is actually only worth what Americans or others are willing to give you for it in the way of actual material goods. But if the Americans themselves should lose faith in their dollar, as they shall, then they will no longer be willing to exchange valuable goods and services for worthless paper dollars, either between each other or other members of the world community!
THIS HAS HAPPENED BEFORE TO OTHER COUNTRIES OF THE WORLD after the collapse of their governments, so that their people had to take a wheelbarrow-full of Chinese yen to market to buy a few groceries, or a basketful of German marks to exchange for a few loaves of bread! When the paper money, the paper tiger, lost its power over the minds of men and they lost their faith in its value as a mere medium of monetary exchange, its value went down to the nothing from whence it came, because it was worth nothing in the first place, no more than the paper on which it was printed! It was only made to be thought worth something by the faith of man, but now man is fast losing faith in his former paper god!
IF YOU THINK THAT PAST GENERATIONS AND CULTURES WERE FOOLISH for worshipping gods of gold and silver and wood and stone, give a second thought to modern man who has been worshipping gods made only of paper, and very thin paper at that, for a good many years now! But he's now beginning to lose faith in his paper gods, these worthless currencies, and they're beginning to fall! They'll soon be worth so little they'll be cast away as worthless, and only things, services, goods, products and materials of actual value and usefulness will be considered of any worth: The things and materials or products which the consumers of the world either need or want or are willing to pay for in other needed and wanted goods of actual value and use and worth and not merely spots of ink on pieces of paper!
ACCORDING TO MY DREAM, SOME PEOPLE HAVE LET LOOSE THIS MONSTROUS GREEN PIG of the paper greenback, as the dollar is called in America, or the Green Paper Pig, as God portrayed it to me, resembling a monstrous green papier-m�ch� pig similar to those old big fat piggy banks we used to have! What a fitting picture of the American dollar!--Like its American makers: --Big fat pigs overstuffed with green paper money!
SO THE PEOPLE WHO TURNED THIS GREEN PAPER MONSTER LOOSE ON THE AMERICAN PUBLIC and the peoples of the world, seeking to devour and destroy us to their own advantage by means of their Green Paper Pig, these Paper Pig producers and manipulators of pecuniary Paper Pig power, according to my dream, are going to be very soon dumbfounded and dismayed when the people of the world turn upon the Paper Pig and say, "Boo!" to its face!--"I don't believe in you anymore, so you don't even exist!"--And suddenly the Green Paper Pig power will vanish on the spot, and those dollars will be worthless, because they're only built on the faith of the people who believe in the Pig!
WHEN THE PEOPLE'S FAITH IS GONE, THE GREEN PAPER PIG WILL VANISH WITH IT, as they challenge its power and refuse to believe in its value and reject its worth and even deny its very existence! Because it is a purely imaginary monster--nothing but a Green Paper Pig--which will disappear without an "oink" when the day comes that you lose faith in it and you question, challenge and defy the phoney paper power of the Green Paper Pig, the once--almighty American dollar!--And the American greenback will vanish from the world scene like the Green Paper Pig in my dream!
BUT WHAT IS GOING TO TAKE ITS PLACE?--What will replace this Green Paper Pig which has so long been the recent world's means of monetary exchange, and upon which their own currency systems have been based? Right now certain currencies are going up while the dollar is going down in relation to those currencies. But what if these other governments also betray their people and the world by refusing to redeem their paper money in so-called hard currency or valuable silver and gold, the price of which is going up daily and is now four times what it was 40 years ago! What will the people of the world do then?
THEY WILL NOT ONLY DUMP THE DOLLAR, BUT THEY WILL ALSO DUMP THEIR OWN PAPER PIGS as well, and their governments with them, as they lose faith in both the paper words and the paper-tiger governments which speak them! The peoples of the world will then have to turn to some other gods and governments in which to put their faith, and the only acceptable values will be actual material things, goods and services. At such a time, the valuable salts, minerals, phosphates, bromides and other chemicals of the Dead Sea, where the Green Paper Pig was finally challenged and vanished in the heart of the explosive Mideast--those chemicals of the Dead Sea alone will be worth more than all the money in all the banks in all the world! They are extremely useful and valuable for making many useful and needed things such as fertilisers, gasoline, medicine, etc., as well as dangerous things such as explosives!
THE POWERS THAT BE WHICH CAN CONTROL THE VALUABLE, NEEDED AND WANTED MATERIALS of the world such as these and the oil of the Arab world and foods and necessities--such governments will wield the powers of the world, not in worthless Green Paper Pig money, but in actual raw materials, foodstuffs, etc., Those governments which can control the actual goods, and can deliver the goods, are going to get the government of the world! The time will come when money is no longer used as a medium of exchange, and the power of the Green Paper Pig will vanish, and the people of the world will be ruled by a one-world government who will control them by the material power it wields and its control of goods and services, actual material values, and not a Green paper-tiger Pig! The Arabs will have their oil, the Jews the Dead Sea, and the Americans a dead Green Paper Pig!
THE APPORTIONMENT CONTROL AND SHARING OF THESE NECESSARY AND WANTED GOODS and services will be managed no longer by the Green Paper Pig and those who monkey with our money! The money medium of exchange will be replaced by a very remarkable credit system in which every person in the world who belongs to the system will bare a credit number, without which he can neither buy nor sell, and by which he is accredited in his governmental account with the value of whatever goods or services he produces, and to which he can charge the goods and services that he himself needs. (amateur's comment: It looks like we perhaps might experience an interim period where the Euro replaces the dollar and further unites Europe, before this final credit system falls in place.)
SO HE WILL NO LONGER BUY NOR SELL WITH MONEY AS A MEANS OF EXCHANGE, BUT WITH A NUMBER, a number which will be given him permanently, without any possibility of counterfeit, change, or manipulation nor forgery, because it will be branded on each person: "a mark in their right hand or in their foreheads, that no man might buy or sell save he that had the mark or the name of the Beast (the world leader and his government) or the number of his name ... for it is the number of a man!"--And every man will have his own number, every member of the world System will be branded or tattooed with the mark of this final bestial anti-God world government.--They will no longer fear the Green Paper Pigs of past paper tigers and their owners, but they will have a new god and be branded by the Beast like cattle for the slaughter, and will be forced to worship the Beast and his image or be killed!
SO SAYS THE WORD OF GOD IN THE BIBLE IN THE THIRTEENTH CHAPTER OF THE BOOK OF REVELATION, as well as in many other descriptions of this final world government in the Book! Those who refuse to worship the Beast or accept his mark or number will be neither able to buy nor to sell, so we who worship God will starve, suffer, be persecuted, and even slain! But our faith in God will save us, and after three-and-a-half years of this awful time of the Great Tribulation under the Beast's new economic and religious system, Christ will come and rescue us and destroy the Antichrist government of the world and set up His own Kingdom here on Earth, where the real values will no longer be temporal, but eternal ones: Truth, love, joy and peace, in a world without money and without marks, and without the bestial governments, wars, cruelty and lies of man, but with truth and love and peace and plenty for all! Farewell to all you paper tigers--and especially that ridiculous Green Paper Pig! Instead, we will ride the pure white horses of the power and plenty of the Kingdom of God! Hallelujah! Amen?
Meanwhile, beware of the Green Paper Pig!
--What god do you worship?
Looks as if the Hobbits will just have to buy one of those cheap COMEX Gold Pit Seats to find out just what is really happening !! Where is Mr. Insider when one needs him ???
<;-)
Refer the yesterday's post (4/19) Msg 29035 for the link and a very plausible answer from Mr. Howe to your question. His idea is that Swiss sales are covering Euro Area banks leased gold and Dutch and Austrian sales are covering Swiss leased gold.
To lamprey_65, who wondered in (4/19/2000; 20:33:47MDT - Msg ID:29062) about a Hidden U.S. Stash of Gold. Perhaps I've grown too old and cynical by this stage, but I feel confident that the original source of this story is either not in possession of all the facts himself or, more likely, he is actively attempting to spread a false rumour.
Does the military/governmental complex of the U.S. have secret stashes of every strategic resource you could name? I should certainly hope so. Cobalt, titanium, palladium, basically any material necessary for the manufacture and maintenance of military hardware, is guaranteed to be kept in quantities sufficient to sustain a long campaign. Nearly sixty years ago, the choking off of Nazi Germany's imports (oil in particular) proved instrumental to our winning that war. Neither your nation nor mine have forgotten that.
Speaking of oil, I must admit laughing at the incessant cries last month from the American masses that the U.S. strategic oil reserve be tapped so that motorists could be spared a minor uptick in the price of petrol. That's not what the reserve is there for. The U.S. military doesn't stock enough petrochemicals to keep the general economy going, nor would it want to. If I recall the details of what passes for news these days, were the strategic reserve to be distributed among the sheeple, it would be exhausted in 50-some days. Since your military represents a tiny fraction of your population, and only a slightly larger fraction of your planes, trains and automobiles, that means the strategic reserve can keep the U.S. military itself going for months to years if necessary in the event external supplies are denied them. And that's the only reason that stockpile exists. They're not about to let whining motorists waste it.
The same rationale goes for the stash the U.S. military must surely have of palladium or platinum. They might well have enough palladium to drive the price to $50 per ounce if they dumped it in one shot, but you may sleep like a babe in the confidence that they'll not let go of that metal any more rapidly than one catalytic converter at a time, and that only once they're no longer able to spend tax dollars to purchase converters from civilian sources. Militaries aren't in the business of making profits. Recent wars have been ridiculous mismatches wherein the victor waltzed away having spent comparatively little in either lives or materials. But someday there may be another old-style war. As I mentioned some time ago, George Washington didn't win because he was a genius, but because he was stubborn and miserly. He outlasted the opposition, at great cost to himself, his army, and his nation. But he won. And that hasn't been forgotten.
But now let's get onto this gold stash notion. Why would a modern general stash gold? Frankly, he wouldn't. Oh, as an individual he might (an impressive amount of continental gold found its way to America after V-E Day, I should point out), but as a part of his day job, what possible military application is there for gold? His troops can't eat it, and most of them wouldn't value it if it were handed to them today. Electrical contacts, rust-proof plating, perhaps a few other exotic uses, but all of them well-satisfied across the entire military infrastructure by a paltry amount of the physical metal. Prior to the digital camera era, the United States Navy was credited with being the largest recycler of silver because they took the largest number of photographs and remanufactured their own film. But again, what military or even industrial use does Gold have that would warrant the stashing of a second Fort Knox? None at all.
Now, is all of the U.S.'s official gold physically located at Fort Knox? I very much doubt it. I'd be surprised if even a majority of it is there nowadays. When the facility was first built, what safer place could be imagined than the centre of a fort which was already swarming with tanks? But as the Cold War made clear, fixed co-ordinates can be irradiated. Given the aforementioned motivation to build underground arsenals such as Mount Weather, it would seem quite natural that, at some point in the 50s or 60s, a large portion of Fort Knox's stash was moved elsewhere. But it's still officially on account. They simply didn't want to let some Goldfinger want-to-be make it valueless with even a portable nuke.
In more recent decades, the business world has more than taken centre stage. I'm sure a significant amount of the U.S. gold reserve is in the basement vaults of the New York Fed, alongside the official gold reserves of a hundred or so other countries. When your government "seized the assets" of Iran in 1979, what exactly did you think was seized? Stock certificates? Titles to roadside hotels? No, what was seized was, in the main, the Shah's gold horde, safely kept out of the clutches of the revolutionaries and now gathering dust beneath Manhattan.
Which all leads back to the military. With that much gold lying on North American soil, why horde more? Even if there were some viable military use for gold, there'd be no military need to maintain a separate horde so long as, when push came to shove, the tank commander at Fort Knox had the authority to shoo away the New York banker who came to collect.
And there Is no reason for the military to want it. Jules Verne's Captain Nemo had scavenged from shipwrecks enough gold to make him a king, but to him its highest best use was as ballast for the Nautilus. As hollow and wrong as that mindset seems to readers here, most humans alive today regard gold as lovely lead, be they sheeple or generals. When that mindset changes (and it will someday, as surely as another earthquake will someday rock California), the only stashes of gold will be in the hands of the few remaining goldbugs like us. And, since you probably don't own many of your own tanks, it would be advisable for you Not to publicise where your own personal Fort Knox is located.
Which, I suspect, provides an answer to your question, Michael. I very much appreciate the offer of the login, but so long as you don't mind the email approach, I find the present arrangement more personally comforting. Thank you.
Yours,
I.V. Holtzman
PS: To Solomon Weaver, who in (04/14/00; 19:45:29MDT - Msg ID:28672) recommended visiting http://www.theonion.com/onion3613/wdyt_3613.html Thank you, Solomon, the "Could I have a different question that I even remotely relate to?" quote is one of the funniest lines I've read in ages! Though no doubt intended solely for amusement, I've seldom seen a single page so perfectly sum up a bubble waiting to burst. Excellent find!
SteveH, Black Blade--the best laid plans of mice and politicians
Sorry--came as E-mail---no linkThought you might be interested in an E-mail I just received from an associate in New Zealand. He apparently snipped from their newspaper.
"It now has been 12 months since gun owners in Australia were forced to surrender 640,381 personal firearms to be destroyed, a program costing the government more than 500 million dollars.
And now the resultrs are in: Australia-wide, homicides are up 3.2 per-cent; Australia-side, assaults are up 8.5 percent; Australia-wide, armed robberies are up 44 percent (yes, 44 percent). In the state of Victoria, homicides with firearms are up 300 percent.
Figures over the previous 25 years showing a steady decrease in armed robbery with firearms changed drastically in the past 12 months. There has been a dramatic increase in break-ins and assaults of the elderly. Australian politicians are on the spot and at a loss to explain how no improvement in "safety" has been observed after such monumental effort and expense was successfully expended in "ridding society of guns."
To Steve H ! Here is a U.S. Congressman that echos your words.
http://www.house.gov/paul/tst/tst2000/tst042400.htmSome strong words by Congressman Ron Paul concerning The U.S. Constitution and gun control:
Excerpt:
In countries that have recently undergone gun confiscations, violent crimes have skyrocketed. Click URL for full story.
....beesting.
Whether the US has a stash of gold or not, Idont know and I really dont care.
However I can understand why the US millitary might have such a stash.
Imagine your country has been ravaged by war, your currency is worthless and the only acceptable currency would be gold.
Take the case of Iraq. Oil and gold are the only currencies another country will accept.
During WW2, Germany could not use its currency to buy its imported raw materials, it was able to use gold.
It therefore makes sense to me that the millitary would want and very well need a stash of gold
Do not be deceived. It seems like were living in the endless summer,but, Fiat monetary collapses are always the Mother of War and Revolution.
The only thing to doubt is that ones vision of how this is going to unfold is not as bad as it actually is going to be.
Gold in the 270's is dirt cheap. At any given day, an event could transpire thats going to set off a chain reaction to perdition.
When the Fear ascends the arguement of whether gold is an investment or not is quickly going to turn to an issue of survival.
Get the cheap gold NOW. Even if its only a tenth ounce. You did what you could. The day after the once in a lifetime event sets off the chain reaction will be too late.
Is it possible that the US is planning on a devaluation of the dollar as soon as the inflation starts skyrocketing? I have heard that new bank notes already exists and are ready to roll.
Would this save their bacon? What if they at the same time went back to gold backing? Would that do the trick? Would this change the picture of the future that is being painted here on the forum? I am mainly here to learn!
What if I had a large debt in old dollars and they then usher in the new dollars, would I stand to gain?
ALL: Treasury statistics needed...===========================================================
...
Thursday's PATSY Report
4-20-2000
To: ALL
The nightly PATSY Index shows the relative
amount that GoldBugs have been conipulated.
XAU=55.71 + POG=278.40 + POS=4.96
-equals-
339.07
Down - 2.01 from Wednesday. Distortions into the holiday.
Traders often "reverse" their positions prior to holidays
and weekends. So the markets do the oposite of what they
should have done. Except PM's. They just always go down.
Gold knows no holiday. It's Relentless. Focused...
... Bof' us.?.
Comment: Here's a challenge to you all: What
would be the "price" of Gold, if one were to
divide the USA's total Currency in Circulation,
by the quantity of Gold officially owned by the
US Government.?. Would that be a more sane figure
than what we see in these fake markets each day.?.
And yes, yes, I know our currency is *not* linked in
any way whatsoever to Gold. But what if..IF..it was.?.
And on a 1:1 basis... Food for thought. And food for
me to write about. ... Later.
Does anyone know where, or have links to those
official statistics for each day.?. If so, I can
add that meaningful calculation to each night's
PATSY report. Please post the links. Thanx in advance.
Prediction: More (or less) of the same, pending the
holiday weekend and the topsy-turvy trade-positioning
which that always entails. Just ignore it all until
about next Tuesday.
ThaiGold...
Got Some.?. ... Get Some.!.
===========================================================
http://www.gold-eagle.comOn April 20, 2000, at 14:29, anchor posted on the gold-eagle forum: "gold stocks are a great story but still the most certain way to lose money this site (gold-eagle) is great reading but its recommendations lose thousands"
Indeed, true. I have lost thousands too, by buying some of the stocks that are being pushed in the said site.
Oswald
It doesn't seem likely that the US would ever devalue the
US$dollar if inflation should skyrocket. Because they won't
ever admit that it has skyrocketed nor even exists at all.
Their fakery in adjusting and manipulating the CPI index
proves that well enough.
There have often been rumors as you mentioned, of new US$
currency having been printed for various scenarios. Most
such rumors allude to drug-traffic-money-laundering etc to
replace zillions of dirty US$100 bills with new-colored
dirty US$100 bills to somehow thwart the trafficers. That's
all hogwash too. Just ask anyone, at the highest levels of
government, who are in-charge of the drug trafficking. There
is no-way they would make such an effor to thwart it.
Perhaps the rumor you heard, relates to the newest batch of
US$100 bills. They have *not* been printed yet. But will be
soon, when the Price of Gold is driven down to their goal.
At that time, they intend to print them on GoldLeaf, instead
of costly linen paper.
So, I guess you have answered your own question: That type
of Gold backing, with the correct glue, would do the trick.
Or be a trick. Probably both. Caveat Emptor. Insist upon
Real paper US$ notes in all of your future transactions.
Regarding the repayment of Old US$ debts using New US$ bills
is problematic. Would anyone (wage earners etc) have any of
them left, of either kind, to make their mortgage payments.
Or would any of the Banks still be in business, to accept
thier monthly installments. It's very unlikely. So do not
worry about that. Banks that remained open, would probably
insist upon repayment in the form of Old US$ bills. And they
would be readily available for you to purchase, at their
Currency-Exchange-Window, to your left. At their usual fee.
Mexico devalues it's currency frequently, so we might learn
from them, how they do it: For one thing, most banks there
do not extend credit to Joe SixCervaza. Nope. Houses there
must be paid-for upfront. In cash. Which is no problemo for
any of their government officials, police, bureaucrats, or
drug trafficers. Just ask anyone of them, who are your
neighbors, if you live in a Mexican well-to-do area, like I
did once.
One of my neighbors was the town's Mayor. One day, his son
came over to ask me for advice about which computer to buy.
He was on his way to the USA to purchase one. Being the son
of a connected bureaucrat, he already had the necessary and
coveted Border-Crosser Green Card issued to him. When I
asked him how much he planned to spend on a new computer,
(about US$1500 he said), and then asked him where or how he
planned to convert his Peso's into US$... he just reached
down into his pocket, saying: "Mom's taken it out of our
savings already", ... he pulled out five Kruggarands and
showing them to me, then asked me if I thought they would
be enough.
So, to answer your question, perhaps this helps. The Mexico
people know how to deal with devaluations. Asians too. And
now you know, as well.
I have been asked to comment on an article (apparently from a briefing service only affordable by top corporations) which, in a nutshell, indicates the following:-
The IMF figures for gold holdings reflect the gold of the European Monetary Institute value as $26.833 mill which at the end of 97 reduce to nil. Only $6,700 mill are transferred to its successor the ECB. Correspondingly the German holdings increase from their average dollar value over the 93-97 period of $8.880 mill to $31.203 mill � close to the approx $20,000 mill of the "missing" EMI reserves.
The physical quantity of the Bundesbank holdings seem to increase from 95.18 mill ounces to 118.98 ounces in December 98. (The quantities of gold and $ values do not seem to tally to this novice.) The article further states that the German foreign currency holdings are depleted by $7,711 mill last quarter 98 and a further $11,052 mill first quarter 99 indicating that this was used to pay for the extra gold holdings. This figure roughly tallies with the $20.000 mill above.
There are further facts and details covering levels of disclosure before and after monetary union but the above is the substance.
The article then refers to a response of Dr Hans Tietmeyer at a meeting in London some years ago where he was asked directly is Germany taking precautions against a possible failure in the collective currency. These precautions include the printing of new DM notes stored in the Hartz mountains. Instead of dismissing the question Tietmeyer replied directly that it was perfectly possible that such precautions had been or would be taken.
The article then argues that if the progressive collapse in the Euro ceased to be acceptable to Germany it could launch the new DM unilaterally leaving the rest of Europe with little choice but to accept new DM in place of the degraded Euro. There are some further interesting aspects but the article concludes that the Dollar will be dethroned not by the Euro but by the new DM. It further speculates that Russia will endeavor to be brought in as Germanys partner.
What do the experts think? Are the figures correct? Is there a third force in the Euro v dollar/yen currency wars the new DM? (A horn as it were hiding among ten horns which, when they are broken off, becomes a powerful horn?)
Aristotle thank you for graciously commenting on my post to Oldgold � it encourages frozen lurkers to come in from the cold nearer the fire if one of the stalwarts acknowledges a contribution. I'm also still chortling away with your 28948 � "those who are throwing themselves on the spears of bad investments" while I treat myself for the odd spear wound. Good one.
Also to Ph in LA and the rest who responded to Oldgold simply superb writing that adds luster to this fair forum.
I have been asked to comment on an article (apparently from a briefing service only affordable by top corporations) which, in a nutshell, indicates the following:-
The IMF figures for gold holdings reflect the gold of the European Monetary Institute value as $26.833 mill which at the end of 97 reduce to nil. Only $6,700 mill are transferred to its successor the ECB. Correspondingly the German holdings increase from their average dollar value over the 93-97 period of $8.880 mill to $31.203 mill � close to the approx $20,000 mill of the "missing" EMI reserves.
The physical quantity of the Bundesbank holdings seem to increase from 95.18 mill ounces to 118.98 ounces in December 98. (The quantities of gold and $ values do not seem to tally to this novice.) The article further states that the German foreign currency holdings are depleted by $7,711 mill last quarter 98 and a further $11,052 mill first quarter 99 indicating that this was used to pay for the extra gold holdings. This figure roughly tallies with the $20.000 mill above.
There are further facts and details covering levels of disclosure before and after monetary union but the above is the substance.
The article then refers to a response of Dr Hans Tietmeyer at a meeting in London some years ago where he was asked directly is Germany taking precautions against a possible failure in the collective currency. These precautions include the printing of new DM notes stored in the Hartz mountains. Instead of dismissing the question Tietmeyer replied directly that it was perfectly possible that such precautions had been or would be taken.
The article then argues that if the progressive collapse in the Euro ceased to be acceptable to Germany it could launch the new DM unilaterally leaving the rest of Europe with little choice but to accept new DM in place of the degraded Euro. There are some further interesting aspects but the article concludes that the Dollar will be dethroned not by the Euro but by the new DM. It further speculates that Russia will endeavor to be brought in as Germanys partner.
What do the experts think? Are the figures correct? Is there a third force in the Euro v dollar/yen currency wars the new DM? (A horn as it were hiding among ten horns which, when they are broken off, becomes a powerful horn?)
Aristotle thank you for graciously commenting on my post to Oldgold � it gives frozen lurkers courage to draw nearer the fire if one of the stalwarts acknowledges a contribution. I'm also till chortling away with your 28948 � "those who are throwing themselves on the spears of bad investments." while I treat myself for the odd spear wound. Good one.
Also to Ph in LA and the rest who responded to Oldgold simply superb writing that adds luster to this fair forum.
Source: Bridge newsMoscow--Apr 20--Russia's largest platinum group metals producer Norilsk Nickel has resumed platinum exports, Norilsk spokesman Anatoly Komrakov said Thursday. He said Norilsk was able to do this after Russia's sole PGM exporter Almazyuvelir export had obtained the necessary export license. (Story .19675)
Black Blade: Oh really? We shall see. Maybe had to shake down some Russian Mafia types or use slave labor. We'll shall see. Heard this same old tired line before.
Canada's Placer not ruling out further gold hedging in future
Toronto--Apr 20--Jay Taylor, the president and CEO of Canada's Placer Dome Inc., on Thursday told Bridge News that the company's plan to suspend its future gold hedging activities may be flexible and that he would not rule out a shift in strategy in the future. However, Taylor added that Placer Dome would stick by its plan to reduce gold hedging at the present time. (Story .24046)
Black Blade: Do I detect a bit of wavering here? Hmmmm���..
SWISS GOLD: SNB sale unopposed, likely to proceed early May
Zurich--Apr 20--Thursday's deadline to register a public petition opposing the sale of 1,300 tonnes of Swiss National Bank gold reserves passed without objection, paving the way for gold sales to start in early May. SNB spokesman Werner Abegg said the currency law amendment would come into effect in May and the bank could then proceed with selling some of its reserves. (Story .16986)
Black Blade: No surprise here. Socialism wins one - now crank up the printing presses!
As I recall, Capt N had a very specific desire for gold. He delivered it to shadowy figures to be used for unspecified political subversion as retribution for his personal suffering.
If possessed of great quantities of free time, I might study Verne. He may have had some actual knowledge.
Goldsun
For those who might be interested I have been doing as thorough a study as I can on this "thing" interest rate inversions.
I am getting close to being able to offer my observations and provide some meaningful data so that we can have a more intelligent discussion on this matter.
While I have been working on the historical records I have kept up with what the Fed has been currently doing.
Just thought I might report that If "contractionary levels" are when the Three-month Treasury Bill rates exceed the composite rate for long Term Treasury Bonds, then we are getting dangerously close that senario even now.
With the help of others on this forum I would we would be able to factor in these new moves by the Treasury Department in the buying back of Long-bonds and refunding the debt with short-term monies. Of course this would distort the relationship among the various rates because the Treasury is manipulating the supply and demand of the various bonds. I'll not touch upon the Higher danger of finance long-term expenditures with short-term debt as is the case when the Treasury makes such moves. I would not think that the Bond buyers turn a blind eye to this and neither long-bonds nor short bonds will be worth much when true interest rate pressures make themselves known.
A post of the spread between the three-month T-Bill and the Thirty-year T-Bond will follow this one
As for the Swiss sale, since they are the country with the highest per capita gold holdings in the world with no close second, they can well afford to contribute some of their largesse to a good cause. I think the jury is still out on what that cause will be but the gold sales will go through the BIS and disappear.
The Swiss are still a hard currency society and the remaining gold reserves still will keep the CHF a "hard asset class (although CHF not connected to gold...has not been for years).
Total Amature I hope that what you say is true about wanting to learn. I am a new poster, but along time lurker. I have gained a lot of respect and admiration and sensed a lot caring from most of the participants. To think that this "classic letter" from " Father David" has been around and influencing peoples perspective of God for 70 years is truly distrubing. When I look at the history of the United States and what has been accomplished in so short a time I stand in awe, admiration, and thanksgiving for the leadership sacrifice and heroism of our forefathers. The history of the quest for the "riches" of silver and gold and carnage it has visted on the earth in the name of "God" and Country allows me a truly wonderful perspective from which to view the creation of a nation which by any strech of the imagination must be classified as one of Gods greatest blessings. The genius of the men who devised and created the Federal Reserve has not been a curse but a gift. The removing of our money from the daily "discussions" of partisan politicians, represents the stabilizing factor which has lifted the standard of life on planet earth to a level exceeding anything common sense says was possible, and in, when compared with history, a blink of an eye. Until the Fed was created this nation suffered a recession about every 20years and a depression about every 60. Most of us were dirt poor, and the banker, by controlling the gold backed money supply, controlled who prospered and who starved, who kept their land and who relinquished it to the banks shareholders. Our "green pig" as you refered to it was not and is not wealth, but merely a symbol of wealth. It has been the basis for the creation of true wealth, a standard of living unsurpased in the history of mankind, a gain in the life expectancy, health, well being and liberty
necessary for mankinds next step down our eternal road to self determination, our blessing and obligation as beings created in the likeness and image of our creator. Sure, at the present time we are in a cage of debt, a cage made of paper. We need no silver or gold to get out of it. The wealth which was created with its use is all around us, regardless of what happens to the paper cage, the wealth is not going to vanish. There is not one major city in the United States which is not worth many times the national debt. We are wondering why gold has lost its value as wealth as we walk out of our climate controlled home, get into our climate controlled car, and go to our climate controlled supermarket to purchase a vast variety of merchandise with our "fiat" money. This money may be exchanged for anything of value in the confines of this nation by anyone who is fortunate enough of possess it. So long as this situation is maintained, our money is better than gold. Thanks to everyone for contributing to my education, hope I didn't disturb too many people which my first post. Yes, I have some physical gold and a couple of options, but I am not going to set around and cry if either of them lose a little of their value. So long as I enjoy the health and opportunity to work and replenish my resources, I will continue to count my many blessings, and one near the top of the list, must be the creation of our nation.
