"As you can see, I have no confidence in the government or in man for that matter. "

Maybe I just feel like sticking my finger in the electric socket, but while we're enjoying the afterglow of all the appreciation for you, and popping Modelos all around, I'll ask if you've really reconciled all of your beliefs.

EarthFirst or Sierra Clubs aside, do you really think that there is a "Should" attached to Americans wanting "cheap energy"? And if those "free markets" can bring it to 'em, by gum, let's make sure we drill anyplace XOM wants.

I'm as glad for cities as you are, and I'm glad OTHER people like 'em, too. If everybody spread out evenly, we'd feel a lot more crowded on this little rock, you and I. They stay where they are, fine with me. But more and more, they spread out. The open places are filling in.

If you had to pick a number, how many humans do YOU think the breeding should have stopped at?

My number is about 1 billion. In other words, the other 5/6 should never have happened (which is kind of a hard topic to bring up in a conversation among 6 people "Who the %@$! do you think YOU are buddy?!? Are you saying that you're the only one who should be here?") Sheesh.

But given they are, and we are, how are we going to figure the carrying capacity -- LONG-TERM -- of this place? No limits? If so, then when? Do all 6 billion get to run rampant like we've been doing here? Just another animal doing that die-off thing.

Anyway, I don't want to get too far into this. You've probably done more as an individual to LIVE a conservationist ethic than most who preach it. And I'll bet you're speaking from more than a little experience in the resources field. (So you feel you can "talk on the wild side" a little more. (?) Plus that feeling of "Don't fence me in.") But I don't know that that cinches the case.

It took me a lot of years to get out of breathing everyone else's exhaust fumes. Got my kid growing up without 'em too now. (Got my own trees I can go hug, too, when I'm feelin' lonely -- {smile} )

I figure, if I'm not sure which way the argument shakes out, then let's make sure we don't fritz up the place before we are sure, rather than let Dick Cheney and Ken Lay rea$$ure us everything'$ all right, so let them go ahead, plea$e.

Do you really want every teenager who feels like tooling around in his dad's SUV every Friday and Saturday night to have 99-cent gas from now until it runs out, and whatever aftereffects of getting it are with us to stay? Don't make "environmental" a curse word; we live in it.

Talk more about who and how you would trust to go after those scarce resources; and when. My answer is: not these guys, in Washington or in Houston, and not now. Like you, I just "have no confidence".

http://www.bearforum.com/cgi-bin/bbs.pl?read=222395From GATA, here's the first account I've seen of the blipped-out exchange, where Paul first compared the Fed's operations to Enron's. (OK, now I see Chris P posted the yahoo groups link Wednesday night -- I'll leave this up, I missed it before, others may have too...)

http://www.usagold.com/cpmforum/archives/2720022/default.htmlOops! Randy got the whole Paul/Greenspan exchange transcript in -- I think Weds. just flew right by me! Busy times -- and now, I'll take Black Blade's cogent advice: "And I might add - begin sleeping well at night. " Amen.

http://www.suntimes.com/output/novak/cst-edt-novak28.htmlOK, so I stayed up. This is the first mention I've seen of those verboten words in the main press.

"''Whenever you have a liquidity crisis, the last thing bankers are going to do is warn about a liquidity crisis,'' a corporate financial expert (who asked not to be identified) told me. ''They worry it might set off a panic.'' As an example, he cited the lack of warnings three weeks before President Franklin D. Roosevelt was forced to close the nation's banks."

And when you're sitting in that theatre, hedonically enjoying all the entertaining enhancements Hollywood can supply, remember not to use that incendiary rhetoric.

Of course, someone finally has to call fire "fire". The bearer of bad news gets is head chopped; the authorities have done their jobs (Not!), and the arsonists who set the theatre on fire go on to write their memoirs and take $25,000 speaking engagements.

Nature has a way of culling the herd as it were. Occasionally some disease runs rampant through civilizations to knock off a few to thin out the population. There were some excellent examples in the dark ages such as when the bubonic plague swept through the populated areas. I can almost hear the clatter from the wagons and the cries from the streets "Bring out your dead". Small pox also did a number on man. Perhaps another plague such as Ebola or some variant could sweep through the civilized world. At one time I had thought that perhaps HIV would be the culprit.

Of course man tends to kill each other in meaningless wars. Why? I don't know, but I think that man kills other men because he likes it. Then again the nations leaders, their relatives and friends aren't the ones going off to battle.

I am reminded of the scene in the movie "The Matrix" where the agent is talking to the restrained Morpheus and he says: "I realized that you (humans) are not even mammals. You use up the resources in one area and when those resources are used up you spread to another area. There's another organism like that. You know what that is? A virus!"

Nature has a way of cleansing itself and the Earth is quite resilient. Whether the "virus" is contained as natural selection weeds out the weak through disease, war or famine I don't think that it matters. For all of mans great feats of technology and advancements he sure pulls some really stupid stunts. The list of examples from history is almost endless. Yeah, I guess that I really don't have much confidence in my fellow man. Like you I am sure glad that most people like cities. I only hope that they stay there.

Kind of funny isn't it? The city dwellers flush there sewage into the worlds oceans, they dump their garbage out in the country, then they have the gall to deride those of us who explore for, develop, and provide the resources for them to live the comfortable lives that they now enjoy as earth rapers and defilers of the environment. I find that curious.

Speaking of Negra Modelo, I think I'll have another. Cheers!

- Black Blade

http://biz.yahoo.com/rb/020301/business_energy_opec_dc_2.html
LONDON (Reuters) - OPEC Secretary-General Ali Rodriguez said on Friday he saw the cartel maintaining stringent oil production curbs for the rest of this year to lift prices back to OPEC's $22-$28 per barrel target band. In an interview with Reuters, Rodriguez said he was confident that rival oil power Russia would prolong its crude oil export cut into the second quarter, to match the time scale of OPEC's reduction.

Black Blade: I am surprised that the Russians haven't cheated on their quotas more than they have. The higher oil prices must be weighing heavy on the US economy and be holding down any perceived economic recovery.

http://www.usagold.com/onlinestore/special.html

U.S. Liberty $10 Eagle

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http://m1.mny.co.za/twta.nsf/Current/C2256AE000238D15C2256B6E005496FB?OpenDocument
Snippit:

Gregor Krall, his counterpart at NIB Securities, isn't as enthusiastic about gold's immediate prospects and says it "still may battle on the upside for the moment" although he reckons the latest surge in the platinum price could be supportive of gold's cause. Krall says he would remain a buyer of gold at around $290 and thinks there is potential for a move towards the $330 to $335 mark in the next two to three months.

"It's hard to quantify when," says Krall, "it could be in a few weeks, could be in a few months." As for shorter-term levels, Krall sees support at $294 as the dollar gold graph had formed a "small double bottom" at that point. On the upside Krall pinpoints $301.50 and then $307.50 as key resistance levels.


Black Blade: "Interesting"

IMO, explore, drill, and cap ANWR. An in-ground Strategic Reserve that's ready to pump on short notice. Find other domestic reserves - and place an "X" on the map. Oil is cheap, bottled water costs more. OPEC has no choice but to sell it, unless sand suddenly finds a market.

At roughly 600,000(?) barrels a day from ANWR it would be little more than a drop in our daily bucket of usage. I think it would be better used as an, albeit small, trump card in our dealings with OPEC. It also leaves some for our children and grandchildren, when it's value will almost certainly be much higher.

Pump OPEC dry of cheap oil first, save ours for us and our friends in the future.

BB: wasn't that reference to "cockroaches" in The Matrix? Could be wrong, only saw it once.

Actually the ANWR would be more economic as we already have the pipeline and means to draw of the reserve. It is estimated to be roughly equal to Prudhoe Bay's reserves. The Alaskans favor the project and they resent the lower 48 interference in what they consider an Alaskan resource (not to mention the royalty checks). It may be drilled and extracted coincident with North Slope NG and the proposed NG pipeline. There are enough votes to pass drilling in ANWR if it ever reaches the Senate for a vote.

I am sure it was "virus" as I have the tape and just watched it last week. It is quite a odd thought provoking film. Cheers!

- Black Blade

http://www.mises.org/fullstory.asp?control=901It is time for Argentines to cash in their experience with government power, government law, government regulation, government money, and government care. They attended a hard school and paid high tuition. It taught all who cared to learn that, after every conceivable political device has been tried and found wanting, there remains freedom. When political minds are unable to concoct yet another law or regulation, another scheme or another care, there always is freedom. It is the very last hope, short of despair.


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

http://money.cnn.com/2002/03/01/companies/enron_andersen/
Agency urges plaintiffs to accept $750M settlement, but attorneys balk.

Snippit:

NEW YORK (CNN/Money) - The Securities and Exchange Commission is urging plaintiffs suing accountant Arthur Andersen for its role in Enron's collapse to accept a settlement totaling $750 million from the Big Five firm, according to a published report Friday.

Black Blade: Arthur Andersen has been fired by some clients so far. I would expect that many more corporations will cut their ties. I also expect many more lawsuits. They will likely face lawsuits from angry Global Crossing investors next with many more to follow.

http://member.usagold.com/commentaryreview.html

Myths & Realities

Myth: Central banks are massive sellers of gold and that's why the price has been held in check.

Reality: In 1950 central bank gold holdings were 33,000 tonnes. By 2000, the central banks housed 30,000 tonnes. Through all the announcements, the threat of sales and actual sales -- the London Gold Pool of the 1960s, the U.S. Treasury and International Monetary Fund sales of the 1970s, the European central bank selling of the 1980s, and the Australian, Argentinean, Belgian, Dutch, British and Swiss sales of the 1990s and 2000s -- less than 10% of the gold sold actually left the central bank network. From this one might conclude that official sector liquidations have been off-set for the most part by official sector acquisitions. Central bank gold selling has been a sound and fury signifying nothing.

Chart Courtesy of the World Gold Council / London

One of my favorite topics of discussion. I believe there are way too many humans on this planet. Plagues and diseases that would have otherwise killed millions of humans in recent years have been hindered by the presence of our medical professionals. People are forcing children to have sex with them for food rations in starving countries. Why do they do it? Who knows. What allows them to do it? Because there are so many people that they can't feed themselves, so they'll do anything for survival. North America is obviously less densly populated than most other countries in the world, and we might even have the capacity to be self supporting. Native tribes of North America would battle over fertile grounds and good hunting areas, and once an area was depleted of most of these things they would move to another area and battle for that. I don't think we've really changed all that much, our tribes are much bigger, and we've got better weapons, and we have bigger wars. If this instinct is buried in our self conscious, I think we're in for a big ass war in the near future. If you lived in an arid country and your people were starving and dying, wouldn't you go to war for a fertile land so your people could survive? What if you thought you could somehow overpower North America? I know it sounds riddiculous, but it's not impossible.

Mother nature has come up with some fantastic ways of challenging humans in order to flush the system. I don't go to doctors when I'm really hurting with what might be the latest cold/flu, whatever. I like to allow my body to attempt a recovery, if one day I get some virus and I don't make it simply because I didn't go to the doctor, then I've given back to mother nature all of the wonderful things she's provided for me.

Warped RobotGuy.

There is one thing in the back of my mind that always haunts me. I have been a contributor to the 'modern world'. I drive a vehicle, I work in the automation industry, I consume commercial goods and energy and I play my part in the ever expanding human snowball. My dream? To save enough money to buy the piece of land that will allow me to be 100% self supporting.

http://www.federalreserve.gov/boarddocs/press/boardacts/2002/20020221/attachment.pdfWhat do you make of the above link?

http://www.investavenue.com/article.html?ID=4202The BoJ talks of systemic collapse By Victoria Marklew from Northern Trust Company:

---We've tended to criticize BoJ Governor Hayami in the past for a lack of realism and for spending too much time chastising the government and not enough focusing on the economy's woes. But yesterday, he stepped up to the plate in quite a remarkable way - not, of course, in actually doing anything but in terms of what he said.

Policy-wise, the BoJ symbolically eased again, raising its monthly purchases of Japanese government bonds from �800 billion to �1 trillion. However, of more interest was the statement released after the bank's policy-setting meeting this morning, which contained six main paragraphs. The first noted that extremely accommodative conditions are being maintained in the financial markets, and that the year-on-year growth rate of the monetary base has reached nearly 30%. The second pointed out that, with the fiscal year end approaching, liquidity demand may increase and so it is crucial "to secure financial market stability." The third paragraph outlines a promise to provide liquidity to meet a surge in demand irrespective of the current account balance target of �10-15 trillion; the increase in JGB purchases; a loosening of the conditions under which banks can use the Lombard-type lending facility for the period March 1-April 15; and finally, a further broadening of the range of eligible collateral for lending.

It is the first measure that is crucial - the bank is promising to do what it can to ensure no March 31 liquidity crisis. Then comes paragraph four: "To realize the full permeation of the effects of strong monetary easing, it is essential to strengthen the financial system and ensure its stability by making a swift move to resolve the non-performing loan problem. It is also vital to make progress in structural reform." Paragraph five states that, to exit from deflation, "it is indispensable to revitalize economic activity and to bring the economy back to a sustainable growth path through decisive steps including those described in paragraph four." The final paragraph says the BoJ will "continue its utmost efforts as a central bank" by providing liquidity and by "preventing systemic risk from materializing as the lender of last resort."

In his subsequent press briefing, Hayami said "If we speed up the disposal of bad loans, banks' capital would inevitably decrease. And it's a matter of who comes up with the funds � I think public funds should be injected promptly." The earlier the better, he said, possibly by March 31.

Let's make this clear: The governor of the central bank of the world's second largest economy, and one that is home to some of the world's (theoretically) largest financial institutions, has just said that he is having to act to avert a systemic crisis, and has called on the government to recapitalize the financial system as fast as possible. The monetary base is expanding rapidly, and the M1 money supply measure has been increasing sharply. Nominal GDP is contracting while real interest rates remain positive. The cost of maintaining the huge public sector debt is rocketing.

For the past decade, successive Japanese governments have been able to duck responsibility for straightening out the economy's problems because the nation is so rich - huge current account surpluses and foreign exchange reserves, and the fact that most government debt is internally held, make Japan the world's largest net creditor. But read the previous paragraph again. At some point, the financial sector and/or government bond market and/or currency is going to collapse. It's just a question of which comes first, and how soon. ----

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"For those who want to buy [gold], the temptations are greater and the justification is stronger. Those who have listened to the naysayers [on gold] have probably missed the recent rally [up 19% from April 2001 lows]. So what should they all do now? Buy on the dips, betting that gold can bounce back over $300 and go a little further." Jonathan Fuerbringer, The New York Times (2/24/02)

"We expect that this [gold] rally may prove to be less of a temporary blip and more of a trend.'' Howard Patten, BarclaysCapital

Gold Market Brief (3/1/02). . . . . . Gold continued its languid drift in a southerly direction biding time in advance of Tuesday's Bank of England sale -- the last in the series. Reuters reports "One large commission house bought three 300 lot chunks early on, according to sources, only to be met by selling from an investment bank." Traders put support at the $295.50 level and resistance at $297.00. Will the market celebrate the end of the BOE gold market "occupation" with a major rally? I'm sure that Eddie George and the Blair government will be happy to see the sales come to an end given the amount of heat they've taken since the first gold left for stronger hands three years ago. At the same time, the British people are unlikely to forget a program that lost the British government a great deal of money and accomplished none of the goals stated by Exchequer and central bank officials throughout the process -- chief among them turning 300-tonnes of gold into paper currencies from which they were supposed to receive a return. Over the past year gold is up in the neighborhood of 20%, the euro has cratered and the dollar approximates a return in the 2% range. So much for central bank prescience when it comes to money matters. As we all know there were other reasons for the sale -- unstated reasons -- probably having to do with British commercial banks in trouble on their gold loans and the BOE was merely fulfilling its legacy as a lender of last resort (only this time it cost them in more than just paper and printing costs.) We stated that as the real reason for the sales the day the auctions were announced. We stick to that thesis. Central banks, as we have said in the past, do not sell gold because they want to but because they have to -- the BOE being no exception.

Along these lines, we think you will find the first installment of our Myths & Realities series an interesting retrospective. Short & Sweet is immediately below. Please scroll. I had planned to update Short & Sweet this morning as I have tracked some interesting new material, but we've been hit with a blizzard here this morning and I ought to try to make my way to the office. I'll try to do something later this afternoon if its a quiet day at CPM, or possibly Saturday morning, since it appears we'll be socked in. In particular, James Grant had a particularly interesting essay recently that I would like to dig into. Have a good weekend, my fellow goldmeisters.

WOWSERS, look at a silver chart right now !
<;-)

<;-)

http://www.dailyreckoning.com/body_headline.cfm?id=1908In view of the host of recent positive economic numbers, even Greenspan is positive, while not yet convinced. As it seems the consumer is still the main "culprit" for this fast turnaround, if it is a turnaround.

Dr. Kurt Richeb�cher titles - Recovery Mirage!
snippet
"This unprecedented profits carnage is really the most ominous feature of the U.S. economy's present downturn. Equally unprecedented and ominous is something else: the fact that this recession has occurred in the face of the most rampant money and credit deluge in history".

Not much to add to Dr. Kurt's musings. Except that this hoped for recovery again is brought about by the american consumer. How much more blood can be squeezed out of the already financially kaput consumer in view of an ever growing debt- and RE Bubble?

If the stealth wealth of the consumer is the only foundation for recovery, I would suggest that it can't be much of a recovery, come reality.

There will be no lasting economic recovery until the imbalances of the boom 90's are worked off, including the leveraged derivative pyramid, and real savings - the only source of capital and its investment are rebuilt.

Until that time, which may take a while PM's will be the only safe place to be.

IMHO - cb2

PMs are still my prime purchasing which I continue to add...but I am considering buying some gas/oil and water that are not impacted by Middle East ...just starting my research

I know some of this board have experience in this area...any suggestions of companies I should include in my DD review

As always

Thanks

You're a great Board!
PS I did buy my shotgun ...no one is going to mess with my PMs ..or family!! (will add handgun)

Way to say it, bro. Maybe being a "doomer" means just having your eyes open enough to see when you're living your lifetime on the downside of a longwave trend. (Or waiting for Nature's next "surprise".) And having the spirit and love of life enough to enjoy it while you're here.

Raising a cold one (later, not at this A.M. moment. I'm trying to catch some Dow puts in another window) to Courage and Intelligence, though. They seem a strange anomaly in the long slide to Entropy.

<;-)

It seems from your Fed link that they are implementing the legislation that Congress has foot-dragged on. Others are studying the release more closely so I will wait until we have more minds on this.

Glass/Steagall's repeal permitted lots of stuff so this may just be a calibration that allows banks to own derivatives as hedges but not equities [But what's the real difference anyway?].

This may, just may be the vehicle that the Fed uses to "distribute" gold derivative losses to all other member banks in order to avert a collapse of JPM.

This piece appears to be an important indicator when viewed with the other cabal moves of late...they are not the moves of a confident, in-control group.

Japan is the key to me. Mrs Watanabe has the economic future of the Western World in her hands. If she, and a group of her friends, buys 122 ounces of physical each, then we see tens of thousands of tonnes of new demand...and the fall of the Japanese banks with the fall of JPM as a consequence...it won't take
long to play out.

Expansion and turnaround will require business (capital)spending. That's my reckoning. (IMHR)

RE: JapanI think Japan is beaten psychologically (that's important I think) and if I am right, there will be heck to pay globally. I mean, put yourself in the average guy's shoes. In Japan, the situation has steadily been going from bad to varying degrees of worse for over ten years. What has been coming out of Japan in the context of offial announcements does not even appear to be a glimmer of hope for improvement. The cure is strong medicine. They won't take it.

@ CM -Expansion and turnaround will require business (capital)spending. That's my reckoning. (IMHR)

Exactly, my friend. And real capital spending can only come from real savings, derived from real earnings.
The consumer and most of corporate america has spent today on (potential) future earnings.

Kind'a interesting the POG spikes on a day as today.

Regards cb2

Well said, sir your #70926Yes, all sides tend to stick heads in the sand when it suits a perceived self interest. Many who label the environmental movement with perjorative names are most often those who have a vested interest in a status quo that is profitable for them OR have choosen to believe a position of convenience for them without the benefit of having looked closely at the other argument. Often the solution to this is just taking the time to care and look at what is being destroyed. If a population does not care about an ecology that is the foundation of their collective lives, the consequences of neglect would seem assured. Having gotten my own feet wet "out there" (in the environmental sense) I can attest that the worries are real. But my arguments not only go unheard when stated, they are not even comprehended. It is easy to become discouraged.

And so we humans are increasingly having to make a choice between the "good life" of economic freedoms and the dictatorship results of these excesses. That the results go unpercieved say more about the human ability to look the other way, a stand on cultural/religious positions, a neglect any educational level of comprehension in the areas, or for the elitest the ability to handle tricky political situations caused by ecological damage in a more tricky mannor than their tree-hugging adversaries. But guess who gets the funding?

The problem with capitalism and free enterprise is that the ecological world does not function on the same principals. There is no such thing as profit in a closed system.

Or from another point of view: the debts of an economy can be paid back in time with pain and consumption adjustments; the debt to the world is increasingly not redeemable in the important areas insulted.

An interesting quote: "I have no confidence in the government or in man for that matter." Ironically the environmental side often says the same thing.... So far they have far more the reasons to complain. And perhaps they hold the high ground too, having deep concerns for what for many is mere abstraction, as opposed to their opponents who wish only to be rich on the more philistine measures of perception.

Best regards,

G.

http://cbs.marketwatch.com/news/story.asp?guid=%7B670E1B27%2DC888%2D4881%2DA617%2D20EE8E77524D%7D&siteid=mktwInteresting how much "they" may be worried....gold at $100 LOL....vs higher gold prediction...and the fight goes on...but it looks like it's just a matter of short time when maybe they will be saying gold might "fall" to $300


Tom Calandra (partial)
SAN FRANCISCO (CBS.MW) -- The price of gold is trying to keep its head above $300, with little success. Yet shares of the riskiest gold mining companies, the so-called junior exploration companies, are at their highest points since late 1999.....

"Gold stocks had a very good year last year, and they remain the top-performing sector this year," notes Robert Bishop, editor of the longstanding Gold Mining Stock Report. "Despite this, gold funds are not reporting new inflows of cash, and I sense there is a significant amount of disbelief associated with gold's recent flirtations with the $300 level.....

"Veteran gold investors, like Bishop at Gold Mining Stock Report, acknowledge the price of gold needs to notch more gains to keep the high-fliers, well, flying. "Almost nothing in the gold stock sector is cheap at this time," he is telling clients. Yet Bishop is very optimistic that bullion will continue its slow march across the $300 level and beyond. "My expectation is that the days of gold trading below $300 are severely limited."

Andy Smith, a Mitsui Precious Metals analyst in London, says "gold's ambitions as a contender (have been) left on the ropes." Smith points to recent testimony by Alan Greenspan, who chronicles the recuperative powers of the American economy. The strength of the dollar and a steadily recovering U.S. economy could force gold to "sink at least to one knee," says Smith, who predicts gold years from now will trade below $100 an ounce.....

Smith, in his just published report from London, adds a caveat to the Greenspan myth of the perpetual greenback: "What if, defying decades of honed performance, the perpetual progress machine of fiat money took a step backwards? Then, as Mr. Greenspan told the numismatists: 'We may have to go back to seashells or oxen as our medium of exchange.' " (Richard Nixon severed the price link between gold prices and the U.S. dollar 30 years ago.) The Fed chief added, "In that unlikely event, I trust, the discount window of the Federal Reserve Bank of New York will have an adequate inventory oxen."

Greenspan, in congressional testimony this week, clarified his oxen talk, saying the system by which the world's currencies trade against one another appears to have been successful, but he was not about to predict how long that would last. Smith, the analyst, is pessimistic about gold's role in the electronic economy yet still thinks there is room for gold prices to go higher this year.

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3WU4TZ8YC&live=trueA true and fair view of productivity
Alan Greenspan has endorsed an overstatement of US economic performance comparable to Enron's accounting methods, says John Kay � Financial Times
Published: February 28 2002 19:36 | Last Updated: February 28 2002 19:51

The collapse of Enron has shaken markets because it has reminded everyone that corporate accounts are interpretations, not facts. Even the most conservative of accountants has been under pressure to find statistical confirmation of the stories of heroic leadership, organisation transformation and technological revolution. Everyone knew these things were true, even if data were sometimes slow to reveal it.

This hubris distorted perceptions not only of the performance of US companies but also of the performance of the US economy itself. We talk about economic growth as if it were objective fact, like population growth or temperature. But national income accounting is every bit as much a subjective enterprise as the private- sector accounting on which it ultimately depends.

When politicians and pundits talk about economic growth they are referring to movements in the level of gross domestic product at constant prices. This concept is measured gross - no account is taken of asset depreciation or obsolescence. And GDP is deflated by a price index so that it represents the volume, rather than the value, of output. Such deflation was easy when output was mostly steel but is much harder in the knowledge economy.

A bar of steel is - more or less - a bar of steel: the volume of computers is an elusive concept. As computer prices have fallen, people have got more computer for their money.

But how much more? Statisticians use two main techniques. One is to track the falling price of the same computer. The other is a technique known as hedonic price measurement, which allows for changes in the quality of goods. Depending on how you do the sums, the fall in computer prices in the past five years ranges from 30 per cent to 75 per cent. Britain is relatively conservative while the US is very aggressive.

This makes a big difference. Real expenditure on computers in 2000 in Britain was about �10bn. The UK's Office for National Statistics estimates that computers that cost �10bn in 2000 would have cost �18bn in 1995. But if US price indices were used, the figure would be �37bn. The difference amounts to 2 per cent of British GDP. Over the five years, Britain's reported growth rate would have been almost � per cent a year higher if UK statisticians had used US price indices.

So what is the right answer? We are not trying to measure the benefits of computers. These may well be much larger than �18bn, or even �37bn, but such effects are already included in the output of the industries that use computers.

The �18bn figure is an attempt to answer a different question. What part of business spending on computers should be capitalised, rather than treated as a cost against current output, because it contributes to future rather than current output? General accounting practice allows you to avoid charging such expenditures against profits, with two qualifications.

You must capitalise it at its actual cost, not at some hypothetical measure of what it might have cost in the past or be worth in the future. And you must write off capitalised expenditure over the lifetime of the asset.

The rules for measuring GDP do not impose either of these conditions. They allow extravagant revaluation. And they do not require depreciation of the capitalised expenditure.

Under standard accounting principles, the maximum expenditure you could capitalise would be the whole of real spending on computers in 2000: �10bn or so. And you could justify this only if you could argue there was no need for any write-down of previous expenditure on computers as a result of scrapping or technological obsolescence.

My estimate is that the replacement cost of the stock of computers in Britain in 2000 was probably about �20bn. Available computing power probably rose in 2001 by 20 per cent or so as a result of net new investment, minus depreciation and scrapping. Because of the falling price of computers, this larger stock of computing power was probably not worth any more at the end of the year than the smaller stock was worth at the beginning.

A kindly auditor, such as the Andersen folk down in Houston, might allow you to treat �5bn or so of computer expenditure as capitalised. If a commercial company seriously proposed to credit �37bn to its profit and loss - on the grounds that this is what it might have had to pay if it had not bought them so cheaply - its directors would certainly face a congressional committee and probably end up in jail.

The bottom line of all this is that published data on GDP probably overstate output growth in the UK over the past five years - but by less than 1 per cent. Economists have known for years that constant price GDP was a flawed measure of output. But until the information and communications technology (ICT) revolution, errors were small and were offset by the advantages of data series that were comparable over time and between countries. US statisticians were quick to see the difficulties falling computer prices might pose and adopted a procedure called chain linking to reduce the distortions. Britain's ONS will follow but has not yet done so. The problems of interpreting US accounts are both complicated and reduced by chain linking. But the aggressive US assumptions about ICT price falls mean that the difference between GDP growth and output growth is larger in the US than in Europe.

Over the period 1996-2000, ICT investment contributed almost 1 per cent a year to reported US growth. Simply substituting net investment at cost for gross investment at revalued prices reduces this by about half.

The effect is that reported US GDP growth overstates the real growth of US output by about � per cent a year over the period. This accounting difference is equivalent to the main part of the productivity miracle that still enthuses believers in the new economy.

It is not just US companies whose figures are now in question. USA Corp capitalised much of its software expenditure, revalued that expenditure at the highest price it might ever have paid, calculated its profits without any depreciation of revalued assets and announced stunning results to its investors on the basis of these assumptions.

Who were its officers at the time? Bill Clinton, the former chief executive, may be spending more time with his family. But Alan Greenspan, who has repeatedly argued that US economic statistics should be more consistent with the optimistic reports of US business people, is still the chief financial officer.
++++++++++++++++++

A downward spiral...shown above in exquisite detail...unstoppable. Rotten to the core...ith Greensapn at the helm...a perfect "evil axis" chump.

He will never, ever admit falibility or culpability in the coming meltdown. He will continue to babble on in FedSpeak to the end...no wonder Lawrence Meyer quit in disgust.

Finanaces aside,the world is facing more than financial problems,we have holes in our ozone,fish stocks dying,forests depleting,population growing,deseases increasing,record debt and the middle east is heating up.At any time now we could have another terrorist attack,a collapse of japan or jpm chase,an earthquake in california
or any other host of natural factors which play into golds hands.On top of all this people are living and working longer.All of these factors did not exist before and have absolutely no intention of going away.So what do we do?The same as Japan ,bury our head in the sand and say"it will go away if i ignore it!"The current system we are running is not maintainable and at some point any one of these natural
factors could come along and rip any financial equation to shreds.Greensapn should have said " We may have a moderate recovery barring anyone of a hundred natural factors which are more likely to happen than the recovery itself!"

I'm proud to be a certified gold curmudgeon. My wife isn't always so pleased about it. Curmudgeons will inherit the gold. Alan Greenspans shiny New Economy will be repossessed by the gold curmudgeons of the world when he can't make the payments. Thanks, Alan.

Good weekend to all

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B285256B6F000AAFBB?OpenDocumentNot my topic much, but some may find it a "deeper dig" into mining values...

Cavan man..Your remarks about the pschology of the Japanese rang a resonant line of thought with me. I've had some business dealings with Japanese. I expected them to be "honorable", they were not. So since my wife was teaching the language I studied it for about a year,ugh,after 5 years I can barely remember how to say hello. Oh well, I just wanted to cuss them out in thier own language anyway. The answer to the banking crisis will be the result of concensus of one particular group ( as per custom), that group in this case will be the flag officer club of the imperial navy. The navy might be gone but the club remains.

Siochain... If you buy a handgun consider the likelyhood of using it without a moments notice. You can't afford to fool around with a safety and chambering a round etc. Automatics are very sexy but a ole double action revoler is mighty handy.

Nickel62..Freedom as a last resort! Beautiful thought! Every one of us lives at the edge of a legal abyss surrounded by lawbooks. Laws protect us?
Hmm, Argentina? It's warm there huh? Someplaces.

Defies any attempt to rationalize. Could it be the ESF to divert attention from PM? This certainly would explain AG's recent comments. Or am I getting paranoid?

well said Sir Goldnsilver.

Dow +262.73
Duck +76.50
S+P +25.60
USD +0.21
Gold +1.30
Silver +5.0
CRB +2.72
Bonds were down
Happy Weekend!
Rich

My dad used to say that this earth is a beautiful, wonderous place with only one flaw, that being too many people. He also held the opinion that this was only a temporary problem and wondered if the next dominant species would fair better after us. He was a kind, honest, hard working soul but his opinion of mankind bordered upon contempt. He thought quite a bit less of government.
I have a feeling that next week's BOE auction may not turn out as business as usual. I sense a disconnect between the equities index numbers and precious metals prices. POG and POS are coming of age, less dependant on other economic occurances. Not now nor ever free, but prices may be set more by precious metal market forces and less as a reaction to other markets' fortunes. Anyone else "feeling" any premonitions?
Happy weekend to all!
Rich

Will Greedy Moneylenders Collapse World Economy?

A recent lawsuit is exposing a risky scheme in which the federal government and some of the world's biggest banks are conspiring to keep the price of gold low in order to boost profits and prop up the United States dollar.

Exclusive to American Free Press

By Mike Finch

A lawsuit has been filed in federal court alleging that the U.S. government, with Wall Street's biggest banks, has been conspiring in a scheme to keep the price of gold low in order to boost profits for the world's biggest bankers while artificially keeping the U.S. dollar strong internationally.

Reginald H. Howe of the Gold Anti-Trust Action Committee (GATA) has filed a lawsuit (Case No. 00-CV-12485-RCL) in U.S. District Court in Boston against the bigwigs of the Treasury Department, the Federal Reserve and several banks for "damages arising out of manipulative activities in the gold market."

The suit alleges that since 1994 the government has been collaborating with the world's top banks to keep the price of gold stable. The banks do this for profit, and the government does this to fool the world by making the dollar look much stronger than it is.

Alan Greenspan, chairman of the Federal Reserve Board and William McDonough of the Treasury Department, and banks such as Chase Manhattan and J.P. Morgan are among the alleged conspirators.

"This manipulative scheme," plaintiffs said, "appears directed at three objectives:

* To prevent rising gold prices from sounding a warning on U.S. inflation;

* To prevent rising gold prices from signaling weaknesses in the international value of the dollar; and

* To prevent banks and others financial institutions, which have funded themselves by borrowing gold at low interest rates and are thus short of physical gold, from suffering huge losses as a consequence of rising gold prices."

Since Roman times gold has been an international monetary unit. It is a commodity that cannot be grown or reproduced. Because of this, much of the world looks to gold as a yardstick for the value of different currencies-even the U.S. dollar-until recently.

In the United States paper money was backed by gold until 1934 when President Roosevelt ended the do mestic coinage of paper money. Until 1934 you could trade your paper money in for gold coins-even at your local bank. Gold backed the U.S. dollar in international monetary dealings until 1971, and was therefore the ultimate measure of the American dollar as well as other world currencies.

In 1971 the United States ceased redeeming dollars for gold. Since then, the international payments system has "moved to floating exchange rates with no currency convertible into gold at fixed parities," said Howe. Paper money, which once was anchored concretely to the value of gold, was now set adrift.

Even though paper money was no longer formally mea sured by its gold backing, gold was consistently used as a barometer for inflation here and abroad. There fore, if the government could control the value of gold, it could falsely control the value of the dollar.

Right now the International Monetary Fund has shoe-horned the world into using the dollar as the international monetary unit; therefore the world has interest in the dollar's stability.

UNDERWRITING THE BANKERS

According to Howe, the Exchange Stabilization Fund and the Federal Reserve System have not been open in their dealings in the gold trading market. He said that the government is underwriting the gold loans of the big banks, and the big banks are trading to keep the price of gold stable.

The government is helping the banks manipulate markets to their mutual benefit. But the goods economy is based on manipulation of the gold price, not the true value of the dollar, he said.

"At least half of the Senate is aware of this but are doing nothing about it," said Bill Murphy, researcher and founder of GATA.

In dealing with public officials, Murphy said, "I've gotten the distinct impression that this is a national security issue."

BANKERS' IRRESPONSIBLE

The complicated scheme, Howe said, goes something like this: The big banks borrow gold on paper at very low interest rates and then sell it on the open market. The bankers then use that money to purchase stocks or even high-risk derivatives which yield higher returns. The banks then make a killing on the deal if their stocks or options appreciate.

According to Wall Street analysts, many of the world's biggest banks hold trillions of dollars in derivatives. For example, J.P. Morgan's derivatives holdings now stand at $29 trillion-nearly three times the United States' annual gross domestic product.*

The risk for the banks comes in the fact that they can only pay back the original loans so long as the yields on their purchased stocks are greater than the cost of the borrowed gold. If the price of gold were to go up even slightly, analysts note, financial companies like J.P. Morgan, which holds about 30 billion dollars in gold, could go belly up.

If gold increased in value from just $300 to $400, big banks like J.P. Morgan would then have to pay a great deal more to buy their gold back to pay off their debts.

So, in order to prevent the total collapse of the world's largest financial institutions, says GATA, big banks and the government have collaborated to artificially fix the price of gold.

The group alleges in its court complaint:

"Annual new mine production of gold in 1999 was approximately 2,500 metric tons, about the same as in 1998 and as estimated for 2000. At the same time annual gold demand is running at over 4,000 tons. Notwithstanding the annual excess of demand over supply . . . the deficit between new mine supply and demand, which has been growing steadily during the period covered by this complaint, has been met by scrap recovery, by some sales of official gold, and most importantly, by leased gold mostly from central banks."

Under the basic market principle of supply and demand, if the supply is the same as the demand, the price of a commodity will stay the same. What GATA and other people are arguing is that the supply is much smaller than the demand, so the price of gold should skyrocket. They say gold should be worth about $600 an ounce. But because the big banks and government are interfering, the price of gold has not changed. The government and big banks are creating a false gold market for their own profit.

If this is true, what happens when the bankers run out of real gold and paper to satisfy the market demand?

The price of gold will skyrocket, inflation will be back with a vengeance and big banks will have to pay the piper, says GATA.

One byproduct of this scheming has been the devastation of economies of the developing world. Sub-Saharan Africa, dependent on its commodity income, is being cheated out of the true value of its gold and consequently out of other natural resources.

Defendants in the GATA suit are the Bank for International Settlements, Alan Greenspan, William J. McDonough, J.P. Morgan & Co. Inc., Chase Manhattan Corp., Citigroup Inc., Goldman Sachs Group, Deutsche Bank AG and Lawrence H. Summers, secretary of the treasury under former President Bill Clinton and the current president of Harvard University.

in every season,
as all is told -
to accumulate

Gold!


'T was a good day - say's I -
All signals are green - like the green in span - and only one of the nifty 50 Wall Street scammers felt happy to go along with the spammers.

Bill Fleck has this to say - even if I may take the liberty to only post snippets - as it's similar to what I've had to say - or what?:

"Versus Expectation' Equals Speculation Japan was again firmer overnight, as were our futures. Europe wasn't doing a whole heck of a lot. When the casino opened for business, it bolted out of the blocks, ran straight up into the Michigan Consumer Confidence data, which was slightly lower than expected at 90.7 versus expectations of 91 (obviously not a big difference), and then backed off. Next, with the release of the NAPM (now called ISM) survey results -- 54.7 vs. expectations of 51 -- a protracted explosion ensued, such that after the first couple of hours, the Nasdaq was up 2%, the Dow was up 1% and change, and the S&P was up about 1%. The mighty, mighty SOX was leading the charge, up 6%. (More about the Sox later.) The bank stock index was dogging it, up about 0.5%.

.. and more, though Fleck say's ... you can't go (be) too wrong acquiring some insurance (As some do it at Black Jack)
- OK - it's time to double up - your gold!

Oh, I daresay, considering the elevated price? (vs what, which and whom?) ... cb2

Your statement: If you lived in an arid land and my people were dying would't I just go to war for the other guys resources. NO WAY! Thats why God gave us a brain. In the old days that was the only option but today we have done something different...Advanced. The eco folks hate it but it keep us from having to kill our fellow man just to exist. The problem (or any problem) is no water in an arid land. We take the salt out of sea water, we drill wells, we change the genes of our corn so it will grow in arid soil. we build aquaducts, Hell we go find an iceberg and drag the damn thing home...what ever it takes. We own our pleasured existince to men of the mind. Our intellect will solve these problems. The only reason to use force is keep evil from using it. Live Small.
RJ
Sochain the advice offered to buy a revolver is good advice. The "pucker factor" will come into play if you ever have to use it. Buy a good double action Colt, S&W, Ruger or newer Tarus in .357 mag 0r .38 spl.

I stand (well, actually sit - it's been a long day) corrected, Sir. Perhaps I will watch again.
=================

AGENT SMITH
I'd like to share a revelation that I've had during my time here. It came to me when I tried to classify your species. I've realized that you are not actually mammals.



AGENT SMITH
Every mammal on this planet instinctively develops a natural equilibrium with the surrounding environment. But you humans do not. You move to an area and you multiply and multiply until every natural resource is consumed and the only way you can survive is to spread to another area.

AGENT SMITH
There is another organism on this planet that follows the same pattern. Do you know what it is? A virus.

===========

Good weekend to all.

Today (3-1-02) the market indices soared higher on reports of a rise in mortgage applications and industrial metal prices, along with a fall in corporate bond yields, helped to push a weekly indicator of U.S. economic activity slightly higher last week, according to the Economic Cycle Research Institute. The talking heads, media pundits, and an assortment of Wall Street pimps now exclaim that the recession is over and the economy on its way to a roaring recovery. I believe that these claims are somewhat premature. However, if this is the case then what will derail this recovery? The answer could be inadequate supply of energy.

The US economy depends on energy and the demand for new power and gas is unbelievable. The US is an economic superpower. Without the US economy, the rest of the world's economies are toast. Like it or not, abundant "Cheap Energy" is the engine that drives the economy. There were even those who claimed that energy was not important anymore with the rise of the "New Economy". One such voice was the Fed Chairman Alan Greenspan. The truth is quite different.

Last year when energy prices soared due to failing infrastructure and inadequate supply, the US economy floundered and then collapsed into economic recession. Much of this was simple lack of planning and public opposition to expanding energy supply. California experienced a severe energy crisis with rolling blackouts. The energy grid is antiquated and in serious need of upgrade and repair. There are bottlenecks everywhere in the system. Some regions (such as California) impose onerous taxes on energy that are passed along to the consumer. Opposition (NIMBY) to construction of power plants, transmission grids, pipelines, exploration and production of hydrocarbons, coal, and uranium has only intensified the problem.

Let's assume that the economy is in recovery. Then demand for cheap abundant energy will soar to levels at or above those during the last "Energy Crisis". We have not worked to resolve the last "Energy Crisis". America has an insatiable need for energy. The inadequate supply of oil and natural gas will drive prices skyward.

The Energy Information Administration (EIA) projects that demand for energy will rise by at least 40% by 2020. I got news for you; we are now an information service economy. What that means is more energy consuming server farms will be built, an increase in Internet traffic, more powerful computers, more telecom use, etc. This does not even account for the increase in basic industry as the economy recovers. Everyone will want their "fair" share of "Cheap Energy". There simply is not enough energy to meet this booming demand. It will get much worse and we are due for a repeat of the "Energy Crisis" that flung the US economy into recession.

Third world nations in Asia such as China and in Europe, Africa and Latin America will demand ever more energy as well. This will draw off supply of hydrocarbons to those regions as well. Many new discoveries in these regions will find increasing domestic demand.

Planned new power plant construction had been proposed for over 300 plants. Those plans have been shelved with lower prices resulting from the recession and warmer winter weather. There is no incentive to build there power plants and improve the energy grid under the current low prices.

Natural gas production is falling again after a season of record drilling and production. Low Natural Gas prices have reduced incentive to keep producing. If the economy recovers there will not be enough production and supply, and therefore a repeat of the "Energy Crisis" is inevitable. Natural Gas supply will be very tight as power plants struggle to produce electricity.

The Middle East and the Caspian Region are wild cards. Anything can happen there. The US is a hostage to the whims of every piss ant dictator in a volatile region. Instability in the region will make "Energy Independence" the rallying cry and top priority for years to come. Otherwise we had better prepare for many more wars for oil and terrorist acts on US soil.

I think that with the current complacency of Americans as far as "Energy Independence" and rabid environmentalism is concerned, we will not likely emerge from this recession anytime soon. Not unless we see a real concerted effort to establish a secure and abundant supply of energy. I don't see that happening anytime soon.

- Black Blade

Might I also suggest a revolver for the following reasons:
1) no spent brass to trip over in the night on a hard floor.
2) fire multiple times while concealed in a purse or pocket, no "stovepipes".
3) simpler, more moving parts = more things to fail.

What Sir Trapper said also, .38 or .357, preferably a .357 - can always fire .38's and the added weight of the weapon will lessen the perceived recoil. Only six shots, but rarely is it required to reload to protect your home/family (Randy and the Davidians excluded). Firearms can certainly be worth their weight in gold, given the proper circumstances!

The unfolding spectacle is quite a sight. No question; we are heading for a crack up.

We've got to make the "mostest"! in corralling up the horses (some fiends say sheeple)in the OK Corral!

So may it be - Al G. is the Genie - gee, I could'a have known, should'a have listened and converted some of my FRN's to reality!

Forgotten ... as it seems ... though the reality of AG's liquidity spas'm - has diverted black beans (A. Anderson among these) to green peas.

Wish the peas would hold some - substance, though at least they're physical.

How about that, Pal?

I know, go gold and not the sweet JPMC peas of derivative extasy ... had my beans in New Orleans ...

cb2

BTW- keep what you've got in EU - it's your due.

http://www.financialsense.com/Market/wrapup.htmThe Missing Ingredient

Snippit:

There are, however, caveats to this scenario. The one missing ingredient in the upcoming recovery scenario is profits. Companies may be making sales but they are doing so at the expense of profits. Companies right now are operating under a brutal competitive environment so corporations don't have pricing power. At the same time raw materials and labor costs are rising, which means profit margins are shrinking. It's a terrible environment to be doing business with rising costs and the inability to raise prices. This is the reason for the wide variances you now see in market forecasts. The optimists see a recovery leading to higher profits. The analysts and economists fall into this camp. On the bear side are the companies, and they are the ones looking at their top and bottom lines and remain skeptical. Then there is the consumer who isn't sure which way things are going for the household. It has become necessary to supplement living needs with debt. The ratio of debt and mortgages to disposable income is now at 105 percent. This means consumers have to finance consumption through credit cards or installment debt just to get buy. The savings rate is negative so there isn't a spare cushion to whether a downturn. In the meantime daily headlines still point to further restructuring ahead with more companies downsizing. That will mean more layoffs ahead which has to impact consumer spending patterns.

This vicious cycle is what is throwing cold water on Wall Street's hot recovery scenario. Consumers are still willing to spend money, but they will only do so if there are strong incentive to do so. On the other hand, companies can still increase sales, but they have to sacrifice margins to make those sales with profit killers such as rebates, zero percent financing or steep discounts.

This analysis is absent in any of the recovery scenarios. From a macro economic perspective, corporate downsizing and consolidation has a negative effect on economic growth despite what it might do for profits in the short run. When a worker is layed-off, he is forced to retrench on his spending plans. The two main drives of economic growth are public consumption, and capital spending by businesses, which is the most important of the two. When businesses expand and invest in new property and equipment, this increases business receipts because the new plant and equipment immediately generate additional income. At the same time because of accrual accounting, the new investment in the plant and equipment is expensed over time. Without any meaningful increase in capital spending by business, this recovery will have no legs.

Black Blade: I agree. Good article as Usual.

http://www.financialsense.com/stormwatch/update.htmCrisis Intervention

Snippit:

The only difference between today and the inflationary era of Arthur Burns, Chairman of the Fed Board of Governors 1970-78 and Volcker's predecessor, is that under Volcker and Greenspan, confidence was restored in paper. People began to put their faith in paper assets such as stocks, bonds, and money market instruments. Instead of buying things as they did in the 70's, people invested in paper. The government was very careful to keep faith in paper alive. It was possible because the price of gold, an important barometer of inflation, was kept suppressed. Gold became the nemesis of all central banks. If its price rose, it signaled something was wrong with the financial system. As a consequence, it became necessary to keep its priced suppressed. This was made possible by central bank gold sales, gold leasing and the gold carry trade. Through the use of physical gold sales and paper gold sales it became possible to keep a lid on gold prices. These action, combined with discrediting gold in academic and financial circles, made the whole scheme work.

Black Blade: Good article.

http://www.feer.com/articles/2002/0203_07/p037money.htmlThe opinion from other wise ones is that this Feb 21, 2002 rule making, or interpretation by the Federal Reserve involves the implementation of the early structure of the CFTC Reform Act of 2000.

What the ultimate effect will be remains in the future. To me [Happy not to be a lawyer] it seems like the big banks want to spread around lots of stock derivatives, futures and options to help "stabilize" the markets.

It won't work� in so far as investors know when they are being shafted. They know when things are unstable and when the government is fudging the numbers to cover a mess of their own creation.

Moreover, the current rise to a six-month high in the DOW is a thin facade. It is better to be long gold than short the stock market. This, because the Fed can and will print an infinite number of dollars to perpetuate their reign.

However, the limiting factor in their scheme is they cannot print gold to continue selling against a rising flood of concerned buyers in Japan and elsewhere.

No matter how many bogus articles about gold are floated to steer folks away [like today's above link], they only draw more and more interest.

The above piece from Japan offers bogus savings numbers saying that only 1% of savings are at risk. By direct calculation from the Japanese population and savings data posted at the official government website, there is $600 Billion at risk, mostly in the hands of the group 60s and 70s and up. They each have $150,000 and $158,000 of NET savings and that means they have over half their life savings at risk...exclusive of real estate holdings. This piece is just another attempt to obfuscate the truth about the pending train wreck for the Japanese government...noted for its Olympian skills in denial.

As April 1, 2002 approaches more and more will check and learn the worst�they are vulnerable. Like US tax procrastinators they will move at the very last moment. God forbid there should be articles about Mrs. Watanabe losing half her life savings because "It wasn't insured". Only 1.7% of the funds at risk is equal to 1000 tonnes at $300 per ounce.

They will overwhelm the central banks�it won't even be a contest. Today it's a powder keg. The slightest tilt and Eddie George's "Abyss" happens.

It will do no good for the casual observer to wait until that day to buy gold�for once the tilt goes, there will BE no gold to acquire�anywhere�at any imaginable price. ALL the available exhaustible rersource will be consumed in the speculative attack...in an instant [Currency Crises experts such as Maury Obstfeld, UCLA have modelled this dynamic for decades]. Thereafter, the resource will trade at it equilibrium level. BTW the level reached after the last great gold correction [1971]?

It was ten times. However, there really wasn't a multiple bubble, runaway economy combined with plunging confidence in corporate transparency and a war to boost pog like there is today. Figure ten X is a minimum.

The ominous pattern this week of a rising gold price succeeding against all the concerted efforts of the Fed implies that forces equally as powerful want to buy all the gold the Fed has. After all, it only takes $9.6 Billion to buy 1000 tonnes�not too much for a determined hedge fund manager or three who KNOWS the Fed is up against a wall. There must be fifty ways for voracious Wall Street, financial predators to get in on the fun.

The real question is when will the Fed capitulate and save at least a few thousand tones to fight another day. From an analysis of the Chairman's past behavior, a pattern of denial upon denial evidenced in the latest FOMC minutes from 1996, he may drain the entire Treasury of every last bar and then shrug and try to retire. Picture Greenspan pulling a "Skilling"..."Things were FINE when I left", "The GDP was primo...wasn't it"?

Cooler heads will prevail and remove the good MoTU...but only AFTER he has completely lost control�when gold hits around $350 per ounce.

Then the new MoTU will be brought in to be sacrificed...Argentina style.

But what could save the day; surely something or somebody? There must be a better contingency paln than treading water.

After watching this pot boil for three years I am having a hard time being convinced their game is almost played out because I thought so three years ago!

Snip

Speaking of flushing Black Blade, I see that you have your hand on the handle. The farmers in Montana are just about to get your �flush� of coal bed methane produced water. This water, that is produced, is very high in salt and is being discharged now into the rivers. It is projected that there will be thousands of these wells soon. The farmers down stream are being forced to use this water to irrigate their crops. Salt water has a limiting action for growing crops as well as a more extreme function of affecting the soil structure so that after a few years nothing will be able to be grown on this land. And I mean FOREVER.

I can certainly see how these gas men have the right to develop their gas wells, but I think that they should be made to do it in a manner that doesn't degrade the high quality of the water in the Tongue River. If the farms are forced to take this salt water they will soon become unable to make a living while the developers are making huge windfall profits on cheap gas production. You may not live the city but you nevertheless are flushing your sewage on the unfortunate folks that live downstream.

I invite you to take a trip down the Tongue River Valley and see the 100-year-old farms and ranches and beautiful treed bottoms with hay meadows. As the Tongue meets the Yellowstone River the farms are enjoying the long growing season, good soils, and high quality water to grow a variety of crops. At one time this area produced all the vegetables for this part of the country. When the full force of the salt water reaches this area it will be quite a different environment. So when you call the city dwellers "defilers of the environment" you might just take a closer look at what you are.

From another forum:

"Jeffrey Skilling just warned of an upcoming deriviatives implosion for the USA economy.

He is on Larry King Live right now."

Hope this is true!!

Canuck.

snip

You might want to take a good look upstream or all your hard work and saving may be for naught.

A thought occurred to me as I read your post.

John Kenneth Galbraithe I thought developed a pretty good argument relating growth in population densities as having a detrimental impact on democratic freedoms. To paraphrase it went something like this: the closer people get to one another and have to respect each others rights the more these rights have to be legislated for by government action to quell friction- which in turn tends to limit the freedoms of those it ostensibly is supposed to serve. As a structural political paradox it is hard to beat.

From these tensions come the "property rights" argument. So the miners have more or less the right to polute a farmer's land - until the farmers lobby hard enough to present their rights to farm to the governing body to mitigate the negative influence from the mining rights. Until this happens both have equal rights to do exactly as well as they can under the then existing rights of law. Exactly the same situation would surface under firmer "property rights" laws whereby the landowner, if he chose, could cause untold damage to his neighbours until the injured parties got enough support from state or federal government to force respect. Again a problem of crowding when to solve one problem the solution is damaging to the other. And one wonders why there is corruption? Crowding of many economic activities inevitably results in winners and losers and "I was here first!" is seldom a sufficient argument.

For every gain there is a loss, for every loss there is a gain.

Regards,

G

http://www.cnn.com/TRANSCRIPTS/0203/01/lkl.00.htmlKING: Was this, then, preventable?

SKILLING: I think Enron, when it all -- when it all is said and done, might turn out to be a little bit of the canary in the coal mine. That I think there are some structural things in the economy right now that -- unfortunately, a lot things happened altogether. The old, sort of, what they call the storm -- the perfect storm kind of analogy that a lot of things happened suddenly and once that -- once that domino starts falling, it's pretty darn hard to stop it.

As far as I know there is one producer - (Northern Energy) that is involved in the Tongue River discharge controversy. For the most part these CBM producers discharge into "holding ponds". I think that your argument has to be with the Californians who demand this "Cheap Energy", much as the Colombia bears the brunt of US action against growers of coca, it is the addict in the US that demands the product. The question is who is more culpable?

Aside from that I am not aware of the farmers and rancher involved. Those that I know are very happy with CBM as they have profited handsomely and it has saved their land from bank confiscation. Many a rancher that I have talked to is quite happy with CBM exploration and production. Many were worried that they would have to sell the family farm to take care of their families. Not every area is subject to alkali soil leaching (as you refer to salt).

As I have said, if you steal lands from the native Indian peoples (in this case the Shoshone, Blackfoot, and Cheyenne), then the minimum you could do is to steal the mineral rights as well. Cheers!

- Black Blade

http://www.telegraph.co.uk/news/main.jhtml;$sessionid$KZFRXMIAAAXOTQFIQMGCFFWAVCBQUIV0?xml=/news/2002/03/02/world02.xml&sSheet=/news/2002/03/02/ixworld.htmlSnippit:
"AFTER a decade in which stocks have slumped by 70 per cent, with property values halved and interest rates close to zero, the mood in Tokyo's financial district is almost universally gloomy. But in recent months, retailers of gold have been enjoying a boom in sales.

Japanese are turning to the precious metal, typically bought during times of war and crisis, as a safe haven. It is prized because it can be carried and stored easily and because it endures while currencies and economies collapse.

Waverider: There's really nothing new in this article that hasn't already been discussed here - but it's great to see Gold acknowledged as the ultimate safe haven by the mainstream media...word is getting out... Cheers!

A very interesting observation from one standing back and viewing the entire scene.

We have a saying in the west "water flows uphill, towards money".

The four Billion $$ expected to be produced from the gas wells is no match for over 100 years of history or present low farm income. Who cares if the farms will not be able to produce food in the future? We all buy our food from the store anyway. Maybe we can just import it cheaper anyway.

Thanks for the thought provoking post.

Rx Gold

Fidelity and Redstone are the producers that are at this time dumping in the river. They do have some containment ponds for their discharge. These ponds are unlined and sit in the drainages. Water infiltrates to the ground from these ponds, which later ends up in the river. Some of the discharges are piped directly into the river.

The happy ranches you refer to are the ones that are lucky enough to own the mineral rights under their land. The ranchers that aren't so happy are the ones that have BLM administered lands and state lands on their ranch. On these ranches the gas boys just roll in and tear up the range putting in roads, waste water ponds, pipe lines, well sites, electric lines and noisy compressor stations ALL over their ranch. The Government leased these lands out from under the ranchers for around $3 acre without giving them even notice that they were going to do it. When they pump these large quantities of water it depletes the aquifer and the neighboring ranches suffer from lack of water for their stock. The neighbor might not want to ruin his ranch, but if he doesn't, the neighbor just sucks the gas out from under him.

