aka: ThaiGold's 2001 WishListALL: Wishing everyone in the Forum, a Happy New Year.!.
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As we enter this New Millenium, 2001 holds alot of promise. Let's hope the
next 1000 years will be better than the last 1000 years. Afterall, it couldn't
be much worse, could it.?.
Predictions, accurate ones, are not my forte'. As most of you know. But at least
allow me to put forth my WishList. I cannot see into the future as far as most
of you can. So I'll limit the scope to only the next four years.
[Energy]
Top of my list. Everyone's list. Continued shortage of refinery capacities
and increased wastefull consumption will lead to extreme conservation measures
enacted (once again) by government. Remember the 55 MPH speed limit.?. It'll
be back. Remember Nukes.?. They're gunna be back in vogue. Remember Clean Air
Standards.?. Out. Like the lights of Kalifornia.
New energy sources will become economically feasible. Look for breakthroughs
in Solar grids. Look for Shale-to-Oil. Remember coal.?. Better look it up.
But transcending all of those, will be new (small) (in-home) Fuel Cells. Using
water as fuel. Yes, water. And Platinum. And Silver. It's so easy, to electrolyze
Hydrogen and Oxygen from water. Burn it to create heat; make steam; turn your
turbine; and use a tiny fraction of the electricity produced to feedback into
the electrolyzer. Even smaller Fuel Cells will be adapted to autos and trucks.
It's common sense, not perpetual motion. Trust me.
[Stock Markets]
After DOW and NASDAQ (et al) crash to 500 and 50 (respectively) several new rules
will be enacted to stabilize such markets. The biggest will be the banning of any
and all "short" sales. If you ain't got it, you cannot sell it. Nor manipulate it.
[Precious Metal Shares]
Gold/Silver/Platinum/Palladium producers (mines) will see their shares vastly
outperform any of the other stock market shares. (see below -- $USTSC & $USTGC).
Meaning, ones that currently have *real* production and facilities. And ones not
hamstrung with faulty hedging programs of the past.
[Other Paper Markets]
Hapless "investors" in the Futures Markets (Gold/Silver/Platinum/Palladium) having
seen all their Metal Delivery Contracts evaporate into UnDeliverable status, will
welcome the new rules to be enacted: No more "short" sales, except from bonafide
(mining companies) producers, and then, not for more than a proven-capability of
a single year's forward production. Sellers will require a government license. And
buyers too.!. (see below) Only bonafide producers and fabricators will be allowed
to participate in PM "Futures". These will even become somewhat pointless.
[Derivitives]
Commodity and Stock Options, Puts, Calls, Index Funds, and all forms of Derivitives
will be banned. As nothing more than proxies for gambling. Market Stability becomes
the paramount concern of the regulators. These have not and never will, contribute
to authentic market activity. You wanna gamble.?. Go to Vegas. Or your nearest
Native American Casino. Fun is where you find it. You won't find it in the Markets.
[US Dollar]
Defined as "Federal Reserve Notes" (FRNs). These will "decline" until they reach their
ultimate "strength": Equal to one of the new USTreasury-issued $USTSC or $USTGC forms.
(see below).
[Federal Reserve Bank(s)]
FRB Chairman Alan Greenspan will be seen as foot-dragging or powerless to control
a spiraling (downward) USA economic system. The New Administration will phase out
the FRB concept. And replace it with the Constitutionally mandated US Treasury as
the ultimate and absoloute source of (Congressionally Decreed) (NEW) USA currency.
(see below). The FRB and Branches will become "nationalized" and function as local
Branches of the US Treasury. No-more an automonous privately held unaccountable
nightmare of credit and manipulation. Greenspan is out. Secretary of Treasury is
the new Currency/Credit Czar. Accountable to the President. Congress. And the People.
[$USTSC & $USTGC]
USTreasury Silver Certificates and USTreasury Gold Certificates will be issued to
phase out FRNs. Issued directly by the US Treasury. Backed by the Full Faith and
Credit of the US Government. And backed by whatever Silver and Gold remains in
the US & FRB-NY vaults. Plus (mandated) ALL future Silver and Gold production that
comes from the (USA) mines. US Treasury is the (mandated) only buyer of it, with
few exceptions, by government permit, for industrial fabricators.
$USTSC circulates side by side with US Silver Eagles, at face value.
(1 $USTSC= 1oz Silver)
$USTGC circulates side by side with US Gold Eagles, at face value.
(1 $USTGC = 1oz Gold)
FRNs will decline in quantity to become interexchangeable, until withdrawn completely.
That means, they will become STRONGER in purchasing power, as it takes only 50 of
them to purchase a new $USTGC or 1oz Gold Eagle. Ditto in the case of $USTSC, the old
FRNs will become stronger, whereupon only one is required to purchase one $USTSC or
an oz of Silver. But initially, FRNs will remain as Legal Tender for purposes of
monetizing preexisting US Dollar-denominated Debt(s). Public and Private. During
that period, they remain a "weaker" fiat currency, needing 500 to purchase 1oz Gold
or 50 to purchase 1 oz Silver. It sounds confusing, but isn't. Trust me.
[EURO]
The European Common Union's EURO will be forced to undergo a similar transformation
to remain competive for world trade, and to have local credibility with populace.
It will emerge in forms similarly backed by Silver and Gold. A similar phase out
process will occur. EURO SC and EURO GC will become identical in valuation to the
$USTSC and $USTGC coin and currencies. All or any of those will be (eventually)
accepted at par, as Legal Tender, in the newly stabilized world trade environment
as well as newly invigorated local economies.
[Other Currencies]
Silver and Gold backed equivilent currencies will become a necessity for all other
nations. And well to their advantage to do so. Hey.!. You wanna "trade" with us.?.
Then get-real with your coins and currencies. Fiat is Finished.
[New Common Markets]
Latin America (South, Central, and Mexico) will form a Latin America Common Market.
Call it the LACM. Their Silver based common-valued coin and currencies will provide
the stability for growth and integrity required of them to become vibrant and strong.
Asian Countries will form similar Common Markets. And institutionalize similar
Silver and Gold backed international standard coins and currencies.
Mid-Eastern countries, OPEC etc, will be quick to join in favoring standardized
Silver and Gold based coin and currencies. They will accept nothing else for their
coveted oil. They will not want to be left behind or cheated with fiat any longer.
African countries will find it easy to transition to precious metal based coin
and currencies. Of the international standard. Afterall, they will be the major
providers of metals to many non-resource abundant countries. (Europe etc)
Russia and the old remnants of the USSR will not wish to remain outside the world
circle of PM based coin and currency. Rich in PM's, they need only institute rigid
safeguards to insure their mine production(s) actually reach their Government(s)
Treasuries, for the subsequent and required minting and currency backing. President
Putin of Russia, will be strong enough and savvy enough to ramrod this into being,
and get tough on the corruption that currenty saps that region's great PM wealth.
Canada, of course, being rich in Precious Metals, will welcome similar revisions
to their coin and currency. Once again they will become proud of their Maple Leaf
coins of Silver and Gold. And Loonies will no longer be looney.
Australia, also rich in PM's, will lead the way to a rebuilt "Common Union" with
Canada, and the United Kingdom. This will be very popular with their citizens,
and as an act of comradarie, assit England (UK) to become strong and prosperous
once again. A new "Empire", based upon Common Markets, and commonized PM money.
[POG / POS]
The "Price of Gold" or "Price of Silver" will become a thing of the past. Meaningless
terminology. The "price" of Gold, will be, simply, an ounce of Gold, or a standardized
Gold Certificate issued by any number of cooperating countries. And too, the "price"
of Silver is simply, one ounce of Silver, or 1/50th ounce of Gold. And yes, the
"price" of Gold will also be defined as simply fifty ounces of Silver. See how easy.!.
In terms of the old (to be phased out) FRNs (and even old EUROs) you will see a
transitionary period where these will be "deflated" to an equilibrium valuation.
Then withdrwan from circulation (see above). So, initially, during the transition
period, people may talk in terms of Gold is at $500/oz in FRNs, or Silver is $50/oz
in FRNs. Knowing this, you will, of course, not get caught holding FRNs for very
much longer. Will you.?.
[Real Estate]
Housing, and the Property(s) upon which it's built, as well as pristine undeveloped
property will, as always, retain it's intrinsic value. And continue to appreciate
as it inevitable becomes more scarce. Never underestimate the "value" of prime
real estate, as a preserver of wealth. Beware of speculation bubbles that have, in
the past, overvalued or inflated it unrealistically. Under the new coin and currency
standards, nothing changes any of that.
[Credit and Banking]
In previous eras, when money was linked solidly to precious metals, Banks were able
to thrive and modestly increase the money supply. Via sensible credit and lending
practices. Strictly controlled "reserve" requirements will be instituted by the
(US)(and other government's) Treasury(s). Gold and Silver Certificate Banking, to
include checking and savings accounts, will be as safe as FDIC-insured nowadays.
Credit, in those days was generally "secured" loans. We will see a return to that
concept, with little if any "unsecured" flippant credit. A vibrant economy does
not need alot of unsecured credit. It's dangerous and counter productive.
Growth in the Money Supply comes from two sources in the future:
(1) Mine Production and (2) Sensibly controlled Lending by Banks.
[Consumer Prices & Inflation]
These will stabilize within reasonable ranges, priced in the new coins/currencies.
There will be a transitionary period of helter-skelter "inflation" in terms of the
old (to be phased out) FRNs. But generally, nothing to be alarmed about. No hyper-
inflation, and no $30,000/oz Gold is on the horizon. It ain't gunna happen. The
government(s) will step in way before that could ever materialize. Using all
of the above to thwart such unthinkable chaos. Governments are dumb, but they are
not stupid. And, as always, they, and only they, determine what you call "money".
Just deal with it. Be prepared personally. And enjoy the New Millenium.!.
Attn: Peter AsherHi Peter
Your post of yesterday (?) about the set of rare "The Story Of"
books, that Robin miraculously rounded up and gave to you
for Christmas, was quite moving.
But I think you overstated the helpfulness of the Internet.
Surely, a person with as big a heart as Robin, would have
obtained them for you, even without the Internet. It might
just have taken her a few days longer.
She deserves another, even bigger hug from you. Right now.!.
Re-kindle of my post #44564 of 12-27 ... forced margin liquidations
When you re-kindle a smoldering fire, three things are required: stir up the hot coals already there, add some additional fuel and patiently wait for results. In that same spirit, I thought that it would be productive to re-kindle my post #44564 of 12-27.
In that post, I suggested that PM prices are not quite responding to the known supply and demand fundamentals as would be expected. I then suggested a possible conclusion that: A temporary situation may exist whereby STOCK MARKET MARGIN CALLS are having a negative and significant impact on PM prices.
From my list of 77 different twists that can significantly influence the SUPPLY & DEMAND EQUATION for an given investment area, I will bring two more into the discussion.
#67 MARKET PARTICIPANTS AT THE MARGIN (A Doug Casey thought) "The market price for real estate is not being established by the 98% of the participants that are merely holding but rather by the 2% of the people that are currently in the market doing the buying and selling." Thus, the price of real estate is actually being determined AT THE MARGINS and by only 2% of the participants. In essence, the supply and demand fundamentals of this minority are the ONLY force that are determining current market direction. To what extent is your investment area subject to this "at the margin" phenomena? What are the supply and demand fundamentals for this pivotal "at the margin" group?
I believe that the PM markets are likewise subject to this "at the margin" phenomena. Only the active participants on any given day, are actually having an influence on PM price. Individuals on the sidelines are in fact, having negligible influence on price. Granted, we buy and sell PM's more often than houses and therefore the percentages may be more like 10% to 90%. But nonetheless and by default, only members of the select 10% group are steering the market ... no matter what you think or believe should otherwise be happening. Therefore, a careful analysis of the make-up and supply and demand fundamentals for the 10% players, should result in a much better explanation of near term PM price action.
#35 NEED FOR A WORLD VIEW. Attractiveness with regard to local, national and worldwide supply and demand forces. Currently, no new nuclear electrical generation plants are being built in the US and none are planned. In the US, everyone knows that the industry is practically dead. Nonetheless, Korea and China are building nuc plants like gangbusters and the world demand for fresh uranium is in a solid uptrend. Without a world view, you would be completely off the mark in your analysis & you would have missed out on a golden investment opportunity. Is the investment a "buy", "sell" or "hold" with regard to local, national and international concerns? What are the "worldwide investors" doing with your commodity? What does the world think?
I mentioned in my previous post that stock markets were falling worldwide and that the NASDAQ was leading the charge. Doesn't it also follow that stock market margin calls may be taking place worldwide? If this is true, then a pool of forced sellers of PM's is much larger and of a different character than the typical NASDAQ participant. They may have some PM's to sell. This un-acknowledged group of margin forced sellers could be the pivotal responsible party for our present un-happy PM prices.
I would be the first to admit that almost none of this can be proven. But, by the same token, it is likewise diffiult to disprove as well. The logic is facinating don't you think? Was it worth re-kindling the fire?
"African countries will find it easy to transition to precious metal based coin and currencies. Of the international standard. Afterall, they will be the major
providers of metals to many non-resource abundant countries. (Europe etc)"
Can you please name just ONE african country that can say it as ownership of it's resources? Does Mali own it's gold? Does Ghana own it's gold.? Does .... For the answer to the question of ownership of african sources, please consult Goldman Sachs, Shell et al.
Ski you offer an intersting idea and lay another possibility on the table. As you indicate, whether you are right or wrong is not provable at this time, however, I, and I think most of your other fellow members, like and appreciate your critical thinking.
In my opinion gold is languishing because few people in the USA have any interest in it. New housing starts, automobile sales, and anything which can be purchased on credit has been setting new records for the last 10 years. Our nation is being beseiged with such an enormous quantity of merchandise, very attractively priced, very professionally merchandised with deals you can't refuse, and, very simply, many of your fellow citizens don't even try. Some people would buy an ocean liner docked in Omaha, if they could get it on credit.
In a nut shell, wealth, like beauty, is in the eye of the beholder. A new red Harley offers far more sex appeal, sense of excitement, and thus a lot brighter shine than a pocket full of gold coins, and besides, all these attributes may be enjoyed so long as you don't forget send the payment each month.
When you add this possibility, to your possibility, and the many other possibilities offered on this forum, including government manipulation, the fact that gold is even at $275 seems almost a miracle. Thanks again for your contribution to the forum.
We may not get the problem solved, but at least for me, the challenge offers far more appeal than what is being merchandised as entertainment by any of the television networks.
i have a friend who regularly purchases gold bullion on his credit cards, he calls it his "life insurance policy".
he says he pays $200 in cc payments for each $10,000 in gold he purchases. he claims the interest on his payments is 2.99% to 9.9% apr.
for example, he just purchased 10 liberty double eagles for $3325.00 ("premium quality BU, includes shipping).his payments are approx $70 per month for such a purchase.
i ask him if he ever worries about not being able to come up with the payments, he says gold bullion is all he puts on his cards and if he was ever hurting to make a payment, he'd just "sell a coin".
For what it's worth, this is a message I wrote to clients this morning. I only have a few clients, and I do not accept new ones.
Aftermath of the Technology Bubble
Corporate Debt at Dangerous Levels
With the bursting of the tech bubble on Wall Street, the speculative binge of the past couple of years has now ended. The year 2000 was the worst in history for technology stocks, with the NASDAQ recording nearly a 40% loss. But the speculation in stocks was not the only risk-taking that went wrong in the recent past. Far from it, in fact. Emboldened by an accommodative Fed and by talk of a "new era" of perpetual prosperity, American corporations have leveraged themselves to the hilt. Many may now find it difficult, in a slowing economy, to pay their debts and meet rising expenses. For months already, thousands of dot.com workers have been losing their jobs. But now lay-offs are spreading to such"old economy" companies as General Motors and Gillette, while names like Montgomery Ward and LTV are announcing they will shut their doors for good.
Consequently, as of their December meeting, the Fed has now given up even the pretense of fighting inflation. Despite the greatest cost-of-living increases Americans have seen in 10 years, the Fed has said they now view recession as a greater risk to the economy, and they have adjusted policy accordingly. Of course, as I have argued in the past, high levels of money growth have meant the Fed wasn't really fighting inflation anyway.
So, on top of everything else, are we now in a recession? Perhaps. Technically, a recession is when gross domestic product shrinks for two consecutive quarters. Alan Greenspan does not wish to be blamed if that happens in 2001. Consequently, in recent weeks, the Fed has accelerated the rate of money growth in the American banking system. During the first 3 weeks of December, the broadest traditional money measure, M-3, grew by $50 billion. If maintained, this rate of growth would constitute an annual increase of more than 12%, which may be just what the doctor ordered for an ailing economy. But, with official inflation already close to 4%, a monetary expansion on this scale virtually guarantees still more inflation is on the way.
In the 70s, this was Called "Stagflation"
And not since the 1970s have there been so many signs of stagflation. Last week, for example, Fed Ex announced a 4% rate increase for overnight package delivery. This comes atop another 4.9% increase which was announced earlier in the year, meaning that customers will now pay 9% more than they did just 12 months ago. The reason given by the company was that business is slowing now, forcing them to spread their costs over a smaller number of packages. In other words, if they can't make more money by growing the company, they will make it simply by charging more. With exploding costs for all forms of energy and for employee health care coverage, this mentality is almost certain to spread through much of corporate pricing in the months ahead.
Meanwhile, America's energy companies continue to shine in a largely bleak investment landscape. This is because oil, oil service and natural gas producers are presently enjoying their greatest period of profitability ever. Insufficient infrastructure investment in each of these areas has left them vulnerable to shortages in the period immediately ahead. This month, people all over America will open their heating bills and be shocked by what they see. Yet several OPEC members are already hinting that further production cuts are in store for their January meeting.
Whatever happens in the months ahead, the U.S. economy is clearly in for some tough sledding. The likelihood of a weakening dollar has seldom been greater, in my view. For this reason, I believe energy and precious metals stocks, such as the ones we own, will be productive investments in the year 2001.
However, I think you missed the point of what the Net facilitated. Most of these books were obtained from private individuals and only through the connectivity of WWW could this kind of contact been established. Absent this phenomena, which even then required many days worth of search, negotiate, arrange and recieve, it could not have occured at all.
Have a look at where the shepherds are leading the flock.
Street experts see better days in 2001
By Adam Shell, USA TODAY
NEW YORK � After the market's dismal performance this
year, you'd think Wall Street seers would have soured on
stocks. They haven't. Strategists from 10 of the top
brokerages expect battered stocks to bounce back and post
double-digit gains in 2001. On average, 10 investment pros
interviewed by USA TODAY think the Standard & Poor's
500 index will rise 18% by the end of next year.
Even considering Wall Street's propensity to be bullish, that
mindset might seem surprising considering how the market is
limping into 2001:
The S&P was down more than 9.2% for 2000 as of
Thursday's close, its worst year since a 9.7% loss in 1981.
Down 37.1%, the Nasdaq will post its worst year since
being created in 1971, barring a massive 11th-hour rally.
The Dow industrials are down 5.5%, the first annual loss
since 1990.
So what about 2001?
UBS Warburg strategist Edward Kerschner is the biggest
bull. He expects the S&P 500 to end next year at 1715, a
hefty 29% above Thursday's 1334 close.
Stocks should move higher, he says, because they've taken
such a beating that they're selling for less than they are worth.
"The glass isn't half full, it's empty," says Kerschner, noting
that the S&P's price-earnings ratio is almost 20% below
where he says it should be.
Douglas Cliggott of J.P. Morgan is the most bearish and is
preaching caution. "Be careful," he says. He expects a rough
start for stocks and a modest recovery in the third and fourth
quarters. His year-end S&P target: 1400, a 5% gain.
Cliggott expects flat profit growth for the S&P 500 in 2001.
That's a far cry from the 6% to 8% growth analysts expect.
"There's a lot more negative earnings news in the pipeline,"
Cliggott says.
Another negative: Investors burned by the Nasdaq's 49%
plunge from its high are likely to decrease their exposure to
stocks, he says.
But forecasting stock prices is an inexact science. Last year,
most strategists got it all wrong. Most predicted gains.
The weight of six interest rate increases, the bursting of the
tech-stock bubble, record high energy prices, a slowing
economy and election uncertainty took stocks down hard.
Year-end 2001 targets for the Dow range from 12,000, a 10%
gain from 10,869 Thursday, to 13,000, a 20% jump.
How will hard-hit tech stocks fare next year? Bulls such as
Christine Callies, strategist at Merrill Lynch who started the
year on a conservative note, expect techs to stage a recovery.
"The big driver of rising stock prices will be lower interest
rates," she says. Merrill expects the Federal Reserve to slash
short-term interest rates by at least 1 percentage point by
midyear. A slowdown in tech spending, she says, is already
factored into stock prices.
Less exuberant strategists like A.G. Edwards' Stuart Freeman
expect tech stocks to remain under pressure. "We've had a
significant shift in psychology," he says. "We won't have the
type of activity that will result in another frenzy."
Enjoyed your piece, Days of Gold Gone By! Thank you.
Couple of tidbits {Tedbits in this case}- The rumors of Ted Butler's literary demise were premature. He has a new article out & he is still on the frontlines of the silver war. That is more exciting to me than any of the football games {why is football no longer interesting?}!
A recent article by Edmond Bugos quoted George Seldes from 1942 to the effect that "public opinion is generally the most powerful force in America". I found this to be rather profound today, even though on its face it is quite simple. It does pertain to this Forum as this is a place where 'public' opinions are both expressed and formed. We are in a cultural war folks and we cannot shirk from that fact. I wrote a letter to my Congressman yesterday encouraging him to seriously look into the gold manipulation frauds and GATA claims. I'm quite sure he's not gonna peer too deeply under the IMF, Fed Reserve, or GS rocks as it is pretty hideous under them. On the other hand he does have some vested interests that align with our side. I am also aware that I have completely "come out of the closet" in this free market/cultural war over the last several years; they won't have to search too hard if they want to start rounding up the "dangerous elements".
Please allow me to ask a few {redundant} questions--
1- Do you want to live in a country where you are afraid to express your deepest concerns to your elected representatives?
2- Do you live in a country where you are afraid to express your deepest concerns to your elected representatives?
3- Are you afraid to express your deepest concerns to your elected rerresentatives?
Let's keep in mind that "public opinion is generally the most powerful force in America". What we post here and elsewhere, what we write to our officials, however we express ourselves matters a great deal. I will put out a satirical piece later this week that goes right up to the edge {and well past it} of maligning Sir Scumbag in terms that much of our culture can relate to, knowing full well that many others would like to see me donate some Georgia Mountain oysters for same. So be it, I refuse to hide from the cultural war we are in. No DENIAL here.
Thanks for the ear!
GO GATA, GOLD, & SILVER. Scumbags away..........
I would like to offer my sincere apology to Michael and all on this forum. I knew an old man, homeless I think. His name was Floyd. He was passing through Cape Girardeau, Mo. some 30 years ago. When I say passing through I mean passing through. He was walking. Winter was coming on and the old man was heading south.
My best friend saw him walking along the highway and took him home to give him a few good meals, a few good nights' sleep, and a warm shelter. A few days later he dropped Floyd off (Floyd's request) in the same spot where he picked him up. We never saw Floyd again.
While Floyd was at my friend's house my family, wife and daughters, had the occasion to visit and eat around the table with Floyd and whoever might find a seat. My friend almost never sat down to a meal at his own dining table without at least a few visitors. His was simply the most hospitable family ever to grace the city of Cape Girardeau. They had little in the way of material things. He was a carpenter by trade, self-employed and took mostly handyman jobs, which did not pay much but made for lots of different jobs and opportunities to meet lots and lots of people and invite them to his home for a visit. This family lived a very humble life. Their largest monthly expenditure was on food (they had six children) mostly because of all the guests which routinely showed up. They made it a point to always have enough food on hand to feed at least 20 or thirty people just in case a large number showed up. Suddenly it occurs to me that I should not be presenting this story in the past tense because nothing has changed with them for the last 30 years. If I were to drop in on them tomorrow I would be treated not only to a meal but would also probably be in the company of someone whom I had never met with the opportunity to make an instant new friend.
Now back to Floyd. He was a very large man and could consume huge amounts of food. He also had a problem with flatulence. We got use to his breaking wind often and loudly at the dining table. Each time he did this he would say, "PARDON ME FOR LIVING." Floyd was a very humble man and very gentle with the children. He was so wonderful in so many ways that no one took offence to his problem with flatulence. Many of us old friends still reminisce about Floyd. We have guessed that Floyd might have been an angel being entertained unawares.
Now to the point of this post. I know that the purpose of this forum is to discuss PM's, namely gold, and the economics and the financial market dynamics which affect the subject. That is why I lurk so much. It is of great interest to me and I have the opportunity to learn about these things more quickly here than any other place on earth. Besides the efficiency of learning, it is great fun to visit this forum and is an opportunity to get to know some real thinkers.
Now when Sir Holtzman posted his religious thoughts he stirred something inside me, something which has nothing to do with gold. It was my understanding that he e-mailed his offering to Michael and that Michael gave his tacit approval to the topic by posting it for him. I took that to mean that Michael would not be opposed to equal time. I may have taken more than my equal time.
When Floyd broke wind he did it to relieve pressure. He had no choice. He could not help himself. He was just unable to hold the gas in. The same thing happened to me when I read Sir Holtzman's post. I just broke some wind. I did it to relieve pressure. I had no choice. I could not help myself. I was just unable to hold back. I called it, "earnestly contending for the FAITH once delivered to the saints". When one reads Holtzman's post in its entirety one should have no difficulty seeing why one who believes what I believe could not simply remain silent.
I shall try to refrain from using too much band space on religious thoughts in the future. Michael, I can only think of one way to apologize in true sincerity. I can only say along with Floyd, "PARDON ME FOR LIVING." I cannot promise to never to let off gas again should the pressure build beyond my ability to hold it back. When doing so I will try to remember to reveal my subject in advance by placing in the subject area, - PARDON ME FOR LIVING.
Sir you have been the most congenial of hosts. You have put up with a lot on this forum. The wisdom of your tolerance is very clear. I will continue to do a bit of janitorial work. If you object I prefer to be warned rather than having my posting privileges removed.
What a heartwarming post! I'm still laughing! You share the qualities of humility and gentleness with Floyd, and I'm glad you brought his story to the Table Round.
Whoops, my husband's calling - back to the kitchen we've been remodeling for the past few weeks. Cabinets are going in. Bye!
Thats some fantasy you got in your head, Silver goes up ten fold and of course GOLD only doubles????
You must be sitting on alot of Silver that you can't sell at a profit and then buy Gold. So you'll try to get others to believe that Silver will go higher, so they sell their GOLD to buy more Silver or you just need a truckload of GOLD yourself.
It must really suck being short so much GOLD! Why don't you go post on a Silver forum if you think Silver is the place to be, your commentary is always misleading and today was no different. :-( P.S i'll see you when GOLD blows right through $2000/oz.
Sir HBM
Thank you for your rebuttal and discourse. Whilst I respect Mr Holtzman's right to his own beleif, views and opinions and will protect his right to express them, I for one, Sir HBM much prefer your stance and convictions by Faith. Your perspective and Faith can only be founded and anchored to the Rock; and He and His Father in heaven provide Golden Wisdom. Thank you and a healthy properous New Year to All.
"S"
P/S: A man I once met, similar to Floyd, simply would say "Oh pardon me, a man gots to do what a man gots to do". "S"
Topic: The Stranger msg#44810
Peter Asher msg#44813
Hill Billy Mitchell msg#44815
to name a few
For myself, today is a day of thanks.
The Stranger offers his eagle's eye view of the economy, with humility ie. 'for what it's worth'. Yet his is clearly a very informed view that reflects a lot of homework and a lot of thought...all of which is freely shared.
Peter Asher says 'have a look at where the shepherds are leading the flock'. In so doing, he instead places the focus on a single issue ie. the interaction, between on the one hand, the experts, who make sounds, who after all are mere mortals expressing their opinion [or are they], and on the other hand, those who listen, and either don't think for themselves or do think, depending on their makeup.
So, at what other place I wonder, does one find such an individual group of thinkers...and yet at the same time, a place where one can let it all hang out and it be ok ie. Hill Billy Mitchell. Search me.
Why, if I didn't know you better, I'd think you were a Utah BEAR. Not too many bears in Missouri; that's why I sometimes feel like an endangered species. :>)
How can you believe anything written about the oil market? Why are prices dropping with strong demand, loss of refinery capacity, no enough tanker capacity, low inventories etc etc etc ad infinitum? Anyone want to take a stab at this one?
I just went digging and found last Thursday's money supply report. Seasonally adjusted M-3 rose $55 Billion in a single week. This brings the 4 week total to $105 billion, an annualized growth rate of about 18%, not the 12% I mentioned here earlier.
A quick glance at your dictionary will assure you that this is the very definition of inflation. You can forget all of this talk about the Fed being stingy with interest rates. The Fed is hitting U.S. banks where it counts. There is no other word for this kind of money growth but awesome.
Clearly recent employment numbers, along with the poor Christmas retail environment have spurred Greenspan into action. Whether he is too late to avoid a recession or not is still debatable, but he obviously has been buying treasurys and lots of 'em.
Why does this matter to a bunch of gold bugs? Because in the conflict which presently exists between supporting the dollar and saving the economy, these numbers indicate clearly that the decision has been made. DAMN THE DOLLAR. FULL SPEED AHEAD!
This time of year, people who heat with oil have largely filled their tanks, yet we are months away from the summer driving season. Additionally, all of the world's energy resources have been operating close to capacity. This is why the respite in oil prices. However, this month OPEC will no doubt impose an export reduction of 500,000 or more barrels per day. Believe me, oil may touch below $25 from time to time, but that is all. I would expect prices to average at least in the high 20s as summer approaches.
Hope that helps.
Thanks to you and Genoo for your acknowledgements today.
Date: Mon Jan 01 2001 18:19
Fubarite (GATA/ Howe make it to mainstream press in OZ) ID#19380:
-
Golden Chance Awaits Miners
By JamesDunn, 02 Jan 2001
I have just finished reading Peter L. Bernstein's The Power of Gold, sub-titled The History of an Obsession ( John Wiley & Sons, $39.90, hardback ) and it got me thinking about the gold market.
If, like me, you love a well-written economic history book, Bernstein's aptly titled ( and sub-titled ) book will make a perfect use for that book voucher you got for Christmas.
Bernstein's major theme is that the gold market has never been � and can never be � a simple commodity market, because of all of the emotional capital we humans have invested in the yellow metal. After the excesses of the pillage of the new world by the old, this reached its zenith in the days of the gold standard, when the world's currencies were simply names for certain defined weights in gold.
We have largely demonetised gold, in that it no longer backs our currencies. When the European Central Bank was formed to oversee the euro, only 15% of the reserves to back that currency were in the form of gold. Gold is still money, just not officially.
Looking around the gold market these days, you would have to say that it is still far from simple: it is just that the complications are new. The gold market is artificial. The physical market � the annual trade in gold mined � is utterly dwarfed by the market in derivatives, gold futures and options contracts.
US gold analyst Paul van Eeden calculates that about 260,000 tonnes of gold is turned over in total each year on the London Bullion Market � nearly twice the amount that has ever been mined. Only about 5000 tonnes of physical gold, says van Eeden, is traded each year. That is less than 2% of London turnover. The notorious central bank sales � which garner all the headlines about depressing the gold price � make up less than 0.12% of the gold market.
Miners and consumers of gold are bit players. The derivatives market controls the gold price. Gold is not a supply/demand-driven market, it is an exchange rate-driven market, because the price is determined by the value of the US dollar.
The US dollar has usurped from gold the role of asset of last resort. If the US dollar were to fall, the gold price as expressed in US dollars would improve.
That would suit the Australian miners, whose gold price � expressed in $A � is actually very healthy. At the currency's record low of 51.1 US cents in October, the $A gold price hit a record high $A526 an ounce, a rise of almost 40% in a year. It is now at about $A496 an ounce. If an Australian miner is not able to achieve excellent margins at these prices, it should not be in business.
The build-up in the gold derivatives market has created a huge overhang in the gold market. Nobody really knows how large it is, but two quixotic court cases aim to try.
The first suit is dynamite stuff. It is being brought by one Reg Howe on behalf of the Gold Anti-Trust Action Committee ( GATA ) , which has accused some of the financial world's most powerful individuals and organisations of masterminding a global conspiracy to keep down the price of gold. First defendant is Alan Greenspan, chairman of the Federal Reserve Board of the US. Joining Greenspan as defendants are soon-to-be-former US Secretary of the Treasury Lawrence Summers, William McDonough, President of the Federal Reserve Board of New York, and the firms of Chase Manhattan, JP Morgan, Deutsche Bank, Citibank and Goldman Sachs, among others.
The suit alleges that, because the highly geared mountain of gold derivatives is mainly a bet on the gold price falling, all of the named parties have colluded to keep it from rising, so as to protect the global financial system from the consequences of the unravelling of the derivatives positions.
The second is a class action filed in a US court by aggrieved shareholders of London-based Ashanti Goldfields, which almost fell into bankruptcy in 1999, when the value of its hedge book plummeted. It seemed that Ashanti had been too clever in trying to lock in forward prices for the gold it was mining in Ghana.
Now Ashanti shareholders are demanding unspecified damages for alleged "reckless financial speculation". The shareholders are alleging that when they thought they were shareholders in a gold mining company, Ashanti was actually gambling with exotic financial instruments, the success of which required the price of gold to fall indefinitely. Ashanti chief executive officer Sam Jonah and ex-chief financial officer Mark Keatley are also named personally as defendants.
Tilting at windmills? Maybe. Quite possibly, by the end of the cases, investors will know more about the real gold price, and the intricacies of hedging activity, than ever before. At least, the prospect of a decline in the US dollar � more real for investors � is in the offing for gold shares, which should make the Australian branch of the industry appear good value indeed on a global scale.
This article first appeared in the Weekend Australian of December 30-31
"The financial sector goes into "Crisis Management Reliquefication Mode (CMRM)."
"CMRM entails immediate and aggressive action, with the old stalwart Goldman Sachs leading the charge. The firm takes a major leveraged position in Fannie Mae Long-Term Debt Securities to the tune of $50 billion. Since these are top-rated securities, this transaction is easily consummated by Goldman borrowing $50 billion in the money market (from the Money Market Fund using Fannie Mae Securities as collateral � a "repurchase agreement"). These "funds" are used to purchase $50 billion of the Household Sector's Fannie Mae Long-Term Debt Securities, held on account at Goldman Sachs. The $50 billion of proceeds are instantly deposited (electronic journal entry!) into the Money Market Funds on behalf of the client, the (now much more "liquid") Household Sector. In this case, Goldman's balance sheet increases by $50 billion to $250 billion, with Holdings of Long-Term Fannie Mae Securities increasing $50 billion (to $250 billion) and Borrowings from Money Market Fund ("Repo") also increasing $50 billion (to $250 billion). Total Household Sector Assets remain the same at $1.1 trillion. While Holdings of Fannie Mae Long-Term Debt Securities were reduced by $50 billion (to $50 billion), Money Market Fund Deposits increased $50 billion (to $450 billion). Through this leveraged transaction (an increase in financial sector liabilities/an expansion of financial credit!), Money Market Fund assets (broad money supply!) actually increased by $50 billion to $450 billion, with $250 billion of Holdings of Goldman Sach's Commercial Paper ("Repo") and $200 billion of Fannie Mae Commercial Paper. Money Market Fund liabilities "Deposits Owed to Household Sector" increased by $50 billion to $450 billion. Hopefully, this illustrates how financial sector leveraging increases so-called "liquidity," or the money supply."
http://www.bearforum.com/cgi-bin/bbs.pl?read=96317Vilnis: "My suggestion of what would work:
A 1000 to 1 exchange of old Federal Reserve notes for a new gold backed USA$ using the post revolutionary exchange of continentals for a new gold backed dollar as the model. That also was a 1000 to 1 exchange.
"What I did not make clear is that this necessarily implies a 99.9% reduction in all debt. My suggested solution is based on Austrian and not Monetarist economics. My suggested solution eliminates in one stroke the debt problem and provides a new credible currency with which to start the whole process over again.
"The people at the Fed are not dumb. They know there is a bubble. There are enough people at the Fed who understand that if the debt they created is not eliminated quickly it will be eliminated slowly, as in Japan: ten years and still counting. That would not do. The USA would lose its leadership role. That would put the USA system at risk: maybe civil war. Much better to get it all over with quickly and blame some one or some thing else for the pain: a war, short sellers, tax evaders, the drug cartel, libertarians etc. "
"Under the Austrian economics model a recession or depression ends when prices are readjusted to a level at which transactions can clear so that people start to trade/exchange again. The major impediment to getting to that is debt so the quicker debt is written off the
faster you can get to the point I would call party on. AG understands that.
"That is as close as I can come up with the perfect crime and biggest bust out in the history of mankind. Starting in 1982 when the USA financial system is under water because third world debt will never be repaid, the solution is make the USA the worlds foremost tax haven for foreign nationals not resident in the USA. Over the next 18 years go from the worlds largest creditor nation to the worlds largest debtor nation. Suck in trillions of DM, SF, GBP etc. ..."
A while back I had to stop writing. Several important things have taken most of my time and continue to do so. I let MK know of the uncertain nature of my continuing these discussions at the same volume level as in the past. But, as time presents itself I will update as able. I hope to bring up to speed several past discussions that were left cut off.
To do this, I'll have to conserve what writing time available by posting on the Gold Trail "as able".
Here is a very good writer that has offered an excellent update of the Euro situation. Please enjoy his clarity. Link is above and a portion below.
---------------------
U.S. and EU Economies May Be Moving in Separate Directions
William Pfaff International Herald Tribune
Friday, December 29, 2000
" " The explanation for this emergent autonomy of the European economy would appear to be the creation and coming of age of the common currency, the euro. Before monetary union, European exchange and interest-rate policies were largely dictated by the defense of relatively weak
currencies.
This usually meant maintaining national interest rates at levels that depressed overall European domestic activity and growth. The EU countries' economic policies were indirectly determined by reaction to U.S. policy on the dollar, formulated with reference to U.S., not European, conditions.
A pluralism of economic power has been on the way to restoration since the Europeans established their single market in 1992. Its achievement would mean that the world economy has two strong and autonomous supports, and that now seems nearer than ever before." "
The markets are discounting oil (in the future) due to anticipated economic slowdown. A couple of months ago refinery capacity was 'maxed out' at some 96%. A few weeks ago I noticed capacity was down to about 91.6%. OPEC has noticed and is REDUCING production. They were conned (forced?) into too many production increases last year (2000) and now have to quickly backpeddle or else oil will be in the low 20's.
Watch the refinery capacity, I think it is key to 'demand' for oil. If 91% of refineries supply the demand, excess oil is not required.
TG/FOA,
Welcome home and we trust matters and events in your life settle to a managable calm and peace.
Thank you for your valued contribution and guidance.
Happy New Year, I wish and pray you health, wealth and wisdom. "S"
YES! YES! THIS IS THE START OF REMARKABLE IRREVERSABLE CHANGE!
'2000 ends as a year most investors might like to forget'
"The world economy and financial markets are ending the year on a very different note than what was evident at the beginning of 2000", said Morgan Stanley Dean Witter's chief economist Stephan Roach.
"Boom-like expectations have faded, and the debate focusing increasingly on whether the world can avoid a classic bust," said Mr. Roach.
"One way or another, that debate will be resolved in 2001"
Cambior agrees deal with banks on restructuring
By Gillian O'Connor Mining Correspondent
Published: January 1 2001 20:08GMT | Last Updated: January 1 2001 23:03GMT
Cambior, the Canadian gold miner crippled by its hedge book problems in late 1999, has persuaded its bankers to extend the deadline for its financial restructuring to January 12. The previous deadline was late December 2000. The new US$65m credit facility should be in place by mid-month.
Cambior has also secured a $55m pre-paid forward sale of 234oz of gold.
The company, whose shares had tumbled from more than C$7 at the start of 1999 to a token 47 cents by the end of December 2000, was caught out by the sudden upwards spike in the bullion price after the "Washington Agreement" in late September 1999.
Under the agreement, European banks planned to limit sales and loans of gold.
Another company hit by the price rise was Ashanti of Ghana. Both organised their hedge books of derivatives on the assumption that the gold price would remain weak. It had been trading at less than $260 an ounce before the agreement, but rose to $317 soon after the announcement.
This left large notional losses on their hedge books, putting them under obligations to their bankers that they could not meet.
Cambior has since tried to secure temporary finance from its bankers and sell its base metal assets in order to continue to develop its gold prospects.
The proceeds of the sale of its zinc assets, the Bouchard-Hebert and Langlois mines in north-western Quebec, to Breakwater resources cut its debt by $45m. In December 1999 it owed more than $200m
But the sale of its La Granja copper prospect in Peru, one of the world's largest undeveloped copper deposits, ran into problems after the unexpected departure of country's president, Alberto Fujimori. A state auction in parallel with its own sale was postponed, but the sale to Billiton was eventually successful.
However, the combination of last minute legal problems and the Christmas holiday season combined to prevent it from meeting the late December bank deadline.
It is still hoping to sell two more copper assets - El Pachon in Argentina and Carlota in Arizona.
Attn: WAC (Wide Awake Club) (01/01/01; 06:43:21MT - usagold.com msg#: 44807)Hello WAC:
You asked:
[quote]
Can you please name just ONE african country that can say it as ownership of it's resources? Does Mali own it's gold? Does Ghana own it's gold.? Does .... For the answer to the question of ownership of african sources, please consult Goldman Sachs, Shell et al.
[unquote]
Answer:
Of course, you are very correct, as things stand now. But I'd
foresee those African (and elsewhere) countries nationalizing
or "virtually confiscating" all their mine outputs, same as will
happen in all other countries, once Gold (and Silver) become
the international money standard. Even USA and Canada, etc.
The point is, PM's would become the new National Treasury
Resource of every country, rather than the "commodity" that
they currently are. The essay made clear that (with very few
exceptions) all mine outputs can *only* be sold to respective
Treasuries. For minting and backing, which is the primary item
which grows their money supply, credit, and national wealth.
What's leftover, is then marketable (as a govt export) to those
countries shy of such resources. Further enhancing the origin
country's GNP/GDP.
Foreign owned mines (same as domestically owned mines)
would still be free to operate at a profit, and perhaps even
retain ownership. Why not.?. It's just that they would be very
limited in to-whom they could sell their output product.
Throughout my essay, I tried to give Gold equal treatment
with Silver, in an unbiased way. Although, you are correct
that I tend to favor Silver nowadays. Because of fundamentals.
It's my understanding that this Forum's scope is wide enough
to include rational discussion of *all* precious metals, not
at the exclusion of silver, platinum, palladium, or rhodium. And
as well, anything affecting markets therin. Such as energy,
oil, natural gas, electricity, politics, and poetry.
Give us a break. We cannot all be GoldBugs 100%. Even we
enjoy here to read other's viewpoints regarding paper products,
such as Futures and Options. And often we even enjoy those
comments of others, inclined towards DOW and NASDAQ
issues. Dot.Coms whatever. Times change. And many come
here to lurk and learn from other's mistakes and preferences.
I will take this opportunity to encourage you to open your mind
and investigate silver's outlook. You may be overlooking one
of the best possible investments for the future.
And lastly, I am not talking my silver book, as you implied. My
portfolio is diversified amongst Gold; Platintum; Palladium;
and Silver, in proportion to those listed order. Silver is least,
but I have recently begun shifting more towards it.
You have every right to feel:
[quote]
your commentary is always misleading and today was no different.
[unquote]
And I have every right to post herein, that which I feel may be
of interest to someone, anyone, looking for varied viewpoints.
Afterall, isn't that why *all* of us visit here so frequently.?.
You are confusing my often-contrarian viewpoints as nefarious
attempts to "mislead" others. Were I inclined to do so, I'd find
much subtler prose to accomplish such deceit. Trust me.
Meanwhile, just be content knowing that my opinions which I
express in this Forum are meant to enliven discussion, and
expand the concepts and thinking of everyone here, to the
benefit of whomsover chooses to contemplate such diversity.
I look forward to your "GOLD blows right through $2000/oz".
And wish it as soon as possible for you. Please give us your
opinion of what silver will be priced at upon that same day.
""CMRM entails immediate and aggressive action, with the old stalwart Goldman Sachs leading the charge. The firm takes a major leveraged position in Fannie Mae Long-Term Debt Securities to the tune of $50 billion. Since these are top-rated securities, this transaction is easily consummated by Goldman borrowing $50 billion in the money market (from the Money Market Fund using Fannie Mae Securities as collateral � a "repurchase agreement"). These "funds" are used to purchase $50 billion of the Household Sector's Fannie Mae Long-Term Debt Securities, held on account at Goldman Sachs. The $50 billion of proceeds are instantly deposited (electronic journal entry!) into the Money Market Funds on behalf of the client, the (now much more "liquid") Household Sector. In this case, Goldman's balance sheet increases by $50 billion to $250 billion, with Holdings of Long-Term Fannie Mae Securities increasing $50 billion (to $250 billion) and Borrowings from Money Market Fund ("Repo") also increasing $50 billion (to $250 billion). Total Household Sector Assets remain the same at $1.1 trillion. While Holdings of Fannie Mae Long-Term Debt Securities were reduced by $50 billion (to $50 billion), Money Market Fund Deposits increased $50 billion (to $450 billion). Through this leveraged transaction (an increase in financial sector liabilities/an expansion of financial credit!), Money Market Fund assets (broad money supply!) actually increased by $50 billion to $450 billion, with $250 billion of Holdings of Goldman Sach's Commercial Paper ("Repo") and $200 billion of Fannie Mae Commercial Paper. Money Market Fund liabilities "Deposits Owed to Household Sector" increased by $50 billion to $450 billion. Hopefully, this illustrates how financial sector leveraging increases so-called "liquidity," or the money supply."
---------------------------------------------------------
Not a criticism of you Steve but it's my belief that those that write stuff like this hope that nobody actually attempts to plow through it and that readers simply accept it's conclusions. Anybody here on the USAG Forum, take a few minutes with this and explain it to me because it certainly does not make any sense,
money market vs Money Market Fund? whos fund? who is "the client". If there is a point to this article Mr. Noland does a great job of hiding it. "Hopefully this illustrates" my foot!!
Part of the World Gold Council's advertising campaign featuring Darcey Bussell.
HARRY DAY
Eastern Daily Press
January 1, 2001
Millions of dollars are being ploughed into a worldwide campaign aimed at sparking a 21st century gold rush by persuading investors to bank on bullion.
The World Gold Council (WGC) is backing its campaign with "several million dollars" � double its previous outlay � in a bid to encourage both institutional and private investors in Europe and the Far East to include gold in their portfolios.
Institutions can invest in gold by buying coins or gold bars � standard 400 ounce "London good delivery" bars are just over �73,000 apiece � which are kept for them by a bullion bank such as HSBC.
But private investors are more likely to buy jewellery, gold coins � UK gold sovereigns, Australian Nuggets, South African Krugerrands, Austrian Philharmonics � or small gold bars.
Indeed gold coin sales in the euro area, encouraged by the removal of Vat on January 1, rose by 29pc � from 4.4 tonnes of gold to 5.7 tonnes � in the first nine months of 2000 compared with the same period last year And there seems to be something to suit every pocket.
One Blackpool-based dealer was last week offering Australian gold nuggets over the internet costing from �50 for a tenth of an ounce to �215 for an ounce. The same dealer was offering year 2000 gold sovereigns for �65 with discounts of 13pc for bulk orders of 500.
The market price of gold at the time these figures were quoted was �183 an ounce so there is clearly a mark-up on the coins suggesting bars might be a better prospect.
At market prices a gold bar weighing a kilo would set you back just under �6000 and a small gold bar, called a 10 tola can be had on the open market for approaching �700.
But gold investment is not that simple.
Prices are always quoted in US dollars and fluctuations in the dollar against other currencies could turn a rock solid investment into fools� gold.
For example, the third quarter of this year saw the gold price fall in US dollar terms, but actually increase by 16pc in sterling and by 23pc in euros, compared with the same period last year.
The reverse could apply.
Stockbroker Richard Larner at the Norwich office of Hill Osborne said gold investment did have some advantages over shares � no management fees and good to look at.
There were also limitations.
Mr Larner said: "In the past gold has only come to the fore when there's been high inflation and we don't have any signs of high inflation at the moment. It didn't really pick up in the 80s when interest rates went up but it was really successful in the 70s when we had high rates of inflation."
Jeremy Charles, gold dealer at HSBC, said the market had been relatively quiet during the year with prices remaining in the $262 to $290 an ounce range.
WORLD GOLD COUNCIL
end
----------------------------------------------------------
Trail Guide -- absolutely, take only the time you have available. How can we all make the best use of it? You have been so generous in the past, so I have three suggestions:
(1) We all re-read the Trail (so much has happened to confirm, or raise questions) so we're all "on the same page", and
(2) Questions specifically to TrailGuide are posted in a specific place (new page?) for you to get them most easily, unless, of course, you're having someone search each day's posts or previous day's archives. Maybe that's OK for you already?
(3) Be willing to write: "I think I've covered that one before,... but here's a new twist on that..." and just give us the quick take. But now I'm recalling that your writing style is one where you get pretty deep into the flow of your thoughts and experiences when you post a Trail message, or answer a bunch of questions... Maybe that's what it takes for us to get your best stuff, so that just means doing it less frequently, unfortunately.
But even just popping in for a quick hello, and maybe a couple clues or hints or articles dropped can keep us moving. If this is an alteration of your project with ANOTHER, can you tell us? Or if solely your personal time limits, we'll understand. You can't do any better than your best, so don't hold back trying to perfect it...
DEBT
All the discussions about a collapse assume that AG will be trying for a soft landing, trying to unwind derivatives slowly and leaning against another LTCM collapse. But things have gone on so much further, one analysis must be coming through to his and GWB's desks that a fast, deep debt unwinding would avoid a Japan meltdown followed by 10 years of the "walking dead."
I would suppose that under this scenario that the big firms are jockeying for survivorship. Might all the losing positions be being offloaded onto such as the JPM/Chase (now completed) derivatives Goliath, or the offshore "funding corps" that aggregated credit card debts, etc.? Even Fannie Mae/Freddie Mac.
You notice how a spate of bad earnings reports lets all of them off the hook to let out bad news? Like writing off "nonrecurring losses" so they'll look better in future reports. What about if their was going to be a big one-time debt meltdown? Why would anyone MISS the opportunity to load up their designated debt donkey and send him on outa town carrying all the firm's liabilities?
All the "chosen ones" would be moving their net worths toward safe havens, ready to net out their remaining losses. Their solvency will allow them to keep their long-term debt in current payments, and to buy up the losers' assets at firesale prices.
What kinds of signals would we look for that an awareness of this impending crash is part of strategy at the top, and that, instead of "Y2K warrooms", they now have "Plunge Protection Warrooms"? Oro?
It might be something as arcane as knowing which Treasury security dealers are keeping their repos going with certain others, or closing them out. Areas so far from my/our experience...
Gold Miners That Go Belly-Up, Abby Jo, and a Couple of Oil Slicks
I have read about how many mining companies have slashed exploration budgets. Those are the mining companies that are running scared. Profitable miners have actually increased exploration budgets. Harmony Gold for example is pushing ahead with increased exploration. Meanwhile, other hedged miners are eating out of their hedge books and high-grading their ore deposits in a desperate attempt to either remain "profitable" or at least survive for some reason. They have slashed exploration budgets because they simply can't afford it. Check into the companies annual reports and see which companies have cut exploration and development budgets � those are the ones to bail out of. Check to see which are living off of their hedge books � sell those too. Check the bottom line and see which ones are not profitable � sell those too. That leaves only a handful of miners. When the price of gold rebounds � look out, most forward sold miners are toast � refer to Ashanti (ASL) and Cambior (CBJ). You see, without exploration and high-grading ore, there is no future for that company � they're toast! Forward sold miners rely on gold prices to decline � rather curious for a gold company � yes? When the POG eventually rises � those companies are toast! An interesting note on those companies that are eating out their hedges � those contracts are running out. They have helped to depress the POG. Now any forward contracts available are also at much lower prices. These ever declining lower priced forward contracts are converging with the lower physical price of gold. Those companies who rely on higher gold prices will have to go belly up when the current forward contracts are filled. There simply are no more higher priced forward contracts available. It's "catch-22" � "Damned if you do, and damned if you don't" Feel no pity for them, they sowed the seeds of their own destruction. No exploration for higher grade deposits that can be mined cheaply? Then die on the vine as it were. Pick gold shares very carefully and then only profitable unhedged miners that have plans for growth. Also, watch the lawsuit of Ashanti Shareholders against the companies officers � take note Barrick (ABX) and AngloGold (AU). Also, Cambior only got a temporary reprieve, as they now are shedding off assets faster than a stripper on speed!
Well we made it into 2001. I see that Abby Jo Cohen's predictions came up short. No S&P at 1450, and no DOW at 11500. I thought for sure they would trot out the old girl to talk up the market for a year end push.
An interesting table of petroleum stats came to my attention. I thought they were somewhat entertaining, as the US is becoming more dependent on petroleum � especially natural gas. From the Division of Professional Affairs Energy Statistics, AAPG:
Petroleum Demand 1999 World 74.8 Mbbl/day US 19.52 Mbbl/day
Total US Energy Consumption (EIA) 1998:
Petroleum 40.7% Natural Gas 24.1% Coal 23.3% Nuclear 7.9% Hydro 3.8% Other 0.2%
US Electric Supply (EIA) 1999:
Coal 50.6% Nuclear 19.6% Natural Gas 15% Hydro 8.3% Petroleum 3.8% Geothermal-Solar-Wind 2.4% Other Gas Fuels 0.3%
BTW, OPEC meets on January 17th, to cut oil production and exports. The size of the cuts could determine whether supply becomes a problem. However, it was never a problem with supply as much as a problem with refinery capacity. We are in a "Dead Zone" now. Present supplies are filling the gaps for current needs, but as the so-called "driving Season" gets under way and refinery capacity comes under renewed pressure � lookout. Remember last summers high gas prices and calls for government investigations by Grasshoppers everywhere? Look for a repeat!
Gold is up slightly +$1.70, and Silver up +$0.03. Hang Seng gets clipped for over 225 points in overnight action. NG is off -$0.67 at $9.10 Mbtu as the little snow flurry on the east coast passes. However, winter is far from over and it looks to be cold this year, all the while NG storage is drawn down to record low levels. We are really cutting this one close!
http://www.mrci.com/qpnight.htmFutures look sharply lower tonight. The theory of the market in January is that "As goes January - so goes the year." This could be interesting if January craters. Could be a last chance to acquire gold and silver at bargain basement - fire sale prices. This could get rather fun. BTW, Gold up +$1.80, but still clawing back from getting ambushed last week.
Gold back to coma status, but the Euro is much stronger - up 0.52 at 94.80, and USD index is lower -0.26 at 109.02. Futures are all lower except the NASDAQ futures. Looks like a confused market for the first trading day of 2001. Gold demand is looking better, as gold is politically correct again. It appears that gold clothing and bold gold jewelry to match is in fashion according to a recent WSJ article and the WGC. A shift in sentiment could signal a shift among investors as well. We shall have to wiat and see. Petroleum is higher, though NG is plummeting below $9.00 Mbtu, in spite of record low storage levels, lack of additional drill rigs, and political opposition to increased drilling. The Grasshoppers are looking to steal from the ants by using their political muscle. Should get entertaining as regional neighbors and NG producers continue to resist.
It is complicated. The point of that paragraph is that credit is being created using Fannie Mae instead of the fed, increasing liquidity in the housing loan market, which raises real estate prices. Later in the same article he mentions buying Microsoft shares, which heretofore had gone up (until recently).
Bottomline. Interesting article with periods of great concentration required. Good graphs though. Other times it is clear as a bell. SO, best to plow through the whole thing as he tries to explain the question you asked.
This morning, CNBC did a piece about the emerging Europe and the place where the money is flowing now. Bond Debt was at 88Billion euros, up from last year where the said it was -44 billion in outflows (whatever that meant). 9% unemployment though.
Did you read the ORO piece re: the euro and Europe? Back a couple of days ago.
Steve H, I saw this article just before visiting the forum.
"George Soros, the currency speculator who earned the title of 'the man who broke the Bank of England', has warned that a new global financial crisis is inevitable."
This afternoon we should know about refinery utilization rates as the API inventory numbers should come out today. These numbers are released on tuesday afternoons - sounds like an old Moody Blues song doesn't it? Anyway, with the long New Year's weekend, it could be delayed. We are approaching a slow-down period in oil, yet on the 17th of this month OPEC meets to slash output. The refinery capacity problem will likely rear it's ugly head again as we approach summer with increased demand for distillates such as gasoline and diesel.
Two years after its launch, the euro celebrated its birthday on a healthy note on Tuesday morning, reaching a five-month high against the dollar and a 10-month high against the yen. The gains were fuelled by continued worries about the US and Japanese economies. The rally came as Greece joined the euro-zone as its twelfth member. The euro reached a high of $94.76 against the dollar, Y108.75 against the yen and �0.6347 against the pound. By 1030 GMT, the euro was trading at $94.45 against the dollar, Y108.50 against the yen and �0.6335 against the pound. Euro-zone officials played a part in the positive sentiment, with Jean-Claude Trichet, governor of the Bank of Franc, saying in a radio interview that he expected euro-zone countries to reach economic growth of around three percent in 2001 without inflationary pressures. Hans-Juergen Koebnick, a Bundesbank council member, said that the euro was still undervalued that parity with the dollar was a realistic value.
The euro's strength flew in the face of unexpectedly weak December euro-zone Purchasing Managers' Index data. The index fell for the eighth successive month to its lowest since June 1999. "At 53.4, the index is consistent with roughly 2 per cent annualised industrial production growth, compared with the current 4 per cent rate," said Robert Prior at HSBC in London. "It is certainly possible that the euro-zone will see an industrial recession later this year as the world trade cycle continues to weaken and the recent sharp rise in the euro starts to bite."
Black Blade: The USD looks to continue weaker against the Euro. Bush appears to favor a weaker dollar - we shall see. Looks like Dim Wim can't even scuttle the Euro this time.
http://www.financialsense.com/series2/tactics1.htmThere is NO possibility that Dollar + Debt, make any kind of soft landing. We don't need another, Plaza-plot to replay the 1985-1995 dollar-decline. The wealth-spiral + easy money + expectations, "metastase", has invaded the complete financial / economic, body.
You can't turn an oil-tanker at full speed. Day after day...I understand more and more...the "vital" and utmost importance of a declining POG ! Don't give POG a chance to develop any increasing price-trend. This event, would attract all financial bees to this honeypot.
A strong dollar has never be so important to the whole economic world. Everybody is benefitting from every side of that strong dollar. But, the stronger the dollar gets...the heavier the Debt-increase. Catch 22 !
Today, the Euro climbs against US$ + Yen. POG is masking again the signal. 273,50$ >>> 271,85
US$-index : 118,45 >>> 109 = minus 8% and POG goes down !?
I repeat my 2 cents suggestion. Hidden agenda of 1 US$ = 1 Euro = 100 Yen ?? Result : a possible stop of distorting currency-war and a pauze for the other currencies to find their balance against the giants. Conditio sine qua non is a stable POG with downwards bias. Shock-Prevention-Operation. ?
Slow decrease in Derivatives and gentle expiration of expiry dates.
They give it a try to prevent the Debt-Eplosion, by using "reason", rather than "emotion". Sorry, folks...but this never worked out as planned.
POO - Behaviour, for the last 2 years, must have been subjected to enormous derivative-forces too. The last 5 years were a Carnival-masquerade, where the paper derivative masks have been hiding the real face of any valuables and debts.
IMO, the financial Titanic is made out of pure paper. If there is no iceberg...the paper will weaken anyway...over time, and sink of course. The "crash" - word will only appear at the end, when the capitulation phase sets in.
That's how I keep on explaining POG's weakness and lacq of signal.
Thanks to Financial Sense for broadening the insights.
http://uk.biz.yahoo.com/010102/80/aubg6.htmlEuro seen set for turbulent ascent to dlr parity
By Sabrina Ghani
LONDON, Jan 2 (Reuters) - The euro is poised to reclaim dollar parity this year, but the single currency is set for a bumpy ride because of currency option barriers along the way, options traders said on Tuesday.
The single currency entered the new year on a buoyant note after breaching an array of key chart barriers against the dollar last year on the back of growing optimism that euro zone growth would slow at a more gentle pace than the United States'. While chartists said there was little in the way of technically significant resistance levels that could turn the euro's fortunes, options traders say the euro bulls might be frustrated as defenders of currency barriers sell the euro each time it heads toward a round number.
"Knock-outs will slow down intraday and short-term spot movement and make the euro's rise a little tricky," said an options trader at a Japanese bank in London.
"But it will not change the whole longer term trend, unless real flows into the euro turn around."
Large barriers, or knock-out options, with strike prices ranging from $0.95 all the way to parity and above are in the market and would be rendered worthless once the strike price is hit, traders said.
But traders add that these barriers would only cause short-term hiccups in the euro's climb, as the long-term trend firmly favours the euro. In fact, they added that once these options barriers are taken out, the holders of these options become euro buyers, helping to accelerate the euro's ascent.
"Option barriers are like icebergs, they come and go," said a trader at a European bank.
NEXT STOP $0.97
The euro hit five-month highs around $0.9476 on Tuesday, some 5.5 percent short of parity.
Chartists said the next technical resistance comes in at around $0.97 and the worst that can happen when the euro reaches this level is that it trades sideways for a few days or stages a minor pullback before heading higher.
"A lot of work has been done already and the euro's trend is extremely impressive," said Brian Kiely, senior technical strategist at Royal Bank of Scotland (LSE: RBOS.L - news) Financial Markets.
"Our focus now is parity and $1.03, which we might even see in the next two months." Expectations that the euro will reach parity against the dollar have seen demand for euro call options, the right to buy euros, with a strike price of $1.00, particularly in maturities beyond three months, traders said.
Furthermore, investors are willing to pay a higher premium for euro calls over euro puts, the right to sell euros.
The premium, reflected in one-month risk reversals, hit its highest levels on Tuesday in more than a year, when the euro was trading above parity.
"Risk reversals have flipped all the way and even favour euro calls in one year, so we can say that the sentiment has turned well bid for the euro and people are more convinced that the euro is going higher than they were two months ago," said the Japanese bank trader
http://www.kitco.com/charts/livegold.html Evidence of POG in a dirty street fight this morning at the link above. Looks like London was loosing control. New York, well, looks like the battle got mean. After wild gyrations overnight, POG dropped about $4 in a couple hours in New York.
Yes sir, Hydro-Carbon man is in for more whacks. A little reprieve on the oil front (watching the NG scramble) until the spring when oil will be back front and centre.
Forty dollar oil predicted for the winter may just be delayed a few months.
"George Soros, the currency speculator who earned the title of 'the man who broke the Bank of England', has warned that a new global financial crisis is inevitable."
Well, he should know, he's the guy who brings about the crisis' in everybody's backyard but his own. As they say -dogs do not sh*t on their own doorstep.
Gold whacked?- though most gold stocks are up substantially!
Must come as a shock to the PPT that this blatant suppression of POG doesn't translate to lower gold stocks, or else, do more investors leave the tanking SM's to take cover in PM stocks? ... the physical will follow suit, as it did in early 1993.
I do understand that some of our hero's like, mostly unhedged NEM and others are under severe cash restraints - they still are my favourites, due to their perseverance not to hedge, though I hear Ron Cambre is on his way out (a great loss for the co.), but as a shareholder (meaningful for me!) I still feel this miner is one of the best in NA and I would fight any attempt of takeover by the l(y-)ikes of predatory ABX's and their Mo-(u)nkey ilks.
So fight the good fight for free markets and go gold and GATA (to quote YGM)and don't let the derivative paper game stand in your way of acquiring reality, physical and some unencumbered miners. cb2
what i see now on kitco chartsis laughing at my face
is cynical and prevers
is showing "i am the stongest"
and I begin to believe that "they" are the strongest
Signs of the times: Indeed hydrocarbon man is in for problems @Black Blade, ALL
If we continue to have a cold winter, it's possible that in certain
areas of the country, we will have to shut everything down except
hospitals and residences. This is a very real possibility. ... In
no time in the the last 30 years has OPEC cut oil production when
prices were this high. It's troubling that it's being done by Saudi
Arabia, our friends -- but they're up against the declining production
of their "mature" oil fields, so it's understandable. -Jerry Castellini,
Chief Investment Officer CastleArk Mgmt. Pres., CNBC, Jan. 2, 2001, 11:32AM EST
Regards, j.
P.S. The market will adjust -- we'll use less -- and alternative sources WILL be developed. People will change and adapt. That's what free markets facilitate extremely well. And we'll do it quicker if the bumbling nincompoops (you know which ones I mean) keep their inept "fingers" and kleptomaniac tendancies completely OUT of the energy business. And I mean COMPLETELY.
Signs of the times: Institutions dumping US equities, especially financials, apparently @Trail Guide, ORO, ALL
3/4 of all trades in GE & EMC today have been block trades, over 10,000
shares, which is considered a sign of institutional activity. These trades
have been sells, indicating institutions are getting out of a stock. NYSE
trades like these have been increasing over the last few weeks, and today
they have hit EMC & GE. -Bob Pisani, CNBC, Jan. 01, 2001, 11:40AM EST
You've got it wrong this time @Pandagold (1/2/2001; 9:13:24MT - usagold.com msg#: 44865)
Hi Panda!
I don't usually disagree with you -- but I do on the above post.
I'm not a Soros fan, but he doesn't cause the problems, he and his brethern just take advantage of untennable economic conditions caused by government-bankster paper/megabyte fiat money junkies who don't heed the lessons of monetary history.
To be a bit more clear: The government and banker screw-ups are the cretins that, as usual, cause the problems. Soros causes the problems exactly the way wet cobble-stones cause rain.
Would be interested to hear your opinion on Harmonys recent claim to hedge (the properties they bought from Anglogold must be hedged for capital reasons it was said.Banks named in the deal were 2 SA's I think and,guess it, Chase!).It shocked me when I read that,don't have the link anymore unfortunately.It is not time to hedge,it is time to close them at this prices.
Hi..I'm just wondering what everone's take is on the news of China selling more silver into the market this year. There was a news article about it on Kitco a few weeks back. Does anyone remember it? (Sorry I don't have a link)
Does anyone know if the analysts that have been writing commentaries about the short supply of silver have taken into account what the Chinese did in 2000 and what they are planning on doing in 2001? The article said something about only two silver mining companies had quotas to sell into the market for 2000 but in 2001 they were going to allow 8 more with a total of up to 40m ounces possibly coming into the market this year. This news along with Kodak already being hedged for 2001 seems to be really bad news for silver as a whole, unless of course something major happens that no one is considering at this point.
Sorry for being so vague here but I couldn't find the article again on Kitco.
Hope some of you can shed some light on this. Thanks..Magnison
After a particularly volatile report on U.S. Treasury bonds by bond reporter
Rick Santelli - - - Ted David: "It's like Las Vegas, isn't it Rick. Rick
Santelli: "Yes it is, Ted." -CNBC, Jan. 2, 2001, 2:44PM EST
Vatican Adopts EURO as Official Vatican Currency......
Hopefully the Coinage will be AU & AG......THE Vatican and Italy yesterday signed a convention enabling the Holy See to adopt the euro as its official currency and to mint its own euro coins.
Diplomats said the agreement had been required in order to bring Vatican City - whose official currency is the lira - into line with Italy's commitment to adopt the euro on January 2, 2002.
Under yesterday's terms, the Vatican will license Italy's Treasury to mint euros on its behalf, just as Vatican lire are struck at present. Vatican coins are legal tender now both in Vatican City and Italy.
Similarly, Vatican euros will be able to circulate freely throughout the entire euro zone, the Foreign Ministry in Rome said. Vatican euros will resemble those of euro zone countries, with the Holy See able to choose its own form of "national" illustration on one side of its coins.
There was no official mention yesterday of what this might entail, but sources said the most likely choice was either the Keys of St Peter, or the head of Pope John Paul II.
17 December 2000: Police fire tear-gas as Haider meets Pope
Nope! Not wrong. You have been duped by his rhetoric he uses to 'explain' his currency attacks', and soothe his conscience for the misery he causes. You have also misread my posting.
All governments have a screwed up currency (some worse than others). But the biggest of all is the US. Soros hit the Asian currencies after they had been lured into playing follow my leader (the US.)
This pre-planned attack by Soros( the Cabal's elite panzer division) brought down the Asian economies when they were at the most vunerable. Result - the assault troops moved in snapping up property, prime businesses - in particular financial institutions at knocked down prices with US monopoly money.
Meanwhile the dollar gets away with murder as it goes on a rampage. Why doesn't Soros punish the 'financial junkies' here? (rhetorical question)
Get wise my dear friend. See the whole picture. Is there a relationship between the Falklands war, the Gulf war, The Balkan war? Lets go farther back - the French Revolution, the Russian revolution - any connection? Search it out. There is a fine thread which runs through all these (and more) incidents. But we have been brained-washed into seeeing them as unrelated. VERY LITTLE of major importance is unrelated, nor unplanned well in advance.
The oft' overlooked importance of 'grass roots'...
From the linked article: "The euro is making up some lost ground in public opinion according a survey released by Canal-Ipsos of France just before Christmas."
---
Additionally in euro news, the ESCB and its consolidated reserves were swollen futher over the holiday weekend as Greece officially joined the monetary union, setting aside the drachma as a legacy currency at the fixed rate of GDR340.750 per 1 euro. Euro notes and coins will replace the 12 national legacy currencies for use in circulation during the first few months of 2002.
BEGINNING OF THE END FOR CASH
" It could prove to be the death knell of notes and coins.
Singapore is to phase in e-money and force all
businesses to accept it as legal tender by 2008.
Financial transactions will be made using money
Stored on computer chips.
Cash will be a thing of the past as money changes
hands electronically using digital pulses transferred
through mobile phones., hand held computers and even
watches.
A shopper will be able to point a mobile phone at an
item to register the price. The phone would check the
shopper's bank balance on the internet and deduct
the money from the account if it was told to buy the
item.
��������."The physical notes and coins
will be a thing of the past "says Lo Siang Kok
currency director at Singapore's Board of Commissioners
of Currency. "There's no point in fighting technology"
Sweden wants EU to �harmonize� tax laws throughout Europe
THE Tories are claiming to have more proof that Brussels is committed to a "superstate agenda". Francis Maude, shadow foreign secretary, said yesterday that plans to harmonize taxes were being actively promoted.
European leaders cheer Euro's newfound prosperity
European leaders celebrated the sudden revival of the single currency on the markets over the New Year, which raised the prospect of a successful switch to euro notes and coins next year.
Criminals counterfeiting euro currency
Criminals are planning to cash in on the launch of euro notes and coins, by flooding the Continent with fake currency, the head of an anti-fraud agency said last night.
Greece abandons national currency and surrenders to growing euro
Greece has become the twelfth country to join the European single currency, ditching its own currency, the drachma.
Euro is only EU success in 10 years says former German chancellor
Helmut Schmidt, the former German chancellor, yesterday attacked the European Union for having achieved nothing in the past 10 years except for the creation of the euro.
Sweden takes over presidency of European Union after �French fiasco�
Sweden has taken over the six-month presidency of the European Union, saying it plans to focus on three main issues - the EU's eastern expansion, new employment guidelines and environmental protection.
�French fiasco� comes to end as France turns EU presidency over to Sweden
France prepares to hand over management of the European Union to Sweden this week after a bungled turn in the rotating presidency that has dealt a heavy blow to French influence in Europe.
Libyan dictator says Great Britain is slowing down European superstate vision
Colonel Gaddafi will criticize Britain today for slowing the pace of European integration.
Everyone sees things a little differently. Take this for what it's worth- as educational or amusing. I offer it but no judgment of it.
Rich
[B] NY Precious Metals Review: Feb gold falls $3.6 on technicals
2-Jan-2001 20:58:48
By Darcy Keith, BridgeNews
New York--Jan. 2--COMEX Feb gold futures, defying the usual market guidance
of the euro and equities, tumbled Tuesday to their lowest level in a month as
weak longs dumped the metal on technical pressures and several rounds of sell
stops. Feb settled down $3.6 at $270.0 an ounce after hitting a low of $269.0
late in the session. Mar silver, pressured by gold's slide, settled down 4.0
cents at $4.595 after hitting a fresh contract low of $4.590.
* * *
Gold players were left scratching their heads on the first trading session
of the year, as the euro was stronger Tuesday and equities much weaker, market
movements that typically would spur higher gold prices.
While dealers and analysts appeared to have no obvious explanation for the
move, most linked it to much weaker-than-expected U.S. manufacturing data
released at 1000 ET, prior to much of the heavy selling.
The National Association of Purchasing Management said its index of
economic activity was at 43.7 in December from 47.7 in November, much lower
than 47.0 that economists had forecast. The December reading was the lowest
since April 1991.
This key barometer of the health of the U.S. manufacturing economy was down
for the fifth month in a row. Technically, the manufacturing sector would be in
a recession if this index remains below 50.0 for two quarters or six straight
months. ( Story .4792 )
This, according to some dealers, spurred talk of deflation on trading
desks, a scenario which would certainly not help gold, sometimes used as a
hedge against inflation.
"Gold is really a very good barometer of deflation, and everybody,
including Greenspan, looks at deflation," commented one dealer.
Of course, gold did not benefit much from signs of inflation during the
first three quarters of last year, so why players are so concerned about
deflation leaves some question mark surrounding that theory.
Leonard Kaplan, president of Prospector Asset Management in Chicago,
suggested that one rationale is that the NAPM figures clearly point to a
recession, and if one assumes precious metals are industrial in nature and
dependent on economic growth, it would make sense that demand will be
weakening.
But Kaplan admits this rationale doesn't totally explain gold's move, given
that precious metals are not entirely industrial in nature and inflation
worries did little to spur buying interest last year.
"It seems like the New Year has brought us nothing but highly confusing
markets," said Kaplan. "One would have thought that the currencies would be
dominating the action. Today is an extreme aberration."
A variety of sellers were seen Tuesday, including the funds and the trade,
with a large cluster of stops taken out at $270.30, said dealers.
One trader said Tuesday's action suggests that while gold has been
following movements in the currencies lately, the dollar may not be a long-term
determinant of gold prices. "On a long-term basis, it may be nothing to hold a
hat on," he said.
The trader added that technical selling was a key factor Tuesday, as
several support lines were taken out.
Kaplan noted that gold slipped through support in the Feb contract at
$271.2 "like a hot knife in butter," and pegged support at $269.2, just above
Tuesday's low of $269.0. Next support is found at $268 and $265, said Kaplan.
Silver saw trade selling interest Tuesday, as prices came under pressure
from gold's weight. Silver's low Tuesday was its lowest level in 13 months on
continuation charts.
SETTLEMENT PRICES
--Feb gold (GCG1) at $270.0, dn $3.6; RANGE: $269.0-275.0
--Mar silver (SIH1) at $4.595, dn 4.0c; RANGE: $4.590-4.650
--Jan platinum (PLF1) at $608.9, dn $0.8; RANGE: $604.5-611.0
--Mar palladium (PAH1) at $968.5, up $14.05; RANGE: $964.0-968.5
SPOT PRECIOUS METALS PRICES:
New York 1514 ET London 1130 GMT Tokyo 0600 GMT
Gold(KRCGL) 271.20-271.80 273.25-273.75 272.75-273.25
Silver(KRCSL) 4.57-4.59 4.60-4.62 4.59-4.61
Platinum(KRCPL) 608.00-614.00 602.00-612.00 605.00-615.00
Palladium(KRCPA) 963.00-983.00 940.00-960.00 940.00-960.00 End
For an intraday chart of active-contract gold, double-click:
Media://analytics/pages:active-gold-intraday:/cmd=us@gc.1[1099ID;3;2] For
an intraday chart of active-contract silver, double-click:
Media://analytics/pages:active-silver-intraday:/cmd=us@si.1[1099ID;3;2] For
an intraday chart of active-contract platinum, double-click:
Media://analytics/pages:active-platinum-intraday:/cmd=us@pl.1[1099ID;3;2]
For an intraday chart of active-contract palladium, double-click:
Media://analytics/pages:active-palladium-intraday:/cmd=us@pa.1[1099ID;3;2]
[End BridgeLinks]
Copyright 2000 Bridge Information Systems Inc. All rights reserved.
I have posted this before, I know, but eventually it will sink in.
"Dollar,Euro,Gold - the Three Cabilleros
We are in a transition from the dollar to the Euro (at least for some time). This should be obvious already to the discerning, but if it isn't, it will be as the new year progresses.
This is not Europe fighting the US. It was planned many moons ago (all part of the agenda).
It should be remembered that it is a transition from the old well-tried, to the new boy on the block. During any transition the situation is tenuous and sensitive. Also, because of the whole manipulated financial structure, we have a severe aggravated situation, that, if things went wrong, would topple the whole pack of cards.
If, once the dollar weakens, money were to flow into gold instead of the Euro we would have a worst case scenario, and this is why TPTB will enure that it does not.
Once the Euro is up and running, and steady on its feet, then, and only then, will the tight reins on gold be relaxed.
This, of course, does not mean that gold could not move some, but it is so far down at the moment - $10 would seem like a major event and get everyone excited. It could even go to $300 without doing much damage. But, as stated, there will be no major move (if ever) UNTIL THE EURO IS WELL ESTABLISHED. No one would be happier than I if it did, but it is not in the agenda.
Pandagold (usagold.com msg#: 44878) . . . "End of cash"
Excellent article. I can think of very few real-world examples that so clearly demonstrate to thinking men that "wealth" and "currency" are NOT to be confused and equated, as they are so clearly not the same thing. One need only to imagine a lost confidence (as we have seen in the purchasing power of "dot.com stock" as a form of intermediate quasi-currency, or the failure of many third-word currencies) or a power outage to render a person's savings into nothing at all. In truth, as things currently stand there is not much separating paper from digital currency as proposed. Let us hope that most people with money to lose have not forgotten the timelessness and durability of hard assets to denominate/represent their accumulated worldly wealth.
*UN dictates all Member Nations to focus on control of Black Marketing in Cash and Gold/Silver for goods.
*BIS, World Bank, IMF, US Fed Reserve, Vatican,and many other intitutions support Electronic Money laws and want all Gold and Silver to be held in trust accounts by proper
authorities.
*Gun control laws thru late 90's and early 2000 seemingly having little to no effect on crime rates. Now only the
"Bad Guys" have guns.
*The Market Crash of 2001 seems to be taking years to rebound as it did back in 1929. (25 years for it then to return to full value)
*Prophets and Seers alike watching very closely as Mallachy's last predicted Pope takes over.
*Ex-President Clinton dying of Aids related complications in Jail. Hillary doesn't want to visit and prefers to stay in her solitary confinement cell. More treason/murder charges still pending against both Clintons.
*US Treasury Agents to-date have recovered over 1000 tonnes of Gold and Silver Bullion and Coinage buried by illegal hoarders....Agents claim the new "Hand Held Ground Penetrating Radar Metal Detectors" are thru widespread use locating backyard caches in 10% of property searches. Also finding large stores of weaponry and Ammo...Story developing
*Environmentalists now worry continuing energy crisis is turning World forests into wastelands as people continue to ignore laws restricting tree cutting on private property and public lands. Expecting near term restrictions on wood burning stoves thru out USA and Canada.
*Blah, Blah, Blah.....Story Developing!!!
***I'll leave the guesswork as to War, Plague and the rest of the scenario for 2010 to somebody else.....YGM.
An institutional investor which believes in gold (at least gold shares)
I am not espousing or promoting this bank/trust company, or the gold mining company, but merely illustrating that there are institutional investors which believe gold has a future. Here is the news release:
ARIZONA STAR RESOURCE CORP ("AZS-V;AZSRF-L") - Pan Atlantic Bank and Trust Limited Acquires Arizona Star Shares
Pan Atlantic Bank and Trust Limited, Attention: Mr. Anscele Payne, Managing Director, P.O.B. 982, Musson Building, 3rd Floor, Hincks Street, Bridgetown, Barbados, W.I., acquired through a privately negotiated transaction ownership and control over 3,000,000 common shares of Arizona Star Resource Corp. (the "Company"). Pan Atlantic Bank and Trust Limited, together with any person acting jointly or in concert, now has ownership, control or direction over an aggregate of 12,036,100 common shares (representing approximately 30.31% of the total outstanding common shares) of the Company. Included in these are 20,000 common shares of the Company owned by an employee benefit plan of an affiliate of Pan Atlantic Bank and Trust Limited.
Pan Atlantic Bank and Trust Limited has purchased the shares for investment, and it does not presently have any intention of making additional investments in or dispositions of securities of the Company in the future, but may do so, depending on price, availability and general market conditions. Pan Atlantic Bank and Trust Limited currently intends to remain a passive investor in the Company, and not to influence control or direction of management of the Company, although it may seek board representation. TEL: 1-246-436-9756/7/8
Anscele Payne, Managing Director FAX: 1-246-228-1156
Pan Atlantic Bank & Trust Limited E-Mail: pabt@caribsurf.com
http://www.sightings.com/general6/cowup.htmPrions in Cattle and Food chain thru feeding animal protein to animals and fertilizing with human waste is a subject yet to become news for most....I don't even want to think of 2010 and BSE.....Aids will pale by comparison...IMHO
Like the Ad said..."You Can't Fool w/ Mother Nature"..YGM
Tower commentary on today's Bridge News "NY Precious Metals Review"
"New York--Jan. 2--COMEX Feb gold futures, defying the usual market guidance
of the euro and equities, tumbled Tuesday to their lowest level in a month as
weak longs dumped the metal on technical pressures and several rounds of sell
stops. Feb settled down $3.6 at $270.0 an ounce after hitting a low of $269.0
late in the session."
From my view here in The Tower, I would say that it was the dumping of February futures contracts that caused the pricing downdraft, NOT the dumping of metal as indicated in this report. There is a difference. As only fiduciary representations of wealth, such things as stocks, currency, or derivatives contracts may at times undergo a crisis of confidence, suffering sharp valuation declines.
COMEX gold futures contracts, we must remember, are not hard assets. Rather, they are a leveraged wager on the "sentiment direction" of these very same wagers, determined by the bettors' demand to enter or exit these wagers, NOT the demands on the metal itself. Such is the farce (or blessing if you are buying metal) of the current market method for price discovery for gold.
The article seemed at a loss to explain how an exit of paper gold positions might be quite natural as confidence wanes in paper assets in the wake of floundering stocks after a year of financial punishment in "non-tangible" assets. Again, a futures contract is not a tangible asset. It is not gold, it is just a highly structured gentleman's agreement with rules that are subject to change to favor the "house" as needed. The article said:
--------
"Gold players were left scratching their heads on the first trading session
of the year, as the euro was stronger Tuesday and equities much weaker, market
movements that typically would spur higher gold prices.
While dealers and analysts appeared to have no obvious explanation for the
move, most linked it to much weaker-than-expected U.S. manufacturing data....
""It seems like the New Year has brought us nothing but highly confusing
markets," said Kaplan. "One would have thought that the currencies would be
dominating the action. Today is an extreme aberration."
A variety of sellers were seen Tuesday, including the funds and the trade,
with a large cluster of stops taken out at $270.30, said dealers.
One trader said Tuesday's action suggests that while gold has been
following movements in the currencies lately, the dollar may not be a long-term
determinant of gold prices. "On a long-term basis, it may be nothing to hold a
hat on," he said."
---------
While the traders scratch their heads, here at USAGOLD we have for a long time offered a fresh perspective on the nature of these markets in helping to paint a picture of the road ahead. Today seems a good opportunity to repost this good articulation of thoughts that were offered here on a Friday evening my by good friend, MK. It was a fine encapsulation, and something you should consider passing along to your friends and family. Randy
*****
[BEGIN repost]
USAGOLD (12/15/2000; 9:05:45MT - usagold.com msg#: 43784)
A Note on the Nature of Gold Price Movements. . . .
Where does it say that gold has to react tit for tat to the crumbling dollar? Though gold is regarded as money; it is not used at the moment as currency. Whereas there is a direct relationship between the dollar and the euro in forex markets, there is no such arrangement between gold and the dollar. If gold should go up 1% would the the dollar go down 1%? Not likely, since such a thing has not happened except by pure accident since the switchover to pure fiat money in the early 1970s. Gold broke out in the 1970s when the cartel controlling its dollar price threw in the towel. Why did they throw in the towel? Because the cartel -- in those days known as the London Gold Pool (in which the United States and UK were the primary players) -- refused (or was unable) to supply gold to the DeGaulle led continental Europeans at $35.
Go back and look at the record of gold flows. You will see gold leaving the U.S. Treasury and winding up on the balance sheets of France, Holland, Germany, Italy, et al. Gold, by the way, that for most part remains on those balance sheets today despite the claims to the contrary by the financial press. The London Gold Pool finally gave up lest all the U.S. gold would have wound up in Europe. The cartel was broken. The U.S. then devalued the dollar first in 1971 -- under a Republican I might add -- and then again in 1973. Gold, set free from the Pool went to $200 by 1974, retreated under the strain of IMF and U.S. gold sales through 1976, then resumed its climb after that intervention failed as well (to hold the price between $100 and $150). The gold/dollar correction concluded in the late 1970s at prices quoted so many times I won't quote them again. Make no mistake about it though, the move in the 1970s was nothing more than a correction resulting from the pent up price pressures built up during the London Gold Pool days.
Sound familiar? Do these echoes of the past resonate now?
They should! Though the circumstances and instruments have changed, the effect has remained the same. Gold is being managed covertly now -- as circumstances allow. (Though this time around for a dual purpose, i.e. to protect the gold carry trade as well as the international reputation of the dollar.) In the 1960s gold was being managed overtly -- as circumstances allowed.
I continue to believe that buying gold at $270 today is the equivalent of buying it at $35 in the 1960s, because this cartel will be broken as well and it will be broken by relentless and constant physical demand. Should any in the international scheme of things break ranks -- the Gulf, Japan, Europe -- and begin to sell bonds for gold, that would hasten the push by physical and drive the cartel to the wall in short order. I doubt it will be made public should the move to gold occur; it will just be done.
All the comparisons we see between then and now, all the deja vu's (Energy problems. Worldwide currency turmoil. Money printing. Etc.) are not an accident, but the products of a repetition of the money mistakes of the past. As gold was the messenger needing to be controlled then for political reasons, so it is now (with a twist, i.e. the gold carry trade). The only question is when will the towel fly out of our opponents corner and into the middle of the ring. When it occurs, my belief is that the move will be explosive as it was in the last go around, and as you can see by my constant (and annoying) hinting, bear consequences alluded to here often by our friend, FOA.
What is astonishing to me in discussions with all sorts of people both in my public and private life, how many do not understand that economic cycles play out over a very long period of time. Equity market Bulls can last 10 to 15 years; so can equity market Bears. Gold market Bulls can last 10 to 15 years; so can gold market bears. In my view, the long term paper bull is now ending; the long term gold bull is now beginning.
Too often, we gold advocates labor for understanding using the analytical framework of our opponents. They tell us that this is reality. These are the relationships we should sanction as proofs, when in fact they have little to do with reality. For years, we had to endure the constant mantra from the financial press and the gold shorts that the central banks were on the verge of selling all their gold. It took us awhile to realize that it was the same institutions shorting gold that were telling these tales and they were doing it for a reason (e.g.,the preservation of their very expensive financial hides). That still goes on today.
In fact I caught another whiff of it this morning. Now we are being told that gold hasn't moved against the tanking dollar, therefore gold should be abandoned as a hedge against the potential for another major dollar devaluation. I say, "Absurd. Rubbish. Just what I would expect from a group so immersed in gold short positions that there may not be a way out."
Though there is no doubt that any devaluation in the dollar will affect the price of gold, there is nothing that says that that price movement would be in lock step. I see this morning that others are saying that the Bush administration will move to end the "strong dollar policy." If so, such a policy change will have enormous implications. It is tantamount to what we used to call devaluation.
My Christmas Message: Be patient. Keep an ear to the rail. Develop a philosophy and carry it with you through all your intellectual musings and wanderings. Rely on it much like an article of Faith. This will be your foundation and source of portfolio strength. Continue to acquire physical gold in an orderly fashion. It will be your saving grace.
[END of repost]
4)Gold price gets mugged at NY open (What's new?)- Darnest graph that I have seen in a while.
http://www.kitco.com/charts/livegold.html
5) Further drawdowns in natural gas inventories - I did find the first paragraph somewhat of an understatement.
http://qv3.com/policypete/policypete.htm
6) Manufacturing lowest in almost 10 years - The statement about the service sector (Boy, there's some high paying jobs) seems to be a blatant attempt to soft peddle this problem)
<<- U.S. manufacturing activity fell for the fifth straight month in December, reaching its lowest level in almost a decade, a new report by the National Association of Purchasing Management (NAPM) showed on Tuesday.>>
7)Oil prices surge into new year -
OPEC very likely to reduce production, and summer driving demand not far off -
8) Bankruptcies abound. LTV just being the latest -
<said that it is considering filing voluntary Chapter 11 petitions tomorrow,
December 29, 2000 in federal court in Youngstown, Ohio. The decision whether
to file will be made by the LTV Board of Directors later today.>>
8)Refinery cuts back on production, due to high energy costs.-
Sorry, I couldn't find a link. It is on Downstreamers Forum.
http://pub38.ezboard.com/bdownstreamventures
This is not todays news, but I think we may see more and more of this in the months ahead.
<"We've cut back our runs at the refinery as a result of sky-high power bills," said a spokeswoman.
The company would not say how much it has limited its output at the refinery, which produces mostly for local usage. Industry sources said other refiners in Wyoming and Idaho were also cutting production due to high electricity costs, but company officials were not available for comment.>>
There are many things to occupy ones mind, (providing you lean to the doomer mentality, as I seem to be these days)
nuclear weapons in the Middle East, biological warnings from our government, corporate and personal debt. Oh well, I think this enough for one day.
Oh, did I mention that gold got raped at the NY open? Must have been because of all of the good news, globally.
PS: I slept better, and was more relaxed before Russia became a third world country, and the "Wall" came down.
PSS: I did hear some good news today, although it appears to be a rumor as of the moment, and that is that Saddam so Insane suffered a stroke. I hope that the part of his brain that stores the "launch those babies" order is fried.
Greetings and salutations to all posters and lurkers of the best Gold site on the entire Net........Many thanks to everybody for all the great posts, with a special thanks to FOA/Trailguide for sharing his monumental mental acumen with all of us.....Anyway, I nearly spewed out my coffee this morning as I read.......
GULF COUNTRIES TO CREATE COMMON CURRENCY
Leaders of six oil-rich states Sunday approved steps to issue a unified currency. The move is part of a plan by Saudi Arabia, Kuwait, Oman, Bahrain and the United Arab Emirates for a regional currency and a unified trade zone.
It is designed to help speed up free-trade talks with the regions biggest trading partner, the European Union. Currencies of all the countries, with the exception of Kuwait, are pegged to the U.S. Dollar.
As the old song goes...."Signs, signs, everywhere are signs"........I thought I had read somewhere that top EU officials were in the Mid-East over the weekend....2001 is off to a Golden start....
Jon Kaplan (the cockeyed gold optimist of "Goldmining Outlook")has finally thrown in the towel and sold all his gold shares - so he declares today in his Kaplan Corner.
He was claiming we should buy all we can at these 'knock-down' prices only a few weeks ago.
I never thought I would see the day. He would NEVER accept that gold is being manipulated - we had many verbal 'fights' on the subject.
We are going to start with some Qur'an (from the sura of al--Bakarah) about this matter of riba' (usury):
In the Name of Allah, The Merciful, The Conpasionate:
"Those who devour usury will not arise except as he arises whom Satan has confounded with his touch; this is because they say trade is only like usury. But Allah has permitted trade and forbidden usury.
Those who after receiving admonition from their Lord desist, shall be pardoned for the past; their case is for Allah (to judge). But those who repeat (the offence) are Companions of the Fire; they will abide therein.
Allah will deprive usury of all blessing, but will give increase for deeds of sadaqa: for He loves not creatures ungrateful and bad.
Those who believe and do deeds of goodness and establish prayer and pay the zakat will have their reward with their Lord:
there shall be no fear on them nor shall they sorrow.
O you who believe! Fear Allah and give up what remains of your demand for usury, if you are indeed believers.
If you do not, take notice of war from Allah and His Messenger:
But if you turn back you shall have your capital sums: deal not unjustly and you shall not be dealt with unjustly."
QURAN: 2, 275-279.
I would like to start with a definitive affirmation: only the sufi can break with usury. I say this because only the sufi truly understands that whatever stops him from reaching his Lord must be an illusion. Whatever stops me from getting rid of usury is a self-created illusion. The sufi does not waste time fighting with this illusion, like the economists do -including the so-called "islamic economists"-, he simply ignores it.
Kufr is a system that weakens people. The economical system is a disaster for the people, internally and externally. Our job is not to fight the economical system but to get out of it before its disaster falls on top of us. By getting out of it you are also actively helping in its collapse. In order to do this we have to look at things in a different way: think differently and behave differently. In this, the sufi is the opposite of the economic man. The economic man -the man who lives within the patterns given by the economical system- is trained to think as the absolute observer (subject) who looks out at the world (object). This is the foundation of traditional western philosophy in which modern sciences and economics are based. Within this basis, the economical man thinks that usury is an economical problem with some economical answers. He may question, how can I fight the problem of usury? In this way of questioning it is assumed that usury is something over there, while the person questioning is in plastic bubble isolated from it, but this is not how things are. The questioner is actively participating in usury, what he may consider a problem, and yet, he is part of the problem. He is the problem. Without this recognition you will be fighting your own illusion.
This recognition has an explanation in the knowledge of Ihsan by which we can understand that we are not the observers of the world, we are not the measurers of the world but we are being observed. Allah is observing us. He is the Measurer, not us. Only on this basis can we understand our responsibility, rather than escape from it. Only thus we can become masters of our condition, rather than slaves of our condition.
We understand that nothing stops us from getting rid of usurious practice except ourselves. Then the question "How to fight usury?" should be replaced by "How should we change our behaviour so that we do not need usury anymore?" If we think in this way we are in a better position to suggest proper answers. Nowadays our own behaviour demands the existence of the banks and their monetary system. Therefore if we get rid of the usurious banks but continue to behave in the same way, we will end up again creating a bank. Nothing will change if we call it an "islamic bank". We have to change our behaviour. To do that we have to think differently. And to think differently we have to deny that the main characteristic of man is an economic characteristic. We are not economic units.
We deny what Islam denies. We deny the usurious practices of the modern economy and we deny the way of thinking they call Economics. We deny the banking system and its system of paper-money. We deny the administrative nature of the state.
Paper-money was created by the banks and was first made legal currency only about 200 years ago. Paper-money is not money under Islamic Law. The first condition for any merchandise to be acepted as money is that it has to be commonly accepted. Imam Malik, peace be upon him, defined money in this way:
money is any merchandise commonly accepted as a medium of exchange. Money can be any merchandise as long as it is commonly accepted. When the people were free they (almost) always chose gold and silver. On the other hand the value of paper-money is based on its being imposed on its people by law. Thus you are forced to use dollars in the United States, pesetas in Spain, so-called 'dirhams' in Marocco, francs in France, etc. Many people have already shown that this system of money is a form of cheating.
The modern state is not a structure acceptable in Islam. Islam is based on government by the Law of Allah. The Law of Allah guarantees the right to private ownership of wealth. The state is based on taxation (of trade and wealth) and administration. Economics is the science of the administration of the state. On the other hand, there are no state-taxes in Islam for the free man. Therefore, there is no administration. There is no state. The role of Muslim government is not administration. The only tax in Islam is the zakat, which is collected and distributed in 24 hours among already determined categories of people. Zakat cannot be confused with the state-taxation. The modern state is based on the constitution of the French Revolution, which guarantees the power to impose paper-money (debt-money) and tax its people. Therefore there is no such a thing as 'Islamic state' there is only Islamic Government. It should not be forgotten that in Europe where the modern state was born, many europeans have died attempting to destroy this form of tyranny.
We declare the end of economics based in two affirmations:
commerce without usury, and government without state.
We want to finish with the economics-religion. We have been told that you cannot break this system. But I can tell you that to break this system is easy because is based on illusion. The difficulty is to remain any longer in this system. We have to look at things differently. Let us move out of the economic illusion and look at how things were understood before, within our Islamic tradition.
We go to the "Muwatta" of Imam Malik (the first formulation of Islamic Law) and we look up the book of economics (what some people call iqtisad) and we find that there is not such a thing. What we find is the book of commercial transaction and the book of qirad. This is in itself a discovery. In Islamic Law, justice is to be pursued in the transaction itself. This is ignored by economics that looks at the efficiency of trade as a whole. We say that Justice is the best guarantee of efficiency. We say: "Truth is our Protection". Hasbunallahu wa ni'mal wakil (Allah is enough for me and He is the best of guides). While the economists say: "If it functions efficiently, it is good". The book of qirad introduces us to a complete new landscape that will help us to reconstruct the basis of what became the most advanced and sophisticated formulation of trade throughout the world without usury.
The qirad contract was commonly used in the early times. In its Islamic formulation it transformed, and almost revolutionized trade not only in Muslim lands but also outside it. The formulation of qirad allowed the society to invest its resources, in the context of Equity, rather than being in the ignorance of usurious contracts. Qirad and partnership (they are the two basic formulations of business contract) made finance accesible to everybody without the necessity of an institution of finance (banks or similar). The qirad is not a type of banking practice as it is suggested by 'islamic banking'. Qirad and banking are fundamentally different to the extend that one replace each other. They cannot co-exist. Banking needs a particular usurious environment, namely the imposition of paper-money and kafir law to protect it against popular fury. Qirad needs free people who want justice. Banking, including 'islamic banking', is based on a lie: usury is only like trade. Qirad is based in the practice in the sunna of the Prophet, peace be upon him. Banking institutionalises investment through the bank. In qirad, investment is carried out organically -everybody with everybody- without any central institution. Now we will study the nature of the business contracts in Islamic Law so that we will be able to actively suggest ways of getting out of the banking trap.
Qirad and partnership are guaranteed protection for tall the parties in the contract and they cannot be transformed into banking. The banks hold the money like a monopoly (by means of the permanent devaluation of paper-money, created by them!) and then they distribute it, not to the best business but to the best collateral. It does not matter if your business project is a complete disaster; if you have collateral they will lend you their money. Qirad is completely different because only if you are honest and your business is good you will have investors, but the stipulation of any collateral is null in this kind of contract. With the banks their money is directed to the people who have enough level of wealth. With qirad, investment follows the natural tendency of the honesty and the good business of the community. Banking imposes, through its monopoly of paper-money, their own conditions of self-protection.
The qirad is a protection for agents as well as for investors. It is a protection for the agent because in a qirad contract the agent will share according to the results of the business. In the usurious contract the agent is tied to a fixed interest before he knows the results of the business. Thus the bank is not investing money but renting money, although money cannot be rented (like a house or a car). In qirad, if the business of the agent has difficulties the investors will want to help him rather than expropriate him as the banks do. The qirad also is a protection for the investor because he knows what he is investing in and it is guaranteed that the totality of the results of the business will be shared. In the usurious system the investor has two choices: either 'rents' his money at the fixed interest offered by the banks and other financial institutions or he has to 'invest' his money at a 'variable interest' offered by the corrupt system of shares (Stock Exchange). The shares guarantee that you cannot decide on 'your' business -unless you are a majority owner-, therefore you do not know what you are investing in, neither do you know who is effectively going to be running the business. Through this form of 'investment' the majority owners can reinvest your own profit without your consultation, in whatever way they like. What is left for you is called dividends, but this is really like interest. We should recall this to the criminals of the 'islamic bank'. The contract of partnership guarantees the ownership of all the co-owners rather than only those who hold the majority of the shares. 'Majority ownership' of the shares is irrelevant in the contract of partnership. All the investors are equally protected.
Banking can only happen where there is lack of trust. Qirad can only happen in a community where trust is exalted, because the contract of qirad itself calls for this trust. In effect the qirad gathers people while the banks divide people. By the progressive implementation of Islamic Law we gain the trust that we have lost, which is what we need to overcome the banking trap. Every time we behave within the sunna of the Prophet, peace be upon him, Allah makes it easier for us, in the inward and in the outward. Thus we realise that we are free in Allah. To implement qirad and partnership, it is in our hands by Allah. Whoever denies this or says that this is not possible, is worshipping other-than-Allah, he is trapped in his own illusion. He is a slave and he is paralysed for fear of his own illusion. This fear and submission to usurious behaviour go together.
We are calling for a free man who is free to behave within our Law. We will create a differently shaped society. The society where the qirad was normal was a different society without banks or necessity of banks. It was a society with agents, not banks but agents. The agents brought the people together, without themselves forming an institution. They brought this man with this other man to make a business. The agent is like the old woman in the village who says this young man can marry this young woman and so arranges marriages. Without her some marriages would never have happened. The agents are there in the middle of the society, forming an organic part of it, bringing people they know together and not necessarily for money. The wealth of the agent is his honesty and good reputation. He competes in honesty with the others. The best of them is the one who is more honest, therefore more people will trust him with their wealth. Then he does not need to go to the people but people come to him.
We want to produce agents and put them back in the society. Their very first political role is to bring trust again to the people in such a way that is made clear that we do not need the banks. How can we produce these agents? We have to educate them in the Law of Trade, which is very simple, although these people of 'islamic economics' want to make it complicated. We strongly denounce this thing called "islamic economics" as a form of confusing people, and we denounce their product the so-called "islamic bank" as an attempt to lure some Muslims into the banking system, while destroying their communities. The agent thus takes on a political role rather than an economical role. He does not regard himself as a business or economical unit, but rather like a doctor who is curing the sickness of a society. His job is not to make a business. His business is to give a remedy to the usurious sickness by using our halal forms of business and not their usurious forms. Living and thinking like an economical man is a sickness in itself, usury is its evident effect.
Knowledge of Allah is what prevents the agent from being a robot like the 'economic man'. This is a time where there are people, some of them Muslims, who regard themselves as being unemployed. 'Unemployment or employment' is economic conditioning. The Muslim does not regard himself within these categories. We are above that because we have knowledge. The sufis use this metaphor to explain knowledge; "Man is like an ant who is so close to the carpet that he cannot see the design. Knowlege is elevation from the carpet, and the carpet is dunya. The person who is 'unemployed/employed' is spiritually so close to the carpet that either he finds himself totally useless or in need of the salary in some business of the usurious system. All business today are usurious on their bases because they all are forced to deal with usurious paper-money, which is banking-money. He knows that the bank for instance is no good, but he thinks he has no better choice. He works for the state, although he knows the state is criminal. Even the businessman profiting within the usurious frame is a slave. All these people have failed to understand the nature of dunya and they are slaves of it. The way out lies in Islam. We need the most pure Islam.
The opposite of the slave-economic man is the man who, trusting Allah, has become free from his own illusion. By giving up dunya he has gained all of dunya. The sufi says: "If you run after dunya, dunya runs in front of you. But if you turn your face and run to Allah, dunya will run after you". This is the law of existence, but the laws of economics are not the laws of existence, they are only madness. If you understand this then you can understand your role within existence. Existence has no reality in itself, it is only a means for you to recognise Allah.
Then, how can you change your perspective? The sufi says:
by generosity and by breaking your habits (changing, travelling). The man who knows is not limited by what is his or what he knows. He embraces all property and all knowledge. If he wants to make a business, he asks the means from the people who has them, just as he takes the knowledge from the people who knows. They are waiting for him. And if he is of the best, the people will go to him. The Messenger of Allah, peace be upon him, said that if you really knew, you would be like the birds who go with their stomachs empty in the morning and come back with them full in the evening. This knowledge makes people free to get out and destroy the usurious system.
The agent who is servant to the community has all the community available to him. He can implement qirad and partnership while cleaning the market of usurious practice. He finds the means from the people who have it and knowledge from the people who know. These people are waiting to use what they have. The agent who wants to make a business relating to shoes, for instance, will naturally will find finance more likely from the people who can assess better if the effort and the investment is worthy or not. They may be able to suggest even better ways to go about it. Thus the people of the same profession get bound together spontaneously when there are no banks. This is how the original guilds come to existence. The spontaneous creation of guilds and other types of association is part of the new landscape of the market that does not need usury.
Abandoning usury is the command of Allah to the believers. And it is in our hands to abandon it progressively. First, we need to gather the community together. We can do that by educating agents who will in turn glue the community together by the means of generous social behaviour and increasing our personal relations within Islamic business contracts. This first stage towards the Islamic Market we call the Qirad Market. As soon as we, the community, have grown in loyalty and trust among each other and enough wealth is circulating among ourselves, then we can move to the second stage.
The second stage is what we call the White Market where people have decided to use a different medium of exchange-other than paper-money-. It is like a Black Market except with clean money. Probably we will mint and put in circulation gold and silver coins for the exchange. We sell the paper-money and buy gold and we put the gold in our market. It is in our hands to substitute more and more paper-money for gold and silver. We can use gold and silver or anything else. This flexibility will impede the kafir from manipulating our market by forcing the prices of gold or silver up and down, because we can change from one medium of exchange to any other according to our own convenience as long as we avoid paper-money. We can also stop paying any tax to the criminal state, because at that point with our mutual trust we can hide our transaction by the simply way of not reporting it to the state. The White Market is defined as the market where we are able to have our own money (real money) and where we can avoid state taxation.
Within this situation we can gain enough strength for our amir to declare and carry out the punishment according to the Islamic Law to the people who continue cheating, while before we can only exclude them from our market. At this point we can declare an Islamic Market where no form of usury will be allowed.
If we do not abandon all usurious practice, Allah has warned us of war from Him and His Messenger, peace be upon him. This reminds us of the second part of our job. We have to construct an Islamic Market and actively we have to destroy the usurious system. The usurious system has became a system of power-control ruled by the jews over the nation states. It is enormously complex but it is enormously fragile. It is sustained in the illusion of its power. The moment people realise that the monster is really nothing, it will be destroyed. Our job here is to break the idols: burn the paper-money or print it in enormous amounts, introduce computer virus in the banking nexus, sabotage their information records, boost the figures, erase the debts, etc. Money is today electronic impulses, what can be more fragile than that? These will inevitably become the practice of the future.
It is, by Allah, in the hands of the Muslims. The Jihad of our time is to abolish usury. This is what we, the Murabitun, are doing. This is the easy way and the path of success. Success belongs to Allah.
I was just sent today's postings, saw your piece and am very happy you found this item. It's good that this is public now. It is my intent to engage the direction of your post along with using much of the groundwork laid by MK's and Randy's solid efforts. Truly, these men have seen through the fog for some long time. This year that fog should clear for all to see. If only I had more time and energy. But, it shall be done.
A trail walk is coming, oh yes, it's coming! (smile)
http://www.murabitun.org/documents/economics/beyond.htmlIf Islamic Nations recognize EURO over US dollar you can bet they expect much greater Physical Gold backing to be given to the EURO.....Gold/EUROs' for OIL? If their so called Jihad against Usury were to escalate full swing it would be just GOLD for OIL....IMHO....YGM
Happy New-Currency Year! Fed adds $10.5 billion to banking system
In two open market operations today, the Federal Reserve provided a temporary injection of over ten billion dollars to the nation's banking system.
Beginning with 27-day repurchase agreements, the Fed added an even three billion dollars, only to be followed shortly thereafter by a $7.505 billion addition via 3-day repos.
At the time, the fed funds market was fetching 6-11/16 percent, higher than the Fed's target by 3/16ths.
I found the article below in the New York Times. How much longer do you think Americans will continue to believe this tripe about inflation not making a comeback?
January 2, 2001
What Keeps a Bottom Line Healthy? Weight Loss
By GREG WINTER
Perhaps shoppers did not notice as they scurried through supermarkets filling carts with potato chips and nachos for the holiday party, but their loads may have been a little lighter than in the past.
In an effort to offset rising production costs, Frito-Lay, the world's largest maker of salty snack foods, has begun putting fewer chips in bags of Fritos, Chee-tos and other well-known brands, while keeping the price the same.
A supermarket-size sack of Lay's potato chips has lost an ounce in the last month, or about 7.5 percent of its previous weight, but still costs $2.99. A 99-cent box of Cracker Jack has shed about 6.7 percent of its weight. And a $3.29 bag of Doritos has dropped almost 7 percent of its weight.
The packages themselves have also shrunk, ever so slightly, so they do not seem less full when customers grab them off the rack.
"It's a rip-off," said Jan Buttram, a playwright out shopping for a Christmas party at a Midtown Manhattan supermarket. "If I knew they were putting less in, I wouldn't buy it."
Industry insiders have a name for the practice: the weight-out. It is a subtle way of earning more from everyday products without scaring off price-conscious shoppers, and it is quite legal as long as the package accurately describes what is inside.
Makers of candy, coffee and tuna fish have all tried weight-outs, with varying success. But the practice had been relatively scarce since the mid-1990's, largely because the cost of raw materials was low enough that manufacturers could afford to forgo price increases and still preserve the bottom line.
Now, however, the cost of production is rising � expenses like energy, packaging, even ink. So weight-outs have slowly begun to resurface as a means of maintaining corporate profits without enraging customers, who are often none the wiser.
"We haven't encountered an environment like this in a long time," said Emanuel Goldman, a food and beverage analyst with ING Barings. "There's more resistance to raising prices than in the past, so you're going to get a lot more of these weight-outs."
For instance, while holding prices steady, the Perrier Group, a subsidiary of Nestl�, has just completed a switch to five gallons from six for home deliveries of Poland Spring bottled water, a swap it plans for water-cooler jugs of its Calistoga brand as well.
In September, Procter & Gamble scaled back the number of disposable diapers in its Luvs and Pampers packages by an average of 13 percent, while cutting prices only 7 percent. Company officials said the change, which, for example, comes out to eight fewer diapers in a jumbo pack that previously had 56, left parents with just enough diapers to get through the week, while providing Procter a price increase for each diaper sold.
Kimberly-Clark made a similar change to its Huggies diapers almost immediately after Procter & Gamble acted, prompting makers of many generic diapers to do the same.
"Everyone in the diaper industry is downsizing to the same count," said Tami Jones, a Procter spokeswoman.
With consumers increasingly resistant to paying more at the supermarket, conditioned by years of low inflation to expect stable prices on everyday items, some experts predict that other consumer product companies will soon follow suit.
HEADLINE: Six Gulf Nations Hold Summit . . . Saturday, 30Dec00
MANAMA, Bahrain (AP) - Leaders of six Persian Gulf nations debated plans for a single currency Saturday during an annual summit that also was expected to focus on possible tariff and defense pacts.
+
The heads of the Gulf Cooperation Council states - Saudi Arabia, Kuwait, Bahrain, Qatar, Oman and the United Arab Emirates - are trying to unify their currencies by 2003, two years earlier than originally planned.
All is not lost. Your outlook is based, it seems to me, on a prolongation of present trends. But those trends are going to change.
The best example of the future is Russia. The strictness of the USSR was followed by..corruption on a massive scale.
This is what awaits the world as a consequence of the debt orgy of the 90s.
The U.S. is a very highly controlled society (where the rulers want control) because the strong dollar permits the rulers to pay their enforcers.
That will come to an end when everyday inflation hits, with unemployment and the debt tsunami which will swamp the people. Everything from a parking ticket up will be "negotiable" with a "direct tax payment" to the enforcer. Especially if you have a gold or silver coin to offer.
That what you visualize is desired by the rulers, yes. But they will not be able to enforce such a dehumanization.
Corruption will be the oil that permits life to go on under dehumanizing legislation.
"...using much of the groundwork laid by MK's and Randy's solid efforts."
I echo your thoughts on the yeoman's work Michael has done on many fronts--largely unsung--on behalf of educating gold owners everywhere. And 'thank you' for the nod toward my own humble efforts at contribution toward fostering appropriate public gold and monetary awareness; but I assure you, compared to the foundation laid by the likes of you and ANOTHER, I am but a babe in the woods. Thank you again for the past efforts involved in sharing your unique insights and wisdom, and for selecting USAGOLD as your "media outlet".
Just before Christmas I posted an item which, for the sharp eyed, would have given them the strongest clue as to where the world's real problems lie.
It was a young Jewish man (so no anti-semitism here, anti-Zionism, perhaps) who was so incensed at the way His Father's house was being used for usury and things allied, and where money was being worshipped instead of His Father, that he entered the temple and drove out those that would defile the holy place.
Before this, the establishment had been prepared to tolerate His preachings to the masses. But TWO WEEKS after the physical action of actually interfering with their
money worshiping, lending, and wheeling and dealing, He was put to death.
Did His death end it? Not a bit. It is still the basic cause
of the world's problems. If you don't see it - you have a severe eye problem. As He said, "there are none so blind as those with eyes yet cannot see".
Sierra, I also hope dearly for trends to change, but as Panda has reminded us...Little has changed since Christ the Man walked among us...The Money Mongers can change the Rules, the Country to exploit and the methods used but their "Greed" still reins supreme....The battle for truth and light will go on and on....And the Greed is like a Macabre Energizer Bunny with unlimited Fiat Air Power.....
Go Gold, Go GATA, Go Physical and bury it deep!....YGM
Thanks for helping me see thru the oily fog yesterday.
I know of a prominent pet food manufacturer that made a transition from a $10 lb bag to 8# at the same price. Sounds like 20% to me. Also, went shopping for some winter coats for next season and something dawned on me; the prices we pay for many, many garments are relatively stable; marked up and marked down as the retail game goes round and round. However, especially in the realm of outerwear, materials employed at these price points are marginal IMHO. The better made coats, hats, mittens etc are hard to find outside of a specialty shop where the prices are typically much higher.
Harmony (HGMCY) inherited a hedge book when they purchased Randfontein. They have since unwound that position. The recent purchases from AngloGold (AU) look to have come off without a hitch. You are apparently referring to some speculation by a couple of minor gold enthusiasts named David McKay & Tim Wood who occasionally write articles about mining companies for the web site MiningWeb.com. They are frequently off the mark. Harmony's main selling point is that they are unhedged. If they were to change that philosophy, then they would lose the loyalty of virtually every one of their shareholders. The shareholders would rather they not purchase any additional properties if there were a requirement to hedge. Otherwise, why not purchase shares of the hedge-fund AngloGold with its low PE and nearly 9.3% dividend yield? Besides, they are doing quite well with good cash flow, excellent favorable rand-USD exchange rate, a pile of cash on hand, and low operating costs. If they were to hedge, then I and many others would drop the shares immediately.
I saw that interview. He was quite right about most of that. Matt Simmons of Simmons & Company International has said much the same except that there is the possibility of many dying from the extreme temperatures. Right now, the only thing that can stop that scenario is warmer temperatures. Forecasts of warmer temperatures resulted in a drop of over a dollar on NG prices today. If we make OK this winter, then all I can say is that we dodged a bullet and are only delaying the inevitable. In the CNBC interview, Mr. Castellini said that increased drilling would occur now. OOPS! Sorry Charlie, but where are the NG producers going to get the necessary drilling rigs? Nabors Industries (NBR) is scavenging the junkyards for bits and pieces of old drill rigs so they can slap together something resembling a drill rig. The drill rig manufacturers went outta business years ago when the price of petroleum cratered. They went tits up. And how about experienced drill crews? They aren't many left. They moved on to more stable careers. The companies don't pay squat for drill crews. They have been reduced to recruiting crews from the ranks of recently released felons. If not this year, then for certain next year looks like quite an adventure. Another reason for the shortfall � the companies that require NG as a raw material can't stop production indefinitely. Also, what happens if summer heat has people firing up the AC? The power plants will be burning NG all summer long, and more NG power plants will be coming on line.
Tumultous day,quite a start to the new "trading"year.
I was quite interested/concerned about Bill HR4541,the commodity futures modernization act of 2000.It seems to have dropped off the radar screen of late.
If anyone is aware of any new developments,I would appreciate the update.
...
Did you buy stocks you never heard of?
Q COM at 150 or above?
'Cos your plumber told you so
Now do you believe in Home Depot?
Can Wal-Mart save your portfolio?
And can you teach me what's a P/E ratio? ..."
Good work, Sean Brady and Tom Kearney! Parody may not be the highest form of art, but my DNA molecules think copying is just a fine idea!
New York--Jan. 2--NYMEX Feb Henry Hub natural gas futures ended down $1.411, or 14.43%, at $8.364 per MMBtu amid forecasts for warmer weather in the Midwest beginning this week and continuing into the middle of January. Market observers attributed the weakness to warming forecasts from both the National Weather Service and private forecasters. "It's just strictly a weather play," said Salomon Smith Barney analyst Kyle Cooper. Temperatures will be cooler than usual in the southeastern states while a large part of the northern and central Plains and Midwest turns warmer than usual, according to the latest 6- to 10-day weather forecast period from the National Weather Service. Welcome relief to one of the coldest Decembers on record will come to the Midwest Jan. 9-15, according to the NWS 8- to 14-day outlook. Temperatures will be warmer than usual from Minnesota, far eastern South Dakota, extreme eastern Nebraska and far northeastern Kansas through Michigan, Indiana, Kentucky and northern Tennessee to New England, New York state, New Jersey, Delaware and the majority of Virginia. Cooler than usual temperatures will occur from west Texas, the Oklahoma Panhandle and extreme southern Colorado through Arizona and far southern Nevada to central and southern California. The remainder of the nation will experience near normal temperatures.
OUTLOOK:
Players will continue to monitor the weather reports for any change to the forecasts for moderating temperatures. "It's going to be very sensitive to the weather forecasts for the next week," one broker said. "With all the demand that we've lost, with any decrease in electric generation demand, you're going to have some gas looking for a home." Brokers indicated that the market should see a rebound from Tuesday's sharp sell-off, particularly with the overall fundamental outlook still supportive. "I can't believe this market's going to continue to move down," another broker said. "I see no fundamental shift in this market whatsoever." The broker added that he expected the market to consolidate in the $8 to $10 range, noting that despite a brief break above the $10 mark last week, it still represented strong resistance. Meanwhile, the American Gas Association is expected to report that U.S. natural gas storage levels decreased by about 185 to 205 billion cubic feet although estimates as low as 130 bcf and as high as 230 bcf have circulated in the market, according to a BridgeNews survey of brokers and analysts. The AGA report will be released after 1400 ET Wednesday. Market sources indicated a number toward the lower end of the range should be fairly neutral while a number in the 200s could support another strong rally. "I think the AGAs won't hurt, but I think the market will go up anyway," the broker said. "I don't think we need the report, but I think it will confirm what we already know."
http://abcnews.go.com/sections/business/DailyNews/wnt010102_naturalgas.html For NG prices, follow the link above. First read the NG story. Then click where it says in detail at the bottom of the page, a map of the US will pop up, then click on your state to find out how much more you're likely to spend on NG this winter. I think it's a bit low on the prices in some areas, but then hope springs eternal.
View
Yesterday's Discussion.
http://www.mrci.com/qpnight.htmEuro is climbing again � up +$0.15 at $95.33, and USD index down -0.16 at 108.48. Would be nice to see some follow through on gold, but we may have to wait until the current Potomac Gangsters vacate the White House. Also, if the bright lights are pointed in the direction of those cockroaches, maybe we will see what has happened behind the scenes as the new Gangsters crack open the ledgers. Gonna get fun after January 20th!
http://dailynews.yahoo.com/h/nm/20001229/bs/lawsuit_outerbanks_dc_1.html NEW YORK (Reuters) - The U.S. government has been ordered to reimburse Exxon Mobil Corp. (NYSE:XOM) and Marathon Oil (NYSE:MRO) $78 million each for 19-year-old drilling rights they were denied because of an environmental protection law, lawyers said Friday. The U.S. Court of Appeals in Washington, D.C. on Thursday also ruled that the Department of Interior (DOI) is liable for interest payments, said Allan Ripp, attorney with Sidley and Austin who represented the companies. In 1981, Mobil Corp., and Marathon each paid the Department of Interior (DOI) $78.2 million for drilling rights off North Carolina's barrier islands, the Outer Banks. But in 1990, Congress passed the Outer Banks Protection Act which forbade drilling where the companies had paid for the rights. The DOI will pay Mobil which merged with Exxon in November 1999, and Marathon in January next year, Ripp said.
Black Blade: God forbid we become less dependent on foreign oil!
NEW YORK (CBS.MW) -- Shares of gold companies closed higher Tuesday, following three days of declines, lifted by a weakness in the stock market. Over the last nine months, "the gold index has tended to do very well on severe down days on Nasdaq," said Chad Williams, an analyst at TD Securities, who's based in Toronto.
Fundamentally, investors are discounting a flow of funds out of the U.S., he said, which will eventually result in a lower U.S. dollar, implying a later rise in gold prices. "Investors are betting on higher gold prices in the next few months or so," he said. In the equities market, the CBOE Gold Index (GOX) rose by 2.1 percent to 30.66 and the Philadelphia Gold and Silver Index (XAU) climbed by 0.7 percent to 51.78. Individually, shares of Newmont Mining (NEM) added 88 cents to close at $17.94 and shares of Agnico-Eagle Mines (AEM) gained 38 cents to $6.38.
In other related news, Freeport McMoran Copper and Gold (FCX) said fourth-quarter operating results at its principal mining unit, PT Freeport Indonesia (PT-FT), will top previous estimates because of improved ore grades. Q4 output is expected to top 500 million pounds of copper and 875,000 ounces of gold. Shares of Freeport rose to an intraday high at $9, but closed at $8.31, down 25 cents. The company also announced that PT-FT resumed normal mining operations at its Grasberg pit mine. The unit had been operating at limited production over the last eight months as the government conducted a study related to environmental issues.
Gold futures prices fall
Gold futures prices fell, weighed down by weak demand for the precious metal over the holiday season. On the Commodities Exchange division of the New York Mercantile Exchange, February gold fell $3.60 to close at $270 an ounce after dropping to its lowest level in five weeks. March silver shed 4 cents to $4.595 an ounce. Physical demand and sales over the holiday season, especially out of India, were "relatively disappointing for precious metals prices," said Ross Norman, director at TheBullionDesk.com in London. Over on the supply end, Comex gold warehouse stocks were down 83,055 ounces to 1,701,224 ounces as of late Friday, and silver stocks rose 7,631 ounces to 93,983,167 ounces. Meanwhile, March palladium climbed $14.05 to $968.50 an ounce, while April platinum rose 80 cents to $608.90 an ounce. In other metals news, March copper slipped 3.15 cents to 81.15 an ounce. Tuesday morning's NAPM report revealed a slowdown in manufacturing, an indication that the need for copper in the industry may begin to fall Early Tuesday, London Metals Exchange warehouse stocks were flat at 357,225 metric tons.
Black Blade: Gold share movements tend to precede gold price movements. The apparent price manipulation gains steam as the physical price should have moved much higher in tandem with a weaker US Dollar and significantly higher demand. Meanwhile, Palladium continues to climb higher as it becomes ever more evident that the metal simply will not materialize out of Russia this year.
DJ Asia Precious Metals: Spot Gold Regains Some Losses
And a bit of "Monkey Business" in the gold market. SINGAPORE (Dow Jones)--Spot gold edged a little higher Wednesday in Asia from its late New York level Tuesday, but it failed to recapture overnight losses. The metal saw heavy selling from funds Tuesday in New York, causing the metal to break technical support levels at $272.00 a troy ounce and $270.00/oz, a trader in Singapore said. Asian dealings were thin Wednesday in the absence of Japanese participants. Light short covering was believed to have lent support to the metal Wednesday in Asia. At 0643 GMT, spot gold was trading around $269.75 a troy ounce, up from its late New York level Tuesday of $268.90/oz. It remains, however, down 1.3% from its late Asian level Tuesday at $273.20/oz.
"Funds were big sellers last night," a trader with a European bank in Singapore said of the market late in New York. Market sentiment was cautiously bullish Tuesday in Asia with some participants expecting gold to benefit from a stronger euro and the Australian dollar. However, sentiment turned bearish following the sell-off in gold by fund managers. "Fund selling will continue," he added. "Price movement in the first three months of the year is usually indicative of price direction" of gold, the trader added. "With selling coming quite forcefully like yesterday...it will continue. The general trend (in gold) is weakish," he said. Spot gold, he said, could slide further to $265/oz later Wednesday. Dealings in the rest of the precious metals was negligible Wednesday.
-By Hamisah Samad, Dow Jones Newswires; 65-421-4834; hamisah.samad@dowjones.com
Black Blade: It's always the same old story � some unnamed trader/analysts says that some unnamed "fund" is selling. Then they continue to talk down gold, yet the fundamentals are somewhat Bullish for gold. Very curious indeed.
Your faith, and patience, WILL be rewarded if, from now, you quietly add some GOOD QUALITY gold mining shares to your portfolio ON THEIR DIPS (and there WILL be MANY of those).
Ignore the negatives that will be put out ((and there WILL be MANY of those) - that's all part of the game.
Have a GREAT year!
Incidentally:- The GOOD QUALITY stocks are not hard to find - they have flashing neon signs all around them.
Palladium is up another $7.00 after being up $17.00 yesterday. Currently the metal is at $970.00/oz and counld easily surpass $1000.00/oz. from here. The Russians are out of metal. It's going to be fun if anyone at any of the exchanges try to collect some physical metal. This could be a good preview of the gold market once the metal is "allowed" to float free of manipulators hands.
http://quote.yahoo.com/q?s=^DJI&d=myI would like to present some ideas for discussion. This started for me with the realization that maybe a good case could be made that literal hyper inflation has been on the scene for some years. I am not an economist, nor do I play one on TV; thus I'm ready to be corrected and instructed.
Consider this case for hyper inflation:
Look at a linear graph of the DOW30 over time:
Goto http://quote.yahoo.com/q?s=^DJI&d=my and download the spreadsheet version. Note that the chart displayed is a log scale, and the line seems without understanding this to be a somewhat straight line. BUT-- Import the numbers into a spreadsheet and graph the data in a linear scale.
If you didn't know what you were looking at, you could swear it was a graph of the value of the old German mark during the Weimar Republic.
This got me thinking�
MK and CPM have had various contests to name a previously overlooked factor which, to put it mildly, may cause future problems.
There is no contest now, but here would be my entry: Debt is not fungible. "Everyone" treats it like it is.
The US dollar is currently a unit of debt. I do not yet have a graph to display, but I will make the assertion that if you make a graph of the sum of personal, corporate, and governmental debt over time, you would end up with an exponential growth chart far worse than even the DOW30 chart.
In this respect, it is unclear as to what the M1, M2, and M3 money supply numbers represent. If the dollar == debt, they are an expression of some liquid debt available for immediate use. Debt that is parked in traditional fiat "stores of value", such as money market accounts, bank deposits, etc. So. They say nothing of the magnitude of outstanding debt. They say nothing of the actual positions of the market players. They are only a strange sort of net sum of debt interpreted according to an earlier age when the dollar was not debt.
In measuring outstanding debt, I believe you need to be consistent. To measure the absolute value of outstanding debt, you need to add the value of all debt. Not add the sum of debt owned and subtract ( double negative? ) the debt owed. To do that would only be meaningful for individual participants, and only then if debt were fungible.
I have only discussed traditional debt denominated directly in dollars. Until recently, many tech companies liked to boast how their stock was a great currency for buying other companies. This is literally true. Or was true. Here is another source of "money" that isn't detected by traditional government measures, yet was being used as money. Perhaps stock isn't debt, and yet:
It has been observed that junk bonds bridge the gap between traditional stocks and bonds. Often they trade at a discount that reflects the current perceived prospects of how likely the company will be able to service the bond. That is, their market value varies based on the company's performance, just like a stock.
I'm not going to develop this thought further but I believe a good case could be made that with the fact that most stocks no longer pay dividends, but rather retain earnings, and with employee stock options and other derivatives, stock is more a debt ( future promises ) based store of value than is often acknowledged.
The bottom line in an individual example is this: Suppose I have a second mortgage from Bill for $10000, and Jill has a note from me, also for $10000. My net position is zero. Yet it is clear that I can't depend on Bill ALWAYS sending me the money when I need it to pay Jill. In normal, polite times, yes. As long as rates of change for various factors aren't too great, as long as Bill has a job, as long as the macro picture doesn't bump up against some limit.
In the bigger picture, each market participant may have a manageable position of debt owned vs. owed. Yet each market participant can at the same time have large debt positions which he is assuming are offset.
So picture this huge interconnected matrix of debt. Yet with all the types of debt issued by different players, with all the varying liquidity, with all the variation in likelyhood of actual payoff factors, in no way can debt be considered fungible. Thus each debt should be subject to continual revaluation.
Except things wouldn't work that way. That is why banks don't recognise losses, or mark their assets to market value. They must pretend debt is fungible in order to keep the game going.
Because "money" is officially measured as only some debt parked in certain accounts, and because people look at the net sum of debt owned less debt owed; and not the absolute value of debt outstanding, the magnitude of debt has been growing without causing alarm. Remember, the dollar is a unit of debt, thus indeed a good case can be made that the dollar has been in hyperinflation for some time.
The picture as presented here is very similar to the physical vs. paper gold controversy. During normal polite times, they may certainly appear similar. The net sum of paper shorts and longs may be a reasonable, manageable number. But the general assertion at this site it to not count on this remaining true during the times you really, really want the attributes of gold.
Clinton Lovers: Read No FurtherA Multi-Cultural Farewell Salute To
A Multi-Cultural Farewell Salute To
The Child King
Dear Bill,
Thank you William Jefferson Clinton for a most entertaining eight years of Presidential Capers. The 22nd amendment to the Constitution, our country's current favorite, is still in effect and so you must now vacate what we used to call the White House. It will need to be properly cleaned and whitewashed for your predecessor's progeny's prestigious and pristine possession. There is little doubt that you have left your mark (stain) (scent) on this esteemed estate and you will, unfortunately, not soon be forgotten. The State of the UNIONS has never been so public or sleazy. We have been contacted by multiple international citizens that eagerly join us in this celebration of the termination of your tenure. The Nations ARE United and we extend to you these heartfelt and earnest, global messages:
French - Finalment il est parti! On en est enfin de`barasse`s!
Portuguese- Ainda bem one vais embora!
Thailand - Kob - Kun!
Philippine - Sa lamat umalis na!
Romanian - Bine ca au plecat!
Italian - Finalmente se ne va!
German - Gehe zum teufel!
Polish - Dziekuje oni poszli!
Spanish - AM__!
Ebonics - Get to steppin!
Dutch - Ga naar de vaantjes!
English - Good����.��Mr. President. Good Grief!
Goodbye! Good Riddance!
There has been much speculation as to what you will do, at such a young age, to wile away the hours/days while you patiently await a post-Presidency Noble Piece (spelled right) Prize, of which your subtle lobbying efforts are sure to pay off. Could we offer a few second career suggestions for your consideration? You do have vast talents, contacts, and experiences upon which to draw, and it would be nice if they finally could be tapped
Suggestions:
1. The Robert Rubin School of Arkansas Economics needs a Dean of
Student AFFAIRS. Experience required, yours should suffice. You could in fact, be a bit over qualified, but RR can fix most anything.
2. How about starring in a komic strip called Klintoon? Actually a
Kontinuation of the last 8 years' debacle. Reruns only will be required,
PLEASE.
3. You might consider becoming a fundraiser for the American Conservation
Union. You and your Boss (Ms.) are the best thing that ever happened to
them. How is that little matter of their audit progressing?
4. Please spend some time apologizing to your not-ready-for-prime-time
apprentice, Algor, for blowing his chances to also become "One of our
greatest Presidents". You screwed up the quid pro quo. That was some
real teamwork boys, the folks back home in Arkansas And Tennessee are
real proud of you two. DelusionAl just needs a few more cycles of The
Lanny Davis School of Endless Repetitive Spin and maybe he won't give
up so easy next time. Did he sleep through too many of his Saturday Night
Live assignments? Poor Al had to pretend he hardly knew you, Bill, after
all your selfless years of service.
5. Lobbyist for the New World Order - unless that is getting a bit stale and
tiresome. You and Pinocchio have more in common than just the nose
complications. Those strings seem like they could be a bit annoying?
6. Selling franchises of the Ken Starr Emission Inspection Stations. Cost-Up
to $55 Million per inspection. You cannot run a VRWC {Vast Right Wing
Conspiracy} on a shoestring budget.
7. You could do tobacco ads on TV and expound on the benefits of not
inhaling or taking personal responsibility for your actions.
8. How about pooling your resources with O.J. to jointly get to the bottom of
Nicole and Vince Foster's untimely deaths?
9. You could just totally retire as the Founding Father of Illegitimate
Presidencies and Children. Put out to pasture so to speak (You must stop
drooling, Sire).
10. There has to be a immense demand for Hair Salons on airport runways
called- I'm Stylin' You're Waitin'! Number 42, you are clearly a pioneer
as well as an entrepreneur. The free markets await your participation and
vision.
11. Your plans for a friendly (chummy actually) takeover of Tyson Chicken
should fully succeed. You will be able to sort out all the right wings and
personally handle EVERY breast, leg, and thigh.
12. Clinton Crisis Counseling Clinic for abused women - mostly just ice
patrol!
13. Challenge Charlton Heston for NRA Presidency based on your starring
role in "The Ten Commanding Scandals". We have almost forgotten
who your Best Supporting Actress was.
14. You could mediate some more serious global problems like you did in
the Middle East recently with such great success. Move over Jimmy!
Next time if you will quit giggling every time you say the name Yassar
you might have more success.
15. Hollywood is much too obvious to even mention. Barbara Streisand is no
Marilyn Monroe, but on the other hand, she's no Monica or HRC either.
You could do a remake of "Trading Places" starring both you and
Hillary. Stand-ins could be used for the love scene, no problem there.
How about a series called "I BEG YOUR PARDON" which would
showcase { the hopefully coming} Bush Presidential etiquette?
16. Kofi is Kalling. Go feel his pain and take Ted Turner with you!
17. The PGA tour might accept you, but I doubt they will be willing to let
you keep your own score. You have assuredly hit on more ladies in the
gallery than even Gerald Ford did.
18. Much time can be spent simply waiting for the coming official
Republican apology for YOUR IMPEACHMENT. Check your e-mail
regularly. What were those guys thinking with this "rule of law"
nonsense?
19. Every Law School Library needs a Lexicon for multiple
meanings/interpretations/applications for two letter English words.
20. Your own weekly television show on FOX (in the chick house) TV,
government reforms oriented. Geraldo can lend a helping hand.
21. You will have time to write an autobiography. I should not
require much work and we can actually save you a lot of trouble
as one rather large word will suffice:
Coverupsubpoenabimbosnortscamliesmenacigarbluedressraisetaxesfbi-
Indulgentcheatdnaderivativesroselawfirms&lsaxpaulasexbentapistray-
wagdogembarrassdonnaeconomystupidiceovalmanagersjuanitashilloral-
danlassiterfilegatecopresidencyisdeceitbribestarrasprinfactorylucianne-
#^*!&%healthcaregrabjimguybubbletrialmcdougalsimpeachedlegacy-
spinpuppetdesksusanhoovernosedepositionragincajundenialwebster-
naftatrippstallnoshameparsebuddyteflonpredatorchinagateforcetroopers-
septumhousesenateoathespyronbrownmonicahedonicsgoldbuster-
internlipsmovingdraftsociopathsomaliadollyfelonyperjurerenemies-
rogerdodgerhush$stonewallsecretservicecocaineaddictivepersonality-
glibpollslincolnbedroomdysfunctionalOhellUgettheidea!
Please let me know if you need any more help on this project.
22. Find a new country in which to practice law. Sri Lanka comes to mind.
Alan Derschowitz could also stand an extended sabbatical. Why can't his
Doctors get his medication right? Is he the best you can do?
23. You will have beaucoup opportunities to try out your precious Executive
Orders in your various trailer park soirees. Hoping you do not experience
any more FEMA failures.
24. You could spend the rest of your life paying back favors for Lady Reno
TSE {Trouble Shooter Extraordinaire}. Will she remain on the payroll
indefinitely?
25. Ever thought of starting a Dream Team of X-Presidents? Andrew
Johnson, RMN, and WJC, not necessarily in that order. Looks like a
clear LEGACY from this angle, but you are welcome to write your own
history books and who could stop you anyway?
26. Permanent Dependent Counsel for your estranged wife, Scandal - in �
Waiting, Senatorium Hillary Rodham? Is she prolific or what? You
could play the scorned man next go- around, it worked so well for her.
Any truth to the rumor that Hill-Rod makes more than A-Rod ]
{unofficially of course}?
Global citizens are nervously holding their breath in anticipation of your next adventure; we will soon get to quit holding our nose. The world is beckoning you now, Mr. X-President; some call you Slick Willie, some Comeback Kid (Puleeeze NO), some Boy President, some Bubba, I now call you GONE! We're happy for you, Bill, but mostly we're happy for us. Sounds like the fat lady (with the beret) is vibrating her vocal chords. And no, Sir, you do not get to take the ESF {Exchange Stabilization Fund} with you!
A final word - Get some help somewhere.
Respectfully,
Auspec (FOB) (Farewell Old Boy) - Hope we haven't hurt your ego too much - - - Better get some ice on that.
Permission is hereby extended to copy, fold, bend, staple, mutilate, or forward this article. No additions please-I do NOT want to run the risk of offending our political leaders!
The Grasshoppers Learn About Procrastination and the Costs of NIMBY
Gas suppliers refusing sales, PG&E unit says
The cash and credit squeeze created by the electricity crisis in California has prompted 15-20 natural gas suppliers to decline to sell gas to the company beyond current commitments, said Pacific Gas & Electric Co., a unit of PG&E Corp. The California utility also said it could have kept gas prices down if the California Public Utilities Commission (PUC) had permitted the company to build more in-state storage and lock in capacity rights on various pipelines that deliver gas to California. The company said Friday it had purchased enough gas for its customers' projected use in January, as long as temperatures do not drop, increasing demand above forecast levels. The utility delivers natural gas to 3.8 million customers, including residential consumers. January gas bills will be 60% higher than December, the company reported. Market prices in January are expected to reach record levels, following dramatic increases in November and December due to cold weather and record demand by natural gas-fueled power plants. The average residential bill will rise to $125 in January, compared with a December average of $77. In January 2000, before prices began to spike, the average residential bill was $50.
Gordon R. Smith, CEO of the utility, said it will not be able to finance the high cost of natural gas spreading it out over several months because of the company's present financial position, resulting from the "outrageous" wholesale electric prices the company is paying on behalf of its customers. "What should be noted is that many of the companies who have declined to sell us natural gas are the same companies who own power plants in California and are currently charging as much as 30 times what it costs them to generate the power," Smith said in a prepared statement.
If Pacific Gas & Electric Co. had not taken mitigating measures such as storing gas in the summer, average January residential bills could have been as high as $162, the company said. In the past, the PUC discouraged investment in gas pipeline assets. If the utility had been able to take other mitigating steps, customers' bills would have required a small surcharge, but compared to today's astronomical market prices, the surcharge would have seemed minuscule, it said. Pacific Gas and Electric also reported it has asked the Federal Energy Regulatory Commission (FERC) to impose price caps on gas delivered to the California border and points within the state. And the company has requested FERC to suspend contracts between El Paso Natural Gas Co. and its wholly owned affiliate that Pacific Gas & Electric Co. alleges have allowed those companies to manipulate prices in the California gas market.
Moody's Investors Service weighed in on the controversy surrounding the creditworthiness of PG&E Corp. and Edison International. These utility holding companies accumulated more than $8 billion in debt from unrecovered purchased power expenses in California. The investor-owned utility holding companies were also under a threat last week that Standard & Poor's would downgrade their ratings to "junk" bond status pending action by the California Public Utility Commission.
Black Blade: "And the Grasshoppers danced, sang, and played all summer�" These leeches just don't help themselves at all. They knew this day would come, yet they procrastinated and figured on stealing from others. Let em� freeze in the dark! Sounds cruel? How else will they ever learn?
The US Department of Justice filed suit against Duke Energy Corp. on behalf of the Environmental Protection Agency, charging that eight of the electric utility's power plants illegally released massive amounts of air pollution. The DOJ alleges that Duke Energy violated the Clean Air Act by making major modifications to all of its coal-fired power plants in the Carolinas without installing the equipment required to control smog, acid rain, and soot.
Black Blade: Yeah, shut down those big bad polluters! Besides, who needs all that electricity anyway?
http://www.newaus.com.au/us174gold.htmlSo, who would want to inherit the ESF when it is now more widely known that said organization or fund (or whatever) is involved in the manipulation or alleged manipulation of commodities (to wit: gold, silver?) and possibly S&P futures?
If I were the incoming administration with a lawsuit hanging over my Treasury department, I would want to clean laundry quickly and put the blame squarely where it belongs.
I would think the job of gold afficiandos would be to keep the pressure on this particular suit and alleged dealings of the ESF. Only in that manner could one assure oneself that they had done everything that can be done, to set the gold market straight.
The media, including CNBC who SHOULD know better, continually explains the power debacle in California was the fault of "deregulation, and in fact the teaser from which I excerpted the clip below, repeated at least four times, included that PG&E was in trouble because of "deregulation:"
- In an interview with Ron Insanna, the Chairman of P G & E, the California
electric power utility that's under extreme pressure because of power
shortages, revealed the cause: ~"We have to pay $.40 per kilowatt-hour but
because of regulations, we can only charge $.05 for it when we sell it to our
customers." If the situation isn't remedied, P G & E will be bankrupt within
six weeks. -CNBC, Jan. 2, 2001, ~6:47PM EST
The price of oil is dropping after the sudden surge upwards.
In spite of the recent bloodshed in the Middle East, and the apparent intransigence of Israel, they are still 'hopeful� of 'Creepy Clinton' pulling it (a so called peace deal)off.
Saddam has had a sudden 'heart attack'
Oh hum. Isolated incidents? Not on your Nellie.
Remember what I have always pushed home - He who has the (most) Gold makes the rules. Who has the most gold? The USA? think again, and again, and again.
Who do you think has been soaking up all this gold that has been dumped over the past decades? Don't be fooled by which country appears to be buying or selling. When you are international - every country is your home - but you owe allegiance to none.
The oil price was raised partly to put pressure on getting 'the best deal' they could at the table. The recent flair up of bloodshed in the M-East was likewise.
All parties know there is some settlement in the cards, but it is NOT Clinton who has been doing the talking. Only MONEY talks. If you believe otherwise - quit now, you've no chance in this dog eat dog world.
If any deal is done, you can bet your bottom dollar that a lot of financial assurance has been given, a few palms have been greased, a few Swiss bank accounts stocked up (we are not talking about the odd million or two). And, with whose money? - YOURS, and mine, and all the other poor wretches of this world. Money that could have built hospitals, educational establishments, better roads, and kept down crime, or raised the standards of those third world countries that have been bled to death. But the real price has yet to be paid by the common man - the bill is about to arrive.
If it isn't done, watch the price of oil move up again. Watch for a few other horrors as well, like a few leaders being toppled in the M-East.
The pressure is on now; something is about to snap. You can feel it at every turn. We have to thank, in no small way, those raggy a*sed stone throwing Palestinian 'Davids' who have, with little moral support - and none from the media, stood up to Goliath armed with technology and armour that could outclass by far, especially considering size - a land of six million people, and with no natural resources (not a drop of oil), any other power in the world.
So, if a deal IS done, give not one drop of credit to Clinton, though the media, for its own ends will push the world to believe that.
http://www.mrci.com/qpnight.htmUS Dollar is crashing against most currencies, markets overnight flounder, futures are lower for all indices, and yet - PMs sink lower. Curious isn't it? Very difficult to believe that there is no "Malign Forces" holding down PMs.
Weak dollar, stocks seen lifting gold--but not yet
By Sara Marani
LONDON, Jan 3 (Reuters) - Falling U.S. equity markets and weakness in the U.S. dollar have so far failed to inject life into the gold market but analysts said on Wednesday that a positive knock-on effect could come soon. ``Gold's weakness has been a bit surprising -- we expected the upside to be capped but not the downside to be tested,'' said Merlin Marr-Johnson, analyst at HSBC. On Tuesday, the NASDAQ index saw losses of seven percent after manufacturing data reinforced fears of rapidly slowing growth in the United States and triggered a dollar sell-off. ``The dollar is weakening, the scope for an interest rate cut is here, and all this cannot be positive for the U.S. stock market,'' said Frederic Panizzutti at MKS Finance in Geneva. ``Investors will be repatriating flows and since most of the money invested in the U.S. is from Europe, it will come back to Europe and contribute to pushing the euro higher.'' The euro hit five-month highs against the dollar on Tuesday, rising as far as $0.9544, while the Australian dollar broke through the U.S.$0.56 level to set four-month highs. Once producer and consumer currencies strengthen, gold is more affordable for non-U.S. buyers and it is less attractive for producers to sell. ``The strong euro and Aussie have had a positive impact on physical demand, but the problem is that the physical buying interest was matched with non-physical selling which was not really currency related -- probably some long liquidation -- and that's why we didn't have the normal schoolbook reaction,'' explained Panizzutti.
RECOVERY DOWN THE ROAD
While traders and analysts agreed gold would never manage to recapture fully the safe haven status it once enjoyed, they expected to see some evidence of a flight to quality soon. ``While more liquidation and more downward pressure is possible short-term, we still have positive consumer confidence here (in Europe) so at some stage we expect this to have a positive impact on the gold price,'' said Panizzutti. The spot bullion price was expected to dip to around $260 a troy ounce before ticking back up towards $275-$280 at the end of the first quarter. ``We still have a positive year view and conditions for gold look better this year than last. Conceptually we're looking at about $280 for the quarter,'' said HSBC's Marr-Johnson. At 0940 GMT gold was quoted at $268.70/$269.20 a troy ounce, just up from Tuesday's New York close at $268.65/$269.15. Another factor which could contribute to an upturn after a possible price dip was Indian demand. India is the world's largest gold consumer and traders said many buyers were waiting for the price to fall to $265. ``Most of the Indians are looking to buy at $265 and once that happens things should pick up,'' said one trader. The 1999 agreement between 15 European central banks to limit gold sales and gold lending could also support the price, but only once demand shifts up a gear. ``The accord is a very positive step if we are in a demand market but we are still in a supply market and the tightening effect they (the banks) tried to create hasn't happened,'' said one analyst. ``If we move into the higher demand market, anticipated at the time of the accord, then the price will pick up.''
Black Blade: That does it! I'm going to go kill some Ducks! Later.
Free psychoanalysis @Black Blade, Journeyman, MANY
Hi Black Blade, Journeyman, MANY!
I've been meaning to write this for awhile, but I can procrastinate with the best.
There are many of us here who see "the system" as evil and secretly rooting for retribution, though we well know that we will likely be one of the vicitms of any retribution -- and many of our innocent countrymen & women, guilty of nothing more than a little facilitated (or possibly induced) ignorance and a bit of laziness.
And likely as not, those who SHOULD suffer retribution will escape largely unscathed. Saddam, while his people's children starved, almost certainly never missed a single banquet or meal.
But there's a deeper problem with hoping for justice and retribution where they are due, and that is, like other forms of revenge, it tends to cloud one's judgement. One tends to excerpt the bad things that are happening to the perceived miscreants and project them indefinitely into the future --- and to ignore little details --- like, for instance, most Iraqis hate Saddam even worse than some of us dislike Clinton.
If we're bett'n folks -- and as you may know, from my viewpoint we ALL are whether we know it or not -- this can skew our bets from cool, rational probabilistic prognostications toward betting against the SOBs.
While emotionally satisfying, it can easily lead to economic suicide.
My dear Sir Black Blade, and others, who keep filling your minds with this clap-trap put out by Reuters et al, and the two bit analysts that abound. Even if they new the truth, they would not tell you.
I know you mean well,I also know you don't really believe them, but so many of you are like drowning men ready to grasp at any straw, even though you know it won't support you.
Many of you know the reasons in your heart of hearts, just as I do, why gold is not moving, or going to move ( and we are not talking of a few dollars here and there). Yet you keep rehashing this bullsh*t which you don't believe. This is masochism pure and simple.
Face up to reality. When gold does make a move, it will appear to be for no apparent reason (though some will be suddenly found) - no crisis. It will be slow and gradual - and, in its small way, volatile. But then it will be good for trading.
Meanwhile, wait for those dips, study the quality gold mining stocks carefully, get to know them like the back of your hand, study their trading ranges. Buy on the severe dips and accumulate.
With the best mines (costs)trimmed to the bone and expanding, free from deadwood, gold won't have to move much to make them VERY profitable. Good mines also have a habit of taking care of their shareholders, so besides capital appreciation there will be good dividends.
So come on fellows - stop letting your enthusiasm, and excitement rise and fall with each little movement, or analysts forecast, or GATA statement. The people who are running the show, and controlling that psychological metal, and real money of the first and last resort are far more powerful than you could even begin to get your minds to imagine.
Ian Fleming was (probably on more than one occasion) asked if he didn't think he had made his stories of 007 and the secret services a little bit far fetched, and that people found them a bit hard to believe. His reply was that if he (ex-secret service) told everything that went on - the real truth, they would have been absolutely, unbelievable.
The same can be said about what, and who, is moving this world.
From yesterday's article on the summit of the Gulf Cooperation Council regarding the unification efforts for the currencies of the six states Saudi Arabia, Kuwait, Bahrain, Qatar, Oman and the United Arab Emirates, it was reported "The group has an $18 billion trade deficit with its largest trading partner, the European Union."
While recognizing that this group represents just a subset of the Petroleum Exporting Countries, it can be said that OPEC sells to the world but does a bulk of its own shopping in Europe. America is on pace for an annual trade deficit with OPEC reaching $48 billion, and America also does considerable shopping in the euro area, too, also running a trade deficit on pace for $48 billion for the current year.
It is not lost on officials of other countries that the U.S. has enjoyed the privilege of simply creating the international manna from the new issue of U.S. Treasuries while others must labor to earn these same currency units. With the U.S. running perennial trade deficits, on the whole it should seem apparent that the primary utility of our excess dollars shipped abroad is found in its use for reserves and for the international repayment obligations on past debts.
On point, when looking at current human productivity and the balance of modern trade rather than the debt-legacy of our fathers, the deck is stacked toward euro strength and dollar weakness as we move forward. If various nations such as those seen here are earning dollars but spending euros, you can see where a falling dollar exchange rate on the forex market might be ill-tolerated by those in a position to "name their price". In the end, it is goods and services rendered that pay for goods and services consumed. Meanwhile, the currency units are just digital blips that simply keep time to the music of commerce among the international orchestra, and can change suddenly "for" or "against" your position depending on external factors and on your own reliance upon these blips. Do not mistake these blips as equivalents to real wealth.
Gold is the single internationally-respected hard asset that moves freely in financial circles to provide a liquid reserve (savings) alternative -- protecting its holders from bad management of, or fading confidence in, their own local currency. Call Centennial to find out how easy it can be to...get real. Get gold.
In the event that it seemed strange that I referred to U.S. trade deficits for both OPEC and euro-land that were "on pace" for annual shortfalls of $48 billion each for a year that is ALREADY over, please understand that trade figures have only been released thus far through the month of October.
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FOA...I enjoyed your latest contribution to the Gold Trail. Thank you again for all that you do, for the time and effort expended in selfless assistance to the greater understanding of your fellow man. Long health and happiness to you and all those near and dear.
YOUR QUOTE:
"And likely as not, those who SHOULD suffer retribution will escape largely unscathed. Saddam, while his people's children starved, almost certainly never missed a single banquet or meal."
From where do you get your reasoning that Saddam does not care about his children, his people? That is the picture put out by our media, time and time again (US and British).
Yet people who have got close to him, and who have no ulterior motives or axe to grind, do not see him this way.
Why did he really invade Kuwait? Why did Galtieri (Argentina) invade the Falklands? Why do some of the other Arab Sheiks not like Saddam? Why are the people of Iraq prepared to suffer again and again this humiliation we meet out to them? Why are so many Palestinians prepared to die without direction from their government? Why do they love and respect Saddam? Find the real answers not the ones put out by media and �backed� historian writers.
Just because Britain, and some other countries sold their soul for some pieces of silver, there are others who are prepared to die to preserve their culture, and their heritage, and their beliefs. They do not want to be the 51st 52nd 53rd state of the US, official or unofficial, or any other international entity that operates via the US.
Did the US president, at the time, care about those poor wretches he sent into the hell-hole of Vietnam. Most of them were almost children and many from deprived areas. The man America made president skulked in Britain while they fought and died. Then he abused his office by screwing around with a young intern, beside all the other shenanigans
both he and his wife got up to.
Yet, just because the people behind the scenes printed money like there was no tomorrow (besides other financial manipulations) creating an artificial prosperity, he gets lauded as though he is a saint. Now he will be proclaimed the great peacemaker, no doubt.
From what little I know to make judgement, Saddam is no better, nor no worse than most, but from his feelings for his people - and the whole Arab people, he is probably better than many.
To make judgements on what the media tells us is probably the greatest disservice we can do yourselves. If you believe
the media is 'free', then what else can I say. Your mind is closed.
When our media tells us so and so is 'bad' - ask yourself one simple question, especially when they keep pressing the point - Why do they really want me to believe that?
Remember, at the close of world war 2, your most revered and decorated general - Patton, when he was able to get close to his enemy, and also 'see' who was really about to benefit from the war said " I think we fought the wrong people" Now here was a man who had given his all, and was closer to the truth than anyone. Oh! by the way, a few weeks later he was dead - from an 'accident� of all things - how surprising
"...the physical vs. paper gold controversy. During normal polite times, they may certainly appear similar. The net sum of paper shorts and longs may be a reasonable, manageable number. But the general assertion at this site it to not count on this remaining true during the times you really, really want the attributes of gold."
Yes, indeed! As I have tried to stress before, if a person is looking for a diversification or safe haven outside of their national currency, a position in paper gold (derivatives) amounts to little by way of accomplishing the objective as it is only a variation of the paper debt-based theme. Only physical gold is free from the risk of default or bad national monetary policy.
TrailGuide-maybe your magnificent teachings has finally allowed us to walk the golden trail for ourself,I mean there are now too many footsteps visible to miss the way,like in a catalytic chemical reaction:without the catalyst,no reaction at all.Adding the magic,often precious metals containing catalyst,the reaction kicks off easily,and in the end you'll rediscover the catalyst unchanged.
The only thing different with you is that you might have grown a few grey hairs extra because of us (smile)
BlackBlade-thanks!I hope you are right as I thought to read Swanepoel's own words of worry on "how to explain it to our investors".As if Chase warned him not to close the hedges.But you are right,there is no reason to own a hedged HGMCY,except the stolabars sales program.
Gold is now within a few dollars of its 52-week low. Ten-year U.S. government bonds are within a few basis points of new 52-week highs. The Dow Jones Utilities Index was at a new all time high on Friday. Clearly, all of this is happening because the popular big money bet these days is as follows :
"There is no inflation danger, but, to be sure things stay that way, Greenspan has over-tightened credit and thrown the economy into a recessionary spell which, if anything, will mean slight deflation and lower interest rates in the months ahead."
If you believe this scenario, then you must not be a buyer of gold. Like the rest of the crowd, you have been dumping technology stocks and buying government bonds, utilities, etc. Like the rest of the crowd, your portfolio is perfectly up to date...perfectly up to date, that is, and headed for a fall.
Yes, there has been a lot of discounting on Main Street recently. And such things as Christmas mark-downs and fire-sale PC prices are bound to impact inflation indices for a while, at least.
But money has not been tight. Money has been loose, VERY loose. This is why, despite six Fed rate hikes and constant reassurances by the "experts" that inflation is not a problem, price indices last year recorded their biggest jump in a decade.
From Wall Street to Washington, almost no one will believe it. Take yesterday for example. When the National Association of Purchasing Manager's report of economic activity was released, it was accompanied by the biggest prices-paid component increase in five months. Yet the media uniformally dismissed the number as being immaterial; so great is the public's faith in Alan Greenspan and his delusive rate increases.
I have argued in these pages for the past two years that higher interest rates would not, could not, deter this economy from its rendezvous with inflation if money itself was allowed to grow out of sight. When I started, the U.S. dollar was experiencing a mild bout of deflation. At that time, no one in this room would agree that things were about to change. But, since then, quarter by quarter, inflation in America has climbed steadily back up to where it is today.
Now, even skeptics admit there is no quick fix in store for higher energy prices. For two years, they argued that energy didn't count like it used to. It simply wasn't as pervasive as before. Yet, now we are all being inundated with stories about companies cutting operations due to higher energy expense and products at the supermarket being downsized, again because of higher energy prices. The list will get bigger, believe me. Recent monetary data prove conclusively that this Fed does not have the courage to slam on the brakes.
Believe what you wish. But, if you are to protect your savings in the year ahead, you must understand this simple word of advice. Money is loose in America again. Inflation is on the rise, and it is destined to get a lot worse before it gets any better.
Just Provided the Lift Off For Large Sucker Rally...Half point rate cut....Whoopee paper lift off. Now the debt load can become even more "Irrational"....Fools rush in and
"wise money gets an escape route".......YGM.
Kinda like a "BANANNA" Republic move....in Brazil to calm market jitters. Similarly lets some institutionals off the hook,"Temporarily"....Greenspans Airbus is flying on fumes.......YGM.
-China opens new physical Gold market,next June(!) or so,this is now confirmed-Paper POG does not anticipate higher demand as it used to do (hey,there are only a billion humans!?)
-Stockmarket is in a serious bear market,no POG reaction exept down
-euro up,already close to parity,no POG reaction exept down
-and the most important thing,the Dollar has been hit hard lately and no POG reaction exept down
Investors,especially Goldbugs are totally clueless.If they would be used to FOA glasses,they could see it clear like Swiss rock crystals
We knew the Comex-POG didn't reflect real Gold demand for some time.But now,the Comex-POG has decoupled from the currency markets!!!It goes down with the Dollar!Comex paper Gold is not anymore an alternative to the $!The heat is on now on the physical market.The year of change...
Is what we need......"Name That Fund"...LTCM, Tiger, Princeton.....Which Fund will go next. It undoubtably will be BIG and WILL bring Wall St to it's knees.....This in my opinion is the greatest fear of the Fed. The dollar is still at great strength, but somewhere there's more than a few Derivatives Traders out there sitting on (or add the 'h') "Razor Blades"
There's many out there w/o Delta safety.......YGM.
used to be... certain times of the year you'd find the guys all standing around a radio in the break room, ears turned to the speaker, brows knitted, listening... listening to the intense moment of some championship game or match, for the next play, the next pitch...
right now, i've just finished observing several people (not just the guys anymore), all huddled around someone's computer, eagerly clicking 'reload' every few seconds to see how high we are now...
i have heard several audible 'hurrahs' and applause coming from several areas of the office floor. i actually observed two guys give each other high-fives.
sometimes i long for a more simple time when such behavior was reserved for a no-hitter, or a bases-clearing homerun in extra innings.
at least mr. blade can go 'kill some ducks.' i... i will just resort to going to get another cup of coffee...
Is it the PPT?Maybe they are getting back on-side, but you can bet your boots alot of others will also sell into the rally....I'll be surprised if this Excuberence lasts 48 hrs....YGM.
Only because he's a so-called "leader" @Pandagold (01/03/01; 10:05:45MT - usagold.com msg#: 44936)
Hi Panda!
Actually, there are two un-worthy reasons I "picked on" Saddam.
1. He's a so-called leader, nearly all of which these days don't pay their way. They don't risk their lives in defense of their group. Not even for their own dominating ruling oligarchy, let alone the taxpayers who's bones they pick. I could as easily have used Slobodan Milosevic or Bill Clinton -- or Tony Blair.
2. People tend to dislike Saddam because of said Brit-American propaganda -- and thus using Saddam tends to reinforce my point rather than detract from it.
AS I said, unworthy reasons, chosen to shortcut to a quick point.
Whoa, there Panda. I'm mostly on your side in this. You will not find me excusing modern "leaders" their sins, no matter who their victims are.
And I'm aware of the Rothschild scam after Waterloo. Etc. It's just that "they" don't have nearly that control or power anymore. Things are too complex. There are too many players now days and too many wild cards can bollix up their plans.
Further, it was "their" ancestors who, for relatively short-term gain threw not only us, but their progeny into the paper furnace we're burning in. They had no coherent long-term plans that have held-up very well that I can see.
Globalization, yes -- if done "right." But of course it isn't and won't be. Too many competing "mafias." Who won't give up power. Look how long it took to get the euro. And true "union" is still at least decades away.
Fed begins supplementing Treasury and Fannie+Freddie
Obvious panic at Greenspan's map room.
Amazing instantaneous response to the instantaneous 7.5% drop in cost of short term Fed Funds. Response is an initial 11% on the Nasdaq, 16% on the Nasdaq 100. 3.5% jump in the Dow. Obviously we have a short squeeze not unlike the October 1998 mother of all short aqueezes.
Could it be that cost of funds to the bidders at the stock market is the Fed Funds? Meaning that bank trading desks are doing the buying?
Nasdaq 100 jumped vs. the five year note rate by 20%. The Nasdaq composite went up 15%, and the Dow is up 6% vs the note's interest rate. (The five year note is the first measure of returns alternate to stocks. Thus an investor putting funds into stocks is giving up the available return on a 5 year treasury - implying he foresees a rise in the stock greater than the interest paid by the treasury.)
To put things in perspective, the ND 100 has fallen 66% intraday relative to the 5 yr note yield from its high on the year in March. The SP 500 was down 39% by the same measure from its relative high at the same time. This provides a picture of the drop in investor expectations of future returns after the discounting rate is taken out of consideration.
Not to be outdone by the stock market, the bond market reacted with its own idea of happy times - higher rates.
I was just working out my estimates for projected bottoms in the Treasury papers. I had 5.37% for 30 yr, 4.86 for the 10 yr, 4.53 for the 5 yr with alternates 4.67 and 4.40. Since the Fed panicked, I can't be sure those rates would all be reached. The 30 year definitely did get there and then some, the tenner hit it on the dot as well, and the fiver hit 4.71, though not all the way to my favored 4.53% projected bottom value.
Looks like mortgage rates held back on continuing their trend. It may now be time to refinance if you have a high mortgage rate.
"WASHINGTON -- Faced with a cooling economy, the Federal Reserve unexpectedly cut interest rates Wednesday.
The central bank's move, slashing its key federal-funds target by one-half a percentage point, came four weeks before Fed policy makers were set to meet." - Wall Street Journal
Alan Greenspan must be really scared to go to this extreme. This is not an indication that Greenspan can engineer a soft landing, this is a glaring indication that the US economy is facing serious problems, most likely related to the debt explosion of the past ten years. If the economy slows down it is going to become increasingly more difficult to service outstanding debt.
Yesterday, the first trading day of 2001, both the Dow and NASDAQ declined ominously. Today's rally is one of the best examples of a sucker rally I've seen in years.
It appears as if 2001 is going to be a very interesting year, if nothing else. I hope we will all be able to prosper in spite of the financial turmoil that is likely to unfold.
Keep your eye on the gold price. A slowing US economy should lead to a declining dollar and that in turn should cause the gold price to rise.
If I had an interest lever, I'd lever it in the morning (or afternoon), I'd lever it in the evening, all over this land...
Ah, the free market...we had one once. I'm so glad AG sees "inflation contained", otherwise, there'd be real cause for concern. I guess AG means inflation is contained to only the Fed, the banks, the GSEs, and Wall Street pumping the money supply. A colander would qualify as a more convincing "container". The only thing worse than not having a central bank is having a central bank.
Put in simplistic terms, it is not the amount of unfungible (Good post, Turl) debt outstanding, but the monthly (Fungible?) cost of servicing it that controls the fate of the debt bubble.
Hopefully I'll have time tonight to post on why this will NOT be inflationary. Right no I'm out the door to manipulate some doug-fir and cedar.
http://www.deepblacklies.co.uk/main_page.htmI was thumbing through a magazine in a local health food store and was taken aback to see an article on Euro/Dollar/Gold/GATA. I didn't buy the magazine but did check out the website and was directed to the link posted above. I'm not sure if you can access the full article on-line or not. My apologies if this is old news.
The magazine was Nexus Magazine (nexusmagazine.com).
Press Release from the Federal Reserve on today's rate-cut decision
January 3, 2001
The Federal Open Market Committee decided today to lower its target for the federal funds rate by 50 basis points to 6 percent.
In a related action, the Board of Governors approved a 25-basis-point decrease in the discount rate to 5-3/4 percent, the level requested by seven Reserve Banks. The Board also indicated that it stands ready to approve a further reduction of 25 basis points in the discount rate to 5-1/2 percent on the requests of Federal Reserve Banks.
These actions were taken in light of further weakening of sales and production, and in the context of lower consumer confidence, tight conditions in some segments of financial markets, and high energy prices sapping household and business purchasing power. Moreover, inflation pressures remain contained. Nonetheless, to date there is little evidence to suggest that longer-term advances in technology and associated gains in productivity are abating.
The Committee continues to believe that, against the background of its long-run goals of price stability and sustainable economic growth and of the information currently available, the risks are weighted mainly toward conditions that may generate economic weakness in the foreseeable future.
In taking the discount rate action, the Federal Reserve Board approved requests submitted by the Boards of Directors of the Federal Reserve Banks of New York, Cleveland, Atlanta, St. Louis, Kansas City, Dallas and San Francisco.
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Bottom-line: The banking system will at all costs be kept afloat in a sea of liquidity at the peril of bringing the demise of the "strong dollar". The material distinction between currency units that merely grease the wheels and the actual wheels themselves (real wealth) will become ever so much clearer for all to see and appreciate.
FOA,
today you posted on the Gold Trail at 10:50 Eastern Time "Michael and Randy, today is a very good day! A very good day, indeed! (smile)"
It nearly leads me to fancy that you saw in advance that this surprise rate cut was in the works. Any other rabbits up your sleeve?
"This explains why the record of Greenspan's recognition of market trends has been consistently six months late. Yet the Fed cannot afford to wait for market discipline to correct a credit crunch. And because of the recognition time lag, coupled with the diminished ability of the Fed to
affect market decisions, and the compressed chain reaction time of collapse, each subsequent intervention would need to be escalated or overshot to achieve comparable effect, which in turn increases moral hazard to fuel the next abuse. It is intervention inflation, similar to the narcotic syndrome of pushing towards the edge to reach new highs which always leads to fatal overdosing."
I wonder if this rate cut by the FED was due to them seeing information that is about to come out later this week. It must be really bad news to pull this stunt without the talking heads on CNBC analyzing Greenspans suitcase and whether it looked big enough to offer a rate cut.
Historically, commercial banks have turned to the Fed Funds market for needed currency, shunning the Fed's direct discount window as though it were a self-admission of trouble and weakness. And yet, from the Fed's action and statement, we see that the Fed "stands ready to approve a further reduction of 25 basis points in the discount rate to 5-1/2 percent on the requests of Federal Reserve Banks."
As we watch stocks climb today (much short covering?) and devine the future, we must ponder why a person with an account of ready, spendable currency would use it to buy stock. After all, stock ownership can be seen as a bet on the company and its management to enjoy future prosperity. Is such prosperity likely in an environment in which the Fed finds this sudden need to help liquidate the banking system?
It is such official tinkering ostensibly "for the common welfare" that kills a fiat currency faster than what would be its natural course toward the inevitable death. So as I sit here typing this with a gold sovereign lightly clenched between my teeth (for the proper effect for the historian photographer), it strikes me as fundamentally clear that the Fed's rate cut may make dollars easier to come by, but does nothing to loosen the Earth's grip (nor the grip of other gold owners) on its preciously rare gold. As such, gold remains the supreme reserve asset honored and respected the world over...past, present, future. Call Centennial to get some for yourself at a very appealing price; with dollars that are made easier to come by, it will not always be this way. Upon what is your wealth built? Get real. Get gold.
The guy's got a lot correct, but over-all he's hopelessly confused because he confuses "free-markets" with fascism of the merchantilist sort.
And he seems to think that problems caused by collusion between businesses and governments can be corrected by, well, MORE collusion between businesses and governments.
Just goes to show you what havoc can be wrought by simple confusions of terms.
If you follow some of the commentary at USAGOLD, you will recognize good corroborating evidence in this Brige report
[Bridge News] London--Jan. 3--COMEX Feb gold futures managed to trim some of their
losses, ending down only 70 cents at $269.30 per ounce after initially
extending Tuesday's fall and slipping to a one-month low of $267.60. Like
Tuesday's session, Wednesday's trading proved to be another puzzle, as
gold price moves appeared to defy the usual market logic.
.........As well as weakness in gold,
the Commodity Futures Trading Commission commitment of traders report
provides some clues on why the price is slipping lower, said David Meger,
metals analyst at Alaron Trading. He said that it shows small speculators
are heavily long and trading against commercials and funds, which are
short. "You tell me who you think's going to win that battle," he said.
--------------
If you are a hedge fund that has previously borrowed gold from a bullion bank in order to raise a source of low interest funds for investment purposes, please marvel how very easy it is to offer the short side of futures contracts as necessary to create the stagnation in this realm of price discovery as needed to buy the time (and metal!) to unwind the prior gold loans.
Simply put, some financial "chapters" are written for the benefit of the overall book. Use their weight and effect to your own advantage and buy gold for yourself at these bargain prices. This condition will not last forever...for reasons previously stated.
Nasdaq and futures. - dollar and Euro - competing with the EU
By my rough calculation, the nasdaq buying is lagely futures and index (QQQ) related which have come through with some 60% of the funds.
The intensity of the Fed decision (1/2 point instead of 1/4)may have to do with the coming January expiration of a couple of weeks hence. The nominal drop on the ND 100 (the hedge vehicle sold by the banks to institutional investors) was over 55% from the top, and the quarterly drop was 40%, and nearly 50% from the summer rally peak. The year over year loss came in at about 40% as well. The maximum tolerance for drops of this kind on Nasdaq is some 30% by my estimate, therefore a major drop such as we have seen is too great for the banking system to tolerate. Thus once futures purchases did not work anymore at the current interest rate. Despite broker's (not investor's) margin debt rising beyond the levels seen at the market peak, the Nasdaq continued to deteriorate rapidly. The pace of decline and its persistence in the face of major price support efforts meant that put option trades were conducted at a loss that threatened some or all of the bank's financial viability.
Because the trades were too heavy on losses, and levels had accumulated so very sharply so far, it became necessary to lower the cost of the futures and the arbitrage into them to overcome the historically high friction (difference between realized and expected prices in executing an arbitrage trade) and the absolute magnitude of losses.
The heavy block trade selling yesterday and on the last trading day last year could have something to do with the inability of the banks to sell puts at a price that instituitonals could pay given their expectations for possible investment gains going forward. Not being able to hedge, they started dumping stock in order to reduce exposure. The rate cut would allow a drop in the effective cost to the bankers of conducting price support operations by 7-8%, and lower the cost of hedging to institutions by a similar proportion. Any additional reduction in premiums as a result of reduced volatility expectations would assist in lowering the price of protective put options.
Related to this is the heavy selling of stock by insiders now that cashing out of vested stock by selling rather than through guaranteed payout contracts. A large volume of insider stock was hedged and borrowed against over the years by insiders using a variety of brokerage and bank services. Through this system, insiders could lock in their income from stock grants and options while avoiding capital gains taxes. The cost was reportedly about 15%, including interest expense, providing a savings of 30% relative to after tax gains. The put option's portion of the cost of the contract was around 5-6%. At current volatility levels and interest rates, a comparable cost for the same strategy would have been 25% or so, since premiums on puts had risen 3 fold in the tech (and other high growth stocks).
Financial corporations selling thes hedge and loan packages have met heavy strains as their hedge strategies were met with illiquid markets and price gaps on opening of trade that made the hedge strategy nearly impossible to implement profitably.
The "Dead Body" that the bond market is looking for to explain the rather sharp Fed action in their announcement of Dec. and the current surprise action was still missing from public view. Needless to say, there must have been one and the corpse must have given off quite a heavy stench at the Fed's undertaking facilities.
The dollar reaction is a resumption in capital flow into stocks. The Fed and the Bushes might be thinking of working towards a continued capital drain on Europe, something not consdered by the Clintonites who tended to cooperate, and at times lead EU (particularly French) attempts at capturing international income by taxation. The attempt has been made by the Clinton IRS to capture all the income information and sources for income generated in the US financial system. They, and his Justice department have been extremely aggressive in their pursuit of financial information. The Clintonites were cooperating with the OECD efforts (led by French and some German interest) out to prevent governments from competing internationally on tax rates, regulation, and government services, namely protection of property rights.
As detailed in a post of a week ago, there are alternative options available to the Bushes that the Clintonites, being the socialists that they are, could not follow because their interests were too heavily intertwined with the preservation of a large and expanding government power. It should be pointed out that Clinton stood slightly to the left of the middle of the Democratic delegation to Congress, thus putting him to the left of at least 75% of Representatives and Senators. I am sure that many Democrats in Congress were apalled at the extent and depth of the Clintonite power grab, and were even distressed at the arrogant disregard of them that Clinton displayed in his practice of substituting executive orders for legislation - much of which did not have support of a majority of his own party's congressional delegation.
I am ever so slightly hopeful that the Bushes take apart the Clintonite barrage of executive orders and move policy away from cooperation with the EU socialists to competition - which the EU would lose because of the rigid economic and power structures.
Even with an oil backed Euro - meaning that the EU can print up its oil supply just as the US had done since 1971 - getting oil at a cost to third party countries - the EU would still face the fact that tar sands are profitable at $30-35 on a large scale, and coal based liquid fuel breaks even below $45 (numbers are a bit old, but costs were rumored to be falling), fuel cells from nuclear energy sources are also profitable at about $100 oil, and most of the cost is infrastructure - thus once it is installed, running use is very low in cost. Remember Yamani's warning to the Saudis that the "stone age did not end for lack of stones".
Europe will only be able to garner a limited and temporary advantage from the arrangement with Arab OPEC. Considering structural limitations to European management talent reaching its optimum positions in corporations, it stands to reason that the advantage would be squandered.
Note that the debtor is always the one coming ahead in a default. The debtor suffers recession - the creditor undergos a depression as existing export facilities are converted to local use, and some of the historical investment is lost. In the debtor's economy, the housing and warehouses remain and are as useful as ever, investment remains intact, just that the economy shifts from moving around imports to producing replacements for them.
Where expanded credit (as from a FED easing) goes -- as if we didn't know! @ALL
The objective of credit expansion is to favor the
interests of some groups of the population at the expense of
others. This is, of course, the best that interventionism
can attain when it does not hurt the interests of all
groups. But while making the whole community poorer, it may
still enrich some strata. Which groups belong to the latter
class depends on the special data of each case.
+
The idea which generated what is called qualitative
credit control is to channel the additional credit in such a
way as to concentrate the alleged blessings of credit
expansion upon certain groups and to withhold them from
other groups. The credits should not go to the stock
exchange, it is argued, and should not make stock prices
soar. They should rather benefit the "legitimate productive
activity" of the processing industries, of mining, of
"legitimate commerce," and, first of all, of farming. Other
advocates of qualitative credit control want to prevent the
additional credits from being used for investment in fixed
capital and thus immobilized. They are to be used, instead,
for the production of liquid goods. According to these plans
the authorities give the banks concrete directions
concerning the types of loans they should grant or are
forbidden to grant.
+
However, all such schemes are vain. Discrimination in
lending is no substitute for checks placed on credit
expansion, the only means that could really prevent a rise
in stock exchange quotations and an expansion of investment
in fixed capital. The mode in which the additional amount of
credit finds its way into the loan market is only of
secondary importance. What matters is that there is an
inflow of newly created credit. If the banks grant more
credits to the farmers, the farmers are in a position to
repay loans received from other sources and to pay cash for
their purchases. If they grant more credits to business as
circulating capital, they free funds which were previously
tied up for this use. In any case they create an abundance
of disposable money for which its owners try to find the
most profitable investment. Very promptly these funds find
outlets in the stock exchange or in fixed investment. *The
notion that it is possible to pursue a credit expansion
without making stock prices rise and fixed investment expand
is absurd*.[6] -Ludwig von Mises, Human Action A Treatise on
Economics, Third Revised Edition (Chicago, Illinois:
Contemporary Books, Inc. 1966), pg. 795 & 796 [XXXI.
CURRENCY AND CREDIT MANIPULATION, 5. Credit Expansion
available also on-line from
http://www.mises.org/humanaction.asp]
+
[6] Cf. Machlup, The Stock Market, Credit and Capital
Formation, pp. 256-261
Randy (@ The Tower) 13:32:16MT - usagold.com msg#: 44957)
-- surprise rate cut was in the works. Any other rabbits up your sleeve?------
Hi Randy,
Your post made me comment!
Ha! Ha! Allan blinked first and a small few knew it! Picture him and the ECB standing head to head, not moving an inch. He moved and now the dollar is lost. With all the quick short covering on the stock and currency markets, "noone" noticed how much the long bond got smashed.
------ A 30-year bond fell a whopping 2 10/32 to 111 2/32 to yield 5.48 percent -----
Now our strong dollar support system is fracturing away. This year the dollar will lose it's reserve status to the Euro. Or at the very least share it. Nothing is going to fall again as a "Real" inflationary bias begins to build in our dollar world. Stocks, real estate and even basic economic activity will all feel the effects of a super dollar expansion. Done only to keep the dollar status somewhat in the game. Deflation will not be allowed. Nor will the gold derivatives markets be sustainable in dollar terms. Everyone in the world will be selling paper gold short in an effort to make some hay as it's structure crashes. It's called piling on!
This move by Allan is as important as the Washington Agreement because it marks the first time we are forced to action by a "competing" financial system. This game is well known to some and it's outcome is being positioned for. The Gulf producers, Europe and the BIS have been doing so for many years.
How serious is the problem when "steady eddy" Greenspan, the man who has previously only changed rates by 25 point increments in the past, today decides to go a 50 point change.
Even during the LTCM debacle he made only 25 point changes,even if it was 3 of them in quick succession.
You gotta force yourself to write that book...just put it down on paper, a speed demon first draft. The revisions won't be as extensive as you fear. Many apologies in advance if I'm being presumptuous, but I'm only writing this because I admire your work. Heck, a collection of your USAGOLD posts would perhaps be publishable (sic).
A quick question, and I hope you haven't already answered it on a previous post I missed (I'm not here much, anymore). You accept FOA's scenario of Arab support for an EU/Euro gambit (which I suspect is true), but also the necessary caveat that Arab oil's backing of the Euro may not be enough to carry the day for the Euro in its efforts to supplant the dollar. Does your scenario guarantee a role for gold in the future, IYHO? Assuming both the dollar and the Euro survive as major international currencies, could this mean that instead of gold being the alternative to the dollar, the Euro will be the alternative? In other words, instead of restoring gold to its former role as the ultimate money, could the Arab-backed Euro supplant gold re gold's more recent role as the dollar alternative?
A quote from your posting, in reply to mine, reviewed
"And I'm aware of the Rothschild scam after Waterloo. Etc. It's just that "they" don't have nearly that control or power anymore. Things are too complex. There are too many players now days and too many wild cards can bollix up their plans.
Further, it was "their" ancestors who, for relatively short-term gain threw not only us, but their progeny into the paper furnace we're burning in. They had no coherent long-term plans that have held-up very well that I can see."
-----------------------------------------
Quite the opposite my friend; quite the opposite. What we are 'in' today is exactly because their power is greater today. far greater, than ever it has been. It is a network built over centuries. If it were a physical disease, it would be akin to an advance stage of terminal cancer. The long-term plans have held up excellently. Complex the situation is - yes. This is why very few can understand. The complexity is, and has been, integral to its growth and survival.
I believe you have the ability to 'see'. Just sit quietly sometime, free from distraction. Unfetter your mind, and let it expand. You have no doubt seen enough so called 'Mafia' movies. Forget the wide brimmed dark hats, and cigars, or cigarettes dangling from the corner of the mouth and any of the other clich�s.
Think of the structure, then put in a little refinement and expand on it. Think network and globalisation but not just in a present day context. You need to encourage competition between your units - that makes for strength, just so long as there is unity when needed.
You need 'front men� who do not belong the 'inside'. For instance, when the 'Mafia - the Mob' wanted to take over places in Las Vegas, they used Mormon bankers as front men.
Because I have used the word 'Mafia', and referred to some of their doings, do not lock onto this and think my subject is Sicilian mobsters or a la Hollywood gangsters . That is NOT what I am on about. It is the basic principle of organisation I am concerned with here.
Whether in the final analysis, that is, when the agenda has reached its final stage of total world control via economics (and these people do believe they have been charged with this responsibility) it will be a good thing, or a bad thing, I don't know. Maybe it will be a positive. Maybe it will end wars for good. It will almost certainly bring in a form of communism by the back road.
Yes, I know, it all sounds so unbelievable. I can understand anyone not comprehending (or even wanting to). It is a bit like having cancer - do you really want to know, or would you prefer to live out what life you have left free from the knowledge?
The best way to use the knowledge is not to worry about it, or waste your time trying to change things. A greater man than you or I tried to two millenniums ago, and look where it got Him. Use it by 'seeing' where things are going
and recognise the power that is behind it, then use that power to carry you along. Go with the flow. Learn from King Canute and don't argue with the tide.
As I have said, if this is all above you, I understand. One day, I am sure you will.
( Hope this has not been too heavy, it's hardly a piece of
dust on the full story, if it could be told)
IMHO, the "temporary advantage" for Euro zone is in fact a breakout strategy for ME OIL for precisely the reasons you propose. Alternative energy sources (needing infrastructure or not) are in fact waiting in the wings. A way will be found to power this world we live in. This new life gold is taking on will yield incredible leverage to ME gold holders and displace oil as the #1 natural resource. I do believe their endgame is to become a permanent and dominant fixture in global banking within the context of a new monetary regime. Those that have physical gold will participate and ride the coattails of FOA's giants. The Euro zone will never effectively compete economically (long term) with the USA--NEVER. A zebra cannot lose its' stripes. Pain ahead for the US but, we will emerge stronger and hopefully wiser than ever.
I hope you and your family are well, and that matters resolve in a positive and desired-for manner.
I am pleased to see your recent posts, and to learn your "take" on current developments. Your posts cause one to look at matters beyond the parameters of the current mainstream paradigm.
Re Greenspan blinking. Question whether Greenspan is the agent of Ayn Rand's final revenge against mixed-economy pseudo-socialism and the fiat money system. Perhaps he's the ultimate mole-cum-fifth-columnist, subverting the system from within? Perhaps the way to destroy the fiat money system is to inflate it into oblivion? Maybe he's fulfilling his dream and plan, instead of blinking. Just a paranoid thought, upon which to reflect.
"He is the One we should love. He made the world and He stays close to it. For when He made the world He did not go away and leave it. By Him it was created and in Him it exists. Wherever we taste the truth, God is there. He is in our very inmost hearts, but our hearts have strayed from Him. Think well on it unbelieving hearts, and cling to Him who made you. Stand with Him and you shall not fall; rest in Him and peace shall be yours. What snags and pitfalls lie before you? Where do your steps lead you? The good things which you love are all from God, but they are good and sweet only as long as they are used to do His will. They wiill rightly turn bitter if God is spurned and the things that come from Him are wrongly loved. Why do you still choose to travel by this hard and arduous path? There is no rest to be found where you seek it. In the land of death you try to find a happy life: it is not there. How can life be happy where there is no life at all?"
If the story could be told....I'm interested in the whole story as always....By email or post links if you would.....Never to old or wise to learn!
Thanks....YGM
yukongold@yknet.yk.ca
Welcome Aboard!Glad to see your input today and look forward to frequent posts! These guys have been magicians for years as all their "desperate" moves have patched up and kept intact their dollar hegemony games. How long and how many patches ?
Today's "surprise" rate cut by Alan the Greenie ("genie" to some people) makes me think back to 1998 when hedge fund, Long Term Capital Management, was upside down and threatened to take down the whole financial system. With declining stock prices over the last six months, I suspect that some big boys on Wall Street were breathing their last. Bush's meeting recently with Greenspan plus today's "economic summit" in Austin, Texas all add up to emergency action to head off disaster--at least for a while. Remember, in bear markets, you SELL THE RALLIES. And rally the stock markets did do. However, no one noticed that the bond market cratered--down about 2 full points. This is in line with cycle predictions for bonds courtesy of Eric Hadik of Insiide Track newsletter.
Final thought: While the U.S. Dollar did a knee-jerk rally, I suspect that European and Asian money managers are looking at Greenspan's move today as desperation to breathe life back into a moribund economy. Keep an eye on the course of the U.S. Dollar. And how does all of this relate to gold prices? As the Dollar drops, imported goods become more expensive, thus pushing up the CPI. All other Dollar denominated commodities become more expensive, thus pushing up the PPI. From a timing perspective, next week is a full moon/lunar eclipse on January 9th. For whatever reason, markets turn on such events about 82% of the time. My opinion is that gold's day in the sun is just around the corner.
If I'm interpreting properly, ORO suggested in #44964 that Put options were sold by banks to institutional investors (read mutual stock funds). The funds bought these for insurance (a hedge) to offset stock price loses in the event that prices fell. Failing stock prices reflected in the Nasdaq index number would greatly increase the put options' value, offseting stock loses.
Questions please,
Did the liability assumed by the banks from these sales place the banks in jeopardy?
Did the resulting rising price of purchasing these puts (hedge insurance) cause the mutual fund selling of stocks as holding them unhedged was too risky? If so, then are index number derivatives (options) a stabilizing, necessary (as insurance) element of the big money investors (funds)?
ORO's words "Any additional reduction in premiums as a result of reduced volatility expectations would assist in lowering the price of protective put options." Cheap insurance is more affordable than high premium insurance but after the ups and downs of the Nasdaq recently, I would quess both put and call premiums are now very costly. Even so, I have to admit that a well timed S+P or Nasdog put might be lots of fun if Friday's employment numbers are not favorable. Will we see more fund stock selling if index hedging remains too expensive in light of capital returns on stocks?? If so, it would seem the line of least resistence is down as soon as the rally falters.
Also, if A.G. did raise rates because there is a "dead body" about to be discovered (another LTCM?), how long can this kind of news be kept hidden? Faltering point?
One last question, if I may,
If the dollar's strength today was, as ORO suggested, the result of capital flow into stocks, then if stocks reverse lower and retract to just where they were before the rate change, then nothing is gained but the dollar has been weakened by the rate reduction (causing the smile on T.G.'s face). Will the dollar start back down again as soon as the market stops going up?
Any and all thoughts over any length of time welcome, especially from ORO. I hope I haven't misread or misrepresented your thoughts.
Thanks
Rich
... everyone *knows* rates cuts are always inflationary, don't they ???
Trurl: Good post. There's lots of holes in that (continued) hyperinflation argument aren't there. In an exchange with FOA awhile back, traveller detailed very comprehensively the ultimate ramifications of the problems you are zeroing in on. If you missed it, perhaps someone can direct you to where it can be found.
Yourself and Another have always been consistent in your vision of the future. You have consistently maintained that the world will not go back to a gold standard. That particular part of your message has caused me much distress. I attribute many of the problems in the world today to the proliferation of fiat money. For instance, the tearing apart of the social fabric of the United States directly mirrors the proliferation of fiat. And it seems whenever greatness in the past was achieved by different cultures or countries, it was accompanied by "honest" money, and whenever a country declined precipitously in standards of value and the citizens became debauched, it was also the case that the currency was simultaneously being debauched. It seems to me then, that monetary policy greatly influences the attitudes and actions of citizens as well as the health of cultures. Fiat being associated with cultural decline, and "honest" money being associated with cultural ascension. "Golden Ages" occurred when the circulating medium of exchange was "as good as gold."
I know you speak from the perspective of what these "Giants" are supposedly doing and have provided the readers of this forum incredible insights. I am confounded because you speak of gold as wealth, but not as money. In the same way, I am confounded that Doug Noland, from Prudent Bear, who writes probably the most informative letter in the world about credit expansion, and how it will ultimately destroy the world economy, said in a recent offering, "I'm not here to advocate a gold standard." I sat there thinking, "Doug, then tell me, what else on earth can harness unbridled credit expansion?"
While I would rather stand in the Footsteps of Giants than not, I believe strongly that currencies must have backing or their values ultimately decline to zero. Isn't a system of "wealth" denominated in gold, but a commerce conducted by ever depreciating fiat akin to having your cake and eating it too? Are they not mutually exclusive? Isn't this the exact system in place today, except that gold is not recognized as a wealth asset? And if it were, would not EVERYONE want to measure his or her wealth in gold and abandon fiat to an extent? Is this not the reason why gold is "held down" in the first place? If such a system evolves, would not gold become the "true" barometer measuring fiat debasement, relentlessly increasing in value to reflect unrestrained paper money creation?
I have posted quotes in the past from Ayn Rand that accurately depicted the problem. The Austrian School of Economics has accurately described the problem. Representative Ron Paul of Texas, seems to have isolated the problem, as last year he introduced a bill in congress to abolish the Federal Reserve System (how he continues to be re-elected must rank as the eighth wonder of the world, and is a testament to the many friends of freedom he has made). I have posted many quotes by John Meynard Keynes, whose convoluted thinking is used as a blueprint for today's monetary system that benefits the few at the expense of the many. It seems Mr. Keynes, and many other Prize-winning economists have their brains up their sleeve�.. and up to this point, the Euro, as I see it, is the first currency said to exist without ever existing, for nobody has ever seen or touched a Euro. I am reticent, at this point, to think of the Europeans as the "good guys" in terms of reestablishing gold's value despite the following quote from Another.
ANOTHER: "The Dollar is today, strong in nature of a low gold price. Tomorrow, it will be the Euro that will find strength in a low gold price! Perhaps these dollar "gold loans" will be called in to become "Euro gold loans"? Gold priced in many thousands of USD's does not change this currency, it changes your perception of wealth."
Your contention that the "paper" gold market will fail, I think, is accepted by just about everyone, and rightly so, since yourself and Another, informed the world with great accuracy the mechanism that was being used to "corner" gold. I'm on shaky ground here, but I can't perceive what would cause the ultimate default? In other words, who is going to demand the gold and foil the master plan? That plan being discouraging gold use as a measure of wealth, and the obliteration of gold from having anything to do with currency in circulation.
I doubt any political or legal action can put an end to the greed that is concomitant with this Fiat system that reeks of injustice and corruption. I do find solace however, in the knowledge that it contains the seeds of it's own destruction, and that the misguided (just being kind) natures perpetrating it will eventually be found out. They can buy decades as Mr. Greenspan seems to think, but I have no incertitude in stating that one day the world will return to gold backed money. On that day, a new "Golden Age" will have begun.
Easy Al no doubt took his marching orders from his CB bosses. They saw non-performing loans,bad debt exposure,equity liabilities and God knows what else as a financial system on the brink- again. Excessive paper money creates cheap credit, which creates equity bubbles and manias for goods. It is essentially robbing forward production from the economy. We have built and financed millions and millions of homes,cars, and everything. Unless they can figure out a way to be destroyed (wars usually did the trick in the past) they will slow the economy for decades to come. Every rate cut and goosing of the money supply only adds to the hard time the economy must serve. It seems if you could only make one financial decision that would have to suffice a lifetime would you choose a paper asset or gold/silver? While this is preaching to a choir,few people understand they are making decisions that could affect their children and maybe grandchildren. As a side note I would not be surprised to see gold let off its chain and run wild for a while should GATA start hitting raw nerves in discovery. They might try to embarrass GATA by "proving" its free market. Trouble is, you can't put a genie back in a bottle.
Mr. Greennspan's January surprise coming as it did, should underscore the fact that the US economy is in the danger zone both now and in the forseeable future. Smart money knowing that any rate cut however gratuitious and generous will take time to adequately oil the wheels of commerce should take this opportunity to lighten up. I expect a down day tomorrow for that reason and, if that happens, a minor rout for the DOW index to ensue. (everybody's got one)..CM
http://www.fuckedcompany.com/ Easy Al pulled his head out of his *ss long enough today to ascertain that there is no inflation out there anywhere so he cut interest rates. Funny, I guess he missed that piece all over ABC news yesterday about downsizing the packaging contents without cutting the price. Must have missed both of the following items also. Just where has his head been, lately, anyway?
Pricing
Online bank WingspanBank.com, mailed a letter to current customers announcing a number of
"pricing improvements", including a higher balance requirement, higher service fees, new
charges for online bill payment, lower rebates, and longer hold times on deposits. Keep those
improvements coming!
When: 1/2/2001
Company: WingspanBank.com
Dec. 20, 2000 (EIRNS)--A group of Washington State-based industries, including Boeing, one of America's largest companies, last week petitioned the Washington Utilities Commission for emergency relief from high electricity prices. According to Melinda Davison, the group's attorney, one company in the group paid $60,000 for one day's worth of electric power on Dec. 11, 1999. For that same day this year, that company faces a cost of $6 million, an increase of 100 times, or 9,900%, in only a single year. Most of that increase came in the last two months.
Increases of 500%, or 5,000%--even above 10,000%--in electric and gas prices, are and have been occurring across the country during the last year. Since energy is the lifeblood for the economy, skyrocketing prices devastate industry and agriculture, infrastructure, and people... (more)
Loosely organized thoughts that might help you ponder this further, mhchuck
http://www.usagold.com/halldiscussion.htmlWhat you are currently driving at in your (usagold.com msg#: 44980) is an important topic, indeed. So important, in fact, that I instituted the link above (found within the Hall of Fame) as a permanent reference mark for many fine thoughts on several sides of this issue. I encourage you and all others to review this material as time allows, and bring forward your additional thoughts.
As FOA/Trail Guide has indicated his scant time available for posting at the current time, perhaps this link (which contains many of his thoughts on the matter) and my following words will satisfy some of your desire for a dialogue on this.
You said to FOA, "I am confounded because you speak of gold as wealth, but not as money."
In truth, I believe a more accurate appraisal of FOA's sentiment is that "gold", "wealth", and true "money" are akin. It is the term and function of "currency" that is specifically the odd man out. So to correct the sentiment you offer, it seems more proper to say that FOA speaks of gold as wealth and speaks of gold as money, but does not speak of gold as currency. Those are by-gone days for the foreseeable future....but who knows what lurks beyond what is foreseeable?
You ask, "Isn't a system of "wealth" denominated in gold, but a commerce conducted by ever depreciating fiat akin to having your cake and eating it too?"
Marvelous thought, is it not?
Further, you ask, "Isn't this the exact system in place today, except that gold is not recognized as a wealth asset? And if it were, would not EVERYONE want to measure his or her wealth in gold and abandon fiat to an extent?"
In official operations, it has been institutional support of U.S. Treasury securities as assets that has obscured the picture somewhat for what you describe being "the exact system that is in place today". And yet even under the current scenario, we do not see everyone want to measure their wealth in these U.S. bonds and subsequently "abandon fiat to an extent". Reserves (and wealth) serve a purpose that not always meet the objectives and functionality of currency. In practice, we do tend to use "the right tool for the right job"!
You ask, "Is this not the reason why gold is "held down" in the first place?"
While it may look as though gold has been in a 21-year grinding bear market when seen through the traditional "market eyes", (or else look conspired against by "powers greater than thou"), what has transpired over the past half of the century--and particularly the past three decades--can be more aptly be described as the "work out process" of this latest monetary phase of mankind's economic evolution. After the separation from use as currency, it was necessary for gold to be lost and forgotten for a time (and seemingly languish under a mantle of paper) in order to re-emerge in the role for which it is uniquely suited...that of an uncheatable wealth reserve asset.
Such are my thoughts, and to that end, I perceive the future for gold in this new modern usage to be brighter than it has been at any time seen by those who have tilled the fertile soil before us. Change IS good...else we would be yet doomed to the mundane doings of hunters/gatherers.
While George Dubya was in Austin, TX entertaining a few of America's CEO's, Cheeta went ape**** and threw out a 50 basis pointed banana. That is his way of telling George Jr. who is in charge and not to get too big for his britches. However, there still remains the problem of a slowing economy, higher energy costs, declining retail sales, etc. In fact December's retail sales figures come out tomorrow, and this is one of Cheeta's favorite sets of data, so obviously he got a peek at the numbers and he was scared s***less. We are likely to see several more acts of desperation as more bananas are thrown. In other words more rate cuts are forthcoming. Of course there is the developing energy crisis that continues to eat into the pocket books of American consumers. The old chimp is going to be under a lot of pressure to head off stagflation. Consumer liquidity is almost nonexistent as most are simply tapped out. Tomorrow could be interesting. I suspect that Cheeta will soon be throwing whole bunches of bananas before long. I saw that the financial media did their part by trotting out analysts galore to shout loudly that now the bad news was out and everything is just peachy now. Sorry, but I figure if there is one cockroach, then there are likely to be many more! Besides, nothing has changed. The fundamentals still stink. The only question left is now that the FED has tossed out a banana, what will the monkeys at the ECB do now?
GOVERNMENTS across Europe are quietly preparing to trap money-launderers and tax evaders when a mountain of cash emerges for exchange into euros on the launch of the new currency next January.
France, which has a long tradition of cash-hoarding by bank-shy citizens and tax-averse tradesmen, is leading the way with plans to monitor the origin of big sums when people turn up with suitcases of francs in the six-month changeover period. As much as �15 billion, half of all notes in circulation, are believed to be stuffed under French mattresses, in drawers or in private safes, according to banks.
Financial institutions and the tax authorities are hoping to reap a windfall from the currency changeover. Tax authorities and banks in all 12 euro states are bracing for the emergence of billions of pounds in hidden cash when citizens are forced to convert notes before they become worthless. If handled right, the exercise will provide a windfall opportunity for banks to collar savings and divert them into investment and also for the taxman to nail "dirty" money.
However there are fears that the confusion of the mass changeover will be used by criminals to launder illicit cash holdings. The impact could be spectacular in Italy, where a fifth of the economy is officially estimated to run on cash, much of it beyond the reach of banks and the taxman. The country's antiquated banking system will make it hard for the authorities to keep tabs on people turning up with suitcases of lire, Italian officials say. In Germany, which has a smaller black economy and a tightly regulated banking system, officials still fear that criminals could use the confusion of the changeover to launder cash.
"It is going to be boom-time for drug dealers and criminals trying to shed their holdings," a Berlin official said. Belgium, which also operates heavily on cash, is taking steps to check the origin of big sums.
France, with its old tradition of cash-hoarding, is taking the toughest measures to monitor the expected flood of big-denomination franc notes, which cease to be legal tender on February 17 next year. Thrifty French countryfolk and cash-only tradesmen were told yesterday to expect attention from the taxman. Keeping a nest egg in a bas de laine, or woollen stocking, is still popular among older French, especially in rural areas. Up to 80 per cent of all Fr500 (�50) notes are said by the Banque de France to be out of circulation. With French taxes among the highest in Europe, a substantial share of the banknote mountain is assumed to be held by artisans and small businessmen who operate au noir � on the black � to stay free of the taxman and the VAT man.
The franc-euro exchange will be free, but the catch for illicit cash-holders is that all but relatively small sums must transit through an account, even if withdrawn immediately in euro notes. The ceiling on non-account conversions has not yet been fixed.
Consumer groups are fighting the rule on transit through accounts, saying it is unfair. The banks are chafing under sweeping laws that require them to notify authorities of all "suspicious" transactions.
The campaign to acquaint France with the future currency took off this week. Citizens are being advised to get used to buying a baguette for 61 cents rather than four francs.
Polls show the public and small businesses to be resisting the idea of scrapping the franc, but the Government is banking on the revival of the euro against the dollar to help to convince a reluctant country that the changeover will be worth the effort.
By David Buchan and Ruth Sullivan in London
Published: January 2 2001 20:40GMT | Last Updated: January 2 2001 22:57GMT
Saudi Arabia, OPEC's leading producer, on Tuesday called for a big cut in the cartel's oil production this month, but the move produced only a brief rally in the oil price. The call for a cut of 1.5m barrels a day appeared to convince the oil markets that OPEC will reduce production quotas when it meets in Vienna on January 17, but that this would not necessarily halt a slide in the price from last October's peak of $35. After a weekend meeting of the Gulf Cooperation Council, which also includes OPEC members Kuwait, the United Arab Emirates and Qatar, a Saudi official told the Reuters news agency that GCC leaders had told their ministers "to do whatever is needed to achieve the targeted price of $25 for the OPEC basket". To achieve this, a cut of 1.5m barrels per day would be needed, the official said.
The size of the proposed cut took some traders by surprise. "It is a dramatic proposal, as we had been expecting calls for cuts of 1m barrels a day," said Peter Gignoux, a trader at Salomon Smith Barney. However, the Saudi call failed to shake market belief that world oil supplies are adequate or even excessive. Brent February futures on London's International Petroleum Exchange rose 98 cents to $24.90 in mid-afternoon trading before falling back to $24.46. On the New York Mercantile Exchange oil futures jumped 54 cents to $27.34 in morning trading before falling back to $26.87 at midday. Other members of the 11-nation OPEC cartel, including Iran, Venezuela and Libya, have already stressed the need for production cuts to pre-empt the seasonal decline in oil consumption next spring, making agreement on cuts this month highly likely. The US has increased pressure on Saudi Arabia to maintain oil output, but Washington's leverage will be weakened by the imminent change of administration. The Saudi official's reference to a target of $25 for the OPEC basket implies a higher price for the Brent benchmark crude. The OPEC basket, composed of the crude oils of the cartel's producers, traditionally sells at a quality discount to Brent. It traded all last week at under $22 per barrel. A cut of 1.5m barrels a day would reduce production for the 10 OPEC members with quotas by around 5 per cent to just over 25m barrels a day. Iraq is not covered by OPEC quotas, because it is restricted by United Nations sanctions.
Black Blade: Hydro-Carbon Man is about to find a bit of a supply problem now that OPEC is poised to take control of falling prices and slowing demand. Higher prices will have to be passed along in the current environment, but unlike the inflationary magic of the "disappearing ounces" of grocery items that were exposed in the media over the last couple of days, the petroleum and NG dealers can't get away with lighter gallons, liters, and cubic feet.
Oil Demand Decreasing, and Inventories Rising! (at least until revised next week)
--NY Feb crude down 25c on unexpected stockpile increase
--API: US crude stocks up 64,000 barrels in latest week
--API: US distillate stocks up 3.517 mln barrels in latest week
--API: US gasoline stocks down 2.677 mln barrels in latest week
--API: US refineries operate at 93.0% in latest wk vs 93.4%
--APIs imply US distillate demand 3.73 mln bpd vs 4.35 mln
--APIs imply US gasoline demand 8.62 mln bpd vs 8.58 mln
By Peter Rosenthal and John Troland, BridgeNews
New York--Jan. 3--The American Petroleum Institute (API) reported Wednesday unexpected increases in crude oil and distillate inventories, sending crude and heating oil prices lower in electronic trading. Crude stocks increased 64,000 barrels per day and distillates supply grew 3.5 million barrels, despite cold weather in the Northeast, the biggest heating oil market. Gasoline inventories decreased 2.677 million barrels, while refinery operations were slightly lower at 93% of capacity, a 4-basis-point decrease from the prior week. At 1721 ET, NYMEX Feb WTI crude was down 18 cents at $27.82 a barrel. Feb heating oil was down 183 points at 84.15 cents a gallon and Feb gasoline dipped 20 points to 80.80 cents a gallon. The data, for the week ended Friday, were delayed 24 hours by the New Year's Day holiday. The U.S. Department of Energy will release its weekly inventory data on Thursday after 0900 ET. Crude inventories had been expected to decline by 2.7 million barrels, while stocks of distillate fuel, which include heating oil and gasoline, were seen declining as much as 2.5 million barrels, according to brokersand analysts estimates.
CRUDE: Up 64,000 barrels
The rise in crude stockpiles is attributed to a 417,000 barrels-per-day increase in imports and a slight 71,000-bpd dip in refinery runs. However, based on those figures, the data indicates that crude inventories should have risen more than 3.1 million barrels, a broker said. Imports rose to 9.184 million bpd, from 8.767 million bpd the previous week. The largest rise in crude inventories was on the Gulf Coast and is consistent with the increase in imports. Stockpiles rose by 2.2 million-barrels in the region. Crude stocks also rose by 121,000 barrels on the East Coast.
In the Midwest, which includes the NYMEX delivery point for light, sweet crude oil futures at Cushing, Okla., crude stocks fell 1.863 million barrels barrels, helping to widen the year-to-year deficit there to 5.1 million barrels, from 2.8 million barrels the prior week. The strong drop in stockpiles caused one broker to suggest that the Feb/Mar WTI spread could widen 20-30c per barrel from its present level of a 73c premium in favor of February. Crude stocks also fell 723,000 barrels on the generally unrepresentative West Coast region as refinery operations there increased
2.1 basis points. The overall rise in crude inventories caused the year-to-year deficit in total stocks to narrow to 4.1 million barrels last week, from 4.9 million barrels in the previous week.
GASOLINE: Down 2.677 million barrels
A decrease in East Coast stocks was complemented by another large draw at the Gulf Coast, the largest refining center. Production dipped but was offset by higher import levels. Domestic gasoline output fell to 7.82 million barrels per day from 8.0 million bpd a week earlier, while imports dropped increased to 420,000 bpd from 174,000 bpd. Demand was steady above 8.5 million bpd. The drawdown narrowed the surplus to year-ago inventory levels at 3.25 million barrels from 5.2 million a week ago. Reformulated gasoline inventories on the East Coast, the basis for the NYMEX futures contract, rose 78,000 barrels and but are now only 3.4 million barrels above year-ago levels, versus a 5.1-million-barrel premium the previous week.
DISTILLATES: Up 3.517 million barrels
Demand for distillate fuels saw a major drop of 620,000-bpd from the previous week's 4.35 million- bpd level. This coupled with a 287,000-bpd increase in imports, to 514,000-bpd is the major reason distillate fuel inventories rose, one trader said. The largest increase in distillate stockpiles, 1.925 million barrels, came on the East Coast, the largest user of heating oil. However, while total distillate fuels increased on the East Coast, high sulfur distillate, or heating oil, actually declined by 458,000 barrels. Increases of 799,000 barrels, 148,000 barrels and 762,000 barrels were also recorded in the Midwest, Rocky Mountains, and the West Coast, respectively. The East Coast build helped narrow the year-to-year deficit to 7.3 million barrels from the previous week's 11.0-million-barrel level. The only drop in distillate inventories was on the Gulf Coast, where they fell only 117,000-barrels. Overall distillate fuel inventories are now just 6.1 million barrels
below the previous year's level of 124,255 million-barrels.
REFINERIES: Down 0.4 basis points
Overall refinery rates dipped slightly, although all regions outside the West Coast saw a decrease. Midwest rates dipped 2.4-basis points as Farmland Industries shut several units at its Coffeyville, Kansas plant for unplanned work on Dec. 23. Valero shut 88,000 bpd of capacity at its Texas City plant, which may have depressed rates in that region.
Black Blade: As the previous post would indicate, it is no wonder that OPEC wishes to tighten production.
New York--Jan. 3--NYMEX Feb Henry Hub natural gas futures ended down 14.4 cents at $8.220 per Mbtu amid forecasts for warmer weather in the key consuming regions. This is despite a larger-than-expected withdrawal in the latest American Gas Association storage report. The American Gas Association reported U.S. gas storage at 1,729 bcf for the week ended Dec. 29, down 209 from the previous week, and down 708 from the same period of 1999. Observers said the number was bullish because it was larger than both the 1999 draw of 133 bcf and the five-year average draw of 135 bcf, but that the data was overshadowed by forecasts predicting warmer temperatures in the key consuming regions. If these forecasts hold true, then the next few draws on storage are expected to be well below this week's withdrawal. "They've been screaming about supply, but the shortage is in the market," said Guy Gleichmann, senior trader at FSG International. "This number was significant, yet the weather is weak." The AGA data appears to have taken a back seat, at least temporarily, to the weather forecasts, which continue to predict warming temperatures in the Midwest and Northeast and a decline in industrial demand caused by high natural gas prices. Gleichmann added, however, that the natural gas shortage remains a serious problem with supplies about 29% below year-ago levels. "Fundamentally, the supply shortage is nothing to sneeze at," he said, adding, "1,729 is real critical because of what lies ahead."
Black Blade: NG Storage Levels are falling fast and winter is far from over. We might dodge a bullet, but then again who knows. There aren't any more spare drill rigs, not enough engineers and geologists and drill rig crews anyway, so an energy crisis is a foregone conclusion. If not this year � certainly next year. The NG producers, power plant operators, and politicians are all asleep at the wheel as we go barreling over the cliff.
Peoples Republik of Kalifornia on Verge of Power Collapse (The Trials and Tribulations of a Third World Socialist Republik)
--Calif. PUC order proposes 1c/kWh SoCal Edison, PG&E rate hike
--Calif. PUC proposed power charge to be based on usage
--Calif. PUC power rate hike seen as temporary measure
--Calif. PUC power rate hike in effect for next 90 days
--Calif. PUC draft order proposes 9% residential rate hike
--Calif. PUC order proposes 7% rate hike for small businesses
--Calif. PUC order proposes 12% rate hike for medium commercial users
--CPUC order proposes 15% rate hike for large commercial users
--CPUC order proposes 15% rate hike for industrial users
--CPUC rate order does not end PG&E, Edison rate freeze
By Christine Cordner, BridgeNews
San Francisco--Jan. 3--The California Public Utilities Commission released this afternoon a draft order that would allow Southern California Edison and Pacific Gas & Electric to raise electric rates for the next 90 days by 7% to 15%, less than the state's two biggest utilities had sought. The commission will vote on the order Thursday after hearing final arguments later today. The increases amount to a hike of 1 cent per kilowatt hour based on usage for retail customers. In a statement, the CPUC said the order would grant temporary increases pending a detailed investigation of utilities' finances and market conditions, a review which could result in customer refunds. The order would raise retail rates by about 9% for residential customers, 7% for small business customers, 12% for medium commercial users and 15% for both large commercial and industrial customers. The raises are far below the 26% and 30% rate increases sought by Pacific Gas and Electric and Southern California Edison, respectively. Shares of both utilities dropped sharply after the news. At 1454 ET, Edison International shares were down 1 5/8, or 10.83%, to 13 3/8. PG&E Corp. shares were down 1 7/16, or 7.35%, at 18 1/8.
The utilities said they will respond to the draft order at the hearing. The commission said it intends to continue its investigation and would limit the rate increase to 90 days, "pending further hearings." The CPUC said part of that investigation will be the utilities' audits. Pacific Gas and Electric and Edison claim to have incurred more than $8 billion in wholesale electricity costs above the income they receive from their customers. The commission said it has hired independent auditors "to verify the veracity of these and other claims related to the utilities' financial health" and is using the 90 days to "perform a comprehensive review," including the utilities, their holding companies and their affiliates.
Black Blade: Well the other shoe dropped as the Utes said that this is not good enough, and unless they get relief from government action, then they will begin power rationing and begin bankruptcy proceedings. Just imagine, Kalifornian housewives not having access to their soap operas, and hubbies with access to their porn-on-line. Horrors! They knew this day was coming, so have no pity for them. "And the Grasshoppers danced, sang, and played all summer�"
NY Precious Metals Review: Feb gold trims loss after 1-mo low London--Jan. 3--COMEX Feb gold futures managed to trim some of their losses, ending down only 70 cents at $269.30 per ounce after initially extending Tuesday's fall and slipping to a one-month low of $267.60. Like Tuesday's session, Wednesday's trading proved to be another puzzle, as gold price moves appeared to defy the usual market logic.
Black Blade: No Kidding!
Fed cuts interest rates 50 basis points in surprise move Washington--Jan. 3--In a surprise move Wednesday, the Federal Reserve cut interest rates by a dramatic 50 basis points amid mounting fears that the slowdown in the U.S. economy may turn into a recession.
Black Blade: Desperation! Hard landing is in the cards as desperate moves such as this are geared to suck the last few pennies out of investors� pockets as they throw themselves headlong into another "suckers rally." All that cash will go to "Money Heaven."
US DLA offered 2,709.338 oz palladium on Wednesday New York--Jan. 3--The U.S. Defense Logistics Agency offered a total of 2,709.338 troy ounces of palladium from its Web site Wednesday. No material was sold Tuesday.
Black Blade: A spit in the ocean.
Europe Precious Metals Review: Gold capped at $270, palladium up London--Jan. 3--Spot gold remained capped at U.S. $270 per ounce through the European morning's trade after Tuesday's losses, maintaining a sideways path between $268 and $269. Overnight it had reached a high of $269.80 on Australian dollar strength. Silver was weaker, reflecting gold's stance. Palladium was stronger as the market continues to wait for news on Russian deliveries, while platinum was flat.
Black Blade: No deliveries of Pd are coming out of Russia!
http://m1.mny.co.za/MGCurve.nsf/Current/8525686A00324CF5422569B3005F5E9B?OpenDocument A different spin on the appointment of Bobby Godsell as chairman of AngloGold is that he's being kicked upstairs. The official view, however, is that the move is a thumbs up for management's strategy and that current AngloGold chairman, Nicky Oppenheimer, has more onerous duties on the Anglo American board and, for course, as chairman of diamond giant, De Beers. But given AngloGold's poor operational performance of its South African mines this year, it could be argued that Godsell's intellect and strategic nous is best suited to the role of chairman. Other skills that recommend him to the new role is his ability to motivate those around him. The flip-side of this argument is that AngloGold also needs a bred-in-the-bone miner to get the mines straight. Godsell said recently that the company could well appoint an operating officer and one is tempted to think that AngloGold could seek to recruit former director and current Gold Fields MD Ian Cockerill. Cockerill was a kingpin behind AngloGold's impressive productivity improvements in the mid-1990s, and he has since done a sterling job at Gold Fields. Although Cockerill is not the only expert miner, it's difficult for South African miners to find candidates within South Africa. One rising star is Gordon Miller who, at a relatively youthful 36 years old, has an excellent reputation working through the ranks of Western Areas and now Placer Dome South Africa. But Placer Dome have snatched him away for good placing him in strategic development at Placer Dome's head office in Vancouver. It's hard work for South Africans to attract skills. Just ask Impala Platinum who are still on the lookout for a chief executive to replace Steve Kearney who resigned earlier this year. Then there's Harmony Gold's Bernard Swanepoel, but the last time I wrote about Swanepoel being wooed away, a colleague of mine ended up in hot water ... so I won't say anything.
By: Pitcher
Black Blade: It is true that mining companies are usually run by bean counters that don't have a clue about the mining business. It takes experienced miners to run mining companies. Unfortunately, shareholders do not understand this and they tend to demand CEO's with MBA's. That might work with some "ordinary" business, but not with an industry as unique as gold mining. That is a reason so many gold producers went tits up, and many more will also do so. As far as Bernie Swanepoel being wooed away from Harmony � I hope not. Though I am intrigued about what would happen to Anglos hedging policy if it were to happen.
http://www.mrci.com/qpnight.htmhttp://www.mrci.com/qpnight.htmThis is interesting, Euro is back up +1.51 at 94.70, and other currencies except the yen are higher against the USD. The USD index is down again at 108.90. Futures are down as well. However, gold is still comatose.
Trail Guide/FOA: I am a small placer miner and own physical gold ( in most all forms) and also un-hedged mining company shares in equal amounts. I have a problem understanding how Gold will have a tremendous value and that this will not also be the case with un-hedged mining companies that produce the very substance that you say will be so valuable.If we hold physical gold in a safe place to be pulled out for use when needed , what makes the gold I hold better than the gold that will be poured into a bar on the same day in the future? Will it not have equal value in whatever is being used as the medium of exchange . I can see where physical may out perform shares ,and I also can see where hedged mines can go bust , but I must be missing something here. Are you saying that mining will be outlawed in the future? Or will it be performed only by a world government of some sort and all the people that own the mines can kiss their wazoo? I hope when time permits that you can shed some light on this for me. I know your time is more presious than gold right now and I pray that things work out for you and your family.
"Your gold history lesson reminds me of what I consider to be one of the great open questions in economics," writes Porter Stansberry. "How does Nixon's action - removing the dollar from the gold standard - effect the fundamental monetary conditions you mention in your story?"
Porter's position, shared by many investors, is that gold has been stripped of its monetary role...and left to respond to market forces like any other commodity. Under normal conditions, like other commodities, time and technology should reduce the cost of acquiring gold, increase its abundance and lower its relative price. In times of deflation, the price of gold, along with copper and pampers, should fall sharply. In times of inflation, gold should rise in price.
In the 1930s, the only period of significant deflation since the establishment of the Federal Reserve System early in the century, the price of gold rose. Gold was still money then, according to Porter's view.
But in 1968, the `gold pool' was closed down. A person could no longer trade his paper dollars for gold on the London market. Then, 3 years later, Nixon `closed the gold window' at the Treasury - so foreign governments could no longer trade their dollar surpluses for gold either. Since these two actions, gold has not played an official monetary role.
But to Porter's assertion of fact, that `gold is no longer money' I reply, flippantly:
"Who says?"
To his anticipated response: "The most powerful government on the face of the Earth, the world's only remaining super- power and the custodian of the most successful monetary brand in history..." I retort:
"So what?"
For all his many talents and virtues, it is unlikely that Richard Milhouse Nixon could have achieved what no emperor, dictator, or elected official has been able to do since the beginning of time: eliminate gold as a monetary competitor. Many have tried. But gold, though malleable, is unyielding in its monetary rectitude. An ounce of gold is an ounce of gold. It is neither more nor less than it appears to be.
Paper money is a great aid to politicians. It makes it possible for them, said President Hoover, to confiscate "the savings of the people by manipulation of inflation and deflation."
"We have gold," he added, "because we cannot trust governments."
Have governments become more trustworthy since Herbert Hoover left office and Bill Clinton entered therein? I will leave that to you to decide, dear reader.
Paper currencies are, like so much else that issues from politics, subject to persuasion, ambiguity and financial gerrymandering. As a result, paper currencies are very useful for creating booms and bubbles - they can be readily multiplied and distributed.
"If your view of gold being a safe haven in times of deflation is correct," Porter continues, "then it would stand to reason that gold prices should fall during inflationary periods, right? That's how gold prices have always worked throughout history. See Davidson's work from the August 1997 issue of Strategic Investment. He traced 400 years of gold prices...up to 1970...and found conclusively that gold went up in purchasing power during deflation and down during inflation."
Agreeing that gold has acted as a hedge against deflation from the time of the Flood to the Nixon Administration, Porter brings us up to date: "But the facts since 1971 seem to indicate exactly the opposite. Gold went from $45 to $850 in the 1970s in the midst of an inflationary crisis."
"My view," says Porter, "is that Nixon's action, and the structure of the US economy - an economy based on credit, not gold - turn the historic relationships upside down. Essentially the monetary conditions that we used to call inflation are now deflation."
Let us stop here or we are doomed to wallow in confusion for the rest of this letter. The terms `inflation' or `deflation' refer to the rise and fall in the supply of money. The increase or decrease leads to an corresponding movement in the prices of goods and services. As the money supply inflates, prices rise. When the supply of money decreases, prices fall.
If the supply of gold is inflated - whether you call it money or not - it will have the same consequence...each ounce of gold will buy less of other things. This is what happened when, for example, Spanish explorers began colonizing the new world and sending ships back to Spain laden with gold.
Inflation lowers the value of whatever is inflated: whether it is paper currency or gold. Deflation, on the other hand, diminishes supply and increases value. But is it possible that a decrease in the supply of dollars could produce a counter effect - an increase in the supply of gold? When the supply of dollars declines - a deflation of the money supply - will gold act like money and rise against other goods and services? Or will it act like any other commodity...and fall?
Is gold still money, in other words? Or is it just another commodity? And to those questions, I reply, confidently: Yes. Gold is both.
I pray that if it is going to happen anyway, that the whole
craphouse burns up today, because the whole panorama from Greenspan to debt to fiat to paper gold to energy etc.,etc.
ad nauseam is getting real BORING.
The kind of World we live in is one in which every night
anyone who is alive goes to bed in a diverse menage, with a common theme of: OUR GANG WILL GET YOU.
It's time to rethink the rules: the consumer vs. the environmentalist
From Steven King's PetroDispatch Consumers are about to get an unpleasant surprise in their mailboxes, a fat bill from their natural gas company. This winter, natural gas will cost homeowners who use it about 40% more than last year. In the Midwest, the average family will pay more than $800 this winter to heat the home. And almost everyone will be hit with bigger bills as higher prices for gas, which now supplies a quarter of the nation's energy, work through the economy. That's all thanks to a short-term supply problem. Extraordinarily low prices a few years ago discouraged drilling. That supply cutback is causing today's price spike, and only now is the industry ramping up production.
But an equal part of the problem has been the federal government, who needs to get its regulatory house in order. On the one hand, the government champions the use of natural gas as a cleaner alternative to coal and oil. On the other, it sharply restricts access to enormous supplies out of environmental concerns. If one side or the other doesn't give, consumers will find natural-gas prices on the permanent high side. Compared with other energy sources, natural gas is relatively benign to the environment. It produces half as much greenhouse gas as coal, for example, and almost a third less than oil for the same amount of energy. The result is that almost all new electrical generators are powered by natural gas, roughly 70% of new homes built are heated with it, and city buses and car fleets increasingly run on it.
But while demand for natural gas is expected to climb 45% during the next two decades, getting access to more gas is another story. Roughly 214 trillion cubic feet of gas -- a decade's worth at current consumption rates -- is off limits to drillers. A moratorium forbids drilling off both U.S. coasts. More than half of the identified natural-gas supply is blocked in the Gulf of Mexico. And overlapping regulations from several federal agencies on federal lands in the West make exploration for much of its gas impossible. But still the environmentalists don't seem to care. Carl Pope, executive director of the Sierra Club, believes that reducing consumption is the only answer. "Increasing supply doesn't require drilling our wilderness and destroying the irreplaceable. We can find quick relief by tapping into existing wells now sitting dormant. Many wells were capped when recovering the remaining gas became too expensive. Today's prices give gas companies an incentive to recover the rest."
He still clings to the false rhetoric: "Gas drilling brings problems attendant with oil drilling: fluids and drilling muds pollute the ocean and landscape, and sprawling on-land industrial production complexes destroy fragile wildlife habitats. In addition, natural-gas-drilling accidents threaten people and wipe out wildlife. Drilling for natural gas can release pockets of poisonous hydrogen sulfide, called ''sour gas.'' Across the USA, communities have suffered when sour gas clouds from local wells have leaked into town, burning residents' lungs. The leaks can be lethal to wildlife."
Instead, the public should listen to a recent Energy Department report that stated, "advances in drilling technology in recent years allow gas to be recovered with minimal environmental harm. Horizontal drilling technology, for instance, lets a well dug in one place reach gas supplies miles away. Better detection technology minimizes noise pollution. Rigs are smaller and less intrusive." That same report also urged the federal government to take a more flexible approach to bans and restrictions, and called for greater coordination among regulators.
That's what Canada is trying to do. Its natural resources department says the nation is trying to accommodate multiple uses of sensitive areas, including gas drilling, by getting interested parties together to work out agreeable terms. Already Canada has a natural-gas well just north of Maine, where drilling is strictly forbidden. Ironically, the well supplies gas to New England. So far, however, Canada's prudent approach hasn't caught on here. There has been little talk of opening the oceans to any gas drilling, and little awareness of how environmental rules conflict with the need to boost natural-gas supplies. That could change under a Bush administration. Last week President-elect Bush called boosting natural-gas production a top goal, and officials in his camp have said that means looking at areas currently off limits to drilling.
Black Blade: No Energy - No Economy. Learn to live like the Amish and then barter for trade. Costs for energy are rising and it's only beginning. PMs should be a part of ones investment portfolio because the energy costs will severely impact the economy and PMs will act as portfolio insurance when Cheeta's plans fall apart.
Palladium is up +$3.00 at $978.00/oz, and Platinum is up +$20.00 at $634.00/oz. Unfortunately gold and silver are still comatose. Currencies continue to gain against the USD. Market futures are all in negative territory. Could be a reversal of yesterday's fortunes.
Interesting reparte'. Seems though, that several essential factors have been ommitted by both parties. I will list them:
-- Gold increases; population increases too;
-- Role of dollar as a reserve currency for world oil supply; Affect Euro will have on same;
-- Was gold demonitized or just taken off the radar screen? Fact is, it is treated as both a commodity and a currency. Don't look at their words, rather their actions;
-- The affect of the "gold-carry" trade and how it would affect the price of gold needs to be seriously considered.
-- The action of the Press anti-gold sentiment campaign orchestrated by bullion banks and others who wish to have one believe gold is demonitized: look at who is buying gold; not selling it;
-- The ESF's role and the Bank of England Gold Auction; and the Suisse gold sale on the price of gold. Also understanding the motivation for these sales. Again, who are the buyers.
-- High grading practices by current miners and its future implications on supply.
-- Lack of exploration currently underway.
-- Understanding paper gold and gold leasing practices and how those are engineered or devised.
Once your friend and you take up the above and incorporate that into your models, only then will we all get a more accurate picture of what is reall going on with gold as money; gold as commodity.
You know, yesterday's Fed move was an incredible act. Let's talk:
Fed sees markets (Duck, Dow, S&P) working there way down. They see stats of all sorts, they have a December meeting and decide to leave rates unchanged. Going into the new year, they announce a fifty-basis point drop in short-term rates in the middle of the trading day, which causes the 7th record Dow rise in history with recrod high volume; the Duck has a record high gain of 14% and the highest volume day ever. Some stocks are up 25 plus %. Hmmm.
Today, the futures are all down.
What do you call the act of putting two electronic devices on the chest to restart the heart? Any takers?
Yet, the pundits on the CNBC and CNNs all talk about the DOW and Duck are going to be ahead for the year because their research shows that in the past when these methods were applied, the year ended higher. Everyone was happy, oh so happy.
Doesn't anyone on those shows live in Seattle, where it rains alot? Are they helpless to figure out that they are dealing with a never-before-seen situation that requires thinking way over the curve and not just ahead of it?
Don't you just feel like saying to them, "Come on now, don't you see what is going on? The dollar is in trouble; we have overspent our currency; we have competition now; we must act differently this time; things have changed; don't you get it?"
These pundits are using math and models from what worked before; the Fed is the answer. Well, I guess we are about to find that out. Can the Fed bail us out? They think so.
Frankly, this would appear to be an issue of credibility. AG was under a lot of pressure to lower rates. The press was lambasting him for not doing it in December. Yesterday he fired for maximum affect and the futures are still down this morning. Well, let's wait 30-days and try again and then again and again. Hey, what about the value of the dollar throughout all this? Shouldn't we be watching that too?
Date: Thu Jan 04 2001 03:06
mozel (@Gold and Yer House Mortgage) ID#357270:
Copyright � 2000 mozel/Kitco Inc. All rights reserved
"Regardless of where they are deposited, London, Bahrain,
or Singapore, and regardless of who owns them, Americans or foreigners,
Eurodollars never leave the U.S. This can be illustrated with the following example.
Suppose AT&T draws a check for $5 million on its New York bank, Chase, and deposits it at a London Eurodollar bank. All that has happened is that the ownership of 5 million U.S. dollars has passed from the AT&T to the London bank in return for a Eurodollar time deposit. The balance sheet of the London bank shows a deposit at Chase balanced by a liability, the time deposit credited to AT&T. The balance sheet at Chase shows that it has traded a deposit liability of $5 million from AT&T to the London bank.
Since that money earns no interest at Chase, the London bank will not want to keep it on deposit there. Suppose it uses the funds to make a loan to duPont that banks at Morgan. Chase will show a decrease of $5 million on deposit at the Fed and a decrease in liability of that amount to the London bank. Morgan will gain that deposit at the Fed and an equal liability as a deposit for duPont. The London bank's balance sheet will show a loan of $5 million to duPont balanced by a time deposit owed to AT&T.
Note that throughout both transactions there was no change in banking system reserves at the Fed, and the $5 million remained on deposit at a U.S. bank. A somewhat more involved analysis would show this to be true even if the Eurodollars had been lent to a foreign corporation. Unlike domestic U.S. banks, Eurobanks cannot create credit money in U.S. dollars through the act of lending. Their lending only transfers ownership of deposits at U.S. banks.
For U.S. banks, another important distinction between their domestic and Euro operations is that no reserve requirements and no FDIC premiums are imposed against their Eurodollar deposits. Thus they can invest every Eurodeposit they receive. The Euromarket operates outside the control of any central bank.
Banks accepting Eurodollar deposits use the dollars to make two sorts of investments, loans and interbank placements.
All such placements, like other Eurodeposits, have fixed maturities and
bear interest. The rate at which banks in London offer Eurodollars
in the placement market is referred to as the London interbank offered
rate, LIBOR for short.
The general practice is to price loans at LIBOR plus a spread. On some term loans, the lending rate is fixed for the life of the loan. By far the more usual practice is to price loans on a rollover basis. This means that every three or six months, the loan is priced at the prevailing LIBOR for 3- or 6-month money plus the agreed-upon spread.
Source of Eurodollar Funds
The pool of funds that forms the basis for the Eurodollar market is provided by a wide range of depositors: large corporations ( domestic, foreign, multinational ) , central banks and other government bodies, supranational institutions such as the Bank for International Settlements, and wealthy individuals. Most of the funds come in the form of time deposits with fixed maturities.
The banks also receive a substantial amount of call money. A call account can be a same-day value account, a 2-day notice, or a 7-day notice account. The going rate for call money is pretty much tied to the overnight Euro rate, which in turn is tied by active arbitrage to the U.S. Fed funds rate. The main attraction of a call deposit is liquidity. Time deposits pay more, but a penalty is incurred if such a deposit is withdrawn before maturity. Call money is likely
to average about 10% of a bank's total deposits.
Lender of Last Resort
A question that troubles some in the Euromarket is: Who is to
act as the lender of last resort? This really involves two separate
questions: Who lends if the supply of Eurodollars dries up?
Who lends if the solvency of a major bank in the Euromarket is threatened?
Dollars can't disappear, but they can move from center to center.
It's possible, though very unlikely, that dollars in the Euromarket could
dry up because the holders decided to move their deposits from banks in
Eurocenters to banks in New York. Thus foreign banks could face a
liquidity crisis. To protect against any such risk, many have negotiated standby lines with U.S. banks.
Central banks have discussed at length the question of lender of last
resort to the Euromarket, and have concluded that each looks after its
own. Thus the Fed is the appropriate lender to a U.S. banker whether
its troubles arise from its New York or London operations. Other
central banks are expected to stand behind their own domestic banks both
at home and abroad."
Geez, Adjustable Rate Mortgages are now tied to Libor.
If there is a liquidity crunch in this eurodollar scene, an avalanche of paper gold will result
seem to have taken on a slightly different bent on this Euro thing. TG is still on track for a reserve currency shift in progress from Dollars to Euros. ORO seems to be saying that such a shift will be temporary because as oil is priced higher in dollars, the alternative energy sources will come on line eventually making the Middle East - Euro connection less important as they technologies take hold and it will not revert back to ME oil once that change takes place. This macro, future talk is good for trending long term but it sure doesn't help much in the day to day volatility of the market other than to know that the volatility is a result of the above unfolding. So when presented with the question, when will phyical gold rise, TG seems to be saying, once paper gold dies. Whe is that? This year it would seem as that is when he (or she) is predicting that the dollar will be equalled or overtaken by the Euro as the world's oil reserve currency. In progress... as they say.
mozel (@Gold Miner Income = Derivatives Income + $ Exchange Price of Gold ) ID#153126:
Copyright � 2000 mozel/Kitco Inc. All rights reserved
"Euro dollars in meltup killing derivative mkts, there is no way you can unwind/delta hedge trillions of dlrs of exposure in a mkt moving 15 to 25 pts a day as Eurodollars have been the last few weeks." Homestk Kid
Where is the eurodollar rate for the forward price of gold posted ?
Behold: "In general, if the spot price is S, the forward price is F ( T ) for a time-horizon of T days ( up to a year ) , the eurodollar rate is r, and the gold lease rate is r*, we have the relation
F ( T ) = S [1 + r ( T/360 ) ] / [1 + r* ( T/360 ) ]."
If the eurodollar rate rises, more forward sales will pour from the miners and depress the $ exchange price of gold. If the eurodollar rate rises to 20%, there will be a flood of paper gold onto the "market".
NEW YORK (CNNfn) - U.S. stocks are poised to beat a hasty retreat Thursday morning, as investors step back from record gains inspired by a surprise cut in interest rates by the Federal Reserve. While not an unusual reaction to a day of such sharp advances, the expected sell-off calls into question whether the market will eventually continue to rally or revert to its recent gloominess, which was powered by corporate result warnings in a slowing economy. While pleased with the rate cut, done to help save the economy from a profit-sapping slowdown, experts note that the move does not erase the facts that manufacturing has slowed, companies have reduced capital spending and consumers have reined in their buying plans.
The Nasdaq 100 futures fell 41.50 points to 2,488 in early trading. That put the futures 70.28 points below fair value, a benchmark set daily by traders based on future contracts and their underlying stocks, meaning traders expect a lower open for the Nasdaq market. S&P futures, the most widely watched futures contract, lost 2.20 points to 1,357 on the Globex trading system. That left futures 3.16 points below fair value, suggesting a lower open for the S&P 500 index. With each S&P futures point seen as equivalent to eight points of Dow Jones industrial average movement, the early loss indicated a 25-point drop for the blue chip measure. On Wednesday, U.S. stocks finished sharply higher after the surprise Federal Reserve interest rate cut.
I like to keep an eye on FRE & FNM...Real Estate will bring this party to an end, IMO. I've never seen them act this way...each down 3-4 bucks on very large volume (it's all relative of course). Some systemic problem raising its ugly head? Any ideas?
Fed adds $2 billion to banking reserves via 28 day RP operation
Banks heave sigh of relief as the rate is a half-percent better than Tuesday's $10.505 billion repurchase agreements, also, the Fed funds market has eased off of the 6-11/16ths level to within 1/16th of the new 6% tarket rate.
Fanny and Freddy bear watching. So do REITs. The slowdown has to be increasing delinquency rates. I pay attention also to housing permits, NOT starts. The actuals, not seasonally adjusted. Since there is about a 90 day delay between loans issued and permits if Mar/April/May are down significantly we are heading for trouble. Home Depot drastically scaling back expansion and laying off 10% of workforce was little noticed yesterday. This was another unprecedented event similar to MSFT's earning warning. I get monthly housing starts and permits if anybody on this site would like to see them.
You may be on to something regarding Freddy and Fanny. Trading action looks suspicious beginning on Tuesday and after nice spikes after the rate cut yesterday, they both continued to fall off to lower levels yesterday and today.
Both had run up quite a bit late last year, so that may be part of what's going on, but also remember the government backing issues from last year.
"...investors speculated European economic growth will outstrip the U.S. even after an interest-rate cut by the Federal Reserve."
"[In today's trade,] At one point it [the euro] staged its second- biggest intraday gain ever, surging 2.59 percent [against the dollar]."
With the yen currency sliding again, please appreciate the wider implications (regarding company decisions under a sliding dollar) found in this next excerpt...
"Traders also pointed to a report in the Nihon Keizai Shimbun, a Japanese business daily, that Toyota Motor Corp. will manage its overseas profits in local currencies, rather than in the yen. The company plans a 3 trillion yen ($26 billion) fund in dollars, euros, yen and other currencies, according to the report, which cited an anonymous Toyota official."
With an eye to the future (regarding rate-cuts and currency strength) as the Fed will save banking system at all costs...
"Interest-rate cuts typically hurt a currency as they reduce the returns on deposits, and the Fed may not be through. Some analysts expect central-bank policy-makers will cut rates again when they meet later this month, further narrowing the rate differential between the U.S. and euro zone."
+
"The fact it was 50 basis points and was before the payrolls number smacks of panic" to investors, said Steve Barrow, a currency strategist at Bear Stearns International in London. "It was a totally ridiculous reaction from the dollar yesterday and it's only right it's paying for it now."
--------------
Central banks ARE mines
--------------
Something of an epiphany recently hit me and, as in most of these sorts of things, I found myself wondering why I hadn't thought of it in this way before.
Like Copernicus realising that the math became so much easier once he put the sun at the centre rather than the earth, it occurred to me that the workings of the gold market became substantially easier to comprehend once I started thinking of central banks as if they were nationalised gold mines.
The United States nationalised gold mine in Fort Knox, for example, has proven reserves of approximately 8000 tonnes, and the cost to mine these tonnes is NEGLIGIBLE. For political purposes, the United States chooses not to mine its nationalised gold. But of course it could do so at a moment's notice.
By contrast, the United Kingdom nationalised gold mine in the Bank of England did choose, again for political purposes, to begin mining its negligible-cost gold in earnest.
How can a 'first-time' gold mine such as Harmony possibly compete? It survives only while a sufficient number of central banks choose not to mine the cost-free gold out of their vaults.
--------------
Perhaps gold is Not eternal?
--------------
Someone recently suggested that perhaps Platinum and Palladium had taken the place of gold as the safe haven for big money in the modern world. That raises two very intriguing concepts: 1) perhaps gold is not eternal, and 2) perhaps platinum/palladium can be a safe haven. While I can envision a day where 1 becomes true, I do have some reservations about 2.
As to the first, we at this forum so often blithely AssUme that gold will forever remain the purest form of natural money, simply because it has always been so regarded. But as the mantra of the stock brokers warns, past performance is no guarantee of future performance. Carl Sagan chose gold as the source material for his recorded messages on space probes because of gold's reputation for remaining eternally in the form in which it was manufactured. However, Coca Cola is nowadays bottled in aluminium for precisely the same reason. The element gold does not have a monopoly on eternity anymore.
We have only to look at our most optimistic literature to see what may lie ahead. The fictional future of Star Trek has, on several occasions, portrayed characters who do not value gemstones or gold. Oh, they're pretty to look at, but with transporter technology they can be manufactured by the ton effectively cost-free. Gold in the Star Trek era has thus had its scarcity value stripped from it. Residents of United Earth, upon observing a London Good Delivery bar lying at the roadside, would pass it by as you would pass by a discarded concrete block. To those readers whom that notion disturbs, perhaps you haven't grasped what Gene Roddenberry was trying to tell you: someday, humans may yet build a society in which citizens are so well satisfied that they have no cause to fear one another... and so have no need to stockpile defences against such threats.
But of course, the world of to-day is far from that idealistic Star Trek future. The humans alive to-day are descendants of creatures who were sufficiently cunning and lucky enough to avoid being killed just long enough to bear children. As a result, we have within us three thousand million years' reinforcement of proven survival habits, one of which is hoarding.
Of course, that urge to hoard can sometimes produce unhelpful results. Obesity is the classic biological example of hoarding: citizens of the civilised world seldom if ever encounter starvation, yet our inherited bodies seem to go out of the way to stock up on lipids 'just in case' famine should ever return (in years past, this was viewed as mainly an American phenomenon, but in recent years the waistlines have begun to spread in other nations as well). Further examples of nonsense hoarding figure prominently in the tabloids: mostly variations along the lines of 'old man's house found to contain uncounted thousands of meticulously cleaned and categorised three-inch lengths of string'.
Sometimes, however, hoarding is beneficial. Travellers on the Null Arbour Plain can seldom be said to be carrying too much spare water and petrol. The Scots managed to rebuke English invasions through the centuries by stashing weaponry everywhere (speaking of which, I'm told the most popular movie in Chechnya these past few years has been Braveheart). And there are countless instances where refugees have negotiated their way past soldiers because they'd planned ahead and had in hand a sufficient stash of gold, silver, jewellery, or some other portable and anonymous form of wealth.
Historically, gold and silver have had top bragging rights as the materials to which the frightened masses would turn in times of trouble. In contrast, platinum and palladium (like aluminium) are comparatively recent arrivals on the stage of man's emotions.
It is true that a lot of big money players are involved in both platinum and palladium, but I should stop short of describing their activities as safe haven investing. In order for something to provide a safe haven, it must be something which is about to be wanted by the masses, but which has yet to soar in price. And palladium has problems with both of those issues.
Practically every adult alive today, whether he owns gold himself or not, realises that gold delivers significant value in a small package. In sharp contrast, however, we few here at this forum probably account for 20% of the adults alive today who 1) recognise the word 'palladium' at all, and 2) know that it has recently soared in price.
As a result, the emotions of the masses have no more hold upon palladium than upon tungsten. There is no practical way in which the masses can hoard palladium, nor I suspect would they care to do so if they could. It's not even a filament of their imaginations.
Look back at any chart of any precious metal's prices. You'll find lots of rolling valleys punctuated by the occasional Matterhorn: from an otherwise calm trading range, the line will abruptly rocket to the heavens, only to plummet back to the valley floor almost as quickly as it arose. If one gradually accumulates while the price is in the valley, he'll have acquired a very safe haven indeed. However, if one begins buying in the stratosphere, he's going to hate himself later. And worse, if he's left being the owner of something which no one wishes to purchase at any price, he finds himself in the same condition as the shareholder of a defunct dot com. Or the hoarder of fiat banknotes from a now-defunct government.
The present day spike in palladium came about due to an incredible lack of foresight among consumers of palladium, primarily the automobile industry. It speaks volumes on human naivete to realise that it was the Japanese especially who allowed themselves to believe that a material 70% supplied by Russia would always be accessible to them.
The present day spike in platinum is being caused by anticipation that automobile manufacturers will retool so as to use the predominantly South African supplied metal in place of palladium. The amusing aspect of this is that, by the time the retooling is complete, the odds are phenomenally good that the South African economy will have collapsed into anarchy.
In both instances, the arrival of a recession in the largest automobile consuming nation (the U.S.) will dramatically lessen the demand for both platinum and palladium. Indeed, the anticipation of same will hammer down their prices in a descent approximately as sheer as their earlier ascent. From now until then we may see their prices double or even triple, but they could just as easily halve this afternoon. I for one have no desire to play catch with a cannonball.
--------------
Global Conspiracy and The New World Order
--------------
I continue to be disturbed by the trend towards conspiracy theories at forums such as ours.
Let us for a moment consider the mother of all conspiracy theories: one world government. The mere mention of that phrase seems to send shivers up some people's backs, but honestly now why should it? I find the best way to appraise a situation is to look back into history for situations which at least somewhat resembled it, then examine what became of those situations.
For example, prior to 1066, England was composed primarily of six earldoms. Heredity did count in leadership positions, of course, but it was by no means guaranteed that the eldest son of the present king would be accepted as his successor. Merit and the respect of the nobles counted considerably, and it was perfectly possible that the six earls might decide to place one of their own number on the throne if they deemed he would be the better man for the job. Of course, the opinion of the commoners was unimportant.
If this sounds vaguely familiar right now, it is perhaps because you just witnessed much the same transfer of power in the United States, where the votes of the earldoms (states) and the nobles (election officials and judges) held sway rather than the votes of the commoners.
Do any of you care how the Secretary General of the United Nations is elected? We've had a President of Earth for nigh on half a century now and most Earthlings haven't even noticed. The high king of England seldom if ever came into a commoner's house, either to benefit him or to endanger him. How many Americans have had Bill Clinton personally invade their homes? For every televised home invasion by federal stormtroopers, there are tens of thousands of interventions by local constabularies.
But that's the key: almost all invading officials are local to the invaded. The bobby banging on your door sleeps not twenty miles from your house, so he'd best bear that in mind when dealing with you. As rare as a federal intervention is, realise how rare a planetary one is. Kosovo needed a planetary intervention. Florida only needed a federal one, and that happened only because the gridlock in that one state was hindering the needs of the other states. I daresay that if a similar fiasco were to occur in one state's governor's race, the federal level would feel no compulsion to intervene.
It is an unfortunate side-effect of human nature that many if not most people allow themselves to fall into overblown we-they mindsets, world views wherein dark forces are massing on the horizon, bent on doing harm specifically to us. The creeping terror which naturally results from such self-fulfilling world views is perhaps the prime motivator behind individual adults' acquisition of physical gold and silver (and individual children's acquisition of stuffed animals).
Being aware of that tendency among the masses, and steeling yourself to avoid falling into the same panic, is the key to knowing when to buy gold, when to hold gold, and when to sell gold.
--------------
Getting ALL the gold
--------------
There's a recurring theme among aficionados of conspiracy theories that 'They' are out to get all the gold away from 'Us' and, once 'They' have it all, 'We' will be at their mercy.
But think that scenario through for a moment. Let's say that NWO, Inc., somehow manages to buy, beg, borrow, or steal every ounce of aboveground gold in the world, down to the very last flake. Let us further say that NWO also takes control of (or at least has the power to destroy) every gold mine on the planet. I gather that's what's anticipated by the conspiracy fans.
In the aftermath of such a complete acquisition, I find myself asking the rather simple question, 'So what?'
Were someone to corner the world's supply of industrially crucial palladium, for example, then yes that would send distortions and convulsions through the world economy. The fact that such a cornering has occurred through post-Soviet ineptitude rather than through brilliant cunning is rather beside the point. The material in question has a very real value because it is a key component in core parts of the world economy... at least, until the major users of palladium have time to retool their systems to instead partake of an alternate material not quite so unreliably supplied. By the time the Russians have their act together, the world will have largely abandoned palladium as an industrial metal.
By contrast, if someone were to stand up to-day and announce, 'I've completely cornered the world's supply of francium and you lot can't have any', I truly doubt there'd be much outcry apart from the odd researcher.
Now let's try that with gold. 'Whilst you lot weren't paying any attention, we at NWO, Inc., have rounded up all the gold in the world and it's ours and you can't have any. Because it's ours.'
Okay, I'll grant there might be a general sense of 'wait a minute' from the world at large. And there would be the more immediately justifiable outcry from electronics makers who had only recently set to wondering why their supplies of electroplate were dwindling. There'd be an even greater outcry from all of the past purchasers of electronic equipment who, now they come to examine the sockets more closely, find that the NWO has successfully infiltrated their homes and offices and scraped all the highly conductive gold electroplate off every contact.
But again, apart from comparatively minor industrial inconveniences, 'So what?'
At this imagined and increasingly ridiculous stage, no-one would still be in possession of even a half sovereign or 5 gram wafer from Credit Suisse, so no-one except NWO, Inc., would have any further stake in any future price of gold. Indeed, by having completely removed the elemental substance from any active market, this nonsensical NWO, Inc., would have caused there to be no such thing as a price of gold, any more than there is a price of francium. Now I ask you: what possible benefit could there be for NWO, Inc., having found themselves the proud owners of a 60-foot cubed block of a substance which they themselves have just rendered valueless?
And that's the nub of it. If you're very very lucky, there may be as many as 4 atoms of francium within a kilometre of your present location, but your complete inability to lay hands upon them has hardly harmed you. Francium plays no biological part in your life, nor does it play any technological part, let alone any monetary part. Gold, come to think of it, plays no biological part in your life, and very little technological part. Nor, for billions of people, does gold play any monetary part.
Indeed, there's already been a far less effective NWO, Inc., rounding up gold for nearly a century now... the various central banks. A third of all the gold ever mined is cloistered in perhaps a dozen government vaults around the world. Additionally, perhaps another third of aboveground gold is cloistered in the vaults of petty governments and of wealthy individuals. And whilst all of that gold has been disappearing from pockets and arriving in vaults, the world economy has experienced the greatest explosion in living standards that humanity has ever experienced.
What makes gold valuable is not its elemental utility. A lump of gold is no more useful than is a still-valid slip of paper with a queen's or president's face on it. What makes gold valuable is that humans have historically regarded it as something other humans will accept in return for food, clothing, petrol, and other things directly necessary for life. What makes paper valuable is that a still-valid government imbues the paper with that same (legal tender) status. The big difference between paper and gold, of course, is that gold minted by a defunct government has the same value as gold minted by a still-extant government, whereas paper printed by a defunct government lost almost all of its value the moment said government fell.
But this notion that, by rounding up All the gold, some conspirators can gain power, is quite honestly wrong-footed. DeBeers, for example, would only be harming itself by attempting to round up all the diamonds not currently owned by them. DeBeers actively wishes for there to be many prominently visible diamonds in the world. The catch is that there should be just few enough of them that there shall always be persons who have no diamonds, and so who are willing to overpay to acquire them.
To maintain that dearth of accessible supply, DeBeers maintains vast holdings of diamonds, many years worth evidently. Just like a central bank's gold hoard. Now why should it be that this vast overhang should be ignored by the market pricing mechanism? Well, for one thing, because DeBeers is the only central bank for diamonds, and it's unlikely to do anything to cause prices to plunge. DeBeers manages the flow of diamonds in the same way that the Aswan Dam Authority manages the flow of the Nile.
By contrast, there are many central banks holding significant quantities of gold, some of whom wouldn't mind seeing a rise in POG, whilst others wouldn't mind seeing a fall in POG. Imagine competing dams, some of whom wouldn't mind seeing the lowlands become a desert, while others wouldn't mind seeing the lowlands become a lake. The result is that no single cabal exists which can control gold in the way in which DeBeers controls diamonds. Despite fears to the contrary, the price of gold is set in a far freer fashion than are many luxury goods.
More importantly, each of these competing central banks hold sufficient amounts of other wealth so that their gold component is, to the bankers themselves, not significantly large. That's why the Bank of England can sell its gold at a 20 year low and can afford to look stupid for having done so. It harms them no more than it harms you to occasionally pay Federal Express charges to post a letter. Is it foolish to pay �26 when it absolutely, positively has to get there overnight? Of course not. It's only foolish if you pay �26 for no good reason.
Likewise, the Bank of England is incurring only a very minor loss on its gold sales, yet is obviously doing so in pursuit of some greater gain elsewhere. There has been a concerted attempt since 1999 to stop sterling from tracking with the U.S. dollar, instead trying to steer it towards favourable alignment with the euro, primarily to stave off capital flight from the UK into Ireland and the rest of Euroland. As often happens with such interventions, the effect is only just now beginning to kick in, too late to retain several important manufacturers such as Sony. Hmmm, now there's a new catch phrase... 'Sony capitalism'.
To Hill Billy Mitchell regarding (12/31/00; 13:49:07MT - usagold.com msg#: 44762 through 44771), I say EXCELLENT! You've taken me gloriously at my word when I suggested a month or so ago that we should all thoroughly challenge suppositions until their truth or falsehood was made plain. I was afraid for a time that no one was going to challenge my own suppositions, and I thank you for it.
I especially like your passage, '...to some, gold is physical. To some, gold is political. To some, gold is philosophical. To some, gold is safety. To some, gold is religious. To some, Gold is God. To most gold is a mixture of several of these.' Frankly, I think that statement would be an ideal motto at the entrance to this roundtable.
With barely two lines of text, you have wonderfully captured the point I was attempting to make in (12/01/00; 10:17:12MT - usagold.com msg#: 42604): if one would wish to know whether to buy, sell, or hold gold at any particular time, the first thing one should do is find out how his fellow market participants feel about gold at that time.
The second thing one should do, and by far the more difficult, is to then act contrary to the masses. When everyone wants to own something, that's the time to sell it to them. When everyone wants to sell something, that's the time to buy it from them. In order to successfully do this, however, one must realise that most market participants think like sheep, and one must consciously lift oneself out of the sheep mindset.
Please do accept that I mean no harm by describing my world view here. Quite the reverse: it is only by becoming aware of other people's world views that we improve our own chances of living happily to a ripe old age. As Peter Asher rightly pointed out in (12/31/00; 21:46:12MT - usagold.com msg#: 44797), 'the western bible viewpoint is a rather small percentage' of humanity. And for that matter, the mainly-U.S. fundamentalist viewpoint is an even smaller percentage of Christendom. As a result, although your own world view gives you a pretty clear idea of how U.S. fundamentalists currently regard gold, it will not help you to successfully anticipate how the other 95%+ of the gold market's participants will arrive at their buy/hold/sell decisions, simply because they are reading from different playbooks.
Note that I approach religious issues in the same way I approach political and investment ones: they are all things which, rather much by definition, cannot be perfectly known. That's why I see no incongruity in occasionally touching on religious issues at this gold-centric forum. It doesn't help us much to debate the precise number of angels which might or might not fit on the head of a pin, but every person who buys, holds, or sells gold does so for reasons which include his or her opinion as to whether angels exist in heaven or only on 20 franc coins. By observing how others around us arrive at the conclusions they draw, we can use those other conclusions to refine our own. This makes it more likely we'll survive and thrive as the world shifts and churns around us.
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How clean can I make that slate?
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You and I both genuinely attempt to start our contemplations with clean slates. But here we diverge: whilst you expect that you can perfectly clean your slate, I do not expect that either of us can ever completely clean either slate. No matter how hard we scrub, there will always be a few molecules of chalk clinging tenaciously to the surface. So, sitting here as I am with a slate which I feel I cannot perfectly clean, how can I have any hope of drawing reasonable conclusions?
Hope lies in realising that it's not necessary to achieve perfection. As most leaders of men will readily affirm, it's almost always unwise to try to acquire 100% information before making a decision. The final 5% will take longer to acquire than the first 95% did. But more often than not, being 95% certain of something is sufficient. Those who wait in hopes of 100% generally have their lunches eaten by their competitors.
For example, no president of a gold mining concern knows precisely how many ounces of gold are under his feet. But he does have a rough notion, and that's usually sufficient for him to keep things rolling. He simply doesn't care to know to the seventh significant digit how much might be down there. It's not only not possible to know, it isn't necessary to know.
Conversely, the recent political debacle in the U.S. state of Florida shows what goes wrong when people expect math to perfectly model an imperfect world. It is now literally impossible to accurately count every vote in that election, because voting forms and equipment which were sufficiently accurate to call a 60/40 election were simply not up to the task of calling a 50.0000001/49.9999999 election. Before nightfall on the day of the election, the system had already irrecoverably failed to capture the information it needed to ascertain the intention of every voter. Everything after that moment was tilting at windmills.
Nurses seldom take a patient's blood pressure more than once per visit for precisely the same reason: they could take it a hundred times and it would be different every single time. One might as well accept the first measure, because it is no less valid than would be a second or fifth or fiftieth 'recount'.
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Close enough for government work
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For me, there are no absolute truths. Not even in mathematics: two plus two sometimes rounds up to five for large values of two. But there are lots of 'close enough' truths, and most of the time they are quite sufficient. Religion provides perhaps the most contentious demonstration of this problem, particularly in regards to the notion of infallibility. When I describe myself as an apathist, what I'm trying to convey is that it does not disturb me to think that the particular edition of the Bible sitting on my bookshelf might be riddled with errors. Indeed, it reassures me.
While I'm quite confident that you, HBM, rarely if ever fall into this trap, I do observe that many people who believe without question every printed word in one book have a hard time questioning the printed word in other locations. Take the ubiquitous tabloid headlines declaring that the Bermuda Triangle is somehow supernatural. There it is in print, after all. And I'll admit to having had in my youth a deep hope that the myths of the Triangle might turn out to be true. But as an adult I learned an interesting thing: the run from Bermuda to the Bahamas is one of the most popular among amateur boaters... combine too much money, not enough common sense, and large amounts of alcohol, and it's suddenly not so very surprising that lots of boats disappear there. Nowadays I regard the Triangle as nature's way of weeding out rich idiots.
Each of us either fosters a habit of questioning everything we observe, or of accepting everything without question. And therein lies all the difference between people to whom history happens, and people who cause history to happen.
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Always demand a second opinion
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The point on which I'm sad to say I expect we shall never see eye to eye is that I do not regard any single text as a reliable document, religious or otherwise. The human authors of any text, and the innumerable human editors and translators who subsequently lay hands upon that text, each have their own world views and resulting temptations to omit and/or rephrase that which they do not like. I cannot in any way accept, for example, that the long-forgotten monk who translated the parable of the talents into Jacobean English was any more objective than is, say, the copy writer for the Gold Council.
When Dr. Greenspan speaks, is he saying what he honestly believes, or merely saying things which will cause the reactions he desires? And, as Black Blade points out almost daily, journalists who crank out economic reports are highly likely to either 1) have a personal bias even if a subconscious one or 2) lack expertise but face a deadline and so type what sounds good.
As a general rule, one rendition of a purportedly historical event should never be accepted as accurate until a second independently recorded report can corroborate it. And if the two reports disagree? Seek for a third. Even though the printer has carefully applied the letters HOLY BIBLE to the front cover in gold leaf, I still want to read an Egyptian account of Exodus before I'll be willing to accept that the story is historically factual. That the story is religiously inspirational I do not question, but that's an issue independent of determining what really happened.
So yes, whilst I would regard the original lightning-graven tablets of the Ten Commandments as infallible were they still available to-day, you are quite accurate when you suggest that I cannot regard any subsequent reprint as infallible. Not even the 'original Hebrew and Greek manuscripts', you might ask? Well, so far as I am aware, Joshua ben Joseph spoke Aramaic, so every one of the Greek phrased quotes ascribed to him was already at least once translated, and that left the door wide open for errors of interpretation. And if he had learned Greek in school? Well, recall that U.S. president Kennedy stood in downtown Berlin and sincerely attempted to show solidarity with the assembled crowd by declaring 'Ich bin EIN Berliner'. Unfortunately for him, this was received by the audience as 'I am a donut'.
HBM, I hesitate to 'directly' quote Machiavelli for precisely the same reason. I do not speak modern Italian, much less 1500s Italian. I have read three English translations of The Prince, and to my complete lack of surprise I find that the resulting English phrases used vary a great deal within the same passage. But I look for the general sense of it, rather than try to tease out precisely what Nicolo might, or might not, have been subtly trying to imply. Indeed, it is the man's lack of subtlety, his preference for candour, which recommends the work to me. But even so, when he makes casual reference to minor events instantly familiar to his own generation, the references are lost on a modern audience without translator intervention. And that presumes that the translator himself understood the reference, an often unwise presumption.
One of my favourite modern examples of translation problems was the catastrophic failure of an American refrigerator company to advertise in Thailand. They hired a local fellow to render their slogan, 'Out of sight, out of mind', into Siamese. Not grasping that this was an idiom, the chap took it literally. On about ten thousand billboards all over Thailand were displayed smart photographs of these attractive little refrigerators with the slogan 'Invisible things are insane' emblazoned over them. Whilst I daresay the translators of religious documents are more careful, by being human they simply cannot be perfectly careful. Thus, the results of their endeavours cannot be infallible.
Interesting thought: the U.S. is roughly comparable in size to Europe, but the majority of Americans know only one language. Where we over here have daily reminders of the fallibility of language translation, many of you live long lives without such reminders. That may go quite a ways in explaining why Biblical infallibility is mainly an American notion.
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Safety is where you find it
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Throughout time, there have been a minority of humans who were of a mind to 'step out of the box' and look back at the world from afar. You've met people of my mindset before, though most of us have had the sense not to admit it to you. I am much more candid at this forum than I am with those who know my real name, because honesty without anonymity often invites peril. Because we are willing to see the big picture, the vast majority of us are able to avoid the limelight and present the appearance of leading the most boring, uninteresting lives. Which explains why the Chinese consider it a curse to wish for someone to live in interesting times.
Most of us use our world view for survival, not self-aggrandisement. And if that world view can assist others in seeing an approaching fist, so much the better. It's by no means necessary that others abandon their own cherished world view: by simply becoming aware that your world view is not the only one, you dramatically improve your chances. But there are things to recommend our world view, obviously, else we wouldn't live long enough to talk about it.
We're the ones who shook our heads when we saw footage of people scrambling for the last helicopter to leave Saigon. We'd already long since left the place, just as Einstein had long since left Nazi Germany before the trap sprang shut on those less observant. The phrase 'How did they not see that coming?' is, sadly, a frequent visitor in our thoughts.
But not all of us are seekers of quiet. Many of the names you find in history books, for both good and ill, number among those who position ourselves outside looking in. There's a line from the movie, The Hunt for Red October, where the head of the U.S. Security Council says to the CIA researcher, 'I'm a politician, which means that while I'm kissing babies I'm trying to figure out how to steal their candy. But it also means I keep my options open.' A small few of us keep our options open with intentions of becoming infamous, but most of us do it with intentions of staying out of harm's way.
You, HBM, place great confidence in the faith in which you were raised, and you likewise place confidence in gold over other investments. By contrast, I have no such confidence in any one thing. As the last two decades have demonstrated, gold is not always a safe haven. However, with each grindingly lower year, gold becomes more and more a safe haven. But how much lower can it go? Quite a bit. Will it? There's no way to know.
I suppose that's the crux of it right there: I do not believe in eternal safe havens of any sort. Nothing is forever safe because everything is always in motion.
The devoted faith of English Catholics served them quite well right up until 1535 when Henry VIII decided he wanted a divorce. Within the year, many who continued to look to their religion for safety found instead that it had become their doom. Four hundred years later, hardworking and patriotic German citizens who worshipped in synagogues discovered to their horror that their faith had marked them for death. Heaven only knows how many prayers from concentration camp victims went unanswered. Just a couple of years ago, peaceful citizens of the former Yugoslavia were assaulted and driven from their homes because they were Muslim (well, more generally, because they were not Serbian).
Those of you who saw the movie Braveheart witnessed a great example of the divide between HBM's world view and my own. I daresay HBM finds a lot to admire in William Wallace's willingness to stand unflinching against the enemy. For myself, whilst I do greatly admire the man's courage, I cannot help but bow to the sense of Robert Bruce's decrepit yet wise father who knew when to get out of the way of the hammer. No, I didn't like it, any more than the young Robert Bruce liked it, and I would have tried to handle it in some other way had I been that decisionmaker, but the father's act did preserve the Bruce family and give it the chance to fight again another day.
To quote another Mel Gibson movie, Chicken Run, when Ginger says 'We'll either die free chickens, or die trying', recall that one of her fellow captives then wonders, 'Are there any other options?' Whilst I myself found Mac to be my closest kindred spirit in that movie, I couldn't argue with the ever-knitting chicken's sensibilities on that question. Actually, come to think on it, there was another line she said that was very much in keeping with my mindset: 'My life flashed in front of my eyes ... it was really boring.'
People who live long enough to pass in old age into the hands of their chosen maker are almost always those who knew not to raise their hands during a hijacking and ask for the kosher meal. Most such observant people had also secreted their savings in places untouched by time or by tyrants. Sometimes those safe places included gold. Sometimes not.
As it happens, I tend to think that the present day is a reasonably safe time to gradually acquire gold, regardless of one's personal motivations. We've been descending into the valley of POG for years now, so the odds of gold's present price being unsupportably high are quite a bit less than they were in years past. But because there's no way to know for certain, I own a little of many different things, and I really don't care which one if any suddenly leaps for heaven.
Yours,
I.V. Holtzman
PS: To USAGOLD regarding (12/31/00; 21:12:58MT - usagold.com msg#: 44796), I got a great laugh from your wife's interpretation that 'he was obviously a twelve year old child trying to stay out of trouble with his mother.'
PPS: To Pandagold, who wrote in (12/3/2000; 6:54:02MT - usagold.com msg#: 42780), 'It has now become a well known clich� in Britain that Hollywood gives the "baddies" British accents.'
Well, I suppose it's to be expected. For half a century 'til just recently, Hollywood's standard way of identifying baddies was to give them either German or Russian accents. But as American movie-goers began to have difficulty pointing out Germany and Russia on a world map, Hollywood realised it had to find other ways of putting a 'not one of us' label on the baddies. You can even see where the transition occurred: the lead baddie in Die Hard was a German terrorist, so naturally they cast London-born Alan Rickman (who couldn't utter a proper German R even if he leaned his head back).
Weird casting decisions do seem to be pretty equal-opportunity, however. Scottish actor Sean Connery was cast as a Lithuanian submarine captain. Mexican actor Ricardo Montalban was cast as Sikh warrior Khan Noonian Singh, whilst Yorkshire-born Ben Kingsley was cast as Ghandi. That they each managed to pull it off brilliantly is rather more a testament to their acting skills than to the casting skills of their employers. I'm just waiting for someone to cast Priyanka Chopra as Hillary Clinton. And don't even get me started about Robin Hood.
Sometimes, though, they get it right. One of my favourite movies is the 1981 film Arthur. Most people remember it simply as a comedy about a chap laughing whilst being drunk, but it's really a story of the depths to which loneliness can drive one. The casting of Dudley Moore as a New York financier's son was panned by several film critics who argued that the son's accent ought to have been like the father's. But watch that film again and ask yourself something. Decades before the events portrayed in the film, who do you think took the time to teach the child how to speak? Arthur's biological father? No, too busy at work. Who else would have cared enough but Hobson the butler (played by John Gielgud)? Those casting decisions were spot on.
Hoopie, those monthly housing starts and permits along with your observations/opinions would be very informative, TIA. Delinquency rates are starting to rise. Can you immagine what would happen if unemployment shoots up? I have a feeling that many home owners would become tenants. The RE market is so levered up that a super crash is all but certain. When? If you know, don't keep it a secret.
Lamprey, "but also remember the government backing(sp?) issues from last year." Did you mean 'banking'? I need some help here...can you spare a brief refresher course? TIA
Possibly the best post ever to appear here, this is IMO the most comprehensive covering of the two most prolific subjects on the Forum, Gold and Religion.
Newcomers to the Forum would be well served by being directed to this missive before engaging in discussion and debate.
Holtzman: One little detail. --- How about changing "German citizens who worshiped in synagogues discovered to their horror that their *faith* had marked them for death."--- to the actual reality that their *blood-line, no matter how diluted* had marked them for death.
Also. could you explain the German "doughnut" translation?
I clicked on the link you provided, and as promised, I found both sides of the issue were well represented. It was easy for me to side with ORO on this issue. Thank you for addressing several of the questions I asked FOA.
I'm not averse to change, and yes, that "uncheatable" wealth reserve concept you mention would suit me fine.
A Second to Peter Ashers Nomination for Holtzmans #45018 & # 45019 into USAGOLD HOF!
After reading these 2 posts my thoughts were stuck on the lyrics from a long forgotten popular song:
"Hands Across the Water, Hands Across the Sea!"
(I'm in the U.S.)
"It all depends entirely upon whether the remainder of the investment world believes the US dollar is worth the artifically inflated valuations of the underlying assets;specifically share assets.Furthermore,in order to make them believers, the asset valuations must be driven higher in a fashion that is nothing short of spectacular and supported.Which means a continuance of US monetary expansion and therefore, another probable strike at the heart of gold.
Rally & 48 hrs.....Yesterday I said 48 hrs, hell it didn't last 24. Selling the Rally is still going on and after yesterdays gains are wiped out the selling will be given another name and new reasons by the (again) gloomy faced talking heads.......
Reality bites harder than a angry Rottwieller....YGM.
GOVERNMENTS across Europe are quietly preparing to trap money-launderers and tax evaders when a mountain of cash emerges for exchange into euros on the launch of the new currency next January.
France, which has a long tradition of cash-hoarding by bank-shy citizens and tax-averse tradesmen, is leading the way with plans to monitor the origin of big sums when people turn up with suitcases of francs in the six-month changeover period. As much as �15 billion, half of all notes in circulation, are believed to be stuffed under French mattresses, in drawers or in private safes, according to banks.
Financial institutions and the tax authorities are hoping to reap a windfall from the currency changeover. Tax authorities and banks in all 12 euro states are bracing for the emergence of billions of pounds in hidden cash when citizens are forced to convert notes before they become worthless. If handled right, the exercise will provide a windfall opportunity for banks to collar savings and divert them into investment and also for the taxman to nail "dirty" money.
However there are fears that the confusion of the mass changeover will be used by criminals to launder illicit cash holdings. The impact could be spectacular in Italy, where a fifth of the economy is officially estimated to run on cash, much of it beyond the reach of banks and the taxman. The country's antiquated banking system will make it hard for the authorities to keep tabs on people turning up with suitcases of lire, Italian officials say. In Germany, which has a smaller black economy and a tightly regulated banking system, officials still fear that criminals could use the confusion of the changeover to launder cash.
"It is going to be boom-time for drug dealers and criminals trying to shed their holdings," a Berlin official said. Belgium, which also operates heavily on cash, is taking steps to check the origin of big sums.
France, with its old tradition of cash-hoarding, is taking the toughest measures to monitor the expected flood of big-denomination franc notes, which cease to be legal tender on February 17 next year. Thrifty French countryfolk and cash-only tradesmen were told yesterday to expect attention from the taxman. Keeping a nest egg in a bas de laine, or woollen stocking, is still popular among older French, especially in rural areas. Up to 80 per cent of all Fr500 (�50) notes are said by the Banque de France to be out of circulation. With French taxes among the highest in Europe, a substantial share of the banknote mountain is assumed to be held by artisans and small businessmen who operate au noir � on the black � to stay free of the taxman and the VAT man.
The franc-euro exchange will be free, but the catch for illicit cash-holders is that all but relatively small sums must transit through an account, even if withdrawn immediately in euro notes. The ceiling on non-account conversions has not yet been fixed.
Consumer groups are fighting the rule on transit through accounts, saying it is unfair. The banks are chafing under sweeping laws that require them to notify authorities of all "suspicious" transactions.
The campaign to acquaint France with the future currency took off this week. Citizens are being advised to get used to buying a baguette for 61 cents rather than four francs.
Polls show the public and small businesses to be resisting the idea of scrapping the franc, but the Government is banking on the revival of the euro against the dollar to help to convince a reluctant country that the changeover will be worth the effort.
Will pass housing numbers on, next release Jan 18 for December's starts/permits. That should be a pretty brutal one. Just to give a few more clues my friend who is president of a large regional midwest bank said they are tripling their bad debt reserve, adopting a repo on vehicle after 2nd late payment policy, and opening a "car lot" on the bank parking lot. He has 3 - 6 month old vehicles already repo'd or turned back in on lease. He had a $31,000 Yukon 4 months old that didn't bring the $21,000 minimum bid. As far as building materials go many are priced lower than in 1991 during Iraq war. OSB board has dropped 20% in 4 business days. Surprising to me is nothing went up today after Easy Al's juicing and in fact lumber futures approached limit down today, settling down $7.40 m/bf. One of the largest insul sheathing board manufacturers told me they would do anything to keep product flowing because their cash flow was acute to survival. Another barometer to watch is Home Depot stock. If it begins floundering it is practically the default setting for voting for this industry. I would view a break of $40 as ominous. Since it is a mutual fund darling an exodus would probably be cronies getting tipped off. Will post as can,but time often limited.
Swiss Natl Bank gold holdings fall
A corrected version follows:
(Adds details on gold, SNB 2000 earnings, background)
ZURICH, Jan 4 (Reuters) - The Swiss National Bank said on Thursday the total amount of gold held on its books as reserves by the end of 2000 fell by 2.276 billion Swiss francs ($1.42 billion) to 34.725 billion francs.
An SNB spokesman said the drop from December 20 to December 29 largely reflected a decline due to the SNB's regular quarterly assessment of the value of its gold.
The book value was revised down to 14,335 francs per kilo at the end of December from 15,245.65 francs at the end of September, the SNB said in a statement.
The SNB began gradually selling some of its gold holdings last May and ultimately plans to sell 1,300 tonnes, roughly half of a total 2,590 tonnes.
The SNB said at its year-end news conference in December that it had sold 160 tonnes of gold since it began the sales and plans to sell the same amount again through end-September 2001.
It is one of 15 European central banks which agreed in 1999 to sell a total of 2,000 tonnes of gold over a five year period, with annual sales not to top 400 tonnes.
In a separate statement on Thursday the SNB also said it had produced a surplus for 2000 of 28.1 billion francs.
Excluding gold, 2000 earnings totalled 2.7 billion francs of which 1.5 billion francs will go to the federal government and cantons as mandated by law.
The vast remainder resulted from a legal change effective May 1 which allowed the SNB to value its gold at market prices, well above the old book value of only 4,595.74 francs per kilo.
The revaluation led to an extraordinary book gain of 25.4 billion francs in 2000, a small portion of which will go into a special provision for market and liquidity risks, the SNB said.
The remainder, totalling 18.9 billion, will be set aside.
Switzerland has yet to decide how to use the windfall from revaluation of the gold. The Swiss government, in the wake of criticism of the country's role in World War Two, proposed placing the proceeds from sales of 500 tonnes of gold into a charitable Solidarity Foundation.
Swiss right-wing politician Christoph Blocher has opposed the plan, favouring instead using the gold proceeds to shore up the country's old age pension scheme.
Home Depot reported to be closing several stores @Hoople
"Another barometer to watch
is Home Depot stock. If it begins floundering it is practically the default setting for voting for this
industry. I would view a break of $40 as ominous. Since it is a mutual fund darling an exodus would
probably be cronies getting tipped off.
Reported on CNBC today." -Hoople
According to CNBC (didn't take specific note) Home Depot will be closing several of its stores this year.
Home Depot reported to be closing several stores @Hoople
OOPS! THIS version is correct, the one directly below is misleading. Hoople wasn't reporting on any CNBC info as far as I know. SO completely disregard the other version of this message!!
"Another barometer to watch
is Home Depot stock. If it begins floundering it is practically the default setting for voting for this
industry. I would view a break of $40 as ominous. Since it is a mutual fund darling an exodus would
probably be cronies getting tipped off." -Hoople
According to CNBC (didn't take specific note) Home Depot will be closing several of its stores this year.
Hello all
I have been lurking for several months. This is my first post.
Old Yeller asked if there would be aonother strike at the heart of gold in connection with the Fed. rate cut.
Could it be that there was a massive (PREEMPTIVE) strike on gold two days before the cut.
Any thoughts from anyone on this.
Dagnabbit! Now I'm not gonna get any work done today with this writer's words a-simmerin' in my head. So I might as well get this out.
To start, IMO, any post that can hang its philosophical threadwork on "Chicken Run" (and the exegetic study of Mel Gibson's works) deserves the HOF Oscar.
This year, I've spent time in Europe (Italy), the US East Coast (where I used to live), and (where I live) the West Coast. I've noticed the differing bands of attitudes before, but, for brevity's sake, I'll say that this year I've discovered the label for it: Romantic Zones.
Bad label, I know. But it is the differing levels in romantic outlook on life which strike me as we move from west to east and back again.
(I am torn. To continue writing this today is a romantic outcropping of belief and enjoying the power of expression of words and shared joy of communication. To stop, and get my client calls and billing done is pragmatic, survival-oriented, and self-needs-centered. As usual, I'll try to slice it both ways.)
The frontier spirit was the myth that most captured the American imagination, and those who are able to speak it unabashedly and who appear to be living it (John Wayne, Ronald Reagan) become the unquestionable icons of American life. Occasionally, the frontier myth captures Europeans as well and they send us lots of money. Thank you. Merci. Grazie. Danke.
(Side thought from an ill-educated goy: Israel and Zionism seem to have a great frontier romantic component behind them, as well as their stake in pragmatic survival.)
Religion is at the furthest extreme of the romantic imagination and it commands a certain baseline respect within American life, no matter the actual practices of the adherents.
With regard to Christianity, I have known people to become believers in order to recover from alcoholism, to save troubled marriages, to recover from childhood abuse. Personal "salvation." (Note: This does not necessarily invalidate the religion itself, just makes the believer a less-relevant proselytizer to me.)
I have also known people whose beliefs originated more "rationally", from the Social Gospel of Jesus' teachings. "Wouldn't it be a better world if everybody..." (These don't proselytize at all.) Many attend churches primarily for the social companionship. Yet Dr. King and others have shown the prophetic, even mystic, potential of religion based on nonviolence and justice.
In my own romantic youth, I "stormed the gates of Heaven" out of some other metaphysical need, probably the desire to know what was real and if this world we see around us is all there is. The wish, at age 20, not to wander in a wilderness missing a fuller life I could have had by a little more curiosity.
I had (a few) experiences that told me that the foundation of the religious quest is probably real, that Jesus (and others) were most likely really there as the less-translated accounts say, but that the useful discovery of them must be made in each individual's life, and that that would take a lifetime of, yes, wandering in the wilderness. (A hard and incomprehensible "Answer" to receive at age 21.) But, like Holtzman, I'm not sure even of this, and none of it to the point I would impose on another. I can live with that, and do.
I found no group, book, or single philosophy that could give me the Easy Way Out. Only temporary oases or rest stops (some with very nice, clean bathrooms.)
Fundamentalism and evangelicism share that sense of romanticism (and have a very large market share). They don't present themselves to me very well as philosophies, even based on what we know of Jesus and his teachings. They are very much, as Holtzman points out, American phenomena.
Yet I can't dismiss them, because I know that INDIVIDUALS are having the learning experiences they seek and are capable of, and they WILL come to their own conclusions, as only they can. Yes, I want to know what inspires them. And if they only find shelter for awhile from chaotic times around them, I don't begrudge them that. I've been there, and the need still flares up once in awhile.
NWO and other conspiracy theories are a sort of anti-romantic romanticism. Study that Devil! They can be V-E-R-R-R-Y exciting! But then, so was National Socialism, as Leni Riefenstahl showed us. Sorry, that was clipping my topics together a little too closely. (I am somewhat interested in them, but wary.) Oy vey!
I guess the issue I have been pondering this year is "how to learn to somewhat distrust the things which excite me." Kind of like contradicting the human being's Prime Directive,eh? I guess I'll always be an "Excitable Boy"?
Holtzman writes about the pragmatic, survival-oriented diversification of viewpoints and experiences, relying none-too-heavily on any. I understand this. This is what happens to us in life anyway, after the excitement is over. I think of Yevtushenko's "let me be forever tossed between the City of Yes and the City of No." Hardly willingly.
(I will jump, of necessity now, to a possibly not very satisfying or well-established conclusion here.)
Jesus was nothing if not a Teacher. Wherever students gather, a good Teacher should be welcomed and recognized. His teaching words -- HOWEVER WE GOT THEM -- contain live nuggets of wisdom that penetrate our thick brains and with merit have lived for generations. Common people recognize common sense in them. Here I refer as an example to the "Pearl of Great Price" parable.
If your market research, life experience, and peering-round-the-markets'-corner wisdom tells you that gold is undervalued like no other asset. Then you get a credible guy like Trail Guide telling you that gold will "out-run everything on the planet so as to get to that inflation price starting gate!", you have a likely once in a lifetime "Pearl".
You are already diversified -- in your career, your life in these Dollar States of America, your house and family. Why not 100% pick for your liquid assets the investment that holds the best risk/reward ratio -- in YOUR judgment -- and thus will "outperform" any other? Or is this just my Romantic side looking for a good story to live in for awhile? Have I been "seduced" by the good company "watching together" at this Round Table?
And lest anyone confuse the level at which I just segue'd this post, I am mindful as we all should be that he taught: "for where a man's heart is, there will his treasure be also." I doubt that any of us will find, upon searching, that our hearts reside in gold. It is but a tool, and we come together to better learn how to use it, although that day may be off in the future.
There! Three hours well-spent. Yikes! Back to work!
P.S. Ben Kingsley, though Yorkshire-born, was born Krishna Bhanji, with his father an Indian doctor from Kenya. I remember hearing that by some coincidence his Indian family line goes back to the same village Gandhi was from, but I couldn't find any confirmation of that today even after some searching.
is a word you don't hear much anymore. Usually because "them's fightin' words." One man's faith is another man's supersitition.
We (the West) used it last on the Third World's "primitive" (that word went away, too) religions, then found they weren't so "dark" or that we had just better be more polite until we knew what we were talking about. Once conquered, I guess maybe it didn't matter what we called them.
I would venture that superstition exists today, in spite of the disappearance of the word from daily use. (And just like the fish, who has no word for "water", or any other words for that matter ;), perhaps it is because we are "swimming" in superstition, as humans have done from the beginning.)
Maybe it's because, once you have a people totally befuddled, you don't let a little light in by using the word "Superstition", lest you provoke some penetrating thought. You use good buzz words like "enlightened", "liberal", "free market", "conservative".
Perhaps superstition arises from a near approach to the truth, or, to paraphrase Holtzman and others: "close enough for clerical (as in clergy) work". You have encountered, by accident or pursuit, some truth but are momentarily blinded by it. How long that moment may be remains the question. To continue the diligent pursuit, or rest with the attained truth? (Risking your grip on the earthly flock you've gathered.)
Religious revivals have occurred not only as a reaction to the encroachments of science on everyday life, but secondarily out of a discovery of Western humanity's superstitious faith in science. That's right, science can become superstition, when its seekers rest on partial truths and ingrown biases. Spiritual seeking then re-asserts itself, as an integrator of science and faith (not-"knowing"), and sometimes through religion (as human groups; "religio": "binding together") as a fearful backlash.
I will say: I think there is at birth an "empty" part of the human brain that CRAVES to be filled up with religion (and similar belief) of some sort, in either/both a healthy way, and/or a manipulable way. In those distinctions is all the excitement we find in the topic.
I hear Stevie Wonder warming up: "When you believe in things that you don't understand, then you suffer. Supestition ain't the way."
Economics has paraded itself as science (better funding) through most of the 20th century and humans have been able to churn out much superstition from it. We write about and attempt to puncture those superstitions daily here.
Superstition is visible today in the stock markets: "Buy and Hold" and "stocks always come back (but to wait 25 years?), "stocks earn 9% long-term" (but won't during the remainder of YOUR lifetime).
Superstition is what we are accused of in seeking gold. In fact, if you probed the average American's thoughts, gold would be associated with some medieval time of leeching (I think of Steve Martin's Barber of York skit here), and witch-burning, rather than with the 20th century U.S. currency up through 1933, or 8000 tons still held by USG.
"Barbaric", quaint, comical, obsolete. (Until it's not.) Very unscientific and UN-HIP. Who can fight against that much bad PR and deprecating attitude? You can recall more examples of this yourself, I'll bet. When you realize you are in those crosshairs, summarized as "Nyahh, nyahh, superstitious!", you see how truly difficult it has been for us to offer up a different view of "truth", no matter how many facts in support.
Oh well, enough "coffee talk". (Honest, officer, it was just the coffee talking...) Link above not related, just a hoot...
Haven't heard of any Home Depots closing but the evening news reported a number of Sears stores are being shut down with a large lose of jobs. I was half listening so I can't give accurate numbers but in Massachusetts where we live, many Sears stores are the big "anchor" stores of the malls they occupy.
This and other bad news may IMHO quickly overturn the Fed's rate cut "happy days are here again" move.
I remember when Warren Buffet accumulated 89 million ounces of silver during the summer and fall of 1997 before his broker was forced (by the filing of a lawsuit) to disclose that it was Buffet buying. Mr. Buffet then stated that he had 89 and intended to take final delivery of 129 million ounces, which he did. He shipped them to London and the suit was dropped. He said he was buying to "restore equilibrium in the silver market". If he could buy 89 million ounces (over many months) once, just 3 years ago, it would seem that very large accumulation is possible before any price reaction in silver at least. It would seem that if things get bad enough, safe haven in metals will be sought (even if only temporarily). We probably won't know it has happen until well after the fact.
The closing of a number of Sears stores will be looked at, in hindsight, as one of the warnings of something terribly wrong with the economy.
I make my living in the construction business. Oh well, nobody said it was supposed to be easy!
Rich
WARNING - Trekkie talk, please skip if easily bored...
I hate to belabour the intricacies of the workings of highly theoretical technological devices, especially on a gold thread, but as a low-level Trekkie I will, as this has some (theoretical) bearing on the "future value" of "future gold".
Both the transporter and replicator supposedly work by disassembling and reassembling the molecular and/or atomic structure of a source object. Neither operates at the sub-atomic level. In other words, the transporter does not break an object into protons, neutrons, and electrons, apparently because of the tremendous amounts of energy that would be required and because it is not necessary to break an object down into the sub-atomic in order to transport it, if such a device were even possible.
Sister-technology replicators do not create objects out of thin air. For a replicator to actually "create" gold would require an immense inventory of protons, neutrons, and electrons, themselves not easily or cheaply collected and contained, and these would need to be assembled into the elemental molecular pattern of non-radioactive gold, requiring tremendous amounts of force in the process.
Instead, the replicator supposedly actually acts on a store of elemental materials, such as hydrogen, oxygen, nitrogen, carbon, etc., and uses these to replicate another object by referring to a pre-stored pattern, such as alcohol, and then produces a simulation of the real thing by mimicking its molecular structure using the stored elemental or molecular building blocks. Great for making "food", complex molecules comprised of simple common, elements, and lousy for making pure gold, a single, rare element.
The transporter cannot make gold, it can only transport existing gold. The replicator cannot create gold, it can only shape existing gold into other compounds or artifacts.
No level of technology can reverse or remove the laws of physics. Not in this dimension anyway. The people on Star Trek can't "make" gold any more easily than Alan Greenspan. Why do you think the Ferengi hoard gold-pressed lanthanum?
Now future mining technology is a whole other issue.
NEW YORK (Reuters) -
On Thursday, after the close of regular trading, the Fed cut the discount rate again -- by another quarter percentage point -- to 5.5 percent.
The seawater of the Earth contains many thousand tons of gold. Wouldn't I just need to feed seawater into the inventory of a replicator to get 999.9 gold bars out of it?
Calif. Regulators OK Interim Electricity Rate Hikes
There is no mention of natural gas in the article referenced. Apparently these people cannot understand that when a state fixes prices, that market is not deregulated... that market is very highly regulated. Socialism lives on in California.
SAN FRANCISCO (Reuters) - California energy regulators, grappling with a financial crisis that threatens to bankrupt the state's two biggest public utilities within weeks, on Thursday approved temporary electricity rate increases of up to 15 percent and warned that the crisis was far from over.
-snip-
"EPITAPH" FOR DEREGULATION
Carl Wood, a CPUC commissioner, said the commission's action spelled an end to the state's chaotic deregulation effort. "What we are voting on today is the epitaph for deregulation in California ... deregulation is dead. It is time to put this behind us and clean up the mess it has left behind," Wood said during the discussion preceding the vote.
I'm not sure, as the replicator apparently requires segregated elemental/molecular materials to build the target. Though seawater contains pure gold, seawater is not a component of "pure gold". However, pure gold and a hundred or so other elements could certainly be fed into a replicator to produce "pure seawater".
Simple filtration of seawater would be as effective in producing pure gold, even now. But will the free market price of the gold extracted cover the cost of power consumed in running the filtration process, the labor and capital costs, and the environmental costs? I guess if we could get the Federal Reserve or the Treasury to subsidize us...
That's a "Catch up" on the DISCOUNT rate which was only dropped a quarter point yesterday. It's the FED FUND rate that was dropped the half point yesterday.
@ RossL, John Doe: It's that nutcase with the �Matter Transmuter" that could make unlimited Gold. Now that could really mess up the distant future's economy per Holtzman's post today.
Maybe we could make a good one hour episode script out of this. I think the going rate for those is 20-40K. {:-))
Transitional performances always appear crippled due to the suboptimal operating conditions for the ultimate design task
To wit, battleships getting a tug out of harbor...jet airliners being pushed around at the terminal...euro gold reserves under a dollar-based derivative scheme of pricing as the euro begins to rise (dollar begins to fall)...etc.
In the European Central Bank's final weekly financial statement for the year 2000, through the quarterly mark-to-market revaluation process we can see the two reserve systems at odds now that the euro has established a meaningful uptrend against the dollar. As the much-discussed price discovery mechanism leaves gold listless with respect to the dollar, the rising euro/dollar exchange rate translates into a shrinking level of reserve assets when denominated in euros.
As such, the total gold assets of the Eurosystem registered a numerical decline on the ECB consolidated books of 7.874 billion euros to 117.073 billion euros from the previous week. (If the extant gold pricing mecahnism does not allow for a separation from the dollar and its current structure under greatly weakening dollar, just imagine the potential for additional physical offtake that cannot be supported at the hands of rising foreign currencies). Buy gold now and bide your time.
In the paper arena, the ECB's consolidated foreign currency assets fell in level by 13.7 billion euros to 254.5 billion euros to mark the end of the quarter and the year.
On a somewhat related note, with Greece now on board as of the new year, adjustments will likely be seen to the consolidated ECB financial statement next week to reflect the additional gold reserves. It should also reflect the net adjustment to forex paper as any current ECB-held "foreign" Greek paper becomes domestic and as non-euro Greek-held forex paper bolsters the ECB's consolidated mix.
M-3 was up $35.5 billion this week! Holy Moley! What are we, mobilizing for war? I hope everyone in here is getting the significance of these weekly money supply numbers.
You've touched upon the raging debate among futurist writers and their audiences. Science "fiction" is fiction more or less adhering to the limitations of known physics, or at most, hyper-advanced theoretical physics, whereas science "fantasy" does not adhere to these constraints. Switching dimensions is common way around this while still retaining some "plausibility". Some sci-fi fans go ballistic when the author willy-nilly switches between the two or blurs the line of separation.
For the Earth-bound, I would categorize molecular matter transmutation as science "fantasy", whereas the replicator is firmly science "fiction". The transporter is probably somewhere in between...depends on the design and operational parameters.
I don't believe future alchemists will have any better luck than the Medieval, unless you'd call massive explosions and radioactivity a success... :o)
PS. All gold comes from the cores of exploding stars!!
We all know that markets move in anticipation of events and then often move against their effects when the events actually take place.
Several months ago, I suggested the decline of the euro was in part due to the fact that it was being discounted for the impending dilution of value as the smaller economies and the former iron curtain disasters were folded into the mix.
Now that is taking place and the currency is recovering. Not to say that is the �only' factor but as is always the case in a planetary economic system, one of a group of factors whose summation determines direction.
-------
Also, beesting, Mr Gresham and CavenMan have all seconded my nomination for Holtzman's masterpiece.
Are not the stars the crucible from which all the elements are smelted? If Gold and all the rest can be formed from the basic fusion furnace fed by hydrogen, then is not the formation of the elements a physical process whose secrets could be some day unraveled and manipulated?
Your assertions are correct. Nearly all the elements are byproducts of a very natural process -- solar fusion followed by supernova explosion. Unfortunately, that process operates on a solar (! not planetary) scale (lots of matter), involving unbelievable amounts of energy, over eons of time, and the elemental end products are highly radioactive, requiring further eons of time to dissipate and stabilize.
The limitations in replicating such processes, in miniature, safely, economically, and in a controlled manner are likely beyond human ability (or need). It's much, much simpler to use the bankers' alchemy, the REAL alchemy. Want gold? Make up "money" out of thin air, convince (or force) people to accept that it has "value", and "buy" all the gold you could ever want. Need more gold than exists? Good luck.
Now, Greeks I know something about but, I digress....
Could the following be correct:
1. FED targeting share market and by extension, US economy.
2. "Katy bar the door" with money supply growth.
3. Dollar is sacrificed in the process and falls against Euro and perhaps other world currencies.
5. Inflation gains.
4. US trade imbalance improves.
5. To stem the dollar's slide, gold is sold down the drain in paper market as the dollar is an alternative to gold.
6. Dollar continues to weaken.
7. POG dropping.
8. Physical demand accelerating.
9. At some point physical is exhausted vis a vis futures and new gold market begins.
BUT, what if Euros are "bought" instead of gold. Then, dollar drops, Euro rises and gold falls but, since gold is settled in USD, ECB books and their "mark to market" strategy make them look like heroes. Gold is held in check and European CBers continue their fiat game. Gold then is kept in the closet until Euro exhausted. What's going on here? Thanks....CM
"As the last two decades have demonstrated, gold is not always a safe haven. However, with each grindingly lower year, gold becomes more and more a safe haven. But how much lower can it go? Quite a bit. Will it? There's no way to know"
...and...
"Hope lies in realising that it's not necessary to achieve perfection. As most leaders of men will readily affirm, it's almost always unwise to try to acquire 100% information before making a decision. The final 5% will take longer to acquire than the first 95% did. But more often than not, being 95% certain of something is sufficient."
So now that I am 95% certain that gold is undervalued is it unwise not to buy?
Stranger. . .Thank you for your astute updates on the inflationary situation. I too have marvelled at quality and content "deflation" as the government and Fed brag about "inflation" being under control. On M3, I wanted to throw out the conjecture that much of this out of the box growth has to do with "old money" coming out of the stock market and reincarnating in money markets. I was introduced to this concept a few years ago by Richard Maybury who ran some studies where he included the money invested in stocks as part of the money supply ( I believe he worked on that with our mutual mathematically inclined friend, John Carder) -- an interesting concept that inferred stocks as a form of "money" and drove home the point that though money was not available to push the prices of goods and services higher, it was available for such. The longer the Fed forestalls a liquidity searing crash, the greater the possibility that this money migrates to money market accounts, and in my estimation eventually to gold when investors realize that we are at a way station to massive inflation. As an interesting point of information that you would consider important, I am increasingly on the phone with financial advisors and money people looking to move their clients into gold. These people are astute and usually ahead of the thundering herd. I think it telling. My best to you and your family for the New Year.
Holtzman. . .I have to say that I thoroughly enjoyed your post today. I took some time at the end of the day and my staff , I think, may have thought me going daft as I chuckled out loud reading your entertaining and thoughtful post. You, sir, are not only astute, you have a marvelous way of presenting things. Thank you for posting here and I look forward to much more of the same.
Paul van Eeden: Welcome and thanks. We are privileged to have you pull a chair to this extraordinary table. Your Introduction to Gold which resides at our Gilded Opinion page is a masterpiece. There are so many levels to the rate cut -- so many points of discussion -- that I don't think we could possibly cover them all even here. But I welcome you to try. (smile)
All: Just as I thought we might have reached some sort of zenith, it gets even better. You have made this what it is -- so many quality posters and so profound that you pull up the page start scrolling and have difficulty choosing where to start. I would not even attempt to start naming names with respect to my appreciation. Just know that I appreciate what goes on here and couldn't be a prouder of our mutual achievement.
Randy: Thanks for everything but mostly for your spot-on daily comments. It was important today that the Asian central banks moved to lower their rates in response to the Fed while the ECB held fast. That which is hidden shall become known (and things are moving fast). Isn't it interesting how the needs of Europe have somehow coalesced with those of the U.S.? Perhaps that is what cycles are all about. Also, I think we better make sure that the Holtzman post(s) take their rightful place in the Hall.
FOA: Thanks for your timely return. I must say what I said to Randy in private: I usually do not realize how much I miss you until I read that first post upon your return. As I have said before that chair is always reserved for you, my friend, no matter what. And we also keep one near for our good friend, Another. Just in case. By the way, how did you know that AG was going to make his move? I could not think of a better scenario for gold than what has unfolded in the past 30 days. Yes? My best to Another.
To everyone: Respond if you wish, but I didn't post any of this to get a response.
If, following the Gold Trail one concludes that the USD is on its' last legs and that the Euro is the next "world reserve currency", then why not denominate your wealth in Euro and not gold? My small Euro investment is the only winner I have at this juncture. Is part of the answer that gold has no borders? My Euro's can only be spent without exchange in Europe but; 1. I can bring them home in exchange and 2. If we'll all be using Euro someday (I do NOT agree with that opinion) then, I won't need to make any exchange just be patient.
Something just dawned on me and I am probably wrong but...
1. Do European CBers have more confidence in gold than they do in their own currency? After all, a gold standard is not coming back right? True, France, Germany and Italy are large gold holders but, their monetary regimes are fiat. Fair weather friends are they yes?
2. Why wouldn't ME interests sell dollars for Euro and denominate a large part of their wealth in Euro? Regardless, they will still be buyers of gold in significant quantities. After all, the Euro is the next reserve currency. Everybody wants to own it right.
Not trying to be argumenative to the disadvantage of someone not here now, often but, these are my humble thoughts.
FOA has said that oil backs the Euro. I think the Euro is drafting behind oil. I think there is a strategy to put all that gold out to leverage; massive, paradigm shifting leverage.
There is no way I can think of to take one's money out of the market without getting someone else to put an identical amount in (Asher's Law). The effect on the money supply of all this selling, therefore, is net zero, unless you know something I don't.
Clearly, the Fed has been buying bonds. In 5 weeks, M-3 has grown by some $141 billion, an annualized growth rate which is north of 20%. This, and not the fed funds rate cut, is the real story of recent Fed activity. Greenspan is trying to avert a worsening recession scenario, and inflation is the weapon he has chosen.
Thank you for your gratitude. I greatly enjoy contributing to this marvelous forum you have created. It gives me something to do while I await the inevitable mother of all gold rallies.
Peter, thank you for keeping score and bringing the tally to my attention.
Cavan Man, I would be wary forming your conclusion (i.e., "Gold is held in check and European CBers continue their fiat game. Gold then is kept in the closet until Euro exhausted.") from the speculative flow of events you present in your msg#: 45056, particularly those of the paragraph following the numbered sequence.
If I may, let my share my thoughts on your item #5: "To stem the dollar's slide, gold is sold down the drain in paper market as the dollar is an alternative to gold."
While I do see the potential for selling of gold derivatives "down the drain", I do not see it being done to effectively stem the dollar's slide in any material way, nor could it. The forex rates and import prices would already tell the tale. The potential I see for continued selling of paper gold under a falling dollar was expressly described in my post yesterday as follows:
---(usagold.com msg#: 44963)---"If you are a hedge fund that has previously borrowed gold from a bullion bank in order to raise a source of low interest funds for investment purposes, please marvel how very easy it is to offer the short side of futures contracts as necessary to create the stagnation in this realm of price discovery as needed to buy the time (and metal!) to unwind the prior gold loans. Simply put, some financial "chapters" are written for the benefit of the overall book."
But then, as stated more recently, I would say again, "If the extant gold pricing mecahnism does not allow for a separation from the dollar and its current structure under greatly weakening dollar, just imagine the potential for additional physical offtake that cannot be supported at the hands of rising foreign currencies." The situation would not endure for any length of time, and eventually lead to an adjudicated work-out of the positions in the shattered gold derivatives market.
This is why I recommend and hold personally ONLY an advance position in physical gold metal. As for mines, I have little faith in management's ability to navigate the possible volatile pricing turmoil (Ashanti upside, bankruptcy downside), and less faith in government's resolve not to administer windfall profits taxes or otherwise orchestrate a gold-style Texas Railroad Commission.
Hello Cavan Man. Interesting thoughts you have to share on Euros. I am also considering holding a small portion of my meager wealth in Euros. A couple of years ago I contacted the Mark Twain Bank, near St.Louis. They were offering savings accounts denominated in foreign currencies. I didn't take any action at that time. Last week I attempted to contact the bank several times, but the phone number was not working. The feature I found most attractive about the accounts they advertised was the ease of convertibility. If I remember correctly, you could exchange your account dollars for yen, or other major currency with very little fuss. I believe the minimum account was $2,500. What a forward thinking bunch of folks! Does anyone happen to know of any bank that offers such a service for small account balances. ($10,000 or less) It isn't that I'm finished buying gold, far from it. But with all the hanky-panky that seems to be going on with the Wizard of Fed, I'd like to be able to diversify my "cash" holdings. Suggestions anyone?
Most of the discussion here is speculative here is it not? I am a friend of gold and a customer of CPM but, if a thought seemingly reasonable strikes me and I need to bring in here for impaling I should do so as (hopefully) a service to all.
In Europe, for the most part, we're talking about government officials who are died in the wool socialists; much worse than here--much worse. We're talking about generations of people who have been socialized in a system that is the antithesis of the pure, US model. We are talking about people who are at once fundamentally the same as US and then again, radically different. We're talking about people who by and large are not big fans of the US.
I assure you, my use of the phrase "speculative flow of events" in regard to your presentation was not intended as a snipe in any way. It was merely a manifestation of my affliction to be accurate where possible. I did not allow myself to simply refer to the "flow of events you present" because those are not yet actual events. I modified the phrase with "speculative", but I see now I should have saved us both agony had I chosen the term "hypothetical" as a modifier. It must be well past my time for sleeping.
|-)
Okay. I checked it out. The total increase in money market funds for the latest two weeks combined was $38.5 billion. To be sure, this is a good chunk of the $91 billion M-3 increase during the period . But the decline in the stock market for the corresponding two weeks (with three day offset to account for settlement) comes nowhere near to explaining such a whopping increase in money funds. The Nasdaq was only down by 160 points for the two weeks ending December 29, and the Dow Jones Industrials were actually UP 100 points.
Also, most of the gains were in institutional money market funds, which is right where one might expect the proceeds from large t-bond sales to wind up.
I don't think these data support your conjecture, Michael, but I am listening if you have any other thoughts.
Over on the BearForum.com, they are talking a lot about mutual funds redemptions. Seems that billions are suddenly coming out of the mutuals and would be going into money markets and bank deposits. What do you think?
"...physical gold is about to become the only portion of the gold sector that will perform,,,,, and perform as no other asset in history ever has!" FOA (01/03/01; 08:50:37MD - usagold.com msg#50)
Much as I have always been convinced by FOA and Another's vision, I am having fun trying to get my mind around this.
Apparently, the paper gold Comex futures market will have to be dismantled before there can be any separation between the paper and physical worlds. Around here, it is taken for granted that such a distinction already exists. However, last I heard, there still existed something called "delivery notice"; the day on which holders of contracts must declare their intention to stand for delivery. Because if an investor wants to, he can request delivery on his contracts.
Now, let us conjecture for a moment what that means. Let us just suppose that instead of buying 100 ounces of gold in the form of coins from MK, I decided to purchase a February contract on the futures market from my local futures broker. Instead of buying a large number of contracts with my available $27,000 cash, I adopt the unusual tactic of purchasing a single contract. On first notice day I declare my intention to accept delivery. At this juncture, (as the system is presently functioning) I would eventually receive my gold.
