Tom Calandra of CBS Marketwatch made a bet that if Gold stayed above $300.00/oz. for a minimum of 5 days in a row, he would dye his hair "Gold". Well, just a couple of more days to go.

So far no mention of the Gold rally on CNBC.Though Faber is wearin a Gold colored tie.

Don't die of shock when it happens; you're gonna find out soon enough.

The above subject line was the headline on page 7A in today's St. Paul Pioneer Press, St. Paul, MN.
This is the American tax dollar at work. Remember that Israel gets $3billion in U.S. taxpayer dollars every year with no strings attached.

I sent him an e-mail mentioning that I would be looking forward to seeing him dye his hair gold, and he responded "that was back in November" he didn't really seem to be too enthusiastic to do it right now.

All I can say is that I'm a man of my word, and if I made a promise like that with no apparent 'additional' boundaries, I'd be more than happy to honour it.

Good to see spot movin'!! cheers all!!

Le Sin : Yep, the dollar dilemma and the war fronts !Excellent Chineze timing for reactivating the Taiwan burner.

YGM : Scalar wars!? Fascinating !

Gresham :Sharon's dictatorial ultimatum on Arafat will solve nothing and make things worse !

Thanks for the info.

Borrow from Peter to pay Paul......Desperation ????U.s. Moves To Avoid Default

Tuesday April 2, 2002 3:40 PM


WASHINGTON (AP) - The Bush administration will take steps this week to prevent a federal default, given Congress' failure to raise the government's borrowing limit.

Treasury Secretary Paul O'Neill, in a letter to congressional leaders Tuesday, said the government would avoid a default by temporarily shifting money in a retirement fund for civil servants into a non-interest-bearing account.

That would take tens of billions of dollars out of the calculation of the federal debt, freeing room for more borrowing. The shift will begin Thursday and end about April 18.

Eventually, the money - along with all lost interest - would be put back into interest-bearing instruments.

The affected account, the Government Securities Investment Fund, ``will receive complete restoration of all funds temporarily affected by this necessary action, including full and automatic restoration of any interest that would have been credited to the fund,'' O'Neill said in the letter. ``Beneficiaries will be the same as if this temporary action had never taken place,''

The action will be taken Thursday because it will be about that time that the government expects federal debt would otherwise reach the $5.95 trillion ceiling. O'Neill has repeatedly asked Congress to boost the ceiling by $750 billion. But with Democrats and many conservative Republicans on Capitol Hill opposed, efforts to raise the debt ceiling have foundered.

The shift of some retirement accounts was used in 1995 by President Clinton's treasury secretary, Robert Rubin, to avoid default during a budget fight with the Republican-controlled Congress.

Since the government began raising money to fight World War I in 1917, Congress has let the Treasury borrow the money it wants, as long as it stays within limits.

O'Neill, in the letter to congressional leaders, raised hopes that a deal boosting the debt ceiling would eventually be done.

``Together we must continue working to enact an increase in the statutory debt limit as quickly as possible to avoid any negative repercussions at home or abroad,'' O'Neill said.

http://www.themedialine.org/news/news_detail.asp?NewsID=215He's a one man equivalent of the Fed. Res., printing his way to prosperity! Wonder what his Swiss account holds!
Morroccan currency is probably cheaper to buy than print tho.......Got Gold?

This silver mining (hecla mining: hl)company is up dramatically in the last two trading sessions. I can't find a site to log its competitors on one graph together to measure what may be happening industry wide. Anyone else looking at this? Please confirm if a trend is occuring. Hope this is showing the way for the metal.......the word squeeze comes to mind....

http://finance.yahoo.com/q?d=c&c=HL&k=c1&t=1y&s=nem&a=v&p=s&l=on&z=m&q=lSee URL above.

We have helped thousands of investors with their bullion and pre-1933 gold coin purchases. We can help you. That's what we do. It's been our business for nearly thirty years now. Give us a call... gold ownership made easy on three continents! Don't be shy -- we educate first time investors.

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

Regarding Hecla - they mine gold too.

On Friday they announced they hit gold at depth at their La Camorra mine in Venezuela. Yesterday they announced the acquisition of a major lease for gold property also in Venezuela.

My broker has a volume alert on it right now, big blocks are being bought.

There was some speculation on another board yesterday that they may be a take over candidate - though I hope not.

Due your own due dilligence and not investment advice, I own a litte bit of this one.

