USAGOLD Discussion - July 2000

All times are U.S. Mountain Time

SHIFTY
(07/01/2000; 00:10:41 MDT - Msg ID: 33063)
NYPOST.com
From
NYPOST.COM



HOW INFLATION WILL WRECK THE ELECTION FOR AL GORE

By JOHN CRUDELE


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



GET ready for a major collision between the Fed and the White House this fall.
As everyone knows by now, the Fed decided to leave interest rates unchanged at its latest Open Market Committee meeting this week. In doing so it said some things to make those who want rates to stay put feel good, and some things that left open the door for higher borrowing costs as the year progresses.

If the economy does slow and inflation shows no signs of picking up, then the U.S. will be able to move into the election season without the Fed and the White House bumping heads. And that will be the end of the story.

But if the signals of inflation get stronger - and I'll explain why that's a very good possibility - then this election year could see the meanest, ugliest confrontation ever between the executive branch of our government and monetary authorities.

And the repercussions from such a battle will not be controllable by our officials. That's because foreign investors will get to cast their vote for the way the American economy is being handled by their treatment of U.S. dollar and financial markets.

The Federal Reserve has increased interest rates a half dozen times in the past year, starting with one last June that caught every single Wall Street expert by surprise.

The second hike also shocked the markets, which were hoping that the Fed was just tapping on the breaks to slow the economy. Even when the third rate increase came in the fall, Wall Street was still in denial.

Because the Fed didn't raise rates this week, Wall Street again has its hopes up that the Fed is finished. But don't get too blas� about the future.

First, the only moderately troublesome inflation reports that have been coming out of the government recently are an aberration at best and fraud at worst.

The Fed has already publicly questioned the government's inflation data, which showed consumer prices up 0.1 percent in May and producer prices flat.

What bothered economists is that Washington seems to have missed the incredible run-up in energy prices. And without those price increases, it is impossible for the Fed or anyone else to figure out how much the higher cost of energy is filtering through to other products.

But here's the problem.

The statisticians who put together the inflation numbers - especially those on consumer-price rises - say that the jump in energy prices was missed simply because of a fluke in their surveying system.

And they expect that the higher inflation numbers will start re-appearing with June's numbers. I spoke with them about this, and so have others.

The Fed's Larry Meyers has already called the government's May employment statistics "not credible" when it showed a decline in private industry jobs, a rise in unemployment and an increase in overall jobs because the Census Department hired an extraordinary number of temporary workers.

And Fed officials are constantly telling a few key private economics firms that they need help because the government's numbers are so unreliable.

Even if inflation stayed at current levels, prices are still up about twice as much over the past 12 months as the previous year. That alone should worry the Fed but it's only half the problem.

As this column has been saying for years, the Fed is mainly concerned with the stock market bubble. The "asset inflation" being created on Wall Street has long been bleeding into the economy and the fear is that the U.S. will reach production limits and prices will rise uncontrollably.

Stocks had only a modest reaction on Wednesday to the Fed's decision to keep rates steady and fell yesterday.

But the next interest rate meeting isn't until late August.

Here's the worst case scenario, which also happens to be the most likely.

Over the summer the stock market rises, creating more bubble money that investors will use to put a further strain on the nation's production capacity. At the same time, the inflation already imbedded in the economy will start showing up in the government's numbers on top of whatever new inflation is created by a further inflating of the bubble.

The end result will be a strong need for the Fed to increase interest rates right through the presidential election. This will give the Democrats fits.* Please send e-mail to:

jcrudele@nypost.com
View Yesterday's Discussion.

canamami
(07/01/2000; 05:38:30 MDT - Msg ID: 33064)
Reply to RAP - #33057
RAP,

Compliments on an informative and craftily worded post.

Are you arguing that a violent response to the current constitutional/governmental arrangements in the US could be justified? If yes, (a) would the existing debt of the US government or state governments be honoured? (b) would you retain the current US as a form of legal tender? (c) if not the US dollar, would gold/silver play a role in the monetary system?

It is interesting to note how much of history turns on arguing over debt: which one's will be honoured, which one's won't, and how they will be paid.

Most modern thought, IMHO, is focused on the pursuit of this-worldly pleasure - wealth, status, etc. Would most modern thinkers view the US revolutionaries who lost everything in support of their cause as "losers" or "suckers"?

It would be interesting to study whether some of the revolutionaries managed to use the new arrangements to directly or indirectly "make good" their losses, or to enrich themselves outright.

In my own personal experience, when I was younger, I would allocate significant efforts to advance a cause, without pay. Later, I learned that some of my associates insured they received payment for their allegedly voluntary efforts. The quandry: No cynical society can survive because no one will undertake the collective efforts (with risk of individual death, suffering, or impoverishment) needed to keep the society going. But in being an idealist, one must ensure that one is not paying a disproportionate price to benefit others. However, the need to protect oneself from being used can inhibit necessary but non-remunerative action, which means the necessary collective tasks don't get done. What to do?

An aside: The United Empire Loyalists would look at how their property was stolen by the US revolutionaries. Why were not these signers of the Declaration of Independence compensated from the looted or abandoned property of the Loyalists? If they weren't, who was compensated, and why?
Henri
(07/01/2000; 06:28:51 MDT - Msg ID: 33065)
Michael/Previously registered "Clink"
Just received my (first)10 tola bar. Long wait but what a beauty. Love the Pachiderm. Still waiting for my Uro's.

Michael have you had any luck in connecting with a supply of the Harmony issue's? I wish to add some more but am waiting to find out if our esteemed host can deliver. At these prices I don't want to wait too long.
Hill Billy Mitchell
(07/01/2000; 06:32:10 MDT - Msg ID: 33066)
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: June 30, 2000

Rates for Thursday, June 29, 2000

Federal funds 6.76

Treasury constant maturities:
3-month 5.85
10-year 6.04
20-year 6.24
30-year 5.88

upside-down spread FF vs long bond = (.88%)
Leland
(07/01/2000; 07:24:12 MDT - Msg ID: 33067)
Be Careful on the Highways This Holiday Weekend...
http://dailynews.yahoo.com/h/p/ap/20000630/en/earthling_traffic_oeo.htmlThere are a lot of crazy drivers out there.
JavaMan
(07/01/2000; 07:26:02 MDT - Msg ID: 33068)
Henri, re: tolas...
Congratulations on your latest acquisition. I seem to recall some posts a while ago about tolas but, alas, I have a good memory...its just too short. Can you talk more about your tola? Specs, turnaround time, etc.?

Thanks.
Journeyman
(07/01/2000; 07:50:40 MDT - Msg ID: 33069)
Re: Leland msg#: 33067 "Be Careful on the Highways This Holiday Weekend.."

Thank goodness they're protecting us from these-type vehicles!

Regards, j.
Leland
(07/01/2000; 08:12:13 MDT - Msg ID: 33070)
For Those Following Operation Sail 2000 This Weekend...
http://www.phillynews.com/content/inquirer/2000/06/23/front_page/sails23.htm.
TheStranger
(07/01/2000; 08:40:35 MDT - Msg ID: 33071)
A Must Read
http://www.prudentbear.com/guest.htm
"So what is [the] real rate of inflation in the US? It probably approximates growth in
total money supply, or M3. Since 1959, M3 has grown at a frightening
compound annual rate of 7.9%, while the CPI has "only" indicated 4.4%
compound annual inflation. The real per capita GDP, in the same period,
grew at a compound annual rate of only 1.4%, indicating the annual growth in
the broad money supply exceeded per capita GDP growth by an incredible
6.5% annually. More money chasing fewer goods equals inflation. With money
supply growth far exceeding per capita GDP growth for over 40 years,
inflation will get much, much worse before it gets better in the United States.

As this month's BLS results made crystal clear, the CPI is not a valid measure
of inflation, but has devolved into a mathematical Frankenstein's monster.
Real inflation, by any measure, is much higher than official Labor Department
statistics indicate. Sooner or later, general price levels will rise high enough
so everyone will be able to see through the statistical smoke and mirrors the
BLS has deployed. When that day comes, international faith in the US dollar
will plummet like a meteor, and hundreds of billions of dollars will be
dumped in the international currency markets in nanoseconds. The only
investment that has always thrived in highly inflationary environments in the
past is gold. Gold always retains its inherent, intrinsic value through all
financial turbulence, and shines its brightest when the demons released from
the Pandora's Box of inflation are wreaking the most havoc."

Stranger's Note: Be sure to click on the link and get the whole story.
Leland
(07/01/2000; 08:59:23 MDT - Msg ID: 33072)
Some Good News! From the Fine Folks in South Carolina (I Have a lot of Respect..Having Been Stationed There)
COLUMBIA, S.C. (July 1, 2000 8:29 a.m. EDT http://www.nandotimes.com) - A prominent South
Carolina video gambling operator kept an ace up his sleeve but despite the last-minute legal
maneuvers, the high-stakes battle ended with the industry folding.

The plug was pulled on the $3 billion industry at midnight Friday as a statewide ban went into
effect 14 years after video gambling was legalized in South Carolina.

"Bored. That's what I'm going to be - bored," said Wanda Rose, playing at the Double
Diamond in Columbia. "I mean, it's my money. I think that I should be able to spend it however
I want."

The end came only after a late-night legal drama that reached the state Supreme Court less
than two hours before the midnight deadline.

Businessman Henry Ingram, who owns five casinos, won a temporary injunction from a
Circuit Court judge allowing him to keep his video poker machines running. However, the
state Supreme Court shot that down late Friday night and denied other requests for
emergency injunctions.

Operators were supposed to have their machines turned off by midnight Friday. Authorities
had no immediate reports of violations.

"The last player had $100 that I was able to pay him," said Linda Browder, manager of Airport
Bingo in Cayce, which closed about 30 minutes before the midnight deadline. "I gave him his
$100 and his ticket as a souvenir. He said he would keep it."

Video poker became legal in South Carolina after a lawmaker slipped a provision into a bill in
1986. Anti-gambling forces fought hard to outlaw the machines, a battle that came to a head
in 1998 when then-Gov. David Beasley, a Republican, called video gambling "a cancer on
South Carolina" and vowed to get rid of the industry.

Gambling operators helped defeat Beasley's re-election bid, pouring money into the campaign
of Democrat Jim Hodges, who won the governor's race with a promise to let voters decide
whether the games should remain legal.

Last year, the Legislature approved a bill that banned video gambling unless voters decided in
a referendum to keep the machines. A few months later, the state Supreme Court threw out
the referendum, but upheld the ban.

"I'm glad it's out," Margaret Perry said as she played at D J's Video Games in Columbia. "It's
caused a lot of problems in my life. It's been a detriment to my spiritual life."

(Fair Use Protections Apply.)
goldfan
(07/01/2000; 09:19:44 MDT - Msg ID: 33073)
Murphy's site LeMetropoleCafe
http://www.lemetropolecafe.comI haven't been able to access this site for two days now. Is it being subjected to a span attack?? anyone else able to get through? Also I have the same problem trying to email Murphy's webmaster gbarnes@unicomp.org, can't get through.

grateful for a reply.
Goldfan
goldfan
(07/01/2000; 09:26:30 MDT - Msg ID: 33074)
LeMetropoleCafe.com
re my previous 330373, sorry, make that gbarnes@unicomp.net
goldfan
Leland
(07/01/2000; 09:41:49 MDT - Msg ID: 33075)
Appropriate for this Weekend's Musings...
The future of American
liberty rests in the hands of young people more familiar with the "Three Stooges" than the
three branches of government. According to a 1998 Luntz Research survey, 59 percent of
13- to 17-year-olds identified Moe, Larry and Curly while only 41 percent correctly cited the
legislative, executive and judicial branches.

As America celebrates 224 years of independence, one wonders if this nation's citizens are
equipped to defend their freedoms against the state's natural penchant for mischief. The
evidence should make you drop your hamburger.

The National Constitution Center interviewed 1,000 adults and found that 24 percent cannot
name a single right guaranteed by the First Amendment.

Only 6 percent can cite freedoms of speech, press, assembly and religion. Fifty-two percent
do not know the Senate has 100 members. One in six believes the Constitution created a
Christian nation.

Even well-educated adults seem confused about America's experiment in limited
self-government. The Rev. Joan Brown Campbell of the National Council of Churches
explained during the Elian Gonzalez saga that Juan Miguel Gonzalez planned "to simply ask
now that the attorney general issue a court order and that the boy be returned immediately to
him." Neither Campbell nor Brian Knowlton's April 13 International Herald Tribune story
observed that attorneys general may not issue court orders any more than judges may
prosecute suspects.

Indeed, no matter what people wished for Elian, one likely reason that two-thirds of Americans
applauded his abduction by a federal SWAT team is that they did not grasp the case's basic
legalities. The Justice Department should have secured a court order to transfer Elian from
his great-uncle to his father. Instead, Justice relied on a fraudulent search warrant that falsely
called Elian "an illegal alien" and "a concealed person," presumably hidden atop Lazaro
Gonzalez's backyard jungle gym.

Unaware of what the Constitution entails, affluent and disengaged Americans seem rather
comfortable with a kind of elective monarchy.

Every four years, they pick a king who governs largely as he wishes.

Members of Congress - like an American House of Lords - breezily conduct their own affairs.
The two divisions of the royal family occasionally cooperate, usually - but not always - within
the law.

Every other November, Americans decide which among them may keep their orbs and
scepters and continue ruling at their whim.

In August 1993, for instance, a Democratic Congress approved Bill Clinton's proposed hikes
in top income and estate tax rates retroactive to Jan. 1, 1993, despite the Constitution's
explicit instruction that "No Bill of Attainder or ex post facto Law shall be passed." Indeed,
Clinton's measure actually raised taxes on moneys earned during the final days of the Bush
Administration, before Clinton's inauguration!

Although the Constitution unambiguously states: "The Congress shall have the Power to lay
and collect Taxes," the Federal Communications Commission in 1998 imposed the $2.25
billion-per-year "Gore Tax" on telephones. Worse yet, the FCC forbids phone bills from
separately identifying this roughly 5 percent telephone tax as a tax, never mind the phone
companies' First Amendment freedom to communicate with their customers as they like.

Congress voted last July 15 to accept a 3.4 percent salary increase, effective Jan. 1,
regardless of the 27th Amendment's requirement that compensation changes commence
after "an election of Representatives shall have intervened." Lawmakers feathered their beds
by dubbing this unconstitutional pay hike a "cost-of-living adjustment." The media and
masses snored right through this shakedown.

America's public cluelessness begins in schools that teach little about English and the
sciences and less about government. Sen. Joseph Lieberman, D-Conn., joined members of
the American Council of Trustees and Alumni on June 27 to call on "educators at all levels to
redouble their efforts to bolster our children's knowledge of U.S. history and help us restore
the vitality of our civic memory." A major overhaul of America's classrooms - through charter
schools, vouchers or total privatization - would boost the odds that citizens will learn why this
country is so special and how to keep it that way.

Meanwhile, Americans would be wise to heed the man who penned the Declaration of
Independence on July 4, 1776. "If a nation expects to be ignorant and free," Thomas Jefferson
said, "it expects what never was and never will be."

New York commentator Deroy Murdock is a Senior Fellow with the Atlas Economic
Research Foundation in Fairfax, Va.

(Fair Use For Educational/Research Purposes Only!)
SHIFTY
(07/01/2000; 11:15:03 MDT - Msg ID: 33076)
Goldfan
I just checked the Cafe and its working. I cant stay online due to my wife's mom having a by-pass this morning. Waiting for news. There is a new post by James Turk . I have not read it yet. Need to get off computer to keep phone line open.

$hifty :)
Leland
(07/01/2000; 11:15:06 MDT - Msg ID: 33077)
And, There is Sadness This day....
Actor Walter Matthau Dies at 79

By Bob Thomas
Associated Press Writer
Saturday, July 1, 2000; 9:43 a.m. EDT

SANTA MONICA, Calif. �� Walter Matthau, the foghorn-voiced movie
villain who became a master of crotchety comedy with his Oscar-winning
"The Fortune Cookie" and followed with "The Odd Couple," "Grumpy
Old Men" and many other hits, died Saturday morning of a heart attack.
He was 79.

Matthau was pronounced dead at 1:42 a.m., shortly after being brought
into St. John's Health Center in Santa Monica, said hospital
spokeswoman Lindi Funston.

Often cast as a would-be con man foiled by life's travails, Matthau
bellowed complaints against his tormentors and moved his lean, 6-foot-3
frame in surprising ways.

Said his frequent costar, Jack Lemmon: "Walter walks like a child's
windup toy.

Matthau's performance as the shyster brother-in-law of Lemmon in "The
Fortune Cookie" won him the Academy Award as best supporting actor
of 1966. He was twice nominated for best actor: as the cantankerous
oldster in "Kotch," 1971 (directed by Lemmon); and as the feuding
vaudeville partner of George Burns in "The Sunshine Boys," 1975.

"The Odd Couple" provided the role that established Matthau's stardom.
In 1965 he appeared in New York as the slobby sportswriter Oscar
Madison in Neil Simon's play. Art Carney was the fastidious
photographer, Felix Unger, who shared an apartment with Madison after
both had been divorced.

Matthau repeated the role in the 1968 film, with Lemmon as Felix. They
reprised their roles 30 years later in the 1998 film "Odd Couple II."

"Every actor looks all his life for a part that will combine his talents with his
personality," Matthau told Time magazine in 1971. "'The Odd Couple'
was mine. That was the plutonium I needed. It all started happening after
that."

The actor could be as whimsically eccentric in interviews as he was on the
screen. Reporters had to exercise caution in separating fact from his flights
of fancy.

In responding to a form for Current Biography, he reported that his father
had been an Eastern Orthodox priest in czarist Russia who ran afoul with
church authorities by preaching the infallibility of the pope. His father was
actually a Kiev pedlar.

Matthau declared that he had married the former Carol
Wellington-Smythe Marcus. His wife was really Carol Marcus, who had
been twice married to playwright William Saroyan.

"That's my defense mechanism against pompous and ludicrous questions,"
Matthau explained. When he filled out his Social Security form in 1937, he
listed his middle name as Foghorn. He never corrected it.

Some of the facts about the actor's early life seem accurate. He was born
Walter Matuchanskayasky on Oct. 1, 1920, in New York City to
impoverished Russian-Jewish immigrants.

The father left home when Walter was 3. Walter and his older brother,
Henry, lived with their mother, a garment worker, in a series of cold water
flats on the lower East Side.

Young Walter showed a dramatic bent early, reading Shakespeare at 7
and reciting poems in school assemblies at 8. He was introduced to
Yiddish plays at 11, when he sold soft drinks at 2nd Avenue theaters. He
made occasional appearances onstage at 50 cents a performance.

He was already 6 feet tall at 10 and weighed 90 pounds. "When I drank
cherry soda, I looked like a thermometer," he once cracked.

Graduating from Seward Park High School during the Depression, he
took government jobs � as a forester in Montana, gym instructor for the
WPA, boxing coach for policemen. In World War II, he enlisted in the
Army Air Corps and served as radio cryptographer in a heavy bomber
unit in Europe.

Matthau ended the war a sergeant with six battle stars and a fistful of
money from poker winnings. Legends of his gambling followed him
throughout his life. While making a TV series in Florida before his movie
stardom, he lost $183,000 betting on spring-training baseball games.

The actor himself made no effort to quash the legends and even
contributed to them. In middle age he estimated his lifetime gambling
losses at $5 million.

After release from the Air Corps in October 1945, Matthau enrolled in
the dramatic workshop at New York's New School. Among his fellow
students: Gene Saks, Rod Steiger, Harry Guardino, Tony Curtis. He
stayed three years, living on the GI Bill and playing in regional stock during
the summer.

Matthau's first Broadway role came at the age of 28 when he was hired as
understudy for the role of an 83-year-old English bishop in "Anne of the
Thousand Days," starring Rex Harrison.

When the aged English actor playing the role became ill, Matthau went
onstage without a rehearsal. He liked to tell the story of how the surprised
Harrison looked at him and uttered an expletive. Matthau related: "People
in the audience began muttering to each other: 'Did he say "Oh, spit!"?'"

A series of flop plays followed, then Matthau hit a lucky streak with "Will
Success Spoil Rock Hunter?," "Once More with Feeling" and "A Shot in
the Dark." Hollywood took notice.

His first film, "The Kentuckian" starring and directed by Burt Lancaster in
1955, cast him as a villain, and more heavy roles followed. Among the
early films: "King Creole" (Elvis Presley), "A Face in the Crowd" (Andy
Griffith), "Lonely Are the Brave" (Kirk Douglas), "Charade" (Cary Grant,
Audrey Hepburn).

He also appeared on dramatic TV shows such as "Playhouse 90" and
"DuPont Show of the Week," and starred on the short-lived series
"Tallahassee 7000."

"The Odd Couple" and "The Fortune Cookie" elevated Matthau to
stardom, and he enjoyed a wide variety of roles for more than 30 years.
He appeared in action thrillers such as "The Taking of Pelham One Two
Three" and "The Laughing Policeman," and portrayed a U.S. Supreme
Court justice in "First Monday in October." He even did a musical, "Hello
Dolly!" costarring with Barbra Streisand, with whom he publicly feuded.

He was always identified with comedy, something that rankled him.

"When people come up to me and say, 'Aren't you that comedian who's in
the movies?' I want to throw up," he once complained. "I throw up a lot."

Matthau was often teamed with Lemmon, always as adversaries though
they were best friends offscreen. Their films included: "The Front Page,"
"Buddy Buddy," "Grumpier Old Men," "Out to Sea."

Among Matthau's other films: "Cactus Flower," "Plaza Suite," "Pete 'n'
Tilly," "Casey's Shadow," "California Suite," "Little Miss Marker," "I
Ought to Be in Pictures," "Pirates," "Dennis the Menace."

He was most recently on screen with Meg Ryan, Diane Keaton and Lisa
Kudrow in movie "Hanging Up," released in February.

Matthau was married to Grace Geraldine Johnson from 1948 until their
divorce in 1958. They had two children, David and Jenny. He married
Carol Marcus in 1959, and they had one son, Charles, who became a
filmmaker and directed his father in "The Grass Harp" in 1996.

The actor survived several serious health setbacks during his career. While
making "The Fortune Cookie" in 1966, he suffered a serious heart attack.
His doctor attributed it to smoking three packs a day and constant worry
about gambling and told him to give up both. Matthau stopped smoking.

In 1976, he underwent heart bypass surgery. After working in freezing
Minnesota weather for "Grumpy Old Men" in 1993, he was hospitalized
for double pneumonia. In December 1995 he had a colon tumor removed;
it tested benign.

He was also hospitalized in May 1999 for more than two months after
another bout with pneumonia.

Matthau attributed his various illnesses to his eating habits: "If you eat only
celery and lettuce, you won't get sick.... I like celery and lettuce, but I like
it with pickles, relish, corned beef, potatoes, peas. And I like Eskimo
Pies, vanilla ice cream with chocolate covering."

(A Great Loss! And Fair Use Protections Apply.)
Henri
(07/01/2000; 13:21:13 MDT - Msg ID: 33078)
Java Man Msg 33068
I would love to tell more but alas, the "rules". If you were to find the link to Harmony Mines webpage there is another link there. Clues only lest I find myself deprived of the fellowship of my peers. I fear I may already be in transgression. If so, forgive my impertinance Michael.
Journeyman
(07/01/2000; 14:16:19 MDT - Msg ID: 33079)
Test yourself against von Mises. Six questions for ALL

1. Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?

See how your answers to these questions stack-up against Ludwig
von Mises, the esteemed founder of the Austrian School of
Economics. WARNING: Many of the "answers" von Mises gives are
NOT multiple choice. You may have to engage your mental gears.

I'm going to post Mises' quotes (with a bit of commentary on a
couple of them) one at a time at irregular intervals over the
next few days, so tune in often!

Regards,
Journeyman
JavaMan
(07/01/2000; 14:40:23 MDT - Msg ID: 33080)
Henri...
No problemo...I thought MK was offering them. If not, maybe he should.

As an aside, there was a little known band, Osa Bisa, I think, in the early '70s that used the Pachiderm on their album covers. The ears where so big as to allow them to fly. Incredible art work.

Leland
(07/01/2000; 14:50:28 MDT - Msg ID: 33081)
Sir Journeyman, Your Test is Mind Stimulating
A good von Mises website..

Ludwig von Mises Papers Discovered in Moscow

In March 1938, the Nazis occupied Austria. They broke into the apartment of Ludwig von Mises,
who was away teaching in Geneva. The Nazis took all the papers and correspondence of this
Austrian economist they considered their most important intellectual enemy. At the end of the war,
the communists confiscated the papers (38 boxes, 20,000 items) and transported them to Moscow.
Now, more than 50 years later, the papers were discovered by 2 researchers in a secret Moscow
archive.

At a time when Socialism was the rage in Europe (1920s), Mises was its most vehement critic. In his
much talked about book, Socialism, Mises exposed socialism as a utopian scheme that is illogical,
uneconomic, and unworkable at its core. Because of his views, he was feared by European leaders
and was consequently denied an academic post at a major university. In 1940, he sought refuge in
the U.S. where he continued to write and teach until his death at age 88 in 1973.

Mises, the most famous economist of the Austrian School, was passionately committed
to freedom and to capitalism. He never stopped his fight against socialism, or any sort
of government intervention, which he concluded was unproductive, unstable and would
only lead to more government intervention.



"Ludwig von Mises did more to spread the fundamental ideas of free markets
than any other individual." -- Milton Friedman, Nobel Laureate


A champion of freedom, private property and free markets, Ludwig von Mises is
author to 25 books and over 250 articles, including his masterpieces: Human Action,
Socialism, Planned Chaos and The Theory of Money and Credit.

To find out more about Ludwig von Mises, contact The Ludwig von Mises Insitute
in Auburn, AL or visit their web site at www.mises.org, or email them at:
lvmises@mises.org.
Farfel
(07/01/2000; 15:12:04 MDT - Msg ID: 33082)
@STRAT and DISNEY@ Raving Lunacy Re: Gold Leasing
I still like to peruse Kitco, mostly for humor content, and today's posts on gold leasing are hysterical.

Now it seems Disney and Strat have come up with a methodology for Central Banks and Bullion Banks to make money in the gold market WITHOUT any gold leaving the CB vaults. Moreover, they assure us that this methodology is correct because bullion banker "expert", Lenny Kaplan attests to its validity. Yes, that's Lenny Kaplan, the very same man who periodically posts @Kitco to tell everyone that gold is no more than a mere industrial metal commodity today (yet assures us that he is just a trader with no negative bias toward gold???).

According to Diz and Strat, it seems that, in order to earn a whopping 1% on their gold reserves, CB's are happy to BUY gold (on paper) at spot price around $290 (a helluva lot of money to put up in order to earn a mere 1% ROI), thus allowing the BB's to earn 6%, while the CB's never part with a single ounce of gold through the entire process.

DUUUUH? So how does the 1500 ton annual global gold deficit get filled if the CB's are engaging in mere paper transactions without gold leaving their vaults????

Never a day goes by where gold investors don't receive healthy doses of negative gold propaganda from both gold shorts and plain simple idiots.

Still I enjoyed the laugh.

Thanks

F*

schippi
(07/01/2000; 15:57:52 MDT - Msg ID: 33083)
Wavelet Chart of Select Gold
http://www.SelectSectors.com/wavelet.gif All componets are pointing Up!
Have a GREAT 4'th
TownCrier
(07/01/2000; 16:10:14 MDT - Msg ID: 33084)
Sirs Henri, Javaman, and all others with an eye toward gold acquisition
When the topic of Harmony's own branded 10 tola (3-3/4 oz.) gold bars was brought up at the forum a couple months ago, Michael said at that time that if you good people expressed an interest or desire in acquiring some Harmony gold for your portfolios then Centennial would look into tapping into the supply line. It might be helpful if anyone with a serious potential interest would let us know (e-mail reaches me here at The Tower if you send it to the sitemaster's address listed at the top of the forum).

This situation is very much like the one in which the Bundesbank recently announced plans to mint one million 11.8 gram one-mark gold coins next year as part of a program to foster "monetary and currency stability consciousness" among the general public, according to the Bundesbank's press release. Based upon clientele demand, Centennial will look into offering these coins if they can in fact be had in the U.S.

I, for one, have an interest in both.
SHIFTY
(07/01/2000; 17:08:21 MDT - Msg ID: 33085)
Periodic ponzi update ( PPU )
Nasdaq 3966.11 + Dow 10,447.89 = 14,414.00 divide by 2 = 7,207.00 Ponzi

Up 81.96 ponzi points from last weeks close.

$hifty
Aristotle
(07/01/2000; 19:28:55 MDT - Msg ID: 33086)
Loose ends
http://www.usagold.com/hall/hallfame2.htmlORO, sorry for the poor continuity in my attempt to engage you in discussion regarding some of your comments. Over two weeks ago I had asked you to more clearly define the meaning of the lie that governments and banks sell to the public as stated in your latest Hall of Fame entry, and only now am I getting around to this intended follow up. I hate to come across as being nit-picky, but we have so thoroughly covered the fundamentals, discussion of nuances and details are seemingly all that's left to us.

As it is, I have misgivings about the applicability of this "selling a lie" notion of yours -- while at the same time I do certainly acknowledge that it makes for good copy ("sex appeal") here at a forum of gold advocates such as myself. As a reminder, you said, "The public has been sold both the fiduciary gold and the fiat debt money as supposedly workable monetary systems. Governments and banks know this is not the case." Unfortunately, in my specific case, this now falls on deaf ears. I have for a long enough time in years past beaten my head against the wall trying (in vain) to "expose the fraud" of paper money, and yet the unavoidable and "inconvenient" truth of the matter was that the relatively smooth functioning of the marketplace in modern days has proven this position to be wrong. Let's face it--every real Gold advocate would call for the immediate collapse of each and every paper currency, and must admit consternation or else claim some form of sorcery from the "powers that be" with each passing day that paper currencies continue to function. I used to be among this crowd. (I will offer some more posts on this topic later.)

This is not to say that paper currencies are as good as Gold. Far from it. But as I look around with untainted eye, I fail to see the masses that are accepting paper dollars against their will. To the contrary, most people would love to have many more of them. And as long as that is the case, the "lie" you propose to exist seems to have given way to something else. It would seem that each passing day for several decades would serve as testimony that "fiduciary gold and fiat debt money as supposedly workable monetary systems" have not only been "workable systems," but must in fact be declared as incredible successes in the minds of us sceptical Gold advocates in particular. [We see this as just cause for your own reevlauation, ORO, as you suggested in your HoF post--"Quite frankly, the detachment of gold from the currencies would eliminate the benefit of having them. Any attempt to inflate would destroy the currency values."] As it is, and as the world seems to function in modern times, I had to change the lenses through which I viewed the world in order to make sense of it all and to proceed forward with anything approaching a sane and rational existence. To insist daily that the Sun cannot workably rise in the East, contrary to daily observations, is to surely get oneself committed to an institution. Perhaps your own error is in thinking that a "workable" system has to be the BEST system, which it decidedly does not have to be, and currently is not.

To be sure, some "modern" currency systems have had better track records than others, but even the worst among them have worked, and the people using such systems quickly adapt to either use it to their advantage or else make the best of what it has to offer. But of course, you would have me believe instead that the following dictum is at work: "You can fool all of the people some of the time, and you can fool some of the people all of the time--and that is usually good enough." My personal view of the situation is that there is no "selling" and no outright "lying." Instead, we have various systems in use throughout the world, and as with any diverse population of people, we have diverse levels of understanding with regard to the nature of their currency system and its relationship to real wealth. Those with regular exposure to the most unstable of workable currency systems have had little trouble seeing things for what they are. Ask them if they are being "lied" to, and the answer will surely be, "No." Similarly, we are not being lied to in America. It's just that the general level of optimism or contentment regarding the "infallible dollar" is perilously high and firmly entrenched in the minds of many who would do well to recognize the potential for a downside. With such awareness comes the natural desire for individuals to diversify into Gold as their form of wealth savings. Herein rests Gold's untapped potential for an astounding rise in both price and relative value.

There were two other items I wanted to raise about your post. You wrote--"1. Gold IS THE MONEY: The core of the financial system is gold." Here I beg to differ. I would suggest that the core of the financial system is The Effort to Service Debts. As for what Gold is the "core" of, Gold is the core of the Wealth Universe--of all items it is most reliably accepted in trade at all places at all times for all things; it can even be swapped for any currency as needed. Hence, its value as savings.

You continued your point with the comments--"The profits of trade are placed in rarities and gold. Like all profit motive operations (the only motive) the 100% of the enterprise exists because of the expected 15%-20% gross margin, the gross margin is only important because it provides the profit which can be invested or stored. Investments earn a return, gold is what is returned and not reinvested. Traditionally, a 3% net profit is all that is necessary, thus 97% of trade can be done without gold, but the only justification for the 97% is the 3% that will be put into gold."

Again, I must beg to differ. To see otherwise, we need only to look at the wide world filled with practical experience to the contrary. How many millions of people are out there engaged in various enterprises with one motive or another who have absolutely never given any thought to Gold in their entire lives? Not only do I question the Gold motivation, I also question the reliability of the 3% net profit business. Whereas you say these "profits of trade are placed in rarities and gold," I would suggest that the motivation and profits of trade are represented by getting something ELSE that you need as a byproduct of your specialization to produce very efficiently more items of a single kind than you personally have any need for. That's what division of labor is all about. Seen this way, the notion of "profit" flys. We could conceivably all be content with "Break Even," getting precisely an equal value in return for our effort. We toil for shelter, food, and clothing as the "profit" (motive, actually) for our single-purpose efforts that modern division of labor and commerce allows. The Profit comes in where we toil and exchange in excess of our immediate personal needs. This becomes the Wealth that we accumulate. And where food spoils and storage of goods are problemmatic, we turn to Gold...or else many of our peers take their currency and turn to speculation or various investment schemes to, as they say in Vegas, "Let it ride!" Good luck. There's nothing wrong with that as long as they are fully aware that they are gambling with the product of their past efforts.

The second item I wanted to question you about was your comments regarding hyperinflation. You said rising prices causes less currency to be held in banks, leading to currency shortages, and with rising prices ultimately leading to loan defaults, whereby, "Defaults destroy bank assets and the banks must sell assets to obtain cash with which to settle. The defaulted loans are no longer a source of demand for currency, and so the value of the currency erodes further."

How do you rectify the logic and the outcome you've established in that example of defaults with what can be reasonably expected to occur with the value of Gold upon a similar default on Gold loans in the bullion banking sector? I'm sure we are all in agreement that the value of Gold would increase, yet you say the parallel with currency has an opposite effect. Are you neglecting the bank's own obligation to cover the defaulted loan in the first (currency) example?

And on the topic of maintaining similar logic between one banking system and another, Bill Murphy said upon his return from Paris --"There is much at stake. If the buildup in [Gold] derivatives is as significant as we think it is and the gold loans are as large as we think they are, the gold price will soar." While I don't question that outcome for Gold, why can't it also be argued under the same driving principles that "if the buildup in DOLLAR derivatives is as significant as we all know they are, and the DOLLAR loans are as massive as we know they are, then the DOLLAR will head for the stars."?

Just an effort to stimulate some additional quality thinking.

Gold. Get you some. ---Aristotle
The Invisible Hand
(07/01/2000; 19:51:30 MDT - Msg ID: 33087)
TG's return
Before he started travelling, TG told us that, upon his return, the gold trail would be red hot.
I would like to know when TG will return.
Perplexed
(07/01/2000; 20:21:57 MDT - Msg ID: 33088)
Lest we forget Thanks RAP for message 33057

DEMOCRACY--I WANT--THEREFORE I'M ENTITLED


Common sense, as well as experience tells us that:
# 1, everything, including government, must have a source, or creator. # 2, the created is forever subservient to
the creator. # 3, the human race, created in the likeness and after the image of a creator capable of self government and self determination, inherited these capabilities, and thus acquired the attendant responsibilities.

To Thomas Jefferson, the author of the Declaration of Independence, the absence of individual right to life, liberty and property, relegated birth to the status of an exercise in futility, he concluded therefore, that they must have been an endowment of our Creator.

The protection of these endowments became the basis of a radically new form of constitutional government. As an interpretive aid, our nations founders later spelled out
the philosophy behind this document in an addendum which came to be known as the Bill of Rights. However, because circumstances of the time precluded its establishment, the
complete government envisioned in the Declaration of Independence is still in our future.

The caterpillar must die, that the butterfly may emerge, and so it is with government. The human race, as beings created in the image of our creator, at any given time, are limited only by the scope of knowledge available at that particular time. We are on an endless and unlimited journey, and, at this time, neither perfect science, nor, perfect government is possible. As our level of knowledge multiples, so also does our options; in the interim, existing knowledge serves to meet the challenges of a particular time, place, and circumstances, in an ever changing present.

While the concept of self determination was, in my opinion, revealed by inspiration of God, the government required to fulfill this Godly mission was not miraculously created. It was to be a work in progress, constructed bit by bit, involving billions of people, with no time restraints, until it extended world wide. Though in constant, evolutionary flux, at any given time, the government required for the next step down the path will have evolved sufficiently to meet the continuing challenge.

As the government given birth by our nations founders comes of age, and gradually sheds its democratic cloak, mankind will take a giant step down the road of government evolution, toward a more perfect government.

But a democracy is the perfect government, our President glorifies it, our preachers create surmons around it, our teachers proclaim it in grade school, university degrees are bestowed upon it, and even Tom Brokaw confirms it from my television.

O.K, if they are right, then why was it, rather than the republican form of government, not guaranteed in our Constitution? I'll ask one of them: Mr. Madison,
we know that it was considered at the convention, so why didn't you just create a government of majority rule? His reply per the Federalist Papers: Democracies have ever
been spectacles of turbulence and contention and have been found incompatible with personal security or the rights of property, and have in general, been as short in their lives as they have been violent in their deaths."

This statement, based upon a long knowledge of history, was short and to the point; words of wisdom which have been with us for over two hundred years; an admonition which we apparently do not believe worth pondering, and certainly not worth following, as we continue to build "our democracy," and wonder why our nation is in turmoil.

As current conditions continue to validate Mr. Madison critique of democratic government, perhaps an analysis of our brief experience with it will tell us why he has
proven so successful a prophet. This analysis begins with (a.) the Constitutional guarantee of a republican form of government to every state; (b.) a determination of exactly what is comprised by the term" republican," and (c.) a reference to the first ten amendments to the Constitution.

The basis of our government is not the Constitution, it is the Declaration of Independence. According to this document, the protection of individual rights is the purpose of government, the Constitution was written to accomplish this task.

The amendments, known as the Bill of Rights, offers an absolutely infallible platform from which to determine exactly the definition accorded the term "republican
form of government" by the "experts" themselves, the founders of our nation. We find: Every one of these amendments takes power from the mass, and deposits it with the individual. They build upon the standards set forth by The Declaration of Independence which recognizes the existence of a creator and further states the purpose
of government to be the security of the endowment of rights, to life, liberty and the pursuit of happiness.

Because we are created individually, not in mass, these
endowments originate at the individual level, and apply to all mankind at this level. Just remember, they are not gifts, they are required elements for self determining
individuals, the purpose for which were created.

These principles are borne out by the Declaration of Independence, which states, that any government created to secure these endowed rights, is to be established, not by
the creator to rule the created individual, but by the created to govern themselves, deriving its just power from the consent of the governed. Because the endowments of
life, liberty and the pursuit of happiness, pertain to the created individual, the term, "governed", is imbodied, not in the mass, but, in full measure within each individual.
* This was considered blaspheme by the Christian Church of the time. They taught that government was a creation of God; they performed Coronations of Royalty,(and still do) and decreed that the individual was obligated to submit to those in government who had the "rule" over them.*

According to the government our founders selected, this consent, is delegated,not as surrendered rights, but as authority, to citizen representatives, chosen by majority ballot, who then comprise the government; thus, the will of the majority extends only to the selection of those hired to serve as our representatives. They then derive their just authority as well as limitations from their employment contract, the Constitution, (but only after taking an oath of obedience to that document).

Because individual rights existed prior to the Constitution the term Constitutional Rights is a misnomer, the individual citizen enjoys Prior Rights, Constitutionally guaranteed, there is a vast difference.

The only rights created by the Constitution, were those necessary for the function of government, which were then delegated to the representatives as authority. They become enhanced rights when exercised within the parameters set forth by the Constitution, in which case, those enumerated rights, do indeed take precedence over individual rights, voluntarily subjugated to government.

The responsibility of hiring those suited to the task, including education and character, rest with us, the governed. If, through usurped authority, or for other reasons, the government becomes detrimental to the welfare of the individual, the duty, to either alter or abolish it, and the establishment of another, which in our opinion, is suited to the task, also belongs to we, the governed:
Per The Declaration of Independence.

In essence, we are the governors--Governor.

Under this system, government is entitled only to the authority possessed by each individual citizen, that which doesn't exist individually cannot be delegated massively:
translation: If I personally cannot take your home, car, or gun, then neither I nor you possess anything to delegate to our representative. (1,000,000 x 0 equals 0)

This barrier to majority rule, represents the stabilizing factor necessary to fulfill the mission of a just, thus peaceful, governed society. Are these conclusions borne out
by actions of our nations founders? Yes! As previously noted, the first nine amendments to the Constitution were specifically written to deprive the government of rights, while the tenth was intended as unambiguous insurance against "interpretive" license.

Do circumstances arise within a Republic in which the welfare of the mass takes precedence? Yes. And they are provided for within the Constitution.

A COMPARISON TO WHAT WE NOW HAVE

Mr. Madison's statement recognizes the folly, and anticipates the answers to questions that cut to the very heart of direct democracy. As an example: In a democratic
nation, what percentage of the electorate should be required to empower the government to confiscate Private property? Private Industry? Private land? In the final analysis does
the initial figure really matter, it can always be changed by the will of the majority, right?

Our founding fathers were also aware of the fact, that the basic principles of democracy treat all created wealth as common wealth, to be used at the sole discretion of
those currently in power. Representatives of government thus must find the means of harvesting the wealth, as well as determining the amount to which each citizen is entitled.

It takes no genius to associate money spent at the right time and right place, and re-election. Ad the: "I'll vote for your pork if you vote for mine", and the "yes I know it
violates the Constitution but this is an emergency", plus the outright prostitution of the office to special interest, and you have four, of an endless list of causes, for the failure of the democratic form of government

Authority bestowed to selected individuals through the deferral of rights, is itself mitigated by restrictions, natural limitations, and common sense application, to be a given. Because self government of the mass must derive from self governing individuals, behavior, if abhorrent to the
individual citizen must also remain abhorrent to the citizen representative. Society, merely for convenience or desire, cannot exempt the mass, nor those formulating and enforcing the law, from that law, without also exempting the individual.

When was the last time any member of our "democratic" government was subjected to this standard? The last time I checked, it was being run according to "polls" taken to determine what exactly the citizens will allow the representatives, including the president, to get away with. The list included, but was not limited too, perjury, conflict of interest, coercion, witness tampering, bribery, breach of national security, immoral conduct, sexual harassment and influence peddling at every level and department of government.

The necessity of enforcing any law, although approved by the majority, with the effect of taking life, or appropriating the value of private property without just
compensation, precludes its universal acceptance. Regardless of the "democratic " approval percentage, because the law derives from authority which doesn't exist, it becomes a criminal act by society, compounded by enforcement procedures.

Any procedure, purposely designed to ensure the legality of the taking of life or property by individuals or society, is not only unlawful, but rather, by institutionalizing a precedent, serves to compound the act. After all the I's have been dotted, T's crossed, and the guns of " law enforcement " used to finalize the proceedings--theft remains theft--society's credibility and thus its viability is compromised--the individual assumes the same " might
makes right " attitude, and the rush toward oblivion accelerates. The events in Waco by government and the bombing in Oklahoma City by individuals are very vivid examples.

In a democracy the power belongs to those in the position to influence public opinion, the press in effect become the "King Makers". Is there any doubt that in a society which gets most of its news from television, that we are being "educated" as what to think, and what we want.

We are being offered our " choice " of purchased, packaged,
and merchandised politicians. According to our vote, or lack thereof, one of these "chosen " few becomes a part of our "leadership," and they in turn are influenced by the
polls to " give " us what we have been educated to won't, even if it requires taking it from someone else--this is "capitalist democracy" in action, the reality of majority rule.

Even in its limited form, it has crippled our government's ability to govern, as the escalating chaos,
violence, and barbarity attest.

Because trust is the glue which binds a free society. Just as society enjoys the right to expect the individual to honor the trust invested in them, the individual enjoys the
reciprocal right of being granted trust by society, until they, by their actions, prove unworthy of that trust. If the penalty for individual breach of trust is the loss of respect by society, then the opposite is also true. If failure to exercise individual self government constitutes a crime against society, necessarily resulting in the loss of individual sovereignty, then the stripping of individual rights without just cause or due process, constitutes a criminal act by society. Consequently, just as a criminal act by the individual results in status transformation, the same is true as it relates to society. As surely as the
advantages of obeying the rules of society is destroyed, chaos replaces tranquillity

One of the laws of physics states that for every action there is and equal and opposite reaction. This same principle applies to society. Every unlawful act, whether by the individual or government representative is replete with consequences. If the individual perpetrating the crime is not required to suffer the full consequences of his or her actions, then society picks up the tab. Every time some judge puts another criminal back into our midst, he is transferring the consequences of the crime, to the society.
How much more turmoil must we subject ourselves too before we recognize this fact? How much farther must our society deteriorate before we began to understand that
every time we utilize the "democratic shield" to shelter government representatives from the consequences of their actions, we tear another hole in the fabric of our society? How can we condemn our children for their lack of respect for the common laws of the land, while displaying our own contempt for these laws by disregarding them when perpetrated by "government"?

James Madison made the statement at the birth of this nation that: "This Constitution is suitable for governing a moral society, and is wholly inadaquate to govern any other." Again Mr. Madison has proven to be a very accurate prophet. Criminal activity within our society has become so prevasive, and our criminal justice system so complex and expensive, that we must now make "deals" with the most vile of criminals because we can no longer afford to prosecute them, nor to adaquately incarcerate those which we do manage to convict.

And Mr. Madisons Constitution? Well our judges just interpret it to accomodate the current situation and prevailing form of government. Even as our federal government grows progressively more powerful and exponentially more corrupt, a few of us were still
alarmed by an utterance of our "Vice" President "that he is bound by no controlling legal authority," however, most of our fellow citizens appear to have recognized and accepted this statement of truth, as old "news."

Unfortunately this truth is applicable to our entire federal government. No one in authority, is willing to hold another in authority, responsible for their conduct, a condition
which elicits and interesting question: In a nation whose welfare is predicated upon self government, if individuals elected to serve in government are devoid of this attribute,
and, additionally recognizes no external controls over his or her conduct, doesn't it follow that this conduct becomes a conduit, by which the poison of lawlessness is transmitted to the whole of society?
The culprit we are told is an outmoded Constitution which must be constantly re-interpreted. To a degree this is true, the Constitution was far from perfect, The flawed rendering of the term "all men", as contained in the
Declaration of Independence, in the restrictive gender connotation, rather than "mankind" the inclusive species interpretation cost us a war plus 140 years of evolution. This hypocritical failure to implement through government, the previously stated intent of the creator, that every individual, regardless of race, creed, color or gender, was created with the ability, and thus the responsibility, of self determination, guaranteed the war that was to follow 70 years later, as well as its result.

Until we are all entirely free to reach for the endowment of our creator, the brass ring of peace, will remain just out of reach of us all.

THE CATIPILLER IS DYING BEFORE OUR EYES, LETS PRAY FOR A SUCCESSFUL BIRTH OF THE BUTTERFLY!
Still perplexed
Aristotle
(07/01/2000; 21:34:21 MDT - Msg ID: 33089)
Excellent commentary, and excellent timing
Perplexed,
that was certainly one of the finest offerings I've seen at the forum, whether it be on or off the topic of Gold. Your post IS Gold! Seeing your political philosophy laid bare as such, I am even more pleased to have seen you weigh in during the past as a ***supporter*** of the FreeGold scenario.

All my best to you on this Independence Day weekend.

Gold. Get you some. ---Aristotle
Journeyman
(07/01/2000; 22:36:36 MDT - Msg ID: 33090)
Why has the word "inflation" become confusing?
http://www.mises.org/humanaction.asp
Question 1: Why has the word "inflation" become confusing? What
are the results of this confusion?

The semantic revolution which is one of the
characteristic features of our day has also changed the
traditional connotation of the terms inflation and
deflation. What many people today call inflation or
deflation is no longer the great increase or decrease
in the supply of money, but its inexorable
consequences, the general tendency toward a rise or a
fall in commodity prices and wage rates. This
innovation is by no means harmless. It plays an
important role in fomenting the popular tendencies
toward inflationism.
+
First of all there is no longer any term available
to signify what inflation used to signify. It is
impossible to fight a policy which you cannot name.
Statesmen and writers no longer have the opportunity of
resorting to a terminology accepted and understood by
the public when they want to question the expediency of
issuing huge amounts of additional money. . . .
+
The second mischief is that those engaged in
futile and hopeless attempts to fight the inevitable
consequences of inflation--the rise in prices--are
disguising their endeavors as a fight against
inflation. While merely fighting symptoms, they pretend
to fight the root causes of the evil. Because they do
not comprehend the causal relation between the increase
in the quantity of money on the one hand and the rise
in prices on the other, they practically make things
worse. . . .
+
It is obvious that this new-fangled connotation of
the terms inflation and deflation is utterly confusing
and misleading and must be unconditionally rejected.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 423 [XVII. INDIRECT EXCHANGE 6. Cash-Induced and
Goods-Induced Changes in Purchasing Power -available also from
http://www.mises.org/humanaction.asp]

Regards,
Journeyman

In case you tuned in late, this post is Mises "answer" to
question 1. of the following six posed in an earlier post:

1. Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?
Sierra Madre
(07/01/2000; 23:34:26 MDT - Msg ID: 33091)
De Gaulle's reference to "extravagant privilege"
What the General was referring to, was the privilege which the U.S. and Britain granted to the U.S., of having its paper money (which was at that time fiduciary media, that is to say, notes PAYABLE in gold at one ounce per $35 U.S Dollars) to be considered as prima facie reserves on the books of whatever foreign Central Bank happened to acquire these promissory notes of the Federal Reserve,AS GOOD AS GOLD. The "extravagant privilege" comment referred to the fact that no other country in the world could send its promissory notes abroad, to be used as reserves,in the Central Banks of the World.
This meant that the U.S. could purchase whatever it pleased in the world, with money issued by the Federal Reserve, essentially only promises to pay gold; after purchasing whatever its citizens, corporations, banks, etc could wish to purchase, these purchases were (and still are!) paid only with promises. This "extravagant privilege" could be made a little easier to understand with a simmpler term: "FARMING THE WORLD".
The U.S. Dollar as reserve currency of the world, is the greatest scheme of looting ever devised by the mind of man.
At present, the U.S. is looting the world at the rate of over $400 billion a year (trade deficit), which is the Dollars that go abroad to "pay" for imports to the U.S. And now, of course, the Dollars are no longer redeemable in gold - just papers! So it's an even more "extravagant privilege". (From fiduciary media, to fiat money)
Actually, there is no payment until an equal amount of goods flows from the U.S. to the rest of the world. Until that time, this process is simply tribute collected from a largely willing, because ignorant, world. That's the great U.S. economy, whose experts attempt to show the rest of the world how to do things.
Well, they can't show the rest of the world, because the rest of the world has to take the Dollars as reserves, or else...devaluation, financial collapse, capital flight, political destabilization.
That's the "extravagant privilege". But, what goes around comes around: the result is similar to what happened to the Roman Empire: the looting from the rest of their conquered world displaced working people and destabilized their agriculture, and created masses of idle Romans who had no employment and relied on the imports of wheat (by the Imperial Government) from Egypt to eat. They didn't have T.V. but they had circuses...paid for by the State.
Hope this piece helps someone understand a little more!
ORO
(07/02/2000; 03:19:38 MDT - Msg ID: 33092)
Aristotle - comments, installment 1
Aristotle

First, the workability issue and the apparent performance of the current currency system.
The boom and bust cycles of monetary inflation, at first at the credit level and then at the monetary base level are well known and innate features of debt money. They parallel the gold debt boom and bust cycles that central banks introduced. The latest such cycles were 1913-1929 expansion, 1929-1933 contraction. In the Bretton Woods system it was 1946-1966 expansion, 1967-1971 draw down of reserves, 1971 break. The current cycle in the gold markets is exactly as its predecessors in principle, though many features are not the same. The contraction phase - the deflationary phase of the central bank gold systems is equivalent to the stagflation/hyperinflation phase of the pure debt money systems.

The indirect gold backing of the dollar that FOA and ANOTHER imply and I think exists, is going to collapse in a deflationary manner in the paper gold market, and in a stagflation/hyperinflationary manner in the dollar that has been hitched to gold in paper form. As you noted later in your post, the short covering of dollar derivatives seems absurd. When dollar derivatives collapse, the source of value of the currency - the source of demand "to repay debt", disappears. The derivatives of gold do not CREATE the current demand for gold but serve to displace it and dilute its value as they are CREATED to fill the demand. The two phenomena are exactly opposites of each other.

The funny money systems can survive through periods of 100% annual price inflations - these survival mechanisms are built around indexing to prices - banks offer and demand indexation to the CPI or an equivalent, governments index their bonds, people index their wages, and the construction and composition of the CPI is heavilly scrutinized whenever there is doubt as to its reflection of price levels. The growth of such systems in inflation prone countries removed the benefit to government and banking of inflating the money supply as people form a habit of carrying nominally calculated debt and indexed assets. The people competed with government as to how quickly they spend the funds they don't have yet. The people won the race. Sounds wierd, but that has been my personal experience in such periods.

I will add that when this happens, the government and the banks (usually having been nationalized due to bankruptcy) will attempt to provide a stable substitute system that will retain people's confidence till the next credit expansion causes prices to take off.

While wide popular understanding of what is happening in the currency valuation dynamics of nations with a heavy inflationary tendency does improve substantially, it does not mean that alternatives are understood, nor is it understood that the lack of wild devaluation of paper money purchasing power at one point in time serves as a predictor of it happening later.

The stability of the dollar and the currencies of industrialized nations are primarilly outcomes of the support of the dollar through a few mechanisms that sop up the international dollar supply. The bulk of them are:
1. Dollar debt traps
2. Central bank reserve holdings of dollar assets

Both are deliberate mechanisms. Both have been constructed for the political purposes of sustaining the dollar and the US economy at the expense of Europe and later at the expense of both Europe and dollar debtors. The Bretton Woods concept of backing the dollar with gold so long as no substantial conversion occurs is reproduced faithfully in the current floating rate system with a gold "kicker". Goods from our creditors and from the other debtors back the value of our currency. Just as no gold came out of America when the redemption of dollars into gold occurred, so will the dollars on central bank books and investror's accounts will not buy substantial quantities of goods from the US when "more dollars" will no longer denominate their desired return on investment.

View Yesterday's Discussion.

Jason Happy
(07/02/2000; 05:13:28 MDT - Msg ID: 33093)
Links to Silver resources
Solomon Weaver,

Once again, I spent some time online, trying to find out the elusive answer: how much silver is left out there?...

Here are a few of the best online links that I have found that have information about silver. If anyone here finds that these present a compelling case for investing in Silver, I would recommend buying 90% silver coins dated 1964 from our usagold forum host. Ordering is as simple as dialing the phone: (800) 869-5115

http://www.gold-eagle.com/research/butlerndx.html
http://www.gold-eagle.com/silver_section/reports.html

http://www.kitco.com/pda3992.html

http://www.sentex.net/~resource/slvr98-1.htm

http://www.silverinstitute.org/news/pr24may00.html
http://www.gfms.co.uk/html/f_silver.htm

http://www.cpmgroup.com/
http://www.cpmgroup.com/silver.htm
http://www.cpmgroup.com/free.htm
http://www.cpmgroup.com/msimon_auvsag.html

http://www.ajpm.com/pages/why.html

http://goldsheet.simplenet.com/silver.htm

http://www.silverassets.com/assets.htm

http://www.metro.net/cam/#anchor705277
http://www.metro.net/cam/camnewsletter.html
http://www.metro.net/cam/#anchor329194
--silver mining companies listed at the silver page

http://www.hecla-mining.com/
http://www.hecla-mining.com/reserves.html

http://www.apexsilver.com/

http://www.panamericansilver.com/
http://www.panamericansilver.com/market.html
http://www.panamericansilver.com/market/fundamentals.html


The following are interesting quotes from articles written from 1995 to 1998, that specifically mention the dwindling above ground supply of silver:

Keep in mind that Warren Buffet bought his 130 million oz. silver to be shipped to London in 1997, announced in late '97? early 1998?
------------------------------
From:
http://www.cpmgroup.com/msimon_auvsag.html
Total world stocks of silver in bullion and coin form are estimated to have stood around 850 million ounces at the beginning of 1995. By the end of the year they are estimated to have dropped to 700.0 million ounces. This reduction of total silver bullion holdings, to a level equivalent to approximately one years worth of silver use, is one of the subtle changes that occurred in 1995.

The silver market was filled with rumors about one or two large institutional investors 'buying up all of the silver,' but the reality of the matter is that the investment buying in the silver market, throughout 1993 - 1995, has been broad based.

As silver stocks became more scarce over the course of the year, this tightening had an effect on prices. Prices shot higher in April, when the dealers who had been selling New York Comex futures and options had their bluff called. A large volume of Comex call options for May delivery were exercised. With insufficient physical metal available to cover these short positions, dealers had to scramble to cover their positions, pushing prices sharply higher. By early May prices had shot up to an intraday high of $6.22. Later in the year, other incidents reinforced the realization that silver supplies indeed were tight. As discussed earlier, bankers and metal traders were surprised to find that, despite the appearance of large amounts of silver in London vaults in the middle of 1995, the metal was held by investors and did not represent metal available to the market without a significant increase in prices. Silver lease rates also rose sharply in the second half of 1995, for the first time in more than a decade, presenting market participants with yet further evidence that something real had changed in the silver market.
------------------------------
From:
http://www.cpmgroup.com/survey96launch.html
Probably the most important, and most interesting, issue facing the silver market in 1996 and beyond is how much silver remains in inventories, either in bullion or bullion coin form.

I mentioned the 640.5 million ounce decline in inventories over the past six years. It is CPM Group's estimate that by the beginning of 1996 reported and unreported silver inventories worldwide totaled less than 700.0 million ounces. In other words, roughly half of the silver stocks that had been accumulated up to 1990 appears to have been used over the subsequent six years.
------------------------------
From:
http://www.metro.net/cam/#anchor329194
A classic approach is to look at the supply demand fundamentals. According to the CPM 1998 silver survey on page ten, the December 1997 reported and estimated Silver inventory was between 767 and 972 million troy ounces. Government stocks are 167.5 million ounces. The annual shortfall is approximately 200 million ounces. If we use the high figure, then in about five years there is no more silver and again the price reaches toward infinity. Again this is ridiculous, but does indicate the trend. It is most interesting to note that the CPM data indicates that the amount of silver is four times more scarce than gold. Again using the world gold councils figures of four billion ounces of gold above ground. This is interesting that four billion ounces of gold are available at some price and only one billion ounces of silver are available to the market at some price. The most refreshing fact is that the silver inventories are primarily out of government and banking control.

By definition if the electronic money has a good possibility of going to zero, that infers that precious metals have no limit.
------------------------------
From:
http://www.sentex.net/~resource/slvr98-1.htm
...COMEX inventories ... have been dropping to 12 year lows near the end of 1997. These inventories were down 31% on the year as of Oct/1997. The CPM group, as of Dec. 31 1996 has estimated unreported inventories are somewhere between a low of 102M ozs. and a high case scenario of 327M ozs. No matter how you look at things, inventories are getting dangerously low.

------------------------------
My note to myself in July '99, was that there was about 400 million ounces of silver in above ground inventories in the world.

Today, July 2000, the COMEX is down to 100 million ounces;
Warren Buffet has 130 million ounces; And there are about 1450 coin dealers online? My personal experience with coin dealers is that they are comfortable holding $100,000 in silver; at $5.00/oz, that's 20,000 oz. each shop x 1000 = 20 million ounces; relatively insignificant amount, yet might be considered to be held in "strong" hands, ie, not let go if there are limit up days back in New York.

Once again, I suggest to all forum lurkers who still have money to invest to get some actual physical silver before supply runs out completely...

(800) 869-5115 toll free phone
tedw
(07/02/2000; 05:34:39 MDT - Msg ID: 33094)
US vs. Emerson
http://www.usagold.comTo Steve H and all patriots everywhere:

The officical position of the US Justice Department is that
the individual US Citizen has absolutely no second amendment rights under the Constitution. It is a right only of the national guard. They are arguing this in court.

Check it out at www.frontpagemag.com

In keeping with the spirit of this position, I hereby dub
the Department of Justice, the Department of Injustice.
Canuck
(07/02/2000; 07:18:04 MDT - Msg ID: 33095)
@ Stranger
Thanks for the link re: Inflation (Prudentbear).

I have been very conscious of the price of 'eggs' while shopping of late and its difficult to find anything that has not increased in cost.

I still get a little lost following the 'paper' aspects of gold (shorts,futures,derivatives, etc) but there is a couple
things I do know for sure.

a) The POO chart from your link (msg 33071) is interesting.
A rough average from 1987-1999, excluding the Gulf War spike
has oil in the $17-$19 range. Oil for 2000 must be averaging
close to $30; global demand dictates this price. The global
economies are firing on all cylinders. As you might say, too
much global money chasing too little oil. So, when does oil
come back down. When economies collapse and not before; barring a left field event, ie. OPEC decides to lower the POO because they feel sorry for us? Right.

b) The company I work for sells hardware. Every office I walk into has a new P3 on each desk, connected to a zillion
gig server. The office has a new phone system, voicemail system, fax, photocopier, cells. etc,etc. All these machines are running on the latest and greatest software. Why? All these systems and sub-systems were upgraded last year (Y2K) and with the money sloshing around last year, it was easy. Second quarter earnings and growth numbers from the hardware/software giants might be interesting.

c) Gold is not far above production cost. Lower POG will bankrupt marginal producers reducing supply rallying gold.
Lower POG stops exploration reducing future supply rallying gold. IMHO, gold less than $225-250 is impossible. Can one buy anything lower than the price to produce it?

The 'crazy canucks' celebrated Canada Day yesterday (133 years young); suffering from some sort of cerebral disorder
today manifested by lingering too long in a tent where the serve a frothy liquid causing one to sing the National Anthem severely off key.

Hope our American friends have a safe and mildly rowdy July 4th.

Canuck.
Mr Gresham
(07/02/2000; 08:12:28 MDT - Msg ID: 33096)
Aristotle #33086 -- A thought
The difference between gold and fiat's seems to be the eternal tension between Man's successes and Nature's endurance.

My wife and I just had a semi-argument about our recent spending of "too much time" (read: two extra days of my relaxing from driving in Italian traffic) in the lush green Tuscany countryside ("nothing for me to do there") vs. in the cities. "Exactly my preference," say I, remembering the pheasant calls I had learned to recognize.

I had that time to imagine the Roman legions passing through those valleys on their way to maintain the Empire. The city that passed into history is obliterated by another on its site. The countryside remains a much closer replica of itself of 2000 years ago.

The 14 towers of San Gigminiano (survivors of 90 towers at one time) -- built and manned by (90?) warring families just down the street from one another.

Man can cook up some amazing constructs. The power of illusion. The power of agreement. Fiat currency, like gold, is NOT really anyone's liability. But it exists and carries value by mutual agreement and expectation. This could change at ANY moment -- but probably will not vanish overnight. So the only question is when and how. Once we have prepared our golden refuge, we may join others as curious observers to our own species' glorious folly.

Do gold advocates want to strip away all their illusions? All their flawed and self-deceiving agreements? We couldn't if we wanted to. They will do it to themselves, in time. Just not when we think they ought.

Nature created gold, just as it created Man's genetic code, and occasionally Man has to acknowledge Nature's work as more enduring than his own. But "not just yet, please... let us roll the dice/pull the handle/deal the cards just one more time..."
Mr Gresham
(07/02/2000; 08:38:16 MDT - Msg ID: 33097)
Aristotle #33086 -- Oro's numbers
You critique Oro's use of some fairly specific numbers:

(---You continued your point with the comments--"The profits of trade are placed in rarities and gold. Like all profit motive operations (the only motive) the 100% of the enterprise exists because of the expected 15%-20% gross margin, the gross margin is only important because it provides the profit which can be invested or stored. Investments earn a return, gold is what is returned and not reinvested. Traditionally, a 3% net profit is all that is necessary, thus 97% of trade can be done without gold, but the only justification for the 97% is the 3% that will be put into gold.")

I want to speak up for Oro's doing this on several occasions (international debt trap, USD seignorage, etc.) because he helps me put some concrete dimensions to some concepts which until then were largely anecdotal. I think that way, too, and will extrapolate personal numbers from macro situations to frame my thinking, but not to run my business by.

("Hmmm, 40% tax rate plus 8% inflation plus 20% for missing time with my kid and 20% for tiring me out, and finally 20% for my wife's spending the additional: Think I'll go fishing Saturday instead of to the office.") (This facetious example is NOT comparable in seriousness to Oro's efforts. Since I'm in the tax business, I see all the ways that money taxes us, and ask "Where's my take-home?")

What I'm trying to say is I don't take Oro's analysis completely literally ("numerically"?) when he does this. It's beyond "back of the envelope" but it's meant to illustrate and further a discussion, not to present predictive statistics.

In the case of the 3% figure for gold, he gets me thinking about the wealth that passes through generations, mediated by the rise and fall of families, of corporate empires, and has to be re-earned in new lives and new ventures. It is both the insurance against old age and family upheaval, and one fruit of enterprise (which may have ripened alongside many other fruits if we look astutely).

3% also sets a realistic long-term expectation of accumulation in an era when polls reveal that our neighbors and co-workers expect upwards of 25% annual gains on their "savings". Sheeesh!

Two fine minds meeting -- just trying to grease the interface!





Leigh
(07/02/2000; 10:28:34 MDT - Msg ID: 33098)
Who's Buying All That Paper Gold
http://www.lemetropolecafe.comThis is a quote from today's long and VERY interesting Midas: "Jim Reilly, a Partner at Goldman Sachs and top commodity dog, told a delegate at the FT World Gold Conference that if buyers come in to push up the price of gold to $310 or $320, Goldman Sachs would offer unlimited amounts of gold paper to keep the price from going beyond that point."

OK. Now -- Aristotle, I WILL NOT continue to pester you, so I am throwing this question out to whoever wishes to answer. Who is buying all that paper gold? The middle class scorns gold in any form. Politicians and billionaires are buying physical gold. Goldman Sachs seems confident that it can sell unlimited amounts of their worthless paper, but to whom?

Thank you to anyone who is willing to answer!
Leland
(07/02/2000; 11:01:33 MDT - Msg ID: 33099)
Goes Public in 1998...Smashing Success...Then Smashes on June 2l
http://www.sunspot.net/content/archive/story?section=archive&pagename=story&storyid=1150350216136I'm reading more and more about "hot" stocks going down the
tube, like the one above.

The market bubble is getting popped by too many of these
hot companies now going into bankruptcy.

More conservative investments, like gold, should soon become
beneficiaries.

Michael, I'm thinking about ordering some more gold coins.
(And, my wishes to you for a very pleasant Independence Day
weekend!)

Journeyman
(07/02/2000; 11:34:48 MDT - Msg ID: 33100)
What did Charles DeGaulle mean by "extravagant privilege?
http://www.usagold.com/gildedopinion/bigfloat.html
Questiion 2: What did Charles DeGaulle mean by "extravagant
privilege? What's another little-used word for it? What would
happen if "the privilege" were exercized world-wide?

Sierra Madre, your answer looks good to me! And here's what von Mises had to say, theoretically, and long before DeGualle spoke of "it" as an "extravagant privilige":

Let us assume that the international authority
[or, say, the Federal Reserve -j. ] increases the
amount of its issuance by a definite sum [of credit
money or paper/megabyte money -j. ], all of which goes
to one country, Ruritania [no, America -j. ]. The final
result of this inflationary action will be a rise in
prices of commodities and services all over the world.
but while this process is going on, the conditions of
the citizens of various countries are affected in a
different way. The Ruritanians [no, Americans] are the
first group blessed by the additional manna. They have
more money in their pockets while the rest of the
world's inhabitants have not yet got a share of the new
money. They can bid higher prices, while the others
cannot. Therefore the Ruritanians [no, Americans]
withdraw more goods from the world market than they did
before. The non-Ruritanians are forced to restrict
their consumption because they cannot compete with the
higher prices paid by the Ruritanians. While the
process of adjusting prices to the altered money
relation is still in progress, the Ruritanians are in
an advantageous position against the non-Ruritanians.
When the process finally comes to an end, the
Ruritanians have been enriched at the expense of the
non-Ruritanians.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 477 [XVII. INDIRECT EXCHANGE 19. The Gold Standard
-available also from http://www.mises.org/humanaction.asp]

What Charles DeGualle meant by "extravagant privilege" was the
"privilege" of printing paper currency that is used in countries
other than the one in which it is printed. As a matter of fact,
it is also an extravagant privilige within the country where it
is printed.

This Mises quote should sound familiar to regular readers of this
forum. Because the Federal Reserve has been "expanding credit,"
sending "dollars" overseas in various forms, Americans are
somewhat in the position of the Ruritanians; we've been enriched
at the expense of the non-Americans.

The other darker side of the coin, however, is the evolution of
"Big Float." (If you don't already understand "Big Float" see
the link in the header.)

The other name for the extravagant privilege? Seigniorage.

Regards,
Journeyman

In case you tuned in late, this post is Mises "answer" to
question 2. of the following six posed in an earlier post:

1. Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?
ET
(07/02/2000; 12:23:57 MDT - Msg ID: 33101)
Sean Corrigan
http://www.lewrockwell.com/orig/corrigan7.html
From Lew Rockwell's site:

"The Bubble to date has run on the usual weary themes of our forefathers
- an overabundance of cheap credit, usually combined with innovations
in monetizing it, mass participation, often aided by advances in
communications, and the promise of boundless wealth based on the
fruits of Man's own natural genius.

"To see the Bubble end, we need to see at least two - and possibly all three
- of these factors fade out or reverse."
Chris Powell
(07/02/2000; 12:48:24 MDT - Msg ID: 33102)
Report on the FT conference: The emperor has no gold
http://www.egroups.com/message/gata/501?By GATA Chairman Bill Murphy.


To subscribe to GATA's dispatches by email
and get them immediately so you don't have
to go look for them, send an email to:

gata-subscribe@eGroups.com
John Doe
(07/02/2000; 13:36:07 MDT - Msg ID: 33103)
Who's buying the paper gold

Leigh

"Goldman Sachs seems confident that it can sell unlimited amounts of their worthless paper, but to whom?"

Although some of the "gold paper" leaks out to a few unsuspecting parties (and fewer all the time), I believe Goldman Sachs and its accomplices have the size and are perfectly able to create and maintain this sort of market all by themselves.

Their real challenge is to off-load the exposure of their past "interventions" onto another entity, preferably to some government taxpayers, the general investing public, their stockholders, or to a competitor.
JavaMan
(07/02/2000; 13:42:33 MDT - Msg ID: 33104)
(No Subject)
http://www.nationalreview.com/dissent/dissent061300.htmlWhile browsing mises.org for answers to "the six questions", I stumbled upon this article:

We've Got Inflation Now. The Fed's real problem.
By Gene Callahan, contributor to the Ludwig von Mises Institute

"But a rise in the price of one commodity cannot "generate" inflation. If the price of oil rises without an increase in the money supply, the only possible results are a shift of spending from other goods to oil, or a decrease in the amount of oil used. After all, without more money available, how could consumers spend more than they previously did on oil and at least as much as they previously did on everything else?"

Click on the link above for the rest of the article.
Strad Master
(07/02/2000; 14:13:59 MDT - Msg ID: 33105)
Leigh
Speculative answer to your question.I really don't know too much about all the inner workings of big commodity houses like Goldman Sachs, but it seems to me that since the entire Gold market is relatively thin and since most long-side speculators (especially in the paper markets) are extremely skittish, GS wouldn't have to put out too much paper to tank the price - at least that is the hope they are betting with. I may be all wrong so don't take this as anything other than a guess.
Leland
(07/02/2000; 14:54:15 MDT - Msg ID: 33106)
@Strad Master
You may be entirely correct about the commodity brokers,
and I've often wondered if the lack of transparency in
the gold market is "churning", where one arm of the same
company is selling to another "arm" in order to control
prices. I keep hoping Billy Murphy will help us all
unravel the confusion.
HI - HAT
(07/02/2000; 14:58:19 MDT - Msg ID: 33107)
Leigh..........msg..33098__________Goldman Gold
Is It A Real Snake ? OR Just A Piece Of Rope ?Hello to you. I find it extremely unlikely that a Goldman partner would make a statement like that, at this stage of the game, unless there is a BIG motive for doing so.

If anything I think the real truth when the paper gold game goes TOCOM, is Goldman will be in the "Position",to "GUT" the other players.

One must always remember that they are one of the Mother snakes of the Federal Reserve System.

Treacherous Vipers of whom if you ever hear public statements of them "talking their BOOK", expect the complete opposite of what they say they are going to do.
Leigh
(07/02/2000; 15:21:52 MDT - Msg ID: 33108)
JavaMan, Strad Master, HI-HAT
Thank you for your answers! I was wondering if GS is about to begin a campaign to make paper gold the coolest new investment in town. Can't you just see them next week on CNBC, talking about how the public is beginning to fear inflation (unnecessarily, of course!) and how holding paper gold will diversify an investor's portfolio and protect against volatility.

The investing public will line up to buy paper gold, and Goldman Sachs conveniently will be right there with an unlimited supply.

You see, I've been racking my brain trying to figure out who is buying these things nowadays. I know some very wealthy people who look askance at the mention of gold (no, they're not bluffing). The middle-class investors that I know are still hanging in with the stock market. It would take a major, brilliantly designed PR campaign to bring investors back to gold - but to paper gold and not bullion.
Leland
(07/02/2000; 17:27:04 MDT - Msg ID: 33109)
The High Price at the Pumps is Hitting Overseas, Too
July 1, 2000, 12:42AM
Gas prices have Europeans fuming
By BRUCE STANLEY

LONDON -- Although gasoline prices traditionally are higher on this side of the Atlantic, typically
submissive European consumers are clamoring for relief from worsening pain at the pump.

From Britain to Hungary to Finland, the outrage at rising gas prices sounds almost, well, American in its
intensity.

"Prices are outrageous," seethed Budapest book publisher Tamas Bekes.

"It's madness," said Valerie Khoury, a housewife in suburban Paris.

European motorists are long accustomed to paying as much as four times what Americans shell out for
a tankful of gas, because of fuel taxes that can add a staggering 80 percent to the retail gas price in the
region. Nonetheless, they have become more dependent on their cars, for pleasure as much as for
work.

"The car for Italians is a habit, a tradition, like spaghetti," said Italian taxi driver Michele Di Russo at a
filling station in central Rome. "Gas prices will not affect its usage. The car is entertainment."

As in the United States, where prices have soared in some areas to more than $2 a gallon, recent
increases in the price of crude oil used to make gasoline are sending prices up. The cost of unleaded
gas has risen by 16 percent in France, 14 percent in Italy and 11 percent in Belgium over the past year.

There are few signs that resentment at the increases is ferocious enough to boil over into a consumer
rebellion.

"People have been bludgeoned by one successive rise after another. We're so used to them, we've
become desensitized," said Michael Johnson, spokesman for the Automobile Association of Britain.

According to Johnson's organization, the average price in June for a gallon of unleaded gasoline in
Britain was $4.94, more than twice what Britons paid a decade ago.

Norway is the only European nation with costlier gas, at $5 a gallon, the AA said. France is the next
most expensive, at $4.23, followed by Italy, Germany, Portugal, Austria and Spain.

The difference from one country to the next is mostly because of government taxes, which in Britain
and France account for more than 80 percent of the price of gas. Finland had the next highest fuel tax,
at 78 percent, followed by Belgium and Poland at 75 percent each, the AA said.

This tax bite has left some motorists feeling passive and powerless.

"We can't really do anything about it. It's in the hands of the government," said office worker Norah
Lydon, who spoke as she filled her tank in the London suburb of Edgware.

An average 27 cents of every dollar that Americans spend at the pump goes toward taxes. Thus the
tripling in world oil prices since December 1998 has caused gasoline prices to spike more dramatically
in the United States than in Europe.

"It's just not the big deal here that it is in the U.S. because the price is masked by tax," said Jeremy
Elden, an oil and gas industry analyst at Lehman Bros. in London.

Klaus Rehaag of the Paris-based International Energy Association argued that the U.S.-style car
culture is not as strong in Europe, where large cities have good public transportation and are linked by
dense rail networks.

But discontent over gas prices appears widespread and rising.

"Prices are just ridiculous," said Risto Hyvonen of Helsinki, Finland. "I don't drive any less now. But
whereas before I used to tank up at any old gas station, now I look for special offers."

The Finance Ministry in neighboring Sweden has received 80,000 letters in the past few months alone
protesting its 70-plus percent tax on gasoline, ministry spokesman Haakan Boberg said.

Public pressure already has proven effective in Austria. Last month, the Austrian state-owned oil
company agreed to trim 2.5 cents off each gallon of unleaded gas after automobile clubs and labor
groups complained that the country's prices were among the highest in Europe.

In Germany, costlier gas is forcing up prices for taxi rides, pizza deliveries and even emergency visits
from locksmiths.

Some Europeans are economizing by planning errand trips more carefully and taking buses or subways
where convenient.

But Czech businessman Martin Kukas spoke for many in the region when he acknowledged his
automobile dependency.

"Even if the price goes up further, there's nothing I can do," he said at a busy intersection in downtown
Prague. "I just need to use the car."

(Thanks To The ASSOCIATED PRESS, And Fair Use For Educational/Research Purposes Only.)
ET
(07/02/2000; 19:10:04 MDT - Msg ID: 33110)
Lew Rockwell
http://www.lewrockwell.com/rockwell/lonestar.html
Lone Star of Liberty

by Llewellyn H. Rockwell, Jr.

Party platforms are usually better and more politically principled
than the candidates who run on them. Written as they are by
rank-and-file activists, they put the heart and soul of the party on
display, even when neither the officeholder nor the governing
coalition lives up to the promise. Rarely has a platform in our
times been as good as the Republican one from George W.?s own
home state of Texas; indeed it?s so good, it?s got all the right
people mighty upset.

What?s especially interesting about this document is that it
indicates what? s on the mind of GOP activists in the state from
which the GOP presidential nominee hails. But unlike the
candidate, these folks are not interested in putting a conservative spin on the
Clinton-Gore ideological muddle. They are demanding a complete break with the
politics of the last decade.

The smarmy "third way" politics of our time is supplanted by full-throated,
Texas-style independence and radicalism that rejects statism and collectivism across
the board. Sure enough, Bob Herbert, writing in the New York Times, considers it to
be evidence of the "zany extremism of the Republican Party in Mr. Bush?s home
state." Well, most Texans would consider some of the goings on in New York a little
zany too.

As for Herbert, he would say the same (and probably has!) about Jefferson, Paine,
Henry, Adams, and the whole of the Southern political tradition in America. He
probably doesn?t care much for the Texas penchant for resenting attempts at outside
control. The platform only appears non-mainstream by today?s standards; by the
standards of American history and current anti-government opinion in major parts
of the country and the world, this document is right on the money.

The preamble begins with a sweeping defense of freedom and counterposes it with
government?s continuing attack on liberty. This is the single greatest insight one can
have about the current political situation. Freedom doesn?t mean having the
Herbertian right to other people?s money and property; it means the right to be left
alone to manage your affairs the way you see fit. Yet this one point eludes 9 out of 10
commentators on politics who either don?t understand it, or favor the wrong side in
the battle.

Lefties are quick to jump on Republicans who praise freedom and then demand that
government step in to shape society in ways to their liking. But the Lone Star GOP is
more sophisticated: "No government on earth can replace the nurturing love found
in families, churches, and communities. The more that government intervenes in
personal relationships, the more those relationships will be diminished, not
strengthened. This is why the more government spends ?trying to solve? poverty,
education, and the decline of the family, the more the problems grow."

The preamble admits that some people find freedom to be a burden. To them it
warns that government is never a solution. "They will sacrifice their future on the
altar of the government?s false promises-guaranteed education, guaranteed jobs,
guaranteed security. No government in history has kept those guarantees. Where has
communism or socialism worked?" This is the rhetoric of truth-telling, and not the
kind of thing you see in the mainstream press, or even the conservative press.

The platform proceeds with a distinction that eludes even many libertarians:

the importance of localized political decision-making as compared with
centralization. "Not only does the Republican Party of Texas proclaim the freedom
of the individual citizen from the general power of government, it also proclaims the
state?s proper freedom from federal control." At last, some clarity about states?
rights, which, in the American political context, always refers to the right to be free.

Even better are the named implications of this right: no census powers for the feds
other than those in the Constitution (counting heads); the elimination of executive
orders; an end to the "gathering, accumulation, and dissemination of finger prints,
Social Security numbers, financial and personal information" by government; no
more federal emergency powers; no more federal land use controls; no more taking
of private property by the feds.

Imagine the degree to which this agenda would gut the central government as we
know it. It would matter less who held the office of the presidency. Even if we
someday ended up with another Clinton, he would be denied the power to wreck the
country with the stroke of the pen - a power which Clinton has, and Congress has
failed to take away from him. Isn?t rule by good law rather than rule by men
(whether good or bad) what we should be seeking?

As we might expect from Texas, where guns are commonplace, the platform is
squarely against all gun control: "The Party calls upon the US Congress to repeal any
and all laws that infringe on the right of citizens to keep and bear arms; to reject the
establishment of any mechanism or process to record, register, or monitor the
ownership of firearms; to reject the imposition of excessive taxation or regulation on
the manufacture or sale of firearms and ammunition."

As for social issues, remember how the left is always trying to paint the right as
secretly theocratic? In truth, the threat runs the other way: the government has
come to believe that it is a god, and it has been trying to crush the freedom of religion
by erecting a secular theocracy. The platform seems to understand this, asserting
that "all Americans have the right to practice their religious faith free of
persecution, intimidation, and violence."

On environmentalism, the platform is rock solid. "We reaffirm the belief in the
fundamental constitutional concept of an individual?s right to own and use property
without governmental interference." Consistently applied, this provision would gut
the invasive and expensive eco-regulations which have locked up land and crushed
new technologies that would enhance our standard of living.

The Texas GOP comes out against the Department of Education, all interference in
the right to educate at home, the phony-baloney classification of traditional
discipline as child abuse, the federal imposition of sensitivity training in colleges and
universities, all affirmative action and quotas, the minimum wage, all privileges for
labor unions, and even government-owned infrastructure.

The platform is further against the Kyoto Treaty, "sustainable development," the
Endangered Species Act as a land-use control regulation, the Biodiversity Treaty, all
inheritance taxes, and the Clinton administration?s "move toward the socialistic
redistribution of our national wealth."

Left-liberal commentators have been whipping themselves up into a frenzy about
isolationism on the right, by which they mean opposition to American imperialism.
Well, the Texas GOP is exhibit A in how dramatic the turnaround from Cold War
internationalism to the new right-wing "mind-your-own-business" foreign policy
truly is. Hence, the platform demands a pullout from the United Nations, an end to
funding the IMF, the repeal of Nafta, and withdrawal from the World Trade
Organization. These are interesting positions. They suggest that the Lone Star GOP
should reevaluate its own leadership, which supported all these programs.

Bob Herbert was particularly upset that the platform calls for the abolition of the
Federal Reserve System and the restoration of the gold standard. Zany extremism?
Not at all. Paper money is big government?s credit card. The gold standard has the
advantage of ending inflation, ending business cycles, and restraining the growth of
the public debt and debt-financed government in general. It would also make sure
that an unelected banker like Alan Greenspan would no longer have the main power
over the economy; as even he once wrote, the gold standard and freedom go together.

A platform that says something like this isn?t extremist or wacky, as Herbert claims,
though it surely shocks the sensibilities of New York Times editorial writers. Its
sentiments represent a radical departure from the present command-and-control
system of Clintonized government. That is an agenda widely desired within the GOP,
and also among independents who don?t trust the GOP to carry out the program.