Now, for a physical market to open up separately as FOA forecasts, the paper-based futures market would have to vaporize instantly. Otherwise, anyone noticing that prices were higher on the physical market, would merely opt to stand for delivery and sell the delivered gold there. Far from causing the futures market to fall farther, it would merely explode higher as investors took delivery at Comex and sold it on the new Euro physical market.
Maybe this is where the forex rates become critical to the scenario. It looks like the Euro will have to first appreciate hugely against the dollar to prevent this option from being carried out by rank and file investors. It will probably mean that currency controls will have to be in effect also. What a different world they have in mind for us! And all this before 2001 is over?
Something else that keeps boiling to the surface of my mind: Greenspan's antics these past two days! At the last FOMC meeting, the board of governors decided that no rate change was necessary. Now, suddenly, a .5% cut is needed? One-half percent needed now that wasn't needed two weeks ago? Kind of hard to believe. I mean if a half percent is needed now, why wasn't at least a quarter point needed two weeks ago? Have things changed that much in two weeks?
Furthermore, are we to believe that yesterday's rate cuts were implemented for good and valid reasons that existed yesterday, and that today the situation had changed so that a different interbank rate is now called for today that wasn't called for yesterday?
This does indeed stretch the imagination. Or was it just that Greenspan forgot to cut the interbank rate by today's additional .25%? Was yesterday's rate cut a mistake that had to be corrected today?
Just what is going on here?
Why do I have the feeling that I'm missing something?
@Pandagold - Your posts about the shadow government
While I agree with almost all you stated, I don't think that this can go on indefinitely. China, for one, won't go along. And don't count the Russians out yet.
Trade rivalry between the US and EU will soon boil over into economic warfare. In the long run expect them to be at each other throat. When and how this will happen ? Pretty hard to say. But we are certainly going to live in interesting times. (Chinese meaning)
PH - I hope my posts #45063 and especially #45065 take care of your question. I just went through all the numbers and I think I am getting this right, despite what uyou may be seeing elsewhere. Money simply can't just come out of the market, mutual funds or otherwise. Every share sold has to be bought by someone else.
Now, I hope the room will forgive me an unabashed expression of naivete and glee. I am convinced that EVERYTHING is now right for gold. I simply cannot imagine it ever being as cheap again in dollars as it was today. I am so convinced in fact, that I can hardly contain my excitement. My seatbelt is fastened for what I see coming in the next few weeks and months.
Most on this board are prepared for what is coming, the LA times today did not mix their words.
Effect of State's Energy Crisis on Economy May Have Worried
Fed
By JAMES FLANIGAN, Times Senior Economics Editor
The California energy debacle is rapidly growing into a financial crisis that could trigger bank failures, disrupt funds available
for lending to businesses and consumers and spark general chaos in global markets for corporate bonds, financial experts fear.
http://www.latimes.com/cgi-bin/print.cgi
Such fears may well have been a factor in prompting the Federal Reserve to dramatically lower interest rates Wednesday,
analysts suggested.
The energy crisis poses a spreading threat to the whole banking system, given that the crisis is occurring against a backdrop of
a sharply slowing economy and fears that more corporations may default on their debts, analysts said.
A lowering of interest rates doesn't solve the energy problem, but it would ease the plight of California's embattled utilities by
reducing their borrowing costs. That in turn would reduce pressure on banks and other participants in global markets that provide
credit to those utilities as well as other businesses.
Also, whether intentional or not, the Fed action in effect sends a signal to financial markets that the central bank will support
attempts by California's utilities and political leaders to work out a solution to the companies' credit problems, analysts said.
But though Fed action inspired a rise in the general stock market, initial action by the California Public Utilities Commission
had the opposite effect Wednesday on the state's major utilities, Southern California Edison and Pacific Gas & Electric. The PUC
staff issued an initial ruling giving the utilities a temporary 7% rate hike to alleviate their problem of uncollectable costs and rising
borrowings. Financial markets evidently saw that as too little, and investors send stocks of both companies into steep declines.
To be sure, the Fed's lowering of interest rates was prompted by many factors related to the slowing of the economy. But
several experts suggested that California's crisis was a factor, noting that Fed Chairman Alan Greenspan held a highly unusual
public meeting in Washington on Dec. 27 with Gov. Gray Davis to discuss the California energy situation. Davis also met with
President Clinton during the same trip.
Until recently, the plight of Edison and PG&E to finance purchases of electricity at higher prices than they could charge their
customers was thought of as an energy problem largely confined to California.
But as the utilities' borrowings from banks and in corporate money markets have mounted, to an estimated total of more than
$10 billion, the dangers of defaults, bankruptcies and withdrawals of credit have escalated.
As such, the California energy crisis draws parallels to the Russian currency crisis of 1998. Fears that a Russian financial
collapse could trigger a global financial crisis prompted the Fed to lower rates suddenly that year, just as it did Wednesday.
The problems of Edison and PG&E have multiplied as costs have risen for the electricity the utilities must purchase from
generating companies. The utilities cannot pass on such costs to consumers because of a rate freeze dating to California's
electricity deregulation in 1998.
The utilities' loans from banks and financial markets have grown to such an extent that credit-rating agencies such as Moody's
and Standard & Poor's are threatening to downgrade their credit ratings.
"It will be hard to refinance those loans," given the utilities' worsening credit situation, said Joan Payden, president of Payden
& Rygel, a Los Angeles investment firm. "If their debts are downgraded, we could have illiquidity in the markets."
The companies face the prospect of seeking protection from creditors under Chapter 11 of the Bankruptcy Code, which allows
firms to operate under court supervision while terms are worked out with creditors.
If the debts of Edison and PG&E were downgraded to a category of less than investment grade--equivalent to "junk"
bonds--the consequences for the financial system would be severe, as would the consequences of bankruptcy.
Many pension funds and other investing institutions could no longer hold the utilities' bonds if they were not investment grade.
The sums involved are enormous.
Like all utilities, Edison and PG&E must borrow heavily to purchase and maintain equipment for providing electricity. The total
of the two firms' long-term bonds is more than $20 billion, all held by pension funds and institutions worldwide. If such
institutions were forced to sell those bonds, the result would be major disruptions in financial markets.
If the utilities were forced into bankruptcy, the effect would be devastating on banks, including giants such as Bank of America
as well as smaller banks, and on the commercial paper markets, where companies borrow and lend to each other, said William
Gross, chief bond manager for Pacific Investment Management Co., a Newport Beach firm.
This could lead to some bank failures and other problems in the banking system, analysts said. At the very least, loans to small
businesses and mortgages for consumers would be reduced.
The specter of such trouble was a major factor leading the Fed to lower rates Wednesday, said economist William Rhodes of
Williams Capital, a New York-based investment bank.
Since the Fed's open market committee last met Dec. 19 and declined to lower interest rates, there have been several continuing
indicators of worsening trouble in the economy. Notably, consumer confidence was reported to be falling in the latest study from
the Conference Board on Friday, manufacturing slowed sharply, and the debt problems of California's utilities have mounted. The
Fed's action sends a powerful signal of support, but a lot still hinges on action by the state's PUC.
The PUC issues a final ruling today on the rise in electricity rates it will allow Edison and PG&E, so they may recover some of
their short-term under-collections on electricity purchases. Standard & Poor's and Moody's have said they are watching the PUC
decision closely to determine whether they will downgrade the utilities' debts.
But prospects are not hopeful. The PUC staff's initial ruling Wednesday was for a lower rate increase than financial markets
were looking for, said security analyst Brian Youngberg of Edward Jones & Co., a St. Louis-based brokerage firm.
Edison stock fell 18% and PG&E stock fell 13% after the PUC initial ruling was announced.
Copyright 2000 Los Angeles Times
One thing I don't think we completely understand is the role of the specialist in all this.
In "Maestro" by Bob Woodward there's a passage about the 1987 Crash that I found fascinating. I refer to it only as a means to begin understanding the role of the Fed, the specialists and the brokerage firms play in "providing liquidity to the market." Greenspan had just come on board and the stock market goes in the tank. Corrigan from the New York Fed calls Greenspan and tells him "(Expletive)We don't need a scholarly, legalistic thing. We've just got to say in one sentence, we're going to put a lot of money into the market. Says Woodward, "In part we had a plumbing problem. Eveyone needed to be assured they could get money -- in other words liquidity or credit." Greenspan complied with the one sentence announcement: "The Federal Reserve consistent with its responsibilities as the nation's central bank, affirmed today its readiness to serve as a source of liquidity to support the economic and financial system."
That was as much a statement of philosophy as it was of immediate purpose.
I would think that the situation now with mutual funds being flooded with redemptions, international selling, etc. that there is a possibility that the Fed is "providing liquidity" once again and that may be part of what the rate cut was all about.
I have no doubt that the Fed is buying Treasuries and sending hot money into the economy, Stranger, and that might be the lion's share of the surge in money supply as you indicated. It is my view that the specialist being fed through a credit line linked directly to the Fed might increase the money supply without a consequent reduction in the money supply from a buyer. At the very least the direct buyer to seller relationship you describe might be delayed. Otherwise why would Corrigan have made the call to Greenspan in the first place asking for Fed liquidity. Theoretically, a buyer would have been standing there money in hand waiting for the seller to show up stock certificate in hand. Since he wasn't what was the effect on the Money Supply?
All of this though is a technical discussion among market afficionados. In terms of the effect on the economy and all of us as individuals operating in it, the source of the money supply isn't as important as the fact that it is growing at an alarming rate -- as you indicated. Inflation is coming from every direction and the Maestro is orchestrating it.
I put this in the conjecture column because at this point we do not know if something similar to what happened in 1987 is happening now. We do know that stocks are being liquidated and we do know that mutual funds are reporting problems. We won't know, I'm afraid, for quite some time, how the Fed is reacting to these events behind the scenes.
Check out internet bank, everbank.com. They offer something like 30 different foreign currencies, and foreign currency cds, all (theoretically) insured by the FDIC up to US$100K -- convenient, safe, and liquid. Or maybe look into the many mutual fund foreign bond funds for the shotgun approach.
Your solution may lie in bonds of various types, and there are all sorts of types out there, and usually you can buy in $5,000 tranches. As I recall, there is a Kingdom of Denmark gold backed bond, denominated in yen or some equally strange combination. If you want exposure to euros, there are bucket loads of them.
I do not own such vehicles, nor do I recommend them, because of my beliefs, which seem to be somewhat at varience with yours, and many attending this forum. If that will do the job you want to do, then go for it.
Recently some posters have inquired about gold mining stocks. I am not going to debate the stock vs. physical question here. What I do wish to examine is the reason for buying gold stocks, and why one is better than another. This of course would require that we look into the forward sales issue. This debate has raged here and on other gold forums. There is also the debate over marketing gold as a hard asset for currency reserves vs. jewelry, and the amount of funding by the gold industry for marketing purposes.
To Hedge or not to Hedge:
Hedging strategies such as forward sales were primarily used to fund acquisitions or to expand mining operations. Now that has moved beyond a survival strategy to a hedge fund strategy consistent with the so-called "gold carry trade." Occasionally these strategies go terribly wrong as evidenced by the near insolvency of Ashanti Gold (ASL) and Cambior (CBJ). When the Washington Agreement called for the restriction of gold leasing and forward sales by EU member banks in 1999, the price of gold rocketed higher. These two hedge fund gold miners found themselves kneeling before the boards of their overlord bankers with hat in hand begging for mercy. The question is whether forward sales are really even necessary. Some gold producers are true gold producers that have a stated policy of providing a leveraged exposure to the gold price, thereby benefiting from a rise in the price of gold. Other hedge fund gold miners prefer to be at the mercy of a rising gold price, thereby reflecting a no-confidence vote in the very product that they produce.
Gold prices have appear to have bottomed out. Now is not the time to hold heavily hedged positions. Many producers are eating out of their hedge books and are not replacing reserves in spite of an annual gold supply deficit of nearly 1400 tons. Many producers have been high-grading their reserves in order to survive the low gold prices. This situation can not continue much longer and several producers are going to start taking huge write-offs and begin closing mines in the very near future. Some producers have borrowed to the hilt in order to survive, and by doing so they have taken on untenable hedge positions. Many banks have demanded that producers hedge future production to reduce risk. Newmont Mining (NEM) at the behest of banker/broker Goldman Sachs was forced into hedge positions in order to maintain their bond rating. Unfortunately, days later the Washington Agreement was made public and Newmont suffered. As with most of these hedging strategies, it is the shareholder who has to forfeit future returns to pay the banks "low-risk" funding. Unfortunately, some corporate officers tend to use these strategies and no real benefit is realized by the shareholder. Take Barrick (ABX) as an example. The shareholders of Barrick get no return and a pitiful dividend of 1.2%. The only beneficiaries so far have been Barrick's corporate officers who enjoy fat bonuses. Alternatively Harmony is more generous with their dividends while proudly and publicly stating their "No-Hedging" policy in their most recent annual report.
So the question is whether hedging is really necessary or is it an obstacle to a rising gold price? Heavily hedged miner certainly do not want higher gold prices as evidenced by Ashanti Gold (ASL) and Cambior (CBJ). When Jay Taylor, CEO of Placer Dome Gold (PDG) declared that his company was reducing its hedged position, Barrick's management was very quick to declare that they were not. Not surprisingly, after the Placer Dome announcement, gold prices rose dramatically, however, when Barrick made their announcement, the price of gold cratered. Why was that? Why is Barrick afraid of a higher gold price? Simple answer, look at what happened to Ashanti Gold and Cambior when gold prices increased. Barrick also was quick to buy 10 million ounces worth of calls shortly after their announcement. Obviously, Barrick and other hedge fund miners simply cannot survive if the price of gold rises dramatically.
I have looked at the value of holding both hedged and unhedged gold mining shares. Of the 6 largest gold miners I have culled information from 2 unhedged gold producers - Harmony Mining (HGMCY), and Goldfields (GOLD), and 2 hedged gold producers � Barrick (ABX) and AngloGold (AU).
HGMCY: PE � 7.3, PEG � 0.243, and Growth Rate � 30%
GOLD: PE � 15.9, PEG � 1.06, and Growth Rate 15%
ABX: PE 20.2, PEG � 3.36, and Growth Rate 6%
AU: PE � 9.6, PEG � 1.14, and Growth Rate 8.4%
*PE � Price Earning ratio and PEG � Price Earnings/Growth ratio.
Obviously hedging gold production is not necessary nor does it appear to add value to the company. HGMCY is arguably the most profitable gold company. It is unhedged, pays a good dividend, and is growing dramatically. The major gold hedge fund producers in this example, do not provide much value if any to the shareholders. The question is why do some producers continue to hedge and depress the price of gold? It would appear that they are too deep into debt and in the clutches of their banker overlords. They appear to be trapped and that is the reason why every time the price of gold rises dramatically, they are there to talk down the price of gold and discourage any would be investors. Even so, some unhedged producers are light on their feet and can profit even as others denigrate their product.
Marketing Gold:
Most of us know that gold is undervalued and will rise in the future. Timing the market is a fool's game. Some miners even prefer to pay a dividend to their shareholders as a reward while awaiting the inevitable rise in the price of gold. Some miners even participate in the marketing of gold and some even have their own bullion and jewelry concerns.
The gold industry has done a miserable job as a marketer of its product. However, unlike other mining businesses, gold mining highly fragmented as there are over 300 gold mining companies providing gold on the world market. For example, the PGM industry has 4 companies that provide over 87% of the world's supply of platinum. The 13 largest gold producers provide a mere 39% of the world's supply of gold. Am I proposing a gold cartel as with oil or diamonds? Of course not. What I am saying that the marketing of the gold could be a concerted effort by the industry as a whole with at least a modest amount of support by the world's miners.
The World Gold Council has recently doubled their expenditures to promote gold. AngloGold (AU) has also combined with PAMP of Switzerland, and JP Morgan to provide various gold products and services. Harmony Gold (HGMCY) even sells its own branded gold to clients in India and Europe. Of course, Harmony is also the world's only producer that refines its own gold at the mine-site. However, the marketing campaigns are too few and fall short of similar campaigns in other industries. The diamond industry spends about 3% of its annual sales on marketing. The consumer industry spends about 4% of its annual sales on marketing its products. The gold industry spends a miserly 1% with the gold producers contributing about a 10% of that. Even De Beers, the diamond producer and marketer has the famous slogan � "A Diamond is Forever." What does gold have as a slogan? Sure, Harmony Gold has a marketing slogan � "Think Gold, Think Harmony Gold." But why are there no marketing slogans about gold as a product? What about marketing gold as a symbol of status and financial security? Unfortunately the gold industry has fallen short.
- Black Blade
Sources:
Harmony Mining annual report 2000
Placer Dome Gold annual report 1999
http://www.Quicken.com
http://www.gold.org
http://www.Zacks.com
Other: Various news reports, internet sources relating to gold, gold investments, and equities research.
If the Fed is loaning money to the specialists, then right, that's new money supply. ALL of the money supply is created by being loaned into existence. But, it's not a gift, it must be returned with interest. When the specialists have squared their books, that money should be back in the hanger. Seems to be it would be like those overnight infusions.
Regarding that fellow who said the market is part of the money supply: He would be correct if he recognized it as a PERCEIVED money supply. In fact, as I said two years ago (The fifth currency post), stocks function much more as a currency then as a certificate of ownership because their share price is so far out on the limb of future anticipation.
I had gotten as far as writing "-Money spent on stocks is money supply that has changed hands, period!" But Stranger has already stated it perfectly in two posts this evening.
Oro #44964: "The "Dead Body" ... was still missing from public view. Needless to say, there must have been one and the corpse must have given off quite a heavy stench at the Fed's undertaking facilities. " I love it when you let the gallows humor just roll off your keyboard. It's timed so well after the output of little-known facts and numeric surmisals you provide us. Thanks, again.
Tar sands, yes. I had a housemate in the early '80s, PhD in math I think, who had done a stint for the Trilats in Toronto researching and cataloging all the mineral resources in Canada. Wholly-owned subsidiary of USA in a pinch, eh? Just as the CFRs in the 30s strategized the Grand Areas roping off of the Pacific vs Japan that led to Pearl Harbor?
Oro, what institutions among the TBTF are likely to also be TBTR (Rescue) if too many TBTFs line up with hands outstretched? In other words, there must be a decision process going on now of prioritizing the rescues, so that stronger balance sheet financial firms (like the S&L crunch) buy up the weakers. Who do you think is on each side of the list?
Further thought, this really might be a test of the question of the unified financial "syndicate" theory, whether there is consensus on loading the debts onto a few poor beasts and delivering a bullet to their skulls, vs. any and all struggling tooth and nail to survive at the expense of one and all.
AG's priority is, as it was in 1987, to protect the system of payments clearing, so that insolvencies do not happen to institutions merely because of seize-ups in clearing payments due from other mostly-solvent counterparties. That is where the Fed interposes with liquidity.
Herstatt risk. That's like saying "BOO!" in the dark to a central banker.
Hmmm, I was going to put more in this post, but the winds outside have a high probability of blowing my power out, so I'll get out of here now. It's been quite a day.
We monetize our future labors ("I'll work to pay that back") by borrowing for current consumption. And if you lost your job for too long a time, well, you might have defaulted on your debt.
What has changed is the solidity of intention to do that paying back. I would say the psychology today is: "I'll pay that back if my stocks go up, as we all agree they must."
In a market crash, people will find it hard to service those debts, EVEN IF they keep their jobs. And many more of them will lose their jobs, to boot.
So the quality of the debt as debt money was compromised from the start. That is why it was offloaded to offshore funding corps, much of it, and slipped into money market funds, where one and all -- savers and debtors both -- might be fleeced of their cash balances.
For the first time in a very long time a major broker, Salomon Smith Barney, is recommending gold as an investment. And it is not one of the subsidiary offices which is taking this stance, but the big boys in New York via the Global research department.
The message from New York is short and to the point. "Gold bulls....don't give up....you're time will come," so plead the precious metals team in their GYRUS Update 2000. "Long-suffering gold investors have all but given up. We think they shouldn't. The last 18 months have been unusual for the industry as gold has lagged rather than led the commodity price cycle.
The consensus bear case is well established and a record-high US dollar masks the trend. We believe gold has found a protracted bottom. Our longstanding bull thesis on gold is predicated on a massive deficit of 1,000 metric tonnes, or 24% of the market.
Amongst all of the doom and gloom that is battering the global equity markets, it appears that gold may again, (for the first time since '96), be rediscovering it's sparkle."
You cannot say fairer than that, and the share recommendations from SSB's Australian office are also interesting. Newcrest as its best absolute recommendation, Normandy for liquidity and Hill 50 in the mid caps. They go on to say that if the thesis is correct and gold is indeed coming off the bottom then almost all gold equity prices should improve dramatically.
In the US the top large cap gold producer is considered to be Newmont Mining.
America is about to get a wake-up call on Natural Gas. Sure, we have been hammered as the bills arrive in the mail box, but the Grasshoppers in California are about to get a real shock, as rolling blackouts become the norm. Moodys has relegated the bonds of California's utilities to "Junk" status. The Grasshoppers are getting very angry and blame the utes rather than their own stupid NIMBY attitude that put them there ion the first place. The misguided environmentalism is a big contributor to the problem. These problems are expanding eastward now, as Grasshoppers everywhere are about to feel the bite of old man winter. Matt Simmons of Simmons and Company International and industry researcher says to get ready for a decade long problem. The crisis is potentially worse than the 1973 and 1979 oil shocks. 53% of American homes are heated with NG, and NG currently generates 16% of the country's power. Government convinced many to use NG and yet did not provide incentives for producing adequate amounts. During the recent low oil prices, there was virtually no incentive to explore or produce NG or oil. The result is that there is not enough domestic NG to meet demand, and the shortfall is made up from Canadian resources. Adding to this problem is the majority of possible NG targets are on land owned by the US government. The US Forest Service and the Bureau of Land Management control most of the west's public lands. Over the last several years, these two agencies have sided with environmental groups that are opposed to drilling. Another problem is that coal and oil are considered "dirty" fuels, and power generating facilities that use "dirty" fuels have to use carbon credits provided under the EPA's Clean Air Act. That means that by year end, these facilities are closed down as their credits have been used. This ads more pressure to NG-fired power generating facilities. Over 90% of all new facilities under construction are NG-fired power plants. The economy is already in a severe downturn, yet soaring energy costs will only accelerate the market crash. The time is now for wealth preservation, and gold and silver are just the ticket. It will get a lot worse before it gets any better. The whole process of building power facilities and reviving the economy could take years.
Thursday, January 4, 2001 Effect of State's Energy Crisis on Economy May Have Worried Fed
By JAMES FLANIGAN, Times Senior Economics Editor
The California energy debacle is rapidly growing into a financial crisis that could trigger bank failures, disrupt funds available for lending to businesses and consumers and spark general chaos in global markets for corporate bonds, financial experts fear. Such fears may well have been a factor in prompting the Federal Reserve to dramatically lower interest rates Wednesday, analysts suggested. The energy crisis poses a spreading threat to the whole banking system, given that the crisis is occurring against a backdrop of a sharply slowing economy and fears that more corporations may default on their debts, analysts said. A lowering of interest rates doesn't solve the energy problem, but it would ease the plight of California's embattled utilities by reducing their borrowing costs. That in turn would reduce pressure on banks and other participants in global markets that provide credit to those utilities as well as other businesses.
Also, whether intentional or not, the Fed action in effect sends a signal to financial markets that the central bank will support attempts by California's utilities and political leaders to work out a solution to the companies' credit problems, analysts said. But though Fed action inspired a rise in the general stock market, initial action by the California Public Utilities Commission had the opposite effect Wednesday on the state's major utilities, Southern California Edison and Pacific Gas & Electric. The PUC staff issued an initial ruling giving the utilities a temporary 7% rate hike to alleviate their problem of uncollectable costs and rising borrowings. Financial markets evidently saw that as too little, and investors send stocks of both companies into steep declines. To be sure, the Fed's lowering of interest rates was prompted by many factors related to the slowing of the economy. But several experts suggested that California's crisis was a factor, noting that Fed Chairman Alan Greenspan held a highly unusual public meeting in Washington on Dec. 27 with Gov. Gray Davis to discuss the California energy situation. Davis also met with President Clinton during the same trip. Until recently, the plight of Edison and PG&E to finance purchases of electricity at higher prices than they could charge their customers was thought of as an energy problem largely confined to California. But as the utilities' borrowings from banks and in corporate money markets have mounted, to an estimated total of more than $10 billion, the dangers of defaults, bankruptcies and withdrawals of credit have escalated.
As such, the California energy crisis draws parallels to the Russian currency crisis of 1998. Fears that a Russian financial collapse could trigger a global financial crisis prompted the Fed to lower rates suddenly that year, just as it did Wednesday. The problems of Edison and PG&E have multiplied as costs have risen for the electricity the utilities must purchase from generating companies. The utilities cannot pass on such costs to consumers because of a rate freeze dating to California's electricity deregulation in 1998. The utilities' loans from banks and financial markets have grown to such an extent that credit-rating agencies such as Moody's and Standard & Poor's are threatening to downgrade their credit ratings. "It will be hard to refinance those loans," given the utilities' worsening credit situation, said Joan Payden, president of Payden & Rygel, a Los Angeles investment firm. "If their debts are downgraded, we could have illiquidity in the markets."
The companies face the prospect of seeking protection from creditors under Chapter 11 of the Bankruptcy Code, which allows firms to operate under court supervision while terms are worked out with creditors. If the debts of Edison and PG&E were downgraded to a category of less than investment grade--equivalent to "junk" bonds--the consequences for the financial system would be severe, as would the consequences of bankruptcy. Many pension funds and other investing institutions could no longer hold the utilities' bonds if they were not investment grade. The sums involved are enormous. Like all utilities, Edison and PG&E must borrow heavily to purchase and maintain equipment for providing electricity. The total of the two firms' long-term bonds is more than $20 billion, all held by pension funds and institutions worldwide. If such institutions were forced to sell those bonds, the result would be major disruptions in financial markets.
If the utilities were forced into bankruptcy, the effect would be devastating on banks, including giants such as Bank of America as well as smaller banks, and on the commercial paper markets, where companies borrow and lend to each other, said William Gross, chief bond manager for Pacific Investment Management Co., a Newport Beach firm. This could lead to some bank failures and other problems in the banking system, analysts said. At the very least, loans to small businesses and mortgages for consumers would be reduced. The specter of such trouble was a major factor leading the Fed to lower rates Wednesday, said economist William Rhodes of Williams Capital, a New York-based investment bank.
Since the Fed's open market committee last met Dec. 19 and declined to lower interest rates, there have been several continuing indicators of worsening trouble in the economy. Notably, consumer confidence was reported to be falling in the latest study from the Conference Board on Friday, manufacturing slowed sharply, and the debt problems of California's utilities have mounted. The Fed's action sends a powerful signal of support, but a lot still hinges on action by the state's PUC.
The PUC issues a final ruling today on the rise in electricity rates it will allow Edison and PG&E, so they may recover some of their short-term under-collections on electricity purchases. Standard & Poor's and Moody's have said they are watching the PUC decision closely to determine whether they will downgrade the utilities' debts.
But prospects are not hopeful. The PUC staff's initial ruling Wednesday was for a lower rate increase than financial markets were looking for, said security analyst Brian Youngberg of Edward Jones & Co., a St. Louis-based brokerage firm. Edison stock fell 18% and PG&E stock fell 13% after the PUC initial ruling was announced.
I've been away for a while, but have managed to check in on occasion. It is good to see that your informative posts are still as timely as ever. Actually the high price of NG is the reason I have not had time to access the forum for several weeks. Activity is so furious out here in the Powder River Basin that many of the guys I know have visibly lost weight in the last several months. 14-18 hour work days are the norm. As I'm sure you are aware from your vantage point, we are also having an "old fashioned winter" too.
From my point of view, it is time for the producers to refuse further investment until government gives some assurance that we will not be molested any further by the enviros. For instance it takes six months to APPLY for an air quality permit from Wyoming DEQ. All the units are basically the same, each application is largely the same except for location and horsepower. The actual testing and application takes about five days. No reason to drag out the process. But it has to lay in some looter's in-basket until it turns the right shade of yellow so he\she can not miss a coffee break. Let the bastards freeze in the dark! I have to each and every day, just for the priveledge of keeping the left coast on the grid.
from Kitco ForumDate: Fri Jan 05 2001 00:16
Cage Rattler (The Yen) ID#33155:
There are events going on behind the scenes that will cause the yen to significantly devalue with some explosive moves. Initially levels of 140 versus the dollar are being talked about. Be careful out there...
I know where you're coming from. I have to deal with the BLM on occasion and the permits are always being reviewed. Meanwhile, I have guys who are out of work while some government leech (bureaucrat) is working on getting his ass the same shape as the seat of his chair. A couple of my friends in Sheridan and Buffalo not working right now, probably due to weather. They hope to get back to drilling soon. I would guess that when the situation turns critical and votes are at risk, then activity will pick up significantly. When voters are freezing in the dark, anything can be accomplished ;-) I was just thinking how those of us in the industry were able to predict these events long ago. Fortunately I have profited nicely from government inaction and consumer (Grasshopper) complacency. I hope to do as well or better with my PM holdings. Take care.
I visualize Mr. Greenspan has fallen over Niagara Falls in a barrel after blazing down the river for the past few weeks. After fearing the flight for a while, the actual event has caused him to panic. Take note that the fear of SM investors escalating upwards through brokers, bankers, etc. has now reached the top. When #1 is sh*tting his drawers it is confirmation that the jig is up.
It is not a co-incidence that this coincides with Mr. Strangers boyish glee. (#45073)
All,
Several posters has asked how to convert dollars to Euro and European currency. This line of posting has increased dramatically in the past few weeks. If this escalation (at the individual level) is a sign, imagine what is going through the minds of the big money.
Money ALWAYS flows to the vehicle yielding the highest ROI;
and as apparent over the past couple months or so it is not in US demoninated currency.
This also co-incides with Mr. Strangers inflation warnings,
imagine US banks stuffed full of greenbacks with more coming in. Dilution of a currency is inflationary.
All: Great postings of late.
It's occurred to me, given recent events, that the A/FOA position on Gold market meltdown and subsequent Phoenix like rise of physical, is all the more plausable when one considers the "big-picture".
Under a $US world reserve Fiat situation as exists, the ONE threat to upset the Applecart has been Gold - and as we are well aware, through countless disappointments, the mechanisms for "control" of the POG are well and truely in place.
Now, through bad luck/management this $US is under seige from OTHER directions - BUT! the Au control mechanisms (designed to discredit Au vis-a-vis $US) are still in place.
No matter what the Dollar does, POG will not rise against it until the Physical de-couples. IMHO
0726 GMT -- Euro rose to 95.95 cents , fresh six-month high against dollar.-- U.S. operators aggressively bidding up euro against dollar, dealers said.-- Euro/yen quoted at 111.49/62 yen, off intraday high of 111.77 yen.-- Euro attracting demand as investors turn increasingly wary of outlook for both U.S. and Japanese economies.
Black Blade: Listen to the swoosh of cash flowing out of the US and back to Europe!
http://www.bday.co.za/bday/content/direct/1,3523,768109-6094-0,00.html PALLADIUM hovered near the 1000/oz level yesterday for a second consecutive day, but failed to convincingly break through the barrier because of a paucity of buyers in the market. The higher metals prices meant good news for platinum shares and for diamond producer De Beers. The magical $1000/oz level has been regarded as an important barrier for some time, as Russian shipments of the platinum group metals have not been forthcoming. The metal was bid at levels above the 1000 mark, but analysts said this was more a testing of the waters rather than a serious offer. UBS Warburg said in its report on the precious metal market that "the PGM (platinum group metals) market remains becalmed with very little interest. Although there are few sellers around, few buyers appear willing to pay up for all but immediate requirements."
Platinum did not fare any worse, being dragged higher by the high palladium price. Platinum was fixed in London in the afternoon at $632/oz, compared with $638/oz in the morning, a 13-year high. Palladium's price was fixed at $991/oz, compared with $993/oz in the morning and 987/oz the previous afternoon. UBS Warburg said Russian shipments would continue to dominate price movements over the next few months. "If shipments do not resume within the next week or two, then the price could head much higher. Although both metals should remain firm through 2001, it is hard to see the current levels maintained (especially palladium) once this temporary delay in Russian shipments resumes." The higher prices had a knock-on effect on the platinum shares on the JSE Securities Exchange SA, which continued to outperform most of the market.
Anglo Platinum, the largest of the producers, managed to add R12,20 a share to end at R342 a share, while its smaller rival, Impala Platinum, was up R10 a share to R362 a share. Northam Platinum gained 85c to end the day at R14,80 a share.
Platinum's firmness was attributed also to the fact that the US, thanks to a cut in rates, would not show as severe a slowdown as expected initially. This meant that car sales -- platinum and palladium are used as car exhaust catalysts -- would slow down less than presumed, while jewellery sales (about 50% of platinum is used in jewellery) also would be affected less than initially thought. It was not only the platinum sector that was running ahead thanks to the higher prices. The resources index managed to gain 314 points or 5% to 6502, buoyed by the interest rate cuts in the US overnight and the climbing platinum index, which gained 910 points to end at 25472.
On the broader resources side, Anglo American's share price gained R31,60 to R443,60 and De Beers rose R13,80 to R210,40. This was despite figures from jewellery retailer Tiffany overnight showing flat retail numbers for the December holiday period, although comparable numbers were difficult to assess because of the millennium rush at the end of last year Tiffany said. Tiffany reported an overall increase of 2% for the period from November 1 to December 31, up from $474m to $482,5m. US retail sales fell 1%, with comparable store sales down 3%, following a 27% rise last year due to millennium madness.
Black Blade: Russian deliveries of Palladium were to begin the first week of January. Guess what?
Black Blade said:
"The major gold hedge fund producers in this example, do not provide much value if any to the shareholders. The question is why do some producers continue to hedge and depress the price of gold? It would appear that they are too deep into debt and in the clutches of their banker overlords."
Hedging does provide cash flow, which may be essential to keep the mine open and the bills paid. Obviously, this cannot go on forever, selling anticipated production increasingly, on and on, out into the future.
http://www.msnbc.com/msn/511867.asp Roads, logging, oil drilling to be banned on 58.5 million acres. Clinton is still searching for a legacy, other than the legacy of leachery. A fight in Congress is ensured, and lawsuits are going to be inevitable.
Mr. Canuck, I also saw Larry Kudlow explain on CNBC that there is no inflation and proof of this is that POG has not moved higher. At least he confirms that POG should move higher if there is inflation. My first thought was, like yours, to report this to the Stranger.
LeSin (45091), thanks for reporting Cage Rattler's thoughts on the Yen. I believe he used to post here and identified himself once as a currency trader. I've read other opinions that the Japanese currency may weaken.
A reporter on CNBC reported this morning that the Fed. does get the important numbers (like the unemployment number this morning) but only one day early. His sources, he said, were those who used to have access to the Fed. meetings. If this is still true, then the unemployment number was still unknown on Wed. when the Fed. lowered rates. Whether true or not, the employment number doesn't strike me as being noteworthy enough to cause Fed. concern. Is ORO's "Dead Body" (44964) yet to reveal itself??
Is the market euphoria over lower interest rates all spent now? Will the Dow, Duck and S+P find the line of least resistence is down. I shorted the S+P by buying a Put overnight on the globex thinking that something is still out there that caused enough fear to cause the rate lowering between meetings. I hope the stench from the "Dead Body" reveals itself soon. This is, of course, not investment advice. My investment decisions are however often humorous. Feel free to laugh.
Rich
Unfortunately, forward sales only hurt the gold industry as a whole by flooding the market with gold, albeit leased physical gold (actually sold) and paper gold. This in effect drives the POG down as it is interpreted by the market as a huge supply of gold will soon appear in the market (the so-called "over-hang"). These forward sales and leasing programs have helped to bring the gold market to where it is today. Although I don't mind the bargain basement prices as I am accumulating both physical and shares of extremely profitable unhedged gold miners. But I call a spade a spade.
DOW �214 and DUCK �90! This is interesting. Givin it all back I see! So much for rate cuts, soft landings, and stimulating the market. Don't walk on the sidewalks as those brokers splatter when they hit pavement!
The use of hedging could be a beneficial tool if used in a prudent manner, just like a credit card for a consumer. Agreed, it has long since passed that stage and is now a recipe for disaster...
-snip-
"Prices are determined by real and monetary factors. Consequently it can occur that if the real factors are pulling things in an opposite direction to monetary factors, there may be no visible change in prices. While money growth is buoyant, prices may not increase. The crux therefore, is not rises in the CPI, or relative increases in money supply versus rises in goods, but the fact that money supply is rising. It is this increase in money that matters, for it is this increase that sets in motion an exchange of nothing for something."
-snip-
This is one of those situations. The money supply is rising, and the dollar price of gold is not. To take advantage of the situation, I will exchange some FRN nothings for some physical somethings!!!
RE: RossL - This can be fun! The gold world's version of "Survivor"
The problem of hedging over the last 4 to 5 years is that once the prices have been beaten down, there is little benefit to hedging. Eventually the spot price and futures prices converge to a point where there is no net benefit. Most hedged mining companies are working off hedged positions from years ago; however, any new hedges (forward sales) are not likely to yield much. With an explosive rise in the price of gold, many hedged miners will have the same unpleasant experiences as Ashanti Gold and Cambior. The next few months could get very interesting indeed. We will have to see who survives the shakeout. Cheers!
NEW YORK (CBS.MW) - Stocks retreated across the board Friday as investors processed an employment report that revealed slowing job growth and pondered another slew of profit warnings. Weakness was widespread in the hardware, software, Internet, retail, financial, biotech and chemical sectors with only natural gas, gold, drug and oil service issues showing some signs of strength.
Black Blade: Looks like the "Working Groups on Financial Markets" aka PPT have stepped in as market indices are recovering. It doesn't take much now to rile the markets does it?
Bank Of America Dn 8% On Talk Of More Credit Problems
Updated: Friday, January 5, 2001 10:36 AM ET
By Tara Siegel
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Bank of America Corp. (BAC, news, msgs) said it has not experienced any significant losses in derivatives or other trading activities, putting the rumors that pervaded the market earlier to rest. "We know of no basis to support speculative rumors about our operations," said a Bank of America spokesman. "We are conducting business as usual." He also said the company remains comfortable with its guidance for credit quality in 2001 as provided to investors last month. Trading was halted on Bank of America's stock and has not yet resumed.
http://biz.yahoo.com/rb/010105/bj.html NEW YORK (Reuters) - Stocks fell in early morning trading on Friday, led by financial shares, as investors worried that the surprise interest-rate cuts by the U.S. Federal Reserve may signal distress in the banking system. Meanwhile, monthly jobs numbers that added to more signs of an economic slowdown before the opening, just two days after the Fed lowered key interest rates in a move that sparked an explosive rally in stocks. ``It's hard to make the case that an interest rate cut is to the solution to all problems, it should help consumer sentiment somewhat,'' said Bill Meehan, chief market analyst at Cantor Fitzgerald & Co. ``Right now the concerns are what kind of economy are we looking at, how long will it take for the Fed rate cuts to have an impact.
Black Blade: That's more than enough fun for me today, I see some ducks down by the creek. I gotta go Whack some Ducks! Only 2 more weeks left in the season.
I did a little calculation regarding the confluence of a couple of dead bodies recently departed, and the walking dead of the California energy markets and their creditors.
Cal governor Davis had met with Greenspan a day or two before the Fed's panic easing. Davis was probably told to raise rates or face responsibility for a credit market debacle as they file for bankruptcy just when Wards, LTV steel and Benderly (sp?) went belly up and Xerox is facing a cash crunch in recycling its debt and has exhausted its bank credit lines.
The Wards and LTV deaths are going to create a $3 billion (Ward's depends on how much they raise in their going out of business sale) hole in banking, but Xerox and the Cal utils are on the order of $8 billion EACH.
The two zombies needed to have their credit costs cut, and their bank creditors needed to lower their cost of funds. Furthermore, construction borrowing has fallen as short term construction loans have risen by 1/3 while labor costs continued upwards by 10% by my reckoning, thus eliminating the "Spec" construction, now 40% more expensive to hold. This factor and the new competition at the low end of the car market from Korean makers (lowering the dollar value of car sales and loans and shifting them away from US makers) has caused a drop in the overall volume of sales and loan originations for short term lending by banks. That meant that it was possible to have up to $20 billion in defaults coming due this quarter, with no prospect of short term money being created quickly enough to replace it.
At 5% capital adequacy, a $20 billion loss would require an additional $400 billion credit expansion to replace the lost capital, on top of that needed to cover losses of junk debt, which has put some leeraged LTCM style players in danger. This figure was way outside the realm of the possible at current rates, even with Treasury buybacks and Fed monetary injections at near record levels.
Davis must have cut a deal with Greenspan that would bring credit costs down, while Davis would act to increase the util's revenue.
That is the most probable panic cause, otherwise the rate would have been lowered following an ordinary meeting.
http://www.minesite.com/brokers.htmThey state that "almost all gold equity prices should improve dramaticly."
It is nice to hear words of encouragement but, what about all of those hedge books out there?
"LONDON, Jan 5 (Reuters) - A second unexpected rate cut by the U.S. Federal Reserve in as many days was welcomed by European analysts and investors on Friday, but some cautioned the move could indicate distress in the banking system."
"...underscored growing concern about credit woes among major U.S. lenders.
``The discount rate is technical but it may suggest that there is some financial distress,'' said Bill O'Neill global strategist at HSBC Investment Bank in London.
``There has been talk that (the Fed) know of a particular bank in distress.''
``Banks don't often do it because they can borrow elsewhere more cheaply,'' said Paul Horne of Schroder Salomon Smith Barney in London.
``If they use it it is a signal to the Fed that banks are having difficulty and may be having trouble on the open market.''
``There has been concern because the Fed has acted so precipitously and indeed without precedent. It will get the market worried that there is some kind of specific problem out there that the market doesn't know about.''
"Most U.S. banks have had to set aside chests of money to protect against commercial loan defaults, analysts said."
``The Fed is the borrower of last resort and it could well be the case that they are trying to improve liquidity conditions for U.S. banks,'' said Matt Wickens, global economist at ABN Amro in London.
-------------
The Bank of America is said to have missed fourth-qauarter earnings projections due in part from $1.2 billion in bad loans.
Where do you run to protect your wealth (or should I say buying power) currently represented as currency when you know the Fed will do whatever liquidation (inflating) necessary to prevent a domino effect among a strapped banking system? You run to gold, of course. Call Centennial today and let them help you chart a safe course. Life may be hard without an "economics owners manual"; gold makes it just a bit easier.
The Fed adds $5.5 billion to banking reserves today
Using over-the-weekend repurchase agreements with the standard spectrum of collateral, the Fed has helped to temporarily boost banking system reserves by five and a half billion dollars.
Fed funds were trading at 5-7/8ths percent, which is below the target rate. Almost makes one wonder how many of the demand-side borrowers are opting for the Fed's direct discount window (and with it the better rate) instead...
Black Blade # 45078 Hedging Scams and RossL # 45099...Excellent Posts...
<>
I have thought long and hard about this for a long time now and this is what I come up with:
Everyone knows shareholders are the true owners of companies and management is supposed to do what the holder of the "MAJORITY" of shares vote to have done concerning company policy. Well I follow many of the Gold mining companies reports and releases and South African Gold mines used to release the top ten owners by shares of the mining company. The top 8 to 10 shareholders are always some type of bank or financial institution.(I've had trouble getting that information recently)
Now, I submit, controlling interest in "Hedged" Gold mines is made up of the same group that has controlling interest in the "Bullion Banks" that offer the miners cash or the equivalent for unmined Gold,hedges.(Future Gold Production)
Therefore the real "Majority" owners of the mines are and have been making much more profit dealing in the hedging business of Gold than the actual sale of the product produced.(GOLD) Management of these mines are told to hedge.
This seems to answer the question for me, "Why do some producers continue to hedge?"
On Ashanti...Thoughts Only...Some of the "Minority" shareholders have started a legal action against the company.I don't think any share holders want to stop current and future Gold production, however if current Gold production is stopped for a period of time the existing and future hedges may become almost worthless(Read go down in percieved value) as no Gold is being delivered at all or at the time specified,to be delivered. If that scenario ""Did"" happen in the not to distant future wouldn't holders of those hedging(paper contracts) try to sell(dump)them at any price and couldn't that action "Depress" the spot price of Gold irregardless of whats happening in the other financial markets?
Thanks for Reading...beesting.
The Boyz have survived another week of extremely short gold positions. Maybe they actually THRIVED this week by selling "fools gold" to some fool, knowing full well their shorts will be bailed later as per the "free money" theories taught at this establishment. Regardless, the vigil continues. Can they succeed in causing a panic low from here? We're certainly properly set up for it. MK, you probably should install a few more phone lines to handle all the orders that would come with $205 "fools gold" pricing. I am ready! Can I put in a pre-order in case the spike down is short lived, as it surely will be? Will you have enough to go around? Will a divergence of price between "fools gold" and physical crop up and spoil our insightful plans? Who can predict this dollar price of the divergence point accurately? Any guesses?
Waiting patiently. Got enough physical, got GATA???
This dead fish has officially become VERY VERY smelly to my nose. It became VERY smelly at the unseemly haste of the passage of the HR4541(?), the derivatives bill cooperated on by all political parties at a during the pre election fever, when no trick is on the opposition is to lowly to contemplate.
Hoo boy, anyone that does not read the writing on the wall, can't read. The BIG question is, will teflon Bill survive the next 16 days unscathed?
I think we should start a contest. Best one liners by the condemned facing the firing squad. A little Gallows humor. Winner to enter the CLEHOF. Any takers?
Hall of Fame...good for weekend reading...now includes latest nomination of commmentary by Holtzman
http://www.usagold.com/halloffame.htmlThis special archive really does a fantastic service to encapsulate the intricacies of the gold market and philosophies behind personal gold ownership.
On another note...a plea to I.V. Holtzman: over the months I have derived considerable personal satisfaction reading your contributions. The exceptional even-handed treatment of your subject matter continues to strike me as nothing short of profound. Do you happen to have a list of your prior commentaries, and if so, would it be at all convenient for you provide it to me? I am otherwise daunted by the notion of prospecting the vast wealth of the archives to unearth your collective text. I should like to have an index of them, and perhaps make it similarly available for the benefit of new and future visitors.
In the early days you had e-mailed your commentaries to Michael to be posted on your behalf. Given his busy schedule and the e-mail traffic he receives, I can imagine that in his priority to attend to the business side of things it is possible that a commentary intended for the forum did not make it there. If so, and if you still have the text not rendered obsolete by the passage of time, I would be eager to receive it for proper inclusion in this index. Again, I request this only if it is quite convenient for you, sir.
20 yrs ago, when South Africa, dominated the gold-production...hedging wasn't even considered. They did not have the difficulty to impose discipline. The only pirate was Russia.
I thingk that hedging accelerated, when CB's, started the sell signal. Strong and Rich mines had their specific reasons to hedge and weak and poor mines, had other reasons.
Running a big mine-complex is not the same as running a candy-shop. You can't close a mine in full progress. Once you have taken the descission to develop the mine, you are at the mercy of POG. But things got out of hand. Who could or still can answer the question : for how long is POG going to remain weak ? Goldmines have relied to long on the advanced techniques to mine and extract gold from the different ores. In their panic of CB's gold selling, they took the hedging-silver-plate as an opportunity to survive or expand and fight for supremacy. You and I would have reacted the same way.
But, once you started taking the hedge - drug, it is very difficult to re-adjust. Especially for the weak and poor mines. As a shareholder, I would choose for a care and maintainance strategy. But, then you give the others the opportunity to profit on an increasing POG. So, a cartel formation seemed and still seems to be impossible. It is the same circus seen at OPEC for many years. How many shareholders have the courage to consider their mine as an inactive-underground-gold-holding ? They want dividends and growth. Employees can't be put aside with a fingerclip.
Management can't go, unpaid, on a long vacation, whilst POG is adjusting to offer/demand. and the gold-producers are still ignoring GATA, openly.
As I said before : big - strong - rich miners, never panicked or showed any signs of panic. They found different ways to survive and kept on mining. And they are not going to explain us, their reasons for the choosen strategies.
Post factum, we are experiencing the effects on POG. But in the future, the hedge-choice, will work for POG as a later catalyst. An increasing POG will have a negative effect on jewelry-consumption. The production will be in a simultane declining phase and offer/demand will balance positively.
A few years from now...hedging will be remembered as a bad dream. It also took quite a long time, before OPEC, was ably to discipline itself. Gold producers will have learned their lesson. At 270$, time, is Gold's best friend.
The longer it takes...the costlier the lesson.
After all...it is the wrong hedging choice that contributes to the opportunity of physical gold buyers to acquire the metal at rock-bottom prices. A once in a lifetime opportunity.
Sorry to repeat my wish of a POG collapse to under 200$.
Such an event, would be a true eye-opener. It would be the short-pain-trigger, to act upon the fact. Gold producers would go bancrupt and Goldsellers would decide to stop selling and massive gold accumulation would start immediately. Now, I have the impression we are sitting in between two chairs. Not high enough to live and not low enough to die. Cruel, isn't it ?
POG-pattern from 2/96 - 414$ decline is a five (5) Wave affair. Best to be seen on a P&F chart. We are still in the last Wave V (five) down. The 253$ low on 9/99 was the end of Wave III (down)and the WAG spike was Wave IV (up).
We can discard this scenario, when 350$ has been breached without any doubt. I hate to say it...but...as long as 350$ hasn't been broken...we are still down-trending. This is a very good reason to put all emotions on the shelf for the time being. This scenario does not exclude an unexpected and explosive turnaround. NIA !!!
"Lower currency flows can also be attributed to 'an unprecedented convergence of global interest rates' in the past five years, wrote Mr Leven. The narrowing differential on yields dampened demand for 'carry trades', where investors borrow money at a low interest rate and deposit it in countries with higher returns, he said.
+
Lehman expects trading volume to pick up again this year, as the bank forecasts the US dollar will decline against the euro and yen."
��Money is accepted in exchange for
wealth until wealth expropriation
consumes most of production and the
public begins to starve. Easy credit
made possible by credit creation $3000+
gold along with the lower interest rates guarantee future correction. Money
creation is a check written without a
bank balance (deposit) or collateral.
What is stoping the central bank from
using the credit creation gold priced at $3000+ over and over. Much of the US
private sector debt is collateralised by equity and real estate holdings. Today
the main economic function of money is
expropriation of wealth. Asset
valuations can only be driven higher at
the expense of the real economy.
Inflation can not be controlled. We the
people have been fooled into believing
gold price is $270 when trade settlement trade gold goes for $526 and credit
creation gold goes for $3,000 and that
same gold is used over and over at least 10 times. I dare anyone on this forum
ask 1-At what price does credit creation gold change hands? 2-At what gold price
does the USA settle its trade deficit?
Retaining the god-given right to
distribute one's own wealth is the only
guarantee of freedom from tyranny and we do not even have the right to sell gold
at its true value. Money accepted as a
medium of echange subjects people to the influence of its creator. It is hard to
believe that the FED and the Bullion
Dealers have been and are trading with
wealth in under-ground free markets. Nobody has the guts to
ask the real questions and demand a real answere. I tried but found it dangerous
to my physical and financial health. I
am just a dumb farmer and I wish some of you smart people get answeres to 1+2
above. In our so called free markets
there are many losers and few winners.
The money that the many losers lost went to the few. It did't vanish; it changed
owners. Most of us on this earth are on
this earth to be financially wiped out
by the few and we just can't seem to get wiped out enough.
ECB board member Tommaso Padoa-Schioppa sees good year ahead for euro
http://biz.yahoo.com/rf/010105/l05252766.htmlIn an interview on Italian state television, P-S said telling in the wake of the U.S. rate cut, "Today in Europe there is a great European currency. Our moves are not towed along by U.S. moves but are based on European economic conditions."
In case you haven't noticed, many things are not as before. Act now to position yourself accordingly.
I can't remember who said it, maybe Alan Greenspan, or more likely Bill Clinton, but one of the more famous quotes of the day was "I will return, reincarnated, to rescue the country from this mess caused by the Bush crowd. The good times will roll again".
Thanks for the response, it brings up a lot of points for further discussion.
It's my opinion the jewelry business here in the U.S. is not affected very much by the spot POG simply because there is a huge mark up in jewelry anyway, most is 10,12,14 & 18 carat, according to my wife. That may be much different in India, Thailand,UAE, and other locations where jewelry is closer to 24 carat.
Lets look at POG @ 200 per ounce from a producers viewpoint.
If a producer of anything spends more to produce his/her finished product than they can sell or trade for it, how long will they continue to produce?
Answer...not very long!
There are a lot of factors slowly coming into play right now, one of them is; Euroland is valuing 15% of their digital currency(Gold) at market prices. It would not be in their best interests (they are trying keep a strong currency) if the POG went to $200 per ounce.
I look for the POG to be priced in Euro's and dollars very soon.
Currently POG in Euro's is around $280+ per ounce. Our old friend ANOTHER said long ago this($280) was a significant number for POG in U.S.dollars, it may also be in Euro's.($280 per ounce Gold = about $9.00 per gram or close to $9,000,000 per metric tonne,1000 kilograms)
One other misconception I think people may have is, if POG starts to climb buyers may disappear, I believe quite the contrary, buyers will slowly come out of the woodwork as the POG rises. That's what happened in the middle 1970's in jumps and hops till 1980's when the $850 spike happened. At $850 per ounce Gold some were BUYING!
Well enough said for now...We watch Together....beesting.
http://home.columbus.rr.com/rossl/gold.htm Drastic measures by the US fed do not even show up on this chart. I will be looking for derivatives to be making their mark soon.
I watched CNBC for most of the day today (had the day off) and was both alarmed and in awe with the blatant and treacherous financial coverage it had to offer.
I began to watch at about 9:00 (eastern), just to get into the 'swing' before the markets opened. Larry Kudlow made the boneheaded spiel about inflation shortly after 9:00 (inflation is not rising because gold is not rising?), Maria did her 'on the floor' freak out show at 9:20 and then hell broke loose shortly after 9:30. Bank of America did not open and red alert warnings came out that there was rumours of 'derivative' problems. The CNBC desk was set afire with speculations and theories. For a full 20 minutes, until near 10:00 they were falling over each other with reasoning why the stock never opened. The PANIC was on the CNBC newsdesk. The anchor dude (sorry, I don't recall his name) made the statement, to the effect of, " the public deserves to know the possibilites, and one possibility is that the Bank of America may be in trouble, it may be derivative exposure that has gone bad on them."
The desk hushed and they stammered and stumped for several minutes until the BAC announcement. Then they cut back to the floor and Maria did her hyperbole freak show routine that BAC had made the announcement that everything was okay in 'derivative land', the stock was set to open any moment and it was going to open only a couple bucks down.
Sure enough, BAC opened soon after, an hour late I might add, the DOW briefly retraced and the 'pundits' gathered themselves and everything was okay in 'goldilocks' land.
HOWEVER, this is what I saw. For a couple fleeting minutes, maybe from 10:00 or so, there was horror at the desk. There was a genuine concern, a feeling that all hell was going to break out, a major sell-off. There was, for a minute or two a feeling of PANIC on the astute CNBC. It was there, crystal clear.
These clowns know what is going to happen. They are 'actors'
playing the bull game and now even the actors know the outcome. They know 'meltdown' is so very, very close. Mr. Greenspan's PANIC rate cut this week is being scutinized over and over this week and no one is able to justify his rash, abrupt decision other than he HAD to, he is on emergency damage control. The 'January effect' was clear and evident from Tuesday 9:30 until noon Wednesday, freefall was in the cards. He didn't want to prematurely cut rates but after a day and a half of mayhem he had no choice.
CNBCI was watching CNBC on and off today. You are correct about a look of panic.
I think I will pick up a tape for the VCR and tape CNBC this next week. It could be historic. Plus if gold decides to do a moon shot I want to have the Larry Kudlow reaction on tape.
To Silvercollector - -gold manipulation I found out from somebody that works at the Bank of England that credit creation gold price is $3000+ and from BIS that USA trade deficit settlement price is over $500. The low commodity gold price is being used to take gold out of circulation and then used for credit creation to feed the stock market and real estate boom. The boom and bust cycle is made possible by using gold for credit creation to create credit until everything is mortgaged to the hilt and then forclosed on. This has been going on ever since the discovery of paper money. I wrote to many elected officials and asked what 1- what price does credit creation gold change hands and 2- what price gold is the USA trade deficit settled at BIS? I must be on to something because my place was searched and my webtv unit disabled. Some of the elected officials are asking questions and getting different information. Many of these elected officials have heard of the ESF but have no idea what it does. Ever since I posted this on GE I have been unable to post again. You should see some of the response I get from the elected officials- they must be in on it for many of these officials like Hillary Clinton, Jon Corizone (SP) are making millions on this scam. I have mailed every month for the last 5 months to over 40 elected officials and some of them are seeing what I see. I got a letter today that said that "money is credit-imaginary demand-inflation-seigniorage. He stated that to get elected you have to be in on it in order to raise funds to run. Most elected officials make at least $50,000 per speech at the commodity exchange which are shown as profits made on betting on a lower gold price. I hope more people will ask the same two questions. Our future freedom is at stake. We the people are to blind to ask the obvious.. There is no transparancy to the gold market.
``It's a loud and clear message that there's not going to be a recession,'' said Stephen Slifer, chief economist at Lehman Brothers in New York. ``The Fed stands ready to do whatever's necessary to make sure nothing bad happens."
And I thought that that's what sleeping with a nite light on was supposed to do. (I wonder if they have a brand with Alan G's face on them? Hey, isn't Mr. Rogers' job open now? Kids, wouldn't you like Mr. Greenspin's neighborhood on your TV?)
Mr. Rogers' job Mr. Greenspin my have some competition for Mr.Rogers job . I heard last week there was talk of Billy Clinton getting a TV show.
Then again CNBC may have a large time slot opening up in the next few weeks! They can both have TV shows if they play their cards right!
LOL
Hello...Glad to see you've pulled up a chair at this table....
Marcia told some of our old GE crowd of your being harrassed
and I'm very glad to see you are not being intimidated or silenced....You've awoken more than a few thinkers w/ your posts and links over the last couple years....Looking forward to more of the same...YGMView
Yesterday's Discussion.
Friday January 5 7:30 PM ET
Black Lawmakers to Challenge U.S. Electoral Vote
By Thomas Ferraro
WASHINGTON (Reuters) - The Congressional Black Caucus (news - web sites)
announced on Friday it will challenge final certification of Republican
George W. Bush (news - web sites) as the next president, but a spokesman
admitted they might well fail.
The challenge will made on Saturday during a joint session of Congress
chaired by Vice President Al Gore (news - web sites), who conceded defeat to
Bush last month in the contested Nov. 7 presidential election.
I saw a great TV commercial the other day on the Outdoor Channel . It was a spoof of the add where the two brothers are separated at birth and one is brought up reading fishing magazines and the other The Wall Street paper. Well in this version the outdoor channel was added in place of the fishing magazines. The end had a new twist too, the boy who watched the Outdoor Channel won millions of dollars in the Bass Master Classic. His brother lost it all when his new IPO went belly up. They show him sleeping on a park bench under his Wall Street paper.
Its a hoot.
I guess I should put it up top: This is the way I see the FOA gold rocket-price scenario happening. Combination of Fed "printing", public "flocking" and "fleeing", and ECB "re-balancing" reserves. It's hard to see $30,000, no matter how much of the above occurs; hard to see that something else wouldn't siphon off those $ somewhere on the way to that, but none of us really NEED that number just now except as an attention-getter, right? Somewhere around $1000 or $2000 (very explainable) we'd be getting "the rest of the story" from FOA & ANOTHER, and making our judgments from there.
AG and Payments System: Squeeze is On
In the interviews with Greider and others for their books on the Fed, Greenspan and Volcker have emphasized that their concern has been with preventing a breakdown in the payments system between financial institutions (US & worldwide). They couldn't guarantee which way markets would go, but they wanted to be sure that the winners and losers could settle their deals quickly and finally in USD, and move on to more commerce.
The Fed acts to stand behind institutions with the required capital levels so that they are not driven over the brink by interruption of payments from less-solvent counterparties. In one instance during Volcker's reign, the breakdown ("Herstatt Risk" from an early-70s European crisis) was somewhat threatened by the different clearing times between US and European banks. I think one system had three-day, the other five-day clearance, and that difference would have left some banks gasping for liquidity for a fatal 48 hours. The Fed and other CBs had to tide over that difference during a cash flow crunch.
Many of AG's speeches have been about technical improvements in the payments system, so that a glitch seemingly far-removed from the basic business solvency of the transacting institutions (which are playing brinkmanship enough as it is) does not bring down the system. "Cascading cross-defaults" I think was his phrase.
We get a whiff of that anytime a major bank or other institution is threatened with capital insolvency. The memory of Continental Bank, which was cleaned out by foreign overnight wired withdrawals nearly 20 years ago, must still be in the minds of some today.
Picture the money supply as somewhat concentric rings of asset types, perhaps akin to Dante's rings of Hades?, or the electron rings of a highly agitated atomic particle. At the outermost levels are the "flakiest" of funny moneys, but they exist because people can play with them in certain ways they can't with the more stable moneys toward the center. (Can you Goldhearts guess what these might be?) The players are willing to accept higher risk to attain their ends of greed and excitement, though their risk/reward calculations have been actually been lousy if done at all and their information inputs inadequate.
They analyze their transactions on a two-dimensional map of risk/reward considering only market directions and maybe the psychology of counterplayers. They do not question the third dimension which, from an elevated perspective, says that the chessboard they are now winning upon can at any moment be swept clear by the hand of market breakdown and payments system collapse.
The US money supply today might be, for example, $7 trillion of all types (honest, I haven't looked this up, and don't care to research harder toward some useless specificity.) But this money supply represents debt of all types that people and institutions have committed themselves to work toward repaying, circumstances permitting. (Subject to many ways of discounting in future.) It represents paper currency that people commonly accept as money. And it represents real assets that can be used as money, or act as direct backing for a currency money.
Suppose that those categories boil down, in an economic "hard landing" scenario, to only $2 trillion of "hard" money. Money that really will be trusted in use, debt that will be worked down to sustain homes, businesses, and credit ratings. Right now, the public is looking toward the $7 trillion "mountain" of money that they've always known (and still remember from its smaller and less-flaky days). Right now, they believe that by working harder and smarter, a piece of that big mountain is to be theirs. A shift in psychology later, they turn around and see instead the smaller "hill" of $2 trillion. And, voila!, THAT becomes the real money supply, either very immediately, or eventually, after a longer and still-painful workout.
If that is what people believe is out there, then that is what they are willing to supply their labor and capital to work toward. That is THE Money Supply.
Alan Greenspan's problem with the Bubble is that its puncture immediately puts the smaller amount on peoples' credulity screen. All the funny money in various way-out orbits -- whether created by flicks of the fickle Fed fingers, or by a lifetime of self-denying savings -- flees toward the stable center when it is threatened, but like the crowded theatre on fire, the doorways are not wide enough. The available niches for more stable money in closer levels are fewer and cannot readily accommodate the flood of scared money. Much money, both borrowed and saved, departs for Money Heaven (where streets are paved with fiat.) Of course, back on Money Earth, prices rise for items representing the more stable money items.
In market Technical Analysis terminology, there is not much "Support" between $7 trillion and $2 trillion. Most "buyers" of money ("suppliers" of labor) will sit out the market slide as able, once their expectations shift, and they will thereby produce a bottoming out of the supply/demand equilibrium at a new low, but supportable, level. They will not bid their hard labors for the outer, flaky (mostly departed or soon to) moneys anymore but for the nearer to hand, harder, trusted moneys. Newly risk-averse, the cycle will funnel more of the remaining $2 trillion toward gold and assets near its central orbit of stability.
Of course, economic activity, statistically-measured, slows to a crawl as people re-jigger their ideas of what is worthwhile spending their now poorly-paid labor and dwindling cash upon. The Depression scenario, scary as it may be, may cause many people to repeat what was said in an earlier time: "We had everything in those days, except money." Learning about values never ceases; money is just the warm-up.
The payments system is the artery through which trillions of dollars flow daily or weekly, and upon the constriction of those vessels, the economic "lifeblood" flowing will reduce to the lowest practical and supportable amount. Institutions will simply not hang out their entire corporate capital on a transaction or two, when a new "Creditanstalt" or "Herstatt" has occurred and more are waiting to happen, unknown which ones among all their routine transactions. This is how the payments system dies, regardless of Fed and CB backing. Even the Lone Ranger can fit only six Silver Bullets in his pistol.
Greenspan simply does not want the statistical implosion of the money supply to happen on his watch. He does not consider it inevitable, and believes that the Art of Fed Chairmanship, aided by public psychology, has a spitting chance of turning it back, or landing it "softly". If he fails, his consolation prize would be history granting that he "did his best, in an impossible situation," quite a re-write in itself. (If the camera is focused only upon the post-Crash period, though, he may get away with it. Awww, let him.)
But, as he has pushed back each harbinger or lesser trigger of that implosion, he has aligned all of the disparate elements in a grand conjunction, a parting of the economic Red Sea (in which his own chariots must perish), and the almost meticulously calculated as-if-planned Perfect Storm that will fall upon the economy with full fury and spare no frivolous item of economic waste from dissolution.
I believe you give Mr. AG too much credibility. Your analogy of the atom or every increasing circles within circles is apropos in so far as the undulations of the volatility that are growing larger by the day, it seems, don't start to throw these outer-orbits out of orbit. And that is the risk here. How do you control an economy that you don't have control over? Hasn't he admitted that the money supply is now created outside of his area of responsibility? Fanny Mae, Freddy Mac, money market funds, etc?
We have a case of too many people controlling money or not controlling it, as the case actually would appear.
I can't help but think these wildly gyrating days of volatility aren't merely a nasty indicator that the system is vibrating out of control. My friend Roger is a PH.D. in vibrational mechanics. He says that vibration is the main enemy to anything mechanical. He says anything will eventually break if you shake it too hard. Well, Roger may have been prophetizing about money too. If we shake this economy too hard, she will break also. These wide swings of stock prices and dollar-euro exchange rates appear to be held in orbit only by keeping the price of gold and other commodities low. That there is such a concerted effort to do this with California natural gas, gold, silver and who knows what else tells me that the fear of inflation is so high that those who control or can control commodities justify commodity suppression to save the system from inflation.
In the meantime, we have all the volatility on the markets and forex that shows the system is starting to break up in flight because of the financial vibration. The gravity of your US dollar proton holding these financial electrons is only as strong as the commodities backing currency make it. Since the commodities appear to be kept from playing their stabilizing role of letting currency rise or fall to their proper value, we are waging this battle in the one commodity (oil and natural gas) and few markets stocks and bonds) that keeps this battle of inflation in check for now; but soon, this will change because of financial vibration breaking apart your monetary electrons, starting with those in outer orbits.
Sooner than later it seems now, gold, silver, natural gas, oil will all have to be allowed to rise in US dollar terms in order to keep the system in homeostasis. These vibrating forces of destruction will not get any better until a dampening effect is applied and that is the natural supply v demand of goods and money. As long as we have folks who can control the commodities downwards, inflation seems in check. It is now starting to get out of their control. Or so it seems.
www.kitco.comDate: Sat Jan 06 2001 00:49
Goldfish (A good one from GE .........) ID#433282:
Copyright � 2000 Goldfish/Kitco Inc. All rights reserved
( All ) International Economist urges Greenspan to let gold price rise for the wrong reasons!
( Deadeye ) Jan 05, 22:37
From National Review:
http://www.nationalreview.com/comment/
commentprint010401d.html
Rate cuts alone will not solve deflation problem. In fact, they may make it worse. Under its current operating procedures the Fed can only add enough dollar liquidity to hold its federal-funds rate target in place. But what if the banks expect the Fed to continue lowering rates? If they bid for fewer reserves on the expectation that the price of credit will continue to fall, it could force the Fed's open-market desk in New York to actually reduce the base money supply to keep the funds target from falling further.
This is precisely what occurred in Japan between 1990 and 1998. The Bank of Japan ( BoJ ) cut its interest-rate target in small steps from 9% down to zero, but the market was one step ahead of the Keynesian economists at the BoJ. When bidding activity stalled, the BoJ was forced to reduce the monetary base even as rates came down. The yen/gold price continued its downward march, pulling the rest of the price structure down with it. Errors in tax policy exacerbated the situation, which continues unabated to this day.
The best we can hope for in the current environment is that Greenspan shelves his Phillips Curves and hybrid Keynesianism and adds enough liquidity to get the price of gold - the commodity of the highest monetary order - up above $300/oz. If he could do that, financial markets would stage an extended relief rally, celebrating the end of Greenspan's deflationary squeeze on liquidity. Unfortunately, Greenspan seems to have forgotten about gold's ability to foreshadow price-level changes, which places the burden of relief on fiscal policy.
http://www.nationalreview.com/comment/commentprint010401d.htmlWe have economists who rely on a low price of gold to explain deflation v inflation. Is there any predictive value in basing one's prediction on the price of gold being low as the reason for current conditions and taking or making decisions of an economic nature that rely upon that premise as to gold being low? What if the premise for gold being low is the opposite of why one believes it to be low? Wouldn't that make any decisions based on it being low for one reason be completely wrong and lead to the opposite desired result?
If those in the know, know that gold is low because the ESF makes it so, yet others (see link above) believe it is low because they believe natural market forces make it so, wouldn't these differing parties make decisions completely different or cause them to offer advice that would be completely contradictory even though they were using the same fact or statitic?
I believe the answer is yes, it would make a big difference. That is why GATA is on to something, they just want a little bit of truth about gold told so that those who are at the helm of this big ship will make the right decisions about an economy in stress. If you have to make decisions the best ones, I would hope, would be made knowing the truth.
It seems that this truth-gap may be widening for Mr. AG, as we all believe he is in the know about this gold thing. But, the pundits on CNBC and CNN don't seem to understand gold nor why it is down and assume that gold is down because of natural supply and demand. They don't get that demand is so high for physical that all shackles are being broken down to free as much as possible without causing a rise in COMEX pricing.
In other words, if one is to use gold as a true monetary indicator, one must understand the difference between paper and physical gold and how they play off each other and understand that gold is the indicator they really want it to be, but others in the know, know this too and have taken measures to make sure that it gives the false signal. And there in lies the key with this whole mess. Disinformation extraordinaire!
Steve H: Pay no attention to that fellow behind the curtain!
Thanks, YGM.
Steve -- I've gone way beyond my night's capacity, so I won't open a window and re-read our two pieces. I've got windows open with: Noland, 2 Flecks, Tarpley on the Great D, Bearforum up through 8pm and another through 3a.m., ContraryInvestor, Longwaves, Bonner, McCulley at Pimco, couple others. (Anyone who wishes to phone in at this point to scream "GET A LIFE!" can dial 1-900-EAT-****)
Been a busy, exciting day.
It seems we both were exploring and your mechanical vibration analogy carried thoughts pretty well. I'll re-read in the AM. (Hey, it IS the AM!)
My analogies were flying fast and thick as well, but I was trying to get at the old question of "what is money", and what will it be under crisis dynamics? Like electrons jumping orbits under different excitations, money will flow en masse between levels of risk based on mass judgments, which, in a major crisis, will preclude saving much of the money from passing through the needle's eye of salvation.
I don't remember praising AG so much, but maybe it could sound like it. He IS the central character of the Bubble mythology, rightly or wrongly, and you know he knows where the Goldbugs' lost hearts are buried. Anyway, his "invincibility" is a proxy for the market's bullish faith and he'll be tarred and feathered with the same idiotic lack of understanding of his limits.
I don't think about him much, but this week it's been hard not to. Oh yeah, and he cost me $20,000 in leap puts in '98. GRRRRR... (Nothing personal, right? ;)
Thanks many times for the posts you bring over from Kitco. You know we couldn't take the time to scan for the best ones and your skill at selection relieves me from the sense of missing something over there.
I read his comments every week. He makes a lot of sense, and is often right on the ball with predictions, and observaions. Definitely worth following.
Always remember, any of you readers, that these writers can't stick their neck out too far (they have family besides their own necks to consider) They know the 'elite' are ruthless in what they are about and in the preservtion their position.
So try to see not only what they are telling you, but also what they are trying to tell you. (Getting the message?)
If you doubt it - read (Mr) Christian his words are 'bountyful') and profound. (No, I am not sorry about the pun)
NG Going Higher and Banks Quiver as Loans and Derivatives are Scrutinized
By Gloria Gonzalez, BridgeNews
New York--Jan. 5--NYMEX Feb Henry Hub natural gas futures ended up 29.5 cents at $9.261 per MMBtu, extending Thursday's strong rally with support from forecasts predicting cooler temperatures toward the end of next week and expectations for a further expansion of the year-to-year storage deficit next week. The market had a technical reversal Thursday after a two-day sell-off left the market oversold. The rally was also partly a delayed reaction to the latest American Gas Association storage report. Observers said the 209-bcf draw featured in Wednesday's report was bullish because it was larger than both the 1999 draw of 133 bcf and the five-year average draw of 135 bcf.
"I thought it was a very impressive performance," said analyst Jim Ritterbusch of Ritterbusch Associates. "Just a couple of days ago we were teasing $8.000 and now we're at $9 and a quarter." Fundamentally, the weather picture, which had been overwhelming negative this week because of predictions for warmer temperatures, may have helped the market rally because of a chance for cool weather toward the end of the next 10-day period. Another shot of cool air will pass through the eastern United States this weekend and early next week, according to Bridge Global Weather Services. The impact of the cooler weather will be much smaller than the intense cold air masses that moved across the region in recent weeks. Temperatures will turn a little cooler, however, and some snow will precede the coldest air late in the weekend. Western portions of the country will see a change toward cooler weather late next week. Meanwhile, low storage levels continue to underpin the market with early indications that the next storage report will feature a withdrawal larger than the 1999 draw of 111 bcf during the comparable period. "Traders are looking ahead to next week's AGA," Ritterbusch said. "Even with the moderate temperatures, I think we'll draw more than 110, but that could be the last expansion of the deficit." Several market observers noted that after next week, it would take significant colder than normal temperatures to surpass upcoming withdrawals of 195, 242 and 213 bcf, which should lead to a narrowing of the year-to-year storage gap.
OUTLOOK
Although National Weather Service continues to predict warm temperatures in the Midwest and Northeast, several private forecasters are calling for more cold in the latter half of next week. The possibility of cold weather at the tail end of some forecasts is forcing people to rethink their positions. This should lead to more strength early next week as some players will be afraid to be short ahead of any more cold weather, sources said. In the absence of more forecasts for warm weather, the market may be "poised for a test of contract highs," Ritterbusch said
UPCOMING:
--Feb futures expire Jan. 29; Feb options expire Jan. 26.
--American Gas Association storage data are released at 1400 ET Wednesday.
Black Blade: Going into situation critical? It's going to be a close call. Yet the Grasshoppers continue to suck up energy at a record pace regardless of the price. They regard energy as a right. They complain when the prices rise. Why? Once it is extracted from the "core-rate" it isn't inflationary! Just ask the boys and girls at CNBC ;-) The events in the Peoples Republik of Kalifornia should be a warning to the rest of the country. The rumors that affected the Bank of America (BAC) show just how fragile things are now. Remember LTCM? That is a preview of things to come as huge debts and derivatives positions come under pressure and eventually begin to collapse as one domino (bank) takes out the next domino, etc. As power companies find that they are unable to service loans and go tits up, the rest of the investment community will take notice. The shock to BAC was just a preview that shows just how vulnerable and unstable these dominoes are.
New York--Jan. 5--The front lines of the fight to save California's two biggest utilities shifted to the government Friday as a court dashed hopes it would cap soaring electricity prices that have left Pacific Gas & Electricity and Southern California Edison near bankruptcy. As credit-rating agencies warned that the companies are less and less likely to repay their debts, a federal appeals court denied Edison's request to force the Federal Energy Regulatory Commission (FERC) to let power generators charge no more than the cost of production in the wholesale electricity market. If the Washington court had ruled in the utilities' favor, they would have escaped from a financial vise that has cost them more than $9 billion in the last few months. Until late this week, the rates the utilities are allowed to charge customers were frozen at 1996 levels even though cold weather and a shortage of generating capacity have boosted wholesale power prices as much as 60-fold from last year's levels. On Thursday afternoon, the California Public Utilities Commission voted 5-0 to let the utilities raise rates by an average of 10% for 90 days. The utilities said the decision gave them crucial breathing space, but it falls far short of the 26% to 30% rate increases they say they need. Now, the companies, financial markets and the ratings agencies are waiting for either the state or the federal government to act. The Clinton administration has invited California Gov. Gray Davis and leaders of the troubled utilities to a meeting at the White House next week. "We feel that this is a serious enough situation that every party has to be willing to compromise and go the extra mile to find a way out," a senior administration official told the Washington Post. "We believe every effort should be made to bring the parties together in search of at least a temporary solution." The California legislature is also working on ways to fix the situation -- a goal the ratings agencies say is essential. When Standard & Poor's cut its rating on both companies from A, a solid investment grade, to BBB-, a whisker above junk-bond status, the agency admitted more downgrades could follow quickly. "Yet, Standard & Poor's has concluded that while lower ratings may soon result, they are premature at this juncture because the California legislature is in special session and is endeavoring to craft a timely solution to the financial crisis of the state's utilities," the agency said. "It is precisely the dire consequences of inaction that leads Standard & Poor's to conclude that there is a reasonable chance that action is forthcoming." If Standard & Poor's and Moody's, its largest rival, cut the ratings to junk-bond levels, the utilities would move even closer to bankruptcy. The power companies have promised their creditors to maintain investment-grade ratings. Violating those agreements would mean the utilities had technically defaulted on their loans, opening the way for the creditors to claim their assets. Both Bank of America and J.P. Morgan Chase & Co. each have about $500 million in credit exposure to the utilities, according to people familiar with the situation. Fears that the banks could lose the money pushed their share prices sharply lower on Friday, even though analysts said any defaults wouldn't hurt earnings much. California's legislature wants to make sure the utilities stay solvent. Gray called the legislature into a special session to concentrate on the crisis on Wednesday. The state may issue bonds to give the utilities enough money to repay the billions of dollars they have borrowed to buy power on the wholesale market, according to the Los Angeles Times. The utilities--and their customers--would repay the money over time. As a longer-term solution, the state could take steps that would give it more control of power generation within its borders. On Friday morning, Philip Angelides, the state's treasurer, proposed setting up a financing authority that would issue $10 billion worth of bonds to buy the 75% of California's power transmission systems that is now in private hands. Some of the money would also pay for new, state-owned power plants. Construction on those plants could begin immediately, giving California an advantage over private power companies still waiting for state permission to build their own plants. Those private generators are some of the same companies that have profited as wholesale power prices hit unprecedented levels. Any deal faces formidable barriers. Steve Fetter, a former utilities commissioner now working as an analyst at the rating agency Fitch, said a bond-issuance scheme would require two-thirds votes in both houses of the California legislature. In addition, it would probably face court challenges from the state's powerful consumer advocacy groups, he said. "Something has to be done in the next three weeks," Lori Woodland, Fitch's California utilities analyst, said via a conference call on Friday. The agency cut its ratings on both utilities' debt to junk-bond status from investment grade on Thursday. She argued that FERC should impose an absolute cap on California's
wholesale power prices. The agency has limited prices to $150 per megawatt hour, but utilities can charge more if they can prove the rates are justified. Wholesale prices have reached more than $1,500 per megawatt hour, compared with less than $30 last spring. On Thursday, James J. Hoecker, FERC's chairman, said he could support a temporary price cap to create a "time out" during negotiations for a broad solution to the crisis. Hoecker is expected to attend the White House meeting next week. Meanwhile, both utilities' stock remained weak. Shares in PG & E Corp., Pacific Gas and Electric's parent company, were up 25 cents at $12.25 late Friday. The stock has plunged from a high of $31.81 in the last year. Stock in Edison International, the owner of Southern California Edison, fell 43 cents to $10.31--roughly one-third of its high over the last year.
Black Blade: What more can I add here. This says it all. Collapse is immenent!
http://www.goldminingoutlook.com/I see that SJ Kaplan has sold his stake in gold companies a couple of days ago and bought Dot.Coms and Techs. This ought to be interesting. I guess that the phrase about not trying to "catch a falling knife" has no meaning here. I remember when he said to short ebay and Amazon.com during the most irrational time of the exuberant market. One would have been whip-sawed badly of course. Now I await to see how this new strategy fares. I think I'll hold my PM position, my share of petroleum, utes, and other now minor positions, all interspersed with fishing and hunting breaks. Let the games begin!
But people accept the U.S. dollar today in exchange for much less than they used to. Since 1933, the U.S. dollar has lost 92 percent of its domestic purchasing power..."
Banks, including the central banks and the IMF, too hold a major portion of their reserves in gold.
In fact, until recent times gold and silver coins were used as medium of exchange � that is, as money.
The British Pound and the US Dollar owe the prestige of their use as reserve currencies to their (now historical) guaranteed equivalence to a certain amount of gold, as much as to any other new cause.
Even today, when people's trust ebbed as to the ability of the banking system to return their deposits or as to that of the government to guarantee the value of the currency, people resorted to gold to hold their wealth in, if it was possible..."
There is a growing consensus that OPEC will soon cut production 1- 2 million b/d. Indications that Kuwait's and Saudi Arabia's are in agreement make a production cut make it almost a foregone conclusion at the cartel's meeting later this month will be positive for oil prices. Also lower interest rates should support the slowing US economy and buoy demand for petroleum.
The American Gas Association reported Wednesday that 209 Bcf of gas was withdrawn from US storage last week, slightly more than analysts expected. US gas storage is 708 Bcf, a record low for this point in the heating season and 29% below the level of a year ago. Remember that natural gas is a continental commodity, not a worldwide commodity. For example, in London, the February natural gas contract gained 4� to the equivalent of $3.86/Mcf.
Gretchen Morgenson, New York Times
Sunday, December 31, 2000
�2001 San Francisco Chronicle
Of all the rude awakenings that the bear market in stocks has brought to investors this year, perhaps the most jarring has been the realization of how wrong Wall Street research analysts have been on the stocks they follow. How can so many who are paid so much to scrutinize companies have blown it so spectacularly for their investor customers? The answer lies in a subtle but significant change in the way Wall Street analysts do their work and how they are rewarded for it. That shift, which has brought riches and stardom to many securities analysts, has cost investors billions of dollars in losses. The fact is, although brokerage firm stock gurus are still called analysts, their work involves more salesmanship than analysis.
"The competition for investing banking business is so keen that analysts' sell recommendations on stocks of banking clients or potential banking clients are very rare," said Arthur Levitt, chairman of the Securities and Exchange Commission. "Whether this is an actual or perceived conflict, . . . brokerage firm analysis has diminished credibility."
"What passes for research on Wall Street today is shocking," said Robert Olstein, a mutual fund manager with 32 years of experience analyzing companies' financial results. "Instead of providing investors with the kind of analysis that would have kept them from marching over the cliff, analysts prodded them forward by inventing new valuation criteria for stocks that had no basis in reality." Although no one can predict what stocks will do tomorrow, much less next year, Wall Street's analysts are supposed to help investors judge companies' shares. Investors look to analysts to advise them on whether to buy or sell a stock at its current price.
Until the mid-1990s, that is how most analysts approached their work. Today, there is virtually no such thing as a sell recommendation from Wall Street analysts. Of the 8,000 recommendations made by analysts covering the companies in the Standard & Poor's 500 index, only 29 now are sells, according to Zacks Investment Research in Chicago. That's less than 0.5 percent. On the other hand, "strong buy" recommendations number 214.
Analysts have long been known for unrelenting optimism about the companies they cover. But many investing veterans say the quality of research has sunk to new lows. That decline, they say, results from business shifts that have pushed many researchers to put their firms' relationships with the companies they follow ahead of investors. The commissions charged by Wall Street firms to their institutional and individual customers for trading stocks are one factor. These fees were much higher in the 1970s and 1980s, such as 10 cents per share on trades then versus 1 cent or less now. Because analysts' recommendations helped generate trades and commissions, research departments paid for themselves. More important, an analyst who uncovered a time bomb ticking away within a company's financial statements and who advised his customers to sell its shares made an important contribution to his firm in commissions those sales generated.
As commissions declined, Wall Street firms looked elsewhere for ways to cover research costs. Investment banking was an obvious choice. Analysts soon began going on sales calls for their firms, which were competing for stock underwritings, debt offerings and other investment banking deals. In this world, negative research reports carried a cost, not a benefit. The result is that the traditional role of analyst as adviser to investors has been compromised.
Black Blade: Most securities analysts are nothing more than charlatans and con men. Listening Abby Jo? I use them as contrary indicators along with simple fundamental analysis. The Mary Meeker's, Joe Battapaglia's and Abby Jo's of the investment world should be looked only as clowns who entertain and not for any serious consideration.
"But, as he has pushed back each harbinger or lesser trigger of that implosion, he has aligned all of the disparate elements in a grand conjunction, a parting of the economic Red Sea (in which his own chariots must perish), and the almost meticulously calculated as-if-planned Perfect Storm that will fall upon the economy with full fury and spare no frivolous item of economic waste from dissolution."
Very colorful imagery. Either this business with the California Utilities and associated banks was just a bump in the road or it is only the beginning of more of the same to follow.
People seem divided over the competence of Alan Greenspan, some believe him to be all powerful while others perceive him to be a dolt. Japan should serve as a good object lesson that one can lower interest rates only so far. One thing seems for sure, if this is only the beginning of a "Herstatt" scenario, we will surely see what AG is made of.
Black Blade, re: your msg#: 45162: Gretchen Morgenson sounds just like Bill Fleckenstine who has lamented their game for quite some time now�he refers to them as "dead fish".
I don't know if it has been mentioned here before but the Yahoo link above shows what the analysts have had to say about a given stock over the last twelve months. Interestingly enough, there is hardly ever a recommendation to sell despite the markets� decline over the last ten months. I entered Priceline.com (pcln) whose stellar performance brought it from $100 in March down to $1 around the end of the year. Contrary to the analysts� recommendations, however, it is obvious the stockholders had a different opinion on the matter.
What is it the market knows, or thinks it knows, that the rather hoarse but still game cheerleading crew on the Street doesn't? The sage of Hong Kong (and anywhere else he happens to light), Marc Faber, in his latest Gloom, Boom & Doom Report, supplies the likely answer.
Marc stresses that there are two distinct types of booms: The first is consumption-powered, the other "an asset bubble or new-technology-driven capital-spending" kind -- which, you doubtless recognize, is the boom we all, until recently, so greatly enjoyed. A consumption boom typically ends because, well, consumers tire of consuming. In countering the recession that follows, Marc comments, tax cuts and rate cuts can be effective, once inventories are liquidated, in rekindling growth.
The asset bubble or new-technology boom, however, is a whole different animal, and so are the causes of its demise. The main culprit is a surfeit of capital investment that inevitably leads to oversupply and glut. Margins and profits suffer, returns to the folks spending all that dough fail to meet expectations and asset values crumble. "Even zero interest rates," Marc ventures, "may not help."
Compounding the woe is that an asset bubble or capital-spending boom is financed largely by long-term borrowings at fixed rates. During the bust, the interest costs on the long-term debt assumed to finance capital investment do not decline; indeed, in real terms, they become more onerous, the sorry stuff of rising defaults and bankruptcies.
Bubbles and investment manias, Marc says, always mark the terminal phase of a business expansion, although mistaken for its start. They are followed invariably by "deflationary busts, sharply declining equity prices, a weakening currency and a downward spiral in the economy."
Gold to the moon -- how it could happen @Mr Gresham msg#: 45146, ALL
"It's hard to see $30,000, no matter how much of the above occurs; hard to see that something else
wouldn't siphon off those $ somewhere on the way to that, but none of us really NEED that number
just now except as an attention-getter, right?" -Mr. Gresham
Hi Mr. G.!
Something that WOULD drive gold to the moon would be if a "new" and valuable use were suddenly discovered for which it has not previously been used. (By the way, this is straight from Mises.)
Suppose the U.S. dollar crashed and as a result, world-wide confidence in and support for fiat money crashed right along with it. Not an impossible scenario, yes?
What would people use to store their value in? Even us slow, de-facto ignore ant Americans?
Hello Friend. Sorry to not have been able to participate in your worthy contest yesterday. We were celebrating my ingenue's 50th and what a celebration it was. After post #44921, aka 1001 Clinton insults, I am currently fresh out of "truths" to throw back at him. It is really a very empty feeling for now, but eagerly await the Queen's next move for more fodder. Is it 14 days left now? Let the bad times go! In the interest of fairness to all I suggest we extend the season for the following 14 days. A few rules are appropriate: 1- There will be no high blows allowed. 2- When you hear the bell---ignore it. 3- Anything goes.
Thanks to the silent members, who would never dream of publicly insulting their prez, for allowing us these liberties here. Thanks also to those that are in complete disagreement with this line of thought for indulging those few of us that are so inclined. If it is any consolation to you, I anticipate the same treatment of new guys if they start clowning it up.
Did anyone see the photo op with Bill, Hill, & Al together as Hill was being sworn in? All three had at least a pinkie on some little black book, a bible hopefully. Ms. Rodham had that delerious & goofy grin on, she really needs to work on that. I do not remember if the 3 Stooges had their other hands behind their backs or not. Betting that some fingers, toes, or legs were crossed during this swearing in. Some of that emptiness seems to be leaving now, things are looking up. 14 days really isn't that much time.
Do you think HRC will attempt a Senate takeover in her first year, or will she have learned from her health care fiasco and wait until the 2nd year? Every time in the past when The Queen Mother got snared in the wringer she was able to retreat back to her unelected civilian status and hide there. That will no longer be possible and frankly I don't think she has a chance of withstanding the scrutiny she will be under.
That goofy grin is gonna wear real thin. Let's watch these folks closely and celebrate our American heritage.
Got Gold, GATA, Gall??
FOA From The Gold Trail #52,,,,,All I can say is, WOW!!!
Sir,
In this part of your message:
<< The only paper owners that are not worried are the ones with an economic good that demands satisfaction, in gold if
needed. Oil! The rest of us must bolt towards the closest "par" conversion first. Real gold.>>
I take it to mean Producers of Oil will be paid in Gold or Euro's to keep the oil flowing.
Is this assumption correct?
And, if physical Gold supplies are at some point exhausted Central Bank Gold or Ft. Knox Gold will be used to pay for oil?
FOA, I would like to echo USAGOLD's strong welcome back and best wishes to you and ANOTHER and all your loved ones for the coming events and New Year 2001...beesting.
Hello Stranger,
according to MF/Barrons 2 types of booms - either
a. consumption powered - or
b. asset bubbles in new tech. - capital spending.
Seems to me this time both boom types relied on each other and who knows which occurred first to lead the other to either monetary oblivion or capital malinvestments at the grandest scale bust- ever experienced? ... and the winner of the double bubble IS... (not Chicklet's bubble gum-is it Bazooka?) - No there are only losers - maybe double credit bubble losers are still manageable by the Greenspun hype - the accentuated derivative BUBBLE`of a 100 trillion $ Delta hype of the "Nobly" priced Black/Sholes type won't ever be work, even in and in spite of counter party risk group{ie)s - an association of naked and short 3-letter word - well knowing thhe scam won't work - when the party is over and the counter{s) are bare ... BAC was a scare ... and we'll have more of the same - end of game?
I'll ask you - cb2
I see Beesting's WOW over FOA's message and I'm almost afraid to click into it. Might be possessed to run out for one of those 125% mortgages to take more FRNs over to the local coin dealer...
The The power of $3000 credit creation gold price.
Most people lose money on Wall Street. For every loser there is a winner. The money that disapeared from your mutual fund and stock accounts did not vanish: it simply changed owners. Presently insiders are preparing another, even more massive sell-off for March, April and May. Many high tech excecutives and insiders will have a lot of shares that come out of lock up and will be dumping literally billions of dollars worth of their own companies stock. Most buy backs of company stocks is made possible by bank financing or ordinary investors brokerage accounts money to make possible the cashing in of insider stocks. Wall Street is a financial ponzi scheme made possible with credit creation gold at a price of $3000+. Gold money has been replaced by the "promise to pay". We have a controlled commodity gold price of $270 and a free underground credit creation gold market price of $3000+. This spring the markets will collapse like a house of cards it really is for it has become dependent on the "promises to pay" that are not payable because income cannot be dollarized excepy by becoming more debt. Many high flying wall street corporations have used their stock price as a means of buying income. As stock prices go so does the income. In our monetary system all money is debt money. There is no other source of money except to borrow it into existence. In this way income cannot be dollarized except by becoming more debt. The FED is using the credit creation $3,000 gold price to achieve parity in order to double the debt in our present context. It can easily reprice the credit creating gold price to $6,000 and double the debt of the $3,000 credit creating gold. The bottom line is that debt cannot be paid off with debt, and debt generates no aggregate income that is not offset by more debt. It takes production times price to generate aggregate income for an economy. Greenspan can not produce more electric power by increasing money supply with more and cheaper loans. Somebody actually has to built the real physical plants to do it. Greenspan can issue more greenbacks but he can not issue green beans. You actually have to grow them. Greenspan can not print electric power, print food or oil or a lot of other things we need. We in USA have two choices- 1 monetize the debt or 2 default. Russia is doing it right by defaulting. Default is a sure and prompt way to reduce debt where monetization reduces the value of the currency or your savings.--- Write your elected representative and ASK 1- What is the price that credit creation gold changes hands between central banks and 2- What is the price of gold USA settles its trade deficits with at BIS. It is sad that in a so called free country we the people are forced to gold at the controlled commodity price not the central banks credit creation price which is many times higher. I like GATA but I no longer agree to what they are doing. They already have the answere to 1+2 above and are doing nothing to make it public.
I'd just like to ask, who does all this "planning" developing and implementing the "means" to achieve an "end" that is far off in the future. It would seem to require an impossible amount of coordination among individuals and nations with varied, conflicting objectives. Thanks..CM
I have an acquaintance living in SLC, UT who reports his "customers" are having trouble paying their bills. One in particular, closely affiliated with the "new economy" is barely paying in 60 days and now is on a cash with order basis.
I know a little girl that would be happy to take you on a bit of a walk from Paradise Lodge to a panoramic view of the trail. Anytime you're near, OK?
This sounds like the nub of it, the trigger: "It will be the inability to reconstruct the present volume of paper gold into a new reserve currency, the Euro, that breaks the gold pricing system."
In other words, two parties get to the point of finalizing a gold contract, and one of them says, "Now, ah, how much would you be willing to do that for, in Euros?"
And the other one says, "Mmmmm, well, ahhhhh, no can do, sorry. Now can we just sign this and get on our way?"
That one knows that the creators of dollars are very likely to bail him out in a force majeure situation, whereas the creators of Euros will not jeopardize their new currency's stability to do so. Playing in a different ballpark.
I'll keep reading for more, but might be interrupted (guests -- I'm such a BAD host!) so I'll hit "Submit" now.
http://www.bookmarkusa.com/goldweekly.jpgThe breakout attempt at the end of December failed (was there ever any doubt?...a breakout at this time of year would have been very unusual, indeed).
Notice how the upper trendline is becoming more important as every week passes. Notice also how the breakout price falls every week...it now sits near $272. Every week increases the odds of the breakout - I expect it to occur by the end of March at the latest (my guess is sooner rather than later). With the dollar now falling and the equity markets not rejoicing over Uncle Al's interest rate cuts, anytime after the next BOE auction on January 23rd looks prime for gold to make its move. The 1993 breakout took place on March 30th.
BTW, the bottom trendline is drawn from the 1996 bear market and shows this pattern from October '99 for what it is - backing and filling.
Any trumpeting of the entry of the HOWE/GATA case, as it enters the doorways of the lawcourts, I believe on Monday Jan 8,2001, could be drowned out by the sickening sound of a crashing market.
To my knowledge, not much has been written as yet about the prospects for 'the day after' one of the most extraordinary weeks in US market history. However, for anyone still long the NASDAQ, this could be a long weekend...perhaps long enough to penetrate the denial mechanism that has kept them long to date. Should the latter prove to be the case, there could be a rush to the exits as panic and capitulation trigger the final stage of ' the triple waterfall'. Hopefully, the process of realization will proceed in a more orderly fashion and continue its currently angled downward trough.
However, how ironic and perhaps sadly appropriate, if these two events were to coincide. ie. the presentation of evidence of corruptive practice in one area paired with the inevitable payoff of any action that seeks to
mask/deflect/deceive true market forces.
Even better than the proton/electron analogy is the 'supernova', the unbalance of gravity(mass) and energy eventually eating through/using up the different elemental layers until iron, and then swift collapse.
Central Banks, Gold, -
and the Decline of the Dollar
Robert Batemarco
This article is adapted from a presentation given before a Freeman Society gathering in suburban Philadelphia in May 1995.
Are inflation, currency depreciation, and business cycles inevitable facts of life? Are they part of the very laws of nature? Or do their origins stem from the actions of man? If so, are they discoverable by economic science? And, if economics can teach us their origins, can it also teach us how to avoid them?
The particular need which all money, even fiat money which we now use, serves is to facilitate exchange. People accept money, even if it is not backed by a single grain of precious metal, because they know other people will accept it in exchange for goods and services.
But people accept the U.S. dollar today in exchange for much less than they used to. Since 1933, the U.S. dollar has lost 92 percent of its domestic purchasing power.1 Even at its "moderate" 1994 inflation rate of 2.7 percent, the dollar will lose another half of its purchasing power by 2022. In international markets, the dollar has, since 1969, depreciated 65 percent against the Deutsche Mark, 74 percent against the Swiss franc, and 76 percent against the yen.2
Many economists claim that this is the price we pay for "full employment." If so, I'd like to ask who among you thinks we've gotten our money's worth. We've experienced 11 recessions 3 since the advent of inflation as the normal state of affairs in 1933, with the unemployment rate reaching 10.8 percent as recently as 1982. Clearly, the demise of the business cycle - a forecast made during every boom since the 1920s - is but a mirage.
Other things being equal, if the quantity of anything is increased, the value per unit in the eyes of its users will go down. The quantity of U.S. money has increased year in and year out every year since 1933. The narrow M1 measure of the quantity of U.S. money (basically currency in circulation and balances in checking accounts) stood at $19.9 billion in 1933. By 1940, it had doubled to $39.7 billion. It surpassed $100 billion in 1946, $200 billion in 1969 (and 1946-1969 was considered a non-inflationary period), $400 billion in 1980, $800 billion in 1990, and today it stands at almost $1.2 trillion. That is over 60 times what it was in 1933.
For all practical purposes, the quantity of money is determined by the Federal Reserve System, our central bank. Its increase should come as no surprise. The Federal Reserve was created to make the quantity of money "flexible." The theory was that the quantity of money should be able to go up and down with the "needs of business."
Under the Fed, "the demands of government funding and refunding ... unequivocally have set the pattern for American money management." 4 Right from the start, the Fed's supposed "independence" was compromised whenever the Treasury asserted its need for funds. In World War I, this was done indirectly as the Fed loaned reserves to banks at a lower discount rate to buy war bonds. In 1933, President Roosevelt ordered the Fed to buy up to $1 billion of Treasury bills and to maintain them in its portfolio in order to keep bond prices from falling. From 1936 to 1951, the Fed was required to maintain the yields on Treasury bills at 3/8 percent and bonds at 2.5 percent. Thereafter, the Fed was required to maintain "an orderly market" for Treasury issues.5 Today, the Federal Reserve System owns nearly 8 percent of all U.S. Treasury debt outstanding.6
The Fed granted access to unprecedented resources to the federal government by creating money to finance (i.e., to monetize) its debt. It also served as a cartellization device, making it unnecessary for banks to compete with each other by restricting their expansion of credit. Before the emergence of the Fed upon the scene, a bank which expanded credit more rapidly than other banks would soon find those other banks presenting their notes or deposits for redemption. It would have to redeem these liabilities from its reserves. To safeguard their reserve holdings was one of the foremost problems which occupied the mind of bankers. The Fed, by serving as the member banks' banker, a central source of reserves and lender of last resort, made this task much easier. When the Fed created new reserves, all banks could expand together.
And expand they did. Before the Fed opened its doors in November 1914, the average reserve requirement of banks was 21.1 percent.7 This meant that at a maximum, the private banking system could create $3.74 of new money through making loans for every $1 of gold reserves it held. Under the Fed, banks could count deposits with the Fed as reserves. The Fed, in turn, needed 35 percent gold backing against those deposits. This increased the available reserve base almost three-fold. In addition, the Fed reduced member bank reserve requirements to 11.6 percent in 1914 and to 9.8 percent in 1917.8 At that point, $1 in gold reserves had the potential of supporting an additional $28 of loans.
Note that at this juncture in time, gold still played a role in our monetary system. Gold coins circulated, albeit rarely, and banknotes (now almost all issued by the Federal Reserve) and deposits were redeemable in gold. Gold set a limit on the extent of credit expansion, and once that limit was reached, further expansion had to cease, at least in theory. But then limits were never what central banking was about. In practice, whenever gold threatened to limit credit expansion, the government changed the rules.
Cutting off the last vestige of gold convertibility in 1971 rendered the dollar a pure fiat currency. The fate of the new paper money was determined by the whim of the people running the Fed.
The average person looks to central banks to maintain full employment and the value of the dollar. The historical record makes clear that a sound dollar was never the Fed's intention. Nor has the goal of full employment done more than provide them with a plausible excuse to inflate the currency. The Fed has certainly not covered itself with glory in achieving either goal. Should this leave us in despair? Only if there is no alternative to central banking with fiat money and fractional reserves. History, however, does provide us with an alternative which has worked in the past and can work in the future. That alternative is gold.
There is nothing about money that makes it so unique that the market could not provide it just as it provides other goods. Historically, the market did provide money. An economy without money, a barter economy, is grossly inefficient because of the difficulty of finding a trading partner who will accept what you have and who also has exactly what you want. There must be what economists call a "double coincidence of wants." The difficulty of finding suitable partners led traders to seek out commodities for which they could trade which were more marketable in the sense that more people were willing to accept them. Clearly, perishable, bulky items of uneven quality would never do. Precious metals, however, combined durability, homogeneity, and high value in small quantity. These qualities led to wide acceptance. Once people became aware of the extreme marketability of the precious metals, they could take care of the rest without any government help. Gold and silver went from being highly marketable to being universally accepted in exchange, i.e., they became "money."
If we desire a money that will maintain its value, we must have a money that cannot be created at will. This is the real key to the suitability of gold as money. Since 1492 there has never been a year in which the growth of the world gold stock increased by more than 5 percent in a single year. In this century, the average has been about 2 percent.9 Thus with gold money, the kind of inflations that have plagued us in the twentieth century would not have occurred. Under the classic gold standard, even when only a fractional reserve was held by the banks, prices in the United States were as low in 1933 as they had been 100 years earlier. In Great Britain, which remained on the gold standard until the outbreak of World War I, prices in 1914 on the average were less than half of what they were a century earlier.10
Traditionally, the gold standard was not limited to one or two countries; it was an international system. With gold as money, one need not constantly be concerned with exchange rate fluctuations. Indeed, the very notion of an exchange rate is different under a gold standard than under a fiat money regime. Under flat money, exchange rates are prices of the different national currencies in terms of one another. Under a gold standard, exchange rates are not prices at all. They are more akin to conversion units, like 12 inches per foot, since under an international gold standard, every national currency unit would represent a specific weight of the same substance, i.e., gold. As such, their relationships would be immutable. This constancy of exchange rates eliminates exchange rate risk and the need to employ real resources to hedge such risk. Under such a system, trade between people in different countries should be no more difficult than trade among people of the several states of the United States today. It is no accident that the closest the world has come to the ideal of free international trade occurred during the heyday of the international gold standard.
It is common to speak of the "collapse" of the gold standard, with the implication that it did not work. In fact, governments abandoned the gold standard because it worked precisely as it was supposed to: it prevented governments and their central banks from surreptitiously diverting wealth from its rightful owners to themselves. The commitment to maintain gold convertibility restrains credit creation, which leads to gold outflows and threatens convertibility. If government were not able to resort to the issue of fiat money created by their central banks, they would not have had the means to embark on the welfare state, and it is possible that the citizens of the United States and Europe might have been spared the horrors of the first world war. If those same governments and central banks had stood by their promises to maintain convertibility of their currencies into gold, the catastrophic post -World War I inflations would not have ensued.
In recent years, some countries have suffered so much from central banks run amok, that they have decided to dispense with those legalized counterfeiters. Yet they have not returned to the gold standard. The expedient they are using is the currency board. Argentina, Estonia, and Lithuania have all recently instituted currency boards after suffering hyperinflations. A currency board issues notes and coins backed 100 percent by some foreign currency. The board guarantees full convertibility between its currency and the foreign currency it uses as its reserves. Unlike central banks, currency boards cannot act as lenders of last resort nor can they create inflation, although they can import the inflation of the currency they hold in reserve. Typically, this is well below the level of inflation which caused countries to resort to a currency board in the first place. In over 150 years of experience with currency boards in over 70 countries, not a single currency board has failed to maintain full convertibility.11
While currency boards may be a step in the right direction for countries in the throes of central-bank-induced monetary chaos, what keeps such countries from returning to gold? For one thing, they have been taught by at least two generations of economists that the gold standard is impractical. Let's examine three of the most common objections in turn:
1. Gold is too costly. Those who allude to the high cost of gold have in mind the resource costs of mining it. They are certainly correct in saying that more resources are expended to produce a dollar's worth of gold than to produce a fiat dollar. The cost of the former at the margin is very close to a dollar, while the cost of the latter is under a cent. The flaw in this argument is that the concept of cost they employ is too narrow. The correct concept economically speaking is that of opportunity cost, defined as the value of one's best sacrificed alternative. Viewed from this perspective, the cost of fiat money is actually much greater than that of gold. The cost of flat money is not merely the expense of printing new dollar bills. It also includes the cost of resources people use to protect themselves from the consequences of the inevitable inflation which fiat money makes possible, as well as the wasted capital entailed by the erroneous signals emitted under inflationary circumstances. The cost of digging gold out of the ground is minuscule by comparison.12
2. Gold supplies will not increase at the rate necessary to meet the needs of an expanding economy. With flexible prices and wages, any given amount of money is enough to accomplish money's task of facilitating exchange. Having the gold standard in place in the United States did not prevent industrial production from rising 534 percent from 1878 to 1913.13 Thus it is a mistake to think that an increase in the quantity of money must be increased to assure economic development. Moreover, an increase in the quantity of money is not tantamount to an increase in wealth. For instance, if new paper or fiat money is introduced into the economy, prices will be affected as the new money reaches individuals who use it to outbid others for the existing stocks of sport jackets, groceries, houses, computers, automobiles, or whatever. But the monetary increase itself does not bring more goods and services into existence.
3. A gold standard would be too deflationary to maintain full employment. As for the relationship of a gold standard to full employment, the partisans of gold have both theory and history on their side. The absolute "level" of prices does not drive production and employment decisions. Rather the differences between prices of specific inputs and outputs, better known as profit margins, are keys to these decisions. It is central bank creation of fiat money which alters these margins in ways that ultimately send workers to the unemployment line. Historically, the gradual price declines which characterized the nineteenth century made way for the biggest boom in job creation the world has ever seen.
The practical issues involved in actually returning to a gold standard are complex. But one of the most common objections, determining the proper valuation of gold, is fairly minor. After all, the market values gold every day. Any gold price other than that set by the market is by definition arbitrary. If we were to repeal legal tender laws, laws which today require the public to accept paper Federal Reserve Notes in payment of all debts, and permit banks to accept deposits denominated in ounces of gold, a parallel gold--based monetary system would soon arise and operate side-by-side with the Federal Reserve's fiat money.14
A more difficult problem than that would be how to get the gold the government seized in 1934 back into the hands of the public. But even that surely can't be more difficult than returning the businesses seized by the Communists in Eastern Europe to their rightful owners. If the Czech Republic can do that, we should be able to get government--held gold back into circulation.
In all likelihood, the biggest problem gold proponents face is that people simply aren't ready to go back to gold. Most people aren't aware of the extent of our monetary disarray and many of those who are don't understand its source. Two generations of Americans have known nothing but un-backed paper as money; few realize that there is an alternative. In contrast, when the United States restored gold convertibility in 1879 and when Britain did so in 1821 and 1926, gold money was still seen as the norm. That is no longer the case.
It might take a hyperinflationary disaster to shake people's faith in fiat money. Let's hope not. In addition to the horrendous costs of such a "learning experience," it's not even a sure thing that it would lead us back to gold. Recent hyperinflations in places as disparate as Russia and Bolivia have not done so.
The desire to get something for nothing dies hard. Governments use central banks with the unlimited power to issue fiat money as their way to get something for nothing. By "sharing" some of that loot with us, those governments have convinced us that we too are getting something for nothing. Until we either wise up to the fact that governments can't give us something for nothing or, better yet, when we realize the moral folly of taking government handouts when of-fered, we will continue to get money as base as our desires.
--------------------------------------------------------------------------------
At the time of the original publication, In addition to editing the book review section of The Freeman, Dr. Batemarco was a marketing research manager in New York City and taught economics at Marymount College in Tarrytown, New York.
--------------------------------------------------------------------------------
1. Arsen J. Darnay, editor, Economic Indicators Handbook (Detroit, London: Gale Research Inc., 1992), p. 232 and Survey of Current Business, vol. 75, February 1995, p. C-5 .
2. The Wall Street Journal, April 7, 1995, and The Economic Report of the President, 1995.
3. As measured by the National Bureau of Economic Research.
4. Robert J. Shapiro, "Polities and the Federal Reserve," The Public Interest, Winter 1982, p. 123.
5. Shapiro, pp. 126-127.
6. Federal Reserve Bulletin, February 1995, p. A30.
7. Murray N. Rothbard, "The Federal Reserve as a Cartellization Device: The Early Years, 1913-1930," in Barry N. Siegel, editor, Money in Crisis (Cambridge: Ballinger Publishing Company, 1984), p. 107.
8. Rothbard, pp. 105-106.
9. Richard M. Salsman, Gold and Liberty (Great Barrington, Mass.: American Institute for Economic Research, 1995), p. 26.
10. Michael David Bordo, "The Classical Gold Standard: Some Lessons for Today," Federal Reserve Bank of St. Louis Review, May 1981, pp. 8-9.
11. Steve H. Hanke, "Critics Err-Mexico Still Needs a Currency Board," The Wall Street Journal, February 22, 1995.
12. For a fuller treatment of this issue, see Roger Garrison, "The Cost of a Gold Standard," in Llewellyn H. Rockwell, Jr., editor, The Gold Standard: An Austrian Perspective (Lexington Books, 1985), pp. 61-79.
13. Alan Reynolds, "Gold and Economic Boom," in Sicgel, p. 256.
14. Hans Sennholz, Money and Freedom (Spring Mills, Pa.: Libertarian Press, 1985), pp. 81-83.
Reprinted with permission from The Freeman, a publication of the Foundation for Economic Education, Inc., November 1995, Vol. 45, No. 11.
Post #45146 Squeeze Is On- HOF NominationThat was one fine post, my friend, and of tremendous help in INTERPRETING what you see and know for others to understand the complexities of the international payment system. Thank you! There are so many levels of knowledge among Forum posters and readers that multiple levels of INTERPRETATION are wonderful. I sometimes struggle to grasp what you are explaining, but grasp it I did, and that is exactly what is called for.
As far as SteveH's input in regards to giving Greenie "too much credibility" because he doesn't control all the Fannies, Freddies, Funnies, and other various Friends--- These entities are not directly under Fed's {AG's}responsibility, but the "strings" extend upward to the common masters for all the various F's {that speaks volumes, no?}. We are looking at the same creature here regardless how a blame game plays out. I am always truly appreciative of what SteveH posts because he is spot-on 99.9% of the time! Thank you SteveH.
You waxed eloquently in this post Mr. Gresham, and your analogy to molecular chemistry was splendid. Of course the streets of Money Heaven should have "streets paved with fiat". OUR MASTER must have sent that one your way! The CLHE-HoF guys have been inspired. More footprints to fall into and pull ourselves out of. I think AG will part the "Green Sea" that will turn Red after swallowing his chariots and his Fannie, but let us not quibble.
Well done and thus deserving of an official HoF nomination!
... Well, while I'm considering myself a simpleton and one having had a few Scotches too many tonight - returning from a nice dinner with friends - I have to confess I'm at a loss following some recent steps of FOA/TG's trail, as I may have ended up in the imprint of a footstep of a giant- too big for a midget.
... this new dollar drop to kick off the next gold bull market. It will, but Another dynamic will happen first.
... the inability to reconstruct the present volume of paper gold into a new reserve currency, the Euro ...?
... Well why would I need this detour in acquiring physical at rock bottom, except as euro zone gold buyer lately it's getting cheaper with the dollar depreciating, though why should anyone wait for physical gold markets in euro, while you can buy physical anyway - and even in still inflated dollars?
... Granted paper gold (or future contracts) are setting the perceived POG today and granted it will not hold up in reality if delivery of reality or better physical will be required by only a few of the outstanding contracts.
All of that and much more of what you, FOA say I can easily accept - as I may be able to accept gold trading sructures and contracts are perceived to shift to another reserve currency... and cannot be converted at par ... at happy with today's physical parity - I mean you can effectively buy gold now at perceived paper gold prices... and yes it is getting even cheaper in euros - so while the dolllar hyperinflates and the new euro only inflates I'll be happy to utilze this window of exchanging currencies sub-par for physical gold (and some unencumbered "locked in peanut" reserves in the ground).
As it seems, Sir FOA, I'm still an ant at the Krakatoa and not at the relative begnign slopes of Mt. Rainer, where potential eruptions might be welcome to supplement
dwindling power supplies of the peoples west coast Republics. Give me real fire wood and bullion gold anytime and I could do without the next digital fiat currency - reserve or not - True? cb2
Usul (1/6/2001; 6:13:44MT - usagold.com msg#: 45160)
Hello Usul,
Your link to the Islamic banking article provided a synopsis of the 4 books by the Author.
In his 2nd (?) book he outlines a method of compensating for inflationary effects on invested capital under an Islamic (ie: NO interest) system of banking using only the POG as an inflation adjuster.
If perchance you have read his works, can you please elaborate on this method of inflation discovery?
A Passage Regarding Wage Inflation from Gene Epstein's Column in Today's Barron's
As great a contributing inflation factor as is energy, labor costs are far greater. They are, in fact, by far the largest cost component in any economy. For the past two years the disinflation crowd has cited rising labor productivity and sluggish wage gains as proof that U.S.inflation was under control. Now, as the economy and capital investment slow, we all know that systemic productivity gains will be darn near impossible to achieve. But what about wages? Are they set to accelerate or not? It was with great interest that I read the following comments on this subject in today's Barron's:
"So with the tightest labor market in more than 30 years, and with productivity soaring, wages and salaries are rising a lot faster than the rate of inflation. The December report showed that average hourly earnings for "nonsupervisory" workers (about four-fifths of the total), rose at an annualized rate of 5.3% in the fourth quarter, which matched the peak set in October '97. The Commerce Department has found that if supervisory workers are added, then you generally mark that figure up by about 1.5%-2%, which would bring hourly earnings growth for all workers to about 7%."
Black Blade, my teacher in school said that in order give a good speech one must know ten times more about the subject than one actually delivers. I suspect that you read about ten times more articles than the quality posts that you pass on to us. I thank you so very much for your ongoing efforts.
Do you ever sleep?
I am taking the liberty of commenting on two of the articles that you posted. This is from a Joe Six Pack education but many years of hard knocks.
Black Blade msg#: 45087)
By JAMES FLANIGAN, Times Senior Economics Editor
<>
Truly, as peoples, we can know nothing if perception cannot separate "real" from "illusion".
---------------------------------
In that spirit, I offer this suggestion for those worried about possible gold confiscation.
The Plan:
So the big, dumb storm troopers are pounding on your door, demanding your gold. You open the door and the squad leader demands, "we know you have gold, give it to us now!" Slowly, with great reluctance, you lead them to your kitchen sink. From under it you take out your old sock, clinking with coins.
They grab it and rip it open. Sure enough, the golden hue grabs all their attention. Your hoard of carefully saved Sacagawea �golden dollars�. All gone. Stolen by a government sworn to protect you. Sigh. Well, things could be worse�
though try pink -as in gin or Put'in's highly recommended potato destillate, called "Vodka" (whot can you put in without puttin' Putin in?)- No PGE's for sale- njet - gold -you bet!
... and the tale of NEM, (only big player in Uzbekistan)
a producer of value
withstanding the stratagem
of the usurer.
For too long, say some
as Ron Cambre leaves
no open doors, come!
to the thiefs.
And they try to steal
all value from me
I just might appeal
to the SEC and the CFTC -
California Scheming - Don't blame deregulation for the Golden State's electricity snafus
http://reason.com/ml/ml010401.html"...In 1996, Assemblyman Steve Peace, considered by some to be the Sen. Pat Moynihan of the California legislature, decided to get in front of this parade. He organized the relevant players �big industrial customers, utilities, environmental groups, and consumer groups�and the result was an electricity restructuring bill that passed the legislature unanimously. Whenever that happens, you can safely bet something screwy is going on.
Politicians claimed the plan would provide consumers with more choice and lower prices. Big business figured its purchasing power would allow it to secure lower prices, of the sort the feds deliver up in the Pacific Northwest with the heavily subsidized Bonneville Power Administration. Consumer and environmental groups got lots of restrictions on how the utilities could operate, including price controls, which, as Cuba shows, do a great job of protecting consumers from such things as consumer goods, including necessities such as food, clothing, and, well, electricity. They also got a guaranteed 10 percent rate cut right off the bat...."
...meshugge ... crazy, depraved, raving mad in a fatalistic and typical sense of "Tante Jolesch (TM* Friedrich Torberg)", every Austrian's good old aunt stating among other great indictments, that "any improvement to your looks in comparison to an ape is a luxury"!
... A statement, I would gladly pass on to my broker - (a luxury I never could afford, anyway)- Can he be as cute as AG? ... may be the question? ... Oh, of course after reading Goethe's Faust, Gretchen, no Gretchen Morgenson's essay is out of the question - an essay answering the Quest of to be or not to be in the SM (aka: systmic meltdown)- Gretchen may answer with the bee in your bonnett.
Honett - say's old Austrian gent and went to the end
and overspent
a Sonnett, which meant the end of credit on rent...
and the tent
mortgaged at 125% (percent)...
As Mises, Hajek and co. won't even pretend
to give a cent
to AG's Waterloo - I don't think sooo - tooo- cb2
Good Sir Knight: There are very many highly intelligent people who grace these hallowed halls. However, you Sir are much smarter than the average (Wall@Broad) bear (and witty2)
German magazine Der Spiegel reports on GATA lawsuit
6 January 2001 Konspiration in the gentleman club? Against US central bank head Greenspan runs a complaint because of manipulation of the gold price. Also the German bank should be complicated into the zwielichtigen business. What US central bank head do Alan Greenspan, the bank for international clearing payment (BIZ) have, prominent global cash houses like German bank and J. P. Morgan as well as the separating US Minister of Finance Larry of buzzer together? " these gentlemen and these banks are responsible for one of the grossten scandals of restaurant history " - at least the US lawyer and Goldanalyst the Reginald Howe maintain. The advisor of the gold anti-anti-Trust Action Committee (Gata), an organization, which used up itself the fight against the alleged gold market manipulation, submitted therefore in December complaint with the United States District Court/District OF Massachusetts in Boston. Howe appoints itself to the Sherman act of the USA. The law forbids ausdrucklich the " Fixing " from prices in the grenzuberschreitenden trade. " in betrugerischer way the trust pressed the price for the precious metal over years on an artificially low level ", maintains the plaintiff. The Okay for the machinations came from the white house. As instrument of the " Konspiration " Howe constitutes the BIZ in Basel. There the bosses of the most important issuing banks maintain close gang in styles of a gentleman club. Howe is one of the few free shareholders of the BIZ - which hold predominant majority the central banks - and as troublemakers already well-known. Officially the Basler institute - just like the German bank - refuses each substanziellen comment, the US issuing bank left an inquiry unanswered to the complaint. Reproach are happig: " mine companies, their workers and owners are driven by the low gold price into the ruin ", say Howe. " in the developing countries the weak ones on the distance remain. " And, so paradoxically it first sounds: The barrier Street banks will spreader by the allegedly manipulated price billions. Actually the precious metal lost much of its gloss. Up to the First World War the currencies of the most powerful states were bound the international monetary system to the gold, after the Second World War to start of the seventies were based on the key currency US Dollar, which was convertable in gold. Still the myth of the glitzernden metal and likewise much emotion prevail in the trade. After its high-altitude flight end of the seventies however is sagged the price. For months the course sticks ounce in the range between 260 and 300 dollar for each. That meets above all producers such as South Africa. For the first time in their history the cape republic exported palladium than gold in the passed year more platinum and. Before 20 years the resplendent material still stated unquestioned the export list. At that time the dealers obtained dollar per ounce from time to time over 800. Today, then the Gata chairman Bill Murphy counts, would have to be situated the gold price with free market " over 600 dollar per ounce ". Would have. Because the financial elite trusts Howe according to plaintiff and the Gata of a simple equation: Only a deep gold price is a good gold price. An attractive course is considered generally as last warning of a monetary depreciation in the USA and a high-altitude flight signals a schwaechelnden US Dollar at the international financial markets. Both is a horror vision for Greenspan.
If the course pushes too much upward, then the critics maintain, gold in New York and London, the most important commercial centres, on the market are thrown. " the central banks are ready to lend gold in large quantities if the price rises ", acknowledged Greenspan in July 1998 before the bank committee of the US house of representatives. For Howe a clear case: " the statement equals the assertion that the gold price is controlled. "
With the check-out counter of gold the grosen cash houses made shining gains. However the German bank proved at the end of of 1999 business with an estimated equivalent of 5000 tons of gold - 1500 tons more than the official reserves of Germany. Morgan, Chase and the Citibank announced at the end of June to 2000 numbers, which would correspond to a gold mountain of 8461 tons. The business follows a simple pattern: Institutes borrow gold from the central banks to one aeuerst to low interest. The advantage for the national places: From the to a large extent useless gold mountains at least a small gain is drawn.
The banks sell the borrowed ingots. With proceeds they acquire securities, whose net yields exceed the leihzins far. Just as lucrative as risky business - and everything on pump. If the price breaks out too much upward, would have to bleed German bank, Goldman, Chase and CO: Then the leihzins would shoot also up. And, more badly still, the buy-back at the market would be almost unbezahlbar. Because the central banks require sometime the gold borrowed from them again. The " gold carry trade " ran already now from the rudder. Experts estimate that the business banks the central banks up to 7000 tons owe. ", to be over ever re-imbursed ", the experts of Salomon Smith Barney, a bank of the Citigroup warn too much. Therefore, Howe concludes, " Goldman, Chase and the German bank in the passed two years regelmaeig each appearing Goldrallye at the New Yorker produce exchange Comex by mass sales strangled ". But Howes theory is disputed. " also some my customers believe in a Konspiration ", say Analyst Martin Murenbeeld, publisher " gold monitor new type character ". " after me the available data I am however not convinced of the theory. " Gold Fields mineral services, a Londoner consulting firm, accuses statistical misinterpretations to Howe. The conspiracy theory is wrong. The experts analyse the sagged gold price rather as consequence of the strong dollar and low inflation rates. Besides many central banks used each still so small improvement in prices, in order to loose-will the dead capital. Approximately 33,000 tons gold nevertheless store in the safe deposits of the national institutes and international organizations. When it comes to the hostile exchange, the responsible judge in Boston must decide now. Howe hopes to uncover then " the machinations of the gold trust before public ". Greenspan and the representatives of the high finance would have then under oath
JANUARY DIRK HERBERMANN
Your pedagogical prowress is unsurpassed. Thank you for presenting us with another gem of inspired insight. It surely helps convey a great deal of information to others whose vision is clouded.
You wrote >>> "Transitional performances always appear crippled due to the suboptimal operating conditions for the ultimate design task. To wit, battleships getting a tug out of harbor...jet airliners being pushed around at the terminal...euro gold reserves under a dollar-based derivitive scheme of pricing as the euro begins to rise (dollar begins to fall)...etc." <<<
Congratulations! "Der Spiegel" ("The Mirror") has
the highest reputation in Germany as the most
important news magazine and has uncovered many skandals
in the past. The publication has never been afraid
to uncover and publicize findings after their own
fact-checking. This is really a big deal. I assume
that after this publication the story will be picked
up by other news media in Germany as well. Also,
"Der Spiegel" has a TV program and it may be a good
idea for you to proactively contact them for an
interview.
Regards,
KR
Also from KR:
Subject: GATA Lawsuit also in "Netzeitung.de" the
largest German internet based daily newspaper.
****I'm imagining 1 million magazine readers and 8 million
Internet readers of "Der Spiegel" all gaining new interest in Gold.... Now where could 'ALL' this publicity lead..LOL
and seeing the tide of sentiment turning very soon......YGM
Earnings Warnings, Debt Default, and High Energy Costs Force Rate Cut!
Things don't look so good in the investment world these days. The Utes in the Peoples Republik of Kalifornia have put the screws to Bill Richardson and have won official orders that the power producers in the western states provide "cheap" power to Kalifornia to the detriment of their own customers. So far, compliance has been sketchy as most of these providers fear that they won't be paid. The threat of bankruptcy is very real. If anyone here owns shares in the Kalifornia Utes, I offer my condolences as you have my sympathy. The high cost of energy is a real drag on the economy and several companies are expected to release earning warnings over the next few days. That is the reason for the "surprise" rate cut that Cheeta and the other creatures at the zoo gave out. A rate cut between FOMC meetings is not a very common event. This has only happened a couple of times in recent history. One time this happened just as the LTCM debacle had threatened to bring the Bull Market to a screeching halt. The higher costs of energy have always preceded every recession in the post-war economy. Many economic researchers say that we have entered into a recession and many more say that recession is inevitable now. The high cost of energy � this time natural gas and electricity � are the real culprits. Say a prayer over the corpse of the "Bull" and break out the BBQ sauce. The market is in a tailspin and the bone crushing crash is imminent. One could expect that technology, retail, and financial issues will post lower earnings or even losses over the next few days all while the so-called analysts call for anyone with a dollar left to his or her name to "buy the dips." Only no one is left in the hall, and the voices of the analysts� echo will a hollow ring. So hang on to your hats and get ready for a wild roller coaster ride, as Cheeta monkeys will the controls.
That's not all folks - now Russia has defaulted on bonds, again. OOPS! I mean - restructured their bonds again. These are the German bonds. It doesn't matter, as after 60 days it becomes a technical default and they will default. They have over $48 billion worth of bonds coming due and they just "restructured" a $5 million payment. Looks like it's time for the IMF to come to "help out" the poor Russians.
To hear the Wall Street pundits on the weekend financial shows, everything is just "peachy." I'm tightening my grasp on my PMs!
I was gonna shut up for tonight, but I couldn't resist this
http://www.contraryinvestor.com/mo.htm"Perhaps it was the NAPM (National Association of Purchasing Managers Index) that pushed the Fed into action. After all, there's nothing like the smell of NAPM in the morning."
These guys are brilliant and they deserve our subscription money when they go "pay-your-way" next week.
WASHINGTON (Reuters) - President-elect George W. Bush's chief economic adviser Lawrence Lindsey said on Saturday the U.S. economy ``is having some trouble,'' and that recent negative economic data underscored the need for Bush's proposed $1.3 trillion tax cut. ``The data we've had this week should erase any doubts in anyone's mind that the economy is having some trouble, that it needs some help,'' Lindsey told the CNN show ``Evans, Novak, Hunt & Shields'' in a taped interview. ``And whatever we can work out to give it the maximum help is what we're for.'' In recent days, Lindsey has hinted that the incoming Bush administration could move up the timing of the proposed tax cut to give the economy a quicker boost. Bush's tax plan calls for the $1.3 trillion in across-the-board cuts to be phased in beginning in 2002. Asked whether the incoming administration wanted to front-load the benefits of a tax cut by reducing the amount of taxes withheld from workers' paychecks beginning in late spring or early summer, Lindsey said, ``We're considering lots of things.'' But one priority should be to reduce the top tax rate paid by the unincorporated business sector, which includes many small businesses, Lindsey said. ``They are being soaked at the highest rate they ever have been. And they have suffered the last eight years as a result,'' he said. White House officials have bristled at suggestions that the economy is headed for a serious slump. But the Federal Reserve Board signaled this week that it was taking seriously concerns about the economy, unexpectedly slashing key interest rates by half a percentage point. Lindsey, a former Fed governor, refused to say whether more interest rate cuts were needed to keep the U.S. economy from stalling. But he expressed confidence in the ability of the Fed to steer the economy. ``Alan Greenspan and his colleagues will do the right thing for America. I'm convinced of that,'' he said, referring to the Fed chairman.
On another economic issue, Lindsey dashed speculation that the Bush administration would not put as much importance on a strong U.S. dollar as has the Clinton administration. ``We believe in a strong dollar,'' Lindsey said, adding that the Clinton administration had made ``a terrible mistake'' by talking down the currency when it first came to office. ``They undermined economies of Southeast Asia as a result. And I think we've all learned a lesson,'' he said.
Black Blade: That last part about a strong dollar and continuing with the status quo does not sound encouraging. Won't make much difference though as it is really out of their hands now. As Larry Lindsey says: the U.S. economy ``is having some trouble.'' Hmmm�
TEHRAN (Reuters) - Iran has said the OPEC oil producers' cartel would decide to cut production by 1.5 million barrels a day (bpd) at its next meeting in Vienna this month, the Aftab-e Yazd newspaper said on Saturday. ``OPEC is determined to cut production,'' it quoted Iran's OPEC governor Hossein Kazempour as saying. ``OPEC...will decrease production at least by 1.5 million barrels a day.'' OPEC will have a full ministerial meeting on January 17 in Vienna to review market conditions and decide production policy. Saudi Arabia, the world's biggest oil producer, said consensus was emerging around a 1.5 million bpd output cut. Kazempour predicted OPEC would slash production by a maximum of two million bpd. Iran is the world's third largest oil producer. He said that if the cartel cut production by 1.5 million bpd at the Vienna meeting, a further cut of 1.5 million bpd might come in the spring, but that if output was reduced by two million bpd at the meeting, a cut of one million bpd would be expected next spring. OPEC, mindful of a price slump two years ago that sent oil plummeting below $10 a barrel, wants to keep prices in a $22 to $28 a barrel band, a level deemed suitable to producers and consumers alike. The fact that oil prices have now bounced back to within the price band would not affect the proposed output cut, Kazempour said.
``OPEC members will not have any doubts about cutting production despite oil prices returning to above $22,'' he said. ''This decision does not contradict with the mechanism approved by OPEC to stabilize oil prices between $22 and $28.''
Black Blade: Today a Saudi official said that it would be more likely that a 2 million/bbl would be agreed upon.
SAN FRANCISCO, Jan 5 (Reuters) - Houston-based Reliant Energy (NYSE:REI) confirmed on Friday it is no longer selling natural gas to California's financially imperiled utilities Pacific Gas & Electric (PG&E) and Edison International. ``We decided in the last two weeks to stop selling natural gas to PG&E and Edison because of their credit-worthiness. We did this purely from a standpoint to protect our shareholders,'' a Reliant spokesman told Reuters. He would not say exactly when the decision was taken nor how much gas the company usually sells to both utilities, which have spent close to $12 billion for buying power but have not been able to recover those costs due to a price cap imposed as part of California's 1996 deregulation legislation. PG&E, a unit of PG&E Corp. (NYSE:PCG), has said 15 to 20 gas suppliers, about one-third of market participants, have so far declined to sell to the utility unless payment is made up front. PG&E, which provides gas to nearly 3.8 million customers in northern and central California, has said it has enough natural gas to supply its customers for January but is uncertain whether it will secure sufficient supplies for February. PG&E's gas needs for February are around one billion cubic feet a day (bcfd), but the company has secured only ``small amounts'' of gas for next month, according to a PG&E spokeswoman, who would not specify how much had already been procured. If the company is unable to secure all of its needs it would likely then be forced to cut some amount of gas service to non-core customers, like industrial users, she said. The needs of core customers, like residential and small business customers, will be met and would only be reduced if service to all non-core customers had been cut and all the gas in the utility's three storage facilities was exhausted, an unlikely event at this time. El Paso Natural Gas (EPNG), a unit of El Paso Energy (NYSE:EPG), and Transwestern Pipeline (TW), a unit of Enron Corp. (NYSE:ENE), both said Friday they have no plans at this time to cut gas deliveries to PG&E but would continue monitoring the utility's financial health, spokeswomen at the companies said. EPNG and TW both supply substantial amounts of gas to PG&E through interstate pipelines in southern California. Southern California Edison (SCE), part of Edison International (NYSE:EIX ), does not not have a gas distribution business, but purchases natural gas to fuel its electric generation plants. SCE could not be reached for comment. Due to exorbitant power costs, PG&E and SCE have said they may not have enough cash to continue operations. And as a result, both have seen their credit standings slashed in the last two days by major ratings agencies.
New York and New Jersey Have Highest Natural Gas Prices Nationwide, According to Platts
NEW YORK--(BUSINESS WIRE)--January 5, 2001--
What: The average price of natural gas in the New York and New Jersey market hit a record of $19.33/MMBtu for January 2001, higher than Southern California, which priced at $16.39, according to data published by Platts, the energy market information division of The McGraw-Hill Companies (NYSE: MHP).
Black Blade: Looks like East Coast Grasshoppers are going to pay up as well! I have info that many east coast nukes are being fired up again to make up for the short-fall. The peoples Republik of Kalifornia shut some nukes a few years ago such as Rancho Seco. They aren't likely to come back on line though. "And the Grasshoppers danced, sang, and played all summer�"
http://www.federalreserve.gov/boarddocs/testimony/19981001.htmThe link I posted was intended to illustrate, by way of Islamic Banking's use of gold, how the value of fiat money is dependent on confidence. If you look around, you will find many diverse sources that cite this factor.
Considering that the price of gold in dollars indicates the level of inflation of dollars, is a viewpoint that does not take into account the alleged manipulation of the price of gold by short sellers, producer hedging, central bank sales, negative press, bull-market enthusiasm for non-material assets, and the influence of futures markets and derivatives. Some may consider that an over-simplification.
In addition to confidence in the sustained value of paper, another related confidence factor is the one described by Alan Greenspan in comments on the LTCM affair:
"Financial markets operate efficiently only when participants can commit to transactions with reasonable confidence that the risk of nonpayment can be rationally judged and compensated for. Effective and seasoned markets pass this test almost all of the time. On rare occasions, they do not. Fear, whether irrational or otherwise, grips participants and they unthinkingly disengage from risky assets in favor of those providing safety and liquidity. The subtle distinctions that investors make, so critical to the effective operation of financial markets, are abandoned. Assets, good and bad, are dumped indiscriminately in circumstances of high uncertainty and fear that are not conducive to planning and investment. Such circumstances, were they generalized and persistent, would be wholly inconsistent with the functioning of sophisticated economies supported by long-term capital investment"
The continued slump in the bullion price is killing off gold prospecting. Last year mining companies spent only $1.1bn exploring for gold, roughly a third as much as in 1997. And for the first time on record gold accounted for less than 50 per cent of their global exploration budgets. New figures from Canadian research firm Metals Economic Group (MEG) show that in 2000 expenditure on gold exploration was just 47 per cent of the total of $2.3bn, whereas in 1997 it was 65 per cent of the much larger total of $4.6bn.* The gold price, which touched $850 an ounce in January 1980, has deteriorated steadily since February 1996 - the last month in which it averaged over $400 an ounce - and it finished last week at $268.
The soggy metal price, plus the Bre-X scandal that rocked the industry in 1997, has made it difficult for small exploration companies to raise money, and hammered share prices. The total market value of junior gold companies fell by 73 per cent to just below $10bn between December 1996 and June 2000. In the last few years many former gold exploration companies have changed their names and switched into businesses, such as dotcom-related activities, where raising money was easier.
Larger gold mining companies were able to buy control of promising prospects found by junior companies relatively cheaply, and so cut their own exploration budgets. In 1999, for example, Barrick Gold, the largest North American gold miner, bought Sutton Resources to get hold of its Bulyanhulu prospect in Tanzania. The falling gold price both reduced the likelihood of finding new prospects which would be worth developing, and scotched some existing developments. Both Barrick and Placer Dome, the second largest North American gold miner, have put once promising and important projects on hold. In mid-1999 Placer mothballed its $575m Las Cristinas mine in Venezuela, and in early December 2000 Barrick decided to delay full-scale construction at the $950m Pascua Lama project on the Chile-Argentine border.
Even some existing gold mines are now barely profitable. In Africa, AngloGold, the largest gold miner, recently sold two high cost mines, Elandsrand and Deelkraal, for $130m to smaller rival Harmony, which specialises in squeezing profits out of marginal mines. As gold's popularity has waned, platinum group metals have become a new magnet for exploration companies. Prices of both platinum and palladium have soared recently.
At over $600 an ounce, platinum is now worth more than twice as much as gold, and sister metal palladium, selling for less than $200 until 1997, was last week flirting with $1,000. Gold Fields, South Africa's second largest gold miner, last year announced a platinum prospect in Finland. And MEG statistics show that the number of companies searching for platinum soared to 64 in 2000, compared with just 38 in 1999. * The strategic report from Metals Economic Group, PO Box 2206, Halifax, Nova Scotia, Canada B3J 3C4.
Black Blade: It's a safe bet that when the POG rises and investment demand increases, there won't be much increase in production from new sources. The lag time from discovery to mine is a minimum of 3 to 5 years. Soon only the best and most nimble miners will be exploring. Another downside is that when the POG rebounds, there won't be many experienced drillers and geologists around as has happened in the petroleum industry. The big fat lazy producers will eat out of their hedge books, and the nimble focused miners will be the discoverers of the new mines of the future.
http://www.lifelinefoods.com/ The best remedy for the "Brown Bottle Flu" is a good night's sleep, a good breakfast, two aspirin, a multivitamin, and a shot of colloidal minerals in a glass of orange or grapefruit juice.
The minerals help with that hangover feeling that all of your bodily fluids have been depleted of their vital life-giving properties. See the link above for the "Buried Treasure" brand that I buy at the local health food store.
HoF Second Auspec
Hi there, also my friend!
I'll forgive you your inattention to celebrate your ingenue's anniversery, if you will forgive me mine with my ingenue's return after an overlong absence. (smarmy grin)
That reply to me was great, but like mine was not a one liner. Still we need more. Everything accepted. Famous one liners of the condemned man facing the firing squad. Preferably apropos the very smelly situation in the market manipulations going on, lo this very week. Best formal one liner to date- Peter Asher- "if I had KNOWN she was a hemophiliac, I wouldn't have bit her on the lip"
Oh yeah, she would make a real good manager. We in Canada had a similiar stint with one of these managers. Her watch lasted days.
What part of the queen mother did you say got snared in the wringer?
I am also happy to go along with the thinking in your 45182, but for slightly different reasons, although I find difficulty in articulating them as well as you did.I second the nomination.
Mr Gresham.
That was a fine roadmap, plainly said.
"that is the money supply" indeed.
A small varience or perhaps a going on record.
My own recent numbers/estimates of the "purchasing power" have run to a fairly significant percentage of the $30,000 mentioned. However it is my forecast that somewhere just north of $800.00 (depending on the exact circumstances) the first step in the attempted save the treasury/confiscation/control, will take place under the facade of the foreign exchange regulations/act. A small wager perhaps? What are my odds for such action, say under $1,000? Could be somewhat less if the action is violent enough.
Large cap Techies are already way past #1, mixed in between
#2 and #3. Dot.coms are in the #3 to #4 range. Once more companies pass #2 and enter #3, #4 becomes inevitable and #5 is simply a function of #4.
A New Twist on Aesop's Fable "Ant and the Grasshopper"
I just heard the results from a poll taken among Kalifornian ants and Grasshoppers. 54% believe that the energy crisis is faked in order to increase electric rates (grasshoppers), 36% believe that their is a serious energy crisis (ants), and 10% not sure (ostriches).
Yeah, electricity comes from the socket in the wall (it's magic ya know), and hamburger comes from McDonald's and not cattle. Fruit and veggies come from safeway and Krogers - not farms, etc. I'm sure that there are other falacies that are taught in the public schools - maybe others here at the forum know a few. A rude awakening is about to occur!
SEOUL South Korean stock investors are taking a shine to gold - or at least to companies that claim to have found it. First there was Dong-Ah Construction Industrial Co., whose shares surged by their daily limit for 17 days in December after reports that the company had stumbled upon evidence of a sunken Russian warship laden with gold.
.
Now comes another lucky prospector, Hyundai Corp. Its shares surged by their 15 percent limit for the second day in a row Friday after the company claimed it had struck gold in Mali.
.
Just how much of the precious metal there is, is open to question. The Yonhap news agency reported speculation of a deposit as large as 300,000 tons in the West African country. That would be more than twice all the gold ever dug out of the Earth.
.
"No way there is a deposit as big as that," said Joachim Berlenbach, an analyst at ING Barings in Johannesburg. "Mali has been quite well explored, and a big deposit would have been long found."
.
Even Hyundai said it could not confirm the amount. "We have yet to finish our preliminary studies," said Lee Hong Jae, a company spokesman.
.
Such vague talk failed to cool enthusiasm for the trading arm of Hyundai Group, a once-powerful conglomerate that is now scrambling to sell assets to bail out its ailing construction unit.
.
Hyundai Corp. rose 195 won Friday to finish at 1,525 won ($1.21).
.
Gyrating stocks are not rare in South Korea, where the benchmark index is among the most volatile in the world. The KOSPI index has a 90-day annualized volatility of 47.5 percent. That suggests that if movements follow the same pattern as they have in the past three months, the index could be 47.5 percent higher (or lower) in the months to come.
.
And for the past month, it has been gold that helped some nervy investors forget that the KOSPI lost half its value in the past year.
.
Dong-Ah, a bankrupt contractor, finally fell Friday, tumbling 15 percent. Its first decline since Nov. 30 still leaves the shares up about 10 fold since reports surfaced that the company had found the wreck of the Dmitri Donskoi, a frigate scuttled in 1905 in the Sea of Japan.
.
"Investors, especially those who tend to invest in stocks like Dong Ah, tend to ride the wave of popular themes," said Yoo Young Kuk, a strategist at Hanyang Securities Co. "They're sensitive to what's in and what's out." Hyundai is definitely in, for now, even though gold is trading around $269 an ounce, a 28-year-low after adjusting for inflation. The company said Thursday that it had struck gold in the Malian town of Barani.
.
Though Mali is a plausible site for a gold discovery - gold accounts for a tenth of the gross domestic product - miners have not had an easy time there.
.
Randgold Resources Ltd., a group that does mining exploration in sub-Saharan Africa, said in November that its Syama mine in Mali may be forced to close soon if the company is unable to invest as much as $40 million to extend the mine's life to 2006.
.
The company, controlled by South Africa's Randgold Exploration Ltd., has asked the Malian government to waive taxes and royalties.
For Related Topics See:
Business
< < Back to Start of Article SEOUL South Korean stock investors are taking a shine to gold - or at least to companies that claim to have found it. First there was Dong-Ah Construction Industrial Co., whose shares surged by their daily limit for 17 days in December after reports that the company had stumbled upon evidence of a sunken Russian warship laden with gold.
.
Now comes another lucky prospector, Hyundai Corp. Its shares surged by their 15 percent limit for the second day in a row Friday after the company claimed it had struck gold in Mali.
.
Just how much of the precious metal there is, is open to question. The Yonhap news agency reported speculation of a deposit as large as 300,000 tons in the West African country. That would be more than twice all the gold ever dug out of the Earth.
.
"No way there is a deposit as big as that," said Joachim Berlenbach, an analyst at ING Barings in Johannesburg. "Mali has been quite well explored, and a big deposit would have been long found."
.
Even Hyundai said it could not confirm the amount. "We have yet to finish our preliminary studies," said Lee Hong Jae, a company spokesman.
.
Such vague talk failed to cool enthusiasm for the trading arm of Hyundai Group, a once-powerful conglomerate that is now scrambling to sell assets to bail out its ailing construction unit.
.
Hyundai Corp. rose 195 won Friday to finish at 1,525 won ($1.21).
.
Gyrating stocks are not rare in South Korea, where the benchmark index is among the most volatile in the world. The KOSPI index has a 90-day annualized volatility of 47.5 percent. That suggests that if movements follow the same pattern as they have in the past three months, the index could be 47.5 percent higher (or lower) in the months to come.
.
And for the past month, it has been gold that helped some nervy investors forget that the KOSPI lost half its value in the past year.
.
Dong-Ah, a bankrupt contractor, finally fell Friday, tumbling 15 percent. Its first decline since Nov. 30 still leaves the shares up about 10 fold since reports surfaced that the company had found the wreck of the Dmitri Donskoi, a frigate scuttled in 1905 in the Sea of Japan.
.
"Investors, especially those who tend to invest in stocks like Dong Ah, tend to ride the wave of popular themes," said Yoo Young Kuk, a strategist at Hanyang Securities Co. "They're sensitive to what's in and what's out." Hyundai is definitely in, for now, even though gold is trading around $269 an ounce, a 28-year-low after adjusting for inflation. The company said Thursday that it had struck gold in the Malian town of Barani.
.
Though Mali is a plausible site for a gold discovery - gold accounts for a tenth of the gross domestic product - miners have not had an easy time there.
.
Randgold Resources Ltd., a group that does mining exploration in sub-Saharan Africa, said in November that its Syama mine in Mali may be forced to close soon if the company is unable to invest as much as $40 million to extend the mine's life to 2006.
.
The company, controlled by South Africa's Randgold Exploration Ltd., has asked the Malian government to waive taxes and royalties. SEOUL South Korean stock investors are taking a shine to gold - or at least to companies that claim to have found it. First there was Dong-Ah Construction Industrial Co., whose shares surged by their daily limit for 17 days in December after reports that the company had stumbled upon evidence of a sunken Russian warship laden with gold.
.
Now comes another lucky prospector, Hyundai Corp. Its shares surged by their 15 percent limit for the second day in a row Friday after the company claimed it had struck gold in Mali.
.
Just how much of the precious metal there is, is open to question. The Yonhap news agency reported speculation of a deposit as large as 300,000 tons in the West African country. That would be more than twice all the gold ever dug out of the Earth.
.
"No way there is a deposit as big as that," said Joachim Berlenbach, an analyst at ING Barings in Johannesburg. "Mali has been quite well explored, and a big deposit would have been long found."
.
Even Hyundai said it could not confirm the amount. "We have yet to finish our preliminary studies," said Lee Hong Jae, a company spokesman.
.
Such vague talk failed to cool enthusiasm for the trading arm of Hyundai Group, a once-powerful conglomerate that is now scrambling to sell assets to bail out its ailing construction unit.
.
Hyundai Corp. rose 195 won Friday to finish at 1,525 won ($1.21).
.
Gyrating stocks are not rare in South Korea, where the benchmark index is among the most volatile in the world. The KOSPI index has a 90-day annualized volatility of 47.5 percent. That suggests that if movements follow the same pattern as they have in the past three months, the index could be 47.5 percent higher (or lower) in the months to come.
.
And for the past month, it has been gold that helped some nervy investors forget that the KOSPI lost half its value in the past year.
.
Dong-Ah, a bankrupt contractor, finally fell Friday, tumbling 15 percent. Its first decline since Nov. 30 still leaves the shares up about 10 fold since reports surfaced that the company had found the wreck of the Dmitri Donskoi, a frigate scuttled in 1905 in the Sea of Japan.
.
"Investors, especially those who tend to invest in stocks like Dong Ah, tend to ride the wave of popular themes," said Yoo Young Kuk, a strategist at Hanyang Securities Co. "They're sensitive to what's in and what's out." Hyundai is definitely in, for now, even though gold is trading around $269 an ounce, a 28-year-low after adjusting for inflation. The company said Thursday that it had struck gold in the Malian town of Barani.
.
Though Mali is a plausible site for a gold discovery - gold accounts for a tenth of the gross domestic product - miners have not had an easy time there.
.
Randgold Resources Ltd., a group that does mining exploration in sub-Saharan Africa, said in November that its Syama mine in Mali may be forced to close soon if the company is unable to invest as much as $40 million to extend the mine's life to 2006.
.
The company, controlled by South Africa's Randgold Exploration Ltd., has asked the Malian government to waive taxes and royalties. SEOUL South Korean stock investors are taking a shine to gold - or at least to companies that claim to have found it. First there was Dong-Ah Construction Industrial Co., whose shares surged by their daily limit for 17 days in December after reports that the company had stumbled upon evidence of a sunken Russian warship laden with gold.
.
Now comes another lucky prospector, Hyundai Corp. Its shares surged by their 15 percent limit for the second day in a row Friday after the company claimed it had struck gold in Mali.
.
Just how much of the precious metal there is, is open to question. The Yonhap news agency reported speculation of a deposit as large as 300,000 tons in the West African country. That would be more than twice all the gold ever dug out of the Earth.
.
"No way there is a deposit as big as that," said Joachim Berlenbach, an analyst at ING Barings in Johannesburg. "Mali has been quite well explored, and a big deposit would have been long found."
Note: Just another attempt to relegate gold to be as common as household salt in order to contain its price.
How many of you think Bre-X was a planned coup against the gold industry? Raise your hands. (...it worked didn't it?)
Calif. scrambles for answers to power crisis Mark J. Terrill, AP
SACRAMENTO, Calif. (AP) � Faced with a deepening electricity crisis, state officials are weighing some drastic proposals, ranging from a public takeover of the entire network to a crash construction program for new power plants. The state's two largest utilities are already $9 billion in debt and are losing an estimated $40 million each day because of wholesale price spikes. Both have said they'll face bankruptcy in a matter of weeks if nothing is done.
(Crash construction program! I guess in LaLa land, all they have to do is wiggle their noses, and poof, an environmentally perfect power generating plant springs up)
''At its core, you're looking at a catastrophic power shortage. That means you either ration by high prices or you ration by rolling blackouts. There is no third choice,'' said Republican state Sen. Tom McClintock.
(I didn't realize that any republicans were allowed to hold office in LaLa land. Brave soul, speaking common sense.)
Others disagree that a power shortage is the root problem, some blame the state's recent power deregulation and high wholesale costs, but most concur that time is running out for the utilities to remain solvent.
(Deregulation, my butt)
The Public Utilities Commission on Thursday approved rate increases of 7 to 15% for Pacific Gas and Electric Co. and Southern California Edison Co. But the utilities, which serve 25 million people, said the increases weren't enough. Wall Street agreed, and the major credit rating agencies sharply downgraded both utilities.
The focus on solutions has turned to Gov. Gray Davis and the Legislature.
(Better get yours nose wiggling Gray, or you're going to be a one term wonder)
The governor is ''considering all the options,'' said Davis spokesman Steve Maviglio. Davis is expected to discuss his proposals in his State of the State speech Monday, but administration officials say he will likely focus on conservation and financial incentives for power plant builders rather than price controls, re-regulation or public ownership of the grid.
(Somehow, I think "all the options" won't include common sense options. I sense the heavy hand of government.
The more dramatic proposals are coming from the Legislature.
McClintock favors spending $5 billion of the state's surplus on rebates to consumers, but that proposal has drawn little support.
(Can't be giving those tax dollars back, no way)
Democratic Assemblyman Fred Keeley has suggested spending $3 billion to buy hydroelectric power plants, then operate them under contract with the utilities. It would let the utilities get cheap power and avoid high wholesale prices on the open market, he said.
(I thought that there was a drought situation, that in part, has led to this overall problem. And just how many hydro plants are up for sale anyway?)
State Treasurer Phil Angelides has proposed a $10 billion plan to create a state agency to build and run power plants, own the distribution lines and use the power of eminent domain to seize plants in an emergency. However Republicans view Angelides with suspicion and Democrats don't have the necessary two-thirds majority to approve money for such proposals.
(Seize plants? Who in their right mind would want to build in the future, knowing this was hanging over their heads?)
Since late spring, PG&E and SoCal Edison have lost more than $9 billion because of soaring prices for wholesale electricity and a state-imposed rate freeze that prevents them from passing the costs on to customers. That, in turn, affects their ability to borrow money to buy power to avert blackouts.
(As I stated above, deregulation, my butt)
Wholesale prices have risen because of increased demand during the hot summer and cool winter and, some state officials say, because of profiteering on the part of wholesalers.
(No mention as to the stupidity of the politicians, or the power of the environmental wackos)
At the same time, the state's electricity reserves are stressed. A large number of power plants are down for maintenance, and imports are tight because nearby states are competing for power.
Nine new major power plants are licensed in California, but the first two won't go into operation for another year
(At least they won't freeze to death, blessed with temperate climate)
1.4 billion ounces of gold is presently held by the CB's. 130 million ounces changes hands daily on the LBMA. It takes 11 working days for the total world gold to clear the amount of gold equivalent to all Central Banks holdings on the LBMA. These huge volumes on the LBMA are not from hoarders. These are the merchants of credit creation using gold as a currency for credit creation. What these credit merchants are saying is that gold is money and paper is not. They are saying that paper money is debt.. and debt is paper money. It is the LBMA that values credit creation gold at $3,000 and commodity gold at $270. BIS does not even do .01% of the business LBMA does. However LBMA uses BIS to do some of its business and store some of it's gold. GATA is going after the wrong people. It is LBMA who wants to buy the private share holders out at BIS. LBMA keeps the price for commodity gold as low as possible in order to profit from the difference between commodity gold and credit creation gold. BIS is the Central Banks bank when it comes to settle trade deficits among nations. For the year 2000 USA trade deficit was settled at BIS in gold at a price of $526. Greenspan is NOT a member of the LBMA. That $526 gold price is not determined by BIS but is determined by LBMA. In a sense England still controls USA + Canada. Clinton is an Oxford educated and his oath of office is the British Crown not the United States of America. So is former Treasury Secretary Rubin. For the record the Bush Family Trust is in England under the laws of the British monarchy. Our gold money is replaced by promises to pay. Our system of exchange is dependent on those promises which are created by the credit creation merchants of the LBMA. -- ASK your elected representatives two questions- 1 What price does credit creation gold change hands? + 2 What price is the USA trade deficit settled at BIS? You should ask a 3'd question= Why is commodity gold priced different from credit creation gold?
www.kitco.comDate: Sun Jan 07 2001 09:25
G.SANDRO (forevergold) (Here's the text about the law suit that has been posted to many European newspapers and press ) ID#397149:
Copyright � 2000 G.SANDRO (forevergold)/Kitco Inc. All rights reserved
agencies.
You also have to know that the world famous"Der Spiegel" is speaking about it and that AFP ( the most famous french pess-agency has already send a communiqu� about it ) . We are some french Goldbugs who wanted to contribute ( with our small means ) to this histoical fight...
GO Reginald, GO GATA, GO Silver, Go GOLD...!!!
Madame, monsieur;
Vous assumez la noble, mais d�licate, t�che consistant � INFORMER vos lecteurs.
Un �v�nement majeur s'est produit le 07/12/2000...d�j� un mois...
Or,pour l'heure, personne de ce c�t�-ci de l'Atlantique n'en a encore fait �tat...
Ce mail va �tre envoy� simultan�ment � vos principaux confr�res//concurrents...
La presse Anglo-Saxonne est d�j� inform�e et ne devrait pas tarder � s'emparer de l'affaire. L'AFP vient de s'en saisir.
Une initiative in�dite vient d'�tre entreprise par Mr Reginald HOWE. Relayant la d�marche du GATA ( Gold Anti Trust Action ) qui avait remis, voici quelques mois, un volumineux rapport aux parlementaires am�ricains pour d�noncer les manoeuvres plus ou moins licites qui ont ( auraient ) �t� op�r�es par de prestigieuses institutions financi�res dans le but de faire baisser artificiellement le prix de l'OR.
Cette initiative avait fait"les choux gras"
de vos homologues dans de nombreux pays, mais le silence la concernant avait �t� assourdissant dans notre douce France.
Mr Reginald Howe a saisi la justice Am�ricaine pour les m�mes motifs. Il avance un nombre impressionnant de preuves de la "conspiration" en cours depuis cinq ans.
Cette plainte n'est pas port�e contre X; elle vise rien moins que le Chairman de la FED :Mr Alan GREENSPAN Himself...
Au nombre des mis en cause, on d�nombre aussi le secr�taire au Tr�sor: Mr Larry Summers, La BRI ( Banque des r�glements internationaux ) qui n'est autre que la Banque Centrale des Banques Centrales...
Mais aussi, et entre autres St�s; JP MORGAN, GOLMAN SACHS, DEUTSCHE BANK...etc...
Comme vous le voyez,tant le caract�re in�dit de ce que de nombreux observateurs n'h�sitent pas � qualifier de "l'un des plus gros scandales financiers du si�cle" que l'importance des personnalit�s et des institutions mises en cause justifient amplement que vous enqu�tiez pour en rendre compte � vos lecteurs...Il en va de votre cr�dibilt�.
Quel sera le premier journal francophone � en faire �tat? Si ce n'est le votre, ce sera celui d'en face.
Vous trouverez toutes les informations et confirmations sur les sites web dont la liste suit:
WWW. Golden-sextant.com
WWW. Gata.org
WWW. Gold-Eagle.com
WWW.contrary-investor.com
Vous trouverez ,ci-dessus, de nombreux liens vers des articles qui devraient titiller votre curiosit� professionnelle et votre d�ontologie....
Good article. Amazing that Gray Davis was being touted as a possible Democratic candidate for president in 2004. How the fortunes of politics change. This energy crisis is likely to blow up very soon and the markets will continue the long see-saw slide into oblivion as investors lose it all. The question now is can George Dubya hand off this hot potato to Bubba before he skips town, or will he be stuck with the "Herbert Hoover Legacy?" It should be quite entertaining as the politicos do their damnedest to grow a skin of teflon.
These people (grasshoppers, as BlackBlade labels them) have far to many fluffball things to occupy their time. "Abstract", how fitting.
I guess that when those blackouts hit, reality may set in. (and note, I used the word "may")
Gray's approval numbers look like they are already getting hammered.
Black Blade: I thought that I would help you out a little, as from the times of your posts, you might need a little nap. Thanks for the yeomans job you have been doing, it is greatly appreciated.
Any More Seconds For HOF?? I have taken the liberty of reposting Mr.Gresham's "Squeeze Is On" from yesterday as it is an exceptional piece. Looking for at least one more second for HOF consideration, with supporting rational preferred. This post is an excellent example of using interesting analogies to get a point across. It fits somewhere between the "Big Boy" HOF and the CLHE-HoF, and my guess is that Mr. G may eventually end up with articles in both esteemed sites. That is, if he hasn't used up all his "silver bullets"! END/THANKS Auspec
Mr Gresham (1/6/2001; 1:00:31MT - usagold.com msg#: 45146)
AG and Payments System: Squeeze is On
I guess I should put it up top: This is the way I see the FOA gold rocket-price scenario happening. Combination of Fed "printing", public "flocking" and "fleeing", and ECB "re-balancing" reserves. It's hard to see $30,000, no matter how much of the above occurs; hard to see that something else wouldn't siphon off those $ somewhere on the way to that, but none of us really NEED that number just now except as an attention-getter, right? Somewhere around $1000 or $2000 (very explainable) we'd be getting "the rest of the story" from FOA & ANOTHER, and making our judgments from there.
AG and Payments System: Squeeze is On
In the interviews with Greider and others for their books on the Fed, Greenspan and Volcker have emphasized that their concern has been with preventing a breakdown in the payments system between financial institutions (US & worldwide). They couldn't guarantee which way markets would go, but they wanted to be sure that the winners and losers could settle their deals quickly and finally in USD, and move on to more commerce.
The Fed acts to stand behind institutions with the required capital levels so that they are not driven over the brink by interruption of payments from less-solvent counterparties. In one instance during Volcker's reign, the breakdown ("Herstatt Risk" from an early-70s European crisis) was somewhat threatened by the different clearing times between US and European banks. I think one system had three-day, the other five-day clearance, and that difference would have left some banks gasping for liquidity for a fatal 48 hours. The Fed and other CBs had to tide over that difference during a cash flow crunch.
Many of AG's speeches have been about technical improvements in the payments system, so that a glitch seemingly far-removed from the basic business solvency of the transacting institutions (which are playing brinkmanship enough as it is) does not bring down the system. "Cascading cross-defaults" I think was his phrase.
We get a whiff of that anytime a major bank or other institution is threatened with capital insolvency. The memory of Continental Bank, which was cleaned out by foreign overnight wired withdrawals nearly 20 years ago, must still be in the minds of some today.
Picture the money supply as somewhat concentric rings of asset types, perhaps akin to Dante's rings of Hades?, or the electron rings of a highly agitated atomic particle. At the outermost levels are the "flakiest" of funny moneys, but they exist because people can play with them in certain ways they can't with the more stable moneys toward the center. (Can you Goldhearts guess what these might be?) The players are willing to accept higher risk to attain their ends of greed and excitement, though their risk/reward calculations have been actually been lousy if done at all and their information inputs inadequate.
They analyze their transactions on a two-dimensional map of risk/reward considering only market directions and maybe the psychology of counterplayers. They do not question the third dimension which, from an elevated perspective, says that the chessboard they are now winning upon can at any moment be swept clear by the hand of market breakdown and payments system collapse.
The US money supply today might be, for example, $7 trillion of all types (honest, I haven't looked this up, and don't care to research harder toward some useless specificity.) But this money supply represents debt of all types that people and institutions have committed themselves to work toward repaying, circumstances permitting. (Subject to many ways of discounting in future.) It represents paper currency that people commonly accept as money. And it represents real assets that can be used as money, or act as direct backing for a currency money.
Suppose that those categories boil down, in an economic "hard landing" scenario, to only $2 trillion of "hard" money. Money that really will be trusted in use, debt that will be worked down to sustain homes, businesses, and credit ratings. Right now, the public is looking toward the $7 trillion "mountain" of money that they've always known (and still remember from its smaller and less-flaky days). Right now, they believe that by working harder and smarter, a piece of that big mountain is to be theirs. A shift in psychology later, they turn around and see instead the smaller "hill" of $2 trillion. And, voila!, THAT becomes the real money supply, either very immediately, or eventually, after a longer and still-painful workout.
If that is what people believe is out there, then that is what they are willing to supply their labor and capital to work toward. That is THE Money Supply.
Alan Greenspan's problem with the Bubble is that its puncture immediately puts the smaller amount on peoples' credulity screen. All the funny money in various way-out orbits -- whether created by flicks of the fickle Fed fingers, or by a lifetime of self-denying savings -- flees toward the stable center when it is threatened, but like the crowded theatre on fire, the doorways are not wide enough. The available niches for more stable money in closer levels are fewer and cannot readily accommodate the flood of scared money. Much money, both borrowed and saved, departs for Money Heaven (where streets are paved with fiat.) Of course, back on Money Earth, prices rise for items representing the more stable money items.
In market Technical Analysis terminology, there is not much "Support" between $7 trillion and $2 trillion. Most "buyers" of money ("suppliers" of labor) will sit out the market slide as able, once their expectations shift, and they will thereby produce a bottoming out of the supply/demand equilibrium at a new low, but supportable, level. They will not bid their hard labors for the outer, flaky (mostly departed or soon to) moneys anymore but for the nearer to hand, harder, trusted moneys. Newly risk-averse, the cycle will funnel more of the remaining $2 trillion toward gold and assets near its central orbit of stability.
Of course, economic activity, statistically-measured, slows to a crawl as people re-jigger their ideas of what is worthwhile spending their now poorly-paid labor and dwindling cash upon. The Depression scenario, scary as it may be, may cause many people to repeat what was said in an earlier time: "We had everything in those days, except money." Learning about values never ceases; money is just the warm-up.
The payments system is the artery through which trillions of dollars flow daily or weekly, and upon the constriction of those vessels, the economic "lifeblood" flowing will reduce to the lowest practical and supportable amount. Institutions will simply not hang out their entire corporate capital on a transaction or two, when a new "Creditanstalt" or "Herstatt" has occurred and more are waiting to happen, unknown which ones among all their routine transactions. This is how the payments system dies, regardless of Fed and CB backing. Even the Lone Ranger can fit only six Silver Bullets in his pistol.
Greenspan simply does not want the statistical implosion of the money supply to happen on his watch. He does not consider it inevitable, and believes that the Art of Fed Chairmanship, aided by public psychology, has a spitting chance of turning it back, or landing it "softly". If he fails, his consolation prize would be history granting that he "did his best, in an impossible situation," quite a re-write in itself. (If the camera is focused only upon the post-Crash period, though, he may get away with it. Awww, let him.)
But, as he has pushed back each harbinger or lesser trigger of that implosion, he has aligned all of the disparate elements in a grand conjunction, a parting of the economic Red Sea (in which his own chariots must perish), and the almost meticulously calculated as-if-planned Perfect Storm that will fall upon the economy with full fury and spare no frivolous item of economic waste from dissolution.
Robin (Who has a pass code here) Just now said "Clinton will go down in history as the man who re-invented the Presidency" she then had him saying the following one-liner --"Presidency? Presidency? I thought you knew; I wanted to be King!"
What age is it {emotionally/maturity} that most kids quit biting?
Regarding the Queen Mommy- I understand her next mammogram will entail a 50% fee reduction!
You have my permission to use the posts and show them to the media friends. Especially my last one. It has been my experience that the Wall Street Journal, Investor's Business Daily and others do not want their subscribers know the truth. Matter of fact of all the information I send them- they may very well be the ones that turned me in. These papers are Wall Street owned and it is in their interest to keep this ponzi scheme going for as long as possible. This ponzi equity market can only work as long as more money flows into this con game. I can proof with documented information from the Bank of England that the credit creating gold sells for at least $3,000+ and not more then $34,000 per oz. Presently the gold price would have to increase to $34,000 to back the dollar currency with gold. That the gold used for trade deficit settlement is above $500 I got from BIS.---- Canuck on your post on public debt-'Does the Bureau of Public Debt include the cost of future Social Security obligations Clinton already used to reduce debt? Does it include the cost of Treasury Debt Clinton purchased with gold the ESF does not have. This gold short position will have to be covered by ordinary people's gold at the commodity price not LBMA's credit creation price. Round 2 of gold confiscation is around the corner. Today any one that is invested in today's stock market, especially gold stocks and dot.com stock you are the victim of the biggest ponzi scheme ever orchestrated in the history of mankind. Durin the crash of 29 there was plenty of land to start over. During the next crash land avaiability goes to those who can pay for it.
Twas the day after Christmas and all through the house,
every creature was hurting, even the mouse.
The toys were all broken, there batteries dead;
Santa passed, with some ice on his head.
Wrapping and ribbons just covered the floor,
while upstairs the family continued to snore.
And I in my T-shirt , new Reeboks and jeans,
Went into the kitchen and started to clean.
When out on the lawn there arose such a clatter,
I sprang from the sink to see what was the matter.
Away to the window I flew like a flash,
Tore open the curtains and threw up the sash.
When what to my wondering eyes should appear,
But a little white truck with an oversized mirror.
The driver was smiling, so lively and grand;
The patch on his jacket said U.S. POSTMAN
With a handful of bills, he grinned like a fox,
Then quickly he stuffed them in our mailbox.
Bill after bill , they still came.
Whistling and shouting he classed them by name;
Now Dillard, now Broadway, now Penny's and K-Mart,
Here's Robinsons, Levi's, and Targets and Wal-Mart.
To the tip of your limit, every store every mall,
Now chargeaway- chargeaway -chargeaway all!
He whooped and he whistled as he finished his work.
He filled up the box, and then turned with a jerk.
He sprang to his truck and he drove down the road,
Driving much faster with just half a load.
Then I heard him exclaim with great holiday cheer,
ENJOY WHAT YOU GOT
YOU'LL BE PAYING ALL YEAR!!
Mr G. I'm having a bit of trouble following just what exactly you are saying as to the (Fiat) money that makes up the supply. You seem to be referring as the "outermost rings" as being derivatives and other speculative instruments that are contracts rather then money. Please correct me if I am mis-interpreting. Some labeling and quantification would help.
My perception of The total Money Supply is that of cash, demand deposits and any other instrument that is redeemable at some point for the amount of cash that was put into it. Anything that has to sold into a fluctuating market should be seen as a contract, acknowledging money parted with, that must be bartered back into cash in a Bid/Asked, trading marketplace.
Money may ENTER the system via securities as in T-bonds but once loose in the land it circulates from hand to hand until paid back to into the books of the Fed. The money goes from the Fed to the Government allocators and then into the hands of the makers of U-235 bomb casings, Ritalin for grade-schoolers , and some petty cash to fill potholes on the Interstates. From there, the renderors of those endeavors use the buying power to make their claims on goods and services and so the Totality keeps changing hands while along the way someone may retire some debt while simultaneously others are acquire more.
When you say:--- "flakiest" of funny moneys, but they exist because people can play with them in
certain ways they can't with the more stable moneys toward the center. The players are willing to accept higher risk to attain their ends of greed and excitement," ---(Derivatives?) you are describing the most nebulous of assets, having only real value at any particular moment in time that they entitle their holder to a price on the profit side of the strike.
This vision of contracts as money is a constantly re-occurring theme on the Forum that keeps popping up like a Hydra heads. Stranger took a couple of good sword-swipes in---
TheStranger (01/04/01; 20:29:01MT - usagold.com msg#: 45063)
There is no way I can think of to take one's money out of the market without getting someone else to put an identical amount in (Asher's Law). The effect on the money supply of all this selling, therefore, is net zero, unless you know something I don't.
TheStranger (01/04/01; 21:44:01MT - usagold.com msg#: 45073)
I hope my posts #45063 and especially #45065 take care of your question. I just went
through all the numbers and I think I am getting this right, despite what you may be seeing
elsewhere. Money simply can't just come out of the market, mutual funds or otherwise. Every
share sold has to be bought by someone else.
Fiat money is precisely: A record of entitlement to goods or services within the economic system wherein it is legal tender! Behind the occluding curtain of monetary theology, these rights are specifically obtained by delivering goods or labor, by making a commitment to do same at a future date, by being appropriated by government from one who has them and given to another (Welfare) by being won from another (Market trading) or just plain stolen outright.
Within the system of any nations money supply, the "value" of money is always a function of supply and demand. (Between competing nations supply/demand is co-mingled with currency trading fluctuations., but that's a digression for another post.) When a provider of natural gas gets more money for his MBTU he has acquired a larger share of buying power and the consumer who transferred it to him has less. Walmart will lose some sales and perhaps Cadillac will gain one. Any given amount of money supply is always in someone's hands as a purchasing right. What it will obtain at any given moment is the subject of the "Great �Flation Debate."
What I wanted to do here was draw attention to the difference between paper contacts that can be traded for (Fiat) money and specific money itself.
If time permits?Would you revisit a post you made long ago as to how JP Morgan (I believe)used David Walsh and Bre-X to it's own ends....I personaly believe this was the beginning of the 'War on Gold' to further the "Sting"......Thanks...YGM.
I can not take credit for " The day after Christmas"
I do not know who the author is.
I read it in a newsletter from a Georgia Prospecting club I belong to.
There is no authors name on it. I thought all here would enjoy it as I did.
Has Europ reached its limits of wealth-creation, through social welfare ? What are the limits of deficit spending?
Is good + bad credit in balance with tangible assets ?
These stupid questions date from the time when we tried to live with the Gold Standard. Today, Europ is living on a broad, super-high, standard of living. Consumption-slavery, still going strong. Increased acceptance of refugees of all sorts. A fundamental confidence in this deficit machinery, is creating a totally complacent society. A consensus-economy-model is backing the welfare state. And it works.
Is this the right environment for accumulating Gold? For the vast majority...the answer is : NO
They don't even consider it. I have the strong impression that the European situation is quite different from the US.
Europeans have substantial savings. National debts, stopped increasing at previous speeds. There are no sounds of any alarmbells in neither 12 member states. We are happy with the US$ and POO as it is today. Stockmarket valuations never reached mania levels and no schocking, distorting bancruptcies.
I don't know if one can conclude that Europ is a safe haven.
We don't have any www. bearsites to open the eyes. The Euro/POO blip, hasn't disturbed the consumption-force. (so far). Europ as Midway between US and Japan. Is Europ and the Euro, the balance-pivot between the 2 other super powers ?
If so, what will be the consequences for the capital flows in case of a US/Japan debacle ?
I have no idea, how much dollar exposure we have in Europ.
At what point shall Europ (and Japan), repatriate its dollars from the US ? Is a possible dollar-debacle, avoidable through inter-government agreements. The US keeps on preventing a Gold-flight and keeps its borders open for trade on condition of a stable dollar. Geopolitics in confrontation with the debt-spiral.
Will Europ's stability (?) be at the US/Japan's convenience?
And what will Europ get in exchange for that stability factor ? How much dollar-decline + debt is Europ and Japan, ready to swallow, before they stop being convenient ?
POO > 40$ ? Dow break under 10.000 dam ? US$-index plunging under 105/100 ? Panic fifth wave down in stockmarket ?
US$-interest rate (up)swing ?
I am searching for the ultimate gold-rush event. A macro-economic shock that burns the complete paper-gold-mountain away for the return to physical gold. The japan debacle never resulted in a goldrush. Europ, never had a fundamental reason to hide in gold for the long run. So we are left with the US Debt monster. And it is the US who manages to avoid a goldrush.
What is US-Funds holding from investing in gold ? A profit opportunity in an increasing Euro ? A profit in Bonds with declining interest rates ? Or is Everybody shorting Everything ? Where are the Trillions, saved from stockmarket decrease, flowing too ? Out from Nasdaq to Dow-growers ? Euro-earners ?
General Electric has given a clear down signal...a precursor for the Dow's fate ? At what point does a interest rate hike has to come to save the weakening dollar ? Why don't, the goldfunds, start to yell for goldaccumulation ? Don't they see the shadow of the panic-wave in equities, bonds and currency ? Yep, it must be Denial !
Early last year you wrote that the Russians would be revaluing gold early in 2001 to either $2,000 or $3,000 (I forget which one you said). Would you mind "revisiting" this item and telling us whether it will indeed happen this year?
Difference between commodity, trade settlement and credit creation gold.
Commodity gold price = the controlled price of gold traded for every day people. LBMA who may very well be in control of Goldman Sachs and others like Chase etc because of their gold short position use them to regulate or control the commodity price of gold in order to control the flow of gold to individuals. By keeping the price of gold low the demand for gold to individuals keeps hitting new lows. Most every day people consider gold junk. If the price moved to lets say $800 more money would move into gold and gold would not be looked upon as junk. Present Commodity price is in the $270 area. -- Trade deficit settlement gold is gold the USA uses to make good its trade deficits. Here the USA buys commodity gold for $270 and trades (barter) that gold for $526 to reduce trade deficit account. $526 is the average price for the year 2000 gold price used to reduce trade deficit account. It's not fixed- and I have no idea why at that price. Ask Greenspan, he is the one to explain it so everyone can understand not. -- Credit creation gold is gold central banks use to create credit. 1 oz., of gold worth $270 in commodity form is worth $3000+ as backing for writting credit instrument. Most of Greenspan's cronies are the very people in charge of the biggest Hedge Funds. Most of the 12 Central Banks that make up the FED are Hedge Funds themselves. According to the Bank of England the underground free market price for gold moving from England to America or back is at the credit creation gold price of $3000+. By limiting or regulating (controlling) the commodity price less new gold comes from the ground to compete with the credit creation gold. If commodity gold was $1000 everyone would be digging for gold including the Russians. The powers to be have the above ground gold in their hands and they want the power to create credit to come from their own hands. The FED is owned by the Rockefeller Foundation, Euro is owned by another group (foundation) and the Bank of England is owned by another group who want the right to create credit. It is a rich family thing. If poor me did it I would be counterfeiting. Credit creation is usury which is a factor which makes a contract illegal because the interest due on that loan (credit instrument) is never created. When you make out a loan the bank does not give you the money needed to pay interest. You or someone else has to borrow that money into existence. There is no other source of money except to borrow it into existance. However the illegal contracts need a court decision to rule it illegal. Financial slavery is still legall. Hillary, Jon Corizone (SP) and many other have been able to buy their election by using commodity gold and turn it into credit creation gold worth far more then commodity gold. There is no physical difference between commodity gold or credit creation gold. IT IS WHAT YOU DO WITH IT. You have three choices. Sell it as a commodity, use it as trade settlement, or create credit with it by leasing (sell) to yourself the same gold over and over again to create credit. -- There is a part here I can not explain without getting killed so i will leave it out.
Gold moving to the EAST- Russia is buying commodity gold
Russia is defaulting on its IMF debt and forcing IMF to loan them more money to default on. It has exchanged part ownership for Euro debt (mostly German debt). The idea of part ownership is to get help both in operation and financial to run its industry from Europeans. The oligarchs all have accounts at Goldman Sachs and Putin wants most of these oligarchs dead. Oligarchs are the ones who made possible the movement of Russian gold to the west that Bank of England is Auctioning off. Putin is using the IMF money to buy gold. When the time is right he will revalue it and back the ruble with gold. He wants to control what once was known as the USSR. His plan is to drive the gold backed ruble drive the Oligarchs bad $'s out. Right now I feel 2001 is to early, however the ruble is gaining strenth and some of the Oligarchs are dead and whatever they owned or controlled is now back in Putin's control. Putin is making a lot of progress and will use all loan money gained from the IMF to buy gold. From here on out the IMF will have to loan Russia money in order to get paid for the previous loan with some money more money to buy gold. Russia has a balanced buget by defaulting on the IMF loans. Putin is using the gold for credit creation to drive out the $'s. Putin has an advandage over the oligarchs by using the armed service or the tax man to take them on one by one. There is a few going down every month but if he can drive the dollar out with gold backed rubles the oligarchs lose their source of power. Gore with his Hammermill (SP) connection really goofed. Even Soros is helping Putin.
Gold confiscation will happen when the price moved up and the control of the commodity price is lost and the ESF has to make good its gold short position. When? Sooner or later unless we are all dead.
I'm afraid I am going to have to disagree with you about this credit creation gold etc. If it were true, we would not be able to buy gold at the current commodity price. We all know that we can.
Does anyone remember that in 1988, '89 or '90 - anyway, just before the collapse of the Soviet Union - the Soviet Union was said to have reserves of 2,200 tons of gold?
I remember the amount clearly.
Then, in the disorder when the USSR was collapsing, first the head of Treasury in charge of gold and then the second in command, who knew where the reserves were and the amounts, WERE THROWN OUT OF TENTH STORY WINDOWS!
Since then, it began to be said - mentioned in the press - that "Russia has no gold". Strange disappearance!
HOF Nomination Mr Gresham--Squeeze is On #45146Sir Randy-- We have three seconds to my nomination of Mr Gresham's post #45146 to the HOF. YGM, justamereBear, and $hifty have all agreed to the clarity and worthyness of this piece with their seconds. Thank you!
Mr Gresham-- The challenge is now to write a CLHE-HoF entry. I think you're just the guy to do it. Well done, Sir!
I am definitely in agreement with Christian. There are multiple prices for gold.
a) commodity price (ie spot) at 270; the gold you and I buy, derived from the suspicious paper markets.
b) trade sttlement price ($526??) which is the real (inflated) commodity price ie: the true POG not paper deflated. Note that documents accessible to this site mark $600 as the 'fair market value' for physical today.
c) the 'credit creation' POG is the fractionalization(sp?)
of $300 gold by a factor of 10, exactly what we see with fiat. Recall the discussions that banks require reserves of 10%. Please also note the coincidence with credit creating countries to gold backed reserves ie:US, UK, Europe. Note that non-gold backed fiat cannot create fiat credit ie:Russia.
Note I am the silvercollector and not the 'goldcollector'.
Belated Welcome to Mr. Paul Van Eeden to the USAGOLD Forum.
http://www.usagold.com/gildedopinion/vanEedenGold.htmlMr. Van Eeden,
I read all 9 chapters of your essay on, "Understanding Gold" located in,"The USAGOLD Gilded Opinion", at the top of the page.
A Big Thank you Sir, for your Excellent Perspective!
Unfortunately for me I'm a slow reader and even slower thinker, therefore it took all these weeks to respond and discuss a few of the points you raised.
I believe the main point you wanted to share was; Gold valued in many other currencies worldwide has remained fairly stable, and only lost value in U.S. dollars as the U.S. dollar gained in strength in relation to most other currencies.GOOD POINT, SIR!
Since first traveling overseas in the late 1950's I have been stymied on completely understanding the process by which currencies are valued in relation to each other.
I have posted this before and I will post it now again but it still comes up short on a "Complete" understanding, for me:
From my Broker:
FLOATING EXCHANGE RATE:
<>
Now, this explanation covered about 80% for me but there was still 20% mighty unclear. Today I did some more thinking on it and came up with 2 more plausible reasons for currency flucuations I had not thought about before.
Why has the U.S. dollar and the Yen lost value so fast in the last few weeks,"in relation to all other currencies???"
Reason # 1.:
""THREAT ONLY"" OF DEFAULT or OVER EXTENTION of CREDIT!
Many banks in Japan(from Bloomberg) are close to default, therefore credit ratings have been lowered, LOWERING the percieved value of the Yen! Same thing in the U.S. 'some banks in the U.S. may default on loans due to the energy problem in California, and the U.S. dollar is tanking, against all the currencies, that I've been following!
O.K. that seems to partially answer why the Yen and U.S. dollar are losing value currently. But it still doesn't answer the unknown 20% that's not mentioned in my brokers definition.
Today I did the year end statements for members of an investment fund I belong to, distributions(yearly income) are distributed by what percentage of the total amount a member owns....Then it dawned on me.... Could the "Worlds" total amount of "Money" be valued in a similar manner?? Please note this week,when the markets open, that the currencies seem to gain and lose value on a percentage basis in relation to each other. Ask yourself this, if the world is not on a Gold standard(Stable Base to Set a Standard Value) who or what computer could ever calculate every transaction in every country instantanously to give a fair value to currency? IMHO only using percentages of the whole amount could give a fairly close value to paper money on an international level.
Reason # 2, a "Percentage of the whole amount!"
It Makes a Lot of Sense to me!
Lets do 2 hypothetical scenarios:
example 1. A small country maintains a good balance of trade,a good supply of Foreign currency and Gold,the banks don't over extend themselves,and inflation is low and yet as we've seen, the past few years anyway, the local currency loses value in relation to the U.S. dollar.
WHY?
Because the U.S.dollar is simply "Gaining Strength" at a faster pace than the above small country!
example 2. Another small country imports very little and exports very little, very little internal borrowing or lending takes place,currency reserves and Gold stay the same, international debt is payed on time, and yet the currency is slowly being devalued over a period of time.(I've watched this happen!)
WHY???
Well, I submit, if that small countries amount of wealth(represented by currency)doesn't expand at the same "rate of expansion" as the rest of the country's currencies worldwide, it will lose value in relation!
As we at the forum have observed; the whole worlds unstable financial system is expanded by issuing more and more debt!!! If a country doesn't play this debt game their paper money's value is slowly eroded!!
One more point to Mr. Van Eeden:(Sorry for the long post.)
Mr. Van Eeden said in his essay:
<< U.S. based Gold mining companies will get the full benifit of an increase in the price of Gold, because Gold is priced in U.S. dollars.>>
I'm sorry Mr. Van Eeden, but I have to partially disagree on this one, here is why:
If the U.S. dollar continues to gain in strength in relation to other currencies to infinity, YES, U.S. based Gold mining companies will benifit as Gold rises in dollar price.
However,as you Sir, pointed out in your essay as other currencies gain in value and the U.S. dollar loses value(Which seems to be happening right now) wouldn't the value of the other currencies gain in value at a higher rate, therefore making holders of securities(ADR's & ADS's)more valuable than U.S. dollar denominated securities? A good current example are the South African Gold mining companies trading in the U.S. in "ADR & ADS" form. The U.S. dollar price of these stocks has, over the last few years, "Dropped" in price despite the relatively stable price of Gold in Rand in South Africa.
Why?
Because, the price of these stocks is adjusted each and every trading day by the Bank of New York's foriegn exchange currency desk, so prices in Rand's correspond to prices in U.S. dollars, otherwise some smart trader would buy in one location and sell in another to gain a profit from currency flucuations.By the way Sir,that may be changing right now, the South African Gold stocks seemed to gain or stay the same this week in U.S. dollars as the U.S. Gold stocks lost dollar value. Don't you think this could be because of the U.S. dollar losing value this week in relation to the Rand?
We Watch Together...Thanks for Reading....beesting.
For many years I thought the same thing. I keep asking why are we mortals allowed to buy ever cheaper commodity gold when credit creation gold is worth so much more. It is because we are not allowed to sell it as credit creation gold. We have a controlled above ground commodity gold price that will only last as long as only a few buy gold and some of those few will sell it back as commodity gold. If and when the commodity gold price moves up sharply there will be a bank holiday and gold confiscation. If people can figure out how to create their own credit with gold there will be a bank holiday and gold confiscation. People are so stupit that they believe our $'s are money. Our $'s are debts, promises to pay or an means of exchange of promises to pay. Each and every one of us is dependent on those promises to pay. Every paycheck is a promise to pay. Gold stands on its own, has no need for the promise to pay.------------ Bre-x- J.P.Morgan was Bre-x's banker AND advisor indirectly with the control of Bresea (SP) Resources Bre-x's parent company. This was a time when J.P.Morgan was building a short gold position to finance and invest in dot.com companies. J.P.Morgan set up this ponzi scheme so it could ride up the share price of Bre-X from its 30 cents a share financing to $280.00+ and then shorted it down to 10 cents when they cashed in. Bre-x and the dot.com companies have a lot in common. 1= credit creating gold financed the run up on stocks and the profits from that run up made possibe the huge profits made shorting it. In this way common peoples so called investments in shares is used as a means of transferring money from one pocket to another. I am no longer at liberty to say what J.P.Morgan did but i will say they had Felderhof in their back pocket. Also I can say this Bre-x had the one of the highest highs and lowest lows of any gold stocks. The Bre-X sell off collapsed other gold company share prices and even more money went from the many ordinary people to the few super rich. All I can say is that Bre-x like many dot.com companies are a set up. How do you convince ordinary conservative people to risk their life savings in risky investments like Bre-X or the Internet? One way is to drive stock prices so high, no one can stand to miss out on profits. After watching friends and neighbors rack up unheard of gains we all want a little for ourselves. Buy high and sell low and then wonder what went wrong. The same process is at work in reverse with the commodity gold price. Some day if most of us are still alive on this planet and gold is $10,000+ we got to buy for we can not afford to miss on those unheard of profits. It will tank right after that. Life is a crap shoot unless you know how to create your own credit. Make those pricipal and the interest payments to yourself. Even Buffet has figured it out and is now buying control of major corporations by buying discounted junk bonds at a steep discount with credit created silver. Most people have a credit card, some have a dozen or more, where do you think that money comes from. That money is created the moment you use that card to pay your purchase with. Why don't you create your own card or is that counterfeiting????? Why are we mortals not allowed to creat our own credit? Why are we not allowed to sell gold in the free underground credit creation market?
Belated Welcome to Mr. Paul Van Eeden to the USAGOLD Forum.
http://www.usagold.com/gildedopinion/vanEedenGold.htmlMr. Van Eeden,
I read all 9 chapters of your essay on, "Understanding Gold" located in,"The USAGOLD Gilded Opinion", at the top of the page.
A Big Thank you Sir, for your Excellent Perspective!
Unfortunately for me I'm a slow reader and even slower thinker, therefore it took all these weeks to respond and discuss a few of the points you raised.
I believe the main point you wanted to share was; Gold valued in many other currencies worldwide has remained fairly stable, and only lost value in U.S. dollars as the U.S. dollar gained in strength in relation to most other currencies.GOOD POINT, SIR!
Since first traveling overseas in the late 1950's I have been stymied on completely understanding the process by which currencies are valued in relation to each other.
I have posted this before and I will post it now again but it still comes up short on a "Complete" understanding, for me:
From my Broker:
FLOATING EXCHANGE RATE:
<>
Now, this explanation covered about 80% for me but there was still 20% mighty unclear. Today I did some more thinking on it and came up with 2 more plausible reasons for currency flucuations I had not thought about before.
Why has the U.S. dollar and the Yen lost value so fast in the last few weeks,"in relation to all other currencies???"
Reason # 1.:
""THREAT ONLY"" OF DEFAULT or OVER EXTENTION of CREDIT!
Many banks in Japan(from Bloomberg) are close to default, therefore credit ratings have been lowered, LOWERING the percieved value of the Yen! Same thing in the U.S. 'some banks in the U.S. may default on loans due to the energy problem in California, and the U.S. dollar is tanking, against all the currencies, that I've been following!
O.K. that seems to partially answer why the Yen and U.S. dollar are losing value currently. But it still doesn't answer the unknown 20% that's not mentioned in my brokers definition.
Today I did the year end statements for members of an investment fund I belong to, distributions(yearly income) are distributed by what percentage of the total amount a member owns....Then it dawned on me.... Could the "Worlds" total amount of "Money" be valued in a similar manner?? Please note this week,when the markets open, that the currencies seem to gain and lose value on a percentage basis in relation to each other. Ask yourself this, if the world is not on a Gold standard(Stable Base to Set a Standard Value) who or what computer could ever calculate every transaction in every country instantanously to give a fair value to currency? IMHO only using percentages of the whole amount could give a fairly close value to paper money on an international level.
Reason # 2, a "Percentage of the whole amount!"
It Makes a Lot of Sense to me!
Lets do 2 hypothetical scenarios:
example 1. A small country maintains a good balance of trade,a good supply of Foreign currency and Gold,the banks don't over extend themselves,and inflation is low and yet as we've seen, the past few years anyway, the local currency loses value in relation to the U.S. dollar.
WHY?
Because the U.S.dollar is simply "Gaining Strength" at a faster pace than the above small country!
example 2. Another small country imports very little and exports very little, very little internal borrowing or lending takes place,currency reserves and Gold stay the same, international debt is payed on time, and yet the currency is slowly being devalued over a period of time.(I've watched this happen!)
WHY???
Well, I submit, if that small countries amount of wealth(represented by currency)doesn't expand at the same "rate of expansion" as the rest of the country's currencies worldwide, it will lose value in relation!
As we at the forum have observed; the whole worlds unstable financial system is expanded by issuing more and more debt!!! If a country doesn't play this debt game their paper money's value is slowly eroded!!
One more point to Mr. Van Eeden:(Sorry for the long post.)
Mr. Van Eeden said in his essay:
<< U.S. based Gold mining companies will get the full benifit of an increase in the price of Gold, because Gold is priced in U.S. dollars.>>
I'm sorry Mr. Van Eeden, but I have to partially disagree on this one, here is why:
If the U.S. dollar continues to gain in strength in relation to other currencies to infinity, YES, U.S. based Gold mining companies will benifit as Gold rises in dollar price.
However,as you Sir, pointed out in your essay as other currencies gain in value and the U.S. dollar loses value(Which seems to be happening right now) wouldn't the value of the other currencies gain in value at a higher rate, therefore making holders of securities(ADR's & ADS's)more valuable than U.S. dollar denominated securities? A good current example are the South African Gold mining companies trading in the U.S. in "ADR & ADS" form. The U.S. dollar price of these stocks has, over the last few years, "Dropped" in price despite the relatively stable price of Gold in Rand in South Africa.
Why?
Because, the price of these stocks is adjusted each and every trading day by the Bank of New York's foriegn exchange currency desk, so prices in Rand's correspond to prices in U.S. dollars, otherwise some smart trader would buy in one location and sell in another to gain a profit from currency flucuations.By the way Sir,that may be changing right now, the South African Gold stocks seemed to gain or stay the same this week in U.S. dollars as the U.S. Gold stocks lost dollar value. Don't you think this could be because of the U.S. dollar losing value this week in relation to the Rand?
We Watch Together...Thanks for Reading....beesting.
The price of a gold price rise- are we prepared to pay it?
Watch for an increase in anti-China rhetoric over the next two years. It will start fairly soon, in subtle ways. So called 'dissident' claims will be published via the media, and claimed to be authentic by so called authoritive 'China watchers'.
Remember the first rule of propaganda - the bigger the lie the more easily it gets believed.
There will be civil unrest in China backed by you-know- whom. They have to get public opinion hyped up to 'we must liberate the Chinese from their evil government' emotions.
These anti-China sentiments will grow as we move into 2002, and the economic downturn starts to bite.
The US government ( the official one and the unofficial one) will need an enemy, and a focus away from domestic problems). Bush will also need good grounds for pushing through his 'missile defence' scheme. (well. it's not 'his' really but he will be the stooge mouthpiece).
There will also be a need to shift world attention from Israel's growing Middle East problems. (and they sure are growing)
Sorry to spread this doom and gloom picture, but you can see it coming, right now, if you have 20/20 'vision', and you will, in good time, see it coming even if you're blind.
The only thing I can't see now is where it will end - and maybe that is a good thing. I like to sleep nights. I have the feeling, though, that gold will be the least of our worries.
POG should be well into a steady positive move upwards by 2002, but what price will we have to pay for this to happen?
This is what we should concern ourselves with. And are we prepared to pay that price?
Remember the story told to fledgling Brokers about the guy who corners the market on a small-cap, 10Xing it and then when he tells his broker to sell, the response is "To whom?"
Same thing now for loaning new money into existence, To whom?
I'm actually afraid of the answer to that question.
Our boy Bill just keeps making friends and influencing folks
January 5, 2001 11:18 am EST
ROME (Reuters) - Pope John Paul was quoted as saying the only world leader he was never really able to have a proper conversation with was outgoing President Clinton.
In a wide-ranging interview published in Italian weekly magazine Oggi, the surgeon who operated on the Pope in 1994 said the 80-year-old Pontiff had revealed details of some of his encounters during relaxed conversations.
Quoting what the Pope said to him, Fineschi said:
"The only leader I did not manage to have a proper conversation with was Clinton. I was speaking and he was looking at one of the walls, admiring the frescos and the paintings.
"He was not listening to me," Fineschi quoted the Pope as saying.
Suggestion If I might?If there were HOF entries that others gushed over, but I considered to be total blather, I would allow {have allowed} the Forum process to function as set up and not go about disparaging the post, out of respect for fellow members. MK and friends are to be the final judges--If it's good enough for them..................
The issue of definition of money supply does not alter this article and the consequences on the payment system by a breakdown of "riskier" forms of money, however defined. All body parts are fully intact IMHO.
Best to all.
At the risk of defending Klinton, have you ever listened to the Pope talk? I'm not sure of the time frame that he was subjected to, but there is no way I could listen to the man for more than 15-20 minutes tops. Besides, he was busy gleaning useful political data, like observing how to pull off fingernails or burn opponents alive and get away with it.
Sir Pandagold...I appreciate your perspective on World Affairs.
With regard to Israel:
I never hear anyone mention (anywhere!) that Israel is in very deep trouble; that in fact, their back is up against the wall.
Prior to the Balfour Declaration in 1919, there were grave doubts in the minds of the leaders of Jewry, as to whether it was a wise idea to seek a "homeland in the Middle East", as the Balfour Declaration put it.
I seem to remember that it was the French Rothschild who questioned whether the establishment of such a homeland, would then give rise to the idea, around the world, of depriving Jews of their various "nationalities" in the countries where they lived - a logical enough conjecture, as those various countries might argue that Jews, having their own homeland, should be limited to that nationality, and not allowed another.
However, the Zionists won out, and the Israel project went forward.
Why do I say that Israel has its back to the wall?
It seems to me that their situation is similar to say, the hypothetical case of a cult which might declare that the Second Coming would without a doubt occur on such and such a date (and in fact, the Seventh Day Adventists started from such a proposition)
Once a material fact is declared to be a question of dogma, then there is no going back. The prophetic dogma becomes essential to the survival of the cult.
Now, the re-establishment of Israel is to today's Jews, very much a matter of dogma. It is the recovery of the promised land, as promised by Jehovah. "This is it", for the Jews. Some say that what holds modern Judaism together today, is the Israel project.
So, what this means is that for Judaism, there cannot be a failure of Israel as a country. It cannot be allowed, for it would set back Judaism say, 1,000 years.
Somewhere I read that a leading Jew stated that if Israel's existence is threatened, "We will go crazy!" Can you imagine a Tony Blair, a Chirac, a Clinton or Bush, a Putin saying that "We will go crazy!"??
Israel is extremely powerful, no question. But Israel is in very deep trouble. Surrounded by hundreds of millions of enemies, with whom no terms can be acceptable. This is a formula for disaster - and what will happen to the rest of us, when Israel "goes crazy"? Might they not nuke London, Paris and Moscow, and blame it on the Arabs?
Israel was better off when the Promised Land was remembered simply by the ritual saying, "Next year, in Jerusalem."
The Zionists got the Jews into a great deal of trouble, indeed.
@PandagoldAnswer : No. So what! We cannot do anything to change such occurrences. One thing : if it ever happens and we get through alive, then we will have some scores to settle.
Thanks for the insights. As the picture becomes clearer, I get the feeling that I need to run away in stark terror at the powers that be, like looking at a huge moon that hovers inches from the earth.
But the Islamic nations should be a balance of power to the British banksters, no?
Unfortunately, your nomination and seconds appeared while I was working on my response, but that is not the point.
First, I will take issue with your use of the word disparage. I do not see how the fact of nomination and seconds makes a point of debate �Disparaging'.
Secondly, my view is that a post appearing in the Hall Of Fame should be the most subject to accuracy in content because if it is not, the image of the Hall is itself disparaged. The agreement of four out of half a hundred debaters does not, by that vote, create a truth. I for one am dedicated to getting to the source definition of all phenomena delved into here.
I thought that truth was a basic purpose here. Now obviously there is much said that is opinion but some things are empirical. When readers are directed to the Hall Of Fame, they will, I would think, accept as fact that which is stated as such. Derivatives, Stock Certificates and other paper assets are NOT money, they must be SOLD for money to become legal tender that someone offering goods and services is obligated to accept.
I have not been alone in trying to get this FACT understood but have been working on this since way back, even before FOA's "Betting over the back fence post."
This blindness as to seeing derivatives as money seems to be ingrained out there in the bigger world of economic opining and it is my contention that much confusion and misconstruing derives some this false vision. If one can not discern what IS (Fiat) money from what instruments are not, than how can any extrapolations based on money supply and its flows come to any valid conclusion?
I strongly believe that The Hall of Fame should be the most subject to critique of any posts. I did NOT suggest this post be denied, there is merit in it; but I had hoped to stimulate some clarification and accuracy.
This problem has surfaced once before and the poster graciously did some rewriting which was to the benefit of all.
I can understand your concern as the nominator an perhaps as such you could address some of what I said here and earlier.
Yours for Truth, regardless of the consequences. Peter A.
PMs are Rising, Petroleum Rising, Euro Looking Stronger, and Equities Looking Grim
PM markets are getting a bit frisky tonight. The question is can they continue to rise and hold through the usual NY bashing? Gold is up +$1.05, Silver up a penny, Platinum is continuing to rise +$1.00, and Palladium is up $7.00. This could reflect the weakening US Dollar, a result of a number of recent events including the 75 basis point slashing of the overnight FED rate. The Euro stands at 95.93 and looks to blast through 96 and beyond. US Dollar index could fall below 108 today (maybe?). Petroleum is rising across the board with very good gains in NG at $9.75 Mbtu and could fly over $10.00 Mbtu very easily from here � especially with the weakened USD. Maybe this week the market in commodities and currencies will get very lively, and the equities markets will continuing the downward slide into oblivion. However, the index futures are slightly positive while overseas markets are generally negative.
Gas crisis just a rough transition; long-term outlook much clearer
12/18/2000
Editor's Note: Cambridge Energy Research Associates (CERA), based in Cambridge, MA, provides the following critique of skyrocketing natural gas prices. As this issue continues to unfold, Power Online hopes to bring, if not play-by-play coverage, this type of in-depth analysis designed to foster a deeper understanding of the headlines. ACM
The storm arrives
Colder-than-normal weather through November and for the first half of December throughout the Midwest and Northeast has driven gas prices well into record territory. The January Henry Hub price traded at a peak near US$9.50 per MMBtu Dec. 11. If December storage withdrawals are as high as CERA now expects, the gas market should start the new year with inventory levels at a record low level 1,850 Tcf�more than 650 Bcf lower than at the beginning of this year. This deficit will reverberate throughout the gas market next year and probably beyond.
Indeed, the enormous increase in storage injections needed next summer would keep the pressure on gas markets throughout 2001, although prices will fall off of the extreme winter peaks. For this reason, it is CERA's view that the gas market will remain on a high trajectory�with average annual Henry Hub prices expected to be between US$5.50 and US$6.50 per MMBtu for 2001�a record high.
So long as weather remains cold (or even normal) this winter, a new market dynamic comes into play in which gas prices interact more with distillate fuel oil prices rather than with those of residual fuel oil.
Also, gas is likely to have an increasingly direct influence on electric power prices in the growing number of regions in which gas-fired generation is now on the margin for much of the year. This winter, the gas market is likely to rediscover for the first time in decades which consumers value natural gas most highly, and which ultimately do not.
The gas market is also rediscovering the value of firm pipeline capacity, particularly into market areas. Both the West Coast and the Northeast have experienced even more extreme price spikes. Daily prices in New York have peaked near US$20 per MMBtu. In California, the shortage of gas is so acute that prices above US$50 per MMBtu have been reported. If sustained, these price levels will induce a political reaction expected to shake the industry.
Storage update�sustained record lows
The U.S. gas market remains highly seasonal, with gas withdrawn from storage accounting for just below 20% of winter supply. U.S. storage inventories started this heating season at a record low level, and the early cold has not allowed for any recovery.
Inventories as of the beginning of December, at an estimated 2,466 Bcf, were 525 Bcf below the year-earlier level, and this deficit is likely to increase substantially during December. Given cold temperatures so far in December, CERA estimates that storage withdrawals for the month will average about 20.0 Bcf per day.
This rate compares with less than 17.0 Bcf of withdrawal last December and only 14.0 Bcf per day in December 1998. This level of withdrawals would leave only 1,846 Bcf in storage Jan. 1, an inventory 663 Bcf below the year-earlier level, and a record end-of-year low.
Assuming normal weather, such an inventory would place storage on track to reach a March minimum of just under 500 Bcf, well below the 1996 record low. At a U.S. inventory level this low, many storage operators would be dipping into base gas�gas which normally remains in place to support storage reservoir pressure�to ensure that service even to firm gas customers continues.
Beyond this winter, the drive to replace depleted storage inventories will keep the pressure on the market throughout 2001 and probably into 2002. During the past two summers, high prices have been required to discourage demand and allow overall U.S. storage injections to reach barely 1.6 trillion cubic feet (Tcf).
This year, the injection requirement will be even greater. If normal weather holds for the remainder of this winter, 2.2 Tcf of injections�which would be nearly impossible to achieve�would be required during 2001 if inventories are to recover even to the record low level reached this year�2.7 Tcf at peak.
Reaching even the 2,400 Bcf level, according to CERA estimates, would prove challenging. Much of this will hinge on the extent of production growth in the U.S. and Canada over the next year.
While a boom in drilling activity has reversed the decline in production, at this point we appear headed for only a 1.2�1.5 Bcf per day increase in production during 2001. While this will help knock down the price spikes of this winter, all of this would have to be diverted to storage to bridge the inventory gap.
Yet we know that some will be needed to serve higher space heating load next year, as well as the growth in power generation demand for gas. As a result, only a portion can be used for storage injections�and a new record low in inventories entering next winter appears highly likely.
Demand�the difficult next round of switching With gas prices hitting new record highs, CERA expects some additional demand to be priced out of the market. Because gas has priced above residual fuel oil for most weeks since May, however, the easiest fuel switching in the power generation and industrial sectors has already occurred.
This represents about 1.0 Bcf per day of lost gas demand relative to this time last year. Even though gas prices are currently above the level of distillate, significant switching from gas to distillate requires changes in long-standing consumer habit and/or capital investments. This type of switching will occur only over time, and it is likely to be limited in volume. Also, significant switching to distillate would quickly raise the price of distillate itself.
As the market pressure continues, there are four major sources of additional demand response in industrial markets:
Additional switching to resid in industrial boilers�CERA estimates that the industrial boiler market has already started to lose small additional amounts of gas demand (less than 0.5 Bcf per day) through switching to resid, given the consistency of gas price premiums greater than US$0.50 per MMBtu. Investment in restoring switching capability�As premiums move far beyond this level, industrial end users can be expected to take a closer look at reinvigorating their switching capability beyond their initial short-term levels. However, such a change would require investment by industrial end users and the availability of resid fuel oil delivered to their site. CERA estimates that with focused investment over the course of a number of months to perhaps a year, switching to resid could eventually reach as high as 1.3 Bcf per day.
Switching to distillate�U.S. Department of Energy (DOE) data suggest that industrial end users have a theoretical capability of switching nearly 1.3 Bcf per day to distillate in the short term. This switch would represent additional distillate demand of over 200,000 barrels per day in a U.S. market of 3.8 million barrels. Some of it has, no doubt, already occurred. Shutting down industrial plants�Also offering some flexibility is the shutdown of manufacturing plants that use gas as a feedstock. Given the tight margins available, the major feedstock consumers (manufacturers of ammonia and of methanol), continue to show suppressed gas demand. CERA estimates additional losses of at least 200 million cubic feet (MMcf) per day of potential demand in addition to the facilities that have already closed. Extraordinarily high gas prices will also hasten the shuttering of North American methanol capacity, putting at risk another 100 to 200 MMcf per day of gas demand for that sector.
Conclusions
Although this cycle of high natural gas prices is likely to be extended through next year and beyond, investments are already underway that will bring longer-term supply sources to bear in the U.S. market.
Extreme pricing now is the result of demand pressure hitting just as supply has reached a multi-year low in the U.S. The new sources of supply will require both investment and time, but this period represents a difficult transition in the U.S. gas market, rather than an indication of any long-term shortage of natural gas.
The era in which U.S. lower-48 gas supplies could respond quickly and in large volume may be ending, while replacement supplies are still on the horizon beyond 2001.
Nevertheless, these supplies�from Canada, the deep water, the arctic, and LNG�are on their way. These will allow natural gas to fulfill its potential as a moderately priced, vital contributor to meeting the nation's growing energy needs.
CERA provides independent analysis and insight into the energy future by focusing on energy markets, geopolitics, industry trends and strategy. CERA's expertise covers major energy sectors�oil, refined products, natural gas, and electric power�on a regional and global basis. CERA, based in Cambridge, MA, also maintains offices in Bangkok, Beijing, Buenos Aires, Calgary, Houston, Mexico City, Moscow, Oakland, Oslo, Paris, Seoul and Washington, D.C.
For more information, visit www.cera.com.
Edited by April C. Murelio, Managing Editor, Power Online
Black Blade: Excellent thesis on the Natural Gas energy crisis. The Grasshoppers should take note. Hydro-Carbon Man's addiction to petroleum is about to be tested. Prices must rise. Then again, don't worry Grasshopper, it isn't calculated in the "Core-Rates" of inflation so everything is just Peachy! "And the Grasshoppers danced, played, and sang all summer�"
Agreed on all points re: POG as an inflation barometer. One point I'd like to make though is that all (?) "Islamic Countries" are trading Fiat Currencies at present and there seems to be no end to that.
......more's the pity :-(
Perhaps the Author will oblige and forward "the plan".
NEW YORK (Reuters) - The Federal Reserve briefly ignited the stock market with interest rate cuts last week, but concerns the United States still may face a harsh economic winter will send a chill through Wall Street in days ahead. Stocks are likely to fall on worries the central bank already may be too late to keep dwindling growth from crunching corporate profits. Traders are wringing their hands as they await this year's first major earnings reports, and will scrutinize economic data for signs of the economic slowdown. To make matters worse, a financial scare is rippling through Wall Street. Investors fear big U.S. banks could face losses on financings to near-bankrupt California utilities.
``The big problem right now is that, while the Fed is in an easing mode and has demonstrated its willingness to reduce rates, the fundamental story remains pessimistic,'' said Paul Cherney, market analyst at S&P Marketscope. In a surprise move that caught many traders mid-lunch last Wednesday, the Fed cut interest rates by a half percentage point, bringing its key fed funds overnight bank lending rate to 6.0 percent. The ease came four weeks before the Fed's regularly scheduled policy-setting meeting at month's end. Wednesday's Fed action sparked a wild buying spree in U.S. stocks that helped the Nasdaq Composite Index (.IXIC) rack up the biggest one-day gain ever in its 30-year history -- up more than 14 percent. By Thursday, however, the rally had fizzled as concerns grew that the Fed may have acted too late to avert a deep slowdown at least for the first half of the year. The Nasdaq ended a shortened week down 2.5 percent, while the Dow Jones industrial average (.DJI) finished off 1.2 percent. ``It's really hard to turn the economy on one Fed rate cut,'' Peter Gottlieb, portfolio manager at First Albany Asset Management, said. ``It takes some time before the rate cuts take effect, and so I'm not sure that in the near-term you're going to see enough of an impact on the economy to really make a difference.'' On Friday, new U.S. jobs data showing the economy continues to slow dragged the stock market lower, while financial shares were crushed by rumors -- later denied by the company -- that Bank of America (NYSE: BAC) was facing significant losses from its involvement with California utilities.
Stocks of banks and brokerages are normally viewed as the best performers in an environment of easier monetary policy as the lower cost of credit encourages borrowing. ``If they seem to falter, I think the implication is that there may be some trouble ahead for the rest of the market,'' Gottlieb said.
EARNINGS SEASON TAKES OFF
The earnings picture, however, will be foremost on Wall Street investors' minds as fourth-quarter earnings start to trickle in and Wall Street listens to what companies see for the quarters to come. Alcoa Inc. (NYSE: AA), aluminum giant and Dow 30 stalwart, kicks off the week on Monday with its quarterly earnings statement. On Wednesday, after the close of trading, Motorola Inc. (NYSE: MOT) reports its fourth-quarter earnings. In December, the world's No. 2 mobile phone maker sent a chill through the high-tech industry when it announced its quarterly profits would fall some 40 percent below earlier estimates. Internet media giant Yahoo! Corp. (Nasdaq: YHOO), part of a sector plagued in recent months by worries that the evaporation of the dot-com boom will mean dwindling advertising revenues, also reports its fourth-quarter earnings on Wednesday. After Thursday's close, software company Ariba Inc. (Nasdaq: ARBA ) will issue its quarterly earnings report. Its shares came under siege last week amid fears about its exposure to flailing Internet firms.
KEY DATA FOR SIGNS OF SLOWDOWN
Traders will be watching out for key U.S. retail sales and inflation data, both due on Friday, for more signs that the economy is becoming ever more sluggish. Retail sales -- a gauge of the consumer spending that has helped power the longest U.S. economic expansion ever -- are expected to have fallen 0.4 percent in December following a similar drop in November, according to U.S. economists in a Reuters survey. They predicted slackening in sales of automobiles would account for a significant chunk of the drop, however, which means retail sales excluding cars and trucks gained 0.1 percent versus the prior month's 0.2 percent gain. In a separate report, the U.S. government will release data on producer-level inflation. Economists on average saw the Producer Price Index (PPI) ticking up 0.1 percent in December both overall and excluding volatile food and energy prices. In November, PPI rose 0.1 percent and was flat minus food and energy. Those results and the degree of economic sluggishness they show could impact the Fed's decision on interest rates when it next meets on Jan. 30-31, analysts said. The central bank is widely expected to lower rates again by a quarter percentage point at the meeting. ``The economy really is a lot weaker than people thought,'' Guy Truicko, portfolio manager at Union Management, said. ``The Fed's going to have to ease to get this thing rolling, and the market's telling us it's still behind the curve.'' But the Fed's rapid shift to a much easier monetary policy means that, although stocks may be headed for a rough patch as the economy slows to a more moderate pace, there is light at the end of the tunnel for Wall Street, analysts said. ``The market is going to start discounting better times ahead,'' Truicko said. ``The Fed's not going to let this economy die.''
Black Blade: The picture doesn't look so rosy does it? The equities markets should continue to get hammered as earnings warnings will be coming out all week long. Profit margins are getting squeezed, and the higher cost � much associated with higher energy must be passed on to the consumer. With a tanking stock market and falling US Dollar, there aren't too many alternatives left. The Europeans will call home their cash and go into Euros and Gold.
http://biz.yahoo.com/bw/010108/tx_baker_h.htmlMore rigs are drilling than ever for NG and oil, but it's a case of too little - too late. Energy Crisis = Recession = Market Crash = Rush to Safe Havens (such as gold).
http://dailynews.yahoo.com/h/cdh/20010107/lo/skyrocketing_gas_bills_prompt_protest_1.htmlThe Grasshoppers are beginning to freeze! Matt Simmons of Simmons and Company International had predicted that there could be many deaths due to the energy crisis. Will the Grasshoppers dodge the bullet? Steal from the Ants? NG levels are at record low levels, and will be drawn down over the summer as increased demand for power continues.
Dow Jones - London AM Palladium Fixing $1010.00 Mon Vs $977.00 Fri PM
The Russians haven't delivered palladium and are not likely to deliver any meaningful quantity. Platinum supplies also look a bit tight as well. Could be an interesting day for PGMs. Meanwhile the Euro is pulling back, as are most currencies. Petroleum prices are getting stronger. Stock index Futures are moving higher. Gold and silver are looking comatose right now.
Because, I believe, that gold is a 'political' metal, primarily because it is the only 'real' money that has stood the test of time, it is understandable that postings in this forum often appear to stray into other sensitive and controversial areas.
This, if we are not careful can lead to misjudgements and into discourse that could take us way off track.
I am sure we all have profound thoughts in these 'no go' areas, that if we were together, and not 'on the air� we could (and would love to) expound. We would also love to know how many others share the same thoughts, and 'are we right in our thinking?'
However, we must be ever mindful that the opportunity to post here is a privilege that is provided for a specific purpose, however much we are tempted to stray.
In consequence, I wish to state, I do not wish to be misunderstood in that I have any particular political, or religious stance, ever, in my postings. That is far from the case. As far as I have read, most of the major religions carry much the same message.
Even politics, today, only appear to have slightly varied approaches to arriving at the same thing - the control of the masses by the few.
As one of the masses, I hope I speak for most of my fellow sufferers when I say that I don't mind being 'governed' by the few, or even a single entity, if he/she, or they, administer, to all, with a reasonable degree of fairness and transparency.
I have travelled, and lived in many parts of the world among diverse cultures, religions, and political persuasions. What I have found is that all people have at their heart the same basic desires. We have all far more in common than we have differences.
There are, of course, elements within a particular society whose motives and actions of self-interest bring discredit on others with whom they are associated by ethnicity, religion, and politics or, in some cases, all of these.
We should be careful, therefore, never to condemn, or appear to condemn, the whole batch for one or two bad loaves. Nor should we allow ourselves to be influenced, either by government, media (especially government and media), or individuals, that any particular nation or leader (or whatever), is bad. That is, not without having presented, fairly, both sides of the argument. In other words, give the other guy 'his day in court' before we are urged to take up arms - literally or otherwise.
DJ Palladium Finally Breaks Through $1,000/Oz; Seen Higher
LONDON (Dow Jones)--With traders still plagued by fears over when Russia will release supplies to the market, palladium finally succumbed to the inevitable Monday, and broke through the $1,000 a troy ounce barrier. Monday morning, palladium fixed at $1,010/oz, and traded spot at this level minutes later, although the extremely thin volumes are contributing to large price swings and market nervousness, dealers said. "The buying's very, very small...but there are no sellers out there," the senior dealer at a bank in London said. The whole thing's crazy." This time last year, palladium was trading at $440/oz, but steady demand from the auto industry and erratic supply from Russia, the world's largest producer and exporter, has lifted the price to record highs. Meanwhile, gold was garnering support from the steady performance of sterling and the euro against the dollar, and the potential for further dollar weakness following the cut in U.S. interest rates last week, dealers said. While market participants had been expecting palladium to break $1,000/oz for some time now, the timing of when material might start flowing out of Russia is more of a conundrum. Dealers say they noticed platinum coming out of Russia last week - which capped that metal's rise to a 13-year high - but there is no evidence of any palladium being sold. With the price in uncharted waters, nobody can afford to take short positions in case the price goes even higher. Further moves higher are therefore likely, with $1,030 and $1,050 the next targets, according to a second London-based dealer. Gold is also looking good, with strong buying on the lows of $267.50/oz suggesting the range of $268-$272/oz will hold firm this week, dealers said. Sterling is holding above $1.50, while the euro is managing - only just - to hold above $0.95, which is giving encouragement to gold bulls. A weaker dollar encourages consumer buying, while at the same time helping to cap producer selling. The more bullish participants said that in the longer term, gold could benefit from the deteriorating global economic picture, which the surprise cut in U.S. interest rates would appear to confirm. In times of economic uncertainty, gold is traditionally seen as a store of value and a hedge against inflation.
A merger of 2 entities the size of JPM and Chase will normally take at least a year to conclude, maybe more. There would normally be a leak when the negotiating is initiated. However, I was astounded at the speed at which the merger occured. Can we attribute this to some fiscal indigestion at JPM?
Yes, do be very careful. Judging from your handle, you already possess some form of protection.
Our present monetary system of a privately owned FED writting checks on an account with nothing in it and charging interet on that so called money that is not brought into circulation is a contract to commit tort and is illegal and unconstitutional. The interest (usury) is a factor which makes this contract illegal. If the central banks have the right to buy commodity gold like we all do then we should have the right to create $3000 worth of credit with it just like they do. -- I know how central banks do it but I do not have the right to do it which to me is a bunch of BS. People like Buffet know how to do it and I wish some of you who have a better mind then I do would help me. ---- I am sick of "playing the market" for I find it not effective way to raise my living standard. I am a farmer by trade and the froth in the financial and real estate markets has come at the expense of our natural resource recovery industries (mining and farming) who are now forced into a state of welfare support. There is now to many stupid people that have a great deal of stupid money (blind capital) craving to make the next killing in the financial markets. Presently the real economy in foreign exchange transactions is down to 2% and the other 98% is now financial currency speculation. It now takes $3.00 worth of credit creation for every $1.00 worth of GNP of which .98 is uneeded BS GNP and only .02 is real GNP. I am a firm believer of the small self sufficient farmer (natural resource recovery industry) making a profit, not the banker, regulator and tax men making a profit on the natural resource recovery industry (farmer). It is the ever bigger profits of the banker who force the natural resource recovery industry to forward sell at the lowest possible price to collateralize (monetize) operational expenses to bring the crop to market to exist on a state of welfare support. There is a need to get around the banker and self finance. Make the principal and interest payments to one's own account instead of enriching the already super rich. A few years ago when Greenspan was in Germany he used the words Kreieren Undergang (creative destruction) was the central banks goal by suppressing the real economy. Seems to me he is achieving that. Everybody is playing the market for a quick kill. Gold market is a natural resource recovery industry getting killed. Here gold companies have their own credit creation commodity but sell it as a commodity for the lowest possible price in order to get fiat financing to continue their money losing operation. How can people be so stupid selling real money (gold) for fiat? There has to be a way out of this stupidity.
Home Depot has been building their huge stores here in Palm Beach County, Florida, like there's no tomorrow. There are at least ten of these huge stores in the county, several built within the past 2 or 3 years. Three of them have been built within the past year and a half within a twenty minute drive from West Palm Beach, adding to the one already northwest of the city.
I have been in several of them, especially a new one that's located about a mile from downtown West Palm Beach that opened just before Chrstmas. Great to shop there at any time because there's hardly anyone ever there. Kind of scary in a funny sort of way to see so few cars in the huge parking lot. Two to three years ago the Home Depot stores already here were sometimes very crowded and it was difficult to find a parking space. I don't see that now even on weekends.
Recently, Home Depot took out large ads in the local paper offering a 10% discount on purchases. I'm told this is the first time they have done this, at least here in this supposedly booming market. And to make matters worse, competitor Lowes recently opened an even bigger store literally across the highway from from one of the new Home Depots.
Even if the housing and construction boom were to continue in the county indefinitely, it is hard for me to imagine the company making huge profits. Not hard to imagine though what could happen to them if (when) the real estate market or the economy tanks.
I was talking to a Spanish ex-pat last night and he remarked that real estate prices there were escalating as people and other entities were busy converting their "dirty" cash prior to e-day. Seems like there would be increased demand on PMs as well. Any corroboration from our European bureau?
Hello Panda,
Although I don't agree with every view you have, I feel it is important to suport your last post.
There are many great minds here in this forum. I enjoy getting so many views. Here's mine.
I feel it's wrong to use derogatory remarks to refer to people from one region or another. It shows a great deal of disrespect for the vast majority that get up every day, raise kids, fix cars, paint houses, hall produce.......
If one chooses to bash an individual, go for it: We all love to rip Mr. Greenspan. One might even take issue with an organization: NAACP, ACLU, FBI, CIA, Girl Scouts.....
Out with the temporary, Fed adds permanent reserves to nation's banking system today
The Fed opted today for an outright purchase of Treasury coupons (dated August 2004 to August 2007) for Tuesday delivery totalling $0.71 billion.
I guarantee you this: you will not see them fabricating new gold reserves in such a manner...they cannot print gold, you know. At the nearest you would get gold on credit...distinctly NOT suitable because the unique purpose for gold is serve as a the primary financial asset which is utterly free from risk of credit default.
Bottom line: You either have gold the METAL, or else you only have a variation on a dollar-based paper theme that diminish in recognized value before your wondering but helpless eyes. The fate of the dollar is no longer in the Fed's (nor the U.S. Govt's) hands.
I do not assume to have all the answers but I will try to answer your question as best as I can. You are right that your broker's answer is incomplete. You have to add market participants� perception of value. It is changes in perception that drives markets in the short term and cause variations between price and value. Of course, it is important to distinguish between price and value, since the two are definitely not the same.
The recent changes that we have seen in currency exchange rates have a lot to do with changing perceptions. The market tends to be forward looking and attempts to discount future events in current prices.
Currencies present a unique problem for the market though. In general an item's price will fluctuate above and below its value over the course of time due to changes in perception. In the case of today's fiat currencies, they have no value since they are created out of thin air and the so-called reserves are a negligible amount relative to the issued currencies. This is further complicated by the cross holding of currencies in foreign reserves and the pervasiveness of the US dollar in the foreign reserves of the world.
A currency's price is therefore determined solely by the confidence that people have in the currency. The things your broker mentioned, such as foreign reserves, balance of payments, GDP, inflation, interest rates, etc, influence this confidence and if this confidence is shattered, the powers that be will try everything possible to restore confidence in their currency and prevent it from devaluing to nothing. Our history is rife with examples of currencies going to zero.
It is important to remember that price is not the same as value but that price ultimately converges with value over time. Even though it could take a very long time for that convergence to occur.
As in any market, currency exchange rates are determined by supply and demand. It isn't necessary for there to be a standard against which all currencies have to be measure in order to calculate exchange rates. It is the relative demand of one currency versus another that sets the price. In fact, the dollar's current value has a lot to do with foreign investors buying US stocks and bonds, which has very little to do with any "fundamental value" of the dollar.
Your idea about currencies being valued as a percentage of the total currency market has one flaw that can be seen if you take the idea a step further. Assume that America issues dollars at an incredible rate, faster than anyone else on a percentage basis. According to you, the dollar's value will then increase relative to other currencies because the amount of dollars in the world will increase in relation to other currencies. But price is a function of supply and demand and the supply of dollars in this example will increase substantially, thus lowering its price. Recall that inflation was traditionally defined as an increase in money supply and has the effect of decreasing the value (I should really say price) of the currency being inflated. It is only recently that economists started defining inflation as an increase in prices of goods relative to currencies, but the result is still a devaluation of the currency. The more currency you issue, the less it becomes worth.
If you want to look at the world's currencies as a pool and think about any one currency in relation to the rest in the pool, I can suggest a model that won't necessarily work 100%, but it might make some sense. Start by adding together the GDP for all the countries in the world and then compare any one county's percentage GDP to its percentage of currency relative to all the currencies outstanding. If a country's percentage of GDP is less than its percentage of worldwide currencies, its currency should be overpriced and vice versa. Then if a country increases its currency in relation to other currencies faster than what its GDP increases in relation to other country's GDP, its currency will devalue and you get the inverse relationship between supply and price, which is what one would expect. Of course this model has many flaws, the most glaring of which is an adjustment for balance of payments.
With regard to the countries that you have mentioned, I cannot comment because I don't know which ones you are talking about, and even if I did I most likely would still not know why their currencies have done poorly in relation to other currencies as you mentioned. But markets are not efficient, and many aberrations between price and value exist, and can persist for extended periods of time. So there is no quick and easy answer to any of these questions. That is what makes speculation on the markets so much fun.
Your last point about North American versus other gold stocks also deserves comment. The reason that I suggested North American gold mining companies should outperform their peers is that you have to look at the currency in which production costs are paid versus revenue generated. In the case of South Africa as an example, the mining companies have survived because their costs are denominated in rands, which has fallen against the dollar as the gold price has declined. None of this is coincidental, it is all part of the same phenomenon. But the declining rand has resulted in an increase in the rand denominated gold price and thus maintained the operating margins of the South African gold mining companies as the dollar denominated gold price has fallen.
If the dollar declines I would expect the dollar gold price to increase and for North American gold mining companies that should be a windfall since their costs are in dollars and their revenue is gold, which is gaining against the dollar and hence increasing their margins. It is the leverage that gold producers have to changes in the gold price that make all of this work, i.e. the difference between revenue and production cost.
Again looking at South African gold stocks, if the rand appreciates against the dollar, the rand gold price may or may not fall depending on the relative changes in the dollar denominated gold price versus the rand-dollar exchange rate. But the South African gold mining companies will continue to have inflation of their production costs in relation to South African inflation rates and hence it is uncertain how the story will unfold for them. Remember that in the 1970's when the South African gold stocks did so well in relation to other gold mining stocks, the rand was fixed against the dollar, which it isn't now. That was a whole different ball game.
I too apologize for this lengthy reply. I wish I could be more concise, then I would probably be more active in these groups. As it is these responses take far too long and so I have to restrain my posting activities.
A good post at 45280. I think it was Aristotle (the old one)that said in order to find the truth you must hear all sides in their most persuasive form.
Am enjoying your posts very much as you obviously have knowledge that is far from common. I will make a brief point about GATA and their reasons for taking on the BIS vs the LBMA. It is purely incidental to the fact that the BIS allowed the opening with their shareholder freeze-out and Reg Howe happened to be a shareholder. I am not privy to all of the lawsuit strategies, as almost no one isfor obvious reasons. Shooting from my hip though, I would surmise they would love access to each tentacle of the creature. A successful discovery gives a transparent gold market. Where can they be contained? That is the huge question.BIS, LBMA, FED, ESF, Ft. Knox{?}, multiple esteemed banking establishments, International Puppeteers Association? I do not remember GATA even mentioning Ft Knox. This will all make WJC look like he really did supply all the facts as soon as possible!
Are you completely certain that GATA has full knowledge of your various prices for gold trading/settlement? I'm not sure they do. Sometimes I think their tiger is much bigger than the initial tail told! It may be much bigger still than what they would ever dream. I can tell you this-- they're not letting go!
While we're at it, let me throw a couple of center field questions your way. We are a captive and appreciative audience!
1- Can you shed a little light on Vatican gold, and current uses?
2- Can you delve into the "Black Gold" issues more? Or is this thoroughly covered in your discussed trade settlement categories? Frankly, is the above ground gold supply a multiple of what we think it is? Have you read "The Secret Gold Treaty"?
3- Ft. Knox gold issues?
If you need to answer "I cannot go there", will perfectly understand.
4- When trade settlement gold changes hands, what is the US origin of this gold? Treasury {FK}, ESF?
They say "when the pupil is ready the teacher will appear". We're ready, hoping the teacher has appeared. By the way, you are not the only poster to talk of "parallel" markets on this Forum, so you are in excellent company IMHO.
Best to you Brother,
auspec
That was one fine concise unveiling before our eyes.
Question? If you have time.
I am convinced that the current recession that we have entered has been orchestrated by the yield inversion which has been methodically implemented by Greenspan and Co.
I believe that a recession officially defined as two quarters of negative growth has started. The only remaining piece of the puzzle is the transpiration of the facts. We never are in a recession until the government admits that we are in one after the fact.
Could you please comment upon this inverted curve and whether you think it is a dependale indicator of what is happening to us right now. I have operated for the last 3 or 4 months under the assumption that we will be in recession for much of 2001.
Would you be kind enough to provide clarification as to what you consider the "money supply" to be as per your "AG and Payments System: Squeeze is On"? While I, personally, do not see a rigid definition of the money supply as being a central issue to the possible breakdown in the payment system {the same risk exists no matter how one wants to categorize}, there are concerns expressed that this definition is important when considering HOF entry. I can read your entire post without derivatives coming to the forefront, but again "money supply" is not my forte {will let you know if I find my forte}.
Please refer to Peter Asher's post #45234 for specifics if you will. You may alter, delete, clarify, or stand pat as far as I know. Technicalities are the business of the Forum, not this bloke. I enjoy your post each time I read it, in spite of the fact that Chemistry {minor} was also not my forte.
My apologies to the gentlemen of this Forum for seeing a disparagement "ghost". A finger was poked into an issue a bit hotter than realized. These shall both heal/cool!
Goodnight to all--hope I didn't run Christian off with that can of worms list of questions asked of him.
GATA ROCKS!! {The precious kind}
Mr. van Eeden a sincere thank you for your insight & time # 45290
Thanks for pointing out the "flaw" in my post on currency's, your world GDP model does seem to offer a better perspective. As far as speculation "can be fun" it can also be agonizing, ask any long term Goldheart that visits these pages.
Many here cannot understand why the masses are not investing a portion of their investments in Gold right now, historically the safest long term storage of wealth available to all and in limited supply.Most must not realise that Gold coins have a chance to appreciate in value 2 ways, as collectors items and as the "Spot" price of Gold appreciates. By the way I have some recently minted Gold coins I bought in 1996 when "Spot" was around $380 that according to my coin book are still valued approximately at what I paid for them.
Van Eeden's explanation of the possible relationship of currency expansion relative to GDP etc. is quite off the mark. I tried analyzing the currency exchange rates using this point of view, but found little rhyme and no reason as to the moves. Though intuitively very attractive, the idea simply does not wash the moment the fact of trade flows being much smaller than GDP is considered.
The international markets move enormous amounts of currency daily as they move from one institution or financial instrument to another, seeking returns one iota greater than where they were just a few minutes before, and responding to programmed diversification criteria spit out by the computer in response to business contracts being signed or one investment rising to disproportion while another falls. These volumes have risen in response to the fall of transaction costs.
The bulk of these flows have little to do with supply and demand for currency, they merely respond to what has happened. The main response of the actual exchange rates is to the amounts entering and exiting the international trading arena. There are sources for supply, and sources for demand. Demand is for debt repayment and for "cash" balances and their equivalents for the purpose of either buying internationally traded commodities, or in order to "sanitize" local debt creation with reserves. Supply is net from trade surplusses and deficits and from income flows, but most predominantly as a result of debt creation.
The BIS observed that debt creation will tend to occur in the currency that has appreciated most, has been strongest, over the immediate past (months to a year or so). This flows from the lender's preference to be paid in the strongest currency. The only exception being the 1999-2000 Euro debt expansion.
For a long while, I thought the capital flows would drive exchange rates, and they do, but not directly as one might expect. As the Asian crisis evolved, one could observe that Asian currencies broke down with minor outflows of capital. The main difference between the "before" "during" and "after" were the strong inflows before simply stopping - not reversing. The main culprit in reserves falling prior to a currency debacle is seldom a capital flight, but a trade related problem of trade imbalance depleting reserves.
The main point to consider here is that only the dollar and now the Euro have a substantial debt demand base globally, the Yen Sterling and Swiss Franc having smaller ones. This means that the local currency has no external demand of its own. Thus its sale on the international markets results in immediate depreciation as there is no "natural" bid.
The net capital flows are significant in that they replace local savings that are instead spent on goods and services as the capital goes to work by being spent on labor. Labor income is increased due to capital investment and demand for products grows, which is met, in turn, with imports. Imports decrease reserves if the currency is "defended". If not, local prices rise to accomodate the added income from foreign capital being invested. Because the price flexibility of products is extremely non-linear, the new demand from increased capital flow pressures prices upwards, causing imports to flow in (as local prices rise above international prices). This analysis does not work in the US or in substantial creditor nations such as Hong Kong, Japan, China, Taiwan, Germany (and thereby the EU), etc..
One of the so called mysteries of internaitonal trade and financial statistics is that total imports are forever greater than total exports no matter how many adjustments are applied to the numbers. They just plain don't balance - mainly because of debt outstanding sucking the trade balances in the form of interest payments.
Bottom line, capital flows are not important as drivers, they are important as results that do affect the main drivers circularly, in a virtuous (or vicious) circle.
For the US and presumably for the EU in the future (which is not going to be the great player as reserve currency issuer until its ex EU trade levels double) reserve currency status and debt outstanding drives trade which then drives prices in the various markets, and then drives the capital markets to fill in missing supply.
The debtors who have obliged themselves to supply so many reserve currency units over a set period of time under pain of bankruptcy and reposession, are the highest bidders for the reserve currency. Their need to keep their mortgaged property brings the value of the one additional currency unit needed to make the coming payment on time (or at all) is the value of the physical, organizational and intellectual capital accumulated in the corporation - all that would be lost if debt payments are not met. What these debtors have on offer will be used to purchase the dollars. Be it bannanas, Hyundai Elantras or anything else, it all bids to buy that marginal dollar that will complete the debt payment.
The main result of this is that the items are dumped on the international market during crisis, so that prices are driven downwards. This makes imported inputs into the reserve issuer's (RI) markets fall in price, while increasing the import purchasing power of the local population, who then proceed to borrow or dis-save in order to buy these bargains - in short, the exporter exports because his local market is priced out, and the RI's people and corporations just borrow the currency into existence and pay for the products, they are priced into the market by the import price drop. Local businesses at the RI are built to import the cheap products and package, promote or assemble them into the convenient form or format for the RI consumer.
The credit expansion that forms as both consumers and business borrow currency in order to import the cheap goods makes profits soar and brings in capital from abroad. The profits, being the difference between local (inflated) price and local processing costs plus (deflated) import costs, drive investment in import processing, distribution, and marketing/retailing. The profit opportunities make for the investment inflows. As clear evidence of this, it should be noted that savings are high where local purchasing power is taxed by government or existing indebtedness and either government or foreigners compete with the locals for their production. Locals are priced out of the markets, and save the income they could not spend at what they thought to be reasonable prices.
The importers, to date that means the US, the only RI of significance, are priced out of the capital markets due to foreign competition for returns against their savings, and are priced in on the internationally traded goods markets. Their savings fall in accordance to the total competition they face for the imports and products/services in general by their government. Current data show Americans are finding little competition for imports from their government (whos expenditures are falling or stable as a share of national income), substantial but not bad competition for local items (hence service price rises), and heavy competition from foreign investors that have so priced them out of the markets, that dividends on the SP 500 are 1.3%, and the corporations found it appropriate to pay out only 26% of their free cash flow instead of 45% in prior periods. Obviously someone outbid Americans for investment returns, since they were selling $500 billion of these investments (actually only $250 billion including mutual funds, but back to the same number if direct investment is put back in the accounts), and foreigners, insurers, and government pensions bought them.
In short, since equity source income from capital gains are not part of the reported US incomes, the actual US savings rate is actually overstated.
There seems to be a common denominator here in Currency and Stocks.People buy or sell them because of what they think other people are buying and selling rather than for what productivity or earnings are backing either.
This all has become trading on the perception of someone's perception of someone else's perception of the present and future state of the actual nuts and bolts.
The playing field of floating currencies simply functions on "Build it and they will come." A Field of traders dreams, and productive people's endless nightmares!
For many economists, the matter of the current accounts and capital accounts is one of balance "by definition". The part that does not respond to the definition is swept under a separate account called "discrepancy" - i.e. the difference between theory and practice. This comes to about 10% of exports.
The information in the accounts data sheds no light on which causes which; trade deficits causing capital imports or capital imports causing trade deficits. A chicken and egg kind of situation.
As I should have made slightly clearer in the previous posting, the chicken of one country lays the other's eggs. The chicken being the reserve currency issuing country, laying little anti-eggs wherever one borrows it, and laying decrepid eggs in the creditor's central nests that hatch into scrawny chicks. The eggs borrowed into debtor's end up hatching into little inverted anti-chickens consuming the local chickens and the henhouse.
The capital surplus of a debtor or breakeven nation causes its trade deficit. The trade deficit of the reserve issuer will bring forth capital flows.
The negative income flows of the debtor nation drives its trade surplus and distorts its pricing.
The capital flows follow in accordance with the profit opportunities for internal and exporting/importing operations.
http://203.79.82.35/nzbanking/mmm2.htmlBesides showing how they turn a $10,000. deposit into $100,000. on the books , they mention ESF, gold. Lots of charts and graphs. About 39 pages long.
Here is a snip.
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MODERN MONEY MECHANICS
A Workbook on Bank Reserves and Deposit Expansion
Federal Reserve Bank of Chicago
Foreign-Related Transactions for the Treasury
U.S. intervention in foreign exchange markets by the Federal Reserve usually is divided between its own account and the Treasury's Exchange Stabilization Fund (ESF) account. The impact on U.S. bank reserves from the intervention transaction is the same for both - sales of dollars add to reserves while purchases of dollars drain reserves. See illustration 35. Depending upon how the Treasury pays for, or finances, its part of the intervention, however, the Federal Reserve may not need to conduct offsetting open market operations.
The Treasury typically keeps only minimal balances in the ESF's account at the Federal Reserve. Therefore, the Treasury generally has to convert some ESF assets into dollar or foreign currency deposits in order to pay for its part of an intervention transaction. Likewise, the dollar or foreign currency deposits acquired by the ESF in the intervention typically are drawn down when the ESF invests the proceeds in earning assets.
For example, to finance an intervention sale of dollars (such as that shown in illustration 35), the Treasury might redeem some of the U.S. government securities issued to the ESF, resulting in a transfer of funds from the Treasury's (general account) balances at the Federal Reserve to the ESF's account at the Fed. (On the Federal Reserve's balance sheet, the ESF's account is included in the liability category "other deposits.") The Treasury, however, would need to replenish its Fed balances to desired levels, perhaps by increasing the size of TT&L calls - a transaction that drains U.S. bank reserves. The intervention and financing transactions essentially occur simultaneously. As a result, U.S. bank reserves added in the intervention sale of dollars are offset by the drain in U.S. bank reserves from the TT&L call. See illustrations 35 and 36. Thus, no Federal Reserve offsetting actions would be needed if the Treasury financed the intervention sale of dollars through a TT&L call on banks.
Offsetting actions by the Federal Reserve would be needed, however, if the Treasury restored deposits affected by foreign-related transactions through a number of transactions involving the Federal Reserve. These include the Treasury's issuance of SDR or gold certificates to the Federal Reserve and the "warehousing" of foreign currencies by the Federal Reserve.
SDR certificates. Occasionally the Treasury acquires dollar deposits for the ESF's account by issuing certificates to the Federal Reserve against allocations of Special Drawing Rights (SDRs) received from the International Monetary Fund.(21) For example, $3.5 billion of SDR certificates were issued in 1989, and another $1.5 billion in 1990. This "monetization" of SDRs is reflected on the Federal Reserve's balance sheet as an increase in its asset "SDR certificate account" and an increase in its liability "other deposits (ESF account)."
If the ESF uses these dollar deposits directly in an intervention sale of dollars, then the intervention-induced increase in U.S. bank reserves is not altered. See illustrations 35 and 37. If not needed immediately for an intervention transaction, the ESF might use the dollar deposits from issuance of SDR certificates to buy securities from the Treasury, resulting in a transfer of funds from the ESF's account at the Federal Reserve to the Treasury's account at the Fed. U.S. bank reserves would then increase as the Treasury spent the funds or transferred them to banks through a direct investment to TT&L note accounts.
Gold stock and gold certificates. Changes in the U.S. monetary gold stock used to be an important factor affecting bank reserves. However, the gold stock and gold certificates issued to the Federal Reserve in "monetizing" gold, have not changed significantly since the early 1970s. (See chart.)
Prior to August 1971, the Treasury bought and sold gold for a fixed price in terms of U.S. dollars, mainly at the initiative of foreign central banks and governments. Gold purchases by the Treasury were added to the U.S. monetary gold stock, and paid for from its account at the Federal Reserve. As the sellers deposited the Treasury's checks in banks, reserves increased. To replenish its balance at the Fed, the Treasury issued gold certificates to the Federal Reserve and received a credit to its deposit balance.
Treasury sales of gold have the opposite effect. Buyers' checks are credited to the Treasury's account and reserves decline. Because the official U.S. gold stock is now fully "monetized," the Treasury currently has to use its deposits to retire gold certificates issued to the Federal Reserve whenever gold is sold. However, the value of gold certificates retired, as well as the net contraction in bank reserves, is based on the official gold price. Proceeds from a gold sale at the market price to meet demands of domestic buyers likely would be greater. The difference represents the Treasury's profit, which, when spent, restores deposits and bank reserves by a like amount.
While the Treasury no longer purchases gold and sales of gold have been limited, increases in the official price of gold have added to the value of the gold stock. (The official gold price was last raised from $38.00 to $42.22 per troy ounce, in 1973.)
Warehousing. The Treasury sometimes acquires dollar deposits at the Federal Reserve by "warehousing" foreign currencies with the Fed. (For example, $7 billion of foreign currencies were warehoused in 1989.) The Treasury or ESF acquires foreign currency assets as a result of transactions such as intervention sales of dollars or sales of U.S government securities denominated in foreign currencies. When the Federal Reserve warehouses foreign currencies for the Treasury,(22) "Federal Reserve Banks assets denominated in foreign currencies" increase as do Treasury deposits at the Fed. As these deposits are spent, reserves of U.S. banks rise. In contrast, the Treasury likely will have to increase the size of TT&L calls - a transaction that drains reserves - when it repurchases warehoused foreign currencies from the Federal Reserve. (In 1991, $2.5 billion of warehoused foreign currencies were repurchased.) The repurchase transaction is reflected on the Fed's balance sheet as declines in both Treasury deposits at the Federal Reserve and Federal Reserve Bank assets denominated in foreign currencies.
You prepare for production of a product in the future by researching the target market, designing it to fit the needs in features quality and price, planning the production process and ordering the equipment, etc.. You then produce product, send it to market, promote it, and try to get the price you planned on.
Everything here is one person "guessing" the proclivities of another and supplying the other with what one hopes is the desired product and hoping the other will pay the expected price, or perhaps more.
Because of this perpetual guessing, we learn to value differences, and learn to cooperate. We trade for mutual benefit but without knowing at any one time what the value of our efforts would be for our partners in trade. They don't know what their purchasing power will bring in the future either. How many of Block's bagels will the Dunkin Doughnut baker be able to get for his dozen?
Any one have any theories as to why FX volume is off by a quarter recently?
Given that the majority of the volume is speculation by banks, I can only come up with 2. The very knowledgable interbank traders, with their fingers always on the pulse of the market, can either be long, short or flat. They are flat when they have no opinion, or don't understand what the H is going on, so anything could happen.
Either there are a lot of positions being sweated currently, (which would reduce turnover, and implies interbank trader concensus which would be difficult, and most unusual) OR there is a lot of interbank traders who are flat.
The other major currency flows are from investments, (in which case everybody is holding their breath) and trade. I don't see enough change in trade flows to suggest a significant change in FX flows. To the contrary, if one considers one of the biggies, hydrocarbons, I would think there is a case for increased action.
Looking for the Truth.....Central Bank Gold......and GATA
(uponroof) Jan 08, 23:46
Your looking to unlock a riddle that you must first define. The riddle has as many false paths as it does true ones. The true paths surely include quite a few twists and turns designed out of greed, for our head spinning benefit.
The crime here is about fixing the price of a supposedly 'free trade' commodity. It has nothing to do with capitalism, but everything to do with our laws. IMHO we are past the legal letter in principal, but perhaps not so in court.
The moral hazzard compromise that stretches back to the 1930's, involves a piss poor ESF policy that has now bastardized the world economy through double standard commodity trading/selling for dollar strength, gold.
If anyone really wants some frontline opinions on what is happening to gold, and how the Central Banks play the game, dig into the GATA site first. It will give you an overview of who's doing what. Suggest you use the search engine to your advantage and key the word 'lease' for starters. Lots of other good words to search like 'selling gold', '1%' or 'payback'.
http://www.egroups.com/messages/gata/
After that, read the headline stories and commentaries at The Golden Sextant.
http://www.goldensextant.com/
These sites were started by different fellows who had the same goal and were equally skilled at interpreting the screwing they (we) were getting with their (our) pants on.
When your fighting people who have influence gained through all the money in the world, and can then change the laws when the money isn't enough, it's a tough fight....
But one that can certainly be won.
All the pieces are starting to drop into place.
The failing market.
The coming recession.
The change in Administration.
The ever increasing energy crisis.
The unrest in key areas of the world.
Public opinion is in each of these, and unbeknownst to them now, turning pro gold.
As if gold is being prepared for greatness, despite and in contrast to the manipulations of those who would hide the truth from the world.
GATA....(the same courageous men who run these sites)
is about to be "at the right place, at the right time".
ALL:
If you haven't had a chance to support this cause don't delay. A correct understanding of what's going on in the end will be a hollow victory if the reservation to help monetarily now, out of a lack of complete understanding, becomes a regret later.
Don't wait until you figure it all out. Support GATA NOW!
The main reason is the drop in the number of trading partners of size.
Mergers and acquisitions have reduced the number of counterparties over the past couple of years. European banks have purchased many brokers and dealers, from Banker's Trust to Republic, Donaldson Lufkin and Jeanrette, and many more. In the US, bankers have merged as Chase bought Hambrecht and Quist, and then merged with Morgan, and so on.
The effect is that the interbank markets are falling in size relative to the bank's outstanding positions. This will soon pose a problem of "trade with whom".
Many houses are finding themselves in a squeeze on profits as newcomers eat their lunch from the bottom, and where size matters, someone had just merged into an even larger bank, fired 1/4 of the people and closed 1/4 of the offices, and now can offer more services at a slightly lower price, which drives you to get the same savings.
CALGARY, Jan 8 (Reuters) - The growing natural gas crisis in North America will result in two new pipelines being built to connect Arctic reserves to existing lines in northern Alberta instead of just one, analysts said on Monday. Gas shortages, which have led to record home heating bills and power outages, have refocused industry efforts to tap into known reserves on Alaska's North Slope and the Mackenzie Delta in Canada's Northwest Territories. U.S. benchmark gas prices rose 45 cents on Monday to $9.73 per million British thermal units, almost quadruple year-earlier levels. Two groups of companies, one in Canada and one in the United States, are studying the feasibility of transporting gas to the lower 48 states and are expected to announce their decisions later this year. Previously, industry observers had suggested only one pipeline would be built. But analysts now say a pre-Christmas announcement by BP Amoco (quote from Yahoo! UK & Ireland: BP.L) that it will explore for gas in Canada's Mackenzie Delta means two new Arctic lines are in the works. BP Amoco, like Exxon Mobil Corp. (NYSE:XOM), is now a major leaseholder on Alaska's North Slope and the Mackenzie Delta. ``With that announcement, BP is playing both sides of the border, so they obviously believe there will be two pipelines,'' said Tom Ebbern, analyst with Newcrest Capital Corp. ``We see the Alaska Highway line being fast-tracked - even though it is more expensive - because there will be a huge cry for energy security in the U.S. and gas is the only thing the Americans have to play.'' Currently, some 8 billion cubic feet a day of gas is being re-injected into Alaskan North Slope oil wells because there is no pipeline traversing Canada's far north to connect with existing systems in Alberta and British Columbia. Ebbern estimated the Alaska line could be onstream by 2005, while a line to the Mackenzie Delta could be commissioned two to five years after that. Tim Holt, president of BP Amoco's Canadian arm, agrees. He said gas producers should work toward formulating a development plan for the entire region in the face of forecasts showing gas demand could outstrip supplies from traditional sources by as much as 4 billion cubic feet a day within a decade. Another proposal that would see an undersea pipeline connecting Alaskan reserves to the Mackenzie Delta and then heading south through Canada won't proceed because of the political implications, said another analyst. ``The politics are already in play here and there are going to be two pipelines because of the politics,'' said John Mawdsley of FirstEnergy Capital Corp. ``Exxon and BP know it's not the most economic way to go, but they have to please Alaska, its natives, the U.S. federal government, Canada and the natives in the Northwest Territories.'' A spokesman for Canada's Imperial Oil Ltd. (Toronto:IMO.TO), which is 70- percent-owned by Exxon Mobil, said his company has launched a study to evaluate the feasibility of developing onshore Mackenzie Valley natural gas only. ``Can the North American market take two Arctic pipelines?'' said Hart Searle. ``We're trying to figure that out, but we don't know at this point.''
Black Blade: Meanwhile, natural gas supplies continue to run out and the Grasshoppers are screaming for relief. The current energy crisis is having a real drag on the economy and is showing up as a factor in many earnings warnings. You can't create "paper natural gas" to solve this problem. When the fires go out at the power plants, try to create energy with "paper natural gas." This current economic recession is about to take a severe turn for the worse. Also heard a portion of Gov. Gray Davis blasting the "profiteering" energy companies for the energy crisis in the Peoples Republik of Kalifornia, and that they will not take it anymore. I say good! They should just turn off the switch from other states and let Gray put that in his pipe and smoke it. These quasi-communists like Gray are at the very least entertaining to watch as they twist in the wind.
WASHINGTON (Reuters) - The U.S. government warned Monday there is no end in sight for expensive natural gas prices this winter, predicting consumers will face a 70 percent hike in heating bills from last year. While California's dire power crisis has received the most attention, the rest of the nation is also facing tight supply, strong demand, and a return to bone-chilling winter temperatures after several years of mild weather. Those factors have escalated prices for natural gas, a fuel used by consumers and by power plants to make electricity, the Energy Information Administration said. The EIA, the statistical unit of the U.S. Energy Department, issued a gloomy outlook for Americans dependent on natural gas to heat their homes and businesses. Consumers will see their heating expenses for natural gas rise 70 percent for the winter season of October through March, compared to last year, the EIA said. Previously, the agency had expected winter heating costs would soar 50 to 55 percent for natural gas. Colder temperatures that have blanketed much of the nation in recent weeks mean many Americans will have to buy more fuel -- at higher prices -- to heat their homes this winter. Midwestern states depend mostly on natural gas for heating, and consumers there will pay an average $927 to heat their homes with natural gas this winter. That compares to about $540 last winter, the EIA said. ``About 55 percent of the total U.S. heating market uses natural gas,'' said Dave Costello, an analyst with the EIA. Households in Northeastern states use more fuel oil. They will see fuel oil heating bills about 40 percent higher this winter, at an average $1,061, despite a slight decline in per-gallon prices in recent weeks. The slightly lower prices are being offset by colder weather that requires more fuel, the EIA said.
California Worse Off
California has been hit even harder. Wholesale natural gas prices in the nation's most populous state are roughly double that of the rest of the country due to the state's dire problem in filling demand for gas-fired power plants, and inability to import fresh supplies, the EIA said. The higher gas prices in California translate into skyrocketing electricity costs. ``The critical power situation in California highlights the inter-related tightness in both electricity and gas markets,'' EIA said. ``As environmental regulations on coal and oil fired generation units have become more strict over the last few years, gas fired generators began to take on more of the baseload burden. And as power generation demand has increased, demand for gas has increased with it,'' said EIA. The EIA said it saw no immediate end to the problems in California, noting the nation's most populous state lacks pipeline capacity while it has low hydroelectricity and nuclear power available and ever-increasing demand for power. ``Also the region is short on the electricity generating capacity and transmission wires to deliver enough power into a market that is growing at 4 percent annually,'' EIA said. California Gov. Gray Davis was expected to unveil a plan late Monday evening to tackle the state's precarious power situation and help two major utilities avoid bankruptcy.
Dwindling Stocks Of Natgas
Nationwide, the EIA called the jump in U.S. natural gas prices ``unheard of,'' and blamed it on fears that stocks or storage levels of the increasingly popular fuel were too low. ``For much of the summer, low levels of underground storage raised concerns about the availability of winter supplies. Now that the winter has really started, the most severe assumptions about low storage levels have come true,'' the EIA said. These low levels of storage have hit wholesale natural gas markets hard, with spot prices at the wellhead breaching a record $10.00 per thousand cubic feet on four separate days in December. Government analysts forecasted prices for natural gas at the production wellhead would average about $6.23 per thousand cubic feet for the entire winter. That would be more than two-and-a-half times the price of last winter. ``Never have spot gas prices at the wellhead been this high for such a sustained period of time,'' EIA said. Prices were expected to retreat from their winter highs this spring and summer, but wellhead prices were likely to remain about $4.00 per thousand cubic feet in 2001.
Black Blade: A little over optimistic IMO. Get a lot of blankets and start chopping wood. Get gold and silver as hard asset portfolio insurance as the equities markets continue to tank. Shades of 1929 are around the corner.
Ultimately there is a "trading with whom" but for the interbank FX transactions, there is always the CB's and other biggies around the world. What is more I have seen traders within the same desk taking opposite sides of the same trade, and individual traders both long and short for different reasons at the same time.
My experience with FX interbank trading desks says that it is a profit center unto itself, and the field is very capital oriented, the more capital you can command the more you are, or should be IN. As long as a trader is profitable (at X percent of utilized capital) he has no fear of losing his job. I have seen some physical restraints on that, ie the trading room during a merger wouldn't hold all the people, and the weaker had to go. But by and large, they don't like to let profitable people go. Besides, if that were the case, the remaining few could simply add a zero, and the volumes would probably even grow. Moreover, looking at the numbers, the timing does not make sense.
But Voila, this train of thought has brought up another idea. A trader also ceases trading when he is ordered to do so, most commonly when the capital of the bank is encumbered. Given the panic passage of HR4541 and the sudden rate cutS, along with the attendant speculation that there is trouble in bankland, and we have another possibility. This one is even more frightening than the previous.
Black Blade, - is the heating oil and gasoline shortages
`Is the heating oil shortage being replaced with a gasoline shortage?
Futures are showing gasoline recovering and surpassing its normal premium to heating oil (HO).
From the normal 5% premium of unleaded over HO, it fell to a 15% discount, and has just now gone over the normal range to indicate a premium over 5%.
By the way, the originary interest contribution of the energy sector is enormous this year - particularly this winter. Originary interest being the discount of future goods to current goods (an arbitrageable condition - putting the lie to Black Scholes).
The crude oil part came to 35% at the peak at Nov. Fell to 11%, and has now gone back towards 20%. HO gives similar numbers. Nat Gas, is phenomenal at 80%, up from 12 to 20% prior to the Nov - Dec price spike. Considering that expenditure on NG and oil are 7-8% of the economy (GDP base), that is a contribution of 1.9% to interest rates at the peak oil price, and now at high NG prices we have a 2.1% contribution, 2.7% including crude - and this should be manifest in the spread between non government and government paper
Just this last week I had some data on the heating oil supplies. Unfortunately I cannot find it now. The heating oil supplies have been pumped up a bit with some refined oil out of Europe. Of course, natural gas is used by five times as many homes for heating than those using heating oil. Most of the heating oil use is concentrated in the northeast US. Natural gas is not imported as easily except by pipeline from Canada. One should note that NG prices in Europe are much lower as a result. The problem for the US is that many have equated oil with natural gas, and that worked well when the US had cogeneration power plants that could use both. However, EPA regulations with regard to carbon credits (AKA pollution credits) limited the use of so-called "dirty fuels" such as oil and coal in favor of NG. Therefore, virtually all new power plants are NG-fired. Unfortunately, the "great" minds of Wall Street and the Government never thought of the pressure that would come to bear on the NG supplies. To compound the problem, when petroleum prices cratered, the industry mothballed and scrapped drill rigs as many drill manufacturers and drillers went tits up. Drill rig day rate are increasing almost daily as no adequate drill rigs are available. Some companies such as Nabors Industries (NBR) are scavenging junkyards in order to piece together drill rigs. Add to that problem the fact that experienced drill rig crews are not to be found. Many left the industry for more stable employment when petroleum prices last cratered. Most will never return. In fact, many companies are hiring recently paroled felons to train as drill rig workers. Also, several petroleum geologists and other professionals also left the industry. Some friends in the oil patch tell me of Russian and eastern European Geologists who are working in the Gulf as mudloggers and petroleum geologists. The universities in the US simply don't produce that many geologists anymore. Another major problem is that most likely targets for NG are off-limits. The ANWR (Alaska National Wildlife Refuge) is one such major target. Also, Bubba just signed a new executive order that nationalized 58.5 million acres that cannot be explored unless George Dubya rescinds that (he has 60 days to do so). So it would seem that NG prices will not recover for several years. We will just have to get used to the idea of high energy prices from here on out.
Gold is down -$0.90. The US Dollar is pounding the hell out of the world's currencies this morning. Did Dim Wim give another interview? And market futures are down slightly. Could be interesting today. Meanwhile, NG is down, and oil is slightly higher.
Hong Kong--Jan. 9--Spot gold was capped by currency-related selling in Asia Tuesday despite scattered physical buying, dealers said. Spot palladium prices continued to rise in Asia in line with the limit-up of Tokyo Commodity Exchange palladium futures, dealers said, while spot palladium prices are expected to rise to U.S. $1,200 per ounce soon as fears of unstable Russian exports remain. Physical demand supported gold prices above $268 per ounce in the morning but the selling emerged at about $268.50-269.00, dealers said. The firmness of U.S. dollar against the Australian dollar triggered selling of dollar-denominated spot gold by Australian sources, they said. Spot gold is expected to move in the range of $267.50-271.50 in the near term, a dealer in Australia said. Japanese buying pushed up spot platinum to near $640 in the afternoon in Asia from near $630 early in the morning, dealers said, while the activity by players in other Asian countries on the metal remained thin. Although trading of spot palladium remained thin during Asia trading, it continued to rise on the lack of selling offers, dealers said. The price volatility in the past few days has led many dealers to widen the spread for their bids and offers to $50 from $30 last week, they said. As Russia's exports of palladium remain unstable, players have continued to squeeze the physical market, keeping the price on the upside trend, dealers said. "Many are talking about $1,200 now, it will come soon," a dealer said. He said the price would rise even if Japanese buyers suspend their buying in the near term. Japan is one of the world's major buyers for palladium, while Russia is the world's largest palladium exporter. Japanese buyers of PGM (platinum group metals) expect the first delivery for 2001 Russian palladium shipment under long-term contract to arrive in Japan on time in late January, BridgeNews reported Tuesday. Meanwhile, they don't expect spot palladium prices to remain above U.S. $1,000 per ounce for long, as the price is being supported by panic over unstable Russian exports in thin trading. In previous years, Japanese palladium end-users sold palladium in small lots in the spot market to cap the price, PGM buyer sources said. But, the end-users have stopped the selling after their repeated failures to push down prices, they said. TOCOM palladium rose in thin trade, hitting their limit-ups. TOCOM platinum futures rose on aggressive fresh buying and short-covering despite persistent profit-taking and fresh selling, TOCOM dealers said. The TOCOM April platinum contract and the most active TOCOM December platinum contract hit their limit-ups, they added. Many TOCOM dealers expect TOCOM platinum futures to see a correction in the near term, as spot prices may fall from the current high levels. "If I were a TOCOM speculator, I wouldn't open fresh longs on PGM. They look too crazy for me, but PGM have moved against our expectations," a Japanese dealer at one major Japanese brokerage said.
Black Blade: $1200 oz. Palladium? Hmmm� Quite possible as the Russians don't have any left. Their stockpiles are depleted. Gold prices look to be under pressure as the US Dollar is beating the crap out of the world's currencies over the last couple of days.
Palladium scales heights beyond $1,000/oz in Europe
LONDON, Jan 9 (Reuters) - Palladium scaled fresh peaks beyond $1,000 on Tuesday and spurred platinum towards a 13-year high as Russian supplies remained absent from the market, traders said. Palladium hit $1,037 an ounce at the London morning fix, up $7 from a previous high set on Monday, while platinum reached $632, just below last week's 13-year high of $638. ``It's basically the same scenario as we've seen over the past month -- buyers and absolutely no sellers,'' one Europe-based trader said. ``And it's not going to come down from here until we start seeing some Russian selling in the market,'' he added. While key supplier Russia delivers platinum regularly to the market, its palladium deliveries are more erratic, and traders said worries that the metal would fail to appear this month as promised were responsible for the price spike. Japanese dealers said on Tuesday U.S. buyers were the main palladium purchasers at present since Japan signed long-term contracts with Russia in December and had no reason to buy at current high prices. The metal, used mainly in autocatalysts to clean noxious engine exhaust emissions, was trading at around $100 four years ago and has more than doubled in value since last year. Dealers said this might have encouraged consmuers to buy platinum as a subsitute. However, they noted thin volumes were currently exaggerating price moves. ``Volatility remains the order of the day for the palladium market, with very thin conditions giving rise to wide price swings,'' Canaccord Capital analyst Rhona O'Connell said in a report. The market's erratic behaviour meant highs and lows were difficult to estimate, she added. ``While the market's mood has a toppy feel to it, there is just too much uncertainty to call a turn. There is no doubt that prices will come off, and potentially sharply, when Russian metal appears,'' O'Connell said. ``The longer term prognosis for demand remains a cause for concern, but the degree to which Russian supplies are fashioned to meet demand levels will be the key.'' Spot platinum was quoted at 1115 GMT at $630.00/$640.00, compared with Monday's New York close of $629.50/$635.50. Palladium was at $1,030.00/$1,040.00, from $999.00/$1,019.00.
GOLD, SILVER HEMMED IN RANGE
Gold and silver failed to mount similar rallies, and were pinned in the middle of their current ranges, traders said. ``Gold has made a slight recovery from $267.50 this morning but it's going to hold around here for the moment,'' one trader said. Support for gold was seen at $267, with resistance at $270. ``If it stays around here ($268) for the next few days we should see it break resistance,'' the trader said. Spot gold was last indicated at $267.90/$268.30 from a close of $268.30/$268.80, while silver was down one cent at $4.55/$4.57.
NEW YORK (CBS.MW) -- Morgan Stanley Dean Witter's top economist on Monday told clients to brace for a recession in the United States and the possibility of a "full-blown global recession." "We are shifting to an outright recession scenario in the United States, and, in response, we are slashing our forecast of the global economy for 2001," Chief Economist Stephen Roach said. "The risks remain very much on the downside, and I would now attach a 45 percent probability to a full-blown global recession," Roach wrote in a note in clients. He cut his expectation for 2001 growth in the global gross domestic product by 17 percent to 2.9 percent, with the assumption of a U.S. recession accounting for about half of the downward revision. The firm's economists now see the U.S. economy contracting by around 1.25 percent annualized in the first half of the year. Morgan Stanley is more bearish than many on Wall Street, with most economists still expecting growth, however small, in the first half of the year. The firm has ratcheted down its global growth estimate by a steep 1.3 percentage points in three months. "This paints a picture of a $32 trillion global economy that has essentially turned on a dime," he said.
More downside potential
As relatively bearish as the call is, Roach said in an interview that there's a risk of further slowing. "There are lots of risks to the downside. Recessions tend to take on a life of their own," he said. The research has forecast "the mildest of all possible recessions. The risk is that this goes further and longer than we think." Some of the larger worries for Roach are the "unwinding" of anything to do with technology -- that is, from spending on information technology to the tumble in tech stock prices. The rise in energy prices in the United States are also likely to hurt the U.S. economy as consumers face higher usage prices. Other worries listed in his report include: a California shock from the dot.com and utilities woes and a "seizing up of the credit intermediation process reflecting mounting concerns with credit quality."
Europe a haven
Europe emerges as something of a haven in Roach's scenario, thanks largely to the recovering euro, which has appreciated sharply against the dollar recently. He pared estimates for European growth for 2001 by 0.3 percentage points to 2.2 percent; "that would leave Europe growing at double the pace of the U.S." Europe should also benefit as direct exposure to the U.S. is limited, with exports to the U.S. account for 2 percent of GDP for the region and because fiscal stimulus "is set to kick in this spring," he said.
Black Blade: Looks like the US Dollar is being boosted the last couple of days. Probably an attempt to head off capital flight to Europe. Meanwhile, mutual fund redemptions are accelerating. Looks to get much-much worse.
http://quote.yahoo.com/m2?uFinland's market has crashed! Down 9.63%! This could get interesting in the US markets, especially in the telecoms as Finnish telephone manufacturer Nokia is a very large institutional holding. Nokia is getting ripped a new one in overseas trading. Janus Funds has inordinately large positions and could suffer a meltdown today. Keep your eyes open!
For gold-addicts, the perception of POG, being low, suffices to buy physical. Gold-movers, don't make a physical move on gold, as long as they are not convinced it is a rightout steal. Goldmovers are not fooled by a vaque perception. POG's behaviour, since the dollar-turn, is giving evidence of the above. Paper-gold is guiding its profit-missils to the setted price-targets.
267$ / ounce must be perceptive cheap to a broad but unbuying, majority. They know that 267$ and below is affecting, goldproduction, now. The more that hedging at these pricelevels is unrewarding and becoming very dangerous.
Value-players, must still be sticking on their dollar. They must be confident that the 105/100 US$-index will hold.
The don't bother the dollar being a paperbag, filled with huge piles of debt. This paperbag is still dry and will get wet under 105/100. With the Dow, breaking under 10.000, being the wettening rain.
PriceOG, isn't volatile enough to seduce enough would-be players to organise some swinging. No aspirine for the pain-proces.
It is a great pity that no form of goldproducer/miner is taking part on the discussions at this or other gold-forums.
Today's rumor of De Beers, having an affair with LVMH is or should be inspiring for goldminers. I don't understand their attitude and in particular to this forum, who consist in majority of clients-goldbuyers. Is it a kind of arrogance ?
WGC, says, it will work on the gold-selling nations, outside the 15 WAG participants. WGC will provide these countries with sound argumentation to stop selling and give evidence as to why, accumulate gold. But they are only a one man + one horse workforce. Again, some disturbing contradiction added to the already mountain of inconsistancy.
2/3 th (or 100.000 tons) of above gold is investment-gold.
The holders of this gold must be re-motivated and re-educated, about the true meaning of holding it. Fifty years ago, De Beers, was marketing, diamonts, with the "For Ever" slogan. 100.000 ton holders are still waiting for that vital support, from the gold-diggers-sellers. Car producers (etc..) are also forced to produce, automobiles in function of evolutive buyers. Is the creation of a World Gold Bank, such a stupid idea ? Why can't this be realised to give an example to the selling CB's ? A Gold Bank that invites world-traders, to avoid the disadvantages of currency-wars.
Shareholders of this Gold Worldbank, that want to put their reserves in a gold-accumulater that is giving an example to UK / SUISSE and others. Give your mined gold and underground reserves : Added Value !! Dampen the speculative aspect of gold and create TRUST !
The aboveground gold is supposed to be as much as the presumed underground-reserves. Isn't it time to reconsider the future of that second half part of gold to be mined ?
OPEC is facing the same problem. Banlancing on future reserves - POO and energy-alternatives. When goldproducers are running out of profitable underground gold...what are they going to do ? I would prefer to have a gold-bank, nextdoor.
LONDON ( Dow Jones ) --Pressured by thinning trade and the prospect of a rise in producer hedging and official sector sales, the price of gold will fall sharply this year, said a report by trade house Mitsui ( MITSY ) . In his precious metals forecast for this year, analyst Andy Smith said the outlook for gold is bleak, with a low of $210 a troy ounce possible. Even a weakening dollar and the threat of a looming global economic slowdown won't be enough to prevent gold from dropping below the 20-year lows of around $252/oz plumbed in 1999.
Gold last traded as low as $210/oz at the end of 1978.
In a gloomy outline of the market's prospects this year, Smith said mining companies and central banks - the
largest holders of underground and aboveground gold reserves, respectively - will be tempted to start selling
ahead of further weakness. For miners, this means selling production forward, a likely consequence of industry consolidation as hedging reduces the overall costs of acquisition, Smith said. For the official sector, it will mean selling gold, then investing the receipts in more attractive financial assets. With the proliferation of asset classes in recent years, gold is losing its allure. Even traditional gold buyers such as Indian consumers will start looking to invest elsewhere, such as bank deposits, Smith said. Demand looks weak, and gold is unlikely to be seen as a store of value in a global economic slowdown, he said. Gold is currently trading at $268/oz, and last traded above $290/oz, Smith's most bullish forecast, at the end of June 2000.
One of my most frustrating experiences for several years is that I always have to wait until it is all over before I find out what happened, ie Greider's, "Secrets of the Temple" and Woodward's "Maestro". The hard facts presented in those books and the inside thinking involved we great reading for historical purposes but they are no guide to the future, without timely information. Common folk like me do not generally have access to the pertinent facts/information, on a timely basis. For that reason I began to track interest rates for myself in order to have timely information.
On this forum several have expressed an interest in more than just seeing an occasional chart depicting the yield curve. We need information that is timely. I have 40 clients, all that I can handle, whom I cautioned about 3 months ago to prepare for recession in 2001. My caution has been based upon the only indicator (for the common folk) that has shown itself to be dependable. If I am right and my clients follow my advice they will be ahead of the curve and suffer less for it. If I am wrong none will be hurt. Why? The simple advice which I have given in order to prepare for recession is good advice in any economic environment, just especially more so in bad times. In bad times this pre-emptive planning may make the difference in survival for the very small businesses which pay me for my service.
This is not a solicitation. I do not want even one more client. I have all I can handle and hope to go into semi-retirement soon.
The following information is as timely as I can get it:
During the last 6 months of the year 2000 the interest rate spread for the 10 yr note vs the 3 month T-Bill was inverted by an average of 46 basis points while this spread for the entire year was only plus 3 basis points on average for the entire year.
During the last 6 months of the year 1989 the interest rate spread for the 10 yr note vs the 3 month T-Bill was inverted by an average of only 3 basis points while the spread for the entire year was plus 10 basis points.
"A prudent forseeth the evil, and hideth himself: but the simple pass on and are punished." (Prov. 22:3)
Thank you for your comments on the currency flows Oro. The GDP model was an off-the-cuff idea as I was writing and I was curios if anyone had looked at that. So your quick response is much appreciated.
In response to Beesting's comment that gold speculation can be agonizing, I have been actively speculating in gold related investmenst for the past five years and thus I have a first hand familiarity with the agony you are referring to. In order to maintain my sanity, I try to retain a sense of humor whenever the market humiliates me and reminds me that my own hubris is my worst enemy.
A. Smith / S. Saville / Prechter...etc : as long as there is no sound evidence of physical gold buying...POG, will slide towards the minus 200$, attraction target. Ridiculous or not. Price manipulation or not. It was possible to sell Dot.Bombs at mania prices to the masses of individuals and supposed sophisticated investment funds. The opposite is possibly happening with gold. The stockmarket had to reach an almost vertical hyperbole to induce some dizziness.
A justified perception of a low POG is most probable not enough to induce physical buying. Market and psychology of the masses (Gustave le Bon).
Gold needs a shock-effect. We must reach the point of no alternative. Gold-movers must be pushed into physical gold,
through lacq of any alternative. That is the damaging result of a 20 yrs slide. We must have the courage to face this ugly reality. It does not imply that we are wrong doing in accumulating gold, further in time.
US-government Bonds and the dollar are the only investment alternative left ! The dollar must crash (below 100-index)
to give gold a chance. We know the reasons why it should crash. We also are prepared to give this crash plenty of time.
Prognostication, please! @ORO, TG, justamereBear, Hill Billy Mitchell, Stranger, Randy, Peter Asher, auspec (& anyone else bold enough)
Hi ORO, TG, justamereBear, Hill Billy Mitchell, Stranger, Randy, Sir Peter, auspec!
There's an awful lot of expertise here, and it just struck me this morning, we're under-utilized ;>
How about a few consensus-type questions to get an idea where "the room" thinks the dollar is going, how long it will take to get there, and how long it'll stay?
Who knows, something like this could become a regular feature?? And a compilation might attract more lurkers. Heck, we could become as popular as the "Shadow Fed" or even Alan Greenspan's "brief-case indicator!" Then everyone will be exposed to gold, free-market banking instituted which will lead to a defacto new gold standard - - - - and we'll all live happily ever after!!!!
What can I say. I just woke up.
Anyway, here are four questions to attempt a jump-start in that direction.
1. What are the odds of a dollar melt-down of more than, say, 25%?
2. What's your best guess as to the most likely final equilibrium dollar index (or percentage drop)?
3. What is your best guess as to time frame to the bottom? How long do you think it will take?
4. What is your best guess as to the duration of the economic effects? Will it be like Japan's ten years -- or more like 1987?
I realize such predictions are, ah, Yogi, but your feel for the situation, coming from such unique perspectives, might be akin but superior to the Fed's prognostications. Based on a hard-money perspective, you-all might beat the Fed's 60% accuracy rate!
Hope you don't take offense at being mentioned in the same sentence as "Fed."
Regards,
Journeyman
P.S. Edison International and PG&E bonds were down-graded to B- (junk bond status) by Fitch Global. -Steve Fetter, Fitch Global, CNBC, Jan. 9, 2001 ~11:31AM
Granted, there's a fundamental problem with the transparency of the gold market. However, forgetting the "gold as money" rationales, gold "the commodity" is in supply deficit. Holtzman is quite right placing CB's in the category of "mines" BUT, with the WA, supply from these above ground "mines" is in check is it not? Therefore, with most mines unable to extract gold from the ground at a cash cost of 200, where is gold the "commodity" going to come from; where? You can't make it up on volume. Let's not forget the demand that might ensue with gold trading at those lows. Mr. Smith has been referred to by gold enthusiasts as a "highly paid shill" and I would agree. Mitsui is a Japanese firm. We know that Japan is loaded up on dollars and NOT a large holder of gold in their reserves.
I overheard several employees in my store in a heated discussion. When I listened in, they said they all just got their gas bills. One went from $130 to $320, another went from $210 to $780, and another said it cost her $1,700 to fill her 1,000 gal. propane tank. After hearing panic in their voices I can't imagine what's going on out there if millions of people are getting the heat bill, credit card bills from Christmas, and IRS tax forms all at once. When asked what they would do, they all said stop eating out, defer bills that aren't mandatory, and spread payments out over the whole year. Sounds like the hard landing to me.
CNBC caller, obviously a little older guy, says, "My portfolio is down 43% year over year. What can I do to get it back up?"
Bill Griffith, the moderator, and his guest look at each other meaningly for a second, then give an answer that amounts to "Why ask us. We don't know."
How to Voice Your Opinion Directly to Gold Mine Management!
http://biz.yahoo.com/prnews/010109/ca_homesta.htmlHomestake Mining Company to host a conference call Feb. 7 2001 8:00 AM (PST) 11:00 AM (EST).
Toll free in the U.S. and Canada 1-800-450-0785.
Outside the U.S. and Canada 612-322-0342.
Gold "the commodity" in supply deficit : we don't know how much gold-deficit there is or will be ! The figures 4.000 ton demand / 2.500 tons production and X tonnes scrap...are repeated ad nauseum, without solid evidence ! I do not take the WGC figures. WA = 15 countries. We have evidence of sales (leases) by other countries. Mine production at 200$ cash costs : as long as there are mines that can hedge...they will keep on hedging even at their own peril.
Demand at 200$ is jewelry-demand. But the jewelry-industry takes a profit of 300%. And at a certain level...price, doesn't matter that much anymore, for obtaining, a much desired golden chain. The jewelry industry is a master in playing POG into their sale strategies.
Investment gold does not care what the price-level is. Gold investors start buying gold when they run out of liquid alternatives. A minus 200$ price, acts only as a strong eye-opener. An overshooting always attracts opportunists, who might induce a visible upwards price-trend. The gold-movers want to have maximum insurance that their move is succesfull. They stay aside, when in doubt. See POG-behaviour.
Japanese, holding dollars are possibly, repatriating when a certain pain-level is reached and the dollar Titanic has hit the iceberg. If POG could signal such a possibility...anticipation, could manage to make an up- price-trend visible. Then I see a possibility that Japanese will give gold a chance, with a small portion of their dollarholdings.
The dollar-index "Big picture" is still in a rounding bottom pattern. This Big picture gives no indication of a future catastrophic crash. On the contrary ! A nasdaq retracement to 3.000 is even possible. The Dow hasn't broken its psychological support of 10.000. We have a tendency to sell the bear's skin before he has been shot. The devastating down-wave on the stockmarket hasn't yet materialised.
IMO, the US will not suffer a 10 yr Japan debacle. Because of the complete different culture. But what if the Nikkei hasn't yet seen its lows yet.(what I presume) And the japanese, don't withdraw a softening dollar ? It is impossible to guess anyones intentions. A run to their own Yen is not going to help them out of their deflation debacle.
We can only chart the movements and speculate on certain characteristic patterns, building up and on some vital breakpoints. (support-resistance)
For this reason, I was expecting and looking out eagerly for POG to show some anticipative signs. There aren't. The two failed breakouts, have done a lot of psychological damage.
That's the reason I must conclude that there are no gold-buyers out there at the moment. But with a dollar/stockmarket/intersest decline...the alternative choice becomes smaller. A strong rising Euro would cause a terrible economic slow down. Hyper-deflation also leads to moments of panic.
If the POG were to go down to $200.00 per oz couldn't that be because the Paper Gold Pricing Mechanism is breaking down and burning, and wasn't that what Another, FOA, and others have predicted? White Hills
LOS ANGELES (Reuters) - California's embattled public utilities on Monday hailed Gov. Gray Davis' plan to end the state's electricity crisis and save them from bankruptcy but said action was needed within days or they could run out of money to buy power supplies.
Consumer groups had a mixed reaction to the plan,predicting that the public would wind up paying the bill.
``While the governor's statements are welcome, we are concerned that unless strong steps are taken over the next few days, the financial crisis ... will bring us to the point where we can no longer buy electricity and gas for our
customers,'' Pacific Gas and Electric warned in a statement.
Southern California Edison (news - web sites), the state's other major troubled power company, said it was ``pleased to hear the governor recognize again the importance of ... financial stability and (the) role utilities play in providing reliable and affordable power for the state of California.''
Southern California Edison, which has also warned that it has only weeks of cash remaining, added that ``urgent action is needed to allow us to continue (playing) this essential role.''
Bankruptcy Not An Option
Davis told the state legislature that California could not afford to let the utilities go bankrupt. ``I reject the irresponsible notion that we can afford to allow our major utilities to go bankrupt. Our fate is tied to their fate,'' he said in his annual State of the State speech.
Stock prices in the parent companies of the two utilities rose Monday in advance of the speech.
But it remains to be seen if Wall Street thinks that Davis has gone far enough. He provided few details about how Edison International unit SCE and Pacific Gas and Electric, a subsidiary of PG&E Corp., would be kept from failure. He made no mention of a utility-backed proposal to issue state bonds to pay off billions of dollars of unrecovered power costs.
That omission left consumer groups fearing that Davis' support might result in higher electricity bills for customers. ''He has not addressed who will pick up the tab for this debacle, and still all indications are that it will be the consumers,'' said Doug Heller of the Foundation for Taxpayer and Consumer Rights.
Opposition To State Bonds
Consumer groups are strongly opposed to issuing state bonds to pay off utility debts, saying that would force customers to pay higher rates for the next 10 years.
``He did not say anything about (the state bond proposal), which means it is either not on the table or perhaps, more likely, it will be the unspoken bailout,'' said Heller, whose group has urged Southern California Edison to divest overseas assets to raise cash.
The two utilities, which together serve more than 70 percent of California's 34 million residents, have run up a total of about $12 billion in costs buying power that they cannot pass on to consumers because of a legislated rate freeze.
Severin Borenstein of the University of California Energy Institute in Berkeley told KCBS radio that California had ``done the rest of the country a great favor'' because other states would ''approach deregulation with a lot more care than California.''
Bill Called ``Dangerous Failure''
Davis branded California's trailblazing power deregulation legislation, which was passed in 1996 and enacted in 1998, ``a colossal and dangerous failure.'' Twenty-three states already have passed some legislation deregulating their power markets.
Heller, of the Foundation for Taxpayer and Consumer Rights, welcomed Davis' strong attacks on power producers, which included this passage:
``Never again can we allow out-of-state profiteers to hold Californians hostage. Never again will we allow out-of-state generators to threaten to turn off our lights with the flip of a switch.''
``(Davis) sounded like he was ready to stand up to profiteering generators,'' Heller said.
A chronic power shortage triggered the state's power crisis, driving wholesale prices to unprecedented levels and resulting in many supply emergencies. Grid managers frequently came within a whisker of ordering statewide rolling blackouts last year.
The state's power shortage stems from surging demand, linked to a buoyant economy. And there have been no major power plants built during the last decade because of uncertainty linked to deregulation legislation.
Beowulf - Do you think the Grasshoppers are planning on confiscating the ant property in order to serve their own needs?
As you and I well know, before you can follow it you must be able to identify it. So, let's start with the changing hands aspect of (Fiat) money. At every instant this legal tender totality is in the hands of some one who has just delivered, promised, won, benefitted or stolen to get it. They now are poised to demand goods and services with it, turn it over to others to do so, or surrender it to authorities or the more recognized criminals.
Internally, we are entering a sudden surprising shift in who posseses the current "Product demand notes" as they shift percentages from home heaters to NG providers. Quantifying that change and predicting the spending intentions of the holders of the new windfall would be a logical first step as this is the current "grenade" that has been thrown into the room.
After that, we should attempt to see in our crystal ball, what is changing in international dollar flows as the Stock Market has ceased to provide the gargantuan function of turning investors funds into consumer spending money.
I personally see a fall in the dollar as a good thing! When foreign money gives American consumers purchasing rights in exchange for a stock certificate there is greater demand for goods and services but less incentive for the local folks to pick up the tools of production and create them. If the dollar reverses enough to make a difference then the "free lunch" from overseas is replaced by a foreign market willing to pay our guys for some PRODUCT instead of gambling chips.
The massive money supply now in existence is still in somebody's hands poised to be spent on whatever appeals to the holders. Who holds what? What will they do with it? How will that effect foreign trade in goods and currency? Those are the questions: Yes?
I look at it from the nuts and bolts viewpoint. Of your list just now, we have ORO on the monetary desk, possibly the most sane and astute analyst on the planet for this. We have you for free trade, HBM charting the waters, Stranger on the Markets, TG, Randy and auspec on the Gold angle and J-Bear as a free agent.
Like the childhood skit of all the guys with different twisted mouths, getting together to blow out the candle., maybe we can figure it out.
Well, yes; that is one possible explanation/scenario. There is the FOA/Another reason to buy gold and then there are all the other reasons. I do believe as the US fundamentals deteriorate, gold will be sold by large players because a rise in POG is to their detriment. POG is still the dollar's bogeyman and will be. Gold stocks should lead because POG is problematic. Gold stocks should respond due to inflation. Otherwise, physical is best bet. Absolutely anything could happen (at any moment). Where for art thou safety? Sorry for the rambling got to go...CM
On the Motley Fool website, someone must have posted a list of 12 reasons to own gold. One of their readers posted a reason not to.
One reason not to: society will not pay you to run scared and put your capital into yellow metal...
put your capital in things that advance mankind, and get approprite returns...
http://www.thespiritof76.com/bigfloat.html I think most are familar with the theory of "Big-Float: The American Damocles" but for those who aren't, I've included the link.
In keeping with this theory and the notion that Greenie and the Feds can not support BOTH the falling markets with lower interest rates and the weakening dollar with higher rates, then it would seem the dollar's fate rests in the hands of the powers that be as to which will be supported.
If rates are lowered to attain a "soft" landing, then the dollar weakens and perhaps we see the return of Big-float.
If rates are raised to support the dollar, then the soft landing turns into a skydive with no parachute. It's quite a choice with IMHO both roads leading to recession unless the two can somehow be balanced. Perhaps the policy makers have a solution I haven't heard of? I have no doubt that they are immensely smarter than I but as Journeyman has stated, perhaps not smarter than the efforts of this combined forum! Were their inside information available, I for one, wouldn't bet against the brainpower here.
This is not intended to give anyone a swelled head but is offered as a compliment to any and all so puff out your chest and strut around if the mood strikes you!
Rich
Which society would that be? Maybe the one we wish for but certainly not the one we have. If it comes down to some serious "Running scared" this society will pay through the nose trying to catch up to those of us who are outrunning the Bear faster then they are!
Says the reason, "society will not pay you to put your capital into gold, so put your capital into things that advance mankind, not into yellow metal".
That's just what I'm doing, I'm letting those more intelligent than I am, advance the welfare of mankind; let those more intelligent hand over their gold to me, they can have my "capital" and I wish them lotsa luck with it, advancing the welfare of mankind.
TRAIL GUIDE? WHO IS A GOOD RELIABLE SOURCE FOR EURO DOLLAR ACCOUNTS?
Hello TrailGuide and all Knights&Ladies,
I have been following this wonderful group for the past year+.....
Your here is quite remarkable with his ability to leed one down the 'Golden Path'.
I have noticed many discussions of the Euro(dollar bonds/accounts).
Would you please be kind enough to recommend or point me/us in the right direction of how and where to get started :+)..smile....
I also want to say thank you for all the numerous postings and hours you must of spent with this GoldForum.
I applaud you!!!
thank you in advance for your kind consideration in helping me to obtain more information for a Euro Account.
You are talking sense, indeed. The large investors are waiting for the sign, to invest. But, shrewd as they are, when the sign comes, it will be too late - in my opinion.
As for why gold is not being talked up by the producers, and why there is no World Gold Bank (certainly we wish there was one!) well, first of all, it must be domiciled somewhere. And, there is no place anywhere on earth willing to take on the U.S. (and Britain?) and permit the establishment of such an entity.
Not even Saddam has the guts to call the U.S.'s bluff. Nor does Iran, or anyone else, Japan included.
They know that to take actions that break, or intend to break the control of the price of gold, means a DIRECT ATTACK ON THE USA! It means a war to destroy the U.S. empire based on the Dollar. It would amount to "casus belli" a reason for all-out shooting war.
There's Soros - he's shrewd, but not insane. It's one thing to make billions, another to declare war on the U.S.!
The WCG knows this. It explains their lack of action.
Those of us who believe in gold as the ultimate victor, can only bide our time, and wait for the fundamental irrationality of the paper economy of the world, to run its full course. May be a long time, I'm afraid. But it might not. No one knows.
For the time being, there is not a human being or organization on this planet, willing to "Bell the U.S. cat".
I hope with this little illustration, I can get you guys to see what is happening, and will continue to happen regarding dollar, gold and Euro. I will throw in a few other tidbits on the way.
A 'soft landing' means that they clean you out, little by little, over period of time instead of a couple of days.
Simple isn't it.
You shoot one Palestinian kid stone thrower
a day, that is 365 at the end of a year, but no public outcry, as one a day is hardly news. But, shoot 365 in one day and you have a serious problem. IT GETS NOTICED.
A good bartender (or is it a bad one?} could get away with stealing a $1 a day from his employer. But go a whole year playing honest Jim, then take $365 and he's out on his ear.
I hope I have made my point.
This 'soft landing' bit does not upset the end result. It just means they get to keep their skin.
Will they get to keep their skin - you bet!
You guys have absolutely no idea who is running this so. Do you think they are quaking in their boots at GATA, or any other voices that may be raised? Do they mind you knowing, or guessing gold is being manipulated? Not a bit. In fact they kind of want you to know. PROVING IT IS A DIFFERENT MATTER.
When TPTB got the American public to swallow the verdict that Oswald killed Kennedy in the light of all the evidence.
Then, a short time later 'a lone gunman' eliminated the other member of the duo who were going to get to grips with what they saw as America's biggest problem, manipulating the gold price (which they have done for years anyway) was no problem. Manipulating the gold price does not necessarily always mean holding it down. Letting it go up, when the timing is right and in their favour, is manipulation.
How do you make something go up? By creating the set of circumstances that will bring this about. How do you divert a river; how do you reduce the flow of a huge river to a trickle? The Chinese have just dammed the mighty Yangtze - a much more difficult feat than manipulating gold, which 'they' control most of anyway.
They got the message through to the sort of people who have the kind of money that could be dangerous. Because, if they can keep them away from gold, they won't excite us chickens who are weak individually, but could be a little problem collectively.
The name of the game is to bring the dollar down GRADUALLY (no sudden shocks). The river of money has to be diverted into the Euro GRADUALLY. There must be no sudden shocks to the system.
There must also be no other diversions, like GOLD.
I e-mailed Jon Kaplan (Goldminingoutlook) some time ago about what was happening. He wouldn't accept that gold was being manipulated. He even advised buying gold shares until just before Christmas. Then he stopped updating. When he resumed after Christmas it was to tell us he had sold all his mining shares.
Below are sections of just two of my e-mails in which I was
telling him that palladium and platinum had taken the place of gold and silver as a 'safe haven' for the 'big boys', the ones you would need to kick-start any goldrush.
Now, I ask you, why on earth are these two metals shooting for the stars and leaving gold and silver dead in the water,
and sinking below the gunwales? Please don't tell me it is because they are used in automobile exhausts, and the like.
Car manufacturers are cutting back all over the world. (See my snippet, that is just one of the many).
How many of you took the trouble to read a posting by
GM SLASHES OUTPUT AGAIN
The world's largest automaker said it expects to produce 1.2 million vehicles in the first quarter, down 21 percent from the year-ago period. On Dec. 7, it projected first-quarter North American plant output of 1.301 million cars and light trucks.
Parts of my e-mails to 'Goldminingoutlook'. of some weeks ago
"............ It should be sinking in now that all this is resulting from a well planned and orchestrated attempt to smash any potential threat to that over-bloated piece of paper they call the US dollar.
The only people capable of smashing the dollar, gold, or any other currency, have a vested interest in not only keeping the dollar afloat, but 'king of the road'.. The more it bucks the trend of the economic fundamentals which point to its potential decline (which is daily), the more it illustrates the power of those who are behind its facade of strength.
I can understand many not seeing this organised deception ( I hate to use the word conspiracy, as the word has become a Hollywood clich�), because they are unable to comprehend the inestimable power of those who are behind it, and their ultimate objective.
Most people see what has (and still is) happening around the world as isolated incidents. People scratch their heads when trying to understand the often confused reasoning behind their individual causes. All kinds of explanations are thrown up, all of them way off beam. Only when you take everything as a whole and see how it fits in to the agenda (the real 'new paradigm') does it make sense.
Their is no antagonism towards gold itself - only what it stands for. On normal economic 'fundamentals' there is no reason why palladium, and platinum should be going so strong one way, while gold and silver go the other.
Platinum, and palladium do not have the psychological image for the common man, as does gold. Few people know how to invest in them, or what mining companies produce them, and, strangely enough (not really), there is little education from the media.
However, the 'elite' who may in the past have invested in gold have been using these other two metals as their 'hedge'. They have been quietly preserving, and improving their wealth, while those who thought they were being prudent and all foreseeing clung to their belief in gold.
"....... Maybe you should change your website to "platinumining outlook.com" Doesn't quite have the same ring, but at least you won't suffer the screaming ad-dabs whenever you have to think of what encouraging words and advice you can offer your subscribers. And you won't lose them money...."
"..........Just after sending you my e-mail 'Is the message coming through' I saw this. Robinson is a geologist and authority on South African Mining. The article is from Today's Financial Times,
"If you look at the history of South Africa," says Mr Robinson, "the 19th century was the century of diamonds, the 20th the century of gold. It appears the 21st will be the century of platinum......."
Copyright � The Financial Times Limited
Even Asia is swinging to Platinum, and both China and India are importing large quantities
How many of you took the trouble to read the posting #45283 by Goldenbacher, if you had you would realise just a little of what you are up against. It discloses hardly the tip of the iceberg.
In 'their' defence I have to say that they (or at least some of them) believe they have been ordained by God to bring unity, and peace, to the world. They believe that when the agenda is complete they will have brought heaven to earth and that we will all enjoy the fruits of their master plan. The end will jusify the means. Maybe they are right. I hope to God they are because there is no way to stop it.
When Churchill was executer of the exchange, I think in the 30's he took England back to the gold standard. As I understand it, it was a miserable failure and caused havoc in the economy. What really happened and why did it fail? I thought perhaps some brighter minds out there might be able to help me out with this question.
Sierra,
I'm afraid Soros is one of "them". He has close ties with the Rothschild's, he's really not much more than a wealthy puppet. just type into a search engine, "soros, rothschild, illuminati" and see what you come up with. We all need to open our eyes and see the big picture, it is almost unbelievable.
Sorry if i offend any body, but all views must be looked into before we can see the "real" truth.
"The Istanbul Gold Exchange has reported that Turkey's gold imports jumped by 91% during 2000 to 205.3 tonnes;
Taiwan's Finance Ministry, meanwhile, reported that Taiwan's imports of gold bars and coins during 2000 were 17% up at 99.6 tonnes."
"Based on the PM London gold fix, the average price of gold during 2000 was $279.10, barely changed from the $278.57 average in 1999. The year's highest PM fix was $312.70, seen on February 4; the lowest PM fix was $263.80 on October 27."
---
My note: How many people are there across the land wishing their stock assets held up so well as gold over the past year? And now, as domestic prices certainly seem set to rise at increasing rates as energy costs escalate and the Fed endeavors to liquify the banking system, which asset do you believe is best positioned to perform well into the future? Turkey is your good example that failing currency within a nation can result in brisk gold business. Can you envision the physical strains under a scenario in which the deep pockets of the U.S. citizenry move for gold, too?
Post # 45292Is it my imagination that by simply asking pointed questions, to those who quite likely know the answers, I can make people simply disappear? I'm going to now test this theory once more.............
These questions are for Christian, our Esteemed Leader, pandagold{?}, belgian{?}, and anyone else that is in posession of "uncommon knowledge" in regards to the following topics:
Black Gold issues
Vatican Gold issues
Ft. Knox Gold issues
ESF & Friends, BIS, LBMA & Friends
My post # 45292 asked more complete questions in these regards. Maybe we can set up a "anonymous" posting method so these key questions can be answered-- Deep Throat? I have no doubt that there are folks among us that can explain much of what is REALLY going on. There is much murkiness among us for good reason, but dammit the pupil is ready for the answers- where is that teacher?
Best to all!
ECB weekly financial statement reflects that assets have swollen with the addition of Greece as a member nation
As reported here last Thursday regardsing the European Central Bank's final weekly financial statement for the year 2000, the gold assets of the Eurosystem totalled 117.073 billion euros following the quarterly mark-to-market revaluation process. In this first consolidated statement with the inclusion of new member, Greece, the total Eurosystem gold assets for this first week of the new year (week ending January 5th) are now 118.615 billion euros as reported through Bridge News.
In similar fashion in the paper arena, the ECB's consolidated foreign currency assets swelled from 254.5 billion euros to 261.4 billion euros.
Offering a brief recap of thoughts offered last week .... we can see the two reserve models at odds now that the euro has established a meaningful uptrend against the dollar. As the much-discussed price discovery mechanism leaves gold listless with respect to the dollar, the strengthening euro exchange rate translates into a shrinking level of reserve assets when quoted in euros.
As such, if the extant gold pricing mecahnism does not allow for a separation from derivative structure ties with the dollar under future weakening of the dollar, just imagine the potential for additional physical demand at the hands of rising foreign currencies that cannot be supported. Continue to buy gold now and bide your time.
Yikes! HOF? Surely you jest (thank you, I'm trying to say ;). Just back from the road, with the IRS/& client on the other phone line, so of course I check in here first opportunity when things get boring. Do I get rewrite rights? Things are much clearer on later readings. It would be better if I can get what I was trying to say on that first try out better if it's gonna stick around for awhile. Will be back later this evening.
Yesterday eve, I was at Las Vegas airport talking with a very intelligent gentleman about investing. This chap had "taken his lumps", sold off his losses, and held onto some equities he, "knew would come back". He was aware of the period roughly 1972-81. I suggested his investment horizon might extend 10 years or more. He said fifteen would work.
My investment in PM is likewise "medium to longterm". The foundations are quaking. Control is slowly being lost to natural, immutable laws. Time is on my side.
I am not a financial advisor nor investor. I am a survivalist. When the rumors of Y2K first surfaced,I started to acquire some precious metals to diversify my portfolio,
as you all say. The past year or so I have been following
a few sites with forums concerning Gold and Silver. The commentary has been from most informative to comical. Thanks
you for many hours of pleasant reading. Now, Gentlemen, some
postings have me concerned about recession/ depression or is it soft/ hard landing. My greatest source of information about "The Crash of 1929" and "The Great Depression", were my grandparents. One thing that was mentioned most was never trust the banks! I have read the Howe lawsuit and I find it very well presented and in my opinion highly credible. It is
nice to buy gold/silver at bargain prices. Still one has to contemplate the cascading effects should the price of gold
reach very high levels. Will the days of The Great Depression be revisited? If the goverment goes to a gold standard, will they confiscate the very gold we are buying
now for the protection of our familys and loved ones?
Have noticed my bullion dealer has been doing some very good business. How do I know? I count the moving types of
coins in his display and see what the change is the next time I visit him. Just an observation. This is my first time posting and my advise for the simple investor as to buying gold is simular to gambling. If you can not afford to lose
the money you should not be gambling in the first place.
In closing, may this year be profitable for all of us without too much disruption in ourlives. But having my cake and eating it too would be nice.
All comments Appreciated GO GOLD GATA F.O.A.
I hope to post again tomorrow. Will then comment on several posts given over the last few days.
USAGOLD (Michael) (or Randy),,,,, I could give some names of banks that offer Euros? But I think CPM could/should advise most any client as they do gold business in Europe.
For Americans that are non-residents (or simply don't have a place there)of the Euroland Zone or England, an Offshore savings account in Jersey (Channel Islands)or Isle Of Man would do fine, I think? But there is far more to cover with this than I would ever get into in public. Again, CPM is the place to ask these questions and seek direction.
I don't know about transfering into Euros in a bank but can tell you the exchange rate can be "played" with the use of futures and/or options. This is among the riskiest of ventures even for the most experienced and skillful of traders. It's almost an insiders only game. Depending upon where you live, you may find no one who will even welcome your business after you mention commodity trading.
So, educate yourself and then trade "on your own handle" if you want. It's extremely risky and, I believe, the greatest game in the world. Start with "How the Futures Markets Work" for basic info. It's by Jake Bernstein (who now recommends gold as a long term investment). Also, "Winner Take All" by Gallacher. Both are available in paperback. An account can be opened through any of the brokers who advertise on the commodities pages of the Wall St. Journal or Investors Daily but please don't jump in without studying first. It's estimated that approx. 90% of those who open accounts go broke in about a year's time. This is one reason why physical gold in hand is advocated, but learn and then proceed as you see fit.
Which sector? Istanbul represents buying of metal by "regular folks" as "regular" as folks get on this diverse spherical garden found amid the twinkling stars and blackness of space.
On the other currency item raised by Cris, if I were of a mind to open a euro account, I would likely do so with similar criteria under which I select a bank for my other accounts....too big or too smart to fail. But then, physical gold is where I personally "bank" much of my accumulated productivity...too real to fail.
Interesting thought.....I should invest to advance mankind. Hmmm, I Wonder what Ayn Rand would have replied to that idea?
Consider this point of view if you will. People speak of "putting your money into something". When one buys a stock, bond, mutual fund, ect. one is "putting one's money" INTO DEBT. When one buys GOLD one is putting money into MONEY. Bottom line, gold is the money you get to keep. Money placed into debt instruments is at the mercy of the debtor. Just how good are some of the 28 year old prodigies managing this debt? Are their intentions to grow the business and benefit mankind, (incedentally mankind is mostly broke), or make profits for the share holder? What happens in a debt collapse? Does mankind benefit from a bunch of reprobate CEOs and fund managers lying on the beach chugging rum?
The Englishman Samuel Johnson once said "Patriotism is the last refuge of a scoundrel". I once believed that was true. But perhaps in the post modern "global community" patriotism is the next to the last refuge. The last one may well be the "good of mankind".
I'm not totally opposed to debt instruments as investments, they have a purpose. But so does a home appliance. In todays debt ridden economy I fear that many debt instruments are about as wise as "investing" in a new toaster oven.
1c 1cThank you Friend, but this is about what my opinion of the dollar/economy is worth.......two cents, factored by the amount of fannie money created since that expression was.