There are two different aspects to this operation: ranch destruction in the area of production and farm destruction down stream. Both of these problems can be remedied by responsible production. If they want to produce the gas they should be make to either re-inject the water or treat it with RO (reverse osmosis). The gas boys don't want to do this, as it will cost them $$$. Much cheaper to dump it in the river. Some of these wells produce over $8000 of gas per day. If they weren't so greedy they could spend a few bucks and we could all live happily ever after with the lights on and food on the table.

I am not talking �alkali soil leaching� when I talk of salt water. I'm talking about high SAR (sodium absorption Ratio) and EC (electro conductivity) and TDS (total dissolved solids). These are the measure of salts in the water. Over 60% of the soils in the Tongue River Valley are very susceptible to even low levels of salt. The salt combines with the clay particles and makes the ground impervious to water. There can be no leaching, as the soils can't move water through them any more. They become �Dead�.

Rx Gold

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3X1U619YC&live=true&tagid=ZZZ60A9VA0C⊂heading=americasSnippit:
"Ecuador's President Gustavo Noboa says he will use his remaining months in office to push through reforms deemed essential if the Andean nation's dollarised economy is to prosper. Mr Noboa denied that Ecuador's economy risked going the way of Argentina. "We've been getting back on our feet for the last two years and I'm optimistic about the future," said the president."

Waverider: Esto es verdad? Planeo para ir a Ecuador este invierno para que el art'culo agarr-- mi atenci--n. Los pensamientos? BTW para preparar, estudio el espa--ol y busco a gente para conversar. Si usted apreciar'a conversar acerca de oro, la econom'a, la pesca, el precio de arroz, mi direcci--n es mi nombre en shaw.ca Yo pienso divertido pero mi espa--ol es muy malo! Si no, entonces usted me ha salvado el trabajo de traducir! Gracias y las vivas!

I wouldn't know about Redstone Gas Partners or Fidelity Exploration's operations, as I don't do business with them. I have minimal contact with JM Huber though. Most of my business is with companies out of Gillette. There are regulations as to the amount of discharge into the Tongue River and much of that is related to the amount of run off water flow. As you know there has been a drought the last two years here. Therefore the runoff levels have been very low. There may be recourse if these regulations are being ignored and the proper channels are through the regulating agencies and perhaps the courts. I seriously doubt that the revenue that you cite for Redstone is reflective of reality though, especially in view of the current low NG prices and the onerous pipeline fees involved. Besides, I am quite familiar with the geology and the questionable quality of the coals involved in this area.

As I have said - if one steals land from the original owners to farm and ranch, then there is no right to complain as I see it (after all I'm part Oglala Lakota Sioux - supposedly of the Tapisleca band). Life is not fair, nor is it supposed to be perhasps). It would appear that your argument is with the US Government and the energy addicts in California who demand that the methane be produced. There is certainly something to be said about owning the mineral rights. Like a bumper sticker I once saw - "The meek shall inherit the Earth, but not the mineral rights". Cheers!

- Black Blade

La manera mejor de aprender el idioma espa--ol es al imerse a s' mismo en el idioma y cultura. Yo nunca fui a la escuela para aprender el idioma. Yo aprend' de mi amigos de ni--ez y sus familias. Mis amigos eran Mexicanos y Cubanos. Yo tengo unos amingos de Espa--a y Basque amigos del region in el Norte cerca San Fermin (qu� es un lengua muy diferente de castellano). Un colega acad�mico m'o fue a ense--ar geolog'a en Chile. �l vivi-- primero en Chile durante tres meses que aprenden el lengua primero. Afortunadamente espa--ol es un idioma bastante f�cil para aprender. �Suerte buena!

- Black Blade

BTW, my plate is full.

I must say i'm impressed in golds climb despite the dow up and the upcoming Bank of england auction on tuesday.One must wonder which bank will want to unload now?March could be a very bloody month for those in the gold derivatives such as JPM chase.Japans govt insurance on bank deposits over $75,000 comes off april 1st and the chinese say they will open their gold exchange in the first quarter.

Have you noticed the sudden rash of mergers in goldmines lately?They dont want to admit,they know gold is set to explode.But if they say so they will have to pay more for the smaller gold companies they are buying up.We saw gold jump up $25 in one week recently,and i believe March will be the month gold starts to shine.Those Japanese are shrewd and they have a lot of savings to go up in smoke.Once JPM gets in trouble,another of golds major foes will stumble.Bundesbank,another major player'showed its hand by bluffing a sale it cant do until 2004 under the washington agreement.

A good test will be how POG reacts to the last BOE auction,if it quickly rises through $300 afterwards it means the price only dropped so someone could buy more at a cheap price,once again fleecing Boe.

The so called last boe auction is not the last auction. There will be a new anouncement soon. On this so called last auction, like all other auctions, no physical gold is (was) sold. It is simply an exchange of gold sold forward. The Bank of England and Greenspan are pulling a Skilling. Greenspan wants to drain the entire Treasury of every last bar of gold and place it into private hands. This is also true with the gold that so to speak belongs to the people of England. Same is happening to most other countries around the world. The Fed can and will print an indefinite number of dollars to support the stock market. Presently the Fed is the biggest buyer of stocks. It already owns the GSE's and in most part the bond market. The Fed is presently monetizing Japan's holdings of Treasury's. The only limiting factor of Greenspan's scheme is he cannot print gold. Hedge funds are buying physical gold to use as credit creation just like central banks use gold for. Soros, Gates, Buffet (sp) are all doing the same thing. Right now it is better to be long gold then to short the stock market. But this only works if corporations can put all this new money to productive use. Right now that is not happening. Our national on the books national debt and off book gold short positions are increasing at the fastest rate ever recorded in history. Real productivity is going down under the stress of too much debt. This military spending to commit destruction is not positive productivity. Nothing real is constructed that will help improve the living conditions of most people. Politicians like many trees in our dying forests have the same problem. They are crooket, not straight, have a crook, dishonest. --Greenspan at a BIS meeting said " "my dog can lick anyone.

Has there been a rash of mergers in the juniors that you are aware of? Or are you referring to the Newmont-FN-Normandy type of thing? I would be interested in any low profile mergers in gold mining companies. There are substantial numbers of old mines out there that if merged into one company might make a decent investment for a rising market. Dayton Mining, Aetna-Expatriate with the Wolverine mine, Freeport McMoran Copper and Gold and anybody who could ensure that the chance of confiscation by the Indonesian government was lower or a host of other properties which have languished with the decline of the last six years.

Well spoken....and let us not forget the drum beat for privatization of social security. This is but another ploy to get dollars into the stock market.

The stock market MUST be kept up no matter who gets hurt. Should confidence in the SM fall, there will be a rapid flight of investment out of US...and concurrently out of dollars. This, of course, can be brought about by other things re Japan...oil/Euro but I believe that as long as the Market can be held together with stirng and chewing gum and whatever else can be found....the game will continue.

This is a race against time...companies do not appear to be recovering, Yes, there may be some blips for inventory replacement in the near future...but the only thing holding us up is the consumer...question is...when will American consumers fully awaken to the shell and shill game?...and most of all, the loss of many priciples upon which The US was founded.


"The money powers prey upon the nation in times of peace and conspire against it in times of
adversity. It is more despotic than a monarchy, more insolent than autocracy, and more selfish than
bureaucracy. It denounces as public enemies, all who question it's methods or throw light upon it's
crimes. I have two great enemies, the Southern Army in front of me and the Bankers in the rear. Of
the two, the one at my rear is my greatest foe..corporations have been enthroned and an era of
corruption in high places will follow, and the money powers of the country will endeavor to prolong
it's reign by working upon the prejudices of the people until the wealth is aggregated in the hands of
a few, and the Republic is destroyed. --Abraham Lincoln

Dear Sir

I see that you have changed your position from 'Holier than thou' to 'So, sue me'. As you know, there are lawsuits in place now and others that are in the works. All this does is make the shark profession richer (I have two in the family).

Rx Gold

I find that I just can not listen to so much bs in one sitting anymore. I tried to watch Larry King playing softball with Skilling and his lawyer last night and had to turn the channel. I tried to read the transcripts posted here this morning and couldn't make it more then half way through. How long is the US public going to believe this crap? I was the CEO and oh by the way creator of and sole employee of this thing called "the Enron wholesale merchant business" appropriately named Enron Financial. And Skilling expects the public to believe that while he was promoted to CEO in his early forties his ten years with the firm never allowed him to in anyway have any knowledge or involvement with the financial rigging that brought the firm down. My God man, do you think the entire world is as stupid as your regulators? This apotheosis of "Clinton speak" makes me even more sick than Hillary and Bill used to. Where are the questions about why since nobody seems to have a clue what happened at Enron, how about the simple obstruction of justice by the shredding of all the records that would have made liars out of these crooks. How about the "suicide" of the main potential witness? What has America come to?

What Skilling said:SKILLING: Yes, Enron was a result of the merger in the middle 1980's of two pipeline companies. As the markets began to go through deregulation in the last 80's, that business became very tough. And in the late 80's, a decision was made to really kick off two new businesses: a wholesale merchant business, which was really to start participating in the new deregulated markets for natural gas, and an international development business that was building power plants and pipelines around the world. I was really brought in to start and manage that merchant -- wholesale merchant business.

What he meant: This was a simple bunch of boring businesses and I came in and got Wall Street involved in creating a supposed "energy trading business" that was built on slight of hand using accounting loopholes. We then started using the fabricated revenue growth to suck in unwitting investors who thought we actually were making money. I sold a lot of stock at the top but not all so that I could claim I was a victim if it all came tumbling down. Don't worry though I hid enough of the money from my stock sales that I will be fine no matter what happens. Why does my mother come out in public and call me a liar? I don't know she must have facts I don't chose to admit.

There's a point, perhaps more obvious to the outside reader than to the writer, where it turns from the topic to the personal. We've mostly done a good job of avoiding that here. I want to continue to value your contributions, as it seems you have been on some good topics lately.

As part of our rules, we do not allow advertisements, but we are not shy about billing those who "forget" the rules from time to time and inadvertently post a url to one of the mining companies, a competitor, etc. The fee per advertising post is $2500. You will be receiving a bill via the US Postal Service and by e-mail. Your prompt payment will be appreciated. Thank you for supporting the USAGOLD Discussion Forum.

http://www.powderriverbasin.org/ An excellent point Sir. I have been out working and chewing on my response. I do realize that I made a mistake and although I can never take it back I can hope for forgiveness from the forum. I will certainly try to maintain in the future.

For those interested in the situation that we are discussing they may go to the above link to learn more.

Rx Gold

http://www.powderriverbasin.org/press_releases/our_comments_deq.htmSnip of link.

"At current market prices for methane, all 4 treatment or disposal options may be economically feasible." It seems clear that the industry can easily afford to treat and dispose of the produced water in an environmentally responsible fashion. And finally, on this subject of economics, complying with both state and federal laws and regulations is a cost of doing business and if some in this industry have failed to factor that cost into their business plan it is not the regulators nor the public's responsibility to bail them out or cut them a break.

We have the tools and the ability to solve these problems before they occur, we need the leadership, vision and cooperation to get it done. I hope we do not look back on this development at a series of environmental disasters that becomes the textbook example of what could have, or should have been done. We owe it to ourselves and to the generations that will follow to do it right the first time, to take the preventative measures that will protect our water quality and the environment and still allow the development to proceed and prosper

but I thought this forum was to center on gold, the economy and stuff like geo-politics and the influences it has on the former. I agree that oil/NG and energy in general has a big impact on our subject here, but it seems to me that some of the posts have turned more towards personal agendas than anything to do with our normal discussions. Anybody else notice this, or am I mistaken?

"What has america come to?"My friend, we've come to the end of the "america" which, in my not so humble opinion is more than a place; more than just a piece of planet earth's real estate. America is at once a concept, a dream, and ideal, an experiment. Today, she is but a cipher of her former self. The future of this country is very clouded. I admit to loving this country dearly but, I doubt my children will be raised here.

May God have mercy upon us because no one else will.

Thanks for a reasoned response. I feel passionately about these things, too, when the information has gotten through my thick cranium. I'm about overdue to grab up my lance and ride off on my charger to make one of these causes my life (or next decade) legacy work. (Kinda boxed in at the moment, though.)

I'd just like it to be with someone like BB, who sounds like he's been around a few skirmishes, or you maybe, in my company. With that blood, I know that when he looks across at the other side, and tells me "Today is a good day to die. Bring it on, m***********s." we're gonna count some coup.

You never know what activities a good board could morph into or spin off. Good minds meeting at their best, weeding out the propaganda on all sides -- anything could happen.

Disposal of my (Ohio) oil well brine (production water) must be done by a licensed hauler who takes it to a disposal well for reinjection. In the good old days each well including mine had a "soup" hole next to it for surface brine disposal. Stricter disposal rules were established because sometimes brine was discharged directly into streams causing fishkill and downstream quality problems. It costs me about $2.00/bbl to dispose of production water and since my well is 50/50 oil/water I pay $2.00/bbl for water disposal for each bbl oil produced. Also in my production costs are the $3.00/ bbl oil discount that my oil purchaser pays me to pick up crude from my on-site tank battery, ie., if I were to call in a pickup today I would get $19/bbl instead of the terminal price of $22/bbl.

It's just a matter of economics whether the enviornmentally friendly disposal costs can be justified. Even as a producer I would much prefer to have the appropriate disposal regs established and then let the market price for the product determine if it's feasible to drill and produce.
The real problem occurs when the investment in production is started under the more lenient rules and then is changed so that the original investment would not have been justified.

This subject is appropriate for this forum because the same disposal/reclamation issues are faced in the mining and separation of gold. In fact one of my gold mining investments is currently prevented from mining their deposit due to a Montana ban on the the most efficient technology that is used by others with great sucess.

I am responsible for some of these posts. I know what you're talking about, and I don't think it's a terrible thing. We're all sensible people, and I think some of us develop a closeness in this forum, and perceive others as our friends. Sometimes individuals share personal goals and desires with their friends in hopes for some sort of feedback, it's human nature. I do try to make an effort to keep my posts gold/market/political related, but sometimes I will veer slightly from those topics.

http://biz.yahoo.com/rb/020302/business_bizge_dc_1.htmlCheck out GE's latest ad strategy, real vs. paper.

snippet;

"GE is touting its industrial and technological might, something that was considered passe by many during the go-go 1990s, says Jack Trout, a marketing strategist at the helm of Trout & Partners Ltd.

``This is the return of the big-time industrialist making stuff, selling stuff -- real stuff,'' he said.

Largely absent from the new ads are references to the company's financial services arm, GE Capital, which contributed a whopping 40 percent of GE's $13.7 billion in earnings last year."

``People understand microwave ovens and sonograms as somehow being useful. (Lending) is not typically the type of thing you associate with corporate munificence,'' said Bob Garfield, television commercial critic for Advertising Age magazine, and co-host of National Public Radio's 'On the Media.' ``Jesus didn't clear the temple of the toaster users, he cleared it of the money lenders.''

Boilermaker:
This smells like a smokescreen for a shaky credit business. Maybe not, but if they were serious they would put the accounting cards on the table and reveal details about what's in their finance business "assets" and the performance of these assets.

http://www.energyintel.com/ResDocDetail.asp?document_id=41286
Snippit:

I understand that many coalbed methane producers had figured they could profit in the Powder River Basin at a price of gas from $.80 Mcf to $1.60 Mcf, the going rate today on the market has held steady for the past several months at over $5.00 an Mcf and is trading on the futures market today at over $8.00Mcf. The projections are that gas will hold steady at $5.00 over the next two years. Furthermore, the DEQ has also determined in a review based on industry's own economic analysis of water treatment and reinjection options that at a market price of $4.00/Mcf, "�implementation of the most expensive option (ion exchange at $1.42 Mcf) may a yield a net profit of $1.43 Mcf and could provide a sufficient rate of return to support full development of the resource.


Black Blade: Funny, I would like to know the source of this data. If you provide it please direct me to the source. Currently NG spot is $2.36 Mcf (variable depending on which hub - see URL). The futures prices are nowhere near those quoted in the article. Also that does not even factor in service and pipeline fees. Perhaps you could provide me production costs for the various producers as well. I do agree that there should be no breaks to any business, including the government subsidies for all users of the land, including the miners, gentlemen ranchers and farmers. It should be a pure free market play.

BTW, 23 N. Scott St. - isn't that the Sierra Club office near the intersection of Main and Coffeen? And aren't both these organizations affiliated. Hmmm�

You hit upon a theme that I seem to hear more and more, and a possibility that I'd like to explore. "We are an EXPERIMENT". Several years ago I read a book (sci-fi) about another planet's inhabitants coming to this planet (earth) for the sole purpose of mining gold and returning it to their planet. However, the mining was very hard physical labor, so they created an experiment (us, humans) to be their slave labor. That was just the first few pages, then it went on to give the history of man and gold down through the ages and their relationship. but after many years, the eathlings learned the many uses and value of gold and decided they wanted to keep it from their masters, and the story goes on.

But it made an impression on me - one more possibility of our existence with our love of gold.
Thank you for reviving that thought. Later,Interstate

I am not sure of the info on the website that I linked to. You might contact them about that. I got the figure of $8000 per day from one well at a meeting that was put on by the Coal Bed Natural Gas group in Miles City last summer. They had a BIG dog and pony show with a great bar-b-q for the town folks. I was amazed at some of the information that they presented, such as a photo of the water coming out of a pipe directly into the river. The had provided some rocks to help prevent erosion, which was why they had the slide.

To get back to the 'real' buisness of the forum....

I was working in the mining camp of Silver Peak, Nevada while the silver boom was on early 80's. The mine in production at the time was the Sixteen to one and it was run by Sunshine Mining Co. The miners were contract miners and were well paid. They spent most of it at the three bars in town. I remember well the silver rounds that were freely bartered across the bar. At that time silver was fetching around $14-18 per oz. Sunshine miners could buy the silver directly from the mine in one oz rounds that were numbered. One round was worth $20 on the bar as they were hard to come by. Local folks bought them like candy from the bar keep. More on this latter.....

Anybody out there have stories of gold/silver being used as 'real money'?

Rx Gold

Someones Buying, MORE! Went to the coin dealer to pick up the usual. All the one oz. eagles were gone . He had one Krugerand so I pinched that and frowned at the tax I had to pay on it.But things have a way of turning for the best. After paying for the Krug, he mention he just recieved some silver. In his display was about 10/10 ozs. a 100 oz bar and plenty of 1oz. rounds. I asked him if business was good and he said yes.
I asked him did he have a lot of sellers when gold hit $300.00 and his reply was NO. In fact only ONE! In our conversation on Gold he mentioned that not only was there an increase in small purchases but large purchases of gold is on the rise. One took a month to fill.This news is good of course but, what he told me next made me pay closer attention. He said he had a family member working for a credit card company and the accounts he manages are those who are behind on the average of $35,000 for 90 days. His department is a large section and they have two shifts working. That is in my neck of the woods. I am beginning to wonder if the average household credit card debt is really only $8,000.

Soon we have the BoE auction . Followed by Japans cut in bank insurance for deposits April 1, 2002. Two major actions which should affect the price of Gold. BoE selling and Japan buying and Gold sitting just below the $300.00 level. And a mountain of debt that has not fully shown its face.

To borrow a line from one of our Presidents, "We have nothing to fear, But fear itself"

Piddily Report; All the News so Piddily, Others do not print it.

Slingshot

slingshot (03/02/02; 16:18:45MT - usagold.com msg#: 71012)
Piddily Report.
Someones Buying, MORE!
Went to the coin dealer to pick up the usual. All the one oz. eagles were gone !
====
The Hobbits just had a payday and soooo --
CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK, CLINK.
<;-)

All GoneGot to love those Hobbits.

slingshot

Bob Chapman has excerpts from
THE INTERNATIONAL FORECASTER 2, March 2002 (#1)
at
The Toulouse-Lautrec Table

"If you think Congress is going to come up with
derivative regulations, think again. Most all of them
are paid off. They passed legislation over a year ago
allowing Enron type contracts to be done with absolutely
no oversight. Don't you get it, Congress has been
purchased. They don't represent you or us, they represent
the elitists. Derivative contracts have totally
undermined our financial system. Enron was unregulated,
as is GE Capital, because they are not a bank or
securities firm. Who advised congress to not regulate derivatives? Alan
Greenspan, Larry Summers, Arthur
Levitt and Robert Rubin, who else? The problem is the
Congress, business, government, academia, big labor
and politicians are all in bed with the elitists and
we get screwed."

That wasn't the type of experiment I was thinking of.

http://www.zealllc.com/2002/digigold.htm You asked, "Anybody out there have stories of gold/silver being used as "real money"."
The link goes to Adam Hamilton's weekly offering explaining digital gold as money. Apparently it is being done.
Rich

It seems a little risky to me. Have you tried it?

I like the clunk fine silver makes on the bar. When you slap an oz on the bar everyone turns to look. Somehow it just doesn't feel the same with plastic.

Rx Gold

What's different this time compared to the last three years is the Japanese cap on savings and its obvious relationship to a "bank bailout", allot less US reserves as a result of the WA, big hedge fund buyers and not the least GATA.

Strange as it seems GATA is the brightest illuminant and has dredged up all the pertinent facts to expose the operations of the anti-gold cabal. Each day brings more, although at this stage we certainly aren't releasing all we have. The old guard gold "analysts" have been conspicuously absent from this important battle.

Many intelligent people across the globe have been convinced by GATA and are acting on their convictions. But the biggest charge of explosive [Now with a lit fuse] is found in the exposed savings accounts of the elderly Japanese.

The government there is just plain corrupt and moms and pops know it and are in a bind as April 1, 2002 approaches. If the yen falls, even a little, a trigger mechanism is tripped. If a big insurance company fails, a trigger mechanism will be tripped since it would drag banks with it. If more banks fail after the deposit insurance deadline [two more little ones this week], even more problems happen since word of uninsured losses will travel like wildfire.

It all is at the point of maximum disequilibria moving to "D" Day in April.

The Japanese not going to act? Tell that to people who lived through WWII, total economic deprivation, and loss of confidence in government and now see half their life savings put at risk by a politician they elected to fix the LDP mess.

A 1.7% savings switch draws 1000 tonnes off the world market; a 17% switch draws 10,000 tonnes. The other Asian nations [With Shanghai's Gold Market Up and Running] are poised to join the fray. New York's COMEX has already been eclipsed by the TOCOM.

It's different this time�even without the aggressive hedge funds buying in NY.

Okay. But I still thank you for reviving MY thought of another possibility for our love of gold.

However, I DO understand the type of experiment you were speaking of and we might be. Later, Interstate

test

http://www.contraryinvestor.com/mo.htm
Tackles a subject close to our hearts;foreign capital flows into the US,replete with the usual ominous charts.These numbers are truly astounding,coupled with declining world trade,the days of the gravity defying dollar may soon be waning.

Incredible flows into the corporate bond market,companies have been piling on the debt to retire stock,among other more noble pursuits.Which,of course,is great for options holders but not so great for a company's long term health.

Debt/equity chart is scary,declining profitability and rising rates bodes ill for the new bubble the financial wizards are desperately trying to inflate.

http://www.futuresource.com/news/news.asp?story=i4232139238763397184
Snippit:

-- Concerns about escalating violence in India may have aided gold rally to $300

-- Narrowing silver spreads on Comex similar to tightening lease rates

"You have escalating reprisals within (India). You've got 150,000 million Muslims, 840,000 million Hindus. It's a tinder box," McGhee explained. "If you get domestic violence in India, it will spread to violence between India and Pakistan. Those are two nuke powers facing each other right now."

Black Blade: Hindus and Muslims are escalating the killing this weekend. The situation looks a lot less stable.

http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2002/03/02/world02.xml&sSheet=/news/2002/03/02/ixworld.html[...]
Shops in Tokyo's financial district are reporting gold sales of more than double last year's. Largely because of demand from Japanese, the price of gold rose above $300 an ounce last month for the first time in two years.

At the Gold Shop, close to Tokyo's main railway station, customers can walk in and buy gold bars or, if they prefer, golden statues of Japanese deities. Displays praise the virtues of the metal and its long history.

The atmosphere is one of discretion. None of the customers wants to talk, and staff advise them in private booths, although discussions can be overheard. From one cubicle a man's voice mentions the sum of five million yen, about �25,000.
[...]

kludge: If this keeps up we'll never get back to < $300 an oz delivered.

RE: Japan's timely affinity for AUI once asked Reg Howe in an email how the grip of the paper market could be loosed to set the true and clearing price of the metal in positive motion. The great man (what is it about Massachusetts?) replied; only "massive buying" could do it. A favorite essayist here once remarked; "the (paper) market will fail going straight up or, straight down but fail it will".

No need here to debate the "straight down" dynamic but with Japan in position as they are, I do see how the market could fail soon and in an upward thrust of significant magnitude. Funny how only 1.7% of liquid assets could be categorized as "massive" in this context.

Gold should always have been allowed to find price point equilibrium in sovereign and global monetary affairs. It should not have been painted into a corner where it necessarily competes with fiat currencies. Our handlers once made and continue to make strategic and tactical errors.

Thanks for your comments.

http://news.indiatimes.com/articlesshow.asp?art_id=2604179Reuters article still up overseas:
INDIATIMES NEWS
CEOs shrug off upturn signs
REUTERS�[ SUNDAY, MARCH 03, 2002��1:00:12 AM ]
BOCA RATON, Florida: Wrapping up three days of splendid seclusion, CEOs of many of America's biggest corporations still need convincing that the US economy is firmly on the mend.
"We're all in a quandary. The economists are telling us there is more strength that we feel," CEO Glen Hiner of building materials group Owens Corning said in an interview on Friday. "We'd love to believe what the economists are saying."
Federal Reserve chairman Alan Greenspan, as well as much of Wall Street's corps of economists, say the US economy is either over or very nearly over the year-old recession that has brought layoffs, plant closings and other corporate cutbacks.
Recent statistical evidence, such as a sharp increase in estimates of late 2001 GDP growth and a December jump in construction spending, bolster optimism about the economy returning to expansion.
But the CEOs, meeting privately amid the palms and golf courses of the Boca Raton Resort & Club, sho wed little enthusiasm for stepping-up hiring and investment spending any time soon, according to participants.
New spending on equipment, plants, advertising and research by businesses will largely determine the vigour of any economic recovery, according to Fed officials. Greenspan and many others predict a slow, extended pickup in business activity.
"I think they're all very cautious," Scott McNealy, CEO network computer-maker of Sun Microsystems Inc, said during a break from briefings by Harvard University's president, the US commerce secretary and others.
"I don't see anybody who's running around, going `Whee!� That was there a few years ago, but it�s not there now," he said.
David Komansky, CEO of broker age Merrill Lynch and Co Inc, also reported that his peers at this year's Boca Raton meeting were wary of jumping too soon on business initia tives.
"I think most people agree that the economy statistically is well off the bottom, but yet most are still staying with a wait-and-see kind of attitude," he said. "They're kind of reluctant to make any significant kind of commitments yet and I think there, too, it's a question of them gaining confidence going forward."
John Snow, CEO of CSX Corp, the eastern railroad and transport group, said the meals and briefings on the world's changing workforce and education yielded no sign of en during boardroom pessimism.
"I think people generally feel the worst is over in this recession," he said.
Many CEOs interviewed outside the private events organised by The Business Council, an elite grouping of current and retired CEOs, said the US recession was just another turn in the economic cycle and a chance for big companies to ready for the eventual improvement.
"I don't find any air of discouragement," David Goode, CEO of railroad Norfolk Southern Corp, said. "People are planning carefully for the uptick in the economy. People are making sure their businesses are working well."
The short-term caution among the company leaders was also evident in a survey by The Business Council of 75 sitting CEOs released on Wednesday, showing three-quarters believed the economy was still in recession.
But 77 percent saw the downturn ending this year and about half predicted the recession would be over by June 30.
The US was, "not quite out of the recession yet, but there are some encouraging signs when you look at the fourth quarter figures, particularly sales figures, and the tremendous decrease in inventories that we saw," said Sidney Taurel, CEO of drug maker Eli Lilly and Co.
"Grasping at straws"? Some of these CEO's obviously are, others play dumb.

http://www.cross-currents.net/charts.htmThis guy wallops a few out that you might not see elsewhere.

http://www.contraryinvestor.com/mo.htmAnd this one builds the continuing bear case with well-chosen charts, words, and humor...

Nah! Just some precautions.In the news today we read the U.S. Government is implementing a shadow government in case of a nuclear attack.
Also in the news. The govenment has increased the amount of sensors to detect radioative material around Washington D.C.

Their getting their Ducks in a Row and covering all the Bases.

Gold just Skooting along under the $300.00 level

Slingshot------------<>

http://www.rense.com/general20/thief.htmEchoes of ongoing presidential plutocracy: default, desperation, and currency devaluation! Rense.com
FDR - The Thief Of America's Gold
By Patrick Chkoreff
Strike-The-Root.com
3-1-02
As Franklin D. Roosevelt was inaugurated as president on March 4, 1933, Americans were in a state of panic. Banks were failing every day, and people clamoured by the thousands to withdraw their money. Ordinarily they might have accepted paper money in the form of gold certificates, but people feared that the government might simply resort to printing worthless money to meet the massive withdrawal requests. They didn't want paper. They wanted gold. Furthermore, people who had gold certificates rushed to redeem them for real gold....
�
Now the only people with a claim to gold in the Treasury were foreigners holding dollars. Since he was on such a roll, Roosevelt decided to rip them off too. On January 31, 1934, Roosevelt issued another Executive Order. Here he declared that the dollar was now only 59.06% of its former gold quantum of 23.22 grains. Now the dollar was only worth 13.71 grains of gold.....
�
By burglarizing the rest of the world, Roosevelt made the Great Depression even Greater. It was more Global because he had impoverished millions of foreigners, and it was more Persistent because he had ruined the good credit of the United States.....
�
In his excellent 1935 book Monetary Mischief, George Robinson claims that these gold reserves really did exist. Maybe so, maybe not. Either way, FDR was not honouring the redemption promise. The U.S. was now running a con game, having printed "gold certificates" that in fact could not be redeemed for gold at all.
�
Imagine if e-gold or GoldMoney suddenly began issuing new digital gold grams without having the real gold grams to match them. That would be theft and counterfeiting. Certainly creating even more fictional gold grams would not be the solution to this problem.
�
FDR engaged in theft and counterfeiting as a solution to a problem caused by theft and counterfeiting. A more honest solution would have been to make good on as many gold redemptions as possible, and then begin a massive liquidation of government assets to purchase gold on the open market until all redemptions were made. To avoid the pricing problems of sudden mass liquidations and mass gold purchases, the government might have offered gold bonds to those who would accept them. These bonds would be payable with interest in gold after a fixed time period..... government, but all private debts as well.
�
But that's just it--the government DID default on the redemption of paper currency, and it did bankrupt the country by deepening the depression and spreading it worldwide. Sadly, it did not bankrupt the government, only the indentured servants we like to call "citizens." (Brother, can you spare a dime?)
�
I must emphasize that when the government devalued the dollar and confiscated gold, they WERE defaulting on their redemption obligations. They didn't magically skirt the underlying hard reality just because some politicians signed some pieces of paper.
�
Some have said that FDR was faced with a dire national emergency, and did the only thing he knew how to do with the powers that had been granted to his new office.
�
To that I say: FDR was not granted these powers. He had no more legal authority to do what he did than my immigrant grandfather had. But that never stopped a president from doing anything to consolidate and maintain power. As a betrayer of the Constitution, FDR ranks right up there with Lincoln, LBJ and Nixon.
�
�

http://www.forbes.com/home/2002/03/01/0301cramer.htmlWell....we all knew this was going on but now it's going to be in print. Might we someday see Cramer, Mark Haynes, Maria Bartiromo, David Faber et al at Senate Hearings? I would pay enormous amounts of fiat to see this.

"...In a soon to be released tell-all tale, former Cramer & Company employee Nicholas Maier accuses TheStreet.com's co-founder of using CNBC anchors and his own television appearances to promote stocks that he would promptly sell, making a quick gain on the upswing..."

http://www.thestreet.com/funds/smarter/877147.htmlU G L Y.....

and bound to get uglier.

http://www.utne.com/bMoneyPr.tmpl?command=search&db=dArticle.db&eqheadlinedata=No%20Recourse"...The price of securities deregulation is rapacious financial practices, phony audits and a sham SEC..."

with thanks to felice22 for these 3 links.

http://www.time.com/time/nation/article/0,8599,214064,00.htmlTimes article (above}coming out tomorrow plus also check out Washington Post article http://www.washingtonpost.com/wp-dyn/articles/A29406-2002Mar2.html

Drudge commentaryXXXXX DRUDGE REPORT XXXXX SUN MARCH 03, 2002 09:22:37 ET XXXXX

OCTOBER BULLETIN SAID TERRORISTS THOUGHT TO HAVE 10 KILOTON NUCLEAR WEAPON TO BE SMUGGLED INTO NEW YORK CITY
Sun Mar 03 2002 10:40:24 ET
**TIME MAGAZINE**

New York -- In October, an intelligence alert went out to a small number of government agencies, including the Energy Department's top-secret Nuclear Emergency Search Team, based in Nevada. The report said that terrorists were thought to have obtained a 10-kiloton nuclear weapon from the Russian arsenal, and planned to smuggle it into New York City, a special TIME magazine investigation reveals.

Publishing sources tell the DRUDGE REPORT, the next cover story of TIME will headline: "Can We Stop the Next 9/11?"

The report hits newsstands Monday, March 4th.

MORE

The source: a mercurial agent code-named DRAGONFIRE, who intelligence officials believed was of "undetermined" reliability, TIME reports. But DRAGONFIRE'S claim tracked with a report from a Russian general who believed his forces were missing a 10-kiloton device.

That made the DRAGONFIRE report alarming. So did this: detonated in lower Manhattan, a 10-kiloton bomb would kill some 100,000 civilians and irradiate 700,000 more, flattening everything in a half-mile diameter.

Counterterrorist investigators went on their highest state of alert, TIME reports. "It was brutal," a U.S. official told TIME.

It was also highly classified and closely guarded.

MORE

Under the aegis of the White House's Counterterrorism Security Group, part of the National Security Council, the suspected nuke was kept secret so as not to panic the people of New York. Senior FBI officials were not in the loop. Former mayor Rudolph Giuliani says he was never told about the threat. In the end, the investigators found nothing, and concluded that DRAGONFIRE'S information was false. But few of them slept better.

Counterterrorism experts and government officials interviewed by TIME say that for all the relative calm since Sept. 11, America's luck will probably run out again, sooner or later. "It's going to be worse, and a lot of people are going to die," warns one U.S. counterterrorism official. "I don't think there's a damn thing we're going to be able to do about it."

The DRUDGE REPORT has been briefed on other revelations coming from TIME's investigation:


The Coast Guard is arming itself against a possible terrorist attempt to destroy a major U.S. coastal city by detonating a tanker loaded with liquified natural gas.


The Administration has recalled old CIA hands with experience in Central Asia. Says an Administration official: "You ended up going back to retirees because the bench was so light on Afghanistan. We're still trying to get up to speed."


This week, Tom Ridge's office plans to announce a new color-coded alert system to warn local law enforcement and the public about threats within U.S. borders, sources tell TIME.


While there is a genuine debate inside the government about whether Osama bin Laden is still alive, there is far less argument about what will happen after Washington is able to confirm that he is dead. A U.S. official told TIME last week that it is widely presumed that al-Qaeda sleeper cells will take retaliatory action once the terrorist leader is killed or proven dead.


"We're as vulnerable today as we were on 9/10 or 9/12," says presidential counselor Karen Hughes. "We just know more."

Developing...

-----------------------------------------------------------
Filed By Matt Drudge

Some here may remember that he was fired from FOX for touting stocks that he owned. He was under contract and he violated te terms by recommending shares of companies that he had an interest in without making any disclosure. It appears that he may be up to his old tricks again.

- Black Blade

http://in.biz.yahoo.com/020214/26/1gfkv.html
Snippit:

The US is the second largest consumer of gold, but its total consumption is lower than 50 per cent of the Indian consumption. The popularity of gold as a tool for investment is increasing due to the global recession, especially in countries like Japan. This is the main reason for the spurt in gold prices in almost all major markets. But this would not destabilise the demand for the yellow metal, Sivaram said.

Black Blade: The WGC is promoting hallmarked machine made 22K Gold jewelry. This may be a good thing as the Indians have been ripped of by local jewelers with lower than stated Gold grades. Marriage season begins this month.

http://biz.yahoo.com/rb/020303/business_column_profile_dc_2.htmlThis guy's schtick is astrology with a twist of financial savvy or visa-versa

snippet;
``The only fundamentals I look at are P-E (price to earnings) ratios, and I keep a lot of technical indicators,'' he told Reuters from his Tucson, Arizona, home. ``But when the market is not following technical priorities, I immediately look at the sky.''

By many accounts, the 60-year-old Crawford, who has published his monthly ``Crawford Perspectives'' newsletter since 1977 and runs a hotline for stock tips, is the best of the bunch. After all, he is credited with prescient calls like forecasting the October 1987 crash.

Don't laugh! That 1987 call was partly pegged to a rare stellar formation the savant saw: the sun, moon, Mercury, Venus and Mars clustered tightly. To astrologically-savvy civilizations like the ancient Mayans it spelled trouble. Crawford promptly warned the sky would fall over Wall Street.

Ditto for his inspiration for another accurate call, the current bear market. That came from a huge planetary alignment in May 2000: Saturn opposite Pluto. This pointed to a decline in economic activity and Crawford warned his readers ``a Bloody Bear Market will be evident'' six to 18 months forward.

``The astrological stuff that I do is all statistical, it is as scientific as any non-astrological work that I do,'' Crawford said in the Southern drawl of his North Carolina roots.

DELIVER IT TO MY HOME, PLEASE

The bulk of Crawford's advice is ``market timing'' -- when to be in or out of stock, bond and commodity markets and identifying major turning points based on technical indicators.

Crawford also has made good calls on individual stock picks. He recommended investors buy into gold mining stocks such as Newmont Mining (NYSE:NEM - news) in April 2001 -- the stock rose from about $16 to nearly $24. The pundit is bullish on the shiny metal itself, believing its long-term bearish cycles have turned and will be up for years.

Top rated financial publication Barron's has called this stargazer the ``Best astrologer on Wall Street'' and Kiplinger's Personal Finance magazine has raved about his track record. Timer Digest magazine, which tracks scores of market timers, named him the 1992 Long Term Timer of the Year and put him on its June 2001 cover.

``He has not beaten the market but there was a five-year period when he was one of the better (market) timers,'' said Mark Hulbert, publisher of Hulbert Financial Digest, which tracks newsletters and has eyed Crawford's work for more than 12 years.

Some 2,000 people, including top Wall Street hedge fund managers, subscribe to Crawford's $250 a year newsletter. The astrology bit is why many subscribers prefer to receive it at home, not the office.

``They don't want people to know that they take the newsletter because of the esoterica,'' Crawford laughed. ``They don't want people to think they are some kind of nut cases.''

Boilermaker;
I like his style and message.

Or is it only Kebble-istic?

DURBAN ROODEPOORT DEEP - JOHANNESBURG
Gold boss barred from S. Africa
Mark Wellesley-Wood, the UK-born chairman and chief executive of Durban Roodepoort Deep, has been refused re-entry to South Africa ahead of litigation against former business associates, JCI Gold and Consolidated African Mines.

Whatever it is, knowing M.W-W. it must be more. A shadow of Zimbawe crossing over the sun of the socialist government may also foretell the fate of SA - in the end.

Very disturbing - though the cabal (if there is one - or two) will it find most distressing, when the largest producer is in disarry. Or will this be the final excuse to paper over the dirty game?

As much as i'd like to show my allegiance to Durban, Goldfields and Harmony - I'm rather leaving this country for good, and go physical (almost) only - (Hello Belgian), took me awhile, though got more to go.

Mesmerized, seeing through? cb2

Do you have a URL for that, or source? Thanks in advance,
Waverider

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256B71005D6400?OpenDocumentSee link for the entire article. Cheers,
Waverider

http://www.msnbc.com/news/717731.asp?cp1=1
Snippit:

THE WALL STREET JOURNAL

SAN DIEGO, March 1 - Surya P. "Pat" Patangay is a financial criminal. He says he had an unwitting accomplice: accounting firm Ernst & Young LLP. As owner of Sonali Corp., a small gold-jewelry seller in Oceanside, Calif., Mr. Patangay defrauded Wells Fargo & Co. out of $14.5 million during the late 1990s.

HE CONCOCTED documents showing his business generated sales of as much as $70 million annually-while actual revenue never surpassed $1.5 million. He stuffed vaults and safe-deposit boxes with more than 12,000 feet of fake gold chain to fool auditors. He rented postal boxes nationwide to create a phantom network of clients.


Black Blade: Yeah, another auditor is in the hot seat.

http://www.economist.co.uk/agenda/displayStory.cfm?story_id=1019589
From The Economist Global Agenda

Snippit:

As more evidence emerges that America's economic recovery may have started, hopes are rising that the worst may also be over for the world economy. But it may still be too soon to uncork the champagne

Black Blade: Though media talking heads and Wall Street pimps along with Alan Greenspin are claiming that the recession is over, we still await evidence. There is still the "minor" problem of corporate profits. There are none. At the meeting of the nation's CEO's in Boca Raton, Florida, there was even less optimism. In fact the CEO's were rather pessimistic citing that there are no plans for expanding capital expenditures. That does not bode well for the economy. "Is this a stealth recovery?" Meanwhile the "Bone Pile" grows ever higher and as benefits expire, out of work workers are no longer counted among the ranks of the unemployed. They may be looking for early retirement or living off of what investments they may have or off of high interest debt credit cards and mortgages. Recovery? Ok, sure - why not. If it makes the pundits happy to live in a fantasy dreamland.

Mon! You're right on!

I'm ready to party -
as I feel the recession
wasn't really on!

You've got to give the boyz some credit
as you know they won't see any debit!

... accumulating debt all along,
destroying any productive nation,
by future's expectation.

Or is it wanton speculation,
hedging the FRN's future -
by manipulation?

OK, let's party, Mon
as long as we can
service the 5% debt
over our income.

... and many thanks, Mon
for all your great posts
and please have 'em come
't won't bother, hey brother,
the hosts, Mon.

Thanks and take care BB - cb2

PS: Won't have to re-direct you to Dr. Kurt R.?
BTW - No(r)Way - I knew it!

GATA dispatches about South Africa's expulsion of
Durban Roodeport Deep CEO Mark Wellesley-Wood:

http://groups.yahoo.com/group/gata/message/1032

http://groups.yahoo.com/group/gata/message/1034



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

gata-subscribe@yahoogroups.com

indication of what's going on here....dirty politics.

Regardless...

This might provide an excellent chance to load up cheap again.

I had dinner at one of my brothers's tonight and we discussed the comments from the CEO meeting....he completely concurred and then some!

My brother is one of the top execs in one of the top Cos involved in insurance ...finance etc

He says they see no recovery ...and in fact weakening. People in his Co are wondering who is on the next pink slip list. Surprisingly the place they are making any money is Japan where ther are deals to take over and run various concerns with no liabilities...the Japanese just want out.

I have never seen my brother as concerned...and believe me...he is in a position to know what's what with many of the Big Boys

With thanks I join the lurkers who are compelled to post in order to learn. My gratitude goes to all who take the time at this site to advance the thirst for knowledge of our complex world. I am especially thankful for the tremendous effort of Black Blade. My question: Forgive me if I have missed the answer, but are any commodities or equities, other than gold, confined to reduced trading hours post 9/11? If the reduced trading hours have a negative impact, are there plans for changes?

Snip
Picture
Snip
Corporate failure: Sato Kogyo president Hiroshi Yoshida bows at the end of a news conference in Tokyo after the Japanese builder filed for court protection in Tokyo District Court yesterday. Analysts say financial markets could take the failure as a sign of progress towards consolidating Japan's long bloated and coddled construction industry. Associated Press
===
Could the financial markets also "take this as something being rotten in Denmark" ?
NAW !!
<;-)

As to be expected DRD (on Aust ASX) is down 3.8% on quite high turnover(30.2K) for the stock here, considering its a public holiday in Western australia.

Having read all of the links re the story about DRD's MD being barred from re-entering the country I can only conclude that Mark Wellesley-Wood is a dead set Wanker!

This arrogant Pom should have had his paper work in order-its as simple as that. He should have had a business work permit-no question. As a DRD shareholder with a significant shareholding I can only hope that this Company gets its act together in a proper manner.

Less than a month ago 3 directors of DROOY (including MWW) sold shares in the Company and at a time when the share price was only just holding. This was serious stuff BUT luckily prices shot up from there --obviously without the help of the clowns that run the place. This company has to get its act together --- a lot of gold bugs have supported
this company & exemplary corporate behaviour is expected &
demanded.

http://quote.yahoo.com/m2?u
The Nikkei is rocketing higher by 553 points (over 5%). Happy days are here again. No more worries. Ignorance is bliss. Then again it could all be the Japanese PPT at it again with a fresh infusion of cash and worried Japanese buying anything ahead of April Fools day.

Whew! They had me going for a minute there.
Was it 15 Billion yen they allocated to buy stocks?...or maybe it was 15 trillion yen.

Who's counting anyway...except for the remeining whipped puppies at Moody's and S&P.

Oh yeah...one can bet the 60s and 70s crowd in Japan is counting THEIR yen and not falling for the NKK225 head fake.

http://quote.yahoo.com/m2?uTaiwan, Japan, Singapore, and South Korea all up over 3% at this time, with Hong Kong up almost 2%.

Is it real, or is it Memorex?

http://groups.yahoo.com/group/gata/message/1035South Africa Business Report's story on the
expulsion of Durban Roodeport Deep CEO Mark
Wellesley-Wood:

http://groups.yahoo.com/group/gata/message/1035


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

gata-subscribe@yahoogroups.com

http://216.46.231.211/credit.htmNot sure I've got a fully-formed thought here, but the economy showing better stats due to money-pumping (of various types) is not necessarily the bear case for gold.

Gold rides on the two wings of inflation (prices up -- protect your purchasing power) and default (accounts at institutions lost in system seize-up). The middle ground -- stable, low inflationary growth -- is when gold rests.

Our case is that the middle ground has been squeezed down to a sliver, and that _structural_ imbalances are now built into, well, the balance sheets of the most important institutions. Whether the stats veer one way or another now is less relevant than whether they can steer down the middle to some soft landings in important sectors of finance.

Perhaps if all the counterparties could agree to something like 20% haircuts and start over in place, we would be spared the worst default scenario, with a payments system lockup. This is what AG must be trying to structure, and as such, he ought to be in touch (or basically backing up) the credit risk insurers like MBIA and AIG, and having backroom consultations with the rating agencies like S&P and Moody's, before they downgrade a JPM or two.

However in doing this he has to guarantee a boatload of liquidity and in the cases where it is firehosed onto a "situation" can he restrain its leakage into other markets? The signal of excess cash through the system builds pressure on eventual dollar devaluing vs gold.

These are games that might be played only with fiat -- as AG said last week it's still an experiment in process -- and with the greatest belief and faith in it by a prosperous population ever, he's got all the running room any central banker's ever gonna have.

In the greatest musical chairs game ever, the chairs are not being removed so much as morphed into "virtual" chairs, and everyone is still dancing busily around the remaining images of those same chairs. The question is whether some less trusting players (big ones) know that the "virtual" game is for the mass of suckers only and are putting their physical butts on some real chairs while they still can.

http://www.usagold.com/cpm/abcs.html

The ABCs of Gold Investing

"Without waxing philosophical, a few words are helpful concerning the mind-set with which you pursue your interest in gold ownership. Some enter the gold market to make a profit, others to hedge disaster, some to accomplish both. No matter into which category you fit, make sure you understand why you are going into the gold market. Convey that understanding to the individual with whom you are structuring your gold portfolio. The whys have quite a bit to do with what you end up owning.

"Frequently investors will say that any kind of gold will do because after all gold is gold, isn't it? This type of attitude has helped a great many coin shop owners unload unwanted inventory they hadn't been able to get rid of for years. This is probably a good deal for the coin dealer, but it could spell disaster for you. In the same vein, I have talked to hundreds, probably thousands, of investors in nearly a quarter century in the business. Quite often, potential investors have no more reason for buying gold than 'everybody else is doing it.'

"In Chapter 16 on portfolio planning, you will find some details on this important subject. For now, consider the inscription over the entrance to the temple of the ancient Delphic Oracle: 'Know Thyself.' Study. Read. Learn what's going on around you. Call a few gold firms and ask questions. There's nothing like conversation to stimulate thinking. Take time to lay a little groundwork. Then make your move. The political and economic situation being what it is, there is no better time to start than now. Know thyself -- your goals and needs -- and you will be a more confident, happier gold investor." (more)

Please Remember: It is your purchase from USAGOLD / Centennial Precious Metals that nourishes these pages.

http://quote.yahoo.com/m2?u
Nikkei finished at +638 (up nearly 6%). The Nikkei appears to have tugged the rest of the Third world Asian countries markets higher in sympathy. "Interesting Times"

Philip Manduca from Dexia alt.inv. Fund confirmed "strongly" again that Gold is "manipulated" and will revalue strongly during 2002 and 2003 ! Again the intervieuwer tried to ridicule Physical Gold and its Holders. But with very, very little conviction (seemed rather embarresd with his imposed nonsense-mantra) !!!

On the geo-political front, the visit of Eurolander Solana to the US about the situation in the ME, indicates that the Empire is losing allies overthere at a rapid pace. Arabian and Russian oil (included the 50% private oil) will bring POO into the 25$ - 28$ range for geo-political reasons !

CBII: Yes the present small DROOY-event is a small example of what can happen when Governments suddenly turn their attention to underground gold ! Say no more Belgian !

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256B72002F5CF1?OpenDocumentChris Thompson, chair and CEO of South African Gold Fields announced that he is stepping aside for Ian Cockerill, formerly of AngloGold.

From the article:
--------Thompson will continue as non-executive chairman of the board but will relocate to Denver: "The move will allow me to become more effective," he said. The existing combination of the chief executive and chairmanship roles means Thompson is often too caught up in the day-to-day management to give the overall direction of the group appopriate time: "Chris's role will now become more Olympian," Cockerill said.-----------

Denver: America's best place to shop the gold market! Make Centennial your broker; you'll have an inside track in the industry.

Randy

http://quotes.ino.com/exchanges/?c=metalsWhat the hell is this? Gold just popped over the $300 level.

http://www.reuters.com/markets_breaking_news_article.jhtml;jsessionid=5GYLGHB3L1TKOCRBAE0CFEYKEEATGIWD?StoryID=656735&basketId=US_COMKTNEWS&marketId=1

.N225
NIKKEI 225 INDEX

Last Change
11450.22 +638.22


8511.T
JPN SECS FINANCE

Last Change
474.00 +20.00


ANALYSIS-Lift from Japan short-selling rules to be brief
REUTERS:
March 04, 2002 04:25 AM ET
By Risa Maeda

TOKYO, March 4 (Reuters) - Japan tightens its rules on stock short-selling this week, aiming to curb speculative sales ahead of the critical annual book-closing on March 31, but the rushed move threatens to disrupt trading and will do nothing to solve the country's underlying financial problems, analysts said.

Short selling involves selling shares you do not own in the hope of making a profit by buying them back at a lower price.

Tokyo's benchmark stock index, the Nikkei 225 .N225 , jumped 5.9 percent on Monday, extending the surge seen since the rules on short sales were included in the government's anti-deflation package on February 27.

Analysts generally doubted whether that effect would linger much after Wednesday, when the rules are implemented.

"Regulations do not change the world. Once short-covering is over, that's it for the market," said Masatoshi Kikuchi, senior strategist at Merrill Lynch in Tokyo.

Short-selling, particularly by foreign hedge funds, has been blamed for a sharp fall in the Japanese banking sector and wild fluctuations in Tokyo share prices in general in recent months.

Japanese banks now have to value their huge stockholdings at market prices. Most of the big banks are already forecasting net losses this financial year and the authorities are worried that weak shares will further undermine their financial solidity.

Currently, operators who borrow stocks to sell short are barred from selling below the most recently traded price.

From Wednesday, Japan's financial watchdog, the Financial Services Agency (FSA), will also ban short selling at that price. Henceforth, short-selling will only be allowed at a price higher than the most recently traded price.

Some analysts saw little inconvenience.

"The new rule is not particularly onerous. All it is doing is introducing the same rule in Japan as has existed in the United States since 1931, which is the 'uptick rule'," said Garry Evans, strategist at HSBC Securities



Another sucker rally..Has this aspect been topic for discussion /posting or did I miss it? This time Gold is speaking very loudly ...to see GOLD climb along with the Asian Equities markets is more like a harbinger of what is to unfold..stay tuned here at USA GOLD......

http://biz.yahoo.com/rf/020304/l04161054_1.html
Snippit:

LONDON, March 4 (Reuters) - Platinum prices leapt to a seven-month high at the morning fix in London on Monday, as investors caught short by the Nikkei's strong rebound in Asia overnight struggled to cover their positions, traders said.

Platinum prices leapt over $20 at the fix to record their highest level since July 2001, after yen-based platinum futures had surged on Monday on TOCOM as spooked investors holding short positions rushed to cover as Tokyo stocks soared and the yen firmed.

Prices snapped up to fix at $512 an ounce, up from $488 on Friday afternoon. The last time prices topped $500 an ounce, was back in July 2001, when prices hit $504. ``The Nikkei went up and caught a few people short this morning. It's run into resistance here, but I think it has the potential to run away now it has cleared $500,'' a trader said.

Black Blade: The Japanese are hot on both Gold and Platinum. This suddenly explosive rise on the Nikkei over the last few trading sessions is surprising in that Japan's underlying economic problems (in particular the insolvent banks) have not been addressed. Also, I would be interested to see if Russia is making deliveries. They had depleted their stockpiles of PGMs in 1998. "Interesting Times"

http://www.trendmacro.com/a/luskin/20020301luskin.asp
Friday, March 1, 2002
Donald Luskin : The Greenspan Gadfly

---The Fed's chief congressional critic may be a little off the wall, but he's asking some interesting questions.---

http://www.mips1.net/mgldn.nsf/Current/8525690B0032142042256B71005BAE27?OpenDocument"mentioned that a prominent ---politician---(sounds
familar? Knallgold) had written a proposal suggesting Germany should sell a substantial chunk of its gold reserves...The whole move is Eine Kleine Nachtmusik to the conspiracy theorists' ears. .."

http://www.jse.co.za/Hopefully this post does not violate forum rules about stock dicussion but the news on Durban has broader implications for SA investment in general.

I've been watching Durban Deep (DUR) on the JSE today and its holding firm and a little up at 3070 SAR. Only a little over 100K shares traded with a 30min time delay on the quote. Perhaps this fuss over their CEO is seen as a tempest in a teapot by the South Africans.

Any other reaction been seen?

I just seen on the MSNBC website were more of our soldiers
were killed in Afganistan.
I think that if we see this every day it will wear on the stock market will wait and see today. May look for gold pop to, can't wait for the UK's last auction. :) truthcaster

Story Filed: Sunday, March 03, 2002 11:19 PM EST

SURMAD, Afghanistan (AP) -- U.S. bombers pounded al-Qaida and Taliban positions in the eastern mountains of Afghanistan and allied forces clashed with the
well-armed fighters as a major U.S.-led offensive raged for second day Sunday.

U.S. and Afghan forces backed by the airstrikes engaged in ``heavy'' fighting against ``several hundred'' opposition fighters, said Maj. Ralph Mills, spokesman for
U.S. Central Command in Tampa, Florida.

Mills said that U.S. strike aircraft, bombers and AC-130 gunships were targeting enemy vehicles, mortars, troops and caves. He would not estimate how much
longer the fighting would go on.

Overnight and into Monday morning, U.S. aircraft carpet bombed the Shah-e-Kot mountain range of eastern Paktia province, where Taliban and al-Qaida forces
are believed to be hiding out in caves.

U.S. Chinook helicopters ferried in supplies to American and other troops in the hills following the start Saturday of a 1,500-strong coalition ground attack in the
area.

One American soldier and three Afghan fighters were killed Saturday, the Pentagon said. Six Americans were injured and airlifted out, a doctor at Gardez hospital
said.

The assault, which began with bombing raids late Friday, was believed to be the largest joint U.S.-Afghan military operation of the 5-month-old terrorism war.
Pro-U.S. Afghan troops approached the hide-outs from three directions to isolate the fighters and prevent them from escaping.

Afghan troops warned the operation was far from over.

``You can't do everything in one operation,'' said Raza Khan, an Afghan fighter recovering from Saturday's battle at the hospital in the provincial capital, Gardez.
``This is Afghanistan. This is a guerrilla war.''

Leaflets dropped by U.S. aircraft on the arid plains of the province urged residents to cooperate: ``Hand over Taliban and al-Qaida or you will be destroyed.
Come forward with information about Taliban and al-Qaida,'' read the leaflets, written in Afghanistan's two most common languages, Pashtu and Dari.

Sunday's airstrikes repeatedly pounded targets in the Shah-e-Kot mountains 20 miles east of Surmad and the Kharwar range to the west in Logar province.