Devolution from central government and a restoration of liberty and property is
exactly what is called for in a post-socialist age. The desire for such radical change
isn?t limited to a fringe; it is the dominant opinion in one of the largest state party
organizations in the country. Why must the nation ?s press continue to report on
rank-and-file GOP opinions as if they are reporting on life on Mars?

In fact, if the platform has a problem, it is not its extremism but its periodic and
wholly unnecessary nod to conventional opinion. It permits funding for Nasa
(located in Texas), some protectionism (when domestic industries are outcompeted),
and the Americans With Disabilities Act (no coincidence, passed by the Bush
administration), and whips up hysteria against China.

Also, the platform endorses the Pledge of Allegiance in public schools, as if any child
should be made to swear allegiance to the central state in these times. This platform
certainly doesn?t, and that?s what?s good about it. Its significance is that it serves to
remind us that the opinions and taboos erected by our political leaders and the
mainstream press have little to do with the opinions of millions and millions of real
people, who, after all, have a history and a future, and are voters too.

June 30, 2000

Llewellyn H. Rockwell, Jr., is president of the Ludwig von Mises Institute in Auburn, Alabama. He also edits
a daily news site, LewRockwell.com.
Canuck
(07/02/2000; 19:45:58 MDT - Msg ID: 33111)
From Gata (see msg 33102); who is the young "dynamo"?
Our "dynamo" host believes that certain currencies
are being manipulated to facilitate gold producer
hedging and that certain officials are encouraging
the manipulation of the gold market so the dollar
does not have competition from other reserve
currencies. That may not sound all that dramatic to
you, but this will be: Our host already owns tonnes
of gold (that is tonnes, not ounces) and is thinking
of taking delivery on $100 million to $120 million
of gold in the near future.
----------------------------------------------------
Light the match, dude, light the match.

Monsieur FOA may have clues on his return, yes?
SHIFTY
(07/02/2000; 22:55:33 MDT - Msg ID: 33112)
test
:)
ORO
(07/03/2000; 00:41:16 MDT - Msg ID: 33113)
Aristotle - comments, installment 2
The "lie" has four components, the "barbarous relic", central bank, the stability of paper money, and obfuscation of the disparate nature of savings and investment. The dismissal of gold and free banking as a monetary system is often used as to avoid having to discuss its workings, which are self correcting. The damage that a central bank does to money and interest rate setting in the markets (whether paper or gold+paper gold) is so thoroughly ignored in today's bull market for the Fed, that seldom does one hear any discussion of a world without central banks. Paper debt money is capable of smoothing out ripples inherent in banking, but only at the expense of creating enormous imbalances that later induce collapse. The cycle is roughly 20-25 years of credit expansion followed by a 10 year adjustment through stagflation. Often, the cycle is as short as 5-6 years on the upswing. With much external support, the dollar has managed to survive another 20 years after the stabilization by Volcker - it does not mean that the apparent stability is here to stay, it only means that the current system is ripe for collapse.

Savings are not investment. When savings, a non-entrepreneurial allocation of resources, are deposited at a bank that is part of the central bank system, they automatically go into the entrepreneurial arena, and immediately start the process of wasting resources. In a paper money system savings can not be had at all, unless done in the form of goods purchased for later consumption and stored within reach. Banks, being entrepreneurial, invest the deposits (in gold banking with a central bank) entrepreneurially while diluting gold values with derivative substitutes. The existence of a central bank imposes the valuation of gold derived from inflation of paper gold as the competition among banks for solid credit is eliminated by the central bank's reward of emergency loans to the irresponsible bank that found itself over-leveraged � thus preventing the elimination of the irresponsible bank's fiduciary media. Since these are not eliminated, the volume of "good" fiduciary gold does not fall and the dilution becomes permanent. The savings that people hold at banks are not treated by them as investments, but that is what they are. They contain risks of default on top of the risk (rather than calling it risk we should call it certainty) of depreciation of fiduciary media.

Bonds and savings are contradictory terms. So are modern "savings accounts" one does not save promises, one saves assets; land, gold, housing, collectibles, equipment. The bulk of bank accounts are viewed by the depositors as savings, while treated by the banks as investments. The main tool of savings in the past, were gold and silver. The displacement of these with paper promises causes dilution during the long periods of monetary expansion, and causes a return to fair value only during the short periods of deflation of the paper gold.

In a world of debt currencies, where gold is not allowed legal tender status, currencies are only capable of providing the function of savings when they are paying sufficient interest so as to prevent people from saving in goods on-hand. The interest rate on savings media must only be sufficient to cover the saver's expectations of price inflation rate less that for storage costs (space, spoilage and effort), to induce the continued use of currency for the purpose of savings. When interest rates do not reach these levels, the saver will choose to replace currency accounts with basements stuffed with goods. This switch, once started, can not be easily reversed.

Investment is not savings. Investment is the putting of resources at risk for the prospect of future reward. By eliminating gold and silver as apparently effective means for savings (by the dillutive effects of paper versions of them), all people are forced to invest by putting their funds in a bank account and having banks invest the funds in a portfolio of loans. Alternatively, savers can put funds in government and other bonds. None of these solutions are true replacements of savings, since all are investments.

The various elements of the lie � the "fraud of paper money" � are there for you to contemplate. The smooth running of a Ponzi scheme during its expansion is not evidence of it being anything but the fraud that it is, it is only evidence of the fact that the fraud has not been exposed. One would expect that the fraud that is structurally inherent in the current monetary system (gold and its paper markets included) to survive longer when the dozen governments with the greatest resources act to keep it going. The fact of apparent "smooth running" is not at all a sign of the system being workable over the whole of a generation. So far, no monetary system other than straight precious metal accompanied by free banking (or without any banking at all) has ever survived more than 25 years without going through a deflationary or inflationary crisis. The period just before the system crumbles is usually one of high speed prosperity and of high rates of debt accumulation. The fact of apparent prosperity is not an indication of future conditions. Your exasperation, shared by may gold bugs, is to be expected, but is still misplaced.

I have said before that any debt money system can have its life extended at the cost of having a greater collapse when such a collapse is not avoidable. The cumulative damage done by debt money to the economy is not revealed spontaneously until the collapse. The central bank may attempt to slow the rate of damage and extend the "reckoning" to a later date, however, it has not the option of avoiding the damage, nor of preventing the "reckoning" at the end of the process. Failure of debt money systems is structurally assured, what remains uncertain are the timing, the rate of change, and the ultimate degree of damage.
View Yesterday's Discussion.

Netking
(07/03/2000; 01:18:08 MDT - Msg ID: 33114)
Gold boiled in oil...
http://www.gold-eagle.com/gold_digest_00/hamilton070300.htmlGold boiled in oil...an interesting paradox....in Biblical days they boiled some of the Saints alive in oil until dead.....now it appears gold(looking 'dead') may boil in oil until alive.
Turnaround
(07/03/2000; 02:11:57 MDT - Msg ID: 33115)
I don't trust you that much
http://www.santafe.edu/sfi/publications/Working-Papers/00-03-021.pdfThis essay is purposely written without mathematical symbols and without references, 1
except for one. That is my two volumes on the Theory of Money and Financial Institutions
March 24, 2000

THE THEORY OF MONEY 1

Martin Shubik

Abstract: The basic role of fiat money in a dynamic economy is considered. Its role as a virtual
asset whose store of value properties are the outcome of the dynamics is explored and the role the
limits on the money supply and the bankruptcy laws in bounding prices are considered. The
actions of the government may serve to bound individual expectations.

THE CENTRAL ASPECTS OF MONETARY DYNAMICS

There are three basic aspects to the understanding of the central role of fiat money in a
modern economy. They are (1) the understanding of the violation of symmetry in the initial
injection of outside or government money into the economy; (2) the understanding of the
laws conservation of money and how and when they may be violated and (3) the understanding
of the dynamics of the mix of trust, custom, law, communication and information in maintaining
the worth of "worthless" paper or a mere abstraction of value in a dynamic economy.
Abstract money is a substitute for trust in trade. The rules of the game provided by the
laws and customs of the society using a symbolic fiat money can, under the appropriate
circumstances support a system dynamics where individual expectations that other individuals
will accept this intrinsically worthless paper or cypher will be self-fulfilling. The dynamics may
provide for the reinforcement of these beliefs which will provide for monetary stability.
2
The beliefs have two components and work on two sets of information. They are the
beliefs of the individual agent in the acceptability of the money to other agents and the beliefs of
the individual agents about the trustworthiness of the "referee" or the central bank or other agent
for the government which controls the money supply.
The central government is a critical differentiated agent in the running of a modern
economy even if its only role is to guarantee the soundness of the currency and maintain the rules
of the game (such as the commercial code) required to facilitate individual trade. An important
feature of the central government is that it is implicitly or explicitly in direct communication with
every economic agent in the economy. In contrast, in the generation of private credit between
two individual agents much special information must be generated. "Due diligence" is
performed to determine credit worthiness. Reputation helps to decide on prime names and lesser
names. Bank money is a form of credit where information and communication are more
routinized than in the arranging of individual credit. It is provided by a set of agents differing
both from individuals and the government. The banks and other financial institutions are larger
than mere individuals and smaller than the central government. They are far more visible in an
information and communication network than are individuals, but they are less visible than
government.
The acceptance of government money depends on the beliefs of a predominant part of the
society that the government is not going to run the printing presses. In a stable and reasonably
honest society it is cheaper and easier to trust the government that random strangers. In return
for this trust the government is able to provide a symbolic commodity which is accepted as a
means of exchange with the system dynamics converting it into a store of value. It becomes an
ideal transferrable paper gold or a substitute for the need for individual trust. If the central
government does not "cheat" this (possibly invisible) money behaves as though it were an ideal
gold.
bp1
(07/03/2000; 03:43:00 MDT - Msg ID: 33116)
Some musings on Independence weekend
http://www.usagold.comTitle: gold--wealth--the transfer of wealth--the rise and decline of empires:

Sometimes we are so caught up with our daily worldly schemes,we become confused, perplexed when we can not discern certain phenomenas. The current world of gold is a perfect example. you know, I know, the CBs know, the people in the know know that gold IS true representation of wealth--not just another industrial commodity; and the current price of gold in terms of U.S. (fiat)dollar is cheap, dirty cheap. The major printing houses, that is, the important CBs in the world are selling their gold hoard( Australia, Canada, Belgium, Dutch,England, and maybe U.S.A.) Are these central bankers gone mad, insane or without any common knowledge of the past, the current and the future?

A little history, plus a little philosophy will help us escape the traping trees, thus see the whole forest.

About 200 years ago, Great Britain defeated China in a war dubbed as " opium war". As war compensation, China gave millions ounces of gold and silver to Britain, plus the territory of Hongkong ( actually it was a lease ), and Great Britain continued to export opium to China for silk, china, tea, and of course for gold, silver. After this opium war, the once mighty, proud Chinese empire declined, eventually collapsed. The rising of British empire truly established, and reached its peak in due course.

Now about two hundred years later, in 1997, Britain returned its crown jewel ( Hong Kong ) back to China. In 1998, Britain announced the shocking news of selling its gold hoard.

About two weeks ago, the People's Bank of China announced the purchasing of gold through a South African investment firm.

We know all the sales of gold from European countries have to go somewhere. Which country, nation and people has the monetary and spiritual strength defying the current fiat money regime to accumlate gold? The answer is obvious by now: the greater China ( mainland, Taiwan, HongKong ). The only difference between China now and Britain then is one used gun and warship, the other is using trade surplus.

Can we see the history evloving? Gold, the true wealth, is moving to its current destination. The flow and transfer of wealth, the decling of one empire and the rising of another.

" CBs are ready to release increasing amount of gold'should its price rises "; the selling of years accumlated gold by using the DUTCH auction method;the leasings; the hedges; the derivatives. They are all pieces of puzzles in the almighy GOD's hands. What goes around, comes around---Ying and Yang.

The sad thing is: People who are losing gold know they are losing the real wealth, the war, but still can not stop it! Actually they have to facilitate it. Thus they are called the cabal. That's called history!

For the true goldbug, your day will come, maybe sooner than you think, just have to wait for this part of history finished.
Netking
(07/03/2000; 03:57:50 MDT - Msg ID: 33117)
Jason Happy
Jason Happy (33093)
A good narative for silver. However why not buy silver in bars eg 1kg etc, why the coinage as a preferred method of holding silver?


Leland
(07/03/2000; 04:39:30 MDT - Msg ID: 33118)
Sacagawea "Golden" Dollar -- An Update
http://foxmarketwire.com:80/062800/dollar.sml"The scarcity of the new coins is not caused by impracticality. MEI coordinated
with the U.S. Mint to ensure the new golden dollar would work in vending
machines already rigged to take the Susan B. Anthony. Both coins have the same
weight, the same size and even the same electromagnetic signature." (More)

wolavka
(07/03/2000; 05:34:52 MDT - Msg ID: 33119)
bp 1s' post is correct
Those I know have been moving into all forms of gold in taiwan. Watch asia.
Leland
(07/03/2000; 05:35:39 MDT - Msg ID: 33120)
USS John F. Kennedy, Part of Operation Sail 2000
http://www.inr2000.navy.mil/JFKpage.html.
Leland
(07/03/2000; 07:03:21 MDT - Msg ID: 33121)
Sharks are Cicrling, Beware...Got Gold?
July 2, 2000, 3:46PM

Big guys will be muscling into financial planning game

By SCOTT BURNS

His name IS Frank Terrelli. He is standing before a screen ablaze with a PowerPoint slide, his fingers
spread and pressed against each other, carefully addressing an assembly of some of America's
smartest and most successful financial planners -- a veritable brain trust of financial planning.

The occasion? The second Wealth Management Symposium sponsored by Undiscovered
Managers, a Dallas mutual fund and research boutique.

The fund's prime mover, Mark Hurley, rocked the boat last year when he published a paper
asserting that individual planners would soon be competing with, and perhaps overrun by, large
financial services firms. A transformation would sweep the industry as large companies tried, quite
literally, to capitalize on vast new wealth, Hurley said.

By Hurley's estimate, a client with $1 million worth of investment assets would provide a financial
services company with $7,500 in gross revenue per year and a startling $5,000 in profit. That profit,
in turn, would be worth $60,000 in new market capitalization for a publicly traded company --
enough to create a financial services gold rush.

As Hurley sees it, the opportunity for market capitalization will pit large companies against the small,
highly personal and idiosyncratic individual practices that have characterized financial planning in the
past.

Terrelli, dressed in a black three-button suit that barely allows sight of the silver-gray silk tie, may be
part of that transformation. With his black hair pulled back into a short ponytail, Terrelli looks like he
and actor Steven Seagal share the same tailor and barber.

The former accountant is telling the financial planners how myCFO.com will serve the very, very
rich.

How much money should you have to be considered very rich?

Lots. As you may suspect from the parking jams of personal jets at airports, the new market for
completely furnished, turnkey mansions and the clutter in yacht basins across America, the idea of
"rich" is a rapidly moving target these days.

Trillions in "new money" has shoved aside the quaint conceptions of wealth embodied by "old
money." Remember, "semi-affluent" is now defined as a net worth of $1 million to $10 million. (For a
column on the new categories of wealth, visit www.scottburns.com-

/991017SU.htm. To see where you rank for wealth, by age and percentile, visit
www.scottburns.com/000604SU.htm.)

"Technology will commoditize all those functions that people do that don't bring value added,"
Terrelli said. "I firmly believe that the Web and the Internet will change the way we live and work."

His words echo what presenters from Fidelity, AXA and American Express have said earlier about
reaching clients with less money.

Most of the skills that individual financial planners use will be trivialized by technology in the next two
or three years. Online advisers such as Financial Engines and others are automating the Web to
design portfolios for individuals with far less than $1 million.

Terrelli described how the myCFO Web site will provide complete, segmented management of your
finances so that the captain of your yacht (held in a corporation) will see all bills related to the yacht
on his portion of your Web service and approve them for payment. He won't, however, have access
to any other part of your financial picture.

Similarly, the executive director of your personal foundation will do the same with bills for the
foundation. Ditto your houses, investments, trusts, etc.

No one ever said being rich was simple.

MyCFO, Terrelli said, will replace the traditional "family office."

One of the planners asks who myCFO has in mind as customers? How wealthy should they be?
And what will his firm charge?

Terrelli says that a net worth of $20 million is the minimum, with $50 million "ideal." A client with a
net worth of about $100 million would pay an annual fee of about $400,000 for the service, he said.

The room suddenly bristles with raised eyebrows.

Does this mean anything for you and me?

Yes. Buy a larger mailbox now and avoid the rush later. While few will be solicited by myCFO, all
of us can expect as many offers for wealth and asset management from financial services firms as
we've had credit card offers from credit card companies.

(Thanks To Scott Burns, And Fair Use For Educational/Research Purposes Only.)
Journeyman
(07/03/2000; 10:29:59 MDT - Msg ID: 33122)
Re: Theory of Money 1 @Turnaround msg#: 33115

Sir Turnaround,

VERY intriguing paragraphs!!

A couple of impertinent and largely irrelevant questions:

1. Why did you use as your subject, "I don't trust you that much"?

2. Are you Martin Shubik?

Regards, j.
Journeyman
(07/03/2000; 10:34:28 MDT - Msg ID: 33123)
Did markets and the people choose paper money over gold?

Question 3: Did markets and the people choose paper money over
gold? If not, who did?

It was the market which in a selective process, going
on for ages, finally assigned to the precious metals
gold and silver the character of money. For two hundred
years the governments have interfered with the market's
choice of the money medium. Even the most bigoted
etatists [statists -j.] do not venture to assert that
this interference has proved beneficial.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 422 [XVII. INDIRECT EXCHANGE 6. Cash-Induced and
Goods-Induced Changes in Purchasing Power -available also from
http://www.mises.org/humanaction.asp]

Regards,
Journeyman

In case you tuned in late, this post is Mises "answer" to
question 3. of the following six posed in an earlier post:

1. Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?
Al Fulchino
(07/03/2000; 13:14:43 MDT - Msg ID: 33124)
NetKing/Aristotle
Does anyone suppose Adam Hamilton is our Aristotle?
Leigh
(07/03/2000; 13:52:30 MDT - Msg ID: 33125)
Al Fulchino
Dear Al: Just last month I was asking Peter (via e-mail) if he thought Aristotle was William Simon, the former Energy Czar and Treasury Secretary who died in early June. It had been many weeks since we'd heard from Aristotle, and when I saw poor Mr. Simon's list of accomplishments I couldn't help but think that he must have run around in the same circles as Aristotle. It was such a relief to have Ari post again, which proved he was indeed alive!

Peter would never have told you that story (he's a gentleman), but since you brought up the subject, I just thought I'd tell you about my wild guess!
Turnaround
(07/03/2000; 15:13:19 MDT - Msg ID: 33126)
Lacons
Journeyman (07/03/00; 10:29:59MT - usagold.com msg#: 33122)
Re: Theory of Money 1 @Turnaround msg#: 33115

"Sir Turnaround,

VERY intriguing paragraphs!!

A couple of impertinent and largely irrelevant questions:

1. Why did you use as your subject, "I don't trust you that much"?

2. Are you Martin Shubik?"

Dear Sir Journeyman,

1) The subject header was intend to provide a one-line rebuttal for a
two-volume work (MIT Press, I think?) How's that for economical? (smile)
I trust people in general, some more than others, but am quite unwilling to
allow just whomever to carry my wallet for me.

I posted this thinking perhaps Aristotle and others would find it of interest.
I don't have the order price of his book in 2002 dollars, perhaps under a $billion.

For myself? I view this work as yet another example of the debasement of intellect
that attends a debasement of what MS calls "money"- part of the "debauchery" our
predecessors spoke of.
Santa Fe Institute has a lot of wonderful people and has enabled fantastic contributions
in a variety of sciences, it saddens me to see them stoop so low for grants. From what
I read of the synoptic paper, MS needs some further grounding before attempting
this project. I wish we could ship ORO et al down there, but I don't think NSF grants
contain a gold clause.

2. See 1. ;-)

SHIFTY
(07/03/2000; 16:10:31 MDT - Msg ID: 33127)
Off to the movies!
Going to see The Patriot. Will let all know how it was later tonight. :)

$hifty
ET
(07/03/2000; 16:37:44 MDT - Msg ID: 33128)
PrudentBear.com
http://216.46.231.211/credit.htm
Several quotes:

"Now that May data is available, we see that Fannie
Mae and Freddie Mac sharply increased credit
creation. For the month of May, these two powerful
credit creators had gross mortgage purchases of $32
billion, this compared to $17.5 billion during April.
In fact, May was the most aggressive month of mortgage
purchases since September. Perhaps it is coincidence
that these two periods of aggressive purchases
coincided with bouts of considerable financial
stress. Remembering back to September, spreads were
widening substantially, liquidity was disappearing in
the credit market, and the gold derivatives market
dislocated spectacularly."

"The fact that the GSE's returned to rampant credit
creation (joining the banking system!) the same month
that the Fed moved "aggressively" to increase
interest-rates 50 basis points, reinforces our
contention that Federal Reserve monetary policy has
become largely irrelevant."

"Apparently unappreciated by the Fed, it is the nature
of credit availability, and not the price of credit,
that has become the key issue for the great U.S.
financial and economic bubble."
beesting
(07/03/2000; 18:01:35 MDT - Msg ID: 33129)
Value of an Old Coin!

Received my Sept. 2000 copy of Coin Prices Magazine today, and besides the usual listing of modern U.S. Coins and values, was a listing of coins used in the days before the United States declared its Independence from England.
Here is one that cought my eye:
HIGLEY OR GRANBY COPPERS:
DATE......GOOD......VG......FINE:
1737.....$8500.....$10,000..$12,500:
DESCRIPTION:
Looks to be about the size of a modern day U.S. quarter or a little bigger, one side has what looks like three torches en-circled by;" I AM GOOD COPPER".
The other side of the coin has what looks like a deer en-circled by;"VALUE ME AS YOU PLEASE".
(my comment:I love it!!!)

Now, Granby Connecticut is located about the middle of the state just below the Massachusetts state line and about(guessing)60 to 80 miles from Boston Bay, where the famous "TEA PARTY" was held.On the map it looks like a still rural area. If I could only talk my wife into going there for a few days with a metal detector and sneaking into some of those old historical spots.....hhhmmmmmmm.....onward!

If the maker of these coins marked,"VALUE ME AS YOU PLEASE" knew that by the year 2000 the value of "ONE"would equal:
About 40 ounces of Gold or,about 40 good horses,or about 250 calves, or about 100 chords of firewood, but would only buy a very small piece of land,might not be enough for a wedding,funeral, lawyers fee, or doctors fee,don't you think he/she may be surprised?
Food For Thought....beesting.
beesting
(07/03/2000; 18:18:02 MDT - Msg ID: 33130)
To Sir ORO msg#33113...."The Lie".
Sirs Aristotle and ORO,,,Real,Real,Real Great discussion!
ORO,with your permission I would like to make a few copies to give to friends.
Thanks in Advance....beesting.
SHIFTY
(07/03/2000; 18:28:50 MDT - Msg ID: 33131)
Back from the movies
I was late and did not want to miss the first few min.
Will have to go tomorrow!
Better to see it on the 4th!

$hifty
ORO
(07/03/2000; 18:47:08 MDT - Msg ID: 33132)
beesting - copies of discussion with Aristotle
Feel free to use my portion of this discussion, I hope Aristotle will allow you to do so as well.

Jason Happy
(07/03/2000; 19:47:05 MDT - Msg ID: 33133)
Netking: Silver Coins vs. Bars (Today)

These days, you can get more silver for your dollar in coin form than if you prefer .999 fine bar form. Many coins came out of long term private storage in the pre y2k scare, when the coins became scarce, and prices jumped up to $7-10 oz. while silver rose to a mere $6.50 or so? However, the new purchasers were largely y2k hoarders, who have since dumped their silver back onto the market becasue y2k fears never happened. Supply and demand...

At about $5.00/oz, a 100 oz. .999 fine bar might cost $530, which is a $30 primium over spot, or $5.30/oz for the silver content.

At about $5/oz., I was able to buy $253.25 face value silver (times .72) or 182.34 oz. for $940.00, which comes to $5.15/oz for the silver content.

The coins then:

Cost less, no more is being made, comes in small & easily recognizable pieces with a large canvas bag... and you get more silver for your money... and has the potential to raise in value faster than actual silver due to collector value... seems a no brainer.

Call our host, and order today:
(prices vary daily, shipping may cost extra)
(primium percentages may drop with larger size orders)
(this is not a paid advertisement)
(I just know that this is how it all works...)
(800) 869-5115 toll free phone
schippi
(07/03/2000; 21:46:29 MDT - Msg ID: 33134)
Select Gold Chart 120 Days
http://www.SelectSectors.com/fsagx.gifFSAGX trend remains Up

Happy 4'th Of July to ALL
Al Fulchino
(07/04/2000; 00:15:26 MDT - Msg ID: 33135)
A Call to All Who Would be Patriots
Having just had the privilege of seeing the movie PATRIOT and this being the wonderful 4th of July, only 224 years after that wonderful day in 1776, I thought it time for a post.

I owe a debt of gratitude to all those that have given of themselves. They have given me the sun each day to rise and watch over choices I make. They have given me the time to watch without worry over the growth of my children. They have given me the the gift of freedom. That gift, I can NEVER repay. But in my own words, I say to all who have ears. Do not challenge my freedom. Do not take or attempt to take away my ability to defend my freedom. Do not try to 'make safe' my country by enacting law after law that hinders my ability to hold a gun in my hands and to do what common sense tells me. I am well at ease that criminals have guns. I am at ease that crazies have guns. They do not scare me or my family. Nor should they frighten you. What should be of concern are those that would gather up people's emotions against what is and has always been the peoples 'tool'. Once you are without weapon you are defenseless. Being defenseLESS you are no longer free. Safe? Yes! Safe without free will. Subject to those who know our needs better than we. You anti-gun folks, you are not my countrymen. You are not my friends. You are at war with me and always shall be. You are clever. You understand how to manipulate people and to scare them. For your purpose is your own. I understand that. Your efforts are my generations challenge to "keep freedom if (we) can". I raise my voice up against you and your efforts. I raise my glare up against you. And I draw my last breath up against you to expose your deceit.


Viva la American Revoltionary!View Yesterday's Discussion.

Al Fulchino
(07/04/2000; 00:16:58 MDT - Msg ID: 33136)
Leigh
Saw your post on Aristotle. Thanks. It is interesting to sometimes wonder just "who" everyone is.
Topaz
(07/04/2000; 00:48:42 MDT - Msg ID: 33137)
Whacky, fringe-dweller, Lunatic, Bugs-R-Us.
See-Text@BelowTks HMS@kitco:

Heavy Metal Sunshine () ID#258273:
Copyright � 2000 Heavy Metal Sunshine/Kitco Inc. All rights reserved
Chris Coralans who several years ago predicted that July 1998 and April 2000 would powerful months in the markets ( which they definitely were ) based on his study of moon cycles ( Not Astrology ) Points to the new moon of July 16 as being a potent period for currencies gold etc. Von braun discusses this in the link below. Von braun is a bit inaccurate in that Carolans says that the period ten days before or ten days after is when we should see action if I heard it right. The 2nd link is a Wall Street Uncut interview with Chris Carolans where he describes his techniques, his logic and what he sees for July 2000. Defintiely worth the listen and the read.


http://www.gold-eagle.com/gold_digest_00/vonbraun070400.html

http://www.wallstreetuncut.com/scripts/mp3link.asp?target=wsu20000602-final
Netking
(07/04/2000; 01:38:40 MDT - Msg ID: 33138)
@Jason Happy
Jason Happy (33133)
Thanks for your reply & useful infomation.

Due to dynamics of supply where I live 1kg bars have been the 'order of the day', but when Silver moves 'it's going to really rock'. I can't buy enough of the stuff at the moment. Silver may be just be the most undervalued commodity in the world today.




Netking
(07/04/2000; 01:44:31 MDT - Msg ID: 33139)
Al Fulchino Re;'A Call to All Who Would be Patriots'
Al Fulchino spare a thought for the British and 'what might have been'!
Perplexed
(07/04/2000; 01:55:21 MDT - Msg ID: 33140)
Thanks Aristotle
Thanks Aristotle for the kind thoughts, they are
indeed high praise. As previously stated I have great
admiration for those, such as hyourself, who are both willing and able to present a subject, which I, untill recently, have had little interest, in a manner which is readily comprehensible. While I, as well as many other citizens of this nation have been expecting a major financial collapse, and an accompanying sea change in government for a number of years, a connection to gold did not occur to me.

Now in my mid 60s, I have spent my life in physical labor, working as a carpenter, boat mechanic, airplane mechanic, police officer and soldier. Until recently I have had neither interest nor experience in the financial world. Having previously purchased some gold earles I began tracing their value. Thus recognizing its potential, last September
I purchased (2) August call options for a total of $900.00
including all fees and commissions.

In less than a month my broker called informing me that their combined value had reached $6500.00, inquiring as to whether I wanted her to sell them. With over ten months left on the options, and with an unshakable belief that gold was off and running, I declined. I sold them later for $3750.00.

With these kinds of losses, only a fool would continue selling options unless the game had been subsequently rigged, and only another fool would fail to recognize this fact.

I had previously told my wife that because of the potential loss compared to the potential gain, that who ever sold those calls was playing a fools game. I used part of my gain to purchase (2) October calls.

Now you know why I am still Perplexed
wolavka
(07/04/2000; 04:56:11 MDT - Msg ID: 33141)
Week-end of July 15th
Between now and July 17th gold will shine.

Da basement for the Dollar.
wolavka
(07/04/2000; 05:14:48 MDT - Msg ID: 33142)
counterfeit
Look it up, look at the Dollar. End of the story.
RossL
(07/04/2000; 08:22:15 MDT - Msg ID: 33143)
SDR- Currency chart update
http://home.columbus.rr.com/rossl/gold.htm
The chart is in a new URL location. It has been a long time since I worked on this chart, having moved to a different city and getting settled.

wolavka, what is the basis for all your predictions?
Leland
(07/04/2000; 08:53:04 MDT - Msg ID: 33144)
For History Buffs, Highly Recommended Reading (Lucky That my Local Library had this one)

Just Plain Folks: Everyday
people made difference in
American West

By Russell Gold
San Antonio Express-News Staff Writer

The American West was always a promised land just
over the horizon. There, a few miles beyond the last
settlement, were copious farmlands, bountiful game,
mountains rich in precious metals.

It's an image ingrained in the national mind for more
than two centuries. But the myth of the frontier has
never squared with the reality of the Western
experience.

That's the jumping-off point for Robert Hine and John
Mack Faragher and their vast new history of the
American West. Readable, abundantly illustrated and
never too theoretical, the book covers mostly familiar
terrain: Lewis and Clark's expedition, the
transcontinental railroad, the phenomenal growth of
Los Angeles and other urban areas.

But it is the authors' attention to the people who
shaped the historical experience � not the leaders,
but the everyday Americans � that sets this book
apart.

Take the book's handling of the 1849 gold rush and
the waves of mining fever that gripped the nation. This
version is peopled with gold rush widows and female
entrepreneurs who made more money cooking for
miners than their husbands found at the bottoms of
their gold pans.

The authors write about how empty-handed
American-born miners turned their frustrations on
immigrants in the camps. Ramon Navarro, a Chilean
miner, wrote in 1850 of an attack on his camp by a
mob that "demolished each house, not leaving a single
wall standing."

The situation was often worse for Chinese miners; and
for American Indians, mining strikes were often "an
unmitigated disaster," the authors note.

In fact, the rumor of a gold strike in the Black Hills led
to a clash between a federal government trying to
open the land to miners and the Sioux. The result was
the infamous Battle of Little Big- horn.

Worn down by the federal government's need to
control the land, Sioux leader Sitting Bull observed,
"Possession is a disease with them."

Historians Hine and Faragher use their preface to
praise the emergence of "new material with a steadier
emphasis on Native Americans, the role of ethnicity,
environmental issues and the participation of women in
the events of Western history."

They incorporate overlooked voices into this sweeping
history � female park rangers, Chinese railroad
workers and even Juan Cortina, known as the Tejano
Robin Hood, who operated in the Rio Grande Valley
before the Civil War.

To their credit, they also use these experiences to
rethink standard historical interpretations.

Consider the myth that independent, robust
homesteaders settled the West. Hine and Faragher
show how lumber companies, the railroads and cattle
companies used their influence in Washington � and
dummy homestead claims � to obtain much more
land than all the homesteaders combined.

Ten years after the Homestead Act of 1873, the
federal government boasted that the law had
"prevented large capitalists from absorbing great tracts
of public domains." The authors call this
pronouncement "a barefaced lie."

The book is so thorough in most areas that when a
subject is undeveloped, the absence is glaring.

The invention of windmills and barbed wire, which
separately helped shape the face of Western
agriculture, could have benefited from more attention.
But both are basically overlooked even as the authors
detail the emergence of Levi Strauss' durable
dungarees.

(Maybe this is a parochial quibble, since barbed wire
was first publicly promoted near San Antonio's City
Hall in 1876.)

Do these new perspectives fundamentally undermine
the myth of the American West? Hine and Faragher
have their work cut out for them here.

Our view of the West has always been rather black
and white � or perhaps Technicolor since Hollywood
began cranking out Westerns. But nothing is that
straightforward in the West; much that we associate
with the region is a result of the mixing of peoples that
the authors term "composite culture."

Log cabins were first built by Scandinavian pioneers,
and the techniques were spread by American Indians,
who borrowed the settlers' horses to create a great
nomadic hunting culture on the plains. Later it was the
pioneers' turn to borrow Hispanic cattle-raising
technique and spread it across the plains.

The authors conclude that in spite of new voices and
perspectives, the myth of the American West is too
deeply ingrained for mere facts to dislodge. But thanks
to their book, the myth has taken one on the chin.

(Fair Use Protections Apply.)
SHIFTY
(07/04/2000; 09:21:54 MDT - Msg ID: 33145)
Al Fulchino /all
Thought I would share with the forum a bit of what happened to me the other day.
My pressure tank on my well went out (small rust hole) and I had water shootin 20ft in the air.
So off to my local plumbing supply shop to pick up a new tank. While I was there an older woman came in and was complaining about her NEW toilet. It had just been installed a few days before. ( At this point anyone with a newer style toilet knows where I'm going.) She was telling the store owner that she had to plunge it every time and flush it two or three times. The owner told her that there was nothing wrong with her New toilet . The problem was with the US Government. With their infinite wisdom they passed a law that all new toilets can only use 1.5 gallons of water per flush, instead of three gallons.( I have a friend with these new toilets and I know what she was talking about. You end up using more water than normal because you have to flush several times.) He told the woman that there is little that he could do for her. He then told the story of a few guys that were busted for smuggling toilets in from Canada.
I just cant believe that this is allowed to go on in the USA , and our fellow citizens do nothing to change this. We have been converted from peasants with pitchforks to peasants with plungers. I guess if I ever move out of my old house I will be taking my old toilet with me!
I fear by the time the people in this country wake up and try to change things they will find out its too late.

$hifty
beesting
(07/04/2000; 10:32:32 MDT - Msg ID: 33146)
A Tribute to the Foot Soldiers of the American Revolution!
Oral History Only.
Who were the "Scrappers" that took on the English during the Revolutionary War?
This is some of the history of some of them!

As most reading this are familer with the movie by Mel Gibson "Braveheart" lets continue the saga between the English Royals and the Independant freedom loving Scottish.

Most Scottish refused to recognise Englands Royal claim to ownership of Scotland, as the Scots had a Royal family of their own.A pitched bloody fued from the time of William Wallace(1297) to "The Battle of Culloden"(1746) happened.

Before and after the "Battle of Culloden" the English, realizing the Scottish would always remain faithful to the law of the family(Clan), began to break the families apart by DEPORTING as many Scots and dissenters as possible to the English Colonies in the New World(North America)

The Scottish suffered a terrible defeat at the "Battle of Culloden", and the English monarchy boasted that they'd never be bothered by the Scots again, deporting thousands.

However in the new land the Scots found they had a family structure similar to the Native Americans,with Chiefs and Elders in control of the whole family including "Septs" to the high council and ultimitly the head Chief. This similarity worked in favor of the new colonists as they learned how to survive and learned new and different fighting tactics from what we now call The Native Americans.

This time(1776) when it was "War as Usual" with the English, the Scots who had developed 600 years of pent up anger against the English,"Hit em with Everything we Got" and were a main components in the victories.

So, as those of Scottish decent may have been tought, we did lose "The Battle of Culloden",,but we didn't lose the last war with England;
The American Revolutionary War!!!
Next time you see one of those guys wearing a Kilt think about what his ancestors went thru trying to give you.....FFFRRRREEEEEEDDOOMMMMMM!!!!!!!

Happy Fourth of July to all those that choose "FREEDOM" over slavery!!!
....beesting.
ORO
(07/04/2000; 10:53:18 MDT - Msg ID: 33147)
Journeyman, Turnaround - Martin Shubik paper
http://www.santafe.edu/sfi/publications/Working-Papers/00-03-021.pdfI have not given the whole paper a thorough reading, but I would like to criticize a couple of points already.

From the text:
It is usual to contrast fiat money with a commodity money in terms of the former having the store of value property purely through the bootstrap of the dynamics of expectations, whereas the latter has an intrinsic store of value in its use in consumption or production. This dichotomy is by no means clean. In fact, in spite of the ideal condition that a trade utilizing an ideal commodity money should be intrinsic value for value, historically gold has usually carried a transactions value premium; i.e. there are individuals around who have no consumption desire for gold but who value it for its services as a means of payment. This observation can be made mathematically rigorous 5

5The condition of enough money is characterized both by the total amount of money in the system and its distribution (taking the transactions technology as given). We specify the three conditions concerning the sufficiency and distribution of money.
Enough money, well distributed An economy will have enough money that is well distributed if at any equilibrium no individual experiences a cash flow constraint.
Enough money, badly distributed An economy will have enough money that is badly distributed if it is possible to redistribute the money such that at an equilibrium no cash flow constraint would be binding for any individual.
Not enough money An economy will not have enough money, if at an equilibrium there is no way to redistribute the money such that all individuals can avoid a cash flow constraint..
When there is not enough money in a society for a given technology the price of gold will go to a premium above its marginal consumption value. Mathematically a shadow price appears for the cash flow constraints which become binding when there is not enough money for transactions.

A reason for an individual to prefer gold as a currency over fiat money was already observed by Ricardo. It amounted to the proposition that trust in gold as a currency is easier than trust in the politicians and bankers who are meant to control the fiat money supply.


Comments:
In this treatment, Shubik ignores a number of issues and ignores the main point of having a commodity money:

1. The trust in political and banking powers has not once been demonstrated to be placed where it belongs. History has revealed repeatedly that neither banking nor government are trustworthy. Analysis of the "natural" character of these "agents" shows that neither is structurally capable of avoiding mismanagement of fiat money. THE EXISTENCE OF FIAT MONEY AND THE CONCEPT OF MONETARY MANAGEMENT ARE INHERENTLY CONTRADICTORY TO PROPER FUNCTION OF THE FINANCIAL MARKETS.
1a. The motivating factors for government and bank issue of money - higher profit for both "agents" than is possible without fiat money - precludes the possibility of sound management. Thus there is a motivational limitation on the proper operation of a fiat monetary system.
1b. The mechanical problem of managing a fiat money system leads to arbitrary settings of interest rates at levels other than those that are needed for "correct" responses of "agents" to the underlying economic conditions. Rather than discovering the appropriate conversion rates for capital and income through demand and supply in the markets, the management function of the monetary authority obfuscates the supply and demand conditions by setting an arbitrary interest rate.

2. Cash flow constraints are NECESSARY for proper function of the financial markets. The liquidity limitations of commodity money systems are not drawbacks but a constructive function.
2a. The cash flows must be restricted in order to avoid the hidden redistribution of control over economic resources to government and banking "agents" from the creators of these resources. Government control is then achieved only through obvious means of taxation, banking is exposed to settlement problems as a result of bad judgments in a system without a government provided lender of last resort. Thus bad banking practices are exposed due to liquidity limitations, and the weak banking practices are eliminated through the bankruptcy courts.
2b. Liquidity limitations are necessary in order to allow transfer of control of economic production from those who have mismanaged their enterprises and necessarily produced losses in a liquidity constrained system, to those who have not produced losses - meaning that they have run their enterprises well and have accumulated funds that can be used to buy the assets of the bankrupt businesses.
2c. The fiat money system is a means to distribute losses from particular "agents" to the whole group of economic "agents" through the mechanics of monetary expansion in a system with no natural cap for monetary expansion.

3. The concentration of decision-making in a limited number of hands instead of the distribution of decision making to all participants is a necessary feature of fiat money, because it must be "managed" by someone. The paucity of inputs into decisions on interest rates and monetary base expansion/contraction leads to a necessary misallocation of economic resources, since only a few of the creators and consumers of these resources can exercise their judgments in the area of interest rates and the definition and size of the monetary base.

4. There is an imaginary component to the value of any money that is based on expectations and the fact of title possession not guaranteeing control over the asset. Only a physical money can provide complete control by the holder of title through the fact of possession. The premium such control may fetch on the markets, is balanced by the discount that a less convenient means of holding money would be given by the markets. When fear of breach of fiduciary responsibilities by monetary "agents" of government and banking is high, the premium for possession would be greater than the discount for inconvenience. When political problems such as war or tyranny are a fear (or a fact) of the markets, the title of possession falls to discount and only physical control has a premium. The fiat money system does not allow the participating "agents" to avoid the dangers of all of these threats but through the action of spending all money, and perhaps borrowing to spend now so as to avoid the future loss of purchasing power of expected future income. Once such perception becomes widespread, it becomes self fulfilling as the escape from fiat money holdings is impossible � each quantity spent moves to someone else's hands, who must in turn spend it. The commodity money that undergoes such a process can recover easily as the supply of it is restricted, and debtors end up forced to sell production and assets at a lower price in order to avoid bankruptcy resulting from insufficient cash flow.

There is much more to criticize but I will leave that to another opportunity.



Galearis
(07/04/2000; 10:59:06 MDT - Msg ID: 33148)
@ Al Fulchino re: "The Patriot"
A predisposition to a liking of a movie is usually confirmed with a thrilling experience. However, a more objective appreciation for accuracy and history may foster a different result:
*********
I saw the Patriot with my wife yesterday. It's about an american hero, played by an Australian who was really a slave owning, philandering despot, who had a reputation of atrocity in a previous Indian/French campaign. In short, a typical Hollywood fabrication. For me, the knowledge of the reality spoiled the movie.

Rhody.
*********
But then again one shouldn't really be too hard on a movie if it is a little weak on morality and ethics, it's only entertainment. Remember the "Godfather"? Another fascinating movie that did not have a moral position.

Like Rhody, however, I think it would have been better if they had picked a lead who wasn't a citizen of the British Commonwealth. The tyranny of the dollar strikes again.....

Best regards,

G.

Usul
(07/04/2000; 11:02:18 MDT - Msg ID: 33149)
On Credit Availability, or "Easy Money" (following up on ET's No. 33128)
http://216.46.231.211/Comm%20Archive/markcomm/090899.htmPrudentBear.com's highlighting of the issue of credit availability is further illustrated by their citation of Charles P. Kindleberger on September 8, 1999. Kindleberger said:

"Before banks had evolved, and afterward, additional means of payment to fuel a speculative mania were available in the virtually infinitely expansible nature of personal credit. For a given banking system at a given time, monetary means of payment may be expanded not only within the existing system of banks, but also by the formation of new banks, the development of new credit instruments, and the expansion of personal credit outside of banks."
(see main link above)

Now let's take a look at the US housing-related government sponsored enterprises (GSEs): the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).

"Fannie Mae and Freddie Mac are two of America's biggest financial institutions- and also two of its most indebted, with around $1 trillion of debt between them"
The Economist, 15th April 2000
http://www.economist.com/editorial/freeforall/20000415/ld8928.html

Dr. Kurt Richebacher wrote:
"Home mortgage refinancings (refi) have zoomed to levels never seen before. Capitalizing on the decline in longer-term rates, homeowners refinance their mortgages at cheaper rates, frequently taking out larger loans, lowering thus their home equity. Periods of heavy refi activity have always been periods of strong consumer spending. Refi, stocks, home prices, tax refunds, auto bonuses, confidence, etc., are all up..... the financial system is firing on all cylinders to accommodate a consumer spending bubble."

- From "Bouble Trouble" [sic], June 1998, by James R Cook
http://www.investmentrarities.com/6-1998.html

More:
"It was the extraordinary purchases by Fannie Mae and Freddie Mac, the two Washington-based mortgage-buying behemoths, that righted the debt markets, he says. And it was this intervention that set the state for the five-figure Dow Jones Industrial Average. It is the vast expansion in financial credit that has sustained the asset inflation (that's 'bull market' to you CNBC viewers)." Freddie and Fannie, together with the Federal Home Loan Banks, expanded their balance sheets, Noland estimates, some $128 billion from October through December. 'If they hadn't bought all that paper,' he says, 'the hedge funds would have been stuck with it. It would have been a much, much different world."
- Doug Noland
http://www.gloomdoom.com/6-1999.html

More:
"I see Fannie&Freddie as the greatest instigators of credit excess in history. I even go one step further and believe they also create "money". "
- Doug Noland, from The Credit Bubble and its Aftermath:
A Time for Dialogue, one-day symposium hosted by David W. Tice & Associates, Inc., Tuesday, September 21, 1999

http://www.brill.com/economy/messages/3450.html

"Fannie Mae and Freddie Mac are the two largest government-sponsored enterprises (GSEs) and suppliers of funds to the one- to four-family housing market in America. A GSE is a privately owned, federally chartered corporation that operates nationally with specialized lending powers. The Congress creates GSEs to correct perceived failures in private credit markets. To assist GSEs in achieving their goals, Congress provides them with explicit subsidies. Fannie Mae and Freddie Mac, for example, do not pay state and local income tax on their earnings. More important are the implicit subsidies that GSEs receive. Although the federal government has disavowed any legal responsibility for their financial obligations, markets behave as if the federal government would almost surely make good on GSEs' obligations if the GSE could not. This saves the GSEs money by allowing them to borrow at an interest rate that is only slightly above the rate available to the U.S. Treasury"
- Fed bank of Minneapolis, Dec 1996

http://woodrow.mpls.frb.fed.us/pubs/region/96-12/FFrecap.html
Leigh
(07/04/2000; 11:02:19 MDT - Msg ID: 33150)
Censorship at Kitco Utopia
Five or six weeks ago, wasn't USAGOLD being loudly accused of censorship by those on other gold forums? Wasn't Kitco held up as a utopian website where all views were welcome and self-policing ruled? Well, well, how life has changed in the past two weeks at Kitco Utopia. Posters have disappeared stealthily in the night. There is a big warning sign at the top of the forum webpage to any potential disruptive elements. It is understood that the society of Kitco posters must get along.

Right, Skinny?
Gandalf the White
(07/04/2000; 11:34:16 MDT - Msg ID: 33151)
The date of July 17 pops up again !
http://www.smh.com.au/news/0007/05/business/business10.htmlBank of Japan gets radical: it could raise rates
By MICHAEL MILLETT in Tokyo
The issue could be decided on July 17, when the central bank board meets to frame interest rate policy.
====
Wishful thinking!
GO YELLOW Stuff!!
<;-)
ET
(07/04/2000; 13:02:42 MDT - Msg ID: 33152)
Usul

Hey Usul - thanks for the links! Yes, it appears we are headed for another government-sponsored bailout (read monetization), of the 'new' S&L's. You can probably grab your history book at this point and see exactly who won and who lost in the last extravaganza for clues as to the outcome this time.

I suspect new money will be created when needed through the end of the year. The GSE's are political institutions. However once the election is over, things could change. It seems the only thing keeping this afloat is debtor confidence. I see today we are treated to the news that oil prices will soon return to 'normal' thereby allowing consumers to resume their borrowing just in the nick of time.

From Jim Grant's site:

"Like a commuter who shuttles
between Scarsdale and Wall Street, the
credit markets travel from Stringency
to Accommodation (and back again).
No timetable is published for the
cyclical journey of lenders and
borrowers, but an alert traveler can
orient himself just by looking out the
window. For instance, the rise in
junk-bond defaults, the troubles in
syndicated lending, the widening of
credit spreads, the expressed anxiety of
the banking regulators and the
disclosure last week by Wachovia Corp.
of a $200 million addition to its
bad-loan reserve all point to the
obvious conclusion that the train of
credit is fast approaching the city limits
of Stringency."

All Aboard! Happy Fourth Usul!


tedw
(07/04/2000; 13:20:00 MDT - Msg ID: 33153)
The Patriot
http://www.usagold.com
Braveheart being one of my favorite movies with Mel Gibson,I couldnt wait to go see the Patriot.It was an interesting enjoyable movie and it does help people to appreciate the sacrifices made during the Revolution. I recommend spending some Gold and going to see it.

In all objectivity however, I have to say I found the movie a little flawed. Mostly in the obvious imitation of Braveheart.
One scene Mell Gibson stakes a charging horse in the chest just like they did in Braveheart. Also the story of rebellion being sparked by a sons death is very reminescent of the rebellion being sparked by his wife death in Braveheart. And the hand to hand battle scences are very reminiscent of Braveheart. I would have to say it is somewhat of an imitation movie, but well done nevertheless.

Personally, I would have enjoyed it a little more if some of the actual history of the Declaration and The Constitution would have been shown.

But, all in all, good fare and maybe it will help the average American to appreciate the sacrifices that were made for him.
Aristotle
(07/04/2000; 13:25:47 MDT - Msg ID: 33154)
A kernel of truth
I'm not a disciple of Heilbroner by any stretch of the imagination, but on occasion I've been impressed at his ability to turn a phrase. I believe this is close to one of his quips--

"Mathematics has given rigor to the study of economics, but alas, also mortis."

If I have incorrectly attributed it, no matter. The point I'm making is that economic thought is accessible to everyone, and the great tragedy is that more people don't dabble in economic thought because they are unnecessarily intimidated or else distracted by the thin outer shell of seemingly rigorous mathematics. The more you see economics for what it really is, the more you see the importance of Gold's role in the grand scheme of life on Earth.

And in recognition of this special day,
Economic Freedom. Get you some. ---Aristotle
Holtzman
(07/04/2000; 14:10:38 MDT - Msg ID: 33155)
Let Freedom Ring Indeed
http://www.sunday-times.co.uk/news/pages/Saturday-Times/timwekfas02001.htmlHoltzman here,
--------------
We are more alike than different
--------------

I hope all of you in the U.S. are having a wonderful celebration. Over here, we tend to set off our fireworks on Guy Fawkes day, but for somewhat related reasons: Fawkes' original plan in 1605 was to set off his explosives in the cellars beneath the House of Lords whilst King James I was opening Parliament. Fawkes' plot was uncovered, he was put to death rather horribly, and a lot of the people sympathetic to his cause spent the following two years preparing to depart England forever. They named their New World settlement Jamestown in order to placate the king whose wrath they were trying to evade.

A century and a half later, their descendants Washington and Jefferson finally finished the job. Although they didn't kill George III or blow up Parliament, Americans did become the first English subjects to permanently throw off monarchy. Since then, most of Ireland has followed suit, Australia nearly did recently, and new Labour is doing its level best here at home. A charismatic and beloved monarch might yet hold the traditions together, but sadly all we've got is Charles. So it goes.

Yet to this day Englishmen annually rejoice in Guy Fawkes' failure, even those who most ardently crave the end of monarchy. Why rejoice? I daresay even those of you who spell Clinton with a K would shudder at the thought of a briefcase-sized nuclear device going off in the midst of a State of the Union speech.

I'm somewhat disturbed by early reports of Mel Gibson's most recent movie, because according to the reviewers it paints a very we/they schism between decent Americans on the one hand and nearly Hitlerian Britons on the other. But truth be known, the average British commoner was far from hateful of Americans. Indeed, a lot of my ancestors were (quietly of course) cheering your ancestors on. Colonists weren't the only subjects who thought George III was unfit to govern, nor were they the only subjects who resented having soldiers ransack houses in search of inappropriate numbers of guns, smuggled (and therefore untaxed) contraband, all the old familiar crimes against the state.

You and we are the same people (well, a lot of us and a lot of you are distant cousins, put it that way) and neither of us ever wants to face the day when we stand helpless whilst soldiers shoot our children in front of us. It is important to remember, however, that in every war that's ever been fought, the vast majority of the soldiers are terrified youths who just want to see home again.

But yes, in every war, there are also the (thankfully few) sadists who relish the opportunities for horror which war provides. Bear in mind, though, that for every redcoat atrocity in 1770s America (not to mention here in England), there was a comparable atrocity in 1960s Vietnam (not to mention Kent State). Indeed, Vietnam was to Johnson's administration what the revolt of the Colonies was to George III's: conquest that was doomed to failure from the start because the people under attack were united.

It all comes down to a simple reality: the only people who live free are those who have the capacity to defend themselves, and that hasn't changed since the Picts kept the Roman army out of Scotland nearly two thousand years ago. Let freedom ring indeed.


--------------
Right, enough pathos for now
--------------

I must tell you a story. A music professor I once knew, Ian MacFadden, spent his summers in America reawakening the ancient art of playing the pipes among descendants of long-sundered Scottish �migr�s. One summer, he was in the mountains of North Carolina, and as it happened he was to be there over the Fourth of July. A few days prior, during a quiet moment, he found himself on the camp's veranda chatting with one of the students, a boy of perhaps twelve years and possessed of the most impressive American accent.

The subject of conversation turned naturally towards the upcoming ho-down (spelling?) and the boy innocently asked Ian, "Is there a Fourth of July in Scotland?"

Oh dear, Ian suddenly realised with embarrassment, what a limited education this poor boy has had. "Ach no, lad," he began, trying to think of the most polite way to explain this, when the boy said with a devilish grin, "Well, what else comes between the third and the fifth?" Gotten. Utterly gotten. By a twelve year old. And Ian chased that twelve year old about half a mile, laughing despite himself, but he never did catch the lad. Twelve year olds accelerate down mountainsides at a substantially faster rate than do fifty year olds. Fortunately for him!

--------------
Well, it's a start
--------------

[see link at top]
According to The Times, the whims of fashion show signs of finally turning back to embrace gold. Evidently silver is no longer sufficient when one wishes to flaunt wealth on one's clothing, and I should imagine the insane prices of the other white precious metals have ruled them out as an alternative. Besides, the ultimate fashion failure would be to acquire a �5000 platinum necklace only to have others think it a �50 silver one.

Go gold!

Yours,
I.V. Holtzman
Journeyman
(07/04/2000; 14:23:39 MDT - Msg ID: 33156)
Does government/Federal Reserve monetary control serve the common good?
http://www.mises.org/humanaction.asp
Quesiton 4: Does government/Federal Reserve monetary control
serve the common good?

The choice of the good [as in "trade good" -j.] to
be employed as a medium of exchange and as money is
never indifferent. It determines the course of the
cash-induced changes [currently referred to as
"inflation" or "deflation" -j.] in purchasing power.
The question is only who should make the choice: the
people buying and selling on the market, or the
government?

....Whatever a government does in the pursuit of aims
to influence the height of purchasing power depends
necessarily upon the rulers' personal value judgments.
It always furthers the interests of some groups of
people at the expense of other groups. It never serves
what is called the commonweal or the public welfare.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 422 [XVII. INDIRECT EXCHANGE 6. Cash-Induced and
Goods-Induced Changes in Purchasing Power -available also from
http://www.mises.org/humanaction.asp]

In case you tuned in late, this post is Mises "answer" to
question 4. of the following six posed in an earlier post: 1.
Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money? |cm:NoShortageOfGold
Henri
(07/04/2000; 14:52:50 MDT - Msg ID: 33157)
"Patriot"
Saw it...liked it. Powerful movie. On reflection, I think the strongest sub-message was the story of the slave "Occum". He started off having less than nothing...he was offered up by his master to take his master's place on the battle line. In the end he stood a "free" man by virtue of having fought for 12 mo. for the Continental Army. Occum then had pretty much the same as everyone else (nothing)but was far ahead of where he had been. There is a well defined line between overt slavery and indebtedness to bankers. The latter is a matter of choice. Is the line as well defined when a bureaucracy imposes heavy taxation...even with representation?

I suppose those who have less than nothing now but do not realize it,(the heavily leveraged) may enjoy a "liberation" of sorts when financial markets collapse. They will then see that all they thought they had was but an illusion of the credit/indebtedness game. Unlike Occum, I sense there will be a profound sense of loss rather than a birthing of hope. I wonder if the name is significant? (Occum's razor?)

When the playing field is leveled the question remains...who were the fools? An individual or family who lived below their means and retained earnings in liquid form, or he who leveraged the high life to exhaustion of the priviledge?

Until that question is resolved, (a necessity drawn from the arrogance/vanity of mankind) the end of the crisis and initiation of the recovery will be beyond grasp.

A moment of truth will come when decisions need to be made.

Those who feel themselves impoverished (I'm guessing the majority) will scream for the heads of those who lived frugally...that their advantage be neutralized. They will be the "new" carpetbaggers.

With the appearence of govt. confiscation of private capital, the field will truly be leveled.

If democracy rules, justice for the individual will depart. Such will be the fall of the once greatest republic these times have known.


Henri
(07/04/2000; 14:57:01 MDT - Msg ID: 33158)
"Patriot"
Aussie though he is, I thought Mel portayed the part well. Just glad I'm colorblind!
Henri
(07/04/2000; 15:05:42 MDT - Msg ID: 33159)
"Patriot"/Occum's Razor
If two or more theories explain the same observations, the principle of Occum's Razor states that the simplest theory is the best.

All the Colonists were not clear about why there was armed insurrection against the "crown". Occum had the advantage of a rather simplistic view of things.



Usul
(07/04/2000; 15:05:55 MDT - Msg ID: 33160)
Piling up debt
http://www.cnbc.com/commentary/commentary_full_story_stocks.asp?StoryID=19090All-American Borrowing Binge
by Garret Glaser, CNBC Reporter
Jul 3 2000 4:15PM ET

"Once upon a time, American consumers frowned on piling up debt, but not anymore. Despite the record incomes Americans enjoy these days, new research indicates that consumers and businesses are on a real borrowing binge.
Wednesday's issue of The Wall Street Journal will take a look at the problem of debt overload in the United States, and CNBC's Garrett Glaser has a preview.

U.S. corporate debt is up 67 percent in the past five years to $4.5 trillion. And household borrowing is up 60 percent to $6.5 trillion...

Bankruptcies, though off record highs, are still way up. Approximately 1.3 percent of all U.S. households filed for bankruptcy last year, up from 0.8 percent five years ago.

And growth in the U.S. economy is slowing...

If unemployment jumps from 4 percent to 5.5 percent, millions could feel the pinch.

And because so many homebuyers are now putting down 5 percent or less on a mortgage, the fear is that they will simply default if they have to.

That's what happened in California in the early 90s. When home values tanked, mortgage defaults jumped. Home buyers simply "gave it back to the bank" rather than try to work out payments...

If that happens on a big scale, the government's Fannie Mae and Freddie Mac agencies, which buy and guarantee mortgages, could be hurt..."


ET- thanks for the July 4th wishes; I thank you
(not as one of the "old enemy", here in England,
but in the spirit of freedom that is embodied in
the US Constitution) and may I offer good wishes to
all in the same spirit.
Usul
(07/04/2000; 15:10:20 MDT - Msg ID: 33161)
Up to their ears in debt!
http://www.dismal.com/thoughts/th_cc_063000.aspRisky Debt Service Burdens, By Celia Chen
The Dismal Scientist, 6/39/00 4:12 PM ET

"Many worry that a stock market crash will end this expansion. While a sudden loss of confidence in the economy may show up in stock prices first and produce a snowballing effect, the debt side of the nation's balance sheet poses as much downside risk for the economy as the equity side. In fact, household indebtedness arguably poses a larger downside risk for a slowing economy than a stock market crash.

The main problem is that indebtedness is concentrated among lower income households who have fewer financial resources to fall back on should they lose a job or even lose some overtime hours and thus are at greater risk of defaulting on their loans. In a worst case scenario, enough households could default to trigger failures in the finance industry that would send the economy into a recession, similar to the real estate crisis of the early 1990s..."
Henri
(07/04/2000; 15:36:13 MDT - Msg ID: 33162)
Sir Perplexed (07/01/00; 20:21:57MT - usagold.com msg#: 33088)
Excellant piece! I have added it to my personal archives.
Peace be with you brother.
ORO
(07/04/2000; 15:58:24 MDT - Msg ID: 33163)
Holtzman - Shudders
The thought did pass through my mind, but the expected shudder did not come. Just a slight sense of panic accompanying the sadness at the prospect of so many dead people and the feeling of a door opening to new possibilities. The initial reaction though, was the feeling that this would be a shock.

Some of the possibilities seen through the imaginary open door did make me shudder, others filled me with hope.

I am sad to say that my response would be similar to that of many.

Perhaps we should all go through this exercize to see what our reactions are.

Leigh
(07/04/2000; 16:08:39 MDT - Msg ID: 33164)
Gold for Oil?
I may have this all mixed up, because I'm not sure I really understand things thoroughly, but has anyone thought that there might be a relationship between the trial balloon about selling our national gold and the fact that oil prices are going down? Could it be that gold is being traded for oil?
Leland
(07/04/2000; 16:56:12 MDT - Msg ID: 33165)
Lady Leigh, Thank you for Bringing up the Subject...
Our friend, Bill Murphy is also working on the problem. Here's a part of his interview on Kitco...

"After the wartime modifications to Fort Knox were made, over 10 years were
allowed to pass before the next major step in 1954. At that time a super-secret
complete inventory was taken of the Fort Knox gold. This was not the same as a
relatively cursory audit, so-called, of the gold which was done in 1953. The
project in 1954 involved a complete count with weighing and assay sampling of all
the gold there--about three-quarters of a million 400-ounce bars worth a total of
12-billion dollars ( $12,000,000,000 ) at that time, and that was at the old price
of $35 per ounce. That's twice as much as the Treasury ever claims to have now,
and even these claims are complete lies. In addition to all the weighing, counting,
and checking against records, the 1954 inventory included the extraction of a plug
of gold from every one-hundredth bar for assaying, and these samples were sent
to Assay Offices all around the country to minimize the chance of any collusion to
falsify the results. This seemingly enormous job was kept completely secret, and
was completed in only nine weeks. All of the gold was, of course, in the Central
Core Vault at that time--none was in the bird-cage compartments..

"The contrast with the so-called GAO audit of the Fort Knox gold last fall can
hardly be overstated. The alleged gold stock in 1974 was only half as large, and
they can only claim to have examined about 20% of that. Assay samples were
only taken from only about every thousandth bar--they were not plugged but
merely small chips were taken which could be taken from a corner, say, without
cutting through into the lead underneath. All the 99 samples were sent to a single
location, the New York Assay Office, and only 54 of these have ever been stated
to have been returned--with undefined results.

"Finally, the results of the alleged 1974 GAO audit--which was performed, by the
way, by 13 Treasury employees and only two GAO representatives--have never
been published. The closest thing to it is a ridiculous little document printed in
February 1975, which presents no findings of fact concerning the gold and timidly
says only "We believe" the gold is there!

"But returning to the 1954 gold inventory, the question arises:

"Why was it a secret? After all, the law requires an annual physical inventory of
the nation's gold reserves.

"This law has been generally circumvented and ignored; but one would think that
when its requirements were satisfied for once, in 1954, the fact would have been
made public. The reason for the secrecy of the comprehensive 1954 inventory,
my friends, is that its purpose was not that defined by law. Instead, the
Rockefeller interests were simply taking stock of the American gold reserves
which they intended to start spiriting away a few years later." ( from the Beter
tapes; 1975 )

It is interesting that GATA is still asking the same question as Dr. Beter asked in
1975: What has become of America's gold reserves? Who owns it? Does the
Federal Reserve own the gold that was once stored in Fort Knox? Or is it still
owned by the Treasury of the United States? In the absence of proper audits (
that Beter claimed should have been carried out every year ) , who is now
responsible for America's gold reserves? Is there any gold in Fort Knox at all? Is
GATA willing to step up to the plate with these questions and find out for the
American people what has happened America's gold? Is GATA serious about a
public audit of America's gold reserves?

Americans would like to know!"
SHIFTY
(07/04/2000; 17:32:15 MDT - Msg ID: 33166)
Leland
When was the interview with Bill Murphy?
Do you have a date?
Leland
(07/04/2000; 17:35:56 MDT - Msg ID: 33167)
Sir Shifty, Here's the Link...An' I'm Still Laughing About Your "Plunger Story"
http://www.kitco.com/Murphy.htm.
Aristotle
(07/04/2000; 17:43:14 MDT - Msg ID: 33168)
You were very helpful for me, Mr. Gresham!
The thoughts you offered to me in your post (7/2/2000; 8:12:28MT - usagold.com msg#: 33096) helped alert me to something that I hadn't considered in my attempts to communicate effectively with my fellow man and fellow Goldhearts. You said--

"Do gold advocates want to strip away all their illusions? ... We couldn't if we wanted to. They will do it to themselves, in time. Just not when we think they ought."

When I read that a bell sounded in the back of my mind--like I was the clapper when the Liberty Bell cracked. You are absolutely right! But it isn't so much that I think my fellow Gold advocates "ought" to see things differently under a timeframe of certain design. Rather, I see how their affinity to Gold brings many of them so close to "economic enlightenment" (and the attendant economic peace of mind,) and yet they remain in turmoil because they don't allow themselves to see things with an ever-so-slightly-different perspective.

In raising my awareness to this element--that some people will always choose to cling steadfast to their own illusions which have over time become an integral part of their identity--you have also served to confirm my thoughts that a different posting approach was in order for me. I have already embarked upon one approach (the designated door mat) which will continue, and as time allows I shall offer an assortment of posts that may be my most effective means to convey some of my ideas. I'll be calling them "The Evolution and Confessions of an Unrepentant Gold Advocate." They will chronicle the path in which I went from being a normal (and happy) person to becoming an even happier and contented Golden-eyed citizen of the World. I'll focus on the missteps I made along the way and how I worked through the pitfalls.

But before I wrap up this post, let me make one quick suggestion/alteration to a portion of your commentary. You said--

"The difference between gold and fiat's seems to be the eternal tension between Man's successes and Nature's endurance. Man can cook up some amazing constructs. The power of illusion. The power of agreement. Fiat currency, like gold, is NOT really anyone's liability. But it exists and carries value by mutual agreement and expectation. This could change at ANY moment -- but probably will not vanish overnight. So the only question is when and how. Once we have prepared our golden refuge, we may join others as curious observers to our own species' glorious folly. ... Nature created gold, just as it created Man's genetic code, and occasionally Man has to acknowledge Nature's work as more enduring than his own."

Great stuff. Yet I would offer an important elaboration on your excellent observation that "fiat currency, like gold, is NOT really anyone's liability." So true! On the face of it, some people might balk, and say "No way!" and point out that this runs counter to my own Saturday comment to ORO where I suggested that "the core of the financial system is The Effort to Service Debts." However, careful consideration will reveal that the dollar currency in your hand is, in fact, NOT in a practical sense a liability. It is a unit of account and a medium of exchange--and precious little else. It is just as you say, Mr Gresham. The Liability that so many Gold advocates point to is misplaced if they point to the dollar. The Liability is found in the terms of the loan and the borrower's promise to repay that which is borrowed.

To state it again, and more clearly, the dollar itself in not a liability, it is just a tool for commerce--an undefined and shifting unit of account which also serves as a medium of exchange. Here's the important part. As a helpful tool for commerce, the dollar is altogether inappropriate for use as savings in and of itself or as a means to denominate your wealth in contract form.

A good carpenter doesn't use a hammer to cut lumber, but that doesn't mean he has no use for a hammer. Of equal note, he does not build a foundation upon a puff of air.

Gold. Get you some. ---Aristotle

PS. I appreciate your comments directed to me and ORO, "Two fine minds meeting -- just trying to grease the interface!" Almost every time I read ORO's replies to my questions and comments I can see how fundamentally close we are. Our differences often come down to that of style and articulation, for which ORO certainly earns the greater praise.
SHIFTY
(07/04/2000; 17:58:44 MDT - Msg ID: 33169)
Leland
Thank you! I dont remember the interview.I will enjoy reading it.

$hifty
Aristotle
(07/04/2000; 18:19:33 MDT - Msg ID: 33170)
For Leigh
I suddenly find myself very short on time--friends coming over to celebrate the day. Sorry that I haven't given adequate attention to your last request of me, but I see that Strad Master offered an answer that was good as Gold, and hard to improve upon. Keep in mind also that the contracts that constitute "paper gold" come in a wide assortment of design, each serving slightly different purposes in the overall orchestration giving us Gold at these prices in these times.

Gold. Get you some at great rates of exchange. ---Aristotle
Leigh
(07/04/2000; 18:42:50 MDT - Msg ID: 33171)
Replies
Aristotle, thank you again for answering my question. I did get some new insight from Strad Master's kind response.

And thank you, Leland! I'd never read Bill Murphy's interview before, so it was interesting information.

Happy Fourth, everyone -- even Mr. Holtzman, who has probably already started July 5th.

CoBra(too), are you still with us? My birthday is coming up in two weeks. If you're reading this, would you please post a picture of a cake for my birthday? Probably all of us remember the scrumptious chocolate torte you posted for Megan's birthday last fall.
Al Fulchino
(07/04/2000; 18:49:33 MDT - Msg ID: 33172)
(No Subject)
Netking (7/4/2000; 1:44:31MT - usagold.com msg#: 33139)
Al Fulchino Re;'A Call to All Who Would be Patriots'
Al Fulchino spare a thought for the British and 'what might have been'!



Dear Netking, I am not sure what direction you were going with your post. I say that to explain that I wondered if you wished to explore all the wonderful possibilities had the British chosen to treat their American colony differently. Can you imagine how wonderful it would have been to have dear old Maggie Thatcher and Ronald Reagan serve 16 years back to back? We are, of course, an extension of all that is and was good with the old empire,as well as what bad can happen and I MUST say that if there was another continent to settle, we would be very close right now to having our own revolution on our hands. The other point I thought you might be heading towards was to have some feeling for the British themselves. I am not sure. Perhaps you could clarify.
Al Fulchino
(07/04/2000; 18:56:02 MDT - Msg ID: 33173)
SHIFTY (7/4/2000; 9:21:54MT - usagold.com msg#: 33145)
Shifty, That was an interesting link you made with the toilets I do get your connection. Perhaps we could accrue "water rights" for time we ah....er.....ummmm
"hold it" for the lack of a better and more graphic way of putting it. THAT WAY, we could get two or more flushes per toilet encounter. Think about it, you could even sell your excess rights. I smell a business opportunity
Al Fulchino
(07/04/2000; 19:07:30 MDT - Msg ID: 33174)
tedw (07/04/00: 33153)Holtzman (07/04/00; #: 33155
ted, hope all is well with you. I agree with your point about more Declaration info. But all in all this was wonderful. Going deep into the movie is not good for those who have not plunked down their gold, but as far as hollywood fare goes, I say, Good job! It isn't "Saving Private Ryan", but it is a wonderful, entertaining reminder of what we do not remember frequently enough

"Holtzman (07/04/00; 14:10:38MT - usagold.com msg#: 33155)
Let Freedom Ring Indeed
We are more alike than different"

AF: God Bless
Al Fulchino
(No Subject)
Galearis (07/04/00; 10:59:06MT - usagold.com msg#: 33148)
@ Al Fulchino re: "The Patriot"
A predisposition to a liking of a movie is usually confirmed with a thrilling experience. However, a more objective appreciation for accuracy and history may foster a different result:
*********
I saw the Patriot with my wife yesterday. It's about an american hero, played by an Australian who was really a slave owning, philandering despot, who had a reputation of atrocity in a previous Indian/French campaign. In short, a typical Hollywood fabrication. For me, the knowledge of the reality spoiled the movie.

Rhody.
*********
But then again one shouldn't really be too hard on a movie if it is a little weak on morality and ethics, it's only entertainment. Remember the "Godfather"? Another fascinating movie that did not have a moral position.

Like Rhody, however, I think it would have been better if they had picked a lead who wasn't a citizen of the British Commonwealth. The tyranny of the dollar strikes again.....

Best regards,

G.
All Points noted, yet the message for me is simple and even can make me shudder at its reality. Have you, Galearis, ever felt you were being pushed around? If so, did you ever see it so clearly that you knew you just had to speak up? I am sure you have. You knew that at that point, rubber was going to meet the road. Either you were going to get fair treatment or you were goingto tuck your tail. As you watched the movie with your wife and saw the militia standing before the Britsh Regulars do you wonder if they were concerned about how hollywood would treat them years down the road? What of the fellow who had a cannonball kiss his face? What of his compatriots? At their moment of truth many of them stared down deaths face, but thankfully they had weapons of their own. If the knowledge of the historical reality soiled your enjoyment, then with all due respect, I think passion and idealism has left your heart.
Leland
Texas Ain't What it Used to be...Oil Companies are Moving out...Don't Count on Texas to Increase Production...
(I found this in a London newspaper. Probably the editors
in the U.S. would squelch this story.)....

Texas in a mess as the oil runs out
By David Wastell in Victoria, Texas

King Ranch, Inc.

Texas Railroad
Commission

Central Texas Oil
Patch Museum

TEXANS are turning their back on oil and their attention to the environment
after almost a century of believing that the best thing about their state was the
"black gold" that lay far beneath their feet.

The pungent whiff of crude oil that still wafts through the oak trees and grassy
pastures of the McFaddin Ranch once spelt vast riches for ranchers such as
Jan Wheelis, and a bounty for every Texan: enough tax and other revenue to
endow schools, build universities and construct thousands of miles of highways.

Now it has acquired a different meaning: rusting well-heads, dead pastures and
polluted water supplies, the mess left behind by an industry in decline. Between
1990 and 1999 oil production in Texas fell 37 per cent from 642 million barrels
to 407 million a year. Ranchers face falling royalty payments and a growing
threat to their land from poorly-maintained or abandoned oil wells.

With the fall in production tax revenues have plummeted while residents of
Texas's sprawling cities worry about the water they drink and the air they
breathe, both rendered suspect by the production and consumption of oil.

Mrs Wheelis, 60, whose grandfather founded the McFaddin Ranch 130 miles
south of Houston in 1878, readily admits that over the years her family have
benefitted greatly from their oil rights. In the peak year, 1978, the 75,000-acre
estate, now divided between herself and nine cousins, earned tens of thousands
of dollars in royalties each month.

Now that flow of cash is down to a relative trickle - "just cigarettes and gas
money", as she put it bitterly - but she is left with a mass of rusting equipment
and many patches of polluted land. She threw a stone into what appeared to be
a large mud-filled pit last week to watch the resulting splash. There was a
revolting orange-brown sheen on the sludge. "That's oil," she said. "We've lost a
cow in here before."

At a still active well, her partner, David Moore, pointed out severely corroding
pipes and the absence of bolts to hold down a Heath Robinson-like contraption,
designed to separate oil from the water that comes up with it. "Can you imagine
what it would be like if this blew?" he asked. "I don't like standing here, it's too
risky."

For the past nine years Mrs Wheelis has been fighting with the small oil
companies responsible for the 16 producing or recently abandoned oil wells and
the myriad of pipelines on her land. A further 57 wells have long since shut
down, although she is not sure if they have been properly capped.

Her experience is mirrored by ranchers across Texas, who in the past year
have formed a new alliance, the Texas Land and Mineral Owners' Association,
to try to force a crackdown on oil firms that walk away from their
responsibilities.

The big-name oil companies with headquarters in Houston and Dallas have
steadily pulled out of Texas, focusing on other more profitable corners of the
world. Their wells have been sold to smaller producers who have struggled to
make money from the oddments of oil left, but are often either unwilling or
unable to clear up the mess created.

Doug Beveridge, who manages land and oil resources for the giant King Ranch
in South Texas and is closely involved with the new group, said: "The old
oilfields are the worst, where a lot of the mess never got cleared up. As they
became depleted the larger companies sold out to little companies without such
deep pockets. They are the ones that go bankrupt or just shut down, leaving
others to clear up the mess."

The result is hundreds of square miles of "dead land", where the ground is
polluted either by sickly-smelling oil leaks or by the salt water that was mixed
underground with the oil, and was allowed to run off on the surface. Here
nothing will grow, and short of carting away tons of soil there is no easy way to
clean up.

Ranchers said their campaign has nothing to do with the presidential aspirations
of Texas governor George W Bush, nor do they blame him for what has
happened.

Mr Moore said: "Landowners are just now learning that the rules and
regulations that are supposed to be in place are not strict enough and are not
being enforced. It's not just under Bush, it's been going on for 20 years."

Across Texas there are an estimated 25,000 abandoned oil wells, and a further
15,000 lying idle but unplugged as cash-strapped companies balk at paying the
�3,000 needed to seal them with cement. Until the last few days, a loophole in
Texas law allowed them to pay a mere �68 per year to postpone plugging
disused wells. Meanwhile pipes are corroding, maintenance is being cut to a
minimum and leaks are beginning to sprout.

There are now signs, particularly in the huge oilfields around Midland, which
supplied most of America's crude during the Second World War, that salt water
and oil residues are seeping into the underground aquifers used for crop
irrigation and city water supplies.

The Texas Railroad Commission, the industry's official watchdog, has been
widely criticised for being too lax with the small companies that have taken on
the ageing wells. A Houston-based executive for one of America's big oil
companies said: "If you're like us you have your name everywhere and you
won't want to be caught with poorly managed wells. But if you're just a little
local company, why should you worry? You can just walk away."

Mrs Wheelis is trying to diversify her ranch away from cattle, corn and other
crops by attracting hunters who will pay to shoot on her land, and by introducing
nature tours.

Even though more than one million Texans still receive oil royalty payments
there is a growing awareness of how the industry that made Texas rich in the
last century is putting its 21st century future at stake. As Mrs Wheelis put it:
"The fact is that right now water is becoming a more valuable commodity than
oil."

(Fair Use For Educational/Research Purposes Only.)
Leland
Lady Leigh, Don't pay any Attention...What a Difference! And, Thank you, Michael for Providing this Opportunity to Discuss our Concerns!
"Date: Tue Jul 04 2000 21:48
skinny (Got my name mentioned) ID#28994:
over on dat 2 bit site...were deh call themselves..sir. and think they are old English
knights or summptin...whata buncha jerks..
Stoopin pretty low when deh gotta mention a common mongrel..
GGGgrrrr bark bark"
Leigh
Leland (and Skinny)
Leland, I'm not offended - I'm actually glad to see Skinny's post! I was afraid he had gotten banished. I like all the Kitco posters. Skinny is welcome to come over here if he ever wishes to; we will dub him Sir Skinny, and he can be a noble hunting hound or a Corgi or something.
Leland
Lady Leigh, you are too Benevolent...I Have a 6 Year-old Greatgranddaughter...I Urge her to Read USAGold...She Does, When She's not in the Swimming Pool
.
Galearis
silver...
This is a FWIW about a little solid indication of a silver shortage.

Just an observation: the scrap silver price spreads are narrowing at Kitco. The prices are also up, and this is not what the graphs would have one believe. Pure silver is $.207CAN and sterling $.192CAN. The change occurred sometime in the last two days. The market is tightening.
Paper/physical prices separating? Maybe....

Best regards,

G.
Journeyman
ORO, Holtzman, Al Fulchino, ALL: GREAT posts today!!!
Al Fulchino msg#: 33135 A Call to All Who Would be Patriots
Here here Al Fulchino!!

ORO, No Shudders here either.

Holtzman, it isn't the British. It isn't the Americans either.

It's the so-called leaders:

"It is not civilizations that promote clashes. They
occur when old-fashioned leaders look for old-fashioned
ways to solve problems ..." -Kenichi Ohmae, _The End Of
The Nation State_, (New York: The Free Press 1995), p.
11.

Regards,
Journeyman
Galearis
@ Al Fulchino re: the Patriot...
At the risk of starting a food fight (perish the thought), my idea of a good historical movie is one which blends accuracy with fiction such that one does not preclude the other. To do otherwise fosters and reinforces mythologies which are probably best left to extinction from a society's collective psyche. There really is no valid reason for inaccuracy except laxity. I for one do not like seeing anachronisms in films for the same reason.

Further to the defense, idealism is by its very nature mired in myth. Have you ever noticed that the best war movies (to keep with this theme) are anti-war movies - simply because they try to be real to their subject matter.

On the other hand, I LOVE a good action movie, if it is well done. However, the good ones don't ressemble comic books, and one can see that the actions of the casts in the plot are feasible and hence work better.

The same can be said for the tawdriest film genre, the horror film.
Alien (my personal favourite) worked best because it was treated as a reality trip by the director (Scott). The only movie that REALLY was scary for me.

Best regards,

G.

P.S. I haven't seen the Patriot. My post was from an email from Rhody who saw it recently. The film seemed to be getting rave reviews so I thought I would throw a little of his water on the fire. Also the one criticism I heard from Ebert on his show dwelled upon certain staginess of some of the scenes. This is also a form of idealism of presentation.
SHIFTY
April Morning
A good film if you can find it. 1988: Tommy Lee Jones, Robert Urich, Chad Low, Susan Blakely, Meredith Salenger, Rip Torn.
Based on Howard Fast's novel, this is a personal saga of the American Revolutionary War, detailing a young man's traumatic transition to manhood on the eve of the battle at Lexington and Concord.
I like this film and it is rare to see it on TV.
"Pure Gold" so as not to be too off topic.

$hifty
Journeyman
Test

Been trying to post answer to question for 5 hours! Is it the message or is it the medium?

Sorry, j.
THX-1138
Movie Review of "The Patriot"
I watched The Patriot twice.
It was not a historically accurate film, and I would consider it more a political film than anything else.

There is a scene where a British Colonel says he knows the rules of war, but has to play outside them to deal with "The Ghost" (Mel Gibson). You could consider this to be an allusion to Bill Clinton knowing the rules of the Constitution but bending and circumventing them for his own purposes.

There was the church burning. Janet Reno and the Waco compound burning.

There is the scene with the guy talking about King George cutting off his leg through taxes. That could be thought of as the IRS and all the "new" stealth taxes being slapped on the poor Americans.

There is the scene with the young boys given guns to shoot the British, or the young kids coming to the swamp with their fathers to join the militia. 2nd Ammendment rights being used and a BOLD finger to the gun control crowd.

Great flick. Two thumbs up. Would give it a 3 1/2 stars.
Not as good as Saving Private Ryan, but ranks up next to Braveheart(also not historically accurate).
Journeyman
Is gold too expensive to be efficient for use as money?
http://www.mises.org/humanaction.asp
SOMETHING won't allow me to post the answer to question 5, so #&@*##, I guess I'll try the "answer" to 6.

Question 6: Is gold too expensive to be efficient for use as
money?

From the point of view of this insight [that the
quantity s 95P
Journeyman
#@*#%

For some EXTREMELY frustrating but otherwise unknown reason, I am not able to post the answers to either question 5. or question 6. of the six posed earlier this week end.

Every time I've tried, it locks up the internet for my machine and I can't reach ANY sites anywhere. Never seen anything like it. I've been trying to post these since 4:00 PM MT. Sorry, but I quit for tonight.

Will try again tomorrow.

Perturbed,
Journeyman
Journeyman
Is gold too expensive to be efficient for use as money?
http://www.mises.org/humanaction.asp
SOMETHING won't allow me to post the answer to question 5, so #&@*##, I guess I'll try the "answer" to 6.

Question 6: Is gold too expensive to be efficient for use as
money?

From the point of view of this insight [that the
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tedw
God Bless America
http://www.usagold.com
There is no country on this earth that has a more marvelous heritage than we.

One cannot look at the history of the birth of this nation and help but see a divine hand shaping his purposes. I think there must be a tear in the eye of the Heavenly Father when he sees how far we have fallen from what we should be.