Perplexed
You said:
Keep in mind that this is altogether different than foreign owned gold that was brought here for temporary safe keeping, and then repatriated. That gold would not show up in these figures because it would have the proper paperwork pedigree for customs such that it would never have been counted as an American asset or good to begin with. We can't count exports that were never offically ours.
________________________________
I think what would drive the decision to list gold sent here for "safekeeping" and then returned to its rightful owner as an "export" would be whether it was listed as an "import" when it first arrived. Who knows what kind of shenanigans the financial world was up to back then? It may have been entered as an import when it arrived to give the appearence of US accumulation and in fact strengthen the US$ when it may in fact have just been a smoke and mirrors play.
The "balance of trade" books extend back for more than one year. If the gold was listed as an import when it arrived, it would have to be listed as an "export" when it departed.
As for the issue of a large secret hidden stash of gold out west somewhere, It seems possible that it could be McArhyr's gold recovered from the Phillipines before Marcos. Since it was purportedly originally Chinese gold having been plundered by the Japanese and buried in the Phillipines, it could well have been arranged to be returned to the original owners in a negotited exchange for "campaign funds?
If such a stash existed it was no doubt a secret from even the administrations and president's. Only a "need to know" basis I believe is the terminology. That whole cover was blown when the ex-CIA chief GB sr. took office and knew about it. If he had free reign to use it as he saw fit then all subsequent presidents would have access to play fast and loose with it as well. Hmmm. Who started this ESF thing anyway?
If such a hoard of gold was brought here from the Phillipines it would have to have been escorted by US Navy vessels...submarine or otherwise. Does anyone on the list know someone who was in the Navy in the Pacific back then? Mid 40's to early 50's. Perhaps they remember strange escort duties of a top secret nature?
If the gold that is being exported came from came from European CB's originally for safekeeping, it would probably have been during the same period of time during the build-up of the Soviet military and their nuclear arsenal. perhaps before the invasion of Prague and the "cold war".
Any gold import data available from that time period?
>>>Six West African states have agreed to create a new shared currency in the region by the year 2003. Ghana, Nigeria, Liberia, Sierra Leone, Gambia and Guinea - agreed to set up the new currency at a summit of the Economic Community of West African States (Ecowas) in the Ghanaian capital, Accra. At present, eight francophone countries of West Africa share a common currency in the CFA franc.
Ghanaian President Jerry Rawlings said globalisation and trends towards the establishment of large economic blocs made the need for integration among the anglophone countries all the more necessary.
"Unless this is done, our economies will remain weak, fragmented, uncompetitive and marginalised," he said.
Ghana's Finance Minister Kwamena Ahwoi said the new monetary zone might eventually be fused with the CFA zone.
Tough criteria
The BBC business correspondent says that the convergence criteria for the new currency may be set too high for many of the six countries to meet.
The primary criteria specify that inflation must be reduced to under 5% by 2003.
The countries must also ensure they have enough foreign currency reserves to cover at least three months of imports by the end of 2000, and six months of imports by the end of 2003.
Central bank financing of each country's budget deficit would be limited to 10% of the previous year's tax revenue.
"These stringent targets will require rigorous discipline and prudent economic management on the part of all member countries," Mr Rawlings said.<<<
Federal Reserve monetary policy is, in essence, a "good cop, bad cop" con game.
http://www.mises.org/ ------
From: The Free Market May 2000
PUBLISHED MONTHLY BY THE MISES INSTITUTE
THE FEDERAL RESERVE AND POLITICAL CORRUPTION by Thomas J. DeLorenzo
LIKE A MAN WHO DOUSES A LARGE pile of rags with gasoline and then warns of a fire hazard, Fed Chairman Alan Greenspan has begun issuing dire warnings of impending inflation after orchestrating several years of explosive monetary growth. To some observers this behavior is just the result of the difficulties inherent in central planning. But the real reason for it was explained by Congressman Ron Paul (R-Tex.): The Fed is a political institution that is used to manipulate the economy for the benefit of White House incumbents at the expense of the rest of society.
As long as Clinton was fearful of impeachment, Greenspan kept the monetary spigots wide open, even while voicing "concern" about an "irrationally exuberant" economy. With Clinton out of the woods and the presidential race in full swing, Greenspan is attempting to reverse the irreversible economic forces that he set in motion over the past two and a half years.
Despite the phony proclamations by economists that the Fed is an "independent" institution, it has never been independent of politics. In 1935 Franklin D. Roosevelt "packed" the Fed's board of governors with political hacks just as he would later pack the US Supreme Court. FDR appointed Marriner Eccles as Fed Chairman even though Eccles had no financial background and lacked even a college degree. In reality, the Fed was run by Eccles's political mentor, Treasury Secretary Henry Morganthau, Jr., which is to say, it was run by Roosevelt.
The Fed has almost always been run the way Greenspan is running it--to accommodate the president's political preferences. In an April 1978 article in the Journal of Monetary Economics the late Robert Weintraub showed how the Fed fundamentally shifted its monetary policy course in 1953, 1961, 1969, 1974, and 1977--all years in which the presidency changed hands. For example, Eisenhower wanted slower monetary growth; the money supply grew by 1.73 percent during his first administration, the slowest rate in a decade.
President Kennedy wanted faster money creation; from January 1961 to November 1963 the money supply grew by 2.31 percent. Lyndon Johnson desired even faster monetary growth to finance the Vietnam war; money supply growth more than doubled during his presidential term to 5.0 percent. These widely varying rates of monetary growth all occurred under the same Fed Chairman, William McChesney Martin. Martin's successor, Arthur Burns, was such a staunch supporter of Richard Nixon that he abandoned his professional credibility by endorsing wage and price controls. Even though Burns's staff advised him that the money supply was forecast to grow by 10.5 percent by the third quarter of 1972, he advocated even faster money creation. The growth rate of the money supply in 1972 was the fastest for any one year since the end of World War II and helped assure Nixon's reelectionand the stagflation that followed.
Gerald Ford wanted slower monetary growth to quell his predecessor's inflation, so Burns complied with a 4.7 percent growth rate. But when Jimmy Carter was elected Burns turned around and gave him what he wanted--an almost doubling of the monetary growth rate. Bums was quite adept at keeping his job by kowtowing to his political masters, This kind of behavior continued throughout the Reagan, Bush, and Clinton administrations.
Federal Reserve monetary policy is, in essence, a "good cop, bad cop" con game. In addition to generating a political business cycle for the benefit of the men who appoint them to their jobs, Fed chairmen also serve as political scapegoats when things go wrong. As described by economist Edward Kane: "Whenever monetary policies are popular, incumbents can claim that their influence was crucial in their adaptation. On the other hand, when monetary policies prove unpopular, they can blame everything on a stubborn Federal Reserve and claim further that things would have been worse if they 'had not pressed Fed officials at every opportunity.'"
In return for this favor the Fed is allowed to amass a gigantic slush fund by earning interest income from the government securities it purchases through open market operations. Since the Fed earns money by buying securities but loses income by selling them, there is a built-in incentive for inflationary money creation.
A 1996 General Accounting Office audit revealed that the Fed's $2 billion annual budget was used to employ 25,000 well-paid employees, to operate its own air force of 47 Lear jets and small cargo planes, and to maintain a large fleet of automobiles (including personal cars for 59 Fed bank managers). A full-time curator oversees the Fed's collection of expensive paintings and sculptures.
The number of Fed employees earning more than $125,000 per year more than doubled (from 35 to 72) from 1993 to 1996, according to the GAO. Even the head janitor, known as the "support services director," was paid $163,800 in salary plus fringe benefits. Millions of dollars are spent on professional memberships, entertainment, and travel.
The Fed operates for the benefit of its executive branch controllers, the banking industry, and Fed employees themselves, at the expense of the rest of society which suffers from the economic instability it creates. Worse yet, many Americans have been conned into believlng that the Fed Chairman operates like the Wizard of Oz, hiding behind dark curtains, pulling levers and pushing buttons to make the economy operate smoothly. So-called "scientific socialism" may have been the most absurd and destructive idea of the twentieth century, but it is nevertheless the guiding ideology of central banking. � FM
A true tour de force. One can never view the economy/markets the same way after reading your works and those of FOA/Trail Guide/Another.
I've previously posted my affinity for some of Karl Popper's theories - for example, the role of falsifiability in assessing hypotheses. Are there events, the occurrence of which (or perhaps the failure of such events to occur within a particular timeframe) which would cause you to reject what you have set out?
To be the devil's advocate, I guess one possible critique would turn on the number of different regimes which would have to take part in, and to preserve the secrecy of, this sub rosa, quasi-"gold standard" (gold settlement based on an unknown, secret "official" exchange rate). Presumably, most of the economically important countries would have to take part. These countries have had changes in government and in underlying ideology, as well as in the membership of bureaucrats in the central banks. How would this secret, semi-official gold exchange rate not have been disclosed sooner(at least prior to Another's posts), given the numbers of people involved? A further possible critique: Why would American offcialdom knowingly pursue policies leading to the deindustrialization and the decline of the US?
Oro's detective work reminds me of that legend whose name is the synonym for masterful sleuthing: Sherlock.
Only, as we read Conan Doyle, we can see (and enjoy) the expert hand of the writer, setting up the story, and burying (some of) the clues for us to find.
Oro, on the other hand, works with a "mystery" others have created, whose clues are hidden "in plain sight" in the maze of statistics and propaganda we are bombarded with daily.
He uses Edison's (or was it Einstein's?) formula of "98% perspiration and 2% inspiration" -- with Oro I'm sure the 2% grows to somewhere in double digits -- combined with a passion for justice for lots of the people trampled by "the great game" of finance, to get at an exciting synthesis at the possibly provable meeting edge of conspiracy theory and economic history.
Unlike Conan Doyle, we CAN check his research and visit the clues for ourselves, and review his synthesis. Time and approximate astuteness are what we require, and I feel remiss in not allocating the former, while fearing I lack the latter to keep up with him should I spend the time.
kapex (art; No doubt!) ID#275254:
Copyright � 2000 kapex/Kitco Inc. All rights reserved
I just wanted to clarify that the gumint can create $$$ out of thin air by buying ANYTHING! If they buy anything with created $$ they are increasing the supply of fiat!
That is not to say offsetting a purchase of some with the proceeds from another sale. But when you buy back t-bonds, bills and notes in the billions you are just creating FIAT!
You might argue that the t-bonds,bills,notes were sold in the first place and that is true, but that money was spent on govt spending for whatever!
So whatever $$$ they took out of the money supply in the first place was put right back in to pay for ( deficit mainly ) roads, bridges, pork barrel spending, whatever. It came out of the system and was put right back!
When they buy this stuff back they are printing FIAT! Pnony money!
Paper!
Oro - Never hesitant to engage in a good debate, I'll throw in my two cents regarding your 29003.
The U.S. has already broken the gold promise once in 1971. Ergo, any future official guarantee of gold-backing for the dollar would, per se, be worth precisely what the dollar itself is worth today, which is to say it would be worth the public perception, no more, no less. For this reason, only defacto parity (not dejure) can ever be credible, and defacto parity is precisely what we have been served up in recent years. This has been accomplished primarily by the steady hand of a watchful Federal Reserve.
You say, "Fiat debt money is incapable of maintaining value without a fix to a real item." By definition alone this statement is true. However, especially in the wake of 1971, any PROMISE to keep the dollar thusly fixed would be suspect anyway. All that can really ever count is a PRACTICE of keeping the dollar fixed. And, much to the bemusement of countless gold bugs, this practice has been accomplished with remarkable effectiveness in recent years.
What is now in question is whether the Greenspan Fed has finally erred in its mission by allowing the recent explosion of monetary growth. I believe recent reports of reawakening inflation in the United States argue persuasively that the answer to this important question is yes.
By the way, Morgan died in 1913. The Fed didn't begin operations until January, 1914.
Thanks for all of your wonderful posts. I value your insight enormously!
As the April contract month is nearing its close, delivery notices have exceeded 10% of the largest open interest figures we recall ever seeing for this specific contract during its prior days as the most actively traded contract. (By comparison, the active June gold contract currently has open interest of 81,500 positions.)
So far, 9,900 April contracts have received notification for delivery...representing 990,000 troy ounces (30.8 tonnes) due to change ownership under the auspices of COMEX prior to April 28th.
What an altogether odd way to acquire gold, wouldn't you agree? I can't help but wonder what must be going on behind the scenes such that acquistion has reached these levels on a *FUTURES* market as COMEX certainly is.
http://www.usagold.com Then Judas,which had betrayed him, when he saw that he was
condemned,repented himself, and brought again the thirty pieces of silver to the chief priests and elders.
Saying, I have sinned in that I have betrayed the innocent
blood. And they said,what is that to us? see thou to that?
And he cast down the pieces of silver in the temple, and departed, and went and hanged himself.
********************************************************
What profit a man if he gain the whole world and lose his soul?
Do you know what level COMEX stocks are at? If they are short, does the gold have to be bought at the "SPOT" market?
If I wanted to buy (I do want-if I could afford to buy) literally tons of gold, I wouldn't do it in the futures market unless I was trying to apply pressure to the shorts. Is that the only logical explanation for buying physical gold in this way? Please feel free to add any other thoughts you may have on this subject.
Thanks.
P.S. Is trying to take delivery of 30 tons going to apply pressure whether or not that is the intention.
If gold has to be bought at spot to make delivery and that causes the price to go up, can't the holders of the long contracts cancel delivery and take cash profits on the price increase i.e. just one more bluff in a market full of them?
http://www.nymex.com/ Some of your questions may be answered if you go to the NYMEX web page and browse around in there.
Someone wishing to deliver gold for a futures contract must ship it to the approved warehouse in the approved form and meet the approved purity etc. etc. In my opinion the only reason that I would take delivery at COMEX would be if I was intending to sell it immediately. The level of COMEX stock seem to stay fairly constant for the most part. This means the sharks are trading between themselves and feeding on innocent suckers who wander in. If you buy 30 tons of gold, it will pressure the shorts no matter whether you buy it at the COMEX or from MK at USAGOLD!
"For gold, one must consider its potential
as a store of value, its long-term support
level of $250, and its Purchasing Power
Parity number of $350 (calculated by the
World Gold Council), and the potential as
revealed by the charts (and in our
monthly research) to rebound to $414.
Rebound or not, gold stores value, and
when gold lost hardly any value even as
$2 trillion were wiped out of the equity
markets the past few weeks, it
emphasized the merits of considering
diversifying a bit into this asset class,
too. Assets reallocated into gold when
stock market risk is high would not have
lost $2 trillion. It was retained, for the
most part, even with no net appreciation
in the price of gold.
There are other alternatives negatively
correlated with the stock market, too,
which provide defensive options during
periods of high stock market risk."
Stranger, the Morgan you refer to is J. Pierpont Morgan, who did indeed die in 1913. The Morgan that Oro referred to is J.P. (Jack) Morgan Jr., who died in 1943. I hope this clears up any perceived discrepancies.
Doug Nolands April 2l Report (Oil Supply Comments Snipped)
http://216.46.231.211/credit.htm"Now, let's attempt to garner relevant insight from history to make more sense of today's
extraordinary environment. First, it is important to appreciate how the oil supply shocks
during the 1970's set off processes with profound financial and economic ramifications,
inflationary and otherwise, that ended in problematic economic distortions and severe
dislocations for the US financial system. In this respect, it is our strong view that supply
shocks during the 1990's, although today remaining virtually unrecognized and
unappreciated, have been similarly powerful in inciting profound economic distortions and
catastrophic financial fragility. The global crisis that exploded in SE Asia in the summer of
1997 and escalated in 1998 with the collapse in Russia and the near meltdown of the US
credit market with the failure of LTCM, was a major supply shock. With the Asian
economic crisis, in particular, having major deflationary consequences, this allowed US
interest rates to remain considerably below what they would have been otherwise,
especially considering truly extraordinary domestic borrowing demands and economic
vigor. Momentously, the Federal Reserve responded aggressively by loosening credit
conditions, giving priority to financial market tumult above the rapidly escalating US
financial and economic bubble. With the double-effect of both collapsing currencies and
domestic demand throughout Asia, imports of a vast array of goods and commodities,
including technology components, were available to US consumers and manufacturers at
sharply lower prices and in seemingly endless quantities. And while the Federal Reserve
likely viewed this as a powerful force working against inflation, the truth was that this
supply shock originating with the global crisis actually proved the catalyst for one of
history's great money and credit inflations."
I HAD THIS DREAM just now, and it scared me so it woke me up! We were at the grocer's trying to buy a can of soup, and you asked the man, "How much is this?" He said, "That'll be three pounds." I said "three pounds!--For a can of soup!" He said "That's the price today, and you better take it or leave it, Buddy! For there's no telling what it's going to be tomorrow!" So we paid him three pounds and walked out stunned!
I DON'T KNOW WHAT HAPPENED IN BETWEEN, but we must have decided we should leave the country because of the monetary situation. A can of soup for three pounds! So the next thing I knew we were at the railway station trying to buy a ticket, and I was asking him for a return ticket, a round-trip ticket.
"I'M SORRY, WE'RE ONLY SELLING ONE-WAY TICKETS," he said. "We have no idea what the return fare would be later. I wouldn't care if you were returning this weekend, I wouldn't sell you a return ticket because I have no idea what the price will be by then. All we're selling is one-way tickets, and we have no idea what the price will be on returns. We'll sell you a one-way ticket at what it is today, and that's it! And that's for your fare today only. It's got to be used today. We've no idea what the prices are going to be tomorrow!"
SO EVIDENTLY WE DECIDED TO GO TO THE BANK and take our money out-what little we had--for due to this skyrocketing inflation its value was being lost so rapidly, and we were apparently going to leave the country.
ON THE WAY TO THE BANK we stopped to watch this train go by. It was leaving the station and picking up speed as it left, at first starting to roll real slowly and then faster and faster, till soon it was just flying! I didn't understand at first what that meant, but I realise now I was thinking, "It's symbolic of how once the thing starts rolling, the inflation really gets going, it really flies!"
THE POUND'S LOST 10% OF ITS VALUE IN THE PAST WEEK! But it wasn't even in the headlines! Isn't that peculiar? It's down to the lowest it's ever been, now, and the dollar is up the highest it's ever been!--I've got something on that too in a minute.
SO THEN AS WE PASSED ON WE WERE GOING THROUGH THIS JUNKYARD of old scrap iron, and I looked at these piles of old scrap iron on both sides and said, "My, if you can imagine, it's not just the price of gold that's skyrocketing, but even old scrap metal like this is going to be worth a fortune!"
WE GOT TO THE BANK AND THE BANK WAS JUST PACKED WITH PEOPLE standing in long queues at each window waiting to do the same thing, to get their money out. I must have figured I could get quicker action by going to see the manager, and I wouldn't have to stand in the queues, so I went through this door into the manager's office.
IT WAS A DOOR YOU PUSH IN LIKE SOME OF THESE ONE-WAY DOORS do, and it slammed shut behind me. I turned around and I looked at it and thought, "That's funny!" I pushed on it and it wouldn't open, for it just opened inwardly, but it wouldn't open outwardly, and there was no handle on the inside so there was no way I could open the door from the inside. I thought, "My Lord this is just like a trap! I'm trapped in this bank!"
THEN ALL OF A SUDDEN THE WHOLE BUILDING BEGAN TO SHRINK! I thought, "My God, this thing is going to crush us all!" The bank was literally shrivelling, crushing, and the walls were beginning to close in on us! But suddenly there came this voice from above: "Don't worry! The Green Pig is about to explode and it'll blow the bank to bits!" (See "Green Paper Pig," posted earlier on USAGold) And I woke up--Boom! Just like that! It was like a nightmare!
I THOUGHT, "LORD WHAT DOES THAT MEAN?" Then suddenly there dawned on me something I told you before: When those big business financiers, were releasing the Green Pig to chase us down the Jordan Valley, remember it was just a little thing at first? But as it raced down the Jericho road and then down the Jordan it got bigger and bigger and bigger just like a big balloon, till by the time it got almost to us it was like one of those big blimps--a huge parade balloon!
OF COURSE! WHAT DOES THAT SYMBOLISE?--AN INFLATION of the Dollar value! The Green Paper Pig was inflating and getting bigger and bigger and bigger all the time, until suddenly it burst! You understand?--The "Green Paper Pig is about to explode and will blow the bank to bits!"--The monetary system is about to explode and cause the capitalistic financial system to collapse!
BUT I WAS SO SCARED of whatever it was, the idea of the bank blowing up didn't seem to appeal to me much more than the bank collapsing on me! The voice said, "Don't worry! The Green Pig is about to explode and blow the bank to bits!" It seemed the voice came out of the sky like an angel.
WHEN THE GREEN PIG EXPLODED, THAT WAS A SUDDEN INFLATIONARY EXPLOSION OF THE MONETARY SYSTEM!--And what happens?--What followed?--It collapsed!--In total deflation! See? That's a deflation: It just collapsed! Then I was thinking, "I wonder if that has anything to do with the comet and the 40 Days and the destruction of America?"
IMMEDIATELY I SAW THE PRICE OF THE DOLLAR GROWING and growing: The Dollar, the green Dollar, the Green Pig, is literally inflating right now very rapidly. But I was thinking, "Lord, how come America seems to be coming out on the best side of the deal, and the dollar's going up in value? If You're about to destroy America, how come the Dollar's going up?" Well it's inflating, so of course it's going up!
IT'S GOT TO INFLATE BEFORE IT CAN EXPLODE! It would be funny if the Lord destroyed America through its greedy god, the Dollar! There might be an earthquake or bombs or heaven knows what, and it could be that too. But the dollar is definitely inflating and it's got to eventually explode!--And boy, if anything would ever destroy America, that would be it!--And of course it would also destroy the whole world monetary system which is based on that Green Pig! (My comment: today there's a replacement ready to take over!)
"DON'T WORRY! THE GREEN PIG'S ABOUT TO EXPLODE and it'll blow the bank to bits!" In other words, that is obviously symbolic of an inflation that's so bad that it finally just absolutely explodes and collapses the whole monetary system, and the bank must represent the financial system the banking system and so on. If this happens, it will literally blow the whole world banking system, its financial system, to absolute bits!
IT'LL BE A TOTAL WORLD COLLAPSE OF THE MONETARY SYSTEM which is built on that stupid Paper Pig! See! Isn't that ridiculous? If that little Pig inflates to that point where it explodes, it's going to literally blow their whole monetary and financial systems to bits! If the monetary system explodes, it will literally destroy the financial system. The bank must represent the financial system.
THAT'S WHERE I WOKE UP, and I was thinking, "How come the poor pound has gone down, down, down, and the Dollar's going up?" The answer came to me as clear as anything: It's the Dollar that really has to explode! It will be so inflated in value that it finally explodes! See? The pound has actually gone down in value, which in a way is safer for the pound, believe it or not, than to be inflated like the Dollar is right now. But boy, our friends better get their money into gold or they're going to be sorry!
THEN IT CAME TO ME as plain as anything: "Well, what do you think is doing it? Why is the Dollar inflating?"--This is what's doing it: They are selling out their European currencies and buying Dollars instead! The banking interests apparently are buying Dollars and dumping pounds and European money deliberately to try to hurt England and Europe for the stand they took on the Mideast! So they're dumping their European currencies and buying Dollars to favour their friend America and punish Europe!
THIS FULFILLS EXACTLY WHAT THE LORD SHOWED ME about what they were doing in that dream about the Green Paper Pig! They're releasing the Green Paper Pig and causing it to inflate, you see?--The Dollar! (Maria: But it's their pig.) Yes, it is their pig, but apparently they thought they could control it.
THEY NEVER DREAMED IT WAS GOING TO GO SO FAR, see? They thought it was going to scare hell out of us and cause us some kind of damage. But instead of that I just pointed my finger at it and it went "Poof"! Boom! Exploded! And that was it! They never expected in to inflate to the point that it was going to absolutely explode and be totally destroyed!
THEY REALLY UNLEASHED THAT GREEN PIG ON THE EUROPEANS, SEE?--Because what were we doing in the Green Pig dream?--Europe was crossing the Jordan of decision and the Dead Sea of death to the Dollar to the side of the Arabs in that dream! The Green Dollar Pig is the weapon they are using against the Europeans for siding with the Arabs for oil!
THEY ARE UNLEASHING THIS DOLLAR INFLATION WEAPON against the Arabs and their friends!--You get it? That would include Britain and Europe, whose currencies are going down in relation to the Dollar. The Dollar is expanding, inflating, going up in price, whereas European currencies are going down.
BECAUSE THEY ARE DUMPING THEIR EUROPEAN CURRENCIES AND BUYING DOLLARS! They have precipitated this monetary crisis deliberately, see? That's why the international monetary fund and all those big money boys, the Council of 20 and Council of Ten, etc., have gotten together several times lately to try to agree on a monetary policy, but they flatly refuse--they can't agree on it. The only reason they can't agree is that they don't want to agree!
THOSE WHO CONTROL THEIR PORTION OF THE MONEY which is tremendous, their big banking interests don't want to stop it. They're using the inflation of the Dollar to try to destroy their enemies, including pro-Arab Europe! They know how much money those Arabs have got invested in Europe, and they are trying to destroy not only the Arabs but the Arabs' friends, which would include Europe and Britain.
BUT THE INFLATION WHICH THEY HAVE PRECIPITATED WILL GET OUT OF HAND AND THE DOLLAR WILL EXPLODE AND BE TOTALLY DESTROYED INSTEAD! Instead of becoming a monster that was going to frighten and devour their enemies, when I pointed at it, it exploded!
SO THE DOLLAR IS INFLATING LIKE MAD RIGHT NOW, and when it gets to that point that it explodes, the whole world monetary system will collapse!--And the bankers and capitalists will be left sitting on their stacks of bank notes which will be worthless!
ANOTHER THING WHICH SHOULD HAVE BEEN HEADLINES IN THE PAPER YESTERDAY WAS THE PRICE OF GOLD: It's up to nearly $140 an ounce, the highest it has ever been in history! There wasn't one word in the paper about the fact that the pound had sunk another 10% in a week and that gold had gone up almost another 10%! This shows the Dollar is really not all that valuable, but only better than other currencies. So it began to dawn on me what all this meant, or what it could mean: The soon explosion of the Pig!
THEN I SUDDENLY REMEMBERED THE NEWS THAT RUSSIA HAD JUST ANNOUNCED SHE'S GOING TO CARRY ON ROCKET TESTS in the North Pacific and warned shipping to stay out of the area. I wonder if that has any connection? What could that mean? Why should she be warning shipping to stay out of that area right now, which is near Siberia and Alaska?
WHAT IF RUSSIA WERE PLANNING TO TAKE ADVANTAGE OF THE SITUATION, knowing somehow that America's monetary system was about to collapse and therefore weaken the whole country? If the Dollar collapsed America would absolutely collapse! When she collapsed financially, she'd be in a state of absolute chaos!
THAT WOULD BE THE SMARTEST THING IN THE WORLD TO DO, TO TAKE ADVANTAGE OF AMERICA IN A STATE OF COLLAPSE and absolute chaos for an invasion! The logical way for Russia to invade, of course, the way that Americans have always been afraid she was going to invade, is the shortest possible route right through Siberia right across the Bering Straits into Alaska and down. Now that's quite possibly what Russia has in mind!