Anyway, I am willing to ramble a bit. I started shorting "the market" somewhere near 1994 and was determined to continue {intermittently} until successful, yet giving up on that sucker's game at the start of 2001. Too many variables outside of normal market control, an irresponsible FED, PPT, and general political "games". OBVIOUS! This rather large balloon isn't going to deflate quietly, that is not history's lesson. The economical and social excesses will have to be wrung out together and it will take quite some time IMO. The rubber band is stretched so tight that a dollar drop of >25% has a slightly better than 50% chance of occuring, let's call a 33% drop to reach bottom.
As far as duration-- I think we will enter into what's called a severe and extended recession, but it will last no more than 3 years.
You know Jman, some of your best ideas come to you when you "just wake up"-----more CLHE stuff. I will get out of bed in the night to write down an idea or two and the next thing I know a couple of pages of deep thought has appeared.
I am generally an upbeat and optimistic soul, this is nothing but "realism" in my thinking as far as the dollar/economy. I tend to be early on a lot of big picture happenings so have had to learn to use more staying power. We all likely see something in current news that we have known and acted on for 10 years or so, just par for the course in this upside down/ backwards world. Our USA "bottom" as far as culturally/ socially is nowhere in sight, unfortunately. Hang on to your hat and your soul! Thanks for asking.
auspecfully yours
The financial markets, is it equity, credit or in particular derivative markets seem to have reached a terminable state of dislocation. Greenspan's papering over process of (dis-)stress does not have the desired effects any longer and while ever fewer believe the FED actions are intended to ensure a soft landing for the economy, as documented in sharply lower consumption - it's not the lower $ only!-, a feeling of un-easiness or queasiness is
creeping into new era goldilocks.
Household names as Ma Belle reduces dividends along with the stockprice to a fraction, Xerox, the synonym for copy is on the brink of bankruptcy, and even major utilities - almost as safe as T-bonds are tanking. Not to mention the
new economy, where most believers would probably wish they'd never heard the term.
It seems that Greenspan hit the panic button on something much more severe than LTCM et al combined. The BAC story may be the first clue to systemic risk, where the derivative club and their percieved hedges against, lastly themselves -see counter party risk management group - turns against their creators and AG as their defender (as in - casino capitalism is a great regulator of "paper" prices, therefor no inflation).
As we all don't really accept -yet, auspec- who played whatever roles in this game, we may be convinced that certain players you've mentioned, couldn't resist to play along, may have overplayed their hand by now. Though I still feel its typically the reaction of the greedy banksters, who can't miss a game, particularily if it used to be their game before the likes of GE started to invade their turf and quite successfully - to the end I'm kind a tempted to say.
So anyway, the last indication I've needed were Mssrs. Andy Smith and Ted Arnold, the infamous destroyers of goldbug vermin, in order to keep up the orderly retreat of the POG - and prolong the (in-)sanity of the system. A system now reduced to throwing mothballs by faded skeletons or better repetitive automatons towards a new aurea prima?
Let's watch the unfolding events send these ghosts of the past back to their destination of mothballed closets.
Times are indeed a'turnin'! cb2
Journeyman
Hi there my friend, I am indeed honored that you have me in this august listing. Or is it as you said at the end, or "anyone else BOLD enough"? Or is this a polite way of saying I spout off at any opportunity? Any way, thanks. Count me in for the first round at least, business is looking a bit frantic, so I do not know how much long term time I can commit. It sounds like fun, and maybe beneficial to all concerned. You never learn so much, quite as quickly, as when you are "teaching" ie up in front of an, at least, somewhat knowledgable crowd.
I want to say that your questions are good, but like most of this type of question a bit narrow. Take your perfect storm; it is a confluence of several events, not just one. In this case I think all roads lead to Rome, but there are many roads. The US dollar index is the SUM of the forces acting on it.
Anyway I intend to get a bit of shuteye before tackling this. To little sleep to think at the level your questions demand.
Peter Asher
Of course I was scolling down and read yours before Jouneymans. I was absolutely delighted, and laughed out loud at your description of me as a "free agent". I think you too, are a diplomat par excellance. Other people might have used a 4 letter word before the word "disturber". Many thanks.
What is LAW?
Sitting in my freshman business law class on the first day of school, the professor began the class by trying to uncover the definition of LAW. Some classmates said was a set of rules to abide by. Wrong, exclaimed the professor.Some classmates said it was principles of honor based on behaviour since the beginning of time incorporated in social justice that all men aspire to and demand from their fellow man. Wrong, exclaimed the professor! After no further responses from the audience could be solicited, the professor exclaimed: LAW IS THE ABILITY TO PREDICT WHAT A JUDGE OR JURY WILL DECIDE! WRONG OR RIGHT, JUST OR UNJUST, TRUTH OR LIE, BAD OR GOOD, DO NOT EVEN ENTER INTO THE PICTURE!
GATA and Reg Howe are barking up the wrong tree! There is no way they can or will win! Their efforts, time-energy-money should be used in taking the physical off the table, or as Christian says, learning to play the gold-credit creation game. THE JUDGE/JURY WILL SIDE WITH THE POWER/CABAL/NEW WORLD ORDER/SORROS/ROTHCHILD/ROCKEFELLERS/GREEENSPAN/IMF/ESF/BIS/
DEUTCHE BANK/CITIBANK/J.P.MORGAN/CHASE. Please to not turn me in to the ATTORNEY GENERAL of the STATE OF INDIANA for PRACTICING LAW!!!!!!!!!!!!!!!!!!!!
P.S.: Can the sheeple be stupid to have a negative savings rate and buying, buying, buying, when the fiat is soon to be worthless??????????
Journeyman, re your post 45326, I am an "anybody else bold enough" I'll bite. Everybody has opinions. On l-4,odds of an undefined meltdown, run 75% with a time frame from here of a continually sagging dollar against most currencies (those using USD backing get to sag together) with the results of a recession/depression (whether your job or someone else's) lasting for four or five years. And affecting much of the world. Yes. On the reasons for this self induced debacle, (A) The U.S. is rapidly losing an industrial base to more beneficial circumstances overseas with which to even compete internationally; most of the key producers being foeign owned anyway resulting in questionable autonomy (B) The balance of payments deficits does not re-set to zero each January l, it is cumulative and is an ungodly amount of money. Other creditors may not suffer wastrels with as much enthusiasm as does the U.S. Don't count on a helping hand...from whence? (C)Just as optimism can be somewhat catching in a business environment and otherwise, pessimism is also, only much much faster. (D) Almost nobody saves and everything except a pair of shoes (from China by the way) is financed. Maybe I live in the wrong place. People I run into don't even need a 60% increase in energy costs as Black Blade points out; they already are running sufficiently negative that someone is not going to get paid today and tomorrow and any downturn will vastly speed that up. (E) Twas a pleasure. Hope someone (for your own sake) agrees. I still do not have any workable answers.
What Is 'IT'? Book Proposal
Heightens Intrigue About Secret
Invention Touted as Bigger Than
the Internet or PC
Steve Jobs quoted on accomplished scientist's new
device: 'If enough people see the machine you won't
have to convince them to architect cities around it.
It'll just happen.' A venerable press pays $250,000
for a book on project cloaked in unprecedented
secrecy. EXCLUSIVE
Got a clue? Post your guess as to what IT is.
by PJ Mark
Tuesday , January 09, 2001 01:43 p.m.
Harvard Business School Press executive editor Hollis
Heimbouch has just paid $250,000 for a book about IT
-- but neither the editor nor the agent, Dan Kois of The
Sagalyn Literary Agency, knows what IT is.
All they do know: IT, also code-named Ginger, is an
invention developed by 49-year-old scientist Dean
Kamen, and the subject of a planned book by journalist
Steve Kemper. According to Kemper's proposal, IT will
change the world, and is so extraordinary that it has
drawn the attention of technology visionaries Jeff
Bezos and Steve Jobs and the investment dollars of
pre-eminent Silicon Valley venture capitalist John
Doerr, among others.
Kemper -- who has been published in Smithsonian,
National Geographic and Outside among others -- has
had exclusive access to Kamen and the engineers at his
New Hampshire-based research and development
company, DEKA, for the past year and a half. He tags
the proposed book as Soul of the New Machine meets
The New New Thing and won over his agent and
publisher with e-mails describing the project in carefully
couched language. He also included an amusing
narrative of a meeting between Bezos, Jobs, Doerr and
Kamen.
In the proposal, Doerr calls Kamen --
who was just awarded the National
Medal of Technology, the country's
highest such award -- a combination
of Henry Ford and Thomas Edison.
Doerr also says, a touch ominously,
that he had been sure that he
wouldn't see the development of
anything in his lifetime as important
as the World Wide Web -- until he
saw IT. According to the proposal,
another investor, Credit Suisse First
Boston, expects Kamen's invention
to make more money in its first year
than any start-up in history,
predicting Kamen will be worth more
in five years than Bill Gates. Jobs
told Kamen the invention would be
as significant as the PC, the proposal
says.
And though there are no specifics in the proposal as to
what the invention is, there are some tantalizing clues.
Is IT an energy source? Some sort of environmentally
friendly personal transport device? One editor who saw
the proposal went as far as to speculate -- jokingly
(perhaps) -- that IT was a type of personal hovering
craft.
Consider the following items, culled from the proposal:
IT is not a medical invention.
In a private meeting with Bezos, Jobs and Doerr,
Kamen assembled two Gingers -- or ITs -- in 10
minutes, using a screwdriver and hex wrenches from
components that fit into a couple of large duffel bags
and some cardboard boxes.
The invention has a fun element to it, because once a
Ginger was turned on, Bezos started laughing his ''loud,
honking laugh.''
There are possibly two Ginger models, named Metro
and Pro -- and the Metro may possibly cost less than
$2,000.
Bezos is quoted as saying that IT ''is a product so
revolutionary, you'll have no problem selling it. The
question is, are people going to be allowed to use it?''
Jobs is quoted as saying: ''If enough people see the
machine you won't have to convince them to architect
cities around it. It'll just happen.''
Kemper says the invention will ''sweep over the world
and change lives, cities, and ways of thinking.''
The ''core technology and its implementations'' will,
according to Kamen, ''have a big, broad impact not only
on social institutions but some billion-dollar old-line
companies.'' And the invention will ''profoundly affect
our environment and the way people live worldwide. It
will be an alternative to products that are dirty,
expensive, sometimes dangerous and often frustrating,
especially for people in the cities.''
IT will be a mass-market consumer product ''likely to
run afoul of existing regulations and or inspire new
ones,'' according to Kemper. The invention will also
likely require ''meeting with city planners, regulators,
legislators, large commercial companies and university
presidents about how cities, companies and campuses
can be retro-fitted for Ginger.''
The invention itself is as interesting as the inventor.
Kamen -- ''a true eccentric, cantankerous and
opinionated, a great character,'' according to the
proposal -- dropped out of college in his 20s, then
invented the first drug infusion pump; he later created
the first portable insulin pump and dialysis machine.
Beowulf - Do you think the Grasshoppers are planning on confiscating the ant property in order to serve their own needs?
Black Blade, looks like this answers your question.
Article:
Gov. Gray Davis wants California government to confiscate generating plants and build new ones - virtual socialism for the electricity-starved state's privately owned power industry.
According to a report by the Associated Press:
In his annual State of the State address Monday to the California General Assembly, the Democratic governor of America's most-populous state made the sweeping proposal to "prevent generators from driving consumers into the dark and utilities into bankruptcy."
Davis called for creation of a new state agency, a public-power authority authorized to:
� Use the power of eminent domain to seize power plants now generating electricity in California and
� To buy and build new state-owned power plants to generate additional electricity.
"Make no mistake," the governor told legislators. "We will regain control over the power that's generated in California and commit it to the public good."
He denounced California's venture into a gradually deregulated electricity market as a "colossal and dangerous failure," leaving consumers with the prospect of huge rate increases and two giant investor-owned utilities on the brink of bankruptcy.
"It has not lowered consumer prices and it has not increased supply," Davis said. "In fact, it has resulted in skyrocketing prices, price-gouging and an unreliable supply of electricity - in short, an energy nightmare.
"The time has come to take control of our own energy destiny."
Davis also asked lawmakers to:
� Force California utilities to hold on to their remaining generating plants and to sell their power in California instead of out of state.
� Order those power plants now down for unscheduled maintenance to go back on line.
� Allot the state attorney general $4 million to investigate whether power suppliers manipulated prices.
� Set aside $1 billion of taxpayer funds to help stabilize electricity prices and generate additional energy.
� Restructure the boards that manage the state's power grid.
� Make it a criminal act to withhold deliberately power from the state grid if it threatens public health or safety.
� Overhaul a "crazy bidding process for electricity."
� Stabilize prices by making it easier for utilities to buy electricity through long-term contracts.
� Provide low-interest financing to build more power plants designed to be used during periods of high demand.
� "Re-power" existing plants to make them cleaner and more efficient.
� Make available state-owned land as sites for more generating facilities.
Davis' threat of eminent domain and a public power authority brought praise from Doug Heller, a consumer advocate, formerly a severe critic of the governor on energy issues.
Heller he said the governor also should have called for an excess-profits tax on power generators to repay consumers for rate hikes.
Duke Energy, one of the major power wholesalers in California, said that seizing plants and creating a state power authority would "do nothing to produce power."
Vowing that Duke would fight any attempt to confiscate its power plants, a company spokesman, Tom Williams, said:
"California needs to increase supply and as rapidly as possible. We're willing to develop any kind of solutions to increase supply and anything that can be done to reduce demand."
Related article. Sorry, no link.
New York--Jan. 9--The Clinton Administration is attempting to keep California's two biggest utilities from going bankrupt, due to concern that the companies will be unable to continue buying power and could plunge the state into blackouts, an Administration source told BridgeNews. However, the administration wants the issue ultimately settled by the states.
Story Developing............
If California is the trend setter for the rest of the country, as has long been stated, then watch out for a socialist takeover of a state government near you.
Please ask your law professor to look up these famous words and see who wrote them:
"When in the Course of human Events, it becomes NECESSARY for one......"
A hint, it is 224 1/2 years old....Thank you....beesting.
Very interesting last post. I agree with the premise, if it could be re-stated this way-
"What does it mean to practice Law"
Law, in and of itself, is not a guess at an outcome of a trial. Although the guess may be calculated and scientific, and highly accurate, and this no doubt is an art practiced by lawyers. No argument from me here...
If you look at the roots of Law in Western societies, they are based either closely, or loosely, on the Ten Commandments. And the Ten Commandments are the Word of God.
(BTW, they are not the Ten Suggestions) So in my opinion, which I will state no matter which Phd (Piled Higher and Deeper) will scoff, no matter the titter of disbelief that will wave over the room, I will state that Law is the Word of God.
Without a unified Law, each would be a law unto himself, each turned to his own way, doing what is right in his own eyes. This is moral relativism, which is not incompatable with a secular system of laws of man, where the common good is provided for, which on the surface seems to be the essence of Law, to provide a stable social environment for the good of all, with small concessions of personnel freedom, in exchange for an orderly process of living together. But Law is more than that, it goes deeper, to matters of the heart, fairness in love relationships, victimless crime, where no one seems to get hurt, like cheating on taxes. Law goes to the heart of man, and requires that he do what is right and honest. So Law is not just a collection of popular dos and donts assembled by mortals, but it is a divine sword, that discerns the thoughts and intents of the heart. If Law were only the creation of man, it would stop at the external things, and once the external things were made clean, the soul could rot in a cesspool of decay, for man is only concerned with the external. But Law goes inside, and proves the debasement of all mortals, so as to expose the need for forgiveness. See, thats the thing, none of us measure up, and we all need to be forgiven. Thats what the whole body of the Law of Moses is about, to show perfection as an smooth, vertical wall, covered in teflon, and if you are honest with yourself inwardly, you have to admit that you dont measure up to absolute perfection, and the Law convicts us of this all the time. Unless one has been sucessful in beating down ones conscience with a mallet, until it no longer bothers you. The only problem comes when the self righteous claim to be following the Law, with their external practices. They preach a religion of phonyness. And if you are honest inwardly, this type of religion should make you feel sick inside, for it is of man.
The apostle Paul said, the Law is a schoolmaster, to bring us to Christ.
RE:What is 'IT'(P.A.) and thank you for the info :+)
Hello P.A.
I heard about this IT project a couple years back..
actually it is called ..a one person solarpower and fuel cell vehicle. IT, comes in 2 models; either solo or for 2 person.
It will fly effortlessly using an onboard computer to do most all the navigation.
From what I heard, it will cost under $2,500 and will be a turning point in the future of our 21st Century.
The inventor of IT or Solo Trek also patented a Wheelchair that can climb up and down stairs!!
so I guess for about Ten Gold Eagles we can all be flying to the Moon if Gold doesnt get their first..
smile..
cris
I don't know if you got an answer to your question about FX volume. In case not, I think I or someone posted here about two days ago an article that explained this in terms of converging interest rate worldwide.
The law of the West is a development of the Roman law and could easily be recognized by any practitioner without any reference to the ten commandments or god, not singular not plural.
European history shows two parallel systems of law, a common law loosely based on Roman law, and a religious law. The religious law being practiced by church or rabbinate, the common law practiced by the people for their own good using judges of repute and juries chosen by lot from among the people at hand. A minor law of military tribunal was developed seperately. All systems required the the parties to agree to being subject to court jurisdiction explicitly or implicitly.
As late as the end of the 18th century, the common law courts in many areas were still independent of government (then constituted of a few large kingdoms and many small principalities loosely associated to one king or another. At times, the court would even move across borders of various sovereignties in its traditional circuit.
Law was accepted by people much the same way as currency was accepted by the commercial market. The court and its law were accepted by a long process of trial and error to accomodate the practices of the people, particularly in commercial law, and to compromise with the claims of ecclesiastic courts and the sovereign's statutory law administered by tribunal.
The Judeo-Christian biblical law did not enter into things because most people could not read or write, and copies of the bible were only available to the church. The common law courts deferred to the religious courts on all matters of religion, and therefore did not incorporate religion into law directly. The separation held because the church wanted it so, in order to maintain its monopoly on the soul and its judgment.
RE: Beowulf, Boxman, barnacle bill (nice diddy BTW), and Chris Powell
Beowulf #45333 and Boxman 45363:
It was inevitable. That is why I refer to them as Grasshoppers (per Aesop's fable) because they have no concept of personal responsibility. Of course they will confiscate the Ants property. They have done so in the past. I recall several years ago when the state confiscated property in order to build highways. They did not provide reasonable compensation either. With the Peoples Socialist Republik of Kalifornia's stellar record, I would suspect that they would even screw up a confiscation plan. They certainly couldn't run the power plants because government simply does not work, and they can't cross-state lines to confiscate out of state power plants and natural gas producers. Since these Grasshoppers are not producers, they will have a difficult time if NG producers refuse to sell (read give) them NG. I would think that NG producers would service their local clients ahead of the Kalifornia Grasshopper at weaker prices. Gray Davis, nice communist that he is, is only trying to remain viable as a possible presidential candidate for 2004.
Barnacle bill #45336:
Why not have both? Some people feel that investing in the newest hottest mania or in hard assets is an all or nothing proposition. I have done well with good diversification. Gold is simply a diversifier that adds a measure of insurance to my portfolio. I have made out on dot.coms and bailed out with some gains, even though I knew that it was a speculative mania, but I also held other stocks as well as PMs. If things get as rough as I expect, I think many here will be glad they had PMs in their portfolios. History is on our side. Also, you might ask these people why do they think that Warren Buffett, Bill Gates, Paul and George Soros hold large investments in PMs.
Chris Powell #45366:
>>>>BASEL, Switzerland, Jan. 8 (Reuters) -- Central bank shareholders of the Bank for International ettlements voted unanimously on Monday to buy back all shares from private shareholders, ignoring threats of a legal challenge.
The BIS, an international institution that serves as a bank to central banks, stuck by a plan to pay 6,000 Swiss francs per share for the 72,648 shares, or 13.73 percent, of its total capital its member central banks do not yet own, despite objections from some private shareholders.
However, some private investors are not satisfied.
SocGen First Eagle Fund has filed a complaint in Manhattan.
BIS General Manager Andrew Crockett said BIS records showed the SocGen has 5,000 shares outstanding, but the company said it had 9,000 altogether.
Separately, in the United States, gold analyst Reginald Howe has also filed a suit against the BIS alleging
that it colluded with other central banks to depress the gold price. Howe also claims that the BIS is offering private shareholders less than fair value.
Crockett said there were two further complaints in the pipeline. One of these comes from the French firm
Deminor.
Deminor has threatened a dozen top central bankers with legal action if they approve the buyback, saying they think the offer is 53 percent lower than the BIS's net asset value.
Deminor's Fabrice Remon told Reuters, "This is an outlaw operation. There were no checks and controls. The central bankers have set the rules of the game to suit themselves. We're going to take this to the courts." He said Deminor would probably make its move as soon as next week. <<<<
Black Blade: As it is said � "He who has the gold makes the rules" (the Golden Rule).
http://www.bearforum.com/cgi-bin/bbs.pl?read=99113I've been on the road a couple days, with a printout of the Gold Trail for passenger-seat and bedtime reading. Wow, wow, and wow. It gets clearer each reading (last was 4-5 months ago) how clear a teacher FOA is. Read it again, soon.
Here is a BearForum description of useful hedging and speculation, vs speculation on momentum under a credit excess system (entire following by Koala Bear):
"I would say that there is stabilising and destabilising speculation.
Stabilising speculation is a form of time arbitrage. It means that you find short-term pricing anomalies and you supply or withdraw liquidity from them so as to push the price back towards the mean.
In exchange for absorbing some of the risk of the market,
the speculator earns a profit. The rest of the market benefits from a lower risk (volatility) profile. Pure hedge funds are supposed to look for arbitrage opportunities while controlling their risk through the use of hedging. At their best they help to make the pricing mechanism faster and more responsive. They help to maintain the law of one price. They supply liquidity to otherwise thinly traded and mispriced asset markets. They are undoubtedly value adding.
And they are part of the reason why capitalism is so efficient.
The problem though, is that in a system that is as distorted as ours, where credit is created at a whim by a vast state-organised cartel (i.e. the whole Central Bank system), the nature of the game changes. The optimum strategy alters from stabilising to destabilising.
In destabilising speculation the game becomes to predict what "they" are going to do next. To catch the fastest moving target and hop on for the ride. This is momentum trading and it creates the volatile, bubbly market we are now observing. Destabilising speculation tends to push the system further and further away from equilibrium and rational pricing. The ultimate conclusion is massive malinvestment, culminating in violent crashes. "
Obviously Davis is trying to run for president of the Democrats by using the classic Democrat ploy of creating disaster, then blaming the private market "savior" for it and confiscating the solution. It may wash with some of the old Cal grasshoppers, but Cal has a big non-grasshopper population that may dump him if he is not convincing. How many is he going to alienate by the time he takes hold of the power plants and finds that (1) no one is willing to build any power supplies in Cal, or sell to them. (2) That State construction costs and time tables would be slower and more costly by 30-50% (on both numbers) and (3) the Grasshoppers will end up paying more for electricity than anyone on the West coast. He will have about the same chance Gore had of winning his home state.
--NY Feb crude up 5c amid surprising yet small API stock drop
--NY Feb heating oil up 58 points as API stock gain small
--NY Feb gasoline down 54 points as API stock gain beats views
--API: US crude stocks down 589,000 barrels in latest week
--API: US distillate stocks up 33,000 barrels in latest week
--API: US gasoline stocks up 4.606 mln barrels in latest week
--API: US refineries operate at 91.6% in latest wk vs 93.0%
--APIs imply US gasoline demand 7.42 mln bpd vs. 8.62 mln
--APIs imply US distillate demand 4.27 mln bpd vs. 3.73 mln
By Karyn Peterson, Peter Rosenthal and John Troland, BridgeNews New York--Jan. 9--NYMEX crude and heating oil futures rose in overnight Access trade as American Petroleum Institute data showed crude stocks last week surprisingly fell 589,000 barrels, while distillate stocks rose by a marginal 33,000 barrels. NYMEX gasoline values dipped, as API data showed inventories gained a whopping 4.606 million barrels, far beyond the expected rise. API also reported that U.S. refinery utilization last week slipped by 1.4 basis points of capacity, exceeding expectations for a drop of 0.9-1.3 points.
At 1638 ET, NYMEX Feb WTI crude was up 13 cents at $27.77 a barrel, while Feb heating oil was up 38 points at 81.00c a gallon. Feb gasoline was down 54 points at 82.40c a gallon. The data, for the week ended Friday, Jan. 5. The U.S. Department of Energy will release its weekly inventory data on Thursday after 0900 ET. Crude inventories were expected to have risen 0.4 to 0.8 million barrels due to lower crude runs. But while crude runs did decline, the drop in imports was also significant, helping to erode total stockpiles.
Meanwhile, many brokers and analysts expected stocks of distillates, which include both heating oil and diesel fuel, to have fallen by 0.5 to 0.9 million barrels due to anticipated revisions to the previous week's data. But others predicted slightly higher stocks, which proved true. Total stocks rose as slightly higher demand--as implied by the data--and a dip in import levels were overshadowed by higher domestic output levels. Gasoline stocks were expected to rise 1.0 to 1.4 million barrels due to an anticipated drop in demand that would overshadow any rise in output. However, although output actually dipped, demand--as implied by the data--fell by more than anticipated and resulted in a build at least four times expectations.
CRUDE: Down 589,000 barrels
The small drop in crude an be mostly attributed to lower runs, which fell by 234,000 barrels per day to 15.169 million bpd, from the previous week's 15.403 million bpd, against the expectations of some market sources. "What surprised me a little bit was the run decrease," one broker noted. The drop in runs, however, was nearly offset by a 200,000-bpd decline in crude oil imports to 8.984 million bpd, from 9.184 million bpd the previous week, which met a number of analysts' predictions that imports would fall slightly below the 9.0-million-bpd level. The only drop in crude oil inventories, 2.9 million barrels, was on the Gulf Coast, as BP Amoco shut a 230,000-bpd crude unit Jan. 2 for maintenance. This overall drop in inventories caused the year-to-year deficit in total crude stocks to widen to 5.3 million barrels last week, from 4.1 million barrels in the previous week. In the Midwest, which includes the NYMEX delivery point for light, sweet crude oil futures at Cushing, Okla., crude stocks rose 407,000 barrels, which helped to narrow the year-to-year deficit there to 3.2 million barrels, from 5.1 million barrels the prior week. The largest build in crude stockpiles, 1.4 million barrels, was on the East Coast. Crude inventories also rose 163,000 barrels in the Rocky Mountain region and by 371,000 barrels on the West Coast.
GASOLINE: Up 4.6 million barrels
Stocks rose across the U.S., led by more-than 1.4 million-barrel increases in the Midwest and East Coast as a drop in demand offset lower output and import levels. Domestic gasoline output fell again to 7.76 million barrels per day
from 7.82 million bpd a week earlier and imports decreased to 312,000 bpd from 420,000 bpd. However, demand, as implied by the data, fell to 7.4 million bpd from 8.62 million a week earlier, possibly due to snowy conditions keeping motorists off the roads in the eastern third of the
U.S. "I still thought you'd see a decent draw the way people were buying it the last few days," a broker said. Despite the increase, the surplus to year-ago inventory levels actually decreased to 2.76 million barrels from 3.25 million a week ago. Reformulated gasoline inventories on the East Coast, the basis for the NYMEX futures contract declined 566,000 barrels and are now only 1.4 million barrels above year-ago levels.
DISTILLATES: Up 33,000 barrels
Overall distillate inventories increased as 1.9-million-barrel decline on the East Coast was offset by Midwest and West Coast builds. However, heating oil inventories declined on the East Coast, the biggest market, by 280$000 barrels and are now nearly 8.0 million barrels below year-ago levels. Demand for distillates rose to 4.27 million bpd from 3.73 million as industrial users with ability to switch fuels did so to escape rising natural gas costs. Distillate imports dipped to 422,000 bpd from 514,000 bpd, while output increased to 3.85 million bpd from 3.72 million. The overall supply deficit to year-ago levels also widened to 8.45 million barrels from 7.3 million a week earlier.
REFINERIES: Down 1.4 basis points
The drop in overall refinery rates can be attributed to lower runs in both the Midwest and U.S. Gulf regions, which overshadowed gains elsewhere. Runs fell the most, a sharp 3.9 points, in the U.S. Gulf, in line with the BP Amoco crude unit outage as well as downtime on several units at both Marathon Ashland Petroleum's 230,000-bpd Garyville, La., refinery and at Motiva's facility in Port Arthur. Midwest runs were down 1.2 points. East Coast runs rose 1.8 points, while runs in the Rocky Mountain region, an area that contains far fewer refineries that key industry centers such as Texas, rose 4.7 points. West Coast runs rose 1.6 points as Ultramar Diamond Shamrock continued to maximize rates on its crude unit in Avon, Calif., newly purchased from.
Black Blade: modestly bullish, yet OPEC meets on January 17th and has already declared that there will be a production cut of upwards to 2 million bbl/day. The real story as always is that of NG. The costs of energy will be the downfall of the economy. Every postwar recession was preceded by an increase in energy costs (energy crisis). We have an energy crisis now. Hard Landing? Definitely! But more like a crash. TPTB can't seem to contain this crisis. Even the Peoples Socialist Republik of Kalifornia Gov. Gray Davis sees his political future slipping away. Couldn't happen to a nicer guy.
I was wondering if all of you out there who are interested in gold.Would come on by my website and read about my quest to find the precious metal here in BC. I would love to hear what you all think.
Hope to hear from you soon
Daryl Friesen
Spindle Explorations
http://www.bc-alter.net/dfriesen
I agree. He is scrambling to position himself in order to pass blame onto others. The unfortunate thing about all of this is that this situation was brewing for decades and no one would take the "Bull by the Horns" so to speak. Now these Grasshoppers are trying to use threats and intimidation and will eventually steal from others. It won't work of course. They have closed down several power plants, and they don't have the means to operate them efficiently. They have oil and gas reserves, but those reserves are either off-limits or the environmental regulations and potential liabilities are too severe. It should be somewhat entertaining. I hold investments in some Utes, however, none are in Kalifornia, and they are also happen to be NG producers. Unfortunately, most of these Grasshoppers are lost on the concept of personal responsibility. That attitude is showing up now as they blame others for their misfortune. A good life lesson.
Life Lesson:
I don't know why I bring this up other than to show the comical feel-good liberal elitists (Grasshoppers)at their best:
About a year or two ago, there were a few animal protectionists who had "saved" a baby seal and brought it back to good health. They enlisted the "help" of several dozen munchkins from the local elementary school to share the experience of nature. Sure enough, the baby seal's health improved and was soon ready to be released back into the ocean. That day finally arrived and the baby seal was boxed up and ready to go. The munchkins were gathered up and sent to the beach with the baby seal in order to share in the experience. There was a lot of celebration and the news media was there to film the whole event for "news at 6." There was hot dogs, soda, and balloons for all. Eventually with great fanfare, the box with the baby seal was brought forth. The munchkins gathered around and the seals saviors opened the door. The baby seal flopped down to the beach and into the ocean as the little munchkins cheered and squealed with delight. Suddenly out of nowhere, to the horror of all, an Orca popped up and snatched the baby seal in its teeth and proceeded to crunch on the baby seal. Then with acrobatic skill the Orca flipped the now dead seal pup into the air and caught it again in its jaws. The little munchkins screamed in terror as the surf turned red and raw nature unfolded before their eyes. "News at 6" was interesting to say the least. Of course, the horrified munchkins were given grief counseling.
LOS ANGELES, Jan 9 (Reuters) - California power officials declared a heightened alert as demand peaked on Tuesday evening, prompting outages for some large commercial customers that have agreed to shut down electricity consumption in exchange for reduced rates. The Stage 2 emergency alert came as power reserves dropped to within 5 percent of the load on the state's electric grid, which is managed by the California Independent System Operator (ISO). The emergency was declared at 2015 EST and should last until 0100 EST or 10 p.m. Pacific Time. Available power reserves have been tight all day with some California plants shut down and only limited power available from the Northwest, the agency said. Then the ISO said another power supply in Southern California went offline, prompting the alert. Southern California Edison spokesman Steven Conroy said the ISO did not disclose what power plants had taken capacity off line, but said as much as 10,000 megawatts of productive capacity were already offline for maintenance. The agency directed Southern California Edison to reduce its electrical load by more than 1,400 megawatts -- enough power to serve approximately 1.5 million homes. ISO officials and Southern California Edison, a unit of Edison International EIX.N, appealed to consumers and businesses to dim lights and shut down equipment and appliances if possible. California has never experienced a full Stage 3 alert, which would be triggered if reserves drop to less than one and a half percent, and could set off rolling blackouts for homes and businesses across the state. The declaration came as California Gov. Gray Davis took a plan to avert power blackouts and save the state's major utilities from bankruptcy to a top-level meeting in Washington on Tuesday. No news has emerged from the meeting.
I thought I had read everything in the last few days, and I did see a post re BIS volumes, so I will have another look.
And yes, I agree that interest rate arbitrage drives a good number of FX trades, however I am not yet convinced that there is sufficient real interest rate convergence worldwide, to effect the trade to a significant degree, altho it is a possibility. Certainly I do not think that this, in and of itself, is sufficient to account for the drop in volume recorded. I will have to sit down for a beer with a couple of interbank traders I know, and get their feelings.
Time; I must either be getting old, or having a lot of fun, because I can't seem to find 24 hours in a day lately. I have 12 to 14 hours of one finger typing ahead of me.
Psst - Psst - Want to Buy Some Palladium - Cheap @ NOT
Palladium may peak at $1,300Our Russkie Friends sure make splendid capitalist, yes.
Do they understand - supply & demand concepts?
DJ MARKET TALK: Tocom Palladium subdued, Outlook Eyed
0800 GMT (Dow Jones) Tocom palladium subdued overnight, ends at 1,035.50/oz. Outlook turns mixed. Some analysts say palladium should top $1,100, may even peak around $1,300. One says mkt should eye downside risks as Russian shipments to arrive this month. (SPM)
-0- 10/01/01 08-00G (END) Dow Jones Newswires 10-01-01
The breaking strain is when the rope snaps.
The safe working load is the breaking strain divided by the safety factor .
The safety factor is a proportion of the breaking strain .
Oh the one liner competition . "How much endless rope can be put down an endless shaft before it snaps !" ? . Ans ... Until the weight of the rope itself breaks ; which is about as daft/smart as "How strong is a piece of chain " Ans as strong as its weakest link. I saw it in Palladium and freaked out sold at double . A loss in some ways is it ? hehe. But I didnt know Black Blade so well then. (Smile) dispite my own hunches. Thanks for the confirmative tips brother, its Mayfair :).
I walk in the door my wife kisses me home , the cat meows knowing I will open the fridge and feed it 5 star treat..
(routine) I hear he news USA , POWER, CALIFORNIA , hit the net and roll through the scroll-bar and all I have got to say is ( Speed listening ) I bet that this new Govt by the private Fed will say is the books are worse than one thought so one cant do what was promised . i.e Lower Taxes.
Zenidea ... Immmm been on this earth to long. Bottle shop here I come !.. One of these days I am going to spill some beans !... and oneday that day I will be sober !
To all those who participated in this debate - my contribution:-
The only meaning of anything that is meaningful is that which applies to those within a given society at a given time. If we are looking for origins of words or meanings, that is different. Take a simple word like �gay� there is a completely different meaning today in our society than a decade or two ago.
There are two interpretations of words. There is the accepted dictionary definition OF THAT PARTICULAR society, and the word's CONNOTATION by use within that society. As any writer, or orator ( or salesman) will know, a word's connotation cannot be ignored although it may be at variance with that of the dictionary.
Words, to any individual are only as good as the �mind pictures� they create. Words are a human development for communication. Communication can only be effective if there is clear understanding between parties.
We cannot just say what is the meaning of law ( or most any word) without clearly defining its context or application. That is if we are striving to determine a true meaning.
Here are a few words which a �word finder� may throw up as having a relative meaning to the word LAW:- rule, governing principle, regulation, mandate, commandment, established dictate, decree, legal form, enactment, precept, edict, standing order, statute, ordinance, canon, bill then we have the �laws� of physics�����.and so on. Most of these words, while related, have slightly different meanings and connotations in use.
Most of us have encountered these �smart� professors who try to trip up the unwary student. Teachers have one main function and that is as a catalyst to inspire us to question and seek out the truth. They can inspire us even when they show us just what idiots some of them are.
As George Bernard Shaw said � "He who can does, he who can't teaches". In that, there is some element of truth.
There is also, within our society, a well known clich� for what LAW is : " The law, as it is applied, sir, is an ass" (My apologies to that species of our four legged friends)
Sierra Madre : ...willing to "bell the US cat" : says it all. This must be the one and only answer to the library of questions, that are hypnotising me. Together with the clear points that Pandagold (45342) is making...I have plenty of reasons to survive and understand. Thanks Panda !
Auspec (45346) : I don't have the answers. My dwarf-logic is not compatible with the Gold-Giants intentions. I just try to understand this crazy world. I'll stay, pupil until the last breath. I know nothing and can't provide evidence for conclusions made out of what I am trying to see.
I guess we are all stucked with that vital question, if and when "the drama" will unfold. The lower POG, the less likely we are sure it will. Perhaps, we are the only emotionnals left on Gold. And that might be exactely the purpose of the dirigents.
One can argue in an honerable and orderly fashion on any side of the fence ( infinite regresses ) A tough one indeed . Two inate born truth's that make perfect sence but absolutely contradict each other. Trail Guide , am I reading between the lines . One seems sure one is being pointed :)
between the lines . Now Socrates had something to say about
big/small slow/fast etc etc didnt he Sir?.
AIM-listed Eurasia Mining is understood to be in talks with mining giant Barrick to accelerate and expand Eurasia's mining operation in Russia for palladium, which has just breached the record $1,000 an ounce barrier.
For the Rest of the most interesting news story see link above
Those that know not and know they know not; Teach.
Those that know and know not they know ; Show.
Those that know and know they know ; Follow.
Those that know and think they know ; Shun,
Black Blade, All,
Don't be at all surprised to see quite a few of these "brand new technology" products coming to the fore in the new Months/Years of the 3rd Millenium.
The "tech" revolution has petered out somewhat lately and the good ol' US of A has it's back to the wall - what better way to rekindle the flame and extend the timeline of the World reserve currency than to spoonfeed a couple of "top-secret" innovations into the marketplace!
P'raps one or two MAY even benefit Gold!
Wouldn't mind betting PGM run-up is related to Fuel-cells.
Thats it !!!!. its not who turned the lights off but rather whom turned the dark on . Now the Patent office has its finger on the trigger .... and AU/PT may well be the trigger to eternal life :) as it stands in this amazing world of drugs. Gold get yea some :). Even Oro if he put incredible mind to biology instead of maths or shared abit that way as this beautiful man does would by the nature of reason confess some self evident truth :)
One of two things will happen. 1) The Russians will burn Barrick badly as they have just about every mining company that has tried to do business there and they will get ripped off royally. Not a bad thing considering that it is Barrick - the hedge fund miner; or 2) Barrick will short sell the hell out of the PGM metals and yet destroy another industry.
I think that number 1 is more likely since Barrick will be on their turf.
What is Roman Law?
Roman Law was the law that was in effect throughout the age of antiquity in the City of Rome and later in the Roman Empire. When Roman rule over Europe came to an end, Roman Law was largely--though not completely--forgotten.
In Medieval times (from about the 11th century onward) there was a renewed interest in the law of the Romans. Initially, Roman Law was only studied by scholars and taught at the universities, Bologna being the first place where Roman Law was taught. Soon Roman Law came to be applied in legal practice--especially in the area of civil law. This process of (re-) adoption (reception) of Roman Law occurred at varied times and to various extents across all of Europe (England being the most important exception). Thus from about the 16th century onward, Roman Law was in force throughout most of Europe. However, in the process of adoption/reception many Roman rules were amalgamated with, or amended to suit, the legal norms of the various European nations. Thus, Roman rules, applied in Europe at this period, were by no means identical with Roman Law from antiquity. Nonetheless, because the law that had evolved was common to most European countries, it was called the Ius Commune (common law).
In the form of the Ius Commune, Roman Law was in force in many jurisdictions until national codes superseded these rules in the 18th and 19th centuries. In many regions of the German Reich, Roman Law remained the primary source of legal rules until the introduction of the German Civil Code in 1900. Even today a special branch of the Ius Commune, known as Roman-Dutch Law, is the basis of the legal system in the Republic of South Africa.
To what extent did Roman Law influence the English legal system?
England did not adopt Roman Law as the other countries in Europe had. In England, ancient Roman texts were never considered as rules having the force of law. Nonetheless, Roman Law was taught at the Universities of Oxford and Cambridge, just as it was taught at Bologna. Scholars, who had studied Roman Law on the Continent (the so-called Civilians), did have considerable influence on the development of certain areas of law. Some substantive rules, and more importantly concepts and ways of reasoning, developed by continental legal scientists, based on the Roman legal tradition, influenced the English legal system.
The Bible and Western Law
Harold Berman, perhaps the greatest contemporary authority on legal history, notes that "the Laws of King Alfred . . . start with the Ten Commandments and a restatement of the laws of Moses." [12] Alfred's laws, written in the tenth century, became the foundation of the English common law, which our Founders adopted virtually whole. In the eleventh century Pope Gregory VII, whose work "gave birth . . . to modern Western legal systems," [13] "never doubted . . . that the power of the secular ruler was established by God." [14] One hundred years later, the monk and renowned legal scholar Gratian wrote that "the validity of an enacted law depended on its conformity to the body of human law as a whole, which in turn was to conform to both natural law and divine law." [15]
This reverence for the Scriptures exhibited by legal authorities continued through the eighteenth century in the works of William Blackstone, as evidenced in his Commentaries on the Laws of England: "Upon these two foundations, the law of nature and the law of revelation, depend all human laws; that is to say, no human laws should be suffered to contradict these." [16] Blackstone's influence upon the American legal system was profound: an exhaustive study of citations from 1760-1805 found that Blackstone, representing 7.9% of all references to thinkers, ranked second only to Montesquieu. The Bible, incidentally, was the most cited authority�34% of all citations in the colonial period, the greatest number of those coming from a book focusing on legal issues: Deuteronomy. [17]
This clear historical link between our legal system and the Bible led Russell Kirk to conclude that "American political theory and institutions, and the American moral order, cannot be well understood, or maintained, or renewed, without repairing to the Law and the Prophets." [18] Even Supreme Court Justice David Brewer noted that "the citizen who does not . . . share in the belief of those who do, ought ever to bear in mind the noble part Christianity has taken in the history of the republic, the great share it has had in her wonderful development and its contributions to her present glory . . . ." [19] The almost universally held view in America, until recently, was that morality represented the connection between the secular and religious realms. Tocqueville asserted that "the safeguard of morality is religion, and morality is the best security of law and the surest pledge of freedom." [20] He also noted, "The Americans show, by their practice, that they feel the high necessity of imparting morality to democratic communities by means of religion. What they think of themselves in this respect is a truth of which every democratic nation ought to be thoroughly persuaded." [21] Another colonial historian asked rhetorically, "Were [the Puritans] not right in teaching and practicing that the principles of religion and morality should govern men in the discharge of their duties as citizens, as well as otherwise?" [22]
Where was the Magna Carta in all this? The snippet I retained from those years of daydreaming in boring classrooms, was that it was the foundation of British and American law.
Cris, thanks for the discription, I suspected as much from the article. One key was that bit about "Regulations will be passed against it."
Right after WW-II it was thought that soon everyone would be flyng around in their own airplane. There was a neat little 2-seater with twin rudders called the Ercoupe and and Piper came out with a tiny bubble canopy single called the "Skycycle" priced at $995. (Circa 1947) I've always thought the reason it didn't happen is that the traffic would have resulted in countless fatal mid-air collisions.
Now computer navigation with distance-from-others detection should make this feasable. But the danger aspect is what will be used to suppress it.
The Auto and petroleum industries are not going to be happy about this.
Platinum up +$10.00, Palladium up another $15.00, Gold down $1.20, and silver down 2 cents. Market futures are all down. Currencies are mixed though USD index is higher. Petroleum is lower. Yep, situation is back to normal.
http://www.gold-eagle.com/gold_digest_01/taylor011101.htmlRavi Batra says that we're in crash mode. I can't argue that one. The article lays it out as has been discussed here on this forum. Grab your crash helmets! Could be only days away.
Some of you may, or may not, have heard of Sir Richard Branson ( originally of Virgin Records and now Virgin Airline). Branson is the best loved of today's young British entrepreneur with the vast majority of Brits.
Britain also has a very highly successful National Lottery. The job of running of the lottery, was contested by Branson when it was started some years ago. He, then, offered to take no profits and return all profit to �good causes�.
However, he lost out to a very dubious consortium, run by �front men� for what turned out to be a very dubious entity whose tentacles reached into the US and � yes, you know where. Profits were creamed off to feed fat cat executives and the lord knows what. A number of evils came to light during the initial period of licence.
That period is up this year and applications were made again. Again Sir Richard applied with the same deal that all profits would go to good causes. At first it appeared he was going to be successful and he was given the green light.
At that time, I said something will happen to stop him getting it, though it seemed unlikely at the time.
Why would I think this? BECAUSE HE IS NOT EVEN REMOTELY CONNECTED TO THE �CABAL.� He has no connections on the 'inside'.
While I am sure he has a few human failings (don't we all) he is, for a businessman, a pretty straight guy that came up from his own abilities � no secret hand shakes or other affiliations that take care of �their own�. He is a man of his word, and the people would have been assured of a fair lottery.
When the knock back came, he was obviously incensed. He first said he would fight the decision to give the lottery back to a consortium that had shown themselves to be a bunch of crooks with dubious connections. He also talked of running his own lottery.
Today he threw in the towel. If you listened to his words, he said as much as he dared, about who is behind all this. He said that he would not be applying again, and that neither would anyone else while the present system exists.
Why am I telling you all this? Did you read my posting about King Canute who attempted to order the sea to obey his command � not because he was an idiot, but because he wanted to show his subjects that there are forces in this world � not all natural ones, that are more powerful than a king.
As I have said before. Don't doubt the abilities of those who are controlling the agenda. Know what they are about. Don't fight them. Join them. NO I am not being chicken � just facing reality. There is a saying. How does it go? Lord help me to change that which I����������" and it ends with "�����.but the wisdom to know the difference.
Thank you for your e-mails on the good work which has been undertaken by
GATA over the last few years. As you know, our company has been supportive
of GATA and similar interventions that have the best interests of the gold
industry at heart.
We have assisted in various methods of support in the GATA initiatives.
Harmony, as one of the four unhedged major producers left in the gold mining
industry, has a lot to gain from an increased gold price. Any initiative
which can assist in correcting the imbalance in the gold price needs all the
support we can give it.
Representatives of the company will be meeting with representatives from
GATA during the Cape Town Indaba to discuss their initiatives further.
I do hope the above assists in indicating our support of this important
initiative from GATA.
Please contact me should you have any additional queries.
Regards
Ferdi Dippenaar
Marketing Director
Harmony Gold Mine
In hindsight, I agree. Ever since the Bank of Englands announcement to sell gold, I've been in a bunker type mentality. I was tempted to short the dot.com's last summer, but it would have meant selling physical in order to speculate. What intrigued me about the post was the writers myopic tunnel vision.
http://straitstimes.asia1.com.sg/money/story/0,1870,15466,00.html?gidsek (1/9/2001; 23:38:12MT - usagold.com msg#: 45369)
"Justamerebear FX volume:
I don't know if you got an answer to your question about FX volume. In case not, I think I or someone posted here about two days ago an article that explained this in terms of converging interest rate worldwide."
--------------------------
The following may help you...from last Friday:
--------------------------
Randy (@ The Tower) (01/05/01; 16:20:15MT - usagold.com msg#: 45131)
HEADLINE: Daily forex trading shrinks by a quarter
http://straitstimes.asia1.com.sg/money/story/0,1870,15466,00.html?
Globally, the volume is down a quarter, while in Asian trading centers specifically, the volume is down nearly two-thirds.
+
A good excerpt from the article:
+
"Lower currency flows can also be attributed to 'an unprecedented convergence of global interest rates' in the past five years, wrote Mr Leven. The narrowing differential on yields dampened demand for 'carry trades', where investors borrow money at a low interest rate and deposit it in countries with higher returns, he said.
+
Lehman expects trading volume to pick up again this year, as the bank forecasts the US dollar will decline against the euro and yen."
@PandagoldNo way! These people's behavior goes against everything I believe in. I am absolutely not prepared to go along. Yes! I read several things about Richard Branson. For what I know he is far to be out of business. He is still pretty well off.
As for the people you are referring to, they have better to watch their back. Nothing is eternal. While they would not have any scruples to nuke anybody bold enough to threaten their interests, they should not forget that they can be evaporated as well. If it ever happens it will be the end of their reign.
If you had read my posting, properly, you will see I anticipated such a comment, I quote:
"........While I am sure he has a few human failings (don't we all) he is, for a businessman, a pretty straight......"
The only 'perfect' man ( so we are informed) was crucified 2000 years ago.
Incidentally, because of his growing popularity with the British public, (the fact that he was the only person cheered when he arrived at Diana's funeral service did not go unnoticed) and his bid for the lottery - the cabal backed media threw out as much dirt as they could find to try and tarnish his name. But we are quite used to that by now
@PandagoldWhat I wrote did not mean I had no respect for this fellow. To the contrary, I start to think this is exactly the kind of guy we need if we want to get rid of this oligarchy.
Yes I have great faith in their CEO. I like their name, I like their CEO, I like their product this company will be one of the great leaders of the industry. Instead of hedging, it is building - THAT is FAITH and should be rewarded.
Thank you, the link is fascinating. I shall study it and report back to you. We should All Know WHO the players in this game are, there should be no "secrets".
Randy 45399
Excellent, and that makes a bit more sense from a non conspiritorial, or natural process perspective, which I try to look for first, altho I can't see that magnitude. I will follow up. Many thanks.
Zenedea 45387
I think you may have left out a couple of NOT's (lines 2&4) eg He who knows NOT and thinks that he knows, Shun. Also has been quoted as; He who knows not, and knows not that he knows not, Shun, for he is a fool.
Reter Asher 45392
I think if you read for meaning, you will find that the Magna Carta was more about the removal of the divine right of kings. (and all that implies) For example, the right of the king to first night privilages with any new bride in the kingdom.
From an article by Phillip Coogan in The Financial Times London. I like his suggestion in the fianl paragraph - it makes sense - or does it? Can you tell one wily fox from another? I mean the Uk has an election coming up in three months. It has been ensured that Blair will get in again by making sure their is no alternative choice. Haigue? You've
got to be kidding. This is why true democracy does not exist
.
"........The main reason for the market's indifference is that politicians don't seem to matter any more. It was only the uncertainty of the result that prompted much interest in the US election. In many countries, politics appears to have reached the stage of Japan or Italy - the faces may change from time to time but the policies remain much the same.
Markets now care more about the identity of central bankers than of prime ministers - the resignation of Alan Greenspan would cause much more of a crisis than the departure of George W Bush........................
............This faith in central bankers may turn out to be misplaced. Mr Greenspan's judgment in ruling out a quarter-point rate cut in December, and then slashing rates by half a point in early January, is already being questioned..................
.........How about giving electors the chance to vote for the chairman of the next Federal Reserve, governor of the Bank of England or head of the European Central Bank? Now there's an election the markets would definitely care about......"
http://www.usagold.com/FederalReserve.htmlThe article, by Dr. Edward Flaherty, University of Charleston, imho, is pretty shallow on the subject "Who Owns and Controls the Federal Reserve?".
The article basically attacks two authors (Eustace Mullins (1983) and Gary Kah (1991) assumptions that there is some sort of global "conspiracy" going on and how these two authors are wrong in their assumption.
It really does little to attack the original question of the essay, "Who Owns and Controls the Federal Reserve?".
I would have to give the good doctor a C-, he had good punctuation and grammer, not much content.
http://biz.yahoo.com/rf/010109/n09420687_2.htmlThis Reuters article provides a look at the foreign investors' ability/willingness to react to changes and to "drift with the favorable current of the day".
It recounts how foreign investors in U.S. paper are decreasing their holdings of Treasuries in favor of increased buying of the debt paper of U.S. federal agencies--the shift being a result of the lower yield on Treasuries stemming from price premiums on expectations of additional Fed rate cuts and the slowdown in Treasury issuance.
In a quote in the article, Phil Guth, senior director of global debt and equity at Freddie Mac sizes up the situation like this, saying that overseas investors "have to find a product that has enough liquidity but at same time offers them enough yield. Treasuries certainly offer liquidity, but with the recent rally, and scarcity, they don't offer much yield." He elaborated that foreign buyers are drawn toward products like agency debt "where the liquidity admittedly is not as good as what you get in Treasuries, but it's very good and you have a lot of yield to make up for what you don't have in liquidity."
Reuters then recounts data from the Fed's custodial accounts on behalf of foreign central banks showing the gradual shift in holdings of U.S. debt. The amount of Treasuries have fallen in these accounts from $612 billion last February to $589 billion at the end of the year, while holdings of agency debt has increased from $83 billion to $103 billion during this same period.
Support behind this trend was articulated by Robert D'Eustachio, senior vice president of the agency desk at Fuji Securities Inc. in New York: "More and more foreign accounts are aware, comfortable and active in trading agencies because of the easy price discovery ... and liquidity. If they need to sell, they know there's a bid for it."
Also adding support for acceptance of the agency debt at this time is the failure of the past legislation which was pending to limit the housing financiers and lead to a severing of government ties as a result of preemptive maneuvers by Fannie Mae and Freddie Mac toward transparency and risk management. Analysts are saying based on this recent experience and improved political climate for Fannie and Freddie that lawmakers will only be more likely to pass future legislation which strengthens, not weakens, the financial soundness of these various Government Sponsored Enterprises (GSEs), and similarly, the GSEs will strive in such a manner so as not to lose their government ties.
The moral to the story is that here we see investment sentiment shift from one old favorite paper chase to another in pursuit of a combinatiion of adequate liquidity and higher yields, all occuring within the context of a dollar that is assumed will maintain its international poise.
As we know, when confidence shifts and devaluation is at hand, the subsequent losses in purchasing power can far outstrip the value of the yield that was originally being sought with investments in debt paper such as these. At such a point of currency devaluation, it will matter not if the holdings be Treasury, Agency, or commercial paper. They will be losers and subject to the liquidity risk of a sellers-only market...lest the Fed step in as "buyer of last resort" to monetize the debt, turning old contract promises into new currency paper.
Gold is the ultimate protection for retaining your savings against the whirlwind of such a day when your national currency is clearly seen as only grease for the wheels of commerce yet poor substitute for real wealth and tangible assets. Just ask anyone familiar with "third world" currency.
From standpoint of size and importance, China can not be expected to "come into the fold" under the system's existing biases.
http://english.peopledaily.com.cn/200101/10/eng20010110_60117.htmlHence, the international movement toward a more level "playing field". Those with U.S. interests must not bank on a continuation of the deficit without tears scenario that has been in effect for so long in this great land of ours.
From the article:
-----
"The period immediately ahead is crucial to China's economic adjustment and development, as well as the country's further opening-up to the outside world, after the economy witnessed a significant turning point late last year, Chinese Finance Minister Xiang Huaicheng said in Bangkok Wednesday. "The economy is estimated to grow 8 percent in 2000, as the three engines of investment, consumption and export growth have accelerated and the aggregate demand surged up. ... China has successfully held the momentum of a slowdown in economic growth [from the recent Asian currency crisis], and maintained relatively high growth of 7.8 percent and 7.1 percent in 1998 and 1999, respectively." [He also said China's GDP is expected to surpass one trillion US dollars (at the current exchange rate) for the first time.]
+
During the short-term future within five years ahead, the minister said China will treat development as the main theme, restructuring as the central task, while taking reform, opening-up, and scientific progress as the engines, and shouldering the improvement of people's living standard as the fundamental task.
+
The goal for the above tasks is to achieve a rapid and efficient economic growth through economic restructuring, while laying firm groundwork for doubling China's GDP of 2000 in the year of 2010, the mid-term objective, according to him.
+
"On the international side, with globalization gearing up and worldwide structure adjustment intensifying rapidly, international competition is formidable, " he said.
http://www.usagold.com/DailyQuotes.htmlI have posted a report at the Daily Market Report page. It contains an interesting report from Dow Jones news service that might generate some interest here.
Re: Who Owns the Federal Reserve @Orville Goldenbacher
Not clear that you need the following, but you can never over-expose the truth that the FED is privately owned so here is a repost so exposing said FED:
Repost from Oct. 18, 1999 & January 25, 2000:
You've probably been assuming your whole life, when you thought
of it, that the "Federal Reserve" was a government agency of some
sort. As hard as this may be for you to believe, despite the
misdirective use of the word "Federal" in it's name, it is not.
It is, in fact, an agglomeration of privately owned banks which
work hand in glove with the Federal Government. -L.Reichard
White, "MONEY," (Brownsville, Penna: WhiteINK 1997)
.....The bankers have also been able to deceive the American
people into believing that a Federal Reserve Bank is a
government institution, when in fact, each one is privately
owned. If you want to see for yourself, look in the
government pages of a phone book in a large city such as Los
Angeles or San Francisco. [A city where there is a Federal
Reserve branch bank. -LRW] You will not find any Federal
Reserve Bank listed in the government pages. But you will
find a Federal Reserve Bank listed in the white pages, just
like any other privately owned corporate entity. The Ninth
Circuit Court of Appeals also confirms the fact of private
ownership.
.....Each Federal Reserve Bank is a separate
corporation owned by commercial banks in its region.
-_Lewis v. United States_, 680 F.2d 1239, 1241 (1982).
-Otto Skinner, _The Biggest 'Tax Loophole' of All_,
(San Pedro, CA: Otto U. Skinner 1997) p. 163
Here is an idea of who owns the Federal Reserve from _The
Economic Rape of America_ by Fredrick Mann, p21:
*WHO OWNS THE FEDERAL RESERVE?*
There has been much speculation about who owns the Federal
Reserve Corporation. It has been one of the best kept
secrets of the century, because the Federal Reserve Act of
1913 provided that the names of the owner banks be kept
secret. However, R. E. McMaster publisher of the newsletter
_The Reaper_, asked his Swiss banking contacts which banks
hold the controlling stock in the Federal Reserve
Corporation. The answer:
1. Rothschild Banks of London and Berlin
2. Lazard Brothers Bank of Paris
3. Israel Moses Sieff Banks of Italy
4. Warburg Bank of Hamburg and Amsterdam
5. Lehman Brothers Bank of New York
6. Kuhn Loeb Bank of New York
7. Chase Manhattan Bank of New York
8. Goldman Sachs Bank of New York
In _The Secrets Of The Federal Reserve_, Eustace Mullins
indicates that, because the Federal Reserve Bank of New York
sets interest rates and controls the daily supply and price
of currency throughout the U.S., the owners of that bank are
the real directors of the entire system. Mullins states:
"The shareholders of these banks which own the stock of
the Federal Reserve Bank of New York are the people who
have controlled our political and economic destinies
since 1914. They are the Rothschilds, Lazard Freres
(Eugene Mayer), Israel Sieff, Kuhn Loeb Company,
Warburg Company, Lehman Brothers, Goldman Sachs. the
Rockefeller family, and the J.P. Morgan interests."
If the government wanted to take gold out of circulation like they did in the thirtys would they not depress the pog before taking action? Could the government have this in mind for the near future? Any history majors out there? Gold bug
History majors and other mushrooms @Gold bug msg#: 45419
"If the government wanted to take gold out of circulation like they did in the thirtys would they not
depress the pog before taking action? Could the government have this in mind for the near future?
Any history majors out there? -Gold bug msg#: 45419
Don't bother to ask history majors - - - or economists (except Austrian School economists). They've all been treated like the proverbial mushroom. (Kept in the dark and fed BS.)
http://biz.yahoo.com/rf/010110/n10469354.htmlFollowing the unexpectedly large and sudden rate cut by the Fed, officials for central bank are now trying to do damage control on investor sentiment. Today, Boston Fed Bank President Cathy Minehan said "The sky is not falling, but just in case, the Fed is looking up. I continue to believe moderate growth for the coming year as a whole is the most likely outcome. But in recent weeks, those risks have become more evident."
Bottom line: it is important for productive people and savers to know that it is simply "the nature of the beast" for a fiat currency (such as the dollar) and its supportive banking system to always inflate (supply) within its domestic marketplace. The primary rub to gold advocates comes generally at the peak of a long economic expansion in which they see that currency inflation has not been manifested in higher gold prices. Assess the reason.
It can be said that during the expanding economic cycle there are ample outlets for the distribution of the inflated currency supply as confidence in various investment prospects remains high and "safe havens" are viewed out of favor. However, as the business cycle shows signs of turning down, conventional wisdom holds the view (improperly) that "cash is king" as entities shall now vie for a tighter supply of currency with which to service their debts exuberantly acquired during the expansion. This is the point where unsavvy gold owners tend to throw in the towel on gold since it did not "perform" to their expectations during the expansion of both the economy and the currency. Such gold selling at this time by such people provides grand gold-buying opportunities for those who understand the big picture and the nature of fiat currency.
A central bank as lender of last resort, together with the political will of the government, in this day and age will not allow for the pains of a contracting currency supply to be felt domestically during the downturn of the economic cycle. Through the various tools of the trade they ensure at a minimum that the currency supply available within the domestic market is maintained for the health of the banking system upon the viability of debt-service. With few attractive investment opportunities as outlets for this currency supply during the downside of the economic cycle, these official efforts are sometimes described as "pushing on a string" and the once good repute of the currency now begins to suffer as it could not during the economic expansion.
It is at such a time as this that "productive people and savers" (whether international, local, official or individual) look most earnestly to flee from exposure to this weakening currency unit. Would you agree that there are many to be found (globally) with a vested interest to flee the dollar in the event of any economic downturn having claws? Where do they turn? Gold is the one financial asset that is internationally recognized with ample liquidity and the ability to absorb soaring exchange rates without tanking a domestic economy through a knock-on effect with trade balances...because no nation uses it directly as its domestic currency, you see.
From here, futures prices may drift higher, they may drift lower, but we have beaten into the ground the distinction between owning the metal and not owning the metal when unpredictable monetary events are precipitated. Twenty-one year low prices strike me as an opportunistic time to start or add to your gold holdings. No one can buy at the bottom but out of blind luck, and "events" may make accumulation on the upswing a real nail-biter complete with soaring premiums.
Sir Gold bug - great handle, definitely says it all. You've broached a subject which hits the nerve of just about all who mistrust big brother and his nefarious ways - that of possible confiscation for whatever drummed up reason.
A diverse set of possibilities exist, which could have severe consequences for anyone looking to PM's as a safe harbour. Ask anyone from the 30's who was looking over their shoulder when they went to the Bank to remove their personal possessions from the safe deposit box, as the banks were collapsing. As I recall most bank failures did not occur until well after the 29' crash. Most were into 31-32 timeframe
Perhaps we can rouse the debate over whether it will happen and for what reason? What are the safe(r) denominations, ie. pre '33 vs. Eagles, Rands, Leafs, etc.? Au vs. Ag vs. PGM's?
USA storage (for those inhabitants) vs. Outcountry? Personal storage in safe deposit box in USDA prime choice Fed insured institute vs. hole in the ground on {Mars} - easy choice, no?
And would confiscation ala '33 be a pretty good contra indicator that the paper gold game is over, as well as US fiat, along with probably every other currency in the whole mother ship.Might confiscation in and of itself, skyrocket the perceived value of gold, as the equities confidence game would be kaputsky along with the above mentioned currency *wealth*.
Many historical, actuarial (persons and gold - ie. do we survive without it), philisophical, and moral questions to be answered with this look at history and possible confiscation again.
My answers are partially hidden in the above questions - let's see if this is a worthwhile topic. I'll chime in later.
Gold Confiscation in the United States: Michael and George have assembled this comprehensive document
http://www.usagold.com/INFOPACKET.html#anchor1692132To get it at no charge, all you have to do is call them with your request. And seeing from the clock that they have returned to their homes for the night, I suggest you wait until tomorrow to call them up. Be sure to say that Randy sends his regards.
Hey Trail Guide....will you at least take a silver plated pine cone in your pocket?
I am really pleased for the real flow of emotion out there on the trail.....
You and I are both intellectuals.....but spirit evolves at the margin where thoughts are loose and our ideas become energies.
I am willling to make a little bet with you.
One of us buys a box of 500 one ounce 2001 Silver Eagles and the other buys the same value of one ounce Gold Eagles. One the day when Gold hits $5000 per ounce, we meet eachother at a flea market and both of us try to liquidate our wares. In a poor man's market, I will at least have more customers....and the fun is in the selling.
There are a lot of other more intellectual reasons why silver is much closer to gold than iron, and why its owners can benefit along with gold....
Didn't you notice that those little signs along the gold trail have little tarnished silver inscriptions on them???
A little of the right polish and I'll have them back in white glimmering condition for you...you see, that is the property of silver which doomed it to the metal heap....it tends to tarnish just ever so slightly...allowing it to be used as a chemical....and at the same time...on a chemical basis it has this beautiful reflection of gold in it...perhaps a kid brother...but a beloved brother nontheless.
May all rain clouds on your Gold Trail have a Silver Lining.
Awesome email from Harmony. Who do you think THEY think are the 3 other unhedged majors. My guess would be GOLD, FN.TO and ?.
Your guess?
Of all the miners that I have emailed only Pan American has replied, support GATA but since they are a silver producer they feel it not necessary to contribute. (along those lines).
auspec,
Where's Mr. Christian? Did you notice his censored post over at G-E the other day? I'd like to know of this $526 POG.
RE: Trail GuideSee your point but I don't believe FOA has the "flea market set" in mind. I believe he is talking about picking up all the marbles and calling it a day IMHO. Good to see you posting.
Building on the earlier post...assessing "the way it is"
http://biz.yahoo.com/rf/010110/t87369.htmlIn an interview published today, IMF managing director Horst Koehler said the U.S. soft landing may not be "as soft as you may like. I will be bumpier." Adding, "But it is a substantial slowdown. The pace of deceleration of economic activity in the U.S. has surprised many people."
Reuters then states in the article, "The Federal Reserve, the U.S. central bank, cut its benchmark money market rate last week by half a percentage point because of the deteriorating growth outlook, and the Business Times quoted Koehler as saying he would back further cuts 'if early indicators show there is further need to strengthen confidence'."
The only confidence a further rate cut will foster is that the banking system will not collapse. The currency, on the other hand, would be in a very bad way...
Take a long hard look at gold, my friends. It is international and blessedly non-national all at the same time.
I own Harmony and Goldfields Ltd. because they are both un-hedged. Im not sure who the others are or who Harmony thinks the 3 other un-hedged majors are, but .....I do think all will know as soon as GATA gets to South Africa. BIG BIG SMILE!!
I visit many places during the course of each day, the gold-eagle forum among these. Top-notch place. The postings are listed in time periods and viewed from the bottom up as we do here but at the end of each time period, at the top of the page, the reader is greeted by a happy smiling face and a friendly waving arm. At the top of every page, every blessed one. Yup, it's Bubba himself. I don't see him anywhere around here. Thank you, Michael, thank you!
Soon, I think, soon the Dow and Duck descend again.
Be careful
Rich
Alan Green-$pandexThank you for your response to the "Black Gold" question. The first part of the proposition is whether or not a vast amount of "unofficial" or "unknown" gold is in existence. There is a great deal of logic and research that strongly suggests the existence of same to a large but fully unknown degree. I no longer doubt it.
The second part of the proposition is what is the significance of this large supply? I keep saying that at $270 gold it has practically NO impact on the market for a couple reasons. As you state these folks are anything but "stupid", and they don't need to be educated on the value of Au. They will give it up for the right price/favor/blackmail/whatever, but all the signs say that this is NOT the source of gold suppression. The mountain of paper, derivatives, is the red flag. Someone is probably/ possibly backing this mountain of paper with the real stuff. Thus my questions to Christian and others regarding ESF, FED, FT Knox, Bis, LBMA, Vatican, "Black" Gold--the usual suspects. These issues are uncommon knowledge, but I know in my heart that the answers are not far away. Your "logic break" resonates completely with my thoughts, the cash and paper is sufficient to date to get the job done, why waste precious? "Black Market Cash"? Could anyone possibly doubt that? Why would the reality of black gold therefore be in doubt? Ecuador, Kuwaiit {sp?}, and Sri Lanka would not be in play if black gold were abundantly available at $270!
Everyone is so frightened of a larger than thought supply of gold that they "won't go there"! No need.
The other possibility is that the "paper" is unbacked by a physical foundation. To me, this is a key question! Gold has left the CBs in mass, as that is not paper I see on those Asian fingers and draping/covering the ME gold shop displayed recently. The shell game continues but the pea shrinks. Am I right? So, who is on the hook---US Banana, ESF, My Old Kentucky Home, or a combination of all these? Next time I have some rum with Alan Green-$pandex he'll surely tell.
Bottom line-- I believe in BOTH Black Gold {bad name for such a glittering substance} AND POG at your suggested "thousands". They are NOT incompatible.
Thank you, kind Sir, for indulging this curious cat!
Some small mining companies have fantastic resource's in the ground, and with no debt or mine to run they can wait it out, with fantastic upside in this awful market. Check out Madison or Minefinders or Minera Andes. If you want unhedged some of these kind of companies could be interesting.
>Anyway, here are four questions to attempt a jump-start in that direction.
>1. What are the odds of a dollar melt-down of more than, say, 25%?
***First I must ask against what? Is the question about Fiat in general or the US dollar? Personally I think all fiat has a very good chance of hitting the wall. After all that is what this forum is all about. Fiat is worthless, gold will rule. If you jump out of a plane, sans parachute from 5,000 feet, or 50,000 feet, you are just as dead. Yes I think if you compare the US dollar against the Russian ruble, it has a long way to fall, well over 50%. (the Russian ruble having already fallen some distance.)Against the Canadian dollar, I'm not so sure. The group of currencies most prominent in the world, or closest to the epicenter, (the US) are going to get hit pretty hard. These sort of collapses start at the fringes, and hit hardest at the center. The bigger they are, the harder they fall. In probably 5 years, but lets say 10 years time, I am sure you are going to find the odd US dollar floating around, just as 10 years after the US civil war, there were a few obstinate souls trading with other obstinate souls in confederate dollars for patriotic reasons.
>2. What's your best guess as to the most likely final equilibrium dollar index (or percentage drop)?
*** In what time frame? As above I expect fiat currency as we know it to fail, so ultimately, parity. Zero equals zero equals zero.
>3. What is your best guess as to time frame to the bottom? How long do you think it will take?
***All of these questions assume the financial condition in isolation. It is not. As Black Blade has so eloquently written, hydrocarbons not only effect the ability of the system to deliver foods to the cities, they also effect the ability of the farmer to produce food, in the form of fertilizers, but they also will effect the farmers ability to farm, because there will be no fuel to run a tractor with. If the hydrocarbons start to dwindle, and thus food, how are these people in high rise apartments going to fare? Are they going to grow enough food on their balcony to survive the long winter? What if they have no balcony? What is going to happen to our cities? Are desperate people going to try to take over a bit of farmland? Even if they do, do they know which end of a seed to plant up? Or does it matter? Will this have an economic effect?
The list of factors that are in crisis situation is long. It is not only the dollar, nor is it only the hydrocarbons, it also includes things like overpopulation, internationally the decline in the productivity per hectare despite increased fertilizer and pesticide usage, declining resources, such as fish stocks, increasing, and increasingly virulent disease, such as AIDS, and the superbugs. We have mortgaged our souls more ways than I care to count. And they are all pretty interdependent. Unfortunately, most of the graphic projections one makes, all go kaboom, by hitting the real steep part of the downslope, mostly near the end of this decade.
So, how do you want to define the bottom? I would think by 2050 it is likely that one would see the earths population down to as low as single digit percentages of the present population. Is that the bottom? Maybe, maybe not. How will the people fare with less resources than they had 100 years ago? (and certainly less training than their ancestors had at the same level of population,) The bright, but not definable, side is that technology may survive to make life a lot easier. But then you need a whole pyramid structure to make a computer chip factory. And it may have been trashed in the looting.
As I wrote previously, they are getting better at forecasting the perfect storm. The perfect storm is a confluence of smaller events, that arrive at the same place and the same time, which produces an effect that is far out of proportion to the size of its individual components, a tsunami wave that can wreck battleships, march around the world in days, and create havoc miles inland. (and which, like a hurricane, tends to be self reinforcing in certain circumstances)
Do not misunderstand, I am not forecasting the death of humanity, but whether certain specific individuals will survive not so easy to forecast positively. But then, it is pretty hard to accurately forecast anything when a tsunami wave is forming.
4. What is your best guess as to the duration of the economic effects? Will it be like Japan's ten years -- or more like 1987?
***Judging by the above, you can guess my answer-centuries. Even if I were forecasting the financial alone, I would still be inclined to forecast decades. The fall of fiat will, by itself, tear apart countries such as the US and Canada, as they struggle to save their treasuries and power structure. Sure something will arise to take fiats place. Goldbugs are betting that something is gold.
Well, now that you have invited a raving extremist nutter into your midst, what are you going to do? Do I get to post ever again?
Waiting for Christian to reappear {eagerly}, as he may be the teacher! I don't know any more than that he supposedly was censored. As far as thoughts of the $526 POG mentioned as "trade settlement gold" my guess is that Sir Oro can expound on this as he has had "parallel" ideas expressed in previous posts, one of which is in the HOF if my memory is still in service. Will double check tomorrow.
Best to all the goldhearts!
Nabbed a couple of small fry, but the real crooks continue to run amok. Same old story. SEC does it all the time - it's easy to convict the smaller players since they can't afford the high priced lawyers and don't have political clout.
I guess the CFTC can now point to the gold market and say they've been "on the job".
Comex traders face accusation
By Nikki Tait in Chicago
Published: January 10 2001 21:19GMT | Last Updated: January 10 2001 21:23GMT
Four floor brokers at Comex, the metals trading arm of the New York Mercantile Exchange, have been accused by the Commodity Futures Trading Commission, the US futures industry regulator, of fraudulently trading gold options contracts. Two of the brokers - Paul Merolla and Philip Selby - have settled with the regulators, without admitting or denying guilt. In these cases, the CFTC claims that the brokers traded ahead of incoming gold options orders from customers on 15 occasions between September 27 and October 5, 1999. The commission also claims that they changed prices on executed trades to the detriment of their customers on 10 occasions. September 28 was a record volume day in the Comex gold market. The two men face a six-month suspension of their floor broker registrations; will be barred from dual trading for a further year; and must pay restitution of $14,700 and $5,200 respectively, plus civil fines of $25,000 each. Allegations covering the other two individuals - Timothy Murphy and Vincent Coppola - are essentially similar, and involved trading ahead of customer orders on 10 occasions, and either changing or aiding changes of prices, to the detriment of customers, on 17 occasions. In these cases, however, a public hearing will be held to determine the veracity of the charges, and the suitable sanctions.
Black Blade: "Front-Running" is not that uncommon. What is uncommon is when anyone is caught. The actions of these individuals had to be blatant enough to attract attention. The real question is how many got away? The CFTC has been nothing more than a group of bumbling "Key Stone Cops." What is amazing is that they caught anyone at all. Charges have been leveled against PM traders and PM markets by the likes of Ted Butler over the silver trading issue, irregularities in the PGM futures markets, etc. Yet, nothing happens as the CFTC cannot find anything that would suggest market fraud. Hmmm...
http://toplist.island.com/toplist/top20.jsp?AH=on&frc=off&SORT=0After hours trading in the "New Economy" stocks does not bode well for the NASDAQ at the open. Most everything is in the red. Asian markets don't seem to be much impressed with todays last hour market rescovery as they are mostly down sharply. If this keeps up, tomorrow could be "interesting."
DJ NY Precious Metals Mixed Late; Gold Plunges On Fund Sales
NEW YORK (Dow Jones)--Precious metals were trading mixed late Wednesday, with gold futures losing all footing late in the session as any opposition to persistent selling by funds and locals disappeared, traders said. "We had fund selling all day long and local selling. And the bullion banks were buyers, just like yesterday. About an hour before the close, the bullion banks stepped away, and it fell to support," said Leonard Kaplan, president of Prospector Asset Management in Evanston, Ill.
Gold Not Seen Up Before BoE Auction
Dave Meger, senior metals analyst at Alaron Trading in Chicago, viewed the selloff in gold as mostly technical, with funds continuing to probe the downside after taking out the $267.50-an-ounce level and triggering a round of sell-stops, or pre-placed sell orders, below that. But the influence of the foreign exchange market seemed to be returning as well. Gold prices opened lower on the back of Australian producer selling overnight in response to the Aussie dollar's sinking below US$0.56, traders said. Tim Gardiner, head of precious metals trading at Mitsui USA in New York, had predicted a $265-$269 range for gold with the first Bank of England auction of the year set for Jan. 23. Prospector's Kaplan anticipated follow-through selling Thursday and didn't expect much bottom picking ahead of the auction.
For once, silver proved more sturdy, refusing to follow gold down to re-explore its own lows. The March contract on Comex closed 1.5 cents lower at $4.575 an ounce. "Locals were looking for (sell-)stops on the opening and sold it down to $4.555 but didn't find them," said one trader. Short covering by day traders and a large order by a trade house rescued it off its lows, he added. The trade house order, for between 100 and 150 lots, stood out in light of how thin the overall volume was, he said.
Light buying by funds and commission houses lifted Nymex March palladium another $38.40 higher to secure a new record close at $1,072.80 an ounce. One-month lease rates for palladium rose to 13% from 8% a few days earlier, another indication of how strong demand currently is, said Jim Pogoda, a trader at Mitsubishi International Corp. in New York. April platinum achieved a new 13-year high at $637.10 an ounce, up $6.10 from Tuesday, after hitting buy-stops, or pre-placed purchase orders, above $634. With a lot of end-users buying palladium for use more than a year ahead, Pogoda said platinum cold be benefitting somewhat from a substitution effect. But without further gains by palladium, he doubted platinum could target $700 on its own merits. Longs might just as easily take profits and sell the market down to fill a gap he saw between $622 and $624.10, he cautioned.
-By David Bogoslaw, Dow Jones Newswires; 201-938-2208;
david.bogoslaw@dowjones.com
(END) Dow Jones Newswires 10-01-01
Palladium ascent continues, market at new all-time highs
LONDON, Jan 10 (Reuters) - Palladium continued to dominate proceedings in European precious metals markets on Wednesday, with the metal reaching yet another all-time high, amid talk that Russian supplies would not be available until February. The autocatalyst metal was fixed at $1,063 an ounce this afternoon in London, up from the morning's $1,047 which was itself a record. Traders said that a lack of supply out of Russia, which exports two-thirds of the world's palladium, has been behind the price spike in palladium, which has risen over $100 an ounce already this year. ``The sky is the limit, as far as palladium is concerned at this moment in time, but there has to be a reaction soon,'' one trader said. ``Prices are already bumping against consensus upside forecasts for the metal,'' CSFB analyst Kevin Crisp said. ``There are very few hard and fast facts in this market so when the turnaround (in prices) will come is extremely difficult to call,'' he added. Palladium shipments were expected to begin in January after Russia's sole export agency Almazjuvelirexport (Almaz) signed long-term contracts with key consumer Japan in December. But deliveries had so far failed to materialise. ``People are afraid that we won't see any Russian selling until February,'' another trader said.
A senior source at Russia's state precious metals and gems repository Gokhran said on Tuesday it would sell ``a little bit'' of palladium when it finalises export quotas with the government in January. But no time-frame was given for the start of exports. Palladium prices, which were around $100 an ounce four years ago, have more than doubled over the past year, as diplomatic wrangling holds up supplies. Spot palladium XPD=kept up the move after the fix, and closed in Europe at $1,080.00/$1,110.00, up from Tuesday's New York close of $1,025.00/$1,045.00. Platinum XPT=was aided by palladium to some extent, and rose some $7 from the New York close to $637.90/$643.90.
The metal can replace platinum in some applications, such as autocatalysts to cleanse exhaust fumes of noxious gases, but traders said this was unlikely to be a driving force behind the price spike.
GOLD FAILS TO JOIN THE PARTY
Gains in the PGMs did not rub off on gold, however, as bullion continued to ease back in slow uninspired trading.
Prices drifted back under $267 support-turned resistance after a weaker Australian dollar AUD=encouraged producer selling overnight. ``There is not a strong direction for gold that one could discern either up or down,'' Crisp said. ``It is my belief that it is going to drift sideways to lower for the rest of the week.'' Spot gold XAU=ended at $266.35/$266.85 against a New York close of $267.60/$268.10 on Tuesday. Silver XAG=was down two cents with gold at $4.54/$4.56.
Black Blade: I know that some so-called analysts have said that palladium deliveries would be made by the first week of January, then by the end of January, and now it's February. This has gone on for over 2 years now. Come on people, wake up and smell the coffee! I know that in some circles in Japan, traders that hold contracts for delivery are livid. They now know in their hearts that there is no more palladium coming out of Russia for quite a long time. One could expect the TOCOM to be up to their old tricks again as they will likely default (again). There has been increasing talk that the NYMEX may just delist palladium for trade as any more manipulation schemes such as ridiculous margin requirements have become too obvious. As far as gold is concerned, there probably won't be much action until the BoE give-away on January 23rd. However, a strong wave of short covering could commence if the auction is strongly oversubscribed.
By GILLIAN FLACCUS
The Associated Press
1/10/01 6:46 PM
PORTLAND, Ore. (AP) -- The world's largest wind farm is about to be built on the Oregon-Washington border --
450 wind turbines that will generate enough power for 70,000 homes in 11 Western states.
PacifiCorp, an Oregon utility serving six states, joined wind power developer FPL Energy of Florida on
Wednesday to announce construction will begin next month.
Officials say they hope to have the wind farm churning out power for the energy-hungry West before the end of
the year.
Conservationists praised the plan as a breakthrough in renewable energy and a coup for the environment.
PacifiCorp has committed to buy raw wind power from the farm for 25 years.
"What you're getting here is a signal from one of the most significant participants in the commercial market that
wind power is ready for prime time, that it's marketable and profitable," said Ralph Cavanagh, energy
resources director for the Natural Resources Defense Council.
"It used to be exotic, an alternative," Cavanagh said.
Portland-based PacifiCorp has contracts with the Bonneville Power Administration, also based in Portland, to
supplement inconsistent wind power with hydroelectric power and distribute it across the Western power grid,
said Dave Kvamme, PacifiCorp spokesman.
FPL Energy will build, own and operate the wind farm.
PacifiCorp Power Marketing, a nonregulated subsidiary, will purchase and market the entire output of the
project over a 25-year period.
PacifiCorp was the first U.S. electric utility to be purchased by a foreign corporation when ScottishPower
completed its merger in November 1999.
FPL Energy is the largest developer and operator of wind energy facilities in the nation. It is a branch of the
Juno Beach, Fla.-based FPL Group, whose largest subsidiary is Florida Power & Light Co.
The new plant -- called the Stateline Wind Generating Project -- will straddle the Oregon-Washington border,
with 200 megawatts provided by turbines in Walla Walla County, Wash., and 100 megawatts generated by
turbines in Umatilla County, Ore.
The combined 300 megawatts will make the complex the world's largest single wind energy development,
PacifiCorp said.
Officials say the extra energy could help ease fears of rolling power blackouts in the Pacific Northwest, which
typically has a summer power surplus but needs to draw electricity from California in winter.
The energy crisis in California prompted Oregon Gov. John Kitzhaber and Washington Gov. Gary Locke last
week to urge Northwest residents and businesses to cut power consumption by 10 percent until spring.
"You recognize that every little bit is going to help. This farm, in and of itself, is not going to completely relieve
the energy challenge in the Northwest but it will contribute to solving it," said Carol Clawson, spokeswoman for
FPL Energy.
"Every megawatt matters. We've had times in California this past summer where an intact (power) grid and
rolling blackout was measured in just megawatts," Cavanagh said.
Power experts and conservationists say improvements in turbine technology have made wind power more
feasible, more profitable and environmentally sound.
The smaller, rapid rotors on older turbines have been replaced by slow-moving 240-foot tubular windmills with
rotor blades measuring 150 feet from end to end. Modern wind turbines can self-monitor, adjusting their
direction and blade angle to maximize on the wind's natural power.
The bigger and slower-moving rotors also solve another problem that had plagued wind farms for years -- the
death of thousands of birds caught in the spinning blades.
Various environmental groups, including the Renewable Northwest Project and the Blue Mountain Audubon
Society, were involved in the planning stages of the Stateline Wind Generating Project to make sure the site
wasn't in a flyway for migratory birds, said Rachel Shimshak, director of the Renewable Northwest Project.
And the project will be a boon for the local economy, generating 200 construction jobs and 25 permanent jobs
and providing local farmers with rent money from the lease of their land.
"Everybody's lights will burn a little brighter because of this project," Cavanagh said.
The following states will receive power from the new wind farm: New Mexico, Colorado, Wyoming, Montana,
Arizona, Utah, Idaho, Nevada, California, Oregon and Washington.
Both Harmony (HGMCY) and Goldfields (GOLD) are unhedged, however, I think that the GATA message from HGMCY may be referring to Newmont (NEM) and Homestake (HM) as both are very lightly hedged. Franco-Nevada (T.FN) is more a royalty company than a miner in spite of owning the Ken Snyder Mine in MIdas, NV. Other unhedged miners include Agnico Eagle (AEM), Meridian Gold (MDG). and Peruvian miner Compania De Minas Buenaventura (BVN). Unfortunately most other miners are hedged up the a**. This could very easily come back to haunt them...remember Ashanti (ASL) and Cambior (CBJ).
BTW, I would wonder if HGMCY, other miners, and the government of SA would sign on as litigants or file supporting affidavits along with the Reg Howe lawsuit? Just a thought.
That's very good. Quite cool actually. I have seen similar wind farms such as that at the Altamonte Pass in the Bay
Area. They have gone through several owners as they went belly up one after another. Under the current price
environment however, who knows. I know that some environmentalists are complaining about all the birds,
especially eagles and other birds of prey that tend to get "sliced and diced" by these huge "sky blenders." I understand that in Southern Kalifornia there have been similar problems with condors getting whacked as well. PETA (not the "People Eating Tasty Animals" � the other one), have been in opposition to these wind farms and also the solar farms (lizards and birds ya know). The left coast is a strange place, but maybe this time under the current energy crisis conditions, just maybe it could make a profit and not have to face a lot of opposition. Maybe renewable energy's time may be close at hand. However, as I read in the article, this is quite a miniature operation and would likely have no material effect on the energy crisis.
The Hobbits have stayed up late this evening "to take the curve and see that "unseen view"!" They are now worried that something may have happened to you, FOA, as you may have slipped on a rock in the dark and lost your golden light. Most are in favor of mounting a "searchparty"!!!! The Wiz has advised them that you are most likely just putting out fires and will return asap, but I had to promise them that I would assist them in searching at the crack of dawn, IF you have not return by then.
<;-)
Producers No Longer "Required" to sell Power to The Peoples Socialist Republik of Kalifornia!
California Power Talks Run On
By Patrick Connole
WASHINGTON (Reuters) - Government officials and utility company executives held marathon talks with no end in sight on California's power crisis on Wednesday, as one of the state's largest utilities begged for state help to avert a shocking economic failure in the Golden State. Pacific Gas & Electric, a unit of PG&E Corp. (NYSE:PCG ) canceled its dividend and asked for state money to buy natural gas to feed the power needs of consumers in the richest and most populous U.S. state. While the utilities floundered further, federal officials mediated a second day of negotiations at the U.S. Treasury, hammering out specifics of a framework agreed to late Tuesday by California state lawmakers, regulators and Gov. Gray Davis. Those talks continued into Wednesday evening with no end in sight. Unlike Tuesday's seven hours of discussions, which were led by Treasury Secretary Lawrence Summers, the wednesday ''technical'' round was attended by lower level energy officials, and utility company and power generation executives. ``It looks like they are negotiating the price of forward contracts and crunching numbers,'' said an official with electricity major Duke Energy (NYSE:DUK), a party to the talks. A separate round of hearings before an administrative law judge at the Federal Energy Regulatory Commission (FERC) on the issue of utilities being allowed to enter into long-term contracts for buying power were suspended. FERC Administrative Law Judge Curtis Wagner said the Treasury talks superseded his hearings for the time being. California has faced near-blackouts for more than a month due to tight supplies and soaring wholesale prices for electricity. The state's two biggest utilities -- PG&E and Southern California Edison -- have been forced to swallow costs of some $12 billion to buy wholesale power on the spot market to meet demand. California's landmark deregulation law of 1996 does not let them pass on the costs to consumers. Last week, SoCal Edison, a unit of Edison International's (NYSE:EIX), announced it would cut 1,450 jobs, or 13 percent of its workforce, to save cash. The utilities' dire financial condition also threatens U.S. banks, which loaned money to the companies, and could reverberate throughout the economy.
RICHARDSON WILL NOT EXTEND EMERGENCY ORDER
According to broad guidelines for seeking a solution released on Tuesday, the negotiators agreed on the need for out-of-state generators and marketers to give the state's embattled investor-owned utilities time to revamp their debts accumulated to pay for electricity. An industry source said Wednesday's talks were expected to ''carry over into Thursday.'' Once the technical details are hammered out, a prospective agreement was to be handed over to senior federal, state and industry representatives on Saturday for final approval, if possible. Tuesday's talks ended late at night with a vaguely worded statement which said all the participants would work together to resolve the crisis. On Wednesday, Energy Secretary Bill Richardson decided not to extend an emergency measure ordering electricity generators and marketers sell power to California, saying the state failed to show it was conserving electricity as required. ``The secretary has not extended the order, it will lapse at midnight (Thursday) because Gov. Davis failed to certify that the state reduced demand by 5 percent,'' said a spokesman for the Energy Department. ``The state failed to enact conservation measures,'' an Energy Department spokesman said. Generators have refused to sell electricity to PG&E and SoCal Edison since the firms are nearly bankrupt and would not be able to pay for the power supplied to them. Richardson ordered the generators in mid-December to sell the state power, and extended the orders until Wednesday's refusal.
FERC CHIEF RESIGNS
Amid the intense negotiations, a key policymaker announced he would leave his post. James Hoecker, a pivotal figure in the California power mess, said he would resign as chairman of the Federal Energy Regulatory commission. The five-member independent agency regulates interstate electricity issues. Hoecker, a Democrat, was criticized by California officials for failing to take bold action like setting a regional price cap on wholesale prices. Speaking at a regular bi-weekly meeting of agency officials, Hoecker told his fellow commissioners: ``Now is clearly the time for me to say, 'it's time for new leadership.''' Hoecker, whose term was scheduled to end in 2001, was among the policymakers at Tuesday's negotiating session. President-elect George W. Bush will choose a successor to Hoecker and fill one other opening on the commission. Among the top candidates rumored for the jobs is Pat Wood, head of the Texas Public Utility Commission, industry experts say. Richardson, who co-hosted Tuesday's session with Summers and National Economic Council Director Gene Sperling, said on Wednesday he felt hopeful a solution could be found to the crisis. Richardson also said he will continue to push for a cap on wholesale power prices in the Western region as part of the negotiations. ``I support regional price caps,'' Richardson told reporters at Energy Department headquarters. Supporters of the cap want the FERC -- which could mandate such market caps -- to revisit the issue. Last month, the commission refused to install the caps as part of its solution for ending chronic power shortages in the state.
Black Blade: The fall-out continues. The real story here is that not only are bureaucrats falling by the wayside, but rather that the order requiring out of state NG producers to continue supplying their product has been rescinded. Notice that that little point gets buried in the body of the article. Recession? � maybe full scale economic collapse is more like it. Hey, the USG says that it isn't inflationary and besides, they got the "New economy" to bail them out � right?
New York--Jan. 10--NYMEX Feb natural gas futures settled down 69.1 cents at $9.128 per MMBtu after the American Gas Association announced storage levels decreased by 167 bcf in the week ended Jan. 5. The number was at the lower end of pre-release expectations and observers indicated that the draw needed to be at the upper end of the range to sustain prices near record levels. AGA reported U.S. gas storage at 1,562 bcf for the week ended Jan. 5, down 167 from the previous week, and down 764 from the comparable year-ago period. AGA was expected to report that U.S. natural gas storage levels decreased by about 165 to 190 billion cubic feet, according to a BridgeNews survey of brokers and analysts. "I think (the 167) shows a pretty healthy loss of demand," said Salomon Smith Barney analyst Kyle Cooper. "That has some pretty serious implications for later in the winter." The market reacted negatively to the number despite the fact that the draw was larger than both the 111-bcf withdrawal during the comparable period of 2000 and the five-year average of 125.6 bcf. Storage levels are currently 32.8% below year-ago levels. One reason is that the last few weeks of January 2000 featured strong withdrawals that are unlikely to be matched, barring a significant cold spell. The next withdrawal of 114 bcf should be easily surpassed, but it would take significantly cooler temperatures to surpass upcoming withdrawals of 195, 242 and 213 bcf. "It will be very easy to reduce that deficit over the next few weeks," Cooper said.
In other news, the parent company of California's biggest utility Pacific Gas & Electric said it has asked Gov. Gray Davis and the Department of Energy to use emergency powers to prevent it from running out of natural gas. PG&E said it will be unable to continue buying natural gas as early as Friday from certain suppliers, which threatens its ability to provide heating fuel to its residential and commercial customers or to electric generators. "The utility believes that a gas supply emergency exists," PG&E said. If it is unable to buy more gas, it will deplete its storage by the second week of February.
OUTLOOK
The market may see some further weakening amid expectations that the storage gap will shrink in the next few weeks. "I don't think $8.000-$8.500 is unreasonable because I think the 167 has some pretty valid implications for lowering demand," Cooper said. The impact on demand due to high prices is increasing as more industrial companies announce plans to reduce or cease output because it is more profitable to curtail output and sell their natural gas futures positions, according to a Salomon Smith Barney research note. If this trend of lost demand continues, it could contribute to the shrinking of the year-to-year storage deficit although the company noted that some forecasts predict an Arctic air mass that could keep temperatures below normal during the latter half of January. Meanwhile, the weather forecasts continue to predict warm weather in the Midwest and Northeast, the two key consuming regions, into next week, which should put pressure on gas prices. However, the forecasts also predict cooler-than-normal weather for California, which is currently in the midst of an energy crisis.
Unusually warm weather is expected from Montana and the Dakotas eastward through Wisconsin and into Michigan Jan. 18-24, according to the National Weather Service said in its latest 8- to 14-day outlook. Above-normal temperatures also are likely in Nebraska, Iowa, northern Illinois, northeast Kansas and throughout the northern two-thirds of Missouri. Relatively cool weather is forecast for Oregon, California, southern Idaho, southwestern Wyoming, Nevada, Utah, Arizona, Colorado, New Mexico and western Texas. The remainder of the country will have temperatures close to normal.
Black Blade: The situation is still unchanged as storage is well below normal in excess of 32% below last years levels. This winter is the coldest on record so far � so much for the global warming scare. Winter has a long time to go with February and March usually being the coldest months. Also, more NG-fired power plants are scheduled to come on line. I would expect that NG supplies will be under a lot of pressure from here on out. Jerry Taylor of the CATO Institute gave a very dire report on NG tonight. He was on FOX news with Brit Hume. He and Matt Simmons of Simmons and Company International (an industry research Group), would make a good addition to any panel debating the energy crisis.
Peter, "it's" been bugging me all day, you are probably right with the personal flying gadget but I'm thinkin more along the lines of the Jetsons "scooter". Cool huh?
TG, always great to see the "trail up-dates" when I check in of an A'noon. As you are no doubt aware the "one atom" Au has bugged Scientists and Alchemists through time - as lately as last year they were trying to separate the "TWINS" in a particle accelerator in NY (didn't hear the results though). Ag has had a longer recent history as "money" than Au. The US "dollar" originally was equivalent to the "piece of eight" (silver) and then there's the Pound Sterling (1lb sterling silver) But of course, you knew all that.
Attn: eter Asher (01/11/01; 00:43:08MT - usagold.com msg#: 45442)Hi Peter Asher:
With all due respect, those numbers just don't add up.
"77,000 homes in eleven Western States". Sounds like alot.
But think about it: That's fewer homes than in a small
western COUNTY.
Next, their PR piece says "450 turbines" and later says
"300 MegaWatts" (100 in Oregon, 200 in Washington). If we
divide those 77,000 homes by 450 turbines, we find that
each turbine is to supply 171 homes. Not likely. I've never
seen any wind-driven device that can even begin to generate
as little as 15 volts with less than a *sustained* 28 MPH
wind velocity. Now, I know that's a windy area along the
Columbia River Gorge, but it isn't *that* windy, and for
sure, not on any sustained basis.
Dividing 300,000,000 (300 MegaWatts) by 450 turbines, gives
6.6 KiloWatts (6,666 watts) per turbine. The average house
consumes upwards of 10 KW to 20 KW per day. Yet their PR bit
implies those 171 homes to be powered by *one* such turbine.
171 multiplied by (average) 15 KW would require each turbine
to generate 2,565,000 watts (2.5 MegaWatts) per turbine.
Yet each (at optimum) can only produce a mere 6.6 KW.!.
The numbers just don't add up, and none of this even takes
into consideration the inefficiency of wind driven devices
nor the lack of a continuous *sustained* gale force needed.
It's ludicrous, and obviously they are trying to bamboozle
someone, for investment funds, or to wiggle themselves into
a lucrative power sharing/sale/provider agreement, to siphon
off Bonneville's *real* hydro-generated power at cut rates.
Is there a link/url to that story.?. That reporter really
got schnookered.
A check at Yahoo shows an Oz of Ag = �3.06 ie 3.06 Pounds Sterling.
When the Pound was valued in ounces of Silver, one � = 14 Troy Oz of Ag, sooo, in the hundred odd years since, the Pound sterling has been devalued by a factor of 45 (ish)- and this with Ag at rock bottom "price".
Yes Solomon, I think when the "great reality check" eventuates your "poor mans Gold" will do quite well indeed.
WOW! Platinum is up another $10.00 on top of a $7.00 jump today, and Palladium is up another $19.00 after a $26.00 rocket earlier. This is interesting. Not all that surprising as the Russians don't have any stockpile left, but interesting nonetheless. Palladium could soon rival rhodium maybe? I posted a while back that AngloGold was in a joint venture to research the use of gold in autocatalysts. That was published in a newsletter by the American(?) Gold Institute. That could be an interesting prospect as well. Meanwhile, gold is up a mere 20 cents after being clubbed like a baby seal on today's market.
Attn: FOA (01/10/01; 17:50:30MD - usagold.com msg#53)Hi Trail Guide:
That was some hatchet-job you wrote about Silver.
[snip]
It seems it doesn't make any difference that silver has failed every MODERN human
attempt to include it in hard money use and thought.
[unsnip]
Surely you don't expect us to believe that.?.
Have you never seen/held/spent, a US Silver Dollar.?.
You know, the ones that were *not* (ever) confiscated
when gold was forcibly surrendered to the governments.
Give us a break. Silver has more-than stood the test of
time as a historic *and* modern hard asset currency. Just
look around you. It's been everywhere, and is returning.
The coming price of silver will lead the price of gold,
kicking and screaming, into the stratosphere. Trust me.
Strange I was working on a post tonight and ran across something strange.
I was wondering if the US could be in the accumulation mode over the last few years. When I ran into this:
A clip from my post:
And as far as I know the official US gold price was last raised from $38.00 to $42.22 per troy ounce, in 1973.
Now we have the new Euro currency coming into play in the world . If Im not mistaken it has some % backing in gold. I think 15% but I could be wrong.
Question: At what price is the gold backing the Euro set at ? Tonight gold is at $ 265.90 US and
in Euro's 281.52 If I am correct in the 15% backing you would get 42.22 Euro. This is the same price as the official US gold price.
G'day Shifty,
Townie has been keeping us updated with Euro/Gold and their frequent re-evaluation of their Au reserves ie they Mark to market regularly - Your 42.22/oz would seem ANOTHER strange coincidence tho!
If the Euro was "backed" (convertable to) by 15% gold, then
fifteen percent of one Euro would be "gold". ie: if the Euro
had "pennies", 15-pennies-worth would be it's gold content.
Now then, if an oz of gold costs E281.52, it would cost, in
Euro-Pennies 28,152 of them. For one ounce. But wait...
We're only wondering about 15-EuroPenniesWorth aren't we.?.
So, divide 15 by 28,152 you get: 0.0005328 somethings.
Not 42.22 SomethingElses.
I'm not sure I understand your question.
http://www.usagold.com/onlinestore/special.htmlLast month the Swedish 20 Kronor coin sold out in less than a week, even before the News & Views newsletter came out announcing it as Coin of the Month. And fortunately Centennial was able to secure additional Dutch Kings after they initially sold out in the same timeframe.
And now, just days before the release of the new newsletter, I am giving you advance notice of the latest 'Coin of the Month' on-line offer to be announced. As charming as they get...Her Majesty Wilhemina as a young girl. Request extras...surely your daughters will all want several to call their own.
On Tuesday I provided the latest figures on the reserve position of the euro system of central banks. At current valuations gold forms nearly one third of their total reserve assets. You might want to scroll back two days for a quick look.
As for 'backing'...being a fiat currency, in truth the euro is 'backed' by the manpower and commitment of the collective borrowers to service their euro-denominated debt. Only if it fails, or if the ECB dabbles in forex intervention would we actually get a sense of 'backing' performed by these reserves.
I just closed my laptop, crawled out of the tent and found all these gold trail hikers ready to go? Before I check everyone's park entry tickets (and National park service golden pass cards for people over 60, (smile)) I must see my schedule.
Oh No! I forgot to place an AM after the meeting time in my last hike post. Oh Boy! I'll be back. Let me get some coffee and a pastry. Any French bread shops out here (small grin).
15% of $42.22 = $6.33
15% of $265.90 = $39.89
15% of E281.52 = 42.23 Euros
The old $42.22 was a fix and redeemability was not avaiable for U.S. citizens. There was only limited redeemability for other countries as they soon found when trying to redeem their fair share.
Randy is correct, I think. Zero redeemability speaks for itself. 15% of Zero = Zero.
http://www.news24.co.za/News24/Finance/Markets/0,1466,2-8-21_963751,00.html New York - NYMEX palladium extended its runaway rally toward $1 100 an ounce in nearly untradeably thin markets on Wednesday, two days after clearing $1 000 with no sign yet of needed exports from top-producer Russia. Attention was now turning to the $1 200 level, although with markets so thin and subject to volatile $50 swings, hard price objectives were not on offer from analysts. "People are just doing what they need to do," said a bullion bank chief dealer. "Then you've got some specs out there that are pushing it up. It's all going to be depend on when the Russians actually make delivery." March palladium ended up $38.40 at $1 072.80 an ounce, under the new high of $1 082.50 an ounce. Spot palladium was fixed at a record $1 063 an ounce in afternoon London business, beating the morning fix by $16 as shipments from Russia, producer of two-thirds of all palladium, failed to appear, despite promises of a prompt start in 2001. Cash closed shown at $1 080/1 110, but traders said two-way spot pricing was increasingly irrelevant because with supply so scarce little business goes though outside the fix. "Nobody even calls. Nobody even trades this thing," a refinery dealer said. "Just (at) the fixes. Or you can negotiate something. It's more of a negotiated market than it is any kind of a dealer market." Since 1997, bureacratic wrangling has held up Russian deliveries in the first half of each year. Prices have risen ninefold since then and have more than doubled from the low $400s in early 2000. Shipments were expected to begin in January after Russia's sole export agency Almazjuvelirexport (Almaz) signed long-term contracts with key consumer Japan in December. A senior source at Russia's state precious metals and gems repository Gokhran said on Tuesday it would sell "a little bit" of palladium when it finalizes export quotas with the government in January. But no time frame was given for the start of exports and the market is badly in need of large quantities for use in automobile catalytic converters - where most of the metal ends up. Demand has been driven by toughening global anti-pollution laws, even as a slowing economy cools US car sales from last year's record pace. April platinum hit a new contract high at $639 an ounce on palladium's coattails. It ended at $637.10, up $6.10. In London, platinum's afternoon fix was at $636, just below last week's 13-year high of $638. Spot went out at $637.10/3.10.
On the COMEX, February gold was having a tougher time, falling to a 16-month low in the afternoon in technical trade. It closed down $2.90 to $265.60 an ounce, trading from $268.40 to $265.50 its lowest since Sept. 17, 1999. "There was a long-term trendline on a weekly chart at $266.50," said Frank Bulfamante of Custom Floor Brokers. "Locals were really the ones pushing it. They just wanted to see it collapse but there is just not enough volume to really get this ball rolling." Estimated volume was 22 000 contracts, respectable given recent slow markets and falling open interest, but far from active. Small fund stops accounted for much of the late turnover, but were met by trade buying at the lows. Spot bullion was at $264.75/5.25 an ounce. It fixed late in London at $266.30 and closed on Tuesday at $267.60/8.10.
March silver slipped 1.8 cents to $4.575 an ounce, trading from $4.595 to $4.555. Spot silver closed at $4.54/56, off its close at $4.56/58 and up from the $4.53 fix.
Black Blade: Gold's turn next? Maybe on BoE "Give-Away-Day" on the 23rd of this month. BTW, USD is giving way to other world currencies this morning! Market futures are down as well. Could get interesting after the crummy earnings warnings from Yahoo, Cisco, and others.
What have I doneI think the problem is because what I said was out of context with the post I was working on. I got a few hr sleep now and I should be OK after a brisk hike on the gold trail.
Hi, FOA! I'll bet the USAGOLD Forum is going to jam up in a couple of hours from people who have been waiting for your next message! Thank you for taking on the silver issue (a very controversial one!). Two questions, if you wish to address them:
1. Isn't the new Moslem money supposed to come in both gold and silver?
2. Even if no one officially goes on a silver standard, isn't it a good idea for average citizens to have an asset that is compact, useful (so its value will never go down to nothing), durable, and rare (think of the silver short position!). That's what Mr. Salinas was saying, and to me it makes excellent sense. It makes a great barter item, and it can be readily sold. Who CARES if we're on a silver standard or not?? With all silver's virtues, it's just a good thing to have.
I just thought of one interesting thing: Once the dollar starts really going down, all the black money will seek a safe haven .... gold!?
This would heldp create an increased demand for physical gold instant delivery. How many of these fellas do you think will settle for a piece of paer? Ha!
I hope that this can clear up where my thoughts were at when I came up with the 42.22 Euro #.
As far as I understand, it is mathematically impossible to pay off the US national debt. Not because it is so large but because of the nature of the currency. As an example I will use the $hifty reserve bank. Now if everyone here was to borrow $100. $hifty bucks at 10% interest at the end of the year each person would owe the $hifty reserve bank $110. $hifty bucks. Now some would be able to repay with interest if they were able to make a few $hifty bucks from other posters at the forum. But because the total amount of $hifty bucks in circulation does not include any to repay the interest, some here would be forced into bankruptcy or they could borrow some more $hifty bucks from the $hifty reserve bank and things would continue. After 87 years ( age of the Federal Reserve System) you can see how the national forum debt would be way out of hand. The spending of United States notes ( not Federal Reserve notes) interest free into circulation by the government as JFK did with the red seal notes and to do so in the amount of the interest charged by the Federal Reserve it would make it possible to pay off the interest without anyone going bankrupt because of a mathematical impossibility.
Could it be ? Or is it just late and Im tired?
Could it be that the US Government has been in accumulation mode for the
last few years?
Picture this:
Because the US Treasury would want to buy without any fanfare they would
like things to be as dull as possible.
A statement like the one Greenspan made about "central banks stand ready to
lease gold in increasing quantities should the price rise" comes to mind.
Also to buy a large amount , the gold would have to come from someplace? We
hear about all this gold being sold but we never hear who is doing all the
buying. Also with all the paper gold dealings going on , would that be a bit of a smoke screen
so that the accumulation of physical would be less noticeable in the world market?
I remember someone here saying something about if the gold in Fort Nox was
to be divided by the US National debt it would be something like $70,000.00
an ounce. That sounds crazy but.......When was the last audit of the Gold
in Fort Nox ? I believe it has been some time. They could have a whole lot
more than people think or a whole lot less too.
And as far as I know the official gold price was last raised from $38.00 to
$42.22 per troy ounce, in 1973.
Now we have the new Euro currency coming into play in the world . If Im
not mistaken it has some % backing in gold. I think 15% but I could be
wrong.
Question: At what price is the gold backing the Euro set at ? Tonight gold
is at $ 265.90 US and
281.52 in Euro's. If I am correct in the 15% backing you would get 42.22
Euro (Euro was at .9445 when I did my math.)
This is where I saw the 42.22 pop up and I almost fell out of my chair!
I thought it would be close but to hit it dead on is strange. I could be wrong
but 281.52 divide by .15 = 42.228
The push for globalism in trade and interdependence would put most everyone
in the same boat if the markets and currencies went up in smoke. Yes?
How much gold would the US Treasury need to have in the vault to cover the
national debt at the same % rate as the Euro has backing? If they could
accumulate enough they could lift all the boats together when things go bad
for fiat world wide.
And not only are we going to have an economic down turn, but it will be accompanied by rising prices. The fed has indicated that they will loosen the purse strings when they reduced the interest rates last week which equals more dollars out there. But if the currency is worth less then how successful will successive interest rate reductions be? So what do we have to look forward to? RECESSION, MONEY INFLATION, PRICE INFLATION, and a silver lining . . . . rising gold prices!!! So get yours while you still can.
I've held the opinion for some time that responsible hedging is a useful tool in any commodity based business...the problem arises when delivery becomes impossible as too much is sold forward. The above link is from sharefin who posts over at Kitco. Also, see the link below for a specific example of how hedges are structured...notice that no gold is actually sold forward at TVX (silver is another matter).
http://www.awea.org/Good news about the new wind energy project...I've been interested in this alternative source for some time and thought I'd pass on a link for those interested. The link near the bottom right of the page titled "Wind Energy Projects" is well worth while.
We need to look at ALL forms of energy going forward. Yes, wind energy may never provide more than a small percentage of U.S. energy needs, but even that small percentage can be important. (The Danes are going bonkers on wind power...over 10% of their requirements will be provided by this source).
BTW, Shell has a plan to construct wind platforms at sea - wind there is constant.
Well, TrailGuide...I have to side with ThaiGold on this one. Silver has historically filled a role which gold could not...namely, that of making up the composition of coinage meant to be traded on a daily basis. Yes, gold coins have been minted throughout the ages, but they've traded very infrequently in commerce - gold is just too valuable!
Gold is better suited as a wealth preserver - silver as a hands-on commerce facilitator...the founding fathers knew this when they set up silver as a major component of U.S. coinage.
Will E-Gold allow gold to flow as currency in a manner which it hasn't been able to in the past? I have not been convinced one way or the other, but am keeping an open mind.
Most farmers like gold miners hedge
(bet) to affirm income which is used as
collateral for debt service the capital
needed to cover production costs to get
production to market. I like many other
farmers end up with a contract with a
selling price below cost of production.
You can't let the banker know that and
still expect to get the money to
operate. The farmer does not determine
your forward sale price. Most farmers
like miners end up with a hedge below
cost of production and no way to
participate if the price of that crop is
much higher because of some disaster. On
the other side you have the banking
system a system of credit creation based
on fractionalization (sp?) of $300 gold,
the price most gold companies hedge teir
production. They use a $3000 "credit
creation POG which is the
fractioanlization of $300 gold by a
factor of 10 exactly what is used with
the fiat for bank required reserves. As
a farmer I had one advantage miners do
not have and that is inflation on the
land. The increased land value unlike
the decreased stock price of most gold
companies provides me with additional
worth. However hedging- being forced to
sell at a price below production can not
protect anyone who lacks the means with
which to force a contract's fulfillment.
Hedging to me is an economic function to
expropriate wealth. So is selling
commodity gold for $270 when the credit
creation gold POG is $3000. Not just the
interest payment that would require that
more be returned to an only source but
some of the principal also has to be
obtained from it that was never created.
So you end up borrowing more to pay
original loan. And that is usury. --GE sencored me from posting this. I would like to know which side they are on. They could very well be part of te gold cabel. They will never look into the credit creation GOLD POG because it is dangerous to one's physical and financial health.
The Hobbits have now settled down to await the trip to view around the curve on the GOLD TRAIL. BUT, they have now decided to get FOA a 24 Hour watch and set it to GMT!!!
--
PS: to Lady Leigh --- The Hobbits have completed the project of preparing the US Postal Service PROOF mailing device and are sending off again to you and yours. CROSS your fingers!!
<;-)
This is very interesting...I am looking for a candid response from silver advocates
Of all those who more highly favor silver ownership over gold ownership (Centennial can happily fulfill your needs with either metal, so in this business regard this is not a sensitive subject of "us" against "them" whomsoever "us" may prove to be and whom "them" may prove to be in this discussion), would you please detail the circumstances of your support for that position?
Meaning, do you harbor a natural, internal affiliation for the white metal, and as a result you have sought out whatsoever justification you can find to rationalize your silver preference? (I know that some gold advocates fit these shoes regarding their affiliation for gold over all else, paper and pale metals.) Or, did you start with a clean slate (or nearly clean as Sir Holtzman would allow), and then objectively evaluation the situation at hand, history, and current "rules of the game" to arrive at your position to favor this argent metal?
As for me, I once knew no affiliation for gold, but embarked on a study of "all" that comes to bear on "money". In the course of my journey, the natural events of the case spoke only and objectively of gold in such high regard in this monetary realm. That is where I stand--without throwing stones or passing judgement upon others--and that view is what drew and allied my operation at The Tower with Michael's Castle (Centennial) and ultimately led me into this role to fill the shoes of 'sitemaster' while sharing such thoughts and news of gold/money as you have come to see over the years.
1. Much of my writing time was taken up this morning answering a query from a financial reporter, so I haven't had time to weigh what's going on in the markets. I'll try to get something out, time allowing, later today. The major point I would like to make though is that those who followed our advice and captured stock market profits by switching to gold have achieved our first objective. (We have heard some horror stories in recent days from those lured into the NASDAQ ambush.) I still think the Dow will be the next to break, even if the NASDAQ starts back up again. We would suggest a continuation of the diversification process or to start now if you haven't already. We see this as a primary bear market in stocks, not just a correction. The next objective for gold investors will be to take advantage of a potential emerging bull market in gold based on the following factors (in simple form):
--- the gold carry trade unwinds to less invasive levels
--- investors move to gold worldwide as domestic currencies erode against goods and services in local economies and energy prices skyrocket
--- U.S. based investors -- a potentially enormous market for gold -- begin to realize that a 1970s style stagflation is in progress and that gold is the best remedy to see it through.
A bull market in gold (if we are indeed in one) will start slowly but this is a long term process and we shouldn't expect miracles. Remember our primary objective is asset preservation and for many of us, the first objective has already been accomplished. The next stage -- a bull market in gold -- is conjecture at this point, however, if you are buying gold as a store of value first, then a price run-up over the coming months and years might be a happy side benefit. I see events moving us in that direction and I've mentioned this in the last two issues of News & Views (the January is now at the printer).
2. The orders are coming in for the Wilhelmina Long Hairs faster than anticipated and we are running out of this first group fast. If you want some I would suggest either calling or using the on-line ordering system. We have been criticized for not giving fair warning in the past and we can't control this. I'm trying to locate more, but so far no word. Maybe we'll get lucky and be able to reserve more, but if not what we've got is all we've got.
Message from David G BEFORE FOA message #54Am playing messenger again. This just in from David G. Will look for response to FOA's most recent. END I took a look at Trail Guide's message and also read Auspec's response.
I didn't entirely understand the point TG was making, but I haven't been following previous threads and that may be the reason why. Large quantities of black AU (that is to say not subject to official figures) are certainly sitting in various depositories around the world and additional quantities have still not been recovered from various treasure burial sites.
I cannot imagine that anyone in their right mind would consider, even for one minute, carrying bars of gold around with them - unless they were in the habit of weight training as they worked. Of course, the culture of the east has developed a far greater zest for gold than it does for fiat money and it is not unknown for those who deal in narcotics to change their cash for gold.
However, black gold is traded in the sense that ownership changes for a consideration in a parallel market that, for want of a better description, we can call the "black market." AU of this description has also been used as backing collateral in transactions where the metal has been hypothecated. This, however, jumps us into an altogether different parallel world that is separate to the black gold market per se - albeit they do "reverberate" upon one another at different levels and for different reasons.
There is also an argument that certain quantities of black gold have been, or are being acquired, repatriated or re-acquired and that this may account in some measure for the present price manipulation. This is certainly a possibility and, again, might well be part of a parallel operation that works at an even deeper level than the derivative story.
Message from David G BEFORE FOA message #54Am playing messenger again. This just in from David G. Will look for response to FOA's most recent. END I took a look at Trail Guide's message and also read Auspec's response.
I didn't entirely understand the point TG was making, but I haven't been following previous threads and that may be the reason why. Large quantities of black AU (that is to say not subject to official figures) are certainly sitting in various depositories around the world and additional quantities have still not been recovered from various treasure burial sites.
I cannot imagine that anyone in their right mind would consider, even for one minute, carrying bars of gold around with them - unless they were in the habit of weight training as they worked. Of course, the culture of the east has developed a far greater zest for gold than it does for fiat money and it is not unknown for those who deal in narcotics to change their cash for gold.
However, black gold is traded in the sense that ownership changes for a consideration in a parallel market that, for want of a better description, we can call the "black market." AU of this description has also been used as backing collateral in transactions where the metal has been hypothecated. This, however, jumps us into an altogether different parallel world that is separate to the black gold market per se - albeit they do "reverberate" upon one another at different levels and for different reasons.
There is also an argument that certain quantities of black gold have been, or are being acquired, repatriated or re-acquired and that this may account in some measure for the present price manipulation. This is certainly a possibility and, again, might well be part of a parallel operation that works at an even deeper level than the derivative story.
All of the gold that was at FT Knox is now at 55 Water Street New York City. As far as BIS is concerned they have a problem. Our $ is fiat, Euro$ is fiat and the Swiss Frank has no choice but to go fiat. I am Swiss myself and my name is Christian and I know for sure that the Swiss are forced to sell the gold and they are buying Euro's with it. Faction 3 which are the children Faction 1+2 (elite) own most of the gold at BIS. They and wealthy Swiss are dumping all stocks and buying metals. I say metals because what they are buying is not all gold. ESF gold uses the gold at water street to settle trade deficit at BIS. All countries settle their trade deficits or surplus at BIS. Trade deficit will be a real problem for this country when it no longer can take commodity $270 gold to settle trade deficit gold priced at $526+-. We are in for at least 10 years of deflation and commodity gold will slowly go down in price. The only thing that will turn that around is when people use gold for currency which I think will never happen. If people use gold for their own credit creation then gold has a better chance. Gold companies do not know what they have and they will never figure out how to use their product as a source of money. They have no choice but to sell out everything they own to the cabel. I have contacted over 70 elected representatives and out of that Gore's running mate Lieberman has been the most honest. He will in writting tell you if you are on the right road map. Same goes with Susan Collins. However these elected officials are afraid of the power of the cabel. No one will or can take them on. It's every man for himself and the only weapon you have is do not borrow and if you have to create your own credit which is easier said then done.
I am sure that you are aware that the last (or near last) of US silver has been turned over to the US Mint. Reserves of gold still (we think) stand at 8,000+ tonnes. On a commodity play silver is 'short' considerably moreso than gold.
On a monetary front there is no currency backed by gold, the endless, circular discussion of such is speculative.
IF, there is such a monumental storm whereby gold does in fact reach many thousands per once, then dollars would be worth 'dimes'. In such an event gold would be confiscated, there IS precedence of this my friend.
Silver on the otherhand, IHMO, would ride on the back of gold (as would all PM's) but would not be confiscated for two reasons;
a) sheer bulk
b) there is no precedent of such.
In speaking with several large silver dealers in the last couple weeks, one oz. silver is non-existant, 5, 10 and 20 onze bars are non-existant and rarely a 50 oz. is available.
Most dealers are selling 100oz.and upwards.
---New York, Jan. 11 (Bloomberg) -- The euro rose against the dollar and surged to a 14-month high versus the yen, as traders bet Europe's economic growth will outpace the U.S. and Japan.---
AND
---The dollar has already dropped about 7 percent in the last two months against a basket of currencies of its major trading partners, on growing concern the U.S. economy may be headed toward recession.
The one glaring exception has been the yen. In trading today, Japan's currency fell to 117.53 per dollar, its weakest since July 22, 1999, as falling Japanese stocks heightened concerns about the world's No. 2 economy.---
Dollar falling against many currencies with the yen falling a bit faster...both essentially marching "arm and arm into oblivion". Who would have ever thought or predicted such a thing?
Now, consider again a previous commentary on the fate of the gold market wherein the price discovery is currently joined at the hip with the dollar through the derivative structure. As the dollar weakens against currencies of the gold-buying nations, so would a "steady" dollar gold price via their exchange rate provide them with ever cheaper gold. Market busting physical demand will destroy the dollar-based paper gold market. As in these foreign marketplaces, we too shall one day know what it is to work days of labor for the reward of one gram in payment/savings. Reality is often where you find it. Be sure to read FOA's Gold Trail post today...he covers this item well.
Our poster Nightingale mentioned this important news about the HKMA earlier today, and here is a bit more on the topic....
---Also boosting the euro today, an official at the Hong Kong Monetary Authority, whose $107.5 billion foreign reserve holdings are the world's third-largest, said the authority has added euros.
"In the past month or so we have held more euros," said Joseph Yam, HKMA Chief Executive. "There is a possibility the U.S. dollar may weaken against other currencies. That is why we are going to hold more euros."---
Beware the potential flood of unwanted U.S. bonds...
In addition, I read in the paper this am the annual GFMS report on 'offical' sector gold holdings for the year. It is down again, I believe the 9th consecutive year. I'm sure this info. would be available on their website.
The 'monetary' play of gold Sir becomes more speculative by the day. The 'commodity' play of gold is good (supply shortfall vs. demand) IF one concedes the fact THAT officaldom will hold or increase gold forever. However, it is a fact that offical sector gold has and is decreasing because THEY do not see the monetary role of gold as once was. The 'commodity' play of silver presently and I will quote Ted Butler on this one 'Is the best risk/reward in the last 100 years."
I just recieved a very interesting vial in the mail, (blame OUR post office) That is real interesting. I thought you said flakes, not nuggets. Thank yopu VERY< VERY much
A question; does most gold come in a white rock, and If one finds a white rock like that, without knowing more, is it worthwhile to examine it closely for gold? I recall a dyke that was way out from nowhere, and the friend/aquaintance with me was I think a geoligist. (lot of years ago) He turned a bit strange that evening, but to my knowledge, there was never a mine at that location
Many years back, in my personal experience(s), a very crude yet very intelligent and effective man once said; "Look guys, we're past the point of a kiss, movie and a glass of wine. It's time to consummate the marriage (or words to that effect)". The glass is still half full. I've been following everything you have written over the last 20 months--everything. While you are talking and thinking thoughts on a plane much higher than most of us here, the fact remains, we're waiting, waiting. Whither your endgame? At the end of the day, at least a few of us will require some degree of tangible satisfaction. "Just show me progress." Thanks...CM
As usual I have read the latest Hike on the Gold Trail. I will reread it many times trying to understand completly the way we are headed. It would seem to me that it is clear that only Gold can hold the wealth of the world. Better to hold a little gold than a lot of silver. 40 oz gold at the price today would buy a lot of silver but when gold is revalued to refect the wealth of the world it will "Go to the Moon , Alice!!" Silver will not follow. White Hills
for Randy (@ The Tower) (1/11/2001; 11:35:14MT - usagold.com msg#: 45488)candid response from silver advocates
Being very small in financial stature, at first I had a strong bias toward buying silver rather than gold. Only because it seemed so much more 'affordable'. I finally realized (through hard experience) that buying cheap things because they seemed more affordable, was a false savings. I became sick of the low quality, short life span of the appliances, guns, cars, etc., that I had purchased. I wish I had learned the lesson earlier in life - I might still have some of the higher quality items instead of memories of the junk that had to be discarded.
But, more to the point, I am still strongly persuaded by Ted Butler's (mostly) commodity-driven arguments for silver.
Now I own silver & gold. The latest Gold Trail post seems to ravage the idea of silver investing, but I think you have clarified the issue by stating:
'Of all those who more highly favor silver ownership over gold ownership'
Freedom -
KB
I really don't see it as an "either or" issue as to whether paper currency should be traded for gold OR silver. Personally, I like the idea of buying gold and some silver (75%+ gold) for long term holdings. Some extra silver then can be purchased with the the intent of selling if the opportunity arises for a nice gain. I feel more comfortable having the majority of my holdings in gold for the duration (read: death).
Well. I'm stuck here for a while and updates are still coming through, so:
Paul van Eeden,
Sorry I couldn't place your name correctly when I used it at the Gold Trails. From where I am, I could not access the Gilded Opinion at the time for clarification. Nice thinking, sir.
Randy@ The Tower,
You are right, our dollar and the Yen sure are joined at the hip. Yes, that whole system is going down with us and they will inflate just as much. Can happen no other way. I remember that just a short time ago (or was it a year?) someone here was pushing the Japan market as the place to be. Ha! HA! In short order they beat a hasty retreat from that stance, having sold out first and telling us all after the fact.
No, I'm "on trend" and following Japan down the path and owning bullion and Euros in good proportion to other assets. Everyone here will know when I start allocating out of this mess; that's when West Texas oil fields will start pumping orange juice because $200 oil won't make them any money in our super inflationary environment (smile).
Yes, the HKMA are in line with several other nations as they waver between unloading dollars and keeping them. All the Asians are looking to each other for another reserve, but none of them can afford the impact a regional system would give them. These guys don't trade with each other the way EuroLand does, so they are drifting into Euros kicking and screaming all the way. Once China discloses openly what they are doing privately, all the other Asian Block will run into Euro Zone. China will do the largest tradeing with Europe ever known. Did you see the C1 piece in the WSJ today. Oh yes, "" Europe is the Place to be""!
I want to see where Alan puts all those foreign held treasuries as they come running home. Our bond market is sure to get the shakes, even as the Fed guns the money production. Some change of perception. By the way, that old "super wealthy" fella I mentioned sometime ago,,,,, that he
placed all his 25+ years of gains from big mutual funds,,,,, Yes, he put most of it in physical gold and still thinks the stock markets will go higher. Indeed, his Mutuals, he sold did not take much of a hit. He's right so far in that almost all the US market gains were built on money inflation and he
thinks they will drift even higher as it all unwinds into real price inflation. Only he says gold will boom well past all that once the dollar structure cracks. This is his 80++ year old thinking and doesn't know anything about our reasoning. Small world.
No offense met in that last post. I'm the guy that sweeps up after your poker game and caddies for you (was once a very good caddy). Hope you understand I understnad but I live each day in a world where results are achieved each and every day. Not impatient just wanting to get to, "the end of the day" and, "move on".
Fed adds a pile of permanent and temporary reserves to banking system today
When the need for reserves looks to persist, the Fed opts for outright purchase of Treasury securities to add permanent cash reserves to the banking system. And so we see yet another buying operation today. This time the Fed has called for bids on $654 million in Treasuries dated February 2008 through August 2022 for delivery on Friday.
To satisfy the immediate needs for cash reserves, the Fed also participated in an $5.49 billion overnight repo operation collateralized mostly by agency securities.
But that is not all. The Fed also entered into a 28-day repurchase agreement totalling $1.995 billion built utilizing a mix of Treasuries, agencies, and mortgage-backed securities.
Busy day at the Fed, boys. Take a break and have a sandwich.
Ha! Ha! I'm not going to tough that one, my friend. But as to "progress"? Well, if you are watching my position you see someone with most of his unneeded cash in Euros drawing interest.
Yes, I still have dollars because I need those darn digital currencies to buy garden seeds and pay the help. Funny, how those fiat system don't go away no matter how worthless they become. Hell, in Brazil they still use the same money. Some people I knew were living there during the 1,000% days. Oh boy, and they still use the stuff. Yes, real life has a habit of proving my point that we are not going back to any gold based currency again. It's just the way we are.
I own physical gold in serious proportion to assets and don't care what the paper price goes to. As long as it's lower, I will buy more over time. Current gold falling in price offers some evidence of pilling on by sellers of paper contracts. But once the gold banking system cracks, I know there will be no physical offered during the next several hundred percent rise. Soooo, I got mine.
I own some gold stocks that I expect to ground to almost zero if the system does not crack first. So far, right on target. Again I'm holding for the profit they will make on the last $1,000 an ounce above massive taxes and production controls. All done after this transition. Yes, controls and taxes will keep the first $9,000 but I make plenty on the last bunch. No, I do not expect them to keep up with bullion.
Time wise, the WA was the first real shot that the BIS, ECB and others were willing to see the demise of our dollar gold block. To date, they are selling it down the drain. Besides all this, I guess nothing much is happening (smile).
=========================
Silvercollector,
---The 'monetary' play of gold Sir becomes more speculative by the day.-----
You are right there. The new EuroLand initiative is phasing out monetary gold in lieu of asset gold. Look closely and you will see this is in essence the entire GoldTrail and the BIS / ECB are on our side.
---The 'commodity' play of gold is good (supply shortfall vs. demand) IF one concedes the fact THAT officaldom will hold or increase gold forever.------
No my friend, the commodity play for gold is dead in the water. The game is how much can the paper gold market expand until it loses all credibility and fails. This sudden shift in our US economy is the result of several factors coming into focus at the same time. Oil, Euro credibility, dollar's
timeline end and our own expansion of gold banking to prolong the dollar. It's all havind an impact on curent gold dealings. As for officialdom holding gold? Again look closely and you will find that none of their gold has been lost, it's just been sold as a currency pairing asset (smile). This is nothing new as it's been going on a long time.
---However, it is a fact that official sector gold has and is decreasing because THEY do not see the monetary role of gold as once was.-----
Absolutely!
---The 'commodity' play of silver presently and I will quote Ted Butler on this one 'Is the best risk/reward in the last 100 years."--------
My friend, today is absolutely the worst time in history to buy yourself into anything labeled a commodity that carries leverage. Because, most every commodity market is swollen in dollar expansion, they will all crack badly when the dollar world fails it's debt. Silver is good, I own some and have said so before. But I also carry $100 dollar bills as assets along with $1.00 bills to spend. In the same light I don't expect those $1.00 bills to ever take the place of or gain on my $100s. Silver is in the same boat, we will trade it but it will not gain the wealth credibility of gold. Further, just as in Brazil, silver will have to compete tomorrow with circulating dollar cash as a currency.
Yes, digital, inflating currency will be everywhere and be used everywhere. In such an environment "I don't need that much silver because I got cash and gold".
Also, I think it was Golden Truth that I last posted to here,,,,,,,,,, some long time ago that I would buy some platinum and Palladium. I did then and still own it. But, it is just an investment, not a wealth savings replacement. It's done well but, in fact, some other investments have done better than these metals.
=====================
White Hills
---"Go to the Moon , Alice!!---
Ha! Ha! That's right, my friend!
====================
Knew-bee
Welcome! Yes, own a little of all of it, but as Dirty Harry said "know your limitations". I say understand the difference between diversified world class savings and narrow investment risk.
================
silvercollector,
----On a monetary front there is no currency backed by gold, the endless, circular discussion of such is speculative. --------
No currency should be backed by gold because all such systems fail from human intervention. That is why we are proceeding to an asset based system based on the real fundamentals of a true supply /demand dynamic. All performing in a Free Gold marketplace.
--IF, there is such a monumental storm whereby gold does in fact reach many thousands per once, then dollars would be worth 'dimes'.--------
Absolutely.
----In such an event gold would be confiscated, there IS precedence of this my friend.----
Now that is a "circular discussion". I say, Legal Tender gold held by US residents could be at risk.
------Silver on the other hand, IHMO, would ride on the back of gold (as would all PM's) but would not be confiscated for two reasons; a) sheer bulk------
Yes, that is good logic. It's also the reason investors will not give up using paper currency in exchange for silver. The real precedent here is that governments like Brazil will print whatever denominations are necessary to keep currency use going. We, likewise will save gold and Euros but spend cash. Silver will be on the outside looking in.
-----b) there is no precedent of such.----
Well, there was no precedent for gold taking before they did it,,,,, was there (smile)
------- In speaking with several large silver dealers in the last couple weeks, one oz. silver is non-existant, 5, 10 and 20 onze bars are non-existant and rarely a 50 oz. is available. Most dealers are selling 100oz.and upwards. Is this true of gold lately---------
I bet it's true of steel. That stuff is just flying off the shelves,,,(big grin)! My friend, these silver stories are as old as the hills. Wait 30 years, they will make the rounds again in Europe.
It's looks like Alan Greenspan has firmly embarked upon reliquification umpteen + 1. We at USAGold are pretty sure this is not going to end well, but apparently he isn't, at least not yet.
Remember his "peanuts" speech a while back? It came out around his renomination a couple of years ago. He justified his acceptance of continued tenure because he found the whole process (central banking, i.e. economic manipulation) so "addictive" that it was like eating peanuts -- once he started, he said be couldn't stop. How's that for confidence instilling?
I believe he knows the damage he's done, but acting either personally or under order (more likely), he is going to push this thing right to (through?) the wall. It's a big experiment at this point. How long can a fiat bubble economy be sustained and what can be learned in attempting to sustain it to its ultimate conclusion?
ATLANTA (CBS.MW) -- Delta Air Lines said that it will take a charge of $60 mln in the December quarter because of adherence to an accounting standard on derivative instruments. Specifically, the company (DAL) said $56 million is related to the adoption of Statement of Financial Accounting Standard No. 133 and the other $4 million is from the early paydown of debt. Delta adopted SFAS 133 on July 1.
-----------------------------------------
--- What do you mean by "allocating out"? Thanks.-----
Perhaps buy some companies or other assets. But, that will be "in the thick of it" and by no means a total sell out. For most of us, that's me, the coming storm may last most of our remaining days.
ALL: Please don't mis read me. My long running point is to show the nature of things outside our Western View. Every day, around the world, people deal and cope with failing, changing financial life. We all, too, can deal with what is coming as long as we stay open and informed to world
events. Presently, our world is in the grips of a New York broker perception.
It seems to them that everything about wealth can be handled with an option, future or mutual fund allocation. You want to save some Euros as a diversity? Never mind that it's a real functioning currency for a collective nation bigger than ours,,,,,, the NY advice it to buy some Euro options.
You want to back your meager dollar savings with some solid gold, the NY answer is to buy some Bre-X. Or, whatever.
Across this nation, I see a people hardly ready to spiritually and family wise cope with a "real downturn and serious inflation",,,,, and they are leveraged to the end. Yet, trying to use their credit cards to buy some silver mine stock. Oh yes, they owe five times their net worth, but hope that 100 ounces of silver and some $2,000 in a mine will pull them up even with the big boys.
People, that is a crying shame. The advise should be to change your lifestyle "Radically" and get out of debt ASAP. Then save some of our nasty digital currency. Then diversify into things that will never fail to hold value. A poor person, and that is many of the people that are currently being scared enough to think about hard assets, must consider buying the best first and the least last. Paid
up in full as able! Because you can hardly afford to take a chance when the chips turn down.
Sorry, I'm just waiting for time to pass and I'm jumping on a high horse.
Is this just to impress us that they are on the ball in watching that there is no jiggery-pokery goings on - or that no one can get away with it? So four minnows are caught in the net, while the big fish swim on.
From News at KITCO
Regulator accuses Comex traders of fraud
By Nikki Tait in Chicago
Published: January 10 2001 21:19GMT | Last Updated: January 11 2001 10:56GMT
Four floor brokers at Comex, the metals trading arm of the New York Mercantile Exchange, have been accused by the Commodity Futures Trading Commission, the US futures industry regulator, of fraudulently trading gold options contracts.
Two of the brokers - Paul Merolla and Philip Selby - have settled with the regulators, without admitting or denying guilt.
In these cases, the CFTC claims that the brokers traded ahead of incoming gold options orders from customers on 15 occasions between September 27 and October 5, 1999.
The commission also claims that they changed prices on executed trades to the detriment of their customers on 10 occasions. September 28 was a record volume day in the Comex gold market.
The two men face a six-month suspension of their floor broker registrations; will be barred from dual trading for a further year; and must pay restitution of $14,700 and $5,200 respectively, plus civil fines of $25,000 each.
Allegations covering the other two individuals - Timothy Murphy and Vincent Coppola - are essentially similar, and involved trading ahead of customer orders on 10 occasions, and either changing or aiding changes of prices, to the detriment of customers, on 17 occasions. In these cases, however, a public hearing will be held to determine the veracity of the charges, and the suitable sanctions.
Bank of Montreal analyst Susan Stearns said there was further support from speculation that Dai-Ichi Life is planning to shift to euro-denominated debt.
Poor old Greenspam is sure taking some stick. However, have you noticed, he always seems to keep a smile on his face.
Does he know something we don't?
He certainly doesn't look a picture of robust health. He must be well past his sell by date (his three score and ten).
Well, this got me thinking. Could it be that when he knows that the sh*t is just about to hit the fan,( and he will be one of the first to know), he will have a conveniently arranged minor heart attack (or similar), that will cause him to 'retire'?
Thus, it will appear that it was this unfortunate incident that precipitated the ensuing debacle, and that had he still been at the tiller, he would have steered us through.
Then, of course, at his age, it could be the real thing.
Is he preparing to sacrifice himself for the greater glory of 'the cause', like the Kamikaze pilot? Has he been assured that his name will then be forever enshrined in hallowed halls of the grand temple of the Cabal?
Naw, that sort of thing couldn't happen, could it?
I have to agree with both Pandagold and Ted Butler. Pandagold is correct when he says that Ted Butler has been trying to make money with the same song and dance for many, many years. I believe Butler is also correct when he says demand for silver has outstripped supply for about a decade now. It seems whenever supply is just about exhausted, Bingo..more appears. Did Marcos find a silver bonanza buried by the Japanese during WW2??
But, I thought you might be interested in knowing there are options available for those of us patiently waiting.
Examples
Dec. 2001 800 call for $160
or
Dec. 2002 1200 call for $255
(not a typo--that's year 2002)
These are for the "long haul" or the "buy and hold" type investor. Sould I say investor/speculator/gambler??
If silver ever goes to say 15-20/ounce, we're in the money. If not and Dec. 2002 arrives, then the moneys all gone. Buy some to hold no matter what and if you like to speculate and you think it's going up,...the choice is yours. As for me, well, I do know the prices now, don't I.
Good luck
Rich
I noticed your comment: "Even so, the day after our Fed lowered rates, the ECB did an equal thing of importance; they stayed still! Our Euro friends are in the drivers seat now" and it reminded me of a telephone conversation I had recently with my real estate broker in Spain. We were talking about the direction of property values there (they are on a real tear, lately) and when I asked what he thinks about the near-term direction, he replied that he was recently talking to his banker who said there was speculation circulating about a rate increase as the European economy continues to grow. He mentioned that the buzz in Spain was that the US economy is contracting. All this occurred well after Easy Al made his surprise rate cut the other day. If the Europeans actually do raise their rates, it will start to look like the Fed is blinking, all right... In fact, it might even start to look like they have closed their eyes for a nap. (Smile)
And while you are here, I would like to say that I have been enjoying your Gold Trail writings lately. I would like very much to get out more often, but it is winter here in California, as you know... And we are having a power crisis, which everyone seems to gloat about. However, we also do have some very scenic mountians here out here. Some of the streams up there even have golden trout in them. They're not very big, as trout go, but they do respond well to fly-fishing. Please let me know if you are ever out here and need a fishing guide. I'd love to show you around.
I am still hopeful of receiving a response from David G regarding FOA's Black Gold comments/dismissal. In the meantime I might as well make a couple comments:
From FOA's "The Curve"-- "Remember, Black Market production could not have existed prior to, say 1971, as even public mines were not making cash profits." Now there is a Western mind thought if there ever was one. It will take a lot more than that to "burn that story in the fire". This statement seems to totally dismiss centuries of gold production that is not totally accounted for in the "official" above ground gold stats. Please remember, Forum readers, that Asian gold production stats are largely non-existent. NO ONE knows the amount of total above ground gold, and anyone who thinks they do is .............. shall we say "blindfolded"? Anyway the story went in your fire, but I must continue past your "curve" onto the straight part of the path. Let's each use our compasses to take us home via our separate paths, and then exchange stories of our adventures when we arrive at final destinations!
One more final note--- I can't find your exact words, but they were to the effect that "they" are on "our" side. Looking at it from a bit of a different perspective, it seems that "they" are on "their" own side and we are simply going on for the ride/survival. I have a hard time thinking of any of these CBers being on "our" side {other than cb2}.
Thanks for your Guidance Sir!
What a show they put on for the record, busting some idiots
and spewing it to the media before this GATA thing hits the fan. What kind of #^$#^ing moron could not see this for exactly what it is? I wonder if these are actually 'traders' or did they just make up some names?
By the way FOA is right. Who needs useless non-monetary metals like silver........or palladium....... platinum......
rhodium......... it's not worth anything. JUST LIKE GOLD FUTURES!!! NO ONE EVER MADE MONEY ON NON-MONETARY METALS.
Please send ALL of your useless palladium metal to me.
I have an account that produces tiolet tissue. As I was leaving, I walked out the door with an employee I ocassionaly work with. I ask him how energy prices were impacting them. He said that their costs had increased by $900,000.00 over the previous month. He said that they were going to increase their prices next month. As he was in a hurry, I didn't have time to ask him if their increase was going to totally offset their increased energy costs. When I find out I will report, providing there is any interest.
This is a pretty good size mill with hefty sales dollars, but I don't care how large an operation is, this kind of increase is serious. Any guesses as to whether they had factored this in when they were doing their forecasts last year?
The Stranger - Partial answer to your inquirery about the box business
Stranger, sorry that I have not answered you. I have some information sitting on my desk, but have not had time to read it, so any answer from me would dated. I will try to answer this weekend.
I do have a question for the knights, that will give a clue as to what I think may be going on. What would it be called, if an industry, for decades, responded with price decreases fairly promptly to a downturn in demand, but today, due to plant closures, unschedualed downtime that wouldn't have taken place just a handful of years ago, and mergers making the industry much smaller in numbers, does not reduce prices today? To my way of thinking, this is not stagflation in the purest sense, but must be some form of staflation. Is their a term for this?
It's called "controlling the supply side" and while you're at it tossing the knuckleheads overboard and getting some "clear thinkers" at the helm. BTW, the Aussie is a definite wildcard.
We are in the 72nd year of a 50 to 60 year credit expansion cycle. The Fed has been very good at rescuing us from ourselves. They can only postpone the inevitable for so long. This year could be it!
What could happen to the economy as a whole may be understood by following the recent history of Xerox Corp. Early last year Xerox disappointed the rating agencies (S & P, Fitch, etc.). So they reduced their bond ratings. Xerox now had to do all their borrowing in the commercial paper market. Xerox disappointed the rating agencies again and they reduced their commercial paper to junk status. That means is was now illegal for most of the money market funds to buy their paper. Xerox now had to borrow the money they needed from their banks. When their credit was still good, they extablished major lines of credit with their banks for a small fee. Now that their credit was no good, their banks are forced to lend them up to the credit limits, which they have recently done. Somehow, bankers have never been very good at protecting themselves from future eventualities. (This is my way of saying that few bankers have an IQ over 107.)
So the sceranio is this. As companies sales drop, their credit ratings are reduced and their borrowing in forced into the banking system. The banking system is tiny comparied to all the various other alternatives that major corporations have to borrow. Commercial and industrial loans of the whole banking system is only a trillion dollars right now. As borrowing is forced into the banks, the spreads will widen tremendously between government paper and bank loans and paper.
Companies will try to borrow their way out of this recession just as they sucessufully did the last one in the early 90's. It probably won't work this time.
I believe this will be worth watching if Maria gives enough room for complete answers to whatever questions she is given to ask. Rich
Subj: Tocqueville on CNBC
Date: 1/11/01 10:36:04 AM Eastern Standard Time
From: NEWS@Tocqueville.com (News at Tocqueville)
Sender: NAF@Tocqueville.com (Natalie Frohlich)
...NEWSFLASH...
�
Tocqueville's President, Robert Kleinschmidt, will be a guest on CNBC's
"Market Week" with Maria Bartiromo�on Friday,�January 12th, 2001�from 7.30 -
8.00pm (EST).
�
The "black" gold story has been misconstrued by Trail Guide. TG obviously has not read the material written by D. Guyatt and is in no position to comment on it.
To refresh the USAGOLD readers about the "black gold" story, the millions of tons of gold in question were allegedly stolen by the Japanese and Germans in WWII. It is not new gold mining production and has not ever been construed as such.
When the WWII conflict came to an end, the stolen gold disappeared from the above ground market. The persons or groups controlling this gold has been content to keep most of the gold buried for 55+ years so they can circulate paper gold certificates and fiat money.
Some of the gold has allegedly been laundered through gold mining companies. Have you ever wondered why there are so many big shot politicians on the boards of ABX and FCX?
My call: The existence of XXXXXX tons of "black" gold will not effect the crash and burn of paper money. Buy you physical while the price is low.
auspec, you offered these comments:
---From FOA's "The Curve"-- "Remember, Black Market production could not have existed prior to, say 1971, as even public mines were not making cash profits." Now there is a Western mind thought if there ever was one. It will take a lot more than that to "burn that story in the fire". This statement seems to totally dismiss centuries of gold production that is not totally accounted for in the "official" above ground gold stats. Please remember, Forum readers, that Asian gold production stats are largely non-existent. NO ONE knows the amount of total above ground gold---
There are a few thoughts I would like to share on this matter as food for thought. Frankly, I find it difficult to fathom a SIGNIFICANT variance from the generally accepted estimates of total historical gold gathered into above-ground human ownership.
To begin, it is helpful to consider that experts have calculated that in our present time in the rich history of mankind there are now more people actively striving above ground than the sum total of all our human ancestors that have ever been laid to rest below ground. Meaning, if we could reanimate the dead, they would not provide enough dance partners for us, the living.
If we consider the progressive development of civilization at all steps along the way and the primary struggle for survival from tribal hunting/gathering to what we have now, we quickly see that time and manpower would not have allowed for such massive gold production in the centuries before modern times...specialization of labor and heap leach technology. The absence of both chronicled historical AND archaeological evidence of such massive amounts of "extra" gold via mining operations would have required that it was first merely pulled up easily like old pavement on an abandoned highway, and further, that incentives existed throughout all of history that it not be put to open use for the wealth benefits it might bring/buy for its owners. This does not pass the nasal appraisal.
Musings on geologic, anthropologic, and archaeologic evidence and realities--particularly contrasting past capabilities with known performance today--along with historic chronicles seems to conspire to leave precious little room for a significant abundance of gold to exist beyond the oft' cited totals...ballpark 130 thousand tonnes, three sovereigns to each above-ground man, woman, and child with our old "dance partners" left largely dispossessed.
In the past six weeks M-3 has grown a breathtaking $162 billion. This equates to annual growth of $1.4 trillion. Trouble is, M-3 is only about $7 trillion in total. So, what the Fed is now doing is growing money at a rate of about 23% per annum.
Judging by the partying going on at the NASDAQ this week, a lot of that money must be chasing after technology stocks once again. Amazingly, there even seems to be a preference for companies whose fortunes are the grimmest. Today, PC manufacturers and semiconductor outfits were among the strongest groups, even though anyone with an IQ over ten knows the sales of both are slumping badly.
The big question is, now that the dollar is finally dropping against the euro, the U.S. economy is in recession and inflation is at ten-year highs, why is gold still going down? Well I sure as heck don't know. But if you ever wonder about the logic of the markets, you can stop now. There isn't any. Period.
Meanwhile, what is going on between the electric utilities and the state of California is straight out of Econ 101. To wit: Excess money growth plus price controls sooner or later beget supply shortages. Maybe if we would elect more learned economists and fewer bleeding heart lawyers we wouldn't have to keep relearning stupid lessons like this.
Boxman, you better refresh my memory. I don't even recall the question.
With all the "shock and dismay" regarding Yahoo!'s disappointing results and less than optimistic forward guidance,I immediately thought of ORO'S excellent post of some months back regarding Yahoo!'s entry into the S&P500.
I can't recall the exact date,however, I do remember the stock trading at around $300 with a total market cap in the $100 billion range.
ORO illustrated in a detailed fashion the lack of available free trading stock,the obvious tax and earning benefits accruing to the company from ESOPs, and the fact that a multitude of pension and index funds were being forced to buy what appeared to be a concept stock by said inclusion.
So here we are, a little further down the trail and 80 to 90 billion dollars of market cap have disappeared into the ether.
I guess what really troubles me in this regard(aside from the fact I didn't short Yahoo!)is who is responsible for this debacle.Whoever it is who decides which companies should belong in the hallowed 500 obviously didn't do thier due dilligence on this beauty.For God's Sake,all this company really seems to be, once you remove the hype and noise;is a search engine with a really neat name.
Yet,no-one in the media seems to want to expose what appears to be a monumental fiasco that has created such a huge transfer of wealth.New millionaires and billionaires have been created on what seems to be a combination of a mania, a good promotion and of course,a little help from Uncle Al the liquidity expert.
Astounding,absolutely astounding.
And to think of all these billions of dollars magically appearing and disappearing in a seemingly never ending flurry and yet an ounce of gold goes begging for a lousy$264.50.
WGC and GFMS :As a regular Gold-buyer and Goldmine shareholder, I am not impressed at all, with the Gold-information you are providing.
Your insights are poorly contributing, to understand, what is happening with Gold. May I suggest that you use your budgets to lobby with potential goldbuyers, advise and guide them. Get Gold on the road "again " as an Investment.
Foreign governments ( Japan / China / Europ ) official dollar-holdings increased from '89 to '00, from 432 Billion US$ to approx. 1 Trillion US$ ! Whilst this same US dollar carries a trade-deficit of 420 Billion/yrs. The currencies of Gold-producing countries, with major underground reserves (South Africa / Australia / Canada / S. America) are badly detoriating.
Wouldn't it be nice, if your efforts could lead to a justified Gold-investment by these governments ?
An announcement that you would undertake such an initiative, could add some relief to suffering Goldholders.
In other words : DO SOMETHING PRODUCTIVE !!View
Yesterday's Discussion.
It would perhaps be an interesting exercise to find out which countries are increasing their gold reserves, and which are depleting them. Some of them, we are well aware of.
Why?
I was thinking (I do a lot of that these days), could it possibly be that in order to establish a sound international economic functioning of this �new world order� in which, it appears currency for the masses will be digital, that the individual units ( once known as countries) will use �real money� (AU) for settling scores, er� sorry, accounts in the final analysis?
A number of countries, especially those in the old Russian block were probably a bit deficient in this area. To move such an agenda with the cooperation from all, it would obviously be necessary to have some degree of control (hold) on the POG during the redistribution from �haves� to havenots�.
It was just a thought. But how well it would have served the preserving of the US dollar in the process.
Russia is stocking up, so here is one for a starter
Sorry my friends (do I have any?) for hugging this space, but I am re-printing this one. The more I think about it, the more I think it has great possibilities, so want to share it with as many as possible and I know we don't all have the time for 'looking back'.
)Is this the way out?
Poor old 'Greenspam' is sure taking some stick. However, have you noticed, he always seems to keep a smile on his face.
Does he know something we don't?
He certainly doesn't look a picture of robust health. He must be well past his sell by date (his three score and ten).
Well, this got me thinking. Could it be that when he knows that the sh*t is just about to hit the fan,( and he will be one of the first to know), he will have a conveniently arranged minor heart attack (or similar), that will cause him to 'retire'?
Thus, it will appear that it was this unfortunate incident that precipitated the ensuing debacle, and that had he still been at the tiller, he would have steered us through.
Then, of course, at his age, it could be the real thing.
Is he preparing to sacrifice himself for the greater glory of 'the cause', like the Kamikaze pilot? Has he been assured that his name will then be forever enshrined in hallowed halls of the grand temple of the Cabal?
Poland had one of the best banking records in the world while it was communist -- at least for foreigners. It never defaulted on any deposits or interest, etc. The reason? It had a bad reputation as a communist country and couldn't afford any "bad press" at all.
SAN FRANCISCO (AP) -- Higher utility bills are not the only way Californians are likely to feel the financial pinch of the state's energy crisis. Climbing electric rates are squeezing businesses operating in the state, and they're beginning to pass the burden on to consumers. The Jack in the Box burger chain has already increased prices, and egg and dairy producers may soon follow. ''Some of our combos will have a 10-cent price increase,'' said Jack in the Box spokeswoman Karen Bachmann. The price hikes went into effect Monday at the chain's restaurants in California and Washington. The state Public Utilities Commission has approved temporary hikes of 7 percent to 15 percent in businesses' electric rates, to help utilities stung by soaring wholesale electricity prices. That energy bill increase, in addition to the state's 50-cent minimum wage raise to $6.25 an hour that went into effect Jan. 1, caused Jack in the Box to increase some menu prices. Michael Sencer, who runs an egg-production company, says the cost of producing 1.25 million eggs daily has risen dramatically over the past year, thanks to climbing electric rates. ''I was paying 3.5 cents a kilowatt the beginning of 2000. In December I paid 35 cents per kilowatt. Unbelievable,'' Sencer said. The Western United Dairyman trade association plans to ask the state Department of Food and Agriculture to let milk producers charge more. Making milk is energy intensive, said Jay Goold, an economic analyst for the association. ''You've got to pump a lot of water and you've got to run a lot of machines that develop the vacuum,'' Goold said. ''Milk comes out of a cow at about 100 degrees and you've got to get it down to 45 degrees real quick.'' Many supermarkets have focused on dimming lights to lower energy costs, but they haven't ruled out having shoppers pay more at the register. ''I would believe that with prices going up, it would be a natural course of business that some of that would have to pass through to consumers,'' said Dave Heylen of the California Grocers Association. Rising energy costs have put flower growers in a bind because they can ill afford to pass on the costs of keeping greenhouses warm. Stiff competition from Colombian and Ecuadorian flower growers force California growers to keep prices low. ''You are going to have a lot of growers just decide to close up,'' said Lee Murphy, president of the California Cut Flower Commission. ''The big guys are getting bigger and the small guys are disappearing.''
Black Blade: No need to worry, it is not inflationary - not in the CPI core-rate, just ask the boys and girls at the BLS. Maybe they can prove that the food and energy is better quality, so through "hedonic" pricing statistics, it is really deflationary! Yeah, right, I'll believe that when monkeys fly outta my butt smoking Cohibas. BTW, there are many people in Arkansas, Texas, and Oklahoma still without power due to the Christmas storms in that region. Those who took precautions for Y2K probably fared very well in comparison to others. Makes one think doesn't it? What if there are rolling blackouts in Kalifornia? I'm willing to bet that there will also be rolling riots, lootings, and shootings! BTW, didn't the Peoples Socialist Republik of Kalifornia outlaw several types of firearms? Hmmm� Hey, life is just beginning to get interesting.
Once again, I find myself waiting for a travel connection. Thank goodness for USAGOLD.
=================
RossL,
Well, my first reply is; As Mr. Fleckenstein often say, "you are not connecting the dots".
I am giving Black Gold the same association as Black Market Gold dealings. This broad name gathers up all gold produced, refined in some reasonable fashion and used in commerce or black barter. It also covers what would have supplied excess, unreported official holdings.
The main points for us to consider when digesting Mr. Guyatt's work is:
Much of the past world gold production both White Market and Black market, prior to say late 60s early 70s, went into paper currencies. That is to say it was sold for industrial use (for paper money), sold to governments for reserves or coinage (for paper money), or refined into worldly recognized and tradable bars (again later sold for paper money). The amount of this pre-71ish gold production that was mined, refined and retained was very small compared to the off record amounts channeled into secret places as described.
The reason this perception is correct in negating our author is that all the gold, Mr. G. speaks of, is in some vault, somewhere,,,, it is not in raw ore form. The process of refining, at that time cost as much as the gold was worth.
Soooo, in order to build these vast stores of gold, not recorded before, would have cost the owners, at the time, more capital to retain it than to sell it for cash and just keep the cash. Further, as our bright Randy points out, during the period that this volume of Black Gold had to be built up, world production could not have come anywhere close to supplying it (dug on the side and out of sight) as any major profitable ore bodies were closely followed by everyone in the business, including governments. Remember, it's only the modern advent of Heap leach and the recent run over $100oz in the 70s that created the ability to mine cheap bodies.
I agree, there is a lot of gold out there in circulation and it is large. But, that gold does exactly what private gold does best; it circulates as is. No one in their right or wrong mind would use that gold to issue derivatives against in the way Mr. G. suggests. Yes, recent bullion owners can and do sell their holdings for cash and the BB then leverage that bullion into x paper. But, that is the same process I have pointed out for some long time now. Such circulating gold has been used to fill the demand gap as it's owners become single derivative holders. But, more to the point, the derivative printing is leveraged 100 times this actual physical inflow by the BBs. If indeed, the supply was balanced, there would be no reason to leverage with paper supply, they would just sell the gold outright and drive the price.
Further,
Yes, the gold may have been stolen and put into storage. But it could not have been in the excess amounts described, beyond worldly knowledge, because of the above production realities at that time. Hell, even small time outlaws, taking and selling thoughts or software require some kind of
infrastructure and collaboration in the open market to succeed. Much less take, store and paperize million of tonnes of gold bullion. Connect the dots.
================
Randy
As yourself and Stranger point out, the money supply rise is breath taking! Again, I say, for the first time in our history we are about to feel the effects of reserve currency competition.
As pointed out further back in the GoldTrail, Allan will not tighten again. To do so will fully concede the dollar. His only avenue in this "new world" of money warfare is to forget the dollar's value and retain it's usage as
much as possible. All done to combat the Euro.
We started down this trail when the Washington Agreement put us "on the road" to high priced gold. The fed will now "manage" a progressive destruction of dollar credibility.
That will entail:
----a loss of credibility of the entire gold market system and corresponding bid down of it's transactions and assets---
----a falling dollar vs the Euro-----
----a falling interest rate environment on par with the recent decade of Japan experience-----
--- the use of our 1980s monetary control act that allows the fed to buy debt from all comer's---
--- a stock market that will not fall as much as we think
(use the old German example here)-----
--- the loss of our ability to shield ourselves from price inflation by buying cheaper foreign goods---
--- the growing loss of trade as China and EuroLand evolve into "the trading block" the world strives to deal with-----
---- real life hyper inflation as this country and generation have never known -----
We are on the road, my friend. It's going to be some ride.
=========
Michael, Thank you for your messages! (smile)
==========
Souce WGC : Major holders outside WAG
Taiwan : 422 ton
Russia : 411
China : 395
India : 357
I've been told by someone who pretends to know (??)...that China is accumulating and more specific : London auction-gold at the lowest price possible ??? Smile !
This sounds reasonable to me, since HGMCY is selling directly to Chinese government. Presently 15 tons a year.
If Big buyers could be convinced of making their acquisitions public ...this would be a confidence boost. HGMCY did say so !
Or do they want to accumulate at rockbottom prices and tell us loud and clear when it is all done ? Give me a smile please, when this fairy tale is true.
Thanks, but what I would like to know is the change in holdings over the past say five to ten years. I am not sure if we have records for many of these ex- Eastern Block countries when they were allied to the USSR.
I would like to know how the world's gold supply has been redistributed. This, to me, could perhaps shed some light on what has been happening. I am talking about ACTUAL (REAL)
gold, the kind that breaks your teeth if you chomp on it - not the kind you could light your fires with, or wipe your ar*e on.
I have some interesting thoughts on China and gold which I will share with you later. ( I have spent some years out there, and have a great admiration for that country). Of course, you guessed something like that from my name?
Black GoldRandy---You wax eloquently with your "nasal appraisal". I like that. I do see some progress with the Black Gold issue in that we have an element of agreement: You apparently agree that NO ONE nose {ha} for sure how much above ground gold there is. This is very good and an excellent place to start with all gold advocates. THE OFFICIAL FIGURES ARE BOGUS! So the significance of the VARIANCE becomes the question.
May I make a few points for consideration? I gave up necrodancing years ago, but that is an interesting observation about the "above ground" population of potential dancers. Most modern mines typically explore in locations that the "locals" have worked for years, and this production was/is unofficial. This is going on throughout the planet as we contemplate the issue. There are also issues of theft/parallel mining then and now.
Do you purport to know how much gold the Vatican {for example only} has? The House of Saud and neighbors? Underworld gold/drug trafficing? Rothschilds? Oppenheimers? BIS deepest vaults? I am not saying I know, because I do not, but the official numbers do not allow olfaction satisfaction, to put it mildly. That much I do know. We cannot overlook Asian gold production, lots of people, lots of years! Gold mining is not just a Western and Modern phenomenon and there are few records of Asian mining. Mining can be as simple as a guy with a pan or pick. No private gold hoards in existence? All this Japan/Marcos/Asian stuff is make believe? No Nazi gold leftovers? The official world is just a bit too "tidy" in its thought process at best. What percent of all these factors impact the market?
FOA's areas of expertise lie outside the realm of Black Gold, no one "nose" it all. So we learn and move on. Apparently Ross L, ORO, Christian, and a few others have widened their vision enough to take in this spectre. Hopefully they can pitch in for further enlightenment. David G may be typing as you read this one! Speaking of David , Randy, have you done a thorough pate evaluate {boo} by reading "The Secret Gold Treaty"? Make sure you punch up ORO #s 40664, 25821, 25765, and others also.
Many think this underground gold has been used up to a degree over the recent years in suppressing the US $ cost of gold, and now that they are running low they turn to the "paper chase". How much has been used up and how much is available at our current ridiculous commodity prices???
The DEMAND numbers may be actually way off the charts in not explaining the huge supply that has been absorbed!!
I keep hearing the supposition that the CB gold is merely changing hands among various CBs, but can't buy this concept fully. Too much has been sold to the market and is in the hands of individuals, IMO. THE MAMMOTH SHORT POSITION EXISTS! The reaction to WA proves it without a doubt.
Gotta go now---hope you get over that stuffy nose!
Best,
auspec{troscope}
DJ Gold Slide Splits Analysts; Worries On Jewelry Demand
(This article was originally published Thursday)
By David Bogoslaw OF DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--A precipitous decline in gold prices since Christmas, even as key currencies such as the euro and the Australian dollar have strengthened against the U.S. dollar, has market analysts split in their views of where prices may be headed this year. For most of 2000, before the bearish economic indicators began to mount, U.S. dollar strength had been seen as gold's main nemesis, pushing the price of gold ever higher in terms of foreign currencies, which both incited producer hedging and squashed consumer buying interest. The February contract on the Comex division of the New York Mercantile Exchange traded as high as $278 a troy ounce the week between Christmas and New Year's. Thursday morning it hit a low of $263.90 and had bounced to $265 by the afternoon. Most market watchers weren't surprised by gold's robustness just before year-end, recognizing that traders were far less interested in selling than in squaring positions for accounting purposes. Call it gold's bad luck that just when the U.S. economy started turning to the downside, taking the greenback with it as a matter of course, the yellow metal has begun to be viewed more as an industrial metal than a monetary asset. Market participants have been saying that the currencies' influence on gold prices has shrunk to the point of being marginal.
Gold Vulnerable To Slowdown In Jewelry Demand
As an industrial metal, gold is much more vulnerable to a decelerating economy. Predictions that the U.S. was sliding into a recession rather than just a hard landing, such as that made by Morgan Stanley Dean Witter's chief economist Wednesday, didn't help. The jewelry sector's domination of the demand side and the linkage between consumer spending and jewelry demand didn't bode well for gold prices this year, according to a London-based analyst. "If consumers have less money in their pockets, we need some other buyer of gold to step in and pick up the slack," he said. "The investor isn't there at this time." MKS Finance SA, the Geneva-based investment firm, anticipated in its market forecast for 2001 that weaker physical interest would bring gold under renewed price pressure in the first quarter of the year but saw demand recovering after that. "A consistent price recovery is expected in the second quarter of the year on the back of a major global currency trend change leading to a weakening USD," MKS said in the same forecast. Frederic Panizutti, head of strategy at MKS Finance, said he expected investor and jewelry demand to kick in before the summer and saw gold trading between a low of $260 and a high of $320 for the year. But the weakening economy isn't the only negative weighing on the gold market. Market players said they continued to be concerned about the impact of central bank selling. Some traders said gold was being sold short ahead of the first Bank of England auction of the year, of 25 metric tons on Jan. 23. But Panizutti said, "The Washington Accord will be a useful tool in a higher-demand environment because it gives a limit in terms of selling and lending. It will tighten or limit supply on the upside." Under the Washington Agreement of 1999 central banks agreed to limit their sales and lending of gold. Panizutti expected lasting weakness in the U.S. dollar against many major currencies to have a positive impact on gold prices but said it would be a gradual, not a drastic, development. Far more bearish in his forecast was Andy Smith of Mitsui in London, who saw the gold price trading between a 23-year low of $210 and a high of $290 an ounce. Smith warned against "ambulance-chasing a dollar fall" and predicted a rise in hedging activity by mining companies just trying to survive the wave of low prices by selling production forward. Salomon Smith Barney's weekly futures report saw a slowdown in producer hedging as supportive of higher gold prices but said a meaningful recovery in gold prices above $300 would be unlikely without much stronger investor demand and a significant drop in gold supply from the official sector. The London analyst also said the market couldn't depend on the investment sector to be a long-term buyer and holder of gold, particularly in Western markets, where people prefer other assets to insulate themselves from an economic downturn. Even if they did turn to gold as a safe-haven asset, investors' time frame is fairly limited, he explained. "They buy and then they sell, as happened with the U.S. eagle coins at end of 1999, purportedly for Y2K," he said. Only the jewelry sector could provide the long-term consumption the gold market needs and that was increasingly unlikely given the gloomy prospects for the economy and disposable income in 2001, he said.
This morning's report completes the year 2000 series. The official core rate rose 3.6% for the year. As thoroughly massaged as this number is, it is still the biggest increase since 1990.
From the behavior of the bond market and the POG, it is clear that most on Wall Street and in Washington believe the inflation threat has now been vanquished. This morning Bill Clinton was even quoted as saying, (and I paraphrase), "I believe we will have continued healthy growth for the foreseeable future with just enough moderation to contain inflation".
Don't you believe it. All the Fed did the last couple of years was raise short-term interest rates. They did NOT subdue the growth of money, and in fact, recently they have really opened the floodgates once again.
Let's be clear about two things. FIRST: THE RECESSION IN SILICON VALLEY WAS NOT BROUGHT ON BY THE FED. SECOND: CONTINUED RAPID MONEY GROWTH MEANS MORE INFLATION IS ON THE WAY. With this in mind, ignore the pollyannas who think the Fed can bring goldilocks back anytime soon. It ain't gonna happen!
Britain's National Audit Office Report On U.K. Gold Sales Raises More Questions Than Answers
Source: Business Wire
Publication date: 2001-01-11
NEW YORK--(BUSINESS WIRE)--Jan 11, 2001--A report issued by Britain's National Audit Office on the sale of a substantial part of the U.K.'s gold reserves and which is designed to see whether the British taxpayer has received value for money from these sales has raised more questions than answers, said the World Gold Council which represents many of the world's gold producing companies. However, the WGC welcomes the NAO's criticism of the British Treasury implicit in the reports recommendation that "the Treasury could give further thought, in consultation with the gold market, to using the London Gold Fix as an alternative or additional means of selling gold." "We knew the NAO report would not question the wisdom of selling off 415 tonnes of the country's 715 tonnes of gold; that was excluded from NAO's brief right from the start," said Miss Haruko Fukuda, Chief Executive Officer of the WGC. "But leaving aside government's failures to provide economically compelling reasons for this sale, and ignoring the fact that (according to independent opinion polls) the majority of the British public do no wish the country's gold reserves to be depleted, we find it odd that the final report should contain some important inconsistencies," said Miss Fukuda, who went on to detail the following as being the most significant:
- Early on, the report examines different methods of sale in terms of transparency, value for money and fairness. It judges the auction method as the most suitable with the London -twice daily gold fix the second best. Yet later the report states that "the majority" of participants in the London gold market (the world's biggest) think the fix to be fair and that selling smaller amounts of gold more regularly would be "less disruptive" to the market. The WGC fully supports this argument and has made the same point
to the U.K. Treasury on numerous occasions. - Surprisingly, the NAO uses the p.m. fix, rather than the a.m. fix, as the comparison with the achieved price in the nine auctions staged so far. The p.m. fix takes place after the auction and is, therefore, influenced by its result. A better comparison would be with the a.m. fix. In two cases - July and September 2000 - the difference between the auction price and the a.m. fix was significant. In July 2000 the auction achieved $3.10 an ounce less than the a.m. fix, while in September the auction under-achieved the fix by $1.40 an ounce, an implied loss to the U.K. of $2.5m and $1.1m respectively. - The report implies that the auction method of sale is somehow more transparent than the twice-daily fix method, which really isn't the case. The Treasury does not reveal the names of bidders at the auction, whether successful or otherwise. The only transparent aspect to the government auctions is that it is announced in advance that 25 tonnes is on the block. The London fix is just as transparent, as its volumes are included in figures published by the London Bullion Market Association in its clearing figures. - It is somewhat odd of the NAO to compare the auction prices achieved with the London fix price from Monday, May 10, 1999. This conveniently neglects that fact that the gold price collapsed by $7.50 an ounce immediately after the announcement on Friday, May 7, 1999. Miss Fukuda went on to say that the report ignores the progressive market decline in gold trading activity, market participation and liquidity since the Washington Agreement and said that this decline is making it increasingly difficult for the market to absorb large quantities of gold - such as 25 tonnes - in one bite. This is especially true as small, regular sales from Switzerland are now blunting the market's appetite. She said that the Council had also noted that the Swiss National Bank, itself in the process of selling 1,300 tonnes, specifically rejected the auction method after examining the initial results of the U.K. auctions. The NAO report indicates that the Swiss sale, through the Bank for International Settlement s in Basle, is "proceeding smoothly in a way likely to minimize the impact on the gold market."
Editors Note:
The role of Britain's National Audit Office, which is totally independent of the government, is to certify the accounts of all government departments and a wide range of government bodies. It possesses statutory authority to report to the British Parliament on the economy and the efficiency and effectiveness on which the departments and other bodies have used their resources.
Black Blade: I think that most here know the answers to the questions. We also know the reason for the auctions and the method used.
DJ Russia Norilsk: Palladium Shipments Head For Japan
MOSCOW (Dow Jones)--Arctic metals giant RAO Norilsk Nickel (R.NNK) said Friday that it is already shipping palladium to Japanese customers under long-term contracts signed last year. Company spokesman Anatoly Komrakov said the contracts would ensure steady supplies. "We have a number of long-term agreements on exporting" to Japanese companies, he said. March palladium fell as much as $50 to $1,022 a troy ounce in New York trading Thursday on reports that palladium shipments wouldn't start until Jan. 15-20. At 1100 GMT, Norilsk Nickel shares were at $7.90, up from $7.70 at Thursday's close, but still near their 52-week low of $6.35. Norilsk Nickel is the world's leading nickel producer, with about a fifth of total production, and the number one palladium producer, with 60% of output. It has 40% of the world's platinum supply, making it the number two producer of that metal. In 1999 it alone contributed 2.6% of Russia's gross domestic product.
Black Blade: We'll see. Heard it all before. If any is shipped, then it will likely be a miniscule amount out of current production. Otherwise, I'll believe it when it happens.
j'Bear comments and then asks, "I thought you said flakes, not nuggets. A question; does most gold come in a white rock, and If one finds a white rock like that, without knowing more, is it worthwhile to examine it closely for gold? I recall a dyke that was way out from nowhere, and the friend/aquaintance with me was I think a geoligist. He turned a bit strange that evening, but to my knowledge, there was never a mine at that location."
====
Please understand that I am a self-taught goldfever addict and not a formerly trained Geologist! The sample of "FREE(-milling) GOLD" that I sent out to some of the "Leftbrain Enhanced Forum radicals" happened to be from an unpatented claim located in the most Northern portion of that place of Black Blades' Grasshoppers. The most prominent landmark in the area is called Quartz Hill and is a large monolith of the white quartz. -- Yes, THAT white quartz contained the "nuggets" that you received. HOWEVER, not all of that type of quartz contains value, AND MOST all such quartz "gold ores" do not have VISABLE gold. Other quartz types (such as rose quartz) may also contain gold. Quartz "Dikes" in Serpentine geostructures ARE items of interest for exploration. The sample that you received was from my hardrock mine, which has "high grade hot spots" along the strike, but I wear on a "Thai Gold four Baht" chain around my neck (size 18) my favorite placer nugget which contains gold with three different types of quartz imbedded in it, which came from a placer claim on a nearby stream. To be a gold prospector or miner is extremely hard work UNLESS you are VERY LUCKY! (Right ? -- YGM)
I consider myself VERY LUCKY to be associated with all those of this Forum. Thank you all for allowing me to take up a chair at the TableRound and partake of the adventure. Perhaps those more technically trained could share their knowledge with all.
Gandy <;-)
Nasal congestion affects most gold estimators to a degree, but it never is as wealth threatening as ear wax can be!
VARIANCE, indeed becomes the question, my friend. If it does exist on the high side then there was no need for derivatives issuance. Negate that proposition and all becomes as you say.
However, with a mild alcohol solution applied within the canal, we may hear the "drum beat" of a massive shortfall of estimated gold existence. Further in the distance comes the sounds of doctored physical stocks, a year or so ago, being tapped for delivery. Only a fall in dollar prices managed to
truncate such demand, yes? Week hands turned away so the strong could continue. Herein, begins the story of leverage paper displacing demand for what does not exist.
Ahhh! Truth is always stranger than fiction. (smile)
The Petroleum Industry Research Foundation Inc. (Pirinc), New York, has warned that government petroleum product rules have caused a compartmentalization that leaves local markets vulnerable to disruptions. Pirinc analyst Ron Gold presented a report at the Jan. 9 meeting of the National Research Council Transportation Research Board.
He said, "The problems and risks of 'boutique' fuels remain. Indeed, there are new challenges to the downstream that could aggravate risks, in particular, the new regulations for ultra-low sulfur diesel and the coming phaseout of methyl tertiary butyl ether. Unless carefully -- and flexibly -- managed, the result could be new domestic supply shortfalls and new limits on the industry's ability to shop world markets to overcome them." As examples, Gold cited the California and Chicago gasoline markets.
California's Air Resources Board (CARB) has its own standards for gasoline. The Chicago area uses reformulated blendstock for oxygenate blending (RBOB) with ethanol in a ratio of 90:10. "California has long been known for its unique gasoline specifications and tight refinery balances which together leave the market extremely sensitive to any
disruption in local supply. Accordingly, spot price differentials for Los Angeles CARB unleaded versus the Gulf Coast have been extremely volatile, ranging from near 0 to over 30 cents/gal over the past 2 years. "Last June, Chicago (and Milwaukee) looked like California as a spike in spot price of RBOB pushed the average monthly differential versus Gulf Coast reformulated from about 0 to 25 cents/gal. Refiners had great difficulty in meeting Phase II specifications for ethanol-based reformulated gasoline -- used almost exclusively in Chicago and Milwaukee. "The resulting supply shortfalls, although small (about 2-3%), resulted in sharp increases in prices to consumers, as would be expected when the product involved is a virtual necessity. "After the television cameras went away, and calls for investigations of 'gouging' died down, the specifications were quietly relaxed, helping to bring
supply shortfalls to an end," Gold said.
He said distillate is not immune either from regional market segmentation, but causes are different. He said in 1999 the monthly average differentials between the spot price of No. 2 oil in New York Harbor and the price on the Gulf Coast was less than 2 cents/gal. But in January last year, the differential averaged 13 cents/gal during a cold snap. Gold said this year regional distillate inventories remain very low, even allowing for the 2 million bbl in the newly created Northeast Heating Oil Reserve. "With pipelines full, the marginal sources of supply are imports and Waterborne shipments from the Gulf Coast. But international tanker rates are high; a result of the surge in Organization of Petroleum Exporting Countries production while domestic Jones Act tanker capacity is also limited. Thus some significant differential is likely to persist until it is clear heating season needs are met and shipments to the Northeast recede."
Black Blade: With a name like Gold, he can't be such a bad guy. However, it would appear that the Grasshoppers insist on scuttling the economy with such crazy requirements. Here is no uniform standard. This will just help bring the economy closer to collapse. Diversification with precious metals seems ever more prudent right about now.
This is from Gatnet Basque's book titled: GOLD PANNERS MANUAL. "As the gold cooled, it solidified into the form of these veins, sometimes in combination with other metals. These original veins are called lodes, and are the principal source of all gold. Gold is most commonly associated with milk-white quartz, which has been termed 'the home of gold'. It is frequently found in eruptive rocks and veins, intrusions and overflows in the metamorphic strata.
Several years ago I bought some from the Original Sixteen-
To-One Mine in California. I would imagine they are still selling samples.
Second Archive to the Gold Trail has now been created
http://www.usagold.com/goldtrail/Presented in a top-down format for easy printing and reading, you may take an interest in the two archives for FOA's Gold Trail.
"The Trail Head" has been in place for several months, representing the Gold Trail archives from Feb 2000 to June 2000.
"The Long and Winding Road" has now been completed, providing a very readable structure to the Gold Trail archives from June 2000 to the Present time.
From the Gold Trail link above, you will find easy access to these archives.
David GuyattI think that TG has confused the issue here.
I can also see no validity to FOA's assertion that no black market production could have existed before 1971. Indeed, as I have said before, author Paul Ferris, in his book IN THE CITY said that in 1951, only 17% of all the worlds gold production went through official channels.
Who really knows what quantities were leaking out of South Africa, the Soviet Union or Southeast Asia before that? Especially when we bear in mind that gold has been mined for six millennia, maybe longer.
Once we agree - as seems to be the present case/consensus according to the latest posts - that the official figures understate (absurdly so in my view) reality by a considerable margin then we are entering another world, a parallel world, where the rules differ and the process of counting stands apart from our experience and knowledge base.
We can call this parallel world the black market or use a similar appelation, but none do it full service. The description I am beginning to use more and more is "parallel world financial system."
Not only gold but a heap of paper move and are traded in this world, unseen and inscrutable. There are good reasons to suppose that this other world has a its own depth, velocity and grandeur that makes the "seen" world pale by comparison.
One of my considerations for holding silver along with gold is that it's much easier to part w/ silver for day to day transactions (if/when it comes to that). A silver dollar exchanged for a bottle of fine wine - no problem. If gold is to be given up, it must be for something of equal value - which is quite hard to come by i'd say.
I'm a simple man though. Not in a position to drop 300 k-rands to prove a point (big smile).
Great being part of this group. Grab your board - looks like the surf is up! Let's ride it out in style.
Though I am curious how you resolve the apparent conflict regarding the fact that the silver (or even paper!) dollar that you are not reluctant to spend on a bottle of wine could also as easily be spent on an equal value of gold...that is, equal value according to the market that day?
In making the decision to spend one item for another item, equivalent value is always sought by the parties on both sides of the transaction.
Could it be that the effect we are seeing is your perception of the long-term utility of the various items influences your eagerness or reluctance to spend it instead of spending another item of equal value at the current time? This is a very practical variation and application of Gresham's Law.
Such is the reason that many wise people around the world select gold as their form of savings.
Yes, I do believe it near impossible to get even an accurate estimate as to how much gold (or silver, for that matter) is "out there".
Even official gold holdings by CB's are very suspect...the leasing business along with political implications will nearly always mean that CB's tend to OVERSTATE their reserves.
The best we can hope to do is get a very rough estimate on above ground gold and silver...imo, the margin of error will be quite large.
Where we should be able to do somewhat better is in estimates of gold/silver mined, since larger, established companies provide most of the supply and their numbers are available. Also, demand is somewhat easier to track - although I think the margin of error here may be larger than many expect.
On another subject...I find the idea of Steve Forbes to allow money creation until gold hits $320+ somewhat amusing. If you are in the camp that today's price discovery system is BROKEN - mainly because of a vested interest to keep gold below $290, then Steve's challenge to Alan G. to pump even more money has to make one giggle (or cringe - take your pick!).
http://www.usagold.com/onlinestore/special.htmlMichael tells me they have essentially sprouted wings and are flying out the door. Act quickly to get yours...I was quite pleased to claim some for my very own.
I read it, and it scared me a little in a fundamental way. This man had designs on the Presidency, so it was insightful to read his ideas on this particular situation. But, correct me If I am wrong(as I very well may be), but Mr Forbes made his fortune selling magazines instead of giving financial advice, did he not? His, as represented in the aforementioned article, is strictly a Western View on the matter, as our Trail Guide would say, only viewing the half of the equation that suits him, and ultimately blaming failure on the whole. I wonder if he is holding any physical Gold?
Understand. My opinion as to the BEST uses for physical gold and silver to the individual are as follows (in order):
Gold
1. Wealth preservation!
2. Capital gains opportunity
3. System breakdown failsafe (small units)
(Number 3 here is shaky to me...would rather use silver).
Silver
1. System breakdown failsafe (small units)
2. Capital gains opportunity
I see silver as a lousy wealth preservation tool for the LONG run, mainly because storage is such an problem (large amounts are too bulky). Warren Buffet bought mainly for capital gains opportunity (although his purchase of nearly 130 million ounces makes me wonder if this isn't a wonderful idea for companies...instead of paying a dividend, why not lock up PM's for your shareholders? Really helps the book value where dividend payments do nothing here). Warren will sell, if he hasn't already, when the time is right...storage is a short term cost.
You also wax eloquently, my friend, thanks for coming to my aid! How much gold has been drained off and what is the balance is what I hear you saying {grinnin back}. We shall listen together as the gold market is brought back into equilibrium from being down the tubes! 'Ears to you, may your travels be GOLDEN! auspec{iality}
It's not just storage that makes silver a problem for wealth preservation vs. gold. Silver is much more common than gold. Now, I'm not talking about just above ground supplies...I'm talking of overall availability. IF silver were ever to find a dollar pricing of $20+ an ounce (5X today's "price")...the amount of mined silver would increase many, many fold. If, however, gold were to reach $1500 an ounce - yes, the amount mined would increase, but not nearly as much as such an increase in silver.
You see, silver is now mined mainly as a byproduct of lead and copper mining...those companies mining purely to find silver ARE NOT MAKING IT! Just look at Sunshine Mining, Hecla, etc.
At a sustained $20 an ounce, many more mines would open to mine silver as a primary product. Supply would explode -- I dare say we'd see much more than twice current production. Now, I do believe silver is undervalued in today's price discovery system, but I'm not sure we are at the point where any but the best primary silver mines (less than $15 an ounce) can ever hope to survive (at least in the foreseable future). This is all guessing, of course -- silver is notoriously difficult to gauge.
At $1500 gold, however, could we see twice as much gold mined? Maybe, maybe not...and the demand could EASILY handle twice today's supply if gold were to once again be seen as a wealth preserver/diversifier.
"Gold [is] the ultimate form of payment." A. Greenspan
Notice he said gold, not silver, palladium, or platinum. Why? Gold's wealth preservation characteristics. It is unique in that regard. I don't hear of Indian peasant women yearning for palladium - no matter how much rarer it is than gold.
Gold has a very strong and ancient affect on the human psyche...just look at a piece of silver or any PGM...then look at gold.
Thank you for the references to ORO's "black gold" posts. It would have taken me forever to find them.
ORO (02/22/00; 09:01:15MDT - Msg ID:25821)
ORO (02/21/00; 15:48:58MDT - Msg ID:25765)
ORO (11/06/00; 01:17:13MT - usagold.com msg#: 40664)
I don't really like the phrase "black gold". I would prefer to call it "black market gold" or "Marcos gold". I think "black gold" is used as a reference to oil in the theme song to "The Beverly Hillbillies"... isn't it?
Ho-Hum, another sloppy week in the gold markets. Business as usual, can I please have just 50 more? That will do it for my lifetime, likely!
On the other hand, it was anything but boring around the Forum. A years worth of normal learning condensed into 7 days, thanks to ALL. I received a personal sort of epiphany this week, appropriately in early January, that led to my post #45479. The interworkings and mechanisms of these various forces are not nearly as important as just SEEING who the players are and where they are aligned! This quelled a relentless quest to peer behind the curtain. It's not pretty back there and am not anxious for ANOTHER look. Still looking for any feedback as to what might be missing in these "lineups". Anyone?? Actually I forgot to list the Jr Senatorium from NY, couldn't figure out where to put her. Maybe a village of her own.
Walovka on vacation? Welcome Paul van Eeden as a poster as his time permits! David G, we're almost ready for you man! GATA getting ready for S. Africa, Shifty the aspiring poet, Randy showing off a bit with the creativity shtick {sp}, Black Blade prolific for us early in the AM, star appearance by Christian, Peter steady as a rock, HOF nomination for Mr G, Trail Guidance, and of course our gracious host. This is just for starters! We need to recruit some talent for this place!
See ya next week, same gold-time same gold-site!
Come and Get It! .... for all clients and subscribers (including those with trial offers)
http://member.usagold.com/commentaryreview.htmlThe January edition of News & Views is now available in .pdf format for our European friends and for our domestic clientele who want to get the jump on their mailman. (Hard copies should begin arriving shortly.)
If you've forgotten the online access process, you can get a "refresher course" at the Daily Market Report Page.
And for those whose trial access has expired, do not be shy about either becoming a subscriber, or best yet, by adding to your precious metal holdings through business relations with Centennial Precious Metals...the most customer-minded gold dealer you will find anywhere. (What other dealer strives to bring you all of this info to keep you informed?)
Date: Fri Oct 27 2000 19:13 Stair Maker ID#287337: ....... It is
my contention that to meet industial demand and an equal or
greater global coin demand, tripling or quadrupling mine
production would be required in a relatively short period of time.
Then there is the issue of the shorts having to return the silver
they borrowed. That I think guarrentees the situation. Mining
companies might be trying to cut costs to stay in production at
current prices, but now you must remember 88% of mine production
is a free by product of basemetal mining. Production increases
there will just undermine metal prices on the metals that pay the
bills. The rest of silver mining is from silver mines and these
days they would have to be higrade silver mines to make things
pay. Those mines that are not producing are either worked out or
not profitable at market prices for silver. So a massive increment
in production will require massive investment and masssive profits
for a while to justify the whole thing. Otherwise what is the
point? Charity? I think not. If it is to be done it must be for
profit and one that justifies the legal, environmental, labour and
other red tape and hassles. It will take time to get things up and
running and time is running out. The market is pricing the stuff
as if it was as common as table salt. In other words no end of it.
This just is not credible in my opinion. The high triple or
quadruple digit average price estimate would result when they have
to buy out people like me who are trying to get rich on a once in
a life time opportunity. I believe that as the quantity approaches
zero the price must approach infinity.....
From: "David Morgan" Subject: Re: a few kitco posts you might have missed (silver)
Date: Sat, 21 Oct 2000 07:38:24 PDT
.....
> Fleckenstein is on the board of PAAS and should know something about
> the silver market. One might wonder why someone as intelligent as
> Buffet would sell at a loss. But perhaps it was a government purchase
> through Buffet all along. Just a dark thought. And of course Soros'
> Apex San Cristobal mine in Bolvia comes on stream in 2001 with its
> vast silver resources. Shouldn't it go a long way in covering the
> monthly deficit in silver supply? Maybe I'm too cynical about this.
.....
It pays to be cynical at times. As you know by now I am an analyst
and get to join many mining companies on their respective
conference calls. Here, the answer is No. In fact on the last PAAS
conference call I asked Ross Beatty about Dukat the largest silver
mine possibly ever! It would only add about 25M ounces anually.
Helping about 2 months of the deficit. DM
http://www.silver-investor.com/
What to call it?Marcos' gold is too simple because Black Gold encompasses much more than just Marcos. David G's use of the terms "parallel world financial system" naturally leads to the term "parallel gold" which is quite descriptive. Markets are not actually "parallel", however, when there is large cross-over from the black market into the visible markets. Black market gold rings pretty true also. Wish ORO would weigh in here a bit as his "parallel world" and "parallel gold" has been a huge attention getter. Whatever it is called, this black market gold needs to become common knowledge, so the VARIANCE can be pinned down. For example, all of Frank Veneroso's work was done under the assumption of accurate figures for above ground gold supply. IF this initial assumption is not correct, then all of his end results are suspect one way or the other. This is simple logic/analysis. It's a brave new world if you dare look and investigate. There are folks on this site that KNOW just about anything we could ask them. They, on the other hand, have a need to be discreet for obvious reasons. If the questions are asked often enough and persistently enough and in the right form, the answers will come eventually. If you ask it - they will come! Or maybe the cabal says....."You asked for it"! Whatever. Thanks RossL
First, if Mr. van Eeden's figures from the following are correct - - - -
"The physical gold market is less than 2% of the size of the
derivatives market. The annual supply deficit is only about 0.1%
of the total market and central bank sales, which everyone is
blaming for the demise of the gold price, are only 0.12% of the
gold market*." -Paul van Eeden, The Meaning of Derivatives:
Futures and Options [link in header]
- - - - then we can put a very rough (since there must be _some_ connection between paper-gold and physical gold, and full delivery won't be called-for yet) figure on what the official POG reflects. That rough figure would start at the price of a derivative based on 98% promise to deliver and 2% actual physical gold. The seats are greatly over-booked, but most customers haven't started to show up at the gate.
Yet.
Second: And then there's Eddy George's comment from Reginald Howe's lawsuit - - - so, if TPTB are, as Mr. George suggests, determined (and able) to keep the price low, then the official POG means very little, long term, about the price of physical gold at all.
Somewhat as Christian suggests, perhaps.
Keep that in mind and don't even pay the official POG any more attention than you would to any other mirage - - - unless you intend to sell (or buy) soon. Or own International Paper stock (that supply the raw materials to write the derivatives on)!
The bear case is that because silver is a by-product of the
production of other metals, it is produced without regard to price,
dumping unnecessary supplies on the market.
Silver definitely is produced as a by-product. In fact, over 75% of
total silver mine production comes as a by-product to primary
production, of copper, gold, lead and zinc. The bears are also right
in asserting that this brings silver onto the market without regard
to silver prices. A copper producer, for instance, is more concerned
about copper prices, than silver prices, and will make mining
decisions on the current, or projected price of copper, not silver.
This, of course, depends upon the composition of the ore, and is not
at all unusual or specific to silver. Geology is geology. Most metal
deposits are poly-metallic deposits, so by-product production is a
simple fact of mining.
It's true that 75% of silver coming as a byproduct is a high
percentage. But here's what the bears are missing. Yes, more silver
will come to market at a time of low silver prices but higher silver
prices will not increase silver production for 75% of the silver.
What's negative about a low silver price becomes an extreme positive,
when the silver shortage becomes evident. In fact, this is probably
the most important bullish aspect to the supply side of the silver
equation. Please think this through. When the price of a mineral
jumps, producers don't necessarily rush to bring new production on
stream.
A copper producer isn't going to rush out and open new copper mines,
to get at the by-product silver. That just won't happen. Silver
by-product production is price-inelastic when silver prices are low,
and is price-inelastic when prices are high. That's what the term,
price-inelastic, means.
In silver mines where silver is the primary product, bringing on new
production means years of construction and significant dollar
commitments. There are very few existing silver producers who would
bet the ranch on opening expensive new mines. They'd be too busy
thanking the heavens for the price relief after such a long drought.
One large group of miners can be categorically excluded from the
opening of new mines because of a silver price rise. These are the
miners already heavily hedged, or short silver now. By virtue of
having locked in low silver prices, in some cases for years to come,
they will be too busy trying to figure out where they went wrong, and
dealing with adverse financial and public relations problems. They
won't be thinking about undertaking serious new financial
obligations. In fact, in a sharp price rally their hedging and
shorting may result in such negative consequences that production
will be taken off the market due to insolvencies. Remember, we have
never experienced a bull market in silver with such a large and
pervasive short position.
I think silver is an excellent speculative play for a very explosive move higher. I don't think, however, that the majority of the gains are sustainable. There are several major companies (Silver Standard Resources [SSRI], Apex Silver [SIL], etc.) just waiting for the price explosion so they can go into production...they have been laying the groundwork for several years. Yes, it will take some time to bring on new production, but not as long as some think. New silver will then hit the market and much (but not all?!) of the gains will probably be lost. Silver moves are historically fast, explosive - but not sustainable.
http://www.bookmarkusa.com/goldweekly.jpgToday was option expiration on COMEX. Normally I would expect expect higher prices next week, but BOE auction is coming the week after...we'll see.
Precious Metals Review: Silver up 6.2c after 2-week high
12-Jan-2001 18:55:27
By Deborah Kinirons, BridgeNews
New York--Jan. 12--COMEX Mar silver futures settled up 6.2 cents, or 1.35%,
at $4.655 per ounce after climbing to a two-week high of $4.675 in Friday's
shortened session. Participants said a technical breakout occurred as the trade
sought buy-stops. COMEX Feb gold, meanwhile, settled down 20 cents at
$264.6 per ounce, after trading within Thursday's range.
* * *
The trade appeared to be looking for buy-stops at $4.680-4.700, a trader
said.
The move was a "technical breakout above the $4.610 to $4.620 level," said
David Meger, senior metals analyst, Alaron Trading. "The market was looking to
achieve levels above $4.615 to gather stops above the Jan. 5 high," he said.
Meger termed the close positive, but is taking a wait and see attitude to
see whether silver can build upon its gains.
Mar silver has been quietly drifting lower since pushing below $5.0 in
mid-November. The market appears to have found support at the $4.535-4.540
level, which it held last week.
"It's been due for a recovery all month, after languishing down in the
$4.50's for a couple of weeks," said Marshall Steeves, an analyst at Refco.
Steeves said that economic data Friday was a little more encouraging. "That
helped silver a little bit in terms of its industrial component," Steeves said.
U.S. December retail sales rose 0.1%, and for all of 2000 retail sales were up
7.9%. Steeves also mentioned the producer price index, which rose 0.3% in
December. (Story .5970)
For the week, silver was up 5.5c.
Gold, meanwhile, attempted to move lower Friday, one trader noted, but held
the downside 10c above Thursday's low. For the week, gold fell $4.4.
COMEX and NYMEX will be closed Monday for Martin Luther King Day.
SETTLEMENT PRICES
--Feb gold (GCG1) at $264.6, dn 20c; RANGE: $264.0-265.3
--Mar silver (SIH1) at $4.655, up 6.2c; RANGE: $4.590-4.675
--Apr platinum (PLJ1) at $635.1, up $7.1; RANGE: $632.0-634.0
--Mar palladium (PAH1) at $1,050.80, up $5.55; RANGE: $1,041-1,058
SPOT PRECIOUS METALS PRICES:
New York 1245 ET London 1225 GMT Tokyo 0715 GMT
Gold(KRCGL) 263.75-264.75 263.50-264.50 264.30-264.55
Silver(KRCSL) 4.61-4.65 4.56-4.60 4.56-4.57
Platinum(KRCPL) 628.50-638.50 628.00-638.00 630.00-640.00
Palladium(KRCPA) 1,045.00-1,085.00 1,040.00-1,090.00 1,040.00-1,090.00 End
From your post Pandagold (1/11/2001; 14:10:19MT - usagold.com msg#: 45503)
Silver Collector; Ted Butler and silver
I have, at least two published pamphlets which claim exactly the same as TB ie., 'that silver is the best risk reward bla bla.......
I almost went for it - THAT WAS FOUR YEARS AGO.
He may be 'fundamentally' right, but there are people, unfortunately, that can spook fundamentals - at least for an awful long time.
---------------------------------------------------------
You are correct and I have read upteen pamphlets on gold.
Just a reminder for any who might be interested that Robert Kleinschmidt will be a guest on CNBC in about one half hour at 7:30. He is the pres of the Tocqueville Fund which is divided into various mutual funds. One of these is the gold fund headed up by John Hathaway. Hathaway is not a supporter of a return to the gold standard or a believer in the GATA conspiracy theory but he is an intelligent investor who believes there are good opportunities for gold. Kleinschmidt must have quite a bit more knowledge concerning gold than the average fund managers who, when asked about silver or gold, usually go totally blank and have been known to reply, " I'm not familar with gold, are they a new fiberoptics company?"
I was a lurker for over a year and a half until I started to post recently.
I probably retire to lurker-ville again soon. I did not understand FOA's Trail synopsis the other day in reference to silver.
If one examines historical charts of silver and gold they do tend to trend together. The difference with silver as with PGM's is they are consumed (compared with gold). All gold ever mined still resides above ground (negligible use).
Witness the PGM story in the last year or more, fundamental supply/demand issues will break silver loose whereas with gold I am not so sure.
I do hold gold for wealth preservation but as a ratio I hold approximately 6-1, silver to gold. I do not slam gold as I believe, IMHO, FOA did to silver the other day.
Thanks AEL for your comments today and thanks for leaving 'lurker-ville' to defend silver.
HOLTZMAN-THE CONTRARIAN VIEW OF A CONTRARY COLONIST
Global Conspiracy and The New World Order
Taking your challenge let's indeed think this thing true.
Holtzman:
I continue to be disturbed by the trend towards conspiracy theories at forums such as ours.
Let us for a moment consider the mother of all conspiracy theories: one world government. The mere mention of that phrase seems to send shivers up some people's backs, but honestly now why should it? I find the best way to appraise a situation is to look back into history for situations which at least somewhat resembled it, then examine
what became of those situations.
Perplexed:
Having examined events occurring in 1066 through your expaination, let's advance the calendar to the late 1930s
and early 1940s. It seems that I recall a man by the name of Chamberlain crossing the channel to talk with a man by the name of Adolph Hitler in order to examine first hand, the rumors of a conspiracy between said Hitler and Benito Mussolini, the " leader" of another local country, and just how they effected the welfare of the citizens of the United
Kingdom.
Chamberlain returned with the very good news that Hitler had assured him that the supposed conspiracy offered no threat to Great Britain. As the result of looking at the situation through jaundiced eyes the seriousness of the situtation was not reflected in the evaluation of the conspiracy, contingency plans were not realistically formulated, Chamberlain lost his job as Prime Minister, and Churchill was stuck with some very interesting options. # 1 Either persuade the colonies to extricate your collective asses from the proverbial sling, or # 2 Prepare for a change in the official language by offering mandatory classes in German.
Conclusion: If it is better to be one year early into the gold market than one day late, is it not also better to treat all potential threats with diligence, rather than to assume that onlythe paranoid entertain conspiracy theories.
I guess some people are slow learners.
It was said at the time that the sun never set on the British Empire. They ruled the seas and controlled a very large percentage of the world trade. England had, for all practical purposes, established world government. In fact, not many years previously, they possessed the might to force India to manufacture opium and China to accept it in trade.
Although king of the roost, and rolling in wealth, the steadily expanding prison population,had reached the point that ships were required to be anchored in the Thames to house the over flow. Composed primarily of commoners, that when faced with the options "law"favoring the aristocracy had imposed upon them, many had chosen to steal rather than starve, they were now a major problem. Finally the decision was reached. Rather than shock the
sensibilities of the Nobles by administering a quick and merciful death in England, they would be shipped (transporting would dignify a process so brutal and barbaric that just reading about it made me shudder) to another continent; those who survived would become the population of Australia.
Many citizens who had not yet been classified as criminals, developed a strong urge to depart the United Kingdom, and, because feeding them was becoming a problem, some were not only allowed but assisted in their migration, however they were still on the kings leash, and still considered subjects of the World Government of its time.
Holtzman:
Merit and the respect of the nobles counted considerably, and it was perfectly possible that the six earls might decide to place one of their own number on the throne if they deemed he would be the better man for the job. Of course, the opinion of the commoners was unimportant.
If this sounds vaguely familiar right now, it is perhaps because you just witnessed much the same transfer of power in the United States, where the votes of the earldoms (states)and the nobles (election officials and judges) held sway rather than the votes of the commoners.
Perplexed:
Now that we have probed an example of a power struggle American style, lets consider an example of a power struggle English style.
General location: The British Isles, specifically a muddy battle field at a place known as Runnymead. The time is 1215 AD. The setting finds the King surrounded by a group of the Nobles you speak so highly of, discussing a change in the way things are done. We see the King readily shaking his head in the affirmative; however, as our perspective on the proceedings changes, we discover that the King has a sword at his throat, and the "Nobles" have just made him and offer that he can't refuse. Bad analogy? No more than yours.
Holtzman
Do any of you care how the Secretary General of the United Nations is elected? We've had a President of Earth for nigh on half a century now and most Earthlings haven't even
noticed. The high king of England seldom if ever came into a commoner's house, either to benefit him or to endanger him. How many Americans have had Bill Clinton personally invade their homes? For every televised home invasion by federal stormtroopers, there are tens of thousands of interventions by local constabularies.
Perplexed:
You are right, most of us haven't noticed. A few years ago most of our insane asylums counted at least one Napoleon in residence, however, because title without power is in no
way a threat us or our way of life, why worry. We do worry about the effort now under way to bequeath this "world president" as you refer to him, the power of sovereignty at
the expense of the personal sovereignty of millions of citizens of this nation. Oh, I'm sorry! Because that concept isn't applicable to citizens of the United Kingdom, the term "personal sovereignty" might not be familiar to you.
And you are right, our ancestors were never "treated" to the presence of their "sovereign" however they were very familiar with his policies through actions of his agents, both those shipped from overseas, and those of domestic origin, willing to enforce the edics of the master at the expense of their fellow "subjects."
And you again are right about Clinton, few of us have been subjected to the indignation of his presence in our home. And, indeed, few of us have been subjected to the result of one of Clintons plans, as experienced by our fellows in Waco, Texas, and witnessed worldwide via television.
"But" pun intended, because the pain is less, many of us would have been happy to have traded him for a regular hemmroid.
Holtzman:
But that's the key: almost all invading officials are local to the invaded. The bobby banging on your door sleeps not twenty miles from your house, so he'd best bear that in mind when dealing with you. As rare as a federal intervention is, realize how rare a planetary one is. Kosovo needed a planetary intervention. Florida only needed a federal one, and that happened only because the gridlock in that one state was hindering the needs of the other states. I daresay that if a similar fiasco were to occur in one state's governor's race, thefederal level would feel no compulsion to intervene.
Perplexed
Clinton has had a goal of increasing the total local police presence by 100,000 each year paid for by the federal government, and as you are aware, even in England, that for which the federal government pays, the federal government controls. How?
Every year a large number of the leaders of our local constabularies, attend schools in Quantico Virginia to be indoctrinated in federal procedures. They then return, put from one to five stars on their collars, pass their indoctrination in the latest "swat team" practices on to six of the total aggregate of ten comprising their force, and then search for situations in which these practices may be put to use.
The "local bobby" sleeping perhaps twenty miles away, has thus been instructed by his "general" to wear black commando type clothing and to cover his face with a stocking
mask, just as criminals have doing for years, and for the same reasons.
Holtzman
It is an unfortunate side-effect of human nature that many if not most people allow themselves to fall into overblown we-they mindsets, world views wherein dark forces are
massing on the horizon, bent on doing harm specifically to us. The creeping terror which naturally results from such self-fulfilling world views is perhaps the prime motivator
behind individual adults' acquisition of physical gold and silver (and individual children's acquisition of stuffed animals).
Being aware of that tendency among the masses, and steeling yourself to avoid falling intothe same panic, is the key to knowing when to buy gold, when to hold gold, and when to
sell gold.
Perplexed
"Is it live or is it Memorex?" This question has been asked on television for many years, and has returned millions of dollars to the company paying for the air time. Let's ask a
similar question: "Under what conditions is it diligence, and at what time is it replaced with paranoia?"
Are the dark clouds real and a threat, or just regular rain clouds. Having been raised on the plains of Texas, and witnessing the aftermath of tornadoes, few of us grumbled as
kids for being required to spend from a few hours to all night in a storm cellar because our parents couldn't tell the difference. I imagine the same conclusion is appropriate to the citizens of London in the early forties.
In either case, the result of being a slow study could be the finding of yourself buried in debris. So while a wrong decision on when, or even if, to buy gold might cost you a few phenning, a wrong decision in the assessment of an air raid siren or storm clouds could be considerably more costly.
Holtzman
Getting ALL the gold
--------------
There's a recurring theme among aficionados of conspiracy theories that 'They' are out to get all the gold away from 'Us' and, once 'They' have it all, 'We' will be at their mercy.
But think that scenario through for a moment. Let's say that NWO, Inc., somehow manages to buy, beg, borrow, or steal every ounce of aboveground gold in the world, down to the very last flake. Let us further say that NWO also takes control of (or at least has the power to destroy) every gold mine on the planet. I gather that's what's anticipated
by the conspiracy fans.
In the aftermath of such a complete acquisition, I find myself asking the rather simple question, 'So what?'
Perplexed
We have obviously drawn opposing conclusions from the same correspondence. My impression is more toward the indignation commensurate with the realization that not only is the entity responsible for maintaining a level playing field, implicitly, through lack of prosecution, condoning practices that should result in prison time, but is also changing the rules to accommodate those practices. What have I missed?
I will allow you your imaginary scenario, if you will allow me a touch of reality.
Assuming the NWO inc. possessed the capability of determining the location all gold, down to its last flake, the ability to extract it from every application which has ever existed, including taking it from my teeth while I sleep and storing it in a hugh cube would be a given.
To accept your conclusion that the action would render it worthless is asking too much.
For this conclusion to be valid, not only would all the gold be required to become inaccessible, but this power would also be required to totally erase every memory and every record of gold which has ever existed. At that point because no one on planet earth was aware of any current or potential application or even of its existence, that hugh block of gold would be worthless only to the NWO Inc.
To achieve anything less than a totally clean slate, given human nature, destroys the conclusion. How
Rather than worthless, because it would place gold in the same category, as The Arch of the Covenant, The Holy Grail, The Golden Fleece (Whoops, where did that come from?)
and other artifacts which have been merely rumored to exist, it would become priceless.
As far as discovering value, The Mona Lisa has never been traded and its price determined on a daily basis by a market
dedicated strictly to it, but that does not render it worthless.
Solons mentioning to Plato of a sunken continent which supposedly existed somewhere between what is now known as America and the Pillars of Hercules, touched off a search
still active today. If someone unearths a relic which confirms its existence, the relic,worthless one minute because its was unknown, becomes priceless upon its discovery.
And finally another analogy. The King of England until 1776 was in possession of something even more valuable than gold.. The King enjoyed and controlled that most valuable and desirable or assets, an asset that only he could enjoy in full measure.
Because of its rarity and desirability even small portions became very valuable to those limited few who had tasted it.
Others, the commoners, because they had been brained
washed to believe that it was a gift of God with very limited application and thus unatainability, it,like the large block of Gold acquired by the proverbial NWO inc. was worthless.
However, because the concept of total control was not a total secret, it was sought by others willing to kill to attain it, thus it was necessary to award limited portions, determined by their value to the cause of keeping the King alive and in control, to other individuals.
Because it not only paid very well, it was a very great honor to be able to say "I act in the name of the King" he thus experienced no difficulty in finding men who would sell their souls and act without question against other human beings.
Because they considered themselves far above the average person, the concept of fellow citizen did not even
register in their minds when thinking of commoners.
In this manner he purchased enough of the loyalty of enough of those willing to aid his goal, and finally, by appealing to patriotism and pride in King and Country, attributes
which had been previously instilled through indoctrination, and promotion he was successful in withstanding the challenges of those seeking to acquire that which he alone
possessed, total sovereignty.
The migration to America released this most valuable of assets, and like water behind a dam, once released it became impossible to control, and once tasted the flavor is never
forgotten. Once the habit of kneeling, kissing rings, asses and "royal" ground is broken, for most people death becomes preferable.
RATHER THAN WORTHLESS THE VALUE OF FREEDOM BECAME PRICELESS, AND RATHER THAN BUILD FENCES TO KEEP PEOPLE IN, WHEN BUILT, IT WAS TO KEEP THEM OUT.
While the sheriff of the Earldom of Nottingham is busy confiscating weapons of self defense and prosecuting those with the audacity to harm criminals protected by the
Queens Government. The sheriff of the "Earldom" of Snohomish County Washington is REQUIRED by Constitution, (Opps, sorry Holzman I forgot, you don't have one of those
either, if you require an explanation it will be happy to oblige) TO AUTHORIZE ANY CITIZEN of the "Earldom" opps, now you have me doing it, make that County, for which he can find no reason to deny, TO CARRY A CONCEALED PISTOL. (I applied for my authorization on Monday and it arrived in Wednesdays mail.) High-powered rifles, equipped with high
powered scopes capable of driving tacks at 700 yd. are routinly seen in racks through the back windows of pickups.
Perhaps this seems bazaar to you, but it works for me.
So while your point of view gained a place in the HOF, in my opinion
YOUR HOUND DOESN�T HUNT AND THE FOX JUST RAN UNDER A FENCE TO HIGH FOR YOUR HORSE TO CLEAR.
TG suggests that because, although Brazil has gone through a new paper currency about once every two years and still comes back with _another_ paper currency, that we'll never have a gold currency.
Well I partially agree. We'll never have a NATIONALLY SPONSORED gold currency, simply because that's way too much power and profit to expect the government-banking establishment to give up. No matter that it's the most just, most practical and simplist for international trade and protects the common man, A gold-limited currency would make much of the thievery these cliques engage in difficult or impossible. It is the fact that gold would protect the common man from these cliques that assure _they_ will not reinstitute such a currency.
However, because it is the easiest most rational medium for international trade, which will be increasing as time goes by and the internet grows:
"As the global economy increasingly becomes a reality with
improved communications throughout the world, individuals in
different countries will have less tolerance for the
discretionary actions of fallible central bankers that undermine
the value of money. Producers and consumers will want to deal
directly with each other. A gold standard provides the common
denominator for conducting business across national boundaries --
a sort of monetary Esperanto. National currencies function as
dialects of the same root language, gold-backed money. _-Judy
Shelton, Money Meltdown (New York: The Free Press 1994), p. 259_"
So, TG's most likely correct; no central bank-government cartel will institute a gold standard - - - that will be up to other organizations.
Things will be greatly facilitated when on-line prices begin to be posted in grams of gold as well as one national-brand of currency or another.
I would like to nominate Perplexed's msg# 44583 to the Hall of Fame. Well done, Sir.
First and foremost, it was a well thought out response to Sir Holtzman's post and it reflects a perspective regarding the sovereignty and dignity of the individual with the tempered fire of a Patriot. A refreshing quality, in my book.
"The migration to America released this most valuable of assets, and like water behind a dam, once released it became impossible to control, and once tasted the flavor is never forgotten. Once the habit of kneeling, kissing rings, asses and "royal" ground is broken, for most people death becomes preferable."
But also, because Perplexed articulates a very practical perspective regarding the issues that confront us all daily as we try to discern the "signs" on the horizon.
"Are the dark clouds real and a threat, or just regular rain clouds. Having been raised on the plains of Texas, and witnessing the aftermath of tornadoes, few of us grumbled as kids for being required to spend from a few hours to all night in a storm cellar because our parents couldn't tell the difference. I imagine the same conclusion is appropriate to the citizens of London in the early forties.
In either case, the result of being a slow study could be the finding of yourself buried in debris. SO WHILE A WRONG DECISION ON WHEN, OR EVEN IF, TO BUY GOLD MIGHT COST YOU A FEW PHENNING, A WRONG DECISION IN THE ASSESSMENT OF AN AIR RAID SIREN OR STORM CLOUDS COULD BE CONSIDERABLY MORE COSTLY." [My emphasis.]
With all that has been said on the subject, I think one would have to dredge the archives to find as succinct a statement.
Hi all,
I've been following the Gold hikes lately and listening to everyones camp side fire conversations..
as a newcomer, why would the 2nd richest man in the world buy 130 million ounces of Silver and not a few million ounces of Gold or Platinum???
If hes so smart(a net worth of close to 50 Billion) why is he buying Silver?
Does Mr Buffet no something we dont know?
just curious about your thoughts..
As FOA said, why buy ~Poor-mans~ when you can buy the real thing..at least the 1/10 oz for around $28-$30.
Didnt we all hike by a good Precious metal cave somewhere around here...:+)
thanks for listening..
cris
Perplexed is as eloquent in his statement as Mr. Holtzman was in his. I strongly concur with Java Man's judgment that this post merits HOF recognition.
I couldn't agree more with Java Man when he states "First and foremost, it was a well thought out response to Sir Holtzman's post and it reflects a perspective regarding the sovereignty and dignity of the individual with the tempered fire of a Patriot. A refreshing quality, in my book."
Lost another 20 gold coins in the options market again today
Well son of a gun, ol be darn, I lost another 5000 today with the expiration of feb 270 calls. Now up to a totall of 30,000 in the last year and half. New strategy... I will now buy DOW puts, Crude calls, and Euro calls, and if profit is to be had, it all goes to gold coins. This leveraged paper pruduct is doomed.
I see very clearly now that this leveraged paper gold market is being used to buy physical gold at artificially created low prices. Smart get GOLD at the cheapest prices you possibly can by depresing the price with leveraged futures contracts basically. Sell paper to get cheap physical, easy game. USE paper fiat junk in order to obtain the real deal. Gold is always the goal, obtain it at all costs, obviously no different this time. Lie, cheat people of their gold held in their cenral banks. I really hope I can buy 4 gold coins with a 1000 dollars to come, that is cheap. I wonder if I should even help my cause and sell paper gold in the process? I will jump on their wagon with both feet. Its getting very easy to believe the Trail Guide scenario now, due to the fact it is happening.
NOT to be confuzzed with the "Texas Tea" stuff that some also call Black Gold, BUT in line with the underthecovers
type stuff. --- WELL, way back in the rock and roll era, followed by the Free Love era, SOMEONE TOLD ME, { <;-) } that in the Northern portion of the Grasshopper State, where the small local miners made a living from mining either hardrock or placer, the folks that GREW the product also called something GOLD, would buy, in the field, the placer golddust and free milling hardrock materials at SPOT Price with green dead president's pictures (even though it was only about 0.93 purity at the BEST)!! Seems as there was a Black Gold period way back then too. OF course those buyers were OFFICIAL Tax consultants and advised the miners not to claim the earnings from their efforts ! OK -- enough wild stories that no one would believe anyway!
<;-)
Has it been said somewhere about a mark of intelligence and rationality being the ability to change one's mind? -- Or am I embarking on a self deprecating proof that my viewpoints are composed of mental silly-putty.
I find myself in the position of seconding the nomination of a post that is a brilliant and accurate counterpoint to a post that I myself nominated. Paradox? No, introspection. How easy it is to skip over the weak points of something that is superbly written and contains ample truth. Or maybe I have a mercurial IQ, rising and falling with the emotional temperature of the moment.
The clue to the dilemma lies in viewing conspiracy theories I think. There are not just black or white opposing forces of paranoia versus naivete. Perplexed has pointed out the multi-hued middle ground analogous to "Speak softly, but carry a big stick." And, how did I miss that sovereignty issue? Oh well, maybe Holtzman will ship us some tea.
I believe I shall now read more slowly and "engage brain before opening mouth" via submit button. -- Well done, Perplexed, I also second journeyman's nominationView
Yesterday's Discussion.
You should not be too concerned with Steve Forbes. He inherited his wealth from his father Malcolm Forbes. He has advocated a return to the gold standard for many years. He has said on occasion that gold is undervalued. I do not know how he arrived at the values of $300 to $350 per ounce, or if that was to make a point
There has been much talk of the major silver holders, producers, and billionaires that are drawn to silver like moths to a flame. Here's my take:
Silver - All: I'm not aware that Warren Buffet sold any silver. His philosophy has always been to by at a deep discount and hold forever if necessary. When asked how long one should hold their investments, he replied "forever." Therefore, it is just as likely that Warren Buffett still retains a sizable position in silver.
George and Paul Soros are principals in Apex Silver (SIL). Apex Silver's mining projects are just as likely to make profits from base metals such as copper, lead and zinc than from silver. In Bolivia, silver is abundant, but not the primary source of income once the San Cristobol project comes on line. The latest feasability study has the project containing approximately 470 million ounces of silver, 8.8 billion pounds of zinc and 3.1 billion pounds of lead. The san Cristobol mine is one of the world's largest zinc deposits. Other Bolivian projects such as the Cobrizos project has silver-copper, the Rincon del Tigre project has platinum�palladium. In Mexico, the San Luis del Cordero, Zacatecas and Platosa projects are silver-zinc-lead, San Juan del Cordero is silver-zinc-copper, and Aguila is gold-silver. In Peru, The Aguila project is gold-silver-lead, Aventura III and and Jehuamarca projects are gold-silver. In Kyrgyzstan. The Jamgyr project is gold. Apex Silver (SIL) is a much more likely to become a very diversified mining company than the name implies. They have some good people working with them.
Bill Gates took a 10.3% position in Pan American Silver (PAAS) through his holding company. The Dukat project has had some difficulties with the Russians (doesn't everyone?). First they sell PAAS the mining rights, and then they auction off the mining facilities to a Russian company. I would be surprised if Dukat actually gets off the ground. PAAS is more likely to make a profit off of the Quiruvilca mine in Peru or la Colorada mine in Mexico before Dukat. Other than that, they have several other targets in Bolivia and Mexico.
Attn: Holtzman; Perplexed; Peter AsherFor as long as I have been reading this Forum, I have been in
awe of Sir Holtzman's eloquent and always interesting posts
and essays. He, perhaps better than anyone else in this forum
has a command of the Queen's English and historical insights
and a unique ability to put them both together into prose that
is second to none. I look forward to anything and everything
that he so graciously provides to us for our enlightenment.
And too, Sir Perplexed has shown us his own clearly unique
ability to offer in gentlemanly manner, a mild and well thought
rebuttal from the perspective of an American patriot. There's
nothing wrong with that either.
We, of this RoundTable, are surely The Richer, having both of
these excelleant writers in our midst.
And so, Sir Peter Asher, it is not surprising to me whatsoever,
that your keen intellect would (correctly) lead you to nominate
and second both of them to our Hall of Fame.
It is within such diversity, indulgence, and appreciation that
we all thrive in this Forum. Let it continue.!.
http://www.piwpubs.com/gasprice.shtmlMostly down, though slightly higher in the land of the Grasshoppers. Oil is higher $30.05/bbl ahead of the January 17th OPEC meeting. The cut in production is expected to be between 1.5 and 2 million bbl/day. The real kicker is that Iraq may disrupt supply by withholding as much oil and that would put a real crunch on world oil supply.
The U.S. is weathering a barrage of energy-related jolts, each of which is contributing to the increasingly uncertain outlook. While oil prices remain high, there is little doubt now that short-term supplies are adequate to meet demand. As a result, prices have fallen for gasoline and heating oil. Natural gas, however, which accounted for 23% of domestic energy use in 1999, is a completely different story.
Uncertainty surrounding the capacity of natural gas inventories to meet demand is pushing prices through the roof. In the first two weeks of January 2001, the price of gas at the benchmark Henry Hub rose to $10.40 from just over $2.00 a year ago. Household heating bills are doubling and electricity prices are are under tremendous upward pressure in some parts of the country as electricity is increasingly generated from natural gas.
The runup in natural gas prices is driven by fundamentals. National natural gas inventories are now almost 30% below year-ago levels, and there is no hope of quickly rebuilding supplies. Poor resource development was masked for several years by warm winter weather. In 1998, there were 12% fewer heating degree days than the long-run average, 1999 was lower by 8%. Even the first half of 2000 was unusually warm. Natural gas supplies ballooned reaching a high in 1998; at the same time, rig counts plummeted. Now though, stronger demand during this past summer due to higher electricity usage and a return to cold winter weather is exposing inadequate production capability.
There is no reason to believe that the natural gas prices that prevailed over the last decade will return. Moreover, there is a growing consensus that natural gas prices will be two or three times higher than they have been historically for the next few years. The reasons for this view are due to the inflexibility of supply. It takes about one year to fully develop natural gas resources, and a couple of years will be required to rebuild inventories to pre-crisis levels.
The certainty of continued underlying demand growth for natural gas despite higher prices is tied directly to electricity. Almost all planned electricity plant additions in the U.S. will be powered by natural gas. Environmental regulation has made the construction of other plant types extremely costly. Without such regulation, coal would take preeminence in electricity generation. Furthermore, natural gas heats about 50% of all homes in the U.S., and if winter weather returns to its historical average number of heating degree-days, a considerable increase in natural gas use will result.
The outlook is undeniably gloomy. Consumers will feel the pinch for the next two years, and there is little that can be done to improve the situation in the nearterm. Rig counts have already rebounded in a rush to take advantage of the higher prices. There were only 466 active rigs searching for natural gas in January 1999, 606 by January 2000, and there are now 862 rigs searching currently. It is now a waiting game until these new rigs are able to replenish supplies. In the mean time, any government intervention to cap prices will only serve to exacerbate the situation by encouraging higher use and less production.
Black Blade: From a site called "The Dismal Scientist" ya gotta take notice. Much of this is a rehash of what we know about the NG energy crisis, but this is a very good concise synopsis of the current situation. It's not getting any better either. Prices might retract a bit as the powers in Kalifornia will declare a victory by turning overe some unsold power plants to the utes in crisis and by allowing the utes to enter into long-term contracts, however, they still have to address the issues of growing demand, growing population, dwindling NG supply, lack of generating capacity, etc. Overall, a real drag on the economy and subsequently booming inflationary pressures. Recession is here, and only about to get worse. Time to lock-in some gold.
WASHINGTON (Reuters) - Treasury Secretary Lawrence Summers, who orchestrated multibillion-dollar rescue packages for Mexico and other nations, was to help mediate a solution on Saturday to end the electricity crisis in California that has pushed two major utilities to the brink of bankruptcy. Soaring wholesale power prices and an inability to pass those costs through to consumers have drained more than $12 billion from PG&E Corp. (NYSE:PCG) and Edison International (NYSE:EIX). With supplies of electricity already stretched to the limit, a severe winter storm earlier this week sent the nation's richest and most populous state perilously close to rolling blackouts. Summers and other senior Clinton administration officials were scheduled to meet with California regulators and power company executives at 4 p.m. EST (2100 GMT) to work out the final details of a plan to stabilize state electricity supplies. California Gov. Gray Davis and state lawmakers were to participate in the session from the West Coast via teleconference, according to sources close to the talks. Aides to all participants spent four long days earlier this week hammering out a proposal to provide immediate and long-term relief to California. The state's 1996 power deregulation law, once hailed as a model for others, lies at the core of the problem.
DEBT RELIEF, LONG-TERM SUPPLIES
Details were sketchy, but the plan was expected to give PG&E and Edison as much as 90 days' respite before the cash-strapped utilities must begin paying off billions of dollars in power purchases made over the past few months. Another provision would aim to cap wholesale prices at a more reasonable level for long-term contracts. Utilities were also pressing for the state to take on a new role by purchasing some wholesale power and reselling it to the companies. Negotiators reported ``good progress'' on Friday, according to a source knowledgeable about the talks. ``They're on track for the principals to reconvene and hopefully come to some agreement on Saturday,'' the source said. The governors of neighboring Oregon and Washington joined California's plea for a cap on regional wholesale prices to contain the volatile spot market. ``It is unfair to pass on to consumers the entire burden of the unprecedented increases in the wholesale cost of electricity resulting from the noncompetitive practices in the marketplace,'' the three governors said in a joint statement issued late Friday. A regional price cap has been endorsed by Energy Secretary Bill Richardson. But it was rejected by the Federal Energy Regulatory Commission (FERC), an independent agency that oversees interstate electricity sales. Consumer advocacy groups have been keeping a close eye on the negotiations. They have denounced any attempt to allow the utilities to pass through the soaring wholesale power prices charged by out-of-state generators, saying the industry has enjoyed big profits since deregulation and should have been better prepared for the state's current tight supplies.
WHITE HOUSE LEADS TALKS
Summers along with White House economic advisers Gene Sperling and Martin Baily stepped in to mediate after the California utilities' financial woes threatened to ripple through the economy. Summers, who has one week remaining as head of the Treasury Department, has made no public statements about the California power mess. The former World Bank economist has plenty of experience in untangling financial crises with his work arranging bail-outs for Mexico in 1995 and for Thailand, Indonesia and South Korea in 1998. The power emergency has pitted California utilities against out-of-state power generators such as Dynegy Inc. (NYSE:DYN) and Reliant Energy (NYSE:REI), who sold extra electricity to PG&E and SoCal Edison at rising spot market prices. Wholesale power sold on California's spot market briefly soared above $1,000 per megawatt hour but has since fallen to around $320 per megawatt hour -- still expensive compared to $34 per megawatt hour one year ago. Meanwhile, California state lawmakers and regulators have bitterly criticized the FERC for making the power crisis worse by failing to take bold action weeks ago. FERC, a relatively obscure federal agency, has refrained from cracking down on power marketers for reselling electricity at sharply higher rates than what they paid. Another key participant in the talks has been Ken Lay, the chairman of Enron Corp. (NYSE:ENE) and an energy adviser to President-elect George W. Bush.
Black Blade: And so it goes. Unless there is substantially more NG supplied to market, it does not matter. BTW, Bubba signed another EO this last week that puts 58.5 million acres of federal land off-limits. Since most of that land is in the western US, looks like Kalifornia is SOL.
WASHINGTON (AP) -- Inflation at the wholesale level remained tame in December despite a record surge in natural gas prices, but shoppers' caution translated into a weak rise in holiday retail sales, causing new concern about a slumping economy. President Clinton insisted the nation's record-long expansion is not in danger of tipping into a recession and cautioned the incoming Bush administration and the new Congress against providing excessive tax cuts that could jeopardize future prosperity. President-elect Bush, however, said in an interview that he had a ``relatively pessimistic'' view of the economy currently. He rejected suggestions that his $1.3 trillion tax package should be trimmed and said instead he was considering speeding up the tax relief to fight the slowdown. Supporting the view that the economy has slowed significantly, the Commerce Department said Friday that retail sales in December rose by just 0.1 percent. Overall activity was held back by a big 0.6 percent plunge in sales at department stores, reflecting a disappointing Christmas season as falling consumer confidence dampened shopping. In addition to reporting weak December activity, the government revised down its estimate of sales in the previous two months, showing an even steeper 0.5 percent plunge in October. The economic slowdown was having the desired impact in relieving inflation pressures. The Labor Department said Friday that its producer price index, which tracks inflation before it reaches consumers, was unchanged in December after only a slight 0.1 percent November increase, a sharp deceleration after two big monthly increases. While natural gas prices surged by a record 6.9 percent and the cost of new cars and trucks were also up last month, those gains were offset by big declines in gasoline and food.
Clinton, releasing a final 402-page economic report, said that the economy was slowing to a more sustainable rate but without a threat of recession. ``The economy remains strong, on a sound foundation, with a bright future,'' Clinton told reporters at the White House. He said Congress and the incoming administration should resist the temptation to use the projected surpluses for big tax cuts or huge spending increases. ``The combined impact of spending and tax cuts, I would hope, would not be such as to prevent us from continuing to pay down this debt,'' Clinton said. He said this would help the economy by lowering long-term interest rates.
Bush, however, in an interview published Friday in The Wall Street Journal, said, ``I've got a relatively pessimistic view about what the economy looks like. ... If, in fact, the economy is slowing down, as the numbers are beginning to clearly show, the operative word is: How soft will the landing be?'' Wall Street had a pessimistic outlook on Friday on more worries about worsening corporate profits. The Dow Jones industrial average fell 84.17 to close at 10,525.38 while the Nasdaq composite index was down 14.07 at 2,626.50. Bush spokesman Ari Fleischer rejected Clinton's suggestion that there was a danger of eating too much of the surplus with Bush's proposed $1.3 trillion tax cut. He argued that was a ``very reasonable'' slice to return out of projected government revenues of $25 trillion over the next 10 years. ``The president-elect feels very strongly that one of the best ways we could help protect economic growth is to cut taxes,'' Fleischer said.
Private analysts said the new report on retail sales provided further evidence of how bad the Christmas sales season was. In response, many big retailers have announced plans for thousands of layoffs in coming weeks. Analysts said the moderation in wholesale prices, which they predicted would be matched in next week's report on consumer prices, would give the Federal Reserve leeway to fight the economic weakness with further interest rate reductions. ``The Fed should read the PPI numbers with some confidence that if they continue to cut rates, inflation should not flare up,'' said Joel Naroff, head of a Holland, Pa. forecasting firm. The Fed surprised financial markets with an unexpected half-point cut in interest rates on Jan. 3, between its regularly scheduled meetings. Many economists believe that will be followed up with a further half-point rate cut at the Fed's Jan. 30-31 meeting and further quarter-point reductions in the spring. Fed Vice Chairman Roger Ferguson, in a speech Friday in Oakland, Calif., promised that Fed policymakers ``will act prudently and forcefully'' going forward to support sustainable economic growth. He said the Fed's surprise decision to cut rates last week reflected a desire ``to respond quickly and firmly to developments that deviate significantly from our expectations.''
Black Blade: And the blame game continues between Bubba and George Dubya. No one wants to go down in history with the Hoover legacy � although Bubba is still searching for one with 7 days to go. Bubba just needs to hold it together that long before passing off this hot potato to George. It's going to be very "interesting" � very soon.
Deregulation: Consumers are buffeted by prices of electricity and natural gas that are increasingly subject to the power of the profit motive.
By Marego Athans
Sun National Staff
Originally published Jan 11 2001 NEW YORK - With 10 minutes to go before the closing bell, the traders in the ring were shouting, waving hands, making hand signals, throwing paper and glancing nervously up at the neon-lighted boards, where the price of natural gas has been at record high levels for months - pingponging at rates up to five times those of a year ago. Historically, the trading floor of the New York Mercantile Exchange has been where the price is set for commodities such as grain and pork bellies, but over the past few years, this chaotic weekday scrum has also become a sophisticated marketplace for energy due to the transformation of the gas and power industry over the past decade. Once, state public service commissions set electricity prices, but because of market deregulation in key states, a free market increasingly rules. An entire new industry has sprung up of marketers, who link buyers with sellers and arrange pipeline transportation for natural gas to power plants or the transmission of electricity through interstate grids. If they're prudent, they come to "the Merc" or other such exchanges to buy futures contracts ensuring them against price swings. This is where exotic instruments such as California/Oregon Border electricity options are swapped by the megawatt hour. Or natural gas futures are traded in millions of British thermal units. Today, the energy marketers are getting particular attention because of a power crisis in California that threatens to bankrupt two giant power utilities and involve Wall Street, the federal government - and potentially U.S. taxpayers - in a massive bailout.
On Monday, California Gov. Gray Davis, calling deregulation a "colossal and dangerous failure," threatened to seize some California power plants if the state couldn't get some sort of price relief. The next day, as well as yesterday, he was in Washington pleading his case. The headlong plunge toward near-bankruptcy of the California utilities - Pacific Gas and Electric and Southern California Edison, which rank 73rd and 178th respectively on the Fortune 500- has resulted from what energy analysts have dubbed the "perfect storm." Warm winters over the past several years had kept prices for natural gas low, and drilling activity slowed because low prices gave companies little incentive to explore. Meanwhile, the federal government was encouraging the use of natural gas as a cleaner, more efficient alternative to oil and coal. Most of the new power plants being built were fueled by natural gas, though none was built in California during the past decade because of opposition by environmentalists and strict regulations governing potential plant sites.
When California deregulated on March 31, 1998, the state capped the price customers could be charged through the year 2002 at 5.4 cents per kilowatt hour, enough to make a hefty profit since utilities' costs at the time amounted to a little more than 3 cents. That formula worked, however, only if gas stayed cheap and demand stayed relatively stable. But demand grew throughout California - one reason was the enormous requirement of the Silicon Valley computer industry - and the Pacific Northwest, where the population boomed. In addition, the state provided no consumer incentive to conserve, said Rebecca Followill, a gas and power analyst at Howard Weil in Houston. Then, this year, the country was hit with a cold winter, adding to the demand, and natural gas prices increased to unprecedented levels. In January 2000, gas prices were barely $2 per million BTUs. On Monday, the price closed at $10.29 at the mercantile exchange and yesterday at $8.94.
A year ago, the two California power companies could have locked in the price of power they acquired from generating plants by entering into long-term contracts for as little as $38 per megawatt hour. Instead, they chose to speculate that prices would stay at that level or drift even lower, and that they could find all the power they wanted in the spot market. But prices exploded, reaching as much as $450 per megawatt hour. In recent days, the price has been around $300 per megawatt hour. The result: the two utilities lost more than $11 billion last year. As 2001 began, they were paying about 40 cents per kilowatt hour for electricity for which they were forced, by law, to charge consumers just 5.4 cents. As a consequence of the huge losses by the two utilities, their stock was battered on Wall Street and their bond ratings lowered. The bankers who extended them credit trembled.
But there were huge winners, as well. Companies that trade energy as a commodity are enjoying huge gains in earnings and stock prices. For the group that Followill calls the "energy convergence" group - those companies that market both gas and power, have trading operations and, in many cases, have pipeline assets and power-generating facilities - stock prices on average jumped 104 percent in 2000. Dynegy Inc., a Houston-based energy marketer, reported that its energy trading and marketing profits rose 80 percent in the third quarter. Its stock price rose 218 percent last year, from $16 to $56.06, ranking it among the year's top gainers on the New York Stock Exchange. Another Houston company, Enron Corp., whose chairman, Kenneth Lay, is one of President-elect George W. Bush's chief contributors and energy advisers, saw its stock price rise 87 percent last year, from $44.38 to $83.13. "For them as a group, it had to be the best year ever," Followill said. "In a market like the one we had last year, that's tremendous." Meanwhile, companies that acquired power plants in California from PG&E and Edison under the deregulation plan - notably Duke Power of North Carolina and another Houston-based firm, Reliant Energy - had the prices they could charge in California capped at $750 per megawatt hour, once an unthinkable figure and still far more than the current market price.
It is these outstate companies that Davis has accused of price gouging, and whose plants he has threatened to seize.
The California governor was not treated sympathetically when he came to Washington by Texas Sen. Phil Gramm, a former Texas A&M economics professor who told the Los Angeles Times that he would resist any bailout that would "take California politicians off the hook. "As they suffer the consequences of their own feckless policies, political leaders in California blame power companies, deregulation and everyone but themselves, and the inevitable call is now being heard for a federal bailout," he said. "I intend to do everything in my power to require those who valued environmental extremism and interstate protectionism more than common sense and market freedom to solve their electricity crisis without short-circuiting taxpayers in other states." Gramm is a conservative Republican and Davis a Democrat who some say entertains presidential ambitions in 2004, so partisan politics might be at play. But Gramm's view is a popular one among many energy company executives and traders who see the growth of a free market as a boon that will ultimately benefit consumers with lower prices. This group sees California as a stark example of all that can go wrong with deregulation.
Other states, such as Pennsylvania, have successfully made the transition without a disruption, and several states are proceeding with deregulation, including Texas, where Bush signed a bill approving the transition last year. One big difference is that numerous new power plants have come on line in Texas during the past decade, a situation proponents of the Texas plan say should spur competition. Eric Thode, a spokesman for Enron, citing this contrast, said, "It doesn't take a rocket scientist to see what the problem is. The problem has nothing to do with deregulation. It has to do with California." Texas also has a more realistic pricing policy, under which prices can rise twice a year if the costs of producing power increase. As more states deregulate, traders at the mercantile exchange say the futures market they are developing will become an essential part of the process whereby energy is produced and delivered. Most of those trading in natural gas on the exchange are not speculators. In fact, most of the trading on the exchange - 85 percent to 90 percent of overnight positions - represents companies trying to hedge, or protect their positions from future price swings. The other traders are speculators, and they are the ones who inject "liquidity" into the market, allowing prices to rise and fall. These speculators benefit from price volatility, which is driven by uncertainty as well as tight supply and increasing demand. Albert Anton, a partner and oil and gas analyst at Carl H. Pforzheimer & Co., said that while speculators don't exactly manipulate the energy markets, they can have some impact on prices. In volatile times, "the traders tend to push things a little too far," he said. For example, when oil spiked to $37 a barrel last fall, he said, "It didn't feel like the market should have been at 37, but the traders were going along with it because they were convinced something was going to happen in the Middle East. The speculators tend to exacerbate problems." But traders, as well as some analysts, say that energy prices would probably be higher without the open exchange. "Over the past 10 years, the movement toward marketers has made the system more efficient," said John Arnold, vice president of natural gas trading at Enron. "The competitive system gives price signals to the market. "If it were not a competitive industry, those signals might not get to the producers. What we've seen in California is that the price signals were hidden, and the market was short power."
While natural gas trading on the exchange is booming, electricity - which became a commodity in 1996 - has not matured at the same pace. Unlike oil and gas, power is difficult to transport and impossible to store, hindering the creation of a national market. And deregulation has been uneven among the states. As a result, while the other commodities are traded in their own pits on the floor, electricity is still traded by computer. One of the contracts on the exchange is a power pool that includes Maryland, Pennsylvania and New Jersey. While the Baltimore area's deregulation plan has been held up by court challenges, Maryland in general has moved forward, and the "PJM" pool has several new power plants under way now, scheduled to come online in the next few years, which should temper electricity prices in the area, said Andre Meade, a utilities analyst at Commerzbank Securities. As the electricity market finds itself, the Mercantile Exchange is developing an e-trading system that will enable people to trade commodities over the Internet, as they do stocks. In this brave new world, people will be able to hedge their own home heating costs by taking positions in futures markets. And at Enron, which helped pioneer the new energy market, executives are looking for new financial worlds to conquer. The company has already developed financial instruments to trade in weather-risk management, wind-power services, bandwidth and pulp and paper, and a host of other products.
Quipped Anton: "They'd trade bananas if there were money in it."
Black Blade: Ya just gotta love Phil Gramm's comments. They really hit the nerve next to the bone. Regulation or deregulation, it would make no difference. There just isn't enough NG to meet demand � plain and simple. Unless the energy industry gets off its fat a**, then this situation will get completely outta control. The economy looks to be toast at this point due to a lack of cheap energy. Inflation, more likely stagflation is the likely outcome if history serves as a teacher. Wealth preservation is a good idea, and that means hard assets like PM's. Get outta debt while you can and hang on for a wild ride � IMHO it's gonna be the 70's all over again.
Every Oligarchy is hiding its core essentials in total secrecy. We do not know and will never know, exactly, how much gold of any kind, is above or underground. Where and why it is moving or stored. But does this really matter at a price of 264$/ounce ? No, it doesn't. Because we are convinced of the essential character and purposes, of physical gold.
There will never be transparency in the gold-world. CB 's sales are confidence and POG shocking ! If there was just a bit of transparency, wich the infamous sellers are claiming,
....why don't they give the names of the bidders at the London auctions ? Is it (in this context) a crime to name the goldbuyers ? No, it shouldn't be. Imagine that, a few years from now, Britisch people could fingerpoint the profiteers, who were able to buy their goldreserves at ridiculous prices. Imagine a familly, suddenly realising that father sold the house to his mistress, for peanuts.
All the CB's shuffling with Gold in the actual extremely low Price perspective, is very conflicting. But the same goes for hiding one's currency-corrosion-erosion.
What I like on the Forbes article :
- Gold seems still to be a economic/political metal.
- Gold does still have a signal function.
- And most of all : " 350$ " monster-pivot point !!!!
Is it only a pure coincidence that POG = 350$ is so vital in Elliott Wave and Fibonacci - voodoo ?
POG-projections by (so called) analysts/observers, are working like dogs, to get the minus 200$ target ! Also pure coincidence. ?
But telling people where they have to park their money, for the time being...remains unanswered. They rather burn in hell than to fingerpoint the only alternative left : GOLD !
Funny how WGC, starts talking openly, about the London-auctions idiocy. Is it that difficult to mobilise the UK media, on the utterly nonsense of repeated sales of accumulated reserves ? Baaahhhhhh
Trail Guide, Randy, auspec and DavidG � Black Gold
Production:
Mining today is quite different from past practices in that only refractory methods were used, and the mining of gold sediment by panning. The low hanging fruit � the gold nuggets on the surface, and in the cores of underground mines everywhere but in South Africa were reached long before modern mining began. Any look at a modern mine's reserve structure shows that most of the gold is not recoverable at anything like current "real" prices (relative to other goods). Most of that portion was not recoverable at all in the past, as even high temperature refractory methods of the type used to obtain iron were not sufficient to recover most of it. But at higher "real" prices, the metal is recoverable at rather higher proportions.
It should be considered that the purchasing power of gold was substantially beyond current levels � or even levels seen at the 1980 peak. Prior to the Spanish conquests of America, and before banking took off, gold was not leveraged to any extent, excepting the three centuries of decline of the Roman Empire of the West, where the leverage was not effective because the coins were discounted to their gold content as one went further out from Rome. The monetary value of the metal at 40% reserve in Europe of the early 19th century was far below its value in times preceding it at near 100% reserve prior to the 15th century. To gain an appreciation, one has at least the 2.5 factor of leverage to undo, and then whatever purchasing power extension due to the non-linearity of the relationship � as a 2.5 fold decrease in supply is not going to produce a 2.5 fold increase in price, but a 6 and even 10 fold increase, if not more. Recent experience with natural gas should suffice to show the principle.
At that kind of purchasing power, one should expect that gold mining, then seen in the form of panning and underground mining by pick in a near 0 capital investment, as occurring over all of the history of man from one million years back to the advent of agriculture 40-50,000 years ago. Just as each European village had a blacksmith going back to the original inhabitants before the Germanic tribes came in, gold mining dates back to that same time and compares in intensity to iron production and working � where gold could be had, in the Greek isles, in Spain, in Turkey, in Egypt, and Cush (Ethiopia), in Persia, in China, in the pre-Columbian Americas.
The patterns of trade belie the flow of money � gold and silver � along the silk road and on ships, whereby imports from India, South East Asia, and China were coming into the Mediterranean cultures and their empires with a one way flow of gold and silver to the east, wherefrom came silks, fine porcelains, spices, rare woods, and precious stones for thousands of years, perhaps ten thousand years. Recent Egyptian findings have shown Thai opiates and coca plants from America, as well as spice plants from the pacific were grown in Egyptian temple gardens. Doubtless the people who could build gigantic monuments were more numerous and trading more intensively then the English and French historians were willing to admit at the time when ancient history carried importance.
If the value of gold was 5-10 times greater, and it had flowed for thousands of years in one direction, how much could have flowed? Say 5000 years at one tenth current production, what would the value be? 500 times current production of 2500 tonnes? 1.25 million tonnes? Even at 1/100 of the production volume over a period of 50,000 years one has that same level � without considering gold's higher purchasing power.
Jewish law dating back to before 500 BC in written form (in practical and spoken form it dates back much further) deals with trade, agriculture, and religious mores. Indicating that the bulk of people's time was not in raising and processing food for sustenance, but in making their physical and spiritual lives better. On average, it seems that people stop working purely for sustenance somewhere along the prior lines of hunter-gatherers in the jungle at 2 � 3 hours a day. Housing maintenance and improvement, decoration, and comforts, take up most of the time. Prior to the industrial revolution, industry was wholly within each household and village. Trade was limited to traveling merchants (peddlers) prior to the middle ages, and roving bands of thieves and stationary bandits known as nobility - knights.
Population density and population numbers.
Throughout history, and pre-history, people have settled from nomadic lives as hunters-gatherers to deal in agriculture. Studies of the few remaining nomadic societies in the jungles show that they put in about 2 hours per day in working for sustenance, and the rest of the time is spent in ritual and social activity, as well as decoration and other actions not related to subsistence. The people migrating out of the jungles and onto the plains would only have done so because it was necessary to do so for survival as competition with other bands would have raised the level of effort needed for bare survival (including fighting for territory). As one leaves the jungles for the plains, one sees the transition to long range hunting of herd animals and then fishing, and later to animal husbandry. Each of these requires progressively higher initial investments of time to form capital in order to gain sustenance � one needs food for the hunting expedition before the hunt (one also needs to feed the tool maker), and the animal husband needs to refrain from eating the lambs and the calves before they have matured.
Cultivation and fishing give rise to fixed settlements and a higher investment of time during particular seasons, and investment of time in building irrigation systems. These would not be built if there was no prospect of investing less time per person (on average) for sheer survival. If the time investment is greater, then people simply move elsewhere. In short, unless prevented by geography or force from immigrating, people will organize so that the average person puts in 2-3 hours of work per day for sustenance alone. Limitations on migration, or the simple end to the availability of arable land would be the only cause for subsistence taking up a greater part of the day.
Where this happens, and no migration is possible, the people react according to circumstances by (1) fighting over land and its produce, (2) lower effective fertility (formerly by lower infant survival, later by having fewer babies), (3) investment in capital and invention by necessity. Thus industrial technology for agriculture did not develop till new arable land became unavailable to anyone contemplating migration, as it lowered the cost of migration before migration was halted by the lack of somewhere to go. This only happened during the end of the 19th century.
It should also be remembered that the last ice age was still unwinding as the civilizations of antiquity developed. Much wetter conditions prevailed in the middle east and on the Southern coast of the Mediterranean. Some estimates have the population of the Jordan valley and its associated desert areas (they were not always desert) at 5 to 10 million.
Though reliable numbers are not available, it is well known that the Roman realm saw a depopulation as taxation to support the "bread and circuses" at home, made it impossible for the taxed plantation owners and their slaves to maintain the 2-3 hours per day of working for sustenance and prompted them to move � migrate out of reach of Rome's tax men. They left behind the whole estate, crops and all. Soon Rome fell to a relatively small band of "barbarians" from the North. The remaining population of the cities fled once free food was no longer flowing in, and service to the military was no longer profitable.
My point here, is that people have had the time to dig for gold, and have done so. They have traded over great expanses since time immemorial. Their trade had different levels of money: from salt, food (cattle) at the working class level; to silver and copper for the tradesmen; to gold for the merchants and professionals; gold, art, rarities, and gems for the rich and the rulers.
Rhodes and DeBeers
The same people who set up DeBeers to control diamonds, and have released them slowly over a century, also controlled the gold industry of South Africa. Today's mines in South Africa go down up to 4 miles, digging up their best ores. The better material and the easier digging was most probably evacuated by WWI, AFTER tens of thousands of years of non-industrial mining. Doubtless, Rhodes and Milner set up a depository for gold that was not put into the market, just as they did with diamonds.
The size of their hoard is unknown, but must have been substantial, on the order of a major central bank. Perhaps Quigley's successors will pry the information out of the inheritors of the Rhodes-Milner cartel at another moment of recklessness when they feel that they are on top of the world, or have given up getting there.
The gold they dug up surreptitiously, was never moved to Europe. Rumor has it that it went to Hong Kong, Shanghai, and other locations at the periphery of Colonial Empire. I don't expect to know with certainty the quantities or the whereabouts of this gold, but to say that ten or tens of thousands of tonnes are rumored to be involved.
In his research of oil company data, Hubbert found that they hide their reserves carefully, admitting their existence as replacement of reported reserves becomes necessary in order to maintain commercial or financial credibility. As he reports, it was not till the mid 1970s that the last unreported reserves were disclosed as new discoveries/reserves, though those were discovered in the 30s. This follows the well tested method of gaining credibility by putting away "reserves" of cash, gold, oil, completed and tested designs and research, etc.. The exploration for reserves, the sales plan, the design or research project are then sold and funded. With much pride and bravado, the completed project is presented on the date due. The funds are used for an entirely new and different project, which will be used to obtain new funding. One then obtains a reputation for good management and reliability, which provide a premium price on the market.
To expect less from the long lived former gold cartel of South Africa, 100 years old at its death some years back, is foolish. The Anglogold cartel of the past was given up only when the important discoveries dating back to the 1890s were depleted, and only official quantities could be produced � just enough to cover expenses. South Africa was then released from Apartheid when its resource was depleted. That is the pattern, and as Mr Guyatt was told, official production from South Africa was only 17% of actual output as recently as the 50s. Most likely, the difference between official and actual production was much greater in the early days, at well under 10%. That alone would raise the 20th century gold output to at least double and probably triple its reported levels; accounting for some 150,000 to 200,000 tonnes.
London markets
Prices of gold in London are relevant if you can get it there. If there is war and you can no more get to London than to heaven, then whatever amounts of gold leave London will be at a lower "real" price than they would be in areas where commerce is closer to normal conditions, e.g. Qatar during WWII (or WWI for that matter). The prices of gold were very well higher in the markets than officialdom would have one believe.
Indeed, in order to retain the gold-dollar parity, an elaborate system of quietly supplying gold was needed. Furthermore, there has never been a complete accounting of the gold supplied to market at the time, nor the source of that gold.
Needless to say, the source of gold pricing is supply and demand. If prices are falling in dollars, it is because the amounts of gold paper and bullion reaching the market are going in at a higher rate than dollars. That can only continue so long as the market believes that gold paper will be convertible at par with the real thing. The only way this parity would break is through the inability of the issuer of paper gold to provide bullion at par or an acceptable substitute (say Chrysler, or Banker's Trust, or Universal, real estate, etc.).
The approach to that condition would be preceded by a period where more real assets are traded for release from paper gold obligations as traded volumes of the suspect fiduciary gold securities decline concurrently. Next, one sees occasional periods of liquidity, where "call money", or spot gold (bullion in a known location), is in short supply and the scramble permeates the system to get hold of it. Hidden black gold would be used first, because it is hidden from popular view.
The markets would respond by taking a skeptical view of the paper gold contract's components, namely an over the counter futures contract, and a treasury or dollar bank account balance. These would see a rising interest rate, and a rush to exchange them into real assets (companies and real estate).
Finally, reaching to official gold hoards, the system would make a show of the puny supply in trying to demonstrate its availability while gold interest rates behave as they did in 1928 and again in 1929 � spike then crash � demand for borrowing fell as none expected to be able to repay, and none wanted to lend because they did not expect to be repaid for the outstanding debt, not to speak of any new debt. The interest rates were fictional, as no one borrowed and no one lent. Furthermore, gold bullion traded at a premium to paper gold one step away from the paper-physical exchange window. The premium was finally accepted by changing the official price to the market price, terminating the gold debt cycle. During the FDR revaluation of gold, a number of different values were proposed then shot down. Considering that the cycle was completed, the seeking was for a price acceptable to a hidden market.
Today, this would be seen in high premiums for coin and new fabricated gold (as in the use of 10kt gold instead of 14kt for low end American gold jewelry � re FOA's single atom per coin).
Unofficial Markets
Knowing first hand how a black market operates (somewhat out of date, but I am sure my experience is still relevant), and understanding that little or nothing in this market is different from the official market but for there being little recourse for the "little guy" if a contract is broken, but no problem for major players as they extract payment for breach of contract in a most total and effective manner. Furthermore, in this market, reputation is all. If a private bank and is illiquid, a simple delay in payment � even one accepted by the client - will cause a rush out of your bank and destroy its reputation. In this world, governments are just one more organization, with little or no superiority, as its executive members in open politics and the powers within the parties as well as in bureaucracy, are exposed as much to the rules of the unsupervised market as is anyone else.
Mr Guyatt tells us the parallel world trades more slowly but in greater sums, it is also the only manner of substance by which one can "take it off the table" � to perform the conversion of profit into real and permanent wealth, which I pointed out in a posting long ago is a precondition for a wealthy market player's participation in the official market. Without it, he/she would not ever make an investment because the official markets allow no assured avenue for exit, which requires government and other potential looters to know what you have and where you have it. The market in $20-50,000 art and antiques is cash and carry. Brokering is much more common as a business, and relationships are worth a goodly fee, often 10% per layer, with two layers being standard. "My people will meet your people" is routine, with no contact, or even knowledge of identity between the principals of the trade.
Mr Guyatt says that governments play a direct role in the black gold markets as fiduciaries and on their own behalf.
Considering that government is an organization, and that as such it is composed of people, and that these people are as susceptible to corruption as anyone else and are as self interested and determined as others are to do themselves favor, the likelihood of government officials actually being the honest custodians of public good many imagine they should be (and think they could be), is as absurd as can be. Where government officials are paid off, they are paid for services they provide; moving law and regulation in favor of their sponsor and against competitors, providing immunity to legal actions, acting to enforce cartels � to force members to abide by the cartel rules, acting as an arbiter between various interests of size, and to act as a fiduciary. In some European governments, the national institutions act as custodians for anything from land to art, shifting the burden and costs onto the public, and still allowing the unofficial owners to make use of them. Mr Guyatt posits that central banks act as fiduciaries with the banks, who in turn are fiduciaries to the black market gold players.
The government, however, also has an interest in obtaining control over those that would control its members. As little public accountability as there is in government, so there is a strong incentive on the part of government members to move against their black market sponsors and to grab the means for their power. The pro governmental agenda of declaring independence from most private interests is part of the loudly proclaimed socialist agenda, and is promoted by the few private interests who are (at least to their own thinking) beyond reach of government. It, like all currencies and government efforts of the past, will be disastrous. Some actually want the disaster to occur because that provides further public support to government usurpation of people's rights, and to the expansion of government control and power, and ultimately to expansion of their own power. In fact, after the civil war, government power expansion and extortion of private interests were the cause for private interests taking the more active role in shaping government decisions and to cooperate with the socialists.
Here it should be noted that the most obvious incorporation of private interests into government was in the Spanish war, WWI, WWII, and cold war expansion of the secret "intelligence" agencies and the foreign ministries. They were staffed by the private intelligence operations of the large banking and industrial interests and their socialist associates � in every country of size. The system thus constructed was intended for furthering government power on the one hand and forming a government within a government by providing intelligence agencies with arbitrary powers that they could use against the rest of the government. The more public portion of government that had been staffed by socialists then developed into a dangerous self-interested group that saw complete alignment between their official decisions, ideology, and their interests as practitioners of patronage. I believe that the current electoral, monetary, international, and legal debacles are related to an internal fight on the part of members of the private/government partnership in favor of cooperation with Europe's crackpot socialist/environmentalist nihilists and the opposing forces that want to push away from them and compete, knowing with certainty that Europe is demographically and politically deformed and can't keep up.
As in all fiduciary media entrusted to government in the past, the gold backing the certificates entrusted to government would fail as government would forever repeat its practice of trading fiduciary responsibility for quick political gains. The gold certificates, if the one from Germany is to be believed, have been lent out leaving about 20% reserves. I would tend to believe that all Western governments have abused their fiduciary duty and it is just a question of scale as to how much of it each government and banking system have remaining unencumbered. I would tend to believe that the US had done more to abuse its duty than anyone but perhaps Italy.
As to circulation of black gold, it seems that it circulates as it has always done, by proxy in the form of depository receipts. Though these may be thought to be fully allocated, they probably are not.
A couple of economic notes:
Though the days of the American monetary empire are numbered, I don't believe that Europe is on an actual ascendant towards domination. Its economic isolation and socialist leaning public and governments will prevent it from achieving substantial importance without foregoing the whole of the current political trends. The use of the Euro as an international trade settlement medium may never occur, as without its wealth preserving component intact, a currency will be destroyed, furthermore, a skyrocketing gold legal tender � which is what I saw as precedent in the action forced on the IMF by the US and Europe (presumably BIS) � would prevent the need for holding any currency balances at all. As the markets show a proclivity towards lending in the strongest currency available, gold denomination of debt contracts would soon follow a crumbling dollar so long as the Euro falls too (even if not so far). The Euro's gold backing will not matter at all as long as it is irredeemable to anyone. If it is made redeemable for anyone of size, then it will suffer the fate of all gold backed debt money of the past. The wild swings in expansion of international Euro lending last year are but harbingers of things to come.
Unlike the US dollar at the beginning of its present incarnation in 1934 and again in 1946, the Euro already has behind it an accumulation of debt, particularly government debt, that will hamper it badly and shorten its potential life.
Coming to the point of gold taking on the cumulative wealth value created during the gold credit expansion period, I want to add that it would not be quite the case today because there is a change in the composition of the economy on a global scale, whereby the cumulative portion of the economy � that of durable goods � has fallen. The growth in accumulated wealth around the globe, is manifest also in incomes that allow more expenditure on non-cumulative elements, namely prepared food, entertainment, subscriptions to information services, telephone, and other such economic activities which gold does not normally price proportionately. That will limit gold appreciation in real terms to a lower ultimate value of perhaps 70-80% of its potential relative to other such revaluations in history.
As to silver, it should be noted, as Von Mises pointed out, that silver was not demonetized by the market's free choice, but by intentional government policy coordinated around the globe. That government policy was part of a recurring mercantilist approach that bankers occasionally su
http://www.gold-eagle.com/gold_digest_01/hamilton011201.htmlFrom the link: "The ultimate fruits of Saddam Hussein's endeavor have yet to be felt in the United States. On average, it takes 30 to 45 days to transport Iraqi crude oil to American oil refineries. We suspect that a big slow-moving oil vacuum (kind of a "negative" tidal wave) is slowly oozing towards the United States. Since at least 53.4m barrels of crude oil is gone from the markets (and Iraq oil loading was STILL very slow at Mina al-Bakr and believed to not be happening at Ceyhan in early January � so the Iraqi shortfall is probably much greater than our estimate) this oil deficit is bound to slam into the US with full force at some point in the near future. It will probably be an awesome sight to behold."
Interesting article but I saw no reason given for why, in December, the price of oil dropped steadily at the same time Iraq was cutting the oil supply.
Trail Guide, Randy, auspec and DavidG � Black Gold
As to silver, it should be noted, as Von Mises pointed out, that silver was not demonetized by the market's free choice, but by intentional government policy coordinated around the globe. That government policy was part of a recurring mercantilist approach that bankers occasionally supported (and got their way more than once). The reason for moving towards gold alone was exactly the desire to slam shut the debt trap on South America in particular and on debtors in general. It never quite succeeded.
Silver will probably behave as before if it is allowed to. If the Euro reserve structure is going to form as you suggested it will, then there is going to be a politically motivated gunning up of the gold price. As gold surpasses prior historical ratios to silver, the intentional Euro-gold bubble will feed silver as gold will surely become over priced. It will also feed into the PGMs, as it has already.
Some more comments later this weekend or early next week.
It must be experimenting with paper oil futures games.
Unlike with gold up to now anyway, there is no unified
political consensus amongst the big players for full blown
manipulation, as they may stab themselves in the heart.
Who owns this 130,000 tonnes of Black Gold and where is it stored? Is it aggregated in few hands or widely disseminated?
If you choose to answer these questions, could you keep your answers brief so that all with an interest in this subject, myself included, can attempt to embrace the concept one piece at a time?
Also, am I correct that the figure we are talking about is 130,000 tonnes?
Yes, it certainly seems to fly in the face of what we understand about Supply and Demand. I wonder if it might have been for "demonstration purposes" to Saddam...kind of an economic shot across the bow to show him what he could expect if he didn't get back in line.
http://www.quote.com/quotecom/livecharts/default.asp?symbols=Take a look at the price movement of both natural gas and crude oil at the link above. Place the time view on "D" for daily. Type in CL01G for crude - take a quick look, then type in NG01G for natural gas.
Notice something?
Looks to me like the natural gas price explosion occurs almost exactly with latest (and sudden) downturn in crude prices...right at the beginning of December.
A quick, off the cuff theory...
Maybe a number of paper traders in crude switched to natural gas as the price exploded higher (chasing momentum). This may have caused a sudden vacuum in crude futures buying(?).
http://www.usagold.com/WhitherGold.htmlFekete argues that "The demonetization of silver by the market was a logical consequence" due to the difference in their specific values (value per unit weight).
He suggests that for silver, higher transportation costs per unit dollar leads to a wider export/import spread for the arbitrageur.
He concludes that "The upshot is that people will gradually move out of silver and into gold".
When I first read your posts, it was my personal opinion that you were as close to having a CPU for a brain as any human can get. I wrote a note "He processes endless amounts of information and outputs voluminous results. But whereas a CPU doesn't "judge" data, ORO, at the time of processing seems to apply "reason" to the input, and it determines the output. My disc (brain) has a lot of empty space, but ORO's, it is apparent to me, continually thirsts for more memory!" This is my highest compliment Sir ORO. I think MK's request is reasonable, but at the same time, don't deprive us of ALL the pertinent information.
Apex SilverThrowing in a few pennyweights of thought on Apex. They are many months behind on their San Cristobol project because of ongoing negotiations with Bolivia sources of power. In the meantime they have put all of their other exploration projects on hold, concentrating on San Cristobol. I am involved in a Jr stock that has a Mexican joint venture with Apex. From this perspective you could not pick a worse company for a JV. They show absolutely no respect for the junior company as far as time schedule, information, planning, etc. It's called withering on the vine while Apex twiddles their thumbs and various appendages. If Apex starves out a Jr partner they can then turn around and pick the goodies off the carcass on the cheap. Proceed with extreme caution in doing a JV with this outfit' imo.
Black GoldThe OFFICIAL #s are at 130,000- 140,000 tons. The "underground" supply is greater, of course, but at what multiple is the issue. DG has been rung so he will hopefully respond subsequently.
Be Ready!Belgian, per your post #45559....... "POG-projections by {so called} analysts/observers, are working like dogs, to get the minus 200$ target!" END
Yes indeed, I have said the same multiple times, and few want to hear it. What other strategy gets "them" out of their messy diaper {shorts actually}? They had 200$ within their sights when the WA spoiled it for them, but here we are again. You get ahead of the panic low and then you get ahead of the turnaround buying, and things start looking up a bit, not enough imo, but certainly a help. Give one enough time and control and little matters like this can be cleaned up nicely. {Never gonna happen}.
How about a counter strategy, just in case? This would likely be a fast paced market so we have to be ready ahead of time with some reserve money, line of credit, $ from favorite relative, piggy bank, sock money, whatever. Gold hits 198$ and we immediately call our favorite gold supplier, the one who's name stands for Contemplating Profits Major, and see what they have on sale. I have a very hard time believing that there will be many Sovereigns available for 198$ plus the usual commission. MK, do you have any comment on that? We beat "them" to the punch in the buying turnaround by doing what goldbugs are supposed to do: BUY!! They know goldbugs are incapable of selling on the way down so we have to concede that territory to them. If they want to join our buying, so much the better.
Only problem I see is that one little matter of accountability to the little "person" {gotta be politically correct here and there}----- Honey, you know how we were trying to get our mortgage paid off..............? Now that is a bold move, but if I do a little advance planning I can probably pull it off. If successful soon enough, I'll be a financial Wizard {move over Gandalf}, and if not................well, lets not think about that now. Maybe a 2nd mortgage on a spike down to 150$ {shutup already}. You know it's bad enough writing to strangers on a computer w/o talking to oneself in the process!
MK-- Do you think there will be a point where "premium coins" diverge from the $POG in case we do head a bit lower from here? In other words: What would be the availability of British Sovereigns, for example, at 200$ POG? Do you still have those loans available for no interest until 2003? {HA}. My guess is that at POG 200$ the Sovereigns would sell for, say 225$ per oz plus normal commission. Could you please start working on the suckers that are going to part with premium coins at firesale prices? Are you ready MK? Are you ready GB's?
Got a strategy?? Got GATA??
The worldwide War on Gold is an extension of the expropriation of Gold by Roosevelt and his henchmen in the 30's.
The demonetization of gold, all over the world, and the struggle to remove it from the public domain, public appreciation and public ownership by means of psychological warfare operations, is what we call the War on Gold.
Humanity is to be subjected to a psy-war with the purpose of abolishing the memory of gold as a highly valuable thing to possess.
Only a few - the majority of those who post here, are part of that minority - have the intellectual fortitude to withstand the continual psy-war being carried out daily, everywhere, against gold.
This is what we are up against: psy-war operations, make no mistake.
This brings to mind POL POT, and his gruesome campaign to bring society to a "ground zero", where all trace of previous culture was to be wiped out, together with as many millions of fellow Cambodians it might be necessary to exterminate. This, in order to install a New Society, Communistic in nature.
This was a prolongation in time, of the French Revolution, which had as an objective the destruction of the current civilization, in order to install a New Order. And the French Revolution, was itself an manifestation of a new faith, the faith in Reason.
A few years after that Revolution, the painter Francisco Goya witnessed its effects in Spain, and he made an frightful engraving with the puzzling title: "The Dreams of Reason Produce Monsters".
The latest Monstrosity we are witnessing, is the War on Gold. A project that is cousin to POL POT's attempt to exterminate all residue of humane culture in Cambodia, in order to carry out his Dream of Reason, which was a Communist Society.
The New World Order, deprived of gold, is a similar Monstrosity and we must, never, never, never give in!
<*sigh*> Uncle Sam: "We shall have the hyperinflation." Waiter: "Excellent choice, sir."
http://biz.yahoo.com/rf/010113/n12634779.htmlAddressing the Asia-Europe Meeting of finance ministers today, IMF managing director Horst Koehler set the somewhat foreboding tone with the mere articulation of these words:
"It is clear that the strong world economic expansion of the past two years is losing momentum. [...] But ... it would be an exaggeration to embark on doomsday scenarios now."
Looking into the medicine cabinet for a remedy, this is what Mr. Koehler (and others) sees behind the door according to this Reuters report:
--- "If necessary, the U.S. has further room to maneuver on both monetary and fiscal policy," he said, referring to the possibility of both a further lowering of interest rates and tax cuts.---
And more:
--- ...he issued a caution for any nation considering using a pegged-exchange regime: "There is essentially no room for error."
"While such regimes can succeed, the requirements for a country to maintain a pegged or heavily managed exchange rate are daunting -- especially when the country is strongly engaged with international capital markets," Koehler said. Koehler also reaffirmed the IMF belief that the euro was undervalued and the U.S. dollar overvalued.---
Your questions: "What would be the availability of British Sovereigns, for example, at 200$ POG? ... Could you please start working on the suckers that are going to part with premium coins at firesale prices?"
First, we must acknowledge that sovereigns and similar old world coins are held the Earth over by many peoples in many lands as a wealth management tool in the face of their many currencies.
If $200 gold were attained as the result of a monetary event (i.e. dollar strength relative to all others), then in these many other lands such sovereigns would likely have carried their owners through the storm and some would be sold as needed to compensate for any lost purchasing power experienced by their counterpart currencies. Such is the ebb and flow of global savings/capital.
More likely, such a price would not be the result of monetary policy and practice, but rather a temporary result of the price-discovery mechanism as has been so often and thoroughly discussed here. In such a circumstance, all global gold saving persons would be treated to a condition in which their currencies maintained their performance level, allowing them to increase their gold offtake by 20% at the same price as paid today. From where would the gold come to support such demand? Higher premiums above the paper-gold price would be the necessary consequence required to entice some savers to liquidate the metal needed for supply/demand balance beyond the capitulation-selling by weak hands.
@JourneymanGold standard is a relative recent phenomenon. Not sure but I think it was a trick created by the British bankers to control the world monetary system. They could afford it. At some point the British owned most of fiduciary gold. At least the British had some gold backing for their paper and even gold coins. There is no reason to have a gold standard unless you use fiat paper. For their part, the way Americans used the gold standard was to depreciate gold in favour of their paper dollar. Obviously it could not last.
Gold can be both money or a commodity. As well as potatoes, sugar, wheat or whatever(Services as well). You can always buy say sugar and pay for it in car or potatoes or again whatever. This is barter. The problem with barter is it is too bulky. Gold, to the contrary, has almost the biggest value for the smallest volume. I said almost because, right now, platinum, palladium and rhodium are worth more per volume unit. Also you can add diamonds and precious stones.
Today we are living in a the dollar standard system, where the dollar paper replaces gold. While the paper has no value whatsoever this is possible because the dollar has the full backing of the USA military power. Take our paper or else... This is not going to last for ever. This time, to depreciate gold, they have to get rid of their own or that of the nations in vassalage such as Germany and Italy. I have no means to prove it but I am convinced that German and Italian gold is gone already as well as part of USA proper. Deutsche Bank is rumored to be short of 5,000 tons of gold. Go figure.
IMHO. In a not too distant future, gold will be again used as a means of payment. Because CBs hoards are limited. Its value should be fixed according to the supply and demand scenario, although I have very little illusion for this to happen. The price of gold will, probably, move as a pendulum. Either much too high or much too low. Speculators and big guys will take care of that. It will be right once in a while exactly like a stopped watch is right twice a day. The trick is to buy at the lowest possible price and to get rid of it at the highest. Tough contract. As of now gold price is much too low. Whether it will still go lower is irrelevant. From now on, it is just a question of time before it starts to climb. When? How high? How fast? Three $64K questions.
USD/JPY : 101,5 >>> 118,6
Yen weakening against Dollar. Japan is one of the biggest dollarholders. Nikkei still unconscious. Is the US or Europ organizing a new Yen-carry-trade ? Making loans in a weakening Yen (Rand/Aus$) at low interest rate and buying strenghtening Euro's with higher interest rate ?
Momentum in these currency moves is dramatically increasing,Again.
Approximately 20% in less than 1 year gains or losses.
Again, GOLD is not participating in this Mega-action. Are these capital-flow tsunamis overuling the one and only possible stabilising factor : Gold ?
Japanese will not be tempted to repatriate their US$ holders into Yen. A rising Yen would definitely disadvantage their trade in Asia and US. So, they prevent the US$ from immediate collapse. And have to find a solution for economic slow-down at the same time.
A gently rising Euro, will also cause a slowdown towards $-trade. Maybe giving some oxygen to the US trade deficit?
Are these currency-fluctuations, natural economic fenomina ?
No, they have little to do with economic balances. It is a money-game, organised by the stongest and most powerfull paper magicians. Gold stands definitely in their way.
For each renewed capital-flow...another explanation pops up.
Currency-swings become more and more wild and ferocious.
The ocean of paper-money is to big to be used for trade in goods. That's why it has developped a profit generating process of its own, through destructive and disturbing flows. This is nothing new. But it becomes more difficult to justify, economically, these speculative profits, created out of thin air. Money-creation, rather than broadening free economic enterprise.
Is it the strive for dollar-supremacy, that at any cost, is keeping this machinations going ? For how long will Gold be victimised in this environment ? Comments ?
It shall be my HONOR to second the teachings of SIR ORO !!
SIR ORO honors us all for sharing his fantastic grasp of it ALL. We are soooo lucky to have him at the TableRound.
<;-)
=====
Parsifal (01/13/01; 12:34:32MT - usagold.com msg#: 45612)
ORO's message #45600
Certainly ORO's message #45600 deserves inclusion in the forum's Hall of Fame. Do I hear a second?
Parsifal
Let's assume for a moment that there is a huge hoard of black market gold. Black markets, by their very nature, are hidden, and it is difficult for normal folk and the "proper authorities" to tally the amount of black market goods. Of course, it would be naive of us to imagine that black markets are one day going to disappear. Black markets have existed for as long as recorded history, if not longer, and I for one don't think they are going to go away. If gold performs a useful function for some black market, then I don't think its function is going to be done away with, especially when one considers the properties of gold... no-ones debt... "gold goes in at any door". If anything, in a developing crisis situation, black market operations are going to be in demand (see World War 2 for example) and hence I don't see any great dishoarding of black market gold into the regular markets. Rather, the flows will continue "as before" into and out of the black market. It was with us yesterday, it is with us today, and it will be with us tomorrow. So too will be my gold coins.
ORO's..."Though the days of the American monetary empire are numbered, I don't believe that Europe is on an actual ascendant towards domination. Its economic isolation and socialist leaning public and governments will prevent it from achieving substantial importance without foregoing the whole of the current political trends. The use of the Euro as an international trade settlement medium may never occur, as without its wealth preserving component intact, a currency will be destroyed, furthermore, a skyrocketing gold legal tender � which is what I saw as precedent in the action forced on the IMF by the US and Europe (presumably BIS) � would prevent the need for holding any currency balances at all. As the markets show a proclivity towards lending in the strongest currency available, gold denomination of debt contracts would soon follow a crumbling dollar so long as the Euro falls too (even if not so far). The Euro's gold backing will not matter at all as long as it is irredeemable to anyone. If it is made redeemable for anyone of size, then it will suffer the fate of all gold backed debt money of the past. The wild swings in expansion of international Euro lending last year are but harbingers of things to come."
seems distinctly at odds with the position held by FOA and, it seems to me, it might be of value to have such a view clearly visible as one tries to get their mind around the issues discussed here at the forum. Perhaps this would even prompt alternative scenarios for consideration. So I will second Parsifal's msg#: 45612 nomination of ORO's message #45600 and Gandalf the White's msg#: 45618 second.
I, for one, am not keen on the success of the Euro. Murray N. Rothbard summed it up well when he wrote: "For the problem is that the new currency will of course not be gold, a market-produced money, but a fiat paper issued in new currency units. So that the result of this neo-Keynesian scheme will be inflationary fiat money, the issue of which is controlled by the regional Central Bank, i.e., by the new regional government.
This collaboration will then make it much easier for the Central Banks of the U.S., Britain, and Japan, to collaborate with the new European Central Bank, and thereby to move rapidly toward the old Keynesian dream: a World Central Bank issuing a new world paper currency unit. And then, we would be truly off to the races with the world's Money and macro-economy totally at the mercy of a world-wide inflation, centrally controlled by self-proclaimed all-wise Keynesian masters." Making Economic Sense pg 222.
Now, if I could only get that third nomination for the message 44583 from Perplexed...
Okay,I can't resist,even though I feel like a pre-schooler addressing a symposium of university professors.
Conspiracy theories abound,especially on internet forums; and look,they often rear their ugly heads at USAgold.No,I have no proof,only ideas and statistical work from others and boatloads of mere "circumstantial" evidence.
However,if we address this issue as the central bankers un-doubtly would,ie;establishing a policy with the "greater good" of the world community at large,honest money advocates such as ourselves will have to take our "rightful" place in this debate.By that I mean we are of the lunatic fringe,we just don't get it ,the new economy has displaced our argument and on and on.
There are ,however,irrefutable facts to our argument;there is a huge short position in gold,even GFMS will agree to this.Also when one examines the reserves of the world central banks;they consist primarily of US dollars.I recall the figure of 87%.Add to this historical correlations of the gold price to other indicators(as has been so well documented by Adam Hamilton,among others)that have been negated.
"Ah", the wise ones say,this just goes to show that gold is now a mere commodity,"get over it and move on with your life."
So, what is the problem here;to me it is one of fear,no, it is more than likely sheer absolute terror.The world central banks have built their currencies on their US dollar reserves,the figures plainly show in so many ways what a suspect asset this really is.To me,this is akin to constructing the foundation of your home using plastic explosive'sure it works but given a surprise event;ka-boom.Sean Corrigan illustrated this conondrum vividly in his essay "The Black King."
We are all aware that the financial elite that lovingly look out for our best interests meet and converse on a regular basis.The last few months seem to have brought some changes to the world finacial picture.All of a sudden the Euro(or the zero as many in the investment community had dubbed it)is now a tower of strength.But look;all of a sudden Japan has all of these terrible problems.Of course, with a little help publicizing the issue from the mainstream media,these problems(which don"t appear to have changed all that much over the last ten years),conveniently take the plunging US dollar off the main stage.Also,the falling yen acts as a counterbalance to euro strength.
Is this a conspiracy?Is the situation being managed by the great visionaries and wizards of the central banks and world governments? Frankly;who can hope to know?
Yes Sir, I am ready and want some more at 200$ !
POG's falling wedge needs to stop at 261$ (feb.) See fib. chart at Sandspring.com
Of course, I do agree with your insights. But want to be psy-prepared for this 200$ Target. Just in case.
Sierra Madre, has given the appropiate image of the POG (POLPOT) war. The goldwar has already a 21 years of age for me. It started with the runup to the Waterloo hill of 850$.
There we forgot it, to multiply 850$ with the Fib. retracement factor of 0,236 : 850$ x 0,236 = 200,6 $ Smile !
The other ones are : 0,618 / 0,382 : 525$ / 324$.
Goldwar = Emotions = Mass-psy. = Fibonacci.
And I'm sure that the goldwar is on for more than 5 years now.
A nice weekend to all.
General Fibonacci has ruled many wars.
I think you're onto something there, my good friend. I think the British sovereign and all pre-1933 premiums will rise if gold goes to $200 (which I do not hold out much hope for). I would like to take a moment to wish Andy Smith (who recently predicted a $210 gold price) and the boys much success in getting gold to that level. Myself and about 1000 Centennial clients will waiting for them when they bring the price to us down there on a nice golden platter. Having said that, I might also advise Mr. Smith to take to heart "Number Four" of "The Nineteen Life Instructions for the New Millennium from the Dalai Lama" (published in this month's News & Views) which reads: "Remember that not getting what you want is sometimes a wonderful stroke of luck." Only the Devil and perhaps Andy Smith could relish what might happen to the mining industry if gold were to plumb such depths. Not to speak of what $200 gold might say about the world economy (and jobs for gold traders at major bullion banks). I can say this much: At that price there would be so much demand for gold in general and for the pre-1933 coins in particular that I think the premium would jump considerably, but $225 per coin might be pushing it (just slightly).
All of which brings to mind an interesting question:
Have you ever wondered who it is that buys all this gold that the mining companies hedge out ad infinitum? I certainly do. I read this morning that the Canadian miner, Cambior, which is already up to its eyeballs in hedges gone bad, has worked out a new loan agreement with its lenders. Part of the package was the forward sale of even more gold -- 230,000 ounces to be delivered between now and the end of 2005.
Two questions:
One, who was the buyer of 230,000 of Cambior stockholder gold at 23 year lows?
Two, can someone explain to me how a company which almost went bankrupt (because its hedge book caved in when gold went up) can find redemption by forwarding more gold at 23 year lows -- and for five years out? Who knows where we're going to be in five years?
I'm sorry but I don't get it. But, hey . . . . . the banker feels good, the gold buyer feels good. Two out of three's not bad. (Ahem). Not that I revel in Cambior's difficulties. Far from it. I think I make my point. If you believe in gold, distrust fiat money and you're looking to insure your wealth, there's not much difference between $300 and $265 or $265 and $200 except that you can buy more ounces. Now if you're a speculator. . . .now that's another story.
. . . . .
P.S. There's another a(u)spect to this. I remember the dismal, dark day gold hit $100 in 1976 and I sat in my office contemplating where Fate had led me. The telephone rings and a crusty cowboy voice penetrates my defeat.
"Hey, you got any of those Krugerrands laying around?"
"Well, yes I do. How many are you thinking about?"
"All I can afford is two. I'm a miner in Central City and we're a little ragged -ss up here, if you know what I mean. But it's been a heck of run hasn't it? I can remember when the gov'nment gave us $35 and we were glad to get it."
"Yea, I guess you can look at it that way though I wish we were still at $200."
"Mark my words, young man (I was 28 at the time). You're talkin' to the man who bought at the bottom."
I laughed. He chuckled, snorted and said he'd be down "this afternoon." He brought me back. And sure enough he was the only one who bought at the bottom. Five years later gold was $800. And I spent an afternoon going through my files trying to find his old invoice. I wanted to frame it. I smile even now as I write this in his memory.
And I'll let you know the next time I get a call like that.
Maybe $200 gold will have the same effect -- the other a(u)spect I was talking about. Sometimes that spring loaded low is what it takes for gold to blow through all those chart stops and get the bull launched. But as I said, I don't think we're going to see $200. This past week's lows were probably related to options' expiration on the Feb contract.* If they were, it's not the first time a low was put in as options expired. We could start back up next week and these could very well be THE LOWS. In my view, the next bull market will launch quietly when no one is looking.
Onward, my friends.
* "The February options expired today. It looked like they were trying to keep it around $265 (an ounce) after knocking it down yesterday (Thursday)," said the vice president of a metals' trading firm in New York." Dow Jones 1/13/00
@USAGOLD and Auspec I'm amused of MK's answer to my friend Auspec - since I just got back and only skimmed todays messages - I was on the verge to put in an order for Krugers and Eagles at POG spot 205, "frontrunning" some daring analyst's outlook on (ir-)reality. Though, as an afterthought I guess, MK, would have had me put up 150% margin (cheap in terms of TOCOM Palladium) ... and as I've had similar experiences in the seventies - most volatile price actions in POG - after decades of manipulation (i.e. peg to US$ AND the promise to honor delivery)or suppression of reality, the constitutional guaranteed gold peg of the $ was severed for a second time and the consequences - even decisive then - may now after 30 year's and two failed London Gold Pool Scams may be construed as obsolete "propaganda".
After all the US - has been "'bezzled" out of its heritage of constitutional money - and has succumbed to an unconstitutional FED and forfeited many of its singular rights and liberties, making administrations of weakest link,or better lowest acceptance possible.
Well, you may think, who's talking here from an "over"-sozialized Europe (not as united, nor unionized as you feel)- as it was only a few years that the majority of Europeans have elected to be utterly conservative with the likes of iron lady Thatcher, Helmut Kohl and others (-coinciding with Ronnie and GWB)... a great era even the aftermath of socialists and dem's could not utterly destroy - yet.
As I probably should delete this post - I obstinately wont - it cost me some time, less thinking and a brown flu
tonic - not consumed - again yet, you bet.
best cb2
PS: MK - re- Century City/Black Hawk and, of course, Cripple Creek - been there and found it a lousy way to gamble any future of a ghost town to the prosperity of a mafia town. (See Cripple Creek Gold - The Money Mountain by Marshal Sprague)
PPS: Black Gold - while still not having received DG's
book and therefor won't really comment - I'll remain
a sceptic, or DG. found that I may be unworthy to digest his findings - mine(s) are precious and rare - even only to me!
I just looked up the CFTC Friday COT report on the S & P futures:
A new record short position by the Big Commercials, almost 90,000 short lots, while Big Commercials maintained their short position in Nasdaq futures.
I was shocked, to say the least, it seems to suggest that, despite Mr. G's aggressive rate cut, the big players actually increased their net short position in the market.
This along with a notable increase in big commercial long positions in the gold market.
Well, all I can say is that if the stock market is to tumble, it would be most appropriate and rightfully karmic if it happens during Clinton's reign, NOT afterward. He deserves a good deal of the blame for any impending financial debacle.
Is it possible that we might see market hell just before the inauguration?
Said the economist to the two engineers on the deserted island, "Let's just assume we have a can opener!"
Inpired by ORO's comment from (usagold.com msg#: 45600):
"If the value of gold was 5-10 times greater, and it had flowed for thousands of years in one direction, how much could have flowed? Say 5000 years at one tenth current production, what would the value be? 500 times current production of 2500 tonnes? 1.25 million tonnes? Even at 1/100 of the production volume over a period of 50,000 years one has that same level..."
Respectfully shaking my bowed head with eyes closed and forehead clasped in hand.
Please take notice and do always remember this: we are human beings, my dear sir, not ants. As were our ancestors before us.
Piling On!Now that Sir ORO is officially over the top with seconds for HOF nomination, I would like to officially add to the seconds. What a history lesson, what insight, and it DOES belongs front and center! We now know exactly where to point seekers, as this Black Gold issue unfolds. A blow has been struck for transparency, a layer of curtain shredded, the GB brain is thus permeated with new truths. One more for the USAGOLD FORUM and the internet!
David G will weigh in sooner or later, apparently temporarily MIA. The cause needs multiple "shallow tonsils" to step forth and divulge what we could never imagine. Truth is much stranger than fiction, and the psyc-war IS real. My favorite part of ORO's post was the words: "some more comments later this weekend or early next week." Am ready for more.
Also a great deal of intrigue with the following statements: "As in all fiduciary media entrusted to government in the past, the gold backing the certificates entrusted to government would fail as government would forever repeat its practice of trading fiduciary responsibility for quick political gains. The gold certificates, if the one from Germany is to be believed, have been lent out leaving about 20% reserves. I would tend to believe that all Western governments have abused their fiduciary duty and it is just a question of scale as to how much of it each government and banking system have remaining unencumbered. I would tend to believe that the US had done more to abuse its duty than anyone but perhaps Italy."
All I have to say about this is; 'Coming to a theatre near you soon'. This is a very twisted trail we are on fellow goldadvocates, hang on tight.
cb2- What the Hell is going on around here; people can just come and go as they please?!?!? Hello friend, check out today's and yesterday's Black Gold postings for a snoot full. I believe you were probably lined up for an autographed copy of the Secret Gold Treaty is what the holdup is. They're having trouble locating MacArthur, however.
Thank you Sir ORO for being willing to share your credible
insights! Let the unraveling continue!
@USAGOLDThis time Cambior forward sales has been made the normal way. There was no gold leased in this case. Only the bank agreed to paid in advance for 230,000 oz to be produced in the future. And as it is normal in such a case, it got a discount. It paid only the gold at $235/oz while the spot was around $265.
No gold was dumped this time. Have a good evening!
www.joelskousen.com WORLD AFFAIRS BRIEF Jan 5, 2001 Copyright Joel Skousen. Quotations with attribution permitted. Cite source as Joel Skousen's World Affairs Brief. Website: http://www.joelskousen.com
THE BUSH TEAM--HOW CONSERVATIVE?
After hearing the following exchange on the news, I'm not enthusiastic about president-elect Bush's ability to halt or reverse the present erosion of constitutional liberty. When asked what he would do as president if faced with congressional legislation that was clearly unconstitutional, his response was, "How would I know if it was unconstitutional?"
Well, it just so happens that the president is sworn to uphold the Constitution. He should at least have a sense of what is constitutional and what is not. Otherwise the Justice Department, which works for the Executive department, won't tackle constitutional issues in defense of original intent.
During the campaign the Bush advisory team was composed almost exclusively of old-guard, CFR and NWO globalists. The New American even published a dramatic series of photographs taken at a little-publicized press conference in 1999 in which George W. was surrounded and endorsed by the entire Kissinger team including Kissinger himself, George Schultz, and Brent Scowcroft. These three global controllers are still actively engaged in jet-setting around the world intervening in other nations� affairs. Major heads of states or their foreign ministers almost always pay a visit to one or more of the Kissinger team when they come to Washington on official business.
If that weren't bad enough, Bush still has on his team insiders like Richard Armitage and C. Boyden Gray who have formerly served as "black side" operatives with the CIA under George Bush Sr. Interestingly enough, it seems that the Bush transition team has become sensitized to all the discontent brewing within the hard-core conservative wing of the Republican Party and has dumped plans to give these obvious insiders the high appointments they were promised. Armitage, who wanted the position of Sec. of Defense has been denied any public position so far. I wouldn't be surprised, however, if he shows up as a Deputy Undersecretary in the Defense Department. Let's take a hard look at the background of the other Bush nominees for cabinet and advisor positions. It's a mixed bag of a few conservatives tasked with overseeing totally socialist programs and globalist insiders masquerading as conservatives.
NATIONAL SECURITY ADVISOR: Condolezza Rice
Rice (CFR) served on the National Security Council during the former Bush administration. Her mentor was none other than Brent Scowcroft. She has been carefully groomed for eventual leadership in the traditional way--by being named to a series of prestige building jobs that have kept her in the limelight for a return to service (Hoover Institution, World Federalist Society, Provost of Stanford University). By the way, if you track where up-and-coming people are placed within the "private" sector you can also track which companies and organizations are controlled by the CFR-globalist leadership. In fact, the National Security Council itself is staffed exclusively by advisors trained by and taking orders from the CFR and Kissinger Associates. These are the people who direct and influence the president in critical foreign policy issues.
SECRETARY OF STATE: Colin Powell
Colin Powell has a long history of being a military yes-man to the Powers That Be (PTB). As Deputy Assistant Chief of Staff for Operations in the Americal Division in Vietnam he was responsible for the initial investigation that covered up the facts surrounding the My Lai massacre. He was clearly responding to pressure from up the chain of command when he denied the claims of witness Tom Glen. He was rewarded for his "loyalty" by being given leave from the Army to pursue an MBA at George Washington in 1971 and was selected in 1972 as a White House fellow--a post reserved for those who show "future promise" to the PTB. He then joined the Pentagon as a military aide to Sec. of Defense Casper Weinburger. In that capacity he was directly involved in the transfer of weapons to Iran, via Israel, as part of the Iran-Contra scandal. Being part of this secret CIA operation, he was a natural choice to join the National Security Council in 1987. In 1989 he leap-frogged over numerous other senior officers in the military, who had greater military prowess, to become Chairman of the Joint Chiefs. He presided over the outrageous invasion of Panama which was a cover for the CIA take-down of Panama's Manuel Noriega, the CIA's drug and money-laundering bagman who, according to CIA defectors, was taking a much bigger cut of the drug profits than he was allowed. Many innocent civilians and soldiers (US included) were killed in this trumped-up war. Powell could not have been oblivious to the phony rationale for this invasion.
Then to cap his career in the Joint Chiefs, Powell presided over the NWO operations of Desert Shield and Desert Storm. While Powell is credited for being a brilliant strategist, military friends have told me it was really his top-notch staff of Marine generals at Central Command headquarters that did the actually planning and execution. Besides, no one can be considered a brilliant leader who failed to blow the whistle on Russia's double dealing during the war (although our "ally" Russia made almost daily resupply flights into Iraq to assist Hussein), and who allowed bad, experimental vaccines to be administered to our troops, without their consent, which resulted in the immune system devastation termed, the Gulf War Syndrome. Powell also acquiesced to higher authority and failed to prosecute the war to a final conclusion, allowing Saddam Hussein to stay in power. Due to his failure to permanently end the conflict, the Gulf region festers today, as intended. Forget all the hype about what a great Sec. of State Powell is going to be--Colin Powell is a CFR yes-man who will continue the same pattern of global intervention that has characterized every administration since FDR.
SECRETARY OF DEFENSE: Donald Rumsfield
Rumsfield (age 68) is an old team player with vast experience in the political trenches. Rumsfield was Sec. of Defense 25 years ago in the Ford administration. He failed to challenge the Soviet's extensive cheating on treaties during his watch, so he clearly is a controlled entity. He has a reputation for being one of the insiders� top head hunters, so he knows who is a reliable globalist and who is not. Rumor has it that he is demanding to pick his own people at Defense. We will be watching who he picks. Rumsfield has been positioning himself as more conservative in recent years--as insiders usually do when getting ready to take a public position in a Republican administration. He signed the letter along with other former secretaries of defense criticizing Gore's secret deal with the Russians over weapons transfers to Iran. He also came down hard on the Clinton administration for security lapses in the Department of Energy. But talk is cheap. I'm predicting he will continue the current military exchanges with both Russia and China. He was also head of Nixon's wage and price control program, so he's no fiscal conservative. Rumsfield was ambassador to NATO and served as the Middle East envoy under Reagan and put adverse pressure on Israeli PM Begin to make territorial concessions to the Arab powers after the invasion of Israel in 1973. By the way, VP Dick Cheney was Rumsfield's deputy Chief of Staff under President Ford and later succeeded Rumsfield as Chief of Staff. In short, Rumsfield is a nominal Republican, but his greatest allegiance is to the insiders who secretly run the US.
SECRETARY OF TREASURY: Paul O�Neill
The Treasury spot is always reserved for reliable insiders due to the heavy amount of manipulation that takes place in world and national financial affairs. For the first time in many years, the president-elect has selected someone who doesn't come directly out of the major government-connected Wall Street brokerage houses (like Goldman Sachs), which collude with government on a regular basis to keep the markets propped up. I suspect O�Neill is going to be the fall guy to be sacrificed when the economy goes down. Mr. O'Neill comes out of one of the big multi-national corporations, Alcoa, noted for its ability to do major buy-outs of other aluminum interests around the world without running into government interference. In the past two years alone, it has absorbed Alumix of Italy, Inespal of Spain and Alumax of the US into its empire. O�Neill is a reliable number-cruncher and manager type. He did government service in the VA and later served as director of the Office of Management and Budget during the Nixon administration. His ties to globalist insiders are telling. He has been a director of Lucent Technologies (a true insider-run corporation with close government ties), the Rand Corporation (a far leftist, pro-Soviet think tank), and the National Academy of Social Insurance (a liberal, pro-Social Security organization with a mission to derail the privatization of SS)
SECRETARY OF TRANSPORTATION: Norman Mineta
Mineta (another of the old liberals, aged 69, who should have been let out to pasture long ago) is a former Democratic California congressman who is the current Secretary of Commerce under Bill Clinton. He has consistently thwarted any attempt to uncover the mysterious facts surrounding the death of his predecessor, Commerce chief Ron Brown. It's no wonder. According to Judicial Watch, "Mineta participated in the 1994 Clinton Commerce trade mission to Indonesia, which involved John Huang and many others implicated in the Chinagate scandal, such as Charlie Trie, James Riady, and Mark Grobmyer." Mineta was also reported to have been a Clinton emissary to the family of Wen Ho Lee during an "active" federal espionage investigation of Lee at Los Alamos, as part of an effort to allow China to secretly acquire sensitive US technology.
SECRETARY OF COMMERCE: Donald L. Evans
Evans was Bush's campaign chairman and is supported by arch-liberal democrats such as Sen. John D. Rockefeller IV of West Virginia and Daniel K. Inouye of Hawaii. This bi-partisan enthusiasm is due to Evans� committment to continue trading with nations hostile to US interests like China and Russia. Evans is a longtime banking and oil industry executive and is a reliable globalist cheerleader for unlimited international trade. Mr. Evans pledged there will be "no more important role for the Commerce Department" than to promote US exports and enforce existing trade agreements. "No sector of the US economy operates in isolation from the global economy." These are the identical sentiments of president-elect Bush who stated that America's biggest threat was its "isolationist tendency." No, Mr. Bush, the biggest threat is from loss of constitutional sovereignty.
ATTORNEY GENERAL: John Ashcroft
Ashcroft is clearly the most conservative of Bush's appointees. His nomination as Attorney General is particularly puzzling since the Justice Department under Janet Reno has become the direct controller of the dark- side operations of all federal agencies with police power. To put a strong conservative into a position to discover these dark-side operations and block the normal round of cover-ups doesn't make sense--unless, perhaps, the PTB plan on derailing Ashcroft's nomination. The left is already gearing up for a major protest of Ashcroft's nomination. In other words, Ashcroft's nomination may be a bone thrown to conservatives. If he is sustained by the Senate, then I predict that government "black operations" will go deeper underground. There is some evidence to support this view. It may be the reason Bush has decided to retain FBI director Louis Freeh. Due to the many cover-ups that occurred under Freeh's watch at FBI, he is clearly an operator for the dark-side of government and would be in a good position to ensure those operations continue without alerting Ashcroft to the specifics. Look for Bush to nominate a new CIA director who will also shield Ashcroft from "black-ops."
HOUSING AND URBAN DEVELOPMENT (HUD): Mel Martinez
Mel Martinez is a mildly conservative Cuban refugee and Republican team player (who won't buck the PTB). His appointment was one of several "pay-offs" to keep the support of the Hispanic community. A lawyer by training, he is stepping down as the Orange County (Orlando, Florida area) executive and Chairman of Florida Governor Jeb Bush's "Growth Management Study Commission." He has proven to be a competent and honest administrator, so we should see a curtailment of the massive corruption presently going on in HUD. However, I don't expect him to try and to undo any of the bad socialist housing policy underlying the legislative mandate for HUD.
SECRETARY OF LABOR: Linda Chavez
Chavez is another legitimate Hispanic conservative who has earned the hatred of the left for opposing affirmative action and bilingual education. The left is gearing up to derail her appointment as well. They are focusing on her inter-cultural marriage to a Jew, Christopher Gersten, and the rearing of her three sons as Jews, decrying all of this as if she were a "traitor to her people." Funny how the left lauds multi-cultural relationships of almost any kind--but somehow conservatives don't qualify for praise. This is supreme, but predictable hypocrisy.
DEPARTMENT OF ENERGY: Spencer Abraham
This former Republican Senator of Michigan was head of the Senate Immigration Reform committee. He favors open US borders and was honored recently by the radical Marxist Hispanic organization National Council of La Raza for his proposals. He takes pride in compromises that put him in favor with the liberals and media--making him a prime candidate for future leadership in the CFR community.
EPA DIRECTOR: Christine Todd Whitman
Whitman is Bush's political pay-off to the feminist lobby. She is pro-abortion and a staunch supporter of the leftist "anti-urban sprawl" movement. Look to her to use her EPA authority to make it more difficult to develop land outside of major cities. There is a nationwide movement going on to attempt to implant an "Oregon solution" (Urban Growth Boundaries) on the whole US. I lived in Oregon as they implemented this "local control" fiasco. It wasn't local control at all--but a systematic top-down planning system based upon "goals" that opened up every small town in Oregon to environmentalist lawsuits if they chose any solution that deviated from official state goals. Don't let this happen in your state.
SECRETARY OF EDUCATION: Roderick R. Paige
Paige is former Houston school district superintendent and is touted as a conservative. This is false. No one is allowed to gain high position in the public school monopoly if they are a true threat to that monopoly. As one of my subscribers wrote, "Paige supports everything we've been fighting against in education for decades, including School-To-Work, charter schools and vouchers (which will bring private and home schools under government control), standards-based OBE, performance-based assessments, and behavioral direct instruction (which uses Skinnerian operant conditioning). In choosing Paige as his new Secretary of Education, Bush has assured the globalists who put him into office that the international education agenda will continue unopposed."
Another bad apple in Bush's education transition team is ex-governor Lamar Alexander who served as Bush Sr.'s Secretary of Education. He became infamous for his suggestion that we go to the hospitals and "count each baby" to make sure none of them slip away from our cradle-to-grave control system. Scary.
SECRETARY OF INTERIOR: Gale Norton
Norton is the former Colorado Attorney General who was a member of the Colorado Review Commission which issued somewhat of a "Warren Commission"-style whitewash of the Columbine High School massacre. To me it isn't clear what role she played in this. It is very possible that she, along with the others, were denied crucial information. If you want to read my analysis of the Columbine cover-up, go to the 1999 archives on the World Affairs Brief page of my website--no password required. There are two briefs dedicated to this topic.
In other issues, Norton has a very conservative background, especially on property rights. Former Interior Secretary James Watts was one of her mentors, and she has made a valiant stand on the correct proposition that environmental "takings" of property by government regulations and restrictions ought to be compensated--which would put a strong dampening effect upon the government's ability to control property without bearing the cost. There is a mounting opposition to her nomination by environmentalists because of this stand.
SECRETARY OF HEALTH AND HUMAN SERVICES: Tommy Thompson
Ex-governor Thompson spearheaded the nation's welfare-reform movement and will try to implement many of his work-fare proposals nationally. Despite (or perhaps because of) the success of these work-related welfare reforms, the left is trying to derail his nomination as well.
WORLD AFFAIRS BRIEF Jan 12, 2001 Copyright Joel Skousen. Quotations with attribution permitted. Cite source as Joel Skousen's World Affairs Brief. Website: http://www.joelskousen.com
REPACKAGING THE CLINTONS FOR THE FUTURE
There are still too many naive conservatives who believe that Bill Clinton is either not stepping down (Larry Nichols) or that he is going to fade into oblivion (Sen. Orrin Hatch). Both views are wrong and fail to understand that the Clintons are both promoted and controlled from non-elected positions of power well above the position of POTUS (inter-government acronym for the President Of The US). Yes, I'm openly discussing conspiracy here--which, admittedly, is politically incorrect--but it is essential that you learn to see how these kinds of operations are carried out.
Background: Since conspiracies of power operate with as few knowing conspirators as possible, the Powers That Be (PTB) use numerous indirect means to "influence" the desired behavior.
1) They make extensive use of "predictability screening" to select people for advancement who are either innately inclined towards a leftist, elitist philosophy ("only we educated, credentialed types are worthy of running the world"), or who are soft-thinking, Pollyanna Republicans with ambition (for those who are to serve, often unwittingly, as stooges in the phony conservative opposition). Those that rise to positions of relative power, that have to play an enforcement or mid-level directing role, must pass additional tests of personal corruption demonstrating their lack of principles and morals. The Clintons have excelled in the first and last categories.
2) They use a variety of inducements to draw ambitious people in and keep them loyal: promises of access to power, insider financial dealings (not available to normal people) to ensure a steady growth in wealth, rapid advancement without having to fully compete on a competency level with others, and (best of all) a promise of immunity from prosecution, if they cooperate and keep their mouth shut.
3) Ultimately, the PTB use force, often ruthlessly, to instill fear and maintain party discipline. Every high government official knows what happens to people who "talk out of school." Often loose-lipped people are disposed of in ways not very subtle so as to make sure everyone watching gets the message. Rumors of fearful consequences spread rapidly and stay around a long time--as Monica Lewinsky and Linda Tripp can attest. While few of the thousands of officials, bureaucrats, journalists, military leaders, and heads of powerful corporations know any details about this hidden power structure, they all know that a certain powerful force exists and that they must never ask any questions or try to penetrate the veil of secrecy. Many, I'm convinced, have rationalized their participation by convincing themselves this is a force for "good" or at least that it is "necessary" to keep the world from falling apart. Indeed, those in control may foster this view among those who have some vestiges of conscience, like the soft-thinking "conservatives" who serve in an opposition role.
Let me elucidate some of the current preparations the insiders are making to "repackage" both Bill and Hillary Clinton for future, but separate, missions in the global scheme. The odds are good that Bill and Hillary will split up and go their separate ways after he leaves office.