God Bless America once again, and save us from our sins.
Black Blade
Patriot: Acurate? of couse not, its Hollywood, but.............
Say what you will about General Francis Marion, he was successful. He rose through the ranks from private to brigadier general. He was a semi-literate genius who grasped the rudimentary principles of guerrilla warfare and used them quite successfully against the British who were incapable of fighting a guerilla-style war. They were too regimented and therefore unable to adapt. This seemed to paralyze the British military time and again. A more recent case is the comparison between US General Patton and Brit General Montgomery. If one wishes to achieve victory, then use the more vicious bulldog, and not the timid prim and proper terrier that must stop for afternoon tea. In other words, "Don't bring a knife to a gunfight". The British military never understood this, and as a result suffered the consequences. This attitude plagued the Brits during the revolution in the colonies as well. King George III was a raving lunatic and his policies toward the colonies resulted in revolution. Of course as a US Citizen I have never understood the need or desire of a people to be ruled over for centuries by a family of inbreds, but then that's just me. Perhaps some would relish the idea of a monarchy in the USA, however, I find the idea has a certain stench to it. Granted, most Americans are idiots, just look at whom they elect for their political leadership. All the whining about the bad dirty fighting colonials and the righteous Redcoats is almost humorous. Get over it, it's done. View Yesterday's Discussion.

Netking
@Black_Blade
....So as a result you got stuck with President Bill when you could have had Queen Elizabeth 2nd and some real culture too!.
ORO
Aristotle - comments, installment 3
Workable systems, suboptimal systems, "good enough" systems, the best system.

The description you gave of the non-existent "accepting paper dollars against their will" condition is one of extreme crisis. It is met at the outset and at the end of the life of monetary systems. Under the conditions prevailing at the start of the first incarnation of our monetary system, the very popular move of "soaking the rich" by taxes and by the confiscation of gold specie in 1933, actually did not soak the richest and few coins and bars of gold were lost by the "rich". Most had been spirited away long before the confiscation was done. The party of FDR had made quite a noise about the issue for some years, making it possible for the cautious and the well connected to avoid having their gold confiscated by depositing it abroad and by hiding it without US based insurance. The "hoarding" of specie that FDR referred to in his inauguration speech and which was part of the excuse for the gold confiscation, was a direct result of the threat of confiscation. FDR's overwhelming popularity as the champion of the "little guy", made the prospect of resistance to the confiscation unlikely. The common man simply had no substantial gold to confiscate. The middle class had done their best to hide their gold (stories I heard include the whole gamut of methods, some foolish, some smart, some futile), and the rich had only to put their gold abroad.

The "near end" in the 70s was not quite as intense a crisis as it had potential to become because of the support granted the dollar on international markets by the central banks of nearly all nations because of the need for avoiding the expense of the cold war in Europe and elsewhere. Germans and French were taxed by the monetary reserve system for the purpose of supporting the dollar, allowing the US to escape the consequences of its over-issue of debt and its growing exports of dollars.

Today, international support on this scale is not available. View the proposition put forward by Leigh; that the US is no longer in a position to convert dollars into other people's gold at a fixed exchange and must test the waters regarding the trade of its own gold for oil imports. Like the man at the grocer's who has accumulated too high a credit balance and is asked to pay in cash. "You are my best customer, but you pay off such a small portion of your outstanding bill that keeping your custom is just not enough of a reason to accept your credit. I would do just as well if I closed shop and we were both ruined- because I can't afford you, and you can't afford yourself."

In my experience, resistance to accepting fiat money is done quietly and in hushed tones. People start second jobs as freelancers that are "under the table" and settled in cash. The prices for payment in the declining currency are higher than they are for payment in "hard" currency or gold. Contracts become indexed to certain items, currencies, etc.. The people with freelance jobs (most people) provide less of their time to their official employer who has to pay in the local currency. The consumption statistics grow out of sync with the income data. Corporations accumulate their profits in inventory just as people buy on credit wherever possible, and change all cash into tradable goods or just spend every bit of it as it arrives. Rents are denominated in foreign currency and the used goods trade blossoms. At some point, the banks go under and their obligations are taken over by government. The stocks of exporting corporations goes through the roof, and the method of payment for top talent becomes missions abroad (used for the purpose of opening secret bank accounts) where the workers can be paid in foreign currency rather than converting it into the home currency and paying the worker at home.

Eventually, after passing draconian laws to prevent the underground economy from expanding, the government gives up and allows official indexing of rent prices, government debt, bank accounts, wages, etc. The benefits to government from further inflation of the money supply are limited by the escalation of indexing and the breakdown of taxation which is avoided by the "going underground" of whole professions when government expenditures threaten to grow. Occasionally, massive amnesties for escaped taxation and hidden funds are granted.

Outright overt resistance to legal tender law becomes a matter of degree and a matter of government effectiveness in combating the alternative payment and contracting devices. Modern popular democratic governments back down and accommodate at least some of the (formerly) illegal practices long before confrontation with popular action is necessary. Even wildly unpopular dictatorships avoid this confrontation.

Best for whom?

The question of the "workability" of an inherently self destructive system is not answered in economic studies, but in political analysis viewed in economic terms. The question is "why does this impossible system seem to work?". This raises the corollary questions of "work for whom?", "seem to whom?", "what is it they see?", and "who pays for the inefficiencies and destruction inherent in the structure of the system?". Of course, this raises another question; "why is the victim willing to pay, and how is the beneficiary exacting his dues?".

This political analysis and its economic consequences has been presented here before. FOA and ANOTHER presented additional portions of it. The "excess demand" resulting from expansion of the US money supply and the expansion of its substitutes is provided by goods imports and the export of dollars and dollar securities.

The scale of imports is distorted so that imports seem smaller in nominal dollar terms than their economic significance actually is. The distortion ranges from 30% understatement of imports from the EU, to 80-85% understatement of imports from China, Malaysia, and Brazil. The distortion is such that even nations that are exporting goods and services at new records every year in terms of volumes are still finding it difficult to maintain a positive current accounts balance even without substantial growth in imports. In some cases, the dollar reward for a manufacturing and assembly process using imported components and materials is nearly non-existent by the time foreign debt payments (in dollars) and patent royalties are calculated into the cost. In essence, the transformation of silicon chips plastic and metal into a DVD player within Korea is nearly free for the American.

The distortion is maintained through the dollar debt balance of foreign countries and corporations in what can be described as a short squeeze. The EU and Japan suck dollars out of the international markets and into their reserves, and cause the dollar to be bid up in the Newly Industrialized Nations, who now must sell more product and import less in order to service the same debt. This was done, for example, in the preparation of the "Asian Flu". The squeeze was put on by rising oil prices and rising dollar interest rates coupled with the rapid dollar reserve growth in the EU and Japan. In order to service the greater dollar debt burden when dollars were made artificially scarcer, the "Asian Tigers" had to increase sales, which could only be done by devaluation of the currency. The devaluation made it more difficult to service dollar debt by non-exporting dollar debtors within each country, and forced the acquiescence to IMF "assistance" in rolling over loans at the worst possible terms the governments of these nations were willing to accept � in order to avoid default, which would have been the healthiest step these nations could have taken; it would have put all capital imports on a cash flow basis and avoided the mechanics of debt traps in the future. IMF "assistance" meant that title to substantial portions of local productive infrastructure had to be offered to the EU, Japanese and American banks and corporations at prices well below construction cost.

To give a rather extreme example, Brazil exports over 40% of its GDP, yet has barely managed a positive current accounts balance. Granted that Brazil's government has a history of economic mismanagement (particularly of monetary affairs) second to none, however, the economy there had grown steadily (e.g. per capita real GDP is up 1.5% per year since 1985� better than US and other industrialized nations) the population has seen only half of the benefits of their increased productivity, and even less of it today.

In Mexico, the rapid rise in population has kept per capita real GDP steady, however, Mexican per capita real income has fallen 20% over the last decade.

In South Korea, the last decade saw a near doubling of productivity, but only a 50% rise in real wages.

In Germany, productivity is up some 30% over the 90s, yet Germans saw only a 21% rise in living standards.

In Japan, productivity is up 30% over the last decade, but living standards have gone up only 15%.

(All consumption figures include government spending)

If the Japanese, Germans, Koreans, Brazilians and Mexicans don't enjoy the full benefits of their productivity who is it that enjoys this margin between productivity growth and living standards? Could it be us? If nearly everyone around the globe is producing more but consuming a smaller portion of their production, who is it that is consuming more than they produce on a consistent basis? Americans perhaps?

Could that be the reason the dollar maintains value and the process of "reverberant doubt" is delayed?

At this point, without looking at later consequences and without viewing the details of how this is done, I can more than agree with you, Aristotle, we not only have a workable system for ourselves, but perhaps the BEST possible system FOR US � if we can make it last.

Black Blade
@Netking
Oh well, I have to admit, it is more fun to elect your Tyrant rather than it be an accident of birth. ;-)
Topaz
Galearis (Rhody) Patriot

FYI- Mel Gibson was raised in Australia although his Ancestory was American (Father had a broad US accent). Mel's antipodean up-bringing no doubt provided him with the depth of character, screen presence and Worldly awareness that so often is lacking in home-grown "Leads" .
Yul Brenner did a good "King & I" though .

Best Movie of late--- Fight Club.
Black Blade
The more differrent we are, the more we are alike!
I might add that we get Tyrrany in four-year increments, then have the option of four more years, or get a new Tyrant. On another note, somehow, I just can't quite picture a couple of blokes in a London pub arguing over how King John's signing the Magna Carta was such a raw deal. In many ways we are very much alike. But then again, we don't have Charles and camilla, instead we got Bill and Monica. Hmmmmmmmmmmmmnnn............
Topaz
'archy's-n-stuff
@ Black Blade-Netking et al
Am in the throe's of reading "The Red Chief" by Ion Idriess, in which he gives a first hand account of life, loves and structure of an Aboriginal Clan pre White Settlement.
The thing that stands out (relevant here) is the complexity of Government within this "primitive" group and for 1000's of years the same structure had survived.
Yup- you guessed it, A Monarchy.
The difference was the "King" wasn't numero-uno, it was the Witchdoctor and any decision made by King and council had to have his (tacit) approval. If they varied from this they got the "BONE"- a fate worse than Death!
Our (the British) system has been abused to the point of (almost) irrelevance- however the noble Structure is still intact and I for one am glad of that.

A recollection regarding the Fathers of Federation attempting to install the Head of the Scottish House of Stuart as King of America comes to mind but alas I can't recall the source- perhaps Sir Holtzman can assist?
Turnaround
Journeyman,ORO - Martin Shubik paper
http://www.santafe.edu/sfi/publications/Working-Papers/00-03-021.pdf
ORO (07/04/00; 10:53:18MT - usagold.com msg#: 33147)
Journeyman, Turnaround - Martin Shubik paper
I have not given the whole paper a thorough reading, but I would like to criticize a couple of points already.

From the text:


"Not enough money An economy will not have enough money, if at an equilibrium there is no way to redistribute the money such that all individuals can avoid a cash flow constraint.."


Would not price discovery address this concern?


ORO: Comments:
In this treatment, Shubik ignores a number of issues and ignores the main point of having a commodity money:

1. The trust in political and banking powers has not once been demonstrated to be placed where it belongs. History has revealed repeatedly that neither banking nor government are trustworthy. Analysis of the "natural" character of these "agents" shows that neither is structurally capable of avoiding mismanagement of fiat money. THE EXISTENCE OF FIAT MONEY AND THE CONCEPT OF MONETARY MANAGEMENT ARE INHERENTLY CONTRADICTORY TO PROPER FUNCTION OF THE FINANCIAL MARKETS.

To expand on this point a bit:
****

Repeatable Results

Scientific theory derives its validity by building on the prior established knowledge base.
That knowledge is originally discovered from repeatable experiments conducted in the
real world. (The purpose of the laboratory setting is to eliminate as many uncontrollable real-world variables as possible. If an experiment returns reproducible results from a "noisy" laboratory environment, this is a further verification of the strength of the observed effect.) A new theory, or model, that faithfully describes the prior experimental results is then verified by its ability to predict novel behavior.

This is the essence of scientific inquiry and the basis of our knowledge of the real world.

Though it has recently become possible to simulate life-like processes via computer modeling, these
results must always be checked against the empirically established facts. A model is necessarily subject to simplifications introduced by its theoreticians to make the problem tractable. These idealizations can introduce unforeseen errors that invalidate the theory.
Socioeconomic theory, in particular, has been hampered by the introduction of idealized behaviors, generally reducible to "working postulates", that have no counterpart in the real world. This was a central failure of Karl Marx's predictions- the postulate of worker solidarity was shown to be in error. This failure was predictable from the prior, empirical evidence.

Example Theory-
Objects fall to the ground. Planets orbit the Sun.

Gravitational theory, or the "law of gravity" was originally developed by Isaac Newton, by collecting and synthesizing the results of real-world observations into a coherent model of how the universe works. That model was then subjected to several centuries of testing and validation. Its limitations led in turn to Einstein's General Theory of Relativity, which returns Newton's laws in the limit (v/c-->0, mass density-->0). In no known case do these theories depart from empirical observation, excepting gravitational singularities.
Newton's three relations of motion provide an example of a subset of experimentally derived, orthogonal "working postulates", ones that still permit useful results, but were subsumed later by a more elegant set of postulates.

A designer of a new theory of gravitation, such as "quantum gravity", is therefore required to show that his theory will return Einstein's results in one limit, then Newton's in a further limit. It must be in agreement with the empirically derived knowledge- the results of centuries of observation and deduction. To be useful, it must also give rise to new predictions that can be verified through experimentation.

If one attempts to build a new theory that incorporates antigravity, it is the investigator's responsibility to
refer to any prior experiments conducted in the real world that would support his contention. A computer simulation cannot be relied on in this case, as it is not currently possible to model the physics with the necessary fidelity.

As there are no known experiments that conclusively demonstrate antigravity, an airplane designer or a transportation network planner cannot utilize a new gravitational theory that incorporates this effect.

Money Theory

One branch of socioeconomic theory is the study of money. The use of precious metals, commodities and fiduciary media have all generated rich data sets, extending back several millennia in some cases.

It has been observed repeatedly over the past few centuries that a paper (or its electronic equivalent) money returns to its intrinsic value of zero. This experiment has been run under widely varying field conditions, which serves to reinforce the validity of the results. The currently running experiments, though still in progress, reproduce this behavior quite faithfully. Therefore, a putative General Theory of Money can take this as a working postulate:

1. Paper money returns to its intrinsic value.

The claim is sometimes made, for example, that the fiat 'US dollar'* has replaced gold as the premier international trade instrument. The evidence presented includes the recently falling dollar-denominated price of gold. The claim ignores the attendant unbounded inflation in gold-denominated instruments. This experiment has also been run on numerous occasions over the past few centuries, always returning the same result: a loss of confidence and a concomitant bank run. This is an empirically derived fact, based on several centuries of observation.

The observed behavior of a fiat currency in its final approach to the natural value is caused by a similar reaction on the part of its holders- a loss of confidence. This in turn appears to be caused by a lack of trust in the issuing authority. In each current and historical experiment with fiat currency, the issuer creates more (or "increases the money supply" in monetarist terms) than the market requires. Some of the newly invented money is then used (by the issuer) to create an artificial demand, thus introducing distortions in the economy. This occasionally causes enough economic damage to result in war or revolution. As the issuer is either a government or its proxy, this loss of investor confidence can also be expressed as a working postulate:

2. Government cannot be trusted to issue fiat currency.

Again, the currently running experiments agree with the results from prior runs, most spectacularly in the case of the 'US dollar'. Its status as the world reserve currency has not reduced its predicted (based on working postulate 1.) behavior, but rather appears to have accelerated the minimum-seeking process.

A more sublime General Money Theory would return these results in the limit (confidence -->0).

*Note: Single quotes are used for 'US dollar' as this can no longer be strictly defined as money. Cf Alan Greenspan's acknowledgement to this effect.

Black Blade
Morning Wakeup Call! The War Continues!
Sources: Reuters and Bridge News.Asia Precious Metals Review: Platinum flat after Tuesday slip
By Hiroyuki Fujiwara, BridgeNews

Tokyo--July 5--Spot platinum was underpinned at about U.S. $545 per ounce supported by light bargain hunting in Wednesday's Asian trading following a price slip overnight, dealers said. Gold consolidated in the sluggish market as the U.S. market remained closed for the Independence Day holiday, they said. Platinum declined overnight on expectations of supply from Russia, while expectations of strong physical demand continued to encourage speculators on the Tokyo Commodity Exchange (TOCOM) to buy platinum
futures, the dealers said. TOCOM players were willing to proceed with bargain hunting following a price decline in the past few days, they said.

Black Blade: Rumors of PGM sales. These rumors have been around for the last year, yet no PGM. Still looks like a tight market. Shorts slamming gold in lightly traded non-US markets. Could be interesting when NY opens. Gold is also off as oil is down on speculation that the Saudis will increase output. Strange thing is the Saudis can probably increase only slightly, yet refining capacity is extremely limited. In other words, nothing is changed.

Norilsk Nickel says starting platinum sales to Japan in few wks

Moscow--July 5--Norilsk Nickel, Russia's giant copper, nickel and platinum-group metals producer, said Wednesday it would start selling platinum to Japanese end-users "in a few weeks." Norilsk Chairman Yury Kotlyar also said the company was satisfied with the price offered by Japanese buyers during recent talks. (Story .11937)

Black Blade: Yeah, right. Heard it all before.

THE WESTERN FRONT:

Turkey January-June gold imports 101,325 tonnes

Istanbul--July 5--Turkey's January-June imports of gold and silver through the Istanbul Gold Exchange amounted to 101,325 kilograms and 74,920 kilograms respectively, the exchange told BridgeNews exclusively on Wednesday. It said the corresponding figures in January-June 1999 were 61,680 kilograms, and 32,000 kilograms. (Story .11574)

Black Blade: A nice near double over a year ago.

Europe Precious Metals Review: Gold above $286, platinum lower
By Gavin Maguire, BridgeNews

London--July 5--Gold prices continued to lie dormant in a U.S. $286-288 per ounce range Wednesday morning as players awaited the return of U.S. dealers from Independence Day celebrations. Sources said very little change was expected, however, as spot metal looks well confined by the $280-295 range that sealed trade for all of last month. Platinum softened on news that Norilsk Nickel was to start sales to Japan "in a few weeks," although conditions remained light. Dealers said spot metal was expected to gradually drift lower over the coming days as support at the 10-day moving average--around $286.85 this morning--"gets slowly eroded away," a dealer said. He added that physical interest is expected to continue to recede toward the $285 mark over the medium term, while profit-takers "will be tempted to jump in at lower and lower levels." However, he also said physical demand is expected to remain firm around the $285 area, "so the outlook for now is more sideways trading." In the news, Russia is expected to increase primary gold output this year by 10-15% on the year, Chairman of the State Depository for Precious Metals (Gokhran) and Deputy Finance Minister Valery Rudakov said Wednesday. He said Gokhran planned to purchase 30 tonnes of gold this year, up from 18 tonnes in 1999. Silver trade was very light in the $4.95-5.00 area, and dealers expected further $4.95-5.15 range-trading to define trade over the medium term. Platinum slipped to a 13-day low around $535 on renewed Asian selling following news that Norilsk Nickel, Russia's giant copper, nickel and platinum group metals producer, said it would start selling platinum to Japanese end-users "in a few weeks." Norilsk Chairman Yury Kotlyar also said the company was satisfied with the price offered by Japanese buyers during recent talks. Dealers said some players were wary of pre-empting the sales by selling in large volumes "because of the dubiousness of all news on PGMs out of Russia," in the words of one. However, a return to the $520 in the near term was on the cards, he suggested. Palladium was dragged lower in platinum's wake and eased to four-week lows in the $613 vicinity in very light trade. However, the 10-dma around $606 is expected to stem the tide should further weakness come about, a dealer suggested.

Black Blade: That about says it all. Even many dealers are doubious about PGMs. Gold appears to be falling in sympathy.

Meanwhile, S&P Futures are down -2.50, fair value up +2.19, indicating a slightly higher open on Wall Street at this level. Au down -$2.60 at $286.80, Ag down -$0.02 at $4.98, Pt down -$23.00 at $538.00, and Pd down -$30.00 at $610.00.




silent runner
Americans
Black Blade..you wrote< most Americans are idiots> thats not true. Most Americans are kind generous people who are represented by a disfunctional government and a polluted hollywood culture. Americans a good people.
USAGOLD
Today's Report: Interesting Weekend
http://www.usagold.com/Order_Form.html7/5/00 Indications
�Current
�Change
Gold August Comex
288.20
-3.30
Silver July Comex
5.05
-0.03
30 Yr TBond Sept CBOT
98~00
+0~10
Dollar Index June NYBOT
106.66
nc


Market Report (7/5/00) Gold shunned any fireworks displays over the long Independence Day
holiday opting to weaken overseas. That weakness carried over to the New York open with traders
all-around blaming gold's weakness on oil. If it is oil making gold feel a bit of a summertime lilt,
it's not likely to last long. The Saudi announcement about production increases is more in the
"sound-and-fury-signifying-nothing" genre than it is a solid policy the goal of which would be to
appease "the hard-running-let's -get-Gore-elected" Clinton administration. Plummeting poll
numbers can serve as inspiration to a party's leadership. As the markets digested the Saudi news,
most of the nation's morning newspapers were running a New York Times article warning of
more shocks for the American consumer in the energy sector -- this time from heating oil and
natural gas which experts are saying will increase home heating bills by 30% or more this winter.
The latter story nullified the former. It seems that good news or bad news, take your pick, last no
more than the space between editions these days. When all is said done though, how many in
either the political or financial sectors really believe that the Saudi's would go over the line in
sabotaging the coalition/cartel it worked so hard to assemble over the past 12 months? Common
sense wills out.

If gold is reacting to something/anything this morning other than the typical summer doldrums, it
more likely has to do with Commitment of Traders numbers than it does oil -- at least today.
(We'll see how the oil story plays out in due time.) With about twice as many large speculator
longs (31,821)as shorts (15,602), some traders see the overhang as bearish for the yellow metal.
That, of course, depends upon whether or not the longs have been assumed for good reason and
whether or not the trend will continue. Either way you slice it, though these are low volumes and
not likely to be a factor in this market for long.

In other gold news, Russia declared that it would jump gold output from 10% to 15% but before
the shorts get too enthusiastic about this gold getting to market they must take into consideration
that producing gold and getting that production to market are two distinctly different problems.
Even if one were able to sort through the logistics of distributing anything in or out of Russia -- a
maze with more nooks, crannies and passageways than the Kremlin itself -- one would have to
make a further determination: Who's in charge in Russia and what is their policy toward gold?

The most interesting news of the weekend was emanating from foggy Londontown where a
supposed rift within the Blair government was developing over whether or not Britain should tank
the pound and hitch its wagon to the euro star. I say "supposed" because one wonders how deep
the divisions really are within the Labor government on the euro question. (If there is a real rift,
my guess is that some think time would increase Britain's negotiating advantage.) The Tories
should have no doubts where they stand though. Or do they? It is at least interesting, if not ironic,
to realize that as the United States was busy celebrating its sovereignty from Britain, the British
were debating whether or not to give up theirs. If national sovereignty isn't a Conservative isse I
don't know what is? The plea for Britain to join the single currency on the basis of the pound
being too strong (as advanced by four prominent British industrialists) is pure nonsense. If Britain
were truly interested in a weaker pound, such a goal could be accomplished with the right pressure
in the right places. Transfer that sovereignty to the continent and no such option would be possible
even with a hat-in-hand visit to Brussels. So what says Iron Maggie about all this? Her absence
from the discussion (at least as much as I have seen of it) in some British policy circles must be
akin to the "awesome silence from above."

That's if for today,fellow goldmeisters. Have a good day and we will see you back here
tomorrow.

An Invitation:

I would like to invite those who take an interest in the type of analysis read here to give our
newsletter a try -- News & Views: Forecasts, Commentary & Analysis on the
Economy and Precious Metals. This month we focus on oil and inflation. Many analysts and
investors think there very well may have been a fundamental shift in economy that could favor the
gold market and hammer the equities and dollar market. These opinions from various sources are
covered in some detail in the upcoming July issue. Along with the latest issue of News & Views,
you will receive our Gold Almanac 2000 which offers fundamental background on the yellow
metal. The theme of this year's Almanac is wealth preservation and one of the key articles is
how those in the 1970s -- a decade many are comparing to the present -- not only survived double
digit inflation, but prospered. The package is offered at no cost or obligation. You can call
Marie at 1-800-869-5115 to request the newsletter and Almanac or click above.

Black Blade
@silent runner
I agree that Americans are generally a good and generous people. As an American (US) I thank you. However, we as Americans have made some "idiotic" decisions that have resulted in the "dysfunctional government" that represents us. We the people, make the collective decisions on who our representatives are. Looking at who the candidates are in the upcoming elections, all that I can say is: This is the best we Americans can do? We as a people are easily swayed with sweet words and grand promises as well. We like to hear these things, though we know that they are out-right lies (the basis of commercial advertising). ultimately, it is us, we the people who have to take some personal responsibility for the mess that we create for ourselves. So I probably should say that most Americans tend to make many "idiotic" or even "stupid" decisions as evidenced by our political leadership and the resulting over-regulation of our daily lives. Everything comes with a price attached. We sell our freedom and liberty for what is percieved to be security. The freedoms, liberties, and rights that we as people once enjoyed and considred a birth-right are now gone for dubious reasons ("for the children", "the greater good of society", etc.) We only have ourselves to blame when the corrupt parasites (politicians) live off the blood, sweat, and tears of the people. I might add, it is that because Americans are a generally good and generous people, we tend to believe in the best of people and not the worst. This has come back to haunt us through out our history. Gee silent runner, now I'm really getting depressed. Again I thank you, perhaps "idiots" was too strong an word, maybe I should have said "Naive".
Christopher
Musings from the back of the classroom re: the revolution
I have always been a history buff, and have always gravitated towards the past, whether it be the novels that I read, my geneaology, or metal detecting some long forgotten site in the deep dark woods. The past, it seems is filled with mystery and insight and knowledge, just waiting for those to uncover its information and bring the truth once again to the light.

As I read these forum pages day in and day out, I get an idea of the character of its posters; their interests and avocations, their loves and obsessions. And these insights collected together have drawn me to some conclusions which flitter about inside my head, just out of reach of the light, but close enough to send shivers down my spine when their shadows brush by me and the truth they contain presents itself.

What does this rambling have to do with gold you may ask? I'm getting to that in a round about way. The last couple of posts have prompted me to speak on these things: Gold, Freedom, Patriotism, and The Revolution.

This site is primarily a Gold discussion forum, but on its edges these topics of freedom and patriotism are always alluded to and seem to go hand in hand in the underlying currents of discussion. The Ladies and Gentlemen that speak so knowledgably about the former, also espouse the latter in their words whether consciously or not, I do not know, but it is there for all to see. Gold and Freedom are inseparable. You should not be able to have one without the other. Dare I say that you can not have one and forego the other. And does not this statement allude to in some extent, the situation that our once great country finds itself in? Are we as free as we once were?

Yes those of us who have exchanged our fiat for gold are, in a sense more free than most of the masses, but as the statement implies the mass of the people are not. We are definitely in the minority.

So, what to do? We know from past example what the masses will do. Will they not do anything until the misery is so excruciating that it awakes them from their fitful sleep? How long that will take is anyones guess, I have no idea. And then what? They will look for leaders to guide them out of bondage and back into freedom. They will look for that corps of patriots whom they once labelled as "crazy", or "troublemakers", or any other number of nomers that we like to pin to those who cry out in the wilderness.

You, ladies and gentlemen, are these people. You are the leaders of the revolution, that small band of patriots not afraid to stand, and as scary as that seems I humbly number myself among you. I do not like the idea, but I am afraid it is the truth. I have felt this way for a long time, about the people here.

Now, what to do, patriots, what to do?
There is history here in the making. The truth must be told, and I thank you for the commitment that has been made here regarding the truth.
May God bless us all, as I feel the time grows short for further preparation.

Let us be diligent my friends to the task we have assigned ourselves.

Veritas Tametsi Caela Cadant
Peter Asher
Subject of the day, not just here
http://www.msnbc.com/news/428878.asp

War of words
over �The
Patriot'
Hollywood's horror over
conservative family
values
By John H. Fund
MSNBC CONTRIBUTOR

July 4 � In 1996, when director Roland
Emmerich made his last Fourth of July
spectacular, "Independence Day," both
presidential candidates endorsed his film.
But that was science fiction. His latest
film, "The Patriot," is about the founding
of our nation and some of it rubs
politically correct elites so raw that they
slapped an "R" rating on it for portraying
children defending themselves with guns.


MANY CRITICS have tried to dismiss the
epic as simplistic, tub-thumping patriotic drivel.
"There isn't an idea in it that will stand up to
thoughtful scrutiny," huffs PBS critic Roger
Ebert. Other critics claim "The Patriot" lacks
heart. "There is no majesty, no feeling here: it's
all FX and costuming," says Stephen Hunter of
the Washington Post. This is bizarre for a film
that dwells on the human impact of war on
family and loved ones.

Still other critics
correctly see
"Patriot" star Mel
Gibson as the next
John Wayne, a new
embodiment of
American
individualism, and
they don't like it one
bit. "The Patriot is right-wing hogwash bathed in
an olde-timey golden glow," writes Arion Berger
of the Washington City Paper. "Now the
disgruntled, home-schooling, SUV-buying,
pro-militia-but-cautious-suburban-family-values
working man has a movie to call his own." This
about a film that barely mentions the tax revolt at
the heart of the American Revolution.

CONSERVATIVE FAMILY VALUES

Time out. Now we know in part why so
few Revolutionary War feature films have been
made - less than a dozen compared to 407 on
World War II and even 72 on Vietnam. It's not
just the strange costuming or a reluctance to
make the Brits the bad guys.

"What you've got is folks that Hollywood would think are �right-wing Christian gun nuts,'"
says film critic Michael Medved. Indeed, Mark Gordon, who
produced the acclaimed "Saving Private Ryan,"
admits that the Motion Picture Assn. Of
America was upset by the scene of an
11-year-old firing a musket after British soldiers
had killed one of his brothers. It led to the film's
"R" rating. "We really wanted to get a PG-13
for "The Patriot,' but there was no way," a
Sony Pictures executive told the Los Angeles
Times. "The ratings board is very sensitive to
any connection between violence and children,
and here it's intrinsic to the story. Take it out,
and the whole movie falls apart."

REMEMBERING �SHENANDOAH'
�Now the disgruntled, home-schooling,
SUV-buying,
pro-militia-but-cautious-suburban-family-values
working man has a movie to call his own.'
� ARION BERGER
Washington City Paper film critic
Screenwriter Robert Rodat, who wrote
"Saving Private Ryan," defends the scene by
pointing out the film immediately shifts to the
boy telling his father (the Mel Gibson character)
that he's glad he killed a soldier: "The look of
dread on Mel's face shows us the repercussions
of their actions. What scares me is violence that
is realistically depicted with no repercussions."
Indeed, there have been many films depicting
children involved in combat that haven't earned
an "R" rating. The Mel Gibson character
resembles the Virginia farmer played by James
Stewart who tries to save his family from the
Civil War in "Shenandoah." Films showing
Jewish children taking up arms against Nazis in
the Warsaw Ghetto uprising have been hailed.
So too have those depicting children
confronting policemen enforcing apartheid in
South Africa. A double standard here shouldn't
apply to depicting war on the home front.

NO BEEF WITH THE BRITS

The British do
have a proper beef
with some elements
of the film. Even
though this is the
first movie project
the Smithsonian
Institution has ever consulted on, dramatic
license takes over at times. The most memorable
atrocity - the burning of a church with the
congregation inside - can't be found in
Revolutionary history. But the British are not
portrayed as Nazis, as hysterical reviews in
British papers have claimed. Jeremy Isaacs, the
British actor who plays the Darth Vader-like
Colonel Tavington, notes that in the film, "My
superiors are very unhappy with the way I'm
behaving and my men balk at carrying out the
orders I give them. So the notion that the British
are represented badly is nonsense. I am the bad
guy."

PERSONAL FREEDOM
It's easy to read too much into "The
Patriot," which most people will go see as a
crowd-pleasing adventure. But unlike many
popcorn dramas, there is meat on its bones.
"This film is about personal freedom - which
many people take for granted today," says Mel
Gibson. Its essential message is the same one
that Thomas Paine told the colonists about in
his pamphlet "Common Sense." It comes from
the Israel of the Bible: Sooner or later, the king
unchecked will come for your sons.
That should be a universal message, untied
to any ideology, since tyrants have come in all
hues, shapes and sizes throughout history. It's
time for a cease fire on the politics of "The
Patriot," and for critics to appreciate it on its
own terms and not through the lens of their own
contemporary sensitivities.



John H. Fund is a member of the Wall Street
Journal editorial board and a regular
contributor to MSNBC on the Internet.

Leigh
Current Gold Quotes
Kitco - Gold down $6.10
MCRI - Gold down $5.40
www.thebulliondesk.com - Gold down $1.90

There's a wide range here! Does anyone know which quote is most likely to be accurate?
TheStranger
The Saudi Production Increase Announcement
The jump in the transports this morning and the drop in energy stocks are good examples of how people sometimes trade first and think later. Saudi Arabia and the UAE are the only oil exporting nations which are believed still to have excess productive capacity. But most Saudi oil is sour (high in sulpher content). This grade of oil is not suitable for American gasoline refining and will not help reduce U.S. pump prices.

This reality is why last month's OPEC production increase was followed by HIGHER, not lower, prices. Remember, the world did not get an oil rally in 1999 strictly because of production cutbacks. Global economic recovery was an even more important influence. Today, nearly all exporters are running at full tilt. No, as Michael suggests, there is more of politics than of economics to the Saudi announcement.
Knallgold
Another fine detail
IF Goldman will really kill any rally at 310-320$,that would also imply that they will probably kick Barricks ass.Remember their 319 calls ,bought with big tamtam and designed to reduce their hedge considerable ?
And ultimatively,GS will protect JPM,those who sold the calls to Barrick.But dont use the word cabal here...

But I have still the opinion that GS bluffs with their alledgedly selling in this range.

Leigh,my real time quotes say 283.9 284.5.Dont worry,Don_L. on the other site says it wont fall below 280.
TownCrier
An update to the Week in Gold!
http://www.usagold.com/wgc.htmlThanks once again to the World Gold Council for sharing their weekly commentary with us at USAGOLD. Notable from this week's text is this first word on gold holdings out of Singapore:

"Under the auspices of the IMF's Special Data Dissemination Standard the Monetary Authority of Singapore has revealed, for the first time, the amount of gold held in its official reserves. As at end-May holdings are reported at 4,096,439 ounces, equivalent to 127.4 tonnes; this includes gold loaned to or, where appropriate, swapped with commercial banks."
Hard assets...Easy access
Centennial Precious Metals, Inc.
http://www.usagold.com/ProductsPage.htmlMany feel that the current economic climate portends rising gold prices. If so, you will want to be properly positioned to profit from the trend. For others, especially in potentially volatile times, the preservation of wealth is paramount. In this respect, the role of gold is well known. Whether to profit or to preserve, perhaps the most comfortable portfolio approach is embodied in Robert Frost's poetry: "We will go with you, O wind!"

Diversify. And let the winds carry us where they may.

Let Centennial assist you with all of your precious metals needs. It is your decision to do business with Centennial that makes this website possible. Thanks for your support--past, present, and future.
TownCrier
Increased Saudi Oil Output to go to China?
http://biz.yahoo.com/apf/000705/china_oil.htmlHEADLINE: Chinese Oil Imports To Rise

Although China is the world's fifth largest producer of oil, growing demand from booming economic growth changed transformed China from an exporter to a net importer in 1993, with oil demand expected to grow by four percent each year going forward.

Recent signals from Saudi Arabia that it may increase oil production was said to be in order to maintain the prospects for continued world economic growth.

TownCrier's bottom line: With such global awareness, how much longer will the Saudis continue to support an oil payment arrangement (dollars) that so clearly favors a single nation over all of their other customers?
wolavka
meats and grains
turning up again, more solid inflation.

watch for a drop in gold overnite , clean out some stops and then higher.
beesting
Christopher # 33202 -From the Back of the Classroom.


<>

I had a long post worked out, that was lost due to a close lightning strike, but the action boiled down to this:

Thru the courts FREEZE the ASSETS of the United States Government, because of breach of contract.(Not using Gold or Silver as money!!!!
I know, I know, the consequences would have to be worked out. But it would be a bloodless revolution.....beesting.
Twice Discipled
Watch out for the stock exchange police!
For those of you who use online trading, the following is a snip-it from an amended agreement which the NASDAQ would require me to sign before my online broker would allow me to continue using their on-line trading facility.

"7. Subscriber will maintain such accurate and verifiable records regarding the use of the Information and including the number and location of all devices that receive the Information, as may be required, and will make these records available for a period of 3 years in a form acceptable to Nasdaq for inspection by Nasdaq's auditors upon reasonable notice. Subscriber shall make its premises available to Nasdaq for review of said records and for physical inspection of Vendor's Service and of Subscriber's use of the Information, all at reasonable times, upon reasonable notice, to ensure compliance with this Agreement."

I flat out told them that if I can't trade stocks without agreeing to allow someone to come in and search me house, I will sell all of my stocks!

Forget their schemes, buy gold! This really BURNS ME UP! Give up your freedoms so you can become "rich". NOT!!!
Twice Discipled
Golden Trip
Since I am posting, thought I would mention that I just got back from a trip to Alaska. Panned for gold along a river - what an experience and brought back a cup of "dirt" from the river bank to teach me daughter how to pan for gold. There must have been some awesome nuggets up there for people to have contributed up to 19 oz nuggets to the University of Alaska Museum.
What a beautiful state.
Journeyman
Who's responsible for the Modern American Mess? @Black Blade, silent runner, Christopher, ALL

Black Blade, who's responsible for the Modern American Mess is a
very difficult thing to untangle, at least it was for me. The
core insight necessary for me to get it straight as to who is to
blame came from Ed Crane & CATO Institute in a radio clip I just
happened to hear. Crane said that the "government" was separate
from the country and "the people."

Now I'd heard this in various ways for years -- I was involved
with the National LP organization for nearly a decade -- but I
hadn't "gotten" it till Crane's statement hit me just right.
That's when I realized that somehow "the government" is "them"
and the rest of the population is "us."

When people say "our government," I now regularly tell them, "It
may be YOUR government, but it's certainly not mine." Did that
make you bristle? Are you thinking, "That low-life Journeyman
isn't a patriotic American. If he doesn't love America, he should
leave it," or some such?

Until it becomes second nature to reject anyone or any phrase
grouping you with those comprising "the government," you're like
a pet dog that begs for his leash so he can be walked by his
master.

Later when someone corrects your usage of, "our government,"
you'll thank them for "correcting" you. Later, you'll start the
thankless task of correcting others. I remember how hard this
all is to understand and accept - - - which is a monument to the
effectiveness of the disinformation, statist mythology, and the
context we've been raised in. Perhaps the following links might
help:

http://www.webleyweb.com/tle/le960409.html
http://www.buildfreedom.com/tl/tl07g.shtml (Search for "Bateson"
and read from there on, although the whole thing is interesting.)

Once you accept that governments are not the benevolent despots
that public prevaricators such as Bill Clinton portray them as --
nor the harmless court jesters suggested by buffoons like Al
Gore, once you accept that governments are not good for you or
your loved ones or your friends and neighbors, that they are at
best, as George Washington described them, "a dangerous servant
and a fearful master," that because as New York surrogate judge
Tucker observed, "No mans life, liberty, or property are safe
while the legislature is in session," and thus that you must
always keep an eternally vigilant eye on them as the price of
your freedom, you can begin to be able to untangle who's
responsible for what goes on in any government-dominated society.
Eventually the implications of the following quote will come to
seem almost second nature --

"It must never be unpatriotic to support your country
against your government. It must always be unpatriotic
to support your government against your country."
-Stephen T. Byington, from "Lessons From Libertarian
Tax Protests" by Bob Bennett, LP News, Spring 1986

I would suggest until a person really "gets" this, they're not
likely to get their head straight about those "idiot" Americans
who have voted themselves Bill Clinton, etc.

The reason governments are so entrenched and "we the people" find
ourselves oppressed is not that we're idiots. A main reason is
that governments steal for a living. Stealing is a very efficient
way to get your "food." If you can do it successfully and with
little "overhead" in terms of human hours, if you can get your
victims to not only allow you to take it right out of their
paychecks, but also get them to spend irreplaceable hours of
their lives to do your bookkeeping for you by filling out 1040-
type forms - - - and even pay for the stamp to mail it to you - -
- you have plenty of spare time and resources to do all sorts of
mischief. You certainly have all sorts of time to perfect your
techniques of disinformation and solidify your position of
getting your "food" in this most wonderful of all ways.

And if you're a victim, how do you resist an enemy who steals
your "food" before you've even taken possession of it and then
uses it against you? How do you recognize an enemy that
constantly uses some of this food to bamboozle you into believing
that enemy is your friend? How do you recognize your predicament
when you've been conditioned in the enemies' schools since the
age of five?

Is it the fault of, in Black Blade's words, "a generally good and
generous people, [who] tend to believe in the best of people and
not the worst?" Or is it the fault of the occupying cliques that
subvert the rules, the money, and the communications media? Is
it "idiot" Americans (or British or Argentinians, etc)? Do we
have "ourselves" to blame? Or is it the (hierarchist) cliques
that steal their sustanance through extortion (by threat of gang
attacks and at the point of the IRS gun) even though many of us
good and generous people disapprove of the "mischief" they do
with what they steal?

Is the population at large responsible? The ones who vote? The
ones who don't? Or does the very act of voting play a pivotal
role?

As this theory [propounded by T. J. Lowi, in
'Incomplete Conquest: Governing America,' Holt,
Rinehart and Winston, 1981 -LRW] goes, participation is
an instrument of conquest because it encourages people
to give their consent to being governed by the state.
Stemming from a sense of fair play deeply embedded in
the human psyche, people generally obey the principle
that those who play the game accept the outcome. Those
who participate in politics are no less committed even
if they are consistently on the losing side. Therefore,
to no ones surprise, politicians plead with everyone to
get out and vote because voting is the simplest and
easiest form of participation by masses of people. Even
though it is minimal participation, it is sufficient to
commit all voters to being governed, regardless of who
wins.
+
This scheme of politics is remarkably ingenious in the
way it exploits the natural inclination of humans
toward fair play, loyalty and cooperation in process of
subjecting them to conquest. This kind of subjugation
of the masses is no recent discovery. Etienne de la
Boetie described this phenomenon as 'Voluntary
Servitude' over two hundred years ago, well before the
mystique of majority rule became the subliminal message
in sophisticated, saturation propaganda campaigns
instrumented by a mass communication media. -Alvin
Lowi, Jr. for Economic.net


A quick insight into "who's responsible" is easily available; Did
you choose "W" and/or Al Gore as the two "realistic" candidates
for head hoodlum - - - and the "best" this country has to offer?
I didn't think so.

Regards,
Journeyman

P.S. Christopher, you see much too clearly to keep sitting in the
back of the class.
TownCrier
ECB's President Duisenberg plays down the notion of European "new economy"
http://quote.bloomberg.com/pgcgi.cgi?T=markets_newsfeat99.ht=&ptitle=EMU%20Top%20Stories&touch=1&s=AOWNHoRUBRHVpc2VuSpeaking to the European Parliament, the ECB President said, "It is difficult as yet to find clear evidence of a new economy in the euro area," whereas on the other side of the big pond, last month Fed Chairman Alan Greenspan said the gains in U.S. productivity in recent years appear permanent.

President Duisenberg said the ECB must remain vigilant against inflation, and that such commitment to "nip inflationary pressures in the bud" was reflected in the five rate hikes within the past eight months.

While dismissing notions of a "new economy" in Europe, Duisenberg was nevertheless able to point to a promising economic outlook and real growth in the euro region, with each of the next two years seeing growth "considerably in excess of 3 percent." He said, "The best period that Europe has had in decades lies ahead of us, indeed we're in it."

If the U.S. economy is currently opperating within the glory of a "new paradigm" whereas Europe is only now starting to come up to speed, what are the prospects for future U.S. currency demand and external exchange rate strength, particularly when considering the massive U.S. trade deficit?
HI - HAT
Town Crier___________ "new economy"
The only thing new in the US "new economy", has been the magnatude and unprecedented length of the "binge".

The hallmarks of the mania will be debt piled on debt, bald naked hedonism, pschotic consumerism, gambling, deceipt, denial, hubris, laying down to a mad Federal power grab.

We now stand at the dawn of "settlement day". There will be no soft landing.

Either all the out of control debt-money creating entities keep pumping more and more, or the debt servicing structure will implode.

..............Liquidation or Serious Inflation.........

..................OR BOTH.............................
HI - HAT
Journeyman...msg.....33214 The Mess
No end In Sight ; Outcome Uncertain"They", must be deprived of MONEY. Tax Revolt is the only solution at this point.

Only when the backs are broken of the terrorist organizations IRS..BATF..DOJ..FBI...EXECUTIVE ORDERS..ETC.will reason and a Republic have a chance to flourish.

I beieve the Nation will transgress through a surrealistic nightmare before reason prevails, if ever.

Although corrupted Government is the snakes head, the Nation of common people bears all responsibility for its trek into the deep woods, where they now find themselves
LOST
Golden Truth
Gold up $281.41 on C.T.V News Net??????????
C.T.V NewsNet shows Gold is up $281.41 dollars.
Is this an error or the real thing, i'll let you all know. Now back to my T.V it's channel 52 here in Calgary,ALTA.
G.T
Golden Truth
GOLD NOT MOVING ON KITCO CHARTS??????
It's like GOLD has frozen and has stopped trading, could it be????? Is it true??

G.T
ORO
Aristotle - comments, installment 4
Debt money supply and demand - a balance

The effort to service debt is the sustenance of the purchasing power of a debt currency. While the dollar use within trade is simply as a medium of immediate exchange, this nanosecond of time in which a dollar is used is not where its nature shows. Where it shows is in the time between receipt and use - when it sits in your pocket, or in your account. Devaluation takes time and is thus not reflected in the moment of transaction.

The fact of use of a debt money as cash does not change its nature as a receipt for debt, nor does it change the fact that general price levels are determined by the balance of product (goods and services) supply and demand vs. monetary supply and demand. The demand for money to service debt and its supply by new debt issue balance out so that the residual of the balance is what matters for net supply and demand of currency.

This monetary supply and demand is one of the two determinants of a currency's purchasing power, and it seems to be the greater component.

If debt securities can be effectively used directly as money balances outside banks, then we can write up the general relationship:
Supply demand balance = Supply - Demand

Demand = IE * Debt(t)
Supply = DDebt = Debt(t) � Debt(t-1)

Where IE = effective average net interest on outstanding non-financial debt, which is not easy to determine. I like using a proxy for it in the form of the 6 month Eurodollar rate when using this measure with market statistics.

Dividing by the Debt(t) figure and defining a debt growth rate, DGR, as DDebt / Debt(t)
We get:
Balance = DGR - IE

For 1999, the balance comes to 7.1% - 5.44%, making for a +1.66% balance � meaning that there was monetary excess in the US.
Current expansion rates show excess demand of � % for May 2000. Particular periods of excess supply are late 1998, when the figure stood at a phenomenal 5.3% during the last quarter, and late 1999, when the figure was at 4.4% for the last quarter. Deflationary conditions were rather weak and far between, at some -3.3% in May 1999, and -2.6% in Feb 2000. This year was rather tight so far at 1%, but March was loose at 4.2%.

Similar calculations done on "Big Float" show a push and a pull for dollars in the global debt markets where dollar demand excesses are imported into the US about 3 months after they occur abroad. The current situation has been very deflationary in the foreign dollar markets since late 1997. The bursts of credit creation within the US were necessary to avoid further deterioration in dollar debt of foreigners fighting each other for dollars they need to pay back debt. The funds were exported through net US investments abroad and through the trade deficit. The demand for dollars for settlement of debt abroad sucked cash and reserves from the US out to the global markets. The dollar debtors had to export goods at reduced dollar prices in order to increase overall dollar volume of exports to the US, and were rewarded with just enough dollars to break even. The IMF supplied the balance.

The Saudi and other oil countries that accept dollars for oil exclusively have forced central banks to keep larger dollar reserves on hand as oil prices rise, the Saudi and UAE increases may be shots at the dollar; by inducing relief in the needs of growing countries to have their central banks continue accumulation of dollar reserves � not only to pay debt, but to pay for oil.

Europe needs $175 billion to buy 1 year's supply of oil at $30/bbl, less than $150 billion at $25/bbl.
Japan needs $68 billion at $30, $56 billion at $25.
China $51 and $43,
Korea $27 and $23,

The world outside the US needs $660 billion to buy 1 year's oil at $30, $550 billion at $25. The combined rise in oil consumption and price since the March 99 bottom at $10-$11 raised the 1 year reserve from just over $200 billion to $700 billion at the $32/bbl mark.

The rise in the price of oil into 1997 was part of the dollar liquidity pressure on the emerging nations. At the time, $27 oil and the requisite $500 billion 1 year reserve was more than the dollar indebted nations could bear. After some years of collecting reserves and delaying of oil consumption, the Newly Industrialized Countries are raising consumption and have the dollars to pay for some of it � at least for now.
TheStranger
Don Coxe Update
www.jonesheward.com/commentary.cfmJust incase no one has mentioned it yet, Don Coxe has a new conference call accessible at the above referenced link. If you have twenty minutes, tune him in for his bullish Euro, oil and gold arguments. Goldbugs will particularly like his answers to questions posed at the end of the presentation.

Thanks to Cavan Man for the heads up.
ORO
Cash currency circulation - a thought

The bulk of money is not in checkable or cash form - i.e. in the form used for commerce. Most money and money substitutes reside as time deposits and securities, and do not participate in the circulation of money through the economy. In the monetary aggregates, M1 and MZM are the relevant parts of the money supply available for clearing purchases. Of the portion that is money market accounts within MZM, the bulk of that sits in intermediate/short dated securities, not in cash equivalent form.

Banks themselves have moved to "sweep" cash balances into money market funds/accounts where the cash is capable of sustaining a larger "head" (as in head of beer) of debt securities that are earning interest. The result is that the monetary base -or cash base -needed to support the debt and the circulation of funds in the economy has fallen substantially. Even at the checkout counter, the prevalent and growing use of credit cards has made the cash for transaction execution available at the moment of transaction - created by the obligation of the consumer at the moment of transaction. At the end of the day, the credit card balances are transfered to the retailer's bank and settled with the banks issuing consumer credit. The banks then sell and buy debt securities in the quantities needed to settle the transactions on both sides. The credit card balances may be "securitized" and sold as a short dated security to a money market fund. The cash from the money market fund would be used to settle the retailer's receipts and the retailer's bank will deposit the cash balance in checking accounts, from which the bank will sweep funds into another (or the same) money market fund. The cash circulated twice and returned to the money market fund after raising its balance by that amount.

The same can be seen as we go down the supply chain. The retailer is usually given 30 day terms by its suppliers, so that the suppliers borrow the sum from their banks, sell the products and either sell the bank the receivables (retailer's receipts) or use the receivables as security for the loan. (This loan is necessary in order for the producer to make the products ordered by the retailer, where retailer's payment will be given 30 days after production, while the producer's bills must be partially paid as the products are manufactured). The working capital loans are settled by the retailer using his money market balances to deposit into the producer's checking account. The producer then pays off the loan. The producer's obligations were made during the period between the receipt of the order and the receipt of payment from the retailer - often at a 2 week + 1 month period. The producer took on obligations to his bank so he can fill the order, and paid workers and supliers with the borrowed funds. Thus money was created by the bank - backed by the producer's order and later by his receivables and the funds were deposited in worker's and supplier's accounts. The producer's bank will often trade the receivables loan by selling it or a mortgage contract to a money market fund or another bank, the cash would be used to settle with worker's and supplier's banks who will either buy securities with the funds or lend the cash to the producer's or retailer's bank. Here again, the cash circulates twice during the period between order and payment. The use of credit rather than cash for payments doubles the circulation of cash but still results in a round trip from money market and bank accounts back into those same funds and banks. Title to the cash changes hands, but its location stays about the same.

Duisenberg described the resulting condition where cash is circulating in volumes so great that the whole of a bank's net capital is circulated daily. Banks are now only 1/4 of the US debt market. Securities backing money market accounts and held by pension funds and foreigners are now the bulk of debt. The mortgage securitization companies (which are GSEs) and the other securitizers (GMAC, GE commercial credit etc.) are more efficient than the banks themselves, and once semi-cash status was granted the money market funds balances other security accounts can be made to behave in similar fashion. Holders of equity and debt funds can move balances between them and money market accounts with no transaction costs - as they do with bank savings accounts and CDs. With the provision of automated transfer services and automated diversification services by some fund families, brokers and the new "Folio" service, the practical use of stocks and bonds as money balances is now possible with better convenience than that of bank accounts.

The bank's functions are receding to become cash settlement and derivatives originators. The derivatives are more credible when issued by a bank than by Joe Anyone because banks have the guarantee of the central bank for their liabilities, which reduces counterparty risk and makes them the preferred counterparty.

wolavka
Fit the news story to the techs
time running out on china and taiwan:

Golds excuse to move higher, no it's on the charts.

View Yesterday's Discussion.

Black Blade
Morning Wakeup Call!
Source: Bridge NewsAsia Precious Metals Review: Gold underpinned after overnight dip
By Hiroyuki Fujiwara, BridgeNews

Tokyo--July 6--Light buying underpinned spot gold below U.S. $284 per ounce Thursday in Asia after an overnight slip, but a lack of follow-through buying prevented prices from steady recovery, dealers said. Bargain-hunting supported platinum after overnight declines, they added. Local buying was too weak to lift gold prices, the dealers said. Players are hesitant to buy gold toward the next U.K. Treasury's auction scheduled Wednesday, they said. Spot gold prices remained bound in a range between $283 and $285 during Asia trading hours. Market sentiment remained relatively weak, dealers noted. Meanwhile, Australian gold producers stood on sidelines Thursday in a sluggish market. Overnight news that Russia's Norilsk Nickel would start selling platinum to Japan in a few weeks discouraged speculators on the Tokyo Commodity Exchange early in the morning after tumbled NYMEX, the dealers said. However, bargain hunters prevented TOCOM platinum futures from declining further amid the steady U.S. dollar/yen, while a price rebound triggered short-covering in the afternoon, they said. Russia related news do little to cause panic in the Japanese market, the dealers said. Japanese buyers have not confirmed the progress of 2000 long-term trade talks with Russia. The dealers said few players are willing to sell platinum as stronger demand is expected to support prices in the long term. Most TOCOM platinum futures eventually closed firmer from Wednesday and this supported spot platinum prices late afternoon, they said.

Black Blade: Ho hum.

Europe gold trading sideways, complex steady

LONDON, July 6 (Reuters) - Precious metals markets were mostly quiet during Thursday's early European session, with gold seen trading sideways ahead of next week's Bank of England bullion auction. ``The medium- and long-term bull scenario remains intact but the short-term picture seems slightly less positive as the Bank of England auction next week will possibly weigh on any short-term price recovery,'' said Frederic Panizzutti at MKS Finance in Geneva. ``Still, the weaker price level should provide a sharp physical demand increase, preventing gold from declining below its $283.00 support and eventually motivate a correction higher over $285.00 again,'' he added. Although not for another five working days, the market has little fresh news to give it impetus, so traders said the upcoming 25-tonne sale was becoming the focus. ``I think we'll probably stay in the recent $282-$292 range until then,'' said one trader. Gold has trended lower within a narrow range all week as speculative funds have liquidated some long positions and the lull of the
summer season was slowly becoming a reality. Dollar strength and oil price weakness also prompted some overnight selling in Asian markets. ``Gold is expected to consolidate above $284 today, trading with a slight bias to the upside,'' said another London-based trader. At 1015 GMT spot gold was at $284.90/$285.40, up from New York's close at 283.90/$284.40. Silver has gradually been giving up recent small gains and was looking unimpressive again on Thursday. It was last quoted unchanged at $4.97/$4.99. Platinum and palladium have both seen heavy selling on signs that the acute shortage of the metals may soon be alleviated,following a move by Russian metals giant Norilsk Nickel to order its agent Almaz to sign sales contracts for the PGMs with its Japanese customers. After long liquidation pulled the price down yesterday, it was seen consolidating, last at $532.00/$540.00 from $532.00/$542.00. Palladium was also little changed, last at $620.00/$630.00 from $618.00/$628.00.

Black Blade: Ho Hum. At least Au is slowly clawing its way back in overnight trading. Notice that hedged (Gold short-sellers) like Barrick (ABX) have some down-side protection as they did not fall as hard as unhedged producers (long positioned players) like Harmony (HGMCY). That is to be expected as short-sellers do well in declining markets. However, in a rising market, shorts like ABX have little/limited upside potential in comparison to unhedged producers as evidenced by their lack of volatility in the recent up/down gold market action. How many more Ashanti's and Cambior's await when POG ultimately rises?

Meanwhile, Some rational thinking is coming back into the market today. As Warren Buffet talks about Mr. Market being a manic depressive. At times he's in a panic, and at other times he's irrationally enthusiastic. We sure saw Mr. Market at his finest yesterday ;-)

S&P Futures are up +2.70, fair value positive at +3.67 indicating a slightly positive open on Wall Street at these levels. Au is up +$0.30 at $283.50 slowly rebounding after yesterday's carnage, Ag is unchanged at $4.96, Pt up +$6.00 at $552.00, and Pd is up +3.00 at $620.00. Traders are beginning to realize that rumor of Russian PGM sales have come and gone several times over the last year or so, even unconfirmed sightings of the elusive metals on occasion. This time should be no different. And oil, look at oil! Up +$0.63 at $31.30/bbl. It should continue to rise. The refining capacity is still at around 95%, additional supplies will only bottle-neck in the storage yards. Add to this that there is increasing opposition to Saudis plans from other OPEC members. Venezuela (US chief OPEC supplier) is very vocal this morning, also other players in OPEC have voiced their disapproval. This morning reports of a DOE sponsored study indicating the likely-hood of rolling brown-outs and black-outs this summer due to problems with the nation's power grid, etc. I will try to locate and post if available.

aircrew
Journeyman (07/05/00; 17:24:29MT - usagold.com msg#: 33214)
Given that I will most likely never see my choice of head hooligan, how does one go about daily (and especially annual April 15) life without ending up at the wrong end of the various agencies guns or administrative hearings?
SHIFTY
WHO ?
Just wondering: WHO is supposed to be watching the markets for unfair trade practices, and price fixing?
I think we need to make sure that this individual is put on notice that ( He/She) will be held accountable, and considered an accessory if they fail to bring a stop to the actions of certain market players. I know I would like to send this person an e-mail!
USAGOLD
Today's Market Report: Gold, Oil Rebound
http://www.usagold.com/Order_Form.html7/6/00 Indications
�Current
�Change
Gold August Comex
286.00
+0.70
Silver July Comex
5.06
+0.02
30 Yr TBond Sept CBOT
97~04
-0~19
Dollar Index June NYBOT
106.80
nc


Market Report (7/6/00) Gold scrambled back to its feet in the early going today trading as much
as $1.80 higher with oil jumping as well (+ 33�) and the currencies mixed (euro up, yen down).
Just as we alluded to yesterday, the Saudi plan to pump more oil has run into opposition from
fellow OPEC members, so it appears for the moment at least that all bets are off as angry and
stunned OPEC members try to decide what they are going to do next. As we said yesterday, good
news turns to bad with alarming speed these days. As it is, Al Gore will have to find something
else to drain attention away from his fund-raising scandals and the gold market can think about
resuming the trend that took it over the $290 mark last week. Maybe that dominant long position
among large speculators is for real after all. The Bank of England auction is scheduled for next
week, and any strong increase in the price would be contrary to market action in the past just
before one of these sales. Europe trade was quiet. Reuters quotes MKS/Geneva's Frederich
Panizutti as saying: "The medium- and long-term bull scenario remains intact but the short-term
picture seems slightly less positive as the Bank of England auction next week will possibly weigh
on any short-term price recovery." Asian trade was characterized as firm. It seems for whatever
reason the Australian producers are temporarily on the sidelines.

Echoing warnings read here on several occasions over the past several months, the Commodity
Futures' Trading Commission issued a consumer alert on leveraged gold trading yesterday after
taking action against two leverage gold brokers for fraudulent activity. As we have said time and
again, the best gold is the stuff bought, paid for and sitting in your safe deposit box. A very high
percentage of Centennial Precious Metals/USAGOLD's clientele owns gold not to make a profit
(though they wouldn't turn it down) but to insure their portfolio against economic systemic risks --
including inflation, deflation, a banking crisis, a Wall Street Crash, derivative meltdown etc.
Borrowing to purchase gold is not our idea of gold ownership and the CFTC crackdown tells the
reasons why. If you are already in a leverage contract, you might try to get out. If you aren't,
don't get sucked in. The firms against which action was taken were all charged with fraudulently
misleading investors about the profit potential and playing down the risks (which are abundant in
leveraged purchases.) Be forewarned.

Those wondering why Treasuries weakened almost a point over the past two sessions might want
to watch for tomorrow's employment report expected to show a rebound.

That's if for today,fellow goldmeisters. Have a good day and we will see you back here
tomorrow.

An Invitation:

I would like to invite those who take an interest in the type of analysis read here to give our
newsletter a try -- News & Views: Forecasts, Commentary & Analysis on the
Economy and Precious Metals. This month we focus on oil and inflation. Many analysts and
investors think there very well may have been a fundamental shift in economy that could favor the
gold market and hammer the equities and dollar market. These opinions from various sources are
covered in some detail in the upcoming July issue. Along with the latest issue of News & Views,
you will receive our Gold Almanac 2000 which offers fundamental background on the yellow
metal. The theme of this year's Almanac is wealth preservation and one of the key articles is
how those in the 1970s -- a decade many are comparing to the present -- not only survived double
digit inflation, but prospered. The package is offered at no cost or obligation. You can call
Marie at 1-800-869-5115 to request the newsletter and Almanac or click above.
Leland
The World Gold Council Receives lots of Flack...This Time They Deserve lots of Credit...
CoBra(too)
EU, Euro, Gold ....
Hello everybody,

I'm back for a while.

As the gold market is remaining range bound and is not allowed to breach 290$/oz for the time-being - except for
rolling forward the shorts - even "positive for gold" remarks by Herve Ferhani (BoF) and Peter Zoellner (BoA-ustria - gold sellers -though mostly to the Austrian Mint)at the FT Gold Conference in Paris,where the consensus among participants was positive for a breakout during summer, the question remains - what's going to trigger higher physical prices? ... in view of unlimited (or is it?)paper supply.

In the meantime no further interest rate hikes in the EU, including UK - where the next gold give away is taking place on July 12. - and who's going to join the Euro or the EU, as such, next is the question. A question revolving around a EU of a new gravitational center made up of France and Germany, or as Chirac put it a Europe of two speeds or paces. Spare me Mr. Chirac (Jospin) and Schroeder and try to refocus on the real goals of a unified (probably not united)15, doubling to 28 or 30 over time - and please also try to correct the stupidity of the sanctions against Austria. - The following is a qoute from Bob Chapman's International Forecaster:
" The EU has painted itself into a corner over Austrian Sanctions.
Austria's 14 EU partners hve refused bilateral contact because Austrian citizens refused to elect the only acceptable political result and that was the election of socialists and communists. The coalition of the conservative People's Party (VP) is doing very well and hs gained enormous strenght. Yet the sanctions continue to deprive the Austrians of the democratic right to choose their representatives. This very collective act solidly questions the democratic legitimacy of these 14 EU members, who now lead a totalitarian coalition. these sabctions are illegal and tantamount to an act of war. They are an unilateral act, wjhich may have led to a major European war before WWII. 88% of Austrians oppose the sanctions, the other 12% we suppose are in mental institutions."
I can't agree more and with France now`presiding the EU -
and stating the sanctions probably won't be lifted during their term, providing a monitoring by 3 wise men, named by
Luzius Willhaber, the Swiss President of the European Court for Human Rights, doesn't come to positive jurisdiction about Austria's observance of the (obscure) European Values and the nature of the FP (Freedom Party). What a waste of time and what's more a waste of trust in the wisdom of the leaders of a unified Europe. A host of smaller member countries are beginning to question the reform of EU institutions and more. IMHO - the damage has been done and outlawed Austria is free to do as it pleases. Thank you Chirac,Jospin, Moscovici Michel, Guterres and co. to show us our place in the EU - at least we'll resort to a (problematic) referendum - just what we all needed, merci, as Denmark's referundum to join the Euro and UK's ambitions are at stake!

I'll settle for gold - regards CB2




Leland
From BritAl (Jul.06, 14:53) at GOLD-EAGLE -- Just Fun...He's Predicting the Rest of Year 2000
1. Despite oil rising to over $40 a barrel, the CPI
figures fall for the 6th straight month. When asked to
explain the suspicious looking figure, the new Fed
spokesman �David Copperfield� assures everyone that
everything is in order.

2. Gold drops to $200 oz. on concerted short selling
from Goldman Sachs and JP Morgan who now have more
contracts outstanding than there is sand in the Sahara.
When asked to investigate, Comex accept their
explanation that as the moon is not made of cheese it's
probably made of Gold. The spot price falls $20 on the
news there may be Gold in space.

3. The US threaten Cuba with sanctions after the latest
advertising campaign for Havanna Cigars features a
poster of Bill Clinton and Monica Lewinsky.

4. The price of livestock and crops fall to new lows on
options selling, making it no longer economic to farm.
The whole midwest become daytraders and Oprah hosts a
show called �Why eating is bad for you�. The Jerry
Springer show �I'm cheating on my Broker with an online
Trader� creates a stir when one of the guests mentions
buying a gold share with their welfare cheque. The show
is pulled.

5. When a congressional investigation, prompted by GATA,
fails to find any Gold in Fort Knox, the Fed spokesman
�David Copperfield� explains it away as just an
illusion. Gold drops $10 on the news.

6. When Gold spikes up by 50c, the Vatican announces it
has been extremely unchristian hoarding all this wealth
for the past few centuries and pledges to give its Gold
to the �poor and the needy�. The �poor and the needy�
turn out to be Goldman Sachs and JP Morgan. Gold drops
$10 on the news.

7. Doubts about Presidential candidate Al Gore surface,
after he claims not only have invented the internet but
also the �Internal Combustion Engine�.

8. As the stockmarket rise starts to flag, CNBC and
Pokemon announce a tie in with Wall Street with the
slogan �Gotta Buy �Em all�. Despite every Dow stock
being 50% off its highs, the DJ Index is at record
highs.

9. DROOY is now only 10c a share but a poster on
Gold-Eagle manages to prove that it now has such
enormous leverage to the price of Gold that a $1 spot
rise would cause the Co. to be valued at more than
Microsoft, IBM and Cisco together (about 20c).

10. Eventually Wall Street crashes and falls from 15,000
to 14,000. Ben takes the credit and claims his models
told him all along.
Goldfly
Hey CB2!
Glad to see you're around. You mean the EC and Austria are still going through all that? Man I've been out of touch....

I suppose Austria is fairly self-sufficient, but what a pain. If Ronald Reagan were in office he would probably start an airlift to your land-locked country. I can see it now:

"Mr. Chirac (or whoever the Frenchie is in charge of the EU now) tear down this wall!"

Best regards

gf
Journeyman
It's revolutionary! @aircrew, HI - HAT, beesting, Christopher, ALL

"'They', must be deprived of MONEY. Tax Revolt is the only
solution at this point." -HI - HAT (07/05/00; 19:05:39MT
- usagold.com msg#: 33217)

"Thru the courts FREEZE the ASSETS of the United States Government, because of breach of contract. (Not using Gold or Silver as money!!!!) I know, I know, the consequences would have to be worked out. But it would be a bloodless revolution." -beesting (07/05/00; 17:06:48MT - usagold.com msg#: 33211)

"Given that I will most likely never see my choice of head
hooligan, how does one go about daily (and especially annual
April 15) life without ending up at the wrong end of the
various agencies guns or administrative hearings?" -aircrew
(07/06/00; 08:26:34MT - usagold.com msg#: 33225)

Given the above comments, the recent celebration (2 days ago) of the American PEOPLE'S day of independence from repressive government, Christopher's highly insightful "musings from the back of the classroom" [Christopher # 33202] including, he says, "conclusions which flitter about inside my head, just out of reach of the light, but close enough to send shivers down my spine when their shadows brush by me and the truth they contain presents itself," seem quite appropriate. In particular:

"This site is primarily a Gold discussion forum, but on its
edges these topics of freedom and patriotism are always
alluded to and seem to go hand in hand in the underlying
currents of discussion. The Ladies and Gentlemen that speak
so knowledgably about the former, also espouse the latter
in their words whether consciously or not, I do not know,
but it is there for all to see. Gold and Freedom are
inseparable." -Christopher # 33202

<> -beesting

In partial answer to aircrew or anyone else who is inclined to free themselves from one of the more onorous manifestations of government, may I suggest a reading of the following couple of messages from the archives [accessible by clicking on the (Forum Archive) button in the header to this page]:

(05/15/00; 15:59:02MT - usagold.com msg#: 30575)
(4/27/2000; 9:39:57MT - usagold.com msg#: 29427)

Regards,
Journeyman
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 3, 2000

Rates for Friday, June 30, 2000

Federal funds 6.86

Treasury constant maturities:
3-month 5.88
10-year 6.03
20-year 6.26
30-year 5.90

upside-down spread FF vs long bond = (.96%)
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 5, 2000

Rates for Monday, July 3, 2000

Federal funds 7.03

Treasury constant maturities:
3-month 6.00
10-year 6.00
20-year 6.22
30-year 5.87

upside-down spread FF vs long bond = (1.16%)
Hill Billy Mitchell
Official release

Official: Federal Reserve Statistical Release

Release Date: July 6, 2000

Rates for Wednesday, July 5, 2000

Federal funds 6.52

Treasury constant maturities:
3-month 5.99
10-year 5.99
20-year 6.21
30-year 5.86

upside-down spread FF vs long bond = (0.66%)
wolavka
comex floor
okay the jokes over, we know the range in dec gold is 295 to 288 but if you chose to pull the stops back to 282.00 we all will watch till you trade it down there and then buy in.

First part of next week you won't find any sellers. Games over clowns.
SHIFTY
Kidnapped ???
Where the heck is everyone?

Has the anti-gold mob kidnapped all the great minds at USAGOLD ?
If so then I guess it pays to sit in the back of the class. :)
At least if there is a ransom, it won't be some barbarous relic, that's hard to find!
They will most likely want some form of paper. I had better call my local print shop and tell them to be ready, I may need to place a large order!!

$hifty
SHIFTY
(No Subject)
Just thinking : 40 federal reserve notes weigh about 1 oz ( shifty's postal scale )
So if I divide the POG, now $283.25 by 40 = $7.08
This would mean that the federal reserve notes with a face value over $7.08 on them are worth more than there weight in gold.!

I better go to bed.
Good Night
$
Leland
"And, The Band Plays On...."
For a Small Number, It's Time to Live Large

By Sharon Walsh
Washington Post Staff Writer
Friday , July 7, 2000 ; E01

NEW YORK �� Leasing spectacular crewed yachts to the very rich at an average price of $40,000
a week has proved to be an excellent venture for Paul Madden. Yachtstore Ltd., his online business,
has grown steadily in the past five years. But nothing quite prepared him for this year: Orders for
charters are up 400 percent.

"There's been a big spurt this year," Madden said from his New Canaan, Conn., offices. "Internet
money has been very good to us. And the Microsoft executives and the tech establishment. . . ."

Patek Philippe, the Swiss watchmaker known mostly for men's watches that cost tens of thousands
of dollars, recently introduced a new ladies' bracelet watch called the Twenty-4 for $6,250. The
style immediately sold out in the United States, and 2,000 orders are waiting to be filled.

At the same time, there are several hundred back orders for one of the company's men's watches, a
gold bracelet annual calendar watch that sells for $26,500. In both cases, Patek Philippe hopes to
be able to fill half of the orders this year.

"We've never gotten that many orders before," said Tania Edwards, a spokeswoman for Patek
Philippe in the United States. "It's unbelievable, unheard of."

After a period of phenomenal economic growth, consumer spending in many areas has slowed as
investors watched interest rates rise and their worth on paper decline along with the stock market
over the past six months. Retail sales fell slightly in April and May, while overall consumer spending
increased somewhat. But one segment of the economy that is still on fire is luxury goods.

While there are no hard statistics on luxury buying--the government doesn't break its figures down
that way--economists who follow consumer trends say the wave of luxury consumerism is stronger
now than ever.

"The people who are buying luxuries have had the biggest gains," said Jason Trennert, managing
director and economist at International Strategy & Investment, a brokerage firm specializing in
economic research. "The wealthy are still ridiculously wealthy."

The value of stock holdings in this country nearly doubled last year, going from $3.8 trillion to $7.4
trillion, according to a Harvard University report. But even though nearly half of American families
now own some form of common stock, 37 percent of the stock wealth is held by the top 1 percent
of shareholders, according to the study--meaning the rich, as the saying goes, are getting richer.

Certainly, despite the delivery of pink slips in certain Silicon Valley companies, the spending by
newly wealthy high-tech entrepreneurs continues to surge.

Eric Mendell, one of the owners of Kern's of Burlingame--a jeweler with an enviable location 17
miles south of San Francisco and 20 miles north of Silicon Valley--has benefited from the urge to
own luxury items.

"Sometimes people come in, they've worked their fannies off for several years and then everything
happens overnight," Mendell said. "Their stock just went public. They see it, they like it, they want it,
they buy it. They don't even ask the price."

One Silicon Valley winner came in one day, ordered several Patek Philippe watches in platinum and
asked that he be notified when they arrived. Without asking the price, he left the store, having
ordered watches worth more than $200,000.

When Rolls-Royce Motor Cars of America launched its most expensive car ever recently, the
$360,000 Corniche convertible, some auto critics called it strictly an image car. It is beautiful, they
said, but functionally not better than, say, a Honda Accord.

Yet, when the company allotted 107 of the cars to the American market, they had no idea it would
sell them all.

For those not quite up to a Rolls, there is the $80,000 Jaguar XKR. Ford Motor Co. recently
announced a record 80 percent sales growth in sales of Jaguars--to 40,000 cars--in the first five
months of 2000.

As the wealth effect--the impact of having more money, if not in your pocket at least on paper--has
gripped the nation, the idea of keeping up with the Joneses has become more akin to keeping up
with the Rockefellers.

The things that once conferred prestige--big houses, expensive cars, swimming pools, jewels--now
appear to be within the reach of many consumers. Cell phones, computers, big-screen TVs and
portable CD players, once considered items for the elite, are now thought to be necessities. To stand
out from the pack, the luxury must be bigger, better and more expensive. Most of all, it must be
unique.

One of the most unmistakable ways to prove your wealth is to wear it. And jewelers are benefiting.

At New York's Harry Winston, sales of rare pieces of jewelry are up "aggressively" over last year,
according to spokesman Jim Haag, though Winston doesn't divulge sales figures.

"In the '80s, it was more follow the leader," Haag said. "Now, people at the upper end want
something unique and rare that no one else has."

Rings, particularly with yellow or other colored diamonds, are quite popular. As are the extra-large
Tahitian pearls. Rings between seven and 20 carats are in demand.

"Everybody wants 10-carat emerald-cut diamonds," which can cost between $250,000 and
$750,000 depending on the quality, Haag said.

Renee Lewis, a New York jewelry designer, takes old jewelry apart and resets the stones, creating
one-of-a-kind pieces that sell for $2,000 to $60,000 in stores such as Barneys New York and
Bergdorf Goodman.

"I'm having a hell of a year," Lewis said, adding that she works seven days a week to keep up with
the demand for the uncommon pieces. "It's the best year ever and I haven't seen any signs of a
slowdown."

The longing for something exclusive has also meant new opportunities for architects and interior
designers as the wealthy try to make their homes distinctive.

"People who have real money--beyond $1 million or $2 million--want something unique," said Jean
Verbridge, an interior designer with Siemasko & Verbridge in Beverly, Mass., who works with
clients in and around Boston.

Custom-made furniture, sculpture commissioned for a specific house, a limited-edition Steinway
piano with the cabinet made by furniture designer Dakota Jackson--are all items that qualify as
luxury status symbols for the wealthy these days, Verbridge said.

Then there was the client who saw a leather-lined room in Italy and wanted one. So Siemasko &
Verbridge produced a small, windowed room with leather walls and floors.

"It's the notion of people asking 'Wherever did you get that?' and knowing that no one else can have
it," said Verbridge. "If everybody can have Calvin Klein, who would want it?" she asked. "You can
buy it at K-Mart."

There is, of course, a dark side to this luxury spending boom.

In September, for the first time in decades, U.S. consumers, highly confident that there was no end in
sight to their good fortune, began spending more than they earn, according to the Commerce
Department, meaning that the national savings rate is at record lows of less than 1 percent. The
proportion of families whose debt exceeds 40 percent of their income rose to 12.7 percent in the
past three years, according to the Federal Reserve's triennial report on wealth. And more than 1.3
million Americans filed for bankruptcy last year.

Even those who earn what might be considered a good deal of money frequently live beyond their
means.

Manhattan psychologist Marlin Potash said she often sees people who are lawyers, doctors or Wall
Street professionals spending more than they can afford in order to keep up with a standard of living
they feel is expected of them.

"People are spending more than they're making and saving nothing," she said. "They choose to live in
a way they're uncomfortable with psychologically, but they have lots of luxuries."

The amount of money made and spent by the top tier of America's haves also drives up the cost of
both necessities and luxuries for the middle class. In Manhattan, demand for luxury apartments has
sent developers into a renovation frenzy, with old buildings being gutted and improved for
multimillion-dollar co-ops that include ballrooms and concierge service.

Meanwhile, the average cost of an apartment in New York City jumped by nearly a third over the
past year, breaking the $700,000 mark for the first time.

Even a meal out can be a luxury. French chef Alain Ducasse recently opened what is believed to be
the most expensive restaurant in New York at the Essex House. The prix fixe dinner with foie gras,
sweetbreads and gelee of frog's legs is $160 per person, without wine or drinks. The wait for a
table: 8 1/2 months.

Perhaps the universally recognized luxury purchase is the yacht, all over the world considered the
ultimate sign of affluence. And yacht builders and charterers are filling the need.

"This economy has afforded people an opportunity to pursue their dreams," said Marnie Wright,
director of communications for the Hinckley Co., a Southwest Harbor, Maine, yacht builder.

Right now, the company's most popular boat is the picnic boat, well, a yacht really. The 36-foot
open day boat has a price tag of $400,000 and a waiting list of eight months.

One of its attractions is that it has a draft of only 18 inches, which allows people who live on the
water to get in and out of shallow areas. And it has a navigation system that makes it accessible to
people who haven't captained boats before.

"We're seeing lots of first-time boat owners, people who've done well but never owned a boat
before," she said. They can learn to drive the boat in just a day.

If you've been even more successful and already know how to captain a boat, perhaps the
company's Talaria 44 Jet is for you. The boat, priced at a little over $1 million, has an 18-month
waiting list.

Or, if you want a boat for only a week or so, there are the 250 or so luxurious private yachts with
full crews offered for lease by the Yachtstore.

One of the most popular is a 189-foot yacht in the Mediterranean with a crew of 16 including a chef
(nearly always the most important crew member, according to Madden), stewards, stewardesses, a
captain, three musicians, a hair stylist and a personal trainer.

The yacht takes 18 passengers and costs about $250,000 a week, Madden said.

Madden's biggest problem right now, he said, is finding enough boats to fulfill all the orders, which
can come from unexpected clients.

In one case, Madden called a customer who had chartered a yacht for more than $100,000 a week
and was told that he wasn't home from school yet. Thinking that the 14-year-old who made the
reservation through the Internet was playing a joke on him, Madden spoke with the boy's father.

"He said that absolutely he would write the check, but it was his son's job to find the charter," said
Madden, who noted that he has dealt with children on several occasions because his service is
offered on the Internet and kids often are better at navigating computers than their parents.

Madden hopes this is a sign that his business will do well in the next generation.

"I'm hopeful that he'll grow up and write his own checks," Madden said.

(Fair Use For Educational/Research Purposes Only.)View Yesterday's Discussion.

Aristotle
My chats with ORO
Having had a lot of dialog with you, ORO, which for the sake of making progress it always made the most sense to dwell on our differences of perception, I thought it would be a good change of pace to emphasize our common ground as taken from your series of posts directed my way beginning Sunday. And while I'm not going to repeat all of the points on which we agree, what I'll do with this post is repeat some of those of particularly worthy points, and throw in an occasional comment of my own too elaborate where it seems fitting to do so. [[My comments will be contained in brackets.]] Everything else from the end of this sentence will be excerpts of ORO's past four posts to me.
-------------------------
ORO: The boom and bust cycles of monetary inflation, at first at the credit level and then at the monetary base level are well known and innate features of debt money. They parallel the gold debt boom and bust cycles that central banks introduced.

Ari: [[Banking at ANY scale introduced this phenomenon, it's just that bankiing organization, particularly with central banks, increased the observable scale of the boom and bust. But in truth, even without such organization, to an individual with his "savings" on deposit at any one of the individual banks that failed from a bank run, the "small scale bust" of the bankruptcy is profoundly traumatic and ill-tolerated. It's proven impossible to keep legislators from meddling in such affairs to "mend the problem."]]

The indirect gold backing of the dollar that FOA and ANOTHER imply and I think exists, is going to collapse in a deflationary manner in the paper gold market, and in a stagflation/hyperinflationary manner in the dollar that has been hitched to gold in paper form.

[[The various Gold contracts of today are very much like floating versions of the formerly fixed Gold contracts known as Dollars and the other convertible currencies under the old banking Gold Standard which tended to implode nation by nation. The currency/contract failed but the Gold prevailed. As we now have it today, the bullion banking system is organized worldwide, which means the scale of the coming contract failure will be unprecedented. The run on Gold will be global, and glorious--if you already have Gold, that is.]]

The derivatives of gold do not CREATE the current demand for gold but serve to displace it and dilute its value as they are CREATED to fill the demand.

[[You said it, Brother.]]

The funny money systems can survive through periods of 100% annual price inflations - these survival mechanisms are built around indexing to prices [...] The growth of such systems in inflation-prone countries removed the benefit to government and banking of inflating the money supply as people form a habit of carrying nominally-calculated debt and indexed assets. The people competed with government as to how quickly they spend the funds they don't have yet. The people won the race. Sounds wierd, but that has been my personal experience in such periods.

[[That's what I meant by any given system being "workable" after one fashion or another.]]

While wide popular understanding of what is happening in the currency valuation dynamics of nations with a heavy inflationary tendency does improve substantially, it does not mean that alternatives are understood, nor is it understood that the lack of wild devaluation of paper money purchasing power at one point in time serves as a predictor of it happening later.

[[That's why better monetary education is needed--perhaps exactly what the Bundesbank has in mind with the launch of their Gold mark coin program scheduled for next year.]]

The dismissal of gold and free banking as a monetary system is often used as to avoid having to discuss its workings, which are self correcting.

[[As I cautioned earlier, while this system should be self-correcting, history proves that it is impossible to keep the legislators from meddling to cure their constituents' individual pains when exposed to intermittant bank failures. This continues to be the biggest practical obsticle you must overcome in "selling" your program. It's been tried, and it couldn't survive the benevolent/malevolent (your choice) hand of man.]]

Paper debt money is capable of smoothing out ripples inherent in banking, but only at the expense of creating enormous imbalances that later induce collapse.

[[Bingo. We save with Gold today as our refuge against the coming mother of all collapses as alluded to earlier.]]

Savings are not investment. [[More properly]] savings [[are nicely defined as]] a non-entrepreneurial allocation [[or procurement]] of resources

In a paper money system savings can not be had at all, unless done in the form of goods purchased for later consumption and stored within reach.

[[Hopefully more and more people come to see this important point being made here with these several following points. As I also stressed in my July 4th post, paper currency is a fine tool for commerce, but it is absolutely unsuited for use as savings. ORO explains why as follows--]]

Banks, being entrepreneurial, invest the deposits (in gold banking with a central bank) entrepreneurially while diluting [[currency or]] gold values with derivative substitutes. [...] The savings that people hold at banks are not treated [[more clearly, they are not perceived]] by them as investments, but that is what they are. They contain risks of default on top of the risk (rather than calling it risk we should call it certainty) of depreciation of fiduciary media.