Pizz

http://finance.yahoo.com/q?s=NEM&d=c&k=c1&c=HL&a=v&p=s&t=my&l=on&z=m&q=lWe generally try hard to avoid the slippery slope that will rapidly turn this particularly unique gold discussion forum into little other than a stock chat room, which are already a dime a dozen elsewhere on the internet. Many here very glad to have among the vastness of the internet at least this one site free from the blitz of promotions for Wall Street's paper in one form or another -- wheter it be debt securities (bonds) of the government, banks, manufacturing, mining, or retail corporations, or else the asset securities (stocks) of banks, manufacturing, mining, or retail corporations.

But briefly, since the two of you would have us all turn our attention to the fortunes of the Hecla and Newmont corporations, every picture tells its own story, and you'd be sure to want to cosider this one (see link above) in addition to the one offered by Pippin. How much real and steadfast comfort has been offered by the paper asset class representing these corporations by holders since long ago 1988? Since 1996?

In the meanwhile, to holders anywhere in the world under a wide assortment of currency regimes, gold metal offered all of the real security unique to gold metal, a bulwark against privation that gains in power even as confidence in all others is lost.

Again, there is ample material to discuss regarding gold's part in an evolving world in which economics plays an ever increasingly important role. I don't think that we need waste time or space here in giving one particular corporation or another a leg up with free publicity or attention. There are other avenues specifically provided to acheive those ends, and anyone with vested interests toward those ends are encouraged to seek them out for such purposes. Our attention here should remain on discussion of the unique merits of gold metal ownership as part of a diversified portfolio to stand against the shifting political and economic realities of each new day. Discussion of those shifting socio-political/economic realities being also fair game for discussion as they relate to a person's contemplation for gold ownership.

Randy

http://www.cbbc.org/ezine/archive/sector-reports/sector-report1.html
Red Gold
Slowly, the shroud of secrecy surrounding China's gold production and reserves is lifting and plans are afoot to deregulate the sector. But, as John Adams explains, there are still many steps to be taken before a free market in gold will happen

For many years the amount of gold produced annually in mainland China, its geographical source and the level held in the official reserves were mysterious state secrets, whose possession was dangerous to the holder. Much effort was devoted by Western analysts to determining exactly how much gold China had at any one point, and how much had been sold on the world markets to cover bad harvests or political upsets. China was known to be mining gold in modest but useful amounts of perhaps 50 tonnes a year, but beyond that little was known.

The food shortages which followed the disastrous Great Leap Forward in 1958 forced China to sell gold to buy grain abroad, depleting the national reserves. During the autumn of 1966, as the equally disastrous Cultural Revolution got underway, Red Guard searches in Shanghai alone are reported to have turned up some 35 tonnes of privately held gold, presumably in bullion or coin, and 450 tonnes of gold and silver jewellery. This is not surprising: China is estimated to have some 5,000 tonnes of gold in private hands, worth billions of dollars.

Despite the disruption created by the Cultural Revolution, the banking system continued to function, at least abroad, and China is reported cannily to have sold its sterling balances in 1967, prior to the devaluation of sterling, and to have bought gold at US$35 per ounce, benefiting from subsequent gold price rises also.

In 1976, at the end of the Cultural Revolution, some 81 tonnes of gold were reported to have been sold after the Tangshan earthquake and Chairman Mao's death. Similarly, there were gold swaps after the events of Tiananmen in 1989, when China's credit rating was low.

As China moves forward into the 2000s it is faced with some tough decisions as a new world trade order (another international structure not of China's designing) emerges. No longer politically isolated, and groaning under the multiple cash demands from state industries on declining state revenues, China is examining all expenditure with a cold eye.

Gold, which once served as a silent and efficient cordial to oil the wheels of trade, is no longer seen as central to its needs. Since the 1990s foreign exchange earnings from exports have soared to about US$154bn, and while the amount of gold held at reportedly 12.7m ounces has not diminished, the proportion has fallen back from perhaps 50-60 per cent to only 3 per cent of total reserves.

To get things into perspective
China currently produces some 170 or so tonnes a year of gold from a large number of small deposits in almost every province in China. This is nonetheless only as much as one large multinational such as Anglogold. Most gold originates from mines in Shandong province (about 25 per cent) though there are also useful amounts of alluvial gold in China's many rivers. The far west of China is still being explored, and the major foreign gold mining companies are convinced that there is a major strike still to be made.

The gold mines are coming under budgetary and lending constraints. Official subsidies for prospecting are being cut back, smaller mines closed down and polluting processes restricted. So long as the world price for gold remains around US$280-330 per ounce, Chinese production is likely to stagnate or falter in the medium term. Listing of mines in China or abroad, or take-overs, are possible solutions.