1) Access to power, more rapid-than-normal advancement. Hillary Clinton, with powerful assistance of media forces and the corrupt New York election machinery, has carpet-bagged her way into the prestigious seat of Senator from New York. It's now her turn to lead and she is being given an enormous amount of instant clout in the Senate that never befits a freshman Senator.
As for Bill Clinton, the globalist insiders are diligently beating the bushes to drum up a prestige position for the soon-to-be ex-president. They are having a little difficulty since Bill really isn't used to doing any real work that requires effort (he has a huge staff to write and prepare everything he reads). He isn't believable in a business role, and a think-tank role is both above him in ability and beneath him in prestige. Rumors indicate the insider head-hunters are trying to find Bill an international job, just like they did for Mikhail Gorbachev after he pulled off the grand deception of the Soviet demise. Currently Oxford University (Clinton's old alma mater) is being leaned on to agree to name Clinton chancellor. Of course, this means they will have to make the position a titular one, and let the vice-chancellor take over the real work. In my opinion, Bill Clinton's only use to the insiders is as a slick spokesperson--he has too many untrustworthy habits to rise to the top levels of power. Thus, Clinton will always require a prestigious pulpit and forum from which to speak--while others do the directing.
2) Insider dealings, financial support: You all remember the one-day $100,000 commodity profit Hillary made, courtesy of a "broker friend" of hers. I'm sure that some of that is still going on, secretly, in her behalf. But, one of the current and "above-board" methods the insiders use to feed money to their public lackeys flush is through huge book deals and speaking fees. Hillary has landed a whopping $8 million "book advance" from Simon and Schuster (owned by communications giant Viacom). No company pays these kinds of advance fees and expects to make enough profits to cover them. These are insider pay-offs, pure and simple. Pope John Paul II was given an $8.5 million advance and the publisher took huge losses. I don't know what the pay-off may have been in the case of the Pope, but he certainly doesn't lack for globalist connecti 01/13/01; 14:^7P �_��d.com msg#: ]�8) A Second for SIR ORO's #45600
Java Man, mhchuck, Peter Asher ,Thia Gold Thanks for the recognition
Javaman
Thanks very much for the nomination. Your statement of support is a very high complement.
mhchuck
My heart felt thanks to you also.
Peter Asher and Thia Gold
I too am a devotee of Holtzman, and like most all members of this forum read anything under his by-line. His latest post was in two parts, and it was difficult for me to reconcile both to the same author.
The first, a very gracious response to what you and I (Peter) both felt was an over reaction by HBM, was vintage Holtzman. The second, an attempt to make a case from a very convoluted position.
An almost gloating demeanor dominated his assessment of the debacle in Florida, as if "see, you colonist have not come as far as you would like us to believe, you still have feet of clay" an opinion shared by many citizens from many nations I suspect.
While most of us "colonist" will readily agree, especially about the feet of clay, though we living in this particular glass house, freely throw bricks from within, most of us are not for giving license to outsiders.
I am still trying to understand what I read. Oro puts so much information into one post it takes me awhile to understand the import or magnitude of what I have been bombarded by.
I agree with you that the information should be easily retreivable, and merits HOF, however, having spent the day trying to get a townhouse completed and ready to rent, it appears that I am too late to a process already complete.
Guyanor Ressources S.A. and Golden Star Resources Ltd. Announces Agreement With Rio Tinto to Advance the Paul Isnard Gold Project In French Guiana and Private Placement
CAYENNE, French Guiana and DENVER, Jan. 10 /PRNewswire/ -- Guyanor Ressources S.A. (Toronto: GRL.B; Nouveau Marche of the Paris Bourse: GUYN) and Golden Star Resources Ltd. (Amex: GSR; Toronto: GSC) are pleased to announce that a Heads of Agreement has been concluded between Guyanor and Rio Tinto Mining and Exploration Limited (Rio Tinto) with respect to the Paul Isnard gold project in French Guiana. The area covered by the agreement includes eight concessions held by SOTRAPMAG, a fully controlled Guyanor subsidiary, and the western part of an exploration permit held by Guyanor in western French Guiana, covering a total area of 216 square kilometers (the Property).
Under the terms of the agreement, Rio Tinto can earn a 40% participating interest in a joint venture relating to the Property by incurring expenditures of at least US$2,250,000 with respect to the Property on or before the third anniversary of the agreement. In order to maintain its option, Rio Tinto will have to incur, with respect to the Property, annual expenditures for all years, other than the first year of the option, of at least US$500,000. Unless otherwise specified, upon Rio Tinto having acquired its 40% participating interest in the joint venture, the parties shall contribute to work programs and budgets in accordance with their then participating interest in the joint venture.
Rio Tinto may also acquire an additional 30% participating interest in the joint venture relating to the Property by incurring expenditures, without contribution by Guyanor of at least US$6,750,000 with respect to the Property on or before the fifth anniversary of the agreement. Upon receiving notice that Rio Tinto has acquired a 70% participating interest in a joint venture relating to the Property, Guyanor will have the right to elect to retain its then participating interest in the joint venture and fund its pro rata share of all costs of the joint venture or exchange a 10% participating interest in the joint venture in consideration for the obligation of Rio Tinto to fund all costs of the joint venture until commencement of commercial production, such amounts to be repaid out of 80% of Guyanor's share of project cash flow at LIBOR +3%.
Carlos Bertoni, Vice President of Golden Star and President of Guyanor, commented, "We believe that Rio Tinto's decision to enter into an option agreement involving the Paul Isnard project is a recognition of the potential for a large gold and base metal deposit within the Property. It also reflects Guyanor's ability to conduct high quality, responsible exploration programs. The first year program envisions further evaluation of the known gold deposit at Montagne d'Or, as well as new exploration to define the potential of the historical Elysee prospect where Guyanor recently obtained significant gold intersections in trenches and adits. We look forward to working with Rio Tinto, whose expertise and approach toward exploration will add value to our exploration efforts in French Guiana."
Rio Tinto also agreed to purchase, by way of private placement, 500,000 common shares of Golden Star at a price of U.S.$2.00 per common share for total proceeds of $1,000,000. Golden Star will lend $750,000 of the proceeds to Guyanor to fund a work program on Paul-Isnard and a further $250,000 which will be used to partially fund the cost of a re-organization of Guyanor aimed at reducing ongoing costs. The work program to be funded by Golden Star using the placement proceeds will be in addition to the $2,250,000 of work that Rio Tinto is required to do under the Option Agreement. Closing of the private placement is expected on or about January 17, 2001. The shares have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States without registration or exemption from registration requirements thereunder.
Guyanor is a French exploration company in which Golden Star has an approximate 73% interest. Guyanor operates exclusively in the French Department of Guyane (French Guiana) and is focused on the identification, exploration and development of significant mineral deposits, principally gold and diamonds. Guyanor currently holds interests in the St-Elie, Yaou, Dorlin and Paul Isnard gold properties as well as the Dachine diamond property. Guyanor is listed on the Toronto Stock Exchange under the symbol "GRL.B" and on Le Nouveau Marche of the Paris Bourse under the symbol "GUYN."
Golden Star holds a 70% equity interest in the Bogoso gold mine in Ghana, a 30% equity interest in the Omai gold mine in Guyana, and a 50% interest in the Gross Rosebel gold project in Suriname. In addition, the Company has other gold and diamond exploration interests in the Guiana Shield in South America and in West Africa via its 73% interest in Guyanor and directly. Golden Star currently has approximately 38 million shares outstanding. The Company is listed on the Toronto Stock Exchange under the symbol "GSC" and the American Stock Exchange under the symbol "GSR". For additional information, please contact:
Carlos Bertoni, President, GUYANOR RESSOURCES S.A., Tel. 594 29 54 40, E-mail: info@guyanor.fr, Cayenne, French Guiana; or Peter Bradford, President, GOLDEN STAR RESOURCES LTD., Tel. (303) 894-4613 or (800) 553-8436, E-mail: pbradford@gsr.com, Web site: www.gsr.com, Denver, Colorado.
/CONTACT: Carlos Bertoni, President of Guyanor Ressources S.A., 594 29 54 40, info@guyanor.fr; or Peter Bradford, President of Golden Star Resources Ltd., 303-894-4613 or 800-553-8436, pbradford@gsr.com/
David GuyattI'm unable to answer your questions with any certainty because I'm unaware how or where the amount of 130,000 tonnes aroseView
Yesterday's Discussion.
http://www.gold-eagle.com/gold_digest_01/taylor011101.htmlAs we approach 4Q00 earnings reporting season and 'future guidance', Jan. 17th (OPEC), Jan. 20th (Bush), the next BOE sale (Jan. 23rd?), the next FOMC meeting (and resultant stock market reaction; I believe Jan. 29/30) and the upcoming GATA/Howe lawsuit the near term POG and possibly the mid-term POG become clearer. These very important events, IMHO, will set the stage for a bull market in gold. However, if these events do not go 'in our favour' I strongly believe that we will plow an uphill battle during the 4 year reign of President-Elect G. Bush.
Thoughts?
From link above:
"The manipulation of the gold markets is obviously continuing. The big question that remains is whether the Bush administration will continue to engage in the same illegal and deceptive acts as the Clinton Administration did. If it is smart, as soon as he takes office, Bush should tell the world that the problems we are beginning to face were caused because of market excess of the Clinton years and that those excesses were made worse by a money supply that has run out of control and also by a distortion of economic realty created by gold price manipulation through the office of the Treasury in the Clinton Administration. By so doing, Bush could protect himself politically for what is bound to be one of the deepest business contractions in 100 years and given the excesses, perhaps worse than that of the 1930's.
Will President Bush have the courage to expose this illegal act by the Clinton Administration? Now that the evidence clearly demonstrates that gold has been driven to artificially low levels by the Clinton/Greenspan/McDonough team of manipulators in conjunction with their crony capitalist friends at Chase, Morgan, Goldman Sachs and Deutsche Bank, the decision should be clear cut. Indeed the Republican power brokers have all this information in their hands so they are equipped with the knowledge to make the right decision.
Assuming Bush is able to get John Ashcroft approved as his Attorney General, we will quickly see whether he is as honest and upright as I and many Republicans believe him to be or whether the powerful forces that run this country, namely the Federal Reserve Bank, will show that the Republican party has just as much disdain for the law as did the Clinton Administration. This is important, not only as far as the gold markets are concerned, but whether our democratic republic can survive."
www.kitco.comDate: Sun Jan 14 2001 01:51
ERLE (Spam-O-rama) ID#190411:
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Hans Sennholz is a very long time small-r republican and Austrian economist.
He presents an Austrian school analysis of the bubble, which is not at all unlike the '29 version.
The Bulls and The Bears
There is a great division among economists over where the American
economy is headed. Essentially, they are divided into three different
schools of thought: the pessimists who believe that the economy is bound
to sink into a long and painful recession; the optimists who believe that
the former are doom- and-gloomers overreacting to a few negative
indicators; and those who are straddling the fence because they don't know
which side to come down on. All three camps obviously view the economy
through different theoretical glasses that color their analyses and
outlook.
Some optimists point to the fact that the American economy has weathered
a devastating storm in 2000 and, therefore, is bound to do well in the
coming months. Every conceivable obstacle has been erected and every
combination of events has been leveled at the equities market. Yet, the
economy continues to grow and the markets, though shaken, are holding
their own, despite several interest-rate hikes by the Fed, oil prices over
$35 a barrel, natural gas at $10 per MCF, many commodity prices falling,
real-estate prices skyrocketing, scores of dot-com companies failing,
taxes rising and savings fading, civil war in Israel, war with Yugoslavia,
and even a presidential impeachment. To withstand all such disruptions and
trillion-dollar corrections is to reveal exceptional strength, which is
bound to come to light in the coming months. For these optimists,
experience apparently is the only teacher who, in their judgment, is
preferable to any number of theories.
Other optimists are convinced that the Federal Reserve, under the
Chairmanship of Alan Greenspan, will avert any panic and avoid a
recession. The Fed and nearly all other central banks, they assert, have
become "Keynesians" who may not believe in Keynesian doctrines, but they
do not know what else to do. As long as the consumer price index does not
move up sharply, they will expand their credit. But it is unlikely that
they will succeed in reflating the old tech bubble; instead, they may
create new bubbles, which will be in weapons and raw materials, such as
oil, natural gas, platinum, palladium, and even copper. The weapons
bubble will build on the growing danger of war in the Middle East and on
the anti-American hostility of Iran, Iraq, Syria, Libya, North Korea,
Pakistan, Afghanistan, and the Sudan. In short, the profusion of
geopolitical crises and the Fed's return to Keynesianism make these
observers rather optimistic in financial matters, expecting great changes
in 2001 and numerous opportunities for alert investors.
The Keynesians in the camp of optimists echo their teacher:
John Maynard Keynes ( 1883-1946 ) who sought to give scientific
justification to a policy of vigorous government intervention. His
economic doctrines conquered the free world during the 1930s and have
shaped the economic policies of scores of governments ever since. While
Keynes was preoccupied with a depression- ridden world, his modern
disciples usually endeavor to make the national economy grow faster. In
the footsteps of the master, they call on government to increase
production, incomes, and jobs through the wise use of three important
policy tools: taxation, government spending, and money management. They
feature government spending which, they believe, enjoys the characteristic
of a "multiplier," that is, it generates an increase in income that is a
multiple of the original government spending. In the world of
Keynesianism easy money assures full employment and government spending by
officials and politicians multiplies the people's income.
In the optimists' camp the Keynesians argue with the "Monetarists" who,
on the foundation of overwhelming empirical evidence, hold to a version of
the old quantity theory of money and re-emphasize the importance of
monetary policy. They never tire leveling devastating criticism at
official monetary managers for having caused disastrous recessions through
gross mismanagement of the money. They point to a long list of Federal
blunders which, in their judgment, have increased in frequency in recent
years. There was the crash of 1987, the bear market of 1990, the bear
market of 1994, and the 1997-1998 financial crisis abroad. The present
situation is most precarious, they believe, because the Fed made the
monumental mistake of raising interest rates several times in recent
months. But as soon as the Fed cuts its rates, big rallies and visible
improvements are bound to follow. On January 3, 200l when the Fed lowered
its rates by one-half of one percent, they applauded. In the hope that
the Fed will continue to lower its rates, the Monetarists are happily
turning optimistic again.
The Wall Street Journal's semiannual survey of 54 economists arrived at a
consensus growth forecast of just two percent for the first half of 2001
and three percent thereafter. All economists expected the Fed to lower
interest rates, which should lay the foundation for stronger growth in the
future. But they differed on the very nature of the present difficulties.
One party viewed them as a mere reflection of a brief technical adjustment
of the economy; the other party saw fundamental changes due to rising
interest rates, the energy shock from rising oil, natural gas and
electricity prices. They pointed to the slowdown in technology spending,
stock-market woes, a budding credit crunch, even the colder-than-normal
weather. Nevertheless, forty-nine economists foresaw continuous economic
growth; only four expected the American economy to contract in the first
quarter of 2001. Thirty-five economists faulted the Federal Reserve for
raising interest rates too much. Twenty- three warned that tight money
would trigger a recession this year, fourteen hinted at the troubled stock
market, and ten at rising energy prices. It is significant that not a
single Wall Street economist expressed his disappointment about the
massive credit expansion that spawned the economic boom of the 1990s.
Some analysts in the fence-party camp are convinced that the information
technology has created a "New Economy" which fueled the great boom and may
also affect a decline. They are unclear on whether it will lead to a
painful recession or facilitate a soft landing and a speedy recovery. The
present downturn, they assure us, differs from others in the past in
three important ways. First, the stock market, which at its peak at the
end of 1999 recorded a stock value of 181 percent of gross domestic
production ( GDP ) , may significantly affect the economy on account of its
sheer weight and importance. Stock prices, which traditionally responded
to economic expectations, now may actually influence expectation and guide
economic activity. Second, the new technology may prove to be a
double-edged sword. It caused corporate America to make heavy investments
in computers, software, networks and Internet infrastructure. In a
downtrend some such investments may prove to be excess investments that
are abandoned. The period of heavy investments may be followed by a
period of scanty commitments. Finally, the rapid productivity growth in
recent years provided employment for ever more workers. If growth should
slow, companies could shed workers in large numbers. Unemployment would
soar, even if the economy should stay out of recession. A sharp fall in
jobs would mean a fast decline in consumption, which would decelerate the
most powerful economic engine.
Moreover, because the new technology provides business with instant
knowledge of sales and earnings, business is likely to react faster in
cutting back in a downturn. In short, having never experienced a
New-Economy recession, some fence-party analysts are bracing for some
difficulties but are refraining from calling a recession.
The camp of the pessimists, just like that of the optimists, consists of
a number of parties that agree on the basic trend of the economy � a
downward direction, but disagree on the reasons for their pessimism.
There are the "market realists" who point to experience as the only
reliable teacher. They know that the stock of great old companies sells
for under 30 times earnings; paying 200, 300, 400 times earnings for that
of newcomers is sheer folly. Even after the conspicuous decline of the
Nasdaq in 2000, there are still many companies the stock of which is
selling for 100 times earnings and more. Such prices are fever- driven
speculations that are bound to be corrected painfully. "Never buy into a
business that is unable to compete in the real world," they advise their
followers. The Nasdaq fever is like the great California gold rush, they
explain; fewer than 1 in 10,000 prospectors ever struck it rich. But the
companies that brought the people to California or sold them picks,
shovels, and groceries made enduring fortunes.
Other "realists" point to a potential credit crisis that is casting its
shadow over the economy. Throughout the financial boom the leading banks
freely extended their credits to many new enterprises that now face
difficulties. Apparently, suffering from the high-tech fever, they
readily financed new ventures at high rates of interest, but then, in
order to maximize their returns, failed to set aside the necessary
reserves covering the high risk. In just 12 months ending in September
2000, the debtor default to the Bank of America, for instance, rose from
$3.3 billion to $4.4 billion, but the Bank's specific reserves declined
throughout this period. The Bank management obviously accepted the talk
of a permanent transformation of the American economy through the
Internet, as did many regional banks. Their stockholders are bound to pay
the price for this exuberance. Moreover, the whole tech industry now
faces great difficulties raising capital at any rate. The banks'
generosity has turned into the opposite, a policy of scantiness and closed
pockets. In the junk bond market, interest rates have risen already to 14
percent, a level they briefly reached in the 1990-91 recession. A real
"credit crunch" is threatening on the horizon, which would gravely
encumber the American economy.
Congressman Ron Paul, a keen observer of the Washington scene, points to
glaring examples of the credit bubble waiting to be pricked. The
government-sponsored financial institutions Fannie Mae ( Federal National
Mortgage Association ) and Freddie Mac ( Federal Home Loan Mortgage
Corporation ) show $33 billion of shareholder equities with $1.07 trillion
worth of loans. Similarly, commercial debt barely amounted to $50 billion
in 1994; today it is ten times higher, exceeding $551 billion. When the
bubble bursts because of debt default, the economy is bound to flounder,
no matter how the Fed may attempt to prevent it.
A few pessimists apply psychological understanding to their analyses of
the economy. They distinguish between several psychological phases of a
bear market and economic decline. In the early phase only a few
knowledgeable analysts and investors perceive a maladjustment of various
markets and, therefore, begin to withdraw. Public enthusiasm may turn
into doubt and suspicion. In the second psychological phase, into which
the economy is now moving and which usually is the longest, business
conditions deteriorate and stock markets go down. Public doubt turns into
investor despair. In the third and final stage, the economy readjusts and
recovers although the public refuses to believe it.
These analysts expect the American economy to turn down rather quickly,
which should surprise most observers, including the governors of the Fed.
As the decline accelerates, the disaster in the technology industry and
Nasdaq is likely to turn into calamity for most other industries and the
Dow, including the blue chips. At the present, the Dow is still selling
at 20 times earnings and yielding a paltry 1.6 percent. Such prices and
yields are characteristic of bull market tops rather than bear market
bottoms.
During the economic decline the Fed can be expected to fight it "tooth
and nail." It undoubtedly will expand money and credit at unprecedented
rates in order to stimulate and revitalize the markets. And, in old
Keynesian fashion, the U.S. Government will boost its spending in order to
stem the decline. Unfortunately, all such policies merely render the
needed readjustments more strenuous and thus prolong the recession. They
help finance and carry the maladjustments instead of allowing them to be
corrected promptly.
The psychological analysts in the camp of pessimists often draw
conclusions similar to those drawn by Austrian economists who differ from
all others in their search for the ultimate economic causes. They
disagree especially with the Monetarists who believe that "exceedingly
tight monetary policies" cause depressions and that sufficient monetary
ease assures prosperity. In contrast, Austrian economists are convinced
that the propensity of officials and central bankers to inflate the
currency and expand credit leads to unsustainable structural
maladjustments that need to be corrected sooner or later. In fact, they
contend that the magnitude of the maladjustments accumulated during the
credit expansion predetermines the length and severity of any recession.
Kurt Richebacher, a German banker espousing Austrian economic theory,
compared the present excesses in valuations, money and credit expansion,
and economic fundamentals with those of 1929 when the stock market was
about to crash and the American economy sink into the Great Depression.
In September 1929, the price-to-earnings ratio of listed corporate stock
stood at 13.5 � at the beginning of 2001 the S&P 500 hovered at 24, the
Dow Industrials at 29, and the Nasdaq still exceeded 100.
Between 1925 and 1929 the stock of money ( M3 ) increased by some 10
percent � between 1995 and the end of 2000, it grew by a stunning 55
percent, more than five times the estimated growth of GDP.
The expansion of credit during the 1920s exceeded that of the stock of
money by a large amount. But it does not compare with the credit
explosion since 1995. While GDP expanded annually by some $500 billion,
the volume of new credits swelled by $1.4 trillion in 1997, $2.1 trillion
in 1998, $2.25 trillion in 1999, and an estimated $1.8 trillion in 2000.
This growth of credit occurred at a time of lowest rates of savings and
biggest trade deficits. Moreover, persuaded by the notion of great
corporate efficiency due to the new technology, many American corporations
reduced their liquidity to finance acquisitions and stock buybacks. They
purchased shares yielding minuscule returns with borrowed money costing 8
to 10 percent; this strategy is a clear signal for corporate
disappointments to come.
Current economic fundamentals make poor reading in every respect.
Corporate profits are virtually flat although the economy has been growing
at astonishing rates. But this growth has been financed by a massive
expansion of debt by both corporations and private households. The
feverish equity markets generated a psychological wealth effect that
stimulated the credit creation. A crash would soon turn the wealth effect
into a poverty effect, which would depress economic activity.
This writer agrees with the reasoning of his Austrian colleagues. But he
is at a loss about some of the conclusions they draw from their theories.
Kurt Richebacher, for instance, comes to the conclusion that "the stock
market crash was the most important, immediate cause" of the Great
Depression. Surely, we readily agree that the crash generated a "poverty
effect" which depressed consumption and promoted savings. But that's no
cause of depression.
On the contrary, while the consumers' goods industries may feel a pain of
readjustment and the producers' goods industries may stagnate for a few
months, the new savings tend to reduce interest rates, which may hasten
the needed readjustment. The rapid recovery from the post-World War I
decline ( July 1920-July 1921 ) clearly demonstrates the point. Surely, all
readjustments are painful and take time; they entail business losses,
capital writeoffs and temporary layoffs. They may lead to short
recessions, but are incapable of enmeshing a market economy in a long and
deep depression. Only government intervention can turn a market
readjustment into a Great Depression.
President Herbert Hoover and the Republican Congress managed to do just
this when they enacted the Hawley-Smoot Tariff Act of June 1930 which
raised American tariffs to unprecedented levels. It practically closed
U.S. borders and caused the immediate collapse of the most important
export industry, American agriculture. In the depression that followed,
the U.S. Congress struck another blow which shattered all hope of
recovery. The Revenue Act of 1932 doubled the income tax, raised estate
taxes, and imposed several new taxes. When state and local governments
faced shrinking tax collections they, too, joined the federal government
in imposing new levies. In 1933, in Hoover's footsteps, President
Roosevelt placed the government in the driver's seat. The National
Industrial Recovery Act led to the development of codes of prices, wages,
hours, and working conditions. It pursued the old daydream of prosperity
through less work and higher pay. And finally, we must not overlook the
Wagner Act of 1935 which took labor out of the courts of law and raised
the costs of labor, which again deepened and lengthened the Great
Depression. Only when more than 10 million able-bodied men had been
drafted into the armed services in World War II, unemployment ceased to be
an economic problem. And only when the purchasing power of the dollar had
been cut in half through vast budget deficits and currency depreciation,
did American business manage to adjust to the oppressive costs of the
Hoover-Roosevelt Deals.
It is unlikely that the George W. Bush Administration will repeat the
fateful blunders of the Hoover and Roosevelt Administrations. We know of
no plans for closing American borders, for doubling the income tax,
codifying business activity, or significantly boosting the costs of labor.
Guided by Keynesian and Monetarist thought, both major parties
undoubtedly will want to inflate more, create credit at faster rates and,
above all, increase government spending. But contrary to Keynesian and
Monetarist doctrine, such measures may actually hamper the business
recovery. Massive budget deficits and near- zero interest rates may
actually impede economic activity, as the Japanese recession throughout
the 1990s so clearly demonstrates. Or they may precipitate an
international run from the U.S. dollar, which would rekindle the price
inflation of the 1970s and 1980s. Blinded and dulled by Keynesian and
Monetarist thought, the politicians in power probably will act as they
always have acted: they will spend and spend and make matters worse.
Hans F. Sennholz
Taxation:
"Taxation is no simple fiscal matter. It presents problems of shifting, diffusion, and incidence, the difficulties of which challenge
even the ablest economist. Every tax sets into operation a chain of reactions that affect industrial production, wages, income,
employment, standards of living, mode of living, and so on. Most legislators probably are unaware of the numerous economic
effects of the taxes they impose. They may be unaware that the steep graduation of the income tax accomplishes the very
opposite of what it was meant to do. It perpetuates economic and social inequalities, and thereby creates a rigid class structure
that divides society. The expropriation of high incomes effectively prevents formation of capital and wealth that facilitate individual
advancement. How can an able newcomer from the wrong side of town rise to economic and social eminence if his "excess
income" is expropriated at every turn of success? How can he challenge the business establishment with its hereditary wealth and
position if he is prevented from accumulating the necessary capital?"
Debts and Deficits, 1987, pp. 132,133.
Alan Greenspan must be darn pleased with himself. Broad money supply has surged $112 billion in three weeks ($21 billion last week), bank credit has increased $61 billion in three weeks ($32 billion last week), the junk bond market is "going nuts" (from a message that was left on my answering machine � thanks Mark!) and speculation has returned with a vengeance to the stock market. From Bloomberg, the Investment Company Institute is reporting that money market fund assets increased last week by $67.7 billion, "the largest weekly increase in three years." And CNBC reported that Market-Trim Tabs is stating that $15 billion has flowed into equity funds since the Fed rate hike. In short, "reliquefication" is, once again, working its magic.
I am ignorant of the 'options' options. Do call options not involve impecible timing?
From your note:
"But, I thought you might be interested in knowing there are options available for those of us patiently waiting.
Examples
Dec. 2001 800 call for $160
or
Dec. 2002 1200 call for $255"
If I spend $160 dollars today to buy physical I can buy roughly 32 oz. If silver reaches $15, I would profit 10x32=
$320.
If I spend $255 dollars today to buy physical I can buy
roughly 51 oz. If silver reaches $15, I would profit 10x51=
$510.
Would you please explain the profits involved with your examples above.
Also from your note:
"As for me, well, I do know the prices now, don't I."
"The physical gold market is less than 2% of the size of the derivatives market. The annual supply deficit is only about 0.1% of the total market and central bank sales, which everyone is blaming for the demise of the gold price, are only 0.12% of the gold market.
The price of gold
The value of annual gold derivatives trading is twice as much as the total amount of gold that has ever been mined, and this figure is based on a conservative estimate of the size of the derivatives market. But only about 5,000 tonnes, or 4% of the total amount of physical gold, changes hands every year. It is obvious that the physical gold market is absolutely dwarfed by the size of the derivatives market for gold. It is logical and inevitable that the derivatives market, not the physical market, determines the price of gold."
-End quote-
This article is excellent; it starts my understanding of the 'paper' game. I recommend to 'newbies' like myself.
Here's the thought and the question.
The paper market 'dwarf's' the physical and C.B.'s lease/sell gold to maintain supply/demand numbers.
So, are the paper players shorting the paper market, creating an artificially low POG because they believe C.B.'s will continue to 'manage' the physical supply deficits OR are C.B.'s curtailing the supply deficit so that the B.B.'s do not blow up with their paper 'shorts'.
It seems to be a game of chicken, a case of the tail wagging the dog or is it vice-versa.
I recall reading an article recently whereby it was not the intention of the E.U. (upon the announcement of the W.A.) to have a spike in gold. They were not prepared for it.
It seems to me that the C.B.'s have no choice but to supply physical to the market (the 'underlying asset') to make up supply deficits otherwise the paper players WILL blow up.
It seems to me that possibly the C.B.'s are being 'played'
here with no option.
Do the paper players have the C.B.'s by the 'short and curlies' ?
www.gold-eagle.comAristotlean Logic and the US Dollar
(SnakeEyes) Jan 14, 11:00
The US dollar during the 1930's was still a hard currency. At least in international markets, the US dollar was redeemable for gold. The US dollar was essentially a hard asset in the 1930's.
The US Dollar today bears no resemblance whatsoever to this former US hard currency. That former US currency is long gone. As I commented yesterday, the current US dollar has no intrinsic value whatsoever, other than its "goodwill reputation". The two monetary vehicles, the old gold standard US dollar and the new US fiat dollar, have no fundamental connection or similarity other than sharing a common reputation by association.
The last time any significant monetary or consumer price deflation occurred in the USA was during the 1930's. That deflation occurred in relationship to the US dollar being a hard asset at that time. (It is not my purpose to argue at the moment that a hard currency US dollar was not responsible for the catastrophe of the 30's, although this can also be logically substantiated, but it is not the point of this post).
To slightly rehash what I said yesterday: The current US dollar is nothing more than a piece of paper with a reputation. If the reputation of the US dollar becomes damaged in a dollar denominated financial crisis, there is no way for the current US dollar to INCREASE in value against hard assets in such a situation. This is exactly what would be necessary for the US dollar to do in order to have deflation - the dollar would have to increase in value against hard assets. A theory of deflation involving the modern US dollar defies all logic, Aristotlean and other. The modern US dollar's only value, it's reputation, cannot survive in a financial crisis. It must lose value against all hard assets, not gain. A scarity of something that has just been the source of a crisis is not going to make that item (the modern US dollar) go up in value.
There is no logical conclusion other than massive hyperinflation in US dollar terms when this credit bubble collapse.
Thankyou for sharing your thoughts, which by and large mirror my own, with one addition. I remember John Lennon for one line..something like..Life is what happens while your planning the day.
One other thought about what you quote from the LINK. Is it possible that it's not a question of willingness to address and expose the scam, but that it's simply too big..so that exposing would mean the destruction of the US dollar/financial system. Just a stray thought, but what a deflating option to consider. And shouldn't we have seen some evidence by now that the cabal was moving to cover, with just a week to go before the official passing of the reigns. And what does this bode,I wonder, for the chance for change.
Adam Hamilton a.k.a Zelotes..."Saddam-ized Iraqi Crude"
TO: USAGOLD, all.
Please note that Mr. Hamilton's otherwise excellent article, "Saddam-ized Iraqi crude" contains a gratuitous insult to Christians, in that he refers to St. Paul, as "infamous".
It is incomprhensible that an article on petroleum, should have to include an insult to Christians.
Mr. Hamilton owes an apology for his unwarranted remark, to all Christian readers and posters at lemetropolecafe.com, and at gold-eagle.com
We have enough problems without remarks such as Mr. Hamilton's.
Game of Chicken {or Egg}?Canuck,
I think your post is spot-on. To me it's not so much the chicken or the egg, but The Whole Henhouse! They each have their reasons for doing what they are doing and they are essentially joined at the hip at this point. A careful read of a recent HOF nomination tells us that most western countries' gold supplies have been severely compromised. What other reason could there be for not having a legitimate audit of our national treasure? CBs, BBs, BIS, and our own FED run a {well?} coordinated machine, we are simply on the outside looking in and thus frequently perplexed. I believe THE LENDER OF LAST RESORT becomes the US$ as the first line of defense, and then the remaining fiats of strength. Remember, these clowns were looking into "THE ABYSS" 1 1/4 year ago. This means they don't have CB, ESF-FED-TREAS-FK, or Black sources of bullion to cover their ventures. It is gone or spoken for to a large extent.
There does exist a significant schism in monetary/banking philosophies, imo because not all can go along with the megalomaniacal, extreme games going on on the proximal side of the Atlantic. The Clampetts have turned EXCESSIVELY crooked and are running Hollywood!
ORO speaks of issues/divisions in #45600. A power struggle is occuring, but TPTB are firmly entrenched regardless of which side gains an upper hand & we remain on the outside looking in.
The US $ as lender of last resort means printing money, disguising same as much as possible {what's new?}, and keeping it all "hanging in there" as long as confidence allows. Gold is likely to take down the US dollar--their desperation is quite obvious with recent tactics.
FTKNOXFTKNOXFTKNOXFTKNOXFTKNOXFTKNOXFTKNOXFTKNOXFTKNOX------
There, it is now out in the open and can become a topic of conversation. At what point do US citizens not even care if the national treasure has been compromised? We're pretty close,no?
Clinton just simply wanted to keep everything intact until "the last hour of the last day". What happens from there he figures he can deal with utilizing a few lip movements, photo ops, and pandering to the "base". All boringly predictable.
Best to ALL!
A call option is the right but not the obligation to buy at a fixed price during a set length of time. What that something is has to be determined, whether a parcel of land or a specific amount of a commodity. Silver is traded in lots of 5000 ounces (gold in 100 ounce lots). Thus a call option for say Dec. 2001, at $8.00/oz for $160 means the buyer pays $160 for the right to buy 5000 ounces (one contract) of silver at $8.00/oz anytime until the option expires. That $160 is the total cost of the option.
If the option were exercised with silver at $15./oz, then 5000 ounces could be bought at $8.00/oz (the option's strike price)and then sold at $15./oz for a profit of $7.00/oz X 5000 ounces per contract = $35,000. In reality the option itself could be sold as is (it is not necessary to actually buy the silver and then resell) and the option would be worth more than $35,000 if sold before expiration because it would still have "time value".
Remember, if you bought physical at $5.00/oz and silver goes to $7.50 at option expiration time, your silver is worth 50% more than what you paid for it while the option expires worthless.
Buying an option requires a one-time premium payment. Futures positions and the sale of options are different and subject to margin calls. Both options and futures are extremely risky plays. Beware, this is risky business. I once sold for $5500 an option (on silver) that I had bought two months earlier for $175. Thank you Mr. Buffet for buying silver and raising the price for a short while. I've also lost a great deal of currency over the years playing this game.
I study extensively the fundamentals of supply and demand but mostly with grains and cotton which have a yearly cycle. Leftovers from one year plus total production gives total supply from which I subtract total useage to get yearend leftover again. This number divided by total use gives a number (percentage) that can be compared to previous years for price comparison. This is greatly simplified as there are a gazillion other things that influence the numbers but it's my basic approach to price prediction. Basically, none of this works for silver or gold. They're simply a gamble with big gains possible or (for me) affordable losses. How can we figure supply and demand when we don't even know if 130,000 tons of "black gold" even exist? In cotton right now, the big question is whether last year's crop in China is really 19.98 million bales that the government of China claims or the 18 million most experts think. Remember, there is no big risk with buying physical. A good basic book explaining the who, what, where, when and whys of options and futures is Bernstein's "How the Futures Markets Work". Available in paperback.
Last question, Yes, I most always hold some options for both silver and gold even tho I spend most of my research time and energy on cotton and corn.
If you're interested, I can recommend more reading explaining the commodities game. Gallacher's "Winner Take All" is another good introductory one but start with Jake Bernstein's. It's the perfect "first" one.
Also, if silver were to rise to 15-20 dollars/oz both physical and futures players could rejoice. Where do you think gold would be priced with silver at such prices??
Go Gold and take silver too!
Rich
Mountain of Gold DerivativesI got waylayed and didn't totally finish my last post. The question becomes: what lies at the base of the enormous quantity of gold derivatives? Is there enough gold/resources still present in ESF, Fed, Treasury, etc to backstop a gold "blowup"? If it is there, how much would they be willing to use? They seem to be playing this game "on the margin" which can be read as signs of weakness, also Canuck's game of "chicken". If the gold is compromised {it obviously is}, they could not in their right minds run it down to zero. These BBs are not total morons, there has to be a lender of last resort behind what they are doing. If not gold then the printing press or a combination of the two backs up their deeds.
The oil for gold theories basically say the gold has left the CBs. Frank Veneroso's supply/demand calculations say the gold has hit the market place and is gone from CBs.
I understand FOA to say that there is more "shuffling" among CBs going on than anything else, and gold largely remains intact.
The trail leads me to believe the gold is largely GONE, spoken for, or unavailable and we are left with razor-thin games "at the margin" by ESF, by hook, and by crook. Does anyone else care to weigh in along these lines of thought?
Sierra Madre you must have misunderstood Adam Hamilton
I know him personally and he is one of the best Christians
I know. I am sure he did not mean anything of the such.
I apologize for him if there was something you did not understand.
This does seem out of character, but it reads clearly "infamous". Gotta be a mistake of sorts? END "In Turkey, the pipeline runs through a striking mountain valley which eventually opens up into beautiful foothills and broad plains on the southern edge of Anatolia. The pipeline terminates at a lifting port near the city of Ceyhan, on the very northeast corner of the Mediterranean Sea. Ceyhan is only fifty miles east of the ancient city of Tarsus, hometown of the infamous early Christian evangelist Paul (formerly Saul of Tarsus}"
Credit Woes Could Hit State's Biggest Banks
The Associated Press
RALEIGH, N.C. (AP) - Three North Carolina banks are among the top 10 with the most exposure to corporate loans at risk of default, according to a study by New York investment banking firm Salomon Smith Barney.
The report released Friday said Charlotte-based Bank of America has $4.244 billion in corporate loans that could default in 2001 - more than any other bank in the country.
First Union of Charlotte comes in at No. 4 on the list of banks to watch with $1.08 billion in corporate loans that may default. Wachovia of Winston-Salem ranks No. 8 with $382 million in troubled corporate loans.
The result could be that corporations in North Carolina could find it more difficult to access credit this year, said Tony Plath, a University of North Carolina at Charlotte finance professor.
"Any time credit quality worsens, banks tighten their belts," Plath said. "It looks like we'll have three (banks) right here who will have to do some tightening."
Other banks on the report's watch list and their ranking are: 2, Bank One; 3, J.P. Morgan Chase; 5, FleetBoston; 6, Bank of New York; 7, KeyCorp.; 9, U.S. Bancorp; 10, Comercia.
Salomon Smith's report is the product of the investment bank's financial research team and is based on interviews with bond traders, bankers and credit analysts. The team first created a list of corporate loans that may default this year, then estimated how much individual banks may be at risk to these loans.
North Carolina banks are exposed to some of the largest loans on this watch list.
Bank of America is a participant in three of the five largest syndicated loans on the list. They include loans to:
- Owens-Illinois, a Toledo, Ohio-based packaging company, for $4.5 billion,
- Finova, a financial-services company in Scottsdale, Ariz., for $4.7 billion, and
- J.C. Penney, the retail chain based in Plano, Texas, for $6 billion.
First Union is exposed to J.C. Penney and auto parts maker Federal-Mogul of Southfield, Mich., which was loaned $2.1 billion
Wachovia is exposed to Owens-Illinois and a $7 billion syndicated loan to Stamford, Conn.-based Xerox.
Bob Stickler, director of financial communications at Bank of America, said the bank's No. 1 ranking is deceptive.
Not mentioned in the report, he said, is that Bank of America is one of the most aggressive commercial lenders in the country, which means it will rack up more bad loans than more consumer-oriented banks, such as San Francisco-based Wells Fargo.
Stickler also said that the $4.244 billion in estimated troubled loans represents just 1 percent of the bank's $400 billion loan portfolio.
"Look, everything's relative to how big you are," Stickler said. "We could write off every one of those loans that (Salomon Smith) says is possibly troubled and we'd still be fine."
But Bank of America does not have as much room to maneuver as it did a year ago, Plath said. If one of its large corporate borrowers defaults, Bank of America likely will have to dip into its cash earnings to increase its loan-loss reserves, he said.
"Bad loans have a profound effect on a bank's earnings and stock price," Plath said.
Credit problems were the primary cause for the rapid climbs and drops of bank stock values in 2000, the report said.
Wachovia's stock fell 20 percent after its announcement last June that it was increasing its loan-loss reserves to cover problem corporate loans. Bank stocks slid 12 percent in October after investors panicked over bank exposure to bankruptcies connected to asbestos-related lawsuits.
There is cause for optimism, said Harry Davis, an economics professor at Appalachian State University in Boone. The Federal Reserve's decision to cut interest rates earlier this month should make it easier for corporate borrowers to pay off their debts.
Lower rates also will make it easier for banks to put more loans on their books, thus mitigating the impact of problem corporate loans, Davis said.
"So long as the lending pie keeps getting bigger, banks can handle an increase" in troubled corporate loans, Davis said.
Ford's European chairman Nick Scheele said, "Indeed our strategic planning has always been on the basis that Britain would ultimately enter the euro, in some years to come, at a different exchange rate, not at today's exchange rate, clearly. And our strategic planning has been that way because we believe that with such a huge proportion of our exports, and indeed our import trade, based on the euro, it only makes sense for us to be in one currency."
The article goes on to say:
---Mr Scheele said he feared that the debate over the merits of euro membership was focusing too much on political considerations, and not enough on the economic implications.
"It [politics] has become the only discussion point in the whole debate. The discussion point to me that the debate should also centre around is what is the economic impact ..."
Mr Scheele said Tory leader William Hague needed to think care-fully about the implications of his policy to rule out British membership of the euro for the lifetime of the next Parliament.
"...I think the Conservative Party really need to look at where the economy is going to be driven if we are outside our major trading block."
USA'S TRIPLE ENERGY WHAMMY IN ELECTRIC POWER, NATURAL GAS & amp; OIL
Brian J Fleay
10 February 2001
By Brian J Fleay
10 January 2001-01
OVERVIEW
The USA is in a major electric power crisis. Peak power demand is exceeding reliable generation and transmission capacity, especially in California and on the west coast. The industry is trying to overcome the crisis by installing gas turbines just when the supply of natural gas in North America has reached a peak, creating in turn a natural gas supply crisis. The only short term solution is to reduce consumption of both electricity and natural gas, bringing energy efficiency back on the agenda. This requires a shift of focus to a co-operative environment between energy providers and consumers, away from the dominant of competition characteristic of the world-wide movement to deregulate the electric power industry.
The crisis coincides with an emerging world oil supply crisis as production of cheap oil outside the Persian Gulf countries peaks. The focus of oil supply is shifting to the latter countries who are not ready to invest in stabilising and expanding their production capacity to meet normal demand growth through to 2005 and beyond. Rising oil prices reflect this scenario. The US consumes 26% of the world's oil and imports nearly 60% of that for an import bill in 2000 of some US$100 billion.
US ELECTRIC POWER CRISIS
Base load electric power in the USA is provided by coal fired and nuclear plants with a lesser role for hydroelectric. To an increasing extent peak power demand is being met by gas turbines, either single cycle or combined cycle. In combined cycle hot exhaust gases from the turbine are used to raise steam and generate additional electricity, yielding much more per unit of gas. Gas turbines are being favoured for environmental reasons (less pollution and Greenhouse gas emissions), lower installation cost per MW and their shorter construction time while smaller units are economically efficient. A single cycle gas turbine installation costs US$300/KW as against US$2000/KW for a coal unit.
Electric power consumption has been growing at 3% pa since the mid-1980's, two-thirds of the increase being supplied by the utilities the remainder by the rapidly growing non-regulated gas-fired merchant generators, including industries now generating their own power with options to sell to the grid. The merchant generators chase the peak loads in deregulated markets - see below. These high growth rates have been driven by population increase, air conditioning and now by the internet. The proportion of houses with air conditioning has nearly doubled since 1975, increasing summer peak power demand. The internet has also been driving electric power consumption growth in the 1990's. electric power consumption grew by 5.4% in 1998, according to the Edison Electric Institute. The internet needs high power supply reliability.
US ELECTRIC UTILITY DEREGULATION
Deregulation of the electric power utility industry began in the mid-1990's, led by California with 23 states now participating, each with its own rules. Interstate power transfers come under Federal jurisdiction - and these are growing. The merchant generators are presently able to operate in an almost unregulated environment. In California the two biggest utilities, Pacific Gas & Electric (PG&E) and Southern California Edison (SCE) lobbied for deregulation and virtually wrote the legislation. In California and other states there is a transition regime while the major utilities sell off their power stations and become distributors and retailers, so ending the vertically integrated monopolies and introducing competition among the generators. During this period the retail prices of electricity in most jurisdictions are capped until fully "competitive" markets emerge. Independent electricity traders are emerging buying electricity from the generators and on-selling it to distributors, retail utilities and large industrial and commercial users. These changes are overloading the major transmission lines that were not designed for the increased power loads or their location. The public was told deregulation would lead to cheaper electricity.
Before 1990 there was a 25% installed generator capacity margin over peak summer demand in the USA, necessary for supply security - electricity cannot be stored. The uncertainty introduced by deregulation led to a cut back in investment in power stations and transmission lines so that by 1998 the capacity margin was below 10% - and worse in states like California where utilities import about 25% of their peak summer power load from other states. During 2000 there were over 40 occasions in California when Stage 2 emergencies were called with repeated incidents of blackouts and brownouts - these continue.
The spot market for electricity in California at the peak has reached US$1.50/kwh whereas their sale price was capped at 6.5c/kwh and was only 3c/kwh before deregulation. There average purchase price last year was around 30c/kwh. The price of natural gas has increased as well from US$2.20/1000c.ft. in late 1999 to spot prices over US$9 in December - see below for a discussion on natural gas supply. The merchant generators have been able to make windfall profits in this environment by exploiting the futures market in both electricity and natural gas. Similar situations have arisen in the US north east and elsewhere, but not on the scale of California.
PG&E and SCE (over 9 million customers) have accumulated losses of over US$9 billion since June and face bankruptcy. They applied to the Californian Public Utilities Commission (PUC) on 2 January for permission to increase their rates by 26% to 30% for six months to overcome the crisis. The PUC on 4 January only agreed to a 90 day 9% increase for residential rates and 7 to 15% for businesses. Stock prices of both companies immediately fell while their credit rating is now near junk bond status - which affects their continuing capacity to borrow and buy peak electricity. The following day stocks of major banks with significant loans to PG&E and SCE also fell, like the Bank of America and Citigroup. Further action is inevitable within weeks to resolve the hiatus.
PUC Commissioner Carl Wood said: "We are voting the epitaph for deregulation in California today. Deregulation is dead." Consumer advocates see no reason why consumers should pay for this fiasco for which they are not responsible.
The publicly owned power utilities in the Los Angeles region have yet to be deregulated and have not experienced problems on anywhere near the scale of PG&E and SCE. Some states took steps to ensure that deregulation did not undermine investment in new capacity through the uncertainty arising from the reform.
US NATURAL GAS SHORTFALL
Underlying this electric power crisis is a shortage of natural gas. US installed generating capacity was some 743,000 MW in 1998 with a peak load of 680,000 MW. About 90% of new capacity to 2010 is planned to be natural gas fired with 22,000 MW added in 2000 and as much as 30,000 MW expected in 2001 (Western Power's installed capacity in Western Australia's grid is just over 3,000 MW). The capacity of gas turbine manufacturers and installers is being pushed to the limit. Consumption of natural gas for power generation is growing at over 10% pa, the major contributor to a 2.6% growth in natural gas consumption.
Natural gas is the principal fuel for winter heating in North America, winter consumption is 50% higher than in summer while winter residential and commercial consumption is four times that in summer. Natural gas consumption has exceeded US production since the mid-1980's and Canadian imports now supply 15% of US consumption. However, US production has declined since 1997 with the increasing number of new wells unable to offset a doubling of production well decline rates to 40% since the mid-1980's. A similar pattern has emerged in Canada. Running faster and faster in order to stand still - or even go backwards! There is no way US production and imports from Canada can grow at 2.6% pa to fuel gas turbines to meet electric power growth through the next 5-10 years.
Some summer gas production is stored in depleted onshore oil and gas fields close to the demand centres to meet residential and commercial heating demand in winter. About 20% of winter supply is met from these storages. However, gas turbines supplying peak demand electricity in summer (the air conditioning load) is rapidly eroding the capacity to recharge these storages. The current winter is a cold one following three warm winters and these storages will reach record low levels by end March. Consumption is being met by drawing down the storages which could be depleted during 2002/3 winter or earlier. The weather and a possible decline in industrial uses will have a bearing on the outcome. For example, some nitrogen fertiliser manufacturers have shut down as rising gas prices make them non-competitive with imports. Kaiser aluminium has shut down an aluminium smelter. It is more profitable to on-seIl electricity purchased under long-term contracts than to convert it in to aluminium. Some have stopped stripping ethane, butane and propane from natural gas - it is more profitable to sell it as gas. Ripple effects in industry will follow and perhaps influence the price of liquid petroleum gas (LPG) world-wide.
Gas withdrawal rates from these storages will decline as the winter drawn down progresses and curtailment of industrial consumption may be needed during February-March cold spells to meet residential heating needs. Heating bills this winter will be 30% higher than 12 months ago.
US GAS SUPPLY OPTIONS
There are three options. Import liquid natural gas (LNG), develop gas resources in northern Alaska and along the adjacent Canadian Arctic Ocean coast, or develop gas resources at greater depth in the lower 48 states and in presently embargoed areas offshore on the east and west coasts and in the Gulf of Mexico off Florida. Investment of billions of dollars are needed and significant supply would only become available from about 2005.
There is some spare LNG terminal capacity at US ports, but insufficient uncommitted LNG supply or tanker capacity to supply them. New LNG production capacity is needed, most likely in Venezuela and Nigeria, plus a fleet of LNG tankers at US$150 million each, plus expanded US port facilities. Alaskan sources require a minimum investment of US$10 billion to develop gas fields and construct several thousand of pipelines on a minimum 6-7 year time frame. Long term gas prices of over US$3/1000 c.ft. are required to justify these investments.
Two-thirds of lower 48 states gas potential is thought to be onshore east of the Rocky Mountains in deep formations. Drilling costs will be double or more because of the greater depth and the time to drill a well will more than double. The east and west coasts are off limits for environmental reasons and will require new infrastructure such as offshore pipelines. A massive number of new and specialist drill rigs are required that is well beyond the current capacity of the rig manufacturers to build. 40-50% of the experienced staff (eg petroleum geologists) in the US upstream petroleum industry will retire over the next 10 years and there are few new ones in training. 15 years of low oil prices have taken their toll on the petroleum exploration and development industry world-wide, but especially in the USA. An ageing oil tanker fleet is now fully committed.
The constraints to the massive expansion required to exploit these hydrocarbon resources are as much in the physical resources and skilled personnel required to do the job. Such constraints cannot be overcome quickly.
CONCLUSIONS
Since the mid-1980's the world has been expanding its consumption of natural gas and oil. Over half the oil supply growth in that time has come from Persian Gulf countries turning on wells shut down in the early 1980's. The remaining growth has come from developing expensive sources in ever smaller fields outside the Persian Gulf, eg the North Sea and deep water in the Gulf of Mexico. At the same time low oil prices have decimated industry profit margins and forced a downsizing of the exploration and development industry, especially in the USA. As well as consuming a non-renewable resource, the upstream petroleum industry has also been consuming its capital, both fixed and human. And in the USA not developing its electric power infrastructure as well. In late 2000 the last of the effective spare oil production capacity from the 1980's was turned on - only Saudi Arabia has limited spare capacity left.
Suddenly the upstream petroleum industry has to run more than twice as hard to keep pace with growing demand for oil and natural gas, especially in the US where circumstances have also conspired to produce a major electric power crisis. A triple whammy!.
The only immediate solution for the US is to systematically reduce consumption of electric power, natural gas and oil, it takes time and dollars to overcome physical constraints. Any attempt to massively expand energy production must divert energy from the general economy to achieve this task, just as existing hydrocarbon supplies are declining. There are severe limits to the rate at which the energy industry can be expand under these circumstances. In the jargon of economics there is an "opportunity cost" of no small proportions.
So President-elect George Bush has the USA's greatest energy crisis in it's history on his agenda. He will of necessity have to preside over a contraction of oil and gas consumption in the USA, shortly after the US refused to do so at The Hague Greenhouse conference last year to reduce Greenhouse gas emissions!
The present thrust of economic development in the USA has hit an energy supply ceiling, economic growth in the old way is no longer possible. In California energy efficiency measures to get more service by consuming less energy are already on the agenda.
BIBLIOGRAPHY
Reports and papers from Simmons & Coy International. www.simmonsco-intl.com Click Research. Items since October give the most up-to-date information and several from April
to June are relevant. Simmons & Coy is based in Houston Texas and is the leading US provider of comprehensive financial services to the upstream petroleum industry. Its principal, Matthew Simmons, is a close associate of James Baker one of the leading Republicans in George Bush Jr's circle. This company is quite frank in its analyses and has sound relevant information.
Articles under "energy" in the Houston Chronicle, Texas. www.HoustonChronicle.com
Campbell, CJ, Perrodon., A, & amp; Laherrere, J 1996. The World's Gas Potential, Petroconsultants SA, Geneva.
Articles in leading oil industry journals since the early 1990's.
Campbell, CJ 1997. The Coming Oil Crisis, Multi-Science Publishing Coy UK and Petroconsultants SA, Geneva.
Fleay, BJ (1999) Climaxing Oil: How Will Transport Adapt? Paper presented to the Chartered Institute of Transport in Australia's National Symposium, Beyond Oil: Transport and Fuels for the Future, Launceston Tasmania, 6-7 November 1998. Published as Occasional Paper 1/99 by the Institute of Sustainability and Technology Policy, Murdoch University Western Australia. wwwistp.murdoch.edu.au See Section 5 in particular for constraints to expansion of the upstream petroleum industry. Kit Powell of Duke Engineering's responses to Brian Fleay's paper:
1. The articles you provided were some of the best analysis that I have read. There are a few statements I might quibble with but he pretty much sums it up. Put Brian Fleay in the realist camp not the pessimist's camp.
2. We do not have a shortage of energy but an over supply of people who do not want to live in a sustainable manner for their energy consumption.
3. As a result the electric crisis is really a transportation crisis. The same people who do not want coal or nuclear power plants built in their back yard also do want new power lines to carry the electricity.
4. Contrary to popular belief, the US is one of the most energy efficient countries in the world. When gross natural product is considered we produce more per BTU than just about any country. This is why we can afford to drive SUVs.
5. Therefore Mr. Fleay's conclusion "The present thrust of economic development in the USA has hit an energy supply ceiling, economic growth in the old way is no longer possible." The laws of supply and demand has essentially dictated that Washington Aluminum mills be shut down to support the dot-com industries that are willing to pay higher rates for electricity.
6. From the Utility Data Institute, in 1999, production costs, which consist of outlays for fuel and operations and maintenance, at nuclear power plants averaged 1.83 cents per kilowatt-hour, lower than coal at 2.07 cents and still far lower than oil-fired plants at 3.18 cents and natural gas plants at 3.52 cents.
7. Unless there is a massive and immediate upsurge in construction of coal or nuclear power plants (not very likely) to relieve the pressure on natural gas demand, gas prices will not return to pre-1999 levels and likey to go enven higher.
8. As a result, an environmentally sustainable (small) amount of electricity can be produced in the Methow Valley at lower cost than other news sources of power. The production cost will be essentially the labor needed or sustainable jobs.
Black Blade: I have to agree. It is a good sumation of the energy crisis. The NG situation is a bit more dire IMO. If GWB sits on this too long, then we could see an energy crisis beyond anyones wildest imagination. There will be a lot of deaths as a result and to mitigate the severity, the time for a massive exploration and production effort is now. The Grasshoppers will not like it, but unless they accept that coal, nuclear, oil, and NG power generation plants will have to be built in their backyards, they just might suffer the consequences regardless of all the legalese scribbled into law. Laws don't put supply heat in winter, air conditioning in summer, fuel in ones vehicles, power into ones homes and businesses. It is already too late, the only question is the severity. If you thought that Y2K was a potential problem, then you're really going to love what's coming down the pipeline. It's too late to satisfy Hydro-Carbon Man's addiction - within a few short years it will be every man for himself.
KUWAIT (Reuters) - Kuwaiti Oil Minister Sheikh Saud Nasser al-Sabah said after late night talks on Sunday with U.S. Energy Secretary Bill Richardson that Kuwait wanted to see an OPEC crude output cut of 1.5 million barrels per day (bpd). Sheikh Saud, often seen as a price hawk, told reporters after almost three hours of talks with Richardson who is on a last minute tour to rally support for a ``modest'' cut that a reduction of 1.5 million bpd was ``acceptable'' to Kuwait. ``...This is the amount being discussed within OPEC...It is not a unilateral decision and this is the figure we discussed at previous meetings,'' added the minister. Richardson is due to speak to reporters on Monday before leaving Kuwait but Sheikh Saud said the U.S. side talked during the negotiations of ``modest cuts'' by OPEC which meets in Vienna on January 17 to discuss a reduction in supplies. ``There were no (U.S.) numbers...I do not know'' said the Kuwaiti minister when asked if the U.S. indicated what level of cuts it favored. ``There is a basic point (raised) during our negotiations with the Secretary which is important to all of us. There must be consultations between us to avoid any negative impact on the economies of the United States and Europe,'' said the sheikh. ``We look at the interests of our friends and allies and expect them to also look at our interests and (oil-dependent) economies,'' he added. Richardson arrived earlier on Sunday after similar talks in the United Arab Emirates and Qatar to rally for steps which would lead to a drop in oil prices by some $5 a barrel.
He held talks in OPEC heavyweight Saudi Arabia on Saturday. In Abu Dhabi he said: ``The United States feels there should be no production decrease. But we are realistic and it is important that any cut in January will not aggravate the market ... Our objective is as small a cut as possible..'' The Kuwaiti minister said in remarks published on Sunday that OPEC was set to cut crude output by 1.5 million bpd despite Washington's latest effort to contain the size of the cut. Industry sources told Reuters that Kuwait would soon inform its customers worldwide to expect a reduction in supplies from the Gulf Arab state. Kuwait, which has an OPEC quota of 2.141 million bpd, was among the first states to call for an OPEC cut ahead of the seasonal drop in demand with the start of spring and summer in the northern hemisphere. The 11-member cartel is widely expected to agree to cut crude oil output by some 1.5 million bpd, pushing world oil prices higher in recent days. February crude on the New York Mercantile Exchange (NYMEX) leapt 64 cents to $30.05 a barrel, taking gains to 12 percent so far this year. Richardson said in Saudi Arabia that Washington would be content with an oil price of around $25 a barrel.
The Democratic administration of President Clinton is due to hand over power to Republican George W. Bush on January 20. Richardson's tour in the dying days of the Clinton Administration has raised some eyebrows in the region and a few sources privately questioned its viability and timing. In the UAE, Mohammad al-Hammadi wrote in al-Ittihad newspaper an open letter to Richardson in which he told him ''You had your (traditional Arab welcome) coffee, goodbye.'' ``Mr Minister: We cannot make any promises or pledges...The best message you can take back to your administration...is: 'A bit of justice would make the United States more objective in its decisions and requests, allowing states to show flexibility and meet these requests, he added in a blistering column attacking Clinton's eight years in power.
Black Blade: Let me see, Richardson is out of a job in 5 days. Yeah, sure, the powers in the ME are going to pay any attention to him. � in a pigs eye!
California governor begs Clinton's aid on supplies
http://biz.yahoo.com/rf/010113/n13689927_2.html LOS ANGELES, Jan 13 (Reuters) - Gov. Gray Davis has asked President Bill Clinton to invoke emergency powers to make three out-of-state natural gas companies keep selling their gas to California's largest utility, a statement released on Saturday said. Davis urged Clinton to invoke provisions of the 1978 Natural Gas Policy Act to require natural gas producers outside California to continue gas sales to San Francisco-based Pacific Gas and Electric, a unit of PG&E Corp. (NYSE:PCG). ``There is an immediate impact to public welfare based on the prospect of natural gas interruptions,'' Davis said in a letter to Clinton that asked for ``prompt consideration'' of the request.
Last week, the financially strapped utility appealed to Davis for state aid in buying gas for its 3.8 million gas customers, saying that as many as 15 to 20 of its supplier companies had refused to sell to it on credit and that gas reserves in its three storage facilities were dwindling. PG&E sells gas directly to households and businesses and uses the gas to power electricity generation plants in northern and central California. Davis has not responded publicly to that plea yet, but in the statement issued on Saturday, he cited three out-of-state companies as having threatened to cut off supplies to Pacific Gas and Electric: Duke Energy Corp. (NYSE:DUK) of Charlotte, North Carolina, Western Gas and J. Aron & Company. Representatives of the companies were not immediately available to comment. If granted, the emergency decree would be similar to an existing government order requiring power generators and marketers to sell surplus electricity to the California market. The U.S. Energy Department renewed that temporary decree for another week on Thursday. Davis took part by telephone in an emergency conference earlier on Saturday at the Energy Department chaired by Treasury Secretary Lawrence Summers. It was the fifth day of talks aimed at bringing down wholesale power prices in California and keeping the state's two major utilities from bankruptcy. Soaring wholesale power prices and a legal restraint from passing those costs on to consumers have drained more than $12 billion from PG&E and Edison International (NYSE:EIX), shutting them off from new credit from banks and many suppliers.
Black Blade: As I read this article, I could only think of the last scene in the original film, "The Fly." I somehow picture Gray Davis as the fly caught in the spider web screaming in that tiny, high-pitched voice � "Help Me! Help Me!"
Here's an interesting montage of long-term price charts
that show some interesting relationships. And some puzzling
non-relationships.
For example, look closely at the Jan 1996 runups that all
coincide with the rundown of GOLD at that point in time.
Compare the rundown of SILVER, during the same intervals.
You will see that SILVER has resisted the smashing better
than GOLD. Silver seems to be marching to a different drummer,
and its chart seems to mimic an averaged combination of
the TREABILL; OIL; and YEN charts. Very strange.
The 9-CHART.GIF is less detailed, to squeeze them all into
a single image. If you want to see the single detailed version
of each chart (and some others not shown) just backspace your
browser's url-entry and type in the image name at the end of the
url line from the listing below.
BRIDGETOWN, Barbados (Reuters) - With goats grazing in the center of the capital and a cacophony of calypso and reggae music belting out from tourist bars and rum shops, the Caribbean island nation of Barbados does not appear at first sight to be a thriving international financial center. But some of the most prestigious names in banking and investment, such as Barclays Bank and PricewaterhouseCoopers, have branches and subsidiaries here, and what goes on behind the office doors has made Barbados and a number of other tiny countries like it the target of ire from the world's wealthy nations. The former British colony, probably more famous for its cricket players than its financiers, measures just 14 miles (23 km) across at its widest point and 21 miles (34 km) in length and has a population of 267,000. The happy image of the tourist brochures belies a bitter history of slavery and colonialism, and the development of a thriving offshore industry has been a matter of national pride since Barbados received independence from Britain in 1966. You can pick up a leaflet from an investment company on a rack in a hotel alongside flyers for snorkeling or deep sea fishing. Glossy brochures on where to go to seek advice or set up accounts are handed out liberally.
WIDE VARIETY OF INCENTIVES
On offer are offshore banks, international trusts, exempt insurance companies, foreign sales corporations, tax holidays, an absence of withholding taxes on dividends and interest, and other incentives. The picture is similar in many other of the small island nations and territories in this region, from the Bahamas to Grenada, some of them with good reputations, others specializing in brass-plate companies and asking few questions of customers. A campaign by the Organization for Economic Cooperation and Development, a grouping of the world's leading industrialized nations, to crack down on tax evasion through the so-called tax havens has hit them like a tropical storm. It has provoked a wave of resentment against what they see as bullying and concern about the damage that any sanctions or tough measures might have on their fragile economies. The OECD, the Commonwealth and representatives of some of the 33 countries on an OECD blacklist are sitting down together in Bridgetown Monday and Tuesday to discuss OECD demands for a greater exchange of information and more transparency in the offshore centers' dealings. ``This event will focus the world's attention on our little island, for the mighty rarely sit with the weak to enforce their will,'' an editorial in the Barbados Advocate said. The OECD initiative is part of a wider campaign to combat money laundering and financial crimes. The U.S. government and officials in the fight against illicit drugs say bad guys ranging from Colombian cocaine barons to the Russian mafia use the offshore centers to stash their ill-gotten gains.
BARBADIANS RESENTFUL
Barbados itself has a relatively good reputation and has bridled at being placed on the tax havens list. ``The decision by the OECD has ... sent conflicting signals to investors in the capital markets around the world, who have, until the listing, justifiably regarded Barbados as a top-class jurisdiction for international tax planning,'' Phillip Nicholls, president of the Canada Barbados Business Association, wrote in ''Business Barbados 2001.'' ``Since the listing, many investors and their advisers have understandably been asking why,'' he said, accusing the wealthy nations of hypocritical self-interest. The Caribbean islands share a similar history, and their current laments are largely the same. Their traditional economic mainstay of agriculture, mainly in bananas and sugar, has dwindled over the years in the face of falling commodity prices and the removal of favorable quotas. Tourism became the new backbone of their economies, with planeloads of sun seekers from cold Europe and North America flocking to beaches and enjoying their exotic and laid-back charms. But that industry is very competitive. It brings with it environmental and social problems. And it can be vulnerable to factors ranging from an economic downturn in the rich countries to the fury of hurricanes.
HISTORY IS CITED
The Caribbean nations and territories say they were encouraged two decades ago by Britain and others to set up financial services industries to build self-sustaining economies and are now being betrayed. ``We were pushed to do it,'' Bobby Khan, corporate affairs director for Frank B. Armstrong Ltd., told Reuters. In Barbados, which charted its course about 15 years ago, the financial services industry provides direct employment for about 2,000 people. It also gives a boost to other industries, such as construction, and provides about a third of government revenues. A collapse could have dire social and economic consequences, Khan said. Economic hard times could bring with them corruption and crime. That in turn could hit the tourist industry. ``We feel a healthy country is a country where people are employed. We don't want to rely on aid for development. We want financial sovereignty,'' he said.
The blacklisted countries also complain that they are being unfairly picked on, as other major countries are also open to tax avoiders. Charles Intriago, publisher of the Miami-based Money Laundering Alert newsletter, agreed that there was a certain double standard. ``How many billions of dollars are sitting in banks on the U.S. East Coast on which no tax has been paid to a foreign government?'' he asked. ``Billions and billions.''
Black Blade: Typically, the big nations pick on the small nations. The US attacked and conquered the mighty Caribbean powerhouse of Grenada. I guess that at the very least we secured our nutmeg supply.
Colorado may be repeating California electrical disaster by iNet News Manager
http://www.ecotopia.com/news/article.asp?id=1561Oil Crisis News from Around the World source: The Coming Global Energy Crisis
Boulder, Colorado �� Jan. 12, 2001 �� SolarQuest� iNet News Service ��
following is the full text of a letter from ...
ALBERT ALLEN BARTLETT
2935 19th Street, Boulder, Colorado, 80304-2719
Phone, (303) 443-0595: FAX (303) 492-3352
E-Mail: albert.bartlett@colorado.edu
January 4, 2001
Hon. Bill Owens, Governor of Colorado
Hon. Terry Phillips, Colorado Senate
Hon. Ron Tupa, Colorado Senate
Hon. Todd Saliman, Colorado House of Representatives
Hon. Tom Plant, Colorado House of Representatives
Hon. Alice Madden, Colorado House of Representatives
Dear Friends,
It is simply outrageous to read how the U.S. Secretary of Energy came to Colorado to ask western states to sell electric energy to California to help bail out Californians from a big utility problem that Californians have created for themselves.
The unfortunate thing is that we in Colorado may be well on our way to repeating the California electrical disaster.
WHAT HAPPENED IN CALIFORNIA?
Here is what seems to have happened in California:
1. The population of California has been growing rapidly for decades.
2. Population growth causes growth in the demand for electricity.
3. It is apparent from California's shortages of electrical energy, that the utility companies in California have not constructed new electrical generating capacity sufficient to keep up with the growth of demand for electricity in California.
4. If these statements are correct, then it can't come as a surprise to learn that there is an electrical energy crisis in California.
5. The surprise is that Californians are surprised by the shortage of electricity.
WHY DIDN'T CALIFORNIA BUILD A SUFFICIENT ELECTRICAL SUPPLY?
Now we must ask why California's electrical utilities apparently have not been constructing generating capacity to keep up with growth of demand for electrical energy in California. Certainly, the high cost of purchasing new electric generators is a factor. So, let's look at some ballpark cost figures for building new electric generators.
THE COST OF NEW ELECTRIC GENERATORS
The purchase price of electric generators is something like $1 a watt. Coal plants may cost more, nuclear plants cost much more, while natural gas turbines cost perhaps half of this. Let's use $1 a watt as the basis for some very simple calculations. As a rule of thumb, the utilities report that they need about 1000 watts of generating capacity for one new person. This means that for every person that moves into the service area of an electric utility, the utility must spend about $1000 in capital costs for the purchase of new electric generators. (This is not for fuel and other operating costs, nor does it include the costs of expanding the electrical distribution system that conveys electricity to the consumers. This is just to purchase and install the generator.)
Add a million people to a population, and the utility must find $1 billion to spend purchasing a billion watts (One gigawatt) of new electric generators. The only place this $1 billion can come from is the customers of the utility.
By way of reference, I believe the largest single generating plant in Colorado is the plant SE of Pueblo that has a capacity of a little under one gigawatt.
COSTS OF ELECTRIC GENERATORS vs. POPULATION GROWTH RATES
Expressed in terms of growth rates, one can say that if the population of the service area of an electric utility grows by one percent in a period of time then, in that period of time, every person in the service area must pay 1% of $1000 as that person's share of the cost of the electrical generating equipment needed to accommodate the population growth that took place in that period of time. That's $10 for every man, woman, and child in the utility's service area! If the population of California is growing 2% per year, then every man, woman, and child in California has to pay something like $20 a year to fund the purchase of the needed new electric generating plants! (Note; financing costs are not included in this estimate. If bonds are issued to pay for a new generating plant, the total costs, including interest on the bonds, may double the total cost cited above.)
These numbers suggest one reason why, over recent decades, the electric utilities in California appear to have been reluctant to invest in the purchase of new electrical generating capacity. The utilities did not want to sock their customers with these high costs, or perhaps they were not allowed to charge these costs to the customers.
There are certainly other reasons for this reluctance that have to do with regulation, pollution, etc.
CONSERVATIVE MANAGEMENT
A few decades ago, I believe that the conservative management of electric utilities called for a utility to have about 20% more generating capacity than is required to service the peak expected load. This conservative management practice would allow a utility to have one of its generators out of service because of accident, or for maintenance, without there being any loss of service to the customers of the utility.
For whatever reason, it appears that the electric utilities in California have abandoned this conservative management criterion, and have let demand grow until the margin between maximum supply and peak demand is razor thin. The utilities have counted on being able to purchase needed peak power from neighboring utilities whenever they wished. Now it turns out that with de-regulation, purchasing outside power costs an arm and a leg, if outside power is available.
A QUESTION
Question: What has the California Public Utilities Commission been doing all these years when the California electric utilities have allowed their spare electric generating capacity (the excess of maximum supply over peak demand) to decline to close to zero?
WHAT DO WE EXPECT OF A PUC?
I know nothing of the laws governing the Public Utilities Commissions (PUC), but it would seem logical to expect that one of the responsibilities of a PUC would be to monitor and report on this aspect of the performance (the available capacity cushion) of the utilities for which the PUC is responsible. It would further be expected that if a PUC learned that one of its utilities was not keeping supply comfortably ahead of demand, and was not planning to keep the projected supply ahead of projected demand for the future, then that PUC should have the responsibility for reporting the facts to the state Executive and Legislative branches and to the public. If the reported situation continued to deteriorate, it would be expected that there would be strong executive and legislative remedies.
Without knowing events in detail, one is led to conclude that, quite possibly, the California PUC has been derelict in meeting its responsibilities.
In the present crisis, it is reasonable for other states to be asked to help California, but only if the Executive and Legislative branches in California have taken strong steps to correct the situation that the California officials have allowed to happen.
WHERE WAS THE U.S. DEPARTMENT OF ENERGY?
In any reasonable world the U.S. Department of Energy (DOE) would be monitoring the developments in the areas of energy supply and demand throughout the country and would be in the forefront of calling for corrective actions any time that projections showed that demand was growing faster than supplies. As far as one can tell, the California crisis seems to have caught the DOE by surprise.
OUTLOOK FOR BRINGING SUPPLY UP TO MEETING DEMAND
The California shortage of electrical energy will not be "solved" until there is, within California, or within the control of the California PUC, electric generating capacity of about 20% greater than the expected peak demand in California. This will undoubtedly require the construction of several gigawatts of electric generating capacity at a cost of several billion dollars. (A gigawatt of electric generating capacity will cost about a billion dollars and will serve about a million people) With zero population growth, the planning, financing, and construction of the needed electrical generating capacity could easily take five to ten years. If California's population growth continues, this will significantly increase the time needed to relieve the problem. So once you get into the California-style electrical energy shortage, there is no quick fix.
THE EFFECT OF A PROLONGED SHORTAGE OF ELECTRICITY
The high-tech world and the world of high-tech industries are totally dependent on a reliable uninterrupted supply of electrical energy. The present unreliability of the California electrical energy supply, and the long time it will take to remedy the shortages, could have profound effects on California's high-tech industry. One expected effect will be the migration of some of that high-tech industry to parts of the country with reliable electric power.
SUMMARY
Put in its simplest terms, population growth in California is probably the principal factor in the genesis of the present electrical crisis in California.
THE PROBLEM IN COLORADO
The U.S. Census reports released last week show that Colorado's population grew from 3,294,394 in 1990 to 4,311,882 in 2000. This is an increase of 1,017,394 people in a decade, and this corresponds to an average rate of about 2.69% per year. In this decade, we should have constructed about one gigawatt of new electric capacity, which would cost the ratepayers of Colorado about $1 billion. If we say the average population in Colorado in the decade was 3.8 million, then the cost of this needed construction of electric generating capacity would be $260, or $26 per year for every man, woman, and child in Colorado. I don't know how much new capacity was constructed in Colorado in the decade just past, but I would be surprised if one gigawatt of new capacity had been added to the electric generating capacity of the State.
There have already been reports that Colorado's population growth has caused a growth in demand for electricity that may soon exceed the available supply. Colorado could be one of the next states to experience a serious electrical energy crisis. It is therefore prudent to ask:
1. Do the Colorado electric utilities currently have a conservative margin of generating capacity of around 20% in excess of peak demands, so that one of the Colorado electric generating plants could be taken down for maintenance without disrupting Colorado's economy?
2. If the Colorado electric utilities don't have this needed margin, has the Colorado PUC been alerting the Governor and the Legislature of the impending excess of demand over supply, so that these bodies can take the necessary executive and legislative remedies to head off a crisis?
3. If the Colorado PUC has not been reporting this problem, who has the oversight responsibility for the Colorado PUC?
SELLING COLORADO CONTINUES
In spite of these problems which are caused by population growth, there are groups in Colorado, both governmental and private, that spend enormous sums of money each year in advertising, seeking to get more people and more companies to move to Colorado. We can predict with reasonable accuracy the increase in electric generating capacity that is required to meet the needs of any proposed increment of increased population, so we know exactly where we are headed.
Unless strong corrective actions are taken now, a California-style electricity shortage can be expected to cripple the economy of Colorado.
THE DOUBLE WHAMMY!
But there is a double whammy. The escalation of electrical demand is the major factor in the recent astronomical increases in the price of natural gas in Colorado. Some new electrical generating plants are being built in Colorado, but most, if not all, are gas turbine plants that burn natural gas. The enormous gas consumption of these plants is certainly a major factor in creating the shortages of natural gas that are responsible for the recent large increase in the cost of natural gas to heat our homes and buildings. As this is written, the news tells of a third large increase in natural gas rates that is being submitted to the Colorado PUC. The TV news has featured Colorado families that are very hard hit by these increases in the natural gas rates. So many more such news stories can be expected.
The population growth in Colorado is increasing our natural gas rates, and this can be expected shortly also to increase our electricity rates.
The benefits of population growth accrue to a few, but the costs have to be borne by everyone.
RECOMMENDATIONS
The electric utilities in Colorado should be required to keep, in Colorado, at all times, a conservative margin of generating capacity that exceeds peak expected demand by about 20%.
The utilities should be required to build coal-fired electric generating plants so that the remaining supplies of natural gas can be saved to heat homes and buildings in Colorado. The Wyoming coal fields are nearby and the Wyoming coal reserves are large. The coal-fired electric plants should have all the most up-to-date technologies for pollution control.
A good case can be made for calling for a moratorium on population growth in Colorado until the present residents of Colorado can be assured that electricity and natural gas supplies are adequate to supply the people of Colorado for at least a decade without further large increases in electricity and gas rates, and independent of events in other parts of the country.
POPULATION GROWTH IN THE UNITED STATES
The recently released U.S. Census figures show that the following population growth rates for Colorado and for the U.S. The world growth rate is estimated to be about 1.3% per year.
Colorado 2.69% per year
United States 1.24% per year
World 1.3% per year (estimated)
The United States sends foreign aid in the form of family planning assistance to countries that have smaller population growth rates than Colorado has!
The last U.S. President who was concerned about population growth in the U.S. was Richard Nixon, whose Rockefeller Commission Report concluded that they could find no benefit to the U.S. from any further U.S. population growth.
In spite of this warning, the population growth rate of the U.S. is approximately 1.24% per year. If Colorado's population growth exceeds 1.24% per year, then we are being asked to accept more than our share of the burden. Electrical shortages are a part of that burden.
CONCLUSION
It seems most urgent that the Governor and the Legislature address these electric generating capacity situations in the coming session. By being honest in assessing the problem, we may be able to find solutions that avoid the crisis that the governmental agencies of California have allowed to happen to the people of California.
With best wishes for the holidays, I am, Respectfully yours,
Albert A. Bartlett
P.S. By way of background, I have a Ph.D. in Nuclear Physics (Harvard 1951) and I have lectured from coast to coast on "Arithmetic, Population, and Energy" for over 31 years.
E-Mail: Albert.Bartlett@Colorado.EDU
Black Blade: Good synopsis. But destined to fall on deaf ears. There are more Kalifornian votes than Coloradan votes. The Grasshoppers are stealing from the Ants. This problem will continue to spread like wildfire uintil the whole country is consumed with this developing energy crisis. This could have been avoided, but alas, the Grasshoppers - "And they danced, sang, and played all summer..."
The article mentions (towards the end) the "Methow Valley".
For your readers, that's a hydro-power rich but somewhat
undervelloped as-yet area of Washington State (USA) which
is nearby the famous Grand Coulee Dam and Columbia River.
But all such developments, as your article vividly points out,
are year-n-years in the future. The only viable soloution that
can be quickly implemented (by GW Bush.?.) are, as before,
strict conservation-of-energy measures, nationwide.
As I posted some time ago, such measures were greatly and
quickly effective in the previous "unexpected" energy shortage
eras of the 1970's and 1980's. In fact, so effective that utility
companies reeled from the loss of their revenues as their
captive consumers cut back on electricity consumption. The
surprised utility companies were aghast, and retaliated by
RAISING their rates considerably, to keep from going into
bankruptcy.
An offshoot of the heavy conservation abilities of the public,
thwarted the massive WPPSS nuclear plant project and led to
its demise and the muni-bond defaults that burned several big
players in the Eastern financial sectors. It turned out that all
those WPPSS reactors weren't needed after all. Conservation
sufficed in lieu of 4 (count them -- four) full sized nukes.!.
All to the chagrin of the power-monger utility and construction
industries. Etc. Since that time, they have invariably *not*
pushed for any energy conservation measures whatsoever. So you can add those DumbClucks to your list of Grasshoppers.
Without re-enacting such measures, I for one, find it hard to
believe anyone is getting serious about the matter. As usual.
The Methow Valley, is that portion of the State of Washington
in the USA, that forms the watershed of the Eastern Slope
of the North Cascade Mountains. It's in "Central" Washington,
the Northern third. Stretching roughly from a point 50 miles
North of Chelan, where the Okanagon River joins into the
Columbia River. Grand Coulee Dam is on the Columbia. Then
the next biggie is Chief Joseph Dam. near there. The Methow
Valley extends Northward past Omak, which is home to the
world renown "Omak Stampede" and Sate Championship
PowWow. Following the Okanagon River, all the way up into
adjoining BC (British Columbia) Canada, to Penticton, BC.
It's a richly endowed fruit orchard area, as well as pristine
wildlife areas such as the North Cascades Wilderness.
All along the Eastern riverbank is the Colville Indian
Reservation, home of the Confederated Tribes indigenous to
that historic region. Indeed, "Okanagon" is an Indian word that
translates (roughly) to:
"Not In My BackYard, Whiteman".
Some would say, more accurately:
"Not in My Eagle's BackYard, Bimbo".
Hydro-Electric development in that Valley would run afoul of
many groups: Fruit Growers; Farmers; Sportsman; and Fish
enthusiasts and Conservationists of every imaginable psyche.
And too, would create (more) disarmony with Canadians when
the inevitable Dam(n) Reservoirs would backup and inundate
their portion of the region. Similar to when Ross Dam, on
the other side of the Cascades was deemed raiseable, much
to the annoyance and disgust of Canadaians. It provoked an
international incident and resulted in favorable power-sharing
treaties between The Sate of Washington; Seattle City Light;
and the Province of BC. Perhaps the UN also got involved.
In any event, the Methow Valley would not support such high
Dams as Grand Coulee, etc. Instead, just many low Dams
and that wouldn't create much Electric Power. At least, not
enuf to satiate California.
It's far better to build another nuke or two, in their FrontYard.
...from a fan.
For what it's worth.
Oh... And bye the way... There's alot of Gold in the mountains
there, and it all washes down thru the Methow Valley.
Which would you rather have.?. Gold.?. Or Electricity.?.
I remember the WPPSS(?) fiasco, how appropriately named - "Whoops." However, I bet that they wish they had those nukes now, as the Grasshoppers are draining away power to the Peoples Socialist Republik of Kalifornia." The problem with the nukes was that there was a lot of political opposition with all the usual accompanying lawsuits and delaying legal tactics that continually added to the costs. Eventually, this resulted in the bond defaults. There were several issued and only a couple of issues defaulted. As I recall, Warren Buffett bought several million dollars worth of bonds at a deep discount and did very well. The people of Washington had to cover the cost of course.
We've finally come to the point where energy conservation alone is not enough. The so-called "New Economy" requires massive input of energy - despite claims by the ever optimistic Wall Street crowd that energy is no longer important as it once was. Just ask the Grasshoppers how unimportant energy is as they open their utility bills. This should be very interesting as we move forward with a growing population and ever increasing energy demands. The "Bull Market" that Wall Street enjoyed over the last few years was "piggy-backed" on cheap energy. Those days are over forever. I would suspect that at some point, even nuclear energy will be in demand as it is in Japan and Europe. It is politically a "Hot Potato" right now, but with a few cold winter months and many dead as a result, and add a few deaths from summer heat as has been the case over the last couple of years, then it is quite conceivable that there will be a nuclear and coal power plant boom. We are certainly in for some "interesting times."
BTW, I don't have a SUV, but I do have a couple of 4X4 pickups, a necessity where I live. I often must travel on jeep trails, washed out roads and break trail through snow drifts. It comes with the territory. Cheers!
RE: ThaiGold - The Grasshoppers have tried it all before
You may remember that Kalifornia had attempted to pass legislation in DC to secure water rights from the Snake River in Idaho a few years ago. They had a drought at the time, and some in Kalifornia pointed their greedy paws toward the Snake River and even talked of taking Columbia River water as well. I guess that is what happens when people build cities in a desert (southern Kalifornia). It was the environmentalist in Kalifornia that put the kabosh on that idea. They seem to have been getting away with it to some degree as far as this energy mess is concerned. These little tid bits of information demonstrate the lazy self-centered Grasshopper mentality of those in Kalifornia. "And they danced, played, and sang all summer�"
Environmentalists were the smaller part of it falling thru.
There were two bigger factors:
(1) the Late/Great Senator Warren G. Magnussen of the
state of Washington. He singlehandedly sneaked a rider
ammendment onto an unrelated minor piece of routine DC
legislation that forever kiboshed any attemppts to siphon away
the waters of his state. He was was very powerful, and had
much seniority. Nobody, NOBODY in Congress dared to not
sign off on that Legislation. Even California's law purveyors.
(2) It was economically/physically ludicrous. The intervening
mountain ranges would have been insurmaountable (no pun)
and would have required such massive (energy hungry) pumps
that made it totally infeasible.
As with everything-Kalifornia, during the time I lived there, they
had incessant qwater shortages. Yet nobody bothered to
conserve one iota. They GrassHopped merrily along every day
watering their extensive lawns, shrubs, and washing thier cars
every day. Sometimes twice a day. And water was also the
tool of first resort to hose down their sidewalks and driveways
every day.
Mild conservation efforts were tried. People were asked to do
their hosing and watering only on odd/even numbered days,
depending upon their street address. P.O. Boxholders exempt
of course.
As an aside, now the Fish Enthusiasists are harping to get
many of the Hydro-Electric Dams along the Snake and
Columbia rivers REMOVED. Torn down. Demolished. Why.?.
To allow for the unimpeded salmon migration/breeding runs
to replenish. Of course that's a laudable cause, but some
simpler/better fish-ladder concepts could suffice instead.
As for me, I cannot afford the price of Salmon nor Electricity.
This is all coming to a logical conclusion for Precious Metals
investors ("investors"). We must begin thinking about selling
off all our holdings, and instead invest in Energy forms.
How about little 1/oz bottles of LNG for starters.?.
I remember that effect (the electric companies attempting to get customers to use more power.) If you didn't look closely and know what to look for, you missed it!
By far the best energy conservation measure that can be implemented is to get out of the way and let the price of scarce resources (actually ALL resources) be set by the (relatively free) markets.
When prices go up, people who don't even know what's going on (because they don't read USAGOLD) "conserve" when they discover only one thing: "This product costs more."
Re: California governor begs Clinton's aid on supplies @Black Blade #45670
QUESTION: What's wrong with this picture?
ANSWER: All the folks mentioned in the article are politicians and bureaucrats, folks who not only don't produce any gas or electricity, but most don't even know how it's done.
On the other hand, since they create the lion's share of our problems, maybe that's appropriate. If only they'd undo the rules, regulations, orders and controls that caused the problems - - - but is that really what politicians and bureaucrats do?
How the world !!........ last paragraph last sentence
The special drawing right (SDR) is an international reserve asset created by the International Monetary Fund to supplement existing reserves. It is valued on the basis of a basket of five currencies and can be used in a wide variety of transactions and operations among official holders.
The Second Amendment of the Articles of Agreement, which became effective April 1, 1978, considerably enhances the role of the SDR and requires participants to collaborate with the Fund and with each other to make the SDR the principal reserve asset in the international monetary system. To this end the SDR has been given increasingly attractive features in terms of yield and liquidity, including a wider range of uses. The scope of operations and transactions in SDRs by the Fund itself has also been enlarged. In addition, the Fund has been given the authority to prescribe (or permit) operations in SDRs not specifically mentioned in the Articles.
http://www.usagold.com Interesting factoid in fridays Wall Street Journal. Natural Gas is used in the production of nitrogen for fertilizer. Costs are going up to plant crops. Natural Gas, like oil,will cause a future inflation shock just like increased oil prices due to the energy cost that is on almost everything.
BTW,refinancing boom is starting. I can see it by the amount of work coming into my office. That,too, bodes future inflation since it is another way money is added to the economy.
"since they create the lion's share of our problems, maybe that's appropriate. If only they'd undo the rules, regulations, orders and controls that caused the problems - - - but is that really what politicians and bureaucrats do?"
Of course not. What they do is obtain their living (omission of the word �earn' intentional) by the symbiotic relationship with an ethically degraded population that uses the workings of the democratic process to play the game of "I vote to tax you."
This society has become a nation of freeloaders who use the power of government to force charity and support to be delivered from the producers of goods and services to the various segments of the indolent, the incompetent, the foolish and the greedy.
It is now, regulate--counter regulate, ad-infinitum. Only when they "Break the bank" will there be enough of a reality check to reverse the tide. Meanwhile as Ayn Rand said about Atlas, saddled with the weight of the World on his shoulders: "Shrug"
At no other time in its recent history has the gold industry so grasped the opportunity to take control of its own destiny. AhHaaaa, well, well, well !
While detractors point to the continued selling by central banks as confirmation of the commodity's declining importance as a global monetary reserve, there is a growing train of thought that suggests that central bank sales could be a blessing in disguise, for they have challenged, producers and suppliers are looking to increase efficiency and work harder both to promote their product and find new markets for their commodity.
...a blessing in disquise... ??? OK, keep on selling ...sorry, blessing us.
This has led to consolidation among mining companies with more mergers expected in the months ahead. Industry analysts predict a future in which the industry will coalesce to 5 or 6 major producers controlling around 70-80 percent of the market. This will help to deflect criticism that the current fragmented nature of the industry has hampered the ability to attract the generalist investor, a element upon which the future financing of this industry increasingly depends.
Concentrate the producers oligopoly, as to control and dominate the future production in function of a much higher price...OK, thanks. No GoldPEC possible with to much fragmentation ? Lease-rates 1%/1,5%...do you really need a shareholder/investor ?
In its bid to increase efficiency, the industry has harnessed the potential of the internet. New ventures such as Gold Avenue and Atlanta based InterContinental Exchange will provide exciting new means for trading and advertising gold to its consumers.
In the jewellery markets, important new initiatives such as branding, alliances between producers and jewellery manufacturers, and a new spirit of cooperation between manufacturers and bullion banks are underway. All should increase sales to consumers and lead to a more streamlined industry where gold's miners, refiners, distributors, brokers and promoters work much more closely to promote the future integrity of their product.
...BB's and manufacturers : come closer to me, so I can see...lalaladila...
But future success is not yet guaranteed.
Who in the future will benefit from the consolidation currently underway? What are the implications for suppliers? And how might shareholders and investors be expected to view the new developments?
Is too much emphasis being placed on the trader's and the consumer's willingness to trade and buy online? What are the consequences of these new developments for the 'Gold value chain' and for the players - the bullion bankers, jewellery retailers - on whose livelihood the existing structure so depends?
To discuss these and other vital issues facing the sector, the gold industry's new internet pioneers, leading voices from the jewellery markets of South Africa, the USA and India, leading bullion bankers and investors will meet in Rome to present a comprehensive briefing on the world of gold today.
The more explicite cooperation between Anglogold and Bullion Bank(s), is catching my attention. The numero uno in the goldproduction-fragmentation " 36% hedged " and the price-fixer(s)...so closely together. Yep...oh-li-go-po-lyterrittetti.
So far, no mentionning of the attendance of the Swanepoel's
and other non hedgers. Gonne dig a bit deeper into this conference stuff.
This week the OECD's phony attack on tax havens suffered a major setback has that notorious G-7 front group was forced to back down from its high handed demands at a meeting Barbados. OECD minions were forced to accept creation of new a joint task force including both OECD and tax haven
nations, giving blacklisted nations "a seat at the table" and a forum for their complaints and defense.
Faced with a new unity and staunch opposition from offshore havens at the meeting, the OECD suffered defeat of a proposed "Memorandum of Understanding" calling for punitive measures if blacklisted nations failed to improve "transparency" in financial operations, including
agreements to exchange tax information by OECD set deadlines. The document and deadlines were rejected by haven nation delegates as offensive, impractical and a violation of their national sovereignty.
The offshore havens complained that major OECD members, especially the US and UK, are guilty of behavior far worse than they, including tolerating money laundering and tax evasion. Prime Minister Owen ARTHUR of Barbados forcefully led the anti-OECD opposition. Terepai MAOATE, prime minister of the Cook Islands, summed up havens' scorn of OECD demands, calling them "discriminatory and destructive" against small nations.
Andrew QUINLAN, president of the Washington, DC-based Center for Freedom and Prosperity saw "the OECD's concession as a remarkable victory for those who believe in fiscal sovereignty and financial privacy." The CFP has been the leader in organizing anti-OECD opposition, holding a series of meetings in Barbados to solidify a common haven stance.
The new joint task force will meet in advance of an OECD forum next month in Tokyo. The battle goes on, but a significant skirmish has been won by offshore financial freedom fighters. Taken together with the change in government in Washington, the offshore tide may be at
last turning.
As we look back into the history of our race, we find one of the things most desired was the ability to fly. Even before structured language, cave paintings and petroglyphs displayed this facination.
By attaching baskets to tethered as well as free ballons, and finally building cabins into monsterous gas envelopes the desire was realized. Thus by first discovering and then learning to manipulate the laws of physics we could sour into the clouds and even cross oceans.
The Hindenburg disaster was perhaps the first of many examples to dramatically drive home the fact that we conquored neither the laws of physics, nor gravity. Our machines allow us very rapid transport, have taken us into orbit around our planet, and to the moon.
However, when we ignore the laws, or when something upsets the plans'schemes, and designs inherent in our manipulations, we can can and do expect some very unpleasant reprecussions. There may be a million gallons of fuel only 10,000 feet below, but when a plane engine consumes the last drop of fuel immediately available, we All accept the fact that NO POLITICAN ON THE PLANET CAN COUNTERMAND THE LAWS OF PHYSICS.
How then can so many of us be brainwashed to believe that some self important politicians can countermand the laws of supply and demand?
I will not come and claim certainty in any calculation of gold quantities available to the market, there is no way we will know what the actual numbers are.
The question is that of ball park figures - a world of 140,000 tonnes, or a world of 1 mil tonnes +/- 50%. I am tending to believe in these worlds in various degrees of probability.
The "official" numbers are calculated from reported information with minor adjustments for unknown numbers that can be interpolated. Thus the possibility of their capturing real gold production over periods with little or no records, or dealing with deliberately falsified records is in question. The accuracy of an attempted accounting of the above ground gold stock is by necessity a function of the degree of certainty in the components counted. If one wants easy to defend numbers then the total of well documented gold is going to understate the actual total.
In a world where secrecy is highly valued, documented stockpiles and production will be the minority rather than the majority.
When looking at WGC totals for production values and demand, it is immediately obvious that demand would be understated in the official reporting from customs. How trustworthy are customs reports of estimated drug smuggling?
The "official" data can only be viewed as a baseline minimum for actual numbers. The question is then how far above these "official" estimates would the actual numbers be.
Whatever number comes out of any research project on gold, whether using Mr Guyatt's documentation or any other, will certainly leave many quantitative questions unanswered. The quantities may be coded just as the names are, though Mr Guyatt has not put the stated numbers in question.
The "hole" in my estimation of the rates at which financial and economic resources are "taken off the table" by their owners is neatly plugged with Mr Guyatt's numbers. Timing of the deposits, which seem to be unallocated (since some are stated as lent out), coincides with major changes in gold prices over similar periods when gold prices dropped over the 70s and 80s.
The supply of actual gold, not only paper gold, relative to dollar denominated debt had to substantially greater than "officially" stated, else the system would have collapsed long ago as a result of over-leverage.
There were the revelations of the existence and then the official admition of the London Gold pool of the 50s and 60s, then a period of open gold sales by the IMF and the US. Up till the early 90s only insiders knew of over the counter derivatives issued by banks and investment houses and not reported on their books. These were released to the public in data collections from various government related financial statistics only over the last 8 years. The portion of "off the books" gold derivatives reported does not include plain gold deposits, which remain off the books.
The LBMA was shrouded in mystery till 1997, when its trade volumes and closings were reported. Daily trade that is netted out without actual transfers is still not reported.
Should one wait till the beans are spilled officially in trying to estimate how many beans there are, who has them and how likely they are to spill?
Where information is hidden, the reason can be as simple as an understandable desire for privacy, but also a different set of reasons may play a role. In the form of a fraud perpetuated ad nauseum and repeatedly over financial history, gold banking is the one source of secrecy that should always raise eyebrows. The secret, on the part of bankers, is how much leverage is heaped on miniscule gold reserves, and on the part of sizeable holders of physical metal, it is how much metal is there. During periods of shortage, bankers would be expected to present a picture of heavy gold supply, just as would the holders of hoards wishing to expand them. Only when no more gold is coming in to the hands of accumulators and banks can no longer keep up the charade (which has to occur at the same time), then it is in the interest of holders to publicize scarcity.
If true values are inadvertently disclosed during the publication of the existence of greater supplies than popularly believed, "taking it back" - promoting the view of scarcity later on, becomes more difficult. Thus attempts would always be made to make source documents appear doubtful.
We have been speaking for some years of a period of shortage, particularly made obvious by the expansion of reported paper gold, therefore, it would stand to reason that this would be the time when interested parties in banking and among hoarders of size would come out with disclosures of information as to the amounts of gold available, thus a revelation of the kind made by Seagraves and others (including Mr Guyatt) is simply not quashed as it would otherwise have been before. However, the internet makes a difference here, as information is treated with more scepticism on the one hand, and with more evidence available for anyone interested in coming to a conclusion, it is more difficult to change "the facts" being considered by us little guys.
This comes down to how far one integrates understanding in a coherent manner with "facts". Our noses are sensitized to sniff what smells different from our current environment. Thus what a newcomer will smell would be quite different from what natives would. Same goes for informational environments. If you want an idea of what your informational environment is like, you need to go away from it and come back with closed eyes and open nose and put down in writing what you smelled upon entry.
A fairly large buffet in West Palm Beach, Florida, that I go to quite frequently just raised their prices across the board by 11% - everything. One of the assistant managers scratched his head in puzzlement over this. Said to me as if asking a question, "Customers not as much as they used to be, so they raise prices?"
"A scarity of something that has just been the source of a crisis is not going to make that item (the modern US dollar) go up in value."
HBM Comment:
I found that statement rather remarkable in the simple truth which it conveys; however I do believe that a rephrasing would give it all the more power:
A scarcity of something for which there is no demand will not make that item go up.
You could make a case of this concerning the present state of the physical gold market. Scarcity is not the problem at all. Relatively speaking there just is no demand for it. There has been much talk about the number of tons of above-ground gold in existence. I do not think a few thousand tons give or take is the problem. Relative to world population there is not much gold to go around. Supply is not the problem. Demand is the problem. What must happen is a power shift in your old basic demand curve, caused by preferrence alone. It will happen and when it does even 10 thousand tons will not satiate the demand.
Let's say you had a very wealthy Uncle that would back you to the tune of 2Billion US$, in order for you to participate in the paper gold markets. You decide to participate in these markets "at the margin" and thus exert a strong influence on the entire gold market with this amount of funding. If you were to actually lose this money your Uncle would not be too upset and could possibly even replace the funding for you to try again.
Can someone "quantify" this $2B in relationship to {mainly} the Comex Market so as to help explain what amounts of money are actually necessary to have this strong impact on Comex Gold? What is overall $ amt traded on daily Comex gold? Is there ANOTHER way to look at this question in order to arrive at a reasonable answer to what can be accomplished with $2B? Anyone want to take this concept and run with it?
I'm am vagly familiar with the nuclear power plant program primarily because of the animosity it caused as the result of the continueing cost to the utility customers of Washington state to pay off the bonds.
I was talking with a man a couple of days ago whose occupation apparantly requires his presence at the Hanford reservation periodically, as well as other nuclear facilities from Washington to California. He told me that one of the four reactors built was completed but had never been on line. He said there was also a complete nuclear research facility if believe at Hanford that had never been used.
http://www.ivcybermall.com/book/There is an outline of another book about the Marcos gold in the Phillipines. I found it quite interesting.
For example, I didn't know that before France fell to Hitler, France shipped their national treasure to Indo-China. The Dutch shipped theirs to the Dutch East Indies (now Indonesia), and Churchill and the King of England decided to ship theirs to Singapore. (At that time thought to be impregnable.) Another thing Dan Rather must have overlooked was that Imelda Marcos got out of going to prison by releasing 72,000 metric tons of gold stored at Fort Knox. What a planet...
H.B.M., I concur 100% with your thought that POG needs some demand. Supply and Demand (ying and yang) are the engines but of the two, Demand is the stronger. It's hard to get a good, substantial irrational exuberance much less a totally insane investment mania off the ground without out-of-control demand. Gold.com here we come.
When gold is $800/oz, will its P/E ratio be too high?
Will we have to listen to people pine for the good old days when a good starter house was only half a million, a cup of coffee was $5.00 and an ounce of gold could be bought for only $1200??
Hope so Rich
The problem that has you 'perplexed' is caused by you attempting to confuse two disciplines � one, physics, being a true science, and the other, economics, which is not.
Academia, as it stands, has classified economics, like psychology, as a science subject, but unlike a true science, they are based on theory and not empirical study.
Economics, like psychology is therefore subject to the vagaries of the human mind, and, consequently, behaviour.
It is true that some economic theories, through time and their apparent response to cause and effect, have become accepted as �laws�, they are still theory.
I am having problems getting back there myself. I did bookmark the site while I was there. The bookmark still works fine, but I can not type in the address and go there.
In my original post I forgot to put in the title and author. They are: THE GOLD OF THE SUN, the author is Mark O'Brien. The copyright is 1996.
In a different but similar vein; I've had trouble ordering acopy of THE SECRET GOLD TREATY. In addition to that, I've gone to some of the sites mentioned in David Guyatt's book and had trouble navigating there. I could never seem to get to where I wanted to go. I havn't gone back there since. Later...
http://www.gold.org/Gra/Gra1.htmWorld Gold Council
World Official Gold Holdings (January 2001)*
Ranking -- Country -- Metric Tonnes -- Gold� s % share of reserves**
====================================================
1 United States 8137 -----56.4%
2 Germany 3469 -----35.2%
3 IMF 1) 3217 ----- n/a
4 France 3025 -----40.9%
5 Italy 2452 -----44.6%
6 Switzerland 2) 2434 -----40.9%
7 Netherlands 912 -----44.1%
8 Japan 764 -----1.9%
9 ECB 747 -----15.0%
10 Portugal 607 -----38.0%
11 Spain 523 -----12.6%
12 United Kingdom 488 -----9.2%
13 Taiwan 3) 422 -----3.2%
14 China 395 -----2.1%
15 Austria 377 -----18.7%
16 Russia 4) 377 -----11.9%
17 India 358 -----8.6%
18 Venezuela 4) 319 -----16.8%
19 Lebanon 287 -----29.5%
20 Belgium 258 -----18.4%
21 Philippines 222 -----13.0%
22 BIS 1) 203 -----n/a
23 Sweden 185 -----9.7%
24 South Africa 182 -----20.5%
25 Algeria 174 -----12.5%
26 Libya 144 -----10.4%
27 Saudi Arabia 143 -----6.7%
28 Greece 132 -----7.3%
29 Singapore 5) 127 -----1.1%
30 Turkey 116 -----4.0%
31 Romania 105 -----18.8%
32 Poland 103 -----3.6%
33 Indonesia 96 -----2.9%
34 Australia 80 -----3.7%
35 Kuwait 79 -----9.9%
36 Egypt 76 -----4.7%
37 Thailand 74 -----2.0%
38 Denmark 67 -----3.9%
39 Pakistan 65 -----34.9%
40 Brazil 4) 57 -----1.6%
41 Kazakhstan 57 -----21.3%
42 Finland 49 -----5.5%
43 Slovak Republic 40 -----7.8%
44 Canada 37 -----1.0%
45 Norway 37 -----1.6%
46 Malaysia 36 -----1.1%
47 Peru 34 -----3.3%
48 Uruguay 34 -----10.3%
49 Bulgaria 32 -----8.5%
50 Bolivia 29 -----25.1%
51 Syria 1) 26 -----n/a
52 Morocco 22 -----3.9%
53 Netherlands Antilles 17 -----44.0%
54 El Salvador 15 -----5.9%
55 Cyprus 14 -----6.5%
56 Czech Republic 14 -----1.0%
57 Ukraine 14 -----10.7%
58 Korea 14 -----0.1%
59 Ecuador 13 -----9.8%
60 Zimbabwe 13 -----37.0%
61 Jordan 12 -----3.1%
62 Colombia 10 -----1.0%
63 Oman 9 -----4.1%
64 Ghana 9 -----24.3%
65 Mexico 8 -----0.2%
66 Latvia 8 -----7.2%
67 Myanmar 7 -----18.5%
68 Tunisia 7 -----4.2%
69 Guatemala 7 -----3.2%
70 Lithuania 6 -----3.9%
71 Ireland 5 -----0.9%
72 Mongolia 5 -----19.8%
73 Nepal 5 -----4.3%
74 Bahrain 5 -----2.7%
75 Macedonia, FYR 3 -----5.1%
76 Albania 3 -----8.0%
77 Bangladesh 3 -----2.2%
78 Hungary 3 -----0.3%
79 Aruba 3 -----10.6%
80 Kyrgyz Republic 3 -----8.7%
81 Luxembourg 2 -----21.5%
82 Chile 2 -----0.1%
83 Hong Kong 2 -----0.0+%
84 Sri Lanka 2 -----1.4%
85 Mauritius 2 -----1.8%
86 Iceland 2 -----4.0%
87 Trinidad and Tobago 2 -----1.2%
88 C�te d� Ivoire 1 -----2.5%
89 Armenia 1 -----3.7%
90 Paraguay 1 -----1.3%
91 Senegal 1 -----2.2%
92 Honduras 1 -----0.4%
93 Qatar 1) 1 -----n/a
94 Argentina 1 -----0.0+%
95 Mali 1 -----1.7%
96 Dom Republic 1 -----1.0%
97 Burundi 1 -----9.8%
98 Togo 0+ -----2.8%
99 Mauritania 0+ -----1.1%
100 Benin 0+ -----0.6%
101 Burkina Faso 0+ -----1.4%
102 Niger 0+ -----1.0%
103 Malawi 0+ -----1.3%
104 Estonia 0+ -----0.3%
105 Malta 0+ -----0.1%
106 Yemen 0+ -----0.1%
107 Georgia 0+ -----0.5%
108 Costa Rica 0+ -----0.0+%
109 Maldives 0+ -----0.4%
110 Haiti 1) 0+ -----n/a
111 Fiji 0+ -----0.1%
112 Slovenia 0+ -----0.0+%
============================
Memorandum
All countries 28,824 -----12%
Institutions 4,167 -----n/a
World 32,991 -----12%
(Euro-System) 12,427 -----31%
(WAG signatories) 15,534 -----29%
==================================
NOTES
* Data from the International Monetary Fund's International
Financial Statistics, online January 2001 edition and
other sources where applicable. IFS data is two months in
arrears, so holdings as of November 2000 for most countries,
October or earlier for late reporters. The table does
not list all gold holders: countries which have not reported
their gold holdings to the IMF in the last six months are
not included, while other countries are known to hold gold
but they do not report their holdings to the IMF. Where
the WGC knows of movements that are not reported to the
IMF or misprints, changes have been made. The countries
showing as having 0 tonnes of gold report some gold but
less than 0.5 tonnes to the IMF.
**The percentage share held in gold of total foreign reserves,as calculated by the World Gold Council. The value of gold holdings is calculated using the end-November gold price of $269.10 per troy ounce (there are 32151 troy ounces in a metric tonne). The value of other reserves is from IFS, table �Foreign Exchange and Total Reserves minus Gold�
------------------
Footnotes --- #)
1. The BIS and IMF do not have easily comparable other
foreign exchange holdings. Syria, Papua New Guinea,
Qatar and Haiti have not reported foreign exchange holdings
to IFS in the last six months.
2. Switzerland began its sales of up to 1300 tonnes on May
The latest 10 day return (December 30th) from the SNB
shows gold holdings of 34.72bn Swiss Francs, which is equal
to 2,422 tonnes at the current national valuation of 14,335Fr per kilogram.
3. Taiwan is not a member of the IMF, but publishes com-parable data. It can be viewed at:
http://www.cbc.gov.tw/economic/statistics/fs/p2.xls
4. Excluding gold out on swap.
5. The Monetary Authority of Singapore does not publish
its gold holdings in the IFS, but they are available as part
of the IMF� s Special Data Dissemination Standards (SDDS).
See: https://secure.mas.gov.sg/dataroom/index.html
=====
<;-)
@barnacle bill - AllFrench gold to Indochina? Dutch gold to Dutch Indies? British gold to Singapore?
Pretty hard to swallow. To my knowledge most British and French gold has been shipped to the USA to pay for war supplies. It was dubbed " Cash and Carry " and had to be paid in gold. Not in paper. Also French had a sizeable amount of gold with their Caribean war fleet. I don't remember the amount but it was several hundreds tons. That gold has been seized by the USA once France fell to the Germans.
Also, to my knowledge, Belgian, Dutch, half Swiss reserves and possibly Norvegian gold have been shipped to the USA. For safe keeping.(?) This is why they are selling their gold today. Because they can't get it back. This was a cause of contention between De Gaulle and the USA because he was flooded with paper dollars and he wanted his gold back instead.
You are not compelled to believe me. Just note that the amount the Swiss are selling now is almost exactly the same amount sent to the USA in 1938 for safe keeping. I don't have these informations on hand any more or maybe they are buried somewhere in my library. The sources were credible. I remember also very well when, in the 1950's, $500,000,000 of gold was shipped from Germany to the USA. At $35/oz that was 14,285,714 oz or 444 metric tons. This was published in the large-circulation newspapers at that time.
@All
A black market means that you have a scarcity of a given product. Be it gold or potatoes, when you buy in a black market you pay the legal price plus a premium that could be several times its fixed value. To say that a black market depresses the value of a good is turning that logic upside down.
"Whoops" became the accepted way to pronouce the acronym "WPPSS"
which stood for "Washington Public Power Supply System", back in the
1980's when it was conceived as a government boondoggle to spend
the taxpayers money on constructing five nuclear power plants to
alleviate a contrived electricity shortage. They justified the
program based upon false assumptions of future energy needs of the
Pacific Northwest, and, discounting the unexpected windfall of
the public's ability to actually conserve/cutback electric use, the
plants were soon engulfed in myriad environmental and economic
controversies and litigations. And found to be unneeded in the first
place. That's atypical of the Washington State old-boy-network of
Bond-n-Spend to build anything and everything imaginable to create
jobs, and fleece future generations. It continues today, even as we
see Seattle demolish their highly needed "KingDome", to make way for
the latest unwanted project, the SAFECO Stadium. Ad nauseum. Betweeen
those two boondoggles, the City of Seattle managed to build an
extensive underground tunnel network "for bus-transit", and then
proceeded to leave 90% of their buses at street level to continue
clogging normal traffic. That project cost zillions and solved
nothing, just like WPPSS's five pie-in-the-sky nuclear plants:
Of those five planned nukes, only one was ever completed as a fully
licensed operational nuke. It was mired in cost overruns, and the
usual exhorbitant over staffing and wasteful overhead of any govt
run entity. Each planned nuke was given a name: WNP-1 thru WNP-5.
WNP-2 is the one that finally went online as nuclear. WNP-5 (?) was
nearly completed, but never licensed to go nuke. Eventually it was
retrofitted to burn natural gas instead, and went online as such.
WNP-1,3,4 fell by the wayside in various stages of partially built.
WPPSS itself vanished, as their muni-bonds collapsed and gave the
State of Washington a poor bond rating for many years after. The
physical assets (WNP-2 and WNP-5) were restructured into a quasi
public/private outfit named (I guess): "Energy Northwest" as a
consortium of 13 public utility electrical providers in Washington
State.
Their website is at the WNP-2 site: http://www.WNP-2.Com
WNP-2 is in Eastern Washington, near Richland, nearby the US Govt's
"Hanford" nuclear reservation, now a badly mismanaged nuke-waste
disposal boondoggle by the US Energy Dept. All good neighbors.
WNP-5 is (I guess) the one in Western Washington, (now natural gas)
located near Satsop. Satsop is an Indian word translated to:
"Not in My FrontYard, Honky".
To answer your question about the large research facility, I believe
it would have to be that known as:
"The Applied Process Engineering Laboratory (APEL)" and has a website
at: http://www.APEL.ORG
For further research about WPPSS, if you're interested, goto
http://www.google.com [a search engine] and type in WPPSS. It'll
give you 1,754 further sites to learn everything you didn't want to
know about WPPSS.
You've succinctly put almost the whole hypothesis of market manipulation for the sake of national dollar defense. Call it the "Greenspan (or Treasury) Call." If gold shoots up, you can get a refund in some form from us. Heads you win, tails break even.
And it is one of the cheapest "expenses" in their bag of tricks. The actual cash gold market is so small, and paper players so "jumpy" at the margins, that the mildest of steady pressures downward suffices. Bond and money market players "follow the Fed" in everything else; why not this, even if they don't specifically know of an official hand on the market scales. There used to dealing in many hints, too.
We're still dealing with markets here, however manipulated, so:
The only other (non-govt) explanations would be: (1) Players actually think gold shorting is a good free-market risk/reward. (HUH?) or (2) a near-bankrupt player(s) are already in too deep and so why not pile on more as long as they have available cash to buy time (maybe hoping they're judged TBTF), acting in a small market perhaps with nearly the heavy weight of a govt proxy.
But why wouldn't other non- or less-bankrupts call the bluff and drive them under, taking their business away? Might sink the whole system, themselves included? Or outside penalties from, again, a govt entity? Maybe they're all trying to figure out where dry ground will be in a general meltdown?
Only example I can think of from real business is when the bankrupt Continental Airlines started fare wars with $99 cross-country (one-ways) and got complaints from other carriers who still had to pay their bills and bond payments. CO had a "clean slate" head start, at least for awhile.
The lack of intra-day/week/month volatility, except for two spikes, is what seems so hard to explain by normal market behavior. Just the steady, flat pressure mildly downward: cheap, and effective. Keeping the lid on, while offering a small but guaranteed profit to the shorts.
The biggest evidence without a signed confession is the market action itself, sideways flat as above, and the spikes. Notably the WA one when the only player bigger than the UST/Fed chimed in saying "Game's up!" ECB scared some big money in just a day or two. That wasn't us "Little G-bugs" but some "Giants" worried about getting caught between two elephants they expected to start battling immediately.
They watched it so closely, and were utterly caught by surprise, it fired the market overnight. The window we had into the process by FOA & Another was the nearest explanation for that market action.
FOA is next looking for the paper markets to collapse. Perhaps dribbling down in volume first, as the shorters aren't so sure the Fed can put out so many fires and still make pay off their (off-market) call.
It's just that as long as you can use the public money of millions of taxpayers to back up your preferred market positions, why, you can hold on for a danged long time! Until you can't anymore in that market, or the flood's risen so high elsewhere, there's no point maintaining that particular charade. Nature of a rearguard action -- usually one unit (Fed/UST/dollar/bonds) is sacrificed to permit the "valued" units to get away.
Thank you very much for taking the time to fill in some blanks. We left in 74 and did not return until 89 and was not aware that the project had produced anything near completion.
Having lived in the Seattle Area for a number of years I am aware of the problems, the terms,and the fact that it is virtually impossible to get two people to agree to anything, this has been going on since at least 1966 when I first saw the place.
When the Kingdom was proposed they hired a consulting firm from, I think Minnesoto, and they recommeded placing the stadium between Seattle and Tacoma, because as they said they could invision I 5 as a parkinglot between Seattle and B.C with events occuring simultaniously at the Needle, Civic Center and Husky Stadium. They could also see people fying into Seatac and then being trasported to the stadium with light rail, as now happens with the United terminal at Seatac. This in addition to the fact that the property could have been purchased by the acre rather than the sq. ft.
This was not what the "good old boys" had in mind, they paid them, cast doubts upon their credability, and saw them back to the airport.
We moved east in 99 after the referendum pasted to install
mono-rail. If anyone thinks the traffic is bad now, just wait until construction begins on this.
re "To say that a black market depresses the value of a good is turning that logic upside down."
In the case of Gold, the "Black Market" is referring to the aspect of trade outside of government knowledge. It is not a circumventing of rationing a scarce or tarriffed product but a hiding of wealth and capital gain (or stolen goods) from the authorities. This unrecorded gold can nevertheless be sold openly wherever a seller does not have to show proof of where they obtained it.
Given this is true to the degree of quantity believed to exist by the theory's proponents, it represents an additional supply that can come to market as holders wish to convert to cash.
This possibility puts the calculated global short position in doubt along with the possibility that the influx of this gold into the physical market is also (along with the "contract" supply) a factor in the declining POG.
Attn: PerplexedHi Perplexed
Passed a Referendum for more Mono-Rail.?. Oh my gosh. I'd
not heard about that one. From where.?. to Where.?.
Sheesh.
The demise of the KingDome was itself a coverup, due to it's
incredibly inept architecture/design. It had a huge concrete
dome, cast-in-place, as "arched" ribs. Well enuf. But then, the
dummies went a step further and cast-in-place "inverted arch"
segments between each arch rib. The result, as any school
child could tell them, was structural weakness and instability.
Soon afterwards, the underside of the massive dome (which
was intricately tiled) began to crack and the loosened tiles
would drop upon spectator's heads during SeaHawk games
and Sonic games. The Sonics moved out quickly to escape
liability issues of their spectators. The Seahawks too, to play
in the open air Husky Stadium at the UofW. Clearly a violation
of State-vs-Private use of taxpayer facilities. Whitewashed to
the usual carpet underlay.
The KingDome had to be demolished. Quickly. Lest the whole
thing come crashing down imminently. But must not let the
taxpayers know the real reason. Instead they contrived to
build the "much better" more "flexible" sliding-roof SAFECO
stadium. One block south of the Kingdome. (Both of course
built upon the unstable landfill of pre-modern-era Seattle mush
and swamplike tidal wetlands, circa 1890.
The public wanted to keep the Kingdome. Because they were
(mostly) unaware of it's impending collapse. They didn't wish
to be taxed for another (SAFECO) stadium. The Old-Boys-Net
pushed it upon them anyway. The taxpayers were irate. They
held a referendum. Voted it down. Roundly. Yet the Old-Boys
Net managed to foist it upon them anyway, somehow, and
then quickly proceeded to implode the "too small" Kingdome
with vast fanfare.
You're right. No-two people in Seattle can ever agree upon any
venture; plan; design; concept; candidate; location; weather;
or flavor of Coffee. Twas ever thus, since 1940 to my recall.
I left there in 1990. 50 years was enuf. I don't know how
Gandalf [ ;^) ] survives over there. Maybe he drives a MetroBus
which gives him precedence over all other vehicles.
Political Correctness More Important than Factual Correctness
http://www.msnbc.com/news/516386.aspRALEIGH, N.C., Jan. 14 � Twelve of the most popular science textbooks used at middle schools nationwide are filled with so many errors that they fill 500 pages, a new study has found.
RESEARCHERS COMPILED 500 pages of errors, ranging from maps depicting the equator passing through the southern United States to a photo of singer Linda Ronstadt labeled as a silicon crystal. None of the 12 textbooks has an acceptable level of accuracy, said John Hubisz, a physics professor at North Carolina State University who led the two-year survey, which was released earlier this month. "These are terrible books, and they're probably a strong component of why we do so poorly in science," he said. Hubisz estimated that 85 percent of children in the United States use the textbooks examined. "The books have a very large number of errors, many irrelevant photographs, complicated illustrations, experiments that could not possibly work, and drawings that represented impossible situations," he told The Charlotte Observer.
PUBLISHER POSTS CORRECTIONS ON WEB
The study was financed with a $64,000 grant from the David and Lucile Packard Foundation. A team of researchers, including middle school teachers and college professors, reviewed the 12 textbooks for factual errors. One textbook even misstates Newton's first law of physics, a staple of physical science for centuries. Errors in the multi-volume Prentice Hall "Science" series included an incorrect depiction of what happens to light when it passes through a prism and the Ronstadt photo. Hubisz said the Prentice Hall series was probably the most error-filled. Prentice Hall acknowledged some errors, partly because states alter standards at the last minute and publishers have to rush to make changes. Last year, the company launched a thorough audit of its textbooks for accuracy and posted corrections on a Web site, said Wendy Spiegel, a spokeswoman for Prentice Hall's parent company, Pearson Education.
Black Blade: Another wonder fact in some of these textbooks: The equator crosses the southern part of the US. Hmmm� The textbook publishers have staffs for "political correctness" that are in most cases, more than twice the size of "factual correctness committees." US public education � no wonder the US places 9th in the industrialized world for competence in the sciences.
Pardon me for the confusion Panda, I will try to clearify my analogy.
When a plane fying over a million gallons of fuel depletes that immediately available, whether at ten or ten thousand feet, all the hot air produced by every politician on the planet blowing at the same time will neither keep the plane in the air, nor will it put one once of that million gallons of fuel in the tank, gravity claims the plane.
Economics had nothing to do with it, the fuel wasn't available at any price. Supply and Demand.
An so it is on Space Earth. Politicians, although incapable of producing one once of fuel, are capable of distorting the reasons for the relatively high price of the 10 gallons of fuel available, when 100 gallons are needed. That is until all the immediately available fuel is gone, at which time the final 10 gallons became a bargain.
Most world currencies are down against a much stronger USD tonight. The Euro is down hard, yet the yen continues to tank faster than a Kamikaze plane. The Aussie dollar is holding steady though. The PMs are slightly mixed with platinum up $1.70. NY Crude is up at $30.32/bbl ahead of the OPEC production cuts to be announced at Wednesday's meeting. NG is down substantially at $8.22 Mbtu as many are unsure what Kalifornia's restructuring plans for it's two major Utes means for NG (not much). The state plans to enter the power brokerage business (this ought to be good as well as entertaining). Other than that, market futures are somewhat mixed.
BTW, David Tice was on CNBC today as a guest discussing Bear Market investing. He mentioned gold and silver as undervalued plays. He also focused on Harmony Gold (HGMCY) and Pan American Silver (PAAS) as his PM stock picks. Also, Robert Novak in a recent interview talked about Robert Mundell and touched on the subject of gold. He stated that gold should be valued at $320/oz (at least). The recent Steve Forbes article alluded to a gold valuation of between $325.00 and $350.00 as appropriate. At least gold is entering into a lot of public discussion lately.
Safeco Field was already a fact before the fate of the Kingdom was determined. Paul Allen, as part of the deal to purchase the Seahawks was responsible for the new football stadium and the demise of the Dome. To the best of my recollection there was seventy five million dollars left on the original cost, and about one hundred ten million was put into fixing the tile problem before it was scheduled for "retirement"
Slade Gordon put the financing package together for Safeco Field after it was defeated by the voters.
The mono-rail put all the city fathers, who had been pushing for light rail, into near hysteria when the initiative passed. I don't remember who got it on the ballot but the Times lobbied hard against it, and to say that its passing was a suprise was a gross understatement. They were required to institute feasability as well as cost and route studies but I have no idea what the results were.
I have never lived in Seattle proper, but I love the area, the trouble is, it is no longer Americas best kept secret.
Where there's smoke, there's fire. That's how I look at it. Follow the money: what happened to all the gold shipped from South America to Spain? Much of it was shipped to the east for spices. Spices were needed for preservation of meats, they were much more than a fancy condiment.
During that same time there was an enormous and increasing demand for three oriental products: silk, porcelain and tea. One historian writes: "This silver, wrested from America, not prized enough in Spain, roams the world...a moments distraction, and already we find them in the Indies and China". Frank Spooner - Paris 1926. The author of The Power of Gold - Frank L. Bernstein describes China as a sponge for gold. So even without the WWII European gold, the gold could still be there. So the question still remains.
Remember, you are living on one whacked-out planet, and anything is possible. Do you remember the singer Steppenwolf? Part of the words to a song of his go:
"but the people got fat and grew lazy, now their vote is a meaningless joke". I forget the name of the album. Wasn't it something like: "Monster"?
DJ Asia Precious Metals: Gold Up On JPY, AUD, Short Covering
TOKYO (Dow Jones)--Asian spot gold was trading higher late Tuesday after a day of thin trade and gains on a slightly stronger Japanese yen and Australian dollar, traders said. Although there had been some noticeable bargain hunting out of Hong Kong, most of Tuesday's trade had been between dealers themselves, said a Sydney trader. The trader also said that some short covering had been evident. The yen had risen slightly from Monday's lows and was trading around Y118.10 to the U.S. dollar late Tuesday. The Australian dollar had risen to US$0.5566 from US$0.5524 late Monday. A Hong Kong dealer said dealing was subdued after the U.S. holiday Monday and was drifting without New York as a market indicator.
Hong Kong spot gold opened at $264.05 a troy ounce, up 42 cents from London midday Monday. The market is capable of further downside and is heavily shorted, said the Sydney trader. The Bank of England auction next Tuesday will force a further drop in the price of gold, said the Hong Kong dealer. "It's bad news for gold and should push the price down below US$262." On the Tokyo Commodity Exchange, December gold closed Tuesday down Y9 a gram from the previous close of Y1,007/gram, silver was down Y9/gram from Y1,777/gram, platinum was down Y17/gram from Monday's 10-year high of Y2,343/gram and palladium was down Y32/gram from Y3,607/gram.
-By Ian Kerr, Dow Jones Newswires; 813-5255-2935; Ian.Kerr@dowjones.com
Black Blade: Fortunately, analysts are usually well off the mark.
--------------
Open mouth, insert foot
--------------
My apologies to Perplexed and to anyone else who took umbrage at my last posting. It was never my intention to talk down Americans. Randy, Michael, I did not write that post in hopes of achieving HOF status but rather in answer to several other posts. Perhaps my post ought then to come down.
I do stand by my words in that post, however. The election debacle in Florida pales into insignificance when contrasted with examples from European politics, but it does provide an excellent example of a failure of equipment to meet popular expectations. I chose that one rather than one from UK politics simply because it was better known to most readers here.
The Florida crisis also provided a world-class demonstration that the U.S. governmental system, whilst supplying amble fodder for political pundits the world over, is nonetheless more robust and less prone to collapse than most anything else which has come before it.
Look at what happened and marvel. Florida's local infrastructure was an accident waiting to happen, an accident which went unnoticed so long as it didn't have to face a close race. The moment a close race transpired, the equipment was not up to the task of accurately recording the intent of every voter. First response: a calm re-running of the counting machinery. Second (and more problematic) response: a dozen or so opportunists sprang from the woodwork and used the situation as a platform from which to advance their own agendas, or at least seize their own 15 minutes of fame. People were beginning to assemble in the streets, chanting.
Many nations would come apart at the seams at this stage. Eastern Europe did so slightly more than a decade ago, in fact. But not the U.S. As I posted during the debacle, the rest of us were quietly sitting back and wishing you'd all come to one conclusion or another quickly and calmly, because it was quite honestly beginning to be frightening. As it turns out, we needn't have worried. That oft touted system of checks and balances saved the day, though I daresay in ways not anticipated by either the Founding Fathers or their descendants.
The U.S. has a pretty good track record of making mistakes only once. For example, you've had a civil war, but only one. A century later in the 1960s, the Mississippi valley was not allowed to secede. Every time something unexpected has blindsided the U.S. system, it has managed to survive the impact and then has put measures in place to defend against repeats in future. I fully expect the details of the U.S. election process will be given a thorough overhaul well before 2004 because you don't want a repeat of that indecision any more than the rest of us do.
But I'm certainly not putting down 'the Colonists'. And I do occasionally drink coffee.
The black market does not always work at a premium and it is not always a case of supply and demand.
For example, until about two years ago a certain internet site freely advertised sales of cigarettes at a massive discount to white market prices. The favourite brand was Marlboro Red which could be bought by the container load FOB Antwerp and elsewhere. Later, a major newspaper and TV documentary story broke about large tobacco companies selling their product into the black market.
Discounts can be had for all sorts of dubious commodities, including cash. I would have to check my data base for accuracy, but not that many years ago drug money was discounted at around 20-25% for the purposes of making it clean.
Say you ripped off a warehouse of Japanese televisions? You'd sell them via a "fence" at a discount who would privately sell them to us citizens at a discount to shop prices. In England such commodities and sales are known as having "fallen off the back of a lorry." This is admittedly the "lower end" of the market, but it still serves to demonstrate that discounts over "iffy" products are common place - and "iffy" can be perfecrtly acceptable commodities trading outside of controlled environments. The gold market is, of course, a controlled environment.
I was also present when an offer was made some months prior to the collapse of Yeltsin's Russian economy - leading to the LTCM debacle - of a heap of freshly printed, shrink-wrapped and palletized Russian Roubles - in massive quantities - from a well connected source in the former Soviet Union at the beginning price of 20% discount. The same fellow was offering gemstones - with full documentation, also at a discount, and a lot more besides.
I also know of oil deals ex Saddam (during the UN blockage following Iraq's antsy behaviour with the West) that flowed through US indivuduals (among other nationalities)and appeared to be sanctioned at senior levels of the US administration (can't be proved though). All of it was deep black and discounted.
No rigid equation lasts for long before it is chewed by flexibility and reality. My view is that it's not so much a wheels within wheels but "worlds within worlds" and even "markets within markets."
On reading your analogy clarification, I understand (I think) just what you are saying. However, I have to stand by my original explanation of the cause of your perplexity in this situation.
The confusion is compounded because we have contained in your analogy - simple mathematics (amounts of fuel, one minus one = zero), Newtonian physics (law of gravity), economics (supply and demand) and psychology (human behaviour, in this case a politician's - I believe, politicians, with a fair degree of latitude, just scrape in the human classification)
The main point you are making in your argument, though, still contains as a basic element, an involvement of human behaviour in the 'equation' which blows any attempt to apply any rigid (set in concrete) 'laws'as demanded by science.
Take comfort, friend, in that we know what you mean. The point is expounded time and again within (and without) this forum in one form or another. So also is the error of trying to rationalise what we have come to assume as fixed laws of economics - a subject more akin to psychology than to physics.
In your post you make many worthy comments, and certainly the essence of human motivations driven individually by self-interest has not likely changed substantially through time or by geography. This issue of black gold, however, requires an additional depth of understanding suggested earlier this weekend--that we are not ants.
Loosely, I suggest that from the perspective of "antkind" in its struggle for survival, the world is the same as it ever has been...particularly with respect to the "rules of the jungle". And further, hen seen from the perspective of "the world" itself, the essence of antkind behavior and its impact is also the same as it ever has been (for most practical applications).
In stark contrast to antkind's "same-as-it-ever-was" interaction with Mother Earth, any meaningful assessment of mankind as a whole reveals a performance more akin to the evolving development of a single entity (such as a butterfly) throughout a single lifespan of that entity.
More fully said, as evolving civilization establishes new "rules of the jungle" (laws of the land), men -- like butterflies -- do behave differently depending on the specific "rules" for the stage of the game faced at the given time in life, even while their self-interested motivations remain. Such self interest may require a body to crawl hidden and eat leaves under one set of rules while exposure to another following set of rules (i.e., opportunity) enables that body to fly forth in a display of nectar-sipping "birth" into the seeing world. And yet, even as the caterpillar's nature is inclined to a hidden existence during a particular stage, a premature and unintended flight into the open can occur even under the old rules of the jungle through discovery/conquest by superior forces (e.g., a bird in this extended metaphor).
Concerning gold and mankind, a rich history of conquest (generally by "official sectors") and of rule changes through time and geography have given ample opportunity for significant gold exposure--by force or by choice. It must certainly be acknowledged that once our civilization's "lifespan" developed to such a point where incentives arose for some gold to be kept hidden at the time of its discovery, clearly the stronger precedent of experience was that such gold was useful when "revealed" (spent) as a suitable alternative to its owners starving in the dark...and this would hold true for any point in this would-be black gold's post-discovery coexistence with mankind.
"Black markets"... "white markets"... go back far enough and you find there were simply "markets". Looking back to one full century after Europe limped through the economically plagued 1300's, estimates from historical evidence suggest there to be found at the time less than 150 tonnes in total gold. Over the next 350 years, and prior to the productive gold rushes of the mid-late 1800's on the several continents, the free and open coinage of precious metals brought to mints for ease of circulation (use as currency) in this more highly sophisticated stage of mankind's existence provided reasonable records and estimates that gold in known use in the civilized world increased by only 3,000 tonnes. Then, the "easy pickins" of the gold rush years prior to the cyanide leaching process instituted from 1890 onward yielded barely a tenth of today's highly scrutinized corporate production totals of roughly 2,500 tonnes per year. (By 1908, the new gold discoveries and extraction techniques had helped companies boost global gold production such that above-ground gold supplies swelled to nearly 18,000 tonnes.)
We must ask, when considering the political backdrop this turn of the previous century, where was the incentive for significant quantities of that newly unearthed gold (or previous hoards) to be kept hidden ("black") from free coinage or other wealth-utilization? Arguably, only with the cyanidation process of the single past century do we get gold production volumes remotely capable of feeding black supplies on a level suggested recently by some posters here.
Equally important, only with our very modern era of fiat currencies and tax policies do we face "rules of the jungle" in this collective lifespan of mankind whereby self-interested motivations would favor a degree of unreported/hidden new production. Certainly too little, too late to provide the levels of black gold cited to exist beyond that which is commonly acknowledged as historically produced totals.
To wrap up this commentary, one other element warrants brief discussion. You said in your #45689:
"The supply of actual gold, not only paper gold, relative to dollar denominated debt had to substantially greater than "officially" stated, else the system would have collapsed long ago as a result of over-leverage."
Could it be that you are overlooking an important phenomenon--growth of the (bullion) banks� operating sophistication through global integration, and with it the growth of the participants� confidence which counts for everything? For possible validation of this thought, look no further than the similar absence of U.S. bank collapses against the backdrop of meager "physical" vault cash which has been bolstered by sophistication of operation throughout the later two-thirds of the Twentieth Century. To be sure, now that the banking structure has gone global beyond the safety of any deep-pocketed lender-of-last-resort, only additional time has been bought by the over leverage, and the eventual failure will be all the more spectacular when it occurs. My friends and myself in The Tower hold physical gold in anticipation of that day. The latest shifts in the "rules of the jungle" indicate the day is near at hand.
Dollar's preview: cut interest rates to protect your currency
http://www.inquirer.net(Philippine) Peso closes down 38 centavos at 52.78 vs US dollar
Posted: 6:43 PM (Manila Time) | January 16, 2001
By Inquirer.net, with reports from AFP
THE PESO fell 38 centavos to close at 52.78 to the US dollar on fears of political instability should the Senate hand down an unpopular verdict in President Estrada's impeachment trial, and amid a further cut in the central bank's key overnight rates and weaker regional currencies.
The peso hit a new low of P52.95 in intraday trade from its 52.40 close on Monday.
Traders said that investors were concerned that the senator-judges on the basis of their political leanings would vote for an acquittal of the President on the bribery and corruption charges. Opposition groups have said that if this happens they would intensify mass actions and mount a civil disobedience campaign to force President Estrada to resign.
...
How many of you noticed that Israel, a nation playing such a large role on the world stage, for its size, is missing from your comprehensive list of national �gold holder's� stocks?
I am very familiar for a number of years with these �claimed� facts and figures compiled by WGC� which I take with a pinch of salt, as I do ALL government, democratic or otherwise, statistics put out for general mass consumption.
I put this, re Israel, to WGC some time ago but they could give no acceptable rational answer and showed irritation, and in being uncomfortable, at any further pressing of the point.
Some years ago, Israel was quoted in WGC figures. Then, sometime BEFORE the �western� world banks went on a dumping spree depressing the POG, they (Israel) showed ZERO holding. It would appea they sold out in good time at a good price. How amazing � such intuition.
http://www.usagold.com/onlinestore/special.htmlThe hard copies of the January News & Views newsletter will be arriving in mailboxes soon. Because it features this special youthful Dutch Queen 10 guilder gold coin as the "Coin of the Month", you can be sure that the few remaining items will be snapped up by Centennial's subset of clientele that do not have web access. (The arrival of the newsletter will be their first indication of the availability of this very special offer.)
Just wanted you to know in case you were riding the fence. You might want to hasten your decision lest you be outpaced to these remaining and lovely pre-1933 coins.
http://www.mrci.com/qpnight.htmLook at the USD index. The USD is just stomping mercilessly all over the other currencies. Futures are lower, oil is higher, even though NG is lower. Gold is up at least until NY opens, then will get it's usual drubbing like clockwork. Should be another interesting day. What's with the Euro anyway? Maybe Dim Wim gave an interview.;-)
The Battle is waging ... (some may want to skip over this)
Knights of the Round Table,
We are on the eve of what may be the most fought against presidential cabinet nomination ever. Why? Because we are in a battle against all that is good. I feel that our nation is being given one last chance to forsake our wicked ways. While I was somewhat skeptical of GWB and his claim of christianity, I am becoming convinced. He may not make every decision correctly, and I am not overjoyed that he has appointed some to his cabinet which are a part of the CFR and NOW � see below on my thoughts on this.
Our nation has forsaken all that is good and sought after our own self-gratification. For most of us in the US that encompasses the almighty US Dollar. In talking with my 82 year old grandpap, we are convinced that our nation has been allowed to come under this coming oppression because we forsook that which was Just. In reviewing Biblical history, I am hard pressed to think that we will not be judged for turning our back on God. But I would rather be judged in His mercy than His wrath.
Would we rather be a free, heathen nation in which you could not trust anyone including your neighbor? At any turn your gold, savings, etc could be robbed from you and you could be murdered. Or would you rather live in an enslaved, just nation? Where the usury money system has been destroyed and people are dirt poor, yet humble and honest.
Many here talked about the NWO and such organizations which attempt to usurp our national sovereignty. Is it possible that this will be a means of humbling our nation? Once again I do not have the answer, but I (we) must remember the bigger picture.
I don't know what lies ahead, but I know who does and I know that no matter how much I fret, it won't change things. Only one type of communication changes things and we need to humble ourselves and do just that.
I must confess that I have spent many hours on this forum learning many things �
->how gold can be used in an honest money system
->how we in the US have been enslaved by an unConstitutional Fed creating usury money
->how gold is a store of wealth
->how our current government administration has lied to and deceived us about the state of fiscal responsibility
My major vice is that I am addicted to USAGold and GE. I have spent many hours trying using the knowledge gained to within myself determine what is an appropriate strategy with a balance of European and pre-33 US semi-numismatic slabs to protect my family and savings.
But, I have fell into a trap no better than the people who spend countless hours and strategize on how to make the most of stock market trading profits.
I (We) should not try to figure out in ourselves what is an appropriate strategy under which gold may regain it's rightful place as honest money and savings. I have thought that maybe He has given us GATA to bring down that which is evil. But knowing that GATA would not have the financial resources, the only way which the battle would be won is if His people would humble themselves and seek His face and trust Him - then and only then would the battle be won. The battle is bigger than us and there is only one who can fight for us.
I urge every christian who reads this forum to humble themselves and seek His face and turn from our wicked ways, that our nation may be healed.
Oh well, enough rambling for this morning. I woke up many times in the night in prayer for these very things and felt compelled to voice them, even if I would loose my posting privileges.
Well, my friend, He gave his life trying to show you where the problem lies. Remember, just two weeks he after he took action against them, the establishment had the the crowd that had hailed his arrival, spitting on him and jeering him has he struggled to His execution.
I have pointed this out a few times but most of you, like the masses everywhere now and over the centuries either fail to, or just don't want to. see it.
It is all there in the so called 'good book' ( and I'm not a Christian). And, whether the book is factual or not there is certainly evidence from the earliest Greek copy in existance that the view was held for many, many , centuries.
Something I would like to add here as it is often not thought about. Christ was NOT a Christian. He did not come to start another, or even an 'off shoot' religion.
His religion, like many, but regretably,not all, Jewish people, then or today, was Judaism. There is nothing whatever wrong with that religion, only those who have used, and coninue to use, the religion, and His father's house, for their own gratification.
Something I would like to add here as it is often not thought about. Christ was NOT a Christian. He did not come to start another, or even an 'off shoot' religion.
His religion, like many, but regretably,not all, Jewish people, then or today, was Judaism. There is nothing whatever wrong with that religion, only those who have used, and coninue to use, the religion, and His father's house, for their own gratification.
Your thoughtful post has not gone unnoticed or unappreciated! Many of us have been thinking about the very same issues. I agree with a good deal of what you said, but I feel that the NWO, global governance, etc. is a different can of worms than old-fashioned dictatorship. It seems to me that, in the old days, an enslaved person was able to hold whatever beliefs he wished in his heart. As long as he did his work and said the proper things in public, he could cherish his own beliefs and teach them to his children.
In the New World Order (puke), our minds will not be free. We will be spied upon in every conceivable way. Our children can be seized (this is already happening) if we teach them things contrary to NWO principles. It disgusts me that not only are the would-be leaders corrupt to the very core, but they wish to corrupt us and our children too. Like many Christians, I believe that the "rapture" is approaching quickly, and that a showdown is coming between the forces of good and evil. Those who have been on the fence will be forced to take a stand.
Religion is and has been a major stumbling block to the "truth".
Messiah (Hebrew)= Christ (Greek)= Anointed One (English)
Christ is not Jesus' last name, as most people think.....it is who/what He is......Jesus THE Anointed One!
Anointed (smeared with, rubbed on, poured over, covered with) with what you ask?......The very Spirit of God Himself! Jesus is the prime example of "man" with God all over him and in/through him! By faith many have followed His word and become "little" (or junior) Anointed Ones, most people call this being "Christian". But they have missed much of the depth of the meaning/intent through not translating Greek to English. The process/transformation of becoming like Jesus (hence Anointed)is life long and sometimes painful....but the rewards are certainly worth every bit!
TD......the judgement/justice/help you sense in your spirit (kept you up last night) is on its way!........I believe that God has given us a front row seat through this forum/Gata etc., but you are correct it is He who is directing the show, and again you are right, in His "Mercy".
It should be qite a shoW!
Gold IS Precious!.....because He said so!
I remember reading about Iraq trucking crude to Syria awhile back. As far as Russians selling pallets of rubles goes, they probably got the idea from Greenspans puppetmasters.
A curve is ahead tells us FOA.Well,what do you do when you drive down the road with your ultra fast'souped up to the eyeballs Ferrari and you see a very sharp curve ahead? You reduce mercyless speed, slam on the brakes,put in a low gear to get the curve!(do you see the smoke of your
tires? but you saved your Ferrari!)
To get the gold curve'slam on the brakes and reduce SPEED=LEVERAGE (do you see the smoke? :-)
http://www.kitco.com/image/gold.gifThough this picture will change over time, the current "snapshot" of performance during the NY session should convey a loud and clear message. With price discovery occuring occuring in the derivatives arena (with spot derived after-the-fact as a mathematical adjustment based on currency and metal interest rates), it takes little more than the aggressive selling of COMEX February gold futures contracts into the hands of ever-more wary longs to drop the price on the fundamentals of paper supply and demand....like a bookies' changing line on a sporting event.
What better insurance can you imagine for hedge funds as they endeavor to unwind their gold carry positions and underlying gold loans? By selling the futures paper they can thus easily cap the cost of the metal they must repurchace. As a bonus, if they depress the futures sentiment far enough prior to expiration of the positions, they can even recover the cost of their "insurance premium" (or even profit) as they close their short positions while the longs sell out in capitulation.
It is a clear, beautiful example of commercial enterprises seizing a unique and esoteric market opportunity while it lasts. Markets have a way of mending their ruptures by the time the common visitor comes to identify the same opportunity and seek participation for a share of the winnings. Therefore, equally beautiful is this open chance for all men of wisdom and prudence to join them in buying gold (the metal, not the paper) at these discount prices these efforts have provided. This, too, shall pass, and by the nature of it there is no knowing in advance when the window of opportunity will slam shut--as it is wont to do where gold is concerned.
Still pumping currency...Fed adds nearly $8.75 billion to banking system reserves
While the federal funds market was fetching 6-1/8th percent, the Fed joined the fray with two rounds of open market activity. $6.745 billion was added to banking reserves via overnight repurchase agreements collateralized by a two-to-one mix of agency and Treasury securities. Additionally, the Fed stepped up with a 27-day repo operation creating an additional $2 billion. Over half of this was collateralized by mortgage-backed securities.
There will be no shortage of cash. "We shall have the hyperinflation," said Uncle Sam.
"Excellent choice, sir," intoned the waiter.
STONY BROOK, N.Y. (AP)--Scientists say they used a particle accelerator to smash the nuclei of gold atoms together to make the highest density of matter ever created in an experiment.
The accelerator, the Relativistic Heavy Ion Collider, smashed the nuclei together at nearly the speed of light, Brookhaven National Laboratory scientists said at a conference Monday. Physicists who studied the debris streaming from the collisions concluded that densities more than 20 times higher than those within the nuclei of ordinary matter had been produced. Temperatures in the compressed matter topped 1 trillion degrees.
The scientists believe that large amounts of matter so dense and so hot last existed a few millionths of a second after the Big Bang, the explosion credited with giving birth to the universe.
Physicists hope the violent collisions will break protons and neutrons into their subcomponents--quarks and gluons--further revealing the internal structure of nuclei. Although the measurements reported Monday cannot determine whether that goal has been achieved, they strongly suggest that further collisions will bring the so-called ``quark-gluon plasma'' to light.
``There is some tantalizing evidence I would say, but I think that we need to get some better statistics,'' said John Harris, a physicist at Yale University.
The Brookhaven scientists said measurements at the accelerator, if confirmed, indicate they produced matter with a density approaching two times the record announced last year at the CERN particle physics laboratory in Geneva, Switzerland.
The results may shed light on the birth of the universe and the centers of dense and exploding stars, the scientists said.
On the heels of my previous post, I offer this related excerpt featured today at MK's Commentary & Review Page
http://member.usagold.com/commentaryreview.html"'The money has been tight,' Mundell told me. 'They (the Fed) need to push more money into open-market operations -- not just cut interest rates.'" ---Nobel Prize Economist Robert Mundell as reported by Robert Novak, 1/15/01
------------------
Housekeeping note, particularly for our European clientele: The January News & Views pdf file is now available for downloading at this page. (Domestic clients are certainly welcome to it also if you prefer not to wait for arrival the paper copy on the way through regular mail.)
HEADLINE: The world's largest Gold Rush relic, an 80-pound gold brick, comes home
...Evans said it was definitely worth all the time and effort it took to recover the gold and create the traveling exhibit.
"When I see the wonder in their eyes as they view the gold, it brings back all the thrill I had when I first saw it," he said. "It is truly the stuff of dreams.
"We're all taught about gold and sunken treasures in stories from our childhood. It's ingrained in our culture, and to have actually gone out and found it -- that's a dream come true."
Awaiting the Death of Current Dollar-based Paper Gold Markets
In the FOA/Another scenario, we await the death of the paper gold markets.
Looking at the 10-year chart at: http://www.kitco.com/charts/livegold.html
(The 10-year chart is near the bottom of the live chart, and you must have JavaScript enabled in your browser to view the 10-year chart.)
We can extrapolate the price of dollar-based paper gold reaching zero about fifteen or twenty years from now. That's just from extending the trend of the last ten years.
Randy (@ The Tower): Recent ORO HOF Qualifying Message#45600
Hi Randy,
Welcome back. I hope you enjoyed the long weekend.
Have you made a choice whether to include/exclude ORO's message#45600 in the forum's Hall of Fame? If you are to exclude it, perhaps you will make an official statement. Has a qualifying HOF message ever before been excluded?
Here is the record of support:
Hall of Fame Message nominated:
ORO (01/13/01; 06:27:44MT - usagold.com msg#: 45600)
The last two paragraphs were cut off in posting, reatached in ORO (01/13/01; 06:31:13MT - usagold.com msg#: 45602)
Perhaps a Fifth Second at the bottom of:
Looking Up (01/13/01; 19:44:18MT - usagold.com msg#: 45635)
(appears to contain some mangled text at its bottom)
Thanks for notice, Parsifal...particulary the vital e-mail version
I have ORO's and Mr. Gresham's posts chalked in on The Tower wall near to my chair, here. I have bolted the door against outside delays/disturbances so that I may finally bring a long project to conclusion, and shall look into the HOF updates in due course. (I also have not forgotten the reply I promised you regarding some international banking issues...also chalked on the wall.)
Signs of continuing evolution in the "rules of the jungle"
http://biz.yahoo.com/rf/010116/n16664057.htmlExcerpt:
----------------
NEW YORK, Jan 16 (Reuters) - The proposed new Basel Accord announced on Tuesday, which details the amount of capital banks have to set aside against risk, has for the first time detailed the treatment of the thorny problem of operational risk.
[...]
There is ... a third, even more sophisticated approach called the ``Internal Measurement Approach'' which allows individual banks to use their internal loss data to calculate the amount of capital they need to set aside based on a uniform method set by bank supervisors.
+
The proposal makes it clear that the banking industry is still in the process of developing the data necessary to implement this approach and that ``currently, there is not sufficient data at the industry level or in a sufficient range of individual institutions to calibrate the capital charge under this approach.''
+
Banks are to be encouraged to move along the spectrum of sophistication and in return can expect lower capital charges to be levied but the Committee made it clear that it will set a ``floor'' level under which the required capital cannot fall.
+
It said it will review the need for the minimum level and where the level should be set two years after the implementation of the new Basel Accord, expected in 2004.
----------------
2004...my, how that year turns up again and again in these monetary affairs.
Net position in Eurosystem foreign currency assets falls by 1.1 billion in past week; gold assets tweaked
The European Central Banks weekly consolidated financial statement reflected a further decline in the position of foreign currency assets held by the Eurosystem central banks, dropping 1.1 billion last week to 260.3 billion euros. (You will recall, among other changes, the ECB as of last summer is no longer rolling interest earned on holdings of U.S. Treasuries back into such holdings.)
In an interesting nuance, the value of ECB consolidated gold holdings declined on the week by 4 million euros to 118.611 billion euros. The ECB described this as "an end-of-year adjustment to the valuation of a holding by one national central bank." Here in The Tower, we surmise that it would be very safe to conclude that it was the newly admitted euro-member Bank of Greece responsible for this aberration...likely the final unwindings of pre-Eurosystem gold operations. (The Bank of Greece, you may further recall, was not included as a signatory to the Washington Agreement back in September of 1999.)
Selling paper, buying metal...how easy, how natural
http://www.usagold.com/wgc.htmlFrom the latest update to "The Week in Gold" page--World Gold Council's commentary on notable features from last week's market:
". . . gold attracted fund selling from the outset . . . Friday saw much greater activity with determined selling being met by strong physical demand; "
"The high level of speculative short selling seen on Comex during the first week of the year was confirmed by the Commodity Futures Trading Commission. It's latest commitment of traders report showed the net short position of the large speculators surging from 23,735 contracts (equivalent to 73.8 tonnes) to 38,226 contracts (118.9 tonnes) during the week ended January 9. Since then open interest has risen further from 126,527 contracts to 133,056 contracts, indicating another increase in short positions in recent days."
AND, from the "You Already Knew This" Department...
"At the turn of the year Greece became the 12th full member of the European Monetary System. It consequently transferred a proportion of its official reserves to the European Central Bank as its contribution to the reserves of the Eurosystem. As with the existing members, 15% of the transfer of reserves was in the form of gold."
Meanwhile, the LBMA enjoyed a December upturn in clearing volumes, likely due to year-end book squaring. Still, these latest figures are "17% down on December 1999 and 22% down on December 1998."
Last two posts of the day on Sunday the 14th...
"Additional significance of the year 2004 that Ford mentioned for UK euro entry...That will be the year the Washington Agreement on gold is up for review and new terms."
Will also be a presidential election year in the U.S. ... giving voters a sense of "participation" in potential watershed events???
@Peter AsherMost gold is held as jewellery. Big guys keep gold as ingots or coins as well as goldbugs but represent a minority.
Now, short of a catastrophe neither the goldbugs nor the big guys will willingly sell their gold at a discount.
Drug dealers or mafia boys are prepared to buy gold at whatever prices to launder their paper but they are not going to sell. They don't need to. They have more paper that they can handle. And they keep the gold as a safety net. If anything this should increase gold value. Not the other way around.
For people in countries like India, China and generally speaking Asia plus in many European countries, gold is kept as jewellery. They love their jewels and they are not eager to get rid of them whatever the price. Again it will take some kind of disaster to compel such people to sell their ware.
I know that there are people selling their damaged or otherwise jewels to jewellers but at best this amount to a few tens of tons.
Haven't been around in two days and notice that the POG took ahit in N.Y. today. The almighty N.Y. takes a hit at the POG, very convenient.
Notice, my friends, that until a few months ago that Asia brought it up and London and N.Y. brought it down. Now London is skating and only N.Y. can bring it down.
Must have just gotten his gas bill. A truck hauling two trailers crashed into
the state Capitol and burst into flames
late Tuesday just as the Assembly was
clearing out after an evening session. The
driver died at the scene.
It was not immediately known whether
anyone else was injured, and it was
difficult to tell if the fire had spread to the
building.
Smoke and flames billowed from the
truck, which was rammed up the Capitol
steps and nestled below the state Senate
chambers. The Senate was not in
session; the Assembly was just
adjourning.
The man driving the truck honked his horn
and roared down the street going about
70 mph before the big rig crashed into the
Capitol's south doors, said Assembly
staffer Matt Z'berg, who was walking
down the street away from the Capitol.
"He came all the way down here blaring
his horn," Z'berg said.
The truck struck the building with a "humongous fireball
effect," he said, adding that he did not see anyone get out of
the truck.
The double-trailer rig bore the name of the Dick Simon
trucking company, Z'berg said.
The driver died at the scene, said a CHP officer who declined
to give his name.
The truck, loaded with powdered milk, drove around the
Capitol block several times, then barreled down 11th Street,
which runs along the Capitol, and smashed into the building,
said Assembly Speaker Robert Hertzberg, quoting law
enforcement authorities and witnesses. View
Yesterday's Discussion.
MANILA -- By one vote, the House prosecution panel lost last night its chance to open the second envelope containing information on the P3.3-billion account allegedly held by President Estrada with Equitable PCI Bank.
Senators viewed as being on the President's side openly gloated about the decision, which clearly divided the tribunal for the first time since the trial began.
"This is a shameless vote of acquittal," Rep. Joker Arroyo said when the hearing adjourned.
Volunteer private prosecutors walked out in disgust and Sen. Aquilino Pimentel Jr. resigned the Senate presidency shortly before the adjournment.
"This is a test run. This is how the Senate will vote (on Feb. 12)," Arroyo added. Earlier in the day, the peso fell to a historic low of 52.649 to the US dollar.
A noise barrage began last night in Fuente Osme--a in Cebu city as well as various parts of Metro Manila, while text and e-mail messages relayed the disappointment of Filipinos who watched Day 23 of the impeachment trial.
The protests were quickly organized and are expected to continue Wednesday.
Pimentel, who spoke last, voted for the inspection of the bank documents and immediately announced his resignation as Senate president.
"(Opening the second envelope) is the only way to determine whether or not the contents of the envelope are material... or not," he said.
A teary-eyed Sen. Franklin Drilon, who was toppled for deserting Estrada's coalition party last October, embraced Pimentel as soon as the session adjourned.
"Because of this development, I realize that the no's have it, and therefore I resign my presidency of the Senate as soon as my successor is elected," Pimentel said.
He later told reporters: "I think the decision tonight has done irreparable damage to the Senate as an institution. I cannot continue leading a damaged institution."
Estrada, the first Asian leader to be impeached, called key prosecution witnesses "liars."
The loss of the vote prompted the private prosecutors to walk out, with Arroyo saying they will report what happened to the House of Representatives.
The only other person with access so far to the bank documents, aside from Pimentel, also resigned.
"They (administration senators) don't want the truth to be revealed. I am very disappointed," said Senate Secretary Lutgardo Barbo.
Senator-Judge Loren Legarda said she will file a motion for reconsideration today. "Not all is lost," she said in televised interviews.
It was the first time the senators have voted in public in the impeachment trial, since it took only a ruling by Chief Justice Hilario Davide Jr. for the first bank envelope to be opened.
Those who voted for the opening of the envelope were: Senator-Judges Teofisto Guingona, Renato Cayetano, Loren Legarda-Leviste, Franklin Drilon, Juan Flavier, Raul Roco, Ramon Magsaysay Jr., Serge Osme--a III, Rodolfo Biazon and Pimentel.
Those against were: Francisco Tatad, Tessie Oreta, Nikki Coseteng, Miriam Santiago, Juan Ponce Enrile, Ramon Revilla, Tito Sotto, John Osme--a, Blas Ople, Gringo Honasan and Robert Jaworski.
The younger sister of Sen. Ninoy Aquino, Tessie Aquino-Oreta danced, raised her fists in jubilation and grinned broadly shortly after the voting.
Drilon, Legarda and Magsaysay approached the resigned Senate president to congratulate and commiserate.
The impeachment court spent about five hours arguing on whether or not to open the envelope, which Arroyo said will show the trail of money in the Jose Velarde account.
Defense Counsel Estelito Mendoza argued the information was immaterial and irrelevant to the case. He said the Velarde account and the Boracay mansion, which the President allegedly bought for a mistress, were never mentioned in the articles of impeachment.
Arroyo tried to argue that the entire P3.3-billion is ill-gotten. This was allegedly funded in part by P300 million from Dante Tan, P300M from Kevin Garcia, P120 million from Jaime Dichaves and P180 million from Mark Jimenez.
Since this much money was never mentioned in the statement of assets and liabilities of both Estrada and his wife in 1999, this constitutes graft and corruption, the second impeachment article, he added.
The prosecutor also claimed that the P500 million used to open a trust account with Equitable PCI came from this account.
Prosecution witness Clarissa Ocampo earlier told the impeachment tribunal that she saw President Estrada sign as Jose Velarde when she was asked to go to Malaca--ang for the signing and opening of the trust account.
"This is no joke. Where in the world can you see a President having no account in his name...the President has prostituted and bastardized the banking system, but not under his (real) name?" Arroyo told the court.
"How was he (Estrada) able to amass that amount when he (as a public official) is not supposed to practice his profession or engage in business?" he added.
Mendoza countered, however, that the House of Representatives simply wanted to "look like heroes" when they rushed the articles to the Senate even without verifying the complaint.
"And now they want the Senate to set it straight," he said.
Majority Floor Leader Francisco Tatad said the complaint was sloppily prepared when it was sent to the Senate.
Earlier in the day, a witness told the court the Erap Muslim Youth Foundation does not exist, nor does it have an office or staff.
Lawyer Oswaldo Santos said he was tasked to investigate the Erap Muslim Youth Foundation, which was created in February 2000 and later reported to have received as much as P200 million.
He began his investigation on Dec. 22, 2000, by checking all documents of incorporation of the foundation with the Securities and Exchange Commission (SEC).
But after he checked, he said, the office address and telephone number of the foundation indicated in SEC records are that of the De Borja law office, a firm that presidential legal adviser Edward Serapio helped found.
Santos, however, while questioned by Senator-Judge Nikki Coseteng, said his law firm also allows client-firms to temporarily use their office address in the incorporation documents.
The defense questioned the credibility of the witness by asking Santos who hired him to investigate.
Santos said his office conducted the investigation for free upon the request of the prosecution.
But he said he did the investigation not for the prosecution, but "for the love of his country."
He admitted, though, that his partner, Antonio Ligon, is one of the private prosecutors in the impeachment but only as far as his testimony is concerned.
The prosecution believes that the foundation was used to handle bribe money for President Estrada. (Sun.Star Cebu/wires)
Day 23 Highlights
The Erap Muslim Youth Foundation does not exist, prosecution witness lawyer Oswaldo Santos told the impeachment court. The address given by the foundation to SEC is occupied by the law office of Presidential Legal Adviser Edward Serapio, he said.
Serapio is one of the incorporators of the foundation while former Equitable PCI Bank chair George Go is the treasurer.
The prosecution argued that the second envelope, which reportedly contained details of the P3.3-billion account of Jose Velarde with Equitable PCI Bank, should be opened if the prosecution is to prove its case against the President.
The defense argued that the document sought to be opened is immaterial and irrelevant to the case and that the impeachment court has no jurisdiction over it.
The impeachment court voted 10-11 against the opening of the sealed envelope.
Senator-Judge Aquilino Pimentel Jr. resigned as Senate president. Lawyer Lutgardo Barbo also resigned as Senate secretary. Pimentel voted in favor of opening the second bank envelope.
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<;-)
You are not describing the "Black Market Gold" proposed to exist by several posters. I personaly have no position on it's existence other then that it could be true.
The Gold referred to is considered to be hordes from various historical events and activities and if true would make drug lord stashes petty cash.
I was explaining to you why this, IF TRUE, would be a potential market overhang/supply and therefore not be a higher priced market. I was not promoting the existence of these hordes, only why, if they existed, they would not be creating a high priced shadow market.
If Gold were confiscated again and forbidden to be owned, THEN that would be a typical high priced Black Market as the confiscation would be due to a controlled gold value being enforced that was far lower than what would exist in a free market. Part of your confusion may be because "Black Market"could actually be an improper title for these alleged hordes, maybe they should be called "Unrecorded Gold Hordes"
TOKYO (Reuters) - The yen kept the pressure on the dollar and the euro on Wednesday on robust Japanese demand and lingering uncertainty about U.S. commitment to a strong-dollar policy. The currency also picked up steam on the major crosses, thanks mainly to hedging and bond-redemptions by Japanese investors. But while Tokyo dealers see a possibility of the dollar retreating below 116 yen, most dismiss its current downswing as a temporary correction after a blistering five-yen rally in just two weeks. ``The 120-yen barrier can't be broken that easily,'' said Hideyuki Tsukamoto, manager at Fuji Bank's foreign exchange department. ``I'm a yen bear, but even I didn't expect the yen to go that low so quickly.'' The dollar hit a 17-month high of 119.39 yen on Monday, only to recoil as far as 116.90 on Wednesday afternoon. It picked up in late trading, standing at 117.30 yen compared with 117.65 yen late in New York on Tuesday. ``Many Japanese importers and investors are waiting for a chance to buy the dollar as its rally up to now was so fast that they missed out,'' Tsukamoto said. Stop-loss sell orders were rumored at 116.80 yen and a clear fall below that level should pave the way for the dollar to dip below 116 yen, dealers said. The euro earlier dropped just below 110.00 yen slipping from a 15-month peak of 113.19 yen scraped last Friday in London. At 1:24 a.m. EST it was at 110.43/55 yen with support of 109.50 yen. Market unease ahead of a crucial confirmation hearing for incoming U.S. Treasury Secretary Paul O'Neill prompted dealers to waste no time snapping up profits on the dollar. The market has been awash with rumors that O'Neill will temper or even abandon the United States' long-standing strong-dollar policy in the belief that a weaker currency will stimulate exports.
Many analysts and dealers doubt he would go that far, but since O'Neill's views on the dollar are completely unknown, the risk could not be ruled out entirely. O'Neill's hearing in the Senate starts at 1430 GMT. Another factor driving the dollar down was yen-buying related to redemption of foreign-currency denominated bonds, although the amount was not believed to be substantial, analysts said. There were also reports of a vague rumor about a troubled U.S. hedge fund. Dealers pointed to demand for yen from Japanese life insurers and trust banks, which were rumored to be hedging their foreign-asset exposure, particularly against the single currency. Hedging is instinctive for Japanese investors, who have repeatedly seen the value of their offshore assets eroded by a strengthening yen. ``For many investors, it's a chance to earn profits from the perspectives of both forex and bonds, as bond prices rose recently after the U.S. rate cut and with a weakening yen,'' a trust bank dealer said. That in turn encouraged speculators to test the dollar's downside. Some also saw support for the yen in the fact that Japanese share prices had stopped sliding, for the moment at least. After collapsing last year, the benchmark Nikkei 225 index (.N225) has steadied above 13,500 in recent sessions, buoyed by hopes of government help and Toyota Motor's decision to buy back 250 billion yen worth of its own shares. Changes to the Basel accord on bank capital requirements proposed on Tuesday proved significantly less threatening than expected to Japanese banks, which was seen as good news for the yen.
DOLLAR AND EURO IN BALANCE
The dollar held a slight advantage against the euro at $0.9427 against $0.9414 in New York, but was sandwiched between bids of $0.9350 and offers of $0.9440. The dollar was aided at the margin by a 50 point bounce in the Nasdaq futures contract on Globex after Intel Corp (Nasdaq: INTC) reported results slightly better than market expectations. But the euro in turn was supported by rumors that some Asian central banks were quietly expanding the proportion of euros in their foreign exchange reserves. The rumors were fuelled by a comment from China's central bank Governor Dai Xianglong that the euro was undervalued and the bank had no plans to change euros into dollars.
Black Blade: Former Sec. Lindsey has stated that the Bush administration will be committed to a strong dollar. So who's right? I don't think any of these idiots know for sure. We will have to wait until at least January 20th to find out for ourselves.
I read your post about the possible Grasshopper gone berserk. As I was listening to the radio tonight, there was speculation that there was some connection to the high-energy costs and the truckers� attempt at "disrupting" the state assembly. Strange days indeed.
SAN FRANCISCO, Jan 16 (Reuters) - California's Gov. Gray Davis has turned down a plea from Pacific Gas and Electric Co. for state help to buy natural gas for its 3.8 million gas customers, a spokesman for Davis said on Tuesday. The San Francisco-based subsidiary of PG&E Corp. (NYSE:PCG), struggling to fend off bankruptcy in the midst of California's worst-ever energy crisis, asked Davis on Jan. 10 to intervene on the utility's behalf after over half of the utility's gas suppliers said they would not sell PG&E gas for February delivery unless the utility paid for it in advance. `The state is not going to provide emergency assistance (to PG&E),'' Davis's spokesman Steve Maviglio said. He said Davis asked President Bill Clinton to invoke provisions in the 1978 U.S. Natural Gas Policy Act that gives the Energy Secretary emergency powers to order out-of-state gas producers to continue selling gas to the utility. A Pacific Gas and Electric spokeswoman said the company was conferring with its lawyers on the decision but declined to comment on these latest developments. The troubled company -- which has piled up more than $6 billion in wholesale power costs it cannot pass onto its customers due to a price cap imposed by the state's deregulation law -- has secured only a ``small amount'' of the one billion cubic feet of gas it needs in February.
If Pacific Gas and Electric is unable to secure all of its needs for next month it could be forced to cut some amount of gas service to non-core customers, like industrial users, the spokeswoman said. The needs of core customers, like residential and small business customers, will be met and would only be reduced if service to all non-core customers had been cut and all the gas in the utility's three storage facilities was exhausted, an unlikely event at this time.
Last week two of the utility's suppliers stopped selling gas to the utility for the rest of this month, citing its financial difficulties. To make up the shortfall due to the absence of these suppliers and to meet all of its customers gas needs, Pacific Gas and Electric has been drawing gas from storage facilities. PG&E, whose credit rating was slashed on Tuesday to junk bond status by Moody's and Standard & Poor's, has warned creditors that California's severe electricity shortage and 1996 deregulation law capping what PG&E can charge customers at a fraction of what it must pay in wholesale market, have nearly drained the company of cash.
Black Blade: I had heard from an acquaintance in Kalifornia that most employees that he knows that work for PG&E and Edison Intl. were selling out of company stock plans where permissible. There appeared to be a "rush for the exits" mentality he said. Also, Edison went into technical default today as it declared that it will not make debt payments starting today. Looks as if NG and electricity suppliers are about to turn out the lights on the Grasshoppers. Even in state independents such as San Jose's Calpine are in fear of being required to agree to being "regulated" by the state or face take-over through some act of imminent domain law imposed by Commissar Davis. Should be very interesting over the next few days. Funny thing, when computer prices were high, the state didn't threaten Silicon Valley this way. Hmmm�
Dynegy says may push Calif. utilities into bankruptcy
HOUSTON, Jan 16 (Reuters) - Dynegy Corp. (NYSE:DYN), a Houston-based natural gas and power provider, reportedly is considering filing bankruptcy proceedings against California utilities Southern California Edison and Pacific Gas & Electric if they fail to pay for their electricity supplies. The Los Angeles Times reported on Tuesday that Dynegy said time was running out and that a joint petition by three creditors would be enough to start involuntary bankruptcy proceedings. Dynegy officials were not immediately available for comment on the newspaper report. ``When and if they (Edison) default on Thursday, it puts us in a position where we have to take them into bankruptcy and I'm sure others will be right beside us,'' Dynegy President Stephen Bergstrom was quoted as telling the newspaper. Bergstrom refused to say how much money Dynegy was owed. Dynegy has stakes in California electricity generation plants with a combined capacity of some 3,500 megawatts. On Tuesday, Southern California Edison, a unit of Edison International (NYSE:EIX) , said it was suspending at least $596 million of payments due to creditors as it faces soaring costs to buy electricity in the wholesale market. Under California's electricity deregulation rules, the company has operated under rate caps that prevent it from passing on those costs to consumers.
Pacific Gas & Electric, a unit of PG&E Corp.(NYSE:PCG), faces a similar dilemma. California Gov. Gray Davis has been racing against the clock, trying to broker a deal with the utilities, their suppliers and state lawmakers under which the state would buy power cheaply, using its good credit, then sell it to the utilities at cost. But Dynegy's Bergstrom told the Los Angeles Times, ``If we can't get this bill through in the next two days this will start to unravel.'' Reliant Energy Inc.(NYSE:REI), another Houston-based company which has some 3,800 megawatts of generation capacity in California, has said that recent events cast doubt on the ability of the California Independent System Operator (Cal ISO) and the California Power Exchange (Cal PX) to make payments on behalf of California utilities to power suppliers. Reliant said in a Jan. 8 statement that the balance due to Reliant from the Cal ISO and the Cal PX had varied seasonally from $5 million to $270 million over the past 12 months.
Black Blade: Golly Gee, didn't Abby Jo Cohen and friends tell everyone that energy wasn't important anymore since we have the "New Economy?" Come on now, trot out the old girl to reassure everyone. Better do it quick before there isn't any electricity to see it on television or hear it on radio. So much for the "New Economy."
Another Power Alert Called in the Peoples Republik of Kalifornia
SACRAMENTO, Calif. (AP) - State power officials declared another electricity emergency Tuesday morning as several plants reported a shortage of natural gas. Southern California Edison told federal regulators it didn't have the money to pay its $596 million wholesale electricity bill. The California Independent System Operator, keepers of much of the energy-starved state's power grid, called a Stage 3 alert after reserves dipped below 11/2 percent. A Stage 3 alert could lead to rolling blackouts if reserves drop still lower. Last week, a Stage 3 alert was called when the biggest storm to hit the state in three years cut electricity generation at a key nuclear plant. The alert was dropped back to Stage 2 on Friday, when more power became available from other states. The new Stage 3 alert was expected to be in effect all day. A shortage of natural gas was forcing many power plants in Southern California to switch to oil, ISO spokesman Patrick Dorinson said. Power producing problems are possible and could worsen the power shortage, he said. Also Tuesday, Southern California Edison Co. told the federal Securities and Exchange Commission it would temporarily suspend payment to the state Power Exchange, which manages the wholesale buying and selling of electricity, and power suppliers. The company reported it would run out of cash Feb. 2 because its debts for buying electricity total nearly $1.5 billion and its cash reserves total only $1.2 billion. ``SCE is attempting to avoid bankruptcy,'' SoCal Edison said in its filing. The move came a day after the a major power generator, Dynegy Inc. of Houston, threatened to take So Cal Edison and Pacific Gas & Electric Co. to bankruptcy court if they didn't make payments due this week. The filing came as the Assembly prepared to consider legislation that would let the state buy electricity and sell it to utilities, which have amassed billions of dollars in debt buying energy in a California market unhinged by deregulation and supply shortages. Gov. Gray Davis said the state will try to sign long-term contracts with the electricity wholesalers to buy power and sell it to utilities. The state believes it can negotiate better prices than the utilities, which have seen their credit ratings plummet in recent months. PG&E and SoCal Edison say they have amassed more than $9 billion in debt as they buy energy at record-high wholesale prices and sell it at rates capped by state deregulation rules. PG&E officials said Monday that they would pay their $40 million bill due this week. The utility has approximately $500 million in cash, a spokesman said, with a bill for about $580 million due Feb. 1.
Black Blade: These Grasshoppers sure aren't about to get any breaks are they? I suggest that they get warm blankets, a camp stove, and a couple of flashlights - don't forget the batteries. Oh yeah, maybe build a power plant or two, and drill offshore of Santa Barbara for starters. The Ants may feel free to disregard the foregoing.
By Scott Harris
As an oilman, George W. Bush never had much luck looking for black gold in the fields of Midland, Texas. But as a politician, he struck a gusher when he tapped the energy business, drawing serious dinero from Texas giants Enron, Dynegy and Reliant. No other industry worked harder to elect Bush president, and none expects more in return.
As those companies rake in profits supplying electricity to power-strained California, their cozy connections to the president-elect are turning the West Coast's energy crisis into a political showdown between the Lone Star and Golden states. More than local pride is at stake: If the lights go out in California, the state could drag the whole economy into recession. California Gov. Gray Davis, a Democrat and potential Bush rival in 2004, is talking tough, accusing "out-of-state" power companies of exploiting deregulation's failure to conduct "legalized highway robbery." Davis is threatening to seize control of power plants if what he sees as profiteering doesn't stop. Even if he's bluffing, a brewing consumer revolt could restore regulation of electricity via a ballot initiative in 2002.
Meanwhile, the energy feud has Senators Dianne Feinstein (D-Calif.) and Phil Gramm (R-Texas) squaring off over Feinstein's proposed bill that would force the federal government to impose a wholesale price cap on electricity out West. Powerful Texas pols like Rep. Tom DeLay, the Republican House whip, and House Majority Leader Dick Armey are expected to join Gramm in fighting Feinstein's bill.
The Bush administration also may find other loyalties tested. California is the center of the new economy, and Silicon Valley executives who supported Bush are anxious to avoid problems like the blackout last June that cost companies tens of millions of dollars in lost productivity. It all has Dubya and company on a longhorn of a dilemma. How to save California while protecting his favorite industry's beloved - and highly profitable - movement toward an ever-freer marketplace?Bush's ties to the industry run deeper than an offshore rig's anchor. His father was in the oil business and so were his vice president and commerce secretary nominee. Campaign finance reports show that during the 2000 campaign oil and gas companies gave $1.7 million in direct contributions to Bush - 15 times what they gave to VP Al Gore. This did not include millions more in unregulated "soft money" donations to the GOP or the sponsorship of the Republican National Convention.
Enron, the huge Houston energy broker and Bush's chief corporate patron, provided $820,000 in soft money to the GOP and more recently donated $100,000 toward the Bush inaugural. Its top execs, Kenneth Lay and Jeffrey Skilling, also chipped in $100,000 apiece. Enron CEO Lay was rumored to be on the shortlist for the post of energy secretary. That appointment went to former Michigan Sen. Spencer Abraham, a Republican who was defeated in his bid for re-election in November. (In 2000, the only politicians who received more energy money than Abraham were Bush and New York senate candidate Rick Lazio.)
What galls Californians is that the Texas power companies have made billions in revenues thanks to the Golden State's runaway markets, pushing investor-owned utilities Pacific Gas & Electric and Southern California Edison to the brink of bankruptcy and prompting blackout warnings. Meanwhile, Enron's revenues nearly tripled to $30 billion between October 1999 and October 2000. But there is no hard proof that the companies have functioned as a cartel to create artificial shortages and keep prices sky-high. Energy company executives say they're just charging what California's screwed-up market will bear. The chief problem, they add, is that no new power plants have been built in California for more than a decade, despite a booming economy that has spiked demand for electricity. Davis' harsh words let his own constituents know who was wearing the white hat as he led a posse of California leaders to a Jan. 9 summit at the Clinton White House. Participants report those negotiations produced progress toward long-term contracts that should keep California's computers humming and its utilities solvent. The most dramatic development came the following day with the abrupt resignation of Federal Energy Regulatory Commission Chairman James Hoecker, a Clinton appointee who in December ridiculed advocates of stronger regulation as "charter members of the Flat Earth Society." His expected replacement, Republican Commissioner Curt Hebert, surprised Californians by promising that rate caps would receive stronger consideration. Bush spokesman Ari Fleischer, however, has pledged that the new president won't retreat from deregulation: "He has shown deregulation can and does work. That's what happened in Texas." For Davis, though, California's deregulation has been "a colossal failure." Returning home from Washington, he spoke of seeing "a light at the end of the tunnel." But unless the emergency measures pay off, California's ornery electorate could bring dark days ahead for Bush's energy buddies.
Black Blade: Time to politicize this problem, work out meaningful solutions later. What a bunch of buffoons! Kalifornia created their own mess, let them deal with it. Problems are solved when people suffer enough to demand that solutions be found. Unfortunately, Commissar Davis, Sen. Diane Fine-swine, and others will demand that others in other states bear the burden and they just might get their way. There's a lot of votes in Kalifornia. Good time to protect your wealth with gold and other hard assets before the SHTF.
Report: Bush Says He May Cancel Late Clinton Moves
http://dailynews.yahoo.com/h/nm/20010114/pl/bush_dc_4.html NEW YORK (Reuters) - President-elect George W. Bush has promised a quick review and a possible rollback of some of the most ambitious initiatives of President Clinton's last days in office, The New York Times said in its Sunday edition. In an interview at his ranch in Crawford, Texas, Bush said that chief among the steps he would review were regulations putting nearly 60 million acres of the nation's forests off-limits to development. ``I understand the Western mentality and I want the Western mentality represented in this administration,'' Bush told The paper. Reporters for the Times spent nearly three hours with the president-elect on Friday, and a package of their articles was posted on its Web site on Saturday. ``We've got lawyers looking at every single issue, every single opportunity'' to reverse actions taken by Clinton in the waning weeks of his presidency, Bush was quoted as saying. The former Texas governor, who is to be sworn in as the nation's 43rd president on Saturday, also said he was considering a new, tougher approach toward Russia that would limit aid for its conversion to a market economy. Such a move would end an eight-year effort by Clinton to use U.S. direct financial aid to Russia to coax the country toward reform. Bush suggested he would try to stop the money, except for that used to dismantle nuclear weapons, until Russian President Vladimir Putin cleaned up corruption and enacted economic and legal reforms. ``It just seems like to me that we don't want to be lending money and/or encourage the lending of money into a system in which the intention of the capital is never fulfilled,'' he told the newspaper.
Abortion Turnaround
In what would be another sharp reversal of Clinton administration policy, Bush signaled that he was inclined to use an executive order to stop the flow of American money to any international organizations that provided abortions in foreign countries. ``Organizations that promote abortions are organizations I don't want to support'' with taxpayers' dollars, he was quoted as saying. In each of the areas mentioned, particularly forest policy, he acknowledged that he would face resistance, and in some he foresaw legal restraints. He was also reported to be: -- Hoping to keep his Inaugural Address at the U.S. Capitol to just 12 minutes, based on the message that ``we can be a unified America.'' But he said the theme was not related to his slim victory in the Electoral College and his loss in the popular vote to his Democratic rival, Vice President Al Gore -- Planning to quickly introduce his plan to cut taxes by an estimated $1.6 trillion over 10 years as a single bill, perhaps modifying it to deepen benefits in the next few years to stimulate a slowing economy. Asked if he was willing to negotiate the size of the cuts, Bush shot back: ``The answer is no. I think it's the right number.'' -- Having second thoughts about having commented so enthusiastically about the Federal Reserve's half-point reduction in short-term interest rates early this month. ``I kind of read the feedback and tended to agree with it, frankly,'' he told the paper and suggested that he might not publicly evaluate future Fed actions.
Black Blade: WOW! Just all kinds of news that has a profound impact on our lives. It would be interesting to see how George Dubya reverses Bubba's Executive Order signing marathon over the last few weeks. The environmentalists will go ape**** over this. Sounds like a lotta fun. Meanwhile, I will continue to slowly gather up gold and silver bullion at bargain basement � fire sale prices. This real world events are more fun that watching television.
Attn: Black Blade / AllRecently, I've read read a few "analysts" of the Electric
Shortage say that "Electricity is one commodity that cannot
be stored" hence the market price becomes very volatile.
That's not altogether true: HydroElectric power can and is
"stored" as water-level behind the source dams. During wet
season, the water levels are built up to capacity, while in
the dry season they can then be drawn down as needed.
Tonight, Governor Gary Locke (Dem) of the Washington State
was on live statewide PBS TV with his monthly "Ask the Gov"
roadshow. Several phone-in viewers asked him questions about
the current state of State Current. (puns intended)
He mentioned that all of the State's dam(n) water levels are
precariously low for this time of year. At only 75% of the
usual storage capacity, and more drought is expected to
make the situation even worse, by the dry season when it is
normally needed.
He went on to mention that Washington continues to sell lots
of "excess" electricity to California during the winter and
then intends to buy it back from the California grid later
in the dry season. They've always done that. But wait...
California won't have any to send back to Washington, and
are forcast to not even have enuf for themselves.!.
He may be in for a big surprise. And the Washington utility
customers will not appreciate having severe electric prices
and black/brown outs at that time because of their stupidity
of selling our stored electricity (water levels) now to help
California get out of their jam. And of course, to make fat
exhorbitant profits now in doing so. Only to realize later,
that they themselves will need to enter/compete in the sky-
rocketing power markets to make up the shortfall.
Are these State "experts" so shortsighted everywhere that
they cannot see more than 2 days into the future at any time
or are they just naturally inept.?.
Next, I might mention that Governor Locke suggested two
things to totally alleviate the current shortage:
(1) Return to Daylight Savings time sooner, so as to delay
the onset of darkness and the peak load period an extra hour
(2) Everyone should think about turning their porch lights
on an hour or two later each evening.
With thinking like that, it's no wonder he was resoundingly
re-elected by the Washington State GrassHopoCrats. Or is
it Grass HippoCrits.?.
Two days ago, I posted several url/links to some charts that
have odd similarities and odder dis-similarities. Maybe some
of you saw them. (see above reference post #45671)
Tuesday we saw more evidence of what I mentioned as "Silver
seems to be marching to a different drummer".
Take a look at these two long-term charts, if nothing else:
On Tuesday, Gold plunged (was PPT'd) downward, yet Silver
went UP over 10%.
Silver shares PAAS didn't budge, despite favorable news that
they were getting online with some new South American mine
sources. But HECLA (HL/nyse) leaped 11% and is now 50%
higher than it was a scant three weeks ago.
I continue to believe that POS (price of Silver) will lead POG
(price of Gold) in the coming meltup of both. Silver will be the
detonator to the explosion. Looking at the two charts (above)
one can see that whatever cabal has been holding POG down,
does not seem to effect POS in timing nor depth/direction.
Could it be that Silver is more fundamentals-driven and less
manipulated, and is now showing signs of breaking out as the
severe shortage of physical silver becomes known to more
astute investors.?. And has suffered mostly, in the past as
simply being down "because sister-Gold is down.?. That all
may become a thing of the past, as little brother Silver shows
her the way. Obviously learning from rich-cousins Platinum
and Palladium.
Bye the way, I'm Talking My Book. I own shares of HECLA
and have recently swapped *all* my Physical Platinum for tall
stacks of Silver 1/oz Englehard "Prospector" rounds. All that
glitters is not necessarily Gold. I hope I've done the right move, at the right time. That would be rarity of itself.
To make matters worse (?) I've also quadrupled my holdings of
HECLA in the past three weeks. Will I ever learn.?.
Commissar Davis of the Peoples Republik of Kalifornia Solve Crisis with Stroke of Pen!
BAKER HUGHES RIG COUNT FOR WEEK ENDED JAN. 12:
Natural gas rigs working in the US and Canada: 886, up 24 over previous week and up 248 over the same period a year ago.
Black Blade: Not enough rigs to alleviate the crisis. Going to be some cold winters over the next few years and a lotta frozen Grasshoppers.
California Gov. Gray orders 5% cut in power use
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Fulfilling a US Energy Department mandate, California Gov. Gray Davis said the state will cut peak demand 5% -- or 1,600 Mw -- "within the week." US Energy Sec. Bill Richardson included the conservation measure as a condition for extending an emergency order requiring electricity generators to continue providing power to California. Under the order, the California Independent System Operator (ISO) must submit a progress report to the Energy Department by Tuesday. The reductions cannot include power saved
during curtailments by interruptible load customers who agree to having their electricity cut off in exchange
for lower rates.
Richardson initially ordered 75 generators and marketers in the West to sell surplus power for $64/Mw-hr to California, when the ISO declares an emergency. He issued the order after some generators declined to sell power for fear they wouldn't get paid by California's cash-strapped utilities. Negotiations, meanwhile, are continuing among Gray, federal government representatives, and power industry executives on how to resolve the state's electricity crisis. The parties are attempting to craft a solution that includes buying power in the future under long-term contracts and resolving a cash flow crisis for Pacific Gas & Electric Co. and Southern California Edison Co. that has brought the two investor-owned utilities to the brink of bankruptcy. In a statement, Gray said the conservation measures will reduce strain on the electric power grid and reduce the state power bill.
Provisions in the plan include: A reduction of energy use by the Department of Water Resources, one of the state's largest users of electricity. The agency will cut its peak load by at least 450 Mw-hr and up to 1,200 Mw-hr under certain conditions. The agency also will supply up to 150 Mw of power during peak load hours.
� Reductions at peak of 200 Mw in energy use by state government, including prisons, state office buildings, and the University of California and California State University system. The General Services department will shut down lights and heating and air conditioning systems at 5:30 p.m., reducing electrical consumption by 40% at peak. In addition, 50 Mw will be saved by continuing operations of state-controlled cogeneration plants and running existing emergency generators throughout the state during emergencies.
-- Stepped up coordination with federal agencies with California facilities to coordinate emergency load
reduction efforts by the University of California and California State University systems.
-- A California Energy Commission-led effort to reduce peak load reductions by cities and counties by 300 Mw.
-- A statewide public outreach campaign coordinated by the Consumer Affairs department and state departments to promote energy efficiency through newsletters, letters, web sites, and public forums. The state also will launch a publicity program with the California Science Center to reach its more than 1.3 million visitors, and conduct education campaigns with other museums and institutions.
NEWS BRIEFS
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Power is so tight in the Pacific Northwest that Bonneville Power Administration, the region's biggest supplier, is faced with a potential shortfall of 3,000 Mw, while the regionwide deficit amounts to an estimated 400-600 Mw. If Washington, Idaho, and Oregon experience a normal winter and no generating plants are out of service, the area will 'squeak' through the winter season, says Mike Hansen, spokesman for BPA.
From Steven King's PetroDispatch (Hey, ya gotta like a guy who has a "Black Gold Portfolio")
Anticipated warmer weather again caused US natural gas prices to dip, NYMEX natural gas for February delivery declined 23.6� to rest at $8.47/Mcf. The commodity focus is on a week-long price rally ahead of the OPEC meeting this week expected to slash crude supplies. At the meeting in Vienna on Wednesday, the producers' cartel is expected to agree to slice crude output to shore up sliding oil prices ahead of lower spring demand. Consensus among cartel members is growing for a cut of at least 1.5 million bpd, or around five percent. "All our figures indicate that there has been oversupply of crude over the past few months and stocks at the level of the consumer have risen sharply," OPEC Secretary-General Ali Rodriguez said on Monday in Vienna. U.S. Energy Secretary Bill Richardson in Paris on Friday said $30 a barrel, the current price of New York crude, was not an acceptable price. Richardson has been touring the Gulf Arab states to persuade cartel members not to slash supplies when the group meets. However, he is ineffectual. "We do not believe that cuts in production are needed," he told a news conference in Kuwait after talks in Saudi Arabia, Qatar, the UAE and Kuwait. "But we are realistic and recognise that there might be some modest cuts. We have asked for as small a cut as possible, this is being considered by OPEC ministers." Kuwait's Oil Minister Sheikh Nasser al-Sabah, often seen as a price hawk, said a cut of 1.5 million bpd, a figure supported by OPEC kingpin Saudi Arabia, was "acceptable." Iran, Venezuela and Indonesia weighed in on Monday to push for a cut of at least 1.5 million bpd.
Black Blade: I still submit that this energy crisis is the trigger that will begin a cascade effect on the economy. It is only beginning, and it will be brutal. Hard assets will be key. We will be very lucky if it is as tame as the 1970's energy crisis. No one has even prepared for the inevitable. Gold, real estate, etc. are tops, also get out of debt while you can, and Y2K-style gear is not a bad idea either. We watch Kalifornia and make fun of them as Grasshoppers, but they are only the most visible so far. This problem has been brewing across the nation for nearly 20 years and is finally bubbling to the surface. Wealth preservation is key, and PMs are portfolio insurance.
@Peter AsherI agree with your sentence : unrecorded gold hordes. Do you mean hoards?
IMHO the evidence of such hoards are so flimsy as to be irrelevant. I just can't take them into account. To believe that such hoards really exist, I need some more solid proof.
...Time is Short for the Shorts...The Clinton Administration's PPT (Plunge Protection Team)
has only three more business days.
After that... It'll be the BPPT.?.
Was it Ted Butler that reported and complained strongly to
an unreceptive CFTC (Commodity Futures Trading Commish)
that there were only four big-players holding a massive short
position in the Silver (yuk.. there's that word again) Futures
Market (COMEX) that exceeded the entire silver mine output
capabilities of all the functioning Silver mines in existance.?.
Do you suppose those Shorties are getting a bit jittery as the
Bush transistion may put some backbone in the lethargic
see-no-evil CFTC under new management Jan 20 2001.?.
Just looking for possible reasons the why s-word is going up.
You want proof of Black Gold hoards.?.
I think Peter is not about to disclose all his holdings to you.
However, I can offer to you, as much of my Black Gold hoard
that you'd care to buy, and at only for twice the COMEX/Spot
price of White Gold. Is that a bargain, or what.!.
But please do not ask to purchase any of my Black Silver. I
need to polish it first.
You wrote:
[snip]
No one has even prepared for the inevitable. Gold, real estate, etc. are tops, also get out of debt while you can, and Y2K-style gear is not a bad idea either. We watch Kalifornia and make fun of them as Grasshoppers, but they are only the most visible so far.
[unsnip]
During the winter of Y2K, I installed a 10KW diesel alternator
and 450 gallon storage tank at my remote off-grid ThaiRanch
in (yuk) Northern Kalifornia's mountains. Much to my delight,
I found that I could generate my own electricity and store it
as DC in the Battery Bank, then invert it back into 120 AC to
meet whatever power needs were required. And the cost was
far less per KWH (KiloWatt Hour) than that charged to grid
users in the not-so-nearby surrounding PG&E homesites.
Perhaps the answer to the future.?.
Does that make me a Grasshopper, an Ant or a Sasquatch.?.
LONDON (FTMW) -- As the Romans used to say, fire tests gold, adversity tests strong men. There's plenty of adversity for gold investors these days. The price of the metal at $265 an ounce has left the shares of gold mining companies in tatters. Some observers, like analyst Ken Landon at Deutsche Bank in Tokyo, believe the metal's drop to a low of $263.50 this week is good news for financial markets.
At that price, gold has lost 8 percent of its value in dollars in the past year. "The 8 percent decline in gold since January 2000 tells me that inflation is headed lower in 2001, which is a welcome change from the uptick in inflation in 2000," Landon says from Tokyo. "All else equal, a decline in inflation will be bullish for U.S. stocks and bonds this year."
Indeed, Landon believes the decline in gold's price to a 16-month low means that most investors believe President-elect Bush's pick for U.S. Treasury secretary, Paul O'Neil, will continue a strong-dollar policy. A strong dollar generally discourages investors from buying gold. Yet for all the gloomy signs for gold, some signs are appearing for a sustained rally of the metal, and for depressed gold mining stocks.
Gold, of course, is that soft, chemically inert metal that for almost 3,000 years has been used as a form of trading currency and worshipped -- by Rome, Constantinople, Greece, and of course, Ivana Trump. Gold's price 20 years ago climbed to $800 an ounce after inflation scares around the globe. It's been downhill ever since.
That may be about to change. First off, we're seeing rising demand for gold. Physical demand from Arab countries, India and elsewhere is exceeding mine supplies by more than 20 percent. Next is price. Gold is close to a 20-year low. Can it go lower? Sure. But many companies, like South Africa's Anglogold (AU) , the world's largest gold miner, and California's Homestake Mining (HM) , have tightened their belts by slashing production and marketing costs. Which leads us to consolidation. Of late, there have been very few gold mining mergers. More change is on the way. Salomon Smith Barney's analysts in New York expect a wave of cross-border combinations in coming years. "The takeover of Battle Mountain by Newmont Mining (NEM) , and he proposed merger between Franco-Nevada (of Canada) and Goldfields Ltd. (of South Africa) (GOLD) may signal a scramble for partners," Salomon's precious metal researchers said in a year-end 2000 report.
And finally, there's the dollar. If the U.S. dollar slips against major currencies, gold will benefit as a financial haven. Some see the dollar's decline against the euro in the past several weeks as a harbinger of dollar weakness. Gold bugs like to point out that there are only 125,000 tons of the metal above ground in one form or another. Much of it is in the vaults of central banks. The amount of steel or aluminum produced each year dwarfs gold's limited supply. Salomon Smith Barney sees a massive deficit" in the gold market - physical demand for the metal exceeding mine supplies and gold scrap.
Such a deficit comes as demand increases from Arab countries, which are using their greater oil prices to buy the metal for jewelry and for investment, some analysts say. The gap in supplies also is happening in the face of regular central bank sales of gold, led by the Bank of England. In a Washington agreement in September 1999, 15 European banks effectively stated their levels of future gold auctions and lending.
If the world sees a global recession this year, or greater inflation, investors could rush to the metal and to gold companies. A 30 percent move in the price of an ounce of the dense metal could double the prices of stocks such as Newmont Mining, Barrick Gold (ABX) and Anglogold. Gold stocks, as seen in a five-year chart of the Philadelphia Gold-Silver Index above, are depressed beyond belief.
Not everyone is crazy for gold. Larry Edelson, editor of The Safe Money Report in Florida, sees the price of the metal flirting with a steep drop. Look for a test of $252. If that breaks, you can expect gold to fall to my long-term target of $225," Edelson says. "Silver looks horrible too. " Landon, senior currency strategist for Deutsche Bank in Tokyo, says, "If you assume a climate of disinflation, then I would say that the price of gold will not go up, but would go down."
Black Blade: Uh-Oh! Thom Caladra is "dissing" gold ;-) Yeah, just what we need. More bearish gold articles. OK, not entirely bearish.
Attn: Peter Asher / AnyoneDo you recall, here in the Forum, about Spring of 1998, there
were a couple of posts mentioning "off to Laos to check up on
some highly secret discoveries of rare Black Gold".?.
At the time, it went mostly unnoticed by us and no further comments or questions were posted by anyone about it.
We of course were unfamiliar with that terminology and most
thought it was a new geological form of the element gold. And
brushed it aside mentally as scientific nonsense.
Now, we learn of the French having supposed shipped all their
later to be, Black Gold to "Indochina" circa WWII for saftey(?).
Laos; Cambodia; and Vietnam were at that time Colonial
possessions of France collectively known as French-Indochina
and so maybe there's something to all this that we missed.
Laos, today, remains a relatively "closed" society, still under
a tight Communist form of Government, and doesn't report any
gold reserves to the WGC. They (Laos) remain quite aloof and
independent from China; Vietnam; and formerly USSR control
or benevolent relationships. Possibly that Black Gold, if they
still have it, allows them to remain secure in their isolation. It
may pay-the-bills as they dribble it out in underground ways.
If anyone in the Forum was/is or recalls the Laos/Black Gold
postings, lets try to paste them back into this new discussion.
No umbrage taken, at least by me. It was just an opportunity on my part to tell, as Paul Harvey would say "The Rest of the Story" or at least the story as perceived by some of us on this side of the pond.
There is no reason to feel that your post is no longer deserving of HOF recognition, nor that you should in the future walk on egg shells.
I, like you can only present one point of view, and I certainly harbor no delusions that mine is always correct.
I was disturbed by what I considered an overreaction by HBM
to your previous post, and was preparing a response, when Peter Asher posted his, which I considered the ultimate incapsulation of the problems inherrent in opening the forum to specific interpretation of any of the various religious beliefs. Again, Thanks Peter.
I, you, and many more of the participants appreciate the fact that our religious (or lack thereof) beliefs color the interpretation of every scrap of information which is processed by our brain, is reflected in our correspondence, and thus without specifics, is itself important information.
As most of the long time members realize, The Declaration of Indpendence is my passion.
While this forum is dedicated to economic matters, with an accent of gold, I have stated that in my view the problem confronting not only this nation, but the world, is a governmental system, which, with periodic tweaking, dates back perhaps 10,000 years.
That system is now in the process of collapsing around our ears, and gold is only one of the many balls that "Merlin" must keep floating. When one hits the ground, this circus has just finished its run.
So while you express confidence in the eventual stability of our political system, I see a house of prostitution, fulfilling James Madisons statement that "Democracy is the most vile of governments, and generaly is a violent in its end, as it is short in its duration," right before my eyes.
We fought a war against a government ordained of God, if you believe the propoganda, and justifed the killing of the Kings troops with the statement "That all men are created equal."
This was both religious and governmental blasphemy of a system which dictated that some are created Kings and others slaves. Some make the law and others are "subjects of" or subjected to laws over which they have no say.
To compound the blasphemy, Jefferson then added "governments are created by men, deriving just power from the consent of the goverened."
Conditions at the time precluded the establishment of this government in its entirity. It's not possible to stop a train moving at 90 miles per hour in its tracks, and neither was it possible to instantiously counteract forces which had been common practice for thousands of years, merely by declaring them to be wrong.
It has taken us a little over 200 years and several wars including, as you mentioned, one fought amoung ourselves to free enough of the minds of current generations to at last establish this government of individual soveriegns. In my opinion we are on the cusp of this event.
This portion of land was not only blessed with every element required to be self sustaining, but was, and continues to be blessed with forward thinking and courageous people from every corner of the globe.
As you pointed out it seems that Americans possess a knack for finding solutions to problems with the potential of destroying the unity of the nation.
We have just finished celebrating the achievements of Martin Luther King, a later day patriot, without whose contributions the cohesion of this nation could not have survived.
Contributions toward individual soveriength paid for with his blood, a price common to many other freedom fighters, not only in this nation but worldwide.
Holtzman you are a self described Apiest, I am a self described Diest, and there is not a day goes by that I do not reflect upon my good fortune.
I can envision no better heaven than being given a beautiful building site, everything required in its construction, the ability and opportunity to construct anything I choose, the freedom to enjoy it, a family of love and a mind that gives me instant access to my creator, and above all the conciousness to recognize and appreciate.
This in my opinion is worth doing everything within my power to extend to following generations.
It will not happen immediately nor will it occur without hardship and the shedding of more blood, however, when it happens within this nation, those nations who do not follow will soon find themselves in the modern day equivilant of the stone age.
LONDON (FTMW) -- Some observers, like analyst Ken Landon at
Deutsche Bank in Tokyo, believe the metal's [gold] drop to a low
of $263.50 this week is good news for financial markets. At that
price, *GOLD HAS LOST 8 PERCENT OF ITS VALUE IN DOLLARS IN THE
PAST YEAR.* -Thom Calandra, Gold's fading allure, FT
MarketWatch.com [from Black Blade (1/17/2001; 6:20:41MT -
usagold.com msg#: 45775)
http://www2.marketwatch.com/news/yhoo/story.asp?nu=1&source=blq/y
hoo&dist=yhoo&guid=%7B3A1FCDE9%2DBD28%2D4886%2D9481%2DD6DC2C75C80
8%7D
- *The dollar at its low was down 11 yen, at 120.3 yen per dollar
from 132 yen per dollar yesterday. *THIS IS BETTER
THAN AN 8% DROP IN THE DOLLAR, THE BULK OF THIS HAPPENING IN
ABOUT THREE MINUTES IN THE MIDDLE OF THE NIGHT.* This is an
"astounding drop" in the world's largest currency.
_-MSNBC etc., 7 October, 1998 _ -"This is the biggest one
day dollar drop in 25 years." _-Kathy Jones, Prudential
Securities, 7 October, 1998_
The Contrast: Paper-gold (even manipulated) loses 8% of it's
value in one year. The dollar loses 8% of it's value "in about
three minutes in the middle of the night." This is why - - -
They [much of Europe and the Middle East] do not see any
advantage in holding the currency bonds of one country, as a
reserve asset of future payment, over holding physical gold as a
reserve asset in full payment. The fact that the debt reserve
asset pays interest is little more than a joke in
these banking circles. *Any paper currency, the dollar
included, can fall in exchange value against your local
currency far more than the interest received!* ...
__-FOA (Friend Of
Another), 17 Sep 1998, (fwd) from USAGOLD.COM
Bush's Sec. of Treas. O'Neil changes mind, supports strong dollar @ALL
CNBC reports this morning that Bush's Secretary of Treasury designate O'Neil testified that he will support the strong dollar policy of his predecessors.
Perhaps they've been brought up to speed on the dangers of foreigners unloading dollar denominated everythings once the value of the dollar is perceived to be dropping relative to those foreigners' own "home" fiat currencies - - - OR gold.
Perhaps the fact that Bush Sr.'s James Baker III had weakened the dollar to "good" effect and "Dubya" proposed a known "strong dollar" opponent as Treas. Sec. got media play necessitates "counter propaganda." Or perhaps they now see (after Bush's te-ta-tay with Greenspan) that there's no safe way to weaken the dollar? At least not directly in the glare of public scrutiny.
Could it have been an ant? @Peter Asher msg#: 45754
Sir Peter!
Could that truck-driver been an ant a bit upset at being robbed to support grasshoppers? He showed up at the door of the organization who does such robberies!
And, which state-capital was it, if you could indulge my curiosity?
". . . As a result, Treasury policy occurs at the margin with a universe of political possibilities that can't possibly be covered at Senate hearing except possibly in the here and now. More often than not, it is the perception of Treasury policy that is important -- the public relations angle -- more so than any "policy" per se.
. . . . . But the only dollar policy that matters is the one that starts with the Fed -- its policy on currency issue. . . . As reported here regularly the Greenspan Fed has created vast seas of green currency which have floated the equity markets of the world including our own. But these dollars have also fueled an international inflation the likes of which has never before been seen on this planet.
+
Monetary policy does not "occur." It "haunts." And though the nations of the world can juggle their interest rates and thus the value of their currency relative to the dollar, if they do so while inflating the issue of their own currency, all they have done is masked that "haunting" and subjected themselves to the inflationary policies of the Fed. All the world's citizens -- save those of deflation ridden Japan -- will see their currencies deteriorate against goods and services as a result.
+
So much the better for gold, which is not subject to this sort of gamesmanship, but gamesmanship of a different sort which has a predictable conclusion. You cannot restrict the value of a commodity without eventually causing supply tightness, demand growth and eventually a price explosion. ... There comes a day of reckoning..."
-----------------------
Let me assure you that this small glimpse I have offered does not do proper justice to conveying the quality of the report in full--and of the many others like it offered regularly at the **Commentary & Review** page reserved as a service for Centennial's clients and subscribers.
If you have an interest in gold or in keeping informed on the gold market but have not yet established a business relationship with Centennial Precious Metals, I urge you to consider beginning your tax-deductible subscription today. Then, let Centennial help you diversify your paper-dominated portfolio by putting the lasting power of gold into your hands.
HINT: You need focus on this primary issue--Whose debt HAS it been (institutionally, that is) as the key, and with whose debt shall it now be substituted?
Two related thoughts to ponder:
"We cannot both hold the same breath of air."
-AND-
Shall we save the banks, sir?
"We shall have the hyperinflation."
Excellent choice, sir.
It was here in the People's Republic of California. I believe it was just as the assembley was getting out. I got my latest power bill from PG&E, perhaps he did too.
At $11.74, it was nothing to write home about. Just shows what a bit of conservation can do. I throw on a polar fleece when it gets chilly rather than turning on the heat, never use the dishwasher, and turning out the lights when I'm not in the room. The laptop (always on) uses little power, and for kicks I've been cooking on the coleman propane stove rather than the apartmrnt's electric one. Used the money I saved to pick up a little more of the shiney stuff.
That MK guy sure knows what he is talking about! We see it here...
http://biz.yahoo.com/rf/010117/n17200813_2.htmlFrom Reuters: "O'Neill acknowledged that the first line of defense against economic weakness was monetary policy, controlled by the Fed, not fiscal policy."
See this, in case you have been sleeping for weeks:
"Two weeks ago, the Fed launched its first strike against the recent sharp slowdown in the economy -- a surprise cut of half a percentage point in the two key rates it controls. The Fed was concerned that production and sales were slowing too rapidly and consumer confidence was waning."
To be sure, the U.S. will NOT be allowed to follow in the footsteps, repeating the Japanese experience. Therefore...
One of the most highly anticipated housing report comes out tomorrow. Even with the December month being the most heavily "seasonaly adjusted" some are thinking 5-7 % down. I think the actuals could be 12 - 20 % off judging by all I know. Interesting Home Depot is selling off just prior,could smart money have a whiff already? Stay tuned
"Imperial Sugar Company, the number one US sugar producer, filed for chapter 11 protection from creditors tuesday amid heavy debt the company has blamed on heavy losses and high costs for energy and raw materials."
Excerpted from today's St. Louis Post Dispatch
I am beginning to see many references in print to the corporate debt problems cited by PIMCO. Also, the FT today has a number of interesting articles. I do believe, whoever is pulling everybody's strings (in Europe), is positioning the puppets out of harm's way. I do believe FOA is authentic.
Best lessons are often the simplest: Dollars are everywhere...these coins are not.
http://www.usagold.com/onlinestore/special.html...you either have them, or you don't (at ANY price). ---End of lesson.
-------
Given the current economic backdrop, can you envision a sudden surging future demand for dollars? I cannot. Dollar flight and gold demand is the more likely.
This is why tangible gold is held by people and by central banks alike...because past earnings of wealth are too valuable to be entrusted to guardianship by paper currency units.
You.ve got to admire the guy. You can see why 'they' wanted him out of the way. It would have been so much easier doing business, and getting your own way, with a house-trained puppet
WEDNESDAY JANUARY 17 2001
The Gulf War: Ten years on
Multinationals circle around Saddam's crock of gold
BY CARL MORTISHED, INTERNATIONAL BUSINESS EDITOR
IRAQ is the crock of gold for oil multinationals and no one should be surprised that Shell is flirting with the regime that guards the world's second-largest oil reserves.
Iraq is exporting a tiny fraction of its potential output, its exports restrained in part by lack of investment but also by presidential diktat. Under the UN oil-for-food programme, the country can export some 2.3 million barrels per day, but at present the state oil marketing organisation (Somo) is demanding illegal kickbacks of 40 cents per barrel. Exports are down to almost a quarter of normal levels as big oil companies shy away from the dubious deals, leaving only a trickle entering the market.
For the Iraqi President, oil exports are a carrot and stick to wave next week at the new man in the White House. It is an irony appreciated by Saddam Hussein that most of Iraq's oil ends up in US refineries. With a wave of the presidential hand, Iraq could pump an extra 1.5 million barrels into the market, causing prices to plummet, confounding Opec's price strategists but delighting American motorists.
Iraq could export much more still and it is the bigger prize that entices Shell and others such as TotalFinaElf. Thierry Desmarest, the French company's chairman, has his pen poised over a contract to develop Majnoon and Nahr Umar. These oilfields alone could yield 1 million barrels per day if sanctions are lifted.
Iraq has proven reserves of 112 billion barrels � about half of Saudi Arabia's known resources � but oil analysts reckon that the true picture is several times that level.
"With full exploration of the Western Desert, Iraqi reserves could easily double, bringing them up to Saudi Arabia's level," Julian Lee, of the Centre for Global Energy Studies, said. He believed that the country could double production rates quite quickly, with a large number of oilfields explored and mapped but undeveloped.
For oil companies that expect to drill ten dry wells for every success, such certainty is mouth-watering and Iraqi oil is onshore and therefore cheap to produce.
Apart from TotalFinaElf, Russian and Chinese oil companies are the most active negotiators in Iraq.
American oil companies will not even show their noses in Baghdad while sanctions prevail and a big cut in Opec production this week will put pressure on the US President to secure energy supplies for Americans.
Randy, to put this in perspective of time, 1300 is a very late date to start collecting statistics on gold. Europe, in which these statistics were collected was just over (or close to) its low point in population, economic activity, and definitely in commerce, where gold was used most intensively (silver was the main metal of trade within Europe of the time, gold was used mostly in "international" trade).
The bulk of commerce was in the far East, on the Southern coast of the Mediterranean, and within the Americas. Europe was but a spec on the map of global commerce in the late Roman and early Middle ages. Only the end of Byzantine supremacy, once challanged by the New Zoroastrian Mohammed, gave Europe a rise in relative importance.
It should also be noted that by the time there were government mints, there were also mintages of gold and silver substituting for them. There was a PBS program about American coinage recently that shows the huge variety of coins and notes issued by the government, banks, and mining companies during the Civil War. Nary a copper was to be found as the coin shortage demonstrated Gresham's law to perfection. Metal was hoarded, notes of all kinds were used in trade, and none expected payment in full by either of the sides to the conflict. Notes were discounted to face value, and prices skyrocketed in terms of government and bank notes. The great curiosity was the trade coinage, where companies minted their own coinage rather than provide the raw materials to the mint. Though no reason was provided in the program, I would hazard to guess that none would trust government to return hard currency (coin) for anything provided to the mint.
This same issue holds in warring Europe of the time late middle ages and on. It would have been foolhardy to come to the mint, as the strapped treasuries of all principalities made any and all attempts to fund their aggression or defense. Europe was not a place where one would admit to owning anything of value if it were not behind tall walls and protected by armed guards and soldiers.
Furthermore, Europe and the Mediterranean have leaked gold and silver into the Orient since time immemorial. Up to the late 19th century, the tradesmen of the West had nothing but gold and silver to trade with the Far East. Even today, the pattern continues to some extent despite all manner of financial inventions and political coercion. As a result, Europe and the Mediterranean were forever losing gold. Thus when Rome lost its gold mines in Sardinia, Egypt, and elsewhere, and had been minting gold coins with nearly no gold content for years on end, the Western Empire collapsed. The Eastern Empire continued on in a fixed social and religious society where there was no change for 5 centuries, slowly depleting its remaining grandeur. Silks continued flowing from the Far East, and precious stones came with them, gold continued flowing the other way. After the fall of the Western Empire, the times of widespread gold use in Europe were well over, and were just coming back by the 1300s, as the Crusades brought trade back to Europe.
To give the lie to the 150 tonne estimate, Byzantine Emperor Anastasius I raised the Imperial hoard BY 160 tonnes during his reign. Due to the early Emperors of the East retaining control of the African gold mines (Egyptian and Ethiopian, and West African), and the rather frugal government practices they inherited from Constantine I, the currency � the Solidus of 0.2 ounces of gold (re the 20 Franc gold piece) remained just the solid gold coin that it was throughout the Eastern Empire's heyday till Islam attacked. The lack of inflation had kept trade in "good money" going on at the best terms of trade throughout the 5th to the 10th centuries.
Needless to say, if the Imperial hoard could be increased by 160 tonnes in one lifetime with only a simple tax, the gold in use through that period within the Byzantine provinces alone must have been that much greater in volume. Wealthy Western Romans, the few remaining by then, moved their fortunes to the East as well as they were able. They were part of the drainage of wealth from the Italian peninsula.
Since banking at that time was not a substantial practice, the amounts of gold circulating had to be great multiples of the Imperial coffers. What the multiple was? I wouldn't know. I can venture a guess that natural cash balance preferences have not changed much till the 1800s and guess that it was on the order of one to two times average annual income, and having a tax rate of 10% to 20% would bring the gold quantity circulating to 300 tonnes (treasury holdings after Anastasius� death) divided by 10% to 20% and times one to two - giving some 1500 to 6000 tonnes, and in any case having been in the range of around 4000 tonnes, +100%, -50%. The figure assumes that one year's taxes were kept on hand at his death. Byzantium was very much agriculturally driven and thus highly seasonal in tax revenue, thus providing an incentive to hold a hoard sufficient to cover this tax revenue.
Furthermore, it should be noted that during this period, Attila the Hun was bribed by the Eastern Emperor not to attack, by making payments in gold. The gold was taken back east of the Steppes where it would eventually trade for the silks, spices and gems of South East Asia, China and India. These are the end points for gold and silver, and forever were so. Likely, this will continue as it always has.
This is on top of the Persian Susanaite's hoards, those of the Thai and Viet nations, and of China, the various Indian states, and the Spice Islands, not to speak of the South American gold. .Remembering that the latter were recipients of gold flows from pre-Helenic days going back to the Old Kingdom of Egypt, and pre-Babylonian times of Ashur.
Again, the problem with taking data from the various Royal mints is that seldom were the Royal tax men far away from the mint, and taking gold there was a rather dangerous affair most of the time. Furthermore, gold coins circulated for centuries after their mint dates, thus making the mint's operations minor relative to outstanding gold, and not at all telling of anything but for a perhaps minor portion of the gold supply.
Large holders and traders of gold used bars for trade rather than coins, and would not have had a need to go to the mint in the first place. This is true today as it ever was. When the conquistadors were collecting gold and shipping it to Spain, they only minted into coin the ammounts spent locally and in transport, the rest was melted into bars and shipped in this form.
I was going through some investments mags which I had acccumulated over the last twelve months prior to throwing them out. I was amazed at how much that year 2004 cropt up in various articles as being some crucial time at which certain events on the financial world stage will come to fruition.
Hi VanRip,
...and we thought Gold shorts were DENSE!
That project was (I believe) originally intended to de-couple the two Au Atoms - no mention made of success/failure in that area - keep watching, glimpse at the future.
@Thai GoldIn my mind neither you nor Peter are considered black gold hoarders. According to your definition I am one as well. So I am totally uninterested in your hoards. Be modest, it can't be enough as to change any trend in the gold price situation. I think you are goldbugs, unless otherwise stated. I believe that, a real goldbug won't sell his hoard unless he has a very strong incentive to do so. A 3,000% for exemple. And a real goldbug will never sell his ware when the price decrease unless he is in very, but very big trouble. Do you fit in such a scenario?
BTW what do you mean by White Gold? Whatever it is, I understand you are ready to get rid of it for a 100% profit. Not bad anyway. But, that way, you are certainly not going to depress the price of your white gold.
As for the gold sent by the French in Indochina : It could not have been very much considering that most French gold was already in the USA to pay for war supplies. Whatever the amount, it must have been confiscated by the Japanese who where cleaned dry by the Americans. So the most probable spot for that gold now must be in the USA.
What I call black gold hoard are such things like the Yamashita (hope the spelling is right) gold treasure, supposed to be stolen all over in Asia. To whom? Well! Suppose to be everywhere in Asia. It seems that Yamashita was a very frequent traveller. The amount varies according to the writer, from a few hundred tons to several thousand tons. As of late it seems that Marcos got his hand on at least part of that treasure. Still nobody has ever seen it. Rumors. While I agree that there must be some gold stashed somewhere in southern Asia, it doesn't, by a long shot, get close to the reported figures . And then, one more question. Do you believe such people are eager to get rid of their gold at these bargain prices? They must be philantropists.
You can drink all the "liqa" down in Costa "Riqa" but it ain't nobody's business but your own! Cheers. I am having a glass of "dollarized" Chilean Merlot; not up to French Bordeaux standards but, a real thirst quencher after 700 miles!
http://biz.yahoo.com/rf/010116/n16172008_2.htmlSpeaking to MSNBC, Robert Rubin said, "I think inevitably, when you've had an extended period of good times, imbalances and excesses develop ... and now we're going to have to have a period of unwinding until those imbalances and excesses work their way out of the economy." More importantly, he made this point: "I don't think there's any way to know whether this is going to be a soft landing or a hard landing."
Please appreciate also the deeper meaning in the Reuters article's concluding remark:
-----His advice to the incoming economic team of the Bush administration was to determine what contributed to the eight-year period of high growth rates and "try to stay on that path moving forward."-----
Meaning, he himself does not know even now, or is not giving it up -- you decide! But seriously, try this "contribution" on for size: inflationary practices coupled with blind investor confidence positioned most importantly against an international backdrop in which no one was willing to allow the U.S. "applecart" to be upset.
But with the successful launch of the euro, there is a whole new fruitstand in town. The institutional conditions necessary for the U.S. economic phenomenon of the past decade are now gone and the "good times" therefore should not be expected to continue as before. It is time to change horses if one is expecting to take the "path moving forward".
Knowing both sides of the pond, but now living on the European side, I can say - ignore the rhetoric about there being much division in Europe. Ignore the doom and gloom on the 'sick' Euro.
Sure there are differences, and there is jockeying for positions, and there is some 'attempt at hanging on the 'the old', but, in spite of everything, Europe is on the move, and the EURO will be a strong currency, and Europe a great place to be for the forseeable future.
Europe is where it will all be happening. It's ALIVE! You can feel it.
Gold will start to firm once the Euro establishes a dollar parity ( I said 'establishes' not reaches) which won't be to long away. This has all been planned by 'the movers and shakers'. Britain WILL adopt the Euro - again, ignore the rhetoric to the contrary.
China will move close, economically, to Europe, and she will be instrumental in forming a close union of the Asian nations.
O.K. Lets see now.
Trucker crashes into state capitol steps.
Kalifornia has rolling blackouts.
O.P.E.C. cuts crude 1.5mb Go strategic reserve!
World Net Daily 10 reasons for gold. Words Out!
Gold and silver at bargain prices.
Three full page advertisement in my city paper
to buy gold and silver coins at 2-7 face value.
Do not attempt to adjust your television for the talking heads are doing their spin.
Can you see the Big Picture.
To ThaiGold. 10kw/d.c.storage battery/ inverter to
a.c. Need solar panel to battery to
maintain storage and decrease 10k.w.
run time. More bang for your buck.
SlingShot.
Randy, between your posts and all the others I must make some time to discuss. I hope to be free most of tomorrow and friday,,,,,, will cover several topics including a general comment about MY's great formulation of the money world around us. Also, will explain what I tried to get across about Black Gold.
Wow, I was just looking over the WorldNetDaily article on gold. I said this morning that it was an advertisement, but you know what? It is listed as WorldNetDaily Exclusive Commentary!! That means they found Blanchard's research paper on 10 reasons to own gold so compelling that they printed it as a story! THAT is fantastic, and it's just possible that goldbug pressure on WND caused them to see the truth!
ThaiGold is making jokes about our personal hoards. My huge stash of ten Eagles, ten Philharmonics, eleven 0.24 sovereigns, two .01 Phils and one 0.2 Angel is safely ensconced in the safety deposit box since pre Y2K. We felt if it came down hard, that rural homes could be targeted .
I personally believe there will no confiscation no matter what. This is based on the fact that in 1933 Gold was legal tender at a fixed price and in those days of meager worldly knowledge the population mostly was willing to accept FRN's without much protest. Back then, they didn't have a clue that they were being swindled out of an asset that was to be worth much more in the future. That is no longer the case. Trying to confiscate Gold now from vast hordes of gold holders and hoarders, who would be aware of where the POG would be headed in that event, would be met with full blown rebellion; in and out of court.
http://www.wmal.com(This is a reply to Miro on Kitco): Dear Miro: You're thinking of WMAL-ABC radio in Washington. It is definitely not a National Public Radio station! National Public Radio is the PBS of the airwaves, and it has a definite liberal leaning. Your friend, Leigh (from Loudoun Co.)
Sorry, MK. I'm not registered at Kitco, but I wanted to clear this up for Miro.
I spent a couple of weeks in San Diego recently. The weather was perfect, but
way too crowded. I went down there to try to straighten out a friend who is
so caught up in gambling on the stock market and who has been smoking so much
crank that she is a mess. That part of the trip turned out to be a disaster.
After working out a plan to divest her positions, instead of selling stock
and working her way out of the market, she began short selling. I got so
upset I had to leave. Luckily my parents live up near L A so I spent the rest
of the time with them. That part of the trip was wonderful.
She has lost $900,000, yes, you read that right, $900,000 in less than a
year. After I got out of there, she shorted heavily and then when Greenspan
unexpectedly
raised rates, she was caught by surprise like everyone else. Ameritrade
cashed out her positions and now she owes them money. She is trying to sue,
but good luck, I think those brokers have themselves covered. Now she is
talking about cashing in some cds so she can play some more and get her money
back. She won't listen to reason, probably because of the speed she is
taking, so I guess she will have to lose everything before she wakes up. Sad.
I've made this observation before and after the close today I must repeat. There have been many occasions where one average or the other will be up say, 68 and the other will be down 68 or so, like today. Does anyone else see this?
... the golden "liqua", or better coctail hour, or better described as the hour of Joschka Fischer, Germany's golden green SecState., hauling the great coctails of Molotow in 68 and getting away, while confessing to sway terror in the way of Cohn-the "Bendit" and Schmidt-Klein, the anti semit and raider of OPEC in Vienna. Well they only killed 3, to Joschka's glee, since the others were abducted to Algier's and obstructed the plans of Yamani!
So now we hear -terror is near and may be forgiven, if the need for political opportunity is a given - fact to keep the socialistic rule intact.
Molotow Joschka, was preaching to hate and debate, the Johnnie's come late to the conservative plate, as Austria has missed the times of the great Kohl's and Thatcher's, and was therefor abandoned to history, which condems the late!
Oh, well - getting off topic ever more - Mr. Schroeder, losing some of his staff to mad cow desease - was sore and may just want to ease the pressure on Joschka and release the same on - according to the WA - on the market of gold and blame the terrorists of (68-) old for ruining the standard of gold.
ALL told - the London pool of gold was solidly sold on behalf of the bold fiat paper stronghold. And to the end, spend another Cent, you can't afford to abort.
... und die Moral der Geschicht - glaub an keine Dollars nicht! - Kauf lieber Gold und bleib ihm treu, das sondert Wezen von der Spreu! (anyone interested in a translation please refer to cb2's copyright) - best to rest the case and test rest...
For the first time in the state's months-long energy crisis, officials ordered power
companies to shut off electricity to parts of California.
After weeks of warnings, rolling blackouts became a reality for California
residents today when regulators ordered utility companies to turn off the
power to thousands of people in parts of the state.
The blackouts were ordered shortly before noon local time in areas of
northern and central California and affected between 200,000 to 500,000
Pacific Gas and Electric Co. customers in the San Francisco area, and
thousands more in Sacramento, Modesto and Turlock. California regulators
lifted the blackout order around 2 pm local time but said they planned to reissue the rolling
blackouts at around 5 pm during the peak power period. Terry Winter, the CEO of California's
Independent Systems Operator - which controls the power for most of the state - warned
consumers that they should find ways to cut back their power use or the blackouts could go
beyond today.
"I hate to say this, but if people don't conserve and really make a concerted effort to not use
power, we're right in the same situation tomorrow," Winter said.
San Francisco, Sacramento Affected
The blackouts are controlled by individual utilities which turn off circuits inb local eras for an
hour at a time. Downtown San Francisco felt the blackouts immediately as automated teller
machines shut down and at least two students got stuck in an elevator at Hastings School of Law.
Traffic lights went black in several San Francisco Bay communities, and people were seen
calling on their cell phones to check if their homes were without power. Others were making
calls to find out which restaurants were going to be without power so that they could make
proper dinner reservations. In a San Jose sandwich shop, lunch was served with the doors open
so that light could seep through.
Despite several close calls in recent weeks, today was the first time the Independent System
Operator had failed to scrounge enough electricity at the last minute to avoid outages. Utility
companies were trying to avoid cutting power to blocks with essential services such as
hospitals. Meanwhile, ISO officials said the blackouts are necessary to prevent other blackouts
in neighboring western states.
"We need to make sure that we do not drop below an unacceptable level and put the system at
risk, which would actually put the overall western United States at risk of a blackout," said Jim
Detmer, the ISO's managing director of operations.
... Sir Peter,
I'm stunned to have to deliberate your, as I can only deduct, ethnical phrases, such as black- or brown out's, regarding the Peoples Republic if Kalifornia. A state spawning Golden Gates (Neither Bill, nor Nash) Bridge's across a soundless Sound; Mind you, never mindless, since Silicon Valley will be swamped by Silly Con Heights - always happened in these parts - as electricity was mis-taken for ethnicity.
Seriously - Sir Peter, don't take me for mis-connected ... I'm just mal-adjusted to survive powerless -
-cb - in distress 2!
PS: It's not starting - it's only the beginning of the
end game.
@Peter AsherConfidence for confidence, my own hoard consists of a few one oz Kruggerrand, Maple Leaf, Johnson-Mattheys and Engelhard ungots + a good portion of Silver 1oz Maple Leaf. All safely stashed away. We are definitely not big guys.
As for the confiscation, I don't think it posssible anymore. Common people have no trust anymore in their government. To try to confiscate their gold again will just provoque civil disobedience if not worse.
DOW and NDQ Closing AveragesOne average or the other will be up say, 68 and the other will be down 68 or so, like today.
That is what inspired the PONZI. One would be up 50 the other down 50 and each day or two it would reverse. Lots of smoke but they failed to go much higher.
In looking back to( SHIFTY (04/08/00; 00:12:28MDT - Msg ID:28297)
you can see just how far they have declined.
http://biz.yahoo.com/rb/010117/es.html By Jonathan Stempel
NEW YORK (Reuters) - PG&E Corp. (NYSE: PCG) said on Wednesday that it and its Pacific Gas and Electric Co. unit defaulted on $76 million of commercial paper, and that the state's largest utility will be unable to trade with California's major power distributor as of Friday. PG&E and Pacific Gas and Electric Co. also said they are in default under some of their credit lines, and that their lenders refused to allow them on Tuesday from drawing on two of those lines. The California Power Exchange arranges the distribution of power in that state. The announcement, in mirror filings with the Securities and Exchange Commission, came on a day the California Independent System Operator, which runs most of the state's transmission grid, enacted rolling blackouts throughout the state in a desperate bid to avoid overloading the grid. It also came one day after Southern California Edison, the state's No. 2 utility, said it defaulted on $596 million of payments to bondholders and other creditors. The default by San Francisco-based PG&E and Pacific G&E marks just the third time in the last six years that a U.S. company has defaulted on commercial paper, or short-term debt. Pacific G&E and SoCal Edison, a unit of Rosemead, Calif.-based Edison International (NYSE:EIX), have run up about $12 billion of debt because a rate freeze keeps them from passing on their skyrocketing wholesale power costs to consumers. Pacific G&E serves about 13 million customers in northern and central California, while SoCal Edison, which is based near Los Angeles, serves about 11 million Californians.
PG&E shares closed Wednesday on the New York Stock Exchange at $9-5/8, down 1-5/16, or 12 percent. Shares of Edison International closed on the Big Board at $8-7/8, down 11/16, or 7.2 percent. Lenders rarely default on commercial paper because of its short-term nature, and because they often can't issue it in the first place if their credit quality is not high. A unit of builder Armstrong Holdings Inc. (NYSE:ACK) defaulted on commercial paper in November, while Mercury Finance Co. defaulted on some paper in January 1997.
CREDIT LINE DEFAULTS, TRADING PRIVILEGES SUSPENDED
In its filing, PG&E also said it is in default of a $436 million short-term credit line and $500 million long-term credit line. PG&E said its lenders are entitled to accelerate its repayment of about $434 million of outstanding debt under the $500 million credit line. Pacific G&E, meanwhile, said it is in default of an $850 million credit line. Many of the defaults were triggered by cuts in the last two days of PG&E's and Pacific G&E's bond ratings to low junk status by credit rating agencies Moody's Investors Service and Standard & Poor's. Separately, Pacific G&E said the California Power Exchange plans to suspend its trading privileges as of Friday. It said the rating downgrades required it to post collateral, and it cannot. Pacific G&E said it owes $583 million to this entity on February 1. PG&E said it was not immediately available for comment.
DOWNGRADES
PG&E said it defaulted on $43 million of commercial paper as of Wednesday, while Pacific G&E defaulted on $33 million. The defaults came after their lenders on Tuesday blocked them from drawing on their credit lines. The parent said it has cash reserves of $347 million, while Pacific G&E has reserves of $700 million. The parent said Pacific G&E has no borrowings under the defaulted $850 million credit line, which is now being fully used as backup for the unit's commercial paper. It said Pacific G&E has $873 million of commercial paper outstanding, of which $437 million will mature by January 31. Pacific G&E also has a $1 billion credit line, but as of January 16 has drawn down $938 million under that line to pay commercial paper, PG&E said. PG&E said its $436 million credit line backs up its own commercial. PG&E said it has $501 million of commercial paper outstanding, of which $263 million will mature by January 31. Separately, PG&E said Pacific G&E said it owes $420 million to various power generators in early February, and $410 million in early March. The utility is seeking to avoid having to pay for power delivered in January until April 1. Moody's on Tuesday its bond ratings for Pacific G&E and PG&E on Wednesday to a respective ``Caa2'' and ``Caa3'' on Wednesday, and its ratings for their commercial paper to ``Not Prime.'' S&P on Tuesday cut its equivalent ratings to ``CC'' and ``C.''
Black Blade: So the "Cascade Effect" begins. Two defaults in two days. The Grasshoppers get a tiny taste of what is to come. It will take years to overcome this crisis, and still the Grasshoppers refuse to build in their backyards. Shove the burden on others in other states. They are about to undergo a bit of Hydro-Carbon withdrawal as out of state producers refuse to subsidize their lifestyles. The world's seventh largest economy is about to have the wonderful "liberal" experience of 3rd world living.
Many GoldBugs feel somewhat disinclined to accumulate Silver, prefering Gold
as the Better. Better preserver of wealth, in times of economic and social
distress. Y2K. Y2K1. HyperInflation. DisInfaltion. DeFlation. Things like that.
Did I mention StagFlation.?. Whatever.
Gold is prefered because (they always say) it's more compact. More dense. More
wealth-per-ounce. Easier to store. Hide Etc. Historically that's always been
true and will certainly continue to be true. Truth is Truth.
Platinum (and even now, Palladium) could be said to be even more-so. Compact.
And at such soaring prices, toss in CapGains as a plus. But there is no historical
precedent for Platinum/Palladium. Why.?. Because those two heavy-metals weren't
even discovered until the 1940's. Too late in history to have ever been used for
coinage and trade, by anyone, anywhere, anytime.
Today's saoring prices of Platinum-group metals (Platinum/Palladium/Rhodium) are
not likely to exceed Gold's price in the collapse of an economic/industrial system.
Because their primary use in is industry. As technical metals, and catalysts.
If the worldwide economies tank, there will be little demand for either. So be
cautious if you plan or think of using those as preservers of wealth. You may
get blindsided by their price collapse. A few years ago, Palladium was only worth
about 1/3rd the price of Gold. It could happen (quickly) again. It's now triple the
price of Gold. Do not be disappointed to see it fall during bad times.
But what of Silver.?. Bulky Clunky Silver. There's ample history of it being the
common coinage of preference by the little guys, in trade as well as wealth
preservation. It was convenient because of its "smaller denomination". Most goods
and services are nowhere near the price of an oz of Gold. But were often easily
priced in Silver, in the marketplaces of the world.
And as I see it, the future holds promise for similar useage. Worldwide. When the
people finally loose faith in all their fiat paper currencies. It will come to
pass and is inevitable. Be patient.
Gold *is* Better. But when you "spend" your Gold-coin, think about what you will
be pleased to accept "in change"... Silver ... "Change" for the "Better".
Richardson again orders power suppliers into Calif
http://biz.yahoo.com/rf/010117/wbt022931.html WASHINGTON, Jan 17 (Reuters) - U.S. Energy Secretary Bill Richardson extended on Wednesday afternoon an emergency order requiring firms to sell electricity to California's major utilities, but will wait until Thursday to decide whether a similar order should be issued for natural gas suppliers, an Energy Department spokesman told Reuters. Out-of-state suppliers have been reluctant to do business with California electric utilities teetering on the edge of bankruptcy, fearing the utilities will not be able to pay for their power. Richardson extended until midnight on Jan. 23 a prior order forcing firms to continue supply electricity to the utilities. He said the Energy Department was prepared to enforce terms of the order against firms that fail to supply surplus power to the California market.
During a meeting earlier in the day, Richardson and his designated successor, former Michigan Senator Spencer Abraham, agreed to extend the power order through the incoming Bush administration, which takes office this weekend. Separately, Richardson will decide on Thursday whether to issue a first-time order requiring natural gas companies to supply gas to the California market. California Governor Gray Davis made such a request over the weekend after Pacific Gas and Electric (NYSE:PCG) said more than a dozen of its natural gas suppliers refused to sell the utility gas on credit.
Black Blade: From what I hear, the out-of-state suppliers have given the lame-duck Sec. Of Energy the proverbial "finger." With 3 days of employment left, the industry gives him as much significance as the ME oil producers did this week. Bill Richardson will be nothing more than a fly-speck in history.
http://dailynews.yahoo.com/h/kpix/20010117/lo/cost_of_living_in_bay_area_on_the_rise_1.htmlBy KPIX - BCN
The U.S. Department of Labor reports the overall cost of living in the Bay area increased more than 5 percent last year, according to the latest consumer price index statistics. Leading the way, according to the department's Bureau of Labor Statistics, was the cost of housing, which rose 7.5 percent in 2000. Rent increased nearly 9 percent over the last year, and increased more than 2 percent over the final three months. Also contributing to higher housing costs in the Bay area was the price of natural gas, which surged 13 percent in December and gained more than 60 percent on the year. Although gasoline prices dropped more than 5 percent since October, statistics show that gas prices gained more than 20 percent for the year. The price of groceries increased more than 4 percent during 2000, and alcoholic beverages showed a rise of more than 5 percent. The Bureau of Labor Statistics says goods and services that would have cost $100 in the early 1980s, cost consumers $184 in December 2000.
Black Blade: I guess that they didn't get the news � inflation has been tamed! Look at the CPI and PPI numbers. Why heck � even Larry Kudlow says that inflation is over because gold is lower. Who are these guys kidding � inflation is "benign." ------- In a pigs eye!
Davis Declares State of Emergency Over Electricity
http://dailynews.yahoo.com/h/kpix/20010117/lo/davis_declares_state_of_emergency_over_electricity_1.html By KPIX - BCN
Gov. Gray Davis tonight declared a state of emergency in the state over a growing electricity crisis that caused rolling blackouts in Northern California for part of the day today. "It's our obligation to step in," he said in a brief statement. Davis said he was calling a special legislative session tomorrow to ask that funds be set aside on an emergency basis to "keep the lights on" for the next week to 10 days. He said he had also conducted a long conference call tonight with four major power generators, who promised to cooperate with his plan if legislative action is taken by 12:01 p.m. tomorrow. Davis said officials would be working through the night to close a power gap currently estimated at 14,000 megawatts for tomorrow to avert another day of uncertainty in California's homes and businesses.
Dow Jones News Service, Via The Associated Press
NEW YORK (Dow Jones News) - Crude futures fell sharply at the New York Mercantile Exchange Wednesday in the market's initial reaction to a decision by the Organization of Petroleum Exporting Countries to cut output by 1.5 million barrels a day from Feb. 1. Nearby crude futures plunged more than $1 in intraday trading, however, traders hedging their bets at the close amid thin volume trimmed about half the losses of crude and heating oil futures. February's crude contract finished the day at $29.60 per barrel, down 69 cents. Heating oil for February delivery declined 2.59 cents to 81.52 cents a gallon.
After markets closed, the American Petroleum Institute reported that U.S. inventories of crude grew by 2 million barrels in the past week, while reserves of distillate fuel, which includes heating oil and diesel fuel, contracted by more than 3 million barrels. OPEC Secretary-general Ali Rodriguez said the group could cut another 1 million barrels a day at its next meeting March 16 if the market remains weak. Although prices popped briefly on the news, since many anticipated the next cut at 500,000 barrel a day, prices fell steadily through the session. The specter of Iraq's exports returning to normal levels weighs heavily on the petroleum complex, analysts said. Analysts said the OPEC cut was effectively a wash as Iraq's exports resume. Iraq's ambassador to Vienna attended the OPEC meeting, and said his country will be producing fully by Feb. 1 - about 2 million barrels a day in exports and 800,000 a day for domestic use. OPEC President Chekib Khelil has said that output cuts would take into account Iraq's disruption of exports. The cartel would adjust production to reflect changes in Iraqi exports over time, Khelil said.
A slowing global economy are expected to continue pressuring crude and refined products futures. Warmer temperatures for most of January have kept heating oil under steady pressure. Stocks currently stand 8.5 million barrels below year ago levels. U.S. reserves of distillate fuel, which include both heating oil and diesel fuel, dropped to 115 million barrels from 118.2 a week earlier, API reported. A year ago, there were 123 million barrels of distillate fuel on hand. Crude oil inventories in the United States grew to 290.4 million barrels for the week ended Jan. 12, compared with 288.5 million barrels a week ago and 294.6 million barrels a year ago. Motor gasoline inventories, API said, declined by roughly 500,000 barrels to 197.9 million barrels, compared with year-ago levels of 196.6 million barrels. February unleaded gasoline prices declined 2 cents Wednesday to 85.79 cents a gallon. Natural gas futures were down $1.19 to $6.91 per 1,000 cubic feet. In London, Brent crude from the North Sea sank 73 cents to $24.79 per barrel.
Black Blade: Winter's not over yet, and NG storage drawdown continues. Meanwhile, energy crisis continues to worsen. The economy contionues to slide into recession. "Interesting Times" lie ahead.
http://biz.yahoo.com/rf/010117/l17265105.html LONDON, Jan 17 (Reuters) - Gold managed to pick up from 16-month lows set early in the session, finding sustained physical support at the lower levels, traders said on Wednesday. The platinum group metals (PGMs) spiked briefly after comments from the head of state precious metals and gems repository Gokhran that the signing of export quotas for Russian PGMs would be delayed until February.
Gold ended the session around half a dollar firmer after dipping to fix in the morning at $263.10 a troy ounce -- the lowest fix since September 22, 1999. Traders said the market would remain under pressure and rangebound ahead of next Tuesday's Bank of England auction of 25 tonnes bullion, but physical demand was reasonable around the low $260s. ``Gold is finding sustained physical support...as indeed it should do at this time of year, but the speculative elements are playing the market from both sides and the bias remains downward in a narrow range ahead of next Tuesday,'' said Rhona O'Connell of Canaccord Capital. By the close, spot gold Silver In the PGMs, palladium Black Blade: Don't expect anything out of Russia. This is a long played scenario � Russia claims that it will ship PGMs. Reality � none shipped. Reality � Japanese TOCOM traders are extremely gullible and buy against all hope. Reality � PGM stockpiles are depleted. Also, rumor is that our good ole friend Andy Smith (Gold Bear) of Mitsui Metals is talking down palladium now. He is losing credibility fast in the investment community with such outrageous drivel. Shorts could easily get horrifically whip-sawed if not careful, especially now.
As Harry also says (as so do I ) the media always shouts with some degree of jubilation when gold is being sold - and who sold it. But they are most silent about who is buying it. For every ounce sold, an ounce is bought -" they don't just push it over a cliff"
"Moscow says it'll not buy diamonds in 2000-2001 but instead to buy gold. GATA comment: "West selling gold as East buys it. They forget old motto: He who has the gold makes the rules."
Watch for the Euro reaching dollar parity and FIRMING, then sit back and ride the GOLD WAVE. It will be just ripples at first, growing into bigger ones later - you know, the kind you can surf on.
Are we out of the woods yet? Not entirely... Winter gas storage
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The American Gas Association said that US natural gas storage levels appear adequate for the rest of the winter. AGA said November and December 2000 were the coldest such months on record, according to the National Weather Service, resulting in higher gas bills for consumers. David Parker, AGA president and CEO, said, "Residential natural gas customers got hit with a double-whammy this winter: record cold weather in November and December, on top of nationwide increases in the wholesale price of each unit of gas."
Parker said because of the very cold weather the last 2 months, levels of gas in reserves were lower at the end
of December 2000 than at any comparable time during the 7 years the association has been tracking working gas
levels in underground storage. But he emphasized that storage levels appear to be adequate to meet remaining
winter needs. "Today, there is more natural gas held in underground storage -- 1.73 tcf -- than has ever been removed from storage during the remainder of any of the last five winter heating seasons," Parker said. Gas storage accounts for about 20% of the volume used in the winter heating season, from Nov. 1 through Mar. 31.
Higher prices
~~~~~~~~~~~~~~~~~~~~~~
Meanwhile, the US Energy Information Administration said consumers may pay 70% more for natural gas this winter. In its latest short-term energy outlook, EIA said, "Very large increases in heating-related demand appear to have materialized in November and December, resulting in a sharp reduction of gas available in storage to well below the previous low recorded by EIA. "The end-December 2000 estimated working gas storage level is approximately 10% below the previous low seen since 1973, which occurred in 1976. Continued strong demand (from normal weather) this winter would keep gas stocks at minimal levels for the remainder of the heating season and ensure strong injection-season demand next spring and summer. "We see average gas wellhead prices as averaging about $5.20/Mcf in 2001 (compared to an estimated $3.70 in 2000) and about $4.50/Mcf in 2002."
EIA said homeowners using distillate oil will pay about 40% more this winter, despite recent drops in crude oil prices. EIA said heating oil lower prices were offset by higher demand, particularly in November and December, both of which had 28% more heating degree-days in the Northeast in 2000 than they did in 1999. "While prices have eased some in recent weeks, the heating oil market is still relatively tight and subject to significant volatility. Still, it is worth noting that, despite very cold temperatures over the last 2 months, the heating oil market has held up
rather well."
Black Blade: We may have dodged a few bullets this winter, however, the winter season is not yet over and draw-downs will continue throughout the summer for NG-fired power generation. Power use will likely be high as people will continue to use air-conditioning and the so-called "New Economy" draws on ever increasing energy for high tech equipment and computers. Also note that every available drill rig is in use and there are no more, yet NG stores are lower. What does this portend for next winter? It should also be noted that these storage levels are based on national averages, and that regional stores and decline rates will vary - definition: some areas may yet run out of NG supplies.
Attn: Pandagold; Holtzman; Others of Europe...My questions concern the taxation upon an individual person
whenever he/she might purchase Gold or Silver coins/bullion
at their local European coin shops:
Is there a Sales-ax or VAT Value Added Tax they must pay.?.
And are they secondly, taxed every year afterwards on a
personal-belongings-property tax upon those coins/bullion.?.
If so, what are the various tax rates applicable.?.
I'm just wondering, to see if the taxes in Europe affect in any
way the demand for personal bullion and hence it's price there.
TORONTO (Dow Jones)--A Barrick Gold Corp. (ABX) spokesman declined to comment on rumors the gold producer might be planning a bid for South Africa's Gold Fields Ltd. (GOLD) in conjunction with AngloGold Ltd. "We don't comment on rumor and speculation," the Barrick spokesman said. Market sources in South Africa said they believe Barrick may be examining teaming with AngloGold to acquire Gold Fields, a major producer. But the talk involving Barrick remains speculative. Barrick, one of the world's largest gold producers, has often been named in rumored deals that have never materialized. AngloGold has long been seen as a suitor for Gold Fields,which last year had attemped to merge with Canada's Franco-Nevada Mining Corp. (T.FN) That merger was thwarted by South Africa's finance ministry, and the planned tie-up appears scrapped. But the ministry is taking another look at the proposal, which may provide a possibility for the merger to be resurrected. Shares of Gold Fields slipped 3.125 cents to $3.375 on the Nasdaq Stock Market Wednesday in 4 p.m. trading.
-Mark Heinzl, Dow Jones Newswires; 416-306-2014
Black Blade: I hope that this isn't true! If you have Gold Fields shares, register them in your own name, or transfer them to a Drip-Type account such as BuyandHold.com so you can vote the proxy to stop such a tragedy! If Barrick and Anglo puts their claws on unhedged Gold Fields, they will short the hell out of all production and further damage the gold industry and push gold down beyond recovery. These scumbags must be stopped! Also, write to Gold Fields institutional shareholders and work to convince them that this is a terrible idea! Maybe adopt a "poison pill" to prevent that kind of disaster would be a very good idea!
Gold and silver up, Chinese favor Euro, etc. "Interesting Times" ahead?
Gold is perking up this morning +$1.80, at $265.20, and silver is up 3 cents. Only 45 minutes until the usual NY splash-down though. Euro up, USD down, petroleum up, and round and round. Futures are mixed with no firm direction. Could get interesting today as Chinese are said to favor moving to Euro reserves over the US Dollar. It just might get fun if Wall Street catches on. Only 2 more days until the Clinton PPT crowd hand off the ball to the Bush team. Monday might signal a shift in direction, then again it just might be business as usual. Looks like George Dubya Bush will wear the mantle of the Hoover legacy before long while Bubba slinks outta town.
http://www.inquirer.netMonetary officials move to halt rumours of bank holidays
Posted: 8:07 PM (Manila Time) | January 18, 2001
By AFP
MONETARY officials on Thursday quelled rapidly spreading rumours that the banking industry was in dire straits amid a political turmoil resulting from President Joseph Estrada's virtual acquittal on graft charges.
"The banking system is inherently sound and there is no reason for banks to declare a bank holiday," Central Bank of the Philippines deputy chief Alberto Reyes said in a statement.
Reyes said the central bank "recognizes that rumor-mongering can be attributed to the general concern on current political developments."
Philippine stocks and shares have been taking a beating after the country was plunged into political turmoil this week when the Senate voted along party lines to virtually acquit President Joseph Estrada on an array of graft charges.
At least 10 major business organizations have also joined massive protests calling on the president to stand down, while labor groups vowed to stage a work stoppage in the coming days.
Reyes said he issued the statement after banks reported having received continuing queries from clients on supposed impending bank holidays to sweep the industry.
He said the rumours were also being circulated through text messages on cellular phones.
The central bank however "stands ready to defend the integrity of the financial system and to provide immediate assistance" to banks in case of need, Reyes stressed. AFP
To Anyone: How high does inflation have to be before it's hyperinflation? I believe FOA once mentioned about prices rising 50% a MONTH. Then yesterday I read 25% a year inflation being called hyperinflation. Does anyone have a good definition? Thank you!
In the glossaries in his investment books, Harry Browne defines hyperinflation as runaway inflation.
He defines runaway inflation as a rapid increase in prices aggravated by a widespread drop in the _demand for money_ .
... Any of these should alert you ...(1) Grandmother sends you to the store to buy a quart of milk:
and she gives you her 1920 copper penny to pay for it.
(2) A dime has more intrinsic value than a thirteen dollar bill.
(3) You experience Sticker-Shock at the price of a bread loaf.
(4) Tuna Cans are displayed above the Prime Beef Section.
(5) Eggs are already colorfully painted. And hollow.
(6) You pour Grandma's milk: Find that it's powder. Add water.
(7) Dollars are Traded at CBOT, like Wheat: In Bushels.
(8) Gold trades at COMEX at $265.50/oz
(9) Your calculator no longer has enuf digits to show the DJIA.
(10) Don't worry. You will never see HyperInflation in the USA:
The government will call it something else: "Stable Prices".
Is this the 'luck o' the Irish', or those dear little Leprechauns at it again?
"THE Emerald Isle has a "border of gold" between Armagh and Monaghan, which has begun to yield its rich bounty, according to the Irish exploration company prospecting in the area."
(The Irish News)
In his essay 'The Supply of Money and Changes in Prices and Output', Milton Friedman defines hyperinflation as the kind of price rise that seriously distorts the effective use of resources.
Some of my friends (and apparently many readers) often ruminate on why I am so fractured when writing. Often giving the impression of rambling on, not to mention a poor english structure, spelling and grasp. Someone asked, "Your not that way in person, so why such a literary style?" I'll try to
answer what I did strive to explain once some time ago.
My full grasp of english is somewhat poor. But, that's because of a mental structural problem induced by a worldly exposure. With that simple reply, I'll leave it to your best imagination's ability, to decipher (smile).
A better reply, though, would be; it's just my way of following a format introduced by Another. In other words, in his words to me with my (words added) -----
"one should not tell readers (his) exact knowledge, position in life, or what (other's) thoughts should be. Such (talk) extols the self and lessens the reason pursued. (Rather,) let anyone that will listen, think your Thoughts (thru), seldom exposing (them) to (your) fully concluded points. They (people) gain our understanding on (their) own terms, in (their) own way, in (real) events, over time". He
often said; "we are not (here) to prove things, my friend, time will do (that) for us. It (time) will (also) expose (our) standing in world of Thoughts" and "is it not better to stand (in) a crowd and speak softly to (the) nearest ear" and "truth (is) never hidden or (not) exposed, it (is) simply not reasoned by exposure to understanding".
So, (smile)
Two roads diverged in a yellow wood,
And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could
To where it bent in the undergrowth;
This is the first part of Robert Frost's fabulous classic, as printed above the USAGOLD Walking The Gold Trail page. I'm not sure if it was Randy or MK that choose it, but it was perfect in all the ambiguity such words could convey. For thinking, reasoning people it creates an air of where we
are today. We have rounded "The Curve" of understanding and now must contemplate the trail to follow. Truly, most everyone knows, now, that there are two paths we can go down. Each path denotes following it's own economic block, world currency block and gold price structure block.
Indeed, our future quality of life may depend on how much we understand about these two paths.
Trail Guide...glad you liked my choice (with MK's full blessing) for your page...seemed fitting, both beginning and end
http://www.usagold.com/goldtrail/ I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I--
I took the one less traveled by,
And that has made all the difference.
-------------
CNBC news banner: December housing starts +0.3 to 1.575m rate
Now for the rest of the story
actual starts Dec 00 - Dec 99 -12.5%
actual permits " " -17.7%
Just like all fiction coming out of the government seasonally adjusting figures takes the truth out. These are the largest single month drops in a long time. Actual permits are important because it gauges business 60-120 days forward. The spin now must be "the second half story" because they know the next few months are assured disasters.
[Bridge News] Johannesburg--Jan. 18--South African gold producer AngloGold and Canadian
rival Barrick Corp on Thursday declined to comment on mounting speculation that
the two companies were preparing to launch a joint hostile bid for control of
Gold Fields, South Africa's second-biggest producer. A reliable source had
earlier told I-Net Bridge the joint bid was expected to be made by the end of
this week.
-------------------------
When a hedge fund (such as Barrick) is looking to get into the gold mining business directly (via Gold Fields), one cannot help but think that things are seizing up in the physical market. Of course you know, just looking at prices you would not be able to detect signs of this tightening due to the "off market" method of price discovery that is used for gold. No one is running out of contracts to sell(!) Rather than look for the gold derivative prices to show a rise, look instead to expect this paper gold to be trading at a discount to the prices offered for true metal. Paper can be everywhere, but gold...either you have the metal or you do not, at ANY price.
Randy (@ The Tower) (1/17/2001; 11:20:40MT - usagold.com msg#: 45784)Excellent! Here is only a small excerpt from MK's FULL report today -----------
Randy,
Yes, that MK is something! While I cannot get his entire News & Views, what you have provided speaks volumes of a mind endowed with good reasoning. His vision is well positioned to navigate and understand this modern money world around us.
------------
I have this to add:
Who among us, ten or twenty years ago, would have ever thought the fed would still be exploding our dollar production today? Back then, such an "inflation of the currency", over this long a time span, was unthinkable. It would surely lead to an immediate destruction of the dollar. But, here we are, watching as dollar production is gunned for the ????? time.
Everyone with any knowledge at all, the Ruffs, the Browns, the Schultzs, etc.,,,, all knew any such currency inflation, as we see today, would send the world off the dollar standard! Where would we all go for money relief? Why, gold and silver, of course! But, what happened? Well, the world
economic structure changed and those extra years sold time to others for the creation of Another currency.
You see,,,,,,, this was the trick (or ploy) of "one world trade". This concept alone produced the extra demand that needed "trading dollars". This short term transition, aided with cheap oil deals, demanded "digital money" for trade, not savings. It was this new "one worldeconomic expansion
demand" that put our dollar so much more "in play" for it's settlement function. It's value as a savings utility was not in demand, but it's need to denominate and close settlement was. This exceptional surge in trading demand overcame it's loss of demand as a "holder of value".
However, this "digital need" would not alone, negate the run into gold others forsaw. For that sector, our new currency creators needed an overflow valve that would cover this demand. Paper gold! A devise pushed at first by all dollar users.
But what of all the dollar instruments floating around? Cash dollars, near dollar like securities and even Treasury issues? Even they are not the static holdings we knew them as twenty years ago. These paper digits are but commerce receipts and are now a 1000 times more fluid. In fact, few of us can say that we actually have an account that these things are deposited in. Yesterday, instead of real deposits, we owned "deposit credits" and account credits. Bad enough to own them then as it created doubts of redemption. Today, however, we own "deposit credits" of "deposit credits"! In other words, our entire money universe if completely liquid and fluid in nature. We as an American
Western society own no form of a stable currency structure. It is completely a "digital settlement receipt" money.
In this fashion, no form of trade slow down can be allowed. Economic slowdown today, is the death of dollars on a scale never known. Where dollar assets and liabilities, matched on banking books, would once cancel out, creating just a simple alarming deflation,,,,,,,,, today, one dollar loss wipes out hundreds of dollar derivatives assets based and created against that one single deposit credit asset. Even a minor slow down will have the effects of a colossal banking failure. Therefore, the Fed is now in a different universe than the one most economic forecasters are following. It's not a case of changed rules,,,,,, it a case of a completely different environment.
The fed must create an inflation on top of an inflation. To not do so, they will immediately concede the currency world to the "old world's" new currency and it's physical friend. Gold! Even most Euro doubters are beginning to see this new light:
----"Picking a new currency to switch into may seem tricky, but there are only a few sound choices. The euro, a currency nobody ( including us ) had a nice word for in a year, is now one." --
---http://www.gold-eagle.com/gold_digest_01/schultz011901pv.html----
So,
This, my friend, is the new dollar money world we have evolved into. A process that has expended the value and timeline of any and all dollar based assets. As Another said; "your wealth, it not what your dollar say it be". Indeed, what we own is but a shell of a transitional world currency system. Somewhat like owning the common stock of a trading shell company. No assets, but still has a useful bid? It leaves us with little value once it's digital bid, it's "USE FACTOR" moves on and that factor will leave if the world economy slows in the slightest way. In common language, a recession will bring the Western dollar world a modern hyperinflation the likes none of us have ever seen or
read about in our time!
Major players in the gold world have not been blind to this ending dollar timeline. Physical gold is not off their radar screen, just paper substitutes hard money assets not backed by Euro governments! They are not blind to the continued use and need for paper gold to govern the dollars slow demise. Collapse this paper gold world too fast,,,, and the dollar is toast,,,,, too fast!
Indeed, without a Euro to take over the dollars "digital roll" we would be headed for an full blown economic nuclear event. Something oil producers are loath to accept. To this end, the Euro is forced to survive,,,,, warts and all! It will also be physical gold that carries the bulk of past dollar inflation, and the wealth that represents, in the form of gigantic dollar gold price increases. The world's wealth, as denominated in money will not disappear, it will only change hands and form as it supports a new currency system. CB gold is today, traded as an asset, not sold as a liability. Only Western Media reports 1/2 this fact to extend paper gold's decent.
Gold substitutes? Who needs them when their value is based on a failing paper price structure.
Today, who knows the price for physical gold?
It has no market price in our dollar world!
Physical Gold Tomorrow? It will outperform every other asset ---- because it's value as wealth is so misplaced in our time------
As MK so boldly observes;
-----"There comes a day of reckoning..."-----------
Is it realistic to talk about the dollar declining in what could be described as a "crash?"
~"When they deregulated [electricity], The State of California did
everything wrong. They are now on a sinking ship and they're going down
unless they stop fighting among themselves. The state is going to have to
buy power and sell it to the utilities. There is no other solution now.
Who will pay? The taxpayers will pay. This may not prevent bankruptcy of
these companies anyway. Will bankruptcy of these utilities crash the
dollar? I don't think the dollar will crash, but this will definitely
put pressure on it." -Chief Commentator Bill Seidman, CNBC, Jan. 18, 2001
There is an easy rule of thumb: If everyone is talking about "inflation" at the super-market check-out, etc. you're in a hyper-inflation.
"Hyperinflation" is a less than precise term --- mostly because the rate of change of inflation during hyperinflation is variable and high. That's because it all happens very quickly. The result is that the rate of inflation is a quickly moving target and it allows different folks to pick their own figure.
In a sense, we've had hyperinflation since they abrogated the gold standard in 1933 - - - the dollar has hyperinflated in that period to be worth less than seven cents (7%) of it's value in 1933.
My mother, who grew up and still lives in the Detroit area and is 78 years old, used to go to the movies for a nickel. Yes $0.05. This was in the early 30s.
In the first week of the new year my wife and I were in Manhattan visiting family and went to see Castaway.
Price: $9.50.
We do get color now though. But what happened with all the new technology in the last 60 years? I'll have to ask Easy Al next time I see him.
Finally, a discussion which is just as important as acquiring gold and silver. Yes, How to spend your assets and what will you accept for change. Just trot on down to your local bank, drop a couple eagles on the counter and pick up a few of those fiat dollars we all like to spend. Sounds simple enough. There are many reasons why people buy gold and silver as stated in message 45817. You can "Flation" yourself to death. Bottom line, gold and silver are at the top of the food chain when it comes to financial transactions in very stressfull times. History proves this out. Yet, water in the desert and food when your hungry could be a higher value. Is the trick to use one to get the other at a fair price? What is Fair Price? How much gold or silver. Will the price be driven by supply and demand or the precieved value of the buyer and seller. Further arguement can be made as to use coinage or bullion. Aye, Matey, me thinks you shave too much off me silver bar! Coins after 1964 have no value to me. To me silver is the way back to stability. Silver in the coins and notes backed buy silver.
Can not stand this new paper money. Monopoly Money. I WANT SOMETHING OF REAL WORTH! I will accept silver as change. No paper mony please. Say if there is hyperinflation and the fiat money is worthless, Who gets to set the price of gold and silver. The banks or us?
Here is a sample of his direct message (regarding physical gold) from a lecture offered at this time last year:
--------
Physical Gold
Buying physical gold at these levels and taking delivery is a very effective way of hedging against future turmoil, including delivery problems that must occur in the gold futures markets, as well as ludicrous stock market valuations that cannot go on forever. It's safe, convenient, won't evaporate and it's yours. Even if further declines in the gold price occur, still a real possibility, it is likely that they will be short lived.
+
Taking delivery now provides more leverage than most people believe. You own the gold and as this market eventually returns to something that reflects the reality of the supply and demand situation, the premium will be on physical metal. Given the nature of the markets at present, the amount of paper currencies in the system, the potential for all sorts of "corrections" and the fact that paper promises are at the end of the day worthless, holding physical metal as a percentage of ones assets, is definitely prudent.
+
There is no speculation involved in deciding the actual content of either a gold coin or a 10 ounce bar. The content is what it is, 99%+ pure gold, and as such is not dependant upon dubious market perceptions, management accounting practices, or the greater fool theory. Nor does it need to be watched every day. (As an aside, I have not heard of too many bullion dealers receiving daily phone calls asking for quotes on the current purity of their clients' gold bullion).
------------------
Be sure to look into the whole series as your time allows...(accessible via the Gilded Opinion index page)
What the BIG miners (and Bill Griffeth) think about gold - - - AND copper @ALL
-Bill Griffeth: ~"But what about the supply and demand for gold? Isn't the
demand for gold greater than the supply? ~"The central banks are the OPEC of
gold. They will control the price of gold by selling untill they change
their minds." . . . "There are only three weeks of copper left. When the
price of copper goes to $4 or $5, people will be saying, 'Why didn't anybody
tell me this?'" -James Moffett, Freeport-McMoRan Chmn. & CEO, CNBC, Jan 18,
2001, ~12:43PM EST
I would like to welcome Professor von Braun and his Rocket School of Economics to the USAGOLD web site. A personal friend and confidant, the good Professor remains one of the people that I bounce my thinking off to see if there are any holes in it. He is astute. He writes well. And most importantly, he offers a message nurtured through many years experience in the gold industry. I believe our clientele and visitors will find his writings refreshing and usually ahead of the curve.
Welcome, my friend. We are proud to have you join the fine group of writers and thinkers we have assembled here for our mutual benefit and financial well being.
I would like to commend Randy as well for a another job well done.
"State regulators came Wednesday within 1,300 megawatts � enough electricity to power 1.3 million homes � of ordering the first statewide blackouts since World War II."
Journeyman (1/18/2001; 10:49:22MT - usagold.com msg#: 45852)
What the BIG miners (and Bill Griffeth) think about gold - - - AND copper @ALL
-Bill Griffeth: ~"But what about the supply and demand for gold? Isn't the
demand for gold greater than the supply? ~"The central banks are the OPEC of
gold. They will control the price of gold by selling untill they change
their minds." . . . "There are only three weeks of copper left. When the
price of copper goes to $4 or $5, people will be saying, 'Why didn't anybody
tell me this?'" -James Moffett, Freeport-McMoRan Chmn. & CEO, CNBC, Jan 18,
2001, ~12:43PM EST
ME
What has to be understood is the psychology of the human being. Aside from gold's good fundamentals and its its historical importance is the addictive nature of 99.9% of the human race.
Most investors today are no different than womanizers, drug addicts, alcoholics or addicted smokers. Don't believe me? Simply note that the markets are now so heavily invested by single investor types vs the institutions. Who ran up the Nasdaq? Answer, as if you don't already know, is the guy next door. And there are thousands upon thousands of them.....all waiting around the corner for the next cycle to latch onto. I have seen it at Mobil meetings...."did you see YAHOO today?" "Yep I put another 10k into it!"...over and over and over it was the same story....I was left wondering the last couple of years who was running their businesses. People are addictive. Don't believe it? Your eyes are not open. When gold goes this time, whenever that may be, there will be hoards of investors who have money and many who don't, who will be looking for the next shiny investment that looks like it will take them for a ride to riches. Alcohol takes you away from your problems. Drugs do the same and make you king for a day. Cigarettes give you that "whew, I needed that break" from life. Many who invest today, simply do not want to work any more. Period. Nasdaq promised it for awhile and gold will too. That is the added jump we will all see. Watch your fundamentals. This way you can have the fun whilst the rest can get or go mental. Gold will , in its time, provide itself to be used as an opiate for many. as it climbs, we will hear, "'Why didn't anybody tell me this?'"
. Many bankers will know,
Back to the dungeon. when I get time I will clean up my Second Ammendment post, I have learned a good many things in the last couple of months.
Thought yourself and others might be interested in this excerpt from Max Shapiro's "The Penniless Billionaires" (1980)
From the level of 122.5 billion marks on January 1, 1922, the total number of marks streaked to 206.6 billion, by the end of July, and increase of over 80 billion in just seven months. The glut of paper marks reflected itself on the foreign exchange market: from a price of 174 to the dollar on January 1, 1922, the mark sank to the quoted price of 770 to the dollar (having been worth 20-odd cents before the war, it had an exchange rate of 1/35 of a cent in July 1922).
Although foreign exchange fluctuations were of vital concern to speculators, businessmen, and the government, they had no recognizable significance for the average German. But the sweep of inflation had and unmistakable impact. During the seven month period (January through July 1922) the wholesale price index leaped from 34.9 to 100.6.
In the hot, sullen summer of 1922, Berliners were paying prices that were 100 times as those prevailing before the outbreak of the war in the comparatively carefree summer of 1914.
A pair of shoes that could have been bought for 10 marks in 1914 was now priced at 1000 marks. A pumpernickel loaf, priced at 40 pfenning (four-tenths of 1 mark) in prewar days now sold at 30 marks. A coarse shirt that would have found few buyers in 1914 at 3 marks would---in the summer of 1922----disappear the moment a weary salesgirl displayed it in the store window, despite its price tag of 500 marks. It would be snapped up because the buyer wanted to get rid of his ever-cheapening money and because he knew that next week he could find someone willing to pay 600 marks. The second buyer, like the first, would not need the shirt; he---like everyone else in the population-was merely getting rid of his depreciating money and put it into anything that retained its value. The race to dispose of money and to put it into 'Sachwerte' ("things that retained their value") became a way of life, in fact, it became a major portion of life of life by mid-1922.
The powerful industrialists, of course, had understood the necessity of putting cheap money into 'Sachwerte' before 1922. From 1920 on, with money borrowed from banks and other financial institutions (money that had been ostensibly fabricated to finance the deficits of the government), they systematically built up their plants. And in the process of inflation swelled their profits, they repaid their debts with the great quantity of cheap marks they took in. "It was absolutely necessary to have large debt," Minoux (one of the agglomerators of the period) once said. "You borrowed 100 million marks in a year when your profit was only 40 million. You then spent your borrowings on building up your plant. Two years later---with the mark down to 1/50 of its worth from the time you borrowed, and your profits up to 2 billion marks-you could repay your whole debt of 100 million marks with only 1/20 of your bigger profits. By that time the worth of your plants that had cost you 100 million (but which really did not cost you anything since you used other people's money to build) were now worth over 5 billion marks. Really, you did not have to be clever in those (1920-1923) days to make a fortune; all you had to do is borrow and put the money into solid things."
What Minoux did not add, however, was that in order to borrow one had to be considered "creditworthy," and that the banks extended their swollen deposits and bank notes almost entirely to a small group of entrepreneurs----for the most part the officers and directors of the cartels who frequently owned or controlled the banks themselves.
And while industry was piling up assets, the losers---the rentiers and other members of the middle class---were being pauperized as they had been during the previous hyperinflationary episodes. The hundreds of Lotte Hendlichs (see USA post #44090 Dec 19, 00) who had squirreled away a modest fortune from which they had hoped to secure an income of 2,000 or 3,000 marks a year, and a genteel existence, were already ruined. Like their French counterparts during the early 1790's the pensioners, the aged, and anyone living on fixed income gradually sold the few 'Sachwerte' they still owned and applied for woefully inadequate public assistance (which could not keep up with leaping prices) or slipped into the final, death-producing malnutrition. But the winners were not greatly disturbed by the hard fate of the losers. In mid-1922, Hugo Stinnes, arch agglomerator of the period (who, by using borrowed funds, had amassed more industrial, banking, and mining companies than any other individual in recorded history) printed a public appeal in one of his newspapers for the issuance of additional marks by the Reichsbank�.Stinnes's newspaper exhorted, "There is a shortage of money. We must have additional money to maintain industry and order"
Comment: Leigh, (there is much more to this story) this inflation accelerates millions of percent from where I ended the excerpts and ends with the total destruction of the currency. The numbers get truly astronomical as evidenced by this next excerpt�."By the end of November (1923) with the mark having been rendered virtually worthless--the cost of living was driven to sickening heights. The wholesale price index as of November 30th had skyrocketed to an extraterrestrial height of 1,42,900,000,000 (almost one trillion four hundred twenty three billion times its 1913 level)"
Comment: There is hyperinflation, and then there is the German hyperinflation. The Debt taken on by US corporations since 1994-1995 is staggering, does anyone have these figures from Doug Noland's work?
I am slow, but after reading your post(which I found very interesting) it seems to my addled brain that you may be trying to make a connection between the German agglomerators' pre-inflation accumulation of debt, and a similar occurrence that has been going on in this country since the mentioned time period of 1994-95. Is that the case? Very interesting indeed.
Could not a poor man like myself emulate the agglomerators by maxing out my credit cards with the purchase of things of value, and paying off the loans after the inflation has taken its toll on the currency? I have been thinking of doing just that, and have been pondering the prudence of such an action. I would appreciate your opinion, and further insight into this matter.
It seems to be the commonly offered advice to "get out of debt." However, if someone is anticipating hyperinflation, what is the logic? As per mhchuck (01/18/01; 13:39:29MT - usagold.com msg#: 45858), you can emulate 1922 German businesses and go into debt, knowing you'll be able to pay back that borrowed money with inflated money.
Anyone know where the idea of paying-off your debts under such economic conditions came from? Is it just banking disinformation, wrong-headed cultural blather - - - or is there some logic to it that escapes me?
"Anyone know where the idea of paying-off your debts under such economic conditions [hyperinflation] came from?"
------------
Where generalized advice goes untailored for the masses, that is probably the safest route to take for the advisor.
Why? Because although it seems attractive to load up on debt to repay it later with cheaper dollars, there is no guarantee that the debtor will still have an income stream. As the inflation first erodes the purchasing power of the nation's "savings accounts", some businesses may suffer from slack sales and be forced to cut back on production with layoffs, or shutdowns in a worst-case.
On an individually tailored basis, the advice to reduce or increase debt upon the reasonable certainty of runaway inflation would have to take into account the ***reliability*** of that individual's future income stream, or of the availability of adequate assets that can be sold for the necessary quantity of currency when needed.
I guess that makes sense. Also, you know how I feel about predicitons (Yogi) so we could be wrong, people run up a lot of debt and then hyperinflation doesn't happen soon.
Of course, there's always bankruptcy! A lot of company there lately.
Hyperinflation and Future of Stock market - Anyone/Stranger ger
Since I was a boy in the '30's, I have seen an enormous amount of inflation (I also remember the nickel movies). In addition, I have seen the stock market more than keep pace, a lot more. If we have hyperinflation, does that mean the stock market will hyperinflate also? If not, why not?
VanRip: "If we have hyperinflation, does that mean the stock market will hyperinflate also?"
Depending on the particular company whose stock you are evaluating...some will rise, others will not. Of course it ultimately comes down to investor willingness to hold corporate assets, but some companies will thrive and some will fail based on the same conditions mentioned earlier to Journeyman regarding income stream...can the particular company maintain sales volumes (domestically and/or overseas) and also have the ability to raise prices to compensate for the higher costs of overhead? Those with a focus on exports would tend to do better than others.
And I join with FOA to point out another item. Not only will gold run with the best of the pack on the response to inflation of the currency, the physical metal will also uniquely enjoy an additional springboard effect on its price level from a disolution of the price-setting gold derivatives markets.
The 1st Lips Will Be Moving Again TonightJust wondering what is so important that must be personally spun by Sick Willie hizzelf, in a precedent setting manner?
Maybe it's just one more "for the show" from the guy that's having a hard time letting go.
Just part of the blame game, reminding the believers how great everything was on hiz watch, right before all hell breaks loose--markets, recession, etc.
Could be even more significant as he would surely know of any meaningful departure from recent {YEARS!} Treasury m.o., that is soon heading our way.
Watch closely, if you are able, read his moving lips and discern what the underLIEing reality is.
I believe the debt we need to be rid of in inflationary times includes debt with variable interest rates, debt which would be difficult to service in a faltering economy and debt with balloons or acceleration clauses.
However, debt on an asset outside the above caveats might be valuable. For example, an investment in a mobile home park financed with a fixed term and fixed rate might work well. A mobile home park could possibly be an asset with a strong pay back during hard times (people have to live somewhere). I chose mobile home parks as an example because they worked well for me in the late 80's.
Journeyman, In addition to the other responses, I would think that "getting out of debt" is definitely the strategy for Deflation. With the deflation in the thirties, and dollars being hard to come by, those who had excessive debt had to default and saw their homes and property repossessed. Since 1913 we have had a gradual, but nonetheless significant inflation that has proceeded in stops and starts. The Fed is always threatening to "pull the plug" (the fighting inflation rhetoric which is in essence a claim that it, (Fed) is always fighting itself). If you KNEW we would have hyperinflation, or even moderately accelerating inflation, then going into debt is a sound strategy. The problem is that we are not privy to that information. And as much as all indicators point to inflation, tomorrow the Fed might change its mind and pull the plug. That is only one reason why this private and arbitrary system of money creation is so unfair.
Christopher, I certainly was thinking that the rapid build up of corporate debt in past few years is revealing a clue about future monetary policy. I thought I had recently seen a chart that indicated that corporate debt had quintupled since 94-95, but am not certain my memory is accurate, and asked if someone could provide more specific information. As to maxing out your credit cards? In a rapidly accelerating inflation it would work, but then, nobody would be extending you credit. I think it's better to buy gold. There is trouble with the monetary system, the knowledge of which is being withheld from the world. That is why gold is only at $265 an ounce.
www.PROdigitalRecords.com In case there are any classical music fans here tonight, my website (http://www.prodigitalrecords.com/) has been updated. New graphics along with a whole new department: MP3 Downloads. The MP3 files are free and one features me playing a short piece by Hans Sitt for viola and piano. (http://www.prodigitalrecords.com/PROdownloads.html)
If anyone does go by to check it out, please let me know what you think: ph@prodigitalrecords.com.
Hope nobody is offended by this off-topic message. Might liven things up there in the tower a little tonight, Randy...
Anyway... now back to the regularly-scheduled material!
VanRip - I wouldn't say that the U.S. has ever really experienced HYPERinflation. Nor do I expect things to get that bad this time around. Still I suppose it depends on what is meant by "hyper".
Randy is right, however, about the effects of inflation being positive for some stocks while negative for others. But, for most stocks and for the averages (the Dow Jones Industrials, for example), high rates of inflation are destructive.
During the 1970s, the best period for which we have an example, the incentive to invest in securities was lost on just about anyone who was aware of the fabulous returns achieveable by investing in leveraged real estate or other tangibles. Furthermore, high inflation produced high interest rates, which complicate matters for businesses of all kinds.
**********
Meanwhile, the latest money supply numbers came out today. M-3 was up another $15.3 billion! We are watching history in the making, folks! That is now 177 billion new dollars created in only seven weeks. Mama Mia! Multo Inflazzione!
I've always thought it would interesting to hook up a voice analyzer to WJC's pronouncements and see if there is any pause whatsoever in the endless mendacity. Or is he so good at it that nothing would register?
Some excerpts from Morgan Stanley's Preview of the Year 2001
> In their forecast for 2001, Morgan Stanley economists Joaquim Fels and
> Stephen Li-Jen expressed their concerns about the dollar as follows:
>
> "...we believe the next three to six months are likely to be characterized
> by downside surprises in global trade and GDP growth, accompanied by a
> difficult equity (stock) market and M&A (mergers and acquisitions)
> environment. With the U.S economy and markets at the core of these
> developments, we expect the U.S. Dollar to weaken in 2001..."
>
> Meanwhile, Morgan Stanley's metals and mining analysts sum up gold's prospects as
> follows:
> "Gold may be a safe haven during a hard landing. Gold was one of the
> best-performing asset classes in two of the last three recessions. IN 1974,
> the price rallied by some 75%to $175 per ounce as the oil shock unfolded.
> In 1980, it rallied by 110%to over $640 per ounce as the oil crisis again
> took hold. Gold is historically viewed as a hedge during political
> uncertainty, rising inflation or severe deflation."
To FOA. . .A challenging question from the C-Man. . . .
FOA: "The fed must create an inflation on top of an inflation. To not do so, they will immediately concede the currency world to the 'old world's' new currency and it's physical friend. Gold! Even most Euro doubters are beginning to see this new light. . ."
Including me. I saw in the Economist the other day that Goldman Sachs is calling for a euro price this year of $1.22! Bold and telling. . . This is a currency price based on "an inflation on top of an inflation". . . .Yes?
Cavan Man called today. And as is frequently the case the conversation got around to you and Another, the economy, currency values, etc. It is always good to hear from this fellow knight and traveller, and in the midst of the conversation he asked, as I have come to learn is his customary fashion: "Why doesn't Greenspan do something about this. He must see what's coming." I tried to answer that question, but I wonder how you would respond. Here (Greenspan) is a man who spent his middle years as one of us. Then he became Fed chairman charged with the responsibilities of lender of last resort and something changed. . .Or did it? I answered the question as best I could but it is one that does not lend itself to an easy answer. And perhaps only Alan Greenspan himself could answer it to real satisfaction. I venture a guess that he might respond smiling slyly with "I didn't know there was a problem." (Thought of that after I hung up the phone, Cavan Man.)
FOA, I wonder if you, or perhaps Another, have any thoughts on this. I think the question might open the door to some interesting discussion. If anyone else would like to take a stab at it, I think we might all gain by your thoughts. And I hope I am not usurping prime posting privileges, C-Man. It is a good question and I didn't want to take the chance that you might pass on a great Forum opportunity. (I hope you don't mind.) Now you've stimulated us all.
P.S.(and an aside) An editorialist asked this morning: "What do you get when you cross the Chairman of the Fed and the Godfather." Answer: An offer you can't understand.
I haven't seen this on the forum today. Towards the end of the article it states that the BIS central bank masters hold 80% of all the gold reserves.
French firm takes BIS buyout battle to court
By Brian Love
PARIS, Jan 18 (Reuters) - A French firm contesting the terms of a compulsory buyout of private shareholders in the Bank for International Settlements said on Thursday it had started court action against BIS advisers J.P. Morgan and Arthur Andersen.
Deminor, a corporate governance consultancy company, said it was taking U.S. investment bank J.P. Morgan and the audit firm Arthur Andersen to court in Paris in a bid to get the terms of the controversial buyback reassessed independently.
The firm, which represents a portion of an estimated 15,000 private holders of BIS shares, wants the offer price raised and and has warned it will take wider legal action if necessary.
"We made our decision on the basis that there were numerous irregularities and contradictions in the report drawn up by J.P. Morgan on the evaluation of the price for the withdrawal of BIS shares," Deminor said in a statement on the Paris court move.
"The plaintiffs also argue J.P. Morgan lacked independence vis-a-vis the BIS and, more importantly, vis-a-vis the central banks that are the BIS's majority shareholders and the ultimate beneficiaries of the share buyback," it said.
The Swiss-based BIS -- founded in 1930 to handle German war reparations -- has got into a bind since it hatched plans to buy out private investors who hold 13.73 percent of its capital alongside the main BIS shareholders, central banks across the world.
LEGAL TUSSLE ESCALATES
Despite legal actions or threats of litigation on both sides of the Atlantic, the BIS's central bank shareholders endorsed the buyout plan on January 8, backing an offer price of 16,000 Swiss francs -- which is based on an evaluation by J.P. Morgan that was reviewed and approved by Arthur Andersen.
The BIS, the main coordinating body for the world's central banks, declined comment on Deminor's latest move.
It has said in the past that the price is fair and that it was conducting the buyback because having private shareholders is no longer compatible with its role in the surveillance of bank standards and financial markets across the globe.
J.P. Morgan's French division, which conducted the disputed evaluation, was not immediately available for comment.
"We believe the price proposed for the withdrawal was fair," said Arthur Andersen France spokeswoman Sabine Roux de Bezieux.
Deminor's Fabrice Remon, whose firm is heading several other high-profile campaigns on the rights of minority shareholders, said he hoped the Paris court, the Tribunal de Grande Instance, would order an independent price assessment in a few weeks.
"What we want is a genuine evaluation," Remon said. "We are not trying to block the transaction but we are trying to secure more money retrospectively," he told Reuters.
Remon also said that J.P. Morgan, which recently merged with Chase Manhattan Corp to form J.P. Morgan Chase & Co , was a dominant force in the world gold market.
This, he said, made it even more important to seek another estimate on the BIS share price, given that the BIS's central bank masters held 80 percent of the world's gold reserves.
"We're not making any judgment on this," Remon said. "(But) they could perhaps have easily found a bank where there was no question at all of a potential conflict of interest."
Deminor has been waging the battle in Europe, but the BIS is also under attack in the United States over the buyout of the shares which were recently delisted in Paris and Zurich.
On a separate count, U.S. gold trader Reginald Howe has filed a suit alleging that the BIS colluded with other central banks to depress the world gold price. Howe, who is himself a private BIS shareholder, has also complained about the buyback.
SocGen First Eagle Fund has also filed a complaint.
inflation (68-82)isn't good for stocks, nor excessive deflation. corporations (well... everybody)thrive when debtors can pay and creditors can collect. inf/de flation skews this relationship.
In the Jesse Jackson story, there are some disturbing points that I hope all have noticed. The principles I observed in Jackson's political tactics are striking. The following from the Drudge Report:
Jackson urged Clinton to take a contrite tone in his public explanation of the Lewinsky affair:
"Keep your eyes open and your mouth shut. And don't panic."
"If you respond with a contrite heart," Jackson told Clinton, "that obligates the public to respond with mercy."
me again: Note what needs to be read here and observed.Jackson understands that we are and can be MADE to feel obligated. This from a man who upon his transgression being exposed sees fit to retire, temporarily at least. But while he knew of his transgression "advised" his President on what to do in order to retain power. You see, to Mr Jackson, Mr Clinton was "his" president. Small "p" intended. And the "right" and "what is right" is not going to tamper with the power and privilege that comes to a person like Mr Jackson who knows he owns a president. And he will do and say ANYTHING to protect his fiefdom. He and his type KNOW that if the truth ever makes inroads, on those who foster deciet, then their days are numbered. Follow me on this. You have become the leader of a movement of so called justice and morality, you have an ally in the president, all seems well. Power to the undisciplined needs to be fed. To satisfy your sexual or ego needs you let the "so called admiration of a follower/supporter into an area designated for your wife. You "handle" the situation that develops. Your president gets into a similar situation. You have covered your tracks, so make quick and help him. Again look at these words above. "Keep your eyes open......" me: he says to Clinton look around....scan the political scenery.....latch onto those that will forgive easily..ingratiate yourself to them, flatter them and absorb them while they puff up with their prominence, this lessens your opposition afterall how can they dispute Godly men? .... his words again"keep your mouth shut...." me: you can't say anything here, wait for the opposition to make its move, someone on the right will overreact, focus on their mistake, let us, your allies, jump on them and tie ALL opposition to your behavior to these that have overreacted. Label them the FAR right etc.
Him again..."If you respond with a contrite heart, that obligates the public to respond with mercy"...me: WOW! Powerpacked in its corruptness. We can manipulate the publics emotions. Instead of healing wounds and working on letting sorrow purify the soul, we get a political operative whose mode is full gear to operate on the publics psyche. We have a man who is determined to keep in power the man who helps him keep his own power. All the while choosing to ignore his own responsibilities in life. This reminds me of something I read today by Emmanuel McLittle. He said "Some of us have gone through our entire lives believing that not seeing is a protection of sorts" Wow! Here, Jackson had had many moments of truth to own up to his own failings, as each of us must do and he denied the truth. Worse when he was put, in my opinion by Divine Providence, in the position of using his own experience to his advantage and correct not only his own actions but that of his puppet president, he denied the Truth again. Mr Jackson had the opportunity but like many of us have in our own lives, chose to deny the truth for personal ego salvation. Think of this. He had to consciously utter the words of strategy, all the while knowing that he was lying to protect, all the while knowing that the public, you and me could be made to conjure up our forgiveness, because so many of us do not wish to be unforgiving.
Now why write this little piece here? Simple. We are afficionados of good money. We calculate all manner of means to understand why gold is not valued higher, when it will go higher etc. Waste of time. Total waste of time. True value of sound money is not a supply and demand issue it is and always has been an honesty issue. Don't kid yourself. That is a distraction. Afficonados of good money need only to understand the human ego. The ego wished in the garden, if we are to believe the story, to be what God had not intended. Mr Jackson and Mr Clinton can go to church all they wish, but if their ego is where Adam's was, truth will depart. If collectively,the citizens of this or any other country admire or bond to, or choose to be ego's of their own we will never have honest money, politicians, or any other worthwhile thing. Bank on it. When you watch Crossfire, Politically Incorrect, Geraldo, the Nightly News among others you are watching the battle for your mind, your soul and in the end what is Good and not good. Some will go to no end to convince you that what you see isn't really what you see. In fact, I remember a gentleman from the Clinton security team in Arkansas, saying that they had a joke amongst themselves. Whenever Clinton would commit another of his discretions, they would look at each other and say "Lying eyes" and laugh. The thing they learned he said was that it was pointless to try to cover all that he would do. But they found that the average person only had to be approached and asked this question. "what are you going to believe, me or your lying eyes?" Simple and if a bit of force had to be added so be it. Most people will buckle fairly easily.
The reason we never get anywhere on this gold front is simple. Most are too hard at work to follow the bouncing ball on money, real money. And if properly managed the whole inflation money printing scheme is one of the most profitable and easily hidden of all lies. The printers are smart like Jackson. They keep their eyes open. They keep their mouths shut.
We need to keep our eyes open and we need to choose our words carefully so as not to be marginalized by the press. We need to sit quietly with our families and friends and multiply our disciples. It is the only way to gain our freedom from despots back. If Bush cannot stand for something in his presidency and one more term of a weak, Nero like leader such as Clinton takes office, we will have passed our time in history as a Republic. You will likely be happy you have gold, but any strong force will easily take it if we are absent of a civilization that respects private property. So are you ready to protect what you still have?
Hello Golden Leader! We have rounded "The Curve" and now I find myself in The Twilight Zone of clarity, in regards to this post. Maybe I'm missing something, but this time I don't seem to be missing anything from this read. What gives? There are only a few possibilities: 1. You got tired of communicating in Alan Greenspandex-speak {smiling back at ya}. We ARE getting late and it's time for all to get aboard. 2. Maybe I just had a couple lucid moments. Critical mass cometh? 3. Transparency is now the norm. The ESF & Fed will have full disclosure as of next Monday, and FK will have open doors for audit/inspection. The total above-ground gold supply will soon be known as well as holders of same.
Anyway, thanks for the very concise message! May we all be considered FsOFOA! auspec {in the "zone"}
Thank you for your posting that informs that yet another firm of financial substance has filed against BIS.
It's amazing to me that REUTERS are somehow unable to get out the 4 worded label GATA,in their rather extended blurb. We do all recognize, do we not, that the HOWE/GATA suit is bankrolled by GATA and that GATA is supported primarily by 'the little guy'.
All I can say is that when this baby blows, meaning the control of the gold cartel, there's going to be s**t in places we previously had thought to be virgin, sacred, and totally squeaky clean.
In the meantime, I like the company that GATA seems to be attracting.
Al Fulchino (01/18/01; 21:12:44MT - usagold.com msg#: 45880)
Hey Al, that's positively awesome!!!
It belongs in the Hall of Fame for sure. Consider this a nomination.
Re: "If Bush cannot stand for something in his presidency and one more term of a weak, Nero like leader such as Clinton takes office, we will have passed our time in history as a Republic."
I happened to catch today's interview on CNN and, being a non-TV-owner, this is the very first time I have seen him, live, rather than reading the printed word. This is my observation:
When people talk of Bush being a bit "slow" and perceiving him to be "not so bright" they are witnessing someone who is not programed for instant response. He is not a "Stepford" man. I see him actually thinking for himself about what he is being asked and formulating his personal answer. That slight delay is, in my opinion, the process of a basically honest man. This was not someone thinking of the "correct" answer. When asked about California's power problem, he straightforwardly said that we need to relax some environmental standards that are keeping some plants from being on line. This was not a politically correct statement to make in the midst of the Cabinet hearings.
I was especially encouraged by his viewpoint about drug use punishment. He said (paraphrased) that first time offenders should not be hit with these draconian sentences; that prison space had better uses; and that drug dependency should be seen and addressed as an "illness." Then he said, "This is why I advocate faith-based (methods)." Regardless of which faith one may agree or disagree with, faith is not punishment and faith is NOT psychiatry!
We may be at a major turning point in the downward spiral of our society. My family and I choose to believe this.
No, the US has never suffered 'hyperinflation' - at least not pre-world war 2 German style, but they hold the record for the inflation of 'hype' (from Hollywood, Wall Street and all the way to the White House).
What is interesting is that we may be on the verge of a major (read: high profits) bull market in bonds, of the kind that occurred here during the Great Depression, or in Japan in the 1990s. Now that does not indicate a bright future for the stock market.... four years of bear followed by a decade of economic stagnation.... but clearly we are on a deflationary track. The Federal Reserve has (until recently) been expanding the money supply at a 10%-plus rate, with little effect on the Consumer Price Index (even after adjusting for the government's fudging of the numbers); leading inflation indicators are turning down after having risen earlier in 2000; utilities are clearly in a bull market; junk bonds are sinking in value, even defaulting at historically high rates. In other words, the rate of asset deflation (exhibit A: the NASDAQ) greatly exceeds that of money creation, whether by the Federal Reserve (monetary base) or as multiplied by the banks or by Wall Street (derivatives, government-enterprise real estate loans). Because we have had such a long period of uncorrected excesses.... certainly since 1995, and one could make an argument for years (1989, 1987) extending back to 1982.... now that the bust is upon us, I would expect it to be of much greater magnitude than the last, fairly mild, recession in 1990
DJ Asia Precious Metals: Gold Up; Short Covering, JPY, AUD
http://www.thebulliondesk.com/DJNews/4053643.htmTOKYO (Dow Jones)--Asian spot gold was trading up late Friday on short covering encouraged by a stronger Japanese yen and Australian dollar, said traders.
The Australian dollar was trading around US$0.5615 late Friday, up from US$0.5560 late Thursday. The stronger yen, which was trading around Y119.05 to the U.S. dollar late Thursday, was up to Y117.35 late Friday.
(Prices in dollars/troy ounce, except Tocom in yen/gram.)
Friday Change On Thursday Friday Leading
0700 GMT New York Late HK Range Tocom
Gold 266.20 up 1.45 264.10 264.90-266.50 1001
Silver 4.81 up 0.01 4.70 4.78-4.83 18.07
Plat. 612.00 up 1.40 612.00 608.00-616.00 2,209
Pall.1,040.00 dn 15.00 1,020.00 1,020-1,060 3,550
Hong Kong spot gold opened at US$265.15 a troy ounce, up 40 cents from New York late Thursday.
Although trading volume was thin, gold may be making a sustainable recovery from its low of US$263.50 in Asia Thursday morning, market participants said.
"Unlike yesterday, selling interest has dried up and gold is looking pretty good," said a Sydney dealer.
Gains, however, should be limited before the Bank of England auction of 25 metric tons Tuesday, said traders. A Hong Kong dealer said the yellow metal will likely head up to US$267-US$268 before the auction.
In the medium term, however, the chance of a strong short covering rally remains, said the Sydney dealer. "The funds have some huge short positions between them."
The other precious metals were quiet and mainly up.
Spot silver made further gains overnight and is looking strong, said the Hong Kong dealer. "Recent gains (made by silver) made on short covering and the trade seem to be flowing onto gold. The picture looks nice and rosy today."
Of the PGMs, platinum was trading up from New York but equal to Asia late Thursday, and palladium was down from speculative New York highs.
Tokyo Commodity Exchange precious metals trade was mixed, with the stronger yen weighing heavily on prices, said a Tokyo dealer.
December gold closed down Y5 a gram from the previous Thursday close of Y1,006/gram, silver was up Y0.08/gram from Y17.99/gram, platinum was down Y39/gram from Y2,248/gram and palladium was up Y49/gram from Y3,501/gram.
-By Ian Kerr, Dow Jones Newswires; 813-5255-2935; Ian.Kerr@dowjones.com
AngloGold, Barrick, Gold Fields, Placer Dome in merger mayhem
http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B2422569D80065C537?OpenDocumentGold Fields Ltd gained five per cent on the Johannesburg Securities Exchange on Thursday (18 January) amid speculation a merger proposal from AngloGold was imminent. All companies involved have declined to comment, although Gold Fields managing director Ian Cockerill confessed to being flattered by the attention.
And if the Johannesburg rumour mill is to be believed, the attention is considerable indeed! For example, it has been suggested AngloGold will first enlist the financial clout of North American company Barrick Gold; only then can the two parties make Gold Fields an offer it can't refuse.
A variation on the theme is that Barrick will first merge with AngloGold, then take out Gold Fields. Another view is that Gold Fields will seek a merger with Placer Dome as a defensive measure. But not so fast with your broker's number: wasn't Barrick eyeing Placer itself; and what about the prospect of Newmont taking out Placer now that it had fully absorbed Battle Mountain? Oh dear, somebody must know, mustn't they?
Dave Meger, an analyst for Alaron Trading in the US comments: "It gets out there and everyone's talking about it, and you don't know if you're making a bad rumour or a worse one," he says of Anglo's plot to gobble Gold Fields. This is the environment in which hasty investors get burned: buying on rumour and all that.
The fact of the matter is that the fundamentals of Gold Fields's business suggest the counter remains a decent buy, even at R27.30 a share. A recent broker's report states that on the whole Gold Fields' core operations have continued to improve in the three months to December. Management is well directed and, of course, there is a strong possibility of corporate activity. AngloGold and Anglo American own about 17% of the company and could marshall shares from friends and allies to buy more.
There's little doubt AngloGold is hot for Gold Fields, but the exact details and timing of any approach are unknown. What is known is that AngloGold's new chairman, Bobby Godsell, prefers friendly mergers. Hostile takeovers attract very large premiums and AngloGold would struggle to justify exacting its balance sheet more than is necessary.
It's also suggestive that Godsell has taken on the chairmanship of AngloGold, almost as if he were clearing a space for his old colleague, Ian Cockerill, to park his executive toys and undoubted operational acumen. But there I go again, speculating. I say announce the deal and then we'll have something to write about. Wise investors will also stay calm.
Incidentally, the JSE's All Gold Index improved its value by two per cent on a day in which the gold price picked its head up again; so Gold Fields's peer group also benefited. AngloGold was up R1.00 (R218.00 a share); Harmony increased R0.90 cents (R36.50) and Durban Roodepoort Deep gained 30 cents (R5.80) on a decent set of December quarter results.
>It seems to be the commonly offered advice to "get out of debt." However, if someone is anticipating hyperinflation, what is the logic? As per mhchuck (01/18/01; 13:39:29MT - usagold.com msg#: 45858), you can emulate 1922 German businesses and go into debt, knowing you'll be able to pay back that borrowed money with inflated money.
Anyone know where the idea of paying-off your debts under such economic conditions came from? Is it just banking disinformation, wrong-headed cultural blather - - - or is there some logic to it that escapes me?<
Black Blade: Maybe you got a point there. However, I will leave this life owing no one. In a Hyperinflationary environment, I would hope that my extremely "Precious" metals would carry me through. After all, that is the insurance policy of having PMs in my portfolio. The Germans (Ants?)who had gold during the 1920's did not suffer quite so much as their many of their countrymen (Grasshoppers). The result was devastating enough as Adolf Hitler and friends emerged to bring another horror to the world. Then of course, certain peoples of certain racial and ethnic background who had gold, silver, diamonds, etc. were able to flee the terror with a bit more ease, whereas their fellow countrymen of similar background fared rather poorly. To paraphrase a common cheese commercial in the US, "Ah, the power of Gold!"
WASHINGTON (Reuters) - President-elect George W. Bush on Thursday vowed to fight a ``huge energy crisis'' by analyzing all federal lands for oil exploration, enlisting Mexico's help and rejecting calls to breach hydroelectric dams. In an interview with Reuters, Bush expanded on his previous calls to reduce U.S. dependence on foreign oil by increasing domestic production, and said a natural gas pipeline would be needed to transport any gas tapped in Alaska's Arctic National Wildlife Refuge (ANWR). ``I can't (over)emphasize how important it is for this nation to develop energy supplies. There needs to be conservation, no question about it, but we cannot conserve our way to low prices and energy independence,'' Bush said. Bush said he would respect state wishes not to allow drilling for oil off the coasts of California and Florida. But he said there were a lot of ``western lands'' that could support energy exploration without undue risk to the environment. ``I'm going to analyze every ... every piece of property that is federal land and come up with a cost-benefit analysis, basically. Because we need more supply,'' he said. He said there would be ``pristine'' and ``sensitive'' areas where energy development should be prohibited. But referring to the Arctic refuge, he said, ``No question about the fact that the ANWR will be a part of a longer-term strategy.'' Environmentalists hotly oppose oil and natural gas drilling in the vast federally protected wildlife area. Congressional action would be required to open the area to energy development. Developing the refuge would not have a quick impact, because of the need to build infrastructure, Bush said. ``Natural gas can't be trucked. It's got to be piped and therefore there has to be a pipeline, capacity to move that gas,'' he said.
Bush Dismisses Calls For Breaching Dams
Bush dismissed as outdated calls for breaching hydroelectric dams that have been criticized by environmentalists for disrupting salmon runs, especially in the Pacific Northwest. ``I don't notice anybody talking anymore about breaching the dams to save the salmon now that there's a huge energy crisis,'' he said. He added that the calls to breach dams arose ``when it appeared we had an abundance of cheap energy. Bush said power from hydroelectric dams was needed. ``When you start removing supplies of energy out of the mix, you're going to affect price.'' Bush said strengthening energy ties with Mexico, which is the world's fifth-largest oil producer and not a member of the OPEC cartel, would have the most immediate impact to ease a U.S. energy shortfall. ``The quickest way to have impact on the energy situation, is for us to work with Mexico, and a certain extent Canada, to build a policy for the hemisphere,'' he said. California, now in the throes of an electricity supply shortfall, faces long-term difficulties in a lack of electricity production capacity and a lack of pipelines to deliver energy supplies, he said. The United States would make clear to OPEC, the Organization of Petroleum Exporting Countries, that any moves to raise oil prices would put the economies of the United States and other free-market countries at risk, he said. This has also been a central element of Clinton administration OPEC diplomacy, but OPEC on Wednesday agreed to cut production by five percent to keep crude prices at $25 per barrel.
Black Blade: Easier said than done. The Enviro lobby in DC is well connected and bribes�er, contributes to many campaigns. BTW, I also saw the FOX interview with GW. It appears that he more or less said to Kalifornia � "You're on your own." Why not? Bubba punished the western states for not voting for him by confiscating the land for the Gubbermint. I see no problem with a bit of "Tit for Tat." What goes around � comes around. Besides, the Grasshoppers got themselves in this mess knowing full well that this day was coming. GW only suggested that Hydro-Carbon Man undergo a little withdrawal from his addiction. It was only a matter of time. "�. And the Grasshoppers danced, played, and sang all summer."
By KPIX - BCN
Pacific Gas and Electric Co. said today that it could run out of natural gas within the next month now that six wholesalers plan to stop selling it to them on Jan. 23. PG&E Chief Executive Officer Gordon R. Smith said, "As California continues to struggle with an energy crisis and the financial havoc it has created for the state's utilities, we face the very real possibility of natural gas shortages in the coming weeks." Smith said the six wholesalers that won't sell gas to PG&E account for 36 percent of its daily supply. Another group that accounts for an additional 30 percent is threatening to follow suit. He said the company is quickly depleting its current supply and will run out by early February if no action is taken. PG&E has only been able to purchase approximately 60 percent of the gas its customers will need for each day in February. The gas suppliers, PG&E says, have significantly changed the method of payment they will accept. PG&E said it is unable to pay in advance or on delivery for gas because it has exhausted its cash and credit due to high wholesale electricity prices. PG&E said it asked Gov. Gray Davis on Jan. 9 to use his emergency powers help the situation by providing short-term financial assistance so the gas suppliers will continue to sell them gas. It also asked President Clinton on Jan. 12 to declare a natural gas state of emergency.
The California Public Utilities Commission has instructed PG&E to divert gas from some of its noncore consumers, such as large industrial customers, in the event of a shortage. PG&E said this will only worsen the already bad electricity situation in California, because some of those industrial companies are power generators that require natural gas to produce electricity.
Black Blade: This has got to show up in the economy sooner or later. Meanwhile, some say that bankruptcy is inevitable at this point and that no outside NG supplier would be so stupid as to "give away" NG knowing that the troubled Utes simply cannot pay for it. Besides, PG&E and Edison have gone into technical default. � in other words � "Game Over."
I'm trying to track down some data on silver demand. A couple of sources earlier today informed me that silver demand has kicked into high gear, not so much from the photography sector, though there has been quite a bit of an upturn in the investment sector, there appears to be a huge pull on silver demand for "High conductivity" wire. Apparently, some of the fallout from the current energy crisis has put a huge demand on silver by power suppliers that are upgrading their infrastructure. As companies are looking to maximize efficiency, attention has turned to such materials as silver because of the benefits of integrating silver into wire production. None other than Stephen Leeb, editor of "Personal Finance", a financial newsletter has also mentioned this. He also mentioned that there is a "shortage" in silver - Hmmm...
As I have said, I will have to track down a couple more people as well as these "friends" that have emailed me. All that I can say now is that they are in the industry, so I have no reason to doubt them. If anyone has any info on this please post any info you have on it. Maybe that is much of the reason for the nice 7% move in silver recently � who knows?
http://dailynews.yahoo.com/h/ap/20010118/us/power_woes_93.html By JOHN HOWARD, Associated Press Writer
SACRAMENTO, Calif. (AP) - California cut off power to thousands of people for a second straight day Thursday as lawmakers rushed to enact emergency legislation to buy electricity at taxpayer expense and keep the lights on.
Californians stocked up on flashlights, generators and firewood as the northern half of the state was struck by rolling blackouts. The outages were expected to affect one million customers at a time for at least an hour. The blackout order could be expanded to the south, said Stephanie McCorkle, a spokeswoman for the Independent System Operator, keeper of the state's power grid. ``It really feels like deja vu today,'' McCorkle said. ``We are living hour by hour here.'' The blackouts, which came two hours earlier than those on Wednesday and affected twice as many people, were prompted by the loss of about 1,000 megawatts from Oregon's Bonneville Power Administration. One megawatt is enough to power 1,000 homes.