[[The following is a good recapitulation of the above points!]]
Bonds and savings are contradictory terms. So are modern "savings accounts." One does not save promises, one saves assets; land, gold, housing, collectibles, equipment. The bulk of bank accounts are viewed by the depositors as savings, while treated by the banks as investments. The main tool of savings in the past, were gold and silver. The displacement of these with paper promises causes dilution during the long periods of monetary expansion

Investment is not savings. Investment is the putting of resources at risk for the prospect of future reward. By eliminating gold and silver as apparently effective means for savings (by the dillutive effects of paper versions of them), all people are forced [["inspired" or "inclined" is a better term]] to invest by putting their funds in a bank account and having banks invest the funds in a portfolio of loans. Alternatively, savers can put funds in government and other bonds. None of these solutions are true replacements of savings, since all are investments.

[[Too few "Westerners" with a history of relatively stable currency and inflation realize this vital distinction between savings and investment.]]

So far, no monetary system other than straight precious metal accompanied by free banking (or without any banking at all) [["no banking" implies FreeGold]] has ever survived more than 25 years without going through a deflationary or inflationary crisis. The period just before the system crumbles is usually one of high speed prosperity and of high rates of debt accumulation. The fact of apparent prosperity is not an indication of future conditions. Your exasperation, shared by may gold bugs, is to be expected, but is still misplaced.

[[We must have miscommunicated here, ORO. I am not exasperated. Quite the contrary. I understand what's happening, and therefore I'm LOVIN' IT--continuing to acquire physical Gold at these gift prices with all excess funds.]]

The central bank may attempt to slow the rate of damage and extend the "reckoning" to a later date, however, it has not the option of avoiding the damage, nor of preventing the "reckoning" at the end of the process. Failure of debt money systems is structurally assured, what remains uncertain are the timing, the rate of change, and the ultimate degree of damage.

The "near end" in the 70s was not quite as intense a crisis as it had potential to become because of the support granted the dollar on international markets by the central banks of nearly all nations [...] Today, international support on this scale is not available. Like the man at the grocer's who has accumulated too high a credit balance and is asked to pay in cash. "You are my best customer, but you pay off such a small portion of your outstanding bill that keeping your custom is just not enough of a reason to accept your credit. I would do just as well if I closed shop and we were both ruined- because I can't afford you, and you can't afford yourself."

The distortion is maintained through the dollar debt balance of foreign countries and corporations in what can be described as a short squeeze. The EU and Japan suck dollars out of the international markets and into their reserves, and cause the dollar to be bid up in the Newly Industrialized Nations, who now must sell more product and import less in order to service the same debt.

[[And importantly, as ORO said moments ago, "Today, international support on this scale is not available." Therefore, say goodbye to the old life-support system for the internationally strong U.S. Dollar.]]

At this point, without looking at later consequences and without viewing the details of how this is done, I can more than agree with you, Aristotle, we not only have a workable system for ourselves, but perhaps the BEST possible system FOR US � if we can make it last.

[[Again, I wonder if we miscommunicated here. My suggestions of debt-based currencies as "workable systems" were made with the euro system uppermost in mind. I will be the first to say that the U.S. Dollar is now past its heydays, and can't be "workably" extended much more without a collapse in value. Buying Gold now will PRESERVE our wealth against these devaluation-related losses. Further, the failure of the dollar will likely be accompanied by the failure of the Gold banking and Gold derivative system. Buying physical Gold now will provide GAINS in wealth when THAT failure occurs. ANOTHER's pitch for FreeGold would help ensure that Gold does not again suffer from any more artificial depressions in value as we now have.]]

The effort to service debt is the sustenance of the purchasing power of a debt currency. While the dollar use within trade is simply as a medium of immediate exchange, this nanosecond of time in which a dollar is used is not where its nature shows. Where it shows is in the time between receipt and use - when it sits in your pocket, or in your account. Devaluation takes time and is thus not reflected in the moment of transaction.

[[That's right. As such, the easiest system for people to cope or "work" with is one in which the month to month losses (as reflected in rising prices) are tame--like two percent per annum as targeted in the euro system. Even there, Gold remains the natural choice for true individual savings.]]

Gold. Get you some. ---Aristotle
Leland
And, Thank GOODNESS, we have John Crudele...My vote for the most Honest Reporter...Here's his Latest
CoinGuy
Oh those Rumours....
ALL,

Been hearing plenty of rumours about the Japanese purchasing Bullion out of Singapore. Heard it from a numismatist friend recently, and then Le Metropole this evening sent me an e-mail stating the Japanese were buying gold bullion under a pretense of a collapsing dollar. I've been under the impression that Japan was selling their bonds back stateside for sometime now and was threatening to purchase Gold, but no evidence of purchases.

Coinguy

Black Blade
PGM articles that obviously ignore certain PGM facts.
http://www.miningweb.co.za/Platinum price and stocks to tail off soon

Black Blade: Don't count on it! Following from miningweb.com

I'm worried about platinum. I know I'm in a minority here, but I feel that anyone considering buying a platinum share at the moment is placing themselves in a position of double jeopardy. My main concern is that the platinum price is bound to fall at some stage in the future and that when it does, share prices will follow it down. Perversely, the longer platinum and platinum group metal (PGMs) remain at their present levels, the worse the coming pull back and the worse the consequences for investors.

Why am I so certain that PGM prices will fall � mostly because I've seen it all before.

Forget the short-term oscillations caused by intermittent Russian supplies, the real threat to the PGM market is substitution. It is important to remember that PGMs are not essential, rather they are convenient. PGMs in various ratios are necessary for the current generation of autocatalysts, but there are other solutions to the problem of emission controls. These other solutions are not in mass use today, because a PGM-based autocatalyst is, for the price, a more efficient answer. But note the emphasis on price.

Some years ago the dominant type of autocatalyst was the so-called "three-way" version. This product consumed PGMs in ratios that did not apply in nature. The most important element was platinum so the producers tailored their production to meet its level of expected demand. In the process, they over produced palladium which then languished around the $70 per ounce level and under produced rhodium which spiralled up to a dizzy $8 000 per ounce.

At the time, many commentators stated that since rhodium was essential for three way autocatalysts and since it was always going to be in chronic under supply, its price could keep going up. All very true, except that rhodium at these price levels made three-way autocatalysts too expensive relative to an alternative palladium based product. So the automakers switched and the rhodium price collapsed.

However, the switch to palladium caused its own long-term problems. South Africa's producers continued to tune their output principally to the expected demand for platinum and so under produced palladium. The shortfall was made up by Russian sales from stockpiles and production at Norilsk. It is now clear, that Russian new mined palladium was insufficient to meet this demand and thus the palladium market became squeezed with the obvious result.

Bad news for palladium

So once again we have a product � palladium � apparently in massive demand with a problem of chronic under supply. So surely the price must keep going up? Er, no � remember rhodium. At these price levels, palladium autocatalysts are becoming uncompetitive and risk being substituted by the old three-way product, or even by some new technology. More worrying, the world's auto makers are becoming concerned that a key element of their global production programme is tied to the whims of the Russian Government and its export quotas.

Unless these companies can be convinced that there is an alternate safe, secure, long-term source of palladium supply, I am afraid that they will step up the search for alternatives. This also applies to the other PGMs. High prices will spur the search for alternatives and when one is found and it will be, the existing metal producers will find that their market shortage rapidly becomes a huge surplus.

To their credit, the South African producers are fully aware of this problem. In the past, they were scared to ramp up their production schedules, as they were concerned that they could get hit by unquantifiable sales out of Russia. They now appear convinced that Russia has very little stockpiled material left and thus are now free to expand their production to meet market demand.

Anglo American Platinum Corporation, Impala Platinum, Lonmin, Northam and the rest know that scaling up output will bring down prices but they also know that this has to happen if there is to be any long-term future for their product (see linked SA platinum output and Net Prophet May stories).

So in the long-term, the prospects are sound, but shorter-term? Company earnings are going to continue to rise, but share prices do not always follow earnings. The correlation between dollar-based PGM prices and share values is far higher than that between the latter and company earnings. Take it from me � weaker PGMs will see weaker share prices. And also take it from me � if the South African producers cannot get PGM prices down within the medium term, consumers will find an alternative and then prices will crash. This looks like a lose/lose scenario to me and I don't like betting on those.
By: London Calling

Black Blade: First of all, there have been rumors as to the new miracle metal to replace PGMs. This has continued for several years now. OK, where is it? I don't see it! Sure there are some possible substitutes, but really, what manufacturer is going to load scrubbers weighing several kilos onto motor vehicles? Several third world countries such as China are starting to require new auto emission standards requiring more PGM usage. If fuel cell technology becomes viable, then look out! PGM prices will blast off into the stratosphere. Even PGM bear S.J. Kaplan gave up on calling for short positioning in PGMs as the price climbed over the last year. The Asian community still buys platinum jewelry in increasing quanitity and therefore putting more pressure on Pt supply. Oh, BTW, notice that Pd is up +$22.00/oz since yesterday recovering the previous day's losses? The Russians? This third world country can't deliver anything except unfounded rumors of "deliveries soon!" over the last year or so. Besides, Norilsk Nickel yesterday announced that they will only deliver about half as much Ni and Cu to market this year! Hmmmmmnnnnn...... Short of a drastic economic collapse and massive PGM dicoveries and production, don't count on any serious downward price movements.

What to do if the platinum price slides

Punters that share London Calling's bearish view on platinum can leverage that position without having to delve into elaborate stock shorting schemes. Warrant issuer Standard Bank has a put instrument over Amplats listed on the Johannesburg Stock Exchange. A put warrant increases in value if the share price over which it's listed depreciates.

In the case of the Amplats put warrant, the expectation is that it will enjoy significant upside should the underlying share price fall sharply below the warrant's strike price of R190. The Amplats share itself is currently at R194 with the warrant trading at 73 cents.

The Amplats counter is highly geared towards the platinum price, which means that the fortunes of the metal and stock have historically moved in tandem. This should translate into put warrant strength if your negative take on platinum pans out.

There are risks involved. The warrant in question expires in nine months time, three months ahead of London Calling's one-year view. Also, all of the current value of the warrant is made up of "time value" because the warrant is "out of the money". This "time value" decreases as the warrant nears its expiry date (15 March 2001). In simple terms, the stock needs to fall faster than the time value does.

The best strategy to employ when investing in warrants is to hold onto the instrument for no more than a month, particularly with a short dated warrant like 4AMSSB. This will eliminate much of the time decay.

Naturally, the biggest risk is that London Calling has got it all wrong and that the platinum price rockets.
By: Byron Kennedy


Black Blade: Yeah, if anyone plays that game, and London Calling has it wrong, I'd call that a pretty big risk. Remember TOCOM defaulted on Pd contracts not that long ago. Traders in Tokyo are still apprehensive about dipping their toes back into those shark-infested waters. Can't be to far off base with solid earning PGM producers like Stillwater (SWC), or taking posession of physical Pt. Paper games are a bit risky as the rule-makers can and do change the rules when it is in their best interests to do so.
wolavka
Watch live cattle contract
Where's the beef.
wolavka
De Ja Vu
Last years hog prices where at record lows at 26 per hwt.

now 70 per hwt. forced alot of locals out of mkt forever.

packers controlled mkt. Nothing has changed, gold in same boat.

House cleaning almost over...
Cage Rattler
Mergers & Aquisitions
Why are almost all M&A's between the US and Europe being done on the direction of Eruopean firms buying out US firms? Is it an attempt by Europe to catch-up with globalisation or is there something more to it? A result is a persistent weight on the euro.
Cage Rattler
Mergers & Acquisitions
Why are almost all M&A's between the US and Europe being done on the direction of Eruopean firms buying out US firms? Is it an attempt by Europe to catch-up with globalisation or is there something more to it? A result is a persistent weight on the euro.
JavaMan
Aristotle, your msg# 33240: Chats with ORO...
Excellent presentation, Aristotle!

Thank you for your comments and elaborations on ORO's messages. Rather profound, I thought.

[[...The run on Gold will be global, and glorious--if you already have Gold, that is.]]

Now there's a one liner...
Black Blade
Morning Wakeup Call! Could get lively today, then again.....
Sources: VariousAsia Precious Metals Review: Gold hovers ahead of weekend
By Hiroyuki Fujiwara, BridgeNews

Tokyo--July 7--Spot gold stayed between U.S. $283 and $284 per ounce with very thin trade on Friday in Asia. Players were hesitant to decide gold's price directions ahead of the weekend and the U.K. Treasury's next auction scheduled on Wednesday, dealers said. Platinum extended overnight recovery on short-covering, they said. Producers could not resume massive selling at the current price levels and physical demand is likely to support prices at about $280, however, few players are willing to buy gold here, the dealers said. The market sentiment still remained on the relatively weak side due to crude oil prices' slump and the steady U.S. dollar/yen, they said.

Black Blade: Crude dipped to $29.99/bbl at yesterdays close. Oil looks to recover today on news of bitter dissension within OPEC over proposed Saudi increases. Could get interesting.

Japan's forex, gold reserves up to record high $344.846 bln in June

Tokyo--July 7--Japan's foreign currency and gold reserves in June totaled $344.846 billion, up $3.710 billion from a month earlier, the Finance Ministry (MOF) said Friday. June forex reserves reached a record high level, outdoing the previous historical high of $341.136 billion marked in May 2000. (Story .697)

Black Blade: Interesting!

India MMTC expects central bank nod for bullion hedging in Jul

New Delhi--July 7--India's state-run MMTC Ltd. expects the Reserve Bank of India (RBI) to clear its plan to begin hedging in bullion by July end, a company official said Friday. The RBI permission will enable MMTC to commence hedging operations in gold at world's leading metal exchanges, he said. (Story .12074)

Black Blade: Monkey see, Monkey do.

Serbs May Get Gold Coins Instead of Old Savings

BELGRADE, Jun 27, 2000 -- (Reuters) Serbs who lost all their savings when the government of Socialist Yugoslavia froze them in the early 1990s may be paid back in gold coins, the central bank governor said on Monday. "There are some gold coins, currently held at the central bank's treasury and these can be offered to repay some old savings," governor Dusan Vlatkovic said. "The face value of each gold coin slightly exceeds 150 German marks. But the government has yet to decide whether these coins will be offered as a repayment," he told reporters. According to local media reports, the National Bank of Yugoslavia has 200,000 gold coins that may help the state settle a 30 million German mark ($14.33 million) debt to holders of the frozen savings. The government, which faces local and federal elections in November, has promised to pay back a total of 183 million German marks this year. The government started repaying deposits on June 1 in dinars, having launched a special dinar incentive on top of the Yugoslav currency's official exchange rate, bringing it in line with the black market value, Under the scheme, the value of the German mark is 20 instead of 6.0 dinars, which remains the official rate but is now almost never used. According to the Yugoslav Banking Association, banks have so far repaid 460 million dinars or 23 million German marks. Total savings frozen by state-run banks since the early 1990s are estimated to be worth some $4.0 billion, affecting one and a half million of Yugoslavia's ten million population. The state promised to repay the whole debt over 10 years. The four Yugoslav republics which broke away from present-day Yugoslavia have their own schemes to repay the savings. Some have finished and Montenegro, Serbia's smaller, Western leaning partner, is ahead of Serbia on its repayments. Cash-poor Yugoslavia has obliged exporters to sell 10 percent of their hard currency receipts to the central bank in order to get cash to start repaying the debt in hard currency. "We expect between 15 and 20 million German marks to be collected from exporters each month. As soon as the funds start arriving, the banks will be paying back," Vlatkovic said.

Black Blade: Don't suppose that the previous gold coin owners were Kosovars or Bosians do you? Of course payment in gold teeth would be a bit obvious.

JAPAN: RUSSIA PGM TERM SUPPLY TO JAPAN SEEN RESUMING SEPT.
By Aya Takada - 7 Jul 2000 07:04GMT

TOKYO, July 7 (Reuters) - Russian exports to Japan of platinum and palladium via long-term supply contracts are likely to resume around September as talks over volume and prices have started, traders said on Friday. Such contracts between Japanese customers and Russia's sole platinum group metals (PGM) export agent Almazjuvelirexport (Almaz) have been delayed in the first few months of the past four years due to bureaucratic problems in Moscow, forcing market prices higher during that period of uncertainty. On Friday, Tokyo Commodity Exchange palladium futures prices rebounded from four days of declines, with the benchmark contract surging by its daily limit at one point. Platinum futures extended Thursday's gains after a three-day slide. "We have obtained an offer of platinum and palladium under a long-term contract effective until the end of 2000," said an official of a major Japanese PGM importing company on condition of anonymity. "Rhodium was not included and they did not explain why." The offer followed an order by Russian metals giant Norilsk Nickel to Almaz on Monday to sign PGM sales contracts with its Japanese customers. The Japanese official said that, based on his experiences in the past few years, negotiations with Almaz over volume, prices and other terms of contract will probably continue throughout July, with a price quotation period seen starting in August. "I expect the first delivery of the metals under a new contract will likely be made in September," he said. A trader at a different Japanese trade house approached by Almaz said the Japanese company is now consulting with end-users about how much metal they need before making a counter proposal to Almaz over a term contract. Almaz has offered to sign term contracts for platinum and palladium with Japanese trading houses Sumitomo Corp and Mitsui & Co. , the companies' representatives said in Moscow overnight.

MATTER OF TRUST

Platinum and palladium futures on TOCOM - under selling pressure after news came out on Tuesday that Norilsk had ordered the signing of PGM deals - rebounded on Friday, traders said. "Long-liquidation triggered by expectation of Russian export resumption gave way to short-covering and fresh buying on the back of bullish metals fundamentals," said an analyst at a Japanese commodity brokerage. "Russia is moving to supply metals under contracts for this year, but exports will probably stop after the contracts expire. We don't want to go short on platinum and palladium futures for delivery next year," he said. Benchmark June 2001 platinum was up 13 yen per gram at 1,673 yen at 0449 GMT. Benchmark June 2001 palladium was 54 yen higher at 2,053 yen, after surging by its 60-yen daily limit to 2,059 yen. Spot platinum was quoted at $542.00/549.00 an ounce, against Thursday's European close of $536.00/543.00. Palladium was quoted at $634.00/644.00 against $635.00/645.00. Before regular supply from Russia resumes, traders said platinum was still on course to test an upside target at $600, with palladium seen heading towards $700. But some market watchers advised caution. "In the past four years, we have repeatedly heard of such talks but we have found we cannot trust them until the airline carrying the metals from Russia touches down at Narita airport as promised in the contracts," another Japanese trade house official said. ((Tokyo Commodities Desk +81-3 3432 7431 tokyo.commodit.newsroom@reuters.com)).

Black Blade: Oh boy, another Russian rumor, September now is it? The last sentence says it all! Can cry wolf only so often.

Meanwhile, S&P Futures +3.80, fair value +6.98 indicating a moderately higher open on Wall Street at these levels, Au up +$1.50 at $283.90, Ag down a penny at $4.97, Pt down -$6.00 at $538.00, Pd up $3.00 at $639.00, and Rh up yet another $50 at $2350/oz. Oil edging up $0.05 to $30.04/bbl.

Speculation: Watch PGMs rise as these rumors are put to rest, also OPEC members are at each others throats, look for higher oil as the market tries to figure out what the hell is going on. And throw in a little unemployment number surprise to stir up the stench a bit. Hey, maybe a couple of earnings downgrades for good measure. Could be more fun than a barrel of monkeys today!

Hill Billy Mitchell
@Leland, Leigh, anybody
Leland or anyone on this...

I have a question?:

Leland's post as follows:

Leland (07/07/00; 02:03:40MT - usagold.com msg#: 33242)
And, Thank GOODNESS, we have John Crudele...My vote for the most Honest Reporter...Here's his Latest
http://nypostonline.com/business/7393.htm

Our central scenario is that payroll growth will snap back this month, particularly as the competition for census hiring subsides."

Question:

What does Crudele mean by the phrase, "census hiring subsidies"?

Also Leigh you mentioned last week if I remember correctly that William E. Simon died in late June. I have no TV read very little newspaper and just a generally uninformed freak when it comes to current events. If it weren't for this forum I would not know that a presidential election is coming up, an election, I fear could still possibly be cancelled by Klinton via a national emergency, martial law scenario.

Anyway could you confirm this about Simon. He has been one of my hero's, just a notch below Phillip Crane.

hbm
Leigh
William Simon
Dear Hill Billy: Yes, sadly it's true. I saw an article about his death on NewsMax the first weekend of June. I then went into the search engine on my computer and found numerous articles about him. He had been ill for some time with pulmonary something or other.

He seemed like a great guy, and I imagine he would have enjoyed our discussions here.
Leigh
Hill Billy Mitchell
http://www.newsmax.com/commentarchive.shtml?a=2000/6/8/193735Here is a short biography of Mr. Simon. What a guy.
Black Blade
Job report, unemployment numbers.
http://www.quicken.com/investments/cbswatch/market_snapshot/?column=P0DSTS&P Futures bounced higher, and looks to be a higher open on Wall Street in a few minutes as traders take a positive veiw. PGMs moving higher as Russian rumors are veiwed as likely nothing more than tall tales. Oil should move higher as OPEC members are not at all happy. Besides, Saudi can not raise production without a consensus. This would be "open" cheating and the cheating is the very thing that OPEC had hoped to overcome and avoid. Other than that....Let the games begin!
Leland
Sir HBM
I have a friend who's taken one of the census taking jobs
of interviewing people who failed to return their census
forms.

His opinion, these jobs will be mostlyfinished by the end of this summer. These are temporary jobs and will "subside" by
fall season.
Black Blade
@Leigh
Interesting Bio on W. Simon. A wealthy man, devout Catholic, etc. Practices what he preaches, etc. Makes one wonder about the old religious reference about a it being easier for a camel to pass through an eye of a needle than for a rich man to enter heaven, etc. Nice story for the start of today's market action as many pursue wealth. Thanks, Black Blade.
Henri
Black Blade Msg 33244
PGM's I am reading between the lines and making a wild *ss guess but I wouldn't be suprised to find out that the underwriter of the warrants on Amplats is connected to the same group putting out the negative spin on PGM's (it's amazing what gets put into print for a few bucks).

Short term or long term, the future of PGM's is extremely bright. There just are not enough to go around. The US platinum eagle is a thing of beauty (and a joy forever). the thought of it being converted to sponge just makes me cringe.

As for rotation into and out of PGM price cycles... rhodium, Platinum, Palladium...the author seems to miss the obvious that these are all Pgm's and come from the same types of geological deposits...(nickel as well). THEY ALL COME FROM THE SAME MINE...Duh! What is good for palladium is also good for platinum and rhodium. Buy Pgm's on the dips.
USAGOLD
Today's Market Report
http://www.usagold.com/Order_Form.html FOR AN INFO PACKET ON GOLD OWNERSHIPMarket Report (7/7/00) Gold was thinly traded in both Europe and Asia overnight in advance of
next Wednesday's Bank of England gold auction. Gold news was sparse save an interesting
Reuters article that Yugoslavia is considering a plan to repay its citizens' saving lost in the early
1990s in the form of 200,000 gold coins sitting quietly and undiminished in terms of purchasing
power in the central bank. Standard Bank of London reports that yesterday's trading was pushed
early by speculative buyers and then capped by producer selling. Physical buyers came back at the
$283 level, according to the London bank. All in all, this is a quiet time for the volume gold
traders with the market affected directly by both the annual summer doldrums and the upcoming
BOE sale.

Have a nice weekend, fellow goldmeisters. We'll see you here Monday.

An Invitation:

I would like to invite those who take an interest in the type of analysis read here to give our
newsletter a try -- News & Views: Forecasts, Commentary & Analysis on the
Economy and Precious Metals. This month we focus on oil and inflation. Many analysts and
investors think there very well may have been a fundamental shift in economy that could favor the
gold market and hammer the equities and dollar market. These opinions from various sources are
covered in some detail in the upcoming July issue. Along with the latest issue of News & Views,
you will receive our Gold Almanac 2000 which offers fundamental background on the yellow
metal. The theme of this year's Almanac is wealth preservation and one of the key articles is
how those in the 1970s -- a decade many are comparing to the present -- not only survived double
digit inflation, but prospered. The package is offered at no cost or obligation. You can call
Marie at 1-800-869-5115 to request the newsletter and Almanac or click here.
Leigh
Trail Guide
Trail Guide said he'd come back when the trail got red-hot. Does that mean we'll never hear from him again?
Henri
Michael "News & Views"
Just wanted to tell you that I really enjoyed the latest issue. Lots of great stuff in there! Keep up the great work
Golden Hook
THE DEMISE OF THE GOLDFLIES:-
Upon the death of a bunch of flies which died from raid posining was on their way to the great fly pile in the sky.

They all meet as all flies do with flies from all over the world. One fly said, dieing from raid is going to get us the lowest of the lowest place in the flypile. So they all agreed in order to get the best place in the flypile
they should get the best demise tale that would please the fly of all flies guarding the gate of the gerat piles in flyplace. He was a bruiser for great demises.

Hundred had died from raid killer. so much for them.

One had died from a vehicle smash.

Thousands from freezing.

Fifty five from a swat.

Many eatin by hornets.

Hundreds by spider webs.

AND one, Just one had died beyond belief.He said, You see I was just flying around downtown eating from whatever I could find leftover. Was enjoying myself to no end eating off of the plate of a broker until he threw it in a garbage can.

Then thought I would fly around a little to work off the big meal. I light on a parking meter next to the brokagehouse. Got smahed to bits by a long holding goldbug.

I wonder what made his day. sneaky;
schippi
POG Chart Based on SilverBaron's World Currency Model
http://www.SelectSectors.com/pog.gif Linear projection shows mild decline.
non-Linear shows a move Up.
Interesting that after 5 days,
they BOTH have the same value.
Leland
A "Typical" Precious Metals Investor...
As a Delta Air Lines jet was flying over Arizona on a clear day, the
co-pilot was providing his passengers with a running commentary
about landmarks over the PA system.

"Coming up on the right, you can see the Meteor Crater, which is a
major tourist attraction in northern Arizona. It was formed when a
lump of nickel and iron, roughly 150 feet in diameter and weighing
300,000 tons, struck the earth at about 40,000 miles an hour,
scattering white-hot debris for miles in every direction. The hole
measures nearly a mile across and is 570 feet deep."

From the cabin, a passenger was heard to exclaim, "Wow! It just
missed the highway!"

bravos
Liquidity is leaking out of the.......
Interesting article from the Economist magazine some may find of interest........

"Liquidity is leaking out of the world's financial markets"

http://www.economist.com/editorial/freeforall/current/index_fn3060.html


Best regards.........bravos

Leland
To Aubree, (My 6 Year-old-Great-Granddaughter), Just Keep Reading Michael's Forum...You'll be lots Wiser Than I am Very Soon...Pappa
.
Leland
For Your Young Ones, Don't Miss THIS!
"Ship of Gold" on the History Channel

Ordinarily, the Atlantic Ocean off of the coast of the Carolinas is a beautiful place enjoyed by
millions for recreation, commerce and industry. However, each year, from June through November,
the seas off of the Carolina coast can become a treacherous area for mariners. Over the past 200
years, this area has been victimized dozens of times during what has only relatively recently been
known as the Atlantic hurricane season. The year 1857 was one of those times.

In September 1857, a massive hurricane plowed through the Atlantic off of the Carolina coast and
left America's worst peacetime maritime disaster in its wake. In this tragedy 425 innocent passengers
and crew of the steamer SS Central America perished in the huge waves of a forever-unnamed
hurricane.

In addition to the immeasurable human costs, there was also a large economic cost associated with
the wreck of the Central America; $1.6 million in gold bullion and coins went to the bottom of the
sea on board the ship. That loss of gold contributed to the financial panic of 1857.

In 1981, marine biologist Tommy Thompson and a group of highly trained associates set out to find
the Central America. After years of diligent research, an effort was made to see if her resting place
could be found.

The search began in 1986 and encompassed a search area off of the Carolina coast larger than the
state of Rhode Island. In 1987, Thompson's team, now called the Columbus America Discovery
Group, investigated a promising site 8,500 feet down. After just 3 hours, an unmistakable image
filled the video screens from a camera attached to an underwater robot: a rusting sidewheel lying flat
on the bottom of the ocean. Shortly thereafter, the robot discovered the ship's bell from the Central
America, confirming the wreck's identity. And so began one of the most sophisticated salvage
operations in history.

The Greatest Treasure Ever Found

The coins of the SS Central America are unique in terms of their quality, availability and pedigree.
Never before in the history of rare coins has such an offering occurred.

The surviving gold pieces of the SS Central America treasure came to rest 8,500 feet below the
surface of the Atlantic Ocean. If these coins could talk, what tales they could tell! These were the
coins saved and spent by the men and women who carved a young nation out of an untamed
wilderness--hardy pioneers who marveled at the gleam of a freshly minted gold piece. These heavy,
gold-rich coins were struck from gold strikes on America's western frontier.

These gleaming keepsakes from America's past remain a tangible reminder of our rich heritage.
During the more than 130 years that they were hidden at the bottom of the Atlantic Ocean, America
was transformed from a frontier nation to an industrial world power. This historic treasure is a
touchstone of the values and ideals that built our great nation. The inspiring legend of the SS Central
America, combined with the awesome beauty of the coins themselves will make these Double
Eagles among the most desirable collectibles ever. Each is a stunning piece of American history that
will be treasured for years to come. One hundred forty three years after they were struck, these
coins still boast sculptured details, golden luster and bold, full strikes that will make them desired by
collectors around the world. They will forever remain valuable American treasures...living reminders
of our rich and glorious past.

This is the story of the SS Central America and now it is being told on the History Channel. The
History Channel will air a one-hour show entitled "Ship of Gold" about the SS Central America
on Monday, July 10th at 8:00 PM Eastern/Pacific.

In 1857, the S.S. Central America vanished in a killer storm off North Carolina's coast, taking with
her nearly 21 tons of gold. The History Channel is now telling this fantastic story, and how hi-tech
treasure hunters recovered her fortune.


July 9, 2000

(From GOLD-EAGLE)
Journeyman
Is there enough gold for the world to go back on the gold standard?
http://www.mises.org/humanaction.asp
Question 5: Is there enough gold for the world to go back on the
gold standard?

...As the operation of the market tends to determine
the final state of money's purchasing power at a height
at which the supply of and the demand for money
coincide, there can never be an excess or a deficiency
of money. Each individual and all individuals together
always enjoy fully the advantages which they can derive
from indirect exchange and the use of money, no matter
whether the total quantity of money is great or small.
. . . However, the services which money renders can be
neither improved nor repaired by changing the supply of
money. There may appear an excess or a deficiency of
money in an individual's cash holding. But such a
condition can be remedied by increasing or decreasing
consumption or investment. . . . The quantity of money
available in the whole economy is always sufficient to
secure for everybody all that money does and can do.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 421 [XVII. INDIRECT EXCHANGE 6. Cash-Induced and
Goods-Induced Changes in Purchasing Power -available also from
http://www.mises.org/humanaction.asp]

As von Mises points out, there is no problem with the quantity of
any money including gold -- as long as that quantity is
relatively stable. It can be divided and sub-divided as necessary.

The problem is with who would lose and who would gain in the
transition from fiat back to gold. Unfortunately, the losses are
so huge, it's unlikely the transition back to gold as money will
happen by direct design. Instead, the transition from the latest
fiat paper money experiment back to gold will likely come in
through the back door as a result of demand for a stable
(relative to fiat) and world-wide standard of value.

Gold's reintroduction as money could be facilitated by modern
banksters who forget the lesson that fiat has never won a fair
fight with gold. This is not as unlikely as it seems: The ECB
"marks it's gold to market" regularly, or from the inverse
viewpoint, it marks it's currency to gold regularly. And, as ORO
suggests, in revaluing it's gold, the IMF became a little
pregnant - - - with a golden baby.

Regards,
Journeyman

In case you tuned in late, this post is Mises "answer" to
question 5. of the following six posed in an earlier post.

1.Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?

Al Fulchino
Good TV
You might check your listings. The Discovery Channel is running a show called On The Inside, "The US Mint". Great for youngin's and some of us oldin's too.
Journeyman
Is gold too expensive to be efficient for use as money?
http://www.mises.org/humanaction.asp
Question 6: Is gold too expensive to be efficient for use as
money?

From the point of view of this insight [that the
quantity of money available is always sufficient -j. ]
one may call wasteful all expenditures incurred for
increasing the quantity of money. . . . It was this
idea that led Adam Smith and Ricardo to the opinion
that it was very beneficial to reduce the cost of
producing money by resorting to the use of paper
printed currency. However, things appear in a different
light to the students of monetary history. If one looks
at the catastrophic consequences of the great paper
money inflations, one must admit that the expensiveness
of gold production is the minor evil.

-Ludwig von Mises, Human Action A Treatise on Economics, Third
Revised Edition (Chicago, Illinois: Contemporary Books, Inc.
1966), pg. 422 [XVII. INDIRECT EXCHANGE 6. Cash-Induced and
Goods-Induced Changes in Purchasing Power -available also from
http://www.mises.org/humanaction.asp]

Regards,
Journeyman

In case you tuned in late, this post is Mises "answer" to
question 6. of the following six posed in an earlier post:

1. Why has the word "inflation" become confusing? What are the
results of this confusion?

2. What did Charles DeGaulle mean by "extravagant privilege?
What's another little-used word for it? What would happen if
"the privilege" were exercized world-wide?

3. Did markets and the people choose paper money over gold? If
not, who did?

4. Does government/Federal Reserve monetary control serve the
common good?

5. Is there enough gold for the world to go back on the gold
standard?

6. Is gold too expensive to be efficient for use as money?
Journeyman
Explanations and apologies

I would have posted the two von Mises "answers" long ago but some wierdness involving spaces at the beginning of successive lines (filtered out by USAGOLD software anyway) seem to gum up either my browser or my ISP. It's taken me an unbelievable amount of time to figure that out. Hope it helps other posters to know.

Regards,
J.
Netking
@Leland
Leland (33264)
What hope is there old chap . . . that passengers intellect is scaring me at this point!


Black Blade
@ Netking and Leland
I am not surprised!Just a product of US public education (government sponsored re-education camps). Here in the US we call it "Dumbing-Down". No wonder that our best and brightest are imigrants. Here teachers are underpaid and considered low-class, as a result, the best and brightest don't go into the profession. There are communities that are building housing projects for teachers (Santa Clara Co., Ca. for example). Who in their right mind would go into teaching today? Also it should be noted that the top 3 places in the "National Spelling Bee" and the top place in the "National Geography Bee" were home-schooled. As one of our regulars here is so fond of saying: Sheesh!
Leland
@Netking
http://www.users.dircon.co.uk/~netking/finan.htm#tquotnsTo the benefit of all of us on this forum, you deserve a
THANKS! for your many efforts to enlighten. Just in case
some don't know you, I'm posting your web site. THANKS AGAIN!View Yesterday's Discussion.

Leland
Talk About Internet Hit Records...Matt Drudge Just Might Have the Highest
http://www.drudgereport.com/VISITS TO DRUDGE
7/07/00

001,314,991
IN PAST 24 HOURS
034,488,007 IN PAST 31 DAYS
320,172,667 IN PAST YEAR
Leland
Latest From PrudentBear...
http://www.prudentbear.com/credit.htm/"The longer the Fed allows this
unhealthy boom to endure, the more devastating the impact.
Repeating the great words of wisdom from Mises, 'There is no
means of avoiding the final collapse of a boom brought about by
credit expansion. The alternative is only whether the crisis should
come sooner as the result of a voluntary abandonment of further
credit expansions, or later as a final and total catastrophe of the
currency system involved.'"

(Click for Full Story)
wolavka
Die Hard fans
We now are entering the week when gold won't look down again.

I expect sunday nite globex to trade on open over fridays high, very good support now, last chance enjoy the trip.
wolavka
New Sheriff in town
Time to remove the old roman civil law.

GOLD IS THE LAW.
Netking
Leland
Leland (33274)
...I continue to fight the good fight against the 'Plunge protection team' & to advance against the 'dark side of the force!'
Have a nice weekend.
regards
Netking

Bonedaddy
Natural gas explosion!
http://biz.yahoo.com/ii/000629/fund_000629.html In my line of work an article entitled "Natural Gas Explosion" is a guaranteed attention grabber. I was only a little relieved to discover that it was about a price explosion. Please check out the link provided to find out about one analyst's view. I see this information as relevant to the GOLD and oil discussion because of the "law of unintended consequences". Until fairly recent history, natural gas production was an additional benefit of oil discovery. Raw natural gas is usually comprised of 70% or more of methane. The other components, ethane, propane, butane, and pentanes plus, are found in smaller quantities in natural gas. All domestic use of natural gas in the United States is predicated on a methane purity of about 90%. This is because the heavier hydrocarbons must be removed so they won't revert to the liquid phase in distribution pipelines and wreak havoc on end users. The link between oil production and natural gas (methane) prices is this: Methane gas has a relative vapor pressure of about 5,000 pounds per square inch! So, it is almost never transported by tanker as a liquid. (Methane must either be kept under great pressure or about -200 degrees f to remain in the liquid state.) I hope I'm not getting too technical here, but it should suffice to say that tankers of methane will never arrive from the middle east. If it weren't for the Canadian gas pipelines, the US would really be hurting for gas supply. When US oil production is idled, we miss the added benefit of domestic gas production. When new gas well drilling must be supported soley on gas economics, the price has to go up. (We don't get to use the drill one get one free coupon.) The winter of 2000-2001 will see the highest natural gas prices in history! Federal environmental regulations have forced much of our industry and electrical generation to switch to "clean burning natural gas". On the positive side, the US has enough natural gas reserves to last a long, long, time. But short term, that gas will cost more than ever before, because new infrastructure must be built every day to bring new supplies to a rapidly expanding market. When Energy Secretary Bill Richardson tells us that energy prices will fall over the next year, he is either lying or stupid. At any rate, he probably won't be around next year to oversee the GUARANTEED comming energy crisis or supervise the theft of any more nuclear secrets. As for the effect on the price of GOLD, I don't anticipate much change until the hapless masses wake up and smell the mercaptain.
Black Blade
@Bonedaddy, this article just adds emphasis to your post.
http://pub3.ezboard.com/fdownstreamventurespetroleummarkets.showMessage?topicID=947.topicNatural Gas Outlook 2001
--------------------------------------------------------------------------------
(Energy) Natural Gas Outlook 2001 - $7/MM Btu

NATURAL GAS: THE FIVE STAGES TO MARKET PANIC
by Charles T. Maxwell, Senior Energy

Analyst ( maxwell@weedenco.com )

The low natural gas reinjection numbers we have seen so far this spring in the US tell their own tale. We are not on our way to putting three trillion cubic feet of gas, or anything like it, into storage for use next winter. From a low of one trillion cubic feet ( and nearly 50 % of that is facility and line "fill", i.e., is not usable ) , we would be fortunate now to bring stored supplies up to 2.3 Tcf by early next November, the start of the gas consuming season. Given the presumed retreat of the La Ni--a weather pattern, the strong US economy, and the substantial number of new natural-gas-fueled base-load generating plants using combined-cycle technology coming on stream over the next six months, I have had to revise my estimate for peak gas storage down a bit from the 2.5 Tcf number I was using two months ago.

In practical terms, unless the coming winter approaches the highly-unusual, +13% warmer-than �usual season we have just passed through, US gas storage numbers are accumulating in a potentially disastrous pattern of insufficient gas to take this country through the full span of cold weather to April of 2001. There is the possibility that we will be forced to allocate gas supplies to private homes, government departments and public institutions, to defense installations and to schools, universities, hospitals, and so on. To the degree that is necessary, gas will have to be allocated away from manufacturing industry.

Hit hardest, in such a period, would be sectors of the economy that use a high proportion of natural gas in their fuel mix such as cement plants, glass works, heat-treating and metal-shaping plants, heavy chemicals, steel, copper and aluminum makers, and so on. Subsequently, problems of insufficient production of component parts and intermediate materials could quickly spread to car and aircraft manufacturers, commercial construction and machine assembly industries. In short, the use of natural gas is so widespread in our manufacturing system that shortages of it for, say, a two month period from late January of 2001 to late March would wreak havoc on many areas of our economy.

It would surely slow national GDP growth, and heavily penalize the profits of many industrial firms. However, all this is theoretical. It really couldn't turn out this way, could it? Yes, it could. And, unless the trends I see in place now of close to 3 % incremental natural gas consumption in the US vs. flat or slightly down natural gas production are reversed for some reason I cannot now perceive, the "disaster scenario" outlined above must be considered the most likely one.

Perhaps the most intriguing part of the emerging outlook for a shortfall in gas supplies is not the fact that the crisis has arrived ( after all it has been predicted for years, and, up to now, nothing serious has occurred ) , but rather the point that we are advancing deeper and deeper into this energy problem and no one, other than a few Wall Street analysts, are making any warning noises about it. The media is quiet.

It is either non-believing or unimpressed by the dimensions of what is visible. Government, at all levels, is complacent. There are no public outcries even from executive figures in gas consuming industries that are heavily dependent on the fuel. We are becalmed in a sea of silence on this issue as we pass into summer. The weather is fair, and the "livin� is easy". And, when winter comes? It's just another season, following summer. Nothing to worry about.

However, a few important people in the system quite plainly see the outlines of what is to come. Their traders are bidding up the price of natural gas dramatically ( now 100% higher than the last year's $2.10 per mm btu price at this season ) in order to secure supplies for storage now - supplies that may not be available next February when many industries could be facing downtime. These gas buyers are doing their homework. And, it is their lead that investors should be following.

Still, I am ahead of the story in my surprise that the media has not yet picked up on the coming crisis. For over the years ( and I have a good many of them ) , it has been my experience that there is a repetitive cycle to how these "threats" to the system are understood and acted on by different parts of our society.

In the case of the emerging shortage of natural gas, to take the example before us, the first group to identify it was the industry specialists ( apart from many natural gas production company managers who had spotted it years in advance ) , in particular a small group of Wall Street analysts who were doing their weekly storage sums and saw that behind the fa�ade of last winter's warmth was a highly worrisome picture of an industry failing to convert its greater effort to find supplies ( some 650 rigs drilling for gas this year vs. some 380 drilling for gas last year at the same time ) into rising output figures. Across the board,
analysts in the oil and gas industry are now convinced there is a substantial problem ahead.

This is Stage One, and it is nearly completed.

Stage Two is the tricky one. Analysts must convince their portfolio people that the problem is real, and direct them to what areas of the market to buy and what to avoid to maximize investment returns. But, portfolio managers are resistant to these arguments ( they have heard them before ) . So, only a few comprehend and accept the fundamental story, then take action. But, those brave souls start building upward momentum into the limited group of gas producing stocks that can be bought in size by the institutions ( APC-53, BR-45, UCL-38, APA-60, DVN-60, and EOG-32, in order of descending capitalization ) . Then, that section of institutional portfolio managers which cannot yet grasp the play itself but which is attuned to moving into stock groups with rising upward momentum in the market ( for whatever reason ) , can be expected to swing onto the story. In this case, the natural gas producing group has recently come up on everyone's charts as being in the lift-off stage.

Finally, the remaining portfolio managers, still not convinced, are forced to act in order to maintain their performance rankings, and they belatedly enter the game.

We are better than halfway through Stage Two now, as I make it out. The fundamental players are "in", and the momentum players are starting to react. But, as to a general capitulation of portfolio managers to the natural gas shortage concept, that will be reserved for quarter-ending rallies in June and September yet to come, if I am reading the tea leaves correctly.

As I have previously noted, the media have not yet focused on this problem. That will be Stage Three.

There is a substantial story to tell here. Outages in industrial plants across ( mainly ) the Midwest and Northeast, with tens of thousands of workers staying home, is a major development. When TV reporters, newspapers and magazines eventually pick up the trend, perhaps several months will have passed and the situation may well be seen as more grave. Having professionally worked through the period of Energy Crisis I and II, it would not surprise me if the media termed the new "threat" as Energy Crisis III.

However, I don't think that this natural gas problem will have the public impact of the first two crises. Lack of gasoline ( read mobility ) and long waiting lines to obtain it may be more effective in influencing the American psyche than 100 industrial plants being shut down. However, Energy Crisis III is a convenient name, and at least it has the advantage of catching people's attention. Stage Three is a big step in the development of a crisis mentality in the market for gas-related stocks. But, we are not yet into this stage yet.

On the basis of widespread ( future ) media attention, Stage Four would involve governmental reaction to this, on all levels. By late summer and early autumn, we will be into the late days of the Clinton Administration's time in office. It certainly could be a political problem to admit that something this important had been allowed to develop, unbeknown to all, into a significant threat to the system.

On the other hand, the issue cannot be easily swept under the carpet because its effects are too close to breaking through into public consciousness. Moreover, the Gore-Bush pre-election debates should be in full swing by then, and Bush would be well guided to raise points, such as this, in which he has had some practical experience and for which no anticipatory consideration has been made in the non-existent national energy plan that President Clinton never formulated ( nor did any other previous US president ) . As I see it, the Government will be forced to confirm the size and scope of the gas problem, and will further alarm industry by referring to the possibility of gas allocation on a national, state or local level.

Stage Four could well occur in September and October of this year. Its outcome would logically lead to Stage Five, the final rush to panic and overexposure. This would be the result of heightened media attention, followed by effective governmental confirmation that the problem was real and might not be easily fixed except through significant sacrifices on the part of the public. Stage Five would represent a general recognition that we could be entering a difficult period of fuel shortages and that the effects might be more serious than mere "inconvenience". It should be noted that under any allocation formula, those organizations and industries that could switch from natural gas to propane, butane, heating oil or residual fuel oil would be asked to do so. And, subsequently, these products might themselves run short under the impact of unexpectedly high demand. They might also advance dramatically in price.

Stage Five would also imply a highly visible case for investing in companies that might be best positioned to assist in solving the natural gas shortage. The final run of small investors� funds into the natural gas producers might represent a "tsunami" of money seeking entry to a play already suffering from limited capitalization, thus forcing gas producer share prices into the "blue yonder".

Stage Five, perhaps occurring in mid-to-late autumn, would, of course, be immediately followed by the actual onset of cold weather. By then, investors would also have full knowledge of the country's three-quarter-filled gas storage position. Early outages might start to occur, for coincidental reasons, in late January of 2001. However, the main weight of the shortfall would be expected to fall when different major storage points in various consuming regions of the country ran out of supplies in February and March of next year. That is when companies, facing closedowns for lack of fuel, should be most pressured to bid for gas to avoid the termination of output and temporary disbandment of their labor forces. So, we have assumed a peak to natural gas prices in February of 2001, probably in the $6.00 � 7.00 per mm btu range following a prolonged period of cold weather.

This could be the high point of fear, when many businesses could be driven to uneconomic decisions just to survive.This would logically be the exit point for experienced investors. With all five stages of the play completed, and the axe of cold weather fallen, this would be the time to collect your chips and leave the game. Conditions will likely not be so desperate or so uncertain again for some time, experience teaches us. Of course, the natural gas problem itself will not suddenly go away. It will take many seasons to find an answer to it. But, we will solve the problem, as we always do. And, as we move through the crisis and consider our options, all kinds of answers will present themselves. Meanwhile, the stock prices of natural gas producers would be expected to start down as early desperation gave way to later resolution.

What will be the eventual answers to the natural gas shortfall? Think about a higher range of prices, application of additional technology, new generations of sophisticated drilling rigs, more LNG receiving terminals, and what can come south from Alaska.
Black Blade
@Bonedaddy
BTW, you wouldn't happen to be working in the coal seam methane plays in the Powder Basin, WY, would you? I thought that you said that you were in that part of the country.
Hill Billy Mitchell
William E. Simon, An American Hero
Lady Leigh

Thanks for your response.

In your link Paul Craig Roberts says, "an American hero died."

What a fitting way to say it. I could just hear Walter Chronkite's voice in my mind when I read that. No fanfare involved here. An unselfish hero would hardly be noticed by the masses. Those who know him personally would be the only one's who know that he is a hero. Reminds me of my father. When he dies only about 500 people will know that a hero died because only about 500 people who are still alive still know him personally.

How did I know William E. Simon personally? I read some of his personal writings and got to know him personally in that way. I can tell you, the man was a hero!

HBM

PS: Come to think of it, that is precisely how I got to know the "Son of the Living God", personally. I read the things He "personally" had to say.

I believe William E. Simon was a hero because he knew
"THE HERO"

Gandalf the White
The Hobbits are hoping that TG has not slipped and fallen off the TRAIL !
Search parties of Hobbits are starting to gather the necessary equipment to begin the search for TG. As HE was last seen in the vicinity of the Paris, and as the Hobbits just love "THE CITY", they shall start their search there!! They are now shouting their call --
"TG -- Where are you ?" "Yoo-hoo, TG, Where are you ?"
---
FOA (06/14/00; 05:19:29MD - usagold.com msg#27)
Off the trail for a while!
Hello ALL,
I noted in my last two USAGOLD FORUM posts (5-13-00) that I will be traveling for a while. Some of the time will be for research, but most will be as "time away". Will bring a laptop to follow the flow of gold discussion while away. It will be quite a few weeks before I return to this trail so
please help yourself to our path. If all goes as expected, we will have a lot of ground to cover when I return.
thanks, FOA/ your Trail Guide
===
<;-)
Leland
An Intriguing Financial Story (Good Weekend Reading)
Scott Burns: Real life suit is
fodder for fiction

07/04/2000

By Scott Burns

It sends chills up your spine. There, in less than 100
pages, is a tale of alleged corporate self-dealing and
executive intrigue involving millions of dollars and
thousands of people.

On Page 6, it tells of a plot to create a profitable
business using hundreds of millions of dollars in
employee pension fund money. On Page 10, it tells
how executives got special cash bonuses from the
profitability of the business that used this money. On
Page 14, it starts to tell the story of the protagonist's
promising career and how it was derailed after he
learned of the internal scheme to use pension and
401(k) money.

There's more. On Page 39, it tells how "tens of
millions" in pension fund assets were pumped into an
international equity fund to keep it from collapsing as
outside investors redeemed shares in the 1997-98
Asian financial crisis. On Page 64, the protagonist
meets his boss in a hotel conference room where he
is summarily fired and asked for the keys to his
office, on grounds of "insubordination" � six days
after receiving a raise, bonus and positive review
from the president and CEO of the company.

A novel by John Grisham or Paul Erdman?

Not at all.

This is real life. It's the pleading in a recently filed
lawsuit, available as a PDF file at
www.newyorklifesuit.com. First filed in October as
a wrongful termination suit on behalf of James A.
Mehling, a former vice president of New York Life,
it was amended and refiled two weeks ago as a
class-action lawsuit subject to treble damages under
the Racketeering Influenced and Corrupt
Organizations Act (RICO).

Filed by a consortium of three law firms (Sprenger
& Lang in Washington, D.C., and Minneapolis;
Stief, Waite, Gross, Sagoskin & Gilman in Bucks
County, Pa.; and Sandals, Langer & Taylor in
Philadelphia), the suit is one of a collage filed since
last fall that allege misuse of money in employee
pension, 401(k) and profit-sharing plans.

One is against First Union and Signet Bank for
expensive investment changes in employee 401(k)
plans. Another is against SBC Communications for
changes in profit-sharing plan holdings that cost
participants more than $1 billion in lost capital gains.

The basic charge in the Mehling suit is that New
York Life, wanting to get into the mutual fund
business, got into it by using assets from its own
employees' pension plans.

The suit alleges that the insurance company took
millions of dollars out of the pension plans and
invested the money in newly created mutual funds
that the company planned to sell to the public.

A few years later, the suit alleges, New York Life
did the same thing with its 401(k) plan, taking
money from low-cost funds and transferring to its
proprietary MainStay mutual funds.

In both instances, the suit alleges, the cost of
managing the money increased, reducing the
investment returns earned by New York Life's
employees. Without the employee money, the suit
alleges, New York Life would have lost millions
operating its mutual fund business, and executives
associated with the fund business would have lost
their bonuses.

New York Life's outside legal counsel Steve Saxon
said, "We think they've misunderstood who we are
and how these plans work."

George Trapp, executive vice president of New
York Life, said, "We're outraged at the lawsuit. In a
[defined-benefit] plan, the benefit is derived from the
final average pay and years of service. The company
contributes the money and supports the plan. It was
overfunded by $21 million in 1991 and was
overfunded by $900 million at the end of 1999.
Over that time the company didn't contribute a single
dollar to the plan. We find it somewhat amazing that
anyone would contest that."

Mr. Saxon and Mr. Trapp also deny the higher cost
allegations, citing a comparison of MainStay fund
expenses with Morningstar averages for comparable
funds.

"That's ridiculous,." countered Russ LaBarge, a
principal at Strategic Capital Investment Advisors,
an investment consulting firm in Oak Brook, Ill. "If
you're talking about a plan in the hundreds of
millions, you don't use Morningstar as a source for
comparable fees."

For New York Life, the consequences of the suit, if
lost, go far beyond the cost of any settlement. One
possibility is that the company could be barred,
under ERISA (the Employee Retirement Income
Security Act) from acting as a fiduciary, essentially
blackballing it from the money management
business.

"It has a chilling aspect." Mr. Trapp said. "... Who
will want to start a defined-contribution plan if they
could face this kind of litigation?"

How will it end?

The only thing certain is that it won't be over any
time soon. Regardless of outcome, however, the
growing number of lawsuits around 401(k) and
403(b) plans means that all plan sponsors had better
pay attention to the fees that come with the
investment products in their plans.

The litigation light is on.

(Thanks To Scott Burns, THE DALLAS MORNING NEWS, And Fair Use For Educational/Research Purposes Only.)
USAGOLD
Leland. . .Corruption in High Places ALL. . . .The Patriot
Thanks for article on the New York Life mess. I don't think I will be giving too much away by publishing this snippet from the July News & Views. (Note: Got a call from the printer late Friday that the press broke down and we are going to be a day or two later than planned on this issue). Not wanting to sound like the clucking Aunt Gertie at the July 4th church picnic (just mortified at the evil-doings going-on around her), I debated with myself whether or not I should publish the piece below which appears as this issue's Final Thought. I opted to go with it in that I think that this is the building story on Wall Street and we are just now seeing the first signs of the wounded and dead straggling back from the battlefield.

There are two key paragraphs to your post which have wide ranging implications:

First

"In both instances, the suit alleges, the cost of
managing the money increased, reducing the
investment returns earned by New York Life's
employees. Without the employee money, the suit
alleges, New York Life would have lost millions
operating its mutual fund business, and executives
associated with the fund business would have lost
their bonuses."

Second:

"For New York Life, the consequences of the suit, if
lost, go far beyond the cost of any settlement. One
possibility is that the company could be barred,
under ERISA (the Employee Retirement Income
Security Act) from acting as a fiduciary, essentially
blackballing it from the money management
business."

I would add a couple additional implications: What about all the people who own insurance policies with New York Life that might feel threatened by these allegations? Would you feel safe if you life insurance policy were with New York Life?

And. . .

I am assuming New York Life is a publicly traded company. How will the market now view its stock value as the company tries to operate under this cloud?

And. . .

If New York Life is doing this, can we safely assume that they are alone in these practices?

The concluding sentence to Mr. Burns' article is correct:

"The litigation light is on."

Wait until this equities bear market gains momentum.

Please read what follows from the recent News & Views hopefully to be on its way soon:
_____________________________________________

Final Thought July 2000 N&V:
The June issue of Grant's Interest Rate Observer surfaces a very interesting Wall Street phenomena that suggests something rotting underneath these financial markets and what might, in our opinion, ultimately spawn a major shift of investor capital into gold. Scandal is nothing new on Wall Street. It has come and gone through the years, been reported by the press, tried in courts of law, and the offenders have paid the price. What's different now is the pervasiveness of the corruption. It extends into almost every nook and cranny of the financial markets and threatens to alter the way Americans view Wall Street and the investments they have made through its financial institutions. There's hardly a day that goes by that some new criminal offense is not brought to light -- from fraud, bribery, stock price manipulation and collusion to threats on peoples� lives and actual beatings of the un-cooperative. So far, most of these activities, which generally have to do with pumping up equity values, have failed to undermine confidence in Wall Street. That could change rapidly if a bear market were to take hold and force some these activities into the light of day.
Mr. Grant starts his important mini-analysis with this quote from the Wall Street Journal : "In the largest one-day securities fraud indictment ever, the Justice Department alleged that members of the country's five largest organized crime families conspired to manipulate publicly traded securities in 19 companies, bilking investors out of $50 million over five years." The indictments got big play in all the media amidst much head-shaking and comment throughout the financial community. But that wasn't the big news on Wall Street criminality that day. Says Grant: "Elsewhere in that same edition was the news that a trio of former executives at CUC International pleaded guilty to orchestrating the biggest accounting fraud in history, costing investors $19 billion." Grant goes on to say that Business Week polled Chief Financial Officers for America's blue chip corporations two years ago on the subject of cooking the books. They were asked to respond to this statement: "As CFO, I have fought off other executives� requests that I misrepresented corporate results." 55% answered, "Yes, I have fought them off." 12% responded that they had yielded to the requests. One third said that they had never been asked.
Leaving alone the fact that the real numbers are probably worse that what has been admitted to, Grant simply says, "The mob is the very least of it." We concur. We would also say that it could get a lot worse for CFOs with the new rules for derivative accounting procedures going into effect for the second quarter accounting period. Why? Because the multi-trillion dollar derivative positions will now have to be marked to market -- losses recognized, blunders and improperly carried trades revealed. In short, there will be substantially more to cover-up.
In addition, as pointed out in the UBS Warburg analysis quoted earlier in this newsletter, "for every US $1 borrowed by US companies in the past three years, 50 cents had gone into equity markets, either in buy-back schemes to support share prices or to buy other companies' stock in mergers and acquisitions." "That is a degree of leverage which is a bit scary," said UBS Warburg's chief economist, George Magnus. Scary indeed, but not half as scary as what will occur when financial strategists begin to unwind all the leverage and find the layers of potential corruption underneath. In a possible future-world where publicly declared values can no longer be relied upon because of behind the scenes manipulations of every description; where the de-leveraging of positions has taken its toll; then gold will be viewed again as an incorruptible bastion of wealth and safe haven without equal -- "the ultimate fiduciary par excellence" as Charles De Gaulle called it.

____________________________________

All: Saw The Patriot last night and can't help but comment on it. It's not just a film. It's an experience you won't forget -- a brilliant, memorable addition to the Gibson/Braveheart genre. Those who criticized the scenes of Benjamin Martin's young sons killing British in the South Carolina woods have a shallow understanding of the plot. At that point the Martins weren't even fighting for the nebulous concept of "country" or "freedom." Martin was fighting to save his son's life and enlisting the two young boys in the fight was the only measure he could take to save him -- a tough choice, but necessary. One wonders how many of us would have made the same choice one under similar circumstances. I also saw Spike Lee's criticism of the film that it shied away from dealing with the slavery issue. In fact it dealt with it head-on in several instances. One memorable character (who I wouldn't be surprised see in the Academy supporting role nomination list) played a slave/Patriot who won his freedom fighting for the Continental cause. When reminded in the final battle scene that he had served his twelve months and was now free, he made a comment that stirred the audience: "I know," he said, " I'm here of my own accord now." I think there is an element out there that cannot handle all the attention this movie is getting. The message is profound and I think it fascinating the amount of discussion this movie widely panned by the liberal media has generated. Just like with gold, the cinema establishment hate it, but the people love it.
USAGOLD
All:
In re-reading my post just below, I note that the "dead" could not be "straggling back from the battlefield." What would grammarian/coumnist James Kilpatrick say?
Leland
A "Gold Nugget" Grade Feature Story (Good for Weekend Reading)
PLACES TO GO WITH
KIDS: CONSOLIDATED
GOLD MINES: Lesson
delivered in a unique vein
Alma E. Hill - Staff
Saturday, July 8, 2000

Where: 185 Consolidated Gold Mine Road,
Dahlonega.

When: Summer hours: 10 a.m.-5 p.m. daily; winter
hours: 10 a.m.-4 p.m. daily. Closed Thanksgiving and
Christmas.

Cost: $10 adults; $6 for children 4-14. Children 3 and
under free. One pan of sand free with admission. $3
for each additional regular pan; $6 each for high grade
pans.

Parking: Free.

Info: 706-864-8473.

Restrooms: No changing tables.

Age recommendation: 4 and older.

Bottom line: You won't leave with your pockets lined
with gold, but the mine is a jewel of a place to take
children.

I didn't "discover" enough gold at Consolidated Gold Mines in Dahlonega to quit
my day job, but the visit was one of the most delightful family outings I've been
on in a while.

The mine was the largest gold-mining operation east of the Mississippi River
when it was begun in the early 1900s. Today, since no commercial mining is
done at the site, it has become a showcase for tourists who want to see inside
a real mine and pan for gold.

Miners lead the walking tours that go deep inside an excavation site that's
about 175 feet below the tunnel, called the Glory Hole because of the extensive
blasting done in the past. It's pretty dark inside, but the climate is just right.
The temperature is about 58 to 60 degrees throughout the year.

On the tour, you get a fascinating introduction to the once-profitable North
Georgia gold belt. You also learn about the mining equipment used at the turn
of the century and the dangerous conditions that miners worked under.

You can even see some of the remaining gold still in the mines, plus quartz and
pyrite in the rocks inside the tunnel.

Although the guides color their comments with humor and explain the
information in a way that schoolchildren can understand, the tour might be a bit
much for toddlers and preschoolers. For example, Emily Winkler, 3 1/2, of
Duluth was more interested in climbing the rocks inside the tunnel than
listening to what our tour guide had to say. And since there are no restrooms in
the tunnel, kids can't go to the bathroom once the 40-minute walk begins. It's
impossible to take a stroller on the tour and there are several sets of stairs to
climb, so unless the kids are good walkers you should avoid bringing them.

When the tour is over, visitors get to pan for gold. A miner offers a brief
demonstration. My children had fun dipping pans packed with sand into a water
trough, but again, the activity is more beneficial for schoolchildren than tykes.

Emily wanted to swim instead of pan, so she splashed her arms in the water
and proceeded to drench most of her upper body.

Meanwhile, her 10-year-old brother, Matt, was serious about panning and took
his time to search for gold and gemstones.

"It's wonderful," he said of the tour and the panning. "I like seeing what they did
back then. I think gold and rubies are cool."

Most people leave the mine with barely enough gold to pay for the visit. But my
6-year-old son, Tres, actually found a nugget. Hop Smith, one of the miners
who runs Consolidated, estimated the nugget could be worth about $50.

Don't worry about leaving the mine empty-handed. The gift shop has oodles of
rocks, fossils, semi-precious gemstones, gold nuggets, marbles and other
souvenirs.

And before you leave the area, be sure to check out the Gold Museum in
downtown Dahlonega and walk around the square. It has a cool toy store,
several Christmas shops filled with unusual ornaments, speciality stores with
offbeat what-nots and a fudge factory with homemade candy you won't want to
miss.

You should also drop by the Smith House, a popular restaurant with country
cooking that's served family style.

(Thanks To THE ATLANTA JOURNAL-CONSTITUTION And Fair Use For
Educational/Research Purposes Only.)
Leland
Here's ANOTHER (New) Place to Take the Children This Summer
Discovery Cove opens in Orlando


By Mike Schneider
Associated Press

ORLANDO, Fla. - Discovery Cove, SeaWorld's exotic new sister park
where guests can swim and frolic with dolphins, is more like an exclusive
private club than your typically crowded Orlando tourist attraction.

At this park, which opened July 1,
there are no lines. No turnstiles. No
waits.

There's valet parking and hotel-style
check-in under its thatched roofs.
Advanced reservations are required.

Best of all, there are no crowds,
since admission to the 30-acre park
is limited to 1,000 people a day. By
comparison, Orlando's major theme
parks at Walt Disney World and
Universal Florida can hold as many
as 50,000 people a day.

``Your day in Orlando can be real
hectic, going to theme parks. It's a
tedious day,'' says Frank Murru,
vice president and general manager
of Discovery Cove. ``We want to
get you out of that mindset, out of
Orlando and rushing to the next
thing.''

Don't call Discovery Cove a theme park, at least not to Mr. Murru's face.
Call the attraction a resort, perhaps, although there is no overnight
lodging.

But cheap it's not. Tickets go for $179 per person.

What you get for that price is a park where guests can swim with
bottlenosed dolphins in a lagoon, suntan on manmade beaches of white
sand, and snorkel with tropical fish and stingrays with clipped barbs in a
faux-coral reef.

Guests can also float down a river that runs through the park, passing
through a waterfall to visit an aviary filled with colorful, tropical birds, and
watch as sharks and barracudas swim behind a glass partition.

Visitors who don't want to swim with the dolphins pay $89 to get into the
Anheuser-Busch-owned park. Both admission prices include meals and
equipment and also allows guests seven days of unlimited visits to
neighboring SeaWorld.

Because it is more than three times
more expensive than other Orlando
parks, Discovery Cove will likely
appeal to wealthier visitors who may
be into ecotourism but prefer it in a
controlled setting.

``It's something totally different that will
attract a new segment of the market,''
says Abraham Pizam, a professor of
tourism at the University of Central
Florida. ``It's high time for Orlando to
start diversifying its product, otherwise
we will become a kitschy type of
tourism destination.''

The inspiration for the park came from
guests at SeaWorld, which had a
limited dolphin swim program.

``We had for years gotten comments from guests that while they liked
SeaWorld, we always had a barrier as far as touching the dolphins and
interacting,'' Mr. Murru says.

No more.

Upon arriving at Discovery Cove, a visitor gets an identification card
which allows the visitor to buy food in the cafeteria and rent the
snorkeling equipment, towels, chair and beach umbrellas. They are
assigned a time when they will have their dolphins swim and a human
guide who introduces them to the park. The guide shows them the
cabanas where they can change into their swimsuits and, if they're lucky,
fetches them a drink.

When it's time for the dolphin swim, guests in small groups are given a
pre-swim lecture by a trainer about what they can and can't do, dolphin
behavior and anatomy. In the water, the guests can be dragged by the
dolphins, hanging onto the animal's fin or by laying on the animals' belly.
Afterward, there is a post-swim meeting for any questions.

The park's 28 dolphins are carefully selected based on personality.
Discovery Cove officials are confident the interaction will leave guests
breathless.

``It's the awe of seeing dolphins up close and hearing them breathe and
seeing their eyes up close,'' says dolphin trainer Teri Corbet. ``People get
into this kind of bonding when a dolphin comes over to you.''

IF YOU GO: The Discovery Cove phone number is
877-4-DISCOVERY. On the Net: http:www.discoverycove.com

The phone number of the Orlando/Orange County Convention and
Visitors Bureau is (407) 363-5800. On the Net:
http://www.Go2Orlando.com/cvb.

(Thanks To THE AGUSTA CHRONICLE, And Fair Use For Educational/Research Purposes Only.)
CoBra(too)
The future's disturbing presence ...
Historically an era of extraordinary avchievements,hectic exploits of new technologies, is it IT or Biogenetics or is it just plain financial extortion by the fiat-$ suprematists,is usually followed by an era of calm, or is it simple tiredness - as MK's "dead" staggering home from the battlefields, looking for peace? Or is it maniacal, followed by depression, or is it progress, which looks increasingly like regress?
Our era seems to be looking increasingly into futures, becoming similar to the already present.To what future do we go from here?
Ever more similar monkeys, seemingly sporting similar gymnastics on their career and profit ladders, are seemingly caught up in the same treadstone of their own future's presence, created by media-, inernet and biogen wizkids. How many are there to keep up the information hype?

The silent Mainstreet still consists of a majority of confused, unaware, bamboozled into the total hock and slavery of the lavish credit availability of "Al(len)adin's"
worldof consumption. The forthcoming silence will be deafening - and only few will hear the clear comfort of a .999 proof gold coin.
Regards CB2


tedw
The Patriot
http://www.usagold.comAlthough I enjoyed the Patriot (despite some obvious copycating of a few scences from Braveheart), and I think it is much better than most of the propaganda being issued out of Hollywood,but I have a criticism.


It does indeed show the Patriotism, bravery, and love of
Goodness and freedom that was rampant at that time.What it doesnt show is that almost everything they fought for has been lost.

The Freedom they fought for has been lost.

Just in case you still think you are free, go look at the size of the check you gave to our socialist government via the IRS last year.
Usul
Leland... gold panning for kids
http://www.ccw.gov.uk/register/english/level1/dcothi.htmWhat a great idea! Although I have never been to the US or anywhere else with active gold mines, there are several places in the UK where kids can do "pretend play" gold panning (the setup uses bits of Iron Pyrites, or "fool's gold" instead of the real thing). My kids love it! Legoland at Windsor is one place; the National Coal Mining Museum in Yorkshire another; and, last but not least, the Dolaucothi Gold Mine in Wales (see link). By learning through history, a small spark of appreciation for the value of gold may be started in young minds. They may need to know much more about how to store wealth in something with intrinsic value in future years.
Leland
Usul, Your Words....
"By learning through history, a small spark of appreciation for the value
of gold may be started in young minds. They may need to know much more about how to store wealth
in something with intrinsic value in future years." are
EXACTLY the same as my thoughts...but YOU expressed much
more eloquently than I can do. Thanks!
Farfel
Winner, Best Post of the Year (@Kitco)

Date: Sat Jul 08 2000 07:35
ted butler (@The Call............... you know which call)
ID#317184:
Copyright � 2000 ted butler/Kitco Inc. All rights reserved
The participants - John Disney ( gold stock investor
and budding
lease analyst ) and Ian Muppett ( investor
relations vp, hedge manager and the only one in that
day ) .



Disney: Do you guys do sanitized loans or net loans?

Muppett: Huh?

Disney: Is the gold actually sold, or does it stay in
the vault?

Muppett: Huh?

Disney: Do you guys hedge?

Muppett: Who is this?

Disney: I'm a shareholder.

Muppett: Haven't you read our financials?

Disney: There're so many numbers.

Muppett: It's on pages 27 thru 79, and the footnotes
numbered 87
thru 1012.

Disney: Can you give me a bottom line number?

Muppett: Who is this?

Disney: I'm John Disney, I post on kitco.

Muppett: Is there anything else?

Disney: Can you guys pay off your gold forward sales?

Muppett: Of course. We're dedicating 27% of yearly
production of
our next 57 years production. It was at
26% of the next 62 years, but we just kicked it up
aggressively

Disney: Have you paid any back yet?

Muppett: Oh yes, plenty.

Disney: How much?

Muppett: Who is this?

Disney: Look, I'm trying to defend you guys. Just tell
me how
much.

Muppett: Well, we've had strong shareholder pressure,
so we paid
back 400 ounces.

Disney: 400 ounces? I thought you were short 15 million
ounces?

Muppett: We didn't want to - we had pressure. But we're
going to
pay it all back.

Disney: How?

Muppet: We are miners you know. We'll just take it out
of the
ground. It should be done smoothly, over
the next 57 years. A little at a time.

Disney: What happens if the price goes up dramatically?

Muppett: Huh? Who is this?

Disney: Doesn't it matter if the price goes up?

Muppett: If you read pages 87 thru 128 of our report,
you'll see
we win no matter what the price does. Up
is good. Down is good. Life is good.

Disney: But your share price is down 87% in three
years.

Muppett: I meant, life was good here at headquarters.

Disney: Wouldn't it be great if the CBs didn't have to
actually
lend the gold and just gave folks money at
1%? You know, cause it's incremental and all. And it's
just money
and the CBs got plenty anyway.

Muppett: Huh?

Disney: You know, if they just left it in the vault?

Muppett: I suppose - is there anything else?

Disney: Do you want to swap e-mail addresses?

Muppett: Who is this?

Disney: Just tell me this - would you like a loan at 1%
if the
gold wasn't actually moved from the CB?

Muppett: I suppose

Disney: I thought so, I was right. You know, I'm always
right.

Muppett: Is there anything else?

Disney: Do you think all the gold leases can be paid
off?

Muppett: Yes

Disney: Can I quote you?

Muppett: Who is this?

Disney: Look I have to prove someone wrong, can I
please quote
you? Look, we're both Souf Afwicans,
and this Merkin bloke is saying bad things about all of
us. Can I
quote you?

Muppett: I suppose, but try not to use my name.

Disney: Great. Say,do you like dogs? Can I tell you
some dog
stories?

Muppett:

Disney: Hello, hello

Muppett:



PS to JD - I see you're quoting Hathaway, you just
might learn
something. Quick question - the 2000 ton
loan to jewelry manufacturers - was that sanitized? Do
you think
they might have made some necklaces out
of 65 million ounces of gold? Or was it all rings and
earrings?
Don't tell midi.

TownCrier
Sir Leland's earlier mistaken atribution
http://www.users.dircon.co.uk/~netking/finan.htm#tquotnsLeland (7/8/2000; 1:24:20MT - usagold.com msg#: 33274)
@Netking
http://www.users.dircon.co.uk/~netking/finan.htm#tquotns
To the benefit of all of us on this forum, you deserve a
THANKS! for your many efforts to enlighten. Just in case
some don't know you, I'm posting your web site. THANKS AGAIN!
--------------------------------------
TownCrier's note:
While it is true that Sir Netking has earned appreciation from various posting efforts, the acolades for the assembly of this website that was cited belong to yet another fine individual who we are fortunate to have as a poster here...though it's not my business to say which one.

A clarifying note found on this link says:
---------
"I do not post as 'Netking' at the USAGOLD FORUM, (although I do post under a different handle). As far as I know, the poster 'Netking' has never made reference to this site. The 'netking' in my URL here is only used in my URLs (including, unavoidably, email).
+
My 'netking' URL at Direct Connection goes back to July 11th 1995, when I applied for a TCP/IP account. I had previously set up a page at http://www.homeless.com/ (who at the time had a free "home pages for the homeless" service) with the 'netking' name, although it was never developed beyond a simple page of links, and also set up a site, on June 29th 1995, at Hurricane Electric Home Page.
+
'Netking' is a name used by many today, but 5 years ago it was (apparently) unique for a while, until I discovered this site, set up by Tamir, Cohen (Jacobson) Advertising's NetKing portal: Yitzhak Rabin Condolence Page (set up in November 1995)
+
I also post occasionally at Kitco Gold Discussion for Investors and Market Analysts and Gold Eagle Forum - but never as Netking.
+
At the above-mentioned precious metal discussion fora you will find a broad range of discussions, from the trivial to studies in depth... and much in between. The posters there often post interesting links to contemporaneous news and market analysis as well as their own diverse personal thoughts."

I hope this helps clear up any confusion, and futher acts to assign due credit for this good effort. Everyone should have a look if they haven't already made a visit to this excellent site.
Leland
Now, if you Live in the Milwaukee Area (and you Hav'a dog), Have I got a Deal for you...
Pack the pup's tent: Feng shui for doghouses

By Corissa Jansen
of the Journal Sentinel staff

Last Updated: July 7, 2000

In the dog days of summer, Pam Paulson believes, canine lovers should be able to toss the pooper-scooper in the
trunk and bring Bingo along on vacation.

So Paulson and a group of dog enthusiasts are accommodating pooch owners across the country who are
frustrated over a lack of travel opportunities designed for dog and master alike.

At a lakefront site near Stevens Point, owners can bond with their pets at
impromptu campfire howl-alongs, costume contests in which both owner
and pet dress up, and get-acquainted "mixers" that organizers say are
nothing to sniff at.

The camp offers everything from hiking with your husky to
paddle-boating with your pinscher to learning feng shui for your
out-of-sorts Shar-Pei.

"It's like you're a kid again at summer camp. That's the whole idea," said
Paulson, of Waukesha, who runs Dog Days of Wisconsin Summer
Camp, which will enter its sixth season in August.

"The focus of Dog Days is to come and have fun, with your dog."

The Dog Days of Wisconsin camp is one of only a handful of retreats in
the country that cater to people and their pooches, Paulson says. Like
Dog Days, Camp Gone to the Dogs in Vermont and Dog Scouts of
America in Michigan also offer fully integrated programs for dogs and owners - above and beyond the more
prevalent camps designed exclusively for dog training or pet-sitting while owners are on vacation.

"What first got us going on this was that, obviously, we all have dogs, and we were frustrated that we couldn't
find a place for us to go with them and spend some quality vacation time outdoors, where our dogs were
accepted and we were accepted with them," said Stacey Balsley of Waukesha, a co-founder of the camp.

In its first year, Dog Days of Wisconsin housed about 40 campers and their dogs at Camp Helen Brachman in
Almond, a campsite on Pickerel Lake that typically hosts summer camps for kids. Since then, Dog Days has
grown to two camps each year in late August at Almond, each accommodating a maximum of 55 campers and their
dogs.

There is a waiting list for the first camp, from Aug. 18-21, and only two open slots left in the Aug. 25-28 camp.
Paulson is already taking reservations for Dog Days 2001.

"It's growing every year," Balsley said. "Pam keeps adding things to make it interesting."

For $380, campers check in on a Friday and stay with their dogs in cabins or tents until Monday. For an added
fee, campers also have the option to stay in two nearby hotels that accept dogs.

With restrictive pet policies in place at many hotels nationwide, dog enthusiasts say the camp is a rare
opportunity to vacation with canines.

"Let me tell you, I have never heard of one of these before, and I know dogs," said Bob Duffy, executive director
of American Dog Owners Association Inc., a Castleton, N.Y.-based group formed in 1970.

"That's fascinating that somebody would cater to people and their dogs and set up somewhat of a resort," Duffy
added. "There's certainly a ripe opportunity for these things to spring up elsewhere."

For now, however, Dog Days organizers are reveling in their relative obscurity, offering a variety of
doggy-designed activities. In "Barks and Crafts" class, owners can fashion leather leashes for their dogs, or make
a paw print by dipping their pet's paws in plaster.

"Those of us who don't have children, this is our opportunity to take home that plaster of Paris paw print," joked
co-founder Sue Ann McCotter of Milwaukee, who works as a staff photographer at the camp.

"We dog people are a different breed, all the time with our plastic bags in our pockets," McCotter said. "We just
really have a good time at camp. It's fun. Pure fun."

The camp culminates in a "Doggy Olympics" on Sunday afternoon, complete with limbo, tail-wagging and kissing
contests and puppy push-ups.

And at a costume contest, some owners' antics set tongues wagging. Last year's winners came dressed as Fred
Astaire and Ginger Rogers. The Great Dane played Ginger.

"The dog looked great, with a blond wig and a lovely gown with a diamond-studded choker," McCotter said.
"You couldn't help but be fascinated by these two waltzing around the stage."

Another winning couple came to the contest with their dogs dressed as Beatles, in mop-top wigs and Nehru
outfits, dancing to a soundtrack of dogs barking out Beatles tunes.

"I'm serious - these people go all out," McCotter said.

The mixers are held on the first night of camp, but the theme is kept secret until campers arrive.

"If I told you, it wouldn't be a surprise. Our staff members work so hard to keep it a secret," Paulson said, noting
that last year's mixer featured a birthday party theme.

New this year is "Feng Shui for Dogs," a tongue-in-cheek class modeled after a burgeoning new-age fad that
uses the ancient Chinese art of arranging furniture and surroundings to achieve a harmonious effect.

"We're teaching owners how to feng shui their dog's house," Paulson said.

Except at mealtimes - "The health department isn't real open to that," Paulson says - people are with their pooches
at all times, including the mandatory nap time after lunch.

Organizers stress that they don't take attendance at the events, and campers are free to roam the campgrounds for
one-on-one TLC time with their dogs.

"This is supposed to be a fun weekend," McCotter said. "It is a vacation, after all."

For more information about Dog Days, contact Paulson at (800) Camp-4-Dogs.

(Still Chuckling, And Fair Use For Educational/Research Purposes Only.)
ORO
German and French direct investment
Been to DC recently and took a walk round the Mall. New construction and older buildings for lease bear the names of European financiers, primarilly from Germany and France. Hypo bank and Dresdner bank putting up a new building on K street (if I remember right), while across the street is a two block set of properties with a French and German contact for lease arrangements. Around the corner is another building under construction, with US based agents and a German investor behind it. This would not be an issue had these not been the only two construction projects and the only major set of buildings for lease in the Northern Mall area (the two others being the Treasury building renovation and the Washington Monument - both government projects).

The point here is the return of unwanted dollar exports to America. The holders are trading dollars and dollar debt for real property in some very expensive areas. The projects are very conspicuous in both commercial and political significance (it being in Washington DC, just a couple of blocks from The Liar.

If you happen to be in an expensive and high profile city center in a major city, take a look at the big signs on construction projects. Jot down the Financiers, Investors, Architects, Construction Firm etc.. Look to see how many of the large projects are financed by European companies/banks/investors. Post your findings, if you like, and perhaps we can find out something from the statistics.
Bonedaddy
Black Blade, yes...
I am in the Powder River Basin. Nice of you to remember my past comments. I work in conventional oil and gas operations, but have a lot of friends in CBM. I'm trying my best to maintain my distance from CBM because it's the wild west up in Gillette right now. There are too many amateurs playing contractor and lots of people getting hurt on the job. Every friggin project in the basin is over budget and behind schedule. There's a shortage of labor, poly pipe, and compression. Since the coal beds must be dewatered to produce gas, there's water running everywhere and a lot of landowners are pissed. Lawyers are circling. The hours are gruesome and I'm a salaried type, so there's nothing for me to gain. It looks like "Katie bar the door" for the next five or six years and none of it is pretty. Since I'm a recovering workaholic who's trying to get back into hunting and fishing, CBM is no place for me.
Thanks for posting the follow-up article to my gas price post. Sometimes I wonder if I'm really witnessing this catastrophy in the making. The major news media seem to have an aversion to reality these days. You can bet they'll pick up on it as soon as the gummit starts blaming the bad ol' energy companines.
SHIFTY
PPU
Periodic Ponzi UpdateNasdaq 4,023.2 + Dow 10,635.98 = 14,659.18 divide by 2 = 7,329.59 Ponzi

UP 122.59 Ponzi Points from last week!

$hifty
Black Blade
@Bonedaddy
Sounds as though we may have some mutual friends. I have friends working in Gillette and Sheridan. I used to work for Meridian Oil on a couple of projects to the north in MT. Now I work in the Gold industry. Many geologists, engineers and drillers have left the mining and exploration business as the POG has dropped and many of those have vowed to never return. Some Nevada towns are beginning to look like ghost towns as homes are being abandoned to the bankers. I have heard about the dewatering problems. I have a friend who works for one outfit that prefers to keep the water in situ and use it to act as a source to pressure the methane. I suppose that they just tap into the appropriate coal seam (in the Fort Union Formation?) and stop. Like all natural resource businesses, every wants the luxuries of modern living, while at the same time they condemn those who produce the necessary materials. I imagine the the sharks (lawyers)smell blood and will circle around this feeding frenzy for years. It does look as though NG supplies will be seriously strained though as new NG powered electricity power plants are built. GE has a 3 year backlog on gas turbines, and more NG power plants are planned as new EPA regulations go into effect. Looks like the price of energy is set to rise significantly, and inflation to follow as costs are passed on to the consumer. Obviously good for Oil and gas, gold and anyone left in the gold business ;-)

BTW, everyone should take time off for some R&R. I just came back from a couple of days fishing in N. Idaho. View Yesterday's Discussion.

Netking
Town Crier
Sir TownCrier (33296)
Thanks for your kind words TC & for some clarification. It would appear my name has been cloned......but by an individual worthy of the Netking heritage!
As it would appear the two of us are in different countries this globe will be big enough for the two us!
regards
Netking



Leland
A Test on the U.S.A. (Answers at the Bottom)
Posted at 3:35 a.m. PDT Saturday, July 8, 2000

ISAAC ASIMOV'S SUPER
QUIZ


Take this Isaac Asimov's Super Quiz to a
Ph.D. Score 1 point for each correct answer on
the Freshman Level, 2 points on the Graduate
Level and 3 points on the Ph.D. level.

Subject: THE U.S.A.

(e.g., Who is credited with naming the country
the ``United States of America''? Answer:
Thomas Paine).