The bombardments, which continued Monday, sent thick, black plumes of smoke above the snowcapped peaks and shook the ground in Surmad, where a
constant stream of bombers streaked overhead.

``In one minute I counted 15 bombs,'' Rehmahe Shah, a security guard at the intelligence unit in the provincial capital Gardez, said Monday.

One Afghan commander, Abdul Matin Hassan Kheil, said his men came under fire Sunday from mortars, heavy artillery and rockets fired from al-Qaida positions
where Arabs, Chechens and Pakistanis were believed holed up.

``You can see it is a big operation,'' said Kheil, who led 50 fighters at a front-line position. He said coalition forces were dug in about one mile from al-Qaida
bases in the Shah-e-Kot mountains.

At least three Chinook helicopters, which zoomed toward the mountains Sunday afternoon flanked by two jets, were supplying ammunition and food to American
forces still in the hills, he said.

Kheil estimated it would take a month to push the fighters from their mountain strongholds.

Saturday's ground attack, carried out in snow-covered mountains ranging from 8,300 feet to 11,600 feet above sea level, appeared to have made little headway in
dislodging Taliban and al-Qaida fighters who are regrouping in the hills of eastern Afghanistan.

``Firefights have been intense at times in heavy combat action,'' Maj. A.C. Roper, spokesman of the 101st Army division in southern Kandahar, told reporters
Sunday.

A U.S.-led force of 1,500 Afghan allies, U.S. Special Forces and troops from the Army's 101st Airborne assault troops had assembled for the battle, a U.S.
defense official said.

Central Command said that coalition partners participating in the operation include Denmark, France, Germany, Norway, Australia and Canada, although it was
not clear if all those countries were operating on the ground.

The Afghan allies made up the bulk of the force and approached the front from three different directions, some of them using pickup trucks rented for $200 from
the Gardez bazaar, Afghans said.

About 600 fighters accompanied by at least 40 U.S. soldiers approached from Gardez, north of Surmad, said Safi Ullah, a member of the Gardez town council,
or shura. Another 400 Afghans came in from Khost to the east, and an undisclosed number came from Paktika province to the south.

At least 70 vehicles carrying American and Afghan forces snaked around the back road behind Surmad to reach the front, said schoolteacher Rehmatullah, who
uses only one name.

A Surmad village elder, who identified himself only as Mohammed, stroked his unkempt, red, henna-streaked beard and pointed toward a mountain beyond a
stand of trees near the Shah-e-Kot range where the offensive was launched.

After the ground attack stalled, U.S. planes late Saturday dropped newly developed bombs designed to send suffocating blasts through cave complexes, military
officials said. The ``thermobaric'' bombs were tested in December and officials said in January that they would be rushed to the region for the war.

Afghan fighters recovering Sunday at Gardez hospital described the operation as two-pronged, with one group of Afghan troops and U.S. Special Forces
launching a frontal attack on the mountains and a second attempting to ambush from the rear.

Fighter Raza Khan said the American was killed when a pickup truck he was riding in was hit by a mortar shell.

Six injured Americans were airlifted out of the area by helicopter, said a doctor at Gardez hospital, Najibullah. Surmad residents said helicopters had gone into the
mountains amid heavy firing Saturday.

The first stage of the offensive was designed to cut the road from Shah-e-Kot to trap al-Qaida and Taliban forces in the mountains, said Safi Ullah of Gardez. He
said the plan also involved setting up checkpoints in the area to prevent them from escaping.

Pakistan closed its border to block fleeing al-Qaida or Taliban members and deployed extra army units and members of the Khasadar tribal militia to catch any
who try to cross the frontier.

The rugged, caved mountains around Gardez have been a hiding place for Afghan warriors since anti-Soviet guerrillas used them as a base for their fight against
Soviet troops in the 1980s.

Afghan officials say as many as 4,000 al-Qaida and Taliban fighters are regrouping in eastern Afghanistan and just over the border in Pakistan, urging the faithful to
wage holy war against U.S. forces.

Neither the former Taliban supreme leader Mullah Mohammed Omar nor al-Qaida chief Osama bin Laden is believed to be in the area.

Copyright � 2002 Associated Press Information Services, all rights reserved.

http://www.morganstanley.com/GEFdata/digests/20020304-mon.html#anchor0
Global: The Heavy Lifting of Global Decoupling
Stephen Roach (New York)


The global economy remains locked in a US-centric mindset. With America now flashing early signs of cyclical recovery, the world at large is starting to breathe a collective sigh of relief. And why shouldn't it? The great global growth engine finally appears to be back on the tracks. Is the world economy about to reap the fruits of yet another US-led upturn?

Our "global decoupling" thesis argues to the contrary -- that the world will find it exceedingly difficult to stay the course of the US-centric growth paradigm that has been in place for most of the past decade. This outcome hinges on a US economy that is now facing an unsustainable external imbalance -- an economic recovery that begins with America saddled with a current-account deficit of about 4% of nominal GDP. Never in recorded history has the world's growth engine attempted to jump-start the global economy with such a massive balance-of-payments deficit. Indeed, the real risk is that this imbalance could get considerably worse if the world stays this course -- with the US current-account deficit rising to 6% in 2003, and considerably higher in the years beyond. That's the precisely the macro tension that global decoupling addresses. Such an extraordinary imbalance in the global economy is simply not sustainable. It could well give way either to slower US economic growth or faster growth elsewhere in the world -- or a combination of both.

++++++++++++++++++

The good Mr. Roach has yet to realize that the the bear's grail is also made of gold...but he's coming around.

http://www.usagold.com/ProductsPage.html

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"These are treacherous times for investors." The Bank Credit Analyst

"The Treasury, the Federal Reserve and Congress have all taken a wrong turn together when it comes to the economy, and the people of the United States will have to pay the penalty." Adrian van Eck, The Money-Forecast Letter

http://www.investavenue.com/article.html?ID=4221By Douglas C. Noland from Prudent Bear Mutual

---ANY READER OF THESE SPORADIC MIISSIVES IS PROBABLY READY TO DISMISS THE INVEIGHINGS AGAINST IDERIVATIVES WHICH (WITH THE EXCEPTION OF THE LTCM DEBACLE) HAVE BEEN "CRYING WOLF" TO DATE! AS WITH ANY OTHER PREMATURE CONCERN, THERE IS ALWAYS THE CHANCE IT'S TIME MAY COME. WE THINK THAT TIME IS APPROACHING. THE BULK OF THE MORE THAN $100 TRILLION IN THESE INSTRUMENTS IS CONCENTRATED IN LITTLE MORE THAN A COUPLE OF HANDFULLS OF GIANT FINANCIAL ENTERPRISES. A SURPRISINGLY LARGE PERCENTAGE IN ONE!

J.P.MORGAN/CHASE IS AFFECTIONATLEY KNOWN TO SOME AS THE "DERIVATIVE KING" HAVING BEEN THE RESULT OF A MERGER OF A COUPLE OF THE BIGGEST PLAYERS. THEY ARE AN ACCIDENT IN WAITING. THE RATING AGENCIES ARE BETWEEN THE PROVERBIAL ROCK AND HARD PLACE! THIS IS NOT NOW A COMPANY DESERVING AA RATING. NEITHER CAPITAL NOR EARNINGS PLACE IT IN THAT CATEGORY. PROSPECTIVELY IT CAN ONLY GET WORSE. ON THE OTHER HAND, ANY DOWNGRADE WILL BE AS BAD AS LTCM FOR THE MARKETS. THE LITTLE KNOWN SECRET IN THIS GAME IS NETTING. IT IS POSSIBLE TO HAVE A HUMONGOUS GROSS EXPOSURE TO MORGAN IF YOU HAVE OFFSET WITH HUMONGOUS "DYNAMIC HEDGING". ALL OF THIS STUFF IS ONLY IN FOOTNOTES BUT GROSS EXPOSURES FOR A NUMBER OF THE OTHER GIANTS ARE IN VERY BIG NUMBERS! A DOWNGRADE IS GOING TO FORCE THEM OUT OF NETTING INTO EXPOSURE!

After Enron, they can't take the chance of having it come out with the wrong spin!

Among others, Citi, Morgan Stanley, Goldman, AIG, Merrill and GECC are likely very large netting counterparties. A downgrade, which looks increasingly likely, will force interesting disclosures there. Other counterparties will be the beleaguered Japanese banks and the large British, Dutch, German and, to a lesser extent, other continental banks. If the safety and secrecy of netting begins to unravel, this could be quite a story. They may, with the aid of the Fed, be able to again sweep this under the rug but we doubt it. ----

Spartacus:Dynamic hedging? Interesting...

http://www.depression2.tv/bio.html

Spartacus, that link to "The Greenspan Gadfly" led to a good read and provides a link to Mr. Greenspan's Testimony. Here is a further transcript of the exchange during Q&A after the testimony. It was previously posted by Michael Nystrom, editor of "Depression2.tv" and "Stock Market Chronicles."

Following is a transcript of the [Ron Pual/Alan Greenspan] exchange:

"Chairman, if we get to this point (of the collapse of the dollar), which I suspect we will someday, I ask that we have hearings to debate the issue of what medium exhange we will have before the Fed starts using oxen as a medium of exchange...

"I feel that it is an important point, and I want to relate that to the Enron issue. In many ways I feel that the system you have been asked to manage is similar to being asked to manage an Enron system. Because Congress is notoriously in favor of deficit spending. We are currently expanding the national debt at $250 billion per year, and we have nearly a $6 trillion debt*. Now we create that debt by buying votes. We spend alot of money.

"Now, the Federal Reserve comes in and they buy that debt in order to maintain the interest rate that they think is the right interest rate. And they take that and use it as an asset. You put it in the bank, you call this debt that we created an asset, and you use it as collateral for our Federal Reserve Notes.

"So that's a pretty good scheme, and I think in the moral terms, as well as the economic terms, it is very similar to how Enron operates. I'm not convinced that this system works very well because alot of people here praise you for the adequate amount of liqidity, and that's what inflation is - you create more money, lower interest rates. Every time you ask for liquidity, every time you ask for lower interest rates, you're asking for inflation of the money supply. And I think what we fail to ever do is ask about the cost.

"Do we ever concern ourselves about the people who have had 2/3 of their income removed because they happen to be savers, and living off interest? We gouge them with interest, inflation, a loss of purchasing power, as well as taxing that. And a lot of people in this country have suffered from that particular system.

"Now the analogy that I would like to draw is something that you said in your testimony on page 13. And you have mentioned several times now that Enron may be a good lesson. And I think it is. And I'm not for more of this regulation by the SEC. I think you're correct that derivatives provide a market tool that is worthwhile. But you said the Enron decline is the effective illustration of the vulnerability of a firm who's market value largely rests on capitalized reputation, with very little if no physical assets.

"That's exactly what our monetary system is all about. And that's why I believe that the dollar is vulnerable. We in Congress do not have a responsibility to run Enron. Some other government has the responsibility to deal with fraud. We have a responsibility to the dollar. And I think that's what we fail so often to address around here.

"And you said that Enron provides the encouragement that the force of market discipline can be counted on over time to foster a much greater transparency. That's exactly what the market does with money. If you look at the rapid and sudden devaluations of the fiat currencies around the world, if you look at what happened to us in '79 and '80, that was the market coming in and enforcing vulnerability & transparency on us.

"Now, gold gives you a hint as to what's happening. Gold has sent a mild message in this past year, in spite of the fact that central banks and other continually sell and loan out gold to push the price of gold down. But there is a message there.

"So I would ask you, can you see any correlation between what you're asked to do in running our monetary system to that which Enron was involved in?"


Greenspan's response:

"I hope there are fundamental differences.....er...ar...I mean there are� ...it's ....ah,.. first, dealing with a fiat currency, what it essentially is that we are doing is that the currency is granted value by fiat of the sovereign, as it is said in the text books. The issue there is that..uh...in years past..uh..there have been, there's been considerable evidence.. that fiat currencies have been mismanaged in general and that inflation has been too often the result.

"What I was mentioning in the speech that you were referring to was the fact that there is some evidence that we're learning that lesson�learning how to manage fiat currency..ah...ah...I've always had some considerable skepticism about whether that in a long run can succeed, but I must say to you the evidence..errr...of recent decades is that it has been succeeding. Whether that continues is a forecast which I can't really ...er....project on.

"The Enron situation is essentially one in which..ah..there was an endeavor to imply that earnings were much greater than they really were. That increasing debt was hidden. I can think of no reason to have done what they did with their off-balance sheet transactions, other than to obscure the extent of the debt that they had, and what was essentially squandered in that process was the reputational capital, which they had succeeded in achieving over a period of time...and I don't perceive that �er�.that anything that we are doing as a central bank..ah.. involves anything related to that..I hope that �.uh�where we need to be transparent and indicate what we are doing, we do so and we do so except in those areas where it - as I mentioned to you previously- ah�inhibits the ability to actually function as a central bank. But as I say in summary I hope your analogy is inappropriate."

Paul's last word:

"I'll keep hoping."

**

http://www.nationalpost.com/financialpost/story.html?f=/stories/20020304/225997.html
Discounts, low rates likely to persist

Snippit:

North America has turned into one giant bargain bin, a fact that clearly haunts the dark corners of Alan Greenspan's mind as he casts his critical eye over an increasingly upbeat economic recovery.

Bargain basement prices may have saved the United States and Canada from recession but they will continue to crimp corporate profit and hang like a shadow over balance sheets loaded with debt.

Black Blade: The last few trading sessions on Wall Street have been amazing in face of no real supporting data. What phantom improvements to the GDP are due to lower oil and zero percent financing that yields very little if any to the corporate bottom line. Should get "interesting" over the next few days.

You see how much people want to believe. The market will eventually lighten their liquidity IMHO.

At least we're near $300 day before auction. What will transpire? How long will gold be 'pinned'? How long will it take before wary investors flood PM market? I keep waiting for one of those famed spikes most of you speak of, fifty dollar overnight jumps etc... I've not been studying PM's long enough to see a great spike. Is it possible that it could still happen? Or are too many people watching PM's too closely? Watched pot never boils?

"Heeeeeere spikey spikey!"

Hi Spartacus,do you know which big banks in uk,germany and holland will be in trouble?Are we talking total closure or loss of profits?I have some accounts in these countries.

The Energy Time Bomb

The US is despised by many nations around the globe. The very existence of the US depends on some of these nations. In particular, the US depends on the willingness of the Middle-Eastern nations to sell oil to the west. Without Middle-Eastern oil the western economies die. It is simple as that. US policy in the Middle East has created a crisis with increasing Arab rage toward the US.

Recently energy prices have fallen and reserves appear to be adequate. This has lead political and business leaders to become complacent. However, lurking beneath the surface lies a bubbling energy crisis in the making. Even though the economy is believed to be on the mend, it simply cannot grow without an abundant source of "Cheap Energy". What happens if and when the Middle Eastern OPEC members decide to turn off the spigots? What if the Russians and former Soviet Union republics (many that are under Fundamental Muslim influences) decide to hold the US hostage? The answer is simple - it is either war or Global Economic Depression.

Warm weather along with reduced demand for energy due to economic recession has lulled the American consumer-investor into a state of complacency. We are setting ourselves up for one of the most devastating energy crises in history. Oil, natural gas, and electricity prices will rise much higher. The problem will be extremely intense if the US is truly in an economic recovery.

I have mentioned many of these points before. Even now there is a rising global demand for energy. Emerging Third World nations like China, India, and regions like Latin America and Africa are demanding their "fair share" of dwindling energy resources. If the Global Economy is emerging from recession, then that economic recovery will be short-lived unless a serious global effort begins immediately to explore for and produce sufficient hydrocarbons.

Even with the economic recession is force, we see that increased demand for Internet and high tech gadgets are placing an extreme drain on the decaying energy grid. The construction of web server farms continues. Each web "server farm" uses the equivalent electricity of eight 40-story buildings. This has placed an unsustainable strain on the aging US energy grid.

During the last energy crisis, there were plans for over 300 new NG-fired power plants. Those plans have been shelved due to lower energy prices. This will constrain economic growth, let alone any economic recovery. The EIA has stated that the US will need at least 40% more energy capacity by 2020. That is an extremely conservative estimate by any measure. We will not likely even come close. In spite of record drilling activity, there has only been a 2% increase in NG production. Now drilling activity has fallen off by over a third.

OPEC has been crucial to the economic survival of the western nations for decades. Saudi owns at least 25% of all the OPEC oil and that regime is looking less stable all the time. It was Saudi that provided most of the terrorists that flew loaded passenger airliners into the World Trade Center. Yeah, 15 of the 19 hijackers were Saudis. Why did they do this? Because they despise us, our culture and everything that America stands for. But even more than that, they perceive the US as a supporter of their enemy (Israel) and our continued military presence (infidel presence) in their country.

As the US is the major supplier of arms and supporter of Israel, I would venture a guess that we will see more Arab terrorist activity on US soil and perhaps even an overthrow of the pro-west Saudi Monarchy in time. This could come from the militant strict fundamentalist Wahabi influence that controls the education and religious teachings in Saudi. The Saudi Monarchy routinely payoff Wahabi clerics to avoid civil war. That may not work much longer as evidenced by the increasing extremism of Osama Bin Laden and his Al Qaeda network. What if Al Qaeda just decided to destroy a major Saudi oil off loading center? The world price of oil would skyrocket and crash the world's economies.

To put this in perspective, the US consumes about 20 million bbl/day, while producing only a mere 5.8 million bbl/day. Although the US buys oil from around the world, if the Saudis alone turned off the tap, the whole of the western economies would plunge into economic depression. We are not an agrarian society anymore. Even if we were, the petroleum industry supplies the fertilizers and pesticides for US farmers.

It's d�j� vu all over again. This is not completely unexpected unless you're brain dead of course. Remember that we've been through this before. In 1973 there was the Arab Oil Embargo in protest of the west's support of Israel during the Middle East war. Saudi was the driving force behind that. There were long lines at the pump and the US economy crashed.

Then in 1979, the Shah of Iran was overthrown and militant Islamic fundamentalists took American embassy personnel and tourists hostage. Not to mention the Russian invasion of Afghanistan and double digit inflation. All these events caused many to fear another disruption of oil supply and consequently the POO rose dramatically, again causing gas lines at the pump and severely crashing the US economy.

Then in 1990, Saddam Hussein invaded Kuwait and again the POO rose higher. The US economy sank. Then last year there was another energy crisis along with rolling blackouts that pushed the US economy into yet another recession. Every postwar recession has been preceded by an energy crisis.

The only choices that the west has left are to become "energy independent" which is impossible of course. The next best thing is to reduce dependence on Middle-East oil. Another point is that energy distribution must be made more efficient. It is time for people to stop whining about NIMBY. This is a national security issue. The energy grid is woefully inadequate for the task. Upgrades, improvements, and new transmission grids are needed as well as more pipelines. We also must develop new alternative energy sources though our options here are severely limited and the costs are very high.

So get ready and prepare. I don't expect to see any meaningful changes anytime soon. We could see an economic recession/depression of epic proportions sooner rather than later. So get out of debt, get cash on hand for several months expenses, get a food and basic goods program started, get Gold and Silver portfolio insurance, and hope for the best.

- Black Blade

Russia knew about the 10 kiloton nuclear weapon

IMHO, I mean think about it. How does Russia all of a sudden come up short on a couple of briefcases containng portable nuclear bombs? ( i can't wait to hear what jay leno says about this one) Russia is pulling a Shilling. I would have to imagine that kind of top secret inventory would have the highest level of security, i mean how many briefcase nukes are we missing? I've heard of company theft but this is ridicules.

I have a gut feeling that Russia sold it to the terrorist (or even gave it to UBL) knowing that it would be used against the USA. It would only benefit the commies for United States to have to deal with a nuke going off in NYC or Washington. Think about how that alone could shift the confidence and world power balance as well as the destruction it would do to our already weakened stock market and economy in general which was one of the terrorist goals from the get go.

And I think the terrorist are going to pull it off, it's probably aready been planned out and waiting execution. I hate sounding like a doomsayer but if i could offer any advice today to my friends sitting here at the table it would be get your house in order because its about to hit the fan!

And like i said i have a gut feeling its just a matter of time before they do it. On a side note i always thought the market hated uncertainty and i cant think of a more uncertain and unstable time as now, what gives? Rock

Dollar/Dow Inverse Relationship? (now what?)Markets roar and dollar drops?! What do you make of it?

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256B720041DBE5
First DROOY CEO Mark Wesley-Wood is banned from SA. Then Executive Director Roger Kebble is banned from DROOY properties. Maybe this whole imigration mess was orchestrated in a possible failed coup for DROOY leadership. "Interesting" Kebble is no stranger to controversy and playing fast and loose with the legalities.

- Black Blade

http://biz.yahoo.com/rf/020301/n01497425_1.htmlU.S. rig count down 10, Canada down 49

Snippit:

NEW YORK, March 1 (Reuters) - The number of rigs searching for oil and gas in the United States fell by 10 to 782 during the week ending March 1, according to oil services firm Baker Hughes (NYSE:BHI). A year ago there were 1151. The number of rigs exploring for oil and gas in Canada was down 49 this week to 361 compared to 540 last year. The total North American rig count fell by 59 to 1,143, while last year it was 1,691.

Black Blade: There will be no "Energy Independence" at this rate. The Middle East oil producers have there foot on our throats.

http://www.financialsense.com/Market/wrapup.htm
Snippits:

Profit Mirage

This nonsense of reporting pro forma numbers is widespread. It is used by companies when they report their earnings and by analysts when they make their projections. This information is widely disseminated by illiterate anchors when they report the results. By emphasizing pro forma results, analysts and anchors are allowing companies to go with any number a company chooses. Companies may now subtract any expense from pro forma earnings they want to ignore to arrive at a profit number that they desire to portray. The result is that we are creating an illusion of profitability that in reality does not exist. What is occurring with the reporting of earnings borders on fraudulent and unfortunately, the practice is so widespread. There are absolutely no checks and balances in the system. Companies report what they want as earnings. Analysts use the bogus numbers in their projections, and network anchors simply parrot the results like automatons without any objective questioning.

Get Ready for Earnings Season

For now this mirage in earnings and the economy continues and is what is driving the market's upswing. I suspect the mirage will continue, heavily supported by analysts and anchors for a while longer. In just a few weeks we will begin the next quarterly reporting season. Companies will be reporting or warning, whichever the case may be, their first quarter results. Everyone knows they are going to be negative, but the question is just how bad. What will be even more important to glean from these reports is what companies are saying about the second quarter and the second half of the year. Wall Street is projecting a pro forma increase in profits beginning in the second quarter. The real bottom line numbers should be negative, which is why they won't be mentioned.


Black Blade: And so it goes. I think that Alan Greenspin alluded to this as "Irrational Exuberance". Also the Japanese markets have been somewhat irrational as the Japanese version of the PPT has been involved in buying up Nikkei 225 index futures and shares ahead of the Japanese banks year-end reporting (this month). The insolvent banks must report the market value of shares they bought at much higher prices. That could be especially damaging, and therefore the big effort to push the Nikkei index higher this month. "Interesting Times"

I picked up Chinese foos for dinner....and of course got a fortune cookie....I'm still laughing...may it be true for us all:


"You will have gold pieces by the bushel"!!!!!!!

I never saw one like that before....maybe the force is with us ...

Oh..and the second one "You are going to have a very comfortable old age"

Hey USAGold...is this a new marketing campaign...pretty neat!!

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020304/ap_on_hi_te/verizon_layoffs_1
Snippit:

For the second year in a row, telecom provider Verizon Communications Inc. is cutting its employment rolls - eliminating the budgetary equivalent of 10,000 jobs.


Black Blade: The "Bone Pile" grows as more "Phone Bones" march off to the unemployment office. No - I see no economic recovery yet.

Words from the past.I thought it fitting on the eve of the BoE auction to draw a line from Shakespeares, Julius Caeser. Would there be any better warning to the cabel than the soothsayers, "Beware the Ides of March". Being the last auction and all the other events in the world could fair well for gold.

It is very quiet on the forum tonight.

We await tomorrow outcome!

Slingshot----------------------------<> CABEL

No one has commented yet upon the fall of the dollar today relative to the rise in US markets the today and yesterday.
There is a definite disconnect between the economy and the stock market. I do see the economy improving slowly and in small ways. I work in the streets of the USA. I do see it everywhere. However, this improvement is completely contrived by credit expansion; it is not lead by savings. I think the worst is yet to come for US markets. DOW:6000/NDQ:1000. Place your bets.

There have been some postings over at the other forum that have gotten me interested in Land Patents.

Has anyone ever gotten one?

Can you get one for gold mines, or mining claims?

The Japanese are pumping billions of yen into their market and the shorts are covering their over extended positions so we se an "Asian Rally". The rest of the hammered investor world sees this as their salvation and jumps on...lemming-like.

The dollar's drop is well within the control range and just doesn't matter any more. There are too many ways to manipulate the dollar. For example suppose that one wants to dissuade the Japanese from selling their treasuries. Well, just your SECTREAS get on a plane and tell them their coupons just went up 3%...5%...or n% so long as they DON'T sell the treasuries. Finance this by expanding the repos pool a little. Who's counting anyway?

The ball to watch is [For tomorrow at least] is the subscription for the BOE gold auction] and the countdown to the Y2K-like Japanese savings insurance cap.

To the uninitiated, this cap seems like reasonable banking prudence. However, it really is an attempt to bail out the insolvent banks by "accessing" the $620 Billion in uninsured deposits.

The government just "Nationalizes" the banks and all is well. Just like that... ten years of dull performing financials are, poof, erased. Replaced with freshly minted, vibrant banks.

Of course the uninsured portion of the elderly Japanese people will not be "Transferred" to the "Nationalized" banks...because, well, it wasn't insured...was it. One can bet the Western financial press will not cover this event any more than they have covered the almost 100% effective tax revolt in Argentina.

If this draconian scenario happens, the Law of Unintended Consequences will take over. The remaining "insured" savings of $620 Billion will be "transferred" to gold yielding a demand of 45, 000 tonnes...50 times the WGC's last year posted world demand.

Mrs. Watanabe has Mr. Koizumi and Mr. Greenspan by the balls.

http://silverinstitute.org/news/pr31jan02.html "If silver were to replace the arsenic in these wood products, about 80 million ounces would be consumed in the United States, based on the 1997 production figures. An additional 50 million ounces would be consumed in other countries. If other preservatives (such as creosote) were to be banned- several European countries are considering such a ban- even more silver would be consumed."
*******
This would roughly double the world yearly deficit. Can any of our European friends confirm or deny that non-toxic preservatives are being sought? The article also mentions marine paint and preservatives for aquatic use.
Rich

Ken Gooding of Mining Web observes correctly that there could be something odd about
the German Bundesbank announcement. If:

a. The Germans really wanted to use the proceeds of a gold sale to improve their
"infrastructure",

it follows that

b. they would wish to maximize their profits on such a
sale, so

c. Why talk about it in advance?

d. Why even think about selling it on the open market?

e. Why not arrange a private placement of so many tons of gold
bullion with the central banks of Japan, China, Russia or any
other country which reportedly wishes to raise their gold
reserves and should be eager buyers?

Instead of guessing how low the Dow can go, how about when the Dow index number = POG.
Have you seen the Schwab analyst calming investors on the TV ad?
" Yes, we're all a bit nervous. But, with a little Dow down, some dollar depreciation $3000/ounce gold, a few $200 silver coins and some throw-the-dart method chosen bonds, we'll all get through this difficult time. After all, we're in this for the long term!"
I paraphrased this a little.
The coming rise in metals prices will require patience before profits. Are we in for the long term, yes?
Rich

http://money.msn.com/content/P18520.asp?special=msnHas somebody slipped something into the punch? These media guys are starting to sound positive, positive, positive. Do they know this is the kiss of death for JPM & USD, or has it been decided to let POG loose and sauve qui peut?

This guy is saying much of what we have said for several years (except confuses unhedged with "unleveraged") only we were just early, early, early. Don't ya hate it when ya do that? Oh well, we need others to make a party, apparently.

Of course, these press guys wouldn't be doing their jobs if they hadn't quietly been searching out a few sites like this and trying to read up a little background. Never letting on where they got it. But this guy utters not one of the derogatory insults we're used to.

I guess I had sort of been thinking from the FOA scenarios that the paper markets might melt without a prior positive peep in the press, but it looks like there is a growing momentum swing ahead. That oughta finish 'em for good, and, if FOA has been correct, before too many can get on board. Of course they will first think "Stocks, stocks, stocks", so let's see where they end up?

Rich - Hopefully not to start another AU/AG debate (smile), I haven't seen anyone mention for a while the fact that it's pretty hard to start and maintain an extended war without a stockpile of silver. We've sold ours, have we not?

I'm still playing a bit of paper, and the leverage appears to be in silver right now, technically and fundamentally.

Any thoughts???

Cavan Man - If the world starts to get a bit nervous about US debt (i.e. Japanese Bank liquidation of assets for liquidity) where are a few trillion dollars to go? US stocks will get their fair share since they are a weak asset play, but one of the larger markets. Dollars have to go somewhere. The banks can defer interest and debt payment for corporations for a long time.

I agree with Black Blade that there is no turn around in sight for the economy, but if the US dollar really starts to weaken, stocks will probably go thru the roof to new alltime highs. And since most people and the media look, see, feel, touch, and talk stocks, everyone will think a new bull market is in the works, when in fact the sky will be starting to fall. Could be the biggest blow off in history. We shall see, right now the shorts are running for cover. Volitility and knee jerk reactions are probably going to be the pattern for a while.

Just a few thoughts (worded poorly too),

Pizz

I obtained a US patent in 1998, and world rights (Patent Cooperation Treaty, Geneva) in 2000, (utility patents for a medical device) but have never come across Land Patents. As far as I am aware there are only three types of patents in the US - utility, design, and plants. Patent rights exclude others from manufacturing, using, or selling any of the numerous claims of inventiveness/originality identified in the patent within the jurisdiction of the patent. It seems odd to me then, that land, gold mines or mining claims could be patented. Unless, of course, land patents refer to exclusive rights outside of traditional patent definitions. Maybe others have more insight...Cheers,
Waverider

http://biz.yahoo.com/ap/020304/waste_management_job_cuts_1.html
Waste Management to Cut 2,000 Jobs in Restructuring

Snippit:

HOUSTON (AP) -- Waste Management Inc. (NYSE:WMI) said Monday it will eliminate 2,000 jobs, including one layer of management, as part of a restructured business plan that aligns its collection, transport, recycling and disposal resources with market areas.

Black Blade: More "Bones" shuffle off to the growing "Bone Pile".

http://biz.yahoo.com/ap/020304/enron_analyst_1.html
Analyst for Houston Office of UBS Says Was Fired for Telling Clients to Sell Enron Stock

Snippit:

HOUSTON (AP) -- A financial adviser for the Houston office of UBS PaineWebber believes he was fired last summer because he told clients to sell their Enron Corp. stock. "Enron management was not pleased and due to the employee stock option relationship UBS PaineWebber has with them, the pressure came from my corporate office to the branch level (Houston) to dismiss me," Wu wrote in the filing to the association, a securities industry self-regulatory organization.

"I told the truth to my clients," he added. Wu, who had been with UBS PaineWebber for about two years, was fired the same day he sent the warning to his clients. David Walker, a spokesman for UBS PaineWebber, confirmed late Monday Wu was fired for sending the e-mails.


Black Blade: Fired for doing his job correctly. It goes to show how ethical UBS Paine Webber is. Their way of saying "screw the shareholders".

http://www.iht.com/articles/49929.htm
Snippit:

I think we are in a structural bear market that will last for five to 10 years. It is not a nice picture. But it will not go straight down. From time to time there will be fiscal and monetary stimulus. Markets will get oversold and will rise for awhile. Markets will zigzag downward. It will not be over until stocks trade at attractive valuation levels.

Black Blade: I agree. He makes several good points.

http://cbs.marketwatch.com/news/story.asp?guid=%7B820A2CA6%2D8472%2D4DC9%2D920D%2DBD2AABF22E81%7D&siteid=mktw
Investors question analysts, expensive stocks

Snippit:

On gold ...

"I sold all my bond holdings . . . and put some more money in gold stocks. Why not? (See related story.) It appears you can't trust corporate managements, the auditors, or the Wall Street analysts. If Japan's economy falls into a black hole, U.S. investors will definitely feel it. Our president has a cavalier attitude about deficit-government spending that rivals Lyndon Johnson's. Given the current environment, I'll pass on dollar-denominated financial assets." -- Steve Westling, Atlanta

On mutual funds ...

"Mutual fund managers are sitting on billions of assets that are under-performing, some for three years and running. Yet they pull down millions in operating expenses and do so on a daily basis. The massive amount of money tied up in American's retirement accounts, mutual funds, is like a time bomb ready to go off. We can't expect the government to do anything to save this money even if they knew; e.g., Enron shareholders (ENRNQ) lose all their money in a company stock going bankrupt. Why not have the mutual fund managers work for the cities and have those millions go to the taxpayers instead of investment folks, who at the moment, don't seem to be doing much for the public except causing us discomfort and pain?" -- Rob Foley, Norwalk, Conn.


Black Blade: So who is doing all the buying on Wall Street? Hmmm� Meanwhile, the crowds rush to and fro looking for safe havens. With the surge on Wall Street I wonder if many will be convinced to jump in as "the water's fine".

Last May in Machu Picchu I had a vision that gold would hit US$370 by May 2002. I really must stop smoking that stuff.

I went to the trouble of obtaining the land patent on my property in Oregon. I'm not sure having the patent does a lot of good without going through the laborious process of "perfecting" it. Even then, I've seen local judges just ignore it. You might be able to win your case if you had the time and money to fight it through the system.

For information: Most of the land in the US was originally granted by the gov't to its original owner via a land patent, or, as is the case throughout much of the West, granted by treaty. (For example, most California land originally passed by the Treaty of Guadelupe Hidalgo.)

You can obtain a certified copy of the patent on your land through the National Archives. In the patent the land is granted to the original owner and his "successors and assigns" forever. The idea is that you declare yourself to be one of those "successors and assigns" and build a body of circumstancial evidence supporting your claim. Then, your claim on the land supposedly pre-dates all local ordinances, EPA regulations, state and local tax laws, etc.

Theoretically, the gov't obtains jurisdiction over your land only through someone in the chain of owners having previously agreed to said jurisdiction. (My land is part of the Rogue Valley Wilderness Preserve because somebody back around 1950 sold an easement to the gov't. All owners since then are bound by that easement.)

By establishing yourself as the successor to the original patentee, you invalidate (theoretically) all those other restrictions. The legal theory seems sound. But the problem is no gov't agency is going to honor your patent without a fight.

http://www.fas.org/nuke/trinity/hiroshim/truman1.htmStatement by the President of the United States
IMMEDIATE RELEASE -- August 6, 1945

Sixteen hours ago an American airplane dropped one bomb on Hiroshima, an important Japanese Army base. That bomb had more power than 20,000 tons of T.N.T. It had more than two thousand times the blast power of the British "Grand Slam" which is the largest bomb ever yet used in the history of warfare.

The Japanese began the war from the air at Pearl Harbor. They have been repaid many fold. And the end is not yet. With this bomb we have now added a new and revolutionary increase in destruction to supplement the growing power of our armed forces. In their present form these bombs are now in production and even more powerful forms are in development.

It is an atomic bomb. It is a harnessing of the basic power of the universe. The force from which the sun draws its power has been loosed against those who brought war to the Far East.

Before 1939, it was the accepted belief of scientists that it was theoretically possible to release atomic energy. But no one knew any practical method of doing it. By 1942, however, we knew that the Germans were working feverishly to find a way to add atomic energy to the other engines of war with which they hoped to enslave the world. But they failed. We may be grateful to Providence that the Germans got the V-1's and the V-2's late and in limited quantities and even more grateful that they did not get the atomic bomb at all.

The battle of the laboratories held fateful risks for us as well as the battles of the air, land, and sea, and we have now won the battle of the laboratories as we have won the other battles.

Beginning in 1940, before Pearl Harbor, scientific knowledge useful in war was pooled between the United States and Great Britain, and many priceless helps to our victories have come from that arrangement. Under that general policy the research on the atomic bomb was begun. With American and British scientists working together we entered the race of discovery against the Germans.

The United States had available the large number of scientists of distinction in the many needed areas of knowledge. It had the tremendous industrial and financial resources necessary for the project and they could be devoted to it without undue impairment of other vital war work. In the United States the laboratory work and the production plants, on which a substantial start had already been made, would be out of reach of enemy bombing, while at that time Britain was exposed to constant air attack and was still threatened with the possibility of invasion. For these reasons Prime Minister Churchill and President Roosevelt agreed that it was wise to carry on the project here. We now have two great plants and many lesser works devoted to the production of atomic power. Employment during peak construction numbered 125,000 and over 65,000 individuals are even now engaged in operating the plants. Many have worked there for two and a half years. Few know what they have been producing. They see great quantities of material going in and they see nothing coming out of those plants, for the physical size of the explosive charge is exceedingly small. We have spent two billion dollars on the greatest scientific gamble in history - and won.

But the greatest marvel is not the size of the enterprise, its secrecy, nor its cost, but the achievement of scientific brains in putting together infinitely complex pieces of knowledge held by many men in different fields of science into a workable plan. And hardly less marvelous has been the capacity of industry to design, and of labor to operate, the machines and methods to do things never done before so that the brain child of many minds came forth in physical shape and performed as it was supposed to do. Both science and industry worked under the direction of the United States Army, which achieved a unique success in managing so diverse a problem in the advancement of knowledge in an amazingly short time. It is doubtful if such another combination could be got together in the world. What has been done is the greatest achievement of organized science in history. It was done under high pressure and without failure.

We are now prepared to obliterate more rapidly and completely every productive enterprise the Japanese have above ground in any city. We shall destroy their docks, their factories, and their communications. Let there be no mistake; we shall completely destroy Japan's power to make war.

It was to spare the Japanese people from utter destruction that the ultimatum of July 26 was issued at Potsdam. Their leaders promptly rejected that ultimatum. If they do not now accept our terms they may expect a rain of ruin from the air, the like of which has never been seen on this earth. Behind this air attack will follow sea and land forces in such numbers and power as they have not yet seen and with the fighting skill of which they are already well aware.

The Secretary of War, who has kept in personal touch with all phases of the project, will immediately make public a statement giving further details.

His statement will give facts concerning the sites at Oak Ridge near Knoxville, Tennessee, and at Richland near Pasco, Washington, and an installation near Santa Fe, New Mexico. Although the workers at the sites have been making materials to be used in producing the greatest destructive force in history they have not themselves been in danger beyond that of many other occupations, for the utmost care has been taken of their safety.

The fact that we can release atomic energy ushers in a new era in man's understanding of nature's forces. Atomic energy may in the future supplement the power that now comes from coal, oil, and falling water, but at present it cannot be produced on a basis to compete with them commercially. Before that comes there must be a long period of intensive research.

It has never been the habit of the scientists of this country or the policy of this Government to withhold from the world scientific knowledge. Normally, therefore, everything about the work with atomic energy would be made public.

But under present circumstances it is not intended to divulge the technical processes of production or all the military applications, pending further examination of possible methods of protecting us and the rest of the world from the danger of sudden destruction.

I shall recommend that the Congress of the United States consider promptly the establishment of an appropriate commission to control the production and use of atomic power within the United States. I shall give further consideration and make further recommendations to the Congress as to how atomic power can become a powerful and forceful influence towards the maintenance of world peace.

http://levine.sscnet.ucla.edu/general/whatis.htmRecently saw the movie "Beautiful Mind" about one of the founding fathers of modern game theory, Robert Nash. (If you find the movie inspiring, I would advise against spoiling it by looking up the man's real life story.) I knew from the start that he had shared a Nobel Prize.
What surprised the heck out of me was that the prize was in the field of economics!

Try researching Game Theory on the internet and most of what you'll find will be practically unintelligible unless you are a mathemetician.
BUT...try the link above for a plain English introduction.

How does Game Theory relate to gold? Gold is both political and economical. Game theory is being used in both arenas. It is being used to govern decision making in relationships maintained by various mining and investment companies, banks, and governments to gold.

I admit to only a very rudimentary understanding of the subject, but it looks to me like the forces that command gold have been in a Nash Equilibrium from '96. It's the mid-stage of a game where all the players have found a strategy that works well against all the other strategies being played. It works well enough for awhile, as everyone profits a little. But to really WIN the game, someone has to break equilibrium and take the big risk for the big gain.

In May of 2001, I think Greenspan signaled the beginning of the end-game when he lowered dollar interest to nearly match gold interest.

Maybe Greenspan's real name is "Magister Ludi" the Master of the Glass Bead Game (novel by Herman Hesse). I wouldn't be surprised if the mathemetician who gave me that book, about twenty years ago in Huntsville, AL, reads this forum. I think he knew, because he asked me to answer only one question, "What is the glass bead game?"

What do you think?

On the gold trail, looking for sign posts.
Simply

http://search.msn.com/results.asp?RS=CHECKED&FORM=MSNH&v=1&q=glasperlenspielSimply Me -- das Glasperlenspiel -- ah yes. Long ago, but it wasn't at Morbio Gorge, was it? No, I'll have to remember better before I see if I've been involved in a more complex game than I thought.

El Gringo -- I had a Machu Picchu dream, too, long ago -- didn't have any gold info in it, but, as I flew over it, a deep, almost thundering voice said "Now do you know why I built this place?"

Pizz -- Why does USD weakening promote a stock rally -- thought it was the other way? I can see it getting a boost from Japan flight capital, but weak dollar would give Europeans the jitters, no?

Never been to Morbio Gorge, Mr. Gresham. Relax.
Simply ;)

http://www.usagold.com/gildedopinion/puplava/20020301.htmlExcerpts:
-------...lack of qualitative thinking is most evident in the world of politics and economics. What passes for understanding is strewn with emotion rather than reason. Without the ability to reason, and with only emotions as our guide, any understanding of economic or current affairs is devoid of meaningful analysis.

This is no more evident than the current discussion and debate within the financial markets. The late 60's and the decade of the 70's were a long period of rising inflation triggered by the U.S. abandoning backing the dollar with gold. After the U.S. went off a gold-backed dollar system, the Fed was free to print money at will, and it did. Inflation levels rose and the price of most commodities also rose to reflect the decline in purchasing power of the dollar. During this inflationary era, ordinary citizens and investors lost all confidence in the dollar. Instead, people put their money into hard goods.------------

---------In the last two decades whenever there was a crisis, the financial world clamored for even more money creation. Wall Street never questioned it. Rather, they encouraged it. On Wall Street there was a new love affair with money creation. Analysts and economists on The Street knew that in any crisis the Fed could be counted on to flood the financial system with liquidity and most of that money was injected into the financial markets.

A new crisis meant more money and higher stock prices. Everyone was happy with the arrangement. Politicians loved it because it made them look good when the economy and financial markets prospered. Wall Street loved it because rising markets meant more business through stock and debt underwritings and stock commissions. Most investors loved it because they saw their net worth enlarged without saving.----------

----------When central banks create money, they oftentimes can't control where it goes. In the 1970's the money went into things. In the 1980's, 1990's and our current decade, it went into paper. Inflation has two outlets. It can manifest in higher prices of goods and services or in higher prices of paper assets. They are one and the same. The only difference today is that we no longer call it inflationary. It is known as "investment return." If stocks go up 20% for five years in a row, it is called a new era or new paradigm. If real estate prices rise 20% a year, it is called a boom. The very fact that few question the inflationary implications of these two phenomenons is another example of the lack of economic literacy.--------------

----------There was only one problem with this whole scheme. Each new crisis required even greater amounts of money to quell it. Eventually, there would come a day when it would no longer be possible to keep inflating without adverse consequences........seen erupting in Argentina, Venezuela, and in Japan.-------------

(click URL above for full report)

Diversification into gold bolsters your portfolio against the diminished purchasing power of your local money and against other financial losses associated with these inevitable "consequences" of inflationary policy.

R.

When are the BOE auction results released?

If all goes well and without unforseen difficulties, the auction results are to be announced within 45 minutes of the 11:30 a.m. (London time) close of bidding.

Simply adjust 12:15 p.m. Greenwich in accordance with your local time zone.

R.

News Release -
HM Government Gold Auction Result: 5 March 2002

5 March 2002

The Bank of England announces that the gold on offer (approximately 20 tonnes or 643,200 ounces) has been allotted in full at a price of $296.50 per ounce. Details of the result are as follows:

Amount of gold on offer (approx.) 643,200 oz
Amount applied for 2,408,800 oz
Times covered 3.7 times
Amount allotted to bidders 644,400 oz
Allotment price $296.50
Scaling factor at allotment price 0.8197 %

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 7 March 2002.

Note for Editors

On 7 March 2001, H M Treasury announced that the Bank of England, on behalf of H M Treasury, would sell approximately 120 tonnes of gold in a programme of six auctions of around 20 tonnes each in the financial year 2001/02 on the terms and conditions set out in an Information Memorandum that was published on 7 March 2001. This is the final auction in the programme of six and brings to an end the programme to restructure the United Kingdom's official reserves that was announced by HM Treasury on 7 May 1999.

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256B7300365062?OpenDocumentIt appears South Africa's other 'Durban Gold' product, which is a crop, is finding it's way to DRD board rooms. 'Disconnected' is not nearly strong enough when discribing Mr. Kebble. W.W. is nothing less than a miracle man to shareholders, and Kebble thinks he can pull this off?

The South African government is also hitting the bong it would seem as they 'just don't get it'. Someone has to be rewarded for business risk and fortune. W.W. deserves every penny for the job he's done. Watch out for the fires of socialism being stoked on this one thanks to Mr. Kebble's attacks on W.W.

Durban is a poster child for whatever could possibly go wrong in the mining industry....earthquake next?

They successfully kept the gold price capped for almost three years with what around 600 tonnes of gold. They might have disenfranchised the British public of their gold but they must have made a bloody killing for the gold carry trade. Who is next in line? Will it work this time with the number of new acquirers of gold in the world growing exponentially? The 600 tonne question.

http://news.bbc.co.uk/hi/english/business/newsid_1845000/1845024.stm
Snippit:

Gold production is down more than 8% South African production of gold slipped by more than 8% in 2001, the Chamber of Mines of South Africa has reported. Gold output slipped to 393,254 kilogrammes - its lowest level since 1953 - from 427,981 kg in 2000.

Black Blade: Lower Gold supply coming to market. Add to this scenario that Gold exploration is almost nonexistent and that it takes years to bring a mine into production. In many cases mines will never be brought into production due to unfriendly business environments (i.e. TVX in Greece).

This is not, I repeat not an endorsement of either stock! I am just curious if anyone is familar with Global Pacific. I know the Dayton situation pretty well. I am a long suffering shareholder and would appreciate any insite into the properties of character of the Global Pacific company. THanks in advance.

That should be " I just got word of the merger" and I would like information about the character of the various managers of Global Pacific.

http://asia.cnn.com/2002/BUSINESS/asia/03/05/aust.gold.biz/index.html
Snippit:

SYDNEY, Australia (CNN) -- Gold's two-year high of $300 an ounce reached in early February is unlikely to be sustained, according to commodity analyst Poppy Liatis of Nomura Australia.

Black Blade: I smell fear among the anti-Gold ranks. Meanwhile, Gold looks like it could move higher today now that the BoE Gold giveaway program has ended. Look for a "full court press" by the media to quash any higher POG moves. Actually, the POG is rising a bit now. Hmmm...

http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=28262615&ID=cnniw≻ategory=Metals+%26+Minerals%3APrecious&
Snippit:

In recent years Morgan Chase has invested much of its capital in derivatives, including gold and interest-rate derivatives, about which very little information is provided to shareholders. Among the information that has been made available, however, is that as of June 2000, J.P. Morgan reported nearly $30 billion of gold derivatives and Chase Manhattan Corp., although merged with J.P. Morgan, still reported separately in 2000 that it had $35 billion in gold derivatives. Analysts agree that the derivatives have exploded at this bank and that both positions are enormous relative to the capital of the bank and the size of the gold market.

It gets worse. J.P. Morgan's total derivatives position reportedly now stands at nearly $29 trillion, or three times the U.S. annual gross domestic product.

Wall Street insiders speculate that if the gold market were to rise Morgan Chase could be in serious financial difficulty because of its "short positions" in gold. In other words, if the price of gold were to increase substantially, Morgan Chase and other bullion banks that are highly leveraged in gold would have trouble covering their liabilities. One financial analyst, who asked not to be identified, explained the situation this way: "Gold is borrowed by Morgan Chase from the Bank of England at 1 percent interest and then Morgan Chase sells the gold on the open market, then reinvests the proceeds into interest bearing vehicles at maybe 6 percent. At some point, though, Morgan Chase must return the borrowed gold to the Bank of England, and if the price of gold were significantly to increase during any point in this process, it would make it prohibitive and potentially ruinous to repay the gold."

Robert Maltbie, chief executive officer of www.stockjock.com and an independent analyst, long has followed Morgan Chase. He tells INSIGHT that "there are a lot of things going on in these companies, but we don't know for sure because much of what they're doing is off the balance sheet. The market is scared and crying out to see what's under the hood. Like Enron, much of what the banks are doing is off the balance sheet, and it's a time bomb ticking as we speak."

Just what would happen if a bank the size of Morgan Chase were unable to meet its financial obligations? "It's tough to go there," Maltbie says, "because it could shake the financial markets to the core."


Black Blade: I suspect that JPMC could "Ashanti" all over the market if the POG rises. JPMC has many problems lately from Enron, Global Crossing to the blow up on loans to Argentina. Interesting article during "Interesting Times".

You're absolutely right. We can take pleasure in the media reports regarding 'lost' value at the hands of the gold auction, but in fact, the 600 tonne sale reaped gold carry trade profits to compensate well over the losses through rising POG movement.

The cartel, however, are not able to publicly argue this point, who in by doing so would then be admitting guilt in their illegal transactions.

So enjoy the heat they take in the press and their inability to rebut with underlying, ill gotten, profitable gains....which are destined to be temporary anyway once PoG moves ahead with a vengance.

Perhaps that is when the media reports on irresponsible management will finally be focused on the deeper issue of long running cartel manipulation, not these's superficial misleading reports of bank/country losses through sale value misadventures.

Eddie's 'abyss' is always going to be there and it's something every single inhabitant of the planet should be concerned about. It's magnitude is serving as a diguise... too hard to grasp... but it's just a matter of time.

Final BoE gold sale disappoints despite top price
By Adrian Dascalu

LONDON, March 5 (Reuters) - The Bank of England on Tuesday sold 20 tonnes of gold at its highest price yet, in the last auction of a three-year programme to more than halve the UK's gold reserves to 300 tonnes and modernise
reserves.

The $296.50 per ounce award was the highest of the UK's 17 auctions and analysts said demand was a "reasonable" 3.7 times the amount on sale, but it disappointed those who had banked on a last-minute scramble to drive the gold
price back above $300.

Longer term, gold prices will draw little relief from the programme's end as other central banks line up to sell an asset no longer seen as a bulwark against financial turmoil. The UK is using the proceeds to stock up on
foreign currencies.

"It's an average auction...you have to measure it against expectations and some people were putting a (figure) three in front of the price," said Andy Smith, of Mitsui Precious Metals.

Spot gold (XAU-) was a touch higher immediately after the auction but eventually prices retraced and by 1328 GMT spot was indicated at $296.90/297.40, still up from Monday's New York close at 296.60/297.10.

Total gold sold through the BoE's series of 17 auctions since July 6, 1999, amounts to 395 tonnes, with revenues from the sales for the UK Treasury estimated at $3.3 billion.

OTHER CENTRAL BANKS READY TO SELL

Although the UK said its programme is at an end, other central banks are stepping up to sell their holdings as inflation, and the need to shield assets from it, fades.

Last month, Germany's Bundesbank, a previously committed hoarder of gold with reserves estimated at some 3,500 tonnes worth some $31 billion, said it did not rule out selling part of its gold for assets generating higher returns.

Under a five-year accord of 15 European central banks that expires in 2004, the Netherlands and Switzerland are already selling off their stores.

In a statement on Tuesday, the industry-funded World Gold Council (WGC) said the BoE's final gold sale "has again illustrated how misguided the policy is."

"If Britain still had that gold the nation would be more than 175 million pounds better off," the council's Chief Executive Haruko Fukuda said in a statement.

"The gold sales have also been quite costly in national terms because, after taking into account investment earnings on the receipts of sales re-invested in dollar, euro and yen securities, the net result of the gold sales overall has been a loss of about 175 million pounds ($248 million)," the WGC said.

The remaining 320 tonnes of gold in the reserves will be equivalent to only seven percent of gross reserves. "At this level the UK will have the lowest proportion of gold amongst the leading nations of the European Union," the
WGC said.

The previous auction on January 16 had the lowest number of bidders ever and was only covered 1.4 times, compared with a record eight times at the second auction back in September 1999.

The highest previous allotment price was $293.50 at the third auction in November 1999, while the lowest, at $283.50 an ounce, was at the January 16 auction this year.

At the end of the BOE sales, gold prices are just five percent higher than they were prior to the bank's 1999 announcement that it would start its sales programme, and for much of the period they have been lower.
*****************
uponroof- OK CB's... just sell everything... get it over with. If gold is so useless, SELL IT.

Low dollar & Stock Rally

I'm still working on this in my head, but since we are going to have to finance a war in the midst of a depression, bonds have to go down and rates go up.

As bonds liquidate, the Fed must monetize them. I can't see banks/funds buying bonds into a down senario. The liquidity combined with our deficit dollars in circulation have to go somewhere.

I don't think this SM rally is demand driven, but dollar supply driven.

Our economy appears to have stabilzed somewhat also, call it the plateau of the first wave down. Now, corporations will start to raise prices - inflation. Chip prices have already turned. Oil is going up - more war related than recovery rated. More inflation.

I could be totally off base, and it could be just a seasonal fluke in the dollar. Only time will tell.

Off to the dentist. Maybe i'll get a better view under the nitrus - can't hurt!

Pizz

Now,

http://globeinvestor.com/servlet/WireFeedRedirect/Reut/20020305?cf=GlobeInvestor/config&vg=BigAdVariableGenerator&date=20020305&archive=roc&slug=2002-03-05T132033Z_01_N04348125_RTRIDST_0_BUSINESS-ECONOMY-CANADA-RESERVES-COLSnipppit:
"Canadian foreign reserve holdings rose in February and the government sold 95,000 ounces of gold during the month, the Finance Department said on Tuesday.

Sales of 95,000 ounces of gold settled in February, leaving gold holdings at 1.0 million ounces on Feb. 28. The Canadian government, which had about 22 million ounces in 1979, has a policy of gradually selling off its gold reserves and replacing them with interest-bearing instruments."

Waverider: Canada was 22 million ounces better off in 1979 -what can I say without being rude...

in February reports Bloomberg
By Monee Fields-White


Washington, March 5 (Bloomberg) -- The U.S. service economy expanded in February at the fastest pace in 15 months, according to an industry survey of executives, suggesting a recovery is under way.

The Institute for Supply Management's index of non- manufacturing business rose to 58.7 in February from 49.6 in January. A reading above 50 signals expansion.

``We are turning the corner,'' said Brian Wesbury, chief economist at Griffin, Kubik, Stephens and Thompson in Chicago, before the report. ``This is a sign the economy is expanding once again.''

Services companies, construction firms and other non- manufacturing businesses account for about four-fifths of the economy. The report, along with a February expansion in manufacturing for the first time in 19 months, adds to evidence the recession that began a year ago is over.

...cb2 - feels that four fifths of the US economy being in the service sector bodes well for servicing the surging debt. To add insult to Mr. Wesbury's above quote - debt is the only thing expanding in the US econmomy.

Every once in a while someone does a story on how organized crime has managed to infiltrate into Japanese business.
Has anyone ever come across any $ figures for the amount of money they have under "their" control? Either through profits or persuasion?
One might wonder what demand they could bring to the gold market if they were to smell opportunity?
When all is said and done in Japan, it will be the same as everywhere else in the world. "HE WHO HAS THE GOLD, MAKES THE RULES".
Opportunity is knocking at their door. BUY OR DIE?

Waverider

Good thing their hockey teams brought home the gold. That just increased the national holdings by 12%....Just kidding.

Canada has a whopping 32 tonnes left. That's just ahead of Bangaladesh....Just kidding....I think

Perhaps they are confident in public lands holding reserves? If it comes to desparate measures could they build nationally run mines on public land?

Incredible.

Personally,i saw golds move through the boe auction price as a great sign!Let the central banks line up,20 tonnes wont do it anymore!We still have april 1st lifting of bank deposit insurance in japan,JPM chase settling of derivatives march 31st'spring campaign in iraq?(higher oil prices),lifting of interest rates and the chinese gold exchange's opening to look forward too.All the cartel can do is the odd newspaper article no one is reading anyhow.Gold has no where to go but up and those banks better line up and sell cause demand is growing but supply is shrinking.Dont look now but here comes golds friend..INFLATION!

That article (in your #71116) is pure propaganda. Anytime you see a flat statement made to look like a fact when its someone's opinion you can bet you are reading something cooked up by our financially correct commissars in London or New York.