The mines, where they have been modernised, have used the most modern equipment available. Nonetheless, productivity levels per person remain unsatisfactory, and the general level of production even at the bigger mines may only be 5 tonnes or so. The many small-scale mines are being closed down or else starved of funds.

Foreign direct investment in gold mining has so far been disappointing. Even the gold "seniors" (the major gold companies) have found the approval process daunting (with over 40 separate steps), while the legal framework (such as on ownership and transfer of property rights) is unclear; the taxation regime does not allow for the special nature of mining investment. Dry wells may cost up to US$25m in prospecting and exploration costs which cannot be offset.

A dozen or so gold "juniors" have signed up to develop properties in China, but are constrained by the current low world gold price, and lack of bank and investor interest in funding. China has yet to attract the billion-dollar gold mines currently up and running in Indonesia.

On the structural side big changes are afoot in China. At the moment, all gold mined in China has to be sold to the People's Bank of China, which in turn onsells it to the wholesalers, manufacturers and retailers. In the recent past, the price paid by the People's Bank to the mines was well below the prevailing world price, giving a strong inducement to smuggling gold out of China. This was rectified by the authorities, and the price adjusted upwards. There it remained, while the world price plummeted, thus giving a strong incentive to smuggle gold back into China and sell it to the authorities as domestic production.

The only thing which made this system viable was the ruinous mark-up added to the price paid by the consumers of gold. The People's Bank now has the power to change the gold price without reference to the State Council, and it closely shadows the daily international price.

Towards a new system
In the first week of November 1999 the World Gold Council, in conjunction with China's National Economic Research Institute of the China Reform Foundation, the Development Research Centre of the State Council and the Financial Research Bureau of the People's Bank of China organised a forum in Beijing attended by over 120 delegates from the central bank, gold mining companies, the gold jewellery trade and various financial institutes.

The conference discussed a series of papers on the changing role of gold, but also concentrated on the reform of the Chinese gold market. In particular, the World Gold Council, the forum for gold producers worldwide, presented its paper entrusted to the National Economic Research Institute of the China Reform Foundation, on deregulating the gold market in China. The paper pointed to the special characteristics of the gold market in China, the lack of any precedent in any other market, and the difficulties inherent in the reform. The report suggests a several-staged reform of the gold market, among them:

Establishment of a gold market to replace the monopoly of the People's Bank over purchase and allocation via a gold exchange limited in membership to large producers, purchasers and brokers

Business to be limited to spot only transactions

People's Bank to begin decontrol of gold purchases with a dual-track system: this would allocate a purchase ratio to producers, who would, however, be free to decide whether to sell to the People's Bank or to the market. Any production surplus over quota to be sold on the market

Complete opening of the gold market with individuals able to buy and sell gold products for the purpose of savings and investment

Quota-based allocations to manufacturers to be abolished

Brokers to provide gold sales to small and medium-sized manufacturers

People's Bank purchases cease; all gold production sold directly on local market

Individuals free to purchase gold

Mechanisms for futures to be set in hand

Removal of the ban on gold exports and imports; direct linkage to the world gold markets. The report emphasises that this will also be conditional on complete convertibility of the renminbi

The establishment of a stabilisation fund in the interim period before China's domestic gold price is completely aligned with the international level, in order to smooth price fluctuation. The fund to be entrusted by the People's Bank to some local agency. These operations to cease on full linkage to the world market

The report also underlines the view that gold will continue to play an important part in China's national reserves as a stabilising factor in financial crises

These reforms will be difficult to implement, and carry a number of thorny problems concerning the convertibility of the renminbi, and the VAT status of gold when sold to private customers. Silver, for example, was deregulated at the start of 2000. It, too, was a metal held in the official reserves to the tune of perhaps 2,500-3,000 tonnes, but VAT is now chargeable at an assumed rate of 17 per cent, which has cast a shadow over the new market.

Gold fingers
In the meantime, gold sales to the private sector in China continue to boom. The major off-take is now in gold jewellery, which may consume 200 tonnes a year (more than total domestic mine production). The World Gold Council has identified Chinese demand for gold jewellery as one of the forces to drive world gold production in general, and has instituted marketing programmes in conjunction with local jewellers and media.

In 1998 the WGC worked with Shanghai Lao Miao Gold Company to set up a publicity campaign using a local television series "Love in Shanghai" to launch the Amour range of jewellery. Lao Miao's sales rose some 15 per cent after this campaign.

This was followed in late 1999 by a larger scale media campaign, again organised by WGC and Shanghai Lao Miao Gold, but this time launched in 18 major Chinese cities, and linked into Lao Miao's range of 24K jewellery collection, Forever, with items from the collection again worn in a 20-episode television programme.