BUT HOW COULD THAT AFFECT THE MIDEAST? Well of course, dying America in its last desperate death struggles, what would it do? What was causing it to collapse? If her money had collapsed and she was out oil, what would become the only valuables in the world?
IF AMERICA'S WHOLE SYSTEM WAS COLLAPSING AND SUDDENLY GOLD AND OIL HAVE BECOME THE ONLY THINGS THAT ARE WORTH ANYTHING, the only commodities with standards of value and usefulness, what would the Americans do as a last act of desperation? Dying America would do what?
AMERICA WOULD TRY TO ATTACK THE ARAB COUNTRIES AND GRAB THE OIL AND THE GOLD! Whatever super power possesses and controls those Arab countries would have all the oil and they'd have most of the gold too, and they would have what would be the most valuable things in the world at a time of crisis like that!
SO THE EXPLOSION OF THE GREEN PIG, THE MONETARY SYSTEM, COULD CAUSE THE MIDEAST TO EXPLODE. I have always theorised that it was because of the Arab defeat that they were the ones who would get desperate and start doing the shooting. But the reason we saw the Arabs in our vision doing the shooting could be because they realised or had intelligence that America was about to attack, so they just started attacking first, and then everybody started shooting because they were all prepared for it anyhow.
40 DAYS! 40 DAYS, BY THE WAY, IS THE TIME ALLOTTED FOR THE ISRAELI DISENGAGEMENT FROM THE EGYPTIANS. 40 Days! Russia is smart enough to see what's happening or about to happen--and, who knows, she may even be helping to engineer it! Russia has long sought to engineer the collapse of the capitalistic system. What better way to help the collapse of the capitalistic system than to explode its monetary system and its banking system, its whole financial system?
SO THE RUSSIANS MAY BE GOING TO TAKE ADVANTAGE OF THE SITUATION TO ATTACK A WEAKENED AMERICA. What a perfect preparation for any proposed rocket attack on America! The Money Explodes! The Dollar Explodes! Inflation Explodes!--And War Explodes!
THE LORD APPARENTLY GAVE ME THE DREAM TO WARN US THAT THE PIG IS ABOUT TO EXPLODE and is going to destroy the monetary system and with it the financial system, and with it virtually the whole capitalistic system; and Russia is probably preparing to take advantage of situation to destroy America.
AMERICA IN ITS LAST DYING DESPERATE HOURS IN VERY LIKELY GOING TO EXPLODE IN THE MIDEAST and try to grab the oil and the gold to save herself. As a result, America and Russia would be going to war and destroying each other, which would work out just like we have seen it before.
THEN CHINA, EUROPE AND THE POOR NATIONS OF THE THIRD WORLD COULD TAKE OVER: THAT'S THE HAPPY ENDING! So praise the Lord! Boy I tell you, we are without excuse! The Lord has warned us so much!
The above letter was written January 24, 1974 by Father David. I don't know how many people saw it this way back then! There seems to be an amazing amount of correlation between what has been said on the forum lately and what we find in this letter written 26 years ago. God likes to give us an early warning! Time is getting shorter!
Sir Econoclast's questions on COMEX...and revisiting an important quote from ANOTHER's THOUGHTS!
In total there are 110,525 ounces of eligible gold and 1,856,270 ounces of registered inventory on the books of the two official COMEX gold vaults...housed at ScotiaMocatta and at Republic National Bank of New York. As you can see, the 990,000 ounces represented by delivery notices on the April contract is a figure larger than half of the COMEX inventory.
If those on the sell/short side of these 9,900 contracts that have delivery obligations are among those who have gold already registered within the COMEX system, then there would simply be a transfer of title/registration on the books. Under such a scenario, the would be no demand pressure hitting the spot market. Similarly, if these same entities have gold in a private stock, they could yield it up without pressuring spot demand. And in fact, if those on the receiving end of these deliveries are content to let COMEX remain as the guardian, then we could actually see the level of COMEX gold holdings rise as a consequence.
However, if the current COMEX gold inventory reflected only the positions of contented longs, and those who theoretically sold gold and are now faced with delivery obligations do not have gold in their private stash, then they have two options. First option, they would turn to the spot market, bringing this demand pressure to apply upon the metal to be found there. Second option, they could "pass the buck" by entering the buy side of other April contracts and calling for delivery with which they will satisfy their own obligations. This "passing of the buck" could occur many times until a seller was found that had the required gold either in the COMEX system, in their private vault, or else by turning in the end to the spot market at some point prior to the delivery deadline of April 28. Of the 9,900 contracts held up for delivery, what are the chances that the buck was passed 9,900 times to satisfy one original delivery notice for a single 100 ounce contract??? My guess is that the buck is passed to a dergee, but that in this case it would not constitute the bulk of the delivery intentions. One reason for this conclusion is that around 7,000 contracts were immediately given notice for delivery on the first possible day...March 31st.
As you can imagine, this "passing of the buck" would first put demand pressure on the April contract itself, then maybe the spot market as necessary...depending on where the gold finally came from to fill the order (COMEX inventory, private inventory, or spot). Such demand pressure on April contracts or spot markets would be acceptible, because at this point April is off the radar screen. All focus is now upon the widely reported most active futures month which is June in this case. (And as you should know by now, the spot price is mathematically derived from the most active futures month's prices.) Another reason the "passing of the buck" probably does not artificially inflate the delivery intentions and hence the apparent quantity of gold scheduled to change owners (prior to the April 28 deadline) is that the institutional players without gold but with a desire toward suppressing the price would have settled their April contracts with cash (probably with a profit?) prior to being subjected to delivery obligations on First Notice Day (March 31). Upon the arrival of this important deadline, they would have moved into the future month of June, making it the active one, and would continue to short with delivery immunity while the April delivery drama would play out behind them.
It should be clear by know that all that is necessary to cap the U.S. price of gold for those desiring to do so is to continue to sell the active month futures contracts more aggressively than anyone else can be found to buy them. Not only are they thereby immune from the possibility of being stuck with delivery obligations for gold that they couldn't provide, but their depression of this highly publicized futures price will generally diffuse any desire for the remaining April longs to seek delivery of a postion that is already apparently underwater as a cash loss. And for the same reason, the typical western investor mindset will not be putting much demand pressure on the spot market either. (Now you get a small feeling for why this latest delivery demand upon COMEX contracts seems outside the norm.)
I wonder how many of these institutions are selling the futures (and as a bonus possibly making some money as the price falls by their own effort) while at the same timie buying what little physical metal remains available or is capitulated upon the spot market by those who see no end to the fall. In this context, consider this very astute observation of ANOTHER:
"Think now, if you are a person of "great worth" is it not better to acquire gold over years, at better prices? If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to follow!" --ANOTHER (THOUGHTS!) 1/10/98
You see, ultimately it is the ability to acquire the metal itself that is important, and falling prices are a means to this end. But lest you think there is no end in sight, I assure you this process has its limits. At the absolute worst, the system breaks down when the active futures month reaches a price of zero. But it take little awareness of reality to convince yourself the breakdown shall happen long before. For even as the typical western investor turns gold aside to seek the ownership of dot.coms on Wall Street, the rest of the world is buying whatever gold can be purchased with their own feable currencies. Sell currencies to buy dollars, use dollars to buy gold. You know see a reason why the dollar continues to look strong on the foreign exchange markets, and yet the price of real gold metal is disguised behind the mask of futures selling...the selling of just one form of paper gold derivative. At some point the last available golden chip is taken from the market table, and only the payment of higher premiums above the artificially determined spot price will get you the gold you seek. This would be the separation of the paper and physical market prices that has been discussed here in the past.
Finally, think on this: the quantiy of any available dot.com stock can be doubled as easily as a stock split. Again and again. In contrast, the quantity of available gold can only be doubled by decades of exploration and mining effort for the naturally occuring reserves of a scare mineral that would only thereby be getting ever scarcer to find. In the event of a general economic crisis such as one brought about by the failure or dethroning of a world reserve currency, would you expect gold to provide a platform by which international minds could begin to relatively measure the wide value of various assets? Would you be inclined to agree that gold would rise to the top, while paper assets measured by other forms of paper would all be seen of dubious and uncertain merit? Stock splits, anyone? Currency floats, maybe? My treat.
why I suddenly had the tendency to make the error of typing "know" when I meant "now" on several occasions. Hopefully you can decipher the meaning anyway in this very important post...if I may be at liberty to so judge the output of The Tower.
Is this just TPTB whipping some of the whimpy longs out of the market?
There is an additional aspect to the silver pledge...
ANYONE OUT THERE WHO "THINKS" THEY OWN SILVER because they have a coupon that says so, should pledge to send the coupon in and ask to have the material delivered to their homes.
That price is as of the close THURSDAY, and is actually .02 higher than the close today overseas.
The .13 drop is from their spot price before the Comex dropped that morning.
They make their own market from their own ongoing inventory and may be higher or lower than major Exchanges at any time.Those fluctuations reflect the decisions of their own market maker based on the activities of their own sales force.
Their price chart is not an indicator of the PM market. It is their own in-house (median) price list.
Well, I know for sure it's a song by Donovan (late 1960s?).
But I don't remember the rest of the words to the song, so I
don't know if he answered the koan. Is it a journey over the mountain itself?
I love riddles! Maybe that's what attracts me to reading this forum. Gold and Stocks...Talk about a puzzle, wrapped in an enigma within a conundrum!
Thank You, Poor Ol' Sol,
simply meView
Yesterday's Discussion.
Today I spent some time chatting with a client of mine here in Kyoto, who is the president of a local company that is currently preparing to do an IPO. He is relatively well connected, and has strong contacts with people in business, government, and educational circles.
We discussed how the current "dollar based trade system" primarily benefits the US. I asked why Japan and Europe had supported such a system for so long. He explained that the Japanese leaders were aware of the issue, but due to security concerns, they have been unable to address it.
However, they have developed a "Miyazawa Plan" to set up an "Asian currency/bank", and to date this plan has been strongly opposed by the United States. He mentioned that it might be easiest to implement such a strategy should there be a crisis in the US$ and/or the US stock market. Such a crisis would provide a strong impetus for Japan and the other Asian nations to set up their own currency/banking system.
He says Japan has received clear warnings from the US to NOT raise interest rates. Apparently the 0% interest rate policy is getting old and they want to move away from it, but it would deeply damage the $ and the US markets..........or at least that is supposedly why the US issued the warning.
Let's say I am a billionaire grown weary and leery of the stock market and wanted to buy bullion. In what way and to what extent would the said shortage of physical gold hinder me accumulating let's say 1 billion dollars worth of physical gold?
What would be the best way to go about buying this to avoid driving up the price?
Looks like GW just locked up the Hispanic vote in Florida. Janet Reno is jabberin away and shaken like a leaf (parkinson's disease I suspect) - makes Muhammad Ali look quite fit in comparison. Can barely hear her above the incessant rattling of her shaking against the podium. All Billy-Bob has to do now is hold the phoney new economy together enough until Jan 20 next year, then blame the market collapse on the incoming Republicrats. Hmmmm.....
My good friend Andy consults to institutional money managers. He has been quoted in Barron's Marketwatch column for many years and has contributed articles-(Uponroof-if you could post his quote this week, I'd appreciate it). What is so unique about Andy is that for at least ten years he has been correctly bullish and uncannily predicted the step by step unfolding of this mega-bull mkt. He said way back in 19993 that by the end of the decade the DOW would be well into 5 figures--So what's my point--Just this--He makes an astoundingly bearish call on the Nasdaq--Here it is----"While rallies lasting a few days will be sharp, the entire vertical advance from late October-(at 2800)-should be retraced, and possibly back down to the 2450 low.----------Unlike prior recent sharp "waterfall" declines, this one was not preceded by an outside event. There was no equivalent of the LTC implosion, no savings and loan crisis, and no threat to the world's oil fields (i.e. Kuwait). Once these problems were attacked, the markets began to improve. This time it may take longer for the Nasdaq's wounds to heal. If the technical action of the online brokers is an indicatior, then Nasdaq's bear phase has further to go in time and price.----The double top in the 5000-5100 area....has been increasingly formidable. Displaying similarities to the 1987 double tops in the DJIA and S&P averages." ----I can't impress upon you how unique Andy is. He is not some two-bit letter writer with a 187 subscribers--He is a big time consultant and a sophisticated & brilliant manager--I know of no call of his that was not a bull's-eye.
How the yen has any international standing is a great mystery and a stunning victory (so far) for the fiat currency regimes--With "free" yen (zero interest rates) and round the clock running of the presses for a decade, the Yen is truly the 8th wonder of the world--If, as we say on these forums, the U.S. dollar is toilet paper, then the Yen does not have even this minimal functional value--t'is more akin to a urine-soaked gutter rag.
....that south Florida ends up in a shootin' fracas over "lil Elian"? The governments propensity to make mountains into mole hills not withstanding, hasn't this little drama seemed too orchistrated? Anytime the American public (sheeple) are spoon fed a story for this long, there is usually an under"lying" motive. (yes, savor the double entendre there) With the Oklahoma City tragedy, the message was "patriots are hatemongers and murders". With the Colombine tragedy, the message was "those who oppose gun control support school violence". So far, it looks as if less than half of the people are buying this crap. Still I wonder, what is the point of the "lil' Elian drama" and what do the Clintonistas have to gain? Does Clintons employer (China) want El Jefe to gain a better militant foothold in south Florida? Whatever drama results can easily be blamed on the obviously senile Attorney(turned)General Janet Reno. Our economy is a house of cards. Janet Reno is a tottering old crone. Florida is tinderbox where ethnic diversity has become very strained. George Dubya's brother can be scapegoated to make George look bad. We have Pro-Castro and Anti-Castro Hispanics, the KKK, drugs, and the makings of another long hot summer. The catch phrase has become "the rule of law". The Clintonistas like to load the language with catch phrases. Watch them when they do. Amatures have a habit of telegraphing their punches.
First there is a mountain.
Then there is no mountain.
Then there is a mountain.
I'm not sure it's a koan. But it does refer to the experience of the Zen (gold) student, who has gone his whole life seeing the world in a certain, limited, way.
Then the first period of Zen learning (USAGold Forum lurking/posting) shakes up that worldview and everything is turned upside down. All previous learnings are called into question, might even be thought to all be false and worthless, in this new light of revelation and the excitement of discovery.
Finally, the new knowledge is integrated into the learner's life, he returns to former pursuits, family, his more consistent character reasserts itself, but he is forever changed by the learning experience.
Remember! Before there was Alan Greenspan, there was Alan Watts! (Yes, I know -- the great Zen exponent was reputed to have drunk himself to death. Not the only one. Be happy for our simple lives as cultural unknowns.)
Figures from Japan's Investment Trusts Association show that the annual move into foreign currency-denominated investment trusts is much lower than in previous years. Initial subscription has so far amounted to 6.7 billion yen this month, compared to ten times the amount in April 1999. Investors are more attracted to Japanese stocks, and are concerned about volatility in the US.
I don't trust something so foreign as 0% interest rates. Maybe they should just pay us to borrow the yen (negative interest) Take 10 million and only have to pay back 9 million. Good way to accomplish yen appreciation? Less yen around and same basis? Oh yeah I forgot they want a weak yen.
What is the real difference between that and borrowing 10 million USD for thirty years at 8%. When the thirty years are up and you pay back the USD's worth only a small fraction of their worth when borrowed. Wheelbarrows of USD's for a cup of rice.
Find a Jr. Exploration Company sitting on top of a mountain of gold but needing financing to develop it. Cut them a good funding deal...Gold at production cost in return til debt is paid-up
Go BUSH with 15 million new Hispanic recruits! Elian,"the camera is your friend"
http://www.usagold.comWelcome Total Amateur to the Arena of the Gladiators of Gold. Where TGB's get stomped and carted away. Was it a free thinker's playground or just a river of dispair ready to overflow its banks due to the runoff of so many underwater long positions. Never-the-less let us not give up hope though Charlemagne dost not yet arrive to re-institute thy most sacred golden standard. Though we have a common enemy, that being our our greed for buying in too early, seldom do we unite.
Enough with the drivel and back to the markets...........It's a global sellfest I tell ya, last week Nikki had a run in her stockings and upset quite a few friends at Friday's party. May we soon see "the attacks on the DAX" Ya, and probably would pull das capital out of the US Naz and Dow for margin covering. A total guess for the liquidation mess. Anyway we can surmise that the ploy of the PPT is to sustain foreign inflows into US equities markets to alleviate the monthly trade imbalances. But for her to do the triple axle she needs more momentum and methinks she is headed for a fall. When these foreign inflows abate then we know the numbers won't be easy to hide, that's the fire ready to light under gold. It's all turning to Jeckle and Hyde. I'd say we have about 20 minutes into the open to establish short positions on techy crap and it's all rolling over and down. No need to predict the bottoms as a bear market has no bottom. If it doesn't fail Mon. we can watch the semiconductors as they get soft. Its then that the rollover begins. But as you beat the tar out of a fellow TBG named Old Gold whose only crime was saying what no one else had the guts to say.........
Keep on wondering on..........and get ready with your shovels to bury more metal but this time when you choose a new location, be sure to visit it a few times afterwards so you don't forget where the spot was like what almost happened last time, remember.
============================================================
Total Amateur, you olympic typist, where is the link to the speed reading course so I can finish your last post. Just watch out for any open sores on your legs when you wade into this sea of dispair for truely truely I assure you that ye are paranna bait. They only have mercy on you because you are new. So ask a someone who knows a little less than you to write in so the bully buryers have another victim to stomp that your psyche may endure long enough to eventually gain a fine education from this wonderful site.
"We don't want no trader education"
"We don't want any futures markets mind control"
"No weepy sarcasm on the forum"
"Hey Trader gold bugs, leave us buryers alone!"
"All in All It's just another brick in the ground"
It's me the paper goldbug you want, let the boy go!
Little Elian and Poppa are happily reunited. Ol' Janie reigns her mount west, into the setting sun. Father and son should be back in the land of fine cigars and rusting cars by tomorrow night. (They are going home now aren't they?????) I hope there isn't a "rule of law" that remains to be settled? Kinda reminds me of the closing scenes of Casablanca. "If you don't get on that plane, you'll regret it...maybe not today...or tomorrow.... but soon and for the rest of your life." Hey folks, if they don't get on that plane today, or tomorrow, buy GOLD soon, Flight $280 may be the last plane out.
"The copies of gold and silver inflated,
which after the theft were thrown into the lake,
at the discovery that all is exhausted and dissipated by the debt.
All scripts and bonds will be wiped out."
-- Nostradamus VIII.28
Interesting to say the least........"Happy Easter to all"...YGM
Happy Easter to everyone. I don't often get a chance to write anymore and seldem to lurk (going through a career change at this late age in life). I do glean those little nuggets from time to time and really appreciate the forum. MK & Co. have done a wonderful job. God bless!
Date: Sat Apr 22 2000 15:21
nomercy (Is the Euro ) ID#207145:
Copyright � 2000 nomercy/Kitco Inc. All rights reserved
In the last year the Euro has 'lost' over 20% of its value versus the US at the same time their growth is rising from 2% to projected 3.6% in 2000 and 3.5% in 2001.
This 'devaluation' has enabled the EU to steal markets from both the US and UK.
Trade deals have been made with South American countries and Mexico in the last 3 months, right in the US backyard.
The UK manufacturing sector is being taken to the cleaners as they are unable to compete.
It appears that both the US and UK strategy, of maintaing their currencies artificially high is going to bite them up their butt, sooner rather than later.
The 'gambit' over the New Economy and the Interent hasn't panned out. The US and UK "growth" has been accelarated as they poured billions in trying to construct a 'new industry'.
The question is is the new industry, e-commerce, generating enough revenues to justify the investment?
Thus far, the returns have been negligible and more than 1/2 of dot.coms are cash starving.
Which currency are going to going to oblivion?
Oh yeah if you want to help the US and UK in making dot.com's successful don't forget to CLICK ON THE BANNERS of each site you visit. It's a fundemental method of Dot.com generating revenues.
If you are a UK citizen and supporter turf out BROWN. He is incompetent
Who else would be willing to sell their Gold reserves at the lowest possible price?
Yeah right Canada.
And who started the ball rolling in bringing Gold down?
Yeah right Australia.
Which Banks have the most exposure to gold derivates?
Yeah right USA
...........
No wonder EU wants to break away from this nonsense
Japan is the worlds' largest (only?) creditor nation, massive amounts of Yen are owed to Japanese banks and institutions and it is necessary to buy Yen in order to make these payments.
The '90 collapse of the Japanese markets and economy has resulted in a deflation due to their creditor status.
It is anticipated by gold bugs that the opposite situation and currency picture will result here as the US is heavily indebted.
http://users.erinet.com/3354/gold2400.htm I made a little chart from the data available at http://www.imf.org/ (click the link above) There was no data for the Euro on 4/21.
It will be interesting to see if the trend continues next week.
Solomon, I saw the challenge you posed to the forum--
------------
"...do you know the meaning of this KOAN:
First there is a mountain.
Then there is no mountain.
Then there is a mountain.
Any guesses out there?"
------------
and I thought you might enjoy a similar mind-expander I offered many months ago. Here it is as follows.
* * * * *
((Overheard near the Academy))
Pupil: Kind sir, would you mind if I asked a question of you?
Aristotle: (with a smile) I'd say you're about one question too late with your request.
Pupil: Huh?
Ari: Do you have yet a third question, my young friend? What's on your mind?
Pupil: What is money?
Ari: Only a zen master could answer such a question.
Pupil: But that is why I asked YOU.
Ari: ((smiles)) Of course, my fine friend, and yet there is this difficulty too--such a question should also be asked ONLY by a master, for only a master will understand the answer given.
Pupil: But I have been in training for a long time now. How will I know when I have become a master?
Ari: My, but you have a short memory! Did I not just now reveal one such suitable test?
Pupil: It is true that you did. And so to discover the one or both together, I shall ask you now, "What is money?"
Ari: In answer to "What is money?" I need only tell you this: "When you have a moment to do so, look at it. What you shall see is money." I must now be on my way, and shall leave you to dwell on this as you see fit.
Master: ((after a brief moment of thinking)) Eureka! How could it be otherwise?!
Ari: It is always a pleasure and an honor to look upon a master such as you.
Master: As you already know, it's not so much what you see, but where you choose to look.
Aristotle: Of course...how could it be otherwise.
* * * * *
In regard to your mountain question, I'd say Mr Gresham's (4/22/2000; 8:19:45MT - usagold.com msg#: 29167) is nearly spot on.
To me, the three mountain phrases represent a "journey" that can be undertaken on a physical, intellectual, or spiritual level. Mr. Gresham aptly described the intellectual "journey" where the mountain is representative of a problem that requires an effort of thinking and learning to solve. Once the understanding is attained, the perception of the mountain as a problem is gone. It is replaced by the memory of the "mountain" as a problem which is now become a mountain of knowledge and intimate familiarity with every facet, rock, and crag of the former puzzle.
The representation of a physical journey is very easy to grasp. You see a mountain before you on your path---"First there is a mountain."
Then you toil your way to the summit, from which vantage point the mountain is gone because it is easy downhill walking in all directions---"Then there is no mountain."
As you continue your easy journey in any direction you may choose, the mountain reappears behind you---"Then there is a mountain."
ThaiGold, you asked--
ThaiGold (04/19/00; 22:58:03MDT - Msg ID:29075)
Attn: Aristotle, What's YOUR GoldPrice.?.
Comment: I'm unsure anymore of what's the "actual"
price of gold (etc). There's Paper_Gold. There's
Physical_Gold. There's Spot_Gold. I post here the
Spot_Gold. But I'd rather post the Absoloute Most
Real price imaginable... So I'll just ask Aristotle:
"At what price would you part-with an ounce of yours.?."
A beautiful question, my fine friend. As I sit here contemplating you question, I have the benefit of four British Gold sovereigns spread out across the top of my keyboard for inspiration. It occurs to me that the fair price I would demand, based upon what I now know and perceive to be true, would be either three or four months of shelter/lodging for each sovereign (in lieu of paying cash rent) in a modest apartment in a typical American city. Therefore, my price per ounce would work out to be one year of quality shelter (or a little longer) per ounce of Gold.
I'm sure you will agree that those terms are more meaningful than saying that my price for parting with an ounce would be such-and-such a number of currency units. This is in keeping with my philosophy that currency is to be used to increase your "net worth" in real wealth. As soon as you have made the currency exchange for the real wealth of food, clothing, shelter, or Gold, what is the sense of risking any of them on the gambling table in a bid to increase your account of currency units?
Think of it this way, when someone goes to Las Vegas and gambles away the currency in his wallet, or even drains his bank account while playing the roulette wheel, we might tend to say he paid a pretty high price for his day of fun in trying to win currency. But if he left Vegas literally without the shirt on his back, and without the deed to his house, we would surely say he has a problem, and call him a "poor bastard" at that.
Please also understand what I am saying here is not that I would insist that my one ounce be used directly in payment for the yearlong rent on an apartment. I would have no problem making the intermediate monetary exchange for the cash needed to settle the deal. I am only saying that I will only roll Gold wealth into other forms of wealth, I WON'T roll it into currency for currency's sake alone. So as you can see, my currency price for Gold is very flexible, and changes with the changing paper price for a year rent. If monthly rent were $1, then my Gold price would be $12. If the monthly rent were priced at $500, then the "Aristotle price" for Gold would be $6,000.
As you can see, I feel Gold is undervalued relative to other real wealth by more than a factor of 12 because as it currently is, one ounce of Gold would not even be adequate to pay a month's rent, far short of the full year I feel would be appropriate.
OK, your turn. Based on what YOU know and perceive, what do YOU feel is your fair parting price for Gold?
Seems we have the forum almost to ourselves this Easter! Thank you for your advice. Sounds good. I would like to talk more with you about these things. Maybe we could work something out together.
Could you please contact me through forgold@hotmail.com
Date: Thu Apr 20 2000 14:32
Rick (@ ORO....here is a post from Tzadeak ) ID#413328:
Copyright � 2000 Rick/Kitco Inc. All rights reserved
TZADEAK* @ ORO
copyright all rights reserved 4/20/00
I have been waiting patiently for my "royalties" for my contibutions to your
now famous "book", ( I knew you would like that one ) .....
On a serious note, I've had an opportunity to review you latest "snippet" and have few very brief comments.....
( I understand you're testing the waters ) .....
I have included, below, my original post of 12/97, which has "seeded"
many of the themes in your latest "exceptional" post......
BTW I also noticed ,you have now incorporated my "plunder'" idea, and I must say, you have expanded on it very nicely.....
As I have indicated on a number of occasions, there is no "trail"
ahead of us in matters realting to the fiats valuations for Gold ,real or
perceived, since that necessarily involves in part a myriad of complex
actions and reactions, human and others, that don't always, if ever
behave the way one would expect......Gold will lay the "trail" ahead....
that being said....
I would not be as certain, in terms of a "time" frame for the "collapse"....
As I had indicated in 97, the "FIGHT" for Gold has begun, the first
"battle" was the so called Washington Accord.....I still chuckle
at the "title" of the said agreement, when a more appropriate
"title" would be the "EURO" Accord....
I also indicated that this "FIGHT" will last a long time, as I continue to believe.
As an example your "missing" 800 yearly/tons is now being
covered in part with "scrap" recovery and unreported Gold mining activities in number of "foreign" countries......the covert "plunder thing"..... and of course "other" means.....
I am somewhat surprised that you have not expanded "further" on
my 97 post's "Gold Backing" US$ in view of the very recent comments by Greenspan on that very issue...
If I may suggest, re-read his comments very carefully and you may find a few "chilling" potentials.....
ciao for now.....
repost
Date: Sun Dec 07 1997 21:36
TZADEAK* ( @ Another, "Thunder" only happens when it's Raining.... ) ID#372344:
Nice to hear from you.... I see you've been lurking......I believe IMHO that we along with most Kitcoites agree a large up move in Gold is near. Our only difference appears to be in,,,, how much,,, how fast........
Here is a "thought" for you,,,,,
What if the US and maybe others decided to "avoid" the coming crisis by
announcing that the new "paper" $ they have been printing for the last 5
years or so is really the New "DOMESTIC $" with "GOLD BACKING" and that the US would turn "inward" much like in the 1930's with almost all its OILand GOLD ect... labor etc supply coming from The America's and leave the rest of the world holding "the bag"... ( FOREIGN $ ) ... . By the way , in the 1930's the US gave out large sums of paper $ to North American miners to produce Gold, and those stocks did well indeed. I believe ( as mentioned in my earlier post ) the GAME now is at
"Who" is going to INFLATE? the US, Japan , .....The latter was an ally of the Nazis Thus know all about German HYPERINFLATION.......