I am referring to this forlorn lament thrown into the wind of the current economic tumult:

"Longer term, gold prices will draw little relief from the programme's end as other central banks line up to sell an asset no longer seen as a bulwark against financial turmoil. The UK is using the proceeds to stock up on foreign currencies."

1. With respect to central banks 'lin[ing] up to sell', there is the failure to mention that other central banks will be lining up to buy. Over the past years, despite all the rhetoric (and it hasn't changed much in terms of tone and content over that entire period from the quote above) -- all the announcements, threats of sales and actual sales -- the central bank have been relieved of only 3000 tonnes of their 'onerous' burden. That amounts to 60 tonnes a year -- a small star in the golden galaxy. All the foregoing assumes of course we will leave the course set down by the Washington Agreement -- an unlikely event since the WA was advanced for very good reasons by the central banks themselves (most of which had to do with regulating the proliferation of fractional reserve gold lending.)

2. With respect to 'an asset no longer seen as a bulwark against financial turmoil,' tell that to Alan Greenspan who repeatedly has stated that gold is precisely what this propagandist says it isn't -- a safe haven and bulwark against financial turmoil. Also tell that to the ECB which made it a point to include gold in its reserves as bulwark against financial turmoil including an attack on its currency. Tell it to the people of the United States, Europe, Japan, China and India who in the face of the building economic maelstrom have initiated record worldwide demand for gold.

3. So far the UK's 'stocking up on foreign currencies' supposedly for the sake of a better return has been a disaster for which Parliament ought to call Eddie George and Gordon Brown on the carpet. Leaving aside that these 'policy-makers' (we won't make the mistake of categorizing them as 'statesmen') have set Britain back decades in its attempt to retake solid ground in the world economic sweepstakes. Much of what Margaret Thatcher accomplished in rebuilding the UK among the nations has been cast overboard. Messrs. George and Brown should recall that Britain's rapid fall from the top was led by the pound sterling descending the depths of hell. Do Messrs. George and Brown really believe that tying the fortunes of the pound to the dollar, euro and (God forbid) the yen and abandoning gold the best policy?

Of course the propaganda serves its purpose with the unsuspecting public which takes much of what they read from the wire services as gospel. For those looking to gain a better understanding of the new post-Enron real world, however, articles like this need to be understood for what they are: Leftist propaganda designed to keep citizens savings 100% in dubious currencies that can only be defended by manipulation of public opinion. When that breaks down look out for tighter sanctions similar to what occurred in Argentina. If fiat currencies were inherently strong, the propaganda would be unnecessary. They wouldn't have to worry about a flight to gold. But fiat currencies are indeed experimental and they are are precisely the opposite -- they are inherently weak. They, therefore, need to be defended at every turn.

For reasons I have never been able to fathom, those responsible for these propagada binges cannot even sanction a modest diversification into gold (as we recommend here) for portfolio insurance purposes. Why is their fear so great?? That is the question every well-heeled investor must contemplate thoroughly, for it is there that they will find at the core what's wrong with the current economic system. These same 'advisors' would have you put all your money in stocks and bonds -- no matter how dubious the value of both the stocks themselves or the currency in which they are denominated. The gold industry on the other hand has been very moderate in its advice and a haven of sorts itself as the Wall Street mess unfolds daily on our TV screens. None of us will tell you to put all your money in gold, but we will tell you given the circumstances that a prudent diversification into yellow gold isn't going to hurt you.

http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256B73004B4155?OpenDocumentSnippit:
"Mark Wellesley-Wood confirmed he would remain chief executive and chairman of Durban Roodepoort Deep [NASDAQ:DROOY] following a bungled attempt to remove him from the board today. Grant Fischer, non-executive director of Durban Roodepoort Deep (DRD) and a director of Roger Kebble's Rand Leases, had compiled a memorandum, approved by his legal team, recommending why Wellesley-Wood was contravening the law by remaining as chairman, and that he should be removed.

On Monday, Fischer called for an urgent board meeting in which he planned to submit papers from Home Affairs spelling out Wellesley-Wood's South African residency problems. In essence, the memorandum said that since Wellesley-Wood was in violation of South African residency regulations he should be removed as chairman and replaced by another. Pending Wellesley-Wood's efforts to return to South Africa, his position could be reviewed within three months, the memorandum said.

Instead Fischer did not call for the removal of his chairman; in fact, Wellesley-Wood received the unanimous support of his board including that of Roger Kebble whose executive duties were suspended by Wellesley-Wood yesterday. Fischer was also censured by the board for not following the correct procedures. For instance, DRD did not have copies of papers of correspondence with Home Affairs held by Fischer and which were used by him to motivate for the resignation of Wellesley-Wood."

Waverider: What a saga! I'm anticipating WW will be back in SA by the end of the week, if not before. Uponroof/Belgian -great argument for buying physical only, but so far I've held on for the ride. BTW Belgian, I'm in Europe this summer - if I lose on DROOY, lunch is on me! Cheers, gotta run, a great day to All!

Number 1. second sentence should read:

"Over the past 50 years. . . . ..etc"

Doesn't make much sense without it.

http://www.imf.org/external/np/exr/ecforums/2002/031503.htmDo you suppose gold will be mentioned as a solution?

http://www.imf.org/external/np/exr/ecforums/2002/031502.htmHope this one works

Greetings from FOA/A? Once the physical support is removed from the paperarena,Comex/LBMA to collapse on its own weight,you know,paper does not carry that much weight...

Maybe the Swiss are selling into the NPGM already?Announcement imminent?

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&refer=topsum&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin∣dle=ad_frame2_topfin&s=APIT_dhTwSi5QLiBN
Snippet:

U.S. District Judge Jed Rakoff sided with Citigroup Inc.'s Travelers Property Casualty, Safeco Corp., Liberty Mutual Insurance, St. Paul Cos. and other insurance companies today. The insurers had challenged contracts between Enron and Mahonia Ltd., an affiliate of the second-largest U.S. bank.

Rakoff said the insurers had presented enough evidence that the bonds ``WERE THE PRODUCT'' OF FRAUD BY J.P. MORGAN for him to deny the bank's bid for immediate payment.

Things aren't looking too good for our friends at JPM......
I hope that ANOTHER certain judge in Boston Federal Court takes note:).

http://www.forbes.com/work/managementtrends/newswire/2002/03/05/rtr531164.htmlThis reinteration is necessary since the first indication of possible sales has stirred up those never dying freeloaders always on the lookout for government relief.

Now these socialists are seeing gold sales as a way to pay for their programs and are talking about it in the media....hence the further denial of sales by Buba.

Perhaps the debate is helping to bring PoG down today?

This totally ABSURD stockmarket (US+Japan) rise, is plain evidence of Worthless-Debt-Dollar deluge ! Bush and Koizumi just agreed on using this paper-blowing in mutual interest.
Dow and Nikkei uber alles (above everything). Read K.Richebacher on debt (GE-example) and the conversation between FOA and Auspec on the US$ (archives-2001)!

How long will it take before another negative Gold-sale story (!) will pop up to replace the noisy UK (virtual) sales ? Shall we hire A.Smith with another POG=100$ campaign ? Or will cheaper, available, Physical (or guaranteed contracts), bring POO down ?

Remember that the US$ must destroy "itself", so no one can be blamed (fingerpointed) for it ! Euroland must be "sure" that the inevitable debtdollar flight is into the gold- euro (shaping the bonzai).

Palestinians are still building on a "provocative" pressure (atrocities)! Don't expect this to fade out in time.

Watch if LBMA volume picks up with rising interest rates, pointing to renewed carry trade with less and less Physical available with lower and lower paper-POG prices !?
(Waverider : misery scenario for your Drooy = 1 Belgian Beer for me :-)) Also note some (temporary) strengthening of Rand/Aus$ = less profitable underground gold = less available Physical = no exploration = more (renewed) hedging !?

http://quote.bloomberg.com/fgcgi.cgi?mnu=news&ptitle=Mining%20News&tp=ad_mine&T=au_storypage99.ht&s=APITrXxQnVGhlQnVs"...I think this whole exercise has been thoroughly misguided. As a result of it we estimate the Exchequer is $280 million poorer on the face it -- enough to buy a couple of hospitals. On economic grounds I don't think you can provide a strong case for moving out of gold and into currencies like the yen and the euro, both of which have depreciated, and the dollar, which provides a negative real interest rate. Against an asset which has appreciated over the period of time by 15 percent and does provide an interest rate over and above that.''

On central bank sales:

``There are central banks that want to leave and they're trying to form an orderly queue. I think these chaps are behind the times. Yes they've seen the gold market in a 22-year decline, but I don't think they're fully aware of the blueprint which the producers have to make gold significantly different..."

Euroland monetary-affairs are NOT in the hands of the "left" but the "center-right" ! Socialist's have the quasi monopoly of the media. So it is easier to understand the duality of the socialist's public dreams and the center-right (monetary) silent reality(ies). This balance is here to stay as it has a proven track record ! Despite all criticism. No war - low level of terror - peace and prosperity. Hope it stays that way ?

KnallGold : I don't think that the Suisse will make public statements about their 1 tonne a day, keeps the dollar OKay.
That's what I understood when they said not to sell "per se" through BIS ! They (Swiss) must have a special task with their 1.300 tonnes !? Note that the UK's remaining 7% goldreserves + the 7% (virtual) sold = close to the 15% EMU gold reserve ???-!!! These 400 tonnes UK-Gold are still in Euroland circles, carefully hidden for temporary convenience. I do suspect the Swiss Gold flowing to the Lawrences of Arabia for their precious black flowing to Euroland. Nothing seems what it is. Regards.

http://biz.yahoo.com/rf/020305/n05209578_2.html``These arrangements now appear to be nothing but a disguised loan -- or at least have sufficient indicia thereof that the court could not possibly grant judgment to the plaintiff,'' Judge Jed Rakoff wrote in denying summary judgment to the U.S. bank, which is a leading Enron creditor. The judge was not expected to grant summary judgment, but the bank felt it had nothing to lose by making the motion.

uponroof- so that's 965 million on the line PLUS court costs etc, etc. U G L Y. These 'disguised loans' (FRAUD), which will be getting so much publicity in the future, will draw attention to their entire book.....including gold transactions. Can they stand the light?
*********
Belgian-thanks for that insight. Unfortunately their words are attached to value. As long as they speak irresponsibly, and those listening are uneducated, gold will suffer.
*********
Mitsui sold 3000 gold contracts today?

Buying and selling I didn't understand if you were asking if true, or questioning the sale when you said,
"Mitsui sold 3000 gold contracts today?"
*******
I heard the same next door earlier today but can not confirm or deny it's validity. Who is Mitsui and who bought these 3000 contracts today? Is this news to be seen as an explanation of today's POG drop?
Did you hear what contract month this refers to? Do you suppose if the news was reported that XXX Corp bought 3000 contracts today instead of reporting the selling party, that POG might have gained? One buys and one sells. If the total number of open interest stays the same, what has changed but the names on the players uniforms?
As Michael just mentioned with only 3000 tonnes of gold really sold (dishoarded) over 50 years by central banks, sometimes simply passing bullion around among different banks or Comex players produces only sound, fury and copy for news services, signifying very little. When POG goes up with increasing open interest, then, perhaps some fireworks!?
Rich

Hello Uponroof,
your question in msg#:71123 -

"For reasons I have never been able to fathom, those responsible for these propagada binges cannot even sanction a modest diversification into gold (as we recommend here) for portfolio insurance purposes."

This article by Sean Corrigan explains why eloquently..

http://www.mises.org/fullarticle.asp?control=897&month=41&title=Dishonest+Money&id=42

Regards,

Golden Bear.

PS. First time post, but have been lurking for a while. Thank you to everyone for their time and wonderful insights and to Mr. Kosares for this forum to allow our thoughts to be expressed.

I saw that next door also and was hoping someone might amplify.

If Mitsui sold a large quanity of contracts in piece meal manner, or in light buying, it would knock down the price. There was also a circus at Buba today regarding gold sales...much ado about nothing but perception is reality.

We'll just have to Wait for clarification from cousin Chris and company tonight.

Welcome, and thanks for the link to Sean Corrigan's article.
Rich

Mitsui is Andy Smith's house. Andy was not exactly bullish today in his remarks after the auction. He seems to be coming down on his previously bullish stance. At least that's what it looks like to me.
********

Golden Bear...

Thanks. Much appreciated. I've read that piece and it is truly inspired. His work requires (at least of me) to be read over 2 or 3 times to get completely all of the intricate yet powerful points. Love his use of words.

http://story.news.yahoo.com/news?tmpl=story&u=/020305/180/17rwp.htmlVery interesting that Bush imposed tariffs on steel today. Keep an eye on this. Higher prices in 'all things steel' are sure to follow.

More importantly it is a "draconian" move to hopefully increase domestic production through penalizing cheaper foreign producers.

It all goes back to the dishonestly strong dollar....which is of course the root of all evil. Bush is trying to side step the real medicine, dollar devaluation.

An early signal of possible economic policy changes?

What an "Interesting" day in the Gold pits. I leave to talk to some prospective clients in Billings, MT this morning and after a stop at the Little Big Horn Battlefield, I return home only to see Gold lower by 1%. True the DOW sank 1.45%, but now I hear rumblings that the BoE auction was a disappointment for Gold investors. HUH?

This is the last BoE Gold auction (actually a giveaway to LBMA and UK-based Gold shorts). The auction was oversubscribed by 3.7 times even though it was an "invitation only" Dutch auction. The only losers that I see are the Brit peoples who were screwed, blued and tattooed by Skipper Tony Blair and First Mate Eddie "Little Buddy" George.

Meanwhile the reality of the overreaction to massaged dubious economic data caused the US equities markets to pull back as many investors awakened from their heady opiate-like highs only to discover that wishing for profits to appear doesn't make it so. While the Pimps of Wall Street and the Media Trolls continue to tout that the recession is over, or never was, America's CEO's are scratching their heads over where and how profits will materialize as they lay off many more workers and plan fewer capital expenditures. To say that this next "earnings season" will be a disappointment is an understatement.

Also Japanese are reported to still be buying Gold ahead of the "April Fools Day" surprise (how appropriate). More restrictions will be added over the coming year. The details aren't fully known, but it appears that the insolvent Japanese banks will only have insurance guarantees on accounts up to about $75,000 US for "all accounts inclusive". So it appears that the Yen tsunami will flow into different banks and under various names in different accounts, and even into an unstable Nikkei. I would suspect that Yen will continue to flow toward Gold, Platinum and possibly gemstones as well. "Interesting Times"

- Black Blade

http://biz.yahoo.com/rb/020305/business_economy_us_oneill_dc_5.html
Snippit:

KUWAIT CITY, Kuwait (Reuters) - Treasury Secretary Paul O'Neill said on Tuesday that the world's biggest economy was on solid ground and ``maybe'' had not suffered a recession in 2001. O'Neill, touring the Middle East for talks on economic and security, told reporters that contrary to a declaration by the National Bureau of Economic Research (NBER), which dates U.S. business cycles, a recession had not set in last year. ``It seems quite clear now that our economy maybe never suffered a recession,'' O'Neill told a news conference.


Black Blade: So this is America's "best and brightest"? No wonder that senile former Ku Klux Klan member Sen. Robert Byrd (D-WV) was able to make him cry like a baby. This guy is one dim bulb.

http://biz.yahoo.com/fo/020304/0304watch_1.html
Snippit:

It looks like the Dow Theory buy signal we were muttering about in March 1's column (see "Nearly Out of the Woods"). But Russell, the old Bull Moose of the Dow Theory, is still stomping his hooves and snorting derisively. He's even speculating about market manipulation, an idea he's flirted with before (see "Methuselah Suspects Market Manipulation") but backed off:

"Blow baby, blow. Looks like the pros want to bring back the bubble. Can you blame them? ... Hey, Wall Street isn't a charity affair, it's a business--and the business is distributing securities to the public. That's right, Wall Street's business isn't collecting stocks and bonds, it's getting rid of them. Seriously, this did look like a blow-off, but we'll only know that in retrospect. I keep thinking of 1966 to 1974, those mini-bull and mini-bear markets."

He means the Dow's repeated feints at 1,000 from 1966 to 1982, which lured so many investors to their doom that Jim Dines of the Dines Letter named it "The Graveyard in The Sky."

Black Blade: I think Russell has it figured out. This see-saw action isn't just like 1966-1974, but just like 1929 to 1937 as well. There are always min-bulls and mini-bears within a general trend. That's not news. Amazing how economists are so quick to call the end of the recession when they completely missed the beginning of the economic downturn. We called it here at the USAGOLD forum early in 2000. Hell, I should get the Nobel Prize for Economics - those guys are nothing but shills (nod and a wink).

It is merging with Pacific Rim Mining not the other company I suggested wrongly earlier.

http://cbs.marketwatch.com/news/story.asp?guid=%7B5B58226D%2D2E8A%2D4951%2D934C%2DAB5C18592804%7D&siteid=mktw
Snippit:

Good news has many parents while bad news is an orphan. Now that the stock market is back to its highest level since last July, commentators of all kinds are rushing to jump on the bandwagon and proclaim themselves born-again bulls. Talk about irrational exuberance! Rosy Scenario is alive and well, and marching on the Street of Dreams.

One commentator is even going so far as to question whether we even had a recession in the first place! Whoa! Time to step back and take a deep breath. First of all, we did have a recession. If you don't believe me, ask the 1.4 million people who have lost their jobs over the past year, the companies whose profits fell by 50 percent or more -- the biggest drop in postwar history -- or the firms in the capital-goods sector for which a recession would be a step up from where they landed.


Black Blade: Exactly!!!

I've been taking notes. I have you currently placed among the leaders but, remember, I only have one vote.
You're running neck to neck with some of the best. Price is an important consideration. Those who demand payment for their thoughts are at a great disadvantage in winning my vote. However, I never quibble over the price of a good book. Let your experience and opinions flow among the facts. Many will want an autographed copy.
Rich

Of this Bank of England gold auction conducted for Her Majesty's Treasury on behalf of the Government of the United Kingdom, you have now said: "The only losers that I see are the Brit peoples who were screwed, blued and tattooed by Skipper Tony Blair and First Mate Eddie George."

How do you justify this position? Are you not aware that citizens in the form of "Brit people" (as with all other nations) have no personal claim upon publicly-held assets? As an American, do you expect ever to have and use "your share" of the Treasury Department gold? Or is it that even now YOU are the people being "screwed, blued and tattooed" as this U.S. gold is held fast? Think well.

A citizen anywhere has but one means to personally gain the benefits of gold -- the gold must be owned individually. Common sense has it to be bought in the ease of personal plenty (savings!), and liquidated when hunger pinches the tight belt and doom lingers to tip the balance.

You are hereby found guilty of mixing the subtle affairs of civilisation with the clear cut lives of single human being. Your sentence is to reconsider whether the "Brit peoples" as a society would have fared better in the absense of these sales, faced instead with a cascading default and collapse of the financial system. Does it surprise you so very much that a people must act at times even as a person must do? Liquidating gold is serious business, taken in light of the alternative consequences. But you see here only the outcome with no thought to the weighing of considerations leading to the decision.

Finding yourself an outdoorsman down to a savings of one last bullet, do you begrudge its utility to keep the wolf from the cabin door? Many give better comfort than one, but even the last ONE has a use! Britain has used but one of two. Sitting isolated and well fed beside your own warm hearth, why do you hear the distant shot from across the mountains and begrudge your "independent" neighbor the decision for its use?

http://search.news.yahoo.com/search/news_all?p=steel&n=10Nippon (Japanese) steel down 4% in early trading, Japan, Russia, Britain protesting tariffs....more sure to come.

American manufacturers, already smoked over the strong dollar handicap now must deal with rising steel costs in their raw material make up. They believe this will cost Americans 74,500 jobs....AND inflationary costs. They are livid.

Bush taking a very controversial risk, both economically and politically to save the steel industry. Will cost Americans 8 jobs for every 1 steel worker saved.



Oh.....I forgot.....just buy stocks and everything will be fine.

Gold $300.00Many times the Goldbugs have assaulted the cabals castle and even managed to breach its front gate, (Gold $300.00) only to be beaten back. Yet the goldbugs persist. They have the castle surrounded and the cabal has just so many arrows,just so many spears and just so much hot oil to rain down on their attackers. In the end they will only have the stone which entombs them to thrust against their enemies. But todays battle has brought something new. As the lord of the castle stands upon his high wall he hears sounds in the distance.
The sounds of axes and falling trees. Men with hammers and straining horses. He has heard of what these sounds mean.
Could it be what he most fears? A siege engine. An engine which can turn his walls into rubble.
***********************************************************

I expected a larger drop in the price of gold. The distance to $300.00 is shorter. The media mentions gold more often than not. IMHO this assualt on $300.00 plus this time will endure.

Slingshot---------------------<>cabal

The Gold never really went far. It just moved to another vault and title transferred to another LBMA member. The result was that the Gold auctions only served to diminish the wealth of the collective UK populace. All these giveaways occurred at a time when the value of Gold was low and the currency reserves were higher. Well gee whiz, that turned out well didn't it?

A socialist regime like the UK considers the Gold as assets held in trust for the people. As an American, I think that nationalism is just plain silly and I do agree that individuals who own physical Gold are better off. However, nothing beneficial was obtained for the Brit people by giving away their Gold. If anything the wealth in the Treasury decreased. In a sense - yes - "screwed, blued, and tattooed" they were. The people were played for fools. Yet, polls suggest that the majority were rather unhappy with the UK Gold giveaway from the beginning just as I am sure that Americans would be.

The ruling class has always taken advantage of the serfs. So apparently nothing has changed. This Gold giveaway is just but one example.

- Black Blade

Our thanks to Bill Murphy and GATA for this article. He's right. This is important.. . . . . . .Bill Murphy says: "The most important news of the day was hardly mentioned ANYWHERE":

--Bundesbank reject suggestion for gold, FX sales--

FRANKFURT, March 5 (Reuters) � The German Bundesbank has rejected suggestions by some
government politicians that it could sell gold and foreign exchange reserves to plug holes in the public
purse.

"That would be a breach of the Maastricht treaty and would hurt the independence of the Bundesbank,"
said a spokesman for the Bundesbank on Tuesday.

The European Union's Maastricht pact forbids member countries from holding fire-sales of assets in order
to meet economic convergence criteria.

He reiterated that last month the German central bank ruled out large gold sales until 2004, the date when
the current Washington Agreement between major economies on the orderly disposal of central banks gold
assets expires�.
----------------------------------

MK Comment: Seems Bundesbank has had a change of heart. Unlike Britain which succumbed to the political/bullion bank sector, Bundesbank is trying to hold its integrity. I wondered whether or not the Bundesbank threat to sell was within Masstricht. It appears it was not! I was going to ask FOA if he thought Bundesbank would have made this announcement under a French ECB chairmanship. My guess is that this was a test flare which blew up in Welteke's hand. There was a great deal more to this than meets the eye. In my view, this was a test of what the EU was all about. Backtracking can be a good thing once cooler heads prevail. We'll see how the gold markets react. Things appear to have been made right.

Black Blade; "Dim Bulb" indeed. The "No recession" remark is in the same league with the "You [complainers] are 60 days too late-the recession is over", 1930 remark by Herbert Hoover.

A dim bulb... HA! ...Why can't I ever draw a rich mope like THIS in a high-stakes poker game?

I think the SECTREAS may be in the ME to beg for more gold...too bad they are fresh out.

The Japanese "rally" may be over. Perhaps the corrupt government "market supporters" simply concluded that THEY ought to be recieving all that largess...no honor among thieves.

The timing of the BOE sales has been coordinated with a gradual diminishment of the dollar as world reserve currency, record gold supply/demand imbalance, vanishing gold producer hedging, accelerating world demand for investment and to cover monolithic lending, short options and futures positions and derivatives. This dollar devaluation requires staging moves, including hoarding, missappropriation and POG losses to gold mines laborers, shareholders, and customers. Political appeassement and payoffs needlessly delay reforms, needed for a new gold market and economy. US Treasury current account imbalances should have been enough to erode dollar value. Overseas investments in US securities, corporate bonds, and equities are rapidly declining. It appears the last BOE sale was designed to precisely precede "cascading defaults and the collapse of the financial system", which Anduril notes was the "alternative" for the "Brit people" without BOE gold sales.

What's the problem with the German centeral bank. The socialist have the right idea...sell all the gold and use the cash for all those collectivist programs. Just think of all the charity they could pratice with wealth that someone else produced.
But the question remains, why do the Germans or the French or the , pick your country need ANY gold at all. They all have the ECU printing the fiat. They just ask for some fiat and presto the truck backs up and...help me unload these heavy boxes. Need more fiat? Just call the ECU and ask for another truck load.
I think the reason they ALL keep the gold is that in their heart of hearts some are not sure they won't need some real money. Live small.
RJ

http://www.gold.org/finalgold/gold/Gedt/Gdt38/GDT_No_381.pdfA 24 page report from the World Gold Council in pdf format.

http://www.federalreserve.gov/boarddocs/speeches/2001/200111302/Sir uponroof posted a link to an article a while back that mentioned an interesting financial "product" called a "synthetic collateralized debt obligation." This is a product that is designed to permit the buyer to sponsor an obligation in which he "swaps" the credit default risk on some debt instrument for a premium paid. This can be done in a direct arrangement with a counterparty or can be done through a special purpose vehicle (SPV). While the concept is similar using either a direct swap or an SPV, I will focus on the SPV, in order to point out some general characteristics about vehicles, and how this concept figures into an evolving understanding of what constitutes money.

[Note - after writing this I never got back around to the SPV as such, but will leave the introduction as is because I still find the example of this kind of instrument instructive regarding their extraordinary flexibility.]

In a synthetic CDO, an entity wishing to transfer risk pays a premium to an entity set up for the task (the SPV). The SPV assumes the risk on the instrument and ties it to a reference instrument(s). If the referenced instrument experiences a credit event, the buyer of the credit "insurance" would be compensated. The SPV may sell notes to finance the swap arrangement, and invest the monies received. The SPV has no assets transfered to it. The only assets it contains are incidental (invested funds from notes sold, and premiums received). In some ways it operates like a traditional insurance operation. The main role is risk management. Secondary to that is how the entity manages investor funds, and premiums. If effective, most will benefit from the relationship, the sponsor receives protection, and is compensated if a covered contingency occurs, and investors are commensurately rewarded as well. If a credit event occurs, monies are paid from the liquidation of invested securities, and investors are affected on the basis of the structured tranches in which they are subscribed -- a senior through subordinate hierarchy.

While an SPV exists, it has form and structure, and as such, can be defined, assessed for value, and traded. When the purpose for which it was created no longer exists, the SPV is also broken down and disappears.

The chief facet of a "vehicle" that makes it important here is that it facilitates a transaction. While for instance you might have your XYZ 7% 2005 denominated in rupees, and may well solicit some institution to find some group that will do a credit default swap with you, it is awkward to say the least, and a lot more costly. If there were not some means to mediate these exchanges in such a way as to make them more liquid, these exchanges would render little impact on the financial landscape, and would mostly never occur to begin with. Indeed they bear some of the characteristics of financial barter. And in the same way that the exchange of 3 loaves for 2 fishes is assisted and made efficient through the use of an intermediary, so the exchange of unlike financial instruments is similarly improved. Not only the exchange function is improved, but the price-ability and marketability, hence its liquidity, as well.

The defining characteristic of an exchange medium is its liquidity. Certainly the defining characteristic of money also is its liquidity. (If you can't spend it, it ain't money.) The two other chief properties of money are those providing a working unit of account, and a store of value. Yet these, so far as money is concerned, are inconsequential unless the medium to which they attach is sufficiently liquid; i.e., readily exchangeable across time and space.

Some say money makes the world go round. Actually in this respect, commerce makes the world go round. Money just greases the axis on which it turns.

Something that mediates (facilitates, improves the efficiency of) a transaction, must necessarily provide an acceptable, reliable, and useful means to make account of the proceedings. It must also be capable of storing, or suspending, the value of the items being exchanged for the duration of the exchange -- as this provides predictability and stability. If an entity can satisfy these requirements, it then has the fundamental qualities to mediate exchange within its universe. Does this make it a medium of exchange? No, not at all. Not until the entity gains broad enough acceptance, and use, among the participants in this realm, can it be thought of as such.

The term "medium of exchange" is born of our traditional schooling and concepts of money. Here the medium itself serves both as that which intermediates (facilitates, improves the efficiency of) a transaction, as well as being the focus and the stuff of the exchange (dollars, beads, gold coins, etc.).

In times past it was essential to link the medium directly to the exchange as electronic settlement conducted in a networked world did not exist. The very properties that made the transaction efficient were necessarily inherent in the medium. Parties accepting the medium in exchange for some good or service would either recognize the authorizing stamp on a piece of metal or paper as enforcing its role as tender, or accept the medium's intrinsic commodity value, thus recognizing subsequent acceptability (liquidity) when they should turn around and exchange it themselves. They had to ensure the stability of these exchanges across time and space since time and space were often very long and very far apart. Since the value of the medium was intrinsic or enforceably tokenized, the natural evolution would be to think of these media as not only something that held value throughout the life and scope of their commercial use, but as something that could be kept enduringly as part of one's overall net worth. The medium became not simply a "store of value" to stabilize current commercial transactions, but a "store of wealth" that was expected to hold its value indefinitely.

Today we live in a world of instantaneous settlement. We also access and process untold amounts of information just as quickly. This allows commercial opportunities to be identified, and business options exercised with super-human reasoning and decision-making skills. Endless possibilities are opened up to find and work "a good deal." The margins may be small, but "sure," and incomprehensible volumes of assets and liabilities can move around the world with the click of a mouse. This vast and ever-increasing financial and economic activity requires a transactable medium that not only can handle the tasks, but even drive the evolution of its own usage requirements as well. I speak of more than just derived and leveraged finance. Conventional business, on a global scale, requires unprecedented versatility as well. Even as our stick-figure barter of loaves and fishes demands a tool that smooths out the process, so the movement of super-volumes of cargo across the globe, over and over and over again, also requires something to go between buyers and sellers that is up to the task.

We see the word vehicle used increasingly in the stead of exchange medium. Why is this? In the rarefied world of nuance, ideas germinate in mental petri dishes. Gametes of thought combine and begin a zygotic progression of conceptual cell-division. What is planted at the outset determines the course of development. So the fineness of degree differentiating these two terms is not the accidental result of the "twinkle in their father's eye," but a deliberate usage to define the framework of the discussion going forward.

In Mr. Greenspan's speech discussing the makings of international currencies, he states, "there are efficiency gains to channeling international transactions through a single currency, passing demands and supplies for other currencies through trades involving a so-called vehicle." The concept he is advancing is that of the international currency finding value in its use as a vehicle for exchange. The inefficiencies to the buyer of either maintaining large stores of inventory in a grab bag of different currencies in order to speed up exchanges, or uneconomically procuring the necessary instruments on the spot, with its subsequent delays, and unpredictability, are mitigated by using a globally recognized, deep and liquid unit in place of the local currency to settle the trade. This is also acceptable to the seller, as he is able to easily re-exchange the vehicle units into his local currency, or invest the vehicle units themselves, depending on his business model.

The buyer converts to the international currency, not because of its lasting wealth value, but because of its usefulness in performing his transaction. The super-liquid markets should no doubt be able to absorb his currency conversion. Likewise the seller accepts the international currency, not because it is so valuable as a wealth-store, but rather because of its usefulness in pricing his goods in terms the markets understand, and work with.

What has happened here? The exchange of some good for some secondary currency has taken place. An international currency, acting as a vehicle, facilitated this potentially illiquid transaction by transforming the objects of exchange into units of recognized, accepted account.

The hallmark characteristic of a vehicle is that it carries things from one place to another. That which has been carried from a to b has been transferred. Transferring x from a to b in return for y being transferred from b to a is an exchange. The vehicle functions as a medium in this transaction, while not itself actually being exchanged. A vehicle more appropriately therefore could be called a "medium FOR exchange" as contrasted with the term "medium OF exchange."

[Technically it is more accurate to note that the vehicle is involved in exchange, but is not the focus of the transfer, but simply the means by which the transfer is made possible. The concept is still meaningful as presented however.]

The parties to this transaction really don't care what the medium is, so long as it does the job. Whatever does the job most expeditiously will end up being preferred for use. That which involves the least hands-on involvement, or active thought on the part of the exchangers will be chosen ("one-click" buying) because it introduces the least friction and encumbrance, which translates into additional costs -- tangible and intangible.

The purpose of this outline is to give a very simplified view of the vehicle concept, not to imply that these types of structures are necessarily simple in practice, or always so one-dimensional. But as a conceptual zygote, the notion of making a distinction between "medium of" and "medium for" exchange is essential. The subtle shift from linking lasting value directly to the medium, in the stead of allowing it to find its value through its functionality is what this exercise is about. Another excerpt from Mr. Greenspan's speech:

"Because the attractiveness of any vehicle currency grows as its liquidity increases, an international currency has a tendency to become a natural monopoly.

"If the underlying demand for one of two competing vehicle currencies falters for a reason not clearly perceived to be transitory, and its bid-ask spreads, accordingly, increase relative to its competition, demand will shift to that competitor. But that shift, in turn, will widen the bid-ask spread of the faltering competitor still more, inducing a further shift of transactions to the alternative currency. This process ends with the demise of the weaker currency as a competing vehicle and the stronger of the two becoming the sole surviving vehicle."

In the eyes of U.S. strategists, the dollar maintains distinct advantages as a superior instrument in which to conduct business in the 21st century economy. Looming catastrophes in Japan, derivatives markets, and elsewhere certainly give cause for serious re-examination of the structural aspects of the U.S. currency, and its financial system, though. Undoubtedly not a few good minds are steeped in this, and very much up to speed. The complexity of the entire affair is beyond any one person's comprehension. As such, I will not venture there. Nonetheless, however, the big-picture appears to be evolving as mentioned above.

From this standpoint we may be able to discern a divergence between the evolution of the U.S. dollar and the euro. Among other things, the euro seems to be establishing a tie to freely-priced physical gold as is witnessed by their regular marking of their gold stores to the current market price. In doing this the euro seems to be seeking a more traditional model for the currency. ECB thinking appears inclined to allowing the currency to function somewhat enduringly as a store of wealth, and not simply contemporaneously for its transactional use value. This by no means infers that the bank is taking on the liability of convertibility. Of course not. Allowing their gold reserves to rise or fall in value according to the market price does affect however the basic principals of reserve banking.

Leaving aside all the esoteric issues about loaned gold, who has what, who owes who, and so on, let's just look at what a significant price rise would do to the banking dynamics involved. Should gold rise from say $300 to $3000 an ounce, the ECB in marking reserves accordingly has just expanded its lending capacity 10x without mortgaging a single euro to future productivity. ECB member banks are quickly found with the luxury of keeping conservative reserve levels, writing down bad dollar debts owed them, and comfortably paying down dollar debts owed, while most importantly having plenty left to lend into a euro-zone economic expansion.

Should the U.S. maintain its current mark of something like $45, it must then keep finding justification for further dollar expansion. As we can see from the creative and albeit quite ingenious tactics employed over the past few years, they are hard-pressed.

Can the U.S. also decide to change its policy and let its reserves be valued at market prices? It will probably have to figure out some way to do this in reality, in order to settle outstanding obligations. But leaving this aside, the effects of such an action would be quite different in the dollar world. Mountains of existing debt, contracts and allerlei derivatives are structured on the current paradigm. This paradigm is based on a premise that the U.S. maintain a perception that the dollar is "as good as gold." This is the vestige of a centuries old fixed-gold policy in economic thought. To suddenly switch gears and revalue the asset to market prices, however, would have volcanic repercussions. Even incremental price adjustments would send tsunamic shockwaves throughout the financial markets. Yet doing nothing in the face of an unprecedented gold-price increase would make out the U.S. as not knowing what to do, with the likely reaction: loss of confidence, and capital flight.

In some respects this seems to be the inevitable outcome of fiat money. And no, I don't mean the paper-your-wall-with-it kind. To mandate a ratio between gold and silver, as was done for centuries, by sovereign decree; or to establish a fixed amount of gold or silver to be the value of a currency unit, again by the declaration of the governing authority, is this not the perfect definition of "fiat money?" And so the U.S. dollar, via the current contract markets, is in the last stages of a near thousand year evolution of this concept. It is not lost on them that they are at the end of an era. That is why they are seeking to create a new thing. They have to.

So U.S. strategy must remain, in the meantime, that which permits no significant rise in the gold price at any cost. There is a resolution to be had here, though. They are not simply hoping against hope until we all die, and those not yet born take up the mantle. Looking back at what Mr. Greenspan was quoted as saying above, the intimation is that if the U.S. can still capitalize on its core competencies -- its well-developed acceptability for its hyper-efficient transactional usage -- it could damage the euro, which has still yet to attain this level of utility.

With that underway, the euro would begin to falter, and "...if the underlying demand for one of two competing vehicle currencies falters for a reason not clearly perceived to be transitory ... demand will shift to [the] competitor [which widens] the bid-ask spread of the faltering competitor still more, inducing a further shift of transactions to the alternative currency. This process ends with the demise of the weaker currency as a competing vehicle and the stronger of the two becoming the sole surviving vehicle." Couldn't have said it better myself.

So here you have miner's view of the gameplan, as seen from the back row...

Good night all...
miner49er

http://www.financialsense.com/Market/wrapup.htm
Snippit:

Still Overvalued by Wide Margin Russell goes on to quote Ned Davis Research regarding market valuations. At its peak in March of 2000, the total value of the US stock market approached 171 percent of US GDP. Currently it stands at 129 percent of GDP. When the bull market began in 1982 it stood at 36 percent of GDP when dividend yields were at 7 percent, and PE multiples on the major indices were around 7. Even with today's trumped up numbers, the major indices are grossly overvalued. To get back to normal valuations could mean the Dow would have to drop another 71 percent from where it presently stands. The Dow still trades at a PE multiple of 30 with a dividend yield of only 1.75 percent. The S&P 500 is selling at 63 times earnings with a dividend yield of 1.36 percent. In the case of the Nasdaq, there are no earnings since the majority of the companies within the index are losing money. The stock market is still grossly overvalued by any yardstick or standard of valuation. Authorities are still trying to hold up the markets by giving investors something to believe in. The spin is getting so thick that the markets are covered with a layer of fog that shows no sign of lifting. It has become a game of confidence the authorities are going to lose in the end. John Q. Public may not completely understand it, but he knows his neighbor just got layed-off, his monthly bills are going up, his credit card debt is rising in order to pay the bills, and his stock portfolio is still hemorrhaging from losses.

During the last bear market of the 60's and 70's, authorities fought and tried to prop up the markets with every tool at their disposal from fiscal spending to printing money. All that was accomplished was the inevitable was postponed for a number of years before a Middle East War, an energy shock, and a political scandal brought the financial markets down. We have the potential of the first two events becoming a reality in the Middle East and in the energy markets.


Black Blade: You know, maybe the US and Global economies weren't in Recession after all. It may have been a Depression instead. How foolish of me. Puplava gives a good run down on the days events on Wall Street and Main Street.

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Economies&s1=blk&tp=ad_topright_econ&T=markets_bfgcgi_content99.ht&s2=ad_right1_economies&bt=ad_position1_economies∣dle=ad_frame2_economies&s=APIWrFxUtSmFwYW4g
Tokyo, March 6 (Bloomberg) -- Japan faces a significant risk of a two-notch credit rating cut because the government hasn't acted fast enough to end deflation, leaving the world's second-biggest economy performing below its potential, Moody's said.

Moody's, which has cut Japan's rating three times, most recently on Dec. 4 to a fourth-ranking ``Aa3,'' said last month it's reviewing the rating on yen-denominated bonds for another downgrade. A two- notch reduction would put Japan on par with Cyprus and Mauritius.

http://biz.yahoo.com/rb/020306/business_financial_merrilllynch_report_d_1.html
NEW YORK (Reuters) - Merrill Lynch & Co. Inc. (NYSE:MER) is telling its stock analysts to use a variety of ways to gauge companies' financial performance, rather than just using the pro forma numbers highlighted by firms, the Wall Street Journal reported on Wednesday, citing an internal memo.

Merrill hopes to have the standards in place in time for the second-quarter earnings season, the Journal said. Merrill plans to focus more on numbers that are prepared according to generally accepted accounting principles, or GAAP earnings, the Journal said.

Analysts will be focusing on how cash flows compare with net income; returns on capital; returns on asset measures and the levels of receivables and inventories, the Journal said. They will also have to consider how earnings could be affected by pension liabilities, or underfunded pension plans, off-balance-sheet transactions and mark-to-market accounting, the Journal said.

Pro forma numbers, sometimes called cash earnings or operating earnings, are calculated by many companies excluding certain items, and have been criticized for making corporate results look better than they are. While many firms on Wall Street say their analysts look beyond pro forma earnings, Merrill may be the first big investment firm to adopt formal standards, the Journal said.


Black Blade: Life is about to get very "interesting" at Merrill Lynch for analysts. Now if all brokerages were to ignore Pro Forma crapola, we would see some worried looks on CNBC and CNNfn. The next earnings season could be a whole lotta fun.

http://www.baz.ch/news/index.cfm?ObjectID=E70D4D1B-BE53-4673-9FEF27A43D0A89E8&Key=Wirtschaft&KeyID=02FAED07-AC4E-423C-90C2AC226F4B680D
My german is not so good, but it sounds like the Swiss approved a proposal to sell "unnecessary" gold reserves with 1/3 of the profits to shore up their social security fund.. or something like that.

Can someone come up with a better translation?

http://www.usagold.com/hall/hallfame4.html#anchor804792...you'll want to check out the latest update to the Forum's Hall of Fame.

In it, 'niner describes in easy-to-understand terms the tendencies of financial instruments to propagate, wringing new life out of monetary systems even as they degenerate.

(click URL above)

This is my first post. I have been reading with a great deal of interest to the comments posted. Keep up the good work.

The news today that George Bush is going to raise the tariff on steel coming into the US caused some concern in Australia. US tariffs usually do that here. I don't think that this was much of a supprise.It is a direct product of the high dollar policy. It is a desparate attempt to slow the erosion of jobs in the US as a consequence of the high dollar.

Tariff policies are an effect of an economy flooded with printed paper. As I mentioned it was not a supprise furthermore their are more tariffs on their way.

Tariffs can only mean higher prices. In other words inflation will be visiable for all to see. That's when gold will really hit it's straps.

Cheers

http://www.usagold.com/gildedopinion/Jensen/20020306.htmlOPINION HEADLINE: Locked in a deadly struggle, Palestinians, Israelis share at least one thing -- despair

Excerpts:

----------...instead of the good life, Israelis live under the shadow of terrorism. Escalating bloodshed has sown despair in their society and fueled the worst recession in Israel's 53-year history. Tourism is dead, the value of the shekel keeps dropping and workers are being laid off by high-tech firms lining the highway from Tel Aviv to Haifa.

What makes young men -- and in two recent instances, women -- become human bombs? Despair, say the Palestinians. Despair that Israel will ever give them back their land. Despair at an occupation that the United Nations deems illegal but has allowed to last for 35 years. Despair at the hopelessness of a conflict that pits stone throwers, snipers and a few suicidal bombers against tanks, F-16s and Apaches.

We are besieged by the world's fourth-strongest army, they say. We are suffering state terrorism and collective punishment. Yet the world is so hung up on Israel's security, our insecurity means nothing.

Israelis echo that despair. We are a nation under siege, they say. Arab terrorists are killing our women and children in discos and pizza parlors. Our survival is at stake, so we have no choice but to fight back.-----------

Is there hope for a solution to the cycle of violence? Where to begin? Mr. Jensen continues:

------------...columnist Ran HaCohen, who writes for Israel's largest newspaper and teaches at Tel Aviv University, explains why he condemns the occupation more than Palestinian terrorism:

"Terrorism is not the occupation's twin brother," he wrote, "but rather its murderous offspring. Terrorism is horrible, but so is occupation and the former is the result of the latter. To stop the circle of violence, to stop terrorism, the occupation must stop first."
--------------

click URL given above to read this first of two scheduled summary articles, with additional photos from George Kochaniec

Well CFO of Amazon.com has resigned...hmmmn...wouldn't be worry over the books, would it????

Welcome Bullway...& yes the steel tariffs could lead to big trouble....my morning newsletter put it this way:

"A much more troubling issue is the war going on over the steel tariffs that Bush called for yesterday. Now this is going to take a bit of explaining. Our steel industry is in shambles and there are several reasons for it. In the 50's and 60's the industry was so strong and the unions were so demanding, steelworkers were one of the highest paid labors in the country. And they carried the highest benefits and highest pensions. Life was good.

But foreign competition was a problem for them. so they would appeal to the Government for help and they would get it. See, here in the states, a company has to deal with environmental issues. If their smoke stack puts out more than a prescribed amount of particulate, they have to install expensive scrubbers in the towers. If their cooling water isn't recycled and cleansed properly, they get shut down. Then there is insurance which is up 1,300% in ten years, taxes, OSHA (occupational safety and health org.) to deal with etc. Its insanely expensive to operate a steel mill in this country.

So, even when the move was to tighten the belt, move from big steel mills to mini mills and increase production, they were still getting crunched by foreign imports. why? Because in Brazil they don't have OSHA. They don't have 5 years of environmental impact studies. they don't have worker safety standards. And they pay their employees 5 peso's and a chicken.

so, you have these foreign countries that can produce the steel, put it on a barge, and sell it here for less than it costs us to just produce it. Well its killing the steel industry. so a war has been waging for years over what to do about it. The people against trade tariffs say that the industry has to learn how to become more efficient, those for tariffs say that if we tax the imported steel, it would level the paying field. After a long pause, Bush has delivered his verdict and they are going to impose tariffs of 8 to 30% depending on the type and National origin of the steel. This isn't going over big overseas.

the European union has just met to decide what they are going to do in a retaliation strike. They came away saying they want monetary recompense for the companies effected. Oy. Basically we are on the road to some form of trade war with Europe, Russia and Asia. They too will want to tax the goods we send there, to make up for the money they are going to lose with the steel tariffs. its a nightmare. Where it all ends, who pays who, what gets taxed and on and on is all just starting to be talked about. There is no easy answers here folks.

We can't determine how this impacts us as it will take a long time for all this to dribble through the system. But right now its buzzing hot, and its a political lightening rod. Why did he do it? Well there is a good case for saying Bush wants to cement the voters from steel producing states. I would have to agree with that as the reason"

That's "Tariffs and Other News"...someday I'll get the hang of my three finger typing method!

http://www.etherzone.com/Making_News_Now10.htmlFIRST THEY TRIED DISINFORMAITION WHICH IS ALREADY IN PROCESS SINCE THE ASSINATION OF JFK, NOW ITS AN ALL OUT CANCELLATION OF NEWS(WHETHER ONE SIDED OR NOT).

Thanks for that info. I am hoping Jennings, and that smug liberal puss of his gets the hook also.

The Nightline/Letterman swap is an indication of things to come. Americans are so dumbed down from years of fat, easy living that news containing nasty information is becomming boring. Look for Letterman types to be doing the news, or a funzy version of it in the not to distant future. More traction down the slippery slope of disconnect from reality.
********

@Bullway/Siochain...Steel is going to be a major issue which could bring on retalitory economic measures from the world at large. Not to mention domestic strife from the manufacturers who now must deal with rising raw material costs on top of their strong dollar handicap. Bush, besides trying to buy votes, is trying to relieve the damage of the strong dollar. That in itself is interesting and perhaps a leading indicator of changes ahead. Another consideration is the international impact. Is there a country out there that sees this as the 'last straw' and now moves to retaliate in more serious terms other than a mere WTO formal complaint? It all adds up to trouble...how much, and where it occurrs remains to be seen.

@miner49er...excellent work sir. I am going to have to read that piece a few more times to 'get it' in more complete terms. Very well written and a pleasure to comprehend as usual. I would appreciate your thoughts (brief) on the steel tariffs. Do you see any underlying motives besides votes? I cannot help but think this is beyond votes as the global fallout betrays the weight of the move. Is the steel industry that important to our economy or is there a more important reason below radar? All comments appreciated.

@Spartacus thanks for that heads up! Anyone able to translate (German?) the link regarding Swiss gold sales please try your luck. TIA

http://www.usagold.com/wgc.htmlTotal offered 12,698,800 oz (394.98 tonnes)
Total bid for 44,432,800 oz (1,382 tonnes)

Total allocated 12,712,000 oz (395.39 tonnes)

Value of total allocated $3,495M
Average price achieved $274.98/oz

http://www.usagold.com/ProductsPage.html

"Treasure chests throughout history
have been filled with gold, and not by idle choice."

-- R. Strauss

http://www.usagold.com/cpm/abcs.html

The ABCs of Gold Investing

"Gold will play a critically important role in American investment portfolios in the years to come. This book provides investors a basic education on private gold ownership from one of the nation's top experts." --Rep. Ron Paul, Texas, U.S. House of Representatives

Please Remember: It is your purchase from Centennial Precious Metals / USAGOLD that nourishes these pages.

Greetings, uponroof - when we were kids we paid attention to the Fischer / Spassky chess match. From a distance we postulated strategy, second-guessed their moves, and always claimed to have a better move for the competitors each step of the way.

So with the steel issue, it might be interesting to hazard a guess as to what the real intent may or may not be. Very practically, it naturally involves votes, as elections this year are VERY critical -- Bush cannot (CANNOT) lose ground in either house, especially if it means an outright majority to the opposition. So, while the notion appears at this level purely "politics as usual," it does have significant impact from a national security / foreign policy perspective. ALL Bush's efforts will be frustrated and stonewalled if he loses control of the Legislative Branch. I wonder how much money China is giving to Democratic pols this year...?

While I feel confident in addressing the aspects of strategic activity in the currency arena, I could not do more than offer a child's view of possibilities otherwise. Two speculations circulate about the euro / dollar affair, and the strategies involved. One is that the euro faction is playing a wait-it-out strategy against the dollar, letting the dollar fall from its own mis-steps. The other is that this whole struggle is really as important as we make it out to be.

If there is any validity to these two notions, then perhaps the U.S. might find it in its interests to stir the pot. (As I don't know the numbers regarding steel imports, this may not be of any use if they are fairly small.) Steel tariffs, while certainly having value politically, also serve to put pressure on European exports. This is just one more body blow to the euro-zone economies. The ECB has tried to maintain a detachment from the political day-to-day affairs in these economies. As long as the pain-threshold is not breached, the ECB can conduct this sort of policy without much hassle. If the U.S. successfully squeezes euro-zone steel exports, it means just that much more pain in euroland. The political pressure for the ECB to do something, like lower rates again, would be turned up a couple notches. The ECB does not wish to succumb to this pressure, but will find it increasingly difficult if euro-zone economies suffer too much.

In my last post I emhpasize what others have pointed out, that the euro currency animal seeks to be a different thing altogether from its dollar counterpart. Part of the dollar strategy is to undermine this effort, and cause the euro to react in such a way that it begins to behave like the dollar. If they can achieve that, the dollar stands a good chance of winning. The euro is not designed to act like the dollar. Decades of planning have ensured this. If it changes course, it will venture into terrain for which it is not suited. It would be like using an Airbus to give guided tours of the Grand Canyon. Being a airplane, you could probably get the job done, but gosh, it was never designed to do that!

This is just a postulation off the cuff, as I haven't really given it that much thought. Neither am I proficient in steel issues. This also does not even begin to consider the effects on Japanese steel, or China, and other Asian producers...

There's an exercise for the mind... But unfortunately I don't have time to take this one on...

Thx for reading, good Sir...

miner

http://money.cnn.com/2002/03/06/markets/markets_newyork/SELF SATISFING CONFICTION I GUESS

Your postulate that the EURO is using gold in a float is interesting. I have not to date been able to find that in print. Seems the EURO would not be a debt instrument would it not, if gold was at par a backing. If the EURO is a completly trustable fiat I can exchange all this cumbersome gold and silver of paper. I think the strenght of the EURO is in the fact that there is not huge debt associated with it. YET. It takes time for it to build up debt.
I am must likley wrong but I think the Euro is just a new pea added to an old shell game. The bankers and the polls needed more time and the EURO will give them just that. I would bet that another NEW fiat is being hatched right now.
My guess is it is for Aisa areas. The same model with a SHOW of gold with no direct exchange of course, but a large pile just the same. I have several ideas as to what "they" are up to but not any clear cut design. For sure us little people won't be included. Save ourselves...buy gold & silver. Live small.
RJ

http://story.news.yahoo.com/news?tmpl=story&cid=586&u=/nm/20020306/wl_nm/crime_belgium_sharon_dc_5BRUSSELS (Reuters) - A Brussels appeals court on Wednesday set May 15 for another hearing on whether Belgium has the right to prosecute Israeli Prime Minister Ariel Sharon (news - web sites) for alleged war crimes over a 1982 massacre of Palestinian refugees.

Lawyers said the final ruling would probably follow in June.

Though it's tough to reliably translate some of the swiss
particulars of their system, I'll give it a try:

Basler-Zeitung: Parliament offers Goldcompromise to St�nderat (Body rebresenting the Cantons in Federal Government).

Berne:
After 30 years the gold treasure of the (Swiss) National Bank should be divided by one third each to the AHV (Allgemeine Hoheitsverwaltung, i presume- i.e. likely sovereign administration), the Cantons and the Federation (of Cantons), as long as the people and the St�nde (Cantons) will not detrmine differently. The parliament has assented to this compromise on Tuesday. The only open question left, was what to do with the 20 Billion SFR, if the next generation should decide not to prolong the Swiss Solidarity Trust.

Referred back to the Federation (of Cantons)

The Federation of Cantons voted for the following ratio of distribution of the profits of the SNB - 2/3 the Cantons and 1/3 the Federation. Contrary to this (distribution)the Parliament has ruled to disburse the total capital for the AHV-Fund (Sovereign Admin. Fund) without the Cantons participation.
Finally it was agreed to adopt the 3/3rds. proposal of Ms. Lucreza Meier-Schatz (CVP/SG ... conservative Party)by a vote of 148 to 29.

- Seems to me the way to go - no sale, though give it back to the rightful owners, if not definetely to the people - at least back to more directly controlled entities.

Sorry for the bumpy translation - but hey! - I'm only a humble Austrian. Best to you cb2

Sir Miner49er has rightly posited the draconian scenario [For the dollar] of a sharply rising gold price. Thus, he sees no alternatives except to sell the last bar "At all costs" to cap nascent pog rises.

There's a problem though and it has to do with Japanese elders and their $620 Billion in savings at risk. The Treasury of the United States simply doesn't have sufficient gold to sell into a loss of insurance Japanese demand spike. At most, the US has 5,500 tonnes remaining out of 8,000. This is reflected in the $20 Billion debit book entry of the Consolidated Financial Statement 2000, note 2 found by Turk and Hepburn. This figure makes no account of the IMF NY Fed regular exports of 40 tonnes per month until recently.

As bad as Sir Eddie George's "Abyss" will be, my view is that the Fed cannot afford to sell their last bar to hold $300. When they fail to stem the rising Japanese buying [TOCOM volume is up 4.61 times Feb. Y-O-Y( opposite the LBMA trends)], there will be none left to "manage" a retreat.

Thus the competing theories are: Will there be a "Retreat" strategy or is there to be a "Suicide" strategy? Since the Master of the Universe's dominant personality trait is avoidance of decision [At all costs] the likely choice between these distasteful options is to attempt an orderly retreat.

Indeed they seem to be implementing a retreat strategy now. We were at $270�now we fight for $300...next month will we be fighting for $320?

To be sure there will be an "Abyss" as gold rises under a voracious Japanese demand spike. The elders life savings therefore have the focus of government officials in the US AND Japan....
...All the while the Euro boys wait and watch.

Just putzin' around on the 'Net, still half asleep, till I got here and saw your latest -- I'm hauling myself up out of the comfort zone and heading for a quadruple-shot wakeup coffee to bring back and sit with it -- I want to have all cylinders firing to get with this one...

Greetings, sector -- I think you have my conclusions off a little bit. Where you say that I see "no alternatives except to sell the last bar 'At all costs' to cap nascent pog rises," what I really see is that the U.S. recognizes this inevitability, and rightfully as you state, the ability to satisfy all claimants is impossible at current prices. What the U.S. is trying to do is develop a new paradigm for the currency, building on its coveted strengths of "hyper-efficient transaction utility" in the hopes of keeping the euro at bay. This is essential, as increased use of the euro as an international currency vehicle will take away much of the dollar advantage, and bring about the demise scenario. As long as their is no viable int'l currency vehicle competition, the dollar will continue to reign. (This doesn't mean they are out of dangerous waters, but they are still at the helm.)

So actually, I do see alternatives, in that the dollar planners see alternatives. Will they be successful for a while? Possibly. If it all falls apart, then you will probably see all the gold sold, but not at $300 or even $600. The workout will be much higher, so as to make it work-out. At this point, dollar holders will suffer merciless price increases, but that is just what will happen.