The major target of this campaign was young women office workers, with salaries in the region of Yn2,500 per month (US$300). In 1999 Lao Miao was able to register a rise in sales of some 30 per cent. Not surprisingly, it has identified the major sales period as being the Chinese New Year (which varies according to the lunar calendar) and, less traditionally, St Valentine's day.

The main market in China is for gold of between 95.9 per cent content (959 fineness, 23 Carat) and 100 per cent (999, 24). While many items of jewellery are universal in appeal, some items are culturally specific to China: the astrological year signs of animals such as pigs and snakes, or the berobed Gods of Health, Wealth and Happiness, may have limited appeal elsewhere, though will be of interest to the large numbers of overseas Chinese.

But the big wide world moves on. The Bank of England has been directed by a reforming Chancellor to treat Britain's gold reserves as though gold was no different from frozen concentrated orange juice futures, or pork bellies in Chicago. In Beijing, resource nationalism may reign for a few years more, but Guangdong now buys its coal in Australia, and China is becoming heavily dependant on oil imports from abroad: "commoditisation", for gold as well as other products, is the new game.

I stand corrected - sorry.
I really did not intend to draw the attention of anybody to a certain security - I just answered a question of somebody who needed a comparison tool. But I understand the point.

http://www.atimes.com/global-econ/DD03Dj01.htmlInteresting article -calling the push for globalization for what it is. A globalization of financial markets to the detriment of the real produc(tive- or)ing countries.

A rude awakening to these facts may be in the cards. Sooner as some think. cb2

In his at the bell closing comments he mentioned "the concept of gold as a safe haven is making a comeback".
Maria mentioned both oil and gold as the "news of the day".
Joe Kernan mentioned the higher prices of commodities as a group as one reason why the equities were down today. Apparently he sees an inverse relationship between the two and his preference would be higher stock prices. I would agree that the CRB will go higher at the expense of money inflow in stocks in our present situation. Is/has there always been such an inverse relation? Are paper and tangible assets always at odds?
The peoples stock market television channel has been mentioning gold, silver and oil all day. Of course, stocks related to both oil and metals were also mentioned with the usual charts, graphs, whistles, bells and opinions. We are getting exposure. If Joe and Jill bubblevision viewers are going to jump in, we may see it soon. Momentum and trend following buying may also be approaching.
I believe the Japanese deposit insurance coverage reduction April 1st deadline pertains only to long term or certificate of deposit type investments. Next year it will be lowered on common bank deposits. I hope gold buying continues in Japan but I know how quickly I attend to tasks that can be put off for a year.
On the technical side, I'm watching open interest which in silver has increased from approx. 66,000 contracts to over 77,000 contracts during this latest run up which started around the $4.30 level and must exceed $4.77 to assure a higher high. Maybe tomorrow!
Gold and oil, oil and gold all the day long. Now, isn't CNBC a wonderful thing? As to why, they haven't a clue but further investment money into gold/silver will gladly and unquestioningly accept their Middle-East tensions and "flight to safe haven" as reason enough to buy.
Mikal, if silver breaks above the old 477 high, am I then allow to yell!?
Rich

I was amused/surpirsed/dissapointed today as I watched a number of mining companies stocks trade lower even as the POG was advancing. I don't understand why individuals would be selling lower in what appears to be a bull market. Is it merely a 'follow the lemming' market, or am I missing something here?

I know, I know, physical, physical, blah blah blah. I already own physical, I just want to understand how the market is functioning, because I believe there are also gains to be made in the securities markets. Don't pretend you don't know what I'm talking about, I know there are a few of you out there who also trade stocks.

Does anyone know what would motivate an individual to sell stocks on a "commodity" while the prices are moving higher? Add to that, that these stocks were trading for more when the POG was significantly lower. Please, assist a rookie would ya? Are we losing PM momentum? Are people already becoming bored with AU now that it's crossed the 300 mark and seemingly sitting strong? I don't understand.

http://www.ananova.com/yournews/story/sm_531444.html
Why not,the BOJ seems to love it,the common folk are just getting in on the action.

Is there something wrong with that?

Pretty hard to moralize,given the destruction of the Japanese economy thanks to official debasement of the currency.

http://money.cnn.com/2002/04/02/markets/bondcenter/treasury_debt.reut/index.htmHEADLINE: Treasury acts to avoid debt limit -- Department will tap government retirement fund as U.S. nears $5.95 trillion debt cap.