IMHO "THE WAR ON GOLD" will be coming to an end.....
and "THE FIGHT FOR GOLD" will begin.......
This 'FIGHT' will last a "long time". .....As you know paper currencies last only so long 20, 40, maybe 60 years before they are burried in the "currency graveyard"....
and it is only "near and/or at their death" that the
THUNDER of GOLD'S !!!POWER!!! is heard.......... It has begun to rain.........
Return to Kitco Homepage
------------------------------------------------------------------------
Dear Scrappy: I'm SO glad you wrote in!! I've thought of you very often and wondered how you've been. Please write again sometime and let us know how things are going for you!
Yes Aristotle....Mr. Gresham is pretty close to the mark.
Mr Gresham (4/22/2000; 8:19:45MT - usagold.com msg#: 29167)
The Zen of Gold -- Solomon!
First there is a mountain.
Then there is no mountain.
Then there is a mountain.
------------------------------
Solomon adds
First there is a mountain. But the perception of this mountain is clouded by false understanding of the nature of the mountain. (TODAY WE HAVE A PAPER GOLD MARKET WHICH MANY DO NOT UNDERSTAND IS AN ILLUSORY PERCEPTION OF THE UNDERLYING PHYSICAL MARKET). The mountain is more related to what we think it is or what we want it to be than what it simply is. (THE "VALUE" OF GOLD IS CAPTURED IN AN ILLUSORY POG, WHICH IS MORE RELATED TO WHAT LARGE DOLLAR HOLDERS THINK IT SHOULD BE THAN WHAT THE "VALUE" SIMPLY IS.)
Then there is no mountain. As the mind strives to comprehend the true understanding of the mountain it is first forced to reject the mountain, until it realizes that it is the "perception" of the mountain that is false. (AS THE LIQUIDITY OF THE PAPER MARKET COLLAPSES, MANY REJECT GOLD, UNTIL THEY COME TO SEE THAT IT IS THE PAPER ILLUSION WHICH WAS FALSE.)
Then there is a mountain. The mountain was never really gone. Only the mind's understanding of it has changed. The mind now see's the mountain with a true perception which is free of illusion...and the mind, like the mountain, is at peace. (AT THE END, THE TRUE UNDERSTANDING OF GOLD EMERGES, AND ALL REALIZE THAT THE "VALUE" OF GOLD HAD NEVER BEEN GONE, IT WAS JUST HIDDEN BEHIND THE PAPER ILLUSION.)
------
Aristotle - I like your answer too, than when in the midst of the climb the mountain is gone...only at the bottom and top is the "mountain" just a mountain.
By the way.....on your Master what is money riddle...I am correct to interpret that the master implies that in truth, money is actually nothing more than itself...only it then becomes "what we make of it"???
Poor old Solomon
I'm not sure it's a koan. But it does refer to the experience of the Zen (gold) student, who has gone his whole life seeing the world in a certain, limited, way.
Why the NASDAQ deserves a somewhat higher PE ration than the SP 500
One of the great fallacies of some gold bugs is too believe that gold is the only true holder of value...just buy some and wait for the world to collapse and be rich. The only true holder of value is our ability to collaborate with eachother. We are almost completely incapable of survival without our "system" in place...
I fully concur with those out there who say that putting some of your savings in gold allows one to sleep well and live honestly.
My profession is not really that of a philosopher...I am a biotechnologist...I was spending some time on the internet today reading the SEC reports on some of the companies which I had on my radar screen about 3 years ago....I was amazed how many of them have burned through $50-100 million dollars researching a drug, only to find the drug almost worthless, and now they are almost bankrupt. Does this mean that the company created no value??? Certainly not.
What it does mean, is that much of the research costs of discovering new drugs is now being borne by the shareholders of small technology companies and is no longer hidden inside of the research costs at large pharma companies.
In the same way, much of the costs of creating the new business models for cybereconomies is being borne by the shareholders of small internet companies. Take Amazon.com for example...their aggressive move to dominate online book and music selling created a massive reaction in the retail industry to go online....I see no value in the stock of Amazon.com (except if Coca-cola wants to buy it for its trade name like Warner did with AOL), but there has been a lot of "value" created by the "fear" that Amazon struck in the hearts of the mainstream retailers.
I think that we will continue to find that many of the most important companies in new areas will be companies like Netscape, Amazon, E-Bay, etc. that have almost no "profits" but have a massive impact on the state and evolution in the cyber economy...thus, for a brief time, they DO justify a market-cap, even without a PE (due to no earnings).
Remember how economists point out that the baby boomers defined the trends...diapers in 50s...music in the 60s....etc. Today we have a generation of young people who may almost never read a book or magazine...but they are on the web...lots of images...call them generation X or whatever...perhaps they are brash and too cool for their shoes....not realizing that money does not grow on trees. Perhaps a good recession will do them good...but their tastes will not change.
We are moving fast forward into the greatest experiment that humanity has ever undertaken...times of great technological development and massive social restructuring. Gold is certainly an important anchor...and certainly will be a fundamental financial ballast, in a world awash on the high seas of change...
But, one thing we must always be wary of....history can be a teacher but it will no longer repeat itself...
My next post will contain an unusual prediction...
"By the way.....on your Master what is money riddle...I am correct to interpret that the master implies that in truth, money is actually nothing more than itself...only it then becomes "what we make of it"???"
I'm not quite sure you're describing precisely the "solution." Real money is far more more important to be just any ol' thing that a pupil might choose to call "money." That's why Aristotle told the pupil that the answer to such a question ("What is money?") would only satisfy the questioner if he were in fact also a Master and could therefore answer his own question. Recall, Aristotle said to the pupil, "When you have a moment to do so, look at it. What you shall see is money."
Aristotle knew that a pupil might indeed look at a great many things and never see money, whereas a master would recognize that in determining what it was specifically that he needed to look at in order to see what money was, he would in fact have answered his own question.
Here is the prediction. (Gold really a bulk item by 2100)
Humans occupy the thin surface of the earth.
The COSTS of tunneling into the earth have always been high, and this isone of the reasons why PMs have remained expensive.
But, considering the amount of space and noise which our roads take up, it makes sense that we seek ways to build low cost tunnels and move transportation underground.
I believe that in the next 25-50-100 years, earth moving technology will evolve.
Imagine a tunneling machine in 2050. It is basically a very large object about the size of a large business hotel. At the end where new earth is being absorbed, it quietly hums away and grinds...in the bowels of the factory, the "valuable" components of the ore are enriched. The "useless" material undergoes a chemical modification which transforms it into "smart materials" which are used to create the tunnel wall at the back end. The walls will be 100 times stronger and just as beautiful as the walls in modern subways. Digging at 50 feet per hour and 120O feet per day or about 100 miles per year, the "value" created by these machines will be the "development" of large tracts of underground space for use as roadways, shopping malls, concert halls, sports facilities, factory space, etc. the side products of these machines will be iron, copper, zinc, gold, silver, etc.
Some of you will laugh at this...but just think it out...we currently go into the ground, get out steel and limestone (concrete), and then ship this all to the city where we build huge buildings and massive roadways...we drive in crowded conditions to work in the middle of one of these buildings (not seeing the light of day). As a contrast, one of the most elegant meals I ever had in Tokyo was in a very beautiful restaurant which was in the underground plaza in the business district. Japanese building companies are already designing massive underground living complexes.
Our technology is going to open up "low cost" development of the underground, and in doing so create unprecedented access to the riches of the mining industry.
Imagine the impact on gold if a region rich in gold ore is chosen as the site for a new sub-terra city....The hundreds of tons per year flowing out of the "excavation" work will hardly be noticed, as all eyes are looking at the way the city is created.
This is still a few years away...but when it is unfolding, then gold history will never repeat itself. (And silver may replace copper as the preferred metal for electric cable.)
Let us say that we take a young fellow (American) and put in one hand a new Sacagawa Dollar and in the other a British Pound (also a brassy object).
Both are substantial. Both are coins. Both are money. But the dollar "feels" more like money in his heart because he knows the coin of his realm.
So, the master realizes that money (no matter how real the coin) is only a proxy for something deep in the human spirit...the willingness to work and the desire to live. Money allows the human mind to go beyond barter...to seek a "common denominator". Money in and of itself is not evil..it is not debased...in fact, it is very noble because it allows a platform upon which human action and interraction can be rewarded...it allows transmutation of material and human energy. In some way, the perfect money is the "philosopher's stone" of the alchemist. It allows lead (human laziness) to be converted into gold (human action).
When the pupil asks "what is money?" he is considering the "spell" that money has over us...his real question is "what is greed?" "What is wealth and not-wealth?".
Harvard economics professor, James Medoff, and Needham, MA, economist, Andrew Harless, have exposed the statistical illusion presented by the BLS in 3rd and 4th quarter productivity figures. They point to two errors in the way Y2K preparations were accounted for in the second half of 1999 and predict the figures for the first quarter of this year - to be released by the BLS May 4th - will be much lower than the market expects.
The findings, summarized in the above link, are as follows:
"Not only did the government statistics exaggerate the output of the computer industry over those six Y2K-obsessed months (for reasons having to do with the way in which computer prices are calculated). They also grossly underestimated the number of hours worked to achieve those results. It was this twin error, that, in no small part, enlarged the legend of the productivity boom and uncorked the newest bottle of speculative moonshine. Rarely has a botched calculation delighted and enriched to many guileless people."
Great reading for those who might have wondered how we could be so productive during the second half of 1999 when so many resources were being siphoned off to address Y2K...
One of many indicators of the coming paper market meltdown.
http://www.usagold.comThis development of the Miyazawa banking bloc could be the door the corporations will direct themselves towards. It means Japan would become the Switzerland of Asia. Using strong currency to leverage their influences and by peaceful means which it's neighbors want to see. A military Japan would scare the little tigers into the US camp so fast. This currency stabilization mechanism including China means US looses influence in the region. We could no longer play one country against another and European lenders would also loose access to deal directly with the tigers but would compete with Japan's offers for loans and support first. Japan becomes lowest bidder on every loan it wants to make by device and design and not only by bid ammounts. It precludes cross alliances and multibillion yen inter-Asian corporate stock swaps thus cementing relationships that before were adversarial. It is the beginning of a Union of Asian States. At the threshold of such a financial shift, Japan would slowly abandone the policy of supporting the dollar and would devalue the yen not by buying dollars but by buying the other worthless currencies of the small tigers. So Japan turns to help its neighbors by supporting their paper. The trend is also a precurser to their decision to begin divesting of assets in the US that could be subject to massive lawsuit attacks as they see happening to our tobacco industry (90's). Courts apply massive liability awards against manufacturers and it drives our industries to Mexico and Canada. All Nafta was about was to make the manufacturing shift a little easier as to taxes and tariff problems.
Pressures of business are like water that pile up and seek a channel to run into. Once they move it cuts a path deeper and wider until it floods the next valley. Japan will find a way out and it probably won't be a big war like what was the excuse to pull US out of its depression. If you realize how much the concept of PEACE is ingrained into the Japanese psyche having been defeated only one time in its whole history and lessons taught were learned well, it leads me to believe they will find a paeceful solution. They still sing corporate songs like we taught them to do in the 50's. The only Achille's heal they have is the vast supply lines that have to be maintained to provide raw materials. One missing ingredient and it all stops, be it oil, coal, ores, pulp, metals, or unique chemicals. So they desperately need to maintain alliances with "resource colonies" but never become too dependent on one. This is where they have failed. They relied on constant revenues from USA and the markets here are saturated. The financing of consumer debt has reached its limits of over-extension.
This Asia Central Bank that Japan wants to support is like doing a "castle move" in chess then they bring out the queen and this would be the unleasing of the yen to soak up and support the worthless paper of the tigers who need the help. As a lioness swats her cubs to get back from danger so this move would be the counter move to a falling dollar and the perils of those stuck holding them. Feel free to add to or subtract from this. I'm just throwing some thoughts around.
Short Gold AND airlines in 2050Solomon Weaver (4/22/2000; 21:12:01MT - usagold.com msg#: 29194)
Here is the prediction. (Gold really a bulk item by 2100)
Solomon: About thirty years ago there was a sci-fi of a future earth where intercontinental transit was via tunnels that descended into the earth parabolically and then curved back up to their destination. Operating as a form of reverse funicular, the gravitational drop of the decent provided the acceleration and momentum to power the return back up, requiring drive power only to overcome friction. Of course there are the problems of enough strength and friction to survive earthquakes and continental drift, but technology has no bounds, yes?
Thank you for rising to my baited question. Your answer was not exactly
what I had expected/baited, but a very adequate and sensible one nevertheless.
I had expected the Master would reply (simply).. "It is PriceLess, Grasshopper, PriceLess.."
You replied (in part):
[quote/snip]
So as you can see, my currency price for Gold is very flexible, and
changes with the changing paper price for a year rent.
If monthly rent were $1, then my Gold price would be $12. If the monthly rent were priced at $500, then the "Aristotle price" for Gold would be $6,000.
As you can see, I feel Gold is undervalued relative to other real wealth by more
than a factor of 12 because as it currently is, one ounce of Gold would not even be adequate to pay a month's rent, far short of the full year I feel would be appropriate.
OK, your turn. Based on what YOU know and perceive, what do YOU feel is your fair parting price for Gold?
[unquote]
So now I must rise to YOUR baited question. (What is MY parting price for Gold?)
My answer: It is PriceLess, Master, PriceLess...
Having said that, isn't it Ironic that the "markets" perceive it so WorthLess.?.
So we have a conundrum of sorts:
If "Money" is *not* Gold....
-and-
Gold is *not* "Money"....
Then why do we/mankind/markets foolishly pretend that it is, and price it so
equally foolishly.?.
Lastly, I'm still awaiting a response from Warren Buffet,
to my baited question to him: "What's HIS Silver price.?."
Have a nice Holiday, Master Aristotle, and May the Bunny Bring You more
Golden (nest)Eggs.
A friend of mine told me about this a few days ago. It might fit in with Trail Guide's trader gold bug vs physical gold advocate.
Here's the deal.
At times the premiums for VF grade $20 Liberty coins and higher grade Double Eagles are very close to the spot price of gold. At other times their premiums are somewhat higher. Today I believe the premiums are in the higher category.
A person could buy regular bullion coins now and wait until the premiums over spot for Libs and DEs fall. When the premiums for the older coins are closer to the spot price he could trade the bullion coins for the older coins.
Then when the premium rises, trade back out of the older coins to the newer coins and have "interest" paid by getting more bullion coins. In this way the gold investor is earning interest by having his pot of gold grow without additional cash outlay.
Solomon Weaver and ThaiGold--haven't we been here before??
Solomon Weaver, your comment--
"I see no value in the stock of Amazon.com, but there has been a lot of "value" created by the "fear" that Amazon struck in the hearts of the mainstream retailers. I think that we will continue to find that many of the most important companies in new areas will be companies like Netscape, Amazon, E-Bay, etc. that have almost no "profits" but have a massive impact on the state and evolution in the cyber economy...thus, for a brief time, they DO justify a market-cap, even without a PE (due to no earnings)."
As Clint Eastwood would say, "That's a high price to pay for being stylish."
On your interpretation of "What is money?," I loved your effort in pursuing the answer to the question, but if I may find any exception with your approach it is that you endeavored to actually ANSWER the question and to define money itself for the benefit of the pupil. Can enlightenment be so easily attained as swallowing a pill crafted by the efforts of another? Hence the simple elegance in my tale--the student attains enlightenment not on being told what money is, but rather upon the realization that the answer given is ABSOLUTE TRUTH, and further, that "the answer lies within."
ThaiGold, thanks for the comment--
"Have a nice Holiday, Master Aristotle, and May the Bunny Bring You more Golden (nest)Eggs."
Allow me to pass along the timely warning I received from my sister--"Beware some of the black "jellybeans" left by the Easter Bunny.
With that, I've got to rest up in preparation of a large family gathering for dinner later this fine day.
I HAD THIS DREAM just now, and it scared me so it woke me up! We were at the grocer's trying to buy a can of soup, and you asked the man, "How much is this?" He said, "That'll be three pounds." I said "three pounds!--For a can of soup!" He said "That's the price today, and you better take it or leave it, Buddy! For there's no telling what it's going to be tomorrow!" So we paid him three pounds and walked out stunned!
I DON'T KNOW WHAT HAPPENED IN BETWEEN, but we must have decided we should leave the country because of the monetary situation. A can of soup for three pounds! So the next thing I knew we were at the railway station trying to buy a ticket, and I was asking him for a return ticket, a round-trip ticket.
"I'M SORRY, WE'RE ONLY SELLING ONE-WAY TICKETS," he said. "We have no idea what the return fare would be later. I wouldn't care if you were returning this weekend, I wouldn't sell you a return ticket because I have no idea what the price will be by then. All we're selling is one-way tickets, and we have no idea what the price will be on returns. We'll sell you a one-way ticket at what it is today, and that's it! And that's for your fare today only. It's got to be used today. We've no idea what the prices are going to be tomorrow!"
SO EVIDENTLY WE DECIDED TO GO TO THE BANK and take our money out-what little we had--for due to this skyrocketing inflation its value was being lost so rapidly, and we were apparently going to leave the country.
ON THE WAY TO THE BANK we stopped to watch this train go by. It was leaving the station and picking up speed as it left, at first starting to roll real slowly and then faster and faster, till soon it was just flying! I didn't understand at first what that meant, but I realise now I was thinking, "It's symbolic of how once the thing starts rolling, the inflation really gets going, it really flies!"
THE POUND'S LOST 10% OF ITS VALUE IN THE PAST WEEK! But it wasn't even in the headlines! Isn't that peculiar? It's down to the lowest it's ever been, now, and the dollar is up the highest it's ever been!--I've got something on that too in a minute.
SO THEN AS WE PASSED ON WE WERE GOING THROUGH THIS JUNKYARD of old scrap iron, and I looked at these piles of old scrap iron on both sides and said, "My, if you can imagine, it's not just the price of gold that's skyrocketing, but even old scrap metal like this is going to be worth a fortune!"
WE GOT TO THE BANK AND THE BANK WAS JUST PACKED WITH PEOPLE standing in long queues at each window waiting to do the same thing, to get their money out. I must have figured I could get quicker action by going to see the manager, and I wouldn't have to stand in the queues, so I went through this door into the manager's office.
IT WAS A DOOR YOU PUSH IN LIKE SOME OF THESE ONE-WAY DOORS do, and it slammed shut behind me. I turned around and I looked at it and thought, "That's funny!" I pushed on it and it wouldn't open, for it just opened inwardly, but it wouldn't open outwardly, and there was no handle on the inside so there was no way I could open the door from the inside. I thought, "My Lord this is just like a trap! I'm trapped in this bank!"
THEN ALL OF A SUDDEN THE WHOLE BUILDING BEGAN TO SHRINK! I thought, "My God, this thing is going to crush us all!" The bank was literally shrivelling, crushing, and the walls were beginning to close in on us! But suddenly there came this voice from above: "Don't worry! The Green Pig is about to explode and it'll blow the bank to bits!" (See "Green Paper Pig," posted earlier on USAGold) And I woke up--Boom! Just like that! It was like a nightmare!
I THOUGHT, "LORD WHAT DOES THAT MEAN?" Then suddenly there dawned on me something I told you before: When those big business financiers, were releasing the Green Pig to chase us down the Jordan Valley, remember it was just a little thing at first? But as it raced down the Jericho road and then down the Jordan it got bigger and bigger and bigger just like a big balloon, till by the time it got almost to us it was like one of those big blimps--a huge parade balloon!
OF COURSE! WHAT DOES THAT SYMBOLISE?--AN INFLATION of the Dollar value! The Green Paper Pig was inflating and getting bigger and bigger and bigger all the time, until suddenly it burst! You understand?--The "Green Paper Pig is about to explode and will blow the bank to bits!"--The monetary system is about to explode and cause the capitalistic financial system to collapse!
BUT I WAS SO SCARED of whatever it was, the idea of the bank blowing up didn't seem to appeal to me much more than the bank collapsing on me! The voice said, "Don't worry! The Green Pig is about to explode and blow the bank to bits!" It seemed the voice came out of the sky like an angel.
WHEN THE GREEN PIG EXPLODED, THAT WAS A SUDDEN INFLATIONARY EXPLOSION OF THE MONETARY SYSTEM!--And what happens?--What followed?--It collapsed!--In total deflation! See? That's a deflation: It just collapsed! Then I was thinking, "I wonder if that has anything to do with the comet and the 40 Days and the destruction of America?"
IMMEDIATELY I SAW THE PRICE OF THE DOLLAR GROWING and growing: The Dollar, the green Dollar, the Green Pig, is literally inflating right now very rapidly. But I was thinking, "Lord, how come America seems to be coming out on the best side of the deal, and the dollar's going up in value? If You're about to destroy America, how come the Dollar's going up?" Well it's inflating, so of course it's going up!
IT'S GOT TO INFLATE BEFORE IT CAN EXPLODE! It would be funny if the Lord destroyed America through its greedy god, the Dollar! There might be an earthquake or bombs or heaven knows what, and it could be that too. But the dollar is definitely inflating and it's got to eventually explode!--And boy, if anything would ever destroy America, that would be it!--And of course it would also destroy the whole world monetary system which is based on that Green Pig! (My comment: today there's a replacement ready to take over and already taking over � the Euro!)
"DON'T WORRY! THE GREEN PIG'S ABOUT TO EXPLODE and it'll blow the bank to bits!" In other words, that is obviously symbolic of an inflation that's so bad that it finally just absolutely explodes and collapses the whole monetary system, and the bank must represent the financial system the banking system and so on. If this happens, it will literally blow the whole world banking system, its financial system, to absolute bits!
IT'LL BE A TOTAL WORLD COLLAPSE OF THE MONETARY SYSTEM which is built on that stupid Paper Pig! See! Isn't that ridiculous? If that little Pig inflates to that point where it explodes, it's going to literally blow their whole monetary and financial systems to bits! If the monetary system explodes, it will literally destroy the financial system. The bank must represent the financial system.
THAT'S WHERE I WOKE UP, and I was thinking, "How come the poor pound has gone down, down, down, and the Dollar's going up?" The answer came to me as clear as anything: It's the Dollar that really has to explode! It will be so inflated in value that it finally explodes! See? The pound has actually gone down in value, which in a way is safer for the pound, believe it or not, than to be inflated like the Dollar is right now. But boy, our friends better get their money into gold or they're going to be sorry!
THEN IT CAME TO ME as plain as anything: "Well, what do you think is doing it? Why is the Dollar inflating?"--This is what's doing it: They are selling out their European currencies and buying Dollars instead! The banking interests apparently are buying Dollars and dumping pounds and European money deliberately to try to hurt England and Europe for the stand they took on the Mideast! So they're dumping their European currencies and buying Dollars to favour their friend America and punish Europe!
THIS FULFILLS EXACTLY WHAT THE LORD SHOWED ME about what they were doing in that dream about the Green Paper Pig! They're releasing the Green Paper Pig and causing it to inflate, you see?--The Dollar! (Maria: But it's their pig.) Yes, it is their pig, but apparently they thought they could control it.
THEY NEVER DREAMED IT WAS GOING TO GO SO FAR, see? They thought it was going to scare hell out of us and cause us some kind of damage. But instead of that I just pointed my finger at it and it went "Poof"! Boom! Exploded! And that was it! They never expected in to inflate to the point that it was going to absolutely explode and be totally destroyed!
THEY REALLY UNLEASHED THAT GREEN PIG ON THE EUROPEANS, SEE?--Because what were we doing in the Green Pig dream?--Europe was crossing the Jordan of decision and the Dead Sea of death to the Dollar to the side of the Arabs in that dream! The Green Dollar Pig is the weapon they are using against the Europeans for siding with the Arabs for oil!
THEY ARE UNLEASHING THIS DOLLAR INFLATION WEAPON against the Arabs and their friends!--You get it? That would include Britain and Europe, whose currencies are going down in relation to the Dollar. The Dollar is expanding, inflating, going up in price, whereas European currencies are going down.
BECAUSE THEY ARE DUMPING THEIR EUROPEAN CURRENCIES AND BUYING DOLLARS! They have precipitated this monetary crisis deliberately, see? That's why the international monetary fund and all those big money boys, the Council of 20 and Council of Ten, etc., have gotten together several times lately to try to agree on a monetary policy, but they flatly refuse--they can't agree on it. The only reason they can't agree is that they don't want to agree!
THOSE WHO CONTROL THEIR PORTION OF THE MONEY which is tremendous, their big banking interests don't want to stop it. They're using the inflation of the Dollar to try to destroy their enemies, including pro-Arab Europe! They know how much money those Arabs have got invested in Europe, and they are trying to destroy not only the Arabs but the Arabs' friends, which would include Europe and Britain.
BUT THE INFLATION WHICH THEY HAVE PRECIPITATED WILL GET OUT OF HAND AND THE DOLLAR WILL EXPLODE AND BE TOTALLY DESTROYED INSTEAD! Instead of becoming a monster that was going to frighten and devour their enemies, when I pointed at it, it exploded!
SO THE DOLLAR IS INFLATING LIKE MAD RIGHT NOW, and when it gets to that point that it explodes, the whole world monetary system will collapse!--And the bankers and capitalists will be left sitting on their stacks of bank notes which will be worthless!
ANOTHER THING WHICH SHOULD HAVE BEEN HEADLINES IN THE PAPER YESTERDAY WAS THE PRICE OF GOLD: It's up to nearly $140 an ounce, the highest it has ever been in history! There wasn't one word in the paper about the fact that the pound had sunk another 10% in a week and that gold had gone up almost another 10%! This shows the Dollar is really not all that valuable, but only better than other currencies. So it began to dawn on me what all this meant, or what it could mean: The soon explosion of the Pig!
THEN I SUDDENLY REMEMBERED THE NEWS THAT RUSSIA HAD JUST ANNOUNCED SHE'S GOING TO CARRY ON ROCKET TESTS in the North Pacific and warned shipping to stay out of the area. I wonder if that has any connection? What could that mean? Why should she be warning shipping to stay out of that area right now, which is near Siberia and Alaska?
WHAT IF RUSSIA WERE PLANNING TO TAKE ADVANTAGE OF THE SITUATION, knowing somehow that America's monetary system was about to collapse and therefore weaken the whole country? If the Dollar collapsed America would absolutely collapse! When she collapsed financially, she'd be in a state of absolute chaos!
THAT WOULD BE THE SMARTEST THING IN THE WORLD TO DO, TO TAKE ADVANTAGE OF AMERICA IN A STATE OF COLLAPSE and absolute chaos for an invasion! The logical way for Russia to invade, of course, the way that Americans have always been afraid she was going to invade, is the shortest possible route right through Siberia right across the Bering Straits into Alaska and down. Now that's quite possibly what Russia has in mind!
BUT HOW COULD THAT AFFECT THE MIDEAST? Well of course, dying America in its last desperate death struggles, what would it do? What was causing it to collapse? If her money had collapsed and she was out oil, what would become the only valuables in the world?
IF AMERICA'S WHOLE SYSTEM WAS COLLAPSING AND SUDDENLY GOLD AND OIL HAVE BECOME THE ONLY THINGS THAT ARE WORTH ANYTHING, the only commodities with standards of value and usefulness, what would the Americans do as a last act of desperation? Dying America would do what?
AMERICA WOULD TRY TO ATTACK THE ARAB COUNTRIES AND GRAB THE OIL AND THE GOLD! Whatever super power possesses and controls those Arab countries would have all the oil and they'd have most of the gold too, and they would have what would be the most valuable things in the world at a time of crisis like that!
SO THE EXPLOSION OF THE GREEN PIG, THE MONETARY SYSTEM, COULD CAUSE THE MIDEAST TO EXPLODE. I have always theorised that it was because of the Arab defeat that they were the ones who would get desperate and start doing the shooting. But the reason we saw the Arabs in our vision doing the shooting could be because they realised or had intelligence that America was about to attack, so they just started attacking first, and then everybody started shooting because they were all prepared for it anyhow.