FRESHMAN LEVEL

1. This motto first appeared on the United
States' 2-cent coin in 1864.

Answer----------------------------

2. The first word spoken on the moon was the name of what city?

Answer----------------------------

3. R.L. Ripley, creator of the ``Believe It or Not'' series, called his
mansion ``Bion.'' Why?

Answer----------------------------

4. Which of the eight Rocky Mountain states is first alphabetically?

Answer----------------------------

5. Which state is considered the flattest?

Answer----------------------------

GRADUATE LEVEL

6. What is the largest state in terms of land mass with only one
representative in Congress?

Answer----------------------------

7. What state with only four of the same letters used in its name has the
longest name?

Answer----------------------------

8. What are the two metals used to mint new dimes?

Answer----------------------------

9. Jack McCall was hanged for shooting this man in the back.

Answer----------------------------

10. What was delivered in 214 crates to the United States from
France in 1885?

Answer----------------------------

PH.D. LEVEL

11. North Dakota is nicknamed the ``Flickertail State.'' What kind of
animal is the flickertail?

Answer----------------------------

12. What famous female melted and sold all the gold medals she had
won and then gave the money to charity?

Answer----------------------------

13. Name the two signers of the Declaration of Independence who
went on to serve as president.

Answer----------------------------

14. How many states joined the Union during the 20th century?

Answer----------------------------

15. There were five tribes in the Iroquois League when it was first
formed. It later expanded to six when this tribe was admitted.

Answer----------------------------

ANSWERS: 1. ``In God We Trust.'' 2. Houston. 3. It's an
acronym for ``Believe It or Not.'' 4. Arizona. 5. Florida. 6. Alaska. 7.
Mississippi (m,i's,p). 8. Copper, nickel. 9. Wild Bill Hickok. 10.
Statue of Liberty. 11. Squirrel. 12. Annie Oakley (shooting m edals).
13. John Adams, Thomas Jefferson. 14. Five. 15. Tuscarora.

SCORING:

24 to 30 points -- congratulations, doctor; 18 to 23 points -- honors
graduate; 13 to 17 points -- you're plenty smart, but no grind; 5 to 12
points -- you really should hit the books harder; 1 point to 4 points --
enroll in remedial courses immediately! ; 0 points -- who reads the
questions to you?

(Fair Use Protections Apply.)
RossL
Quiz

Leland

I scored only 15 points. Since I am a product of public schools, and also in the name of political correctness, I think that I deserve a dumbed down test to make me feel better.

Ross
Farfel
From Le Metropole: What is a GOLDBUG? (great analysis!)


Michael Reid
Melbourne, Australia
mreid@health.on.net
July 9, 2000

The Small Timer - a view from the investment coalface

Its been yet another week of dashed hopes for small time afficionados of gold. So what's new? Since the
heady days of last September/October there has been a steady erosion in the POG and we have witnessed
repeated retreats from the ( technically ) critical $292/3 level. Unquestionably there are more attractive
investments in terms of both capital appreciation and yield.

So why do those of us who, individually, have absolutely no influence on the market or have a contrived
trading strategy stick with it? Are we masochists? Hardly. There are much better ways to inflict
psychological pain upon yourself if you feel so inclined. Are we irrational? Some would certainly suggest
so but I think it is quite the contrary.

Clearly good old-fashioned greed is one of the motivations to stick with gold. Any objective assessment of
macro economics and the gold market supports the notion that gold is presently considerably underpriced
and set to correct - possibly violently. The weight of evidence presented by numerous commentators at the
contrarian oriented web sites favours the proposition that our current economic environment is
"systemically stressed" and unsustainable. Gold continues to move, for the most part, counter to what
would be expected from first economic principles. If one believes that in the wash markets are efficient, the
POG must turn at some stage. While this turning point could be months or even years away, it could be
next week. Accordingly, the very powerful "fear of regret" - of missing the start- keeps those who are
committed, in the market.

A reasonable response to the greed and fear of regret argument for small timers to stay in gold is: "well
why not just reinvest when the POG chart stabilizes in uptrend? Gold stocks will almost certainly lag the
POG chart and there will be lots of time to get on board. Unless you are in physical you won't loose much
by waiting at the side lines." Fair comment. Disciplined traders would almost certainly adopt such an
approach and more power to them. I suspect that many gold afficionados haven't adopted this strategy.
This is where "gold bug" psychology comes into effect.

For gold bugs it isn't simply a case of not being able to admit defeat and taking a loss - whether they
acknowledge it or not it goes deeper than that. Balzac wrote: "To live in the presence of great truths and
eternal laws, to be led by permanent ideals; that is what keeps a man patient when the world ignores him
and calm and unspoiled when the world praises him". This is the sentiment that drives gold bugs. Gold
bugs are quirky. They are modern day Aristotelians who have quaint notions of individual responsibility
and a profound distrust of "over-government". Occasionally this distrust may lead us astray; to see an
offense where none exists but more often than not Occam's Razor is right. To flippantly dismiss the
inherent skepticism of the gold bug as "conspiracy theory" does not undermine the integrity of the gold bug
argument, it simply serves to mark the commentator as an apparatchik of the establishment.

Gold to gold bugs is merely a manifestation of their libertarian perspective. Gold is the practical
representation of their disquiet regarding both institutional and contemporary moral authority. Gold is more
than a store of wealth it is a store of independence. It is a marker of limited faith in fiat currency, the life
blood of institutionalised/government authority. Further, in the context of today's market, investing in gold
is a repudiation of the current moral authority of "economic prosperity". At some level gold bugs recognise
that Mr. Clinton's and Dr. Greenspan's Goldilocks economy is akin to the parable of The Emperor's New
Clothes.

Sour grapes? A rationalisation for being involved in a nonperforming asset? Absolutely not. Being a gold
bug does not preclude other investing or speculating. The gold bug can cheer the Emperor's fine new
clothes as well as the best of them. It's just that the gold bug is under no delusion that the Emperor is not
buck naked. Rather, the above commentary is an observation, a justification if you like, on the psyche of
the thousands of small time investors in gold. Those investors who have a streak of individualism that
stands defiant of the prevailing culture of overarching malignant government and the modern welfare state.

Flashman's Law sates that "a man will always act in his own interest". For afficionados of gold that means
staying invested, at the least, until the next cycle turns. Our psychology won't permit anything else.
RossL
kidding
http://home.columbus.rr.com/rossl/gold.htm
Before anyone flames me for that last post, I was just kidding!

I am still intrigued by the gyrations on the euro and yen on the chart.
David Linkley
Currency Forecasts
http://www.mips1.net/mgcurncy.nsf/Current/852568D90037E834802569160022A5AF?OpenDocumentIt seems that not everyone who works on Wall Street believes that the dollar bull market can last forever. And not only do some highly placed experts believe the dollar is about to correct, they believe the plunge could be swift and deep.

From the Mining Web:

"The average 12 month forecast for the euro is 1.05 US cents and Alfonso Pratt-Gay of JP Morgan believes it could hit 1.08, a 13% rise from current levels."

"Latest US inflation data is disturbing and contradicts glib statements from Federal Reserve officials that there is no inflation outside oil prices," says Brendan Brown of Tokyo-Mitsubishi International. "What we are now seeing is a full 1% jump in inflation (excluding oil prices) over a period of a few months. Monetary tightening has simply matched a rise in underlying inflation, so real interest rates haven't risen at all."
RossL
David L

Your quote on the Euro:

"The average 12 month forecast for the euro is 1.05 US cents and...

I hope they mean 1.05 US dollars.

Ross L
TheStranger
David Linkley
How can you just disappear for 16 months and then walk back in here and start posting like nothing ever happened? Where have you been, Mr. Linkley? Your posts are very much appreciated by me and, I daresay, a few others.
David Linkley
FLASH - Barak Government Collapses on Summit Eve
http://wire.ap.org/?FRONTID=BUSINESSJERUSALEM (AP) � With stunning speed,
Prime Minister Ehud Barak's painstakingly
constructed coalition government collapsed
around him Sunday, threatening his ability
both to govern and to make peace on the eve of
a high-stakes summit with the Palestinians.

LINKLEY COMMENT - As Bill Clinton warns publicly of Mideast turmoil should the upcoming Camp David summit talks fail, the Barak government unexpectedly collapses in Israel.
schippi
Select Gold Chart
http://www.SelectSectors.com/agpm120.gif Select Gold ( FSAGX )
Is still within it's Upward trend channel.


FSAGX Is also outperforming the major Gold indexes.
http://www.SelectSectors.com/gldindx.gif
David Linkley
The Road to Riches
http://news6.thdo.bbc.co.uk/hi/english/static/road_to_riches/prog2/prog2.stm"Money is one of the most powerful forces in all our lives. But how did we become
money-makers? This landmark BBC documentary series travels through time and across
continents to chart the story of mankind's progress from primitive hunter-gatherer
to modern wealth creator."

Timeline Example:

"546 BC First Athenian owl minted: this coin becomes famous and
extremely long-lived. It is been welcomed across the Greek world as a
reliable form of money, much like the US dollar is in many parts of
the modern world."

LINKLEY COMMENT: It has been said that the invention of money made all other inventions possible. I you agree with that sentiment, you are going to enjoy the history of money at the link above.


"Coinage isn't the only form of money, but it's a
particularly powerful form of money and the Greeks
were the first people to allow coinage to penetrate
their society thoroughly." Professor Richard
Seaford, Exeter University

elevator guy
@David Linkley, or anyone
What are the likely outcomes of the collapse of the Barak coalition government?

If there is turmoil in the Mid-East, then war, or skirmishes at some level, seem possible.

Without forgetting the terrible pain and tragedy of such a turn of events, it is also timely to think of possible ripples through the fabric of current events causing some opportunities for the investor.

So what would the effects be? If trade is stalled, what is the greatest export of Israel? (I dont know)

What stock to short? What to go long in? What commodity will be affected, if any?

Of course, if things get bad enough to reach a crisis level, we all know gold will shine. But is this the only play?

All of this, of course, come from the mind of someone who has been indoctrinated by the Worlds Greatest Money Making course in comodities. (Where we are taught to find the commodity trading angle in any world, or regional events)

Kind of makes one feel like an ambulance chaser, but if there are things going to happen that I have no control over, then I might at least make a profit.

Those who look not for performing investments need not reply, you may remain in your caves.
Bonedaddy
Collapse of the Barak Government
When I first heard the news last week that Clinton had scheduled a new Mid-East peace summit, I was appalled. Does this man have the biggest messianic complex since Hitler or is his brain simply damaged by years of cocaine addiction? (Or both?) This region of the world has been a powder keg since Abraham had his second son. How did this "master statesman" not realize that his wreckless actions could further destabilize Israel's government? With Clinton, you always have to wonder what the ulterior motive is. Giving Clinton and his administration the benefit of the doubt, we can just conclude that no harm was meant and they are just incredibly inept. But a couple of other innocent acts of stupidity have consequences still pending.
1) By Christmas oil and natural gas prices which have more than doubled from last year will be a major problem for homeowners and industry alike. I realize that nothing is a CRISIS until CNN says it's a CRISIS, but it doesn't look good from here. Where was Clintons energy policy?
2) China has our nuke secrets. And aren't they in the process of signing new agreements with Russia's new militant leader Putin? Let's face facts. Chinese money bought the '96 election for Clinton by funnelling money through a bank in Little Rock. What did the Chinese get in return? Where was Clintons national security policy? (Oh yeah, they were saving us from the evil Branch Davidians.)
To put the icing on the cake: Now with energy prices more than doubled and still rising, Russia and China getting chummy, and Clinton decides to work on his "legacy" by fostering middle east peace! I really believe Bill Clinton has been out to distroy this nation from the very start. This would explain why he was visiting the Soviet Union while other men his age were serving their country in Vietnam fighting Soviet backed NVA. If the Republic can survive long enough to get him out of office and avoid electing his evil twin Algore, we had better try his red communist @$$ for treason.

Elevator Guy: You may want to go long another couple cases of 7.62X51 and a few more gold coins.

Regards, Bd
Gandalf the White
Cross your fingers !
Looks as if Spot the Dog is getting ready for another attempt at testing the top of the channel again. Up 50 cents on the Forex chart to $384 even, at the start of Monday in NY. -- BTW, the US$ is down a bunch on the NYBOT futures sez MRCI. -- Hey Goldfly, where is Spike ?
<;-)
SHIFTY
Gandalf
$384.00You said "Looks as if Spot the Dog is getting ready for another attempt at testing the top of the channel again. Up 50 cents on the Forex chart to $384 even, at the start of Monday in NY. -- BTW, the US$ is down a bunch on the NYBOT futures sez MRCI. -- Hey Goldfly, where is Spike ?"

I like your price better then the one I'm watching! :)

$hifty
Netking
Re: The Barak Government
I think a reasonable prediction will be more land given up from the West bank.......further conflict and alienation between the hard-liners and the moderates.
Barak is no 'turkey' and will still be a player in this, give them some time and watch the gunpowder get very dry before a new peace is negotiated.
regards Netking.

View Yesterday's Discussion.

Black Blade
More PM producer consolidation in the wings
Source: theminingweb.comAustralia's Normandy gains on takeover bid speculation



Normandy Mining's share price has shot to a five-month high as investors bet that the number one Australian gold miner could soon be the subject of a takeover bid.

The group's shares hit $A1.05 on heavy volumes last week to continue the recovery from the low of $A0.82 cents seen earlier in the year. A number of factors are at play but the stand-out issue is the takeover talk surrounding the stock. Investors have taken up positions in the expectation that Normandy would soon get caught up in the gold industry's global rationalisation.

AngloGold and the merging Gold Fields/Franco Nevada are the market's favourites to move on Normandy, currently valued at $A1.8 billion. Homestake also has its supporters.

Both AngloGold and Gold Fields have made clear that the Australian gold industry is a focus of their future growth plans. Normandy would be a worthwhile catch. Annual production is now running at about two million ounces and profits are strong. A good part of the strong profitability - between $A110 million and $A130 million is the consensus for the June year - is a result of the group's extensive hedging operations.

The extent of that hedging would be an issue for the likes of AngloGold and Gold Fields and could be expected to be wound back on either group seizing control of Normandy. The starting point in any bid for Normandy will be the fate of the 11 per cent stake held by Julian Robertson's Tiger hedge fund.

The fund is in the process of being closed, with the Normandy interest comprising one of the last strategic holdings to be sold off. Recent sales of similar strategic stakes by Tiger in United Asset Management Corporation and US Airways has triggered takeover bids for both groups.

Whether that happens in the case of Normandy remains to be seen. What is known is that Normandy itself has made itself more attractive for a takeover by tidying its corporate structure.

It recently moved to full ownership of gold mining assets in the Yandal region of Western Australia and is in the process of selling its magnesium metal and industrial minerals interests. The magnesium metal sale is by way of a free distribution to shareholders of shares in Queensland Metals Corporation (QMC). Based on QMC's current share price, the distribution is worth about $A0.10 cents a Normandy share.

An announcement on the sale of the $A150 million industrial minerals business is also expected soon. Despite the simplification of the corporate structure, analyst's opinion on the value of Normandy continues to vary from as low as $A0.60 cents to more than $A1.35 a share.
By: Barry FitzGerald

Black Blade: Normandy is extremely hedged, and that could be a real problem. Somehow, I don't see Goldfields being all that interested. Maybe Anglogold since they are heavily hedged (~48%) wouldn't mind since they are unlikely to be able to significantly unwind their massive hedges anyway. As it is, in light of the hedging fiascos of Ashanti and Cambior, and if the POG should rise sharply, the Normandy could be as unwelcome as a turd in a swimming pool.
Topaz
On the "Spot" Musings...

The latest B.T.(remember them?) commmercial on the Telly over here shows the "talking head" enticing prospective investors by the following Logic :- (condensed)
"Imagine if the prices (and fluctuations in) the Housing Market were broadcast for all to see on a daily basis. (a-la Stocks etc) The entire population would be then emotionally affected when their home values were rising/falling and the Elation/Depression mood changes in the public at large would cause havoc".
The tacit message is:- Don't worry-be Happy and let B.T. do day-to-day investment management right for YOU!
How true is the above when considering POG?
Daily--even Hourly we check the charts and our relative mood changes if the sucker is going up/down, or impatience sets in when the price is range bound. Even "knowing" the whole shooting match is an ellaborate (sp) Ponzi sham fails to prevent these persistant mood changes.

Perhaps a Goldbug support anteroom in the Basement is in order Townie!

Topaz
...and in a similar "vein"
Let's spare a thought for the "long-term Goldbug" who, after 25 odd years accumulation ie: all the way down, departs this earth (recently) and from "we know not where" views his Will beneficiaries making haste to the Gold Dealer, cashing in Pop's chips- putting the "Money" to good use.
How his Heart (or Soul) must ache!
(MK crosses paths with these types on a regular basis, No?)

I hope & pray not too many more "Pop's" have to suffer so.
Black Blade
Morning Wakeup Call! The War Continues, but Battle Lines Static!
Source: Bridge NewsTHE EASTERN FRONT:

Asia Precious Metals Review: Gold stable after supported at $282
By Hiroyuki Fujiwara, BridgeNews

Tokyo--July 10--Spot gold was stable on Monday in Asia after prices found a support at about U.S. $282 per ounce on Friday in the U.S. market, dealers said. The U.S. dollar/yen's slip sustained spot gold today, while players were hesitant to decide price directions towards the U.K. Treasury's auction scheduled on Wednesday, they said. Platinum was steady on short-covering despite massive profit-taking, the dealers said. Expectations of buying from physical dealers below the key $282 level underpinned spot gold prices here in the sluggish market, the dealers said. The dollar/yen's weakness was extended in the afternoon due to the stronger than expected Japan's private machinery orders in May, however, some dealers expected gold prices could stay between $282 and $285 in the near term.

Black Blade: The battle lines appear to be static ahead of this Wednesday's "Brit gold give-away"

THE WESTERN FRONT:

Europe Precious Metals Review: Gold flat around $284, thin trade

London--July 10--Spot gold wandered quietly in a U.S. $283.50-284.50 per ounce range Monday morning in light trade, although managed slight progress towards the upper end of that range as the morning wore on. Dealers said further room was limited on the upside however, due mainly to the depressed sentiment ahead of Wednesday's Bank Of England gold auction. Silver lay dormant in a $4.95-5.00 range, while platinum and palladium held at overnight levels. (Story .2270)

Black Blade: European trades continued to hold a static battle-front. PGMs are still looking good as rumors of Russian sales have largely been discounted as nothing more than rumors until the actual metal is unloaded from the "planes, trains, and automobiles" so to speak. The Russians have cried wolf once too often.

AFRICAN AND AUSSIE FRONTS:

S Africa Press: No decision yet on Gold Fields Toronto listing

Johannesburg--July 10--A decision on granting Gold Fields, the South African mining company, approval for its proposed Toronto listing as Gold Fields International after last month's proposed merger with Franco-Nevada, was far from being finalized, Business Report reports Maria Ramos, the director-general of the department of finance, has said. "We have not, by any stretch of the imagination, taken a decision on Gold Fields," she said. (Story .12335)

BRIDGE FOCUS: Normandy shares fall, but hopes for takeover remain

Melbourne--July 10--Hope that Normandy Mining Ltd. will be swallowed up by an overseas mining house remained strong Monday, although profit-taking following recent gains pushed the gold miner's shares lower, analysts said. (Story .11630)

Black Blade: As posted earlier, "Consolidation" is the name of the game. SA Golds are looking to acquire foreign Golds faster than Rosie O�Donnell can rip through a case of Ding-Dongs. I would look for more news and confirmation of recent acquisition rumors fairly soon (this week).

Meanwhile, S&P Futures are down -0.20, fair value up +1.64 indicating a mostly neutral open on Wall Street at these levels. Au is up +$0.060 at $284.20, Ag is up a penny at $4.96, Pt down -$3.00 at $544.00, and Pd down -$.2.00 at $652.00. Oil is down $0.31 at $29.97/bbl in spite of the fact that OPEC is still unsure whether the Saudis will be permitted to increase production. Wouldn't matter as refiners don't want to hold inventories with their razor thin margins and no room to increase refining capacity. The only increase in supply now would be if the Saudis began cheating, something that they worked so hard to end at the major OPEC meeting in Vienna.

Black Blade
A funny thought! (I've really got to stop drinking this early)
Wouldn't it be a kick, the US floats bond and treasuries to the rest of the worlds markets. Then closes the window (defaults) exclaiming "thankyou for paying your WWII loans and reparations with interest! Now go away!" The shock and outrage would lead to some funny spirited exchanges I'm sure. Plenty of fodder for professional comedians I'm sure, but after all, "it's for the children"
wolavka
dec gold
opened on fridays high, time to rock and roll
Black Blade
PMs up across the board.
http://www.kitco.com/market/Can it be? PM markets look a bit frisky on NY open. Could we maintain momentum here? Nah, BOE doesn't deserve a higher POG this Wednesday ;-)
Black Blade
Oil and Gas Rig Count numbers
http://www.quicken.com/investments/news/story/bw/?story=/news/stories/bw/20000710/a2001.htm&symbol=BHIThe number of rigs in operation have increased substatially. The link provides the data.
wolavka
time
for cow to jump over the moon.
SHIFTY
Wolavka
He can't jump Goldman Sachs broke his legs!
SHIFTY
Wolavka
We need a large catapult !
:)

$hifty
USAGOLD
Today's Report: ". . . A New Cycle in International Monetary Affairs"
http://www.usagold.com/Order_Form.html7/10/00 Indications
�Current
�Change
Gold August Comex
285.30
+0.70
Silver July Comex
5.05
+0.02
30 Yr TBond Sept CBOT
97~13
-0~07
Dollar Index June NYBOT
106.90
-0.44


USAGOLD Market Report (7/10/00): Gold moved slightly higher
to open week. Most of the action in gold in the weeks and months
ahead could feed off dollar weakness with a growing number of
investors and analysts having formed the opinion that we have just
now reached the top for the dollar market. We have said many times
in the past that the key to gold is how the dollar stands up to
the pressures building globally for an adjustment in relative
currency values, particularly the euro. From the Mining Web: "The
average 12 month forecast for the euro is 1.05 US cents and
Alfonso Pratt-Gay of JP Morgan believes it could hit 1.08, a 13%
rise from current levels." (Thanks to David Linkley at the Forum
for digging this up.) The latest Grant's Interest Rate Observer
arrived over the weekend and it made a dismally hot weekend better
by stating: "The thesis of this full length feature is that
misplaced confidence in the dollar-centered monetary system will
provide impetus for the start of a new cycle in international
monetary affairs. There is nothing necessarily apocalyptic about
this vision. Rather, the now latent demand for a store of value
will become manifest, and the demand once it appears, will be
satisfied at the margin with non-dollar assets, including gold."
And its not these opinions are built on a flimsy foundation. To
the contrary: "Latest US inflation data is disturbing and
contradicts glib statements from Federal Reserve officials that
there is no inflation outside oil prices," says Brendan Brown of
Tokyo-Mitsubishi International. "What we are now seeing is a full
1% jump in inflation (excluding oil prices) over a period of a few
months. Monetary tightening has simply matched a rise in
underlying inflation, so real interest rates haven't risen at
all."

This week we have the bi-monthly Bank of England gold give away on
Wednesday (bring a friend), Producer Prices on Friday and the
meetings between two lame ducks and a would be president begins
tomorrow. As we go to fetch this over to the server, oil is
predicting a non-reaction from the Gulf states -- dipping back
below $30 on the August contract; the dollar is is taking a fairly
notable hit versus the yen and euro; and, the stock market is
struggling as it has been for the past several months.

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

An Invitation:

I would like to invite those who take an interest in the type of
analysis read here to give our newsletter a try -- News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals. This month we focus on oil and inflation. Many
analysts and investors think there very well may have been a
fundamental shift in economy that could favor the gold market and
hammer the equities and dollar market. These opinions from various
sources are covered in some detail in the upcoming July issue.
Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The package is
offered at no cost or obligation. You can call Marie at
1-800-869-5115 to request the newsletter and Almanac or
click above.
wolavka
B.O.E.
Already in the mkt. Dec gold holds here above 287.00

Auction is a joke, points of resistance , 295 298 300 303.

So I'll just sit and wait till you gap the open over 303 in the next few days, (comex bad boys)
wolavka
history
public television tonite, THEIR FINEST HOUR, Battle of Britain, good timing .

Clinton should have taken some lesson on cigars from churchill . Fine cigar is like a woman, gotta lite em up before you smoke um .

wolavka
locusts bad in texas
Watch grains now possible bottom. meats and cotton.

gold will have alot of company on its way up.
Golden Truth
Wolavka
Wolavka you're funny, i laughed so hard, i started to cry!
P.S While i,am at it GOLD "will now rise" because i said so. Should familiar?
Journeyman
Loan-out your gold to the newest bullion bank -- MONEX!

Just caught a MONEX commercial on CNBC soliciting your gold to be loaned out for interest, etc. You can also "buy" gold from them and leave it for them to gamble with for you. They don't quite put it that way of course. They offer 5 to 1 leverage which "will multiply the market movements." Implication was, naturally, that they would be upward movements.

Don't send it to them all at once, now!

Regards, J.
TownCrier
Changes at Switzerland's central bank, other CB news
http://www.usagold.com/centralbank/current.htmlFrom USAGOLD's latest edition of the Central Bank Insider page...

"Hans Meyer, the Chairman of the Swiss National Bank, announced that he would retire at the end of this year, but did not say who would succeed him at the high-profile helm of Switzerland's central bank. Meyer was long expected to step down next year when he reaches the mandatory retirement age of 65, but opted for a slightly earlier departure to make the transition as smooth as possible, an SNB spokesman said."

Hmmmmmmmmm...we wonder why the transition would be any smoother by doing it THIS year instead of NEXT year. (??)

And here's a real-world example pointing up the fallibility of national (bank) currency as a store of wealth instead of the natural alternative (gold):

"The Supreme Court in Ecuador has ordered the arrest of nineteen bank officials implicated in the collapse of the Filanbanco bank last year. The government took it over and pumped more than one-hundred million dollars into it. The officials, some from Filanbanco and others from the Ecuadorean Central bank, are accused of misuse of these government funds. The banking system was thrown into chaos in March 1999 when the government ordered a closure of all banks due to a crisis of liquidity. Since then, the government has intervened in three-quarters of the banks operating in Ecuador."

In other news, a paper by Professor Martin Feldstein on Self-Protection for Emerging Market Economies concludes that "reserves reduce the chance of currency crises. They reduce the chance of attacks from speculators and allow an orderly adjustment of internal imbalances."

No big surprise there, wouldn't you say? And as far as the cost of holding these reserves, he said it must be evaluated against the cost of having a currency crisis. Chalk one up for the professor.

He also says that the IMF does not have enough capital to be the international lender of last resort. It's just as well. History shows that didn't work so well anyway. Rather than allowing a perpetual refinancing or rollover of debts, it would likely have been much healthier to allow the default and to let the financiers take their lumps.
TownCrier
Gold and paper within the ECB reserve model
The passing of the second quarter on June 30 signalled that it was once again time for the European Central Bank to revalue their massive gold reserves, marking them to the new market value per ounce (based, I believe, on the London PM fix of that day) at which value they will be carried on the official books until the next quarter arrives.

The outcome? According to last week's financial statement, with no net changes in quantity of gold held by the Euro System of Central Banks, the total gold assets of the ECB enjoyed a gain in value of 5.511 billion euros, raising the valuation to 121.188 billion euros.

As for their net paper foreign exchange reserves, the same weekly financial statement showed a decline of 500 million euros in value from the previous week.

This is an asset model that can be duplicated with benefit on any scale from national to individual. You can surely see why the official sector of Euroland no longer would derive a benefit from or hold an interest in maintaining the illusion of artificially low gold valuations.

From the standpoint of the U.S. dollar, if you think about it, you will see that the advent of such things as COMEX gold contracts are the psychological equivalent to the tricks banks used in the "old days" to attempt to stave off an imminent bank run whereby they would take cash from the vault and make piles near the tellers to create the false illusion of abundance. Although there is a fine line between illusion and reality (if the illusion works, it defines the "operational/behavioural reality" for yet another day), when the illusion fails, behaviour will quickly adjust to respect the true reality. There is far less gold available than the banking and derivative illusion would have you know.

Woe is he that turns aside from his prudent position in the bank queue because he was comforted at the sight of the cash piles, only to discover hours later that the bank failed (along with his account) when no one else behind him was as easily duped.
TownCrier
The U.S.S.A. ?
Are we entering a new era in America, Soviet style? The degree to which the Feds act to plan or mangage what should be private business affairs is quite disturbing. Here's the latest example from Bridge news...

The background: While Saudi Arabia suggested they could increase oil production to prevent further price rises from curbing global economic growth, their OPEC partners would not act alone...meaning they all increase production, or none do. To that end, they said it was too soon for yet another production hike, having increased production by 708,000 barrels per day just four weeks ago.

Against this backdrop, Bridge News reports that President Clinton is "acting to create a 2.0-million-barrel heating oil reserve in the Northeast to cushion the region from excessive price spikes linked to a combination of tight supply and cold weather." The method for this announced by the Department of Energy is to swap crude oil from the Strategic Petroleum Reserve in order to build a similar reserve for heating oil in the Northeast by October. (And while the president has the authority to establish such a reserve, it would require congressional authorization to release the heating oil unless an emergency were declared.) Within two weeks the Dept of Energy is expected to solicit offers from companies willing to participate in the swap. Bridge reports that it is unclear at this time how much oil will be taken from the Strategic Petroleum Reserve.

If there were an opportunity to make a buck here, wouldn't it seem that private corporations would be falling all over themselves to ensure that they could effectively and effeciently meet the expected demand? To have the government stepping in time and time again effectively creates a moral hazard...we come to expect a safety net in all matters and therefore fail to act prudently in many regards. Faith in national currency to store ones wealth is another obvious example of this.
TownCrier
Speaking of things soviet...
Bridge News also reports that the Trust and Investment Bank of Russia announced today that deals were concluded for them to purchace eight tonnes of gold from domestic producers...an increase by 60% over last year's gold purchase by TIB. The director of their Precious Metals Department said also, without specifiying a precise figure, that they would buy "at least the same amount of gold in 2001 as this year."
Ulysses
Town Crier
http://www.usagold.comWould it be be better to let folks freeze in the Northeast because they can't afford the high price of heating oil? That would seem to show the limitations of a free market.
JavaMan
Ulysses
http://www.mises.org/freemarket_detail.asp?control=176&sortorder=subjectYes it would...if it was a free market.

"The current oil scarcity is an artificial creation of politics and is easily corrected. We could loosen environmental laws that prevent drilling, we could repeal all taxes, and we could eliminate the pointless embargo against Iraq, which should have been ended long ago on both economic and humanitarian grounds. That these obvious options have not been raised by anyone, Republican or Democrat, is a frightening testament to the power of the government-connected corporate elite to control the political debate in this country."
Aristotle
For those suffering from "FOA or Trail Guide withdrawal," this might help
This was a real treat. I was doing some archive browsing when I came upon this post from one year ago. It is more relevant today than ever, particularly in consideration of the gist of the message in the #33337 TownCrier post on the ECB's reserve model and bank runs. I especially liked the evolutionary aspect FOA draws attention to. I hope the past 12 months of discussion and events helps everyone to gain a firmer grasp on the importance of this post. For reasons that I'll give later, my strongest impression is that July and August of this year will mark the end of the physical market as we know it--that is, availability at prices that closely track the cheap derivative-determined prices.

Gold. Get you some. ---Aristotle
-----------------------
FOA (07/31/99; 17:29:43MDT - Msg ID:10016)
various thoughts

What is a "natural market" as opposed to a "manipulated market"? Do people really think that the only true natural markets are where every owner sells everything he can at whatever price current demand will bring? Like wise, every buyer buys all he can use at whatever price current supply will provide? When I read some of the philosophical reasoning presented on the net, I get the distinct feeling that the human factor should not play a part in the marketplace. In other words, anyone that holds off from buying or selling, waiting for a better price, is helping to manipulate the market. Has mankind lost sight of the fact that for a human marketplace to be "natural" it must show the imprint of "ulterior motives" in it's trading price! Yes? No?

Say, I am a big time oil owner and considered not to sell any of it. One day I decided to pump 100 million barrels into a giant tank. I'll just hold it there with the intent of selling it later at what I considered a better price. Am I manipulating this commodity? Or do my actions present the "natural" greed and fear that must be present in a human marketplace? Perhaps, I do not feel that the present world dollar prices of oil, gold, copper, cotton or corn, truly represent the "human use value" this currency reflects. If others think that fiat currencies offer the "natural" values that "supply and demand" create, do I have to sell to escape their damnation of my intent? Is it manipulation because I play all factors into my reasoning? I do consider that, usually these "critical" voices come from "economies" that are already receiving more production value per barrel than the dollar price can reasonably repurchase in real things. It's like the carpenter that is making $.05 per hour on a government job and his manager tries to convince him that is all he is worth. We should not blame the manager for taking advantage of the system? In the same light, nor should we underestimate the ability of Western economist to justify the "supply and demand values" of oil as expresed in dollars. Their readers are coming out ahead, just as long as supply and demand is settled in "their" dollars, that is!

Some even profess that world trade must "play by the rules" and deal in a spirit of honesty . But, what are these rules? And what is honest in our world trading system?

The present world banking operation creates a monetary arena that demands everyone to settle the transfer of all goods and services in a "fiat money" system. One that is clearly "manipulated" to the advantage of each country. The Japanese wrestle the value of the Yen to promote their trade advantage. Every country has it's "behind the scene" method of "interfering" with the way world trade sets the value of it's currency. Do not the actions of these countries truly reflect the needs and wants of their working populous? Even if their motives are, by design, manipulation, they do this with a perception to help their citizens. Even with this view, we see the imprint of "human nature" in world trade, as it's always been.

My point is that "manipulations" are a large part of modern trade valuations. Under a fiat monetary system, it is a "natural" tendency to hold for "your best terms" because the value received in paper currencies is always changing. Just look at 1985, when the G7 plunged the value of the dollar. What was that? Honest "value reduction" in a currency, "new rules to play by" or just a plain old natural response to a modern world?

So why do so many search for and cling to reasons that cannot apply in this current trading market?

A lot of people have been caught holding the wrong "outcome opinion" on this gold dollar thing. Just as in the above analogy, many "Western economist" that analyze the gold market also use a "western dollar perspective" to advise the same conclusion. That being, because we cheated the rest of the world to maintain our lifestyle, we are due for a little inflation and loss of dollar value. So, lets compensate by buying some gold, leveraged gold paper and gold stocks to retain any of our lost wealth.

Well, it just isn't working out that way, is it? You see, that "perspective" is based upon several concepts that we have "evolved" past:

1. "The repeat of the 1970s international currency panic."

That panic never ended and is in evolution into this day! The dollar reserve system has been patched up with debt and more debt over all these years. It was maintained because, prior to the Euro there was no other alternative to go to without shattering the world economy "completely".

2. "A 70s repeat of a rise in gold prices in dollars, at least back to the $400 or $500 range."

That gold bull of the 70s was a controlled burn! Contrary to every thinker, they allowed gold to be sold into the market to take the pressure off the dollar. As the price rocketed, it was easy to see that only a tiny fraction of the dollars held overseas would ever be exchanged into gold at any reasonable price. To fully complete the deal would have seen gold in the many thousands. The rising gold price sealed the fate of the world into using dollars in settlement. In effect they said, raise the prices of oil (and anything else) but you must settle trade in dollars. The USA would then write IOUs to everyone on the planet in order to keep the system going. In effect, to the world, stop buying physical gold, put the dollar on an oil standard, through dollar only settlement and "gold " will be priced to your advantage in a different venue.

Remember, in those days, they did not have a functioning "derivatives" market for gold. The only method of manipulation available was to allow it's price to rise in open auctions, well before any major portion of "foreign" dollars were exchanged. Stopping the auctions put gold back undercover. Falling gold prices kept the dollar on an oil standard until alternatives could be worked out. It "IS" a different game today!

3. "The continuation of a world gold market, expressed and settled only in dollars."

Few people ever factor in what would happen if the London gold market stopped trading gold. It's a "given" among "Western economist" that this is "the way it is" and could never change. If the IMF/Dollar gold market ever failed all gold trading would revert to physical, immediately!

The amount of gold held around the world in paper "derivative" form is enormous. It dwarfs any reasonable estimate I have seen. Every analyst that expresses current supply and demand for gold as under 5,000 tons per year, truly doesn't have a clue. London moves that much "demand" around in a week. Much of it in the modern world form, "derivatives". It is in this massive new market that gold ownership has exploded without spiking the price. On the contrary, this market created the falling dollar price of gold as a function of "maintaining a dollar reserve system".

Without this new form of gold market, a rising physical price would have destroyed the dollar well before the Euro could be established. However, within this paper gold system lies the ultimate self-destruction of the dollar and the destruction of the entire gold industry that relies upon the LBMA for settlement.

If one buys into any dollar based venture today, he is making an assumption that the Central Banks of the world stand ready to maintain this currency as the current world reserve. An assumption, that I believe will cause a major loss of wealth as this plays out. Today, we have "evolved" past the need to keep the dollar "above value" in terms of real things.

Forcing foreign trading partners to take on more dollar debt in an effort to maintain the credibility of past debt is destroying the world economic system. In the past, a US trade deficit provided a home for dollar reserves outside it's local market. Because these "foreign held" dollars were held as backing for other currencies, they expanded the international monetary base during a time of increased world trade. Through out the 80s and 90s, as the American inflation of it's currency threatened several financial blow ups, this system still offered the only logical alternative.

Today, competitive devaluation's of foreign currencies is changing the "old expanding" qualities of the US trade deficit. The same dollars, once sent to buy "overseas", are now contracting the very currency systems they once backed. These economies no longer earn a "return on commerce" large enough to generate enough dollar reserves. Truly, the more Americans buy from their failing trading partners, the more their local currency systems contract. Generating the need for more IMF induced debt. Debt in the form of dollars that flow back into servicing old debt without creating new money. An endless circle that points to the end of using dollars as reserves. Clearly, this new era has sent the IMF / dollar supporters searching for every form of liquidity expansion possible in an effort to buy time.

This is the expected outcome from using a patched up reserve system, built upon an ever higher mountain of debt. The effect creates lower buying costs (price disinflation) in the currency host country (USA) as it destroys foreign financial holdings by building debt into the balance sheets without increasing real assets. The only countries that can escape this fate are ones that can insulate their trading block with a new reserve asset currency (Euro) or have "commodity assets" large enough to back entire currencies (oil).

It is this "deflation" draw down in world trade that will force the removal of the dollar as the settlement currency in international transactions. The modern evolution of events clearly show that no other path can be taken. It is well within the authority of the BIS take this route. It is a reaction that the dollar has brought upon itself from the early 70s decision to drop gold.

The moment that this event transpires, the global deflation of dollar financial holdings will change into the hyperinflation of all local US assets. The exact same fate awaits every country that has tied it's economy and treasury to the dollar. A process completely out of the hands of the Federal Reserve and one that will require "intense foreign exchange controls"!

I suspect that the gold market, itself will signal this event long before it's arrival. All or some major players in the paper gold market will pull away from it's use and create a void on the buy side of the trade. A logical point because the dollar gold contracts could never settle physical gold at the price a "non reserve" dollar would produce. As I said before, this could destroy the current mechanics of the world gold market and could plunge the paper price as the trading market fails. Another gives this good odds, I don't? I think (and have prepared for) a financial event, that triggers the withdrawal of dollar users and forces a physical bidding war beyond the confines of the current gold market. Either way, the dollar price of gold will soon soar as London is removed from the gold window!

In reply to Carl, I also think that gold mine stocks will (in some way) suffer as they are locked by their local governments, into selling gold at (new) controlled prices to honor dollar credits. Also, most all of them will, no doubt (in all the confusion) be trading otc options and futures in current dollars, not to mention their gold loan repayments. I hope you are right in that they are smart enough to wiggle through this. FOA
JavaMan
Aristotle...
Ahhh...thanks for the "fix". I'll bet there has been a spike in the rate of hits on this site as a result of your closing sentence. I await with great interest.
HI - HAT
Back To The Future
Just got back from 3 days of up in St. Augustine, Florida.
Ponce de Leon came ashore here in 1513, and claimed all of Continental America for Spain and named it La Floridita.

Lots of Historical stuff there and I highly recommend going.

At the gift shop next to the "Oldest House", (1565), they had sample pacs for 1.29$ of various paper money from continentals and cival war periods, etc.

Further on up at the "fountain of youth", they had displayed under glass lots of gold Doubloons and pieces of eight retrieved from wrecks off the Florida coast. No sample pacs of these however, and they looked real "good".

In following the chronology of events of over 4 hundred years in St. Augustine one comes away with the feeling that things can change real quick. We could be on the verge of one of them right now. In fact it might be the MOTHER of all changes.

Get your Doubloons and pieces of eight while the ship is still floating.
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 7, 2000

Rates for Thursday, July 6, 2000

Federal funds 6.51

Treasury constant maturities:
3-month 6.02
10-year 6.05
20-year 6.27
30-year 5.91

upside-down spread FF vs long bond = (0.60%)
THX-1138
comment on heating oil shortage
With the heating oil shortage causing high prices, wouldn't it be more cost effective to switch to a coal fired furnace.

If I was still living in Fairbanks, Alaska, I would probably consider switching to coal. Just rent a dump truck and go down to the Healy Coal Mine and see if they will sell a truck load to you, then driving it back and dumping a couple years supply in the back yard.

How much does a yard of coal sell for?


P.S.: Going to a family reunion in Idaho, and was wanting to know if someone knows a nice place to gold pan?
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 10, 2000

Rates for Friday, July 7, 2000

Federal funds 6.42

Treasury constant maturities:
3-month 6.04
10-year 6.01
20-year 6.23
30-year 5.87

upside-down spread FF vs long bond = (0.55%)
TheStranger
Whistling Past The Trinity Church Graveyard On A Summer Evening
It being Monday, and my having just perused another round
of weekly Wall Street research, I thought I might share an observation.

Nearly all of the major strategists have been stymied lately by the appearance, at least, of some slowing in the economy. Nobody(including me, of course) knows for sure whether these recent signs are aberrant or whether they point to softer business conditions down the road. But, this week, it is clear that the guessing has all begun to lean in the same direction. To wit: there is little or no systemic inflation, the Fed wants to slow down the economy to keep it that way, and recent reports of flagging growth probably mean the Fed is succeeding.

Well, I am not buying. It seems that, no matter how thoroughly experience has discredited the Phillips curve, analysts still choose to believe in it when they want to. They would be wise to remember this, that even if recent softening in some economic indicators prove portentious, growth and inflation are NOT the same thing. In fact, perversely, slower growth may have even helped the price of gold last month by staying the FOMC from another increase in interest rates. And now, many forecasters believe the August meeting won't result in an increase either.

So, you see, the slightest hesitation in the economy, and the battle against inflation is supposedly won. But don't you believe it. We still have $30 oil(or thereabouts), we still have $4.50 natural gas (or thereabouts), we still have 4% unemployment(or thereabouts) and we still have a $30billion monthly trade deficit. By giving up now, the Fed
would be saying, "we see that price and wage pressures are present, but because we are afraid of starting a recession, we no longer have the courage to act."

Well, I am sorry boys, the task before you may be an ugly one, but it is your task to perform, and, in the end, there will be no painless way of avoiding it.
SHIFTY
THX-1138
IdahoIf you know what county you will be in I could tell you your nearest place to go panning.
Gandalf the White
Howdy there Stranger !
This item was picked from S. Kaplan's GOLDMININGOUTLOOK.COM page from a few days ago. Does this look like the Horseman with the BIG RED "I" on his hat is wasting away or getting stronger?
<;-)
====
GAUGES OF FUTURE INFLATION:
The Economic Cycle Research Institute (ECRI) future inflation gauge (FIG) for June, released July 7, 2000, was at 123.1, up from 122.6 for May (downwardly revised from 122.7). Its smoothed annualized growth rate fell to 7.5% from 8.3% (revised downward from 8.5%).
---
Gandalf the White
AND another one, Stranger
GAUGES OF FUTURE INFLATION:
The Foundation for International Business and Economic Research (FIBER, formerly known as the CIBCR) monthly leading inflation index, released July 7, 2000 for the month of June, was measured at 102.9, up from 102.6 in May (upwardly revised from 102.3).
<;-)
SHIFTY
Gandalf
I have heard that high fiber is good!
:)
$hifty
Gandalf the White
SHIFTY
http://www.forextrading.com/forexartists/page1.htmHere is the place that the Hobbits watch the paint dry. -- ADD GLD= to the blank upper left rectangle and hit REQUEST.
Spot is now at $283.40 which is USUALLY the same shown on
http://www.thebulliondesk.com/
AND yes, eating those green FRN's is fun!
<;-)
ORO
Howe's Paris update
http://www.goldensextant.com/commentary13.html#anchor3944Howe's summary is interesting in itself.

"Summed up briefly, my principal impressions from the conference were: (1) the ECB and its 11 member central banks do not have a common policy on gold, which remains almost entirely subject to national control by the individual member states; (2) while a few central banks are making noises about a greater monetary role for gold in the future, there is as yet little real movement in this direction, either with respect to gold support for the euro or as regards the monetary use of gold by less developed countries; (3) the gold policy of Germany and the Bundesbank is a mystery with potentially explosive ramifications; (4) no one wants to talk publicly about the recent increases in the notional amounts of gold derivatives on the books of the bullion banks, but at least some bullion bankers evince concern that these numbers, despite acknowledged difficulties of interpretation, may indicate rising systemic risk; (5) some large gold mining companies are beginning to show more sensitivity to investors' concerns, including the dangers of hedging, the often misleading use of "cash cost" figures, and the importance of the "option value" of their shares on rising gold prices, thereby creating a widening chasm between companies that do not hedge (or hedge only minimally) and those that do; and (6) outside of investors, but especially among bullion bankers, there is great reluctance to credit or even to discuss seriously the mounting circumstantial evidence of manipulation or conspiracy to control gold prices."

Regarding (1) above, it should be noted that though the policy may have been fixed in stone some years ago, ECB officialdom is "still not sure of it" in public. They may just not have been told what their policy should be.


View Yesterday's Discussion.

Topaz
Lady Leigh.. re the "I" before "E" rule
http://www.caveofknowledge.com/sentences/sentence4b.htmAs discussed a while ago.

Enjoy ;>)

PS:- The rest of the site is good for a laugh too.
Tamzarian
New World Odor
A little Golden history.

Semitism or anti-Semitism and the Jews have almost nothing in common! How's that for a change?

As we all know by now, don't just swallow what the (mostly Jewish) mass-media is telling (dictating) you. Get yourself some history books and the "Encyclopaedia Judaica" (for instance) and get your knowledge yourself through your own research (as if you didn't already).
The following is a short outline. The rest is up to you, if you would like to take the effort.
Des Griffin has done tremendous research already for his book "Anti-Semitism and the Babylonian Connection".

As a result of an unrelenting avalanche of Zionist propaganda the vast majority of Germans as well as the rest of the world have been misled into believing that the word Semite refers almost
exclusively to the people who today are known as Jews. In fact, few things could be further from the truth. Interestingly, the words Semite, Semitism and anti-Semitism do not even appear in the 1828 edition of Noah Webster's American Dictionary of the English Language. They were coined only towards the end of the last century.

So, who are the Semites then?
The Semites are, according to the highly authoritative Oxford Universal Dictionary, 1944, the people belonging to the race of mankind which includes most of the peoples mentioned in Genesis 10 as descended from Shem, son of Noah, as the Arabs, the Hebrews, the Assyrians, and speaking a Semitic language as their native tongue. Most people in the world would answer the question whether the modern Jew is of Hebrew or Semitic origin with a clear "yes"! False!
This is simply not true. The Jews in modern society have nothing to do with the ancient Hebrews of biblical times. For decades we never thought of even questioning this basic assumption.
Actually, it is a historical FACT that some 95 percent of modern Jewry are not of Semitic stock. They are of Turkish stock - the so-called Khazars (Makes sense doesn't it. If you know your
history that is).

Arthur Koestler in "The Thirteenth Tribe" writes:
"The Khazars came not from Jordan, but from the Volga, not from Canaan, but from the Caucasus. Genetically they are more related to the Hun, Uigur and Magyar than to the seed of Abraham, Isaac and Jacob. The story of the Khazar empire, as it slowly emerges from the past, begins to look like the most cruel hoax history has ever perpetrated"........
"The Jews of our times fall into two main divisions: Sephardim and Ashkenazim. The Sephardim are the descendants of the Jews who since antiquity have lived in Spain(in Hebrew: Sepharad) until they were expelled at the end of the 15th century. In the 1960's, the number of Sephardim was estimated at 500.000.
The Ashkenazim or Khazar Jews at the same time numbered about 11 million".
(Ask any Rabbi. If he is honest with you he will confirm this)

The Jewish Encyclopaedia tells us about the Khazars:
Chazars: A people of TURKISH ORIGIN whose life and history are interwoven with the very beginning of the history of the Jews in Russia. ....driven on by the nomadic tribes of the steppes and by their own desire for plunder and revenge.(remember Turkish history) In the second half of the 6th century the Chzars moved westwards .... the kingdom of the Chazars was firmly established in most of southern Russia long before the foundation of the Russian monarchy by the Vangarians.(855 AD.)....At this time the kingdom of the Chazars stood at the height of its power and was constantly at war. At the end of the 8th century...the chagan (king)of the Chazars and his grandees, together with a large number of his heathen people, embraced the Jewish religion.(Having the Christians to their left and the Muslims to their right they were asked to join either one of those religions, but the chagan, out of protest, chose the Jewish religion.)

NOTE: remember there is no such thing as a Jewish race, just like there isn't a Christian or Muslim race. They are religions, or better said ideologies.

The Jewish population of the entire domain of the Chazars, in the period between the 7th and the 8th century, must have been substantial. About the 9th century it appears as if all the Chazars were Jews and that they had been converted to Judaism only a short time before.(Not so! Just like Americans today, who are of European stock) It was one of the successors of Bulan named Obadiah, who regenerated the kingdom and strengthened the Jewish religion. He invited Jewish scholars to settle in his domain and founded synagogues and schools. The people were instructed in the Bible, Mishnah and the Talmud and the divine service of the hazzanim.....
In their writings the Chazars used the Hebrew letters....the Chazar language predominated.....
The Russian Varangians established themselves at Kiev....until the final conquest of the Chazars by the Russians after a hard fight.
Four years later the Russians conquered all of the Chazarian territory east of the Azov river. Many members of the Chazarian royal family emigrated to Spain(remember the Sephardim who
already lived there)....Some went to Hungary, but the great mass of the people remained in their native country". *Jewish Encyclopaedia, Volume IV, article on the Chazars, pp 1-5*
After Obadiah came a long succession of chagans(kings), for according to a fundamental law of the state, only Jewish rulers were permitted to ascend the throne.

So, we glean from stricly Jewish sources that the vast majority of present day Jews cannot claim to be descendants of the original Hebrews, and possibly heirs to Palestine. Because of
that fact, the term "anti-Semitism" does not refer to the modern Jews. Benjamin Freedman, a Jew who was on a first name basis with most of the top Zionists in the 30's and 40's, puts his finger firmly on the true purpose behind the use of the term "anti-Semitism". He declares that "it should be eliminated from the English language". "Anti-Semitism" serves only one purpose today. It is
used as a smear word. When so-called Jews feel that anyone opposes any of their objectives, they discredit their victims by applying the word "anti-Semitic" or "anti-Semite" through all the
channels they have at their command and under their control"(and there you have it) "Facts are facts", Benjamin Freedman.

Also what happened in the Third Reich is not necessarily related to "anti-Semitism", it had to do with "anti-Khazarism" and "anti-Talmudism" (especially the "Mosaic Law").
NOTE: it was the innocent Jews that were slaughtered, not the 'important' ones.

The most important, widely known and powerful Khazar family is the Rothschild family, who are named after the red shield that is the symbol of the Khazars.(their real name is Bauer)
Does this all make sense?

Keep in mind that, because the modern day Jews are not of Hebrew origin, they never had and never will have a right for claiming the land of Palestine. The state of Israel is absolutely illegal,
even if the Jews would have some Hebrew origin.

To bring it down to the point: the Race with the most "anti-Semitic" attitude is probably the modern Jew himself. WHY? Because they hate and fight the Arabs, who really are of Semetic stock, whenever and wherever they can!!!
Therefore the "Arabs" are "anti-Khazar" or "anti-Jewish" and the Jews are the ones who are "anti-Semitic"!

Yes I know, the truth is very uncomfortable sometimes!

What's the point of all this?

Well, The Black Nobility of whom almost all of royal houses of Europe do descent, who are in turn infiltrated by the Khazar Jews, does make already a pretty good picture of what is really
going on in this world of ours, wouldn't you say?


Black Blade
Morning Wakeup Call! Quiet on all Fronts.
Sources: VariousTHE EASTERN FRONT:

Asia Precious Metals Review: Profit-taking caps platinum
By Hiroyuki Fujiwara, BridgeNews

Tokyo--July 11--Spot platinum was capped on Tuesday in Asia as massive profit-taking offset speculative buying interest, dealers said. Gold stayed in a narrow rangebound between U.S. $283 and $284 per ounce in the sluggish market during Asian trade ahead of the U.K. Treasury's auction scheduled on Wednesday, they said. Short-covering and some fresh buying supported Tokyo Commodity Exchange (TOCOM) platinum futures early in the morning following overnight strong NYMEX, this sustained spot platinum slightly, the dealers said. However, profit-taking capped TOCOM futures from further rallying due to fears of correction after straight price recovery in the past few days, they said. Fresh speculative buying eventually underpinned TOCOM platinum from sharp slips today, however, spot platinum prices failed to break over $550 after rebounding from about $530, the dealers said. Most players are still optimistic on platinum prices despite today's massive profit-taking, they said. Expectation of resumption of long-term exports from Russia to Japan depressed the platinum market last week, while unstable shipments from Russia could prevent world platinum prices from significant decline in the future, the dealers noted. Some said possible labor disputes at South African platinum group metals mines could support platinum prices in the near term, while others said miners could raise wages sufficiently following the higher metals prices. Palladium was steady amid firmer TOCOM futures, the dealers said. Players were hesitant to decide price directions in the gold market on a lack of fresh incentives, they said. Expectations of buying from physical dealers prevented players from selling gold below $283 today, while few are willing to buy before the U.K. auction, the dealers said.

Black Blade: Tomorrow is the Brit Gold-Give-Away! Amazingly some traders are still playing the TOCOM PGM market even though they know it is seriously rigged. PGMs should hold steady or more likely rise outside of TOCOM markets.

THE WESTERN FRONT:

Europe gold clings to range ahead of BoE auction

LONDON, July 11 (Reuters) - Gold was seen stuck in its recent range on Tuesday, with reasonable physical demand providing sufficient support ahead of the Bank of England 25-tonne auction tomorrow. ``The next 48 hours will be determining for the medium term price direction. The sentiment remains positive but we still have the Bank of England auction in the way,'' said one trader. While past auctions had triggered speculative interest and position-taking before the event, now the sale seemed to be viewed more as a hindrance to market performance. ``Instead of being a ``trading target,'' the auction now seems to be a hurdle to jump over to continue higher rather than a ``final speculative target'' as experienced in the past few auctions,'' said Frederic Panizzutti at MKS Finance in Geneva. Dealers said if the market remained over $278 until after the auction, the potential for a bull run would increase. At 0940 GMT spot bullion was trading at $283.50/$284.00, little changed from Monday's New York close at $283.60/$284.20. The price was seen stuck in the $282-$290 range for the coming sessions. A mid-year Reuters poll released earlier on Tuesday showed an average price forecast for 2000 of $288.72 an ounce for gold, rising to $303.02 in 2001. Gold's price was also unaffected by latest Swiss National Bank (SNB) data showing its gold and gold lending operations had slipped by 105.1 million Swiss francs to 38,291.5 million francs over the first 10 days of July. The SNB timetable calls for selling 120 tonnes by the end of September via the Bank for International Settlements. ``The Swiss sales are not having any impact on the market because they are selling on average the amount everyone expects -- around 1.2 tonnes of bullion a day,'' said one analyst.
Silver was also quiet, at $4.97/$4.99 from Monday's $4.98/$5.00 close. In PGMs, strong industrial demand continued to support prices with platinum last at $546.00/$554.00, virtually unchanged from $554.00/$556.00. Palladium was stable at $662.00/$677.00 from $663.00/$673.00. ((Sara Marani, London Newsroom, +44 20 7542 8058, fax +44 20 7542 8077, london.commodities.desk+reuters.com))

Black Blade: BoE drops a few tonnes of gold at bargain-basement prices, "Deal of the Century". Ya gotta love it when the Brits sell, and the next day the POG jumps higher. Think I'll quietly continue to systematically accumulate.

OIL:

Oil price falls as support for higher output mounts - Tuesday, July 11, 2000

Crude oil fell, bringing its losses since the end of June close to 9 per cent, on mounting support within OPEC for Saudi Arabia's plan to raise output to trim prices and avoid hurting worldwide demand. Venezuela, OPEC's No. 3 producer, said yesterday that the group would raise output for a third time this year if prices stayed high. Saudi Arabia expressed concern about surging prices a week ago and said it would add 500,000 barrels to the daily supply to send prices down to levels last seen in early May. "Traders are getting more used to the idea that the oil is coming," said Tom Bentz, an analyst and broker at Paribas Futures Inc. in New York. "There is a lot of political pressure on the Saudis from consumers, from the U.S., to get the oil out there." Fellow OPEC members at first opposed Saudi Arabia's plan, especially as it came in just two weeks after the producer group agreed in Vienna to raise production quotas by 708,000 barrels a day. Prospects for a unilateral increase by Saudi Arabia have prompted some members to change their positions. OPEC president and Venezuelan Energy and Mines Minister Ali Rodriguez, speaking in Indonesia yesterday, said OPEC would raise output by 500,000 barrels a day if the OPEC benchmark stayed above $28 (U.S.) for 20 consecutive days. Friday was the index's 14th consecutive day over $28. In other markets, corn fell almost 2 per cent to its lowest price this year and soybeans declined, as U.S. Midwest rains extended weeks of wet weather and boosted prospects for one of the biggest crops ever this fall. Corn and soybean prices have fallen more than 20 per cent since early May as recurring storms recharged soil moisture lost during one of the driest winters on record. In just eight weeks, crop-growing conditions have improved as steady and often heavy rains reached some of the driest parts of the Midwest. Coffee jumped almost 4 per cent, rebounding from a nine-month low, as forecasts for a dip in temperatures in Brazil raised concern that frost could damage trees in the world's biggest grower. Temperatures could fall by Friday, with some frost possible in low-lying areas, meteorologists said. A more extensive frost could damage trees that will bear next year's coffee crop, although the current harvest would be unaffected.

Black Blade: Someone got to Iran and Venezuela in the last 24 hours. Question is whether it was because of threats or political pressure. Either way, it looks as though they caved in. BTW, the prez sez: Lets make a heating oil reserve for the northeastern states. So far it passed in the house, but may face opposition in the senate. Other than that, refining capacity is limited. Refiners are not going to load up tank farms at $30/bbl oil and risk oil going to $28/bbl, or whatever. The margins for refiners are razor thin. So how much oil can OPEC afford to hold with increased production? With Asia coming on strong over the last year, oil demand has come back as much as before the "Asian Contagion", and without new refining capacity it could get even worse over time. In the US, refiners are reluctant to take on the liability of building new refineries as the cost vary widely and the enviro-crowd with the EPA makes the risks unbearable.

Meanwhile, S&P Futures down -3.00, fair value -0.47 indicating a mostly neutral open on Wall Street at these levels (NOTE: could always change dramatically before the open). Au is unchanged at $283.80, ditto Ag at $4.96, Pt down -$2.00 at $542.00, and Pd unchanged at $660.00. Of interest should be the PPI this Friday! Will the Petroleum prices be reflected in the manipulated PPI? We shall see, as last month the BLS even stated that gas prices fell 3.5%, Hmmmmmm���.
Parsifal
Fresh Reading at the Golden Sextant
http://www.goldensextant.com/commentary13.html#anchor3944Excerpt:

Summed up briefly, my principal impressions from the conference were: (1) the ECB and its 11 member central banks do not have a common policy on gold, which remains almost entirely subject to national control by the individual member states; (2) while a few central banks are making noises about a greater monetary role for gold in the future, there is as yet little real movement in this direction, either with respect to gold support for the euro or as regards the monetary use of gold by less developed countries; (3) the gold policy of Germany and the Bundesbank is a mystery with potentially explosive ramifications; (4) no one wants to talk publicly about the recent increases in the notional amounts of gold derivatives on the books of the bullion banks, but at least some bullion bankers evince concern that these numbers, despite acknowledged difficulties of interpretation, may indicate rising systemic risk; (5) some large gold mining companies are beginning to show more sensitivity to investors' concerns, including the dangers of hedging, the often misleading use of "cash cost" figures, and the importance of the "option value" of their shares on rising gold prices, thereby creating a widening chasm between companies that do not hedge (or hedge only minimally) and those that do; and (6) outside of investors, but especially among bullion bankers, there is great reluctance to credit or even to discuss seriously the mounting circumstantial evidence of an international conspiracy to control gold prices.
TheStranger
One Great Way To Reduce The Number Of Quality Contributors...
to this usually excellent forum is to allow posts like #33356 to stand without objection. Tamzarian (or Adolph or whatever your real name is), perhaps you would like to read the rules of the room before posting again.
TownCrier
The Week in Gold...updated!
http://www.usagold.com/wgc.htmlOf note from this week's commentary by the WGC...a tale of two countries:

"The Canadian finance ministry announced that it sold 94,000 ounces of gold during June as part of its long-standing sales programme. Canada's official gold reserves now stand at only 1.2 million ounces (37.3 tonnes)."

Sigh. Meanwhile...

"Imports of gold into Turkey totalled more than 101 tonnes during the first half of the year, more than double the 47 tonnes reported for the same period of 1999."

Now THAT'S impressive.
USAGOLD
Tuesday with the Gold Broker
http://www.usagold.com/Order_Form.html7/11/00 Indications
�Current
�Change
Gold August Comex
283.50
-1.40
Silver July Comex
5.01
-0.04
30 Yr TBond Sept CBOT
97~21
+0~03
Dollar Index June NYBOT
106.90
+0.25


Tuesday with the Gold Broker (7/11/00): This is the time of
year when every analyst and his or her "analyst" has an opinion
about where the economy will be going for the rest of the year.
Many of these actually get published and are treated with the same
awe usually reserved for an ancient document find in the Sinai
desert. While some are predicting a slowdown, I have yet to see
any evidence. In Colorado, the headlines this morning shout of a
record low unemployment rate-- 2.2%. That adds up to virtually
full employment. . . . . . . . . . . . But says an economist for
Vectra Bank this golden cloud has a silver lining (nothing goes
bad in America anymore): "The worker shortage is already forcing
the fast food, technology; and construction industries to pay
higher wages.". . . . . . So inflation lurks. . . . . .(Check
before eating that lunch time fast food treat: Even flipping
burgers has a learning curve.) . . . . . . . . . . The Gold
Broker's View: A slowdown in this election year? I don't think so,
fellow goldmeisters. If Clinton learned anything from his
predecessor, it has been to keep a wary eye on the Fed Chairman in
and around election time. George Bush has claimed that Fed policy
in the early 1990s played a significant role in his loss in 1992..
. . . . If Al Gore wins (despite his mumbling and bungling), he
can thank Bill Clinton and Alan Greenspan for it . . . .A
Temperate Caution: Though the year could come to a happy
conclusion, one is forced to wonder about the election hereafter.
The gathering inflation thunderstorm will continue to rumble
through the remainder of the year . . . . . . . . . .Speaking of
Alan Greenspan he will be speaking at the National Governors
Association today. The subject: Structural Change in the New
Economy . . . . . . . . . . . Gold today was subdued in advance of
the Bank of England auction. . . . .From Dow Jones: "'After the
unpredictability of prices fetched at previous BoE auctions,
traders are unwilling to take positions and will instead play the
volatility post auction,' said Kamal Naqvi, London-based gold
analyst with Australian-owned MacQuaire Bank. This sentiment was
echoed by MKS Finance in its daily report. Instead of being a
'final speculative target,' the auction now seems to be a hurdle
to jump over, it said. Traders are hoping the auction will lift
the market out of the recent period of consolidation,and give the
market fresh direction." . . . . . . . . . . .A Peek at Friday's
PPI numbers courtesy of Reuters: "Key monthly reports on U.S.
producer prices and retail sales due on Friday are also
responsible for an element of caution in the market, traders said.
Economists polled by Reuters estimated, on average, that the PPI
rose 0.5 percent in June, but only 0.1 percent excluding volatile
food and energy prices. Market participants were wary of recent
high oil prices seeping through the economy, boosting prices of
other items.". . . . . . . .Under normal circumstances such heat
would be expected to engender a little fire, but in the New
Economy we find New Truth in a New Package with New Rules and all
the old rules are out the window. . . . .My guess is that the
pundits will say something like this in true Jerry Seinfeld
fashion: "Sure it's inflation, but its not really INFLATION. If
it were INFLATION, we would know it. Somebody from the government
would tell us it's INFLATION and then we would know. But they're
not. The cost of living is going up but its not INFLATION . It's
inflation with a small 'i -- that's different and you ought to
know it. YOU OUGHT TO KNOW IT!!". . . .This is interesting in
today's Bridge News report: "South African gold producer Gold
Fields Ltd. is rumored to be in talks with Ghanaian government
officials that could see it take control of Ashanti Goldfields'
non-Ghanaian assets and its hedge and debt position. Although Gold
Fields officials would not comment on the speculation, a source
close to the deal told I-Net Bridge that Gold Fields had made
proposals to the Ghana government recently and were "very
favorably received." . . . . . . .Question from the Gold Broker: I
had no problem with that until the subject of gold loans and the
hedge book came up. Goldfields has enjoyed special status among
gold investors in recent months because of its clean (virtually
non-existent) hedge book. In fact, one might say that Goldfields
has become the belle of the ball as far as true gold advocates are
concerned. What happens to that special status when Gold Fields
assumes the disastrous hedge book of a company (not to speak of a
pile of lawsuits) which almost went under several months ago
because the price gold had the audacity to rise? Will the sins of
the Ashanti father be visited upon the Gold Fields son? Taking a
cue from CEO Chris Thompson's anti-hedging public positions, one
would have to assume that the hedge book will be judiciously
retired as quickly as possible, but it would be a mistake not to
publicly address these legitimate questions without delay once the
acquisition is complete. That having been said, Goldfields is just
the latest of a long line of suitors since Ashanti's troubles
began last Fall. Somehow the Ashanti deal never gets done. . . . .
.With that, my friends, we'll bring this Tuesday with the Gold
Broker in for a landing. . . . . . . Have a good day, my friends.
See you back here tomorrow.

An Invitation:

I would like to invite those who take an interest in the type of
analysis read here to give our newsletter a try -- News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals. This month we focus on oil and inflation. Many
analysts and investors think there very well may have been a
fundamental shift in economy that could favor the gold market and
hammer the equities and dollar market. These opinions from various
sources are covered in some detail in the upcoming July issue.
Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The package is
offered at no cost or obligation. You can call Marie at
1-800-869-5115 to request the newsletter and Almanac or
click on link above.

TownCrier
Mr. Tamzarian, if you please...
http://www.usagold.com/cpmforum/tools/guideandsignup.htmlSome say "Tuh-MAY-toe"
Some say "Tuh-MAH-toe"
Some say "ANTI-tomato"

I don't care what you say when you're in the comfort of your own home or talking among your friends, but THIS happens to be a GOLD discussion forum. Your first post here bodes ill. Please be advised that if you can't make a responsible gold-related point, you must make no point at all. Those are the rules of the room.
SHIFTY
USAGOLD
Is there a link to I-NET BRIDGE story on Gold Fields Ltd.?

:(
$hifty
fastinfo
Lawsuit against Nesbitt Burns Canadian Brooker

Recours en justice contre Nesbitt Burns � Legal Action against Nesbitt Burns

Si vous croyez avoir �t� mal inform� (mauvaise gestion de votre portefeuille et/ou fausse information) concernant vos placements chez Nesbitt Burns, courtier en valeurs mobili�res au Canada, nous vous conseillons d�agir le plus rapidement possible afin d��viter les d�lais de prescription.

Les plaintes concernent en particulier les placements suivants: SEMAFO (SMF), SUNDUST (SUN), MERCANTILE (MPT.U), CANUC RESOURCES (CANC), TIOMIN (TIO), PENGIA (PGD) ou tout autre entreprise d�explorations mini�res et p�troli�res.

Le bureau concern� est : Nesbitt Burns Laval

Plusieurs investisseurs ont d�j� port� plainte � la bourse de Montr�al et � la commission des valeurs mobili�res.

Plusieurs investisseurs ont d�j� obtenu un r�glement avec Nesbitt Burns, d�autres sont sur le point d��tre r�gl�s ou iront en justice pour obtenir satisfaction.

Si vous croyez avoir �t� mal inform� par votre courtier nous vous sugg�rons de contacter le plus rapidement possible votre avocat ou de faire appel � cet avocat ( Ma"tre Hugo R. Martin,
Tel : 514 878 1900, E-Mail : martin@megalegal.com) pour un recours en justice avec un groupe de personnes.

Information :

Jugement rendu en cours supr�me pour une affaire similaire (fran�ais)

http://www.lexum.umontreal.ca/csc-scc/cgi-bin/repere.cgi?corpus=pub_fr&tout=Placements+Armand+Laflame⟨uage=fr&form=csc-scc%2Ffr%2Findex.html⦥=1#doc=190


If you think you have been misinform by Nesbitt Burns � Canada, wrong information concerning your portfolio or the companies you did invest, we highly suggest you to put legal action against Nesbitt Burns before court deadline.

Complains concern mainly investment with these companies: SEMAFO (SMF), SUNDUST (SUN), MERCANTILE (MPT.U), CANUC RESOURCES (CANC), TIOMIN (TIO), PENGIA (PGD) or any other company involve in gold mine or oil.

Concern this office: Nesbitt Burns Laval

A few investors already had a settlement with Nesbitt Burns, other are still waiting for a settlement or will put legal action.
If you think you have been misinform by Nesbitt Burns you should call your lawyer ASAP or this lawyer and join others plaintiffs: ( Ma"tre Hugo R. Martin, Tel : 514 878 1900, E-Mail : martin@megalegal.com)

Judgement that was made on high court for a similar case

http://www.lexum.umontreal.ca/csc-scc/en/rec/html/laflamme.en.html


ax
AUSTRIA SELLS 30 TONS
Austria sold 30 tons of gold according to reports last week.
SHIFTY
(No Subject)
Was just visiting over at Kitco forum. I had hoped to find out more about what is going on with Gold Fields Ltd.
I don't know about some of them.
Do you think we should tell them not to eat the paint chips?

$hifty
CoBra(too)
@ax - Well, Austria sells 90 tons ...
... Which is a shame and doesn't fit into the WA - hope some official from the Austrian National Bank - is it Klaus Liebscher (Govenor) or Peter Zoellner, who recently described gold as "no-ones obligation asset - will comment on this inconsistency.

Otherwise, no new news .... except th BOE, again will
dump their gold at premiums ... ever heard about negative premiums? No, ask the Brits, they've done it before ...

Best CB2

PS: @ Stranger - Hello - I somtimes can't help to make an a.. of myself - I enjoy your tenacity and feel you'r right!

ORO
Mckay Online
http://www.econlib.org/library/Mackay/macEx.htmlMemoirs of Extraordinary Popular Delusions and the Madness of Crowds

A timeless classic of the markets. And it is free.


A few other books of interest appear at the site, including Bastiat and Adam Smith.
CoinGuy
What? #33356
ALL:

I'll tell ya, I've read some strange posts in this forum. Some I found quite amusing, but this one I do not. I'd like to have this rant(#33356) erased from this forum, and let this guy go back to the Nazi board he crawled out from...

A JEW(Coinguy)

Oh yeah, GO GOLD
ORO
Why here?
Why is it that 33356'ers come here to post?

Is being anti-Chazar or anti-Turk, any better than being an anti-semite?

I am sure many Sephardic Jews agree with the message but would keep this view quiet.

Golden Truth
Tamzarian
Hello Tamzarian i liked your post very educational. I don't care what others think or say, your post was not "Anti-Semetic" it was only to enlighten ignorant people of the difference. This forum should be able to grasp that no??

We all seem to now know the difference between "Paper Gold" and real Gold, but only after it was pounded into our heads over and over by F.O.A. What makes Tamzarian's
post explaining the difference between a "anti-semetic" and "anti-jewish" so hard to understand. The guy did his homework and until i see a better explanation i,am going to run with his! End of story.

Now what the H#ll is wrong with GOLD it can't even hold onto a $5-$10 gain. What ever happened to $30,000 GOLD many here believed that LIE didn't we? Because it appealed to our sense of GREED,but now we are all of a sudden pious over one post that does show us the correct history of things? How sad,because Gold doesn't go up in price, the forum turns into a bunch of censors? I guess it doesn't say much for GOLD ownership either.

Just another Commodity with an ugly historic past and by the looks of things an even uglier and poorer future.

Gold The Joke of the last Century and the Next!
Good luck to all and may God have mercy on all your Souls.
"For The Love Of Money Is The ROOT of all Evil"
G.T
Beowulf
BOE auction
Well, it looks like the traders are going to let the BOE get the lowest possible price for this auction tomorrow. By the way, aren't the Swiss selling one ton of gold every day? Oops, I shouldn't have said that, that news might get out and send the price plummeting tomorrow.

Prediction for tomorrow:
Same as last time - 3 times over subscribed - spot price will ramp up 3 minutes before BOE gives the sale price - the sale price will then be under the current spot price and a whole bunch of negative news will come out stating how they couldn't even sell it at the going spot price - Price prediction of $283.10, give or take $0.25, by NY market close tomorrow.

I hope I'm wrong.

Gold..Got some, gettin more.
-Beowulf
Hudson
What if?
When countries sell gold like Canada did recently, do they actually move the gold to the country they sold it to, or is it all just sold on paper, and not possession?
To me it wouldn't make sense for the gold to be physically moved all the time because: Planes crash, boats sink, trucks are robbed, etc....
I was just curious.
Theoretically, If a plane was transporting a significant amount of gold from Canada to Austailia or wherever , and it crashed into the ocean, and the cost of recovery was too great, would that news probably drive the price up?
Probably, becuz there would be less around.
So anyway, when a sale is made, does the gold actually move anywhere?

Hudson
beesting
SHIFTY #33363&33366...Info on Gold Fields Ltd.
Received by way of regular mail yesterday a 2 page "Shareholders Fact Sheet" concerning the proposed merger between Gold Feilds Ltd. (South Africa) and Franco-Nevada(Canadian)mailed from Colorado USA. I live in the U.S. and hold my shares in certificate form(Not at the Brokerage house). If you hold your shares this way you should get some info soon, especially if you're in the U.S.
Canada, and off the beaten path, it depends on your local mail service. If your shares are in an account at a Brokerage house, be patient it could take a while to get your letter.

Most of the stuff covered in the letter has already been discussed here at USAGOLD.The letter does go into more detail on the "PROPOSED" merger.
It also includes 8 graphs comparing how the proposed merger will campare with the other 6 top Gold companies of the world. Here are a few of the positive things listed:

Gold Fields International will have, Minimal debt, over US $700 in cash or near cash(Gold?).
NO HEDGING!! Which translates into when the price of Gold goes up, every ounce of unmined Gold will gain value in relation to the price of Gold. Production costs average $232 per ounce. Break even cost $242 per ounce.(The lowest in the industry, AngloGold 2nd)
Over 25% increase in cash flow from each $25 rise in Gold price.(Barrick, about 2% increase in cash flow, lowest on the list of 7 companies.
Proven and probable reserves 80 million ounces 2nd in the world. E-mail address listed:
South African & European Investor Relations:

williej@goldfields.co.za

North American Investor Relations:

camartin@gfexpl.com

Hope this helps......beesting.
beesting
Correction on last post.
Gold Fields International should have over$700 in cash.
SHOULD READ!!
Gold Fields International should have over$700 MILLION in cash.....beesting.
Leigh
You Know, Aristotle...
It sure would brighten up everyone's day if you would tell us why you think gold might go up in July or August!

CoBra(too) and Golden Truth, it is so nice to have you both posting!
CoBra(too)
TC -Tuh Ma Toe... Juice - or virgin Mary ...
... and some say Paradeis - the apple of paradise - not juice - though SAFT - ask anybody north of the "Weisswurst-Border" to go into Saft (or juice)- go figure!

It is a gold forum and I feel there are many topics going unchallenged. So how about the Gold/Dow Ratio, which must have disappeared with the 'advent' of new economy stocks to the (former) old fashioned index. Lies, more lies seems as inadequate, as credit upon more credit to a bubble credibly bursting.
Hist(e)orically a 1:1 gold/Dow ratio occurred in the aftermath of excessive monetary expansion. Can't happen today, since AG is stepping on the brakes - and as every driver knows intermittent appliance of pressure - gets you to a FULL STOP! - which some may call a soft landing - against the wall!

So a 1:1 Dow/Au ratio may mean 5000 Au vs 5000 Dow -
pick your preference - regards CB2


@ Leigh - will not forget your * will have Sacher send you the real treat - if you'd be kind enough to answer frram@netway.at. - cheers
SHIFTY
Beesting
Beesting I thank you . I also received the Letter from Gold Fields. The one dated June 13, 2000 has been on there web site since June , but the thing that made me crazy today was :( From USAGOLD # 33361). ".This is interesting in
today's Bridge News report:" "South African gold producer Gold
Fields Ltd. is rumored to be in talks with Ghanaian government
officials that could see it take control of Ashanti Goldfields'
non-Ghanaian assets and its hedge and debt position.

$hifty
Boxman
CoBra(too) This may tie into your Dow/Au statement - From Gold Eagle
JavaMan
All
First, the truth...

The term Jew is first found in the Old Testament in the book of Esther written during the captivity about events that had taken place earlier. In chapter 2 v5 it says: "Now in Shushan the palace there was a certain Jew, whose name was Mordecai, the son of Jair, the son of Shimei, the son of Kish, a Benjamite."

So the contrast between Judah and the rest of the twelve tribes of Israel was lost in a strange land and, as Nebuchadnessar's campaign was against Judah, so "Jew" became the name used by the Gentiles.

The tribe of Benjamin was one of the twelve tribes of Israel. It was named after Benjamin, one of the twelve sons of Jacob (later given the name Israel).

Webster's defines race as: a family, tribe, people or nation belonging to the same stock. Also, A class or kind of people unified by a community of interests, habits or characteristics.

Now the lie...

Msg#: 33356 states: "NOTE: remember there is no such thing as a Jewish race, just like there isn't a Christian or Muslim race. They are religions, or better said ideologies."

No. This is statement is wrong and it needs to be exposed for the tripe that it is. There is, in fact, a Jewish race. So what is the underlying motive of such a post that twists the truth? Off topic or not, it is obvious this post offers nothing of edification to anyone. Rather the sole purpose is to sow the seeds of hate through disinformation and that can not be allowed to stand.
Boxman
Sorry about that last link/That;s one reason I lurk
http://www.gold-eagle.com/editorials_00/klombies071000.htmlThis should work just a tad bit better.
wolavka
tonite trading range for gold dec comex contract
288 low

291. 40 high

290 globex settlement prior to auction

auction should be positive for gold and we may see a nice gap jump at comex.

resistance points still same.

280 is oversold and will generate massive buying.
Canuck
Howe in Paris
Thinking out loud without any point in particular I am finding:

a)Everything is quiet, on hold. The markets have been very sideways lately, Nasdaq dare not break 4,000 to the upside.

b) Gold in a very tight range for a long time. (270/290)

I find Howe's article disturbing, unsettling. The 5,000 tonnes short position I find odd. I thought the 10,000-14,000 tonne figure was 'accepted'. The recent raid on GFMS regarding their estimation of short figures have fizzled out. Attacks on ESF have fizzled out. GATA seems less vocal of late. What's happening?

Howe's mention of a non-concerted EU (a la Washington Agreement) bother me.

And when the hell do we get a audit of the gold in Fort Knox? Why is this law ignored?
Canuck
@ ARI @FOA
Where are you guys?

I paid my 2 bits to see a high diving act and I ain't leaving 'til I see the high diving act!!
Canuck
Trade deficit
http://www.freetrade.org/pubs/speeches/ct-dg081999.htmlAn increasing trade deficit is a symptom of a booming economy and is not a bad thing, so the author alludes to.
---------------------------------------------------------

"Of course, none of this evidence argues that the trade deficit is the cause of economic blessings. What it does indicate is that rising trade deficits are often caused by the same underlying factor, namely rising domestic investment, that drives a number of other economic indicators--employment, production, poverty rates--in a positive direction.

Without a trade deficit, Americans could not import the capital we need to finance our rising level of investment in plants and new equipment, including the latest computer technology. The same appreciating dollar that expands the trade deficit helps keep a lid on inflation while lower import prices raise the real wages of the vast majority of American workers.

When the underlying causes of the trade deficit are understood, it should become clear that the biggest threat to our economy is not the deficit itself, but what politicians might do in a misguided mission to shrink it."


elevator guy
Khazria, so what?
Throughout the diaspora, there were intermarriages with the locals, so whats new? Does that change the fact that all the corners of the earth, that flock back to the homeland purchased from the locals by Abraham, have a right to what was not only given to them by God, but paid for at market price? Of course not. The tie that binds the Zionists together is the fact that no matter how mixed, their genes still have one thing in common, that being their heritage as decendants of Abraham. And if not for Abraham, what would they have in common? Their faith in the Living God, who revealed Himself through Israel, and has said that He would gather them together after so many years, and across so many miles. Its a beautiful thing, and no other ancient culture has such a parallel re-birth. Just the chosen race.

An interesting point about Abraham is: That after God told him to go to the strange place, to a land that would be given to him, Abraham still had to buy it from the locals.
The local guy said that Abraham could stay for free, (but that was a gift that would eventually be shown to have a string attached, and in the eyes of man, it would never actually be considered to really be Abrahams' land). So Abraham said he would buy it from the local. The local said it is worth at least (an artificially high number was mentioned as the going market price) The local was following a popular custom of negotiation, where you start the bidding high, and work down from there. Now if Abraham was to negotiate, regardless of what price he attained, it could always be said that Abraham "stole" the property, or at least obtained it by co-ersive methodology. This could not be, as it was to be the land that was not only given to Abraham by God, but also bought with a price. There had to be no question as to the validity and legality of this being Abraham's land. So Abraham did not make a counter-offer, but immediately accepted the first price, that was actually much, much, too high. He did this on purpose, so that no one could ever say that the land was anything but Abrahams. And the land belongs to his decendants, regardless of percentage of true Abrahamic genes in their bodies. No other people have a right to what was given by God, and bought by Abraham, and at a high price at that.

The caves on the property are known as "Mach-pala" (sp?) Which means "double cave".

Abraham and Sarah, as well as Lot, were buried here.

Mach-pala was lost for centuries, and covered up by Muslims who white-washed the area of any vestiges of the Israelites. They used a black plaster to cover walls, buildings, and any art and writting, and this was typical of them. They plastered over many shrines, and landmarks of the Israelites.

Only a few years ago, Mach-pala was found, and entered by a secret passage, and Hebrew writting was observed indicating that this indeed was the tomb of Abraham, with its passage way to the cave chamber below. But because of political wranglings over the Muslim controlled land above the caves, it could not be published, not investigated, for fear of revealing the entry, beneath property controlled by the Muslims.

And this secret remains today, just below the surface, in Mach-pala.

Just below the land that was given to Abraham by God, and bought at a very high price.

How is this all gold related? Well, maybe not directly, but those who love gold love the truth, and I hope you will allow me to present my feeble knowledge and opinions in the name of standing against hatred, and promoting peace. If un-truth and hatred shows its face in this Forum, the best we can do is to fight back with honesty, and conviction, in the hopes that those lost ones will be ashamed of their cheap, stolen, "kharma" of racial pride, and be drawn in awe and wonder at the golden truth and knowledge of God.
Leigh
elevator guy
No, elevator guy, it's silver related! Abraham paid four hundred shekels of silver for his land!
TheStranger
Canuck
Thanks for your post #33385 and the associated link which I followed carefully.

Obviously, trade deficits are also caused by numerous other factors which are far less salutary than the one described. Restrictive energy extraction policies and a pandemic appetite for sport utility vehicles come immediately to mind. But so does an expansive monetary policy. Certainly, each of these have contributed mightily to the recent U.S. experience. But, in any case, even if the source of such an enormous trade imbalance could be deemed entirely beneficial, which is illogical in my view, it wouldn't matter. You see, the relevant question is not the cause of the phenomenon but rather its effects.