WASHINGTON (CNN/Money) Apr. 2 - ...As of Monday, U.S. government debt subject to a Congressionally set limit stood at $5.928 trillion, about $22 billion below the ceiling.
The Treasury said it will suspend investment in Treasury securities of the so-called G-Fund, one of five different funds that government employees have available in their federal savings plan, to avoid hitting the limit.
+
By suspending investment in the G-Fund, the Treasury will create about $40 billion in headroom for its usual debt securities. In order to tide it over until the mid-April tax flows. Treasury also said Tuesday it will sell about $46 billion in bills that will mature in mid-April to enable it to pay monthly benefits and payroll costs. Treasury usually has to sell debt in the early part of April, by far the biggest month for receipts, to make ends meet.
---(click link for full article)----

Worldwide, holders of U.S. debt securities watch this performance and they think carefully about the future and alternatives...

R.

Good question.
Without naming any specific companies, I believe we can say the mining company indexes like the XAU, the HUI and the TSE index are market indicators and may be mentioned in that context.
These indexes were up this morning but ended the day down. However, one day is much too short a time (unless you are a daytrader). Look at them in a much longer time frame. The XAU upmove preceeded POG by a good long time, measured in months not days. It's been advancing for over a year now and probably will continue (I hope) for many years to come accompanied by both POG and POS. Up, down, down, up but over any reasonable length of time- up!
These indexes started long before both gold or silver.
Will a definite end of this index trend announce the imminent ending of the metals' price bull? Blasphamy, you say? Hey, I'm looking ahead five or ten years. There will be a peak somewhere in both POG and POS. Anywhere north of $100/ounce for silver will suit me just fine.
Rich

http://money.iwon.com/jsp/nw/nwdt_ge.jsp?section=news≠ws_id=reu-n02204955&feed=reu&date=20020402&cat=USMARKETHEADLINE: Ford confirms PGM sales, palladium mkt steady

NEW YORK, April 2 (Reuters) - Ford Motor Co. is gradually selling palladium it no longer needs to reduce pollution from its automobiles, confirming in its latest government filing [its annual 10-K report] market suspicions that it had been reducing the precious metals inventory that cost it $1 billion when prices fell last year.

..."For our precious metals physically held, we have accordingly revised our stocking requirements and are in the process of reducing metals that are in excess of those stocking requirements (including market sales to the extent the market can absorb the metal in an orderly fashion)," Ford said in the the document.

Because of the catalyst design breakthrough, it projected that its palladium usage in 2002 will be down more than 50% from 2000.

But supplies of the metal have been very erratic in recent years ... prodded automakers and other industrial users to research cheaper and more readily available substitutes and to develop alternative technologies to meet increasingly stringent emission control laws...

To guarantee supply, Ford bought the metals aggressively in 2000 and early 2001 when palladium prices were on their way to record highs near $1,100 an ounce early last year.
But palladium prices collapsed to near $300 an ounce in late 2001 because of the global recession and frequent selling from Russia.

...Ford's annual report said it planned several actions for outstanding precious metal forward purchase contracts, including cash settling instead of taking physical delivery of the commodities.

-----(click link for full report)----

Similarities may be seen to exist through time and space, but modern circumstances are working to reveal that not all precious metals are alike for purposes of portfolio diversification and wealth preservation. Viva la difference! Call Centennial to discuss a diversification/investment strategy that is right for you.

R.

Gold prices are higher yet the mining shares are lower. How can this happen some ask. It is quite simple as the Gold shares overshot on the upside. Now the underlying asset must work to catch up (notice that Gold is still higher). As a result speculative market players are locking in profits and others are taking some profits to lower their "cost basis" on remaining shares (I have done this myself in the past). Interesting is that the physical metal appears to be in "accumulation". I suspect that there are greater (much greater) gains in Gold yet to come.

Another reason that Gold mining shares stalled out is that many fled to Gold shares for a "flight to quality" in the face of ME tensions (actually most did so for the speculative edge). This is not a concern to those who buy physical Gold for portfolio insurance purposes. However, some are debating how long these ME tensions will last or if they will escalate. It appears that the Israeli invasion is spreading and Palestinian attacks are continuing. If the war heats up some more we will likely see both physical and mining shares resume higher.

Also, today news has revealed that Stillwater Mining (SWC), the PGM producer in Montana is under SEC investigation for how they valued reserves. I bailed out of that dog long ago as they had a knack for selling forward at the lowest possible prices. Management is utterly incompetent.