40 DAYS! 40 DAYS, BY THE WAY, IS THE TIME ALLOTTED FOR THE ISRAELI DISENGAGEMENT FROM THE EGYPTIANS. 40 Days! Russia is smart enough to see what's happening or about to happen--and, who knows, she may even be helping to engineer it! Russia has long sought to engineer the collapse of the capitalistic system. What better way to help the collapse of the capitalistic system than to explode its monetary system and its banking system, its whole financial system?
SO THE RUSSIANS MAY BE GOING TO TAKE ADVANTAGE OF THE SITUATION TO ATTACK A WEAKENED AMERICA. What a perfect preparation for any proposed rocket attack on America! The Money Explodes! The Dollar Explodes! Inflation Explodes!--And War Explodes!
THE LORD APPARENTLY GAVE ME THE DREAM TO WARN US THAT THE PIG IS ABOUT TO EXPLODE and is going to destroy the monetary system and with it the financial system, and with it virtually the whole capitalistic system; and Russia is probably preparing to take advantage of situation to destroy America.
AMERICA IN ITS LAST DYING DESPERATE HOURS IN VERY LIKELY GOING TO EXPLODE IN THE MIDEAST and try to grab the oil and the gold to save herself. As a result, America and Russia would be going to war and destroying each other, which would work out just like we have seen it before.
THEN CHINA, EUROPE AND THE POOR NATIONS OF THE THIRD WORLD COULD TAKE OVER: THAT'S THE HAPPY ENDING! So praise the Lord! Boy I tell you, we are without excuse! The Lord has warned us so much!
The above letter was written January 24, 1974 by Father David. I don't know how many people saw it this way back then! There is a tremendous correlation between what has been said on the forum lately and what we find in this letter written 26 years ago. God likes to give us early warning! The time is getting shorter!
You guys, this one must be worthy of the hall of fame, especially considering it was written in 1974!
Hello. I am looking at analysus that focuses on possibility that Euro's downtrend portends value crises of this currency. It seems that all the prognostications of the dollars future are what is exactly happened to the Euro. Since its inception it has steadily lost value, and now appears at the crossroads to go down more.
This it semms is the only major currency arena where the price of gold is in a bullish uptrend. In a world already saturated with debt financed stuff, it seems any fundamental competative advantage of lower Euro, will still net out very negatively against increased costs for oil,electricity,etc., in Euroland.
Can you give any insights into the market dynamics that are at work right now that are constantly weakening the Euro?
Thankyou for any reply.
This is only my opinion. Price action in Newmont could portend that they are going to be the first to get the aquisition-consolidation band-wagon going. Time has come for the big outfits to acquire cheap reserves. Subtle action in Battle-Mountain may mean it is going to be one of the first to "go". Barrick in keeping with their grandstanding manipulating are probably going to pull off something spectacular. Big pigs eat first.
I still stand by my prediction of several weeks ago, that if big paper gold market manipulators take gold down into all new low prices, it will unleash an organic turmoil to the very foundations of what is wealth.
http://www.egroups.com/message/gata/437? It looks like there is an error in the stated amount of gold exported. Murphy is claiming a fantastic high number of tonnes exported, where the numbers are really dollar figures.
http://www.msnbc.com/news/398444.aspThe Chinese say that a picture is worth a thousand words. 131 Feds (storm troopers) without a warrant burst into a home and terrorize the occupants. What will happen if they decide your property is really theirs? "Warrant? Warrant? We don't need no Stinkin' Warrant!!!"
Ari? Trail Guide? Michael? Oro? Aragorn? Town Crier? Knights? Ladies?
Are there any websites that show gold's price in all world currencies? Or can anyone quote Friday's gold prices, for example, comparatively in the world currencies?
I'm wondering if the comparison will show gold higher in other countries' currencies compared to the American price in dollars. And alongside the price of gold across the world, I'm wondering if another comparison of the world currencies themselves, will show a correlation between a rise or fall in a particular country's currency rate and the rise and fall in their local price of gold.
If America is dumping other currencies and buying their own dollar to push the dollar higher and to punish countries for the Washington Agreement by making the currencies of those countries fall and the dollar rise, then
it seems that it would reflect in the comparisons above or maybe in comparing these prices to bond prices???? I'm not sure what comparisons would show what I'm looking for.
It also seems to me that America is taking the BIS bait, hook, line and sinker so in the end America will hold nothing but their debt-filled dollars which seems like the workings of the old proverb, "And you will reap what you sow."
I wonder how America can be so blind. Or is it helpless to stop it's inevitable bankrupcy? Isn't it kind of like the American Civil War Confederacy buying up Confederate dollars trying to punish the Federals at the end of the war?
From what I gather from the thoughts so freely given here, this process cannot be stopped and can only be manipulated for a while longer before it's time "to pay the Piper."
I don't fully understand how America manipulates their price of gold. Do they sell their gold at 9:00 AM in New York everyday to get the price down? Or do they buy lots of dollars and make the currency rate rise so no one will panic and buy gold???
According to their online poll, the vast majority of MSNBC web page readers believe it is OK for the government to kick in doors and point automatic weapons at people.
It may be time to begin preparations on living arrangements outside the USA.
Someone once said concerning the apathy of the people in Nazi Germany:
They came for thee,
They came for me,
and they came for you behind the tree.
I have friends who have moved to Lake Chapala, Mexico, and others who went to Costa Rica, and Belize. They went for retirement and tax purposes, maybe they are on to something!
(What does this pile of garbage tell us?) The wilderness is full of sights and noises. Tracks tell the story of events that transpired while no one was there to hear the sound of that falling tree everyone wonders about. Modern men rely almost soley on packaged news, caring very little to deciper the tracks all around them to tell them the true story. Despite all the camping gear, we don't get to the widnerss much.
Has anyone noticed the explosion in construction of mini-storage units? Taken by itself, this one sign would lead one to believe that times are prosperous. But, given a negative 2% rate of savings, why is everyone caught up in the exercise of buying things they obviously don't have much use for?
If the goods are not needed, why not give them away?
Why pay $60 per month to keep a bunch of stuff four miles from home? I drive past these places. They are usually deserted. Occasionally one will glimpse sight of someone unloading a moving van, but there aren't that many people moving. Mostly it is just rented storage for things we had to have, and now don't have room for. They have to be stored now because there is no longer space at home. The space has been allocated to more new stuff we had to have. It reminds me of the bit Geore Carlin used to do about having so much "Stuff". It was funny then. Now it seems sad. I am rarely amazed anymore. We really have gotton that far off of the path.
How much stuff per capita, do you suppose we Americans have sitting in rented mini-storage units? Just sitting there, molding, while we go out and work like men possessed, so we can buy more. If we really had the good sense to store our wealth, we would sell all that garbage, pocket the rent, and buy GOLD! Which, by the way, is much easier to store.
I guess there is one tactical advantage to mini-storage. It should keep the looters out of the residential neighborhoods for a few days. I hope nobody reading this has any extra food or ammo stored in one of these joints. Go through the list. What will you need if there is an emergency? Go get that stuff, today. Keep it close at hand. Sell the rest and buy gold real soon. (Put it in the freezer, inside a fish frozen in a block of ice.)
Maybe if you keep gold in a large gun safe that is buried under all that "stuff" in one of those storage units, then when the Storm Troopers come to your home, they don't find anything. Just use an assumed name and address for the rental and keep paid up in advance. Booby traps are a nice fashion statement as well ;-)
http://pacific.commerce.ubc.ca/xr/plot.htmlSet the base currency to "Gold Ounce" and you can choose any target currency. If you want to plot more than one simultaneously, hold down the CTRL key while selecting your target currencies.
After thinking on this issue yesterday, I have to say that there seems to be some confusion about what is happening in the gold paper markets and what is likely to happen in the future.
As manipulated as the paper markets are, they CANNOT go to zero...in reality, they can't even go too far below where alternative distribution sources are priced or where demand in general becomes too great. Why not? It's called a put. Puts give the buyer the right, but not the obligation, to buy the lot at a set price. So, for instance, if COMEX prices fell to $249.50, a June 250 Put would be "in the money" and Goldman Sachs would STILL have to anty up the gold.
Two conclusions can be drawn here...first, it's obvious that alternate distribution systems are not yet significant or are not pricing gold significantly above the current paper price...if they were, you could buy gold through puts and sell on the alternative market at a tidy profit. The second conclusion is that Goldman Sachs and crew should be trying to keep the paper price within a narrow range in order to protect against both calls AND puts. Well, that's exactly what is happening...$280 or so on the downside and $290 on the upside. This is the only real way they can hope to protect calls currently written without creating too many IMMEDIATE problems with the puts they are selling.
It's only fitting that Nasdaq's biggest one-day drop ever occurred Apri 14th, the day the CPI "shocked" Wall Street. (Of course, we cognoscenti here at the Forum had discussed the inflation which was coming months before the fact). Now, some who never saw inflation's approach are trying to tell us it will be nipped in the bud by a combination of higher interest rates and a chastened OPEC. Don't you believe them.
Oil prices are still double what they were a year ago, and the ripple effects across the economy are only now showing up in the so-called "core rate". Meanwhile, the Fed's policy of allowing money growth on the one hand, while tepidly raising interest rates on the other, has been in place for over 6 months and is just as big a failure as we said it would be. Consider this: Last week, the number of Americans filing new claims for unemployment benefits fell to 257,000 from a revised 266,000 the week before. The four-week moving average of claims, which generally provides a more accurate picture of jobless trends, was reported at 262,500, the lowest since 256,000 was reported in December, 1973!!! And in 1973, another period of growing inflation, BTW, the economy was much smaller than it is today.
Only pure inertia has restrained wages to this point. Soon, wage demands will bust loose, and hard-pressed employers will have little choice but to concede to the demands of their workers.
Meanwhile, inflation has in the past acted upon the stock market like kryptonite. Just witness the 1970s. Today's investor need only ask, where will all that IRA money be going next?
Which brings us back to square one! Are these conversion rates accurate? Can they be manipulated?
According to information gathered here(USAGOLD archives) the BIS sets a Gold dollar value in(BIS)Gold Francs, therefore if using dollars as a base currency set to a fixed amount of Gold at the Bank for International Settlements, the world is on a Gold standard. However only top CB bankers and Goldhearts know this.....see some of Sir ORO's and FOA/Trail Guides past works.
.....beesting.
US stock market saved and gold trashed by a collapsing Euro. Those on this thread who have said again and again that the Euro was preparing to challenge the dollar for global supremacy could not have been more wrong.
After reading and digesting TG's analysis ( God knows, for how many times!), some questions arise:
TG's main point ( or hypothesis ) is that the parties with vested interests of keeping the paper gold price down are supplying vast supplies of paper gold to the market ( COMEX,LBMA ), and not enough real goldbugs (physical gold advocators) are pressing for delivery. Therefore, the scheme can go on and on, until a major reserve currency collapses ( my interpretation of Trail Guide, sorry if not accurate ).
But according to many numbers, yearly physical gold demand outstrips the supply by roughly 1000 tons. Also according to consensus here in this forum, all the CB's net gold selling in the last several years are minimal. So where is all this stealthy, but PHYSICAL gold coming from? Are all the buyers of physical gold ( Taiwan, China, India...and big players in the know ) are told not to purchase physical gold from COMEX,LBMA but through other channels in order to support the big scheme?
The Bis now has two offices:
Centralbahnplatz 2, Basel, Switzerland.
8th floor,Citibank Tower,3,Garden Road,Central Hong Kong.
Special Administrative Region of the People's Republic of China.
The Gold Franc of the BIS has a Gold weight of just over 0.29 Grams of fine Gold, etc. etc.
The BIS employs the Gold Franc solely as a unit of account for balance sheet purposes, assets and liabilities in U.S. dollars being converted into Gold Francs at the FIXED RATE of U.S. $208.00 per ounce of fine Gold(approximately equivalent to 1 Gold Franc = U.S.$1.94) and all other items in currencies BEING CONVERTED INTO GOLD FRANCS ON THE BASIS OF MARKET RATES AGAINST THE U.S. DOLLAR!!
Re --
>>> Puts give the buyer the right, but not the obligation,
to buy the lot at a set price. So, for instance, if COMEX prices fell to $249.50, a June 250 Put
would be "in the money" and Goldman Sachs would STILL have to ante up the gold.<<<
That's what a CALL does. A put gives the holder the right to SELL at the strike price. The writer of the Put is obligated to pay that price to the holder even though the current market price is lower. (The holder has the right to "Put" the gold to the writer at strike.) The fact is that Puts actually have a braking effect on a falling market because they force the writers to be new buyers (If in the money at expiry).
However, if the Put writers, who probably wrote mostly against margin credit, don't have the money in hand; then you have the defaults and that would be our "Burning of Paper Gold!"
Very true...a written put gives the OBLIGATION to purchase physical at the price of the contract and a put purchased (long put) allows the RIGHT to sell physical. My fault for switching to two in my example, but the end result is the same....
Paper prices too far below true supply and demand will bring about a storm of written puts sold...and therefore physical gold still changes hands. Today's narrow range market actually keeps speculators from buying calls or puts...lack of momentum is the death knell for speculators.
Puts and Calls on commodity futures are rights and obligations to enter futures contracts. That is, if I buy a put I have the right, but not the obligation, to enter into a futures contract to sell.
If the futures have been "force majeured" into cash settlement then I will be relieved of my obligation to deliver physical and can settle with cash paper.
Calls deal with the buy side. If I purchase a call then I have the right, but not the obligation, to enter into a futures contract to buy at the strike price. Again, if the market has gone to cash settlement then I will be unable to call for physical delivery.
Historical note: Options contracts were invented during the tulip mania of the 1630's as a way of increasing leverage.
http://www.usagold.comA few miners walked into the sheriff's office looking a little paranoid. Sheriff says, "Whats the matter with you?" Well, we're scared. We have a few hundred pounds of gold dust and we have no place to store it with any sense of security. We were wondering if you could hire some deputies and sort of guard it for awhile. We can pay you for your help. Sheriff agrees. Sounds like this could be mutually profitable.
So the miners leave and decide to expand their mining operations. They want to buy supplies but they have no money. So they talk the store owner into accepting a promise that he can go down to the sheriff's office and take 3 ounces of gold dust anytime he wants to. "Well I need something in writing so when you guys leave and go out and get drunk that you don't change your minds." "OK so will our signatures be enough if we all agree and sign." Sure.
So the miners become well known as the store owner redeams his (gold backed promissary note)at the sheriff's office for the actual gold promised. As they go through the town every store owner wants to sell them merchandise for their promissary notes issued against physical gold held at the sheriff's office. The miners realize that no one is keeping track of how much gold has actually been promised and they haven't found any gold in months but no one in town knows this. They wonder, "Have we written more promissary notes than we have gold". Yes they have and they know it but alot of store owners are satisfied to pass the paper promise IOUs on to others because redeaming the notes for the quantities of gold involved is too risky with all the bandits around. So the miners still have good credit as long as there is a good supply of notes kept from being redeamed.
Problem is that they need to borrow alot more than they can write gold backed IOU's without creating a panic at the sheriff's office for people who realize there is an overabundance of IOU's written. They could start a faith crisis.
So they take their problem to a lawyer who refers them to a businessman from New York who retells the same story to them and how he solved the problem. "The problem is that you guys look too scrubby for any one to trust, face it you need some polish." They all agree, the mine is about to disband if they don't restore faith in all these IOU's written. The businessman proposes that they all become partners and start a bank. A big nice white marble facade with pretty tellers and a telegraph wire to the East. Wow this is great. One problem though. No one knows just how many ounces of gold have been promised by these miners. So they make a deal. With the little amount of gold they do actually have on hand they will write up Reciepts and number them associating one reciept for one ounce, and the bank promises that any miner can deposit his gold dust at the new bank and get a reciept that he can show to others proving that he really does have gold at the bank. It was like a promissary note but is now backed by a bank that looks like a bank and it's a big marble building that everyone trusts in. The miners agree it is the only solution and since there were way too many promises written on the gold at the sheriff's office they decide to default on their promises. They pay the sheriff to pay the accountant to leave town. They put a little bit of gold dust in the safe and let the rumor out that "The new bank refuses to accept the promisary notes written at the sheriff's office because the accountant ran off with the money." Big panic at the sheriff's office. Store keepers violently upset. Want to kill the miners. Poorman gets wiped out for NOT holding physical gold. The miners blame the accountant and wipe their brow hoping everyone would just take the same loss they all have and go away. Now the new bank is accepting gold dust for deposit and the back room is filling up with gold. They get a wire from New York asking how things are going. "Well we paid for all the marble out front and we are pileing up pounds of gold dust. No one ever comes in to get their dust as they only want coins and we don't have any coins hardly, so we issue bearer on demand notes. Anyone coming in can redeam these notes for gold coin but we never have enough coins so no one does." Word comes back,"Well send all that dust over to the Federal Treasury and get a receipt plus what coins you need at the mint."
So the little good mining town bank gets a receipt and enough coins to satisfy the few people who come in to redeam their notes backed by physical gold.
But the New York office sees greater potential for the small town "savers" bank. They want to make big loans at "interest". So the new accountants arrive, young and ambitious real money changers. They transfer the old managers for being "too conservative" "failing to earn enough". The miners wonder what is going on, things were fine before and their old buddy bankers got a "sudden promotion". But all goes well for now. Then the new accountants start loaning out money like crazy at low interest. The miners get way too far in debt. The bank has them sign many legal statements guaranteeing payments for the loans. The mine goes under, forced to sell out to the bank. The bank takes over the mine and has no idea how to run it. So they hire the miners back but leave the old owners out. The miners are upset without the old owners who knew how to run a mine. Union problems start up. No gold is coming out of the mine. The people start to move away. As they pull their money out of the fine marble front bank they notice how the bank has stopped issuing loans and has started demanding payments from people they used to allow time to. New York took the Federal Gold Receipts and thet got mailed back East to write loans on. The Regional Merchants Bank with the white marble front is in trouble without those receipts for physical gold that the main office wrote loans on. People are demanding the physical gold for the many years the bank was writing them. Now the regional merchants bank has become like the old sheriff's office. A run has developed into a panic. No problem if you have any physical gold you can deposit it in this new bank and these receipts are now accepted all over town. Those old notes are worthless. So the miners now bring their gold dust in and get told the same story "These coins are hard to get and too heavy to be carrying around, we can pay you interest if you leave the gold here and accept these new trustworthy gold bearer notes. These notes are really backed by gold, we are new and we aren't crooked like that last bank."
Then the store keepers are broke but able to borrow all they need with this new bank that just opened up.
That scenario is what led early economists to predict the boom bust cycles as the ocurred whether people predicted them or not. Once the big banks plundered the small country savers banks then the cycles became wider, deeper, and meaner. Panics led to depressions where all faith was wiped out as chronic unbelief set in. Gold in America was always seen as "the stuff you show people" so you can write loans on it. In Europe with so many wars going on so often the gold was "the stuff you hide for the family" and you trade with merchandise the other people need, not the gold. Gold receipts were not well trusted in Europe and people prefered payments in actual metal with a past history of banking defaults going back hundreds of years. America is a new country to this day with almost no history as 200 years is as a weekend to other culture's historys. Is our general population dumber than a box of rocks when it comes to gold..........just ask anyone, anything, anytime, even at a university. 30% of our population is sedated on drugs wether legal or illegal at ant given time, 25% cannot read this. What percent is too busy working to know the difference?
Finally the people in the US were tired of being wiped out every 15 years or so. So they voted for the Federal Goverment to issue bearer notes and at only a 1 to 1 ratio for gold on hand. So then the regional banks cried to use silver for their promissary games. So that went the same way until merchant banking was outlawed. As I see it, each solution has only extended the boom-bust cycles out to a farther point in time. The day of reckoning gets prolonged but each bust gets deeper and meaner.
I don't accept the Ravi Batra theory because we are not dealing with linear quantities. Wave theory is about just that, waves. The volume of water difference between a wave 10 ft high vs. a wave 20 ft. high is not 1:2. The thickness of the wave is so easily overlooked yet it represents a massive volumetric difference. The 20 ft wave could have 3 or 4 times the amount of water in it. Their is no mathematical economic model that can adequately describe this. I can give you a high thinned out wave 20 ft high or I can give you a solid thick 20 ft. high wave. What type of wave do you think we are dealing with here today seeing these volumes of shares and contracts churning? The top wave up since Oct is the puff that came off but it rides on a massive pre 1995 wave that has not broken. Rising interest rates may be likened to the very low water around your ankles before the wave breaks as all the water has been sucked up into the wave. This churning top of the past three weeks is the froth at the top It's only my opinion and it's right!
So the morals of the story are endless. Paper gold is quick and conveniant, safe to pass on to others, but ALWAYS goes into default with the over-extension of credit at some point in time. The reckless nature of mankind messes it up. The papergold people always argue how they can make tranactions quickly without danger of robbery, but they always feel a little shakey about the quality of what they have. It's musical chairs and they must keep their eyes on a chair to sit in at all times. Ownership risk is preferred to slowness of selling and storage risks.
The physical gold owners have no ownership risk as they know it's real and can limit their storage risks, but they know the big banks really want their gold and will try to pass laws to take it if it becomes too valuable. Paper gold is a form of trust that is written on gold the big banks say they own. Again, they always write way too many reciepts for what they actually have. With computers today all commodities markets are expanding as more people enter these casinos. A futures contract is only worth what it is redeamable in. When the Palladium futures contract says "Redeamable in cash only" then it is no longer a paladium futures contract. Same situation would occur in the gold futures casino. As the value of the dollar would fall so the value of the gold contract would fall as well while its metal value rose, leading traders to say" It's worth it now to pay storage fees to trade contracts that say "redeamable in physical gold"." Then no one wants the cash redeamable calls and the contracts fade away with the lack of demand. A reciept for gold actually matching the physical supply when held by a trustworthy bank is also physical gold as it is honestly represented. Problem is that the keepers lie.
Only the miners who hid their own gold were protected from the thieves in town and in the thieves in banks throughout their life. The lure of commerce and profits leads to the "paper gold is better" theory.
It would be likened to unlocking the power of gold, man's faith in its enduring value being put to use. With the use of computers to skim profits from small price movements papergold is popular but high risk.
The arguement of physical vs paper is the difference between the tree lovers and the lumberman. One likes nature that's beautiful honest and right. The other is tired of living in a tent and needs a 2X4. Enjoy the tree but don't worship it or condemn me for cutting one down to build you a house.
-$5 Indian
http://www.usagold.comA few miners walked into the sheriff's office looking a little paranoid. Sheriff says, "Whats the matter with you?" Well, we're scared. We have a few hundred pounds of gold dust and we have no place to store it with any sense of security. We were wondering if you could hire some deputies and sort of guard it for awhile. We can pay you for your help. Sheriff agrees. Sounds like this could be mutually profitable.
So the miners leave and decide to expand their mining operations. They want to buy supplies but they have no money. So they talk the store owner into accepting a promise that he can go down to the sheriff's office and take 3 ounces of gold dust anytime he wants to. "Well I need something in writing so when you guys leave and go out and get drunk that you don't change your minds." "OK so will our signatures be enough if we all agree and sign." Sure.
So the miners become well known as the store owner redeams his (gold backed promissary note)at the sheriff's office for the actual gold promised. As they go through the town every store owner wants to sell them merchandise for their promissary notes issued against physical gold held at the sheriff's office. The miners realize that no one is keeping track of how much gold has actually been promised and they haven't found any gold in months but no one in town knows this. They wonder, "Have we written more promissary notes than we have gold". Yes they have and they know it but alot of store owners are satisfied to pass the paper promise IOUs on to others because redeaming the notes for the quantities of gold involved is too risky with all the bandits around. So the miners still have good credit as long as there is a good supply of notes kept from being redeamed.
Problem is that they need to borrow alot more than they can write gold backed IOU's without creating a panic at the sheriff's office for people who realize there is an overabundance of IOU's written. They could start a faith crisis.
So they take their problem to a lawyer who refers them to a businessman from New York who retells the same story to them and how he solved the problem. "The problem is that you guys look too scrubby for any one to trust, face it you need some polish." They all agree, the mine is about to disband if they don't restore faith in all these IOU's written. The businessman proposes that they all become partners and start a bank. A big nice white marble facade with pretty tellers and a telegraph wire to the East. Wow this is great. One problem though. No one knows just how many ounces of gold have been promised by these miners. So they make a deal. With the little amount of gold they do actually have on hand they will write up Reciepts and number them associating one reciept for one ounce, and the bank promises that any miner can deposit his gold dust at the new bank and get a reciept that he can show to others proving that he really does have gold at the bank. It was like a promissary note but is now backed by a bank that looks like a bank and it's a big marble building that everyone trusts in. The miners agree it is the only solution and since there were way too many promises written on the gold at the sheriff's office they decide to default on their promises. They pay the sheriff to pay the accountant to leave town. They put a little bit of gold dust in the safe and let the rumor out that "The new bank refuses to accept the promisary notes written at the sheriff's office because the accountant ran off with the money." Big panic at the sheriff's office. Store keepers violently upset. Want to kill the miners. Poorman gets wiped out for NOT holding physical gold. The miners blame the accountant and wipe their brow hoping everyone would just take the same loss they all have and go away. Now the new bank is accepting gold dust for deposit and the back room is filling up with gold. They get a wire from New York asking how things are going. "Well we paid for all the marble out front and we are pileing up pounds of gold dust. No one ever comes in to get their dust as they only want coins and we don't have any coins hardly, so we issue bearer on demand notes. Anyone coming in can redeam these notes for gold coin but we never have enough coins so no one does." Word comes back,"Well send all that dust over to the Federal Treasury and get a receipt plus what coins you need at the mint."
So the little good mining town bank gets a receipt and enough coins to satisfy the few people who come in to redeam their notes backed by physical gold.
But the New York office sees greater potential for the small town "savers" bank. They want to make big loans at "interest". So the new accountants arrive, young and ambitious real money changers. They transfer the old managers for being "too conservative" "failing to earn enough". The miners wonder what is going on, things were fine before and their old buddy bankers got a "sudden promotion". But all goes well for now. Then the new accountants start loaning out money like crazy at low interest. The miners get way too far in debt. The bank has them sign many legal statements guaranteeing payments for the loans. The mine goes under, forced to sell out to the bank. The bank takes over the mine and has no idea how to run it. So they hire the miners back but leave the old owners out. The miners are upset without the old owners who knew how to run a mine. Union problems start up. No gold is coming out of the mine. The people start to move away. As they pull their money out of the fine marble front bank they notice how the bank has stopped issuing loans and has started demanding payments from people they used to allow time to. New York took the Federal Gold Receipts and thet got mailed back East to write loans on. The Regional Merchants Bank with the white marble front is in trouble without those receipts for physical gold that the main office wrote loans on. People are demanding the physical gold for the many years the bank was writing them. Now the regional merchants bank has become like the old sheriff's office. A run has developed into a panic. No problem if you have any physical gold you can deposit it in this new bank and these receipts are now accepted all over town. Those old notes are worthless. So the miners now bring their gold dust in and get told the same story "These coins are hard to get and too heavy to be carrying around, we can pay you interest if you leave the gold here and accept these new trustworthy gold bearer notes. These notes are really backed by gold, we are new and we aren't crooked like that last bank."
Then the store keepers are broke but able to borrow all they need with this new bank that just opened up.
That scenario is what led early economists to predict the boom bust cycles as the ocurred whether people predicted them or not. Once the big banks plundered the small country savers banks then the cycles became wider, deeper, and meaner. Panics led to depressions where all faith was wiped out as chronic unbelief set in. Gold in America was always seen as "the stuff you show people" so you can write loans on it. In Europe with so many wars going on so often the gold was "the stuff you hide for the family" and you trade with merchandise the other people need, not the gold. Gold receipts were not well trusted in Europe and people prefered payments in actual metal with a past history of banking defaults going back hundreds of years. America is a new country to this day with almost no history as 200 years is as a weekend to other culture's historys. Is our general population dumber than a box of rocks when it comes to gold..........just ask anyone, anything, anytime, even at a university. 30% of our population is sedated on drugs wether legal or illegal at ant given time, 25% cannot read this. What percent is too busy working to know the difference?
Finally the people in the US were tired of being wiped out every 15 years or so. So they voted for the Federal Goverment to issue bearer notes and at only a 1 to 1 ratio for gold on hand. So then the regional banks cried to use silver for their promissary games. So that went the same way until merchant banking was outlawed. As I see it, each solution has only extended the boom-bust cycles out to a farther point in time. The day of reckoning gets prolonged but each bust gets deeper and meaner.