In the meantime, pressure, endless pressure will be brought to bear upon Japanese officialdom to restrain the public's gold demand. Maybe the U.S. could put tariffs on say steel for instance...?

cheers, good Sir...
miner

Hey Trapper, your comments are interesting. (Is the euro a new pea added to an old shell game, or just a new shell?)

I hope I am not giving the impression that the euro, or any unbacked instrument is something worth keeping as one's permanent wealth store. It need not go beyond mention that keeping the fruit of one's sweat and blood in the form of someone else's promises, and capacity to perform, is risky business. What seems to be at stake here is a dollar, extended about as far as it can go, trying to attract further use (expansion) by capitalizing on its functional value. Namely that it is usable as a reliable, deep and liquid, globally recognized and accepted medium for commercial and financial exchange. The euro on the other hand, is trying to differentiate itself from the dollar. It too needs to become this, but is deploying a different strategy. To go head to head with the dollar is useless, as it would have to undertake all the structural dynamics of the dollar, to do and behave as the dollar does. If this were the case, why use the euro when the dollar works fine?

The euro has come into being to address what became the fatal pitfalls of the dollar's policy in the past decades. This is not to say it will be ideal, or successful in the long term either. What I wish to portray is the inescapable fact that we live in a world of unbacked currency, and that this is not going to change. Therefore what are the advantages and drawbacks of the instruments we have to choose from? Where you refer to me supposing the ECB is using gold in a float, I presume you mean my correlation between its market-marking operations and its lendable reserves? If so, what this is all about, is a realization on the part of the euro planners that gold has for decades been undervalued by decreed suppression of its price. They know it can only go up, and substantially. It is not their intent, or is it necessary to make it convertible in the former sense. If you want gold however, you can go get it in the market at market prices, as much as you want and can afford. Fair enough, why should the banks socialize its distribution by managing its price?

So the ECB has a bunch of gold, say 10% of reserves. If a 1000% increase in the POG eventuates, then lendable reserves increase proportionately and gold-backed reserves are now 100% of current total reserves. Remember, these are not convertible reserves in the sense we traditionally think of vis-a-vis the old dollar paradigm. In that environment, policies that cause pressure on the currency / POG parity result in a drain of the bank's gold reserves -- where the POG is fixed. If the POG is allowed to float (and we infer this in the euro as they DO mark their reserves to market quarterly), then the reserves will function like any other bank reserves, bought and sold, lent and repaid as banking needs dictate. There is no particular need to have to have convertibility via the bank's bullion window, as institutions can buy it on the spot in the market at the same price, and as you can get it down the street at your local gold and silver dealer also for about the same (although I do suggest you use Centennial...). The end result is again, lendable reserves increase substantially. And the anticipated offshoot to this is quality and affordable funding made available for the euro-zone economies.

The next question is what is to prevent paper gold from again proliferating, and de facto setting the gold price like it does today. The simple answer is that euro-zone policy will not permit the kind of paper activity we see today. They will simply regulate it within their realm. Outside the realm the belief is that the horrendous discrediting of paper instruments in this arena believed forthcoming, will taint any efforts to rebuild Babel any time soon. (There is much more to be said here, and it is available in the FOA / Another archives. They handle these issues quite thoroughly. I could not even begin to cover it all here, and am running long enough as it is...)

True, if gold declines in value, reserves shrink, and deflationary pressures set in, but this is not anticipated They have no fear of a significant or sustained retracement of the POG once it gets going.

In the same way that the dollar has worked very hard at capping the POG for the very purpose of allowing it to remain a viable debt instrument, so the euro will work very hard at allowing gold to continually find its market value, as its very design causes it to benefit precisely as a debt instrument in a rising POG environment.

The euro in this case, for its life-cycle, will remain "trustable" currency -- but that precludes the understanding of the purpose of currency -- to facilitate commercial and financial exchange -- not to be a permanent holding of your wealth. That is what gold is so well suited for!

And contrary to natural inclinations, which we all have from our training in the tradition of money = wealth, the "weakness" of the euro is in the fact that there is not huge debt associated with it. As long as the debt is sound, the more the merrier. This is what banking is all about: lending. Viable economic endeavors funded by bank loans, and other credit extensions are how the world conducts business. The euro is doing everything it can to get more euro debt on the market. This generates the very use value that gives it credibility as a deep and liquid exchange medium.

The bottom line is store your hard-earned savings in gold. Use your investable funds, prudently -- understanding that they are not your savings. They are risk capital. Since investments are going to be denominated in some currency, take careful stock of the makeup of the currency in which your investment is named.

I hope this helped clarify my comments for you...

Rgds,
miner49er

http://www.efd.admin.ch/e/dok/ib/ib_205_gold.htmhope this helps. I gather that the sale of those 1300 metric tons is not imminent. It won't start before spring 2003. The discussion centers around the question of HOW these 1300 tons shall be distributed.

Intro from http://www.efd.admin.ch/e/dok/ib/ib_205_gold.htm :
"For many decades, legal provisions existed which bound the Swiss Franc to a gold standard. In the new constitution ..... this link binding the Swiss Franc to gold was dissolved thereby enabling a revaluation of the Swiss National Bank's gold reserves. This showed that the central bank had assets to the value of 1300 tonnes of gold, which it no longer required to fulfil its monetary policy mandate. The question then arose as to how these unique assets should be used."

Proposal for distribution:
http://www.solidarity.admin.ch/e/index.htm

miner49er (03/06/02; 10:35:02MT - usagold.com msg#: 71179)

Excellent post-should make into the HOF (for the less bright like me)

Swiss sales: they have been legally approved since long,the big discussion is now where to go with the proceeds (the politicians favourite issue).

SS is okay,as an initiative by the conservative SVP is asking for.Paying back state debt:okay too.If they only waited a few years with selling,at prices ten times higher Switzerland could pay off all state and cantons debt (which is 200billions sFr.)!!! Someone just doesent like debt free entities,what a shame to mankind.Very sad.

A word to the "Solidarity" foundation: people don't like it at all,it was a result of extortion (a word used also by a Bundesrat=one of the presidents of Switzerland,Mr. Delamuraz) by the US and WJC.Look,we are in debt like any other nation,it even grew the fastest here (doubled between 1990 and 2000).We will fight the Sol.Found. and vote it down,period.

BOE finished,Buba cleared almost the same day,there won't be any Gold sales by them.So,Gold should have a free time now for some time !?

As the lucky winner of one of the French Angels I want to acknowledge the receipt of same in today's mail and again thank our most gracious and generous host, Michael Kosares.

This beautiful coin of gold I will keep as my good luck token and unofficial membership badge at this forum.

http://uk.news.yahoo.com/020306/80/ctgfj.htmlLONDON (Reuters) - The gold market is emerging from cyclical lows, making gold miners a potentially attractive investment, according to Jeremy Metcalfe, chairman of UK-listed investment company Tiger Resource Finance

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3IN0MUGYC&live=true&tagid=IXLI0L9Z1BCAustralia reacts angrily to US steel decision
By Virginia Marsh in Sydney
Published: March 6 2002 07:25 | Last Updated: March 6 2002 07:59

Australia has followed the European Union in threatening to challenge the US at the World Trade Organisation over its decision to impose tariffs on steel imports, saying it would "fight tooth and tail" against the move.

"We're not going to lie down on this. The Americans are doing what they always do, they put their own interests first," said Ian Macfarlane, minister of industry. "The cap [on Australian slab steel] effectively puts a stop to what was an expanding market for our producers who haven't relied on government assistance to carve their place in the real world."
++++++++++++++++++++++++++++

The "roof" has it right. Seems the atmosphere of gold cooperation may get a bit more strained in the near [Steel tariff] future. Perhaps SECTREAS O'Neill is even hearing that the Kwuaitis want their 79 tonnes of gold back? There seems to be no way to view international economics without gold being involved in some manner.

And Sir '49er... the euro factor is now clearer thanks to your eyes. I wonder if there is a magic formula between gold, the dollar and the euro such that when the yen gets to X, the dollar is floated to Y with a firm link to the euro and then gold is released to Z?

http://www.investorsweek.com/displaypage.asp?id=42764Fidelity US manager seeks solace in gold
6 March 2002 11:23:00 AM
BY JULIE HENDERSON - Technology stocks are unlikely to make the big comeback many US investors are looking for and may even contract more, says Fidelity's North American fund manager, John Muresianu who has moved overweight into gold to limit his risk against further volatility.

Muresianu, who is has been well-known in the fund management sector for several years and is something of a legend to the IFA sector, is taking what he describes as a "contrary" approach and staying away from defensive stocks while markets are still unstable.

Investor unease over US accounting procedures seen in the Enron affair and IBM leads Meresianu to believe technology, financial and blue chip growth companies have yet to take a further hit.

"The market still believes in technology and expects a comeback yet I think that future earnings and modulars will contract," says Muresianu.

"Although stock prices are down, they are not down as much as the fundamentals. Finance stocks are highly overvalued and derivatives exposure will show themselves as a big problem going forward, alongside a negative bid against blue chip growth companies."

Rather than retreating to traditional cyclical stocks, Muresianu has moved the 400-500 stocks held within his portfolio to put the larger weightings in small-cap value stocks, gold and energy stocks because they act in a risk-averse manner.
+++++++++++++++++++++++++

It won't take too many more guiys like this to add up to something "Too big to stop".

Thank you Sir for a great synopsis of reality.

I'm kind'a wonderin' what's new under the sun. Having read Arthur Hailey's "Moneychangers" a quarter of a century ago - I've just seen the ole book being republished - and everything A.H. has stipulated has come to pass.

Now the book was re-published and A.H. has written 'another'
introduction ... " ... is still a timely, appropiate read, though you must adjust ... mentally to those greater amounts of money and fraud ...

... There are some who believe - and the author (AH) is one - cb2 another - that the only real, honest money that has ever existed, is based on gold. A fact that the history of centuries confirm; and even now evidence is accumulating that gold's monetary eminence will soo be acknowlegded once more!

... until then, we may undergo some more "severe" testing of our "last" stratagem, where precious few will take the cue and hold on - in severe blasphemy of reality.

... Hope to see all of you - on the other side - of paper assets - and true value - unto, I'll stop stuttering - cb2

Greetings.
I��m new to this site, to assets management and economy �Kbut I love gold-related questions and I would be really thankful if somebody could enlighten me a bit concerning the following:

a) Notion of gold-based currency as opposed to ��fiat��

I understand the advantages of a monetary system based on gold. My problem is that I only hear talking about coins and reserves of the various central Banks �V never about credit and the other ��monetary aggregates��, as we say in French (M1-M2-M3), which also belong to the daily reality.
Hence my question: as soon as we have credit, we have a creation of currency, an increase of the monetary volume �Kwhich becomes ��fiat�� in itself, because it is not backed by gold but by the assets of a debtor.
Assuming then that we have the same mechanisms as we have today, and that the only difference between our fiat monetary system and a gold-backed one is the collateral of the coins in circulation, I somewhat fail to see the difference between a crash in the two environments. Because fiat currency we have, and fiat currency we will still have.
I can imagine that one of the answers may be ��but the rules around credit will be more strict��. Ok �V this is a question of discipline �Knot gold. Why can��t we implement this discipline even before or without coming back to a gold-backed system?

Now, my ignorance has some limits, and I can well imagine that the owners of ��Reichmarks�� would have maybe felt a bit more comfortable, 50 years ago, if they had known that their papers had been backed by 5000 tons or more of gold. So I understand some the advantages of a gold-backed system. But I remain stuck on the monetary aggregates�K��

b) Inflation / deflation

Are we sure that inflation/deflation is purely linked to ��fiat currency��? I believe that that the Spaniards or Portuguese had provoked inflation when they had put the gold they had brought back from America into circulation. Inflation/deflation seems to be independent of the intrinsic value of the currency. Did I miss something?

http://www.steel.org/news/pr/2002/pr020227_imp.htmThe link will give you a quick summary of current imported steel and its impact on US domestic steel prices and volume. Having been in the business of marketing of capital equipment to the steel industry I am acutely aware of the industry's dire financial situation. Without protection I expect that nearly all of the integrated mills would be shut down within a few years. The mini mills would survive longer but no one would build new steel facilities in the US.

The US steel industry's integrated mills were mostly built before 1960 and are only partly modernized. About ten years ago I was proposing some equipment for Ford's River Rouge Steel Mill. One of their blast furnaces had been built by Henry Ford during WWI. Their power house boilers were built in the 30's 40's and 50's(one of which blew up several years ago killing several workers). Most of the Asian mills have been built since 1980 as a result of their government's providing incentives for basic steel capacity.

Big steel in the US reached its zenith during WWII and the 50's. It started its long decline when JFK denounced the steel industry price increases back in 1962. On April 10, 1962, six major US steel producers announced a sudden increase in steel prices. President John F. Kennedy was absolutely furious. He denounced the price increase in no uncertain terms. He said,

"Price and wage decisions in this country, except for a very limited restriction in the case of monopolies and national emergency strikes, are and ought to be freely and privately made. But the American people have a right to expect, in return for that freedom, a higher sense of business responsibility for the welfare of their country than has been shown in the last two days.
Some time ago I asked each American to consider what he would do for his country and I asked the steel companies. In the last 24 hours we had their answer."

From that time on there was little interest in investing in steel. It was similar to the tremendous negative impact that the "Windfall Profits" tax had on our O&G producers. Here are some factors behind the US steel industry failure
- lack of investment capital as noted above
- environmental/remediation costs for old mills
- high imbedded labor costs and inefficient work rules
- high pension/medical insurance costs
- inferior management

The raw materials for an integrated mill are iron ore, coal and limestone all of which the US has in abundance. Mini mills are basically scrap recyclers and they need a lot of electricity and natural gas for producing new steel. About 50% of US steel comes from domestic scrap. If we lose the iron-making capability of our integrated mills we will have to import about 50% of our steel.


The need to protect US steel boils down to whether or not we think that steel is a critical commodity for the strategic welfare and defense of the nation. Most industrialized nations view steel making as an important part of their infrastructure. However, it can be argued that imported steel comes from countries that are generally friendly to the US unlike much of our oil that comes from unstable areas. GW Bush apparently sees a strategic need and probably a political benefit. I tend to agree with him although a much stronger case can be made for protecting domestic energy producers. Trouble is they don't have a strong union and there's a natural antipathy towards "big oil".

Some day we'll be debating what should be done to the gold producers of this country who will be making unconscionable profits with $3000 per ounce prices. We will probably see a windfall profits tax or its equivalent imposed on them. Gold stocks will get hammered. That's why you need to have some coin.

Newmont mining (NEM) has been trading in a range for weeks now but today it broke through and made a new closing high for the year.(See Stockcharts.com) That's a real good sign since it's the stock that is being recommended as the bell-weather for gold stocks now! Real good! Yes! Real good!!!!

I also want to acknowledge this forum and Mr. Kosares for his generosity in holding the POG guessing contest. I tied with Boilermaker for the prize, and Mr. Kosares was kind enough to part with an additional 20 Franc "Angel" so we could both have one. I just received it yesterday via certified mail. Very professionally packaged. It even came with a document stating that the actual packaging and shipping of the coin was video taped to avoid any problems. I have no problem recommending Mr. Kosares and Centennial Precious Metals. Great job guys!

Greetings Tommy P,

Deutsche bank is also named in the GATA vs BIS lawsuit as one of the defendents together with JPM and Citibank - what a coincidence.

One bank rating another, therefore lifting the market and themselves at the same time - all part of the ponzi scheme called Wall Street.

Golden Bear.

Welcome, Sir, though would you be kind enough to restate your questions from the fact - either being a frankonian major domus, or better caretaker or Pippin the Minor (Le Bref) King of the Franks? The man who adopted the church to inherit the title back in the seven hundreds.

The question of gold backed currencies was answered by a steady, non inflationary currency unto 1913; The year the FED was unconstitutionally set up to undermine the gold backed Dollar - and the US forfeited their constitution since (FDR, 1934 - Gold seizure for citizens and Nixon
defaulting the Bretton Woods Agreement against the rest of the world to default the gold exchangebale $ - Standard).

Since that time there was only fiat currency, for the first time on a global basis. And if it's M'whatever monetary aggregates is not a real distinction - it's seignorage, supremacy and in the end the currency of abduction and corruption.

It's not new. When the problems culminate you just forget about free trade and introduce tariffs, as first measure to beggar your neighbour. ( See 30% on steel imports - idiotically some-one said - one saved steel employee will cost 8 un-employed service related guys ... wow, considering, almost 80% of the US GDP is service industry - and financial - derivative - show ( as in Revue') without any real Re-venue, nor ROI, nor any other employ ... the US Hoi Poloi seems to go ... the way of every other empire ... usurped by politics ... democrats beaten by oligarchs, constitution by dilution.

Ok, Pip(p)in,
Sorry for venting, pick your M's - how about MZM - you know zero maturity and don't try to exhale some co2 into the wrong balloon - cb2

It is part of the manipulation dance. I first noticed it about thirteen years ago when the first waves of smart money started to realize that the money center banks were totally out of money since they had overlent to the developers and the office building market was collapsing. The normal reaction for a portfolio manager would be to sell all the banks, but no....the manipulators knew that unless the banks raised more money the whole system would go puff. So all the investment banks and investment firms joined on a pep rally for the bank stocks and each major money center bank raised billions in new stock offerrings or convertible debt deals. The key was the the powers that be including the Fed knew that the jig was up and that the recession needed more equity in the equation and that the Wall Street firms could be counted on to pass the hat amoung the less imformed. Which I am sure it is no surprise to the audience here is in no short supply in the professional investment world. The stock issues raised needed billions and the offical problems of the real estate markets and the office buildings that the banks had leant against went unannounced for another six or seven months till even the average Joe on the street could see that the developers were insolvent. WHat else is power for? This latest rally being led by the likes of GE and Citicorp sells surprisingly similar to that period in late 1989. I hope this sheds some light on the issue. The question is can they do it again. The answer is generally yes by the way , inspite of my sceptisism. Best wishes.

http://biz.yahoo.com/rb/020306/business_financial_merrilllynch_bonds_dc_1.htmlI'm sure there's a few of you reading here that will find this news of interest.

R.

RE: Steel TariffsDear sir: I was scrambling at 4:15AM this morning trying to print your teriffic post of yesterday eve before I made for the airport. What a read and, thanks much.

My thought on the tariff issue (a momentous development) is simply that this consequence (likely unintended) is a result of the strong dollar policy which must remain part and parcel of the FED strategy you might have unmasked. A medium for exchange, despite possession of the attributes you enumerate as necessities, is inherently less valuable in that role if it is weaker relative to a competitor. Strong dollars love imports. I think we'll see more acrimony in the halls of the WTO as we move along the trail.

What has happened to the Aden Sisters? Those with a long memory with remember that they forecast gold to go to something like $3000/oz. At the time it was hitting $800/oz.
Probably they are now growing bananas in some Central American Republic.
I would be interested to know what their opinion on the gold price is today.

ANOTHER log on the currency war fire.........or am I delirious from too many airport "check ins"?

The real bite is flat rolled; that's automotive foremost I believe. GM just announced they have 1MM vehicle capacity idle. Over capacity At GM begets over capacity in flat rolled steel so mills scramble their margins and selling prices to keep their machines running. This factor combines with the strong dollar which for them is fortuitous. Also, you have the "legacy costs" of a retired steel industry in this country--onerous maybe. USS can't compete in that paradigm

Tariffs turn up the heat. Relationships strained; further deteriorate. Gold is at the heart of the matter albeit indirectly IMHO.

Or is it Down Under?
... Sir, some of us not only remember the Aden Sisters - no, we've re-met them in N.O. ... and they're back to attack
the global fiat system.

And so am I - only started the "Crashmaker" ...

So please, Sir, get one thing clear - it's not paper gold nor mining stock - it is only physical possession of the metal to save you, personally, from another Argentine.

... Will never ever invest a dime in any Aussie Mine -cb2

Isn't Lihir gold mostly sold forward? They need to hope and pray they get consolidated.

I've noticed and come to expect that gold prices drop for a few days after a British gold auction. Got to save face I guess. Show it wasn't all for nothing. Don't want to give the British press an open shot at them. It will all be old news in a couple of days. In the end the market always prevails. As long as men are corrupt, greedy, and deceitful gold will be valued.

My question is. If the Brits have sold off all but some 300 tonnes and have further leased a substantial portion, do they have any gold left at all?

I have greatly enjoyed your posts. They get to the essence of the issue and help me to see things differently.

"To mandate a ratio between gold and silver, as was done for centuries, by sovereign decree; or to establish a fixed amount of gold or silver to be the value of a currency unit, again by the declaration of the governing authority, is this not the perfect definition of "fiat money?""

Please. . . .you sound like a mine company hot dog stand.

If you want to post ads for your favorite mining companies, please contact the office and make arrangements to pay the fee -- $2500 per mining company per post.

So far your at about $10,000 worth.

If I had the good fortune to live in Argentina I would certainly buy physical gold and bury it in the garden. Either that or spend the money being photographed on the corner of Caminito in La Boca,( opposite that great little bar) with the fabulous woman who sings in the street. She probably knows more about the value of gold than the rest of us put together.

My apologies but I thought news from Down Under would be of interest to investors. In the future I will only post comments that boost the buying of physical gold.

http://www.smithers.co.uk/esnews.shtml?206An article on the European Union stability pact limiting deficits to 3%. Here's most of the short piece written last week.

"Having Germany in the corner, wearing the dunce's cap, is an example of poetic justice. It was largely at Germany's insistence that the agreement was reached in the first place.

When the euro was little more than a gleam in the Commission's eye, one objection to it was the idea that nations would go wild once the currency was introduced. When countries borrowed in their own currencies, they could not go bust. They could always repay debt by printing money. In the era of the single currency, they can borrow in euros but not print them. Bankruptcy is now possible.

There are two answers to this. One is not to worry and let them go bust if they are silly enough. The other is to try to stop them.

There is a sensible answer and a silly one. Faced with a choice on economic matters between a sensible option and a silly one, it is always odds-on that European politicians will choose the latter. Once again they lived down to expectations.

The wish of German politicians was granted and the stability pact agreed. Now that Germany is on the way to breaking it, the Commission has its knickers in a twist.

IF THE Commission had taken its duties seriously, it would have warned Germany. This would have created a political storm. It would have been very embarrassing for the German government. In addition, our own Chancellor Gordon Brown - smarting under the
Commission's previous strictures on his Budget plans - rushed to Germany's support.

The Commission was then in a quandary. It only had the support of the Netherlands, Belgium, Austria and Finland. The heavyweights were against it. On the other hand, it was worried that failure to support the stability pact would weaken the euro.

The weakness of the single currency is, of course, extremely helpful to Europe. Without it, the current slowdown would have turned into a full-blown recession. But the Commission is European enough to feel that a grasp of economics is unpatriotic. Fudge therefore ruled. EU finance ministers have agreed no formal warning will be given to Germany or Portugal, on the understanding that they will try to do better in the future.

The official view now seems clear. The stability pact is a good idea, provided it is not taken seriously. This is good news. If the world economy stumbles, higher budget deficits will be needed to prevent a painful recession."

Max: If gold rises the EU should have no trouble providing the funds from their increased reserves (see Miner 49er) and Europe could have a nice stimulus. Selling/leasing their gold reserves would be silly.

The Bank of England was reported to be opposed to the gold auctions when they commenced, but the Treasury prevailed. You ask a great question: How much, if ANY, is left? Bill Murphy states that 7% of BOE reserves are now in gold, not counting leased gold. If that's 300 tons or less, or 7% or less, it's not enough to meet Euro entry requirements. This may mean they'd need access to US gold or unreported "black gold", or mining forward contracts on future production, if euro block entry were a natural. Or is it? Some have suggested a future currency block of certain Commonwealth nations/Gr.Britain/USA. Consider the amount of control and benefits this would afford British and other foreign bankers/financiers who already own our Federal Reserve. US, Australia, New Zealand, Canada, and Mexico gold and silver mines, cropland, military/industrial assets, technology, etc. South and Central America could be included. Bankers and Britain would acquire more influence in relations with big blocks including Asia, Arabic, and Euroland.

Taken from today's FT oped pagesSnippet: A slip of the tongue by Tommy Franks, the Commander of US forces in Afghanistan, gave an unwitting glimpse at what has been uppermost in the minds of military planners.

Speaking to reporters on Monday he said: "First let me say that our thoughts and prayers go out to the families and the friends of the serivce members who have lost their lives in our ongoing operations in Vietnam". end quote

Markets up and DOW is down (again). Gold slides ( of course). Be patient. I forecast a squall in the gold market soon.

Thanks for the response, enjoyed your lucid reply. I must agree with everthing save one point. Your view that the Europeans will not in the future engage in paper gold games. You sir have much more faith than I. Greed says it all. I am sure some will put the cause ahead of natural want for money and power but some won't.
What do you think would happen to the EURO, YEN, and ETC. if the US goes belly up in any kind of a big way. The type of thing, or worse, like we had in the '30's.
Live small.
RJ

Great post. Who becomes liable if say Germany goes belly up?
A problem not completly unlike the US and it's states.

Now where did I put the keys to the truck? We need to drive over the ECB and get another load of fiat...goverment workers pay roll due next week.
Could get interesting. Live small.
RJ

Out all day. Thanks for your discussions on steel and the Swiss sale. Steel "adding another log to the fire" for sure. Good thoughts from all.

Two things stick out in my mind tonight as I get ready for another early day tommorrow. Just enough time to post these 2 tidbits which both come from LeMet.

First from John Brimlow who is alluding to the recent CB involvement and the rumors of more to come as Japan's 'cards' clearly trump and threaten all CB gold:

"...Around 4% of Japanese savings would, at current prices, buy all the Central Bank gold. Since there are no foreign currency futures in Japan, gold futures are amongst the most efficient methods of shorting the yen.

Gold's friends need this encouragement because it increasingly looks as if the Central Banks are about to show their hand in the market. Reuters quotes Paul Lee, Dresdner Bank's Precious Metals chief in Australia, as saying "I think the central banks are capping the market at $300", which would normally be an incredible indiscretion for someone who could plausibly expect to actually deal with them. Another well known gold analysts flatly asserts that the Germans are about to announce a Swiss scale selling program, and that the Washington Accord will be renewed with a higher permitted sales limit. Those carrying scars from '96-'98 will be aware that he might actually know something.

But the fact is that serious observers have been well aware of this situation for some years. The fact that the managers are going public indicates the magnitude of the problem facing them..."

uponroof-This is vindication that we are (were) right all along... and that we will continue to be right in seeing their attempts fail due to natural market forces which always, eventually rule the day.

Second from the Indian prophet Mahendra who has made some amazingly accurrate predictions of late and who has singled out gold as about to reach "historic highs"

"Dear Bill,
Many people is asking me time for zone. Moon will change NY time at 12.25. It may not go immediately up in next minutes but in few hrs we will see impact. According to me very strong rally will come in coming days. Don't sell gold. As I predicted EURO, Japan and Nasdaq is moving up slowly. Thanks
MAHENDRA SHARMA"

This guy predicted back on Sept 8 (of 2001) that on Nov 27 2001 gold would begin to rise. Just by coincidence that date was the exact low of for the gold setback and marks the bottom for the move up now underway.

He also predicts that gold will reach historic highs in 2002-3. and..."Counterfeit in the U.S. dollar which is the heart currency for the world."

Both thoughts are powerful medicine for the recent pullback doubts. Gold market behavior is undergoing change daily. What is actually happening is no longer a planned procedure from the boardrooms of banks.

All we need now is granting of 'discovery' to proceed....which btw is a slam dunk if you have been paying any attention at all (Judge Lindsey).

Cheers.

http://www.financialsense.com/Market/wrapup.htm
Snippit:

BULLS VS BEARS

It's becoming a battle between the bulls and the bears for the minds and pocketbooks of investors. This battle is being waged in the financial markets as the price of major indices rises one day, only to fall the next. Over the last few weeks the bulls have held the upper hand with the major averages recouping their losses for the year. As of today, only the Nasdaq remains in negative territory. The Dow has led the pack thanks to GM, who is projecting higher pro forma earnings this year. GM's actual earnings will be much less than their pro forma earnings, but pro forma numbers have become the new standard for reporting profits. We now have pro forma earnings and hedonically indexed economic numbers, which is what Washington and Wall Street reports to the investment public. The expectations for recovery both in the financial markets and in the economy are based on these numbers. It is a world of make believe; nonetheless, it is the new world in which we live.

Black Blade: And so it goes. Another good article. The market indices keep flying higher. I am making out well with my shares in the markets. However, this mini-bull is running on empty.


BTW, Gold looks like it might go below $290 tonight. Meanwhile the Nikkei is rocketing higher.

http://biz.yahoo.com/rb/020307/business_enron_bush_dc_1.html

Snippit:

WASHINGTON (Reuters) - President Bush on Thursday will unveil a sweeping plan to crack down on corporate executives who mislead their shareholders, hoping to shore up investor confidence after the collapse of Enron Corp., Bush's biggest financial backer in the 2000 campaign.

Bush will propose holding chief executive officers accountable by requiring them personally to attest each quarter to the accuracy of their financial statements and disclosures, according to White House documents.

To punish accounting-related abuses, top executives would be forced under the plan to forfeit their bonuses and other compensation. In extreme cases, they could be barred from serving as officers or directors for other publicly held corporations. Bush also would give top officers and directors two business days to disclose that they bought or sold company stock. Currently, corporate leaders can go as long as a year or more without disclosing personal transactions.

Black Blade: It'll never happen. The US Government is bought and paid for. I hope that these types of regulations do pass, but I seriously doubt it. This could cut into bribes �. Er, I mean "campaign contributions" (wink wink).

I echo uponroof in needing a couple more reads to see how many layers of depth in our longtime forum topics you have peeled us down to.

You've touched on one of the things I was trying to get Oro to supply figures to illuminate FOA's assertion that the USD had received new and surprising (even to the Giants) strength as a transactional medium after its 70s swoon.

How much of this is there, and does it need to grow continually to provide dollar support?

Also, the possible strategies of the Euromeisters in getting into the game and playing a new hand as central bankers as the dollar era nears an end.

CoBra(too), Cavan Man, Knallgold, Trapper and sector had their appreciative comments (which I've only skimmed yet), so I expect that someone will do the right thing by you once more.

For now, I'm hoping that your writing sparks a voyage of looking into FOA's assertions to help us understand the battle going on behind the scenes. We need this corroboration, we need multiple perspectives on his views, and we will need them especially if he doesn't return to push our understanding forward another step. We can't count on his return, so thanks for taking the initiative to get us thinking about some of the topics unique to our group.

http://www.busrep.co.za/html/busrep/br_frame_decider.php?click_id=345&art_id=ct20020306191022806C130610&set_id=60
Snippit:

London - The international gold market might not have seen the last of the UK's gold auctions, a leading precious metals analyst said yesterday. Tuesday's auction, the final in a series of 17, concluded the Bank of England's programme to slash the UK's official gold reserves by 58 percent from 715 tons. Mitsui precious metals analyst Andy Smith said that, with over 300 tons of gold holdings left, the bank could opt to resume its gold tenders in the future.


Black Blade: I hope that they do sell it all. Then I hope that the POG rises sharply while the pound get hammered as they are refused EU membership. That would be entertaining.

http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=28328035&ID=cnniw≻ategory=Metals+%26+Minerals%3APrecious&
Snippit:

Pollitt is what you might call a gold bug. He's wary of being portrayed as "a bit of a yahoo-because the gold business is full of yahoos, crazed folk that froth at the mouth." Still, more often than not, he looks on the bright side of the metal when others do not. He knows his views might be unpopular-heck, at times even dead wrong- but he continues to insist that bullion has long been undervalued. Pollitt's not the only one. "How do I put this without sounding irrational?" says Eric Sprott, director of investment policy at Toronto-- based Sprott Securities Inc., with a laugh. "I won't be surprised if gold shoots up in the $300 to $400 range this year."

Black Blade: Interesting article about bugs keeping the faith.

http://www.thisislondon.co.uk/dynamic/news/business_story.html?in_review_id=515427∈_review_text_id=479399"Shares in JP Morgan Chase, one of those heavily exposed to Enron, have fallen fast and will continue to fall far"

Thank you mikal (03/06/02; 19:30:53MT - usagold.com msg#: 71207). You have done well to expose this leader as one lost in the woods:
"Bill Murphy states that 7% of BOE reserves are now in gold, not counting leased gold. If that's 300 tons or less, or 7% or less, it's not enough to meet Euro entry requirements."

Or is the conclusion your own? Think! You have not considered the meaning of this percent. Allow for the UK to shed more paper and the number grows... maybe to 100! It is meaningless from your angle.

So, you may say, leave the percent aside - 300 tonnes alone is not enough for euro requirements. Again you and your Murphy would err in thought. Think! A child knows that among TWELVE to the Monetary Union, ECB required near 770 tonnes from these members - total! Of this how much do you think the large German membership required put in? At 30 per cent share less than 250 tonnes of its 3,700 tonnes. A net gain with EMI returns!

You expect the United Kingdom to have a EMU partnership share greater than 30 per cent???

Consider two items, in this order.

Greece had 140 tonnes prior to EMU subscriptions to ECB calling for 20 tonnes. They opened vaults for only 8 and sought remaining 12 tonnes from... the market?! You think UK cannot too buy at need, whatever the price? Think!

Consider this! ECB subscriptions require 15 per cent of the share (a euro quantity!) be paid in gold form. As gold price climbs, less weight equals required 15% price-value. Think!

Looking at a drop of several dollars days ago your Mr. Murphy said that the German announcement demonstrated failing power to affect the market. Idle words from Murphy! He cannot see that the price could have run far without this public assurance of intent to deliver. A purchase of time - the falling domino found a steady hand - for now!

Travel the world over and you will encounter no public display nearer the mark than found in comments anchoring this monetary thread tracing back over many years. Very impressive. Applause for usagold, their stewards and guides most noble knights for steadfast service in a weary business casting light to the clueless, prompting the blind to see.

http://sg.biz.yahoo.com/reuters/nsyd92845.html
Snippit:

CANBERRA, March 6 (Reuters) - Gold hedges will taper off in the next year as mining houses seek greater price exposure, Virtual Metals Research & Consulting said on Wednesday. Hedging encouraged central banks to lend more of their gold, which would otherwise have remained dormant in vaults.

"Hedging really distorted the supply/demand balance, which had a short to medium term impact on the price," Virtual Metals chief executive Jessica Cross told Reuters. "But now it is coming the full circle and you could actually see the whole thing unwinding and that becoming supportive of the price," Cross said.

In the past two years, producer hedging has fallen by 116 tonnes, Australian Bureau of Agricultural and Resource Economics figures show.


Black Blade: The day of the hedger is over. Mega-hedgers Barrick, AngloGold, and Placer Dome had better rethink hedging going forward. They could be looking at bankruptcy should the POG rise hard and fast.

http://biz.yahoo.com/rb/020307/business_economy_fed_greenspan_dc_1.html
Snippit:

WASHINGTON (Reuters) - Federal Reserve Chairman Alan Greenspan is set to testify on the U.S. economy on Thursday with markets in suspense about what kind of spin he will offer on the recent run of upbeat economic data.

Some economists think that when the Fed chief gives part two of his semiannual monetary policy testimony before the Senate Banking Committee at 10 a.m., his tone may differ a bit from Feb. 27, when he delivered the first part to the House of Representatives financial services panel.

``I think Greenspan's going to be more optimistic,'' said Greg Valliere, managing director at Schwab Washington Research. ''This economy is not going to have a wimpy recovery. I think it's going to be robust.''

Black Blade: "Come on in - the water's fine" - AG. If this is a recovery then we will see strong Oil and Natural Gas prices. That will go straight to the bottom line and yet we see no improvement in corporate earnings. Hmmm...

BTW, the Yen has strengthen strongly against the US Dollars last night. "Interesting"

http://www.mrci.com/qpnight.aspIndeed, NY Crude is higher at $23.45/bbl and Natural Gas is higher at $2.62/Mbtu. Apparently the AGA NG storage levels are falling fast and petroleum prices are higher due to talk of a recovery and production cuts. The US Dollar has fallen hard last night and this would be bad for importers like Japan but good for local goods and services. Meanwhile Gold just languishes after somewhat encouraging results of the BoE giveaway. Did we dodge a bullet and avoid a severe recession/depression or is this an illusion? We shall see in the next few months. Also, war in Palestine is heating up between both sides and talk of eminent American attack on Iraq persists. "Interesting Times"

- Black Blade

Gold and silver taking another thrashing this morning.

Can someone please explain to me (and probably others) in somewhat simple terms what is going on?

I am beginning to panic, I fear gold will break $290. Stocks have been holding up but I don't think they will much longer.

Thanks in advance.

Canuck

The end of the UK sales + Bundesbank's message (to the US) do at least confirm GOLD's explicit Importance. But there must be more !? The financial whore, US$, (sorry) must be kept operating in an ongoing trade deficit that must be cemented into irreversibility. That's why the $-lady must be praised and the euro-tramp must be dispised. Welteke gave the dollar more political value than it deserves and has done so, most probably, for timing reasons ? See POO -pressure as background. Available Physical Gold can only flow in a depressed value ambiance ! We only guess about these possible flows. How long does the US wants to extend the political backing force for foreign dollars ? And does this has to be achieved with Physical flows (or promesses)?

Bear in mind that the ultimate Euroland target is to destroy the dollar-contract-pseudo-gold-market ! The dollar-game as an international derivative on derivatives has theoretically no limits in time and volume. The dollar must remain "credible" as long as possible. cfr. First signs of outright (inflationary) protectionism (unjustified against euro-steel).

EMU "SIMULATED" CB gold-sales are a politico-/-monetary Play. POG down for dollar upgrading, running for more weight to add on the self-destruction proces. In a later stage, POG explosively up for final dollar defense (what's left of it). We are in the process of the political transition of the reserve function of the dollar to the euro alternative. This is NOT a smooth and evident event !
This happening is not recognized by any commentator/obsever.
They all refuse constantly to put so many facts into a framework. And more precisely the latest Welteke statement.
FOA : Couting the Gold is easy, but counting fiat, in it's endless credit functions and derivatives, time and again proves an IMPOSSIBLE affair !!! The difference between "use-function" and "value-function" of our money, was most surely convoluted for political gain and banking credit interest (Bundesbank-?)

The dollar's faction's war on Gold is now lost as their whole system of fiat gold creaks under a load of FAILING CREDIBILITY ! That failing credibility is being driven home as the euro system (Welteke) pumps far more dollar based paper gold into the system than their actual physical gold sales.

Gold remains freely "convertible" whilst the management organises the continued un-free "trade".
Re-read Randy's @ The Tower msg #51093 (03/30/01): The management of Gold !

Oystercatcher Mgmt. Amsterdam (Technical Analysts) :
Let Gold work off its over-bought situation !

WAC: The Brussels/Sharon thing is a flag for many cargo's.
A multi purpose action in time as well as function. The only aspect of it, applicable to this forum is the euro-link to Arabian oil with a delicate balance on public sympathies. There are other facts (Brussels), more illustrative for this. This is certainly not a guarantee for terror prevention.

http://biz.yahoo.com/rf/020307/l078995_1.htmlWe are at the 292+- floor. Looking for support. CB implied future selling is moving into market sentimemt depressing prices.

As sector posted recently....the CBs are going to have to decide to fight 300+ with every last ounce, which would mean no escape plan, or allow some of their reserves for down the road manuevering.

The fact that CBs are now so involved, (too big a fight for the houses and BB's) amplifies the seriousness. Somewhere we have to now find the strength (Japan?) to challenge and beat CB threats of more sales (see my post re Brimlow last night).

I think we are going to have a very volatile month ahead of which the down side might be a weak hand shake out. Just my two cents.

Gotta run

Good morning Trapper -

Regarding my "faith" in Europeans not to engage in paper gold. This was the same thing ORO would address. How do you keep people from playing these kinds of markets, when they are so profitable? In reality, I wonder how this will actually play out, myself. What I suggest, is that the euro folks will make the effort to regulate these markets in their favor, even as the dollar folks currently do the present markets. Areas outside of their jurisdiction will eventually find ways to do whatever they want, I imagine, but the expectation is that this will take some time after the anticipated decimation of the dollar-based contract market environment currently holding sway. In this "time" a lot of things can happen, and who can prognosticate? Probably, we will tend in the future to a single world currency as this will both facilitate global commerce, as well as hinder financial activity that behaves contrary to the policies of the currency issuers.

So as long as the euro works best in an environment of rising gold prices, regulations will foster this outcome. Even within the system, people will find ways to circumvent the regulators. So the regulators will keep regulating, and the circumventers keep circumventing, in the grand old cat and mouse game called "beat the system." Just like today.

Outside of their realm, maybe they just apply enough "influence" to the jurisdictions harboring the offending markets, that their own regulators make these markets a little less profitable? This influence does not just have to be about precious metals. Pressure can be brought to bear with just about anything, and in return for just about anything. Sound the trumpet about "human rights abuses" in mineral rich ABCLand, until you've exacted favorable trade concessions from them in return for putting the horn away. Just like today.

If the euro is at this time the chief reserve currency, euro-zone regulators will count on this to leverage their will. If oil is still what we use to light up the world, and it flows from euro-friendly countries, they can also provide assistance to encourage others to abide euro-zone regulations, where they are in oil's interests as well. Just like today.

This is nothing new. This is what all ruling factions do while they have the scepter. The U.S. has used the IMF to promote its own interests across the planet for decades. I have no reason to believe that this will not be the same with Euroland as well. They will have their own IMFs to influence policy across the world. They will make recommendations to various nations on how best to develop their economies, structure their governments, etc., and provide rewards (e-z loans, grants, military aid) for compliance, or punishments (sanctions, divestiture, military action) for those who don't go along. Just like today.

This is one of the main reasons it is the coveted jewel to be the issuer of the world reserve currency. It allows you to impose your will. That is why I don't think it's really so much a matter of "faith", that I conceive the plausibility of Euroland's controlling the operation of contract precious metals markets in the future, if they are at cross-purposes -- just as they should be able to influence, control, or manage other externals to their realm. Not forever, but for its season. It is just part of the human condition as shown all through history.

I also don't wish to make out that everyone is sinister. On an individual basis, people do things consciously and unconsciously that promote the things they believe in, and ultimately this finds itself in things that benefit them. When a collection of individuals acting for a common purpose (a government for instance), move together, the behavior is magnified out of human proportion, and can appear monstrous. Hence the perpetual metaphors of states and nations as "beast," "leviathan," and so forth.

There are certainly evil people, and evil ruling forces. There are also good people with beneficent designs. I personally make no judgement on any individual in either the U.S., or in Euroland as far as their intent. Only God can do that. What I wish to observe is the collective manifestation of the synthesis of all these participants: good, bad, and opportunistically ambivalent on the world stage. And the analysis suggests that there really isn't anything new under the sun...

Thx for reading good Sir,
miner

A 2 cents (eurocent that is) guess of what might be happening, without reason for panic :
TA (TI) strongly suggests that euro is in the process of strengthening against the US$ !? The critical juncture (price-pattern-abcde-triangle) is pierced on the upside in favor of the euro. Automatically the US$ responds with more (endless) paper-gold-contracts ! Rightfull selfdefense sir ! That good old same reflex with more than 30 (70) years of age. Thanks Welteke for your (temporary) help.
Yes, goldmine holders (traders) might have reason(s) (again) to panic (?) for having shifted their etherical profits (once again) into Physical. You (any now many others) start to know my (FOA/A/CPM) boring mantra on this.

Compare the 2 year (+) pattern on euro/dollar bottoming chart and POG-bottoming chart. Similar, isn't it. A DIRECTIONAL MOVE is still in progress ! And why not A TEMPORARY up move in tandem for euro+dollar+Gold ? I am not trying to blow cold and hot simultaniously, but it are those GIANTS who do observe political will and its critical mass, for making their (the) decisive move. All other arguments are just noise, confusing noise.

Let them talk...talk...talk, about this economy that isn't ! Let them hide...hide...hide the building hyperinflation that is ! Don't lose your pants and shirt in the process, dear knight. Regards.
BTW : Harmony (HGMCY) is the FIRST goldmine that bluntly states that the best (one and only) support for Gold is actually : PHYSICAL BUYING ! That does makes sense to me...and you ?

Thanks for the words of encouragement.

I expect a very shaky month and look to volatility going into 1Q02 earnings (mid-April). I suspect we will see the 'real effects' of the 'Enron-thingy' and the Japan issue by then.

I hope I (and others) are looking at this the right way.

http://www.busrep.co.za/html/busrep/br_frame_decider.php?click_id=345&art_id=ct20020306191022806C130610&set_id=60Smith is at it again....innuendo etc...yup...this is going to be one doggone fight....trying to shake out weak hands,,,and slow/reverse gold direction....definitely looks like no holds/lies barred

(Intro)2FA77D9
Reuters
March 07 2002 at 06:34AM
London - The international gold market might not have seen the last of the UK's gold auctions, a leading precious metals analyst said yesterday.

Tuesday's auction, the final in a series of 17, concluded the Bank of England's programme to slash the UK's official gold reserves by 58 percent from 715 tons.

Mitsui precious metals analyst Andy Smith said that, with over 300 tons of gold holdings left, the bank could opt to resume its gold tenders in the future.

"The fat lady [of Threadneedle Street] may not have finished singing. Least transparent of all is why the music should stop at 320 tons left in UK gold reserves," Smith said.

"The question is: 'is this really the last UK sale?' The flaw in the so-called transparency of auctions is that the choice of 320 tons left in reserves after the auctions is completely opaque," he added.

Before Tuesday's auction a treasury spokesperson said there were no plans to hold any more sales after the 2004 expiry of the five-year central bank Washington accord, which capped sales at 400 tons a year......

Thanks for your fine postings of recent, Sir !

The euro exists and will therefore keep on competing with rivalling US$ ! This rivalry has many aspects : monetary, geo-political and economical. But GOLD will always be inevitably "strongly" involved in this fierce competition ! Not as the good/bad/ugly thing but rather a strive for natural dominance. All tricks are permitted in such a game/play.
That's why Physical is and will remain the most safiest play for us as lilliputans. All other ventures are expeditions with the usual risk/reward fluctuations.

Thanks.

I have anticipated a drop in the $ over next 60 days....but I also have long thought we would move to perhaps three spheres of influence.

There is too much riding on the dollar to let it drop too far in favor of the Euro (Ok..we shall see what oil does...but I wouldn't put it past war/occupation to preserve relatively cheap oil in US)

Perhaps an intermediate step will be a three hegemony of Europe...the Americas (yes Canada/Mexico etc)...and Asia.

Hey buddy, why am I getting the impression you're trading short term paper again?

DON'T! Buy the hard stuff. You'll sleep better. This is a long term game.

A few months back gold was 270 and silver 4.03. 290 and 4.44 are fine when looked at with the right perspective.


Miner 49er, Belgian, others, thanks for all the work. Still rereading posts - great work.

Re: Steel tariffs. Might be as simple as war. You cannot fight a prolonged war without a steel industry. Especially when it appears we will be alienating most of the rest of the world fighting it. I just can't imagine Bush bending to the steel industry only - why not auto's too? Something big this way comes - or already has and we just don't know it yet.

Pizz

http://home.europa.com/~blugene/deficit/debt.htmlThanks for your answer, Cobra2. Concerning your question:

<>

...Neither of them, I'm afraid. My reference is the Pippin of the "Lord of the Ring" (in the french translation - you may have a different name in english), a little Hobbit.
The one who made all those stupid things and made Gandalf furious so many times.
But above everything, the one who gazed into the wrong sphere...

A last question till next time :-) : is the figure indicated on the site above real and up to date? I believed that the question of the deficit had improved so dramatically that the money could be re-allocated (against Mr Greenspan's opinion, btw) ?

Tnx again.

Looks like big money coming out of US paper. Bond broke 100, dollar down, CRB gapped up, Oil up a buck, and Gold holding, firming even with all the negative press.

Gettin' REAL interesting.

Pizz

Is gold slowly dropping back to $280 level?

http://cbs.marketwatch.com/news/story.asp?guid=%7B64D44CA5%2DB115%2D48CF%2D8982%2D1ED08AED6A3D%7D&siteid=mktwPart:

On currencies, Lane sees the dollar "tracing out a top." The dollar this week has lost an astonishing 5 percent against the yen and is fast losing ground against the euro. The almighty buck may be nearing the end of a 15-year bull run.

Lane and his team are taking a look at gold, the most unloved investment on the globe. "Everyone hates it but it is migrating higher. With interest rates heading higher and the dollar falling, at some point down the road, maybe because of Fed over-stimulation or fiscal distress, the market is betting there will be inflationary pressures," Lane says.

"People will do very well in the next six to 12 months in the gold sector,"

Should get really interesting from here!

Too much corruption in the ranks for any justice.!!! How sad things have become, for those who are able to see!

I'm certainly no expert in manipulations of gold....but I see this as a shake-out. The Big Boys do expect gold to increase this year....they need to buy low.,,and cover shorts. The small buyers/sellers are being spooked ....plus money is wandering around in search of a place...not bonds...not US markets....well lets close off gold from them ...& that's what it looks like. I see this as opportunity to pick up some hard gold.

"To mandate a ratio between gold and silver, as was done for centuries, by sovereign decree; or to establish a fixed
amount of gold or silver to be the value of a currency unit, again by the declaration of the governing authority, is this not the perfect definition of "fiat money?"" Miner49

If I'm reading (and thinking) right about this free Gold,not allowed to be called money again by the governement;the euro paper just offered as a humbly,more convenient medium of exchange for day to day transaction:

Will we,the people,finally,get our OWN money,liberated from any governement fixings???

http://biz.yahoo.com/rf/020307/wbt262886_1.htmlAnyone care to explain the recent trend breaking going on with the dollar and yen? Does it have anything to do with gold's weak performance?

If I follow Greenspan correctly he is saying the dollar losing value is due to repatriation. If that's the case, and our domestic markets are running nuetral to bullish lately, what does that imply when the bear returns.

Oh I know...if the US markets turn down the foreign markets will also, losing ground, killing the incentive to repatriate....

Don't bet on it! The dollar's time is up IMHO.

Seems to me some major changes may be upon us. We shall see.

http://biz.yahoo.com/rf/020307/nat000195_1.htmlAll thoughts and opinions greatly appreciated

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&T=markets_bfgcgi_content99.ht&s2=ad_right1_topfin&bt=ad_position1_topfin∣dle=ad_frame2_topfin&s=APIekohUVWWVuIEhhSnippit:
"The yen had its biggest gain against the dollar since October 1998 as a surge in Japanese stocks spurred demand for the currency.

Investors drove the yen to its strongest level in 2 1/2 months as government efforts to boost shares pushed the benchmark Nikkei 225 average to a seven-month high. Japan is engineering a stock rally before the country's fiscal year ends March 31 on concern that recent declines in shares -- the Nikkei fell to an 18- year low last month -- may bankrupt banks, analysts said.

The currency was also helped by speculation Japanese companies may sell overseas assets to bring money home before they close their books at the end of March, said investors.

``This is not the time to be buying yen,'' said Sinche. ``Nothing fundamental has changed in Japan'' in terms of the strength of the economy, he said.

The dollar fell against the euro and the Swiss franc after European Central Bank President Wim Duisenberg said the decision by U.S. President George W. Bush to impose tariffs on steel imports ``may have something to do with the exchange rate of the dollar as it is experienced by its steel industry.''

Waverider: Interesting day on many fronts - the Japanese PPT may be effecting a change in investor sentiment that will probably be blown out of the water come April. The yen is likely being repatriated as March 31 approaches and on fears of rising interest rates in the US, but maybe also in backlash to tariffs on steel (US dollar is down against European currencies for same, as above). Oil shoots skyward today on increasing ME tension and fears of an Iraqi war. BUT...Gold did close over 290.00 - did Japanese sell off Gold today? As Mikal said weeks ago - expect volatility in the POG, and expect it to get worse...just hang on for the ride!

~Sir Miner49er - thank you for your brilliant exposition on the dollar/euro - a very pleasurable read, and reread for depth and breadth. It's a privilege to learn from you Sir! Cheers!

From one analyst:"as liquidation of long positions was seen in both New York and especially in Japan. Such liquidation is due to the apparent dissatisfaction of buyers in the market with gold's inability to cross the $300 level even when the USD appears to have broken down significantly. However, there appears to be good physical demand emerging from commercial and industrial users as we approach technical support levels. I would guess that the recent lows will hold but that any considerable rallies will have to wait until at least next week.

Even though the decline of the USD against almost all foreign currencies has been a supportive factor for gold, the large advances of global stock markets has moved the precious metals out of the spotlight for now. The psychology of the market has shifted quickly and the gold and silver markets seem on the defensive, with recent investors selling while the industrial and commercial interests are buying." (note those last few words!)

Additionally.... it looks to me as if Japan is pulling out every stop conceivable from banning shorts etc....the end of March is critical for them....they cannot allow the banks to fail thus have decided on the strategy of propping up the market any way they can....I would expect this to be cosmetic that cannot last but will cause a lot of damage now and after...JMO

"speculation Japanese companies may sell overseas assets to bring money home",,,,I recently posted a note based on talks with my brother...and his Co (BIG) is picking up Japanese assets right and left

This is I believe part of the plan to escape the 3/31 pending catastrophe...or rather...buy time

http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=206679
If the recession's almost over, why are CEOs so anxious and investors so confused? One word: earnings.

Snippit:

The recession of 2001 was supposed to be nasty. You remember, we said so on the cover of FORTUNE in October, and so did a lot of other halfway-reputable people. But guess what: It may already be over. That's what the economic data are saying. It's also the opinion of virtually every economic forecaster out there, including Alan Greenspan. If the economists are right, the recession will not have been nasty at all. Just short. With only one quarter of negative growth (-1.3% in the third quarter), you could even argue it wasn't a recession, which is generally (although not officially) understood to be two straight quarters of GDP contraction.

But try telling that to the folks running America's corporations, who are as gloomy as the forecasters are cheery. Though it's up from the record lows of autumn, FORTUNE's Business Confidence Index (compiled from a monthly poll of financial executives) is still mired deep in recessionary territory. "We are not seeing any improvement,'' says John Dillon, CEO of International Paper and chairman of the Business Roundtable. Clearly the melancholy in executive suites is shared by investors. Since the post-September rebound petered out in January, the stock market can't seem to string two good days together.


Black Blade: Exactly!!! A lot of fantasies are dancing around in the heads of Wall Street Pimps and Media Trolls. Perhaps they simply can't see the forest for the trees. It must ultimately come down to profits and if there are no increases in profits, then there will be a lot of disappointed people this coming "earnings season".

Is getting creamed. The markets get curiouser and curiouser.

Let's see if we can get two plus two to = something useful.

Bonds down.

Yen up.

Japanese stock market up.

CRB up.

Let's see. . . . .

Maybe Koizumi went for the "devaluation thing" during GWB's recent visit???

With thanks to our own George Cooper on the analysis. (Japan selling bonds, buying own markets, reinforcing own banking system, driving up yen. In a word, "repatriation"

Open question whether or not it is with or without the Bush administration's blessing given the "steel thing."

Could be the start of something major.


Maybe we can get GC to post about it later. Watch for MarkeTalk. . . .

Gold down.

But we don't think for long.

BOE liquidity still wending its way through the gold market system. Could get interesting fast when that's over. . . .

MK: The sharp drop off in the dollar and the action in the bond markets; doesn't that volatility have the propensity to wreak havoc with OTC derivatives a/k/a investment esoterica?

Yes, it does. If this is a quantum shift (too early to tell, but it looks like that could be the case), you could see a mad scramble as all sorts of positions are covered -- from commodities, to bond positions, etc.

Pizz, can you some shed additional light on the situation per CMan's question?

Welcome to all the new posters. Randy tells me European registrations are way up. A hand across the sea to all our fellow goldmeisters from the EU. . . . . . .

Rumors have it that Saddam Hussein has converted a number of humanitarian aid donated trucks into missile launch vehicles, despite Iraq's recent apparent willingness to go along with UN inspectors. So far in discussions, Iraq has responded reasonably well to suggestions that UN investigators would be interested in entering the country for the first time in two years to do weapons inspections. Allowing inspections officers into the country will be based on the condition of lifted, or completely suspended sanctions.

RobotGuy- Something seems a little weird here. Iraq seems to be a little too complacent. Obviously they've found some really good hiding places for their long range chemical and biological weapons. Unfortunately space satellites cannot observe all that is going on in IRAQ's massive cave complexes. Thermal resonance imaging is quite vague when it comes to underground observation, especially if the active manufacturing areas are underneath civilized areas. I wonder.........

http://biz.yahoo.com/bw/020307/72145_1.html

Snippit:

WASHINGTON--(BUSINESS WIRE)--March 7, 2002--Average U.S. monthly natural gas spot prices for March rose 18.75% from February, to $2.28/MMBtu, as cold weather swooped into the South and East, and forecasts for tighter supplies later this year fueled stronger price expectations, according to data released by Platts, the energy information, research, consulting and marketing services business of The McGraw-Hill Companies (NYSE: MHP).