On the PGM front, Russia still is not delivering into their metal contracts. This was not unexpected of course as Russian stockpiles have been essentially depleted since 1998. Any PGM supply must come from current production. As most PGM supply is from by-product nickel production form Norilsk Nickel, I would not hold my breath waiting for delivery. Base metal production is down due to lower base metal prices (although recovering of late) and therefore PGM production will be slow. Russian exporters have stated that they are waiting for Palladium prices in the $400 to $600 range. Another wildcard is that Ford Motor Co. is selling off some excess Palladium that they acquired at much higher prices (somebody had to have lost their job over that one).

Meanwhile Oil and Natural Gas prices are much higher. Most of this is due to ME tensions, yet there is also a growing consensus that there will be petroleum supply shortages come this fall and winter. I covered much of this earlier. There are growing concerns on Wall Street that the "economic recovery" was an illusion dreamed up by analysts based on murky data and overly optimistic projections based on dubious data. The chickens are coming home to roost.

More and more funds are buying gold equities, still not enough to push a feather though. So when these 20 somethingfund managers [Who don't know Jack about this market] get a tiny gain they sell to "lock in their profits".

Never mind that the trade will run away from them as it has, lo these many months for about 15 months now. They imagine they can ride the crests by buying the dips. Trouble is, there aren't so many real dips any more.

Hui usually bounces back the next day and even overshoots the trend sometimes.

I've been thinking that the golds may detach from pog the way internets detached [Upward] from their non-existent earnings in late 1999 and 2000. Thus the normal 3X leverage of equities to pog may swell to 6X or 10X.

The problem with all this speculation is that we are in uncharted territory for gold...uncharted due to the skewed, deformed market fundamentals caused by US Government manipulation through the sales of our treasury's gold bullion.

Looking at historical [Back to the 60's] M3 Growth rates, Don Lindley has revealed an enormous spike of late in this metric. Only bad things are ahead for the cabal and everyone else who doesn't have gold.

On a personal note, this weekend I tried to persuade my sister to sell her Vivendi stock [Her husband is a Muckety-Muck for them]. She couldn't hang up the phone fast enough. "It will come back", she said.

This process...the belief mechanism that shuts out all reality is well examined by the the following quote:

"Of the ten leading vacuum tube manufacturers, none participated in the transistor revolution"...Chet Raymo [The "R" in TRW]. The same mechanism at work there is at work now in the gold paradigm shift. Most fundfs still shun gold...meaning they remain potential buyers.

The ME is a powder keg...Arabs are heavily buying gold in a militaristic sense...they may have guessed that doing so will hurt the US.

Think of your gold investment as the purchase of well-situated land.

Yes, I saw it and it does seem strange.

"Manipulation" - it can work both on physical as well as on futures and stocks, too.

The stock market can be kept up - for a time - via manipulation. I guess certain stocks which are not supposed to go up, can be manipulated so they don't.

Not many people are attracted to physical gold; but a great many are into stocks; it is rather embarrasing, for the financial establishment, to have gold stocks go up. Too many commentators would have to notice. And that won't do.

We'll have to wait and watch. Much more of this, and we'll know the PPT is slamming gold stocks. If I am wrong, please let me know. Would shorting do the job, or not?

Sierra

http://www.goldwaschen.ch/egold_occ.htmJust for the fun of it: you may have heard the sentence that <>.

What you may not know is this is also true for gold, as demonstrated by the URL above, which displays a map showing that gold exists in Switzerland also (apart in the banks' vaults of course), although in homeopathic quantities.

Can you imagine that a total of ...73 gold coins ("Goldvreneli") were minted from the mine of Gondo in Valais ? This may explain the Swiss National Bank's sales.

So if POG moves to $ 10K per once, who knows ...we'll maybe see gold prospectors even in Geneva :-)

Nothing ventured, nothing gainedRe: Your "yell" signal- 1) After some false signals a few weeks back, maybe our "irrational exuberance" should take this form: "I am indeed rich since my income is superior to my expenses, and my expense is equal to my wishes."-Edward Gibbon, Memoirs 2) Variety is the spice of life, so celebrate a little, diversify into AU (metal), and flame me once in a while! 3) Major resistance levels, recently posted here and there conclude >$4.48>>$4.75($4.80)>>$5.70>galactic enumeration. To consider: Can David Morgans $6.50 year 2002 top, satisfy you? Have you ruled out more selling from the Phillipine hoards? Mexican silver output, just announced, is up 25%, can Peru, Argentina, etc. be far behind, and is this just the prologue? Will you diversify into physical gold- the choice of Kings? :)) Thanks, your a breath of fresh air.

I thought the article you posted was so important I wanted to post it in it's entirety to make sure as many people saw it as possible.