There had been signs it was going to be another bad day. The ISO declared a Stage 3 alert just one minute after midnight as power reserves dipped toward 1.5 percent. The ISO ordered the first blackouts in the state's months-long energy crisis on Wednesday. Hundreds of thousands of northern and central California residents saw everything from their lights to their heaters, computers, elevators and bank machines abruptly switched off as power reserves dropped below 1 percent. Power was shut off to as many as a half-million customers at a time, affecting homes and businesses in San Francisco, Silicon Valley, Sacramento, Modesto and others cities.
Gov. Gray Davis declared a state of emergency and ordered the state to temporarily start buying power from wholesalers and provide it to power-short and financially strapped utilities. The Legislature was expected to pass the bailout plan Thursday. An unstable market, deregulation, the Pacific Northwest's limited supplies of hydroelectric power and the utilities' financial problems are all contributing to the crisis.
The two largest utilities, Pacific Gas & Electric Co. and Southern California Edison, have both defaulted on millions in dollars in bills and lender payments. Adding to potential problems, PG&E officials say they may have to cut off natural gas supplies to customers that include electricity plants, the San Jose Mercury News reported Thursday.
The move could come within days because gas suppliers are threatening to stop dealing with the cash-starved utility out of fear of not being paid, PG&E President Gordon Smith said. Davis' emergency order allows the state Department of Water Resources to buy power, something he called a ``bridge to a long-term solution.'' He did not mention making utilities pay for the power, which could cost taxpayers tens of millions of dollars over the next few days. Davis called on the Legislature to authorize a longer-term plan to buy power and provide it to utilities. Otherwise, power suppliers may call in their debts on PG&E and SoCal Edison, forcing them into bankruptcy.
On Wednesday, state regulators came within 1,300 megawatts - enough electricity to power 1.3 million homes - of ordering the first statewide blackouts since World War II. Automated teller machines along several blocks of downtown San Francisco shut down and at least two students were trapped in an elevator that stopped between floors at the city's Hastings School of Law. The students eventually used a ladder to climb out. Power was kept on at such essential facilities as hospitals and airports. In Washington on Thursday, Energy Secretary designate Spencer Abraham said President-elect Bush viewed California's power crisis as ``an urgent priority'' but it was too early to speculate on any federal government action.
Black Blade: Thumbs up to all who prepared for Y2K. Who looks stupid now? Can never be "too prepared." For proof � reread the first paragraph. The Ants are "snug as bugs in a rug", while the freezing Grasshoppers can reminisce about how they "�Danced, sang, and played all summer." Now about having gold as insurance�.
I've updated the first two links on that HomePage, labeled:
Metals Market Charts
-and-
Latest Market Charts.
Klik on either one, then it's easy to toggle to the opposite one
by kliking on the square logo at the right side of the charts.
Or, you can simply bookmark either of these to go directly to:
http://users.sisna.com/ThaiRanch/EagleRanch/mkt-chrt.htm
-or-
http://users.sisna.com/ThaiRanch/EagleRanch/mkt-chr2.htm
DJ S. Africa's Gold Fields Up 9.0% On AngloGold Bid Talk
http://www.thebulliondesk.com/DJNews/4054541.htmJOHANNESBURG (Dow Jones)--Shares in South Africa's Gold Field's Ltd. (GOLD) rallied 9.0% Friday amid speculation that AngoGold Ltd. (AU), the world's biggest producer, is poised to take over the country's number two producer.
"Gold Fields' Chris Thompson is just waiting for the call from AngloGold's Bobby Godsell to say how they're going to take them," according to a source close to Gold Fields.
Around 1000 GMT Gold Fields was ZAR1.70 higher ($1=ZAR7.9425), or 6.2%, at ZAR29.00, down from its 9.0% jump at ZAR29.75 earlier while AngloGold was ZAR5.40 higher, or 2.5%, at ZAR223.40.
Some watchers suggest bid talk is being circulated in the market by Gold Fields in an attempt to boost its share price ahead of a possible move by AngloGold.
"Whether the rumors are true or not, you can't discount it as a move by AngloGold for Gold Fields is imminent," said an analyst at a local securities house.
Speculation that Anglo American PLC. (AAUK), AngloGold's parent company, could make a move for Gold Fields has been mounting since mid-December.
Anglo American upped its stake in Gold Fields to just over 17% after a share swap with South Africa's Remgro Ltd. (O.REM), and that deal made Anglo American the biggest shareholder in Gold Fields.
Its 17% stake in Gold Fields now sits along side its 17% stake in Western Areas Ltd. (O.WAR), 17% in Avgold Ltd. (AVGLY), and a 54% holding in AngloGold.
Local talk centers on Canada's Barrick Gold Corp. (ABX) joining forces with AngloGold to take over the country's number two producer.
Market watchers, however, ruled out a straight tie up between Barrick and AngloGold due to logistical differences between the two companies. They say the odds are - should a deal emerge - that Barrick will play a secondary role and that AngloGold will strike for Gold Fields on its own.
"Everybody knows Barrick are in town, and they're desperate to get some ounces in their portfolio," said an analyst at an international securities house.
Barrick is seen as overpriced with a price-to-earnings ratio of 19.00, while AngloGold is seen as undervalued at 12.00. This casts doubt on a straight tie up between Barrick and AngloGold as Barrick's shareholders are unlikely to approve a sale that would lead to a down rating of the company's stock.
"Will Barrick's shareholders be happy to have their stock down rated? If anything AngloGold will just go for Gold Fields' on its own," said an analyst at an international securities house.
On an operational level, however, Barrick has expressed an interest in South Africa's Western Areas South Deep mine, where Anglo American holds a 17% stake. Barrick is said to have completed a number of studies on the mine, and with the possible sale of AngloGold's stake in Western Areas the money could help finance the takeover of Gold Fields, say analysts.
JCI Gold Ltd. holds some 40% of Western Areas Ltd., with Canada's Placer Dome owning 50%. However, Placer Dome has a preemptive right to match any offers for the remaining half stake.
Even so, there are potential synergies to be had between Western Areas and Gold Fields' 1.4 million ounces per year Kloof operation. More importantly, this could pave the way for AngloGold to take Gold Fields' 1.4 million ounces per year Driefontein mine, and with Gold Fields broken up the risk of antitrust issues being raised by the South African Finance Ministry is also reduced.
Both Barrick and AngloGold declined to comment on the speculation.
Gold Fields has been a potential target since its proposed $3.7 billion merger with Canada's Franco-Nevada Mining Corp. (T.FN) was dashed by the finance ministry in August. However, the merger is said to be back at the ministry for another reading and the company is hoping the deal can be resurrected.
SilverBugs have been harping about the horrendous shortage
of physical Silver for months. Weeks. Days. I could see that
something was in the wind a few weeks ago.
FYI: HECLA (HL/nyse) is a producing Gold & Silver miner.
One of my favorites. Three weeks ago, you could've bot shares
of it at 50-cents. Yesterday, it was trading over a Buck. Had
people listened, they could've doubled their (paper) money in
that time. Like I did. It's a $5 stock in good times. A steal at
these current all-time-low levels. IMHO.
One of my friends works as a buyer(a former mining engineer) for a copper products operation (owned by a miner). He said that some clients were "looking hard" at "high conductivity" silver wire and possible alloy wires. He didn't elaborate, but said that several locked in copper and silver prices as if they knew something was up. I hope to hear from them this weekend, but maybe that's all they know. Certainly something is brewing in the underlying metals markets (base metals and precious metals). Who knows, maybe now that Captain Bubba is leaving the ship (kicking and screaming from what I saw last night - how embarrassing for the US), the old team that was putting a cap on metals prices just may give it a rest. The old boss is slinking outta the door.
Yes. Silver and Copper are the prefered Electrical conductors.
Silver far exceeds copper in conductivity, and is used for only
the most demanding and high-efficiency devices. Such as the
newest generation of generators. And alternators. Both will be
in high demand as the energy/electricity shortage causes an
increased demand for new generation facilities.
Oddly, this morning, Copper is down in price. (see above link).
Yet silver is soaring, (same link).
I attribute this to the fact that copper mines often have silver
as their byproduct. So, if copper miners ramp up their output
(of both) to capture more profits from silver, it will at the same
time flood the market with excess copper. Supply/demand.
Copper prices should fall. Silver's too, except that silver
is in great shortage. Whereas copper, typically, isn't.
When California deregulated, they ended up with more regulations than before
deregulation. California imports 20% of it's electricity. -Adrian Moore,
Reason Public Policy Institute, CNBC, Jan. 18, 2001, ~3:56PM EST
I see your point, and Journeyman's also, one can not forsee the future, but with so much money created in such a short time of seven weeks, is not the future quickly becoming the present. Anyway, my original idea was to max out my credit cards by purchasing the only thing I can think of that would guarantee me being able to retire that debt once the inflation set in- Gold coins.
Their increase in value in the hyperinflation scenario should allow me to pay off the debt with fractional amounts of the total purchased. Just like the agglomerators, you borrow the money, use it to build up your assets(them, plants - us, Gold) and with the inflated profits caused by extra generating capacity(them, because of their expanded manufacturing ability- us because of our expanded physical amount of assets) coupled with the hyperinflation, the debts are retired with ease, and profit is realized in a greater amount because of the use of OPM.
In this theoretical-historical scenario, one might be able to secure many ounces of physical through the means of credit and ultimately pay for them with a fraction of an ounce of that first acquired by this means.
Would this not solve the question of reliable future income to pay off the debt posed by Randy of the Tower? As long as one had enough reliable income to pay the bare minimum charge on the credit cards, until the hyperinflation (and Gold runup) scenario was fully upon him/her. And what if the hyperinflation scenario does not emerge? The person engaged in this leveraged deal would still have at hand the physical gold, and thereby the means to retire the debt with the same instrument that created the debt(if he/she wished), in addition to the income from his/her regular profession, which I would assume would still be in existence due to the absence of hyperinflation, and its effects.
Why not use the same game that they created against them?
What is wrong with my scenario Randy? Journeyman? Anyone?
Might this be the creation of the first reverse derivative, the opposite of what the BIS and the CBs' do-changing credit into Gold?
"In a Hyperinflationary environment, I would hope that my extremely "Precious" metals would carry me
through. After all, that is the insurance policy of having PMs in my portfolio. The Germans
(Ants?)who had gold during the 1920's did not suffer quite so much as their many of their
countrymen (Grasshoppers). The result was devastating enough as Adolf Hitler and friends emerged
to bring another horror to the world. Then of course, certain peoples of certain racial and ethnic
background who had gold, silver, diamonds, etc. were able to flee the terror with a bit more ease,
whereas their fellow countrymen of similar background fared rather poorly. To paraphrase a
common cheese commercial in the US, 'Ah, the power of Gold!'" -Black Blade msg#: 45888
http"//www.kitco.com/market/LFrate.html Are up again today. Fairly substantial increse especially in silver. The word on silver's four day rally is that it is/has been a "technical bounce". This may be true but this is also the standard response when the analyst or trader asked has absolutely no idea what's happening. It's like answering a child's question of Why with the answer Because. There was no large speculative short position to be covered before this move, there was a short commercial one (commercials are the producers and users of product). For whatever reason, if this continues, it may attract the fairly oblivious fund traders (speculative money) and then, if POS really advances, the thoughtless or totally oblivious momentum players.
If that happens gold goes too and I'll be busy promoting with an IPO a new Silver and Gold. com company. I'll need office staff and am taking applications. Pay is outrageously disproportionate with work involved and everyone recieves a new Mercedes and, of course, stock options. Our first corporate meeting will be to decide what if anything Silver and Gold.com does.
Watch the rates, they may be telling us something that the news hasn't figured out yet. When Warren Buffet bought silver in the summer and fall of 1997, he accumulated 89 million ounces before a lawsuit forced him to reveal his buying. He bought for months before discovered. He bought 129 million in total and shipped them to London. He may or may not still hold them. Maybe he or someone else wants more. Or maybe it's just a "technical bounce".
Rich
Those charts are a gas. - Truly informative when seen together, especially when you toggle back and forth. And, yes, they are quite addictive. Many thanks. Is this your site? Fascinating.
Hi Rich Powell:
Expect to see some "profit taking" (in Silver) today, as is
typical after a two-day runup. Also, it's a Friday/weekend,
and traders generally reverse their positions or close them
out pending the weekend break and uncertainty of that.
Also, that's good excuse-talk for clutz's like me who really
have no clue what's happening in those markets.
And as much as all indicators point to inflation,tomorrow the Fed might change it's mind and pull the plug.That is only one reason why this private and arbitrary system of money creation is so unfair.
Well said'sir.My friends and family often wonder why it is that I get so passionate and "worked up" about the US(and by extension of co-dependence;global)monetary system.Those two sentences neatly encapsulate the main reason.If I may be so impertinent to add to this;somewhat cynically,of course:
And as much as all indicators point to inflation,tomorrow the Fed might change it's mind and after fully informing business associates,influential long standing family dynasties,non-arms length government officials and others in the select circle;pull the plug.That is only one reason why this private and arbitrary system of money creation is so unfair.
Oh my, now relegated to a lowly lurker who must flit in briefly and out again like a moth that is singed with a flame. Life is so busy for me right now.....So why am I meandering around this thingy....
Sir Black Blade: trot yourself over to Gold Eagle and search out Ted Butler. Easy, yes?
Does anyone else remember the 1995 {approx} rumor that claimed our prez had some form of blind trust that was investing in gold resource stocks? Very costly rumor to lots of folks, wonder from whence it came?
It is extremely disheartening to hear of Barrick and Anglogold,the two evil stepsisters of the gold industry hovering over Gold Fields.The South African government may rue the day they nixed fellow non-hedger Franco Nevada's merger proposal over what seemed at the time to be somewhat minor concerns.
Send it on to the Grasshoppers who are feeling so abused and sorry for themselves.
Next time you are washing your hands and complain because the water temperature isn't just how you like it, think about how things used to be.......
Here are some facts from the 1500s.
Most people got married in June because they took their yearly bath in May and were still smelling pretty good by June. However, they were starting to smell, so brides carried a bouquet of flowers to hide the body odor.
Baths consisted of a big tub filled with hot water. The man of the house had the privilege of the nice clean water, then all the other sons and men, then the women and finally the children. Last of all the babies. By then the water was so dirty you could actually lose someone in it, hence
the saying, "Don't throw the baby out with the bath water."
Houses had thatched roofs-thick straw, piled high, with no wood underneath. It was the only place for animals to get warm, so all the pet dogs, cats and the small animals: mice, rats & bugs - lived in the roof. When it rained it became slippery and sometimes the animals would slip and fall off the roof, hence the saying, "It's raining cats and dogs."
There was nothing to stop things from falling into the house. This posed a real problem in the bedroom where bugs and other droppings could really mess up your nice clean bed. Hence, a bed with big posts and a sheet hung over the top afforded some protection. That is how canopy beds came into existence.
The floor was dirt. Only the wealthy had something other than dirt, hence the saying "dirt poor." The wealthy had slate floors that would get slippery in the winter when wet. So they spread thresh on the floor to help keep their footing. As the winter wore on they kept adding more thresh until when you opened the door it would all start slipping outside. A piece of wood was placed in the entryway, hence a "threshold." They cooked in the kitchen with a big kettle that always
hung over the fire. Every day they lit the fire and added things to the pot. They mostly ate vegetables and did not get much meat. They would eat the stew for dinner leaving leftovers in the pot to get cold overnight and then start over the next day. Sometimes the stew had food in it that had been in there for a quite a while, hence the rhyme, "peas porridge hot, peas porridge cold, peas porridge in the pot nine days old."
Sometimes they could obtain pork, which made them feel quite special. When visitors came over, they would hang up their bacon to show off. It was a sign of wealth and that a man "could bring home the bacon." They would cut off a little to share with guests and would all sit around and "chew the fat." Those with money had plates made of pewter. Food with a high acid content caused some of the lead to leach onto the food, causing lead poisoning and death. This happened most often with tomatoes, so for the next 400 years or so tomatoes were considered poisonous.
Most people did not have pewter plates, but had trenchers, a piece of wood, with the middle scooped out like a bowl. Trenchers were never washed and a lot of times worms got into the wood. After eating off wormy trenchers, one would get "trench mouth."
Bread was divided according to status. Workers got the burnt bottom of the loaf, the family got the middle, and guests got the top, or the "upper crust." Lead cups were used to drink ale or whiskey. The combination would sometimes knock them out for a couple of days. Someone walking along the road would take them for dead and prepare them for burial. They were laid out on the kitchen table for a couple of days and the family would gather around and eat and drink and wait and see if they would wake up, hence the custom of holding a "wake." England is old and small and they started running out of places to bury people. So, they would dig up coffins and would take their bones to a house and reuse the grave. When reopening these coffins, one out of 25 coffins were found to have scratch marks on the inside and they realized they had been burying people alive. So they thought they would tie a string on their wrist and lead it through the coffin and up through the ground and tie it to a bell. Someone would have to sit out in the graveyard all night (the "graveyard shift") to listen for the bell, thus, someone could be "saved by the bell," or was considered a "dead ringer."
Home Depot miss was another first, like MSFT. Smart money (read: clued in ahead of time) was getting out ahead of announcement. I talk to reloads and DC's on Windsor/Canadian border who say Canadian mills are scouring for lease space on US side. Their quota quarter ends 3/31 and seem to want to flood product over the border thereafter. With Canadian subsidies of their mills and pro-union stance they have no motive to cut production. Hence, like many other commodities near record lower prices. Canfor, the largest Canadian mill allegedly lost money 10 years in a row yet like Barrick they seem to not want to do anything about it. Could they also be a "hannibal cannibal" type participant? Today's WSJ had a story about upper end home pricing falling and bidders drying up. (Weekend Journal section,p-1) In a recession sub-prime goes first (it already has) then custom and upper end is next (in progress) and lastly the bread and butter mortgage similar to rent payments. We seem to be in stage 2 approaching stage 3. In my county my building inspector told me that last November he issued 20 new home building permits, in December only 2. In January so far he has issued 1. Does this sound soft in the landing?
Hear Ye. . . .Hear Ye. . . . A Call to Contest. . .
A test of your thinking, predicting and posting skills to occur from now until midnight (MST) on Tuesday, January 23rd. We stand at the first month of a new millennium, a time to stop and think what the future might bring. So the contest is simple as it is challenging:
To wit: Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion. We stand at a threshold -- not just of a new century but a time of uncertainty as the winds of change sweep through the world economy. There could be no better time for a contest with such a theme than now.
Your post must be at least 30 words and it must contain in the subject box the following:
**** 2001 -- A Gold Market Odyssey **** (Surrounded by stars.)
The prize will be a .1867 ounce pre-1933 French Rooster gold coin. There will be two runners-up who will receive a one ounce silver Eagle each.
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner will be the one whose arrow falls most closely to the mark. All price guesses must be accompanied by sound reasons for your prediction to gain the prize.
Also, all first-time posters will be awarded a one ounce silver Eagle if you post during the contest period -- from now until Tuesday midnight, January 23rd, 2001.
To qualify for the prize, you must e-mail jill@usagold.com confirmation citing the message number once you've made your first post. We will check each first-time poster's claim, so don't feel like you can get one by us.
We wish you good luck, good fortune. . . . . .And. . . . .
Thanks for the English expressions, always a treat. Our words have so much underlying meaning that is often overlooked. A couple come to mind that are applicable to our favorite markets: hanging by the skin of our teeth, intestinal fortitude or worth its weight in gold.
I always thought "trench mouth" came from the trenches of WW1 when very poor oral hygiene was practiced, resulting in this obnoxious infirmity. Question--- Are these "euphemisms" of which we speak?
My goodness, good man! First "free gold", now "free silver"! Does Gandalf know of this outrageousness? These must surely be boom times. My children {11 of em} don't get home from school until later this afternoon. Do they each have to make up a seperate essay? Maybe we can have a class project for each of them. Let's see 11 X 24 = 264 X $8.75 = $2,302. That ought to just about do it, do I have to pay shipping?
Let's take a look at the presently 'manufactured' situation with NG. Driven by 'altruistic aims' the free market was temporarily suppressed in order to buy off the idiots who waste time voting. Now the 'price'of silver is so low it's tempting companies to start to utilize the 'cheap' silver in thier products. And we are now witnesing what that does
(NG and Palladium). If the 2 largest utilities in the US and the banks who underwrote them and the 'genius'' who run bond funds could not model this scenario, guess what's going to happen to silver? The last time I looked Natural gas and palladium were NON-MONETARY METALS. Once companies start using high conductivity metals that are 'cheap' they CANNOT GO BACK.(quickly). The supply/demand imbalance of silver is far beter than NG and can only be rectified in a far more violent price environment and much longer time frame.
I've spent the morning adding alot more news and info links
to my HomePage, that may be of interest to Posters & Lurkers
and am wondering what's the url to your PONZI index.
If it's okay with you, I'll put a link to it there.
Also (RossL.) I can add a link to your special charts too
if you'd like. If so please post the url or email it to me.
PS: If ANYONE has a favorite link you'd like added there,
just let me know.
PPS: You will now find quick links to all the Gold Forums
right there in one handy mouse-klik spot.
What is wrong with my scenario @Christopher msg#: 45902
Hi Christopher!
I see you've moved much closer to the head of the class!!
"Anyway, my original idea was to max out my credit cards by
purchasing the only thing I can think of that would guarantee me
being able to retire that debt once the inflation set in- Gold
coins." -Christopher
Please don't make this move on my say-so! I would be most
uncomfortable living with the "karma." Please remember such
gambles are inescapably your own because you're the one who will
live with the results of your bets. I NEVER make major bets such
as the one you are contemplating without a LOT of study! Nor
without thoroughly considering and imagining living with the loss
of that bet!
There's nothing wrong with your gamble that you didn't point out
yourself:
"In this theoretical-historical scenario, one _might_ be able to
... pay for them with a fraction of an ounce of that first
acquired by this means." -Christopher
_Might_ is a very BIG word!
One problem with the credit-card version is you pay A LOT for
that money, which means you need a bigger edge to make such a bet
profitable in probablistic terms.
Then there is the sense here at USAGOLD that most of us seem to
be convinced that some sort of dollar melt-down is just around
the corner. But there are a lot of true believers here. I'm
one. So I'm at least slightly biased. Unfortunately for me, I
believe the system is functionally "evil" and so I find myself
constantly hoping for a "correction." This may be clouding my
judgement, though I painstakingly attempt to prevent that from
happening. Almost certainly most of the regular posters here
share this bias somewhat - - - so, you're not getting a balanced
opinion.
Some of my "balancing" friends consider a major dollar crash with
a major gold super-bull "un-thinkable." Greenspan doesn't
necessarily agree. None-the-less, some of my more sophisticated
"balancers" suggest the probability of such an event is somewhere
beyond the forth standard deviation.
On the other hand, it does seem lately that much main-stream
media (and reported events) seem to be in line with some of the
more radical scenarios we talk about here.
But then there's timing. As many posters here have pointed out,
gold is highly political. "They" don't dare let gold rise until
after the inflation hits (assuming they can prevent the price
from rising, and the processes by which they can, seem to exist
and be in play -- BOE Eddy George's comment in Howe's suit, etc.)
and no one can anticipate the psychology that will cause "them"
to break, let alone _when_ all this is going to happen (even
"they" don't know) - - IF it happens at all. You _could_ end-up
paying more than your profit in interest (or opportunity costs.)
All that said, to the extent you leave your assets, (past,
present or future) in dollars, you're gambling the dollar won't
depreciate significantly. Additionally, you absolutely know that
the dollar _will_ depreciate year after year, at the rate of
inflation - - - even if they spin it as "disinflation."
Have I left you confused and uncertain? I certainly hope so. My
"karma" considerations, remember!
Peter, that was a fantastic post on our language, thank you!
Christopher -- might make a difference if interest rate was fixed instead of variable, you know, Prime rate plus. Fixed would be sort of like a mortgage (or car loan), and you're holding the goods, just like a house. Don't know as I would go for a 125% mortgage, though, nor a variable rate one. It's all about sleeping well at night. Stress REDUCTION!
Interest rates are likely to do some nasty gyrations as credit markets implode.
And I guess it's also about an investment at its bottom price passing "from weak hands to strong hands." Credit money is "scared money" and characterizes speculation usually at the top of a bubble. In this case -- real asset and market bottom (?) -- that would be two plusses in comparison to the stock bubble, favoring using credit.
When FOA counsels getting out of debt, he's thinking of "strong hands" holding gold. Naturally, those of us still in the working years are looking for a jump on our retirement "portfolios", aren't we? We might be looking at it differently, with time as an asset to put up against taking greater risk.
Paper to physical, paper to physical. Somebody else's paper, yes, you've got to think more carefully. Understand your whole financial picture, and have a Plan B. If it's a good one..
You realize that FOA has not been talking the classic "asset allocation" model we've been hearing all these years, don't you? Gold either rockets, or it doesn't. You can always convert back to the paper world, if it doesn't, right?
The risk/reward, if our analysis is correct, is pretty clear. It's our ability to analyze that's in play here on our Forum, isn't it? To visualize and prepare for the discontinuous event that's been shouted and whispered in your ears every day of your life as heretical, crazy, can't happen. It HURTS to be a contrarian!
The dollar forces have held on by remarkable tenacity, squeezing the last out of their once-in-a-lifetime franchise. But the wealthiest class went international long ago -- the dollar is but their tool and plaything. The right things will be said and presented to the public, while they jockey for position on a different playing field.
As when a dictator falls, El Presidente will make a confident speech on the National Television, just prior to boarding a helicopter to his waiting jet packed full with the National Treasury, in gold.
I did what you are contemplating when the Bank of England first announced they were going to sell 40% of the nations' gold. First I foolishly went to a bank and explained the the loan officer ( some 27 year old optimist who knew nothing of economic history) that I would like to borrow 300,000 dollars. She wanted to know what for. So I explained to her what was going on in the gold market. I told her that the bank would hold the gold as collateral, and I would simply have to keep the interest payments current. Like most everyone else she gave me the village idiot look. She said the bank could not colatteralize the loan. At that time I felt that gold would skyrocket anyday now. Instead of buying 1,000 Oz of gold, I settled for 10 not-too-far-out-of the money call options. I mainted this position for one year. You know the ending.
I think J.M. Keynes once said:"Markets can remain irrational longer than you can remain solvent."
I also did what you are contemplating with my credit cards, except that with credit cards I bought physical. Your plan does have merit IMHO, but I would not consider it at this time until there is a clearer picture on the Marcos Gold situation. If those million tons of gold are really there; and they are in the camp of the enemy, then this manipulation can go on indefinitely.
I don't know what to tell you beyond that, but good luck to you whatever you do.
Show Me The Rooster!What will the year 2001 bring for the gold markets? Let's start with the definition of an "odyssey" from Webster's: "a long wandering usually marked by many changes of fortune". In this case the gold markets will entail a total loss of fortune and a wandering that will make Moses� look like an afternoon stroll. What is it with you flat-earthers, are you stuck in some time warp or something? Plain and simple�the POG will reach its proper COMMODITY value of $192 in 2001 and stay there, thus vindicating Robt Prechter and bringing him front and center CNBC. Long live King Dollar!
I don't say this lightly , but with careful thought and much study����..THE TREND IS YOUR FRIEND! What more does one need to know? Let's see, who should I put my money on? 1. Those that have all the gold , make all the rules, and totally control the global economy/mindset. 2. Some flaky, anti-establishment, wishful thinking, internuts with delusions of "goldeur". This GATA group is really something else---some X-Jock, a Jimmy Olson wannabe, and a lawyer/miner taking on the eminent protectors of sound money and utmost principals. I don't see a contest! Give me Rubin, Green$pandex, and Luis Ruykeyser {sp} any day.
What is this foolish gold fixation??? Obsessive compulsive disease? We are in a perpetual prosperity period and you guys shouldn't be rocking the boat. If anything malfunctions it will be YOUR fault. If there was any sort of problem Maria Bartoromo would be telling us loud and clear. I think you hard money guys are overcompensating for other deficiencies in your lives! You know there are medications for OCD and other "failures" {fix that damn erudition}. Just buy the drug stocks like normal folks do, and sit back and await your fortune. Why do you think all these mutual funds/stocks are Federally insured?
Politics? What's to predict? Total competency everywhere one looks. Dubya is there, as well as a couple unofficial "Shadow Presidents", plus the PuppetMasters; what could possibly go wrong? The people with the real brains and credentials have thought all this out fully! Trust them!
Let me make sure I understand upon what this site is basing its premises.Some guy posts anonymously and explains all of the supposed interworkings of the world's monetary system. This guy has an anonymous amigo that further elucidates the other unknown guy's unclear writings, neither of which speak or write the King's English. Put all of this in the context of some ancient Castle/Jousting/Knights and what do you get? What a country! Now they are offering FREE gold and silver. Let's be reasonable here...... It can't be worth much if it's free, RIGHT? Have YOU ever received any free gold?? Stick with the crowd, there's safety in numbers, leave your emotions out of this. If these guys really knew anything they would be on Giraldo or Oprah.
Bottom line--------- 2001 will definitely be "interesting times"!
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner will be the one whose arrow falls most closely to the mark. All price guesses must be accompanied by sound reasons for your prediction to gain the prize.
=====SOUND reasons ? How about just written ones ? <;-)
OK--It will be the same go no where COMEX market UNTIL after the start of the GWB era. AND, nothing will happen for a period of time as the new administration will be using trial balloons for a while. SOMETHING, will happen to awake the Sheeple that INFLATION is here in SPADES ! BUT, that will be a later story. Please send my winning Ag Eagle asap.
---
<;-)
Mr. Gresham,
Yes, I see a point that you made about the "Strong Hands" policy of FOA. It is not of his opinion to buy and sell for a quick profit, or to buy and be forced to liquidate portions to pay ones way out of an unexpected Jam. But to Buy and be financially "strong" enough to hold without someone or something ripping it from those hands. That almost insinuates that FOA believes there will be factors arising which could pull gold away from those with weak financial foundations-topic for another discussion I guess.
Of course, one other topic for discussion, and one that has been brought up before, is how, in the end, will we utilize our gold that we have held onto to our financial benefits?
But I digress. I also agree that a fixed rate mortgage type would be better that credit cards for such an undertaking as this. Thanks for sharing your mind with me this afternoon.
Journeyman,
It all, in a way seems as a gamble to me- a gamble of how longs. How long do you hold your excess FRN's before exchanging them into Gold. HOw long will you be able to accumulate this specific asset before it can't be accumulated at any price. 15 years, 15 days, the estimates are as varied as the number of crashing dot.cons. And being a man of very modest means, I sometimes feel that time runneth out. As Mr. Gresham said it is hard being a contrarian. The only advantage to being a sheeple is the knowledge that at the last you will not be the only one swinging from the lamppost.
Though I do not feel we as contrarians will swing. Only time will tell.
Thanks for the thought provoking discussion this afternoon.
I saw a program not too many weeks ago about the continued search for Yamashita's Gold in and around the Philippines. Very interesting, wish I had the opportunity to be a part of those expeditions. I believe the program estimated the amount of Gold still buried to be in the Billions.
I think though, since Sir journeyman graciously declined to cosign my loan, I will be paying cash on the barrellhead for my future ASSET purchases.
p.s. The other day I had a show and tell at the local waffle house with the waitress, myself and a K-rand. She picked it up and tried to open it. She thought it was a piece of chocolate.
The copper-silver relationship in conductivity lets you gain up to a 10% savings in energy at high currents and voltage. At current prices of silver and current prices of electricity, some high power short runs might be replaceable with silver or silver-copper lines, freeing up some minor energy for other users.
This may not mean much to you big timers, but, I just went to buy my regular amount of gold eagles 1oz., and there were none. Questioned the dealer about it and he stated he can not keep them in the case. also one week order time. I had a set plan of procurement, now it seems I have to rethink the plan. Did somebody wake up! I am going to have fun with this behind the scenes rally. Wonder how many more are thinking like me.
GO GOLD!
Way to go slingshot! You are talking my kind of plan!
Accumulate gold over time all the time, every week, every year, every DAY, every next time! TAKE IT OFF THE TABLE! HOW LONG WILL IT TAKE TO BREAK THE GOLD PAPER GAME IF WE HAVE COMMITTED PEOPLE TO TAKE IT OFF THE TABLE? I have got time, if not, then my sons have time, if not, then my grandchildren have time. They are not going anywhere! I WILL TAKE THE LEAD AND TEACH THE WAY! This is where, in my opinion is where GATA is ALL WRONG. JUST MY OPINION!
The Tower's look at today's release of U.S. International Trade data & GOLD
With values measured in units called dollars, America's shortfall of value in exported goods and services compared to the value we imported was chalked on the wall at $33.0 billion for the month of November. The blessing in all of this is that, once again, America was allowed to compensate its trading partners for this shortfall by simply crediting the foreign accounts with 33 billion of these meausuring units (dollars) that we can print or create digitally.
Thus far, our record-setting trade shortfall remains the $33.7 billion mark set two months earlier in September (revised data for October came in at $33.6 billion). And with one month of statistics remaining before the year 2000 is officially in the books, the overall trade deficit is on pace for a $366 billion shortfall, shattering 1999's record of "only" $265 billion by more than $100 billion. Wow.
Specifically, the preliminary numbers for the month of November revealed by the Department of Commerce today measured the month's total export value at
$90.4 billion and imports at $123.3 billion.
AND NOW GOLD
From the perspective which is of interest to this forum, we are also running an imbalance in international gold trade, meaning, more outflow than inflow. Gold exported in November was up $91 million in book value from October levels, to $0.559 billion. In contrast, November imports of gold was only $211 million. That translates to a net gold outflow of $338 million; approx 39 tonnes.
Year-to-date balance of the gold trade reveals a NET gold OUTFLOW of $2.958 billion, representing very approximately 330 tonnes. With annual U.S. gold mining providing only approx 355 tonnes, any outflow figures for December comparable to what have just now been revealed for November will mean that the equivalent of ALL new U.S. gold was sent abroad, and then some.
Conclusion from these numbers, as the "richest" nation on Earth, and with the farthest to fall in a crisis, we sure seem to hold our own paper as unimpeachable, do we not? Are you willing to trust your own hard-earned wealth (and your future security which it represents) to the fate of the world's confidence in our currency?
Foreign trade partners have really upped their call for our available gold supplies. While figures through November for 1999 revealed demand for $4.458 billion in gold, the year 2000's numbers are 21% higher, coming in at $5.414 billion which has been exported year-to-date.
Be a nation unto yourself and follow this worldly example. They are getting their share of earned wealth in gold. Are you getting yours?
No one will make your decisions for you to take action one way or the other...but we do try to equip you with the best information. The rest is up to you. Know this: the kind folks at Centennial are at your service, waiting to do your bidding.
I think you've touched on something that we haven't heard much about which is the status of physical gold availability and its price (premium) over the last couple of weeks since the price has slumped yet once again.
Seems to me that the price of coins have held their premium despite the drop in the spot price lately. Hmmmm.
On availability, perhaps your plan of acquisition is ok, it may be your choice of vendor you need to re-think.
On Sir Peter's nomination of Al Fulchino's msg#: 45880...
I'll offer a second to that nomination. I think the following snippet was particularly on the mark:
"We calculate all manner of means to understand why gold is not valued higher, when it will go higher etc. Waste of time. Total waste of time. True value of sound money is not a supply and demand issue it is and always has been an honesty issue."
Inspired by your comment:
"...until there is a clearer picture on the Marcos Gold situation. If those million tons of gold are really there; and they are in the camp of the enemy, then this manipulation can go on indefinitely."
As can be gleened from my last post, the most powerful nation on Earth -- blessed with a large and technologically clever populace, abundant natural resources, and a vast network of supportive infrastructure -- is only able to produce 355 tonnes of gold per year through the highly scrutinized efforts of its publically owned mining corporations. Fanciful notions notwithstanding, where in space and time did mankind EVER find either the human inclination or capability to gather a million tonnes of gold from the firm embrace of Mother Earth?
Certainly, do not trust the precision of the conventionally accepted numbers of 130,000 tonnes as sum total of all past accumulations, but they come nearer the mark than the output numbers that could only be achieved through the efforts of Paul Bunyan and Babe, his blue ox. (I have it on good authority that Mr. Bunyan spent his days lumberjacking, not secretly mining or panning.) Let your common sense as born and raised unto the physical world be your guide in this and all things... Numbers are, after all, just numbers.
Have ice in my veins
More often than not;
And custard for brains,
Or so I once thought.
Had no opinion;
Open-minded start.
No "goldbug" minion;
Justified "Goldheart"!
I would be inclined to suggest that anyone willing to begin a journey of unbiased thought on the significant Earthly matters of the Here and Now as a natual consequence and extension of all deeds Past will find that all roads lead to gold. Seek for the sake of seeking, and you shall arrive in due course to a place where you find gold at every turn.
USAGOLD (01/18/01; 19:34:02MT - usagold.com msg#: 45876)
To FOA. . .A challenging question from the C-Man. . . .
Michael,
Thank you for inviting me up here, on stage. I'll offer some frank discussion to Mr. Cavan Man's challenging question. Only, I hope my oratory doesn't drive the audience from their seats. (smile)
---------
Hello everyone,
I assume you were all given and have reviewed USAGOLD's #45876. Good, then we can get right into it.
C/Man's permanent question is; "Why doesn't Greenspan do something about this? He must see what's coming."!
This crosses all the endless boundaries of political vs human wants and needs. Any answer to such a question exposes our own reality of just how much we all live together and compete together. As I mentioned before; we all are floating down the same river of life,,,,, bickering and debating, living and working,,,, even taking each other into court and war,,,,,, and doing all this as our floats ride the same current of water to it's destine end.
To better understand my replies, let me profile myself a bit. In both the physical and mental image.
The physical:
Am obviously a male and in the second half century of my life.
Have been married only once, to the same wonderful woman for several decades.
I am religious, understand the bible and do physical deeds to convey that knowledge to others.
I strive to live a moral life in every physical sense.
Am in good health and work at treating others as I want them to treat me.
The mental
By some gift of destiny, I know the people world around me. Perhaps better than some?
At all times I am intensely aware of the diversity of human life we all must operate within.
Myself and each of us have our right and wrong codes we live by and these are not always the same.
Yet, and because of this, society as a whole must function thru consensus or make war.
I fully well understand a successful person's (and nation's) feeling that they alone made their way in this world thru hard work and self sacrifice,,,,,, and I admire that pride and courage.
I also well understand that, by far, 99% of these people got where they are at with luck and good fortune,,,,,, more so than their special talents or moral good deeds.
And too, I bridge boundaries of thought, without judgment, in order to promote a common good.
So,
From that "heavy" description, I'll lighten the room a bit with a true short story I find most remarkable for it's human clarity, scope and definition as it applies to all of us (smile):
------I was once at a bar in a very exclusive, very private country club. In this part of the club there were no waiters, only a large team of bartenders that always stayed behind the bar. They would be fired, on the spot if they walked onto the small club floor. By code, this area required members to get their own drinks for ourselves and others. Kind of a step-down from the "big life" so as to bring us back to "regular status". The talk was very friendly and no business discussed.
A new guy, who I'll refer to as "newguy", had just come of age (new money) and wanted his place in the group. I think he was Australian, if my memory is correct. Standing at the bar, within a crowd, he boasted openly about his new boat, 14 meters+/-, and how cheap it was to operate. Conveying a sense of wealth availability. "At this rate I could have several",,,,,,, he said this with a smile and an honest intent. But I (and other older men) knew his motives were as usual for fresh money. After a short chat, he felt like he was fitting in and really making his position felt.
Then, (I'm laughing as I recall this) another much older member strolled up for a drink, just catching the tail end of newguy's talk. Now, you have to understand, this other fella was world class wealthy, but you would never know it. His way was always light and easy. He poked his head into
the group and told newguy,,,,, in a low gravely voice:
---"Boy, you made a good decision on that one! I also down sized to one of those little boats. Saved me a tonne of aggravation. Hell, I now have the rest of my slip rented out to two other members. Good for them for having the space,,,, and good for you for doing the same. You know, the world doesn't need attitudes like we used to have. Good un Mate! (as he walked away)------
Ha! Ha! Ha!,,,,, everyone around newguy kept a straight face as he kept the beer mug at his lips, while looking at us over the top. Then he lowered the glass and said with a straight face,,,,,, ----"He's right, ya know!"----
Ha! Ha! Ha!--- then we all had a great laugh -----------
Ok, where was I?
That story not only tells us who we are in society, but how we react against competition in society. Sometimes the act is extended into a life long play. The above little interaction is carried out in board rooms and on the street,,,,,,, at the CIA and between nation states. No matter if one is rich or poor,,,,,, buying and selling countries or teacups,,,,, operating businesses or pickup trucks,,,,, we all do our part to "puff up" as a defense against the world we perceive is out there. We adapt into
the social and business flow that's at hand. The norm of the occasion,,,,, and the political reality that's in our world around us. Our personal codes of life are often at odds with the consensus of the diverse world we must operate in. Such is life!
You see, in real life, we must often take on the appearance of that world around us. This action isn't lying or cheating so much as it is trying to act out a play that is essential in dealing within our hugely diverse society. A society, by the way, that is mostly made up of people that aren't "the good ones" as we so often perceive ourselves to be.(smile)
This line of comment now lays a foundation that takes me to politics. As I have come to understand the captain at the helm,,,, the driver of the corporation,,,,,, the general at the controls,,,,, they are all just like us. Working outside our personal moral standing standards, they must function using a diverse crew that's usually not of the same thought. Do these leaders lie and cheat if the stress becomes great enough? Of course, how do you think the ,,,, workers of different moralities are jostled to perform,,,, the job gets done and profits get made,,,,,, ! Do these bosses all get caught? No, the ones we extol as "good ones" don't.
Does the democrat tax and spend? No more than the republican borrows and spends! Is your group's moral or business objectives correct for the country? Only if they apply to the whole diverse society. Otherwise, you are imposing a will upon others.
Now, with that overview in mind:
Is Alan Greenspan doing everything he can to oversee a fiat banking system while functioning within our political society? I can answer that with .9999% certainty. Yes! In fact, throw a few extra 999s on that answer (smile).
You see, a nations rules, laws and moral requirements are never more than a consensus vote from changing. In such an environment, no leader can function for long at his own or our own standards. The office, itself is a reflection of power groups pushing their own position and that requires us to make our personal codes just that, personal codes. Not public codes.
Any person of clear vision could stand upon the highest mountain, look 360, and see that this country is not the same body it started from. Our codes of conduct, perceptions of right vs wrong and even our attitudes of wealth have all been diluted from other sources. This is not to say it's
good or bad, as this dilution often comes from foreign political perceptions that preceded our nation' history. In some ways, it predates many generations. Right or wrong, good or bad, some of these accepted political directions have been used a long time.
Mr. G. is not trying to make us something we as a group are not. He cannot. His objective is to support, prolong and protect our financial system as it must operate in it's present evolution. Make no mistake, he and every leader in his position understands that fiat money systems are always in evolution. There is not and never has been a status quo when it comes to a nation's money. Recent history is ripe with such change, even during the usage of gold within the currency stable.
I can assure all of you that our fed chief does not confuse a strong vs week dollar with a stable fiat money system. This current strong vs week dynamic, happening over the span of 20+/- years is little more than wafting from bank to bank as we ride the river that is our currencies timeline. Our
dollar is evolving even as our society evolves. It's use as a world reserve and even as a medium of exchange was never written in some code of world conduct or acceptance. Circumstance and consensus will change any currencies worth regardless of who manages it's trip through time and space.
So, there you have C-Man. I wish you had asked earlier? Because; "I didn't know there was a problem." (smile)
I think you're on to something there. Ultimately, it will come down to an issue of the supply and demand of physical gold and a strategy of orderly acquisition over time via disposable income when adopted by enough people will be the death knell for those who would try to manage the price of gold through other means.
Consistent with Al Fuchino's recent post, nothing else is going to have an impact.
I haven't posted here in a long time, I've just been too busy sorting out some other things. But I've been looking through the posts lately, because things seem to be heating up a bit in the markets. I wrote this letter to Bill Fleckenstein last night, because I think there is another possibility of what Al Greenspan is up to. So since you're thinking about Greenspan, and for what it's worth, here's my letter:
...ooOoo...
Hi Bill,
After reading your column tonight, my wife and I
talked about Al Greenspan. We both remember reading
some of his writings from the '60s. His philosophy is
diametrically opposed to his job function, as he is an
objectivist libertarian! My wife brought up an
interesting idea: if you've read Ayn Rand's "Atlas
Shrugged", you will certainly remember the character
of Francisco d'Anconia, who fought the system by
helping it to collapse under its own weight. Now, Al
was a cohort of Ayn Rand's. What if he is a real-life
Francisco d'Anconia? I started reading about him on
the web, and I found this: 'According to Nathaniel
Branden, Rand's one-time "intellectual heir",
Greenspan has said in recent years he still would like
America to be on the gold standard.'
(http://www.interlog.com/~grantsky/greenspan.html)
...and this:
'From the start of his political career, questions
have arisen about Greenspan's political beliefs.
Shortly after his appointment to the Council of
Economic Advisors, he was asked on "Meet the Press"
whether he had changed his opinion, published years
earlier in a Nathaniel Branden Institute pamphlet,
that anti-trust laws ought to be abolished. He replied
forthrightly that he continued to believe they should
be, but he was well aware that such a move would be
politically unpalatable for the foreseeable future.'
(http://www.theamericanenterprise.org/taeso97a.htm)
From the same article:
'Greenspan had recommended to a Senate committee that
all economic regulations should have fixed lifespans.
Senator Paul Sarbanes (D-Md.) accused him of "playing
with fire, or indeed throwing gasoline on the fire,"
and asked him whether he favored a similar provision
in the Fed's authorization. Greenspan coolly answered
that he did. Do you actually mean, demanded the
senator, that the Fed "should cease to function unless
affirmatively continued?" "That is correct, sir,"
Greenspan responded. "All right," the senator came
back, "the Defense Department?" "Yes." The Senator
could scarcely believe his ears. "Now my next question
is, is it your intention that the report of this
hearing should be that Greenspan recommends a return
to the gold standard?" Greenspan responded, "I've been
recommending that for years, there's nothing new about
that�. It would probably mean there is only one vote
in the Federal Open Market Committee for that, but it
is mine." '
...and this last one-'Barbara Branden observes, "Alan
believes in the art of the possible." '
I know he sounds whacked, but what if he really knows
what he's doing? In the last part of Atlas Shrugged,
after Dagny Taggart and Hank Reardon hear the news
that d'Anconia Copper has been totally destroyed by an
explosion, they read Francisco's note left on a
calendar: "You asked for it, brother".
Consider this another second for your nomination. Al Fulchino's msg#: 45880 is a powerful treatise on why all of us should shun the purveyors of paper money. Civilization was built on hard money. The last 100 years on this planet have been a great time of turmoil as paper money has corrupted all the political institutions.
Christopher, Mr Gresham, barnacle bill, Hoosier, JavaMan, all
We could move the market. According to Randy's (msg#: 45938), If about 29580 of USAGOLD readers all second mortgaged our houses for $100000 each, we could buy up just about the net amount of gold that left the USA in the last year. That would really goose those paper traders! (not investment advice) --
Randy. 200 tons a year for 5000 years. I don't know how the pyramids were built either. They look impossible to me also.
New commentary can be found today at "The Rocket School of Economics"
http://www.usagold.com/gildedopinion/RocketSchool/vonBraun.htmlClick the link to gain access to the current commentary and to the archive index which contains an additional item today from the good Professor which I did not have previously...on the bursting of Wall Street's bubble.
Kind sir: I am flattered that you would even respond to such an obvious, sub-intellectual and emotional question. Why, I had just stopped by for a brief moment to state, what a wonderful venue to while away the hours (and years) waiting upon vindication of thought and belief. I thank you....CM
What a wit! Look, nine holes anytime; name your club.
Best.....CM
PS: My people were potato farmers and very unlucky. As we're wont to say, we have about as many connections as, "a burnt fuse". My greatest luck has been to make your virtual acquaintance.
"Randy. 200 tons a year for 5000 years. I don't know how the pyramids were built either. They look impossible to me also."
Sure, any combination of production values over years will provide the fanciful number, but will not provide for the sustained secrecy that must accompany it...otherwise this would not be "black gold" above and beyond the recognized yet still impressive (impossible?) historical production. One would think the history books and archeological evidence would be rich with tales and displays such overwhelming pre-Columbian bounty, no?
What say we ask YGM, our most favorite miner, if such numbers are viable without the aid of modern infrastructure and technology?
Otherwise, we are left only to ponder the grandeur of the black pyramids which as assuredly were built above and beyond those that have been accounted for, and the accomplishments of many moon landings that did not survive the oral traditions of our cave dwelling ancestors reaching back into antiquity...leaving us only with imaginations to fill in the gaps of astronautical marvels of what surely occurred prior to 1969.
"This shipmates is that other lesson; and woe to that pilot of the living God who slights it. Woe to him this world charms from Gospel duty. Woe to him who seeks to pour oil upon the waters when God has brewed them into a gale. Woe to him who seeks to please rather than appal. Woe to him whose good name is more to him than Goodness!. Woe to him, who in this world, courts not dishonor. Woe to him who would not be true, even though to be false were salvation. Yea, woe to him who, as the great Pilot Paul has said it, while preaching to others is himself a castaway!"
From:
The Sermon of Father Mapple
Moby Dick (the greatest American novel)
Herman Melville
The secrecy is the easiest part for me to believe. Throughout the ages, people have hidden wealth from thieves, governments, and the taxman. (all one and the same).
I do not believe the official figures for CPI, GDP, housing starts, M*, gold, unemployment, *, *, *, *
I also believe it is a mistake to assume that this hidden gold will arrive on the scene to save the shorts. The last time it took a 20X rise from $35 to shake some hidden gold out of its hiding place.
So glad to be living in these times. So glad to be educated by a worthy bunch of posters at this forum. MANY, MANY THANKS!
Someone has to start the process, the plan, the procedure! I accumulate GOLD because it is REAL MONEY! I may never see the day when the benefits are realized for the actions regarding GOLD that I am undertaking. Nevermind, I hope I have set in process a plan, procedure, that is carried on by my sons, and then by my grandchildren, and then by my great grandchildren, and then by my .......,. I do not care that I am ridiculed by my sons' economics professors at PURDUE UNIVERSITY that I am an unintelligent, radical, right-wing, nut. Some day my actions, my sons actions, my grandchildrens actions, etc. will materialize in benefit, no matter which direction it takes. I AM NOT CONCERNED IF IT DOES NOT HAPPEN IN MY LIFETIME! I wish my great grandfather, my grandfather, my father had denied themselves some consumption in order to hand down through the generations THAT WHICH IS REAL, GOLD. No matter, I WILL BE THE FIRST!
I also collect stamps, the mint variety. I do not care as most have ridiculed my actions as being a bad investment. I do not care that 300 million of the 500 million ELVIS stamps have been hoarded, and I may never see the day when they increase in value more than the thiry some cents I paid for them. MAYBE NOT FOR ME, BUT WHAT ABOUT THE NEXT GENERATIONS. I wish someone would have handed down to me a sizable collection from a prior era! THIS IS AMERICA! I CAN BE AS STUPID AS I WANT TO BE AND I WILL NOT BE SHOT FOR IT! EVEN IF I KEEP DOING THE "STUPID" THING OF EXCHANGING FIAT FOR "REAL" I WILL NOT BE SENT TO, IS IT SIBERIA?
It is easy to be a critic
The solution for monetary policy makers everywhere is to peg their own
"policy" to the way that the nation's currency interacts with the freely
floating gold market price. This way, they can more easily monitor that
elusive character of prices, influenced by a change in the currency's
purchasing power, and adjust policy accordingly, maybe properly, and
certainly with accountability. What an achievement that would be, and
the Internet just might help us do precisely that. How? By encouraging
the evolution of a freer press and thus, a freer flow of information.
Though, the question must be asked:
Can the Internet function in the private sector without the assistance
of the government? Perhaps it is a relevant question in today's elusive
profit picture.
The Point of Recognition
This point, therefore, cannot be too far away. But as long as currencies
can still be "managed," so can gold prices. Thus, it is this argument,
which is central to the gold debate, and it is when investors realize that
the daunting task of managing a currency is a banker's version of
utopia, that gold prices will soar, and never look back!
The only time that a group of people generally will all agree that there
hasn't been any gold manipulation, is when they want to do a stock
deal.
So, it may be next week, next month or perhaps even a few
months down the road. But everyone (including Mr.
Greenspan) better well be prepared for The Wrath of Mr.
Market. He hasn't been around these parts in a spell and
all the townsfolk, especially the drunken gamblers and
gunslingers down at the Saloon, have long forgotten what a
tough Son of a Bitch he can be. He doesn't like
troublemakers and has his own way of dishing out his own
ferocious brand of punishment. Mr. Market does it on his
terms, is unpredictable by nature. But boy can he be quick
as lightening, with his punches landing with shocking force.
We've been on the lookout for him but don't see him quite
yet. He uses the element of surprise as one of his best
weapons. He's on his way; make no mistake. We can
already hear his intimidating voice now: "The raping and
pillaging, the fun and games are over for all you wild
cowboys, drunks and card sharks. All this BS has gone on
for way too long and has gotten way out of hand, so I have
no choice but to bring it all officially to an immediate end.
From here on out, there's going to be some law and order in
this here town. I'm changin� the rules and I'm going to
enforce them with an iron fist. You might darn well get
used to it. From now on, we're going to do things with
some discipline and respect. There's a new sheriff in
town�"
Had USAGOLD posed this question in Jan '98, '99, or '00, my "Gold-to-da-Moon!" answer would have been proven incorrect over a similar timeframe.
These last couple of years have increased my respect (for the People & Orginisations who "manage" the affairs of Money and Gold in the "Free" Market) to such a degree that I'm firmly convinced the status-quo can be maintained for "several" more years yet, why already this year the 50bp int. rate reduction has been all but negated in the Market - and so will the next one...and the next, etc.
If my thinking is clear, '01 will be a good Year for "NEW" Tech, DOW, Tech, OIL. Au otoh will underperform.
It all comes down to Fiat management and IMO they're (currently) managing just fine.
There was a bit of news at the end of a guest editorital in today's Wall Street Journal. It could be very bearish on our favorite currency.
"The Clinton administration, as part of its last-minute rush of new regulations, earlier this week proposed that U.S. banks be required to report deposit interest earned by foreigners to their respective governments. This would be bad news for the U.S. economy, which greatly benefits from the inflow of foreign captial."
If anyone has any more information on this development, the Lords and Ladies of this forum would like to know about it.
In the classic Decline and Fall of the Roman Empire
Gibbon mentioned that the most 'easily' overcome opponents
or city states were those which had failed to arm themselves or do battle for a number of generations, esentially breeding a pacifist strain, and were brutally over-run time and again. Does the word "Canada" come to mind?
Thanks, everyone who tried/commented on my revised
website. I have just-now finished a marathon update of
most of the HTML code within it.
Tweeking and adding features that some of you may find
informational or fun.
For convenience, you only need to BookMark the above link.
If/when you or anyone surfs back to it, it's best to hit your
"refresh" button (or F5 Key) to initially refresh your browser's
cache there. Else your cache will still be retaining the old
previous HTML code and so, you wouldn't see most of the
revisions. Alot would just be missing.
Could the California electrical problem could lead to a return to gold as money?
All day today after reading story after story about California's problems I just kept thinking about this issue.
What kept popping in my head was Article 1, Section 10 of the US Constitution.
"No State shall make anything but gold and silver a payment of debt."
What kept popping into my head was the word "States".
So here we now have the California Utilities losing their credit ratings and rumours are wispered that the State of California may actually lose it's own credit rating.
Now I read somewhere that the State of California was going to intervene and purchase some natural gas for the utilities.
Ok, now since Article 1, Section 10 is in reference to States, then private individuals and corporations should be able to make contracts for payment in cash or whatever they want. But if a State is to pay for something it is required to pay in gold or silver.
With the State of California's credit rating now in question, why would any individual or corporation want to risk being paid by some entity that can't get a loan.
So if the State enters into a contract with an out-of-state utility for energy supplies then that utility should be able demand payment in gold coin from the "State" for the product. Plus they should be able to demand payment before delivery.
I know if I was the owner of a utility and was selling to a State or entity that had credit problems I wouldn't sell them anything on credit. They may not pay you back.
-Is there any way a company could use this idea? Or am I just completely wrong in my idea?
I just re-read my last post.
Yuck.
Awful sentence structure and spelling.
I am going to have to stop typing and watching TV at the same time.
My thoughts just get way too distracted.View
Yesterday's Discussion.
A HOARD of Roman gold coins, discovered in the City of London during an archaeological excavation last year, have gone on display at the Museum of London (Grainne Gilmore writes).
The 43 gold aurei, pictured above, are estimated to have been worth nearly four years� salary for a Roman Legionnaire. The 22-carat gold coins carry the images of ten Emperors and two Empresses, ranging from Nero (AD54-84) to Marcus Aurelius (AD161-180). The hoard is the first to have been found in London � there have been only two comparable collections of Roman gold found in the British Isles. The rarity of the coins makes them of incalculable worth today.
The coins are on permanent display at the Museum of London.
An exhibition at the British Museum also features Roman coins. From Alexander to Mark Anthony: Images of Power on Ancient Coins illustrates how great Greek and Roman leaders used the images of themselves on coins minted during their lifetimes to manipulate how they were perceived. A major theme is the image of Alexander, how he formed and changed it and its impact on his royal successors. The silver coins of Mark Anthony from 30BC show him wreathed in ivy, a reference to the Greek God of wine, Dionysus.
< Now let's assume an "aurei" is (roughly) equal to a Sovereign Au wise, 43 "TODAY" can be had for (ballpark) $2800..... 4 years wages in Roman times.>
Is gold cheap? ......Yes/no.
Will it stay this way? ...Yes/no.
Can 43 Sovereigns "ever" amount to 4 years wages again? ...Yes/no.
Think about it... 2.5 Oz Au annual salary, thats the leverage of Gold!
http://www.msnbc.com/news/515376.asp CABIMAS, Venezuela � The rigs that dot Venezuela's Lake Maracaibo may soon be pumping a pinch less oil. It's a small price to pay for this oil-dependent country. By cutting back on production in concert with fellow OPEC members, Caracas is seeking to avoid a repeat of 1998, when plunging worldwide oil prices sent Venezuela's economy into a tailspin. But this time around, the biggest risk for Venezuela and the Organization of Petroleum Exporting Countries is that rising oil prices will tip their biggest customer into a recession that will resonate around the globe.
"WE CANNOT allow oil (prices) to fall again under any circumstances and under pressure from anyone," Venezuelan President Hugo Chavez said Monday. Chavez was, of course, referring to the United States, which imports more than half of Venezuela's oil. Like last summer, when oil leaped above $35 a barrel, sending gasoline prices soaring and enraging American and European consumers, the United States has been trying to convince OPEC to hold off on production cuts."If there is a steep production cut, we believe that prices will go up dramatically, and that is going to harm the world economy," U.S. Energy Secretary Bill Richardson said Monday after a four-day tour of six Persian Gulf oil producing states.
The United States argues that rising energy costs will depress earnings in the manufacturing sector and lead to a flash of inflation. If the suddenly tippy U.S. economy slides any further, American economists say, there will be a domino effect around the world, oil consumption will fall and OPEC will suffer. Right now, half of U.S. oil imports are from OPEC, making the United States one of the cartel's biggest customers. But while the American argument resonates, OPEC is haunted by memories of a timing mistake that cost its members� economies dearly. Back in 1997 the cartel increased production just when Asia was sinking into severe recession. The combination proved devastating; the sudden lack of Asian demand along with the increased production sent oil prices diving to near $10 a barrel. Venezuela saw its economy contract by 6 percent the following year. Now, OPEC wants to avoid a similar situation. It argues that demand for oil will once again drop in the spring after the heating oil season, and that then prices will naturally ease without causing the economic disruptions its members suffered three years ago.
PETRODOLLARS AND VENEZUELAN POLITICS
For Chavez and Venezuela, oil is the engine of change."Hugo Chavez has made promises about social benefits, about things he is going to deliver to the people of Venezuela, and he is not going to deliver that without higher oil prices," says Amy Jaffe, senior energy advisor at the James Baker Institute at Rice University. Oil accounts for as much as a third of Venezuela's gross domestic product. Even with a cutback in its OPEC oil quota, Venezuela is expected to reap higher revenues. The formula, says Alejandro Bertuol, an oil analyst with Fitch Ratings Service in New York, is that every $1 increase in a barrel of oil translates to between $1 billion and $1.4 billion dollars in additional revenues for Venezuela. For a poor country like Venezuela and a president intent on perpetuating his "economic revolution," oil is his bank. And Chavez's "OPEC strategy has been brilliant in many ways," says Larry Birn, the director of the Council on Hemispheric Affairs in Washington. What Chavez has managed to do is help convince OPEC members to stand firm, even under pressure from its biggest customers. He has learned the lessons of previous governments, which flagrantly ignored OPEC quotas and suffered from wide fluctuations in oil prices and oil income. Chavez's discipline with the quotas over the last year,"guarantess that Venezuela will have a predictable flow of available money not only to prop up its economy but to play a significant regional role," says Birn.Of course, not everyone agrees with that assessment. Jaffe argues that Chavez has shifted economic resources toward his left-leaning social programs at the expense of the oil industry. She says that Venezuela's oil capacity is dropping significantly every year and is in need of significant investment to keep it humming. Many oil experts agree. According to one account, 700,000 barrels of Venezuelan oil capacity is lost each day (left unaddressed, that would cut total output by more than 20 percent each year), requiring constant investment in exploration to maintain steady production. With that in mind, Chavez has been shifting the industry away from crude production and toward petrochemicals, refining and natural gas. At the same time, the state oil company, Petroleos de Venezuela, has intensified its focus on Latin America as a market. Still, it is unlikely � despite Chavez's tendency toward negative American rhetoric � that the United States� importance to Venezuela as a market will diminish any time soon. That, more than anything, will make OPEC's production decision on Wednesday � and the subsequent economic consequences � a lively topic in Caracas over the next several months.
Black Blade: A very large importer of oil could be the final pull of the trigger that pushes the US over the edge into recession. Alond with rising energy cost, higher NG, and rolling blackouts that squeeze productivity. Well, you get the picture. GW has his hands full and Bubba slinks off scott free. Going to be an interesting year.
We export more than our currency from US shores. What of those in the "East" that have perspective not unlike those in the "West". I believe there might be many of these; yes?
This article is a good review of the NG situation, the developing crisis, and how we got into this mess. It also explores what may come. A good read, but a little "reading between the lines" is helpful too. A little dated but it can also be used to compare what the NG producers were thinking and what has come about in recent months.
PG&E Responds to Secretary Richardson's Order for Gas Suppliers to Sell to the Utility
SAN FRANCISCO--(BUSINESS WIRE)--Jan. 19, 2001--Pacific Gas and Electric Company issued the following statement in response to President Clinton's finding of a natural gas emergency in Northern and Central California, and U.S. Department of Energy Secretary Bill Richardson's related order that requires out-of-state gas suppliers to continue selling natural gas to the utility, both of which were issued today:
``We appreciate President Clinton's and Secretary Richardson's leadership in ordering the natural gas suppliers to continue selling and delivering gas into California. The gas supply situation has brought Northern and Central California to the brink of a serious crisis at a time when the state is also experiencing power outages because of an electricity shortage. We are rapidly running out of gas stored in our underground storage facilities because of cuts in flowing supplies.
``We are concerned, however, that the extremely short duration of the federal order -- which extends only through Tuesday, January 23 -- means that it probably will have only limited practical effect in relieving the shortage of gas supplies. We hope that the order will be extended, at least through February, so that it can be used to get enough baseload gas lined up to meet our expected February gas demands. Without that extension, we are concerned that millions of Californians could be in jeopardy of gas shortages in early-to-mid February -- a time when natural gas is desperately needed to heat homes and businesses.
``If gas service to residential and business consumers is threatened, then existing rules require Pacific Gas and Electric Company to meet their natural gas needs by reducing deliveries to other end-use customers, including gas-fired electric power plants, hospitals, and military bases. Therefore, it is crucial to note that serious gas shortages are still a possibility if the Secretary's order expires next week and is not extended.
``Because of Pacific Gas and Electric Company's financial crisis, nearly all of its natural gas suppliers have said they will not continue to sell gas to the utility without special payment arrangements, and several have already stopped deliveries. Pacific Gas and Electric Company has been unable to pay for gas in advance -- as suppliers have requested -- because California's electricity crisis has pushed the utility to the brink of financial collapse, exhausting available cash and credit. Unlike the situation on the electric side, the utility's customers pay the market price for the gas they use, so Pacific Gas and Electric Company collects sufficient gas revenues to pay the gas suppliers.''
Black Blade: So it goes, the Grasshoppers are stealing from the Ants. Amazingly the Grasshoppers according to polls believe that the whole energy crisis is contrived by the big bad utilities to squeeze higher rates. The southern Kalifornian Grasshopper has always been a thief. Over the last several years, he has stolen water from his northern relatives. Hell, he even had his northern relative's help subsidize the building of aqueducts to suck the north dry. During the drought years, the northern species had to conserve water so that the southern species could fill their swimming pools and wash of their driveways and side walks. Now it is energy. This southern species of locust has not had the disruption of power, yet the central and northern species has had rolling blackouts. The southern species also has been trying to force the theft of power from surrounding regions at the expense of the Ants who built power plants, who drilled for oil and NG, etc. So why is this happening? Simple - A lot of Liberal elitist Grasshoppers vote, and there are surging plagues of them infesting the southern part of Kalifornia.
What was that old song? "Turn out the lights, the party's over..."
http://dailynews.yahoo.com/h/ap/20010119/us/gas_geysers_7.htmlSnippit - HUTCHINSON, Kan. (AP) - Workers tried Friday to reduce the pressure in an natural gas cavern where a leak is feeding several gas geysers that have shot 30 feet above ground and exploded.
Black Blade: And yet, one could have way too much NG.
I assume that excerpt from your post which I repost below is your comment:
"The United States argues that rising energy costs will depress earnings in the manufacturing sector and lead to a flash of inflation. If the suddenly tippy U.S. economy slides any further, American economists say, there will be a domino effect around the world, oil consumption will fall and OPEC will suffer. Right now, half of U.S. oil imports are from OPEC, making the United States one of the cartel's biggest customers. But while the American argument resonates, OPEC is haunted by memories of a timing mistake that cost its members� economies dearly. Back in 1997 the cartel increased production just when Asia was sinking into severe recession. The combination proved devastating; the sudden lack of Asian demand along with the increased production sent oil prices diving to near $10 a barrel. Venezuela saw its economy contract by 6 percent the following year. Now, OPEC wants to avoid a similar situation. It argues that demand for oil will once again drop in the spring after the heating oil season, and that then prices will naturally ease without causing the economic disruptions its members suffered three years ago."
My meager thoughts:
US claims that OPEC actions on reduction of supply available will produce shortage, ergo soaring prices, ergo inflation, ergo recession, ergo decline in world oil demand, ergo future drop in oil prices, ergo all throats have been cut, i.e. producers and consumers of oil products.
OPEC claims that timing is every thing. Assuming that recession is already here, failure to reduce production because of falling demand will cause a glut, which will again foster an environment for $10 per barrel oil again. That failure to preemptively cut production now will cause a precipitous fall in future crude oil prices. In other words:
OPEC claims that failure of OPEC actions on reduction of supply now will produce glut during recession because of decline in world oil demand ergo $10 dollar per barrel oil again, ergo OPEC's throat has been cut.
When my youngest daughter was about 8 years old, upon enduring the umpteenth quarrel between her mother and father she said, "I agree with both of you". My sentiments exactly.
This chicken and egg argument is never ending and simply shows that a problem of this nature, the true market (the world economy) cannot be managed. It will manage itself in due time, yes?
Same problem with the Fed:
Either ease off on rates now or risk hard landing, or continue to hold the line on credit and liquidity and risk inflation, ergo future hard landing. Greenspan and Co. apparently has chosen to try to postpone the hard landing again, as if it can be postponed indefinitely. The market will manage itself in due time, yes?
A Very Positive Year for Gold Amid Economic Strife!January is the perfect time of year to examine your "fiscal fitness" Whether you're just starting out or you already own several stocks, real estate or precious metals you should strive for a well-balanced, diversified portfolio to help you weather storms like last year. After all, if one stock or sector has a down year, another may perform well.
For example, last year the technology-heavy NASDAQ lost 38% and large company stocks lost 9% (as represented by the S&P 500 Index), while medium-sized companies gained 18% (S&P MidCap 400 Index) and utilities and consumer goods each gained more than 20% (S&P Indices for each sector). Over 5 years, however, large, medium and technology stocks outpaced utilities and consumer goods. Real estate has held value fairly well. However, PMs have performed badly. But this is the real question. Are PMs an investment?
PMs are portfolio insurance. PMs usually move counter to the stock market and do well in times of economic uncertainty. We are now entering into a new period for investing. A new administration will take over today and policy is sure to change. As many here know, I have pounded the table (at times too aggressively perhaps) about the lack of an energy policy and the energy crisis. This will continue to drag on the economy. That in my opinion means that we could enter into some "uncertain" times. Diversification into hard assets such as PMs are almost a must while prices are still at near 20 year lows. This cannot last forever. The last administration has squandered many opportunities to become Ants (as per the Aesop fable of "The Ant and the Grasshopper"), and have only aggravated a growing cancer on the economy. Times have been very good over the last few years for stock markets investors, however, we have seen the new paradigm of "things are different this time." Oh really! What we have really seen is a speculative bubble that was fueled by unrealistic expectations as Dot.Com mania spread far and wide. Day trading became rampant as people quit their jobs to get the "easy money." Well the Dot.Coms soon became the Dot.Bombs, and now most are Dot.Gone.
So why is Gold still in a funk? Some claim that it is manipulation by powerful short-selling hedge funds and investment banks, other say it is forward selling gold miners, and yet others say that it is official sector sales from CB's and the US Exchange Stabilization Fund. It just might be all of these. What ever the reason, this can not continue as these short-selling interests dig themselves deeper into an untenable position. After all, these are "paper trades" that are backed by physical gold - gold that may not even exist. Such strategies will eventually implode and those holding gold will reap the rewards, or as many believe, those holding gold will more likely survive as others wail and bemoan their losses.
The energy crisis is not getting any better. There are regulatory and environmental issues that have resulted in a shortage of energy. California is just the tip of the proverbial iceberg. The EPA Clean Air Act, though a noble concept, has not taken into account of the finite resources of clean burning natural gas and the lack of exploration and production when prices were low. Now there is a mad scramble for natural gas. On e major problem is when prices were low, drill rig companies and service providers when bankrupt, went into other industries, or simple stopped making equipment. Many drill rigs went to the scrap heaps. Wind and solar power are renewable sources, yet they are not only climate dependent, there is political opposition to even take up "open space" and the loss of "aesthetic value." Not to mention animal rights, etc. Coal and nuclear? Oh boy, I can really go into the political maelstrom that would bring about. The point is, it is already too late.
That brings us back to precious metals. The economy is teetering on collapse from rising cost, much if not most as a result of higher energy costs and lost production. Earnings warnings abound week to week on Wall Street. Gold has a history of well over 3000 years - got that! Over 3000 years as a store of value! I think that new paradigms are interesting, however, history is replete with new paradigms (South Sea Bubble and Tulip Mania to name a couple). History has shown us that economies don't always "Grow to the sky" as the economic collapses in 1893, 1929, 1973, and 1979 demonstrate. The current market is on the verge of a severe downturn and the new president will be hard pressed to pick up the peices. This year is likely to bring about a breakout for gold as the situation of market manipulation and economic forces become unttenable - much akin to a juggler who is faced with keeping his eyes focused on one too many balls in the air. Something has to give, and with energy as the trigger, gold is about to run free as a mad scramble ensues with politicians, bankers, and markets makers trying to keep all these balls in the air.
In 2001 - Gold will rise and become the lifeboat that will keep the few lucky Ants afloat!
Indeed, truly it is a delicate balancing act isn't it? As in my last post, I liken it to a juggler with too many distractions (balls in the air). My question is whether or not if inflation is the simplistic version or threat, but rather, would not stagflation similar the to 1970's likely be the result? Also triggered by energy crises. Hmmm... a lot to consider as we enter into the new millennium with a new administration amid alot of potentially cold and shivering Grasshoppers. Is Cheeta (AG) really that good of a juggler? We shall see.
===========
Startups Move Offshore
To Avoid U.S. Regulators
By MICHAEL ALLEN
Staff Reporter of THE WALL STREET
JOURNAL
HAMILTON, Bermuda -- Operating out of a hurricane-proof command
center in a former U.S. military base, Paven Bratch is a tax
examiner's nightmare.
===========
& Thanx to riffer@freedom.net
It seems to me that US/Canadian crude/syncrude production can now be ramped up with the higher prices...but it will take several years. Understandably, these producers are reluctant to go whole hog and experience a similar "boom/crash" scenario that happened last time they ramped up quickly. I wonder to what extent the Administration allowed the country to become so dependent on foreign oil as part of a strategy to facilitate the construction of new large capacity nuclear facilities? This too would take many years before the first new generation plants could come online. The US now generates only 20% of its electricity by nuclear means. In this regard we lag France and Japan who have taken the lead in moving toward energy self sufficiency. The past ten years have seen an increase in the installation of gas turbine installations. While they are able to bring added capacity online quickly to meet demand surges, I doubt they make much sense for subtantiating our base load capacity. Nuclear generation is clean and the plant designs are now generically approved rather than on an individual basis. The way needs to be cleared for the advancement of construction with a clear idea on what the requirements will be upon plant closure and decommissioning so that market competition can be evaluated. These concessions must come from the state level. No new installed nuclear capacity will be forthcoming without a significant change in the uncertainties surrounding eventual closure issues.
Dear Bill,
The "last hour of the last day" is now upon us, time does fly. Sir, would you be kind enough to share a bit of the spotlight with Dubya and Laura this fine day? George is unlikely to take you up on your offer to be his full time coach for the next 4 years. Today is a glorious and sunshiny day, regardless of weather!
Thank you William Jefferson Clinton for a most entertaining eight years of Presidential Capers. The 22nd amendment to the Constitution, our country's current favorite, is still in effect and so you must now vacate what we used to call the White House. It will need to be properly cleaned and whitewashed for your predecessor's progeny's prestigious and pristine possession. There is little doubt that you have left your mark (stain) (scent) on this esteemed estate and you will, unfortunately, not soon be forgotten. The State of the UNIONS has never been so public or sleazy. We have been contacted by multiple international citizens that eagerly join us in this celebration of the termination of your tenure. The Nations ARE United and we extend to you these heartfelt and earnest, global messages:
French - Finalment il est parti! On en est enfin de`barasse`s!
Portuguese- Ainda bem one vais embora!
Thailand - Kob - Kun!
Philippine - Sa lamat umalis na!
Romanian - Bine ca au plecat!
Italian - Finalmente se ne va!
German - Gehe zum teufel!
Polish - Dziekuje oni poszli!
Spanish - AM__!
Ebonics - Get to steppin!
Dutch - Ga naar de vaantjes!
English - Good����.��Mr. President. Good Grief!
Goodbye! Good Riddance!
There has been much speculation as to what you will do, at such a young age, to wile away the hours/days while you patiently await a post-Presidency Noble Piece (spelled right) Prize, of which your subtle lobbying efforts are sure to pay off. Could we offer a few second career suggestions for your consideration? You do have vast talents, contacts, and experiences upon which to draw, and it would be nice if they finally could be tapped.
Suggestions:
1. The Robert Rubin School of Arkansas Economics needs a Dean of
Student AFFAIRS. Experience required, yours should suffice. You could in fact, be a bit over qualified, but RR can fix most anything.
2. How about starring in a komic strip called Klintoon? Actually a
Kontinuation of the last 8 years' debacle. Reruns only will be required,
PLEASE.
3. You might consider becoming a fundraiser for the American Conservation
Union. You and your Boss (Ms.) are the best thing that ever happened to
them. How is that little matter of their audit progressing?
4. Please spend some time apologizing to your not-ready-for-prime-time
apprentice, Algor, for blowing his chances to also become "One of our
greatest Presidents". You screwed up the quid pro quo. That was some
real teamwork boys, the folks back home in Arkansas And Tennessee are
real proud of you two. DelusionAl just needs a few more cycles of The
Lanny Davis School of Endless Repetitive Spin and maybe he won't give
up so easy next time. Did he sleep through too many of his Saturday Night
Live assignments? Poor Al had to pretend he hardly knew you, Bill, after
all your selfless years of service.
5. Lobbyist for the New World Order - unless that is getting a bit stale and
tiresome. You and Pinocchio have more in common than just the nose
complications. Those strings seem like they could be a bit annoying?
6. Selling franchises of the Ken Starr Emission Inspection Stations. Cost-Up
to $55 Million per inspection. You cannot run a VRWC {Vast Right Wing
Conspiracy} on a shoestring budget.
7. You could do tobacco ads on TV and expound on the benefits of not
inhaling or taking personal responsibility for your actions.
8. How about pooling your resources with O.J. to jointly get to the bottom of
Nicole and Vince Foster's untimely deaths?
9. You could just totally retire as the Founding Father of Illegitimate
Presidencies and Children. Put out to pasture so to speak (You must stop
drooling, Sire).
10. There has to be a immense demand for Hair Salons on airport runways
called- I'm Stylin' You're Waitin'! Number 42, you are clearly a pioneer
as well as an entrepreneur. The free markets await your participation and
vision.
11. Your plans for a friendly (chummy actually) takeover of Tyson Chicken
should fully succeed. You will be able to sort out all the right wings and
personally handle EVERY breast, leg, and thigh.
12. Clinton Crisis Counseling Clinic for abused women - mostly just ice
patrol!
13. Challenge Charlton Heston for NRA Presidency based on your starring
role in "The Ten Commanding Scandals". We have almost forgotten
who your Best Supporting Actress was.
14. You could mediate some more serious global problems like you did in
the Middle East recently with such great success. Move over Jimmy!
Next time if you will quit giggling every time you say the name Yassar
you might have more success.
15. Hollywood is much too obvious to even mention. Barbara Streisand is no
Marilyn Monroe, but on the other hand, she's no Monica or HRC either.
You could do a remake of "Trading Places" starring both you and
Hillary. Stand-ins could be used for the love scene, no problem there.
How about a remake of Groundhog Day starring the endless Shadow President that refused to go away?
16. Kofi is Kalling. Go feel his pain and take Ted Turner with you!
17. The PGA tour might accept you, but I doubt they will be willing to let
you keep your own score. You have assuredly hit on more ladies in the
gallery than even Gerald Ford did.
18. Much time can be spent simply waiting for the coming official
Republican apology for YOUR IMPEACHMENT. Check your e-mail
regularly. What were those guys thinking with this "rule of law"
nonsense?
19. Every Law School Library needs a Lexicon for multiple
meanings/interpretations/applications for two letter English words.
20. Your own weekly television show on FOX (in the chick house) TV,
government reforms oriented. Geraldo can lend a helping hand.
21. You will have time to write an autobiography. I should not
require much work and we can actually save you a lot of trouble
as one rather large word will suffice:
Coverupsubpoenabimbosnortscamliesmenacigarbluedressraisetaxesfbi-
Indulgentcheatdnaderivativesroselawfirms&lsaxpaulasexbentapistray-
wagdogembarrassdonnaeconomystupidiceovalmanagersjuanitashilloral-
danlassiterfilegatecopresidencyisdeceitbribestarrasprinfactorylucianne-
#^*!&%healthcaregrabjimguybubbletrialmcdougalsimpeachedlegacy-
spinpuppetdesksusanhoovernosedepositionragincajundenialwebster-
naftatrippstallnoshameparsebuddyteflonpredatorchinagateforcetroopers-
septumhousesenateoathespyronbrownmonicahedonicsgoldbuster-
internlipsmovingdraftsociopathsomaliadollyfelonyperjurerenemies-
rogerdodgerhush$stonewallsecretservicecocaineaddictivepersonality-
glibpollslincolnbedroomdysfunctionalOhellUgettheidea!
Please let me know if you need any more help on this project.
22. Find a new country in which to practice law. Sri Lanka comes to mind.
Alan Derschowitz could also stand an extended sabbatical. Why can't his
Doctors get his medication right? Is he the best you can do?
23. You will have beaucoup opportunities to try out your precious Executive
Orders in your various trailer park soirees. Hoping you do not experience
any more FEMA failures. Hopefully you can recover from the carpal-tunnel syndrome you got from signing all of that key legislation that the American people so desperately needed.
24. You could spend the rest of your life paying back favors for Lady Reno
TSE {Trouble Shooter Extraordinaire}. Will she remain on the payroll
indefinitely?
25. Ever thought of starting a Dream Team of X-Presidents? Andrew
Johnson, RMN, and WJC, not necessarily in that order. Looks like a
clear LEGACY from this angle, but you are welcome to write your own
history books and who could stop you anyway?
26. Permanent Dependent Counsel for your estranged wife, Scandal - in �
Waiting, Senatorium Hillary Rodham? Is she prolific or what? You
could play the scorned man next go- around, it worked so well for her.
Any truth to the rumor that Hill-Rod makes more than A-Rod ]
{unofficially of course}? Robert Ray really spanked your hand; how are you ever going to come up with $25,000 now that you can't practice Law in Arkansas for the next 5 years?
Global citizens are nervously holding their breath in anticipation of your next adventure; we will soon get to quit holding our nose. The world is beckoning you now, Mr. X-President; some call you Slick Willie, some Comeback Kid (Puleeeze NO), some Boy President, some Bubba, I now call you GONE! We're happy for you, Bill, but mostly we're happy for us. Sounds like the fat lady (with the beret) is vibrating her vocal chords. And no, Sir, you do not get to take the ESF {Exchange Stabilization Fund} with you!
A final word - Get some help somewhere.
Respectfully,
Auspec (FOB) (Farewell Old Boy) - Hope we haven't hurt your ego too much - - - Better get some ice on that.
Permission is hereby extended to copy, fold, bend, staple, mutilate, or forward this article. No additions please-I do NOT want to run the risk of offending our political leaders!
Governments don't confiscate - - - they STEAL - - - no, WORSE!!
Sorry about this rant, but you've been warned in advance.
What governments do is not "confiscate" - - - which implies some sort of legitimacy. What governments do is worse than stealing, and is akin to treason.
They claim to protect you from having your stuff stolen by common thieves, and then THEY steal your stuff instead.
Being robbed by your protector is WORSE than being robbed by a normal thief if only because the act not only steals your stuff, but your trust, confidence, and peace-of-mind as well. This is traitorous in the most heinous sense.
Is there any economic advantage to a dramatically lower $
Would the US gain in its ability to manufacture and market goods to the world at large through the advent of a falling dollar. Would not our exports become "cheaper" on the foreign markets and change our basis of strength from being the worlds chief money changer to becoming an export powerhouse again? Have we been too long complacent and raised a bunch of service sector saps who have no skills in machining and manufacturing. Can we again begin to gather the worlds gold reserves through hard work and innovation as this country did in its first 100 years?
- Goldshorters, whoever they are, cash their profits at the 200$ price-zone. They want to add to their paper-mountains.
- Gold-price-manipulators, have no reasons left, to manoeuver POG under 200$. Gold isn't giving any signals at 260$. With a low and relative stable POG...the dollar can weaken softly as to give the perception of smooth landing.
The vast majority of (any) paper-holders, is suffocating under invisible crash-slices. As stubborn deniers, they, unfortunately, get what they deserve. Their paper-prices are silently evaporizing.It will take a hell of a shock, before they see Gold's name " TINA ". The sept. '99 - WA-shock, has been smoothly absorbed and aftershocks, don't make a chance in the actual price-zone. Momentum has completely faded out.
Gold-price-manipulators, can loosen their iron grip on paper-gold-shorting. The political metal is in neutral signal force. It is impossible to restart a new massive stockmarket bull-run or impressing dollar-appreciation.
Time out for another mania-construction.
Attention is focussed on the bubble-unwinding and maskerade of Debt and Credit folly. POG at 265$ looks like an ideal emotion-neutral price ticket. IMO, Time is now more important than POG.
But ! Gold-producers, gave a mixed message. Anglogold / Gold Fields / Barrick...are trying to say something.
Mayby they want to put an end on the unworkable Fragmentation of the 2.500 ton/yrs - goldaddition ?
Anglogold - Oppenheimer and powerfull FRIENDS, know very well, what / how / who is going on in the wonderfull small world of Gold. The timing of the latest hyperconcentration rumors is not completely out of the blue. Difficult to guess if POG under 200$ is part of their strategy to suffocate and get rid of the embarresing mining juniors ?
They are certainly up to something. I don't buy the pure "consolidation" intensions. A cartel-like, alternative strategy, to eliminate small, unprofitable, miners...and avoiding future massive hedging...and making gold-leasing obsolete...is perhaps the underlying purpose of mega merger ? The perception grows, that they want to do something, and that the moment is rightly choosen to be succesfull.?
The main Goldproducers and Goldprice-manipulators are probably, turning their Gold-collusion, into a shy and carefull "positive" perception. Circumstantial Intuition.
Cavan Man (1/20/2001; 5:33:18MT - usagold.com msg#: 45970)
Trail Guide Question
We export more than our currency from US shores. What of those in the "East" that have perspective not unlike those in the "West". I believe there might be many of these; yes?
Cavan Man,
We export many goods & services, true. But, over time our competition is making these exports less inviting. Even now, at current exchange rates, much of what we sell can be purchased somewhere else at close to the same value. Remember, at some point, as our dollar drops in value,
domestic inflation raises local production costs enough that it cancels our much of any perceived "falling dollar advantage" in world trade.
The coming dollar fallaway will not induce any such export boom that many foresee. It will not be a saving grace for our economy. You see, in the past, such a drop in the reserve currency had the same inflationary effects on all world producing economic structures. This time, however, a
transition into Euro use for reserve and trade settlement will blanket such rising cost effects, somewhat protecting any national trading block that opts out of the dollar receive structure. The obvious advantage will become easy for everyone to see.
Even "nonwestern" players, that operate within the Western zone of thought, are not permanent in their trade position. They will shift as everyone else does. It's just a matter of time and evolution.(smile)
Before I go deep into this, I would like to hear how others would walk in Mr. G's shoes. I also have a Black Gold comment for ORO just as soon as we pass this area. I'll be back in a day or so.
I woke up with it today. That calm feeling I has 20 years ago and felt again in 84. Common sense has returned to the head of our household. We have a father figure again in our country. He may not be perfect, but God has smiled on us again. How wonderfully blessed we can be.
I tried all my life to get ahead. To work hard be financially secure and I was looking for time to be free of all my chores etc. I found this past summer, when I had more time off than not, that life has a way of coming to me despite my best efforts. I made sure my house had a 30+ year roof on it. Made sure my house was clad in brick, granite and vinyl. Even my landscape has granite edging and shrubs purposely picked to give me little maintenance. I had some time, but I noticed a strange thing. Life has a way of coming to you. Rest.....on this earth will never truly come as far as physical activity...not long term ...the wind blows, the rain pours the sun shines. Eventually despite all my efforts, I WILL have branches break, a leak here and there etc. The same will come to this new father of our country. You who are enemies of his will not care and try to tear him down. You who are his friends must understand life will come to him and to us. When it does, let's patch the roof, clean up the branches etc. They are what we grow our character by. In the end, my and your gold will not matter, nor will our houses, but in the end I believe, our souls will either shine white or in shades of white, or not shine at all. Somewhere in some dimension, that which is unseen to our physical eyes will reveal itself to us. Lets work together. Goerge W. is going to have life thrown at him. He won't be able to stop it. It is not meant to be stopped. It is meant to be learned from. It is meantto show us things and see where our chracater lies or willlie in the future. Let us who support what wisdom that resides in our new President's heart.
One last point that really hits me hard. How special is this occurrence we are about to see. A man, a simple man who is called a Chief Justice gets up before the entire world and quite simply looks into the new President's eyes. Picture yourself on either side of that eye contact. Two hearts are connected visually. Two men. Just two simple men. That justice looks in his eyes and asks this man if he solemnly swears to..... Think about that. He is asked if his heart and character will uphold a certain spirit. ASKED politely! ASKED with hope! ASKED with a yearning! And we hope, pray and trust that this new man's heart is more bright than dark. The Justice hopes so. The people do hope. And good people from all nations hope. What a very special thing we will all see. Simple eye to eye contact. A simple question. A question that means everything to us.
Today a good and special thing has come to America.
What I meant in an exporting sense was this: many in the East think like we do in the West. Ergo, many in the East do not understand gold in the context of your thoughts either. What of this? Thanks.
Please all who missed this, catch again what Peter Asher wrote the other day. This deserves a replay on this special day, because this new President IS guided by a different thing from inside himself that our last president and even many in our own families are guided by.
Also thanks Peter A and Ross L
Peter wrote:
I happened to catch today's interview on CNN and, being a non-TV-owner, this is the very first time I have seen him, live, rather than reading the printed word. This is my observation:
When people talk of Bush being a bit "slow" and perceiving him to be "not so bright" they are witnessing someone who is not programed for instant response. He is not a "Stepford" man. I see him actually thinking for himself about what he is being asked and formulating his personal answer. That slight delay is, in my opinion, the process of a basically honest man. This was not someone thinking of the "correct" answer. When asked about California's power problem, he straightforwardly said that we need to relax some environmental standards that are keeping some plants from being on line. This was not a politically correct statement to make in the midst of the Cabinet hearings.
I was especially encouraged by his viewpoint about drug use punishment. He said (paraphrased) that first time offenders should not be hit with these draconian sentences; that prison space had better uses; and that drug dependency should be seen and addressed as an "illness." Then he said, "This is why I advocate faith-based (methods)." Regardless of which faith one may agree or disagree with, faith is not punishment and faith is NOT psychiatry!
We may be at a major turning point in the downward spiral of our society. My family and I choose to believe this.
"...I happened to catch today's interview on CNN... this is the very first time I have seen him (George Dubya), live, rather than reading the printed word. This is my observation:" Peter Asher
Thank you Al Fulchino, for bringing to our attention the timely observations of Mr. Asher. They speak directly to so many of us. We, who have also not bothered to open our eyes, these many, many months. I'm sure Peter Asher speaks for many, many Americans who have also never seen our newly appointed president on TV.
So many Americans missed his snide and superior retort to the journalist who had asked him if he knew the names of the presidents of several countries. "No I don't. Do you?" Gearge answered, with an air of superiority and disdain coloring his blatent insecurity.
And for sure; hardly anyone noticed his big, big lie when he and his flunky, James Baker asserted so often, "...votes (in Florida) that have been counted, recounted, and recounted again and again...".
Most of us here in the United States of America speak the English language. Many of our families have spoken English for generations. My own family was speaking the English language before any of them even came to America, and spoke and understood the English language even before the United States of America were the United States of America. We know what "count" means. We know what "recount" means. And we know what "again and again" means.
And when tens of thousands of ballots are rejected by 40-year-old machines as "unreadable" and set aside, we know that those ballots, unexamined by any human being to determine the intent of the person who cast those ballots, have NOT been counted. Period.
Now, just because some self-interested rich kid, who grew up in a presidential family, chooses for his own benefit, to assert that ballots "have been counted and recounted, again and again", does not convince those who have been using the English language for generations, paying attention to current events, and watching TV.
Perhaps those in need of a "father figure", any father figure, even a father who grabs the reins of power through deceit and lies, are rejoicing today. And perhaps some of us do "hope, pray and trust that this new man's heart is more bright than dark" as you claim to do, and perhaps some really do hope for the best. However, the rest of us do not. We do not concur when you say "Common sense has returned to the head of our household. We have a father figure again in our country... How wonderfully blessed we can be."
On the contrary! Common sense has disappeared. It has been trampled into the ground in the service of selfishness!
We already know enough about the heart of one who would assume the presidency by taking to the supreme court the proposition that "recounting of votes in Florida must be stopped".
He who would even contemplate such action does not have the moral high ground, or the moral stature to lead anyone. George Bush prated and brayed about "leadership" throughout his campaign. All of us (except Peter Asher) saw and heard him. Yet, in the first moment that he felt the need to, he threw aside any pretense of leadership for the common good, any pretense of morality, any pretense of guidence by the constitution, and wallowed in his own selfishness.
I'm sure you feel very secure in casting aside your ability to think and judge critically the actions of your "father figure". However, I ask you: Did you agree with "father" when he said yesterday that the power industry can count on him to do everything in his power to circumvent existing envirnmental laws on clean air to give power companies, and investors in power companies, even more right to pollute our air?
Isn't the right to breathe the very air on our planet something we owe to every living thing on God's earth? Isn't that more important than any "investors' rate of return"?
Many of the Peter Ashers of this world who dominate this site with their opinion that the outgoing president's personal life must be repudiated, have convinced themselves that a new "father figure" of any sort will bring a change for the better to their financial life, and to the international gold market. They feel very comfortable with their "out with the old, and in with the new".
But they should be careful what they wish for... They might get it!
PH, you're a sore loser! You're a grasshopper, playing and singing about clean air and clean water while your state government tries to steal power from other states! Long live President Bush!!
http://www.washtimes.com/national/default-2001115223826.htmMIAMI � George W. Bush would have gained six more votes than Al Gore if all the dimples and hanging chads on 10,600 previously uncounted ballots in Miami-Dade County had been included in the totals, according to a review by the Palm Beach Post.
If everything were counted �from the faintest dimple to chads barely hanging on ballots � the Post review showed 251 additional votes for Mr. Bush and 245 additional votes for Mr. Gore.
That would have been a hard blow to Mr. Gore's hopes of claiming the presidency in a recount
Slogans and name-calling: The thinking persons' stock-in-trade.
Shifty:
Thank you for your post about Bush's extra six votes in Florida. Of course, it is completely irrelevant how many votes he gains or loses. My point has always been that "it's not who wins or loses, it's how the game is played". Bush played a losers' game. He waded into the fray screaming about how the election should not be decided in the courts. We all know what he did next. Then he advocated and sued in court to stop the lawful recount process. It doesn't matter how many votes he got or did not get. It matters only how he played the game. That makes him a loser in my book. Not Leigh's "sore loser", which she probably thinks is the only kind of loser there is. No, he's a "happy loser", whatever that is.
Leigh: You can call me all the names you want--loser, hopper, whatever. But all the other conservatives I know are perfectly comfortable with the concept of lawful commerce. As in buying power from other sources... With money... Lawful exchange of money for services is a far cry from your posture that "(my) state government tries to steal power from other states!"
And good on you for your slogans! That's very clear thinking. Here's another one for you: "Hail to the Thief!"
You jumped the gun there a bit on your post, If you had waited you could have had the opportunity to attack: "Bush raised his right hand and swore the oath of the office to which he promised to bring "civility, courage, compassion and character." His eyes brimmed with tears at the emotion of the hour." -- Are you now going to tell us he had an acting couch prep him for today's speech?
Have no fear though, your "cause" was elegantly demonstrated today by "protesters, who
chanted, waved anti-Bush signs, and at one point, slashed tires on some automobiles when security checks slowed their entrance to a designated protest zone."
Just what is your cause here PH, which of the great Democratic programs are you terrified of seeing halted? Drugging children with taxpayers money? Taking from the producers to give to the freeloaders? Have you fallen victim to the brainwashing of the "Politically Correct" insanity.?
What is it about this past eight years and the intentions of that regime that you feel so strongly was good for us?
I'll say it again --"Those who obtain office by appealing to the votes of the down-trodden, must maintain their power by creating more down-trodden."
And lastly, where did this "father figure" business come from? If I see our president as part of a family it is a brother and comrade in arms.
I haven't thought this through carefully, but here goes:
Politics fires the flames of the worst emotions, probably because we have been propagandized ALL of our lives, and we don't know who or what to believe anymore, really. Our trust is coaxed from hiding, and then disappointed, time after time.
I see our Table Round as a refuge from the worst of those divisions elsewhere, places where name-calling is the start and mass slaughter is often the ending. This is place of trust where we bring information to share, reveal our backgrounds and private thoughts (judiciously), and share our visions for a future world of integrity.
When I hear hatred pouring out toward "outsiders", whether they be Presidents or fellow citizens, I think we lose a little bit of our special "oomph". When I hear it directed within, inside the walls of this unique castle where we shelter and trust each other, that makes me the saddest.
When you take a slap at a fellow Knight or Lady, you cut yourself, too. This is true.
I do not think many of those doings "outside" of our castle are worthy of us degrading ourselves by considering them in an antagonistic manner. NOT EVEN ONE LITTLE BIT!
We are going to be here together for a long time. Act like it.
While it would be difficult for anyone in such a position, in the end, Al Gore demonstrated integrity and class by the way he handled himself in the final moments of the electoral process, despite the efforts of the Black Democratic Caucus who tried to overturn the proceedings and have him stoop to their shameful level.
Now if only those who supported him could find it in themselves to follow his lead...
I reposted your thoughts from the other day because they resonated with what I understand. Except you were more eloquent. If I had known you would be excoriated today, I would have held back a second. But then, upon reflection, I would have still reposted it. It was well said and I stand by you and your thoughts. Afterall, as I said, life comes to us. We have to be ready for the good and the bad. I am willing to take up this challenge. Here or elsewhere. Those are my thoughts while breathing good clean air here in the east, understanding that an industrial country is necessary for a good economy and a strong military and may produce some unclean air from time to time. All the while we collectively pursue better ways to balance this strength and vigor with ways to keep our air clean
Trail Guide said "I would like to hear how others would walk in Mr. G's shoes".
Let me speculate!
Mr. G. could have capped the stock market in 1995/1996 - if he had wished to do so - instead he made speeches about "irrational exuberance". This would have caused recession before the introduction of Euro - gaining tactical advantage and perhaps, making life difficult for the Europeans. In that case, Europe would be forced to support the dollar - as they have done for decades - to prevent the emergence of gold standard.
A big BTW, BTW: Among the people I'm enjoying the company of most here are those with the political views probably most different from mine.
Where else could I get to do that, and not have us harrumphing and stomping out of the room/restaurant/meeting before getting to know one another? Don't deprive yourself of this opportunity.
(Venting gets stuff "off your chest" -- if it really does, I wonder? -- but you already knew what you already knew. BFD! What did you LEARN by dissing someone else, huh?)
Didn't the Civil War include a number of brothers (cousins, other relatives) sighting each other in down a rifle barrel? What I want to know is: What politician (or economist) maneuvered them into that ridiculous situation? (Remember they had to ban the English and Germans from fraternizing at Christmastime in the trenches?)
Whose water were they carrying? Surely not their own.
Here is your place to figure out some of what YOUR interests really are. Don't be a foot soldier in someone else's army!
A test of your thinking, predicting and posting skills to occur from now until midnight (MST) on Tuesday, January 23rd. We stand at the first month of a new millennium, a time to stop and think what the future might bring. So the contest is simple as it is challenging:
To wit: Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion. We stand at a threshold -- not just of a new century but a time of uncertainty as the winds of change sweep through the world economy. There could be no better time for a contest with such a theme than now.
Your post must be at least 30 words and it must contain in the subject box the following:
**** 2001 -- A Gold Market Odyssey **** (Surrounded by stars.)
The prize will be a .1867 ounce pre-1933 French Rooster gold coin. There will be two runners-up who will receive a one ounce silver Eagle each.
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner will be the one whose arrow falls most closely to the mark. All price guesses must be accompanied by sound reasons for your prediction to gain the prize.
Also, all first-time posters will be awarded a one ounce silver Eagle if you post during the contest period -- from now until Tuesday midnight, January 23rd, 2001.
To qualify for the prize, you must e-mail jill@usagold.com confirmation citing the message number once you've made your first post. We will check each first-time poster's claim, so don't feel like you can get one by us.
We wish you good luck, good fortune. . . . . .And. . . . .
I'll straighten this out!! @ALL Bush supporters & ALL Gore supporters
The way I'm going to straighen this out is to cause both Bush and Gore supporters to declare a truce - - - - to turn on me.
O.K. Here goes!
We've got ANOTHER establishment president. One of the commentators yesterday observed that this looked like "old home week" for the Bush camp as all the old "Read my lips, no new taxes" George The First operatives were back in D.C.
Don't rest too easy, Sir Al! It may well be that Dubya is the real McCoy -- his speech certainly included a lot of the right things. But as he told us, he's counting heavily on his handlers. Many, the same advisors his father was handled by. James Baker, for example. What will they "handle" him into?
I taped him swearing his oath to uphold the constitution. How many hours -- perhaps minutes -- till he violates this oath? Keep in mind the Constitution he swore to uphold includes the following:
- Article I, Section 10 of the U.S. Constitution: No state shall
... make anything but gold and silver coin a tender in payment of
debts;
- Amendment II: A well regulated militia, being necessary to the
security of a free state, *the right of the people to keep and
bear arms, shall not be infringed.*
- Amendment IX: The enumeration in the Constitution, of certain
rights, shall not be construed to deny or disparage others
retained by the people.
- Amendment X: *The powers not delegated to the United States by
the Constitution, nor prohibited by it to the states, are
reserved to the states respectively, or to the people.*
None of these provisions have been repealed and all are thus still in force.
Of course after Clinton, what difference does law make anyway. We all know that what really counts is "what 'is' is."
How long till he joins the ranks of his "elite" predecessors?
In a conversation with Roger Ailes, Nadine Strossen,
Chairwoman of the liberal American Civil Liberties Union
(ACLU), indicates that every president since and including
at least FDR should have served prison time for violating
their oath of office to uphold the US Constitution. Ailes, a
conservative, doesn't object. It's suggested presidents
would serve their prison time AFTER they were out of office.
-A recap of segments from America's Talking, CNBC, 21 or 22
May 1995
As far as an acting coach for "Dubwya," don't be too sure he hasn't got one. Remember when Nixon lost to Kennedy? It was a strong suggestion that one of the key factors in Nixon's loss was that Kennedy had a make-up artist and Nixon didn't. Ever since, a make-up artist is a key person in all serious presidential candidates' staff.
And as far as presidential speeches, I think we all know that most presidential speeches are written by speech writers, not our beloved figure-head. Clinton tried to pretend he wrote one of his more important anti-impeachment speeches, but even this one, though the finished copy was done in Clinton's hand writing, was actually written by Dick Morris.
Both the news and presidential speeches are read to us by figure-heads, but written and crafted for other purposes behind the scenes by others with their own agenda.
I believe it was Thai Gold a day or two ago who posted the prediction that things wouldn't change by predicting the price of gold Friday and Tuesday. He used the same figure for both days.
That's because Ronald McDonald has more to do with what's on your Big Mac than President XXX has on what happens in this country. Neither Dan Rather nor "Dubya" are what they appear.
I'm not pining away for AlGore, mind you - - - he makes me queasy.
A wave of silence engulfs the hall as both sides stop and turn on this new, mutual, enemy.
If any of you can see even the slightest trace in Bush of - sincerity, honesty, a man of principle, a man who will be a true leader, and put forward an agenda that is first and foremost one that is for the general good of, not only America, but for the 'free world' (whatever that means) that that country so often claims to lead, then go and get an eye test ASP.
He's as slimy as all the rest - his face tells you, his body language tells you - and soon his actions will tell you. You won't have long to wait, once his feet are under the table. Allow a little time for him to throw a few �sweeteners� at the crowd, then watch out�����
Those who really run the US will always ensure that whoever takes that high office will be one who puts forward 'their' agenda, and if he/she doesn't he/she will not be around long enough to give the customary farewell address. Now YOU may decline to believe this, but the man who is in that chair knows it, you'd better believe it.
Talking about farewell addresses. I happened to have the TV news on as Clinton was giving his. I just heard the closing �thank yous� to all and sundry. One I liked for its honesty was his thank you to the American voters for having giving him the opportunity of - the �ride of his life�. He has such wonderful turns of phrase. I am sure Monica was listening and felt elevated. ( I'll bet it wasn't missed by Hillary either).
RE:. Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
I don't know about the erudition, but I suspect we will have "More of the same". To wit I quote Al Fulchino's recent post (again): "We calculate all manner of means to understand why gold is not valued higher, when it will go higher etc. Waste of time. Total waste of time. True value of sound money is not a supply and demand issue it is and always has been an honesty issue."
The criteria of the contest states: "We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion."
This overlooks the "Moral" scenario from which the economic, political, and financial scenarios extend. While there is some hope that the new administration is, at least relatively, more honest than the previous administration (hard to imagine otherwise), I don't hold much hope for the power system at large in Washington realizing the error of their ways and so I expect it will be business as usual which means "More of the same" for the outlook going forward.
"Statesmen...may plan and speculate for Liberty, but it is religion and morality alone, which can establish the principles upon which Freedom can securely stand." --John Adams
And so this leads me to the second part of the contest to guess the price of gold for the February contract at the close Friday, January 26, 2001.
I wouldn't be surprised to see it at $264.90 as this seems to be within the acceptable, allowable range for gold.
And now for a timely quotation... "The free market requires men and women whose word can be trusted and who have formed personal traits of self-discipline, prudence, and self-denial or the deferment of gratifications. Smaller government requires many of the same qualities so that individuals will not constantly turn to a powerful state to offer them complete security and a cornucopia of favors bought with other people's money." --Robert Bork
I'll straighten this out!! @ALL Bush supporters & ALL Gore supportersDear Poor Journeyman,
Nice try, but that wasn't even mildly irksome! Your heart is in the right place, but this is too large a scism to paper over. And on a site that largely promotes a uniform conservative view of money no less!
Problem is --- there's no problem, only a reasonable dialog between reasonable people. I find PH in LA to be an exceedingly rational person, even though we agree on little. I make fun of his convictions {near convicts} and he makes fun of mine, I'm OK- he's OK! Not much either of us can say will change the other's beliefs, and at some point the interchange becomes totally pointless as far trying to convince each other. However, it is quite healthy {this is your therapist talking now} to have this outlet of expression. There are much worse ways to settle disputes, including ignoring them!
Thanks for trying JMan, but that was total amateur hour with insults. This place may indeed need your "scapegoat" so I am going to go to work on the supreme acts of INSOLENCE so as to personally take all the heat as you propose. Wish me luck! Stay tuned!
Yes - so it would seem. Having had little use for his father as president, seeing the same faces surrounding our newest father figure, I can't say I'm terribly excited about our chances of ditching the current corporate fascism.
Just so there is no confusion;
fascism - a governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism. - Webster's unabridged.
Given the above, the old boy network seems to be alive and well. We seem to be attempting to delude ourselves into believing that "this time, it's different". I'll concede I remain in the camp of the skeptics.
Of course, when Monday comes around and we see the hand of control lifted from the gold market, you may be able to convince me that it is indeed different. At least I'll only have to wait until Monday to find out.
Apperantly CNN did a small piece on the "Masonic" bible that GWB wanted to use in his swearing in (same one as GWashington and his dad GHWB), anything significant in this? Or is it just a nostalgic(?) touch?
Maybe GWB gets to job of being around when the NWO implodes the US $/economy so as to humble the US nation into submission and world government? They could let gold go sky high (since they control most of it anyway) and allow truth to do some of their dirty work? There is more than one way to accomplish the NWO.
Let's see... George blubbers on camera about "civility, courage, compassion and character" and you want us to buy it lock, stock and barrel.
Well, for me crying (or braying, prating, etc.) about something is not the same thing at all as doing (or having) it. What is so "compassionate" about cutting the review of death penalty cases from 30 minutes (the time his predecessor governor allocated) to 15 minutes before routinely denying every single petition for clemency during his term as governor? And making mocking faces about a woman's appeal for clemency on the grounds that she had become rehabilitated while in prison?
Where's the beef, man? Where is all this "civility"? Where is all this "courage"? We know about the compassion, already, thank you very much. We also know about the "character" of a guy who finally quit drinking just 11 years ago. Who got himself arrested for Driving Under the Influence (DUI) first.
George can tear up all he wants (with or without his acting coach) while he mouths empty platitudes. Until I see some of this "civility, courage, compassion and character" I'm not even going to give you the benefit of the doubt. Not after we watched his power grab in Florida.
"Just what is (my) cause here?" you ask? And then hop right up on your soapbox about "slashed tires on some automobiles when security checks slowed their entrance to a designated protest zone"?
Yeah. I guess you're right. Those "protesters" sure are out of line, aren't they? Being outside of their "designated protest zone" and all. I mean, with all those "wrong/bad/etc. opinions of theirs, they sure don't have any right to express them unless they're inside their own "protest zone", now do they?
You just can't understand anything except self-interest, can you? What's my cause here?
It embarasses me to even have to say it, but I will. Even if Lady Leigh wants to call me more names. My cause is not some tawdry government "program". Some self-inspired "benefit". Nope.
It's just what's right. It's doing the right thing just because it's right. It's holding the president to a very simple standard. Not the "civility" standard. Not the "couragous" standard. Not the "compassion" standard. Not the the "character" standard. I'm not impressed at all by those words. I don't care about George Dubya's self-proclaimed virtues. I just want him to do what's right. It's not right to dispense with counting of ballots just because you're ahead at the time. First you count the votes. However you have to do it to get it right. If you're not willing to do that, it doesn't matter how civil, or how compassionate or how couragous you think you are.
As a citizen of this great country, I just don't care about George Dubya's personal opinions about himself. I do care about what's right for every one of my fellow Americans, and about what's right for every single member of the human race.
This forum is a welcome sight to my eyes! The posts are inciteful, hopeful, and give solace to one who has been laughed at for years for preaching the necessity of Au for retirement.
I look forward to learning much about the Au community.
WAAAAAHHHHOOOOOOOOO!!!!! Now please send me that beautiful hunk of Ag!!!!!!!!! WAAAAHHHHOOOOOOOO!!!!!
GWB Swearing InHopefully GWB used the "Masonic Bible" {have no real knowledge of what this actually is, but an acute general understanding} out of tradition, nostalgia, and ignorance{?}. The following is a blurb from CNN:"In symbolic and substantive ways, the two Bush presidencies share common starting ground, each coming to power after long periods of economic growth. They both chose to take their oaths with hands on the same Bible used by George Washington. Chief Justice William Rehnquist administered the presidential oath to the elder Bush; Rehnquist will do it again on Saturday."
Answer From Friend Jeeves"Sacred Texts: The Bible is the "Volume of Sacred Law" of most Western Lodges. It is one of the three objects comprising "The Three Great Lights," the most common and important Masonic symbol, which must be displayed while Lodges meet. The other objects are the compass and the square, and the sacred volume, which does not have to be the Bible. It may be whatever scripture is revered by the members of the Lodge (Hamil, 151}." END
So a "Masonic Bible" is the standard Bible somehow labeled with Masonic inscriptions. Of course GHWB has strong ties of same. GWB is a "renewed spirit".
Best to the explorers of all types!
Oh how I wish those halcyon days were back when I had my parents to support me. Alas..........
Adults? I don't think I cast doubts on, or reference to their age, did I?
But I think I know what you are trying to say, and if I am right then if you believe that, you probably also believe in Santa Claus and the Tooth Fairy et al.
Will Bush be good or bad for gold? Neither. He has no control over gold's destiny. He will be used by the people who have, yes, but then so would anyone else in that chair.
Gold will not rise with any noticeable appreciation until the Euro is FIRM on its feet
ALERT!To all who watched the inauguration ceremony: Did anyone else see the point where GWB was quite teary eyed and turned to his left and spoke a few short words to his Father? Being the endless curious sort, and having taped this momentous occasion, I decided to show the tape to my neighbor who is expert at reading lips for her interpretation. The results were quite astonishing and thus this scoop:
The words he spoke were; "I cannot wait to end this gold buggery by the ESF". One would think that this man had other important things to think about at such an occasion, but this must be his highest priority. I'm gonna see if I can get that 125% home equity loan and stock up on precious ASAP! No guts-no glory,Christopher. Stay tuned, we are now following his every whisper.
Laura may be a librarian and look the perfect lady, but the things she is saying about Hill, frankly, make me blush. I'm a Rodham fan in comparison!
Yes, this IS a very intellectual site, but an off-day every now and then never hurts.
Best to everyone-even the Californians.
Got Ears, Gold, GATA?
I think its time for everyone to get off their political soap boxs and get this Forum back to the subject its well known for GOLD!If you want torant and rave do it some where else ,Let us fish in the deep end of the Gene pool not the shallow end. The election,inaugration etc. is over Thank God!Stick a fork in it Its done .
@PandagoldI may be wrong but this guy BWB might be different. Time will tell. And Yes! If as I believe he has his own agenda, he has better to watch his back. I hope he keeps in mind what happened to Kennedy and organizes in consequence.
Would like the name of one individual who had their private stash of GOLD taken away from them in the 1930's under FRANKLIN D. My grandfather HUBERT PERSOHN kept his entire stash of GOLD! He refused to be intimidated! But then again HUBERT was a also a moonshiner during PROHIBITION! HATED ROOSEVELT! HATED JOSEPH KENNEDY! And HUBERT was a Catholic!!! Go Figure!
Paul O'Neil confirms at hearing that the new administration favours the Rubin/Clinton strong dollar policy or words to that effect.Bingo bango;up goes the USDX,down goes the yield on the thirty year treasury.
Isn't that special;maybe if we all chant the strong dollar mantra together while clicking our heels,the magical aura of the new economy will keep the almighty dollar as the global behemoth it rightfully deserves to be.
Okay,I apologize for the sarcasm,it's just that it seems as if we've seen this movie before.Just how is it the dollar is so strong in light of a myriad of fundamental imbalances in the US economy?In addition,how is it that the capital flows of the world keep washing up on the shores in spite of these imbalances.
We all know we can rely upon the mainstream media to constantly remind us of the positive attributes of the US economy of which there are many.But what of the negatives lurking just behind the shimmering neon facade(when the power grid is working).
I am always interested what economists have to say when they attempt to discern the future of the US economy and of course,the direction of the US equity and bond markets.Lately,it seems most of them are singing from the same song book.Slowdown but not recession;then Mr. Greenspan's rate cuts will prove to be the panacea for what ails,which will result in economic strength and a rising market in the second half.
How can these people turn their backs on imbalances and inequities that are so obvious to anybody with a little doubt and the ability to do a little quick research of the fundamentals of the issue?How can they ignore historical precedent?What of a ratio of current account deficit to GDP of 4.5%, which is trending relentlessly to levels never seen before in recorded history?
If any of these economists touch briefly on these issues, it always seems to be regarded as a trivial matter that will be dealt with in due time.In my opinion the US does not make the strong dollar policy,it has to be the foreign creditors.Wn you are borrowing a billion and a half dollars a day from foreign creditors to purchase more"stuff" as well as pay your accumulated interest bill,you would think this issue would generate a little more concern.Or maybe it really is a non-issue.
Is the strong dollar the result of an open market oriented economy relatively free of governmental interference and regulation,or is there more to the story?Will the creditors of the world continue to be placated with exploding M3 growth,hedonic adjustments to GDP,core and non-core CPI, surprise rate cuts and monetary crisis that always seem to happen to the hapless other guy?You know,the one with the crony capitalism or the structural barriers in his economy.
Time will tell.Now back to our regularly scheduled programming.
From ORO (#45935), "At current prices of silver and current prices of electricity, some high power short runs might be replaceable with silver or silver-copper lines..."
ORO, can you elaborate on this or refer me to any other information? I can't help but think that something may be stirring with silver prices rising, silver lease rates up and I just today (on GE forum) saw a good sized list of silver mining stocks that had tremendous gains last week.
If the price of providing electric power reaches the point of justifying new wiring made from a silver-copper alloy, even if only in generators, transformers and, as you suggested, short runs, then a new industrial use for silver may be created that will dwarf the photography use.
It may seem expensive but it's a one time installation cost that saves X% of power every day after installation. Maybe it's not so far-fetched. Lord knows there will be construction in the production and transmittion of power soon and for years to come OR we'll all be in the dark. At least in the new construction, why not use what works best. (It may be that tax money pays for much of this in which case, costs will overrun all estimates anyway)
For whatever reason, if POS gains enough, gold will follow and once POG starts, short covering will spike it along. None of this intended as investment advice- it's just a thought.
Rich
PH in LA (1/20/2001; 14:42:01MT - usagold.com msg#: 46009)
Just a quick line froma borrowed keyboard:
Is your cause only the counting of the votes?
Based on all the data, I would say you have a case of "Don't confuse me with the facts, my mind's made up."
One more time: Is there somthing you felt we would benifit from with a gore ticket, or are you just consumed with hatred for President Bush?
BTW, any killer can get themselves into a state of rehabilitation when faced with the death penalty. It sure as heck doesn't rehabilitate the victim or their family. You were talking about the axe murderer, yes?
Does the theory hold water......?There have been several mentions of late of the possibility of a copper / silver alloy being used for the increased efficiency of electrical conduits. However, there are some basic flaws in such ideas.
Although pure copper and pure silver are both at the upper end of the relative conductivity scale, with annealed copper having a value of 100 and silver a value of 108, the problem lies in alloying dissimilar metals. In most cases, alloying two dissimilar non-ferrous metals actually results in a LOWER average relative conductivity than either of the constituents in its pure state. In other words, alloying pure copper and pure silver, depending on the percentage of each, could actually result in an alloy falling somewhere in the 70 � 90 range on the relative scale, far below either copper or silver in its pure state.
Tests done several years back using gold alloys showed that the metal in it's pure state fell far higher on the relative conductivity scale than when it was alloyed with any other metal. Separate tests using both silver and copper as alloying constituents showed that the higher the percentage of alloying metal added to the gold, the lower the relative conductivity of the resulting alloy, until the point of a 50 / 50 mix of the metals, at which time the conductivity value began to rise back to the level of the alloying metal as the percentage of gold was reduced from 50% back to the alloy metals pure state.
To make matters worse, the temperature of the metal is also a determining factor in its relative conductivity value, and pure lead at a low enough temperature can actually become a "superconductor", with a resistivity factor nearing zero (resistivity being the reciprocal of conductivity).
So while silver in it's pure state would offer some added conductivity value over pure copper, it is doubtful that an alloy of the two would result in even the basic value of the pure copper alone. Whether pure silver for such uses would even be economical in most cases might be the real determining factor.
You are correct ,and you said it better than I.The metal is very political ,my reference was to all the petty bickering going on with Bush/Gore.Back to yhe trail where I await the next hike.
Fascism, 20th-century form of totalitarian dictatorship that sought to create a viable society by strict regimentation of national and "individual lives" (my emphasis); conflicting interests would be adjusted by total subordination to the service of the state and unquestioning loyalty to its leader.
Fascism emphasized nationalism, but its appeal was international. It flourished between 1919 and 1945 in several countries, mainly Italy, Germany, Spain, and Japan. Fascist regimes also existed for varying lengths of time in Austria, Poland, Bulgaria, Greece, Portugal, Romania, Hungary, Finland, Norway, and Argentina. Even such liberal democracies as France and England had important Fascist movements. (Encarta)
***************
And encyclopedias aren't a lot better. When ONE has to watch what ONE does or says in relation to ONEs (pun intended), THEN ONE can start defining ones political environment in terms of fascism.
It may sound like hair splitting, but is not.
At best, the US government has more oligarchical traits than fascist. All is but a stage in the political evolution (or is that devolution?) of a state - and one is wise to remember that democracy is not a state of being, but rather a process. As a process, it is attacked from all sides by vested interests that would wish to make it less than what it should be. A democracy can be left of centre or right of centre - and still be a democracy, if the process is allowed to function without interference and retain its full connection to the will of the electorate. Remember, Marx was a democrat (small "d")(smile). He did not envisage Soviet Union communism.
It's Getting LateOK, you want some gold discussion? It's time to re-read a Classic from just 3 months ago. Prophetic!
FOA (10/20/00; 14:00:07MD - usagold.com msg#43)
A Fireside Chat
Let's settle by the outdoor hearth for heat and conversation. I even see Michael Kosares back there with a warm cup. The fire is aglow,,,,,, the talk is about the trail before us:
Aristotle, said this today:
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Aristotle (10/19/2000; 5:44:45MT - usagold.com msg#: 39386)
Do you heed your own advice? Thoughts on Trade deficits--big and small
"""""As for the U.S., we are in a unique but temporary position in which we haven't yet had to pay the full price for our past trade deficits. Until that day arrives (with severe currency devaluation), we might be inclined to stand the old terms on their heads and describe our current trade deficit as a FAVORABLE trade position because we are receiving real goods and services from other countries with partial payment (required in excess of our own exports) made in typically depreciating paper of our own easy creation.""""""
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Aristotle,
In this post you also made another very good point (see full post) by directing Hard Money Advocates to pursue their own often stated doctrine. I think that perception is a given; that when the crisis hits, everyone the world over will be buying gold for depreciating dollars! Indeed, if your Chimps, Champs and Chumps (see his #39302 on the main forum for definitions) are really forward thinking, they would be wise to follow their own strategy by buying physical gold now. Before the winds blow?
Further to ALL:
Following on Aristotle's above:
The dollar deficit is truly the main money destruction tool being forced to function in our modern "killing fields" of today! In the past we saw this trade deficit function operate for only short periods as it constricted growth in our US economy! Now, they have not only the US economy but also it's currency caught permanently in this long term trap. For the first time since we left the gold standard while making them play by our rules, they now have us. Once before, in 1985 (look at a dollar chart then) we were well on our way to the same problems, but the difference then was that "noone" had a potential alternative reserve currency system to run to when we induced a recession. Today they do and this "waiting in the wings system" is the hatchet tool in the hands of our world markets that will do us in. As the ECB says;
""" it's not the Euro is too low, your dollar is too high ,,,,,,,, so go ahead, make my day and fix it"""! (smile)
Indeed, no intervention by the US now is a stab in the heart of the dollar economy.
The US has had the rest of the world in somewhat of a trap also. For a long, long time. Perhaps from when we told them that the world gold exchange standard bearer would no longer ship gold for dollars. From that point on we (USA, my country) could inflate our money without consequences.
In fact, we had to inflate in this "Darwin" fashion over all these years! Truly, if we did not inflate long term and ship liquidity (created dollars) outside the US, our dollar's value would always soar above other strong currencies. This is because of it's world settlement function. Notice I said soar over their value instead of they would fall away from our value. There is a difference. As in our recent hikes, we saw that the internal basket of goods prices for both dollars and Euros dictated that these currencies are at opposite extremes in value and should reverse. Further; I use Darwin because everyone came to think that our sending money overseas was part of the "natural order of things" (chimps (smile)). They thought and still do think that the world just craves our money! They will have a different opinion later.
We must reconcile with the truth of this process by looking at the dollar world from 1971; the one time the dollar soared too high for too long it began killing off our economy. Forcing us into the same printing policy other lesser nations must employ to keep their exchange rate level. Yes, even the USA must sell overseas to create jobs and profits at home. A huge trade deficit in a reserve currency nation, induced by an overvalued currency like we are seeing now, raises the currency's value even further above other strong fiats. This is the way such a reserve system naturally reacts when there is no local reduction in liquidity to check it.
A regular (non reserve currency) nation's money would suffer a different fate if they inflated the native currency the way we do. It's non trade settlement function begets a falling exchange rate. That in turn drives then into the same policy of hyper inflation but it's effects are felt in higher prices, immediately.
Again, conversely, a reserve currency always rises in exchange function from this forced "liquidity draining" trade settlement. Once on this trend, over time, the higher it's value goes the more people finance in other mediums (yen carry, gold carry, Euro carry, oil carry) This further dries up the fractional reserve created dollar reserves as the demand for dollars grows ever stronger from it's ever higher cost trade settlements. Settlements dictated because IMF / dollar protocols demand dollar use as settlement.
In the past if the system began driving the dollar too high and forcing US trade deficits, the Fed would raise rates to throw us (USA) into an economic recession that broke the vicious deficit trade cycle. Knowing full well that it would be a short recession policy because "noone" would jump the dollar ship before the medicine could work. Looking around back then and we see there was no other reserve currency ship to jump to. We either lose jobs and profits from an "overvalued currency" or from an induced recession. The first can lead to a financial breakdown, the lasts corrects things after only a short while. Naturally, we embark on the quick fix of a fast recession.
This is why our times are so very different now. What the "chimps" came to know over this 20+ year period as a strong America in a high dollar, was always something our money creators were striving to fight against. We truly have always been inflating our currency for these many years in a attempt to keep the natural effects of the IMF reserve system from spiking the currency too high up. Again, if we had a regular currency, our policies would have been reflected in sky high prices for everything. What most of us "smart chimps" know as price inflation reflecting money supply inflation.
OK, let me sip some starbuck's:
Ever since the Euro was seen in by US policy makers as an eventual success, our treasury has tried to put it's best "New York Spin" on the ongoing process. Simply stated; from the early to mid 90s we are in favor of a strong dollar policy. In reality, with the advent of the Euro and the evolving stance of the BIS, this has made our "economy killing" strong dollar unavoidable.
There is no way the Fed can create a new recession now without everyone jumping ship for another currency reserve. There is no possible way the Euro Zone will suffer as big a downfall as the US in another policy induced recession. Just looking at their closed economy and debt structure tells that story by itself. Any US slowdown means a run for the Euro, yet weakness in the Euro means the US must inflate at a torrid rate. We now stand toe to toe and wait to see who will fall first. All the while our world dollar gold markets are caught in the cross fire!
This is where we have been for the last decade. This explains why the DOW and all it's paper cousins have enjoyed the effects of a massive, ongoing dollar expansion worldwide without any official policy interference. Right when we were to the point of changing policy to slow things down, the Euro was to be introduced in a year or two and risked taking away or sharing the dollar's standard.
The "lesser chimps", lost in Western thought keep waiting for the fed to induce their deflationary policy. (I was monkey - ing around in this area for a while myself) (grin) It is not coming. To do so now would commit the dollar to non reserve status in a hurry and produce a massive price inflation at home (right now) as all these unneeded dollar reserves come racing home. Remember, the ECB does not need dollar reserves! The Euro is a stand alone currency representing an in house trading block. They may have to buy dollars for oil, but others must also buy Euros for European produced goods. If the Euro went to .10 to the dollar the EuroZone economy would not stop. But all international dollar trade would grind to a halt. The USA could not sell anything internationally, at all! Every other nation would simply abandon the IMF protocols and use their native currencies to trade directly with Europe. Even Arabia would break their SDR basket peg and trade oil for Euro goods, either using their currency or directly if needed.
Our outdoor fireplace is getting hot, lets step away.
The lesser of the two evils today (and this is the one the ECB / BIS enjoys watching) is our current frozen policy. We can no longer cut off the strong dollar / growing deficit circle by raising rates and invoking a recession as in the past. This time we must continue to pump the reserves at all costs in a process that only floods the world with more dollars. It's called a currency hyperinflation and is one we (as US people) have never witnessed in modern times. The pressure has built up full volume now as all escape valves are being closed. We are well on the way to a derivatives exploding event that will break into the open with a cascading dollar and full force US price inflation.
This is the "why" for the gold derivatives policy that Physical Gold Advocates are now enjoying. Also one that leveraged paper gold investors are being tortured with. In effect, we "gold buyers" are trading 1971 style dollar derivatives contracts for the physical gold we never could get then. And doing so before a 1971 style gold event that comes in the form of a denouncement of the contractual viability of all gold contracts. Let's call it "no gold for dollar derivatives"!
All the while, just like in 71 other "chUmps" (smile) are saving these same paper gold substitutes to protect themselves from this same crisis.
Further; many of them have sold their physical gold for use by the BBs. I think SteveH calls it OPG (other peoples gold). This is where the real supply that fills a Physical Gold Advocate nation's coffers (and mine) comes from. It's truly a good deal in light of what's coming. Let's not mess it up by talking about who is buying all that gold, rather just point everyone to watch how much is being sold!
The US cannot walk away from hiking our ""gold trail"" now. Because "this process" is one of the few tools available to them for keeping the dollar perception in a good light. In effect by slowing the currency transition process they are doing exactly what world dollar holders need the to do. They will inflate these derivatives until in effect; our modern gold market bankrupts itself as supply is exhausted. I say, good! (smile) But once we get to that stage, I expect that a super US economic downturn will ensue. Then the fed will go wide open and cover everything in sight to keep us going! The ongoing price inflation will be driving everything from physical gold to real estate through the roof.
I submit that many smart hard money thinkers like Traveler and Thai Gold (and many others) are walking forward but looking backward. I (myself) have tried this before but usually run into something I didn't see in front of me (smile). That something today, for modern hard money followers is in the form of an internationally induced transition away from the US dollar as a reserve currency. Such a policy evolution has the effects of driving the lead currency's creator into printing press mode as an only option to maintaining the viability of our economic and financial structures.
Yes, it eventually breaks everything! But this is nothing new for us gold history buffs and it's what has happen in countless modern national fiats around the world today. Nations that don't have a reserve currency to play with. We will do like their citizens do, continue to use dollars but carry in our pockets whatever new reserve is in fashion, as a backup! Be it gold or Euros or both. In addition, our entire financial structure (like in these other nations) will change to operating in an inflation economy. Money will be lost, big time and made big time, but things will still be financed, brought and sold. Houses will double, triple then double again in price, even as financing rates approach 35%, 40% or whatever. We will also follow the (then) prevailing world policy concerning physical gold, solely because it will make economic sense to our officials.
As such; like today, everyone uses dollar reserves because it keeps us within accepted international policy. Across the currency warfare valley our "gold trail" is coming to, we will also use gold as a free reserve medium. Mostly because it's what the leading reserve policy of that time will dictate and that will keep us on good trading terms.
No, we will not confiscate gold again. Perhaps if it is designated as US legal tender and caught up in some kind of currency change, that will pose a risk! But that's just following the same fiat rollovers so many other countries now must employ and will have little impact on most gold owners. Besides, PGA's know how to avoid such a trap through physical gold ownership diversity! US Eagles held along with a diverse group of new and old coins fit my pocket just fine. I don't worry about the premium on any ounces I buy today. In the future, the total price we now pay will probably be the premium anyway (huge smile from ear to ear!)
Again, as international trends follow the use of physical gold into the free trading asset realm, no longer as an official money, then it's value and ownership will soar the world over. To date this is the future before us as the dollar fails it's function.
Truly, a relationship with an honest international physical gold dealer will no doubt place oneself at the center of this exciting new financial evolution. (I'm trying to think of a dealer that would fit that description? I know I just saw one on this page. Somewhere?) (smile)
Lastly:
Don't tell me an inflating dollar economy doesn't work this way! I have lived in many, many lands and have witnessed and used such inflating systems. Look around for yourself at how non reserve moneys are impacted by their native policy today and the effects of those policies on all real assets. There are few examples that do not follow this regular fiat price inflation mode. Our dollar use and function is about to revert to a lesser more common level, suffering it's drop away from reserve need. In doing so it will change as never before in our time. In fact, it's only the current gold pricing system that may experience a larger change. Not only in use but in Western gold value perception.
""""We watch this new gold market together, yes?""""""
Thank you one and all for sharing this time
Trail Guide
Very perceptive glib comments from your borrowed keyboard.
All right, so my mind is made up... but I sure hope you don't think you have presented any facts to try and confuse me with. Nor has Al Fulchino, with his yearning for a "father figure", either.
No, I don't pretend that Gore ever had such an overwhelming program that would have been of such great benefit to you or to the country. But then, I'm not waging a self-interested campaign for my own benefit, either. And no, I'm not consumed with hatred for Bush, or anyone else around here. (And that includes the noble Lady Leigh and her name-calling, too.)
However, when it comes to a national leader, I don't think of him as just another one of the guys, to either love or hate. No, I expect a lot more from a leader than I do of just another drinker down at the bar. The president has to officially do what's right. His office is not called the Executive Branch for nothing. His place in the cosmos is to execute the laws that are passed by Congress and approved by the Supreme Court. If he acts like just another guy looking out for number one, who's going to do what the constitution demands?
Now who should be calling the shots here?
Why the voters, that's who. That's why we have elections. But if the votes don't get counted to everyone's satisfaction, what legitimacy does an official have, anyway? Does the fact that his father used to be a president give some special legitimacy to a candidate? Not in my book, it doesn't. A legitimate president has to get more votes than anyone else. That's all. Nothing more. Nothing less. If G. Dubya can't understand that, he shouldn't have stood up and run for president in the first place.
And one more thing.
The shabby treatment of our last president that was served up by the Republican party cannot be overlooked nor forgiven. It should never have been rewarded by bestowal of the Presidency on one of its members. That whole impeachment spectacle has left many in our country with a distaste that can never be forgiven nor forgotten. Far from personal hatred for any member of the Bush family (although I do find them all professionally detestable) I can truthfully say that I will never, ever vote for a Republican candidate for any office whatsoever, if based solely on the Republican conduct and outright sleazy behavior they exhibited during their trumped-up, absurd impeachment process.
No. My "cause" is not just the counting of votes.
It is also the "out of the loop... read my lips... let's not let this election be decided in the courts..." crap that we have heard all along from the various President and Non-president Bushes that we have had to endure on TV every night. These guys are completely arrogant. They have demonstrated that they think they can just say anything, and we peons will have no choice but to obey. My forefathers fought a revolution to be rid of that kind of treatment. And here it is, right back again. And you ask me if I am consumed with hatred...? I do hate and detest that kind of behavior. And that whole way of thinking, too.
I don't expect anything but more of the same from this guy going forward, either. But I don't have to just shut up and swallow it without comment, either.
I come from the camp that believes the dollar/gold relationship is the key. I don't expect the metal to rise unless the dollar is perceived as having lost its credibility as a wealth retention asset. Physical gold demand will not overwhelm the paper market unless it becomes obvious to all that the buck is in trouble in its ability to hold purchasing power better than other currencies.
What signs might we look for to indicate this is taking place?
I would say first of all the world perceives the dollar's strength as being tied to the US economy's strength. Are we not seeing signs of weakness all about? The Fed is pumping money at unheard of rates ($176B in 7 weeks), new layoffs are announced daily, the corporate credit market is in shambles, credit quality at the consumer level is reaching new depths, and businesses are folding at an ever increasing pace. The quickness of this decline is likely a direct function of the leverage in the marketplace. Unless we see some kind of quick fix in the credit markets, I fail to see how a recession/depression will be avoided in the US.
Second, the dollar's strength also lies in its reserve currency status. For the first time in its history as the world's reserve currency, the dollar faces credible competition in the Euro. In other words, investment has somewhere else to go.
Third, the dollar is now suffering from obvious inflation. The banks/government have been masterful at convincing people that inflation hasn't been a problem, but it is becoming apparent to anyone that prices are on the rise, especially energy and food. My favorite indicator, the McDonald's #1 Meal, is trading at a new high of $3.49 this week here in Kansas. Watch out when we break the psychologically important $3.99 level! Even eight-year-old's will have figured out the situation.
It's starting to look like this will be gold's year. Gold's price will likely hinge on whether the stock market can be revived. Considering the profit picture, I cannot see stocks rallying to any great degree. As soon as stocks resume their plunge I would expect the dollar to collapse versus the Euro and Swiss franc, finally freeing gold. People in the US will be looking for some safe haven and will likely turn to gold. We are even hearing talk in the financial media of all places.
Unfortunately for them, physical will be very difficult to come by. I suspect the futures markets will be unable to deliver making physical even more difficult to get their hands on. Obtaining a realistic market price for physical might take some time as the futures would be forced to settle in cash. Physical might be unavailable at any price initially as holders attempt to ascertain the level of currency inflation having already taken place. At any rate, higher prices for physical would seem assured.
I suspect we will see this happen sooner rather than later in the year. Credit markets are in great distress. Attempts at reflation so far have not worked and it is unlikely enough new credit could be implemented to offset the level of malinvestment having already taken residence in the economy. There does come a time when somebody will take a loss. I'm betting the time is near.
Thanks for trying to get us back on course. Really, I do not understand why so many people cannot understand that message. I suppose because of the nature of it as well as a cynical outlook on internet chatting. Nevertheless, I do understand and do think much of what TG forecasts will see fruition. Let's face it: nobody can be 100% right. However, even if he is half right, look out!
Hey Galearis - thanks for the response. We are in agreement concerning Webster's. However, it is a good place to start.
You wrote in part;
"At best, the US government has more oligarchical traits than fascist. All is but a stage in the political evolution (or is that
devolution?) of a state - and one is wise to remember that democracy is not a state of being, but rather a process. As a
process, it is attacked from all sides by vested interests that would wish to make it less than what it should be. A
democracy can be left of centre or right of centre - and still be a democracy, if the process is allowed to function without
interference and retain its full connection to the will of the electorate. Remember, Marx was a democrat (small
"d")(smile). He did not envisage Soviet Union communism."
Yes - what you say is correct if your assumption that the US government is functioning as a democracy or representative republic is correct. I would disagree that this is the case. The US government seems to be controlled and has been for quite some time by banking interests. We are led to believe our votes count, etc., but there seems to be little evidence that those we elect represent those that elect them. It would seem the banking interests purchased this government at least 90 years ago or so and haven't relinquished control to the masses that I've been able to determine. This government seems to be a corporate/banking dictatorship controlling commerce, social policy, and above all monetary policy. We are led to worship the Fed as our economic God and the presidency as some sort of God over our everyday lives protecting us from any harm via state intervention of one sort or another. I'm afraid this "democracy" is only illusionary and these "gods" will fail those that misplace their faith. The whole thing smells of fascism to me.
The dungeon gave me five minutes of sunlight per day
All quotes from a tiny book, put out my Wallbuilders, called The Second Ammendment, by David Barton. It is a great little book that seems to sum up well, a lot of other sources I have seen.
This is not meant for the Hall.
Thanks Steve H, I found much, do to your diligence.
My post.
There is no doubt in my mind, that there are certain principles that exist for us all to witness. Mathematicians use slide rules that can measure them. Chemists have litmus paper that can affirm their presence. Seafarers have their compass. If we follow them, we can calculate. We can determine contents. And find our way. If we are humble enough to realize that we cannot invent principles we can profit, learn and be guided in life. And also be inspired by their awesome beauty if we have little in the way of our own ego. This inspiration is actually love and respect.
In our life, we are witnesses to the constant battle of whether people, ourselves, our family friends and the country and world, shall utilize these principles. Or avoid them. The battle is between right and wrong, bright ideas and not so bright ideas (right ET?), and good and evil. Principles come from somewhere. A benevolent Father in heaven perhaps. Maybe just an orderly progression of evolution. Some of you know what I believe. And the opposite of this has to be confusion. Where does this come from? Perhaps we simply exist in a state of random development. In control of nothing, we plod along hoping for a good day to come our way. Sounds a bit depressing doesn't it? But truly these are the two opposites. Principles and the lack of them which encompass confusion in our lives and that of events. Where this comes from I will leave up for your thoughts.
In the universe we walk. We gaze outwards from our intellect and perhaps some of us think we gaze outwards from our souls. We take note. We absorb and ponder what we witness. Can we be just animal? One thing separates us. We can make a choices based on information that is intuitive. We can be a conduit. We can tell our hand to take something in a store that we did not pay for. We can hold it back. Why? Certainly if you put a hamburger in front of my dog, he will eat it. If you tell him it was stolen, will he be able to tell the difference? To make a choice? Some out there will debate me on this. That animals have souls etc. I am not interested in them. They are lost and to debate them is pointless. They have lost their way and need to be drugged with their drug of choice, cigarettes, drink, drugs medicine, lottery tickets, even books. But why have they? Why have so many among us chosen to avoid the principles that they see? Why have they made up fantasies? Created their own realities? Such as animals are like us. Or there is extra-terrestrial life. Re-incarnation. And we come back again and again after we die. Seems funny doesn't it? We laugh at some of the things that people do. We laugh because it can be so outrageous
But these are so obvious. How does it all start? Are there various degrees in between this adherence to principles and confusion?
Now we are digging deeper. So take a moment from your trail walk and sit with me a moment. Let us stop and see what we can witness, if we choose to be impartial. If we choose to be humble enough to not let ourselves think we can ever re-invent the wheel. A tool that was never really invented at all. Afterall, didn't the first person that possessed a wheel really just utilize raw materials in a way that supported the principle of a wheel? He was just a gatherer of creation, who saw. Who saw truth on earth and spoke of what he saw, which he translated.
So, let us witness. This is a gold forum and gold as well as firearms are often talked about. Our forefathers said a few curious things about firearms. Listen for yourself. Afterall, you have your own mind. You yourself are a conduit. You yourself can adhere or not to principles if you choose. Listen to what was written in some State Constitutions by the Founding Fathers of our Country and our States, and in other works of the day.
"Through Divine Goodness, all men have, by nature, the rights of�enjoying and defending life liberty [and]of acquiring and protecting reputation and property." Preamble, Delaware State Constitution, 1792
"The right of the people to keep and bear arms shall not be infringed." 1877 Georgia Constitution art.1's 1,part 22
"The right of the citizens to bear arms in defense of themselves and the state shall not be questioned." From the Constitutions of the following States: Kentucky 1799, Missouri 1820,
PA 1790, South Dakota 1899, Vermont 1786,Washington 1889, Wyoming 1889
"The people have the right to bear arms for their security and defense." Idaho 1889,Kansas,1855, Utah 1895
There are so many more Constitutions to pull from. And if these are all correct, is it no wonder that the anti-gun people try to focus only on the US Constitution? Seems to be too much clarity in these State Constitutions as they were first put together.
Now, my friends, I ask you. Didn't our Founding Fathers live and endure in a day where they had political thought and consciousness? We have our own, why would that generation be any different? Did the fact that men wore knickers and wigs discredit them? Doubtful to you and I. Tell me if you will why you think their countrymen agreed with these and many other thoughts of theirs. Yet we today encounter so many that would not recognize their beliefs. Why? What is different about a person who sees what they see and one who disagrees with them? What is different about a person who believes in honest money and one who doesn't or at best is ignorant of what it even is? Same with abortion since that has reared its head here.
I predict that, when some of you read the words above, you gazed deeply. Time stood still for a moment. Why? Can it be that you recognize something? Can it be that your heart is like their hearts? Can it be that you recognized what the man, who put that first wheel together, realized? Can it be that you DO see that one plus one IS two? And Hillary Clinton and all the spoken word in the world against what you see will not shake you from your beliefs? Can it be that the political thought of today is no longer what it once was? And that you are rapidly becoming in the minority? What do you see? You answer for yourself. Can principle really be finding a home in fewer and fewer hearts?
In other places, we can see the more of what was proposed by the states themselves for the Second Ammendment.
New Hampshire's proposed wording was: "Congress shall never disarm any citizen." From A History of the New Hampshire Convention, A.Walker page 51
The Massachusetts Convention proposed "[That} the said Constitution never be construed� to prevent the people of the United States, who are peaceable citizens, from keeping therir own arms." From Debates�.of Massachusetts, held in the Year 1788, p 86
What were these men and women smoking! All the Bill's and Hillary's, Al Gore's and university professors in the world can speak as the Scribes and Pharisees as far as I am concerned. Do you think they would recognize the words as being from our Founding Fathers or instead claim they are from those of some right wing fringe element? Did you ever notice that the Founding Fathers often mentioned good and evil and a Supreme being? Did they know and understand that evil and good need a conduit? Why would they need to even speak these words? I suspect strongly that they could see as many of you can see. In fact, listen to this from Alexander Hamilton:
"The Supreme Being gave existence to man, together with the means of preserving ang beautifying that existence. He�invested him [man} with an inviolable right to personal liberty and personal safety. " , The Farmer Refuted: Or, A More Impartial and Comprehensive View of the Dispute Between Great Britain and the Colonies, p6.
Circumstance called on men who could see with clarity. Do any of you ever hear Circumstance calling upon you? Are you a conduit? Are you void? What passes through your conduit today? What do you let pass in front of you?
Lastly, I offer some word from William Blackstone, a legal commentator of the 18th century.
"The right of the [citizens] that I shall at present mention is that of having arms for their defense. This is the natural right of resistance and self preservation when the sanctions of society and laws are found insufficient to restrain the violence of oppression�[T]o vindicate these rights when actually violated or attacked, the [citizens] are entitled, in the first place, to the regular administration and the free course of the course of justice in the courts of law: next, to the right of petitioning the [government] for redress of grievances: and lastly, to the right of having and using arms for self-preservation and defense."
And from James Wilson, who declared : Homicide is enjoined when it is necessary for the defense of one's person or house. It is the great natural law of self- preservation which, as we have seen, cannot be repealed or superseded or suspended by any human institution. This law, however is expressly recognized in the Constitution of Pennsylvania: "The right of the citizens to bear arms in the defense of themselves shall not be questioned." Works, Vol III, pp 84-85
What do you need? Social policy that makes you feel good? Friends? The love of another? Money? Social security? A safety net? No. What you search for is principle. Look no further than within. Within yourself, within a rock, within water and air around you. It is there for all who search. Be still and know�� BE still and know all that needs to be known.
Welcome to the
Home Page
of the women who
"saw the elephant"
-- the women of the
California Gold Rush.
"seeing the elephant"
To forty-niners and those following, no expression characterized the California gold rush more than the words "seeing the elephant." Those planning to travel west announced they were "going to see the elephant." Those turning back claimed they had seen the "elephant's tracks" or the "elephant's tail," and confessed they'd seen more than enough of the animal.
The expression predated the gold rush, arising from a tale current when circus parades first featured elephants. A farmer, so the story went, hearing that a circus was in town, loaded his wagon with vegetables for the market there. He had never seen an elephant and very much wished to. On the way to town he encountered the circus parade, led by an elephant. The farmer was thrilled. His horses, however, were terrified. Bolting, they overturned the wagon and ruined the vegetables. "I don't give a hang," the farmer said, "for I have seen the elephant."
For gold rushers, the elephant symbolized both the high cost of their endeavor -- the myriad possibilities for misfortune on the journey or in California -- and, like the farmer's circus elephant, an exotic sight, and unequaled experience, the adventure of a lifetime.
In reading your post: PG&E Responds to Secretary Richardson's Order, I am struck by the tone of desperation emanating from the utility. In particular the excerpt following is encapsulating of this: "because California's electricity crisis has pushed the utility to the brink of financial collapse, exhausting available cash and credit."
These guys are begging for some relief. What is striking to me is that it would be allowed to get this far.
As a Canadian, I grew into an awareness of the world with a certain awe of the power and sophistication of our American neighbors to the south. It is such a disconnect to me to see the nation that was the birthplace of such wonders as the transistor and its follow-on the microchip, could regress to the extent that ideological intransigence could precipitate such a potential calamity. How far your nation has fallen.
Sincerely hoping for a proper resolution of this mess, Shermag
I too recently had the opportunity to see your new President for the first time in an interview. It was last evening with Barbara Walters on 20/20. I had similar impressions to yours. He seemed to present himself with a sincerity, humility and self assuredness that led me to see him as likeable. In response to the question " What do you see as the impression that you will leave with the American people?" (if I recall the questiuon properly) He stated " I believe I will be seen as someone who is comfortable with who I am." He certainly left me with that very impression. He also did not to me ever indicate that he deserves any reputation as being a bit "slow" and "not so bright".
You are sounding like a pathetic bitter old man (aka a curmudgeon), and your rant against the Republicans is tired and redundant.
Why don't you follow the good advice of all your fellow Democrat heroes, who urged Americans to drop the issue of Mr. Clinton's abject irresponsibility and moral turpitude, and who succeeded in keeping the impeached criminal in office?
Mr. Bush is now your new president, we are starting with a clean slate, drop your ad nauseum rant about electoral malfeasance and all the rest of your childish complaints, because you owe it to the 50% of the nation that voted for Mr. Bush to put the recent elections behind you.
If you do not see the analogy between Americans' acceptance of the Clinton presidency and Bush's election victory, then you are blinder than blind. But just as Democrats screamed at Clinton antagonists to stop visiting the past (namely the Lewinksy blow jobs), you best follow your own party's advice and stop returning to the election topic. Otherwise you prove that you are no different in any shape or form from the Republicans you so despise.
Yes, you are correct...we have fallen far, indeed.
Do not weep for us, though - we are will only reap what we have sown.
I learned recently a very illuminating tidbit. According to a friend - the last year an average family of four could afford to support a family on one income AND own their home AND be able to send their children to college was...
1963.
Silver was taken out of U.S. coinage in 1965 (the year of my birth). The "guns and butter" policies (Vietnam and the "Great Society") of Johnson began during this same time period.
Our culture is now unbelievably course. Our children, for the most part, are poorly educated. Our military can't find enough recruits (Oh, we've recently made the black beret of the U.S. Army Ranger -- who EARNED the right to wear it -- the standard headgear for all soldiers...it's going to help with recruiting, you know ).
As you observed, we can't even provide ourselves with sufficient amounts of energy.
Yes, we're in trouble, but 50% of us are not surprised in the least. It's the other 50% who are in for the rude awakening.
A friend of mine recently gave me his theory for stock market optimism. After being rewarded for almost any trade made on the nasdaq,these investers thought that they had it all figured out. Their confidence increased with every profitable trade. Now that the bubble is broke, they still think their methods of picking stocks are sound. Nobody told them that" even a turkey can fly in a tornado".
http://www.webpal.org/list.htmDate: 21 Jan 2001 00:12:47 -0000
Mailing-List: ListBot mailing list contact Y2KFIND-help@listbot.com
From: "Y2K People Finding People" Delivered-To: mailing list Y2KFIND@listbot.com
Subject: Missed Opportunities
Sender: Y2KFIND-return-220-44953900@listbot.com
Y2K People Finding People - http://www.webpal.org/list.htm
Missed Opportunities
Times and situations have come and gone.
As I have repeated ad nauseum in these letters -
I was never a Y2K believer in TEOTWAWKI
although even Y2K was a bit milder than I expected.
But I thought there was great potential for catastrophe
in July of 2000
as we led up to the Millennium Conference in September -
which was a Great Flop,
as I said it would be if we did not have the catastrophe first.
�.
Before Y2K I said that we wouldn't see gas problems -
showing up until March 2000.
I wrote an article saying that Natural Gas was the Smoking Gun.
Problems now occurring -
but the Nay Sayers have convinced everyone that it wasn't Y2K
and the microprocessors.
(Beach when will you come off that?)
But - less natural gas -
less electric generation -
higher electric costs -
more plant shutdowns -
more employment layoffs -
maybe even effect on the controlled stock market.
Some would blame it on Bush -
others on Clinton -
none on Y2K.
But what is the problem?
Sudden more demand for natural gas?
(Nope not as much being transported).
Less natural gas in the ground?
(Nope - the Lord's still left it all there.)
Less ability to get it out.
(Not so - say the Nay Sayers).
Just a political - market - schmoggle.
(You think?)
But not to worry -
in spite of the fact that there has been a RECESSION
EVERYTIME a Republican administration has taken office
for the last EIGHTY years.
Who said "it was the economy stupid" -
it MUST have been because of the democrats before them.
But, what, "Me Worry?"
Not me - I am with Alfred E. -
and besides I have bigger worries.
Doomers never die,
they just find something else to worry about.
Lots of things for a doomer.
�
Bruce Beach
survival@webpal.org
Given your age you revealed here (I guess between 50 and 65 years,you don't sound like a retired man JUST working in the garden,you seem to tend also the Golden flower in the professional world.Or do guys like you never retire???),anyway,you think Comex will default in the not too distant future,and assuming you don't wanna miss that one ;-]
What will happen in 2004 when the ECBanks are going to review the Washington Agreement and Comex did NOT default?
I can understand that the present Gold pricing system has to die on its own weight (BTW,what does paper weigh?),but what if those 95% western thinkers will still be happy with buying paper substitutes (sounds like prostitutes..) and yet the system is not going to deliver anymore cheapest physical Gold to those like you and me ready to buy tonnes of it?Or did I answer my own question ?
I waited until this morning to respond to everyone's posts. I was really hoping that someone would come to my defense; instead, I see that I am still being castigated for name-calling.
You guys, I believe that garrulousness (wordiness) does not necessarily equal intellectualism. Or rationalism. Often it is the sign of someone who hasn't boiled his argument down to a few simple points. Name-calling, properly done, can be the most elegant of arguments because the writer has torn through layers of fluff to get to the heart of the matter. (This is NOT to say my post yesterday was elegant; it was a knee-jerk response to a post that was unkind both to Peter and to the legions of conservatives who were rejoicing at that very hour over the new administration.)
PH, I don't know whether you're a sore loser or not. But it was tactless of you to write what you did yesterday. You weren't going to change anyone's mind, and you took some of the brightness off a very happy day for many people. However, you DO sound like one of Black Blade's grasshoppers, and for that I do not apologize. As for California being willing to purchase power from other states (versus stealing it): if California were willing to pay what the market demanded, if the utilities' credit were worthy, and if other states felt that they could spare excess power, it seems that a mutually acceptable arrangement could be made. However, California has DEMANDED that other utilities give up their power, and (judging by your comments) its citizens STILL don't seem willing to have power plants in their area; this is why people are resentful of California.
Auspec and Mr Gresham, please judge motive before you criticize.
http://www.lordoftherings.net/For you Lord of the Rings lovers, I found this on the Timebomb 2000 site. Thanks to Carl Lilly. Enjoy, providing you haven't already found this site.
< Edited to add that word has gotten out, and you may have a hard time trying to access the clip, their server can't keep up with the requests Try again later tonight or tomorrow.>>
I believe this year will be very positive for gold. Both from the standpoint of a higher price and greater acceptance of gold ownership. More people will realize that they were forced into risky financial endeavors, all of which were truly out of their control. They were forced into financial speculation; the stock market, real estate, collectibles etc., because they could not afford to merely save their increasingly worthless fiat money. Inevitable inflation quickly robs their fiat money of all value, long before they reach their retirement age. Those people that realize this in the first place, and were lured into the purely speculative pursuits under the guise of increasing social acceptance by the Orwellian triangulation of repressive taxation, unrelenting pied piper investment propaganda from entertainment portrayals and news media "reporting", and the freedom afforded to the "little" investor to trade with the Big Boys by the internet, these people will become strong proponents of gold and silver.
It is those people who never felt comfortable with the risk they were assuming by feeling pressured and in reality forced to risk their savings, the collapse or continued slow devaluation of the stock and real estate markets will be a bitter pill to swallow. They will slowly move into the political arena demanding the only answer that history has ever supplied to people in such a situation. That answer is simple: Money has to have INTRINSIC WORTH in order to maintain a STABLE VALUE for social justice to prevail. The fraud of fiat money forces good people to gamble with their savings, just to try to stay ahead of inflation to maintain the purchasing power of their savings.
The system we now have forces the earnings out of the hands of those who work, into the hands of others. This loss of control over ones destiny is most cruel to those who would be content in merely SAVING what they earn. More people will realize that the Euro is backed by 10% gold for sound reason, not gimic. They will also take notice that government to government transfer of wealth is performed with gold, not the fiat money the average person is forced by law to earn and spend. It is this realization as expressed in our political system that will return our country to where the founding fathers launched it; with a monetary unit named a dollar that is fully backed by gold or silver on demand.
The fruits of ones labor from 40 years past will again be as valuable as if that labor was performed today. With a dollar fully backed in gold and silver this will occur even if the money has been kept under the mattress for the past 40 years. This is the honest way of "buying time", in which to reflect on a life lived in comfort and honor, and financially able to further invest in the next generation.
The more people run away from the past, the quicker the past becomes the future. Truth, like fact, always prevails. Gold is forever.
Beginning about the time of the November election and with the ensuing controversey, I have a new perspective on the discussion of politics to wit:
"Leave the endless and divisive discussions about political matters to the politicians, the very rich and, the underemployed. Take good care of your business and your family."
While staring for hours at these 30 yrs-charts...can we give correct explanations, for rise and fall of both ?
Is there an economic logic behind the 5-10-5 yrs (1980/2000) move of the US$-index ? 5-up / 10-down / 5-up.
Is there any relation between these up/down-waves ?
Who dares to pinpoint the exact reason, why, the world wants him and, why, they don't want it anymore ?
Each individual on this globe changes his/her opinion on
"store of value" in the relation to mass-trend. It takes too much effort to "argument" " WHY " we do this or that.
A trend starts, develops and ends. Arguments are time-consuming, and not anticipative. Perception is the only force, that makes trends happen. Fear and Greed are the fences. Trust and value are reason. Price is perception.
Economy is the result of the emotions of the masses. Economy has little to do with mathematics.
Looking at both, dollar - POG, 30 yrs charts, give the perceptual feeling that they are out of synchronisation.
30 yrs is most probably not enough time, for coming into harmonic balance. Some fragments of these 30 yrs, do inter-relate. But are not confirming the Big Picture.
Each one of us is daily confronted with the same question :
what to do with the excess paper, after having satisfied all consumer-needs ? This is the vital perception point.
We do not use our reason here, but look at what people around us are doing. We listen to their story, buy it and act upon it. The trend has started.
POG, between 250$ and 350$ is....still a continuation of the existing down-trend. A 13 yrs downtrend, within a 21 yrs downchannel. Nothing, but the 350$-price is going to change this trend and its dominating perception.
We are convinced that our arguments are rocksolid for justifying, our early (?) anticipation. Are the past 30 yrs, giving us enough evidence, for being resolute ?
Is it the US$-dominater or World-economy, who's going to trigger the perception shift ? Can the gold-procers, force a turn-around of the down-trend ? What are the consequences of a strong revaluated Gold-value ? Shift from dollar-hyperconcentration to Gold-hyperconcentration is another creation of imbalance ? The dollar has the capacity of destructing itself, by destroying the bad dollars for the good ones. Will Gold function as a transitionnal value ?
Is Gold, panic-affective ? The dollar plunge of 1985, resulted in a slim Gold-doubling. What is different NOW ?
You said:Yes - what you say is correct if your assumption that the US government is functioning as a democracy or representative republic is correct. I would disagree that this is the case. The US government seems to be controlled and has been for quite some time by banking interests. We are led to believe our votes count, etc., but there seems to be little evidence that those we elect represent those that elect them. It would seem the banking interests purchased this government at least 90 years ago or so and haven't relinquished control to the masses that I've been able to determine. This government seems to be a corporate/banking dictatorship controlling commerce, social policy, and above all monetary policy.
*****************
I do not wish to dismiss your views with a brief response, but I am on the run today. What you say is indeed the case, however, this character of democracies, that vested interests (government and non-government)are more in control than the electorate is a constant throughout political history (of world democracies) regardless of jurisdictions. Welcome to the real world. In other words, what you see is not only what you get, it is as good as it gets (more or less). One cannot get rid of corruption and vested interests - even the individual citizen voter has those. But when a government ceases to have to pay a political cost for its policies, then the citizen will start to have grounds for complaint and worry. The first stage of this is often an oligarchy structure - when the system "devolves" in form gradually. A right or left wing revolution of extremism can precipitate the problem immediately of course. Or one can elect an extremist right or left wing government democratically and they can restructure within to maintain appearances while the process is corrupted. We had this event in Ontario very recently.
You in the US have and have had this process go on in state legislatures too. Note however, that a feeling of disenfranchisement is not necessarily symptomatic of the reality.
Statistics on the federal law enforcement presence released last year by the Bureau of
Justice Statistics illustrate unmistakable increases in the numbers of federal agents,
prosecutions, and convictions. From 1997 to 1998, the number of federal criminal
court cases increased 13 percent. The number of people brought to trial by federal
police increased 12.7 percent from 1997 to 1998. The number of federal
law-enforcement officers has increased from 69,000 in 1993 to over 83,000 today. The
number of federal inmates is up 90 percent since 1990 from 57,000 to 109,000 people.
Most of them are in prison for drug or immigration offenses.
Some of the statistics are attributed to the federalization of crimes that were formerly
state offenses (in itself a bad development), but much of it can be attributed to federal
police officers� willingness to take on ever smaller and more insignificant cases.
According to the National Association of Criminal Defense lawyers, the threshold for
triggering federal prosecution has declined in recent years and continues to do so.
Smaller and smaller amounts of drugs are necessary to trigger possession
prosecutions and businessmen from smaller and smaller companies are being harassed
for hiring the and firing the "wrong" people. Federal agents have fewer and fewer
qualms about shutting down businesses who do not sufficiently cater to the special
interest groups to which the DOJ has been pledged to serve at any given time.
This is the federal law enforcement situation that the next Attorney General will inherit.
It is a federal department committed not to protecting the rights and property of
individuals. It is committed to disarming Americans, harassing them with unending
legal intimidation, and sanctimoniously denouncing as "criminals" anyone who doesn't
openly embrace their edicts and their interpretations of federal law. It is difficult to see
how the very existence of the Justice Department and the office of the Attorney
General is at all congruent with the philosophy of American rights and liberties.
John Ashcroft may be a fine man, but it is unlikely that he will ever be able to truly
combat a bureaucracy so committed to spying on, harassing, and prosecuting average
Americans of average means. After a decade of expansive federal law under Bush I
and Bill Clinton, it is impossible for any ordinary person to know what is expected of
him from the federal government. The millions of pages dedicated to governing the
actions of every small businessman, every worker, and every citizen are impossible to
follow. Ashcroft's enemies question his ability and willingness to enforce the laws of
the United States. They complain that he may be unwilling to browbeat the American
people into accepting the legislation wrought by urban intellectuals, recipients of
corporate welfare, and hysterical loudmouthed "activists". One can only hope that they
are right.
Sometimes it's painful to read the business press, and never more so than during an
economic slump. Reporters flail about for explanations. They quote stock analysts,
politicians, day traders, other journalists, and even, from time to time, academic
economists. But they never seem to arrive at anything approaching an explanation.
If you are purporting to examine the merit of various anti-recession measures, you
surely need some explanation of the recession's cause. The most common attempt at
a theory has something to do with consumer confidence. The press likes this one this
year, because this is the Clinton administration's theory as to why, day by day, the
economy becomes weaker.
You see, Clinton's spokesmen have repeatedly said that the incoming regime is
threatening recession by the mere fact that Bush and Cheney are talking about it.
Remarkable. Bush isn't even president yet and the Clinton crew is blaming him for the
economic conditions of the past two quarters!
The idea is this. If consumers believe the economy is headed down, they might save
instead of spend. The business sector, afflicted with the same fears, doesn't invest.
The two forces merge to create a decline in overall demand for goods and services,
and, next thing you know, it's straight into the economic gutter.
So is there anything to the "talk theory" of recession? As Frank Shostak has pointed
out, this theory implies that underlying economic reality has no meaning. Whether we
are rich or poor depends on our collective state of mind. A recession becomes
nothing but a national bad mood.
On the same theory, you could also claim that the economic boom of the 1990s was a
result of happy talk from government officials. And maybe, based on this idea, the
best way to avoid recession is to turn off our radios, televisions, and computers. We
should just sit back and meditate on government press releases. That'll keep the boom
going.
Gosh, maybe we can talk our way into perpetual prosperity. If only we knew the magic
words, we could print them in a book and ship it to the developing world where they
can all talk their way into prosperity too. Maybe there should be jail sentences for
naysayers, who, after all, threaten the national well-being.
Does it sound absurd? Of course. But the business press, woefully uneducated in
economic theory and relentlessly biased, reports it straight, as if those pushing the talk
theory of the business cycle might not have a political purpose in mind. And that
purpose is obvious: deny the reality of the situation and promote an illusion of truth.
That's the Clinton way.
Another theory going the rounds is that business cycles are like Clemenza's theory of
familial war from Godfather I: "This thing's gotta happen every five years or so � ten
years � helps to get rid of the bad blood." And sometimes there seems to be a
superficial plausibility to the idea. But to say something happens in cycles is not to
explain it; it is only to observe the obvious.
Business cycle theories are legion and they come and go. But the only explanation that
has stood the test of time was first advanced in 1912, in Ludwig von Mises's
masterwork, The Theory of Money and Credit. Elaborations on the theory, by Mises
and his student Hayek in the 1930s, culminated in the Austrian theory of the business
cycle.
The theory begins by observing the profound effect that interest rates have on
investment decisions. Left to the market, interest rates are determined by the supply of
credit (a mirror of the savings rate) and the willingness to take risks in the market (a
mirror of the return on capital). What throws this out of whack is manipulation by the
central bank.
When the Fed feeds artificial credit into the economy by lowering interest rates, it
spurs investments in projects that eventually don't pan out. For example, the high-tech
and dot-com manias resulted from a decade of sustained money growth via lower
interest rates. When the Fed stepped on the brakes to prevent prices from rising, it
prompted a sell-off, and hence a downturn.
What's tricky to understand is what can't be seen. Just because prices aren't going up
doesn't mean the money supply is in check. Just because people in some sectors are
getting rich doesn't mean that the prosperity is on solid ground. Just because the stock
market is going up doesn't mean that the architecture of investment (to use James
Grant's phrase) is in good working order.
Right now, conventional wisdom says that the Fed needs to flood the economy with
money and credit. But as we can see, it is precisely this path that created the problems
to begin with. Besides, Japan tried this trick in the 1990s, even lowering interest rates
to zero, without effect. No Austrian economist was surprised when the Fed's dramatic
intervention this month produced no lasting effect on the markets. Clemenza is correct
to this extent: there is bad blood in the economy and it needs to be drained.
There are ways to make recessions easier to endure. Cutting taxes is one of them.
Getting rid of regulations that hinder enterprise is another. The outrageous hounding of
Microsoft among many others facing the antitrust guillotine, as well as the many
trumped-up suits against businesses for "racism," must stop. These are prosperity
killers. The purpose of freeing the market is not to stimulate demand (as Bush's
advisers seem to think) but to unshackle entrepreneurship and permit the consuming
public more choice in using their money.
As you can see, this theory is at once too sophisticated and too clear
for most business reporters to grasp. They aren't interested in reading a
dusty old treatise on monetary theory. Neither, I'm afraid, are Bush's
economic advisers. But at least Bush's intuitions are on track. A big,
immediate tax cut won't stop the slide, but it will cushion a hard
landing.
January 19, 2001
Llewellyn H. Rockwell, Jr., is president of the Ludwig von Mises
Institute in Auburn, Alabama. He also edits a daily news site,
LewRockwell.com.
ET, thanks for the Ryan McMaken article. Weel said, that.
Galearis: Re--"When ONE has to watch what ONE does or says in relation to ONEs (pun intended), THEN ONE can start defining ones political environment in terms of fascism."
That makes the "Politically correct" phenomena specifically Fascism. Thanks for enabling me to put it in it's proper perspective.
First I will give the basis on which my premise on the trend of POG in 2001 is based. Though it may seem a little long, it is necessary to understand, and evaluate, the reason behind what has been happening, is happening, and is about to happen to that �barbarous relic� as termed by Keynes, at least, in the way I (and my money) see it.
Gold is first and foremost a political metal and, therefore, dependent on �the government's� overall agenda � and that covers a wide spectrum, not merely monetary or fiscal.
I am also using the term �government� very loosely and not referring to any particular national government. The world has come a long way since there was any significant relevance concerning major international issues and individual national governments. And it (the relevance) grows less each day.
True, certain governments are used more than others, at particular times, in order to affect an agenda, in the same way that a carpenter or other tradesman might select the right tool, from his tool box, for the job in hand.
We currently look to the United States for direction, because that country, at present, (note I stress present) is the best tool for the job.
Sometimes a tool, through over use, can become less reliable, but, through habit, we find it hard to let go and replace though, for practical reasons, we see the need. Sometimes we can't replace it immediately as an alternative isn't available. (Are you beginning to follow the analogy?)
The international scene is, currently, in the process of metamorphosis. The US and the dollar cannot be replaced overnight. In fact, because of the present tenuous international financial and economic structure, only by treading slowly, and carefully, can any changes be made - as one would pass through a minefield if one hoped to reach the other side in one piece.
What we are now seeing is the �transfer of power� from dollar diplomacy to Euro. The dollar is over worked and tired. The US by its, perceived, belligerence (depending on which side of the fence you are sitting) on the world stage has become an embarrassment, and hinderence, to those that are promoting and projecting the �new world order (though, they made it so).
The union of Europe, though a dream of many over the ages, is still an untried experiment in the process of development. So also is its new currency that doesn't take tangible form
until January 2002 (not too far away now).
Two large and nationalistic countries like France and Germany do not give up their beloved francs and marks lightly. They know that once done, it is almost certainly irrevocable. The key behind the success of the experiment has been to dip in one toe at a time � hence the wait for the actual surrender of the �national� coinage.
There is also the tradition of currency backed by gold inherent in the European psyche. France, or should I say, the Frenchman, in particular, has a long historical love affair with gold, and a strong suspicion of fiat money. He has only to look, and reflect, eastwards at his German neighbour to know what can happen to fiat money in hyperinflation; then south to Italy where the lira has become a farce � an unemployed from the Bronx could almost make it as an Italian �millionaire� with his welfare hand out.
Against this, we have Switzerland with its (so far) strong, gold backed, Franc and years of financial and economic stability.
As stated, we are in a transition period. Transitions, in general, take time � the transition from an agricultural society to an industrial one took a good century before it was firmly established. There is also a strange phenomenon associated with such transitions, the early days are hardly noticed, or identified, as radical change taking place. People are just aware that something is happening that is making them feel uncomfortable, and they hit out at anything in their way with which they are familiar and they can believe, or told to believe, is responsible.
There is not just ONE reason why the price of gold is manipulated � in this case � held down. Because of cause and effect, and one effect being another's cause, there is rarely just one reason for anything, and this is especially true in the world of economics and finance.
One of those reasons, though, and a main one, is that in order for the Euro to take root and grow strong, there must be no other drain that sucks away its food supply. If gold had been at the mercy of free market forces, where do you think the food (money) would have been sucked� long before now? Certainly, I am sure you'll agree, not by the Euro.
This would be a disaster for the whole European experiment. Though it may have delighted many, in particular, the proverbial, goldbugs.
Remember, I stated that there is never just one reason. Time does not allow me to cover other reasons, but there is a number of other important ones which has allowed those with the agenda, to get a lot of mileage from this particular �deceit �.
Because we are posed with answering the question � will 2001 be favourable or not for gold, the transfer of power from the dollar to the Euro, and the establishment of the Euro as a dominant reserve currency, is perhaps the reason offering the greatest influence.
The agenda, of which I have mentioned, is NOT something NEW. It is very old, it is just that it is now in its final, and most delicate, stage. If you accept this, then you will understand that very little is not well premeditated and, consequently, various scenarios and emergencies planned for.
For instance, it would be obvious the �manipulation� would eventually become discernable and then VERY discernable. But even this, on the surface negative, could be turned into a positive (an art for which they have a penchant, and expertise). Big money outside the Cabal, the type that could have sent alarm bells ringing ( and software �flashing�), would observe the writing on the wall �KEEP OFF GOLD�, the power of the perpetrators recognised, and would find another outlet for the preservation of their wealth instead of fruitlessly complaining, and moaning about �what's happening to the price of the precious metal�.
We have seen a dramatic rise in the other key PM.s, some you hardly ever heard of
a decade ago. A number of weak excuses have been given for their apparent defying of gravity, but the most shallow is the one that they are used in the automotive industry � and this at a time we are seeing huge auto manufacturing cut-backs on an international scale.
Platinum and Palladium have been used for the preservation of �serious� money to replace gold and silver. Reason? They are not, by tradition, political and not associated with �fear of inflation�, by the masses. The demand and activity in the physical has caused the paper dealings to flourish, allowing greater participation than would otherwise have been possible.
At this point, a word about silver would be appropriate. In order to diffuse the focus on just gold, and its manipulation, it needed a bedfellow � silver was the appropriate choice. It really is as simple as that. It is embarrassing now, but how would it have been, for the manipulators, if silver had also been reaching for the stars?
So, wither gold in 2001? This year will be the turning point for gold to start catching up on some lost ground. The hold will be released a little, and in the process there will be some volatility � not wide swings, but swings.
The Euro should reach dollar parity, and be showing strength by the end of summer. The dollar will be obviously declining. There will be volatility on the stock markets to keep people guessing, and keep many �locked in�. Mining, along with other commodity shares will be moving up which will seem strange as there is a perceived general economic slowdown � especially in the US.
What will really be happening is that serious money will be taking its positions ready for the great march forward again, but this new economic era will not be in a way that repeats the past, and not with the US calling the shots � or should I say, the US being used as the voice that calls the shots. (Detect the subtle difference?).
What we should never do is to let what appears to be the negative blind and frustrate us so that we don not see the positive. In Chinese, the character for crisis is also the same as for opportunity. We will eventually see that what has happened is good for the gold industry. It has forced belt tightening, searching for cheaper methods, and amalgamation � something that has been going on in other industries for some time.
2001 will see the worst over for gold and the mining companies that have stayed the course and are now leaner, meaner, and through acquisitions, bigger and stronger
The POG, I expect to finish up 2001 around $300 to $350. However, there will be much volatility, for a number of reasons, and some swings may appear wide, but when viewed on at least a five-year chart will be seen more in context.
.2002, however, will be the year that really provides the rewards for those who got in early while the blood was running in the streets (or down the mine shafts) and we should see gold up in the $400's.
While this is still below where it could, and should, be (there will always be manipulation, though perhaps more covertly) we must remember that the mining companies will now have a lower cost base and therefore be more profitable, and highly responsive to any gold price increase.
I will leave you with the following:
"������..You have to chose (as a voter) between trusting to the natural stability of gold, and the natural stability, and honesty and intelligence of the members of the government. And, with due respect to those gentlemen, I advise you, as long as the Capitalist system shall last, to vote for GOLD."
Hey Leigh,
This guy meant NO criticism whatsoever of anything you posted yesterday. I'm sorry that that was somehow conveyed to you. You have nothing but the most sincere motives in my simple mind. As far as to coming to your defense- you were defending your cause so nicely, there was no need. Another gentleman squirmed a bit under your "name-calling" and protesteth a bit much, but I saw no other castigation from anyone else.
Farfel pretty much summed it up in his post earlier today. What a lot of us struggle with is the REDUNDENCY of certain posters and arguments as if endless repetition is going to accomplish something. I have had several opportunities during discussions to make what I felt were important and explanatory points to he who represents an opposing viewpoint, only to have these explanations ignored or totally dismissed. My response--- time to move on as opposed to continuing to thrash that dead carcass with a corresponding dead mind and ears.
As far as to my possible objection to name-calling, please re-read my post yesterday "One More For The Rhodes". It can be quite divisive, but IMO it can also be a clearcut form of communication. I only stand up for the west coast guy's right to speak out, as I certainly also do your's. Now if you used the term "loser" or "Grasshopper" 26 times we might need to drop a few hints for you {smile}.
Best to you-- Go Lady!
"If we had deregulated consumer prices, this would not have happened. We have plenty
of power, but since it's artificially cheap, we use more of it. So the obvious alternative
to the State shutting down people's power randomly is allowing people to buy the
power they want or need. There is no need for rolling blackouts except as a political
tool to convince the unaware that more State authority is the solution.
"Ladies and gentlemen, those of you who haven't "got it" yet, this is a fundraiser. As
Harry Browne is fond of saying, the State has broken the legs of the power industry in
California and is now attempting to foist crutches upon them so that it can claim credit
for the solution to a problem that would not exist but for its machinations. These
Soviet-style shortages (rolling blackouts) are the result of a policy more designed to
increase the State's power than to actually "provide" power to anyone."
"The consumer groups are rabidly accusing power companies of terrorism and
encouraging the Governor to use the National Guard to intimidate the power
companies into selling their assets (thus removing their ability to do business), and
lower their prices (thus putting themselves the rest of the way out of business). This
would also have the effect of establishing California as an official police state. Papers,
please? House-to-house searches for generators?
"Have no doubts, those making these suggestions (using the military to forcibly control
industry) are Fascists, in the most basic way. They are arrogant, self-righteous,
power-mad control freaks. The so-called consumer groups here in California are
separated from Nazi Germany only by racial rhetoric and fashion sense."
Environmentalist extremists need to hide the cost of their policies, lest they lose public support very, very quickly.
I'm surprised that such instrusive power regulation exists in the US and that there is not some legal remedy for the power companies to use against the California state government. Perhaps the current, more conservative Supreme Court would be willing to (re)visit this issue? I believe that the limitation on impairing the obligations of contracts has been given some new life.
I may skip the current contests due to time pressures. Further, I have trouble making sense out of the current gold picture. There are a number of plausible theories and hypotheses, but I don't have the background or the time to ascertain which one is the most true.
Quaere what is a "reserve currency" in post-1971 period, where no currency is gold's alter ego, and where gold no longer serves as a form of mandatory settlement on other central banks? To what degree does the IMF mandate the use of the dollar? What role can other strong fiat or SDR's or gold serve, per the IMF statutes and other international arrangements?
Welcome SLATTWelcome to a new cyber home- may your retirement years indeed be golden {wonder how that expression came about?}.
Thanks for your thoughtful "Gold Odyssey" post, makes me wish I hadn't felt compelled to put up a farcical Odyssey. Maybe they'll give me another entry.....naw, I'll stand pat.
As per Euro "backing" with gold, believe it is actually 15%. Of course it is not a real backing because there is no exchange available, but worthwhile nevertheless. As per the country with brand new leadership {figureheads to a degree}, what is happening with our reserves? Clearly leaving port to defend the US Banana, for who knows how much longer. Those presses are not running at capacity because all is well in River City. Makes me worry a bit that all of 2001 will not be available for cheap accumulation. Hang tight,Al!
This is a fine site upon which even my irreverence has been largely made welcome, and we in turn welcome your insights. Spend as much time as you can in Archives and HOF as they are there for good reason, if I may give a piece of advice.
Best to you.
"California's periodic water "crisis" is another unnatural disaster caused by
government regulation. The big problem is that most of the water in the
state has been regulated for decades by the Federal Bureau of Reclamation,
which heavily subsidizes the irrigation which delivers water from the
northern part of the state to the bone-dry southern part. (Seventy-five
percent of the water comes from the north, whereas 75 percent of the
population is in the southern half of the state).
"Some 85 percent of the water is used for agriculture and is sold at
government-imposed, below-market prices. Some farmers pay as little as
$3.50 per acre foot for water that costs $100 per acre foot just to pump
through the government-run irrigation system. At these prices it is
"economical" to grow cotton and rice in the desert, even though the
Mississippi Delta and the rice paddies of Vietnam are more natural habitats
for these crops. California grows prodigious amounts of both.
"Government-subsidized water use for one purpose alone -- irrigating
pastures for grazing sheep -- exceeds the water used for all other purposes
in California, residential and industrial. In one recent year $530 million in
taxpayer dollars were spent on pumping this water to sheep ranchers when
the gross revenues of the sheep ranching industry in that year were less
than one-fifth of that amount, $100 million.
"Meanwhile, cities throughout the state suffer such severe "water shortages"
from time to time that government toilet monitors have been employed to
enforce three-flushes-a-day regulations. (I am not making this up).
"The Federal Bureau of Reclamation's crazy central planning scheme is the
main cause of California's periodic water supply crises. As with electricity,
only a free market in water can put an end to the insanity."
You think you have something new to say about any of this political rubbish? So why don't you say it! Otherwise, leave me alone. Yesterday was the day that Dubya was sworn in and this "special day" was being wallowed in by several posters. Princess Leigh found it a "bright and happy" day. You, yourself, seem to think that Bush was elected by 50% of Americans. But of course, this is not true. You (and James Baker) can say it as often as you like (repeating the big lie ala Goebels and company), but it will never be true. Never! Not ever.
The truth is that Gore got more votes than Bush did.
So I probably speak for more people than you do. I say what I like. And I don't need your permission nor your approval to do so.
As I have tried to articulate, (and as you seem unable to comprehend) I do not care in the least whether the irregularities in Florida might have, or might not have given the election rightfully to Gore. I care far less about that than you do, or Leigh or Peter.
What I do care about is the behavior of the Republican party.
"Stop all that counting, right now! It's not fair. Etcetera, etc. etc."
This is just not behavior that I am prepared accept without comment. Even if it is over.
Beacuse it's not over. Having gotten away with it once, it will now become normal behavior from now on. We can expect nothing but more of the same from now on. Count on it! And all because people like you accept it.
Now, Leigh:
How feminine! Stand up and call people names, then disappear hoping that everyone will jump up and defend your idiotic ideas. Well, I'll tell you why it didn't happen.
Because they are idiotic ideas. You cannot find one word that I have ever spoken, written or otherwise expressed about the power situation in California. Period. Not only "don't (you) know whether (I'm) a sore loser or not", you don't have the faintest idea what I think about the power situation in California at all. Whatever seems to you like grasshopper behavior is solely and completely the product of your own unoriginal imagination which has obviously been inflamed by the mere fact that I live in California. You might inform your imagination that Mr. Farfel also lived in California for years. Does that make him a "grasshopper", too?
It also appears that someone has taught you that "name-calling, properly done, can be the most elegant of arguments because the writer has torn through layers of fluff to get to the heart of the matter." Let me assure you that your own name-calling has failed to tear through the heart of anything at all since the only fluff involved is that created by your own poor imagination. Furthermore, you might be well-advised to control your "knee-jerk reactions to perceived unkindnesses "both to Peter and to the legions of conservatives who were rejoicing at that very hour over the new administration" by considering what I said to Farfel above: The legions you so blithely invoke represent less than half of Americans who voted in the last election. If you want to worship arithmetic, you should consider that Al Gore (with all his shortcomings as a candidate) actually got more votes than your shabby hero, George Dubya. With those numbers in mind, I was probably articulating the thoughts of more people than you and your legions. As if I need some justification to express whatever I think. Here. Or anywhere else.
ET your post said it well, however, if I may correct a common fallacy.....
Breaking out of a routine is harder to do as one becomes older, and also as knowledge is lost to the passage of time. Nothing currently demonstrates this as the manner in which rice is grown in the USA.
Rice is one of the rare grain crops that can be grown in a submerged field. It has in the distant past and will continue to be grown that way for the foreseeable future in Asia for instance. The land in which it is grown is too wet for much of the growing season in order to raise other grain or vegetable crops. Pressure on fine Asian cropland (by western standards) has been intense for hundreds of years. Coupled with that fact and the reality of the predictably seasonal monsoons, the blessing afforded by a grain crop that can be grown on such otherwise agriculturally poor land is obvious. Much protein is added to a diet which would otherwise be devoid of protein by the opportunity to polyculture the rice crop with fish. This makes sense for Asian farmers and others with similarly poor land.
The rice farmers in Kalifornia,USA are indeed a breed apart. They artificially create the submerged cropland on which to grow their rice for one of two reasons. The first is that thats the way it has always been done! The second is because it is cheap weed control and cheap irrigation. Of course it is cheap as you well pointed out because of government subsidy at the expense of all taxpayers and the average citizen who must pay their water bill in Kalifornia!
The saddest thing about this situation is the utter irony it represents. Less advanced cultures use an abundant resource (water and naturally saturated land) to raise a crop vital to their survival. While the advanced culture mimics the practice of the less advanced culture in raising the rice in submerged fields, on otherwise arable land, at tremendous cost in taxpayer $$$$ to supply that water, IT IS UNNECESSARY!
Unnecessary, since rice, like wheat and corn, grows beautifully on the same cropland. It is only because rice is able to grow while submerged, that it is grown that way in Asia.
Ramble {not RantWashington D.C., California, Atlanta City Hall, the mindset of at least 50% of Americans. Take your pick whether you want to be dumbed down or beaten down. Or you could join the Cultural War and lend a hand to gaining victory for truth and free market forces, as all on this prestigous Forum are doing.
Scoop for the day----- GATA closely reads and follows FOA {what a shocker!}.
Note---- Believe I heard GWB use the term Democratic Republic one time, but heard the term Democracy endlessly. Anyone else hear these terms. We must fight for our Republic as just being a Democracy will only further entangle us with a world government. The severely watered down US Constitution stands in the way still.
For what it's worth--- IMO GWB is as decent and honest a man as we've seen in MANY decades as US President. He is however trapped in the center of the Oligarchy frequently mentioned on these pages, and these forces are much larger than he. W can hold back the clock a bit with various judicial appointments, etc; whereas Algor would have accelerated the time schedule to the entire breakdown of the Constitution. Will take the victories small and large. They may destroy America, but the American spirit will live on.
As far as Hill in 04, I say "bring her on" for a repeat performance of the goofy candidate Michael Dukakis. That plastic grin of hers is really going to look special with an Army helmet on. I earlier vowed to leave under a hill presidency, but now think it would be too much fun to miss.
I'm finding it quite perplexing and comical the perceived
reverence for George from ANYONE who has hung around this site for more than 5 minutes. The minute the man spewed out the perfunctorial crap about the bible and religion it seems half of you got all 'warm and fuzzy'. THEY ALL SAY THAT!!!!! WHERE HAVE YOU BEEN!!!! They are all sociopaths and your only defence is gold and offshore.PERIOD. It does not matter ONE IOTA what his 'beliefs' are to you and me.
Does anyone not understand this?
First to address CM on the subject of Forum subject. Gold as money, storage of value or vehicle for capital gain is joined at the hip to humankind's economic activities. In our current time there is a rather rampant tendency amongst many, to want to get "something for nothing." The vias to obtain that are, in simplistic terms, crime or the political process. Ergo, in a world of "I vote to tax you" the political process directly affects economic exchange and it's true lynchpin, Gold
Now PH in his, PH in LA (01/20/01; 20:43:50MT msg#: 46031) says "But if the votes don't get counted to everyone's satisfaction, what legitimacy does an official have, anyway?" Good grief, man: How many elections will fit on the head of a pin? Do we vote on whether the vote was acceptable and then vote on that vote ad-nauseam in a process of democracy run amuck? But here is perhaps the crux of the economic crises, Where is it written "Satisfaction Guaranteed"?
When PH "IN LA" says, >>>Did you agree with (Bush) when he said yesterday that the power industry can count on him to do everything in his power to circumvent existing environmental laws on clean air to give power companies, and investors in power companies, even more right to pollute our air? Isn't the right to breathe the very air on our planet something we owe to every living thing of God's earth? Isn't that more important than any �investor's rate of return'? <<<< We have the key to the dilemma. Here is the California, screaming for a clean environment, unable to sustain an emergency relief order by complying with a requirement to conserve only 5% of their usage. Then when they are offered salvation by a relaxation of standards (Hopefully temporary) to stave of economic disaster, the provider of the solution is attacked. Brings to mind a quote from the last energy crises "If you are not part of the solution, you are part of the problem."
Los Angeles along with the rest of the State, is becoming the "under glass specimen" of people demanding someone else be responsible for their needs and wants. Just for a start, there are the decades of being sustained by long standing water rights to the Colorado river. Other peoples water provides the life blood to the city even while destroying in-State environments such as the Former Salton Sea, now a salt encrusted cesspool due to the river that fed it being deprived of most of its water before it gets there. This lays the ground work for the mind-set of needing to be contributed to.
I totally agree with PH regarding "Isn't the right to breathe the very air on our planet something we owe to every living thing of God's earth?" But, the answer to that does not lie in the way of the modern Democratic party, of demanding the solution be provided by someone else's production.
All sorts of clean technology exists to create abundant clean energy, the combustion of hydrogen leaves only water a byproduct, Micro-Sats CAN be put in orbit to beam down solar energy. Solar powered desalinization plants can be built as a water source, with the byproduct of mineral extraction included. The barrier is "Cost effective" and that is the exact blind-spot of our society.
The major negative of the capitalistic, free-market system is the failure to deliver what is needed for the common good. Homo-Americanus sees the solution as tax and spend thy neighbors money. What is ignored is the extent of existing and potential productivity that goes into the reward of legal but parasitic activity. Every dollar that goes to non-productive capital gain, every potential producer rendered incapable by drugs and inept educational methods, every hand idled by day-trading and other activities rendered glamours and entitled to by the brain washing of television and it's accompanying social malaise; this is all part of a gigantic, untapped productivity that could create a world of debt free, clean-aired economic fulfillment. What is needed to bring this about is a major advancement in the state of ethics and responsibility throughout Mankind.
Even if yesterdays fine and elegant words were not said in total true intention, it would be far better to see them as an inspiration for us all to follow nevertheless, rather than denigrate their inspirational image with statements such as "prating, braying, blubbers and empty platitudes."
Per your post: "They are all sociopaths and your only defence is gold and offshore.PERIOD. It does not matter ONE IOTA what his 'beliefs' are to you and me."
I respectfully disagree. They are NOT all sociopaths, any more than all internet posters are internuts. Gold is a great defense, but it matters a great deal to many what our 'leaders' believe. It matters to me! You are welcome to speak for yourself, but please don't presume to speak for the entire Forum. The term 'Oligarchy' is an expression of the reality of the situation, however much anyone approves GWB. My mind is open to what he may be able to accomplish in spite of not caring much for George 1. Some of us are blindly accepting, some moderately skeptical, some extremely cynical. Such is life.
Got Gold and Hope?
auspec: hopefully I will be able to desist in responding after this post and avoid your contemplated "medical intervention" I shudder to think of what mind numbing disablement you might send me by the more permissive via of E-mail. (:-))
PH has again raised the issue reverberating across the land of the fact that 50% +500,000 folks cast there vote for "That other guy." While that "popular majority" may boast of this as a proof of what is best for all of us, it can just as well prove the opposite. I hold this truth to be self evident to all who per Al Fulchino are "a person who sees what they see." Gore won the popular vote because the majority of the vote casters were blinded by their inability to see through the smoke screen of manipulated data and opinion. To me the fact of that majority vote is proof that we live in dangerous times. I personally believe that an "An act of God" is a composite of the power of good-willed beings to jointly effect their spiritual intentions. It follows that they do not have to be in the �majority' to do so.
Fighting like siblings in your backyard, while the neighbor kids sneak in & steal the very toys that are the seeming objects of your squabblings.Ever hear of DIVIDE & CONQUER?????????????
Sorry, but I can't help but admire him - he's got guts.
I suppose, though I never fully realised it, that I have a tendancy to like who the media tell me not to like. I wonder why?
Baghdad booms as Saddam turns sanctions into gold
Jason Burke in the Iraqi capital finds Saddam stronger than ever and a class of entrepreneurs exploiting the UN embargo to make fortunes
Special report: Iraq
Sunday January 21, 2001
Khalil Al-Suhail has a problem. If he opens his restaurant too early it fills up with Western businessmen and he cannot seat the local officials whose influence he needs to keep the place open. But if he raises the fake drawbridge of the Castello - Baghdad's latest fashionable nightspot - too late in the evening the staff will not get the tips they have come to expect and they are likely to mutiny.
But al-Suhail knows it is not much of a problem. Jammed in the road outside the four-month-old fake fort are rows of Mercedes, BMWs and Japanese 4x4s. Most of his tables have been booked for days. 'I've been in worse situations in the last 10 years,' he says. He smiles and crosses his arms and his silver watchstrap reflects the neon that glares from the false battlements above.
He is not alone in his high spirits. From the nouveaux riches sampling the Castello's ch�teaubriand to the beggars who have barely tasted meat in a decade, everyone in Baghdad agrees that things are looking up. Once, the city's streets were full of rubble and stank of sewage, rotting rubbish, violence and fear. Now - as the trade embargo imposed after the Iraqi invasion of Kuwait moves into its 11th year - they are full of traffic, brightly lit shops and consumer goods. There are still spots of appalling misery and deprivation, but everyone says things are changing, that the worst is over, that they have survived.
In fact, they have done more than survive. Baghdad is now a city where $35,000 cars are bought within minutes of being driven into showrooms, where women in leopardskin coats and miniskirts go to the National Theatre to watch the latest avant-garde plays, where you can get a PlayStation2 without waiting, where the caf�s are full until late and markets open around the clock.
Baghdad is also a city that is proud: proud of having survived the sanctions, proud of having survived three bouts of bombing by US and British planes, and proud, above all, of the man whose heavy, jowly features are on a wall in every office and classroom, on a corner on every street, on 20ft-high posters, placards and banners, on book covers, newspapers and magazines.
Last Wednesday - the anniversary of the start of the air war in the Gulf - Saddam Hussein, now 63, received a 21-gun salute and addressed the nation on television. He spoke of the great victory won in the Umm al-Marrik (Mother of all Battles) against the 650,000-strong allied forces 10 years ago. The victory, he said, was continuing and growing. The Iraqi people, and the Arab and the Islamic worlds, could expect further greatness in the years to come.
Saddam's satisfaction is understandable. Ten years ago he was a pariah. Defeated militarily and diplomatically, his economy was in tatters and his hold on power looked shaky. Now everything is different.
The 500-mile-long road from Jordan to Baghdad cuts across one of the bleakest, hottest deserts in the world. Only when you reach the Euphrates, after 10 hours of driving, does green begin to spatter the dirty, blasted monotony of sand and rock. But, though long, it is a surprisingly easy drive. The road from the Jordanian capital of Amman may be crowded, bumpy and narrow, but once across the border, and past a recent statue of a sword-wielding Saddam on a rearing horse flanked by four flaring Scuds, you hurtle along a new six-lane motorway complete with laybys and picnic spots.
On the old road that still runs parallel, a stream of trucks and tankers rumbles west. They are carrying oil, dates, grain and dozens of other products out of Iraq and out of the United Nations- imposed embargo. Soon the sanctions-busters will not even need a road. Two or three times a week flights take off from Amman for Baghdad - again a contravention of the UN resolutions. Similar flights, all supposedly banned under the sanctions, are planned from Egypt and, it is reported, from Moscow.
There have already been flights into the newly re-opened Baghdad airport from almost every Gulf state. There have been planes from France, Italy and, indirectly, America and the UK.
The marbled lobbies of the five-star hotels in the capital are now packed with businessmen fighting over lucrative contracts. Two months ago 1,450 firms from 30 countries laid out their wares at a trade fair. Ironically, the US company SmithKline Beecham was selling its drugs at an exhibition last week to combat 'depression/anxiety, panic and obsessive compulsive disorder'.
At a government level, Iraq has signed new commercial agreements with Turkey, Russia and Libya. There have been secret negotiations with the Syrians, themselves suspected of receiving huge quantities of smuggled oil by rail in recent months. Last week the details of a huge, new trade treaty were being thrashed out with Cairo.
Even British companies have been negotiating with the regime. One consortium recently opened an office in Jordan - as close as they can get without breaking the embargo - so they are well-placed when the nation with the second biggest oil reserves in the world officially opens for business once more.
'The sanctions are crumbling,' said Professor Humam al-Shamaa, a key government economic consultant. 'They are becoming a joke.' Few, even in Whitehall and Washington, can honestly disagree with him. For four years after the Gulf War the Iraqi people suffered terribly. Many across Iraq, particularly in the south, are suffering still. UN reports suggest hundreds of thousands, particularly the young and old, died as a result of the embargo. Five years ago Saddam agreed to a deal that allowed him to sell oil as long as the earnings, placed in a UN-administered account in New York, were used to buy food and medicine. Much of the cash is soaked up by payments to the UN and war reparations to Kuwait. Red tape, and alleged wilful hindrance, have meant that shortages, particularly of drugs, are common.
The result has been serious damage to the country's health. And though the dying children in Iraq's hospitals are cynically exploited by a wealthy regime to impress visiting journalists, in many cases the UN supervisory system has failed. Permission to import equipment used to treat cancers - for fear of use in weapons programmes - is denied. But it is those weapons - and Saddam's unwillingness to reveal their details - that are at the root of the problem. If, the British and American governments say, Saddam allows international inspectors to check he is no longer able to make nuclear, chemical and biological weapons of mass destruction, then the sanctions will be lifted. They have hinted that the 'no fly zones' in the south and north will be ended too. But while the rest of the world is aiding the collapse of sanctions, Saddam has little incentive to make concessions.
One Western diplomat told The Observer : 'The British and the Americans have painted themselves into a corner. They can't lift the sanctions, because it will hand Saddam a major victory. But the system is collapsing anyway. Either way they'll end up looking like fools - and stupid, vindictive [fools] at that.'
Before Khalil al-Suhail invested in his restaurant he did some market research. 'Soon I knew I'd be fine,' he said. 'I knew I could rely on "embargo gold".'
The harsh truth is that the sanctions, in addition to inflicting suffering on millions, made many very rich. Uday, Saddam's psychotic eldest son, has run the bulk of the regime's oil-smuggling operation and made his father one of the richest men in the world. Sources estimate the dictator's wealth at more than �3 billion.
Through contracts and franchises handed out to associates, a wider circle of loyalists has made a fortune. Thousands of young Iraqi entrepreneurs have taken advantage of the distortions in demand and distribution caused by the sanctions - almost always with a nudge and a wink and a pay-off to the regime. The rationing system maintained under the 'Food for Oil' programme has allowed big farmers to make huge sums selling grain and other commodities. And the huge reconstruction projects - such as the motorways - have made many more rich.
Support for Saddam among the majority of Iraqis - despite his well-known brutality - is in no way diminished.
The al-Hashemi family are the sort of people Western planners hoped would oppose Saddam. Intellectual, politi cised, educated (and even with vital military connections), they remember 'the good days' before the wars and the sanctions.
'We have suffered a lot in the last 20 years,' says Mohammed, now a government servant whose $25 monthly salary, added to the government food rations, just about keeps a decent standard of living for his five-strong family.
He is scathing about the 'profiteers' and 'merchants of war' who now comprise Baghdad's elite. But he says - and given that he only agreed to meet in secrecy (his name has been changed) he is probably telling the truth - he is now a supporter of the President. 'As the grip has tightened on our country more and more, we have got closer and closer to our leader. He is now the embodiment of the spirit of our nation and we are proud of him.'
Such support is unlikely to erode soon. For a decade Iraqi schoolchildren have learnt about the great victory of Saddam over the vicious, Muslim-hating, neo-colonialist West. In recent months Saddam's prestige has been boosted by his outspoken support for the four-month-old Palestinian uprising.
At Friday prayers last week at the 700-year-old shrine of Sheikh Abdul Qadeer al-Gilani in old Baghdad a packed congregation heard a sermon condemning to hell those who stood by and allowed their fellow Muslims to be harmed. It was a sideswipe both at those who ignored the Palestinians and those who have failed to support Iraq. Afterwards the imam, Sheikh Afif, told The Observer that the Iraqi people had showed 'the patience of Job' in their suffering.
He recited an Iraqi proverb. 'A journey of a thousand miles starts with just one step,' he said. 'We started directly after the American and British aggression. Now our thousand miles are nearly travelled. Our victory is nearly complete.'
Apparently auspec was right! I'm a poor and deluded shell of a poster, believing I could draw fire from both sides by attacking "Dubya" AND Clinton AND ALGore with my woefully inadaquate and completely impotent post yesterday.
O.K. I concede. I promise never to attempt to diss these folks in the middle of a hostile crowd ever again.
However I'd like to point out to Farfel and PH in LA that NEITHER Bush NOR Gore got half of America's votes. The last census put the population here at about 280 million and only a total of a little over 100 million votes were cast for both these candidates combined.
So, who ever it was that "won" did so with a little over 50 million votes. Simple math shows that:
1. Total non-voters overwhelmed total voters by a healthy 180% margin.
2. The winner, who ever it was, won with the approval of only about 50 million divided by 280 million or 17.9% of the population.
3. Clearly non-voters completely swamped the voting competition by any measure you choose to use.
Regards,
Journeyman
P.S. In case you think our opinion doesn't count unless we register to vote, _still_ only a little over 50% of those registering actually voted. So by the most optimistic measure, the winner has the support of no more than about 25% of the population motivated enough to become registered voters.
Neither got 50% of even those who voted + earlier questions
No candidate received 50% of the votes cast. Neither did Slick Willie in his two wins. (In fact, Gore received more popular votes than Clinton ever did). One pundit made a good comment: the talking heads were unimpressed by the candidates, but the American people weren't unimpressed... voter turnout increased this election. In retrospect, I submit both Dubya and Gore will be viewed as solid candidates.
I still haven't received a reply from anyone to my earlier questions re the nature of a "reserve currency" in the post-1971, post-gold era. Maybe they're silly questions, but I believe terms are sometimes throw about without being defined.
post #46055Excellent post! I believe and "hope" you are spot on. You would think a Pandagold would be a bit more "bearish" on POG.....................Sorry, couldn't help it. Start thinking of a place to keep that coin. Best.
You point out an interesting thing there. We gave him and his cohorts, by the sanctions, a great vehicle for obtaining personal wealth in a regimented society: Scarcity!
A contest is afoot! Notice is served to those just now arriving from afield to our Round Table...
*REPOST*
USAGOLD (1/19/2001; 11:27:32MT - usagold.com msg#: 45919)
Hear Ye. . . .Hear Ye. . . . A Call to Contest. . .
A test of your thinking, predicting and posting skills to occur from now until midnight (MST) on Tuesday, January 23rd. We stand at the first month of a new millennium, a time to stop and think what the future might bring. So the contest is simple as it is challenging:
To wit: Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion. We stand at a threshold -- not just of a new century but a time of uncertainty as the winds of change sweep through the world economy. There could be no better time for a contest with such a theme than now.
Your post must be at least 30 words and it must contain in the subject box the following:
**** 2001 -- A Gold Market Odyssey ****
(Surrounded by stars as shown....to help get our attention when we gather the many entries together at the deadline.)
The prize will be a .1867 ounce pre-1933 French Rooster gold coin. There will be two runners-up who will receive a one ounce silver Eagle each.
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner of will be the one whose arrow falls most closely to the mark, and shall be rewarded a tenth ounce prize that shines with the light of gold. All price guesses must be accompanied by sound reasons for your prediction to gain the prize. And as has been done it the past, it would please our judges if you would use standard arrows in the subject line of your post when you take aim to enter this 2nd contest. Like this:
>>>========= $300.00 ==========>
Also, all first-time posters will be awarded a one ounce silver Eagle if you post during the contest period -- from now until Tuesday midnight, January 23rd, 2001.
To qualify for the prize, you must e-mail jill@usagold.com confirmation citing the message number once you've made your first post. We will check each first-time poster's claim, so don't feel like you can get one by us.
We wish you good luck, good fortune. . . . . .And. . . . .
"A Nation torn asunder?" ... and in denial of the reality of its problems!
No, not by a few thousand votes, alledgedly not counted, re-counted or discounted, nor by the fact that the courts had the final count - imagine the count (or is it toll) by the street- but for the fact that a vast majority may have waived their "democratic" rights, or is it obligations, for the obvious farce John Grisham has so aptly described in his latest bestseller "The Brethren". Is it the the denial of reality - or better we'll do everything for our health, individually, though forget about the health of our family, state, country and globe - be it socially, politically, economically, environmentally, or is it plain ir-rationality or -responsibility?
You don't need any admonishment by any European, African, nor Asian or anybody else, you will say, which is more than true. But then, most of the rest of us has had to use your currency contracts to obtain, no, not your goods, though necessary resources of minor importance to a well balanced first world economy, as such trivial low tech. and seasonal volatile goods (or "bads"} as natural resources, primary energy, clean air, water and soils, to produce natural food, uncontaminated by herbicides, pestizides and genetic engineering, which are as untested to their long term effects, as the use of nuclear power, in the aftermath of Tchernobyl.
And while the international division of labor does work, as long as the fruits of the same are shared on an equal basis, it seems something in this equation has gotten totally out of whack. May it be that all scales of measurement are calibrated on the medium of exchange, the hegemonial US $ supremacy, based on raw power, giving it the right to dictate not only the state of the nation, but the globe.
And while I'm not considered a green environmentalist, I can envision a global warming by blasting our refuse into space and its effects, the pack ice and the glaciers melting, natural castatrophies mounting and lastly the greed induced fallacy of improving our food base by chemical and genetical horrors, which have arrivced to haunt us forever.
Another fervent environmentalist, you may say! So, just look to parts of the ex-communist block. It is just across our (Austrian) borders and you'll see devastated areas as big as Arkansas, depopulated of trees and depopulated of man tomorrow. Vaster areas of depopulation in the neighbourhood of Chernobyl and in the Ural's and have you ever come across the vast new beaches of the Baikal Sea, well toxic stretches of desert, which once was the largest inland lake of the globe.
... And now I'm seeing a country, leading the world via a paper pyramid derivative scheme, telling the rest of the not so well off world (LDC's) to trade their emission rights in order to pay back the same paper, and in real goods, they've never asked for.
... and if some don't believe in the good words, spoken by the new President, I still feel without civility and compassion, liberty is just a hollow word - As the US-$ is only fiat paper, backed by hollow promises to fulfill or default on obligations of yesteryear.
... Your "Talents" may be weighed against GOLD!
Yes! Largely because Ross Perot got significant percentages in both Clinton's runs, Clinton won with less than half of those actually voting, reducing his support even among voting citizens to 46% (I think) in his first race.
Further, less than half the registered voters even bothered to vote at all in Clinton's second race, thus the turn-out in the "Bush/Gore" race shows a minor come-back for voting registered voters.
Both Clinton terms were served with less than half of the voting public having cast votes for him, and in the second term, less than half the registered voters, not to mention that well under 50% were even registered at all.
The figures make it untenable to argue that what these people do while occupying their office represents the will of the majority.
This is healthy, as it shows the appropriate level of supprot for folks who violate their oaths of office from the minute they take them.
Not a landslide but a sea-change
Bush's pro-business agenda will alter Washington
By Rex Nutting, CBS.MarketWatch.com
Last Update: 6:00 AM ET Jan 20, 2001
....The next crisis could be an attack on the dollar. As the U.S. economy weakens, foreigners will see less reason to finance the $400 billion current account deficit. If foreigners pull out their capital, the dollar will weaken, pushing up import prices and fueling inflation.
Consumers will scream, but U.S. exporters will cheer silently.
The question is, what will Bush, O'Neill and Lindsey do?
Flack?Wouldn't think of disappointing you! You must have just peered in at this weekend's fracus and felt a little left out. I bet you won't draw any more ire than Journeyman did, in spite of both of your conscientious efforts. It's not as easy as you guys think it is, more of an art form. You can't just move in for instant confrontation, much better to continuously goad your "object" over a period of time first. It's also better if you fail to take the Doctor's prescriptions for a few weeks prior to actual contest, or eat 2 banana $plits 2 hours before the event. Learn from your teenagers, they have it down pat!
Anyway, so as to not totally leave you left out, and in the lurch, a few insults are coming your way. I'm not a history major, but certainly your fine country has been defeated or rescued, or possibly both, by the country you so casually malign {pretty standard so far}. When I go to work tomorrow will likely do the work of two of my American equivalents and four or more of your cohorts {take that cb2}. Ready for another? Shall we bring up the issue of socialism {splitting hairs now}? OK, better sit down for this one: your single malt scotches are twice the price of my aged rum and don't taste any better! This from a Scottish-American!
Here's the last one.......My Oligarchy is better than your Oligarchy!!! Actually Siamese Twins. You are GLIB {that one is for Peter}.
Gotta go for now---- better get some ice on that!
See ya soon friend.
From fact finding committee to Leigh and All
PH in LA (1/20/2001; 10:32:50MT -#: 45987)
Did you agree with "father" when he said yesterday that the power industry can count on him to do everything in his power to circumvent existing environmental laws on clean air to give power companies, and investors in power companies, even more right to pollute our air?
Isn't the right to breathe the very air on our planet something we owe to every living thing on
God's earth? Isn't that more important than any "investors' rate of return"?
PH in LA (1/21/2001; 13:02:29MT msg#: 46061)
You cannot find one word that I have ever spoken, written or
otherwise expressed about the power situation in California. Period.
"The Early Bird Gets the Worm" ... or ... "GOLD: You either have it or you don't"
http://www.usagold.com/onlinestore/special.htmlMichael sends word that the gold 10 Guilder young Dutch queens have now all been spoken for, and efforts to secure additional quantities have not proven fruitful thus far. Congratulations to all (myself included) who acted early enough to secure an order of these beauties.
So, while the "sold out" sign must come up on those items, MK has been able to land enough additional Kings to keep that offer up for the time being. Don't be shy...gold in the hand is worth $XXXXXXXX???? in contract form when cascading counterparty defaults show paper for the poor wealth substitute that it is.
Hi Auspec, as I suspect(-ed) you'd teach me an historical lesson.
And my country in need to learn your ways and concern - though where have you been, when our scream after
Versaille's treaty was seen as historical alert to Adolf's Regime? - you couldn't be heard and not even discern, the appaesement politics of your old country's leaders, still smarting from tearing apart the continent's girders, maintaining the semblance of an equilibrium to all.
As you know I love your country, and for what it stands - and stood for - and hope it will stand forever for individual liberty - ... and as I've been old enough to have read George Orwell's "1984" before it happened, big "Brother" is watching you ... cb2
So Rex Nutting poses the question -what will Bush do.
Answer - Exactly what he's told to do.
Whatever Bush is, or isn't, I believe he's long enough in the tooth politically, and biologically, to know which side his bread is buttered on. He will want to serve out his presidency the full term, and not finish up, half way, on some mortuary slab.
At least his Secretary of State will appear to have a little more credibility when trying to broker any Middle East peace deal. The last administration's choice, Albright, when sent trying to sort out the Palestinian/Israeli problem was akin to sending a fox to mediate a dispute between a fox and some feathered inhabitants of a poultry farm.
It was incredible that they could have believed it was even remotely possible. Perhaps they didn't, perhaps it was never really intended. If so, their choice in Albright, would be understandable. She was one evil woman both in looks and deeds - her remarks during the Bosnian crisis where appalling. To see her replaced is one giant plus, for me, in the whole election debacle.
Hope I haven't upset too many of you Albright fans, I know there is no accounting for taste in this world. But I could never see her being good for gold, on the reasoning that I could never see her being good for anything that could have a positive connection.
AEIOU?I know of a,e,i,o,u, and sometimes y, but know not of which you speak. History lesson please.
Yes, your interest and love for this country is obvious, should many {most} Americans be so inclined! We may just have to adopt you.
I did forget one more thing: we can {temporarily} balance more derivatives on the head of a pin than the rest of the world combined! What a country. Fairly gracious 1st Lady too, wouldn't you say? Bet our 1st Lady {now} is lovlier than your .................Stop already.
Wish they would give the ants and grasshoppers seperate parts of the country in which to live out life's "hopes". We could send them IMF money and enslave them to the US banana {you know the more I think about that I realize that's what is already happening}.
See ya tomorrow, same goldtime- same goldstation
It's tommorow in Asia and judging by the Kitco charts I'd say some people have given up and are emptying thier desks
or are busy shredding paper a la' the "Bubba"
Looks like someone fell asleep at the short-selling desk in Australia. "R-i-n-g! R-i-n-g!" "Huh? Oh, ya. Right, mate. Get right on it..." There, it's back down again.
Let's see if we can find our place on the map...
The life span of our sun is 10 billion years. It has used up about 5 billion. Assuming we do not master intra stellar travel, we humans have less than 5 billion years before the sun expands and consumes the earth.
Modern humans have been around many thousands of years. Up until six thousnad years ago, the population was only about 50 million people. Today the population is around 6 billion!!!! We are quickly headed for eight billion.
Oil and natural gas became popular in the last one hundred years. Oil discoveries peaked in the early 1960's. Oil production is expected to peak around 2006.
Food production increased greatly with the use of petroleum products to produce fertilizer and pesticides; thus, the 6 billion people.
People, food and oil, that's what it's all about. When the oil Production begiens to taper off, so will the food production. The mortality rate will go up.
There are other problems, like how we water our food or which political party is the bad one, democrat or republican (I think they both suck). We have drugs, rap music, Rush Limbaugh, Jessie Jackson, Michael Jackson....
FINALLY: Here is my point. The list of problems goes on and on but, we don't (at least not in the physical sense).
In the big scheme of things, we aren't even a speck on a gnats behind.
A SUGGESTION: Let's use the great analytical minds here to determine if and how we can best use gold and silver to make our lives a little better. :O)
When the 15 european countries (including England) tried thier last gasp at upending the dollar and supplanting it with the euro, when they claimed that they would not support gold leasing...........
They caved in and now the BIS is the one that is charge of
derivitive record keeping and keeps doing what is neccessary to support the dollar.
Clearly the big boys of the fiat dollar world are determined to carry this world economy onward with credit and liquidity as neccessary. How many years can this be sustained? More than we like to think about here.
So, I say this year will be another year of controlled gold.
The upending of the dollar at this point would crash the world. All the very top big boys value thier comforts and power perks way too much to disrupt the goose that lays the golden egg in thier lives. While I am a Doug Nolan devotee, I see the limits of his vision. I dont wish him to change however! But the very top guys are not doing what they are doing with the view that he thinks they have.
You know, for the sake of us that mainly try to read here, maybe there could be another forum for all the very off topic sentences that get typed here.
I wouldn't pin a prediction on a two hour rally but it could be possible that the PM market shares the sentiment that the new folks in Washington might be a better breed of leadership and therefore more in agreement with "Fair play for Gold"
In conjunction with the contest now in progress, I have talked with Randy @ the Tower and we have decided to construct a temporary wing of the Hall of Fame where all the contest entries will be enshrined for the duration of 2001. I suggest we call this wing "2001 A Gold Odyssey: Predictions On the Upcoming Year from Round Table Members (As posted late January, 2001)." The winner and runners-up of course will be specially honored as they should be. The "Exhibit" will remain open until December 31st, 2001 and we hope that the Table Round will find it a source of discussion (and yes, Auspec, even amusement) for the duration. Under the circumstances and in the interest of fair play, anyone who has already made a post and would like to alter it, we welcome you to do so. Please send a note to the sitemaster with the message number you want included in the Hall.
http://users.sisna.com/ThaiRanch/EagleRanch/index.htmHi Lady Leigh:
Here's a little-something to soothe your jangled nerves today:
Checkout the special Pix-of-the-Day link at the top-right of the
HomePage (klik on above underlined link)... Enjoy.!.
Hi $hifty:
I spent the entire day installing a bunch of new [faster] charts
with more [deluxe] features at the site. Goto the HomePage,
then hit your "END" key on your keypad. That'll take you to
the bottom of the page where you will see [on the right side]
listed 8 new sets of metals charts. They are:
*Live 3Day Overlay GOLD
*Live 3Day Overlay SILVER
*Live 3Day Overlay PLATINUM
*Live 3Day Overlay PALLADIUM
*FAST Gold
*FAST Silver
*FAST Platinum
*FAST Palladium
These all load superfast, and won't burden your cache with
all the usual kookies and glitz from Kitco, that take forever to
load. Hit your BACK button to return to the HomePage. These
charts [like all of them at my website] can be refreshed at any
time, in an instant, by hitting your "F5" Key.
Your "HOME" Key will take you back to the top of the page
for the other links and features. Or you can scroll up and down
thru the page using your ARROW Keys.
As I continue to relentlessly add features and tools that may
be of interest to everyone, I'd like to invite all the New Posters
to visit the site and make use of it in it's myriad ways of fast
access to all the major markets and metals. There's even a
quick Link directly to this USAgold CPM Forum RoundTable.!.
Poke around and see what all is there. I've tried to make it a
versatile one-stop-location for all your needs, sorta like a mini
"office", over there in the dusty corner nearby the RoundTable.
Just a mouse-klik away is a complete library, news, market,
and even some fun-stuff for the kids to enjoy on dull days.
But on fast-moving days, which we can expect soon now, it's
a site that could be very helpful to anyone of the Forum.
Literally, a New WebSite for this New Era.
Thanks everyone, for giving it a try.!. I hope you all enjoy it.
Just mentioning a word in a sentence is not the same as writing about that subject.
If you read carefully the sentences you so gleefully post in your msg#: 46084, you will see that it is about "father" Dubya. Not about power in California. My intention was to underline the words of a soon-to-be chief executive saying that he would "do everything...to circumvent existing... laws". This from the person soon-to-be-sworn to uphold and execute the laws of the land. All the laws. Not just the laws he agrees with. Normally, society puts people who think they only have to obey the laws they like, in jail.
Yes, I did mention power in California. However, I was writing about Dubya. Not about power in California. I stand by my comment to Leigh.
And while we're here, why not ask her why she thought someone else should have come riding to her defense. Isn't that what conservatives are always preaching about? Personal responsibility? Oh I know. That personal responsibility thing is mostly just reserved for those other guys, and for all those insects in California, isn't it?
Davis Confers Daily With Former Treasury Secretary Rubin so 'Wall Street
Understands What We're Doing;' Says California Will Not Drag Rest of
Country Into Recession
NEW YORK, Jan. 21 /PRNewswire/ -- California Gov. Gray Davis tells Newsweek that he
plans to appoint a ``power-plant czar'' this week who will ``honcho'' the completion of five
power plants currently under construction and will expedite the permit process for several more
in the energy-needy state. Davis tells San Francisco Bureau Chief Karen Breslau in the January
29 issue of Newsweek (on newsstands Monday, January 22) that altogether he plans to have 15
new plants under construction before his term ends in 2002. The plants would be the first in the
state since the 1980s.
(Photo: http://www.newscom.com/cgi-bin/prnh/20010120/HSSA005)
Davis, who was criticized for not acting faster, is now trying to increase energy supplies and
drive down prices. And he tells Newsweek that he talks ``three times a day'' to former Treasury
secretary Robert Rubin, now a co-chairman of Citigroup, ``to make sure Wall Street understands
what we're doing.''
But the cost of the power crisis and subsequent disruptions are already costing billions of
dollars and many experts now fear that the problems of the nation's largest state economy may
spill over to the rest of the country, writes Senior Writer Adam Bryant, in a separate story on
California's energy crisis. But Gov. Davis dismisses any suggestion that his state's energy
problems will weigh heavily on the country's economy. ``California will not drag anyone into
recession. It will outperform the rest of the nation.''
Economists;soothing entertainers or hard edged realists?
Good evening,everybody.It's good to see the cyber brouhaha
slowly slipping away,now we can get back to discussing the
politics that really matter;the politics of the dollar.
I may have painted all mainstream media economists with the same brush yesterday,which is unfair to the dismal science.
There are some out there that offer a differing perspective
than the usual talking heads.One of my favorites is Paul
Kastriel at northerntrust.com.I've seen him quoted several
times in various wide circulation financial publications.
He seems to be somewhat jaded in regards to the new economy
dream scenario and uses a wealth of data and charts to back
his arguments and predictions of future directions.
This excerpt is from the daily economic commentary from January 17,2001,I found this paragraph to echo some thoughts from others at this forum.
"As an aside,the majority of the FOMC,perhaps a majority of one,has made it clear that a recession will be fought at all
policy costs by the Fed.Although overall inflation,no doubt,will moderate in 2001 as energy prices stabilize,it is unlikely that it will return to the 1.6% to 1.7%of 1997
and 1998.So,the US economy will embark on a new economic expansion in the second half of this year with a higher inflation starting point.This scenario has 1967-68 written all over it.Greenspan may be about to embark on a squandering of the Fed's hard won credibility as an inflation fighter."
Also, in regards to the strong dollar policy,I would like to thank Auspec for his #46030 posting of FOA's thoughts on the matter.This is part of the incredibly complex,thought provoking debate that was waged by the traveler and FOA.
I spent many hours over the quiet holiday season reading
and re-reading this exchange between the two,but for some reason,I didn't print out this post.I am surprised this
debate isn't in the hall of fame,it is certainly worthy of consideration especially in light of the recent develop-
ments in the unfolding drama.
Some musings on Europe and Europeans, if I may....
Over the years, upon returning to the U.S. from Europe, I have repeated to my patient wife, the same remark: "When you come back to the U.S., you get the impression that Americans are like children."
I think Herodotus mentions that the Egyptians felt the same way about the Greeks. So, there's something to be said for a culture that is as greedy for novelty as a child. But there is much to be said for the gravity and prudence of older cultures, who have suffered so many terrible shocks in their long history.
The world we live in is a European world. Has it been becoming an Americanized, Hollywoodized world? Might be. However, as long as businessmen wear coats and ties, they are saying, "We dress as Europeans". The Japanese, the Chinese, the Koreans, most of the business people all over the world in fact, wear European dress. This is significant.
In fact, across the world, whatever active, productive people wear, men and women both, is principally European clothes. I realize I generalize excessively - what I am driving at, is that the world today, is a European creation, and that includes the U.S.
It would seem to me, that Europe, after 55+ years of subservience to the U.S. - a childish, upstart nation - is finally "getting its act together". The French and Germans don't love each other, but they detest U.S. domination even more. So the European Union and the Euro is a manifestation of the profound desire of Europe to master its own destiny.
Ortega y Gasset wrote in the 30's words to this effect: Europe is the result of a process that has been going on for hundreds of years, a process of building Europe. Where does it go from here (1930's)? There must be a project, because Europe without a project withers and dies. There is no going back. ("Revolt of the Masses")
Evidently, the European Union is Ortega y Gasset's prophecy come true: the Union, the blurring of borders, with difficulty at first, and finally accepted; and with time, the realization of a great project to capture the European imagination: a United Europe.
The Euro is going to be the world currency, I do not doubt. The American Empire has been squandered by internal divisions which have caused reckless spending and indebtedness, abetted by the use of the Dollar as the reserve currency of the world since WWII - the poison of such a privilege has ruined the great U.S.A. Unfortunately for Americans, their �lite "Wasps" lost their way amid the babble of ivory tower intellectuals, and joined them in their own destruction. We all know the very sad story. The American Empire is going down, but...it may cause a lot of problems on its way down!
As Pandagold has, I think wisely, said, the Euro is being soft-pedalled until it is strong enough to take the brunt of its new mission: the world currency.
Perhaps we may witness, if we live a few more years, Europe regain its old position as the center of the world, as it was before 1914. (One piece is still missing: a European Army!)
Perhaps then the world will be led by a mature, adult Empire, one with well over two thousand years' of history, and not by a childish nation with childish ideals of an absurd equality and unlimited debt for all.
Such an Empire will be sure to reinstate hard currency, a merciless hard currency which will also be a just currency, one that does not dissolve like sugar in the mouth of the saver. Only an adult and mature European culture, one that has taken the hardest knocks of life, can have the guts to prefer justice (and survival!) to weak-kneed compassion (with other people's money, of course!)
I do see some clouds ahead for Europe as head of a world empire: 1. insufficient population growth, excessive entry of non-Europeans into Europe. 2. a question regarding the vitality of Europe - image of Europe as an aggregation of "old people". "Old people" do not Empires make. (However,they can certainly be hardnosed about MONEY!)
That's what I see coming, friends. Maybe we won't like it when we get it. But as Bill Clinton said, "It was a great ride!" The ride's just about over for America.
THEY have evil intentions of taking away our liberty, and THEY are hell-bent at dominating us, and taking away our rights.
THEY use unfair tactics, and THEIR latest efforts fly in the face of our sensibilities.
THEY will lie, cheat, steal, and manipulate us, in order to shove their ideas down our throats.
THEY are untrustworthy, and break their deals.
THEY don't respect GOD.
THEY rip the heads off of poor little kittys.
WE need to mobilize our friends, and do something to prevent an all-out victory by THEM. If WE dont act now, it may soon be too late.
WE are the good guys, who ride white horses and wear white hats.
WE rescue little kittys who are stuck down wells, or up in the branches of high trees.
WE are GOD's favorite group.
We are the side that is right, and so we must detest other peoples with every fiber of our being.
Are you with me in this? If you are not with me, then you are against me. You must take a side, or be left out in the cold. Join US, and then everything will be alright. Join now, you coward!
Prosecutorial Discretion and the Rule of Law @PH in LA, Peter Asher, ALL
I believe they call it "prosecutorial descretion." It means that those in charge get to pick which CASES they will prosecute and which they won't. Like Ken Starr's successor decided Friday not to prosecute Clinton for lying in the Paula Jones case.
But this is symptomatic of a ludicrous so-called justice system that has not only so many CASES they can't even begin to all be tried, but so many LAWS they can't even begin to all be enforced.
Just for example, the Clinton Administration added 870 new pages of regulations to the Federal Register on Thursday, this on top of the 29,000 -- that's right, twenty-nine thousand -- new pages they previously added in the last three months.
So, since it's impossible to enforce all laws and prosecute all cases, Democrat, Republican or Martian, it's ALWAYS a matter of "which laws and which cases will I enforce and which will I ignore?"
Does this sound like the rule of law to you - - - or does it sound more like the rule of men, using arbitrary prosecutorial descretion and an infinite number of laws to punish or reward those they arbitrarily choose to pursue their own arbitrary agendas?
This is what we've come to, and if you're dismayed, it's probably because you watched too many Perry Masons as a kid.
http://www.bday.co.za/bday/content/direct/1,3523,776795-6094-0,00.html Price may be stumbling block in AngloGold-Gold Fields union
MARKET speculation about a tieup, friendly or hostile, between AngloGold and Gold Fields intensified on Friday as shares in both companies rose dramatically.
While a rumoured written proposal by AngloGold to Gold Fields has not been forthcoming, sources have indicated the two parties are in talks.
At one stage on Friday, Gold Fields was up close to 10% on the day before settling back to end at R28,70 a share, up more than 5% on the previous day and more than 15% on its close the previous Friday.
AngloGold gained 1% to R220 a share on Friday.
While a tie-up has been cautiously welcomed by the investment community, the price tag on such a deal has investors guessing and could prove a stumbling block, particularly in the case of a hostile bid.
A rumour that Barrick Gold could partner AngloGold in the deal has gained credibility, given Barrick's strong balance sheet and overseas operations which create dollar revenue and profit.
Gold Fields is valued at more than R13bn by the market. A hefty takeout premium would have to be made for investors to consider an offer, with most of them seeking cash rather than shares due to their exposure to both companies, and their wish not to overexpose themselves in either the equity or gold sector.
An offer of R20bn in cash would be inconceivable for AngloGold on its own at present as the group's gearing is at its highest yet.
Some of its debt is also dollar- denominated, meaning that against a weakening currency, AngloGold could become overgeared in spite of improving overseas operations helping its offshore cash flow.
An analyst said AngloGold could look to its parent for help, but it was unlikely that Anglo American would want to be part of such a deal. It was, reportedly, the Anglo American nonexecutive directors of AngloGold who voted down a proposed hostile bid by AngloGold for Gold Fields last year, underwritten by Chase Manhattan Bank, when it seemed such a bid was forthcoming.
The analyst said his reading of Anglo American's plans was that it was too heavily invested in gold as things stood. Apart from its 54% stake in AngloGold, the group also has stakes in Avgold and Western Areas.
While he agreed that Anglo American did already have a stake in Gold Fields, he said it would make more sense for Anglo American to sell this stake, valued at about R2,2bn, to an offshore company such as Barrick if the company was indeed looking for SA assets.
Anglo American would earn dollars for this stake, which could be used to expand its growing base metal operations.
Ok, (against a rising POG) let's see Randy!
For some reason yet to be made clear, the sale of 25 tons of Au from the BoE is more often than not preceded by an up-tick - and the price "settles" shortly after. Why this is so is a mistery to me as the daily t/over at the LBMA is MANY multiples of the aforementioned 25T.
The first indication of a future physical/paper de-couple perhaps! View
Yesterday's Discussion.
...POG Contest Entry...ThaiGold is going to guess the closing price of the Feb Gold Futures Contract
as of Friday, January 26, 2001 will be:
>>>========= $275.00 ==========>
And here is why I believe that:
Gold (paper gold) futures contracts have been the tool-of-choice for several
years by those who would "manipulate" the Price of Gold (POG) down. There are
myriad different theories who, where, and why is/are responsible for doing so.
Indeed, some even theorize that it is *not* happening whatsoever.
I have my own distinct theory, and it is a contrarian one. Not mainstream.
Many months ago I mentioned it in one of my "PATSY Index" posts herein. It
was ignored by everyone.
But I tried again, to put it forward to the Forum, in a different way, several
weeks ago. Maybe you remember: It was a two part Essay, sort of a parable/story
of "Phantom Thai Rice Merchants". And again, nobody commented one way or the
other. I guess they didn't get it. I am not a very good writer. Mea Culpa.
Okay. Here's my theory, in a black-n-white nutshell:
If you were a super-rich person; entity; or group; who preferred to have the
majority of your income and/or wealth in the form of solid gold, you would
need to purchase it somewhere. From a market. Typically, a Futures Market or
in bigger chunks, from the LBMA (London Bullion Merchant Association).
And, since initially your income is derived from US Dollar payment sources;
and you feel you are not getting fair value for your sold-product; and if you
wish to maximize your gold-exchange quantity for those (unwanted) US Dollars;
and if you already (accumulated over the years) have a great amount of gold;
it would be to your great advantage to use some of your accumulated gold, to
(in a fully legal manner) "flood the market" with it; to drive the price of
gold down temporarily; and then jump in at the low-point and buy back your
"flood" gold *plus* the next increment of new gold which you are wishing to
purchase, at the lowest possible price.
It's quite easy, because of the "sell stops" used by futures traders and
speculators. Once you flood a little bit into the market, it trips the sell stops, and those other traders must sell out their positions to prevent
further losses. And so the price snowballs lower. And lower. And lower.
There's also a BandWagon effect whereby astute traders and "conipulators"
consort with you, and amongst themselves, to participate likewise at the
same lucrative and insider-knowledgeable timing points. It's just so easy.
At that target point, you reverse your selling flood and start buying gold
discretely, in modest chunks until you have reached your gold goal. And then
you repeat the process a few days later when you need to repeat the whole
contrivance for the next product-to-dollar-to-gold "exchange".
That would take a lot of US Dollar money wouldn't it. Yes. And who has such
great quantities of income-money, on a regular basis.?. Answer: OPEC & DRUGs.
I have noticed a correlation between the price (lowering) manipulations of
the gold market: Seems to parallel the price/income graphs of Crude Oil prices
and the resultant up-n-down income that OPEC members would derive from that.
Put two and two together, and it makes sense. For them. But not for GoldBugs.
As for the Drug Trafficking monies, I have no charts nor direct knowledge of
magnitude nor ups-n-downs of that income. But I'm certain it's there, and is
affecting the gold market(s) in similar ways. And just as frequently.
But wait... "The Rest of the Story" (to paraphrase Paul Harvey): Just as in
my two-part Phantom Thai Rice Merchant parable, the plot thickens. There's
more to it. A lot more. ... Spawned by the above. And I wish to continue
this theory in a second installment, which will be (if MK/USAgold allows)
the basis of my Contest Entry Essay for the second-part of this Contest,
(in a later/subsequent post) with the subject line:
"**** 2001 -- A Gold Market Odyssey ****"
So watch for it, coming soon.
Hence, at this point in time, I feel the POG will languish within it's
normal (manipulated) range, with some slight upward pressure due to the
new Bush Administration taking over the reigns of power/Treasury/etc.
My theory encompasses US Government cooperation(s) with some or all of
the above, to have allowed it to thrive for so many years. And it involves
a whole slew of jump-on-the-bandwagon Banks, Brokerages, Bullion Banks,
and Central Banks. It's a real Can of Worms.!. Trust me.
I hope this finally makes sense to the Forum members. If not, I'll try again
some other day; some other way; some other Contest.
... Close Only Counts in HorseShoes ...Hi Topaz:
Whatta ya mean "the closest" .?.
I'm way outta range, aren't I.?.
Hey guy.. did you checkout my website yet.?.
http://users.sisna.com/ThaiRanch/EagleRanch/index.htm
It's written in AuzzieGlish. You can handle it.
Hi Randy:
Maybe you can post a listing of what guess's have been made
so-far for the benefit of others coming along, so as not to have
them inadvertantly overlay the same POG guess figure.?.
Wow! I leave for a couple a days to Whack Ducks, and the place has gone bonkers!
MASONIC BIBLE?
The bible that some refer to as the "Masonic" bible, is none other than the King James version that was used during the inaugurations of George Washington, Thomas Jefferson, and Andrew Jackson, among others. Funny thing though, I don't ever recall there being a "Masonic" bible. I guess by Masonic brothers just have kept me "out of the loop" on that one. ;-)
Before you know it, someone will claimed that I'm "Illuminated?" Whatever the hell that is.
FLORIDA ELECTION
As far as the election results are concerned, the Florida count was amusing and the Demopublicans waged war on each other over "chads." No one seems to bother to mention that with the recount in Palm County, and the recount by the press in Miami-Dade, it appears that George Dubya is the winner in spite of the oppositions legal battles to disenfranchise the military vote and all those who did not vote in the western part of the state because the press informed them that the election was over for Florida even though the polls weren't closed. Then again, the opposition is not too keen on having the results of the 3 million absentee ballots revealed either. The absentee ballots are generally military and ex-pat business people, and they lean heavily toward Bush's crowd. Also, we are supposedly a Representative Republic and not a Democracy as some would like to think. Thank God! If we were a Democracy, then those of us in the greater landmass of the US with smaller populations would have the Grasshoppers run roughshod over the rest of us. As far as I know, there never has been a true Democracy except some feeble attempts in Ancient Greece. Even then, they failed miserably as the people realized that they could vote themselves the stores of the treasury � which they did. End of story.
BTW, I liked the various methods of protest by the protestors at the inauguration as they provided some comic relief. I especially liked the naked chick with the sign around her neck "Fur � Not Bush." Hey � what can I say, I'm a hetero kind a guy.
PH in LA: This Al Gore fella, he's a friend of yours? Personally I hate all scumbag politicians, but then I have always thought that there was something seriously-fundamentally wrong with people who wanted to rule over the lives of others. But then, that's just me. I mean, there is a fundamental weakness in people who "need" or "desire" someone to rule over them. That is the reason why I have a difficult time understanding the Brits. Why would a people want to be ruled over by a family of inbreds for several hundred years - generation after generation? Why they had a perfect chance with Cromwell to change things. Go figure! I guess when that question is answered, then we will know why Americans are so passionate about having scumbag politicians rule over them. The way I see it, the only difference between the Demopublicans is that the Democrat side wants control how I make my money, while the Republican half wants to control what I spend it on.
Oh yeah, BTW, there was a "Got Milk" commercial in the works starring the Democrat pin-up girl Monica Lewinsky, however, it was pulled because some took offense. Personally I find the very thought of this chick with a milk moustache as being quite hilarious given the circumstances.
Natural Gas Supply Issue Reaches Crisis Level: Suppliers Have Said They May Pull Up to Two-Thirds of Needed Gas Due to California Energy Crisis
CONTACT: PG&E News Department (415) 973-5930
SAN FRANCISCO - Pacific Gas and Electric Company has been notified by six of its natural gas suppliers, accounting for 36 percent of daily supply, that they have stopped, or may stop delivering gas by January 23. In addition, several other suppliers, accounting for another 30 percent of daily supplies, have told the utility that they are considering stopping deliveries.
The withdrawal of gas deliveries brings Northern and Central California close to the brink of natural gas shortages in the middle of winter, which could threaten the health and safety of millions of Californians. As a result of these withdrawals, natural gas could be cut to homes, hospitals, businesses, refineries and power plants.
"As California continues to struggle with an energy crisis and the financial havoc it has created for the state's utilities, we face the very real possibility of natural gas shortages in the coming weeks," said Gordon R. Smith, president and CEO of Pacific Gas and Electric Company. "We have done our best to call attention to this crisis and obtain assistance to avert a catastrophe, and now we must wait to see if the state and federal governments will step in to ensure that natural gas flows to homes and businesses in Northern and Central California."
Pacific Gas and Electric Company has taken a number of steps to try and avert the looming crisis. The company:
Informed Governor Davis of the problem on Jan. 9 and asked him to consider using his emergency powers to help avert gas shortages by providing short-term financial assistance so gas suppliers will sell to the cash-strapped utility.
Met with its 25-30 key suppliers on Jan. 10 to urge them to continue to deliver gas under normal payment arrangements.
Requested on Jan. 12 that President Clinton declare a natural gas supply emergency.
The suppliers which have withdrawn supplies as of Jan. 17, or have stated that they may pull supplies in the coming days, include two of Pacific Gas and Electric Company's largest suppliers, J. Aron & Co., the trading arm of Goldman Sachs in New York, and Sempra Energy Trading of Stamford, Connecticut. The other suppliers are Western Gas Resources, Inc. of Denver; Duke Energy Trading of Houston; Coastal Merchant Energy of Houston; and Natural Gas Exchange of Calgary, Alberta. The situation has occurred because Pacific Gas and Electric Company could not pay in advance or on delivery, a significant change in payment terms demanded by suppliers. The company has exhausted its cash and credit because of the high wholesale electricity prices in California.
To cover the shortfall caused by the pulled gas supplies and the fact that other suppliers will not sell to Pacific Gas and Electric Company, the utility is quickly depleting its natural gas in storage. The stored gas is expected to be depleted by early February if the current rate of withdrawal continues. If more suppliers stop their deliveries, the utility's stored gas will be consumed more quickly.
In addition to the immediate crisis created by the halt in gas deliveries, the company has been able to purchase only about 60 percent of the gas it expects customers to need each day in February. Therefore, an even greater crisis is expected in February once storage supplies are depleted and inadequate supplies are flowing into the state.
If Pacific Gas and Electric Company is not able to obtain enough gas for residential and small business customers, the rules of the California Public Utilities Commission require the utility to divert gas from noncore (large industrial) consumers, among which are power plants that need natural gas to generate electricity. However, the result will be an even worse electricity shortage than the state is currently suffering. Some power plant operators have stated that they will send their gas out of California to prevent it from being used by residential and small business customers. Other noncore customers whose gas could be diverted include hospitals, military bases and universities.
"Diverting natural gas from some of our customers in order to serve others is not an acceptable solution, but we would do it in order to preserve gas for our residential customers who need heat in the middle of winter," said Smith. "What we need is for gas suppliers to continue to sell their gas to Pacific Gas and Electric Company on regular terms, and with an ordinary payment schedule."
Black Blade: There were more blackouts today in northern Kalifornia. Apparently a major transformer could not handle the load and popped. Looks as if the infrastructure is giving way now. Now cash reserves ($12 billion)of the Peoples Socialist Republik of Kalifornia are likely to be exhausted as Commissar Davis signs away cash to bail out the Republik's Utes. They now are trying to build some power plants. I will go out on a limb here - I would guess that they are powered by what? - Natural Gas? - Oh Boy! Life is about to become very "interesting" for the Grasshoppers. "...And the Grasshoppers danced, sang, and played all summer..."
D-uh, my mistake, I misread the figure!
Yes, I looked the other day - most was "under const'n" will go back as time permits.
How did the babyphoto turn out?
http://biz.yahoo.com/rb/010121/o.html By Nigel Hunt
LOS ANGELES (Reuters) - California suffered its third series of blackouts in less than a week on Sunday, with some customers of municipal utilities in the northern half of the state losing power for about 20 minutes, according to a statement issued by California's electric grid manager. The latest outage, affecting around 120,000 people was far less widespread than blackouts on Wednesday and Thursday, both of which cut off about two million of the 34 million residents in the nation's richest and most populous state. The California Independent System Operator (ISO), which manages around 75 percent of the state's power grid, said the outage was caused by transmission problems which originated at a substation around 90 miles east of Portland, Ore. ``The California ISO does not forecast further outages tonight, but is keeping a close eye on any transmission problems,'' the statement said. All three series of blackouts have only covered northern California with customers in the south of the state yet to experience any service interruptions.
Earlier Sunday, the ISO had said it expected to squeak through the next couple of days without further rolling blackouts, with some of the state's aged fleet of power plants poised to return to service. The state is suffering a chronic power shortage which has its roots both in insufficient supply and in a credit crisis caused by the near bankruptcy of its two leading utilities. To meet demand, California utilities have been forced to pay skyrocketing prices for wholesale electricity on the spot market. But they are not permitted to pass through their full costs to consumers under the state's 1996 deregulation law. The burden has taken San Francisco-based Pacific Gas & Electric, a unit of PG&E Corp., and Edison International unit Southern California Edison, which is based just outside Los Angeles, to the brink of bankruptcy.
Democratic Gov. Gray Davis, although still generally popular, has been targeted by critics who believe he has not acted decisively to tackle the state's chronic power shortage and the near bankruptcy of its two largest utilities. ``He is looking for a solution that will work, not a solution for the moment. He wants legislation that is going to fix this once and for all,'' Davis' spokesman Steve Maviglio told Reuters on Sunday. The state's two main utilities have seen their debt ratings cut to junk status. Power sellers have been reluctant to do business with them, exacerbating the shortage of electricity. Last week Davis signed legislation which allocated $400 million for the California Department of Water Resources to buy power on behalf of the utilities and their 24 million customers who account for 70 percent of the state's population.
In a poll published late last week, the Public Policy Institute of California found that while Davis received a 63 percent approval rating as governor, a clear majority of 62 percent disapproved of his efforts to solve the power crisis. The findings mirrored similar results from a Los Angeles Times poll published earlier this month. Maviglio said the governor was continuing to hold talks over the weekend with state lawmakers and his staff. They are trying to design an auction at which the state would receive offers from power producers to buy electricity under long-term contracts.
Electricity can be bought much more cheaply through long-term deals. Many expect prices to fall significantly when the current chronic shortage starts to ease after the summer of 2002 as planned power plants come on line. California's power problems are also rooted in the absence of any significant new plant construction during the last decade, partly due to uncertainly connected with the state's much criticized deregulation legislation. Maviglio said Davis hoped to finalize the auction scheme by the middle of the week. He noted that Davis has also talked of appointing a ``power plant czar'' to speed up the construction of new plants. Many of the state's plants are currently more than 30 years old and have been breaking down with alarming frequency. ISO spokeswoman Stephanie McCorkle said by Monday around 9,000 megawatts or one-fifth of all available power would be off line, well below the recent peak of about 15,000 MW and also significantly below the 10,700 MW which was out of action on Friday. One megawatt is enough to supply around 1,000 people.
The ISO extended a so-called stage three emergency through midnight on Monday, its highest level of alert and one that is called when reserves drop to around 1.5 percent of demand, considered a critically low amount. McCorkle noted that the ISO temporarily lifted its stage three alert on Saturday morning but was quickly forced to reinstate it. ``We had some rough moments yesterday morning,'' she said, noting that lifting of the stage three cut off the flow of electricity from some key suppliers in the Pacific Northwest.
``The Northwest doesn't have that many megawatts, so California does have to be on the brink of blackouts to get that power,'' she said. Wholesale prices in California started to soar in late spring with supplies struggling to keep pace with surging demand linked to a buoyant economy and growing population.
Black Blade: Seems as if it is northern Kalifornia that is "sacrificed" for southern Kalifornia (where the most votes are). Ever watch a Clint Eastwood "Dirty Harry" flick and notice the slimey liberal politicians trying to be all "Fuzzy and warm" toward the criminal element? Now just try to imagine these "freaks of nature" trying to solve an energy crisis � something well out of their area of expertise. I would love to be a fly on the wall during those proceedings. Commissar Davis has now appointed a "power plant czar" � sounds like a "man with a plan." ;-)
Looks as if Hydro-Carbon Man is about to get a life lesson in reality. "And the Grasshoppers played, danced and sang all summer�"
A massive fight over development of Florida's natural gas fields is likely to be one of the first big environmental tests of the new Bush administration. The reason: George W. Bush's fervent support for domestic energy development would appear to be a direct conflict with his backing for states' rights -- given that Floridians, including the president's brother, Florida Gov. Jeb Bush, have opposed the project. ``That hasn't changed,'' Elizabeth Hirst, a spokeswoman for the governor, said this week. The controversy concerns the so-called Destin Dome, 25 miles due south of Pensacola's beautiful beaches in the Gulf of Mexico. Chevron, which leased the Destin Dome from the federal government years ago, has determined that the area is one of the richest natural gas fields in the country. Chevron lacks only a green light from the U.S. Secretary of Commerce to begin production. It failed to get one in the Clinton years, however, in large part because of Florida's opposition.
http://washingtonpost.com/ac2/wp-dyn/A23628-2001Jan20?language=printer Re >>> the Clinton Administration added 870 new pages of regulations to the Federal
Register on Thursday, this on top of the 29,000 -- that's right, twenty-nine thousand -- new pages
they previously added in the last three months.<<<<
Bush Scrambles to Block Clinton Rush Orders
By Eric Pianin
Washington Post Staff Writer
Sunday, January 21, 2001 ; Page A18
Under orders from Bush, White House chief of staff Andrew H. Card Jr. instructed the Government Printing Office to halt publication in the Federal Register of any new rules "to
ensure that the president's appointees have the opportunity to review any new or pending regulations."
Final regulations have the force of law once they are printed in the Federal Register, the government's official organ. The new administration also issued a 60-day stay on regulations that were published in the register but have not yet taken effect.
"The whole myriad of regulations he signed while he was walking out the door should be looked at," said Senate Budget Committee Chairman Pete V. Domenici (R-N.M.). "Clinton had four years of a second term to do some of those, and because he does them all right now makes them all suspect."
Hi Steve,
Just as a bit of side info, it was reported in the Press over the w-end that plans are afoot to roll back the "gun control legislation" (at least here in N.S.W - Au.) due to growing conserns re: Home invasion and several cases where Criminals ended up suing Victims for injuries received "during" the crime. The Aust wide controls were put in place following the Port Arthur Massacre where 18? people were killed by a lone Gunman.
Nobody, NOBODY! condones that sort of behaviour - but we as a country, having experienced several years of prohibition, are again coming to the conclusion that the protection of life and property is sacrosanct in society and ALL methods to achieve this must be at the disposal of the populace.
... Contest Essay ...Looking up "Odyssey" in my WebSite's Dictionary link, it brought forth:
[quote]
od�ys�sey n., pl. od�ys�seys.
(1) An extended adventurous voyage or trip.
(2) An intellectual or spiritual quest: an odyssey of discovery.
(After the Odyssey. a Homeric epic recounting the wanderings of Odysseus
after the fall of Troy. From Greek Odusseia; From Odusseus; Odysseus.)
[unquote]
And, as I recall, "2001" is the true beginning of the new Millennium.
So that's an apt combination of words to fit an Essay around. Since we as
a specie, are now embarking upon an Epic Journey. Into unknown waters. And
into unknown times. Yet we know that history always repeats itself, and
there's the old adage that "The criminal always returns to the scene of the
crime". Hence, maybe our Journey will just be a RePlay of the same old stuff.
Yes. I believe that. The same old stuff. Manipulation of the Price of Gold
(POG) downward, but within a "range" that suits the manipulator's needs.
Manipulators.?. Some believe there are none. Ostrich-like. Head in sand.
Others, like GATA (Gold AntiTrust Action Committee) have done incredible
in-depth research, and have come to their own conclusions as to who is
behind the manipulations, and why. GATA refers to "them" collectively as
"The Cabal".
Myself, have a somewhat different theory on the whole affair. It includes
many of the players that GATA is targeting, but not for the reasons that
GATA has concluded. Nope. I have different reasons. And most of them appear
borderline "legal". Or very hard to prove. I wish GATA the best, but believe
they may be frustrated with their eventual (court) results, or, at worst,
simply Barking Up the Wrong Tree. But this is not an Essay about GATA.
My basic theory was recently outlined and posted as the first-part of this
Contest. In post: ThaiGold (01/22/01; 00:55:34MT - usagold.com msg#: 46112)
In that post, I explained that it would seem to be an easy matter for some
super-rich entity or group to manipulate the POG downward, using the COMEX
Futures Market and LBMA (London Bullion Merchant Association) for example.
Sell-Stop orders are routinely placed therein (COMEX) to protect holders of
Contracts against adverse down spikes. If a sell-stop is triggered, it sells
gold into the market. Paper gold. But still considered as gold. Deliverable
gold, if/when push comes to shove.
Such entity, if they owned enough of their own gold (to backup their paper
sell contracts) could flood the market with gold, at any time, in virtually
any amount, and drive the POG downward. Way downward. Again and again.
Then, at the target low point, begin discretely buying back their flooded
gold, and at the same time buy whatever additional gold they wished. At the
lowest prices imaginable. A bargain. A contrived bargain. A legal bargain.
Why would they do this.?. Because they have too much paper US Dollars on hand.
And they don't trust paper fiat money. Can you blame them for that.?. I can't.
How do they get so many paper US Dollars.?. That's easy: From selling their
product. What's their product.?. Answer: Oil. And Dope. Lotsa money in both.
Not the same people. Until they begin the Futures Manipulations. At that point,
it becomes a symbiotic relationship between all kinds of famous entities. Sort
of a "You scratch my back, and I'll scratch yours; and then I'll try not to
stab your back before you don't stab my back" relationship. Rather fragile.
Yet paradoxically, rather robust. It has thrived for years. Since January 1996
by my best estimate. Look at the long term POG charts. It's plain as day when
it all started. The first week of January, in 1996. See for yourself.
Next, there is a BandWagon effect: The OIL cartel, needs to do their thing via
established market participants. Big Banks; Brokerages; Bullion Banks; and with
the help of (wink-wink) various Central Banks; Government regulators and indeed
perhaps Government officials at the highest levels. Example, the US Treasury
Department via the ESF (Exchange Stabilization Fund). They have lotsa power;
connections; and liquidity (both gold and paper US Dollars) with which to back
all the other members of the manipulation machine. Let's call them what they
are: "Insiders".
Nobody is always perfectly honest. Most everyone has their price. Or at least
has an agenda; or marching orders from someone else (higher) so-inclined. And
everyone likes to make a Fast Buck. (Except me, of course. And ...er ... You.)
These then are the BandWagon Manipulators. They (using their insider knowledge and connections) often FrontRun or parallel run the original Cartel's flooding
of the markets. Why don't the Cartels complain.?. Because the FrontRunners are
helpful in flooding the market with more paper gold. So we have three (or more)
floods coming into the markets regularly:
(1) The Cartel, trying to do their thing: Oil-to-Dollars-to-Gold Exchange.
(2) Market speculators being Sell-Stop-Lossed out of their "Long" positions.
(3) Insider FrontRunners, always ready to ride the BandWagon in the gold flood.
That's quite a lot of gold, coming into a market, even if it's paper. Then, add
to it all the craziness of paper gold options, puts, calls, deltas, derivatives
and who knows what else they can invent. All very profitable. If timed right.
The Trend is Your Friend. Theirs too. And they know it. But you don't. So easy.
Who establishes the (down) Trend.?. They do. You wanna buck that Trend..?. No.
Hence, as I see it, the year 2001 is going to be mostly more of the same. It's
been very beneficial to the US economy by making the POG appear lower. And
that's an "indicator" of non-inflation. The Government loves it. So they look
the other way. Or even assist. It's a very interwoven symbiotic symphony. All
of them playing the same tune. All of them sharing in the ticket revenue.
Most in this Forum would agree, that the previous (Clinton/Rubin/Sommers/FED)
administration used every trick in the book to contrive the stock market
bubbles; issued fake CPI numbers; and pumped up liquidity; interest rates and
whatever else they could dream up to make the economy look good. For them.
Now we have a new (Bush) Administration. A new Treasury Secretary. But the same
FEDeral Reserve Bank Chairman (Alan Greenspan). The SEC and CFTC will be lap
dogs as usual to their friends in high places. Mostly the FrontRunners, and the
FED and NY FED honchos. One big happy clique. Don't rock the boat. Be as fake
honest as possible. Deny everything. Look the other way. Rake in the Bucks.
Musical Chairs. House of Cards. Call it whatever you like. But it will continue.
GATA feels there's a huge "Banking Derivative Crisis". They are probably right.
The whole thing is so intertwined and crosslinked that if it comes apart at any
seam, it'll look like Championship Chinese Dominoes. Zillions of them. Poof.!.
So my "More of the Same" projection has that Caveat. If the whole thing blows
up in their face, there may be no way to save any of it. A worldwide calamity.
Financial volcano. It could blow at any time. Be prepared. Get physical gold
while you can, at todays faked low prices. Bargain of a lifetime.!.
And for sure, Silver too. Because the only thing, ONLY THING, that can put the
world's economies back together will be a Hard Currency Standard. That means
Gold and Silver coinage minted and circulating as Legal Tender once again. And
Redeemable Gold and Silver Certificates. And redeemable Gold and Silver digital
money. And sensible, limited, tightly controlled Bank Credit expansion based
upon it. Like in the old days. The previous Millennium.
Will all this come about within 2001.?. Or within our lifetime.?. Answer: Yes.
Now you have been alerted. I told you so. Will you believe me.?. Answer: No.
"Odyssey"
(1) An extended adventurous voyage or trip.
(2) An intellectual or spiritual quest: an odyssey of discovery.
All aboard.!. Hoist the Main'sl. And the Mizzen.
(3) Gold and Silver is your lifeboat. Get some. Get more. In 2001.
PMs are still looking good this morning though gold has pulled back from being $2.00 higher to now only $1.10 higher. NG is higher, though oil is down. Today is the first day on Wall Street with GW as Ruler of America. We shall see how the market reacts. So far the USD is higher and the Euro is looking more like toilet paper.
Anyway, long weekend, whacked some ducks, drank much Anchor Steam Porter,and now time to catch some ZZZZZ's.
You got most of it right. You fouled up a bit on the �US� (as in �we� not USA).
In Yorkshire (England) they have a saying, which in the vernacular goes - There are two Yorkshire men ( old friends) philosophising about life and people in general as they sit on a park bench. Then, after a pause for reflection, one turns to the other and says � " All people are a bit strange, Jim, �cept me and thee. And, come to think of it, there are times when I'm non too sure about thee."
And a little further north, just across the border there was Rabbie Burns who wrote (in the slightly adapted Scots vernacular) "����..Oh would some power the gift to gie (give) us, to see oorselves as ithers (others) see us, it would frae mony a wrong turn free us, an foolish notion."
In our maker's eyes we must all fall well short of the truly �good�. Man is pretty rotten; it is just that some of us are worse than others.
Joking apart. I know what you are getting at in this posting, and it really depends whether you believe the market is operating under �free market� forces, or there is another organised force at work that has its own agenda.
It would have to be a powerful, organised, and disciplined, force (network); no individual could do it. But if you think the market is acting freely, well, I suppose you are in a lot of company, because if there weren't enough na�ve people, �they� could fool, �they� wouldn't have been able to get away with it.
... Remembering Old Times ...I'm just sitting here, thinking about all the complexities of what
our new President must be going thru. At this Change of Shift.
Way back about 40 years ago, I had a part-time job to tide me
over somewhat. Between professional careers. It was as the
Graveyard Shift (MidNite to 8 AM) Nite Desk Clerk at a small
but (of course) reputable Hotel.
At Change of Shift, when I came in to takeover from the earlier
guy, the Swingshift (4 PM to MidNite), the order of business
was to "Count the Till". ie Inventory all the cash and coins in
the cash register. Because I was responsible for it all, and the
tally into the next shift (DayShift) had to talley with all the nite
receipts plus/minus the Till Cash.
It was a slow, carefull process. At each end of the Shift. There
might be a discrepancy of a few cents, maybe even a buck or
two. A reCount ensued. And one more, if still unresolved. If
it still didn't balance, one or the other of us simply dipped into
our personal cash and tossed it into the Till. So we could go
home or get on with work.
So, I'm wondering: Will GW Bush Count the Till.?.
The one supposedly at Fort Knox.?. All of USA's gold.
And what if it doesn't balance.?. Or is mostly (horrors) gone.!.
And who could be trusted to do such an Inventory.?. I mean,
whom would we, The People trust, to really tell us the Truth
as to whether any of our Gold's still in those vaults. Afterall,
it would be quite a shock to the American People. Would they
tell us.?. I doubt it. One of life's cunundrums. So why count it.
"Well guess what, folks? Humans have fallen for government. We have lost our
self-esteem; we simply do not believe humans can treat each other with civility. We tell
ourselves it's "human nature" that causes wars. Sure, in a perfect world, there would
be no famines, but we have to accept reality, right?
"Nope. Governments start wars, not civilians. Murder is no more "natural" and thus
inevitable than dying from hunger or tuberculosis. As a society, we can take definite
steps to greatly reduce the incidence of all of these things. It's true, we mustn't
proceed through "scientific" management of human affairs, but rather allow the free
market system to foster civilized behavior.
"(Ever notice that famines never happen in the capitalist countries? When the US gets
hit with a drought, the news features some impoverished farmers. When a socialist
country gets hit with a drought, people start dying in droves.)"
"Just as recovery can only come when the abused woman stops denying her own
responsibility for her horrible life, so too will we stop wars and famines only when we
admit that humans have been living a tremendous lie for thousands of years.
"The truth is scary. It is simply awful that all of this suffering around us is largely
preventable. I understand that. But we must have the courage to accept this truth, to
stop the cycle.
What if the Government decided to issue 8 Trillion Dollars
worth of Gold Backed Currency. Backed by the supposed
Gold in Fort Knox. Yet there was actually no gold there. Gone
and vanished somehow. Yet the Government wouldn't, indeed
couldn't let anyone know that.
So the Big Lie. It's in there. trust them. Trust these new Gold
backed currencey certificates.
What does that leave us with.?. Fiat Gold Currency. Because
the Government decrees it. DeJaVu allover again.
Dare I say it.?. Of what value then is Gold in the Government's
non-credible possession.?. Answer: None whatsoever.!.
Soloution: Mint the Gold. Into Legal Tender coins. Only then
would it serve any usefull purpose. Isn't that Ironic.
As I come from a maritime nation, may I be forgiven for using the occasional naval; analogy and context in my postings to support the point being made.
At the start of this new millennium and a new US president's term of office, it is my feeling that we are about to steer into very turbulent waters.
This should not be daunting; it should be viewed as exciting. However we need to know about, and understand the elements, like any good sailor, such as tides, weather, water depth etc. Mind you, if �investing� (I use the term, here, liberally), we should always have knowledge of these. In the stock markets these �elements� are � Media attention, volume, company fundamentals, shares behaviour within its peer group, past performance (chart
Pattern), money supply, interest rates, etc., etc.
If going into battle, then there are other things we need to know - where is the enemy, how strong is the force, in which direction is it moving and why. Then there are not only surface ships, but there are underwater craft, planes, and possibly mines, all there to trap the unwary � I think you are by now beginning to get the message.
The stakes being fought for in those financial markets ( all the markets) are greater than any naval battle ever fought. (Do you know how much money is involved?) Never forget, that for anyone to gain someone must lose � the markets do not generate money � only transfer it from one greedy little paw, to another.
We were able to land on those Normandy beaches with the largest armada in history, and suffer, comparatively few casualties against a well entrenched enemy because we fooled him into believing the landing would be at another point. He was kept guessing from expertly put out misleading information, and movement.
Why on earth can some of you only see the importance of this in one context, yet doubt, or disbelieve it in another? This is what really baffles me. Wake up guys, hoist your sails, splice your main brace, strike your colours, and feel the salt spray on your face.
Where was I, I get carried away when I hear those creaking decks, and see those guns bristling for action. Ah, yes � we are entering turbulent waters, and there is an �enemy� out there � one who wants to take your booty and send you to the bottom.
I read in someone's post the comment re this morning's data that was up a bit, then down a bit, and that the euro looked like toilet paper�..bla ..bla. The object my friends is TO KEEP YOU GUESSING. I repeat, TO KEEP YOU GUESSING. That's the way battles are won.
You have to get into your enemy's mind in order to out guess him. You need to know the overall plan. What is the real objective (agenda), find out, then you will know the trend.
The trend of the euro is UP. The trend of the dollar is DOWN. Will it appear that way � NO! Otherwise it would be easy. We could all run and mortgage the home and stick it all on euro long positions. It is the same with anything in the markets. The trick is to fool you.
There is no struggle between the dollar and the euro. The transfer of power is an arranged one by the only people capable of arranging it.There are very good reasons for this which I could explain, but you should be able to see yourself. The transfer has to be gradual - the boat cannot be allowed to rock. There are good reasons for this - which you should also be able to see, and understand.
For gold, or anything, to be allowed to take away the food supply to the euro, as I have explained before, would be a disaster for the experiment, and for the hoped for, 'soft landing'.
Stop worrying about this, or that was up a dollar, or down a dollar � or you will go stark raving bonkers. Identify the trend (current and wind direction), and remember, always that you are up against a cunning and experienced enemy who knows the waters well, and if you can't see to get into his head, he can into yours. He knows exactly how you will react to his every move; you are predictable.
Please excuse the occasional errors as I am a terrible typist, and have no time for editing - got to go aloft to the crows nest to keep watch (the markets.)
This maybe the time when the ball start rolling - the contrary indicator.
Ultimately, the fundamentals have to take over, not the maneuvering of the financial houses and the banks that will prevail. The gold is well price now for the studied investor. When you buy the gold now, you likely to make a substantial profit over the next seven years, diversification is the answer.
Historical note; The last time the Bank of England sold a substantial amount of gold was from 1965 to 1971, when the price was pegged by the US government at $35 an ounce. They sold 1300 tones - two thirds of their holdings. Nine years later, gold reached a record high of $827/oz."
http://users.sisna.com/ThaiRanch/EagleRanch/fivestar.htmHi Pandagold
Your "Entering Troubled Waters" post gets a Five Star Award.
(That means I liked it, and was of the highest quality.)
Congratulations. It's the first one.!.
ThaiGold
The German Prime minister and equivalent of secretary of state are advocating less German national soverignty and a European Constitution.
The Germans were also the force behing the Washingtom Agreement if you recall. Europe is headed for unification and the EURO is the glue that helps bind them together.
There's no 'BUT' friend, or should I say 'matie' Whirlpools are all part of the elements and natural (and un-natural) forces, of which any 'sailor' should be aware. (But don't whirlpools suck you in, not turn you around?)
My satire was only about how it is that we are massaged into hating others, and so to divide the people inot little groups, using distortions, and fear. This technique is used to keep the people divided, so that may not form a collective fist, and thereby assault the forces that keep them enslaved.
The term "US" was not meant as an abreviation for the United States, but was intended to refer to any side of any group. I was trying purposefully to avoid any reference to any actual group, and show that the forces of propaganda that exert influence on the people actually use the same technique to align all citicens, no matter what their group is.
As long as we are divided, the staus quo is preserved.
Thanks you for your response.
I remember my parents saying that very same Scottish line, but now you have given me the rest of the line that was missing. Very good!
A contest is afoot! Notice is served to those just now arriving from afield to our Round Table...DEADLINE: Tomorrow Midnight MST
*REPOST of contest details*
USAGOLD (1/19/2001; 11:27:32MT - usagold.com msg#: 45919)
Hear Ye. . . .Hear Ye. . . . A Call to Contest. . .
A test of your thinking, predicting and posting skills to occur from now until midnight (MST) on Tuesday, January 23rd. We stand at the first month of a new millennium, a time to stop and think what the future might bring. So the contest is simple as it is challenging:
To wit: Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion. We stand at a threshold -- not just of a new century but a time of uncertainty as the winds of change sweep through the world economy. There could be no better time for a contest with such a theme than now.
Your post must be at least 30 words and it must contain in the subject box the following:
**** 2001 -- A Gold Market Odyssey ****
(Surrounded by stars as shown....to help get our attention when we gather the many entries together at the deadline.)
The prize will be a .1867 ounce pre-1933 French Rooster gold coin. There will be two runners-up who will receive a one ounce silver Eagle each.
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner of will be the one whose arrow falls most closely to the mark, and shall be rewarded a tenth ounce prize that shines with the light of gold. All price guesses must be accompanied by sound reasons for your prediction to gain the prize. And as has been done it the past, it would please our judges if you would use standard arrows in the subject line of your post when you take aim to enter this 2nd contest. Like this:
>>>========= $300.00 ==========>
Also, all first-time posters will be awarded a one ounce silver Eagle if you post during the contest period -- from now until Tuesday midnight, January 23rd, 2001.
To qualify for the prize, you must e-mail jill@usagold.com confirmation citing the message number once you've made your first post. We will check each first-time poster's claim, so don't feel like you can get one by us.
We wish you good luck, good fortune. . . . . .And. . . . .
Message for our weekday visitors who do not or can not join our weekend Round Table discussions
http://www.usagold.com/onlinestore/special.htmlMichael has sent word that the gold 10 Guilder young Dutch queens have now all been spoken for, and efforts to secure additional quantities have not proven fruitful thus far. Congratulations to all (myself included) who acted early enough to secure an order of these beauties while supplies lasted.
So, while the "sold out" sign must come up on those items, MK has been able to land enough additional Kings to keep that offer up for the time being. Don't be shy...physical gold in the hand is worth XXXXX promises in contract form when cascading counterparty defaults show all paper for the poor wealth substitute that it is. (In the end, futures contracts are just variations on a fiat currency theme.)
"GOLD: You either have it or you don't when you need it most."
Elavator Guy, Thai Gold & Stock Lies and Ticker Tape
Elavator Guy
Easy to see how errors and misunderstandings can arise when we have little time to read all these interesting, stimulating, though sometimes mildly provoking, postings.
I understood YOUR meaning of �US�. My parenthesis was for those who hadn't read, or remembered your posting. I didn't want anyone to be �provoked� by thinking I, or you, was getting at the US (ofA) I realised after sending it that you might think I had misunderstood.
The general theme, I must have misunderstood. It seemed to me you were drawing attention to all the �theys� as being references to TPTB, which so many posts (including mine) often include, and that you did not believe such malevolent creatures exist.
Hope this clears the air. Hope you're in full sail, and that you scraped all the barnacles off
It's going to be a long bumpy voyage for the next twelve months, and there is a strong enemy flotilla out there, so keep alert.
Thai Gold and Stock Lies and Ticker Tape, Thanks for your appreciated, and pleasant, comments.
Not enough time yet for the Bush administration to make heads or tails of what is really going on in the PM arena. When they do, there won't be much they can do about it. Greenspan is still piloting the ship and may use threats to keep it that way, IMO. So, it's steady as she goes. The trend is still down - though slowly.
War Nickels, Silver/Nickel, and the Defense National Stockpile Center
http://www.dnsc.dla.mil/For the report, see the link titled: Strategic & Critical Materials Report to the Congress
Also notice the PGM link.
.......
I purchased a lot of WWII silver nickels last week. Little did I know the path this would lead me down...
From its beginning in 1866 with the "Shield Nickel", U.S. five-cent pieces have been composed of 75% copper and 25% nickel. During the middle of 1942, however, the country found itself in a difficult situation in that WWII had begun and there was a shortage of nickel for industrial use.
To help alleviate this nickel shortage, the U.S. Mint changed the composition of the five-cent piece, replacing nickel with silver. The composition for the new coin was 56% copper, 35% silver, and 9% manganese. A large mint mark was place above the dome on the reverse of the coin so as to allow for easy identification for possible future melt programs. From 1942-1945, over 48,976,000 troy ounces of silver were used in the minting of these coins. Regular, pre-war composition was re-established in 1946.
One of nickel's many important uses is in the manufacture of stainless steel.
So far, so good. It's the next part of the story which has me perplexed.
Following the link above, you will find a report which lays out last year's national defense stockpile numbers for both nickel and silver (Table 5). Surprise! NO NICKEL LEFT! Also, remember a month or so ago the announcement that the last of the silver from the stockpile would be sold over the next 12 months? All silver held is marked as excess...NO Silver!
The majority of materials on the report show their entire inventory assigned as excess. Huh?
Look at cobalt...all inventory designated as excess. Here is a short description on the importance of cobalt:
"Cobalt is used to harden steel and as a catalyst in such processes as the manufacture of gasoline. Blue pigments made from cobalt compounds add color to paints, while cobalt-60 isotope is used to treat cancer".
The information at the above webpage makes me think the U.S. now believes it can rely on its own, internal sources and those of Canada for silver, nickel, and cobalt - without the need for reserves in these items. I'm not sure this is such a wise policy...it takes time to mine, refine, and transport these raw materials - time we may not have in the event of a sudden conflict.
What the heck is going on here? This is supposed to be a national defense stockpile. It would seem to me that a 6-month supply of all industrial commodities should be kept on hand. Maybe the temptation to use these stockpiles to influence prices (like the attempt made with the Strategic Petroleum Reserve) is just too great for politicians to handle. This is not just a Bill Clinton problem - Congress is authorizing these sales.
Also, notice that DLA has quite a bit of palladium...they've been auctioning it off for months.
The mortar holding the bricks in place is beginning to crumble. This week should see some entry info the gold arena of smaller investors who realize GWB is not going to be a panacea for the Markets, and they begin to dabble more in alternative investments, i.e., gold and silver. While it won't overcome the manipulated market, it will cause gold to inch up to $271.10 by the target date.
Quick review of the gold portion of Friday's data on the U.S. trade data for November
http://www.usagold.com/ProductsPage.htmlDepartment of Commerce November trade data reveals that the U.S. sent $33 billion in currency to international accounts to compensate them for the shortfall in U.S. export of goods and services against the value of goods and services imported from foreign owners. It is the notion that the financial securities accumulated with these excess dollars will someday be cashed in en masse against the prospects of a weakening dollar (and thereby adding to the downward spiral that would affect the "net worth" of dollar owners both domestically and abroad) that argues for a prudent diversification into gold as an alternative financial reserve asset.
International interests do indeed seem to see things this way, and international trade figures with respect to the yellow metal continue to show a significant net outflow of gold from the U.S. into foreign ownership. November gold export levels increased over October by $91 million in book value, reaching $0.559 billion. In contrast, our November import of gold was only $211 million, translating to a net gold outflow of $338 million; approx 39 tonnes.
Comparing this trend with last year, we see that foreign trade partners have really upped their call for our available gold supplies. Figures thus far through November reveal $5.414 billion which has been exported year-to-date, up 21% for this same period in 1999.
A look at U.S. gold imports reveals the year-to-date balance of the gold trade to yield a NET gold OUTFLOW of $2.958 billion, representing very approximately 330 tonnes.
Recalling that U.S. gold mining provides only approx 355 new tonnes each year, any outflow figures for December which are comparable to November's will mean that the equivalent of ALL new U.S. gold was sent abroad, and more.
The disturbing conclusion from this is that it seems that as a very wealthy nation with a lot to lose, collectively we have more more confidence in the future purchasing strength of the dollar than does the rest of the world. Troubling, because the fate of the dollar is held in these international hands. (Repatriation potential, remember?)
Be a nation unto yourself and follow this worldly example of prudence. They are getting their share of earned wealth in gold. Are you getting yours?
No one will make your decisions for you to take action one way or the other...but we do try to equip you with the best information. The rest is up to you. Know this: the kind folks at Centennial are at your service, waiting to do your bidding.
JOHANNESBURG (Dow Jones)--If AngloGold Ltd. (AU) and Gold Fields Ltd. (Gold) merge it might ensure the survival of South Africa's gold mining industry, but it could also dent investor sentiment toward the gold mining sector, say analysts.
Neither company has commented on month-long reports of a possible bid from AngloGold for Gold Fields, but such a move would create an 11.5 million ounce mining house with a market capitalization of around 40 billion rand ($1=ZAR7.8700).
It would also effectively see the withdrawal of a number of gold mining stocks from the JSE Securities Exchange South Africa and reduce investor choice across the sector, say analysts.
AngloGold currently accounts for 60% of the turnover on the JSE's Gold Index while Gold Fields accounts for 30%, Harmony Gold Mining Co. Ltd. (HGMCY) 6% and Western Areas Ltd. (O.WAR) 4%.
A merger with Gold Fields would see AngloGold's figure increase to more than 80%.
If Gold Fields gets swallowed up by AngloGold, then Gold Fields will be delisted and if, as has been suggested, Canada's Barrick Gold Corp. (ABX) does play a part in the restructuring of the local gold mining industry with a bid for Western Areas, then this too will likely be delisted, say analysts.
"If the consolidation goes ahead as people expect, then investors will lose out," said an analyst at a local securities house who did not want to be named.
"Each mine had its own investment characteristic and this will be lost as everything will be geared towards AngloGold," he said.
The driving force behind the merger is AngloGold which is aiming, according to an analyst who declined to be named, to reach a critical mass in order to attract greater investment and win a rerating of its stock.
But Bobby Godsell, AngloGold's chief executive, has contended that South Africa's gold mining industry needs to consolidate to ensure its survival.
This could see AngloGold selling its marginal operations to Harmony which is considered more adept than AngloGold at turning failing mines into profitable operations.
These include AngloGold's Matjhabeng, Tshepong and Bambanai and Joel operations in South Africa's Free State Province, which have a collective annual mined output of 1.3 million ounces per year. There is also AngloGold's Savuka operation in the West Wits area which Harmony has already expressed an interest for.
"AngloGold is a flabby company and it's been mismanaged. They've realized they can't run marginal mines," said an analyst at an international securities house based in Johannesburg.
"Therefore, a merger with Gold Fields would be good because it would then be able to divest itself of its marginal mines and concentrate on the more lucrative shared operations," he said.
This, say analysts, could pave the way for AngloGold to take Gold Fields' 1.4 million ounces per year Driefontein mine, while Barrick would be free to take control of its 1.4 million ounce Kloof operation.
Gold Fields ended trading Monday 5 cents higher, or up 0.2%, from late Friday at ZAR28.75 while AngloGold ended ZAR1.00 lower, or down 0.5%, at ZAR219.00.
M&G is trying to appease angry holders of its Gold pension fund who have just found out that it has been ditched, writes Paul Farrow. It was the only pension fund in the UK to invest solely in gold. But the gold price has plunged from $500 to $265 per ounce in the past 15 years so M&G asked unit trust investors to vote on a proposal to merge the fund with another because of its poor performance. But regulations prevented pension fund holders from voting and they only became aware of the changes in a letter sent to them recently. They are angry because they were moved without their consent. Jeffrey Mushens at M&G said: "They are gold bugs and think that gold will pick up one day. We are trying to see if we can set up a self- invested personal pension which would give them access to a gold fund from another provider."
Remarkable tale of big money, big deals, and a big pardon from "Big Bubba" at the last minute
http://www.futuresource.com/reg/cgi-bin/art?010122/082438An excerpt: "The decision to pardon Rich marked the final chapter in a remarkable
legal and political drama between the United States and Switzerland
involving the hugely successful and highly secretive commodities trader."
Please read this tale of intrigue and then consider---- even guys like this who can pull tricks out of hats cannot pull gold out of hats when the derivative house of cards comes tumbling down.
You either have it already IN HAND when you need it or when it pays off (like insurance, or, dare I say, the winning lottery numbers) or you do not. Gold, that is.
Knights and
Knights and Ladies assembled:
Allow me to introduce myself, I am a retired mechanical engineer whose prior knowledge of things financial consists of knowing how many ten dollar bills are required to make a given purchase. WHile I have learned much while loitering in the vicinity of the table round, my much is a purely relative thing. It is as nothing when compared to the erudition to which I have been exposed here. Even the terms and language are still mostly alien to me. I have learned the most important thing. I must add to my pitifully meager hoard of gold and silver and this then, is the purpose of this post. I will gain a silver Eagle. I confess my avariciousness before you all and I beg understanding.
Sorry, but you have me at a loss. I read the link but did not see how this guy suffered because he had no gold.
All I saw was he amassed a fortune by defrauding Uncle Sam, besides a number of other things. What I learned was that if you are fortunate enough to belong to a certain ethnic group you can get away with murder. As you know, you could be a mass murderer in the US, then flee to Israel ( if you qualify) and there is no extradition.
But perhaps you can explain where I have gone wrong
Sorry, but you have me at a loss. I read the link but did not see how this guy suffered because he had no gold.
All I saw was he amassed a fortune by defrauding Uncle Sam, besides a number of other things. What I learned was that if you are fortunate enough to belong to a certain ethnic group you can get away with murder. As you know, you could be a mass murderer in the US, then flee to Israel ( if you qualify) and there is no extradition.
But perhaps you can explain where I have gone wrong
you have missed the larger message. I did not indicate that THIS person suffered for lack of gold. The point was that even the power of having friends in high places that could pull legal and political strings fails in the ability to produce gold metal out of thin air...being something which may be a desirable but impossible chip to call upon from big friends during an unfolding derivatives crisis. Let contracts fall into default...getting a "Get Out of Jail Free" card is considerably easier than making good promises and honoring obligations.
Is this pardon a clear example of the Clinton administration's tolerance for any such person involved in financial shenanigans? Shall we see the great financial unwinding/reckoning now commense under Bush?
Story Filed: Monday, January 22, 2001 12:23 PM EST
JAN 22, 2001, M2 Communications - The South African gold miner Gold Fields Ltd says it is still hoping to merge with Canada's Franco-Nevada Mining Corp.
The South African government blocked the USD3.7bn merger agreement last September because it believed the merger would not benefit the country's economy.
Gold Fields notes that it is still trading under a cautionary which was meant to have expired at the end of 2000 and the merger agreement with the Canadian miner is also still valid, and the company is hoping that the government might reconsider its previous decision.
(Reuters, 18 Jan 2001.)
African Mining Monitor includes paraphrased and abstracted material with the source, which is deemed to be reliable and duly identified. AMM is unable to provide full-text copies of these original documents. ((Comments on this story may be sent to info@m2.com))
Glad to have you around, Mountain Top! All who join with your spirit are surely welcome.
It's not the amount of knowledge that is important, it's the QUALITY of your knowledge.
A lot of know-it-alls are in for a big, big fall someday not too far away. You find them writing in the big papers, commenting the news on T.V., lecturing in the Universities. They have only scorn for those who frequent this site.
You have come to the right place, something tells you that gold and silver are worth accumulating. You're perfectly right, and you don't need to know much more.
What you find out here, is perhaps, Why you are right.
This would be a fairly good move in just one week but the big money funds that paper trade the POG had 70,903 short contracts as of last Friday and only 13,743 on the long side. First notice day for the Feb. contract is Jan. 31st. These are speculative traders who (I know it's hard to believe!) don't want physical gold. They will have to offset or cover their shorts in the Feb. contract before Jan.31st. Short covering requires buying which raises the POG while, with silver on the move and POG also stiring, these same trend following buffoons may be cautious about re-establishing their shorts in future contract months.
Historical note- the funds were a net 62,910 contracts short in September 1999 just before the Washington Agreement was announced. Open interest (total number of contracts) is as of 1/19/01 only 140,036 contracts. It was larger in September of 1999. The fund's short position now, in relation to open interest, would give POG an even bigger Ka-boom than in 1999, if the funds were forced to cover.
Wouldn't that be fun to see!
Rich
Sierra Madre - I thank you for you kind welcome Sir.
Al Fulchino - Some time ago you sent me the book, "Finding God in Physics" and I lost your mailing address and your email address. I would like to take this opportunity to tell you how much I enjoyed the book and to thank you for it.
Gold is for the ages. A little silver doesn't hurt either.
[B] NY Precious Metals Review: Gold hits 2-wk high as shorts cover
22-Jan-2001 19:49:12
By Deborah Kinirons, BridgeNews
New York--Jan. 22--COMEX Feb gold futures settled up $2.1 at $267.0 per
ounce, after climbing to a two-week high $268.6 amid short-covering. The move
follows Friday's commitments of traders' report, which showed a net
14,864-contract increase in non-commercial shorts, and comes ahead of Tuesday's
25-tonne Bank of England auction. NYMEX Mar palladium, meanwhile, settled up
$12.7 at $1,075.2 per ounce, after creeping to a new all-time high of $1,085.0.
* * *
More
The COT report is a bi-weekly affair so... those 14,864 new short positions were added in the two weeks ending last Friday. For those of us who ask, "Who is buying?", I answer I don't know. But we know who is selling and I think POG held up right well under the pressure of big sales. This shows (IMHO) strength or support in the market. If you wanted to buy big time, when better than when silly trend followers are selling big time. You can accumulate a huge position without running up the price while you're buying.
Maybe...?
Rich
Bush warned his new staff Monday to watch how they conduct themselves as long as they are employed by his administration, using their morning swearing-in ceremony to tell them they had received the "honor of a lifetime."
Moments after White House staff members were sworn in by Vice President Dick Cheney on Monday morning, Bush urged them to maintain a commitment to high standards as his representatives.
"We must remember the high standards that come with high office," Bush said, with his wife Laura, Cheney, and White House Chief of Staff Andrew Card seated behind him. "This begins with careful adherence to the rules. I expect every member of this administration to stay well within the boundaries that define legal and ethical conduct."
He urged the staff members to consult White House Counsel Al Gonzales on ethical matters. And he called on them to confront colleagues if they see questionable behavior. "No one should hesitate to confront me as well," Bush said.
Cheney sounded a fatherly but stern warning to the staff.
"You've all taken up some serious responsibilities ... You serve the president and you serve the White House and the government. But most of all, you serve the American people."
"In the final analysis, it's important to remember only one man put his name on the ballot," Cheney said, with a nod to Bush. "He'll be held accountable for your performance."
Bush said he wanted, at the end of his term, for the American people to know his administration had kept its promises.
"Let us begin the work we were hired to do and leave this a better place than we found it," he said, before moving into the crowd to shake hands with staffers and their family members.
GOX runs up to 4-mo. high
--3:40 pm - By Tomi Kilgore
Gold stocks are shining, as witnessed by the 6.7 percent surge in the CBOE Gold Index ($GOX: news, msgs) to 34.45. The index reached an intraday high of 34.64, the highest level seen since Sept. 22. Among stocks in the sector, Newmont Mining (NEM: news, msgs) is rallying $1 to $17.31, Barrick Gold (ABX: news, msgs) is skipping $1.09 higher to $16.19, Homestake Mining (HM: news, msgs) is advancing 38 cents to $5.19 and Placer Dome (PDG: news, msgs) is climbing 69 cents to $9.38. February gold futures (GC=G1: news, msgs) closed up $2.10 at $267.00 ahead of the Bank of England's auction of 25 metric tons of gold slated for Tuesday. The last auction, in November 2000, was 3.3 times oversubscribed.
This long adventurous golden journey of mankind has led us - down through the ages - on a series of wanderings.
These wanderings have been far and wide, high and low. In many instances - the majority of people have forgotten, or are oblivious to - the experiences - and the lessons learnt. Some have chosen to ignore these whisperings from the past. Fortunately, others have been working at combining these past experiences to achieve a better - more equitable solution for the generations to come.
We stand today at the dawn of the next thousand years. The past hundred years alone are sufficient reminder to all of us that we may have become more advanced - but distinctly less civilized. Something is fundamentally not sound with our "empty" progress. The answer lies in our "measurement" of "things".
The world's population still places far too much emphasis on the value of paper promises - of all kinds. This includes the value placed on currencies, derivative instruments, debt instruments and other contracts. We fail to see the relationship between a "high price" and a "low value pricing unit". An example could be the "high price" of a loaf of bread or Tech stock when priced in a "low value pricing unit" such as a very weak currency. Is the bread expensive - or is the currency weak ? And compared to what ?
Today, and in the recent past - the value of the US dollar has served as the reference point for all trade between nations. When the US delinked the US dollar from gold - the US dollar no longer had a point of reference or measuring point. Accordingly, there has been no way to measure the dollar. Mr Greenspan admitted as much recently. Since the US dollar was the reference point of the world - and had no reference point itself - this must imply there has been no valid reference point at all for close on 30 years.
The gold price today is no longer a reflection of the amount of currency in circulation but has become a function of the combined spot demand/ supply price of gold and the price of a futures contract on gold. The value of a futures contract in reality is close to nothing when push comes to shove - as it is simply a paper promise. If the promise cannot be fulfilled - the contract becomes worthless. Following this reasoning - it is possible for the pricing mechanism of gold to break - "down" - during this developing international revaluation process. The futures price of the equation could more accurately reflect it's true value - thereby driving the spot/futures price of gold - down.
On the other hand - the US stock markets (as one example) are priced in dollars. The less each currency unit becomes in "true value" - the more currency units you will require to get that same "asset". Assuming the debts of a country are "monetized" to "pay" them off - rather than having an outright credit and asset collapse - one could find a situation where all prices in the USA go up - including the stock market. This would simply reflect - "inflation". Inflation is after all - purely a monetary phenomenon. If you create more money through the printing of a currency or via the mechanism of monetizing and increasing debt levels - inflation will be the result. This could filter through into the stock markets in the form of increased earnings by companies - simply reflecting the fact that they are earning "more" currency units for their products than they were previously.
Where then, does that leave us regarding the prospects for gold in the year 2001 and onwards - given that we have had no independent means of measuring anything for nearly 30 years - and given that the price of gold is priced using a pricing mechanism other than the amount of US dollars (and ALL other world currencies) in circulation ?
It seems to me one can well expect to see the price of gold first resolve it's own "incorrect" pricing mechanism prior to it being in a position to reflect the true nature of the worldwide currency situation. This would involve the futures contract price of the spot gold equation being driven to zero as the true nature of the futures contracts come to light. This process will probably take place in the face of an expanding worldwide money supply and inflationary situation that will make people realize that all their "value" measurements appear to be floored. As such - a hard currency asset such a gold that cannot be "created out of the blue" will be sought after by all paper assets.
Only then will all assets be more readily measured from a starting point that will be the measurement of all things - namely GOLD. So gold will probably perform "poorly" initially - but will reward "handsomely" thereafter.
Don't be fooled by the "price" of things. Learn to recognise the "value" of things.
Mountain Top (01/22/01; 13:45:17MT - usagold.com msg#: 46160)
You were one of the people who I didn't recognize as a poster :) Thanks for the thanks. Glad you liked the book. The email is for us to talk about the book. fulchinos@prodigy.net
If Fort Knox Turned Up EmptyI have beat on this drum a couple times and now have seen you as well as Farfel bring up the FK issue, to deafening sounds of SILENCE. This subject is like the crazy Uncle that is always there but never mentioned.
I'm thinking: Is this a form of Forum correctness, that we don't talk about Uncle FK? That's not really gold drooling profusely out of the sides of his mouth, he's just got a little gum problem. However, this cannot possibly be the answer as this site will talk about most anything. Review the last 2 days for example!
The answer has to be that NOBODY REALLY CARES, or possibly that everyone assumes the gold is GONE already and again, don't care. Am pretty sure that everyone I come into contact with tomorrow on tierra firma couldn't care less one way or another. It's simply a left over relic from the past that they don't understand, and it doesn't effect their lives. Would love to see the responses ellicited by a newsman poking a mike in some faces and asking: What do you think about possible missing metal from Ft Knox?? Unless they've been watching some Bond reruns they won't have a clue.
If no one cares, not even the sound money sites, why not use it as some form of pork and get something out of it? The US Banana is King and the perceived value {price} of a full FK in relationship to all of the outstanding bananas is quite miniscule. Another sign of how LATE it is and what a JOB they have done in demonetizing gold in the public mind. Business as usual and as expected.
As that famous Viagra pitchman exclaimed----Where's the outrage?! Well, this knave for one IS outraged and we may just have to start a membership drive to storm the gates for a fool {full} inspection. If no outrage then ----Where's the curiosity?!
I just gotta know......Does a single soul, unfortunate enough to still be reading this irrelevance, believe FK still has the goods???
After 8 years of Clinton administration that was suspect in it's intentions I feel the change of office will set gold free. I have a notion that President Bush will "want to pop the credit bubble, drop the dollar, and let gold rise sooner rather than later. In other words, get the nastiness over early while you can still stick the mess on Slick, then play the hero who restores the economy on a sound footing after the profligate Clinton years." (1)
The US asset bubble has been bought, not earned. Each and every 'sub-bubble' is at great risk; the entire financial sysytem has "become leverage on leverage, speculation on speculation, piling risk on risk � the proverbial "house of cards"". (2)
Corporate America is now confronted with decelerating growth, decelerating profitability and accelerating debt. Consumers, who account for 2/3rds of economic activity suddenly realize the predicament they are in. Mortgaged, margined and indebted to the hilt, suddenly the 'wealth effect' is vaporizing. The 'powers that be' are "dealing with extreme structural distortions, both financial and economic. The public is completely oblivious, and policymakers stunningly unprepared. This is, most regrettably, the worst-case scenario developing right in front of our eyes." (3)
The soft landing/hard landing scenario will be played out, IMHO before end of 2Q01. Today's gold stock numbers signal something, perhaps Mr. Bush has already let something out of the bag. I am so happy to see the change of administration, not in the Democratic/Republican sense but merely that possibly, maybe possibly some shady characters will be booted out. Mr. Bush now has opportunity to clear the field, set the record straight and tell America and the world what has been going on the last 8 years. I think number crunchers know the truth, we'll see if Mr. Bush really intends
to instill fairness, equality and honesty across the board.
And finally for Mr. Bush to contemplate. "The system is literally "at the end of its rope," precariously left today with the financial sector locked in a self-destructing process of leveraging, the only means of sustaining this momentous bubble. I just can't come to see how this ends in any other way than disaster. I don't want to yell "fire" in a crowded theater and I am mindful of the seriousness of the current environment. But I will be honest about this: I don't like the looks of this one bit and am particularly worried about how this is developing." (4)
My only (small) take on the FK (actually several locations, including CO & NY) gold, is that its unpublicized absence would certainly be a prime motivation to demonetize gold for as long as possible, in favor of the dollar, again, for as long as possible.
The strategic 1-2 plan, of course, would be to run fiat for all it's worth, then phase in the gold reserve for at least the dollar's continuing equal status with other major currencies. (Didn't FOA mention some lingering legal difficulties from the 1971 closing of the gold window? A re-backed dollar might awaken some old claims?)
But, if gold's not there, then the dollar doesn't get that second life, does it? And US citizens have to work, produce and export harder to build up any trade credits for future consumables.
But, in the hands of the .gov, I've never thought of the FK reserve as something that was going to benefit ME, or anyone I knew, directly. Isn't that why we have our own small fortresses? And long ago stopped inviting over for dinner the wacky neighbor with the funny accent and the spray can of gold paint?
Hey auspec - always fun to read your stuff! Actually, the Ft. Knox thing was cussed and discussed here quite some time ago. There doesn't seem to be much to talk about since nobody I know has the key. I'm with Mr. G in that whether the US still has their reserves, or more or less, is most likely priced into whatever market that stuff trades in. I'm sure those that trade that market have some idea where most of the gold actually resides and which entity has claims. I don't expect we'll ever know the real story as nobody in the biz of trading large amounts of gold has any vested interest in telling us.
Since we're stuck with fiat currencies as far as the eye can see, I suspect exactly who has what will remain a mystery. The only time we'll likely know anything is when somebody actually runs out and can't deliver against some claim and it becomes public knowledge. Maybe soon, eh?
Read a fair bit about the Fort Knox business via the James Turk site(s). Strange stuff; the part I can't fathom is the mandatory, independant yearly audit that hasn't been done since 1975(ish).
Who's Naked?Thanks Mr. G, ET, & Canuck for your FK input. I will have to locate previous discussion of same. On the trail, even if it has grown a bit cold.
Premise--- An undisputable mountain of gold derivatives/shorts exists. The simple question: is this a naked short, and if not, what backs it? Options:
1. Backed by official/unofficial gold supply.
2. Backed by "the full faith and credit..."
3. No backing, shorts will be SOL.
The silver shorts give us clues to some point, as it is accepted to a certain degree that the silver does not exist in an above ground form to cover the shorts. Therefore, why would gold have to be any different than silver? CFTC doesn't seem to have any problem with players shorting silver in amounts that are impossible for them to cover. No big deal when an entire Gov is run by the seat of their pants.
Please think through this, if you are so inclined, as to what the answer is to this "simple" question.
Got backing?
This is my first post here and I would like to take this opportunity to thank you all for the very sound course in economics and finance. It is very much appreciated. I have taken other such courses, mostly while attending the School of Hard Knocks and this forum is infinitely preferable.
I have seen many predictions as to the future of the markets over the last several years. They've almost all been wrong, in timing if nothing else. I've come to believe that it can actually do people a disservice to make these predictions. In June of 1997, I sat across from a man at a financial conference who told me that the end was nigh and that by year end, the market would collapse. He said, "Trust me. I'm over 80 years old and I have made millions for many people". I trusted him. He was wrong and I lost money. One guru actually trotted out a note from his dead father while predicting the end in 1998. He too was wrong. Again I lost money. This last guru has a Phd. It didn't help.
I have come to believe that when the interests of many diverse groups are involved, there are so many possible outcomes, and so many unpredictable events, that several predictions may be within the realm of possibility. Kind of like Wheeler's infinite number of outcome universes. Unless you're on the inside, it's all just a guess, educated or not and even insiders don't always get their way. And as someone at this august round table recently stated, mere good logic is insufficient to being right. Therefore, if the very well spoken and erudite knights here assembled will forgive my impudence, I feel justified in making some predictions based on two of the four Nostradamus quatrains originally posted by "Ben" over on Gold Eagle (Nov. 23, 22:55). My interpretation differs from the translator's and from Ben's but so what? One prediction is as good as another right? Thank you, Ben, for posting this.
(Century VIII, Quatrain 14):
The great credit of gold and silver great abundance,
Shall blind honor by lust,
The offense of the adulterer shall be known,
Which shall come to his great dishonor.
My interpretation: The paper shorting, forward selling and physical dumping of gold and silver has caused the distortion of these markets to the betterment of a few dishonorable players. The adulterer could certainly be our illustrious ex-president, (I think he qualifies!) but adulteration also has the meaning of pollution or dilution (of physical gold). The adulterer could be Goldman Sachs. In any case, the manipulators in these markets shall be exposed.
(Century III, Quatrain 13):
In the ark, lightning, gold and silver melted.
Of two prisoners, one shall eat up the other,
The greatest of the city shall be laid down,
When the navy that was drowned shall swim.
I cannot interpret the first line but it may have to do with the discovery of one of the Arks of the Covenant (as you recall from the bible, there were two). The two prisoners in the second line are clearly gold and silver. They are prisoners of the Comex. "One shall eat up the other" could mean one of two things. Gold could greatly exceed silver in value, or the other way around. Since gold usually does exceed the value of silver, such a prediction is of no consequence and therefore, in my interpretation, not worthy of consideration. I will predict the second. Comex will default on silver first and it will exceed the value of gold as Comex paper pushes gold to new lows. This will be the time to swap silver for gold. If silver were to exceed the value of gold, it would be very damaging to the ECB as it would erode the psychological value of their gold reserves. Platinum and Palladium already have done this by exceeding the price of gold but silver would be the last straw. This psychological issue is important. Since the Euro is not a true gold standard currency with exchangeability to gold directly, what purpose the reserves? Only their psychological support that in an emergency, they would be available for settlement of the paper notes. I believe FOA has touched on this issue. This issue cannot be ignored. The ECB would be forced to re-value their gold to the true trading value which is something in excess of the $574 that the US secretly values it in settlement. This is why so many strong hands are invested in silver. They will ride silver up, then change elevators to ride gold. The third line refers to the hot shots of New York finance. They will be brought low as their complicity in all that has transpired is exposed. And the last line refers to the destruction of the US Navy. It is a prediction of war. But as at Pearl Harbor, the Navy will ultimately triumph.
The timetable for all of this? Soon! Am I right? Who knows. Mere logic is not enough to assure success but predicting is definitely fun. I must sign off now as I grow fatigued. As Yogi Berra once said, "Predicting is very difficult, especially of the future." ;-)
Net US Gold Outflow?Hey Randy,Canuck,
Hope you guys actually have all this gold and silver we are prostituting ourselves to win. One never knows in this country, and when was the last official CPM audit???
Actually, I was wondering if you have any further breakdown as to the "NET gold OUTFLOW" of the 330 tons you mentioned?
What % is "official" and from what source does it come?
Canuck-- You were asking about "earmarked" gold that is held in NY if memory serves me. This gold was erroneously being included in US export figures as either an honest or dishonest mistake. Have read James Turk's FK quest.
We have to be talking about DEPLETION of US gold reserves, no? Help me out a bit, please, it is within my weak grasp!
What was James Turk's famous line, "...it APPEARS that the gold is in Fort Knox".
I am quite sure the last (mandatory, yearly, independant) audit was in 1975 (give or take a year).
Oh yes, the 'earmarked' gold. Gold brought to North America to be safely stored during WWI and WWII. Now when it's 'sold' back to the European's it 'counters' the trade imbalance, crafty maneouver.
Notice Tree of Life with the $574 number, reminders of Christian a week or two back, ha, ha. The commodity price, the trade balance price and the credit creation price!!
There seems to be several deposits of gold, several prices for gold and seemingly infinite 'accounting' practices for gold, ha, ha. Seems to depend on which side of the fence one stands.
This gold thing is sorcerer's brew man. The deeper one's gets, the more poisoned it becomes.
Aristotle is no where to be found? Ari had a wicked post a few months ago, wish I could find it; pertaining to the wicked BOE, centre-stage tomorrow. I think COMEX is a baby compared to the LMBA.
Read Reggie's latest, the BOE's timely gold-giveaway coinciding with bi-monthly future's expiry; a liquidity provider when things are most dry. Don't want the shorts dry now do we?
Notice the chat today/tonight re: shorts, some 57 million oz., highest (almost) since Sept.99. Remember late-Sept.99, rock-and-roll time.
Notice AGE (AEM) +11% today, PDG, NEM, some movers today. Ahead of the BOE auction? Something is very, very strange, hee, hee.
First day of Bush admin., I wonder what was said in Washington today?
How can you say such words against the brave men and women who want to rule over us? That is SOOO unfair. They are so righteous and good. I have a truly warm feeling towards 99 percent of them :)
Look for at least part of an interview with Congressman Ron Paul to be included in the latest of John Stossel's ABC News special programs. This one, entitled John Stossel Goes to Washington, will air this Saturday, January 27 at 10:00 pm EST/9:00 pm CST.
Reasons are the powers that be have to continue to maintain the illusion that inflation is still low.
The auction will probably be oversubscribed by 4.7 times, and the price will probably rise $5 by next Friday.
>>>>=========$270.10============> As more and more posters seem to have caught on, prediction is very difficult, especially of the future, so any prediction is a guess.
However in this case, an educated guess is possible. The official-unofficial price (yes I'm a manipulation believer) has been around the cost of production for a certain cross-section of producers, around $270. A lower price and more and more people begin to catch on that physical gold is a steal (and it is) at a price below this production cost.
This would cause a greater loss of physical, which, presumably, "they" want to avoid. The price will rise a little after the BOE sale - - - why should this time be different - - - and so we end up with gold controlled around $270.
***********Herald of the Odyssey 2001**************Bold Action Knights! Some would say Nay! Cling to the past and the strength of the Fortress. But the enemy of old is a shape shifter who will not be frozen in one form.
On the coinage of the Realm, is the claim "IN GOD WE TRUST".
*The "Indispensible" Nation, the one who by accident and by design, plays a role of Hope and shines a Beacon of Freedom
while riddled with the assaults and influences of the evil one inside and out.
*It is one thing to joust with windmills, and another to identify the real enemy and the real nature of the playing field and the game that is afoot.
*Some country songs romanticize pickup trucks, some men romanticize currency. Knowing nothing of the past, some men romanticize the short, cruel, way of life that men of even the recent past endured.
*Playing chess with it's self created enemy, the god prods men toward kindness while the devil takes his due.
*Some Mortal men and Knights, taking the risk of assessing which action is the influence of the devils' and which is the gods', claim gold is the truth and fiat is the evil.
*Families hope for a better life, prayers of millions have cried out for centuries for a better life. How that prayer is answered, against all the wiles of the evil one, and inspite of the natural failings of men, is the real game here. Knights would want to always somehow know where thier leader stands and where his hand is.
*Other Knights, having fought in wars against evil in other forms, take the prudent action that is presented to them as they see it. At this time, the die is cast, cast imagination aside, for better or worse, for evil or good, the course has been chosen.
A Knight of another Table has sent a message. I bring it to you now. Knight Rubin, recalls a crucial step in the Asian crisis: "You used to be able to organise a relatively small number of banks in order to develop some kind of temporary relief so the banking system could work through its problems, but with banks being replaced by capitol markets and millions of derivitive bond holders, there's no equivalent way to organize the creditors, There is no way now to organise a standstill that might prevent things from cratering."
*Knights, the Samurai in Japan are clamoring for thier .25%
interest rate to be cut because they are in fact at the edges of deflation. America MUST shop. Fannie and Freddie, two weapons of credit creation, are targeting a 2 Trillion dollar increase in household lending. Targeting Blacks and single moms in particular, for home ownership. That 2 trillion dollar weapon will keep the walls of the fiat world intact and the price of gold contained at least through this coming year.
*Knights, knowing the dire circumstance, those in charge of our allies in Europe, have thrown thier lot with the Dollar. The B.I.S. has taken the role of managing and reporting the Derivitive weapon numbers, one reason is that they are not bound to release data by anyone. Lower ministers may say otherwise, but America is leading, and there is no turning back except to embrace destruction.
Contest #2 The POG has been rising ahead of tomorrow's Brit BoE "Give-away" program. That is a strong signal. The price of gold mining shares has jumped even greater. This usually precedes a gold rally. I expect some resistance as the shorts will throw everything they can a keeping the POG under control. This battle could last for a few weeks � therefore, I offer the more pessimistic price of $269.70 per ounce with a strong sustained run on the POG to the upside.
Reasons given for any guess are based on mere conjecture, not fact. The POG has not reflected golds true value for years. Unless you are the most influential puppetmaster, the POG is usually as predictable as the direction of the wind at any given moment.
Some fun speculation Good link to the "Short" article. Think on this one. There are a record number of speculative short positions, record number of commercial long positions; the auction tomorrow is largely oversubscribed (possibly by several producers). There is a sudden rush to cover short positions that begins to feed on itself, and soon the investment bankers find themselves with their tit caught in a wringer. This continues as hedge-fund miners such as Barrick (ABX) and AngloGold (AU) get caught up in margin calls ala Ashanti (ASL) and the now defunct Cambior (CBJ). This continues only to cascade with more shorts covering and the POG rapidly rising.
That would be "interesting." As well as entertaining.
http://www.acitravel.co.za/main.asp?conf_id=2Strange concept of gold as a catalyst. The Gold Institure had an article about AngloGold sponsoring some research in this area. However, gold is nonreative, so what gives? It would be fantastic if it works out as a competitor to PGMs in this area.