``A number of factors combined to inject a jolt of bullishness into the March market,'' said Kelley Doolan, natural gas market specialist for Platts and chief editor of Inside FERC's Gas Market Report. ``Many areas of the South and East that have not seen much winter this year finally got a shot of seasonable or below-normal temperatures this week. Additionally, there were a number of analysts' reports issued in late February that projected a strengthening of prices in the second half of 2002, largely due to anticipated production declines and a rebound in gas demand as the economy improves.''


Black Blade: Apparently natural gas supplies experienced the sharpest weekly decline in inventory in 8 years according to the AGA. This is on top of very high withdrawal rates that should drop excess supply rapidly over the next few months and with slowing production and exploration. Another "Energy Crisis" could be in the works. Currently the NYMEX spot is $2.79/Mbtu.

http://www.gold.org/finalgold/gold/Gedt/Gdt38/GDT_No_381.pdfCanuck (03/07/02; 04:41:43MT - usagold.com msg#: 71223)
What is happening?
Gold and silver taking another thrashing this morning.

Can someone please explain to me (and probably others) in somewhat simple terms what is going on?

. . . . . . . . . .

Canuck

One thing that is happening is that we all seem to fall back and think that the spot price of gold today has a lot to do with the "value" of gold.......does a 3% drop or rise in price change the number of coins you have?

Another thing is that a single day does not a year make.....in the link above on page 18 there is a very nice graph showing gold price in 2001.....for all of last year, $290 would have been big upside news....take a peek.....

Poor old Solomon

Japan:
1. Banking system "technically insolvent".
2. Debt/GDP Ratio unprecedented
3. Interest rates near zero; deflation rules.
4. Yen rising strengthens and equities explode.

USA:
1. Enronitis manifestations
2. Equity valuations at extremes.
3. Dearth of capital spending and savings
4. Culture of debt and another credit expansion.
5. Equities in bull market and dollar tanking

I am leaving out a lot got to run.

It has been some time since I last posted my thoughts. I have been watching the markets and events unfold each and every day. Today's action in the currencies (US Dollar and Japanese Yen), bonds, stocks and commodities leads me to believe that we stand at the precipice of a multi-year bear market decline in the US Dollar. I have been ruminating and cogitating on all of these matters and how they interact with each other. I have the benefit of access to many excellent sources of market intelligence (phone calls and newsletters)--some of which is conventional and some unconventional. So here is my analysis in a nutshell.

The markets are entering into a very dangerous time where economic dislocations and systemic failures can be expected. From a technical standpoint, a muti-year cycle in the US Dollar is due about now, roughly between March 15th and March 31st. This will be the top in the value of the greenback for some time to come--maybe forever. You can come up with a myriad of fundamental reasons such as: the phoney budget surplus under Clinton and Rubin; deficit spending by Bush due to the recession and post-September 11th attacks; introduction of the Euro; Enron scandal and fraudulent accounting practices, etc. Whatever you believe to be the reason, that is fine. I watch the charts and cycles which tell me WHAT and WHEN. WHAT is the US Dollar and WHEN is NOW. From a purely historical viewpoint, Caesar warned about the Ides of March (March 15th). So there it is again. One caveat however: cycles are not perfect, especially if everyone is watching and taking action. So we need to allow slippage of a week or so, which means today's market action may have signalled that the top is in.

Just a few other dates to keep in mind during this time period: March 19th is the FOMC meeting and release of the US Trade Balance (deficit); March 20th is the first day of Spring; March 27th is Passover; March 28th is a full moon as well as the release of the final numbers for 4th Qtr. GDP; March 31st is Easter (symbolic of resurrection and new beginnings); April 1st is the new Japanese banking regulations. It is difficult to find another time period of the year where there is a tight clustering of dates and events which coincide with cyclic turning points.

So back to today's market action. We have known for some time that Japan's financial system was in trouble. Report after report, new prime minister after prime minister, have talked about reform. But the stark fact remained that years of bad debts were being carried on the books as the recession dragged on and deflation strengthened its grip. I find it more than interesting and more than coincidental that George Bush timed his visit to Japan two weeks ago just before the markets are set to break down. In my humble opinion, it appears that Koizumi and Bush talked about Japan's problem banks and how to resolve them. I presume that they (or their financial people) discussed Japan's holding of $400-$500 billion of US Treasury Bonds.

From today's market action, it appears that Japan is selling off some of its US Treasury holdings (which is priced in US Dollars) and converting it into Japanese Yen for immediate repatriation to shore up failing Japanese banks. How else can we explain the fact that US Treasury bonds dropped almost two full points today while the US Dollar dropped 120 points to 116.80 and the Japanese Yen skyrocketed 236 points to 78.84 (March futures). At one point, the Yen futures were up 40 more points to 79.20. The laggards were the Swiss Franc and Euro, which are usually the most active. And we cannot forget to mention that US stock markets were down while the Nikkei 225 was up 185 points to 11,765.

All in all, the evidence points to a fundamental shift from a strong US Dollar to a weaker one. Given the crushing debt loads of government, corporations, and consumers, it appears that the financial powers have decided to allow inflation run its course and inflate away the problems. Of course, inflation has been evident in stocks and housing for some time, but those two items are politically correct inflation whereas price inflation and higher gold prices are not politically correct. Thus, the constant "tinkering with" and outright fraudulent manipulation of the various inflation indices (PPI, CPI, etc.). This conclusion that inflation is making a comeback can be seen in today's surge in the CRB Index to just under 200--after putting in a double bottom at 190 just a couple of weeks ago! The only laggards in the CRB today were gold and silver. Gee, I wonder why that is?? Could it be that cabalists,JP Morgan and Goldman, are doing what they always do?

In conclusion, we will look back at this time and kick ourselves about not buying more gold and silver at these ridiculously cheap levels. I don't believe JPM Chase or Goldman Sachs will be able to keep gold or silver under control while everything else is moving up big time. So once again, I appeal to the reason of all my clients--whether past, present or prospective--to take stock of this situation and to ACT. Mark my words: Once events begin to unfold with rapidity, you will not be able to get through to us here at Centennial. Even though we installed a new telephone system last summer, the volume of calls after September 11th made it difficult to get through. I anticipate the same thing will happen again. And God help us if any terrorist event occurs (nuclear or biological) in New York or Washington, D.C. Gold will skyrocket so fast it will take your breath away. You don't want to quibble over $5.00 here or there when gold jumps $100 in a single day. It can happen and it will happen some day. Count on it.

GC

The contineous -"Building"- upon a -"Stable"- debt *System*
with -"Locked Down"- Gold prices ! (TG)

Building = 1933 >>> 1971 >>> 1980 ...70 years of different management styles in Gold Manipulation / Price Fabrication.
Stable = A political Gold market with no alternative.
Debt = More fiat for less goods/services.
System = Systemic and not responding to natural evidencies.
Locked Down = The only status wherein all this is possible.

*This* and nothing else is the sole explanation of Gold's behavior/fluctuations for the past 30 years and present. For as long as not one single main-stream-media, finance-analyst, is capable of writing down this conclusion publicly...we keep on waisting time with all or any attention given to these media. And the total lack of any *serieux* (seriousness) is evidence for the steady advance towards total collapse. Bedtime for Belgian hobbits.

http://www.thestreet.com/markets/aarontaskfree/10012168.htmlHEADLINE: Greenspan Is Ready to Turn On the Inflation Machine

Aaron Task writes:
-------------...what if, rather than planning to squash inflationary pressures, Greenspan actually hopes to foster them, as Paul McCulley, managing director and chief economist at PIMCO, recently mused.

Greenspan "wants aggregate demand to firm sufficiently for companies to be able to 'take back' prevailing price discounts," McCulley wrote at PIMCO's Web site. "That's the 'take back' that is on his mind, not the bond market's fear of a 'take back' of last year's easing."

McCulley cited comments by Greenspan in his Feb. 27 congressional testimony that "part of the reduction in pricing power observed in this cycle should be reversed as firming demand enables firms to take back large price discounts." The following day, he noted, during a speech before the Labor Department, Greenspan discussed savers' appetite for risk and the long-term outperformance of equities vs. "less risky" securities.

Simply put, "Greenspan wants stocks to outperform bonds in the quarters ahead, and he's willing to underwrite a cyclical increase in inflation to bring about that outcome," wrote McCulley, who was not available for additional comment.--------------

In an earlier article, he also wrote this. Note the final thought:

---------- does the Greenspan Fed try to manipulate the markets, i.e., the Greenspan Put? Few serious Fed watchers would say it does, but "markets move on the relation between perception and reality," according to Woody Dorsey, an expert in behavioral economics and president of Market Semiotics. That many investors believe a so-called "plunge protection team" exists may be as important as whether it's fact or myth. Such beliefs may explain why many investors rode the markets down in the past 22 months, and why most continue to have faith in the stock market, and in Greenspan.

...most critically, the issue at hand is that the market hasn't cooperated with monetary policy for the past year. A lot of attention has been given to the failure of equities and long-term interest rates to respond to massive Fed easing.

Furthermore, the Fed has pushed the "real" well below 0% in an attempt to prompt investors to take money out of saving accounts and put it into the market.-------------

When zero interest rates weren't enough to do the trick in Japan, we now see reductions in bank deposit insurance come along to stimulate a move of money into economic participation. Wisely, the Japanese people have turned their minds toward gold.

It cannot be stressed enough. The Fed knows that money must flow like oil to lube the wheels of an economy, and further, simple money sitting in an account belonging to Ma and Pa American has big-time exposure to risk of losses in purchasing power -- particularly if foreign holders of massive U.S. bonds choose to liquidate rather than riding losers into the ground.

Move your money you must, but it comes down to this -- you can opt for stocks (thus rolling the dice on a future "Enron"), or you can opt for the tangible goods and hard assets that are at the very foundation of civilized life. Also bear this in mind, for it's a key issue: among the various non-corporate real assets, gold is the one best-suited to preserve liquidity -- an economic "wheel", so to speak, that is interchangable for monetary "oil" when needed. They know this in the far corners of the world. Now you know it, too.

R.

Sir George, you've penned an interesting scenario to which I would also subscribe. Though, haven't we seen these kind of turning points in the past and miracleously the turns returned to the old script of the play.

I'm not much of a TA guy, though it's been the craze for so long that I'd love to see a real, visible and established trend before joining the parade.

On a fundamental basis the "Turning Point" was hideously delayed and I would think you'r timing may be right.

One facet, which may speed up the process is the tariff on steel. A fact, which has infuriated all trading partners and may lead to severe repercussions. Wim D's. remarks left nothing to speculation as he openly critisized the strong Dollar policies in view of the structural indebtness of the US - internally and externally. (- Also (forget the author), though some bright analyst felt that every job saved in the steel industry will cost 8 jobs overall.)

Seems the old game of beggar thy neighbor has started in ernest again.

And just another thought, as most of the world's economists are becoming positive - just heard most of EU's forecasters see at least 2.5% growth in the second half - I'd have to ask - On what basis? Based on the latest set of economic numbers, relative to what fundamental BiaS seems more the construct of wishful thinking.

In conclusion, just let me quote a line from a recent essay by my favorite economist:

"The worst part of the bear market in stocks is still before us, and it will essentially involve the wholesale destruction of the pseudo-financial wealth that the bubble economy has created in the past years."
Dr. Kurt Richebacher

For gold - tomorrow may be a crucial day as the bigwigs tried hard to pull all stops below 290. I feel gold will come back in a big way - soon.
Regards cb2
PS - sorry didn't find time to respond today and will be away skiing for a week.

Special thanks to MarkeTalk for the post earlier. I believe you nailed what my scrambled brain has been thinking but could not piece together.

A post sometime back by an occasional poster stills sticks with me. He (she) mentioned that with all the money pumping into 'the system' it's sometimes hard to pinpoint where 'inflation' will occur. In 1999/2000 it was very easy to see housing and the SM's flying high, 'good inflation' if you are a stock holder and house owner as MarkeTalk reminds us today. The 'moneymakers' want inflation 'channeled' into 'good things'.

Another poster again some time ago mentioned that the massive sums of money injected into the system in the last year (to two) intended for the same targets were lost 'to money heaven' with stock markets loses. The money injected to revive stock markets (and thus stock market confidence) was lost, resulting in 'no inflation'. This is perhaps a far too generalized viewpoint but stay with me.

So a month ago Bush heads off to Japan. Everyone watching this from a distance knows full well that the US has been up Japan's butt to inflate, inflate, inflate. The Nikkei after trending down for such a long time suddenly turns on a dime and I mean a dime, and is rising for no good fundamental reason whatsoever. The world markets keen to follow and sensing the abrupt 'political' change are charging at warp speed.

Now in the last year or so I have very keen on watching the price of gasoline in town. I commented recently that I have puzzled by the 25% back and forth pricing between 48 cents and 61 cents per litre. Today the price is 64.9 cents, gasoline has broken trend, look out, watch for it. As BB mentioned NG is up snartly and MarkeTalk mentioned the CRB is 'a cruising'.

The economy is still hurting fundamentally, there are dozens and dozens of articles debating the fact whereby P/E ratios are out of whack, earnings have not and are not improving, CEO's don't see the recovery yet the FED is pushing, pushing.

We have the (escalating) war(s), the accounting problems, bankrupt countries (how many now) and blah, blah, blah.
Japan and presumably others are 'channelling' money into gold, "can't have that" says the manipulative CB's, must 'channel' 'money' into 'productive' things, must redirect inflation.

I agree with everyone today, thanks for the notes. I personally have a six/seven week window where I am going to watch 1Q02 earnings and repercussions out of Japan. April is going to be a wild month. IMHO, Japan and the US have 'teamed up', maybe with or maybe without each others sincern trust, and have decided to inflate away. It will be interesting to see who is on board, Europe, Asia, the ME?
It also will be interesting to watch if the inflation 'channels' to the intended target.

Watch the CRB.

Indeed, I thought it quite coincidental that the Nikkei 225 would stage a dramatic turnaround shortly after Dubya stopped in Japan and the Finance minister was summarily fired. Also the US Dollar has fallen rapidly which led me to believe that Japanese interests were calling home their dollar denominated investments. Yet the Nikkei 225 still rises higher on no real positive news. It appears that the new Japanese PPT is using some of the funds to stir up confidence in Japans failing financial system and probably to prop up the insolvent Japanese banks as well. Other market indices appear to be following the Nikkei higher as a matter of "monkey see - monkey do". Meanwhile the Nikkei is now 185 points higher at the open, merrily on the way to new highs?. Cheers!

- Black Blade

http://biz.yahoo.com/rb/020307/business_enron_investigation_dc_1.html
WASHINGTON (Reuters) - The U.S. Justice Department is seriously considering bringing criminal charges against accounting firm Andersen for its role in the collapse of Houston-based Enron Corp., federal law enforcement officials said on Thursday.

Black Blade: In fact many companies have fired Arthur Andersen as their accountant. There is no more trust in this criminally corrupt and unethical accountant. Today Delta Airlines bagged and tagged Andersen. Any investor who discovers that AA is the accountant for any company that they have shares in would do well to reconsider owning those shares. AA has lost all credibility, especially after the details around Enron and Global Crossing have come to light.

Market timing Major market turning points
Hello again and thanks for the thoughts. We don't hear enough from you. I share your opinion of trouble ahead but I base my opinion on the many fundamentals repeatedly talked about. Fundamentals don't lend themselves well to market timing. I've paid to have this fact hammered into my thick head.
I often think that Batra's "Crash of the Millennium" will prove correct. Basically, his theory was that real wage purchasing power would decline leading to an economic downturn. He tried to time this but, maybe didn't foresee refinancing and the extreme extent that credit would be extended to the American consumer.
I agree that paper assets are doomed to declining value but I've been fooled so many times in thinking that a real significant turning point was at hand. Alas, I'm still thinking the same with the added thought that it will happen before Summer. With the renewed insane upturn of the equities markets, the downturn could easily become crash. If, by chance, not before Summer then it may not occur until next Fall. Again that elusive timing.
Your thoughts do invite an "ah ha, what we've been expecting is now occuring" but I've restrained myself from buying any S+P puts because of that old bugaboo- market timing. I have instead "traded" the silver market with limited success and "invested" in silver with long term paper and physical positions. The former are intended for fiat gain, the physical will be sold only in dire times.
Actually, this timing lament certainly supports overwhelming opinion that physical is the only way to fly. In this, I agree again that a few dollars up or down with POG is mere market noise. Patience is required.
Thanks again for taking the time to post. FWIW, the stars (according to market astrologer Arch Crawford) are also in agreement with the 27-31 of this month of March as the foretold crash dates! Hey, this guy did call the 1987 short term crash- about one month's worth of warning then. This time he gives us about three weeks. Who knows, timing?
Rich

http://biz.yahoo.com/ap/020307/andersen_defections_1.html
Snippit:

Blue-Chip Clients of Arthur Andersen Are Severing Their Ties With the Accounting Firm

Black Blade: The name Arthur Andersen is synonymous with fraud. It is impossible to regain a good name when it has been tied to corruption and incompetence.

http://www.comstockfunds.com/index.cfm?act=Newsletter.cfm&CFID=691969&CFTOKEN=31637627&category=Comstock%20Daily%20Comment≠wsletterid=673&menugroup=Home&aol=1
Snippit:

No matter what the economy does or doesn't do, the market is extremely overvalued any way you look at it. A few days ago one of the anchors on CNBC stated as if it were fact, that the stock market always looks overvalued on depressed earnings. Unless we go back to 1932, this simply is not true. At the ten bear market bottoms of the past 50 years, the P/E ratio of the S&P 500 averaged 11.3 with a range between 16 and 7. The dates of these bottoms and the P/E multiples at the time are as follows: 1) October 1953, 9.0. 2) October 1957, 11.6. 3) October 1960, 16.0. 4) June 1962, 14.2. 5)October 1966, 13.2. 6) May 1970, 13.5. 7) December 1974, 7.0. 8) February 1978, 7.3. 9) August 1982, 7.1. 10) October 1990, 13.8.

Black Blade: Exactly!!! Good article.

Thanks for the nice commentary on my post. After posting it, I forgot to mention Arch Crawford but I do so only with reservations about the methodology he uses, i.e. consulting the stars and planets. He has called tops and bottoms of markets on occasion, no doubt about it. And he is calling now for a "FINANCIAL MELTDOWN" between March 27-31. That is strong language. We shall see if he is right.

The cycle framework I refer to has a precedent of working in the past. I read a number of newsletters and I make mental notes of who is hot and who is not. The last time this similar cycle occurred was the summer of 2001 when it was forecast that the US Dollar would top out and decline sharply against the European currencies. The time period was the week of July 4th. Arch Crawford was calling for the top on July 5th, which coincided with the solar eclipse. Crawford was exactly on target and the top came in precisely on July 5th. The US Dollar declined from about 120 to around 112 (if memory serves me right). Based on this track record of the cycle framework, I am more inclined to believe that this cycle is the "real thing" and we should witness the beginning of the demise of the US Dollar.

http://www.financialsense.com/Market/wrapup.htm
Snippit:

Overvalued Stocks

The problem Wall Street and the bubbleheads on network news are having is selling over-inflated stock prices. Nobody would argue that the economic numbers have improved. It is in the interpretation of those numbers where the problem lies. Despite the obfuscation of facts the market still remains overvalued by any reasonable measure. Nothing is going to change that, outside a severe corrective process or an increase in earnings that borders on the miraculous. No amount of spin is going to propel markets to a permanent higher state of gravity. We are talking about irrefutable economic laws. I believe what authorities are ultimately hoping for is to gradually deflate a bubble without serious side effects. If they are able to manage that, we will have surely witnessed an economic miracle. If Mr. Greenspan can accomplish this he will become the financial equivalent to the Superman of the financial markets.

Black Blade: Again, the point is that the markets are running on illusions and fantasies.

http://www.iht.com/articles/50518.htmThis article offers short and sweet support of my previous post.

HEADLINE: Dollar falls as non-U.S. assets draw buyers

excerpt:
------------The dollar fell sharply against other major currencies Thursday following an upbeat message on the U.S. economy from the Federal Reserve chairman, Alan Greenspan.

...the sentiment in the market is that a U.S. economic revival may not be good for the dollar, as a world in recovery may offer a golden opportunity to diversify out of U.S. asset markets to seek returns abroad.---------------

There's no way for the U.S. dollar to avoid the "great reckoning" that's due, but gold will see you through.

R.

When one celebrates his 54th, he wonders just what that day will bring. Well, this has been a good one. It is with great pride that I look back at the advent of this Forum and the astonishing collection of talent and brain-power it has attracted. I consider its creation one of the great achievements of my life. I extend my humble appreciation to all who see fit to gather here and share a part of themselves as regular contributors. Can I say more? Dare I ask, "Is there a place you'd rather be?" For many, myself included, I think not (family aside). But also, I am twice blessed -- not only with all of you but with an extraordinary staff as you can see from the posts by both George Cooper (MarkeTalk) and Randy Strauss (TownCrier) today -- just a sample of what this firm has to offer. They serve you as they serve this web site and our common aspirations -- spoken or not. Where else in this modern age could you find this level of dedication to not just an inert metal and but an idea -- from posters, to clientele, to staff. I am a proud man in this my 54th year. As we go into this time of renewal for all -- The Rites of Spring in all the world's religions -- I just want to give my simple thanks. Carry on, my friends, associates, clientele and working partners all -- my fellow knights of this Table Round. We have much work ahead of us.

.Excellent points....much appreciated....though I tend to think rather than the demise of the dollar we are seeing the zenith ...followed by a declining slope but not yet a demise

There may be many interchanges between the three hegemonies of Americas/Europe/Asia re currencies over the coming months. SM may just reverse shortly and have another run up in summer based again on hope and impact of some restocking....and of course....some nice inflation to pump things up.

Also, we can't ignore the drums of war....if you want to talk about cycles...well ...April just may be a war one...so sad since it could be averted but I don't think it is in the plans and views of hawks of all sides.

As to gold, we may have a higher low for a brief period especially as Japan plays its' shell games to keep banks solvent (temporarily)and weak hands are shook out... then gold might enjoy a sudden reversal to the upside...and it will keep moving...physical holdings will become very important to more people....JMO

And may they all be golden!!!

Thanks for this forum...it is real gold!!!!!

Good morning Japanese gold buyers.I am watching the markets in awe and amazement. I simply cannot believe what I am witnessing!

If gold is not allowed to do its job under these circumstances and is unsuccessful in breaking out, is it possible the holders of gold paper, recognizing the failure of their golden and paper hedge(s) will sell the market into the tidy bowl?


Japan Economy Shrinks 1.2%; Business Spending
Plunges (Update4)
By Ann Saphir, with reporting by Minoru Matsutani and Daisuke Takato

Tokyo, March 8 (Bloomberg) -- Japan's economy shrank 1.2 percent in the final
three months of last year, leaving the nation in a deeper-than-expected recession
that may force more companies to default on loans and cut jobs.

The decline from the previous quarter capped the longest slide in gross domestic
product since the end of World War II. Economists had expected a 0.8 percent
contraction after a 0.5 percent decline in the third quarter.

The drop in GDP may spoil a monthlong rally that has fueled a 25 percent gain in
the main Nikkei 225 stock average. Analysts said the government hasn't done
enough to end deflation and reverse a five-year slide in bank lending, and instead
is relying on an increase in exports to the U.S. to spur a rebound.

``The days are gone when America gets better and the world heals,'' said Carl
Weinberg, chief economist at High Frequency Economics in Valhalla, New York.
``It took Japan 40 years to get into this hole, I don't see why it will take them
much less to dig itself out.''

The Nikkei rose 0.7 percent in morning trade, extending gains fueled by
expectations the U.S. has emerged from recession and tighter restrictions on
trades that seek to profit from a decline in stocks. The yen was recently trading
at 127.58 to the dollar and is on track for its biggest weekly gain in 3 1/2 years.

The economy was sunk last quarter by a record 12 percent slide in business
spending, as companies from smokestack industries such as steel to
chipmakers like Toshiba Corp. and Fujitsu Ltd. slashed capital investment as
earnings sagged.

Job Cuts

Japan's big four electronics companies -- Toshiba, Fujitsu, NEC Corp. and
Hitachi Ltd. -- have forecast a combined 1.42 trillion yen ($10.9 billion) loss for
the year ending March 31. All four tumbled into the red as sales to the U.S. fell
and they were slow to reduce costs.

Fujitsu will cut up to 4,000 jobs next fiscal year by closing plants, paying people
incentives to leave, and not replacing workers who quit, as Japan's biggest
business computer maker bids to return to profit, senior executive vice president
Takashi Takaya said. The company is eliminating 21,900 jobs this fiscal year.

Four of Japan's top five steelmakers, including Nippon Steel Corp., and NKK
Corp. expect a total loss of $1.6 billion this fiscal year as prices fall and they
take charges to entice workers to quit.

Some companies, like Nikon Corp. and Mitsubishi Electric Corp. are moving
factories to China and other Asian countries, where labor is cheaper, to lower
costs.

The shift abroad is also costing Japan jobs, keeping consumer spending from
firing. The economy lost 230,000 jobs in January, and the jobless rate fell to 5.3
percent from a record 5.5 percent in December only because people gave up
looking for work.

Looking to the U.S.

With demand at home weak, the government is looking abroad for growth.
Government officials helped engineer a 17 percent slide in the yen between
September and February to help boost exporters' earnings. Finance Minister
Masajuro Shiokawa today said he's not happy about the currency's 5 percent
increase the past week.

Other government officials are also looking to the U.S. to lead Japan out of
recession. ``We have to admit the economy is in bad shape,'' said Chief Cabinet
Secretary Yasuo Fukuda. ``The U.S. gives hope for an export-led recovery.''

Net exports -- exports minus imports -- subtracted 0.1 percentage points from
GDP last quarter. Exports dropped 2.7 percent and imports declined 2 percent.

``Japan is in the process of bottoming out,'' said Jesper Koll, chief economist at
Merrill Lynch Japan Securities Inc. ``Over the next six to 12 months Japan will do
what it has always done: stage an export-led recovery.''

Still, exports make up just one-tenth of Japan's $4.2 trillion economy. ``Even if
exports start to pick up that's only going to benefit a small part of the economy,''
said Hirotake Araya, general manager at Tokyo Shoko Research. ``Japan is in
serious trouble.''

Consumer spending, which makes up 55 percent of the economy, rose 1.9
percent in the quarter, after falling 1.7 percent in the third quarter and 1.1 percent
in the second quarter. People had to dig into their savings to maintain spending
last quarter, analysts said, a trend that can't last.

Failing Grade

Attempts by Prime Minister Junichiro Koizumi and Bank of Japan Governor
Masaru Hayami to restore the economy to growth have proven ineffective.

Hayami lowered interest rates to zero last March -- reverting to a policy he'd
dumped just seven months earlier -- and has since pumped trillions of yen into
the banking system in a failed bid to get banks lending again.

A separate report today showed bank lending fell 4.6 percent in February, the
50th straight decline from year-ago levels. Wholesale prices slumped 1.3 percent
last month from a year ago.

``Deflation is making it more difficult for companies to pay back loans, which only
makes banks even more reluctant to extend new loans,'' said Atsushi Nakajima,
chief economist at Industrial Bank of Japan Ltd. ``This will continue for a while,
as the government's doing nothing new to fight deflation.''

Koizumi, who came to power last April pledging a speedy clean- up of the
estimated 36.8 trillion yen of bad loans that are choking off fresh credit, hasn't
made good on his promises. With an average of 52 companies going out of
business a day last year, loans are going sour faster than banks can write them
off.

Officials have resorted to tightening restrictions on sales that profit from falling
shares in a bid to boost stock prices to give some respite to banks, which must
account for their stockholdings at market value when the fiscal year ends March
31.

Remember, Michael, you just get better, from here on. Call it a harvest or whatever, all your dues paid, your illusions banished back to wherever they came from. Those who will appreciate you mostly do now, strivings for other than your own self-respect seem wasted. A castle of the mind, a place where "everyone knows your handle (?)" (honest, I never kept up with those TV shows).

You've supported an academy of wisdom banished from this world's talk shows, and you've allowed us cheering company on cold nights. You do good work, and you share more than just the work with many, many more. These seeds will return to you in ways you never guessed, through more years than you might expect. Enjoy, and receive the appreciation offered, from all who pass through your gate...

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020308/ap_wo_en_bu/japan_markets_598Huh!? I don't know what's going on here but it sure as hell stinks of deceit and desparation. One gets the impression that fear is just biding it's time before it enters for good.
********

"...Expressing concern about the yen's steep rise against the dollar in recent sessions, Finance Minister Masjuro Shiokawa said he suspected possible market manipulation � and hinted at possible intervention to dampen the currency's climb.

"After checking, and if such things are found, I think that steps may be necessary," Shiokawa said.

His vice minister, Haruhiko Kuroda backed up the notion, saying: "Foreign exchange movements in recent days have been too sudden and I don't think they reflect fundamentals. There have been abnormal movements..."

@uponroof...CavenManThe inexplicable yen turnaround, the inexplicable DOW/NASDAQ rise, the inexplicable "Productivity" Numbers, the inexplicable unemployment numbers, the inexplicable gold smashing effort [Requiring physical far over their normal COMEX suppressing, "maintenance level"], the inexplicable Japanese Finance Minister's negative comments about the inexplicable yen's rise...

These inexplicable events are all explicable IF one analyzes the threat of elderly Mrs. Watanabes taking a small portion of their life savings and placing it in gold.

As many here recall, only 1.7% of the savings at risk draws 1000 tonnes...more than the entire world's quarterly demand values.

If the monetary authorities came to this same realization, about the same time as others then they may have concluded that the threat of a massive gold demand shock is too great to ignore.

Therefore they implemented the only policy they could...jam the yen up, smash gold, dummy the "Productivity Numbers" even more than usual, pump the NKK225 by convincing Koizumi that inflation is an elixir, and most important of all don't TELL anyone ELSE at the Japanese Finance Ministry.

There is one other far more troubling reason for all this upward jamming. Monday is the six-month anniversary of 9/11. Perhaps the monetary authorities know more than they are telling about potential attacks.

Choose one from column A or one from column B.

Either one spells angst and panic at the FED. The normal Master of the Universe's Humphry/Hawkins blubbering was especially sugary this time...in the face of anti-derivatives legislation which runs 180 degrees from his Fed policy.

The Japanese are buying gold as a hedge against the loss of their life savings...not as an investment "Opportunity".

My sister has just returned from Japan after 3 years. The "Average Japanese Housewife" diispises brokerage houses, stocks and particularly the government. Kouizumi shot their hero Tanaka and his foot with the same bullet. Their confidence in ANY finance plan is effectively zero. Will they move to gold? A little.

But that small amount will drain straight from the US Treasury.

Quite a conversation going on at MSNBC ...Gen McCaffrey and another militray expert.....bottom line....we MUST go in and take out Saddam......AND we will have to stay for many years ....hmmmn....Iraq...Oil...OIL!

PS UponRoof...Having spent several months in Japan and with gov and execs....they know what's what....story is "face" and (implausable denialability

http://www.abc.net.au/worldtoday/
click on to listen...

Shrinking economy predicted for Japan

What a privilege...I see that I share my birthday with distinguished company! A Golden Birthday to you Sir, and the best of Health. Thank You for the opportunity to participate on this most Precious Forum. Cheers,

Waverider

http://www.hindustantimes.com/nonfram/080302/dLFOR14.aspTiming is everything it is said. But the evolution of the world economy will be burdened by the consequences of tragic sequences for years, perhaps generations to come. Besides the Middle East powder keg of Arab/Israeli, Afganistan, & Iraq, escalating trade tensions over steel imports, and spreading global terrorism, the U.S. will provoke China using an unprecedented high level visit from a Taiwan defence minister. Another report now states the U.S. tells China it must talk to the Dalai Lama.
Friday, March 8, 2002 �
China Summons US Ambassador over Taiwan Minister's Visit
PTI
Beijing, March 8
China has summoned the US Ambassador in the country to protest against the US invitation to Taiwan's defence minister for a summit, terming it as a "violation of America's one-China policy".
Chinese Foreign Ministry spokesman Kong Quan said the Government has summoned US Ambassador Clark T Randt and submitted representations conveying China's serious concerns over the invitation.
"The US invitation to Tang, despite many representations from China, is an open violation of the one-China policy and the three joint Sino-US Communiques on bilateral ties", Zhou Whenzhong, China's Assistant Foreign Minister said.
Tang would be Taiwan's first Defence Minister to make an official visit to the United States since Washington switched diplomatic recognition to Beijing in 1979.
"The decision will also increase the arrogance of the separatist force -Taiwan Independence Force in Taiwan and damage Sino-US relations" Zhou said, adding that the Chinese government had expressed strong dissatisfaction and opposition to the move.
The latest row in Sino-US relations comes less than two weeks after US President George W Bush visited Beijing for summit talks with his Chinese counterpart Jiang Zemin.
Tang Yuau Ming,Defence Minister of Taiwan, which China considers as a rebel province, will be attending the March 10-12 defence Conference in Florida sponsored by the US-Taiwan business council to discuss arms sales to Taiwan.
Stating that the Taiwan issue has always been the "most important and the most sensitive" in Sino-US relations, Zhou said "proper handling of the issue is the key to ensuring stable growth of bilateral relations between china and the United States".
He said America should "recognise clearly the sensitivity of the Taiwan issue and the graveness of the country inviting a Taiwanese minister".
"If US strictly abides by the one-china policy and the three joint Sino-US Communiques, it should match its words with its deeds, and stop official and military exchanges with Taiwan, so as not to damage Sino-US relations'" Zhou said.

And thank you to you and all who share in our good fortune here. May this special day & all your days be illumined with unending joy and inspiration.

It's a little late for sending a card, so I'll just share one of my favorite T-shirt proverbs.

"I'm over the hill......
(picture old car straining and steaming over the top of a hill)
.......and picking up speed!
(picture car free-wheeling downhill with it's grill smiling brightly)

Many happy returns of the day!
simply me

I raise my frosty mug of Negra Modelo to ya! May all your Birthdays be Golden. Cheers!

- Black Blade

Hope both the KING of the Castle, SIR MK, and one of the "golden" Forum Posters, Lady Waverider, have many more years as good as these last few years. The Hobbits and I expect to see BOTH your names in the future "HEADLINES".
Happy Birthday, yesterday.
<;-)

http://quotes.ino.com/exchanges/?c=metals
Though Gold and Silver have been hit for a loss, platinum is higher by $15.00 to $525.50/oz. and Palladium higher by $7.00 to $382/oz. Russian supply difficulties are likely to be surfacing again and Japanese are buyers of platinum once again.

Meanwhile Oil is holding well over $23.62/bbl and NG at $2.79/Mbtu. The USD is floundering in its 70+ year bear market at 0.00346 oz. Gold. And finally in spite of the economic devastation in Japan and insolvent banks teetering on the brink of collapse, the Nikkei 225 is 237.45 points higher at 11,885.79.

- Black Blade

http://www.usagold.com/gildedopinion/Jensen/20020307.htmlThe language of violence: In a land torn by strife, words pave the road that brings destruction to everyone's doorstep

It begins,

-----------Three Palestinian teen-agers are killed by Israeli tank fire while walking home from a soccer game in Gaza. The bodies are returned to their parents labeled "Terrorist No. 1," "Terrorist No. 2" and "Terrorist No. 3."

At a subsequent investigation, the Israeli tank commander said he saw "suspicious movements" and fired before determining what they really were. The three teen-agers then became what Israeli military spokesmen call "superfluous deaths."

Both sides engage in a curious doublespeak to justify the excesses of a conflict that grows bloodier by the day.

Palestinians, for their part, never use the word "terrorism" in describing attacks that kill innocent Israeli civilians. Suicide bombers are "martyrs" to be admired. Their blowing up of discotheques and pizza parlors are "operations" and the victims of those attacks are the "Zionist enemy." While many Palestinians make a distinction between Israelis killed in Israel proper and those killed in the occupied territories, they make no distinction between settlers and soldiers. Both the latter are fair game.----------

Includes an additional photo series by George Kochaniec. Click URL for full article.

In case you missed it a day ago, you can read the first article at the index for 'Inside Foreign Affairs' at the following address:

http://www.usagold.com/gildedopinion/Jensen/index.html

In the spirit of past price-guessing contests, and in the great tradition of organizational football pools, I wonder if we should take guesses at the day cooler heads prevail and a Palestinian State is formally recognized, leading to a more peaceful coexistence among God's creation?

"Not soon enough" starts the bidding.

R.

http://www.usagold.com/ProductsPage.html

"For as long as cannons have thundered,
they have echoed
with the sound of men yearning for gold."

-- R. Strauss

http://biz.yahoo.com/rb/020308/business_markets_forex_dc_1.html
Snippit:

TOKYO (Reuters) - The yen took a breather on Friday after racing near three-month highs against the dollar, with warnings from Japanese officials giving the market pause for thought.

After the dollar suffered its biggest one-day fall in two years overnight and lost over eight yen in little more than a week, Japanese authorities expectedly chimed in with verbal warnings against speculative trading and a rapid rise in the yen.

Finance Minister Masajuro Shiokawa delivered early, saying Japan would consider action if it found any manipulative moves, though many were baffled by what he meant by ``manipulative.''

Black Blade: Japanese authorities want a weak yen against a strong dollar in order to stimulate exports.

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Economies&s1=blk&tp=ad_topright_econ&T=markets_bfgcgi_content99.ht&s2=ad_right1_economies&bt=ad_position1_economies∣dle=ad_frame2_economies&s=APIeQPhQHRUNCJ3Mg&ao=11461009Frankfurt, March 7 (Bloomberg) -- European Central Bank President Wim Duisenberg said an increase in the value of the dollar is the reason for the U.S. steel industry slump that led the Bush administration to slap tariffs on most imported steel.
-----
``This deplorable action by the U.S. to protect its steel industry may have something to do with the exchange rate of the dollar as it is experienced by its steel industry,'' Duisenberg said at the ECB's monthly news conference.
-----
The U.S. Treasury, which oversees the Bush administration's policy toward the dollar, had no comment on Duisenberg's remarks, a spokesman said.

http://biz.yahoo.com/rb/020308/business_economy_japan_dc_2.html
Snippit:

TOKYO (Reuters) - Japan's recession deepened in the final quarter of 2001 as business investment logged its biggest quarterly fall on record, putting pressure on Prime Minister Junichiro Koizumi to speed up plans to restore growth.

Gross domestic product, the broadest gauge of the economy's health, shrank 1.2 percent in the quarter, worse than economists had expected and the first time in nearly a decade output has fallen three quarters in a row, government data showed Friday.

The slide translated into an annualized 4.5 percent fall, bigger than the 4.0 percent forecast on average by economists. ``It's a very serious recession,'' said Takashi Kiuchi, economic adviser at Shinsei Bank.

Black Blade: Yawn�.nothing new here. It is well known that the Japanese economy is a basket case. All of which makes the sharp rise of the Nikkei all that more puzzling if it were not for the Japanese version of the PPT and extreme fear of Japanese seeking somewhere - anywhere to park their Yen.

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Economies&T=markets_bfgcgi_content99.ht∣dle=ad_frame2_all&s=APIhPnxUuVS5TLiBPExcerpt:
----------O'Neill, speaking during a tour of the Persian Gulf, said bankruptcies in the steel industry and the dollar's gains against other currencies are "not connected in my mind at all. They are completely separate."

...tariffs, which will be imposed on March 20 and remain in effect for three years, will raise the cost of steel in products from refrigerators to cars by as much as 10 percent, the administration said.----------

The ECB takes issue, but sadly, any elaboration by SecTreas O'Neill as to the "real" cause in not to be found in the article.

Tarriffs on imports. Great... just great. The minority in the export part of this industry dances while the domestic consumers get pinched with higher prices at this collapse (or should I say waning) in "Free Trade", as it were.

Inflation, by any other name...

R.

Tarriffs: The domestic producers (a minority) thus protected from low-priced competions (coming from international exports) surely dance for joy while at the same time the domestic consumers (a majority) get pinched with higher prices at this collapse (or should I say waning) in "Free Trade", as it were.

Inflation, by any other name...

(Anyway, you get the idea.)

R.

http://globalarchive.ft.com/globalarchive/article.html?id=020307001828&query=irrational+exuberanceFinancial Times; Mar 7, 2002
By GERARD BAKER

In the summer of 1996, while Bill Clinton was surfing to re-election on a wave of equity market euphoria and spreading national prosperity, the mood inside the Federal Reserve in Washington was anxious.

Policymakers on the central bank's federal open market committee (FOMC) were concerned that the stock market had begun one of its periodic bouts of financial amnesia and was pushing equity valuations to levels that required increasingly far-fetched intellectual justifications.

Alan Greenspan, the Fed chairman, and his colleagues pondered what to do. Should they direct policy explicitly towards the goal of knocking some of the wind out of the stock market? Or should they keep their focus instead on real indicators of overheated economic activity - goods and service prices, wages - none of which were flashing any warning lights?

By the end of the year, Mr Greenspan had seen enough. In December he delivered his famous "irrational exuberance" speech. The Fed, it seemed, was going to do what was necessary to stop the explosion of an asset bubble of the sort that had done so much harm to Japan's economy a few years earlier. Whether through verbal warnings, higher interest rates, or perhaps even more direct measures such as imposing margin requirements, the central bank looked ready to stop the party.

When the market quickly resumed its ascent after a brief decline following the chairman's remarks, the stage looked set for a battle between the Fed and exuberant investors. But then Mr Greenspan did an odd thing. To be precise, he did nothing. Despite his warnings, there was no concerted attempt to rein back equity prices over the next few years.

The Fed made one small upward adjustment in interest rates in March 1997. But it was not until more than two years later - when the Dow had clocked up several thousand more points - that rates began to rise sharply. Even then, Mr Greenspan made clear that was aimed at a broadly overheating economy of which the stock market was just one component.

This inaction has always been something of a mystery to Fed watchers. Why did the central bank signal such obvious concern about the equity market and then not follow it up? It is not only a matter of historical curiosity but an issue with critical implications for monetary policy in the future.

The mystery only deepened last month when the central bank released the full transcripts of FOMC meetings for 1996. For the first time, they reveal the scale of the Fed's concern about rising equity prices in those early days of the technology-driven bubble.

Early in the year, the transcripts show that Mr Greenspan was not certain that the equity market was indeed a bubble. But by September, he was explicitly referring to it in such terms: "I recognise that there is a stock market bubble problem at this point," he said at the September 24 meeting - the day the Dow closed at 5874.03.

The most forceful argument for the Fed to act came from Lawrence Lindsey, one of the Washington-based governors. Mr Lindsey, who is now President George W. Bush's chief economic adviser, had been arguing for some time that the equity market was overvalued. "As in the US in the 1920s and Japan in the late 1980s, the case for a central bank ultimately to burst the bubble becomes overwhelming," Mr Lindsey said in September.

Why, then, was no action taken? Mr Greenspan has expressed doubt about whether it was the central bank's job to second guess the decisions of millions of individual investors. But this does not fit well with the remit of the central bank to "take away the punch bowl just as the party is getting going," as one Fed chairman put it.

A more plausible explanation is that Mr Greenspan became less certain the market was overvalued. In late 1996, the US was only beginning to see the outline of the improvement in productivity performance in which Mr Greenspan - correctly, as it turned out - became such a fervent believer over the next few years.

But productivity improvements could only ever justify a small portion of the rise in prices. Mr Greenspan himself subsequently fretted that the market was overvalued, telling a Congressional committee in 1999 that it was not a question of whether equity prices would adjust, but when they would.

It is also possible Fed policymakers felt any policy designed to puncture the bubble would cause huge damage to the rest of the economy. Mr Lindsey argued in 1996 that it was important that the Fed act early in the asset inflation process precisely to avoid this problem. But this put the central bank in a bind - the Fed could not be sure that equities had become structurally overvalued until prices had risen a long way out of line with historical trends. By then, the risks of acting to deflate them could have been too high.

A more likely explanation for the Fed's inaction is that Mr Greenspan and his colleagues may simply have felt constrained by their public mandate. It is not at all clear that the Fed could actively engage in a policy designed to reduce the wealth of the American people. Reaction to Mr Greenspan's "irrational exuberance" speech was highly critical. He was attacked by politicians on both sides.

The Fed is highly sensitive to such political criticism. Though it is operationally independent of political control, it derives its authority from Congress, which dictates the goals it should pursue through legislation. The Fed has undertaken unpopular policies on many occasions, but this was different.

If this is the true explanation, then a broader public debate is necessary about the freedom of the Fed to use monetary policy to end a bull market that the central bank judges has run out of control.

http://biz.yahoo.com/rb/020308/business_markets_japan_dc_3.html
Snippit:

TOKYO (Reuters) - Investors lined up to ``buy Japan'' on Friday, propelling stocks to another seven-month high despite a deepening in Japan's recession, while keeping the yen near 11-week peaks in the face of complaints by Japanese authorities.

Tokyo's benchmark Nikkei 225 average crossed the 12,000 threshold on Friday for the first time since August 9 as hopes for a U.S. rebound outweighed data showing Japan's recession extending into a third quarter in the final three months of 2001. The mood is in stark contrast to a month ago when fierce selling in stocks ignited fears of a ``sell Japan'' run on Japanese assets that many experts said could cause a hemorrhaging in the portfolio losses of banks and cripple Japan's financial system.

The yen took a breather on Friday after a meteoric rise overnight, but it looked resilient despite a chorus of Japanese authorities' comments designed to reverse its climb.

Many suspect the government's top priority may be to keep stocks strong ahead of fiscal year-end book-closings on March 31, to avert turmoil in the country's weak financial sector. The Nikkei's surge, especially after the government imposed tighter restrictions on short-selling, has sparked talk of a wave of foreign money coming into Japan, with some funds already announcing they would raise their weightings in Japanese stocks.


Black Blade: And so it goes. Living in an illusion. There is no fundamental support to suggest that the overvalued equities in the Nikkei 225 should be rising. "Interesting Times"

http://www.zawya.com/Story.cfm?id=065x5503&Section=Markets&page=Commodities
Snippit:

TOKYO, Mar 06, 2002 (Kyodo via COMTEX) -- Kakuko Arai at first could not decide what to do with the cash she obtained by selling her house after her husband died last year. She ruled out time deposits at banks because financial institutions seemed unstable, but thought stocks could also be risky since their prices are plunging. So she decided to turn some of her money into gold. "I'm afraid the banks would collapse, and I don't know too much about financial products," said the 61-year-old, who bought two one-kilogram bars of gold for about 2.7 million yen at a store in Tokyo's Ginza district. "At least with gold, I know it will not become worthless, whatever happens," she said.

Many Japanese investors worried about the health of Japanese banks and the government's plan to scrap a blanket guarantee on bank deposits on April1 are making the same choice as Arai, causing a bit of a gold rush in the nation. "A major difference from the other 'booms' in the past is that people are buying gold even though the price is rising," said Hitoshi Kosai, Tanaka Kikinzoku Kogyo's general manager for the precious metals division. Kosai said he thinks that although various other factors made investors think about turning their paper assets into gold, the nearing of the lifting of the blanket guarantee was the "final trigger" for Japanese investors.

"But the nearing of the end of the full guarantee made people really think about buying gold," he said. "This phenomenon is not seen anywhere else in the world at the moment." WGC's Toshima predicted that the trend will continue, and that the sales of the precious metal may rise sharply once again when the government lifts the refund guarantee for ordinary deposits in April next year. "I'm sure there are people out there who moved their money from time deposits to ordinary deposits for this year," Toshima said. "These people may think of buying gold in the second stage." Meanwhile, there are signs that some Japanese seeking safe havens are turning to other non-paper assets. Sales of jewelry and art objects in January rose 27% and 13% respectively from the year before at Mitsukoshi Ltd.'s main store in Nihombashi, said KazuoAoki, general manager at Mitsukoshi's corporate communications office. Many of the items, such as diamonds and paintings, were priced at several millions of yen, Aoki said.


Black Blade: Another story from the front lines. The smell of fear is very strong in Japan as Japanese look for safe haven wherever they can find it. Any hard asset will do - after all there is no real return (or even a negative return) on paper investments and in deposits at insolvent Japanese banks. Some even seek refuge in the Nikkei 225 as the government appears to be willing to prop up the market prior to year end "window dressing". Banks must value stock investments at market rather than at the purchase price. So it appears that the sharp rise in the Nikkei has less to do from citizen investors, but rather the new Japanese PPT and gullible foreigners.

Thanks for your thoughts last night. As you say it all goes back to the enormous leverage the Japanese have regarding gold consumption.

Knowing this is the wild card in all these international monetary gyrations one would think the friends of gold would be in the thick of this, having their say. By that I mean an agressive advertising campaign in Japan promoting the advantages of gold.

I cannot help but think of that 52 million dollar marketing budget of the WGC. I have read that they are involved in Japanese advertising but I wonder to what degree. Japan, right now as their banking crisis looms, is perhaps the best chance gold has had in decades. To hold back and 'keep powder dry' is IMHO foolish.

Spend the marketing capital now in Japan! For that matter, pass the hat amongst the mines and raise some more...this is an all out war and perception is the battlefield.

If you knew that gold reigned supreme in all money matters, why would you promote it? In hopes that those of small wealth would be able to share in the giant's standard of living? Not unless this giant has non-human motivations like goodwill toward men.
We really know better. Instead, the giant uses every means, stopping at nothing, to convince the people of the village that there are far better investments to be had.

Notes from my morning newsletter:
"With all this so called recovery all over the place, it sure isn't showing up in these two monsters(SUNW & INTC). Intel said the wireless communications side of things still stunk. they were selling a few more servers however. they narrowed their guidance a bit, tightening the range that revenues would come in at. but probably the most telling thing said was this "We see no signs of an increase in the economy effecting our business as of yet".

Isn't that interesting? The biggest chip maker on the planet says that things might be rosy, but it isn't showing up at his company. We have heard the same things from Honeywell, GE, CIEN, and a host of other widely mixed areas. How can this be? How can the economists tell us all day/every day that things are going gangbusters, but the heads of the biggest companies on earth say "we don't see it?" Oh boy, don't get me started!

Listen friends, we are seeing an economic dead cat bounce. Nothing more. We don't see this as the start of some new roaring economy, no more than we think this is the start of some new bull market. We have taken great pains to explain how NO economy can go flat for 18 months without seeing a pickup as inventories work off. that is as normal as it gets. But, without a big move in demand, its no more than a dead cat bounce.

Intel says they don't see any big demand pop. GE said the plastics business is flat as a door. CIEN says they have no idea when a recovery is coming. Over and over its the same, "good" economic numbers, but major CEO's saying they don't see it. Can it be that CEO's are being cautious so they can come out later and beat the estimates? That is what a lot of folks think. Baloney. They would like nothing more than to beat their competitors to the punch and say things look great.

http://www.iht.com/articles/50598.htmlSnippit:
"The controversial U.S. tariffs on steel will disproportionately hurt allies in Europe even though European companies have significantly cut steel exports to the United States in recent years, leaving political leaders in the region angered and perplexed why lesser allies are getting better treatment.

By applying the steepest tariffs on products made in Germany, France and Britain, the administration of George W. Bush has opened itself to sharp criticism from its closest friends."

Waverider: More on steel...

~Mikal, Gandalf - thank you.

Hope you too had a happy one...and future golden ones HB!!!

http://news.bbc.co.uk/hi/english/business/newsid_1862000/1862491.stmBankrupt US retail giant has unveiled plans to axe thousands of jobs as the company tries to return to profitability.
The company said on Friday that it would close 284 stores in the United States and Puerto Rico, with the loss of about 22,000 jobs, or 9% of its total workforce.

http://www.ananova.com/business/story/sm_539627.html?menu=business.economy
BIS' Crockett says central banks must focus on asset prices, not just inflation

----Bank for International Settlements general manager Andrew Crockett said central banks should not just focus on inflation, but also monitor asset prices for risks of financial bubbles.

"I see the risk that policy focussed only on inflation control, beneficial though that is, does not stop the inherent tendency of the financial system towards excess. During periods of expansion exuberance takes over, asset prices are pushed to high levels and then there is a reversal," Crockett said in an interview with the journal Financial Regulator.

"This is not easy to solve. I am not advocating that central banks should target stockmarkets or asset prices. However, if inflation in goods and services is under control, but inflation in asset prices (fuelled by credit expansion) is proceeding rapidly, that is a danger signal," he said.

Crockett said close monitoring of monetary and credit growth can give a useful pointer to the build up of asset price bubbles.

"In the days when central banks focused on credit expansion or monetary aggregates, you would notice rapid credit expansion and ask questions about the risks it was posing. If you are focussed exclusively on inflation you do not see the risks if they do not show up as increases in the price of goods and services," he said.

The switch to inflation targeting by some central banks has been successful in delivering price stability, but it has not prevented periodic boom and bust cycles in asset prices, which remain an unsolved problem, said Crockett.

And in the long run, it is difficult to maintain price stability without dealing with booms and busts, he said.

Crockett said there has been a correction in the asset price cycle which has been well managed in most countries, but which has been difficult to manage in Japan.

"In the case of Japan the unwinding of an asset price bubble has led to a very complex deflationary situation," he said. "(But) I don't see other industrialised countries facing the problem of deflation and impotence of monetary policy."

The Japanese financial situation may be more difficult than has so far been publicly acknowledged, and the most important thing is to carry through reforms beyond the banking system, to improve corporate governance, productivity and profitability in the economy as a whole. Interest rates appropriately when this becomes necessary.

"The Fed is very aware of what monetary policy has to do. They monitor the situation very closely. I have great confidence that they would move to tighten monetary policy when it became necessary to do so. Clearly, it is not necessary at the present time," he said. ----

http://www.mises.org/fullstory.asp?control=908&FS=Defining+Inflation
Defining Inflation by Frank Shostak

--On August 16, the U.S. government will debut of a new type of Consumer Price Index (CPI), one which it says will better reflect true inflation. --

Marketing gold in Japan is too much like competent action for the WGC to be interested. After all they are the lackies of the cabal. With their leading econo-slut Jessica Cross bleating about how hedging is so good...ooops...bad. Only people with letters after their names can smile so serenly when they have feet in their mouths.

The WGC follows the axiom: "There is only ONE person here who REALLY knows what's happening...that person MUST BE FIRED".

As for the Japanese...they are running out of small safes...they are standing in lines around ther block...they are back ordered 90 days supply of gold. This from a cafe supporter in Japan.

Sleep tight, the politicians and monetary authorities on both sides of the Pacific are exactly what gold bugs want them to be at this juncture...predictable and corrupt.

Did anybody catch that short segiment on CNN i think it was (although i usually give Fox my ratings) where a lady was permitted to open what was left of her safe deposit box that was in world trade center. the tv cameras were with her and panned a room where all the boxes were kept and to me they all looked pretty much like burnt tin cans but the lady was hoping to get some family relics and such and when she opened the box everything but two items was destroyed. Her rings were all blackened with the exception of a red rubie and i also noticed a few of what looked like one ounce shiney gold coins.

My question is can gold take a burning and still survive something like what happened at the WTC? i'm sure some of us have valuables in bank vaults too, I guess thats where the PM insurance comes in the picture right?

Roger Bently Arnold

Japan and the rest of us

There appears to be a coordinated effort between US and Japanese financial institutions right now to get liquidity into the Japanese financial markets and economy ahead of the end of the fiscal year on the 31st of this month. However, this effort would also have to include the federal governments of both countries as well as the central banks. I do not make these statements lightly. This is however, after long consideration, the only logical conclusion I can draw from the movement of money into Japan over the past couple of days and month.

Japan is in its worst recession since WW2 and the BOJ Governor is worried about a run on banks by depositors within just the next few weeks. At the same time Merrill Lynch and others are advising clients to buy Japan. There has been no near term shift in economic policy in Japan that would warrant optimism and a reduction in country risk. No new economic legislation has been passed. No substantial reforms have begun. The BOJ continues to refuse to pump more yen into the banks although the desperately need it and without it will collapse very soon.

The Nikkei was up 237 points today even as the economic news was again terrible. Japan's economy shrank 1.2% in the fourth quarter of last year and bank lending fell for the 50th consecutive month in a row. Both of these are incredibly negative indicators of the trajectory of Japans economy. But, the stock market has jumped 27% in the last month while the yen has begun appreciating against the dollar.

Yesterday US treasury bond yields fell across the board, the dollar fell against the euro and the yen even as gold prices fell. This means that all of these investments were sold at the same time. That is illogical. As they are different assets classes they will often move inversely. The dollar and US treasuries declining simultaneously is fine. But, for gold and the dollar to fall precipitously, simultaneously, does not fit into any financial model.

Remember the inverse cyclical relationship between gold and the dollar. It is like a see saw, one goes up the other goes down. This means that as the dollar fell yesterday gold prices should have risen. The fact that they fell dramatically, $3.60 an ounce, is an indication of massive gold liquidation into the technical buying that would have been caused by traders speculating on gold rising as the dollar fell.

It is an indication that there is either 1) a large single seller, Japan, of both the dollar and gold or 2) a coordinated effort by very large financial institutions to liquidate both simultaneously. It is probably a little of both. This however would require prior knowledge of what counterparties would be doing because it violates financial rules. No gold trader is going to sell gold while the dollar is declining so rapidly on an intraday basis unless they know that others will be doing it and why.