Creative accounting and the destructive risk
By Henry C K Liu

Alan Greenspan, chairman of the US Federal Reserve Board, frequently credits US growth in the 1990s to a rise in productivity made possible by advances in technology. Yet studies have shown that computerization did not simulate much rise in industrial productivity in the 1990s. Industrial computerization was essentially in place long before 1995. The 1990s boom in the US was not an industrial boom but a financial boom. This was made possible by three developments: the deregulation of financial markets, the computerization of trading of financial instruments, and globalization, particularly financial globalization.

The entire structured finance (derivatives) phenomenon would not be possible without any one of the above mentioned developments. Structured finance in essence allowed an unprecedented explosion of credit, by unbundling risks for a wide range of risk-takers who sought corresponding compensatory returns. While hedging initially provided protection against volatility to individual market participants, it soon became a profit center for financial institutions. This led to the institutionalization of volatility as a market opportunity. Financial institutions actually sought volatility in the system to provide a continuous profit stream.

Creative accounting, whose peculiar logic evolved from structured finance, also made the traditional debt/equity ratio immaterial. Ways were devised for the large market participants to structure debt as hedges, through swaps that avoided taxes and balance-sheet liabilities. Swaps enabled borrowers legally to book loan proceeds as current operating income and loan liabilities as future capital expenditure that could be kept off the balance sheet, inflating current earnings. Circular counterparty risks suddenly became neutralized risk, and cash flow from swaps became net revenue. These practices are now known as Enronitis.

On the macro level, the global finance game has become a sure win for those who use dollars, especially those whose government issues dollars by fiat. The world market has become a place where the United States makes dollars and the rest of the world makes what dollars can buy. But after the Asian financial crisis of 1997, the whole world essentially adopted dollarization, if not directly, at least through hedges, albeit sometimes at prohibitive cost.

At that point, the US economy suddenly began to lose its exclusive dollar hegemony advantage because US entities were no longer the only ones with access to dollars nor could US transnationals avoid non-dollar revenue. To maintain the "strong dollar" monetary policy instituted by US treasury secretary Robert Rubin at the beginning of the Bill Clinton presidency, the US Federal Reserve progressively tightened dollar money supply throughout most of the 1990s. But this did not slow the US economy because structured finance permitted debt to expand without a corresponding expansion of equity. A strong dollar gave the US economy a boom in low-cost imports, while the US trade deficit merely forced foreign exporters to hold dollar reserves to finance the US debt bubble through a US capital account surplus. Japan did this for a whole decade, pushing its own economy into permanent recession while its dollar reserves mounted. Mainland China, Hong Kong and Taiwan took up the slack from Japan by 1995 and the three Chinese economies together now hold more dollar reserves than Japan does. China, starved for capital for domestic development, thus finds itself stuck with US$200 billion in US Treasury bills that pay 5 percent while it is forced to offer foreign direct investment high double-digit returns. The annual interest gap alone is in excess of $20 billion, which amounts to half of China's current annual foreign-capital inflow.

Growth in the 1990s came from a structural shift of the US economy from industrial capitalism to finance capitalism. Through financial globalization, the US shifted labor intensive manufacturing off US soil to low-wage locations, thus lowering the cost of manufactured products. Financial products and services and intellectual property valuation constituted most of the growth, making the US a consumer market of last resort for the whole world. London, Frankfurt, Paris, Tokyo, Hong Kong and Singapore became financial outposts of New York, sucking up dollar reserves to support the US debt bubble.

This game is ending, as the US consumer market becomes saturated and condemned to low single-digit growth, regardless of business cycles. The wealth effect from a tripling of equity value did not double consumption in the US, because aggregate demand is constrained by a widening income disparity. The rich have bought all the manufactured products they need and the working poor cannot afford to buy all they want. The wealth effect did double investment globally, reflected in the phenomenal rise in market capitalization of US transnationals and financial institutions, particularly in the so-called New Economy. The competition for credit favored double-digit growth markets in the developing countries, but the US continued to dominate global finance through its sophistication and innovation in finance and through dollar hegemony.

The problem is that all unregulated markets eventually self-destruct. Weak competitors are naturally forced off the market, leading to monopolies that are the result of market failure of competition. Yet regulation cannot cure the problem preemptively because remedial regulation only makes sense after disasters, never before.

There is increasing evidence that the real threat to China is not democracy or the market economy per se but the peculiar US version of these institutions. The 19th-century industrial capitalism that Marx observed no longer exists. Finance capitalism is a system in which capital is only a notional value upon which to build a gigantic mountain of hidden debt. Representative democracy and unregulated market fundamentalism in the US mode now work as legalized constitutional devices to disfranchise the poor and weak, both locally and globally.