No civilization (or single person, for that matter) can indefinitely consume more than it produces without something having to give. For an individual, the consequences are retrenchment or bankruptcy. But, for a nation, the end result will either be recession (brought on by credit exhaustion) or still more rapid inflation of the money supply. And, of course, while we are waiting, we just might witness the wholesale transfer of the nation's assets to foreign investors.

As to your source's concern that politicians might attempt "a misguided mission to shrink" the deficit, I am not sure what is meant. If the reference is to possible protectionist legislation, then I quite agree. But, that notwithstanding, the Fed, at least, darn well better be concerned about the problem, and I think recent statements indicate, however belatedly, that they are.

*****

Thanks to CoBra, Gandalf and Cavan Man for recent salutations! Right back at you, boys!
Chris Powell
More on FT conference, and more ESF disclosures
http://www.egroups.com/message/gata/504?Latest from Reg Howe.


To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@eGroups.com
THX-1138
RE: Shifty - on Idaho
You said if I knew the county in Idaho you could tell me a location for gold panning. Well I don't know the county but I will be at Lake Coeur D'Alene Idaho, at a KOA campgrounds there. It is near the town of Coeur D'Alene and also near silverwood idaho. At least that is what my parent say anyway. Only thing is I can't find the lake or the town of silverwood in my Rand McNally Road Atlas. Can you help?
L.Harrison
Chris Powell
That's a Howe+++WOW+++.
Thank you GATA.
SHIFTY
Buy/Sell
We always hear about all the gold that is being sold into the market. You never hear about all the gold being bought. You can't sell if nobody is buying. Just as you cant buy if nobody is selling! Instead of hearing that "Austria sells 30 tons of gold !"
It Should be " Someone Bought 30 tons of gold from Austria!
It sounds a lot more bullish for gold ! When you hear that some person or persons bought 30 tons of GOLD, it makes you think : Why are they loading up? I wonder what they know that I don't? Could start a gold rush if it were reported that way on CNBC .
I'm not holding my breath !
I do think the day is coming that CNBC will get a lesson in " You can't sell if nobody is buying"
Then when they try to run to gold they will get a lesson in " You can't buy if nobody is selling!"

Gold get it while you can!

$hifty
:)
SHIFTY
THX1138
Give me a few min.
TEX
T.C. and tamzarian
Well said Town Crier. You know,I lurk here 99% of the time and really enjoy a lot of the dialogue and intelligent insight. What I don't have is a lot of time to waste......even the time spent scrolling through whatever tamzarian (lower case "t" intentional)was trying to promote. Jeez......if if want to get into some of that stuff I'd just log onto nazi.com or something. Nite all...........
SHIFTY
THX1138
All I can find is : Kootenai County: many regional streams and creeks yielding pannable gold near Coeur d' Alene.

If you take a ride over to the next county to the east : Shoshone County: along the St.Joe and Upper St.Joe Rivers; stream and bench gravels in the Pinehurst, Wallace and Kellog areas; regional streams and benches, and near Prichard, especially Prichard and Eagle Creeks!

Take a wisk broom with you to clean bed rock , and a pry bar for the cracks! Wish I was going.
Have fun.
$hifty
View Yesterday's Discussion.

SHIFTY
THX1138
Found a bit more!Idaho Gold was first discovered along the Pend Oreille River in 1852. In 1862, rich placers were found in Clearwater County near the present-day town of Pierce. Placer deposits account for a significant portion of Idaho's nearly 10,000,000 troyounces of gold.
Idaho remains a popular destination for scores of modern-day prospectors. Significant amounts of gold still are being found in many of the northern and central of this sparcely -populated state. Some of Idaho's more remote areas offer a unique combination of rugged'scenic grandeur and the potential for rich, golden "pockets"

$hifty
:)
Goldsun
Encouraging New Posters
used to be a central tenet of this forum. As I recall, our host has gone to some lengths to advance this cause. Perhaps I missed a message from him rescinding this policy.
Those who demand the electronic equivalent of bookburning might do well to recall which government was most notorious for this act.
Goldsun
HI - HAT
Turning Point
Looks like an important turning point for gold shares. This has been a long time base building (put-call manipulation?).I see this leg up carrying to XAU 65 to 70, with 61 holding in any corrections.

Gold itself may have slight downturn but I'm thinking when strenghth comes in, then the 290-310 area will become the new trading range, for move up to 360 that will confirm that gold is in a bull move.

It is simply a case of TIME has come.

Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 11, 2000

Rates for Monday, July 10, 2000

Federal funds 6.51

Treasury constant maturities:
3-month 6.10
10-year 6.04
20-year 6.23
30-year 5.88

upside-down spread FF vs long bond = (0.63%)
wolavka
(No Subject)
295 298
Canuck
BOE Auction
POG sold @279.75; 1.3 times bid.

This may be a bizarre day.
wolavka
you believe it
dec support at 282, this is nothing , end of day will close higher.
wolavka
HOLD THE CHEESE
It's yellow and it sometimes stinks, but is does stand alone.

hang on.
JavaMan
What it is not and what it is...

It continues to amaze me that people are so easily confused about such a simple issue. Indeed, one wonders how they survive the weightier challenges of life.

USAGold is not a government, nor is it a political group, nor, now read this carefully, does it guarantee the freedom to say what anyone feels like saying.

USAGold is a website sponsored by a private businessman. At the top of the forum webpage it says "This forum is offered to USAGOLD / Centennial Precious Metals' current and prospective clientele as a means to enhance your understanding about the ownership of gold and gold bullion coins through the free exchange of ideas, opinions and information by like-minded individuals. We welcome your participation either as an observer or poster.

[Now pay extra close attention to this part...]

If you wish to post at the USAGOLD Forum, please go to our Guidelines and Prohibitions page (there are certain rules of which you need to be aware) and then register for your password. Thank you for participating in our forum! We look forward to a long, cordial, and mutually enlightening relationship."

Now, boys and girls, lets click on the Guidelines and Prohibitions link. What have we here? They look like Guidelines and Prohibitions to me. Can you say "Guidelines and Prohibitions".

"1. Personal attacks; slanderous or derogatory remarks; off-color jokes; lewd and/or lascivious comments; ethnic, religious and racial slurs
2. Foul language and profanity
3. Any slander or derogation of USAGOLD / Centennial Precious Metals or any of its competitors
4. Self-promotion; promotion of the company you work for; promotion of internet sites that compete directly with USAGOLD / Centennial Precious Metals.

In general, the same rules that apply to ordinary civil discourse shall apply here as well. Treat others with respect. Remember that this is a public forum being read by many people spanning all walks of life. We take this seriously and request that posters do also. Assuming you are in agreement with the above and feel you can post according to these guidelines, we very much welcome you to the USAGOLD Forum."

In other words, these are the rules by which we are to conduct ourselves. We are guests while we are here and, as such, we have an obligation to respect the wishes of our gracious host. At least that's how I was raised.
USAGOLD
Gold Market Report: BOE Auction Reflects Seasonal Gold Doldrums
http://www.usagold.com/Order_Form.html7/12/00 Indications
�Current
�Change
Gold August Comex
281.00
-2.30
Silver July Comex
5.02
+0.02
30 Yr TBond Sept CBOT
97~09
-0~09
Dollar Index June NYBOT
107.32
+0.52


USAGOLD MARKET REPORT (7/12/00): Gold was down about $2 this
morning after a lightly bid Bank of England auction. The gold
market is generally quiet this time of year -- a seasonal thing --
and one should not read too much into this morning's results. At
the same time I wouldn't be surprised to see New York traders take
advantage of the slow season as well as the BOE results to drive
the futures' prices lower. In a discussion with James Turk
yesterday he pointed to $278 spot as a crucial support number on
the charts. Beyond the hazy short term prospects, in a Reuters
report titled "Gold, PGMs seen higher in 2000," 22 analysts had a
generally favorable view for the yellow metals expecting an
average price of $303.02 for the year. MKS Finance's Frederic
Panizzutti expressed a view close to our own: "We expect the U.S.
dollar to weaken against all major currencies, making gold less
expensive in terms of currency conversion. Any sharp decline in
the dollar would result in a wide process of portfolio
reallocation. Gold would be a perfect diversification asset
against European and Asian currencies as it generates U.S.
dollars." 2001 price estimates ranged from $270 to $350, according
to the article.

Those of you who discounted my observation yesterday -- that
nothing much is going to change this year with respect to Fed
policy due to the election year -- should take into account
yesterday's comments from Alan Greenspan that "job insecurity"
would act as a talisman to keep wages down. I wonder how many
business owners and corporate personnel managers could restrain a
chuckle upon hearing that one. Contrast Greenspan's remarks to the
reality of record levels of employment, consumer confidence, and a
borrowing binge that suggests that workers aren't worried about a
thing. The conclusion follows that these remarks were little more
than a justification for the Fed's lack of restraint in the face
of rapidly building price pressures just about everywhere and the
record employment rates. This is little more than electioneering
on Mr. Greenspan's part. One wonders if he still carries a
Republican Party card in his wallet.

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

An Invitation:

I would like to invite those who take an interest in the type of
analysis read here to give our newsletter a try -- News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals. This month we focus on oil and inflation. Many
analysts and investors think there very well may have been a
fundamental shift in economy that could favor the gold market and
hammer the equities and dollar market. These opinions from various
sources are covered in some detail in the upcoming July issue.
Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The package is
offered at no cost or obligation. You can call Marie at
1-800-869-5115 to request the newsletter and Almanac or
click link above.
Goldsun
Forum Forum
JavaMan
Thank you for pointing out that the personal attacks, derogatory remarks and ethnic slurs directed against the new poster by various members of the forum are clear violations of the Guidelines and Prohibitions. While your post 33404 was no doubt well intended, it appears to contain derogatory remarks about those members, thereby placing it in violation of the Guidelines and Prohibitions.
This can serve as a reminder to all of us that the free exchange of ideas and opinions in a civil manner, like most worthy goals, requires effort to achieve.
Goldsun
totalamateur
We offer political asylum!
The real "New Economy" must be the one with gold at the center, not the Internet/technology bubble they are touting all the time in the media. They have simply jumped the gun, you might say!

That the American paper tiger, the dollar is doomed and destined for a total collapse (after maybe even still more inflation?) is a sure thing. Not many people in the know doubt that side of the story. The benefits of then holding gold/Euros will be obvious to all. And the sad loss for all the ones still holding dollars will be equally evident. But what is not clear to me is: What about all the ones having a debt in dollars at the time of the dollar collapse? Will they not also be able to celebrate and rejoice? All the ones that have borrowed dollars and let's say bought physical gold or invested in the Euro zone, will they not be winners? If not, then why not? They should then be able to easily buy worthless dollars and pay back their debt and will (as the Americans say) have made a killing, won't they? Or could they come up with a "new dollar" and demand that loans given in old dollars be repaid with so and so many new dollars? What is exactly the situation here? I think there will be a lot of people and countries in this kind of a situation, and it would just be nice to know the answer.

Please, does this reasoning makes sense or are there flaws in this thinking? In other words wouldn't it be a brilliant idea for me now to borrow a heap of dollars and buy gold? Would I come out a winner? Or are there snakes in the grass somewhere? I am just an amateur in this game of international finance!

What FOA states is that the Euro being "backed" by gold as a reserve asset is stronger than a mere fixing of the currency to gold is gradually sinking in with me, even though I cannot fully grasp that anything could be better than a currency either being gold or next best directly convertible to gold which truly is the only real thing! Even Euro notes as good as they may be or rather become, are still only paper with ink stains on them, aren't they? I thought gold was gold and that's it and nothing could possibly be better! Paper can always be monkeyed with, as we have more than enough proof of, but gold is near impossible to tamper with, although even the Deutsche Bank, I am pretty sure it was, once bought lead painted with nice yellow paint! Is one problem that gold (and silver which would do nicely for the smaller denominations) coins are thought of as impractical? And is another consideration that there seemingly is not enough gold to go around for everyone to have a few in their pocket? I think if we got the gold out of the vaults and into circulation, there would be plenty for everybody. What did Gandhi say: "The World had enough for every man's need, but not enough for every man's greed!" Well, this is another subject; men in this day and age do not share voluntarily, sad to say. They will soon have to, but they will have lost the blessing and reward for doing it while it was still optional. But back to the subject: What is the problem with the old gold standard? It worked before, could it not work again?

If it is so that the ECB had committed itself to have a certain percentage or their reserves (15%) in gold in storage for every Euro printed, then this sounds pretty much like the old gold standard to me, where each currency unit represented a certain amount of gold. Wherein exactly lies the difference? And what exactly does it mean that the Euro is structured to take advantage of a rising price in gold? Could someone please take the time to elaborate on these issues as I am sure many other readers also have a problem grasping these "new and strange truths"!

Another question comes to mind: At what point in time will the ECB dispose of their dollar reserves, of which they have quite a bit? I bet they will not announce it before it is completed! If 15% of the reserves is now gold, what will the remaining 85% be in the future? All gold? As far as I can see there will be nothing else worth storing up as reserves! I can't see them going for Yen, which will go the way of the dollar, neither will they go for Russian rubles or Chinese Yuan!

Back to another question I posed earlier: Let's say I am the head of the sovereign, relatively small state of Aurora, a non euro zone country that wants to be wise and on the right side of these things when the dollar gives up the ghost, the Euro rises and gold reigns king in economics again, what should I do today to play my hand right? What advice should be given me?

Should I start buying gold quietly, while moving out of dollars and dollar based paper?

Should I run up as big a debt as possible in dollars waiting for the dollar to collapse?

If I have pegged my currency to the dollar should I peg it to the Euro instead?

What would happen to the price of gold if I suddenly declared:

"Hear ye, hear ye, as of today we, the country of Aurora, are on the gold standard! Our monetary unit, the "Money" is from today qual to 1/X ounze of pure gold."

What would be the effect of this announcement on the price of gold and on the international community in general?

I humbly await the thoughts of the forum on these issues and make a solemn promise that we will take no such drastic actions until all forum readers have had time to adjust their portfolios! Thank you for your valuable input! The best suggestions and answers will be rewarded with political asylum in Aurora for as long as you wish to abide with it's gentle, truth-seeking and peace-loving people!
White Hills
Dollars coming home
On CNBC this morning they had extensive list of European companies bidding for and buying American companies at an increased rate over the usual buy outs. Are these companies using dollars? It would be one way to return Dollars to US without looking like they were being dumped.White Hills
Knallgold
@White Hills
Yes,cabal member UBS bought PaineWebber with worthless Dollars...
JavaMan
USAGold, you said...
http://cbs.marketwatch.com/archive/20000711/news/current/kellner.htx?source=htx/http2_mw"Those of you who discounted my observation yesterday -- that nothing much is going to change this year with respect to Fed policy due to the election year -- should take into account yesterday's comments from Alan Greenspan that "job insecurity" would act as a talisman to keep wages down."

Interesting discrepancy between Greenspans� take on job security, or the lack thereof, compared to the link above.

"What's more, they are putting their money where their mouths are. The Federal Reserve reports that people borrowed in May at the fastest pace of the year, with consumer credit rising nearly $12 billion. Now let me tell you, fans, people don't usually go into hock like this unless they are confident that they can repay these loans.

What's behind the confidence? Jobs, plain and simple. The unemployment rate has averaged four percent so far this year -- the lowest in three decades."
leonard
RE to Tamzarian
i agree with your post yesterday 100%,way do some people feer the truth so much.
White Hills
totalamateur #33407
I don't think the ECB intends to keep any currency as reserves but their own. Why would they keep a currency that is inflating as a reserve? Why not just increase the % of gold to Currency and let the free market decide the value of their currency. White Hills
TownCrier
Results of the UK auction with an allotment analysis from The Tower
Press Release: H M Government Gold Auction Result: 12 July 2000
The Bank of England announces that the gold on offer (approximately 25 tonnes or 803,600 ounces) has been allotted in full at a price of $279.75 per ounce. Details of the result are as follows:

Amount of gold on offer (approx.) 803,600 oz
Amount applied for 1,046,400 oz
Times covered 1.3 times
Amount allotted to bidders 804,000 oz
Allotment price $279.75
Scaling factor at allotment price 2.6667%

---[[[The Tower's analysis: If it is any consolation, nearly the full 25 tonnes of this offered gold was bid for at a higher price, and further, the low allotment-price bidder didn't get much of his order filled. Meaning, by the time much of the gold had been assigned to the higher bids, when the one bid at $279.75 was reached, there was only enough gold left to satisfy less than 3 percent of this bidder's requested amount.
+
Specifically, of the 2009 London Good Delivery bars offered (weighing approximately 400 troy ounces each), 2001 of them were bid for at a HIGHER price, only 315 bars were bid for at a lower price, and 300 bars were requested in the exhaustion-bid which became the allotment price (@ $279.75) for all successful bidders.
+
By the way, on that single bid for 300 bars, the poor chap received only nine bars as a result of his frugality, whereas the higher bidders got everything they asked for...and at the same nice price. Fair is fair. Now, back to the press release...]]]---

All accepted bids which were made at prices above the allotment price have been allotted in full at the allotment price. Valid bids made at the allotment price have been allotted an amount of gold equal to the amount bid for multiplied by the above scaling factor and rounded up to the nearest 400 ounces.

By close of business in London today, applicants whose bids have been successful in whole or in part will be notified by the Bank of England of the exact weight of the gold bars allotted to them and the amount payable in respect of their purchase. Payment must be made in US dollars to the Bank of England's account at the Federal Reserve Bank of New York, no later than 12 noon New York time on 14 July 2000.

On 3 March 2000 , H M Treasury announced that, the Bank of England, on behalf of HM Treasury, is to sell approximately 150 tonnes of gold from the Exchange Equalisation Account in a programme of six auctions of around 25 tonnes each in the financial year 2000/2001 on the terms and conditions set out in an Information Memorandum which was published on 3 March 2000. This is the second auction in the programme of six. It is intended that the next two auctions will be held on Tuesday 19 September and on Tuesday 7 November 2000. The remaining auctions will be held on dates to be announced in January and March 2001.
Buena Fe
oilgoldoilgoldoilgold
http://cbs.marketwatch.com/archive/20000712/news/current/crude.htx?source=htx/http2_mwDoubts about output hike boost oil
"This is a classic case of �don't count your barrels until they're pumped," commented Phil Flynn, a senior energy analyst at Alaron.com.


HI - HAT
White Hills++Knallgold++ORO__________Dollar Homecoming
New Age Will Get OldPerhaps the Political - Econo- Banking - intelligensia have concluded that the Nation will carry forth into the new age future with a sophisticated high tech, high stakes shell game, in order to keep the cornocopia showering down on the American People.

I think not.

After the real all-time highs in the 1960's we have really rather detereorated.

From shutting gold window to liquidation of agriculture, then Carter-Volcher liquidated manufacturing and dismantled and sold core rust belt tooling to foriegn interests.

Now we have dollars coming back in and buying toll-key service industries, plus forestry companies, etc..

This will become a National security issue when the traiterous Political Class panics over their disasterous National Stewardship.
HI - HAT
Moral Bankruptcy
Ladies and Gentleman if anyone harbors a hope that with the coming "adjustments", the US leadership will rise to the occasion and repent at the Jefferson Monument, THINK AGAIN>

A trend in motion will continue, until it is decisevly broken.

These people are demagogues and are morally bankrupt. They pander, not lead. The hollywood, banking, politicos, media BIG BUSINESS sponser a GOEBBELS like propaganda machine that has slipped over into virtual reality.

Witness the moronic NY State Congressman wishing to sue the OPEC for monopoly. Witness the "commander in chief", pandering to the NE with the strategic oil reserve.

When things fall apart, there is no telling what wild laws will be enacted,(foriegn exchange controls, etc.

Hope if you must that you are doing the best you can to safeguard your own posterity.

That is why with every other card a JOKER, in a marked deck, gold hedges moral bankruptcy.
HI - HAT
INFLATION SNOW BALL
The direct result, basically right now of the ascendance of the FIAT paper regime World-Wide is a demand-supply imbalance, like present in oil over a whole panopoly of commodities and services.

Once the Zietgeist of the day takes the inflation bit in its mouth, it is very hard to break the psychology of it.

The Trail horse got a whiff of the stables and is going to make a mad bolt for it.
Canuck
@ Stranger
http://www.publicdebt.treas.gov/opd/opdpenny.htm7/11/00 The Public Debt $5.665 trillion (and change)
-----------------------------------------------------
Howdy Stranger, how are you.

I'm going to re-read the trade deficit article again. Thanks for your thanks.

It seems 'money' is at it's extremes. Graphs of deficits, debts, stock markets, margins etc., etc. seem to be at a climax. Is this what its all about?

I pulled up graphs today of the TSE300, Nasdaq and DJIA from inception. The Nasdaq was most notable, a near parallel
line (x-axis) for many years and suddenly a upwardly parabolic curve starting in the early/mid 90's. There is the abberation in the fall of '98 followed by the near parallel line (y-axis) in the last 8 months or so ending March 2000.

The slope of the tangent would depict the Nasdaq at 10,000 within a year. It is a disturbing curve.

I had a friend over tonight who is just getting started in the 'investment' game. I laid a ruler across my monitor from
1972 to 2000 to show him what I thought might be 'fair value' for the indices. These markets are thousands of points overvalued. We played the same game with INTC, NT, MSFT, etc. and these stocks mirror the Nasdaq. I had seen the curves before but staring at Nortel and the 'Duck' blew me away today.(again)

After a minute or so of staring at the curve I looked back at my buddy and said, "Are you going to buy into that mess?"

His reply, "Yeah, but look at the slope, it's 60 degrees" as he held the edge of his hand to the monitor.

"But for how long?", I posed, "A day, month,... a year."

"Who cares?" he blurted.

"That graph, my friend is why I buy gold. That curve my good man, is unsustainable" I paused to find him still staring at the screen. "Let me tell about what happened to the Nikkei about a decade ago"
THX-1138
Re: Shifty
Thanks for the gold panning locations.
I printed it out and will take it with me.
I also joined GPAA and am waiting on my GPAA members guide book.
Should be here soon, and I will use it and your info too hopefully strike color.


Again, thanks a big yeller heap!

THX-1138

SHIFTY
GPAA
It's a good club. I have been one of there members for many years!The info I gave you was from an old mining guide.
They even have some gold shows on the Outdoor Channel! Let us know how you do.
Black Blade
Late Call! Due to communications disruptions from lightening and high winds.
PGM news is interesting over the last few days as the Russians and Japanese continue to lie and show they have no honor!THE EASTERN FRONT:

Japan seeks new platinum sources

TOKYO Because of inconsistent shipments, Japanese buyers are expected to reduce their dependence on Russian platinum group metals (PGMs) under long-term contract in 2000, say some buyer sources. Russia's export agency Almazyuvelirexport (Almaz) and Japanese buyers have been negotiating the terms of the 2000 shipment for PGMs by fax over the past few days, they say. The sources suggest that Japanese buyers can no longer rely on Almaz's supplies under long-term contract as its PGM shipment schedule has been unreliable over the past few years. The two sides are expected to leave the price formula for the 2000 shipment unchanged from 1999, and shipments could start next month or later, they say. In 1999, the two sides set the price according to the average London fix price of the month before the deliveries started. They say that Japanese end users have developed other PGM sources in the international market following unstable supplies from Russia over the past few years. Some buyers have already reduced Russian PGM purchases under long-term contract. In the past few years, Russia did not start PGM deliveries under long-term contract to Japan until the second half of the year for internal reasons. Japan's platinum and palladium demands account for about 30% and 25% of world demand. Although Japanese buyers may no longer rely on Almaz's PGM supplies under long-term contract, they want to maintain a good relationship with Russia the largest palladium and second largest platinum supplier in the world as PGM demand in Japan is expected to remain steady in the future, the sources say. Many expect that Russia will not be able to supply sufficient levels of PGMs for export under long-term contract in the future. The Central Bank of Russia and the country's state depository for precious metals (Gokhran) have said they would not export sufficient PGMs in 2000, according to earlier reports. Russia's major PGM producer, Norilsk Nickel, which aims to improve its sales operations in Europe and the US, could be the only stable Russian PGM supplier in the future, the sources say. They say most of Russia's PGM stockpiles are believed to be held by European banks as collateral for loans. A trader says: "Russia is unlikely, also, to sell large amounts of PGMs in the spot market as such sales could depress prices. "Russia earns leasing fees and receives loans by using the PGM stockpile (at present)." BridgeNews. Jul 12 2000 12:00:00:000AM Business Day 1st Edition

Black Blade: As anyone who has read my postings for the last few months know, I've been beating this drum for some time now. The TOCOM and Russians have been trying to pull the wool over everyone's eyes about the PGM situation for some time. The Russians don't have the ability to meet demand. The Japanese have been cheating investors via the TOCOM by defaulting (so much for honor and all that garbage). Russia won't likely become a major contributor of PGMs until they give up the Soviet era style economy. They still don't understand what a free-market is. They may have to take lessons from their criminals ;-)

Norilsk Nickel says considers Japanese cos long term partners

Moscow--July 11--Norilsk Nickel, the Russian metals giant, said Tuesday it still considered major Japanese companies its long term buyers of platinum group metals (PGM). The company's spokesman Anatoly Komrakov said market rumors about the Japanese buyers' plans to reduce dependency on Russian PGM supplies were coming from market speculators. (Story .17631)

Black Blade: And what great partners they are too! One can't deliver the merchandise, and the other cheats its investors. These guys really do deserve each other.

Gold auction not fazing Australian industry

The Australian gold industry is not worried by the Bank of England's latest gold auction today. Producers and analysts say the past six sales of the UK treasury's store of bullion have had little effect on the gold price. The bank's decision in May last year to sell 415 tonnes of the yellow metal has raised an average price of $US276 an ounce with the highest price being $US293.Resources analyst with Bell Securities, Keith Good, says the market's aim is to see gold rally to above $US290 an ounce for a sustained period. The managing director of Sons of Gwalia, Mark Koutofani, says the company certainly is not expecting any excitement from the auction. "One's not sure whether the market has already anticipated the auction or the auction actually drives the market, but we wouldn't expect to see a major deviation, certainly around the spot price would be the expectation," he said.

Black Blade: Take these statements however you wish. Sons of Gwalia is heavily hedged and has no desire to see the POG rise substantially. As a result, no one is expecting any excitement from the companies share price either.

THE WESTERN FRONT:

Austrian Central Bank confirms 30-tonne gold forward sale

London--July 11--The Austrian Central Bank confirmed Tuesday the forward sale in March of 30 tonnes of gold which was recorded in this week's European Central Bank balance sheet figures. An ACB official said the bank had an allowance to sell a further 60 tonnes as part of the Washington Accord--in which 15 European Central Banks agreed to limit further official sector sales and lending. (Story .18926)

Black Blade: There was about 320 tonnes that were not accounted for in the WA over the 5 year moratorium. Looks like we found about 10% is from Austria, however, the Austrians have been selling all along - to themselves! They sell to the state mint for the manufacture of philharmonics, etc. A similar situation as to the US Mint's gold eagle program. Nothing new here except to try to spin a negative angle about gold sales.

Analysts not optimistic for gold ahead of BOE auction

London--July 11--The approach of the seventh Bank of England 25-tonne gold auction has brought the market to a "grinding" halt in anticipation of the event and even a 30-tonne sell-off by an undisclosed member of the European Central Bank Tuesday didn't make an impression on the market. Given "a certain strangulation in the market over the past few weeks," traders and analysts said, the auction has become a much greater factor in any potential movement either side of the U.S. $282-90 range spot metal has held since the beginning of June. (Story .18576)

Black Blade: More drivel!

SWISS GOLD: SNB reserves down 105 mln Sfr to 38.292 bln Sfr

Zurich--July 11--The Swiss National Bank disposed of 105 million Swiss francs' worth of its gold reserves in the first 10 days of July, it announced Tuesday. This is roughly equivalent to seven tonnes, which puts the SNB's latest disposal below analysts' expectations of one tonne daily until end-September, when new quotas take effect. (Story .13000)

Black Blade: Slowing sales from Swiss NB? I guess they need a new Swiss Miss ad campaign. "With each ton of chocolate, get an ounce of gold!"

CPM sees platinum, palladium prices remaining strong, volatile

New York--July 11--After their recent jumps, platinum, palladium and rhodium prices will stay strong, with the fundamentals pointing to them remaining at high levels or even climbing over the next year or so, said Jeffrey Christian, analyst at New York-based CPM Group. (Story .17838)

Black Blade: No kidding!

Black Blade
@SHIFTY and THX-1138
If you get a chance, the Boulder Creek area between Bonners Ferry, ID (Molinine(?) Falls) and Troy, MT should be good panning, I did a bit of research in the area for a major miner a few years back, and had a fair amount of success. Look out for bear (Grizzly and Black), I also had some encounters with them as well. Some Enviro-nuts thought it would be cute to plant a few bear to enhance the natural flavor. Also, help yourself to some wild huckleberries, black berries, and raspberries while there. Accessability is somewhat limited as it is gated off to motorized vehicles unless you're one of the elite (forest service, etc.). There is an old abandoned and caved underground mine there that isn't on any new maps of the area. Great country and also decent trout fishing.
TownCrier
Sir Black Blade, what do you mean by this?
"There was about 320 tonnes that were not accounted for in the WA over the 5 year moratorium."
---
Are you suggesting that the total "commitments" of nations have gone over the Washington Agreement sum of 2000 tonnes? Or are you saying that the Washington Agreement had room for 320 tonnes, of which the Austrians are now part of?

My math works better the latter way, but the entirety of the 2000 tonne mobilization has been committed, putting them perhaps just a shade over. We'll offer more on this upon seeing your reply...
TheStranger
Rally Time?
Canuck - thanks for your thanks, too. I share your frustration with the markets but allow me to offer a different perspective. As you know, the unweighted indices (ie. the average stock) peaked out in the U.S. over two years ago. Gold, on the other hand, actually appears to have put in a major long term bottom shortly thereafter.

Many players see a window of opportunity in the current environment. They think the dire earnings warnings for this quarter are now behind us. They also believe that government reports of inflation and growth can and will be successfully managed until after the election. Supposedly, the reasoning goes, Greenspan will have no reason or desire for further rate increases during this period. Perhaps this represents clear thinking. I don't know.

But it would be a mistake to believe that all the stock market lemmings are making money lately. While the stocks of some full service brokerage houses made new highs just today, most online firms are struggling. This, no doubt, is because many people, like your friend perhaps, have underestimated the challenge and are going it alone. Meanwhile, some honest and experienced brokers I know are performing an important function by protecting clients from the common mistake of chasing performance.

We shall see where all this comes out, but I am happy right where I am.

*****

All - On another matter, while I was out cruising on my motorcycle today, a couple of beautiful young women in a pick-up came up beside me and hollered, "WE LOVE YOUR HELMET!"

At first, I thought, "what the..?" But then it came to me. Many months ago, borrowing a phrase I picked up here at the forum, I carefully spelled out a message on the back of my helmet. In big bold letters, the message reads, "GOT GOLD?"

By golly, somebody noticed!

TownCrier
Courtesy of Sir Leland, who's on the road but sent this link to The Tower by e-mail
http://www.forbes.com/forbesglobal/00/0724/0314048a.htmThanks, Leland. We're sure Sir Stranger will greatly appreciate the message. Here are some of the highlights we picked out of this article from Forbes' interview with Leigh Goehring who manages over $400 million worth of metals, energy, and paper stocks for Prudential....

HEADLINE: Gold at $2,500?

To begins, Mr. Goehring says, "I am a raging bull when it comes to gold," and continues, "In times of inflation, people always end up just gravitating to it." Citing economic stirrings from Russia and the revitalizing Asian countries and their subsequent demand on real commodities, he goes on to say, "The period where the U.S. economy could expand without fear of inflation is quickly coming to an end," recommending that each investor hold up to 20% of their total portfolio in commodity-related stocks.

Saying that mining stocks are the best way to play gold, Mr. Goehring cites Newmont and Harmony as his favorites. He also goes on to talk about the bright prospects for such commodities as aluminum and crude oil.

Having said that bit about mining stocks, interestingly enough, you'll want to pay close attention to this final paragraph from this Forbes article:

---"Say this for Leigh Goehring, he practices what he preaches. "My money is where my mouth is: 100% of my personal portfolio is in commodity-related investments," he says, pulling out a recent bill for the storage of his personal gold and silver bullion holdings."---

One bright guy, that one. We like him.
SHIFTY
Robert Service
The Cow Juice CureThe Cow Juice Cure

The clover was in bloom, an' the year was at the June,
When Flap-jack Billy hit the town , likewise O'Flynn's saloon.
The frost was on the fodder an' the wind was growin' keen,
When Billy got to seein' snakes in Sullivan's shebeen.

Then in meandered Deep-hole Dan, once comrade of the cup:
" Oh Billy , for the love of Mike, why don't ye sober up?
I've got the gorgus recipay, ' tis smooth an ' slick as silk-
Jest quit yer strangle-holt on hooch, an' irrigate with milk.

Lackteeal flooid is the lubrication you require;
Yer nervus frame-up's like a bunch of snarled piano wire.
You want to get it coated up with addypose tishoo,
So 's it will work elastic-like , an' milk's the dope for you."

Well , Billy was complyable, in a month it's strange,
That cow-juice seemed to oppyrate a most amazin' change.

" Call up the water wagon, Dan an' book my seat"
sez he.
"Tis mighty queer," sez Deep-hole dan, " twas just the same with me."
They shanghaied little Tim O'Shane, they cached him
safe away,
An' though he objurgated some , they " cured" him night and day;
An ' pretty soon there came the change amazin' to explain:
" I'll never take another drink," sez Timothy O'Shane.
They tried it out on Spike Muldoon, that topper of renown;
They put it over Grouch McGraw, the terror of the town.
They roped in "tanks" from far and near, an' every test was sure,
An' like a flame there ran the fame of Deep-hole's Cow-juice Cure.

"It's mighty queer," sez Deep-hole Dan, " Im puzzled
through and through:
It's only milk from Riley's ranch, no other milk will do."
An' it jest happened on that night with no predictive plan,
He left some milk from Riley's ranch a settin' in a pan;
An' picture his amazement when he poured that milk
next day-
There in the bottom of the pan a dozen "colours" lay.

" Well, what d'ye know ' bout that, " sez Dan; " Gosh ding
my dasted eyes,
We've been an' had the gold cure, Bill an' none of us
was wise.
The milk's free millin' that's a cinch; there's colours
everywhere.
Now, let us figger this thing out-how does the dust
git there?

'Gold from the grass -roots down,' they say-- why, Bill!
we've got it cold-
Them cows what nibbles up the grass, jest nibbles up the
gold.
We're blasted ,bloomin millionaires; dissemble an' lie
low:
We'll follow them gold - bearin' cows , an'prospect where
they go".

An' so it came to pass , fer weeks them miners might be
found
A-sneakin' round on Riley's ranch, an' snipin at the ground;
Till even Riley stops an' stares, an' presently allows:
" Them boys appear to take a mighty interest in cows."
An' night an' day they shadowed each auriferous bovine,
An' panned the grass -roots on there trail, yet nivver gold
they seen.

An' all that season, secret-like , they worked an' nothin'
found;
An' there was colours in the milk, but none was in the
ground.
An' mighty desperatewas they,an' down upon there luck,
When sudden , inspirationlike, the sorce of it they struck.
An' were d'ye think they traced it too? it grieves my
heart to tell-
In the black sand of that wicked milkmans
well.


Rugen
The Stranger 35424
The young woman probably was thinking of a more intoxicating form of Gold than You.View Yesterday's Discussion.

Black Blade
@TC 320 tonnes, oops!
You're right! I had forgotten about the Dutch selling 300 tonnes of gold Dec. 6, 1999. So let's add this up. The Swiss are selling 1300 tonnes, Uk 365 tonnes, the Dutch sold 300 tonnes, for a total 1965 tonnes. The UK commited to 415 tonnes, but 365 tonnes fell under the WA at the time of signing. Now with the Austrians selling 30 tonnes, thats 1995 tonnes, 5 tonnes short of the WA. Part of the error was that I had forgotten about the Dec. 6, 1999 Dutch sale, Oops! They were off my radar screen, but then again a good portion of the country is below sea-level (outta sight, outta mind?). I thought that maybe Belgium may have sold a small amout as well, but I don't recall. The WA signatories are perilously close to going over the 2000 tonne allotment. Of course, it would not be all that surprising to see some country begin cheating OPEC-style. Time will tell.

Black Blade
Excerpt from WGC review of the WA
http://www.gold.org/Gra/Pr/Wr991006.htm� Who will be selling the 2000 tonnes?

The Agreement limits gold sales to a maximum of approximately 400 tonnes a year and a total of 2000 tonnes in the five-year period. Only sales that have already been decided on can go ahead.

Of this total, 1,300 tonnes is allocated to the Swiss and 365 to the UK, with approx 335 tonnes for a country or countries that have already decided to sell but not as yet made an announcement. Market speculation currently suggests this is likely to be the Netherlands, or Belgium.

We understand that the quotas are not transferable, i.e. if the Swiss decide not to sell 1300 tonnes in the next five years but instead only 1000 tonnes, then no other institution can sell the remaining 300 tonnes. On the other hand, we have also been informed on good authority that the intention to sell 2,000 tonnes will be fulfilled.

Black Blade
Gold Gloom and Doom!
http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B28025691A004A241B?OpenDocumentDisenchanted funds could dump gold following dismal UK auction

Commodity funds and other investors are expected to bale out of gold following the worst ever UK gold auction.

The Bank of England said that the seventh auction of 25 metric tons or 803,600 ounces were allotted at the dismal price of $279.75 per ounce. This compares with the Wednesday morning fix price of $282.85 and the discount of $3.10 shocked the market, causing the price to dip to $280. In the majority of previous auctions the allotment price was at a small premium to market levels and at worst a 50 cent discount.

Even more significant, the auction was only 1.3 times oversubscribed, illustrating that demand is weak said a London bullion manager. He blamed the Northern hemisphere summer months and slack physical demand and interest.

Illustrating the torpid state of the gold market, The London Bullion Market Association said that the daily average volume on the London market amounted to 28.2 million ounces in June. This was 10.5% higher in May levels and the highest for the year. Sounds encouraging until you look back and find that in 1997 daily volumes were 35 to 40 million ounces. In 1998 and 1999 daily trade was also over 30 million ounces.

The fear now is that The futures funds which were buyers of gold derivatives in recent weeks and caused volumes to rise last month, will be forced to cut losses and dump metal. There is thus a risk that gold could sink back to the depressed $270 to $280 range again.

The next two UK auctions will be held on Tuesday 19 September and on Tuesday 7 November 2000. The remainder in January and March 2001. The bank has thus sold 25 out of 150 tons in the current round of six auctions. In the previous auction cycle it also sold 150 tons.

Meanwhile the Bank of Switzerland has been far more successful in selling its quota of 150 tons than its British counterpart. It offloads bullion by selling regularly at the London fix without disrupting the market. The Bank of Canada also sold some gold recently without any impact. Gold is forecast to average $288.08 an ounce this year, or 3.4% higher than 1999, according to a Reuters poll of 22 mainly stockbroking analysts. They predict it will rise to $302 next year.
By: Neil Behrmann

Black Blade: I love a sale! Dump it all and get it over with, then those who appreciate it will get it cheap. When the tide turns and the POG rises, the CBs will look somewhat foolish. Just like the BOE and Labour will. I love to see the BOE get low prices, it gives me that warm fuzzy feeling all over.

TownCrier
A summary look at the UK auction, official sales, and market expectations
Wednesday's gold auction in the UK probably looked depressing to the aspiring gold bulls out there. Certainly, at an allotment price of $279.75 compared to the London AM Gold fix at $282.85 per oz, and oversubscribed by only 1.3 times (the lowest of the seven auctions held thus far) it might look downright weak or bearish to the untrained eye. If several factors are considered, however, the outcome looks considerably more favorable.

First, consider the season. In a Bridge News article, David Meger, senior metals analyst at Alaron Trading was reported to say, "We typically look for dips in gold in July and August." This is consistent with the reflections of Michael Kosares of Centennial Precious Metals, who reported in the latest USAGOLD Daily Market Report, "The gold market is generally quiet this time of year -- a seasonal thing -- and one should not read too much into this morning's results. At the same time I wouldn't be surprised to see New York traders take advantage of the slow season as well as the BOE results to drive the futures' prices lower."

In the background, some market players are probably considering the allocations of the Swiss gold currently being orchestrated through the Bank for International Settlements at an approximate rate of one tonne per day. In addition, the weekly financial statement of the European Central Bank released on Tuesday (the day before the auction) revealed that their total gold assets had been reduced by 30 tonnes from the prior week...a product of more allocations through the BIS. [More on those items shortly.]

Yet, in spite of the typical slowness of the season, and the apparent "abundance" of official metal "issuing forth", (not to mention the current strengthening of the dollar,) consider our following breakdown of the auction bids.

Of the 804,000 ounces alloted,
the vast majority, 800,400 ounces, were bid for at prices ABOVE the allotment price;
there was one single bid for 120,000 ounces AT the $279.75 price (they only received 3,600 ounces);
and there were futile/wishful attempts for 126,000 ounces at LOWER bids.

To more fully develop a comment raised with Sir Black Blade on the official-sector European-based gold sales governed by the Washington Agreement, the 30 tonne decline in ECB gold assets was actually sold forward through the BIS by the National Bank of Austria back in 1999, and was finally delivered last week. As a result of this latest "sale" the total gold assets of the Euro System of Central Banks declined by 277 million euros to stand at 120.9 billion. To put that value into some additional perspective, now consider this from the previous week...as a result of the June 30th quarterly revaluation of the Eurosystem gold assets, they enjoyed a whopping 5.511 Billion euro increase in the value of their total gold holdings...simply from their mark-to-market operation with an unchanged amount of gold.

As for their paper foreign exhange assets, two weeks ago when they enjoyed the five and a half billion euro increase in gold, their net paper assets declined by 500 million euros that week. And again last week, even as the long awaited 30 tonne gold delivery reduced the gold asset value by 277 million euros, their paper foreign exchange assets were reduced by yet another 200 million euros.

To summarize the breakdown of national involvement in the Washington Agreement gold mobilizations of 400 tonnes for each of the next five years until September 2004...

Within this first year to the end of September, 2000:

100 tonnes by The Netherlands were already allocated through the BIS. This was done without fanfare during a 12 week period spanning December to February. They have indicated 300 tonnes in total will be handled in this manner during the life of the WA.

150 tonnes being auctioned (125 tonnes now done) by England, who auctioned 50 tonnes prior to the Sept. signing of the WA. They have indicated that a total of 365 tonnes are to be auctioned under the life of the WA.

120 tonnes by Switzerland are currently being allocated without fanfare through the BIS at nearly one tonne per day. They have indicated that 1300 tonnes total are to be allocated via the BIS throughout the duration of the WA.

30 tonnes by Austria have now been delivered, sold forward in 1999 through the BIS. They have indicated that up to a total of 90 tonnes would be allocated in this fashion during the lifespan of the WA...a significant amount of it going toward feeding the renowned Munze Osterreich (Austrian Mint).

As you can see, the full 400 tonnes for this year are well accounted for, yet the five-year total seems to have run a bit on the heavy side, weighing in at 55 tonnes over the 2000 tonne target. We wonder who goofed up the math? Giving a nod to the location in which the Agreement was finalized, perhaps we'll just blame it on those notorious government-issue pencils so common within the D.C. beltway that never seem to deliver reliable numbers.
TownCrier
Hello Sir Black Blade
The candle in The Tower has been growing dim as we've worked to make final preparations for the on-line distribution of this month's newsletter (July, 2000) News & Views, and as a result, I didn't see your latest posts prior to assembling and submitting my last one. You certainly covered the bases nicely, and thereby rendered my post redundant, if not outright obsolete. Good show!
Black Blade
@Town Crier
Thanks for pointing out the numbers. I was not aware of an additional 60 tonnes from the Austrians, but it seems reasonable I suppose. Especially since the coinage (philharmonics) are increasingly popular. This additional gold would seem to be necessary to meet demand. Better to return gold to the people than shuffle it between bank vaults in a never-ending game of musical chairs along with the incessant drivel about gold sales. Now one wonders if this will be considered a "green-light" to ignore the WA. After all, it is more of a gentlemans agreement than an official treaty.
Canuck
@ Stranger
You are a radical!!

As BB might say...Hmmmm...interesting way to attract the young female lemmings!! Ha Ha!!


6:20 Eastern and the golden sun blinds this Thursday morn.

The 'crash' lurks??

Get a helmet!!
TownCrier
Sir Black Blade and the WA
"Now one wonders if this will be considered a "green-light" to ignore the WA. After all, it is more of a gentleman's agreement than an official treaty."

No chance of "green light" as I see it. And should an unforeseen situation develop such that a signatory to the agreement had a financial crunch such that a distress sale might remedy the problem, arrangements with the ECB would likely be made such that other options are arranged. Gold IN the vault is better than gold OUT of it and they know it, that much is clear. With the exception of the BOE sales, the clue behind much of the other WA mobilization activity is likely revealed in the name of the bank through which the allocations are taking place...that being the BIS. Likely long overdue settlements and position squaring now made feasible by the introduction of a viable euro currency. No one in their right mind would settle up with gold while the dollar was yet vigorously being nursed and watched by everyone in intensive care. But now that the plug has been pulled, the "nurses" can finally attend again to their suspended duties, even as the familiar paper patient is still warm with the appearance of life. It's only a matter of time.

Regarding the "gentleman's agreement", wouldn't it be nice if EVERYONE paused for a few moments in their busy day to mull over the profound significance and implications of this agreement? Such gentlemen (central bankers) with heavy responsibilities like to leave options open to facilitate policy flexibility, and do not unnecessarily bind their own hands behind their backs. They did not HAVE to do this. The very fact that they DID speaks volumes. They sent a message. And fortunately, it doesn't take a fancy decoder ring to decipher it.
wolavka
s j kaplan
he's on the right target again...
Black Blade
Sun Eruption Causes Radio Blackouts
http://dailynews.yahoo.com/htx/ap/20000712/sc/solar_eruption_1.htmlSolar flares have been playing havoc with radio links lately and are expected to continue for awhile. Since I am in a rural (extremely rural) area and my internet link is via microwave, I may be experiencing connection difficulties. The story at the link covers this problem. Others may also experience similar situations.
Black Blade
Morning Wakeup Call!
THE EASTERN FRONT:

Asia Precious Metals Review: Spot gold stabilizes in Asia
By Polly Yam and Mari Iwata in Tokyo, BridgeNews

Hong Kong--July 13--The price of spot gold stabilized in Asia on Thursday after falling in the U.S. and European markets on Wednesday in reaction to the lower-than-expected selling price at the Bank of England's 25-tonne gold auction, dealers said. Trading of gold remained sluggish in Asia Thursday as the auction failed to indicate near-term price direction, they said.

UK's BOE gold auction fails to indicate near-term price direction

Hong Kong--July 13--Spot gold's near-term direction remains unclear after the U.K.'s Bank of England sold at auction Wednesday 803,600 ounces, or around 25 tonnes, of gold at a lower-than-expected U.S.$279.75 per ounce, dealers said Thursday. Spot gold is expected to continue to move within a narrow band of
between $278 and $283 per ounce in the near term due to a lack of both interest from speculators and physical demand, they said. (Story .10356)

Black Blade: Ho Hum. The narrow band theory? I want the rubber band theory!

THE WESTERN FRONT:

All quiet on the western front!

Meanwhile, S&P Futures are up +1.70, fair value +1.19, indicating a slightly positive open on Wall Street at these levels. Au is up +$0.90 at $281.20, Ag unchanged at $4.94, Pt up +$2.00 at $554.00, and Pd up +$.1.00 at $669.00. Oil is up $0.13 at $30.45/bbl as Venezuela and Kuwait have hinted that production may not increase after all. These guys can't seem to stick to a good story, can they?
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 12, 2000

Rates for Tuesday, July 11, 2000

Federal funds 6.39

Treasury constant maturities:
3-month 6.10
10-year 6.05
20-year 6.23
30-year 5.89

upside-down spread FF vs long bond = (0.50%)
Buena Fe
J.P. Morgan 2nd-Qtr Net Up 7.5% on Investing, Trading
http://www.bloomberg.com/bbn/topsum.html?s=AOW3GvhP8Si5QLiBN"New York, July 13 (Bloomberg) -- J.P. Morgan & Co.'s second- quarter earnings unexpectedly rose 7.5 percent after trading for its own account reaped a windfall for the fifth-largest U.S. bank."

How hard can it be if you have access to insider info.....?
USAGOLD
Today's Report: All on Hold for PPI
7/13/00 Indications
�Current
�Change
Gold August Comex
281.80
+0.40
Silver July Comex
5.04
+0.02
30 Yr TBond Sept CBOT
98~04
+0~19
Dollar Index June NYBOT
108.28
+0.46


USAGOLD MARKET REPORT (7/12/00): Gold was level early in New
York with light short covering being the chief feature. FWN
reports that dealers were both "surprised" and "impressed" that
gold held its ground following the reduced interest in the Bank of
England auction. As we said yesterday, we are in the summer
doldrums for gold and the apathy in London should not have been a
surprise. At the same time, we have to register our surprise that
traders didn't take the opportunity to drive the price lower. The
commodity funds are reportedly long so the fact that they didn't
sell off the yellow might indicate they are expecting gold to
react to something and that something might very well be
inflation. The Producer Price Index will be announced later in the
day and that could be what sends gold in one direction or the
other.

That's it for today, fellow goldmeisters. See you here tomorrow.
Al Fulchino
The Stranger on a Motorcycle?
No way! Never would have predicted that. I always saw a gleaming Mercedes sedan.
CoBra(too)
Re: WA Discussion between BB & TC.
Gentlemen, the WA states the signatories interest in clarifying their intentions with respect to their gold holdings in five points.

1. Gold will remain an important element of global monetary reserves.
2. They will not enter the mkts as selleres - except already decided sales
3. Alredy decided sales will be achieved through concerted
programmmes over 5 y's. Annual sales will not exceed approx. 400 tons and total sales will not exceed 2.000 tons.
4. The signatories agreed not to expand gold leasing and use of options over the period.
5. Agreement will be reviewed after 5 y's.

Well, I for one can't see that this is not a binding agreement, though I would have felt that part of the OeNB's(Austrian National Bank)gold sales of 90 tons - 30 tons done- would be above the 2.000 allowed tons. As I was told, most of OeNB's sales are destined for the Austrian Mint - at least the public has a chance to buy cheap - it may be admissible, though I hate the further negativity induced and don't commend the wisdom of the OeNB officials - particularily since I've had a discussion about WA with one of their ranks not too long ago.
I, probably, feel more, that at the timing of WA it may have been unclear to most signatories, that major european BB's i.e. DB and UBS - while DB hugely added to the position after WA, UBS refrained from further additions (see Reg Howe) have been so heavily involved in the gold carry trade and came as a (jolting) surprise.
So, IMHO, either the WA was badly researched - at least timing wise - or a next step has to follow to hammer the point home. Gold is and always will be an important part of
monetary reserves. As this stands in total opposition to whatever the IMF stands for, or is it better termed stood for, I expect either a reinforcing step of the WA, or otherwise the ECB et al stands to lose all and any credibility.

Hope I didn't contribute to more confusion - best CB2

PS: Leigh - I'm sure you've read Daphne de Maurier's - Rebecca
Gandalf - Hobbits are friends -always!



TheStranger
Rugen, Al, Canuck, Anybody
http://home.earthlink.net/~daviddport/index.htmlIf you want to, you can check out TheStranger and his motorcycle at the above link. Trust me, it is not a pretty sight.
VanRip
Stranger's Paradise
Thank you so much, Stranger, for sharing those pictures. My old Mac gagged and sputtered for a good several minutes loading the pages, but it was well worth it. Great place. Great family. They say that living here in south Florida is paradise, but it looks as if you have it beat by a mile. Plenty of places to stash gold out there, too.
MarkeTalk
Of cycles and market turning points
Many thanks to my clients and friends who bring articles to my attention which I would otherwise miss. One such item of interest was provided by Jeff at Samex Mining. He informed me of the fact that there will be three eclipses (one lunar and two solar) in the month of July, beginning with the solar on July 1st (also a new moon), then the lunar on July 16th (also a full moon), and then finally the second solar on July 30th (another new moon). Kind of makes for a nice bracket. A little bit further on I mention why new and full moons are key to market turning points--and it is not based on astrology.

He also brought to my attention research done by Chris Carolan of Calendar Research, who has identified a cycle of major proportions. It is a 29 year and 20 day cycle which, in times past, has had a direct effect on gold. The last time this cycle hit was on August 15, 1971 when President Nixon closed the gold window and set in motion the breakdown of the fixed currency exchange rates established under Bretton Woods. Mr. Carolan documents earlier events in the 20th century when the cycle hit. If history is any guide, then we can expect some type of major announcement coming on or about July 16th (give or take 10 days).

Now combine this cycle with yesterday's UK gold auction (which usually marks a low point before a rally), tomorrow's release of the PPI numbers and next Tuesday's release of the CPI numbers (oil prices are still high despite OPEC pronouncements to the contrary), stir in a good portion of Steve Puetz' "eclipse theory" and you have the makings for a market turning point which most people are not expecting. Mr. Puetz has made a name for himself by identifying how stock and gold markets turn up or down on new and full moons when accompanied by an eclipse. I want readers to know that his work is not based on any astrology but just pure observation of market behavior. He recently refined his eclipse theory to include other factors and he now calls it the "Unified Market Theory." From his latest newsletter, it appears to have some validity. He believes that gold could stage a major rally at any time after July 5th.

I realize that all of these factors are, by themselves, speculative in nature. But, when combined in such a short time window as we are now experiencing, I believe that a synergy arises and can produce a market change despite the best efforts of Goldman Sachs, Chase, Deutsche Bank , JP Morgan, et al. Any student of market cycles has to admit their influence and validity.

Bottom line here. Just like the milk advertizing asks, I ask: Got gold?
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 13, 2000

Rates for Tuesday, July 12, 2000

Federal funds 6.38

Treasury constant maturities:
3-month 6.17
10-year 6.09
20-year 6.23
30-year 5.89

upside-down spread FF vs long bond = (0.49%)
Canuck
CRB//POO//DEBT//INFLATION//STRANGER
Bridge/CRB Current Quotes
Other Futures Markets

Bridge/CRB Index


Page snapshot Thu 13 Jul 2000 19:31 ET
Description Last Change Percent Change
Bridge CRB Futures Price Index 221.8 +3.1 +1.42 %
Bridge CRB Index 222.6 +2.78 +1.26 %
Energies

Description Last Change Percent Change
Natural Gas 4.185 +0.019 +0.46 %
Crude Oil 31.42 -0.05 -0.16 %
Unleaded Gasoline 0.97 -0.0024 -0.25 %

Canuck: CRB/Oil back on the way up.
---------------------------------------------
The Public Debt To the Penny
Current
07/12/2000 $5,664,141,886,637.91

CURRENT
MONTH AMOUNT

07/11/2000 $5,665,065,032,353.04
07/10/2000 $5,662,949,608,628.38
07/07/2000 $5,664,950,120,488.65
07/06/2000 $5,665,885,115,450.41
07/05/2000 $5,663,895,163,292.22
07/03/2000 $5,656,715,920,235.71

Canuck: The huge 'surplus' is hammering away at the debt,
to be paid off in 10 years. Ha ha!!
----------------------------------------------------
Canada announced inflation rate today; annualized rate increased from 2.4% to 2.9% (May over June)

Canuck: Increase blamed on oil. Core rate was okay. As quoted before by astute analyst "..particularly handy if you don't eat or drive" Toronto-Dominion hero starts yapping on the radio,"...as soon as oil starts dropping inflation will reverse itself.." Ah Hah, admission of guilt
you crooks, there is inflation coming. And if oil doesn't reverse itself you dick-weed. Oil has been plus $25 for many months, just about north of $30 for most of 2000. Those middle-eastern oil jockeys want your money, your gold and your skin.
------------------------------------------------------
Stranger: Wonderful site, lovely family, awesome scenery.

Where's the helmet man? The 'golden helmet'? Let's face it, gold is not going anywhere until we get a pic of The Stranger with the golden helmet. You are the Man!!
man!!

wolavka
watch soybeans silver and gold
these mkts are set to explode upward.



Al Fulchino
TheStranger and to ALL
David,

As our friend Aristotle would likely say, "You got Gold!". You have a beautiful family. Thanks for sharing. I have often wanted to make a site similar to yours as we have oodles of pictures now that we have a couple of digital cameras. The wife and daughter are on a shopping spree for our new gallery in Atlanta. Maybe when they get back I can "persuade"the young'n to put it together.


To ALL: We come together here, fairly frequently. I view this place almost as an investment club without the commitment. I also view it as a place that can foster friendship.
Black Blade
@Stranger, Nice pictures
I think I got it! You stash all your gold in the Mt. Timpanogas Caves near Provo! Good looking family too. I kind of pictured you as an outlaw biker, Hmmmm......
TheStranger
Stranger in Paradise?
Thanks Al, Canuck, Black Blade, VanRip. Maybe one day I will get to see your pictures, too. I hope so.

Al - What kind of Gallery?

VanRip - Yes, South Florida is marvelous and Utah is almost heaven. The whole world is going to see a lot more of us when the winter Olympics get here in about 19 months. I hope you'll tune in.

Canuck - You da man, too, buddy. Heck, we all da man.

Black Blade - One of these days, man...at the Dead Goat Saloon...you and me and a guy named turbohawg (if he ever shows up around here again).

Thanks to Gandalf and Cavan Man also for private messages. With friends like you guys, who needs an enema?

USAGOLD, a great place to protect one's wealth!
Black Blade
Cobra(too) and TC
http://www.goldensextant.com/commentary12.html#anchor29020This excerpt from Reg Howe suggests that some BB's within the member countries who are signatories of the WA may be scuttling the WA with lending and possibly "quiet" sales activities. Deutsche bank appears to be a major culprit according to Howe, Frank Veneroso and GATA have suggested that large amounts of official sector gold appear to be entering into the market. As far as I can tell, none of this is confirmed, but does raise a few pointed questions. One could ask if this is true, is it because of threats, change in econ. philosophy, or "if you can't beat em', join em'"? I don't see the evidence as yet, but will keep my ear to the ground.
Black Blade
@Stranger
You got it! Can't forget the ole "HarleyDavidson" poster. Now if I can only navigate the freeways since they started tearing them apart. I-15 was an ugly drive when I passed through a couple months ago. Man, I wish I still had my "Wide Glide".
Marius
Stranger photos
I never got to the picture(s) of you and your bike, thanks to my decrepit old machine & lack of patience, but your daughters will definitely break some hearts! As pretty as Utah itself. Bravo! Thanks for such a personal look into your family. It's always good to put a face to the posts.

M

(P.S. I'd much rather look at interesting women than interesting machines. Honest. Ask Mrs. M!)
SHIFTY
The Stranger
Stranger: The pictures were beautiful ! I was wondering if the lovely ladies offer a " friends of USAGOLD" discount on our flower needs?

PS , Only a true gold bug would have a link to the spot price of gold in the family photo album.
:)

$hifty
Topaz
E-Money via J-Diz@Kitco
http://www.lewrockwell.com/orig/callahan2.htmlThere "HAS" to be a role for Gold as the basis for E-Commerce. It sticks out like a sore thumb doesn't it ALAN, George et al??
So stop stuffin'round!! View Yesterday's Discussion.

wolavka
it's time
George, tried to reach you at Monson, Ma; where are you??

It's time to buy.
SteveH
Picture
www.msn.comCheck out the picture under "How to spend $1 million"

Now if that isn't irony.
Black Blade
Morning Wakeup Call! Slow news day - so far.
Sources: Bridge News, and AP business weekTHE FAR-EASTERN FRONT:

Asia Precious Metals Review: Spot gold steady at U.S. $280

Hong Kong--July 14--Spot gold steadied in Asian trade Friday at U.S. $280 per ounce on physical demand, though trading was sluggish, dealers said. Silver hovered around $4.97 per ounce for most of the day, and was also thinly traded, they said. (Story .2200)

Black Blade: Yawn.

THE AFRICAN FRONT:

AngloGold moves into the manufacture of jewellery

CAPE TOWN In a move into beneficiation, AngloGold has announced acquisition of a strategic stake in OroAfrica, SA's largest jewellery manufacturer. AngloGold, the world's largest producer, indicated yesterday this was its first venture into jewellery manufacturing, but was in line with a number of initiatives aimed at increasing its involvement in the marketing of its product worldwide. AngloGold will acquire 25% of OroAfrica for R55m. OroAfrica is 56% owned by the Nathan family, 25% by Global Capital/Investec and 19% by management and staff. It was created in 1998 by restructuring diamond jewellery manufacturer Efune Brothers, founded in 1945. OroAfrica has turnover of close to R300m, and consumes six tons of gold a year at its manufacturing facility in Cape Town. Part of the attraction for AngloGold was OroAfrica's joint venture with Italian company Filk Spa, the world's largest and most technologically advanced manufacturer of machine-made gold chains. The joint venture is for the local manufacture of gold chains for export to the US. AngloGold marketing director Kelvin Williams said this was "a significant step" in what has been a sharp learning curve for the marketing of AngloGolds product. He said AngloGold and OroAfrica had common objectives. These, he said, included achieving absolute growth in gold fabrication offtake, creating a company big enough to take up the challenge of launching a gold brand in developing markets, and creating a leading company in the sector. AngloGold would be able to play a significant developmental role in the expansion and export of gold jewellery products, and could help improve the product and marketing, especially in developed markets. Williams said OroAfrica had a track record and a vision, and its joint venture with Filk was an added attraction. AngloGold CEO Bobby Godsell said AngloGold aspired to be a leading gold company, not just in mining but in creating value. This has seen it become involved in design and sponsorships, from Face of Africa to the new Gold Avenue web site in a joint venture with the Swiss Pamp. Although the OroAfrica and Pamp deals were separate, there were clear synergies. OroAfrica CEO Steven Nathan said the company had an important joint venture with Filk and had distribution deals for major brands including Fope, Ronco and Piero Milano. In the past two years it had established manufacturing links with SA, Italy and China.

Black Blade: Not really a new strategy on the African Front of the Gold War, but one has to wonder if these strategies will bear fruit by the off-take of physical gold and it is "consumed" as jewelry. Harmony Gold does much the same with its own jewelry manufacturing and branded gold sales program. Yep, Think I'll weigh myself down with a few kilos of gold chains. Well, every little bit helps.

Zimbabwe's Venice gold mine suspends operations

Harare--July 13--Luxembourg-based Falcon Gold said on Thursday it was putting its Venice mine about 150km west of Harare, Zimbabwe, into mothballs because of the economic crisis gripping the country, the South African Press Association reported. It is the fourth gold miner to suspend operations in Zimbabwe this year. (Story .18266)

Major Zimbabwe gold producer might shut by September

Harare--July 13--One of Zimbabwe's three biggest gold mining groups said Thursday it will have to stop all operations if there is not a 50% devaluation in Zimbabwe's currency within the next two months. A pegged exchange rate at a time of soaring costs has forced Falcon Gold to close its Venice mine temporarily, leading to overall production falling by 20 kilograms a month. (Story .18243)

Black Blade: Now it looks as if Nut-Case Mugabe may actually help with keeping a few ounces off the world markets. What a shame, all that Zim currency going to waste ;-)

THE WESTERN FRONT:

Appears that there is a news blackout on the Western Front.

Meanwhile, PPI numbers due out this morning, forecasts are for a 0.6% rise, 0.1% core rate, though these are bogus numbers and AG says that he pays no attention to them, they will likely influence market action today. If the PPI surprises to the upside, then look for a bit of a breakout for the PMs. S&P Futures are currently up +3.20, fair value +3.73, indicating a modestly higher open on Wall Street , though this could change radically based on the PPI number release. Oil is down $0.08, at $31.38/bbl, still high its recent highs. OPEC Prez. Rodriguez says he knows nothing about an increase of 500,000 bbl/day. Hmmmmm��., something strange here. Anyway, it did trigger a lot of buying yesterday. Au is up +$0.80 at $280.30, Ag unchanged at $4.97, Pt down -$3.00 at $554.00, Pd up +$5.00 at $667.00.
Black Blade
PPI
http://cnnfn.cnn.com/2000/07/14/economy/economy/NEW YORK (CNNfn) - Energy price hikes drove up wholesale prices in line with forecasts in June, but core price, retail sales and industrial production measures were weaker than expected, lessening inflation concerns and helping to raise markets Friday.

The reports cheered both bonds and stock markets early Friday, who took this as a further sign that the Federal Reserve may again decline to raise interest rates when it meets next month. Both equities futures and bond prices gained in morning trading after the report.

Stan Shipley, senior economist with Merrill Lynch, told CNNfn's Before Hours program that except for energy prices it looks like the economy is cooling down, and with no inflation and slower growth the Fed will probably not raise interest rates. (356KB WAV) (356KB AIFF)

The U.S. Labor Department said the Producer Price Index measure of wholesale prices gained 0.6 percent in June. But, excluding often-volatile energy and food prices, the core rate came in 0.1 percent lower for the month.

The "core" PPI, which excludes food and energy prices, was forecast to have risen 0.1 percent, rather than the decline that was posted.

A 5.1 percent gain in energy prices, led by an 11.8 percent increase at the gas pump, was the key driver of the increase. Food prices, the other item excluded from the core PPI measure, slipped 0.3 percent.

The June numbers come after PPI was basically unchanged in May, while the core PPI posted a 0.2 percent increase in that period.

Meanwhile, the U.S. Commerce Department reported retail sales gained 0.5 percent in June, but only 0.2 percent when auto sales were excluded.

A survey by Briefing.com forecast called for an overall 0.3 percent rise in June, while seeing sales excluding autos climb 0.4 percent. Retail sales were revised to a 0.3 percent increase in May from the originally reported 0.3 percent decrease, while sales excluding autos were revised to a 0.5 percent gain from unchanged.

A third report from the Federal Reserve showed that industrial production rose 0.2 percent in the period, also below the forecast of 0.3 percent and the 0.4 percent gain posted in May.

JavaMan
SteveH, picture from your msg#: 33459
http://www.msn.com/It looks like your link may have gotten "confused". Try the link above for the picture.
Al Fulchino
Stranger, Who is not a stranger anymore
Big D in Utah,

It is a Thomas Kinkade Gallery. We have the territory from Nashua NH up to Manchester and over to Keene. Our hope is for three galleries all told. He is the number one collected artist in the US of A, beating out numbers 2-101 combined. That is probably more than you wanted to know , but thanks for asking.
USAGOLD
Today's Gold Report: Too Many Dollars Chasing Too Little Gold
http://www.usagold.com/Order_7/14/00 Indications
�Current
�Change
Gold August Comex
281.10
+0.30
Silver July Comex
5.04
nc
30 Yr TBond Sept CBOT
98~06
-0~08
Dollar Index June NYBOT
108.52
+0.25


NOTE: We are not real strict about allowing this Report to
be published all over the internet, e-mailed to friends,
copied, faxed and passed around. The only thing we ask is
that you do the right thing and give us proper credit --
and that includes the judicious inclusion of our web
address: www.usagold.com

We are no doubt pleased at all the attention this report
receives, but it would be even more pleasing to get as
much benefit from these efforts as your good graces will
allow.

Thank you.

Gold Market Report (7/13/00). . . . .Gold remained remarkably
calm and range bound this morning despite resurgent oil prices and
an inflation rate ascending to the uncomfortable level. August oil
has traversed the $31 mark once again and the PPI jumped .6% for
an annualized rate of 7.2%.

Of course the stock market promoters could be heard cooing softly
about a "core" rate of .1% excluding food and energy, while family
dinner table discussion escalates to high pitch about the rising
cost of living. The only problem with excluding food and energy in
these considerations is that no one in the United States can live
without food and energy, though the PPI apologists would have you
believe that we could.

There's another problem: Most with an ear to the economic ground
already believe that these statistics are manipulated and no
longer reflect reality. It won't be long until that indictment
becomes the generally held perception. Then retirement and pension
beneficiaries (including Social Security), wage earners, etc. tied
to a COLA(Cost of Living Adjustment) will be organizing to obtain
economic justice and the government will have a real problem on
its hands. But in the meantime the Clintonesque charade continues
-- all in the interest of wages and retirement benefits being
restrained from blowing the lid off the inflation rate.

The Keynesian mind-set which still dominates most governments
around the world holds as decalogic the view that the way to
control price inflation is not through monetary restraint (which
only seems logical), but through increasing production. One can
even hear words defending this line of thinking emanate from no
more credible a source than Alan Greenspan himself who up until
taking the job of Fed Chairman tended toward an Ayn
Randian/Libertarian/Austrian view. In those quarters, such
thinking would have been considered heretical, but once infected
with Beltway logic, as Greenspan has been, all in the end are
Keynesians, as a once and future conservative named Richard Nixon
reminded us long ago.

Philosophical considerations aside, in the Keynesians milieu, the
monetary inflation is created first, then the production must come
from wherever you can get it to keep prices down. That's all well
and good until foreign stubbornness in the form of an oil cartel
intrudes to bust up the party. And now we are getting solid signs
that the party is indeed winding down with the morning-after
headache an inevitable and yet to be experienced reality, courtesy
of exporting nations, OPEC at the top of the list.

Today's PPI, if you are now on the same page, was not the most
important number published over the past two days. The truly
important number was the one appearing yesterday under the heading
of Rising Import Prices. That number -- up .8% -- rings over the
mountain tops for one very good reason: It represents the future
for the American consumer. Just as the government economists and
their private sector apologists crowed that deflation or
disinflation was being imported from overseas following the Asian
contagion, so we must face the converse: inflation being imported
from overseas, primarily in the form of the one area of production
the politicians can't seem to control (despite their undying
efforts) -- the oil sector. There hasn't been much crowing about
that, unless you happen to stumble across reports like this one.

To make a long story short, a little gold goes a long way hedging
inflation ills. By the way these same Keynesian principles with
respect to price inflation (outlined above) have been applied
readily to the gold market in recent years. Great pains have been
taken by the bullion bankers to find gold wherever they could to
keep the creation of inflated paper currency from overwhelming the
natural supply of gold from the mines and scrap meltdown, and thus
ceaselessly building a wall to keep that inflation from
threatening their cheap but precarious loan positions. The gold
was sucked out of every central bank from London to Kuala Lampur.

When that started to dry up, these same market managers tried to
squeeze the gold out the International Monetary Fund. Now, with
the U.S. Congress slamming the door to the IMF vaults and the
Washington Agreement dashing any hopes that the European banks
would drop any more gold on the table (from either sales or
leases), these same bullion banks, if reports are to be believed,
are on a campaign to persuade the private sector to lease its gold
-- a state of affairs that must truly mark the end of the trail.
Once they drain the private sector of willing lenders (which I
believe are few and far between), it would seem that another party
will have drawn to a close.

Remember: Currency printing can be covered by production for
awhile, but it cannot be covered forever. There comes a point when
too many dollars are chasing too few ounces of gold, and the
supply dries up. Then the lid blows off the market, as it did in
1971, and gold could be in for a ride that will probably rival the
one during the 1970s. (I note with interest the article which
recently appeared in Forbes magazine blithely predicting a
$2500 gold price.) Only this time we might not be as lucky as we
were back then. In 1979-80 strict monetary measures, under then
Fed Chairman Paul Volcker, were employed to bring the economy from
bursting in a hyper-inflationary blowoff. This time we have a
financial bubble to contend with that dwarfs anything that's
preceded it. That will bear its own wholly unique consequences and
there may not be a Paul Volcker around to manage the turmoil -- at
least not one willing to tie his reputation to the rail in front
of a runaway freight train.

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

An Invitation:

I would like to invite those who take an interest in the type of
analysis read here to give our newsletter a try -- News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals. This month we focus on oil and inflation. Many
analysts and investors think there very well may have been a
fundamental shift in economy that could favor the gold market and
hammer the equities and dollar market. These opinions from various
sources are covered in some detail in the upcoming July issue.
Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The package is
offered at no cost or obligation. You can call Marie at
1-800-869-5115 to request the newsletter and Almanac or
click above.
ORO
From Fleckenstein - on the dangers of truth
http://www.siliconinvestor.com/insight/contrarian/index.gsp?date=2000/07/12"...regarding Salomon Smith Barney's recent downgrade of four semiconductor stocks, which he titled, "Bloodsport." [Note: He doesn't work at Salomon.] It follows:


Subject: Re: SSB semi call
Bill,

You might be interested to learn that they received seven death threats and body guards have been hired. Confirmed factual.

The analysts have been told to take a break from coming into the office.

Investing in the U.S. has become a bit like an international soccer match. Not only are sides taken based on team affiliation (long/short, bull/bear), but players and spectators can be subject to uncivilized behavior, including violence."
--------------------------

The reported corporate earnings are synthetic, a significant part of earnings - about 40% on average for the SP500 is ESOP related tax benefit (Business Week blurb from a few months back). The latest Z1 report from the Fed shows a net flow of funds OUT of the stock market for sophisticated private investors going at a record rate of an annualized $587 billion in Q1. Positive flows coming from naive mutual fund investors and from abroad.

If the bulk of this is from ESOPs and IPO founder's stock, then on, say $500 billion of stock sold, at 35% tax benefit to corporations, the contribution to "after tax earnings" should be on the order of $175 billion, out of a total of $635 billion on table F7 in the latest Z1 report (including non-public corporations, public corporations account for about 75%-80%, leaving under $500 billion in net income of public corporations), of which ESOP tax benefits going straight to the bottom line are then at least 35%, confirming the BW numbers.

Adding wage savings to the tax benefit, the ESOPs can be said to account for ALL corporate earnings of public corporations when summed together. This means that key people in corporation's executive suites, boardrooms and
R&D labs are taking ALL PROFITS of corporations.

The US government gets some 40% of this sum, $200 billion annually.

Would anyone in corporate America and Government want to tell the investors in the US stocks - whether these are small domestic investors or pension funds, but particularly foreign investors - that they own stock in non-profit organizations? That there is no reason at all to own stocks?

Once the Emperor knows he has no clothes, he will make sure that there is enough loud cheering so that it would drown out anyone in the crowd that yells "the Emperor has no clothes". With all the cheerful hubub, few get to the front rows where they can see the Emperor. The few that know what they see will find it their "patriotic" duty to keep mum or join the cheering. Those who dare speak the truth must be drowned out. Those who are so loud that they might be heard must be threatened into silence or beaten.

Is it any wonder that death threats are made when truth is told?

ORO
The Emperor

Could it be that Emperor Willie is just as invisible as his economic clothes?

TheStranger
Inflation Update
Excerpt:
July 14, 2000

More Businesses Are Increasing Prices;
Petroleum Drives Import Costs Higher

By NICHOLAS KULISH
Staff Reporter of THE WALL STREET JOURNAL

WASHINGTON -- A survey of business economists showed that more
companies are raising prices than at any time during the past five years,
while a separate report shows import costs continue to rise on spiking
petroleum prices.

The National Association for Business Economics said one third of the
businesses it surveyed had increased prices in the second quarter and half
expected to do so later this year.

Meanwhile, the Labor Department said import
prices climbed 0.8% in June, compared with a
0.3% increase the previous month. Prices on
petroleum imports jumped 7% last month,
compared with a 4.8% rise in May. Excluding
oil, import prices were flat in June, compared
with a decline of 0.2% in May.

Import prices fell during much of the late
1990s, helping to restrain inflation for both consumers and producers. If
prices on goods produced abroad rise, U.S. residents will lose the cheaper
alternatives that have helped keep rising costs for many products at bay.

Of the 127 economists surveyed by the NABE, 33% said their companies
increased prices last quarter compared with 29% during the first quarter
and just 20% for the fourth quarter of 1999. The NABE attributes higher
prices primarily to rising wages and materials costs. Just 5% of businesses
reported falling input prices, compared with 60% that saw them increasing,
the group said.

"You've got an environment ripe for inflation; however, that acceleration
is very likely to be gradual," said NABE President Diane Swonk, the chief
economist at Bank One Corp. in Chicago. "For years, these firms were
saying, 'Well, we don't have any pricing power.' That's changed."

Federal Reserve Board members have cautioned that the economy still
shows signs of inflationary pressure, though they chose not to raise interest
rates at their June meeting. Markets and economists have been watching
economic indicators closely, searching for signs of the so-called soft
landing, a slowdown to a more-sustainable growth level.

"Whenever you hit a turning point, you get crosscurrents. The trends that
are emerging are not alarming, but they certainly do raise a yellow flag,"
Ms. Swonk said. The NABE survey reported that 52% of respondents
saw demand rise in the second quarter, compared with 48% in the first,
suggesting continued rapid growth in the U.S. economy. "It's not as
optimistic about a soft-landing scenario," she said.

Today's report on the June producer price index could allay or heighten
fears. Economists surveyed by Dow Jones Newswires and CNBC expect
a 0.6% rise in the overall June PPI and a moderate increase of 0.1% in the
core rate, which excludes food and energy prices. Higher readings could
raise concerns of further interest-rate increases when the Fed
Open-Market Committee meets Aug. 22.

"Those that are hoping for an end to Fed tightening may be premature,"
Ms. Swonk said.
*****
Stranger's Note: Of course, by now we know the PPI did come in, as expected, at +.6%. Is it not amazing how dismissive the street is of anything that purports of inflation? Before long, they won't be.

This article carries the clues to where we are headed. Rates have not peaked. But, due to the danger presented by a hard landing, the Fed may be taking a breather, hoping banks will clean up their lending habits before the time runs out on them. (Did you hear Greenspan's warnings to them the other day? He said they better not be counting on any bailouts this time!) Meanwhile, let's stay tuned. There is more inflation dead ahead!

To stay ahead of all the business news, subscribe to the Wall Street Journal.
Gandalf the White
SteveH and J-Dude's prior comments on the "Picture"
http://moneycentral.msn.com/articles/invest/careful/5587.asp?special=msnMSN's Picture on the line "How would you invest $1 million?" shows a person carefully stacking gold coins !!! -- AND, then of course the lengthy discourse says NUTTIN about gold, but, derivitives !! -- When the Hobbits saw the PICTURE, there were smiles, BUT, when they went to the LINK -- <;-(
Perhaps someone should advise the author, Mary Rowland, of bait and switch regulations.
<;-)

HI - HAT
BAD VIBRATIONS
One does nat have to be a card carrying Bible-Thumper to relate to these times as being WICKED.....

Breakdown of society........With the selective RULE of Law is WICKEDNESS.

Arrogance and Hubris are at levels not to be believed. What could be the outcome to blind agradizement.?

There is an old Italian expression: After the fooling ;Comes the crying.

I've no doubt Ravi Batra is correct in his analysus. What I do have a problem with is his, what seems to be positive looking aftermath to the ensuing calamity.

It's Cronyism and Thuggery at the highest levels of different facets of social-political-economic milieu.

I say Batra is naive, because who pray tell will take the power-yielding thugs to task?...NOBODY....

We will be living in a NIGHTMARE.
CoBra(too)
Doomed Boomers? Or boomers dooming Goldilocks?
I'm kind'a stunned the last several posts - beginning with MK's splendid comments, followed up by Oro's naked "Bill" and Stranger's inflation follow up in the wake of an "officially" tame, no even falling, PPI core rate in the wake of a (even volatile food and energy) compounded .6% rise = 7,2 annualized inflation rate - hit the nail on the head.

No, there's no inflation - wev'e bought all the SUV's we can afford in view of the pump prices. We spent all we could ever afford into our pension funds - we've had it - we retirin baby boomers may want to have some security left in our old age. We're not complaining yet, though we start to have second thoughts about the wisdom to have all of our nest-egg in private pension funds- and some financed by hocking the rest of our net worth to Fannies and Ginnies.
Give us a break - we've been running with the herd too long, financing the world by spending, consuming and accumulating - ever appreciating equity for retirement, just as we've been told.
We don't want to wake up - finding the values, the beliefs and the rest of our lives have been lived on assumptions of everlasting paradigms of the "new economy", an assumption, already questioned, may be totally discredited by any truth loving successor of this corrupt administration. May the "Secret" of the negative shift in Private Pension Funds waake you up in time!

.... And please forgive me to hold the mirror to my friends in the USA. - An excercise I should take to heart.

Sorry for ranting - best CB2 ... and forgive me for again not editing!
CoBra(too)
RE MSG. 33453 - Black Blade
BB- many thanks for your reply, which had me rethinking. Will let you know of any response from "officials" - in the meantime it seems a new mega bank is forming in Europe. After Deutsche Bank blundered in the takeover of Dresdner- it now seems Dresdner and Commerzbank are wanting to join forces and - may become EU's # 1!

Best CB2
White Hills
Wisdom from the past
Going through my old books in the garage I found this book from my gold prospecting days, The Gold Divers handbook by Matt Thornton (1975), and thought the forum would be interested in what Matt had to say at the time about gold. Matt wrote "In the past few years, there has been much talk concerning the demonitization of gold. Technically, this Nation has been off the gold stadard since the year 1934, and no one can deny that our economy has been "going to the dogs" ever since. But now there is a ray of hope. On August 14, 1974, U.S. President Gerald R. Ford sighned a Bill permitting American citizens to legally own gold bullion for the first time since 1934. This Bill went into effect at one minute after twelve midnight on December 31, 1974, and while it does not reaffirm gold as the basis of our monetary system, it does give Americans the chance to protect themselves against fluctuations in the value of the dollar" He goes on " Lord only knows how long we, the American people, will be permitted unlimited ownership of the "stuff that dreams are made of." But whatever role the politicians choose for gold in the future, the person who prospects, dredges, snipes, pans, runs a metal detector, ect. has no worries whatsoever, because gold will always remain a cherished and valuable substance in all parts of the world. You simply can't change thousands of years of tradition by the mere stroke of a pen across a piece of paper~ the people of the world will not stand for it." I wish that I had paid more attention to this the first time I read it. White Hills
JavaMan
GW,

My thoughts exactly. I suspect the pupils of my eyes doubled in size when I saw the picture only to return to normal after reading the story.
Journeyman
Re: Emperor's fine duds

ORO (07/14/00; 10:16:05MT - usagold.com msg#: 33465)

VERY well said indeed, SIR ORO!!

High regards,
Journeyman
Peter Asher
Gandalf and Javaman
Yes, but the intesting thing is that in choosing a symbol to illustrate HAVING WEALTH, they selected a photo of Gold Coins!
Buena Fe
Gold At $2,500?
http://www.forbes.com/forbesglobal/00/0724/0314048a.htm"Even as Alan Greenspan frets about inflation, most investors have given up on hard assets. Leigh Goehring keeps the faith."

Hey friends I thought you might enjoy this successful money managers perspective!
Turnaround
oil rumor
http://www.irna.com/newshtm/eng/24152820.htmthr 007
Opec-Meeting
Opec Secretariate has no idea of an extraordinary meeting
Vienna, July 14, IRNA -- The Spokesman of the Secretariate of OPEC
says he has no information about an extraordinary ministrial meeting
of the organization in the near future.
Farough Mohammed on Friday said that there were only some rumours
in this regard. He was reacting to reports quoting official sources in
Kuwait, saying Rilwanu Lukman, OPEC's Secretary General has invited
the Kuwaity oil Minister to participate in an extraordinary meeting
here next Tuesday.
Ali Rodriguez-Araque, President of OPEC Conference and Oil
Minister of Venezuela, who is visiting Qatar, also did not confirm
there was any OPEC meeting in the near future. The Oil Minister of
Qatar said he also did not know anything about it.
Buena Fe
The Patriot & the rules of war!
My facts on this story may not be 100% accurate, but you'll get the point:
Montana Resources is a private Co. mining low-grade copper in Butte, Montana. (right next to the old Butte Mine) Their electic utility contract came due this July, which historically has been a great time of year to renegotiate these kind of things because of slacker demand and lower prices, yet the best deal that they could come up with was 100% higher per unit then the old contract and then only good for one year! (so much for deregulation!) Well apparently this was a complete shock to management and it evaporated any profits from the operation so they shut down the mine and layed off approx. 300 people! (please correct me if I have the story wrong)

So much for no inflation and the almighty "CORE RATE OF PPI/CPI etc etc........!!!!!!!!!!!(take out food and energy, my God man, we may as well live on the moon) Its time folks to raise the Militia.......our opponents have been violating the rules of war and killing the innocent...........time to ambush the officers........aka "The Patriot"
TheStranger
A Great Big Thanks To Buena Fe....
http://www.forbes.com/forbesglobal/00/0724/0314048a.htm....for that Forbes link. I have already emailed it off to numerous friends. I hope many others will do the same.
TheStranger
Buena Fe Again
B.F.- You are soooooo right, golden breath. All day today, CNBC reported that the market was solid because of the GOOD inflation news. One anchor even said, "the PPI was up .6%, but OVERALL inflation was actually down." WHAT?!!!