I don't accept the Ravi Batra theory because we are not dealing with linear quantities. Wave theory is about just that, waves. The volume of water difference between a wave 10 ft high vs. a wave 20 ft. high is not 1:2. The thickness of the wave is so easily overlooked yet it represents a massive volumetric difference. The 20 ft wave could have 3 or 4 times the amount of water in it. Their is no mathematical economic model that can adequately describe this. I can give you a high thinned out wave 20 ft high or I can give you a solid thick 20 ft. high wave. What type of wave do you think we are dealing with here today seeing these volumes of shares and contracts churning? The top wave up since Oct is the puff that came off but it rides on a massive pre 1995 wave that has not broken. Rising interest rates may be likened to the very low water around your ankles before the wave breaks as all the water has been sucked up into the wave. This churning top of the past three weeks is the froth at the top It's only my opinion and it's right!
So the morals of the story are endless. Paper gold is quick and conveniant, safe to pass on to others, but ALWAYS goes into default with the over-extension of credit at some point in time. The reckless nature of mankind messes it up. The papergold people always argue how they can make tranactions quickly without danger of robbery, but they always feel a little shakey about the quality of what they have. It's musical chairs and they must keep their eyes on a chair to sit in at all times. Ownership risk is preferred to slowness of selling and storage risks.
The physical gold owners have no ownership risk as they know it's real and can limit their storage risks, but they know the big banks really want their gold and will try to pass laws to take it if it becomes too valuable. Paper gold is a form of trust that is written on gold the big banks say they own. Again, they always write way too many reciepts for what they actually have. With computers today all commodities markets are expanding as more people enter these casinos. A futures contract is only worth what it is redeamable in. When the Palladium futures contract says "Redeamable in cash only" then it is no longer a paladium futures contract. Same situation would occur in the gold futures casino. As the value of the dollar would fall so the value of the gold contract would fall as well while its metal value rose, leading traders to say" It's worth it now to pay storage fees to trade contracts that say "redeamable in physical gold"." Then no one wants the cash redeamable calls and the contracts fade away with the lack of demand. A reciept for gold actually matching the physical supply when held by a trustworthy bank is also physical gold as it is honestly represented. Problem is that the keepers lie.
Only the miners who hid their own gold were protected from the thieves in town and in the thieves in banks throughout their life. The lure of commerce and profits leads to the "paper gold is better" theory.
It would be likened to unlocking the power of gold, man's faith in its enduring value being put to use. With the use of computers to skim profits from small price movements papergold is popular but high risk.
The arguement of physical vs paper is the difference between the tree lovers and the lumberman. One likes nature that's beautiful honest and right. The other is tired of living in a tent and needs a 2X4. Enjoy the tree but don't worship it or condemn me for cutting one down to build you a house.
-$5 Indian
Putting two posts together .......maybe getting an answer
From another site,
----------------------------------------------------
>From January through August 1999, official U.S. gold
exports of gold averaged around 220 tonnes per month.
In September they rose to 976 tonnes, in October 400
tonnes, in November 1008 tonnes, in December 783
tonnes, in January 727 tonnes, and February 921 tonnes.
Two to three hundred percent increases in U.S. gold
exports! Why the sudden need to pull gold from the
United States into the physical market?
The story becomes more intriguing. This gold is
reported as non-monetary gold. I spoke to almost no one
who understood that. It is GOLD COMING OUT OF THE NEW
YORK FEDERAL RESERVE BANK. It IS monetary gold, not
gold coming from mine production as one would think.
--------------------------------------------------------
You're assuming that those who accept the paper certificate for the gold maintain their view that it is the same as physical. This view is changing now. The higher level of gold exports does have historical precedence. It happened in 1930-31 and in 1970-71.
The foreign creditors, mainly European, are insisting on physical delivery leaving American banking institutions holding the paper.
All, it's history in the making, and it's happening right before our very eyes. The flight from the dollar has begun.
---------------------------------------------------------
The confusion comes from the different views of what constitutes gold. If one goes to a bank and "buys gold" but accepts a certificate in lieu of physical, then have they really bought gold? The answer is no, but many view it differently. This represents the basic difference that FOA points out between the "trader gold bug" and the "physical gold advocate."
Physical gold advocates believe that there is no substitute for holding physical metal.
Trader gold bugs believe, in part, that holding a certificate is adequate because they are concerned more with the paper price of gold rather than gold's status of an item of wealth.
We see today with the increasing amount of gold being exported from the US that foreigners are more and more insisting on physical metal. This can only mean one thing: The run on the dollar has started.
. http://www.usagold.comS&P falls hard on 6:30 opening--anybody hear anything or are the "taxi cabs of absolute reality" merely catching up with the U.S. credit bubble?
In My Humble Opinion a decimal point was missing in all the Gold figures listed in Mr. Murphy's 437 GATA message.
U.S. Gold mines are second to South Africa in annual Gold production, from Gold Fields Mineral Services:
The U.S. produced 354 tonnes of Gold in 1999.
So, lets insert a decimal point before the last diget in all the numbers in Mr. Murphys 437 message to get a slightly more accurate figure.
220 tonnes becomes 22 tonnes.
22 tonnes times 8 months = 176 tonnes(Jan.1999 to Aug.1999)
1999 total approximate amount from figures released:
176 tonnes Jan-Aug.
97.6 tonnes Sept.
40 tonnes Oct.
100.8 tonnes Nov.
78.3 tonnes Dec.
_________
492.7 Total U.S. Gold exported in 1999 the 138.7 tonne difference between 354 tonnes mined and 492.7 tonnes exported may be from melted scrap Gold and other hoards sold in 1999.
Now, lets add the amounts from Sept.(signing of Washington agreement)1999 to Feb. 2000.
Sept. 97.6 tonnes
Oct. 40 tonnes
Nov. 100.8 tonnes
Dec. 78.3 tonnes
Jan. 72.7 tonnes
Feb 92.1 tonnes
_______________
Total 481.5 tonnes in 6 months, for a projected 900 to 1000 tonne export annual total from Sept.1999 to Sept. 2000.
The questions are if the U.S. mines 354 tonnes of Gold per year and is presently exporting monthly Gold amounts at a much higher projected rate and normal domestic consumption is NOT ADDED IN TO THESE FIGURES, where is this Gold coming from and WHY are Gold prices flat???
Please see Sir TownCriers 29050 message and related messages for a much more in-debth analysis of the export figures.
One more easy way to convert dollar Gold into tonnes Gold:
Gold at $280 U.S.:
9 million dollars equals approximately ONE tonne of Gold.
Now, does everybody understand why Gold is stuck around the $280 level......Big buyers are keeping it there thru the paper exchange markets.
Is it not time for us to ask OUR government where the heck all this additional exported gold is coming from? They are collecting the statistics, so their not knowing the answer is not an answer I'm willing to accept.
Just a little temperature inversion. Dow n home boys will have turkey all "cooked" up by 11 a. m. e.s.t.
You know I'm at the point where its almost fun guessing what the Rigging De Jour is going to be. The price of Silver and what its doing to the silver miners is making me sick to my stomach.
I agree, the U.S. Congress should be made aware of these figures, my choice to send an e-mail to is Dr. Ron Paul Congressman from Texas a known Gold advocate.Unfortunately I'm not in his Congressional District.
However, as you can see from my posts a literary giant I am not which makes me kind of squeamish about sending an e-mail.
Also I didn't keep track of the actual export figures released(bookmarks) but I think Sir TownCrier does.
Congressman Paul has a website called Freedom Watch, but I'm not sure how to e-mail him directly.....beesting.
$5 Indian, good story, thanks. Some of us treasure both the trees and the lumber. It is possible to work in the sawmill and also plant trees.
**Richard 640: where do you get the S+P futures numbers on Sunday night? Thanks for the update.
If someone with deep pockets, had 129,000,000 ounces of Silver safe-ly tucked away in the vaults of a bullion bank in England, couldn't that same some-one sell futures contracts in Silver they own outright thru the same bullion bank in England, in enough quantity to depress the "Spot" price of Silver worldwide and slowly buy more physical Silver at refineries and in off market transactions worldwide adding to his 129,000,000 ounces,ever so slowly so as not to draw attention to himself,and eventually create more futures contracts, and unlike the famous Hunt brothers be out of the jurisdiction of the U.S. agencies that might hinder this operation??? ....beesting.
HI - HAT (4/23/2000; 6:05:13MT - usagold.com msg#: 29203)
Trail Guide EURO
Hello. I am looking at analysus that focuses on possibility that Euro's downtrend portends value crises of this currency. It seems that all the prognostications of the dollars future are what is exactly happened to the Euro. Since its inception it has steadily lost value, and now appears at the crossroads to go down more.
This it semms is the only major currency arena where the price of gold is in a bullish uptrend. In a world already saturated with debt financed stuff, it seems any fundamental competative advantage of lower Euro, will still net out very negatively against increased costs for oil,electricity,etc., in Euroland.
-------------------------------
Hello Hi - Hat!
Good question. I'll offer in my words what was presented to me from some other people.
--------
Every time the Euro comes up in conversation someone points out the ever so obvious fact that it has fallen against the dollar. Ok, so what does this do to impact us as world players?
First: my new Euro accounts are static in Euroland and are spent there for investments if and when need be. As a international player I don't trade my dollar accounts (local US held) against these or other holding in foreign domains. To date, my real cost of acquisition in Euroland has little or no effect from the Euro / Dollar exchange rate. A myriad of other factors come into play when determining a particular investment's (Euroland) viability. Unless the industry is exposed as an importer from dollar nations the short term exchange rate means nothing. If our selected sector is export related and sells into a dollar sector, then all the better for them. Our long term success rests on the sector's ability to make an adequate return in Euros. The whole purpose is to build an asset infrastructure that will remain in the Euro realm. Not convert it back to dollars (or whatever currency) in a year or so.
Second: the costs in Europe have not gone up in any way comparable to the amount Euro / Dollar has fallen. Neither I nor anyone else (I know) are concerned with this short term condition. In fact, the lower rate is making my decision to cover dollar debt and refinance in Euro debt for me.
Especially so for anyone that is overweight in long dollar assets (working assets as opposed to investment assets) and wanting more Euroland exposure with less cost. Borrowing Euros to invest in high return financial assets (Euro carry trade) is only a trade against exchange rates and in every
way has the smaller impact on Euro value over a long run. The booming demand for Euros is swamping the ability of US to supply liquidity fast enough to cover the liquidation of dollar debt. In spite of this much examined and overweighted carry trade.
Third: ECB is right, US dollar is up because a funding crisis is drying up dollar assets faster than Fed can supply. From the looks of everyone financing here, Euro is right about where it should be in value. It's the dollar that is spiking from a crisis.
----------------
Editor note: In a broad view just look at Japan. The Yen is being driven up from a long term crisis in their economy. The same thing is only now happening in our US. The difference is that we have "the" reserve currency and our eventual response to a "Japan like" economic condition will be to super inflate the dollar. That is something our fed is doing right now to keep the dollar from going even higher.
In another view, the ECB has the Euro doing what Japan has been fighting like mad to do for many years now. That is get a major world currency down against the dollar by having the dollar driven up from "debt transition demand". No different than as my friend uses his dollar reserves to cancel out his local (US) debt to reestablish in Euros. This effect expands the Euro in a good way but eliminates dollar liquidity in a bad way. The dollar rises from a liquidity "dry up" and this forces the fed to pump. But this kind of pumping floods our shores with dollars that can only function as "hot money" (stock market trading). Not used to finance real industry infrastructure.
If the Euro is causing any pain it is doing so to traders that made long derivative bets on that currency (not invest in it). They bet on the Euro being strong and the dollar being weak. None of then grasped that the Euro would be strong as a crisis of transition made the dollar even more in demand for liquidation.
Confirmation of this is found in the US fed and Treasury using every trick in the book to pump liquidity into dollar based assets. Alan is no fool, he isn't killing the stock market because he can't right now! If the dollar was strong from all the demand media says is out there, why must we pump money during a time our trade deficit is flooding the world with dollars. If the Euro is so week, why is everyone financing in Euros at a rate that's still building?
Sorry to ask a dumb question, but what in the world is going on with the S&P 500 Futures Premium? The MRCI chart shows that it opened at 1266.00, and that it last traded at 596.00, for a loss of -670.00. What's going on?
Hi, Leigh. The S&P Premium is a derivative contract of two other derivative contracts. It's value represents the difference between the cash S&P 500 index and the nearest futures contract of that index. This amount is then multiplied by 100.
So an S&P Premium value of 1266.00 is the same as a 12.66 point difference in the s&p cash and nearest futures.
A few mondays ago when it seemed like the stock market was going to crash Monday morning I knew gold was in deep trouble and the stock market has hit the bottom. I logged on here and seen every body jumping with joy that gold was up over 2 bucks! WOW ... I wish I never heard of the stuff. Gold, when it rallys, will do so for no reason. Look at gold mining stocks during the 1987 crash.. Went up that day but than turned down with the rest of the market after that. If I would not have been so bearish over the years and puchased good stocks I be rich. Or on the other side of the coin maybe its the bottom when I voice my negitive message here. Have a great day. BillyG
"Richard640 (4/22/2000; 7:57:32MT - usagold.com msg#: 29165)
THC & all--the amazing YEN
How the yen has any international standing is a great mystery and a stunning victory (so far) for the fiat currency regimes--With "free" yen (zero interest rates) and round the clock running of the presses for a decade, the Yen is truly the 8th wonder of the world--If, as we say on these forums, the U.S. dollar is toilet paper, then the Yen does not have even this minimal functional value--t'is more akin to a urine-soaked gutter rag."
**********
I think that you may be missing something. A currency can be strengthened by increasing the interest rate, and weakened by lowering the interest rate.
The fact that the yen is able to hold historically high levels with interest rate near 0% and aggressive selling of yen by the BOJ indicates that the yen is "extremely strong" vs. the dollar.
In general, higher interest rates are indicative of weaker currencies......you can find extremely high interest rates in many 3rd world countries......the yen is no worse than the $.......if not much better in terms of fundamental strength.
I've noticed an increase in the number of "sour grapes" posters both here and on Kitco, concerning gold investments. I guess people have a hard time dealing with their own disappointments and have to blame someone other than themselves for their decisions. Kind of sad, but it does fit in very well with what I see in society at large...once again, it's liberty AND responsibility, people.
http://www.egroups.com/message/gata/438?Gold is money but the gold mining industry
doesn't understand it, doesn't understand
that its product is money more than
jewelry and that its biggest competitors
are not other mining companies but
governments.
At least Reg Howe gets it.
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:
Yes, I understand what you are saying, but neither this site nor Kitco is supposed to be a site dedicated to gold stocks or gold options. Both sites revolve around physical gold since both site owners are dealers. This is what perplexes me even more...why people are venting their frustration with paper investments here in the first place...it's almost like they are not even reading what is being written!
By the way, I own both gold stocks and physical...is it that difficult to understand the purpose of each?
If so, once again ALL STOCKS ARE SPECULATIVE -- this includes gold stocks. Physical gold is an insurance policy, hopefully never to be sold at any price.
OK, I tried. I'm sure it will do absolutely no good whatsoever and that I'll be reading another sour grapes post in the near future!
http://www.TheSpiritOf76.com/bigfloat.html "US stock market saved and gold trashed by a collapsing Euro. Those on this thread who have said
again and again that the Euro was preparing to challenge the dollar for global supremacy could not
have been more wrong." -oldgold (4/23/2000; msg#: 29220)
Goodness gracious!! Patience! Neither Rome nor the Euro were built in a day. You must be a member of the NOW generation, oldgold. You're not the only one here who qualifies for membership, however.
Even for the newspapers of the day, the 1929 market crash was only a back page story. The big story, they thought, was Byrd:
"At the end of 1929, the _New York Times_ looked back on
the year to identify its biggest story. It was Admiral
Byrd's trip to the South Pole. ... The smartest reporters in
the world could not see the importance of the stock market
crash in 1929. ...
+
The economy had already turned down in August
1929. It was many months later, after the crash, after
the Suckers' Rally, after a slow year with no recovery,
after the banks started to collapse, that people began
to realize what had hit them. By then, it was too late
to prepare adequately.
+
... Even recognizing that a slump is underway is often
beyond the vision of the authorities. Consider that the
1973--75 recession began in November 1973, but,
reported the _Wall Street Journal_, 'as late as August,
1974, Arthur F. Burns, the Federal Reserve chairman,
was assuring Congress that the economy was still
expanding.'" -James Dale Davidson & Lord William
Rees-Mogg, The SOVEREIGN INDIVIDUAL, (New York, NY:
SIMON & SCHUSTER 1997), p.375
Besides, the dollar is moribund, even if the Euro fails. It's just that the rest of the world will have more motivation to try to prop it up longer.
If you want to see the REAL problem the dollar has, Euro or not, check out the link above.
http://www.usagold.comWanted: All points bulletin, be on the lookout for a small crying boy who goes by the name of Elian, suspect is wanted in the connection with "the plan that might cost me Florida". Suspect may be armed with a unregistered semi-filled orange water pistol. Last seen dragging a yellow blanket across the Toys-R-us parking lot. Rumor has it that he is trying to buy an inflatable air matress. While briefly apprehended at the residence of his uncle after a 130 agent "dawn" attack, the boy managed to slip away while at a rest stop. Apparently he "climbed under". Agents are amazed at the cunning escape. "We knew he had the pistol having seen him do a partial refill at the kitchen sink. What saved us was he "couldn't get all the bubbles out". When agents smashed down the door the boy feigned traumatic shock and tricked us as to his real plans. "He just used us to get to the toy store". Anyone who can identify the boy is to immediately notify SWAT TEAM 1 or the Gore residence.
===========================================================
Hi-Hat...I'm agreeing with Batra's cyclic theory in so far as it relates to conditions of the past that led to its validity. That was "a Gore" about Batra. I mean the ability of governments to monitor economic excesses and distortions has been greatly increased with computers. So they can fine tune this credit expansion and throw wave after wave of extensions out and throw off any predictions we might arrive at based on normal cyclic parallels in past history. You're in the haunted castle and they know every turn you will make, where you will sleep and how to keep you from leaving. But yes, in the end their electricity gets turned off, everyone climbs out the windows to escape. It is more creepy and horrifying than we can comprehend because of who is behind it all and how this collapse is becoming an orchestrated event of chaos to bring about the one world government. No demand, no need for a supply. Bring on a major global depression and now you need big brother in a big way. The people involved believe they are wise and prudent when they are on the Titanic holding cups of tea cruising headlong at 25 knots. Who said all power of the world was given to him to give to whoever he wanted? Who said "My kingdom is not of this world or else my servants would be fighting." One holy Angel killed 185,000 Assyrian troops in one afternoon if you believe the scriptures(somewhere in Chronicals or Kings), so 2/3rds of these God serving creatures are waiting for this war in heaven to begin. May we return to earth. Ravi Batra sees things occurring in linear predictable cycles. No linearity can be applied to exponential curves. Acceleration isn't velocity.
Since when were credit card companies the major creators of M1? Since when were homes purchased with 5% down? Since when was the largest employer the government that produces no product? Since when was the service sector considered to be a "producer that should be considered in the GNP". Pizza shops, nail care, and jiffy lube don't produce anything that can be sold overseas. Since when was the national debt credited as being not-dangerous by utter lies about the revenue surplus? US national debt is a runaway train...........We are in peacetime friend and should have no national debt. I'm saying the folks who buy the ranch in Argentina or the farm in Costa Rica are still better off even in inflationary times there than they will be when this tsunami of debt implosion breaks. I think the technologies available will lend themselves to support the corporations ruleing the world not governments. "They yielded their kingdoms to the beast", the beast doesn't take them. Why? How? because the governments power is being diminished by multinationals who use offshore banks. The multinationals pull the strings and the governments will be unable to raise tax revenues without kissing up to their power. Rockafeller beat the citizens in 1913 and it's a "slow walk" victory. Now with high tech. we will see deflation or inflation to where the rich live VERY rich "and hurt not the oil and the wine" and the poor VERY poor " and a days wages for a days food" REV.6. Approaching it, (not like this suddenly occurs). Global economy means global comparative wages. Say 65 cents an hour for labor and $1 and hour for skilled labor. The disparities between these high wage and low wage countries are going to meld and not become so apparent. They won't change easily they tend to "ratchet" like a object finally overcomming the friction of enertia. Tectonic plate movement is more like it. This is the real doomsday $%^#@. Don't listen to hype. Look at what you see. Are markets saturated, are personal bankrupcies popping like corn? Japan is the USA in 1935. We sucked the investment out of England and pulled a brain drain on Germany, took the best and left the rest. Well as we sink, Japan can attract our investments and take our smartest and best. Calcutta on the Hudson is no comparison to Tokyo. What we did happens back to us. My guess is that Japan will "buy" all the old countries it formerly invaded with force for the same reasons it took them last time. Is Germany not making deals with Russia? SOS. America has cast Truth out of its "dumbed down" schools and is turning into the Island of Dr. Moro. Every major state college has an insane asylum nearby off in the hills that it feeds its crazies to. I've seen it with my own eyes (mostly Keynesians I tell ya). So in conclusion, we have cyclic theory that is true, but the timing of the cycles is way off even by Batra's own calculations. Yeah, just throw away the calculator and go with what you see. The people only "See Green" and they deserve to drift in the green sea.
http://www.cnnfn.com/2000/04/24/markets/stockswatch/S&P Futures down -11.20, should be fun at the open. Feds recommend breakup of Microsoft (MSFT). The NASDAQ graph at the link says it all. Meanwhile Au is up slightly.
I was just reviewing your post from the 22nd about tunneling...I too share your vision!
Just think of the space we could free up on the surface for parks, farmland, and forests. Business establishments found mainly underground with dwellings both on and below the surface...transportation below, enabling today's eye sores of parking lots and roads to be replaced by vegetation and walking/bicycle paths.
Yes, I too am a dreamer...it's what makes me human!
"All our buildings, they're so small, aren't they?"
"What do you mean, Son?"
"I mean, they aren't big enough to be really useful, are they? I remember when I was just a little kid, you, me, mom, and sis just barely fit into our old house. When I jumped out of bed in the morning, I could touch the ceiling with the palms of my hands and you and mom stepped from room to room hunched over all the time. Now in our new house, I have to stoop and you and mom are walking on your hands and knees! This doesn't seem right � it's not practical, is it?"
"Shhh, you're not supposed to notice that!"
"What do you mean, Dad?"
"Just go about your business, things are supposed to get smaller and smaller, it's normal, it's the way it's supposed to be?"
"Why?"
"It, just is!"
"Why?"
"OK, I'm not supposed to tell you this, but since you asked, I'll tell you what I know, but you must promise not to repeat it to anyone. Do you promise?"
"Yes, Dad."
"OK, when I was a kid, we used to go to school. Oh, not the tiny little rooms the you call school, but a huge building with gigantic rooms, some with ceilings as tall as two grown men!"
"Gosh! Why were they so big?"
"I'm coming to that. Well, we had this class called science."
"Science�what a funny word."
"Yes, and a fun class, too. Anyway, in science class, we would have these things called measurements."
"What were �mess-sure-mints�, did they taste good?"
"Haw!�no they weren't food or anything you ate, they were a way of expressing physical things, like height, and weight, and distance?"
"Oh, I heard something in school about those, but not much. That stuff's all too complicated. I think there are experts who take care of those�and the government, too, because it so complicated and everything. But they're called variments, aren't they?"
"Well, that's more than I though you knew, but there's much more to know. A long time ago, even before I was a kid, the government and the scientists decided everyone would be much happier if everyone had the same stuff, or could get the same stuff without too much trouble."
"Gee, that's sounds good."
"Yes, it sounds very good. Well, back then, if you wanted a ham and a ham cost $10, and you had only $9.00, you couldn't get a ham. So, the government and the scientists agreed to redefine what a pound was. They went from using measurements to using variments. So a pound became what had been 0.9 pound and what had been 1.0 pounds became 1.11 pounds."
"Sheesh, that's confusing."
"Yes it is a confusing to most people, especially if they never though about it much, and that's why all variments have been turned over to the experts in government and science. They're smart enough and have enough time to keep track of it all. Anyway, the upshot is that, now everyone could buy the new 9 pound ham which used to be a 10 pound ham. Everyone still got the whole ham, but our �concept� of what a pound was was changed."
"That sounds even more confusing."
"Yes, anyway, you asked about our house."
"Yes, out house! Our house isn't a ham, is it (tee-hee)?"
"No, it's not a ham, but the idea is the same. It wasn't just what a pound is or was that's changed over time, so were old the old measurements as they became variments�."
"Oh, I see, so feet were changed, and inches, and temperature, and�"
"Yes, you've got it."
"But, Dad, do they always have to get smaller?"
"I guess, so. I've rarely seen any variment get bigger. If they did, then people would get less stuff for their money and who would want that?"
"I see, that makes sense, I guess. But, �."
"Yes, Son?"
"But, are house is so uncomfortable. Most days, I can't wait to get outside, even when the weather is bad!"
"I know how you feel, but on the other hand, everyone has a nice house."
"But, it's suffocating me! Sometimes I think I'll wake up with a light fixture stuck in my throat!"
"Now, now, Son, no need for hysteric, you'll get used to it, it's just a phase all kids go through. I'm sure the houses won't get much smaller, and besides, the government and the scientists will be sure to figure it all out -- they're the experts."
"Dad?"
"Yes, Son?"
"Wouldn't have been easier to give the people more dollars so they could buy that ham?"
"Now, Son, you really don't think THAT would work, do you?"
As a first time poster and a long time lurker let me be quick to say that this is one of the better forums where a person can come to discuss and learn among serious people.
Then I'd like to follow with a question: Many a times has 1929 been discussed but I've never seen anyone ask the following question:
During the bank holidays or money withdrawal restriction was there ever a time when a person could not access his safety deposit box at the bank?
During the bank holidays or money withdrawal restriction was there ever a time when a person could not access his safety deposit box at the bank?
I cannot answer your question concerning 1929; however I can tell you that definately in 1933 when the Gold was confiscated by FDR executive order, all lock boxes were sealed. I will have to look up the exact text of the executive order and when I find it I will post it on this forum. I am sure that a bank holiday means that the doors of the bank are closed and that would mean of course that access to safe deposit boxes would be withheld also.
Maybe someone else would know the answer to the question concerning 1929. Even better maybe there is someone out there who has had his or her lock box sealed or seized in 1929 or at any time for that matter. I have been told by my banking friends that If the IRS demanded access to a lock box there would be no way that they would oppose such action. You will find FDR's executive order very interesting indeed. Or should I say sobering.
"During the bank holidays or money withdrawal restriction was there ever a time when a person could not access his safety deposit box at the bank?" SAMCAM (04/24/00; 16:03:20MT - usagold.com msg#: 29270)
YES! Bank holidays nearly always include a holiday for everything in the bank, including any safety deposit boxes.
Worse, after the 1933 bank holidays were over, you couldn't get into your safety deposit box without a bank employee checking it with you. He had to make sure you didn't have any of that newly "controlled substance," gold hidden in there. Until 1974, gold, like heroin or cocaine today, was now illegal for Americans, the "freest people in the world," to posess.
If there was a $20 gold piece were found in your safety deposit box, the bank employee would immediately remove it replacing it with a crisp newly printed $20 Federal Reserve Note.
June gold 281.40-up 20 cents-S&P up 2.1--Are my Nikkei futures flakey-HELP!
www.usagold.comI show the June Nikkei futures at 18,355 down 765-I show the previous day's close at 19,120--these are not Friday's figures-(Friday in Tokyo)--can anyone confirm this? If true, then the Japanese weren't impressed with our last hour "rally". The S&P being up only 2 pts. shows no post (late) rally conviction--as you know, I like to see the S&P up all nite-Our biggest down days, when we closed on the lows, followed nites when the S&P was up on globex.When the S&P futures are down big before the opening, we usually, like today, bottom the first 1/2 hour.(Hmmmm, S&P now only up 1.1 pts. now.Could be an interesting nite if Japan tanks)The world equity markets are like a pie crust stretched across the roof of a volcanoe. Fu Manchu is about to pull the lever to the trap door.