This quote from the French finance minister,Laurent Fabius, was included in Bill Murphy's Midas commentary of January 19th.
"I have always considered the idea that the American economy had discovered perpetual growth naive.The conditions we've seen for some time now,including the lack of savings and external trade deficit were inevitable financial negligence wrought by the over valued dollar.I know ,however that the new American administation is well aware of these games and is capable of acting pragmatically in close coordination with Alan Greenspan.The group of seven meeting in one month will give us the possibility to discuss these questions."
This was sourced from Bloomberg,however,I couldn't find it to confirm it or to find out in what setting and to what audience it was presented to.It brings back a moment in history that is eerily familiar though.Are the French going knock the wheels off the US dollar gravy train again?
http://www.gold-eagle.com/gold_digest_01/mcintosh012401.htmlThe link is to an interesting article. I am amazed when I find someone who sees things as I do. Though I think that stagflation is a definite possibility, the article tackles some important points that we have dicussed here before. I admit that I do like the authors style.
Year 2001 essays, COMEX price predictions, and new posts...Deadline is at the end of this posting day!
***REPOST OF DETAILS***
USAGOLD (1/19/2001; 11:27:32MT - usagold.com msg#: 45919)
Hear Ye. . . .Hear Ye. . . . A Call to Contest. . .
A test of your thinking, predicting and posting skills to occur from now until ***>>midnight (MST) on Tuesday, January 23rd<<***. We stand at the first month of a new millennium, a time to stop and think what the future might bring. So the contest is simple as it is challenging:
To wit: Will 2001, a market Odyssey, be a positive one for gold or a negative one? Is this the year of the big breakout? More of the same? A disaster? You make the call, support it with knowledge, skill and erudition and the prize is yours!
We ask contestants to treat the potential economic, political and financial scenarios as a basis for their opinion. We stand at a threshold -- not just of a new century but a time of uncertainty as the winds of change sweep through the world economy. There could be no better time for a contest with such a theme than now.
Your post must be at least 30 words and it must contain in the subject box the following:
**** 2001 -- A Gold Market Odyssey ****
(Surrounded by stars as shown....to help get our attention when we gather the many entries together at the deadline.)
The prize will be a .1867 ounce pre-1933 French Rooster gold coin. There will be two runners-up who will receive a one ounce silver Eagle each.
Also, we will have another contest to guess the price of gold for the February contract at the close Friday, January 26, 2001. All entries must be posted, however, by midnight (MST) Tuesday, January 23, 2001. The winner of will be the one whose arrow falls most closely to the mark, and shall be rewarded a tenth ounce prize that shines with the light of gold. All price guesses must be accompanied by sound reasons for your prediction to gain the prize. And as has been done it the past, it would please our judges if you would use standard arrows in the subject line of your post when you take aim to enter this 2nd contest. Like this:
>>>========= $300.00 ==========>
Also, all first-time posters will be awarded a one ounce silver Eagle if you post during the contest period -- from now until Tuesday midnight, January 23rd, 2001.
To qualify for the prize, you must e-mail jill@usagold.com confirmation citing the message number once you've made your first post. We will check each first-time poster's claim, so don't feel like you can get one by us.
We wish you good luck, good fortune. . . . . .And. . . . .
One must the obvious. Why does CA not want to resolve the NG PG&E debacle by alowing consumers to directly absorb the wholesale price increase in fuel?
Instead they propose a convoluted bond and hydro-electric takeover plan to pay down the bond. Does not such a plan assume a lower price of NG in the future?
If NG does not go lower sooner than later, either the bond will grow then default or other bonds will let until such time as it no longer staves the inevitable.
We know the Gov. of CA consulted with the FED on all this weeks ago.
Seems like first gold and silver were contained to hold back look of inflation; now Natural gas. What next?
With the expectation of interest rates in the US being lowered further in the next few days - and with Mr Greenspan speaking on Thursday - it is possible for the perception to remain that Mr Greenspan et al are still in control of the financial markets. This necessarily includes the gold market. Since the perceived market risks will appear to be less after the erudite words of Mr Greenspan - there is no reason to expect to see any "contrary" indicator spoiling the party just yet. Although the music may have stopped - the fat lady (US $) still sings. My favorite expression : "Expect a Miracle".
Date: Tue Jan 23 2001 02:31
Heavy Metal Sunshine (Goldfish) ID#404177:
Copyright � 2000 Heavy Metal Sunshine/Kitco Inc. All rights reserved
I don't think anyone has been saying that the gold market has been manipulated for 20 years. In fact, the GATA literature points to about 3 or 4 years ago as the beginning of strong manipulative occurrences. Also such manipulations do not require constant action on the part of said manipulators merely concerted corrective action from time to time. Regardless, once the well heeled and well informed members of that subclass "Everyone wants to make money" became aware of such an artificial stability in the gold market they sought out ways to make money from this phenomena. Thus the gold carry trade came in to being and this further reinforced that very price stability. Unfortunately, it created an unnatural imbalance in the marketplace, that you and others like you are saying is really "natural diagnostic balance". A balance that you then base ( Diagnose ) your whole view of the marketplace and the economy.
It is like the story line in "Alice in Wonderland". It does a wonderful job of working with such reflections of realties.
To say "$ price of gold is manipulated. It is impossible." Is foolish when one looks at the relative size of the gold market to the equities market or the currencies market or the bond market. Gold is but a pimple on any one of those markets butt!
But the psychological power of gold in comparison to those markets is something else altogether. It is kind of like a horny little mouse climbing up a big sow of an elephant whispering that it'll be gentle. To see it you would laugh at the mouse for the sheer arrogant audacity of it. But then to witness the elephant stampeding off in stark terror would give one pause to think.
At the core of your statements it seems to me is the belief that there is a shortage of liquidity. I disagree. The liquidity is there; it has been expanded consistently. I am sure you have seen the statistics posted here at least several times a week. You appear to think that if there is sufficient liquidity it will go into the gold market as if by some divine decree. No, in today's marketplace derivatives have taken the place of gold. Taken the place not only of gold, but of caution, of sensible investment strategy, of farmers, miners, steelworkers making an honest living because derivatives allow their creators to take unnatural advantage in the marketplace. It is like playing cards with someone who is allowed to rewrite the rules whenever it suits their needs.
It is my belief that gold will break the derivatives market or the derivatives market will meltdown and set gold free. And I'm not just talking about gold derivatives.
When you have an equity bull market and you have inflation, equities inflate. Witness the last 3+ years M3 has been expanding and equity prices have inflated. The statistics are staggering. But we are at a crossroads where the equity bull is becoming a commodity bull. In years past this transition would have been more apparent by now but with the power that derivatives yield, nature is being held back and so the perceptions of nature. All the "fools" at this site know something's going down, just not when or exactly how. I consider myself one of those "fools".
Just wanted you to know that I enjoyed your post. Sounds like you've been around some. Experience is one of several great teachers. I mostly enjoyed the readability of your writing as many who post here are difficult to follow. Don't wait too long to post again. ski
Updated 3:21 PM ET January 19, 2001
PARIS(Reuters) - French Finance Minister Laurent Fabius said Friday the U.S. economic slowdown was inevitable and had been looming for some time.
Fabius said finance ministers of the big economies in Europe were looking to the meeting of the Group of Seven world economic powers in Italy in mid-February to discuss the issues with the new team taking over in Washington.
"I've always believed the idea that the American economy had discovered the secret of perpetual exponential growth was naive," Fabius said in a speech at a Franco-British business gathering.
"The limits of this exponential expansion were being noted several months ago, such as the lack of savings and the external deficit, as well as a degree of negligence financed by the high level of the dollar," he said..."
New Plants May Ease, but Not End, California's Crisis
By SAM HOWE VERHOVEK
YUBA CITY, Calif., Jan. 18 � These farmlands north of Sacramento seem an unlikely spot to represent California's hope of staving off the economic turmoil that threatens the state. The largest growers' cooperative in Sutter County is in bankruptcy proceedings, and the unemployment rate is 13 percent.
There has never been a high-tech boom here, local officials say, nor much tourism. And much to many residents' continuing ire, Yuba City showed up a few years ago dead last on Money magazine's annual survey of the 300 best places to live in America.
But southwest of town, hundreds of workers are struggling in two 10- hour-a-day shifts to build a huge power-generating plant in the nation's largest state, which has not built a major energy plant in more than a decade. Several such mammoth construction projects are under way in California, and energy analysts say they are essential to easing the deepening electricity crisis that has led to rolling blackouts in recent days, threatening the livelihood of businesses including Internet companies in Silicon Valley and farms in the inland valleys.
Still, the construction of the plant here and at least eight others, many in similarly downtrodden areas, is a race against time. Some officials warn that, with no end in sight to the energy problems, the risk of blackouts may be even greater during the hottest days of the summer, the season when California normally hits its peak demand.
Even though the projects represent a total of 6,723 megawatts � enough electricity to power nearly seven million homes � they do not by themselves guarantee an adequate supply for California, since roughly half of the existing power plants are more than 30 years old and are in danger of being retired, according to the California Energy Commission, a state agency.
Whether the construction can outpace such mothballing is an open question, and, in a fitting touch of symbolism, the state's current power problems even impinged on the 500-megawatt plant here, known as the Sutter Project and owned by the Calpine Corporation of San Jose. Construction ground to a halt for more than an hour on Wednesday when the rolling blackouts spread across Sutter County.
"How bizarre is that?" said the project manager, Tom Miller, with a rueful chuckle as he walked through the plant today. "It takes power to make a power plant, and here we were, just shut down."
Despite that brief interruption, the gas-fired Sutter plant is on target to feed electricity to a transmission line stretching south toward Sacramento in July, and another 500-megawatt project, in Pittsburg, northeast of Oakland, is also scheduled to go on line by then, according to the energy commission. But Claudia Chandler, a spokeswoman for the commission, said it would not be until 2003 that the state is expected to have enough capacity to meet the peak demand in summer.
In the short term, many independent experts say that the only way the state can avoid supply problems is to expand conservation measures, especially those that significantly bring down the peak demand level. One way to do that is to make the power more expensive at times of the day when demand is greatest, giving businesses and consumers an incentive to change electricity use.
"There needs to be a more rational pricing scheme," said Severin Borenstein, director of the University of California Energy Institute, a research organization on the Berkeley campus. As important as the new plants under construction are to solving the overall problem of electricity supply in the state, he said, they are not a panacea.
There is a definite concern that we're going to lose capacity with older plants shutting down just as we're adding this new capacity, and the demand has kept growing," he said. "So when we're going to catch up with this problem depends in great part on what happens on the demand side."
California narrowly averted blackouts last summer by importing about one-sixth of the 46,000 megawatts it needed to meet peak demand, according to the California Independent System Operator, the nonprofit manager of the state's power grid that was created under the state's 1996 law that deregulated the electricity market.
In a move that has generated considerable hostility from California's neighbors, federal energy officials in recent weeks have ordered suppliers in the Northwest, the Rocky Mountains and elsewhere to export electricity to California to help stave off its problems. Normally, at this time of year, California has been in a position to export power, especially to states to the north who reach their peak demand for electricity during winter.
California's deregulation experiment is now the subject of near universal denunciation, from average consumers who suddenly found their lights turned off this week to Gov. Gray Davis, who in his recent annual address to the Legislature called deregulation a "colossal and dangerous failure" that had allowed "profiteering companies from out of state" to raise wholesale electricity prices by nearly 1,000 percent.
And yet, on another level, the deregulation measure did exactly what it was supposed to do: it led to a wave of proposals by energy companies for projects like the one here in Yuba City that will use cleaner technology, meaning they are supposed to pollute less than the current generation of power plants. Many of those companies had held off from such construction for years because of uncertainty over how and even whether the state would move toward deregulation.
"The sort of facile blaming of the lack of construction on California's environmental restrictions is misguided," said Professor Borenstein. "California does have serious environmental rules, as a lot of other states do. But the real reason investors didn't build plants in the 1990's is that for a long time, no one knew what the rules were going to be."
In any event, no major plants were built during a decade when the state's population grew by four million and a soaring economy, led by the boom in high technology, sparked demand for electricity as well. Since deregulation passed, California has approved the nine plants now under construction, compared with none in the prior decade, and 22 more are in the regulatory pipeline.
"The reputation of California being a Nimby state has been shattered," Steve Maviglio, Governor Davis's chief spokesman, said recently, referring to the "not in my back yard" reaction that prevented many plants from being approved in the past.
But the new plants do not represent any immediate solution to California's electricity shortages, which are aggravated by the precarious state of two big utilities, Pacific Gas and Electric and Southern California Edison, which are billions of dollars in debt. They are on the verge of bankruptcy, they say, because they had to buy electricity on the open wholesale market as prices have risen, but, under California's deregulation law, cannot pass costs on to the consumer.
And by and large, the new plants are not being built near the state's biggest metropolitan areas, but instead in places like Yuba City, where local officials welcomed the plants as an economic boon or where opponents lacked the clout to prevent them from being approved. Especially since the state's shortages became clear last year, state officials have moved aggressively to cut the regulatory procedures, and Governor Davis persuaded the Legislature last fall to pass what he called "fast- track" approval measures.
But even as those new plants come on line here and elsewhere in the inland valleys and along the Mexican border, providing more electricity to the state's power grid, the transmission system has bottlenecks that prevent the power from getting to where the demand is heaviest. That problem is especially acute in the San Francisco Bay Area, where some industry officials liken the problem to the congestion on a freeway off- ramp that creates a jam even if the main highway is running smoothly.
Perhaps even more than the plants themselves, large transmission lines and their towers have been the subject of intense opposition. "If you think power plants are hard to build, transmission corridors are even harder," said Katherine Potter, a spokeswoman for the Calpine Corporation.
Here in Yuba City, there was some opposition to the new plant, especially from those who live in areas closest to it or along the transmission corridor that will carry the new electricity into the state's power grid.
"This power isn't really going to be used here," said Rosie Foster, a fourth-generation prune and walnut farmer who lives near the plant and belonged to a group that led the fight to block construction. "In the places where people want the power, that's where the power plants should be built," she said. "But this is a poor county. The people who run the county wanted the money."
Sutter County officials say that the money � $3 million a year in school and property taxes, and other benefits built into the package negotiated with Calpine � was indeed a significant inducement. They said they hoped it would help attract more industry to the county, though they found it a bit of a paradox that the state was now looking to a place like Yuba City to help keep its economy robust.
"Sutter County has always lagged behind," said Larry Combs, the county administrative officer. "We've tended to lag behind when there's been an upsurge in the economy, but we fall immediately with a downturn. If having this plant here is going to help the state get out of trouble, that's got to be good for the county too."
Black Blade: The Peoples Socialist Republik of Kalifornia have delayed too long. The new power plants may help relieve some of the state's energy woes. The problem of course is that several existing plants are due to be "retired." Not only that, how are the new plants to be fueled? Natural Gas? HA! These new power plants will solve nothing without the state allowing the exploration and production of NG and oil. Also, they will have to consider the building of nuclear and coal fired power plants. Life is about to get "interesting" in Kalifornia. I saw socialist and self proclaimed consumer advocate Harvey Rosenfield interviewed on CNBC's Hardball last night. These people are still in denial about the energy shortage. He stated that the shortage is nothing more than a ploy by "powerful marauding energy interests" and he proposes that the government takeover power producers in nieghboring states to force them to provide power to Kalifornia at cut rate prices. Typical Kalifornia Grasshopper mentality. As the old bumper sticker from the 1970's use to state: "Let the bastards freeze in the dark." Meanwhile, GW has stated that Kalifornia can seek out a market based solution on their own. I see no problem here, as Bubba put the screws to the western states when as punishment for not giving him the vote in 2 elections, he used his dictatorial powers and with the stroke of a pen, he stole millions of acres from the people who scratch a living from the earth in the west. Kalifornia didn't vote for Bush, so why should he care? He's not going to get the vote next time around either. Time for a little "Quid Pro Quo." In other words, "what goes around, comes around." - "...And the Grasshoppers danced, sang, and played all summer..."
AP National by JENNIFER COLEMAN Associated Press Writer
SACRAMENTO, Calif. (AP) -- Transmission problems aggravated California's power crisis on Monday, as authorities warned that homes and businesses in the north of the state might go dark again Tuesday morning. Officials at the Independent System Operator, which runs the state power grid, said rolling blackouts could be in place again between 7 a.m. and 11 a.m. if substantial electricity were not found overnight. ''We're looking everywhere for energy,'' said Kellan Fluckiger, the ISO's chief operating officer. ''We're looking under every rock and bush like we always have been.'' The electricity shortfall was predicted at 500 megawatts or enough power for half a million homes.
Problems in the system are beginning to compound, with Pacific Gas & Electric having reached, just three weeks into the year, the annual total hours it can shut off power to its interruptible contract customers, Fluckiger said. Those customers are businesses and others that agree to accept outages during times of tight supply in exchange for lower rates. With those customers shut down for several hours daily last week and several hours Monday, PG&E has reached the annual limit of 100 hours. Without the ability to cut interruptible customers, Fluckiger said, the system will face a deficit of 300 megawatts from that source.
In addition, reservoirs at a key hydroelectric plant near Fresno were low on water to turn generators; a transmission glitch in Oregon persisted and could take several days to fix; power usage routinely climbs as the week progresses and offers to sell the state electricity were lower than expected, Fluckiger said.
Stage 3 alerts -- the most severe and the prelude to rolling blackouts --remained in effect Monday, marking the seventh day straight with electricity reserves near or below 1.5 percent. Even though blackouts were not necessary Monday, the transfer of power between south and north was slowed when the three major conduits were jammed at a bottleneck consisting of just two 500,000-volt lines in central California. ''The ISO is caught in the middle, caught in a system not improved in three years,'' ISO spokesman Patrick Dorinson said. Blackouts occurred briefly Sunday for as many as 75,000 customers in Northern California, but they were caused by a spike in power from Oregon, not from shortages.
Meanwhile, the state Legislature considered several potential solutions to the crisis, including one under which the state's two largest utilities --Southern California Edison and Pacific Gas and Electric -- would donate their hydroelectric plants to the state. In exchange, the state would begin buying additional power needed for the state through long-term contracts and on the spot market, both of which have led to enormous debts for the utilities. The plan would make the state one of the largest owners of hydroelectric power in the nation. Another plan, proposed by Assemblyman Fred Keeley, would put the state in the electricity business for up to five years, buying power at low rates and selling it directly to consumers. The Assembly has already approved it. It still needs approval in the state Senate and would have to be signed by the governor. Keeley said his plan would buy time for the state's two largest utilities to restore their credit while lawmakers worked on long-term solutions to the state's botched deregulation laws.
Gov. Gray Davis is reviewing the ideas, but considers the hydroelectric plan more attractive, spokesman Steve Maviglio said. Consumer groups on Monday gave Davis' office more than 5,000 signatures from consumers rejecting what they called a multibillion-dollar bailout for the utilities. ''We see the cancer spreading, if you will,'' said Graham Brownstein of The Utility Reform Network, a San Francisco-based group. PG&E and SoCal Edison have been on the verge of bankruptcy for weeks. They blame their more than $10 billion in losses on California's 1996 deregulation law, which bars them from passing skyrocketing wholesale power costs onto consumers. The Legislature and governor last week allocated $400 million to buy power over the next several days because the utilities, whose credit ratings have been downgraded to junk bond status, can no longer find wholesalers willing sell them power on credit. State officials hope the plan will help avoid blackouts while lawmakers work on longer-term solutions.
The state's Department of Water Resources, the agency authorized to buy power under the emergency legislation, has spent at least $113.2 million since Thursday, including $35.2 million for Monday's power needs, said Mike Sicilia, a spokesman for Davis' office. In addition, DWR spent $38 million last week under a state of emergency declared by Davis until the emergency legislation became law, Sicilia said.
In Washington, Energy Secretary Spencer Abraham and other Bush administration officials met to discuss the California crisis. There was no immediate word on whether Abraham will extend an emergency order by his predecessor, Bill Richardson, keeping power flowing to California despite concerns about utility solvency. That order is due to expire at midnight Tuesday. Also Monday, White House spokesman Ari Fleischer announced the nomination of Curt Hebert, who has argued against federal involvement in the California problems, as chairman of the Federal Energy Regulatory Commission, which regulates wholesale power markets.
Black Blade: Read the second paragraph for emphasis. No more interruptible power cuts as the limit has been reached. The world's sixth largest economy is headed toward third-world status. Also heard that Intel (INTC) sent a letter to Sen. Diane Fine-Swine that they would not build additional production facilities in Kalifornia under the current energy crisis situation. Looks as if life is definitely going to become "interesting" in The People's Socialist Republik of Kalifornia." So goes Kalifornia, so goes the economy.
NEW YORK -- This week's pending UK gold auction, the penultimate in the current second cycle, has so far run true to form. The market takes its opportunity to fleece Britain's Treasury by shorting the metal aggressively to ensure that it can load up on 25 metric tons as cheaply as possible.
Nevertheless, the auction will pass as a cameo in the greater scheme of things. The price of gold will probably tick up in the days following the auction, but there is an abiding sense of calamity hanging over gold. But for one brief moment in September 1999 when the price per ounce rocketed, gold has spiraled terminally lower for twenty one years.
The impact on gold mining shares has been obvious, but a more important effect has been a steady disconnect from macro indicators once taken for granted. There has been an accelerating erosion of the relationship between gold and inflation, and gold and the dollar. For each year since 1980, the ability to predict inflation in the US via the price of gold has diminished to the point of being nearly meaningless today. Similarly, the inverse correlation between the value of the US dollar and the price of gold has corroded from strong to moderately reliable.
That has important consequences for investing in gold. Investors in the yellow metal have long relied on inflation and dollar exchange rates as markers for the ebb and flow of the global markets, signaling entry and exit points. To do so today is simply foolish. Let's look at the evidence before discussing future implications.
In a previous article, I made clear my case that the relationship between the trade weighted dollar and gold has diminished. That was confirmed in the Euro's recovery to near parity in recent weeks as a result of a weaker US economy that was widely expected to provoke a flight to safety and elevating gold prices. The reverse happened.
As far as inflation is concerned, even in the early 90s, gold was regarded as a reasonably accurate lead indicator of inflation in OECD economies, particularly the United States. Former Fed Governor Wayne Angell once remarked that "a rise in the price of gold is the best signal that we have to indicate that there is diminished confidence about the future purchasing power of money."
Statistical analysis reveals no reliable link between gold and inflation, a view confirmed by the research of Evan Koenig of the Dallas Fed. He notes: "Sustained movements in inflation have often been preceded by similar movements in the price of gold." However, his regression of past inflation rates and gold produced a model with 21 per cent predictive power, hardly reliable by any standard. It's helpful, but not nearly as predictive as bond yields, especially after 1993.
It is clear that gold's relationship to inflation and the dollar is stronger in times of turmoil. During the relative economic stability of the last two decades, gold's indicative function has become progressively less reliable with the advance of time.
That suggests that gold's investment potential cannot be understood in traditional terms. Perhaps gold is best understood as having parallel realities where one is alternately dominant. In times of prosperity and stability it assumes the characteristics of any commodity and is priced according to its utility. In periods of instability, its monetary role becomes predominant and is priced according to its exchange power.
Gold's investment qualities are clearly different in each period and require a bespoke investment strategy. In times of stability a trading approach using proxies like gold mines is advisable while turmoil would favor physical hoarding and trading. At all times it's wise to hold a reserve because the transition from one era to the next may not be telegraphed.
The shift between "realities" can only be tectonic and explosive and that is animating current debate about the gold price.
The Gold Anti-Trust Action Committee is at the forefront of a faction which is effectively arguing that the shift is overdue and is being subverted by a cabal of gold shorts. The case is more compelling than convincing although they have done terrific work warning against becoming complacent about gold as money.
That complacency is everywhere to be seen, perhaps nowhere more clearly than in the reorganization of national reserves. Central banking practice has become increasingly homogenized with the result that gold plays a subordinate role to the major trading currencies. The resulting sell-off of reserve gold, primarily for jewellery fabrication means that very little is available to function as money if a shift occurs.
A financial crisis will attract private gold back into the market as the price rises, but it will not be as swift as the conversions of 1980 and liquidity problems are likely to drive the price higher for longer.
A meltdown is a dream for gold longs, but there's insufficient evidence of an impending crisis. The current potential fracture point is the US dollar which is regarded as overvalued given America's indebtedness and foreign trade deficit.
The dollar's recovery seems to be an acknowledgement that incoming Treasury secretary Paul O'Neil will retain a strong-dollar policy that will discourage possible investment buying. Aside from the policy support, there is still no competition for the US. Japan is in a mess and Europe has structural rigidities that are not going away in a hurry. The US will continue to attract investment flows so financing the trade deficit and keeping a floor under the dollar.
The best indicator of a likely shift between "realities" will be a sustained increase in the price of gold. If the price manages to hold above $320 an ounce for three months we would have the surest indication of gold's revival.
In the first instance, a prolonged price rise would reflect serious investment demand, something the market has lacked for years, and indicate a loss of faith in Greenspan's curative powers. Secondly, three months would throw a mark-to-market blanket over all gold shorts. Unlike gold hedgers Ashanti and Cambior which were caught short circumstantially, a three month price hike would create a systemic crisis generating margin calls on up to 10,000 tons of short metal.
The world's financial authorities clearly have no interest in letting that happen so it's not a foregone conclusion. Until then, there will be brief short-covering rallies that will be blunted by the weight of continued central bank selling and the better returns of other investments.
By: Tim Wood
Black Blade: Interesting. The second to last paragraph is telling. A short squeeze of "epic Proportions."
( and it is nice to hear that, for some, even at today's prices, gold can be highly profitable.
Government's treasure trove map raises the prospect of golddiggers
The Independent - United Kingdom, Jan 23, 2001
A TENFOLD increase in the discoveries of buried treasure has fuelled fears among MPs that important archaeological sites could be swamped by amateur fortune-hunters.
A record haul of valuables, including Roman gold, Viking silver and ancient coins, was found in Britain last year by part-time enthusiasts using metal detectors. About 250 discoveries of gold and silver more than 300 years old earned hunters hundreds of thousands of pounds in "treasure trove" payments last year.
The finds included two late Bronze Age gold neck-rings, uncovered in Chickerell, Dorset and worth pounds 110,000, and a medieval gold pendant with a portrait of Christ discovered in Coundon, Warwickshire. Ten years ago only about 25 finds were reported each year.
A treasure map of Britain, published tomorrow by Chris Smith, the Culture Secretary, will pinpoint where the biggest finds were made and how much they are worth.
But some MPs have warned that the map will serve only to attract flocks of amateur hunters from around the world. Ronnie Fearn, Liberal Democrat tourism spokesman and a member of the House of Commons Culture Select Committee, said the location of the finds should be concealed by the Government.
"There is a real danger that a network of plunderers will be set up and in no time at all we will have hordes of people, not only from this country, descending on areas which have yielded buried treasure," he said. "I am sure that in a few days we will see bottle-diggers looking for relics."
The treasure map shows that Norfolk, Suffolk, Wiltshire and North Yorkshire yielded the most treasure last year. Durham and Herefordshire were the least successful counties for treasure hunters in England. Most of the finds were from the medieval and post-medieval period, although the bulk of gold and silver coins were Roman.
The majority were found by treasure hunters with metal detectors. Only 5 per cent of the finds - including the Anglo-Saxon grave of a warrior in Eriswell Suffolk - were the result of archaeological digs. Accidental discoveries by farmers ploughing their fields or walkers accounted for 5 per cent of the treasure reported last year.
The report on treasure trove will also show that a group of six silver Anglo-Saxon strap ends, made about AD850, found near York, has been bought by the Yorkshire Museum for pounds 18,000.
A hoard of 9,238 Roman silver denarii from the 1st to 3rd centuries AD, dug up in Shapwick, Somerset, was bought by the Somerset County Museum for pounds 265,000.
In Carnforth, Lancashire, treasure hunters uncovered a small Viking hoard of Islamic silver coins and scrap silver made about AD950.
In Bamburgh, Northumberland, treasure seekers dug up 253 Anglo-Saxon silver coins dating from AD850. The coins were bought by Newcastle's Museum of Antiquities for pounds 2,850. And the British Museum paid pounds 50,000 for a silver- gilt statuette of a saint, dating from AD1300, uncovered near Buntingford, Hertfordshire
One of the most spectacular finds was a rare Anglo-Saxon gold seal matrix bearing the name Baldehild. She was said to have been the bride of King Clovis II of France about AD650. The seal, worth pounds 60,000, has been acquired by Norwich Museum.
The amount of reported buried treasure has increased so dramatically the Government is planning to review the Treasure Act to give government officials more help in dealing with the caseload.
Under present law, finds of gold and silver more than 300 years old are official trove and have to be valued by the government's Treasure Valuation committee, under the 1996 Treasure Act. A Whitehall source said: "The massive increase in reporting of treasure helps us to understand our shared history. We are looking at improving the efficiency in dealing with caseloads and how reports are made. The review reports back in the spring."
All Material Subject to Copyright
From Pandagold
PS There is an interesting twist to this. Recently, the government brought in legislation to check amateur 'archeologists (ie., metal dectectorists) Has it stopped them? Not on your Nellie! ('Limey' expression)
You can now understand why our government can afford to auction it off - we have so much of it that the Roman's left us. And its not all in the Bank's vault.
http://www.vdare.com/jbrimelow_WallStChangingCulture.htm "The saga of the Long Term Capital Management hedge fund
- its rise, fall, and the peculiar circumstances surrounding
its rescue in September 1998 - more and more appears
paradigmatic of Clinton Era finance. Esoteric and secretive
in action, operating through special relationships and
understandings, involving greed and ambition on
astonishingly uninhibited scale, and ultimately giving rise to
suspicions of ominous fusion between private commercial
objectives and the formulation of public policy, it lays out a
pattern likely to become all too familiar as documentation of
the period becomes more available.
"Nicholas Dunbar's book Inventing Money: The Story of
Long Term Capital Management and the Legends Behind It,
makes an important and unique contribution to elucidating
the story. Written in London by a journalist specializing in
derivatives, it was actually published some months before
Roger Lowenstein's When Genius Failed (For my comments
see here.). Not benefiting from the mutual assistance habits
of Lowenstein's Wall Street Journal circle, the book was little
noticed. I, like others, only became aware of it via the
increasingly valuable "similar titles" component of
Amazon.com. It is worth the additional effort."
"This leads directly to the question of gold. Dunbar, like
Lowenstein makes no reference at all to gold, not even to
repudiate the rumors of a large LTCM short position. And
indeed such a position must have either been eliminated or
else been very well hidden by the time LTCM was invaded
by hordes of Goldman and J.P. Morgan investigators in late
September '98. But what Dunbar does reveal is very
important: that in the latter part of the 90s, Central Banks
did indeed strike what he describes as "devil's bargains"
with hedge funds, who were essentially hired as
mercenaries to achieve certain effects.
"And they did so in extreme secrecy. So well had LTCM
disguised its activities that the Italians were able with a
straight face to sanction Credit Suisse-First Boston for
squeezing the Italian Post Office bond sale in �96, while its
protege LTCM was discreetly doing the same thing (a
profitable bit of protection for LTCM.) On the evidence of
Dunbar's book, if a major Central Bank had decided it
wished to repress gold, discreet private sector agents were
readily available to perpetrate the deed."
An ideaReferring to the Nostradamus quatrain that you quoted:
(Century III, Quatrain 13):
In the ark, lightning, gold and silver melted.
Of two prisoners, one shall eat up the other,
The greatest of the city shall be laid down,
When the navy that was drowned shall swim.
Couldn't the last line be a reference to all of those who are "underwater" with respect to gold and silver? That would put the interpretation of the last line more in context with the rest of the verse.
>>>======== $272.50 ===========>With most of the major economic indicators having been reported and the Fed meeting a week away all eyes will be n the BOE gold sale today. That should not move the POG in either direction. The wildcard is the power shortage in California, the world's 9th largest economy, and the ripple effects it would have on the national economy. As the week wears on, Bush will probably be given his first major challenge as president to provide a solution.
DJ MARKET TALK: Spot Gold Dn In Aftermath Of BOE Auction
Contact us in London on 44-20-7842-9358 or in New York on 201-938-4435.
1222 GMT (Dow Jones) Spot gold falls to $268.70/oz, from $269.25/oz, in first five minutes after BOE auction. 25 tons allotted at $268.00/oz, auction 4.8 times oversubscribed, from 3.1 times at last auction. (SPM)
1202 GMT (Dow Jones) Any spot gold rally after BOE gold auction seen temporary, unless prompts further Comex short-covering, says dealer. Mkt eyes price, level of subscription. Spot gold at $269.00/oz. (SPM)
Aah�.MK made me crawl from under my little rock�
Note: English is not my mothertongue, so please bear with me.
My brain is not hindered by any significant knowledge of the PM market mechanics,
so feel free to correct any flaw in facts, assumptions or logica.
There has been quite a lot of speculation about where the Fed's and CB's physical gold is stored.
Fact is that, at the advent of WWII, several European CB's have shipped major parts of their holdings to the USA for safety reasons.
In a recent tv-interview a spokesman from the Dutch CB stated frankly that, up to this day, almost all of their physical gold was stored in the USA. He made it sound like that was the only logical place for a.o. (West-) European CB's, considering the turmoil in this area during the last century (including ColdWar aftermath).
So much of this gold is still not returned to their original owners.
Add to that the rumours about the Swiss CB's yearlong fruitless efforts to get theirs back in their own vaults,
then, all of a sudden, the windmills of my mind start to produce highly speculative scenario's.
The original (30's-40's) contracts for storage were made at a time that the dollar was backed by a fixed gold price of $35. It then sounds logical that there was a clause in those contracts that in certain circumstances, this gold could also be paid back in an equivalent of dollars.
Nixon's 1971 (?) decision to end the gold/dollar redemption, could thus have created a very complicated legal catch22 situation, where the legitimate owners (CB's) were no longer interested in getting dollars for their gold, whereas that would be the only logical choice for the FED (or Treasury?) from that moment on.
One escape for the legal owners could then be to simply sell this gold for the much higher free market value.
Could this have been a possible cause that has led to the Washington Agreement that seemed to suddenly have fallen out of the blue sky. Selling it in a disciplined way to avoid depressing the paper market price. And then buying the physical at the same or a little lower price? Controlling the papermarket price would be somehow necessary in such scenario.
Lots of details come to mind if only time allowed. (Is there no such thing as a derivative for time�?)
Could this scenario be a nasty little complicating facet in a smooth transition from a worn out dollar to a new Euro as world currency.
Is there somehow a foundation in there to build upon for an Odyssey of gold into the 21th century? I think so...
---
"Always assume incompetence, before looking for conspiracy." -- Machiavelli.
The general theme, I must have misunderstood. It seemed to me you were drawing attention to all the �theys� as being references to TPTB, which so many posts (including mine) often include, and that you did not believe such malevolent creatures exist.
Well, Pandagold, I did not mean to even infer anything about TPTB, except to show how they, using the media, are capable in dividing the populace into little warring factions, divided over issues fed to us, and so designed to encourage us to "circle the wagons", and become entrenched in our fears and distrust.
Keeping the people divided is necessary, in order to prevent the common people from forming a collective fist, with which to assault TPTB.
TPTB paint themselves into the background of the picture, so as to obfuscate the fact of their existence. Kind of like "OZ", a little old man behind the curtain, pulling the levers of smoke and fire. The US media really never deals with this institution of the Federal Reserve, who owns it, or how it is that a private corporation managed to get control of this nations banking system, and issuance of currency.
In our school systems, children are encouraged to become fireman, doctors, nurses, policemen, and trade workers.
When has any American ever had a course in public school, on how to get a loan from the government, and start a bank?
I think it was one of the Bush clan, that did this very thing. I think it was called Silverado Savings and Loan, and only existed on paper, to my recollection. The Bush kid got his million dollar salary to be the C.E.O. for a year, and then it folded up in bankruptcy. Not Bush, mind you, just the corporation. Where does one learn to do these things? Does the common man even know how to begin? Does our education system even mention these pursuits to the common people?
So you can see how it is that TPTB have painted themselves into the background, so as to show that they dont exist. Anyone who thinks they do is just a leftist extremist, or a right-wing fanatic. Destroy the messenger. Discredit the opposition. Now everyone get back to work, theres no conspiracy, see, we told you so.
Yes, Pandagold, I definitely beleive TPTB exist. The Us vs Them satire was only to show that we are deluded into joining political groups that are a sham, and I wanted such polemic people who post here to see that they are little more than programmed pawns in a fake war, piting citicen against citicen.
There will be a downdraft to this price because the short traders cannot allow a perception that the gold trade will be different under George than it was under Bill. The long traders will fight to hold the recent low price. Perhaps after a week or two of this struggle things will be different.
Well yeaterday I expressed some interest in watching
the BoE auction for a sign. I think the sign is
clear enough.
The auction by policy includes only those who are attempting to buy large amounts of gold for cash.
This has to be a significant factor.
The actual price paid was OVER spot and over the London
morning fix.
These power gold players asked to buy almost 5 times
as much gold as was offered. Let me repeat that another way. Some of the most significant gold players in the world wanted to pay OVER the going market price for gold, by five times the amount offered!
A few trading days ago TPTB would have us believe that
these folks could have bought all they wanted at $5
less per oz. What is wrong with this picture? Is it
possible that the spot market and the london fix are not honest measures of the real price one must pay if one wanted a significant amount of gold. If I am buying one gold eagle, $4 - $5 doesn't affect my decision much. If I was going to buy TONS of gold, a few pennies an ounce would be significant.
So what does all of this mean? I think we all need to determine for ourselves what it means. But predictably
I have my own opinion and I'll share it with you.
FACT: roughly 0.8 Moz sold above spot or fix.
There is still significant demand for actual physical gold. We are told otherwise, but the BoE auction proves that big players take opportunities to buy physical when it is available.
We are told that there is roughly 1.8 - million ounces of gold available for delivery on the COMEX. The demand
for gold at the auction was 3.8 million ounces! I smell a rat. 3.8 Moz demand at higher prices than the 1.8 Moz advertised as available on COMEX. There should be 3Moz of unfilled demand and COMEX is offering it at sale prices!! Does this make sense? NO!!!
I said last week that the steady decline in spot was familiar before the recent BoE auctions. I think I am beginning to see why. It is to get the price down for gold that may REALY be available for delivery. (Or as some suspect, to set the books straight on previous un reported transactions.)
Why don't those who put in bids at higher than spot just call up COMEX and get more of their order filed?
Last thought. Is the spot or fix prices that we see are a sham? Do they want us to believe that that is the real price? Why is it that we can buy a few coins or bars at spot + fabrication but the people who want LARGE quantities have to pay more? Don't the big guys usually get a price break? I have said it before so please forgive me for repeating. The way to screw these folks is to buy the physical at these prices. I cant do much nor can anyone I know. But if a few thousand of us keep buying one or ten or ? oz when we get a chance eventually we will have a few coins for our trouble and the folks manipulating the game will get squeezed.
A NEW WING TO HALL OF FAME: "2001 A Gold Odyssey: Predictions On the Upcoming Year from Round Table Members (As posted late January, 2001)." I wanted to re-post the announcement on the New Wing to the Hall of Fame. It's been a great contest so far with several very strong entries. The New Wing may scare some off, but it may also encourage those with conviction to come forward.
Great to see the new posters. There is a well of information and talent out there that we haven't even begun to tap. Combine that with the pool of talent and brain power already present at this Table and I can safely say "Our best days are still ahead."
Thank you all . . . . . .MK
----------------------
Announcing a New Wing to Hall of Fame . . .
In conjunction with the contest now in progress, I have talked with Randy @ the Tower and we have decided to construct a
temporary wing of the Hall of Fame where all the contest entries will be enshrined for the duration of 2001. I suggest we call
this wing "2001 A Gold Odyssey: Predictions On the Upcoming Year from Round Table Members (As posted late January,
2001)." The winner and runners-up of course will be specially honored as they should be. The "Exhibit" will remain open until
December 31st, 2001 and we hope that the Table Round will find it a source of discussion (and yes, Auspec, even amusement)
for the duration. Under the circumstances and in the interest of fair play, anyone who has already made a post and would like to
alter it, we welcome you to do so. Please send a note to the sitemaster with the message number you want included in the Hall.
If logic EVER enters the minds of those who manage such things, who among them can logically subscribe to a strong US$ policy under the present circumstances?
It's almost a daily occurrence for large cap US company's to warn of profit shortfalls - the likes of Boeing are regularly getting knocked off by Airbus - comparative advantage is now talked about in terms of months rather than decades etc.
A quick look around my "enclave" reveals not one US made gadget, both non-pentium machines, screen, printer and scanner, are all locally assembled Asian manufacture. A look in the Garage reveals a Austro-Nippon hybrid steed and a British "thoroughbred".
Glancing out on the Mooring we find a "custom-built" MotorYacht as we Aussies of REAL worth look upon ANY "production" watercraft as rather crass! (NB Trail Guide) (OK-OK, the last one was wishful thinking!)
The point of this exercise is to highlite how "uncompetitive" the US has been of late due largely to the "strong $ policy" - I would gladly fill all my nooks and crannies with US manufactured product, the problem is,
...."it's too friggin DEAR".....
And.....sadly....the NEW administration appears content to further sell US export potential short (with all the ramifications of same) for ONE reason only.......
Bank of England Press Release -- for the Record -- "H M Government Gold Auction Result: 23 January 2001"
http://www.bankofengland.co.uk/pressreleases/2001/009.htmThe 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 $268.00 per ounce. Details of the result are as follows:
Amount of gold on offer (approx.) ---- 803,600 oz
Amount applied for ---- 3,852,400 oz
Times covered ---- 4.8 times
Amount allotted to bidders ---- 805,600 oz
Allotment price ---- $268.00
[Randy's note: this is notable because it came in above the London AM Gold Fix which was $267.10. At this time I cannot tell you how many participants put in bids even higher than $268, but I can tell you that there were five entities who bid for gold at precisely this price, each of whom then received only one-third of the gold they were seeking (see the scaling factor below). Those who bid more got their order filled in total, those who bid less got nothing.]
Scaling factor at allotment price ---- 35.8035%
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 25 January 2001.
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 fifth auction in the programme of six. Auctions were held on Tuesday 23 May, Wednesday 12 July, Tuesday 19 September and Tuesday 7 November 2000. The remaining auction in this programme will be held on Wednesday 14 March 2001.
I wonder how many of you take the trouble to look into the backgrounds of the people who control the CB's and financial institutions around the world - in particular our, so called, Western Democracies.
Reading your postings, I would say almost none.
If you did, you would see there was a very strong link. There is something, which binds them, far stronger than their �apparent� national identity.
I hate to get at you fellows, because I know you are all trying, and wanting, to understand just what is going on.
But, and I know here I am going to upset a few of you (perhaps a lot of you). You are so brainwashed by the system, that you don't even know it. You think you have free minds, but you don't. Research those backgrounds and observe those links � some direct, some indirect, but links they are.
You are like a crowd at a wrestling match - oohing and ouching with every, what appears to be, painful hold, or arm blow.
It's all just a game, A GAME! That painful grimace (unless there has been an accident), or, uttered, hateful remark is not to be taken seriously.
It is just the same in the political arena. Most of these guys are buddy, buddies, and drinking and laughing with each other later at their favourite watering hole, or associated lodge. They 'joust', hurl insults, and decry for your entertainment (because that is what you expect) and to give the whole charade some authenticity.
Like in all groups of humanity, even within close families, there are some personal genuine dislikes, but this is often not to do with what side of the political fence they are sitting on, but often to do with ego's, personalities, and just plain positioning.
As you will know, even among Arthur's Knights, and Robin Hood's band of merry men, there was rivalry and jealousy.
But they were united in one cause. They thought and fought as one when the chips were down. Note that - because THAT IS THE KEY! Once again � THAT IS THE KEY!
This 'brotherhood' extends beyond national boundaries. Before we go any further, I am not referring to anything Masonic. The fact that most of them are almost certainly masons, as were the signers of the US Declaration of Independence, most US presidents (excluding |Kennedy) and the vast majority of world political leaders, is not the real cloth, which binds. Though it is used by the 'elite'.
In case there are doubters amongst you, about the strength of these oath binding relationships, there are a number of recorded incidents during military engagements like the American civil war, and American revolution, where an opposing officer's life was spared just in time by him giving the brotherhood sign, and which was, fortunately for him, recognised by his victor.
Someone mentions about the Dutch and other European, or from wherever, sending their gold 'for safe keeping' to the US. My dear fellow knights, they pass this stuff from one to another, and sell and buy for each other with well-orchestrated movements. They have highly professional choreographers. They are wizards at manipulation, and subterfuge.
Most of all they have international media at their disposal. Even the media may appear to compete with each other, and so they do � up to a point. But when they are required to stand as one STAND AS ONE THEY DO.
In spite of what you may think, knowing this is not going to change a thing. They are not going to get their �comeuppance� (whatever that is) one day - at least, not this side of the 'Pearly Gates'. And they are not afraid of that, because, to them, heaven and hell is right here on Earth. There is no life hereafter. To them, THIS IS IT!.
The reason I am trying to get this across is not that you should worry, but that you should stop wasting time and energy trying to figure out, and make sense of the political, or economic scene. Things like - 'Bush said, or did this, Clinton said, or did that. The Belgian, Dutch, or UK Bank sold some gold, sent some gold, bought some gold bla bla. It can only make sense when you know and accept what they are up to. You have to understand the game plan, just as you only need to know THE TREND when investing.
These trivialities only have very small relevance, and almost certainly not the one that is put out for our consumption.
There is a clearly defined plan for a world order. Most influential nations are cooperating, whether they appear to be or not. Why, because the people who really shape their destiny, and almost certainly have control of their finances are 'bound' together (tightly). Agreed, there are some nations yet to be brought fully into the fold. But it is only a question of time.
Can it be stopped? A big resounding NO!. Not unless Christ returned to Earth and His Father allowed Him to win this time. But this is to assume what is happening is not God's wish. Alternatively, there is a world holocaust in which most of us perish and life starts again and there are enough people alive who have understood the cause, and are determined not to allow it again.
Neither of these options, to be honest, appeals, as they both scare the hell out of me for different reasons.
Whether, in the final analysis (I have said this before) it will be a good thing, I do not know. Neither do they, they just believe it will, and that it is their destiny to bring it to fruition. I merely pray to God, they are right.
The Federal Reserve adds more reserves to nation's banking system
Half collaterallized by agencies, half by Treasuries and mortgage-backed securities, the Fed today participated in two-day repurchase agreements to add $2 billion in temporary reserves to the banking system.
Further, the Fed saw fit to add another $481 million in permanent reserves through outright purchase, seeking bids on U.S. Treasury Inflation-Indexed Securities coupons (for dates from July 2002 - April 2029) to be delivered Wednesday.
When you eventually discover that you need/desire it most, you will either have gold, or you will not. Your actions "today" will determine your fate. None other will act for you....but Centennial stands ready to assist you. Give them a call.
Quite a first post, Sir! You have many windmills turning now -- I know I will go through today pondering those long-term entanglements that WW2 left us with. Europe under occupation, U.S. plans to replace European powers with its own, U.S. makes Europe a storage offer it can't refuse.
Decades later, the parties attempt to wriggle their ways through the "loopholes" in those contracts, while not a word breathed to the public. To what point?!?
By some Occam's razor of simplicity, your outline fits much of the known factual landscape. Say on, you and others, on this, and let us see if this explains the CB selling/taking up scenario very well.
(Dutch? Our new comrade reminds me of Belgian and his sharp insights. Something about growing up near all that tulip-fertilized soil? With some ancient abbott's gold buried just under the next hill?)
Almost total agreement but less than total control @Pandagold msg#: 46226
Hi Panda!
I nearly agree with almost everything you posted in your msg#: 46226 on "Backgrounds." This is highly unusual for me.
Except I think you way over-estimate "their" effectiveness. Most of humanity's delusions of control come from pre-chaos theory (now "complex phenomena") thinking, usually rooted in the analogies developed by physics.
Because physics was so successful, in what some writers call "physics envy," economists, sociologists, etc. tried to adapt the older pre-quantum physics models to their subject fields with less than spectacular success.
The euro has stumbled through. So far. But without a sick dollar, how far would it have gotten?
What we see here is what has always been seen in history when irredeemable paper replaces gold. These results are best described by Andrew Dickson White's 1912 classic, Fiat Money Inflation in France:
"Thus was the history of France [during the 1793 paper
currency debacle] logically developed in obedience to
natural laws; such has, to a greater or less degree,
always been the result of irredeemable paper, created
according to the whim or interest of legislative
assemblies rather than based upon standards of value
permanent in their nature [gold] and agreed upon
throughout the entire world. Such, we may fairly
expect, will always be the result of them until the
fiat of the Almighty shall evolve laws in the universe
radically different from those which at present
obtain." p. 109
What we've been seeing ever since 1913 is mad scrambling crisis management to maintain the current "establishment," attempting to over-come the previous mistake of ancestors abbrogating gold for relatively quick profits. But to hell with posterity. Or, I suppose, "they" could have made the mistake honestly.
France scrambled. The U.S. scrambled beginning in 1929 thruout the depression. Recently Asia scrambled. Russia scrambled. Brazil and Ecuador scrambled. Argentina is scrambling, and it looks like U.S.A. is about to again.
The delusions of control the NWO folks had have been crumbling and will continue to do-so because even an atomic clock, one of the most precise instruments ever developed, gets out of sync with it's siamese twin over time. And economics, containing as it does more than a dollup of "psychology," isn't anywhere near as precise as an atomic clock.
In particular and even in the relatively precise field of physics, prediction is difficult, especially of the future. It's not much different for NWO folks. Even Greenspan only claims 60% accuracy.
Open your eyes, Panda. TPTB indeed heavily influence many things, but they are far from "in control." Things are much too complex for that.
Else you must really fear: Who would engineer an Asian contagion that no one anticipated? Etc.
Regards,
Journeyman
P.S. Your observations on how we should view all the details of this and that media fad are spot-on!
More than three years ago, discovery of the sacred cubit
utilized for constructing the Ark of the Covenant was
announced. In October 1997 on Yom Kippur (the day of atonement), Freemasonry published its finding in the
"Suffolk Mason," shortly after renamed the "American
Mason;" address: P.O. Box 645, Sag Harbor, New York 11963.
The cubit (measure) utilized is the British/American twelve
inch foot! The measurements of the Ark's dimensions "speak"
its story in cosmology; Sun, Moon, Earth = Father, Mother,
Child - Spirit, Soul, Body ... and so forth...
.. Also, the Cherubim molded into and upon the mercy seat
relate to the four fixed signs of the Zodiac - see
Ezekiel's vision; see also John's vision in Revelation,
where John was translated and saw into the throne - 'in the
day of the Lord.' He saw the Ark and the four living
creatures - Lion, Ox, Man and Eagle.
"And it shall come to pass, when ye (Israel) be multiplied
and increased in the land, in those days (i.e. days of
restoration), saith the Lord, they shall say no more 'The
ark of the covenant of the Lord:' neither *shall it
come to mind: neither shall they remember it; neither shall
they *visit it; *neither shall that be done any more. ..."
(Jeremiah 3:16-18)
Notes:
* shall say no more, 'The ark', &c. The ark was till
in the land in the days of this prophecy (2 Chron. 35:3);
but it was to disappear with the broken covenant, of which
it was the symbol.
* visit it. This is conclusive of the fact that it was
burnt together with the Temple (as it is not included in
the excepted things, in 2 Kings 25:9, 13-15), not
withstanding the Jewish tradition recorded in 2 Macc. 2:4-
8, and the impossible stories of its being taken over to
North Africa, Contantinople, or Ireland.
* neither shall that be done, &c. = neither shall it be
made any more. It disappeared together with the covenant,
of which it was the symbol (8: 9; 12:7. Ps.132. 13,14). The
reason follows in verse 17. The Lords throne will be
substituted for it: the reality will take the place of the
Shekinah.
These notes excerpted from The Companion Bible, p.1021.
These notes were written by its author in the year 1912,
and he passed away
in 1913. Therefore, the author had no knowledge of the
present restoration of Israel. Nor, did he know the Ark's
construction was measured to reflect our solar system - the
heavenly spheres. A true visionary.
http://biz.yahoo.com/rf/010123/n23458109_2.htmlBond prices rise (signalling increased demand) in the face of expectations of an event that would surely lead to a "shrinking" of these bonds....meaning, purchasing power upon maturity that is diminished by an inflated dollar.
EXCERPT from the article:
NEW YORK, Jan 23 (Reuters) - U.S. Treasuries [prices] rose on Tuesday as expectations Federal Reserve Chairman Alan Greenspan will continue to slash interest rates buoyed shorter notes while long-term bonds rebounded from a two-day slide. ....The powerful Fed chief will address the Senate Budget Committee on Thursday, and traders anticipate he will prep the markets for an aggressive interest rate cut next week aimed at keeping a slowing economy from a deeper slump.
----
Go figure.
The set-up for disappointment began last week, with the release of the COT report indicating a tremendous long position by Commercials, hand in hand with a tremendous short position by the Specs.
Then yesterday, we saw the artificial run-up in the XAU, an increase of some 6%. The run-up raised hopes of many small gold investors as it usually foreshadows an analogous run-up in the POG.
Then this morning the news was even brighter, with the BOE results indicating that bidders attempted to buy FIVE TIMES as much gold as was made available in the auction. So much for the fraudulent claim that nobody is interested in gold today.
Yet, the BOE's gold "Dutch Auction" is designed to ensure that the LOWEST BID succeeds as the final sales price, so we may only guess at how high the bidding went for some of the gold metal. That is because the BOE's gold auction was designed expressly to SUPPRESS the price of gold, not raise it, and it is categorically clear that the BOE has aided in attempting to cap the gold price on behalf of major international bullion bank "friends" holding huge short posiitons in the metal.
SO what are we left with this morning? A large number of disillusioned gold longs, many who are dumping their gold stocks this morning.
In that sense, the auction served its purpose, by providing more gold at artifically suppressed prices to the gold shorts, who are in a hole they cannot escape from...and providing them with cheap gold stock shares from weak disillusioned longs who capitulated this morning. No doubt gold short extraordinaire Barrick Gold or its fellow partner in crime, Anglogold, are happy as pigs in shit, as they can aim their sights at yet another depressed gold miner, and pick them up for pennies on the dollar. Such has been the strategy of the leading gold mining companies, aiding and abetting a financial conspiracy of gargantuan proportions.
However beware drawing attention to the anti-gold machinations of the bullion banks as they will respond with blank stares of bewilderment, and in the manner in which they persuaded millions to pour monies into dot.com tulipmania and ruin their lives, they will deny the existence of all factual evidence, instead providing all variety of rationalizations for gold's demise that constitute no more puff fantasies.
So what is the solution for forever demoralized gold longs?
How much patience can anybody muster in the face of a financial establishment that dissembles the obvious Truth within the world of gold?
When does gold rocket to a price that accurately reflects its true equilibrium value?
Of course, there is no way to know definitively when that day comes. But it is categorically clear that we are on the precipice of a major financial earthquake, that is not merely the ideological belief of "goldbug-ism," but rather the simple reality of a super sized debt economy, whose fulcrum (the US Dollar) is slowly and steadily weakening, thus discouraging foreign funds inflows into domestic markets...while at the same time, domestic inflows rapidly dry up as national unemployment ramps upward, thus diminishing the supply of domestic funds for indigenous capital investment.
In other words, gold is heading for the stratosphere, at any moment, and there is no amount of jawboning and propaganda that will prevent that.
The gold shorts are bankrupt, not tomorrow, but today, and there is nothing they can do about it. It is karmic inescapable fate, and one that is well-deserved.
Of course we know who "They" are, Pandagold. We ARE "They". (Or is that "We IS 'Them'"?)
We're keeping mum to get you going.
We just want to find out who YOU are, and what you know...
( * * )
.( > )
..( (__) )
...~~~~~~
(First attempted "Big Smiley" graphic on USAGold in how many years?)
And, lest I offend, I shall include my "serious note" herein: If you're talking about the publicly-researchable "backgrounds", then you most likely are referring to memberships in private international organizations that most of us have heard of previously, to which most U.S. Presidents and their high administration officials have belonged. And yes, the coincidence is impressive, but we have not simply accepted the conclusions of various authors and theorists.
The conclusions about their agendae, their resulting "effectiveness", possible theological undercurrents, and what we peons ought do about it all, are the discussions we have been having Stateside for some years now. There are many strands to dealing with the possibilities of such discovery, and a healthy individual will try to set out upon a measured pace, in good, trustworthy company.
It is upon such a journey as this that one begins to wonder if one knows the difference between a closed mind, an open mind, and a mind so open that everything gathered immediately falls right out...
Voodoo Economics; My answer to Cavan Man's question.
I don't think it's hard to understand what is happening with gold today. All one needs to do is read some Keynes, and finish up with Alan Greenspan's "Gold And Economic Freedom" (1967). I think this would be sufficient basic knowledge.
It's so ironic that Alan Greenspan, who authored one of the most insightful short papers that any economist has ever written in "Gold and Economic Freedom," in which he exposes the welfare state and it's relationship to gold, has somehow been seduced by it, and become its chief executor. I cannot answer the question as to why Mr. Greenspan defected, I'll even allow for the possibility (albeit a small one) that he might even have positive designs to shape a brighter future.
I will take a stab at Cavan Man's question as presented by MK: "Why doesn't he do something?" But first, I must tell you, during the past two decades my efforts at 'saving' have been mocked, and so too have been my beliefs, so I want to reveal by whom and why.
The reason Mr. Greenspan doesn't do anything, (here comes my stab) is that in order to attain and maintain his position, and the perception of the many that he is the most powerful man in the world, it was required of him by his superiors that he take an oath of allegiance to uphold the doctrine of 'Voodoo Economics.'
Following are some examples by which I substantiate my claim that Mr. Greenspan, who at one time, as MK stated, "was one of us," is now of this other school.
"My main concern today is with a permanent improvement in the international monetary
system. But I cannot refrain from making a digression to speak about the sagging euro. I do believe that two measures would be of great help. The first would be for the European
Central Bank to put a floor to the euro against the dollar. And because the future may bring the other problem of a too rapid fall of the dollar, I would put a ceiling on it as well. I would start today with a floor at 85 cents and a ceiling at 115 cents, but over time it would be possible and desirable to narrow these levels substantially. Of course I am aware that such bands will require that monetary policy take account somewhat of the balance of payments and the exchange rate. Optimally, intervention should: (1) have a clearly-stated objective (e.g., support the floor or ceiling); (2) take place in the forward as well as the spot market; (3) not be sterilized; and (4) be concerted with partners."
Robert Mundell (winner of the Nobel Prize for Economics)
Comment: Are these the words of a "free market" economist, or the mumbling incantations of a practitioner of 'Voodoo Economics?'
The metal gold might not possess all the theoretical advantages of an artificially regulated standard, but it could not be tampered with and proved reliable in practice."
John Meynard Keynes
Comment: Keynes might just as well have said, "If it is our intention to tamper, then we must be rid of the gold standard."
Mercy, do these men tamper. In fact, they are the greatest tamper artists of all time. So much so, that a major city in Florida is named after them. And furthermore, "they" have even "arranged" it so that the Super Bowl is being played there this year! Journeyman, I would like your opinion---- Can the "Raven" truly be perched upon the shoulder of gold after having served as the ultimate store of wealth since the beginning of recorded history? Or perhaps you think it wisest and most prudent to walk in the footsteps of "Giants?" You really don't have to answer Sir Journeyman, although there are many that would pay close attention if you did. (LOL)
Sorry for the digression, back to Mr. Keynes.
" A Gold standard means, in practice, nothing but to have the same price level and the same money rates (broadly speaking) as the United States. The whole object is to link rigidly the City (London) and Wall Street. I beg the Chancellor of the Exchequer and the Governor of the Bank of England and the nameless others who settle our destiny in secret to reflect that this may be a dangerous proceeding" JMK
Comment: I think what we need is "Ghostbusters."
"The reader will observe that I retain for gold an important role in our system. As an ultimate safeguard and as a reserve for sudden requirements, no superior medium is yet available. But I urge that it is possible to get the benefits of gold without irrevocably binding our legal-tender money to follow blindly all the vagaries of gold and future unforeseeable fluctuations in its real purchasing power" (huh!) JMK
Comment: Well I never! Do the insightful words of Edward R. Murrow apply here? That "The obscure we see eventually, the completely apparent takes longer?" Couldn't Mr. Keynes see, that "all the vagaries of gold and the future unforeseeable fluctuations in its real purchasing power would be caused by what he terms "our legal-tender money"? Or was he just preaching 'Voodoo Economics?'
More Keynes��.."If the Federal Reserve Board intends to maintain the value of the dollar at a level which is irrespective of the inflow and outflow of gold, what object is there in continuing to accept at the mints gold which is not wanted, yet costs a heavy price? If the United States mints were closed to gold, everything, except the actual price of the metal, could continue precisely as before. Confidence in the future stability of the value of gold depends therefore on the United States being foolish enough to go on accepting gold which it does not want, and wise enough, having accepted it, to maintain it at a fixed value. This double event might be realized through the collaboration of a public understanding nothing with a Federal Reserve Board understanding everything."
.
Comment: Remember "Ethnic Cleansing" and the Balkans? We are now in the process of an attempted "AUric cleansing," so let us not stand by idly and allow this crime and injustice to the world to continue. This is not about profits, they are secondary, (so now you know why most of my acquaintances hate me) as something more important is at stake: This is about GOOD and EVIL. There is a dichotomous nature to man's soul, and each person knows innately which rules his/her mind and heart. And so as it benefits EVIL to travel in disguise, it's best for the GOOD to likewise not reveal their true self, for evil seeks to 'destroy' good, while good only wishes to 'understand' evil.
I think it was Edmund Burke who said, " The only thing necessary for evil to triumph, is for good men to do nothing." GATA is doing Something, Bill Murphy and friends have shown they are relentless in the pursuit of truth.
(Late edit: Pandagold, your assessment is right on, but are you suggesting we do "nothing" and hope they are right? Is what is going on in the markets, including gold "right." Are abrogations of freedom, mass murderers in the second half of the 20th century, epidemic high school shootings in a cultural landscape created by their policies "right"? How long do you want me to go on?)
Who ya gonna call?
P.S. I ain't afraid of no ghosts. (this sentence is a lie)
NY Fed Reserve President gives green light to inflation
http://biz.yahoo.com/rf/010123/l23239761.htmlNY President William McDonough offered a window into his mind when he told the European Parliament's Economic and Monetary Affairs Committee, "There's a tendency sometimes for central bankers to be too uniquely involved in fighting inflation rather than realising that economic growth is what it's all about."
Sure, he gives necessary lip service to price stability, but it is precisely that when faced with competing interests/objectives. And given the size of the U.S. federal government, "pushing on a string" becomes somewhat easier to do...like a frozen rope. Do you grasp this properly? Perhaps now you can gain insight into the real meaning behind the Treasury Department's mantra regarding the "strong dollar policy". It is an internationally directed signal to foster confidence in future fiscal austerity regarding, specifically, issuance of new Treasuries.
Make no mistake. "We shall have the hyperinflation."
In false anticipation of Greenspan's imminent magic, gold will be sold down for the expected needle infusion into the US equity markets as per the late January Fed meeting. Only after January 26th will investor sentiment turn to gold and precious metals as the Fed easing turns out to cause the rally to fizzle. "Silver first" because the silver market is in a better position to move due to its larger short position and smaller inventories. A sharp move in silver may be a precursor to a rally for gold.
Makes me think of the ways in which a "King" can manipulate his subjects. King Canute could not order the tide to recede, but other "kings" have, and do, order their subjects to labor upon ridiculous projects, building only the king's ego and monuments.
Kings have ordered the building of dykes to hold back the tides. Now, that works, as long as the laborers are willing to keep them up.
WW2 created a national unity and solid loyalty to the U.S. Federal entity. This loyalty (subservience) would be written on the Asset side of any controlling elite's balance sheet.
The labor of U.S. taxpayers, as well as their savings and now those of speculative worldwide investors, can be conscripted via the Fed (dollar), Wall St., and USTreasury, to weigh in on whatever cause it is temporarily needed. Not forever, as gold is forever, but to sustain a scheme that will allow the knowledgeable to escape with the greatest appropriation of resources.
Gold is a solid asset, but so (temporarily) is the capitalized labor of a brainwashed public. One can be set against the other as needed, in order to accomplish a more profitable objective. The anthill model of society, very useful, eh?
I support your theory that silver will move first ( I mean, significantly) We are apt to think movement of a couple of dollars in gold at the moment is movement because it has been 'dead' for so long. This only deceives us, and gives false excitement.
It will also be a good sign that gold will move soon after. For gold to stand alone would be a littele too embarrassing for the manipulators. Having said that, they are so brazen and hard faced these days because they have made themselves 'untouchable' that I wouldn't put anything past them.
In a strange co-incidence for me,this is almost the exact same debate I had with close friend;just last night.There is something out there, there is no doubt about it.On this aspect we could agree.Just what is it? That's another story.
In my opinion,our collective destinys are by driven by a force or forces which are creating the unexplainable peramutations in so many financial markets; not just the gold market.The big question is:
a.Do "they" have a controlled, all-encompassing plan that is unfolding as scripted?
b.Is the plan wobbling and getting off kilter.Perhaps different players are now pursuing conflicting directions?Are the use of paper derivatives in so many markets,not just the gold market,reaching the end of their effective timelines?
c.Are "they" now just flying by the seat of their collective pants.
Time will tell,truth will always win out in the end.It's just that sometimes the wait is so agonizing.
does not upset me. Indeed I agree with most of what you said. It is a conspiracy of circumstance at best, at worst (and I feel most likely) a multi generational cabal skewing the perceptions of the public regarding all that is gold.
Forthwith, I can only speak from an American perspective.
Gold represents greed. (Never mentioned is that gold is VALUE since it alone possesses a global track record of 6000 years of INTRINSIC WORTH! Unbridled greed in my opinion is reprehensible, however greed is undeniably a major motivating factor behind the "success" (as imperfect as it may be) of capitalism.)
Gold is antiquated and serves no purpose in a modern economy. (We've probably all experienced this bias, perhaps even to the point of being called "flat earthers". Some of us may try to mask our true motives and thus gain acceptance back within the fold by buying and collecting antique gold coins for their love of the "numismatic and historical" qualities! The rationale for the CBs holding gold is never explained, Fort Knox is at best a euphemism for the term "impenetrable", and the POG is no longer routinely given to the public in the financial reporting on the evening newscast.)
Gold is evil. (This could take forever to list examples, so I'll just stick with those of a more modern (i.e. liberal) sensibility. Gold mining ruins the environment! It trashes the landscape, poisons our rivers, shakes baby bunnies in their dens during midday slumber, enslaves and oppresses third world workers, etc., etc. This also is how one profession (geologists) is increasingly portrayed as evil personified in the entertainment media, whether searching for gold, oil, uranium.....while invariably being greedy, murderous, agents of exploitation, etc., etc. The future trend is "positive" though, since all the bug and bunny worshippers have made domestic exploration and production nearly impossible, we are now graduating legions of new geologists, the ENVIRONMENTAL GEOLOGIST, repleat with red cape and blue tights with an emblazoned EG on their chests.....ready to work.....for the government!)
Enough of my venting. Please excuse my rantings. I'm off to load more wood in the stove.....wood that I cut, hauled, split and stacked......wood that used to be the home to winged marvels of bird and insect ilk, and cute furry mammals in need of extensive, protracted orthodontic care.....wood that created nuts....and shaded the hippy nuts so intoxicated with each others body odor....wood that will now warm my home.....while spewing lethal carbon dioxide to assure global warming.....so I won't have to heat my home by.....cutting, hauling, splitting, and stacking wood ANYMORE!
I'd like to teach the world to sing, in perfect harmony, perfect harmony..............
derivatives: are they all a "short" on the dollar, in some fundamental sense? (In other words, all denominated in dollars. "If I win, I collect. If I lose, I hedge again and hope for a reversal/bailout.")
Are some of them a bankrupt's "Hail Mary" bets?
Pandagold: the tight range of gold's trading. Of course the dollar or two moves are economically insignificant -- unless someone has bet some high volumes on very tight spreads. I am still curious to see some stats gathered on the tightness of the trading ranges intraday within the long downward slope. Did gold used to have 2% variations intraday regularly ten years back, and now you find only 1/2% variations with the same frequency? Know what I mean? Mark of control...
(I used to track this for stocks -- 1994 seemed the most low volatility year in memory, followed by the now-legendary breakout.)
When you see stats like ~$8 trillion in new debt brought only ~2 trillion in GDP growth, you know that disproportionalities abound and are accepted by the moguls at the top. Is one of them: It takes 5x as many gold contracts written now to move the price down a dollar? (But they're now at this late date contracts not written in all economic seriousness of having to pay off with your own real $?)
@PandagoldAgree with you but for one point when you ask " Can it be Stopped?. And the answer is a resounding NO. "
I disagree with that one. Because nothing is eternal. And it will end up in disaster. Not only for them but for all of us as well. It will be our punishment to let ourselves put to sleep.
And to all those who read, but did not respond (hope you didn't head for the bunker)Life is too precious.
First let me say I appreciate all who have responded to my last posting. I am aware it was a little controversial and perhaps touched a few nerves. But, I assure you all, my intentions are well meaning, and I respect all of you, and your opinions, plus I can well understand if you find this, and other of my postings sometimes a little hard to accept.
The theme of the message can be disturbing, almost like being told you have terminal cancer. If that were the case, what do you do about it? What can you do?
You can pray - that you won't suffer too much, or that they will find a cure pretty quickly, or that the doctor was mistaken. Or you can just get on with your life, what is left of it, and enjoy the important things and stop worrying about those stupid silly things that took up your mind, time, and energy before.
I looked at all of your comments, and I can see that you are all way off beam. This is either because you genuinely are not able to 'see', or, as Mr Gresham puts it, you are just trying to draw me out to get me to confirm what you really believe.
Now I know my fellow Knight Sir Gresham, says he knows, but I draw him out (tiltmy lance) by the challenge that I don't believe he does.
This is wonderful verbal jousting, isn't it Sir Gresham.
In my time I spent teaching, I found that if you gave enough pointers and allowed the student to apply his/her own research, and reasoning, the student would eventually
draw the right conclusions. They would then be his/her conclusions, and would be accepted.
It is perfectly all right to be explicit about hard facts, things tangible like in science and physics. Even then, the students must conduct their own experiments, before their mind can truly accept.
Then there are other parts of science, or mathematics from which a 'factual' statement can be arrived at but, because of its immensity is difficult to comprehend and accept.
For example: There are more molecules in one teaspoon of water, than there are teaspoons of water in the oceans.
or, There are more stars in the universe than grains of sand in all the beaches of the world; or, If someone offered you a billion dollars if you would hand count it for him, you would have to decline, because you could not live long enough - even if you had a full life ahead of you.
I know these things, and I say yeh, that is so. But my mind struggles to accept. I would still strain to have a go at counting that $billion( just joking)
So, I will not be drawn. I am not being flippantly evasive to give a feeling of superiority. You tempt me, however, I have given you one of my reasons, but there are others.
The POG has been trading within a very narrow range over the last few weeks and I think the trend will continue for at least the next 3 days. With today's auction out of the way, one could be forgiven for thinking that the POG should rise given the 4.8 times oversubscription but the shorts won't let that happen, with the price slowly declining as the week progresses.
I believe gold will break out in February/March after an interest rate reduction inspired stock market rally proves unfounded. The dollar will then resume its recent downtrend after putting in the October 27th high. Investors will begin to sense that a deteriorating dollar environment (resulting increased inflation), lacklustre stock performance, and then treasury yields heading back up will signify the growing probability of a recession in 2nd half of this year. They will lose confidence in Greenspan's ability to contain the markets. Foreigners are/will continue repatriating funds as the dollar falls against other currencies (primarily D-mark, S-frank, B-pound & Euro). Investors will once again focus attention on the troubles in the Middle East and repercussions for oil. Futures prices for gasoline will start to reflect the needs of this coming summer. Investors will begin to also focus on personal & corporate debt that has been growing at almost twice the pace of GDP since 1994. More articles will be written by the news media concerning the reduction in home equity due to debt consolidation of credit cards and speculation in the stock market. Key to all this will be the dollar. It's my feeling that the fed will continue inflating the money supply to attempt a soft landing and to minimize stock portfolio damage - a 180 degree approach to that of Japan who's aim was to protect Japanese savings. This will act to prolong the bear market in equities into 2002 or so.
All in all, I see 2001 as being the year that gold will break out for many various reasons. And of course when it does, it will go much higher than expected by the majority because of the large short position held by banks, financial houses, producers, and speculators. I see it easily hitting $600, retracing to around $400 before hitting $800 plus by 2003 - 2005. What we have here is a wonderful opportunity to buy and hold.
All things being held constant (and continuous monetary expansion is roughly a given in this regime), whether or not we have high inflation rates/hyperinflation ultimately depends upon whether the average Joe retains his job and is thereby able to continue borrowing, or at the very least able to service past debt obligations.
If FED et al can manage the economy without massive layoffs, then high inflation rates can be sustained. This does not imply NO layoffs, but perhaps additional increases in unemployment of between 5 and 10 points. The math requires simply that "enough" workers are still gainfully employed to keep the game afloat.
But a downturn of larger proportions, either badly managed (or beyond management), with unemployment rates reaching into the 15%+ range will preclude sustaining inflationary dynamics. In this case, I believe the opposite will occur - deflationary effects in nearly all areas. FED will try to avoid this, as it more seriously runs counter to the banking/finance industry's interests, i.e., inflating away their assets is largely preferable to driving an unmanageable proportion of their assets into default and/or bankruptcy.
It's an interesting debate, the outcome of which is still not at all clear. On one hand, the entire basis of the fiat monetary system consists of continuous above economic output trend debt expansion, i.e., monetary inflation. On the other hand, the banking system goes further and further in the hole the higher the rate of monetary inflation and the lower the rate at which debt is offered to the marketplace, all the anti-inflation psych-ops and manipulations notwithstanding.
FED whould like to keep us in perpetual limbo between the two: inflate enough to offset the increasing real weight of debt burdens, keep loans rates low to enable the debt expansion and debt servive, yet keep economic activity high enough to allow absorption of some of the really bad loans over time. It can't be done. The sheer, exponentially-increasing weight of the balancing act will swing the system to an extreme sooner or later. FED will attempt to guide towards inflation, if possible. Yet, "if possible" may not be possible. And even then, the lesser of two very bad outcomes is still a very bad outcome. Either way, FED's immediate clients, banking and finance, will not escape unscathed.
On net, when the piper is to be paid, most of the country, including the banks, will be better served going the inflation route. Savers and those on fixed income will be ill-served (so what else is new under a fiat system). Gold should hold its own should the price suppression ever end. Just maybe the suppressors are waiting for the same thing -- an answer as to which way the system will tilt. And under deflation, where all debt is suspect, money, real money, is THE asset to hold. There is no money more real than gold. Unfortunately, here in limbo, gold has few friends, some disinterested parties, and many enemies.
As others have pointed out, one cannot give a meaningful reason for estimating the POG at one small moment in time, and fairly close to the date of estimation, except that if there has been little or no volatility, it is reasonable to expect it to be near what it is at the time of the estimate.
However, many have taken this option, as would be expected. What I propose doing, therefore, is to give my worse case scenario, as above. My reason for so doing is one of �hedging� (a sensitive word I know here in the castle precincts).
You see, most of my money is riding in the hope of a soon higher gold price. Therefore, if it swings the other way, more than I would like to expect, at least, I will have something to look forward to.
I haven't been able to go back and see all the contributions, so I have taken a guess that I am the lowest. I couldn't bring myself to go any lower, I tried but it was too painful.
Personally, I've been waiting for the price of gold to rebound for the last two and a half years and in the interim I've witnessed a whole slew of circumstances which had the potential to trigger such an event. Other that the Washington Agreement, which blindsided most people, nothing of any significance ever happened. Even the explosion following the WA quickly subsided. I'm probably preaching to the converted, but there are powerful forces (people) at work who think there is more profit to be made by a declining price than a climbing one. Things are complicated even further by the fact that the Clinton administration presided over the last eight years and so many strange events took place that were never adequately explained that it's easy to believe that a fantasy island mentality was orchestrated.
Now that GW is in the White House, will things change? Poor George is caught between a rock and a hard place because if he tampers too much with the institutions and policies that I believe were set in place to foster the la la land mentality, the whole thing will come crashing down and he will be the scapegoat.
So what's going to happen? If I could predict the future with any accuracy, I'd have been off sitting in the sun somewhere long ago instead of shivering in the cold but I'll give it my best shot.
The US economy is actually the entity caught between a rock and a hard place because the economy is slowing and there are not many options available to turn it around. In fact there are probably only two, which are mutually exclusive - keep the dollar strong or lower interest rates. The fed has already indicated their inclination to lower interest rates and another 1/4 or 1/2 point drop has been predicted before the end of the month. That should help to keep things going for a little while longer but the American people are so far in debt that it isn't going to prevent them from tightening their belts and sitting it out for a while, especially as the fear of job loss has reared it's ugly head again. Slowly but surely, the economy will go into recession and the US equity markets will continue into a sustained bear market. This will in turn cause the US dollar to decline as foreign investors look for other means of asset growth or, more likely, preservation. Whether this will all happen this year is still an open question, but it will happen before things turn around. The other option, to keep the dollar strong would also keep things going for a little while longer but the eventual decline would be much more severe and be more difficult to contain. So, the US had better steel itself for a decline in its economy and its dollar no matter what actions TPTB take.
What will this do for the price of gold? Well, at some point the serious investors (and later the masses, who always miss the boat) will awaken to the fact that gold has been so suppressed for so long that, at the very least, it would be a good vehicle for wealth preservation and may even show a profit while the world rights itself. When every other market is in decline, where else can people put their money and have any hope of preserving their wealth. The explosion in the price will come when the masses start to jump on the bandwagon, as happened in 1980. They'll be a little skittish at first because they've been burned so many times in the past. Then greed will take over as always and away we go. When will this happen? I wish I knew. But I'm a patient man who has followed this forum for over two years now, and I believe that the tide will turn our way as inevitably as the ocean tide turns. If I was pressed, I would predict that the price of gold will pass $300 by late summer and continue on an upward trend from that point onwards. Will it surpass its previous record within the next two years? I doubt it but who knows how quickly and serverely the tide will turn?
... You will learn the Answer on Wednesday ...As usual, it seems everyone in the Forum is depressed and
disgusted with POG's dismal performance once again, today,
as the Gold Shares and Futures were pummeled.
This is the usual fare, and the BOE auction is just a small part
of the SetUp for the LetDown. Do not be fooled.
Who was it that said: "There's a sucker born every minute".?.
Many Lurkers and Posters come here to (somehow) learn the
answer to one single paramount question:
"When is Gold going to go UP.?."
It's a reasonable question to ask. In a Gold Forum. Especially.
Okay. I will give you the difinitive *exact* answer to that
elusive question, in a very short post I shall make, after the
markets have closed, on Wednesday of this week.
You will have your Answer after reading it. Here. In this Forum.
Now that's unfair. I won't sleep tonight for excitement - or is it apprehension. I am wondering shall I mortgage my home ready to back it to the hilt - or head for the hills to escape my creditors. Honestly Thaigold........
(Is it BUY tomorrow or BYE BYE?)
It's like the night before Christmas Eve when I was a kid.
John Doe, splendid post. Thank you for adding your elaboration
I perceive us to be very much in agreement on our view of this. I find the important crux of the issue in your words here:
"...deflationary effects in nearly all areas. FED will try to avoid this, as it more seriously runs counter to the banking/finance industry's interests, i.e., inflating away their assets is largely preferable to driving an unmanageable proportion of their assets into default and/or bankruptcy."
Yes, the banking system must/will be "saved". Whether readers like it or not, modern society is incomprehensible absent modern banking. No honest thinker can imagine a future world without business loans and home mortgages.
Where I see the Fed losing its desparately delicate balancing act is waiting off-stage in the wings...in the unmanageable flow of the "overhang" of foreign-held U.S. debt securities. As a shrinking dollar erodes the real value to be received at maturity, early discount selling could touch off a selling panic among those holding for the here-and-now principle value.
I see into the future the U.S. currency/banking system continuing along its modern (fiat time period) path based ever more on commercial debt and less on government debt....shades of meaning behind my prior post today on the Treasury's "strong dollar" policy.
It is in the course of this transition and workout phase, particularly given the movement potential for "hot money" as has been accumulating for years as we spent freely. We always knew there would be a day of reckoning, no?
Thank you again for your contribution. I hope this is not interpreted as obscurring or equating with your view where we may differ. I encourage readers to give full thought to your excellent post to better know your mind. With this I have only endeavored to further share mine from a starting point of common ground.
Waiter: "...and for you, sir?"
Uncle Sam: "We shall have the hyperinflation."
Waiter: "Very good, sir. It's the only thing on the menu."
In order to obtain the maximum amusement value for the forum readers in Jan. 2002, this 2001 Odyssey is written in the past tense.
The year began with the first of the Alan Greenspan FED panic interest rate moves and George "Dubya" Bush assuming the presidency. Bush pushed through a tax cut to the relief of Wall Street, and the stock markets responded with a temporary reversal of the bear market that had crushed the NASDAQ in 2000. The honeymoon ended by late summer, however, despite several more FED panic interest rate cuts. The bear returned with a vengeance as several notable large-scale corporate bankruptcies shook Wall Street and the world markets. The populace of the western world finally learned what that old saying "pushing on a string" meant.
The year 2001 was an infliction point for the gold market, marking a 20 year bottom and a sharp reversal. It was quite stunning for the 99% of the western world who believed the "barbarous relic" story that the western press had told for years.
In the first part of the year we saw heavy increases in the paper gold short position every time the Fed lowered rates. The hedge funds believed in the fictional "Greenspan put" as they leveraged their index fund and currency positions with short paper gold positions. It had worked for years and they had faith in Black-Scholes and their trading programs. They just weren't quite ready for the lightning strike that hit in the autumn of 2001. The sharp drop in the US dollar and a string of bankruptcies devastated the bond market, which brought on the now-famous cross-cascading derivative defaults. The lack of liquidity and caused all those major banks to close their doors until the merger legislation was passed. Alan Greenspan really met his match when the longs asked for delivery on those 125,000 COMEX gold contracts!
Of course, the astute USAGOLD readers had plenty of time to exchange their now-devaluated Federal Reserve notes and now-worthless mutual funds for gold coins, and they lived happily ever after.
The speculators in the hedge funds will hammer the price down and run some sell stops at the COMEX this week. On Friday afternoon, buyers of physical will happily purchase their gold coins at an exchange rate referenced to the paper gold price of $261.90 per troy ounce.
I did not say such a thing, Sir. Because you would not be specific, then I was forced to be conditional: "If you're talking about the publicly-researchable "backgrounds", then you most likely are referring to memberships..." blah, blah, blah. "If" and "most likely" do not assert certainty.
I assume that others can see my point in that, if you alone possess data that is NOT publicly-available, then we have no other means to get it than from you. If it IS readily researchable, then I submit that many of us have already run across it, and so some in your "class" deserve credits for prior study and are ready to move on. It is you, Sir, who do not submit your thoughts to verification by this method.
It is irritating to talk in riddles and at cross-purposes with one who bears his lance at my side. I would meet your challenge, but I do not know whether I must send my Squire to check if your lance be capped, or no.
The attempt at a "Big Smiley" was for you, my friend, for if this assembly hides its knowledge from you, it will be coaxed out better by the good humor you have shown us than by bombast.
John Doe, I like your style. You have captured and conveyed a sense of the balances and imbalances that are being watched from high places, and strategies awaiting new trends for their implementation.
It occurs to me that the overwhelming accumulation of debt, as Randy reminds us, forecasts a situation in which that debt will be MOST difficult to service. That scenario would be stagflation, in which money supply drops, but prices of all basic goods rise, leaving next to nothing for debt service.
In other words, all dollar-denominated markets are now being priced for massive debt default and dilution of real savings and confiscation of weakly-held wealth. Conversely, bullet-proof "workout" vehicles are probably being devised by financial players to hold and gather real assets through the firestorm. ("Excuse me; do you mind if we play through?")
Ho! Boy!, We are getting ready to go for the ride of the century and we are depressed. There is a sucker born every minute,and every two minutes taken. P T. Barnum. When is gold going up? Hope not too soon. Least till more of the small time investors (STINS New Acronym) get to buy piece by piece the gold on the market. Increasing the demand for physical gold. Thus really puting one up the central bankers KAZOO!
Inee Beanee Jelly Beanie, The Spirits Are About To Speak. Are They Friendly Spirits? Who said this?
Slingshot
Sir Gresham, I addressed your reply to me in good spirit, and in context. You claimed you knew who 'they' were in your opening statement. You also inferred you were just probing me to find out who I was and what I knew.
Everything I know is available to all and sundry in written form, or observation if you keep your eyes open. I am a mere fellow Knight on the golden quest.
I speak not in riddles sir, but I give pointers. If you want to know what riddles are then read Nostradamus.
With many writers, especially on sensitive issues, you have to learn to read between their lines. This is how I have gained my knowledge. I don't find it irritating. I am so sorry that you obviously do.
If it is the feeling of my fellow Knights, then I can find alternative things to do than share with you. My horse is waiting, and I can ride off to tilt at windmills perhaps, or find some fair damsel in distress ( or datstress)
Randy, my overriding point is that inflation, even relatively high, manageable inflation, would be FED's best outcome, but is not in any way assured. Your assessment, a tip into hyperinflation, I believe is the next most likely scenario. However, chaotic dynamics may well drive us into depression instead. Gentle deflation, that "sweet spot" of banking, prudent borrowers, and long term savers, is a total impossibility for at least the next several decades. That mode was cast aside some 87 years ago, apparently as "less than optimum."
Mr Gresham, stagflation would be the best the system could hope for. At least then one's home value has a chance to outrun the inflation rate, as long as one has an income source to make the payments with the same amount of ever "cheaper" dollars. And even then, variable rate loans will catch more than a few if rates eventually begin to rise to "combat" the stagflation. Early 80's rerun -- get out the Duran Duran records.
It's ironic, the lender tries to make up for ever-cheapening dollars by exponentially increasing volume/quantity, and the borrower takes them up on it, assuming a continuously declining quality of the money supply, which forces the lender to lend even more. A symbiosis cast in hell. Heaven forbid either party reneges.
Well, now we are into the second week of the electricity crisis which is plaguing the Golden State. Headlines in every newspaper jump out at you, Nightline with Ted Koppel has already covered the topic on a couple of occasions, CNN features a new development hourly. The most reasoned (and fear-inspiring) discussion was last Friday's front page article in the Wall Street Journal. In said article, the illustrious Diane Feinstein, Democratic senator from la-la-land, was musing about the financial fix that Pacific Gas & Electric and Southern Cal Edison find themselves in. Knowing as she does that both companies are heavily indebted to Bank of America and Wells Fargo to the tune of billions, the prospect of default and/or bankruptcy was discussed. She said the ramifications of such an event would reach well beyond California's borders into the international market place, i.e. the bond market and the foreigners who finance our massive spending habits. So against the backdrop of voices clamoring for the two utilities to go bankrupt (and thus supposedly allowing the people to buy their energy cheaper without having to pay someone to produce it), it was strangely refreshing to see hers as a voice of restraint. Allowing default and bankruptcy is like driving the limousine into a pothole large enough to swallow the entire car. We conservatives have to give the liberals some credit: When it comes to liberals, even they are smart enough to protect the limousine!
I had an old Gran who had lived through two wars � or was it three. I was only little at the time but I remember her saying that you could always tell when a war was coming because they played lots of military music on the radio before hand.
Whether this was true or not, I don't know, but it sort of stuck in my mind.
Well, today, we have TV. In fact, round the clock TV. And what I have noticed is an increasing amount of world war 2 movies and documentaries. � particularly about the Nazis. They all seem to be there just to emphasise one particular part of it. It even crops up in so many other programs, movies etc., which, some, on first hand, seem un-related. Yet, you can almost feel it coming, and sure enough, you are not disappointed. You almost feel that only certain people suffered in that war, and that that was what it was really all about.
So I ask myself, why are we getting all this sixty years afterwards. Small doses could be understandable, but it seems to be increasing at an alarming rate � even articles in the newspaper.
Someone I thought , is getting awfully worried. Someone knows that the conditions are about to be inflicted on the world economies that caused what happened before to happen. again.
It's just a thought. I hope to God I'm not right.
(well. ThaiGold, I thought, if I'm not going to sleep well to night, why should you)
I see we have fallen prey to Internet Dis-Interpretation. Yes, I doubted the wisdom of some words I chose, and of course now would strike them if I could, having failed to convey the spirit in which I intended them. (When I think of the adjectives that might be tossed my way...!) Please forgive any ungentlemanly harshness.
I tried to express my satisfaction in your company, and how I value your contributions. I state that here, in repetition, as plainly as I might. Continue with us, please, for as long as wisdom prompts you.
I thought: "Could I not help you in opening up your own chosen topic to others, knowing less than you, but observing your method from the gallery with a critical eye toward improving it?" Now I doubt my ability to add much on this, even as a friendly questioner.
My statements of "knowing": ("Of course we know who "They" are, Pandagold. We ARE "They".") was a "we're watching you, Number Six" (remember Patrick MacGoohan on "The Prisoner"?) humorous attempt to poke at the paranoia that keeps people silent on the topic of certain "conspiracy theories." Not a poke at you, Sir, for you have revealed more of yourself than others have in this regard. My humor was meant to walk that line between revelation and concealment, believing that our fellows feel many different things along that spectrum, including fatigue.
In sooth, I despair at the powers of poor words (all that we have here) to convey more than the grossest of agreements and disagreements. I must learn those "smile" symbols some day soon, but my Manual of Style must be out of date. Can you not accept this less-than-perfect hashing-over of today's mumblings and go on with our journeys?
The US dollar, the 'people's' stock market or NASDAQ, and the American economy have all tilted downwards and are currently sliding toward the middle of nowhere...and all three could break sharply to the downside at any time...my guess though, is that this will not occur for the next 1-3 months.
Politically, the US citizenry are still breathing a sigh of relief with the recognition that Bubba really is gone and is no longer in place to act out his sexual conflicts on the world stage, to the humiliation of his country. At the same time, the highly undervalued and IMO even more highly unknown quantity [so no wonder many refer to him as W, as one with only a sliver identity], hasn't been in place long enough to show his hand.
However if will not be long because financially, the California Crisis is front and centre and it now appears that it will be the first domestic test of the new presidency. No matter what dynamics become clear...and my guess is that George Senior will be pulling the strings...the method deployed in dealing with the California scenario may be very telling and may in fact be the prototype for the style of management seen in the next four years. Again just a guess, but I expect to see any socialist trimmings to be sharply cut and an entrepenurial style to emerge...if so, the solution will be quick and sure and definitely not painless.
As for gold, there will be little change in the next few weeks but I expect the fundamental issues to more determine its price by year's end...as the invisible hand deftly sifts and sorts out the garbage.
A good sense of humor will make the ride that much more enjoyable. Rocky the squirrel said, Are they friendly spirits? I don't know about Hi Hat. Hope to see him in the BAHAMAS after the gold rush. I can hear that island music.
slingshot
And why you say...because I feel that we are overdue for a little bounce. Plus emotionally I do not feel optomistic at this time...which tells me that I should be a buyer right now.
I've tried to think of these BOE auctions from a bidders perspective. I often get myself going in circles.
We have heard (in the early auctions; not so lately) of producers bidding for the BOE gold. Remember the successful Gold Fields bid in auction 1 or 2. I am certain Anglogold has bid and I am fairly certain Placer has bid. Who knows who has bid and who has successfully bid.
Question:
Why aren't the unhedged miners not boasting of their bids successful or otherwise?
"Yeah, we put in a bid of 5 tonnes a couple dollars below spot to see what happened; hoping the lowest acceptable bid was there"
Why aren't (some of) the hedged miners not boasting of their bids?
Placer, "We are reducing our hedged exposure (as per last Feb) so we put in an unsuccessful low-ball bid; maybe better luck next time"
Why aren't the unhedged miners not 'ramping' up the 'subscription' rate. Boast up the subscription rate.
Franco-Nevada has a bunch of cash, "Yeah, we bought a bunch, taking it off the market, maybe sell it down the road at a much higher price"
I realize that the above is simplistic but instead we get nothing? What's up with that? Why don't the bidders tell us?
I'm sure some are secretive short-covering monsters, hmmmm, maybe all the bidders this morning were freaks? (shorts)
And finally, the lowest acceptable bid was above spot. If these (4.8 times) multitude of freaks are all bidding above spot it makes you wonder why they are chasing the BOE's physical so hard!!! I wonder what the highest bid was and even more interesting, who, Chase? Morgan? GS? ABX?
In HK after Singapore , found diamond in PT set ring and au ring yesterday a few silver and a couple of hundred of
fiat. Eating wineing & dineing to the max. Oh its a hard life . No time to chit chat right now , take care all :).
Ski, Auspec, Saxulum^, Farfel, Old Yeller, Ross L, WAC
Ski, Auspec, Saxulum^, Farfel, Old Yeller, Ross L, WAC
Ski: Thank you for the compliment. Now if I could just be right once in a while, it would be very helpful!
Auspec: I certainly wouldn't want to keep gold in Fort Knox. As I recall, it was built in the 30's and was probably adequate for its purpose at that time. But today, with some 20 or so nuclear suitcase bombs in the wrong hands, the "Goldfinger" scenario becomes a real possibility. Undoubtedly some spooks figured this out long ago and moved the gold to safer quarters. Now the only question is whether we can get it back from the spooks when we need it, or have they sold it and built "spook heaven" with it.
Saxulum^: Regarding CB gold. Seems to me I read on this site or elsewhere that US year 2000 gold exports were enormous and were not true gold exports but NY FED gold being returned to rightful owners disguised as exports. Perhaps they have doubts about the survival of the FED and were getting there gold off the ship before it sank.
Farfel: Have always enjoyed your posts enormously. When will gold achieve it's true value? Hmmm. Let's see. The last BOE gold auction is March 14. Hint hint, nudge nudge.
Old Yeller: Does the cabals plan wobble? I'd call LTCM one helluva wobble. They're very good at emergency medicine. They're certainly not perfect. They ain't God though they'd probably like to think they are.
Ross L: Could the last line of the Century III quatrain be interpreted your way? Sure, why not. But I have noticed a strong tendency for people to want to rationalize these types of predictions into a homogenized whole. The human mind wants things to be rational and make sense. I see them more as chaotic dreams or "stream of consciousness" a la James Joyce's "Finnegan's Wake". People seem afraid of these types of predictions in part because they don't make rational sense and because of the difficulty of correct interpretation. Accept the chaos and don't over interpret is how I prefer to see them.
WAC: You are far more knowledgable on the Ark of the Covenant than I. It certainly is an interesting topic. A search on "Ark of the Covenant" can be particularly fruitful and intriguing. Some claim to have located one or the other of them with pictures too! I use Metacrawler and Google for searches. Also very interesting is a book written by futures guru Larry Williams in which he recounts his adventures in Saudi Arabia locating the true Mt. Sinai. Great read. I forget the name but it's something like The Sinai Myth or something like that. I recommend it to all would be Indiana Joneses!
==============> $267.50 <==============
My guess for Friday. TPTB is still firmly in control so it's as good a guess as any. Even a small rise in the price now threatens the shorts per Don_L over on GE.
Good night all.
I feel that the price of gold is going to go up but the gold goons will kick it in the head once more. I believe it is due to to up higher but the resistance is at $275. While the closing price of 265.90 as of today 1/23/2001 is lower a
funny thing keeps happening. Because the amount of shorting done in the market, the resistence level keeps dropping. It has to keep dropping. I noticed this in 1999 when no matter what gold would not go above $315. The Washington Agreement had The Powers That Be (TPTB) running scared and to fight it the gold goons had to fight it with paper. That paper dropped the price to $300. And then $290, $285, $275. There has been an awful lot of papering going on since the start of the year And as much as the gold goons would like to beat down the price to unconsciousness. They can't. One reason.
Too many bargain hunters out there. I doubt many people understand gold derivatives and the paper market or any of the other tstrange things going on out there but they know a bargain. Before I heard any of the strange going-ons I was considering getting some gold coins. So I did the most basic research. I found out on average it costs about $350.00 to mine and selling for for $310. You didn't need to explain anything more. I gone as much as I could afford. Then the price kept dropping and I got the education in the
secret gold marketplace and the goon hammering it down. The goons continue to hammer at it and the resistance price keeps dropping lower and lower. I believe so much papering has been done it will drive the price the short need to continue to $250. If $310 was enough of a bargain for me can you imagine the serious cheapstakes out there. Ever go to Filene's Basement in Boston when they had a big sale. Them little old ladies will KILL YOU!!! You don't stand in the way of a bargain hunter and the bargain. At $250.00 gold will be too much of a bargain. Even through I am max out on what gold I can buy, The day, I see $250.00 is the day I pawn everything I have and buy gold! Those gold shorts
don't have a chance of fighting all those bargain hunters. These cheapstake will willingly drive up the price to $300.00 because even at $300. it still is a bargain. But for the short a price of $300 will be a disaster! They will put the BIG STOMP on gold. They don't allow it to rise more than a dollar a day. But the fact they made it such a bargain will catch them by surprise. The price will leap and then fall as the stomp is applied. It will probably go up to $287, get mugged and started falling to $280 by Friday's close.
The weekend is when it gets interesting. For while gold can be slapped around as if Moe on a rampage, silver has been gathering strength. For now it stopped but it hasn't really fallen. I predict it will go to $5.75 an ounce. And that will be the price level for it to explode! Then things will get interesting.
Gold screaming higher will expose phony CPI,PPI, and all other phony inflation numbers. Nobody pushing paper can allow that to happen. Can you imagine true deficit if Social Security, Medicaid payments would float up 10 - 20% annual? I am bullish on gold because the hound dogs from hell are descending on fiat. Until they attach teeth to posterior the cabal will literally do anything to stop gold. As a side note if I win I will donate a portion to fix the pothole Marketalk mentioned to avoid Limosine Liberals' limo getting swallowed up .
This week I think the tide will turn for the spot gold price. The Euro vs. Dollar battle rages on with gold kept in range, so far, by the gold paper shorts. But I think I see some chinks in the damn: 1) The BOE auction, oversubscribed with bids over spot. Was that a last chance to cover for some shorts who will now be scrambling to get out of the game? 2) The Fed, slashing rates and pumping up money supply like crazy in the face of inflation. How long can they delay the looming defaults that frightened AG into that surprise 1/2 pt. rate drop. 3) General pessimism among goldbugs. IE: An obstetrics nurse told me she had learned from long experience that when a woman in labor says, "I want to go home now.", you can be sure the birth will come soon.
So why was my guess only around $270.00? Because it's just the beginning of gold's release. Many forces are still against it. But I think that's the ECB's favored gold price.
Hoping many months of lurking is leading to some understanding.
simply me
Canuck asked in (01/23/01; 18:49:29MT - usagold.com msg#: 46275) why unhedged miners aren't boasting of their bids successful or otherwise.
Perhaps it's because if they boasted about it, they or the UK Treasury would have to explain how the UK Treasury fixes the prices at its auctions. If it's really the lowest bidder, I would offer 1 cent per ounce or per tonne. To me it's not clear how the UK Treasury arrives at its prices. Neither is it clear to me how the bidders determine the price they will offer.
What got my attention in the Gold_Eagle post which I copied in #46222 is the fact the price was higher than the LBME prices. My intuition had always taught me that since at the auctions demand exceeded the supply, the price at the auctions had to rise above the LBME prices . The Gold Eagle post drew my attention to the fact that, if need be, there's the cheaper alternative of the lower-prices (in case the auction price exceeds the LMBE price) of the LMBE. (call me a slow thinker!)
Perhaps the price of gold could go up (and thus provide an answer to ThaiGold's (01/23/01; 16:24:20MT - usagold.com msg#: 46254) (When, *exactly*, Will Gold Go UP.?))
when we'll get some insight into the price-fixing process (GATA, are you listening?) by the public authorities, i.e. HM Treasury, at these auctions.
Last week's events in Manila (ousting of President Estrada and swearing in on Saturday of the Vice-President after the impeachment court gave on Tuesday 11 votes to 10 a biased judgment in favour of Estrada preventing the prosecution to invoke some pieces of evidence) could perhaps provide the blueprint for the gold rise. After 4 days of demonstrations in Manila, Estrada was forced to quit. The reason why he was forced to quit was that the populace was bewildered by the judgment.
Your question was why unhedged miners aren't boasting of their bids successful _or otherwise_.. Perhaps those whose bids were unsuccessful could expose their bewilderment. Wasn't the aim of the BOE to fix the prices? So why do they fix it above the market price? Alternatively, the unsuccessful bidders could argue that they offered an higher price and still their bids were unsuccessful.
But it would not surprise me that all the bidders get their turn at the auctions and each bidder gets some gold at a different auction. This would mean that both the suppliers and the �demanders� are colluding. How does this fit into Section 1 the Sherman Act? Or should we invoke monopolization as provided for by Section 2 of the Sherman Act and as opposed to article 86 of the EU Treaty which prohibits abuse of dominant position? Are the BOE and the cabal colluding to monopolize the physical gold market on the supply-side and the demand-side?
You nailed the whole market story we're gonna read someday: "These cheapstakes will willingly drive up the price to $300.00 because even at $300. it still is a bargain. But for the short a price of $300 will be a disaster! "
For the year 2001, gold's spot price as established by the LBMA will thrash around between $250 and $275 for the first 6-8 months as the Dollar vs. Euro reserve currency battle rages on (with the Euro gaining inch by inch) and paper gold continues to fight it's losing battle. Also, throughout most of the year, the world's medium to small investors, who've finally given up on the US stock market, will be trying one investment vehicle after another and finding little satisfaction (I think the big boys already have their investment transitions complete.)
Sometime around the end of summer...as the Euro strengthens and US$ weakens to parity, the US stock market fails to sustain one rally attempt after another, and US inflation and job lay-offs begin to make front-page news...silver and gold coin sales will begin to climb dramatically in the US.
At this point, though the official gold spot price stays within range, we may see higher premiums as the paper gold and physical gold prices begin to part ways.
By the end of the year, US economic news will include stories of how good the economy is in the Euro-zone, the Middle Eastern countries put the finishing touches on their one-common-currency agreement (which is heavily gold & Euro backed) and announce a transition date, and China announces the grand opening of their free gold market.
The drama will not be over by the end of 2001, but those who've been following FOA/Another and USAgold Forum will no longer debate whether gold will rise, but by how much. There will be more talk about the price of physical gold and not so much quoting of the LBMA spot price. One gold ounce will be priced around $350-$375, while the paper gold futures will trade in the $300 range.
The beginning of 2002 will see England joining the Euro block (earlier than expected), and the beginning of the end for the LBMA (evidenced by a widening gap between LBMA spot and physical prices, while the USA begins to debate whether we are in a recession or a depression.
Gold was told she would be set free from her USDollar prison in the 1999 Washington Agreement. In 2001, she will take her first breath of fresh air since Nixon closed the gold window nearly 30 years ago. And by the end of 2002 she will be Queen of Money once more.
This twenty-year low for the price of Gold has been achieved by a basic dynamic of market psychology. The more unbelievable the price decline, the more demoralizing to sentiment and the stronger the negative momentum. We have seen, in this recent history, a body politic ignoring the will of the people to a degree never before approached in the annals of modern democracy. They have controlled the POG with impunity to enable their cohorts to conduct the trading activities necessary to protect their positions. They have not had to buy physical gold to do this. As negative sentiment holds the price of gold down and leaves all rallies suspect, larger quantities of covering long positions can be purchased without pulling up the price.. The same margin leverage that creates massive short positions also serves to acquire the longs. It is the writer of those long contracts that will eventually be caught short by the breakout. These purchasers have, so far, locked in their cover price for a small fraction of the funds that would be necessary to buy the physical. Squaring off the short sales has been merely a technical financial matter. This can only continue as long as the �System' is still in place. When the volume of futures trading increases substantially and consistently, we will be in an �end game' and this historic buying opportunity will be brought up short. (pun intended)
The beginning of the end may be at hand. In the last few days there has been a widening circle of perception that there is a watershed change in the type of "leadership" (commanders in charge) that control what is permitted behind the scenes. The following excerpts from recent posts are indicative of this.
ET (1/23/2001; 5:21:37MT - usagold.com msg#: 46210)
>>> John Brimelow --- saga of the Long Term Capital Management hedge fund - its rise, fall, and the peculiar circumstances surrounding its rescue in September 1998 - more and more appears paradigmatic of Clinton Era finance. Esoteric and secretive in action, operating through special relationships and understandings, involving greed and ambition of astonishingly uninhibited scale, and ultimately giving rise to suspicions of ominous fusion between private commercial objectives and the formulation of public policy, it lays out a pattern likely to become all too familiar as documentation of the period becomes more available.<<<
And >>>>This quote from the French finance minister, Laurent Fabius, was included in Bill Murphy's Midas commentary of January 19th. -- "I have always considered the idea that the American economy had discovered perpetual growth naive. The conditions we've seen for some time now, including the lack of savings and external trade deficit were inevitable financial negligence wrought by the over valued dollar. I know, however that the new American administration is well aware of these games and is capable of acting pragmatically in close coordination with Alan Greenspan. The group of seven meeting in one month will give us the possibility to discuss these questions." <<<
I am suggesting that the lights may be being turned on in "the boiler room." This raid on the price of Gold was able to occur in a uniquely licentious period of political history. Indeed the acceleration of the decline can be seen to have begun about the time that Clinton was re-elected and no longer had to hold back for fear of losing an election. I submit that only in this extreme state of permissive impropriety could this abuse of rules and regulations flourish unchallenged.
I predict that the re-emergence of at least some semblance of ethical standards in the new leadership will significantly lessen the ability of the behind-the-scenes manipulation to carry on. What would follow would be a higher "equilibrium" price for gold.
I don't think we are going to have the "melt down" due to the credit and market bubbles. Aside from the NASDQ, the markets have spent twenty-one months now above and below a flat-line median. The Dow, for instance, has a line right through the 10,600 level, and at the moment swings a bit above and below in an orderly fashion. Consider how much stock is now in the hands of recent owners who are more or less even. I also believe the credit bubble will be deflated by "new loans for old" as lower interest rates improve the ability to service debt at the expense of the receivers of interest income.
That leaves a Gold market able to recover gently at first, which is what even the bad guys probably want. Absent the panic of major crises, Gold will most probably back away from first the $280 level and then the WA $340 before creating any legion of true believers. The year-end could fall either side of that second psychological overhang.
How fitting it is to label the course of Gold an Odyssey.
Odysseus, (Ulysses in Latin and Gold in Kosares) set forth from his victories of winning the Trojan Wars, (Iliad) (Days of Gold as Money) and visited the land of the lotus eaters (credit purveyors) whose magic food (receiving before earning) makes people forget their homeland. (Honest exchange) Odysseus sets sail for home but is captured by the cyclops (1933 Confiscation) He escapes (re-legalization of Gold) but is blown off course (London gold Pool) and lands on the island inhabited by Circe who changes his men into pigs, (1970's asset inflation profiteering) and made Odysseus her lover. (Gold @$850) Some of his men stole and ate the sacred cattle of the sun, (sold their Gold for profit and spent it) and as punishment the ship was destroyed and the men drowned. (Recession, and the S & L disaster)
Now Odysseus has been a prisoner of the sea nymph Calypso, (Gold/Yen Carry Trade) for several years. The god Hermes ( EU) makes Calypso release Odysseus (Washington agreement) but the sea god Poseidon (Cabal) causes a storm and he is shipwrecked on the island of the Paeacians. (England, LBMA and BOE)
The Palace where Fair (Trade) Penelope awaits him has been occupied by a "group of unruly young noblemen (Fiat currencies) who want her to assume that her husband (Gold) is dead. They demand that she marry one of them." When Odysseus returns to the palace he is disguised as a beggar. (commodity) The noblemen are having an archery contest, the winner to marry Penelope. (Become the reserve currency). But Odysseus throws off his disguise, (shows himself as monetary gold) kills the noblemen (fiat currencies) and he (Gold) and fair (trade) Penelope are reunited!
-----
2001 will most likely not see "The return to the palace." Gold must sail past the "Siren Calls" that cloud men's minds with false fantasy. But Odysseus will be lashed to the mast be the bonds of words of truth spoken to the world on this Forum. This year should see Gold clear of the straights and past the headland, the wind again filling the sails, pulling towards home and Fair Trade Penelope
Today's dip after the decent auction showing was probably the absence of some demand that was directed into the bidding. I expect the improved political climate and it's accompanying optimism for more fairness in the markets, will begin to show up as a positive sentiment for gold. The week should close out somewhat higher then today's price bot not that much yet as market tests the waters.
Thoroughly enjoying all the great anecdotes and reasons for the Gold Odyssey and Friday POG contests. My meeting with a friend yesterday, put all the astute observations gleened from the forum, on inflation, recession, manipulation, POG, etc, into perfect understanding.
He and the sweeter half both working at about 11 tenths to bring all the ends together, running each day for the race he seems to be loosing. Stressed to the max, along with about everyone else in his environ, and to add to his upset about the new refrigerator that was sitting in the middle of the kitchen when he came home from work (salesman told his wife it would fit - it didn't), the front door was to have been repainted by professionals. (It wasn't - something about the trim not done correctly) The price of $300.00 for painting the door did not appear to bother him, as much as the incorrect trim job. (I think he got trimmed - heck, my back door has had eight winters worth of snow stacked against it) Quietly I reached into my coffer and procured a Double Eagle, which I told him was roughly 1 oz. pure gold, that could be had for a bit less than his paint job. The look of abject confusion on his face was worth a silver eagle. There existed a knowing, yet unwillingness to comprehend, what was for he and I, a profound lesson in inflation and value.
So as to Friday's FERN reflection - cheap, as long as it's less than a door painting.
Salutations
IronHead
PS. Hi Hat, they don't have doors in the Bahamas do they?
There is a shortage in oil coming thanks to Saddam slowing of oil shipments. While the slowdowns happened in December
Due to shipping and refining, it won't hit the marketplace till late Feb / Early March. See the link above for details
This will cause oil to go to at least $40.00 a barrel.
The second is silver
The price of silver has been going up slowly and the short are going to have to come up with some silver. Only the silver bank is running dry. The government probably think is has more inventory than what actually in the vault. Lat year handy and Harman went bankrupt. They held 2.5 million
ounces of silver in their vaults for the U.S. Mint and that silver is GONE. But I would be willing to bet the Government is still carrying that inventory on its books.
Now what happen when you think you have more morey in the checking account than you actually do? You overdraw your account. The government is about to overdraw it accounts
thinking it has 2.5 million ounces of silver than it actually does.
What happens when you overdrawn your account? You pay substancial penities and fees. Your bank has service charges and you have to pay $25.00-$50.00 to the store where your checks bounced. The govenment is about to pay that price and pay it in gold.
If the price of oil shoot up and the silver goes to the moon but gold goes nowhere, that people are going to start buying
gold as a bargain because silver and oil has gone, gold will be any day now.
US issues last order on Calif natgas, power supply
http://biz.yahoo.com/rf/010123/wat023063.html WASHINGTON, Jan 23 (Reuters) - The Bush administration and California Gov. Gray Davis have agreed that Tuesday's extension of federal emergency orders requiring energy firms to sell electricity and natural gas to California's utilities will be the last. Energy Secretary Spencer Abraham on Tuesday issued a final two-week extension of the supply orders, which expire on Feb. 7 at 3 a.m. (0800 GMT). ``Governor Davis agrees with Secretary Abraham that, having granted this request, no further extensions will be necessary,'' the Energy Department said in a statement. In his extension order, Abraham asked the California Independent System Operator, which oversees the state's electric grid, to submit progress reports by Jan. 29 on California's efforts to reduce electricity use during peak times. ``Our action today is designed to give the Governor, the California Legislature and other relevant parties the time to take necessary action,'' said Abraham, who added that he wanted the parties to ``act immediately'' to find a solution to the state's power crisis.
Black Blade: Soon it will be crunch time. Interruptible contracts are over for this year. The yearly allotment of interruptible power has been met only in the first 3 weeks of the year. Now the power crunch is more severe. Some off-line power plants will come back on line soon, however, if all were to be back on line, they only can provide enough additional power for a city of 300,000. The Grasshoppers are far from being outta the woods. Hear that freight train coming? It's called "recession!" and the one following behind is called "inflation!"
NY Precious Metals Review: Gold Near-Flat After BOE Auction
By Deborah Kinirons, BridgeNews
New York--Jan. 23--COMEX Feb gold settled down 30 cents at $267.0 per ounce, as excitement surrounding the Bank of England's gold sale appears to have faded immediately after the auction. The BOE sold 805,600 ounces of gold at $268.0 per ounce, and the auction was 4.8 times subscribed, one of the highest levels of demand seen since the start of the auction in 1999. "You can interpret it as mildly bullish because of the price and the coverage. But all in all, the BOE auctions are just a yawn," said Leonard Kaplan, president of Prospector Asset Management. The $268.0 price was 90c above the London AM gold fix. David Meger, senior metals analyst, Alaron Trading, said the auction was decent. Gold saw short-covering and reached its high of the day just prior to the gold auction, he said. After the auction, gold saw selling, but it was more a lack of any continuation of short covering than anything else, Meger said. Meger added that short-covering is still the key to this market.
One trader said longs partook in profit-taking Tuesday, and there was trade selling as well. He said the market still has potential for further short-covering. There are sell-stops below $263 basis Feb, and "the market may decide to reach down and take those out," the trader said. Kaplan noted that gold held support at $265.5 basis cash, "and it just kind of did nothing. It was extremely quiet on the floor," he said. He remains bullish on gold, and thinks gold will climb to roughly $273-275 in cash in the next two to three weeks.
NYMEX Mar palladium futures settled down $15.2, following news that Russia is making palladium supplies within the January amounts pledged in line with all long-term deals, and that Japanese buyers received confirmation from Russian export agency Almazyuvelirexport that the first shipment of palladium under long-term contract for 2001 will arrive in Japan before the weekend. Meger said palladium was lower on the news out of Russia, and that Apr platinum--which settled down $1.0 at $618.8 per ounce--followed suit. Meger says he still feels the market has a "show me the metal" attitude. They can talk all they want, but we actually have to see the deliveries, he said.
Black Blade: One take is that producers sold into the rally. That would most likelybe hedged miners covering their behinds by capping the POG. Likely culprits would include the likes of Barrick (ABX) and AngloGold (AU). They are rumored to be in talks to takeover unhedged Goldfields (GOLD), if true, that would be a tragedy as they would probably strip the assets and sell forward more gold. As far as the PGM news is concerned, no metal has landed on the tarmac, so be skeptical.
NEW YORK (Dow Jones News) - Crude oil futures fell at the New York Mercantile Exchange Tuesday led by plunging heating oil futures. Unleaded gasoline for March delivery, however, closed higher, finding support in January refinery maintenance and anticipated problems with California refineries due to soaring natural gas prices. Traders also bet that California's electricity crisis would curtail summertime production there.
American Petroleum Institute data released after markets closed on Tuesday showed a narrowing of the gap in U.S. reserves of distillate fuel, which includes heating oil and diesel fuel, when compared to year ago levels. March crude futures fell 23 cents to $29.57 per barrel, pressured by heating oil. The crude price had been trading even lower, but recovered in late afternoon trade following news reports that the Israeli-Palestinian peace talks had broken down again. In London, Brent crude from the North Sea was trading at $26.67, up 14 cents.
March heating oil fell 1.22 cent to 82.69 cents a gallon. March unleaded gasoline finished the day at 86.00 cents a gallon, up .2 cent.
Natural gas futures fell as traders looked to bearish weather forecasts. The March contract lost 51.1 cents to $6.946 per 1,000 cubic feet, down from a high of $9.20 in January.
Also pressuring the petroleum complex were indications of an apparent resumption of Iraqi exports since Sunday. Iraq halted exports Dec. 1 in an oil pricing dispute with the U.N. and its customers.
The API data showed U.S. inventories of crude declined by roughly 2 million barrels for the week ended Jan. 19 to 288.4 million barrels, compared with 291.6 million barrels a year ago.
Stockpiles of distillates, which include heating oil and diesel fuel, fell 826,000 barrels to 114.1 million barrels, below the 114.7 million barrels in inventory last year at this time.
Motor gasoline inventories moved higher, growing by more than 2 million barrels to 200.1 million barrels from 197.9 million barrels a week ago. During the same period last year, there were 198.8 million barrels of motor gas.
Black Blade: Crude inventory is down, however, distillates are up. The resumption of Iraqi oil exports will be the focus of OPEC discussions again. They indicated that if Iraqi oil were to flow, then they would counter with additional production cuts. The summer "driving season" could get a bit tight this year if the past is any indictor. Distillate inventories are still short of what is needed to avert the same problems as last year's inventory tightness.
- All analysts speak out in support of you and hype your shares (it's a multi-trillion dollar industry)
- a massive and influencial Venture Capital community is dedicated to supporting you and hyping your share prices
- All programming on one wildly popular tv station supports you and hypes your shares
- add to this the hundreds of stock-hyping web sites, radio shows, newsletters, etc.
- The ESF operates so as to support your share prices
- The PPT defends against any excessive or swift downdrafts in your share price (your own tax dollars support you)
- Many (all) gov't agencies manipulate economic data to support your share prices, home refinancings and excess credit expansion are encouraged by gov't and then accomodated by 'gov't sponsored' enterprises like Fannie May, thus increasing the amt. of money available for new players to support your share prices. In fact, the entire Federal government supports you and assists in the hyping of your share prices
- The Federal Reserve actively supports you - as the Fed Chairman himself literally sets interest rate policy for your benefit and slashes rates dramatically in a surprise move just as it looks like your share prices are about to take a final beating.
- Furthermore, the Fed floods the system with 'liquidity' (excess money/inflation) knowing that this inflation will bouy stock prices.
- Furthermore, if any leveraged speculators get in trouble (e.g. LTCM) the Fed will bail them out.
- Other wealthy gov'ts (G-7) actively collaborate with the US in supporting your share prices, though such action is often at the expense of weaker, poorer nations.
- The whole world supports you.
________
Invest in Gold:
- All analysts speak out against you and bash your shares and the underlying commodity (it's a multi-trillion dollar industry)
- a massive and influencial Cabal exists for the sole purpose of destroying you and bashing your share prices
- All programming on one wildly popular tv station attacks you and bashes your shares (or simply acts as though no such shares exist)
- add to this the hundreds of stock-hyping web sites, radio shows, newsletters, etc. - almost none of which ever mention gold, and whose slant is so anti-gold that they must be considered collaborators, albeit perhaps unwitting ones
- The ESF operates so as to crush your share prices
- The PPT defends against any excessive or swift uptrends in your share price (your own tax dollars attack you)
- Many gov't agencies manipulate economic data to undermine your share prices, home refinancings and excess credit expansion are encouraged by gov't and then accomodated by 'gov't sponsored' enterprises like Fannie May, thus increasing the amt. of money available for new players to neglect your share prices. In fact, the entire Federal government attacks you and assists in the bashing of your share prices
- The Federal Reserve actively fights against you - as the Fed Chairman literally sets interest rate policy for your detriment and slashes rates dramatically in a surprise move just as it looks like 'typical' share prices are about to take a final beating, thus obviating all consideration of risk and the need for prudence (safe harbor). The Fed *is* our safe harbor and gold is a barbarous relic (he says).
- Furthermore, the Fed floods the system with 'paper gold' knowing that this inflation in 'conterfeit currency' will suppress prices. In fact, the Fed most likely raids the national treasury, your own financial heritage, by which it gathers the ammunition with which to undermine you
- Furthermore, if any leveraged speculators get in trouble (e.g. LTCM) the Fed will bail them out.
- Other wealthy gov'ts (G-7) actively collaborate with the US in suppressing your share prices, though such action is always at the expense of weaker, poorer nations.
________
Despite this, I shall continue to invest in gold and gold mining equities.
As Asian Reforms Go Into Eclipse, Growth Outlook Darkens
Michael Richardson International Herald Tribune
Wednesday, January 24, 2001
SINGAPORE The signs are surfacing across Asia.
In South Korea, officials decide to bail out heavily indebted conglomerates. In Indonesia, the central bank announces that it will enforce aggressively what it says are existing curbs on the supply of rupiahs available to offshore institutions. In Malaysia, Prime Minister Mahathir bin Mohamad renews his call for Asia to reject "unfettered predatory capitalism and the absolutely free market" that he says are being imposed on the region by Western powers.
East Asian governments apparently are retreating from free-market principles and abandoning key reform efforts just as their export-oriented economies are slowing because of shrinking sales to the United States. The backsliding is expected to intensify as the U.S. economic downturn and the threat of continued high oil prices bring tougher times to many East Asian countries in coming months, making it more difficult for political leaders to make economically painful and unpopular decisions.
But the cost, economists and bankers warn, will be bigger debts and slower growth that will further undermine business and investment confidence, already sagging as a result of political instability in the region.
For the first time since the financial crisis of 1997 and 1998, East Asia faces a difficult external outlook. The United States, which absorbs more than 20 percent of the region's exports, is slowing more quickly than had been forecast just a few weeks ago, and orders for electronics, East Asia's leading export, are falling.
The regional monitoring unit of the Asian Development Bank warned recently that the slowing of the drive for reform in some countries, particularly Indonesia, the Philippines and Thailand, was a cause for serious concern.
"Implementation of reforms may be more difficult in a context of slower growth," the bank said, "but the costs of inaction are likely to increase in a less hospitable global environment."
It added that South Korea and Malaysia as well as Indonesia, the Philippines and Thailand were facing "the double whammy of increased external and domestic risks."
Other analysts said that China, widely considered to have played an important role in helping East Asia recover from the last crisis by sticking to its market-reform efforts and not devaluing its currency, was likely to be less resolute this year as slowing exports to the United States put a brake on growth.
David Roche, managing director of Independent Strategy, an investment advisory company in London, said many Asian countries had failed to reform the financial systems that were the root cause of the currency turmoil that started in Thailand in mid-1997. "Banks were bailed out, not reformed," he said.
Among the signs of backsliding that worry foreign bankers and investors are:
�South Korea's bailout of its chaebol, or big conglomerates.
�The newly elected Thai government's aversion to selling banks to foreign interests and its pledge to use $12 billion to buy bad debt from Thai banks.
�The unraveling of Malaysia's privatization program.
�The slowing of state enterprise and bank reform in China.
�Indonesia's curb on the free movement of capital.
The International Monetary Fund, which marshaled billions of dollars in emergency loans to help Thailand, Indonesia and South Korea recover from the 1997 crisis, has called on the region to intensify, not slacken, reform efforts. The Fund's managing director, Horst Koehler, said the IMF expected economic growth in Asia, excluding Japan, to slow to around 5 percent in 2001, from about 8 percent last year, as exports faltered.
"I would consider such a slowdown more as a normalization than a cause for doom and gloom, and justifying neither panic nor frantic actions," he said, noting that East Asian countries had cut their short-term debts, rebuilt their foreign-exchange reserves and were operating more flexible exchange-rate policies.
"The slowdown that causes me greater concern is that of progress in structural reforms in many Asian countries," Mr. Koehler said.
In South Korea, officials said action to rescue chaebol was just a temporary measure. The state-owned Korea Development Bank is to pay about 25 trillion won ($19.62 billion) of 65 trillion won in corporate debt that is maturing this year.
In Indonesia, the central bank's actions would make it more difficult for speculators to attack the rupiah, which fell about 25 percent against the dollar in the past year as the country's problems grew.
In the Philippines, the weeks of political turmoil that forced President Joseph Estrada to resign over the weekend sent stocks and the peso into a tailspin, diverting policymakers from the urgent task of improving tax collection and reining in the budget deficit. Former Vice President Gloria Macapagal Arroyo was sworn in as president Saturday, and Rafael Buenaventura, the Philippine central bank governor, predicted the peso would bounce back.
But Stephen Cheng, an analyst in the Hong Kong office of UBS Warburg Asia, said the sovereign rating of the Philippines was still likely to be downgraded, given the sharp deterioration in the country's creditworthiness in the past few months.
"Our view on the fundamentals remains the same," he said.
Analysts also said Malaysia's once-vaunted privatization policy was unraveling as sales of state assets slowed amid a government push to prop up troubled companies, many with political connections.
Here is the preliminary link to the year-long exhibition of 2001 "Odyssey" predictions which we promised you
http://www.usagold.com/hall/odyssey2001.htmlAs you can see, there is plenty of fine material there, and anyone wanting to try their hand at selecting the prize winners can offer their suggestions and justifications to me here at The Tower via Sitemaster@USAGOLD.com
And for your interim spectating pleasure, here is a look at the contestants' arrows as they speed their way toward Friday's target, the COMEX closing figure for the February gold contract....
AUgustUS (1/23/2001; 0:32:50MT - usagold.com msg#: 46198)
>>>========= $259.90 ==========>
IronHead (01/23/01; 23:55:51MT - usagold.com msg#: 46286)
>>>===FeRN's for AU on Friday: $Cheaper Than Paint On A Door===>>
(in the event of a tie, the earlier marksman shall claim the prize)
If it is apparent that your post has been overlooked, please notify me at The Tower. Be sure to knock loudly to overcome the din of many projects. (Alchemy can create quite a clamour I will have you know.)
I grow weary of the admonishment, follow the trend, the trend doesn't lie, the trend portends the future, BLAH, BLAH, BLAH!
Nothing is static. Everything moves, hence the term "trend". Are we to believe the trend for the POG is to continually decline in relationship to increasingly inflated fiat currencies? Are we to believe that cooperative efforts to suppress the POG internationally will continue indefinitely? JUST WHAT HISTORY IS THAT TREND BASED ON??? It is amazing that throughout this incredibly scant period of time (5 years) has seen the degree of cooperation to supress the POG as it has! THAT IS UNPRECEDENTED! IT ALSO CANNOT LAST!
Just what is this death knell trend for the POG supposed to signal to mankind? Will it change cross cultural economic attitudes globally? Are we to believe that one person from each country on this planet, if given the legal opportunity (please excuse this fantasy) to withdraw from the WORLD BANK vault (sorry, it was just too tempting!) an equal amount of their countries fiat currency or gold, which would the majority choose to leave with? Everyone knows that answer! GOLD! And the few idiots who didn't would fast try to trade, steal or fight for it!
There is only one trend that I will agree is apparently here to stay....that is of the spineless politician and all others wanting to exert influence over my life!
Black Blade, Gold up/down up/down...................
As I have said, this is standard procedure to keep the 'enemy' (we) guessing. There will lots of this as the transition moves forward. Transition there will be, have no doubt. But gold will be held until the Euro is 'firm' and at least dollar parity.
It makes sense. I mean if we were 'them' wouldn't we do the same. OK I know we are NOT them and have a different agenda.
But to beat the enemy, you have to think like them.
Trend does not mean just on the upside. Trend is direction.
Remember, you can make money on a down trend.
But I know what is frustrating you, the same as what is frustrating all of us, we want the trend in gold to change and become more obvious as it does so. (the trend in Gold has been down for some time, so it is food for the shorts.
However, like the tide when it is changing from flood to ebb, there appears to be a point where it is not going either way. If we didn't know it always went out again, we could be fooled into thinking it never would.
Patience, friend, patience - you are going to need lots of it.
Closures abound, and pinks slip are scattering like confetti. The man in the street ( and woman) will soon get the message. This is hardly the beginning
Er, no this is not in the mining industry - they have become used to hard times. AOL/Time warner, JC Penney's etc., etc.,
The latest BIS numbers indicate gold derivative positions of about 26.000 t/AU and it may be safe to assume
this means mostly a gold short position, due to the ongoing
carry trade. While the annual shortfall of supply vs. demand may not even be included in these horrendous numbers - remember the stated CB inventory totals 33.000 tons at max - looks like they're CB's are running dry of physical; Maybe they count virtual gold for real physical -
a parallel to the (virtual) Us budget surplus, which will bring tears to all, looking back from a few years in the future.
Well, as long as you can enjoy paying the paper price for physical enjoy - net importers of oil (or PGM's) for example already have tears in their eyes as they pay the bill of years of (not so, see P.R.of Kal.) begnign neglect.
As to the latest rumours of hedge (-fund) producers
trying to lay their d(erivatvely)irty hands on unhedged
gold may be another sign of the end game looming.
Buy some more as long as it's given away for paper.
Thank you - cb2
I felt there was perhaps a need to clarify some of the terminology used in our sphere of interest:
I could have added more but perhaps there are some of my fellow knights who have the wit to make a few additions:-
Soft Landing: You are given the hemlock in very small sips
Hard landing: They hold your nose and pour a litre down
Trend: The direction of a financial market, share, or commodity that is only identified when �they� have either got in, or got out � depending on the direction of the trend
Gold: A barbarous, relic, a commodity, �real� money, An Indian woman's dowry, Pirate treasure, a lump of non rusting metal���.(take your pick.)
"Buy some more as long as it's given away for paper." That sure strips away ALL pretense! Your "d(erivatively)irty" was a nice touch too! This forum is amazing!
Alright, on the record! How much patience? I do not consider the past 5 years as a test of my patience. However if we are are talking about another 20 years, I'm crying! How much longer do you think this unprecedented cooperation can last?
No doubt about,we're still in the trenches,battle may be intensifying,though.
Huge volume in the gold shares and not insignificant gains, prior to a percieved bearish event.Looks like we may be getting some new recruits.Also,the COT just seems to look better all the time.The next report is going to be interesting.How about the US dollar chart?Is this the right shoulder or does the uptrend continue?
(You will really have to do something about shortening that name, I feel I've done a posting by the time I've written it)
To address your question - it is closer than you think - if you are not looking for skyrocketing prices. I believe I covered it in my Odyssey
Anyway isn't our Knight Sir Thaigold going to tell us at the close of business to night. He made a promise, and that we could bet our shirt on it - or something like that.
My name is indeed rather long or more appropriately, inflated in letters. Please accept my sincerest apology for any discomfort to the digits received resulting from such name inflation. I will acknowledge and answer to SLATT, in a selfless concession to global harmony. Changing my name though, well, belies reality. You see my name and my country's currency are both fiat.
http://cbc.ca/cgi-bin/templates/view.cgi?/news/2001/01/24/placer010124 Sometimes people interested in buying gold are fed information that only encourages them to do so. But the facts are that gold has not been a profitable investment for quite a long time. However, it retains its reputation as a preserver of wealth in times of calamity.
Steve H. used to periodically summarize the predictions and reasoning behind the predictions of FOA/Another. He has not done that for quite a while and seems to post here much less frequently (many of the old posters do not post here much anymore).
Correct what I inaccurately list. And please help by filling in the time frames FOA?Another predict for these events. I know that in the latest Trail Guide postings, something is supposed to happen this year. FOA is starting to write much more clearly (dropping his effort to maintain the mysterious angle that Another insisted on, and for which he was severely berated on other Internet gold forums), and that helps a lot.
In the FOA/Another scenario, we await the following:
* destruction of the LBMA and COMEX price-setting mechanisms
* hyperinflation of the US dollar
* establishment of a new authoritive price-setting mechanism for gold. This "market" would be supported by the BIS.
* a US dollar price for gold in the many thousands
Is this the FOA/Another story? If not, do we wish to get it straight?
Bad news from the link above:
Gold stocks moved lower on the TSE Wednesday
after one of Canada's biggest gold miners,
Placer Dome, said it foresaw virtually
no chance of any significant rise in the
precious metal's price.
Placer Dome said it would reduce the
value of its gold reserves on its books
from $325 US an ounce to $300 US an
ounce. Even that figure is $34 US an
ounce higher than the current spot
price.
President George W. Bush unveiled his education plan yesterday. It includes annual testing of students
and the school-voucher option.
Predictably, as soon as he presented the plan, the teachers' unions started to whine. The National
Education Association said the proposal was "sure to divide us...The plan unveiled today relies on a
failed political gimmick." The executive director of the National Association of Secondary School
Principals called the voucher proposal a "silver bullet" solution.
Should we be surprised? Of course not. Teachers' unions aren't interested in giving students the best
possible education. They're interested in protecting jobs and getting bigger salaries for union members,
including those who deserve to be fired. And many teachers are absolutely opposed to any measure of
teaching performance, because that would expose their shortcomings.
Bush's education plan would allow parents to pull their kids out of failing schools. That would mean
fewer students in government schools, and eventually some of those government schools might have to
close, putting union teachers out of work.
Yet again we see that the teachers' unions are only interested in toeing the Democratic Party line and
barring the schoolhouse doors to keep students from escaping their grasp.
This is an important test for Bush and his new administration. Will he press for school reform, or will he
knuckle under as the Republicans have done so many times? I'm not holding my breath.
Speaking of government schools, for Saturday's special edition of "Good Morning America," ABC sent
cameras went into third- and fourth-grade classrooms to see what advice the kids had for our new
president. The responses that made it to air:
� "Get rid of guns."
� "Give" more federal money to schools.
� Tell companies to "stop cutting down the trees."
� Give the homeless "a second chance to go to college and get a diploma."
� "Just be nice to the Democrats" and "treat them like they're your friends."
Charles Gibson wrapped up the segment by recommending that the voting age be lowered to include
third- and fourth-graders! He said those kids were "pretty well clued in."
Yes, they are, aren't they, Chuck? They're perfectly clued in to the social engineering your Democratic
Party wants to achieve. They're the perfect little liberals of a future America � an America where no one
has the right to self-defense, no parents have the right to take their child out of government schools, and
environmentalists rule the roost. It's an America where everyone has a right to an education, and the
Democrats are your friends.
May heaven help us when these brainwashed little liberals grow up to be our journalists and elected
officials.
Where's This Budget Surplus?
Would some economics expert please �splain this to me?
I'm talking about this budget surplus we're supposed to have in this country. Frankly, I don't think it's
there.
The first year we were supposed to have a surplus was 1999. OK, fine. So we had a surplus in 1999.
Then tell me why our federal debt increased by $127 billion dollars in 1999?
Ditto for the year 2000. The surplus has been cited as about $87 billion. What about our national debt?
It went up by $23 billion. The estimates are similar for 2001 when the so-called surplus will be $68
billion, but the debt is supposed to increase by $82 billion.
I'll tell you how it is happening, folks. Every year our government is borrowing money to add to the
budget. This then puts the budget in a "surplus" category. But the debt goes up too!
Consider your household budget. Let's say you earn $80,000 in 2001. Bad news, though, your bills total
$90,000. So you borrow $20,000 from the bank to add to the $80,000 you earned. You pay your
$90,000 in bills and expenses and you have $10,000 left over! Are you going to kid yourself by saying
"Look, I took in $10,000 more than I needed this year! I have a surplus!"
Well, that's exactly what the politicians are doing, and America is falling for it hook, line and stinker.
Gotta Go to Work
My job just got harder. I don't have a corrupt president and even more corrupt first lady doing my show
prep for me every single morning any more.
Oh, sure. There will be news and events that command the attention of a talk radio audience. Hillary,
after all, is in the Senate, Bill is in control of the Democratic Party, and the push to get a Clinton back
into the White House is on.
We'll have the leftists trying to move more and more of the middle and lower income Americans off the
tax rolls, while shifting the burden further onto the backs of a minority of high-income Americans.
Democrats will be working to gain the control of the Congress again. Some ancient and sickly
Republican Senators will leave and be replaced by Democrats, shifting the power.
The eco-commie radicals will continue to try to destroy America's industrial base while socialists
continue to work for redistribution of the wealth. Every day more and more Americans will wake up to
the realization that they are being royally screwed by Social Security, our insanely high tax rates, or both.
Government will continue to grow, individual liberties will continue to shrink, and the American people
will continue to not give a damn.
Still, right now, I must say that I miss Bill Clinton. Having a corrupt, dishonest, womanizing,
sociopathic, socialist, enigmatic, charming rogue in the White House hasn't been all that bad for talk
radio.
Now integrity is back, and I'm going to have to start earning my living.
Neal Boortz is the hugely popular nationally syndicated radio host.
Careful reinspection inspired by pointing fingers from the gathering at hand reveals that my original tally overlooked a timely entry. It is with pleasure and satisfaction that I now see this early evidence of my friend's participation by the light of day:
We come, most of us, to our gold interest in a time of stock mania, when the myth of easy gains drives our neighbors, friends, and families into a greedy anxiety about "missing out."
The reality is that the typical stock peaked in April 1998, and has been in decline since (Advance/Decline line). Only the mathematical weightings of a few giants have kept the indexes churning near previous highs. Churning, as in DISTRIBUTION to those little suckers coming along to buy the mania with their life savings or on their credit histories.
We all catch some of that fever, as we all want our investments to "go up". "It's OUR turn now."
But I would put it to you that, with statistical significance, NO major category of investment has gone up in the past three years but real estate, and those are gains most of us can cash in only by selling our homes at the peak.
Gold has been as profitable a holding as any (flat), and has "paid an insurance dividend" the entire time, especially after the late-1998 derivatives breakdown first warning. Better three years early than a day too late.
I heard on the news this morning that produce prices are set to rise as a result of the California power outages. It's funny, when I starting posting about the return of inflation in these pages two years ago, I had no idea where it would crop up first. I also didn't know the order in which prices for various commodities would begin to rise. All I knew was that the Fed had begun to create money at a reckless pace and that higher prices would inevitably result.
It has been an education watching things unfold. Excess money creation overheated the economy. The overheated economy put a strain on energy resources. And now, strained energy resources are threatening even the price of broccoli. Soon, higher broccoli prices, along with higher prices for a whole lot of other things, will no doubt pressure workers to demand higher wages as an offset to their loss of purchasing power.
By now, the Fed has had its chance to reverse this looming monster. It could have curtailed the growth of money, stopping reinflation dead in its tracks. But the incredible burst of money creation over the past two months is clear evidence they have chosen not to. The price in terms of unemployment and spreading corporate and personal bankruptcies was evidently considered too much to bear.
The real insanity behind all of this, of course, is the manner in which so many on Wall Street, a majority, in fact, refuse to connect the inflation dots. Like a new bull market, it seems, low inflation has a thousand paramours. Yet, like a new bear market, the recent return of inflation has been met all around with scorn and disbelief. Each day, the media report to us on the burgeoning cost of energy. Only last week, we were told that the year 2000 CPI scored its biggest increase in a decade. Yet the same news sources just as regularly remind us there is no inflation in the United States, today.
How long can this insanity go on? I obviously do not know. I made my bets on inflation two years ago. At the time, the dollar was under threat not of INflation, but of DEflation. But the seeds of change were in the wind.
Two years on, those seeds have sprouted all around. If only people would connect the dots.
Sometimes I just mull this over at odd moments (driving, shower, boring meeting) trying to get the hyrdraulic pieces of this puzzle put together -- "what pushes on what, and makes what else go where?"
If we take the various components of FOA's forecasts as contributing to the "new market price", it now constellates in my mind as looking like a three-stage rocket. (Possibly more stages, and intertwining effects, but for now try this:)
(Stage 1) LBMA/Comex breakdown (how? -- what signs show up first?) gives first stage (to 600? 1000? sounds like FOA thinks more) as physical becomes the only game in town to absorb gold buyers' interest.
(Stage 2) Foreign US dollar cashing in, both by CBs and investors holding cash balances, stock and treasuries, buying physical as still underweighted -- where else to dump dollars quickly? A bit of sellers' panic among those not dollar-indoctrinated from birth, like USAmericans. This maybe doubles-triples (2000-3000?) the prices from Stage 1.
(Stage 3) US hyperinflation in all goods reflects dollar over-"printing" and cashing out of all markets: stocks, debt, and real estate. US buyers' panic takes gold over several years to a sellable excess value. (Ahhhh -- the "retirement years".)
Stages 1 & 2 "catch us up suddenly with previous wealth value" (paraphrasing FOA) and Stage 3 is protection from the hyperinflation in Stagflationary times. In other words, 1 & 2 are relative increases in our investments' purchasing power, and #3 holds it while most others be losing theirs.
Have I got the scenario close?
Sequences might be different, or intermixed.
Numbers might be applied to each, both in volumes of dollars sloshing around and proportions moving into gold (Oro? famous for wonderful extrapolations, maybe someday this exercise will present itself to you). (Gold prices are more meaningfully observed as proportional moves from stage to stage, than arithmetic moves.)
And mechanisms, such as LBMA/Comex "seizing up" and Fed attempts at monetizing debt instruments might be explored to give us some inflection points or launch points for each stage.
This is my attempt to visualize FOA's scenario, since it represents such a strange wrenching out of current financial "wisdom". A 10x move is explainable; a 100x move needs more support, and pieces to fit the puzzle. An understanding of mechanisms and a cash flow model for this to happen, are what I need to work on next.
Mr Gresham, I absolutely agree with you regarding the insurance rationale for buying gold, it alone has allowed me to sleep soundly for the past few years, especially while my contemporaries are sweating bullets and trading their Nasdaq and DJIA paper with increasing urgency until they have to pull out of the market due to insolvency. They have never seriously looked at gold! And until the herd runs to gold they never will consider it! Indeed, they deride the very concept of owning gold! I now listen with an attitude of concern, I feel their pain! I'm also tired of being the object of their amusement by my belief in a true gold standard.
My experience overall with real estate in the US in the last two years is that actual sale prices are generally weaker, and housing starts are currently plummeting. I would be very cautious in real estate, that tide is going out, not coming in.
The Stranger: Don't look for any help from the Bush administration in checking the effect of inflation on the price of broccoli. Like his father, with his cabinet, GW.....HATES BROCCOLI!!!!
Odysseus (Gold) returns to Ithaca and, disguising himself as a beggar (demonetized), heads for his palace. Upon his return after 20 year, only his dog, Argos (the mostly hedged mining industry), recognizes him, and the dog dies after waiting 20 years to see his master again.
You're forgetting about the ongoing negotiations for the Euro to settle (perhaps in a basket) oil internationally. That is the catalyst. That is the key.
Now this may not appear of much interest, or significance at first glance, but if you spend a little time and thought to reflect you may conclude differently.
We are being led to believe, by media, and pundits, that gold is dead. The mining industry has taken everything that could be thrown at it, and then some. This has also gone on for a very long time. It is hard to imagine a worse case scenario for any industry for, at least, a decade.
Yet there is resilience, and measures have been taken to keep going because there has been belief that, one day, things will turn around. The history of gold is too long, Gold has stood the test of time. Gold is unique, and there is a certain finite quality to supply.
This adversity the industry has faced has caused them to take measures that will eventually benefit them (these benefits are already being felt). They are becoming leaner, and meaner. They are expanding, in particular, by amalgamation, and takeovers. The strong are absorbing the weak.
Once they arrive at an economical cost of production. The rest is profit, and this can rise dramatically once the gold price increases.
Investors know that by tradition and nature of the industry, mines return a large percentage of the profits as dividends - which is really what true investing is all about.
So, here we are, one of the largest North American mines that has just taken over a once leading mine, Battle Mountain, that had been hit hard, an in spite of the gold's supposed weak prospects ( and price) is able to start paying dividends,
And if the above alone doesn't convince you, think about this 'THEY'fear it! You don't fear something that is a mere commodity
Therefore, I say, take heart. Our day will come.
Attention Business Editor:
Newmont Mining Declares Regular Quarterly Dividends
DENVER, Jan. 24 /CNW/ -- The Board of Directors of Newmont Mining
Corporation (NYSE: NEM) today declared regular quarterly dividends of:
-- $0.03 per share on its common stock, payable March 21, 2001 to holders
of record at the close of business on March 6, 2001.
-- $0.8125 per share on its convertible preferred stock, payable
February 15, 2001 to holders of record at the close of business on
February 5, 2001.
Newmont Mining is one of the world's largest gold producers.
My most effervescent thnaks Sir Gandalf for the vial of free gold I received from your alchemical laboratory. I keep it in an honored place in full view to remind me that miracles are always possible. Once again I thankyou!!
In Homer's telling of that ancient tale, Odysseus and his companions took great risks to travel to new places, teaching us the value of heroic journeys.
When we are born it is that we are willing to risk a journey into an unknown world, because the womb-world we are in is becoming suffocatingly small, a certain death if we stay there much longer.
Something similar there is in the soul of gold, that wishes to travel from deep in the earth, to the surface world.
Those old citizens of other countries, other times, knew they could die of deprivation, of war, of bad weather, unless they had small store of gold to insure their survival. Every day their lives, they knew, were at risk to stay where they were, which risk they could reduce by saving a little gold whenever possible.
Now we know that as humans we are impelled by our inner daemons always to strive to escape the confines of whatever our present "womb", whatever that is, and seek a greener, more expansive place. We are impelled to take risks to get to a new place. Yet we are simultaneously driven to keep ourselves safe, to avoid uncertainty and the prospect of loss. How we resolve these twin tensions of life, determines our fate and our story.
Recently, I had a dream. >>>Some gold coins had melted into a puddle, a lump of unshaped gold.<<< What I get from this, is that the odyssey of gold is to be seized from the earth by mankind, to be shaped into whatever talisman of wealth we conceive, fine art, or coins decorated by emperors' faces. Yet even this ultimate in indestructible matter is subject to the whims of fate, its final shape beyond my control.
Ultimately, in owning gold, I own no more than in owning my own life. From deep in the earth, I came to this place for a brief time, to pass on only my spirit to the future. So it is in the odyssey of gold, not its shape or its value, only its spirit indestructible as the metal, travels into the future. As in owning gold, a person who owns their own soul, risks nothing, and may gain much.
On your msg. Usagold 46210 I was delighted with your retelling of the Odyssey as the saga of Gold and I have a question about your preamble re the markets.
It seems you think there is no or little risk in owning US $ paper securities, unless they are gold derivatives. What about the pronouncements of FOA and ORO and Noland, et al on the huge debt, asset, and derivative bubbles threatening today's dollar to the point it may well be extinguished in purchasing power?
My friends and neighbours certainly don't entertain any apocalyptic visions such as this. They seem to fall more in line with your thinking. But, I see that they are all stretched to the maximum with debt and consumption addictions, big mortgages, and savings if any only in mutual funds, no cash or gold. Do you think ORO's and Noland's analyses of our economic situation are incorrect? Do you believe we are going to coast on into the future, with little or no economic upheaval? If so, how are the debts of years of the 10% per year increases in the M3, going to be mopped up by a trade deficit economy whose GNP can't possibly grow by more that 2-4% per year?
I ask in the spirit of earnest enquiry, wondering on what you base your apparent optimism?
Or in my case watching the movie.....Kirk Douglas (gold) reveals the truth and thus hope to his son (a disgruntled investor). Both take up arms to confront the The Suitors (the global conspiracy against gold). After a bloody battle (fiat fraud exposed) in which "The Suitors" were vanquished (central banks eliminated) and Kirk Douglas and son restore honor and legitimacy to the kingdom (the return to the gold standard). The long suffering Queen (taxpayers) vows to never let Kirk Douglas (gold) leave again!
Sir Peter my apologies I think I may have misattributed the fine story of the odyssey as the saga of gold to Sir ET instead of yourself. Maybe the rest of my messsage to him, (msg. 46324 just precedes this one) should also have been directed to you?
The U.S. "Budget Surplus"....some thoughts for your consideration.
Last few years we've been receiving our brainwashing about the great U.S. Budget Surplus and how the National Debt was going to be paid down in a few years. Totally amazing prospect of unending prosperity!
First of all, with regard to that mythical surplus, we have to take into account that a considerable part of the tax-money coming into the Treasury, was produced by Capital Gains taxes on rising values of stocks. As is now evident, taxes from that source are going to be sharply down next April 15th. Stocks are not rising, nor do we - at this Forum especially - expect them to rise substantially, if at all, for quite some time.
Incidentally, these Capital Gains were produced by: Inflation. There has been, and continues to be, a tremendous inflation, caused by Credit Expansion. Not only an increase in money in circulation causes a general rise in prices. A general rise in prices can be caused by a Credit Expansion, which the U.S. has had in spades. Read: prudentbear.com, about the Credit Expansion. And Von Mises, about the effects of credit expansion not based on savings.
As good old Vern Myers used to point out in his excellent newsletter twenty years ago, Credit Expansion is like a forming cloud, which grows and grows. Eventually, it cannot grow any further. Precipitation begins. Rain begins to fall. That rain can be likened to either the default of debtors, in which case the creditors (buyers of bonds, etc) lose out and they pay the debt with their loss; or else, the cloud comes down in the form of: hyperinflation caused by the desperate attempt to liquefy debt with mass monetization, i.e., cash is manufactured and delivered for debt instruments in an attempt to stave off default. But that cash is deadly, in that it immediately becomes demand for goods: runaway prices of things. In this case too, the creditors lose out big, as their money shrinks drastically in purchasing power. The debt is paid by the creditors. In both cases, the debtors cannot pay the debt, since they are bankrupt. To some extent, to the extent of their capital investment, the debtors of course, also pay part of the debt, but they cannot, by any means, cover all of it to make their creditors whole.
But to return to the theme of Budget Surplus.
So part of the Budget Surplus was the result of a monstrous Credit Expansion, which produced a rather painless tax revenue from Capital Gains, paid willingly by people who thought it right to pay a tax on part of their very substantial "profits" in the Stock Market. That is now gone, and its return is very, very doubtful.
Another part of the tax revenue has been coming from Social Security taxes. Instead of attributing the moneys coming in for Social Security to a Social Security Fund, the U.S. Gov't has mixed this tax revenue with general tax revenue, and simply creates bonds which are passed on to the S.S. Fund. (Did you see the movie "Dumb and Dumber"? "It's all there, every last penny, yes Sir!")
This is why the Federal Debt continues to grow - these S.S. Fund bonds are issued, and form part of the "Non-marketable U.S. Debt".
So these Funds, we might say filched from Social Security, are counted as Tax Revenue and contribute to reducing the Deficit and producing that mythical "Surplus". But at the same time, the Federal Debt grows by that filched amount.
But there is still another source of Government Spending, very important, which is not, however, included under Federal Spending. This hidden government spending is paid for by BORROWING MASSIVELY. Where you say? The Federal Debt is not going up that much?
That Government Spending is being carried out without causing much concern, through the absolutely enormous increases in Borrowing and Spending by: the Federally Guaranteed Government Sponsored Enterprises, the GSEs like Freddy Mac, Ginnie Mae and other silly-sounding gigantic financial organization which have taken over a very substantial part of the mortgage market in the U.S., due to their real (or perceived) Government Guarantee, which makes their debt a proxy for Government Bonds. See: Prudentbear.com for the horrible facts.
The GSEs are monetizing their debt, by placing it in "Money Market Funds". These Funds accept the "paper" or debt of the GSEs without question, as Federally guaranteed, and credit the GSEs for their I.O.U.s with credit balances at their Money Market accounts. Thus enormous increases in Money Market funds which people suppose are Dollars. These "Money Market Funds" are not really Dollars, from the banking system. They are confused with those Dollars, but really another "money" which people accpet unquestioningly. Who wouldn't like to have a few million in a "Money Market Account"? You buy a house for a couple of million, what's the seller going to do with a couple of million? He's going to put it in his Money Market Account, just where you got the money to pay him.
Once you are dealing with big enough figures, when you spend a "Money Market Account" balance, it is most likely that the amount you "spend" will simply find its way to another "Money Market Account". And so the game goes on. I leave it to another, to describe what happens when Money Market Fund assets begin to go sour because debtors - issuers of commercial paper - cannot make good. Or when the rise in interest rates destroys the capital of the GSEs, and the insurers or investors in interest rate derivatives, meant to protect the GSE borrowings, go belly up, or the U.S. Government has to BAIL OUT THE GSEs. That will be a show!
If you add up the Federal Debt, with the debt of the GSEs, and add up on the other side, Tax Income and the Income of the combined GSEs, you will have a sum - which I have not calculated - which will surely knock your socks off.
THAT is the real fiscal situation: no Budget Surplus, rather, a totaly outlandish Budget Deficit, financed with massive government borrowing via the GSEs, which are off-budget.
Now, these GSEs are into mortgages, long-term loans by definition. When you see the yield on the 30-year Treasury Bond begin to grow, you will know that the present value of the mortgages is decreasing - according what is known as the "Bond Equation": an increase in yield on a bond means a reduction in its present value.
The GSEs have been working with razor thin margins and lending to ever less credit-worthy mortgagees. When the GSE assets shrink, they will destroy all their capital and we will have a situation incomparably worse, disastrously worse that the situation with the S&Ls.
The Fed can contain, to a certain extent, short-term rates, but it can do absolutely nothing about long-term rates, the rates that are going to kill the GSEs.
Sit back, relax, and enjoy the show! It is going to be historic.
"If this be error, and upon me proved,
I never wrote, nor is my name
For 2 years and running gold believers and promoters
analysts on gold sites have all been wrong claiming
to know the direction of gold. Now and then you have
new posters claiming to know gold is going up soon.
Thaigold is a good example not just on this site but
others posting under different handles as well. Up
until now everyone of them have been dead wrong.
GATA can also be included and have done nothing
to help the price of gold. My point is for anyone listening
to these analysts are commiting financial suicide. Like
others I have put too many golden eggs in my basket
and becoming a poor popper over the years. Living
costs keep increasing and I'm falling way behind in a
substantial way. You would think a rally would develop
in a meaningful way because everyone in the investment
world is so negitive on the metal and 20 year lows if not
500 year lows adjusting for inflation. This is really a nightmare for anyone who has invested in gold related
assets in a meaningful way. You can go back 5 years/
10 years/15 years/ and all of these investors are out
of luck in a big way. If you were to choose any investment
this ranks way below the worst of the worst. Call it extreme
bad luck or is someone up there don't like us. To be honest
it looks bad going forward for gold. The fact remains gold is NOT a hedge and is not anything but a losing investment.
As insurance it's good, but very little is the best bet. Like
one analyst says "gold needs to prove itself and stay above
$325 for 3 months or more. Otherwise the odds are stacked
againest you. It's not in public interest for gold to rally. No
one wants to lose their job and no one is going to defend gold. I have been a goldbug but looks like I need to look
at it from a completely different angle. I read parts of the
book "THE POWER OF GOLD" by Peter Bernstein and
in the very last chapter he states gold has worked directly
againest those who have invested in it in a big way. Most
of not all through out history gained only misery from being
heavily invested in the metal. This was Peters finally feeling
on gold that it brought it's owners no happiness in the end.
This is exactly how I feel. Yes, buy gold but only a small percentage of your wealth. Anything else is a perscription
disaster and misery. Play at your own risk and remember
the facts. Not many slip through and make money on gold.
You can find many millionaires and not one is going to tell
you they got rich in gold. Goldbugs need to find other
interests and wiegh out your decisions before buying more gold. Sorry, but the facts are not false but true. I have
a hard time with it myself but I need to try harder to seek
out other opportunities besides gold. Wish you all luck
and hope you can find great opportunities in the future.
Don't get me wrong I still like gold because it's been overlooked, but how long will it be before they decide to
let the price rise. Could be a very long time and will it
be nuclear war before it responds. I don't know but it
sure looks terrible for gold unless we have a world
disaster that will affect life as we know it. Then us goldbugs
will never be able to enjoy it. So, before you take the
plunge remember gold has no friends. Just look at the
facts and read the Power of Gold because it sure opened
my eyes.
For example I live in California and went to Millers Outpost
a clothing retailer and could not believe the bargains in
apparel. $3.00 for a name brand sport shirt and this
was not a t-shirt but a nice heavy material shirt. This is
only one example of many where prices are way down.
Another example is Reebok mens leather tennis shoes for
$21.00. I have never seen things so cheap. I could go on
and on. Lets face it I think people hear are not reporting
all the facts. The bargains are everywhere. Energy
is another issue and I think this could be a catalyst for gold
but not with bargains like I see abound. It's no wonder
gold can't rally. Those sitting behind computers all day
just don't know the real world and making bold predictions
about gold. It's a big world out there and if you can still find
bargains like what I'm seeing don't expect too much from gold. Your bullish arguments are flawed. People will turn to
gold when money can't buy anything anymore. Not
to say it can't happen but things are not looking up for gold.
It's a hard sell with bargains everywhere. Just reporting the
facts.
Nooooooo!!!!!!! Re- >>>>It seems you think there is no or little risk in owning US $ paper securities,<<<<
*I* don't think that. I consider THEY do!
When I said "the markets have spent twenty-one months now above and below a flat-line median. The Dow, for instance, has a line right through the 10,600 level, and at the moment swings a bit above and below in an orderly fashion. Consider how much stock is now in the hands of recent owners who are more or less even." I was looking at the 401-K et-al group as being in a locked in mentality by being coaxed into continuous investment over the past twenty one months. The volume over that period has been up 50% yet the chart pattern is an elongated horizontal diamond. This is the world of investors out there who don't cut their losses and so stay in for the "long haul." I'm suggesting that AG and the PPT have so managed to keep the herd well off from the thunder and lightening and have averted the stampede. (So far)
These folks put �everything' into the market. We collected an $850.00 retainer Saturday and they asked us to hold the check until they could sell some mutual fund shares to cover it.
To INVEST in gold might well be folly. And those that feel that gold will increase their wealth are probably feeling the same 'enchanment' as those who still invest in internet companies. The seductive desire to get great wealth with out work, it pulls at my mind also sometimes.
But gold is not about investment, perhaps even paper gold would be better for investing or gambling.
I buy gold to save what wealth I have. I work, at a job, a crummy job at that, to increase my wealth.
I shall never be rich, my job dosn't pay very much. But I will likely never be destitute either. I save. My employer pays me more than my living expenses. And the surplus I save. Someone of my skill and background is probably worth about one ounce of silver a month, as a historical average. But I can get much much more than that now, at least for a while. So I do. I keep what currency I expect to need as a cushion against surprise expenses. The rest I use to buy gold and silver.
I don't ever expect to sell my gold for a profit. Never!
I hope never to sell it at all but give it to my sons. It is SAVINGS, and I am driven to it by FEAR that the numbers in my passbook savings account though large enough now, might through no action on my part be not large enough later. I fear currency devaluation.
I owe nothing, I have no debts. I expect no great increase from anything other than my own labor. And I save in the currency of my country (and the world, for now) and silver, and yes, I save in gold.
And I am content.
Best Regards
While your post if very sobering, if only because we see another believer joining the ranks of the non -believers.
Your message is only an echo of what we have had to endure for quite too long. I can understand how you feel, and a lot of what is said I can accept.
The part that really worries me is that I feel that 'the world' disaster, that you feel would be needed for gold to glitter is a very high possibility.
I posted something yesterday under 'My old Gran'in which I tried to temper the very serious message, and my reasons for
believeing in the high possibility (probability).
Of course, this is not what we, or anyone wants.
However, failing any huge world economic distaster - though each day we approach the circumstances that increase the possibility, I still feel that gold, as a mere commodity, has been oversold for political reasons, and will recover sufficiently to make quality mining shares, at current prices, a good investment.
Attn: REVELATION (01/24/01; 15:16:19MT - usagold.com msg#: 46329)Attn: REVELATION (01/24/01; 15:16:19MT - usagold.com msg#: 46329)
In your post (above reference) you wrote:
[quote]
For 2 years and running gold believers and promoters
analysts on gold sites have all been wrong claiming
to know the direction of gold. Now and then you have
new posters claiming to know gold is going up soon.
Thaigold is a good example not just on this site but
others posting under different handles as well
[unquote]
Your mention of my (only) handle caught my eye. And bye the
way, I'm not a "new poster". Just an overlooked poster.
Perhaps you somehow miswrote (or I'm mis interpreting what
you wrote) that I have been forcasting POG to go up. Myself
do not feel that has been the case (recently). But I may be
wrong. What (posts of mine) do you feel justifies saying that.?.
I feel most in this forum would liken me to a contrarian at best,
and not necessarily incesantly predicting imminent upward
movement of the POG. POS maybe, for sure, but not POG.
If POS jumps dramatically then it could/would surely pull POS
upwards with it. But that's not been my primary focus.
Silverf has far different fundamentals going for it than Gold. It
(POS) should not be overlooked as one of the best investment
possibilities of our lifetime, at its current savaged price. So, I
urge you to take another look. Dig deeper. Lest you be left
behind.
The Euro. Yes, I forgot the Euro. My first thought on that is that I don't know what to do with the Euro. I was impressed when we saw that it had taken up 40-something % of new debt issuance in its first year. And of course, it's recent price recovery makes big psychological lift against the dollar propaganda machine.
As a variable in our (non-existent) equations, it could work both ways: It creates doubt about, and an alternative to, the dollar. But it also requires the international fiat world to hold back gold so Euro has a chance to insert itself as far as possible into dollar's role.
Euro has always been the "I don't have to outrun the bear; I just have to outrun you" story. So Euro stands aside during my "Stage 1 and Stage 2" meltdowns (are there any Comex/LBMA type markets in Euros? or just private OTC contracts?). And at least holds its own with dollars during a US hyperinflation as costs of oil and basic resources move through the GDP.
Oro has given us some basic reasons to doubt Europe's ability to fully exploit dollar's downfall, but again "outrunning" the dollar might not take much...
International currency dealings are something we are all pretty novice at, especially a new currency, but we're learning along with a lot of pros, and ahead of 99.9% of the public (lotta good that'll do us at the grocery store, huh?)
So you are here. Did I not understand you were to disclose the direction of gold - or when it will move, at the close of business today. I am waiting, waiting, waiting
Though don't tell me if it will give me a sleepless night.
PS: In my Contest Prediction, I guessed "$275.00" POG.
In the context of what you wrote, and what I just wrote, let
me say that I don't consider $275 as "UP". No Sir. I consider
that as Languishing, within it's currently manipluated "range".
Just a mild upwards tick, probably short-lived.
But I'm still looking to find more of my errant examples.
=============================================
To ALL: (Especially you, Pandagold):
My much (?) awaited "The POG Answer" post, promised for
today, is indeed forthcoming, on the press, ink drying as I now
write. Had I not been distracted by REVELATION, it would
have been posted by now. (and no, I'm not ReWriting any of it)
By Mr. Notely, one the most respected in his trade - and probable, not for the AU-purists-, though still interesting has recommended a portfolio og gold stocks in Nov. 00 and has the following to say: Snip -sans technicals:
" Gold stocks are moribund, forlorn, forgotten and dismissed from portfolio management consideration. Gold stock indices are more oversold than at any time in their 60 yr. history.
A very strong accumulation condition has developed in the Precious Metals Markets.
A once in a lifetime opportunity is quietly and subtly (I would add stealthly) unfolding. We are now witnessing early relative outperformance (well, not in the last 2 days, so what). We have a bottom juncture signal that is bringing together of all trend structures - Secular, long term, intermediate and short term Trend. It is the most powerful signal for stock/price accumulation in our market discipline. The last time this signal occurred for the general market was August 1982-DJI 770!" - unsnip
.... And at the last time the media titled, "Death of Equity Investment!" ... Today, almost a generation later investment in the barbaric metal, gold is obsolete ... You've got to love it... Seriously, I hope you do, too - cb2
PS: Hello Stranger - long time no talk - great post, though please refer to other produce - broccoli - overheated or not, excessively created (or even gratinated)alternate greens may get me back to "Vogerlsalat" -is not my particular favorite green vegetable, or is that why you've mentioned it... cheers, anyway and hope you'll be watching the Arlberg (StAnton event) to get a feeling of the Austrian avalanche coming to your neighborhood soon.
PPS: SLATT - welcome to any plagiarism as it may be already secondhand - though really - welcome again.
PPPS: Pandagold, didn't you mention you've been a teacher? ... and you've been complaining about slow posting, well Sir, please try to translate a comment one of Austria's (yes, we have a life outside of A'Our-Economists) Novelists couldn't help to state at a teachers convention in the old Hofburg (Emperors Palace in Vienna):
Ich habe den Saal schon voller gesehen,
ich habe ihn auch schon leerer gesehen,
aber so voller Lehrer,
habe ich ihn noch nie gesehen!"
Not intended to discourage you in any way, only Sir Panda (-Chinese Panda coins have done great for me since inception, bullion cum numismatic) as lectures have their place and so have discussions.
PPPPS: Randy - we'll have to build a tower - high enough to give credit to your achievements - thank you and hopefully MK has elevated you to the order of the golden fleece - or
I(j)ason of the Argonauts - the parallel Saga of Ilias and oddyssey.
And I know gold looks cheap but I'm afraid it might
go cheaper. I guess I'm being difficult but I only
report the facts. My point is when I see the bargains
and fire sales out there, I can't see any potential with
gold. Not to say it can't rally some, but it just can't go
too far unless we have a real world disaster. The dollar
is the key and that could come like a thief in the nite.
Like Germany 1923 they said there was no warning
when hyperinflation took center stage. No one knew
it was possible, so anything can happen. But I would
like better arguments and evidence from posters as
to the case of being long. Seems like we as gold investors
have been cursed. Just facts, nothing more or less.
http://www.scales-and-weights.com/scales/html/asian/opium10.htm=====================================================================================
All:
Yesterday I posted that on today, after the close of markets, I would post a short
Answer to everyone's persistant Question: "When will the POG go UP.?."
Now, herein, is that promised post. The Answer for you. Some may be disappointed.
For it is not a date-certain. For that is not possible. Indeed, even foolish to try.
All I will tell you; show you; is what *exactly* to watch as a definitive indicator
and the precise predictor of POG movement. Up or Down. Or SideWays. Now, your Answer:
=====================================================================================
The POG (Price of Gold) will begin going UP, when The PFO begin going down.
=====================================================================================
PFO has Three Components:
(1) (Pxxxxxx Fxxx Oxx)
(2) (Pxxxxxx Fxxx Oxxxx)
(3) (Pxxxxxx Fxxx Oxxxxxxxxx)
Once you learn realize what they are, you can forcast, by yourself, the POG direction.
Your Quest then, for that knowledge will begin today. Your assignment. Your homework.
Like any good Teacher/Student, I will not give you the answer directly. You alone must
discover and learn this truth for yourself. Only then will you understand and believe.
In this post I shall only give a starting point. A clue. A hint.
It is an image. A picture. Of a scale. I'd planned on linkimg to an image of the
very familiar "Godess of Justice". She, blindfolded, holds under one arm, the book
of Law. And in her other hand, the "Scale of Justice". Somewhat appropriate.
The hint is to consider POG in the right Balance, and the PFO in the left Balance.
But I couldn't find that image. In time for this post. Luckily instead, I found an
even more appropriate Scale image. A better clue. To one of the PFO components.
Klik on the link above to see it... To begin your enlightenment.
And from that, eventually you will reach your exact answer of "When will POG go UP?"
It's as simple as that.
Now I am going to sit back for awhile and let all you Knights, Lurkers, and Ladies
of this RoundTable do some thinking. For yourself. For a change. Get off the beaten
Trail. Go off into the forest, hills, mountains and meadows on your own. Fresh air.
Fresh insights. Fresh thinking. Your Vision Quest will require you to strip off all
your old concepts. Do not be afraid. For even Emporers, often have no clothes.
Once at the pinnacle bare all. Be free. Feel the Freedom. Of ultimate Knowledge.!.
I have done so. Upon a swift pony. Barebacked. Then afoot. Barefoot. Obtaining BareFact.
For many years I have tried thinking the olds ways. Lost mush money. None worked. In
this new era. But now I see. The truth. And it has set me free. To sleep alot better.
You can do it too. It's easy. I guarantee it.
Now it's time for you get on with your Vision Quest. I shall step aside and only watch
and listen as you discuss it amongst yourselves. Ask questions. Share your discoveries.
What have you to lose.?. Nothing else has given you the answer. The right answer.
from August 7, 2000 (p64) explains how a Thomas Kaplan. "an Oxford-educated historian turned hedge-fund consultant" believes he has found up to 470 million ounces of silver in the bolivian Andes. With help from George Soros among others, he has started Apex which went public in November of 1997. He's bought the land but still needs $300 million for trucks and equipment.
What I found interesting was in Kaplan bio, "While researching a PH.D. dissertation at Oxford on how British politics and the volatile rubber and tin markets shaped preindependence Malaysia, he noticed how soaring prices, which seemed always to take investors by surprise, were often preceeded by periods in which low prices bankrupted producers."
Perhaps, there is a clue here as to the timing of a higher price of gold and silver? I reread the article but found nothing about the price of broccoli which is on sale at our local A+P store this week. I agree with the Stranger: my daughter sweeps loose change out onto the ground when she cleans her car. She thinks it's funny that her dad picks it up and puts it in HIS pocket.
Laundry change is another lucrative business.
Concerning the discouraging words heard today, would you invest in something that required no carrying costs and would perhaps show a large return and possibly extremely large return but at some unknown time in the future. Obviously, don't use the mortgage money but perhaps a little of that money you were thinking of spending on ....?
or the other money that was just going to ....?
Natural gas? Then cocoa? Why not Gold?
Rich
Although it's sounds very encouraging to stay long
I have a feeling the carnage is far from over. Our
only hope is the dollar goes to the trash bin. Any other
disaster would not benefit goldbugs. Hopefully and I
have been hoping too long is gold starts to rally and the
goldbull gets born and the dollar goes south to the center
of the earth. No nukes just nuke the dollar. If your mega long gold your rich. One of few..very few. Not good odds
but we wait and see. If your wrong over the next few years
your finances are trash. A big gamble
Safer Quarters Than Ft. KnoxThanks for your input on our "national treasure". Does a safer place to keep gold include fingers, wrists, necks, and ankles of millions of Asians?
An interesting post by Christian #45494 says "all of the gold that was at FT Knox is now at 55 Water Street New York City". Is this the address of the NY FED? Journeyman {I believe} stated the gold is in Colo, NY, & Ft Knox. Most all agree has been "Watered" down considerably. Will appreciate any more FK input as this trail still smolders, if anyone has links to previous extensive discussion would be appreciated.
As far as who really cares, accepting that most in US don't,
I believe it is/will be quite important to other countries that still have prudent stocks of Au. The US Banana sooner or later has to come to grips with a near empty vault. The latest on James Turk, that I know, is that he is seriously reconsidering taking the Govt word for a secure national treasure. Seeing the govt statements regarding the ESF and gold "participation" puts a small dent in their credibility.
We should be hearing more from James T on this issue.
This is exactly why I am in total disagreement with Revelation and his advice to bail out of the gold related markets. The behind the scenes actions betray the "demonitization" of gold. Do you think all these lies, coverups, and nanipulations would go on in the zinc market {for example}? Not saying that zinc is an honest market, because I really don't know, but you may see the point. The desperation can be smelled across the ocean.
Wonder what took Randy & MK so long to figure out they could double the # of posters by just tossing in a little incentive?? Hope they have the goods this time so Gandalf doesn't have to come to the rescue again. Have ordered a stronger desk to withstand the weight of the golden vial the Wiz freighted this way. Thanks again most White Knight, can't help but smile each time I look at it.
Greatly enjoy all the new posters! Saw some poetry, humor, and great intellect. Maybe our gold "Shallow Tonsils" is among the crowd. Question........... Do you guys only post for prizes {I may have need of a few more mercenaries in the near future}? Gotta keep that talent flowing!
Nobody gets "the guaranteed homerun pitch". So, I ask you, "when is the pitch "good enough" for you to swing your bat?" Will you stand there forever still, wondering if you will ever quite grasp the rules of the game and be able to get on with enjoying your time spent "playing the larger game" (i.e., life)?
Know for yourself why you are standing there holding the bat...know what you are seeking to accomplish.
Paper currencies are merely units of account for the purpose of "keeping score" in the larger game of life. Those who have played well have a larger score to show for their efforts day to day, but a good score on one day does nothing to guarantee a successful season. Good teams play for "the trophy", not for the daily "score".
Surely you yourself do not play at your career to run up your "score". Rather, given time to think, you will acknowledge that you accept this payday score as merely an intermediate stage to meaningful physical ends...for the car, the house, the fine regular meals, etc. In this clear mind set, you will see that gold is the physical money that your currency "score" cannot possible be. To buy gold is to be mindful that you are in fact playing for the season trophy, and with it the real and greater wealth that is associated with such success.
Surely you have noticed that some wealthy men may flaunt or in turn take notice of their peer's PROPERTY, but no man of wealth gives serious mind to the "score" to be found in one's checking account. Again, they know a score can influence the joy only of today's game, but provides no guarantee for a successful season. Through spending your daily "scores" (represented by currency) to buy gold and other property representing real wealth, you can in fact lay early claim to pieces of that trophy during the mid-season. Why wait when you don't have to?!
Thanks to extraordinary market forces that have been thoroughly discussed here, you can "swing the bat" today and buy gold in the ballpark of this large 21-year dip in price. What other magical "price pitch" are you waiting for? If the paper-based price-discovery methods used for calculating spot gold result in lower prices, there is no guarantee that the physical gold market will cooperate with equal or lower premiums for delivery. In a physical supply/demand crisis, perhaps in conjunction with a derivatives crisis, the COMEX price for futures contracts will mean nothing when there are no physical gold sellers to meet demand.
Did you know that you can blithely pass up the opportunity at three perfect pitches and can thus strike out without ever swinging the bat? Sometimes the highest price is paid as a result of inaction.
Spring into action and resolve to give Centennial a call this week....because a good "score" is a terrible thing to let waste.
My opinion is that a significant part of US dollar demand is derived from the oil settlement function internationally. If the Euro is accepted for oil settlement even in a "market basket" sense, I think the dollar would take a good lick.
Your footnote has me at a loss. Did I complain about 'slow post'? What does that mean? The German I had no problem translating, but its meaning, especially with regard to any context in my post, is beyond me. It is late in my part of world, perhaps my brain is too tired, but you have me beat.
This forum has been on the cutting edge in exchanging information concerning gold. Gives insight into the financial workings for those wishing to learn about investments. I can not pretend to grasp the frustration of those who have been in the golden trenches for years. Let me give you all something to think about. I am a newbie. One of many to follow. Why? When I talk to those who are in the stock market they comment more on their loses instead of their gains. They are just plain scared to get out and so ivest more into that TITANIC to save face. Goldbugs on the other hand are frustrated to the max about the price of gold being stagnated. HOW MANY MORE BULLETS DO THEY HAVE? Who cares! When they dump the gold we buy it. We have TIME and a simple Plan. We all know that the surface gold is finite. We know the CB's want to destroy gold as money but will not dump it all at once because they are afraid of the history behind gold and need to hedge their bet. We use this time to buy wealth. 1/10th 1/4, 1/2, 1oz. at a time we will push up the demand. I believe we have those CB's by the canasta's I am going to try and squeeze them 1/10th oz at a time till they say uncle. Look around you! Wards Pennys
Auto makers Unemployment, Fed cuts, Oil prices and how about your grocery bill?
Something has to give like a bullfrog that just ate a alka-seltzer. I am not going to wish i had gold when it goes to $800.00 like it did in 1981.
So I am in the GOLDEN TRENCH hunkered down. Waitingfor others to join with me as we go over the top when the price of gold is finnally free.
There is just one point I must pick up on before I retire for the night. You say no one has made money from Gold. Well the Rothschild's didn't do too badly (they started by dealing in gold coins, and other pm's). Then there are people making a fortune with it now, I assure you - everyone's loss is someones gain in the financial markets.
One just has to be in the right trend.
One of the rules of trading is always deal in something that if you are stuck with it, you can live with it. Well, gold is so pretty, I can look at it all day. It has such a romantic past, a touch of the horrors occasionally, but that's what makes it interesting.
Zink, Cinque or as the Eye-talians say Chinque?! ...Not so...
... sorry Auspec, the Zink co., was founded by your Herbert Hoover and just came back from RTZ (the brink, naah!) to Rio Tinto (Zink)! ... and so is physical - I've always wondered why physical stands for gold only? - though we've heard about "good delivery", just as delivering paper only seems not as good ... as delivering reality - real physical 9.999 gold.
... Get physical (and, of course - it wouldn't be me unencumbered gold reserves/resources in the ground)and this is not much of a "revelation" (also welcome!), as I exchange my broccoli for energ; Not gold - (n)ever? cb2
Hello Randy,
I'm working on a long discussion between us. At my place just above the trail head. Over wine, we will travel all the way back to around 610 BC, in the area of Lidia. This will be an easy read that lays out a broad position about gold. Who knows, we may even run thru a timeline and into a fella
our other posters have mentioned, Homer? (smile) Indeed, maybe the perceptions of gold by the ancients will prove to be the best position for anyone to be in, considering the nature of what is coming.
ALL,
Well, some paper gold bugs can't understand how a failing paper pricing system for gold can hurt their mine investments. Looks like this is only the beginning. How many HMs, MENs, HLs are next? Great days for physical gold advocates,,,,,,, awful days for players of gold substitutes, no?
Physical Gold,,,,,,, nothing else can compare!
-------------------
" " Placer Dome sees no hope of higher gold price, plans massive asset write downs " "
------TORONTO (CP) -- Seeing no prospect of a significant rise in the price of gold, Placer Dome Inc. (PDG:TSE) is reducing the accounting value of its gold reserves to $300 US an ounce from $325. The world's fifth-largest gold miner also cut its estimate of its proved and probable gold reserves by almost 30 per cent.-----------
------- In light of the reduced gold-price assumption, Placer Dome's proven and probable reserves decreased to 47 million ounces as of Dec. 31, down from 65.9 million ounces that were considered economically recoverable at the end of 1999.--------------
-----------The company said the volume of reserves would be cut by a further five per cent if the long-term price of gold fell to $275 US an ounce------------
------------In the meantime, "we are relentlessly pursuing cost-reduction initiatives and other measures in response to the business environment."---------------
@ Panda - It's CoBra ... and as it seems I'm an hour ahead ...
and therefor it's later than that and it's not the year of the snakes, but for the sake of keeping awake to follow the trail of some footsteps - I usually fail - to recognise the concise bootstraps, paralyze - as giants analyse - the over-size!
No venom - Panda - though would you mind to translate
fair(i)ly - ccb2&3
Cavan Man- That was me! I hope I haven't created a confusion.
Revelation - Those bargains you mention are all imports, are they not? Low import prices provided by an artificially high dollar might indeed signify conditions of disinflation were it not for the balooning trade deficit they've produced. There will be a day of reckoning. I would have no doubt about that if I were you.
Cobra - of all the world's great skiers, the Austrians inspire the most fear, and deservedly so. Still, we Utahns will be ready for you here in the home of the Greatest Snow on Earth! Let the Games begin!
Sierra Madre - I enjoyed reading your piece. I just wish I had the time to read more of what is posted here at the Forum. Your piece makes me wonder about how much I have missed. Thanks.
PANDAGOLD......Your no Rothchild and we don't
have what they have. They make the rules and kick
out those that play for real. Try selling options and
collect premiums. They knock you out so you can't
play by excersizing the option. I know I was making
lots doing it tell they started excersizing all my positions.
Making money on gold is not going to be like you think.
Trust me, you are already being defeated by the best.
When everyone loses their incomes and jobs and investors
are completely out ...gold will rise to the stars. Not till that
day arrives. Gold will be held down till that day arrives.
Mark my words gold will explode when everyone is completely broke including the mining companies.
FOA has that part right. Paper gold will be crushed
because nothing will stand in their way to keep the
price down. Of coarse there is always exceptions
but you are dealing with the greatest powers on
earth and the odds are way out of your favor.
You think you can make money on gold.......
THINK AGAIN.
Yes, you are most correct. Although we have no
way of knowing when the game ends. One day it
will. But I'm afraid GOLD is going to be a long shot
for all most everyone unless you are connected to
inside information of the POWERS. In my opinion
this time is different than any past for gold. FOA is
so right about paper gold you can feel it in your
stomach. The worlds financial system is threated
by gold this time around like no other time. They will
not stop keeping gold in it's place until we reach
the poverty stage. By then all of us here will have sold and been taken out of our positions. Thats why few will ever
touch gold the risks are great. So don't bank on gold
most of us if not all will be crushed unless you are
completely debt free and have plenty to weather the storm.
Of coarse if you follow FOA on holding physical only.
Not many are going to be in a position to hold on.
We are not dealing with past gold markets just like
FOA refers to. Mining stocks will be the straw that breaks
the goldbugs back into poverty. IMHO
There will soon be a great demand for historians in the know re Hoover--- be ready! So zinc is not the most sanitary mkt, eh? Pretty interesting list of companies there. Your mention of CYCLES is the very reason that fortunes will be made in the longside of gold related investments VERY soon {not a time prediction, as only Job and a few others had more patience than I}. Nobody wants many of the exploration stocks now but as recently related by Paul van Eeden via fax, there is tons of activity in these companies! Many discoveries will be made that have little to do with the POG, money is made best by buying right. An example for general discussion {cb2 means 2 central banks and he knows more about mining than I ever will}: Not investment advice. One could look at a well run and capitalized Jr resource stock that is essentially a mutual fund for exploration. In current depressed market conditions they have at least 22 joint ventures going with major mining companies, meaning major interest in the props they have staked out with exploration funding by the majors. Market cap of company is about $75Canadian. This co was selling for $2.75C a week or so ago and now near $4C. You get your 22, or more as time/process continues, "chances" of major success. This company's stock sold as high as $25, with not nearly as much going, in the last bull mkt for explorers. The last mkt took a lot of stocks 5X, 10X, 25X or more and it will happen again because of CYCLES, right our Austrian US afficionado? I can start getting a bit excited when see capitulation in this mkt because of what follows. These are EXTREME times with the stocks, especially the explorers IMO, and the rewards are also likely to be extreme. Used to read about these stocks losing 90% or so of their value in late 80s to early 90s, but really couldn't fathom this historical fact. Not so hard now.
Am much more committed to your physical for 2001 because, other than what the Wiz shipped, was a bit underweighted. You are supposed to buy when things can't possibly get any worse, right? Those that are fortunate enough to enter our market in the near future have minimal downside and near unlimited upside potential. Stepping down from soapbox now.
How can one overlook the Euro? We're talking about an economic block with critical mass comparable in many respects to the US. Will the Euro zone ever be "America"--hell no (sorry Leigh)! The EC has issued by fiat an economic manifesto that they will be using a single currency etc. Now, as long as they all hang together and, get a little help from their friends they will, "make it so". For those EZ countries, the benefits of going along to get along economically far outweigh the sovereign fiat arguments. Is fiat of any stripe good as gold? No. Can one brand of fiat be made like another in quality and utility? My friend, the world is evolving right in front of our eyes.
... The old Austrian School IS unsurpassed ... and as I'm trying to convert to the latter - while I'm still 'carving' to crave the fellow (-ship} of Mises - I'm
at a loss to answer Panda on behalf of (mis-spelled) cb2 - Even though -
you know -
what it means:
when a young man invites a lady to dine
with whiskey (note spelling) and wine!
Oh, yes she knew what it meant -
That's why she went!
Understand, my friend - a few in my land - are allowed to discern - LEHRE vs LEERE - and as you've found out ...
I'm now embarassed to tout (cb2) Citizen's Band #2 ...no clout nor revenue! -cb2 - gold is a C(heap) B(uy) T(oo) -
-boo (YA) hoo...
SLINGSHOT: Consider me in for the duration! Take the lead, I'll follow. 1/10, 1/4, 1/2, 1.0 ounce at a time! START A PRECEDENT (DENYING CONSUMPTION/BUYING GOLD) THAT OUR DESCENDANTS WILL BE PROUD OF US FOR, EVEN IF WE DO NOT REALIZE OR SEE THE DAY WHEN THE GAINS WILL BE MATERIALIZED! Let's take it ALL off the table. Can't wait till we get into the UNITED STATES OF AMERICA'S stash! Like GREENIE says, Central Banks stand ready to sell adequate gold into the market place! When all the subordinates' stash is gone, we have to get into the MAIN GUY'S gold reserves. THAT WILL BE THE FIRST GOLDEN DAY FOR ALL OF US in the TRENCHES!!!!
Cavan Man said: You're forgetting about the ongoing negotiations for the Euro to settle (perhaps in a basket) oil internationally. That is the catalyst. That is the key.
Yes, I forgot about the FOA/Another prediction that OPEC would change from exchanging oil for US dollars to oil for euro. I don't know about the ongoing negotiations connected with that, in fact I didn't know there were any. I do remember the announcememts from Iraq that it would accept (only?) euro for oil. Can you shed some light on the situation?
I also forgot another important milestone in the FOA/Another scenario, which is that the LBMA/COMEX pricing of gold will, as it breaks down, send POG to zero or near zero.
I'm not yet sure of what I think or feel about the prediction that LBMA/COMEX POG will go to zero. If that were to happen quickly, I could accept it much more easily than if the trend of the last twenty years continues, which would place POG at or near zero in another 20 years. And, it would be extremely frustrating to be "reassured" that the LBMA/COMEX pricing mechanism "is just about to break," at POG $250, $200, $150, $100, and then see it level out for several years (or any such similar thing).
It's great to have gold as insurance against calamity. Done. Now I am interested in its purchasing power.
I don't wish to question or rehash any discussions concerning the powers that be or the machinations behind the price of gold or the suppression of that price. I will, however, dispute your claim that it's close to impossible to profit from gold. By profit, I mean the most mundane of all-US currency. I watched an investment of approx. $700 in gold call options rise to approx. $20,000 in a very short time in late Sept.- early Oct 1999. I was even fortunate enough to cash in on half of it. Lost the other half.
Every now and again we win!
Rich
Checked in again with the Kitco board, and it looks like the forum's village idiot, Skinny, is now the chief purveyor of info there.
He is on a rant about GATA, and although I think GATA's methodology is not always the best, I don't know what they did to deserve his constant abuse.
Of course this Skinny is in love with that pile of shit mining company known as BARRICK GOLD, employing the greatest collection of scam artists ever put together under one roof.
But alas and alack, his beloved BARRICK GOLD is stinking to high heaven, the stock price heading quickly toward another 52 week low, even as the company makes around a billion dollars a year.
My own theory is that Skinny is really Peter Munk, a backwoods sub-moron slimester who figured that if he hedged his entire company's annual production plus four years, and assisted in the destruction of gold as a financial asset, then all those profits would make him rich.
Well, so long as the clueless Barrick execs keep paying themselves from their annual hefty profits, at the expense of their shareholders, then I guess they do OK.
BUT if they are looking for share appreciation to enhance their bank accounts, forget about it. Barrick stock remains one of the most pathetic underperformers on the stock exchange, and its prognosis remains dismal.
I see your post, I have read your message but I simply don't get it. Why are the miners taking a beating?
Placer digs out of the earth real, tangible physical and yet, as from your post (and link) is raising the 'white flag'.
I am accumulating physical with my saving, a little silver, a little gold, and a little SF.
In the interim, my retirement fund (RRSP here in Canuckland) is taking a trashing with 'unhedged' (or what I perceive to be unhedged) producers; G.TO, AGE.TO mainly and a sprinkling of PDG.TO and K.TO. I sit on the edge of too nervous to be out and too god-damn bull-headed to get out while I watch my retirement fund fade into oblivion.
I think I understand the paper game, a corrupt, fractionilization of physical, distorting the 'underlying asset' but I still don't understand why miners, the guys that supply PHYSICAL to market are taking the supreme flogging that they are. Is it merely that they are at the mercy of paper prices and must sell into that crooked, corrupt state of affairs. Is it simply that they must ensure the rentless wretched ways of the 'cabal' until (and if they survive) physical separates from paper.
So let me see, a physical producer must forward and hedge to survive today to see tomorrow and consequently commits suicide in doing just that(in the event of a sudden rise of POG; a la Ashanti)? Any purely 'unhedged' producer must 'float' at spot and since production cost approaches spot renders himself non-profitable regardless. So the producers are screwed hedged or unhedged?
Why are the producers forced to sell at spot or forward at 'the contango' when governments 'trade' (countering imbalances) at $562/$564
as Christian and Tree of Life have mentioned?
Am I warm or ice cold?
This brings credence to the stories of government authorities (dictators) cornering/monopolizing gold, yes?
What is that term, governments 'nationalizing' gold mines, etc.
I would like to hear from you or anyone else on these theories.
I believe that one of two scenarios exist at this time. I have been listening and following for 3 years now.
a) I don't have a clue what's going on and I should get out.
b) This is a massive, extrordinarily crooked venture co-ordinated by very, very high levels of international governments with the motive of severely and completely distorting all aspects of financial accounting beyond any recognition of order.
In the past I have asked a couple of very pointed questions in your direction Sir Friend of Another. I apologize for that. I will blame naiviety and ignorance for that and I believe that a man of your stature might forgive that. I sense now that you have 'larger fish to fry'.
I see your post, I have read your message but I simply don't get it. Why are the miners taking a beating?
Placer digs out of the earth real, tangible physical and yet, as from your post (and link) is raising the 'white flag'.
I am accumulating physical with my saving, a little silver, a little gold, and a little SF.
In the interim, my retirement fund (RRSP here in Canuckland) is taking a trashing with 'unhedged' (or what I perceive to be unhedged) producers; G.TO, AGE.TO mainly and a sprinkling of PDG.TO and K.TO. I sit on the edge of too nervous to be out and too god-damn bull-headed to get out while I watch my retirement fund fade into oblivion.
I think I understand the paper game, a corrupt, fractionilization of physical, distorting the 'underlying asset' but I still don't understand why miners, the guys that supply PHYSICAL to market are taking the supreme flogging that they are. Is it merely that they are at the mercy of paper prices and must sell into that crooked, corrupt state of affairs. Is it simply that they must ensure the rentless wretched ways of the 'cabal' until (and if they survive) physical separates from paper.
So let me see, a physical producer must forward and hedge to survive today to see tomorrow and consequently commits suicide in doing just that(in the event of a sudden rise of POG; a la Ashanti)? Any purely 'unhedged' producer must 'float' at spot and since production cost approaches spot renders himself non-profitable regardless. So the producers are screwed hedged or unhedged?
Why are the producers forced to sell at spot or forward at 'the contango' when governments 'trade' (countering imbalances) at $562/$564
as Christian and Tree of Life have mentioned?
Am I warm or ice cold?
This brings credence to the stories of government authorities (dictators) cornering/monopolizing gold, yes?
What is that term, governments 'nationalizing' gold mines, etc.
I would like to hear from you or anyone else on these theories.
I believe that one of two scenarios exist at this time. I have been listening and following for 3 years now.
a) I don't have a clue what's going on and I should get out.
b) This is a massive, extrordinarily crooked venture co-ordinated by very, very high levels of international governments with the motive of severely and completely distorting all aspects of financial accounting beyond any recognition of order.
In the past I have asked a couple of very pointed questions in your direction Sir Friend of Another. I apologize for that. I will blame naiviety and ignorance for that and I believe that a man of your stature might forgive that. I sense now that you have 'larger fish to fry'.
GERMANS EXPECTING MASSIVE DEMAND FOR GOLD DEUTSCHEMARK COIN
The changeover to the eurito, as the Spaniards love to call it - diminutive form of the euro - is less than a year away. The Germans have no great confidence in the new currency and a majority would prefer to retain the Deutschemark as they, of all people, know what it is like to have worthless paper. It is therefore understandable that the Bundesbank, which is the country's central bank, is yielding to public pressure and starting to mint a gold version of the one-mark coin.
The 12 gramme coin will be sold this summer for around �76 which is a fairly hefty premium to the gold price assuming it will be less than 24 carat purity. It will also be double the weight of the standard coin so is likely to go under the bed rather than in the trouser pocket. Indeed there is every reason to think that all the coins will disappear overnight as only 12 tonnes of gold is being used. Presumably more will forthcomng to prevent a black market in the coins.
The idea is to celebrate the country's achievement in rising from ruin after the second world war to become one of the leaders of Europe so the coins which will have Deutsche Bundesbank rather than Bundesrepublik Deutscheland on the front. Part of the proceeds will go to a foundation that preserves the culture of Prussia, the warlike state founded about 300 years ago, and the rest of the profits to restoration of the so-called Museum Island in Berlin. Despite all Germany's efforts, therefore, to lead us into a Federation of European States, it remains locked in praise of its past.
How , then, has the European Central Bank reacted to the gold mark? It must know that even now the coins are being delivered to bunkers all around the country so that delivery to banks in different regions can be simultaneous. And this can only be the action of a country expecting a tumultuous demand for the gold coin. The total silence from the usually chatty ECB must indicate a complete sense of helplessness. This is the same bank that only a matter of weeks ago told the Spaniards that there was no way they could mint a gold peseta as it would overshadow the eurito.
The only difference is that the German coin is going to be made out of gold from the official reserves and the peseta from Spain's only producing gold mine , El Valle in northern Spain. The Spaniards are a proud people and they have a long history in gold , both in their own country and in South America. Will they really buckle down and accept the dictum of the ECB, or do their own thing?
This is a window of opportunity for the World Gold Council which failed dismally to say a word when the major producers of the world chickened out over the global millennium gold coin proposed by the late Julian Baring. Demand was expected to use up to 1,000 tonnes of gold and this would have put their bearish hedging programmes under pressure. No such problem now, so it will be interesting to see if the WGC speaks, or squeaks, on Spain's behalf.
They will lie.
They will print money.
They will fake statistics.
They will lie about the printed money.
They will 'help' people out of helicopters.
They will sell your gold until it's gone.
They will short stocks and indices.
They will take your assets.
They will hire men to obfuscate the reality.
They will hire men to 'protect' him.
They will hire another scumbag to replace the last one.
BLA BLA BLA................
Sorry boys but aint NOTHING gonna happen until the human garbage who are actively de-valuing the 'asset' decide they want 'full' value for it. Not 1 second before.
R Powell said: would you invest in something that required no carrying costs and would perhaps show a large return and possibly extremely large return but at some unknown time in the future.
If it is gold, yep, even silver. I kinda like them.
I am almost always undecided as to whether I should purchase more now or later, after the price drops some more.
Great post sir. I for one am not in a hurry to live in his new paradigm. The country I live in would be economically crushed for an indefinite period while adjustments were made etc. I suppose Canada would suffer as well. Even a gold owner fully "paid up" will have problems if confiscation becomes reality. In looking for a "hole in the fence" I can find none in any direction despite physical AU. Challenges abound. I will also say that I am a positive person although sans a "traders" mentality when it comes to investing. Having said that, I continue to expect a serious economic adjustment just around any turn.
Gold settled in dollars.
Oil settled in dollars.
Dollar is world "reserve currency".
US equities are tops.
Ergo, US debt and deficit indefinitely sustainable?
ad infinitum?
Remember, the "East" has a 100 year plan. In the land(s) of immediate gratification, we, at best, work on five year plans.
My Dad is fond of saying (rough translation from street Yiddish) "think like a Jew". I say, "think like the other 2/3 of planet earth". What conclusions do you draw then?
Those wonderful bargains you're seeing at the stores?...they're signs of desparate retailers trying to dump the remains of their undersold Christmas inventory.
As for gold, it's not for making money equal to the stock market bubble. It's for keeping your wealth after the bubble bursts. If the foretold hyperinflation arrives...in a couple of years, the economic survivors will be considered the wealthy.
www.ny.frb.orgThe best place for storing gold is with the people. Though FDR would not have agreed with this obviously. 55 Water St. in New York is the DTC (Depository Trust Co.), the holders of all stock in "street name". Some have attributed nefarious purposes to this including that said stock would be held ransom for repayment of US debt. We hold quite a bit of ransom ourselves, however, so this scenario is dubious. Chase Manhattan (Rockefeller) is also at this address I believe. The Fed is at 33 Liberty St. and claims to hold some 700 billion in foreign deposits of gold and securities. You can tour the Fed and see their vaults 5 floors below street level in bedrock. Now that should be impressive. A lot of gold in one place. The building is suitably impressive also with massive stone block walls, bars on all windows etc. They have a website with much info at above link. Regards.
IMHO, we need not be reminded by the mainstream press that Euro ministers et al are lobbying for Euro settlement of oil if only in the Euro Zone; of course they are! Wouldn't you do likewise?
A big key to the FOA/Another scenario (if not "the key") is Euro settlement of oil. If this doesn't happen well, it's been nice chatting with you fellas right? What they are prediciting and forecasting is an economic 8.0 Richter here in dollar land.
If time proves all things as they are wont to say, I predict none of us will be as sanguine about events as they.
Yes, in 9/99 I made close to $80,000 on gold stocks sold
them and bought back in. Now look at it. It's pathetic, and
the market won't budge an inch. No rally of any significance since. You were lucky, because all those
options you speak of would be worthless if you purchased
them anytime else in the last 2 years. If I was smart I would
get my sences off the gold market and would be making lots in other ways. I am being ruined by being too involved
with the gold market. Never before have I suffered so dearly. There has been plenty of other opportunities which
would have made me plenty in the last 2 years. It's really
sick when you think of what you missed because of this
silly gold market. In the last 3 weeks fortunes have been
made just buying some well known stocks. Also some time
ago I saw Phillip Morris sell off and hung onto to gold thinking it would rally. As of today I have lost big and my
life is being greatly affected. I live in California just in the last
year Real Estate has been phenomenal. Also being eyeing
LOR stock in the last week and almost sold my gold stocks
to buy into it. Well sir that stock has almost doubled since
and the fact remains Gold is losing big. Gold is sitting at
all time lows and can't even stage a small rally. This speaks
for itself. What money to be made in gold ????
PLEESSSEEEEEE ......enough....This is nonsence.
If you tried to sell options on gold they would excercise
you right out of the market. Tell me whos making money
on GOLD and where are they. The only ones making it are
the ones who set the rules. Not you or me. Stop kidding
yourself. Sorry, but this is the real world and this is how
they play the game. You think you can win. GOOD LUCK
I have never seen anyone get rich with gold yet.
" NONE"
I believe this might be good news indeed. It will be hard to surpress the public reaction to the issuing of a national gold coin. There won't be any hard-to-meet credentials necessary for purchase as there are at BOE auctions. The public may be interested in public reaction to its issuance, that is, it may prove newsworthy. The average Jane and Joe may take notice. Publicity and advertisement to stir up investor sentiment. What if this supply is (like the last BOE auction) 4.8 times oversubscribed? Father, the sleeper has awakened!
We'll see.
Rich
You said:
Remember, the "East" has a 100 year plan. In the land(s) of immediate gratification, we, at best, work on five year plans.
My Dad is fond of saying (rough translation from street Yiddish) "think like a Jew". I say, "think like the other 2/3 of planet earth". What conclusions do you draw then?
end quote
me: Not to be disagreeable, but economies that think in 100 year plans have no advantages over our "turn on a dime" philosophy. Those 5 year Soviet and Chinese planned economies proved it. Unless you include thievery of technology, of course.
In fact, any leader or people thinking back in 1900 for example that they could have a "plan" for the next 100 years would be....well to be blunt....ceding their offspring to live in the past and perform with outdated tools of any nature.
This principle remains: Economies are fluid. Forces apply pressures on all sides and ALL the time. The smallest of the economic organism needs to react with autonomy to respond to these forces.
I don't think there is much in the East that I am enviable of. Not their economies, not their spirit, not their way of life. Not that I don't respect parts of the their heritage. But I will take our freedom for immediate gratification ANY DAY. Why? because the results of our choices are immediately ours. Good or bad. And they are our own.
You know, in a way we really do have a 100 year plan, we just make many more decisions, have much more results and much more reward during that 100 years. And the plan is, with little exception, in the world, the plan of lassez faire.
You are then hoping for hyperinflation just what
everyone needs. You should read Peter Bernsteins
book " THE POWER OF GOLD" and in the last
chapter he tells us that most of the worlds goldbugs
got their own fate right back in their own laps. The last chapter was a real surprise to say the least. People who
hoarded gold always had a sad ending. If you purchase
gold for insurance and use a small part of your wealth
thats fine but to hoard it will bring you misery. Read his
book I found it to be wealth of information and don't
be a goldbug or else. Play if you will but only small
portion of your wealth is the best advise.
I don't mean to belittle your lose and I do feel badly for all who unfairly loose money in rigged markets. I don't believe large amounts of money should be invested in any market whose fundamentals are as obscure as gold or silver. I try to analyse supply and demand to determine ending (carryover)stocks at the end of the market year. This ending stock divided by total use gives a percentage number suitable for previous years price comparison. This approach does NOT work with gold as it does with cotton or corn.
Perhaps large investments in metals should be in physical for the Long-term and with money that will not be needed in the Short-term. Small option investments in gold should be with gambling money that can be lost without family suffering. Perhaps there's a buck or two to be made elsewhere, like a possible short squeeze in cotton, or something else to diversify until gold and silver fly again.
A few long term out of the money options but don't bet the farm. This is not trading advice but is presented for discussion purposes only. Having come this far, think of what it would be like to watch it happen with no options or physical.
Trade within your own limits and don't sacrifice health and happiness for percieved wealth. Peace.
Rich
For Al Fulchino and Cavan Man. Thought I'd mention that in my searching for cotton crop information from China, I'm often reminded that all is going exceptionally well in this-the beginning of the 9th Five-year plan for textile development in China. They report it without humor and, actually, there are doing quite well. Well enough to not have much cotton for export and well enough to have currency to buy gold.
I'm in the middle of my 11th Five-year plan and am still trying to get it right.
Rich
I have recently read the book by Mr. Bernstein you hold in such high regard, "The Power of Gold". Yes, in places he provides commentary very rich with anti-gold sentiment. Does that impress you? Has it occurred to you that beyond the role of historian Mr. Bernstein may have an agenda with regard to his economic bets? His economic consultancy is surely to be advantaged by these efforts, no? Would he not "talk his (economic) book" within his own book? Absolutely.
A delightful telling of much history, to be sure, and he will likely make many thousands in sales on the strength of the pretty cover alone. But be advised, what he understands -- or should I say chooses to reveal -- about the undercurrent role of gold in the modern economic framework fills only a thimble in the comprehensive ocean of the modern "power of gold". Such are my words to you and all that may be so easily influenced and led astray by something so nicely bound in hardcover.
Attn: slingshot (01/24/01; 21:39:17MT - usagold.com msg#: 46382)slingshot writes:
PROFITS FROM OIL
PROFITS FROM OPIUM
PROFITS FROM OPIUMUSERS
==============================
Not bad. 2 out of three.
But how could an opium_user (junkie) ever
show a profit.?. Keep thinking. Keep riding.
I think you got the point about buying PMs. They can be an investment per se, however, they are best suited as insurance. In an ever increasing uncertain world, it is ever more imperative to buy this kind of "insurance", especially while it is at depressed bargain prices. With energy prices increasing and causing a serious drag on the economy as some of us have talked about over the last few years, the general public is just now beginning to get the "point" as they receive their utility bills, pay at the pump, or stumble about in the dark. The Feds say "all is well," and when they say such things, then beware. It's as dangerous as when they say "Hi, I'm from the government and I'm here to help you."
I'll be very candid with you and straight forward. At least
he's not afraid or in deniel of the real truth behind golds
fate (Peter Bernsteins) The Power Of Gold. I happen to
firmly believe in his analysis of what to expect when a
individual hoards gold. Sorry, but many posters have
been wrong with their thoughts on this market. It
served no purpose in reading all the false hopes set out for
gold. Nothing to this day has become a reality but a severe
disappointment in search of false prophecies. If I would
choose to listen to someone wouldn't you select someone
with credebility. I'm here only because I don't want to
lose faith but it's getting more difficult all the time. The more
time that passes the harder I kick myself. Opportunities are
being lost and still hanging onto a hope and dream that
is made up of mostly fate. Gold is no means the secret to
wealth. If it were true none of you would be here. It's
very obvious and not exactly hard to figure. I'm only stating
the facts. It's up to you if you believe in something else,
however gold might rally but it all depends on how they
fine tune the economy. The jury is still out if gold can
maintain it's current price level never mind rally in the
face of a recession. Goldbugs hope is hyperinflation
which will come back to haunt the very people who
wished for it. The dollar is the key for gold and to
wish for something worse is even more stupid. How
about nukes ???? Do you think we can rally gold
then. Lets get real, hoarding gold can be a persons
demise. Are we on the same page. Buying gold for insurance and hoarding are not the same. My own
learning curve is a long one. Lets hope others can
learn from some of our misfortunes and to keep control
over gold buying sprees.
I hope you don't linger here much longer. You've had your say, and have been civilly treated by others, who think differently from you.
You are whining about gold. So whose fault is it? Do we like the situation? No! Do we whine about it? No.
So you think it s...s? OK
Then sell your miserable gold and do something with your life. Nobody is forcing you to buy gold or keep it. So if others do want to buy gold and hold it, what business is that of yours?
I hope you don't mean to plague this Forum like uptick, goldbuggerer and skinny plague kitco. The reason I like this Forum is that they are not here. Are you one of their incarnations?
I do opoligize if you have taken things offensively. Only
trying to state the facts regarding gold investing. Just
trying to devide or draw a line in the sand on putting too
much money to work in the gold market. I bid you goodnite
and hope all our dreams are golden. View
Yesterday's Discussion.
Attn: lamprey_65 (01/24/01; 23:23:43MT - usagold.com msg#: 46393)Hi lamprey_65
That's a nifty link you posted to a CrossWord Puzle solver.
Alas, you won't be able to use that. Because of my writing
style. I often makup new words, using two words, with capital
letters showing where each word begins. It's an old trick, used
by programmers in their code. To confuse themselves.
So it's very unfair of me for having inadvertantly done that as:
PFO(3):
Pxxxxxx Fxxx Oxxxxxxxxx
So, just for you (I hope nobody else sees this) try instead:
The Energy Crisis is Spreading Like Wildfire Across the Land
ENERGY CRISIS SPREADS ACROSS THE US:
1) EVEN THOSE IN TEXAS ARE NOT IMMUNE:
Utility Customers Protest High Rates
CPS May Give Rebates
Thanks to a huge hike in natural gas prices some folks in San Antonio have a hard choice to make this month -- pay your gas bill or eat. An angry crowd gathered at City Hall Wednesday afternoon to protest their bills. Many people have seen their gas bills double, triple, even quadruple recently because of the cold weather and skyrocketing natural gas prices. Many who gathered at City Hall said that they wanted to show City Public Service and city leaders they're unhappy about those high prices. They said that the increases hit those who just scrape by or live on fixed incomes hardest and they want the city to help. "I make between $500 and $1,000 a month so everything is donations and offering and this is about 70 percent of the income here," bill protestor Rev. Antonio Palacio said.
"It's rough. They have to make a decision; buying food for the table or paying their electric bill," bill protestor Jaime Martinez said. "We are also outraged with the bills that we have been getting. Double, triple some of them are four times what it normally is," another bill protestor said. CPS is working on a plan to give gas customers a rebate of about $28 on their next bill. Officials said that they are doing all that they can to keep rates as low as possible. "We have offered money saving tips since December. We have granted an additional $600,000 in pay agreements an pay extensions," CPS spokeswoman Betty Williams said. CPS is presenting the plan to give customers a rebate to the City Council Thursday.
2) RATES TO RISE IN MISSOURI:
Missouri Gas Energy gets approval to raise rates 44 percent
By STEVE EVERLY - The Kansas City Star
Customers of Missouri Gas Energy must pay 44 percent more for natural gas use starting today, under a 3-2 decision Tuesday by the Missouri Public Service Commission. The increase, from $6.81 to $9.82 for a thousand cubic feet of gas, gives the utility the highest purchased gas adjustment charge ever in Missouri. Combined with previous increases, the raise means Missouri Gas Energy customers will soon receive bills that are more than double bills from a year ago for the same amount of gas. And that still may not be the end of higher gas rates. Missouri Gas Energy said in documents filed with regulators that it still could have a shortfall of $18 million, or 26 cents per thousand cubic feet of gas. Those costs could be collected next winter, if regulators approve.
3) OF COURSE MICHIGAN IS ALWAYS COLD IN WINTER:
Heating cost may double
BY ALEJANDRO BODIPO-MEMBA, FREE PRESS BUSINESS WRITER
Michigan's two largest natural-gas providers plan rate increases of up to 100 percent. Consumers Energy Co. intends to double its rates April 1. Michigan Consolidated Gas Co. seeks state approval to raise its rates by about 75 percent on the same day, but proposes credits which a spokesman said would soften the blow. MichCon, a unit of Detroit-based MCN Energy Group, wants the state Public Service Commission to approve a rate increase to $5.17 per thousand cubic feet. That's an increase of more than 75 percent over the current price of $2.95, which has been frozen since 1998 as part of the company's customer choice program. The average MichCon residential gas bill, not including fees, taxes or charges, would go from $398.25 a year to $697.95. The utility also is seeking to terminate its customer choice program nine months early. MichCon's program -- and rate freeze -- would otherwise not end until Dec. 31.
4) KALIFORNIA�S WOES NOT EVEN CLOSE TO BEING OVER:
Calif.'s natgas market remains fragile despite reprieve
By Spencer Swartz
SAN FRANCISCO, Jan 24 (Reuters) - Milder weather has eased energy demand in California, but the outlook for high natural gas prices through this year are likely due to a host of factors, including the lack of gas supplies. ``It's likely that we'll see price spikes through the summer because of the low supply situation. It will be tight and it could be pretty expensive...it's a bad situation,'' Jen Snyder, Director of North American Gas at Cambridge Energy Research Associates in Massachusetts, said. California's gas crunch began last summer when gas-fired power generation -- about a third of the state's total power needs -- ran almost non-stop to meet the crush of air Conditioning demand. The gas squeeze also followed a drop in hydro electric imports into California from the Pacific Northwest, which typically supplies close to 11 percent of the state's power. When Northwest power imports fall the laws of scarcity take over as power generators, businesses and homes in California compete for natural gas, driving up prices.
To make matters worse, California has seen gas increasingly siphoned away to high growth areas like Las Vegas in neighboring Nevada and it lacks sufficient pipeline capacity to import more gas, according to Bill Wood, chief natural gas forecaster at the California Energy Commission. Four days of gas cuts last week to some non-core industrial customers in San Diego resulted from the local gas utility's need to conserve gas to maintain pressure in its pipeline system and the inability to import gas to meet cold weather-related demand, analysts said. The recent power crisis in California -- which has left the state's largest utilities teetering on the edge of bankruptcy -- has also compounded problems for buying and holding gas. For a number of days, many out-of-state gas suppliers quit selling to cash-strapped utility Pacific Gas & Electric (PG&E), which has piled up nearly $7 billion in power costs it cannot pass onto customers due to a retail rate cap, on fears they would not get paid. As a result, San Francisco-based PG&E, a unit of PG&E Corp. (NYSE:PCG), leaned heavily on storage gas to meet the daily needs of its 3.8 million gas customers -- a trend, which if continued, would likely put the utility's gas storage at historically low levels by the end of winter.
CALIFORNIA NOT ALONE
Low gas supplies in California have kept wholesale gas prices at the Southern California Border, a major delivery point, above $10 per million British thermal units, more than triple normal levels, for nearly three months. Such prices, the highest in the U.S. but down from all time highs of $70 at Socal Border in late November, have punished industrial users, sent home heating bills soaring and triggered investigations and lawsuits into anti-competitive practices. California is not alone in having strained gas supplies and high prices. Gas inventories in the West and nationwide have been stretched drum-tight the past year due to less productive gas fields and the industry's sharp cutback in new drilling activity after three years of mild winters, sluggish demand and depressed energy prices in 1997-1998. High demand from the residential sector and the power industry, which has shunned coal and oil for environmental and economic reasons, has also pressured gas supplies -- and sent heating bills and power bills soaring around the U.S. With around two months of winter remaining, gas supplies in the U.S. and in the West could be drained to record low levels by summer, when air conditioners typically push power demand to its annual peak. And in California, the energy outlook could grow worse as the Pacific Northwest loses patience with feeding California's hydro habit that has caused high power prices in the region. A poor snow and rain season in the Northwest could also strain power imports into California, which would stoke gas demand and aggravate the power shortages that are expected to continue in the state through summer.
Black Blade: And there are still those who wish to assert that inflation is "benign" or not reflected in the "core-rate" of the CPI and PPI. Choose whatever euphemism you wish, the truth of the matter is that inflation is coming to a utility near you. Costs of goods and service MUST rise and be passed along to the consumer. As The Stranger points out, the huge overhang of the trade deficit will come back to haunt us. Gold and silver as insurance in a well diversified portfolio is just a common sense move.
01/24/2001 - Updated 11:59 PM ET
By George Hager, USA TODAY
Federal Reserve Chairman Alan Greenspan is
expected to endorse tax cuts at a Senate hearing
today, modifying his long-held stance that the
single best use for burgeoning federal surpluses
is paying down the national debt. Sources
familiar with Greenspan's views say the Fed
chairman believes huge new forecasts of the
surplus are legitimate and big enough to
accommodate both substantial debt reduction and
tax cuts.
Further, Greenspan is said to worry that unless Congress devotes a sizable
piece of the surplus to tax cuts, the alternatives would be large new government
spending or government investment in stocks, which Greenspan believes are
poor ideas.
Greenspan will speak to the Senate Budget Committee just as Congress begins
to take up President Bush's proposal for a $1.6 trillion, 10-year tax-cut package.
Though it's far from clear that Greenspan will embrace either the size or
makeup of the Bush proposal, his new support for the concept of tax cuts is
likely to hearten the White House and add major momentum to passage of a tax
cut this year.
Senate Budget Committee Chairman Pete Domenici, R-N.M., confirmed
Wednesday that Greenspan's familiar contention that tax cuts are a distant
second-best to debt reduction is "apt to change" at today's hearing, largely
"because the surplus is so big."
However, Sen. Kent Conrad, D-N.D., the committee's senior Democrat,
emphasized that a realistic view of even the big surplus estimates leaves room
for a tax cut of about $700 billion over 10 years.
Just last July, the Congressional Budget Office projected a 10-year surplus of
$4.6 trillion. That's expected to balloon to $5.7 trillion when CBO issues a new
forecast this month.
Greenspan won't be talking just about tax cuts. Fed watchers and investors are
waiting to hear his prognosis for the economy, which has slowed sharply since
last month. That has prompted some economists to declare that the country has
entered a recession.
Several senior Fed officials have emphasized in recent speeches that though the
economy faces a risky period of subpar growth, it should avoid an outright
recession. Though it's possible that Greenspan could change the Fed's official
outlook today, analysts expect he will echo his colleagues' assertions.
The financial markets will also be listening closely for any hint about the size of
the interest rate cuts policymakers are expected to make when the Fed meets
next week.
Investors who bet on the Fed's rate moves overwhelmingly expect the Fed will
make another unusually large, half-point rate cut, instead of the more cautious
quarter-point move that Greenspan's Fed customarily makes.
NightLine's "news" ... They get it Late.. Everytime.!.
Attn: Black Blade ... You've put us ahead of the curve so often.Hi Black Blade
Just finished watching ABC TV's NightLine. Tonight's episode
focused on the California Electricity shortage. Their three
expert panelists were two reporters, and a befuddled professor
from someplace.
They did a poor job of explaining it all to Ted Koppel, himself
apparently clueless, by his questions and spinning of it all.
And incredibly, the panelists were all in agreement that such
problems were not going to spread to other states. And the
natural gas shortage wasn't defined further than "higer NG
prices". And that everything in California will work itself out
favorably in a few weeks. Trust them.
I'd just like to say to you, Black Blade, how grateful we in this
forum should be to you, for bringing this (and much more) to
our attention daily, and in such fine detail. We in this forum
are months-ahead of the news curve of the masses.
And maybe even years ahead of ABC NightLine. Thank you.!.
Another opinion is always refreshing and needed. Whether i agree with you or not is irrelevant.
I think far too many on this forum have a set view and are too ready to believe the opinions of other posters, who preach what they want to hear, without question.
Thankyou and you are most welcome. The energy crisis will play itself out in higher costs as it always has. History is a fine teacher. Every postwar recession has been preceded by an energy crisis. Why should things be "different" this time? That's what they said about the Dot.Com mania, and now they're Dot.Gone. That's just the nature of man. My business has suffered as the mining industry has pretty much closed up shop. I am now focussing on the NG and oil business. I know many in my line of work have already made the switch, and I am about to follow in a few weeks after I finish up some projects for a couple of gold mines. I'm afraid that the gold mining companies have "cut their own throats" with such ridiculous antics such as forward sales, etc. They will be hard pressed to find a lot of professional staff when gold rebounds as most are now in other fields of interest and the universities don't produce people with skills in mining. I've seen many lose homes and families break up in gold country, so I have no sympathy for the gold companies. I'm lucky enough to have contacts and experience in petroleum and I will soon move on to "greener pastures" for a while. The petroleum business will boom for a while with the growing demand for energy resulting from the "New Economy", the lack of preparation by utilities in over-regulated states, severe environmental restrictions, and the growing population. This energy crisis was so visible that it was next to impossible not to recognize what was happening. Anyone with a "big-picture" view of the world would have known that energy fuels everything. It is essential to Hydro-Carbon Man's existence, energy was being consumed, and very little was being replaced. In fact only 1 bbl of oil was discovered for every 4 bbl consumed. In the meantime, I will purchase PMs while they're cheap (maybe for a very long time). Cheers!
Attn: Topaz (1/25/2001; 2:57:02MT - usagold.com msg#: 46402)Hi Topaz
You have my attention. You may put your hand down.
And rest your Pony. You have all done well, and quickly.
We now know that:
PFO is:
(1) Profits From Oil
(2) Profits From Opium
(3) Profits From OtherDrugs
But you cannot rest upon your laurals. Not yet. You all have
learned so far only the definition of PFO. Now your quest must
discover why the inverse relationship exists to POG.
Note: The above PFO is *PROFITs* of Etc. Not *PRICE* of Etc.
Meanwhile, let us prevail upon Sir Black Blade to give us an
estimate of the total barrels per DAY exported by OPEC. And
let's have some Knight or Lady step forward with an abacus
to multiply that number, times the POO (price of Oil). Would
we be surprised that it is a staggering US$ sum.?. Oh... and
we can toss in a few million in Euros, to please others who
feel that's a factor somehow. (Which it isn't).
And when we have those numbers before us, you may then
go astride your Pony(s) once again. Isn't the air (and thinking)
fresh way out here away from the beaten Trail.!.
New Energy and Natural Resource Cabinet Sectretaries, But Real Progess in Doubt?
Source: Oil and Gas JournalBush nominees face Senate confirmation hearings
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Former Sen. Spencer Abraham (R-Mich.), President George W. Bush's nominee for Energy Secretary, sailed through
confirmation hearings last week in front of the Senate Energy and Natural Resources Committee, and was approved by the full Senate on Saturday. Controversial Interior Secretary nominee Gale Norton, a former attorney general in Colorado, faced more rigorous questioning from senators during her hearing, but is expected to receive committee approval this Wednesday. As a senator, Abraham cosponsored legislation that would have dismantled the Energy Department and moved most of its functions to other agencies. During his confirmation hearing Thursday, Abraham told the energy committee that due to recent developments like the passage of the National Nuclear Security Administration Act and the deepening energy crisis, "I no longer support this legislation and its various components, such as the privatization of the federal power marketing ministrations." He said the Bush administration plans a "cooperative effort" with Congress to address high energy prices, tight supply, and growing dependence on foreign producers -- although he offered little in the way of details. "President-elect Bush and I are deeply committed to developing an energy policy that includes increasing domestic production of energy in an environmentally responsible manner, increasing our use of renewable energy, decreasing our reliance on imported oil, and developing new technologies that conserve fossil fuels and reduce energy-related pollution." Pointing to the nation's increasing dependence on foreign oil -- more than 57% now, compared to only 36% during the oil crisis of the 1970s -- and to the booming demand for energy, Abraham said the economy is "directly linked to assuring adequate supplies of
reasonably priced energy." He avoided direct statements about opening more public lands for oil and gas drilling or means to increase production. He did make some specific statements supporting continued development of technologies to find cleaner ways to burn coal and advance the use of fuel cells for powering automobiles. Several western senators, including Frank Murkowski (R-Alas.), Ben Nighthorse Campbell (R-Colo.), and Craig Thomas (R-Wyo.), were less circumspect than the nominee, castigating the Clinton administration for restricting oil and gas production on public lands. "We have a lot of multiple use lands that ought to be made more available," Thomas said.
Senators also called for an interagency approach to energy issues -- involving the Energy Department, the Interior Department, and the Environmental Protection Agency -- a concept Abraham said he fully supported. Murkowski said, "We need to try to generate a balance between a legitimate concern over the environment . . . and the reality that energy has to come from some source." Abraham was questioned frequently during the hearing about the current electricity crisis in California, but he limited his comments to saying the new administration regarded the matter as a priority, and that he would look closely at possible solutions upon taking office.
Norton says Bush to push for ANWR opening
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Interior Sec. nominee Gale Norton made it clear, in confirmation hearings that ended Friday, that President George W. Bush will honor his campaign pledge to open the Arctic National Wildlife Refuge coastal plain to oil exploration. However, she said the administration expects to impose a number of rules to limit environmental impact in the northeastern Alaska area. Despite vociferous opposition to Norton from environmental groups, the Energy Committee is expected to approve her nomination on Wednesday. Senate confirmation also is expected. Norton said oil companies would only explore ANWR "in the dead of winter, so that the tundra itself would not be affected; it would only be ice on top of the tundra where any vehicles might roll. "Those are the kind of measures that are being discussed. We would certainly look to ways of trying to satisfy you that an environmentally sound approach can be done to try to look at reserves that we have heard are estimated to be larger than Prudhoe Bay, the largest oil area ever found in the US." Norton noted that the final decision on opening the refuge would rest with Congress, not with herself or with Bush. Sen. Ron Wyden (D-Ore.) attacked her position, but she was supported by chairman Frank Murkowski (R-Alas.) and Sen. Don Nickles (R-Okla.). Nickles said, "The Prudhoe Bay area, which originally had production of up to 2 million b/d, is now less than 1 million b/d. Prudhoe Bay is declining and in my opinion we need to open the ANWR to supplement that or else we're going to have an even greater dependency" on foreign oil.
Labeled by some as an extreme pro-business, anti-environment conservative, particularly because of her work with former Interior Sec. James Watt, Norton expressed moderate positions in 2 days of calm, relaxed testimony which won the vocal admiration of senators from both parties. However, she made it clear that under the new administration, Interior would take a very different approach than the current administration in several areas. For instance, she said Interior would consult with local officials before announcing the creation of national monuments. Sen. Bob Graham (D-Fla.) questioned Norton closely on her support for the current moratoria that prevent drilling off his state and others, and whether she would offer tracts in those areas in the leasing program the Minerals Management Service is drafting for 2002-2007. Graham said he had been informed that the energy industry was preparing to lobby for inclusion of those areas in the plan, despite the moratoria, and that Norton "would be the point of pressure for that
industry interest." Norton said she agreed with Bush's support for the moratoria and said she expected the program "to reflect the conditions of the moratoria that are in place." Both Graham and Murkowski also urged Norton to revise the offshore leasing procedure to ensure environmental assessments are made before leases are offered, to prevent situations where companies are blocked from developing leases later. "It would seem to me to make much more sense to do much of that (environmental assessment) at the front end, and if there's a site that is found to be inappropriate for environmental reasons, you don't grant the lease in the beginning," Graham said. He implied Congress may change the leasing process with legislation.
Black Blade: The energy crisis will get a lot worse before it gets better, regardless of the Wall Street pundits. It will take years to bring new oil and NG into production.
http://www.mrci.com/qpnight.htmGold already down another $1.30, and the Euro is getting a real drubbing as it heads back toward $0.82? Maybe Dim Wim is giving press interviews again. Should be an interesting week. Today, Cheeta (AG) tosses a few bananas to the apes in the senate. While Cheeta chatters and the apes nod in agreement with glazed-over blank looks on their faces, the economy continues to spiral outta control. That should keep the bipedal primates happy for a while.
Hello Rev, from the sunny shores of Oz.
I've often pondered frustration and abject dispair that must reside just below the surface when considering long term Gold investors.
My heart (sincerely) goes out to you.
"Profiting" from gold can be and is defined every day the world over - the Indonesian peasant who bought the rice paddy when the rupiah went belly up - is but one example, and if I may be so bold, do not think "it can't happen here" (there or anywhere).
Currently there seems no pressing need to hold all your wealth in Physical metal (however I do) - 12 Mth's ago there were many LESS reasons, 12 Mth's prior to that infinately moreso (in hindsight).
I just finished "whacking Kenny" ( a computer generated version of the Arcade game where a head bob's up and you whack it with a mallet, then another, and another and so on - the longer the game goes , the faster the heads pop up - great fun although bloody stressful!!)
Well, that's what's happening NOW in GLOBAL Fiatsville IMO - and they are pretty good at it - "Kenny's head" (in this context anything that might upset the Applecart) is bobbing up all over the place and, to date, they've kept whacking him - faster and faster, heads everywhere, WHACK!-WHACK!-WHACK!!
and - like me on the 'puter, there comes a time, with sweat running down their faces, hands shaking, eyeballs swimming around in their head, when they'll say......"STUFF KENNY, WE'RE DONE".....and just like me, 10 secs after they're "finished" they'll say "why in the hell did we muck around with this for SO LONG?"
In his or her defense, I find the viewpoint disturbing but quite valid. No one wants to hear that what they have chosen as a significant life choice may suddenly become a question of only benefiting from it if the rest of the world's choice goes into the crapper. Frankly, most of us didn't know this when we got into this and therein lies the big fraud that GATA and Howe and each of us in our own ways seek remedy. It isn't right that it has become the dollar or us, but it did, so what are we going to do about it?
We didn't cause this problem; we know who did and why. And it is a sad state of affairs only brought to light by the freedom of speach and world stage of the Internet.
Huh? What's this? Gold up +$0.50 and Silver up 5 cents. That can't be right. Hmmm�. NG moving higher too. Too many balls in the air for the power brokers? ;-)
Duty CallsWas it Soros....... something about "detecting the folly of Government and punishing it"? Just simply doing our civic duty if nothing else. What a monster govt would be if the free market forces weren't there to keep them in check. We are this free market mechanism! What is new in Revelation's repeated messages? Someone here on Forum was unaware of the various risks of this market niche? There is plenty of money to be made w/o the total collapse of the US Banana; ratchet gold up a bit and opportunities really abound. I believe they abound right now simply because the pendulum has swung too far, and affected entities that have little to do with gold itself {resource explorers in general}. The need for various raw materials isn't going away.
I made good money {futures} on the spike in gold after WA, and then flushed it back shorting the S&P. Was delighted to have the opportunity to go after the S&P because I didn't think they could keep it glued together in late 2000. Hats off to Cheetah! Was the risk known ahead of time? Of course. Lose any sleep? No. That's the key, IMO, if you are unable to handle the consequences of the risks you take, then it IS time to move on as Revelation is doing. That's the right decision for him. I've left markets early in the past because of lack of patience, and lived to regret same. Maybe R is in process of this lesson, maybe not.
You are so right, most of us didn't know what we were up against upon starting this hike. Now that the folly is so apparent, however, wouldn't personally dream of pulling away. On the other hand, if everything you own is gold related and the expectation for the future is to continue this pattern indefinitely, the folly might not just belong to govmt!
Steve H- Am looking forward to your continued input as the GATA saga unfolds further, as you have expressed a degree of skepticism in past posts that they will be able to dissect the existing "system" and obtain much remedy. They are knocking on some interesting doors these next few weeks hoping to stock up on enough Bananas to lure Cheetah, and fellow primates out into the open so we can more clearly see their monkey business. Mostly just proving for ALL to see what is fairly well known by the few. With proper funding GATA is quite likely to make transparent some real govt folly.
Got a front row seat? Got GATA?
R Powell (01/24/01; 22:30:15MT - usagold.com msg#: 46388)
You wrote in part:
Five year plans
For Al Fulchino and Cavan Man. Thought I'd mention that in my searching for cotton crop information from China, I'm often reminded that all is going exceptionally well in this-the beginning of the 9th Five-year plan for textile development in China. They report it without humor and, actually, there are doing quite well. Well enough to not have much cotton for export and well enough to have currency to buy gold.
me: Tongue in cheek, yes???? Who here would trade place for Chinese citizenship, either economic or political?
With increased profits from oil, opium, and other drugs we then get a decreased price of gold. Somehow there is a greater supply of gold on market because of this and we are obviously dealing in the undermarkets. Maybe gold has come to market in exchange for these items giving increased gold supply to suppress POG. So these gents can make so much money in the 3 O's that they will divest themselves of their Au. Is that a Bingo?
http://www.usagold.com/NewGoldMarket.html Just wanted to let you know I found that to be a exceptional post. Among other things, you remind readers that the value/performance of gold throughout the world is not to be confused or downplayed by the limited perspective as cited by some of its detractors when seen through American eyes wearing dollar-colored glasses.
To add further weight to your comments, here is an excerpt from one of our Gilded Opinion articles (URL given above) citing August 1999 reflections of the recently passed Asian currency crisis by WGC's Albert Cheng, Regional Director, East Asia, Singapore.
EXCERPT FOLLOWS
------------
The recovery in East Asia except Japan continues, as indicated by the strong Q2 demand, particularly Indonesia, Thailand, South Korea, Taiwan, and Vietnam ... the strongest since the outbreak of the Asian Economic Crisis.
The recovery in Indonesia was very strong during the second quarter. Demand was 65% higher than in the opening three months of 1999 and a record for the second quarter. Allow me to spend a few minutes to talk a little bit more about the background of the recovery story from Indonesia, the star performer in East Asia in the last quarter.
Gold in Indonesia, as in some other Asian countries, is primarily bought as a store of wealth by the rural community. This practice had some interesting consequences during the recent economic crisis.
The crisis led to the Rupiah plummeting against the dollar, reaching at one stage nearly Rp17,000=US$1.00 compared to the pre-crisis level of Rp2,500=US$1.00. Conversely the local price of gold soared from around Rp20,000 per gram to reach Rp130,000 per gram.
While urban residents with savings in Rupiah suffered badly, rural residents benefited from the soaring gold price. Many sold their jewellery at this stage and used the proceeds to buy land or cattle or to finance new businesses. Along with distress sales, illegal mining and retail stock liquidation, it is thought that as much as 100 tonnes of gold were exported during January-April 1998. There was thus a net increase in wealth in rural areas, which may explain why they were largely unaffected by the civil riots and looting of May 1998.
In August 1998, harvests were good and farmers started to purchase gold once more despite the high price - although quantities bought were smaller than in pre-crisis days. An improving economic and political environment towards the end of the year resulted in the Rupiah gaining ground against the dollar and the local gold price of gold become cheaper. Rural gold purchases rose sharply, reaching 80% of pre-crisis levels. Buying increased further in the first half of 1999 with the continuing relative strength of the Rupiah and the fall in international gold prices.
Elsewhere in the region, second quarter demand in Thailand was four times the level of the same period of last year, in Malaysia there was a 21% gain year on year, while demand in Vietnam was up 18%....
The lessons of the Asian economic and currency crisis have not been forgotten. During the first quarter of last year, there were people in Indonesia and other Asian countries who were only able to buy food and other necessities because they had some gold they could sell.
I want to close today with just one example from a survey we conducted late last year in Indonesia. Mrs. Latiyem told our interviewer, and I quote:
"I didn't have anything, that is why I sold my gold necklace to buy essentials. I bought things like coconut oil, soap and a paddy field. Once I have sold the rice, I may be able to buy back my gold with the profits."
Mrs. Latiyem and anyone who has heard her story will not forget this powerful demonstration of gold's traditional role as a store of value and an asset of last resort.
In fact, the numbers we have been presenting today about gold demand all around the world show quite clearly that this lesson has not been forgotten. The steady growth in gold demand, especially among those Asian countries hardest hit by the economic and currency crisis, provides solid evidence that the people who sold gold in the first quarter of 1998 started to buy it back as early as the second quarter of that year. The buying grew steadily though the remainder of 1998, and continued to grow throughout the first half of this year as well.
The big story in investment over the past decade has been all about the accumulation of wealth. As a consequence of the economic shocks of the past year and a half, the big investment story is starting to be about the preservation of wealth. In their search for ways to achieve that goal, investors are turning increasingly to gold.
--------
END EXCERPT
It is also instructive to have a look at gold through the eyes of a Turkish citizen wearing lira-colored glasses.
At the start of 1996, one ounce of gold was seen locally as equivalent to an account of 20 million lira.
Just five short years later that same one ounce of gold has aptly demonstrated its superiority as a savings asset. The much wiser and experienced eyes of the locals now see from the tough teacher of experience that in order to equate with the value of that original ounce it now requires a bank account of over 180 million lira.
Or put another way, the original paper savings of 20 million lira has fallen in "real wealth" value to only one-ninth ounce of gold...an unnecessary loss due to poor chance and choice of holdings.
Time to swing the bat. (Reference to yesterday's post)
http://www.usagold.com/onlinestore/special.htmlThe latest selloff in paper derivatives of gold has given us a mathematical price for the real McCoy at very affordable levels for those looking to either establish for the first time their core holding of gold as a portfolio diversifier, or for those looking to add to their existing holdings.
Call Centennial for the best prices on a wide variety of gold coins and bullion. Also, our remaining Dutch Kings available for on-line ordering (link above) are again at their best price.
---
Other business...TrailGuide, thank you for the note yesterday. I very much look forward to it!!
Randy @the tower #46414I am slow, no doubt about it, but i did catch this one thing shining brightly in Randy's exerpt noted in his message above.
Snip-"I didn't have anything, that is why I sold my gold necklace to buy essentials. I bought things like coconut oil, soap and a paddy field. Once I have sold the rice, I may be able to buy back my gold with the profits."-unsnip
This poor lady said "I may be able to buy back my gold with the PROFITS."
The profits.
The profits?
Does that mean she gets her gold back and still gets to keep her paddy?
And all in trade for a few december Gold calls that she had fashioned into a paper necklace and wore around her neck, right Sir Revelation?
(No disrespect intended, Sir)
What Soros says, and does, like so many of his ilk are two different things. As I have pointed out before. He is careful not to try and 'punish' the US government - the greatest offenders of all. Dogs dont't sh*t on their own doorstep.
It it was the voluntary handing in of gold to their government by the Koreans that helped save the Korean economy following the Soros, and gang, inflicted so called 'punishment'.
What were these Asian nations doing but following US taught
methods of debt exploitation. Where they ran foul was trying to keep the US based but otherwise international economic gangsters out.
I will repeat this often. TPTB are NOT anti-gold,, they revere it (and fear it) they are just anti-you (me) being in the 'gold club'
I hope I didn't come across as any form of approval of George Soros and any tactics that were used in dollar hegemony wars, as that is certainly not the case. Free markets can be used as punishment for govt folly in a just manner, but there are certainly acts of piracy that abuse free market systems as well. Am well aware of the enslavement of entire countries via current fiat system. Let me state categorically: what govts are doing with the gold market is pure folly and will be proven so sooner or later.
Looks like Hydrocarbon Man is having more trouble than he can handle.
Go East Young Energy Problem!
PHOENIX, Jan. 25 /PRNewswire/ -- Phelps Dodge Corporation (NYSE: PD) today announced that it will notify all 2,350 employees of its Chino and Tyrone, N.M., and Sierrita, Ariz., operations of the possibility of production curtailments. The company attributes high energy-related costs as the primary threat to continuing production at the New Mexico facilities, and a combination of low molybdenum prices and high energy costs as the reason for notification of Sierrita employees.
Phelps Dodge Chairman, President and CEO J. Steven Whisler, said: "The electricity crisis in California, and its impact on energy prices, had a significant impact on our fourth quarter 2000 results, with our U.S. electricity, diesel fuel and natural gas costs 65 percent higher than in the fourth quarter of 1999. Our Chino, Tyrone and Sierrita operations are the most energy-cost sensitive in the Phelps Dodge portfolio. After a review of the near-term market outlook for energy prices and a thorough analysis of the molybdenum market, we believe it necessary to notify our employees that we may not be able to maintain production cost-effectively at the Chino, Tyrone or Sierrita operations. The situation remains fluid and we have not reached final decisions about curtailments at any of these facilities.
"Until the California power crisis is resolved its negative impact on industrial facilities in surrounding states, including our New Mexico and Arizona operations, will be huge in terms of additional plant closings and employee layoffs. In the meantime, Phelps Dodge will continue to work aggressively, diligently and creatively to pursue every opportunity to minimize the impact of these extraordinary circumstances on our businesses and our employees."
Employees will receive Worker Adjustment and Retraining Notification (WARN) Act letters by mail this week advising them that temporary production curtailments could become effective following a legally required, 60-day notification period. The unions which represent some of the employees at Chino also will receive WARN Act notices this week.
The company will closely monitor the energy and molybdenum markets throughout the 60-day period to determine whether curtailment actions may be necessary at any of the three facilities. No details about possible production curtailments will be provided unless final decisions to curtail production have been made by the company.
In 2000, Chino Mines Company produced 271 million pounds of copper through its workforce of about 990 people. Copper production at Phelps Dodge Tyrone, Inc. was 159 million pounds in 2000; the operation employs a full-time workforce of nearly 620 people. Phelps Dodge Sierrita, Inc. produced 245 million pounds of copper and 22 million pounds of molybdenum in 2000, and employs approximately 740 full-time employees.
Phelps Dodge Corporation is the world's second largest producer of copper. The company also is the world's largest producer of continuous-cast copper rod and molybdenum, and is among the largest producers of carbon black and magnet wire. Phelps Dodge has operations and investments in mines and manufacturing facilities in 27 countries and employs approximately 15,500 people worldwide.
Committee of 300@ThaiGold, am i on the right track, Sir?
http://www.infovlad.net/library/committee_300/com305.htm"It took a lot of research on my part to link the price of gold to the price of opium. I used to tell anyone who would listen, "If you want to know the price of gold find out what the price of a pound or a kilo of opium is in Hong Kong." To my critics I answered, "Take a look at what happened in 1977, a critical year for gold." The Bank of China shocked the gold pundits, and those clever forecasters who are to be found in great numbers in America, by suddenly and without warning, dumping 80 tons of gold on the market."
"That depressed the price of gold in a big hurry. All the experts could say was, "We never knew China had that much gold where could it have come from?" It came from the gold which is paid to China in the Hong Kong Gold Market for large purchases of opium. The current policy of the Chinese government toward England is the same as it was in the 18th and 19th centuries. The Chinese economy, tied to the economy of Hong Kong--and I don't mean television sets, textiles, radios, watches, pirated cassette and video tapes--I mean opium/heroin--would take a terrible beating if it were not for the opium trade it shares with Britain. The BEIC is gone but the descendants of the Council of 300 linger on in the membership of the Committee of 300.
The oldest of the oligarchical British families who were leaders in the opium trade for the past 200 years are still in it today. Take the Mathesons, for instance. This "noble" family is one of the pillars of the opium trade. When things looked a bit shaky a few years ago, the Mathesons stepped in and gave China a loan of $300 million for real estate investment. Actually it was billed as a "joint venture between the People's Republic of China and the Matheson Bank." When researching India Office papers of the 1700's I came across the name of Matheson, and it kept on cropping up everywhere--London, Peking, Dubai, Hong Kong, wherever heroin and opium are mentioned."
Your post......
REVELATION (01/24/01; 22:01:59MT - usagold.com msg#: 46386)
TO poster : SIMPLY ME
You are then hoping for hyperinflation just what
everyone needs. You should read Peter Bernsteins
book " THE POWER OF GOLD".......
My response........
Do you base all your investing decisions on one book? No wonder you're in trouble. I'm not hoping for hyperinflation, but it's not hard to forcast a downturn in the economy when you look around at the world right now. For instance, look at the energy crunch you're experiencing right now. It's spreading...Texas, Colorado, who's next? Are you old enough to remember what an energy crunch did to the US economy in the 70's? Yes, we have Greenspan still trying to engineer that soft landing instead of Volker tightening the noose. But soft landing or not, it's still going to be a landing. And if Greenspan cuts rates another 1/2 percent this month, I'd start looking for that on-coming train that he's signalling.
Another post of yours.....
REVELATION (01/24/01; 21:41:22MT - usagold.com msg#: 46383)
R. POWELL
Yes, in 9/99 I made close to $80,000 on gold stocks sold
them and bought back in. Now look at it. It's pathetic, and
the market won't budge an inch...........
In the last 3 weeks fortunes have been made just buying some well known stocks...............
Also being eyeing LOR stock in the last week and almost sold my gold stocks to buy into it. Well sir that stock has almost doubled since and the fact remains Gold is losing big. Gold is sitting at all time lows and can't even stage a small rally.
My reaction......
Well, there's your problem! You're placing bets on a crooked shell game! Since 1998 picking stocks has been like trying to pick the shell the pea is under. And gold stocks are just one of the shells. Buy some physical gold and grab the pea this time instead of just betting on the shell.
"The BIS operates on gangster lines. If a country will not submit to asset-stripping by the IMF, then it says in effect, "Right, then we will break you by means of the huge cache of narco-dollars we are holding." It is easy to understand why gold was demonetized and substituted with the paper "dollar" as the world's reserve currency. It is not as easy to blackmail a country holding gold reserves as it is one having its reserves in paper dollars."
" It is well enough that the people of the nation do not understand the banking and monetary system for, if they did, I believe there would be a revolution before tomorrow morning"
(Henry Ford)
It was Disraeli , I believe,� Britains only Jewish prime minister that had said, in the previous century, the same thing about governments.
The �system� as operated by the �establishment� which includes the monetary system, and government, has only been able to exist because the vast majority of people either don't know, don't care to know, don't believe when they are told, or don't want to believe.
This state of affairs has existed since the first, and only true form of democracy established in Athens, many centuries ago, collapsed. And, even in those days, if you spoke out against the establishment from a position that carried an air of authority, you were invited to a hemlock tasting � your first, and last.
Revelation (and how many others) has certainly been influenced by Bernstein's book, which shows you the power of the printed word. As Napoleon once said (that man said so many things, in French of course)), "I would rather face ten thousand bayonets than a writer's pen.
This is why you will NEVER, repeat, NEVER, see the truth in published book form. You would never get a printer who would dare print it. And, any writer who knew the truth would not risk his neck trying to get it published.
( Let me inject here, that it is far too complex an issue to know the full truth, and would take too long to tell so that people could understand and comprehend, if you did)
This is why I have tried to get across that it is sufficient to know all is not what we are led to believe, and that we can really do nothing about it. There is no KNOWN cure,
unless you could carry out mass hypnosis treatment on mankind and change human nature. completely.
So, take Mr Bernstein's main theme with a pinch of salt. As Randy says, those with a particular agenda have probably backed him to write it. This is true, also, of most of these so-called �expose� writers.
Do you think you could find a book, which told you the full truth of the Though, a number of books on the bookshelves purport to do so. No way, even those on the many lower echelons of this secret society don't know what goes on in the all-high echelon. They think they do, they believe they do, just as we �think� we know, and many on the lower rung of the political ladder, think they know, what really goes on in the upper echelons of government.
Remember, that it is the excellent job of the network that is in place to keep us perplexed, confused, and in the dark, that it exists, and has existed through time. Do you think �spin� is a political device of the 20th or 21st century?
One thing, I will leave you with in this posting. �TPTB� are NOT anti gold. Quite the opposite. They understand it, and revere it far more than you or I. And as Shakespeare said -� ai, and that's the rub�. Once again everyone - �THEY� ARE NOT ANTI-GOLD. (hope that sinks in) THEY ARE JUST ANTI-YOU (AND ME) BEING IN THE �GOLD CLUB�.
All you need to join is own some of that precious (even at these prices)metal. Want to move up the ladder? Own some more. Don't worry they will never let you buy enough to join the exalted masters - unless you qualify with other criteria.
Footnote
It is said that gold will only regain its lustre (though it never really loses it) if there was a world economic disaster of very serious proportions.
Without, hopefully, sounding too pessimistic, every day brings the possibility nearer to a probability.
Like the Titanic continued to head for the iceberg after evasive action had been taken, so the evasive measures like interest rate, and tax reductions take time to work through the economy.
Remember, it was not a head on collision with the iceberg that sank the 'unsinkable', just a glancing blow to the side.
SORRY BUT A VERY IMPORTANT WORD WAS SOMEHOW OMITTED FROM THE PREVIOUS POSTING
The power of the written word, and other musings
" It is well enough that the people of the nation do not understand the banking and monetary system for, if they did, I believe there would be a revolution before tomorrow morning"
(Henry Ford)
It was Disraeli , I believe,� Britains only Jewish prime minister that had said, in the previous century, the same thing about governments.
The �system� as operated by the �establishment� which includes the monetary system, and government, has only been able to exist because the vast majority of people either don't know, don't care to know, don't believe when they are told, or don't want to believe.
This state of affairs has existed since the first, and only true form of democracy established in Athens, many centuries ago, collapsed. And, even in those days, if you spoke out against the establishment from a position that carried an air of authority, you were invited to a hemlock tasting � your first, and last.
Revelation (and how many others) has certainly been influenced by Bernstein's book, which shows you the power of the printed word. As Napoleon once said (that man said so many things, in French of course)), "I would rather face ten thousand bayonets than a writer's pen.
This is why you will NEVER, repeat, NEVER, see the truth in published book form. You would never get a printer who would dare print it. And, any writer who knew the truth would not risk his neck trying to get it published. (though one or two have tried and met premature deaths).
( Let me inject here, that it is far too complex an issue to know the full truth, and would take too long to tell so that people could understand and comprehend, if you did)
This is why I have tried to get across that it is sufficient to know all is not what we are led to believe, and that we can really do nothing about it. There is no KNOWN cure,
unless you could carry out mass hypnosis treatment on mankind and change human nature. completely.
So, take Mr Bernstein's main theme with a pinch of salt. As Randy says, those with a particular agenda have probably backed him to write it. This is true, also, of most of these so-called �expose� writers.
Do you think you could find a book, which told you the full truth of the Masons, though, a number of books on the bookshelves purport to do so? No way, even those on the many lower echelons of this secret society don't know what goes on in the all-high echelon. They think they do, they believe they do, just as we �think� we know, and many on the lower rung of the political ladder, think they know, what really goes on in the upper echelons of government.
Remember, that it is the excellent job of the network that is in place to keep us perplexed, confused, and in the dark, that it exists, and has existed through time. Do you think �spin� is a political device of the 20th or 21st century?
One thing, I will leave you with in this posting. �TPTB� are NOT anti gold. Quite the opposite. They understand it, and revere it far more than you or I. And as Shakespeare said -� ai, and that's the rub�. Once again everyone - �THEY� ARE NOT ANTI-GOLD. (hope that sinks in) THEY ARE JUST ANTI-YOU (AND ME) BEING IN THE �GOLD CLUB�.
All you need to join is own some of that precious (even at these prices)metal. Want to move up the ladder? Own some more. Don't worry they will never let you buy enough to join the exalted masters - unless you qualify with other criteria.
Footnote
It is said that gold will only regain its lustre (though it never really loses it) if there was a world economic disaster of very serious proportions.
Without, hopefully, sounding too pessimistic, every day brings the possibility nearer to a probability.
Like the Titanic continued to head for the iceberg after evasive action had been taken, so the evasive measures like interest rate, and tax reductions take time to work through the economy.
Remember, it was not a head on collision with the iceberg that sank the 'unsinkable', just a glancing blow to the side.
Thank you for your replies. What I thought was a sure
thing became my worst nightmare. Just my opinion but
anyone considering investing in GOLD should be very
cautious not to over extend themselves more than 20%
of their net worth. I feel gold will eventually take off but
between now and then things could be very ugly for
gold investors especially with mining stocks. Thats why
I wish my portfolio was all physical gold. I am not so sure
mining stocks will be there to take advantage of a gold
bull market when it finally does come into play. So anyone
out there be careful and don't over play gold investments.
No one knows the hour or day gold goes up and between
now and then you could get taken out of the market. Loss
of job, income etc. anything can happen between now
and then. Although a rally seems emanate very soon it
might be an opportunity to sell into or especially unload
mining stocks and buy physical. FOA's senerio of paper
gold maybe crushed is very real and I believe he knows
the trail very well. I am in the same camp as FOA "This
new gold market is not as before". The powers will do
everything possible to crush the gold bulls and physical
gold is key I believe and lots of staying power. IMHO
Gold quietly warmed its engine on the tarmac this morning while the financial world awaited Congressional testimony
from Alan Greenspan today and the rate setting Fed Open Market Committee meeting early next week. In a surprise, Greenspan hinted yesterday that he would look favorably upon the Bush tax cut proposition. Wall Street is hoping for some icing on the cake in the form of a rate cut early on top of the tax cut. Whether or not Gradualist Greenspan will move as quickly as Wall Street would like remains to be seen.
On the one hand Fed policy will be pushed by the growing
worldwide energy crisis (which calls for lowering interest
rates). On the other, it must be mindful the inflationary push resulting from that very same energy crisis. Mr. Greenspan, pole in hand, steps out once again on the tightrope with all the world watching.
Gold continued to act in a subdued fashion in Asia due to the Lunar New Year holidays and Europe was quiet with UBS/Warburg reporting one large European investment bank a major buyer. The quiet mode carried over to New York though we did open higher. The stronger dollar has also acted against gold in the short term. We could see some changes in the gold trend today and tomorrow as the gold market assesses Mr. Greenspan's remarks and prepares for Asia's return on Monday.
Some will see Greenspan's acquiescence to the Bush administration on tax cuts as inflationary and thus bullish for gold in the medium to long term. Already we have seen massive money creation from the Fed over the past several months. Combining tax cuts and rate cuts could become an inflationary quicklime. Throw a little water on the volatile mixture in the form of an international energy crisis and the whole thing could explode in flames.
I would caution gold owners and would be gold owners not to
dismiss the California crisis as just another, run of the mill, press generated scare. There are deep systemic risks involved here that are not likely to disappear with the wave of the hand. In California, you have right in the United States the sorts of problems that will be occurring all over the globe as energy costs ratchet up inexorably. I read this morning the reports of San Antonio families (Thanks Black Blade at the Forum) demonstrating before city hall. They are faced in some cases with a quadrupling of their utility bills and have to make a decision between eating and paying their gas bill. What we need to understand is that as energy costs escalate this sort of thing is going on all over the world, not just in San Antonio.
For nation states, particularly heavily indebted third world
countries, the choice takes on a different twist. They will be deciding whether they should pay their energy bills or principle and interest on their debts to the international banks. That's how the energy crisis becomes a systemic crisis. (And President Bush has already hinted that a bailout of California is not in the cards. One would have to assume that philosophical position is aimed at the banking sector.)
We are often in the vanguard here trumpeting the call, and we would caution all that the deepening energy crisis is real, the risks to the system are real, and gold ownership remains the most viable defense against those systemic risks. One wonders if Mr. Greenspan will address these problems in his testimony today. More tomorrow if warranted, but on that somber note this could be it for the week. This might be a good weekend to mull this over. Those in California and the West are already beginning to sense that this isn't your run of the mill crisis. As the facts come out, we may find the problem runs deep and well beyond the confines of the California border in all directions. MK
I do agree with your analysis "simply me" in favor of
physical gold. But remember you can't pay your bills with it
and it's only for insurance. When in need of cash because
of job loss or loss of income for your everyday needs and
you have not built up a good war chest to weather the
storm many goldbugs will be selling their gold I'm afraid
at fire sale prices before gold takes off. So it's important
to remember gold may not take off only at a bottom of an
economic contraction thats so severe leaving us goldbugs
broke only to sell our gold. I hope that is not the case
but it is a real possiblity.
"Panda gold" and the Titanic what makes us so sure we
will escape the carnage with gold. The way things are going I don't put alot of my faith in gold right now. If things
get bad enough gold could drop and then what. The one
thing positive for gold right now is a possible small rally
and then it may keep going down with bad economic
conditions. Like I have said the explosion in the price of
gold might be delayed much longer than we are willing to admit. Like me and others have made big bets on gold and lost. Well, not lost yet because I haven't sold but in todays
markets it's very ugly. Gold still has not proved itself as a
good hedge but I hope like others soon. But I found hoping
and wishing for better days is endless. Today we are worse
off than anytime in history as gold investors. Do I have to
say more.
I have invested in and observed the gold market since around 1985. I agree 110% with the person that posts as REVELATION.
In finance there exists a real principle known as "the opportunity cost of money". In short what that means is while your money is tied up in an investment today what is it costing in future dollars.
At this stage even if gold were to mount a significant bull market I more than likely will lose big time with my gold stock & physical gold.
The opportunity lost because of this investment is staggering. I have missed so many opportunities since investing in the gold market that I have basically written off my gold investments and started anew.
Where money is made is in assets that fluctuate in value over time. That's it.
Filling your time with witty posts on USAGOLD or getting philosophical or religious about this market or any other market isn't going to make you a dime.
You would make more money driving a truck for minimum wage.
For the record I see gold going to $190 - $210 an ounce and not before the end of 2003.
But look at the bright side, you will all be expert at waxing and waning about the gold market.
One question: is this mysterious character ANOTHER or FRIEND of ANOTHER the owner of this website?
*****
"As far as we can judge, we have had a very
dramatic slowing down and indeed we are
probably very close to zero at this particular
moment," Greenspan told the Senate Budget Committee
when asked if the U.S. economy is in a recession.
Further, Greenspan said inflation pressures
were "exceptionally well contained."
*****
The EMP round will be fired in the standard way, but as it approaches its destination, a small explosive charge will jettison its protective jacket. Aerials will then spring out and the pulse package will squirt out a burst of radiation, enough to fry unprotected electronic systems in its footprint. This burst will last fractions of a second and after that the shell too is dead. Underneath, the opposition's radios, weapon guidance systems, computers, mobile phones, power grid and TV stations will be nothing more than scrap silicon, leaving them unable to co-ordinate military or civilian activity.
So if you have digital debt, it might be wiped out...
Though, if all you have is digital wealth, including digital promises of PMs, that might be lost also.
You wrote: "One question: is this mysterious character ANOTHER or FRIEND of ANOTHER the owner of this website?"END
In all honesty, I'm sure all of us have at one time or Another wondered about this, partly because that's the way a healthy and discerning mind thinks. The answer is emphatically NO! The surgery was totally successful and they are now 3 separate individuals.
Would you be so kind as to give a clue about where you currently believe money should be invested/saved? I am a bit surprised that so much thought and attention is payed to the few that leave after being burned. People come, people go, there are many roads to success/failure. Are we so insecure about our market that we have to justify it so mightily? Looks like capitulation to this dolt and would like to see much more of it. Who wouldn't like to go back to 1992 and take current knowledge with them? That's the opportunity I see just ahead. Many lessons were learned the hard way and want another chance to "play it again". It is all just CYCLES and the emotions that go alongside are quite predictable, especially at the extremes.
Gotta admire your fortitude in naming yourself grasshopper. Best to you.
Stranger, Randy; Comments? Intel's Idea to Spur
Demand: Big Price Cuts
By Caroline Humer
Senior Writer
1/25/01 1:12 PM ET
Semiconductor companies preparing for a rough first half of the
year, and an uncertain second half, now have something new to
factor in. Giant microprocessor maker Intel (INTC:Nasdaq) is
gearing up to lower prices on its Pentium 4, Pentium III and Celeron
chips more than analysts were expecting.
Wall Street is bracing for Intel to lower
prices on chips by more than 40% this
weekend, as the chipmaker tries to cut
prices enough to stimulate demand. Most
of Intel's chips go into personal
computers, so the lower the chip price, the
less the computer makers charge for the
final product. In turn, the fewer dollars
consumers have to shell out, the more
likely they'll be to pull out their
checkbooks. Lately consumers --
including the ones in charge of technology
spending at large companies -- have been keeping their hands in
their pockets when it comes to PCs.
Lowering prices itself isn't unusual in the chip world. Intel and other
chipmakers cut prices on a regular basis as the technology
improves and they introduce faster, smaller products. And any price
cuts that Intel makes this weekend already are factored into the
company's financial guidance -- Intel said during its Jan. 16
conference call to expect revenue to fall about 15% in the first
quarter from the fourth quarter.
Whether these price cuts are deep enough to spur demand or
retain market share may depend on how competitor Advanced
Micro Devices (AMD:NYSE) reacts.
"We'll have to see if pricing in general just gets a lot more
aggressive going forward between AMD and Intel. Right now there
hasn't been a price war, but it doesn't mean that going forward one
may not end up developing, especially as both are trying to get their
fair share of a market that's not growing all that rapidly right now,"
says Dan Niles, an analyst at Lehman Brothers, which hasn't done
any underwriting for either company.
An Intel spokesman declined to comment on the price cuts, which
were first reported by CNet. Intel price changes typically go into
effect on Sunday.
The outlook for chip growth in 2001 has been lowered several times
in the last few months and is now anywhere from 7% to 15%. Intel
and other chip companies have declined to forecast 2001 revenue,
citing the uncertain economic climate and already too-high
inventories along the supply chain.
At the same time, AMD is trying to take on some markets that Intel
has dominated, such as the corporate market. It also has
introduced so-called value chips, or chips that are both faster and
cheaper than Intel's. For instance, AMD's top of the line Duron
850-megahertz chip lists for $149. Intel's 766-megahertz Celeron
value chip lists for $155. AMD last lowered prices on Jan. 8, while
Intel's most recent official cut occurred on Dec. 10.
An AMD spokeswoman said the company's pricing depends on
market conditions.
Among the biggest cuts Lehman expects is in Intel's two
top-of-the-line chips. For instance, the 1-gigahertz Pentium III is
being slashed to $270 from $465, and the 1.5-gigahertz Pentium 4
is headed to $650 from $819. AMD's top-of-the-line 1.2-gigahertz
Athlon goes for $363.
Mr.Kosares,thank you for posting your daily commentary today on the general forum.I always value your thoughts on the present conditions and your insights into the future.
As touched upon many times here at the forum,the California situation is probably a prototype,dry run or a prelude to the big show.It is very interesting watching the various players act out their roles in a suddenly hot issue that has been festering in the background for years(sounds familiar).Who will act responsibly and with authority for the greater good of all conflicting interests?On who's doorstep will the blame be laid?Lastly, who is going to end up "holding the bag"?
If and when the virtual Hoover Dam(sticking with the electricity theme)of worldwide perception of the dollar's strength and lasting value breaks and the dollar debt obligations burst forth,today's energy crisis may give us clues to actions taken in the next sudden and unexpected crisis.
Grasshopper--- I will speak for myself as the others who frequent this forum may not agree. I hold Gold not as an investment that I use to create more wealth but to preserve my wealth. In the end all the profits that you have made in your investments must be held in paper form of some kind, stock,bonds, motgages, currency, ect.None of these kinds of asset preservation can survive the coming dollar crash without losing all or much of their value. I suggest you read on and the one place you can find the answers is in this forum. As for FOA, Another, Trail Guide they need no defense as the truth is coming out as they have predicted. White Hills
Do yourself a favor and sell all your physical gold now. If you honestly see the POG falling to $190 after 2003, sell now. Pursuing a course contrary to ones head and heart only serves to rob oneself of sleep and purpose. History always repeats itself because of the stupidity and vanity of man, that we can always count upon. Gold deflation in respect to fiat currency has never been borne out by history. NEVER. History shows the worst scenario to be lived through will be a flat performance that serves to insure ones wealth, while buying time for the paper fraud to end.
For those banking on GOLD including myself if GOLD
doesn't move soon then I think gold investors are doomed
for huge losses unless the dollar falls apart. So far the
glue is holding up very well and golds future is nil at
this point. With the economy slowing energy will be
less and less used. Sorry, but I'm beginning to feel
like gold investors are "had". If gold can't stage a rally
soon I'm afraid the golden goose is going to leave us
high and dry. Use what ever senerios and bullish arguments
you like but gold is sitting there and trending down. Very sad indeed for us goldbugs. With gold not responding
to anything with the word crisis attached to it is extremely
bearish. We need to wait a few more weeks and then
we might know if gold is going to lay down and die.
So far it's a huge disappointment and GATA has no
effect at all on gold. Greenspan must be rolling over laughing in his chair. Proclaiming lawsuit belongs
with episodes like the 3 stooges. GATA has proved
that only one thing but to take donations and while
we in the wings watch gold go down in the face of
bullish statements coming from GATA for 2 years now.
Who's kidding who !!!! Believe me Greenspan will keep
on laughing while goldbugs suffer. They have the gold
and they make the rules for now. Lets hope our day comes
but it looks very dismal. Don't bank on it.
You wrote "Yes, in 9/99 I made close to $80,000 on gold stocks sold them and bought back in. Now look at it. It's pathetic, and the market won't budge an inch.........." Permit me to translate from complainese to acu-speak. "the market won't budge" becomes, "there is a dearth of "bigger fools."
Every dollar gained by wealth transfer must be put into the gainer's account by someone else. There is no �Great cash-in desk up in the sky' where one can tender their paper investments for reimbursement. So, you are actually saying "It's pathetic" that no-one will give you some unearned purchasing power when you are wishing for it.
For every dime won there must be a contributor who may or may not be subsequently contributed too. Ergo, for the game to function there must be both winners and losers. Put in terms of the punch line to an ancient joke about the absence of women in the Klondike: "it was your turn in the barrel."
Why everyone is hoping for a reccesion to move gold is
beyond me becuase demand would fall off and so
goes the price of gold possibly. This is not carved out in
stone but I think Steve knows more than we do. Panda
Gold on this forum states that the USA titanic sinks into economic turmoil GOLD will be our life rafts. Maybe or
maybe not but one thing is clear GOLD can't rally for
anything.
-BOE:last auction in march
-FOA:said watch them,when they stop their sales
-China:opens new physical Gold market in JUNE or so
-Goldshares:show accumulation
-Greenspan:officially admitted hard landing (going from 7% growth to 0% IS a hard landing)
-Dollar:back on the same level (<92euros) which brought us this hard landing
-Interest rates:going down fast in the US ,the premium to the euro rates (carry trades...)are evaporating
-inflation:you know it...
We might be closer than we never thought to have to admit.Somehow I still feel unprepared.
Buy Gold NOW,the papergold might go UP in smoke,who knows.But buy before all PHYSICAL GOLD.
I don't know how many of you watched Nightline with Ted Koppel last night. The featured story was (again) the power crisis in California. So far it was the best television discussion of how this whole mess got started, where it stands now, and the possible outcome. In summary, there appears to be three or more disparate events which have come together at this time to form a "perfect storm." The consumer price structure was capped because one year ago California actually had a surplus of energy and lawmakers wanted to introduce competition at the wholesale level among the power generators. So the solution was to deregulate the wholesale market and for the utilities not to lock in long-term energy contracts. Secondly, the utilities sold off their power generation equipment to garner profits to make the bottom line look better. (Now who would have given them this advice? Maybe the New Yorkers a la Goldman Sachs?) Add to that the environmentalists who firstly restricted the building of new power plants and secondly got the existing plants to switch to natural gas. Now stir into the equation the increase in demand due to the computer revolution and every other electronic gizmo gadget and the previous surplus of energy turns into a deficit. Finally, the coup de grace is the tripling of natural gas prices in a scant five to six months and there you have it: a perfect energy crisis.
Some people have intimated that such events did not just sneak up on California, and that people in the know took advantage of the situation. Rebuke has been hurled at Wall Streeters who goosed the price of natural gas through options and futures to the Texas-based middlemen who held back supply from the market to force prices higher. All of this has not been lost on the elites now in office.
The final thought of Nightline was that California will run out of time and options in the next 10-14 days. That is when the utilities will "hit the wall." Interesting how President Bush has stood aloof from the whole mess. My guess is that there is some type of federal bailout in the works which will be presented at the last minute. After all, California's economy is about 25-30% of the entire U.S. economy and, if standing on its own, about the sixth largest economy in the world. My best guess: There will be a federal order for utilities west of the Mississippi to sell their surplus energy to California with payment to be guaranteed by a federal program (bond issuance, etc.). This appears to be the only workable solution because it takes years to build power plants. This solution will probably keep things together until summertime when electricity usage jumps dramatically. July appears to be the critical month in all discussions. So if you are headed to Disneyland, better get there before July's heatwave curtails your plans.
Thank you, but I think you failed to see my point.
Anything with the word GOLD attached to it has
lost big. I can give you several examples of missed
opportunities in real estate, bargains on certain stocks
and even in my own business due to foolishness in
gold investments. Yes, buy gold but keep it a small percentage of your assets. Thats a fact and you ?
I'm speaking from the real world of investing not someone
who is pretending to know. All I'm trying to so is warn those who have not yet become victims.
And accumulation of companies pioneering the Powerchip industry which will reengineer electricity generation, storage and distribution. see www.powerscom.com.
All a better bet than owning gold.
Investing is as much timing as it is choosing the correct vehicle.
I have developed my "consumer real inflation" or CRI index. I will have my "core rate" which excludes the non-volatile fixed mortgage and car payment. Here are the components and the rate of inflation I have occurred year over year:
Food +8% (higher if you eat out more often )
Heating fuel +100%
vehicle fuel +50%
electric bill +40%
homeowner insur. +10%
health insur. +35%
phone unc
after weighting each category according to % of total budget I have arrived at a core rate of 43 % annual. This should be the index used to accurately reflect reality. Anybody claiming inflation is "benign" is either smoking their socks or only buying Taiwan toys and trinkets. Anybody else want to submit their "CRI" ?
WASHINGTON (AP) - Americans' wages and benefits rose
solidly in the fourth quarter, wrapping up a year that posted the
biggest annual gain in compensation costs since 1991.
The Labor Department reported Thursday that its employment
cost index, a closely watched gauge of inflation, rose a
seasonally adjusted 0.8 percent in the last three months of 2000,
down from a 0.9 percent rise in the third quarter. That reflected
a job market that cooled late in the year from its earlier red-hot
state.
A second report Thursday showed that sales of existing homes
slipped by 7.4 percent in December to an annual rate of 4.87
million units, one of a series of reports showing how the
economy has weakened sharply in the past two months.
Federal Reserve Chairman Alan Greenspan told Thursday that
"as far as we can judge, we have had a very dramatic slowing
down. We are probably very close to zero (growth) at this
particular moment" in the first quarter.
Greenspan's comments were viewed as a further signal that the
Fed, which announced a surprise half-point cut in interest rates
Jan. 3, is prepared to lower rates further when it meets next
week to make sure the country does not slip into a recession.
Many economists expected fourth-quarter compensation costs to
register a 1.1 percent gain.
The wages and salaries component of the index, viewed by
economists as the best measure of changes in workers'
compensation costs, advanced by 0.7 percent in the fourth
quarter, compared with a 0.8 percent rise in the third quarter.
The cost of benefits, such as health insurance, vacations and
other perks, also moderated in the fourth quarter, rising 0.8
percent, compared with a 1.0 percent increase in the third
quarter.
For the 12 months ending December, Americans' wages and
benefits grew by 4.1 percent, the biggest increase since a 4.3
percent rise in 1991. Benefit costs led the way. Labor costs rose
last year as employers scrambling to find qualified workers
during much of the year, wooed them with higher wages and
benefits.
Last year, consumer prices as measured by the Consumer Price
Index rose 3.4 percent, suggesting that workers are posting gains
in compensation even as they pay more for higher-priced energy
products and other items.
While gains in wages and benefits are good for workers,
economists and members of the Federal Reserve watch them
closely to make sure they don't become inflationary. That was a
prime concern when the Fed was raising short-term interest
rates between June 1999 and May of 2000.
Now the Fed is worried that those rate increases may have
slowed the economy too much. Earlier this month, the Fed
unexpectedly cut interest rates by a half percentage point in an
effort to prevent the weakening economy from slipping into a
recession. Additional rate cuts are expected.
At the end of the year, there was a spate of troubling economic
news - weak manufacturing activity, low consumer confidence
low, disappointing holiday sales and slower job growth.
In December, the government reported that private payrolls
edged up by just 49,000 during the month, ending a quarter in
which monthly job creation in the private sector averaged just
84,000, the poorest showing since 1992 and just half the rate in
the first nine months of the year.
In another report, the number of Americans filing new claims for
state unemployment insurance rose last week by a seasonally
adjusted 12,000 to 316,000, suggesting that employers demand
for workers waned a bit. The increase came after a big drop in
claims - by 40,000 - the week prior.
The more stable four-week moving average of claims fell last
week to 336,000, the lowest point since Nov. 18, 2000, when
claims were at 331,250.
For the week ending Jan. 13, 37 states and territories reported
increases in jobless claims, while 16 reported decreases. The
state data lag a week behind the national figures and is not
seasonally adjusted.
California reported the biggest increase in claims, up by 11,850.
Officials blamed the rise on layoffs in the trade, service and
agriculture industries.
http://www.goldensextant.com/commentary16.html#anchor10789 In the link above, Donald Lindley, Reg Howe's number cruncher buddy, has put together a marvelous picture of coordination between bullion bankers and the BOE on the issue of gold sales. Bankers sell time premiums, that portion of a futures or futures option contract that is sure to dissipate with time, and hedge actively in the market with the purchase of bullion (no time premium) and buy backs of the same metal contracts they had previously sold. Hedging does not always work, that is when the market is not changing values smoothly but in big steps, the Black-Scholes theory is missing one of its three main legs. Step wise moves in prices make delta hedging impossible. At these points, rather than hedge, the bankers must go to a "lender of last resort", a policy maker, that would supply credit and guarantees to allow a flooding of the markets with calls or futures, supply gold, and "talk down the market", make statements that would help lower prices.
In the chart, the BOE acquiescence in this action is made clear as gold related announcements are made to scare gold and paper gold buyers from the markets just before options expiration, when the bankers would have to pay the cash to speculators who bet against them. Some had actually moved to cash in their paper gold for the real thing. Those had to be accommodated by "someone" (a.k.a. BOE and weak willed central bankers elsewhere) to lend or sell that gold.
I have pointed out that the "Washington Agreement" had a guarantee to supply a particular quantity of gold � namely the amounts that the EU signatories had on deposit with the NY Fed (i.e. that portion that the US could grab, giving payment at an arbitrary dollar value). The gold deposited there in WWII would obviously have increased later had the US been thought to be a good fiduciary for it. The fact that the gold stores only receded, indicates that the US has not been exercising its duties as fiduciary to it, and has used this gold as its own. I like to call it "hostage gold". Black gold or not, I believe the London Gold Pool and subsequent operations anti gold operations not revealed as of yet, were using the gold � selling it to its owners. This is sort of like a store receipt being provided in return for the return of the merchandise you already paid for but only after the store had doubled prices on everything, so that in order to get the same item in the right size, you have to pay for it again.
Back to the chart.
In summer 99, gold prices are at $255-260 after the BOE comes out with 3 announcements regarding its sale of half its gold reserves and widespread fear in the gold markets that others will follow. However, buyers are coming in like crazy, buying bullion � not paper. As a result, a shortage of spot deliverable gold forms and premiums on coins join lease rates in escalating to values not seen in the recent past. Miners and hedge funds buy paper gold (futures and calls) from the banks in order to protect themselves from their short positions. Open interest on COMEX alone grows to 700,000 call and futures contracts � 70 million ounces or 2000 tonnes � COMEX is just a spec on the bullion and paper gold trading world, with OTC contracts traded privately and on London's LBMA filling in the rest being at least 10 times larger.
News of gold digging expeditions to central banks around the globe resound as gold prices remain low, but the cost of keeping them at that level (lease rates and premiums on physical) are prohibitive. The paper market had completely lost its contango, yet the bankers continued selling paper � particularly calls. Leading to the pre-Washington Agreement peak of 2000 tonnes sold on COMEX. The buildup included the sale to the public of 500 tonnes of calls at a short term strike of $260 to $270 and long term strike average of $290 in the two months prior to the agreement. Obviously, the Washington Agreement was intended by the bullion bankers to increase credibility of their claim that gold will be forthcoming, since its major market moving significance was supposed to be the assured sale of 2000 tonnes, and the commitment by the EU banks not to withdraw their gold from the market. The law of unintended consequences came into effect, and the whole deal misfired as the markets perceived that the quantities would be woefully inadequate. The price shot up.
Rather than just hedge their positions, the bankers brazenly showed up on the market with more calls, selling another 100,000 contracts � nearly another 300 tonnes. They sold till prices hit $290 just before expiration. Why $290, because physical gold holders had purchased puts in order to take profits in their metal holdings � 75,000 put contracts were sold � close to the call sales figure from that same period � 100,000 longs, 75,000 shorts purchased. On the futures side, the amounts came out to a minor drop in open interest as the public longs were offset with public shorts. The puts, purchased during the price spike at an average of 300, and the calls gave a minimum payout at $290. (I have a spreadsheet to determine minimum payout figures for call and put options for stocks that works very well in predicting the price at expiration � only problem is accounting for options issued at the last minute that are not made public till the following day). Though there are many reasons to believe the markets would maneuver to approach the minimum payout point proposition, I still hold that it is primarily a result of price manipulation by options traders from banker's trading desks.
The unwinding from that point came as the Fed supplied the 400 tonnes per year for the Washington Agreement's fulfillment to the BIS gold sales system from that point on. The US export data show just that quantity � less the BOE sales.
Prices have come down since the price spike as the open interest dwindled with a gold sale announcement and/or a gold sale by the BOE preceding each options expiry when prices had risen. Furthermore, during this period, minor central banks around the world were cajoled, threatened and pushed into leasing or selling their gold. Deposit holders in major banks � particularly in Europe � reported that their bankers sold allocated metal accounts of silver and gold without authorization, and were completely unrepentant and unwilling to comply with demands for restitution and replacement. The banks are obviously expecting full support from their official sectors.
The situation continues to get hairy as the mad scramble to obtain gold in fulfillment of impossible delivery obligations is only exceeded in intensity with the loss of confidence in the gold pricing and delivery systems by investors who see no further reason to buy paper gold or to hold gold accounts.
The bearing of black gold:
By my rough reckoning of the still not quite proven black gold market, private gold deposits are being tapped � probably unbeknownst to the owners - at a rate of further thousands of tonnes per year. The withdrawal of black gold from the banking system is lowering reserves � which is what the central bank official holdings are under this scenario. I should point out that in typical bank fashion, the offer made to the Marcos group was of up to $983 billion in dollar loans payable with the gold, that quantity being discussed amounting to 62,000 tonnes. In toto, the quantities discussed in D Guyatt's documentation seem to be in excess of 1 1/4 million tonnes delivered since 1954, and possibly beginning prior to that, with deposits within the US standing at 300,000 tonnes as of 1989 (190,000 accounted). The date provided for initial contact with the banking community regarding initiation of marketing of Marcos� alleged discoveries during the martial law period was 1980 � the peak of the gold market. This would have been AFTER the bulk of the gold was deposited in banks across the continents in the period leading to the marketing initiative. The surprise is not that gold prices dropped as a result of putting such historically enormous amounts to market, the surprising issue is that the markets declined on the rumor by only 50%, and upon the "news" of the deal concluded in 1983-4 had prices go back up.
The point of the Marcos gold story is multifaceted, but regarding the market's ability to absorb gold, there is the implication that in absorbing over half a million tonnes in the period 1954 to 1971, the markets had not had enough, and the dollar was forced off the gold standard. Only upon resumption of the gold flow in 1980 was the dollar POG parabolic advance halted. The offer, as made, for 8% T-bonds redeemable in gold at a later date indicated at the then $442 price that for the privileged central banks and "VIPs", put the dollar de-facto (assuming these are facts) back onto a gold standard at a conversion rate of $442 per 20 year 8% zero coupon T bond, thus dictating a gold price of $442 * [(1 + i) / (1.08)]^20, which is about $266 at current interest rates (i). (The active bond duration for this relationship could vary over time, as would the actual currency dictating the POG � as other central banks could have made such deals). In the period since the gold sale discussions, the central banks of the world had increased their treasury holdings to $1.2 trillion, and have not added (or sold) any substantial amounts since 1997, when treasury accumulation abruptly came to a halt.
The POG in this case was to become a derivative of treasury interest rates, which slid in the period when interest rates on long bonds slid as well. This corresponds to a take-off in OTC paper gold issues volumes and the steep slide in (paper) POG, and marks the first success in the US government running a positive cash flow (if not quite positive books) since WWII. As Bill Buckler said, "they cut up America's credit card" with the central banks. Could this be because the US ran out of documented gold to back its treasury debt, which had to both be reduced from that point on and the private market had to substitute for the "missing" gold with its own issues of paper gold to back treasury paper sales? Could the interest hike by the Fed in April (?) 1997 and the simultaneous pulling of the rug from under Japanese and other Asian banks by imposition of the international capital adequacy requirements been part of the attempt to reel back the gold bonds? Could the expiration of the Washington Agreement have anything to do with the at the maturity of the first of these imaginary (or real?) bonds in 2004.
Indications from D Guyatt's documentation is that the banks of the US and other countries had lent out the gold � a purported Citi 110,000 tonne account was deemed empty of gold during a probe, and a further 7500 tonne account at Dresdner was on loan at 80%. As is the norm, banks had overleveraged, as had the government. Same old story again. 1929 in the US all over again, a repeat of pre-WWI European monetary conditions, a repeat of the founding of the BOE and the South Seas bubble to put away England's debts, a repeat of the John Law's Banque Royale and the Mississippi bubble to pay the deceased Sun King's debts from an empty treasury. Looks like the Marcos gold story has not changed the propensity of desperate governments to embrace far fetched financial schemes to cover their debts by leverage and subsequent debasement of a currency redeemable in gold to the point of breaking the promise of redeemability. With or without the Marcos gold, the picture remains the same.
Sir, you are starting to sound a lot like the old Radio Moscow propaganda machine: all sympathetic and commiserating and then spewing out the biggest load of cr*p. If you really believe what you say, then bail out now and get on with your life. But please don't try to get the rest of these good people to follow you down the drain. I wouldn't follow Kaplan to the rest room. I honestly wish you the best but you are sounding more and more like a double agent from the cabal!
Hopefully my last contribution to the saga of the emotional bee hive you've disturbed.
First let me say Revelation, I do not deride you. I know exactly how you feel, as I sure many of us at this forum do, we have been there, and go back occasionally, time and again, if we are honest.
We need the occasional member like yourself (in small doses) to make us question our beliefs, and to test them.
I know what you are seeking, you want to be convinced. You still, deep down in your heart, don't want to accept that your assessments and thoughts were wrong. I have to say that there can be no concrete assurances. The only real guarantee we get in life is that one day we will die. In other words your current thoughts could well be right.
BUT, yes a big BUT. Let me go back to the Titanic analogy.
We are on board, we have struck the iceberg and the ship is definitely sinking. There are not enough lifeboats, so what do we do? Well, most of them congregated at the stern and while the ships band played hymns, they sang, and prepared to meet their maker. They just accepted what appeared to them to be the inevitable.
Would you have joined them?
What would have been the most precious thing on board the ship at that time? Fat, lard. In those days they did not use oil for cooking, they used thick fat. I would have gone down to the kitchens and smeared myself thick with fat. Then I would have got some of the bed sheets and bound many deck chairs together, or wooden doors from the cabin wardrobes whatever, and made a raft. Then with plenty of blankets and some rum from the bar, I would have launched myself, with a prayer, into the water.
Would this guarantee I would live? No! But there was a very good chance it would, There would have been no chance if I had just stood and sung hymns.
Fat is not gold, but it was a precious commodity on such an occasion. And the other precious commodity is human ingenuity and the will to survive. These too would be needed if we have a worse case scenario.
In an economic catastrophe gold could buy the essential things needed to survive. It is not a guarantee of survival but is something that is accepted for trade world wide. Remember in the German hyperinflation people carried their millions in paper marks in baskets, and it is said people would steal the basket and leave the money. Maybe there is some poetic licence there but it illustrates a point.
I have also mentioned that it was gold that helped save the Korean economy from being a worse disaster, not Korean wan notes.
Yes, you can search for other things. I do. But I will never turn my back on gold, nor will I make it my god. Keep things in perspective, maintain balance.
Someone mentioned that China, some years ago dumped gold onto the market, to confound the system which was oppressing her no doubt. Here is a thought. There is a new and stronger China today, but she is still upset and nervous by those who wish her harm and to not succeed, because sh does not follow the way the US dictates.
She knows that should a war be threatened against her, she would, in the final analysis have little chance, militarily. But, she would go down fighting and her attacker would suffer a terrible retribution.
Her hope is that she can become stronger economically, so that her economic power would help to avoid a military conflict. Now if she caused a problem dumping gold on the market, how about if her people were encouraged to buy gold and force the price up. How about that for a threat?
One third of the world population that I understand, as yet, is barred from owning gold. But China is changing and hurriedly liberalising the laws on gold trading. She is, or has already, opened a market in Shanghai. Even the mere threat of a near billion Chinese( there are about 1.4 billion and growing) running out and buying a half ounce of gold would be alarm to any shorts.
Then there is Europe and its need to get its currency accepted. The euro is not in tangible form until January next. It looks almost certain that it will have a gold coin issued, by one, or more of the EU countries.
This would do two things. It would strengthen the Euro, and stimulate gold coin collection.
The WGC are in the process of launching a big marketing campaign to put gold on everyone's lips for jewellery and fashion.
There is much my friend to give hope. No guarantees. But I believe it is a safe bet that gold will LIVE! And in the not too distant future, we will see sins of that life.
You slammed me earlier re my remark about Rothschild. Well, I was clearly not claiming that I was, or wished to be, one of that family. My remark was to counter your remark that you have never heard of anyone becoming rich from gold. They started from poor to trading in coins, mostly gold, as that was the only real money, especially to a Jew. The banking business came from a later generation. But there are many others, even today.
True, the Jewish people have a network, that once they prove themselves as good business men, or have a good idea, gives them access to easy financing.
The biggest mistake you made, as so many of us did, was that you got the timing wrong. Gold was on a down trend for some vey specific reasons. A look at the charts even a few years ago would have shown that. This in the same way that many got their timing wrong with the Nasdaq - in fact, the stock markets in general. TTT - timing, trend, and thrust (volume).
There is a period before the tide turns when it appears to have no definite direction. It is only because we KNOW the tide always goes out again, that we are not fooled. Gold is at that point now - between ebb and flow. BELIEVE! Hold some to keep a feel for the market, but look at other options too. No one asks you to sell your soul to gold.
Footnote:
One of the biggest diamond ever found in South Africa, was found by a poor prospector. He had worked hard for years and years, but found little or nothing. He decided he would give up and prepared himelf, to the happiness of his wife, to making it the last week. On almost the last day, he hit pay dirt and came home with one of the largest diamonds ever found.
Your post reminded me of the basic, and much ignored truism that recession is what you get when business can no longer fulfill demand with the current economic structure, and thus reports lower cash flows from operations, and therefore, lower earnings, and less likelihood of paying off debt. The economy then has to restructure to bring investment away from where it was overly abundant to where it was missing.
Among the less flexible aspects of the economy is the number of workers having particular sets of skills available at any time. Another is long lead time capital investment such as that in resources and large scale energy production. Corporate America adjusted to the dearth in skilled management in the 80s by raising pay through stock options, thus putting it off the books. In the late 80s, tech companies started doing the same in order to attract top tech talent without showing investors the cost. By the early 90s, tech CEOs were already stating before congress that a change in accounting rules to force them to account for stock options at full value on the books would wipe out their reported earnings.
At the end of the 90-91 recession, tech land was still short of talent and the labor markets remained constrained. Compensation continued to grow for those with the skills of the moment. Come 1994 and the advent of a workable internet access device, the sector blew up with html software requiring a heretofore unknown and nearly non-existent set of skills. The need was so great and the labor market's offerings so slim that automated html and network operating system software became an absolute must. From nowhere it grew into a standard "built in" in office software suites and the browser turned into a part of the operating system only a couple of years since the trend onto the internet started.
Labor was so constrained that technical and management talent had to be lured away from cash paying jobs to the "new economy" from the old one. High end labor costs in the whole of the economy skyrocketed when options (alluded to by Greenspan today when pointing to the mysterious component of tax revenue that wage statistics did not seem to capture). Many of the telejobbing found themselves with a virtual paycheck that suddenly disappeared at the April drop and became a net liability in Q4 as the tax on the old options was due, but the value of the new options fell to near 0. Yet the shortage in tech labor continues and the lack of skilled management has gone down the labor ladder to hit the "warm body" grocery bagger and burger flipper.
Enter dis-energy:
The lack of investment in energy exploration and power plant construction in the US in general and in California in particular - due to environmental and local NIMBY blockages - were joined by stupid regulations on purchasing strategy and price caps and with the general preference of investors to play the technology roulette rather than invest in staid old power and energy. Suddenly, further supply was not forthcoming and prices skyrocketed NASDAQ and Dot.Com style. Costs started to shift so far as to make decisions to shut down operations very easy and obvious for some commodity producers. These shut downs will move local supply offshore, where the various bananalands at least offer steady power. But the closed down capacity in Aluminum, cement, fertilizer, steel, plastics and organic chemicals etc. will lower supplies. The people working the tech businesses and those catering to them are now needed in the energy exploration and extraction field as well as to construct new power plants. Their current employers facing high energy costs and increased labor shortages will have to let go and allow people to move to the inhospitable climates and working conditions that the resource sector requires. Wages will have to rise substantially more in these areas in order to make people move.
The space w-age oddity is this emerging trend. Rig staff is already being recruited at the jail house doors. Soon demand for rigs will force new production. With steel and "low tech" electronics capacity so constrained, the new rigs and power plants will strain the whole of the world's capacity while high fertilizer costs will push farmers out of business until prices come up high enough to cover their costs. Our virtual world of "luft gesch�ft" meets hard physical reality.
Prices will have to continue rising - or large scale bankruptcy must put people out of work till demand reduction brings prices back down. The latter is quite unlikely.
An unfortunate miss-typing error occurred towards the end. It should read "should soon show signs of life" (not 'sins' of life). Well, on reflection, maybe it could show both
I have to do these postings rather hurrriedly - please excuse
http://www.ecb.int/index.htmlThe above link is from the website of the ECB. Click the key speeches icon on right hand side.
Speech by Dr. Willem F. Duisenberg,President of the European Central Bank,during the debate on the theme "The euro and the greater Europe", Strasbourg, 24 January 2001.
He sees challenges for the euro but sees a bright future for it.
As I watch the events at the castle from day to day, I have noticed once again, that strange phenomenon where by we are blessed with the company of new visitors who have pulled up their chair at the table and quickly proceed to point out the error of our thinking.
Then, mysteriously, perhaps another new visitor(s) shows up to support the one who's apparent mission in life is to save each of us from our own silly-ness lest we fall into some bottomless abyss of financial ruin. How altruistic, how timely?
And the discussions slowly grow in intensity and rage on, in a dialog not unlike two lines that never intersect, into infinity.
So as I scroll past most of it, I ask myself...what is the motive of those who would go to the trouble to register at an internet forum and waste little time and much effort before going into offensive mode regarding the main theme of the forum, in this case, physical gold = long term wealth preservation.
I cannot imagine entering into the presence of any group of people simply to espouse a contrary, argumentative point of view to what they hold and to do so seems to indicate that there must be some ulterior motive at work. Reminds me of "Blazing Saddles" when Gene Wilder dressed up like a member of the KKK and acted as if he had taken Clevon Little prisoner, all to infiltrate the "bad guys". When they got the attention of the other KKK members, Clevon Little said: "Hey, where's the white women?"
No, we won't relinquish our women, and we won't concede that our thinking is all wrong simply because it is "contrary" to your point of view.
As Stallone said in First Blood, "Let it alone".
On a much, much more pleasant note, Sir WAC, I thought I was the only one who read E.W. Bullinger's "Companion Bible". Glad to see I'm wrong. What a wealth of knowledge! I can also personally recommend his "Commentary on Revelation" - if your not a believer in the rapture (as I wasn't), you will be after reading this. And his "How to Enjoy the Bible". Great works from a great mind.
Sierra Madre (01/24/01; 23:52:15MT - usagold.com msg#: 46394)
Revelation....
I hope you don't linger here much longer. You've had your say, and have been civilly treated by others, who think
differently from you.
You are whining about gold. So whose fault is it? Do we like the situation? No! Do we whine about it? No.
So you think it s...s? OK
Then sell your miserable gold and do something with your life. Nobody is forcing you to buy gold or keep it. So if others
do want to buy gold and hold it, what business is that of yours?
I hope you don't mean to plague this Forum like uptick, goldbuggerer and skinny plague kitco. The reason I like this
Forum is that they are not here. Are you one of their incarnations?
The only real problem the Euro has is that they don't want you rushing in too quick, or too much. Remember, the game is no sudden, sharp movements.
The aim is to bring the dollar and euro to parity gradually, so that you hardly feel the bump - like a great ship docking.
Consequently you will get lots of mixed comments and pontifications. Why? To keep you guessing.
When gold makes its first real move, it will catch you all napping, then it will stop, and appear to come right back down again. But the hold will not be eased until the euro is home and dry.
Unless, of course, a half billion Chinese rush out and buy an ounce of gold - that would set the cat among the pidgeons for sure.
Wouldn't it be fun though. ( I must stop dreaming) This business is NOT for dreamers, but it attracts them like flies to a honey pot
and find it applicable to the recent clamor on site regarding market loses. Kind'a put's it in the perspective of "Pounding Sand"
A philosophy professor stood before his class and had some items in front of him. When class began, wordlessly he picked up a large empty mayonnaise jar and proceeded to fill it with rocks, rocks about 2" in diameter. He then asked the students if the jar was full? They agreed that it was.
So the professor then picked up a box of pebbles and poured them into the jar. He shook the jar lightly.The pebbles, of course, rolled into the open areas between the rocks.He then asked the student again if the jar was full. They agreed it was.The students laughed. The professor picked up a box of sand and poured it into the jar. Of course, the sand filled up everything else.
"Now," said the professor, "I want you to recognize that this is your life.The rocks are the important things - your family, your partner, your health, your children - anything that is so
important to you that if it were lost, you would be nearly destroyed. The pebbles are the other things that matter like your job, your house, your car.The sand is everything else.The small stuff."
There has been mention of a link between gold and drugs in one context or another. It would be interesting if you found out who provides the military training and back-up for the top drug barons' protection and general security - also providing intelligence.
I did but it was buried in small print.
(Clue:One of the world's most elite forces)
I am not a very smart man but I do have a good memory and do read a great deal. To wit; the normal or average growth of goods and services measured as GNP or GDP is in the range of 2-2.5%. You must grant me that for, it is true. I have read that factoid countless times.
Today, Mr. Greenspan said we're "close to zero" (growth). Isn't that a recession?
How much longer can they expect to continue to fool John Q. Public and our international capital providers with mere words?
I learned one more thing today. There definitely is a deliberate effort to intentionally mislead people regarding the health of the US economy. What this means for gold I know not but, I do believe it is very foolish to be invested in most equities at this time.
1. Pretend you are the CEO of a gold mining operation, and...
2. Your company has little or no negative exposure to gold paper contracts.
3. Now, either today's pricing mechanism is effecient and today's low paper prices are justified (In this case, non-hedged mines have a problem), or...
4. There actually is a coming "meltdown" in paper gold when the physical demand can no longer be hidden with in paper charade.
5. Now, you are the CEO of a well prepared gold mining operation. You shrug your shoulders and say, "So what if the paper burns!"...
6. Why can you say this? Buyers are now coming to you directly in order to negotiate purchase contracts. Needless to say, you are receiving prices far and above paper gold. Your are in the "catbird's seat".
This is exactly what should happen if a middle-man (COMEX) no longer provides an efficient pricing mechanism (supply/demand) and "screws" the seller, but it only happens once buyers realize there is a problem (they can't find gold to buy at the quoted, paper price...kind of like the 4.8X oversubsribed auction this week at prices HIGHER than paper gold?)
Guess what?...the mines prepared for this future would make money (and reward shareholders) - the ones not prepared (ala Ashanti and Cambior) burn along with paper gold as they take their paper losses.
Physical gold IS a wealth preserver and has its place in every portfolio, but this does not negate the leverage of a mine properly prepared for the return to an efficient market pricing system (even if that system is direct business to business sales).
Letter from a friend, old oil hand, lives in Texas.
The following is a recent thing I responded to with some of the coffee Group. I have miss several meetings . but it seems that the Coffee Group has just discovered the energy problem? I was talking to Gene Dugger, my Dalhart Railroader expert last night and he tells me that his gas bill three months ago was $75, 2 months ago $130 and this last month $250. of course it is a lot colder up in Dalhart but my point is that in California, where the shortage is felt utility prices are firm no price increases. The consumers in Dalhart and elsewhere are already having to pay for the price increases in gas created by Demand. whereas in CA prices are frozen but get the gas anyway. I heard this AM that VP Dick Cheney came up with an idea that in order to get power into CA that we build Power Plants in Mexico. Perhaps that avoids our enviornmentalist, but does nothing to obtaining the manufactored parts such as turbines.nor the fuel supply. The Speculators have already contracted mftg space for Turbines for a few years out, no space available. There is not enough gas now to fuel the Power Plants that are built much less the plants projected. 25% of natural gas in USA now comes from the Gulf of Mexico Waters. They have been producing at maxiumium volumes and the decline curve is 20-25%/year for these early years of production, the rate of decline then smooths out, but deliverability is gone. The proposed Power Plant here in Montgomery County is by a CA nonregulated company that is a subsiduary of a regulated company. They propose to sell power to the highest bidder. The credit and talent of the regulated company was diverted to this nonregulated company and the CA rate payers that created the opportunity do not participate. Back to the proposal to build a Power Plant in Mexico... for months there has been a proposal to export electrical power from a Arizona nuclear plant to Mexico, but the USA enviornmentalist have blocked the proposal as they do not want the transmission towers built across that isolated barren desert land of southern Arizona where very few people live and almost no roads, talk about desoluate, perhaps the most isolated desolate area in North America, other than North of Hudson Bay. Things never change. Did you listen to Allen Greenspan today in his testimony before the Senate Finance Committe?, by the way Chairman Dominice's wife stayed at our house with Millie while I escorted him around Southern New Mexico back in his early days as a candidate, I could hardly believe my ears, I only heard the last 30 minutes or so but will try to catch the reruns on CNN tonight. The most optomistic forcasts I have ever heard, provided we are able to continue our level of Productivity Gains. There is so much tax money projected that there will be no place to put it, will pay off the debt and push all commerical lenders out of the housing market. Billions and trillons of dollars. I hope this all takes into account the fact that the massives profits made on Technology stocks to those founders that sold to the Bag Holders and paid taxes before the collaspe is nonrepeatable.
I'm just a beginner in this gold market. I've studied the postings on this forum for about 9 months and have learned a lot. I have come to see that turkey hunting and waiting to hit the gold market at the right time have 2 common denominators. One is patience the other is the unnaturalness of it all. Let me explain. To kill a wild turkey one has to have patience to sit and wait. I might sit in camouflage for two or three hours making a yelping sound like a female turkey knowing that there is a big gobbler strutting right over the hill. He gobbles and sounds like he is coming in range for a shotgun blast to the head, but five minutes later he gobbles and is afar off.. The adrenaline comes and goes and I wonder what I did wrong. But in reality I never did anything wrong for the gobbler turkey thinks in an unnatural way when it comes to hooking up with a female turkey. In most animals the male will seek the female but not the wild turkey gobbler. He expects the female hen to come to him. So I can sit there, and yelp all I want, but chances are he will not come in right away because he thinks I'm coming in to him. Only with patience can I succeed for I know the gobbler will run his course. He will walk the same path as he did yesterday. This is why it is important to scout the area out and know what the turkeys are doing the time of day one will be hunting. So it is with gold. We are trying to find answers in a unnatural market. The market is manipulated. We know what path gold will take. We wait and wait and wait. We think it is about to happen only to have the adrenaline shoot up and then down again, and then it starts to rain and we want to give up and call it a day. But we wait for we know the path gold will take. History repeats itself; nothing stays the same (except the commandments of
God). Gold has and always will be valuable it is just some men would like us to think other wise; because they want as much as they can get first.
He who has the knowledge and patience can bag the big gobbler and hold a bag of wealth.
I'm just a beginner in this gold market. I've studied the postings on this forum for about 9 months and have learned a lot. I have come to see that turkey hunting and waiting to hit the gold market at the right time have 2 common denominators. One is patience the other is the unnaturalness of it all. Let me explain. To kill a wild turkey one has to have patience to sit and wait. I might sit in camouflage for two or three hours making a yelping sound like a female turkey knowing that there is a big gobbler strutting right over the hill. He gobbles and sounds like he is coming in range for a shotgun blast to the head, but five minutes later he gobbles and is afar off.. The adrenaline comes and goes and I wonder what I did wrong. But in reality I never did anything wrong for the gobbler turkey thinks in an unnatural way when it comes to hooking up with a female turkey. In most animals the male will seek the female but not the wild turkey gobbler. He expects the female hen to come to him. So I can sit there, and yelp all I want, but chances are he will not come in right away because he thinks I'm coming in to him. Only with patience can I succeed for I know the gobbler will run his course. He will walk the same path as he did yesterday. This is why it is important to scout the area out and know what the turkeys are doing the time of day one will be hunting. So it is with gold. We are trying to find answers in a unnatural market. The market is unnatural (manipulated). We have done our homework and scouted it all out. We know what path gold will take. We wait and wait and wait. We think it is about to happen only to have the adrenaline shoot up and then down again, and then it starts to rain and we want to give up and call it a day. But we wait for we know the path gold will take. History repeats itself; nothing stays the same (except the commandments of
God). Gold has and always will be valuable it is just some men would like us to think otherwise; because they want as much as they can get first.
He who has the knowledge and patience can bag the big gobbler and hold a bag of wealth.
Isn't there a fair amount of controversey surrounding this gentleman. True, there is an ancient ruin upon the site you reference but, did not an archeologist of that same period salt the ruins to make his discovery seem more credible? Was it this German? Wasn't there something about a necklace or jewelery that was not authentic? Didn't this fellow actually destroy a lot of the excavation? Am I thinking of someone else?
All Right! Turkey Hunter. Welcome aboard. We have a few things in common. Both of us hunt. We are looking to accumulate wealth with gold. We are new to this arena. Great story for comparison. Been there. When gold takes off, what a rush that will be.
Hey! Hoosier Goldbug, always enjoy your enthusiasm. Keep it up. Stay the plan. Told you all about the small time investors.
Do not worry about the negative posters. It is hard to laugh in the face of adversity. Learn from them.
To all you seasoned warriors of the gold war I say
Morgan Stanley Dean Witter / Funny Business ? ? ?I told my broker that I wanted to hold my stock certificates because
I was afraid if the stock market tanked Morgan Stanley Dean Witter could go
under and I did not want to wait till a judge figured out who owned what.
He told me no problem. Well it has been about three weeks or more . I
received my Harmony on Monday and Goldfields on Tuesday but still no Golden
Star Resources. My aunt has received her Harmony and is still waiting for
her Goldfields, Golden Star Resources, Glamis Gold Ltd. I spoke to my broker
this afternoon and he said that Harmony and Goldfields was sent out on the
16 , Golden Star Resources on the 19 and Glamis Gold Ltd was sent on the 23.
My question is does Morgan Stanley Dean Witter buy and sell these stocks to
make money for Morgan Stanley Dean Witter? Could they use my shares to hold
down a stock and then repurchase the shares at a later time on the cheap. I
smell a rat but then again I am very suspicious of Morgan Stanley Dean Witter.
Any thoughts on this ?
It is long past my bedtime, I have made my hot chocolate, but I will leave you with this thought. Think of the volume of money that is sloshing around out there - especially in the stock market. A lot has drifted out, and more will follow. It will only take a very small percentage indeed of that massive volume to start trickling into the mining sector with its low cap to send it flying.
I guarantee that has not gone unnoticed by certain people, who have been quietly picking up all the stock that disillusioned 'goldbugs' have been selling.
Because of the low cap, they have had to pick it up in drips and drabs, otherwise they would have bid against themselves - n'est ce pas?
One day, one day ............and not that far away. What's another year, if that, (and I don't think it will be).
Interest Rate Cuts + Tax Cuts + Money Supply Growth in 2X Digits + Higher Energy Cost = Inflation.
I believe your former associates at the Wall/Broad stockyards have the dots connected. Despite their understanding of simple geometry, they are leading the hogs to slaughter and are enjoying their bacon bit by bit.
When the last carcass has been picked clean, they will swear off that "other white meat" for a horse of a different and golden color. Some things never change; pork really isn't that good for you. They were right in the Pentateuch. Shalom....CM
Turkey Hunter, WELCOME TO THE GOLDEN TRENCH! If you or SLINGSHOT need a place/grounds for wild turkey, you're always welcome to SOUTHERN INDIANA. Doing a real estate appraisal in SPENCER COUNTY, INDIANA, Tuesday, came across 6 wild turkeys in a cornfield. What a beautiful site to behold!
Hey grasshopper, BRING ON THAT $190.00 an ounce and keep me in mind when you do really sell! Contact: dpersoh1@freewwweb.com WITH PRICE LISTS/delivery couriers, terms, etc.! Physical, that is! What a rush that will be. FIAT PAPER for $190.00 PHYSICAL GOLD! Oh, Oh, what's that saying: If it sounds too good to be true, it probable isn't true.