The only logical conclusion I can draw from this is that Japanese banks are aggressively selling assets to raise cash to 1) meet liquid reserve requirements and 2) to buy stocks to bolster the value of equity reserves. At the end of the Japanese fiscal year, March 31, the stock assets of the banks are marked to market as an asset for reserve requirements and this year the governments guarantee on deposits at banks drops from unlimited to $75,000 per account. Both of these mandate immediate bank and equity cash injections in order for Japan to maintain the illusion of a solvent banking industry.

If it was only Japanese repatriation going on that would be fine and we could explain it. What is troubling though is the buy signal being put on Japan by Merrill Lynch and other western investment banks. This is illogical and can only be explained as a coordinated effort to buy Japan no matter what. That is called manipulation and I believe it is the only logical explanation for what is occurring.

In order for an investment of any kind to increase in value either the expected future risks have to decrease or the future rewards increase.

Neither is the case within Japan. We must then consider Japan within the context of the rest of the investments available in the world.

In that case we could only expect investments in Japan to increase in value in the face of negative domestic news if the downside risks everywhere else in the world were greater than in Japan or the upside potential everywhere else was lower than in Japan.

This too is not the case.

There is no logical case of any sort to be made for investing in Japan right now. Their economic, financial and political potential is decreasing on an accelerating basis technically, fundamentally, cyclically and secularly. There is literally no good news and no expectation that there will be good news.

The only logical conclusion is that the world is trying to prop up and postpone the collapse of the Japanese financial system and economy in an attempt to mitigate the negative shock consequences and potential cascading effect it could have on the rest of the world. The current events should give every investor in the world reason to pause and consider the potential near and long term economic prospects for world growth.

http://www.forbes.com/2001/01/30/layoffs.htmlI have been watching the Forbes Layoff Tracker for some months. At first they had a running tally of layoffs. Then that tally got reset, I think when it passed or got close to 1,000,000. Since then it had climbed to around 80,000. Now they seem to have removed the tally all together and only have a listing of layoff headlines.

It really feels like we are in "The Matrix" some days.

Who does the author write for?

http://www.thisislondon.co.uk/dynamic/news/business/top_direct.htmlA team of gravediggers dug up scores of skeletons from French Riviera cemeteries and stole their gold fillings to make jewellery, police have revealed.

The gang of four worked as undertakers by day but by night they used their inside knowledge to raid graves around the Mediterrannean city of Nice.

They stole mostly gold fillings, gold teeth and wedding rings, which they melted down to turn into jewellery and sold to local traders. They were caught after an overnight stake-out, a police spokesman said.

Rock,
Gold will melt at 1945degF and vaporize at 5380F... so chances are your gold will survive most fires in good condition and even if melted it will still be recoverable.
Silver a little less fire resistant at 1761F melting and 4010F vaporizing temps. If it's stored in a steel container the container will melt at about 2800F. It will not oxidize as do diamonds etc.

The maximum flame temperatures in a house fire reaches about 1800F but most of the time it is far less and your gold should be stored in a container that will protect it from direct flame impingement. Of course you can can store it underground where it remains fireproof.

Exactly! As I have said the whole situation in Japan is nothing more than an illusion. There is no fundamental basis for a rapidly rising Nikkei 225 in the face of a deteriorating economy and a woefully insolvent banking system. In effect this is all "window dressing" ahead of year-end accounting. As far as selling the USD and Gold, this too is to shake confidence and shake loose Yen for propping up the Nikkei. It is all an Illusion. I wait to see how it all shakes out after "April Fools Day". Cheers!

- Black Blade

Rock,

That account reminds me of the TV cameras in Kobe, Japan after the big earthquake when an old woman shuffled through the ruins of her home and found a box. She opened the box and it held gold bullion while her cash was burned. Gold and Silver are forms of portfolio insurance and when we see these events on TV it drives home the point. While the Wall Street Pimps and Media Trolls hate to see this kind of coverage, it is undeniable that when it really counts one cannot beat physical Gold and Silver in desperate times. Cheers!

- Black Blade

http://stats.bls.gov/news.release/empsit.nr0.htm
Snippit:

Total employment rose by 851,000 to 134.3 million in February, after seasonal adjustment; this increase more than offset a large decline in January. The employment-population ratio increased by 0.4 percentage point in February, returning to its December level of 63.0 percent.


Black Blade: The operative words here are "seasonal adjustment". There is of course no mention of those who have simply given up actively looking for employment and are therefore now considered "employed" as far as the BLS is concerned. The BLS acknowledges that these official unemployment numbers are bogus (as per BLS report 864 and 871). Meanwhile today Kmart announces the closure of several stores and the firing of 22,000 workers. Also, JPMC will be firing several workers as well. The "Bone Pile" continues to grow with the addition of "nonessential" people. There is even word that the US Post Office will cut loose 10,000 workers. Meanwhile, the Media Trolls are making it "official" after several months saying that layoffs are not indicative of a recession, however this morning the cry is - "The Recession Is Now Over!" "Interesting Times"

Get your motor running! Get out on the Highway!Wishing you both a Happy Birthday.

Oh Yes, BORN TO WILD.

Slingshot----------;o)

http://www.nypost.com/business/43006.htm
Snippit:

March 8, 2002 -- J.P. Morgan Chase & Co. is preparing to hand out more pink slips in its investment banking division, in the latest sign that the slowdown on Wall Street isn't reversing anytime soon. In the next few weeks, J.P. Morgan will begin a new round of job cuts in its merger and client coverage areas within its banking arm, executives close to the firm told The Post.

The firm is considering reducing the staff of those areas by as much as 10 to 15 percent worldwide in order to reduce overhead amid an earnings drought, the executives said. The latest cuts, which will be focused largely on senior-level bankers, will put hundreds of bankers out on the street.

Black Blade: Gee what a shame.

Screwed that one up tooBORN TO BE WILD is what it should say. Sorry.
Slingshot

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http://groups.yahoo.com/group/gata/message/1048Durban CEO will be allowed to return to South Africa:

http://groups.yahoo.com/group/gata/message/1048

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

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http://biz.yahoo.com/rb/020308/business_markets_bonds_dc_8.htmlWhat will be the effect of the week's change in interest rates on the interest rate derivitives of JPM? Any other signs given by this move?

snippit;
Treasuries Suffer Year's Worst Week
By Jon Herskovitz

NEW YORK (Reuters) - U.S. Treasuries plunged on Friday, wrapping up their worst week of the year, as strong employment data and an upbeat economic report card from Federal Reserve Board chief Alan Greenspan convinced bond investors interest rates will head higher in coming months.

As I was tidying my office today I was coming across a year end 1989 S&P's Stock Guide. Only 13 years back, though what a difference the new economy has made. Most of the old house-hold names are gone and the new ones are already on their way out.

The guide didn't now Amazon yet, but AMAX and Amax Gold are gone (the first to Cyprus and the latter to Kinross). Cisco was only known as "The Kid" and Yahoo was some weird shriek of victory. And Enron, which will historically be known as the equivalent of the GS Trust - the first mutual fund - back in 1929, used to be a back alley pipeline co.

Seems like history is catching up fast these days.

The global economy is (was, the elitists say?) at the brink and so is the monetary system. A system backed by nothing than promises of pay back at some time in the future.

In a future when we're either dead or the promised payback has depreciated (inflated) to a shadow of its original value (purchasing power).

When the last global creditor, the Japanese people turn to gold - notwithstanding the short term manipulation of the Yen and the Kabutocho - it may seem prudent for the lesser savers to rethink their investment strategy.

... and as the US is starting to turn to protecting what's left of their basic industry - the scenario is starting to get ugly in every reality. A reality, all the statistics of BLS and similar institutional statits can corrupt, but not correct.

The latest semantics of AG remind me of the walker (not johnny) of a tightrope, without a pole. Mildly positive on the economy - though not too positive,as it could mean higher interest rates. Poor guy, at his age he would probably prefer a classy nursing home with some Randian Ayn-gels.

OK, I'm off skiing and just want to repeat it's time to concebtrate on your investments returning instead of a return on your investment - got gold? - See U cb2

Re: your 71304, excellent find.

A must read for anyone concerned about Japan and confused about market actions in the last couple weeks.


Thanks sector buddy, clears some cobwebs.

http://www.myhomelender.com/If I may (not trying to sell anything!!...)but to provide source of good info) ... Roger Bentley Arnold puts out an excellent free daily newletter....well worth getting (either use above or e-mail Roger@MyHomeLender.com)

Although he is involved in mortgages his take on the economy is excellent as evidenced by this morning's article on Japan and the Rest of Us

A Happy One to each of you, Michael and Waverider!
Waverider, as a member of the fairer sex, I'll not ask but just assume that you are young or, as was Jack Benny repeatedly, just turning 39.
M.K., I beat you to 54 by three months. Whenever I'm called an old man, I stare over my glasses and reply, "I'll dance on your grave you young pup." Now that you've joined Methusala and me and the rest of the AARP club, you may find this reply helpful.
Another good answer when questioned as to the longevity of your consciousness; "I'm as old as my tongue and a little older than my teeth."
May we all live long enough to see both gold and silver fairly valued at least one more time. After that we'll pass the torch as we must.
Happy Birthday
and
Happy Weekend to All !!!!
Rich

A very happy (though belated) birthday to you also, MK and Waverider!!!! I hope you both had a wonderful day.

Good things seem to come in waves (a bad pun, but a compliment to you, Waverider) - my kids went to three birthday parties last weekend, and my daughter will be going to another one tomorrow. Last weekend we were very busy and ate out a number of times, and EVERY restaurant we were in had someone celebrating a birthday. 'Tis the season, I guess, though I never noticed March being an especially busy birthday month before!

MK, the jewelry you sell is exquisite. I've had no end of compliments on the little flower earrings.

Greetings and best wishes to all.

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=138139
Snippit:

HOUSTON, Mar. 8 -- Increased demand for oil and natural gas should push up commodity prices in 2003 or maybe even sooner, said a panel of five industry executives at a semiannual oil field service industry outlook breakfast Friday in Houston.

"Last year, industry [capital expenditure] was up 70%, because every company knew that, if they drilled a gas well, they would get rich," he said. But that huge jump in spending resulted in just a miniscule 0.5% increase in US gas production.

In fact, production during the fourth quarter of 2001 was down 2% from the same period the previous year, Papa said. That's largely because decline rates for US gas fields have escalated to an estimated 26% last year from 16% in 1990 and will likely hit 29% this year, he said. As a result, Papa predicted, "It will be extremely difficult to grow the US gas production base" before 2010, the earliest period by which a pipeline can be built to move Alaskan gas to the Lower 48.

Oil market fundamentals may be much tighter than many people think, said Matthew R, Simmons, chairman and president of Simmons & Co. International, Houston. Russia and other former Soviet republics are credited for 56% of the recent increase in oil production outside the Organization of Petroleum Exporting Countries. "But there are not reliable data to confirm that supply," Simmons said. "Some of that production gain may have been low-hanging fruit," said Simmons. If so, he asked, "Is that production surge sustainable?"



Black Blade: Even when drilling for NG was at a record there was only a miniscule 2% increase in production. We are headed to a record NG crunch once the supply overhang is depleted. The oil supply situation is more problematic. The US is hostage to the whims of the former Soviets Republics and OPEC. None of which is a desirable situation for the US. If the US is denied oil by either group, there will be war - there's no choice.

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=138137
By the OGJ Online Staff

HOUSTON, Mar. 8 -- Drilling activity in the US has continued to decline, with rotary rigs down 13 from a week ago-reaching 769 this week-and down from 1,158 rigs during the same period last year, officials said Friday at Baker Hughes Inc., Houston.

Similar to the trend seen last week, drilling activity was driven largely by declines in land operations and drilling for natural gas. Of the rigs working this week, 624 were drilling for gas, 15 fewer than a week prior. Meanwhile, rigs drilling for oil were up 2, reaching 144 for the week, with 1 rig remaining unclassified.


Black Blade: "Energy Crisis" part 2 coming soon.

Thank you, you're all very kind. Rich...you may ask...but yes, 39 seems to roll off the tongue quite nicely (early/mid 40's and as fit as a fiddle)! I'm convinced that daily exercise is one secret to health, youthfulness, and longevity...and the others are...well...secrets! Cheers,
Waverider

I hear that! A couple of hours a day for a good solid workout burn in the gym and then you feel great the rest of the day.

BTW, Happy B-Day!

- Black Blade

In the last hour I have re-read your Japan post half a dozen times. It is indeed enlightening.

I went to the bank the other day and stopped at an ATM machine to grab a couple bucks. A very small notice was posted on the corner of the monitor, "ATM transactions have been increased from $1.25 to $1.50." The first thing I said to myself was, "How much money do these banks want to make?" This is after recalling that banks (ie: Royal Bank in Canada) had record profits in the last quarter. The second thing I thought was, "covering increasing loan loss provisions".

After your post today I am thinking about numerous posts whereby 'dumb-ass' decisions by government is (ultimately)paid by the 'little guy' and how this relates to the bank 'ATM increase'.

And now I think how banks = government, the 'monetary relationships' are probably far more scarier than one can imagine.

And here is my conclusion. Gold took a beating this week, maybe some 'irrational exurberance' of 'hot money' leaving the gold sector to chase what's hot. So be it. In 2006/2008 when the battle for oil/NG becomes ultra-fierce (rock-on BB)and demographics, such as the edge of baby-boomer retirement hits, this massive, manipulated, piece-of-sh*t money swindling charade will strike every man, woman and child across the skull with an anvil.

Japan is an old society that's been there, done that and got the T-shirt. It's a country that is tired, broke, out of resources, out of time and beat. End of story. Anyone that can't see out into a 10 year horizon is euchred.

Gold promised to break in 1999 and it promised to break in 2000. It was poised in 2001 and now gold yaps a storm in 2002 and 2003. It may be time and maybe, it's not, (a) I don't know, and (b) I don't care. This world is going to get very scarey soon enough. Anyone not preparing is not seeing the big picture, the 'long' picture.

I again thank you for your message today, it was 'cut-and-pasted' into my 'gold' book and is entitled "An All Call to Save Japan; If She Breaks The World Will Follow"


Have a golden week-end.

Canuck.

http://www.financialsense.com/Market/wrapup.htm
Snippit:

The markets could be in for a rough ride and this rally could be cut short if companies don't deliver as projected. More important than this quarter, which has already been pre-spun as a loser, is what these companies say about the future. Analysts are projecting very hefty profit gains in the second quarter. Many will be watching closely what companies say about the second half of the year. Judging by what companies are doing, such as selling off plants, writing down impaired assets and laying off more workers, it would be a miracle if these companies could deliver the high double digit miracles analysts are forecasting. The numbers are not adding up between what companies are reporting, what they are doing, and what Wall Street is projecting. Even the economic growth rates of 4 to 5 percent for the second half of the year don't look believable. Fed
Chairman Alan Greenspan also had trouble swallowing the jump in the activity numbers that were reported.

Black Blade: The investing public will be watching. Next "earnings season" could be a "make or break season". If earnings disappoint, then the markets could tumble hard and a lot of people will be asking a lot of embarrassing questions.

Recent imposition tariffs are eerily reminiscent of a bygone era. Tariffs (like most regulations) invoke the law of unintended consequences. Some of the unintended consequences of the Smoot Hawley tariffs in 1929 were reciprocal tariffs. Another was that American farmers lost 25% of their market overnight. This led in turn to massive default on farmer's debt and bank collapses. 10,000 banks closed their doors in four years. Years of global economic turmoil eventually gave rise to world war II.

We ought to take a lesson from history! I understand the "fortress" America mentality and the pressure from the left which gives rise to this type of fuzzy thinking. Let us consider what the law of unintended consequences might bring us this time as we introduce tariffs on steel and lumber and what else? Might these tariffs be a trigger as they were in 1929? What effect will they have on an already faltering Japan (the second largest economy in the world)?

http://www.news24.com/News24/Finance/Companies/0,4186,2-8-24_1154105,00.html
Snippit:

Pretoria - Home Affairs Minister Mangosuthu Buthelezi has instructed that Mark Wellesley-Wood - the chairperson of Durban Roodepoort Deep gold mine deported last week - be allowed to return to South Africa. The minister said in a statement on Thursday that he had instructed the department to re-issue Wellesley-Wood's "temporary business permit, remove his name from the stop list and re-instate his visa exemption".

Black Blade: This soap opera is likely to continue. Roger Kebble has been booted from the board after his failed coup attempt. "Interesting Times"

http://news.bbc.co.uk/hi/english/business/newsid_1859000/1859096.stm
Snippit:

Opec's output is at an 11-year low Oil producers cartel Opec risks slowing down economic recovery in the United States unless its steps up oil production by 1 million barrels per day, a US energy agency has warned. Its current output quota is at its lowest level since March 1991, analysts say. Sticking to current output limits threatens economic revival not just in the US but globally, the US Energy Information Administration has warned.

"If this quota is observed, OPEC efforts to boost (oil) prices could result in prices well exceeding their target, just as the U.S. and world economies recover," the EIA said in its monthly Opec update.


Black Blade: Oil is the blood of the economy, without it the economy dies. It is no wonder that the US Government position is that OPEC should provide "Cheap Oil" to the US. Then again, are we not in an "economic recovery" as the Wall Street Pimps and Media Trolls say? Hmmm�

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3W5D9JHYC&live=true&useoverridetemplate=ZZZUGORQ00C&tagid=ZZZNSJCX70C⊂heading=global
Snippit:

Andersen suffered another blow in its battle for survival on Wednesday when it lost the audit of Freddie Mac, one of its largest clients by revenues. The professional services firm, which is threatened with ruin over its role in the Enron scandal, had been the only auditor of the giant US housing finance institution in its 32-year history. The defection follows that of Merck, one of the world's largest pharmaceuticals companies, last Friday, and raises further questions about the viability of Andersen's business.


Black Blade: The client list grows shorter day by day. Yesterday Delta Airlines dropped AA as auditor. They also agreed to plead guilty to criminal fraud in a plea bargain agreement with details yet to be released. They are the subject of numerous investigations, and numerous law suits have been filed against the firm. Any company that retains AA as auditor risks being tainted with the same brush as Enron and Global Crossing and earnings reports are suspect. "Interesting Times"

BB,

Have'nt had the time to post as of late, but have been watching economic developments. Was surprised you hadn't commented on the "sudden" rise in black gold and giggle gas over the last few weeks; although felt you made up for it today...I call it giggle gas because of the gains in fiat I've had over the last few weeks. Sure made me giggle when I turned it into the yellow metal this afternoon.

As far as the general market goes, I guess I'll need to apologize, because I'm just not buying into the fantasy their screaming as a recovery, and I happen to think any future moves will be squelched by higher oil prices and natural gas. Not to mention a profits recession for business. In fact, I've never heard a bunch of cackling geese scream recovery this loud in my laugh; this alone doesn't allow me to be on the same side of that trade. An economic stimulus package? I thought we were never in a recession. Frankly put, I'm getting pretty damn scared at the incompetence; err or the obvious manipulation. Depending on which side of the fence your standing on...

My friends in the pits are scared of inflation...it's looks as though we could or should be headed in this direction. Have been reading(or rereading) FOA's commentaries with serious interest. Between April and July of 2001 prove to be very interesting. His scenario is looking, well should I say timely, although not in a timely fashion? (Huh?) At any rate, his scenario is spot on...and look forward to any further updates in the future...

Had elk steaks tonight and was thinking of you as we were talking over the fire.


ALL:

Stopped into a new local coin store today. Was throwing the usual salvos back and forth that I do when I meet a new coin dealer. Interesting thing was, I was interrupted twice. The first time was a phone call to inquire about mutual funds that hold bullion coins. The second was a person who had 500 dollars to invest in gold or silver, and wanted to know the proper route...

I asked my new friend does this happen often. I have to admit at this point I was pretty damn curious. He looked me directly in the eyes and said, "about ten times a day...tiring too".

Thought it was a nice nugget to pass along. There seems to be some interest from the general public out there. If you have any friends who inquire...lend them your knowledge, you probably know more than you realize.

I spoke to another friend, who initially called about a computer question after getting home. The second question was about Barrick taking over Homestake. Previously we had never discussed Gold, but knows I'm knowledgable on the subject. Come to find out he was a long-term shareholder of Homestake Mining.

As an Investment Advisor it was the easiest "sell" recommendation I've ever issued, but rest assured Newmont Mining will have a new shareholder come Monday.

Yes Michael I was listening.

Take care all,

The(physical)CoinGuy

Cobra(too) - A rant? not hardly...well reasoned opinions should be the order of the day. It was befitting; I received my new S&P book today. I mulled it over as I was looking over the Preferreds, but I mulled over what you had to say with more interest...

Since my personal assistant isn't typing this I have to apologize for my own incompetence...

laugh = life in that second paragraph.

My best to all

TCG

Couldn't go into the weekend without finding something to consider regarding the Japanese situation.

More problems for banks who are holding JGB 'no win' dogs.
********

Issued: March 4, 2002
Bond-auction scare sparks talk of reform


"...A rumor is quietly circulating among traders that bids by financial institutions nearly fell short of offerings at the five-year government bond auction on Feb. 7. If bids fall short of offerings, confidence in auctions could be lost, sending long-term interest rates soaring.

The 1.18 bid-to-cover ratio for the day was a record low for a five-year government bond.

The only thing that saved the auction from a crisis situation was a major securities brokerage that bid at a lower price than anticipated by the market, even though it did not want to buy the bond, according to one market participant.

The auction's unexpectedly poor performance shook the government bond market. The yield on 10-year bonds rose to a 13-month high of 1.57%. Some traders say the yield would have risen much higher if bids had not matched planned sales..."
********

Issued: March 4, 2002
JGB market racked with problems
From Moody's monitoring to stalled reforms, bonds face long haul to recovery


"...The ministry is worried that government bond sales could add to Japan's economic woes. The financial system could fall into turmoil if banks with a large volume of government bonds suffer losses on their portfolios. If the rise in government bond yields, meanwhile, nudges banks to raise their lending rates and housing loan interest rates, businesses and households could suffer.

Saturating market

Another area of concern is that government bond issues are snowballing. In fiscal 2008, Japan plans to issue 127 trillion yen worth of debt to refinance older bonds reaching maturity. It will be difficult for the market to absorb the issues, which will reach 10 trillion yen per month, unless a wide range of investors are willing to buy.

The ratio of Japanese government bonds held by the public sector and banks is higher than the ratio for U.S. and European government bonds, while overseas investors hold roughly 6%, just one-sixth the amount of global investors' holdings of U.S. government bonds. Individuals hold less than half the amount of Japanese government debt than they do U.S. debt..."
********

It is quite a coincidence that tonight I had elk steak, spuds, corn and of course Negra Modelo. I can't wait to "accumulate" more game for the freezer.

I have been watching NG and oil for quite some time. Today NG reached $2.80/Mbtu and NY Crude is $23.84/bbl. It appears that NG will bounce much higher as drilling activity is falling off fast and as a critical commodity for domestic electricity production, we will see a repeat of the "Energy Crisis" that we saw last year in California. If there is an economic recovery as the pundits say, then we are definitely in trouble as there is absolutely no way that production could be ramped up on short notice. BTW, I see that Sen. Diane FineSwine (D-CA) is determined to restrict use of coal with some new carbon credit legislation. Yeah, that's just what is needed.

Economic recovery? Hmmm� I saw Labor Secretary Elaine Chou on the tube giving an interview on CNBC and alluding to there having been no recession. I wonder what rock she's been hiding under for the last couple of years. I guess the wealthy and powerful really are different than the citizen in the street. They have the attitude of Marie Antoinette - "Let them eat cake". When people like these live in an Ivory Tower, they simply do not see the world as it is but rather through rose-colored glasses. You could say that this is the "Stepford Administration".

Yes, I believe that the higher NG and oil prices accompanying rising demand will quash any attempted economic recovery. We now see that Dubya has placed tariffs on foreign steel to protect American steel makers as it is a national security issue. We should be looking at energy the same way. Without "energy independence" we are subject to being held hostage by oil producing regions around the world that despise America. We also have not done much to efficiently develop natural gas reserves, build up energy generating capacity or upgrade the decaying energy grid and build more NG pipeline capacity. Energy is an even more important national security issue. Without energy, there is no economy.

As far as the US economy is concerned, I just see so much manipulation of the data and dubious earnings reports based on wishful thinking (Pro Forma, operating earnings, etc.). This house of cards will come tumbling down eventually. As always I say get out of debt, get Gold and Silver portfolio insurance, get enough cash for several months expenses, and get a family (or personal) nonperishable food and basic goods program started. And of course hope for the best - but at the very least be prepared.

Anyway, I have another Negra Modelo to finish. Cheers!

I have noticed that after hours tonight, the POG has been so far +$1.10, the +$0.70, and now +$1.60. Now where is this after hours market? Strange indeed ;-)

- Black Blade

http://www.usagold.com/cpm/abcs.html

The ABCs of Gold Investing

"Without waxing philosophical, a few words are helpful concerning the mind-set with which you pursue your interest in gold ownership. Some enter the gold market to make a profit, others to hedge disaster, some to accomplish both. No matter into which category you fit, make sure you understand why you are going into the gold market. Convey that understanding to the individual with whom you are structuring your gold portfolio. The whys have quite a bit to do with what you end up owning.

"Frequently investors will say that any kind of gold will do because after all gold is gold, isn't it? This type of attitude has helped a great many coin shop owners unload unwanted inventory they hadn't been able to get rid of for years. This is probably a good deal for the coin dealer, but it could spell disaster for you. In the same vein, I have talked to hundreds, probably thousands, of investors in nearly a quarter century in the business. Quite often, potential investors have no more reason for buying gold than 'everybody else is doing it.'

"In Chapter 16 on portfolio planning, you will find some details on this important subject. For now, consider the inscription over the entrance to the temple of the ancient Delphic Oracle: 'Know Thyself.' Study. Read. Learn what's going on around you. Call a few gold firms and ask questions. There's nothing like conversation to stimulate thinking. Take time to lay a little groundwork. Then make your move. The political and economic situation being what it is, there is no better time to start than now. Know thyself -- your goals and needs -- and you will be a more confident, happier gold investor." (more)

Please Remember: It is your purchase from USAGOLD / Centennial Precious Metals that nourishes these pages.

http://www.usagold.com/onlinestore/special.html(from The Scotsman -- March 9)

On 30 July the US government is to sell the most valuable gold coin in the world - the fabled 1933 double eagle $20. After it was struck, Roosevelt took the US off the gold standard in an effort to help the economy out of the depression.

All the 1933 double eagles were ordered to be destroyed but ten are known to have escaped into private hands. As they had never been "issued" as coinage, they could not be legally owned and were seized. The one to be sold jointly by Sotheby's and Stack's was returned to the US Mint in 1996 and has been authorised for sale, with an estimate of US $4 - $6 million.
-----------end------------

One coin, or one BIG shiny pile. That equation solves itself.

R.

http://www.nationalpost.com/financialpost/investing/story.html?f=/stories/20020308/272833.html

http://www.publicdebt.treas.gov/opd/opdpenny.htm

http://www.usagold.com/cpm/goldhelp.htmlQ&A: What you need to know before you buy your first ounce of gold...

http://www.northerntrust.com/library/econ_research/weekly/us/020219.html

http://www.prudentbear.com/guest.htmSince 1950 consumer disposable income has been higher than expenditures (savings). In 1995/96 expenditures have been higher and are setting records.

This is a great read called "The Incomplete Recession"

http://www.businessweek.com/bwdaily/dnflash/mar2002/nf2002038_9007.htmAG 'will allow' a pinch of rising prices to help corporate profits. No wonder the bond markets are freaking; how will the USD respond?

Risky business as the author notes.

http://www.usagold.com/cpmforum/archives/31200110/default.htmlFrom your article:
--------Yesterday, investors sold off bonds for the sixth consecutive day in both Canada and the U.S., sending the U.S. 10-year bond for its biggest one-day slide in four months after Mr. Greenspan said the economic recovery was "well under way," ......."It was ugly, a really bad day," said Corey Redfield, chief fixed-income strategist at U.S. Bancorp Piper Jaffray in Minneapolis. "The root cause of it is Greenspan. Yields shot up after his comments and they never looked back."
---------------

Just begin to imagine the worse slaughter in the 30-year bonds, were the Treasury still trying to issue them, that is! Maybe now more people are beginning to see the subject of this old topic a bit more clearly. Scroll down to my following post which can be found at the link given above.

site steward (10/31/01; 11:16:31MT - usagold.com msg#: 64433)
SUBJECT: Suspension (Cancellation) of 30-yr Bond as a Financing Tool

Yes, I'm fully aware the near-Thirties are still on the market, but they are now in limited/diminishing supply, thus lending a modicum of price-support.

Related item, per Wed/Thursday's news, I wonder what success ML will have as they try to float their own version of the long bond...

R.

http://home.kyodo.co.jp/all/display.jsp?an=20020309024Snippit:
"The question of whether Japan's 3,200 local governments will withdraw public savings from banks in response to the planned end to the national government's full deposit protection has left politicians and regional bankers wringing their hands.

Prefectural governments face a dilemma over the need to protect huge public deposits at banks -- whether to withdraw them for investment elsewhere and risk frightening local residents into moving their own money or leave them in place.

Bank of Japan statistics show the 3,200 local governments had 19.9 trillion yen in deposits at 163 banks as of Sept. 30. Of the total, 99% is comprised of deposits of more than 10 million yen per account.

Responding to a Kyodo News poll in January, several of Japan's 59 largest local governments acknowledged the possibility that rumors or news of their governments withdrawing their savings to cope with the end of the full protection could prompt people to follow suit, leading to a series of bank runs.

Teruyuki Miyake, an economics professor at Wako University, said, ''Most local governments will likely shift bank savings in view of the abolishment of the full guarantee, as they fear they could be sued later by citizens if they lose pubic deposits by failing to take precautionary steps in light of the refund limit.''

Waverider: Japan just gets more interesting each passing day. Could this be the ignition switch for a bank run? A little ironic, isn't it...that it may be government leading the way! Cheers!

As the interest rates begin to rise now,will we see more problems emerge at the IR-derivative monster JPM?What if we have a slow and gradual rise,can it help them?

Besides that, it tells me high inflation=higher Goldprices coming,Another problem eventually brewing at JshortPM's.

"Oh most excellent Gold...who has Gold has a treasure that helps souls to paradise."
~Columbus~

Waverider: A Golden day to All...heading up to the alpine for awhile - heli skiing if conditions permit...YEEEHAAA...

when japanese banks cap deposit insurance at a level equivalent to 75,000 us dollars what would stop a depositor who has more than this amount to set up multiple accounts to stay below the cap?

http://www.cnn.com/2002/US/03/09/bush.nuclear.reut/index.htmlChina, Russia, Iraq, North Korea, Iran, Libya and Syria named.The first two are euro supporters.The $ is backed now ONLY by military power.

Why would anyone keep ANY money in a banking system on the brink of a massive failure? Wouldn't such a failure deplete the fund, no matter what were the limits per account?

One of the largest potential financial disasters in hisory requires the one category of insurance which has been proven over the centuries...

One can follow the Gold trail in addition to the Judeo-Christian heritage trail and readily see that it's "all leading up to something."

Shades of the S&L's in the 80's.They actively encouraged that strategy,US taxpayers provided the safety net,thanks very much.

http://cbs.marketwatch.com/news/story.asp?guid=%7BD26EF7B7%2D3D6F%2D4FD4%2D8D1F%2D54EBAA6F1270%7D&siteid=mktw
Investing tip: Is it a new bull market or a sucker's rally?

Snippit:

In recent years, stock valuations reached record highs -- even with the economic downturn. Standard & Poor's this week said the price-to-earnings ratio on its S&P 500 Index -- a widely followed barometer of the market's valuation -- reached an annual record of 46 for 2001. (S& P uses income from continuing operations figures, not pro forma.) By comparison, the historic average is 14.

"The historical average is no longer valid," said Joe Liro, equity markets strategist at Stone & McCarthy Research, a financial markets consulting firm. "I doubt if we'll ever see the S&P 500 Index price-to-earnings ratio at 14 on a sustained basis ever again."

Robert Shiller, a Yale economics professor, said even if there were structural changes in the economy and financial markets, the richly valued market hints at a "poor stock market outlook than has ever been seen before," with the worst-case outcome being "catastrophic 10-year decline." They contend that the mean-regression theory basically still holds. This means that the stock market may plunge to new depths or soar to great heights at times, but in the end, it would trend back to its average, even if it doesn't hit the number exactly.


Black Blade: Actually the S&P 500 now calculates the PE ratio based operating earnings. If the ratio was calculated based on net earnings then the S&P 500 would sport a PE ratio closer to 63. And this after the big pull back in the Index since March 2000. The statement by Joe Liro of Stone & McCarthy Research sounds suspiciously like the Irving Fischer statement in 1929 - "The market has reached a permanent plateau."

"Interesting Times"

http://quotes.ino.com/chart/?s=FOREX_XAUUSDO&v=i&w=1&t=f&a=2Black Blade (3/9/02; 00:20:59MT - usagold.com msg#: 71338)
POG After Hours
I have noticed that after hours tonight, the POG has been so far +$1.10, the +$0.70, and now +$1.60. Now where is this after hours market? Strange indeed ;-)
- Black Blade
======
Just follow the USAGOLD's INO.com QUOTE trail LINK and you will see that there is a Saturday market opening "somewhere in the Orient" !
--
Now a question for you, Sir BB !
Is not the natural gas portion of the energy investment arena a slippery area, with the likes of Williams investing in communications spinoffs ?
Tks
<;-)

Gandy

There are other potential Enron's out there. Even some utilities are into marketing energy derivatives and getting involved in areas far outside of their expertise. I suspect that we will see more companies get caught up in the fallout after Enron.

As far as natural Gas is concerned, there is no way that we can keep up with increasing demand under normal economic conditions. Thankfully we have a recession to slow down demand to the point where we have some supply build up, otherwise the "Energy Crisis" of last year would still be with us. However, this supply is being drawn down at a very rapid rate and could be gone just as colder weather arrives next fall.

Add into this equation that there has been a lot less exploration and production of NG so far this year and not likely to be any significant new drilling for the rest of this year, and we have the potential for a real energy crunch come next winter. There will be no new drilling in winter and not likely until next spring. Therefore the forecasts for a very tight energy supply in fall 2002 through spring 2003 are extremely likely scenarios.

Of all the forms of energy in the US, Natural Gas is the real sleeper that will catch the energy markets by surprise as most energy analysts are not competent enough to understand this area of the energy market. This is not oil where we can import barrels from the ME or anywhere else. Natural Gas is dependent on cheap abundant domestic supply.

With increasing demand or falling supplies, the higher energy costs will nail any corporate bottom line that depends on energy (and that includes about every corporation). Therefore a sustained economic recovery under current conditions is rather unlikely.

Cheers!

- Black Blade

http://biz.yahoo.com/rf/020309/n09248900_1.htmlBB: I'm putting my vote firmly into the "sucker's rally" column. Too many divergences in the "real" eceonomy to feel any other answer would be appropriate.



ALL: Although I don't want the following to be a recommendation to buy a certain type of coin, or one metal over another, I thought I would provide a snippit from the CDN's Market in Depth Column from March 1st.

If you're looking to invest a portion of your assets in precious metals, our host is perfectly capable of giving you sound advice built on solid principles of diversification.

snippit:

Some dealers are trying to buy some coins for their customers but they first need to touch base with them and explain about the changing sight-seen market. This market is selectively strong with those dealers holding the right material able to quickly sell at good levels. However they also know that when their inventory is chock-full-of rarities it is easy to to sell but VERY DIFFICULT to REPLACE the sold coins. And, after trying to replace some inventory following quick and easy sales, they realized that they would have to pay an even greater amount than they had just received. Consequently, the buying part of the show(Long Beach Show)is said to be extremely difficult.

Dealers know that they have to Bid aggressively if they are able to compete in today's vibrant market. They understand that want lists are easily obtained but very difficult to fill.

snippit end:


Among bullion type purchases, like the $20 Libs Michael was recently selling, I also collect coins of all types. I do this strictly for hobby, but do keep in mind these coins are gold/silver. Have been having serious trouble finding some key dates to several series I've been working on. Have had plenty of dealers say sure no problem, until they make that call to the supplier... Looks to me as though the strong hands are holding on to their pieces and looking for stronger prices going forward.

At any rate, even in this economic environment, the coin market remains robust. Which I believe to be a good sign.

The(Physical)CoinGuy

Black Blade asks, "Is it a new Bull market or a sucker's rally?"
Friday's front page headline of the Investor's Business Daily (IBD) reads "Greenspan Now Sees Recovery, In A Shift From Week-Ago View". Today's IBD headline says, "Biggest Payroll Gain In 14 Mos. Drives Last Nail Into Recession". Who was the great investor, in the early years of the last century who said, "When the shoeshine boy started giving me stock tips, I knew it was time to get out." It seems the only news that isn't announcing the end of the recession or slowdown is that news that is denying that there ever was one.

MarkeTalk and I were recently discussing Arch Crawford's "market meltdown" prediction for March 27-31. I've also been watching the 1160 S+P level, wondering if we might perhaps see a final great blowoff rally day in stock equities and then one big scary move down? I'm also phantomizing about POG bouncing off the $285 level and spiking higher as the stock indexes crash. But, for the moment renewed bubble insanity is the order of the day.
B.B. Please place my vote in the sucker's rally column.
Thanks, what's the total so far?
Rich

I always hate to single out any one poster here as I enjoy, profit and occasionally get a laugh from most everything written here. Besides, I can skip the ones that do absolutely nothing for me.
That said, I've found yours particularly interesting of late, probably as you are reporting just the type of information I'm most interested in. Keep them coming!
Rich

From Friday's IBD, page A8, "Gold Still Glistens Atop Sector Ranks; Natural Resource Funds Strong, Too"
The manager with the best YTD record was interviewed.
"When returns on financial assets are uncertain or subpar, gold does very well." he said.
Hathaway said gold prices are in a new bull market that could keep them rising for five years.
Lately, it seems, many press articles have become much more friendly and investor positive toward the old barbaric, yellow, dust collecting and non interest bearing metal.
I hold no company stocks but watch the mining stocks indexes daily. Am I right in thinking that the XAU and HUI have gained more than enough so that POS and POG should be much higher? Also, the consensus from most conversations comparing metals prices with mining stock prices is that the company share prices lead the actual metals' prices by 6-9 months. If this past pattern again holds true, aren't we about due? Thoughts?
Rich

Who said, "When the shoeshine boy started giving me stock tips, I knew it was time to get out."?

I believe that was attributed to Joseph Kennedy.

My vote: suckers rally.

1) yes it was old Joe Kennedy who said that. He also became the first SEC commissioner under FDR.

2) Gold stocks tend to front run advances in Gold price. Share prices held up well until this last Thursday. Fundamentally nothing new as far as the economy. The same dillusional talk based on suspicious massaged BLS data. "Seasonal Adjustment" - that one's a hoot! "Hedonic deflator" is a good one too. I can't wait until we see what happens when "Chained CPI" comes out.

3) the total? Hmmm... I haven't kept a tally, but so far it looks like:

Suckers Rally: 3 Bear Market: 0

Cheers!

- Black Blade

Of course now Shermag makes it:

Suckers Rally: 4 Bull Market: 0

- Black Blade

Can I vote for a Suckers Rally AND a Bear Market?

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3QI2WBKYC&live=true&tagid=IXLI0L9Z1BC
Japan braced for downgrade as economy dips
By David Pilling in Tokyo
Published: March 8 2002 18:05 | Last Updated: March 9 2002 01:46
Japan's sovereign debt rating is almost certain to be downgraded, Moody's, the credit-rating agency, said on Friday.

The agency, which put Japan on negative outlook last month, said Tokyo's rating would probably fall a notch, but could drop further, which would be below Botswana, an African country ravaged by Aids.

"Even though theoretically we could confirm the [current] rating, it's very unlikely," said Thomas Byrne, senior credit officer, who said a final decision would be made by mid-May. The downgrade warning came after confirmation on Friday that Japan's economy had entered its longest recession since 1993. Gross domestic product contracted by a sharper-than-expected 1.2 per cent in the last quarter of 2001, extending the duration of the economic contraction to three quarters.

++++++++++++++++++
@shades...The reason that Japanese depositors [In large measure] will not choose to "diversify" their savings at risk to other banks is because 50 of those other banks failed last year...two last week. Moreover, the deposit pattern at smaller banks is toward withdrawals, not deposits...so we already see their loss in confidence.

The aggregate Japanese savings at risk necessary to smash the cabal is tiny...10% to 17%. The higher figure will precipitate a 10,000 tonne demand shock.

The above figures ignore the increasing world demand and the plummeting world supply.

http://money.msn.com/content/p18520.asp I found this next door. Thanks to MotherGoose.

I'm going with sucker's rally. How could it be anything else at these price / earnings ratios? But the top of the line suckers are the ones who believe that the inflation induced profits are real. My wife read me a snippet from a magazine tonight as I cheffed-up dinner (not a cook, not me! A chef to be sure) about how market professionals competely understand that the public has nearly no real knowledge about finance. It's the public that thinks its astute and that it can beat the market, while the pros know that there is no such thing as an astute practioner of the markets. The pros take advantage of that . . . . . . and that says more about how Wall Street got to where it is today, as well as most investors, than nearly anything else I can say.

P.S. I've had a Negro Modelo a time or two myself -- good stuff. You, sir, are a man of both consummate taste and consummate financial opinion. Rock on, BB!

I just printed out Adam Hamilton's offering for this week. It's 9 pages and is titled "More Bear Market Rallies!"
B.B. I guess with that title we could safely assume that Mr. Hamilton's vote goes in the sucker's rally column. I do wish I possessed a market timing talent as bear market rallies (as Hamilton has often reminded his readers) are often quick and violent moves. However, too risky for me to trade.
If Crawford's predicted "meltdown" occurs or the market adjusts to the lower levels where most time honored valuation determining methods would place it, then this recent runup has just increased the distance it must fall. A "meltdown" or severe shock requires that stocks become greatly overvalued first. IMHO they have. All we lack is the spark. I also feel that POG and POS will strengthen their inverse relationship with the stock markets in the near future, especially when fear starts to replace blind momentum (mania) investing.
Rich

http://biz.yahoo.com/rf/020309/t121984_2.htmlI don't mind telling you this last weeks action with the equity markets moving ahead...the CRB moving up...oil up...dollar down...AND of course---------gold down...was a bit hard to swallow.

Some very strange global manure being spread around these days....including the rally on Wall St.

ans: I do believe (in domestic equity market terms) we have just left the springboard, soaring upward rotating so impressively with triple spin...BUT...gravity will be calling the BEARass into the DIVE. No "W' recovery underwater. Judges holding up 9.0, 9.1, 9.3 9.2, 9.2 and 4.6 from the French judge.

Here's an even easier question...what's going on with the Nikkei?: Japanese government jam job..or..foreign investor insanity? ans: Both. Insanity is contageous.

Finally, a tough question: Who will get nuked first...New York, Washington....or half of the middle east?

As of late Japan seems to have been selling U.S. T-bonds to help support its economy, all be it strengthening the Yen in the process. Here at home, this would be a deflationary effect taking money out of circulation as far as I comprehend. As I understand it, these bonds and other various investment vehicles held by foreigners are part of their national reserves re-invested in our economy to earn a return. This is in addition to the massive amounts of dollars held by foreigners at home as national and exchange reserves.

Further this is where our negative balance of payments and national debt resides. So what is happening is that this debt is being called in. Dollars are being repatriated if not now in large amounts then in the future due to deteriorating economic activity.

This event would be one of the most important signposts that will lead the way to bigger events if not precipitated by them. Which ever it may be, my question is how do these massive amounts of reserve dollar debt come home to roost? How are they employed once back? What is the process? I would guess that it would be inflationary but am not sure though, that is why I ask. Any comments would be welcome.

Not only Japan, but this whole globe is stuffed and paved with US$ !!! Impossible to repatriate or exchange only a tiny fraction of this green paper dust, for whatsoever !
IMVHO, The Nikkei is maneuvered higher as to encourage follow up investment (?) simply to have much nicer figures at the end of march (The Bank's Books !). To prop up (artificially) the Nikkei, US$ are certainly repatriated (?)
...sold (to who) and there might be a risk that the artificial value (?) - price of the US$ might suggest weakness !? For this reason we see continious Gold (POG) manipulation to avoid giving the dollar (index) a trend-down pattern, with cascading consequences. We live in a very organized world, aren't we ?

The more things (US$) are managed / manipulated ...the closer we are to its "collapse". But this is nothing new and certainly not the present situation in Japan. See, the US$(index) chart with its ATH in 1985 + its 10 years of steady decline ! What a roller coaster for a currency that has the pretention to claim reserve status ! Put the growth and "stability" pact (succesfull or not -?) of the euro-builders against this perspective.
Japan has always masterminded / managed / manipulated its total financial/economic happening ! Now, Japan is completely in the ban of its only ally...the US$ faction.

It is exactly this "GIGANTIC" currency Gordian knot that is the one and only basis for the future gigantic Gold-Revaluation. We are just on the look out as to how bluntly and massively the manipulation-forces have (forced to) to operate to keep avoiding the detoriation process's momentum (or status quo). What better scenario can you dream of for keeping your (our) Precious Yellow in accumulation ?
Regards and nice WE.

Enron and Greenspan's Bubble

by James M. Sheehan

[Posted March 1, 2002]

The media/political movement for expanded accounting regulations is driven by the claim that more government intervention will "stop the next Enron from happening." Yet the existing rules did nothing to stop the real Enron. In fact, some of the worst aspects of the Enron calamity would not have happened without government intervention in the marketplace.

Regulatory intervention began during the Great Depression. The federal government mandated financial disclosure and established accounting standards, ostensibly designed to help investors identify sound companies. Back then, the government assumed that investors really wanted such information.

But what kind of information investors want on companies varies, depending on the circumstances, and such standards should be determined via market competition. Companies have every incentive to disclose any information that investors desire, if for no other reason than to persuade people to buy their stocks at the highest possible price. Requiring them to do so creates a false sense of security and discourages investors from demanding information for themselves.

During the 1990s, at the height of the Greenspan bubble, investors demonstrated most convincingly that they were not interested in well-managed companies. They were not concerned about profits, as evidenced by the fact that they bought Internet firms that had hardly any customers.

Even profitable companies issued pro forma financial results, meaning that they departed from normal accounting conventions in order to boost reported earnings. Numerous "restatements" of earnings were also reported, in which companies admitted to having provided misleading numbers. Investors swallowed these fake numbers willingly, speculating that easy money from the Fed would cause stock prices to inflate further still.

The government can try all it wants to mandate better disclosure, but this is just a Band-Aid that won't fix an unintended consequence of another bad policy: flawed monetary policy.

That audit firms like Arthur Anderson regularly went along with aggressive accounting tricks should not come as such a surprise. Such tricks were welcomed by shareholders as a way of lowering earnings as reported to tax authorities, which reduced their tax liabilities.

Had the government not overtaxed corporations in general and double-taxed dividends in particular, much of the accounting industry would not even need to exist. Here again, the government wants greater control over the audit and reporting process to address an outgrowth of flawed tax policy.

In Enron's case, outright fraud was used to bury losses and manufacture phony profits. Laws already on the books will be used to prosecute the guilty parties. Therefore, no additional regulation is necessary to put guilty parties in jail.

Indeed, it can be argued that existing regulatory agencies are not competent to detect fraud anyway. The crooks at Enron were caught, not by the SEC, but by hedge fund manager James Chanos. He read the company's financial reports and immediately realized that they were deceptive. The profit motive led him to short the shares and make a profit from exposing company chicanery.

In contrast, the SEC failed to act for years, even though it had the exact same information as Mr. Chanos, if not more. The agency failed to review Enron's public filings for four years, complaining that they were too complicated to understand. Under the Public Utility Holding Company Act, Enron was required to provide the SEC details of its various investments, holding companies, and off-balance sheet financing transactions. This law was mysteriously waived by the SEC in 1994, one of the many government mishaps that prevented discovery of Enron's fraudulent practices.

Those who desired information about Enron's regulatory disclosures would also find themselves stymied by the SEC's bizarre administrative procedures. The agency has voluminous files containing correspondence between companies and SEC accountants. This paperwork may contain material information concerning questions the SEC had about the aggressiveness of corporate accounting representations.

Yet investors do not have ready access to this data. In order to see it, they have to file cumbersome Freedom of Information Act requests. Then, they must wait patiently for months on end as the bureaucracy processes paperwork.

Much of the regulatory apparatus apparently broke down because lawmakers in Congress, who had received generous campaign contributions from Enron, pressured the agencies to be lenient. This is an inherent flaw in any political approach to regulation. No amount of political graft could convince James Chanos to go easy. The market eventually rewarded him nicely for revealing the truth after years of government lies about Enron.

Like the baseless arguments put forward for more accounting regulation, proponents of big government want more controls over 401(k) retirement plans--never mind the abject failure of Social Security.

The Feds now are angling to meddle further in a process whose flaws they created. For example, the law encourages companies to compensate employees using stock options without counting them as expenses on the balance sheet. For years, Washington did everything it could to "stimulate" private retirement savings. As a result, some Enron employees made bad decisions to take full advantage of these rules, and they overloaded on company stock. Companies could not hire investment advisers to recommend against overloading on one asset because of a flawed legal system that would hold the companies liable for the investment advice.

Fearing debilitating lawsuits, companies simply can't provide any investment advice to their employees. Post-Enron, Congress wants to restrict investment choices and put onerous requirements on the structure of company pension plans. The net affect of these changes will be to discourage companies from offering generous retirement matching programs at all.

The role played by maestro Greenspan and the Federal Reserve has been almost completely obscured during Enron's congressional investigations. After all, it was the Fed-inspired boom that turbo-charged questionable companies like Enron. With shaky companies sporting lofty valuations, healthy companies felt pressure to manage earnings rather than their businesses. They did so through various legal and illegal accounting tricks involving aggressive recognition of revenues. Profits were overstated, and earnings quality was abysmal. The Fed had debased all normal financial standards and benchmarks relied upon by investors.

Fed maestro Greenspan fully encouraged this process, not only through inflationary monetary policy but also through his widely publicized speeches and congressional testimony. He claimed that the bull market was due to a "productivity miracle" that he himself created.

Pronouncements of this nature fueled the mania and discouraged a close scrutiny of company fundamentals. Investment capital was misallocated toward companies with no visible earnings or real prospects. Speculators pursued Internet start-ups as well as the seemingly innovative but highly leveraged Enron.

Since the collapse of the Greenspan bubble, investors have placed a new premium on earnings quality and transparent accounting. The market is already acting without the passage of new laws by the grandstanders in Congress. Companies that were too aggressive in their financial reporting are being punished in the stock market. Since Enron, many other firms--notably Tyco, IBM, and GE--have had their accounting scrutinized. Even companies that merely pushed the envelope of legitimate accounting practices are being shunned.

Accountants and auditors are responding to consumer demands by getting tough on their corporate clients. Likewise, they are discontinuing technology and tax consulting work to settle conflict of interest concerns. The market is not even waiting for Congress to wrap up its Enron hearings--an embarrassing display of politicians' ignorance about business matters.

Opponents of the market say we have to stop another Enron from happening again. Yet all the government's watchdog agencies completely missed Enron. The system of cronyism in Washington, D.C., made the debacle possible and made it harder for the public to find out what was going on. Existing laws will put Enron executives behind bars, but they won't touch any of Enron's accomplices in Washington. They are too busy devising additional laws that pretend to protect us from fraud, while obscuring the biggest fraud of all.


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

James Sheehan is a financial professional in New York. He is the author of Global Greens (Capital Research Center, 1998), a book that documents government funding of environmental extremist groups. Send him MAIL, and see his Mises.org Articles Archive.

I vote for a sucker's rally. It seems to me that even if the economic reportage was as pure as the driven snow, i.e. earnings reports for companies reflected accurately their profit/loss, and PE's were based on unmassaged data, etc. that a resumption of a steady market climb would be unusntainable for long. How high could the Dow go? 20,000? 30,000? What goes up must eventually come down. Of course, I'm no economist, so my opinion is not necessarily worth much salt. I do know one objective fact for certain, though - Negra Modello is the best beer around! It's been my favorite for years. There's a 6-pack in the fridge as I write. Cheers!

Technical Interpretation of both XAU(HUI)/POG, living alone together :
See Hamilton for XAU/POG correlation factors .
Long Term momentums for both XAU/POG are in sync and positive (up) / for the time being ? Momentums of Both are still in a very nice contracting triangle with upwards baseline. This for the period 1996 (XAU=150) till now with the low of 2000 (XAU=40) included.
I still do see this as very positive patterns all together, XAU and POG ! Coiling up for a minimum break-out of grossly 100 points for XAU to 250 (?).
Remember the POG 8 years cycles (bottom to bottom) who hasn't been violated so far ! The UST-Bond-30yrs has pierced a LT resistance line and rising interest rates are on their way of breaking the fan-lines of their long term
price-patterns.

XAU/POG TI, suggests that overbought (?) conditions, short term, are / must consolidate (decline). POG 291$ >>> 284$ >>>280$ >>>270$ Make your choice (gamble).

So far w're still in the old fashion dollar-paper-gold-market with POG + 20% (250$ > 300$) and lots of miners + 100% thanks to a shamefull decline in their operating currency (Rand/Aus$/CND$). Do these currency debacles have any limits ? For how long can / must underground gold be plundered and looted ? Technical interpretation (triangle-coil) suggests that a TG-like explosion (hundreds of US$ in no time) is (still) very plausable.

This modest analysis of Technicals is worthless for Gold Advocates, who laugh with the 600$ POG consensus. This doubling could have been made even with bessy, recently (BS). Dow and Nikkei are escape valves for temporary adding confetti that isn't. Bear rally or New Highs only makes the difference between flagrant abandonmend of currency's intrinsic worth or the impossibility to fool a growing minority any longer. The financial brotherhoods watching each other very closely, whilst wagging the dog-economy.
Hamilton's P/E charts provoke no emotions to the masses STILL in full denial ! The present Gold accumulators must be pusched again in their state of DOUBT and RESERVATION !

http://news.bbc.co.uk/hi/english/business/newsid_1864000/1864994.stmsnippit:
Billionaire investment guru George Soros has said that it is "impossible" for Britain to reject adoption of the euro.
Mr Soros, whose currency investments have earned him a formidable reputation, warned that there were still concerns over Europe's single currency.
Harmonisation of taxes among EU states was needed to support a euro which was still "a work in progress", Mr Soros told GMTV's The Sunday Programme.
But he added that it would be "very difficult and very detrimental for Britain to be seen to be staying out".
"It's a quandary because it's dangerous to move in and particularly at what exchange rate and so on, on the other hand it's impossible to stay out," he said.

For bringing (ventilating) the message that the Britisch (former) Empire unhooks from Big Brother (US-substitute) and must / will choose for the Euroland-Empire in its very early stages ! My special thanks to the financial brotherhood(s) and Brother Rotshield's for having choosen Euroland (euro) as your (future) financial vehicle. Much appreciated.

Invisible, isn't it remarkable that all "FREE" american Gold(mine)-writers, never mention our euro in its capacity as a dollar-alternative ? Is euro-talk, a non-patriotic act ?
Or is the euro-Gold-oil > concept oh sooooh ....impossible ? And consequently un-important for any consideration and neglection of the 600$ and Thousands of US$ per ounce ? Strange, very, very strange indeed ! Oh yes, sorry...very recently POG projections have been adjusted to a 1.200$/ounce level on whatever basis.
But has history completely lost its rights and is a 1971-1980 repeat of 34$ x 25 = 850$ so out the question !?
What is it that's so different today ? Mammamia.

http://www.usagold.com/onlinestore/special.html

U.S. Liberty $10 Eagle

A "Premium" Opportunity

Call Centennial for details, or order online.
1-800-869-5115

http://chart.yahoo.com/c/1y/_/_merv.gifThe local stock market, while nearly doubling through the course of the actual devaluation (rising from 200 to 380), including the near-term buildup to the crisis, year-on-year the MERV has actually had a net DECLINE from a level of 480 to the current 380.

Stay tuned for Argentina's GOLD.

http://cchart.yimg.com/1y?XAUARS=XThe local price of gold has more than doubled through the course of the actual devaluation (rising from 280 to 600). And more importantly when compared to the stock market figures given early, during the near-term buildup to the crisis reflected in year-on-year gold values, gold did NOT suffer the net decline seen in stocks. It held its value through the crisis buildup, and then jumped in value as you see on the chart, thus performing better than stocks both in the "long term" (build up to crisis) AND in the "short term" (during the crisis).