Can't find the clip right now, but a story in California, which is regularly repeated in other states, involves a bank changing hands through a merger, etc., or closing completely.
Often the new owners don't want to be troubled with SD boxes and take them out. They may or may not make an effort to notify box holders at the last address they have. If they do make notification and no one responds after a waiting period, the boxes are taken out and the contents go to a special agency. No notification of this transfer is made. If the contents aren't claimed within a certain period, they are then "taken" by the state.
The name of this agency is obscure, and even if you attempt recovery from it, it is very difficult to prove the contents actually belong to you. In addition, the agency's record keeping is less than scrupulous and more than cryptic.
You may want to think at least twice before using SD boxes.
www.usagold.comI agree with your explanation of why the yen remains strong--My post was merely expressing wonderment at the fact that it continues to be one of the premier currencies of the world. I wasn't disputing the fact that the yen holds value.
If I remember correctly, the banking holiday in 1933 only
lasted for 10 days.
What "killed" the economy of many small towns was bank
failures. There were about 9,000 bank failures during the
1930's.
Now, visualize if you had a safety deposit box at one of
the failed banks. They NEVER opened their doors, and
the contents of safety deposit boxes was handled like I
described a few months back on Kitco:
[What happened, as far as I can figure,
when the Treasury agents went through
the safety deposit boxes in the 1930's,
they left receipts in the safety deposit boxes
at the bankrupt banks. Then, the banks
paid only, mayby 5%, on those receipts.
The receipts were for what might have
been left after they helped themselves
to what was in those boxes.
Funny how not many of us are left to talk
about what happened in the '30s.]
My opinion, and I saw women crying at those closed banks,is you really can't trust safety deposit boxes.
Musings about recent events--political and otherwise
Without sounding trite, my analysis of the whole Elian Gonzalez affair is that the Clinton administration revealed itself for what it really is: fascistic. If this event had happened in isolation, one could turn a blind eye. But it is just the latest in a series of botched raids beginning with Ruby Ridge, then Waco, and now this. I wonder if Bill Clinton got his marching orders from Fidel Castro or did he buckle under the threat that Castro made last week, i.e. he would do everything short of going to war in order to get the kid back to Cuba. One facet which has been overlooked is that Elian can short circuit the whole appeals process and go straight home if he says of his own volition that he wants to leave. Now, what better way to ensure that conclusion than to "re-unite" him with his father in a secluded place away from concerned relatives. Presto! The problem solves itself. I don't think that Congressional hearings can slow down this train. What's the moral of this story? Our government is acting more and more aggressively and less and less constiutionally. What is to stop Slick Willie and Janet "Rambo" Reno (or their successors) from taking your gold some day when it suits them? Answer: Nothing. This is one reason why pre-1933 coins make eminently good sense.
Onto brighter(?) topics of the stock market. Today was an absolute bloodbath for the high techs. The leader, Microsoft, was summarily taken out and shot--without even a final cigarette! Did you notice the volume traded? Roughly 144,000,000 shares which is 4 times normal volume. I hear the sounds of mutual fund managers puking in the bathroom. Redemptions and/or anticipated redemptions must be running high. Even fallen star, Microstrategy (which cost Janus Fund $500 million in a single day) had further on the downside. Here at Centennial I hear a lot of stories. I had friends and family (who are pro-stocks and anti-gold) tell me that it was a good buy after it fell from 226 to 86 in one day. I think they were right but they misspelled the word. It was "goodbye" not "good buy." And so the craziness continues. Now that the general has been taken out, what about the rest of the soldiers? Just look at what happened to Network Solutions, another high flier. It dropped 22 points. Exodus Communications made its "exodus" today--several days after the Passover. The list goes on and on. Anyone who watches CNBC knows this.
So what's next? Based on historical patterns and other market theories (Steve Puetz, Arch Crawford, Erik Hadik, Elliott Wave, etc.), stocks usually drop sharply in the week following options expiration. Options expired last Friday even though the market was closed. So I expect more downside until the May 6th time frame which, if Steve Puetz' "Eclipse Theory" is valid, should mark some kind of bottom. The U.S. dollar started to slide today and it could slide further. Then there could be a rebound from lower levels. If a panic develops, expect the masses to rush into gold. Even if the market just slides orderly, I expect more and more people will "diversify" into precious metals as a hedge against uncertainty.
Question of the Day: What Happened to LGB, Anti-Goldbug?
LGB....He used to post thousands and thousands of words attacking goldbugs and their favorite investment over at KITCO, predicting disaster for gold and gold stocks.
Oh, you know what they say: what comes around goes around.
Now I see his favorite company, employer, and oft touted investment, LORAL, just set a 52 week low around 7.00! DOWN over 75% from its high. It seems like only yesterday he was banging on the table demanding the stupid goldbugs buy his company stock because it would zoom through the roof while gold would fall into the sewer.
Loral....What a massacre!
And now stock analyst Ernst over at Prudential just announced in the Wall Street Journal that he does not think the company can survive beyond 2000 without tremendous cash infusions or a huge turnaround in its money-losing global satellite phone business. He is suggesting Loral could be a bankruptcy in the making?????
Wow! Is LGB looking for another job?
Come on, LGB, give us a holler and let us know. Enquiring minds want to know.
What would keep Clinton and clan (or congress for that matter) from taking your gold ? Nothing at all. But what makes so many feel that pre-33 gold is any different when they can "change the rules" at anytime, in any direction if they so desire ?
If the government decides to "call in" gold again as it did in 1933, there is NOTHING to keep them from calling it ALL in, numismatic, bullion, or whatever. Pre-1933 gold has no "mysterious exemption" if and when they decide to get "serious". Too many people seem to overlook this fact when touting, selling, or buying pre-33 gold coins because they are "safe" from confiscation........NOT ! Most of this type of gold is as plentiful as any other "bullion" type gold, yet the premiums consistently charged and "explained away" just don't hold water when you really stop and think about it.
When it comes right down to it, do you really think anyone is going to give you change in a worst-case scenario ? In such an instance, gold will be gold, and an old St.Gaudens will be worth the same (weight for weight) as a Krugerrand, Maple Leaf, or Eagle.
If (when) the bottom ever falls out, gold will be gold, and "collector value" (read over-priced premiums) will be the last thing on anyones mind. Late 1979 into early 1980 was a good example of "vanishing collector premiums" in many gold and silver "collector coins" (i.e. readily available junk silver -- and even "junk gold" as some refered to it back in those days). It was ALL scrap !
Ever wonder why there are so many coin dealers ready and willing to let you "trade up" from your bullion into "numismatic" gold coins ? Can you say "profit" ? With all due respect to most of these coin dealers, I sometimes wonder if they honestly believe they are doing their clients a "favor" by leading them in such a direction, or if they are just perpetuating another "myth" for the sake of a buck.
Remember, Congress is empowered to make the laws of the land, and they can just as easily change the rules right in the middle of the game if they so desire.
Does this mean I think that all "good law abiding citizens" will turn in all their gold at the whim of a President or the U.S.Congress ?
Sure they will......just like they all did back in 1933 !
Seems to be an awful lot of pre-1933 government confiscated gold floating around these days, don't you think ?
Assuming he is correct the Commerce Department is misleading the financial community by counting as exports a "commodity" that is already owned by a foreign entity, and we have to add another $921 million to the trade deficit for February.
-------------------------------------------------------
So who's gold was it that left the USA? I read over the week-end that much of the world's (CB) gold is stored in some 'cavern' seven stories below the New York Fed. If it's Switzerland's gold (for their upcoming) sale(s) why is it being counted as US export? Why is so much foreign gold in the US? What or who's gold is at Fort Knox? Is there alot of gold being double and triple and etc. claimed? Why is all this taking place since the W.A.? And I save the best for last; why do we know of every countries gold holdings and intentions (including Britain, have 715 tonnes, selling 400) except the USA? Why does the US keep every ascept of its gold policies dark, secret, manipulative, convoluted and distorted? Why do I have an inkling of an idea of gold in respect to England, France, Germany, Canada, China, Russia, Kuwait, Belgium, Australia, Japan, and probably a dozen other countries but the intention, the direction, the admission, the accountability, etc., etc., of the US is as clear as mud??
For the record: Alan Greenspan Bio by Jack Anderson (Little Known Facts)
http://www.desnews.com/cgi-bin/libstory_reg?dn00&0004190021"-- After a year at Julliard, he was hired to play with the Henry Jerome swing band managed by Leonard
Garment, who later introduced him to Richard Nixon. He played the baritone saxophone, clarinet, flute and bass
clarinet. He also handled the books and helped band members with their taxes. He played with the band for one year."
-----
I have completed my writing project and will be back in the saddle tomorrow.
Among other biographical detail, let it also be known that Alan Greenspan was a left-handed first baseman, is partial to the woodwinds, and was introduced to the great Ayn Rand by his first wife, painter Joan Mitchell. (Somehow, all of this fits.) From there he taught economics at New York University (though he probably would have preferred to fill in at first for the Yankees, or perhaps play a solo or two for the Dorsey band). All of which brings to question what would have happened if fate had taken a different turn.
Now he's married to another Mitchell, teaches economics at the Capitol Building and fiddles with the economy. As a Fed chairman, some would describe him as ambidextrous -- a switch pitcher who can throw from either side of the mound.
On the markets, somebody said today that nine of the ten worst days in NASDAQ history occurred in the last two months. (That is if I recall correctly: The correct figure is at least in that same realm.)
That 's a stochastic you can hang your hat on.
The rock pauses momentarily at the brink, shudders in a final attempt to keep its place, then tumbles irreconcilably down the mountainside -- its fate, and resting place, unknown except to the unaffected observer who watches it . . . from afar.
When Geo. Soros dumped some of his holdings. This is the
one that made me wonder what happened:
By Tomi Kilgore, CBS MarketWatch
Last Update: 11:46 AM ET Apr 22, 2000
NewsWatch
NEW YORK, N.Y. (CBS.MW) -- Financier George Soros has
unloaded his stake in Globalstar Telecommunications, which has seen its
share value drop more than 80 percent.
After hitting a 52-week
high of 53 3/4 in
intraday trading on Jan.
3, Globalstar's stock
(GSTRF: news, msgs)
hit a new low of 7 7/8
on April 17 before
bouncing slightly. On
Thursday, the stock
closed down 12 percent
at 10.
The Soros Fund Management LLC group of hedge funds has sold its
more than 5 percent interest in the troubled telecommunications satellite
maker, according to an April 20 filing with the Securities and Exchange
Commission.
Globalstar is a partnership of many telecommunications service providers
and equipment manufacturers, including Loral Space and Communications
(LOR: news, msgs), Qualcomm (QCOM: news, msgs), the U.K.'s
Vodafone AirTouch (VOD: news, msgs) and Hong Kong's China
Telecom (CHL: news, msgs).
Loral is the managing partner of Globalstar, and with a 42-percent stake
in the company, its largest shareholder. Loral's shares closed Thursday
down 3/8 at 8 1/8.
In July 1998, Loral announced that it sold three Soros funds an aggregate
of 8.4 million shares of Globalstar stock at approximately $29.17 each.
At that time, Bernard Schwartz, chairman and chief executive officer of
both Loral and Globalstar, said that "Globalstar benefits strategically by
the addition of the Soros funds as a strong new shareholder with an
international scope."
[Fair Use For Educational/Research Purposes Only']
Why stop there? What would keep the Gov. from taking all your cash? Ha! Ha! That's right, they could just call in all your money!
How about them taking the diamonds, china, 1/2 your food and
spare tires? Hell, they could even demand we turn in 2/3 of our stock certificates (gold shares included)! If they are half as stupid as we think, they may even want all the derivative contracts also (smile).
It doesn't take too much brain space to understand how one tries to structure his wealth to dodge as much "incoming" as possible! Pre-33 may or may not work, but it's a good bet it will.
Also: in the thick of things art work still holds it's premium. So do coins. When France fell, art, coins, china and anything rare was taken before all the rest. Even in Nam rare things held a higher price on the last days. I know some boys who were there.
As for "profit"? I have lived a long time and can't remember not paying a profit premium for anything or any service. In fact, the better the advice the cheaper the profit became. Yet, I have seen many, many people spout off that they pay almost no profit for something. In the end they got what they paid for.
But you knew this already. Just thought I would put in words for everyone, what you knew but forgot to say.
The above link, I couldn't cut/paste the text into this.
But if you go-there, and read-it, it appears to me
(and the Telegraph Reporters) as if the Euro is being
abandoned before they even print the first one.
What do you make of this twist of events.?.
Is their report incorrect.?. If not, why do you (FOA)
continue to tout the Euro so highly.?.
Well spoken as usual. And to the point of items of "true art" and "true rarity", I could not agree more.
However, blanket statements as to "all pre-1933" gold as being somehow "rare and unusual" or of more inherent value than any other bullion has long been not only a misconception, but very misleading at times. It is of this type of material that I speek, not the true rarities of the numismatic world.
I too have watched these markets for many years, and have seen todays "rare and unusual" (common pre-33 gold coins) tossed right into the scrap heap on many an occasion. Not that it mattered to most during that period ('79-'80) because of the high prices received, but during the decade of the '70s as now, it was possible to "pad one's nest" to a much greater extent via simple bullion purchases in favor of the so-called "semi-numismatic" ploy.
In "normal times" (whatever those may be), playing the premiums of such items may have some advantages. But when all the pot is boiling over, net gold weight (if we are to stand by our convictions) will be the name of the game.
Thank you for your excellent postings.....I enjoy them all.
Did you catch this from that Idiot Gore just now, regarding the shooting by a young teenager.--- "We really have to have mandatory child safety trigger locks," Gore told the crowd, sounding a frequent administration theme. ----
Like a 12 year-old or even 4 year-old would be stopped by that. The man reminds me of that old movie "The Stepford Wives" where they do away with the women and make programed robots out of their bodies.
During the bank holidays or money withdrawal restriction was there ever a time when a person could not access his safety deposit box at the bank?
On April 5, 1933, acting under the authority of the Emergency Banking Act, FDR issued Executive Order No. 6102:
"By virtue of the Act (Trading With The Enemy Act) of Oct. 6, 1917, as amended by section 2 of the Act of March 9, 1933�, in which�Congress declared that a serious emergency exists, I as President, do declare that a national mergency exists; that the continued private hoarding of gold by subjects of the United States poses a grave threat to the peace, equal justice, and wellbeing of the United States, and that appropriate measures must be taken immediately to protect the interests of our people." Therefore, pursuant to the above authority, I hereby proclaim that such gold holdings are prohibited, and that all such coin, bullion or other possessions of gold be tendered within fourteen days to agents of the Government of the United States for compensation at the official price, ($20.67 per ounce) in the legal tender of the Government. ALL SAFE DEPOSIT BOXES IN BANKS OR FINANCIAL INSTITUTIONS HAVE BEEN SEALED PENDING ACTION IN THE DUE COURSE OF THE LAW. All sales or purchases or movements of such gold and silver within the borders of the United States and its territories, and all foreign exchange transactions or movements of such metals across the border are hereby prohibited."
"Your possession of these proscribed metals and/or your maintenance of a safe-deposit box to store them is known to the government from bank and insurance records. THEREFORE BE ADVISED THAT YOUR VAULT MUST REMAIN SEALED, AND MAY ONLY BE OPENED IN THE PRESENCE OF AGENTS OF THE INTERNAL REVENUE SERVICE."
By lawful Order given this day, the President of the United States."
The above quote was taken from a book by Michael Haga, "After the Crash", PP 189-190. A portion of the quote was put in caps by me, to bring attention to the action concerning Save-deposit boxes, "YOUR VAULT"
The nightly PATSY Index shows the relative
amount that GoldBugs have been conipulated.
XAU=56.04 + POG=278.10 + POS=4.95
-equals-
339.09
Up +0.02 from Thursday. It's (+) because the XAU went UP.!.
Comment: PPT, as usual pumping up the DOW & NASDAQ. And
when they do that, other BadGuys chime in and short the
PM markets. But I see the trend I spotted last week, is
continuing: Newmont (NEM/nyse) Gold Mining shares are +up+
again today, despite the PM's trashing. It appears to me,
that some SmartMoney, somewhere, is flowing into GoldShares
on a +very+ selective basis. Good ones, can indeed be a safe
haven in lieu of Physical Gold. Notwithstanding, "advice"
of many in this forum who would have you believe ElseWise.
Perhaps they are envious of the nice regular dividends.
Prediction: More (or less) of the same.
ThaiGold...
Got Some.?. ... Get Some.!.
=========================================================
"Ever wonder why there are so many coin dealers ready and willing to let you "trade up" from your bullion into "numismatic" gold coins ? Can you say "profit" ? With all due respect to most of these coin dealers, I sometimes wonder if they honestly believe they are doing their clients a "favor" by leading them in such a direction, or if they are just perpetuating another "myth" for the sake of a buck."
aunuggets, you should take advantage of this changing premium. When the premium is low, trade the bullion coins for the older coins. At a time when the premiums are higher switch back into the bullion coins. In this way it is YOU who are profiting by growing your pile of gold with no more cash outlay. I just traded a bunch of old $20 Libertys for more ounces in gold bullion. Gold DOES pay interest.
Greetings all in this most vociferous moments of our recent history as a global trading entity. We are truly coming to a moment of climax to where PM's are embraced or another paper dungeon is built. It seems that with the papering of the bubble bursts of the past years only worse tendencies to failure and capitulation begin to occur.
The need for PM's as an alternative for wealth storage has existed throughout the ages. The need for a paper instrument representing ownership in a mining company has only appeared recently in our history. The question remains unanswered that if the final washout in the market causes longterm disengagement with equities. Now is a time where these fundamental questions may come to be tested. View
Yesterday's Discussion.
Welcome to the Forum.!. Your message #29294 was short and
refreshingly to the point. You said (partly):
[quote]
The need for PM's as an alternative for wealth storage has existed throughout the ages. The need for a paper
instrument representing ownership in a mining company has only appeared recently in our history. The question
remains unanswered that if the final washout in the market causes longterm disengagement with equities. Now is a
time where these fundamental questions may come to be tested.
[unquote]
ThaiGold wishes to mention, that during the 1929-1930's
depression/crash era, one shining star was Homestake
Mining Shares, which appreciated highly in value, and
continued paying nice dividends throughout that devastion
of all other forms of stock and wealth. In addition, physical-gold holders also were shortchanged by the infamous
confiscation of their cherished holdings by President FDR.
So indeed, there may become another disengagement of equity.
Hill Billy Mitchell (04/24/00; 22:24:11MT - usagold.com msg#: 29290)
I have a copy of the Post Office "Poster" notifing the public of the Executive order.
Your authors "Quote"
>>>>I as
President, do declare that a national mergency exists; that the continued private hoarding of gold
by subjects of the United States poses a grave threat to the peace, equal justice, and wellbeing of
the United States, and that appropriate measures must be taken immediately to protect the
interests of our people." Therefore, pursuant to the above authority, I hereby proclaim that such
gold holdings are prohibited, and that all such coin, bullion or other possessions of gold be
tendered within fourteen days to agents of the Government of the United States for compensation
at the official price, ($20.67 per ounce) in the legal tender of the Government. ALL SAFE
DEPOSIT BOXES IN BANKS OR FINANCIAL INSTITUTIONS HAVE BEEN SEALED
PENDING ACTION IN THE DUE COURSE OF THE LAW. All sales or purchases or
movements of such gold and silver within the borders of the United States and its territories, and
all foreign exchange transactions or movements of such metals across the border are hereby
prohibited.<<<<
Actually reads as follows:
I, Franklin Roosevelt, President of the United States of America, do declare that said national emergency still continues to exist and pursuant to said section do hereby prohibit the hoarding of gold coin, gold bullion, and gold certificates within the continental United states by individuals, partnerships, associations and corporations and hereby prescribe the following regulations for carrying out this order:
Section 1. for the purposes of this regulation the term "hoarding" means the withdrawal and withholding of gold coin, gold bullion or gold certificates from the recognized and customary channels of trade. ----
Section 2. All persons are hereby required to deliver on or before May 1,1933 to a Federal reserve bank or branch or agency thereof or to any member bank of the Federal Reserve system all gold coin, gold bullion and gold certificates now owned by them or coming into their ownership on or before April 28th 1933, except the following:
(a) such amount of gold as may be required for legitimate and customary use in industry, profession or art within a reasonable time, including gold prior to refining and stocks of gold in reasonable amounts for the usual trade requirements of owners mining and refining such gold.
(b) Gold coin and gold certificates in an amount not exceeding in the aggregate $100.00 belonging to any one person: AND GOLD COINS HAVING A RECOGNIZED SPECIAL VALUE TO COLLECTORS OF RARE AND UNUSUAL COINS. (Caps mine)
(C) Gold coin and bullion earmarked or held in trust for a recognized foreign government or foreign central bank or the Bank for International Settlements.
(D)Gold coin or bullion licensed for other transactions (not involving hoarding) including gold coin and bullion imported for re-export or held pending action on application for export license.
Section 3. Until otherwise ordered, any person becoming the owner of any gold coin, gold bullion or gold certificates after April 28th, 1933, shall within three days after receipt thereof, deliver the same in the manner prescribed in paragraphs (a) (b) or (c) of Section 2; or unless such gold coin, or gold bullion is held for purposes specified in paragraph (d) of section 2 and the person holding it, is with respect to such gold coin or bullion, a licensee or applicant for license pending for action thereon.
Section 4. Upon receipt of gold coin, gold bullion or gold certificates deliverered to it in accordance with sections 2 or 3, the Federal reserve bank or member bank will pay therefore AN EQUIVALENT AMOUNT OF ANY FORM OF COIN OR CURRENCY ISSUED UNDER THE LAWS OF THE UNITED STATES.
---------- ------------- -------------
Nowhere on this placard is there a mention of sealing safe deposit boxes, however it does say "For Further Information Consult Your Local Bank"
Note that the "Pre-1933" exemption is actually a misconstruction derived from any gold acquired AFTER April 28th of that year NOT being qualified for the exemption (Per Section 2 (b), as "having a recognized special value to collectors of rare and unusual coins."---But, IT IS THE CATEGORY OF "RARE AND UNUSUAL" THAT WAS EXEMPT: NOT THE CATEGORY OF PRE-1933 !!
Never-the-lessAs MK often says (Physical) Gold is the only asset that is not someone elses liability. Mines have liability!!
Some mines in the past may have done well in bad times, but if a may originate a paraphrase of George Santayana's ultra-famous qoute: Those who count on history repeating itself may be doomed when it fails to do so.
You whizzes out there! What are the chances that the US will devaluate the dollar and at the same time go back to the gold standard with the "new dollar"!
And why not while they're at it wouldn't they move in and occupy Saudi Arabia, grab the gold and the oil, and continue living in greed and wastefulness?
What's preventing them? Could they lose face? Hardly anything left! Could they become more unpopular? Not much more!
Help me out you guys that know the score, is there a secret pact between the Arabs and the Russians that if the US tried a stunt like this the Russians would.....
My we have an interesting situation. I quote an author who's credibility I must admit has not been check out by me. Mr. Michael W. Haga is I think fairly young and writes his books with mixed motives certainly. I will do my best to check this out by going directly to the source. It will take me some time to get around to it; however due to daily ditch digging demands upon me. Quite an aliteration, huh!
You quote an agency of a government whose "full faith and credit" began to vaporize in the early 1900's. The wonderful thing about this forum is that given enough time we as a group who really want to know the truth finally get to it the "old fashion way", we earn it.
On Saturday, April 22, 2000 My wife and I were in an unususal situation. We were in the same room with a television as we were in a motel celebrating our 33 wedding anniversary. What was unusual was the television. My wife popped the remote and we were suddenly staring at a picture of a federal agent confronting a frightened child and one of his socalled abductors. This picture plus several angles of the footage of the female federal agent forcefully removing the child into a safer place, a federal van with darkly smoked windows, was all over the place. We found it on every network. The horror or it all was a great shock, to me and my wife.
My daughter who lived in the vicinity where we were staying came to visit a couple of hours later. Because of her training she has no ready access to a television either.
When she arrived at our room we told her of what appeared on the TV. She said, turn it on, I can't believe it.
We turned the TV on and to our dismay all of the networks had dropped the most graphic revelations of what had occurred. We searched and watched the propaganda for about an hour switching from channel to channel to channel. We did not have access to Fox News Channel and cannot say whether the same thing happened on that channel.
What obviously happened was that the networks were given instructions to not show the pictures or play it up verbally any more. This is not heresay for me and my wife. We watched this happen with my own eyes only days ago.
I would caution all who read at this forum to be careful to thoroughly check out anything you see. Do as Sir Peter has done with me and as I plan to do. Question the one who makes a statement or quotes someone else.
Of course we can't question something as official as a "U.S. Government poster", can we. After all upon such posters will we find, "the whole truth and nothing but the truth", so help us GUV.
Source: Bridge NewsNot much in the way of news this morning, found this bit of news:
S Africa Press: Falcon warns it may close Zimbabwe gold mine
Johannesburg--Apr 25--Falcon Investments, the Luxembourg-based and Johannesburg Stock Exchange listed mining resources group which owns the Falcon Gold mining company in Zimbabwe, has warned investors it could be forced to shut the mine down, Business Report reports. Directors say that Falcon Gold is likely to report a first-half operating loss because of heavy rains, power disruptions, high inflation and an unsustainable exchange rate between the US dollar and the Zimbabwe dollar. (Story .11170)
Black Blade: Not to mention that Zimbabwe is in a state of anarchy. The veteran/squatters are burning, looting, raping and killing with the apparent support of pres. Mugabe. This could be a major problem for the mines in Zimbabwe such as PGM producer Zimbabwe Platinum Mines (Australia: ZIM). The SA pres. Was joking with Mugabe at the recent meeting of Africa heads of state, and was criticized for not condemning the violence in Zimbabwe, meanwhile share prices of SA mines could suffer as a result of the violence next door.
Also: S&P Futures up +9.00 as Wall Street attempts to rally after yesterdays wild market action, and Au is down slightly on light trading overnight.
But if you go-there, and read-it, it appears to me (and the Telegraph Reporters) as if the Euro is being abandoned before they even print the first one.
What do you make of this twist of events.?.
Is their report incorrect.?. If not, why do you (FOA)
continue to tout the Euro so highly.?.
Cordially
ThaiGold
--------------------------------------------------
Hello ThaiGold,
Here is part of your article:
-----------------------------
City: Economic week: Interest rate fears dominate
TONY BLAIR was urged to rethink his commitment to the euro last night as the ailing currency suffered a fresh blow to its credibility.
Leading German financial experts issued a warning that it would fall further in value unless there was urgent economic reform. This was a clear sign that opinion formers at the heart of the eurozone are turning against the 16-month-old single currency. A week after it hit a record low against the dollar, there are now fears on the Continent that it is facing a full-scale crisis of confidence.
The most damaging attack was made by Prof J�rgen Donges, who heads a committee of five independent "wise men" which advises the German government on economic issues. He said that Germans had been told that the euro would be as strong as the mark, Europe's most successful post-war currency. But they had been bitterly disappointed.
-----------------------------------------
Thai,
Go to my above link and plug in German Marks to US Dollars.
You will notice that the Mark once brought .60 cents +/- in 1980 then plunged to buying .30 cents by 1985! What's that, a 50% loss against the dollar?
Then notice how it was at .72 cents in 1995, then plunged to .55 cents by 1997. What's that, another 30% loss?
The Mark was also spectacularly strong against the dollar at times. My point is that using the Euro as an excuse for European currencies to have fallen is all wet and these guys know it! The German people (and most of Europe) have known money fluctuations from their birth. The above "wise men" are not going to sell them on dumping the Euro on the grounds of it's recent exchange rate.
It's all politics, pure and simple. The anti Euro crowd in England is trying to sway Tony away from his well founded convictions. Still, Britain will join the EU as soon as possible because it represents a new future for them. I have well positioned advise that the dollar is going to begin it's decent this year. As soon as it does these political outcries by "fat cat special interest" will silence.
Believe it!
Read my last (recent?) post here about the Euro value. It's a convoluted story, but our modern 80 trillion derivative driven currency world make traditional money flows (and values) hard to fathom.
Besides, who's fooling who about the Euro? Quoting from today's WSJ currency page:
--------
"Even after the expected increase (talking about ECB Euro rates), the Central Bank's main refinancing rate would remain well below those in other western countries - at 3.5%, compared with 6% in the US and the United Kingdom".