You can relax. It is perfectly normal to wait six weeks or more before receiving your certificates. This is because the broker has been holding them in street name. In your case, that means Morgan Stanley is the registered owner. This is always done in order to make it easier for clients to sell with a simple phone call when the time comes. But it means that ordering them out will necessitate their being turned in to their respective transfer agents first. The transfer agents then destroy the certificates and replace them with new ones entitled to you. The new ones are then sent out to the broker who only then mails them out to you.
And keep an eye on that mail box. You'll want to be sure you let your broker know after about 60 days if you have not received all of your certificates. Replacing lost ones after that will require your posting an insurance bond, which is not inexpensive.
What with maintaining your own tax records, cashing your dividends and keeping track of stock splits, you may quickly realize why clients with large portfolios usually prefer to leave the certificates on deposit with their brokers.
Duly noted and added. Timely too, since I just got a shocking car repair bill tonight. I'm still not factoring "schrinkage of product", ie; smaller restaurant portions or diminished services. My health insurance renewal had higher co-pays, more exclusions, and more restrictive presription criteria. Thanks for the tip.
Technically, a recession is when the economy experiences two or more consecutive quarters of negative growth (shrinkage, if you prefer) in GDP. Zero growth almost gets you there but not quite.
As to your comments about Wall Streeters having the dots connected, I respectfully disagree. I wouldn't give these guys credit for any more intelligence than they have got. An awful lot of them are just like Joe Battipaglia (if you know who he is). They are ALWAYS bullish on the economy, and they are always bullish on stocks.
Mark my words. Inflation will continue to climb this year. Sooner of later, gold and the dollar will react. To a man, these Pollyannas will claim that nobody could have seen it coming. The hang of it is, such earnest mendacity will mollify all but the most discerning of their clients. It's irritating as hell, but it always works that way.
Anybody wanting to throw a bucket of icewater on a grasshopper should rent the 1990 film "Trigger Effect", about a power collapse that drags on for a few weeks. It is a very real portrayal of a social breakdown after grid failure. Y2k preparers may one day be redeemed if California continues to descend into hell. I know I have no plans to travel there next summer.
The way I understand it, your stocks when held by your broker, are in electronic or ledger form only. I would guess the brokerage house may use the dollar value of your stocks in some way, shape, or form, the same way a bank uses bank account holders assets to create new "money".
Some of the companies you mentioned in post 46473 are South African based companies,their stock is traded in the U.S. as "ADR's(American Depository Receipt's) or ADS's(American Depository Shares). The Bank of New York(The Fed) holds actual ownership of these shares(Electronic?)issued by companies outside of the U.S. The Bank of New York than gives permission for brokerage houses to trade "proxy's" of the actual shares(ADR's & ADS's) on U.S. Exchanges. A subsidiary bank also acts as a fiduciary agent for your shares, keeping track of dividend payoffs and quarterly & annual report mailouts. This bank issues the actual ADR,ADS
certificate to you. A month wait for dividends or certificates is not too unusual.
Sirs Stranger, van Eeden, Nickel62, or Peter Archer or others, if they're reading may be able to go into more detail about this process.
Now, does anyone see a flaw in the above percieved ownership of your stock shares?
Here it is:
1. The Bank of New York owns the actual shares of your company, and may count the value as assets on their published financial statements.
2. The subsidiary bank may also count the value of your shares as bank assets when filing financial forms, for their bank.
3. Your brokerage house may also include the share value on their financial statements, if the shares are held by them.
4. And you my friend Shifty, are supposed to name the company that paid dividends(If your in certain tax brackets) on your income tax returns and you would naturally add the dollar share value into your own personal financial assets.
All this was written to show that it is possible for "4" different entities to claim the value of your stock shares, at the same time!
Real "Physical" Wealth such as Gold can only be in one place at a time!
Get "Real" wealth, get Gold....beesting.
Thanks Stranger . I thought you or someone here would know. The reason I was concerned was my broker told me it would take a week to ten days. My broker is a real nice guy, I just don't trust the people he works for (Morgan Stanley Dean Witter) . Seems they are forever getting fined for some illegal activities. They don't seem to care if they get fined because they make far more money than the fine costs them. I would change brokerage companies but I like my broker.
I have been following Placer for a while. They have in effect said, "..as of Feb. 00 we are reducing hedging", thus the mini-spike to $312.
The Placer CEO, (god I'm bad at names) Taylor said in several announcements that "Placer will shut down marginal operations (as well should other mines), and be profitable without further forward sales and exotic sales."
I believe Placer is a Unhedged (want-to-be). I also believe they are moving towards that end.
Your statement of buyers coming direct to suppliers is most interesting. Yes, I see buyers coming to Placer at the 'government trade deficit reducing price' of $562 per ounce. That is to say that the 'paper POG' of $266.34 is not the price.
Good post amigo, yeah, Placer (and Barrick) talk in todays paper of major writedowns but let's be really honest here.
Who's working for $400 plus and who is not? Placer or Barrick?
Your CRI index is very close to mine. The only differences are as follow:
1) I have no core rate exclusions due to the fact that I have no debt, home or otherwise
2) I have no way of monitoring health care expenses in the last several years, because my wife and I self-insure (not recommended for the masses) and since we have had no illnesses in the recent past, we have no way to tell about the increased cost of medical care for us, therefore I defer to your number. A rather sobering thought for us who will have to pay when the time comes to divy up.
I was impressed that the numbers you came up with as they are so very close to what we have experienced. Your food cost increase of 8% (higher if eating out) was right on the money for my wife and I. We eat out more that half of our meals and our cost increase for eating out year over year for about three years would apporach 13%,.
If our experience is the general one and I believe it is, then Greenspan who generally doesn't lie (only desquises the truth so that we do not react in an improper manner) will be exposed in due time. This inflation is a bombshell. Rhetoric and distortion of the facts will not make it go away any more that it will make budget deficits and trade devicits go away.
beesting: I own physical gold just in case the shares don't work out. If I was not under water in them I would likely sell some of them to buy more physical. I am not into stocks. I own them just in case the Government wants to try to steal the real deal.
This reminds me of the fox that killed one of my hens last night. Could be some gun play at $hifty's place tonight. Time to take a walk with my friend Dan Wesson.
:-)
After hearing about how Easy Al told congress today that he is now (suddenly... what a co-oincidence!) no longer opposed to tax cuts because projections are (now, suddenly... what a co-oincidence!) for the federal debt to be paid off within 10 years... and that the only thing that could change that would be a "prolonged downturn in the economy".
This also fits perfectly with what FOA has been saying for some time: That Greenspan does not enjoy the luxury of a recession to prolong the life of the dollar by squeezing out the effects of excessive money creation through recession because of the Euro waiting in the wings to assume reserve currency status.
And both of these concepts fit with the traditional view and purpose of inflation and debt repayment... The time-honored practise of paying off debt with less-valuable (ie inflated) fiat units. Remember the German inflation of the 1920s that was allowed, even encouraged by the German government for the purpose of liquidating the German war debt created by Germany's loss of WW I? Or the so-called Carter inflation of the 70s that came about as a way to pay back the excesses of the Vietnam war years? Sure looks like that's what Easy Al and Company have planned for us. Only this time, they're already on their way to inflating away 75 years of irresponsibiliy through the inflation of the very world reserve currency itself. Is this the first time inflation has been used on such a scale, FOA?
Trail ContinuesPutting together my simple premises with the info from Orville G--- Gold is a common currency used in exchange for your 3 O's, and a nice "dark" currency it is. If I sell a lot of O {lets say oil} and make a lot of profit, in gold per cheap dollar terms, then some of that "currency" will find it's way to market. This depresses POG, again in dollar terms, and sets up a cycle where even greater amounts of gold can be had for same Oil. Drives POG down as long as the SUPPLY of Au is available for these transactions. Right?
Continuing forward, regardless of the absolute correctness of the premises above: What factors will cause a change in profitability of your 3 O's? Oil is quite profitable right now and likely will be for a few more years until pendulum swings back. your other two O's are probably quite profitable right now for at least 2 obvious reasons: Boom times with lots of money sloshing around. The supply is controlled to a degree because of the illegalities of these substances. Cartels, turf wars and so on act on these substances like existing control of diamonds.
So, what busts up this formula for success? 1. Unprofitable oil {look back a couple years} 2. Unprofitable illegal drug trades {have no clue on how that changes except what mentioned above} 3. Back to gold supply problems {if the gold is not there it can't be used in this cycle of trade}. All of this depends on a large flow of "tarnished" gold. That and Oil look like the leading candidates for change in this cycle.
Anyway, come on back, teacher, before I make an even bigger fool of myself.
http://www.tsp.gov/ I was watching Fox News and they were discussing Greenspan and paying off the national debt.
One economist said that if you paid off the debt there wouldn't be anything to invest your money in.
There wouldn't be any debt based US Treasury bonds.
I thought this was rather amusing as I was discussing the same topic with a liberal Democrat co-worker just the other day.
If there was no debt, there wouldn't be any Government Employees Thrift Savings Plan G-Fund (Gov't bonds) or F-Fund (bonds and another asset). The only thing you could stick your retirement fund into currently would be the C-Fund which follows the S&P Index.
Steve Kaplan known gold trader says:
Why everyone is hoping for a reccesion to move gold is
beyond me becuase demand would fall off and so
goes the price of gold possibly. This is not carved out in
stone but I think Steve knows more than we do. Panda
Gold on this forum states that the USA titanic sinks into economic turmoil GOLD will be our life rafts. Maybe or
maybe not but one thing is clear GOLD can't rally for
anything.
Black Blade: Funny � Gold reacted exactly the opposite to that proposed scenario during every recession in modern history, not to mention that gold investments were tremendous gainers in deflationary environments as in the "Great Depression". Albeit, gold ownership was illegal in the US at the time, however, gold "proxies" such as Homestake Mining did extremely well. Many such as Mr. Kaplan simply don't remember history.
Yesterday, I went down to OfficeMax to pick up a new paper shredder. Burned mine up trying to get rid of a lot of documents (wonder if Clinton ever had that problem ?). Anyway, the little crosscut shredder I bought went for $20. Four years or so ago, when I bought the first nearly-identical shredder, I paid $50.
On the other hand, my electric bill was a third higher last month than it's ever been before.
But as you know, in my view, prices are only marginally relevant at best as an inflation/deflation indicator. Liquid/illiquid markets, capital flows, and Fed actions flash us the warning signs. Events of the last year only re-confirmed that deflation pressures are firmly in control. It's only a matter of time before deflation pressures turn to outright deflation.
As Jim Stack points out in his latest: "Twice in his 13-year tenure, Greenspan has pulled the plug on interest rates in a panic fashion. The first was immediately after the 1987 Crash, and the second was during the Asian Crisis of 1998."
Three weeks ago, only a little more than 2 years after the last panic cut, he did it again. You know what they say about trying to outrun a tornado. Greenspan is losing the race.
It's remained my view that Alan Greenspan is the quintessential Ayn Rand anti-hero. Staunch sound money advocate turned ultimate statist. Practicing monetary policy that serves to pacify the people and keep the ruling class comfortably in power (Gore-bachev notwithstanding). The thought that the market might finally break his back excites me to no end. The first block would then be in place in making the US a truly free country.
Still, from a historical and philosophical standpoint, there is at least one real positive to his fiscally outrageous behavior. Socialist Keynesians and de facto socialist, Fed-apologist Friedmanite monetarists have blamed the Fed of the �30s for simply not providing enough liquidity to overcome that deflation, contrary to the evidence and analysis provided by Austrians such as Murray Rothbard, who proved that that Fed desperately tried to inflate but couldn't. Greenspan can never be accused of being stingy with liquidity. Once the current economic imbalances are resolved, that argument will be over, one way or the other. Perhaps that's the idea. A method to his madness ?
View
Yesterday's Discussion.
Attn: turkey hunter (1/25/2001; 17:20:43MT - usagold.com msg#: 46468)Hello Turkey Hunter.!.
You wrote:
[snip]
To kill a wild turkey one has to have patience to sit and wait. I might sit in camouflage for two or three hours making a yelping sound like a female turkey knowing that there is a big gobbler strutting right over the hill. He gobbles and sounds like he is coming in range for a shotgun blast to the head, but five minutes later he gobbles and is afar off.. The adrenaline comes and goes and I wonder what I did wrong. But in reality I never did anything wrong for the gobbler turkey thinks in an unnatural way when it comes to hooking up with a female turkey. In most animals the male will seek the female but not the wild turkey gobbler. He expects the female hen to come to him. So I can sit there, and yelp all I want, but chances are he will not come in right away because he thinks I'm coming in to him.
[unsnip]
Sell shotgun. Buy Doberman. Make TurkeyFeather outfit. For Doberman. Look like
TurkeyHen. You in camo. Make noise. Like gobbler. Him come, then turn away.
Loose Doberman. (hen). Gobbler not know what hit him. You. Fetch Gobbler. From
jaws. Doberman not eat Turkey. Only people. Be careful.
SHIFTY RE: Stock Certificates - registration, etc.
I have held certificates in the past. I have at times deposited certificates into a DRIP where the shares are registered in my name and I also have accounts with firms such as BuyandHold.com where all shares are held in my name. If your broker holds the shares, then the brokerage holds them in "Street name" and they get to vote on the proxies as they are considered the "owner" of the shares. As you already know, you can request delivery of certificates though some brokers balk at that idea. The advantage of course is that I can vote on proxies, get free reinvestment of dividends, and the fees are extremely cheap. I just don't like to hold a lot of certificates if I can help it. I hold my certificates for Goldfields (GOLD) for example because they don't participate in some of these plans, whereas Harmony (HGMCY) and Durban (DROOY) do. At least if any of the Hedge-Fund producers make a move on Goldfields, I can vote against it as a registered owner of the shares. As far as the physical is concerned, I have a good place for that where I and a couple of very close trusted family members are the only ones with access in the event of an emergency.
The California energy crisis may be playing a role in sky-high Midwest natural gas prices, experts told the Illinois Commerce Commission Wednesday. Although California's well-publicized power woes are focused on high electricity prices, the Golden State's problems are linked inextricably to natural gas. The reason: Almost half of California's electrical generating capacity comes from natural gas-fired plants. This winter's higher natural gas prices, in fact, are a prime component of the higher prices for electricity in California. Low rainfall has put a dent in California's supply of hydroelectric power, making the state more reliant on natural gas.
And, say experts, some gas intended for other markets, including Chicago, has been siphoned off to meet California's need. "If gas can flow to the highest-price market, it will, and it will affect markets in the rest of the country," said Cynthia Albert, vice president, regulatory affairs for CNS Energy Panhandle Pipe Line Cos. "The natural gas pipelines serving California are obviously full," Albert said. "They are moving as much gas as they possibly can." Albert was among experts who testified Wednesday as part of the ICC's investigation of the state's high natural gas prices. And she wasn't alone in her opinion that the California crisis may be siphoning off needed gas.
Donato Eassey, an energy stock analyst for Merrill Lynch in Houston, was unequivocal about the fallout from California's power crisis. "I think it has had an impact on gas prices nationally," Eassey said. "There's no doubt about it. You are going to pay one way or another." The Chicago market, say Albert and others, still is receiving adequate supplies of gas to meet the demands of consumers. They say this is primarily because of the opening last month of the Alliance pipeline, a new producer-built pipeline that is bringing gas into the Chicago market from Canada. Some 1.3 billion cubic feet of natural gas is being piped through Alliance each day, she said. Nonetheless, Albert said her firm was commissioning a study to determine how diversions of natural gas to California may be affecting the market. "Gas is in fact going west," Albert said. "We are not filling up our mainline pipeline, which is the first time we've seen that happen in a cold winter like this."
Albert added that she was talking about a relatively small amount of natural gas going towards California on her company's pipeline. The Panhandle Eastern pipeline on a peak day transports roughly 2.5 billion cubic feet. In contrast, the amount going to California is about 200 million cubic feet a day. "I think there is competition for the supply we haven't seen before," Albert said. But she noted that she had no idea how much natural gas other pipeline companies were shifting toward California. "I don't have data on what this means for the Chicago price," Albert said. "Chicago is still getting a good price" compared with other places, where prices are just as high or higher.
Black Blade: The energy crisis is spreading east like an oil slick on water. Cheeta (AG) today said that Kalifornia's energy woes would not likely affect the rest of the US. Hmmm� There's just no way that this crisis can be contained in Kalifornia alone. The state is the world's sixth largest economy and the effects are sweeping across the US. Already, price increases for energy have increased several fold across America. Anyone who thinks that the higher energy costs won't show up in higher costs for goods and services (inflation) is walking through life wearing "Rose Colored Glasses." That is why I find Cheeta's statement somewhat bizarre. He knows better (I think). He obviously knows that the jig is up. He had stressed that a tax cut was a bad idea, now he says that it's a good idea. He as the "Head Fed" and his buddies cut rates 50 bp, and are poised to follow-up with another cut of 50 bp. He is running scared and Wall Street should be too.
NEW YORK (Reuters) - Record high U.S. natural gas prices and power blackouts in California this winter have some thinking the unthinkable: Tapping nuclear power to meet the country's rapidly growing electricity needs.
While no one is expecting a raft of new nuclear power plants any time soon -- none have been built here since 1978 -- the recent spike in gas prices has put nuclear power back in play. Nearly every power plant being built here is gas-fired, boosting competition for already tight fuel supplies. ``One of the main things holding back nuclear power has been cheap natural gas, but with gas prices this high, the nuclear option is back on the table. People are running the numbers to see if it makes sense,'' said John Redding at General Electric's GE Nuclear Energy division in San Jose, Calif. Twenty years ago the nuclear industry was plagued by cost overruns and safety concerns.
Today, under better and safer management practices, nuclear power plants produce electricity about 90 percent of the time at a cost of 1.83 cents per kilowatt hour (KWh), outperforming fossil fuels like coal, oil or natural gas.
``It does not make much sense to have all your energy eggs in one basket. We support a balanced approach to energy policy with a mix of fuels,'' said Vaughn Gilbert, public relations manager of British Nuclear Fuel's (BNFL) Westinghouse Electric Co. in Pittsburg, Pa. Industry experts expect most, if not all, of the nation's 103 nuclear plants to extend their operating licenses for 20 years. But some utilities are taking a further look at nuclear power, particularly if they are able to build at existing sites and use a standardized design that could streamline the lengthy licensing process and cut construction expenditures. ``The best place to go (to build) is where you already have sites. Those communities are generally supportive and the local work force is skilled,'' Westinghouse's Gilbert said.
Westinghouse, one of the nation's largest suppliers of nuclear power products and services, had a standardized design for a 600 megawatt nuclear plant approved by the Nuclear Regulatory Commission (NRC) in 1999.
No Greenhouse Gas
Nuclear plants currently supply about 20 percent of the nation's power, with coal still the biggest provider at more than 50 percent. Gas comes in third at about 17 percent. With stricter environmental laws likely to keep upward pressure on fossil fuel operating costs, analysts said nuclear power is likely to become increasingly competitive.
While the advantages of nuclear have always been obvious to some -- cheap, stable fuel costs and no greenhouse gas emissions -- regulatory hurdles that drag out the permitting process and environmental concerns over disposing radioactive waste fuel still make nuclear a risky option. But that may be changing. ``The biggest hurdle is the uncertainty in the licensing process and we're working with the NRC to ensure that the licensing process is more efficient. We also hope to get a decision soon on a nuclear waste depository,'' said Marvin Fertel, senior vice president at the Nuclear Energy Institute (NEI), a Washington, D.C.-based policy organization for the nuclear power industry.
Making A Big Bet On Gas
There are some 300,000 megawatts of proposed new power generation planned for this decade, almost all fueled by gas because it is considered environmentally-friendly and plant construction costs are cheaper than other alternatives. A new combined cycle gas-fired plant can be built for $500-600 per kilowatt and produce electricity at a total cost of 3.5-4.5 cents per KWh, assuming gas prices of $3-4 per million British thermal units (mmBtu).
But Henry Hub gas prices last year averaged more than $4 per mmBtu and projections for 2001 are in the $5-6 range. In contrast, a new standard design nuclear plant can produce power at about 4.5 cents per KWh assuming capital costs of about $1,500 per kilowatt. Some industry experts said power suppliers may be making a big bet on the clean-burning fuel that may not pay off, noting current growth rates in production and pipeline capacity may not keep up with rapidly rising gas demand.
Mix Of Fuels May Be The Answer
GE Nuclear's Redding said a mix of options, including nuclear may be the more practical strategy to meet growing electric demand. ``I think what recent experience demonstrates is that there is an argument for a portfolio of different fuels. I still leave my (nuclear) order book at home, but we've had meetings with several U.S. utilities that are exploring their options,'' Redding said. New Orleans-based Entergy Corp. , the nation's third largest power producer with more than 30,000 megawatts of generating capacity including eight nuclear units, agreed volatile gas prices have put nuclear power back in the mix. ``Certainly high gas prices improve the relative economic picture for a nuclear power plant. The volatility of gas prices gives validity to the need to have a mix of fuels with nuclear as part of it,'' said Diane Park, manager of communications for Entergy Nuclear Southwest, adding new nuclear construction was being looked at, but there were no definitive plans yet. But some analysts said deep-seated public concerns about safety may be a roadblock to new construction. ``I'm skeptical about the nuclear option. If gas prices stay high, utilities are going to look for something else, but it probably will be coal first. There's a lot of uncertainty about the public reaction to nuclear,'' said Joe Sannicandro, a director at Massachusetts-based consultants Cambridge Energy Research Associates (CERA).
Black Blade: Wonders never cease. However, there is still an established presence of environmental activism lodged in various Washington DC government offices. After 8 years of radical environ-nut Bruce Babbit and world renowned Earth Scientist Al Gore (also known as the inventor of the internet), the prospects of building up nuclear power generating facilities in time to stave off a collapse of the energy grid is dubious at best. Not a bad idea though. The Dog and Pony show yesterday starring the "Amazing Cheeta (AG)" and the self-promoting drunk with power senators did bring up the issue of the energy crisis. Cheeta said to drill more for NG. Hmmm� I suppose he has a suggestion on where to find some idle drill rigs? Typical "Bean Counter" response when professional advice and action is required.
Yeah - Yeah, I know, like Donald Sutherland said in "Kelly's Heroes", I gotta stop with the "negative waves." ;-)
http://biz.yahoo.com/rb/010125/cv.html NEW YORK (Reuters) - Rail giant CSX Corp. (NYSE:CSX - news) rounded out a difficult week of earnings reports for U.S. railroads on Thursday, saying that, like its rivals, higher fuel costs and falling demand pressured its fourth quarter. Industry leaders were cautiously optimistic about forecasting future earnings for the railroads as continued weakness in the economy coupled with high fuel costs and winter weather conditions plagued profit margins.
``We knew this was going to be a week of bad news and now it's over,'' said Michael Lloyd, railroad analyst at Deutsche Bank Alex. Brown. ``Those railroads that are cutting their costs and reducing their cost structure in line with lower economic growth will be well-positioned for much better earnings once we get past this first-quarter of uncertainty.'' He said most railroads will probably report earnings that are flat to down in the first quarter as fuel costs are still higher than a year ago and the economy remains weak. ``The only hope will be that coal bails some of them out,'' Lloyd said. Nick Kovich, a former portfolio manager with Morgan Stanley Dean Witter and a major railroad investor, said he has much of his investment riding on a resurgence in coal. Coal is a main commodity that railroads transport and demand for it has dropped as the economy stalled last year. ``The prospects for coal have clearly brightened...given what's going on in the energy market with California and natural gas,'' said Kovich, who says he owns ``thousands'' of shares of Union Pacific Corp. (NYSE:UNP - news) stock. Kovich also thinks the worst is over in terms of soaring fuel prices.
WEEK OF EARNINGS REPORTS
A week ago, Union Pacific, the nation's largest railroad, reported its earnings fell 5.3 percent, in line with lowered forecasts, as it succumbed to surging fuel prices and dropping demand because of the softening economy.
Omaha, Neb.-based Union Pacific reported earnings of $229 million, or 90 cents per share, before a one-time charge resulting from its Dec. 27 decision to cut 4 percent of its workforce. That compared with net income of $242 million, or 95 cents per share, a year earlier, it said. Union Pacific ``confirmed what everybody knows, which is that it's a tough economy and fuel prices are going to remain high,'' said Jill Evans, an analyst at J.P. Morgan Chase.
Fort Worth, Texas-based Burlington Northern Santa Fe Corp. (NYSE:BNI - news) on Tuesday said its fourth-quarter earnings fell 19 percent because of poor winter weather conditions slowing down rail service. It also experienced high fuel costs and dramatic drops in shipping due to a weakening economy. Burlington Northern still managed to edged out Wall Street expectations by a penny, reporting net income of $255 million, or 65 cents per share. That compared with net income of $315 million, or 69 cents per share, a year earlier, it said. On Wednesday, National Steel Corp. (NYSE:NS - news) called its fourth-quarter results ``disappointing'' and it said it was pessimistic about its near-term outlook as a weaker auto and construction market would curb demand for rail shipments. Also on Wednesday, Norfolk, Va.-based railroad Norfolk Southern Corp. (NYSE:NSC - news) said its fourth-quarter earnings rose, but its stock plunged as investors reacted to its announcement on Tuesday that it would cut 6 percent of its workforce, slash its dividend and get rid of 12,000 freight cars as part of a restructuring made necessary by the slowdown in the economy. Norfolk's earning results, while still in the black, ``reflect both the successes of improved operations and the challenges of significantly higher diesel fuel prices and a slowing economy,'' said David Goode, chief executive, in a statement.
IMPACT OF SURGING FUEL COSTS
Norfolk Southern paid 45 percent, or $43 million, more for fuel in the fourth quarter compared with a year-earlier. The railroad said it even consumed 3 million gallons less than in the fourth quarter than it did a year earlier.
``We are experiencing the highest diesel fuel costs in the past 10 years, even higher than during the Persian Gulf War,'' said Henry Wolf, chief executive, during an analyst meeting Wednesday. Norfolk Southern said remained ``hopeful'' diesel fuel prices would moderate. It wasn't the only rail company to shell out more cash for the same amount of fuel consumption quarter-to-quarter. Union Pacific's fuel costs rose 73 percent from a year-ago to $335 million on almost the same amount of fuel usage a year ago. The average price per gallon of fuel rose to $1.03 from 60 cents in the fourth quarter of 1999, it said. On Thursday, CSX reported a 29 percent rise in fourth-quarter operating profits as it cleared up traffic congestion on its lines and improved service. The railroad, however, missed Wall Street expectations as soaring fuel costs and falling demand pressured earnings. CSX Corp. (NYSE:CSX - news), based in Richmond, Va. and which runs the largest rail operation on the U.S. East Coast, paid $55 million more in the fourth quarter, compared with a year earlier, to cover the high fuel costs. The railroad said it paid $1.10 per gallon for diesel fuel in the fourth quarter compared with 74-cents a gallon a year-earlier for virtually the same amount of fuel consumed.
RESTRUCTURING THE ANSWER
While Norfolk Southern has already announced a restructuring move, Kovich calls it defensive because the railroad was already in a weakened position when it made the decision to restructure to maintain its financial viability. ``All these companies are aggressively attempting to raise prices to offset energy, labor and other costs increases,'' Kovich said. ``Several of these companies have announced restructurings or will announce restructurings.'' He said Canadian Pacific (Toronto:CP.TO - news), which saw its fourth-quarter profit nearly double from its huge earnings in its oil and gas unit, would possibly restructure its portfolio and do a share repurchase to boost up the stock price. Some of the smaller railroads, such as, Wisconsin Central and Kansas City Southern could become targets for larger railroads to acquire later this year, Kovich said.
Black Blade: Let's see here. The cost of transporting goods is higher. Pass along those costs to the consumer? The railroad hopes for higher coal prices. See where this is going? If coal prices rise, then another avenue of energy price hikes. I suppose that there won't be any inflation as under the "Hedonic" pricing method, the coal is higher quality because it will be transported in higher cost rail hoppers, therefore it is somehow better coal, and therefore no inflation. Yeah, I know � I don't get it either. The boys and girls at the BLS seem to have it all figured out though.
Turbo: great to see you back on the board with your rational observations of what is before us.
Hoople Re - inflation index
Those numbers are real but a true index needs to be apportioned according to the percentage of the average consumers budget they represent. Also, car and home finance are a major part of most people's dollar payout and therefore must be included for a true picture. "Lack of volatility" is no more ground for leaving them out then there is ground for the Fed to leave out food and energy. The cost of making ends meet is what it is. A sudden spike on any particular month will always contribute to emptying that months wallet. Any good or service that creates a noticeable effect on most folks expenditures would be in a valid index.
Another thing about home energy costs is that they are selective. Our electric bill is 2/3 of what it was the winter we moved in. Kw/hrs are up and our space is 400, vaulted with glass, square foot larger, but we also extensively upgraded with wider walls and roof sections containing thicker insulation. (Another type of hard asset investment that pays off all the better with inflation) When my daughter converted to NG last October in Portland they were given a one year contract with a 25% cap.
Vehicle finance is definitely down and sagging sales are trimming the profit margins, as dealers bargain to move inventory. We just now traded in both vehicles on comparative but upgraded models. One had a unknown quantity of blown head gasket, the other needed $2500.00 of bodywork, both were 2/3 down on rubber and well past warranty. Now we have the comfort and aesthetic pleasure of the new and are again not subject to mechanical repair costs or time lost in dealing with same. And, we once again are free from threat of being stranded and get a couple of miles better per gallon. (Plus we drove away with full tanks) --- Net change on monthly premiums; minus $60.00
One loan @ 12% became a lease at 6.9% the other @ 9% became a lease $7.2%. There was also the fact that any husband and wife tag-team of self respecting Forum members can rake a car salesmen over the coals.
Interesting, Gold is up +$0.20, Silver up 3 cents, Platinum is up $6.00, and Palladium is up $40.00 � passing through $1100.00/oz. Market futures are down, USD down, and other currencies are mixed. Maybe an interesting Friday is in store.
You have stated a key Truth. An even more important aspect is that said people
indeed *have*/*hoard* great quantities of shiny Gold things. And they obtain
even more, via the methods you will soon learn here, at a whopping discount.
*auspec (1/25/2001; 6:53:48MT - usagold.com msg#: 46413)
[quote]
With increased profits from oil, opium, and other drugs we then get a decreased price of gold. Somehow there is a greater supply of gold on market because of this and we are obviously dealing in the undermarkets. Maybe gold has come to market in exchange for these items giving increased gold supply to suppress POG. So these gents can make so much money in the 3 O's that they will divest themselves of their Au. Is that a Bingo?
[unquote]
You too, have stated a key Truth. Especially the inverse relationship of POG vs
PFOil + PFOpium + PFOtherDrugs. Let me combine those three terms into a simpler
one we can remember easier: GOOP... Stands for "Gross (as in obscene) Oil and
Opium/OtherDrug Profits". So, in simpler terms, the POG moves reverse of GOOP.
You mention "undermarkets". Somewhat true. But their methods are actually done
in the normal (legal) LBMA and COMEX markets. Some of their cronies are shady
folks, very adept in performing/facilitating for either group, Oil or Drugs.
You are incorrect saying: "they will divest themselves of their Au." (gold).
Indeed, "money" (more of it--fiat) is not their objective. Just the opposite
is true: They already have too much fiat. Their objective is to exchange it all
for more cherished gold. And at the lowest obtainable price. Wouldn't you.?.
Orville Goldenbacher (1/25/2001; 8:46:47MT - usagold.com msg#: 46420)
-and-
Orville Goldenbacher (1/25/2001; 9:15:55MT - usagold.com msg#: 46422)
[snip]
"Take a look at what happened in 1977, a critical year for gold." The Bank of China shocked the gold pundits, and those clever forecasters who are to be found in great numbers in America, by suddenly and without warning, dumping 80 tons of gold on the market."
"That depressed the price of gold in a big hurry. All the experts could say was, "We never knew China had that much gold where could it have come from?" It came from the gold which is paid to China in the Hong Kong Gold Market for large purchases of opium.
[unsnip]
-and-
[snip]
"It is easy to understand why gold was demonetized and substituted with the paper "dollar" as the world's reserve currency. It is not as easy to blackmail a country holding gold reserves as it is one having its reserves in paper dollars."
[unsnip]
The article you posted was lengthy and shows how interwoven and convolouted the
whole nightmare is. Suffice to say, the (opium) trade generates alot of cash
profits, and yields alot of power in high/influential places. Just as does the
obscene profits of the oil exporters. Add them together both wanting to exchange
their illicit (drugs) and legitimate (oil) US$ Profits into their cherished gold
and it becomes easy to see the amounts are staggering, and could move markets
(downward.!) if applied in the right way, with the right timing, and with the
full cooperation of high placed facilitators and unregulating regulators.
Pandagold (1/25/2001; 16:43:24MT - usagold.com msg#: 46464)
[quote]
There has been mention of a link between gold and drugs in one context or another. It would be interesting if you found out who provides the military training and back-up for the top drug barons' protection and general security - also providing intelligence.
I did but it was buried in small print.
(Clue:One of the world's most elite forces)
[unquote]
You of course, are refering to the CIA and US Forces under their surreptuous
control. This is such a shame, and flys in the face of those Veterans who have
or were ready-to give their lives for their country. But orders are orders, and
secrets are secrets, best kept from our unknowing soldiers. How ironic.
auspec (01/25/01; 22:12:25MT - usagold.com msg#: 46490)
[snip]
Putting together my simple premises with the info from Orville G--- Gold is a common currency used in exchange for your 3 O's, and a nice "dark" currency it is. If I sell a lot of O {lets say oil} and make a lot of profit, in gold per cheap dollar terms, then some of that "currency" will find it's way to market. This depresses POG, again in dollar terms, and sets up a cycle where even greater amounts of gold can be had for same Oil. Drives POG down as long as the SUPPLY of Au is available for these transactions. Right?
[unsnip]
Not exactly. They don't "make their profit in gold". They make it in US$ (and
to a very minor degree, EUROs too). It is when they *convert/exchange* those
fiat profits for the real thing (gold), that their method depresses the POG.
It sounds backwards, doesn't it.?. You'd think them purchasing that much
gold on the market would RAISE the POG. It doesn't.!. Because of their clever
tactic of using their previous gold hoards to flood the market(s) temporarily,
then, with exquisite timing, buy it all back, plus the next-wanted quantity,
at (viola.!.) rock bottom ("manipulated") POG prices. Who are the suckers.?.
Next, you (ausepc) go on to reason:
[snip]
Continuing forward, regardless of the absolute correctness of the premises above: What factors will cause a change in profitability of your 3 O's? Oil is quite profitable right now and likely will be for a few more years until pendulum swings back. your other two O's are probably quite profitable right now for at least 2 obvious reasons: Boom times with lots of money sloshing around. The supply is controlled to a degree because of the illegalities of these substances. Cartels, turf wars and so on act on these substances like existing control of diamonds.
So, what busts up this formula for success? 1. Unprofitable oil {look back a couple years} 2. Unprofitable illegal drug trades {have no clue on how that changes except what mentioned above} 3. Back to gold supply problems {if the gold is not there it can't be used in this cycle of trade}. All of this depends on a large flow of "tarnished" gold. That and Oil look like the leading candidates for change in this cycle.
[unsnip]
You are exactly right. Look back, using long-term OIL and Gold charts. The good
times for POG have often coincided with bad (unprofitable) times for OPEC etc.
I differ in your reasoning about drug profit fluctuations. That factor remains
relatively constant (demand/junkyism) or if anything, increases during economic
downturns (it's been proven) because the depressed populace will squander it's
cash on supporting their addictions above nearly anything else. And loss of job
or economic recessions only increase their stress. Or allow them to obtain very
generous alternate (welfare/unemployment) income handouts. Indeed, many states
now lavish welfare upon them, calling their addiction an illness worthy of SSI
payments from the Social Security Trust funds. But that's not the issue here.
I like your reasoning in asking "what busts the cycle?". My answer to that is:
it isn't likely to be busted. (1) because oil is getting scarcer. (2) drug use
cannot be ineptly contained by dubious "DEA War on Drugs". (3) They supply the
initial gold needed to flood/stampede the POG markets downward. Their supply is
endless. And they get it back every time, plus alot more. At a very low price.
To change the cycle, we need to watch for: (1) disintegration of OPEC; or more
supply from non-opec sources to come online in the future; etc. (2) A real cut-
back in drug useage. (ain't gunna happen)(it's just getting worse). (3) CFTC
type regulations to prohibit short-selling of Gold my non-mining producers.
Or other governemnetal actions to thwart their (quasi-legal) manipulations.
=== You Knights have come a long way. Rest your Pony(s) and let them drink in
the creek here for awhile. Then continue your Vision Quest. Soon you will ask
yourselves why you didn't get off the beaten Trail much sooner. For the Truth
of the downtrodden POG has never been discovered correctly nor discussed until
this time. Nor has the answer ever been given of "Who's buying all that gold.?.
Until now.!.
So, you have already learned TWO Answers. In only two days. That's progress.!.
Johannesburg - Harmony, the country's third largest gold producer, would not sacrifice its anti-hedging principles to secure funding for its R1 billion purchase of AngloGold's Elandsrand and Deelkraal mines, Bernard Swanepoel, the chief executive of Harmony, said yesterday. Swanepoel said the company's search for finance to bankroll the acquisition was proceeding well. Intensive negotiations between Absa and JP Morgan-Chase, the two lead banks on the deal, were not unusual in a bid of this size, and he denied the company was battling to raise the cash to fund the purchase. "We still have no finalised details with regards to the financing in terms of terms and interest rates. "Harmony has stated that it is opposed to forward selling and capping shareholder exposure to the gold price. Banks have to ensure that loans are secured, and what better way to ensure that than through sustainable profitability?" Swanepoel said Harmony would not renege on its anti-hedging philosophy, which set it apart from other gold stocks until 1999, when Gold Fields followed by winding up its own hedges. "We would rather not do deals which would force us not to give our shareholders the same exposure to the gold price E we won't sell our souls to get the financing for one deal." One analyst said Harmony was expected to buy put options on its gold production from the new mines to satisfy the risk requirements of its financiers. That would give Harmony full exposure to any upside in the gold price, but protect it from a price drop. Swanepoel said the final details on the finance package would be released next week.
Black Blade: Looks as if I'll keep my Harmony shares afterall. Honesty in a Gold Miner - Go Figure! I was skeptical of some reports that they would hedge, they would've lost their US base of shareholder support. Rather an unhedged profitable miner with a few mines, than a hedged short-seller behemoth with a lot of mines.
http://www.usagold.com/goldtrail/default.htmlThis tack you have taken is exceptional, my friend! When it has proven futile to get someone to poperly conceptualize the unseen nature of the foundation (soil, strata, bedrock) upon which he stands admiring his landscape with thoughts of building a house here or there, your latest effort shall prove to exceed previous (herculean) attempts at showing core samples and diagrams of geologic cross sections.
As for myself, I have often had a laugh at my own experience, saying to friends that judging from my inability to lead others along a simple line of my own thought, I would likely prove unable to lead a three-year-old by hand to the toilet. But now, in splendid contrast to *ALL* my past efforts from The Tower, you have embarked on offering a hand-held tour through all of "geologic time" (to extend the above-mentioned metaphor) to offer a direct view of the foundational bedrock and strata as it developed.
In this way you are replacing a person's grey concept of "history" with a more vivid and vital understanding of the same old events in meaningful terms of current life experience, as in "been there, done that!" You have placed real items of antiquity in their hands as they stood upon the old earth, and asked importantly of them, "What would YOU do in these shoes?"
Yes, from humble beginings, all roads do lead to gold...though my inartful instructions shall surely doom me (as a traveler) to a solitary walk getting there, bewildering all and three-year-olds despite my best efforts! ha ha! Though through your good "trail guidance", legions may have hope to more clearly steer the course. And I, a mere curiosity to the woodland creatures, I shall be the tall one leisurely bringing up the distant rear, having already packed heavy in anticipation for the inevitable destination.
Posted: 2001/01/26 03:37 AM EST
Why gold failed to rally amid US dollar weakness
The gold price ended up $2.20 on January 22 as a report by the US Commodities Futures Trading Commission (CFTC) revealed that a short position in the futures market had been created, possibly with the intent to buy physical gold during Tuesday's gold auction by the Bank of England.
The idea is that a speculator can sell futures contracts in gold and cover them by buying physical gold at the auction and delivering it against the futures contract obligation. The problem arose when it appeared that more gold was short than the Bank of England was going to auction, and so a short squeeze rally ensued.
If this is really the case, we should see the gold price remain strong for a few days and then drift back down again, all else being equal. You may ask yourself why on earth I am writing about this, since a short rally is really a non-event, unless of course you're short.
The reason is that the gold price failed to rally since the last week of November, while the dollar has declined by about 11% against the euro. This has surprised some, because in principal at least, the gold price should respond to weakness in the US dollar. The theory is that because gold is priced in US dollars, any weakness in the US dollar should cause an increase in the US dollar gold price as long as the international gold price remains relatively constant.
So why didn't the gold price increase in relation to the dollar's decline? Well, there are two possible reasons. First of all, it is possible that while the declining dollar put upward pressure on the gold price, there may have been physical selling of gold, which of course would tend to lower the gold price.
According the World Gold Council, "statistics released by the London Bullion Market Association show that a sharp upturn in gold market activity occurred during the last month of 2000. Net clearing figures for December jumped to the highest level for six months, increasing from a daily average 18.6 million ounces (578.5 tonnes) in November to 23.6 million ounces (734.0 tonnes)".
This indicates that there may well have been strong selling of physical gold. Also, the short increase in gold futures contracts as reported by the CFTC might also imply physical selling of gold, which could explain why the gold price did not increase while the dollar weakened.
But there is another explanation. It is true that the dollar weakened against the euro, but that may not necessarily mean that the dollar weakened against other currencies. It could also be that the euro strengthened against most currencies and that would imply that the US gold price should not have been expected to increase.
While the euro gained 12% against the dollar, it also gained 20% against the yen. During this time, the dollar gained 7% against the yen. The point is that although the gold price is inversely correlated to the dollar exchange rate, one also has to look at the dollar against a basket of foreign currencies. Just picking the currency of the week is going to result in confusion and misleading conclusions.
The dollar has not yet declined in any meaningful way against the majority of foreign currencies, which is why the gold price has not had a significant rally. Since its inception, the euro has been a disaster and the recent strength in the euro against the dollar of late is a reflection of the euro, not the dollar. We have to keep our eyes on the dollar in order to make sense of the dollar denominated gold price.
My money is still on an eventual decline in the dollar of historical proportions that should result in a substantial increase in the dollar denominated gold price. I see no reason to change that or any evidence that a decline in the dollar can be avoided.
By: Paul van Eeden
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Gold's "only saviour" is investment demand - GFMS report
Well, they are in on it, ( merely because the CIA have their finger in every sordid little pie) but not the BIG culprits - no, and it's not the Ruskies, or the Brits. (or the Chinese) don't leave much does it? But let them remain nameless within these pages, at least. They are now the only 'untouchable'.
I know we are not to promote in this facility, at least, I suppose without declaring a personal vested interest.
Well I am not telling anyone to rush out and buy their shares, but if you have them , HANG ON. This company is one of the most 'above board', play it clean and go ahead companies in the market - and not just in the mining sector.
They put their money where their mouth is, and believe in their product - OUR product.
Not a propmotion - just interesting comment from a CEO
Once again THIS IS NOT A PROMOTION
I print post this part of an interview with the ceo of
Vista just to illustrate (see towards the end) how the share price of a comany can be so unrelated to its performance. I would find it diffficult myself to invest my hard earned cash in such a low price stock. But if he is telling the truth, and there is no reason to doubt him as the figures could so eaily be checked, it show the state the industry has got into with all the sh*t that it has had to take for more at least a decade.
McGregor is the CEO of VISTA
Mr. McGregor: "........When gold prices start to move up, the price of the major gold producers such as Newmont and Barrick move first. Then the intermediates start to move up, and then the junior gold stocks. The percentage change in stock price is usually significantly greater with the juniors because they are so undervalued, and they're also highly leveraged to the price of gold. So I think that investors who would be interested in speculating with a few percent of their portfolios should be interested in our company. When the price of gold goes up our share price is likely to increase quite dramatically because Vista Gold and the junior gold sector as a whole is currently so undervalued The gold industry, worldwide, is really very small so even a switch of a few percent of people's investment portfolios into gold or gold stocks would have a huge impact on the price. This could happen quite quickly as people look around for undervalued sectors of the market. To illustrate this point, in mid-1996 when gold was around $375 an ounce Vista's stock adjusted for subsequent issues was trading at around $1.08. Today, with gold around $270 an ounce Vista shares are trading at around $0.06 and our gold reserves are better than they were in 1996. Great leverage to gold price!"
< For Homestake Mining Co. (HM), temporary power outages have forced temporary closures, some as long as 10 hours, of its 120,000-ounce-per-year McLaughlin mine in Napa County, raising the cost of production there by $10 an ounce.
Homestake CEO Jack Thompson said that under the mine's power agreement, it enjoyed a lower kilowatt hour charge but gave its provider the right interrupt its electricity.
"It's just been frustrating to try and keep running and you get a phone call that says 'You've got to shut down in five minutes'," he said. "But we struggled and kept everybody on the payroll -- we've got 135 people there. We try to do maintenance and things like this until we get the power back.">>
HYDROCARBON MAN REVISITED - ENERGY CRISIS - "THE PERFECT STORM"
CALIFORNIA ENERGY CRISIS
The energy crisis continues to spread across the US with ever increasing severity. It was not long ago that the Wall Street pundits such as Abbey Joseph Cohen of Goldman Sachs said that energy was not a concern as it was not an important part of the economy anymore. Furthermore, there is the "New Economy" and that any concerns about a failing energy grid are "overblown." To paraphrase the Church Lady - "Well isn't that special." Try to pass that explanation onto the citizenry of California who have recently suffered the indignity of third world energy woes as rolling blackouts surged throughout the northern portion of the state. This energy crisis is far from over.
Recently PG&E found itself unable to provide power to its customers in Silicon Valley, the epicenter of the High Tech world. Power prices have increased 10 fold with utilities scrambling to find power at any cost while they deplete their cash reserves. Both PG&E and Edison are in technical default as they found themselves unable to service their debt. Now many Silicon Valley firms have installed their own power stations in order to ensure that they may stay in business. One High Tech manufacturer recently lost $1 million per hour in June when the power went out for 3 hours. Most of these companies had lower rates because they were on a voluntary list of power users who agreed to accept loss of power in times of a stage 3 power alert. The yearly limit on voluntary power depravation had been used up in the first 3 weeks of January!
How did California, the world's sixth largest economy, come to be on par with most third world countries? Quite simply, it was the typical California Grasshopper mentality that no one has to be responsible for anything. California legislators went haphazardly into partial deregulation where prices would be capped for consumers, wholesale energy prices were fully exposed to the free market, and worse yet - no long term contracts were allowed to lock in low energy prices. That's not all. There is a long standing tradition of beggar thy neighbor and a "not in my backyard" syndrome that pervades California. Environmental restrictions in California prevented the construction of new power plants that would be required to replace deteriorating older plants. In fact, no new power plants were constructed in over 20 years!
Unfortunately several events coincided that created a "Perfect Storm" in the energy crisis. Not only was this crisis inevitable because of lack of planning, but other states were also growing and demand for power was also increasing elsewhere. In California, most communities did not want "unsightly" polluting power plants built anywhere near them. Only clean burning natural gas power plants were acceptable, and better that they be built out of state. The result was that there are few "dual-fuel" power generating facilities, and that natural gas production could not keep up with ever increasing demand. In the Pacific northwest, hydroelectric power generating facilities were strained as drought conditions lowered water levels and therefore power output was lower. Washington and Oregon had to take care of their own first and what was left over could be sold to Californian utilities. The politically correct Grasshopper crowd of California assumed that they could forever be consumers while other states could be the providers. Sometimes shock-treatment is the only cure.
AN AMERICAN NIGHTMARE
California isn't the only crisis center, though so far it is the most visible. The cool summer this past year in the northeast prevented power shortages similar to that in California. In fact, the White House set aside 2 million barrels for heating oil for the northeast. Albeit, that oil was a political bone thrown by Bill Clinton in an effort to help Al Gore in his bid for the presidency. That oil went to Europe and never surfaced in the northeast. The midwest is perilously close to an energy crisis as well. The reason? Under utility regulation there was little or no incentive to build up energy capacity since profits were constant and rates were capped. Not to mention that regulators had forced utilities to write off construction costs that resulted in dividend cuts.
The situation isn't much better on the east coast either. Rate hikes are up about 43% in New York City with warnings that rates could increase by another 30%. The local utility Con Edison said that future energy demands might not be met unless additional power generating facilities are built within the next 2 years. So perhaps you now understand why I say that this is still a "developing" energy crisis. Recently there have been protests in Chicago, San Antonio, and several other US cities over the high cost of energy. Just imagine the societal breakdown when the grid goes down for extended periods, especially at night in major urban areas. Just look at what happens when a professional sports team wins a nation championship and the loons run amuck rioting, burning, raping, killing, etc. The nightmare of Y2K could be upon us but not because of embedded computer chips, but rather the complacency of man, misplaced environmental concerns and a simple lack of planning.
POWER GENERATION
POLITICALLY INCORRECT POWER
Over the years, many older power plants have shutdown as they had deteriorated from use. Many had shutdown as the clamor over nuclear power increased due to events such as 3 mile Island, Chernobyl, and hysteria aggravated by movies such as "China Syndrome." As the energy crisis intensifies, oppose to nuclear power will diminish. Some power plants such as hydroelectric power dams cut back as water was released to accommodate fish runs on several US rivers. New coal burning plants have not been built while technology for cleaner burning coal technology is being researched. The EPA Clean Air Act had an effect as well. Carbon Credits (also known as pollution credits) were awarded that limited the amount of power generated. Once a power plant reached it's allotted pollution limit, it closed until the next year, or purchased credits from other facilities. Oil burning power plants suffer from the same problem. Even though world oil consumption is roughly 77 million barrels per day, producers and refiners are at near capacity. While production increased about 10%, the demand has increased over 35%. As a result, about 95% of all new power generating facilities will be natural gas fired.
LOW SULFUR COAL
The largest source of low sulfur coal outside of the Lippo Bank owned coal deposits in Indonesia are in the newly designated Escalante-Staircase National Monument in the state of Utah. Some speculate that there was a Quid Pro Quo arrangement with campaign contributions for Bill Clinton and Al Gore and the NP designation. The fact that Clinton-Gore came in third place behind Ross Perot in both the 1992 and 1996 presidential elections in Utah did not help. Low sulfur coal is predominantly found in the western states, whereas the coal in the eastern states is higher in sulfur content. The concern over acid rain has created a politically charged negative sentiment against high sulfur coal. The race is on to develop cost effective clean burning coal technology.
NATURAL GAS
Today less than 20% of all power is generated by natural gas. That will increase to over 50% by 2010. Power demand had increased at an annual 2% clip for most the last decade, yet that rate has roughly increased to the current 4%. The reason? Simple - the "New Economy." In other words - the "Perfect Storm" caused by runaway demand, limited and even declining power generating capacity, and you have the perfect recipe for blackouts, rate hikes, and a declining comfort level in everyone's life-style. In other words, a potential disaster of epic proportions and societal deterioration. At the current rate of consumption, the US will consume its natural gas supply in about 66 years. As demand increases, that rate of consumption will increase significantly. Also, once the producing zone is depressurized to a certain point, other methods are required to force out the remaining natural gas. The use of other gases to displace the natural gas could cause contamination and eventually the energy cost to remove the gas is greater than the cost benefit. Due to increasing demand for clean energy, and the construction of many more natural gas fired power plants, the US natural gas reserves could be effectively depleted in as few as perhaps 20 years.
Natural gas will have to be only a part of the solution. General Electric (GE) is the major manufacturer of natural gas fired turbines. There is a problem here of course. The problem is that they are currently backlogged for 3 years. Even if there were enough turbines, there is the problem of natural gas production. Most target areas that are likely to have natural gas are in areas that are either populated (not good), or in isolated uninhabited areas that are usually off-limits due to government ownership. That is not only limited to natural gas of course.
There are not enough drill rigs, experienced rig crews, or professional staff to explore and produce enough natural gas anyway. Some drilling companies are scouring junkyards to find enough scraps to piece together drill rigs. Felons are hired upon release from prison to train on drill crews. How did this happen? Simple, when petroleum prices crashed in the 1980's, drill rig manufacturers went out of business or into other businesses. Old drill rigs were expensive to maintain and several if not most were sold as scrap to junk yards. Experienced drill crews and professional staff were thrown out of work and eventually most moved on to other careers, never to return. As it is, today most operating drill rigs are in use, and no new rigs are to be found. In fact, day-rates for drill rigs have been increasing again as they have during the petroleum boom times during the Arab oil embargo of 1973, and energy crisis of 1979.
RENEWABLE ENERGY
What about wind and solar power? Both are climate dependent and costs are generally higher, though with increasing energy costs there is potential. Unfortunately while some environmentalist cheer on the development of these energy sources, others are opposed. The loss of "open-space", and loss of "aesthetic value" are listed as concerns. Animal rights activists tend to oppose them as "animal killers" , especially windmills as they have been known to slice and dice birds such as eagles, condors, etc. Hydrothermal power has potential though there are few source areas outside of places such as Yellowstone National Park, and building a power plant over "Old Faithful" would not likely go over well with the Forest Service.
THE NEW ECONOMY
There are enough demands on energy as it is. Power demand nearly took out the grid in the midwest last summer as air conditioning strained the available capacity. The "New Economy" has hit the power grid hard as well. As more people "plug-in" to the internet, more power is drawn upon by computers, server farms, and phone use. Demand is projected to increase at about 4% annually. If the energy crisis hits the grid, then online businesses such as Amazon.com and others will suffer. Energy use is actually rising exponentially due to the use of the internet and computers in just about anything imaginable. In fact electricity consumption has increased by 35% in the last decade. Of course higher energy use leads to higher energy costs that MUST and WILL be passed along the consumer. The result is inflation.
CONCLUSION
The energy crisis is already upon us. The situation is beyond repair and recession is the only result. The lack of preparation and artificially low energy costs fueled by cheap oil and natural gas have lead the US to an unprecedented Bull Market, but has also lulled the US into complacency. The US was "asleep at the wheel" and the economy is about to careen out of control. There is no way to prevent it at this point and recession is inevitable. Inflation and more likely stagflation will be the result. Why do I say this? Simple, every postwar recession has been preceded by rising energy costs. The only difference this time is that it is electricity and that hits the manufacturing sector as well as the consumer. Energy is one of the necessities of modern life. Those who prepared for Y2K are going to fare better than most, though life will likely become uncomfortable regardless. Job losses will accelerate, starting in the manufacturing and retail sectors. Wealth preservation will be the order of the day, while many bemoan losses on the stock market exchanges while they endlessly chase the current hot fad or run for the exit with the other panicked masses, those who have hard assets such as precious metals and real estate and who have a prepared a store of the necessities of life such as water and food should do much better and weather the "Perfect Storm."
By Thom Calandra, FT MarketWatch.com
Last Update: 5:15 AM ET Jan 26, 2001
LONDON (FTMW) -- Gold fund managers are lining up behind gold, with some suggesting the besieged metal might make a comeback.
The Bank of England's 25-ton gold auction this week, one of a series of gold sales by central banks worldwide, was 4.8 times oversubscribed, pointing to a widening gap between physical supplies and consumer demand.
"That tells you people are buying. There is a big demand for gold in the spot market," said John Hathaway, who manages the $20 million Tocqueville Gold Fund (TGLDX: news, msgs) from New York City. Hathaway said rising demand for gold could lead to a rare backwardation of gold prices. That's when the price of an ounce of gold for sale today is worth more than a contract for future delivery of the metal.
"To me it is a question of when gold moves higher, not if," says Joe Foster, manager of the $100 million Van Eck International Investor's Gold Fund.
A recent Salomon Smith Barney report, citing a gold industry trade group, said the deficit between physical supplies and growing consumer demand for the cheap bullion could be as high as 25 percent. Gold sells for about $265 an ounce, close to its lowest point in 16 months and not far from a 20-year low.
Critics point to forward-hedging gold companies as the culprits behind a low gold price. The world's No. 1 producer, Anglogold of South Africa (AU: news, msgs) , and Canada's Placer Dome Gold (PDG: news, msgs) and Barrick Gold (ABX: news, msgs) each sell their future production to dealers, getting more for their gold than they could in the spot market.
The so-called hedging tends to depress gold prices, in part from the use of derivatives. The hedging also encourages central banks to lend their gold at increasingly lower interest rates, once again putting a lid on speculators' willingness to bid the price of gold higher.
"Excessive hedging is damaging to the gold price because it supports central bank lending, contributing to the negative attitude that most investors have toward gold," says Foster at Van Eck.
Foster says gold companies that continue to hedge their production are gaining higher prices but playing a risky game. If gold prices rise significantly and rapidly, a mining company with an aggressive hedging book could be forced to sell its gold at a price that is far below the current market price.
"I would be more lenient in my views toward hedging at significantly higher prices, but with gold hovering near its 20-year lows, this isn't rocket science," he says from New York City. "It makes absolutely no sense."
'Not a clue'
Placer Dome Gold of Vancouver, which hedges gold production, told investors this week that the low gold price has led it to reduce the price it sets for gold reserves on the balance sheet to $300 an ounce from $325. The gold mining company, which produces 3 million ounces a year, cited central bank sales and, curiously, weak demand. Placer Dome made no mention of the oversubscribed Bank of England gold sale.
"With all due respect to Placer management, they don't have a clue," said Hathaway at Tocqueville. "They don't have any special insights that are not available to the rest of us. This has been a five-year death march for gold, and Placer Dome is trying to preserve capital."
Hathaway says he likens the "death march" to natural gas prices, which languished for years as producers cut their activity and decreased their investments in pipelines, exploration equipment and other capital expenditures. In the past year, natural gas prices in the United States have just about quadrupled.
"This year we have crossed a threshold; the psychology has changed dramatically," Hathaway reasons. "The capital investment flows into the material sectors have been really choked off the past five or six years. The previous generation of (natural-resource) managers over-invested and got lousy returns, and the next generation said, 'I am not going to overproduce,' and it is exacerbated by the strong dollar."
Most gold believers point to the financial landscape when making the case for the metal, which tends to rise in times of accelerated inflation or fiscal crisis. Yet gold prices have benefited little from the technology sell-off, a horrendous American trade deficit and signs the U.S. Federal Reserve will be unable to prevent a recession.
"Looking at the macro-economic environment, many indicators are trending to levels of past recessions," said Foster at Van Eck. "Manufacturing activity, debt levels, current account balances, the technology bust, energy prices -- the stage is set. The only thing that has not yet changed is investors' attitude. The Fed will have difficulty combating the excesses that have built over the past 10 years, and when this becomes obvious, gold will move into the spotlight."
Pull the trigger
Adds Hathaway, "We have been exporting capital and importing goods and services. If those flows reverse because foreign goods become too expensive, and the dollar goes way down, then this whole idea of outsourcing to Mexico and Asia for assembly and re-export becomes a bad idea, just like the California utilities getting rid of their power generators."
What's the trigger for a higher gold price? One fund manager in London, who asked to remain unnamed, noted that the Bank of England is halfway through its programmed sale of gold reserves and could decide to end the auctions if regulators anticipate a higher gold price.
"A sharp, sustained rise in the gold price combined with a withdrawal of gold liquidity from the market by the central banks could create problems for the hedged producers," said Foster at Van Eck.
As for investment choices, Foster said he owns shares of Goldfields (GOLD: news, msgs) , the second-largest South African producer after Anglogold. "I believe Goldfields is the most underrated gold company on the planet. Their operations are undergoing vast improvements and they have an impeccable balance sheet," he said.
Hathaway at Tocqueville also owns shares of Goldfields and recommends Homestake Mining (HM: news, msgs) , a California company and fourth-largest North American gold miner, and Harmony Gold Mining (HGMCY: news, msgs) , another South African company. All are considered unhedged producers of gold.
Editor's note: Thom Calandra owns shares of Goldfields. Here are his recent articles on gold and gold-mining stocks:
Gold's fading allure
Former gold trader sees rally ahead
Gold talk brings out the pundits
Thom Calandra is editor-in-chief of FTMarketWatch.com and CBS MarketWatch.com.
Sir Thaigold not know Sir Turkey very well. He think Turkey dumb like other woodland creature. He not know old saying about turkey and a deer...A deer think every man is a stump, and a turkey think every stump is a man.
Sir Thaidoberman can fly?
I have reprinted a key section which I think says a lot.
It is the UK elections almost certainly now in March, otr thereabouts. The existing government is taking some stick for one reason and another. It could well be that their fear for re-election will surpass their obedience to the Cabal/ In other words they could announce no more auctions.
The announcement would be sudden. Think of the impact. Come to think of it, if the manipulators are looking for a way off the hook - what better. The UK will then carry the a lot of the blame for depressing the gold price.
After all, it is getting very embarrassing with palladium and platinum soaring. Watch for them coming down a bit if gold and silver moves. The two lots should move to meet. Silver is the clue, I believe it will move , a little, at first.
"............... What's the trigger for a higher gold price? One fund manager in London, who asked to remain unnamed, noted that the Bank of England is halfway through its programmed sale of gold reserves and could decide to end the auctions if regulators anticipate a higher gold price.
"A sharp, sustained rise in the gold price combined with a withdrawal of gold liquidity from the market by the central banks could create problems for the hedged producers," said Foster at Van Eck........"
May I remind you all, once again, that the euro only becomes a 'tangible' currency in January next year. I have a very strong feeling it will be celebrated by some gold coinage from France and Germany - maybe Ireland (land of the little Leprachauns) will also get in on the act.
All when other things are coming together for gold. I really don't think we need a world disaster ( though we might get one) for gold to move.
Every dog has its day - so they say. And what a dog it's been. Wuf..wuf.......wuf
Thank you for a most excellent summation. You do not mention fuel cell technology. Are you entirely skeptical of FCT? Also, your comments about the 80's are right on. I worked in an industry closely allied to the oilpatch at that time. I can still remember all the bankruptcies and rusting equipment strewn all over East Texas, West Texas and Lousiana.
If I might offer a couple of minor contributing factors based upon my own observations:
1.) New Home Construction especially in the 3000 sqft range and above
2.) The density of continued development in certain parts of the country--e.g., Florida is a good example that comes to mind. Did you know that a desalinization plant is underway or at least planned for the Tampa-St. Pete area?
Attn: Christopher (01/26/01; 07:01:38MT - usagold.com msg#: 46515)I had always heard /been told/ that Turkeys cannot fly.
Whereas, I'm sure my Doberman can fly. Else how does he
get over a six-foot fence.?.
I think, the main point to consider is, simply: Which of the two
can run fastest, and which has the biggest jaws.
I think that Fuel Cell technology has possibilities. As of yet, there are many competing companies and no set standards. Ballard Power, Fuel Cell, and Plug Power seem to be the leaders so far among the independents, yet Exxon-Mobil, Texaco, and GM are also working on Fuel Cell technology. It does look like a promising field though, however, the energy crisis will arrive full force long before a mass-produced and standardized product is available for the masses at a reasonable price. I also wonder with the high cost of PGMs, whether Fuel Cells will be available for a reasonable cost as platinum is a very important element and would surely rise exponentially if Fuel Cell technology becomes desiable. Another question is what type of fuel will be used. Most proposed fuels are "hydrocarbons" and that brings us back to square one. If some method of electrolysis using water can be made viable, then maybe it will be more promising. I also didn't go into micro-turbines as they also look good and they can run on multiple fuel types, but the cost is a bit prohibitive for most people.
Desalination is an interesting subject as well. I know that in Saudi and Marin County, Kalifornia there are operating plants. The US Navy had a small personnel version made as a part of a survival package.
Your post reminds me of an old television episode from a 1970's sitcom called WKRP Cincinnati where as part of a publicity campaign during Thanksgiving, the DJ Johnny Fever, was tossing turkeys out of a helicopter into a shopping mall parking lot. Les Nessman (the newsman), who was horrified, reported the event and was describing how turkeys were cratering into windshields of parked cars and splattering on pavement. Later, Johnny Fever said, "I swear, I thought turkeys could fly!"
Wild Turkeys (not your Thanksgiving kind) can "sorta" fly. ie:
they flap their wings and skitter away about 3 feet above the
ground, for maybe a distance of 10 yards before having a
Greenspan Landing. Then they do it again. Over and over. Just
like Greenspan. But that's where my Doberman has advantage
because he's over three feet tall. He just runs alongside them,
and looks down upon them in flight. Then the jaws. No contest.!.
I have always had my doubts about FCT. I will not ride in any vehicle utilizing hydrogen under pressure. Hindenberg and Challenger come to mind. I put FCT in the same ballpark with the ceramic aircraft engine for which I've been waiting over 20 years.
The most promising, bizarre, and hilarious concept that I have heard of recently is out of France. I laughed at the concept until I saw the thing in operation! It in no way degrades the environment through its operation. It runs off of the temperature differential created by the onboard compressed air mixing with the outside air for "combustion". It is inherently light weight and if it ever experiences a fuel shortage, we'll all be dead anyway! The range is limited as it is in its infancy, as well as its lack of acceleration. It is relatively loud, sounds like a large lawn mower! They have much work to do to improve it, but safety, utility, tree hugger and $$$$ COST concerns are potentially all within its ability. The prototypes are now being evaluated as taxis in Paris.
The name of this technology escapes me at the moment, as well as the name of the inventor. I hope one of the many erudite posters on this forum will post both. Thanks!
BB - Thank you again for excellent grasp and timely and early warnings on the energy situation and as you've said to CM - yes there are alternatives, I would like to add it may take more than a generation (no, not power generation...) to change todays infrastructure in all walks of (energy) life. Judging from the 70's oil shocks, nothing of consequence will be done, only this time we're closer to
the zenith of the Hubbert curve ...
oh well, we can always surf - instead - or plant some veggies and trees to fill our tummy and not to freeze, when even the turkeys won't fly then it's time get some more gold to please - our souls - and take care of our needs, when all else runs a'foul. cb2
Have been to those offices. Also I visited a big gold diplay at the BofE put on by Rothschild a couple of years back. Even came back with a piece of ore. (they stopeed me taking a couple of bars)
Have also panned for gold in Georgia.
I also metal detect. Have found Roman coins but not gold ones yet.
The acutual 'City' of London is only a mile square. One gets a wonderful feeling of being at the heart of financial history - especially Gold when walking those streets. I have to go their as my bank is in Threadneedle Street - no not the BofE but the Bank of Scotland.
Thanks for the thought. Keep smiling. Our day will come - sooner than we think.
Wild turkeys in the midwest are excellent flyers! Having startled more than a few solitary toms in my time, 3 feet altitude is one sad turkey! In the woods they will fly nearly straight up, 20 - 30 feet, before heading off in their chosen direction, losing about 10 feet altitude in order to pick up speed, then flying off amazingly fast and agile for a bird of such great size and TASTE! No question about it. Wild turkey for lunch! (The bird not the libation!)
Hi ThaiGold. You know them wild turkeys are an interesting bird. They can fly. This last spring I had a turkey coming right in to me but I got over excited and shot to soon. You should have seen him. He took off like a helicopter and did a roll over just like the space shuttle and flew about a half mile before he landed. And he was about 30 yards high. He glided almost half the way. And them wild turkeys can really run. Thee ole domerman isn't going to catch him either. A couple of years ago I had a turkey coming in to me but I twiched and he saw me. His eyes got as big as dish plates and you should have seen him turn and run. He was a couple hundreds yards before he slowed down and I could still see his eyes. He knew danger when he saw it.
Now thats a little different than your average stock invester. Yes the ole stock invester can't see danger he just keeps coming in for the slaughter. I just betch ya if a wild turkey could by gold he'd buy all he could get at these prices and think everyone else was dumb for not getting on the band wagon.
Attn: Stocks, Lies, and Ticker Tape (01/26/01; 08:23:29MT - usagold.com msg#: 46528)Hi S,L,a,T.T.
I was speaking of Gold. The Turkey that Cannot fly. Of course
I can see that any turkey can fly above 15-foot midwest corn
stalks. But out here, in the forest, the Evergreens are so thick and their lower branches very close to the ground. Hence our
Wild Turkeys keep their flight path low to clear them. I'm not
sure what Silver is trying to fly under.
Pandagold:
City of London only a mile square.?. EagleRanch is bigger.!.
Power shortfall threatens New York City economy--study
Thursday January 25, 12:58 PM
EST NEW YORK, Jan 25 (Reuters) - New York City faces a critical deficiency of 2,000 to 3,000 megawatts (MW) of electricity over the next five years that threatens to hurt the city's economy, according to a recent study. One megawatt of electricity provides enough power to light about 1,000 average homes.
Unless immediate action is taken to provide additional supply, New Yorkers could suffer electricity price spikes, brownouts and blackouts that are now plaguing California, according to a report from the New York Building Congress, written with the assistance of business advocacy groups. Consolidated Edison Inc. (ED), which helped write the report, has forecast there would be enough energy supplies to keep the lights on for its three million New York City electric customers this summer if the weather is normal. Con Ed officials, however, were not able to say for sure what would happen if the unexpected -- above-normal temperatures or a breakdown of transmission or generating facilities -- occurs this summer. "I can't say definitively what would happen. It would certainly be a stress on the system. Right now, we think we'll be okay. But, we'll have to gauge each day as it comes," Con Ed spokesman Mike Clendenin told Reuters.
CALIFORNIA CRISIS RAISES CONCERNS IN NEW YORK
The high prices and power outages in California have focused public attention on the need for new power plants and power lines and conservation programs in New York City. In California, price spikes and blackouts are becoming routine as officials deal with electricity supply shortages caused by that state's booming economy and rapid population growth in recent years which was not matched by an increase in generating capacity. New York City also experienced an economic boom and population growth over the past 10 years. That growth increased the demand for electricity by about 1,400 MW over the last decade, again without any significant increase in generating capacity.
The increased demand and flat supplies, when combined with the newly deregulated, competitive wholesale market, has, according to the study, resulted in higher electricity prices, especially during times of high demand like the summer air conditioning season when New York City electric bills rose more than 40 percent. The Congress said it prepared the report to alert the political leaders and New York residents of the urgency of the state's electric supplies.
2001 AND 2002 ARE CRITICAL YEARS
The Congress said the years 2001 and 2002 were the most critical for New York City. The new supply of electricity needed to ensure market stability and reliability, and to meet the projected increase in demand, was estimated in the study to be 1,000 MW in 2001, growing to almost 1,500 MW by 2002. The only immediate potential for additional supply before the summer of 2001 as from the New York Power Authority's (NYPA) plan to install 11 small gas turbines in and around the city. If built, these units would produce about 440 MW of new generation in the city. "The NYPA units will provide a cushion for the city this summer, but they are only a short-term solution," Con Ed's Clendenin said. "We need to build additional generating facilities and we need to get started building them now." The Congress urged the state and city leaders to accelerate the process of permanent, new electric generating capacity in the City, and to encourage conservation and increased use of alternative energy technologies. At this time, however, there are no new generating facilities under construction. To date, 5,500 MW of capacity were proposed by a number of energy generators for the New York City area, but only one of those projects has reached the approved application stage. The formal siting process in New York State, called Article 10, takes about 12 months once a project reaches the application stage, before construction can begin.
The Congress also stressed the need for new technologies and energy conservation solutions, which could save an estimated 500 MW of projected generation need. In criticizing a trend that must be reversed, the Congress said the federal and state governments must increase expenditures for conservation and new technology programs that have been reduced in recent years. Public officials and business leaders must act strongly to convey the message now to all new Yorkers that, without new electricity generation, the city could face higher electricity prices and threatened brownouts and blackouts in the very near future, Congress concluded.
Black Blade: Who needs energy when you have a "New Economy?" HA! Abbey Jo's words ring more hollow with every passing day. And NY is the financial center for the major US stock exchanges � and NASDAQ is entirely a computer trading system. Hmmm� Energy is the key to all this!
THANK YOU! I have been patiently awaiting your tutelage. My pony is still resting as instructed, but cannot help but comment how much larger the LBMA is compared to Comex. It again seems that all roads lead to ...............London.
London AM Fix -vs- PM Fix ... What Happens In Between.?.
Attn: Pandagold (01/26/01; 08:15:54MT - usagold.com msg#: 46527)Pandagold:
Getting serious for a minute: The reason I posted that url to
the London Gold Price Fix explanation, was to pre-educate
some who may be unfamiliar with it. Then I want to ask some
questions, of someone like you, over there, that can give us
the right answers. Because I may not understand it myself.
Question: If they "Fix" the POG (for the LBMA ?) in the AM;
that locks-in the POG for any subsequent trades during the
morning, thru midday, until once again, they "Fix" it for PM,
isn't it then possible for a large gold seller to flood his gold
into the LBMA prior to the AM fix, thus depressing the price
for the next several hours, whilst they buy that gold back, and
buy a few more bars at the same depressed price.?. Then,
by the PM Fix, the POG is reset to a higher value for later
afternoon locked-in POG trading. Which reflects by then, the
distortion (manipulation) by the scurillous MidDay sellers.?.
ie: London seems to me, to be a tailor made opportunity, and
place for the villians to work the GOOP exchange. And the
COMEX is small (Irish) potatos compared to the LBMA. Yet
it too is manipulated, by different accomplices, in a much
more dynamic second by second pricing scheme. Perhaps
the PFD manipulators use the COMEX. And the PFO rats
use the LBMA. Bigger bars for bigger Giants.
California goes on high alert again Just hours after warning was lifted, energy crisis continues
http://www.msnbc.com/msn/512303.aspMSNBC News Services SACRAMENTO, Calif., Jan. 26 � California's power supply fell to dangerously low level again early Friday, just hours after the warning had been lifted for the first time in 11 days.
THE STAGE 3 ALERT, the most serious energy alert that means power reserves are so low that there is a good chance of blackouts, was lifted one minute before midnight Thursday. But the California Independent System Operator, which runs the state power grid, reinstated the Stage 3 alert at 4:32 a.m. PT, and said it would run through midnight Friday. The stage 2 alert that had been in effect from midnight to 4:32 a.m. meant power officials can still order service shut down to customers that have agreed to curtail energy in a crisis. There was no immediate word on why the Stage 3 alert was called. Energy managers had earlier suggested they might even be able to go to a Stage 1 alert later Friday, in which people are simply advised to conserve energy. As Friday began, the biggest threat of the day to most power users appeared to be a heavy winter storm that brought driving rain to San Francisco and several inches of snow to the Sierra Nevada. It knocked out power to more than 40,000 users in Sonoma and Marin counties and parts of the Sierra foothills as it lumbered toward Southern California.
The reinstatement of the alert came as legislators and regulators grappled with solutions to the state's energy crisis, blamed on a deregulation program that went awry. On Thursday, Federal Reserve Chairman Alan Greenspan warned that if the crisis isn't resolved soon, it could cause a ripple effect throughout the U.S. economy that could undermine the nation's decade-long expansion. "It's scarcely credible that you can have a major economic problem in California which does not feed to the rest of the 49 states," Greenspan said in congressional testimony, adding that the crisis could reduce investment in the West, which in turn could shake consumer confidence. He called the situation "a significant problem that this country is going to have to address, and ... rather quickly." System operators, meanwhile, said as many as 1,000 megawatts of electricity � enough to power one million homes � were saved each day this week through conservation.
Last week, in the midst of a record 10 straight days of Stage 3 alerts, power had to be shut off to hundreds of thousands of users across central and northern California on two consecutive days. Many more large users, those who had signed agreements to shut off their power during a shortage in exchange for lower rates, also lost electricity for hours at a time. Representatives of many of them were in San Francisco on Friday to lobby the state Public Utilities Commission to let them out of those agreements. "What we are stuck with is a program that was put together prior to deregulation that makes no sense now," said Phillip L. Doolittle, vice president for finance and administration at the University of Redlands. The school has amassed hundreds of thousands of dollars in penalties by ignoring the agreement and keeping its electricity on to avoid canceling classes. Lawmakers prepared to work through the weekend to find a long-term solution to the crisis. Their attention was on a plan under which California would issue bonds to cover the multibillion-dollar debts of its two biggest electric utilities, Southern California Edison and Pacific Gas and Electric Co. The utilities� customers would pay the money back through recently approved rate increases of between 7 percent and 15 percent, which would be kept in force for more than 10 years.
One of the state's most prominent consumer activists denounced the plan as a bailout. "If that's what they plan to do, they'll have to contend with a rate-payer revolt at the ballot box in 2002," said Harvey Rosenfield of the Foundation for Taxpayer and Consumer Rights. "It's not a bailout," Gov. Gray Davis said. "It accomplishes two purposes: It provides the funding to revitalize the utilities, but it lets ratepayers know they will gain as the utilities gain." In exchange for issuing the revenue bonds, California would be granted long-term options allowing the state to buy low-priced stock in the utilities. If the price were to go up, the state could sell the stock and use the profits to help pay off the bonds. The utilities declined to comment on the proposal. California's two biggest utilities are approximately $12 billion in debt, a situation they blame on the state's 1996 deregulation of the energy industry. Under deregulation they were required to shed their power-generating operations and buy electricity from wholesalers but not allowed to raise rates when prices spiraled upward in a tight market. With electricity in short supply, Edison and PG&E have been forced to buy it at the last minute, sometimes paying as much as $600 a megawatt.
BUSH ALLOWS EASING OF POLLUTION RULES
Meanwhile, President George W. Bush is prepared to let California roll back its air pollution requirements on power plants, administration officials said Thursday. California pollution control officials said environmental restrictions have not interfered in power plants operating at maximum capacity. They said the state already has made some adjustment in air rules � when needed � to keep power flowing and doesn't need a waiver. White House press secretary Ari Fleischer said the administration was "reviewing a number of options" that might be helpful to California which has been reeling under high electricity prices, intermittent blackouts and the threat of utility bankruptcies. He declined to elaborate, saying they were still under review. But other senior officials said one idea was that the Environmental Protection Agency give California a waiver on air pollution standards if requested to ease emission controls from power plants. The administration "would be favorably disposed" to such a request "if that's what they think they need," said Larry Lindsey, the president chief economic adviser. Separately, two senior administration officials said that Bush is expected to raise California's power problems with Mexican President Vicente Fox when the two leaders meet Feb. 16 in an attempt to spur construction of power plants in Baja California. Possible expansion of electricity shipments from Mexico to California also might be discussed, but energy experts said Mexico faces its own growing power demands and likely will not want to expand shipments north. Senior Bush advisers have emphasized all week that there is no "federal panacea" to the California energy crunch and that a solution has to be crafted by state officials. Bush has rejected requests, including from some of California's Republican congressmen, for price controls on wholesale electricity.
POWER SURGE ON SUPER SUNDAY?
State power managers have called on Californians to do everything they can to conserve � even suggesting people planning to watch the Super Bowl do so in groups. TV use is likely to surge during the Baltimore Ravens-New York Giants football game Sunday. Group viewing could ease the burden. Last year's game between the St. Louis Rams and Tennessee Titans was watched by an estimated 8 million viewers in Los Angeles, San Diego, San Francisco and Sacramento. "A lot of people around one set is a lot better than having a lot of sets on," said Patrick Dorinson, an ISO spokesman.
Black Blade: Can you just imagine it? If the power grid goes down during the Super Bowl, then there will definitely be some changes. Remember the "Heidi Game?" ;-)
They just aren't getting any breaks are they? This will eventually show up in consumer inflation and then the CPI and PPI manipulation will be exposed.
This week's money supply numbers are in. M-3 was up $36.7 billion. That brings the 8-week total to $214 billion, or $760.00 for every man, woman and child in America, a rate of growth perhaps never witnessed before in American history.
Last year, even official numbers put U.S. inflation at their highest levels in a decade. This year they will be higher still.
There are many more "crop" turkeys than wild. Crop turkeys have had all the instinct and common sense bred out of them. They are fat, cannot fly, completely dependent upon a handout to eat, and uncontrollably herd into a corner at the slightest provocation (such as a low flying plane), killing many of them in the process. The wild turkey goes it alone, surviving upon instinct and experience, all the while living life on its own terms, creating a legacy to be proud of. The crop turkey is the common stock investor, fed by the media and tax laws, forever dependent, always being herded this way and that..... their final low flying plane is on route and on schedule. I proudly stand as one WILD TURKEY, unabashedly bullish on GOLD!
auspec (01/26/01; 08:59:19MT - usagold.com msg#: 46533)auspec:
[quote]
THANK YOU! I have been patiently awaiting your tutelage. My pony is still resting as instructed, but cannot help but comment how much larger the LBMA is compared to Comex. It again seems that all roads lead to ...............London.
[unquote]
Now. Quickly.!. Mount your Pony. Scout towards London.
Keep a sharp eye cast along the ground. Soon you will see a
path that I have stumbled across. FootSteps. Many of them.
Deep in the soft soil. They are heavily laden with their gold.
Yes. Of giants. Perhaps you will then see for yourself, these
FootSteps, or those of Another Giant. Laden with his Gold
and an even weightier Agenda. They are clear to me. And
look closer: More FootSteps. Of the Lemmings that follow.
I meant "excluding non-volatile mortgage and car payment" as parody of CPI and PPI. I realize any valid index should include all budget items. It is, however, more shocking for some people to see a specific portion of their budget to get a better understanding of why they are going broke. Most people on this forum site are intelligent and don't require budget 101, I mainly intend to use this as exercise for my employees and friends. Thanks for comments .
Interesting analogy. Crop Turkeys (lemming-like masses) following the herd mentality, vs. Wild Turkeys (sovereign individuals) that think and act for themselves. Cool!
MK: In a recent conversation we discusssed how much of what Another revealed in his early dialogues has come to pass. May I suggest, as your time permits, you recap and elaborate on same? Thanks....CM
Re- >>>This week's money supply numbers are in. M-3 was up $36.7 billion. That brings the 8-week total to $214 billion, or $760.00 for every man, woman and child in America, a rate of growth perhaps never witnessed before in American history.<<<
The new car and truck purchase in msg#: 46501 resulted in $11,000 new money supply being issued and $14,000 of existing debt being replaced @ approximately 2.5% lower interest. That and the money brought in by the sale of the trade-ins pays for $ 45,000 (invoice) of production in Japan and Detroit. So, if this is put in play by 1) the loaners of capital receiving a lower rate of return and 2) we have a lower monthly payment; which �Flation is it?
BTW, MSRP for equivalent vehicle and model was +10% over four years for the Ford truck and Five years for the Subaru Legacy
Who Are The Suckers?Per your post #46503: "Not exactly. They don't "make their profit in gold". They make it in US$ (and
to a very minor degree, EUROs too). It is when they *convert/exchange* those
fiat profits for the real thing (gold), that their method depresses the POG.
It sounds backwards, doesn't it.?. You'd think them purchasing that much
gold on the market would RAISE the POG. It doesn't.!. Because of their clever
tactic of using their previous gold hoards to flood the market(s) temporarily,
then, with exquisite timing, buy it all back, plus the next-wanted quantity,
at (viola.!.) rock bottom ("manipulated") POG prices. Who are the suckers.?" END
The "suckers" are basically anyone foolish enough to sell their gold at these artificial prices. This is clearly the spec longs frightened out of the markets, but also includes the miners who are digging up artificially cheap gold for these wise ones. Any small country connived out of their national treasure. Basically all SELLERS! This answers the question also of WHO is buying all this gold.
Vision Quest... Sucker Rallies: NASDAQ; DOW; and Gold
... Different Strokes, by Different Folks ...As you ride your Pony(s) looking for more Truths in your Gold Vision Quest,
let your thoughts wander to the familiar "Sucker Rally". Those legendary
traps of the NASDAQ and DOW manipulators. For in order for something to be
slammed DOWN, by the vicious Shorters, they must first Rally it UP. That
draws in the Suckers. The little guys. The greedy. The Lemmings. For it is
their hard earned Bucks which nourish the Giants. And how are such Rallies
accomplished.?. Simply by a concert of media hype; PR mis-information; and
wishful WordFests. Relentlessly. Works every time. Doesn't it, DotComFools.
Next, consider the frequent miniscule Gold Rallies. Difference is sleight.
(pun intended). To manipulate POG DOWN, they must first manipulate it UP.
But not enough to cause a blowup to their schemes. Just a little rally. A
few bucks. Maybe a week. Maybe a month. Then, when the Suckers have once
again gotten their hopes up and their money in. Whamo.!. Pull the rug out
from under them one more relentless time. After time. After time. How can
so many, be so fooled, so often.?. And so well. Different strokes.?.
It's easy. Just get yourself some clever writers, and preach to the choir.
Anywhere that GoldBugs congregate. For they are all ears. And await eagerly
(and believe wholeheartedly) that which they want to hear. "Gold is going
to the Moon.!. Get you some now. Get more. Look... see it's up a tick. That
20-cent move yesterday is a new Trend. Fasten your seatbelts. Who knows,
it may even skyrocket. To $29,999/oz. Someday".. "Or zero first." Whatever.
There's never a better time to buy Gold. Especially the Paper gold. But you
beware. That's only for the greedy. The unclean. The gambler. The Friend
of the Trend". But you are not so naive. Nor greedy. That's only the other
guys. The Suckers. Who will soon be fleeced. In the next Gold Rally.
So, beware of False Prophets. For they bring upon you, Falser Profits. And
question mildly, their motives; methods; and agendas. For they may not be
what you think them to be. Think for yourself. Would you have another to
choose your Bride.?. Or your Homesite.?. Or your Retirement Savings.?.
These are Truths, that you come here to learn. Open your eyes. In this
Gold Vision Quest. See the light. Study the dropping along the Trail. You
will soon learn, as your experience grows, the nature of the beast. Learn
the difference: Between a Giant; or a Sasquatch. Lemming or Squirrel. It's
up to you.
Thai"Gold"?Hoping to get Another question in while class is still in session? loping ahead a few paces: 1. You don't see the GOOP {GOOOP?} being busted anytime soon. 2. "Their" hoards are large and growing. 3. You go by ThaiGold nevertheless.
Which of these 3 items seems out of place WITHIN THE PARAMETERS SO FAR GIVEN?
It's not ThaiSilver or ThaiEuro or ThaiOil or ThaiNWO. So what is the next piece of the puzzle if I may so inquire?
You have set me a puzzler there - not how to find the answer, but how to explain it. Give me a little time, but the first thing to remember is this- GOLD is NOT just a commodity. It is important to understnad that.
The next thing to understand is - who owns and controls the most gold. Remember 'He (they) who has the gold makes the rules. And I mean - MAKES THE RULES!
Now who would flood the market with gold (or try to?)
There is no one more powerful than those who run the show.
Are you getting there? I believe you are smart to enough to be getting the picture.
The problem with most people is they just can't see BIG enough. We have been programmed to think small.
I am not sure if your question sought an answer or was merely rhetorical, but I would argue that any new money created, regardless of price(interest rate charged), is by definition INflation.
As to the smallish 4 and 5-year increases in vehicle MSRPs, remember, it is only in the past two years that we have seen a reversal in the 18-year disinflationary trend in the United States. 1998, in fact, was marked by a slight annual DEFLATION at the producer price level. (The CPI got very low that year but did not go negative arguably because consumer prices include more services, which do not respond as readily to gains in productivity). Furthermore, strength in the U.S. dollar during 1999 and 2000 subdued the price of the foreign components in those vehicles. This does not mean that higher U.S. productivity has not played a role. It has. But, as good as the productivity gains have been, they are nowhere near enough to sop up the explosion in money supply we are now experiencing.
... Tigers can't change their stripes ... Posting Handles Neither ...auspec (01/26/01; 11:02:46MT - usagold.com msg#: 46547)
auspec:
You ask which is out of place.?. "Thai-gold", the kind they use for jewelry and
money (yes, money) in Thailand, will be forever thus. I admire that stability
and wholesome truthfulness. They are not fooled. They are not suckered. Their
(and most Asian societies) are on a real everyday no nonsense Gold Standard.
To them, POG in Dollars or EUROs matters not a twit. It's how much rice can
you buy for a gram. Or from a single link of a neck chain.
So in that respect, I prefer to keep the handle as is "ThaiGold". Nothing says
it better. But if you force me to change it, I'll take: "ThaiRealEsate". Yes.!.
Misc. monetary monitoring....Fed adds reserves, Treasury buys back own debt, money supply swells
Yesterday, the Fed reported its measurements of the money-supply aggregates...all up nicely. No surprise there to anyone following these pages. TheStranger gave you a glimpse of M-3 in an earlier post. Here is the rest of this limited picture ("limited" because these numbers do not capture all that is looming overseas).
And despite the abundance, the Fed was forced to engage in open market operations to provide additional reserves to the banking system. Yesterday the Fed used overnight repurchase agreements to add $6.75 billion, collateralized by a two-to-one mix of Treasuries and federal agency securities.
Mere patchwork. Today the Fed again jumped in, opting for 6-day repos to provide another $4.0 billion in temporary reserves with a three-to-one mix of Treasuries to agencies involved in the open market operation.
Also in there stirring the pot was the Treasury Department, acting yesterday to buy back $1.0 billion in debt.
Here and on many forums, Gold-eagle, kitcoI+II, etc. many interested people follow
the financial markets and quote the breaking
news and other topics of interest to make
it read by others...
I thought about connecting "US" through an
effective way.. inspired by the gata-egroup... I founded an egroup for "independent
information and news"...
[Bridge] Johannesburg--Jan. 26--About 750 miners were rescued after an earth tremor at the Buffelsfontein mine, belonging to South African gold producer Durban Roodepoort Deep, including an employee earlier thought to be missing, a spokesperson for DRD said Friday. The tremor, measuring up to 3.4 on the Richter scale, occurred at between 1115 local time and 1130 on Thursday, the spokesperson added.
[Bridge] Johannesburg--Jan. 26--Two gold miners died and another was injured in a rockfall after an earth tremor at the Savuka mine Friday morning, according to AngloGold, the owners of the mine. According to an AngloGold statement, the injured miner is in a satisfactory condition in hospital.
Using Randy's and The Stranger's data on M-3, this calculates to a growth rate over 8 weeks at an annualized rate of 21.8%, and over the recent week at an annualized rate of 30.6%. Simply astounding!
Pandagold: "Now who would flood the market with gold (or try to?)
There is no one more powerful than those who run the show.
Are you getting there? I believe you are smart to enough to be getting the picture."
Article:
"SW: Does that mean you're a conservative investor yourself?
"POD: Tech stocks only comprise a small portion of my portfolio. I prefer to fund our expansion with more fungible, recession-proof assets; most of my holdings are in gold, plus some collectible baseball cards. "
I am a professional investment advisor, and have been one for over 23 years. Over the years I have done consistently well by being a contrarion. I was in the business during the last hard asset bull market (late 70's, early 80's), and did very well by fighting consensus and buying dollar denominated assets. After the 1996 election, my contrarion nature led me to gold, and these forums. I have never been more frustrated in my life!
These PM's are clearly not in "markets," but are clearly in "politics." It has become clear to me that you and I are fighting "City Hall," and you know the old saying, "Don't fight City Hall. I have lost many clients who have lost patience with me, and I have lost patience with the lack of discernible free markets in PM's. Your/our information may be correct, but market savy leaves a lot to be desired! Kaplan seems to be the only one with common sense.
Re >>> new money created, regardless of price(interest rate charged), is by definition Inflation. <<<
Increase in money supply exceeding increase in *quantity* of product would be required to have an empirical �inflation' per MS definition; True?
Also, as the cost of credit is the prime factor in money economic rent, I see lower interest rates as a strong and significant DISinflationary component."
Re >>> am not sure if your question sought an answer or was merely rhetorical, <<< Not at all, I see the "Flation" question as the lynchpin of the economic quandary underlying that of Gold. It is my personal "hobby horse" in the ongoing Forum discussion. (Along with political and ethical causes)
Here in The Tower I have had the Consolidated Financial Statement of the Eurosystem (as of 19 January 2001) laying on my desk for the larger part of this week, so I apologize for only now finding time to assemble this summary.
As expected, the gold assets held steady at 118.6 billion euros from the previous reporting week.
Looking to their paper holdings in contrast, the net position in foreign currency assets were in line for another decline (by 0.7 billion euros) due to customer and portfolio transactions by the member Central Banks, but thanks to an increase in their account of receivables from the IMF of nearly 1.4 billion euros, the net change in value of foreign paper held increased by 0.7 billion to 260.9 billion euros.
Wrong my friend,
Can and do, as high as they desire.
Thaidoberman would never get close enough to a wild turkey to do any damage. Their eyesight is phenomenal, they do not miss a trick, nor a dog. These turkeys you are talking about, they don't happen to be white do they?
http://www.newsmax.comNewswoman Andrea Mitchell, wife of Alan Greenspan (Maestro of the Universe) has disputed claims that the White House was trashed eight years ago by outgoing Bush, Sr. staffers. She said that she covered the White House back then, and that no vandalism happened.
Thank you, Ms. Mitchell, for telling the truth in an easily-understood way!
I too remember back around 1996 when after looking at the gold market decided it was due to climb. Accordingly, I bought in and have bought in again and again (you know - all those wonderful buying opportunities). Just like you, my patience has been tested extensively.
I am currently split equally - between metals and equities and equally - between gold and silver.
Hang in there. I believe we can see this thing through and make some money.
"Patience" is the word, all right. But isn't it the ultimate job of the contrarian to figure out when to buck City Hall, as well as the markets?
City Hall has nothing special over the markets but the fiat franchise, and the taxing power over its subjects. Hmmmm, come to think of it, that's a lot!
But eventually, City Hall blows even those advantages. In fact, it is programmed to do so, with almost the regularity, if not the frequency, of markets.
Especially if City Hall is a wholly-owned and -operated subsidiary of players who also operate in the markets. They will use it, then discard it when appropriate. Talk about synergy! (for them)
Calling City Hall's occasional bust-ups requires one to be a "political investment advisor," not just an "investment advisor". I'm sorry, but if that's the game that's going on, then that's what it takes to protect clients' and your own wealth.
If one's survival or future well-being are in the crosshairs, you must put aside identification with your inherited "City Hall" entity, and act as if it means you no good. That's hard, I know. Indoctrination works.
For five years, we have thought like contrarian fundamentalists (of the market type.) We did not learn to think like thieves (too much conscience at work, probably), but we are working hard at it here, in good company.
Peter - That is how I would define inflation, yes, though my dictionary makes no such distinction. For what it is worth, U.S. M-3 growth in 2000 was 9.5%, well above the growth in "quantity of product". In 1999, M-3 growth, as I recall, was close to 11%, more than double the growth in GDP. This explains why last year's CPI and PPI scored their biggest gains in ten years, just as I predicted they would.
Lately, of course, GDP growth has decelerated to 0%, and, as Shermag points out, M-3 growth is exceeding 20%. This is why those who are betting that the slowing economy will temper the inflation threat are dead wrong! Just like last year, real relative growth in the money stock will result in rising prices. Look for a 5%+ PPI by the end of the year.
As many of you know, I have been largely silent over the past month or
so concerning the gold market.
On the one hand, I have been distracted by my own personal/business
affairs; on the other, I have been wary of posting my ideas about gold
at this time as I feel we are entering a very precarious period in the
financial progress of this nation.
However, I received a yesterday today earnestly asking me for my thoughts,
and decided to make a public response.
So let me begin at the beginning...some three years ago, I first
forecast that this nation would move into a period of tremendous
stagflation, the mother of all stagflations, and I made this forecast to
the jeers and derision of many of gold's detractors. In their mind,
stagflation was a "Jimmy Carter" kind of thing, and could never manifest
again in our modern "enlightened" Clintonian age.
Well, I was right (albeit early AGAIN) in my prognostications. The signs are
now evident that a classic stagflation is developing, with surging
sectoral inflations occurring simultaneously with a general economic
slowdown. At the same time, essential commodities (e.g. potable water,
electricity, natural gas, gasoline, platinum palladium, etc.) are moving
into shortage, resulting in rapidly escalating prices.
In Jimmy Carter's day, the response to stagflationary conditions was a RISE in interest rates, in
order to cap demand for these vital commodities, and bring them back
into surplus. In fact, that is the hallmark of most stagflations: rising interest rates occurring in conjunction with slowing growth. THAT is the most notable anomaly of any stagflation, since normally, slowing growth is accompanied by FALLING interest rates.
Rather than respond to stagflation in a "normal" fashion, Al Greenspan is opting for a REDUCTION
in interest rates, resulting in increased aggregate demand...a very
perplexing response given that increased demand is truly the last thing the
government should encourage at a time of vital commodity shortages.
Moreover, a US reduction in interest rates, if not accompanied by
simultaneous interest rate reductions in other countries, ultimately
results in the weakening of the heretofore strong US dollar, the
linchpin of the US financial markets.
The difference in response seems to lie in the biases of the two
respective presidents. Carter was NEVER Wall Street's favorite whore,
and his actions were effected in order to do what is best for Main
Street. On the other hand, Greenspan's entire focus has been doing what
is best for his bullion bank buddies on Wall Street, and if any benefits
flow down to Main Street, well, that's sufficient (and nice) though not necessary.
What will gold/gold stocks do in this Mother of stagflations?
Historically, during the Carter era, gold experienced something in the
order of a 400% explosion in its price, and mostly unhedged gold stocks benefited
accordingly..
However, today, although there are similarities to the Carter period,
there are notable distinctions, and those distinctions will likely
result in something in the order of a 1000% increase in the price of
gold, and an even greater increase in select gold stocks that are primarily
unhedged.
Most of gold's detractors warn that a potential collapse in the bubble
stock markets will harm gold/gold stocks. They posit that
gold will collapse for the following primary reasons:
1) Drop in aggregate demand resulting from collapsed stock and/or bond markets will reduce global demand for gold in jewelry and other industrial uses.
2) Deleveraging of the average investor, corporation, or government will result in panic, emergency sales of stored gold to raise liquidity for debt repayment.
In fact, historically, gold and gold stocks have often dropped in conjunction with a falling stock market, although at the same time, they have been the first assets to rebound strongly after the initial downturn, even while other non-gold assets languish or continue to fall.
HOWEVER, we are facing several aberrations in the gold market today such that history CANNOT serve as a proper guide to gold's future performance during a general stock market/bond market implosion.
These aberrations are as follows:
1) An enormous short position in gold carried by the bullion banks. NO such short position (approx. 10,000 tons, equivalent to almost 4 years of annual global gold production) has ever existed on this enormous scale in the entire history of the gold market. So, if we see a condition of simultaneously collapsing bond and stock markets (plus a collapse in the US Dollar, a phenomenon that may either precipitate or be a consequence of any collapse in US financial markets) then precious metals will likely become the only logical remaining asset to attract any surplus capital in the economy. As wealthy holders of surplus capital move it into precious metals, and furthermore, if the economic turmoil results in a demand for possession of the physical metal, then this will cause a major short squeeze on the heavily short bullion banks who can only be saved by central banks/institutions/individuals releasing abundant quantities of physical gold into the marketplace.
Unfortunately for the gold short bullion banks, most central banks that have desired to sell real physical gold have already seemingly done so, while those that remain gold-holders seem strongly committed to maintaining a minimum hard asset reserve against their currencies. At the same time, after a very lengthy 20 year gold bear market, here in America, we are left today with a relatively small population of individual and instituional gold owners -- one MUCH smaller (on a percentage basis) than existed during the Crash of '29 (when the Gold Standard still existed) or the Carter Era (when the Cold War kept many people invested in US dollar alternatives).
Although no doubt some contemporary gold owners maintain investments in bubble equities and bonds, the mindset of goldbugs and goldbug institutions appears to be "anti-spec" and they appear to lean toward ownership of low pe, low debt hard asset stocks, and short term treasuries or bonds. As a result, any financial panic should result in a very nominal dishoarding of gold assets by both individuals and institutions here in America.
In foreign countries, personal and institutional dishoarding of gold should be fairly subdued, especially if unusual weakness in the US dollar is occurring at the time of any financial storm. With a dropping US dollar, there will be little to no incentive to race to US dollars as a safety haven.
As it stands, central banks, institutions, and individuals hold an aggregate gold stock of some 130,000 tons. They would have to sell almost 10% of that hoard immediately in order to satisfy the bullion banks' current gold short position PLUS feeding gold inventory into the marketplace to appease sudden demands for gold (instead of US dollars) during a US financial storm. Most unlikely!
2) Today gold is an asset in true scarcity, especially relative to the superabundant supply of US dollars in the world. The percentage of the population holding gold, in either individual or institutional form, is much smaller today than any other time in history. As such, gold should adhere to "the Law of Scarcity," that posits that any asset in scarcity (gold) will likely appreciate more and become more valuable over time than the asset in relative abundance (the US dollar).
Overhedged gold stocks (such as Barrick and Anglogold) will present new wrinkles to the current gold market as well. After all, historically, we have never seen gold companies that have hedged several years of future precious metal production at price levels that surely will prove to be too low during any gold price rocket-shot... and so when the gold price suddenly erupts, then one can only presume that various overhedged gold producers will be in big financial trouble, having to deliver massive amounts of gold that they will be forced to buy in the marketplace at whatever price gold commands at the time, instead of having the "convenience" of providing a slow steady delivery from their mines.
Although several collapsing gold mining companies might serve to scare away potential investors, I believe that there will be sufficient numbers of healthy gold companies doing so well during a gold price eruption that any potential stigma to gold mining investment will be overcome immediately.
In conclusion, utilizing the same logic that allowed me to predict correctlly the fast developing stagflation we are seeing in America today, I can safely predict that we are on the verge of a gold/gold stock buy panic that will amaze not only gold's detractors, but also its true believers.
Although such price escalation would most likely result in various governments effecting gold confiscation, price caps, or some other form of gold price suppression, nevertheless, I am willing to bet that there are enough super-wealthy, powerful individuals and institutions now quietly and safely invested in gold who are sure to profit from gold's stratospheric ascent, and they will be able to preclude any inevitable governmental actions to suppress gold long enough to make incredible killings.
Your words: "After the 1996 election, my contrarion nature led me to gold, and these forums. I have never been more frustrated in my life! These PM's are clearly not in "markets," but are clearly in "politics." ...... I have lost many clients who have lost patience with me, and I have lost patience with the lack of discernible free markets in PM's."
I can certainly see where one in your line of work could lose clients in this protracted environment when they are armed with little understanding of the big picture. One of my motivations for posting here is to share my personal view of that "big picture" with others in hopes of building the requisite "understanding" for stress-free participation in these events. You see, I have been fortunate enough through some quirk of fate and determination to sit atop a Tower here which offers a fine view of the horizon in all directions.
I would choose today to describe the big picture with the story of Apollo 13. Imagine being a passenger when the system failure occurred. You originally climbed on board this vessel with enthusiastic thoughts of a trip to the Moon for the sake of forever after enhancing your life on Earth. But now with this unexpected trouble, you find yourself promptly wishing for a direct return to the way things once were, to share the fate of all others "safe" on Earth.
Now imagine that you are not informed (or do not seek to get informed) by those with a good handle on this unfolding mission. Thus with little understanding of the big picture, imagine your increasing anxiety as you see that, instead of promptly reversing course when the planned event was struck by this unforeseen ill fortune, the ship CONTINUES on its trajectory AWAY from safe mother Earth even as conditions deteriorate! Good heavens -- for miles in all directions!
You see, it is better to work within the laws of physics than against them. Having just a little grasp of the big picture allows one to ride this mission out with calm understanding, reaching both the Moon AND a life on Earth -- made better for having endured the whole trip. Anyone who might have panicked at that first sign of trouble would be lost in space. Simple understanding can both keep you calm through the tense parts, and help to guide your own necessary actions to pull you through. NASA does not qualify astronauts for space flight on the sole basis that the astronaut has blind faith. Likewise, you must work to build your client's level of understanding. So roll up your sleeves.
Anyone who thought post-January 1996 showed a great opportunity to buy gold really did not know what they were doing. We had a false breakout in gold after a multi-year basing at the $380 level. Now, yes, I do believe the rally should have continued, but the fact remains that it didn't -- it failed miserably and began a multi-year bear market in gold.
The Asian crises did nothing to help gold's prospects...the dollar was surging as wealth flowed into the U.S. for "safekeeping". I made a mistake by switching some of my funds to gold in the summer of '97. I screwed up and I now understand what I did wrong.
Commodities did not bottom until early '99, this is when oil and then the CRB began moving higher. This is also when I should have begun switching to gold. Historically, gold either leads or rises in tandem with the CRB...the fact that it didn't this time speaks volumes about the current paper markets. Ask Julian Robertson as he got burned also (Normandy Mining).
Fighting City Hall...yep, there really is a time and place and you sure don't want to be extremely early. Still I like the gold sector even more than I did last year at this time. If I have to say this same thing again next January, fine...I can live with that (if I have to ;-)
Hi Thai,
Having a little posting frenzy aren't we??
Your preferred monicker "ThaiRealEstate"(sp) deserves a closer look though.
The term Real Estate is a misnomer that, like many other expressions in common use has gained unthinking acceptance in society.
Given the "accepted meaning" ie: Property, a more accurate term might be "decreed tenure estate" in that your entitlement to same is only as effective as the system that supports it.
The ONLY world class "REAL" Estate is GOLD - held close!
(1) If you're two years too early into a wealth-preserving investment, what have you lost? The answer is based on "What were your alternative choices to hold assets in?"
Without getting too long-winded here, I think the benchmark for most "safety"-seeking investors would be T-bills. So I figures, 2 years x 5% = 10%. That's the opportunity cost.
(2) If you mark your gold to market, 2 years = about -10%. That's the capital loss.
City Hall, post-LTCM crisis, has clipped you for about 20% total. That, IMO, represents most of the risk side of your risk/reward calculation two years back.
Could be more downside? Sure, but another 2 years (10%)? Another 10% down? NBL (Not Bloody Likely), or at least not as likely as last time around. I don't think there is a capitulation wave out there of frustrated physical holders who will dump it down to $240. They're gone already. And TPTB are only winding the paper catapult tighter if they paper it down that far.
Ask coin dealers who's selling. Estate sales, yes. Sons selling off Dad's stash. That's your "capitulation".
Sorry to all those whose principles led them to take a stand in 1980, or in 1996. Early can hurt. .Gov's got some 'splaining to do. Makes you wonder what a "fair" world would look like...
Hear ye! Hear ye! One phase of this past week's contest has reached the "metal" ceremony
Last Friday, MK made a declaration from the the Castle walls that there should be a contest of erudite prediction for the year ahead, and one other of marksmanship for the week ahead. We now have the final results, as the closing COMEX February gold target has been revealed. Silence please while I read from the official parchment:
-----
[FWN] New York--Jan. 25--COMEX Feb gold settled down $1.9 at $262.9 per ounce, after falling to a 16-month low of $262.0 on continuation charts, amid fund selling and as funds rolled over into the Apr contract.
-----
Placing their arrows nearest the mark, we have these three fine gentlemen, and the missives provided at the time they took aim:
>>>========= $261.90 ==========>
"The speculators in the hedge funds will hammer the price down and run some sell stops at the COMEX this week. On Friday afternoon, buyers of physical will happily purchase their gold coins at an exchange rate referenced to the paper gold price of $261.90 per troy ounce."
--RossL (01/23/01; 16:49:25MT - usagold.com msg#: 46259)
>>>===========$263,50=============>
"There will be a downdraft to this price because the short traders cannot allow a perception that the gold trade will be different under George than it was under Bill. The long traders will fight to hold the recent low price. Perhaps after a week or two of this struggle things will be different."
--SEER (1/23/2001; 8:45:33MT - usagold.com msg#: 46220)
>>>============= $263.80 =================>
"Reasons given for any guess are based on mere conjecture, not fact. The POG has not reflected gold's true value for years. Unless you are the most influential puppetmaster, the POG is usually as predictable as the direction of the wind at any given moment."
--Stocks, Lies, and Ticker Tape (01/22/01; 22:51:56MT - usagold.com msg#: 46189)
As you can see, they all had a good grasp for the means in which price discovery belies the physical fundamentals, providing this attractive acquisition period for all those with understanding of the wider field of play in this realm of gold.
But getting right to it, Congratulations are hereby extended to Sir SEER who struck closest with his arrow, and with these words shall also go ownership of the tenth-ounce gold prize! "Send word to the vault guardsmen...our postmaster is coming down for a withdrawal!"
Stay tuned for further announcements as the essay judging continues...
Also, all first-time posters during the contest period (Jan 19th -23rd) will be awarded a one ounce silver Eagle. To qualify for the prize, they must e-mail jill@usagold.com notification citing the message number of that first post. (She will check each first-time poster's claim, so don't believe you can get one by us...you rascals.)
Actually, you gotta figure that SOME lemmings don't go along for that "picnic to Grandma's house." I thought we was them?
(Well, maybe it's the ones who get lost on the way, lose their directions, or just oversleep from the party the night before, who survive to reproduce the next generation of furry little conformists?)
As it seems the only apointee in the new admin of G. Walker B. not getting congressional approval, yet, seems to be John Ashcroft. May it be that his historical - and heroic - statements towards judicial tyrrany overule constitutional rights before policy objectives, are true. ... If that is so, as I believe it is, I have no doubt the US of A, along with all of us will persevere. Standing ovations to J.A. from abroad!
If only A.G.would have stuck to his six-(interest) smoking guns - he wouldn't be reduced to a pea-shooter - caught in a cookie jar, as one Senator tried to tell him yesterday and as the topic (virtual budget surplus)caught the FED Man on the wrong foot, I've had the impression shame face was desperate to get out from under...and sans any real explantions - the guy actually stuttered - unheard of, I would say? ... Y'oyou kn.kn.kno' go gggggolddd he tried to say? ... as growth is zzzzero, by the way and pppro-dductttivity a dismay to the e-ee-conomineee I did ffforsseee! gee - it's turning out - no down - as faar I can see - gee, never thought of consequences for thee global faamileeee - eeehhh - d'y'a seee?
Get reality check - mate?!? Not so great - cb2
Happen to drop by the WALL MART to pick up a few things and passed by the magazine rack. Low and behold LIKE a neon sign was the magazine sitting out in front call COINage.
Febuary issue. On the cover in bold letters was GOLD bound for a rebound. Further on down the page is,(and this made me laugh out loud) GREENSPAN AND THE GOLDBUGS. You see I had this picture of GOLDBUGS flying around his head and he is trying to swat them off with a copy of the WALL STREET JOURNAL. The article was everything that has been discussed in this forum.
Today I went to the dealer to see what he had in his display. He had plenty of 1/10th and 1/4th but only one half and two 1oz. He said the larger coins are moving much faster, still sales were good. So I picked up some silver since it is not time for me to get gold. Payday nexts week.
Thank you HOOSIER GOLDBUG for the invite. May have to take you up on that sometime.
If Greenspan is Mr.Wizard Then the economy is definitely TOUCHEE TURTLE. He is always screaming, Help me Mr.Wizard Help Me!
Stranger, Peter Asher and all
A news item from a Boston, MA. television evening news from last night. Real estate prices (didn't specify residential or commercial) in Boston increased 33% last year. 33% in One year. Is this a result of inflation? *****
Also, concerning the $760 for every man, woman and child, the misses and I haven't recieved our $760 each yet. Does anyone have a government address or phone number so we can report that we've been overlooked? Come to think of it, we didn't get our last payment either. *****
With all this money being created, commodities other than energy and palladium are still depressed. Many grains, critters, fibers and softs along with gold and silver are still near or at multi-year lows.
Increased money supply but only selective price increases?
Happy weekend
Rich
... as I was just checking in again, after writing most of the lead article on a Gold Mining Journal - I have to thank you for a trigger of a new thought - I'll tell you asap. regards cb2 ...
This forum is a real treasure trove - thank you all and special thanks to our hard (asset-) nosed host - MK - cb2
"Hoople & 'flation heads...Hoople Re - inflation index
"Those numbers are real but a true index needs to be apportioned according to the percentage of the average consumers budget they represent. Also, car and home finance are a major part of most people's dollar payout and therefore must be included for a true picture. "Lack of volatility" is no more ground for leaving them out then there is ground for the Fed to leave out food and energy. The cost of making ends meet is what it is. A sudden spike on any particular month will always contribute to emptying that months wallet. Any good or service that creates a noticeable effect on most folks expenditures would be in a valid index...." end of excerpt
In mitigation I think you might have mistook Sir Hoople. I do not think he intended his index to imply that there was scientific validity to his "index". I took it more as a satire used to reveal the lack of scientific validity involved in the gummit numbers. I do believe that what he meant was that his "index" was certainly real as far as he was concerned. Mine is real as far as I am concerned. The gummit's index is real as far as the gummit is concerned. The whole matter is laughable at best. There was a time when the CPI numbers were a serious matter and handled with more integrity than they are today.
Your point in a later post, I believe, that inflation is by nature an increase in the money supply (in excess of real GDP growth)is right on. The excess money will certainly chase something. The velocity of money is never negative. Once the velocity of money approaches zero it ceases to be money. Just thinking outloud. I think I just said something important. Na!
I had to upgrade my machine at work...gave up my 300 mhz machine for a new 450 mhz machine. Wow, you might think, 150% increase in horsepower. Maybe so, but not 150% in throughput, and that's what counts. You see, my old machine was running Windows NT. My new machine is running Windows 2000.
I was in the process of developing a software application that had performance benchmark messaging, i.e. for different tasks that it accomplished, it prints a message that indicates how many milliseconds the task took to complete.
Well, after moving my application to the new machine, guess what? Tasks that took 4 seconds to complete now take 12 seconds to complete. That's right folks. The wizards at Microsoft have given us a new operating system that requires a supercomputer to run. I increased my processing power by 150% and, thanks to Windows 2000, I have decreased my throughput by 300%. Now there's value!
All I can say to anyone considering the move is...govern yourselves accordingly...
To salvage this as On-Topic, congratulations to you lucky winners. I gave it my best but you "won the gold".
Good to hear from you again. I certainly would like to see your predicted gold appreciation happen but hopefully without economic disaster. If your scenario were to play out as you see it, would you care to venture any guesses as to a time frame? Also, what of silver?
Thanks
Rich
R Powell (01/26/01; 15:43:10MT - usagold.com msg#: 46577
Sir Rich
Concerning the $760 you missed out on. I think my neighbor got yours and mine. As to your question, "Does anyone have a government address or phone number so we can report that we've been overlooked?" If you are adept to lying you can get in on this deal by simply appearing at the nearest welfare office and telling them that you and your poor little children are hungry. They won't check you out. They will walk you right through the tape in short order.
While you are at the helpful office show them some gold. They will no doubt consider you the poorest of the poor.(grin)
BTW, I enjoy your short spurts. I always stop to read when you post.
Sir:
I nearly died laughing. A similar less technical experience occured with my wife. I got her a much faster Compaq laptop about two years ago with lots of speed, bells, whistles, etc. At the same time I upgraded her from Windows 95 to Windows 98. She has never forgiven me.
Respectfully,
HBM
PS: To qualify for on topic: So much for Greenspan's high rate of productivity via technological advances.
... rose to all time high - Palladium - while GOLD fell to a 16 mth. low 'after a powerful earthquake rocked India's center of bullion trade, Ahmedabad... sad... and cant'u beat this spin? ... Schwachsinn! ... 'u win - hey, you too... cb2
"For example, few people know yet that Codoleeza Rice, G.W. Bush's foreign policy advisor, plans to propose that England -- America's Mother Country -- be invited to join two of its former Colonies -- Canada and the United States -- plus Mexico in NAFTA. The British people are shown by the polls to be against being pulled into the European Monetary Union -- just as they have resisted every effort by Europe to gobble them up, from the invasions by the Romans, Danes, and Normans to the threatened invasions by Napoleon and Hitler. With elections scheduled for this year in England, and the current socialist government trailing badly in the polls, it may be that a new Tory government will be coming to power within months. . .and could be willing, even anxious to form a closer relationship with North America." End
From "The Money Forecast Letter"/Adrian van Eck
As I said, FOA, the fifty-first state. (Smile)
A thought: UK is already part of the European Union where trade barriers have been torn down and goods flow freely as they do between states in the U.S. If UK also joined NAFTA, goods could flow freely from the U.S. to UK to the continent and vice versa What a coup!! (For CPM/USAGOLD included. . .) London would find itself the crossroads of the commercial world between the world's two richest markets.
Additional thought: If Britain becomes so situated (a brilliant stroke), why not keep the pound, do an end run on both the euro and the dollar and make IT the third leg in the reserve currency sweepstakes. Out of nowhere -- the pound -- in which case we are both wrong, FOA. (Cough. . .)
An excellant writeup. I'm sure you speak how many of us think...only you express it so clearly. Personally I gain something from each of your posts that I've read.
After conversing with a lot of people in the ~30+- age group, I have come to the conclusion that they all have charged that $760 to their cards. Most of them have maxed credit cards with no plans to ever pay more than the minimum payment. When I pressed the issue, some admitted that their charge card debt is larger than their 401K.
JavaMan @ # 46581
You must have skimped on the 256mb ram that you now obviously need.
MK-The great prize in this shuffling of the global monetary deck is the UK (sans Ulster thank you very much.) You imply a logistical advantage perhaps not seen since Constantinople and her Byzantine tenants ruled much of the world from the Golden Horn for almost 1000 years. Manchester is a long way from Monterrey; a very long way. The UK trade flows to the East naturally. As usual, your thought is excellent. However, the British being primarily a conservative people will not make a (quantum) leap of faith across the pond I do believe. Rather, they will be a key member of the EC over the long haul. They will need to make the very best deal they can especially since dishoarding precious AU from HM's Treasury. They will be in need of a partner who can add value to them. Could a significantly weakened dollar prove a strong lifeline? The English like us no better than the French or Germans and, they (English) do already have a considerable investment in this country. I say she will
bend to the wishes of her best customers. With so much leverage in the financial communtiy globally, England can and will remain relatively aloof anyway. Just rambling as usual....CM
From my: ThaiGold (01/01/01; 00:03:09MT - usagold.com msg#: 44802)
My New Millenium Predictions
[snip]
New Common Markets]
Latin America (South, Central, and Mexico) will form a Latin America Common Market.
Call it the LACM. Their Silver based common-valued coin and currencies will provide
the stability for growth and integrity required of them to become vibrant and strong.
Canada, of course, being rich in Precious Metals, will welcome similar revisions
to their coin and currency. Once again they will become proud of their Maple Leaf
coins of Silver and Gold. And Loonies will no longer be looney.
Australia, also rich in PM's, will lead the way to a rebuilt "Common Union" with
Canada, and the United Kingdom. This will be very popular with their citizens,
and as an act of comradarie, assit England (UK) to become strong and prosperous
once again. A new "Empire", based upon Common Markets, and commonized PM money.
[unsnip]
If you roll them all together, it's quite similar to what your post suggests.
It was an excellent post, I thought, at the time. Did anyone read it.?.
Ah, "DISinflation" is DISinformation! Please, folks, refrain from giving aid and comfort to the enemy!! The use of this word in this context is DIStressing.
DISinflation is just a SLIGHTLY lower rate of inflation than you previously got used to accepting as normal. It's a clumsy and DISingenuous attempt to excuse excess fiat monetary creation. It's DISgusting!
REAL DISinflation was previous to 1912 when prices gradually DECLINED - - - because the supply of gold over-all grew a bit more slowly than the over-all supply of goods and services, etc.
Incidentally, despite this monetary deflation (disinflation), this period over-all enjoyed one of the greatest rates of economic expansion ever seen in this country.
Farfel, and all you others KEEP SPITTING IT (IDEAS, SLANTS, VIEWPOINTS, OPINIONS, ETC.)OUT!!!!!!!!!!!!!!!!!!
Enjoy everybody's views and posts!
Thank you SINCERELY!
http://www.usagold.com I did a study of a small community near where I live in Oregon as part of my work. The study involved homes in the $120,000-$150,000 range. There was consistent, irrefutable evidence that homes were increasing $1500 per month all throughout last year.
While that may not be true of all areas, it certainly a sign of inflation here in my local area.
(That was some homework assignment!) Sheese Journeyman, what's gotten into you tonight? Too much TGIF? Your riding around with your lance tip unsheathed!
I was using "Disinflation as a word to describe a diminishing in the rate of inflation itself.
Oxford American, Scott-Forman and Roget's Thesaurus don't even have the word, however Webster's New World has it as "a reduction of the general level of prices, designed to increase purchasing power but prevent deflation." Now that's sort of what your referring to before 1912, but note the word �designed' as if it's being done by whoever, rather than something that occurs.
The Careful Writer, A Modern Guide to English usage, by Theodore M. Bernstein, says the following:
DIS � In word formation the easy way is not always the simple way. The prefix "dis- denoting reversal, removal, or negation, provides an example. Embark means to go aboard a vessel. When it was necessary to convey the reverse of this action, our fore-fathers simply affixed a "dis-" in front of the word and gave us �disembark'. That was the easy way, but it was not a simple, direct approach because it produced a word that really means to go un-aboard a vessel --
So, " reversal, removal or negation" of inflation is described by the word �disinflation' but apparently really means un-inflate.
OK, cool we can all say �uninflation' instead of �disinflation', that's fine; Now, what are you REALLY upset about?
Our little hamlet here in the midwest has averaged $8900/year the last five years. I'm surprised at your data. How about selling and lease back? Invest proceeds in treasuries and PM
Just received my 1/2001 gas bill today and it's a sight. Here in the North Central Plains, residential heating costs are up 120% y/y, and that's with the thermostat turned way down when away. Good thing this won't go into the "core" CPI rate, or "The Maestro" may have to reconsider his wayward policies. If we try hard, I'm sure we can come up with a hedonic substitution to power forced air gas furnaces...maybe hook up directly to the hot air coming out of BLS/CNBC/FED?
>>> Once the velocity of money approaches zero it ceases to be money. Just thinking out-loud. I think I just said something important. Na!<<<
Maybe it is, let's look at it. All money is either under a mattress or in some form of bank ledger. @ zero velocity, it would stay under the mattress and, in the banks, not move from one ledger entry to another. This of course is akin to the concept of infinity; you can approach it but can never get there. Absolute, zero velocity would see some very rotten groceries and some very hungry people; absent any barter activity.
Therefore we could theoretically have a very large money supply chasing at that instant, nothing.
But, that instant would be followed by the banks returning the money up-stream from whence it came so as not to owe interest to the Fed and therefore the money supply would immediately diminish --- Hmm, This could serve as a proof that velocity is senior to quantity in the "Great �Flation Debate."
Mountain of Shorts?Thank you, Sir, for your thought provoking dialog. I have always thought of the "mountain of shorts" {paper/derivatives} as a veritable proof that large quantities of gold are NOT AVAILABLE to the assorted suppressors of US$ POG. How does your cycle mechanism of selling/buying back account for the formation/necessity of so many tons of shorts? Shorts NOT nekked?? They simply must be backed by something OTHER than physical gold; i.e.- "full faith and credit" {presses}.
ThaiHoldSilver! Agspec has a few Q about same. Ag & Au have very similar short predicaments as far as COMEX{s}. What OTHER similarities exist as far as a working mechanism used with GOOP? This mechanism, as you explained it, depends on a large supply available of Au/Ag to set the process in motion. There is no AM/PM fix by the R's Bank/London to allow this to take place that I am aware of. LBMA also perform silver miracles? Ag & O,O,O? Bottom line Q.....What do you see as existing/available above ground silver supply??? ThaiHoldSilver.!.Awaaay.. That protagonist had ample supply of Ag-ammo in case of dire circumstances. Do you believe as your namesake? Are the untouchables on sound footing with silver?
So many Q, so little time! Thanks again--- agspec also
tedw is in the Rouge River Valley area or Grant's Pass, I believe.
There is "Chuck it all and move to the country" factor there. Plenty of clean water and cheap power in Oregon also. Most folks don't find out till after there in that just beneath that cosmetically clean, , love your neighbor, tolerant face; is an ultra conservative , don't let anybody do anything, confiscatory monster.
The safest way to capitalize on a real estate demand boom is to discern the grounds for the trend while the potential buyers are still in denial. Run-away real estate values could be described by John Stewart Mill's (loosely quoted)" New ideas are first met with ridicule, then argument., and finally, acceptance.
http://www.crbindex.com/news/story2203.htmlDAVOS: Swiss Central Bank's Roth won't say if rates have peaked
Davos--Jan. 26--Swiss National Bank (SNB) President Jean Pierre Roth said the Switzerland's gold sale is proceeding as planned and the targeted 220 tonnes sales quota will be achieved by the end of March. ( Story .15963 )
-----
Is this 220 tons since the beginning of Swiss selling last year, or have they already placed 220 tons this year? The word "quota" and 220 as a target has me a little confused. Anyone know the details here?
Attn: auspec (01/26/01; 21:20:27MT - usagold.com msg#: 46600Hi auspec/agspec..
Questions, questions. You ask many questions. Good ones too. Unfortunately, I do
not know all of (or even very many) of the answers. That's what you all are on
this Vision Quest to accomplish. I need the answers too. Lets' think about them:
[you ask (1)]
I have always thought of the "mountain of shorts" {paper/derivatives} as a
veritable proof that large quantities of gold are NOT AVAILABLE to the assorted
suppressors of US$ POG. How does your cycle mechanism of selling/buying back
account for the formation/necessity of so many tons of shorts? Shorts NOT
nekked?? They simply must be backed by something OTHER than physical gold; i.e.-
"full faith and credit" {presses}.
[my response (1)]
Early on I mentioned the BandWagon effect. FrontRunners. Cohorts among the big
facilitators. So, we have the GOOP (solid) gold coming into the market with
the specific intent to use it to trigger a downward snowball. (To buyback it
and more, later at rockbottom. ... fleecing the Long suckers.) Well enough.
Now here's your answer. The facilitators (let's call one Goldman Sicks). He
is in from the start as the GOOP broker. He knows what will happen. He is very
greedy. He jumps on the BandWagon,or even (horrors) FrontRuns it. Using paper.
(He is backstopped by Gov't gold if timing is wrong, and unexpeceted spike up,
or other malevents require a quiet bailout by uncle.) Uncle himself, is also
facilitating the GOOP sales. To make CPI look tame. And to appease the GOOP
merchants so they will sell us their Oil at half its real worth. This is their
payback. The other half. In gold. By permitting it; looking the other way and
other nefarious facilitations. Your mountain of shorts is heightened, by the
astute COMEX day-traders who also know the pattern. They jump on the wagon too.
Clever, isn't it. How the Giants are aided by the Midgets. Mole hills soon
become Mountains. And POG plummets. Just as planned.
[you ask (2)]
Ag & Au have very similar short predicaments as far as COMEX{s}. What OTHER
similarities exist as far as a working mechanism used with GOOP?
[my response (2)]
GOOP only gets exchanged for Au (gold). Ag (silver) has traditionally traded
as a subset of Au. POG is hammered. Ag gets hammered. But in less dramatic
amounts. Mostly it's the (same) FrontRunners dipping both markets parallel,
as they know the usual depressing result. And so they can greedily scoop up
more cash without GOOP being directly involved. Look at a long term chart of
Ag (POS) and compare it to long term Au (POG). You will see, as I posted way
back when, an odd dis-similarity. The POS is more stable. Fluctuating in less
synchronous ways. It's very strange. I attribute the difference to the COMEX
day-traders; insiders; skittish behavior in the volatile Ag market. And too,
silver has basic fundamentals that are more market/industrilaly driven that
tempers the action more so than found in Au markets.
[you ask (3)]
This mechanism, as you explained it, depends on a large supply available of
Au/Ag to set the process in motion. There is no AM/PM fix by the R's Bank/London
to allow this to take place that I am aware of. LBMA also perform silver
miracles? Ag & O,O,O?
[my response (3)]
No. I didn't say that there is a large physical GOOP suply of Au/Ag. Only Au.
The Ag manipulatin is paper driven shorts. But I suspect it is entirely very
possible that one or two large holders of physical Ag may be playing a similar
game as the GOOP guys. Soros, and the other Giant guy. His name escapes me as
I write. The guy who bought umpteen zillion comex silver awhile back and had
it shipped to London. Sure you know who I mean. Call him SilverGoop Wannabee.
The acronym LBMA has "B" as Bullion. That could be Au and Ag Bullion. Maybe
Pandagold can tell us more about the LBMA silver trading, or what market is
used for Ag in his little township. (sheesh... Only one square mile.) (with
fog so thick you cannot see Forests, for the Pomp). I digress. Sorry.
[you ask (4)]
Bottom line Q.....What do you see as existing/available above ground silver
supply???
[my response (4)
As I understand it, it is virtually zero. Even the US mint has run out and must
now go into the Ag spot market to obtain it. Hence the recent steady POS rise.
For exact numbers, GoTo: http://www.silver-investor.com and link to the Ted
Butler articles. You will learn from those, the true severity of Ag supply.
[lastly, you ask (5)]
ThaiHoldSilver.!.Awaaay..
That protagonist had ample supply of Ag-ammo in case of dire circumstances. Do
you believe as your namesake? Are the untouchables on sound footing with silver?
[my response (5)]
The Lone Ranger certainly used Silver Bullets. Tonto didn't. But I do. Common
GoldBugs would be wise to have a second footing of Ag. It's a no-brainer, that
POS will explode soon, just because of the fundamental shortages. Hopefully,
that will be the ignitor for POG to explode too. But do not bank on it. The GOOP
manipulation of Au is ongoing, and necessary to the Giants. They (I think) will
continue to do their Oil-to-Dollars-to-Gold manipulations as long as they have
excess PFO. Profits from Oil. Remember: There is a point, (about $12/bbl) that
oil production does not generate *excess* profits. At those times, they cease
their GOOP manipulation. Because they have no excess US$ to change to Gold.
Hope these remarks have been helpful to your Quest. And I'd welcome others to
join us, and share their thoughts, suggestions, theorys, facts, and questions.
Even brickbats are welcome along our quest. But beware the Silver Bullets.
I thought they were selling 1300 tons over 5 years - 260 tons a year. I read somewhere that they had sold around 160 tons by sometime in December, so this leads me to believe that the 220 tons mentioned is a total since the beginning of the sales program(?)...not sure. And why is March an end date for the yearly sales quota?...I thought the end date for the sales quota per year was stated to be the end of September.
Good to see you back again. You might remember that some of us were joking a few months ago that when the Clinton's left DC, that the staff may want to make sure that the departing first family didn't abscond with the White House silverware. It appears that it was no joke. It appears that not only is White House silverware missing, but according to a couple of "minor" news reports on CNN and FOX that there is also missing linen, among other items not given as "gifts." Hillary has gone into seclusion for a few days, apparently until this all blows over. A lot of corrupt activities are about to be exposed and the "buying" of presidential pardons is only the "tip o� the �berg."
Calif. Energy Crisis Effects Arizona, Davis Deals Cloaked in Secrecy, Greenspan � Crisis Threat to Economic Expansion
By John Howard AP
SACRAMENTO, Calif. (AP) - Gov. Gray Davis and legislative leaders agreed Friday on a plan to resolve California's electricity crisis that includes public ownership of two huge utilities and years of power-buying by the state. ``The state will be in the power business for a long time to come,'' Davis said. He said details are still being worked out, but will include state ownership of utilities and long-term electricity purchases for the cash-starved companies. Southern California Edison Co. and Pacific Gas & Electric Co., the state's two largest utilities, say they have lost $12 billion since June because rate caps prevent them from passing on to their 10 million customers the full cost of wholesale electricity. The caps are part of California's decision to deregulate the electricity industry, a plan Davis has called a failure. Under the plan described by lawmakers, the state would issue bonds to cover utility debts and make customers pay the money back over 10 years through recently approved rate increases of 9 percent for residential customers and 7 to 15 percent for businesses. In exchange, California would be granted long-term options to buy low-priced stock in the utilities. The state could sell the stock and use any profits to help pay off the bonds. The utilities have declined to comment on the proposal. Lawmakers said they planned to work on the proposal through the weekend. Some demanded an investigation to learn how much taxpayer money - if any - would be at risk under the plan.
Several Republicans said Davis, a Democrat, has released too little information about the secret bidding process the state is using to find long-term contracts to buy power for SoCal Edison and PG&E customers. Assemblyman Tony Strickland, the GOP minority whip, said withholding information could cloak how much the state pays for electricity. ``This is equivalent to Governor Davis saying that he had a seven-course gourmet meal for only $20, but the price didn't include food or drink,'' Strickland said. The governor's office declined to release details on the bidding. Meanwhile, the keeper of the state power grid, the Independent System Operator, prepared for a weekend of power scrounging, though rolling blackouts like those that hit Northern California twice last week were not expected. Power was cut Friday to 1,200 businesses in Southern California that had agreed to emergency outages in return for lower rates.
California has been under a near-continuous Stage 3 alert for the past two weeks, its power grid stressed by high demand, uncertain imports, transmission problems and power plants idled for maintenance.
Arizona Gov. Jane Hull also met with Bush administration officials in Washington on Friday, saying California's energy problems are starting to affect Arizona. One utility, the San Carlos Irrigation District, said its 13,300 customers will see a 300 percent increase in next month's bills. And Federal Reserve Chairman Alan Greenspan told a congressional committee this week that the California crisis threatens to undermine the country's economic expansion.
Black Blade: Energy crisis in Kalifornia is spreading like wildfire. I see that the major "mainstream" media have been hitting this crisis hard over the last week or so. This situation will get much worse before it gets any better.
California public utilities are in trouble. The power blackouts interrupt business activity. Pipelines are disrupted and a fuel shortage looms. One sixth of the US economy is in danger of more power shortages, a temporary idling of business activity, and an interruption of the fuel supply necessary to keep the region's vital transportation system flowing. The impact on an already weakening US economy might prove grave. What happens next? Is the situation cause for alarm?
The troubles facing California can be traced to the deregulation of the utility industry in 1996 and its effect on the state's two largest utilities-PG&E (PCG) and Edison International (EIX). At that point, the two California utilities were encouraged to sell their own electricity generating facilities and turn to the open market to buy the necessary power to supply to their customers. In addition, the rates the utilities could charge their customers were capped.
When costs of power soared in the open market, but the utilities could not pass those increases on to customers, the utility companies started to lose money. Now, confronted with $11.5 billion in power-buying debt because regulators won't let them pass on all of their power costs to consumers, PCG and EIX are in danger of bankruptcy. The financial problems are making generators and gas producers reluctant to sell into the California market. The result has been a dwindling of power supplies and rolling blackouts throughout the Golden State.
California represents one-sixth of the nation's economy and should it become faced with ongoing blackouts, the consequences might prove grave. According to a research note recently put out by CS First Boston (U.S. Economics Comment: A Brief Note on California, January 18, 2001), the state of California accounts for roughly 13% of US Gross Domestic Product [GDP]. If power is a vital input to all of the state's economic activity, and electricity availability went to zero and stayed at that level for the entire first quarter, the level of US GDP would go down by 13%. That, in turn, would imply an annualized growth rate of negative 42%. For each day power is down, GDP would fall by -.5%. In short, the possibility of blackouts in California should be treated as a significant threat to the overall US economy, and by correlation, to the overall US financial markets.
Yet, while prolonged interruption of power to the Golden State poses a risk, it is also in the realm of the "unthinkable." The Federal Government has already issued a directive that requires power generators and natural gas companies to sell to the two California utilities even though they are on the brink of bankruptcy. The initiative, first issued by the Clinton administration, was recently extended until the second week of February by the Bush administration. California Governor Gray Davis said that he was confident that those two-weeks is all that is needed to restore the financial health of the California utilities and avoid any more power interruptions.
At the same time, measures are being taken at the state level to improve the situation. Since the two utility companies are no longer able to find loans to finance the purchase of power, the state has stepped in to buy it on their behalf. In an effort to do so, the state of California conducted an auction on the Internet. The auction provided companies the opportunity to supply bids to supply power to the utilities. Governor Davis hoped to lock in long-term contracts for power at about $55.00 a megawatt hour, or about 1/5 the price quoted on the California Power Exchange. The auction was completed on Wednesday and brought 39 bids at an average price of $69.00 a megawatt hour. While somewhat higher than expected, on Thursday (January 24, 2001), shares of both PG&E and Edison International soared. Investors returned to the battered stocks after the results of a state power auction gave hope that the long-term contracts will help the two utilities avoid bankruptcy.
Other proposals have been put forth that would allow PG&E and Edison International to reimburse the state. In one proposal, the two utility companies would donate their hydroelectric plants. In exchange, the state would buy more power through long-term contracts and on the spot (cash) market. In another proposal, the state would accept warrants, which provide the right to buy shares of the company's stock at a predetermined price, in exchange for buying power. Banks have also extended time on the re-payment of loans to the two utility companies.
During a question and answer period before congress, Fed Chairman Alan Greenspan was asked about the situation in California. He noted that California represents a sizeable percentage of the US economy and the problems there have the potential of affecting the other 49 states. Obviously, the most significant impact would come from allowing the "unthinkable" to happen, or for the state to experience a prolonged absence of power. Given the recent response by both the California and Federal governments, however, that appears to be the least likely scenario. Indeed, the Golden State may be "too big to fail."
That said, until the situation is fully resolved, the danger to the US economy and financial markets still looms. According to the aforementioned research note from CS First Boston, the longer the situation drags on, the greater the chances of further interest rate cuts by the Federal Reserve-including a one-half percentage rate cut at the January 30-31 meeting. If so, that can be taken to suggest that the Fed Chairman and his cohorts do see the situation as a threat to the US economy. That, in turn, provides further incentives for the investor, trader, and option strategist to avoid ill timing of short-term moves in US financial markets, but instead focus on long-term profitability.
Frederic Ruffy
Senior Writer & Trading Strategist
Optionetics.com ~ Your Options Trading Site
fruffy@optionetics.com
Black Blade: More and more of the investment community are beginning to come to terms with this mess. Basic material for those who regularly visit this forum, but a good primer to pass along to the "Uninformed."
http://dailynews.yahoo.com/h/kmbc/20010126/lo/299908_1.html There is no simple answer to why natural gas prices have shot up so high this winter, KMBC 9 News' Micheal Mahoney reported. Last year at this time, the basic unit of natural gas sold for $2.34, which is cheaper than a box of Cheerios.
As of Friday this week, natural gas costs four times that much. The problem is not that there is a shortage of natural gas. The problem is a collision of the worst possible events at the worst time, Mahoney reported. "The price of natural gas from New York to Georgia to Missouri is equally high," former utility regulator Carl Zobrist said. Zobrist said that he has been watching the storm building.
First, because the price of natural gas at the well used to be so low for so long, it wasn't profitable for the drilling companies to go after much of it, Mahoney reported. "We're about 1,000 rigs short of what we need to pump the gas out," Zobrist said.
Second, inventories of natural gas dropped off last summer after companies exported it to other countries who were willing to pay more for it. Electric plants powered by natural gas have also increased the demand for gas, Mahoney reported. Fed by dwindling supplies, increased use and one of the harshest Decembers the country has seen in a while, the price of natural gas skyrocketed this winter. "We're not just talking about people near the poverty line here. We've got people making pretty good money being confronted with $500 gas bills," Zobrist said.
In July, the Public Service Commission issued a warning that predicted higher natural gas prices this winter, Mahoney reported. Kansas City is less than 300 miles away from one of the biggest sources of natural gas in the country, the Huegoton fields of southwest Kansas.
Black Blade: A hit and miss here! 1) Yes! we are short drill rigs � massively short and this is a real killer! 2) No! We do not export NG to other countries � it would require either expensive liquefaction or extensive pipelines, in fact the US is a net importer (mostly from Canada). I also should note that Kalifornia officials have suggested that they purchase power from Mexico and also build power plants in Baja California. El Presidente Vincente Fox said "No Way!" they don't have enough power for Mexico, let alone for California. He also suggested that California build in their own backyard. He more or less gave Commissar Davis the "finger."
I can only assume from your remark about removing my head, that you assumed my response posting to your question was my definitive answer. Maybe it was my fault that I didn't make clearer that I needed time to find a way of putting it which you would understand, without my painting it in large simple English words.
There are somethings which, when you understands what goes on, you learn not to be too out-spoken on - that is if you wish to keep your head.
Someone else has tried to explain, in the best way he could find, but I have noticed his postings have disappeared from the forum ( I wonder why, and where he is?)
My few comments were only intended as a 'warmer' , a few basic ingredients which many know, but do not really absorb into their mental processes.
It is my intention now to leave any further comments on the real problem which the world is facing, and from which all these others, discussed here, are mere tributaries of one mighty undammable river that would make the Yangtse seem like a mountain stream.
I will say this though, you are way off beam in how you see the new millennium. There will always (one shouldn't say always, really) I mean in our lifetime, and someway beyond, a link with the old ' Brit. Empire Club'. This will be for many reasons, some explainable, some not.
Before there is 'One World' (some distance down the road). The world will divide into three main blocks. Europe, Asia, and The Americas. They are moving strongly that way now. But the ultimate aim is One World - Ein Wolk, Ein Reich, Ein Feuhrer!
Yes, the dream of many. But all those who tried it, tried it militarily. That is not the way to conquer, as the 'elite' discovered centuries ago. It is easier to control people with 'money', than with a whip. Takes longer, but is more effective.
Doubt me? The mighty Roman Empire with its fine military machine collapsed when it ran out of - MONEY. The British Empire collapsed when it ran out of - MONEY!
The greatest military machines of recent history Napoleon, and Herr Hitler, were defeated by those who had the most GOLD. He who has the most gold RULES!
emblazon that on your mind. THEN and ONLY THEN, will you even begin to understand gold.
All the world's greatest ventures, military, or otherwise had to be financed by GOLD; even Columbus' search for the New World.
Are you beginning to get the message? Do you need me to explain now why that question you asked, need not have been asked - because it would NEVER happen.
They couldn't even do it with silver, and gold is a far different kettle of fish.
Learn who owns and controls the world's gold. You hear the 'brainwashed, financuially uneducated, say 'Ah, but gold can't buy you health'. No it can't, but it can buy you the finest surgeons, and best available drugs and surgery.
Get wise! Join the Gold Club own some gold ( OK so you are on the bottom rung of the ladder but it's a start, and at least you know you are doing what the 'big boys', the VERY big ones, do).
(Sorry I have to rush this, but so much to do. It's an exciting world, so much to do, so little time)
And they try to tell you that gold is just a commodity. Get wise. Those who run this world, are the only one's who understand the 'Power of Gold' and they learned it at a very early age.
Professor Bharat R. Kolluri (link) found that during March 1968-February 1980, a one-percent increase in anticipated inflation resulted in a 5 percent increase in the capital gain on gold, and the relationship is much stronger for January 1974-February 1980. Perhaps because of the oil crisis?
MK-Senator Phil Gramm proposed the UK merger into NAFTA about one year ago as reported here at USAGOLD.com. At that time, we were into the thick of it with FOA. What's happened since that juncture? Have those fires cooled? I believe they continue to blaze behind those veritable "closed doors" we all like to make reference to. As FOA contends, political events impacting global monetary (mis)management are indeed fluid.
My take FWIW on NAFTA: More than Pat and Ross being right, NAFTA has furthered the dollarization of Mexico and cemented a cheap source of production of manufactured goods to sustain the unsustainable north of the border. I've been through those border (maquila) areas. It is shameful. If more Americans stopped to consider....there would be an outrage.
El Presidente Fox will sell (some) Juice to Kalifornia
Thanks Usul.
Just heard on the radio that El Presidente Fox of Mexico will allow the sale of 50 MW to California with a total of a 200 MW package. That is almost an insult because it is so miniscule (quite funny I think). I await to hear the response from the Commissar.
RossL, you made a good point as the amount of RAM could definitely be a factor but actually both machines have 256 MB of RAM. Any serious software development requires that much memory, but I was mistaken in my numbers...a difference between 300 mhz and 450 mhz is 50% not 150%. I should have calmed down before posting. At any rate, as HBM alluded to, so much for hedonics.
I believe that, to some degree, this is part of the strategy (read "conspiracy") on the part of Microsoft of planned obsolescence by continually requiring more powerful platforms in order to run software on their operating system. However, Windows 2000 offers nothing when compared to Windows NT that justifies such a hit in performance. As a matter of fact it has "features" that I would prefer to do without or at least be able to turn off. But if everyone kept their NT (or Win95) machines, there would be less market for new PCs and, thus, less market for Microsoft.
This brings up an interesting point regarding Microsoft's anti-trust law suit argument that the "industry" needs a standard so it can move forward. And also the argument that Microsoft is market driven and sensitive to the customer's needs. But what happens when that "standard" involves costs you'd rather not pay? As my lovely Hispanic wife would say, "this is caca doodle!"
On another note, last Sunday's local newspaper had an article about our recent unemployment figures. Here, in Research Triangle Park, North Carolina (the Silicon Valley of the east coast) unemployment has gone from almost zero to the national average (approximately 4%). I expect it to exceed the national average eventually because there is so much technology here and we will probably take a proportionally bigger hit.
Witness only the latest piece of news about Ericsson's decision regarding cell phones. Ericsson has (had?) a huge facility here. Maybe we can turn it into a shelter for the homeless (all the people who used to work there) because they aren't going to be using it to manufacture cell phones anymore.
My point is that as we watch the race between the purchasing power of our dollars and the value and quality of the things we buy to ever lower levels, we recognize the need to be wise stewards of our personal resources. But the impact of inflation which will simply drive us to hunker down accordingly, will be a tremendous shock that is greatly amplified to those who find themselves among the newly unemployed. I wouldn't wish that on anyone.
London, Jan. 26 (Bloomberg) -- Palladium jumped almost 6 percent near a record after shipments from Russia, the first in weeks from the world's largest supplier, proved insufficient to meet demand. ``The metal did come, but the scarcity persists,'' said Ralf Drieselmann, head of precious metals trading at Frankfurt-based Degussa-Huels AG, which uses palladium in automotive catalytic converters. ``Buying interest is overrunning'' supplies.
Palladium for immediate delivery rose as much $60.50, or 5.8 percent, to $1,110.50 an ounce in London, near the Jan. 12 record of $1,125 an ounce. Prices have soared from around $225 three years ago because of sporadic Russian sales and rising demand, driving up costs for carmakers, dentists and electronics makers.
Russia, which supplies two-thirds of the world's palladium, delivered metal to Japan and commenced shipments to Europe, traders said. RAO Norilsk Nickel, the country's only producer of the metal, has pledged to begin sales before the end of this month. Still, the other two exporters, the central bank and the State Precious Metals Reserve, have yet to disclose their plans. Norilsk officials responsible for exports weren't immediately available to comment.
Russia sold some 5.2 million ounces of palladium last year, according to London-based Johnson Matthey Plc. Norilsk, which exports almost all palladium it makes, mines an estimated 2.7 million ounces of the metal a year. The bank and the reserve, which deliver metals from their vaults, account for the rest of shipments. ``All material that we see coming out of Russia now is fresh metal from Norilsk,'' Drieselmann said.
The State Reserve said earlier this month it may make some deliveries this year, revising a statement from last year that it planned no deliveries in 2001. The central bank has repeatedly declined to comment on the issue. Demand from the automotive industry remains strong as countries from the U.S. to Japan introduce more stringent emission standards. Even though carmakers are cutting back their use of the metal, switching to cheaper platinum, demand for palladium surpassed supply for the fourth straight year in 2000. Palladium has more than doubled in price over the past year.
Black Blade: Got email from the cold wasteland this morning. My Russkie friend thinks that any significant shipments are unlikely and that they may even end after March. I asked him about the so-called "deliveries." He thinks that Norilsk Nickel is shipping from current production. He said that even the Nickel production is down. I still say that the PGM stockpiles are depleted as my Russian Friends have said in the past. Life is still very harsh in their part of the world and it's not getting any better. My friend Sergei says that the corruption is pervasive at the local level and the mine management is no better. Looks as if PGM prices could still rise from here (unbelievable as that may seem).
Hey ThaiGold - thanks for your contributions here. You wrote;
ThaiGold (01/26/01; 23:00:55MT - usagold.com msg#: 46605)
I'm Awaiting Any One of the Three...
Attn: Peter Asher (01/26/01; 21:25:50MT - usagold.com msg#: 46602)
Peter Asher wrote:
[snip]
...John Stewart Mill's (loosely quoted) "New ideas are first met with ridicule, then argument., and finally,
acceptance."
[unsnip]
"I believe he may have been talking about me, not Real Estate."
I've probably read nearly every post you've made here since you started posting. I probably speak for many when I say keep it up, you have many interesting things to say. Above all, you make me think and I thank you for that. However, I've noticed you are discontented with your perceived level of acceptance here and further, seem to think you need to denigrate other views. As someone said awhile back, "Time will prove all things."
I want you to know why many here find ANOTHER and FOA quite interesting. First of all, let me post for you ANOTHER's first post over at Kitco;
Date: Sun Sep 14 1997 21:12
ANOTHER (an answer?):
This could be an answer directed to the "Red Baron"?
The CB's are becoming "primary suppliers" to the gold market. Understand that they are not doing this because they want to, they have to.
The words are spoken to show a need to raise capital but we knew that was a screen from long ago. You will find the answer to the LBMA problem if you follow a route that connects South Africa, The middle east, India and then Asia!
Remember this; the western world uses paper as a real value, but oil and gold will never flow in the same direction.
Big Trader
end quote;
You see, at the time (1997), ANOTHER brought a few ideas to the table that few had considered. I see his thoughts included some of what you reference today with your Asian drug connection. He claimed in his second post what you reference today with your profits from oil. He was the first to relate what was happening behind the scenes in the gold and oil business. He further pointed out how different the two cultures are regarding wealth.
Perhaps you can understand why he and his friend are held in such esteem. They have been at this for several years and as you can see, the message hasn't varied. As a matter of fact, several predictions have come to pass. I don't doubt there is some agenda behind the fact that they post at all, but the content is outstanding nevertheless. I don't wish to debate the merits of either their views or yours, I simply want to point out that the so-called "lemmings" might consider your denigration of them to be somewhat out-of-line.
If you have something to say which proves them wrong, please point it out, we are all listening. Once again, thanks for all the time you spend in enlightening all of us, it is greatly appreciated.
http://www.drudgereport.com/wh93a.htmI'm not sure if this was already posted, but Drudge has posted a growing list of the damage done to the White House and Air Force One.
PANDAGOLD MSG46612 Good Morning,
Very informative article on the power of gold. I agree the world will divide first into three main blocks with the ultimate goal of one world order. I also agree that great undertakings whether good or evil have been finance by gold.
The one with the most gold won.
What I am about to state never comes about in any lifetime. Gold has value for we give it value. Flint was valuable to the caveman. Bronze/iron, to medieval man. Gold /silver to modern man. Salt was more valuable than gold at one time.
When we finally get to this ONE WORLD ORDER, what will be the thing of value? Has to be a real control factor.
As investors we should be looking ahead into the future.
My guess. FOOD
Plain and simple. Armys march on it. People are content with it.
"When we finally get to this ONE WORLD ORDER, what will be the thing of value?"
When trying to envision the future, it is impossible to recognize all of the variables, perhaps not even existing today, that may come into being at that time. For instance, as I contemplate a one world government, complete with one world central bank, it may be the case that technology is used to enforce the exclusion of people who resist or decline to participate in the new order. It may be the case at that time, that all transactions are electronic.
If so, the "rebels" would be unable to conduct normal trade and an alternative, underground, currency would need to be found. What better choice than gold? The more things change, the more they stay the same.
I asked MK in a post yesterday if he could recap for the Forum any of the "predictions" of Another (he'd probably hate that word) that have come to pass. Can you?
Hello Thai. I concur wholeheartedly with ET; especially about your contributions to the forum here.
The Another message is quite radical and too hard to believe isn't it? Yep, these two fine gentlemen have been at it now, never varying and spending lots of time for over three years now. The more time that goes by, the more right I know they are. I'm in no hurry to participate in their new paradigm for even with physical gold, I will probably wish for a return of the "good old days". History is in the making. Let's hope this chapter can be written without bloodshed.
Thanks JavaMan, for your reassurance. Should we all become "Rebels", What better company.
Whew!, Banish the thought of being paid by the case in "SPAM".
Slingshot
Hey ThaiGold - thanks for the response. As I said, I don't care to debate the merits of either view. I simply read all I can and try to come to some kind of conclusion as to what I need to do.
I will tell you what I perceive as some of what has been "predicted" and you may judge for yourself as to whether these have come to pass.
ANOTHER claimed the CB's were buying us time by supplying gold to the market (10-5-1997). He claimed further that as long as gold stays cheap in currency terms, oil will be in good supply (10-7-1997).
"Gold is cornered. Plain and simple. No complicated theories, no options problems. The commodity value of gold was forced so low in paper terms that all of the new mined gold, going out some 10 years is spoken for. Between the third world buying physical gold and the jewelry industry (same people buying) there is none left for the oil states! They do value oil in terms of gold, but not IN the paper currency price of gold! How much is gold worth in terms of oil value? Just stop supplying gold to them in ultra cheep US$ terms and you will find out by watching the currency price of oil! In any event, LBMA has traded so much paper/oil/gold that any rise in the currency price of gold will implode them. The CBs must become the full primary suppliers of gold or the system as we know it is done.
"One last note: No form of paper wealth will survive the financial crush once the CBs stop selling!" (10-9-1997)
"There is no end to the amount of paper contracts that can be written and sold to drop the price of gold. The large players that I know have no problem with this. They are not traders." (11-1-1997)
Just one more ...
"At this moment in time and space, the price of oil in US$ terms is about to roar! It will crush the Pacific Rim and South America. It will drive the US$ sky high in terms of other major currencies but the dollar will collapse in terms of gold! Short term interest rates in the USA will be driven thru the floor much the way they have been in Japan from the early 90s. This will be done to combat a imploding equity market. Long government bonds will almost stop trading as their yield soars from the oil price fears of "inflation"! Because of todays "new digital paper markets" this entire act will be played out in 30 days or less. Yes, you are right! During that time we will have inflation and deflation." (11-2-1997)
As you can see, ANOTHER had this inflation thing down way before The Stranger and others came along. All I'm saying is some of us have been following this "trail" for much longer than you realize and we haven't been disappointed with our guide. I could go on and on with this stuff but I think you get the idea. Please don't consider those that agree with ANOTHER as "lemmings". I for one consider that something of an insult as "one that can't think for himself". Indeed, he has made me think, and for that I will always be grateful.
Did you guys read Trail Guide's Gold Trail message the other night? He mentioned several times about how ancient people (except the super-wealthy) spent their money on tangible necessities and barter items, not gold. In fact, he mentioned it so often that I wondered if he was giving us a subtle hint about stocking up for hard times! It was like: "buy what you're going to need and use your excess money for gold."
In response to your CavanMan question about Greenspan; I made my reply a deep and philosophical ramble, hoping to draw out some other's concepts and opinions about him. For some reason (smile), I feel I know the man and his reasoning, in depth, and wanted to see just what others would do in his shoes. A few replied and I will later, in kind. Perhaps, to our good poster PHinLA's writings, yesterday. Hope his power is still on (grin)!
As to your / our little bet (smile),,,,, I can dump a few K trying to make a point about physical gold vs futures, but dropping a US$ to Mr. Kosares over England would mentally and politically break me,,, Ho! Ho! Ha! Ha!,,,,,, Actually, I don't feel that you are a gambler, but business men of your stature must take public risks on occasions, no?,,,, So, on that account, I will not feel good about taking your money (grin). Besides, being so positive of my new gained one US dollar of wealth from USAGOLD, I already converted it into Euros and invested it (huge grin!) Ha! Ha! Time will tell, my friend!
To comment on your post earlier:
Adrian van Eck doesn't miss a thing and is usually right in the middle of every political motivation that's flowing at the moment. My observations are that this is but another example of the fluid political events we follow and do concur that the methods indicate open economic trade warfare
behind the screens. Indeed, yourself, myself and anyone following the flow of comments here at USAGOLD are attempting to measure the impact of these moves upon our respective currency / economic zones. Even as these nation states combat each other, behind the doors for an upper
hand.
Boy, I have a hard time replying any better than our Mr.CavanMan did in his (01/26/01; 19:07:51MT - usagold.com msg#: 46590) and everyone should read it again. You have been holding back on us sir (smile).
His point to you, Michael, is that of history and the ebb and flow of greatness in nation states: ---
--"The UK trade flows to the East naturally. As usual, your thought is excellent. However, the British being primarily a conservative people will not make a (quantum) leap of faith across the pond I do believe. Rather, they will be a key member of the EC over the long haul."---
So, I can only support his complete post with my comments followed with several copies from Dravos.
My Coment to a few others:
Codoleeza Rice, G.W. Bush's foreign policy advisor, is only doing her job. But, her proposition alone does not negate the obvious; the US in coming off an economic peak inspired by a huge Fed engineered currency inflation. And, because this dynamic is happening at a point and time unique in
history, world reserve currency trends will now control how the US handles this particular liquification of it's system. This simple point is painfully in plain view throughout the Euro Zone block. It's on record within so many ECB, French, BIS and multi EuroLand publications we cannot begin to repeat it all. They (EuroLand) saw our expansion for what it was, knew it's reason for building, noted that our dollar was driven to "overvaluation" by political means, and knew the Euro "under valuation" was but a passing thing. The British were not yesterday, and are not today blinded to this fact. They, as have other dollar trading blocks, completely based their financial structure upon an endless extension of the world's present reserve currency structure. Yet, today, for the first time in modern US history, there is a real risk that that reserve structure may fracture,
taking those financial houses into a hyperinflation with us.
Bringing Britain into NAFTA would be a great accomplishment and is as good as any a political and economic point for the new Bush people to aspire for,,,,, but points are for arguing while reality is the game that wins votes. Do we really think England will dive for this even as Mexico reveals the danger. From Dravos:
Mexico Will Seek New EU Trade Links
Alan Friedman International Herald Tribune
Friday, January 26, 2001
Fox Wants to Offset Potential Harm to Growth From U.S.Slowdown
DAVOS, Switzerland President Vicente Fox of Mexico said Thursday that the U.S. economic slowdown could damage his country's growth target this year, but he said he would work to replace lost U.S. trade and investment by forging new commercial ties with the European Union.
"The slowdown in the United States could affect our projection of 4.5 percent growth in 2001, but we want to substitute it with more European trade and investment and make use of the recently signed trade agreement between Mexico and the European Union," Mr. Fox said Thursday night in an interview in Davos with the International Herald Tribune.
Mr. Fox said he would soon visit France, Britain, Germany, Spain and Switzerland to promote Mexican exports and to seek fresh European investment in Mexico.----------------
-------------
HA! HA! Well, Michael, CMan, what do you think of my rambeling on? Can't you just see Britain wondering why they are coming in the front door while Mexico is running out the back? Oh Boy!,,,,Here comes Fox, a smart cookie I might add, signing trade expanding pacts with EuroLand because he can't make his numbers with the US. So what is England going to trade to us that could undercut Mexico? Makes you think, right? (smile)
Also,,,,, Why in the world would Britain want to joint up with this bunch, at a period where they are all driving each others profit margin down the drain, just to recessitate a plunging economic and financial structure built on dollars? And,,,, If anyone doesn't think that Japan does not stand head and shoulders within our little NAFTA organization, they better get new a new financial planner because their own thinking is way off. Their Yen economy is back boned into the USA and it's dollar. More from Dravos:
Japan Fights to Counter Gloom Over Its Economy
Alan Friedman and David Ignatius International Herald Tribune
Saturday, January 27, 2001
DAVOS, Switzerland Prime Minister Yoshiro Mori of Japan will use an appearance here on Saturday to try to counteract the extreme gloom about prospects for the world's second largest economy that has emerged at the annual economic conclave here.
Mr. Mori's appearance at the World Economic Forum, the first ever by a Japanese prime minister, comes as bankers, business executives and economists are wondering aloud if Japan is in recession. Fears are mounting that, after a decade of anemic growth, the country's political paralysis, high debt and snail's pace approach to deregulation and reform could combine with the U.S. economic slowdown to damage global growth prospects this year.
According to a senior Japanese official familiar with Mr. Mori's speech, the prime minister will offer both hope for the future and a frank, even humble assessment of what the official termed "the lost decade."--------------------
Fed Chairman Warns Growth 'Is Close to Zero'
Mitchell Martin International Herald Tribune
Friday, January 26, 2001
Greenspan Backs Big Tax Cuts, A Political Boost for Bush Plan
NEW YORK The U.S. economy has virtually stopped growing, Alan Greenspan, chairman of the Federal Reserve Board, told Congress on Thursday, a surprisingly gloomy view that increases the prospects for a deep interest-rate cut next week.----------------------------------
So, Michael,,,,, the fifty-first state? I don't think so. If they do it will be like buying all kinds of leveraged gold substitutes several years ago when some thinkers where saying stick with the real thing instead (smile). By god, that would have been the type of political advisor the Queen needs today!
Britain, like Physical Gold Advocates today, may show some ware from linking to the huge economy of the new Europe, but those minor scares will be nothing compared to the loss (like gold paper players) of going deeper in dollar leverage or staying at all within the US financial and economic trading block. Just at the time in history when we must super inflate away our debts.
------------
Further to your post, Michael: They cannot keep the pound as it stands. It's almost a dollar derivative now. In fact, I know they are monitoring the Gulf Cooperation Council, looking for pointers on how they will structure a parallel currency that uses Euros for settlement, all prior to
joining. Besides, they (HM Treasury) have already shown their hand to us by clearing out as much of their favored Bullion Bank gold debts as possible before EMU.
As to their becoming a halfway house, bridging trade between a future inflating NAFTA arena and EuroLand? Great idea, but Mexico is already showing that won't work. They and everyone else will undercut Britain long before they can "rule the waves again" (smile).
You are a good historian, my friend, and any assessment of world power flows requires just such an input if one is to understand these modern moves. But this time the real history is before us and we will be a big part of it! Oh yes,,,,,,,,, we will!
Now, I'm going to take my little boat and go fishing. Mans got to eat, you know. Be back later, after a fish dinner! (smile)
Hey CM - as you can tell, I haven't had my coffee! Apologies to ThaiGold and yourself for the error.
Funny thing - I've resurrected all these ANOTHER posts from Kitco and am having a ball going through them. I remember at the time I read them I had to go over them several times as I was having great difficulty understanding what he had to say. I read them now and they make perfect sense!
E.T. msg 46627After reading the post I get the feeling that the CB's are not in control of this gold manipulation but the oil producers. They may have been one time, no more.
Considering how the oil producing nations in the east would love to see the oil gussling west in dire straits as they suck the life out of the CB's (gold). Run the price of gold by increase in oil value. Which calls the gold shorts and dumps the markets.
The only thing missing as per ThaiGold is the drugs and the CB's are force to launder the money by Blackmail I presume.
I think I just had a brain spasm.
Leigh, I read the message and took the hint. Hurricane Andrew was a real good teacher also.
Yes, ThaiGold, I am well aware of Ted Butler's work, but an "UNDERGROUND" supply of silver would throw his figures out if kilter. Thus the questions re this issue. Nothing definitive that I can remember out of David G's work as to pinpointing a large and hidden silver supply. If it is in existence, it is keeping a lower profile than its bigger brother.
So, until proven otherwise let's state the following:
There is quicksilver, paper silver, spec silver, colloidal silver, Lone Ranger Silver, & ThaiSilver, BUT NO KNOWN SIGNIFICANT BLACK SILVER! Fair enough?
Dissing inflation @Sir Peter Asher, 01/26/01 msg#: 46596
"Sheese Journeyman, what's gotten into you tonight? ... Your riding around with your lance tip unsheathed!" -Peter Asher (01/26/01; 20:37:36MT - usagold.com msg#: 46596)
Oops!! You're right!! Thanks!! Only your friends will tell you some things. Ah, hold on a minute. z-z-z-z-z-i-i-p There, now. Lance tip all covered up! ;>
By the way, anytime you want to DISS inflation, I'm with ya!
Regards,
Journeyman
P.S. I learned something from your homework, Sir Peter. Thanx!!
Make that dinner "Fish & Chips." Paid in pounds. (Laugh)
We shall see, my friend. If I accomplish nothing more than to draw you out, I've accomplished much.
Thanks, FOA.
Working on News & Views this weekend. Received this via our good friend, Buena Fe. Something that appeared yesterday in the Financial Times and points up the growing rift between Bush and some on Wall Street. It will be in the Feb issue with my comments.
"Conservative Republicans see the criticism from Wall Street [of GWB's economics team] over a supposed lack of market awareness in the administration as code, indicating that no nominee as yet is an obvious supporter of big financial bail-outs. For them, Mr. [Charles] Dallara's [who will head a new economics group within the National Security Council reporting to national security advisor, Condoleeza Rice, and ecnomics advisor, Lawrence Lindsay] would be a source of concern as he is viewed as a strong proponent of rescue packages. They are critical of the role of Robert Rubin, the Wall Street banker who was the chief economic policy-maker of the Clinton administration, as being overly attuned to his Wall Street friends in choreographing financial rescues in Latin America and Asia. " --- Financial Times, 1/25/01
All: I very much appreciate the articles you send by mail and fax. Keep it coming. . . .
The UK is part of EU, so forget any other 'unions'. There is only one more step for full integration- the monetary union. That will come well within the next three years - most likely two.
Don't worry too much about the 'one world' bit, it is the 'agenda' but quite some way down the road. We'll all be under the sod long, long ago by then.
Keep your eye on GOLD ( and your MIND)
It won't have to rise all that much for those mines to be profitable. And gold coinage will have a strong revival, certainly for collectors.
This excerpt, or Freudian slip??, perhaps, is from a front page article on GWB's tax cut proposal in the Friday USA today....
But momentum is clearly building for larger tax cuts. Even Senate Budget Chairman Pete Domenici, R-N.M., a longtime fiscal conservative, sounded like a tax-cutter on Thursday:" I don't think that we have to be concerned about spending too much money because there will be a lot......around."
Reading the DRUDGE REPORT, as posted in msg 46619,have come to the reality that if they had done the things reported in the DRUDGE REPORT. We are in deep trouble. I can not print the words I want to say. If they would do these acts upon the very symbol of the free world, what do you think they did to us with executive orders. I'm an old salt, cut from a different jib. Thank you Beowulf for bringing it to light.
Need to blow off some steam now.
Slingshot
I think you are sort of on to something pertaining to money at zero velocity being no longer money, but with a caveat.
Money is a future claim against real wealth, be it real physical goods or some sort of service. If that claim lays dormant, such as being stuffed under a mattress, it will have zero velocity. If it remains there forever, it is no longer money in any real practical sense, no different than if it is incinerated.
The caveat is that this money may, at some time, be pulled out from under the mattress, and once again exert its claim on things real. The Russians learned this all too well, post USSR. When the availability of real goods returned, which were long suppressed in soviet times, this resulted in the vast hoard of rubles held outside of their banking system returning to circulation. This, in turn, resulted in money competition with the government printing presses, something no self respecting Kleptocrat could tolerate. As a consequence, almost all of the cash rubles held outside of the banks were voided, in effect robbing many at the lower end of the economic spectrum of their meager savings.
I add as a final thought that those with the foresight and means to hold gold or US dollars fared much better.
Clarification from Pete The Prophet @escapethematrix msg#: 46637
"Hmmm.......What on Earth could he mean?? (smile)" -escapethematrix msg#: 46637
He means - - -
What would happen if the Saudia Arabians said they didn't want to be paid [for oil] in
dollars anymore, but wanted instead, to be paid, say in yen. There would be inflation
that would make the 15 to 20 percent inflation in the early 80's look good. -Sen.
Pete Domenici, R-NEW MEXICO, C-SPAN II, 18 May 1995 ~12:33:55 PM
AND to add perspective for any new folks who may be lurking here about - - - -
Mr Jacques Santer, former president of the European Commission, has called on Gulf
Arab oil exporters to price their crude in the euro rather than the US dollar as a
means to stabilise the oil market. "It could be the instrument to consolidate oil markets"
and would be less affected by US foreign policy, he told a Gulf-Euro conference in
Dubai. -Sante r calls for oil to be priced in euros,The Irish Times 10/08/2000
In this connection, it must be noted that Iraq is attempting to switch to the euro as its
currency for settling oil exports, and that Venezuela [U.S.'s largest (non-OPEC) oil
supplier -LRW] is reportedly planning to follow suit. Euroland has a lot to gain
from this development because it will eliminate currency exchange risks. -TERUHIKO
MANO, Euro attracts global audience as option to dollar-based trade,
JAPANESE PERSPECTIVES, The Japan Times: November 20, 2000 [repeat link]
http://www.crbindex.com/news/story2203.htmlI posted this late last night and asked if anyone could clarify - some may have missed it. I've done some checking since...here's the blurb from Bridge:
DAVOS: Swiss Central Bank's Roth won't say if rates have peaked
Davos--Jan. 26--Swiss National Bank (SNB) President Jean Pierre Roth said the Switzerland's gold sale is proceeding as planned and the targeted 220 tonnes sales quota will be achieved by the end of March. ( Story .15963 )
---
Now, as I said last night, something does not seem quite right to me. Here is a message by turkey hunter from 12/9/00 which I thought I recalled last night from memory:
turkey hunter (12/08/00; 20:01:37MT - usagold.com msg#: 43274)
Swiss National Bank wants to get rid of gold
SNB says has sold 160 tonnes of gold so far
ZURICH, Dec 8 (Reuters) - The Swiss National Bank said on Wednesday it had so far sold 160 tonnes of excess gold
reserves under a programme coordinated with other central banks and aimed to sell the same amount by the end of September next year.
"To date, 160 tonnes have been put on the market and we intend to sell the same quantity between now and the end of
September 2001," SNB Vice-Chairman Jean-Pierre Rothsaid in the text of a speech to be delivered at the SNB's quarterly
news conference.
The SNB started its gold sales programme in May, under which it plans to sell 1,300 tonnes of excess reserves.
---
My memory was right on this. September is the end date for quota fulfillment - not March. They said that 160 tons would be sold by September, 2001. Now, the Swiss are saying they WILL have sold 220 tons by the end of March is quite possibly 220-160= 60 tons from early-December thru the end of March. Or is it?
Is this a misquote, or is there some significance to 220 tons by the end of March of which I'm not aware? First they say 160 tons by September 2001, then they say a "targetted 220 ton sales quota by the end of March". Are there limits per quarter also? And the other, less likely possibility - have the Swiss decided to sell 220 tons from January-March 2001?
Its so very nice to see you contributing your razor sharp observations again. You said: ""He mentioned several times about how ancient people (except the super-wealthy) spent their money on tangible necessities and barter items, not gold."
JavaMan: Yes, but I got the impression their money WAS gold and that no hoards were found because it was their custom to spend it (on essentials?) while out and about.
And..."In fact, he mentioned it so often that I wondered if he was giving us a subtle hint about stocking up for hard times! It was like: "buy what you're going to need and use your excess money for gold." "
JavaMan: And it seems our Trail Guide is not alone in his advocation of an orderly plan to buy what you need [with fiat] and convert the rest to [physical] gold.
I believe it was Aristotle (who measures his gold in pounds) who's reasoning first caused me to see that rather than kicking and screaming about our currency situation, it was much better to simply pay off debt and settle transactions with dollars of the day and then, on a regular basis, convert any excess to physical gold...real savings.
I was thinking of a post you made some time ago where you pointed out that Trail Guide had made the statement: "in the days to come..." and you queried him on it. Looks like those "days" could stretch out in to weeks or months or...
But, be that as it may, we sure are witnessing some interesting times with the all that Dr. Greenspan is confronted with. I think 2001 is going to be a very interesting year.
MK-For the same reasons, Ireland is really European (also) despite her very close ties to the US (and I mean CLOSE). Despite all the US investment there, her best customers are East not West. It always boils down to sales Mike :>):>)!
When I first started working in the electronics industry, I had a boss from Taiwan. While over in Taiwan he was custom manufacturing FM radios and using as I recall, a 9 tube design. One day a customer came in and requested a 10 tube radio. My boss informed him that the 9 tube radio was a very good design and more tubes were not necessary. The man insisted that his neighbor had a 9 tube radio, so he had to have one with 10 tubes. It had to be better right? My boss didn't want to turn away a paying customer so he agreed to make the man a 10 tube radio. He took his standard 9 tube design, punched an extra hole in the chassis, mounted an extra tube, wired it so the filaments would light up and sold the man his 10 tube radio. The man was very happy because he could show up his neighbor!
These number games have been played probably since the dawn of man. When transistors came along, the games continued. The original AM radios were six transistors but it was not long before 9,10,12 and even 16 transistor portables were on the market. The best portable AM radio ever made was the Zenith Royal 500. It blew the competition away on sound quality, sensitivity and selectivity. It sported just 8 transistors.
In the 60's, the number games continued with stereo amplifier power numbers. Amps that could barely wheeze out 15 watts, were bogusly rated at 100 watts with trumped up rating systems. A little 25 watt McIntosh power amp destroyed the ersatz 100 watt amps in sound quality. Still, people bought the numbers. In cars also, horsepower numbers were and are considered selling points.
Now here we are in the next millenia and the games continue with CPU MHz ratings. But you can take 2 systems with identical processors, memory, operating systems etc. and one will trash the other. The difference? The motherboard engineering. A designer who knows what he is doing and has the design criteria to let him run (ie. the boss will let him design a more expensive board) can build a much faster system. But there's no numbers in doing this. People want those d*mn numbers of course! And the numbers just don't tell the whole story do they?
Hey, I've got 100 golden dollars. Care to trade them for a lonely gold eagle? More is better right? ;-)
Did I miss something before or did your writings just predict another quantum leap in the future woes of the dollar/$ value of physical gold.
I thought I read...gold will be worth 1000 times its current price. That would be 265,000- 275,000 dollars per troy???? The highest I saw before was $30,000/troy.
Am I imagining things or was it a typo?
If not, converting $'s to gold now may be the best coup in the history of global finance.
Much better than the magical "Philosopher's Stone", which you had to have bunches of lead first to convert to gold. To think just a ton of green paper can convert more without magic than the magical Philosopher's stone with a ton of lead. But then again, it IS said that most magic is a trick of perception.
With your writings, we have been let in on the secret of the trick before it is performed!
These are the words I read and later realized were a jump shift of valuation prediction
From the end of the piece on Troy, Helen, and all. It's said she had hair of gold.
"...Consider these possibilities well. In that gold today is in a much lesser existence, compared to modern goods supply and lifestyle enhancements, when comparing it to it's value in life in the past. It's true worth as a wealth medium could be a 1,000 times higher! For it to return to it's ancient
position of true asset wealth, for trade outside the modern currency relm, we can see where it's European benefactors have once again placed it "On The Road" to much higher fiat currency prices. ..."
in reply to ThaiGold's opium/gold theme is one of those "Secret Histories" that ties together a lot of recent world events, as well as going way back, if true. It's one of those "makes me feel crazy what's going on behind the scenes" histories, and "what world have I thought I've been living in". "Boxed in" with regard to any ideals of a better world, is another feeling. Hey, ain't the Internet great! (And why didn't I provide the link? After reading it, you bet, I'm feeling paranoid, too!)
Well, I don't think it's nearly the flip-flop the press are making it out to be. Why?
1. Greenspan testified last year to PREFERRING deficit reduction. However, he stipulated that if he had to choose between tax cuts and more government spending - he'd take the tax cuts.
2. Congress has been throwing money around like a bunch of drunken sailors out on liberty.
3. Ergo, Greenspan supports tax cuts.
In addition, it may also be that Greenie sees the economy falling off a cliff and would rather inflate (tax cuts, rate cuts, increasing money supply) than have the economy tank and go into a disinflationary recession/depression as happened after the '29 bubble popped. In our situation, inflation is the least of his problems...there's nothing like going from nearly full imployment to high unemployment -- drastic changes like that punish politicians (and bankers) severly.
Tree in the Forest, you are absolutely right, and it can all be explained in two words: ego and hype. I think there is a valuable lesson to be had here if only people would refuse to be swayed by the onslaught of hype that is ever present, then the majority of them would not fall victim to their own ego.
I know for a fact that in the seventies, when the transistor was taking over all things electronic, McIntosh was one of the finest pieces of electronics available. And all tubes! It delivered a softness to music whereas transistors produced a hard, glassy sound. It may still be one of the best but I've lost touch with the product line. I know one thing, when the day comes that I need to replace my home sound system, I'm going to give them a hard look...if there still in business.
Henry, even if gold was monetized to cover all the dollars in existence, I don't think it would be anywhere near six figures. Do you?
Sir lamprey_65, I would be good for nothing if I did not provide your desired help on this
RE: your (1/27/2001; 13:54:19MT - usagold.com msg#: 46642) on Swiss gold sales
The numbers quoted in the news reports you have cited are quite correct, though their odd choice of phrasing has no doubt contributed to your misinterpretation.
Here are the two key news briefs:
--------
Davos--Jan. 26--Swiss National Bank (SNB) President Jean Pierre Roth said the Switzerland's gold sale is proceeding as planned and the targeted 220 tonnes sales quota will be achieved by the end of March.
AND
ZURICH, Dec 8 (Reuters) - The Swiss National Bank said on Wednesday it had so far sold 160 tonnes of excess gold
reserves under a programme coordinated with other central banks and aimed to sell the same amount by the end of September next year.
--------
To advoid unnecessary confusion, let us not start with an analysis of these two articles, but rather with what I know to be our present reality.
We are familiar with many "years", such as "calander years" (which cycle from January) and "fiscal years" (which cycle from any chosen starting point.) The "Washington Agreement years" are akin to "fiscal years" which cycle from the end of September.
In the First Year of the Washington Agreement, the Swiss allocated 120 tonnes through the BIS. In accommodating quotas and the other actions of their co-signers, the Swiss will be allocating only an additional 200 tonnes during this Washington Agreement Year Two. This would bring their two-year total allocation to 320 tonnes, which is the condition referred to in the second article when they were at the halfway point of 160 tonnes, expecting to "sell the same amount by the end of September".
Their stated goal regarding the 200 tonnes in Year Two was to allocate half (100 tonnes) during the first half of Year Two, which is the March deadline we see referred to in the first article above. bringing the cummulative total (along with Year One) to 220 tonnes.
An abacus helps. Got beads?
Rounding out the balance of the 400 tonne quota for Year Two, we expect to see the full delivery of 150 tonnes from the UK, and the remaining 50 tonnes this year will come from among portions of the Austrian's remaining WA allocation of 60 tonnes, and/or the Netherland's remaining 200 tonnes yet to be reallocated within the scope of the WA.
Here are a few more parses from ANOTHER's old stuff. He has made several predictions which, as of yet, have not come to pass. Nevertheless, his writings are fascinating. I may post a few more later if the forum stays slow.
"The actual buying of gold ( no other metals ) by huge players is not a prediction, it is ongoing. In 1997 it exploded!
The price of the metal in currency terms will be made for all to see as it moves quickly upward for a very short
period of time ( 30 days ) . After that only black market traders and third world noones will understand it's price!
When is this going to happen? I have no idea. Is there anything to look for that will tell us when the problems have
started? At first the US$ and gold will go up together against all other assets!" (11-3-1997)
"Turn slowly now and view all directions. The wealth that was had was not real. The Pacific Rim started, now
South America. Next will be Europe closely followed by the US. Remember, all currencies are the same now as
they are "digital paper"! Nations will defend the system at all cost They will never sell US$ treasury debt as that
debt is their currency! The dollar will soar as a final defense! As part of this defense they will allow oil to rise as
oil is priced in dollars. How do you get oil to rise? Today, we stop our CBs from selling gold!" (11-5-1997)
"The world currency system has, for years been little more than digital credits backed by "usage demand". In the
long run it was oil backing the US$ that kept it all together! It truly is strange, that in the end it was gold that
backed oil! In a even more strange twist, the loss of the LBMA gold market will bring the system down!" (11-13-1997)
"The BIS will not allow the distribution of all gold to settle claims. The mines of the world will be forced to sell to
the BIS at the "locked" existing commodity price of gold. This will happen over many, many years as no other
"official" market outside the BIS will exist." (11-16-1997)
"But what value gold? All say "it is only a commodity subject to supply and demand"! Understand me, Demand and
supply is written by BIS and $15 oil can cost $250 gold or $10,000 gold, whatever is required! $250 gold and
LBMA will live! $10,000 gold and LBMA is sacrificed!
"But, it will never come to this. The oil "understanding" was broken by the Asians. More gold has been sold than
can ever be covered! This market is not the same as the past. One day gold will start up and BIS will deal with it
the only way possible!" (11-22-1997)
"The future will look back at us with respect, as we knew not what was happening! A day will come, sir, when no
paper dollar will pry gold from your hands! In that day, you will be too smart for such foolishness." (11-23-1997)
"How will this all end? As the CBs never sold much of their gold, they are still locked to the deals thru the BIS. In
the real world it was stocks of gold outside the governments that got traded. And that trading multiplied many
times. Today, more gold is traded than exists! This paper today, has become the "gold pricing standard" without
backing. There is no way out! As we have now reached production cost, we have reached, "THE END"! Without
real physical to supply the oil states, they WILL bid for gold with oil! The BIS will do the only thing they can, halt
all trading and declare gold a "world oil currency"! To that end, all forms of paper gold will burn. How long till
this starts? I understand that the CBs are slowly winding down lending, then sales. This will, no doubt start a
paper panic at some time. It could take weeks or a year, I do not know." (11-28-1997)
"As a large tanker takes time to turn, so will the coming change in oil values take time to see. We have seen the last
of cheap oil in US$ as the oil states are no longer taking paper gold! This change in trading will have a great future
impact on oil/gold/US$." (11-30-1997)
When Another first began posting it seems, he expected the events he forecast to come to pass in the near term--then. Now, almost four years later, you continue to spend much time and effort forecasting the same message. Why? Also, what changed the timing of those events; Asia, Russia and LTCM etc? The global economy and monetary regime was not stable enough to absorb a shock of the magnitude you suggest???
ET -- Thanks for bringing back and excerpting Another's posts; I'd been meaning to re-read and you've probably given me the appetizer I needed.
CM -- Were Another & FOA looking more at the fundamentals (as we tend to do) from 1997's viewpoint. Thinking that big investors and institutions would flock to physical as they saw what was on the horizon.
What did they underestimate? The flight to dollars during world crises? The willingness of US consumers to load up on debt and home re-fi's to boost the bubble? The luring in of Europeans into the dollar bubble? (Another mentioned the strengthening of dollar with oil going up -- didn't foresee these other consequences of dollar rise?)
All of these result in a longer survival of dollar -- and steeper plunge.
Also -- the prospect of Euro on the horizon was not enough to shake the dollar world. Needed to see it in action for a couple years before believers would be made.
Dollar has had more legs than Another/FOA imagined then. Timing was off. So, is dollar stronger now for having survived longer? No; it just has fewer left of an unknown number of rabbits to pull out of its hat. Timing is the hardest part of contrarian prediction. Trend followers got it easy -- until.
Hey, why didn't we all short dotcoms at NAZ 5000? Your best contrarian bets are made when your stomach is turning somersaults, right?
"Nations will defend the system at all cost They will never sell US$ treasury debt as that
debt is their currency!"
JavaMan: Given the time this was said, it seems to me to be incredibly prophetic as today we read discussions on that very topic, yet it seems no one is breaking ranks (as prophesied).
And "The dollar will soar as a final defense! As part of this defense they will allow oil to rise as
oil is priced in dollars."
JavaMan: Ok, oil is up from $10 to $30 dollars...also prophetic given the date..
And finally "How do you get oil to rise? Today, we stop our CBs from selling gold!" (11-5-1997)
@ET
I would like to have a copy of all your ANOTHER archives if it would be possible for you to email them to me. I would like to put together a webpage someday, although right now I am very busy. r_o_s_s_l@yahoo.com
@JavaMan
My experience with Win2000 is that 256mb ram is the minimum for acceptable performance. If you needed that much for your applications in NT, now you need to add more for the OS bloat of Windows 2000.
@Tree in the Forest
Thank you for the history. JavaMan's problem is not so much a hardware issue as it is a Microsoft issue with the ever expanding memory requirements.
As a side note, the microprocessor performance of the AMD Athlon has now surpassed Intel in a big way. My next prediction for 2001 is that Intel stock takes a big swan dive compared to AMD. (not investment advice)
Here are several more passages Cavan Man. Good question for FOA! I want to post one post in particular in its entirety. Hang with me!
"Oil is only priced in US$ worldwide. Gold is only priced in US$ worldwide. It is important that this process of
dollar backing continue, as it is the only thing keeping this "digital currency" alive! It is also important that all
other currencies seek the US$ for backing, as they would not survive on their own. Why would not these countries
just hold oil or gold for backing? Because oil is not buried in their back yard and real gold would bankrupt them
in a minute. You see, a country can buy all the paper gold they want as that gold remains on deposit at the BIS
controlled CBs. But, if they try to buy real gold outside the LBMA system the price would explode and the BIS
would not come to rescue their currency. All real bullion outside the system must remain available at production
cost prices ( in US$ ) for the cross trading of oil thru the LBMA. There are only two threats to the world fiat
currency system at present. The oil states could stop buying US$ for oil and drop all paper gold for real bullion.
Or, the masses could buy up all the physical
supplies thereby breaking the OIL/GOLD/US$ bond. The paper gold market controlled by the BIS/LBMA system
is, alone equal to more than all the gold in existence. This market works like a hybrid currency using
approximately twenty to forty percent of all CB gold in leased form as backing. The paper behind the lease is a
form of CB/gold and is used as a "fractional reserve" that has built this huge market. This system has worked and
does work well. You have but to look at the good value that is received when dollar debt ( digital currency ) is
purchased with oil. The world works! But this system cannot continue. There is a limit to how far gold can be
inflated in quantity using "fractional reserve leasing" as backing. The fatal flaw was found in the "forward sales"
of unmined gold. The whole system counted on the expansion of cheap mining techniques to supply much more
gold at a cheaper price far into the future. This happened to a degree for a few years but then just leveled off. Now
the LBMA continues to flood the market with paper gold as if nothing has changed! But it has, we reached
production cost! That wasn't suppose to happen until the mining industry had raised supply many times
what it is today.
"To close:
"Notice that we say "they use oil to buy gold" and "they use oil to buy dollars". You should try to think in these
terms as oil is the real value here. Oil functions as the true gold for the modern world. Indeed, it was only when
the world started needing oil for everything that gold was dropped as backing for the US$ and replaced with oil!
"The falling price of physical gold only hurts the mining industry ( and it's stockholders ) and leveraged paper
buyers. All others benefit from a lower value of gold. Look now as even the western public are buying coins. They
help themselves even in the face record Dow Jones.
"Will the BIS try to settle this unbalanced market by destroying LBMA? Or will they drive the CBs to lease another
20% in an effort to inflate this "paper gold currency". Just like the fiat dollar, if inflated it loses value. This is not
lost to the oil states." (12-12-1997)
"Someone once said, "noone wants gold, that's why the US$ price keeps falling". Many thinking ones laugh at such
foolish chatter. They know that the price of gold is dropping precisely because "too many people are buying it"!
Think now, if you are a person of "great worth" is it not better for you to acquire gold over years, at better prices?
If you are one of "small worth", can you not follow in the footsteps of giants? I tell you, it is an easy path to
follow! An experienced guide is not needed for this trail, look around you and see. The real money is selling ALL
FORMS of paper gold and buying physical! Why? Because any form of paper gold is loosing value much, much
faster than metal. Some paper will disappear all together in a fire of epic proportions! The massive trading
continues at LBMA, but something is now missing? The CBs are no longer lending! They will not anymore! We
have reached production costs. Oil will have nothing of "gold paper" if gold must stay in the ground! And a CB
values the wishes of oil far above it's return of leased gold! Hear me now, "if gold tries to go lower than US$
$280 the BIS will buy it OUTRIGHT in the OPEN for all to see"! They must! They will! I know. For no currency
system could stand if "Oil" were to bid for gold!
"Oil has kept "the deal" as the CBs sold paper to lower golds price! All is fair. Asia will bid for gold not as in the
past. They now know that the free flow of oil has more value than the Pacific economy. But the price that was paid
may be more than the world currency system can endure.
"To close:
"The US$ has risen on a flight of fear. That will now end as the LBMA shorts are given to wolves. If this fire burns
too hot, gold will turn and it's trading halted. The price of oil will explode as gold becomes the "world oil
currency"! Even now oil has locked the IMFs gold, Asia will bid against them no more. We come to extreame
times.
"Risk not your wealth in paper, we enter a period of truth." (1-10-1998)
"CMAX: I can not oppose your long term view. But, I can change the contents. Oil went from appx. 1.50/bbl./+/- to
$20.00/+/- and the world changed. Many 3rd world countries ( mexico, exp. ) have been using the same currencies
for many years, even as they were destroyed. The people only adjusted by adding the US$ as a value/mix. The
same will happen when/if oil bids for gold. All nations will use the same digital currencies for all trade, but will
also add gold to the value. The world will not end, it will change! As some say "not enough gold to use as a
currency", I say "gold not valued high enough to use as currency". At a high enough value ( price ) it is an excellent
currency! Oil now backs the US$ as a "digital world reserve trading currency". When oil backs gold as an
"additional value to digital currencies" your view will be different." (1-11-1998)
This post stands out for its encompassing of the history of currencies and what they have wrought. Perhaps not coincidently FOA has returned to this theme recently. In light of today's energy markets, it is a fascinating read.
"For those of simple thought, such as I, gold is good to own.
"But, for those of need for reason, read from one who speaks to me:
"The Cornering of Gold!
"The final outcome of "Too Much Oil", "Too little Gold" and "Worldwide Digital Currencies".
"For years the governments could create currency out of nothing. But, during the last eight years, the modern
currency systems have taken the final step. As digital charges in a computer, they have become but "emotional
thoughts" of trading value. This is to say, "a currency unit exists only during the moment of trade". During this time,
when real things are in transit, paper currency has value as an expected "trade completion". It exists as a human
thought. Complete the transaction and the thought is gone, the currency unit dies.
"Think about it? If for a time the world commerce stopped. All would live from what they had for, say a week.
During this week, all currencies and the debts that back them would not exist! Without trade, modern currencies
have no use, no value, no purpose.
"During our modern age, a currency can be anything. Corn, lamps, cars, tables, anything could be used as a concept
for a digital currency. You see, it exists in concept only. Even gold could be used as modern money. The real item
is not used, only the concept of "how it would be used during the transaction of commerce". "Real value is not
needed for modern money, as it is only used as a trading unit"!
"What does all of this have to do with oil and gold? For most people, nothing. But for some people, everything!
You see, some persons do not want to hold an "operating business" and the present value that represents, as their
wealth. Nor do they want to hold encumbered assets or debts of others. Wealth, to these people, is not represented
by a "digital trading unit of commerce".
"History has shown how many persons, or groups of persons, have tried and failed while trying to corner a
commodity. Greed was always the factor, as acquiring real wealth to pass on to family or country was never the
aim. Using paper currencies ( or debts of the same ) to purchase these commodities, always brought on the undoing
of the scam. During some years, even gold was used as a purchasing unit, as gold was the currency of that time.
"But, today we come to a different period, with a different factor and circumstance. For during no period of history
has an entity used a commodity to corner another commodity! The intent is not to "corner", but the result will be
the same. This action is coming about because of a gross, huge mismatch of the value of gold and oil! We are not
talking about the price of these items ( in any currency ) . We speak of the total amount of physical gold,
worldwide and the total amount of oil worldwide. During the last twenty years, the world has made oil an
absolute necessity for life as we know it. During the same time, gold has been degraded to a "kind of commodity
that we may need sometime but, I'm not sure". With the public, government and the business community holding
these thoughts, it is easy to understand which item is needed first and which would be dumped. In this day, people
would sell gold for oil, no contest!
"Consider the amount of oil that is used daily. Consider the future value that this consumption places on reserves in
the ground. Compare this to the amount of gold consumed daily. Notice I said "consumed daily", not "traded
daily". Clearly, the consumption of oil compared to the consumption of gold places a much higher value on oil
reserves than gold reserves. With no replacement for the use of oil ( at present to lower prices ) and no "needed"
use for gold in today's thought, we have the ingredients for a mismatch in value of epic proportions!
"The supply of oil was a problem in the 70s. Several nations actually cut off the supply to make a political point.
Many thought that the "embargo" was an attempt at "cornering" the oil market. We may never know the true
reasons for the large increase in the price of oil, but one thing is clear. The value of oil in today's economy is of
far greater importance to maintaining present "asset values" than at any time in the past. Today, the future value of
all commerce is "well bid" into every asset value! Without oil in good supply , at a currency price that allows a
reasonable lifestyle, all assets would lose much relative value.
"This "need" for supply is not lost to governments or their Central Banks. No single asset class or segment of the
economy, by itself is more valuable than the supply of oil. This brings us back full circle, to the problem of
"digital currencies" and the "mind set" of much of the simple ( and rich ) third world persons. To many of these
people, wealth is the surplus of life's work that you pass on after death. Currency is something you, spend, trade
or hold for a few years. It isn't wealth.
"Gold ( and silver ) is "on the list", so to speak.
"This same mindset creates a worry in the back of many a mind in the oil states. It is clear to most, that even a small
amount of gold in the asset mix, makes one appear "less western" and therefore "less foolish" when the concept of
value and currency are discussed. But, the problem has always been that oil is "so large" in relation to gold that
any attempt to convert, even a portion of ones assets creates a distortion in the markets. Of further concern is that;
everyone knows that western minds don't like or want gold, but if they think you like it they will trade it up in
price for the sake of "sticking it to you".
"Enter the world of "paper gold".
"Yes, gold just like currencies has been "digitized". If you brought gasoline, made from oil sold under $20/bl, you
are part of this system! For just as the "digital currencies" are created for trading only, paper gold was created for
the trade of oil. In a very broad sense, it was created as an "extra" or "kicker" to allow the purchase of small
amounts of cheap gold in return for a full supply of oil. In reality, this gold paper represents the future production
of gold ( from the ground ) to balance the reserves of oil ( also in the ground ) . The huge amount of "paper gold"
traded and outstanding today is now in excess of all the gold in existence above ground! In essence, it is of the
same value as the currencies, "the thoughts of nations, blowing in the wind". The Central Banks gave value to this
paper by selling and lending some of their gold stocks. But, as economies became hooked on cheap oil, and
demanded more of the same, these same CBs had no choice but to use fractional reserve gold lending" to pump the
gold market.
"Now we approach the final act.
"There is one oil state that no one will play for a fool. The CBs will sell all of their gold or the nations will
nationalize all mines and operate them at a loss. One way or another, most of the paper gold market will be
honored. Why? Because oil will bid for gold if they do not! We are not talking about an oil embargo or rising oil
prices. Indeed, oil will become very cheap for those that can supply physical gold. This deal will not require the
agreement of all oil states. Only one can start this, the others will gladly follow.
"A large oil producer, with plenty of reserves and unused capacity, can say: We now value gold at $10, $20 or
$30,000/oz.. That is the rate we will use to sell oil. We will go to "full" production and offer at $10.00us/bl.. Pay
us in physical gold and USD ( or EUROs ) as a 50% mix to the above rate to equal $10/bl..
"It would be a deal like none other! Oil, worldwide, would drop to $10.00/bl and every economy would do very
well, IF they had gold. All gold would immediately be arbitraged to the above prices thereby creating a "world
oil currency" large enough to handle oil. This creating of a new "specialized currency" will be the result of the
first "commodity corner" that ever succeeded!" (1-17-1998)
JavaMan: And finally "How do you get oil to rise? Today, we stop our CBs from selling gold!" (11-5-1997) [Quote of Another]. This, I don't understand. Does anyone?
Lafisrap: How about this. The CBs stop selling gold (both
paper gold and the real thing). Less gold is thus available
to gold buyers. Subsequently, POG rises. Since the oil-producing countries are ultimately interested in gold, not dollars, in exchange for oil, they raise the price of
oil so that they can continue the oil for gold exchange via the dollar. Gold and oil continue to flow in opposite directions.
Normally there is a lag of about a year between a monetary action and its reflection in the real economy. Financial markets, however, often anticipate the real economy by up to 6 months or so.
The latest acceleration in money growth is not what I would consider an isolated event, however. I would expect price increases, which are already well-entrenched in the energy markets, for example, to spread to other areas of the economy in the months immediately ahead. A sudden break in the dollar could also move the inflation time table forward.
I do not see the makings of a "hyper"inflation for the dollar, however. While I admit there may be room for disagreement over the meaning of that term, I feel, nonetheless, that it is way too easily bandied about.
Hey CM - I didn't mean to bum you out! Have another Stout!
You wrote;
"If Trail Guide's forecasting is accurate why, what good will gold do us all?
1. Physical confiscation?
2. Confiscation vis a vis taxation?
3. Gold spent buying the basic food groups and shelter?
Are we going back to the stone age and, what's the point?"
I always felt when reading ANOTHER (FOA), that they anticipate change, not a disaster. The good gold will do you is to allow you to transfer your stored up hours of labor over time without depreciation due to currency fluctuation, the same thing it did for the Russian citizens recently, as well as others. It is the purpose of gold.
If they come for your gold, don't be home. If they want to tax it, avoid them. I'm sure a tiny amount of gold will sustain you and your loved ones for a long time. Make sure you have more than a tiny amount if you still want to drink that expensive wine!
BTW - I sent a copy of this ANOTHER archive to both Ross and Peter. Hopefully they can host it somewhere where all can read! Maybe ThaiGold could host it at his site!
As human beings, most of us show habit of wanting to see people either as good or evil, right or wrong, while discounting the examples which go against our assessment... we paint with too broad a brush. For example, Hitler is now considered evil - George Washington as good. In general that is true, however, it does not mean that Hitler never did a good deed or that Washington didn't commit bad acts.
The same can be said of the ideas of individuals. We tend to either want to follow people blindly or say they're "full of it". We like to have "gurus", **and the less we personally know about someone, the more likely we are to follow them!** It is a human failing we must fight..we must use our gift of critical thought. The truth is that everyone is wrong at sometime - even if they are right the MAJORITY of the time.
The point I'm getting at, of course, is that ANOTHER (and OTHERS!), may be 95% right, or 5% right, but I strongly doubt if they are 100% right! (And I especially doubt it when the topic is as complicated as currencies and the gold market).
To be right all the time would mean one is not human, for it would mean perfect knowledge, which NEVER exists in mortals.
"The dollar and gold will rise together".
Was he right (it hasn't yet happened), or did the dollar perform its blowoff top without the paper price of gold moving higher?
"Risk not your wealth in paper, we enter a period of truth." (1-10-1998)
What, and miss the entire tech/internet bubble - where millions of paper dollars were made that could have been turned into gold holdings?!
"How do you get oil to rise? Today, we stop our CBs from selling gold!" (11-5-1997)
Well, I hate to tell you, but oil went up with continued gold selling from CB's.
Gresham: You have a very good mind.
ET: Thanks for the homework you're doing! I don't believe I have read these passages before. Perhaps Trail Guide will comment upon them.
I'd much prefer Stranger's $500 POG and $60 for NEM. Hello "TheStranger"
We live today in a world turned upside down. I say and believe that anything is possible and, nothing would surprise me.
Not to worry; I'm just tossing out softballs to the crowd on a slow night. I do believe almost every scenario has been carefully thought through. Thanks...CM
I don't know Java Man...I just don't know. That is why I read here. It seemed though that FOA was not talking about just all the dollars in existance, but the whole of everything that anyone anywhere holds valauable. Perhaps this real wealth...even if all dollars burn...would be enough to take us to 6.
As a rule, I do not like dealing in absolutes. Also, I'm a real b#$# buster and inveterate skeptic; especially of your "gurus". However (comma) this Another/FOA stuff is really different. Their timing stinks and that is probably a good thing but they are genuine don't you think? Or, do you think we are chatting with MK and George? :>)
My "off with your head" reply was simply an acknowledgement
of your short apology-post of having used "Thai" instead of
the full handle "ThaiGold". And hence, my (comical) reply to
you was addressed to "Panda", not "Pandagold" to show that
we all can make mistakes. But, punished we must be anyway
so the old monarchish phrase: Off with his head, paraphrased.
It was not a response nor comment upon *anything* else you
had posted. Especially, since so-far I have enjoyed and agree
with most all of your enlightening posts. Please continue.!.
http://www.hillsdale.eduToday I received the latest edition of "Imprimis", a publication of Hillsdale College. An audio clip of Mark Helprin's address is available at the website above.
The closing remarks are applicable to this discussion on gold as well although he was speaking of the way out of our political quagmire of lies propogated recently.
"...Better defeat with the truth in sight than a thousand hollow victories without it."
Hey lamprey - excellent advice! I will watch my step.
Let me tell you what I find interesting since ANOTHER posted this stuff. First, the Washington Agreement turned out to be a pact not to sell anymore gold into the market other than what was previously agreed to. What happened? Gold temporarily took off. Oil has risen. We will see if anymore large quantities of gold are dumped into the market to keep the price of oil down in dollars. By his analysis, when the gold being dumped by CB's was curtailed, oil, the dollar and gold would rise. So far, he seems to be right with the exception of gold. I would like to know exactly what stopped gold at $330 when it started to spike up. Maybe someone will tell us. I suspect it was a massive enlargement of the paper gold market.
At any rate, and I hope you get the chance to read all this old stuff, ANOTHER's contribution to my thinking was in getting me to realize how the world looks at wealth. I now know why his stuff was so difficult to digest the first time around. It essentially stood my world on its head! I used to trade futures and actually did so successfully but after reading of the nature of the game and seeing some confirmation, I decided I was in way over my head. My view of wealth has changed and I'll have to admit, I sleep well. All I worry about anymore is how to shave the last strokes off my handicap.
You are right - beware of gurus, but also, understand wisdom when you hear it. In the few months ANOTHER posted, I learned more about wealth and what it is than all the time previous. I can only send my cyber thanks.
BTW - you have to be kidding about that internet stuff, right? Were you able to actually make all the money on the run up and sell at the top? Did you then change it all to gold? If so, you da man! Thanks for the response.
With all of the digital wealth that has been created the past twenty years, perhaps it is time for a physical inventory? Seriously! I remember FOA said to one time and I paraphrase: "It's time to count what is mine and what is yours".
I find the writings of both ANOTHER and FOA interesting, and I do agree with much of what they have to say about wealth.
Sometimes when I seem as if I'm taking others to task for their shortcomings, I'm often talking to myself, warning myself of MY OWN shortcomings....and yes, I very often feel the need to explain this.
As for the internet bubble -- I did OK...knowing what I know now, I really should have made a killing. It was a short, profitable learning experience...can't complain about that.
I am intrigued by the ANOTHER retrospective taking place on the forum. I jumped on this car only recently, can someone quickly bring me up to speed, on what appears to be widespread acknowledgement of the prescient capabilities of ANOTHER? Is ANOTHER still out there? Has he posted recently? Is what he said in the past relevant today, beyond coincidence?
all this ANOTHER stuff is starting to freak me out! What gives? Are these the quotable remnants of someone long deceased? Broke? Or who has since directed his interest to some other pursuit? CONSIDER THIS A CALL TO "ANOTHER" TO MAKE YOURSELF KNOWN AGAIN! You have impressed the heck out of many posters of whose opinions I respect! COME FORTH! (Please.)
ET and lamprey_65...regarding "the dollar and gold will rise together"
It is happening right under your noses...right now.
Of course, you would not see this if you are looking at things through dollar-colored glasses....meaning that you are measuring value in dollars.
For instance, how can you say that ANOTHER was half right, that only the dollar has risen? I ask you, "Is not a dollar STILL priced at one dollar?" Yes! So how can you say it has risen?
Ohhhhhhhhh..... now I see. You have been measuring the dollar rise in terms of OTHER CURRENCIES. Please apply this same courtesy of measurement to our dear gold.
I am sure that gold's flatness against the dollar, like the George Washington dollar bill's flatness against the dollar, will translate into this "rise" we speak of as seen from around the world.
Amazing how bright and sunny the darkest world may become from the right perspective.
On another note, ET, you suggested: "I sent a copy of this ANOTHER archive to both Ross and Peter. Hopefully they can host it somewhere where all can read! Maybe ThaiGold could host it at his site!"
Are you perhaps overlooking the obvious, or was that your kind recognition that many activities here in The Tower surely already have me overburdened like a rented mule? Providing html format for these various early posts -- as were the basis for "The Footsteps of Giants" -- has, in fact, been long on my agenda. Seeing this renewed interest in these posts at this time has prompted/inspired me to move it WAY up to number THREE on my priority list. It shall be done by the first part of the week. On this you have my word.
ET, thank you for bringing forward again these remarkable, discussion-worthy posts.
Randy, I've never liked this "gold price rising in other currencies" argument. It just doesn't stand up to common sense as it merely shows the strength of the dollar vs. other currencies. Let's face it - gold just didn't start running higher on it's own accord in foreign currencies - no, the dollar ran strongly from Oct '99 until late last year...that's why other currencies fell and gold is priced higher in foreign lands. It's not a great mystery.
The dollar is, whether we like it or not (and if you're American, you should like it - while it lasts), THE reserve currency...it makes all the difference. And since I'm American, the price of gold in Polish Zloties matters not a whit to me.
Yes, lamprey, but please appreciate this:
If ANOTHER were himself Polish (as in your example), we would EXPECT HIM to say "the dollar and gold will rise together".
However, I think it has caused much confusion over the years on this and other forums. This is why semi-mysterious internet posters prophesizing the future doesn't give me a warm fuzzy.
If you're American, you should be purchasing some bullion to secure yourself against the fiat dollar. What happens in other lands should act as example of what could happen here, but that's it. Once again, it's wealth preservation - I know, preaching to the choir.
Hey SLaTT - am I pronouncing that right? ANOTHER posted at Kitco (another forum), back in 97-98 creating quite a stir at the time. It turned out that our friend, FOA (Friend of ANOTHER) of Trail Guide fame, was posting his "Thoughts!". It was sparkling commentary at the time as it is today and met with much ridicule as well as much amazement. He had a completely different perspective. His posts, as Randy has noted, are available in "Footsteps".
Randy - of course you are right. It is all a matter of perspective, as ANOTHER said! If you like I can transfer the archives to you already in HTML format as that is how I swiped them in the first place. Unfortunately, my archive only goes back as far as 2-15-1998.
http://abcnews.go.com/sections/2020/2020/2020Friday_010119_stosselgoestowash.htmlGood show on government tonight. "John Stossel goes to Washington." As I have said in past posts - government is one of the best scams ever devised by man. There is no real difference between say the US government and the Mafia. Foe example, don't pay your "protection money" to the government, they steal it at the point of a gun, and don't pay your "protection money" to the Mafia, then get it stolen at the point of a gun. OK, so maybe the Mafia breaks your legs too. Anyway, excellent expose on everything from government incompetence, lazy bureaucrats, and imminent domain law (government theft). Rep. Ron Paul is featured in a segment as well. Interseting.
Attn: Attn: slingshot (1/27/2001; 11:12:46MT - usagold.com msg#: 46631)slingshot writes:
[snip]
{re:}E.T. msg 46627
After reading the post I get the feeling that the CB's are not in control of
this gold manipulation but the oil producers. They may have been one time, no
more.
Considering how the oil producing nations in the east would love to see the oil
gussling west in dire straits as they suck the life out of the CB's (gold). Run
the price of gold by increase in oil value. Which calls the gold shorts and
dumps the markets.
The only thing missing as per ThaiGold is the drugs and the CB's are force to
launder the money by Blackmail I presume.
I think I just had a brain spasm.
[unsnip]
[ThaiGold response:]
Indeed. A nice healthy brain spasm. The Oil Producers (currently) obscene profit
("GOOP") are calling the shots. Doing it themselves, flooding (their) gold hoard
into the markets to drive down the POG (temporarily) and with precise timing, it
is quickly bought back (at lowest POG prices) and is a very profitable bonus to
their manipulations. At the same time they buy whatever *additional* gold they
wish, to convert/exchange their (daily/weekly/etc) fiats (EUROs included) into
their prefered/cherished gold. It takes not a Rocket Scientist to enVision it.
Their newer scheme is a refinement/replacement of the oil-for-gold scenario that
existed at the time of "ANOTHER"s circa 97-98 writings. That one was too complex
fragile, cumbersome, and for many other reasons, fell apart at the seams.
Many in this forum fail to grasp that. It's old thinking. The new reality must
now be refered to as Oil-to-Dollars-to-Gold and Drugs-to-Dollars-to-Gold, all of
which is sorta "inclusive" in my new-thinking theory. It answers alot of evasive
questions and addresses issues that (to me) were left hanging or conveniently
left unresolved or unaddressed by the prodigous "Another/FOA/TrailGuide" essays.
Today I have read all your posts in response and comment to me. Much appreciated
as always. Thank you. Many feel that I am picking on FOA/ANOTHER or yourselves,
in using terminology like "Lemmings", "Giants", or whatever, has maybe offended
you or made some of you feel uneasy. I plead guilty to trying to make people in
this forum open their minds and rethink alot that has previously been accepted
as gospel. I know that many of you here worship everything they write, and can't
wait for each upcoming installment, to praise and fall all over yourselves to
wal...er.. wonder of it. And I also know that it is herein considered vastly
inappropriate, impolite, and unfathomable to dispute, criticize, or condemn any
of their writings. Indeed, in the past some errant posters herein have instantly
lost their posting priviledges for having done so. And I may too just for having
written this. So you can see, what I'm up against when I write to post an essay
that contains contrarian theories or fresh thinking. Trying to spur others to do
a little of their own. It isn't easy. I try to explain things as I see them. And
I try to stay within bounds of respect and politeness. And within the Forum's
Guidelines. Those are important to me. Yet, so is (correct/new) knowledge.
Indeed, Randy and I have such respect for rules that we mutually agree that it's
a violation of Guideline #4 to even so much as post my new website's url here
anymore. It's a no-no. Even though I *created* the website's latest features to
be a resource especially for members of this Forum. I have not posted, nor have
I asked anyone else to post, my website's url into any of the other forums. It
was also to be a spot where I could put interesting and informative charts, data
and other significant items that could be included in my USAgold posts, directly
as links. For example, long-term gold; oil; and silver charts to illustrate some
points I wanted to make in some essays. Well, I cannot do that. Is that my loss,
or everyone's.?. Lamprey_65 suggested I archive all of "ANOTHER"s writings at my
website. I'd be happy to do so, but I cannot post my url for you to find them.
Besides, I believe that the "ANOTHER" archive already exists, right here in the
USAgold forum's extra-feature links shown at the top of the Forum page.
Some of you posted or "agreed" that I seemed to feel ignored or antagonistic for
that. Maybe that's human nature. But I feel strongly that many posters here
avoid any commentary whatsoever directly to/or/about me, simply because they
are afraid to appear supportive of someone perceived to be anti-FOA, etc. Or
they hope I'll just go away if given the silent treatment. Afterall, wouldn't
you, if virtually all of your hard work and writing was constantly suppressed
of any comments simply acknowledging it.?. For fear of being tarred with the
same brush by the mainstream peers. Or fearing conformity-or-else-exile.
We need to encourage more posters with different outlooks. Believe me, there
are many of them lurking out there. But are afraid to post their true thoughts.
The emails I receive are far more (secretly) favorable to my views as opposed
to "others", by a wide margin. Yet, here in the forum, you won't be aware of it.
Do you come here to learn.?. To share insights.?. Or to have a LoveFest.?.
Mr Gresham (01/27/01; 18:37:11MT - usagold.com msg#: 46663)
�
Also -- the prospect of Euro on the horizon was not enough to shake the dollar world. Needed to see it in action for a couple years before believers would be made.
Dollar has had more legs than Another/FOA imagined then. Timing was off. So, is dollar stronger now for having survived longer? No; it just has fewer left of an unknown number of rabbits to pull out of its hat. Timing is the hardest part of contrarian prediction. Trend followers got it easy -- until.
Trail Guide (1/18/2001; 9:32:39MT - usagold.com msg#: 45846)
�
Who among us, ten or twenty years ago, would have ever thought the fed would still be exploding our dollar production today? Back then, such an "inflation of the currency", over this long a time span, was unthinkable. It would surely lead to an immediate destruction of the dollar. But, here we are, watching as dollar production is gunned for the ????? time.
Everyone with any knowledge at all, the Ruffs, the Browns, the Schultzs, etc.,,,, all knew any such currency inflation, as we see today, would send the world off the dollar standard! Where would we all go for money relief? Why, gold and silver, of course! But, what happened? Well, the world conomic structure changed and those extra years sold time to others for the creation of Another currency.
You see,,,,,,, this was the trick (or ploy) of "one world trade". This concept alone produced the extra demand that needed "trading dollars". This short term transition, aided with cheap oil deals, demanded "digital money" for trade, not savings. It was this new "one worldeconomic expansion demand" that put our dollar so much more "in play" for it's settlement function. It's value as a savings utility was not in demand, but it's need to denominate and close settlement was. This exceptional surge in trading demand overcame it's loss of demand as a "holder of value".
Gold Eagle has MoutanGold
Kitco has APH
USA Gold has FOA
Anyone see a pattern?
Like I said, it's human nature Not that I disagree with what they say...as a matter of fact, I actually agree with all three of the above more than I disagree with them (although APH's motives trouble me somewhat).
BY STEVE JOHNSON Mercury News If PG&E is forced to cut off natural gas to its customers -- which it says could happen within weeks -- thousands of homes, hospitals and others could lose heat and hot water and use of their stoves for months, the utility has warned state regulators. Once gas is cut off, PG&E workers would have to visit each home and business to restart the pilot lights. ``If vast numbers of customers lose service, it could take weeks, if not months, before all service is restored,'' according to documents filed with the California Public Utilities Commission.
PG&E has been warning of gas cutoffs for weeks, because its suppliers are increasingly nervous about dealing with the financially imperiled utility. It's unclear whether the state would allow that to happen, but a gas cutoff to thousands of customers would have many more serious consequences than the rolling blackouts of recent days.
Unlike the situation in an electrical blackout, getting natural-gas customers back on line is far more complicated than simply flipping a switch. The reason PG&E workers would have to restart the pilot lights is that it's too dangerous to have customers do that themselves, utility officials point out. ``PG&E's gas service personnel, working in conjunction with personnel lent by other regions and states, could restore service to only approximately 10,000 to 20,000 of PG&E's 3.9 million customers per day,'' according to the papers.
While some big electricity customers have backup generators, few businesses, homes or even emergency agencies have backup supplies of natural gas. That could have ``catastrophic effects,'' the documents explained, because ``hospitals, government agencies and industrial users . . . would have to cease operations.''
Maintaining pipeline pressure so that gas would continue to flow elsewhere could make life even more miserable. To prevent what the documents term ``a total system collapse,'' PG&E might have to shut off gas ``to entire cities or counties'' in areas that are farther from gas pipelines.
Cutting off gas in some areas to preserve the integrity of the overall system is akin to applying a tourniquet to a severed artery, said Kirk Johnson, director of gas systems operations for Pacific Gas & Electric Co. Valves would be turned off on major gas lines, affecting up to 100,000 customers at a time. He said areas farthest away from the main pipelines -- including San Francisco, Santa Cruz, Sacramento and Fresno -- would be shut off first and put back on line last.
Because a gas pipeline runs through Milpitas, anyone living in Santa Clara County would probably have gas shut off only after the more remote population centers were hit. But given the company's dwindling gas reserves and the prospect that suppliers might stop selling to the firm in the near future, PG&E officials say it's possible that Santa Clara County customers and many more could be affected. ``For residential customers who lose gas service, home furnaces, stoves and water heaters would shut down,'' according to the documents. ``Customers, particularly the young and elderly, would face potential health impacts from the lack of heat, hot water, cooking facilities and other services for a significant period of time.''
Many PG&E customers have lost gas service before, for example after the 1989 Loma Prieta earthquake. But Johnson said he didn't know of any utility that had ever cut off hundreds of thousands of customers at one time. To provide temporary help to PG&E, the Bush administration Tuesday ordered out-of-state gas suppliers to continue selling to the utility until 3 a.m. Feb. 7. But after that, federal officials have said, the order won't be extended.
In further hopes of appeasing its suppliers, PG&E has asked the Public Utilities Commission to give those companies priority so PG&E can pay them ahead of other companies, including those that sell electricity. Moreover, PG&E is seeking the commission's approval to have another utility, Southern California Gas Co., buy gas for it on an emergency basis. But it's unclear how much help that priority billing arrangement would provide. And SoCalGas officials have opposed the idea of being PG&E's financier, fearing they won't be repaid. ``Placing SoCalGas in the position of banker when the risk of total loss is almost a foregone conclusion is simply unconscionable,'' SoCalGas officials have said in an official response to the commission. While SoCalGas has questioned the severity of PG&E's natural gas problem, Marcel Hawiger, an attorney specializing in natural gas issues for the Utility Reform Network (TURN) in San Francisco, believes PG&E and its gas customers are in real peril. ``That can lead to a very dangerous situation,'' he said. ``We're taking this very seriously.''
Black Blade: The Grasshoppers have been encouraged to watch today's Super Bowl with friends as the extra load from appliances and TV's could force more rolling blackouts. Meanwhile, The People's Socialist Republik of Kalifornia is again on a Stage 3 alert through this weekend. A power failure during the game could be rough as millions of angry Grasshoppers surge through the streets deprived of this yearly holy ritual. Hey - Ya just never know! "And the Grasshoppers danced, sang, and played all summer..."
Sorry... I mis-remembered who posted what today.
It was ET, not lamprey_65, who suggested that I archive the
"ANOTHER" writings. Still not a bad idea. If I could.
http://biz.yahoo.com/rb/010127/g.html By Nigel Hunt
LOS ANGELES (Reuters) - Wind power producers in California were blown away when after years of struggling to turn a tiny profit the price of their energy quadrupled late last year and they were making windfall profits. But, in the midst of California's severe energy crisis, a time you would think they would be most needed, their elation has quickly died down. Their near-bankrupt customers took the wind out of their sails by refusing to pay them.
Utility Southern California Edison earlier this month suspended payments to ``qualifying facilities'' which include wind power producers. They have yet to pay even for energy produced last November. And another utility, Pacific Gas & Electric, has also halted payments. The two companies want to renegotiate contracts at a much lower price, industry sources said. ``We had a couple of profitable months after 10 years of being very marginal,'' said Bob Gates, senior vice president for Enron Wind Corp., a unit of Houston-based energy giant Enron Corp (NYSE:ENE). Jan Paulin, president of SeaWest Power, which develops wind power projects, said after years of struggling to survive with prices of around three to four cents a kilowatt hour the industry suddenly became extremely profitable as the state's chronic electricity shortage helped prices soar to about 17 cents.
The state's power shortage has its roots both in insufficient supply and in a credit crisis caused by the financial woes of its two leading utilities. To meet demand, California utilities have been forced to pay skyrocketing prices for wholesale electricity on the spot market. But they are not permitted to pass through their full costs to consumers under the state's 1996 deregulation law. The burden has taken San Francisco-based Pacific Gas & Electric, a unit of PG&E Corp. (NYSE:PCG), and Edison International (NYSE:EIX) unit Southern California Edison, which is based just outside Los Angeles, to the brink of bankruptcy. Prices paid for wind power are based on an ``avoided cost'' formula set on the basis of the cost of producing electricity by the most likely alternative method -- which in California means natural gas. As a consequence, as natural gas prices soared late last year, so did prices for wind power. This produced windfall profits until the utilities stopped paying for the power generated by the extensive ``farms'' of somewhat alien-looking propellor-driven wind turbines.
WILLING TO CUT PRICE IN HALF
Enron's Gates said wind power producers are willing to renegotiate their contracts with the utilities, many of which run for 30 years. They are discussing a revision which would significantly reduce the price and fix it for five years. ``I think we are going to cut the price in half and fix it for five years,'' Gates said, noting that wind producers may receive about eight cents a kilowatt hour, down from around 17 to 19 cents at the moment. California currently receives less than one percent of its electricity from wind power with development curtailed by competition from seemingly cheaper natural gas-fired plants.
Wind has, however, one major advantage over its main rival. The cost of its input never changes in contrast to natural gas-fired plants which have seen their running costs soar during the last few months. This means it is ideally suited to providing supplies at long-term fixed rates, something California has been seeking to secure recently. Wind producers were, however, not able to bid during California's auction this week for long-term supplies as the state was seeking ``firm'' supplies, bringing attention to wind's great weakness -- sometimes it does not blow. In the mid-1990s California abandoned plans to invest in wind plants under pressure from utilities such as Southern California Edison which argued that cheaper alternatives were available and the state did not need the power. This has diminished the sympathy some in the industry may feel toward the financial plight of the embattled utilities. ``I think in the wind community there is some residual irritation because Edison has not been all that cooperative with wind,'' said Gates of Enron. Gates said that if wind producers continue not to be paid they will stop supplying electricity. ``You come to a point where you will have to stop because you can't pay people (your employees). If they won't pay, we will have to walk out of the contract ...,'' he said.
Black Blade: Does it matter? The Grasshoppers don't want these "wind blenders" in their backyard. They talk the talk, but don't walk the walk. Even with Commissar Gray Davis's bail out and Internet energy auction plans, it looks as if the 2 major Utes are probably going to go tits up.
(UPDATE: Updates with White House comment)
By Michael Peltier
TALLAHASSEE, Fla., Jan 26 (Reuters) - The U.S. government should not open up the eastern Gulf of Mexico to offshore oil drilling, Florida Gov. Jeb Bush said in a letter to an administration now headed by his elder brother, President George W. Bush.
Throughout his White House campaign, the former Texas governor said he wanted to boost domestic production of oil to make the United States less reliant on foreign sources. Such talk raised concern among Florida's environmentalists and state leaders who have historically opposed offshore oil exploration in the eastern Gulf of Mexico.
In a letter on Tuesday to acting Secretary of the Interior Tom Slonaker, Jeb Bush voiced his opposition to the sale of an oil and gas lease covering nearly 6 million acres (2.43 million hectares) of federal waters just southwest of the Alabama-Florida state line. The last federal lease sold in the gulf was in 1988. ``There is strong support among the state's citizens and within the Florida congressional delegation for no new leasing in the eastern gulf -- a position that has been upheld through the years by administrative deferrals, congressional action and presidential moratoria,'' Jeb Bush wrote in a letter obtained by Reuters on Friday. ``I am confident that the new administration will recognize the need to protect sensitive natural resources located both offshore and along Florida's coastline for the benefit of the entire nation,'' Jeb Bush wrote.
It appeared the position was in line with that of his brother, President Bush. Asked in Washington about Jeb Bush's request, White House spokesman Ari Fleischer said, ``That's consistent with the president's position during the campaign, about any drilling off of the shores of Florida.''
Florida banned offshore drilling in state waters in 1990.
Environmentalists praised Gov. Bush's letter, saying it sent a strong message that Florida officials will continue to oppose drilling off the state's Gulf coast. ``The most significant thing about the letter is that it is a change in state policy on offshore drilling that goes even farther than (previous) administrations,'' said Mark Ferrulo, who tracks offshore oil drilling issues for the Florida Public Interest Research Group. ``It takes a position on waters that are not Florida's own.'' Ferrulo said the letter also represents the second time a Bush has stepped in to oppose offshore oil drilling in the eastern Gulf. In 1990, President George Bush banned offshore drilling in federal waters off the Florida Keys. Florida is currently battling a proposal by Chevron (NYSE:CHV), which wants to drill in federal waters about 25 miles (40 km) off the coast of Pensacola. The company's request is now before the U.S. Department of Commerce.
Black Blade: Strong support? Maybe they should have a recount. OOPS! ;-)
http://biz.yahoo.com/rb/010127/d.html By David Crossland
DAVOS, Switzerland (Reuters) - Top finance officials on Saturday forecast slower world economic growth this year and expressed concern about the outlook for Japan, which has less immediate scope than the United States to spur output. Stanley Fischer, first deputy managing director of the International Monetary Fund, said the IMF could cut its forecast for global growth in 2001 to around 3.5 percent from the 4.2 percent expansion it had foreseen last September. However, he told the annual meeting of the World Economic Forum business summit that the world economy was still far from shrinking, predicting a pickup in U.S. growth in the second half with full-year growth likely to be around 2.5 percent. ``We are still a long way from a global recession,'' he said, adding that growth was still above rates seen in the early 1980s.
This year's annual meeting of the World Economic Forum has been overshadowed by fear of a global recession as U.S. growth has screeched to a halt. Japanese output may have declined slightly in the fourth quarter of 2000, Fischer said, adding that by contrast the U.S. was in the fortunate position of having the option to continue lowering interest rates to spur its growth. ``U.S. real interest rates are not unusually low at present by historical standards, so I don't fear what you fear,'' he told a questioner who asked about the inflationary impact of more interest rate cuts.
``Remember they have got another 400, 500 basis points to go if absolutely necessary -- not that I think that will be necessary. I don't see that as a major danger. This has been a reasonably balanced expansion by historical standards,'' he said.
Fischer welcomed the Federal Reserve's 50 basis point interest rate cut early this January amid signs of a slowdown. Former U.S. Treasury Secretary Lawrence Summers said Japan was unlikely to achieve the higher levels of sustainable growth it was capable of unless it adjusted its mix of monetary and fiscal policy. Even restructuring of Japan's corporate sector, although helpful, would not be enough on its own, Summer told the Forum. ``Without a change in monetary and financial conditions that produce the impetus and the fuel for nominal GNP growth, it is not likely that the generation of positive supply shocks through microeconomic efficiencies will have a material impact on the underlying path of demand growth'' in Japan, he said. ``But I think it is fair to say there has been a certain amount of reluctance, at least at some points in Japan, in recognizing that reality.''
Japanese Vice Finance Minister for International Affairs Haruhiko Kuroda said he was confident the yen will not decline sharply and that Japanese government bonds would not crash. Kuroda said the government's forecasts last December of gross domestic product growth of 1.2 percent for the fiscal year to end-March, and 1.7 percent for the following fiscal year, were ``on the conservative side.'' ``I am confident that there will not be a crisis such as a crash of JGBs (Japanese government bonds) or a sharp decline of the yen,'' Kuroda said. He said the corporate sector was doing ``fairly well'' with corporate profits set to rise 15 percent in the fiscal year to end-March 2001 and business fixed investment also buoyant. But household spending remained flat , Kuroda said. Kuroda also said that fiscal consolidation would be one of the main priorities of the Japanese government and agreed with Summer's assessment of the Japanese economy. ``The Japanese economy is improving but rather slowly, modestly, with some quarterly fluctuations,'' he said.
German Finance Minster Hans Eichel said Europe would be able to support global economic growth by growing around three percent in 2001. Eichel said the world economy now faced greater risks than a year ago but that if oil prices stabilized at levels seen in recent weeks it would be a ``big plus'' for the world economy. ``I'm sure OPEC is aware of its responsibilities,'' Eichel said. ``Europe with economic growth of about three percent in 2001 will have a favorable effect on the world economy.''
Black Blade: What's that? The US could cut rate 400 to 500 bps? Zero percent interest doesn't help the Japanese much, and they're in � what? A 10 year recession? Telling some very Tall Tales in Davos these days.
http://www.usagold.com First of all,thank to you Stranger for your response to my post on inflation.
Here are my thoughts on the Gold Market for what they are worth.I have reached these conclusions just from my observation of life.
The probleem with Gold right now is limited demand. Yes, it does appear there is an attempt by banking elements to surpress the price of Gold, but they succeed only because of the limited demand.
I talk to investors and I dont find many who think of Gold as a good investment. I have a friend who is pretty typical
and he is convinced the Federal Reserve interest rates are going to save the stock market, and I think there are many investors who agree with him. BTW, he also invests in real estate. My mother on the other hand is older and fearful of both the stock market and real estate. She doesnt really know what to do and just puts her money in T-bills or CD's; there are also many like her.
So if you think of the investment dollar as a circle everything competes for a piece of the pie. Gold, right now, gets only a sliver of the pie from contrarians.
However, if you remember the late 1970's it was not like that. We were experiencing double digit inflation, and investors were fleeing to gold to preserve their wealth.
I do not think we will see POG rise until we have an absolutely crashing Stock Market. And even that will not do it entirely. We will also have to have a significant amount of inflation,how much that will have to be I dont know.
Gold at this point in history seems to be the investment of last resort. Other investment vehicles have to be discredited, and there has to be a gradual or sudden increasing of the POG.When this happens (and only then) then gold will be an attractive competing investment.
Can this happen? Certainly, it has happened before.The stock market appears to be verging on a debacle.There are certainly forces at work which should stimulate inflation but possibly the Stranger is right and it wont be hyperinflation.
When I look at these factors and the current historically low price of Gold,I come to this conclusion:
Gold and Siver have very little downside potential.And they ey have a significant upside potential. Therefore, a prudent man would own some physical gold and silver.
It has also been proven to me that specualtive Capital can be invested in the Futures market. I personally like options because of the limited downside potential coupled again with significant upside potential.
And I believe that Bill Murphy has it right when he describes investment in some Gold Stocks as the same as buying non-expiring options. Again, I think speculative capital only should be used in things like Junior Gold mining stocks.
These are fairly common sense observations. Competing investmets for the investment dollar have to lose their luster and gold will have to begin to shine a little.If this does happen, then it could be like an avalanche rolling down a hill.
Potential wild cards in this mix are good probabilities of war in the Mideast and war with China over Taiwan.
So be wise,buy some gold and silver as a protection for your family and also an investment of little risk and great upside potential.Good advice I think
Im finished and probably wrote too much.Personally,I skip over long posts some time. The clearer'simple and shorter the post the more I like it.
Who killed Wolwaka by the way?And where did you bury the body?
You feel that gold will be a haven if/when the StockMarkets
crash. Beware. In 1987, there was a severe "correction". And
myself fled to precious metals. But they got slammed hard by
the intervening FED and cohorts. To prevent such a flow of
investors into PM's. So I got burnt badly. Years later I was to
read a quote of the Fed Chairman at that time: We (the FED
and US Gov't) intervened in those markets. We chose to hit
the very thinly traded Platinum market first, to get maximum
effect". [I may have paraphrased this a tad]
Recently, the same pattern has shown to be their rule #1 as
the StockMarkets have "correction" after "correction". But now
they slam Gold directly. It's easier to do, because now Gold
is being slammed relentlessly day-by-day by the GOOP plan,
and those guys are ever so happy to aid the FED/Gov't when
they need such massive "intervention". As I wrote earlier, this
is a synbiotic relationship. They each scratch the other's back
and manage to See No Evil, Hear No Evil, Do No Evil.
Gimmee a Break.
Other than that, I enjoyed your sharing of thoughts with us.
Rare presidential souvenirs similar to the ones taken from Air Force One when Bill, Hillary and Chelsea Clinton used the aircraft for their final trip home to New York have popped up on the Internet auction site eBay.com, United Press International reported Saturday.
Giving the first family the benefit of the doubt, UPI suggested the missing items had been taken by "Clinton staffers" and noted that "there is no indication that some of the [auction] items ... were among items taken from the plane."
But dealers in collectibles told the wire service that it was unusual for such a large number of presidential souvenirs to become available so soon after the transfer of power.
"These are very hard-to-get items. They are not mass-marketed and are only made for the White House, so we don't see a lot of them," one trader said.
The items up for sale included a White House guest bathrobe, current bid $305; a leather air travel bag, with Air Force One logo ($360) and an Air Force One humidor - item # 544207091, emblazoned with the president's seal - for more than $2,000, 48 cigars included.
The presidential souvenirs were put on sale between Jan. 17 and Jan. 21.
It's unclear just who took the missing Air Force One collectibles, but Mrs. Clinton was accused this past week of soliciting expensive gifts prior to her White House departure to help furnish her New York and Washington homes.
Add to that her reputation for thriftiness, which apparently knows no bounds. The Clintons' IRS returns showed she took tax deductions during the 1980s for donating her husband's used underwear to charity.
A week after the Rev. Jesse Jackson acknowledged fathering a daughter out of wedlock, rumors are swirling that the 20-month-old girl may not be the only Jackson child his wife didn't know about. On Thursday the New York Post's Rod Dreher reported on a prayer meeting held to support Jackson two nights earlier at New York's Canaan Baptist Church. A source who was present told Dreher that the audience "'looked at each other and shook their heads' when Jackson showed up without his wife, who was expected, but with a controversial woman in his entourage. ..." Monicagate insider Lucianne Goldberg also claims to have had a source at the pro-Jackson prayer-fest. Thursday's edition of Lucianne.com's "Short Cuts" news summary confirmed Dreher's report and elaborated on the controversy to which he alluded. "Our man reports that eyebrows among New York's black elite jumped through the roof when a woman showed up who was known to them all as the mother of yet another Jesse love child - the woman joined Jackson onstage at the rally's conclusion. "'I couldn't believe it,' our spy said. 'You should have seen the faces of those uptown ladies and ministers' wives. They knew the deal.'" After the rally, Lucianne.com's source discussed the situation with several of the appalled spectators. One compared Jackson to Bryant Gumbel, whose wife just alleged in divorce papers that he's cheated with up to 50 women. "Shoot, Jesse has had that many in six months," the Ldotter spy countered.
Black Blade: What next? Barnyard animals? This just gets more bizarre all the time. Also, notice that the Reverend has not appeared on his CNN TV show lately. Looks as if he suffered more than one momentary indiscretion. OK, but it's a slow night on a weekend.
Morris: Scandal Insider Quinn Forced Clinton to Pardon Fugitive
House and Senate investigators currently pondering probes into ex-President Clinton's pardon of billionaire tax evader Marc Rich may find the outrageous decision had more to do with Rich's lawyer, one-time White House counsel Jack Quinn, than political donations from Rich's ex-wife Denise. "It has very little to do with Denise Rich's money," former White House political guru Dick Morris told Fox News Channel's Paula Zahn Thursday night. "It has to do with one thing and one thing only, what Jack Quinn knows." Quinn headed up the White House's legal fire brigade for 18 months, Morris explained. And he was in a position to know where all the Clinton scandal bodies are buried. "Jack Quinn knows everything," Morris told Zahn. "And when Bill Clinton talks to you, he keeps an encyclopedic file in his mind of what you know. He knows what you know. ... And when you know a lot and you come to Bill Clinton and you ask for a favor, you get it." "And believe me, I know what I'm talking about!" added Morris, sounding as if he may still harbor a Clinton secret or two himself. The one-time White House adviser noted that Quinn would have had to review all the evidence eventually turned over to congressional probers. "He knows all of the documents on travel office, all of the documents on Foster, all of the documents on Whitewater, all of the documents on every one of the Clinton scandals that predates 1996," said Morris. Quinn also knows what they decided not to release, which could amount to a cache of evidence compelling enough to outfit Bill and Hillary Clinton in orange jumpsuits for years to come. So, posited Morris, "When Jack Quinn comes to Bill Clinton and makes a request, Bill Clinton says, 'How high?'" Morris outlined a few of the scandal secrets that likely forced Clinton to pardon Quinn's client. "They have Riady pay off Hubbell 100,000 bucks to shut up, pay off Jim Guy Tucker and his wife 500,000 bucks to shut up. "And then Hillary shreds all the documents she can get her hands on. And then they're saying there is no evidence to convict them. "You have to be a certified moron to believe that Jim Guy Tucker and Jim and Susan McDougal borrowed $300,000 from a government fund for a program that they never spent the money on, know that they spent it on Whitewater, all of which is an established fact, and believe that Bill and Hillary didn't know it. "You have to be an absolute moron to believe that, yet there is no documentary evidence that they knew about it because the people that know it were either pardoned or bribed, Hubbell and Tucker bribed, McDougal pardoned." Is the old Clinton hand talking through his hat? Lest anyone doubt him, Morris issued this challenge: "If Tucker wants to sue me over the use of the word 'bribe,' or Hubbell does, too, go ahead. We'll have a fun time in discovery."
Black Blade: Another take on Marc Rich and then some. We already know that the Clinton-Gore administration was among the most corrupt in US history, but no one knows how deep this goes � or is there some one who knows where the corpses are buried? Of course, then again Dick Morris is the guy who had a foot fetish with prostitutes.
Scandal-scarred Sen. Hillary Clinton was reported to be hiding out in her Chappaqua, N.Y., mansion on Friday, canceling all public appearances, including one with new daddy Jesse Jackson - as outrage grew over charges she conspired to sell presidential pardons for campaign cash. The New York Post reports that Clinton has canceled all public appearances for the day, including her address to Jackson's Rainbow/PUSH Coalition's Wall Street Project, announced only yesterday. Clinton also will pass up previously scheduled meetings with two top New York City Democrats, Public Advocate Mark Green and Comptroller Alan Hevesi. New York Mayor Rudy Giuliani saved the new senator the trouble of canceling his meeting with her. He did that himself late Thursday, saying he was outraged over the Clinton pardon of Marc Rich, the tax-dodging fugitive whom Giuliani had indicted in 1983 when the mayor was U.S. attorney for New York's Southern District. Rich's ex-wife Denise has donated over $1 million to the Clintons and other Democrats since 1993. "I'm very upset about this," Giuliani told reporters yesterday. "I think what the president did is an absolute outrage." Mrs. Clinton may be able to dodge Pardongate questions for now, but both Clintons could wind up trying to explain the cash-for-clemency scandal to Congress before too long. Yesterday House Government Reform and Oversight Committee chief Dan Burton launched a preliminary investigation, saying, "When a pardon appears questionable on the merits, the American people have a right to know why the president made his decision, so that the constitutional power to grant pardons will not be abused in the future."
Black Blade: OK, the last one. The point being that government is a great scam if you can get it. It obviously pays well. Does the idea of gold price manipulation sound so far-fetched now? Hmmmmm....
"If you analyse the durable goods orders closely, you can see that from the peak of non-defence capex orders in August to December, we have declined some 8.5%. During the 1990 recession, the entire decline for the whole of the recession was 9%. In other words, over the last 4 months of 2000, orders have fallen by almost as much as they did during the whole of the [1990] recession. This is not a hard landing; it's a plunge from a cliff-face."
Also some interesting observations on Mania tops and bottoms ie: how does Dow=800 sound?
Attn: Black Blade (1/28/2001; 2:25:34MT - usagold.com msg#: 46706)Hi Black Blade
That news item you posted about Clinton/Quin/Morris is very
earth shattering. On PBS recently, they played a long tribute
to Clinton's reign, put together by Frontline and in cazoots
with ABC's Nightline. It painted a rosy picture of course of the
entire 8 years. As I recall they made quite a big deal of Dick
Morris being Clinton's right hand man, speech writer, and
confidant advisor, and Friend of Last Resort when everyone
else was deserting him (Clinton) in embarrasment and disgust.
Indeed, (PBS/ABC) said, it was Dick Morris who singlehandedly
was responsible for salvaging Clinton's image and getting him
reelected in 1996. So, it's amazing that Dick Morris has now
turned upon his Best Friend. Simply amazing.!. That whole
8 year period will go down in history as a cheap dime novel.
Legacy indeed.!.
I did not know much about gold, oil, and currency markets when I came here. Only a few people who post here or on other sites are able to share much professional or life experience that they've had with those markets.
When I read someone's stuff that is so new to me, I first have to ask if it is just razzle-dazzle attracting me, and, yes, I am vulnerable to several styles of presentation. And, yes, over time, I could get stuck on one person's presentation alone , but only IF I never checked out independent corroboration of what he's saying.
What other way are we ever exposed to new things in an urgent timeframe?
But also, over time, I can develop my own perspective on what is being taught. (Guru means "teacher".) And if I'm learning what I want to learn, I'll stay with it. Especially if I'm discovering other wise commentators and actual events confirming what was taught.
Since it's me that has to decide my investments for myself, it's also me that has to decide when I've learned enough from someone to move on. That might be at the point where I've learned enough to actually see a limit in the other one's viewpoint. To the point where I can offer something original back. Not there yet.
That level of development is something that could also happen in collegial discussions in a forum like this. But that criterion isn't reached merely by saying "That guy sounds like a Guru. Stay away!" (Note the use of "Guru" as a pejorative, dismissive term.)
(I've also seen a few cases of "Guru Envy", too. The temptation to some, perhaps with good ideas to share, when they find a ready-made audience. Simple RESPECT lost in the ego rush of being seriously listened to by others with open minds. A little time and perspective could help this, too.)
Note: Predictions are a whole other issue associated with "Gurus". Perhaps the listener should develop the habit of keeping these separate in mind from the background viewpoint that is being imparted. Then you can work toward your own predictions -- the ones you make your investment decisions upon.
Hey, if you've got any assets anywhere, then you've already made predictions, or someone's already made them for you. We're just working to improve on our predictive abilities now.
If I decided to become a poker professional, I'd try to find a pro to learn from first. It doesn't guarantee I'll get dealt perfect poker hands but at least I can read some tells and maybe even locate the patsy, hoping that it ain't me anymore!
You know, the standard investment "wisdom" over decades has been "diversification", maybe based on a Random Walk theory of market knowledge, (or lack of knowledge.) FOA definitely disavows that wisdom at this time, at least as he describes his own commitments. Maybe that's what sets him up to take a few "slings and arrows"?
But, at least in casino gambling, the only game with a consistent win margin (~1.5% -- hardly worth it) is Blackjack, and that's with card counting, and variable betting. When the deck is rich with high cards you make your big bets. No guarantee any one hand will win, but the odds are with you as at no other time. I just see this as someone helping us to get the count, and trying to convince us that it's a rich one this time.
Like I said, I was pretty new at all this. Maybe I'll let you know when I know enough to criticize someone who seems to be trying only to help me.
Mark Twain wrote: "The principal difference between a dog and a man is that, if you take a dog and make him prosperous, he will not try to bite you." Arf.
There are calls over the last couple of days to have congressional hearings on the Clinton pardons. This could really give Bubba a legacy alright. It could shoot down Hillary's re-election hopes for the senate and squash any Presidential aspirations as well, if as I suspect, the skeletons begin to tumble outta White House closets en masse.
BTW, I have been looking over the BLS phoney baloney statistical models using "Hedonic Deflators/Pricing" and what a truly strange mess. The whole of the "New Economy" valuation scheme looks to come apart at the seems if some such as Dr. Kurt Richebacher of Richebacher Letter fame are correct. I still have to punch through some more info, but the whole "New Economy" valuation scenario looks to have been an anomoly built on dubious statistics and a lot of "Pump and Dump" tactics. I have been slamming hard on "Hedonic Pricing" and other statistical phoney baloney for some time now. Maybe some others are beginning to wake up as well. We shall see. Anyway, I have much more study to do.
http://www.worldnetdaily.com/cartoons/ashcroft.htmlWhile we're all talking politics here, check out this hysterical cartoon at WorldNetDaily. It's called "This Ashcroft Must Go!" Be sure to turn the sound on your computer so you can hear Kennedy, Feinstein, and others singing.
I would like to say that I have enjoyed much of what you have contributed at the forum as it offers fresh perspective and challenges ones preconceived perceptions.
But I think you error a bit. You said:
"I know that many of you here worship everything they write, and can't wait for each upcoming installment, to praise and fall all over yourselves to wal...er.. wonder of it."
JavaMan: Taken at face value, this is a statement that not only is not accurate, it is belittling to those who you reference. I don't believe there is anyone here who holds anyone else here as infallible or worthy of worship. The fact of the matter is that there are several people that post here who have "earned" a special degree of credibility due to their phenomenal intellect, wisdom or knowledge or because many of the things they forecasted years ago have come to pass. That's all.
And: "And I also know that it is herein considered vastly inappropriate, impolite, and unfathomable to dispute, criticize, or condemn any of their writings.
Javaman: I would offer that, as a whole, this is simply not true. The Guidelines and Prohibitions state:
"Personal attacks; slanderous or derogatory remarks; off-color jokes; lewd and/or lascivious comments; ethnic, religious and racial slurs. [...] In general, the same rules that apply to ordinary civil discourse shall apply here as well."
So, unless it is I who am misinterpreting the rules, they imply it is not acceptable to criticize or condemn another person's thinking, but there is nothing here that prevents one from disagreeing with another's position as long as it is done with civility and respect. Indeed, the people I reference above with particular credibility often state opposing points of view. The key to doing so is that a mutual respect for each other be part and parcel of the statement. And to demonstrate that one doesn't have to be among the "elite" to have such privilege, I myself have taken issue with them and "live" to tell about it.
And: "Indeed, in the past some errant posters herein have instantly lost their posting priviledges for having done so."
JavaMan: I will say emphatically that from the time I first started visiting the USAGold forum (1999?), I have never, ever seen a poster loose their posting privilege "for having done so". It is the one who demonstrates an inability to honor the "rules that apply to ordinary civil discourse" who are no longer. So be it.
ThaiGold, I appreciate your contribution to the forum and look forward to hearing more from you. I also believe a consolidation of Another's writings would be a worthwhile effort and of benefit to many. I would add that not all that is communicated between the members of this forum is done via the forum. Email is marvelously efficient technology.
On the other hand, if you are interested in the concept, why not construct the html file and submit it to USAGold as a "gift" page. While I can't speak for USAGold management, they might be inclined to entertain the incorporation of such a page into the web site, complete with credit to the author of the page(s)! Hmmm....
http://www.hindubusinessline.com/stories/082815gl.htm G. Chandrashekhar
MUMBAI, Jan. 27
EARTHQUAKE in India took its toll on the gold market rather readily. The yellow metal weakened below $263 per ounce during late-afternoon trading in New York on Friday on news of a major earthquake in northern India. Bullion traders expressed apprehension that the quake and consequent dislocation might affect the precious metals trade, particularly because one of the main importing hubs - Ahmedabad - was severely affected. Earlier in the day on Friday, gold closed at $ 263.55/OZ (PM fix) in the London market. The mood was softer despite a positive UK auction earlier in the week. For the last several weeks, gold prices have continued to remain soft because of sluggish offtake in the physical market. In particular, imports into India had slowed down considerably in recent months in the wake of drought conditions in several states in central and western parts of the country. With death toll mounting rapidly and relief operations unable to match the severity of damage, normal life is expected to return later, rather than sooner. International traders are closely watching the developments here.
Black Blade: Not good all around. Not good for those people, and not good for gold. It also happens to be a major diamond cutting center.
Hey ThaiGold - thanks for the response. You wrote in part;
"Today I have read all your posts in response and comment to me. Much appreciated
as always. Thank you. Many feel that I am picking on FOA/ANOTHER or yourselves,
in using terminology like "Lemmings", "Giants", or whatever, has maybe offended
you or made some of you feel uneasy. I plead guilty to trying to make people in
this forum open their minds and rethink alot that has previously been accepted
as gospel."
Since I was the one that called you to task, let me correct your impression. I would humbly suggest that if this is indeed your goal, denigrating readers and those that have earned their respect is likely a poor choice of strategies.
"I know that many of you here worship everything they write, and can't
wait for each upcoming installment, to praise and fall all over yourselves to
wal...er.. wonder of it."
Thanks for the perfect example. I doubt anyone here worships ANOTHER or FOA. They, like me, however, might have much respect for their knowledge and their willingness to share it. Your condescending attitude towards those you claim to wish to enlighten is showing.
"And I also know that it is herein considered vastly
inappropriate, impolite, and unfathomable to dispute, criticize, or condemn any
of their writings."
Nonsense. Personally attacking FOA has been the problem for many.
"Indeed, in the past some errant posters herein have instantly
lost their posting priviledges for having done so. And I may too just for having
written this. So you can see, what I'm up against when I write to post an essay
that contains contrarian theories or fresh thinking."
Nonsense. I'm having great difficulty seeing you as a victim partner. Post whatever theory you like, that is the purpose of the forum, even one contrary to whoever's views, and I guarantee you, you will not lose any posting privileges. You insult our hosts with your comments.
"Trying to spur others to do
a little of their own. It isn't easy. I try to explain things as I see them. And
I try to stay within bounds of respect and politeness. And within the Forum's
Guidelines. Those are important to me. Yet, so is (correct/new) knowledge."
Calling Trail Guide, calling Trail Guide! Are you the mouthpiece for ANOTHER? If so, where is todays REAL TIME ANALYSIS from ANOTHER? I posted very late yesterday messages 46683 & 46684, with my request for information on ANOTHER's analyses.
A good nights sleep has done little for me. I'm beginning to freak since today I still see the dominant topic on the forum is still the ANOTHER retrospective! Ladies and gentlemen, some answers are in order, what gives with this ANOTHER????? As I am new to this forum, the intrigue strikes me as a DEEP THROAT / BOB WOODWARD tale!
In the process of doing a little digging to respond to SLATT's request RE: Another, I came across the link above "ANOTHER (THOUGHTS!)" and wanted to offer it to SLATT. However, when reading further down the page, I saw this:
"For information on ordering "IN THE FOOTSTEPS OF GIANTS", the remarkable early posts of ANOTHER dated October, 1997 thru January, 1998 please contact USAGOLD/Centennial Precious Metals at 800-869-5115. Please ask for Marie."
I was unaware of this product offering until just this moment. I don't know how I could have missed it, but my sincere apologies to USAGold are in order regarding my previous suggestions to Sir ThaiGold.
ThaiGold, I don't know if you were aware of this product offering or not but it is clear that there would be an issue with item # 4. of the Guidelines and Prohibitions, i.e. promotion of internet sites that compete directly with USAGOLD / Centennial Precious Metals.
http://home.columbus.rr.com/rossl/another.htm The page at the link has the postings made by the person using the name ANOTHER (THOUGHTS!) in 1997-1998. These posts were written prior to the USAGOLD posts. Start at the bottom and work your way through. FOA (aka Trail Guide) is an acronym for "Friend Of Another".
http://www.usagold.com/ANOTHER_PAGE.htmlMuch of Anothers posts are recorded at the link I posted. If it dosn't work, go to the USAGold Home page and you can find it from there.
Another began posting at a different forum several years ago. Apparently due to poor manners of other members of that forum, he stoped posting there and started posting here. Whoever he is, he values his privacy apparently and did not want his identity revealed. I'm not sure if the host here knows who he is although I recall some post where MK mentioned someones credentials were extrodinary. But I think that my have been in regard to FOA who is also Trail Guide.
Anothers style was difficult for some to follow. Frankly I think it was intentionally cryptic. Friend of Another endevored to explain what apparently both of them preceive as going on in the global monetary realm.
FOA dosn't seem to want to remain as annonymous as Another. FOA gives a termendous number of clues to his identity, but I would suggest you never ask nor guess publicly. FOA also seems to genuinly want people to understand what is going on.
Another appears to be gone, probably never to post again. FOA carries on explaining so that we can watch this new market together and learn.
Are they right? Lots of what they predicted has come to pass, inexplicable stuff suggesting that they really are plugged in and know whats going on. Should you trust them? I believe that FOA is very sincere. But that dosn't mean that he might not be wrong. From the beginning these two have said listen to their words, and judge for yourself. That seems to be reasonable advice. As for me, perhaps I have a bit more gold than I would if I had never read Another or FOA. Deep down, I suspect that FOA understands how things work in the world, and he knows what must happen. However, there will be twists that he hasn't forseen, and the time these events take to happen could be much longer than he believes. NOONE knows. But it is fun to watch this gold market.
Hey Ross - hope you enjoyed. BTW - I didn't save these posts, someone else did and offered the compilation at a link at Kitco. I'm unaware of the current link if one exists. Apologies to USAGOLD if making this available infringed on your business. That was not the intent.
After saying I wasn't going to debate the views of ANOTHER and FOA, after sleeping on it I changed my mind. We've all been looking for answers as to why the price of gold has fallen into this tight trading range. After rereading ANOTHER's early stuff I found he kept referring to gold dropping to its cost of production but not being allowed to fall any further. He claimed, "For no currency system could stand if "Oil" were to bid for gold!"
This leads me to believe that FOA's and Aristotle's contention that a Free Gold system tied to a move to the Euro as the reserve currency has been agreed to. ANOTHER referred in other posts about the desire to keep the world economy intact, particularly the oil market. It would seem to me we are seeing the signs in US markets of the stress this agreement is having on debt service and energy prices. We haven't seen the bust yet in the paper gold market but it would appear inevitable. We seem to be getting our bust in small, somewhat manageable doses. Californians may argue that point.
"My patience has run out. Although I have a living relative in California, it does
not matter. All I want is for California to leave this union of states and go its
separate way. In fact, the former Republic of California can also take Washington
State and Oregon with it and start a new country on this continent's West Coast.
Maybe they can call this new nation Bolshavia.
"The latest power crisis in which Californians are demanding that electricity
producers outside the state work for free (a nice term for this is forced labor) to
provide them with low-priced electrical power has put me over the edge. Until
now, I could tolerate California, since it generally sends Washington, DC, more
taxes than it receives in benefits (California: The State for Suckers!) and
produced John Wooden's great UCLA basketball teams.
"However, now that California is showing its true colors, I admit that my eyes are
opened at last. Whatever gains I might have from California's excess of tax
revenues has been swallowed up in the Free Lunch Philosophy that has emanated
from that state for many years. California has been Ground Zero for many of the
diseases that have plagued our body politic, and it is time that Californians and
their "Left Coast" fellows bear the full cost of their Jane Fonda Socialism."
Isn't it amazing that what seems so obvious to one can be viewed so differently by another ? Since my friend Peter is apparently the only deflationist that's been holding down the fort at this particular site, please allow me to add a few comments for a wee bit more balance.
Depending on where one defines the seminal moment, the latest deflation cycle started one to two decades ago. Some would identify the shift from inflation to deflation as beginning at the 1980 inflation peak, others point toward the 1987 crash, and many consider it the bursting of Japan's bubble in 1989. From a practical standpoint, it really doesn't matter.
What does matter is that the deflation cycle began accelerating in 1994/95 when Mexico imploded, followed by the SE Asian Tigers, er, Tiggers in �97, Russia in �98, and Turkey the most recent last November. With the collapse of the Russian bond market and the failure of LTCM, the US was quickly spiraling into outright deflation in the Fall of �98 before being pulled out at the last moment by the hair of Greenspan's scraggly rear end.
At the same time this acceleration of deflation began in early �95, the US money supply began exploding as the world ran to the liquidity of the dollar. It's that run to the dollar that allowed it to surge so strongly in the face of massive monetary expansion and record trade deficits month after month.
This monetary accomodation happened to occur at a time when the president had just lost Congress to the Republican Party and was worried about his re-election prospects in �96, only to be followed not long after his re-election by impeachment worries. One has to wonder that if the US had had a real president during that time, one that was concerned only with doing the right thing rather than with his legacy, would such monetary extremes have been encouraged. In any case, it's a done deal and the repercussions are still to be felt.
Another huge burst of liquidity followed on the heels of the �98 near miss as Y2K fears took over. Deflationists (both of us !) expected the effects of the massive inflation that had been taking place over the years, inflation that had been created largely as a result of world deflation pressures, would ultimately lead to outright deflation here in the US.
That expectation is on the verge of being proven true as the signs have again become quite apparent in the last year. The Nasdaq crashed barely a year and a half after the �98 liquidity infusion and hardly a quarter after the pre-Y2K rerun, the dot.coms have dot.bombed, bankruptcies and layoffs are increasing at historically solid companies, and the junk bond market nose-dived. Greenspanic recently admonished banks to not restrict credit to worthy borrowers as the crunch set in.
I happen to work at one of those multi-billion dollar, multi-national, mega-debtors, and it's not a pretty picture. The energy crisis is adding injury to injury as rising energy costs further put the squeeze on companies (and consumers) struggling to service their huge debts.
Inflationists and deflationists alike look at the action of the dollar as the key to predicting where this is all ultimately headed. Both sides think the dollar is poised for a serious correction, if not a collapse. But unlike the inflationists, who see a falling dollar as �causing inflation�, deflationists (at least this one) see a falling dollar as deflationary, and depending on the speed with which it occurs, it could be viciously deflating, as it signals capital flight out of dollar-denominated assets, which leads to liquidity strains and threatens existing financial imbalances.
Consider that on January 3, less than 2 months after the dollar tested its peak in November, rolled over, and sold off sharply the Fed was *forced* into a panic rate cut to keep the financial system liquid.
The same thing happened in the Fall of �98. The dollar peaked in August before selling off sharply and by October the Fed was cutting rates, hitting panic mode in November.
So who's in control here, the Fed or the market ? Who's dictating the terms ? And who's REacting ?
Will the latest cut and the expected cut this week temporarily stabilize financial markets again ? Time will tell.
One answer appears to lie in whether the run to the liquidity of the dollar becomes a run to the liquidity of another currency. If confidence in the health of the US economy returns, then the run to the dollar will probably continue and the game can go on a little longer. If that confidence irreversibly breaks and the run to the liquidity of the dollar shifts to a run into the liquidity of another currency and/or gold then the game will be over. It will be impossible for the Fed to inflate its way out again if no one wants dollars.
Therefore, a strong dollar is critical to the inflationist case. Yet the inflationists are looking for a plunge in the dollar. Hmmmm.
A second answer appears to lie in whether there will be any more, bigger implosions elsewhere in the world. We won't know that until it happens. To get an idea of the possible consequences, we can look at the time immediately surrounding the implosions that have already occurred, the time between when they happened and when the Fed was able to successfully re-inflate.
The circumstantial evidence of dollar action indicates that the blow up in �98 of the Tiggers and Russia and in November of Turkey (was/is anything else lurking out there ?), what many labelled as small meaningless economies, led to the forced liquidation of dollar-denominated assets. If the events of such small meaningless economies could have such an impact on the liquidity of US financial markets as to force the Fed into panic rate cuts, what's gonna happen if a bigger, more meaningful economy implodes ? For instance, it's been widely reported that the survival of many of Japan's major banks is joined at the hip with the fortunes of the Nikkei, with the 13000 level being called make or break support, a level which as been tested again recently. Japan is a major holder of US dollar-denominated assets. If the Fed struggled to re-liquify US financial markets when minor economies capitulated, they're really gonna have fun if a major one like Japan does.
A third answer lies in whether the US economy is already sprawled across the chopping block itself. If so, we'll know soon, as will all those others across the world who may decide dollar-denominated assets are too big a risk to hold. As above, if no one wants dollars, the Fed can't inflate. Weak dollar = deflation.
So how does one predict the future of gold ? I don't know. On the surface, one would think a plunge in the dollar's exchange rate would propel gold.
On the other hand, a run out of the liquidity of the dollar (and, hence, dollar-denominated assets) and into another currency would probably throw the US into outright deflation and possibly a run to cold, hard cash (those paper dollars) as the credit structure caved in. A washout in the gold market would be no surprise. Ditto the bankruptcy of a major foreign economy, which could quickly snowball through US and other foreign financial markets. Ditto the capitulation of the US economy right now.
It doesn't matter to me what happens to gold. If a washout occurs, I don't have to worry about my real money being destroyed and I'll load up on some more (provided that my other forms of liquidity are available). Good for me. If gold takes off and never looks back, good for me. I'm already on board.
One thing *is* clear: The Fed is going to inflate until it can't, which suggests that when D-Day (Deflation-Day) finally strikes, it's probably not going to be a long drawn-out process, but sudden and dramatic.
Apologies for being long-winded. I really am kind of quiet.
Does anyone know the bare bones of the proposed changes in Derivative Legislatiion that is currently working its way through Congress. DEFINITION of bare bones = how it might affect the gold shorts and hence the POG. Thankyou.
Where Were We.....,,,,,,?Looks like we have taken a bit of a detour through Forum etiquette, now it's time for more Visual/Mental travelling. Many of us are clearly and greatly appreciative for your eye-opening trek through Oil-to-Dollars-to-Gold and Drugs-to-Dollars-to-Gold country. THANK YOU once again. Pony is chomping at the bit again and ready to go!
I did receive some input from David G re silver: Apparently the Golden Lily plundered "some" as the 12 Southeast Asian nations were plundered. Pretty much unknown as to how much was there or how much was plundered or what has become of same.
My next Question {not so many this time}---- Are the CB's slowly/quickly losing their bullion as should be the case? Where else would the masses of jewelry around gold afficionado limbs come from initially? Your GOOP guys are accumulating gold so they are not the source of various trinkets. Some say CBs just "rearrange" their gold among themselves, but these trinkets were not made by the likes of our Wizard, but who?
Gotta go- Thanks again!
ANOTHER started his posting around October 1997, after gold had plummeted from the $400 level to around $320 over a nearly 2 year period. A minus 20%, after being pretty stable around $380 through the end of 1995. Hadn't it been stated that Greenspan took the $380 level as the Fed's indicator for apropriate money supply levels?
Was it the stock market attraction dynamic (maybe a carry trade?), or official manipulation, that did that 1996-97 drop?
I think when ANOTHER came on the scene, it was basically a "get ready, it can't go much lower (for physical)" message. But a few more "mortgages" on the national financial stability later and another 15% drop (say $320 to $270) was accomplished. Was this a different agenda being worked than the $380 to $320 drop?
Price has been very stable around $280 during most of the "Another/FOA" period. Most of us influenced by their insights have but a small percentage drop in value, and an "opportunity cost" loss of, say, 5% per year vs. T-bills.
Sorry to sound repetitive on this, but calling the demise of a political reserve currency system is a big and unprecedented undertaking, and one whose timing is even trickier than calling a "normal" market turn.
You're right but, I am looking for progress to know for myself that "time proves all things". Don't tell me about the WA again please. What have you "done for me lately"?
I have done some "cut & paste" from the thoughts of ANOTHER, and ordered them according
to my own understanding. I hope that I have not twisted his thoughts.
BEGIN QUOTE
...
Understand that oil is still traded for a certain number of US$ but after the deal is done
a certain amount of gold is also purchased "with the future flow of oil as collateral"...
In the beginning the CBs didn't sell their own gold. They ( thru third party ) found someone
else who had bullion. That "party" sold to a broker who sold forward for a mine or
speculator or government ) . In the end the 3rd party had the backing from the broker that he
had backing from the CB to supply physical if needed to put out a fire. The CB held a very
private note from the broker as insurance and was paid a small fee. This process mobilized
free standing bullion outside the government stockpiles...
This whole game was not lost on some very large buyers WHO WANTED GOLD BUT DIDN�T WANT IT�S
MOVEMENT TO BE SEEN!...
Well a funny thing happened right after the Gulf war ended. What looked like big money before
turned out to be little money as some HK people, I'll call them "Big Trader" for short, moved
in and started buying all the notes and physical the market offered. The rub was that they only
bought low, and lower and cheaper. They never ran the price and they never ran out of money.
Seeing this, some people ( middle east ) started to exchange their existing paper gold for the
real stuff...
Gold is cornered. Plain and simple. No complicated theories, no options problems. The commodity
value of gold was forced so low in paper currency terms that all of the new mined gold, going
out some 10 years is spoken for. Between the third world buying physical gold and the jewelry
industry ( same people buying ) there is none left for the oil states!
The downfall of the Russia, did allow for the Euro and all that it will build. They now see the
debt of the US$, as a reserve money can be escaped!...
The worldwide currency system is truly a reflection of an economy built from war, using the
American Experience, the US$ and the debt that it represents. But, for the American dollar to
continue as the representative of the global financial system, in the form of being the reserve
currency, maturing generations of all countries must accept it, and the tax on real production
it clearly imposes! In the very same mind set, that people buy the best value for the lowest
price (Japan cars in the late 70s), and leave an established producer to die, so will they
escape the American currency and accept any competitor that offers a better deal.
Because we are speaking of currencies here, the transition will be brutal!...
The urgent drive to create a new "reserve currency" began in the early 80s, after the last small
"gold war". The road to making this new Euro did never include gold in large amounts, until the
last few years! Even one year ago, the news would say, 5% or less. Today, we speak of a much
greater amount! This is interesting, yes? The BIS did "hatch" this deal in a very late fashion!
The future of the Euro was found to be "weak", as the Middle East oil imports onto the continent
would continue in dollars! This was so from the dollar being made strong in gold. Gold priced in
dollars at near production cost, offered a "no switch currency" position, for oil...
If you haven't already,I would suggest you read the debate between the Traveler and Trail Guide/FOA.These posts start at the Traveler,#39272 and 33971.Trail Guide then responds to the assertions and theories presented at #39784 and #39794.Next a rebuttal at,#39955 and a follow-up at FOA#47.
What really got me thinking long and hard about this epic reckoning that is now rumbling down the tunnel are these quotes from Trail Guide's,#39784:
"Conversely;the "real" inflation,I point to is largely a cash phenomenon,where all the past massively over created credit instruments are bought up by the money making authorities and paid for with printed cash or allocations to the owner's digital cash accounts"
"however,in the real hyperinflation that's coming as it follows our current credit inflation phenomenon,it's not the borrowing class that's liquified,it's the lending class!Remember,out there in our vast dollar world,for every dollar a consumer has borrowed'some entity holds the other side of the credit instrument.Our classic deflation begins when these holders are longer being paid,resulting in the write down of their assets".
"no country ever hyper inflates for the pleasure of the ruling class,as many believe.They/We inflate to keep the domestic system in use and do so because it's the last resort.In other words you are forced into it!
There is so much more contained in this debate to ponder.As the Traveler says in his second post;"do read the complete message for a fuller context and more vivid understanding.Your wealth and your grandchildren demand this of you."
Hey turbo - thanks for the analysis. At the risk of suffering the wrath of the Stranger, I'd add my agreement to much of what you write. I seems the Fed is in crisis mode attempting to reflate a monetary system obviously in deflation mode. I'll give you an example from my business.
The last couple of years, truck manufacturers have offered easy credit terms to owner/operators on new equipment to keep manufacturing of this equipment rolling. Since about this time last year, many of these owners have attempted to return the equipment to the dealer and leave the business. Initially, this equipment was placed on the used market until the number of vehicles had overwhelmed the dealers both financially and physically (malinvestment). The underwriters of these deals are now telling owners of these vehicles to hang on to the equipment even if they can't make any payments at all. In other words, once the vehicles are returned then the underwriter has a loss on its hands and must show it on his books. Deflation. This reaction to potential destruction of money is widespread in other industries such as we've seen with Lucent in the tech sector. Better to carry the note even if it is non-performing, than to write it off and put your credit at risk. Sounds like Japan, eh?
We seem to be on the knife-edge between the onset of a deflationary spiral which spins out of control and a hyperinflation which spins out of control. Some here believe the Fed can reflate at will and prevent a deflationary collapse. Like you, I believe that remains to be seen. The excesses are so great that I doubt any long term return to inflation is possible until some type of writedown is completed, but it will not stop them from trying nevertheless. At some point the losses will have to be suffered whether it be by the taxpayer in the form of bailouts of the banking institutions during the deflation or by the taxpayer in the form of currency depreciation during a hyperinflation. Maybe both. Has there been a better time to own some gold? Has there been a worse time to be a taxpayer?
Now you couple this with what we know about the gold and paper gold markets and the seeming disparity between the two. I can see this situation getting away from those that attempt to keep all this under control.
Where do we go from here?I do believe the CB's are losing their gold. Maybe the other source of gold could be gold in smaller countrys releasing smaller quanities all at the same interval. If the Goop guys are accumulating gold, Ask why? Get rich? Play havoc with the CB's. Finance a war. Oil- Economy-Markets effect the price of gold. The only option not discussed is war and the Jews and the Palestinians are not good buddies. Right in the middle of the oil fields. He who has the most gold wins?
Saddam H. has been brokering his oil here lately. Some type of deal. Think they are playing by a different set of rules.
Play it again, Sam, ah, Mr. G! @Mr Gresham msg#: 46729, ALL
http://www.gold-eagle.com/gold_digest_01/schultz011901.html "Sorry to sound repetitive on this, but calling the demise of a political reserve currency system is a big
and unprecedented undertaking, and one whose timing is even trickier than calling a "normal" market
turn." -Mr Gresham msg#: 46729
Say it early and often, Mr. G! This is indeed an unprecedented call. Especially from the current establishment -- even the establishment far-out fringes.
And calling the timing of anything is the most difficult part.
Is this a "correct" call? Not if "they" can help it. Remember, they've pulled many a rabbit out of the hat since 1933.
But shipping all those "dollars" overseas puts things out of "their" control and, in fact, out of any one body's control. You can stop a bank run if only you and a few friends know there's a problem. Once it "gets out," however, then it becomes a game of chicken. Once the first major holder PUBLICALLY heads for the door, the rest will break and be close behind.
A lot of folks who didn't before, now know they may be in that game of "chicken." When will this happen - - - IF it happens?
Interesting stats from Chevalier Harry Schultz:
The US$ is "over-owned." 77.7% of world central bank reserves are in US$'s.
That's disproportionate to the US share of world trade. There'll now be
some diversification, esp to the euro. Just as central banks sold gold,
they'll now sell US$'s. A study revealed at central bank confab at Jackson
Hole, by Prof Obstfeld & Rogoff, suggests the US$ could drop 24%-40% if
foreigners move quickly to exchange $'s. Foreigners own a record 38% of US
Treasury mkt ( 44% excluding Fed Reserve holdings ) , 20% of US corp bonds,
8% of US stks. A change of sentiment, now suddenly in the air, could start
a $-brushfire. -The International Harry Schultz Letter [link in header]
Interestingly, my notes from Alan Greenspan's latest Q&A testimony read thusly:
~~"It's my guess that because of the risk-free nature of U.S Treasuries, foreigners would be willing to keep them even at a much lower interest rates. And buybacks would require horrendous premiums to get them to give up their safe bonds. " -Alan Greenspan to Senate Budget Committee, Thursday, January 25, 2001
Perhaps the seminal question with regard to "flation" is, since the U.S. dropped gold convertibility in 1933, has there ever been MONETARY deflation - - - that is, a decrease in the quantity of fiat money circulating in any country, and thus an INCREASE in the buying-power of that fiat money?
ORO could come up with only a few (two or three) small and transitory examples of such MONETARY deflation. ALL the Asian Tiger fiats lost major amounts of purchasing power, as did the ruble, drachma, Turkish lira (as we speak), Eucadoran sucre (inflated into fiat heaven), Brazillian "real," (time after time) etc. etc. etc,
SO, if you wish to argue for MONETARY deflation, what leads you to believe the U.S situation, including all those overseas dollar denominated thingies remember, would be different than all other currency devaluations since 1933?
ET...thank you for the kind offer to send ANOTHER data
But I already hold this text safely on my trusty MacIntosh, dating back to the earliest October 5, 1997 post.
Again, I have two other pressing issues, but shall then address the issue of formatting this archive for readability and provide links immediately thereafter.
I agree with the majority of your post #46671 "a few observations", but please allow me to express another opinion regarding one issue which you raised to illustrate that TG can't always be right. Cavan Man queried regarding the significance of this quote from FOA: "How do you get oil to rise? Today, we stop our CBs from selling gold!" (11-5-1997)
You said: "Well, I hate to tell you, but oil went up with continued gold selling from CB's."
Remember that at that time (1997), Another & FOA (and other "gurus" I might add) were anticipating a climax in 1998 which did not occur. They were clearly wrong here. However I believe they were, in this statement, presaging the Washington Agreement which may have been planned well in advance and which did in fact accompany higher oil prices, but in 1999. Those who say, "Yeah but CBs are still selling gold" are right. But it appears to be gold from the Fed "returned" to rightful owners to prop up the dollar (and the Comex) a little longer. How much goes into "Oil's" hands is another matter. If you think oil is "up" now, you ain't seen nothin' yet. When the Comex and the dollar break, stand back. To those who would point out that oil began rising earlier by several months, I would suggest that "Oil" knew in advance and anticipated what was coming. Remember, "Oil" and Europe (BIS) have been talking. The same thing happened in the early 70's when Nixon closed the gold window, but this default may have taken "Oil" by surprise. "Oil" says "I want gold. If you force me to take paper, I want a much higher price because I don't trust it." So to summarize, when "Oil" doesn't get its gold, oil prices rise. I believe TG was right about this.
ET: Thanks very much for your comments. Anecdotes such as yours are a very important part of sizing up the big picture. Yes, you'll likely incur the wrath of TheStranger for agreeing with anything I have to say. Afterall, I'm a man with a hammer � and everything *does* look like a nail. That's alright. I don't think TheStranger bites.
My own little anecdote, similar to yours:
Driving home from the airport one day last month, I heard an ad on the radio of a local automobile dealer here in Houston advertising new Mitsubishi Gallants on the 0/0/0 plan � $0 down, 0% interest, and 0 payments for a YEAR ! Pretty nice cars ... I've rented them a few times ... and they're apparently collecting dust and cobwebs on the lots.
Firesale coming soon ! Especially on cars, homes, and other assets bid up by easy credit. Gold ? Perhaps the exception.
>Has there been a better time to own some gold? Has there been a worse time to be a taxpayer?<
Man, you said it all right there !
Old Yeller:
Thanks to a couple of Forum friends, I did catch the debate between Traveler and FOA/Trail Guide and that's what got me reading this site a little closer again.
There are some specific reasons why I don't buy FOA's reasoning that I've not taken the time to write down. Maybe at a later time. But they rest on the fact that we live in a credit economy, not a currency economy, and the fact that e-money travelling at the speed of light can be destroyed faster than a team of bureaucrats can meet, come up with a plan to print more cash, order the cash, have it printed and delivered, and then pumped out into the economy.
What those thoughts you posted by FOA do suggest is that *if* there is going to be a hyperinflation after the deflation, it may come a little sooner than this deflationist expects.
But as you point out with that last comment by Traveler, this is all definitely something everyone needs to reason out on their own.
Sir Stocks Lies & T.T.
Welcome to the discussion. Most of us here wish we had the ability to stick a floppy disc in our mouths and download information that takes months and months to absorb by reading,(an instant education) unfortunatly it takes a lot of reading time. If you can take the time to read all those links supplied by the other posters you will find out who ANOTHER/FOA and Trail Guide are and what they have written up to this point,IMHO well worth the effort!
Sir E.T.
Thanks for all the postings over the last few days. This one from yesterdays 46667 kind of jumped out at me enough to make a comment:
From the words of ANOTHER:
<<"Now we approach the final act.
"There is one oil state that no one will play for a fool. The CBs will sell all of their gold or the nations will
nationalize all mines and operate them at a loss. One way or another, most of the paper gold market will be honored. Why? Because oil will bid for gold if they do not! We are not talking about an oil embargo or rising oil prices. Indeed, oil will become very cheap for those that can supply physical gold. This deal will not require the agreement of all oil states. Only one can start this, the others will gladly follow.>>
Comment:
It would seem to me at least 3 oil producing countries could implement the action described above by ANOTHER, Iraq,Libya,or Iran,,'selling oil for Gold.They haven't done it and as far as us Americans know don't even hint about doing that.
WHY???
Well, as ANOTHER said,this action by any one of the above mentioned countries could quite quickly destroy the U.S. dollar as the worlds reserve currency. It also might bring tremendous military consequences to the instigator.Noone wants that!!
Sooo, with these thoughts in mind it is my humble opinion that some oil producers may be helping to keep the Price of Gold(and maybe Silver) depressed thru the actions in the paper Gold markets,(A bloodless coup of the U.S. dollar) to accumulate as much Gold as possible thru normal channels,(Dubai{sp}may be the worlds leader in selling physical Gold)for themselves and their citizens, and most naive American paper dollar investors are playing right into their hands, because at some point the "crash" of LBMA or COMEX( it has to happen eventually)will change the worlds perception of Gold from a commodity into one of what "Real Money" really is, than the real rush into Gold begins.
When will this happen???Your guess is as good as mine, I don't know, but I have been preparing for the last few years. All, please think about this....Thanks for Reading....beesting.
Tried to peak through a curtain, within the limits of an Internet forum, into a world I don't live or work in.
If I were a reporter like David Guyatt, I might try to walk through some curtains. Make a few phone calls.
If I lived next door to Paul Volcker, I might get into friendly chats over the hedge and ask a few questions.
I've studied economics since 1966, but I've had to learn and unlearn a lot in the past two years. I think we're on equal ground here. Six blind men describing the elephant.
Please click the link and scroll down to Trail Guide's reply directed to Henri .... specifically, Trail Guide (msg#: 35584)
You may find it helpful or necessary to appreciate that many early comments ("predictions" as called by many) were made in a dynamic political environment as the euro was in its tenuous pre-launch phase. Surely, we can all relate to these kinds of "predictions", as this similar example shows: "Young man, your room is a mess! You had better clean it OR ELSE!!" Some people fail to distinguish the conditional "OR ELSE" commentary ("predictions") from the other related commentary which predicts unconditionally that one way or another the dirty room shall in fact get cleaned.
My view only. Accept or dismiss it at your pleasure.
Whoops,in having all of these posts printed out and available for reference,I forgot how difficult and time consuming it is to find them just by post#.
Asian ConnectionSlingshot-Ya gonna use that thing on Goliath {hopefully}?
Thanks for your input in sorting through the GOOP. I don't think one will ever run out of reasons for accumulating gold, it is just simply within us.
Here's an interesting post from OG's post #46420{read it if you dare}--"No one is going to be so foolish as to rock the boat when millions upon millions of dollars flow into the bank accounts of the British oligarchists and more gold is traded on the Hong Kong gold market than the combined total traded in London and New York."END We don't often consider the Hong Kong gold market and its "mechanisms", and this certainly comes as a surprise to me that it would be so productive. So HK>BIS>COMEX; yet Comex largely sets the dollar price, right?
Here's another quote from same article: "The'Dope Season', as it is called, sees a flood of gold traded on the Hong Kong market."END So exactly what time of year is this Dope Season? Not talking about Calif.
In regards to the Oil/Gold relationship and charts; I have been under the impression there was a positive correlation between the two until the last few years. This is not so?
Let me just make a few generalities in regards to some of these more obscure issues; Black Gold, Oil-Dollars-Gold, Drugs-Dollars-Gold. IF these are legitimate pieces of the puzzle {obviously I believe they are} and they are totally overlooked or dismissed, the market conclusions one comes to is also missing a part or two, or half the picture even. Trail Guide has several times mentioned he was going to weigh in on the Black Gold issue, but I have yet to see anything of substance. That is not a complaint as it just doesn't seem to be his area of expertise for whatever reason.
My goal is to learn as much as I can as fast as I can from ALL credible sources. These many GentleExperts on site allow us to play "20 questions" with them most generously and graciously and this guy is like a kid in a candy store on an empty stomach. Very grateful to those who will take the time and care in boiling down the essence of a lifetime of learning for presentation for a quick study! Exponential learning. It is also quite apparent that at some point one knows just enough to shutup, so this sharing is even that much more generous.
ThaiGold- Silver well rested for Gold Vision Quest encore??
What you point out is where I see the crux of the confusion. My opinion here may be considered off the reservation, so take it for what you're paying for it.
Virtually everyone has come to associate the supply of money with its purchasing power, which is a holdover concept from when it was actually backed by something real, and pretty much seemed to hold true through subsequent currency inflations, which were very obvious due to their physical nature. But we know first hand that that is not a valid premise. The dollar has increased substantially in value despite the fact that the money supply (by way of credit) has been aggressively expanded over the last few years.
Two things have changed in the last 30 years:
1) Today's economies are credit economies, not currency economies, so that dynamic has changed. Lots of money can be destroyed, and very quickly. In the past under a hard standard, a monetary deflation increased the purchasing power of the remaining available currency units. Not necessarily true today. Why ? Because �
2) Today's currencies are fiat. That means their value is *arbitrary*. Their exchange value can adjust on a whim regardless of how many currency units are out there. It's all about confidence.
Therefore, when investors pull their e-capital out of an e-conomy en masse, they not only destroy much of the money supply in that economy (deflation), they are also voting no confidence (devaluation).
The only thing that really matters today is whether or not the demand (confidence and increased purchasing power) or lack of demand (lack of confidence and decreased purchasing power) for a particular currency allows for expansion (inflation) or forces contraction (deflation).
Today IS different.
Greenspan is walking a tightrope. I bet he's got some serious asstroids.
Sirs,
Please would someone explain to this knave how, or under what circumstances, we might come to a situation of dollar deflation given the present conditions with which we are faced? There is no difficulty seeing inflation as a possibility. It is occuring now. But, in the discussions taking place around this table the possibility of deflation is presented without an understandable (by me at any rate) explanation as to what might bring it about. Thank you all. MT
I have several unfinished discussions I wanted to some day return to. The Traveler series was a good one. The aspect of Black Gold was another. Then we could breakdown Mr. Greenspan's thoughts. All in good time. Recently, I began what would be quite a side journey at the GoldTrail Page. Just now I see a need to explain the entire timeline of events that lead to our offering "Another's Thoughts". Why he said what he said when he said it. All this in the middle of an ongoing adjustment I'm making myself, in my life. And,,,,, I offer all this to all free spirits that would consider these things. What do I get out of it??????
How about: "Hey, I read your stuff and don't like it. But, thanks for the effort".
OK! Fair enough.
How about: "Hey, you are all wet and here is my views why you are wrong".
OK! Fair enough.
How about: "Hey, that's interesting, thanks for the effort and here is another question if you can get around to it".
OK! Fair enough.
How about: "Hey, I don't buy it but your story is a process that's not finished yet, so keep talking and I'll keep an ear open.
OK! Fair enough.
You know, Another said a long time ago that we had said enough for most to follow. And he felt he had disclosed enough to average people,,,,, even how they could ride out what was coming. He was going to drop it until it all starts to unfold. Then start again. But I thought, being an American, that it would be interesting for everyone over here, if I just walked along and pointed out some of
the play by play action so the train of thought would not be lost to the average guy.
But then, I never realized that there were so many nuts in the world. Like that one that stomped Another at Kitco, endlessly. I thought they were few and far between. Then several of them even started in on me over here. I don't know, but it seems they all went to the same school,,,, or they are all the same person? Their line of reasoning always starts out as a regular discussion, then degrades into some personal attack. Again, always the same thought process saying: "you people are all being mind controlled if you discuss any of this with them". I have to ask you all ,,,,, What the hell is that anyway?,,,,,, what are they getting at?????
Now it comes to, when someone can't make his point, he switches directions and practically calls me an agent of drug dealers. Jesus! This is the absolute worst hit I can take!!!!!!!!
What is next? Will he ask Stranger, are you some agent dealing drugs with your trading in and out of NEM? How about Randy, will you be profiled as moving opium out the back a pick up, using the trading profits from your gold trading? Is there no limit to this?
I guess it would not be so bad, but,,,,Why is it everyone here presents themselves as conservative and glad to get them people out of the White House,,,,,, then several of us goes on to ask Thaigold to further his logic as to how Giants are moving dope along the Trail???????
Good God!!!!, how do you think this reflects on me and others on this side of the screen?
Well, go ahead and jump to that boy's website and while you are at it let him explain how the gold world works! Let these guys explain the reasoning of international politics and money flows,,,,,,,, even let them explain the
"Thoughts of Another",,, I damn sure won't now,,,,
Because I wouldn't want any of you having your kids see their parents discussing gold on the internet with some outlaw like me!!!!!!!!!! The more I think about this the hotter I get!!!!!
To all of you that have supported this effort, I thank you from my heart. And I will continue to hike the GoldTrail. But on that venue alone I will stay for a good long time!!!!!!!
And things are further complicated by what particular additional I.O.U.s are operating as part of the supply of these variably valued fiat megabyte(92%)/paper(8%) tokens. Witness Greenspan's admitted inability to nail these ever-changing phantoms as to whether or not they are money, near money - - - or whatever!
Want his job?
None-the-less, the "modern" precedent is MONETARY inflation, certainly in the sense the money (and the I.O.U.s promising to deliver it) buy less, even if the reasons for this aren't quite as straight forward as they once were.
auspec...another read-through may prove more luminescent
http://www.usagold.com/goldtrail/You said:
"Trail Guide has several times mentioned he was going to weigh in on the Black Gold issue, but I have yet to see anything of substance."
Have another look at FOA's latest (msg#56 "The Gold of Troy!") at the Gold trail. While he does not explicitly state that this commentary is to address the "Black Gold" issue among other things, it clearly forms the foundation of thought that more thoroughly builds the necessary historic context that I myself so failed to impress anyone with in several commentaries during recent weeks.
His skill of presentation in this effort greatly exceeded my own attempts, and I was quick to call attention to this fact in my early morning post Friday the 26th. Again, (but perhaps to my rooftop eye only(?)) this post serves to prepare the reader for a engaging in critical analysis as to whether such magnificent tales of great storerooms of "black gold" can stand upon their own firm legs in a real world historically shaped by human motivation. For reasons I have previously expressed (however poorly), it remains my objective view that such tall tales must have long bodies and necks because they certainly have no evolutionary (historical) legs to support them.
And on another note for those keeping score, I have completed one of those two high-priority tasks (now in the "out basket" here at The Tower), so the archive project is sitting Number Two on the list.
Of course if debt dollars are destroyed (someone reneges on a payback), there are less dollars available to spend on things. Could lead to price deflation.
But the question is: Where do the surviving dollars flee to, so they don't get destroyed (reneged on, too)? Tangible assets.
Everyone's had enough of promises for awhile and the market revalues them. Processes (your labor -- wages, business dealings -- stocks, debt repayment agreements -- bonds) get down-valued. Results (raw materials, basic resources, end products) get up-valued. Stagflation.
Envy. On the Internet, any Joe can have his say. But then he sees someone else getting listened to more than him, and he thinks he deserves some, too. So he gets a bit, and he wants some more. He thinks he better separate some of those listeners from the other guy, 'cause it must be costing him some of the audience he deserves.
Most people come here with a pretty good attitude. Actually, an excellent one. We have good companionship here. We have maximum freedom here, and we rarely abuse it.
Judging from other good sites, there are up to 100 readers for every poster. You're not wasting your time here, however you choose to post. One guy on an ego trip doesn't cancel the rest of us.
Trail Guide - of thick skins and golden elephants eating poppies
I was troubled by your reaction to the associations some people put up in relation to your remarks. Gold opium and money in general are all interelated going back 300 years or more. Anyone talking of gold will find himself in communication with people who view it only (or in part) from the viewpoint afforded by the opiate drug trade.
As disheartening and repulsive as these associations are to you, you can't escape having public discussions of gold and money turn to them. It will not damage your message because the reader can well distinguish between your own postings and those of others. Hiding on the gold trail will just limit the public discussion you obviously want to develop. I suggest you ignore the postings you regard offensive, and obviously you should not be so sensitive as to take these attacks personally. Being called names and associated with all things evil is the price one pays for having a public discussion.
One as knowing of the world as you are should not be surprised, not to speak of abandoning the discussion, by the loud protestations by some that your Saviour is Satan. Whatever position you take, whatever you hold most dear, it will take but a few minutes to find someone who holds them in contempt and loudly complains of your association with the most low and loathsome.
You may not have the stomach for the chaos of the public forum, but if you can handle it I beseech you to continue posting outside the trail.
Jesus was called "the Liar" by the sect writing the Dead Sea Scrolls. What would the world have looked like had he stopped talking when that started?
Dear Sir,
I'm sorry, but I still never put any links together with you or anyone I know associating with drugs. If it was there it went completely over my head. My sincere apologies if I have offended in any way, because it would certainly be unintended. I thought ThaiGold was using the term Giants in reference to "OTHER" Big Players in this scheme and I cannot imagine he was referring to you. He will certainly speak for himself. I have nothing but respect for what you are doing and your efforts and that is what I am also referring to in post #46784.
Personally, I have read all of Another and FOA's thoughts and found them quite remarkable. Apparently, some with limited vision, and patience, seem to have trouble watching the "flow" of events as they wind on. I'm sure that many people here would like the entire story to unfold more quickly, and transparently, so they could gain more understanding of the transition process as it unfolds. All I ever remember was a call from Another/FOA to consider their message, and judge for yourself as the real-world events unfolded along the trail. I never recall them using condescending terminology and ridiculous "vision quest's" in a feeble attempt to gain ..."lemmings"....I believe. IMHO, the flow of events which will lead up to the transition seem to have been forecasted rather accurately up to this point, with the exception of Another's early call, which can indeed be excused due to the very nature of what is to come, coupled with the, at the time, uncertain status of the Euro launch.
Trailguide/ FOA....Thanks for taking time out of your life to help those of us who want to, see and understand. When all is said and done, those who have the ability to consider, and think for themselves, will owe you a great debt for putting up with a few envious, insecure posters.
The discussion of deflationary elements in the Kondratieff cycle are out of context because of the aspect of gold. Gold was the denominator of debt in all prior Kondratieff waves. The current wave is the first one in which gold has no official role in denominating debt. Therefore the pricing aspects of products and labor vs. gold does not play a part in the currency denominated world. Therefore, the specific pricing imperatives of the Kondratieff theory are in question when applied to prices denominated in currency.
Lest one jump to conclusions regarding the Japanese situation, as supporting the applicability of Kondratieff theory to fiat currencies, one should consider that the Japanese money supply is backed by dollar asset holdings and till dollar assets and the dollar's home economy are undergoing the contraction cycle, the jury remains out regarding this claim.
The application of Kondratieff's observations to prices denominated in gold will probably be seen soon enough. Viewing gold as just another commodity denominated in fiat currency is a big mistake like that of the Monetarist's and Keynesian's predictions of the price of gold dropping from $35 to $5 when the dollar went off the gold standard.
Furthermore, it has been my contention that the dynamics of a debt currency do not permit the possibility of price deflations because of the fact that both the money and the demand for it arise from the same cause: debt denominated in the currency. If the debt is no good, neither is the money that denominates it as both asset and liability. In the Kondratieff cycle's final stage, when the general preference shifts to holding cash, the only possible cash and the only historical precedent for one is gold.
Even for the last iteration of the cycle, in the 30s when the US was not on a gold standard internally, there was no problem for particular large traders to convert dollars into gold outside the US, thus leaving the dollar as a gold certificate, and making pricing relative to the dollar identical to pricing in gold.
To think he cuts interest rates to save the economy is nonsence.He is a banker,and bankers lend money at the highest rate the market will bear.Since the number of loans at the existing rate is sharply declining,he lowers the rate to get the most loans at the new rate,and so on.He doesent lead ,he followes ,always maximizing the number of loans at a given rate.This also explains why he condones the gold hedging .He as the nations top banker believes in paper (fiat) money .If he really wanted to save the country from a depression he would encourage an immediate devalueation of 40% of the dollar.We have been giving manufacturing jobs away .All those dealing in paper ,finance,dirivatives and banking have had a field day at the expense of people that actually produce something.There is no way out,if there was they would have done it back in the thirties.Bankers will foreclose to turn thier paper loans into real assets like real estate, farms,mines etc.These criminals shorting gold and commodities should go to jail.They cannot possibly cover thier shorts.They think they are too big to let fail without bringing down the banking system.If the taxpayer must bail them out ,then there must be mandatory jail time.
This is what the Swiss do.Thats why most foreign banks don't need (FDIC)like government insurance .They are forced to act responsible by threat of jail.
Read OG's message and I do not know how I missed that one. Very solid for opium/gold connection. Agree the boat is steady as she goes. I concede partially. I call it a wild card. My reasons.
Set precedent. 1967 1972 wars.
Diffenent Ideology/Religion. To prove one right proves the other wrong.
Arab Proverb; The enemy of my brother is the enemy of mine.
No disrespect intended only wanted to show deep conviction and how it could play out in world matters.
I therefore recall the dogs of war and place them in my back pocket.
Trail GuideYes, Randy, I have read "The Gold of Troy!" and will do a re-read. It was of interest historically, but had no idea it is to have some form of sequel. Obviously a lot of effort went into it, but it falls short {to date} of addressing the Black Gold issue comprehensively, in my opinion only. Maybe I'm being ingrateful, but was looking for something different. Maybe something "different" doesn't exist.
You and I have hashed the issue to a degree, at least to the point of agreeing to disagree. That is where I intended to leave it at least as far as the two of us are concerned.
Honestly, I'm a bit bewildered right now as to how these issues have blown up on site today. I'm a sensitive person and never saw it coming. Hopefully ANY damage can be repaired. Hopefully this is one huge misunderstanding. Like when ThaiGold said to Pandagold "off with your head"; I knew he was joking about the misspelling of his name and it was taken wrong. Makes me wonder if there are many past issues that are now surfacing?
Anyway, please allow me a rephrase to Trail Guide: I do appreciate your efforts, I had no idea your story was in process, please keep talking and I will listen carefully. The worst thing that could/should happen, in my mind, is that we end up agreeing to disagree. We all deserve that lattitude. Sincerely.
We've been at this point before haven't we; here at this Forum, you and I and many others? Yes, there are a lot of kooks out there/here. What did you expect? This is a "western gold venue" for discussion isn't it.
You know all that stuff about opium? I cruised right through it and I know many others did. Whether that is true or not, who the hell cares anyway. Following your trail, I am interested in history in the making, not history.
I'm glad you allow for many to doubt your friends thoughts and your own running commentary. Let's face it, those thoughts are far, far off almost everyone's radar screen. In fact, you must admit that, for the average person, they are almost totally unbelievable.
Well, although I personally am impatient and a cynical second-guesser of almost everything, I want you to know how very much I appreciate your time and effort. I am very thankful! If you were only hoping to have made a significant impact in one person's life, there you have it; it is mine. Oh, BTW, there are four others who depend on me and they are some of the nicest people you could ever meet.
So Another thought he had said enough? Ha. No, he hasn't said enough. You can't just drop a bombshell like that and not expect to take any flack (especially at a gold forum) and then just disappear. I am grateful to him and I am sure he is a very good man etc and all of that but, who does he think he is? I mean, he and his friends may hold my economic fate IN THIS WORLD in their hands but give me a break. He puts is pants on just like me. He owes us more after getting this train out of the station. Yes my friend, he does indeed. Please tell him that you know one tough minded (thick headed) Irishman who is calling him out.
I have a suggestion and I am taking myself up on it hoping you will too. I am out of here until 3-1-2001. Nothing good is going to happen to gold in thirty days. I'm sick of talking about it. Take a break my friend. It is well-deserved.
God Bless you TG whoever you are and God Bless all here.
@ MK _Apologies for not responding to your UK re NAFTA Q.
Well, firstly I've been "reduced" to family festivities, celebrating two 80th. birthdays in a row( not mine yet, (un-fortunately?) and had to get the Feb. issue of the GM Journal into shape and I'll still be there for a couple nights.
Nah, NAFTA would get the UK definitely now between 2 seats, even as Tony was playing with a stacked pack of poker cards - he will now have to face some reality in the coming elections, soon to be viewed in this cinema, no bluffs though more cliffs - and IMHO the reality is still the continent and not the long gone "dominions", some minions still dub colonies. ... As the late re-industrialization in the aftermath of WWII - the real losers
of a winning team of allies - find themselves in the midst of another battle, and this time for the next generation of productive capacity - having had a late start in the end seventies of re-equipping their industries - to play catchup. A situation, which is becoming more difficult with the day, as the resource base is gone and the financial market supremacy is challenged. It occurs to me to be oversimply-fying - though don't forget that the EU was in reality forged and enhanced by the likes of Helmuth Kohl, Maggie Thatcher and Giscard -d'Estaing - the exact opposite numbers of the Schroeders, Blairs and Jospins. ... and so was the euro - your still skeptic cb2
PS: ORO - your latest 'flation expose' was just as my doc
described - digestible, though I still don't buy black
gold.
.
PPS: TG/FOA - being skeptic, though a follower and as you
have already diminished my defences - disarmingly - I
just may defect to track the footsteps of giants. ...
As long as I retain the liberty to "dig" for my own
gold ... so please let nothing affect your singular
contributions on this trekk.
I've often wondered if this particular K-wave has not been run out farther than usual due to the invention of the
A-bomb and the PC? It is difficult to determine ones starting point peak to peak though, and the real state of the economy,ie inflation or deflation. Any thoughts?
Thank you!!!! To all who helped with my request for info on ANOTHER and FOAs post
Today I have read the first 50 pages of ANOTHERs posts. It is clear why these posts have held the attention of this forum since 1997! I am sorry, but I am in a greater "freak" than when I began reading the ANOTHER posts! I find it difficult to put this stuff down! I (we) now have the benefit of 3 years hindsight. For me it has been (so far) a true epiphany, I increasingly run to my wife to show her the written word of ANOTHER that gives justification for my actions that I only had my gut feeling to guide me! There really is a greater method to the madness of the POG over these years of the US$ printing binge!
My heartfelt thanks to all of you who took the time to post your help to me on this: JavaMan, RossL, Cor Tauri, and ge(who for me, brought some good things to light!)
Geez - I sure hope you reconsider. I'm sure nobody meant in any way to imply or infer you have been discussing the drug trade with your comments.
One of your new fans just wrote;
"Today I have read the first 50 pages of ANOTHERs posts. It is clear why these posts have held the attention of
this forum since 1997! I am sorry, but I am in a greater "freak" than when I began reading the ANOTHER posts! I
find it difficult to put this stuff down! I (we) now have the benefit of 3 years hindsight. For me it has been (so far)
a true epiphany, I increasingly run to my wife to show her the written word of ANOTHER that gives justification
for my actions that I only had my gut feeling to guide me! There really is a greater method to the madness of the
POG over these years of the US$ printing binge!"
He is right! We now have the benefit of several years of hindsight and I, for one, am certainly looking forward to anything you or ANOTHER might have to say. I'd like to second Cavan Man's thoughts regarding ANOTHER. Perhaps you can coax him out of his "retirement". This has been an amazing few years and I want to thank the two of you for all you've shared. As you can see from the above comments from Mr. SLaTT, your work is not yet finished.
Ladies And Gentlemen,
You all have come so far in this forum to have bad feelings among us. Opinions can very quickly become doctrine and the walls of silience raise up and Truly what we all come here for disappears. That is sharing information. Would we all still be here if we were up to our ears in gold? Is the frustration level that high that we now turn on each other for minor offences. Heck, I put some whoppers on here , time to time. I value all information and a little humor too.
Its the one you don't see that gets you!
May tomorrow be better.
Slingshot
1. I see inflation all around me...housing costs, energy, medical costs, and recently I've noticed food is moving higher as the energy costs start to kick in.
2. The nation is still basically at full employment. What happens if/when we go from 4% to 7%+ unemployment? Well, I think housing costs will come down, but energy, medical, and food may not. A mixed bag? And what of consumer products?
3. It's the dollar, stupid!
I found the link I posted earlier thought provoking, but I'm not sold on the deflation part. It seems to me that Greenspan is trying to fight a post 1929 type scenario, but that does not mean he is right that deflation is coming as the equity markets burst. To be honest, this is such a screwy situation we are now in -- I'm very cautious on all predictions...yeah, it's fun to speculate, but I don't believe anyone truly knows what's around the corner. (But, of course, I could be wrong ;-) There are just too many variables.
One thing I do believe is that physical gold ownership is a low risk insurance policy in times of such uncertainty.
I hope I didn't come across as too combative in my "guru" post last night. My intention was merely to get people to realize that predicting future economic events is a risky venture for us mortals.
My apologies to anyone who may have taken offense at my remarks.
Re: FOAThis business started a couple weeks ago with FOA's 'shot' at silver on 'The Trail'.
Thaigold defended his views on silver and several others came to Thaigold's defence, including myself.
FOA did not (at least to my satisfaction) retract on his attack to the spears sent to silver investors. FOA usually shows tact but, IMHO, he did not on that day.
FOA nearly succumbed about 4-6 months ago on the fierce paper/physical discussion but the paper player was 'booted' off the forum before things got out of hand. Subsequently, FOA was enticed into resuming his posting.
As per guidelines on this forum I am not attacking FOA, I am merely pointing out history.
What makes Greenscam think he's any smarter than officials in the 1930's.We all know the money supply contracted,therefore Greenscam inflates the money supply.They thought then the same thing as Greenscam thinks now but were over whelmed by banks closing and the ensuing loss of credit creating capability.All Greenscam will do is substitute worthless paper instead of loss of credit.History repeats itself ,but not exactly the same way.We will probably have a German type of inflation,the type that brought Hitler to power.(God spare us).
Senator Dominici saw the future when he said reducing the deficit to zero will cause problems and decided to agree with Greenscam that deficit zero in 6 years was too much-to-fast. (It risks out of control inflation)my words.An immediate tax cut at the lower levels and probably a tax gift to the poor will be necessary to stop defaults on credit cards and energy bills.A devalueation of the Dollar will take time to take effect especially if foreigners retaliate. (protectionism is sure to happin unless Europe goes on a Gold standard and US a Silver )Theres nothing new under the sun,just the history you don't know.
The founding fathers had it right the first time.
Hamilton knew Gold and Silver was real money.They all knew the TREASURY should control the money supply.(not some foreign banks)as Fed Reserve.The treasury should issue silver backed currency without any debt attached to it.This will drive fiat paper out of existance.The silver will now have to be purchased with the fiat paper,this will hasten its demise.Europe on a Gold standard,US,Mexico ,Canada on a Silver one .The Gold Silver ratio will allow some flexability in trade matters.
"Now it comes to, when someone can't make his point, he switches directions and practically calls me an agent of drug dealers. Jesus! This is the absolute worst hit I can take!!!!!!!!
What is next? Will he ask Stranger, are you some agent dealing drugs with your trading in and out of NEM? How about Randy, will you be profiled as moving opium out the back a pick up, using the trading profits from your gold trading? Is there no limit to this?
I guess it would not be so bad, but,,,,Why is it everyone here presents themselves as conservative and glad to get them people out of the White House,,,,,, then several of us goes on to ask Thaigold to further his logic as to how Giants are moving dope along the Trail???????
Good God!!!!, how do you think this reflects on me and others on this side of the screen?