Meanwhile, retail sales were up .5%. So much for the slowing economy theory.

And so it goes...

White Hills
Gold Report Msg#33464
Great report! This is one of the reasons I am at this Forum everyday. But, about the "Clintonesque charade". Everything you say about what is going on in the Clinton Administration is true but why don't we hear the Republicans raising their voices in opposition? Why aren't they warning and informing the American people what is going on? It seems to me that the republicans and the democrats are aboard the the same ship "Economic Titanic" and their only disagreement is who should be Captain.
SHIFTY
Morgan Stanley Dean Witter
I received my statement today, and could not believe my eyes! With my statement was another copy of

" Perspectives" " A monthly report EXCLUSIVELY for Morgan Stanley Dean Witter Clients!

This one takes the cake!

They say..... " Our Current Recommended Asset Allocation"

International Stocks 15%
Domestic Stocks 65%

Total Stocks 80 %
Bonds 20%

CASH !!! 0%

I have heard for years that we were heading for a cash-less society!

I guess the cannibals at Morgan Stanley Dean Witter are on the cutting edge ! !

Goldfly
Stranger, Buena Fe
I absolutely LOVE that last line:

"....100% of my personal portfolio is in commodity-related investments," he says, pulling out a recent bill for the storage of his personal gold and silver bullion holdings.

Gold and SILVER.... My kinda guy.

gf
SHIFTY
Shifty's Asset Allocation
Shifty's Asset Allocation

.999 Gold 45%

Un-hedged Gold mining Stocks 45%

Cash 10%

White Hills
Gold Mining & Gold
Las Vegas Review Journal, July 14, 00. Article by Andrew Huff, attorny with the Indian Law Resource Center, entitled "Gold Mining poisons the land" Knight Ridder/Tribune News Service. Mr. Huff makes his case in the article about the damage mining is doing to the environment. I don't argue with him on that score although I suspect he is using the most outrageous examples of Bad mining to make his point. I what I do object to is the part where and I quote "It is time the gold mining corporations gave our mountains a rest. There is no overwhelming societal need for gold. Eighty~five percent of gold mined currently is used for jewelry. Gold no longer backs currencies. National gold reserves, which many countries are now selling off, could long supply industrial needs". It seems that I have heard that same story before from people that wish it were true but know that it isn't. If gold has no societal need then why do people try and get as much as they can and to hold it as insurance against just what is happening in this country today. White Hills
Al Fulchino
Stranger
Looks like a buying opportunity in Newmont to me. What are your thoughts on its slide below 20, considering POG has remained buoyant at 280? Any thoughts?
Chris Powell
Newmont fell, Battle Moutain rose today
Looks like something funny happened
today with Battle Mountain Gold (BMG),
one of my old favorites. Volume
exploded at the end of the day and the
price rose as if it was actually
buying. Meanwhile Newmont, BMG's buyer,
fell notably. Some of us had to wonder
if this foreshadowed an alternate
bidder for BMG, since the breakup fee
on the NEM/BMG deal is said to be only
$13 million.
ET
ORO, Buena Fe & da Stranger
Hey fellows - hope this finds all of you well.

ORO - I wanted to tell you I've been saving many of your posts and decided to print a dozen or so of them and take them to our weekly bridge night (several couples). What a hit they were! It's amazing to see the look on people's faces when the light goes on. We all agreed a book would be well-received but finding a publisher in today's environment might be difficult. Thanks for all the work you put into this.

Buena Fe - if I understand the electricity situation correctly, many parts of the country have not been able to keep up with electricity demand because of over-regulation. New production facilities need to be built to meet demand and it simply hasn't happened forcing electricity providers to purchase available power on the open market. This has created 'shortages' at times, running prices up by several magnitudes in some cases. Our local firm here in Kansas was caught out last summer and nearly went bankrupt trying to provide power. The same problem is affecting the natural gas industry.

Stranger - you're a wealthy guy my friend. If I might contribute a data point or two to the discussion; my industry, heavy duty truck parts, has recently become very slow. Our business is falling behind sales last year despite some minor price inflation. Another interesting thing concerns late model used trucks. Several heavy truck manufacturers are sitting on large and growing inventories of 3 to 5 year old vehicles in which they paid a 'guaranteed' buyback price upon the trade. Reports have it they are underwater by 10K to 20K per vehicle on these deals. Further word has it that many of the major general freight haulers have cancelled orders for new vehicles. It seems there is a lack of stuff to haul. If freight is any indication, the overall real economy is slowing down rapidly.
Journeyman
Re: There is no overwhelming societal need for gold.

"There is no overwhelming societal need for gold." -Attorney Andrew Huff quoted in White Hills (07/14/00; 19:37:02MT - usagold.com msg#: 33485)

Luckily for Attorney Huff, "societal need," like beauty, is in the eye of the beholder. It's lucky for him because I know a few folks who believe there is no "societal need," overwhelming or otherwise, for attorneys. And, while we're at it, is there really an "overwhelming societal need" for politicians and bureaucrats? I'd suggest that neither politicians nor gold are going away any time soon.

Regards,
Journeyman
Black Blade
@Buena Fe and MT Resources
You're right about the story. I toured the mine in 1995. I believe that the mine is majority owned by the billionaire Denny Washington, The current energy costs would result in a loss of over $3 million/month. It's a shame. Good thing that there is no inflation overall, right?
Black Blade
@White Hills msg. 33481
I suspect that the reason that the Republicans aren't screaming about inflation numbers and bogus PPI, CPI numbers is quite simple. The bogus reporting standards for the PPI and CPI occurred under the watch of George Bush, George W's daddy. In other words, they don't want to have to do a lot of explaining.
Black Blade
@Journeyman msg. 33489
That's a good one! You took the words right out of my mouth. Now just think of some of the various tribes that get royalties from natural resource extraction. There are some reservations where you can see extreme poverty, with whole families living in broken down autos. The employment situation is bleak, and many people in some of these places would surely wish that they could earn a living in natural resource exploitation. Even (gulp!) gold mining. Many of my Shoshone, Paiute, and Bannock friends work in the gold mining industry and have no problem with it. In fact they are doing quite well, as are some of my Chyenne and Soiux friends in the Petroleum industry. I wonder who this weasel (lawyer) really represents.
Bonedaddy
Who will save us from inflation?
Will it be the Wizard of FED? Inflation was pretty much unheard of before the creation of the Federal Reserve System. (Did Dr. Frankenstien ever regain control of his monster?) A currency based on debasement is just a pretty tough thing to manage isn't it. It's kind of like finding a person who is willing to be just a little bit crooked. The day the Federal Reserve was born, inflation was guaranteed.
And on that same day, the Republic slid a long way toward becoming a democracy.
Recall the warning of British professor Alexander Frasier Tyler who said: " A democracy cannot exist as a permanent form of government. It can exist only until the voters discover that they can vote themselves largess out of the public treasury. From that moment on the majority always votes for the candidate promising the most benefits from the public treasury - with the result that democracy always collapses over a loose fiscal policy, always to be followed by a dictatorship."
A DEMOCRACY IS THE ANTITHESIS OF A REPUBLIC! In a republic, sovereign individuals elect representatives and solemnly charge them to act, in accordance with constitutional law, to insure the blessings of liberty, justice, private property, and the persuit of happiness to the individual citizens of that republic. A REPUBLIC REQUIRES RESPONSIBILITY AT THE LEVEL OF THE INDIVIDUAL. AND BY ACCEPTING THE RESPONSIBILITY, THE INDIVIDUAL GAINS THE RIGHT TO SOVEREIGNTY. A democracy is quite simply rule by the mob. The mob has no eyes to see, or hands to create, or any feelings of responsibility to a higher power. The mob wants what it wants, and it wants it now. To hell with my neighbor, I'm getting my fair share first.
The economy of this once great republic has been beaten and gang raped by the Federal Reserve for so long most of the subjects are exhibiting classic signs of the Stockholm Syndrome. Oh Please, Mr. Greenspan, save us from the evil inflation monster! Greenspan replies: "O.K., I'll do my very best but I'm afraid it's going to have to hurt you some. We're all going to have to pull together now and tighten our chains, er, I mean belts."
I certainly hope that everyone reading this understands that the only cure for inflation is honesty and responsibility. And that these devine traits are only bestowed by our Creator on individuals. And that the only hope of this Republic is for each of us individually, to esteem ones neighbor higher than ones self. By doing this we all benefit from the blessings of liberty and true prosperity. If we operate any other way, chaos rules the day.
An ounce of GOLD is an ounce of GOLD is an ounce of GOLD.
elevator guy
Is there any body out there? My message in an internet bottle.
Is there anyone besides me who beleives TPTB will keep squashing paper gold as long as possible, perhaps indefinitely?

It may have occured to someone watching this scenario, that not even something like the Washington Agreement can make any difference in the gold market. Gold didnt stay at $330 in the fall last year, and it didn't continue up to $30,000/oz, nor even $600,but it DID get sold down to a safe and comfortable $280/oz, which is about where it sits now, give or take a few.

And watching this is about as exciting as watching grass grow.

So it may have occured to someone else out there that the only way to change this situation is to have an economic revolution, where the FRN is replaced by US issued currency, whose value is tied to gold in some realistic way.

Short of a revolution, TPTB will keep on trucking with their funnin. So it may have occured to someone else, (Certainly not me, for I am a true and stalwart gold bug, who waits for the imminent fall of the sky), it may have crossed someones mind in a moment of moral weakness and rebellion, just for a tiny second, that we are not changing the general public's perception of the worth of gold, here at this last tiny outpost of truth, in a vast wasteland of media spin, where the wind of deception blows through the walls of our abode like a dagger of untruth stabbing at the very heart of truth on Earth, the heart of gold. we hudle in small circles, warming ourselves by the fireside of conversation, waiting for the sky to fall and we all become millionaries. (the gold boys)

And as we wait, nothing seems to rock the foundations of the Western world, which is built upon the lie of non-redeemable fiat currency. Where was I? Oh yes! It may have occured to someone looking at all this, that the only play for leverage in this paper game, is to ride the tide of public opinion, go surfing as it were, as gold climbs promisingly to $290, then sells back down to $275. This is all the wave that one can catch here at this beach. Thats it! Just boogy board on out there at $290, and ride down to $275. Its not much of a wave, but it keeps going like this, and its good fun all day.

Has this thought ever occured to anyone else here?

Of course, those who have heard me talk of gold know I am not so shallow as to sell out to the lure of cheap quickly gotten gains, (woooo-eee), at the expense of the naive. My personal character stands unchanged.

But what do you do when there are no big waves breaking?
TheStranger
Al, ET
Al - What with gas stations and art galleries, you are obviously a real entrepreneur (just like M.K., by the way).
I have never had that kind of courage, myself, but I really respect it in you.

I have so many shares of Newmont now that I ought to be having trouble sleeping. Yes, I believe it will quintuple in the next year, and it should be bought. Two provisos, however: first - I have been waiting for two years in this stock and am actually underwater in it now, though not by a lot... second - a careful study of the charts will convince you that owning gold and owning gold mining stocks can be two very different things. Gold can easily do reasonably well while the stocks just go to h---. It happens all the time. But clearly, if mutual funds and/or institutions develop any interest at all in gold, Newmont is the first thing they will buy. It is one of the very few gold mining stocks that has any liquidity to speak of. If I am wrong, I am really going to wish I had bought coins instead.

ET - You mentioned this slowing once before a while back. I suspect you are in a position to see it earlier than most, so I will take heed. Cavan Man is in the cardboard box business so he probably would have something to say on the subject as well (IF HE WOULD QUIT FADING OUT ON US AND GET BACK IN HERE AND POST, THAT IS).

You may certainly be seeing a part of something significant. I don't know. But my view is that not enough has been done by the Fed to reverse the inflation problem, much less bring on a recession. If more isn't done soon, in fact, you may find that the recent softness in your business was only temporary. One thing is for sure, however, the developing inflation problem is for real, and reversing it is going to take more than the soft landing scenario so many are predicting. If easy credit conditions persist, prices will spiral upwards. If easy credit conditions do not persist, and eventually they won't, then stocks may tank. Either contingency will be a tough pill for the dollar to swallow.
SHIFTY
The Stranger
underwaterYour not alone I have been blowing a few bubbles myself lately!
SHIFTY
Mining Ban Recommended in Ariz.
http://dailynews.yahoo.com/h/ap/20000714/us/mining_ban_1.htmlPHOENIX (AP) - The U.S. Forest Service is recommending a ban on new mining in the San Francisco Peaks, a dormant northern Arizona volcano held sacred by 13 American Indian tribes......

$hifty

View Yesterday's Discussion.

Bonedaddy
Hey, elevator guy
You can really turn a phrase: "where the wind of deception blows through the walls of our abode like a dagger of untruth stabbing at the very heart of truth on Earth" I loved that!
And yeah, deception has a way of doing that. But deception has been part of the game since the garden. The truth is always found on the narrow path. Single file.
I don't know when GOLD will again be held in high esteem by large numbers of people. I don't know if it really matters. What I do know is that the "other system" is based on the lie of fractional reserve banking and it is destined to fail at some point. Gold on the other hand is a defensive weapon. It can't offensively steal from people the way fiat money can and does. The current dollar price simply means that GOLD can be bought very cheaply now, as compared with the price of something like a new pickup truck. For the price of GOLD to skyrocket, the US economy would have to take a very big hit. This will inflict a huge amount of pain on us all. Civil unrest will surely result in some areas. I'm not anxious to see the price of GOLD surge, it will happen sooner than most of us are ready for. No one who carries a weapon for self defense should look forward to the day that they will have to use that tool. The only thing worse that having to use deadly force for self defense, is being unprepared to do so when the situation requires it. For now, we have the good life and many things to be thankful for. Let us live in peace and happiness and continue to accumulate small amounts over time. All that you already know in your heart about this is true. The time will come.
My best to you friend - Bd
Black Blade
A little light weekend reading assignment: Gordon Gekko revisited
http://www.buyandhold.com/bh/en/education/boesky.htmlIvan Boesky
By Brian Trumbore
President/Editor, StocksandNews.com
I started my Wall Street career in November of 1982, which, since the Bull Market began in August of that year, makes me a Bull Market baby. Oh, to think that the market was around 770 that summer. Also in 1982, an arbitrageur by the name of Ivan Boesky decided that he didn't exactly always have the magic touch in selecting deals to invest in so he switched tactics, thus earning his place in the annals of Wall Street History.
Boesky was the son of a Detroit bar owner who had come to the Street in 1975. Setting up shop in relative obscurity and having attended a law school no one on the Street had ever heard of, Boesky used his family's money to enter the arbitrage business. He quickly built a reputation for himself as a shrewd operator.
Boesky used to bet on takeover situations, mostly after a deal had been announced, thereby assuring the arb of a profit if the deal went through at the announced price. For example, Co. X announces a takeover of Co. Y at $70 a share. Co. Y stock, which had been $40 before the announcement, climbs to $65. An arb may step in at that point (or as it is climbing to that level) and place a heavy bet that the deal gets done at the announced $70 a share, thereby assuring him a $5 profit. Now if you leverage that bet, the percentage gain could be much greater than the simple $5 and sometimes a competing offer would enter the picture at, let's say, $75 or higher. All the better for the arb.
But there were other times when the announced deal would fall through. In these cases the arb could get squeezed. This was the case in May of 1982 when Gulf Oil's announced takeover attempt of Cities Service failed. Boesky lost $24 million on this deal. And it was this loss that apparently led Ivan to build a secret network of investment bankers and brokers, simply to improve his odds. This network would then supply Boesky with insider information. Two of the key figures were Martin Siegel of Kidder Peabody and Dennis Levine of Drexel, Burnham, Lambert - both old and respected firms.
Using inside information supplied by Siegel, Boesky made $28 million from Nestle's acquisition of Carnation in 1984. They were heady times for many on Wall Street. It was the time of "Master's of the Universe," and much cruder labels. The big money guys on the Street worked hard. "Lunch is for wimps," said Gordon Gekko in the movie "Wall Street," a great depiction of that era. Boesky was one who worked 21-hour days. Hard work, a product of the trader culture, came to replace play as the motif of the super-rich.
It was also the time when the LBO, or leveraged buyout, took off. LBO's were ways to make money by taking public companies private. Companies would float bonds to buy up a controlling interest in the stock and then use the company's cash flow to finance the debt. The secret was forecasting out the company's cash flow, the measure of how much debt it could support.
Dennis Levine of Drexel and Boesky became fast friends by 1986. Boesky had opened an investment fund called the Hudson Fund. Drexel agreed to raise over $600 million for him through a junk offering provided that it was paid almost $24 million fees. And later, even the notorious Charles Keating of Lincoln S&L fame contributed $100 million to Boesky's arbitrage partnership.
Boesky began to work some deals but he was building an empire built on tips more than doing his homework. And he invested a portion of his gains in ways that only enhanced his reputation. For example, Boesky owned the Beverly Hills Hotel in L.A., site of Michael Milken's Predator's Ball which spoke of the virtues of junk bonds as dozens of politicians and academics feasted on sumptuous dinners amid a bevy of Trump-like arm candy. (Even Bill Bradley found himself delivering a speech to Milken's audience.)
But during the course of 1986, the Fed's were growing increasingly leery of the trading activity in some of the deals that Boesky was investing in. He was soon indicted on a variety of charges in an insider-trading scandal that was to stain the industry for the rest of the decade.
The most notorious of the Boesky allegations involved an engineering company, Fischbach, that had been subject to a hostile raid by a Drexel client. As described in Charles Morris' book, "Money, Greed, and Risk," the deal went down like this:
"(Fischbach) bought back the raider's stock, and negotiated a standstill agreement, barring another takeover attempt unless some new raider acquired a 10% stock position in the company. Boesky later acquired a 10% position in Fischbach, allegedly at the behest of Michael Milken, and made a takeover declaration, opening the door to an eventual takeover by another Milken client. Milken allegedly guaranteed Boesky against any losses, which would have been illegal. Milken said he never made any such guarantees, that he merely advised Boesky that Fischbach was a great opportunity, but that he never made guarantees. Boesky's testimony went like this."
Q: O.K. And did Milken say to you in that conversation that he would guarantee you against loss?
A: These were not the words, never were the words.
Q: It's the code you were talking about, the Wall Street code?
A: I never used that word either. It was an understanding.
Q: O.K. What were the words you remember Milken using?
A: "Just buy it, don't worry about it," something to that effect�I've forgotten the exact language of the conversation.
Officials at Fischbach ended up being indicted for bid rigging. A deal eventually went through but not at the level that Boesky had even paid. Allegedly, Boesky had bought the stock at $50 with the final sale being at $45 compared with current market value of $40.
Boesky admitted to numerous offenses and then turned state's evidence, primarily against Milken. He received a 3 1/2 year prison sentence and $100 million fine after admitting to the charges and reached a plea bargain with Rudy Giuliani, U.S. attorney for the Southern District of N.Y. Giuliani was to draw criticism because Ivan was allowed to unload his holdings before his indictment was officially announced, realizing profits from it before being convicted. Others considered the sentence and fine as being too light. But Giuliani and company was after a much bigger fish, namely Milken.
As Boesky left federal court in 1987, he proclaimed, "Greed is all right�everybody should be a little greedy." The man who once paid for secret information with a suitcase full of cash was off to the slammer.

Black Blade: See anything familiar in todays Wall Street culture? See ya all later. Gone fishing! Supposedly "Golden" trout in one of the high elevation lakes.

canamami
Stranger...
I found some time to do some catching up at the Forum. I checked out your website, and it's obvious that your wisdom in economic and market matters extends to the personal, to have created what is clearly a wonderful and happy family. Felicitations, mon ami.
TheStranger
Canamami, ET
Thanks, Canamami. I know you are busy, Your Honor, but I sure wish you would post more often.

ET - This was in Barron's this morning:

"In May, new orders for big rigs were down more than 50% year-over-year to
10,500, the lowest monthly level since 1996. A combination of overbuilding in
recent years, higher fuel costs and economic concerns are taking their toll.
North American production is expected to fall to 240,000 trucks from the
record 334,000 in 1999 and drop further in 2001."
JavaMan
Sir Bonedaddy , your msg#: 33493 - Who will save us from inflation?

Great post. You said...
"I certainly hope that everyone reading this understands that the only cure for inflation is honesty and responsibility. And that these devine traits are only bestowed by our Creator on individuals. And that the only hope of this Republic is for each of us individually, to esteem ones neighbor higher than ones self."

We're in trouble now...
ET
ORO - Corporate profits
http://216.46.231.211/international.htm
Here is a bit more on the current accounting standards. From the article;




"The last time market commentators had such a fertile source
of sordid corporate practices was during the Bre-X gold
scandal - perhaps the biggest mineral stock fraud of all time.
Once the company's drill data and pie in the sky reserve
promises were proven to be completely fraudulent, journalists
feasted on the story for weeks. But it also marked the point at
which the bull market in junior gold shares ended once and
for all. Since Bre-X, the capital market for such companies
has dried up, and literally dozens of Canadian and Australian
exploration companies went out of business. In this instance,
however, we are not dealing with one Bre-X, but a pattern of
questionable and, in some cases, fraudulent conduct, which
appears to be endemic. But, as we have seen with Russia, if the
ethical basis of free markets degenerates sufficiently, all that
we have left is a form of kleptocracy. A pattern of such ethical
disintegration, as evidenced by the Canadian stock
manipulation scandal, or the widespread abuse of accounting
principles, usually emerges at the peak of manias where greed
predominates and fraud becomes pervasive. Just from the
numerous examples out there in the public domain today, we
appear to be at that juncture today. And the outcome may
prove to be just as grave, but far more widespread, as was the
case for Canadian resource companies in the aftermath of
Bre-X."

totalamateur
Preparation for the Big One!
I am the head of the sovereign, relatively small state of Aurora, a non euro zone country that wants to be wise and on the right side of these things when the dollar gives up the ghost, the Euro rises and gold reigns king in economics again, what should I do today to play my hand right? What advice should be given me?

Should I start buying gold quietly, while moving out of dollars and dollar based paper?

Should I run up as big a debt as possible in dollars waiting for the dollar to collapse?

If I have pegged my currency to the dollar should I peg it to the Euro instead?

What would happen to the price of gold if I suddenly declared:

"Hear ye, hear ye, as of today we, the country of Aurora, are on the gold standard! Our monetary unit, the "Money" is from today qual to 1/X ounze of pure gold."

What would be the effect of this announcement on the price of gold and on the international community in general?

What FOA states is that the Euro being "backed" by gold as a reserve asset is stronger than a mere fixing of the currency to gold is gradually sinking in with me, even though I cannot fully grasp that anything could be better than a currency either being gold or next best directly convertible to gold which truly is the only real thing! Even Euro notes as good as they may be or rather become, are still only paper with ink stains on them, aren't they? I thought gold was gold and that's it and nothing could possibly be better! Paper can always be monkeyed with, as we have more than enough proof of, but gold is near impossible to tamper with, although even the Deutsche Bank, I am pretty sure it was, once bought lead painted with nice yellow paint! Is one problem that gold (and silver which would do nicely for the smaller denominations) coins are thought of as impractical? And is another consideration that there seemingly is not enough gold to go around for everyone to have a few in their pocket? I think if we got the gold out of the vaults and into circulation, there would be plenty for everybody. What did Gandhi say: "The World had enough for every man's need, but not enough for every man's greed!" Well, this is another subject; men in this day and age do not share voluntarily, sad to say. They will soon have to, but they will have lost the blessing and reward for doing it while it was still optional. But back to the subject: What is the problem with the old gold standard? It worked before, could it not work again?

I humbly await the thoughts of the forum on these issues and make a solemn promise that we will take no such drastic actions until all forum readers have had time to adjust their portfolios! Thank you for your valuable input! The best suggestions and answers will be rewarded with political asylum in Aurora for as long as you wish to abide with it's gentle, truth-seeking and peace-loving people!
totalamateur
Preparation for the Big One!
I am the head of the sovereign, relatively small state of Aurora, a non euro zone country that wants to be wise and on the right side of these things when the dollar gives up the ghost, the Euro rises and gold reigns king in economics again, what should I do today to play my hand right? What advice should be given me?

Should I start buying gold quietly, while moving out of dollars and dollar based paper?

Should I run up as big a debt as possible in dollars waiting for the dollar to collapse?

If I have pegged my currency to the dollar should I peg it to the Euro instead?

What would happen to the price of gold if I suddenly declared:

"Hear ye, hear ye, as of today we, the country of Aurora, are on the gold standard! Our monetary unit, the "Money" is from today qual to 1/X ounze of pure gold."

What would be the effect of this announcement on the price of gold and on the international community in general?

What FOA states is that the Euro being "backed" by gold as a reserve asset is stronger than a mere fixing of the currency to gold is gradually sinking in with me, even though I cannot fully grasp that anything could be better than a currency either being gold or next best directly convertible to gold which truly is the only real thing! Even Euro notes as good as they may be or rather become, are still only paper with ink stains on them, aren't they? I thought gold was gold and that's it and nothing could possibly be better! Paper can always be monkeyed with, as we have more than enough proof of, but gold is near impossible to tamper with, although even the Deutsche Bank, I am pretty sure it was, once bought lead painted with nice yellow paint! Is one problem that gold (and silver which would do nicely for the smaller denominations) coins are thought of as impractical? And is another consideration that there seemingly is not enough gold to go around for everyone to have a few in their pocket? I think if we got the gold out of the vaults and into circulation, there would be plenty for everybody. What did Gandhi say: "The World had enough for every man's need, but not enough for every man's greed!" Well, this is another subject; men in this day and age do not share voluntarily, sad to say. They will soon have to, but they will have lost the blessing and reward for doing it while it was still optional. But back to the subject: What is the problem with the old gold standard? It worked before, could it not work again?

I humbly await the thoughts of the forum on these issues and make a solemn promise that we will take no such drastic actions until all forum readers have had time to adjust their portfolios! Thank you for your valuable input! The best suggestions and answers will be rewarded with political asylum in Aurora for as long as you wish to abide with it's gentle, truth-seeking and peace-loving people!
ET
Greenspan
http://216.46.231.211/credit.htm
From the article;

"Increasingly, it is apparent that Greenspan has both
lost touch and drifted away from serious economic
analysis. And the greater his detachment, the more he
seems impelled to adopt "New Era" doctrine. After
all, only within his nebulous "New Era," can he
rationalize the highest prices and most speculative
stock market in history, a virtually nationwide real
estate bubble, $400 billion current account deficits,
soaring consumer and business debt levels, and a
reckless financial sector that has been expanding its
borrowings by more than $1 trillion annually, while
accumulating upwards of $100 trillion of derivative
positions. Of late sounding the true "New
Paradigmer," Greenspan is digging in his heels and now
espouses the infamous notion "this time it's
different." Not only has he developed into an
enthusiast of the New Economy, he, amazingly,
champions "New Era Finance" as well. Such leaps of
faith are grossly inappropriate for a central banker,
let alone the Chairman of the US Federal Reserve."
ET
Stranger

Hey Stranger - thanks for the info. Actually I believe the real economy has been slowing for a year or better but has been masked by massive money creation in the financial sector. Now we have higher energy prices, a stock market which has taken a good-sized hit, and noticeable price increases in a number of areas aside from equities and real estate. Please take a look at the two articles I reference below. It would seem fraud in corporate earnings and a 'head-in-the-sand' monetary approach might be with us for the time being. Your inflation scenario just keeps building steam as the money creating financial side of the world economy is becoming further and further detached from the real economy of goods and services. I still suspect we will see the stagflation scenario start to manifest itself as money creation attempts to outpace a slowing to declining real economy.
Cavan Man
the "Stranger" (no longer)
Es el Senor!

Took a long road trip last week. I traveled from St Louis to Denver, Northern Colorado (frontal range), Dallas, Chicago, and New York. What did I see? I saw a large piece of American real estate and everywhere I looked it was "Boomtown USA". Why are we so quick to disbelieve the official inflation data stream and believe that the economy is really coming in for a soft landing?

I work in the corrugated (cardboard) industry. Take note; almost everything you touch each day comes in contact with paperboard or corrugated container board at some point. Life as we know it is impossible with this most mundane and price competitive of materials. The company I work for is quite large. All our plants are virtually sold out. Our customers are all extremely busy even thought Q3 is generally a little soft in good times and bad. Our competitors are very busy. Times are good and look to get better.

The industry typically lags a slowdown or pickup in the general economy by about six months. I'll keep you posted. Personally, barring some unforseen (all are) economic calamity, I think a period of stagflation is a good possibility. Did you see the GS overall commodity index percentage increase YTD and how about the breakdown of the CRB? No inflation? Give me a break. I may be a dumb box salesman but I'm not stupid.

One more thing before I forget; I had the good fortune of bumping into the owner of one of the largest PM coin dealers in the US last week--shared a couple of glasses of fine Port with him and suffered through all the second hand smoke. It seems this dealer has recently sold proof sets for melt value to jewelry fabricators and paid 2.5% premiums from a dealer for Gold Eagles (the mint charges 3%). This chap said the business is the worst he's seen in twenty years.

That's a HUGE buy signal as far as I'm concerned.

Our host, Michael Kosares (a fine guy in his own rite) can be reached at 800-869-5115.

Kind regards to all........CM

PS: Farfel had a brilliant post over at GE the other day.
TheStranger
ET
Thanks for the articles. Whatever the cause, unemployment is lower today than it was a year ago. Auto sales are higher than a year ago. New home sales are higher than a year ago. Airline travel is higher than a year ago...etc.,etc.,etc. So I have trouble swallowing your argument that the general economy has been slowing for a year. If anything, I would say that we have been overheating. I think your Schumpeter article supports this view when it asks, for example, "Is it appropriate for central bankers to base policy on so-called productivity advancements, while an economy is in the midst of historic credit growth, as well as financial and economic boom (especially considering $30 billion plus monthly trade deficits)?

I would not, however, quibble with the notion that the seeds of the next recession have already been sewn. It is going to take more than just 6 1/2% fed funds to reverse the effects of the recent money explosion. Higher rates will be needed either to restrain credit expansion or to support a falling dollar or both.
TheStranger
Cavan Man
Wow. When you finally get around to posting, you drop a doozy! Great post, and thanks for the insight into corrogated cardboard. Wall Street has long considered your industry to be the canary in the coal mine and for good reason. As you say, it effects everything we touch.
Bonedaddy
Applying for asylum in AURORA
Total, I hope this is the Aurora on the north side of Denver. I hereby request political asylum. (The Aurora I know has a great shooting range out on Gun Club Road.)
But, I understand that I must earn my citizenship to your sovereign state, so I'll have a go at the test questions.
I would answer no to the one about running up a huge debt in anticipation of a dollar collapse. It could turn out to be a deflationary collapse because much of the "currency" is held in the form of electronic data entries and isn't even backed by cash. Surely one of the fine minds here at the forum has an idea of how much cash is in circulation vs. how much debt is owed. (I would be very interested to know that ratio if anyone is inclined to post it.) But I'm pretty sure there is no where near enough cash in the hands of Clintons subjects to conduct more than a few days business in his dictatorhip. Besides, if your sovereign state is to be a republic, you wouldn't want to start out by intentionally stealing from your creditors by paying off your debts with an inflated worthless currency, leave that game to the democracies.
Should you peg you currency to GOLD? Of course. GOLD has been extremely stable in price compared to other currencies over the past few years. You can call the one ounce pure GOLD coin coin the "Aurorian" It will be worth at least 290 Clinton dollars. And everyone knows how that fool loves to print paper. Soon it will take more than 300 Clinton dollars to buy your "Aurorian". Sign me up. Say, I would be happy to help train Aurora's "well regulated militia",
CoBra(too)
Hello ET - Bre- X - vs accounting standards -
Sir ET - the Bre-X scandal was a mine salting scandal of major - before unheard -proportions, corrupting all standards, and the fault was with most of the then "oh so" smart gold mining analysts. Most of them had not done their homework at all, until it became too big to fail - what a shame those decrepit "insiders" were dragged to Busang and given the same standard theme of 0.31 oz/pt -forever - no deviation -ever. That (and maybe) more I've asked John Felderhoff at an early presentation in Geneva -as the stock price was still C$ 2,50- as the BRX hit the equivalent of 300 Bucks - why after all an Edinborough co. sold the main Busang for scrap (after drilling 40 holes without a trace of au) to these cheats, virtually - ... needless to say, I didn't make many friends in view of the performance of the Co.(nspirator). - Though I'm still mad at the TSE, telling the world it's been the fault of their cowboys out west. - IT Has been the TSE not doing their due diligence - it is like the CFTC not bothering about blatant price manipulation in certaain sectors of the COMEX or NYMEX.

ET - you're talking reality. You're talking about accounting standards, which have historically set valuations of company's and their their performance relative to their sector in regard to growth, cashflow, earnings , price/book and other "standardized" measures. Measures, or maxims which have been virtually abandonded in the new era economy, as even A.G. underwrites to the detriment of his real beliefs - at least according to his recorded history - and as history re-asserts - creative accounting finally will be over-whelmed by "massive overcreation" of DEBT! - a debt no accountant's imagination will be able to "discount" in terms of future expectations - is it corporate or government or lastly only virtually corrupt - and who the hell cares?

Thanks and have a great weekend - cb2
SHIFTY
Clinton set to offer "Tens of Billions" for mideast peace
http://www.telegraph.co.uk/et?ac=003112450302313&rtmo=lnS7ou7t&atmo=99999999&pg=/et/00/7/16/wmid16.htmlGreen ink and fiber! Yeah right ,that will fix it!
Ole Clinton is a regular Robin Hood.
TheStranger
Buy Signals
Cavan Man - I'll give you another buy signal. 52 weeks ago, on Saturday, July 16,1999 this forum had 73 posts. With only 2 1/2 hours to go, we have only 17 today including this one.
SHIFTY
Gold Fields signs BIOX deal
http://www.bday.co.za/bday/content/direct/0,3523,656677-6094-0,00.htmlSA GOLD mining group Gold Fields Limited said yesterday that it had signed a technology agreement with Uzbekistan's Navoi Mining and Metallurgy Combinat.
The pact, through Gold Fields' Biomin Technologies SA, a wholly-owned subsidiary, provides BIOX technology for treating refractory gold concentrates at the Kokpatas mine, near Uchkuduk in Uzbekistan. BIOX technology is a biological leaching method for extracting gold from surface tailing dumps.

The first phase of the project will be commissioned in January 2003, with full capacity by 2005, Gold Fields said in a statement. No financial details of the transaction were available.

The plant will treat 2100 metric tons a day of gold concentrates, and will have a capacity five times that of existing BIOX facilities, Gold Fields said.

It has 10 other BIOX treatment agreements with miners around the world. Dow Jones.

-By Andi Spicer, Dow Jones Newswires; +27-11-726-7903; andi.spicer@dowjones.com

elevator guy
Racial hatred as expressed on this forum
Since there was a wave of "anti-Semetic" posts here several weeks ago, I have been doing a little reading about suppossedly revealing subjects, on various web sites.

As I wade through it all, it seems full of the usual "us-vs-them" diatribe, (yawn)

And as I read, a funny thing occured to me.

On the one hand, these people claim that there is no longer a pure Jewish race, and even claim that the Jews we know today have only a tiny fraction of the genes from Abraham.

Just for the sake of today's argument, lets say they are correct.

Well how is it then, that these same people claim the Jews are behind a world wide plot to overthrow all the Christian governments, and make way for the Satanic Messiah?

The two view points are not compatible, and belie the fallacy of the so-called Christians who tout such nonsense.

If there are really Jews alive today, setting up the New World Order, then the notion of intermarriages during the diaspora diluting the gene pool to the point of being unrecogizable as Abrahams' decendants would render the Jews of today as just Semetic, and thus they could not be blamed or accused as being Jews at all. Which would mame their actions merely secular, and not spiritual in nature.

But if there is really an evil Jew lurking around every corner as they claim, taking every opportunity to lay waste to the so-called Christian race, (not that there is one, thats just what they call themselves), and if there really is this Jewish world wide conspiracy, then we would have to conclude that there really are Jews alive today, with more than just a smidgen of Abrahams' DNA, and this fact would be in direct opposition to their claim that the word Jew only now refers to a religion, and no longer a race.

So their teachings are hopelessly internally conflicted, and the whole of their premise falls flat, having only fear and hatred as its foundation. And upon this shakey foundation, they add psudo-intellectual hypothesis, to occupy their minds, and give themselves a "gospel" to talk about, and recruit new members.

This stuff doesn't pass the smell test, and wont stand the light of day.View Yesterday's Discussion.

Looking Up
Britain joining NAFTA/ Britain to adopt EURO
Interesting Geopolitical analysis about Britain

WORLD AFFAIRS BRIEF JULY 14, 2000 Copyright Joel Skousen. Quotations with attribution permitted. Website: http:/www.joelskousen.com


BRITISH BUSINESSMEN TOLD, "The Euro is coming, like it or not."
A group of British business leaders were invited to meet with a Member of Parliament (MP) this week and were told that Britain is going to switch from the pound to the Euro, whether the people want it or not--so they had better get used to it and start purchasing the necessary accounting software and hardware to handle the change. Changing all cash registers and accounting systems in Britain will be very costly.
ANALYSIS: This is typical of the high-handed way in which government treats its citizens. This meeting was assuredly "off the record" --part of the mystique of impressing the attendees that they were initiates into some inner circle of confidants with government. It's sad how people can be corrupted by the idea that they are "in the know." They are so proud of the fact that they have become "insiders" with "access" to government that they can't see they are being used to help condition other business people into accepting that which would otherwise be politically impossible. At least one of them had the courage to speak up privately, and his statements were passed along to me by a mutual friend. Increasingly, nations are filled with businessmen who have no allegiance to any principles of national sovereignty or economic rights. They are only interested in surviving and since big government is the main force to be reckoned with, that translates into willing submission. Part of this changing attitude is due to the fact that most CEO's are hired managers and not true entrepreneurs. They don't have a real stake in the free market, only a high priced job that requires fealty to high authority and making money as the only criteria for success.

.
BRITAIN TO JOIN NAFTA? In a related story this week, the US announced it is considering inviting Britain to join NAFTA. This shocking and somewhat illogical announcement comes on the heels of a major controversy in the UK over talk about whether or not it is inevitable for Britain to join in the EU single currency--the Euro. This invitation appears to be an irrational proposal given that Britain isn't even part of North America, except when you read it in light of the two factions battling for control over the leadership of the NWO. If the US/British faction of the NWO loses the power of the British pound in international currency and that financial power goes over to the Euro, the European faction could be in a position to finally challenge the strength of the dollar--and later, the powerful organs of international finance presently run by the US/British faction (IMF, World Bank, BIS etc.). The invitation for Britain to join NAFTA may be a way to give the British Tories a balancing lever to counter PM Tony Blair's headlong capitulation to the EU.
ANALYSIS: This is an important battle that dovetails with some dramatic happenings announced in Europe last week. Germany's Gerhardt Shroeder and France's Jacque Chirac proposed moving ahead much faster toward European integration into a super state. To bypass the slow tedious process of agreement between the various EU states, Chirac is proposing a core group of nations (France, Germany and Italy) leap ahead and begin acting as a Euro-state to lead the way for the others. They will form a unified army, a rapid reaction force and immediately push for the Euro's adoption in these core countries. It appears as if the Powers That Be on the European side are trying to move dramatically ahead to assert European dominance and steal the initiative from the growing anti-EU grass-roots sentiment in Britain, Austria, Switzerland and France. Stay tuned; this is going to be a big year for change on the global political map.

Bonedaddy
Clinton buys a legacy
http://www.telegraph.co.uk/et?ac=003112450302313&rtmo=lnS7ou7t&atmo=99999999&pg=/et/00/7/16/wmid16.html JUST PRINT THEM SOME MONEY, SO THEY'LL STOP FIGHTING! Bill Clinton, benevolent dictator of the United States, unilaterally decided a few days ago that it was time to summon the mid-east leaders to the wood shed. (See here boys, this feudin's gotta stop!) Clinton is a quick study, I'll have to give him credit for that. It only took him about a week to figure out that these fellers have been going at it longer than the Hatfields and the McCoys. Ever the skillful negotiator, the American king fell back on a tactic he had developed at home while daughter Chelsea was in her turbulent teens. Sometimes Hillary and Chelsea just couldn't find any common ground to share. (Just like these here ol' boys from the mid-east.) Wise and benevolent King Bill just gave the girls a couple of thousand bucks apiece and sent them to the mall. Peace at any price? No problem.
(I tell you what boys, I'd sure like to see the look on ol' George Bush's face when his Republican buddies in congress balk at payin' up. Well, I better light a shuck outta here now, an go somewheres that ain't got no extradition treaty with the US of A, if ya' know what I mean. China, now there's a hell of an idea. You know them wimmen over there sure know how to treat a fella right.....)
wolavka
Fridays gold action
Nice little inside day for dec gold.

I would not want to be short this mkt. this week.
Cavan Man
Shifty
"tens of billions" for ME peaceMoney can't buy love. IMHO, "peace" will never be bought here and cannot be had for any price. History denies it.

This act should drive the price of most everything (including oil) much higher.
HI - HAT
Biotoc Sequences
Currency Wars will soon be the least of it.

The Crowd is always wrong. The star of Contrarianism is always looked up to by the anointed, but few grasp that the Galaxy itself is Perverse.

The tide began coming in again around the time that MichealAngelo skethed a Helicopter, maybe Genomics now marks the High water point for this cycle.

Pundits busily compare what was yesterday, with what will be tomorrow. The larger cycles of Mammon, document that for some civilizations that tomorrow never comes.
JavaMan
Good morning all...
Sir ET, in your msg#: 33488 to ORO you said...
"We all agreed a book would be well-received but finding a publisher in today's environment might be difficult."

Not necessarily true. Publishers typically offer several different kinds of programs regarding publishing a book. Proven authors are usually given an advance payment towards a new book and then a percentage paid in royalties. Authors that aren't established or "proven" can get their book published for if they pay some amount in advance to the publisher to help finance the initial run.

To Sir ORO, All:

If you are interested in publishing but find financing an issue for what ever reason, perhaps you would like to consider the formation of a company who's shareholder's investment is used to finance the publishing of your book(s). Depending on the number of people interested, this may turn out to be a rather small investment.

Thoughts?
JavaMan
ooops...
Don't know where that first "for" came from in my previous post. If we move forward with the idea, somebody else better do the proof reading.
JavaMan
Cavan Man, re: your msg# 33520, fanning the flames of conflict...
http://www.mises.org/freemarket_detail.asp?control=176&sortorder=subject
Last week I posted the above link that offers an interesting perspective for what is going on with oil. From that link: "The war in the Gulf was a war against the competition with the partial purpose of knocking Baghdad out the world oil market."

One question I still have is how could Saddam Hussein have been so foolish as to move on Kuwait or was it some kind of trap he stumbled into? Certainly, one can justifiably assign many negative attributes to him but being stupid is not one of them.

So, if nothing else, it appears Iraq's oil reserves have been earmarked for use at a later time (at a much higher price?) What a creative form of rationing.

At some time in the future will we make nice with Iraq as we recently did with Vietnam, or is there some other scenario by which we will extract Iraq's oil?
canamami
Reply to "Looking Up" - Where does the UK go?
Think of Orwell's "1984". The issue is: Does Britain want to be part of Oceania, or Eurasia?

Basically, it seems to me that possible NAFTA membership is the last alternative the Euroskeptics can throw up against the UK's final and complete absorption into Europe. The Canadian newspaper magnate Conrad Black - who is a big Anglophile - has been touting the UK into NAFTA as his pet theory for a while, and he has been joined by some old-fashioned British Tories, and also Henry Kissinger said it would be a good idea.

So, does the UK go with geography, to Europe, or with culture and history, to an alliance with the rest of the old British Dominions (Canada, Australia and NZ) and the US (i.e., the Anglo-Saxon world)? One difference: Given the end of the old British Empire, the new "colonies" will be the US sphere of influence in Latin America and maybe areas like the Phillipines. One caveat: Where do the Celts go? Eire has already opted for Europe, but what will Scotland, Wales and Northern Ireland do? Will Scotland leave the UK to recreate a version of its old alliance with France, by joining Europe? How would the UK joining NAFTA impact on the Northern Irish question? Has the likelihood of the UK opting for North America been enhanced (I mean relatively, because I think the UK is still going with Europe) by the questionable admission of Italy and Greece to the Euro zone?
lamprey_65
That four letter word...
What four letter word brings forth hatred, fear, and dread to the banker?

G-O-L-D
lamprey_65
Do we have a pattern?
Summer '98 -- Market rallies from June thru the second week of July and then falters.

Summer '99 -- Market rallies from June thru the second week of July and then falters.

Summer '00 -- Market rallies from June thru the second week of July and then?...
SteveH
Kondratieff et al
I just read an article about Elliott waves and the Kondratieffn cycle of 54 years that last dipped in 1949. That means that the next large dip in the world stock markets should arrive around 2003.

Given that gold has risen to a 2:1 (two ounces = 1 DOW) or better ratio to the DOW six times in the last 100 years, and that in 1929 the DOW apparently went down 89% of its high, that would then compute to approximately 1200 on the Dow and a gold price of 600 or higher sometime in 2003-2004.

So does that mean we would have to wait through this deliterious gold fiasco for three more years whilst the powers that be constinue to sell gold forward and naked short the gold market from the estimated five years of annual production to 10 or more years?

What would it mean, if the FOA/Another scenario of $30K gold came about? This does not appear to be supported by the above 2:1 DOW, for it it was then the 89% retracement in a 2003-4 timeframe would mean that gold would have to go to a 10:1 or better relationship to the DOW to meet this high price in dollars. What it could mean is that the DOW will rise to 30,000 and gold to 15,000, but from the paper I read on the Kondratieff cycle, the $30K gold price is not supported in that relationship. If the DOW retraces by 89% from its high by 2003-4, and gold goes to $30K in that same timeframe, the relationship is kaput...unless ...hmmm...one factors in a change in reserve currencies in which the DOW no longer is measured in dollars but in Euro's. Not that would be a stretch.

So, how can these historical cycles and waves and theories result in a historical shifting of gold to a 2:1 to the DOW, if the DOW retraces better than 89% by 2003-4 and still support a $30K price in gold? That is the question. Thoughts?

Perhaps these are not times as before.
Boxman
Cavan Man ,Same line of work - Post #33508
<>

Cavan Man, I be one of them box salesman 2.

Lead times are longer than I have ever seen them in 26 years. I have always felt that the box industry is a great barametor of the economy, as the vast majority of manufactured products go in one.

By the way, I sell for the company that, behind the U.S. gov't, is the largest landowner in the land, and caretaker of the spotted owl, boy did that ever hurt, especially to the increased cost of building a home.
Cavan Man
Boxman
I work for a recent IPO and am waiting for the other shoe to drop. Consolidation and change; the industry will continue to suffer both. High regards to a fellow boxmeister!
DaveC
JavaMan (07/16/00; 07:31:24MT - usagold.com msg#: 33524)
A couple of quick rumors to stir your imagination.

One, Iraq was financed by US in the 80s to be a deterent to Iran. Paid for by US and other Gulf govs. Gulf govs renege on payment so Iraq invades Kuwait.

George Bush is a business partner with Saddam. Sounds wild right. See http://www.skolnicksreport.com/greenspan1.html
for more. makes for interesting reading.

I would think we will make nice when the time is right to make nice. And who's to say he is not selling oil now? It's impossible to tell.
RossL
Boxes
http://home.columbus.rr.com/rossl/gold.htm
I recently moved to a new city. The move was paid for by my employer. The packers/movers used dozens of brand new boxes. The boxes were used for approximately 24 hours and then many of them discarded. What a business. Good luck you guys!
Goldfly
WOO - HOO!!!

Spot Gold up to 282.00!!!

After the BOE speed bump gold has recovered all of it's losses.

THIS IS VERY BULLISH FOR GOLD!!!!

Woohoo!



So, what do I know? Nothing!

But I've always wanted to say:

THIS IS VERY BULLISH FOR GOLD!!!!

Stay tuned.

gf
elevator guy
Interesting quotes along the trail, although not verified, still chilling
Congressman Jerry Voorhis: "The banks -- commercial banks and the Federal Reserve -- create all the money of this nation and its people pay interest on every dollar of that newly created money. Which means that private banks exercise unconstitutionally, immorally, and ridiculously the power to tax the people. For every newly created dollar dilutes to some extent the value of every other dollar already in circulation."

Congressman Patman: "Mr. Eccles [Chairman of the Federal Reserve Board], how did you get the money to buy those two billion of government securities?"; Eccles: "We created it." Congressman Patman: "Out of what?"; Eccles: "Out of the right to issue credit money.", The House Banking and Currency Committee; September 30, 1941

Congressman Wright Patman, Chairman, House Banking Committee: "In the United States today we have in effect two governments ... We have the duly constituted Government ... Then we have an independent, uncontrolled and uncoordinated government of the Federal Reserve System, operating the money powers which are reserved to Congress by the Constitution."

Journeyman
RE: A couple of quick rumors @DaveC msg#: 33531, JavaMan msg#: 33524

I saw credible corroborating info that one of the reasons for Bush's invasion of Panama was that Noreiga crossed one of the Bush brothers by failing to have the Panamanian govt. build a promised power plant to supply a resort project of his in Panama.

There was a story out of Florida during the Bush presidential run, run only once, claiming that Jeb, I believe, was busted for cocain dealing in connection with a CIA operation, apparently Contra related. The story was squashed, or at least I couldn't find it again to tape it. And believe me, I tried.

Remember the "oil-for-food" deal with Iraq after the flap over the Iraqi 100,000 or so kids and women that apparently died as a result of "collateral damage" from the "Gulf War?" Well guess who gets all the oil?

- US has become the major importer of Iraqi oil, mainly
because of the "Oil For Food" program. UN monitors actually
measure and control the oil valves, monitoring the amount of
oil allowed for export. If the UN monitors are pulled out,
the Iraqi tankers will no longer be permitted to sail, and
the oil won't be shipped. However, there is about a six-week
delay before it arrives in American ports. -Steve {Kitel},
energy reporter for Wall Street Journal and Peter Beutel,
Cameron Research, CNBC, 17 Dec 1998, ~8:27:42 AM EST

- The Oil For Food shipments have continued, despite the
bombing attacks on Iraq. -The Cavuto Business Report, FNC,
17 Dec 1998, ~5:41:35 PM EST

- US Oil companies are the major buyers of Iraqi oil. -Roger
Diwan, Petrolem Finance Company, CNBC, 18 Dec 1998, ~1:26:05
PM EST

- An oil shipping center in Basra was bombed because it was
a source of _ILLEGAL_ oil shipments. -Sec. of Defense
William Cohen, CNN Live, 18 Dec 1998, ~12:12:14 PM EST
[emphasis by Cohen]

Regards,
Journeyman
TheStranger
A Thief in the Night
On this day 52 weeks ago this forum was posted 52 times. Today, including this one, it has been posted 18 times (providing someone isn't pre-empting me as I write). No wonder. Since last year we have learned what an anticlimax the Euro introduction was. Y2k has proven a dud, and the Asian contagion has disappeared. But, ironically, the one deadly serious threat facing the dollar during this period, the effect of excess money creation, was probably the least understood of all. And, trust me my friends, it is still very much with us.

Friday, gold gained a buck. It is up another $1.80 as I type. And so it is that the newest gold rally comes to us, like the greatest of all rallies, as does a thief in the night. I just hope all of those wonderful posters from last year are still in their seats. I have my suspicions.
Black Blade
Au up, Pd up tonight.
Au is up +$2.90 and Pd up +$6.00 in overnight trading. Pt is down -$3.00. Looks to be an interesting night. Maybe the guard dogs have taken their eyes off of the bone and are about to have it taken away from them. Let us see how this shakes out until the NY open.
Black Blade
Interesting article with contradictory conclusions.
http://www.boston.com/dailyglobe2/198/business/Gold_lust+.shtmlLOOSE CHANGE
Gold lust

By Susan Trausch, Globe Staff, 7/16/2000

Gold!

The word, the metal, and the prospect of unfathomable wealth has bewitched man since he learned to count, and bewitches him still even in this age of plastic and paper.
That's why Peter Bernstein is so interesting - he has peered into the heart of avarice and tells the story of human nature at its worst in his book ''The Power of Gold: The History of an Obsession,'' to be published by John Wiley & Sons, Inc. this fall.

He calls himself ''the old man of Wall Street,'' which is pretty accurate since he went into the investment business after graduating from Harvard in 1940. He now runs an economic consulting firm in New York and publishes a twice-monthly newsletter called ''Economics and Portfolio Strategy.'' But he could pass for a psychologist, given his exploration of human risk in his bestseller ''Against the Gods.'' He followed that project with the gold book because ''I always hated gold and gold bugs and the Gnomes of Zurich, and the gold standard.''

He is a wry, contrary Solomon, judging the evil and the ridiculous exploits of man chasing a metal through the ages. He tweaks a person's lust for the stuff even as he deplores it. ''Gold is a very powerful symbol and has shaped much of human history,'' he says in an interview. ''It represents eternity because it is so unchanging. Every other thing we have has a much more finite existence.''

Noting that all the gold ever mined is still on the earth, he chuckles and says, ''The gold in your earring or wedding ring might have come from Hatshepsut's column.'' He refers to the Egyptian queen whose love of gold was so great that she used to decorate her face with a gold and silver dust. She built two giant pillars peaked with gold as monuments to the god Amon Re. Having a piece of Hatshepsut's rock is a compelling, if unlikely, notion in 2000, when gold is still a status symbol, if only a decorative one. While no longer the coin of the realm, or a serious investment, it sends a powerful message across many a board room, glinting from the Rolexes of politically savvy wrists.

Chains, pins, bracelets, and pierced body parts make their 14- and 24-carat statements, advertising that a person has cachet and cool. Plumbing fixtures, cabinet knobs, lamps, and wallpaper with gold threads speak of gravitas in home fashion. Chi-chi restaurants sprinkle gold dust on their overpriced entrees, while some designers even weave it into clothes. Gold glitters through myth and fairy tale, ever firing the imagination - Rumpelstiltskin, King Midas, Jason and the Golden Fleece, the pot of gold at the end of the rainbow, the goose that laid the golden egg, and the stories of yellowed maps leading to buried pirate treasures. The old movie ''Solid Gold Cadillac'' lives in a lot of car fantasies, while the theme from the movie ''Goldfinger'' is a classic, calling up the image of James Bond's beautifully dead girlfriend, painted head to toe with gold paint.

History has its own parade of factual horribles: Crassus, the wealthy Roman military leader executed by having molten gold poured down his throat; Atahualpa, the Inca emperor, murdered in a room surrounded by his gold after Pizarro's troops plundered the kingdom; the human misery in the African gold mines where slaves worked, lying on their backs.

The story of gold is full of irony with the reluctant Johann Sutter wanting nothing more than a nice grist mill out of life, and cursing his big discovery. There is Charles de Gaulle, attempting to rally the world to the gold standard to glorify France and cripple the dollar, and then seeing his own country sink into economic chaos.

Americans were fools for gold, too, having a love/hate relationship with it throughout the 20th century. The craziness reached its zenith in 1980 when speculators drove the price of gold to $850 an ounce.

And then poof.

Now, here we are at the start of a millennium with the dollar and the stock market ruling our world, and gold fever under control, more or less, give or take a few extravagances. Are we OK, Peter Bernstein? Or will the spell take us beyond baubles and into ruin once again?

''No monetary system has ever been permanent,'' he says. ''They all have feet of clay. And looking ahead, who knows?''

Wisdom worth its weight in gold.

Black Blade: This anti-gold old man of Wall Street makes a good case for gold if he likes it or not. The track record of most Wall Street analysts isn't all that impressive, so it isn't any wonder then that any competition for investment is unwelcome. BTW, Pt now up +$3.00, and Rh up yet another +$50.00.
Henri
Hi All...I'm back
Just returned from an enjoyable vacation in the Canadian maritime provinces...New Brunswick, Nova Scotia and Prince Edward Island. Looks like I didn't miss too much as POG still holding near $280 US...but looking up for some morning action or squashing...we will see. Good Night and may God bless.
SHIFTY
PPU
Periodic Ponzi Update!From 7/14/00


Nasdaq 4,246.18 + Dow 10,812.75 = 15,o58.93 divide by 2 = 7,529.46 Ponzi

UP 199.87 from last week New York Average.

$hifty
Chris Powell
"Ici est tombe....": On choosing to fight
http://www.egroups.com/message/gata/507?Reginald H. Howe of www.goldensextant.com
makes an appeal for GATA.


To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@eGroups.com
Gandalf the White
Ok-- Here is one to start the day.
Friday July 14 1:44 PM ET
Moody's: Junk Bond Default Rate Soaring
By Jonathan Stempel
NEW YORK (Reuters) - The rate of junk bond defaults rose to 5.43 percent in the second quarter from 4.82 percent a year earlier and will soar to 8.4 percent next June as credit quality drops, threatening the survival of many companies, credit rating agency Moody's Investors Service warned on Friday.
The second-quarter default rate is the second highest since 1991, said Moody's, which is considered conservative in its prospective assessments of corporate credit quality.
A growing default rate is commonly associated with a U.S. economy that is slowing or in recession. Moody's said a rise could be a leading indicator of a general economic decline.
Moody's said defaults will surge as financial problems start to hit low-rated companies that sold junk bonds in 1997 and 1998, when investor risk tolerance was ``extremely high.''
``Some on the Street expressed the opinion that the high failure rate that we had seen among this class of issuers in 1999 was a one-time event and that the risk was largely over coming into 2000,'' said David Hamilton, a Moody's analyst. ''But we believed the lull we were seeing was only the eye of the storm.''
``The implication for default rates going forward is that unless the economy slides into a full-fledged recession -- which most economists consider unlikely -- macroeconomic conditions will be almost irrelevant,'' said Hamilton.
Junk bonds carry ratings of Ba1 or lower from Moody's and are considered to carry high ownership risk.
Moody's said 37 companies it rates defaulted on $9.6 billion of debt in the second quarter of this year. That surpassed the $8.7 billion in new junk bonds that were sold during the period, according to Thomson Financial Securities Data.
Defaulting companies included movie-theater operator United Artists Theater Co. of Englewood, Colo., industrial waste service giant Safety-Kleen Corp. (NYSE:SK - news) of Columbia, S.C. and its largest shareholder, Burlington, Ontario-based bus operator Laidlaw Inc. (Toronto:LDM.TO - news) (NYSE:LDW - news)
Some 23 companies defaulted on $7.4 billion in the first quarter, when the annualized default rate was 5.66 percent, Moody's said.
No industry sector dominated the defaults in the second quarter, Moody's said, and 72 percent of the defaulting companies, accounting for $8.3 billion of debt, came from the United States.
===
<;-)

View Yesterday's Discussion.

wolavka
dec gold
resistance at 292 than 298 than we will go someplace. hang on.
Black Blade
Morning Wakeup Call!
Source: Bridge NewsTHE FAR-EASTERN FRONT:

China's PBOC aims to export all silver reserves, sources say

Hong Kong--July 17--The People's Bank of China (PBOC), the country's central bank, is said to be aiming to export all its silver reserves, sources in China said on Monday. The PBOC is believed to have held about 800 tonnes of silver reserves before it started exporting the reserves in 1999. Many Chinese silver producers, however, remain reluctant to export large amounts of silver because domestic prices are higher than export prices, the sources added. (Story .12123)

Black Blade: Thats right, every scrap. Get it all outta here!

Asia Precious Metals Review: Spot gold rises on short-covering

Hong Kong--July 17--Spot gold rose in Asia on Monday due to short-covering from Australia, Japan and the U.S., dealers said. But selling from European sources eroded Asian gains late in the afternoon, they said. Gold isn't expected to rise above the nearby resistance of U.S. $285 in the U.S. and European markets as the short-covering diminishes. Spot silver and platinum also rose in step with the stronger gold. (Story .2200)

Black Blade: Back to fun and games until the next BOE auction, then drop the price, give away Brit Gold, and then let er� rise again����Lovely!

Meanwhile, Au is up +$2.30 at $282.70, Ag +$0.02 at $5.02, Pt up +$8.00 at $578.00, Pd up $13.00 at $687.00, and Rh up another $50.00. The PGMs are up sharply as it becomes apparent that Russia cannot deliver and Amplats prepares to expand operations. Interesting since Amplats is usually very cautious and this signifies a sentiment towards expected higher prices. I look for Pt to make a run at $600.00 and Pd for a possible run at $800.00. Oil is down -$0.51 at $30.89/bbl on little news. The refinery capacity problem is still there of course, and this will play on speculators minds as a possible run toward $40.00/bbl is likely. It should be a no-brainer, especially if Asia continues to recover. The S&P Futures are up +1.50, fair value +1.00, indicating a neutral to almost perceptible positive open on Wall Street at these levels. SA golds begin reporting earnings today with Harmony Gold leading the way as usual, The weakness in the Rand bodes well the SA Gold profit picture, as they pay for services, labor and equipment in Rands, and sell Gold in dollars.

Journeyman
A comforting thought

~"For the first time, applications to law schools have exceeded applications to business schools." -Myron Candell, CNN Headline News, July 05, 2000, 2:23:22 PM

Regards, j.

USAGOLD
Today's Report: World Gold Council's Fukuda Blasts Bank of England, Blair Government
Note: We are having a technical problem this morning with the report. It will appear here and possibly at its regular page later in the day. Thank you. MK


(7/17/00) www.USAGOLD.com Market Report. . . . .With the Bank of England sale (and possible aftershocks) safely out of the way, gold started the week on a positive note. Overnight the gold market featured short covering in Asia with traders fretting over whether the building market for gold in Japan would get an additional boost from the Bank of Japan if it decides to leave its interest at 0%. One Asian trader, quoted in Dow Jones, echoed an oft-heard sentiment in gold trading circles when he said, "I feel, as almost everybody does, auctions and other official sales are losing their role as market driving factors. Players are not as responsive to these sales as they used to be." The poor results from last Tuesday's BOE sale had no effect on the gold market and were passed off as typically symptomatic of gold's annual summer doldrums. Also featured in the early trading are reports of a "strong technical outlook" for gold. This week we have June Consumer Prices tomorrow, the Trade Balance on Wednesday and Housing Starts -- all of which should have an effect on markets in general and gold in particular.
We'll see you here tommorrow, fellow goldmeisters. Have a good day.
CoBra(too)
MK- if I may I would like to bring up very original thoughts -
... and please don't construe this as touting another site!
As I don't know if there are any of you reading Bill Buckler's "The Privateer" from the land of Oz. A brilliant geo-political and economical overview - served as an ongoing saga of the few independent thinkers.
Since I didn't ask for permission to post anything discussed there - I would venture to have B.B. talk for himself, as he has repeatly, though rarely on these few gold fora.

I, personally would feel Bill Buckler - and he contributes if rarely - as we have our Chris Thompson (representing GATA and Bill Murphy)- would be a great addition to this site of monetary seekers of truth.

Hoping not to have overstepped my welcome, MK, I still feel BB may be a great addition. Yourss cb2
beesting
Profound words from Reginald H. Howe.
http://www.egroups.com/message/gata/507?Link provided by Chris Powell, last night.


<>

Thought this paragraph deserved a second look.....beesting.



Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/Official release
http://www.bog.frb.fed.us/releases/H15/update/

Official: Federal Reserve Statistical Release

Release Date: July 14, 2000

Rates for Thursday, July 13, 2000

Federal funds 6.50

Treasury constant maturities:
3-month 6.18
10-year 6.01
20-year 6.15
30-year 5.81

upside-down spread FF vs long bond = (0.69%)
Hill Billy Mitchell
Official release
http://www.bog.frb.fed.us/releases/H15/update/
Official: Federal Reserve Statistical Release

Release Date: July 17, 2000

Rates for Friday, July 14, 2000

Federal funds 6.51

Treasury constant maturities:
3-month 6.17
10-year 6.10
20-year 6.24
30-year 5.88

upside-down spread FF vs long bond = (0.63%)
SHIFTY
Confused
While checking some of my shares today I noticed ( American Depository "Receipts" and American Depository "Shares" )

Q : What is the difference?

Harmony Gold Mining Co. Ltd. HGMCY Nasdaq-NM
Stock Type: American Depository Receipts

Gold Fields Ltd. GOLD Nasdaq-SCM
Stock Type: American Depository Shares

$hifty
:)
CoBra(too)
"The Stranger Index" ...? ... No posts-no too few... au! ....
It seems to me the less posters, the less interest in gold
by the "bugs".
Is it the "final" realization, that the market IS rigged, or is it the ultimate resignation, that - while the market is rigged - we all are either condemned to eternal underperformance or are we willing to show the resiliance we've shown so far ... id est, gold is true money and the only true money - ... So what ... the market is rigged ... so what, the market is rigged by the same names, rigging markets before. These names are starting to surface ... and -ideally ... even CFTC or other mkt. surveillance out-very...mis-fits- (is it official's - like SEC) can't help to find perpetrators.
Anyway, to make a too long story short(-er)- I just want to contradict Sir Stranger - to no avail -as it seems in terms of Goldman's sucking gold range (Bill Buckler - here's another one?) - BTW - your fault MK!
Regards cb2

PS: The "stranger" an index - the more aappreciating?
R Powell
Treasury numbers

Mr. H.B.M., thanks again for the daily effort with the treasury numbers. I noticed something new today. I've been half convinced that the government buy back of the 30 year note was a reasonable explination of the low yield but today's readings showed both the 10 year and the 30 year lower than the 3 month. If memory serves, I believe you told us the curve inverted on March 22 past and also that the inverted curve is an early indicator of a troubled economy-- usually indicating trouble about 6 months before its' arrival?? Another signpost of things to come?

Trivia question for all- what is the occupation of the only contestant to miss the very first ($100 ) question on T.V.'s Who Wants To Be A Millionaire ?
Answer shortly!
CoBra(too)
@F*
Sir F* - As I'm constantly making an A* of myself - your work doesn't deserve the denigrating of other fora! cb2
CoBra(too)
A Leigh Special ...
Some see the era of gold
- and -
appreciate the age old
golden truth -
to be told
again
to the youth -
not in vain-
nor for gain -
though again -
- to remain.

best cb2
Leigh
Co(bra)too
Dear Co(bra): Thank you very much for your poem. You have been a great comfort to me. To all: Co(bra) generously sent a delicious chocolate torte to me for my birthday. Upon learning of my father's death last week, he wrote this poem. What a wealth of friendship we have on this Forum!
beesting
American Depositary Receipts and American Depositary Shares.

Hi again Sir SHIFTY,
The way I understand the book,"The A to Z of Investing", there is no difference, kind of like "Bob & Robert, same guy!

From the book:
American Depositary Receipts:
Abbreviated ADR. Also, American Depositary Shares, abbreviated ADS.
A negotiable receipt issued by an American bank for shares of stock in a foreign corporation. The underlying stock certificates are deposited in a bank((beesting comment...probably used as collateral by the bank))--and the ADRs/ADSs are traded in American markets in their stead.(in stead of)

Much more in my book, but I think you get the picture....Those in the Know are still buying Gold...beesting.

beesting
Lady Leigh
So sorry to hear about your loss, it's a tough one! My dad died about 5 years ago,didn't leave any Gold in his will, but many Golden memories, still think of him a lot!!!...Also belated Happy Birthday!!...beesting.
Sancho
(No Subject)
Galdalf the White---Good post on the increase in defaults. I see it at the county courthouse-used to be a small handfull but it is creeping up each month. One can only imagine (if)(when) a recession sets in. On another subject I used to be transfixed for approximately l.5 hours to read everybody. As CoBra(too) inferred, folks must have lost interest and/or squandered their money elsewhere. I would rather go back to l -2 hours reading than ten minutes as I really do learn a lot from those more gifted than i.
schippi
Select Gold Wavelet Chart
http://www.SelectSectors.com/wavelet.gif All Wavelet components of this FSAGX Chart
are pointing Up. This has to be a good sign.
R Powell
Trivia answer

Since no one wanted to venture a quess, I'll give the answer. Only contestant to strick out on the very first question on "Who wants to be a millionaire" gave his occupation as a commodity broker.

Mr. Lamprey_65, Hope history repeats again as you mentioned yesterday (33527). I just recently bought a put on the S+P. First ever attempt at an index option.

I pour and finish concrete to pay the family bills. The price of good floor mix has increased 6.66% since the first of the year. Concrete is the most widely used building material in the world and even though it's probably excluded along with other non essentials like food and energy from the CCI, this increase is an increase in dollar terms of "goods" as in "goods and services". I think the official denial of higher prices will become apparent eventually. What will it take to convince the markets? Won't this be reflected in lower company earnings? I know prices are rising- fast in New England!- but what will convince stock prices and the dollar index that inflation is not only here but has been for a while and is accelerating. What event/ indicator/ ???/ will awaken the money movers to this reality?? And when will it happen? If anyone can give us any ideas, I'll know when to buy another S+P put and we all know what POG will do!
HI - HAT
Sancho msg#33559........Calm Before The Storm
This is no doubt the calm before the storm. Between the election and the market transitions unfolding, we could have several months of this, "purgatory".

Make no mistake the wheels at every level are turning furiously behind the scenes.

Warning have and are being issued ( BIS _ June-00 ), etc..

I see it thusly. Gold and gold shares have been in a bear market for over four years. What worst case scenario that would or could have happened is behind us. Actually when most other markets begin gyrating wildly, gold in a trading range of 285 to 310 will be a rock solid pillow, for starters. Sweet dreams.............
Leigh
CoBra(too)
Please forgive me for misspelling your name. It was done unintentionally.
CoBra(too)
US-Volcano - ABX
Ted Butler - the guy, who is "gold patch'es" advocate - similar to former Detroit's menace - now running for 3rd. party recognition - see's gold leasing as dangerous to your financial health - as smoking.
American Tobacco has its multi billion class action - American Barrick ... is still - fuming ... on and on
...
cb2
Al Fulchino
Leigh
Sorry to hear about Dad, Leigh. And also belated birthday wishes.
SHIFTY
Beesting
Thank you Beesting!

That's about what I had figured, I just could not be sure.

Go American Depositary Receipts and American Depositary Shares!

Naah..., GO GOLD ! Sounds better!

$hifty
:)

TheStranger
Sacher to Me
CoBra - I have been contradicted by much worse than the likes of you, but never by any better. Hail to you, my witty friend.

How can the price of a thing be much lower than at a time when even those who normally crave it have lost interest? Perhaps I am guilty of a little wishful thinking (as usual), but it makes sense to me.

*****

Note to Leigh - My dad will always be my hero. He's in almost everything I ever say or do. I am so sorry for your loss.
wolavka
cpi will be bullish for gold
Swiss franc and gold will rally. Cpi will be stronger than expected, already on charts.
Dr. Jones
Leigh
Condolences on the loss of your father. Many on this finest of forums know well the emotions you are experiencing and are no doubt recalling memories of what were and what might have been. Please know that you are among friends.

dj
Black Blade
July PM forecasts
http://m1.mny.co.za/MGProph.nsf/Current/8525686D002E1F958025691F0040498F?OpenDocumentPM forecasts from several analysts. Some overly bearish and one probably overly bullish Au forecasts? Interesting analyses, yet I for one am Skeptical, especially on the PGMs. from theminingweb.com
Marius
Marius' Daffy Dollar Dream?
Good Evening All!

I thought someone might get a chuckle out of a fragment of a dream I had last night. It's actually not completely off topic, so I don't feel bad about posting it on a 25K day!

I was apparently at the garage where we recently had some auto work done, and the owner took me aside to show me something "really cool". He whipped a Federal Reserve Note out of his pocket, and handed it to me for inspection. It was a new denomination: $110,000! I know there was more following that scene, but it faded as soon as I woke up.

It's my first economic dream in memory, but I guess given the daily rants here against fiat money it shouldn't be such a big surprise. (Perhaps the Freudians out there might stroke their beards over the particular amount of the bill. Personally, my favorite take on Freud was from a classic Saturday Night Live skit: "Don't vorry Anna. Sometimes a banana is just a banana....")

'night all!

M
Gandalf the White
Thanks to Sancho and "YOO-HOO" -- Trail Guide !! -- Where are you ?
Thank you Sancho for #33559. Keep us all posted on the level of those filings. It is good to have eyes in important places. TRUE Public infomation is hard to find in the media.
BTW, the Hobbits have returned from Paris without finding the Trail Guide and are now puting out an all points bulletin, or "APB", for information leading to the return of the TG, and his updates on "the path". He must have lots to tell us by now. -- AND the Hobbits are "all ears".
<;-)
SHIFTY
Major World Indices
http://finance.yahoo.com/m2?uAsia/Pacific

Lot's of RED Tonight!

$hifty

SHIFTY
Gandalf
??Trail Guide??Gandalf; I sure hope that Trail Guide was following in the foot steps of a giant that decided to do some back tracking!

$hifty
:)

SHIFTY
CORRECTION !!
??Trail Guide??Gandalf; I sure hope that Trail Guide was(NOT!!) following in the foot steps of a giant that decided to do some back tracking!

SORRY TRAIL GUIDE
$hifty
:)

View Yesterday's Discussion.

SHIFTY
Gandalf/Trail Guide/All
Imagine my surprise when I read my post! (msg#: 33574)

I could not believe it!
The look on my face must have been something!
I my have to change my name!

MUD
:)
Topaz
(No Subject)

Just arrived home and was checking Indeces (tks Shifty). The XAU is up 1% for no apparent reason and Global markets are trending down, notably Japan.
Perhaps nothing to get excited about!
But, then again, perhaps!
wolavka
Gold
again resistance 292 and 298, then up we go. cpi should be supportive for metals.
Henri
It's almost time for another visit to the "Desert Rose"
Next installment is coming soon.
VanRip
Leigh
Sorry to hear about your dad. I hope he was as much a hero to you as mine was to me. Time should cement in your mind the good times you shared with him, and you will smile instead of cry when you remember him.
Black Blade
Morning Wakeup Call! The War front awaits CPI.
Source: Bridge NewsAsia Precious Metals Review: Spot gold moves within narrow band

By Mari Iwata and Polly Yam in Hong Kong, BridgeNews Tokyo--July 18--Spot gold moved within a narrow band of U.S. $283.10-283.75 per ounce for much of the Asian time on Tuesday with sluggish trade due to the lack of physical demand, dealers said. Spot gold is expected to fall slightly later in the European and U.S. markets if short-covering continues to be at minimal levels, they said. Spot platinum and palladium rose following the strength of the platinum and palladium futures of the Tokyo Commodity Exchange, they said.

Black Blade: Narrow band in gold trading. PGMs should continue rising, however, the TOCOM has been rendered irrelevant with its past record of default. Auto manufacturers continue to draw down PGM inventories, especially Pd. Pd should continue to outperform Pt, yet both should do well over the next few days/weeks.

NY Precious Metals Review:Platinum, palladium extend Fri rally

New York--July 17--NYMEX platinum and palladium futures extended last week's rally, climbing throughout the day to finish at sharply higher prices. While part of the rally was fueled by speculators jabbing around in thin market conditions, the overriding impetus for the climb remains strong physical demand coupled with concern over supplies from Russia. (Story .2333)

Black Blade: Ditto!

Meanwhile, S&P Futures up +0.50, fair value down -0.52, suggesting a slightly lower open on Wall Street, yet NASDAQ futures are down with fair value down sharply, suggesting a sharp drop on the open. The CPI numbers could change all that. The CPI is expected to be up 0.5% and the core rate up 0.2%. Yet these bogus numbers could surprise either up/down and the whole complexion could change at the NY open. The major Asian markets were down overnight and could be a prelude to todays action. Oil is up +$0.09 at $30.92/bbl, with rumors that the Saudi increase may be off. Besides with no additional refinery capacity it doesn't matter. In the US no new refineries are likely due to NIMBY and EPA liabilities. The Au is down -$0.70 at $282.20, Ag up +$0.01 at $5.02, Pt down (surprisingly) -$4.00 at %582.00, and Pd up +$9.00 at $710.00 on its march to $800.00.

Tamzarian
Test
Testing my Connection.
Tamzarian
What's your go0ld gonna be worth?
Wakey Wakey! What's your gold & silver going to be worth when Clinton invokes the Executive Order referenced hereinbelow? Before that Order is executed however, the Rothschilds will have driven the price of gold to a near-worthless value (oh - didn't you know that the Rothschilds control the price of gold and silver, which causes me to ponder why you intellects go through the psuedo-exercize of this forum, believing that commodities "move on their own", unimpeded by scheister-families of certain origin) and then buy the forced sale of gold, with pennies on the dollar, in that same way they bought all comodities and assets post-World War Germany.

Now, any civil-tongued comments?

Charter for Global Democracy
--------------------------------------------------------------------------------
This is taken from a letter to the editor of the TriCity Herald, July 5, 2000

"Each year, patriotic organizations celebrate Constitution Week from Sept. 17 to Sept. 23,
the birthday of the Constitution, which has protected privacy, proper rights and other
individual protection for more than 200 years.
Now, with President Clinton usurping too much power by creating laws with
more than 300 executive orders, he has set up a "green police" which is
perilously close to removing any rights from U.S. citizens and subverting the
Constitution so American sovereignty is compromised.
Don't laugh! According to the American Policy Center, he is about to endorse
the "Charter for Global Democracy." This will give the U.N. power to regulate
international commerce and tax the U.S. citizens against their will. It will establish
a standing army for the U.N. It will give the U.N. authority to dictate the
size and readiness of the U.S. Armed Forces.
It will allow the U.N. to regulate the American economy and compromise
property rights and water rights in favor of fanatical environmentalism.
It will set up an international criminal court that will violate our constitutional
sovereignty by trying Americans under foreign judges without a jury of their
peers.
Please contact your senators to keep President Clinton from giving away our
individual rights under our Constitution, and pray that it is not too late.

written by Margaret Mabbutt
Black Blade
CPI up +0.6%
http://www.quicken.com/investments/cbswatch/market_snapshot/?column=P0DSTOn the economic front, the consumer price index rose 0.6 percent overall compared to expectations for a 0.4 percent rise. Excluding the volatile food and energy components, the CPI rose by an as-expected 0.2 percent. View Economic Preview, economic calendar and forecasts and historical economic data.

In the fixed-income arena, prices traded lower in response to the CPI. The 10-year Treasury note shed 1/32 to yield 6.15 percent while the 30-year bond slipped 2/32 to yield 5.925 percent.

SHIFTY
Tamzarian
Your question :What's your go0ld gonna be worth?

Answer: I don't own " goOLD"

If you mean GOLD , it will be worth plenty. How else could the resistance be funded!

$hifty
Tamzarian
Shifty
Thanks for corecting my spelling of "goOld", however I do believe you know what I meant.

Moving rapidly along, the point is gold will be confiscated (i.e. you will be forced to sell it at the Rothscild-determined-price!). Now if you hold out (i.e. break the law), I agree it will become just as valueable as the Black Market dictates). But Sir, let me assure you with no reservations, THE MAJORITY WILL FALL INTO LINE!!!


Christopher
Tamzarian
Damn the majority, full speed ahead.

SHIFTY
Tamzarian
We will see about that if and when the time comes.

Freedom is never Free!

$hifty
Tamzarian
Shifty
Ah yes, I've heard it many times before 'cuz everybody's comfortable in their big paddeed armchairs, secured in their fortresses of arrogance. From these chairs brave and gallant words flow (because you don't have to confront a conflict - no pressure on you).

Resistance is futile - YOU WILL BE ASSIMILATED - end of story.
SHIFTY
Tamzarian
The way I see it : Everyone Dies of somthing.
In matters of principal, STAND LIKE A ROCK !
$hifty
Tamzarian
SHIFTY
Agreed - but when it comes to death, those who will standfastly claim to defy & contront it, will cower like puppy dogs before their MASTER.
Henri
Tamzarian
There is a common phallacy of those who seek to exert power over individuals. The perception is that there is no limit to their potential power.

The illusion of potential (potentate) power exists as long as those who would subjugate themselves to it derive benefit from the association.

The truth is that such potential power can never be exercised in actuality without consuming the source of its own existance. In the case of Clinton's executive order structure, its authority exists outside the parameters of constitutional law. Since Clinton has sworn to uphold the Constitution of the United States as the supreme law of the land, any move to subvert it reduces the credibility of the standing administration. In short any administration that gives penal or legal authority to a foreign entity without the consent of the people becomes effectively irrelevent. In principle, this turnover is incompatible with an armed populace. In fact, it could only suceed with a disarmed populous and a dismissal of Congress.

The common fate of such despotism, is historically intact. It rarely outlives the perpetrator. When sucessful, such power must be wielded with restraint. The source of the power is fear of the governed.

It is a new and untested concept to impose such powers upon a populous that have the acknowleged right to choose how they will be governed.

When there is fear, there is potentate power. When that power is exercised, fear is no longer a viable option. It is then a certainty that such power will be levied upon those most vocally opposed to it.

The tighter the grip of tyranny, the more the potentate power slips through the fingers.

The common bond of today's democratically induced bureaucracy is a worthless piece of fiat paper. When pursuit of such chits of fantasy cease, so will the fear of the potentate. This will be the ruin of this despotic power structure and hopefully the rebirth of the American Republic. This can be accomplished without bloodshed. The alternative, although unthinkable, is not without precedant.

From your ranting, I must place you in the camp of those who have already surrendered their individual rights and hope only to stir a different variety of fear. The cause of freedom is not stimulated by fear of tyranny. It springs from the will of the people to be in charge of their own destiny. The common sovereign, understands this.

When the script of life becomes well defined, interest in the pursuit of life wanes. There are those that surrender to this and those that choose by free will alone to adopt a different perspective. For these sovereigns, life is an unfolding adventure. We are constantly amazed at those who follow the script.


TheStranger
#33584
Quote - (oh - didn't you know that the Rothschilds control the price of gold and silver, which causes me to ponder why you
intellects go through the psuedo-exercize of this forum, believing that commodities "move on their own", unimpeded by
scheister-families of certain origin)

The above reference was made by a fellow who has posted his views here about Jews once before. I find this sort of thing beneath the standards of the forum, both morally and intellectually.
USAGOLD
Tuesdays with the Gold Broker
http://www.usagold.com/Order_Form.html7/18/00 Indications
�Current
�Change
Gold August Comex
283.30
-0.90
Silver July Comex
5.07
+0.01
30 Yr TBond Sept CBOT
97~09
-0~08
Dollar Index June NYBOT
108.44
-0.01


(7/18/00) www.USAGOLD.com Tuesdays with the Gold Broker:
Well, I always thought it slightly amusing that the baby boomer
president, Bill Clinton, would be the first president to face
impeachment since Richard Nixon, the hated symbol of everything
that was wrong with American back in the late 1960s and early
1970s, and everything that was going to be swept aside in the New
Culture. At least that's the way a certain large group of
idealists (in which the Clintons probably included themselves) saw
it. A new book will be hitting the bookstores today titled
"American Rhapsody" by Joe Eszterhas which basically drags Bill
Clinton ("the first rock-and-roll president" as he calls him)
through the dusty streets of modern Babylon: What you see, if this
morning's book review is to be relied upon, ain't necessarily
pretty, but then again, he gives Clinton about the same treatment
Richard Nixon received twenty-five years ago. (Ed. Note: All, we
have come to learn, is fair in love, war, politics and book
publishing.). . . . . . . .Eszterhas, alluding to the 60s
generation, frames the Clinton impeachment like this: "We were a
counterculture, an America within Amerika, arrogant,
self-righteous, even jingoistic about our values, heroes and
music. 'I Can't Get No Satisfaction' was our 'Battle Hymn of the
Republic'. . .Woodstock our D-day; Dylan our Elvis. . .We did not
have 'our' Richard Nixon. It was a shared faith among us that our
generation, committed to letting it all hang out, to the truth
setting us free, would never produce a Richard Nixon, a president
who would look us in the eye, jab a finger in our face and lie. .
.". . . . . . . . . .Of course, that is precisely what boomer Bill
Clinton did when asked that infamous day about having sex "with
that woman." From there Eszterhas goes on to skewer just about
everybody who's anybody on both sides of the rickety, broken down
political fence in both Washington and Hollywood. I'm sure he'll
sell a lot of books. . . . . . . . . . . . . . . . . . .Public
Service Company of Colorado is seeking a Public Utility Commission
rate hike of over 5% to keep up, it says, with the cost of
building new gas delivery infrastructure. . . . . . . . . . . .
.Gold is quiet today but Centennial Precious Metals/USAGOLD
experienced one of its biggest days yesterday since the mid-last
year. . . . . Sometimes there's not the wisp of rhyme or reason
for what motivates gold buyers. . . . . . . .Inflation seems to be
what's on people's mind these days. The government can quote
whatever inflation rate they like but the gas pumps and grocery
store cash registers don't lie. "GasPumpReality" has done more for
the gold market than the accumulated wisdom and analysis of all
the gold commentators writing today . . To be sure,investors also
like the bargain basement gold price and are engaged in long term
purchase programs. Several have said that they hope the price
stays down so they can continue building their reserves at a
favorable rate. . . . . . . . Speaking of inflation: Consumer
prices rose .6% in June matching the same increase in the
wholesale sector reported last week. Question from the Gold
Broker: How long until we get into double digits and the word
"Inflation" shows up in the front page headlines . . . . . . . . .
. . . . .Speaking of which Reuters reports this morning that
"World oil markets were thrown into new confusion on Tuesday after
OPEC headquarters said prices had fallen below the cartel's $28
threshold for releasing extra crude.". . . . . . . . . . . Oil is
up this morning. . . . .Stocks are down on the CPI and oil. . . .
. . . . . According to a CNN/USATODAY poll: Bush 48%; Gore 43%.
According to a CBS poll: Bush 43%; Gore 41%. According to the
American Public: Yawn 50%; Falling Asleep 50%. A Dead Heat in a
Hot Summer with Apathy Clutching to 100% of the Vote. . . . . . .
. . . . That's it for this week's Tuesday with the Gold Broker. .
. . .Have a good day, fellow goldmeisters.