--------
The Euro is weak? Give me a break? Some posters here only look at the exchange rate to see a currencies strength. That's good for the "trader crowd", but it doesn't begin to address the fundamental forces that truly impact a currencies real redeeming qualities. We are talking about real world "use" and the cost to implement that "use" in business. At these rates the Euro is smoking the dollar, hands down. Can you imagine what the exchange rate would be if Euro rates were raised somewhat close to Western rates?
The most exciting dynamic here is that these low Euro rates are building an economic infrastructure in a major world trading block. And doing it during an expansion in it's beginning timeline. And retaining a solid currency in the process.
I agree with the ECB: the Euro is fundamentally strong to the extreme, while the dollar is looking more like a Yen. So what if the dollar rises? It's strength is a sign of failure because our rates must be so high to maintain it. This same "high dollar rate" momentum, that traders love is just killing the international US debt quality from the trade deficit flood.
So do we want to have our assets in Japan instead of Euroland? Japan has a strong currency with 0% rates. Good, yes? Ha! That arena is in a crashing crisis and embarking on it's own hyper - inflation policy to try and control it. The Yen is strong because they are drying out! Our Dollar will
do the same, only we will gun rates higher in a "wind down" of reserve currency status. Just the opposite from Japan. Eventually, price inflation will eat the dollar on the exchange rate market, no matter what our interest rate is!
Further
Most TGBs attack the Euro story because it validates the current gold market dynamic "Another" laid out long ago. It ruins their passion for Gold stocks and gold derivatives as it proclaims that physical gold will at least match ( or far exceed) any possible run in these paper products. He
influenced this political process privately in the early 90s and publicly in the late 90s. To date the whole dynamic is proceeding and many other analysis are now moving in this direction. Truly, it's a transition on an epic scale.
Thanks for the manner in which you explain the seemingly inexplicable. You make the complex and veiled political and economic agendas of this world easy to understand.
But Buiter does not believe the pound's strength will last. "Everything ultimately returns to reality. It's a question of how fast," he says. "It's the same with the stock market. The stock market globally, and especially in America, has been detached from reality for years now. At some point you are tempted to say this is a form of permanent insanity but it never is. These things get corrected. We've had quite a long upward swing in sterling now and a persistent overvaluation for probably as much as three years. I expect to see a correction in due course. I can't tell you whether it will be tomorrow or in 2002. I hope it will be the former."
And when sterling does fall, it will drop sharply, he predicts. Has not sterling benefited from a re-rating of the British economy, as a result of the MPC and the better-than-expected recent performance? Sushil Wadhwani, a fellow MPC member, thinks so but Buiter is unimpressed. "I don't buy any of that," he says. "It's just twaddle. You can't tell a fundamental story about re-rating. It is just some big and largely irrational confidence discount on the euro and the ECB. And that will pass.
"If sterling finally decides to do the decent thing and move to a level that can be rationalised in terms of the economic fundamentals, say some 15% to 20% below where we are now, then you would have a major inflationary impulse from that and interest rates would have to be higher than they otherwise would have been."
I think the key word here is FUNDAMENTALS. The UK economy is been completed decimated. Manufacturing concerns are been wound down daily. The only jobs been created are those of supermarket check-outs, shelf-fillers, call-centre operatives etc. A nation of 55+ million cannot survive on these service industries. They need to make widgets. So, why does sterling continue to rise relentlessly? I guess they need to ensure that the sheople can continue to get their cheap vacations in Spain, Portugal, Turkey etc. Further enhancing the illusion that the GREAT still exists in Britain.
I expect a 40% devaluation of sterling coupled with double-digit interest rates. This should induce enough pain in the sheople to encourage them to accept the changes which they would otherwise have rejected.
Peter Asher (04/25/00; 01:25:29MT - usagold.com msg#: 29296)
And Hill Billy Mitchell (04/25/00; 06:33:08MT - usagold.com msg#: 29299)First:: my last paragraph: >>>>Note that the "Pre-1933" exemption is actually a misconstruction derived from any gold acquired AFTER April 28th of that year NOT being qualified for the exemption (Per Section 2 (b), as "having a recognized special value to collectors of rare and unusual coins."---But, IT IS THE CATEGORY OF "RARE AND UNUSUAL" THAT WAS EXEMPT: NOT THE CATEGORY OF PRE-1933 !!
Should read:
Note that the "Pre-1933" exemption is actually a misconstruction derived from the date of the order and that any gold acquired AFTER April 28th of that year also may be kept if "RARE AND UNUSUAL COINS" But, IT IS THE CATEGORY OF "RARE AND UNUSUAL" that was exempt in all cases, NOT THE CATEGORY OF PRE-1933 !!
Yes HBM, absolutly. The "Copy" of the "Official government poster" may or may not be valid. AND, as I pointed out it also said "For further information cosult your local bank"
So, what "TRUTH" did they have to tell the folks who "Consulted them for further information"??
Thank you, sir for posting the words of the 30's gold confiscation. My blood began to boil as I read it!
The two most disturbing things to me about the event are -
1. The insinuation that private gold holdings are a a threat to the country, when actuality, it was the government's and Fed's mismanagement of monetary policy (read gold) which precipitated a crisis...the individual citizen was expected to "pay" for their mistakes.
2. I also am disturbed that this 'decree' would force me to break the law. Now, I consider myself a law-abiding citizen...at least I do my best and consider myself conscientious in these matters. Having to act on principle here would not make up for the feelings of guilt in having to go against society's designated leadership. I personally hold President Roosevelt responsible as if it all happened yeserday...is there any wonder his peers referred to him as, "that man"? (Yes, sometimes the rich are right).
Jefferson, Franklin, Adams, Madison, et al. must have been rolling in their graves.
http://www.usagold.com/Order_Form.html4/25/00 Indications
�Current
�Change
Gold June Comex
281.20
nc
Silver May Comex
5.04
+.03
30 Yr TBond June CBOT
97~15
-0~06
Dollar Index June NYBOT
108.08
+1.01
Market Report (4/25/00): Gold was level in the early going with the euro and Swiss franc
both taking major hits in the Forex markets. With the euro now trading in the 93� range, one
wonders what actions Europe might want to take to shore up its sagging currency, if any. One has
to consider whether or not the governments and the ECB have the desire (or political will) to stop
the slide given recent history. The yen looks like the big winner here. If it's up against the dollar
this morning, it has to be way up against the euro. Look for Japan to attack its currency at some
point as the currency devaluation wars rev up to high rpm's. European high unemployment,
export based industries, and leftist/socialist governments make a volatile mix, and if it can be
accomplished in the modern economic amphitheater, it is usually the currency that suffers. To our
way of thinking, we would hint at the possibility that the observant European or Japanese money
manager, or private investor, would be thinking yellow metal at this point. There's isn't a currency
out there relieved of the debasement strategies of the world's governments and central banks. Even
the supposedly safe-haven dollar, which has suffered our own Fed's attempts at monetary policy
conducted as if there were no relationship between monetary inflation and economic turmoil, is
suspect. In the Clintonista world of fabricated reality, if the golden messenger can be kept quiet in
every respect, then the message is never delivered and the warning never heard (so they think) --
unless of course one is prescient enough to see through the web of deceit. Then you would already
be a gold owner and thinking about adding to your holdings. Hedging makes a great deal of sense
once you realize what the politicians and bureaucrats are up to.
As for the gold market itself, Europe was fairly quiet overnight and Asia reports support from
physical dealers bolstering our contentions as stated above. The next Bank of England sale is
slated for May 23. Cambior, the Canadian company deeply involved in a failed hedging program
which blew up in their hands when the Washington Agreement was announced and the gold price
firmed, is now trading at record lows after posting big year end losses.
That's it for today, my friends. See you here tomorrow.
The May News & Views is at the printer and will be out shortly. We think you are going to like
this issue written during the weekend after the April 14 Wall Street Meltdown.
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 link above and make the appropriate entries.
Now that I'm more awake, I'll add the very first part of the first paragraph of the order:
By virtue of the Act of October 6, 1917, as amended by section 2 of the Act of March 9, i933, entitled "An act to provide relieve in the existing national emergency in banking, and for other purposes", in which admendetory Act Congress declared that a serious emergency exists, ---
I watched the CNBC special last night on the history of Wall Street. Part of the program centered on J. Pierpont Morgan and his being the "lender of last resort" during the 1907(?) crash. The tie-in was that the re-creation of the Federal Reserve Bank (Central Bank) in 1913 allowed for a true lender of last resort (more reliable than a private individal cobbling together a lending package).
Now, this does make sense...although it is, of course, extremely narrow minded in its justification for a CB.
Here's my observation...
I believe this need for a lender of last resort is necessitated mainly because of the structure of the equity markets. You see, the stock markets are based as much on large brokerage houses/money center banks profiting from creating trading volume as they are from the basic need for companies to raise capital. Basically, if rabid speculation and huge profits for the large money interests were eliminated, there would be much less need for this backstop of a last resort lender. Companies would fail or thrive BASED MORE ON THEIR OWN MERITS, not as much on easy cash propping up prices from a liquidity stream (short term traders). Yes, investors would be less likely to pour money into shaky business models (read many of today's .COMs).
So, no shorting, no options...far less manic buying/selling. More of a Buffet style buy and hold mentality based on fundamentals.
This is a very new idea for me...any comments welcome...and yes, it does reflect on gold since physical gold is not in itself leverage either...that's basically what I see here... too much leverage and thus the need for more safeguards in the system.
"JERUSALEM (April 24) - The foreign currency department of the Bank of Israel announced yesterday that the foreign currency basket that determines the exchange rate band will be adjusted on May 2. The adjustment will compensate for differentials between the currencies' respective weights in the basket and their weights in Israel's bilateral balances of trade for 1999.
As a result of the adjustment, the British pound sterling
component of the basket will be reduced 06 percent,reflecting the gap between its proportion in the current foreign currency basket and its weight in the balance of trade with Great Britain.
The reduction of the influence of the pound sterling will
trigger the following adjustments: The weight of the euro
will increase by 1.86% and the Japanese yen by 0.62%,
while the weight of the US dollar will decrease by 0.42%. "
"Even after the expected increase (talking about ECB Euro rates), the Central Bank's main refinancing rate would remain well below those in other western countries - at 3.5%, compared with 6% in the US and the United Kingdom".
TG -- think we could re-finance the house in Euros? Before the rush begins?
Of course we'd have to hedge the future Euro/dollar rise, since we earn in dollars. That would be a call on Euros, or maybe a put on Tbonds (call on TYX). Just throw us on that $80 trillion derivative heap. Of course, we'd be first in line for collecting. Not!
Then we could broker our neighbors getting in on Euro re-fi's. Get our own Euro carry trade going. (Just think of the fees!) Oh, but the unwinding (big grimace!) ahead!
The successful strike gave a shot of energy to dozens of Los Angeles unions as they enter a summer of contract negotiations that will affect 300,000 workers, from teachers to bus drivers. It also helped galvanize immigrant workers across the nation, who are increasingly demanding better wages and working conditions.
"This is the beginning of a new era for organized labor,"
declared Mike Garcia, president of the Service Employees
International Union, Local 1877, which represents 8,500 janitors in Los Angeles County. "This fight wasn't just about us. That's why we got such tremendous community and political support. We were at the right place at the right time. People were looking for an underdog to root for."
All janitors will receive an immediate $500 bonus. Those in
outlying areas will get a 30-cent raise the first year, while those in more highly unionized downtown and Century City will get a 70-cent boost. Wages for all janitors will increase by 60 cents a year the next two years.
Stranger's Note: This settlement amounts to an approximate 8% per year raise for the L.A. janitors. Last week, flight attendants got an even better deal from Northwest Airlines. The point is, with unemployment so low, employers who wish to keep their doors open have no choice but to acquiesce in the face of such demands.
We have now turned 180 degrees from the day in 1981 when Ronald Reagan fired the air traffic controllers. In those days of Paul Volcker and very tight money, there were plenty of unemployed available to replace those who got too greedy. Today we live in an era of easy money and, realistically speaking, there are no unemployed. Workers are already getting the message of rising consumer prices and short-handed employers. Rising wage demands should now spread across the U.S. like wildfire.
By the way, 1981 was a great time to be selling gold. (Get it?)
Thank you, fellow forumites, for not making our Round Table an extension of the "Elian Gonzalez Channel".
What a stupid, stupid story. A stupid media, falling once again to its "O.J." level of reporting, in exploiting a child exposed to tragedy. Stupid political fanatics using a child. A stupid government endangering a child.
I look at my 4-year-old sleeping and I am angry. I feel vulnerable for her, and only by the law of probability are we likely to escape such idiocies. A nation that cannot avoid practicing child abuse even after the public spotlight is turned full brightness on the situation is in trouble. A decent silence seems impossible to them...
That said, I am sure to have offended someone (apologies extended), thus provoking the bane I warned of at the top, and will remain silent on the matter hereafter.
Legal Precendent Favors Pre-1933 Gold Coins as a Protection Against Confiscation
" In 1954, the Treasury Department recognized at last that the time had come to legitimize the numismatic gold market. Consequently, an amendment was made to the Gold regulations, to the effect that all gold coins minted prior to 1933 would subsequently be presumed to be rare and of recognized special value to collectors, without the necessity of further specific determinations by the Treasury. Coins minted after 1933 were still subject to specific Treasury Department rulings, which were to be base on the advice of the Curator of Numismatics of the United States National Museum. All U.S. gold coins and the vast majority of foreign gold coins were thus freed from the overhanging threat of confiscation, and a new era for American numismatics appeared to begin. " Donald Hoppe, 1970
----------------------------------------
Quote above excerpted from a detailed account by Donald Hoppe written in 1970.
As a major gold dealer from the era between confiscation (1933) and legalization (1975), Mr. Hoppe was well aware of the obstacles thrown before him and the ways to help gold owners get around them legally. Rescued and reposted by Silverbarron at the Kitco site a couple years ago, I think we are lucky to have Mr. Hoppe's account and chronology as it appeared in his book, "How to Invest in Gold Coins," still available.
I was struck by a couple of things in re-reading Mr. Hoppe's work:
First, how little has changed in the battle between hard-money advocates and the neo-Keynsians.
Second, how safe we actually are as owners of pre-1933 European fractional gold coins. It is not the perfect solution to the problem of confiscation (there probably isn't one), but it is the best solution. For the government to overturn all the precedent as listed below, it would require a sea change in a legal system built on precedent and jurisprudence. In addition, at the current low premiums (comparable to similarly sized bullion coins) for pre-1933 European fractionals, coupled with the historically unprecedented low constant dollar gold price, these items, in my opinion, are a steal. In my view, the minor premium you do pay at the outset will evaporate when gold responds to the inflationary policies of the world's governments and central banks.
I will reinforce this argument with one thought: Many of you are familiar with the oft-repeated dictum that down through history an ounce of gold would always purchase a top-quality man's suit. A top-quality man's suit now sells for $600 to $700. That makes gold undervalued at this juncture in monetary history by over half. Obviously, the small premium one pays for pre-1933 European fractionals now is minor compared to the peace of mind attained, not to speak of the fact that this premium would evaporate quickly in gold market bull induced by a failed monetary policy (something I believe we are in the middle of).
----------------------------------------
"How to Invest in Gold Coins" Donald J. Hoppe, 1970 - Chapter II
THE PRIVATE CITIZEN AND GOLD TODAY
Despite the patently obvious evidence of recent years that Gresham's Law is still
irresistibly in operation, the student of monetary history and crowd psychology
may yet have some reservations about gold investing. Before deciding on gold
coins as a safe and profitable investment, with the obvious advantages already
mentioned, one may properly question the extent to which man's historic faith
in the reliability of gold as a standard of value has been or will be affected by the
thirty-four-year campaign of the Keynesian economists to escape from the
restrictions and disciplines of gold-based money. ( The question is especially
pertinent because of the defection of so many so-called conservative economists
and bankers to the viewpoints of the New Economics. )
After all, we in what the French like to call the "Anglo-Saxon camp" have been
told for a considerable time now, through our press and by the pronouncements
of even some of our highest Treasury and banking officials, that gold, like the
Deity in the eyes of some modern theologians, is dead; that the use of gold for
monetary purposes or as a store of value is, in that already well worn clich�, a
"barbarous relic." Furthermore, it is said that the sooner we are able to abandon
it completely, the better it will be for us.
But perhaps the demise of gold as the center of the monetary universe has been
reported, as was the death of Mark Twain, somewhat prematurely. Although the
obituaries continue to be published, the world remains unconvinced. If gold is
indeed dead, it has proven to be a rather lively ghost. The author's clipping files
concerning monetary subjects indicate that more press copy on the subject of
gold has been published during the last two years that at any time since the crisis
years of 1933-34. Countless reports on the future of gold and the attendant
opportunities for speculation it offers have also been prepared by private
financial advisers and services ( and sold at high prices ) since the dying relic,
the "echo of the past" has suddenly become a full-blown crisis. Some went so
far as to declare that gold was America's number-one problem. But there is still
little public agreement on whether the ancient idol will be finally and forever
toppled from his throne or restored once more to past glory.
In the author's opinion, the decisive vote was give in 1967 and 1968, when
repeated waves of gold speculation swept the gold markets of the world,
shaking its very monetary foundations, breaking up the London gold pool and
its fixed $35 per ounce gold price and forcing the devaluation of the British
pound sterling. The most revealing part of these episodes was that they imposed
an ignominious retreat on the neo-Keynesian money managers of the West. In
being forced into a tightfisted defense of their stockpiles of monetary gold, the
position of the money managers would have been ludicrous but for the tragic
effects of the inflation that had already eroded the wealth and vitality of
countless peoples.
Ironically, it was these practitioners of the New Economics who had insisted all
along that gold was only a superstition, a vestige of a barbarous past, and that
we would have been better off to dump it all into the sea. But now that it has
apparently been found necessary, for the moment at least, for the United States
and its partners in financial experiment to defend at all costs ( that is, with
whatever further sacrifices may be required of their citizens ) what is left of their
monetary gold stocks, it may be suggested ( with tongue in cheek ) that we
dump our money managers into the sea instead.
However, it is obvious that the present show of defending gold by Britain and
the United States, through various austerity programs, exchange controls, high
taxes, etc., is a tactical expedient only. The ultimate goal remains the
implementation of some new international paper-money scheme, an eventual
total devaluation of the dollar, and the complete demonetization of gold.
Therefore, stability in the price of gold and an end to the long-term inflation that
has accompanied the ascendancy of the New Economics are nowhere in sight.
Additional waves of gold speculation, gold-buying panics and recurrent gold
crises are not only probable but inevitable.
What part the citizen of the United States and his British cousin have played in
these events has been somewhat restricted, legally at least, by the actions of
their respective governments. They have been prohibited by law and regulation
from direct participation in the purchase, sale or ownership of gold in bullion or
monetary form.
In most other civilized lands ( and some that are not so civilized ) the ownership
of bar gold and gold in any other form is not only permitted but, as in the case
of France and Switzerland, often tacitly encouraged. These enlightened
countries believe that gold in the hands of private citizens is an aid to internal
economic stability and complements rather that competes with the official
reserves of their central banks. By allowing the free use of gold as a store of
value, the other Western countries have eased somewhat the burden of inflation
upon their citizens. Unfortunately, the insidious disease of inflation is, as a
matter of record, chronic in every country that practices neo-Keynesian
economics. But by permitting the private possession of gold in any form,
France and Switzerland at least recognize that the least sophisticated and affluent
of their citizens should have the right to defend themselves.
The only other major nation, besides the U.S. and Britain, that prohibits free
commerce in gold by its inhabitants is the Soviet Union. Private holdings or
transactions in the yellow metal are considered there to be "economic crimes' -
most serious offenses in a Marxist state. Those engaged in them are subject to
the firing squad. ( Yet is has been reliably reported that a flourishing black
market in gold continues to exist in Russia and the other Marxist states )
Curiously enough, the writer finds that the parallel presented by the United
States and the Soviet Union, regarding the private holding of gold as an
infringement on a state monopoly and therefore a crime, is neither unbelievable
nor incongruous. Perhaps the "big brother" philosophy of economics is rather
easily recognized whatever its stage of development.
Worldwide, the record of the neo-Keynesian money mangers in the area of
maintaining the purchasing power of their fiat currencies has been deplorable.
But perhaps I am too harsh on the proponents of the New Economics; after all,
monetary delinquency antedates Keynes by a considerable period; it is of course
as old as money itself. The coin clippers and debasers caused as much ruin and
suffering in ancient times as the paper-money inflationists have in the twentieth
century.
But holding aside for a time further comments on the great questions concerning
future trends of inflation and the coming rise in the price of gold, let us proceed
directly to the problems and opportunities confronting people generally and
citizens of the United States and Britain in particular who might wish to
speculate on these possibilities, or who might want to invest in a gold-related
activity as a hedge. Since possession of monetary gold ( bullion ) by citizens of
the U.S. and Britain is unlawful, there remain only two ( legal ) avenues of gold
investment open to them: the purchase of shares in gold-mining companies, and
the collection of gold coins.
The gold coin was once a very vital part, at times the lifeblood, of the economic
body. Today is not so. The lifeblood of the New Economics is credit. The coin
of gold, the ancient king of money, was forced to abdicate in disgrace during
the depths of the Great Depression and it has been banished from the realm ever
since. But the gold coin still has a meaning, and sometimes a very profitable
one, for those who have the eyes to see it.
The provisions of the Gold Reserve Act of 1934 and the Executive Orders and
banking laws of 1933, which originally demonetized and confiscated all
outstanding gold coin in the United States, prohibited the individual possession
of gold bullion ( or any other recognizable use of gold as a store of value ) .
However, they made no prohibitions regarding the ownership of gold-mining
stocks, and they also permitted the retention of gold coins of "recognizable
numismatic value." Failure of the original legislation to define adequately what
constituted recognizable numismatic value caused considerable confusion for
some years, but in general, the parts of the gold regulations concerning
numismatics were not rigidly enforced - at least not to the point of harassing
collectors of gold coins.
It is now obvious that considerable quantities of U.S. gold coin were never
surrendered at the time of the original order. Some coin was withheld because it
was in the possession of foreign citizens, banks, or governments, and some
because its owners chose to defy their government because of what they
considered to be an arbitrary and unjust confiscation. Considerable quantities of
American gold coin also found residence in Canada. At any rate, choice
uncirculated U.S. and foreign gold coins were generally available through coin
dealers in the United States after 1934 and they sold at prices that from today's
vantage point were fantastically cheap.
Unusually strong demand for the more common gold coins, strictly as a
speculation on a possible rise in the price of gold or as a hedge against inflation,
occurred from time to time, notably in 1946, 1957, and 1961, but in general,
the market for the so-called common type of gold coins remained unexciting -
until 1967. In the truly numismatic area, however, astute and knowledgeable
collectors gradually reaped a tremendous reward for their patience. During the
postwar years, gold coins of unusual scarcity or rare numismatic value enjoyed
a spectacular and continuous rise in price.
In the forties and fifties, the U.S. Treasury held most of the world's gold
bullion, and consequently, the attitude of the government toward gold-coin
collectors was one of indifference, even though the legality of possessing
so-called common-date coins was somewhat questionable, at least until 1954.
Prior to that year, the Treasury held the opinion that it alone had the right to
determine whether or not any gold coin was of numismatic value.
Determinations were to be made on the merits of each individual coin presented
to the Treasury for ruling.
The pre-1954 criterion for judging a coin minted before 1933 was whether or
not the coin in question had possessed a recognized numismatic value on or
before April 5, 1933. Gold coins minted after 1933 were to be judged on the
basis of the number issued, the purpose for which they were issued, their
condition, mint mark, historical significance and other numismatic factors.
However, there appeared to be no great rush of collectors to the Treasury
Building to have their coins checked.
It must be admitted, however, that the Treasury Department of that era did not
rigidly or aggressively enforce a narrow and legalistic interpretation of the
"numismatic value" provision of the Gold Reserve Act. Had it done so,
American numismatics would have suffered severe and irreparable damage;
many fine gold coins which are now the prized possessions of American
collectors would have been lost forever. "Numismatic value" is a term of varied
and at times subtle meaning. Many regular-issue coins gradually become scarce
or even rare, through natural attrition, while they are still technically part of the
circulating medium, and these scarcity situations are invariably recognized at
first only by the most astute and sophisticated collectors. By the time the
numismatic value of such coins becomes common knowledge, it is usually well
past the point where that value or the potential for numismatic value was actually
acquired.
There is also the case of the unusually well struck or prooflike coin which was
selected from a regular issue; certainly this type of coin has exceptional
numismatic value even though the issue it was taken from was not particularly
scarce. And how does one objectively judge the roll of uncirculated coins put
away by the foresighted for the benefit of future generations of numismatists?
And specimen coins retained because of their artistic merit or historical
associations? Surely the final U.S. gold-coin series designed by Augustus St.
Gaudens, on of America's most noted sculptors, would fall into this latter class.
To have ruthlessly insisted on the surrender of all gold coins extant on or before
April 5, 1933, that were still technically part of the circulating medium, and/or
not obviously or generally recognized to be of unusual historic numismatic
value, would have been catastrophic indeed, as far as numismatics is concerned.
But the Treasury officials of that day chose to be tolerant, if not amiable, and,
except for prevent the importation of large numbers of post-1933 foreign gold
coins, did little to disturb numismatic gold activity. Apparently, numismatists,
collectors, and even hoarders were too few in number at that time to cause alarm
on the Potomac. Whatever the reason, we can feel thankful that the Treasury
authorities of the first quarter-century following the demise of gold coinage in
the U.S. did not flail about with the typical bureaucratic myopia that has
characterized their successors. In any case, the "common" U.S. gold coins (
which, as we know now, are anything but common ) and most pre-1933
foreign gold coins were allowed to be traded and collected more or less openly
during the years prior to 1954.
In 1954, the Treasury Department recognized at last that the time had come to
legitimize the numismatic gold market. Consequently, an amendment was made
to the Gold regulations, to the effect that all gold coins minted prior to 1933
would subsequently be presumed to be rare and of recognized special value to
collectors, without the necessity of further specific determinations by the
Treasury. Coins minted after 1933 were still subject to specific Treasury
Department rulings, which were to be base on the advice of the Curator of
Numismatics of the United States National Museum. All U.S. gold coins and
the vast majority of foreign gold coins were thus freed from the overhanging
threat of confiscation, and a new era for American numismatics appeared to
begin.
It might have been reasonable to expect after 1954 that further relaxation of the
Treasury's Gold Regulations, particularly as they applied to numismatics,
would be a natural development in time. But the subsequent course of American
economic history ruled otherwise. By 1960, the underlying inflationary
instability of the Western world had reached the point where the once seemingly
unlimited gold reserves at Fort Knox had noticeably begun to shrink.
This unfortunate ( and, in my opinion, wholly avoidable ) turn of events
precluded any possibility of further liberalization of the gold rules, numismatic
or other. Instead, in 1961, the Kennedy Administration saw the necessity of
establishing within the Treasury Department the Office of Domestic Gold and
Silver Operations ( ODGSO ) , in order to institute a more rigorous control over
the import and export of gold and silver, the licensing of jewelers, goldsmiths
and industrial users of gold, and import and sale of gold coins.
The most positive accomplishment of the new ODGSO was to reaffirm, as its
own policy, the 1954 amendments to the Gold Regulations, which ruled that all
gold coins minted prior to 1934 are rare and consequently of recognized
numismatic value. For gold coins minted after 1933, the office required a
separate ruling in each case and the issuance of a special permit for the
importation of possession of each post-1933 coin approved. ( Once an initial
ruling on a particular coin was made, however, no further permits or
applications were necessary to purchase or hold other coins of the same identity
within the United States, although a license to import any post-1933 gold coin is
still required, whether it has been previously approved or not. )
By some obscure and tenuous logic ODGSO also required ( until 1969 ) a
permit to import pre-1934 gold coins, even though the purchase or possession (
>
Easy Als' money has been flowing overseas via the current account deficit etc., hence "price stability, low inflation and the goldilocks economy" on this side of the pond.
When these dollars come home to roost (indicated by a decline on the FX markets) the gold bull will be underway in earnest as I understand things.
I agree that the crowing about M1 is misleading as this measure appears to have been shrinking and and doesn't paint the big picture.
gidsekView Yesterday's Discussion.