Well, go ahead and jump to that boy's website and while you are at it let him explain how the gold world works! Let these guys explain the reasoning of international politics and money flows,,,,,,,, even let them explain the
"Thoughts of Another",,, I damn sure won't now,,,,
Because I wouldn't want any of you having your kids see their parents discussing gold on the internet with some outlaw like me!!!!!!!!!! The more I think about this the hotter I get!!!!!"
Sir Trail Guide:
I did not hear anybody suggest you work for "drug dealer's". I do not know if anybody here knows who you work for, most of us (believe it or not) really don't care, I always figured you worked for yourself (most giant's do, don't they?)
I appreciate your thoughts, I read them, keep them in mind. You are, after all, one of the better posters on this forum (imho). There are many good posters, and I appreciate them, also.
Btw, I don't consider myself to be a conservative, likewise, I don't consider myself to be liberal, hope I didn't give you the wrong impression. Most conservative/liberal (politicians) make my skin crawl. Clinton never did anything for me, likewise, neither did Bush.
I really think you are taking this a little too hard, but to each their own. I also think you were being a little harsh on ThaiGold and the Eagle Ranch. Keeping an "open mind", does not include burying your head in the sand (or just plain freaking out) when an uncomfortable subject comes up, ie: GOOP
Trail Guide: Count me among the many who want to read your posts!
I appreciate your time, effort, and willingness to share your thoughts with all of us. I look forward to reading your future posts.
Do not let the loose words of some dissuade you from further posting. I am the epitome of the "average guy" you referred to. I freely admit that much of what is discussed here has me scratching my head at times. I am very grateful to those who post in clear and concise language. Many people try to hide in the vaguery of word or written expression. These people I seldom give the time of day. They strive to have it both ways, their words give the impression they mean one thing...yet if it does not come to be...they claim that that was never their intent, their words were misconstrued.
There are some who post on this forum who seem to enjoy expressing their thoughts as if writing a petition to the court. They, in my opinion, do little to enlighten or guide thought....since they are obviously smitten with their weasle words. EVERYONE, for heavens sake, this is an open forum, drop the PRETENSE! It only serves to confuse and possibly piss people off!
in the company of their fellows, who count on their remaining gentlemanly, it seems to me an important thing that they extend their hands in fellowship and accept an offered hand for the sake of the company. Few are honored as we are today to be in such company.
And if an affront to the honor of a fellow Knight has been taken erroneously, then it should be all the easier to reconcile, shouldn't it? We owe it to all assembled on this journey to make that effort.
Sorry for not getting back to you all sooner. It's been a long
day, shovelling 18" of snow; 40 ft long; 8 ft wide. Just to have
a spot to park the pickup truck.
I've not yet had time to read all your posts. But I will, and you
can count on it. It appears I've stirred up a hornet's nest. It's
probably best, if everyone just calms down a bit. Some will
think I spent the day watching the SuperBowl. Not so. Bye the
way: Who won.?. and ...er... Whom did they play .?.
Meanwhile, here's an interesting news item (above link) from
today's (London) Telegraph website. To me, it illustrates how
corrupt things can get in the international finance arena. When
one man can cause the near-collapse of a whole country's
previously thriving economy. One man.!. Were this man, or
others of his bent, to set their sites upon the Gold market(s),
similar damage could be done.?. Or has already been done.?.
Think about it. Now, for the article, with my comment at the
top, between the lines. (I often write "between the lines"):
ThaiGold
===============================================================
Land of Smiles ... (When Deserved) ... Don't Tread on Thai's.?.
===============================================================
ISSUE 2075 Monday 29 January 2001
Soros under threat during Thailand visit
By Alex Spillius in Bangkok
THE international financier George Soros has received threats to his safety ahead of his visit to Thailand this week.
Many Thais still blame him for tipping the country into recession. Mr Soros and other currency speculators are said to have profited from attacks on the currencies of countries such as Thailand and Malaysia, causing the 1997 downturn.
Officials, academics and politicians have all criticised Mr Soros. Samak Sundaravej, the mayor of Bangkok, said: "Doesn't he feel ashamed, coming to see our misery which resulted from his sinister actions? He deserves a good bang on the head."
Numerous threats have been made on the internet against the Hungarian-born businessman and philanthropist. One message read: "If he dares come to Thailand, we cannot ensure his safety. This guy is bad. He caused us real hardship. The world will be better off without him."
Mr Soros admitted that "hedge funds like mine did play a role in the Asian currency turmoil". But he has not disclosed to what extent his Soros Fund Management was involved in the baht market.
23 December 2000: Soros faces insider dealing charge
5 May 2000: [City] Soros faces $3bn hit as managers quit
30 April 2000: [City] Soros served a slice of humble pie
14 August 1998: Soros sparks turmoil in world shares
4 August 1997: [City] Mahathir may take up Soros challenge
28 July 1997: [City] US defends Soros after attack by Malaysia's PM
3 July 1997: [City] Thailand fights to keep a grip on economy
Everyone on this Forum is either part of the USA economy or definitively affected by it. It is the size itself of the American GNP and infrastructure that is the source of the dollar being the global reserve currency. This recent boom of historical proportions has created an economic animal of gargantuan size and akin to a biological animal, it must be fed and maintained in order to survive.
Recently, I said I would build a case as to why this and successive interest rate cuts will not be inflationary. In embarking on this crusade, almost as an infidel against the established order, I find that the inter-connectivity of economic events expands far beyond the bandwidth of the largest of viable posts. So to the reminder from Robin "That's what they invented chapters for," here is #1
New Loans For Old.
A few weeks ago, I mentioned that we had been solicited by our recently acquired mortgage holder to re-finance at a lower rate. This is a large mortgage granted on the basis of an excellent credit record, an appraisal and two months of bank statements. That's it. Then in only six months they are asking to do it again and pay off any new unsecured credit debt to boot. Well we properly surmised that some lending body was well aware of impending interest rate cuts and seeking to lock in prevailing rates. Also, that the regulatory folks were still bending over backwards to make it easy for everyone to qualify. --- Why?
This economy has been brought to it's present size by unprecedented liquification of purchasing power and is now depended on that quantity to maintain it's existence. But, some of the factors that contributed to this growth are tapped out. The two most critical are the stock market wealth factor and the record amount of credit.
Over at the Hall of Fame (There's no such thing as money in the market) I've expounded at great length as to how one man's savings becomes only a perception while simultaneously becoming someone else's spending money. The fattening up of the economy through this via was facilitated by the easy money on gains taken and the perception of wealth in positions held. That easy money fed a purchasing frenzy and the perceived wealth made it easy to let go of any other discretionary income. Naturally, as the seemingly endless cycle of Buy low/Sell high came to an end, that impetus ceased to exist.
Simultaneously, the credit expansion having gone where no loans had gone before, tapped out at 125% mortgages and lending criteria that expanded to where there probably wasn't a sane underwriter left on earth. That flow too is no longer in play. Therefore: My view is that these flows must be replaced and that the lowering of interest rates will perform that function rather then expand or inflate the economy.
Consider: While all that raging hormonal spending power was feeding the beast we did not have rampant inflation. I have maintained that the exact cause of price inflation is the "power to command price" by whatever means that power can be obtained. The "Textbook" claim that this power derives from "too much money chasing too few goods" is simplistic, misleading and out of context to the whole.
Now, if ALL increased Money Supply were loaned to consumers to purchase EXISTING Goods that would be true. But economics is NOT a static event. Price direction will be determined by the net differential resulting from the effects of all outstanding supply and demand factors. This can be clearly visualized by looking at the mechanics of jet and rocket propulsion. The term "For every reaction their is an equal and opposite reaction" is a �law' of physics but does not describe the phenomena. When combustion take place in a chamber with a hole in it, there is equal pressure on all the surface of the chamber EXCEPT the hole. It is the pressure on all that surface that moves the chamber AWAY from the direction towards which the hole is facing, not the jet going out the hole.
So, a multiplicity of causes and effects are constantly in play and the resultant creates the price direction. What appears to happen is that a particular excess is observed to have taken place and is then assigned as the "Cause : of some phenomena that is synonymous to the excess. A perfect example is Mundell's claim that European money flooding into our stock market created our economic boom. (Europeans �invested "purchasing rights" are transferred to American stockhlders to spend.) Now, he may have concluded that without that inflow we wouldn't have had the boom but the boom was a result of the summation of �all' the factors. It was also created by the !00-125% mortgages, but those were not �the' cause either. If the Government had locked the doors of Microsoft and the economy crashed, would that have "Caused"it, or simply altered the balance enough to offset positive flows existent at that moment?
The Hyper-inflation of Germany took place in the environment of (as recently posted) "the banks extended their swollen deposits and bank notes almost entirely to small group of entrepreneurs ----for the most part the officers and directors of the cartels who frequently owned or controlled the banks themselves." Also, this was a domestic , not global economy and barely recovering from WWI. In this case, there was an extreme shortage of goods and productive capability to be "chased" by the expanding money quantity.
Fast forward to today and you see acres of manufactured homes, John Deeres, Caterpillers,--- Stuff! INVENTORY! Financed by debt and seeking consumers funds. We have a domestic and global PIPELINE filled with goods that can clamor for the dollars in the float. Even the exponential energy costs are mainly transferring purchasing rights from Walmart shoppers to Fuel suppliers; that is as long as every one keeps the job that enables them to service the debt.
The "Big Turkey" that can be targeted to keep Leviathan fed is the composite of holders of debt instruments. "New loans for old" may cut down on their spending but no production line shuts down unless in a market niche that is selective to that demograph..
In the above Mortgage situation the offered re-fi at a lower rate, as the early loan did also, would free up purchasing power for us and the paid-off lender would have to re-loan his funds at a lower rate of interest earnings. Given the principle is unchanged, no new money is created but we the producers are liquified and they, the interest owners have their belts tightened
A nation of tapped out debtors, asset rich and stressed to service debt would all benefit from Hyperinflation. However, Asher's third law of Ecodynamics states "Any activity that creates gain without production can empirically only benefit a minority.," Therefore in this current endemic situation, the ratio of buying power to available goods, necessary to inflate, cannot exist.
If the food-chain necessary to sustain this behemoth falters, then -- Contacted buying power, lot's of debt, no sales, need to raise cash, nation wide garage sale; =Deflation!
Waiter: "...and for you, sir?"
Uncle Sam: "We shall have the hyperinflation."
Waiter: "Sorry sir, we're out of the ingredients to make it."
Must FOA bear a personal attack on his integrity and motives simply because he disagreed with ThaiGold on silver, or with some other poster on gold futures and options? Does anyone really believe that's fair. I don't believe that anyone does, but that's the way it developed. Go back and read ThaiGold's posts and judge for yourself what was going on there. I have read what ThaiGold has posted the past few days and its not very pleasant or in keeping with the spirit we've carefully nurtured at this site. He not only broke the rules about self-promotion repeatedly well after receiving a warning, he went on to question FOA's integrity and motivations. He baited him until FOA reacted. No wonder FOA got angry. I would have too.
Another and FOA owe you, me and this Forum nothing, my friends. They aren't under contract. They can come and go as they please. They are here of their own free will and share with us as they choose. If some have missed the part of their message that stresses the proper diversification of assets then let me bring it to your attention because that is critical to the integrity of their message.
There is no way in the world the fate of anyone's portfolio (total asset structure) should hinge on the price of gold rising. If it does, that individual has learned nothing from me and the wiser heads at this Forum, particularly FOA and Another. If your portfolio does rest on the daily price of gold, you've over-committed. That may be a good move or a bad move -- but it has nothing whatsoever to do with FOA's message. If someone wants to speculate on gold options, then do so. I could care less, but don't try to make people believe it a true hedge against inflation, deflation, systemic risk, etc. If you do, then you are the one who misleads -- and primarily you are misleading yourself. As for Trail Guide, it is difficult for me to understand how an individual can be accused of hidden motives when all he is doing is recommending the standard gold diversification Swiss portfolio managers have been advocating for the past 200 years. If someone else wants to interpret that message as secular religion then that is their problem, not FOA's.
Let me go on:
Trail Guide's message on gold is not much different from my own documented in my book and in all my writings although he has elaborated significantly. He simply believes in a gold diversification. Everything else extends from that simple concept. Gold should be there to protect your family in the event that this paper money system blows up in our hands and takes our portfolios with it. If you assume a risk position (beyond a rational gold diversification) in gold stocks, options, futures, silver, platinum, etc. then you are no longer in a safe haven defensive position and the responsibility is purely yours and no one else's. There is nothing in Trail Guide's position that recommends it.
You are speculating, or investing if you prefer, and there's no facile manipulation of language and logic that will dispel the reality. All FOA and Another have tried to do consistently is keep people from trading one form of paper for another and trying to sell it to themselves as a diversification when it isn't. Some people -- particularly those who promote and/or own these paper and commodity plays -- resent that. They shouldn't. Physical gold simply goes in one column on the portfolio balance sheet. Paper gold in all of its manifestations goes in another. Commodity metals which rely on the vialbility of the economy and usage demand go in still another The former is a hedge. The latter two are speculations, or investments if you prefer the kinder description, and each has its specific uses in the portfolio.
In my analysis of the FOA/Another message, where they have a problem is when investors believe they have hedged a paper money meltdown by owning gold stocks, options, et al and they haven't -- they've simply assumed the same risks in another guise. I am not opposed to gold stock investments for example nor am I opposed to futures as long as people understand the risks and purposes and that they are a far cry from the underlying metal they purport to represent. FOA has said repeatedly that he owns gold stocks but views them as a risk investent and not a true safe haven like gold itself. And why is that so? Because gold is an asset that is neither someone else's liability nor does it rely on Another's performance for value (pun intended). There is nothing terribly new in this. It has been proffered by gold advocates, libertarians and free market economists for over a century now. Why so many refuse to even try to understand that simple concept is beyond me.
I have seen FOA and Another blamed unfairly for the mistakes of speculators for so often and so long that I wonder what they have to do to make their position plainer. To suggest otherwise is an insult to the high integrity they bring to this Table. I sometimes wonder why FOA continues to put up with what goes on here. I certainly wouldn't. I often wonder why he doesn't tell us all to take a Hike -- on our own -- and see if we can find our way out of the back country before the snow flies, or we get buried by an avalanche. But in such a case unfortunately he'd be throwing the baby out with the bath water and its plain he doesn't want to do that. There are many who appreciate the message and the depth of understanding he's brought her since this Forum opened. To his credit,I think he sticks around for them (us).
Perhaps the next time someone questions TG's motivations, you might want to also consider what it might be like if none who came here bothered to offer anything other than the ordinary point of view. I've seen TG's motives questioned time and again by people like ThaiGold who accuse others of an agenda and then go on with pushing their own scheme -- their own personal agenda. Let me say, that I've never had to worry about FOA pushing a personal agenda, pointing people to his own website and the rest of the nonsense we have to put up with around here.
What if I questioned the motives of everyone who posted here:
Oro, what's your motive? Why do you post here?
Holtzman, what's your motive?
Journeyman, what's your motive?
Farfel, your motive please.
Mr. Gresham?
Peter Asher?
ET?
Beesting?
Need I go on??? Perhaps we should put that on the registration form and see how people answer. (By the way, I don't really want to know the above's motivations.)
I wanted to pull ThaiGold's code a few days ago for his self-promotion, but we decided to send him a warning instead. Not the first mistake I made trying to manage this Forum. Now it's going to look like we bounced him because of FOA. Let me just say that he was on a one way ride out of here long before this blow-up. If I let him promote his site, then what ammunition do I have for every other self promoter who wants to use this Forum for his or her own commercial or personal agenda? Now or in the future. I'm really not interested in spawning competitors. Not on my dime anyway. We do not sell advertising to this site. We try to keep it efficient, friendly and useful. I wish all who came here would take a cue for that without having to traverse these ugly troughs that are becoming all too frequent.
Enough on this subject. I just hope FOA decides to continue here. There's not doubt in mind about the value of his thinking -- misunderstood as it sometimes is. Anyone can interpret any message as they wish and bend it to their own purposes -- or to justify their own actions, good or bad. It takes a higher order of intelligence to put aside your own prejudices and motivations in order to understand the real message. One wonders how many great thinkers have dealt with similar problems as they saw the power of their hard-won message put to ill use.
Klintons lawyer Quinn might suffer a unfortunate accident before Dick Morris will.Morris has the good sense to keep his face in a public place where all can see him (tv).
Why arn't press the calling for Hillarys resignation for moral turpitude (payoffs,bribes,conspiricy,(Rico Act)etc.Conspiricy to aid and abet the President in his crimes.Do females get a free pass?
The Wiz's "Motives" --- Why am I at the USAGOLD Forum ?
#1) To learn and be able to ask questions of what I do not understand;
#2) To be in the comradeship of people far more brilliant than myself to broaden my understanding;
#3) To determine MYSELF, how to make the world better for myself and my family, during the remainer of my lifetime.
THESE are the Motives of the Wiz for having "stuck" in his daily chair at the TableRound, throughout the many "foodfights" and "hatchet jobs" that all have endured.
I too shall be sad if FOA and ANOTHER are forced to stop the teachings of the GIANTS.
<;-)
PS: MK, I know that you said that you really did not wish to know the MOTIVES, but I could not let this go by without my comments.
Did Greenscam go short against the box?Is thats whats going on ?Did England and the other sellers get assurances from Greenscam to get thier Gold replaced.Is this how he supports the Dollar?In the mean time who's paying the lease rate?Speak Mr Treas. Sec.
We have come a long way from humble beginnings, haven't we my friend. You were among the original handful of posters. And I still remember the e-mail advice at critical junctures -- always well thought out; always well-received. At times it took the advice of a wizard. I don't forget, my wizardrous friend. Where have you been lately? And where is Goldfly? Remember "Spot"? (Smile).
I was just about to go "Ballistic", [actually i did] when i finished reading about the attacks on F.O.A.
This site is USAGOLD not "USAOPIUM" or "USASILVER"
I've always found Thaigolds posts strange and completely stopped reading them, and even my antenna went up, when i saw him promote his "website"???
So i,am so very happy that he is gone,because my opinion was to "NUKE,EM" for King and Country!
How Glorious to see that M.K does have a very big Golden Backbone!!!!!!! Thankyou, Thankyou for being a real person!! Mr M.K.
Are you listening F.O.A (Big stupid GRIN :-}}}}}}})
P.S please don't leave F.O.A :-(
Ya just never know. I found this list of Clinton acquaintences who have had met with an untimely demise. Being a friend of Clinton could mean a short life span. Coincidence? Hmmmm...
- Black Blade
Charles Ruff, parapalegic White House counsel who slipped in the bath tub and died of natural causes, one day after being ordered by Judge Royce Lambert to testify in the Northrop Grumann e-mail contractor diversion/erasure case. He was the council to the President who represented him in the Impeachment trial before congress.
James McDougal - Clinton's convicted Whitewater partner died of an apparent heart attack, while in solitary confinement. He was a key witness in Ken Starr's investigation.
Mary Mahoney - A former White House intern was murdered July 1997 at a Starbucks Coffee Shop in Georgetown. The murder happened just after she was to go public with her story of sexual harassment in the White House.
Vince Foster - Former white House counselor, and colleague of Hillary Clinton at Little Rock's Rose law firm. Died of a gunshot wound to the head, ruled a suicide.
Ron Brown - Secretary of Commerce and former DNC Chairman. Reported to have died by impact in a plane crash. A pathologist close to the investigation reported that there was a hole in the top of Brown's skull resembling a 45 caliber gunshot wound. At the time of his death Brown was being investigated, and spoke publicly of his willingness to cut a deal with prosecutors.
C. Victor Raiser II & Montgomery Raiser - Major players in the Clinton fund raising organization died in a private plane crash in July 1992.
Paul Tulley - Democratic National Committee Political. Director found dead in a hotel room in Littl Rock,
September 1992. Described by Clinton as a "Dear friend and trusted advisor".
Ed Willey - Clinton fund raiser, found dead November 1993 deep in the woods in Virginia of a gunshot wound to the head. Ruled a suicide. Ed Willey died on the same day his wife Kathleen Willey claimed Bill Clinton groped her in the oval office in the White House. Ed Willey was involved in several Clinton fund raising events.
Jerry Parks - Head of Clinton's gubernatorial security team in Little Rock. Gunned down in his car at a deserted intersection outside Little Rock. Park's son said his father was building a dossier on Clinton. He allegedly threatened to reveal this information. After he died the files were mysteriously removed from his house.
James Bunch - Died from a gunshot suicide. It was reported that he had a "Black Book" of people containing names of influential people who visited prostitutes in Texas and Kansas.
James Wilson - Was found dead in May 1993 from an apparent hanging suicide. He was reported to have ties to Whitewater.
Kathy Ferguson - Ex-wife of Arkansas Trooper Danny Ferguson died in May 1994 was found dead in her living room with a gunshot to her head. It was ruled a suicide even though there were several packed suitcases, as if she was going somewhere. Danny Ferguson was a co-defendant along with Bill Clinton in the Paula Jones lawsuit. Kathy Ferguson was a possible corroborating witness for Paula Jones.
Bill Shelton - Arkansas state Trooper and fiancee of Kathy Ferguson. Critical of the suicide ruling of his fiancee, he was found dead in June, 1994 of a gunshot wound also ruled a suicide at the gravesite of his
fiancee.
Gandy Baugh - Attorney for Clinton friend Dan Lassater died by jumping out a window of a tall building January, 1994. His client was a convicted drug distributor.
Florence Martin - Accountant sub-contractor for the CIA related to the Barry Seal Mena Airport drug smuggling case. Died of three gunshot wounds.
Suzanne Coleman - Reportedly had an affair with Clinton when he was Arkansas Attorney General. Died of a gunshot wound to the back of the head, ruled a suicide. She was pregnant at the time of her death.
Paula Grober - Clinton's speech interpreter for the deaf from 1978 until her death December 9,1992. She died in a one car accident.
Danny Casolaro - Investigative reporter. Investigating Mena Airport and Arkansas Development Finance Authority. He slit his wrists, apparent suicide in the middle of his investigation.
Paul Wilcher - Attorney investigating corruption at Mena Airport with Casolaro and the 1980 "October Surprise" was found dead on a toilet June 22, 1993 in his Washington DC apartment. Had delivered a report to Janet Reno 3 weeks before his death.
Jon Parnell Walker - Whitewater investigator for Resolution Trust Corp. Jumped to his death from his Arlington, Virginia apartment balcony August 15, 1993 Was investigating Morgan Guarantee scandal.
Barbara Wise - Commerce Department staffer. Worked closely with Ron Brown and John Huang. Cause of death unknown. Died November 29, 1996. Her bruised nude body was found locked in her office at the
Department of Commerce.
Charles Meissner - Assistant Secretary of Commerce who gave John Huang special security clearance, died
shortly thereafter in a small plane crash.
Dr. Stanley Heard - Chairman of the National Chiropractic Health Care Advisory Committee died with his
attorney Steve Dickson in a small plane crash. Dr. Heard, in addition to serving on Clinton's advisory council
personally treated Clinton's mother, stepfather and brother.
Barry Seal - Drug running pilot out of Mena Arkansas, Death was no accident.
Johnny Lawhorn Jr. - Mechanic, found a check made out to Clinton in the trunk of a car left in his repair shop. Died when his car hit a utility pole.
Stanley Huggins - Suicide. Investigated Madison Guarantee. His report was never released.
Hershell Friday - Attorney and Clinton fund raiser died March 1, 1994 when his plane exploded.
Kevin Ives & Don Henry - Known as "The boys on the track" case. Reports say the boys may have stumbled upon the Mena Arkansas airport drug operation. Controversial case where initial report of death was due to falling asleep on railroad track. Later reports claim the 2 boys had been slain before being placed on the tracks. Many linked to the case died before their testimony could come before a Grand Jury.
THE FOLLOWING SIX PERSONS HAD INFORMATION ON THE IVES / HENRY CASE:
Keith Coney - Died when his motorcycle slammed into the back of a truck July, 1988
Keith McMaskle - Stabbed 113 times in Nov, 1988
Gregory Collins - Died from a gunshot wound January 1989.
Jeff Rhodes - He was shot, mutilated and found burned in a trash dump in April 1989.
James Milan - Found decapitated. Coroner ruled death due to natural causes.
Jordan Kettleson - Was found shot to death in the front seat of his pickup truck in June 1990.
Richard Winters - Was a suspect in the Ives / Henry deaths. Was killed in a set-up robbery July 1989.
THE FOLLOWING CLINTON BODYGUARDS ARE DEAD
- Major William S. Barkley Jr.
- Captain Scott J. Reynolds
- Sgt. Brian Hanley
- Sgt. Tim Sabel
- Major General William Robertson
- Col. William Densberger
- Col. Robert Kelly
- Spec. Gary Rhodes
- Steve Willis
- Robert Williams
- Conway LeBleu
- Todd McKeehan
BlackBlade, and all - Getting the messsage (All, take heed)
Now you have some idea why you will never 'get' the manipulators. Those that really know the 'Power of Gold', not as told by Bernstein, and other smoke screen writers.
This is nowhere near as long as that which records similarly 'untimely and strange deaths of those involved in the Kennedy assassination.
This is going on all the time.
It is not only key witnesses who are eliminated but those not recorded who are scared enough to keep quiet. They got the message.
I never wanted to go into academia because of all I'd heard about department politics, and all the backstabbing and nastiness among people who are supposed to (1) love learning and their subjects, and (2) do the job of imparting that to the paying students. I'd really feel trapped in that scene.
I'd much rather learn and share in a FREE environment like this one. But it still takes work, and some rules.
At the same time, I'm getting images of us all on a troop transport heading for Omaha Beach in 1944, and we've got some tough sargents, a few green officers, a brilliant colonel, and the usual bad-talking movie wise-guy from Brooklyn who makes everyone wonder which way they should be pointing their rifle.
Soon enough we'll land, and we'll already have a good idea who we can trust under fire to watch our backs (bring in the info & analysis we need, and answer our questions.)
Entropy is the rule throughout most of the Internet sites. Little stands out above the mush as quality, because only people working together can make the real quality. When they do it consistently and as volunteers, you know they've found a good thing. Without trust, they won't stick together. Period. Lose the trust, and entropy wins. You're back in the mush.
There are ways to bring up controversial questions the unit ought to consider. But that's why you look to motives. When you see someone working hard for the unit, that's a pretty good indicator, since no one here gets a paycheck (well, maybe Randy, but he goes way beyond the obligations of a job in giving his best here).
This is to say that Michael could make the standards even tougher, and he'd be justified. Because if you're not working to make the place better (and that includes having fun together), then you're something of a free rider, on which there's gotta be a limit. I've seen it before many places, and you probably have, too. (I also remember some trolls attacking the Y2k sites, in part because they just couldn't stand to see people enjoy themselves so much together!)
There are a few who work so hard to give us good stuff, that a cynic might be overwhelmed and say there's gotta be a catch, an agenda. Maybe that's what happens. (It's too bad that head and shoulders out of the foxhole makes you a target, sometimes from both directions! Hazards of war?) But I would have to say I'm sorry for that person because he's probably never known how satisfying it can be to be part of a good thing and make your own contribution to it.
If I didn't know better, given the mathematical improbability of so many dead people surrounding the Clintons, it would seem like more than just a coincidence.
NAHHH!
And you know whats so ironic, is that so many women, and liberals who are against the death penalty actually thought these two scoundrels were the cats' meow. Well, they brought more sexual harrasment and death (in that order) than any husband/wife team ever brought to the Whitehouse.
To see them as they really are, really has to make one sick.
Good thing that we dreamers here at stopped-clock-dot-com are not taken seriously by the mainstream, otherwise we would be hunted for saying these things. But we are just a bunch of wackos from the vast right-wing conspiracy, so we can continue to utter the unmentionable things without fear of retribution.
While we are at it, lets not forget to mention that there are deaths of foreigners, used to perpetuate the world wide balance of power, or maintenance of the status quo, who have died in wars such as Vietnam, WW2, (The NON-SURPRISE attack on Pearl Harbor was the excuse needed to get the public to not protest the first atomic test on humans at Hiroshima and Nagasaki), etc, etc, etc. So there are crimes done by high powers in offices world wide, that sacrifice the innocent for the pleasure/needs of the elite, or the "better good" of mankind.
Are Clintons' crimes less severe? Well, in terms of numbers, yes. Does the 30 or so "Clinton Dead" pale in comparison to the thousands lost in sh*tty little wars? Yes, there are far less Clinton Dead than the dead from political manuvering by the US overseas.
So why are the Clinton Dead such a big deal in the overall scheme of things? Because they are committed with such brazen unrepentant smugness, by such transparent kaniving thugs, in the broad daylight of the public eye, and there has been no presidency that has such a long list of abuses, perversion, criminal dealings, selling out to the Chinese, and murders, and no administration has so tainted the image and reputation of the highest office of the United States.
There have been Presidents who have had affairs before. Jefferson, Kennedy.
There have been Presidents who have been for sale before. I remember vaguely an article about Bush Sr. and his dealings with some big defense contractor, or something. And we dont need to pretend that there haven't been others.
There have been Presidents who have contracted hits before. (albeit with more finesse than the Arkansas "mafia", who use machetes and baseball bats, instead of the cia with their heart-attack-simulating drugs) Ah, c'mon, I can hear someone out there who doesn't think a President would do something like this. OK, I'll buy you a ticket to Disneyland, and you can have fun on the tea-cup ride with Mickey, while we continue to discuss these issues, ok?
But I dont think there has ever been a Presidency who has committed such obvious, perverted crimes, and who has covered them up in such a violent brutal fashion, even to the point of having to murder everyone who has any knowledge of the skeletons in the closet, and never has a President who has been such a sellout to a foreign power, and a communist one at that, (isn't that treason, punishable by hanging?)
If you consider the whole of the last eight years, it makes one shudder at the absolute baseness and crudity of the wicked duo at the helm. I think they have cockroaches running around in their brains, telling them what to do next.
HOUSTON (Reuters) - Oilmen have always been fond of telling the rest of us that all the easy oil and gas was found long ago and that it takes increasing amounts of cunning and hard work to persuade the Earth to give up additional hydrocarbons. It's a truism perhaps nowhere more evident than in the United States, where the industry has been scouring the landscape for a century and a half in search of profitable drilling prospects. Despite the incentive of historically high oil and natural gas prices, a shortage of readily drillable targets has constrained U.S. domestic oil and gas production and left it increasingly reliant on foreign supply. Waning domestic supply has spurred the new Bush administration to push for opening federal lands, including the northern coastal plain of the Arctic National Wildlife Refuge (ANWR), to eager oil drillers. Simmons & Co. energy analyst Mark Meyer notes that U.S. oil production by 21 of the biggest publicly traded companies fell more than 5 percent in the first nine months of 2000 while the same companies' U.S. gas production fell 0.7 percent. ``There's not a lot of sweetspot easy-gets any more,'' Meyer said. Jeff Kieburtz, an analyst with Salomon Smith Barney, says the aging of the world's oil and gas reservoirs is pushing global exploration efforts into more remote areas, especially deepwater offshore plays such as the Gulf of Mexico. ``Most of the land and shallow-water basins in this country are fairly well understood, so that new drilling prospects tend to be step-out type of drilling ideas rather than entirely new structures,'' Kieburtz said. "Deepwater is where the real pure exploration activity is going on in this country,'' he said.
SQUEEZING MORE OUT OF OLD FIELDS
The U.S. Minerals Management Service recently reported that the number of rigs drilling in water depths of 1,000 feet or greater in the Gulf of Mexico rose to a record 40 at the end of last year from 26 a year earlier. That total included seven rigs working in ``ultradeep water'' of 5,000 feet or more and three that were pushing the frontiers of offshore exploration in more than 7,500 feet of water. Back on land, so-called enhanced recovery techniques are being used to squeeze more oil and gas out of mature fields. Marathon Oil Co. and Kinder Morgan Energy Partners recently formed a joint venture that will inject carbon dioxide deep into the ground to boost production from the historic Yates field in West Texas that was discovered in 1926. Meyer said relatively complex enhanced recovery technology was even being deployed from the startup of Phillips Petroleum Co's Alpine field in Alaska, the biggest U.S. onshore oil discovery in more than a decade. Alpine, discovered in 1994, contains estimated recoverable reserves of 429 million barrels of oil. Production began in November, using a mixture of gas and liquids to extract oil from the rock that holds it. Meyer contrasted Alpine with the big discoveries of the past which first underwent a long phase of primary production, making use of the field's natural pressure. Later, they were flooded with water to prolong production and only toward the end of their life would more complex ``tertiary'' recovery techniques be deployed. Phillips is also taking pains to protect Alaska's delicate tundra and wildlife, minimizing environmental impact by cramming surface production facilities for the 40,000-acre field into just 94 acres and using temporary ice roads and air transportation to move people and supplies, rather than building a new road.
DRILLING DEEPER WELLS
In North Texas, Mitchell Energy & Development Corp. has boosted its production of natural gas from a field that it has been working since the 1950s by pumping in a mixture of sand and water to crack open the tough Barnett Shale formation. Meyer said that in the near to middle term deeper wells will have to meet growing U.S. demand for natural gas. Deeper wells hold out the prospect of much bigger reserves, but they are more expensive to drill and the risk of failure is much higher. This month Burlington Resources Inc. completed a well in Wyoming that it drilled to 25,855 feet. It is currently conducting tests to determine if it contains sufficient reserves to warrant development and production. By contrast, wells drilled in Texas in recent years have had an average depth of just over 6,600 feet. With the new administration of President Bush taking over in Washington, the U.S. oil and gas industry is hoping for a more sympathetic response to its calls to open up more federal land to exploration drilling. Conoco Inc.'s top exploration and production executive, Rob McKee, has noted that the Rocky Mountains alone are estimated to contain 137 trillion cubic feet of natural gas, equivalent to six times current U.S. annual consumption. Meyer said the change of administration could help the industry but that he did not anticipate a swift breakthrough in the political tug-of-war between economic and environmental interests when it came to opening up public lands to drilling. In the meantime, as the major oil companies and larger independents shift their investment focus toward international and deepwater prospects, technologies such as time-lapsed 3D seismic surveying can enable smaller independents to prolong the life of mature fields and earn money as they do so. ``From a public policy point of view, it won't cut dependence on imported oil, but for individual companies it makes sense,'' Kieburtz of Salomon Smith Barney said.
Black Blade: Very good article. This describes what I outlined in the "The Rise and Fall of Hydro-Carbon Man." The "Super-Giants" have all been found and are in various states of decline, and the more expensive and non-conventional oil is left. Prices will rise. In the meantime, NG which can't be imported (at low cost) will be the key to this current energy crisis. The economy is beginning to crack under the pressure of higher energy costs. I could go on ad naseum, however, a reread of the Hydro-carbon Man post should cover it very well. A repeat of the 1970's economic bust? Could very well be.
http://biz.yahoo.com/rb/010128/j.html By James Jelter
SAN FRANCISCO (Reuters) - While California's rolling blackouts grab national headlines, the threat of a severe electricity shortage is also fraying nerves and demanding prompt action in neighboring Oregon and Washington.
``The demand for energy has far outgrown supply. It is just as true in the Northwest as it is in California,'' said John Harrison, a spokesman for the Portland, Oregon-based Northwest Power Planning Commission (NWPPC).
``We're all on the knife's edge. If we have severe weather, which for us means a cold, dry winter, we're in trouble. It's a very precarious balance.'' Though most acute in California, the entire region is suffering from the same energy malaise: Rapidly growing populations and robust, computer-driven economies combining to overwhelm what aging local power plants can provide. Electricity demand throughout the western states has grown by 12,000 megawatts over the past decade, or roughly the amount of energy needed at any given instant to light up 12 million homes.
During that period, only 3,000 megawatts of new generation has been built in the region, shaving to the bone whatever power reserves existed there 10 years ago.
DROUGHT, HEAVY CONSUMPTION DRAIN SUPPLIES
The shortfall is especially critical in the Northwest, where a severe drought and heavy power consumption have drawn down rivers feeding hydroelectric dams that during a normal year would generate 75 percent of the region's power. Most of that electricity comes from water tumbling toward the Pacific through 31 federal dams managed by the Bonneville Power Administration (BPA), based in Portland, Oregon. This year, the reservoir behind Grand Coulee, the system's and the nation's biggest dam, is at a 25-year low, the result of rain and snowfall at only 52 percent of normal amounts. The remaining mix of Northwest power plants, fueled mostly by coal and natural gas, cannot close the gap. The Northwest rivers, low as they might be, are nevertheless being tapped almost routinely to provide emergency power for California's 34 million residents, some of whom have twice this month seen their power literally run out. However, California's power woes are benefiting the Northwest and could help it stretch its hydro supplies a bit farther through the summer. Back in November, when California first started crying for help, a deal was struck in which California would send two megawatts of power north for every megawatt that was sent south. BPA officials call the swap a ``win-win'' situation, providing desperately needed hydroelectricity to California during the state's peak demand hours during the daytime. Then at night, when the much chillier Northwest most needs electricity for home heating, California reverses the flow, sending power north and enabling BPA to shut the gates on its dams, holding back water and refilling the reservoirs. ``Before, the flow of power was from the Southwest to the Northwest in the winter months and from the Northwest to the Southwest during the summer, when they need it to meet air conditioning loads,'' said BPA spokeswoman Dulcy Mahar. ``Today, we don't have any surplus power, so we've come up with this unique plan, accelerating what used to be a seasonal pattern and making it daily or even hourly.'' Mahar said the arrangement so far has helped BPA raise the giant Lake Roosevelt reservoir behind Grand Coulee one foot (30 cm), saving enough water to generate the same amount of power it would take a big nuclear plant 10 days to produce.
SEARCH FOR NEW SOURCES
Nevertheless, the Northwest's heavy reliance on hydropower is wearing thin. No new dams have been built there for 25 years and, given environmental concerns, none is likely to be built any time soon. Washington Gov. Gary Locke last week called for steps to diversify the state's energy portfolio, weaning its nearly 6 million residents from what he warns is an overdependence on hydropower. Meanwhile, scant supplies and strong demand have pushed wholesale power prices to 10 times their year-ago levels. Much of the electricity sold in Oregon and Washington comes from municipal power companies forced to pay top dollar on the wholesale market to secure enough power for their customers. The result is a rise in electricity bills of anywhere from 20 to 80 percent, infuriating consumers and lawmakers alike. To put a clamp on the runaway market, Gov. Locke, Oregon Gov. John Kitzhaber, and California Gov. Gray Davis earlier this month stood together and demanded the U.S. government impose a region-wide cap on wholesale power prices. The request has so far been turned down, with newly elected President George W. Bush and Energy Secretary Spencer Abraham arguing that the laws of the marketplace, not price controls, will lead to the best long-term solution to the problem.
SQUARING OFF
That has not dented the governors' convictions that the situation is so dire, and poses such a huge threat to the region's overall welfare, that a price cap is called for. The issue will be at the center of talks set for Feb. 1 in Portland, where governors Locke and Kitzhaber will meet with secretary Abraham and other top federal energy officials to map out a strategy to ease the enormous strain on the western power grid and bring prices back down to earth. None of those attending next Thursday's meeting pretend to possess a magic wand that can ease the crisis, and utility industry analysts warn solving the basic supply-demand dilemma could take another two to three years.
Meanwhile, they warn the blackouts that rolled across parts of California this month could easily spread north this summer, when air conditioning demand hits its annual peak in the Southwest, leaving precious few megawatts to go around.
Black Blade: It's going to get much much much worse! No one has prepared for this obvious outcome. They had nearly 30 years to prepare and they did nothing but hide their heads in the sand and pretend that "all's well." Well now the "chickens have come home to roost!" Cheeta (AG) was right about one thing in his recent testimony � they had better start to drill more NG. Only problem is � there are no available drill rigs! This collision of events ("The Perfect Storm") has only just started, first in Kalifornia and now it is spreading like wildfire. No one wanted to take the first step and prepare. The Y2K crowd should be in better shape if these events lead to economic collapse, power failures, societal breakdown, etc. The rest of the Grasshoppers have no excuse to complain. "And they danced, sang, and played all summer�"
LANSING, Mich. (AP) - Soaring energy bills are eating deeply into the budgets of schools, hospitals, churches and homeless shelters across the country, forcing them to look for increasingly hard-to-find ways to tighten their belts.
``It will come out of the hides, so to speak, of the kids,'' says Don Tharpe of the Association of School Business Officials. Unlike businesses, he notes, schools can't raise the prices on their product to make up for higher costs.
MEDICAL COSTS LIKELY TO RISE AND THE PLATE WILL BE PASSED MORE OFTEN
Many hospitals need to pass their heating costs along to patients, although that's not always possible because hospitals get fixed reimbursements from Medicaid and Medicare for many patients, said George Quinn, a spokesman for the Wisconsin Health and Hospital Association. ``If your costs go above what you budgeted, you aren't able to recoup that from government payers, so there will be some passing along to patients who can pay,'' he said. ``It has to come from somewhere.'' Gas companies blame the prices they are charging on the cost of wholesale natural gas, which has quadrupled over the last year. High demand intensified by cold weather has contributed to the problem. The leap in natural gas prices coupled with a shortage of hydroelectric power in the Northwest also has contributed to California's energy crisis. The high price of energy doesn't leave much to go around for anyone. ``Just today, someone told me a chair broke, but we're not going to go out and buy another chair. We just can't be spending money on things like that,'' said David Williams, operations director at the Michigan Humane Society, whose cost to keep animal shelters warm is approaching $4,600 a month. There are blankets on the pews for worshippers at Dimondale United Methodist Church near Lansing. Like many churches, Dimondale heats the sanctuary only for services. But it still pays $600 per month for heat, Pastor Lillian French said. ``That's $600 out of an already tight ministry,'' she said. Lansing's Sparrow Hospital will spend an estimated $140,805 on January's heating bill, up from $32,940 in January 2000, spokeswoman Lorri Rishar said. The hospital has few ways to trim that bill, Rishar says. Specialized areas such as nurseries must be kept at higher temperatures, for example. So far, the hospital is absorbing the cost with emergency funds and hasn't had to pass it along to patients, Rishar says. ``We're just hoping it warms up the rest of the winter,'' she added. Abbott Northwestern Hospital in Minneapolis paid $71,000 for natural gas heat last January, said Bob Hallman, maintenance manager for the 580-bed hospital. This January, he said, the hospital switched to its backup oil heating system and saved about $120,000 - but will still pay nearly $140,000 for heat. ``I don't know that anybody saw it coming. I certainly didn't budget for these types of dollars,'' Hallman said. Schools also need to maintain a warm environment. Just north of the Colorado-New Mexico state line, Trinidad's School District 1 says it may have to cut student programs. This winter's heating bills are $25,000 to $30,000 higher per month than the budget for the 1,600-student district allowed, Superintendent David VanSant said. Many homeless shelters in Massachusetts are limiting food and other basic provisions because heating costs are so high, said Philip Mangano, executive director of the 75-member Massachusetts Housing and Shelter Alliance. Heat just isn't one of the things that can be sacrificed, Mangano said. ``For very vulnerable people, the feeling of safety and security is often tied up with the notion of warmth,'' he said. ``Keeping the environment warm for the temporarily lodged is a very important part of the service that's provided.'' Sister Connie Driscoll knows that all too well. She leads the Chicago Task Force on Homelessness and runs a shelter for 120 women and children on the city's South Side. She has paid a fixed price for heat under an agreement with her local parish, but already has been warned that the price will skyrocket when she renegotiates this summer. ``We're all sitting on pins and needles wondering what's going to hit us,'' she said.
Black Blade: Sorry, I added the inserted headline for emphasis. The message is clear, despite there being dubious statistical trickery such as "Hedonic Deflators/Pricing" and "Seasonality", and Core-Rates, etc. the message is quite clear � inflation is higher � much higher, and it is only disguised through trickery and deception. What is the true inflation rate? I don't know, but I have read that it could be anywhere from 5% to 11%. Who knows? What ever it is, the costs will be passed on to us.
Clinton, himself, would not have been party to any of those mysterious demises. Clinton was a fool, and a tool ( in more ways than one), but, I feel certain, not a murderer.
In the earlier days of his career, he would have been earmarked from his character weaknesses � philandering etc., (as are others), and his aspirations, as being a perfect �stooge� to be put in the right place, at the right time to help put forward the agenda of the US's real �government� � the one they don't get to elect. TPTD need a person they have a hold on, NOT a man of integrity.
This way, Clinton gets all the stick, and the real �dark forces� remain in the shadows, to carry on their machinations and murky ways with a replacement tool � of which there is always a suitable supply, waiting in line.
You can rest assured that Clinton knew the score. If he had not appointed the people to the high offices of government, that he had been told to appoint, or put forward the policies he had been told to , he knew what would have happened to him. Clinton merely went along for �the ride� � again in more ways than one.
(Do you think, for one moment, that Lewinsky just happened to be working at the White House�? Was it just a chance affair? Then you are more na�ve than you realize).
Bush is a different guy (tool), but all it means is � different strokes for different folks. It will be made to appear that big changes have, been made � you can't overdo one direction. Therefore, other parts of the agenda will be pushed forward during Bush's reign. But there will be a few sweeteners, no doubt, thrown to the gullible US public.
So don't castigate Clinton � pity him. He is just another poor weak mortal who sold his soul to the devil. As you can see, from his deteriorating appearance, he is paying the price of a man who would be king (or who would have appeared to be).
IN DEFENCE OF CHINA, AND ALL THE. US NOMINATED. 'PARIAHS'OF THIS WORLD.
I read so often buried within comments made by posters, about America 'selling out' to the Chinese, or some other ant-Chinese comment
When the Germans were defeated, it was - 'now who will be the enemy'. So the US came up with Russia - right from being our friend and ally.
I am no communist, or any other 'ist', but I read influential writers and supporters of various ideologies.
Marx, and later Russian leaders, said that Western capitalism, and not communism, NEEDED wars for its survival.
Yes, there were many shortcomings, of Russian style communism, but they might not have been so bad had Russia not been forced to divert vital resources to maintaining a huge war machine. Their forced switch to Western style capitalism has not fared them better - the poor are far worse off, and crime, and social disorder, is rampant.
When Japan appeared an economic threat (before Soros, TPTB 'panzer division'struck) there was a strong anti-Japanese feeling unleashed by the media.
Then came Iraq - a country that had been supported by the US while it served to hit another perceived US enemy - Iran.
Overnight almost, when Saddam's popularity was spreading in the Arab world ( among the mass of Arabs not their puppet leaders), and could have posed a threat to Israel's domination of the Middle East, he became public enemy No 1.
By tricking him into thinking he could retake Kuwait (once part of Iraq until we carved up the area) and that there would be rhetoric but no 'physical interference', he gave the US the opportunity to turn the naive world against him.
He was foolish in not seeing that Galtieri in Argentina had been so similarly tricked just a few years earlier, with the Falklands.
And so it goes on. While the TPTB through the US can keep the world destabilised, and in economic turmoil, it allows them to progress their agenda and to strangle the economies of any country that offers resistance or poses a potential threat.
Now, the only major threat is China. So she is very subtly being fed to a gullible US public as a pariah, an evil force that is out to destroy America and the 'free' world.
When, in actual fact, it is just the opposite. China has far more to fear from the West, than the West from China. That is the future, that is now, and THAT IS HOW IT ALWAYS HAS BEEN ( Read your history).
I would like to make clear, it is not the US per se, or the American people who create, or foster, the problems of this world, but the certain people who 'use' her for their own selfish aims.
But for them, America, and its people, would be among the world's most loved,and would have served as a role model that the rest would have wanted to follow, for all the good reasons.
California's energy troubles may have a silver lining for resource stocks. Every state adjacent to California is being sucked into the crisis with power being diverted to keep consumers warm but disrupting mining operations from New Mexico to British Columbia. While mining types are usually the last to see good fortune in such circumstances, this case is different.
Resource firms reselling contracted power are sitting in the pound seats. Kaiser Aluminium was the first to see the opportunity, followed by Alcoa, in shutting down potlines throughout the Pacific Northwest where spot electricity prices rocketed 5,000% in response to supply shortages. Columbia Falls Aluminum is the latest to join the arbitrage craze, closing its 85,000 tonne Montana smelter for the whole year.
The crisis is rippling all along the western seaboard, inland to the Rockies and crashing international borders. Zinc producer Cominco is reducing production at its hydro-powered Trail plant in British Columbia and will terminate Metallurgical Operations in August and September 2001 in order to resell 156 Mw to the grid.
Of course, the good fortune doesn't extend to everyone. Not all resource companies affected by the crisis can resell their energy and they're watching in horror as costs soar beyond breakeven.
Phelps Dodge drove home the impact of California's power shortages this week when it released its annual results. Chairman Steven Whisler was beside himself about the profit-sapping crisis that has raised energy costs 62% per pound of copper produced. The firm lost its diesel supplies when power to the pipeline was siphoned away for California's consumers. Whisler's colleagues in regional airline and railroad companies are just as fretful, preparing to cut services and fearing the confiscation of their electricity.
Over 2,000 Phelps employees stand to lose their jobs if the shortages persist, further damaging the already hard hit West. Montana Resources closed its Continental copper mine after prices per megawatt hour surged 1,600%. Homestake Mining has had electricity to the McLaughlin gold mine interrupted; raising costs $10 an ounce.
Resource sector analysts will no doubt be reaching for their calculators in order to rejig market estimates for a range of metals and minerals, especially copper, gold and aluminum. They'll be spending plenty of time trying to figure out how to classify and quantify the earnings of resource extractors turned commodity traders. Resource stock fundamentals as we know them will count less this year than at any time in the last decade and will make prognostication a dangerous art in 2002.
The head scratching will be particularly vigorous if the crisis sweeps over the western gold majors as it is bound to. That could mean a double bonus for gold investors. World supply would be more seriously affected than it has been in years which could drive the gold price higher. Secondly, companies with earnings unfettered by production costs could be a real sweetener to any portfolio.
For miners, stand down time would be welcome liberation from the treadmill of operational expectations. Mine plans can be reviewed at leisure and equipment can be maintained the way the labels say it should be. Staff would enjoy an epic holiday, returning rejuvenated and more productive.
Indeed, some miners may be tempted to encourage California to screw things up more than it already has, if that is possible, for just these benefits. The flip-side is less amiable energy hedging counter parties after current contracts expire, but hell, who doesn't need a break?
By: Pitcher
Black Blade: Montana Resources, Denny Washington's copper mine, is shutdown pending a contract for lower power prices. Similar problems exist for other mines in Montana. The Nevada gold mines are already feeling the pinch, however, as the contracts on electricity need to be renewed, most of Nevada's gold mines will find it difficult to continue without intense high-grading to maintain profitability. Some mines have begun layoffs, and many are planning more. It looks ugly right now as the whole region around gold country is quite depressed. Several gold mine may simply have to cut back on production and therefore reduce supply to the market and to deliveries into the hedge book. This will stick it to the bankers as the miners will eventually be forced into a "Force Majuere" situation. This energy crisis may actually benefit gold in the long run. No body has been minding the store, and the shelves are bare - so to speak. The whole natural resource industry is under pressure with high energy costs, and that will also be passed along to the manufacturing sector, and eventually to the consumer.
Contrary to some, I post here with the distinct motive of having my thinking shot at, poked, prodded, ridiculed etc.. I am not here to teach, advise, explain or elucidate. I have a personal and commercial purpose of my own, which rests on my analysis of the conditions in the financial markets and in the gold markets. I use this forum for the purpose of having arguments, presentations, alleged facts and various and sundry thoughts challenged, one who thinks as I do does not help me at all. One who criticizes me might.
One who was prodded into a reaction - informative, reasoned, belittling, or belligerent might help me, though being associated with all manner of illegitimate motives might be maddening, but I separate myself from the useless critique and do not spend too much effort arguing against various accusations - I definitely don't take them to heart. Perhaps that is my problem, maybe I should take "personal" attacks more seriously. But I don't.
Another thing, I guess there has never been an attack on myself as intense, ill mannered, and so close to mud slinging as those afforded FOA. Thus I don't really have the same experience.
As far as emotional involvement goes, I recognize my online persona as an entity both within and outside myself. Attacks on this persona are kept entirely outside, and only serve to teach me what manner of disparagement particular kinds of persona elicit from the intense people that attack it with online Molotov cocktails when their reasoning or emotions are challenged.
For some reason, probably associated with the dryness of my postings, they don't ring emotional bells of the kind that FOA's postings do. The emotionally charged issues posed by both FOA and myself include the following:
-Challenge to perception of strength. - FOA challenges American's perceptions of their country's political strength, of the strength of their national currency (many of us identify with the nation and view the currency much as we might view the flag as representing the country). Final in this challenge is his intimation that our political leadership is in a corner and no amount of voting is ever going to change the basic facts of the corner they are in. What is more frightening is that he points out to that corner being the result of politicos actually trying to do what we demanded of them through popular vote.
-Questioning of fundamental perceptions. - FOA challenges the reader to understand that the monetary system is not reflective REAL wealth, but of an imaginary wealth - the common thought ("illusion" may be the better descriptor) that financial assets can be converted at near current values into goods and services in the future - the assumption that the move away from holding financial balances would be gradual rather than an event with a clear before and after, but with nearly no duration. Most people believe that prices creep up, not spike up. This despite recent experience in electricity, gas, and oil.
-The prediction of continuity of fiat. The idea presented that people will conduct trade in a hyperinflating currency when it is the key currency that is being destroyed rather than a peripheral one.
And then closer to the gold heart:
-The prediction of default on paper gold. The common (in history) experience of default on gold obligations is met with antagonism because these did not default during our last experience in the 70s.
-The prediction of governments taking over gold mines that are going bankrupt because of an intentionally broken price setting mechanism where the BIS is predicted to have the privilege of purchasing gold at an artificially low price.
There is, of course, much more to this. In presenting some of FOA and Another's thesis to Americans I found a rather outraged response to be quite common. People do not want this challenge to their view of how the world works. Who wants to be told that what looks like a productivity increase in the statistics is actually a result of monetary effects causing importation of productivity accompanied with minor improvement locally? People feel much better being told that they are "better" somehow, rather than playing part in a system that is not far from outright theft.
A second set of issues is in manner of presentation. Particularly the lack of mechanics to the analysis and forecast - which I am trying to do myself. Also lacking is detail regarding the politics of the matters despite this being a power struggle.
For the Libertarian faction here, it is the lack of moral outrage on FOA's part regarding what is obviously market manipulation on the grandest and widest scale imaginable. It is particularly disconcerting to find him thinking that answering Leviathan's alternate whimpers and threats, always demanding the impossible, provides some sort of justification for the actions predicted of people in power.
Furthermore, it is troublesome from an economic policy analysis point of view, to see FOA imply that the EU - inefficient markets, second rate products, total lack of service, restrictive labor practices (reminiscent of medieval guilds), and a very severe baby boom retirement problem - would be less sensitive to the global monetary disruption and would pull ahead as a closed economy. Granted, it would probably not get much worse, since so much is centrally planned and reform is ongoing. But Europe would still have to open up to trade much more rapidly than the US did in the 50s in order to make the Euro a viable international trade currency.
However, the EU, unless it obtains a defacto "deficits without tears" reserve currency status displacing the dollar, will suffer a monetary contraction as the ECB and member banks would lose dollar reserves (measured in Euro) as the dollar falls against the Euro. The monetary infusion required to counterbalance this on the CB books in a "mark to market" regime (which they already follow) would make necessary the setting of official gold prices in Euro very high (and even higher in dollars) in order to inflate the asset value of gold on their books to a level that makes the books balance (the alternative is to absorb Euro from the banking system � and collapse it through illiquidity � or for the ECB to declare bankruptcy directly). The other alternative is to continuously lower interest rates so that commercial paper held in the ECB system expands more quickly than the drop in the dollar. So far, the latter has been followed as the Euro monetary base expands by leaps and bounds. So far, these subjects were left rather untouched by FOA � aside from Another's suggested gold backing scheme for the Euro: irredeemable closed end gold reserve system, where gold comes into the ECB but can't leave.
How about pitying the men from the Travel Office who had their lives ruined?
How about pitying the 80+ people whose lives were snuffed out and buried in the rubble at Waco?
How about the people who died and are now suffering in the former Yugoslavia? Uranium and Plutonium poisoning?
How about the poor souls who happened to be near the chemical factory in the Sudan when he ordered missles fired on his impeachment day? Was that his handlers ordering that? Was he just sitting back smooking a cigar with some babe while someone else gave all the orders?
Your post made me ill.
Should we pity all the mothers, like my sister, who had to explain to their 9 and 10-year old what oral sex was because the kids kept hearing it on TV for a year?
Another item missing is the rapid industrialization and economic defrosting of China, and the coming release of Asia from its dollar bond - a requisite of dollar hyperinflation. The release of the dollar debt burden there and in South America would allow the locals to consume a greater part of their production (something the Japanese government has not allowed its own people).
Your first paragraph is slightly ambiguous. Do you mean not much foreign adventurism by, or against China? I can't believe you mean the latter, but one must be clear.
Remember what I have always tried to make clear, the people who 'use' America, use the UK and the rest of Europe. They were buddy buddies with Russia, even, all during the cold war. That 'cold war' was as phoney, at least from the US side, as a proverbial three dollar bill.
If you think they are not in the driving seat with Europe, then you are not 'in touch' with reality. You need to know who the main economic, and trade, ministers are.
Also, one must remember is that the US is only about 250 yrs old, and where did most of the people come from? You can't divorce the US from Europe in many respects. It is NOT the people, but who rules.
AND THOSE WHO HAVE THE MOST GOLD RULES! lEARN WHO CONTROLS THE MOST GOLD, AND YOU HAVE YOUR ANSWERS?
if I have misunderstood your sentiments, I am sorry. But please enlighten me
Before the next forum war erupts, can everyone just take a breath, drink a beer, and realize these letters on the screen can be helpful, if only read in the right frame of mind? If ones blood pressure and temper are raised by reading these simple letters on a screen...turn the box off, get some fresh air and drink much more beer. Use the forum for enlightenment regarding all things gold, not as a substitute for an adrenaline shot.
There was no insult made, or intended. And you jolly well know it.If hurt there was, then it was I who felt hurt at the way you had misjudged my post, to the point where you said my post made you sick. My posting was not a praise of Clinton, or the presidency, but a condemnation of 'the system' (TPTB) which controls.
Do you castigate the soldier (officer or ordinary combatant who wages the war, or the system( or sinister force) that
orders him to do so, as he knows he will be shot if he fails comply.
Lt. Carlie (may not have got the name right), who ordered the massacre of those Vietamese civilians, got away with it because it was said he was the victim of the system.
There are better analogies but am too busy to think them up.
Kennedy tried to buck the system once he was in power. He tried to be his own man, and go against those who 'helped' to get him in office for their own ends. He tried to put, not only America, but the world, at the forefront of his concern.
He thought he was strong. He did not learn from King Canute - or more near to him, from the assisination of Lincoln.
There was cynicism in my remarks about Clinton, but I wanted you to understand the system which your presidents, those who would aspire to be king, have to serve under.
Gentlemen, please just agree to disagree and leave it at that! I suspect that Dave is an American (USA) and Panda is European(UK?).
Every country has its embarassments. For the past 8 years (and more to follow) the USA has had to suffer through Bill and Hill. Bill's was truly a wasted presidency (pun intended). IMHO the best way we could communicate our revulsion of all things Bill & Hill would be to ignore them. Especilly Bill. He craves the attention. Let us allow him to vie for our attention in the future by his moronic lifestyle....we know he will try hard. He will add to the only legacy history will leave of him..sleaze and treason, or "SLEAZON". As for the UK, I remember hearing a phone call from a big eared sort, hoping to become a sanitary napkin. Embarassment can be found everywhere. Lets not let it sour the otherwise great environment on this forum for bringing differing opinions to the TableRound, in a constructive and respectful manner.
Now we think to be more morally and honest and like to be a better model for the future:right so-but sometimes our behaviour doesen't recommend us as leaders at all.
I agree, we should confine our postings to our common interest - GOLD. But, as I have always said, gold is primarily, and very effectively, a political tool. How many times have you read articles,or listened to media pundits, claiming that � there can't be inflation, otherwise the price of gold would reflect it.
It is known, that that is the way people have been taught to believe. And, to a certain extent, it appears, or so it can be made to appear, that such a yardstick has some truth.
All my postings have had one objective, which has been to help make people aware that gold is not controlled by elected government, or CB's, or IMF. or BoIS, World Bank or any other individual or institution you can care to come up with. Gold is controlled by those who control all these others.
Gold has been their preserve for centuries. They are the only ones who fully understand the real power of gold, and they have used this power to increase their strength century by century.
I honestly believe that, in theory at least, they are honest in their belief that they have a mission which is, in the final analysis, the establishment of a 'brave new world.'
What happens in the course of making that 'new world', however unpleasant, is a case of the end will finally exonerate the means.
Gold by its very nature, as stated, has great psychological power. It is also, to them, the only 'real' money, worthy of that status, between 'the elite.'
Without gold backing, or an alternative tangible item of value, currencies in general use for trade, lack substance and stability. Hence the currency fluctuations between nations. This causes problems for international traders. However, vast fortunes are being made by speculators, and traders, in currencies. Far more money flows in the currency markets than the stock markets. There is no real desire to kill this lucrative money play.
Also, to back a currency with gold would put the economic side of politics in arm and leg irons.
However, as gold is the money of the 'elite club,' there would be too much confusion if gold was fluctuating like currencies. There is a NEED to keep something simple, and stable.
As I have said. TPTB understand gold far more than anyone else. It is, and has been the source of their power. It has served them well. So, while they may wish to 'control' gold, they have no wish to 'kill' it. They know what the operating cost is of mines, there is no intention to wipe out the mining industry. Consolidate, and make more economical � yes, wipe out no.
The dollar has been the kingpin of currencies, since the pound stirling. This has served the 'elite' (TPTD) well. But just as the dollar took over from the once mighty pound, so will the Euro take over from the dollar. Think about it, the dollar and pound were never 'enemies' � a little family rivalry, perhaps, but there has always been that 'blood relationship' that makes blood thicker than water.
This will remain with the emergence of the Euro. There will be a touch of family rivalry, encouraged by media, because TPTB do not want all to know that it is all a game. And media need public excitement.
So, where does that leave us. It helps us to understand what is going on, and avoid too many errors of judgement. For instance, stop thinking that gold will go shooting sky high, or even making more than any modest move before the Euro is firmly rooted.
Gold has never been capricious, it does not have a will of its own, and most of it is well in the control of TPTB, so no 'enemy' can shake this grip. Don't cite that wild ride up to near $800, that was an aberration which was 'allowed' to happen, and from which TPTB made a fortune, before knocking it down again.
There is no reason why gold should not be back up to around $400 (in small stages) within the next two years, without causing any problems to elite circles. In fact, it would almost certainly be in their interest. By then, the euro will be strong, and the dollar will be a good back up. having recovered a little, or. at least, on its way to recovery.
To conclude, all is not bad. Believe in gold, try to understand its power, bu NEVER let it become your God. Have a good journey, but stop and smell the roses.
Could I be wrong? I could be, but I know where my money is riding. I only wish I had been taught at school, or at my mothers knee - 'The Power of Gold.
Iraq lost about 300 million dollars buy selling oil in euros
IRAQ HOARDS OIL REVENUES
WASHINGTON [MENL]
Iraq has been accused of hoarding oil revenue and reducing exports under supervision by the United Nations.
The State Department said over the last six months Iraq ordered humanitarian supplies of about half of its revenues. In the last half of 2000, the department said, Iraq purchased $4.26 billion from the $7.8 billion in oil revenues under the UN oil-for-food program.
The rest of the money sits in a UN escrow account. So far, the department said, more than $4 billion is reported in the account.
U.S. officials confirmed reports that Iraq has slowed its oil exports since December. They cited UN reports that as of Jan. 10, Iraq's reduced exports had already amounted to lost revenue of $1.4 billion.
Another Iraqi decision that has lost Baghdad money is its insistence on selling its oil in euros rather than in U.S. dollars. That decision, approved by the UN, will cost Iraq up to $300 million in conversion fees and lost interest, the State Department said.
Today's Daily Market Report: The Mongol Hoard Gathers. . .
1/29/01 www.usagold.com. . . . Gold took its
cue from other markets this morning trading in
subdued fashion and offering little in the way
of a clue what might be bubbling below the
placid surface that seems to have taken hold of
financial markets. Today and tomorrow we have the
Fed Open Market Committee meeting on interest rates
and an announcement on Wednesday. The markets could
care less. The prevailing wisdom at this juncture though
has the FOMC chopping another half point off interest
rates. "The market," chimes CNNfn, "is very impressed
by how much policy can be mobilized quickly to pull the
U.S. economy back to growth." So impressed that the
Dow is down over 20, the NASDAQ 30; the bond
market is sideways; and, the dollar (go figure) is up. So
much for the endless hyperbole from the stock promoting
channels. Somebody needs to whisper in the proper ear:
"We are in a primary bear market. Nothing is what it
used to be. Pass it on."
Gold through all of this is like the minister who forgot
what he was supposed to say at the funeral, i.e. Honor
the dead and give comfort to the living. But, that is
gold's demeanor these days. A quiet confusion reigns as
it does elsewhere -- a hiatus that showers the acquisitive
with beneficial pricing and the shorts with weekly
statistics that provide the kind of reassurance one would
experience upon arising in the morning to be greeted by
the Mongol gathering on the horizon. It is that enormous
short position -- a financial Mongol hoard -- that defines
gold's future. As David Skarica says in our Daily
Market Report masthead quote: "It is our feeling that
the short position is so huge in gold that gold will not
undergo a gradual increase, but rather a huge short
covering rally which will cause the greatest spike in any
commodity ever."
In the meantime quiet, disciplined and rational gold
accumulation remains the order of the day. We remind
you of the recent predictions from some of the top gold
trading houses as reported in The Australian: "For the
next 12 months, Salomon Smith Barney predicts the gold
price will reach $US325. BNP Paribas forecasts
$US290, Ord Minnett $US280 and Rothschilds
$US295."
That's it for today, my fellow goldmeisters. I'm not
certain at this point if there will be a report tomorrow as I
am putting the final touches on this month's News &
Views. I'll leave the current run of Notable Quotables
up for one more day for those who would like to
download and then we thin and start over.
From your #46802..."Yes, there were many short comings of Russian style Communism, but they might not have been so bad had Russia not been forced to divert vital resources to maintaining a huge war machine."
I'm going to try my very best to be reasonably polite but it's unlikely that I will succeed.
With your obvious understanding of politics and economics, I was stunned to see a comment like this from a goldbug with your intelligence. How can this be? There can be only two possibilities.
#1. You make these statements to provoke us 'emotional types'.
#2. You're the biggest damn nencomepoop I've ever seen.
Bubba MAY have had a FEW people killed but Lenin and Stalin had MILLIONS of people killed before 1939. I don't know where you're coming from but you're sure full of crap! Be a sport and keep the provocative BS to the weekends....we're trying to make a buck here.
The prediction prices of the clearing houses are interesting. Yes, there could well be a short squeeze over the coming months, probably just after a slight dip down. Those projected prices would cause the shorts to come back if gold should pass those projections during the thrust upwards. A further squeeze could then take it to just short of $400, from where it will be brought rapidly down.
What would this achieve for the manipulators. (1) a bit of excitement (2) A little more doubt that anyone is controlling the price(3) A stimulation of the gold future, and option, market to attract lower echelon players. (4) Because of the way it would be suddenly brought down again, it would make people more nervous, and it would bring in the shorts again next time in greater numbers, when the next move up is made.
(5) It would also test the ground to see if all those hedgers have pulled in their horns. Those that haven't should have prices that make them great take-over targets.
Few people realise it is those shorts being squeezed that provides the thrust for a really good sustained 'lift off.'
SL&TT, as the self-proclaimed safety boy I will tell you that I am an American living in Europe. So I guess you were half right.
To PandaGold, I have studied the Clintons since he came on the seen in 1992. I have devoured all the books, articles, videos, etc. To have pity on this man, or his wife, because they are pawns, is to have pity on the devil himself.
Enough said. I'm done on this one.
I would ORO to elaborate on his comments about the Asians dumping the USD regime. I get the same thoughts reading what is coming out of Asia. China is the key. They will call the shots as they did a week or sao ago in telling the Japanese that the Yen was going too low.
I will let the uncalled for vitriolic attack pass. (I scrubbed out one reply which sort of referred, among other examples, to how many millions the CIA had been responsible for instigating the killing of around the world.)
I will merely say to you - it is a pity your emotione blinded you from the essence of a posting.
With reports of the junk bond and corporate bond market firming up, the NASDAQ looking to build a base and the FED clearly going to cut 50bp on Wednesday, is risk back in vogue? And if so, for how long?
"A UC Berkeley professor is challenging the medical
establishment with a theory that could revolutionize Pap smears, update
chemotherapy techniques and alter the direction of cancer research.
"Molecular biologist Peter Duesberg argues cell irregularities associated
with cancer are caused by chromosomes and not by genetic mutations,
as is widely believed.
"If cancer indeed lies in varying chromosome numbers in cells, Duesberg
said, doctors would be able to make many more definite determinations
after administering Pap smears. Currently, many Pap smears,
administered routinely to detect early uterine cancer, offer ambiguous
results because many factors, including cancer, can render cells
irregular."
"Duesberg published his first paper on the subject three years ago. Last
month the journal Proceedings of the National Academy of Sciences
published results of an experiment conducted by Duesberg and his
colleagues, lending credence to their ideas.
"Richard Strohman, professor emeritus of molecular and cell biology at
UC Berkeley, said Duesberg's theory will generate controversy, though
the greater scientific community needs more time to digest his ideas.
"'This is not the same kind of theory that geneticists and molecular
scientists are used to dealing with,' Strohman said. 'Peter is hitting a
nerve, because he is pointing out that none of the research done over the
past 60 years has worked.'"
Thanks both of you for "colluding" to provide the Another (Thoughts) of yesteryear.
In reading same, one can come to the following conclusions (given current event's) :-
The Oil/Gold thingie is on-going.
All the better for us that it is.
POG is irrelevant.
As the POO rose these last couple of year's it became apparent insufficient Au was coming to market. The BoE and Swiss "sales" have to a large extent stifled a further rise of Oil - for the moment anyway thus providing a more ordered transition from $US world reserve status.
FWIW, The A/FoA scenario is right on track... for mine!
50 basis point rate cut seems certainly in the cards Wednesday based on Fed's deal today
If these numbers are worth the space they occupy, then when the FOMC meeting ends on Wednesday, we will likely be handed a half-percentage cut in the Fed's target rate for the federal funds market.
In today's open market operations, the Fed added $2 billion in reserves to the banking system using 28-day repurchase agreements. Given the duration, it is instructive that the stop-out rate in this operation was 5.48% for the Treasuries, and 5.55% for the mortgage-backed securities used as collateral. You must recall that the Fed's target rate is currently at 6%.
Following that operation, the Fed again entered the market and conducted another round of repos, using overnight RPs to add an additional $5.505 billion to the banking system. By way of contrast from the longer operation, this one was accomplished with stop-out rates only slightly under the six percent target rate.
So now you know. The money continues to flow, and the rates shall likely fall this large step. Whoooooosh! You might want to call Centennial today to exchange out of some of your dollars for metal if you are concerned that the additional shift toward an easy money policy might spook the gold market higher before you complete your planned acquisitions.
Given derivatives-based price discovery, it is hard to say which direction will be taken, so the "gamble" is yours to either act now or to wait. But one thing is for sure... if you have dollar accounts yet no gold (the metal) in your portfolio, then you ARE definately gambling upon the good performance of the dollar itself. And as stated above, while it is uncertain whether a Fed rate cut will cause a favorable performance of gold derivatives, it IS certain that such action would be no favor for the purchasing strength of the dollar itself.
Of course, this commentary is offered with the assumption that you recall past discussions regarding expectations for a gold derivatives market crisis that would not permit physical gold to be purchased in a gradually rising nature, but rather abruptly as the paper form falls into default.
http://home.flash.net/~rhmjr/index.htmlHi Dave,
Might I direct you to the above link (offered yesterday). The fellow has a Dow/Interest rate correlation chart relating to the '29 plunge (among other interesting items).
My morning blab (smile), Pandagold, Black Blade, ORO
Honest, I'm trying to cut back...
Pandagold: Do you mean to say that our country uses PROPAGANDA? I am shocked, positively SHOCKED! Banish the thought!(smile)
Pandagold, your views are well summarized in "The Power of Gold". Perhaps a wise further course of your posting would be to recommend a syllabus of any authors with whom you agree as background so that we may get "on the same page" with you, as it were. Surely, that would not expose you too dangerously? Then we might find that we could stipulate (in brief reference) to a general level of agreement or uncertainty about your referrals. Seeking maximum effect to your time and generous efforts here.
Black Blade: Re: the Miningweb and other reports of power prices or profitable sell-offs of power shutting down mines. Do you think you've located another Horseman? (When did we last count those anyway?)
ORO: You've got your mind set on a goal. Sounds an important enough one to overrule counterproductive emotions. Yet you seem able to be patient with the emotions and frustrations of others as they are vented here. Quite an enviable combination, Sir.
Oro, the Euro's appeal as alternative to dollar: is it based on the viability of European economies as much as on the promise of money supply stability? (Of course that is more likely to be violated if stagnant economies need that "extra boost", so maybe you're saying that already.)
Is the "aging of the currency" (as cited by FOA) through debt something that occurs after commercial paper quality is necessarily deteriorating to keep previous paper afloat? I'm imagining the Euro-denominated debts are still "fresh", but does this denote a high standard of credit-worthiness? Or just that the system will not be in jeopardy if they are not bailed out by ECB in a pinch?
BTW, Oro, you nailed probably all of the "uneasinesses" that FOA arouses in USAmericans, but it seems the attacks usually come from "personalists" on their own "voyage of self-discovery." The longer-term posters here sometimes seem "struck dumb" for a few hours after FOA's contributions, and then start in with a few questions that occasionally get a vibrant exchange going.
But it still seems to me there is a gap between the level of overview (even with a "lack of mechanics") he brings to us and the off-site study we might be doing to take fuller advantage of his presence here. Mea culpa, but I neglect my business enough already with the time I spend online. That's one reason why I hope we have many more years together here to watch events and learn together.
Wednesday being First Notice Day, marking the opening of the delivery window on the February gold futures contracts, it comes as no surprise to us all here that we are now seeing massive rotation out of "physical jeopardy" and into the distant April contract which can be traded with non-metallic impunity like a deck of shabby baseball cards.
Friday's COMEX action witnessed offsetting trade closure of nearly half of the February contracts, as the open intrest was reduced by 20,000 to leave 24,300 for participation in today's trading action. Meanwhile, the open interest in the April price contracts rose by 22,800 to a sum of 78,100.
Those gold-minded persons seeking prudent portfolio diversification must strive to recognize that they cannot effectively hedge or secure the safety of their assets against a currency/banking/derivaties crisis if the assets they choose to hold as a diversification are themselves intertwined in the common fate as various on a paper-based theme. Thus, paper gold derivatives that seem to intuitively promise counterperforming price protection actually may do nothing more than offer you a hard, leveraged lesson in counterparty risk.
Just as gold coin in hand was a protection against lost wealth during the age old days of bank and banknote failure (an early American form of gold derivative), today gold metal in hand is your protection against failure of the many modern forms and variations of these derivatives.
Experience outside The-Best-of-Times shows that "owning the price" is poor substitute for "owning the asset".
Ultimately, only you can make these decisions and take action. Nobody is going to walk up and force gold into your pockets. Call Centennial today. They know this business like none other and strive to serve you well.
ET (1/29/2001; 11:05:08MT - usagold.com msg#: 46825)
Back in the summer of 1994 I was in Kansas City (hot) working on a consulting contract. I was listening to this talk radio show and a wonen doctor is on. She had cured herself of breat cancer. She said she increased her intake of some supplements but the most important thing she did was change her diet.
She then began to do research into the cancer industry. What she found would probably not fool anyone here. Too many "doctors" driving around in limo's. As she put it, it was a story about "follow the money".
"Those gold-minded persons seeking prudent portfolio diversification must strive to recognize that they cannot effectively hedge or secure the safety of their assets against a currency/banking/derivaties crisis if the assets they choose to hold as a diversification are themselves intertwined in the common fate as VARIATIONS on a paper-based theme."
http://www.lbma.org.uk/lbma_members.htmlDid LBMA form around 1980, and did Comex start or start trading gold paper around 1980? This would be a correlation of FOA's thesis about the attempt to contain gold prices with paper.
Posting has never been as important to me as reading and learning. I recognize that I have too much too learn, to be trying to teach others. I visit for the opportunity to learn how the economic system works. There are a good many posters at USA Gold who have invoked thought. I had no schooling on this subject when I began visiting here. There have been and still are a number of posters who I felt were self-serving and arrogant. Whether they were or not, by choice, I scroll right on by and ignore them
When I first began posting, there came about a controversy between a few who still post here. I injected some thoughts regarding the ground rules. These few, took it upon themselves to arrogantly defend themselves by slinging their personal opinions. In this free society, it was their option to state their opinions. In the same vein it is my choice to determine what I read and I choose from where or whom my information comes.
FOA, whether it matters to you or not, I put a great deal of stock into your opinion. Oh, there are others, but right now they are not in need of encouragement. I understand how it feels to be grossly misunderstood at this forum. However, knowing that I personally do not have one ounce of information that is useful or beneficial to this forum, I determined that my silence in response to the destructive demeanor was an acceptable position. You on the other hand, do have information and I for one would like to see it continue. I understand your reluctance to continue, degradation in public is never fun for anyone.
I would like to offer up this one statement that has helped me see past personal attacks by those who are self-absorbed, "arrogance does not see itself as arrogant", if you opt out to not post here, it is people like myself who will lose. On the other hand those who attack people they differ with are not interested in what anyone else has to say anyway. They are way too busy wallowing in their own pool of self-aggrandizement. And your reaction, whether it's a decision to stop posting or defend yourself in anger is to fall right into the trap. Think of the wasted time, energy and knowledge. As it was put to me once when I was listening to a man talk about the interest people have in each other, and he was referring to conversation not posting on forums, but the same applies. He said, "Most people are waiting for you to shut-up so that they can talk." I'm convinced that the majority of people in this world are so insecure in their own thinking that they are continuously trying to win others over to their own way of thinking so as to give them a feeling of power. When an individual attacks you, think of them as insecure, and willing to do whatever it takes to gain self worth.
The truth of the matter is that I have enough working knowledge of economics and gold now that I'm am firmly grounded in my thinking. Thanks to you and others like you, I know why I believe the way I do. However, in coming to this site, I would still like to be able to read your insights. Everyday I scroll through the posts to see if you have contributed. Thanks for all you have taught me.
These thoughts are offered in light of the recent upset on this forum and FOA making (ANOTHER) exit from the forum. I say "ANOTHER" exit, because this latest exit is the third, I think. From memory, the first exit was when Another was still posting here (Another made apologies for FOA, and
FOA made apologies too.) The second, I believe was when the FOA/Trail-Guide Gold Trail was established. The third is the recent exit.
Prediction: Since ancient times, credibility is won through the test of prediction. Indeed, it is still, especially in science, for example, it is a main criteria by which animal intelligence is measured. Credibility gained through sharing theory is, generally, much less. Prediction requires an event and a time (or a time frame).
Description: Whether description of a theory or description of a prediction, effective communication requires organization. Without organization, the theory or prediction can be nebulous, easily misunderstood, confusing. It is also true that the more effectively a prediction or theory is communicated, the more easily attempts can be made to denounce it, because it is specific, exact. For predictions consisting of a series of events, serial organization is probably a good choice.
Detail: The more relevant detail provided in communicating a theory or prediction, the more easily the theory or prediction is understood, or denounced. As details of a prediction or theory are proved (or come true), credibility can be gained. Conversely, to put forth a theory or prediction and not provide relevant detail that can be verified is to deny the audience its opportunity to evaluate the theory or prediction.
I like lots of detailed descriptions of predicted events concerning gold, POG, the giants of the gold market, etc., and the FOA/Another scenario is complicated; therefore, not only do I like the detailed descriptions, for me to understand the FOA/Another scenario, I *need* detailed descriptions.
I came across this statement just a few minutes ago. "To be wise, the only thing you really need to know is when to say 'I don't know.'"
First, let me say to USAGOLD that I am quite honored to be included in your list of longtime posters, even tho I haven't been posting much recently.
Second,why hasn't anyone else besides me picked up on the turmoil going on in Sir Trail Guides personal life?
From his most recent post:
< All this in the middle of an ongoing adjustment I'm making myself, in my life.>
No one knows what those adjustments are, but give the man a break, it's quite obvious something in his personal life has devastated him. From my own experience, when my 11 1/2 year old daughter died in 1992,,,I'm still trying to get over that!
A personal plea to FOA, from my family to yours,please take all the time you need to mentally adjust, and when you feel the time is right please come back to guide us(Lemmings?) once again.Our family has greatly benefited from yours and Anothers eye opening words of wisdom concerning "The World of Gold".
My motive for posting may be considered a selfish one; Since I have made an investment in Gold I feel it is important to learn and keep up to date on the entire Gold industry. I lurked for over one year at Kitco and didn't post here at USAGOLD until I felt it was a safe environment for my sometimes bizarre thoughts. The internet is such a new method of communication it's still going thru severe growing pains simply because of the huge differences in cultures,backgrounds,upbringing and interpretations of written words. My posts are a feeble attempt to give something back to so many here that are adding to my on going quest for knowledge.In the humble words of Another,"I am but a simple man," but really noone of us here are simple, we are all extremely complex!
Part II, has anyone else thought about this?:
Many,many months ago FOA, ORO, USAGOLD, and many others agreed that Comex and LBMA( the accepted worlwide pricing mechanisms for Gold)would collapse eventually because the paper representing Gold(Shorts)was so much greater than actual Gold deliveries.At that time Republic Bank of New York was a major player in Comex.
Republic was,IMHO hurriedly, taken over by London based HSBC offices in 62 countries!
Now, lets speculate a little about this, usually when a bank is "taken over" it's a nice way to say; If that bank tried to stay in business they would have financial problems in the near future. In the case of Republic(A Bullion Bank)they may have been running out of physical Gold,,,there was a run on Gold after the "Washington Agreement". That run may have depleted Republics physical Gold holdings to a dangerously low level! Hence, HSBC to the rescue..Ta Da!
HSBC along with Scotia Mocatta, has physical Gold resources from the entire former British Empire and then some.
Now you may ask, as an American what does this have to do with me?
I submit, even tho the U.S. mines almost 400 tonnes of Gold annually they don't have enough Gold for sale to have representation at U.S. based Comex! Doesn't that seem odd?
Most U.S. newly mined Gold must be already spoken for or is owned in the form of paper Gold.
So, the bottom line is, Comex may have been almost busted on stores of real Gold after the Washington Agreement, and we Goldhearts didn't even realize it! The prime question which I cannot answer is; When is the whole world going to run out of physical Gold for sale, causing a short squeeze and price explosion in Gold??? Most agree demand has outstripped supply for a long time now.Thanks for Reading.
We Watch and buy Gold Together When Possible ....beesting.
I hope noone will mind if, after a suitable diagnosis, my prescription for this forum is a little levity. Please excuse the mild cussing in this piece. What can one say about those rascally Texans?
The Texas Way
Since we now have a new president, the foreigner's
Travel Guide to Texas:
Like it or not, the new Texas White House will be
in Crawford, Texas and soon will be drawing a number of people to the state, including many who are
not used to Texas ways. They might find the
following advice useful.
1) Don't expect to find filet mignon or pasta
primavera at the local restaurant. It's a cafe. They serve hamburgers and chicken fried steak. Let
them cook something they know. If you confuse
them, they'll kick your ass.
2) Don't laugh at the names (Merleen, Bodie, Bubba,
Bobby Ray, Curley, Tammy Lynn, Billy Joe, Sissy, Clovis, etc.). Or we will HAVE to kick your ass.
3) Don't order a bottle of pop or a can of soda.
In Texas it's called a coke. Nobody gives a damn whether it's Pepsi, RC, Dr. Pepper, 7-Up or
whatever - it's still a coke. Accept it. Doing
otherwise can lead to an ass kicking.
4) We know our heritage. Most of us are more
literate than you (read some J. Frank Dobie). We are also better educated and generally a lot nicer than
you. Don't refer to us as a bunch of cowboy hicks,
or we'll kick your ass.
5) We have plenty of business sense (e.g., Howard
Hughes, H. Ross Perot, Southwest Airlines, Dell Computers). Naturally, sometimes we have small
lapses in judgment (e.g., Phil Gramm). However, we
are not dumb enough to let someone move to our state just so they can run for the US Senate. If
anyone tried to do that they would get a serious
ass kickin'.
6) Don't laugh at our Civil War monuments. If Lee
had listened to Gen. Hood you'd be paying taxes to Richmond instead of Washington. If you visit the
Alamo, take your hat off and be properly humble, or
we'll kick your ass.
7) We are fully aware of how hot it gets and high
the humidity is, so shut up about it. If you can't stand the heat, get out of the kitchen, or we'll
kick your ass.
8) Do not attempt to eat tamales without first
removing their cornhusk casing. Everyone will instantly know that you're a Yankee. DO NOT, under any
circumstances, complain that the chili is TOO hot
or contains no kidney beans, this will get your ass kicked into next week.
9) Don't talk about how much better things are at
home because we know they are not. Many of us have visited Northern hell-holes like Detroit, Chicago,
and DC, and we have the scars to prove it. If you
don't like it here, Delta is ready when you are. Move your ass on home --
before we kick it.
10) Yes, we know how to speak proper English. We
talk this way because we don't want to sound like you. We don't care if you don't understand what we
are saying. All other Texans understand what we are
saying and that's all that matters. Now, go away, or we'll kick your ass.
11) Don't complain that certain areas of this state
smells of oil. If your livelihood depended on those wells you'd soon learn to love the aroma.
Besides, None of OUR lakes or rivers have caught
fire recently. If you whine about OUR scenic beauty, we'll kick your ass all the way back to
Pittsburgh, PA.
12) Don't ridicule our Texas manners. We say sir
and ma'am. We hold doors open for others. We offer our seats to old folks. Such things are expected
of civilized people. Behave yourselves around our
sweet little gray-haired grandmothers, or they'll kick your ass -- just like they did ours.
13) Don't think we're quaint or losers because most
of us live in small towns. We do this because we have enough sense to not live in crime-infested cesspools like Baltimore. Make fun of our small towns and
we'll kick your ass.
14) DO NOT DARE to tell us how to cook barbecue.
This will get your ass shot (right after it is kicked). Criticize the barbecue and you may go home
in a pine box -- minus your ass.
15) Remember, the only reason you are lucky enough
to be here in the first place is because we have not pulled the Border Patrol off the Rio Grande and
put them on the Red River (where they really
belong) to keep your ass out. Enjoy your visit.
Link is to Red Baron's Gold Eagle series on LBMA in late 1997, after it was revealed that year to be the principal gold exchange. I read it before I came to USAGold, and maybe it's time for a refresh. Lots of early ANOTHER commentary there, too.
Hey Topaz - how you been? Your comments concerning A/FOA are on the money! I agree 100%. POG is irrelevant. I keep thinking, why are so many upset with the POG staying low? If A/FOA analysis is correct, this will prove to be the greatest buying opportunity of all time (to borrow a phrase from our Wall Street friends). Being afforded this glimpse into the inner workings of our monetary world should prove to be one of the greatest chances to "get ahead" on a relative basis we will likely ever come across.
Hey DaveC - good to hear from you. As it turns out I live just outside Kansas City and am familiar with the station you heard and the doctor. She is Lorain Day (not sure of the spelling), and she has done several videos and one book about her experiences. In a similar vein Harvey Diamond has a new book out titled, Fit For Life - A New Beginning, which expouses the same principles Dr. Day used to recover from cancer. No doubt like the AIDS/HIV scam, cancer falls into the same "follow the money" catagory. Proper diet and exercise has been found to prevent nearly all maladies. It all revolves around the principle that with proper diet your body's immune system can fight off and heal virtually anything. Dr. Day is living proof!
Since were on the medical industry's case, another book everybody should take a look at is, Prozac - Panacea or Pandora?, by Ann Blake Tracy. These anti-depressants have been found to have all sorts of bizarre side effects. It's a shame people believe the FDA has their best interests at heart. After reading this book it becomes easy to see whose interests the FDA does look after. If anyone reading this is taking any of these drugs or knows anyone that is, please obtain a copy of this book. These drugs are much more powerful and addictive than advertised and can have violent side effects. Why any doctor would prescribe these pharmaceuticals knowing some of the consequences doesn't speak well for the medical community and its protectors.
DaveC - China and Asia, comment to Gresham and BlackBlade
The point is simple. Right now, and for the past 20 years or more, the Asian countries had been standing with piles of debt that were incurred mostly in capital expenditures, but also in oil imports. The debt caused the need to obtain dollars through export to the US and to other countries with large dollar holdings/income. Without this, one of two things would happen; the companies go bust and their assets are taken over by creditors, or the government tries to retain local control/ownership of productive assets through the central bank, goes into insolvency in dollar terms. As a result, foreign banks and trade partners no longer offer trade financing, moving to cash settlement, thus raising the size of the working capital required for the whole of local industry - often by an amount equal to the original capital investment.
Thus the cost of not having a sufficient dollar revenue to cover debt payments is a major chunk of cumulative capital investment - in a good recent example we see bankrupt Daewoo of S. Korea being sold at less than 60 cents per dollar invested - providing a 40% loss of capital, which was better than the 60% loss expected by credit analysts.
Hyperinflation of the dollar generally favors debtors with long term debt at fixed interest. Both costs and revenues rise during price inflations, while debt remains fixed, resulting in a fall in the debt service burden relative to cash flows. As an example, during my youthful experience with hyperinflation, the crushing debt of my folk's mortgage payments from the early 70s became the price of a postage stamp less than 10 years later, the bank then proceeded to cancel the remaining balance because billing was more expensive than the payments being made. Furthermore, everyone eventually carried an overdraft of a month or two of salary, not at all caring about the interest rate paid.
In the dollar debtor nations, the fall in debt burdens would allow the debtor nations to reduce exports in favor of local consumption. Real incomes would rise, and the portion of local production that is exported would drop. Furthermore, the interest rate differential (spread) between the US based and the foreign based debtors would drop in real terms as well.
China in particular, and SE Asia in general (India being the rapid grower now), are undergoing various stages of the industrial revolution and the industrial development path that the US had undergone since before the Civil War, and Europe had gone through in the early to late 19th century and in the rebuilding of post WWII industry. The most substantial demographic and industrial trend was the substantial move away from farms and into industrial towns and cities. The process involved farmers sending young family members to work in the city. The new industrial workers saved a substantial portion of their pay and sent it home, where the money was used (by the more fortuitous) to buy industrial farm equipment, which allowed (or forced)more people to move from farm to town, as the fertilizers and tractors of industrial agriculture made crop output per farmer rise and the size of a farm crew's work area go from a dozen acres to fifty and more.
(It is interesting to note that France, which saw little fighting and was not devastated, never completed the transition from agriculture to fully industrial economy. As a result, when industrial agriculture was threatening the viability of small marginal farmers, the already established French socialist system instituted subsidies to the farmers. When the European Union was formed, France demanded that the rest of Europe participate in the costs of these subsidies. And so it was.)
China is still in the early stages of undergoing this change, and needs capital equipment to build the new factories. Only now does China have enough engineering talent and capital equipment production facilities to build their own infrastructure. Thus their requirements for foreign investment and debt relative to the size of industrial production are falling, though overall quantities are rising. The Chinese industrial system still has many pieces missing, and has many holdovers from the state entrepreneurialism and communist collective periods of the past. These state factories are inefficient to the extreme and fail when competing against imports from SE Asia, or from private local manufacture. The employees of these industries are the "grass roots" level of the communist power structure and much effort was put in by the Chinese government to protect them from competition from the general labor pool, which is still mostly agricultural. Farmer's families are restricted from having family members go to work in town, and all sorts of red tape are put in their way (work permits, travel permits, travel allowances, etc..), as well as having discriminatory pay scales applied against them.
But the threat of agricultural imports in the near future from US and Asian/Australian industrial agriculture under WTO terms means that either the farmers practicing traditional iron age technology go bust in one large wave and arrive in the cities en-masse as refugees, or they be allowed to send growing numbers of family members to town in order to have an easy transition and a natural growth of farming capital. Furthermore, the party cadres in the heartland that hold the country together and under the thumb of the communist oligarchy are becoming progressively more hated by their charges, and are embittered themselves due to the industrial opportunities lost by remaining in agrarian areas themselves.
China's industrial economy is now well past "critical mass" and the private sector had just overcome the state entrepreneurial sector in output size last year, and should employ more people than state industry this year (not all of the employees are legal). The old state industries and the state banks that funded them are falling apart as private market competitors, both legal and underground, are taking market share, lowering prices, and stealing top labor and management talent away from the state sector. Without the "benefit" of subsidized loans from state banks, that saddled the state sector industries with heavy debt service, the private market industries (and newly semi-privatized banks) have grown out of cash flow and are thriving like no one has ever thrived before. The lowered Yuan/Remnimbi (accomplished by introduction of an export tax credit recently) is well beyond what the private sector needs in order to sustain its own growth, but is all the Chinese government can do to keep the state sector (and the core of its power base in the cities) afloat.
However, the Chinese accumulation of dollars and its industrialization in the direction of exports (particularly to the US) will mean that during the hyperinflation period they will lose purchasing power (not that much, but still some) and have to refit plant and distribution systems over to local consumption and to allow the retail sector to grow disproportionately to the economy for a while. This problem is shared with most of SE Asia, and with Japan, which is still dealing with this sort of transition as both the dollar amounts and volume of their auto and electronics exports to the US have dropped but the government insists on replacing the employment in producing these with "make work" projects instead of allowing a modern retail and distribution system to develop. Hopefully, when the time comes, SE Asia will avoid this error. China, unless the communists lose control (which is not out of the question), will most likely continue trying to push more exports despite the strong economic trends against it, in order to maintain viability of the state industries just a little bit longer.
Mr Gresham, BlackBlade
Malinvestment has two sides. One is the over-investment in creation of non-viable businesses � which creates a chain reaction of over-investment at competing companies fearing loss of market share (essentially replacing older investment before its time, thus consuming capital). The other side is the draw on capital resources for unfashionable industries � e.g. power, gas, oil, steel, etc.. The result is under-investment in these unfashionable areas, as they are outbid for labor and capital by the fashionable industries at which the Street throws copious credit. Thus small rises in demand strain the under-invested industry's capacity, and prices of their products escalate relative to those of the products of the over-invested industries.
Inevitably, the products of some under-invested industries are inputs to over-built industries. Thus while prices of the overbuilt supply fall, prices of the inputs rise. Furthermore, the industries in the middle-ground (where investment levels were reasonable) are now competing with the over-invested industries or with consumers for the same products that are in short supply. These shut down operations quickly as spending volumes shift towards the products in shortage, thus creating a certainty of a future price shock when enough capacity is shut down so that these products are again in short supply. Finally, the high prices make investment attractive in the under-invested sectors (even out of cash flow alone) and create demand for labor to produce new capacity and new product. However, that labor is not necessarily where it is needed, and must be enticed from its current location (close to the centers of the over-invested sectors), by being paid a higher pay, compensated for moving and retraining expenses, have new housing built, and have consumer infrastructure expanded.
In our case, energy was the most under-invested sector, next resources and primary industries that use a great chunk of energy are under-invested. But there is an inventory overhang (now being quickly drawn down) resulting from the under-investment in the materials intensive energy infrastructure, and from the foreign supply shock resulting from the dollar rise, which has just ended. As a result, users and intermediaries who were slowly drawing down inventories are now forced to find new supply as the prices they could afford to pay were not sufficient to cover the energy content of their primary material inputs. Thus primary industries shut down some capacity, sell the energy supply contracts, and leave their customers to import or use up outstanding inventory. Their product prices rise as inventories are consumed, and prices finally move up to reflect the new shortage.
Eventually, this process repeats as it goes up the path of production towards the consumer. At each stage, capacity is taken down, shortage is created, prices go up. This continues as stagnation complements rising prices in what we know as "stagflation". In order to alleviate the problem that is created in credit markets as a result of narrowing gross margins (namely not having enough cash flow to service debt), the central bank monetizes existing debt by purchasing it off the market at a lower interest rate than the market rate (otherwise it would not have bought the debt off the market because it would have bid below the market price and above the market interest rate). Thus it does three things: (1) supplies fresh money into the monetary base , (2) lowers interest rates below the market, thus encouraging new borrowing that can be used to finance new capacity construction in the under-invested sectors, and (3) raises financial asset (debt paper) values by over bidding for them � thus maintaining the solvency and liquidity of banks and other financial intermediaries and leveraged institutions.
Harken and Hearten Brave Knights...all is not lost.
That we have offended a fellow Knight and befouled his armor is an unspeakable blot upon our noble cadre. However, our noble friend after wiping his armor with his gauntlet and casting the offal back at us with hasty aplomb...those of us keenly aware strategically ducked behind Sir Thaigold to avoid becoming besplattered...did say that he would continue posting on the "trail" venue.
I expect He will not be back here as "Trail Guide" soon. I for one will surely miss him. I expect that he has said enough for now although I was looking forward to tales of the Roman times.
I shall cherish the memory of your past visits to this round table noble Knight of "Another" order. Farewell my friend...Godspeed to your final destination. We look forward to the sounds of the heraldry at the arrival of your much anticipated messages from the front.
Remember that you do have many friends here who but listen and learn.
Please accept my sincerest thank you for that portion concerning me; but in that regard I am quite certain you have pegged the meter which attempts to measure such offerings of undeserved kindness.
True. The United States needs an enemy to sustain its economy. We did not become a super power by growing corn.
The byproduct of war is new tech. Russia was force to divert vital resources to keep up with our war machine if they wanted to spread their form of goverment.
Nencomepoop? Nen- come-poop? Oh! I get it.
Slingshots an nencomepoop and wants to make money.
China proper has not adventured outwardly against others.
Up to now, anyway.
Yes, of course I think, "they", are in the drivers seat
in Europe. That was the whole point of my post.
Europe from Cornellius Sulla, Nero, Napolian, on up
to Hitler, has a long History of those who would aspire
to Anti-Christ.
You are not alone in giving a seeming aura of power and orchestration to a invincable, entrenched, cabal of supermen "users".
I see it thusly, Do not underestimate the duplicity of
America. The Euro may or may NOT de-throne whatever American
currency rises from the ashes.
What I don't think you understand about America, is that at the core the driving FORCE is "Manifest Destiny".
The World is a stage for that destiny to manifest.
Who has the gold is certainly important, but the WILL to
dominate, is more so.
LBMA was formed on the 14th December 1987. Today's membership includes 60 companies, 14,of which, are market makers (subject to change) and 13 countries are represented
(by interest in member firms)
Did I claim to be alone? I would be most worried if I thought I were, I assure you. In fact I might even begin to doubt my thoughts and beliefs.
I have read, and re-read what you say in your last post but I must admit that I am not quite sure on which points you are agreeing,(if any) and which not.
But I believe enough has been said on this - at least by me.
May I refer you to my post # 46817 which, I trust, clearly states my postion.
"Eventually, this process repeats as it goes up the path of production towards the consumer. At each stage, capacity
is taken down, shortage is created, prices go up. This continues as stagnation complements rising prices in what
we know as "stagflation". In order to alleviate the problem that is created in credit markets as a result of
narrowing gross margins (namely not having enough cash flow to service debt), the central bank monetizes existing
debt by purchasing it off the market at a lower interest rate than the market rate (otherwise it would not have
bought the debt off the market because it would have bid below the market price and above the market interest
rate). Thus it does three things: (1) supplies fresh money into the monetary base , (2) lowers interest rates below
the market, thus encouraging new borrowing that can be used to finance new capacity construction in the
under-invested sectors, and (3) raises financial asset (debt paper) values by over bidding for them � thus
maintaining the solvency and liquidity of banks and other financial intermediaries and leveraged institutions."
From that - would you say the "crack-up boom" is upon us? Do you believe the masses are waking up and becoming aware that inflation is the deliberate policy? I don't see where new borrowings by under-invested industries will counter the deflationary aspects of over-invested industries going bust without central bank interference which becomes obvious in everyday goods and services prices. In other words, when does stagflation turn into a panic over the lost purchasing power of the currency?
On another note - have you ever posted any type of analysis of the Russian situation? If you have, could you point me in the correct direction and if you haven't, and feel you have the time, could I have your analysis of current trends in that area? As always, your work is much appreciated. Thanks.
Randy, thanks for the COMEX numbers. You mentioned (46832) that the funds or non-commercials have offset about 20,000 Feb. contracts and established about 22,800 in April. For those not familiar with this, it means they bought back Feb. contracts previously sold (at a higher price) and sold contracts in April (hoping to be able to buy them back at a lower price in the future).
Randy also mentioned this "short" position as large in quanitity. As of 1/23/01 the funds (speculative money as opposed to producers or users of product) had bought
15,626 contracts and sold 73,324 contracts. There were a total of 140,120 contracts. Obviously, with over 50% of the short position held by the funds, things are set for a short squeeze but it requires reluctant sellers when the "shorts" have to cover (buy back). This just recently happened in Cocoa. A look at a cocoa price chart shows the almost straight up move of a squeeze. It didn't happen in gold in this expiring Feb. contract but the trap is still set.
Cocoa by the way, up from about 750 to over 1050 in less than a month. It takes a lack of sellers to make a short squeeze and then the frantic shorts, who have to buy, drive the price up. If/when it happens, it will be sudden and quick! I've not seen the funds with this large a short position that I can remember. It won't take much to trigger the spring. How do they say it at kitco? To da moon!
Waiting
Rich
Right now there is yet no "crack-up" boom. There is a pre crack-up atmosphere since 1998. People are moving aggressively when faced with low prices. The clearance floor of a furniture discounter was emptied in a flash with rather routine price discounts. Super markets can't keep particular products in stock when they go on sale. Some items remain off the shelf for weeks. Packages and contents get smaller. A popular item goes on sale one week with a seldom seen discount and the store stock is wiped out for a couple of weeks. When the product reappears the package is smaller, or the price is higher after the store and distributor inventories were cleaned out by the sale. It is not a "normal" price creep, it is inventory convulsions: emptying driven by interest costs on financing of inventory, followed by aggressive bidding (and asking) for new product once inventory is cleared.
The actual crack-up looks different, since people are indiscriminate in their buying. Their spending as a proportion of income grows, and fine jewelry becomes a rather popular avenue to getting rid of money. The quality of goods one is willing to accept goes down as a nasty cheap item is better than none.
Sir ORO,
Thanks for a look at current conditions in mainland China.
We have a mainland Chinese friend in town, here where I live in the U.S. that informed us her family was "Buying" a house and land in mainland China. I was under the impression everything in China was "Owned" by the state'she said times were changing over there.
May I respectfully ask where have you gathered your information about China? I sure would like to visit there!
Post 46844 reminded me in some ways of what I heard conditions were like in the 1930's & 1940's here. As you know during the 30's & 40's a massive immigration occured in the U.S.from the rural country side to the factories in the cities,because of economic conditions and WW II. IMHO the masses(offspring) gained and are enjoying, for some, somewhat better living conditions now than before,"BUT,"they sold or gave up or were forced to sell their wealth producing LAND.
We have the potential for a very dangerous situation here(in the U.S.)should conditions ever get as bad as the 30's,,,,when there was high unemployment. An estimated 90% of Americans live in cities and surrounding areas,,,they don't have the space or know how to grow food!!!Add that to this fuel shortage!!!Enough depressing thoughts!!!
Sir Shifty if your out there, I'm down to 3 chickens from 12 chickens and 2 roosters last year at this time. Racoons...3 different ones at different times...2 are in the promised land and the 3rd hasn't been back in a while.My wife's real good with the 44 magnum, except she almost blew the chicken coop apart.
Those in the Know are Buying Gold...beesting.
I know you genuinely wish to know what, if any, particular writer, or writers influenced my views in the areas often discussed, by me, in this forum. However, I am not quite so sure of the motives, though I will assume, as a fellow knight, they are honourable (honorable).
You will, no doubt, think I am being evasive again when I say that there is no single book, or author that has made any particular impression on my thoughts and beliefs.
My knowledge has been gleaned over years reading snippets from this book, and that book; this article and that article, and listening to, and taking part in, discussions between people I felt worthy, in and out of Academia.
When I have been abroad working, I had access to books which I found unavailable in the UK, or the United States, search as I may. I have spent hours in libraries and book shops skim reading.
Sometimes, like in a bookshop in Okinawa, I would find a very informative book with diagrams that showed a link, by detailing the family tree of a certain illustrious, and influential, banking family, with a broad spectrum of political leaders and heads of state throughout Europe, and the United States. There was other interesting information, but the book was in Japanese, and time only allowed my Japanese friend with me to translate parts.
I took down the details of the book thinking I would be able to buy it in English once I returned to the US or the UK. No such luck.
It is amazing how much information you can get from the obituary section for prominent people in the British leading press publications - Times, Guardian and Independent (what a misnomer), etc.
This is the best way, Sir Gresham - snippet here, snippet there. I personally avoid being hooked on any single author's philosophy though he be 'in tune' with mine.
As I mentioned in a previous post, I am not a Christian (that does not mean I am antichrist any of you emotional religious types) but I believe the very seeds of my belief are to be found within the pages of the Old and New Testament - particularly the new � before I go any further, in my studies of the 'philosophy of ideas', I also read parts of other books of religions and philosophies. Their teachings are all, in some form, embedded in modern political doctrines. And you cannot divorce politics from economics, and gold (real money) is the fulcrum of economics.
I regret I do not have time to spend on preparing, or editing my postings, so I sometimes find I have missed some point, or made an error that could be misunderstood. For this I apologise. I do my best within time constraints.
I do enjoy visiting the site, and reading many of the well put together, and informative postings. It is good to see what ticks out there.
May I leave you sir, with this thought � "An open book, is useless without an open mind".
Who said that? I, sir, and it is probably the most profound thing I have ever said.
Wanted to offer this to everyone to make sure my post was clear and not sending misleading info, so I will state this again to be sure. The numbers I posted were the positions in open interest and the changes to the size of those outstanding positions for the February and April contracts. Therefore, they should be interpreted as revealing the actions taken by the shorts AND the longs...in tandem. They come and go in pairs, and given the particular nature of this special game (as we've discribed here oh, so many times before), the shorts dictate and longs capitulate. The purpose of this public display of tomfoolery is exactly that same as served by window dressing in a storefront, but with an important difference. The storefront advertising WANTS you to buy the goods within. The COMEX action is content to merely settle for capturing your attention.
Try this: theoretically change the contract leverage overnight from 100 to something else... ten or up to 1,000 or 10,000 ounces per price betting contract....it will not affect the underlying metal market one bit even if open interest remains unchanged. There is no connection between the two. So even as paper sellers sell to dictate the paper buyers' capitulation, the biggest capitulators of them all are the miners and the weak hands who accept this window dressing as reality and deliver gold at such prices, thus confirming the reality FOR ONLY AS LONG AS THE GOLD LASTS TO SATIATE THE PHYSICAL DEMAND. A primary supplier of demand is the liquid gold which is out chasing interest returns originating from the countertops of the bullion banking sector. How overextended might they be, and what does history teach us about the lending of unprintable assets coupled with shifts in depositor confidence?
These things do not change overnight...until the night they do.
Foa/trailguide has been so wrong about many things, been rude at times, treated you all like children with his little walks in the forest, and yet you do all the apologising and beg for him to stay.
It reminds me of how otherwise intelligent people become involved in religous cults, there leader always has the answers, speakers to his followers in half riddles which they do not fully understand, and the leader always knows what is happening but is unable to fully share the information with the rest.
I have known deluded people, otherwise very intelligent to come up with terrific conspiracy theories which are totally plausable and almost impossible to refute.
There are great many minds on this forum, whose posts i enjoy reading and give me further insight. I am not one of those. My forte is that i can sort the garbage from the good.
So unless our beloved leader can give us some hard cold facts and time lines, rather than hiding behind the smoke sceen of "someday soon & things have changed", I say good riddance, adieu, bon voyage, but not before me.
And boy do i hate people who take insult so easily, or is it just a ploy to get more attention. Some people actually get off on that.
.........So, although the word "bounce" might be heard on Wall Street when the Fed cuts again this week, the words "dead cat" will not be far away...............
First off, I want to thank you for all that you have given this forum. I believe your motives are honorable and your words sincere. You come across as one of integrity.
I also want to convey to you that you have made a significant difference in the way that I now understand and view gold and the world's money systems. While not fully understanding your positions, I have learned a lot. I now read other postings in a different light, always trying to put them in context with the way you and Another present your case.
I now own physical gold due to your admonishments about the alternatives. I probably would not have otherwise.
Lastly, I say to you that I would be pleased if you reconsider your position, and continue to post here. In any case I wish you all the best the future can bring in these interesting times.
To get us a little back on topic, before falling asleep a while back my mind started to wander to what someone posted earlier about 1 ounce gold eagles being given face value by the Government, or confiscated if need be. Well this didn't sit right with me so I figured that a better way could be found. Right before falling asleep it hit me, "Paper Gold". What do I mean? Read on and find out.
A few days later I posted if anyone had any information regarding gold leaf and how many square feet one ounce of gold could cover and how thick. Nobody answered my question so I started looking. It wasn't until I got to chapter 22, page 139 of Michael Kosares book "The ABCs of Gold Investing" (BTW Michael thanks for sending this with one of my orders) titled "V is for Vital Statistics" that I saw a portion of my answer. Michael states, "One ounce of gold can be drawn into a wire about thirty-five miles long". Of course you didn't state how thick this wire was so I broke out my calculator and Excel Spreadsheet to do some calculations.
Anyway, I thought why not put gold thread or gold leaf within a note, thus you get to keep paper currency and have gold in a portable form. How would this work? Well let's break out our calculators and find out. (Some numbers have been rounded for easier calculation. My spreadsheet didn't round so I'll use its final calculations)
(10.2cm^3/gmol) x (1 gmol/196.9665 g) = 0.0518 cm^3/g
(0.0518 cm^3/g) x (31.103 g/ozt.) = 1.611 cm^3/ozt.
Converted to millimeters it's 1,611 mm^3/ozt.
Well 35 miles seems like a very small wire, and I was looking for ribbon instead so I did some more calculations to find a ribbon that would be visible, so I chose 2.0 millimeters wide and the thickness came out to approximately 0.001 millimeters. (I've got them in Excel format if anyone wants to see it.)
Miles of Gold ribbon = 0.5
Millimeters per mile = 1,609,344
Length = (0.5 miles) x (1,609,344 mm/mile) = 804,672 mm
Width = 2.0 mm
Thickness = 0.001 mm
L x W x T = Volume of one ounce of gold
(804, 672 mm) x (2.0 mm) x (0.001 mm) = 1,611 mm^3 (approx.)
What can I do with this info? Well, since a dollar is 2 5/8 inches wide or 66.675 mm you could put one strip or a number of them within a note to denote its denomination. I chose 2 strips at 2 mm wide for a $5 note, 4 strips at 2 mm wide for a $10, 8 strips at 2 mm for a $20, 10 strips at 4 mm wide for a $50, and 20 strips at 4 mm for a $100 note.
Here is what they may look like (ASCII isn't a good drawing medium so I'll represent an "I" as a 2 mm ribbon and an "H" as a 4 mm ribbon
:
$5 Treasury Note
-------------------------------
| I I |
| I I |
| I I |
-------------------------------
$10 Treasury Note
-------------------------------
| II II |
| II II |
| II II |
-------------------------------
The volume of gold in the $5 note would be approx. 0.267 mm^3 or 0.000165732 ozt. This can create approximately 6,034 five-dollar notes, or $30,170 per ounce. A $10 note has approx. 0.534 mm^3 or 0.000331439 ozt. This can create approximately 3,017 ten-dollar notes, or $30,170 per ounce. A $20 note has approx. 1.068 mm^3 or 0.000662928 ozt. This can create approximately 1,508 twenty-dollar notes, or $30,170 per ounce. A $50 note has approx. 2.670 mm^3 or 0.001657321 ozt. This can create approximately 603 fifty-dollar notes, or $30,170 per once. Finally a $100 note has approx. 5.340 mm^3 or 0.003314642 ozt. This can create approximately 302 one hundred-dollar notes.
If you didn't have enough change you could cut a bill in half as long as none of the strips were cut and it would be equivalent to half of that notes value. Just return half of a $20 note to the bank and it would then be able to issue you a $10 note in return. The cut piece would then be sent back to the Treasury to be remanufactured into a $10 note. Also, it would be a lot harder to counterfeit, since you can currently take $1FRN bleach it and then reprint it into a $100 FRN, making a $99 profit. Try passing off a $5 note as a $100 note and people would catch on quick since it didn't have the right amount of strips. Also, if grandmas house burnt down with her saving that were stuffed under the mattress, she could just send the melted ruins to the Treasury where they could find out approximately how much she had by refining the burnt notes and weighing the metal.
Now I took the U.S. Treasury of approximately 8000 tons, with a ton being approx. 32,150 ozt., and split it out into denominations.
$5 notes I gave 4,200 tons, which gave a created $ value of $4,073,742,507,499.
$10 notes I gave 2,100 tons, which gave a created $ value of $2,037,024,000,000.
$20 notes I gave 1,100 tons, which gave a created $ value of $1,066,932,561,488.
$50 notes I gave 500 tons, which creates $484,969,346,131.
$100 notes I gave 100 tons, which creates $96,993,869,226.
Add them up and you get $7,759,662,284,343 which should be plenty of money to float around. The Treasury could issue these notes to the people in return for FRN, then it could return the FRN to the Fed to pay off the debt and finally rid us of them. The Treasury could convert 5FRN:1TN or 10FRN:1TN conversion or 1FRN:1TN if you like.
Now, if you notice the approximate $30,000 per ounce that FOA quotes I'll tell you right now it wasn't intentional. It just happened that way.
What about confiscation you might ask? Wouldn't happen. The Treasury could pay individuals the $30k per ounce if they wanted to turn them in minus 40% for tax and you'd still make out pretty well. One dollar notes could use strips of silver and $1 coins would have to have the same amount of silver as the paper dollar. How much silver per dollar, or how wide would the strips be? I don't know I haven't done that calculation.
Harmony joins platinum bandwagon
Stewart Bailey
SOME MINES JUST WON'T PLAY DEAD FLY
January 30 2001
Johannesburg - Harmony, the
unhedged gold producer, said
yesterday it had discovered a
platinum bearing orebody near
its Kalgold deposit in the North
West province.
Bernard Swanepoel, Harmony's
chief executive, said
platinum group metal minerals
had been discovered during
Harmony's exploration for
gold in the region.
He said the current platinum
bull market, which
showed few signs of abating,
had justified Harmony's decision
to divert from its core gold
business to investigate the
potential opencast prospect.
The potential move into
platinum was not unique for
the gold producer, after rival
unhedged gold company Gold
Fields began firming up its
participation in platinum
mining in Finland last year.
Swanepoel, however, was
cautious in his assessment of
the deposit and said the company
would not tackle the project
on its own. Harmony's adviser,
JP Morgan, was to find a suitable
partner with the requisite
platinum mining expertise to
assist in the assessment and development
of the venture.
"If this thing turns out to be
a dream asset and makes a lot
of money, I'll be looking at
which gold mines I can buy
with that money," said
Swanepoel.
Despite poor cost containment
for the December quarter,
Harmony managed to deliver
earnings of 107c a share, compared
with 106c a share for the
September quarter. It also posted
a 50c interim dividend.
Joachim Berlenbach, the
gold analyst at INGBarings,
said flat earnings were disappointing
in light of the weaker
rand. Despite lower cash operating
costs at Evander, he said the
mine had failed to reduce its
target unit costs to below R300 a
ton for the three months. The
mine's unit costs for December
were R303 a ton compared with
R297 a ton in September.
"If the grades at Evander
can't be sustained then it could
look bad again next quarter,"
Berlenbach said.
Cash operating costs across
Harmony's mines climbed
from R212 a ton average for the
September quarter, to R222 for
December.
Revenue came in at
R1,085 billion, up from
R1,055 billion for the September
quarter.
Swanepoel said the higher
costs were caused by the company's
lower milling volumes,
as it sacrificed throughput in
search of higher grades.
Harmony closed R1,50 down
at R37,20 yesterday.
Hello All. Not to bring up a sore subject, but it is best for me to make a few comments before joining C.M. on "sabbatical". Our Forum got a little chaotic these last couple days to the detriment of all. Please allow me to pass along some of the lessons I have learned from this time, hopefully to the betterment of the entire community.
1. Be EXTREMELY cautious when even remotely suggesting the inadequacy of another member's post/work. It is fair to say that we all put a gread deal of effort, time, and attention into what is placed on Forum {even the smart alecs}. A little bit of ourselves is appearing on page offering up a degree of vulnerability. Mea culpa, and I hope my apology has been accepted.
Along these same lines, we all "gloss over" various posts as who can read them all? There is no need for an announcement that this has transpired, what good can come of it? Some things are better off left unsaid.
2. I trust we are not engaging in some form of Forum "correctness" as to the topics appropriate for discussion. I wholeheartedly defend the TOPIC of drugs and gold. If such animal exists all of our investments may be influenced by this factor. If it is nothing more than history it is still important. Ignore it at your own peril. It is every bit as apropos to gold as natural gas, the election, whatever. Much MORE gold related than a lot posted here. Michael seems to allow a wide lattitude of thought and learning and that is certainly to his credit. Let's not stifle ourselves. If you are not interested a simple glossing over or ignoring will solve the dilemma, others very well may be.
3. A few names get tossed around; "lemmings", "kooks", "smart alec". It's ALL the same; stooping to levels that are beneath us.
This is a special place and The Wiz is to be commended for his expression of his honorable motives that so many of us can relate to. Thank you, Sir, for your levelheadedness and your long term view. This "foodfight"/
"hatchet job" will also pass.
Godspeed to all. auspec
Sometimes you just have to accept people as they are, as long as they don't seriously cross up what you need to do.
Internet is like the old Wild West. (Did everyone really wear guns around all the time? Just so's they don't fire 'em off within town limits.) You also had to be REAL polite gettin' in conversations with strangers at the saloon, and you also heard Marshall MK say a few times: "Keep that holster buttoned, mister, while you're in MY town."
Thanks Pandagold, for the LBMA date: 1987. Now I want to know what gold exchanges were operating during the 1980 peak and subsequent tail-down of price. Another/FOA cite that as part of the dollar preservation scheme, but maybe such markets weren't needed until later?
Motive?: To keep the forum as a good place for learning exchanges? To help an energetic individual poster be more effective, without compromising his security concerns.
Like you, I love browsing, reading, and researching. Endless curiosity. Keeps us young.
Individual motive: Retirement, someday. I spent enough years studying IRAs and other tax-related retirement schemes. This looks like a better shot at it than paper investments.
Also, as a financial consultant, being able to warn clients who will listen about events as they develop.
tg, This forum is used to discuss Gold and related matters. It is not considered good form to attack someone personally just because his ideas don't jibe with what you think. FOA/Trail Guide does not need me to defend him. His body of work on this forum is well able to do that. I suggest that you read his posts and attack his ideas with all the facts that you no doubt have at your finger tips. We will all listen and judge your ideas on their merit. You are way over your head. White Hills
Now I see what was wrong with my post. I thought it was the calculations, but it's the ASCII drawings that didn't show up like they were drawn in Word. The $50 and $100 notes should have more strips shown and they should be spaced apart and not all gathered together like they are shown. Oh well, I tried.
The old saying "History repeats itself", whether in the stock market, booms and busts, gold, silver etc., or in real life drama, history has a way of repeating itself as well.
100 years later, 50, 8, or 2 years later. It makes no difference. It has a way of sneaking up on us. Sometimes, it isn't the exact day, sometimes it's a week, month before or later. Sometimes are emotions get raw for no reason, sometimes it's because we are still trying to defend ourselves or someone we loved and cared about. Sometimes it's the timing. FOA, it's the timing for you. It's okay,
your human. Your buttons were pushed, and I'm not even sure you put two and two together at this time. For the rest of the forum participants go back and read 11/23/98, 20:23:51MDT, Msg ID 1067 then read 3/14/99 11:17:14 MDT msgID 3351 and then read 2/2/00 7:47:43 MDT msg. ID:24106.
Exact scenerio, different year. Why? Because it is life!!!
Remember time heals (and you do need lots of time, as in years) but you never forget. I have my feelings on the "life" of Another but I'll keep them to myself until the time is right. FOA, I read your latest Gold Trail update.
No need to cool off. Just keep posting. Consider the source as well as where you were at the moment. Don't punish
the forum participants or yourself (your enjoyment of teaching) for the few who got under your skin at a bad time period in your life.
In Christs Love
Jayne
Your calculations were really interesting. Seems to me that we could accomplish the same thing by merely printing a "gold reserve note" that could be redeemed for its face value in gold. With the current POG, granted no one would be smelting the notes for their gold content! Your counterfeit protection and destruction of notes points are good ones. I think counterfeiting concerns will be alleviated greatly (temporarily) by the new style bills that are now being circulated. I think the new bills are just a ploy to cancel out all of the non taxable US currency at home and overseas. I wouldn't be surprized to see a different US$ for overseas usage soon.
Return to sanity. This is worth repeating.
I also read parts of other books of religions and philosophies. Their teachings are all, in some form, embedded in modern political doctrines. And you cannot divorce politics from economics and gold (real money) is the fulcum of economics. "An open book,is useless without an open mind."
IMHO. Understanding this will answer many questions.
MOST ENLIGHTENING. MOST PROFOUND.
FOA, My personal thanks to you for the years now of reading your Posts on this forum. You are one of the reasons that I read here every day. It seems to be human nature to attack someone who presents new ideas. The examples in history are too numerous to count. Sort of like shoot the messenger if you don"t like the message. To me you have shown the way and many of us will follow not because of what you say but the truth of what you say. It is now clear to me the nature of the economic war being waged as of this minute. To predict a certain outcome does not mean that you have to all so predict the timing. I suggest that conserving your wealth by accumulating gold at these prices makes more sense that somehow trying thru paper gold transactions to make money and at the same time risking all. Another has said the paper will burn and I agree. Regards White Hills
Randy (46859).
Agreed. You could probably change the number of ounces in a gold contract and half the traders wouldn't notice. Doesn't matter. Doesn't matter what they're trading either, corn, gold, index numbers or pork bellies. Maybe we could get approval for USAGold Ponzi number futures and options?
Of interest, of 66 different items traded as listed by "Consensus" the largest short position of 52.33% is in gold.***Japanese yen is next with a 37.02% of O.I. short and cotton is third with 29.86% short. These are positions held by the fund money managers.
All commodities have a huge surplus of contracts as opposed to physical traded. This is so transactions can be made anytime. ** IMHO the huge short position in gold bears watching. Get your physical or paper position or both while you can! IMHO and not trading advice!
Rich
I was reading some of the ANOTHER quotes the last few days. I recall the often used quote "oil bidding for gold". What does this entail? I remember FOA mentioning a few times that the increase in POO was not necessarily demand related. Is the increase in POO a reflection of a perceived lower value of the USD as opposed to 'higher' oil?
"Anyone can interpret any message as they wish and bend it to their own purposes -- or to justify their own actions, good or bad. It takes a higher order of intelligence to put aside your own prejudices and motivations in order to understand the real message." -- MK
"An open book is useless without an open mind." -- PG
Hang Fung Gold Technology, which opened a HK$200 million jewellery showroom and museum in Hunghom for tourists yesterday, plans to replicate the concept in Taiwan and Singapore.
ANOTHER 'SCUMBAG' GET HIS COMEUPPANCE
(it shows how hardfaced these guys are - to think they would greet him with open arms)
Threats force Soros to cancel speech
United States financier George Soros has cancelled a planned speech this week after threats of disruption and legal action from Thais who blame him for triggering the country's 1997 economic crisis.
ORO - thanks for the response. Yes, Russia has definitely reached the crack-up boom state. It will be interesting to see if the state is able to regain the control it once had.
The reason I bring up the topic is the fact I have several friends that are converting their cash into antiques and art via the e-bay auction site. They claim it is becoming difficult to obtain "good" merchandise and even the poor quality stuff is commanding ever higher prices. A couple of other friends trade in the firearm market and are seeing similar action. All have heard talk of "locking-in" value while they can. This differs from the attitude a few years ago of pure speculative frenzy; at that time most were trading their merchandise where now the best merchandise is becoming unavailable. These people certainly feel the money is going bad.
http://wilkes1.wilkes.edu/~phildept/epictetus/Greetings to Trail Guide and the Nights and Ladies of the round table. Many thanks to MK and Randy for all of your special work. Best wishes to you all.
Trail Guide please don't forget the many lurkers who need a different view or an expansion of their current reality. Darn, you finally brought me out of my lurking.
Enclosed is a link to Epictetus whose writings are dear to me.
Concepts have been within my reach in the past. My timing has usually been too early. How could anyone criticize someone for trying to give others their best estimate or insight on such a major change? Change is coming. When, who knows. A buffer certainly will not hurt as the dollar corrects. It appears to me that gold is the best insurance policy. Pre 33 even better. Thank you MK for the assistance. Best forum and the best place to purchase.
I once met an individual who exposed me to new information. Information beyond my wildest reality. I did not know whether he was crazy or whether I was crazy, but I was willing to keep an open mind. Later I found that neither of us was crazy. Just beyond my current reality.
Black Blade, many special thanks for all you have shared. This is and has been an area where I have little knowledge. Your postings have been greatly appreciated.
The last three homes I built have generator backups. Long before y2k. This costs me 1/4 of a percent on a 200k home. A 5k runs all critical systems and various light. Simple passive solar (window and home placement) have reduced the heat cost on the current home by 75% over the previous home. Plans are currently underway on the next one. Another blend of passive solar and hydroponics into the living theme. It will be great fun. Chompin to start.
TrailGuide may your garden grow beyond your wildest imagination. Mine most certainly has. I have visited hydroponics facilities with tomato plants averaging 25'. Currently, I have to hide all scissors, clippers, and shears, ECT from my wife on the research.
I had breakfast with a friend of mine Sunday. One of his
brothers-in-law, after graduating from McGill, went to work as an
attorney for the Marine Corps. Yea, JAG time.
I happened to mention Canberra, and my friend told me that's
where his brother-in-law was currently stationed. Further, he
told me, he was specializing in "Space Law."
A few of us once had a run-in with Murray Rothbard over the LP
plank addressing "Space Law," and though that was something like
twenty years ago, I was curious enough to try and find out if
they had taken things as far as we feared.
They have. It turns out that they've consigned the problems for
TPTB inherent in the internet to "Space Law."
SO - - - for those of you who recognize what a force for freedom
a free internet, free to encrypt in particular, is, you should
keep your eye on "Space Law" to keep track of what they're trying
to do to that internet freedom.
I believe the concept of "oil bidding for gold" is the idea that the world wants/needs oil while OPEC wants/needs gold But the buy-sell transactions are done with dollars--So, to purchase cheap oil it became necessary to provide cheap gold. If the POG were expensive, then the POO would have to be also to purchase the gold. So, the theory goes, efforts were made to "cheapen" the price of gold.
The dollar is just the means of exchange. Think of buying oil with gold but the exchange (amounts of each) is determined in dollar amounts. Hope this helps.
Look what's happening here. I'm a simple concrete mason and wannabe commodity trader and now I'm talking the economics of gold for oil. Must have something to do with an open forum (book) and open mind. Thanks to all
Rich
Oh-oh,looks like we got ourselves an aspiring Rubin wannabee.
Treasury secretary Paul O'Neil quoted at his confirmation hearing;
"It does seem very, very clear that Secretary Rubin was right in retrospect.I hope when my Mexico occurs,you will give me enough freeboard to do the right thing that seems necessary to do because,I think,if you had prevented Secretary Rubin from doing it, the consequences would have been really serious"
excerpt from Jan.26 Washington Post, story entitled;Overseas Bailouts May Split Bush's Team.Thanks to safehaven. com for the link.
Hey,maybe for a little change of pace,Mr. O'Neil's Mexico may occur in a certain commodity market.
The '93 down move ended in March...historically, this is a great time for gold to bottom.
Now, I realize the paper markets set the price for gold...
I also believe the market is now rigged against higher prices.
However, look at the chart above...
The horizontal line is current support (and resistance from August '99.
The lower diagonal is from 1996 - the beginning of the current bear move.
The upper diagonal is technical resistance from October 1999. All activity since is backing and filling, imo. The move off the bottom was too much, too fast....and of course, JPM and others loading up with derivitives doesn't help.
Notice we popped above resistance very quickly a few weeks ago and then were pushed back below the line. That breakout line is where traders will enter on a CONFIRMED breakout (much to the consternation of the shorts). Notice also the compression...the breakout line continues to fall in price.
The time is quickly approaching when either current support fails, or the upper resistance is taken out.
Having followed the charts on gold for some time now, I would not surprised to see support break first...but with today's heavy short positions as reported in the COT, I'm looking for a breakout above resistance even if support fails.
We talk alot about physical gold here and how the fundamentals are not reflected in the paper price. Understand, however, that as far as MOST people are concerned, the paper discovery method is all there is...it can't be discounted. If it could, MK and other dealers would be selling physical for much more than they are today.
Anyone who is concerned about hedging and owns shares in Eldorado Gold might want to look at the latest news from the co. They have effectively hedged 100% of thier mines output for the next 2 years. The co. also restructured their debt with NM Rothchilds. I know the VP of finance and will ask him about the details. If anything juicy and(allowable) gets revealed I'll post it. They presently output approx. 500,000 ounces, with 2 huge discoveries in Turkey in the reserve modeling phase.
Ps. Anyone interested in a well managed PGM situation should look at Geomaque. TSE:GEO Have optioned what looks to be a large open pit potential in Ontario. Far ahead of most juniors. And lots of experience in management.
I'm a couple of years out of date for "on the ground" info from Russia, but I think what holds that country together is that dollars circulate as widely as rubles. They've got $100s right down to $1s - - and even change sometimes!
No one wants to hold rubles any longer than absolutely necessary.
Indeed there has been a marked decline in the quality of stuff brought to antique shows and one of our favorite hunting grounds is near empty. The lowliest of shops still had a few good things back in 1995-6. Now the high end shop with the best stuff looks to be scraping the bottom of the barrel. Talked to proprietors in 3 states over December and found them all complaining of there being no more merchandise worth having. The are bidding mediocre stuff up just so that they can have something to show in the shops.
One person we know has just filled his third building with antiques (medium-high grade). Art brokers are talking of a strong market in suitcase size contemporary art.
By the way, the description I gave was of our fair Midwestern city, not Moscow or St Petersburg. I just put the caption on for fun, because you had asked about Russia and it did sound like post Rubal rubble Moscow. I have done little research on Russia and only know that the oligarchs are sharing control with the generals and the secret services. Economically, Russia seems to have bounced off the bottom, but is not growing well, particularly because of a lack of public understanding of how private property works. Those that do understand either work with the oligarchs, are too small to matter, or have fled the country.
I have been tracking China for 20 odd years through business zines, the WSJ, Barron's, personal acquaintances, alot from Busy (week) - who had run an interesting set of articles over the past couple of years, a good one just a couple of issues back. Also the regular 'zines like Time, and lots of internet news.
It's not a big problem finding info anymore.
Re houses. The Chinese government started selling people their appartments and houses, allowing banks to lend to home buyers, and allowing home buyers to own real estate. The reform date back 3 years, "experiments" date back much further.
Earlier today Randy mentioned that the specs have rolled a good part of their shorts from Feb. to April. They still need sellers to complete this move. Maybe, GATA can explain to the mining companies that a lack of willing sellers is what causes short squeezes and higher POG.
Whether this month or next or the following, as long as that huge spec short position exists, the potential is there for the explosion. What will be its cause and/or when, I don't know that anyone knows. I do know the potential is there and one that size is most unusual.
I'm somewhat amazed that the funds are in this position with what seem to be a more than usual amount of doubts as to where this economy is going. There are more financial advisors (not just goldbugs!)talking of precious metals than I've ever seen. Also, new administration and Fed. policy changes and general sense of "which way for the markets (equities) make this fund short position look risky to me. I would love to see them forced to cover-- around $350-$400 would suit me just fine.
Steve Forbes may have an ear in Washington. He's looking for about $350 or so, or so he says!
Rich
Thank you USA-GOLD for the opportunity to post on this outstanding forum! Recent events have pulled me from silence. Trail Guide, You are truly an astounding man! You have created the possibility for me and probably countless others to live a life of potential financial freedom. everything I have learned from you others here has inspired and changed my life from a long time paper slinging commodity trader into a solid gold wealth collector. If we are wrong and POG drops to zero, I say bring it on. I will have lost nothing but paper and gained insight, responsibility and wisdom from your teachings and still have a golden walking stick. I hope to meet you on the trail soon.
Hey guys - I guess I'm on the lookout for the change in attitudes out there. This energy price increase has seemed to capture everyone's attention and I'm looking for that point in time when people decide the price increase is here to stay and more may be on the way. Although people may not immediately determine it to be a money problem, subconsciously they grasp that having something in hand is better than not and change their buying patterns. Once they start looking for signs of inflation, and more importantly discussing with their peers the subject, the realization that inflation is accelerating sets in.
Looking at Human Action, Mises states that any bank has two rules they must live by to retain trust;
"First: It must avoid any action which could make clients - i.e., the public - suspicious. As soon as clients begin to lose confidence, they will ask for their deposits". (Of course, today this doesn't actually matter as deposits are not necessary for banks to operate).
"Second: It must not increase the amount of fiduciary media at such a rate and with such speed that the clients get the conviction that the prices will continue endlessly at an accelerated pace. For if the public believes that this is the case, they will reduce their cash holdings, flee into "real" values, and bring about the crack-up boom".
I question the huge increase in the money supply going "unnoticed" by the average Joe out there. My friends have certainly started to grab whatever they can whether they understand it to be a problem with the money or not. We seem to be right on the edge of awareness.
Anyway, I guess we'll see if the Fed can successfully step around this under-investment, over-investment problem they've created. I think they would have a better chance had the under-investment been in something other than energy production and delivery. I think it will be difficult to retain confidence in the face of the extended period of time it will take to rectify the situation.
Hey again - this Russia situation has captured my imagination. I can't seem to let loose of the idea that if there is one place in the world where money can be made, it is there. I like the idea they've defaulted to the West, the natural resources are abundant, capitalism is starting to take hold if still more or less centralized at the moment, the tax system has collapsed, but most importantly the young people there have been set free. It will be the last place on Earth where another revolution will take place. I'm considering doing some recon as to what types of opportunities might exist on the "ground" over there. If only I was 25 again.
Black Blade: Re: the Miningweb and other reports of power prices or profitable sell-offs of power shutting down mines. Do you think you've located another Horseman? (When did we last count those anyway?)
Black Blade: Maybe it should be categorized with oil? Maybe energy should be an all-inclusive category for a "Horse Man." I know that we will be hearing more on how the costs of energy will affect the natural resources sectors. Perhaps those that are hedged and therefore locked into a price of forward production may not look so smart before long. I know that Barrick for example had touted how they save energy costs (fuel) on their mine vehicles at their Elko, NV operations because they use a "trolley" system to pull their mine trucks up the ramps. Too bad that this requires "Electricity!" How times change. Some mines will simply shut down, as they are marginal in the current price environment.
ORO (01/29/01; 14:30:21MT - usagold.com msg#: 46844)
Black Blade: I agree completely. I see essentially a repeat of the 1970's stagflation scenario, though caused by a few different circumstances (i.e. energy crisis caused by Arab embargo, vs. energy crisis caused by lack of planning and misplaced environmental concerns). If history is a teacher, then we should see a repeat of the past. Every postwar recession has been preceded by an energy crisis, why should it be "different this time?"). As discussed here before, money supply continues to grow for example. The energy sector has come full circle again as you describe. We can't import oil to extricate ourselves this time, it is a "home grown" problem this time. As this problem intensifies and becomes more obvious and prices continue to rise, there should be a move toward hard assets in an attempt to "preserve wealth" and use up those depreciating dollars � which is good for precious metals. BTW, until about 3 months ago, Cheeta (AG) was spouting off about how energy is not as significant to the economy as it once was. Last week he changed his tune and discussed how the energy crisis is a threat to the economy. Well � Give that chimp a banana!
RE: Hydroman,
Welcome to the forum. Your approach to housing sounds a lot like what Dennis Weaver (actor of "McCloud" fame) has done in Colorado. He built an energy efficient home into a hillside using recycled materials. He used a south facing exposure for natural lighting, used tires to retain latent solar heat, solar panels, thermal windows, etc. I hope that some day I will be able to do something similar. Though I move about a lot due to career choice, and I live more like in the 1800's than the year 2000. I have minimal electricity though and a radio phone link. I will likely be moving on to other digs soon though. As far as hydroponics is concerned, I have a good friend who has a "garden" and he's not growing tomatoes. What can I say, he's a child of the sixties. I barter home brew and fire wood for veggies and eggs from his outdoor garden though. See, I really do get along with all types ;-)
Dear F.O.A you don't need to cool off, because you are already COOL!!! in my books. :-) Thanks for you being you, I wouldn't want you to change one bit.
P.S "Tomorrow never Dies" I also know the "metal" your made of,you're so much stronger than all this (Big Smile)
I found this post on another site (petroleum downstream ventures). I thought it to be of interest here � Black Blade
Adam Zagorin/Washington
January 22, 2001
Web posted at: 1:12 p.m. EST (1812 GMT)
There wasn't a lot of tension at Spencer Abraham's confirmation hearing last week. George W. Bush's pick to head the Energy Department is a shoo-in. But one uncomfortable moment came when Abraham refused to say what the new Administration would do about California's electricity crisis. That prompted Frank Murkowski, chairman of the Energy and Natural Resources Committee, to growl, "You better have some answers."
What will Bush do to keep the lights on? He doesn't have a lot of options. Last week he ruled out new federal controls on wholesale electricity prices, which Governor Gray Davis had proposed as a way out of the mess. Bush also nixed the idea of bailing out the state's nearly bankrupt utilities. The Los Angeles Times compared his position with President Gerald Ford's 1975 refusal to rescue New York City from fiscal default, "a decision memorialized," the Times noted dryly, "by the tabloid headline: FORD TO CITY: DROP DEAD."
Most energy experts agree that beyond playing mediator, Washington shouldn't step in. Instead, the White House apparently plans to take aim at federal environmental regulations that, Bush argues, limit power supplies by keeping plants from running at capacity. But taking on the green lobby could use up valuable capital at a time when Bush wants to press his domestic agenda. And his big problem is more basic: his energy policy is mostly just an oil-and-gas policy. He wants to use tax credits to boost domestic oil production, and he has a 10-year, $7.1 billion plan that includes drilling for petroleum on 1.5 million acres of protected Alaskan tundra in the Arctic National Wildlife Refuge. But those ideas--the second one hugely controversial--would take years to have an effect, and even then wouldn't ease the electricity crunch. Bush's goal of eliminating regulations that impede the construction of refineries, pipelines, plants and transmission lines would help someday, but it won't be any easier to get through Congress than his scheme to drill in the Arctic.
Bush's senior economic adviser, Larry Lindsey, has the task of figuring out what to do about California. One stopgap: renew the Clinton Administration's order that power and gas companies across the country transfer their excess capacity to the Golden State. But diplomacy may be the most effective arrow in Bush's quiver. He plans to place energy on the national-security agenda and lobby OPEC to pump more oil. Although the cartel last week announced production cuts, which pushed prices higher, some key members, such as Kuwait and Saudi Arabia, remain grateful to Bush's father for winning the Gulf War. Will they help the son?
For consumers, Bush's laissez-faire approach is likely to be painful. The new President backs hundreds of millions of dollars in extra funding for an energy-assistance program to ease the burden on the poorest Americans. For everyone else, high prices could be around for a while. The clearest indication of that came from Kenneth Lay, the chairman of Enron, the Houston-based energy giant that is the nation's largest power marketer, with a major stake in California. Last week Lay warned that California would have to resolve a "pretty much self-inflicted problem"--even if that means price increases for consumers.
Lay is a Bush family friend and a member of W.'s energy transition team. Enron and its officers contributed $300,000 to the Inauguration; the company was one of the largest contributors to Bush's campaign.
The betting in Washington is that Lay's policy will be national policy.
--By Adam Zagorin/Washington
Black Blade: Interesting take on the Kalifornia situation. I don't wish to sound too cruel here, but for paraphrase Marie Antoinette "Let them freeze in the dark." They need a little "tough love" or else they will never learn from their mistakes. When voters in the western states overwhelmingly voted against Bubba in both the 1992 and 1996 elections, he got revenge by confiscating huge tracts of land for Federal government ownership thereby depriving them of school trust mineral rights that fund education and infrastructure in each of these states. Why shouldn't George Dubya do the same? He lost big in the People's Socialist Republik of Kalifornia and is very unlikely to win there in the future, and yet by turning his back on them he can solidify his base of support elsewhere by not depriving other states of their dwindling energy resources. Just a thought and probably a good political strategy.
You know, I really like lurking and following the commentary and occasional "brew ha ha's" that pop up. I rarely have anything too profound to post and when I do......well, let's just put it this way, I've never made it to the "Hall of Fame". No matter what, all I care about is......WHY IN THE HELL IS MY PHYSICAL CONTINUALLY LOSING VALUE?
I can only can only be thankful these people who want to lock in valve in antiques haven't discovered what I've discovered.
I work in computer and thought I would have to learn a new trade because of y2k. As I improved, I want to improve my "tools" and wanted to get some tools made in the good old days. Imagine my delight and surprise when I found out my "tools" have about 2 to 3 pounds of silver. At todays prices they would sell for 160 to 240. However I am getting them for around $120 or so. Part of the reason is nobody realizes these things are made of silver and so they escaped the great melt down of the 80's. Second while they can be works of arts people don't valve them unless they want in my new career. And these craftmen buy them because they are really good tools. I don't think they are aware of the valve of the silver.
Well, I am not going to tell you what these bargains are, I am letting you know you can find bargains in antiques and in silvers even
ORC in a message date 1/29/2001
> The reason I bring up the topic is the fact I have several > friends that are converting their cash into antiques and > art via the e-bay auction site. They claim it is becoming > difficult to obtain "good" merchandise and even the poor > quality stuff is commanding ever higher prices. A couple > of other friends trade in the firearm market and are > seeing similar action. All have heard talk of > "locking-in" value while they can.
> This differs from the attitude a
> few years ago of pure speculative frenzy; at that time > most were trading their merchandise where now the best > merchandise is becoming unavailable. These people
> certainly feel the money is going bad.
[Walter Youngquist is the author of GeoDestinies.]
Walter Youngquist
Consulting Geologist
Eugene, OR
6 January, 2001
Governor Gray Davis
State Capitol
Sacramento, CA 95801
Dear Governor Davis:
Relating to the California electricity supply problem, as a consultant to a public electric utility for 19 years on energy supplies, and as a petroleum geologist for some 40 years I would like to offer some comments, which I hope may give you some additional perspectives on the present situation in California. And what the future may hold, with regard to energy supplies.
Natural gas is the most critical in the sense that it cannot be imported in any quantity - it is a continent-by-continent situation. The U.S. does not have enough gas for its own needs. Our only other supplier is Canada. I addressed the Canadian Society of Petroleum Geologists in Calgary last June and we got into the natural gas matter. They now send us 60% of their production and are not sure they have much more to send. They are drilling more and finding LESS PER FOOT DRILLED - this is the clear mark of a mature and declining petroleum province.
In our own Gulf of Mexico, where the remaining big gas reserves lie, the annual depletion rate is running as much as 27% - in a few cases as much as 50%!
California has electricity supply problems. Most of your power for electricity generation now comes from gas, and you are building more gas turbines. But where are you going to get the gas? We in the U.S. are not self-sufficient, and Canada's ability to supply increasing amounts of gas appears to be very limited.
Energy is the very lifeblood of our economy, and natural gas and oil in total are our chief energy sources. The U.S. is not now self-sufficient in either, nor will it ever be again. I enclose some pertinent articles, by myself and others, on these matters, which I hope will provide a perspective on the energy problems.
And I want to add one more very important fact. In the U.S., all we are now doing on energy is playing "catch-up." The problem is POPULATION GROWTH! Here in the Northwest we have installed all the turbines, for which there is water to turn them, in the Columbia River system. We now have no surplus power, but the population keeps growing. Now what? There are two parts to this problem - supply and demand. Supply is finite. Demand curtailment is the only option. Demand = population. Conservation is simply a band-aid.
It is not a solution.
The U.S. Census reports that in the past decade we have grown 13% to 281.4 million people - and we add three million a year. We are now the third most populous nation in the world, right behind China and India. And we no longer have the resources to support our energy demands, much less take care of three million more each year!
California is expected to add 20 million more people by the year 2050. If this occurs, there is no way you can adequately supply the energy needs of such a population. Alternative energy sources simply will NOT do it! I am familiar with your wind, solar, and geothermal projects. I have seen and studied them all, and I have studied and written extensively on the topic of alternative energy sources (see enclosed papers).
With diminishing fossil fuel resources (and no comprehensive substitute in sight), even with only the present California population, in year 2050 you will not be able to adequately provide energy. With a smaller stable population, alternative energy sources might provide a modest standard of living. With a growing population (in the past decade California added more people than did any other state - 4.1 million), you are now faced with a chronic energy supply situation, which will only gradually get worse.
There is no possible way that we can ever solve the energy problem as long as we are shooting at a moving target - population growth. If this very basic matter is not addressed, all efforts to solve our energy problems are ultimately futile. I have addressed this problem to some degree in my paper, which I enclose for you: The Post-Petroleum Paradigm - and Population. Over the years I have made more than 500 speeches, and written several books and articles on the matter of the relationship between resources and population, but there has been little heed to what I, and a few others, have said. Now this is becoming critical.
I sincerely hope as we begin to have our backs increasingly against the energy wall, that you and others in visible public positions will begin to address this matter in ALL its aspects, and the underlying problem to it all is population growth. That MUST be addressed, otherwise all other efforts are ultimately futile. I am greatly dismayed that with all the rhetoric and wringing of hands concerning this matter, no highly visible influential person in authority clearly cites this fundamental problem of population. People use energy - more people - more energy use. You will always be playing "catch-up" and never catch up if you have to shoot at a continually moving target - population growth. If this is ignored, then it becomes the fabled ostrich posture of head-in-the-sand. So far that seems to be the case, and is no solution. For this posture I quote Aldous Huxley: "Facts do not cease to exist because they are ignored."
Sincerely yours,
Walter Youngquist
Black Blade: I don't know this guy, but I like him already. I have written on the same subjects, however, this well written letter hits all the marks and I thought that I would pass it along.
http://www.gold-eagle.com/gold_digest/baron1020.htmlI've been reading through Red Baron's 1997 series today, on LBMA. He's got lots of Another excerpts in the 10-part series, but what struck me is the voice of "translation" is FOA's, the guy we know. I mean, this guy has been WORKING HARD for us for 3 1/2 years now. You think YOU'RE tired, frustrated?!? JFC, what does HE get to claim he feels like? IMO, the first response you do is Gratitude for that work, and the second you do is some homework so you can ask decent questions to help this along.
If you want to critique, you do even more homework. Like YOU call up LBMA and ask why their volume's going down, and what would happen if it dries up. Then YOU call van Eeden, and Kaplan, and FT (who is it? Calandra? no that's CBS) and ask the same thing. You find ONE THING you can offer in actual contradiction at the level FOA offers (yes, I know it's hard to get the Saudi oil minister to return your calls), or else you maintain a respectful silence.
I know this is hard stuff we're going after here, hopefully together, but you help, or you get out of the way. Click! There, I've vented. Enjoy the rest.
"Posted on the Internet October 9, 1997 by "ANOTHER"
"Gold is the only money the world has ever known" Sounds like a simple thought but it isn't.
"Money is whatever people say it is" Not true! "Currency is whatever a government says it is" True! "The LBMA problem" I can now make clear for all to see.
Background; to understand the following you must rethink your basic knowledge of money and investments. Get your aspirin ready. Some time ago gold not only was used as money but also circulated as currency. It had always been money and people had no use for a separate currency to represent "gold money" so they stamped the gold itself and used it as circulating currency. From the start, one thing most thinkers can't quite grasp is that "money does not have to circulate"! The first "world money", gold money that is, could stay locked up and still represent value and wealth. People had but to agree on who owned it in exchange for goods and services. You have all read the articles about how paper receipts for "gold money" were later circulated and became paper currency receipts, then paper currency, then just currency. The western world today, as we know it does not use money! They use "paper currency". To fully understand what that really means you must come to terms with this fact. "When you use paper currency you are placing a value using another persons concept of value" You are using a thought as a means of value! When an investment in stocks, bonds, bank accounts, CASH, businesses etc. is priced in US$ currency you are really holding the "intentions of providing value" locked away in the thoughts of another mind.
This type of human interaction works well for a time, as the last 100 years or so proves. But, it is highly unstable to say the least. It has it's own self-destruct code written inside each mind. One day (it has already started) a type of nuclear chain reaction will occur in the currency markets as people start "unvaluing" the thoughts of others. Little by little all debts owed will be marked down.
Now that we understand that concept let's move on: One of the great money troubles facing the western currency system today is that many third world people are starting to put a "mind value" on real money, gold. These people don't know the true value of gold money but they know it's worth a whole lot more than the world paper currency price now placed on it. And that brings us to the next problem; how can paper currency that represents "thoughts of a nation blowing in the wind" be used to value real money of ancient world class proportions, gold? It cannot! Any price you can think of will do, as in no price will work! How did we come to this unworkable mess? The best way to rework the publics mind about gold money was by changing the way it was viewed. "It's money of course but let's also call it a "commodity! Then we can place a "paper" value on it and denominate it in all forms of future contracts. It will lose it's true value as money in peoples minds and be priced in an unrealistic paper format." And here we are today! The banks must sell all the gold they have to keep the system together. And once it is all sold and the financial markets implode the nations will use "whatever force is necessary" to pull the gold back in! That action in and of itself would show the true value of gold money!
What of the LBMA mess?
Gold is cornered. Plain and simple. No complicated theories, no options problems. The commodity value of gold was forced so low in paper currency terms that all of the new mined gold, going out some 10 years is spoken for. Between the third world buying physical gold and the jewelry industry ( same people buying ) there is none left for the oil states! They do value oil in terms of gold, but not IN the paper currency price of gold! How much is gold worth in terms of oil value? Just stop supplying gold to them in ultra cheep US$ terms and you will find out by watching the currency price of oil! In any event, LBMA has traded so much paper/oil/gold that any rise in the currency price of gold will implode them. The CBs must become the full primary suppliers of gold or the system as we know it is done.
One last note: No form of paper wealth will survive the financial crush once the CBs stop selling! NOTHING!"
Yes, I really know that we need an enemy to keep us together, and keep us working hard.
And yes, I know that our enemies are manufactured for us to hate. Please don't think I dont know this.
When I talk about China, I am aware that they are a manufactured enemy, and we are being prepared to hate them, just like we were conditioned to hate the Japanese in WW2.
I really thought the Environment would become the new unifying factor of political forces. But I guess its not a strong enough rallying point, so we will still be fed traditional fear and hatred, which has always worked so well.
Just for the record, Chairman Mao of Communist China killed more than 80 million people, more than Stalin, Hitler, and Clinton combined. Funny how we dont hear much about that evil regime, but we hear about Hitler's atrocities ad infinitum. For every article about that demented pervert Hitler, there should be a required article on Mao, and it should be clearly shown that Mao was the greater of the two evils. What kind of warped perspective do we have, that only Hitlers evil exploits are blazoned into our minds, and very little time is spent of Mao, who made Hitler look kind of tame? Just funny how we are conditioned, huh?
Yes, Pandagold, I know more than my posts have admitted to, but I didn't want to cram too much of my ideas at one time into a post.
In my opinion it wouldn't work. The One ounce eagle contains copper as well as gold to harden the coin. How do you propose turning the coin into gold leaf. The only way I can think of without an awful lot of work is to have a train run over the coin like you would put a penny, or dime on some railroad tracks.
Actually, While I believe the day will come when government will try to grab any gold they can find, I think that are ways to prevent from being rob.
First, the less who know you have gold coins the better. What they don't know, they can't find.
Second, gold is so out of favor today, the average person does not recognize it for what it is.
I joined late and noticed there was an observation about gold and drugs. Let me give you my views
I live in the poor side of town and seen a lot of drug deals go down. I also seen cops shaking down drug dealer. Recently, I saw a dealer dealer with gold coins and cash getting shaken down. The cops took the cash. They left the gold alone because they thought it was copper coins. The dealer lied and said they were just good luck charms made of copper. I knew better. Sure, as someone said three one hundred dollars bills are a lot lighter and easier to carry but guess which item disappeared during the shakedown.
I don't know if this was an isolated incident or what but I bet that dealer told his friends what happened.
I also think this: If seizure of gold coins come, it will in the guize of the drug war. After all, gold is a barbarous metal. What use is it anyway? It would be easy enough if the government wanted to grab everybody's gold to fake a drug rage and along with drug and cash find some gold cash. GOLD FOUND IN A DRUG RAID!!! It has fallen below the level of a "barbarous metal" It is now "Drug Money!"
We can't aloud this! And before you know it they outlaw gold because it can only used for drug money. That is the way I believe it will happen the next gold grab. Probably won't happen for a year or two, but as with buying gold, so I give you this warning! "Better a year earlier than a day late! Gold will be seized as drug money. You have been warned!
> Anyway, I thought why not put gold thread or gold leaf
> within a note, thus you get to keep paper currency and
> have gold in a portable form. How would this work?
Thank you for posting the link to the Red Baron series. I had never heard of that, and it will make interesting reading! Seeing the old ANOTHER quotes is like hearing the words of an old friend. When I first started lurking/posting at USAGOLD, I spent many hours reading the ANOTHER "THOUGHTS!" section. ANOTHER's words were so radical and different from anything I'd ever seen before. I would stare at them, puzzled, and then glance over at CNBC, and try to reconcile the two! (That can't be done!) I can't say I fully understand it all yet, but "time proves all things," and it is surely proving the truth of ANOTHER's prophecy.
Trail Guide
As others, I also feel compelled to briefly come out from my corner to express my appreciation for all the knowledge and insight you provide at this valuable web site. You are the best. I have followed both you and Another since the days of Kitco and have read all your posts, most of them more than once. I have hard copies of all your postings that stack a foot high, a testimony for me anyways as to the great amount of time you have dedicated in the sharing of your thoughts with others. You have taught me a great
deal and I believe I will eventually be better off for it. I look forward to all your future posts as much as I have enjoyed your writings over these past several years.
PG
I know what you mean about cop shake-downs. I used to live in The People's Socialist Republik of Kalifornia (HELL) for a few years. I knew a couple of San Jose's finest narco-squad. They would joke incessantly about how they would raid a home and make off with drugs, jewelry, cameras, money, etc. They even explained how they would set-up people by planting contraband and lie in court. The whole drug war has done nothing but breed corruption in law enforcement and the justice system. I dared not say anything to anyone about what I know. These guys are tight and would do just about anything. The Rampart Division in Los Angeles has had a lot of bad publicity about police corruption, police murders, police crime, etc. I would not have believed it if I had not seen and heard of it myself. Who is worse? the crooks or the cops? In some places you can't tell the difference. We live in a strange world.
http://biz.yahoo.com/rf/010130/n30343775.html By Andrew Quinn
SAN FRANCISCO, Jan 29 (Reuters) - California has already burned through its $400 million energy emergency fund, officials announced on Monday -- forcing Gov. Gray Davis to order more public money made available to keep electricity flowing to the nation's most populous state. Mike Sicilia, a spokesman for the Department of Water Resources, said the funding Davis ordered less than two weeks ago to finance emergency state power purchases ran out Sunday. ``We're now acting under the emergency authority of the governor'' to secure more money, Sicilia said. He declined to say how much department money was being tapped. Davis, in setting his strategy for dealing with California's power crisis, named the Department of Water Resources as the state's agent in buying power that its cash-strapped investor-owned utilities can no longer afford. State legislators in Sacramento are racing the clock to come up with a rescue plan to deal with the crisis, which has this month twice forced power managers to order rolling blackouts across sections of the state. Meanwhile, the state Public Utilities Commission (CPUC) late on Monday released the results of one of two official audits into the finances of the state's two biggest utilities, which have both said they face imminent bankruptcy. The KPMG LLG audit of Edison International (NYSE:EIX) unit Southern California Edison concluded that the utility's crash efforts at cash conservation may have pushed back the date that the company would run out of money beyond the Feb. 1 deadline it had originally forecast. But it said the company still faced a grim situation with no remaining lines of credit available to buy the power its customers need.
GOV. MULLS HOW TO COVER UTILITY DEBTS
Davis, who is mulling a number of proposals aimed at using public funds to pay down the utilities' debt in return for some kind of equity stake for ratepayers, ordered the audits to reveal the true state of their corporate finances.
CPUC President Loretta Lynch said the other utility, PG&E Corp. (NYSE:PCG) subsidiary Pacific Gas & Electric, had objected to the release of information contained in its audit by the Barrington-Wellesley Group, but that she had decided to make this information public as soon as it was received. California's energy crisis stretched into its 15th day Wednesday with little sign of relief. Energy managers, who have ordered 14 consecutive days of top level power alerts in the state as reserves dip dangerously low, said supplies remained tight and officials in nearby states said they, too, were beginning to feel the heat from the California crisis. In Washington, President George W. Bush on Monday appointed Vice President Dick Cheney to head a federal task force to deal with energy prices. ``We're very aware in this administration that the situation in California is beginning to affect neighboring states,'' Bush said, adding that the imbalance between power supply and demand was quickly becoming a national problem.
California's problem is rooted in its 1996 experiment with market deregulation, which freed wholesale energy prices but kept strict caps on the prices utilities could charge consumers. While a lucrative arrangement for the utilities for the first several years, growing supply shortages this year sent wholesale prices skyrocketing -- and forced the utilities billions of dollars into debt.
THREAT TO HOME GAS SUPPLIES
While the electricity crunch has already hit some two million Californians who experienced two days of rolling blackouts, Pacific Gas & Electric warned on Monday that its financial predicament could well leave it without natural gas for its 3.8 million customers within a month. A federal order to suppliers to sell natural gas to the cash-drained utility expires on Feb. 7 and the Bush administration has said the order will not be renewed -- a move which could mean no heat, cooking gas, or hot water in hundreds of thousands of homes. The energy emergency rippling across the U.S. West began ringing bells in Nevada on Monday when Sierra Pacific Resources Corp. said it had filed with state regulators for an emergency rate increase averaging about 17 percent for customers of its two Nevada-based electric utilities. The company, parent of utilities Nevada Power and Sierra Pacific Power, said the increases were needed because of skyrocketing wholesale electricity prices. ``No business can continue selling a product for less than it costs them to buy it on the wholesale market,'' said Chairman and Chief Executive Officer Walt Higgins.
As California grid officials kept an anxious eye on the transmission lines, pressure is mounting to find a way to solve the emergency, which is also fraying nerves and demanding prompt action in neighboring Oregon and Washington. The two states have been shipping emergency supplies of hydroelectricity to California, but their own reserves are rapidly dwindling, threatening power emergencies this summer. Their governors are to meet on Thursday with top federal energy officials in Portland, Oregon, to map out a strategy to ease the strain on the power grid serving the entire western region and to try to lower soaring power prices. Like California, Oregon's and Washington's demand for power is outpacing supplies due to expanding economies and growing populations.
Black Blade: So it goes! Who woulda thought it! ;-) With a $11 billion surplus, that's about another 5 and half months of energy before the state goes tits up at this rate. Then again, the other states are offering electricity on a cash basis only.
Mexico Sells Electricity to Power-Starved California
http://dailynews.yahoo.com/h/nm/20010129/ts/mexico_us_dc_1.html MEXICO CITY (Reuters) - Mexico is selling 50 megawatts a day of electricity to energy-starved California to help the state weather a shortage that left millions affected by rolling blackouts, officials said on Monday. Mexico's state-run Federal Electricity Commission said it began providing the power to the California Department of Water Resources on Sunday at a price of $230 per megawatt hour. Mexico had earlier offered to help California, where tight energy supplies are blamed on the failure to build new generators and on a botched experiment with deregulation. The nation's most populous state has been hit with controlled, or rolling, blackouts as a result of the crisis. ``The quantity of energy sold could be increased...by up to 150 MW at non-peak hours,'' the commission said in a communique. Mexico has little spare capacity or access to interconnections with the United States, hampering its ability to provide ample relief to its northern neighbor. Fifty megawatts can meet the energy needs of about 50,000 homes. Mexico is also facing a potential power crunch of its own, and experts say it must come up with additional generating capacity in the next three years or face blackouts.
Black Blade: This is good. Kalifornia must rely on the third world's energy to get by. What does that tell ya?
A sigh of relief for TEX (msg#: 46901) ... or not(?)
TEX said, "You know, I really like lurking and following the commentary .... No matter what, all I care about is......WHY IN THE HELL IS MY PHYSICAL CONTINUALLY LOSING VALUE?"
May we conclude you are claiming that the quest for satisfaction of enhanced understanding along this line of inquiry is the reason for your visitations here? Or are you saying that we should put aside the idle banter until we explain this phenomenon as if for the first time?
Sensing the latter being the case...in your lurking, have you not encountered *any* of a variety of posts addressing price discovery? Therein lies the explanation you seek, coupled with, and in the context of, the classic flailings for survival of a banking sector finding itself to be overextended and trying to buy time. (How very fortunate it is when the efforts of your gold market "enemies" can be used to enhance your own positional advantage via this cheap gold condition they foster in the attempted work-out phase.)
More exotic explanations (beyond elaboration of details and background) are left wanting for a closer shave with Occam's razor. I hope this points you in a direction that bears you fruit.
To the best of my knowledge, there is one mutual fund in existence that specializes is silver. It was formerly called the Lexington Strategic Silver Fund. The fund was taken over by Pilgrim funds last year. Now what??
Pilgrim is attempting to close the fund down and merge it with their gold fund if they can get the shareholders to approve the move. If the plan is approved, there will no longer be any funds that focus on the silver industry.
Date: Mon Jan 29 2001 14:30
trader_vic (Rad0 - Dollar Flooding) ID#364271:
Copyright � 2000 trader_vic/Kitco Inc. All rights reserved
As I have mentioned here before, the key to turning the tide on gold is the US Dollar... As our trade deficit climbs and the stock market falls, you will see the dollar lose favor in many countries... The US dollar is overvalued because it is being used for the settlement of purchases by other countries who are buying US Treasuries and US stocks... once this subsides, the confidence in the dollar will decline and the value of gold will rise regardless of what Manipulation is actually going on in the markets... Understand that the currency markets are much larger than the gold market and therefore once the dollar starts to slide the pressure on the gold shorts will increase by ten fold... Also keep in mind that a lot of these trading companies are in gold carry trades where they borrow gold, sell it, get the proceeds and invest it in the stock market... once the stock market starts to go against them, it too will increase the pressure on the gold shorts to liquidate their carry trade and thus end up buying back their gold at much higher prices...
Elavator guy, and others: On tolerance and understanding
I thank you for your comments. To address one point you raised, I offer the following for consideration, not just for yourself, but for others. It is an area upon which life has taught me to feel strongly.
One thing that living, and working, abroad among other peoples and cultures has taught me is tolerance. Another is to see, and know, my country from another (and another's) perspective.
A famous English poet wrote � "��who knows England, who only England knows?�."
As you will gather this could be applied to any country.
I spent a lot of time among the Chinese people from both sides of �their� fence � Taiwan, and The Mainland. I had the honour of teaching some of their brightest students at university level. And, as you should know, when we teach, we learn. Yes, I learned much.
You mention about Mao, and threw out a figure of �murders� ascribed to him � 80 million.
Remember the population of China is around well over one thousand million. Which means that when you get conflict of interests and ideas among its population numbers can run into hundreds of millions, just in one area of discontent
(An item, not referred to in the US press, is that when the US's Chinese puppet (at the time) Chang Kai Chek was defeated and ran to Taiwan, and sought sanctuary there, he slaughtered thousands ( a large percentage of the population � the original Taiwanese), on that tiny island.)
Before making further comment ( I know how easy it is to be swayed by what we read) you must understand the history and nature of things.
Whether it is in Russia, China, Cuba or anywhere, communism can only come about when the mass of the population has been pushed to a point where they have nothing to lose, to where there is little or no middle class to act as a buffer between the haves and have-nots, and the proportions of the two are way out of balance. At least, that has been the case so far.
This population anger takes a long time to build up, it is amazing how much economic suffering people can take before they strike back.
I don't want to give a history lesson. The objective here is to get you to understand that the media, and much of our state controlled educational system, in all its forms, is there to direct our thinking, and not to make us, or even help us, THINK,
What amazes me is that so many can see this mind manipulation in one context and not in another. Many of our forum members can see this in the way media manipulates us in our thinking about the Wall Street Casino, or state of the economy, but not in our relationship with the world.
Before judging other countries, which have not had the good fortune to have matured in an Anglo Saxon based economy, culture, and political system, combined with a reasonably contained population growth, I would like you to consider the following scenario.
As you almost certainly know, in spite of the US's economic growth and standard of living, there are still large pockets of the population who are most dissatisfied with government and have even banded together in private armies. They feel that one day the �system� will collapse.
Up until now, there has always been a strong middle class that acts as a buffer zone between the rich and poor. Yet, if the government did not keep a very large and efficient surveillance unit both overt and covert, backed by a regular army and militia, there would have been many more Wacos by now. Do you not agree?
Look a little down the road. As you know there is appearing a greater divide between America's rich and poor � the same with the UK. Let us say there was a particularly hard landing (don't fear, there won't be, they dare not allow it), Imagine America going through a pre war Germany type of hyperinflation, with law and order breaking down considerably worse than it is now (if that is imaginable?).
Some other, anti American country, (It is not important which one) saw all this coming and had infiltrators, many dissatisfied US citizens trained and ready to stir up the people and take advantage of the situation to destabilise and destroy the US establishment (not its downtrodden people) from within .
Vast amounts of money were also available to support any insurrection, plus military support was promised once the �rebels� had got a foothold.
Crowds break through and camp out on the White House lawn, and the whole country erupts in anarchy.
How do you think the government would react? What percentage of the US population would perish by government bullets, and other forms of mass executions, in an attempt to restore law and order? These killings and purges of government banded traitors and �enemies of the people� would go on long after order was under control.
Some of those who escape are hosted on TV� in other �sympathetic� countries throughout the world and tell their �harrowing stories� of how they were persecuted and tortured by the US regime, and how they witnessed mass slaughter of �innocent� people.
If the �rebels� succeeded � how many old scores� would be settled,; how many innocents would die?
Enough of this, if you haven't got the picture, and the message by now no further elaborations will be effective.
One of our greatest mistakes in inter- sex relationships is to think the opposite sex thinks, and behaves like we do. While we have common likes and dislikes, we approach things from different angles and levels of importance. This causes us to misunderstand, misjudge, and engage in conflict.
So it is with countries, and cultures. As the Indian (American) says, don't judge another until you can walk in his moccasins. Or, as I once saw above the door of an old but large
residence in the Isle of Man in my halcyon days (but it stuck with me) � "Judge not your fellow man's condition, until you be in his position".
I haven't read the Lorraine Day book, but I have read "World without Cancer" by Griffin. I can't vouch for his conclusions, but it is a good expose on the gestapo that we call the FDA. Just about all cancer research in the last 50 years has been used to find a cancer drug that big companies could patent, sell, and make a killing on. (sorry about the pun)
The FDA has made _illegal_ some of the cancer remedies based on diet, and has also ostracized doctors and threatened them with their licenses. They have banned sales of apricot seeds. Yes, apricot seeds, that great threat to our society. (that was sarcasm)
LeSin, could you elaborate on a few items here? It might be helpful.
First, this item in your post:
---"the confidence in the dollar will decline and the value of gold will rise regardless of what Manipulation is actually going on in the markets... Understand that the currency markets are much larger than the gold market and therefore once the dollar starts to slide the pressure on the gold shorts will increase by ten fold"---
Granted, the forex market is huge, and the dollar's date with destine holds in store a definite decline. But wherein lies the direct arbitrage link with the currency market that would necessarily force higher the price-discovery mechanism for gold? What would cause demand pressure to increase for paper gold among smart money players?
Second item from your post:
---"Also keep in mind that a lot of these trading companies are in gold carry trades where they borrow gold, sell it, get the proceeds and invest it in the stock market... once the stock market starts to go against them, it too will increase the pressure on the gold shorts to liquidate their carry trade and thus end up buying back their gold at much higher prices."---
Granted, the gold carry trade participants will in time seek to acquire and repay their gold loans at better prices (gold exchange rates). But as these efforts put demand pressure on the physical market, where comes the expectation that parties will be putting an equal demand on the paper gold traded within the price discovery mechanism to drive up prices accordingly? Is it not better to sell paper so as to "end up buying back their gold at much *better* prices"?
For as long as gold yet flows from weak hands and from leasing hands to satisfy demand at the paper price, then the crisis is not apparent. Just as the old bank run appears business-as-usual in the morning at the front of the long line....that is, until the point in the day arrives in which a customer steps forward and must be turned away empty-handed for lack of available supply. This is where we would expect to see rising metal prices via premiums to balance the physical market, even as paper gold could continue to sell off at a risk discount.
Buying gold now, instead of waiting for the possibility of these better paper-derived prices is wise for several reasons. First, at near 22-year lows, the price is right, right now. Second, it is reassuring from a buyer's perspective to earmark your claim of available gold for shipment to you during calm markets--meaning, nobody likes to hunt for Easter eggs in a hurricane. Third, nobody can tell from the price performance (as determined by paper gold) when the day will occur that physical gold price premium must rise (suddenly!?) due to lack of physical supply to fill the demand at the paper price. It could happen next week. It *could have* been seen to happen already, months ago. Can anyone venture a guess why Chancellor Brown pushed hard for IMF gold sales, and when met with resistance on that front, the Bank of England relaxed its grip on some of its own? The LBMA is, after all, quite nearly the BOE's baby.
"But the threat of agricultural imports in the near future from US and Asian/Australian industrial agriculture under WTO terms means that either the farmers practicing traditional iron age technology go bust in one large wave and arrive in the cities en-masse as refugees, or they be allowed to send growing numbers of family members to town in order to have an easy transition and a natural growth of farming capital."
ORO, we are all fully aware of the income of the average chinese. Assuming the largest consumer of chinese agricultural products are the chinese people (of which there are quite a few) how can they afford to buy food from US/Australia when the cost of production there is higher than food produced locally in china. The US/Australia would literally have to give the food away for free in order to be threat to the local producer, regardless of how inefficient the method of production employed.
I have observed the scenario you described above in parts of africa, where imported food as driven the local farmer off the land. The farmers then wait for the World Bank/IMF/UN to bail them out. Chinese people are different to (black) africans. They are not known for sitting back and waiting for handouts from World Bank/IMF/UN, they have a diffrent culture/mentallity.
Daron Rahlves of the US Ski Team finished first, before runners up Austria's Stefan Eberhardter and favorite Hermann Meier in the "Super G" even of the Alpine Skiing World Championships of St. Anton, Arlberg. Gold medal winner Daron Rahlves has already proven his skills in prior races.
Congratulations to the US Ski Team. I'm happy for you
"Stranger" since the timing of this victory is most opportune in view of the Park City Olympics 2002.
Chinese agricultural products in the next 10 years will begin to displace US domestic production in the US market. Increasing amounts of US farmland are being bought just to lie fallow. The climate and soils of mainland China allow the production of all crops grown in the US. The Chinese are currently bringing tremendous projects online for taming rivers and irrigating new regionsfor agriculture. The first casualty of the US ag economy will be the citrus producers. The Chinese have already geared up for their entry into this US market.
Notice lately how the POG goes up overseas in nightly trading, only to splash down in NY? Very curious, very curious indeed. Gold currently up +$1.20 and NY about to open.
A Rigged Gold Market has Made Our Predicament Worse
Were gold permitted to trade freely, rather than being rigged at ever descending prices by the past administration in quest of the political benefits of a strong dollar policy, no doubt we would not be in the dire straits our economy is currently in. If the price of gold had not been rigged at lower and lower prices through the use of the gold carry trade mechanism, a warning sign would have been issued to investors and policy makers that all is not so well with the economy as a continuously declining gold price suggested to folks like Lawrence Kudlow who has continually harped on that theme throughout the Clinton years.
Had the gold price not been manipulated since 1994 so that it could have moved toward a level where we think it rightfully belongs, namely $600 or higher, it is doubtful the new paradigm myths that led to huge does of money creation and an insanely priced stock market could have occurred such that President Clinton avoided removal from office. Instead, investors and policy makers would have been in tune with economic realty to a much greater degree than they have been in which event the huge debt burden we now face and which threatens to catapult us into the first depression in 70 years would not have occurred.
The gold manipulation measure can be compared to a simple medical analogy. My 15-year old son is currently experiencing a viral infection of some kind. This morning his temperature spiked up to 103 degrees and he felt absolutely terrible. Two Advil tablets and one-hour later his temperature fell to 99. He felt so good that he began walking around the house and went on his computer to go on the Internet. Though he felt much better, nothing of an intrinsic nature had changed as far as his viral condition was concerned. But he felt good so rather than rest, which would have been better for him, he became active presumably to the detriment of his illness.
So it has been with gold during the Clinton years. As well documented at www.GATA.org and in Reginald Howe's law suit against Mr. Greenspan, the U.S. Treasury Secretary, the BIS and several large bullion banks, the gold price has been pushed to artificially lower levels so as to disguise basic and fundamental weaknesses in the American economy and in the process create a sense that things are much better than they in fact are. The eventual price we will pay for these false readings will be much more severe than if an equilibrium gold price had been permitted to provide an accurate "temperature" reading for global economic participants.
GATA Denounced by Doug Casey & Others
One of the big disappointments for me at the Vancouver Venture conference came at the end of the show when Doug Casey and a couple of other speakers on the "World Outlook" panel at the end of the show talked about GATA in a disparaging manner. Without giving any reason other than to say that you can't get two or three people to agree on anything, Doug laughed off GATA's gold conspiracy message and said the folks at the conference should "get a life." Clearly Doug nor another speaker who spoke against GATA had ever seriously considered the charges of Reginald Howe's suit against Alan Greenspan and other heavy weights nor have they looked seriously at the 119 page document titled the "Gold Derivative Banking Crisis." The impression I had was that these panelists were simply too busy being politically correct to appear to even entertain the notion that our government would or could do anything wrong. One wonders what world these guys are living in.
Also being politically correct was Bob Bishop who also went on record saying that he did not subscribe to the manipulation theory. However, he did at least point out that some big bullion companies were making huge profits from involving themselves in the gold carry trade.
But I am really puzzled as to why Doug Casey and a majority of the gold mining industry itself is being so stupid about this issue. An unspoken policy of aiding and abetting the short sellers of gold was obviously made when, during the Asian crisis and Long Term Capital Management crises of 1998 Alan Greenspan said, "....Central banks stand ready to lease gold in increasing quantities should the price begin to rise." How can anyone see those words as anything but a statement aimed at keeping the bullion banks borrowing gold at say 1%, selling the gold for dollars and re-investing it at 5% to 7% in U.S. Treasuries? Why on earth would they continue not to do so, if uncle Alan assured them that they did not need to worry about a rising gold price when they covered their shorts? Are we to believe the great financial engineers at places like Goldman Sachs, JP Morgan, Chase, Citigroup and Deutsche Bank would not take those words to heart and profit from them?
Ok, so if you don't like the "M" word or the "C" word, call it what you like. Mr. Greenspan by his words has instituted a policy based on a guarantee from central banks to the heavy hitting gold bullion banks most closely aligned with our political process by guaranteeing them huge profits by continuing to sell gold short. That my friends is "crony capitalism" American style. The policy ensured that the buddies of then Treasury Secretary Robert Rubin could continue to reap huge profits without facing normal risks in this business because of protection from the Fed. Indeed, it was Goldman Sachs who most heavily benefited from the gold carry trade business during Rubin's tenure at Treasury.
A Growing Belief in Manipulation from the Main Stream
Casey's stupidity notwithstanding, there are those who are examining the GATA's charges with an open mind and some of them are concluding that GATA is right. A couple of weeks ago, the CEO of Freeport McMoRan said on CNBC that "Central banks are the OPEC of the gold markets and that they will keep the price of gold down as long as they want." Then this past week, Richard Russell, editor of "The Dow Theory" who is certainly no card carrying member of the "Gold Bug Society" said, "I don't as a rule, believe in manipulation in the markets, but if there are two areas of manipulation they are (1) gold - every time gold sticks it's little yellow head up, someone, somewhere - brings a hammer down on that poor head. Ouch! (2) The Dow and the S&P - watch the last 15 minutes of every session. Someone, probably a fund or a brokerage house, moves in and buys just enough to move the Dow up 15 to 25 points and the same in percentages with the S&P. I understand the SEC is investigating this strange and really naughty action. You can always count on a little upward pop in the average near the close. Hey, it's just not fair to the shorts."
JAMES MOFFETT is Almost But not Quite Right
Where I differ with James Moffett is in his suggestion that "the OPEC of the gold markets" will keep the price of gold down as long as they want to. It is my contention that they will keep the gold price down AS LONG AS THEY ARE ABLE to do so. Policy makers will never wish to see gold rise because that will represent a bad report card for their handling of the economy. But, at some point, attempts to suppress the gold price will fail because faith in paper will disintegrate at which time there will be no stopping people from trading dollars for gold short of totalitarian means.
With the money supply (M-3) now at 7.2 Trillion vs. 1.8 Trillion when gold hit $850 per ounce in January 1980, the potential for gold to rise substantially above that old high is very obvious. It is for that eventual move out of paper and into gold, representing a systematic breakdown, that we hold steadfastly to our allocation of gold in our model portfolio. We continue to recommend investors place up to 20% in gold shares and 2% in gold and silver coins as "emergency" money.
January 29, 2001
Jay Taylor
Editor of J Taylor's Gold & Technology Stocks
www.miningstocks.com
Two very interesting statements in you post below to Journeyman:
"The objective here is to get you to understand that the media, and much of our state controlled educational system, in all its forms, is there to direct our thinking, and not to make us, or even help us, THINK, "
AND
"Yet, if the government did not keep a very large and efficient surveillance unit both overt and covert, backed by a regular army and militia, there would have been many more Wacos by now. Do you not agree?"
I don't know what you have read, but IMHO, if it not for the US goverments overt and covert ops, we would not have had the Waco disaster at all. Or Oklahoma City bombing.
In America, people are supposed to be innocent until proven guilty. Not tried on TV by government officials who tell us they have weapons stored and are dangerous. This is what happened. Did we ever see the weapons? No.
Were the poor souls given a fair trial? No.
Since when does the BATF go in with body armor to investigate child abuse? Never before.
I submit that in the case of Waco you have fallen for the same trap you are trying to educate us on.
The media put those people on trial as the FBI used Gestapo tactics on them. Then they torched them and buried the evidence without any investigation.
Then the one man who was investigating the film to prove the FBI was shooting into the building (the FBI was lying) was found dead in his apartment.
And don't forget, 4 of Clinton's body guards somehow died in the fire fight also. Why? Maybe they knew too much.
I don't know what country you are in and where you getting your info from but Waco was not the result of a band of citizens gone astray.
No, groups like Waco and the Michigan Militia are not to be feared.
"I'm from the government and I'm hear to help you."
There has been a number of comments in postings which indicate an interest in China, a country for which I have great affection.
A long time ago, I got a strange feeling that my life would be favoured, one day, by two elements � China, and gold. At first, in fact, until quite recently, I could not see how these two correlated. However, I am beginning to see, now, how they may.
I feel that, soon, China is going to be eventful in helping to remove the shrouds that have veiled the lustre of this unique gift of our God. ( to our over zealous religious friends � all things are His gifts, and gold is unique).
How this will come about, I am not too sure, but I have some very strong ideas, which I will reveal from time to time.
Meanwhile, in support of recent comments regarding �The Middle Kingdom� I offer the following.
One ( only one) of the main reasons you may see an increase of anti-China rhetoric (notice I said anti-China and not Chinese (there are too many in the US) once King George (Bush) gets his ar*e and his feet in a comfortable position at his throne, is that TPTB will want to get China edgy enough to start spending more on military defence, thereby slowing down, through lack of capital, all the 'peaceful' developments needed to improve the Chinese economy.
It is NOT in the interest of the US ( or those that use it as their main tool) to see a nation with a political ideology which is at variance to its own be a successful example that other �side-line� nations may wish to follow.
This divergence of finances and resources away from building economic strength, and causing a more unstable, and depressed economy to create unrest and dissatisfaction among a people suffering great change worked with Russia, it is too tempting for them not to try it with China.
The attitude being ��this way we can beat �em without a shot�.
There is no question, that if China is allowed to �get on with it�, and jf it is really in America's interest (as so many politicians proclaim) to have a stable Asia, she should do so, then the measures China is taking will bring about a prosperity of which no Chinese, ever in its history , could have dreamed.
I've studied the supply and demand of cotton for the last year. The average import price of cotton going into European ports from the five cheapest exporters is called the "A" Index. China will outproduce everyone this for the 2000 growing season with 18.5-20 million bales of cotton but they have not been among the five exporters of the "A" Index.
It is a misconception that whatever China produces in agriculture is produced at a cheap price. Concerning their textile industry, it's growing at an amazing rate but agricultural commodities such as corn, soybeans and cotton are priced on a world wide scale and China's production, even with excess (as in cotton) is not cheaper than the world price.
They will be able to buy gold and lots of it soon.
Rich
Dave C my dear fellow knight, you are again allowing your emotion to blind and not see the spirit of the message.
It beats me how you can fail to see that what I am saying is what you are in a less emotional, and perhaps more constrained way.
I had to read my posting again two or three times to see how any rational person could misunderstand my meaning.
It must be that blood rushes to your eyes the moment you see
Pandagold. Where you frightened by a panda as a child? But they are such loveable creatures.
Going back to our last clash of lances. If you had read my other posting in a more relaxed manner, you would have seen that my last paragraph was a cynical comment. In fact the whole posting was sprinkled with cynicism. (I majored in it)
It is just that I want you to understand what I am saying. You don't have to agree, but understand -please!
What my posting is saying is that before we judge another country ( from what we are told by education, media, and government) and compare with our own we must understand how that other country has evolved by history.
I tried to set out a scenario that showed the US being faced with similar economic conditions which other less fortunate ones, until now, have experienced.
I also tried to explain that even in its present upbeat economy,and high standard of living, there is discontent, and how easily, should this economic climate change for the worse, the same things could happen in America.
I understand all about Waco, Oklahoma, Kent University, and government cover-ups, and misinformation bla bla.
You can thank the mainstream media conglomerates for our warped perspective on the holocaust. The State of Israel has been exploiting the holocaust for decades. Israel gets three billion dollars per year from the U.S. taxpayer with no strings attached. I'm sure you've noticed that any reporter that questions what Israel is doing is dismissed as being "anti-semitic" - whatever that means. All this while the on-going holocaust in Palestine continues.
CongratulationsI salute both the sentiments and the objectivity!
The real problem for forums of this type is oftentimes the narrow perspective brought about by the narrow focus of topic. So often ignored is the sociatal aspects of blindly seeking the fruits of limited interests, and one should always endeavour to look on the cultures of others dispassionately and objectively. There is often a true measure of blindness here - and one that is inevitable in that the interests of the group IS limited to one small area. This is not a statement that is meant to insult; it is only a generalization that can be similarly attributed to a discussion forum on, for example, pottery collectibles. The ecological movement is one area that is ignored or held in open contempt on this forum - but is quite obviously an area that most know nothing about or could care less for; but (in glaring example to those who should only look) a fully prosperous and totally free economy will not guarantee the lives of future generations -only "profits" and security to the few who choose to pursue this end while ignoring other consequences . The ecology faction is NOT a bunch of head-in-the-sand fruitcakes. For the most part they only seek a workable compromise. They only believe that there is a downside to all events and a balanced perspective is not served if one ignores this simple truth.
We applaud Trail Guide for the traits of a balanced view (and sometimes -recently apparently - revile as well), but he is a thinker that sees beyond.
We should also applaud your thoughts for the same reasons.
... in NY - is the FOMC discussing cutting interest rates to shreds? Seems like last call to get gold ... Eagles, Maples, Krugers, Phyllies, Nuggets and yes, even Panda's are priced for clearance - still.
Where's Aristotle to remind us of "gold get you some!" cb2
The use of energy and population are statistically related but are not causaly related. The causal connection between energy supply, use demand, and population goes through the technology of utilization and production as they are limited by restrictions placed by government on their application.
Placing price caps on energy charges (electricity and gas)to the consumer prevents people from making the decision as to how much energy they are willing to forgo at the current supply levels. Price is the only mechanism available through which to weigh decisions. Centralized decisions on pricing are not workable because pricing is not set by the millions of individual decisions as to how much of which energy to consume but by representatives who have a minor interest in the broad outcome of their decisions facing energy businessmen who are negotiating a fixed agreement in a world of changing circumstances.
The geologist you quote, not being an economist, sees only the quickly depleting pockets of natural gas in the ground as energy and is blind to nuclear, coal, tar sands, etc. that face only government restrictions to their use (the popularity of these restrictions as the "will of the people" is irrelevant as an economic argument, it is only relevant if people refuse to purchase power from unpopular sources). He is also wrong on "conservation". Utilization of energy can be made much more efficient as prices dictate. With low prices forced by government decree, the market signal to conserve by replacement of sources and more efficient technologies for use (investing in new appliances and HVAC systems) is not given to the consumer and the industrial user.
In the decade 1975-1985 we saw energy use shift to higher efficiency cars, appliances, lighting, heating, insulation, etc. that also use less energy intensive materials in their production and found industry shifting "heavy" production offshore where the differences in environmental compliance costs and energy prices (labor prices too) were now higher than the cost of shipping and capital replacement. The industrial plants were themselves torn down and reused to produce cars etc.. A new car from the late 80s and early 90s used 1/4 to 1/3 less steel than the same size car of the mid 70s-early 80s. These same cars also gave 20 mpg instead of 15 mpg.
That was a market response to energy prices. Allow the same in the electric and gas markets and people will respond. Disallow this, and businesses (and people) will flee California to other states where electric supply is stable, or start producing their own private "surge" electricity through the cheap generators now available (by the way, the tech revolution has made this possible since the design optimization and supply chain management costs were major inhibitors to low cost generator production in the past).
It's down -- POG is up. Yeah, it's a rigged paper price, but it's all we've got (for now).
My post yesterday on the technicals of the paper price discovery outlook for POG cannot be considered in a vacuum. The dollar is an important factor - as today illustrates.
I'm concerned about my country having lost (through short sighted treasonous trade agreements, and the unrelenting greed of our political and financial class) our basic manufacturing industries in the USA. Especially in fly over country. The '90s have not been boom times here. Both coasts feed long and hard at the import trough, at the expense of competitive industries and workers second to none!
My concern with China as it relates to ag exports is very simple. I don't want to see the US needlessly dependent upon ANY other country for FOOD! The US citizen has displayed extraordinary restraint in their response to the predatory selling off and outright destruction of many of our industries. But I assure you, the line will be drawn at FOOD!
All of your geopolitical and militarist theorizing about a US-China dynamic to defeat China through forcing China to ramp up an arms race, is IMHO way off target. In fact I find it somewhat insulting, more so than the chatacterization of a duly elected citizen to the office of President. I'm happy to leave the coronating to the Europeans!
US trade policy for far too long has concentrated upon making a fast buck for a well connected few, at the expense of the many. If this policy continues, I fear it will foment actions of much more concern to the world than if China can withstand an arms race.
Chinese Agriculture,Currency Valuations, and Gold.
As some may have wondered about my "handle",I have been active in the-Golden-Honey & Honey-bee business for the last 18 years.***The U.S. has less than 1200 active Honey producers nationwide,for a population of about 281 million, and the producers numbers are drastically dropping.
Why???
Answer:
Imported Honey, mostly from mainland China,costs about one third as much at U.S. ports as it costs an American producer to produce it.
Another,Why???
The main reason, there are some others,is; The tremendous discrepancy between "Paper Currency Valuations"!(U.S. dollar & Yuan)
I personally did a study about 10 years ago,(when the Chinese imported Honey first started wrecking the U.S.Honey business.)result:
The wages of one hired U.S. Honey-bee worker were the equilivent of 1200 Chinese Honey-bee workers,,,YES 1200!!
Impossible for the U.S. producer to compete!
The prices you see on all Chinese imports in the U.S. are the results after brokers,Governments, and others "skim huge profits"!
Which brought me to the reasoning that; wouldn't it be nice if there was some form of universal money that was equitable in "Valuation" to everyone in the world?
THERE IS!....and it is GOLD!!!
Before air travel, instant communications, and television, changed the world,(100 years ago?) semi-universal Gold valuation was the glue that forced all peoples to trade honestly, through-out the world. Please think about this!
***Figures are from the American Bee Journal.
Thanks for Reading....beesting.
One of the aspects of China and many other emerging economies that we don't often consider is the portion of the economy that is non-monetary. People who grow their own food and barter it locally for clothing and simple iron works don't need much money for trade. It is only when transportation infrastructure makes cost effective transport of local production to and from other localities possible, that a monetary economy can fully develop. Most of China (and the Chinese people) is 50-100 miles from the nearest paved road or railway. Thus a fully monetary economy is still limited to the cities and their rural environs.
The portion of the product of labor in rural China that is compensated in money rather than in the product itself and in local barter of it is still very limited. Even in the cities, housing (which is some 15% of our economy) was until recently non monetary and awarded politically by the employer or government - meaning no mortgages or trading, nor substantial spending on home improvement, nor market rent. Thus labor compensation, when the value of non monetary elements is considered, is higher than it seems in the income statistics - which consider only monetary income. Where this shows up is in the purchasing power parity statistics which show up the local purchasing power of the low nominal pay being 5 to 6 times its purchasing power in the US, thus a $200 pay check buys $1000 worth of goods for the employee getting all his compensation in money (which has only become a common phenomenon this decade).
When this is considered, and the fact that income in the city is much higher than the income in rural China, then we can see who would purchase rice and flour for which labor per ton is negligible in the US, but very high in China, and having much lower transport costs from California ports to Chinese coastal cities than from the Chinese heartland (where the low productivity makes it necessary to have a larger - and non-existent - transport network that can make 10-50 stops to pick up the product that a US farmer would bring in a single pick up at a grain elevator).
As rural production increases productivity with capital bought with city wages of family members, and with the spread of industrial farming from the vicinity of cities to the heartland, the transportation network would develop. Then, the people living in rural China would start migrating to local industrial centers, and to coastal cities, eventually reaching an industrial economic structure, and a fully monetary economy.
@ Pandgold, Journeyman, ET, Panda? How will the potential of the industrialization be utilized by a government that has so much mind control over the population?
Peter Asher (12/20/98; 19:55:18MDT - Msg ID:1450)
Through the eyes of a child
(From my youngest, in her travels when she was seventeen)
April 1993 --- Moscow to Mongolia.
.
I'm on the train, still. I'll get to Ulaan Baator day after tomorrow. It's mostly Chinese smugglers
and the most embarrassing Western tourists. One of the Chinese gave me a carton of cigarettes in
exchange for keeping some boxes of perfume in my bag at the border, because the customs
officers are less likely to check mine. (It's not illegal, it's just that they take what they like.) I've
brought many things for presents because I've read they're better than money. (There's nothing to
buy.)
Every time the train stops, the Chinese rush over and hang out the windows selling T-shirts and
sunglasses to the Russians, the Russians crowd the platform selling raspberries or chickens or
bread, and the westerners take pictures of the whole thing.
October 1993 Taishan Mt., Tai'n, China.
I asked one group of students I met half way up to explain what they knew about the mountain.
They said it is not a very high mountain, but it is the only one in a large flat area and has been
holy for a long, long time; that the emperors used to go there to pray. And some "old people"
still believe in it. I asked if they believed. They stated quite simply that their government had
taught them from a very young age that there was no God, and therefore they don't believe in
God. They said the government allowed them to believe if they wanted, but you can't change
your mind about something the government's always been telling you, can you? I said (twice),
"Yes, but do you believe the government?" They laughed nervously and looked at each other,
continuing the conversation as if I hadn't said anything, and then laughed nervously again. They
said that 97% of America's population is Christian, and if they were living somewhere where
everyone around them believed in God, so would they. "Well, I think for myself," I said. This
appeared completely incomprehensible to them. Well, this is China, not Russia, not Mongolia.
No wonder Communism has lasted so long here.
Yesterday, I climbed the hill with the children to a place at the top to put prayer stones. Partway
up, while resting, the Russian-speaking girl (a thirteen-year-old, 2 years ahead in school) said,
"My sister wants to sing you a song." Her sister sings this song, big smile on her face, voice
sharp and clear over the silent town, and I think, "Where do these fairy tale children come from?
They are happy and full of laughter and all the good things people think of when they think of
children, and none of the bad. They live here in Tosonstengel, where nobody has a job because
the furniture factory closed down, nothing works anymore-- electricity, radio. Nobody has any
money. The woman I stay with weaves carpets now to sell, because there is no work. I think the
man fixes clocks. Everyone has taken something up at home. But they have such poverty and such
difficulty - no gas for cars or barely any, etc. Yet they are the happiest people I have ever
known, despite the hardship. Not that they don't mind. They do. But how come the Europeans
have so much and aren't happy? The children always amaze me. A two-year-old child pours
herself a cup of tea from a heavy teapot. Seven-year-olds tending the fire, helping with the
cooking. They wash the clothes, dig up the potatoes at lunchtime, go to get the water from the
river, never have any problem with it. And they are incredibly capable, riding around on horses.
(Lamp oil running out. Good night.)
I shall treat your vitriolic attack with the contempt it deserves. You show, by your own words, utter self-interest,
the sort of thing we are condemning in those who appear to be manipulating gold.
You may say you disagree with someone, but watch the way in which you express it.
I thought better of you than that. I was obviously wrong.
The dollar debt of Chinese industry is one factor creating a monetary drain on the economy and distorting the currency exchange rates. The other is the heavy dollar debt burden on the SE Asian competitors with China - which forces them to distort currency exchange rates such that their products are cheap enough in dollars, to be sold to US consumers (where the dollars that repay the debt are printed). In this way, China is forced to lower its relative labor and land costs in dollars to match the SE Asian prices just to pay for its oil, capital equipmet, and technology imports that are still not produced internally. Local tech and capital goods production is advancing rapidly, and China is building up its collection of treasuries which will soon be sufficient to cover the whole of the dollar debt service out of interest on treasuries.
So long as the dollar reserve system continues to distort the economies of US trade partners, this condition will continue.
Might I suggest, and I for one will practise what I preach, that we keep as near as we can to the gold market. Things, I feel, are beginning to stir. Maybe very early days, but if we are not careful and get side tracked, we could get caught napping.
I am not blinded by emotion and I do not quiver when I see your name.
I read the following:
"Yet, if the government did not keep a very large and efficient surveillance unit both overt and covert, backed by a regular army and militia, there would have been many more Wacos by now. Do you not agree?"
I take this to mean we need more overt and covert gov ops to prevent another Waco. What did I miss?
I appreciate you trying to help all of us see the light, but I would say that from my experience lurking here, you may be using the wrong tactics.
I would venture to guess from your language that you are a woman. This is not meant as any kind of negative or positive, just a guess. Probably PHd also.
Regardless, since this castle is inhabited by men, I will say that men do not always appreciate a direct frontal assault from someone trying to help.
I have to explain this to my wife often.
I too have studied media brainwashing tactics, how television works on the alpha waves of the brain, how only 10 corporations control most of the news in the western world.
I too have studied history. I know that no two cultures are the same and that we must walk in another's moccasins.
I too have studied governments, blah, blah, blah.
What you see as emotion in my posts I see as direct statements and questions. I challenge direct points while you are reverting back to the complete post.
It's my style to tear apart a post, or a story, or an article, bit by bit. To kinda of disect it. It is because I am an analyzer. So I analyze wach bit in the post.
I aggree with a lot of what you say, though not always the way you say it.
I guess that will be the way of our relationship.
It's tough when you cannot see the other person. But I am sure we can make do.
And we can talk about gold too. I love it. Got a nice stash. Philharmonics mostly and some Brit Sovereigns.
I can drive over to Switzerland or Austria and pick them up at the bank.
I hope Murphy has someone watching his back. The man has guts
Posted: 2001/01/30 12:26 PM EST
Gata's Bill Murphy:fringe lunatic or golden messiah?
Bill Murphy, the personality behind the Gold Anti-Trust Association (Gata), is in South Africa on an awareness and fund-raising mission the fruits of which may help finance an amazing finale in Gata's two-year crusade.
If successful, Gata will strip bare a gold cartel whose influence allegedly extends to the highest reaches of the US government.
The crucible of Gata's argument is the upcoming legal proceeding scheduled for March 15. This is when key US business players, such as JP Morgan and Goldman Sachs, will appear in the Massachusetts District Court to respond to a complaint brought by Gata's Reg Howe. If the judge admits the action, even Alan Greenspan will appear under oath answering evidence supplied by Gata of a sprawling, four-year long manipulation of the gold price.
According to Murphy, short positions totalling up to 12 000 tons of gold have been amassed by JP Morgan, the Chase Manhattan Corporation, Citigroup Inc, Deutsche Bank AG and the Bank for International Settlements (BIS).
Gata contends that allowing the gold price to rise in line with market forces will expose the banks to potential losses worth billions of dollars. According to the Office of the Controller of the Currency, the notional value of the off-balance-sheet gold derivatives on the books of the US commercial banks exceeds $87 billion � greater than the total US official gold reserves of approximately 8 140 tonnes.
'Wild Bill' Murphy
Murphy is known somewhat curiously as "Wild Bill"; curious because he's more avuncular than swashbuckling. His blazer still has the price tag attached to the sleeve. He hauls it off with an embarrassed snigger. He's carrying reams of papers, supporting documents, folders and reports and repeatedly fishes around, sometimes fruitlessly, for the evidence his amazing story demands.
For example: the International Monetary Fund sought to break the Washington Agreement � a moratorium on most central bank gold sales � by leaking physical gold to the Exchange Stabilisation Fund (ESF). In itself, the activities of the ESF are esoteric at best; dubious even. But in less than three months after the Washington Agreement was signed, gold derivatives surged to $87.6 billion from $63.4 billion.
Then, the Bank of England decided to sell 400 tons of its gold reserves; a plan hatched to maintain supply to major US banks desperate for physical material to close out their positions. In short, the BoE is in league with the gold cartel. Odd, isn't it that each UK auction is timed to coincide with futures close outs on Comex, Murphy asks?
Alan Greenspan decided to join the board of directors of the BIS � a position not taken by a federal reserve chairman in 64 years - to exercise greater influence in gold flow. Everyone is in everyone else's pocket. The conspiracy even extends to Lawrence Summers, secretary of the US Treasury.
It goes on and on. Take speculation that Barrick Gold is hoping to buy one or more of South Africa's gold assets. Attempts to grab unhedged mine supply are aimed at satisfying the gold cartel's desire for supply which easily falls below the amount of derivative exposure. "They (Barrick Gold) are very tight with the gold cartel," says Murphy. Are other gold producers involved?: "AngloGold is aware of the gold cartel but not complicit," he says.
Branded a lunatic
Murphy says the mainstream media won't give him time of day. "I was on CNBC once and that was it," he says. He believes the links between big business, with its extensive financial advertising in the press, is strong enough to have Gata placed on the lunatic fringe.
But there's the nagging regularity with which New York always seems to cap an improvement in the gold price.
Time and again, gold rallies only to be knocked on the head in the US. Cogent explanations for the trend are in short supply. In fact, Murphy believes Gata is maligned without proper consideration. "If you haven't read the evidence, how can you say we're wrong," he says. He's carrying copies of the report "Gold Derivative Banking Crisis" to convince the sceptics.
Even the sober Gold Fields Mineral Services (GFMS) has asked worrying questions about gold flow lately. There's some 180 tonnes of gold trade GFMS couldn't account for in 2000. "We think the figure is greater. GFMS have become more tolerant of our views," he adds. GFMS recently said it watched Gata's progress with interest.
Is it possible Gata is right and only now 'respectable' organisations are cottoning on? Some won't acknowledge Gata, however. The highly respected Jessica Cross of Virtual Metals is one; the World Gold Council is another. Not even gold producers admit to having an interest in Gata's work. South African company Harmony Gold says, contrary to media rumours, that the company has not contributed financial support to Gata.
Asked about the daunting prospect of facing up against the world's biggest bankers, Murphy laughs somewhat nervously, but you get the impression he's loving every bit of it. "I never thought I'd end up doing this," he says. Again, that's difficult to believe. Murphy is a bred in the bone maverick; born to swim against the current.
"I'm sick of the rich banks in New York. I want to put them in their place. I'm tired for the Establishment and want them to know they can't get away with everything just because of who they are," he says. If he's right, and Gata makes headway in March, gold bulls have every right to expect a massive run in gold. Murphy is forecasting a price of $600 an ounce before big business can clear the market.
http://www.kitco.com/charts/livegold.htmlWhat's that strange diagonal shape in the NY portion of the kitco chart? Looks like our rooftop when one of the shingles is about to blow off in the wind...
(Boy are we a thirsty bunch! Crawling through the desert for so long. I'm getting a "Bogie, in Treasure of Sierra Madre" image here.)
Leigh: Amen!
Interesting to see that forum discussing with Another how oil was being kept down, now that it's been up for two years. The sense of "one more piece has fallen into place."
ORO, Could you please explain what is means to have a convertable currency?
I understand that China was told by one Martin Armstrong (now in jail) to not make their currency convertable. Do you see this happening any time soon?
I also read just a week or two ago where China asked (?) Japan to stop the slide in the Yen. Is this the threat to currency stability you have been talking about?
Do you see a Euro-style monetary union coming any time soon in the Far East?
My response to your post was not one of "vitriolic attack". It was reporting accurately what has happened to much of the US economy, that is NEVER reported. Here or overseas! I also know all too well the bind that smart, dedicated, hard working citizens have found themselves in, through no fault of their own. You can theorize all things USA in your rarified "clique" of your own choice, just don't delude yourself as to what really matters. Food is kept cheap to the US consumer for the very reason I pointed out to you. If that food is kept so cheap that domestic production can no longer compete (WHICH IS HAPPENING NOW) with foreign food, and that foreign food captures the US market....WATCH OUT! When the foreign supply is cut off, it will get ugly.
Do not admonish me regarding self interest. It is inescapable, if you were honest, you would acknowledge your own. Of course I display a measure of self interest since I am a proud citizen of the USA, the nation and people so often maligned, yet under whose skirt most of the world always runs to when something mean says "boo". The European Union (an oxymoron if there ever was one!) will change the long term relationship between individual member countries from the USA perspective. The UK will lose the most from this change, from the standpoint of national security. The "special relationship" between the US and UK will be squeezed from the formation of the EU and the undeniable changing demographic within the USA.
<"Yet, if the government did not keep a very large and efficient surveillance unit both overt and covert, backed by a regular army and militia, there would have been many more Wacos by now. Do you not agree?"
I take this to mean we need more overt and covert gov ops to prevent another Waco. What did I miss? >>
By breaking up a posting into parts and taking statements out of context is where you are going wrong, DaveC.
That statement of mine did not mean that you were all fortunate the government had these things in place, or that they should have more.
It meant that if they didn't have, more people would be expressing their discontent with the system on a more vociferous manner. Then you could have reactions by the government similar to what other nations are often accused of.
Governments use these attacks, like Waco, not so much because of any real threat they pose, but to show what will happen to anyone who does - scare tactics.
China has a non-convertible currency, meaning that the central bank converts all currency (Yuan or Remnimbi) to dollars and other currencies in a fixed ratio, and in quantities that it wants. The fixed exchange rate and the control of quantities converted allows the central bank to stop inflows and outflows of funds into and out of China. It has a definite policy of not allowing unbalanced (net) outflows of substance.
The floating of the currency and its convertibility means that the Chinese central bank no longer fixes the exchange rate, and no longer controls monetary flows. It can then only buy and sell Yuan and dollars to adjust the exchange rate and the amounts flowing through.
Armstrong's reccomendation is related to the possibility of two things: The possibility of a sudden outflow due to repatriation of "locked" funds. And the possibility of China becoming a dollar debtor nation in response to below market dollar interest rates set by the Fed (as was done in the early 90s, bringing about the Mexico crisis and contributing the bulk of the debt that took down the Asian economy in 1997-8).
China can obtain the effects of a lower exchange rate on the Yuan by paying export subsidies. These, however, reduce government's discretionary spending and are thus limited in duration as China's neighbors and competitors adjuest their exchange rates to the dollar downwards in order to maintain dollar revenue sufficient to cover dollar debt service - the primary imperative of those of them that are dollar debtors and have to import oil.
An Asian currency union is unlikely because of tensions and mistrust in the area. We should expect closer coordination of monetary and currency policy at some point in the future as the Asian governments coordinate to limit their competition for dollars - to cartelize the demand side of the dollar. The use of the dollar for intraregional trade might be replaced by a currency package, or basket, rather than with a single currency of one country or of a monetary union. If a union were done now, the Yen and Japan would dominate the region, thus making it impossible for China to do so. Doing this in the future means that China will dominate, which neither Japan nor any neighbors would like to see.
Right now, the trend is to reduce dollar debt, and China is heading towards that goal. As Korea has, and as the other SE Asian nations are trying to do, though they are limited by internal political needs and a decade's worth of economic investment errors, that were caused by political rather than economic needs.
As Asia weens itself off of dollar debt, and I think you stated LatAm might do the same, what are the implications both there and in the US?
Does the paying off of debt actually "destroy" dollars (take them out of "circulation") or is it too late once the dollars are created through the loan process?
As I wanted to post "a letter from a friend", who's ideas I cherish and they aren't the usual run off the mill kind of thougts, sat back to ask me is it worth the
effort.
This forum, the esteemed founder and his group, as well as all the great posters have taught me more, and I feel privileged to have come across it in its relative infancy,than I could have hoped for. I'm more than grateful to all for all their efforts and thank you for it.
Since I appreciate, we're all on some kind of a learning curve as to the "relative" impact of manipulation, supression or any other form of market-rigging practises, which was disccussed here (on the Cafe and GATA) over the last few years, which led most of our study group more decisively to a common understanding of the mechanics and necessities of the "political correct" - however incorrect we feel it may be - patchwork answers of a, or any, fiat money regimes and their respective overstay of their welcome, or better life-time as another friend states.
Since I always felt as being part of a study group, groping for answers in the slow evolution of facts, proving some right and urge others to re-think some of their claims to understanding, I humbly admit to have shed a lot of ballast throughout the term of this noble college, neither Harvard nor Princeton could have had an equal impact.
As I can only speak for myself and at my advanced age I may be slower to digest novel concepts - (as pheraps the language barrier is anotherof my faults)- though digest and grasp the information, so many present here in a casual and selfless way, I came to appreciate and enjoy. Though, I'm not sure if I might enjoy to be forcibly fed the only true concept and vision lately beleaguering this forum- for much longer.
Thank you - cb2
@JMB and Dave CYou do not understand what Pandagold is talking about. And he just can't go much farther to explain himself. But trust me. He is amongst the few people in the know.
While I personally agree with all his arguments, I disagree with his conclusions. Things have been turned upside down several times in times pasts. It will happen again.
Thank you, and some others, for your supportive statements.
Thank you MK (USA Gold) for 'the kindred spirit' endowment
It is good to know one is not 'alone' in this great wide world. I will try, always, to live up to the spirit of the forum, which you so kindly provide, and tilt my lance only at windmills (and gold manipulators)
re: Thank you but your statement: <<>>
I will agree with your statement that I have ecapsulated in normal parenthisis 100%. Please explain, therefore, my conclusions as you see them on which you disagree.
He's a socialist. Or put another way, an apologist for totalitarianism. Oh yes, he's clever about it but I've seen his ilk before. Three squares a day, a little walking around money, forget about God and all is well. When you get right down to it, rather shallow.
I'll bet he's read more books than are available in a small town library....all except one, the all-time best seller....The Bible.
Yup. That's what can happen in a "New York minute", I guess. Now I'll have to go up in the attic and put a bucket under the leak until I can fix the roof.
Thanks for the "Enviro Moment." When I talk about propaganda here, I'm referring in part to the 70s, 80s, 90s commercial (I won't call them "conservative") backlash against the ecology movement. And I thought conservatives were about "conserving" valuable things...
Now, I'm open to hearing examples of elements of that movement being under "special interest" support by others having particular commercial or political agendae, but so far I'm not convinced it is otherwise than citizens acting as they should for the general good of each other and their descendents. You've had some go-rounds, I think I remember, with able posters here who we both value for their integrity and open-mindedness.
One interesting gold-related sidelight would be the new "enviro-goldbug" (all two of us?), who might support the use of gold as real money, while wishing for limits on the more destructive processes of gold mining. It might elucidate the difference between EXISTING gold-in-hand as a valuable resource, vs. gold mining as a dollar-seeking industry like any other. And to help us distance ourselves from infatuation with the "buying stocks" mentality of the 1990s.
In other words, it doesn't matter much what happens to gold mines in the Perfect Economic Storm of the next few years, so much as what is done with the above-ground 130,000 (?) tonnes. Things will be moving too fast to complete all the processes involved in profiting from mining. Thoughts?
Stocks, Lies, and Ticker Tape, Pandagold - currency is the cause, not trade
In your posts there is discussion of displacement of local manufacture by imports due to "free trade".
This is not true!
The actual cause is "Triffin's dilemma", which was actually discovered at least 3 centuries ago, and possibly first formulated by Sir Gresham, the Exchequer to Elisabeth some 450 years ago.
The idea is simple, industry is destroyed at the source of money creation.
If you are in a country that has a wide variety of industries in the days of the gold standard, and there is a huge strike of gold, with more reserves found every year, then money (gold) will be spent by the local owners, spent by the happy miners, taxed and spent by the local government, and would cause an increase in money supply. Local prices would rise well above those in other countries, as a result, the country's exporters will find local labor hired from under them and moving to work the mines or cater to the spending of miners, the mine owners, and the government. The exporters, facing high costs and an attractive local market would stop exporting. Next, import prices, being lower than local prices, would cause imports to flow in, displacing local production.
While artists, shop owners, and service providers might be getting very well paid by the mine owners and their laborers for local services, lavish shows, and construction of megalo-houses, the industrial production of the country would decline and the mechanically inclined local labor once employed in industry would have to convert to one of the booming industries of housing, retailing, broking intermediaries, entertainment, scientific research, spiritual and psychological advice, medical service and medications, and government service.
This will continue until the prices of goods abroad rise to be closer to the prices of goods in the gold producing country. When this happens, the expansion of imports will stop, some imports will no longer be cheaper abroad than when locally produced, and then local entertainers, salesmen, government workers, home builders, brokers etc. will have to find new employment in some of the old mainstay industries that now have to be rebuilt from the ground up.
Dollars:
Now, instead of a mine being the source of money, lets look at the source for today's official international money, the dollar. How and where is a dollar created? Dollars are created by issuing debt � which is done by borrowing for the purpose of spending, investment in capital and technology development, or speculation � or it is done by "printing" of it by the monetary authority, the Fed. Dollars abroad are not borrowed into existence directly, but leveraged in what is a "free banking" system � which is prone to liquidity problems when it expands more quickly than the supply of dollars from exports to the US (the creator of our "gold" in this case), because there is no monetary authority to print dollars outside the US.
Money is thus destined to flow out of the reserve currency issuing country, America. Aside from giving it away, the only other ways of supplying money abroad is by lending it and spending it on foreign investments and imports (produced by the investments abroad).
Imports are destined to flow the other way and to destroy the industrial economy by competition from imports, so long as dollars are used to settle the most necessary trade (oil) by political fiat (an agreement between our creditors, us dollar producers, and oil producers that have our troops sitting around their oil), and there is a need for more dollars abroad. The need for more dollars abroad is a result of dollar debt incurred in the past by developing economies; both in their attempts to buy oil in the 70s, and in their borrowing for capital investment in local and exporting industries in the later 70s and through 1994.
When dollar exports overcome debt service costs to dollar debtors, the dollar will collapse as prices of imports grow to match US prices, while import volumes drop and will start being replaced by local production.
A demonstrative look at recent dollar history:
This is exactly what happened in the course of the development of the dollar reserve system coming out of WWII. This lasted till 1971, when the then exporters to the US, namely Europe, finally reached the point where their loan repayments in dollars were completely supplied by income from their accumulation of American income producing financial assets, and the US suddenly found itself devoid of new oil, which had to be imported in growing quantities � thus suddenly supplying more dollars to the global markets. From that point on, there was no further need for dollars in Europe, and they just dumped into the markets for real goods those dollars they and oil producers got from exports destined to the US. Import prices rose to the sky in the US, and "free trade" became the mantra in order to lower import costs to Americans. Europe and oil lent the money to emerging markets, and China suddenly started opening its doors to trade.
The oil crisis also brought many of the emerging markets to borrow dollars in order to supply their upper crust and local industry with oil. Enjoying the rise in dollar prices of their mainly commodity exports to America, these countries thought that the future would be just roses and daffodils. Then Volcker (and the markets responding to price inflation) raised interest rates to the sky and the emerging markets could not refinance their debts at the old interest rates and could not afford the current rates. The dollar prices of their products no longer rose, and many prices fell. Faced with lower dollar revenues and higher debt loads, they wasted no time in lowering their currency values (by printing up tons of it) till enough real assets were sold to cover debt and export revenues resumed growth through investment by dollar holders from abroad and tremendous growth in export volumes to the US.
Japan, seriously damaged its trade balanced by the sudden rise in dollar costs of oil imports, and made a conscious decision to gain not only enough dollars to cover existing dollar debt service by interest alone, but to be able to buy a year's worth of oil from interest income on US treasuries and real assets, which they quickly accumulated.
Beginning in the 80s, highly efficient cars and installations were put in for oil use around the world, and oil based electricity was replaced by nuclear gas and coal generation.
During the 70s (Japan was still "emerging") and then through the 80s (Japan was now a "mature" economy), exports from dollar indebted emerging markets grew by leaps and bounds to 20 times the volumes of 1971, while dollar prices were stable. Through the 90s, while volumes grew at a similar rate (increasingly dominated by Chinese products) Greenspan's mid-late 90s policy of high "real" interest rates, caused the prices of imports to the US to drop just after Greenspan's low "real" interest rate policy of the 90-93 period had induced massive borrowing by the Asian "tigers", who could not pay the dollars off with the exports they sold the US.
They will only be able to resume high speed growth when China (and later India) can no longer offer cheaper skilled labor or the costs of American distribution and retailing and export transportation (oil to run the ships and energy costs to build new ships) rises to the point of choking further export growth by eating the price margin with the US. Alternatively, they can make a coordinated and concerted effort to lower outstanding debts and raise reserves in dollars till they no longer have to price their exports off of the need for dollars for debt and oil. When this point is reached, they will not need any surplus dollars from the US. The collapse of US energy infrastructure is displacing production of US basic materials to these same emerging markets, which will increase their dollar income more than it will increase their production volumes. The 7% drop in their net debt position is going to be a 10%-12% drop in the next period (assuming stable oil prices under $40) just because of the replacement of production from US basic industries.
When non-oil US import prices stop dropping, the signal will have been given that the colossal debt trap of the past 20 years has been breached and the captured economies are escaping. Oil prices will then rise in tandem with other import prices going up, till the US is producing enough of its energy to cap oil prices.
During the 70s and early 80s, the "median American" lost 25% of his "real income". This round will be worse. With luck, it may fall by 35%-40%, as production of import replacement capital and energy capital will hopefully grow by the time the process hits bottom.
NEW YORK, Jan 30 (Reuters) - The U.S. government will likely ring the death knell for the one-year U.S. Treasury bill Wednesday when it scales back future borrowing needs in the face of growing surpluses. But the 30-year bond, once expected to face a similar fate as government surpluses expanded and debt reduction was derigeur, is now likely to live on with the new administration steering clear of making decisions that could shake the markets until it has had a chance to settle into Washington.
-----------------
Where might future "budget surpluses" come from?
For deeper thought: please consider when it is all boiled down, that a "capital gains tax" can be seen more clearly for most items as little else than an "inflation tax" or perhaps I should say a "currency devaluation tax". You are taxed when it requires more dollars to equal the asset you bought previously with fewer dollars.
The debt payments do destroy dollars, thus cusing a deficit of dollars in the international dollar markets, which drives the need to supply dollars. We fill this deficit with imports of products and exports of dollars - which we create by borrowing for speculation, homes, cars, etc..
The dollars destroyed abroad are replaced with fresh supply from American imports.
The creditors, mainly EU and Japan, have nothing to do with the dollars and use them to buy US assets - both financial and real. Thus import prices fall throughout this process, and asset prices rise. This dollar demand is falling since 1998 and this has caused a stabilization of some import prices. We increase dollar demand (and supply) by the raising of oil prices, which causes foreigners to raise their dollar balances so that they can buy oil.
Sorry, Oro but I never discussed this. None of my postings have discussed 'trade'in this context. I spoke of China, but not with regards to trade, or in anyway that would challenge your ideas expressed in your posting.
I am sure it is a genuine mistake, and I accept it as such
You understand me NOT. Not one tiny bit. You do not even read my posts otherwise you would have seen that I have referred to the book you refer to on more than one occasion'
If you don't read posts properly, then how can you judge?
If you do read them, then your retention of pertinent matter must be like water in a cullinder.
I am no socialist, but to attack a person's religion or politics is a little uncalled for, don't you think?
Have I attacked you personally in this way, though I have read much of your postings I do not agree with?
Lets keep to the spirit of this forum and behave like true knights
Just when I thought I'd close my USAGold window, and get back to work to "improve my dollar balance" like any good exporting nation caught in the debt trap, there you are...
Triffin's dilemma really calls for a stable money supply like no other prescription for an economy's long-term allocation of resources, human and natural. I blush a little when my fellows here call me "Sir" Gresham, for I am the mere shadow of my namesake of long ago.
When you write of economic processes, Oro, I can see that the models which present themselves through you almost require a three- or more dimensional form of writing so that all may be seen in relation. Yet you do a fine job of ordering things in the linear form to which our language limits us, and are an educator of the first rank.
The clarity of your writings, Sir Oro, also helps me order my own thoughts and thence move into those activities I must pursue today. Thank you.
JMB
It's "Christians" like you that make me ashamed of "Christians". I happen to be a Christian, a TRUE Christian does not judge other's the way that you have judged PandaGold. How many people do you think you've "turned off" to the Lord, making asinine statements such as you have made to Panda*? Do you not think you shall pay for such sins? I don't know, I work for a just and fair Lord, it's all up to Him, you know, the Creator of us and gold. I just hope that pandagold does not think all Christians think like you, because they do not. Peace
No, Mercy! ... and some would not think of Snowball's ...
... so, NOMERCY @ Kitco, how big can they (snowballs) get?
Kudos to you Sir, one of the few ami's posters I'm looking forward to see. Merci beau-coup - cb.2
"...I have referred to the book you refer to on more than one occasion."
I read one of your recent posts where you said that you didn't believe in God. That's when I assumed you had not read THE BIBLE. If you do not have a religion how could I attack it? Hey come-on Panda*, lighten up. rc shot DaveC and me a note and I took the opportunity to zing you.
Orville Goldenbacher: Greetings. You gave me a real good butt chewing. Excellent. Thank you, I needed that. But never worry, He will not lose one of His. And Peace to you also.
I appreciate your effort at explaining the ongoing slaughter of manufacturing witnessed by those of us in fly over country. I just do not believe the entire cause is due to "currency", it very well may be the diagnosed disease, but I believe the infirmity was brought on by multiple causes manifesting in "currency"(?) disease.
Your post was food for thought (pun intended). IMHO FOOD is too often overlooked. My nightmare scenario is one of US ag production being supplanted by foreign sources, and the effects upon "domestic tranquility" in response to price hikes or disruption in supply. I recognize that China is increasingly positioning itself to provide such food to be exported to the US. I find the Chinese willingness (and increasing ability) to undercut US ag production in even the most perishable of products disconcerting. Produce that will be shipped from half way around the world!
Beesting earlier posted an excellent example of the Chinese supplanting the domestic honey production. I think most US citizens would be unpleasantly surprized to learn the extent of food imports from outside of the Americas.
I do appreciate your post and look forward to reading and digesting it (I couldn't resist) again!
....I could be wrong, but isn't the new Chinese "physical" gold market supposed to begin this June?? Does anybody know for sure, if it is to be physical only....as I believe, or will they also play the paper game, which would seem unlikely??.....If it is physical, I would find it hard to believe they would price it equivalently to our beloved "paper' market gold....It would seem a physical/paper price split ( so accurately foreseen by Another) would occur immediately....If it doesn't happen before then.......Perhaps, Trail Guide would be so good as to respond with his thoughts, when he has finished cooling off...Which will hopefully be soon :).
I believe it was Another/FOA who liked to say "One gold is coming, my friends"
Sir, if you can find just one posting of mine in which I said, or even inferred, I did not believe in God, I will have USAGOLD dispatch to you a bright shiny GoldPanda if they have one, if not, a Gold Eagle.
If it means I have to not eat for a month, then I would deserve it for making such a statement
(Now that should be worth scurrying through the archives for) I haven't been posting long
Attn All: This is an Official Nomination for ORO's # 46961 to be Included into the USAGOLD Hall of Fame!
Although the title of ORO's 01/30/01 # 46961 could be either: Currency is the Cause,Not Trade!
or
Triffin's Dilemma!
Sir ORO, In My Humble Opinion, you have outdone yourself with this clear and concise(to me) narration of the causes and affects of the worlds flow of money. It took me 30 minutes to read first and reread a second and third time to completely comprehend the post.(This is an extreme complement from me, as I usually cannot take the time to do that on all posts here.) Good Work Brother!
For any new posters here:
A nomination for the USAGOLD "HOF" requires "3" thats THREE seconds from other posters to officially qualify as a post worthy enough to be entered into the list of "Special" posts at the top of this page.My job is to keep track of the seconds.(Real tough job....smile)
Dooo I Heeeaar AAhhh SSeeccooonnndddd Oouuuttt TThheeerrrrree???....beesting.
The things I do for money....all right, let me check and I'll get back to you. I think it was Saturday or was it the Saturday before? Come on, fess up, when was it?
The things I do for money....all right, let me check and I'll get back to you. I think it was Saturday or was it the Saturday before? Come on, fess up, when was it?
You may think I'm being corny or sentimental, but if you think about it, FOA & Michael & Randy set a tone here that is very warm and welcoming. I see people generally responding to it.
The former lurkers who posted to speak with FOA were inspiring.
I thought today about the weird inversions of a web forum from usual life. We are hidden, anonymous, but our words are visible -- totally. Everyone may see everything, and no two may talk "behind another's back." That compels a standard of honesty, and a possibility of trust, that overshadows the possibilities of misunderstanding IMO, unequalled elsewhere in life. Thank you, all.
Yesterday, I posted an attempt at humor which went over like a lead balloon. If the good people at this board were offended by it, then I humbly apologize and ask forgiveness. I was hoping to lighten things up a bit, but I'm afraid I failed. A lesson learned. At my age you would think that no further lessons in life would be necessary but alas, I guess we never stop learning.
I just checked the warehouse stocks of gold & silver over at the Comex. About 25 million oz of Ag eligible, way down from the 100 million or so that I've seen there a few months ago. Au was very low at 91,000 oz. eligible. This is really low isn't it? Does anyone have any data on this? Also no Au in or out this month or so the data seems to indicate. Strange. Anyone out there who could shed some light on the significance of this? Thanks.
In the U.S. Army, you can BE ALL THAT YOU CAN BE! Hear at USA GOLD DISCUSSION FORUM, you can be all you can be plus a little bit extra/more, especially if you have physical! A hearty Thank you FOA and ANOTHER and all the rest of the posters here for the invaluable education in helping me accomplish this goal! Back in the GOLD TRENCH, ACCUMULATING!
David McKay of the South Africa-based Internet
site, www.theminingweb.com. has done a great
profile of GATA Chairman Bill Murphy, based on
an interview done soon after Murphy's arrival
in that country last weekend.
It's headlined: "GATA's Bill Murphy: Fringe lunatic
or golden messiah?"
Thanks so much to www.theminingweb.com and
to McKay for their interest.
You can see that GATA is hard at work at the
gold capital of the world and that South Africa
is listening. This is the start for changing
the financial world.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Thanks. Bottom line is that I'm still $24/oz less in value than when I started this "tour of duty" two years ago. That equates to approximately 8% loss in value. Granted, that's a lot better than some of my friends who invested way too much in those good old tech stocks during the same time frame. But geez, a passbook savings account at 2.5% would have performed better. Oh well, not to worry, just expressing a LITTLE FRUSTRATION (smile)as I'm in this for the very long run. Adios Amigo until I "surface" again.
Oh yeah, here's my contribution to non-related gold topics. I'm rootin for the Texan on the Survivor series (yes, I did keep the TV on after the Superbowl last Sunday). Anybody who brings his Texan flag along as his "luxury" item gets my vote. Hook-em horns.
@PandagoldYou seem to imply that this oligarchy will succeed in world domination and that there is nothing we can do. I disagree because history shows such domination last only so long. Nothing is eternal. And it seems to me that they have already enjoyed their fate for quite a long time. Problem is, it always ends up in disaster.
Just now got a call regarding the possible purchase of our Forge. It's a huge burning bowl with a hand crank bellows, a hood and about 20 very old tools including crucibles with handles.It came with the prperty but Ive never used it.
My problem is i havn't a clue as to what to ask for it. Anyone have any Idea??
Tex, look at your gold. It is exactly the same as the day you bought it. The same weight and purity. The same substance with the exact same use.
Over the two years you've held your gold, the dollar has inflated by hundreds of billions of dollars. Its "purity" has diminished.
It is not your gold that has lost "value".
You may wonder, why then, is the dollar price of gold lower today than when you exchanged dollars for the gold? The answer to this lies in the nature of today's gold pricing mechanism. That is, the price of gold is set within the paper markets (LBMA in London, and COMEX in NY). The rules of these markets allow players (who have no gold to deliver) to sell, in unlimited quantities, that which they do not own.
If one has an urgent need to keep the price low as these players do, and one has the means, through this pricing mechanism, it would be foolish indeed NOT to do what these people are doing.
The question of whether there are limits to this game is, of course, yet to be answered. History, I believe, favors the physical (metal) over the illusion (paper) regardless of how the interim percentages may have looked.
Regards,
Elwood
In your earlier post on the Waco fiasco, there were a lot of inconsistent charges leveled by Janet Reno. She went before the cameras to tell the world that this was a "Dooms-Day Cult" with armories of illegal firearms. When that didn't prove out, she then claimed that they were guilty of manufacturing drugs, which is always an excuse for any reason to invade some ones home in the US, especially when there is no probable cause. Finally, she yet came before the cameras a third time to tell the world that these people practiced some type of ritual child abuse. She never could get her story straight. Finally the whole thing came to an end with a Texas size barbecue. Janet Reno did much the same with protecting those involved such as Lon Horiuchi and others in the government murders of Randy Weavers 14 year-old son and wife on Ruby Ridge (Naples), Idaho. Janet Reno had been more interested in protecting the rights of her fellow(?) lesbians than the rights of anyone she considered right-wing, conservative, or who just didn't believe the same.
I love to pontificate over nothing, as if anyone listens. Ah, but in my dreams there are tens of millions, instantly enlightened when I speak. But now where was I?
Oh, yes. Sir rc, it seems to me that Pandagold's perspective on TPTB are far-reaching, and may parralel what the Bible says of the coming resurrected Roman empire, the beast with feet of miry clay and iron, a last empire formed of the nations, and from which will come one world government, one world currency, and one world religion.
Regardless of what we think, this will happen, for the future event has been written about already in the past tense. Just like hundreds of years before Cyrus was born, his name was written into Isaiah, naming him as the one who would overthrow Babylon, that great unpenetrable city of the ancient world.
But after saying that, I have to wonder if we are not supposed to stand aginst the forces of darkness, (ala GATA), but are merely to watch like passive sheep while someone steals our freedom, and we dont resist, because after all, its prophecy coming true, and you cant fight the book, you know.
Or are we to occupy till He comes, and stand our ground?
And what do they think of themselves, those who are hard at work, pushing the NWO? I'm sure they have heard all about the prophecies already, whether beleivers or not, and perhaps they think they are actually the instruments of God, for they are fufilling prophecy in bringing about the one world government!
Here's a tip, that I hope is true, that in March, the GATA lawsuit goes to court, and Al G. will testify, along with GS and Chase. This will make national network news, and may shake up the paper POG, regarless of the outcome of the lawsuit. Keep your eyes peeled!
RE: ORO (1/30/2001; 10:16:42MT - usagold.com msg#: 46935)
I think that you are generally correct. I think that the letter to Gray Davis was to point out that the increase in the state population whether by birth rate or immigration, is a severe draw on the states' resources. The state of course never planned on taking care of its own needs, but rather made the conscious decision to consume the resources created by others. That's the reason that I refer to them as Grasshoppers. Now that those resources are in short supply, the people in other states are forced to sacrifice for these Grasshoppers (perhaps we should refer to them as leeches). The Grasshoppers had ample opportunity to prepare for such an obvious disaster. Yet, they did nothing but "�dance, sing, and play all summer long�" so to speak. I can not have any sympathy for such arrogance.
As far as nuclear, coal, and oil power are concerned, these freaks of nature won't allow it until they have no power and the other western states are free to withhold energy for their own needs. The Grasshoppers still don't even believe that there is a problem. They believe (according to the polls) that this power crisis is a contrived ploy by the big bad power companies in order to raise rates. George Dubya and Dick Cheney have the right idea when they say that it is their problem and they should fix it.
Of course you are right that they will slip across their borders into other states. They already are doing this. The business districts in the northwest, Idaho, Utah, and Arizona are experiencing an influx of companies that are relocating. That's also the reason we refer to hordes of Grasshoppers as a "plague."
NEW YORK -- A decline in U.S. natural gas production during the fourth quarter may spell trouble ahead for 2001 production growth. While the tally isn't complete, the fourth-quarter numbers from the major oil and gas producers that have already posted results show an overall decline in natural gas production from the third quarter. The production slump is startling because it is counterintuitive, coming at a time when gas demand is growing, prices are strong, and the number of rigs drilling for natural gas is at a record level. 'I think given the robust commodity price picture that we have been seeing, the sequential decline in natural gas production so far is a little bit troublesome,' said Lehman Brothers Inc. analyst Paul Cheng. Most would expect oil and gas companies to produce more gas when prices are strong, but some believe the last industry downturn had such a negative effect on the industry that many companies remain averse to risk. While there is plenty of drilling activity, the gas reserves being targeted are smaller in size and the decline rates are greater, said David Pursell, an analyst at Simmons & Co. International in Houston. Judging by the reduction in dry hole expenses, it appears that companies are drilling wells in the same geographic areas that have been reliable producers in the past. The problem with that strategy is the remaining reserves in a region tend to dwindle over time. A decline in dry hole expenses, which are write-offs for costs related to an unsuccessful well, usually indicates fewer exploratory wells are being drilled, Pursell said. 'You have to ask, when are you going to put the 'E' back in 'E&P' projects,' Pursell said, referring to the need for new exploration to create production growth.
At Texaco Inc. (TX), two-thirds of the drop in fourth-quarter U.S. gas production from the third quarter was attributed to the natural decline rate of its wells, said Paul Weeditz, a spokesman for the White Plains, N.Y., energy company. Sales of gas-producing properties accounted for the remainder of the decline, he said. Looking ahead, Texaco expects to maintain U.S. gas production at its current levels, Weeditz said. At Chevron Corp. (CHV) asset sales were the reason for the quarter-to-quarter decline in U.S. natural gas production, said company spokeswoman Bonnie Chaikind. Excluding asset sales, gas production was flat sequentially, she said. Lower Spending May Have Sped Up Decline Rates Also, lower spending on well infrastructure during the last oil industry downturn in late 1997 to 1999 may have accelerated the decline rate of some reserves, said Tyler Dann, an analyst at Banc of America Securities LLC. He likened the industry's situation to the difficulty one encounters trying to get back on a moving treadmill after stepping off the machine.
Furthermore, the large oil and gas companies have shown an unwillingness to increase price expectations in the budget process, Dann said. As a result, some exploration projects that would be economically feasible under current prices won't be pursued because of the tough financial criteria. This is especially important because there is a growing opinion that natural gas prices will settle at a higher average level in the future. 'If the new 'plateau' for natural gas prices is higher than what consensus projects it to be, then energy companies need to increase their leverage to natural gas production around the world,' said Gene Pisasale, senior energy analyst at Wilmington Trust. But this isn't likely to occur overnight. Late in the fourth quarter, Exxon Mobil Corp. (XOM) took steps to increase its gas production by maximizing production of natural gas rather than liquids at its U.S. gas plants, said company spokeswoman Suzanne McCarron. The Irving, Texas, oil and gas giant also expects to increase its spending 15% to 20% from 2001, McCarron said. How much of the increased spending will translate into higher production, is the big question, said industry observers, who have watched oil companies get less for their money in 2000. In an estimate Pursell describes as aggressive, the analyst predicted the industry's U.S. gas production in 2001 will rise only 2%.
Looking further ahead, the situation may improve. 'According to both private sector and government estimates, it appears that considerable new supplies of natural gas will come on line in 12 to 24 months,' said Rhone Resch, a spokesman for the Natural Gas Supply Association, a Washington, D.C., trade group for gas producers. The caveat there is that many of the estimates Resch is quoting depend on the Bush administration's willingness to open lands controlled by the federal government, mostly in the Rocky Mountains and the eastern Gulf of Mexico, to drilling.
Black Blade: Without the exploration for natural gas and the depletion of currently active fields, the price of natural gas will likely be on the increase again soon. Last year rates went up in the summer months as electricity was drawn in the midwest for air conditioning. There were power outages and several deaths. This summer could be a repeat. The summer months have been usually reserved for building up NG storage. Now with increased electricity demand, those storage fields are not refilled as they once were. We may yet dodge the bullet this winter and some apparently agree as NG prices have fallen back to about the $6.00 Mbtu level. However, with lower NG reserves, these prices could rocket even higher. We could likely see a lot of death and suffering this summer as well as next winter.
View
Yesterday's Discussion.
NEW YORK (Dow Jones News) - Crude futures ended flat at the New York Mercantile Exchange Tuesday. Trading was mostly calm throughout the day, with a modest last-minute flurry of buying, ahead of the release of weekly inventory data. March crude closed unchanged at $29.06 a barrel. Heating oil futures dropped on warmer weather forecasts, with the nearby February contract falling 1.17 cent to 80.03 cents a gallon. February unleaded gasoline rose 66 points to 88.20 cents a gallon. Natural gas for March delivery fell 3.9 cents to $6.097 per 1,000 cubic feet.
The American Petroleum Institute report for the week ended Jan. 26 showed U.S. crude inventories declining to levels comparable with year ago stockpiles. Distillate fuel inventories, which include heating oil and diesel fuel, decreased marginally. Crude inventories fell 5.6 million barrels to 282.8 million barrels, compared with 282.6 million barrels a year earlier, API reported. Distillates were reduced by 425,000 barrels to 113.7 million barrels, slightly higher than year ago levels of 111.9 million barrels. Inventories of motor gasoline, whose demand declines during the winter, rose more than 6.5 million barrels to 206.7 million barrels, or 8 million barrels higher than last year at this time. In London, Brent crude from the North Sea rose 29 cents to $26.89 per barrel.
Black Blade: Inventories are down overall. The real story continues to be NG though. Iraq is back to producing oil as the other members of OPEC feared. This will mean that OPEC will likely meet to cut back production again as we head into summer "driving season." BTW, isn't someone supposed to cough up 3 million barrels to replace the SPR oil? Could be a problem ;-)
HOUSTON (Reuters) - A shouting, crying Anna Nicole Smith, in a bitter twist to a sometimes comic trial over the billion-dollar oil fortune left by her 90-year-old husband, charged on Tuesday that his son had wanted him to die.
Smith, a former Playboy Playmate of the Year, said son Pierce Marshall had issued orders not to help the debilitated J. Howard Marshall if he choked on his food, as he did one night when Smith fed him chicken soup that almost killed him. ``That's the night he died on me and I brought him back to life,'' she cried out. ``It was Pierce -- Pierce was the one who made the order not to do anything because it wouldn't do any good.'' ``He killed my husband,'' she said. Pierce Marshall's attorneys were quick to point out that the elderly Texan's death, in August 1995, was caused, not by choking, but by congestive heart failure. Smith married J. Howard Marshall in 1994, when she was 26 and he was 89, after he fell in love while watching her dance at a Houston topless club. Rusty Hardin, Pierce Marshall's attorney, told the court that his client had given his father the best possible medical care. ``Do you seriously swear under oath that Pierce Marshall ordered people to let his father choke to death?'' he asked Smith incredulously. ``Yes,'' the 33-year-old Smith replied, wiping her eyes. ``Miss Marshall, have you been taking new acting lessons?'' Hardin asked. ``Screw you, Rusty,'' she said in one of many angry exchanges between the two.
Case Pits Son, Widow Against Second Son
Pierce Marshall, 62, controls his father's estimated $1.6 billion fortune and is trying to keep Smith and his older brother, Howard Marshall III, from getting any of it. He has accused Smith of being a gold digger and said his brother was excluded from his father's will because of a business dispute. Smith, a Texas native who lives in Los Angeles, dropped out of the lawsuit last month after a California bankruptcy judge awarded her $475 million of her husband's money but was called back to testify by Pierce Marshall's attorneys. They believe her testimony will help their case against Howard Marshall. Hardin spent most of Tuesday trying to discredit Smith, who said she married Marshall for love, not money, but admitted receiving nearly $7 million in cash and gifts from him before his death.
Hardin painted a picture of a marriage in which Smith constantly took money from Marshall, ignored him when he visited her and had an affair with her bodyguard under her husband's nose. But Smith, clutching a photo of Marshall, said he and she had loved each other and had had a sexual relationship despite his age and physical problems. In describing a typical night with her husband, she said, ``We probably had sex, and then we went to sleep.'' ``You and Mr. Marshall?'' Hardin, again incredulous, asked. ''Mr. Marshall was 89 at the time, was he not?'' ``Yes,'' Smith said, without elaborating.
Black Blade: Ah yes, True love! OK, a bit off-topic, but there is a reference to "Gold-Digger." I guess as long as he died happy ;-)
Then again, demonstrates the need for good estate planning. Passing along gold to ones hiers not only avoids the hassles like this, but also the taxman if you get my drift.
The Vice President of the American Gas Association told lawmakers Monday that production of natural gas is headed up. The huge price increases that have devastated residential users this winter are largely blamed on shortages of the fuel. Higher gas prices have encouraged more drilling. As a result, the industry is projecting an increase of more than 5 percent in gas supplies this year. "As of six months ago, they were projecting a much smaller increase. So they do see this drilling boom is bringing more gas on the market. But essentially we are in a very tight race right now. We're in a tight race between increasing demand and increasing supply. And the supply market's trying to catch up with the demand market," American Gas Association vice president Roger Cooper said.
Cooper didn't make any projections on how this new supply would affect retail prices.
Black Blade: 5% is simply not enough. With decline rates and no new "EXPLORATION" there will simply not be enough NG to meet demand. Virtually all new power plants being built and coming on line are NG-fired.
I just finished reading a report on the northwest energy projections. There are serious concerns about the ability to produce power in the northwest due to low water levels and the lack of precipitation this winter. The report sums it up with a statement from Dick Watson of the Northwest Power Planning Council : "It's going to be one ugly summer." It appears as if the Kalifornian economy is toast after all. Ratepayers from neighboring states are quite irate with the state of Kalifornia. In Arizona, retirees were told to expect 300% rate increases soon. There are some protests being planned with their anger focused on Kalifornia. In another report, I read that there are now problems with "Deep-Water" and "Ultradeep-Water" drilling projects as the ambitions of big oil companies are out distancing the technology. It seems as if all but one project came in on time, they average 35% over budget, large scale shut-off valves not working at great depths and there are a lot of other equipment failures. It looks as if there will be no more return to cheap oil and cheap energy. There are going to be some very serious problems for the economy going forward.
THE UNDERESTIMATED RECESSION WILL BE LONG AND SEVERE
Mount Kisco, NY, January 26, 2001� Recession, which began in November, will not end, at the earliest, until 2002 and will have unfortunate consequences that will last for years, according to the latest issue of The Levy Institute Forecast and Macroeocnomic Profits Analysis. The "underestimated recession" is a product of long-developing imbalances between the size of the economy and the magnitude of its debt and fixed assets, asserts the Levy Institute Forecasting Center, which publishes the monthly report.
"The current situation also has a particularly threatening feature: the pathologically inflated corporate equity market," notes the Levy Forecasting Center. The economy's total asset value relative to income is much greater than on the eve of the 1989-93 period of financial trouble, when the 1980s real estate bubble was coming undone. The economy's vulnerability to a stock market decline is unequaled in U.S. history, according to the Levy Forecasting Center. "Overall, the present situation involves the most formidable financial dangers since the 1930s."
Since recessions are always at least several months old before they are commonly recognized, it is not surprising that debate is underway about whether the economy is experiencing a soft, bumpy, hard or crash landing. The Levy Institute Forecasting Center invokes a metaphor it coined in the 1950s, to describe the transition from prosperity to recession: "When a long train rounds a curve, the locomotive completes the turn while the caboose is still traveling in the orginal direction. Similarly, some economic activities have begun to contract while others are still expanding."
David A. Levy, director of the Levy Institute Forecasting Center, reminds readers to "Respect the danger of the developing financial and economic storm."
*****************************
The Levy Institute Forecasting Center's list of 10 developments to watch in the early �00s:
1. 2001 profits decline will be steep.
2. Recession and financial crisis abroad will last longer and be more severe than in the US.
3. Economic woes in countries such as Japan, China, and Russsia may have political consequences.
4. As the recession deepens, the record US trade deficit may impact trade and international relations.
5. The recession will have a domino effect that will cause a 2-3-year long credit crunch.
6. Modest deflation in goods and services prices may develop by 2002.
7. Interest rates will plunge.
8. Federal fiscal policy, especially income tax rules, may have a major effect on the economy of 2002.
9. The timing and extent of the consumer pullback will affect the depth and duration of the recession.
10. People may discover that the Fed is not omnipotent.
NYMEX "DEFAULTS" ON PALLADIUM CONTRACTS! - Covers their A** with Margin Increases!
NYMEX Announces Series Of Palladium Margin Increases
NEW YORK, NY, January 30, 2001 -- The New York Mercantile Exchange, Inc., will increase the margins on its February and March 2001 palladium futures contracts as of the close of business on February 2, 9, and 16.
At the close of business on February 2, clearing member margins will be increased to $30,000 from $15,000, member margins will be increased to $33,000 from $16,500, and customer margins will be increased to $40,500 from $20,250.
At the close of business on February 9, clearing member margins will be increased to $40,000 from $30,000, member margins will be increased to $44,000 from $33,000, and customer margins will be increased to $54,000 from $40,500.
At the close of business on February 16, clearing member margins will be increased to $50,000 from $40,000, member margins will be increased to $55,000 from $44,000, and customer margins will be increased to $67,500 from $54,000.
Black Blade: So it goes again. It was sort of expected as the Russians simply don't have any left. The price of palladium has come down some as a result of the NYMEX margin increases. They will do the same for gold and silver should there be a huge interest on those metals. In effect, the NYMEX is back into "default", only they are covering their tracks with margin increases. Dishonesty and corruption are pervasive on NYMEX as well as the TOCOM markets.
http://www.suntimes.co.za/zones/sundaytimes/business/business980923586.asp South Africa's AngloGold, the world's largest gold producer, says most commentators see the gold price in a stable state, with small likelihood now of radical weakening. In a statement accompanying December quarter results, released on Wednesday, AngloGold said evolving circumstances in the currency and interest rate markets are likely to support gold, but the absence of investment interest in gold remains the most important factor in the current price trend for the metal. "With solid physical support underlying the market, there should be opportunities for the price to rally in response to favourable news from other markets from time to time," AngloGold said. In its review of the gold market for the December quarter, AngloGold said the spot gold price at the close of the fourth quarter of 2000 was $272 per ounce, almost unchanged from the price at the end of September.
However, the market was under pressure for most of the quarter, and the average price of $269 per ounce for the quarter was 2.5% lower than the average of $276 recorded for the third quarter of 2000. Much of this weakness came from short-term speculation against the gold price in the wake of the short-lived official intervention on behalf of the euro in late September/October. The intervention lifted the euro against the US dollar, and with it the spot price of gold, but selling by funds and speculators started immediately and it became clear that no intervention would be sustained. For the quarter, the gold price traded within a $10 range between $275 and $265 per ounce. Since the end of the quarter, however, the New York Comex has reported increased short selling of the metal, and the price tested resistance below $265 per ounce, before short covering pulled the price back within the trading range for the quarter.
As has been the case for some time, the currency markets remained more active than the gold market, AngloGold said. The US dollar maintained its dominance for much of the quarter, but began to show signs of weakness in December. This weakness has continued into the new year, and is reflected in comfortable gains by both the euro and the Australian dollar. However, whilst the South African rand suffered from the strength of the US dollar, it has not benefited particularly from the recent weakness of the US currency. The fourth quarter saw the rand fall to a low of R7.85 against the dollar, and trade at an average exchange rate of R7.60 compared with R7.00 for the third quarter of the year. Since the end of 2000, there has been active speculation against the rand that took the local currency at one point to a new record low of just over R8.00 to the dollar. It has since stabilized in a range between 7.80 and 7.90. South African gold producers benefited from this currency move as it offered protection from the weaker dollar price of gold. The average rand price of gold for the final quarter of 2000 was R65 759, up by almost 6% from the average local price of R62 176 per kilogram for the previous quarter, AngloGold said. - I-Net Bridge
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Black Blade: Good news in spite of this hedge fund recording a loss this last quarter.
US Dollar Weakening, Possible Higher Rate Cut?, and Gold Creeping Higher.
http://www.mrci.com/qpnight.htmEuro is stronger and USD weaker. Expectations are that the USD will weaken over the next three quarters. Yet the Brit, Canadian, Aussie and Nippon pesos are tumbling as well. The question is will today's rate cuts help/hurt gold? Some even expect that Cheeta and the other jungle critters will throw Wall Street a bone with an even higher rate bonus of 75 bp cut. Meanwhile, gold is marginally higher - up +$0.35 over the NY close.
Hear ye! Hear ye! "2001: A Gold Market Odyssey" The panel of judges have spoken!
http://www.usagold.com/hall/odyssey2001.htmlFirst, allow us to assure you that we appreciate the time and thought that is put into the development of these posts revealed by the weighty task involved in reviewing and absorbing the contents and wisdom found within each one. Were that not formidable enough, choosing the "Best of Show" poses an additional challenge from which we're sure even Sir Edmund Hillary would likely shy away. But somehow the deed must be done, and so it has been. We are pleased to award the gold prize (20 franc French rooster coin) to Sir Black Blade, followed closely by Sir Peter Asher, our first runner up silver Eagle winner. Rounding out our list of metal winners is Sir SEER, claiming the second runner up silver Eagle for a rare display of creative talent in which the resultant work of art is so clearly seen to imitate life.
Taken together, Sirs Blade and Asher make a solid case for a gold rally occurring this year due to changes in the relationship between Washington and New York amidst an unfolding energy crisis that none-too-shyly reaches out to remind us each and every day that things are not as they once were just a few short months ago. And while this case alone is compelling, there are a great many conspiring factors -- acting on stages throughout the world -- each whispering independently that the time is nigh for gold to shine brightly once again on the financial scene.
All that is required to convince yourself of the magnitude of this problematic potpourri stacked against our economic status quo is a cursory review of the many other commentaries posted in response to this call to contest, and notably among them the two Honorable Mention posts by Sirs Simply Me and ET. And while we once again affirm that all posts were insightful and worthy of careful attention, we felt it useful to give the special nod of Honorable Mention also to Sir AUgustUS for reminding us all to recognize the important distinction of "value" over "price". When one understands "value" -- or make that "need" -- then "price" becomes a secondary issue in importance, and that is how physical gold, an uncheat-able savings asset immune to default, may achieve astronomic numbers in terms of exchange with paper currencies as already seen in many nations worldwide.
Congratulations to all! And come what may, let us hope the course of the year allows us all to welcome 2002 with better health, happiness and financial security than that with which we confidently entered 2001.
(see link above for the collection of posts)
Final word to the new posters: As we indicated last Friday when we announced the winner of the COMEX price-aiming contest, anyone making their very first post to the forum during the contest period of January 19th - 23rd may qualify for a complementary silver Eagle courtesy of the generosity of the fine folks at Centennial headquarters. All you are required to do to claim your metal is to email Jill (jill@usagold.com) with the date and msg# of your first post. Upon verification that this is indeed your first appearance at our Round Table, the coin will be sent to you on the next available pony.
I am fairly convinced of this also. As I mentioned in an earlier post, the increasing amount of media programming seems to be focused on a particular aspect associated with the Nazi era. This, to my mind, is being overdone to a point where it can have only one function, and conclusion It is far from entertainment), there is fear that the conditions could become that bad that certain events could be replicated.
There is awareness and anger by many just simmering below the surface.
There should be no need to explain to those with a wide open mind,
Consolidated weekly financial statement of the Eurosystem
Week after week the gold assets held on the ECB's books hold rock steady, again at 118.611 billion euros in value for the weeekly financial statement for the week ending January 26th. A change is not likely until either the next quarterly mark-to-market revaluation (March 30th), or until Austria or the Netherlands begin to direct the BIS to reallocate some portion of the 50 tonnes allowed to them this year under the Washington agreement...(perhaps in satisfaction of the metal requirements for the Bundesbank's commemorative gold Deutschemark coin program proposed for this year).
In what has become a rare event, the ECB's net position in paper assets (denominated in foreign currency) joined the metal in remaining unchanged for the week, totalling 260.9 billion euros in value.
MK, Randy, and all you Nights and Ladies in the Castle, I'm shocked, pleased, and humbled. Thank you very much. I will certainly find a place of honor for this golden treasure. We can see the changes that are occurring before us as the economy comes under pressure from several directions. Lately we have seen rising energy costs, increases in the earnings warnings from industry, the collapse of the speculative Dot.Com bubble, increasing numbers of lay-offs, a FED chairman who now admits that there are some problems, a new administration in Washington to pick up the pieces, the lowest consumer confidence numbers in years, etc. The list could go on forever. The security of gold is timeless! Again I thank you!
http://biz.yahoo.com/rf/010130/n30390549_4.htmlTreasury Secretary Paul O'Neill said on Tuesday, "I don't think we can have an endlessly growing current account deficit, but do I want us to become a less friendly place for capital? No, absolutely not. I want us to become the preferred investment haven of the whole world."
And on the tax cut vs. paying down the national debt: "We think that we can fit all these things together and that we're not going to throw ourselves back into a deficit position by doing these things."
Smaller dollars do fit this second equation, but not the first, if you ask me.
What is the U.S. to do? Reuters reports:
------Participants at the Davos World Economic Forum in Davos, Switzerland, on Monday called on the United States to do more to stimulate its economy in order to stave off a potential global slowdown.
+
The new U.S. Treasury chief, formerly chairman of metals giant Alcoa Inc., said he thought it would be "highly desirable" for Japan's economy to grow more rapidly, as it did in the 1970s and 1980s. His comments echoed years of U.S. urging for Japan to do more to spur its languishing economy---------
*sigh* Shades of Japan...just another brick in the wall.
Demand for back up generation creating backlog
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Demand for back up generation is growing so fast in California manufacturers are hard pressed to keep up and some consultants report they can't find the equipment on the West Coast. The highest demand is from businesses with
interruptible power contracts. But others are also installing the equipment to avoid being shutdown during involuntary outages as the state struggles just to keep the lights on. With margins teetering at 1.5%, the California Public Utilities Commission has refused to allow businesses in the interruptible program to opt out.
Most of the 1,000 businesses signed up for the programs have experienced more outages and business downtime than they ever anticipated under the tariff. The interruptible program for Southern California Edison Co. involves 1,200 Mw in winter and 2,400 Mw in summer. Pacific Gas & Electric Co.'s 400 Mw program has already expired.
Interruptible load customers agree to have their electricity cut off for a limited number of days in return for a lower year-round tariff. The extra power has proved indispensable to the California Independent System Operator to prevent an electricity emergency from deteriorating into a full-fledged black out. However, businesses on the tariff have been cut off as much as 18 hr/day, sometimes for several days running, during California' ongoing power crisis. Many are growing weary of the economic losses from shutting down day after day. "Our customers can't stand to have any more interruptions," says Brennan Higgins, energy consultant for Summit Energy Inc. in Louisville, Ky. Higgins is advising some of his large customers in California to rent or buy utility grade diesel generators. "If there is a curtailment, they can ride through it at about 15 cent/kw-hr," he says. But utility grade generators are hard to find because of the increased demand created by California businesses and other regions where there is a perceived threat to electric reliability. Higgins could not find generators for clients in California except on the East Coast.
Nowhere in California
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
"You can't find them anywhere in California," he says. "The gen sets out East are heading West." Rachele Kunz, spokeswoman for Caterpillar Inc., said demand for diesel power generators is the fastest growing part of Caterpillar's business. She confirmed the company's generators are on back order and production is running at 100% of capacity. But she declined to disclose details about the length of backlog or other production information.
Businesses on the interruptible tariff in Southern California Edison's territory can be called at any time. Uncertainty and worry about an even tighter power availability for the upcoming summer has big users like aluminum wheel manufacturers and glass makers shopping for generators. Higgins says he is preparing power strategies for clients early because summer forecasts suggest the situation will not improve. Meanwhile, companies must wait several months for permits to operate 1-2 Mw diesel generators. Generator sets that operate longer than 200 hr/year get approval from the state air quality boards, but no other regulatory approvals are required.
Under the interruptible program's guidelines, customers can be asked to reduce usage 30 times/year or 100 hr/year. Pacific Gas & Electric Co. said its 2001 interruptible customer program (north of Kern County) has already been exhausted. The California utility has about 170 commercial and industrial customers that voluntarily signed contracts to participate in the program.
Sources close to the issue expect state government to require by executive order that businesses already signed up on interruptible contracts continue participating in the program whether they want to or not. The PUC has postponed until "further notice" its report on interruptible load programs and emergency curtailment plans.
Black Blade: You really need to re-read that last paragraph! If you read between the lines - the situation is beyond critical! This is going to get extremely ugly as the economy of California is huge and will have "Ripple Effects" across the whole country. This is only the beginning of our energy problems. It's truly a shame that the state of California let this get so far out of hand, especially since everyone could see it coming. "Benign Neglect?" No, just laziness! (Refer to Aesop's Fable - "The Ant and the Grasshopper").
Also this caught my eye:
With gas and power bills rising, a Texas lawmaker has introduced a measure allowing the Public Utilities Commission to delay the scheduled 2002 start of electric competition, if state regulators determine the necessary elements for 'fair competition' are not in place. Texas State Rep. Sylvester Turner, a Democrat, said the measure is insurance against a California-style debacle erupting in Texas after deregulation goes into effect.
Black Blade: They don't have as much to worry about as there are 27 new power-generating plants coming on line in Texas with an additional 20 or more being planned and built. They are also drilling and producing Hydro-Carbons. Heck, they are even building a "Wind Farm!" Remember during the presidential election, the environmentalists were deriding George Dubya because Texas has some dirty air? At least Texas still has the lights on. California Grasshoppers and Texas Ants? Hmmm�
Crude Oil: The March contract for US benchmark crude lost 39� to $29.80/bbl and the April contract was at $28.86/bbl. Analysts said resumption of Iraq's crude exports from a terminal in Turkey after 3 weeks of suspensions had a bearish influence on the market.
In London, the March contract for North Sea Brent crude closed at $26.53/bbl on the International Petroleum Exchange, down 51� after trading as high as $27.28/bbl Monday. Participants said Brent futures in excess of $27/bbl were excessive, despite recent strong demand resulting from severe winter weather in the US and Europe.
In his weekly radio program, Venezuelan President Hugo Chavez said OPEC's recent decision to reduce its production "was a necessity, and we will continue attentive to the daily movement of the price of crude on world oil markets."
While US Energy Secretary Bill Richardson was making an unsuccessful eleventh-hour effort to talk OPEC leaders into sustaining high production, Chavez was meeting with the heads of government of OPEC members to hammer out agreements for a 1.5 million b/d reduction. The cut would lower output to 25.2 million b/d.
The export price of Venezuela's oil basket last week closed at "almost $23/bbl" above the lower end of the OPEC price band. Venezuela's national budget for this year is based on an oil export price of $20/bbl. However, Chavez said, "For us, an average of $25/bbl in the year is a fair average for our oil.
Natural Gas: Falling spot and futures prices reached levels not seen since late November or early December. After cooler temperatures over the weekend, the latest NWS near-term temperature forecast of a warmer trend could exert further downward pressure. California's energy crisis worsened, making the future for natural gas consumers there even more uncertain.
The pace of storage withdrawals slowed for the second week in a row, as the American Gas Association (AGA) estimated a total draw of 103 Bcf for the week ended Friday, January 12. This is the lowest withdrawal estimate since the week ended Friday, December 1 and is 26 percent below AGA's average for this week in the AGA's 7-year data series.
After the pause in trading for a week ago Monday's holiday, cash prices resumed their steady decline through last Thursday at virtually every location tracked by Gas Daily outside of California. In California, where rolling electricity blackouts began Wednesday, prices on the PG&E system increased on Wednesday through Friday, as every available gas-fired electric generator was brought on line, and PG&E announced that up to two-thirds of its gas supplies were in jeopardy.
Black Blade: AGA's NG inventory statistics for last week will be released later today. Look for OPEC to set another meeting soon.
E source Reliability Study Reveals a Grim Reality for California Businesses - Financial Impact of Blackouts Is Staggering
http://biz.yahoo.com/prnews/010130/co_e_sourc.html BOULDER, Colo., Jan. 30 /PRNewswire/ -- According to a study released by E source, the impact of financial losses
resulting from recent blackouts in California will be unparalleled in the history of the state.In ``Reliability in the Emerging Electricity Marketplace: The End-User Perspective,'' E source investigated the costs and frequency of power outages from the customer's viewpoint. Respondents from a cross-section of market sectors attested to
experiencing an average of 17 outages over the past 12 months. The majority of those incidents lasted only a few seconds or less. Although such incidents might fail to register on utility radar, to more than 30 percent of utility customers, these brief outages are both costly and disruptive to their businesses. Three sectors in the study -- financial services, continuous-process manufacturing, and agricultural food processing -- reported outage-related costs in the range of $60,000 to $80,000 per year.
If the cost of these brief outages is extended over the long, rolling blackouts being experienced in California, it's easy to understand the devastating impact these service interruptions are having on businesses there. Several of the recent outages have lasted anywhere from 30 to 90 minutes, potentially costing customers seven times as much as the more common outages of a couple seconds or less. The E source report estimates outage costs for the entire sample population by multiplying annual figures times the number of businesses within the defined market sectors and company size ranges. In the continuous-process manufacturing sector, for example, the estimate of routine losses comes to more than $3 billion annually across the U.S. The retail sector is estimated to be losing around $1.25 billion annually as a result of outages. Bill LeBlanc, Vice President at E source, notes, ``Although it is difficult to determine actual figures on losses, we estimate that if all medium to large business in California were without power for two hours each, the accumulated losses could fall in the range of $500 to $750 million.''
LeBlanc adds, ``Approximately 13 percent of the customers we sampled were interested in purchasing additional backup generation. We also found that frequent or lengthy outages nearly doubled the propensity for a given customer to purchase backup power. We expect that customers in California are about to experience a sharp increase in their willingness to buy some type of generator.'' E source is watching closely to see how customers in California go about trying to fix their immediate problems. Will they focus on political activism, as customers have in the City of San Francisco, or will they simply buy up thousands of backup generators and new microturbines to create their own islands of power? E source predicts that events in California will serve as a powerful catalyst for both movements.
For further information, please contact Bill LeBlanc at 720-548-5476 or Jim Keener at 720-548-5624.
Black Blade: Well here it is! Its Begun! Businesses are beginning to own up to the losses and impact of the energy crisis. First Cheeta goes ape in the senate and spills the beans about energy, and now business getting scared.
JMB
Perhaps Michael is simply replenishing his inventory in anticipation of next month's sales to forum members.
Gold is like tax deductions. You can't have enough.
Rich
@Dave CWhy on earth do you believe that, when somebody says something you dislike, he is insulting your intelligence?
As for Clinton, I agree with Pandagold that he is the tool used by the real rulers to suit their own purposes. That Clinton deserves pity is another matter. Pandagold has been a little too lenient here.
And so you do not understand what I am talking about? No I won't explain. My opinion is you may be smart but you are not learned. At least with regard to some aspects of recent history.
Folks, this may be, for inductees, one of the very few avenues left to immortality in the U.S.of A. currently without any form of monetary compensation as a motivating factor......
Wouldn't all of us like to see Sir ORO's name up there right between Babe Ruth & Ted Williams...Ohh..Sorry....Wrong Hall of Fame....
Here is a reprint of ORO's 46961 from 01/30/01.
If you've already read it please skip to the next post.
If you think it worthy of USAGOLD's HOF please second it.
ORO (01/30/01; 14:43:09MT - usagold.com msg#: 46961)
Stocks, Lies, and Ticker Tape, Pandagold - currency is the cause, not trade
In your posts there is discussion of displacement of local manufacture by imports due to
"free trade".
This is not true!
The actual cause is "Triffin's dilemma", which was actually discovered at least 3
centuries ago, and possibly first formulated by Sir Gresham, the Exchequer to Elisabeth
some 450 years ago.
The idea is simple, industry is destroyed at the source of money creation.
If you are in a country that has a wide variety of industries in the days of the gold
standard, and there is a huge strike of gold, with more reserves found every year, then
money (gold) will be spent by the local owners, spent by the happy miners, taxed and
spent by the local government, and would cause an increase in money supply. Local
prices would rise well above those in other countries, as a result, the country's exporters
will find local labor hired from under them and moving to work the mines or cater to the
spending of miners, the mine owners, and the government. The exporters, facing high
costs and an attractive local market would stop exporting. Next, import prices, being
lower than local prices, would cause imports to flow in, displacing local production.
While artists, shop owners, and service providers might be getting very well paid by the
mine owners and their laborers for local services, lavish shows, and construction of
megalo-houses, the industrial production of the country would decline and the
mechanically inclined local labor once employed in industry would have to convert to
one of the booming industries of housing, retailing, broking intermediaries,
entertainment, scientific research, spiritual and psychological advice, medical service and
medications, and government service.
This will continue until the prices of goods abroad rise to be closer to the prices of goods
in the gold producing country. When this happens, the expansion of imports will stop,
some imports will no longer be cheaper abroad than when locally produced, and then
local entertainers, salesmen, government workers, home builders, brokers etc. will have
to find new employment in some of the old mainstay industries that now have to be
rebuilt from the ground up.
Dollars:
Now, instead of a mine being the source of money, lets look at the source for today's
official international money, the dollar. How and where is a dollar created? Dollars are
created by issuing debt � which is done by borrowing for the purpose of spending,
investment in capital and technology development, or speculation � or it is done by
"printing" of it by the monetary authority, the Fed. Dollars abroad are not borrowed into
existence directly, but leveraged in what is a "free banking" system � which is prone to
liquidity problems when it expands more quickly than the supply of dollars from exports
to the US (the creator of our "gold" in this case), because there is no monetary authority
to print dollars outside the US.
Money is thus destined to flow out of the reserve currency issuing country, America.
Aside from giving it away, the only other ways of supplying money abroad is by lending
it and spending it on foreign investments and imports (produced by the investments
abroad).
Imports are destined to flow the other way and to destroy the industrial economy by
competition from imports, so long as dollars are used to settle the most necessary trade
(oil) by political fiat (an agreement between our creditors, us dollar producers, and oil
producers that have our troops sitting around their oil), and there is a need for more
dollars abroad. The need for more dollars abroad is a result of dollar debt incurred in the
past by developing economies; both in their attempts to buy oil in the 70s, and in their
borrowing for capital investment in local and exporting industries in the later 70s and
through 1994.
When dollar exports overcome debt service costs to dollar debtors, the dollar will
collapse as prices of imports grow to match US prices, while import volumes drop and
will start being replaced by local production.
A demonstrative look at recent dollar history:
This is exactly what happened in the course of the development of the dollar reserve
system coming out of WWII. This lasted till 1971, when the then exporters to the US,
namely Europe, finally reached the point where their loan repayments in dollars were
completely supplied by income from their accumulation of American income producing
financial assets, and the US suddenly found itself devoid of new oil, which had to be
imported in growing quantities � thus suddenly supplying more dollars to the global
markets. From that point on, there was no further need for dollars in Europe, and they
just dumped into the markets for real goods those dollars they and oil producers got from
exports destined to the US. Import prices rose to the sky in the US, and "free trade"
became the mantra in order to lower import costs to Americans. Europe and oil lent the
money to emerging markets, and China suddenly started opening its doors to trade.
The oil crisis also brought many of the emerging markets to borrow dollars in order to
supply their upper crust and local industry with oil. Enjoying the rise in dollar prices of
their mainly commodity exports to America, these countries thought that the future
would be just roses and daffodils. Then Volcker (and the markets responding to price
inflation) raised interest rates to the sky and the emerging markets could not refinance
their debts at the old interest rates and could not afford the current rates. The dollar
prices of their products no longer rose, and many prices fell. Faced with lower dollar
revenues and higher debt loads, they wasted no time in lowering their currency values
(by printing up tons of it) till enough real assets were sold to cover debt and export
revenues resumed growth through investment by dollar holders from abroad and
tremendous growth in export volumes to the US.
Japan, seriously damaged its trade balanced by the sudden rise in dollar costs of oil
imports, and made a conscious decision to gain not only enough dollars to cover existing
dollar debt service by interest alone, but to be able to buy a year's worth of oil from
interest income on US treasuries and real assets, which they quickly accumulated.
Beginning in the 80s, highly efficient cars and installations were put in for oil use around
the world, and oil based electricity was replaced by nuclear gas and coal generation.
During the 70s (Japan was still "emerging") and then through the 80s (Japan was now a
"mature" economy), exports from dollar indebted emerging markets grew by leaps and
bounds to 20 times the volumes of 1971, while dollar prices were stable. Through the
90s, while volumes grew at a similar rate (increasingly dominated by Chinese products)
Greenspan's mid-late 90s policy of high "real" interest rates, caused the prices of imports
to the US to drop just after Greenspan's low "real" interest rate policy of the 90-93
period had induced massive borrowing by the Asian "tigers", who could not pay the
dollars off with the exports they sold the US.
They will only be able to resume high speed growth when China (and later India) can no
longer offer cheaper skilled labor or the costs of American distribution and retailing and
export transportation (oil to run the ships and energy costs to build new ships) rises to
the point of choking further export growth by eating the price margin with the US.
Alternatively, they can make a coordinated and concerted effort to lower outstanding
debts and raise reserves in dollars till they no longer have to price their exports off of the
need for dollars for debt and oil. When this point is reached, they will not need any
surplus dollars from the US. The collapse of US energy infrastructure is displacing
production of US basic materials to these same emerging markets, which will increase
their dollar income more than it will increase their production volumes. The 7% drop in
their net debt position is going to be a 10%-12% drop in the next period (assuming
stable oil prices under $40) just because of the replacement of production from US basic
industries.
When non-oil US import prices stop dropping, the signal will have been given that the
colossal debt trap of the past 20 years has been breached and the captured economies
are escaping. Oil prices will then rise in tandem with other import prices going up, till
the US is producing enough of its energy to cap oil prices.
During the 70s and early 80s, the "median American" lost 25% of his "real income".
This round will be worse. With luck, it may fall by 35%-40%, as production of import
replacement capital and energy capital will hopefully grow by the time the process hits bottom.
The posting which caused Sir DaveC to 'get his knickers in a twist' (Brit expression) was sprinkled with Brit. style cynicism -(John Cleese - Monty Python etc.) I guess our American cousins find this straight faced humour hard to understand. It is especially the type of humour we direct at authority, politics etc.
It makes it difficult for them to 'chop off your head', as they are not quite sure whether you are ridiculing, or patronising them. Just keep a straight face on delivery, but let your eyes smile.
FOMC Press Release --- January 31, 2001 --- Rates cut by 50 basis points
The Federal Open Market Committee at its meeting today decided to lower its target for the federal funds rate by 50 basis points to 5-1/2 percent. In a related action, the Board of Governors approved a 50 basis point reduction in the discount rate to 5 percent.
Consumer and business confidence has eroded further, exacerbated by rising energy costs that continue to drain consumer purchasing power and press on business profit margins. Partly as a consequence, retail sales and business spending on capital equipment have weakened appreciably. In response, manufacturing production has been cut back sharply, with new technologies appearing to have accelerated the response of production and demand to potential excesses in the stock of inventories and capital equipment.
Taken together, and with inflation contained, these circumstances have called for a rapid and forceful response of monetary policy. The longer-term advances in technology and accompanying gains in productivity, however, exhibit few signs of abating and these gains, along with the lower interest rates, should support growth of the economy over time.
Nonetheless, the Committee continues to believe that against the background of its long-run goals of price stability and sustainable economic growth and of the information currently available, the risks are weighted mainly toward conditions that may generate economic weakness in the foreseeable future.
In taking the discount rate action, the Federal Reserve Board approved requests submitted by the Boards of Directors of the Federal Reserve Banks of New York, Philadelphia, Cleveland, Atlanta, Chicago, St. Louis, Minneapolis, Dallas and San Francisco.
-------------------------
A note to those mulling over potential stock market investments: I dunno....do you really want to be a partial-owner of corporations in an economic environment where conditions are grim enough that the Fed it was necessary to engage with "a rapid and forceful response of monetary policy"?
There are clear indications emerging that silver will make the break first. Just to show you how you can get caught in a whiplash, I sold some Apex only a few weeks ago at $8 after I watched it fall from $9.75. Today it moved over $10.
Of course, you already knew the cut would be 50 basis points from Monday's post regarding the 28-day repo operation
And this morning in open market operations the Fed added $2.95 billion to the banking system's reserves using overnight RP's. Stop out rates for the various collateral used in this operation were on either side of what time would reveal to be the new target rate for the fed funds market....5-1/2 percent. Imagine that....though Monday's act was more impressive.
beesting (01/31/01; 12:31:59MT - usagold.com msg#: 47026)
Need 2 more "seconds" for ORO's 46961.
*****YES, Sir Beesting, I shall second SIR ORO's 46961!
and wish to congratulate BOTH Sirs Blackblade and Peter Asher for the GREAT EFFORTS to "see into" the Y2K+1
<;-)
NEW YORK, Jan 31 (Reuters) - U.S. 30-year Treasury bonds rose by more than a full point on Wednesday after the U.S. Treasury said its private sector borrowing advisory committee had informally recommended August's sale of T-bonds should be the last.
In its quarterly refunding annoucement, the government said the Bond Market Association committee had informally recommended that growing budget surpluses and debt paydown undermined the need for further bond issuance.
"(The Borrowing Advisory Committee) recommended from out of nowhere that after the August reopening this would be the last bond. The Street was not expecting that," Mark Mahoney, bond strategist at UBS Warburg.
-------------
This line of thought and commentary has been unfolding here in The Tower for the past two weeks and shared for your reading pleasure and consideration at the Round Table. Nice to see it finally out so that we can move on to other areas.
In a nut shell, and without a rehash of the past commentary, you certainly know this to be true: it is easy to pay down past borrowings of big dollars with small dollars.
A short while ago, a contributor to this board posted a link to the writings of Julian Simon, a sharp thinker and steadfast opponent of loose words and looser evidence in the matter of population growth. To quote him: "The Malthusian theory of population growth - accepted until the 1980s by most economists, and by the public accepted still - says one thing. The data say something else entirely." (Follow the link for the full text.)
It is dismaying to see what appears to be tacit support for scaremongering about population growth, especially when the specific problem in this instance (energy shortage) is more likely a function of politics and mismanagement. Granted, dramatic, short-term rises in a local population can have an adverse effect until the community adapts to the new circumstances, but people are nothing if not adaptable. Simon's writings, based on empirical evidence, elaborate on this in great detail. (Please read him! And thank you to the poster who introduced Simon to us.)
If I have wrongly interpreted the meaning implied by Walter Youngquist's letter, forgive my impudence. But if not, then, I humbly suggest, be wary of such prophets of doom.
Beesting Beesting, please allow me to add my name to second your nomination of ORO's 46961 to the Hall.
ORO's work probably deserves its own building, built, of course, with gold and silver bricks. I often worry that ORO may loose interest without enough well-thoughtout feedback from the rest of us. The least we can do is acknowledge his work.
Mr. ORO, with that said may I ask a favor. I'm always looking for good sites to find commodity information from China. I know you study their progress and may be able to recommend sourses of info. Especially cotton and, of course gold and silver.
TIA
Rich
That Apex stock you just sold is the subject of an article in August 7, 2000 issue of Forbes magazine. It's partially backed by George Soros, went public in 1997 and owns land with geologist confirmed rich ore in the Bolivian Andes. When this article was written, the last piece of the puzzle needed was $300 million to fund production costs.
Mining stocks may be warning us of coming events. The guys at GE have been hootin and hollerin about their holdings recently.
Gold--good in hand, good on paper. Secure present wealth and speculate on more!
Rich
Yes, that was the reason I bought it. But when it fell quickly down from $10 to just below $8, I sold out at $8. Fortunately it was only a pilot buy, so didn't lose much.
BUt I always felt silver would lead before gold so that was why I thought I had better own some. We tend to observe better when our money is where our thoughts are - at least
that's the way I find it.
I still back my beliefs I put forward in my competition posting on gold- that any 'serious' movement in gold will be 'capped' until the Euro is strong on its feet. The Euro is the main reason at present for them holding gold, you can bank on that.
To release it now would blow all their efforts, and blow a few other things too. Still, we shall see
Sir Oro's Masterpiece #46961 RE: Sir R Powell's Comments on Appreciation
To all whom these words apply:
As Sir Powell so aptly observed, many who contribute so much time and effort to the betterment of their fellow gold-friends knowledge, may wonder if their enterprise is appreciated, or possibly even read.
With the utmost appreciation and awe for those many who endeavor so tirelessley, I offer my most sincere and humble thanks. Using Sir Oro as example; it has been my pleasure to read his most recent work so many times, in an effort to comprehend, that I'm embarassed to speak of the time alloted.I stand in amazement of those that can *simply* understand, let alone the power of reason it takes to formulate this quality of analysis.
As my tribute to HOF status, let me illustrate my own ORO HOF list, which includes 12-05-99 #20366 12-17-99; #20471 12-17-99 #20467; 12-21-99 #21429;12-21-99 #21433;12-21-99 #21436;12-21-99 #21444; 12-23-99 #21556; 12-29-99 #21792; This is for the month of Dec 99 only - (good one to review with excellent interspertion betwix Sir's Oro and FOA) with my own ORO library filling the annals of fame along with similar archives for the likes of Sir's Aristotle, FOA, Henri, MK, TC - (former alias of our current Randy @ The Tower) and others.
So to shorten this - Thanks to all who come here, such that all of us can rise to your level of understanding!!
By my count that makes at least three "seconds" (including my second of your nomination yesterday) to Beestings nomination of your post to the Hall of Fame! As immortal as GOLD! Well deserved!
I Hope This is the Correct Way to do This!We have had a nomination by beesting 01/30/01 17:42 M.T.
1. A second by Sir Stocks, Lies,and Ticker Tape 01/30/01 20:30M.T.
2. Another second by Sir Gandalf the White 01/31/01 12:49 M.T.
3. A Third and Final Second from Sir R. Powell 01/31/01 13:28 M.T.
FOR.....Induction of Sir ORO's Post # 46961 of 01/30/01 14:43 M.T. into the, now famous,USAGOLD Hall of Fame!!!
Congratulations Again Sir ORO, and to All the posters who contribute so much, and especially USAGOLD, Randy, & Staff who make this site possible!
Format is precisely as desired. And for future occasions, it is also requested that such notes also be tied to an arrow and shot up here to The Tower rooftop (e-mail sitemaster@usagold.com) to ensure that the data is at my fingertips when the moment allows for its handling.
http://www.usagold.com/wgc.htmlClick the link for WGC overview of the events shaping the gold market in the previous week...reprinted here courtesy of WGC.
(In truth, not much of note is mentioned beyond the BoE auction last week.)
Sir:
You have had a respectable career.Why allow some greedy short sellers to put you in a box.That is to say they created a situation where you have to choose between letting crooks and cheats get thier way in the Gold market or allowing them to go broke and leaving you with the problem of stablizing the resultant mess.I hope you decide to let them bear the burdon of thier actions.Don.t think like a Politician and worry about public opinion.Do what is right and things will work out.I seem to recall a few words from Shakespear,"Who steals my purse steals trash,but he who filtches of me my good name,robs me poor indeed".Don't let your career end with this stain of corruption .In the long scheme of things Gold will right itself and if you don't emerge on the side of virtue and truth 50 years of reputation will have been for naught. Don't be short sighted. Remember theres a new administration that values virtue and will back you up.I have no doubt John Ashcroft will do so.The opposition to him is afraid not of his position on Abortion or racism,thats a SMOKE screen.
What they are afraid of is he will be honest and enforce the law ,contrary to what we have had for 8 years.
Times they are a changing
http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin∣dle=ad_frame2_topfin&s=AOnh5LRS2RG9sbGFy Top Financial News
01/31 15:44
Dollar Falls vs Euro
Manufacturing in the Chicago area contracted in January to its lowest level in 18 years, registering an index reading of 40.2 from 45.2 in December. Analysts had expected 43.
``The message here is that the Fed is looking at a very sharp slowdown, and it's in the cards that they'll ease
interest rates further,'' said Kathleen Stephansen, senior economist at Credit Suisse First Boston.
The dollar earlier pared losses on a report that sales of new single-family homes unexpectedly rose in December to the highest level in more than two years. Sales increased 13.4 percent last month following a 7.1 percent drop in November, the Commerce Department said.
``Today's housing sales report is the only light in an otherwise very dark tunnel,'' said Stearns at Bank of Montreal.
Figures yesterday showed U.S. consumer confidence had its largest decline since October 1990, the beginning of the last recession. The index fell to 114.4, compared with the
125 reading forecast in a Bloomberg News survey, and 128.6 last month.
Shrinking Premium
``It's all very negative from a dollar point of view, with a slowdown on the consumption side as well,'' said Karl Halligan, chief trader at CIC Bank New York.
Lower interest rates mean smaller returns on dollar deposits, which may damp demand for the currency. The premium dollar- denominated deposits hold over those in euros shrunk as far as 67.74 basis points today, its narrowest in the two-year life of the regional currency.
Still, the U.S. currency could recover on optimism lower borrowing costs will succeed in stimulating economic growth and boost corporate profits, making stocks and bonds more
appealing to international investors, analysts said.
In that case ``you have some cash flows into the U.S. that can mitigate the effect of lower interest-rate differentials,'' said Stearns at Bank of Montreal. ``The weakness of the dollar will be limited by demand in the
underlying securities markets.''
The dollar rose against the yen, completing a fifth straight month of gains, as Japanese importers took advantage of the U.S. currency's drop to a three-week low to buy it.
Importers
``Whenever you get a movement to 115 (yen per dollar), compared with a trading range of 117 to 120, Japanese importers are going to take advantage and take some profit,'' said Mike Moran, an economist at Standard Chartered Bank in London. It may move to 120 yen per dollar in coming weeks, he said.
Japan's imports rose 4 percent in December from November to 3.8 trillion yen ($32.7 billion), increasing importers' demand for dollars to buy U.S. goods.
The yen's decline was accelerated by a report showing Japanese workers' wages, adjusted for inflation, fell 0.2 percent in December from a year earlier, after rising a revised 1.5 percent in November.
In other trading, the dollar was little changed against the British pound at $1.4641 per pound from $1.4625. It fell against the Swiss franc to 1.6355 francs from 1.6466, and against the Canadian dollar to $1.4993 from C$1.5038.
Back in the pre-Y2K days, we reported from The Tower that the Federal Reserve had moved to expand the list of eligible collateral against risks of a possible liquidity crisis from an unpredictably large degree of precautionary withdrawals by banking depositors. It was through this action that agencies and mortgage-backed securities became a regular addition to the use of Treasuries in the Fed's open market operations.
Then, shortly into 2000 after the century date rollover proved to be a non-event, we promptly reported the curious fact that the Fed opted to extend for a year the sunset clause originally established when they expanded this list of acceptable collateral.
And now that this first year-long extension of time is drawing to a close, we now see the Fed take action to once again extend for another year the use of this "crap collateral" as we playfully called it long ago. Making it official, a NY Fed spokesperson announced, "The current provisions governing collateral for repurchase agreements have been extended for a year. The Fed voted to approve a temporary extension through the first scheduled meeting of 2002." How many years must pass before this annual ad hoc policy becomes clearly seen as a permanent evolutionary feature?
In the words of Reuters, the reason for the extended use of the alternative collateral: "mounting budget surpluses and a government buyback program of U.S. Treasuries made their supply more scarce."
Note to Peter Asher:
A few days ago you picked up on my offering of dialogue between Uncle Sam and the waiter ("We shall have the hyperinflation." "Excellent choice, sir; the only item on the menu.") though you chose to alter it with a rebuff from the waiter that the ingredients were not available.
Thank you for providing me with this opportunity to clarify...and to follow my own advice in this regard. As I have stated before, for best clarity among people with differing understandings of inflation and deflation, discussions should specify whether the user is referring to money supply (the preferable use) or to prices, and also to the size of the petri dish. As I have said many times before, the view from The Tower is one of a deflation in dollars in the global scale as the use is replaced by euros and alternatives. However, as the dollar falls out of favor in international use, we see ample ingredients for domestic (within America's borders) hyperinflation of supply and prices as the Fed moves to liquidate the grinding banking sector from within, or even as the deflating global supply is sent packing...all into its original "tiny" home. Goodness!
"We shall have the hyperinflation." (Domestically...HERE...in the U.S.)
You see, the euro model is the North Star toward which our legacy dollar-system now lurches to realign, else be forever adrift like the odd man out in an overloaded life raft. A painful transition lies ahead, to be sure, but a firm and grounded understanding of gold will bring a person shining through the coming paper storm.
http://www.usagold.com/onlinestore/special.htmlOn the cost for packaging, insurance and shipping, is working out an arrangement that *may* (or may not) provide an opportunity for economizing in that regard. But still, with the shipment of gold, as you well know when you sign for the arriving box, there is more to to the whole process than the simple licking of an envelope flap and a stamp. The order must be filled with the retreival of the coins from safe inventory under tight security in one of several bank vaults where Centennial maintains bullion accounts for business both here and Europe. As you can imagine, that process itself is somewhat more involved than sending a courier to the supply closet for some extra paper and pencils.
Then, the metal is boxed and wrapped sufficiently well with security tape to withstand a near-miss from an errant hand grenade. And finally, an insurance policy ensures no one will suffer a loss if the hand-to-hand registered postal service breaks down between Centennial's point of delivery and your point of personal receipt. When you place an order for gold, you can take comfort knowing that shipping fee initiates a chain of activities and events that, to my mind at least, seems a bargain were it twice the price.
Unfortunately, (or fortunately, depending on your circumstance) the shipping fee is the same for small orders and large orders alike...because the effort by the various professionals involved is much the same whether there order calls for 1 coin or 10,000. (Well, in truth, on a 10,000 coin order MK is prone to "buy the stamp" himself, in a manner of speaking.) So, the lesson is nobody should be shy about calling with some of the orders you are contemplating and try to sweet talk a deal. And don't be afraid to ask for coins that you do not see on the menu....gold marks, argentinos, francs, lira, pesos. It just might bring a smile to your face.
"Are we suggesting that investors should bet against the government's
ability to contain the energy crisis in California? Yeah. Are we
suggesting that investors should bet against the government's ability to
hold the stock market economy together? Absolutely! Especially since
they (the government) are the cause of both problems. Allow us to try
and make the connection between all of that, and what is happening in
California at the moment.
"'We're doing our level best, there are forces in play over
which we don't have control now, the form of deregulation
that California passed five years ago,' Governor Gray Davis.
"Oh brother. Those (regulatory forces) are the only forces you have
control of pal. Forgive us, but it is fun picking on the politicians,
because they are a non-stop source of irony and credulity.
"There is no point in blaming deregulation when the source of the
problem is a quadrupling of natural gas prices over 12 months. What is
the source of that imbalance? An overheated economy? But, I thought
we were in recession. Suddenly we got a shortage of gas, hmmm. Sure
there is a real estate boom in California, which has been building
natural gas utilities into about three quarters of the newly built homes
on the west coast. What has fueled the boom though? Productivity and
technology - not likely.
"Certainly, that is why the money went there, but who supplied the
money and how much of it did they supply? It's easy, really: the Fed,
the US banking / financial system, and the various GSE's (Government
Sponsored Enterprises)� truck loads� that's how much. In fact, we are
witnessing the greatest monetary inflation history has ever seen!
"There "is" a relationship between gas prices and oil prices. It is
conceivable that if oil prices did not rise to $35, but rather stayed at
$10, there would be a much smaller impact on the gas markets. By the
way, wasn't the economy stronger from late 1999 to the first quarter of
2000 than it is today? Yup. Yet gas prices were 1/3 of what they are
now. Yes, it has a lot to do with oil prices, but what caused oil prices to
rise so sharply in the first place? If you cannot answer that by now,
please reread the prior paragraph."
Shifty: Well at least someone got a guffaw out of it.
Barnacle Bill: Do I trust Comex stats? Well I was a little sceptical but see the next message to Black Blade.
Black Blade: Comex warehouse stocks in palladium a laughable 110 oz. In platinum an almost equally laughable 620 oz. Guess platinum defaults next. Looks like the numbers are honest just made hard to find.
Excuse me OMB ! In 6 years there won't be any debt left to buy back? All that means is the Gumment will have monitized all the debt!Am I wrong?All they did was LAUNDER IT through the tax system.If interest rates keep falling and you have monitized all the debt,where will the Dollar be?
Dear wife ,forget that purchase of toilet paper you were planning!not needed....It appears paper will be in plentiful supply.
"Yet, he is remembered for gaming a system, a system that never should
have been implemented. Columnist Stephen Chapman declared that
the pardon was wrong because Rich has not "paid his debt to society." What
debt? For that matter, why have politicians not "paid their debt" for
imposing these ridiculous price controls in the first place? Those politicians
lowered our standards of living. Marc Rich helped raise them. Whatever
"debt" he might have owed us, he repaid it long ago."
"Trillions are missing from federal
agencies. That's right, gone. Poof! As
in, "Nowhere to be found." People
familiar with government accounts
have charged off the record that in
1996 a concerted and intentional
effort began with the support of the
Office of Management and Budget
and Treasury to strip agencies of
honest officials and internal financial
controls.
"Allegedly, the reports of missing
money at the various agencies started
rising exponentially in 1998 and 1999,
but the actual problem began with Al
Gore's "Reinventing Government"
initiative. It was in the Clinton
administration's first term that
inspector generals and their staffs
(each federal agency is assigned an
inspector general who audits and
monitors each agency's accounts and
activities) were instructed to begin
collaborating with their agencies -- a
most peculiar instruction. As one
frustrated inspector general
remarked, 'How can I collaborate
with the very people I am meant to
police?'"
Pandagold:
"The posting which caused Sir DaveC to 'get his knickers in a twist' (Brit expression) was sprinkled with Brit. style cynicism -(John Cleese - Monty Python etc.) I guess our American cousins find this straight faced humour hard to understand. It is especially the type of humour we direct at authority, politics etc. "
"There should be no need to explain to those with a wide open mind,"
"It must be that blood rushes to your eyes the moment you see Pandagold"
"Where you frightened by a panda as a child?"
Are these comments really necessary?
Is this how "true knights behave"?
And there are many more that show your arrogance.
I understand British humor very well thank you. Again you have this incredible arrogance in you tone. You are the only one who can understand what you posts. You are never wrong, we just read your posts wrong. There are at least a half dozen examples in the last week where you state someone must have misread your post. "Go back and read it again" is your common response.
Get over yourself.
rc, you said
"You do not understand what Pandagold is talking about. And he just can't go much farther to explain himself. But trust me. He is amongst the few people in the know."
I say you are insulting my inteligence as you do not know me from Adam.
You are not "disagreeing" with me. You are making a blatant statement about me and my understanding which you can have no knowledge about.
As for Pandagold being one of the "few people in the know" you give her way toooo much credit.
From what I have read here, she has not said anything which is not already known by many people I talk with daily on the internet.
Except for the Clinton deserves pity" post which was sheer lunacy.
I live in Portland, OR. I think there are going to be more problems than you expect and from reading your posts, I wouldn't call you an optimist!
First, as you been reading California has huge outstanding energy bills that are going unpaid. Guess who paying them. A lot of people in Oregon. First, becauswe we have a lot of hydro generated power we shouldn't be having energy problems even through we had a dry Winter. Even with low rainfall there is such excess capitcity usually we can met our needs. However, most of the power we generate is being send Southward. California is pulling power from everywhere and not paying for. Which brings up another sore point. We are paying for it!. Our energy cost has been two to four times higher. Pacific Gas and Edison while bound to price controls in California also serves the NW and they are paying on the losses to us.
As to things getting "Ugly" It already has. Remember people in Oregon don't care for them Californians. Believe me, Their energy crisis hasn't help.
One of the reminders as to how ugly it could get was on New Year's day we had looting and rioting. I moved to Portland to get away from that. (I didn't move from California by the way. Spent a week there and hated it.)
So I think it is going to be more than ugly. Think of the old Chinese Curse: MAy you live in Interesting times!
Black Blade (1/31/2001; 2:03:28MT - usagold.com msg#: 47003)
Cheap Energy a Thing of the Past!
I just finished reading a report on the northwest energy projections. There are serious concerns about the ability to
produce power in the northwest due to low water levels and the lack of precipitation this winter. The report sums it
up with a statement from Dick Watson of the Northwest Power Planning Council : "It's going to be one ugly
summer." It appears as if the Kalifornian economy is toast after all. Ratepayers from neighboring states are quite
irate with the state of Kalifornia. In Arizona, retirees were told to expect 300% rate increases soon. There are some
protests being planned with their anger focused on Kalifornia. In another report, I read that there are now problems
with "Deep-Water" and "Ultradeep-Water" drilling projects as the ambitions of big oil companies are out distancing
the technology. It seems as if all but one project came in on time, they average 35% over budget, large scale shut-off
valves not working at great depths and there are a lot of other equipment failures. It looks as if there will be no more
return to cheap oil and cheap energy. There are going to be some very serious problems for the economy going
forward.
Permission to reprint is hereby granted where the USAGOLD name is cited along with our web address, mailing address and phone number. For electronic reproductions, citing the post heading and the http://www.usagold.com/cpmforum/ website address as the source is sufficient.
The USAGOLD logo and stylized gold coin pile are trademarks of Michael J. Kosares.
==========================================
As we enter this New Millenium, 2001 holds alot of promise. Let's hope the
next 1000 years will be better than the last 1000 years. Afterall, it couldn't
be much worse, could it.?.
Predictions, accurate ones, are not my forte'. As most of you know. But at least
allow me to put forth my WishList. I cannot see into the future as far as most
of you can. So I'll limit the scope to only the next four years.
[Energy]
Top of my list. Everyone's list. Continued shortage of refinery capacities
and increased wastefull consumption will lead to extreme conservation measures
enacted (once again) by government. Remember the 55 MPH speed limit.?. It'll
be back. Remember Nukes.?. They're gunna be back in vogue. Remember Clean Air
Standards.?. Out. Like the lights of Kalifornia.
New energy sources will become economically feasible. Look for breakthroughs
in Solar grids. Look for Shale-to-Oil. Remember coal.?. Better look it up.
But transcending all of those, will be new (small) (in-home) Fuel Cells. Using
water as fuel. Yes, water. And Platinum. And Silver. It's so easy, to electrolyze
Hydrogen and Oxygen from water. Burn it to create heat; make steam; turn your
turbine; and use a tiny fraction of the electricity produced to feedback into
the electrolyzer. Even smaller Fuel Cells will be adapted to autos and trucks.
It's common sense, not perpetual motion. Trust me.
[Stock Markets]
After DOW and NASDAQ (et al) crash to 500 and 50 (respectively) several new rules
will be enacted to stabilize such markets. The biggest will be the banning of any
and all "short" sales. If you ain't got it, you cannot sell it. Nor manipulate it.
[Precious Metal Shares]
Gold/Silver/Platinum/Palladium producers (mines) will see their shares vastly
outperform any of the other stock market shares. (see below -- $USTSC & $USTGC).
Meaning, ones that currently have *real* production and facilities. And ones not
hamstrung with faulty hedging programs of the past.
[Other Paper Markets]
Hapless "investors" in the Futures Markets (Gold/Silver/Platinum/Palladium) having
seen all their Metal Delivery Contracts evaporate into UnDeliverable status, will
welcome the new rules to be enacted: No more "short" sales, except from bonafide
(mining companies) producers, and then, not for more than a proven-capability of
a single year's forward production. Sellers will require a government license. And
buyers too.!. (see below) Only bonafide producers and fabricators will be allowed
to participate in PM "Futures". These will even become somewhat pointless.
[Derivitives]
Commodity and Stock Options, Puts, Calls, Index Funds, and all forms of Derivitives
will be banned. As nothing more than proxies for gambling. Market Stability becomes
the paramount concern of the regulators. These have not and never will, contribute
to authentic market activity. You wanna gamble.?. Go to Vegas. Or your nearest
Native American Casino. Fun is where you find it. You won't find it in the Markets.
[US Dollar]
Defined as "Federal Reserve Notes" (FRNs). These will "decline" until they reach their
ultimate "strength": Equal to one of the new USTreasury-issued $USTSC or $USTGC forms.
(see below).
[Federal Reserve Bank(s)]
FRB Chairman Alan Greenspan will be seen as foot-dragging or powerless to control
a spiraling (downward) USA economic system. The New Administration will phase out
the FRB concept. And replace it with the Constitutionally mandated US Treasury as
the ultimate and absoloute source of (Congressionally Decreed) (NEW) USA currency.
(see below). The FRB and Branches will become "nationalized" and function as local
Branches of the US Treasury. No-more an automonous privately held unaccountable
nightmare of credit and manipulation. Greenspan is out. Secretary of Treasury is
the new Currency/Credit Czar. Accountable to the President. Congress. And the People.
[$USTSC & $USTGC]
USTreasury Silver Certificates and USTreasury Gold Certificates will be issued to
phase out FRNs. Issued directly by the US Treasury. Backed by the Full Faith and
Credit of the US Government. And backed by whatever Silver and Gold remains in
the US & FRB-NY vaults. Plus (mandated) ALL future Silver and Gold production that
comes from the (USA) mines. US Treasury is the (mandated) only buyer of it, with
few exceptions, by government permit, for industrial fabricators.
$USTSC circulates side by side with US Silver Eagles, at face value.
(1 $USTSC= 1oz Silver)
$USTGC circulates side by side with US Gold Eagles, at face value.
(1 $USTGC = 1oz Gold)
FRNs will decline in quantity to become interexchangeable, until withdrawn completely.
That means, they will become STRONGER in purchasing power, as it takes only 50 of
them to purchase a new $USTGC or 1oz Gold Eagle. Ditto in the case of $USTSC, the old
FRNs will become stronger, whereupon only one is required to purchase one $USTSC or
an oz of Silver. But initially, FRNs will remain as Legal Tender for purposes of
monetizing preexisting US Dollar-denominated Debt(s). Public and Private. During
that period, they remain a "weaker" fiat currency, needing 500 to purchase 1oz Gold
or 50 to purchase 1 oz Silver. It sounds confusing, but isn't. Trust me.
[EURO]
The European Common Union's EURO will be forced to undergo a similar transformation
to remain competive for world trade, and to have local credibility with populace.
It will emerge in forms similarly backed by Silver and Gold. A similar phase out
process will occur. EURO SC and EURO GC will become identical in valuation to the
$USTSC and $USTGC coin and currencies. All or any of those will be (eventually)
accepted at par, as Legal Tender, in the newly stabilized world trade environment
as well as newly invigorated local economies.
[Other Currencies]
Silver and Gold backed equivilent currencies will become a necessity for all other
nations. And well to their advantage to do so. Hey.!. You wanna "trade" with us.?.
Then get-real with your coins and currencies. Fiat is Finished.
[New Common Markets]
Latin America (South, Central, and Mexico) will form a Latin America Common Market.
Call it the LACM. Their Silver based common-valued coin and currencies will provide
the stability for growth and integrity required of them to become vibrant and strong.
Asian Countries will form similar Common Markets. And institutionalize similar
Silver and Gold backed international standard coins and currencies.
Mid-Eastern countries, OPEC etc, will be quick to join in favoring standardized
Silver and Gold based coin and currencies. They will accept nothing else for their
coveted oil. They will not want to be left behind or cheated with fiat any longer.
African countries will find it easy to transition to precious metal based coin
and currencies. Of the international standard. Afterall, they will be the major
providers of metals to many non-resource abundant countries. (Europe etc)
Russia and the old remnants of the USSR will not wish to remain outside the world
circle of PM based coin and currency. Rich in PM's, they need only institute rigid
safeguards to insure their mine production(s) actually reach their Government(s)
Treasuries, for the subsequent and required minting and currency backing. President
Putin of Russia, will be strong enough and savvy enough to ramrod this into being,
and get tough on the corruption that currenty saps that region's great PM wealth.
Canada, of course, being rich in Precious Metals, will welcome similar revisions
to their coin and currency. Once again they will become proud of their Maple Leaf
coins of Silver and Gold. And Loonies will no longer be looney.
Australia, also rich in PM's, will lead the way to a rebuilt "Common Union" with
Canada, and the United Kingdom. This will be very popular with their citizens,
and as an act of comradarie, assit England (UK) to become strong and prosperous
once again. A new "Empire", based upon Common Markets, and commonized PM money.
[POG / POS]
The "Price of Gold" or "Price of Silver" will become a thing of the past. Meaningless
terminology. The "price" of Gold, will be, simply, an ounce of Gold, or a standardized
Gold Certificate issued by any number of cooperating countries. And too, the "price"
of Silver is simply, one ounce of Silver, or 1/50th ounce of Gold. And yes, the
"price" of Gold will also be defined as simply fifty ounces of Silver. See how easy.!.
In terms of the old (to be phased out) FRNs (and even old EUROs) you will see a
transitionary period where these will be "deflated" to an equilibrium valuation.
Then withdrwan from circulation (see above). So, initially, during the transition
period, people may talk in terms of Gold is at $500/oz in FRNs, or Silver is $50/oz
in FRNs. Knowing this, you will, of course, not get caught holding FRNs for very
much longer. Will you.?.
[Real Estate]
Housing, and the Property(s) upon which it's built, as well as pristine undeveloped
property will, as always, retain it's intrinsic value. And continue to appreciate
as it inevitable becomes more scarce. Never underestimate the "value" of prime
real estate, as a preserver of wealth. Beware of speculation bubbles that have, in
the past, overvalued or inflated it unrealistically. Under the new coin and currency
standards, nothing changes any of that.
[Credit and Banking]
In previous eras, when money was linked solidly to precious metals, Banks were able
to thrive and modestly increase the money supply. Via sensible credit and lending
practices. Strictly controlled "reserve" requirements will be instituted by the
(US)(and other government's) Treasury(s). Gold and Silver Certificate Banking, to
include checking and savings accounts, will be as safe as FDIC-insured nowadays.
Credit, in those days was generally "secured" loans. We will see a return to that
concept, with little if any "unsecured" flippant credit. A vibrant economy does
not need alot of unsecured credit. It's dangerous and counter productive.
Growth in the Money Supply comes from two sources in the future:
(1) Mine Production and (2) Sensibly controlled Lending by Banks.
[Consumer Prices & Inflation]
These will stabilize within reasonable ranges, priced in the new coins/currencies.
There will be a transitionary period of helter-skelter "inflation" in terms of the
old (to be phased out) FRNs. But generally, nothing to be alarmed about. No hyper-
inflation, and no $30,000/oz Gold is on the horizon. It ain't gunna happen. The
government(s) will step in way before that could ever materialize. Using all
of the above to thwart such unthinkable chaos. Governments are dumb, but they are
not stupid. And, as always, they, and only they, determine what you call "money".
Just deal with it. Be prepared personally. And enjoy the New Millenium.!.
Cordially,
ThaiGold@OperaMail.Com
View Yesterday's Discussion.