An Invitation:

I would like to invite those who take an interest in the type of
analysis read here to give our newsletter a try -- News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals. This month we focus on oil and inflation. Many
analysts and investors think there very well may have been a
fundamental shift in economy that could favor the gold market and
hammer the equities and dollar market. These opinions from various
sources are covered in some detail in the upcoming July issue.
Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The package is
offered at no cost or obligation. You can call Marie at
1-800-869-5115 to request the newsletter and Almanac or
click above.
SHIFTY
CRB
Bridge CRB Index 225.39 +3.3 +1.48 %

$hifty
Cavan Man
Stranger's 33595
I share Stranger's concern. This fellow is evidently a polemicist (sp?)and someone who thrives upon confrontation in addition to being what appears to be a race baiter and, a good candidate for a suite at the "Hotel Silly". There are more appropriate venues for this sort of analysis.

Methinks it is time for a housecleaning.
Henri
Cavan Man, Stranger
Yup, hey, maybe Tamzarian IS Clinton.
ORO
Breakfast just got more expensive
Your cereal and coffee just took off.

Coffee is up 16% today.

Sugar is up nearly 4% today.

Grains are up an average of 1% today.

Watch for a breakout in the CRB indexes this week. In non-dollar terms the prices of most commodities are up substantially.

Tamzarian
Henri
Note: Do not associate "capital letters" with yelling, or ranting, or, raving, or anything inciduous; I merely want to easily differentiate Henri's writings from mine - I'm hope this Forum won't mind.

Henri writes: "There is a common phallacy of those who seek to exert power over individuals. The perception is that there is no limit to their potential power." - MANY OF THE WORLD'S PEOPLE CANNOT EVEN FEED THEMSELVES, AND/OR ARE NOT ALLOWED (TPTB I.E. UN)to attempt to feed themselves.

Henri writes: "The illusion of potential (potentate) power exists as long as those who would subjugate themselves to it derive benefit from the association." - DO YOU MEAN LIKE THE RUSSIANS WHO WERE CONTROLLED BY STALIN? WOULD YOU EXPLAIN THE BENEFIT THEY SAW?

Henri writes: "The truth is that such potential power can never be exercised in actuality without consuming the source of its own existance." - AGREED, IT'S THE PERIOD OF SUFFERING OF WHICH THE MASSES MUST ENDURE.

Henri writes: "In the case of Clinton's executive order structure, its authority exists outside the parameters of constitutional law." - AND HOW MANY SUCH ORDERS HAVE BEEN WRITTEN THROUGHOUT US HISTORY WITHOUT BEING CHALLENGED ~ 300? - ANY TREND HERE?

Henri writes: "Since Clinton has sworn to uphold the Constitution of the United States as the supreme law of the land, any move to subvert it reduces the credibility of the standing administration. In short any administration that gives penal or legal authority to a foreign entity without the consent of the people becomes effectively irrelevent. In principle, this turnover is incompatible with an armed populace. In fact, it could only suceed with a disarmed populous and a dismissal of Congress." YES, NOW HERE'S A PIP OF A STATEMENT - CLINTON WITH PRINCIPLES & CREDIBILITY, US CONGRESS WITH PRINCIPALS & CREDIBILITY, AND ANY AMERICAN INSTITUTION OF AUTHORITY WITH PRINCIPLES & CREDIBILITY.

Henri writes: "The common fate of such despotism, is historically intact. It rarely outlives the perpetrator. When sucessful, such power must be wielded with restraint. The source of the power is fear of the governed." - THE LENGTH OF TIME IT LIVES, AND ACCORDINGLY THE LENGTH OF TIME IT INCIDIOUSLY DRAWS OTHERS TO JOIN THEM, DETERMINES THE OVERALL QUANTITY AND "QUALITY" OF HUMAN SUFFERING.

Henri writes: "It is a new and untested concept to impose such powers upon a populous that have the acknowleged right to choose how they will be governed." - I DON'T KNOW ABOUT NEW OR UNTESTEDE, BUT I ASSURE YOU, THE CURRENT POPULATION DOES NOT HAVE THE RIGHT TO CHOOSE, SINCE IN MOST MULTI-PARTY SYSTEMS ALL SIDES ARE CONTROLLED, BY THE SAME POWERS THAT BE. IT'S ALL JUST A SHAM. REMEMBER "WE CONTROL THE VERTICAL, WE CONTROL THE HORIZONTAL, PLEASE DO NOT ADJUST YOUR THINKING."

Henri writes: "When there is fear, there is potentate power. When that power is exercised, fear is no longer a viable option. It is then a certainty that such power will be levied upon those most vocally opposed to it." - IN OTHER WORDS, THE SYSTEM PERPETUATES ITSELF BY PAYING OFF PEOPLE TO JOIN, AND HENCE PROLONG THE TYRANNY.

Henri writes: "The tighter the grip of tyranny, the more the potentate power slips through the fingers." - THE DECAY TIME IS VARIABLE - HOW LONG DID IT TAKE FOR THE ROMAN EMPIRE TO COLLAPSE (500 YRS+?), HOW ABOUT GHENGIS KHANS', AND RUSSIAS'? MEANWHILE, WAS THE POPULACE ENAMOURED WITH THESE EMPIRES - ONLY THE BOYS AT THE TOP!

Henri writes: "The common bond of today's democratically induced bureaucracy is a worthless piece of fiat paper. When pursuit of such chits of fantasy cease, so will the fear of the potentate. This will be the ruin of this despotic power structure and hopefully the rebirth of the American Republic. This can be accomplished without bloodshed. The alternative, although unthinkable, is not without precedant." - YOUR LAST SENTENCE IS NOT CONSISTENT WITH YOUR 2ND LAST SENTENCE.

Henri writes: "From your ranting, I must place you in the camp of those who have already surrendered their individual rights and hope only to stir a different variety of fear. The cause of freedom is not stimulated by fear of tyranny. It springs from the will of the people to be in charge of their own destiny. The common sovereign, understands this." - I DO N0T ATTEMPT TO STIR UP FEAR, RACISM, HATRED, OR ANY OTHER CONVENIENT POPULAR PHRASEOLOGY OR EUPHAMISMS WITH WHICH SEVERLY BIASED PEOPLE TRY TO LABEL ME - THERE IS ONLY A VERY SMALL PORTION OF THE POPULATION THAT ACTUALLY VISIT THESE TYPES OF SITES. HENCE, IF YOU WANT TO ELIMINATE THE TYRANNY, YOU MUST SPREAD THE WORD IN AS MANY PLACES AS POSSIBLE.

FOR UNRESTRAINED POWER, LOOK UP FEMA.

Henri writes: "When the script of life becomes well defined, interest in the pursuit of life wanes. There are those that surrender to this and those that choose by free will alone to adopt a different perspective. For these sovereigns, life is an unfolding adventure. We are constantly amazed at those who follow the script." - WE ARE CONSTANTLY AMAZED AT THESE SOVEREIGNS FOR PERMITTING THE SCRIPT TO CONTINUE!
SHIFTY
Baby Ray
I would like to ask a favor of my friends at this forum.
I have a nephew 10 days old. He was taken to the hospital last night. They are doing tests.If he has meningitis he has a 50/50 chance.
My sister was told she could not have children, and this little guy was a miracle. Now I fear he needs one!
I would like to ask for a few prayers!
Thank you
$hifty
Christopher
Tamzarian and masters
I have but one Master, one Lord, and he has told me that he is coming back for me one day. I look forward to that day. He also told me to not be afraid of those who can destroy my body, but be afraid of those who can destroy my soul.
...Though I walk through the valley of the shadow of death...

For those of you who don't rest as easy, well He will take care of you also, if you let him.

Christopher
Christopher
Shifty and Baby Ray
Done, my friend.

Christopher
Tamzarian
Cavan Man
..writes: "I share Stranger's concern. This fellow is evidently a polemicist (sp?)and someone who thrives upon confrontation in addition to being what appears to be a race baiter and, a good candidate for a suite at the "Hotel Silly". There are more appropriate venues for this sort of analysis.

Methinks it is time for a housecleaning."

As a child, I remember getting very frustrated and "huffing off in a tizzy", when I couldn't put forth a proper arguement. I always thought in these instances, "Wouldn't it be nice if they just went away so I could retreat to my nice, cozy, unadultered world.

You Sir, wouldn't make Round 1 in a high-school debate, and I with all sincerity, advise giving up your pursuit of law.

Cavan Man - .. Your Honor, this is patently ridiculous, I move you dismiss the case on the grounds that I am incapable of a proper debate.

Judge - Motion granted on the basis that I thought I saw some other support for this motion. In the future Tamzarian, don't come back until you learn to fall in line with the "current thinking". I know it changes from day to day, just like economic theory - one day you're right and the next day everybody hates you - but you'll have to learn to be flexible. Now case dismissed, and get out of here.

Now, instead of making categorically generalized statements, with absolutely no backing, refrain from commenting on that which you know not. If you can show that I'm full of pooh pooh, I'll gladly apologize to this Forumm for my mistakes. If you're going to make a generalized popular remark - they're a dime a dozen, and carry no meaningful information except as to the nature of the remarker, then don't. Clear and fair enough?

Buena Fe
Baby Ray
Father, may your will be done on earth, specifically relating to Baby Ray's health, as it would be done in heaven! In Jesus Name and our covenant of His Blood!
Thank You Lord
Henri
Michael
Just received my "Uro's". They are in breathtakingly good condition. Thanks! double clink!
Topaz
(No Subject)
It's 3am,- kids just arrived home complete with thunderous entry,- Dad's awake and theres no chance of resuming repose soo:-
Shifty:- Thoughts are with you.
ORO:- Seen the latest growth estimates out of Asia?
Now, I don't think our Eastern cousins are going to be satisfied with paper Gold this time round, do you?
Tamzarian:- Welcome, I must agree with Henri, they're much more frightened of us than we are of them No?
Also give the Jew thing a rest- Most-all posters/lurkers here are up to speed with whats going on and it'd be a shame to lose your (what promise to be) valuable contributions OK!
HI - HAT
ORO________CRB.........Where rubber meets the road
CRB.......Set up for classic Too much world-wide Fiat money demanding only so much available raw commodities. Just like Kennedy's "rising tide lifts all boats", the runaway printing press filters out purchasing power to every nook and crany.

Cable TV on in many hovels all over the world. They don't have paved roads, but they want what they see on that TV.

I've long thought that all this hot Fiat was going to explode the CRB. Bad money driving up the cost of real "wealth".
Tamzarian
Topaz
Look, if everyone must know, my Mother was a Pole (who was slave labor in a German concentration camp, who got the &*%$# beat out of her every day because she was incapable of doing the work of two men), and my Father was a Polish soldier. This is stated not to illicit pity or sympathy, for at least my parents made it through compared to Others (Jews, Gypsies, Slavs Liths, etc.), its stated to show in all probability, that I'm not a Nazi!

I'm going to clarify this once and for all - I don't give a sheit about Jews, Blacks, Germans, Indians, and the list goes on.

If "something" is being manipulated by a certain sect of people (I don't care who they are), or a country (I don't care which it is), why is it so blaspemous to make it known; we should be instigating reprisals (how, I don't know, that's why I came here), instead of whining about certain peole always being targetted.

As I am new to this Forum, I was not aware, as you stated, that "it is known" (i.e. manipulation) what's going on. Accordingly, I CEASE, as it has all been stated. So I "Why ponder the gold market, when its outcome is un-naturally controlled - loaded dice?"

Topaz
Tamzarian
My sympathies go to you and yours.
But consider this- The manipulation of which you speak is not necessarily orchestrated by one group alone. Admittedly, the "usual suspects" are getting all the bad press but imho this runs a lot deeper than JUST Rothchild, Goldman et al, No?
Topaz
Furthermore...
...rather than sit back and cop it sweet, the best and only course of action I and probably you Tamzarian can take is to acquire and take possession of Physical Bullion on a regular basis.

They just HATE that!
schippi
POG Chart
http://www.SelectSectors.com/pog.gif POG Chart with linear & nonlinear 5day forecast.
Linear forecast Down
Nonlinear forecast Up
Both in different directions. No problem,
Just choose the one you like.
Peter Asher
Mad Poster runnung amok
Tamzarian When you say " the manipulators of Gold are from
"Families of a certain origin", and then say "If "something" is being manipulated by a certain sect of people, ----- why is it so blasphemous to make it known; we should be instigating
reprisals (how, I don't know, that's why I came here),


You appear to be saying that the Sect of Jews as a people, are manipulating Gold and we (whoever that may be in your demented universe) should be instigating reprisals against them. Were you thinking of ovens or gas chambers this time???

Topaz
schippichart
Please may I have some of the non-linear Sir?

Shaken but not stirred svp!
Journeyman
Anti-semitism

I am not anti-semitic -- or anti !Kung, anti-Russian, etc. or anything I'm aware of except possibly anti-statist. In fact, there are alot of things I admire about the Jewish culture. There are a few things I don't particularly like too, however.

I must admire the effectiveness of B'nai Brith and The Anti Defamation League in stifiling all sorts of discussions involving those labeled "Jews," and how careful everyone is not to say anything "negative" about them. It's against the law in Germany and some other countries even to be a "holocaust doubter," and folks are even now serving prison time for questioning the official figures of how many were actually immolated, and how many of those weren't "Jewish." Why not make it against the law to be a "fiat doubter?"

Actually, I lied. I am anti-Semitic. I don't think I am, but by ADL & B'nai Brith standards, I am. Why? Because I'm critical of foreign aid to Israel. Of course, I'm critical of "foreign aid" money, extorted from American "taxpayers" and sent to any country, but as it turns out, I'm even MORE critical of aid to Israel. Why? Because Israel gets more total U.S. government foreign aid than any other country in the world. THIS notion in particular, that Israel gets too much foreign aid, according to their standards, puts me on their official "anti-semitic" list!!

So be it.

Regards,
Journeyman
wolavka
dec gold
so you couldn't break the 292 resistance, Okay how about tonite on globex we dip to 288 then we go up and take out 298 tomorrow.

Gold is going higher tomorrow. 7-19
Cavan Man
Journeyman
At one time Israel was #1 and Egypt, #2. There was actually a bread subsidization program in Egypt financed by the US aid.
Journeyman
Euro intro speeded up

Looks like the following is the official PR/propaganda extension of the Euro introduction speed-up reported at USAGOLD a short time ago. What's REALLY behind the speed-up?

with EU-Economy<

AP Photos Available<

By PAUL AMES=

Associated Press Writer=

BRUSSELS, Belgium (AP) _ Preparations for the final replacement of
national currencies with the euro in 2002 must be speeded up so
businesses and consumers are ready for the changeover, euro-zone
finance ministers agreed Monday.

``We cannot start to prepare for the switch the week before,'' said
French Finance Minister Laurent Fabius.

``There has been a certain slackening off and we need to get this back
on track.''

Ministers are particularly concerned small businesses are failing to
prepare for the currency swap which will see francs, marks, pesetas
and the rest replaced by 14 billion euro bank notes and 50 billion new
coins.

``We need to go on an awareness offensive,'' said Austrian Finance
Minister Karl-Heinz Grasser. ``We need to need to get out of the virtual

reality we have today and make the euro part of daily life.''

The euro was adopted as the common currency of 11 EU nations on
Jan. 1, 1999, as a non-cash currency used mainly in finance markets,
government agencies and big business.

Euro cash will be launched on New Year's Day 2002, with a transition
period of up to six months when national currencies will remain legal
tender alongside the new money.

Ministers stressed that businesses had to be aware they would have to
switch their accounting, tax returns and most transactions into the new
currency from day one, and not wait until national currency disappears
altogether.

``Jan. 1, 2002 is an end date, not a start date,'' said Charlie
McCreevy,
the Irish minister.

In a report presented to the ministers, the European Commission said
just 3 percent of euro-zone citizens have made payments in the new
currency and only 30 percent knew they could already do so with their
credit cards or euro-denominated checks.

Fabius said just one transaction in every 1,000 across the 11-nation
euro-zone was carried out in the new currency. ``We have to move
from the abstract to the concrete,'' he said.

Pedro Solbes, the EU economics affairs commissioner, praised France,
Belgium and Luxembourg as being most advanced it their
preparations. He singled out a French decision to insist all public
contracts stretching beyond 2001 must be in euros.

Other ministers stressed their initiatives to increase readiness.

Portuguese Finance Minister Joaquim Pina Moura said Portuguese tax
authorities were switching to euros and his government was promoting
information campaigns in schools; McCreevy said Irish authorities were
distributing a copy of the national changeover plan to every household
in the republic.

Karl Diller, Germany's state finance secretary, said his government was
launching an intensive information campaign for small businesses;
Spanish Economic Minister Rodrigo Rato said his government was
focussing on retailers and the elderly.

Fabius acknowledged the difficulties of familiarizing citizens with a
currency that does not yet exist.

``It's like learning to dance without music or a partners,'' he said. To

help overcome such problems, France has made currency swap the
main subject a special finance ministers' meeting scheduled for Sept.
9-10 in the French city of Versailles.

RossL
Currencies flatlining vs. SDR
http://home.columbus.rr.com/rossl/gold.htm
There were big swings in the major currencies last Thursday, but they have essentially flatlined since then. Any theories as to what is going on?
TownCrier
A sneak peek to let you get a jump on the others while the world sleeps...
http://www.usagold.com/onlinestore/special.htmlIts been a concerted effort to put this together, but here it is at long last...a pair of coins minted many years ago of Scandinavian gold that you can almost picture being transported at one time or another across the cold grey Baltic Sea or the choppy North Sea aboard a long Viking ship in ages long gone by.View Yesterday's Discussion.

Topaz
Dear Mr Goldman...
http://www.kitco.com/gold.graph.htmlIt would most definitely appear that:-
"Other interests" stand ready to purchase increasingly large amounts of paper gold should the price drop. (to $281ish)

The US$ is over the odds and you can't crack 280au.
SDR- Who cares anymore - we've got the Euro.
Theres a good chap, take the bin out as you leave... Oh... and...ah... dont come Monday!
ORO
Aristotle - comments, installment 5 - and for HBM
Note: Re Aristotle (07/10/00; 17:56:21MT - usagold.com msg#: 33342) - FOA withdrawal

Aristotle, FOA did indeed put it together in a wonderful summary at the time. More concise and sharp than anything I ever read on the topic of international monetary economics and politics.

Aristotle (07/01/00; 19:28:55MT - usagold.com msg#: 33086)
Aristotle (6/15/2000; 19:09:20MT - usagold.com msg#: 32406)
Hill Billy Mitchell (6/15/2000; 15:47:40MT - usagold.com msg#: 32398)
http://www.usagold.com/hall/hallfame2.html#anchor286557

HBM, Aristotle:

The central role of gold in the financial markets is not unalloyed. To give myself as an example, I put nearly as much, and on occasion more, into antique etched crystal, artworks, and turn of the century antique furniture than I do into gold and silver, as a percentage of income. The point of the matter is the joy of ownership of items directly useful that are both beautiful and of some rarity. These items also have a much more liquid market today than they had in the past due to the rise of the internet. Prices are much more predictable, and antique retailer's margins are now squeezed and come more from appreciation of inventory (price inflation) than from the margin between buy and sell prices.

The store of value function of the rare item is kin to that of gold, but less effective because of the limited liquidity and the differences between items. Gold is highly liquid and much more mobile. It is not subject to destruction, and is spendable internationally at uniform prices.

In the taking of income "off the table" into true savings, the funds put into the rarities and gold (and other PMs) are not at risk. They are not in fiduciary obligations subject to default, and they are not in a running business that is likely subject to swings in the market and political climate for the whole of its value. The rarities have intrinsic value that is far less susceptible to changes that have potential to make a running business worthless, to cause default on fiduciary media (turning them worthless), or to changes that cause currency collapses that destroy the purchasing power of non-defaulted fiduciary media and equity in surviving businesses. The value of a debt security and a bank account are subject to the vagaries of default and currency inflation. The value of equities is only that of the future income they can produce; the income potential may evaporate due to competitive products produced at lower cost, regulatory interference, etc..

Financial and business assets have a potential value of 0. The rarities are unlikely to face such demise, and their potential value on the downside is much more than 0.

There is now the question of physical savings vs. investment. So long as investments give their holders the impression of allowing them to obtain the items of savings in the future, the straightforward investors are likely to maintain their current low conversion rate from investment to physical savings. The temptation to continue with a recent peak performer is great, even when the fundamentals have been depleted as drivers for the future value of the investment. The straightforward investor is a momentum investor, he can be described by the investment decision equation:
Income rate + capital appreciation rate => Market interest
R(t) + [P(t) / P(t-1) -1] => Im
So long as the relationship holds, he is inclined to keeping his positions.
The momentum investor is backward looking.

The momentum investor is also delaying movement into physical savings so long as the prices of physical savings vehicles (PS) answer to the relationship:
PS(t)/PS(t-1) - 1 <= Im

For the sophisticated investor, the speculation of continued momentum is questionable, and is investigated at length. According to the sophisticate's view, he will hedge against momentum performers and diversify away from them.

The "old money" politically savvy, economically aware, and connected "players" are those who move towards the physical savings vehicles at a steady rate. Their family financial history stands as an education that indoctrinates them with the realities of economics as revealed by this history. They take a longer view of capital and see savings as separate from investment. They save over periods of decades rather than years, and take funds "off the table" on a continuing basis as they understand the dangers of political - economic situations as they build. What understanding that is missing is provided by hired intelligence that they pay for very well (some of the payment is for the purpose of preventing these advisors from revealing their views in public).

To these people, monetary volumes are seen as sources of potential competition to their own physical savings plan, and they do their best to both prevent competitors from access to these items and to prevent their knowledge of them. Often they will use all their influence to squeeze the savings vehicles out of reluctant private, public, and corporate hands. The declining gold reserves of bullion banks have moved into these hands. They are in positions that allow them to push governments to use their power to sway markets in their favor. As Another said; the price is low because someone very important is buying.

This latter class of investor will accumulate in secret, and will be unlikely to reveal their view of markets even to political leaders in their employ, nor to otherwise trusted business and personal confederates. They do not view capital in monetary terms, and refrain from calculating returns in these units. They view true accumulation of productive capital in its own terms, just as they view savings in terms of gold and rarities. The accumulation of productive capital is viewed as a net addition to the sum of competitive and profitable operations in their control (not necessarily under their direct ownership). These are the people that will take true business profits off the table and save them in physical form.

The nominal return on their investments is not a first concern, but the accumulation of actual capital. Often, they will lend to a "bad risk" in order to obtain the security put up for the loan. These are the owners of loans to miners when resource prices are low and the miner seems destined for bankruptcy, and Moody's or SP put up a warning on their debt. The loan is not intended to float the business, but to secure the transfer of ownership to the creditor without a competitive bidding process that would reveal the player's opinion of the business' value.

The capital return on capital is not revealed in nominal profit margins and not benchmarked to nominal interest rates. It is seen in mining, for example, in the accumulation of mine reserves and capital equipment. It is revealed in accumulation of square footage of high value real estate, maquiladora plants in Mexico, and chunks of Daewoo. The preferred method of acquisition is purchase during distressed sale when the market price of the business acquired is very low, or when it is possible to avoid the open market altogether.

The repossessed business, if it were the one that over invested in up to date new capacity would not necessarily be profitable at first, but the ability to wait out the competition that is at a disadvantage because it is still servicing debt, while the repossessed bankrupt can reorganize and produce without being hampered by the capital debt load weighing on competitors, will eventually win it market share and profit margins.

When considered in this way, the routine capital return on capital is on the order of 1.5%-3% in mature businesses, as the capital is consumed by use and needs to be updated to remain competitive in either product quality or cost. The bulk of capital expenditure fills maintenance and updating needs, not the need for new capacity. The capital return on capital is often higher for new industries. However, during an investment boom, capital is often consumed as new generations of products and services that involved a smaller initial investment drive out prior competitors who had invested heavily in earlier generation technology that has become worthless when the new technology came online.

Microsoft is the greatest example of this trend, as the markets continuously inject capital into Microsoft through the buying of ESOP share distributions by its employees. The R&D efforts of Microsoft are greater than its revenue, and have been so for years. The markets absorb this excess cost through the purchase of the stock granted to employees instead of salaries, and used by the corporation in its acquisitions instead of cash. The reality of Microsoft's monopoly is that it costs more to maintain than the market is worth. It is only the belief of the momentum investors in the value of Microsoft's monopoly that makes it possible for Microsoft to operate. This belief of investors is supported by the accounting standards that hide the cost of ESOPs that move the expense of R&D from Microsoft's books to the new investors in its stock. While investors are unwilling to foot costs for warehouse and inventory building by Amazon.com (the bulk of its investment) because it appears on its accounts and makes their earnings disappear, they are happy to do so for companies who's main expense is in R&D labor; particularly genomic and software companies. The main reason for this situation is the inability of the investor to understand the product, identify its market, or estimate the value of having the advantage of first to market, nor the barriers to entry for competitors.

Back to the issue of net profit in "real" terms.

In FOA's version of the "Western Investor", the equation describing the momentum investor is applicable. There is an expectation that plenty will be available for the future and one need only wait and invest in one of the momentum financial vehicles and then reap the rewards and convert them into savings. Thus 4-5% of capital gains are spent rather converted to savings. Many recognize the problem of currency inflation, but do not understand that the process that brings substantial price rises/currency depreciation occurs AFTER the excess currency is produced. The understanding that the new currency adding fuel to inflationary fires is actually being produced by central banks because of deflationary pressures that threaten systemic collapse due to default of banking is beyond most "Western" investor's comprehension.
The ingrained thought is that the "too much money" that is "chasing too few goods" is concurrently being produced. That has never been the case. Only 1/4 to 1/2 of new currency is "chasing goods" the rest chases other paper, settles in debt mutual funds and bank CDs etc.. In these financial forms, debt money accumulates and collects interest and/or capital appreciation.

Just as holders of junk internet stocks were holding them and chasing others despite clear evidence that market valuations were not only unrelated to potential earnings, but that some stocks were trading at multiples of the expected size of the market being sought by the company. Within a few weeks, the internet currency depreciated by 30-40% for the BEST companies. The lesser corporations are now providing their investors with nearly a complete loss of investment. The same structure is built into the debt currency and the financial vehicles that substitute for it. The senseless expectation of further capital appreciation based on the previous experience is identical to the expectation of currency and substitute holders having similar purchasing power to that at the time of earning the funds, if a sufficiently high interest rate is obtained. Since interest rate levels reflect that same expectation, it is only AFTER a breakout of "price inflation" that interest rates reflect the PAST currency inflation.

The suddenness of the currency depreciation catches the unaware by surprise. The spirit of it as a substitute for a bank panic is lost on the "Western" or momentum investor. The fact of currency inflation being a default by banking, government or a country's society as a whole is not in this investor's frame of reference.

The more careful investor I termed "sophisticated" still refrains from exercising his full judgment in diversifying into real assets because of the army of "experts" (a.k.a. financial sales reps) saying that what the investor needs to hedge against currency depreciation is "leverage" to the price of gold or to the one or many commodities who's prices threaten his purchasing power. The fact of these instruments being identical in their nature as fiduciary media to currency and its substitutes is lost on this investor. That they can only be free from default if infinite amounts of currency are potentially made available by the central bank is also disregarded here.

Now comes the point of the "old money" and "smart" saver that take resources out of investments and put them in physical savings over decades. Being free from the illusions of extrapolation from the immediate past, and having an understanding of the nature of currency depreciation as an outright default of a fiduciary media, these investors buy gold. They do not wait for market signals and the like. They make their move constantly. Some may use influence and judgment to secure credible gold obligations from gold mines to substitute for immediate delivery for the purpose of allowing lower long term gold prices. Each of these "giants" is capable of moving the markets if he were to attempt a shorter term strategy of "market timing" of his accumulation. He, and others like him, will do their best to HIDE the purchases - quite unlike the momentum investor who is happy to "pump" his current holding (even if he has no intention of actually "dumping").

This is the "player" that is accumulating his 1-3% of capital every year in actual gold, in land, in the extremely rare art and well crafted antiques. This is the core of participants in international trade, and the core of capital ownership that seeks an actual return of physical assets from their business. These are the individuals and families that do trade and business on a grand scale. The public corporations in which many retain stakes are only part of the picture. The bulk of their holdings are private and do not go public unless the markets are willing to provide substantially more than they think the company is "worth". UPS was private until just recently, as was Goldman Sachs. The owners are cashing out.


Apropos stocks:

Remember that net individual sales/purchases of stock outside of mutual funds show a sell rate of $587 billion annually. If you add to the $166 billion of individual's funds flowing into mutual funds about 1/2 or 2/3 that amount that go into particular stocks, then you have a group selling at a rate of some $700 billion per year. Large companies buying back their own stock provided $150+ billion, M&A provided somewhat less in cash, mutual funds and individual purchases come to $250 billion, and the balance is coming from abroad at $188 billion with the pension funds netting near 0 or selling, for a total of $700 billion.

A recent Business Week survey of the top corporations across the globe revealed that the average dividend yield around the globe is 1.5%-2%, the effective rate which cover Japanese bank costs in lending short term and the best Japanese government bond yield. The core driver of the global equity bubble is the attempt by Japan to keep its banking system afloat while keeping the Yen currency viable. They exported the monetary base inflation that was created to address the need to reflate the banks through carry trades and by inducing foreign direct investment of the trade surplus generated by their corporations. Though the 0 rate policy is a response to internal problems in Japan, it has played a major role in maintaining the value of the dollar. This was the case till their trade surplus, which provided non-Japanese dollar holders with something to buy with dollars outside the US, became too small to cover the US trade deficit's doubling and now near tripling. The crossover beyond coverage of the US trade deficit came in 1998 as the carry trades began unraveling.

The noises about the end of the Japanese 0 interest policy threaten the whole of the global equity markets, which are priced according to that figure. It also impacts the gold market, as the suspected POG derivative at its center reacts to interest rates of particular G-7 central banks so as to proportion the POG to the lowest interest rate available from central bank participants in the supposed agreement according to an apparent application of a Black Scholes pricing model (more on the model's economic meaning in an upcoming post I have been holding back for a few weeks). The model actually prices the currency in terms of gold in the form of what usually seems to be a 5 year futures contract. The currency bearing the lowest interest rate dictates the rest of the currency values according to supply and demand from actual investment, debt payment, and trade flows. The lowest interest rate makes the country providing it the main source of capital for the global banking network. The outcome is that during active fund flows, POG is roughly proportional to (1+Imin) ^ n, where Imin is the lowest G-7 interest rate, and n is the common maturity for the particular nation's common bond maturity, usually 5 years. The result is a POG that rises with interest rates during the period covered by the alleged agreement. The effect is to have a country that has low interest rates, and therefore infuses capital to the world to be rewarded with a low POG in general, and in its currency in particular.

WAC (Wide Awake Club)
@HI-HAT -- Paved Roads
So right. In my part of the world, there is no piped water supply, no sewage etc. But that satellite dish is stuck to the wall, and of course the crumbling mercedes is parked outside.
wolavka
correction
good support in dec gold @ 287.60
SALMON
@Tamzarian

Bardzo interesujace i prowokacyne tematy pan porusza jak na dzisiejsze czasy.
Czytalem je z interesowaniem i bylem bardzo ciekawy jaka bedzie Forum reakcja.
Chcialbym uslyszec nieco wiecej.

Dziekuje

S*
USAGOLD
Forum Business
The Mermaid Coin Offer_________________________

I would like to express by thanks for the indulgence and support of our Table members during these gold coin offerings, after all USAGOLD/Centennial Precious Metals is not operating under a government subsidy and must depend upon a profit for sustenance and maintenance, including these pages. That is why we include the invocation wherever possible to "Remember that it is your purchase of gold from USAGOLD/Centennial Precious Metals that norishes these pages." I was surprised at how fast the Uruguayan coin sold out last month. We were cautioned by some not to waste time actually offering anything for sale on the internet, that people don't really buy on line, etc. We took account of the nay-sayers and essentially said "It's at least worth a try." Little did we know how successful we would be. Much of the credit goes to our own Towncrier, Randy Strauss, who not only does the behind the technical work to make it happen, he also applies his great research and writing skills to tell the story behind the coins and the economic history that goes along with it. The system is easy to use, functions like a Swiss watch, and, as those of you who have used it would attest, comprises an interesting new approach to the world of gold commerce.

Those planning on purchasing this somewhat scarcer item (The Danish Mermaid gold coin) would be well advised to move early on as we do have single clients capable of purchasing the entire issue should they decide to do so, or any portion thereof, and we wouldn't discourage them from buying whatever number of coins they saw fit. In this case, the coins are catalogued at roughly double the offering price. This does not mean that you would get that price should you go to sell the coin at your local coin dealer's establishment, but it does mean that an independent third party has valued the coin at a substantially higher than what we are willing to sell it for. We go to a good deal of trouble to find items of historical interest that are properly priced for these offerings. We hope that you in turn not only get a sense of value from your assemblage of these items but a sense of comfort from knowing that something of great value lies safely esconced in your safe deposit box. We believe these gold coins will not only fulfill the pride of ownership criteria for our clientele, we believe they will serve as a barrier against the currency depreciation so many feel is sure to come.

Oro, as he so often does, skillfully argues the case for ownership of an item like the Mermaid when he says:

"In the taking of income "off the table" into true savings, the funds put into the rarities and gold (and other PMs) are not at risk. They are not in fiduciary obligations subject to default, and they are not in a running business that is likely subject to swings in the market and political climate for the whole of its value. The rarities have intrinsic value that is far less susceptible to changes that have potential to make a running business worthless, to cause default on fiduciary media (turning them worthless), or to changes that cause currency collapses that destroy the purchasing power of non-defaulted fiduciary media and
equity in surviving businesses. The value of a debt security and a bank account are subject to the vagaries of default and currency inflation. The value of equities is only that of the future income they can produce; the income potential may evaporate due to competitive products produced at lower cost, regulatory interference, etc."

That is about as effective and succinct a case as I have ever seen for gold assets. My compliments, Oro.

We want to thank all of our clients who have supported these efforts.
Henri
Mermaids
Just ordered a couple "mermaids". I like the idea of owning some because of the sales pitch about the vikings. My ancestors have been traced to Danish mercenary night fighters sent by the Danish King to aid William the Conquerer in 1060. Can't clink 'til I get them.
wolavka
took out stops
watch gold move. dec dipped , now headed higher
SALMON
U.S. trade deficit

"The U.S. trade deficit rose to a record $31 billion in May, the government reported Wednesday, a shade higher than Wall Street forecasts and above April's revised gap of $30.5 billion." - CNN reports

That is just enough to push dollar higher!?
Black Blade
Morning Wakeup Call! PMs in (tactical?) retreat at NY open!
Source: Bridge NewsAsia Precious Metals Review: Spot platinum falls on TOCOM

By Mari Iwata and Polly Yam in Hong Kong, BridgeNews Tokyo--July 19--The price of spot platinum fell in Asia on Wednesday in response to the decline on the platinum futures of Japan's Tokyo Commodity Exchange (TOCOM), dealers said. Spot gold, however, traded at about $282 per ounce for much of the Asian trading due to unclear price direction, they said.

Black Blade: TOCOM�..yawn!

Johannesburg--July 18--More than 60 workers downed tools at Impala Platinum Refineries in Springs, east of Johannesburg, on Tuesday morning to protest against unfair labour practices at the plant, the South African Press Association reported. National Union of Mineworkers branch chairman Joseph Nxumalo said workers were angered by the decision to reinstate two white employees who had contravened company regulations, while black employees who committed similar offences were dismissed. (Story .13479)

Black Blade: more PGM pressure.

Meanwhile, looks like a very ugly start on the PM markets, Au down -$3.40, Ag down -$0.05, Pt and Pd down -$8.00. Oil up +$0.07 at 32.03/bbl. S&P futures down -4.10, fair value +1.26, still looks like a lower open on Wall Street. Going to grab a six-pack and watch the carnage/PM bargains. Danish, hmmmm��, Why not!
Perplexed
ANARCHY
Tamzarian If you think that you are the only person on the forum aware of what is traspiring with government, I would suggest, as a new poster, you spend some time in the archives with the thought of getting acquainted with some of the personalities you are on the verge of slandering. You will find few of us in need of being awakened.

Polls contrived to produce a desired outcome, has become a constant activity of government, especially as it relates to gun ownership. The result of these rigged polls are
creating a very false assumption of the true state of mind of the American people by those supposedly "in charge, " and evidently by some not so in charge.

Reinforcing Henri's point : THE CONSTITUTION IS THE SUPREME LAW OF THE LAND, AND FURNISHES THE BASIS OF ALL GOVERNMENT POWER. FROM THE MOMENT OF ITS SUSPENSION, A STATE OF ANARCHY BEGINS. WE BECOME A NATION WITHOUT LAWFUL GOVERNMENT, AND ALL BETS ARE OFF. ALL DECISIONS WILL BE REMOVED FROM THE PURVIEW OF LAWYERS AND JUDGES, AND WILL REST UPON THE RESOLVE OF THE PEOPLE WITH GUNS.

WITH THE SUSPENSION OF THE CONSTITUTION, THE GOVERNMENT BECOMES THE AGGRESSOR; THE LAW AND CURRENCY MANIPULATORS ARE FACED WITH AN ALL OR NOTHING SCENARIO, AND FOR SOME VERY HIGHLY PLACED POLITICIANS, RESOLUTION BECOMES LITERALY A LIFE AND DEATH PROPOSITION.

The Declaration of Independence states that the just powers of government derive from the consent of the governed, but the only way this is now possible is by armed conflict.
As we know from current events, this is what "our democracy" thrives on. Now suffering exactly the same fate James Madison had described for all democracies, IT IS
COMMITING " SUICIDE BY CORRUPTION," RIGHT BEFORE OUR EYES, AND WITHOUT OUR HELP. AT THE PRESENT TIME IT DOESN�T
NEED A PUSH, AND WE DON�T NEED ANOTHER FORT SUMPTER! SO KEEP YOUR GUNS IN THE CLOSET.

The nation is not in trouble, the government is the entity in jeopardy, and is being held together by one thing, a strong stock market. Since the crisis management team was
created to keep the stock market from crashing in 1987, the government has been riding the back of the tiger. We have known for at least the last 20 years that this nation could
be plunged into economic chaos at anytime the money manipulators choose, now it's the world, AND THEY CAN�T AFFORD CHAOS, OR THEY WOULDN�T BE TRYING SO HARD TO
MAINTAIN THE STATUS QUO.

While creative work created the wealth--creative law, incited by creative politicians, owned by creative financiers employing creative bookkeeping, coercive law enforcement, and brain washing, has pulled off the greatest scam the world has ever seen. Lawyers, by manipulating the laws and currency, have, on paper, secured ownership of most of the wealth on earth. They screwed up however and inadvertently created a doomsday machine.

Just as this thing started going together, as you may recall, President Johnson made the statement that " We have set in motion, forces which no one understands". He was right. The machine is now concentrating the wealth so rapidly, that it is threatening to suck the vast majority
of the purchasing power out of the world economy.
By hiding inflation, (the difference between the amount of taxes collected, and the total required to finance each years government expense), in the form of debt, the interest machine is destroying every government on earth. When commerce, the source of the seemingly inexhaustible river
of money ceases to function, even for a short period of time, the river runs dry, and the interest machine continues to eat up government, business, and personal revenue. This
eventually exposes the lie of inflation being under control.

The support Bill Clinton enjoys is based upon the fear of disturbing any element of the government structure lest the whole thing collapse, and the apprehension is fully justified.

There is only one way in which any part of this nations economy can be salvaged, and that is by printing, thus devaluing the currency, and cutting government expenditures to the bone, allowing repayment of vast debt with cheap money.

Because the debt hid the truth, workers around the globe, did not demand that their wages keep pace with the true
rate of inflation. If you want to know what inflation should look like, take a peek at current medical, legal,
and financial cost, these are government protected monopolies, and are the tools being used for the concentration of government power.

For too long the monetary structure has favored those reaping huge profits by the manipulation of the laws and currency, while intentionally "shorting" the money supply
to the physical work force, for the purpose of "fighting inflation".

There is something drastically wrong with a policy of intentionally fostering unemployment for the purpose of
"cooling" the economy to the benefit of those enjoying massive unearned wealth.

A policy that takes all the means of support from those individuals and families already suffering under the yoke
of inadequate resources, epitomizes the term asinine to the
extreme.

The major difference between the convoluted conditions now, and the those of Oct. 1929 is the enormous amount of wealth now compared to then, and its distribution. Today, wealth, (although encumbered by debt,) is represented by cars, boats, real estate, a standard of living, and above all a sense of entitlement to them, even among the "poor."
While the potential number of affected citizens has increased arithmetically, our level of patience has decreased exponentially. Translation: We are now faced with a larger bomb and a much shorter fuse. The few people who believe that these possessions and aspirations will be easily relinquished, are in for a very rude awakening.

There are now some very worried, super wealthy, power manipulators, who are contemplating the prospects of watching enormous wealth return to those who produced
it, as government organizations, purchased painstakingly over many years, disappear like a house of cards in a Texas twister, right along with a brothel full of prostitutes,
masquerading as "public servants."

STILL PERPLEXED
USAGOLD
Stronger Dollar, Gold Dip Incongruous with Record Trade Deficit
http://www.usagold.com/Order_Form.html7/19/00 Indications
�Current
�Change
Gold August Comex
279.50
-3.60
Silver July Comex
5.06
-0.03
30 Yr TBond Sept CBOT
96~28
-0~02
Dollar Index June NYBOT
109.25
+0.19


(7/18/00) www.USAGOLD.com . . . Gold sold off this morning
despite a government report revealing a trade deficit of $31
billion for May -- another record. Oil was the principle culprit
with the U.S. achieving the second worst trade imbalance with
oil-producers on record. As pointed out here last week, these
heavy oil imports at roughly $30 a barrel are sure to have their
inflationary consequences down the road and with the most recent
consumer price report flirting with double-digits at over 7%, one
wonders how long until double-digit inflation becomes the primary
force to be reckoned with in U.S. investment markets. If the
dollar is doing well, and some say that is why gold is down today,
one would have to assume it is because other governments and
central banks choose to attack their own currencies at these
levels to assist their export industries. Given the bad news for
the dollar that seems to crop up daily, this latest report on the
U.S. trade imbalance being just one example, one can be excused
for judging a dollar rally co-incident with such news a bit shaky,
and an incongruous $3.60 drop in the gold price as a bit
over-done.

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

An Invitation:

Most of you have already received the July News & Views:
Forecasts, Commentary & Analysis on the Economy and
Precious Metals, and we would like to thank you for the many
kind comments and questions we've received. Oil continues to be
the issue as this morning's report demonstrates. And oil and
inflation are what the July newsletter is all about. To answer the
most frequently asked question: "Yes, we believe that we are
moving into an inflationary economy and, yes, we believe it will
affect all markets including gold." This month's issue covers the
thinking of a number of highly regarded analysts on the subject
and we welcome those who don't receive News & Views now to request
it via our info packet order form.

Along with the latest issue of News & Views, you will receive our
Gold Almanac 2000 which offers fundamental background on the
yellow metal. The theme of this year's Almanac is wealth
preservation and one of the key articles is how those in the
1970s -- a decade many are comparing to the present -- not only
survived double digit inflation, but prospered. The packet is
offered at no cost or obligation.

You can call Marie at 1-800-869-5115 to request the
newsletter and Almanac or click above.
Buena Fe
Hoorah Perplexed!
"There are now some very worried, super wealthy, power manipulators, who are contemplating the prospects of watching enormous wealth return to those who produced
it, as government organizations, purchased painstakingly over many years, disappear like a house of cards in a Texas twister, right along with a brothel full of prostitutes,
masquerading as "public servants." "

You've just described what I believe are the soveriegnly perscribed coming events foretold by James the half brother of Jesus in his letter, chapter 5, verses 1-8. My bet is we will begin to see the manifestation of these events by the end of this month!

Speculations:
-days.....no peace over Jerusalem
-days.....G8 meeting brings changes to world monetary issues, positive gold/negative US$
-weeks.... US stock/bond/currency crash
-months (12-24) Russia + others iniate war against Isreal (Russia suffers stunning defeat)

Escatolgy is a hobby of mine you might say, no need to take these predictions to seriously.



CoBra(too)
Odd odds?
Just a short note on the US $, charging ahead against all odds and almost all currencies in view of ever deteriorating trade balances, financial asset inflation, now followed by commodities massively picking up vigor and only the POG being suppressed by the powers that be. For how long can this charade be perpetuated, or whom does this (mis-)administration think they're fooling a n d get away with it in an ever contracting world?
I feel these guys are juggling to many balls (not that they have any left,really!)up in thin air to make it to the elections. Time to pick up more m o n e y at basemnet bargain prices! Best cb2
TheStranger
John Law - Wall Street Journal Excerpt
July 19, 2000

How John Law's Failed Experiment
Gave Us a New Word: 'Millionaire'

In 18th-century France, the scarcity of gold impaired the country's ability to trade its surpluses with other nations. Many of the French enjoyed great affluence, yet they and the profligate government of Louis XIV always seemed to be scrounging for gold.

It was the great fortune of a man named John Law that he could introduce his ideas about paper money to the country. "My secret is to make gold out of paper," he once said. The result was famously lucrative and then even more famously catastrophic for the French, but Law's demonstration of the flexibility afforded by paper currency and by the creation of money by bank or government fiat has been the basis of finance ever since. His exploits gave the world a word it cherishes to this day: millionaire. The following excerpts from a new book by Cynthia Crossen about the amassing of great fortunes through the ages shows linkages between Law's epoch and our own.

***
Born in 1671, John Law grew up in Edinburgh, where his father was a goldsmith who lent money on the side. As a child, Law displayed an aptitude for arithmetic, geometry and algebra. When he was 13 years old, his father died, and his mother took over the family business. Law worked for the firm for three years, learning the principles of banking, and after work he studied tennis and fencing. Before he left to seek his fortune in London, he was described as "nicely expert in all manner of debaucheries."


From the book 'The Rich and How They Got That Way' by Cynthia Crossen. Copyright 2000 by Dow Jones & Co. Published by Crown Business, a division of Random House Inc.

In London, Law gambled, studied finance, and practiced what was then called "gallantry" -- all at considerable expense to his widowed mother. He was a good athlete, quick-witted, eloquent, and fastidious in dress. He was also a great favorite among women, who called him Beau Law. For reasons lost to history, Law began feuding with a man named Beau Wilson, another London dandy. The two arranged to fight a duel, which lasted only a few seconds: In Law's one pass, he fatally pierced Wilson's chest with his sword.

Because duels were assumed to be premeditated, Law was charged with murder and convicted. Imprisoned while awaiting a public hanging, he escaped. For the next 10 years, Law drifted around the Continent, supporting himself by gambling. In Venice, Genoa and Amsterdam, he also studied fledgling banking companies. His mathematical mind was persistently reflecting on the intricacies of high finance.

At Europe's many gambling houses -- Paris alone had more than 60 at the time -- Law became known as an expert at calculating mathematical odds. Eventually, he was winning so much money that he commissioned the casting of a large gold coin to facilitate the handling of his stakes. He began to travel around in a polished coach attended by men in livery. Charming and wealthy, Law was able to get letters of introduction to the drawing rooms of powerful Europeans. At one home in Paris, he met the Duke of Orleans, who a few years later became regent of France.

Law learned the most about banking and finance in Holland, where the Bank of Amsterdam was already 100 years old. In Law's time, the bank primarily handled transfers -- merchants brought coins to the bank and received credit for their value in the form of banknotes. Because the bank simply transferred money among accounts, under normal circumstances it wouldn't be caught short of metal reserves.

***
In the early 1700s, Law continued moving among the Continent's big cities, gambling for his living. In 1715, he and the woman he lived with moved to Paris, where Louis XIV had recently died. Louis had passed France to his five-year-old great-grandson, Louis XV, whose regent, the Duke of Orleans, was Law's friend.


John Law (above), once described as 'nicely expert in all manner of debaucheries,' became an expert at calculating mathematical odds by frequenting Europe's many gambling houses.

In Paris at the time, wealth was seen as an unalloyed good, and the wealthy pampered themselves with grotesque and silly magnificence. The mistress of a rich nobleman wanted to exceed the legendary Lucullus, who swallowed a diamond worth 100,000 francs, so she ate a bill worth 500,000 francs. While some of the wealthy were children of the landed aristocracy, others made their fortunes by milking the national treasury.

Louis XIV had been living on loans for years, borrowing from his subjects and issuing worthless paper that went by different names to promote confusion. In the last 14 years of his reign, Louis XIV had spent two billion livres more than he had collected in taxes. The coinage had been so debased that it was almost worthless. Tens of thousands of workers were unemployed, and agriculture was in distress. Trade was almost at a standstill.

Law believed he could fix France with his "system." He began by proposing a bank that would issue notes and hold and transfer deposits, much as the Bank of Amsterdam did. As an incentive to the government to endorse his bank, Law would sell shares of the new bank for a combination of cash and government securities, which, although then trading at a deep discount, he would honor at face value.

In 1716, Law established a private bank called Law & Co. So sure was he of his system's promise that he invested his entire fortune in it and promised to give 500,000 livres to charity if the project failed.

Many others had tried to replace metal with paper, but it was difficult to persuade people they should exchange coins, which had a known value, for the promise of other coins in the future. Coinage everywhere was subject to sudden and arbitrary devaluation or augmentation, making its purchasing power somewhat hypothetical. But Law made a promise to the French people that their government hadn't: His notes were redeemable on demand for coin "of the weight and standard of the day of issue." That meant the value of the notes would be unaffected by future fluctuations in coinage.

Gradually trust in the bank began to build. In 1717, the notes were made receivable for taxes and other royal revenue. The following year, Law's bank became the state-royal-bank. One of the nationalized bank's first actions was to change the terms of its notes to be redeemable for "current coins" -- subjecting Law's notes to fluctuating values.

Law had become one of the most revered people in France -- he was a financial pied piper, and the nation danced to his music. He said what his audience wanted to hear: He could make them rich merely by printing paper.

In 1717, Law proposed establishing a company that would have the exclusive rights to trade with and exploit the resources of the Mississippi River, the Louisiana Territory and Canada's fur trade -- all under French control at the time. Another part of the scheme: Law would pay down some of the government's enormous debt from the company's profit.

Read an additional excerpt about Bill Gates from "The Rich and How They Got That Way."

The regent and Parliament approved the plan, and the Company of the West was established. Shares in the company sold slowly at first: For nearly two years, they could be bought below par. To attract public attention, Law declared that in six months he would "call" for a small number of shares of the company at par, even though the shares were then selling at about half of face value. Share prices began to rise.

Law's company gradually began to acquire other contracts for government business, occasionally issuing more shares to finance its acquisitions. It bought the tobacco monopoly in 1718, when consumption of tobacco was rapidly escalating. In 1719, the French government gave the company the right of coinage. John Law now controlled the mint, public finances, the bank, the sea trade and the Louisiana, tobacco, and salt revenues.

At the same time, Law was encouraging holders of government annuities -- whose debt financing was crippling the crown -- to exchange their instruments for shares in the company. He issued 200,000 shares of his company and again accepted discounted paper at face value. Several months later, he issued another 50,000 shares. All were snapped up enthusiastically, so Law issued still another 50,000 shares. Then, in September 1719, Law announced that he would buy the entire debt of France by issuing more shares of his company and basically swapping dividends. By the end of the year, he had sold 600,000 shares in the company.

To keep the share price rising, Law published exaggerated accounts of Louisiana's riches, mineral resources, and people. He created duchies, earldoms, and marquisates in Louisiana (and gave himself the duchy of Arkansas).

The reality, of course, was quite different. Much of the Mississippi valley was unconquered wilderness. But in Paris, no one knew this. The only thing the French knew with certainty was that prices of the company's shares would never stop climbing. Stock that had come on the market at 500 livres was selling for 10,000 livres. This price unnerved even Law himself, although he had become one of the richest men in the world. Meanwhile, the regent ordered more money printed. In one year, the supply of money almost doubled. Inflation soared.

In Paris, people of every class enjoyed the novelty of making a fortune while they slept. Rags became riches, and riches became inordinate riches. So many people were becoming rich that the French needed a new word to describe them, and millionaire was it.

In 1720, Law, the national hero, was appointed France's comptroller general of finances, making him the de facto prime minister. The day after he assumed office, shares of his company reached an all-time high. Using his trading profit, Law bought dozens of parcels of land and buildings in Paris, some 20 estates, jewels, a 45,000-volume library and a wine cellar.

Eventually, all financial fevers break. In Law's case, professional speculators began selling, but instead of accepting paper as payment they demanded coin. Law knew his bank would soon be depleted if this continued, but he also knew it would be suicidal not to honor his redemption promise. Share prices fell, and attempts to convert paper into gold or jewels accelerated.

At Law's urging, the government introduced a series of edicts aimed at forcing the public to use paper instead of metal. On Feb. 27, 1720, the government ordered that no person "of whatever estate or condition" should have more than 500 livres in coins or ingots. The authorities commenced so-called domiciliary visits, resulting in widespread confiscations. In the cellars of an ex-chancellor named Pontchartrain were found 57,000 gold coins. On March 11, the government announced that gold and silver could no longer be used to pay debts. This made France the first country in the civilized world where a commercial transaction couldn't be conducted with gold and silver.

The public was incensed. Law was given a detachment of Swiss Guards to protect him from enraged crowds. Once when his empty carriage was recognized on the street, an angry mob tore it to pieces. The windows of his house were smashed. Yet he still had the ear of the regent. He was, after all, the only person in the world who understood the system.

On May 21, the government issued the edict that broke the system. It devalued all the company's notes and shares and fixed their prices. The value of the company's shares was reduced by almost half. The public outcry was so vociferous that the edict was repealed a week after its publication, but the damage was done. Law submitted his resignation as comptroller general.

The rush on the bank was so great that it closed for 10 days; it opened again on June 10, but so many people tried to get in that some suffocated or were crushed to death. On July 17, the crowd arrived at the bank to find barricades around it. This so incited them that they rushed the barriers; 12 were killed, many others injured.

Meanwhile the price of food was rising, and shopkeepers would accept paper currency only at discounts as high as 90% and sometimes not at all. The government began to withdraw paper from circulation by announcing that all notes of 1,000 livres or more were canceled unless they were used to buy government annuities or for opening accounts at Law's bank. Another edict soon did the same for all other notes. A few months later, the use of gold and silver was resumed in all commercial transactions.

On Nov. 27, the bank closed its doors for the last time. John Law's experiment with paper money had lasted less than two years. He left France in December. All his property, except a small amount of cash he carried, was confiscated by the government. He returned to England, where he asked for and was granted a formal pardon for his 30-year-old murder conviction.

In 1725, Law moved to Venice, where he made a modest living by gambling. He died of pneumonia in a lodging house four years later at the age of 58. An inventory of his wealth noted 488 paintings, including works by Titian, Raphael, Michelangelo and Leonardo da Vinci. A satirical epitaph published in France after his death read, "Here lies that celebrated Scotsman, that peerless mathematician who, by the rules of algebra, sent France to the poorhouse."

John Law's experiment, like many experiments, was a failure, even a tragedy for some. But his ideas were like smoke from a bottle: Once out, they could not be put back. He had proved that the value of money is an agreement among people, not an objective standard measurable in nuggets or ingots, a distinction that fostered future stages of wealth creation.
*****
Stranger's Note: Funny, I would have said Law proved just the opposite. For other exciting articles about money and banking, please subscribe to the Wall Street Journal.
Cavan Man
$1 Billion per year in loans for Africa....
to help impoverished African countries acquire discounted medications from US drug manufacturers to combat the aids virus.

Question: Why not just give the US companies a big tax break for giving the meds away.

I think I know the answer.
Cavan Man
The Stranger and NEM
The recent weakness is giving me butterflies in the stomach.
Peter Asher
Perplexed and All

There was (To me) a profound line early on in "Patriot" that is so pertinent to our ongoing discussion of the failings of "Democracy" as opposed to the true freedoms that exist in a "Republic."

At the town meeting debating whether to declare for Independence, Gibson's character says: "I would rather be subject to one tyrant, three thousand miles away, then to three thousand tyrants one mile away."
Peter Asher
ORO (07/19/00; 02:48:29MT - usagold.com msg#: 33624)
Thank you for a true masterpiece on wealth and money. So much of what we have struggled to make clear here is neatly encapsulated in your single essay.

Oh yes, consider this a nomination to the Hall of fame.
Journeyman
Evidence of how "governments" keep us bamboozled
http://www.telegraph.co.uk:80/et?ac=000367623233545&rtmo=kNJeZk3p&atmo=99999999&pg=/et/00/7/9/nspin09.html
Ever think about the term "spin doctor" and the implications of governments using such an animal? Well here's an inside look - - - and it t'aint pretty.

This is imported from the UK Electronic Telegraph, an on-line version of the London Telegraph. There are more links to "spin" and how it's used included in the story, accessible from the link in the header of this message.

----

ISSUE 1871
Sunday 9 July 2000


Prescott's demand to Campbell: why are
our spin doctors failing?
By Joe Murphy Political Editor


ALASTAIR CAMPBELL, the Prime Minister's press secretary, has been
told to report each week to John Prescott on why the Downing Street spin
machine is failing to get its message across.

Leaked correspondence obtained by The Telegraph discloses that the Deputy
Prime Minister demanded in Cabinet a weekly inquest into why the
Government has lost its grip on the media. His intervention was seen by
ministers as a sign that Mr Prescott is infuriated by weeks of relentless
political disasters, with attempts to promote Government achievements being
ruined by leaks, in-fighting over Europe and outbursts by ministers.

Allies of Mr Prescott yesterday claimed that he will be taking charge of
Government co-ordination in future, on top of a new election role as linkman
between Labour Party members and ministers. In a six-page letter to him,
dated June 29, Mr Campbell wrote: "You raised in Cabinet the idea of
reviewing each week the extent to which we succeed in getting our agenda to
dominate the political and media debate. I will include them in these weekly
notes.

"Contrary to how it often feels, we do have a reasonable success rate in
getting our agenda up, but more so on a day to day basis than with the
consistency of strategic message that we are looking for. As you said, it is a
fact of life that sometimes events beyond our control will take over." Some
ministers interpreted Mr Prescott's intervention as the start of a turf war over
news management. In the past, the Deputy Prime Minister has derided "spin
doctors" and phrases such as "boom and bust".

Yesterday, Tony Blair appointed him to improve links between Labour's
grass-roots membership and the Government. Allies of Mr Prescott said that
his role as co-ordinator would allow him to discipline ministers who go
off-message. Both Mr Prescott and Mr Campbell denied that there was any
friction between them.

Insiders said that Mr Prescott's intention had not been to embarrass Mr
Campbell but to highlight the damage caused by ministers failing to stick to
their lines. Mr Campbell said yesterday that he and Mr Prescott worked "very
closely together". Mr Campbell is responsible for the weekly "grid" of
announcements that co-ordinates ministerial speeches. In his letter, Mr
Campbell listed the previous week's failures.

On the Tuesday, Mo Mowlam's remarks about the monarchy were the "main
political story", overshadowing a speech by Alan Milburn, the Health
Secretary. The row over petrol tax and a Peter Mandelson speech on voting
reform had "got in the way a fair bit" the next day, while Europe had then
become the big issue "not entirely as planned". Last night Tories repeated their
demand that Mr Campbell's �96,000 salary should be paid for by the Labour
Party rather than the taxpayer.

Mr Campbell said the criticism was ridiculous. "There may be people in the
media and the Conservative Party who find it difficult to accept, but my job is
to help the Prime Minister and his colleagues co-ordinate the Government's
message. The idea that my writing to ministers represents the politicisation of
the civil service is absurd."

Regards, J.
wolavka
okay now we close higher
stops gone , so now we can take it up.
Turnaround
2nd nomination

Peter Asher (07/19/00; 10:24:04MT - usagold.com msg#: 33641)
ORO (07/19/00; 02:48:29MT - usagold.com msg#: 33624)
"Thank you for a true masterpiece on wealth and money. So much of what we have struggled to make clear here is neatly encapsulated in your single essay.

Oh yes, consider this a nomination to the Hall of fame."

I'll second that.

Several more pieces fell into place ("grasped") this time
around. Reverse-engineering the last 20 years of gold prices would be
quite an accomplishment in and of itself. The prior dissertations on this matter
are clearer now.

Probably more than a few readers are compiling their own ORO libraries-
picking through the archives. Perhaps an ORO page, or at least an ORO pointer page
is indicated?

One difficult aspect for me is not having the data available for such things
as ["the offshore dollar debt is collapsing"] (paraphrasing) or following
capital flows, asset plundering operations, etc. This makes it difficult to argue the
case in front of others. Perhaps a book is forthcoming, otherwise some pointers (links)
would be useful.

*******

Re:
TheStranger (07/19/00; 09:53:44MT - usagold.com msg#: 33637)
John Law - Wall Street Journal Excerpt
July 19, 2000

(I think ORO posted this or another link to the same work a few days ago.)

http://www.bibliomania.com/NonFiction/Mackay/PopDelusions/

has a chapter on the South Seas Bubble (whence the term 'bubble') which the
above article may have drawn from. Another interesting aspect of the SSB:
It occurred about a decade after a new technology for mass communication was
deployed, similar to the broadcast radio of the 1920's. Perhaps the flush of its
newness and reach amplified the mania up and back.

*******

Journeyman (07/19/00; 10:39:44MT - usagold.com msg#: 33642)
Evidence of how "governments" keep us bamboozled
http://www.telegraph.co.uk:80/et?ac=000367623233545&rtmo=kNJeZk3p&atmo=99999999&pg=/et/00/7/9/nspin09.html

"Ever think about the term "spin doctor" and the implications of governments using such an animal? Well here's an inside look - - - and it t'aint pretty."

What is so fascinating about this period is the look behind the scenes that the infighting
gives us. I think as things get rowdier a lot more identifiable hands, elbows and other body parts
will become apparent. Oh, and praise be the internet. ;-)


fastinfo
Lawsuit against Nesbitt Burns Canadian Brooker

Recours en justice contre Nesbitt Burns � Legal Action against Nesbitt Burns

Si vous croyez avoir �t� mal inform� (mauvaise gestion de votre portefeuille et/ou fausse information) concernant vos placements chez Nesbitt Burns, courtier en valeurs mobili�res au Canada, nous vous conseillons d�agir le plus rapidement possible afin d��viter les d�lais de prescription.

Les plaintes concernent en particulier les placements suivants: SEMAFO (SMF), SUNDUST (SUN), MERCANTILE (MPT.U), CANUC RESOURCES (CANC), TIOMIN (TIO), PENGIA (PGD) ou tout autre entreprise d�explorations mini�res et p�troli�res.

Le bureau concern� est : Nesbitt Burns Laval

Plusieurs investisseurs ont d�j� port� plainte � la bourse de Montr�al et � la commission des valeurs mobili�res.

Plusieurs investisseurs ont d�j� obtenu un r�glement avec Nesbitt Burns, d�autres sont sur le point d��tre r�gl�s ou iront en justice pour obtenir satisfaction.

Si vous croyez avoir �t� mal inform� par votre courtier nous vous sugg�rons de contacter le plus rapidement possible votre avocat ou de faire appel � cet avocat ( Ma"tre Hugo R. Martin,
Tel : 514 878 1900, E-Mail : martin@megalegal.com) pour un recours en justice avec un groupe de personnes.

Information :

Jugement rendu en cours supr�me pour une affaire similaire (fran�ais)

http://www.lexum.umontreal.ca/csc-scc/cgi-bin/repere.cgi?corpus=pub_fr&tout=Placements+Armand+Laflame⟨uage=fr&form=csc-scc%2Ffr%2Findex.html⦥=1#doc=190


If you think you have been misinform by Nesbitt Burns � Canada, wrong information concerning your portfolio or the companies you did invest, we highly suggest you to put legal action against Nesbitt Burns before court deadline.

Complains concern mainly investment with these companies: SEMAFO (SMF), SUNDUST (SUN), MERCANTILE (MPT.U), CANUC RESOURCES (CANC), TIOMIN (TIO), PENGIA (PGD) or any other company involve in gold mine or oil.

Concern this office: Nesbitt Burns Laval

A few investors already had a settlement with Nesbitt Burns, other are still waiting for a settlement or will put legal action.
If you think you have been misinform by Nesbitt Burns you should call your lawyer ASAP or this lawyer and join others plaintiffs: ( Ma"tre Hugo R. Martin, Tel : 514 878 1900, E-Mail : martin@megalegal.com)

Judgement that was made on high court for a similar case

http://www.lexum.umontreal.ca/csc-scc/en/rec/html/laflamme.en.html


CoBra(too)
@fastinfo - re Nesbitt Burns
Misinformation on gold mining and oil and gas co's - as it seems mostly juniors - is IMHO a very subjective challenge and as I feel not the root of the problem ( If it would have been (dis-)information on a fraudulent co. - say, like BreX -where NB's mining analysts may have had more than a (vested?) interest - it would be a totally different kettle of tea. Though not knowing the intrinsics, I feel in this context the perpetrators are in much more elevated places, than Nesbitt or its analysts.

The role of the ESF (Exchange Stabilization Fund) and/or the (few) officials behind this secretive fund as well as the President's financial task force (founded after Oct. 87 and dubbed Plunge Protection Team soon thereafter), having a stated and vested interest to keep up a lastly "fraudulent" monetary system to the benefit of few and the detriment of all - including, as Harry Schultz postulates to the detriment of honesty and lastly liberty.
So let us please not get detracted by lastly minor offenders - as severe as they may be - and have the cabalistic thieves of your personal freedom get away unchallenged.

Sorry - I'm not Larry Parks - only your humble cb2



CoBra(too)
Hello Stranger - re John Law
Thanks for reposting some of WSJ's article on John law - I've been tickled by his becoming a -probably negative celebrity in Paris gaming hoses - by his mathematical calculation of odds.
Well, Las Vegas has probably hired a new bunch of mathematicians - btw. so had LTCM, even an Nobel Price Winner and a Goldman merry weather bond trader - in the end to no avail - ecxept this Titanic was not allowed to sink - the system -, nor was Tiger... so teh system is still waiting for the iceberg - is it the 100 plus trillion in derivatives - disguised as hedges - against which or what counterparties? - considering the annual global (real) gdp is a mere 30% of this submerged beast.

As Greenspan, at least according, to his latest speech is aware of systemic risks, inherent in any fiat system, especially in one spanning the world, which may have grossly overextended its wellcome outside of the US - notwithstanding the benefits of todays wealth effect for exporting countries - though, again grossly distorting the "labor" of the not so blessed, reminds me rebuilding of feudal systems by these, formerly audaciously repelling the by the same. The only difference is in the means, which thanks to ORO's brilliant coinage of seignority in (global)reserve currency leads to the same ends.

And BTW, I would too like to second Oro's latest to the HOF.

Best cb2

PS: DD - Thanks for latest response - hope to meet up with you some time, or to say it with some o'da friends - you da man!




CoBra(too)
sorry for allthe typos in last post -
Mea culpa - too many to repost - tsk ... cb2
Aristotle
I love it!
Quick word--pressed for time.
Paper gold dropping as I expected it would at this time (Jul-Aug) -- leading to the ultimate separation of ways with physical. Will explain why later, but most of you already know.

If it ain't metal, you ain't got none.

Gold. Get you some. ---Aristotle
CoBra(too)
Was just about to pack it in ...
Read F*s surrender on POG... and Ari's assurance of paper gold separating from reality i.e. physical ...

To reword an old favorite: If you've gambled for matchsticks
or gambled for 'love' ...and if you haven't "gambled" for gold, you haven't gambled at all - so true - you don't need to. cb2
Cavan Man
CB2
Never fall in love with cars, women or houses. Should we add gold to the list? One must have some sort of secular affectation; oui ou non?

The Philharmonic is my favorite coin.
Cavan Man
Sir Aristotle (good Knight)
Well, we'll sure be looking for your next post.

Signed,

A gambling fool
CoBra(too)
CM - your 33651
Is on all counts prophetic - let's see about the final prophecy - stocking up - and good (k)night to you too, even if if was not directed to... cb2
Gandalf the White
ORO (07/19/00; 02:48:29MT - usagold.com msg#: 33624
ATTENTION -- TowniePeter Asher said in (07/19/00; 10:24:04MT - usagold.com msg#: 33641)
"Oh yes, consider this a nomination to the Hall of fame."

********Townie -- Please consider this the required THIRD second of ORO's #33641 for the Hall of Fame. <;-)>>
The Hobbits love to read SIR ORO's thoughts s-l-o-w-l-y.
=====
#1 Second --Turnaround (07/19/00; 12:51:01MT - usagold.com msg#: 33644)
(PA said,) "Oh yes, consider this a nomination to the Hall of fame."
Turaround said "I'll second that."
====
#2 Second -- CoBra(too) (07/19/00; 15:19:11MT - usagold.com msg#: 33647)
"And BTW, I would too like to second Oro's latest to the HOF."
====



TownCrier
Sir Gandalf the White....duly noted, and thank you.
http://www.usagold.com/onlinestore/special.htmlYou are the very model of efficiency and proper protocol, making this extra iron in the fire somewhat easier to tend.

Very much appreciated!

Have you shown the hobbit children the latest treasure from what would surely be Professor Tolkien's Icebay of Forochel region?
Gandalf the White
Townie's Question
YES, I have shown them the Viking Au and now they are counting they paper Presidents to see if they can rescue some of their ancestor's monies. -- Tempus Fugit!!
Thanks TC.
<;-)
Journeyman
The good life?

- The U.S is having an "anger epidemic" according to researchers. They suggest this is the result of not enough free time and pressures to "lead the material good life." -CNN HLN, July 18, 2000, 5:37:44 PM

People don't have enough free time because, as a direct result of increasing taxes --- remember the budget surplus -- two people now have to work, one to support the family, the other to support the government. And even that's not enough, so now overtime is necessary. Personal bankruptcies are at an all-time high, and even people who "are doing well" are living on their credit cards. Is this the good life?

Regards,
Journeyman
Cavan Man
Another (no pun) positive perspective on the Euro
http://www.polyconomics.com/searchbase/07-13-00.htmlWorth a read I think. There is something else at work that the markets do not currently see.
elevator guy
@Journeyman
It seems as if TPTB decided that the average American was having too much time off, and so they tipped the scales of financial neccessity through taxes and inflation, so that the average American would have to work longer hours, plus the spouse, just to stay alive. And then we are baited with the lure of material goods, to keep us thirsty for the water that only the fiat currency can provide. A self-supporting addiction, to keep the masses married to their greed, and serving the fiat god.
TownCrier
U.S. INTERNATIONAL TRADE IN GOODS AND SERVICES--May 2000
http://www.bea.doc.gov/bea/newsrel/trad0500.htmThe U.S. Department of Commerce announced today that the U.S. trade deficit rose by a half-billion dollars over the April deficit to $31.0 billion in May. Although total value of imports fell by 0.3 billion dollars, the wider deficit was caused by an even greater decrease in our export values, which fell by 0.8 billion.

Items of note:
The May quantity of imported crude oil (297 million barrels) was the highest amount since 300 million barrels were imported in August 1998. As a riminder, last month the dollar value of imports was down by $0.2 billion thanks to April's brief decline in crude prices to $24.42 per barrel (down from $26.38 in March) following nine months of rises. That same "helpful" phenomenon was at work again this time as the price of crude oil used in the calculations dipped in May to $24.16 a barrel from the $24.42 value used the previous month. This contrasts markedly with the May 1999 level of $14.60 a barrel.

Despite the price per barrel drop in May, the U.S. deficit with oil-producing nations vaulted by 17.8 percent to the second-highest level on record.... $4.1 billion. Accordingly, the subsequent imports from OPEC also reached the second-highest level on record at $5.4 billion.

With the WTO decision in the wings, our much watched deficit with China still rose 8.1 percent to $6.3 billion even as exports to China increased the the highest level since October 1998 at $1.5 billion. This is a positive indicator of growing economic strength in China which will surely help boost gold as that market is on track to be liberalised next year in that land of the sleeping giant.

Speaking of economic strength, cash is flowing to the so-called newly industrialized countries (such as Taiwan, Korea, and Hong Kong) as imports from them to the U.S. reached a record $9 billion.

From seasonally adjusted figures, exports of nonmonetary gold in April and May returned to levels closer to their historic norm from the recent six-month span of lofty shipments. In May, U.S. gold exports were approximately 22 tonnes, down from 27 tonnes in April....(whereas March was near 74 tonnes. Are we running low on supply to give?).

Year-to-date figures for 2000 now reveal that $2.894 billion in gold has been exported, whereas during this same time last year only $1.198 billion had left U.S. ownership--well over double the previous value.

U.S. imports of nonmonetary gold were nearly even with April at about 19.5 tonnes. (Tonnage approximations based on $10 per gram.) Year-to-date U.S. gold imports for this year are running at $1.252 billion imported, slightly less than last year's comparable figure of $1.282 billion.

Statistical note: Because U.S. Census Bureau data includes only gold that passes under the purview of Customs, the Commerce Department's Bureau of Economic Analysis adjusts these gold figures to arrive at more suitable accounting for balance of payments to reflect static changes in ownership "in line with the concepts and definitions used to prepare the international and national accounts." To that end, exports are adjusted for gold that is purchased by foreign official agencies from U.S. dealers and held at the Federal Reserve Bank of New York, and similarly, import figures are adjusted to reflect gold sold by such foreign agencies from their stock held at the FRB of NY.
TownCrier
The ECB, COMEX, India
Yesterday's weekly financial statement by the European Central Bank revealed yet another half billion euro decline in the value of euro-system holdings of foreign exchange reverses. I saw no mention of any changes to their level of gold assets, and presume them to be unchanged.

In COMEX action today, the estimated volume of gold futures traded was 31,000, whereas the total August futures traded yesterday was 17,000 contracts.

The World Gold Council indicates that the favorable monsoon season in India is expected to result in a five to ten percent increase in that nation's gold consumption over the previous year. 1999 weighed in at 853 tonnes imported.
TownCrier
Yes...
I CAN spell "reminder" properly when I REALLY want to.
Cavan Man
An earlier perspective.....
......on Europe and America....

"France was a land, England was a people, but America, having about it still that quality of the idea, was harder to utter- it was the graves of Shiloh and the tired, drawn nervous faces of its great men, and the country boys dying in the Argonne for a phrase that was empty before their bodies withered- it was a willingness of heart".

"The Crack-Up"
F. Scott Fitzgerald

This "willingness of heart" exists in most of our countrymen. May God Bless those who carry the flame.
Cavan Man
Hello Townie
Good to see you posting again. I thought I'd provide some filler until the big guns come back 'round. Hope you don't mind.
tedw
Trade Deficit
http://www.usagold.comWhat does the trade deficit mean?

I got part of economics education in the 4th Grade in the 1950's. Mrs.Burns,our fouth grade teacher, told us that a consistent ongoing trade deficit was the sign of a declining civilization.

Back then the United States was doing pretty good. Not so now.

Ask yourself how long you could export your wealth overseas and still be viable.

More money out versus less money in spells trouble somewhere down the road.

Is that too simplistic?
canamami
Haphazard Musings - Why the POG can't rally
1. The POG can't rally until there is a run on the dollar.

2. There cannot be a run on the dollar until holders of dollar-denominated debt start dumping that debt at firesale prices.

3. There is a surplus in Washington because there is no consensus on how to "spend" the "surplus" (Congress wants tax cuts, President wants social programs).

4. Because there is no consensus, the "surplus" is used to retire dollar-denominated government debt.

5. Those most inclined to dump at firesale prices need not do so, because they can sell to the government, as the government retires the debt.

6. Thus, as long as the political deadlock precludes a consensus on how to "spend" the "surplus", the POG cannnot rally, provided the surplus is large enough to absorb the dollar-denominated debt of would-be dumpees.
Marius
Elevator Guy post # 33660
Call me paranoid, but I would add that both parents working makes child care services more necessary. This is desirable to the State--get children away from parents at the earliest possible age. Regulate day care to make its cost prohibitive, and parents will demand more government involvement, perhaps eventually leading to government-run day care. A win/win situation for the State.

M
schippi
Gold Indexes Chart
http://www.SelectSectors.com/gldindx.gif Gold Indexes ( XAU, GOX, HUI, FSAGX)
FSAGX broke below it's mild Uptrend today.
( Not a good sign )
The POG 5 day forecast is also Down
http://www.SelectSectors.com/pog.gif

Todays closing NAV for FSAGX closed below
all Wavelet components today.
http://www.SelectSectors.com/wavelet.gif
Black Blade
@Perplexed msg. 33683
You wrote,

There are now some very worried, super wealthy, power manipulators, who are contemplating the prospects of watching enormous wealth return to those who produced
it, as government organizations, purchased painstakingly over many years, disappear like a house of cards in a Texas twister, right along with a brothel full of prostitutes,
masquerading as "public servants."

Now good sir, why would you want to slander prostitutes like that? ;-) I've got a lot more respect for prostitutes than politicians. When you pay a prostitute, you expect to get......, Politicians do it irregardless. Of course, prostitution is quite legal where I live.

Journeyman
A confirmation @ORO

Hi ORO!

You suggested in a post a few days ago that we check out foreign owned buildings, etc. Well, in my small town, we don't have any --- however you may find the following at least qualitatively interesting:

- More foreign companies are getting themselves listed on the NYSE. The total of new listings last year was 26. Twenty-three have been listed already this year. One of the reasons so many foreign companies are getting listed here in the U.S. is that they are buying U.S. companies. -Bob Pisani from NYSE, CNBC, Wednesday, 19 July, 2000, 7:01:38 PM

Regards,
J.
SHIFTY
baby Ray
http://users.sisna.com/thairanch/eagleranch/BabyRay.JPGChristopher, Buena Fe, Topaz, all : I want to thank every one for the prayers for baby Ray. My sister tells me he was looking a bit better today.The link above ( Thank you Thaigold ) has a few photo's of baby Ray.
He was born on July 8 , 2000 . Again I cant thank you all enough for the prayers.

$hifty
Chris Powell
Help GATA as it returns to Congress for answers
http://www.egroups.com/message/gata/508?We've got a couple of specific
questions that we think can break
the gold price manpulation.


To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
send an email to:

gata-subscribe@eGroups.com
elevator guy
@Marius
Thats a chilling scenario, boss.

Do you remember the "telescreen" in George Orwell's "1984", where the main character called Winston knew that the TV not only told him what to think, but measured his responses to the spin and b.s.????

That part of the book came back to me, as I watched CNN, and the anchor encouraged the viewers to go on line, and express their feelings on some issue.

This is the age of deception, and the media is king. They swing the vote, and make the politicians. They bump off anyone who dares contradict them.

Like now Hilliary, under accusation of calling someone a F.J.B., is calling the campaign manager for Bill a drunk, deluded mis-fit, who was removed from the Arkansas bar. Well, thats funny, the press doesn't even mention that this man was the campaign manager because he was hand-picked by Bill for his shrewdness, and media/business savvy. But when the accusation against Hilliary comes out, all of a sudden that campaign manager is some sort of psyko pond scum. Yeah, right, we cant see through that defense. The media is used to rub out enemies. Period. Its a war of b's', and whoever has the media in their pocket wins, hands down.

What really amazes me is that their seem to be so few people who are aware of this deliberate manipulation of the minds of Americans. And to think that some Americans are so dumb, that they fall for this blatant crap!! Come on now, we cant all be mushrooms, can we? Certainly there are those out there with intelligence, and convictions? Who elected that guy, anyhow? What happened to Ross Perot?

I'll tell you my prediction-- Here it is...

Bush is already "selected" to be the next President. Look at the unlikely run-off competition he had in that little ferret, whats his name? He was just a prop, so the public would choose the pre-selected candidate. They have him make a few glaring social/political blunders, and then you are left looking at Bush like he is the lesser of two evils, and then you have made the pre-programmed choice. The Democratic party is not even a consideration, because its not their "turn" to have a President in the White House. (We must keep up the appearances of two viable parties, with signifigant idealogical differences, that constantly war against each other, and take turns at the reigns of power, you know) Imagine a soft drink company, that touts two mame brand sodas. Much is spent on advertising, and getting consumers in one camp or another. No real difference, but it is important to the bottler that you drink one or the other, and not water.

In the US, it doesnt matter which party you belong to, because they both put the citicens in debt to the banksters, by either social programs, (look at the poor souls on the street), or by defense spending (Those commies across the ocean want to anihilate us)
Gandalf the White
INFLATION in the land of smiles ?
July 20, 2000
Bangkok Post
OIL PRICES / MORE INCREASES ON THE WAY
Petrol to top 16 baht this week, pressure on cooking gas, power. -- Traders resent subsidy fund
by Yuthana Praiwan

The pump price of petrol is likely to top 16 baht per litre for the first time this week, while pressure is mounting for increases in the prices of cooking gas and electricity, industry sources say.
The trend reflects the latest rally in world oil prices. Pump prices have been stable at 15.89 baht per litre of premium petrol for about a month. But the Petroleum Authority of Thailand (PTT) is poised to increase the price of petrol and diesel oil by 30 satang.
The price of cooking gas is expected to rise within a few months as the Oil Fund, which has only one billion baht left to subsidise the product, will be exhausted within two months.
Oil traders are required to contribute 45 satang per litre of petrol and 25 satang per litre of diesel oil to the fund. The contributions are strongly opposed by oil traders.
PTT governor Viset Choopiban claimed that oil firms were selling petrol at a profit margin of 48 satang per litre, below the break-even level of 90 satang.
Current pump prices in Greater Bangkok for all brands are 15.89 baht per litre for premium petrol, 14.89 baht for regular, and 12.99 baht for diesel oil.
Last year, premium petrol peaked at 13.89 baht, regular at 13.09 baht, and diesel oil at 11.04 baht.
Mr Viset said local fuel prices were under pressure on two fronts. Increasing world prices, insufficient supplies in many regions and production cutbacks were the external factors.
On the local front, the contributions to the Oil Fund and the weakness of the baht were lifting prices.
"That is why the local oil price stayed put when the world market price came down a little," he said.
He said the gas subsidy should be abolished and cooking gas should find its true market price.
An official at the National Energy Policy Office said electricity tariffs would increase soon as an element of the fee structure reflecting oil prices would have to be revised this month.
The fuel factor, known as FT, stood at 61.52 satang a unit in April and is revised every four months, based on changes in oil prices.
Chaivat Chritti, PTT Oil's senior vice-president, said that if world oil prices remained at current levels domestic pump prices could be increased again next week to partly offset losses in trading margins.
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FYI 1US$=40ThaiBaht
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