With the end of march finally approaching(closure of derivatives and end of jap deposit insurance),they have once again moved to stem the buying of gold.We have to give the fed credit,anything we can think off they can.But if one looks closely you can see the moves of desperation.No longer do we hear words like "free market".Suddenly after bush's visit the nikkei explodes and the yen takes off,offering an alternative to gold,for now.JPM chase in trouble end of march?No! Dow and nasdaq explode just in time.Need to bring the price of gold down?NO problem Brundesbank to the rescue with a false announcement "we are considering maybe selling some gold perhaps maybe i think..." .They know most people dont look at facts anymore,just look at the dot com bust.So whats the good news?After this fails there are precious few more cards to play.To ad to usa's calamity bush will spend from the s.s fund to atifically pump the dow up.Although few see it,these are acts of desperation.They are putting all their eggs in one basket and praying it works.Why?Because the alternative is too much to bear.Oil is creeping up,greenspin will begin lifting interest in june?,war in the middle east?Pakistan/india,iraq,afghanistan,Japan mired in depression,argentina,enron etc and all of this will magically go away just like the record debt we hold.Lets all put our money in the markets and hope there wont be another terrorist attack.In other words lets all go for broke cause the fed knows those are the options.But what happens when the raise interest and no one borrows.What if this is the result of low borrowing costs and refinacing ?Everyone already bought their cars for cheap,houses too.All of this assumes people will buy at an accelerating rate as interest goes up expanding everyones debt.Dont worry about the debt(new economy) it will go away or else our children can pay it!Our society is bankrupt morally and financially,just living in denial,despite all the signs for just one more day!

Thanks for your feedback on my recent questions on gold perservation ie safe deposit box and fire dated Friday 08 March. When two of the big hitters of the castle take the time to answer a simple question from a small potatoes kind of guy like myself, its much appreciated. Those were some pretty awesome stats Boilermaker.

http://blacktusk.commerce.ubc.ca/cgi-bin/fxplotTownCrier (03/10/02; 06:16:38MT - usagold.com msg#: 71383)
When currencies devalue... Argentina's GOLD
---
The period between Dec. 2000 and mid Feb. 2001 is NOT a 45 Degree upward angled line !
<;-)

If confidence in our system is lost, game as we know it is over. Just like ENRON. Its all good and dandy. Its going to take more then just the boat taking on water. People will stay on board untill she goes under, just like ENRON. I can see it now. A major terrorist attack on us, and fail goes the system. Confidence is lost, books of banks blow. The Ship sinks and few get off on the liferafts of physical gold. Anyways I speak nothing new, my point is just to comment on confidence, and how it is our hole system. We see just that in how they are trying everything possible to keep the confidence. They either never had most of ours here, or they have lost it now. They even have to keep ones confidence up in our make believe gold markets. That fifth horseman will ride in as a totall loss of confidence in this system. How that will come about is working all around us at every moment for all to see everyday. Most will just choose to ignore the writing on the wall, and go down with the ship when she finally hits a rock and really busts open. Only in a society that morality has been eradicated through devises such as porn could ones be dumbed to this point.

http://blacktusk.commerce.ubc.ca/cgi-bin/fxplotGandalf,
I got a feedback "empty request" when I accessed the URL you indicated.
Regards.

Due to the intermediate official exchange controls during the course of the devaluation period, I'm guessing that the charting service simply threw in the towel on trying to represent the price of gold in pesos from point A in time to point B. During the brief two tier exchange period, they were probably undecided whether to represent the price of gold based on the domestic free market peso exchange rate or based on the official EX-RAT, so they seemingly said "to hell with it" and merely connected the dots on either side of the transition.

With (or without) that explanation, I hope you will nevertheless agree that the charts given remain both instructive and undiminished in bringing forth the point of my comments with respect to the starting values and ending (current) values of stocks and gold during this era.

R.

Thank you for the info/thoughts
Rich

http://www.nypost.com/business/43133.htm
RECESSION? What recession?

Snippit:

That's what headlines have insisted in recent weeks - and with good reason. Improbably, it looks as if the longest peacetime expansion in U.S. history has been followed by the most mellow recession since World War II. Some argue there was no recession at all.

Alan Greenspan, engineer of this apparent soft landing, could hardly contain himself before Congress last week, calling the nascent recovery a "truly remarkable performance by the U.S. economy."

But before we get carried away by all this exuberance, consider this potential cloud in the silver lining: Was this recession too shallow to purge the excesses of the bubble economy? And if so, are we being set up for a real bust down the road?


Black Blade: Surprisingly this article was penned by Terry Keenan of FOX's "Cashin In" and formerly a talking head/reporter on CNBC.

BTW, thanks to Strad Master the tally is now: Suckers Rally: 7 New Bull Market: 0

This question may sound a bit strange, but I'd like to have some expert opinion on the subject:

I know that some people, when accumulating gold, give a clear preference to little ingots to gold coins.

The reason they gave me was that the 1-5-10 gr. ingots :

- are absolutely standard,
- are sometimes even laminated (the gold part being protected with an indication of the manufacturing bank, and with the specification of their purity and weight). This somewhat constitutes an evidence of their authenticity, which is less obvious with coins.

On the other hand, if gold gets used as a "legal tender" again because of a crisis, rare coins may lose their interest - as only the weight in gold may become relevant. Last but not least, gold coins, rare or not, may lose some of their value if they have been damaged.

Does this make sense? What would the situation be if the worst comes to the worse, and if gold becomes heavily used again? Would only the weight be considered ?

Many thanks.

This week's Barron's has an article about JPM entitled "Weathering the Storm" by Andrew Bary.

The cover of Barron's has a photo of JPM's CEO Bill Harrison with the leader "Still Strong" "Shares of JPMorgan Chase have swooned as the banking giant has been bombarded with bad news, including big losses on Enron and Argentina. CEO Bill Harrison argues that panicked investors are overlooking his company's substantial strengths. He's right."

The three page article goes into the problems that JPM has encountered but the conclusion is that JPM is undervalued based on the worth of its parts and a forecasted EPS of $4.00 in 2003. I was struck by the number of "ifs" that appeared in the story, ie., USA economic recovery, Enron is an anomaly, fewer bad loans, better merger and underwriting business, no problems with the Chase assimilation, there are no more negative corporate credit events in the next few months,etc.etc.

But what really caught my eye was this paragraph,"One of the remaining worries at JPM is the fact that its portfolio of derivatives totals $24 trillion in national exposure, the largest of any U.S. financial institution. But the bank's officials say that the true exposure is $50 billion, and they add that they know of no time bombs ticking in that portfolio." That was the only reference to their derivatives. There was no explanation of how $24 trillion is really only $50 billion or what's in that portfolio.

The article is a whitewash by Barron's. Timing is suspect too. Looks like no one from this forum or any other JPM bears were interviewed.

If anyone is a Barron's online subscriber please copy/paste snippets, I'm a two finger typist.

Good week to all

http://news.bbc.co.uk/hi/english/business/newsid_1861000/1861947.stm
Snippit:

Wall Street's stock brokers are as depressed as the prices of shares in dotcoms, according to research by a New York student in clinical psychology. A study of male brokers in their 20s found they were three time more likely to suffer from clinical depression than men in other professions.

Would you trust them with your money?

He says 23% of his sample group were clinically depressed compared with 7% of men as a whole. But it is not just low share prices that bring psychological problems - when markets are riding high there is even more pressure for brokers to make large sums of money. It seemed their inability to control the markets can make them depressed and this macho environment, where they are not encouraged to talk about their feelings, the result is a sense of isolation.

Black Blade: As the article says: Would you trust them with your money? And in order to ward off any depression here in my cave, I'm off to the gym for a couple of hours.

I don't think that it matters much if we are talking about bullion. Gold is gold. I have both JM � ounce and various gram weight ingots. I also have maples, Krugs, Roos, and various gold medallions. Unless they are numismatic grade coin such as the Liberties offered here, then I would not be too concerned about minor imperfections. Numismatic coins are another matter. The value of numismatic coin is based not only on PM content but condition as well. So more care must be taken. I hope this answers some of your questions. Of course the Castle Guard could answer those questions in more detail. Cheers!

- Black Blade

http://www.usagold.com/ProductsPage.htmlCoins will always have a base value due to their gold content, but due to additional market circumstances (including such things as their "collectible" appeal as items that are in fixed supply, or potentially as the only form of gold with special exempt status during a government confiscation), the premiums for coins over and above the melt value of the gold content are more likely to rise from the current levels rather than fall. (And here I am speaking of the relatively common pre-1933's where the premiums are comparable to similar-sized bullion coins)

Here's a brief "case study" in what can happen to premiums due to market circumstances, thus significantly affecting the street value of coins even when the price of the gold contained within barely moves.

From 1933 to 1975 it was illegal for Americans -- arguably the free-est people on Earth -- to own gold. In the years following President Roosevelt's 1933 gold confiscation, however, there were legislative concessions allowing for the ownership of certain gold coins that have over time come to be recognized generally as the class of gold coinage minted prior to 1933. If you were an American in the 1960's or early 70's, and you wanted to own gold as insurance or an investment, these pre-1933 coins were your only option. So what was the market value of this "special status" coined gold?

On May 31, 1971, Barron's reported that the prior three years had marked a substantial increase in the value of certain gold coins. They cited that the U.S. "Double Eagle" had been selling at a 45% premium over its gold value in May 1968, and by May 1971 that premium had risen to 69% over its gold value. (The gold value at the time was officially set at $35 per ounce in defining the international dollar-convertibility for gold.)

In another example, the German Mark piece in May 1968 was selling for 75% premium, while in May of 1971 it had climbed to sell at a premium of 175% over the official gold value.

At nearly the same time, U.S. News and World Report indicated in its Sept. 25, 1972 issue that while gold bullion had been pegged at $38 per ounce as the official government price, the "free-market price in Europe recently has been nearer $65 or $70."


Bottom line: Let Centennial Precious Metals assist you with all of your precious metals needs. The friendly brokers know this market stuff backwards and forwards and are happy to consult with you in structuring your portfolio to meet your personal investment objectives. (And here I speak to everyone when I say "you" or "your".) Ultimately, it is your decision to do business with Centennial that makes this website available for your continued use.

R.

http://www.federalreserve.gov/releases/bulletin/0202assets.pdf
Hello, Jin-Yin. Pretty much all US foreign exchange transactions that are not handled via the "suitcase" method go through a big computerized system that's owned and operated by the US Federal Reserve. But it's not just a matter of controlling the flow. The link above shows that the Fed actually holds "in custody" a large chunk of Treasury securities owned by foreign central banks.

You ask "...how do these massive amounts of reserve dollar debt come home to roost?"

Dollar repatriation is a straightforward process. That is, until everyone wants to do it at the same time. See, the damage is not from simple repatriation. The damage will come from the "cashing in" of those repatriated dollars, or the conversion of the dollars into real things.

Financial assets are merely derivatives or substitutes that we hold because the holding of the underlying "real things" is inconvenient for us. Our system can probably handle limitless amounts of repatriated dollars going into financial assets. (Depositing money in a bank has never caused a crisis.) It's the withdrawal and spending of that money which will be the downfall of the dollar as it has ever been with paper money.

So, all that stuff we hear from our central bankers exhorting us to go out and buy an SUV would turn into horror if the world's people actually DID try to do that with their dollar reserves. It's only a matter of time, however, before this conversion happens. When it does the bankers at the Fed will turn off their computers in an effort to "manage" the crisis much like the bankers in Argentina did when they "managed" theirs. They will also seize "temporarily" the Treasury securities owned by those foreign institutions who don't possess the ability to force their conversion.

Banks and Banking: The Japan Situation

Most folks hereabouts understand how banks make their income. They accept deposits and make loans. The nature of the laws which allow a fractional reserve banking system say that a bank can take in, for instance, 10,000 in deposits + capital and create X times 10,000 in loans.

If a loan goes bad they can't "reverse the fraction" in fractional reserve banking. They have to "slice off" dollar-for-dollar or yen-for-yen an equal amount of capital. Thus, it's easy to see how banks can get into trouble if only a relatively small fraction of their loans go sour.

In an attempt to forestall the destruction of the banks' capital the Japanese monetary authorities are pumping up their stocks which make up a large part of that capital. When it comes time to mark-to-market they'll have inflated the amount of capital from which the accountants' knives will start their work.

The common Japanese man-on-the-street has every reason to be alarmed and confused. For, on one hand, we see their elected representatives saying, "We won't let the banks fail!" While, on the other hand, they're doing away with much of their deposit protection. It's no surprise the common folk are turning to gold after being publicly abandoned like this.

Regards,
Elwood

The world is not as you say:

"If a loan goes bad they can't "reverse the fraction" in fractional reserve banking. They have to "slice off" dollar-for-dollar or yen-for-yen an equal amount of capital. Thus, it's easy to see how banks can get into trouble if only a relatively small fraction of their loans go sour."

The fractional issue is a dilemma of reserves withdrawal. As affecting the system, loan default is little more than preterm repayment... provided the bank does the prompt write down (vs. carry to term). You think otherwise?

Thanks for the heads-up on the JPM article and for pointing out the many "ifs". I copied and posted it on another dicussion forum where I've been trying to defend the idea that some counterparty risk might exist here. I hope that's okay? The argument presented there, that there can be no risk at all, is based on the assumption that JPMChase is strickly an intermediary and collects transaction and accounting fees but assumes no risk. It is a grey area as they do indeed act in this manner but I believe they also trade "on their own handle" AND there are very few who have the financial power to be a couterparty to such huge dollar amounts. I believe many also are not aware that OTC derivative games are often played with few rules and without any referees. In more visible derivative trading there are regulations and margin requirements. This offers some assurance but, of course, comes nowhere near that of death and taxes.
Rich

"The fractional issue is a dilemma of reserves withdrawal."

Which, as events are proceeding in Japan, will flow through to the banks' capital accounts on a non-fractional basis, no?

"As affecting the system, loan default is little more than preterm repayment... provided the bank does the prompt write down (vs. carry to term)."

Then, it appears, the Japanese have nothing to worry about, eh? Why all the public hand-wringing?

Regards,
Elwood

http://pacific.commerce.ubc.ca/xr/plot.htmlPippin (3/10/02; 12:54:59MT - usagold.com msg#: 71388)
Gandalf - empty request message
===
TownCrier (3/10/02; 13:24:57MT - usagold.com msg#: 71389)
Gandalf: graphs
===
The graphing is done by entering the desired items as an axis on the graph from this PLOTING PAGE !
These graphs are VERY INTERESTING to watch and are very ACCURATE.
To see the EXACT conversions of one ounce of Gold bullion to ANY fait in any time period, just enter the "Base Currency" a "Gold Ounce" (near the bottom of the stack),
and the desired "Target Currency" (say Argentinian Pesos)
and hit PLOT !
WOWSERS !
===
AND yes indeed Sir TownCrier, you are sooo correct !
<;-)

Thanks for your time in posting an answer to my question. One more piece of the puzzle has been placed, at least in my mind.

Sir Belgian,

A nicer Oui, a definite accumulation is in order.

Sir Elwood, you stated: "In an attempt to forestall the destruction of the banks' capital the Japanese monetary authorities are pumping up their stocks which make up a large part of that capital. When it comes time to mark-to-market they'll have inflated the amount of capital from which the accountants' knives will start their work."

So the markets are now being manipulated to pay off fractional loans by the banks thus saving their backsides, although this is still a work in progress and not certain they can fool the average investor into giving up scarce capital to make their plan succeed. In my opinion, what inevitably will happen is that the Nikkei will look to go lower once the pump and dump, to whatever degree of effectiveness, is complete and the average Joe milked for more of his worth. Insidious state of affairs at the hands of the ones elected to serve and protect.

Interesting and again thanks for sharing your knowledge.

http://www.globeandmail.com/servlet/RTGAMArticleHTMLTemplate/C/20020308/whousingst?hub=businessBN&tf=tgam%252Frealtime%252Ffullstory_Bus.html&cf=tgam/realtime/config-neutral&vg=BigAdVariableGenerator&slug=whousingst&date=20020308&archive=RTGAM&site=Business&ad_page_name=breakingnews-businessA separate article cited 5 yr. mortgage rate increased from 6.85 to 7.30% due to inflation concerns.

It is so very ironic that not even a couple of weeks before Mr A.G. was using uncertain terms about the economy, but now all of a sudden he's very positive sounding. Is it possible to make that surprising of a turnaround? I think the U.S. Fed is using A.G.'s influence to get the lemmings to try to stimulate out of their own pockets, as it seems many are ready to buy on his word. What is easier than using someone else's money to make a gamble? What will they say after losing billions of dollars to false prophesy? Very interesting times my friend.

...or in the case of Barron's JPM weekend article...white washed.

The Wall Street "Journal" has morphed into a propaganda tool for the FED.
Who would have thought?

These are "Interesting Times". Yes indeed, suddenly Alan Greenspin is a very happy man. The US market indices are staging a bit of a turnaround much like the Nikkei 225. Something strange is going on. The US markets are grossly overvalued by any past historical measure and even while corporate debt is soaring and earnings are falling off fast into the abyss. What the heck is going on here? Something similar to what has happened in Japan perhaps?

Not long ago George "Dubya" Bush went on a trip to touch base with the Chinese leadership in Beijing. Along the way he stopped in Tokyo and Seoul. I don't think that he just stopped for a "spot of tea" and to Yuk it up with the Japanese Prime Minister Koizumi. This "visit" was just after new lowered bank deposit insurance guarantees were announced and Japanese citizens were snapping up kilo bars of Gold in a modern version of "The Gold Rush". Insolvent Japanese banks are teetering on the verge of bankruptcy (last year nearly 50 Japanese banks went tits up). The Nikkei 225 was also plunging in a severe Bear Market. What happened?

Shortly after Dubya's departure from Tokyo, the Nikkei suddenly rockets by several percentage points. This may be due to the new Japanese PPT shoveling billions of yen to prop up the Nikkei 225 and the desperate attempt by Insolvent Japanese banks to prop up the stock markets for "window dressing" purpose ahead of year-end financial disclosure on March 31. It should be noted that on March 31, Japanese banks must value shares at the market price and not at the purchase price. Suddenly there were new rules that were emplaced by Japanese authorities that restricted short sales by investment arms of banks - in particular foreign banks (sounds suspiciously similar to the TOCOM PGM defaults last year by dishonorable managers). If the Nikkei was allowed to remain at such low levels or even continue sinking, then a lot of confidence could have been lost resulting in a run on Japanese banks - however, this could still happen as the "April Fools Day" surprise approaches.

Oh to have been a "fly on the wall" during the meeting between Dubya and Koizumi during that "visit" in Tokyo not long ago. What was discussed" Obviously no one is talking. Could it have been a discussion about concerns of Japanese "interests" cashing in US Treasury Bonds? Could it have been about the weakening yen that could result in flooding US markets with cheap Japanese goods? A discussion of how the US version of the PPT (President's Working Group on Financial Markets) had kept the US markets in check. Perhaps it was a discussion about concerns of this disturbing "New Japanese Gold Rush" that had suddenly captured the world's attention. Perhaps it was all these things. Whatever was discussed the Nikkei soared to unimaginable gains in a short period of time. Could there have been collusion between the world's leaders of the two largest economies to inflate the market indices and to keep the "game" alive? Perhaps Bush and Koizumi are taking orders from others and are carrying out plans to keep the "game" alive. To me there is a rotten stagnant stench in the air and it seems to be coming from Tokyo, Wall Street and Washington DC. There is way too much coincidence for this to be "normal" market behavior.

- Black Blade

03/10 22:22
Yen Falls on Mizoguchi Currency Warning, Decline in Nikkei 225

Tokyo, March 11 (Bloomberg) -- The yen fell for a the Ministry of Finance's international bureau, signaled Japan may sell its currency to stem the biggest weekly gain in almost two years.

- - - - -

Last week in posting about the fall of the dollar versus the yen and the steel import restrictions, I mentioned that we weren't sure if the yen's appreciation was by agreement between Koizumi and Bush. The story now emerging is that things must not have gone well, and the two agreed to disagree to put it politely. It seems the Bush administration wants a weaker dollar and the Japanese are going to try to stop it from happening. We may be looking at a developing trade and currency war -- a good old- fashioned rendition of beggar thy neighbor.

If there was a lull in Japanese gold demand, I don't think its going to last long.

For some reason the Bloomberg story got scrambled.

Let's try that again:

03/10 22:22
Yen Falls on Mizoguchi Currency Warning, Decline in Nikkei 225
By Mari Murayama and Kanako Chiba

Tokyo, March 11 (Bloomberg) -- The yen fell for a second day after Zembei Mizoguchi, director-general of
the Ministry of Finance's international bureau, signaled Japan may sell its currency to stem the biggest
weekly gain in almost two years.

Tomorrow I will publish a new "Gold Myths and Realities" at the News & Views page (as part of our on-going series) in which we will reveal the answer to the following question:

Which are the three countries with the largest private investor gold holdings in the world?

Let's see some guesses just for fun. See if anyone can crack it. I think you will be surprised.

Note: This is private investor holdings -- coin and bullion.

Watch for the answer at News & Views tomorrow.

http://biz.yahoo.com/rb/020310/business_andersen_dc_1.html
Snippit:

NEW YORK (Reuters) - Prestigious clients are leaving in droves, criminal charges and billion-dollar lawsuits loom large, and peers hang you out to dry. That's the bottom line for Andersen, the accounting firm struggling to restore credibility shattered by its role in the Enron scandal.

Chicago-based Andersen, once the gold standard of its profession, signed off on Enron Corp.'s books and has been shaken to the core by the energy trader's collapse. ``I think at this stage, you would have to ask questions about whether or not they can survive,'' James Copeland, chief executive of Andersen rival Deloitte & Touche, told Reuters in an interview last week. ``I hope they do because I think the implications for the capital markets and for the profession itself would be terrible if they fail.''

Client defections are accelerating at Andersen. Longtime clients with prestigious names such as Merck & Co. (NYSE:MRK) and Delta Air Lines (NYSE:DAL) have dumped the firm as their auditor, and experts say more cop-outs are likely.


Black Blade: It's not easy being a criminal enterprise. Rumors are that Arthur Andersen has agreed to a plea bargain where the auditor will pay fines and give Congressional testimony about several other corporate frauds. Looks like "Interesting Times" are about to come to Washington DC and Wall Street. We should be reading more about this in coming weeks.

There is alot of near-spaced analysis going on here at this Gold Bug site. The world economy's direction is a given. They have always, without exception, inflated their way out of trouble. It will be no different this time. When inflation rears its ugly head at the consumer level, gold will rise like the sun in the east, no exceptions. They can cook the statistics, but they can't fix our deficit spending. Debt will be paid back with dollars worth far less than todays value, and we will all be happy once again.

My WAG!
United Arab Emirates
India
Thailand

I would venture a guess from lurking here for the past 5 years and picking all your brains. The three countries are:

Saudi Arabia
Switerland
United Arab Emirates

Love your contests !!!
Balzac

I'll venture to guess that India is the country with the largest individual ownership of Gold, though it is mostly in the form of jewelry. Of course recently there has been the revelation that most of this jewelry is "under karat". That is an under cover probe by Indian authorities revealed that much of what was thought to be standard 22K Gold jewelry is actually much less. Indians tend preserve their wealth in the form of Gold jewelry that is recycled periodically as planting season approaches and at harvest time the proceeds are put back into Gold jewelry. Recently the WGC has begun a campaign to sell "Hallmarked" 22K jewelry in India. All indications are that this so far has been a flop.

Next I would say that the US is the country with the next largest population of individuals who own Gold investments. This would be physical bullion. The reason being the relatively large population of individuals who are much better off financially than individuals in most other countries. Also there are likely more individuals in the US who invest in Gold shares and mutual funds. There is the large jewelry market in the US. The last several years have been good for Americans and some cash inevitably found its way into Gold jewelry even though it is most low karat Gold.

Finally, things get a bit sketchy for country number three. If the current "Gold Rush" in Japan is any indicator we could see higher numbers in Japan this year. Japan's Gold imports in January jumped 10 fold. This year China opens up the Gold trade and that could change the whole Gold investment picture as well. Then if FOA/Another are correct about the Gold for oil scenario we could venture a guess about the Gold holdings in the Middle East. That would put the focus dead on Saudi since they are the largest oil producer. They also have large Gold jewelry bazaars and soon degreed programs for Gold jewelry making. Again, like Indians, Saudi citizens have large Gold holdings in 22K jewelry form. So Saudi could be number three even though by population they are a rather small country but with a lot of wealth and a disdain for interest bearing paper investments. They tend toward tangibles and therefore Gold is one logical choice.

If we were to consider Gold ownership per individual we should focus on some very unusual places such as Dubai with its large Gold jewelry bazaars and where a Gold dinar is being considered for daily currency transactions. This "currency" may spread to Malaysia and a few other Muslim nations as well. Another country would be Ghana where traditional Gold ownership has been ingrained in the tribal cultures for generations.

I await to read the "Gold Myths and Realities" article tomorrow.

- Black Blade

http://biz.yahoo.com/rb/020310/business_markets_oil_dc_1.html
Snippit:

SINGAPORE (Reuters) - Oil prices extended a week-long rally on Monday after Iraq said it would not allow U.N. weapons inspectors to return, renewing traders' jitters about a showdown with the United States. Tensions between Washington and Baghdad flared again last Wednesday when U.S. representatives at the United Nations said Iraq was violating U.N. sanctions by converting humanitarian vehicles for military use.

Traders have become increasingly nervous about U.S. intentions over Baghdad and possible military strikes after President George Bush referred to Iraq in January as making up an ``axis of evil'' with Iran and North Korea which sponsored international terrorism and amassed weapons of mass destruction.


Black Blade: There still is the possibility of war in the region as plans were discussed about a possible two prong attack of 50,000 ground troops from the north and another 50,000 from the south with the possible involvement of Iraqi opposition members. Also leaked was discussion of Dubya's people researching the "nuclear option" to any conflicts around the globe. Meanwhile petroleum prices rose to $24.27/bbl for NY Crude and NG is at $2.80 Mbtu.

http://biz.yahoo.com/rf/020311/n11339495_1.html
Snippit:

NEW YORK, March 11 (Reuters) - Arthur Andersen LLP's advisers have approached rival Big Five accounting firms about acquiring some or all of the firm, and talks with Deloitte Touche Tohmatsu have occurred, the Wall Street Journal reported on Monday.

Black Blade: Arthur Andersen is finished.

Thanks for your answer. I contacted CPM indeed.

http://www.businessweek.com/magazine/content/02_11/b3774005.htm
Snippit:

Despite a spate of favorable data, pessimists argue that the U.S. faces a long period of slow growth--or even a "double-dip" recession. They worry that the mild 2001 downturn left in place the imbalances built up during the late 1990s. "The recession was too shallow to create the efficiencies that a longer, deeper recession would have," says Donald H. Straszheim, president of Straszheim Global Advisors in Westwood, Calif.

Many economists believe consumers are getting tapped out even as the stock market and housing remain overvalued. And they worry that households and companies have overborrowed, while the U.S. is getting too deep in debt to the rest of the world. Says Morgan Stanley Dean Witter & Co. Chief Economist Stephen Roach, dean of the double-dippers: "The case for a double dip is just as compelling--if not more compelling--than a couple of months ago."


Black Blade: Definitely a "Suckers Rally". This is another good article that outlines what I, Jim Puplava, Lance Lewis, and many others have been saying for the last couple of years (some even longer). The excesses have not been squeezed out of the market yet.

What's so important about this :
- Soros = A messenger for financial masters, wanting to spread their message / agenda across !
- Timing : End (?) UK Gold-reserve sales ! (rumors on further sales-?). Perhaps it was Welteke (Bundesbank) who took over some burden of the CB Gold-selling impression, job !?
- UK : Leaving the dollar-faction ! Why should they ? (haha)

Reread 2 TG msgs :
- #35569 respons to Cavan Man and theories on LBMA, evolving today, exactly as outlined in 8/26/2000.
- # 35549 respons to Henri, with perfect shematic overvieuw
of 1980 >>> 2000.

USAGOLD : Is it private Gold holded per citizen ? Or total private Gold holdings ? Thanks. Am very curious and it certainly might surprise us all.
India : Estimated 10.000 tonnes for 1 billion people.
Arabian oil states / Russia / Asians / etc : Is it possible to make any reasonable guesses with the enormous flows of unknown Gold ? France, Italy, Belgium always had packs of Gold-Philes in the past. No idea what's left of it. Am impatient to know.

http://www.kitco.com/charts/livegold.html
Interesting chart this AM. Not a bad start. Now if it only maintains momentum from here. Currently up +$1.40.

Holtzman has discussed this topic in detail in the past.As I recall,he felt the main thrust of the BOE sales was a strategy to lower the pound's value for Euro entry.

Now,what about this 15% rule?

http://hsgfx:reciprocal@www.hussman.com/hussman/members/updates/latest.htm
New bubble antics,maddening isn't it?

These people(Wall St.,The Fed,the media)really ought to know better.Good comparison in here to the 81-82 double dip recession,that one was a doozy.


What are your thoughts on gasoline and refinery outputs for this spring and summer?

A sudden and prolonged jump in gas prices could bring out the Gatorade bucket.

http://www.mrci.com/qpnight.asp
Gasoline prices usually rise in the spring due to increased travel, also known as the "driving season" on Wall Street. However, spring is also the time of year that many refineries shutdown for scheduled maintenance. This is also the time that gasoline and other distillate inventories are built up in anticipation of "driving season". The problem is that these inventories are not being built up to any significant levels.

The other wild card in all this is the increased tensions in the Middle East with the Israel/Palestine conflict heating up, talk of US military action in Iraq, Wahabi Muslim fundamentalist rumblings against the Saud monarchy, and recent increased tension and conflict among the regional Caspian states (particularly Chechnya, Russia, Turkmenistan, Georgia, Kazakhstan, Uzbekistan, and Iran). The whole region of the Middle East and Caspian/Asia Minor is a powder keg ready to blow up at any time.

Meanwhile, NY Crude is higher at $24.39/bbl and NG is at $2.80 Mbtu. Maybe we need less dependence on foreign oil. We will likely always be held hostage to foreign interests due to our addiction to hydrocarbons. If fuel cell technology ever becomes viable then we will use more NG than Oil distillates (just trading problems as supply of both is limited). Of course we will also need a more abundant and reliable source of PGMs for this technology. BTW, platinum continues to surge higher with high lease rates and now at $527/oz. Japanese continue to buy platinum and Russia isn't delivering again - no kidding. Cheers!

- Black Blade

I just watched an Interview with Steve Forbes on FOX, He said in effect that the Fed must increase liquidity to kick the US economy into high gear. He said that the proof of this is in the POG. He would like to see Gold above $300/oz. and hold at least $320/oz as proof. I can't argue with his reasoning though the result would be higher inflation (even with statistical filters such as hedonic deflators and "chained CPI").

- Black Blade

http://quotes.ino.com/exchanges/?c=metals
Gold is moving up nicely ahead of the NY open - up +$3.00 and Brent North Sea Oil higher by 64 cents. Could shape up to be an "Interesting" day on Wall Street.

- Black Blade

For some reason the last week was very important to lower POG below 290.Must be option related :-(

What happens to the Nikkei (and other markets) after Apr. 1?

I refer to 'the shovelling of cash' and the restrictions of short selling. If short selling is reinstated would the Nikkei not plummet since its pre-manipulation was in the order of 10,000?

Can you venture a guess to the outcome of the currency devaluation between the USD and the yen? Will the J.A.Pan company wait until after Apr. 1 to devalue yen?

TIA

World energy production is for the most part in the "hunter-gatherer" stages using an analogy from the era that pre-dated agriculture. We have exploited and continue to exploit the easily found and naturally occurring energy resources such as oil and gas. In the US, many of the shallow onshore fields are substantially depleted (the low-hanging fruit is the current popular analogy). We need to go deeper and further offshore to find new reserves and into hostile places like North Slope and ANWAR. This is very expensive compared to the huge and easily produced Middle East resources and it is not surprising that the US is losing ground in its energy self sufficiency.

The free market will buy at the same market price regardless whether the product comes from a low cost producer or a high cost producer. The low cost producer's market share will increase at the expense of the high cost producer. The high cost producer will deplete their reserves and be unable to justify the capital investment needed to replace them.

If energy self sufficiency for the US is strategically important(which I believe it is) then the only way to acheive it is to have higher prices for energy. $25/bbl oil and $2.50/Mcf gas will not stop the US decline. Probably about $50/bbl oil and $10.00/Mcf gas would arrest the decline and grow the supply to self sufficiency. Part of the matching of US supply and demand would come from reduced consumption and part from new supply. Much of the new supply would come from non-conventional sources, eg., coal bed methane, oil shale, tar sands, coal to gas, coal to oil, etc. We would be forced to go from the hunter-gatherer mode of energy production to a technology based approach equivalent to modern agriculture.

The US has abundant supplies of hydrocarbons such as coal that can be processed into the more useful forms of energy, oil and gas. We already have much of the technical expertise and some experience with this technology. Eventually this will have to be done because even the reserves of the low cost producers will deplete. There is no alternative in the long run. Why not bite the bullet now, let domestic prices rise and invest in these technologies rather than spend the money on a military presence to secure our foreign sources?

$50/bbl oil would give us $2.00/gal gasoline. I can live with that and many others can also. Europeans have paid twice that much for many years without too much whining. Their problem is that most of the high cost of gasoline goes for taxes, not to the producers. Big cars and bigger houses are not a American birthright to be subsidized by cheap foreign oil.

Oil and gold going up. Fill up and load up while you can.

http://www.mises.org/fullarticle.asp?control=908&month=42&title=Defining+Inflation&id=42Good article on inflation and increasing consumer prices which are mutually exclusive however seen as the same animal today.
_____________

While increases in money supply ( i.e., inflation) are likely to be revealed in general price increases, this need not always be the case. 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, no visible change in prices might take place. In other words, while money growth is buoyant--i.e., inflation is high--prices might display low increases. Clearly, if we were to regard inflation as a general rise in prices, we would reach misleading conclusions regarding the state of the economy.

On this, Rothbard wrote, "The fact that general prices were more or less stable during the 1920s told most economists that there was no inflationary threat, and therefore the events of the great depression caught them completely unaware" (America's Great Depression, Mises Institute, 2001 [1963], p. 153).
_____________

How do they manipulate prices by 'pulling things in an opposite direction to monetary factors' which 'displays low increases?' Sorcery?

By lowering trade barriers, such as NAFTA in the US and the introduction of the new technologies that allowed many things to be produced in new countries all around the world. This plus the ability to substitute one product for another gives you a lot of lattitude in moving in that direction while money supply is growing and the increase in the general price level is muted for awhile.

India
USA
France

I would first like to thank ALL of the posters for their willingness to share their advice and information ... I have been a steady reader here for several years, mainly because I get a more complete view of the world from the posters here than any other place on the web.

That being said, I would like to strongly recommend the following books, as they have done more to help me understand the world and the future of finance (and of course gold's place) than any others.

The first being 'The Fourth Turning' : http://www.fourthturning.com

and the other, by Jeremy Rifkin, entitled : 'The End of Work'.

I have pasted a synopsis of the book below, but in view of the current Japanese crisis, I think it holds a lot of valuable pieces of information.

In my classes, I tell my students about a new Japanese factory for making TV sets ... output is over 5000 sets a day ... want to guess how many workers are employed at this new state-of the-art complex ?

the answer is : 5.

You do the math ... any way it comes out, automation is the end of most jobs, and a surefire indicator of the Great Deflation to come.

And on a personal note, just what skills does anyone have that cannot be done better by a machine ? Not many I think.

Best of Luck to everyone in the future ... it's gonna be amazingly strange and wonderful place (I hope :)

M

IN HIS COMPELLING, disturbing, and ultimately hopeful book, The End of Work (1994), Jeremy Rifkin argues that we are entering a new phase in history-one characterised by the steady and inevitable decline of jobs.

Worldwide unemployment is now at the highest level since the great depression of the 1930s. The number of people underemployed or without work is rising sharply as millions of new entrants into the workforce find themselves victims of an extraordinary high-technology revolution. Sophisticated computers, robotics, telecommunications, and other cutting-edge technologies are fast replacing human beings in virtually every sector and industry - from manufacturing, retail, and financial services, to transportation, agriculture, and government.

Many jobs are never coming back. Blue collar workers, secretaries, receptionists, clerical workers, sales clerks, bank tellers, telephone operators, librarians, wholesalers, and middle managers are just a few of the many occupations destined for virtual extinction. While some new jobs are being created, they are, for the most part, low paying and generally temporary employment. More than fifteen percent of the American people are currently living below the poverty line.

The world, says Rifkin, is fast polarizing into two potentially irreconcilable forces: on one side, an information elite that controls and manages the high-tech global economy; and on the other, the growing numbers of permanently displaced workers, who have few prospects and little hope for meaningful employment in an increasingly automated world.

Rifkin suggests that we move beyond the delusion of retraining for nonexistent jobs. He urges us to begin to ponder the unthinkable - to prepare ourselves and our institutions for a world that is phasing out mass employment in the production and marketing of goods and services. Redefining the role of the individual in a near workerless society is likely to be the single most pressing issue in the decades to come.

Rifkin says we should look toward a new, post- market era. Fresh alternatives to formal work will need to be devised. New approaches to providing income and purchasing power will have to be implemented. Greater reliance will need to be placed on the emerging "third sector" to aid in the restoration of communities and the building of a sustainable culture.

The end of work could mean the demise of civilization as we have come to know it, or signal the beginning of a great social transformation and a rebirth of the human spirit.

Available online to all clientele and prospective clientele, NEWS & VIEWS Forecasts, Commentary & Analysis on the Economy and Precious Metals has again been updated.

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http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3CK31DNYC&live=true&tagid=IXLYK5HZ8CC(Partial)
US warns steel trade tensions may spread
By Guy de Jonqui�res and Edward Alden in Washington
Published: March 10 2002 21:22 | Last Updated: March 11 2002 01:14



The US administration has warned that strains in international trade relations could spread from steel to other sectors unless the European Union and Japan reflate their economies.

Grant Aldonas, under-secretary of commerce for international trade and one of the architects of the decision last week to impose steel tariffs of up to 30 per cent, said other sectors affected could include agriculture and semiconductors.

In an interview with the Financial Times, Mr Aldonas said: "We have told people over time that if you don't see stronger growth abroad, you end up seeing friction on the trade account," he said. "There is only so much patience that you have when you are talking about very serious macro-economic issues that have been out there for a long time."

This is the first time the Bush administration has linked the steel measures to larger problems in the global economy.

Mr Aldonas indicated Washington was determined to stand firm in the face of the international outcry its steel measures had provoked. "This is one of those situations ... where things have to get worse before they can get better," he said

Reference is frequently made to the necessity to buy pre-1933 gold coins to prevent confiscation.

Question a) I wonder if the exemption granted to those coins in the past will be reconducted in the future. Do we have hints or indications that the rules of the road will be the same, the day the thing hits the fan ?

Question b) This rule of "pre 1933" was/may be valid for the USA. Do we have any indication about European countries (within and outside the European Union ?

Thanks.

http://www.observer.co.uk/waronterrorism/story/0,1373,665114,00.html(Part)Bush wants 25,000 UK Iraq force
Britain considers joint invasion plan
America has asked Britain to draw up plans for 25,000 of this country's troops to join a US task force to overthrow Saddam Hussein.
In a move which reveals advanced US plans for the next phase of its war on terror, Government departments are considering the plans ahead of Vice-President Dick Cheney's meeting with the Prime Minister tomorrow.

Cheney will come to London armed with fresh evidence against the Iraqi dictator, and will tell Tony Blair that United Nations inspections of Iraq's nuclear, chemical and biological weapons may not be enough to head off a new war in the Gulf

That explains a lot more besides the current manipulation of gold. For awhile we wait.

If not sorcery, then how about �The New Alchemy�? How else can anyone explain the ease at which these trade agreements are passed without much ado about the damaging consequences to our production base? All in an effort to keep consumer goods, the price of gold and oil to supposedly politically correct levels and ultimately to keep the game going and the chips flowing at the Casino. Meanwhile inflation manifests in stocks and housing to keep us fat and happy. In the end, the politicians and media will blame citizens greed, ignorance, and lack of concern over frugality that will have gotten us into the mess in the first place. We will bow our heads in guilt as the media will have already formed our opinions and this will become truth.

He who controls the past, controls the future. He who controls the future dictates the present; something to that effect. Very few are aware of conditions preceding 1929 as our history of that time is long gone to memory heaven. Even possibly done by design. The similarities are unsettling. A new mix of frog legs and pup dog tails has been brewing for some time now.

At least being aware of future possibilities is more interesting than being hit from behind by a freight train full of spoon-fed ignorance. Thanks to all for answering questions and contributing to this great forum.

http://cbs.marketwatch.com/news/story.asp?guid=%7BC85B01A9%2DB1B0%2D4D62%2D875D%2DF186F952994D%7D&siteid=mktw
Wall Street showing signs metal may rally

Snippits:

SAN FRANCISCO (CBS.MW) - Gold-timing newsletters are increasing their recommended exposure to bullion in a move that could prove prophetic. Still, with tension building in the Middle East and the dollar undergoing a rare bout of weakness, analysts are coming round to the prospect that gold will stage a major advance in coming weeks.

"The dollar, which has been so strong for many years even during this current downturn, is beginning to show signs of deteriorating, and one of the beneficiaries of this is usually the gold market," Lomma said in a new report that is beginning to make waves in Manhattan investment circles."

"The United States, for many years, has been a magnet for foreign investment," Lomma reasons. "This investment trend may be coming to an end. Many major countries are beginning to reinvest in their own lands once again, leaving the safety of U.S., dollar-denominated assets. A falling dollar, and with it higher gold prices, often signal commodity inflation in many natural resources, including steel, oil and even agricultural products. Lomma, charting a 22-year "down-trend" for gold prices, is very optimistic about the metal's strength.


Black Blade: Surprisingly quiet on Wall Street as most activity is centered on the 6-month anniversary of the WTC terrorist attacks. These certainly won't be the last such attacks either. No one can win a conventional war against the US anymore. However, we can't win a war against terrorism either. The face of war has changed. Now it will be a war of attrition with car bombs, suicide bombers, hit and run snipers, toxic chemical dispersal, and even possible dirty nuclear bombs as the weapons of choice. With the commitment of people who are willing to sacrifice themselves like this, we cannot win. They even strike at the financial centers of the western world. The next targets are likely to be the financial infrastructure of the US and Europe, and the major cities of Russia as Caspian region Islamic fundamentalists take on the Russian bear. There is also the very real possibility of a suicide plane attack on a major Saudi oil terminal in an effort to cripple the western economies and the economy of the perceived pro-western Saud monarchy. These are "Interesting Times" indeed.

http://www.usagold.com/cpm/hoppe.htmlThe link above is a page to address many of the confiscation issues. Most importantly is the comprehensive memorandum of legal precedents that can be obtained at no charge by request. You'll find it at the bottom of the page following some helpful historical commentary.

R.

PS. Not long ago MK offered the following comments on this very subject:
---
1. Gold ownership [as viewed by political leadership] in the United States is a privilege not a right as
Rep. Ron Paul has asserted the result of his own experience in trying to
get gold-owner favorable legislation through the Congress. No matter
what you think is right, or what you think is moral, ethical or legal,
that is the reality that we must deal with. What you do politically to
alter that is your business, but where the rubber meets the road is how
you design your gold portfolio in the first place to maximize your
ability to hold on to the gold you purchase.

2. The concept of ownership of pre-1933 gold coins as the safest form of
gold ownership with respect to the current law is borne of much legal
research and legal precedent, but it is not a guarantee that you will be
able to keep your gold if you own it in this form. However, it offers
the best odds that you will be able to retain your gold in the event of
a call-in. From 1933 when gold was criminalized and 1975 when it was
re-legalized, gold owners could own and trade in pre-1933 gold coins
like there was never a confiscation in the first place. You just had to
know and understand this loophole in the law. I encourage you to go to
the link above and request "You Can Survive a Potential Gold
Confiscation." All the reasoning is there in detail along with the legal
precedent (as Appendices) required for you to understand why moving in
this direction may be your saving grace. This is not a casual report the
basis of which we pulled out of thin air. It is built on the work of
intellectuals and gold advocates who have gone before us and laid some
very important foundational work -- including Donald Hoppe and H.M.
Holzer, Ayn Rand's attorney.

3. The Treasury Department will not come to your door knock on it and
demand your gold. They will simply make it illegal to trade in it and
that's all they need to do. When Roosevelt put the kabosh on gold, all
he was concerned about was bullion because he feared huge stores of
money leaving the imploding banking system for gold. (Consider how the
Argentinian government reacted similarly in their recent financial
meltdown). The U.S. government let the pre-1933 coins go because they
did not pose a threat to the currency controls the Roosevelt
administration was imposing. These are serious considerations that every
gold owner need understand.

4. You do not have to pay exorbitant premiums to get into this kind of
material. Some think you have to buy exotic coins with a Grand Canyon
between the metal value and what you pay. That simply is not true and we
can guide through this aspect of the process. Please call George Cooper
or Marie Ballard who are well versed in these matters.

5. As for Canadian, British and European laws at the time, we do not
know at this time, but we are hoping at some point in time gaining some
knowledge in that respect as our clientele grows in those countries. I
believe that the Nazi government in Germany confiscated gold, but I
don't know the details, just the Hitler quote that "anyone who deals in
gold should be marched off to the camps" or some such nonsense. Let me
just say this: For the premium you would now pay for pre-1933 gold coins
at a time when the gold price is artificially maintained at historically
low levels, it is a small price to pay for the peace of mind. When gold
moves as most of us think it will, that premium will be obliterated and
you will be glad you've done everything you can to protect your
holdings. Believe it!

There is much more I could say on this account, but I'll leave at this
for now. The ill-founded and unfair ties that the U.S. State Department
recently made between gold and terrorism were a warning shot across the
bow for some. It reminded us all how easy it would be for an
unscrupulous government to mount an attack on gold based upon erroneous
presumptions. Their real goal would be to limit its dissemination among
the population. These are important discussions now being entered into
at this forum. I only hope to provide some foundational thinking. Be
disciplined, my friends. Consider your alternatives as best case
scenarios not absolutes. There are no real guarantees as most of you
understand. One just does the best they can under the circumstances and
hopes for the best. Pre-1933 world gold coins fit those criteria. I
don't speak about this often publicly. This is the sort of thing I share
with our clientele normally in private. --MK

http://www.usagold.com/gildedopinion/Jensen/20020309.htmlExcerpts:

------------Refugees fleeing hunger and political violence are braving crocodiles, barbed wire fences and South African army patrols in a desperate bid to escape across the southern border.

Seemingly unfazed by...[social/economic]...disaster, Mugabe says many of these problems have been "manufactured" by Britain and Zimbabwe's tiny white minority of 70,000. He accuses Tsvangirai and the MDC of being stooges of the whites, intent on returning the colonial era.

Tsvangirai, a former union leader, responds with one simple question: "Why is a country that was once the bread basket of Africa now a basket case?"

Two recent polls, one by the independent Financial Gazette newspaper and the other by a private institute headed by one of Zimbabwe's leading political analysts, show that Mugabe's popularity has plummeted and Tsvangirai would easily win a fair election.

But Mugabe's rubber-stamp parliament has rushed through electoral amendments forbidding civic and religious organizations from monitoring the poll. Military officers have been appointed to the election commission and only civil servants -- dependent on government jobs -- will be there to guard against irregularities.

Zimbabwe's Supreme Court struck down some of the amendments last week but Mugabe simply reinstated them by presidential decree. Opposition spokesmen say that's an open invitation to ballot stuffing.-----------

(click URL for full article)

Could you please claify a point....I know I read that one consideration of whether a coin is numistic is that it have a value at least 15% over melt...does this hold for pre 1933?

http://markets.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3QI2WBKYC&live=true&tagid=IXLTEW9YICC⊂heading=bonds
Snippit:

Japan's sovereign debt rating is almost certain to be downgraded, Moody's, the credit-rating agency, said on Friday. The agency, which put Japan on negative outlook last month, said Tokyo's rating would probably fall a notch, but could drop further, which would be below Botswana, an African country ravaged by Aids.

Black Blade: On that cheery note, I have to admit that I find the market action quite entertaining. US and Japanese corporations had better produce some profits or there will be a lot of disappointed investors. Of course big investment banks and their analysts could be open to a storm of lawsuits if investors go on the hunt for someone to nail to a cross. Obviously there is no way that most US corporations will even come close to bringing home the bacon as it were under these current lofty valuations. As far as the Japanese economy is concerned - what a basket case. "Interesting Times"

Trail Marker #125 10/25/01
Snippet:

------Blair says 2002 EU summit key for euro, economy -----
Thursday October 25, 2:41 PM EDT --

LONDON, Oct 25 (Reuters) - British Prime Minister Tony Blair said on Thursday the success of the euro and the wider European economy hinged on the EU's ability to push through
long-discussed economic reforms next year.

Blair, launching a Belgo-British conference in London, earmarked the European Union's Barcelona summit next year as a key staging post and said the success of the launch of euro notes and coins was crucial not just for the 12 euro zone members but for Britain too.

"We have an interest in this," he said, stating his policy that in principle his government wanted to join a successful single currency.

"Barcelona will be critical in how the world views the development of the European economy," Blair said.

If the summit is a success, it will help make the euro a success, he said.-----------------

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

Another thing we can count on and I mentioned this before:

The moment England is seen as even a "virtual" member of the Euro club; the world will jump on every physical ounce of gold available at whatever dollar amounts anyone will part with it,,,,,,,,,,,,,,,,, and sell every paper gold play into the dirt in the process!!

I say, know your dealer, buy your bullion early and watch for this act to begin. It's closer than you think!
------------

Will we finally see some type of ECB "announcement" or "leadership statement" in regard to Gold/USD??
With the Euro now complete, these guys need to get their act together or continue to lose credibility.

China and France : Justice Yes. Disproportionate retaliation with an agenda, No. The US occupation in Central Asia, will not be tolerated. Iran, explicitely inviting Euroland for Middle East mediation, independantly from the US ! Bush not impressed at all (rememberance speach). POO touched 24$ (up 20% from 20$ low).
Saudi Arabia : Saddam can't be ousted without Israel/Palestine solution !
It is the rift between US and Euroland that is important to the Gold evolution. Not the high probability of war as such.

Old Yeller: UK can lower its pound, without the (virtual) sale of Gold reserves. What if UK-Gold was sold to ECB/BIS and temporary booked in an under the ledger construction, as transitional for later EMU-entry ? To move a currency or interest rate, just call the financial brotherhood for doing the job !

Thanks for asking, and that's a very good question. But I assure you, your confidence in me (to answer it) is misplaced. My specialty (if it can be called that) is banking and monetary systems -- through which avenue I've come years ago to understand the vital importance of gold both within the system AND as a bastion of private wealth. (And hence, sometimes, when my incompetent web-coding skills are not being overwhelmed by various site update requirements, I even get to share a monetary tidbit or two here at the forum. But to be sure, numismatics are quite beyond my field.)

So, getting back to your question, all I can say is that when I can occasionally back my truck up to Centennial's doors, I prefer to haul away great quantities of coins such as the sovereigns or Swiss francs while paying low to modest premiums. And for certain, Centennial has the full spectrum from bullion to professionally-graded high-premium numismatic/collector gold available, too.

The bottom line, if you want the whole breakdown from someone with professional competence in the wide ranging field of gold investments including numismatics, I strongly suggest that you give a call to the brokerage staff in the USAGOLD/Centennial office. That's precisely what they're there for. (And with that, I'm off -- I've got some web pages to mend.)

R.

http://vlib.unitarklj1.edu.my/htm/islambank9a.htmTownCrier - Many thanks for your very detailed answer. Looks I have to go through some reading indeed...

Something else, if I may. I just remembered the above article (along with its second part http://vlib.unitarklj1.edu.my/htm/islambank9b.htm).

The article was written in 1998, but certain sentences make it quite up-to-date given the circumstances :

Quote
Inflation-deflation is known as Riba al-Fadl in the Islamic world and it is prohibited. By establishing an economic bloc under a gold standard, the Islamic nations of the earth could eliminate currency fluctuations and establish the interest-free banking system that the Qur'an mandates.
UnQuote

I must confess that were I a moslem person, I could not help finding some interest in this idea. Would it be plausible in the present economic situation? A gold standard centered around a religion?

Holtzman posts on the UK and euro issue,10/25/00,12:07 and 10/10/00,12:02,civil engineering.It's excellent reading, not only on the BOE/euro issue.

http://www.usagold.com/wgc.htmlCheck out the chart in the latest weekly gold market update. You'll see ample evidence of a price-performance trend for gold in both dollars and yen, now being a good buying opportunity within that same trend.

R.

India, Switzerland, then France? So many choices, so little chances!

http://www.morganstanley.com/GEFdata/digests/20020311-mon.htmlAlso read the pieces following, on bonds entering bear market, and inflation expectations.

http://biz.yahoo.com/ap/020311/carrier_job_cuts_1.html
Snippit:

Carrier to Close Plant in Tennessee and Cut 2,000 Jobs by End of the Year

Black Blade: More nonessential "Bones" shuffled off to the ever-growing "Bone Pile". Too many from smaller compnies to list.

http://www.usagold.com/cpmforum/archives/2620008/default.htmlThanks for bringing these forward #35569, and Henri's 35549.

"This currency systems and the evolving nature of our current society that created this system is in the process of radically changing it's paper wealth structure. The government, as an extension of that society begins to support and maintain the asset value of almost everything. This is the engine that drives an eventual hyperinflation. Not a typical business expansion inflation we are used to,
rather an all consuming, ending inflation that does not stop. At this point the concept of sound money takes a back seat to maintaining majority asset holdings on a permanent plateau. By extension, the official stance is moved to promote all paper assets as "national money". Stocks, bonds, business function and even general welfare is elevated to an equal footing with the need for a good sound money in your pocket. The mood becomes one of "what good is a sound dollar if we are deflating"? Check that one off your list because we are well on that road."

http://member.usagold.com/commentaryreview.html

Gold Myths & Realities

Myth: The biggest holders of pivate investor gold are people living in third world countries with a history of currency problems, not industrialized countries like in Europe, the United States and Japan where investors can utilize modern, sophisticated and diverse
equities markets to hedge various economic uncertainties.

Reality:The big industrialized countries sit atop the rankings of world gold owners. The French at 3600 tonnes rank first. When combined with fifth ranked Germany, the two European Union powerhouses control nearly one quarter of the world's bullion and coin. The United States ranks second after racking up two big acquisition years in 1998 and 1999. Surprisingly, Japan ranks third and that's before the huge buying spree launched by the Japanese people over the past six months.

Chart Courtesy of the World Gold Council / London

http://story.news.yahoo.com/news?tmpl=story&u=/nm/20020311/tc_nm/telecoms_avaya_outlook_dc_4ppit:

CHICAGO (Reuters) - Communications equipment maker Avaya Inc. on Monday said it will cut its work force by more than 8 percent (1900 jobs) and sell a minority stake in the company to Warburg Pincus Equity Partners as it adjusts to a lowered sales outlook amid the slowdown in communications spending.

Black Blade: Yep, more nonessential "Phone Bones" off to the "Bone Pile". That's OK though as they will be "seasonally adjusted".

France at number 1? Who would have guessed? I suppose so. It was during the 1960's that the French government under Charles De Gaulle was cashing in Gold-backed US Dollars for the "real thing" until Dick Nixon slammed the window shut. Hmmm...

- Black Blade

http://biz.yahoo.com/ap/020311/qwest_sec_4.html
Snippit:

Securities and Exchange Commission Requests Documents From Qwest Communications

Black Blade: More Enron's? It appears that not only Qwest is under investigation, but that WorldCom is also being investigated by the SEC for fraudulent bookkeeping activities. There is rumor that Qualcomm could also be under investigation. It would appear that the chickens have come home to roost.

The end of the world as we know it.I found your post most interesting. Your surmation of Mr. Rifkins writings indeed point in a direction that the world is in a state of transformation.An elite ruling class supported by legions in servatude. I hope that my following opinion does not come true, but my observations say otherwise.

Over the years there have been many discoveries and adaptations in the workplace. Truly changing the world. Automation combined with the assembly line has done both good and evil in our lifetime. The automation of the assembly line has increased production and inturned increased profits. Providing availability of a product at a lower price to the public. These two new inovations also created a new war. One of profits VS.workers/jobs.
Mr. Rifkins veiw of a split society could well be in the making. An automated assembly line that requires lower skill to operate enducing others to a non-exsistant job society.
At the very least a highly competative workforce accepting lower wages for a decreasing job enviorment.Taking into account the growing world population one can only imagine the job market in ten years.
Yet having an enlarged skilled/semi-skilled workforce would still be small to the overall population of the planet.
Is this the foundation of the elite class. Was NAFTA and GATT in essence to bring wages to an equalibrium? Were all these treaties for the benifit of mankind or PROFIT? Are we witnessing the grasp of the worlds finite resourses right before our eyes.Biosphere,Wildlife protected areas, No drilling for oil zones.
Gold being one of these resources would be high on their list. At this price it is being handed to us on a platter.
If they succede in reducing the workforce or lowering wages, who will be able to buy at this price?
They have planned it well and have both sides covered. Profit and Gold.
The Third Tier will be those who control the masses.
All the more reason to own gold in a uncertain world.
Slingshot---------------------------<>