Greenspan acknowledged this in his semiannual monetary policy report to the US Congress, before the Committee on Financial Services on February 27: "From one perspective, the ever-increasing proportion of our GDP [gross domestic product] that represents conceptual as distinct from physical value-added may actually have lessened cyclical volatility. In particular, the fact that concepts cannot be held as inventories means a greater share of GDP is not subject to a type of dynamics that amplifies cyclical swings. But an economy in which concepts form an important share of valuation has its own vulnerabilities." He was of course referring to Enronitis.

Greenspan's observation about the vulnerabilities of conceptual valuation was on target, although his warning of vulnerability was disproportionately misplaced. Even after the Enron and Global Crossing controversies, Greenspan continues to resist regulation, preferring to rely on market discipline. The risk is much higher than he admits.

Past records do not reliably project future vulnerability risk. Any risk manager knows that accidents are always waiting to happen. The fact that it has not happened in the past does not mean it will not happen in the future. In fact, with each passing day without an accident, the risk of borrowed time increases. Low probability is only a source of comfort if the impact is not fatal.

Also, what Greenspan did not say, but admitted by implication, was that finance capitalism is operating with less and less reliance on capital. Capital has become a notional value in structured finance. Credit is no longer anchored by equity but by circular hedges. Debt-to-equity ratio is no longer a relevant consideration. Practically all US major businesses nowadays, with their high debt leverage, would have negative real equity if the price/earning (P/E) ratio were to return to historical norms. Blue chips are being shut out of the unsecured short-term commercial paper market. Corporate credit ratings are inflated by exorbitant market capitalization value, which in turn reflects irrational P/E ratios. Even now, during what many on Wall Street contend to be a savage bear market, the Standard & Poor's 500 Index yields 25 times earnings. It would have to fall by another 41 percent to reach the median valuation prevailing since 1957.

Such a decline can happen in a period of days in this age of program trading and socialized risk, even with circuit breakers and trading curbs. When that happens, structured finance will be a sea of dead and wounded in counterparty casualties, regardless of who won and who lost.

Henry C K Liu is chairman of the New York-based Liu Investment Group.

Or, more likely, the research department behind the scenes. Bob now has a list of seven reasons why the POG is on the move.
1. Tensions, in the Middle-east (war) and tensions over bank deposit insurance in Japan
2. Safe haven buying in unsure times
3. Fewer bank auctions (but no mention was made of the Washington Agreement or its expiration date)
4. Momentum (a politically correct term for mania or blind, unthoughtout buying) investing. This should not be confused with rational exuberant gold accumulation sometimes known as "buying with both hands"
5. Short covering
6. Inflation fears (!!) Added emphasis is mine.
7. Alternative to the dollar. Bob had trouble reading this last reason and quickly added that some people actually question the eternal strength of the American dollar. He used the adjective "apocalyptic" in describing the thought process of these crazy people. Can you imagine? What next? Will someone suggest a slowdown in personal debt growth or (shutter) savings!
Rich

Re. your post #72512Your observation of the new postage stamp and it'e new world order link reminded me of somthing you might enjoy. When the Germany fell the US army spirited off with most all of the goverment files law books etc. Some years later after the translaters got the english done many of the US congressmen and senators found them good reading. Then about mid 1960's one senator layed in wait for an event to put his new knowledge to good use. President Kennedy gets killed in Texas by Oswald (yeah right)using a rifle delivered to him via US mail. Perfect.
Now our senator has his chance and viola the 1968 gun control act. Not only a law that is in scope and style of Hitlers 1938 gun control act but in many many places word for word. Oh well...live small.
RJ

I went thru a dozen or so companies checking the days events. A couple of the majors drifted slowly down thru the day but most interesting quite a few did the big slide (ie: Agnico) at 2:00pm.

So we have a couple theories floating about that the shares got ahead of themselves, day traders now involved in the volatility etc.

One thing not mentioned, that does bother me, is the possibility of a negative factor after the Comex (1:30?) close. This would explain the sudden slide in the case of Agnico.

I hope I am wrong in a gut feeling that POG is heading down, a take that the market recognized late in the afternoon.

My concern for owning stocks in lieu of metal is simply that the gold market is so thoroughly screwed up with shorts and specs and paper dreams to hedge dollar denominated wealth etc. ad infinitum, is that this very abnormal market will implode and then who can forecast the outcome? BTW, I own shares and metal.

Why would POG go down under these current circumstances? I am talking about the metal not share prices.

Thought you might be about! Good quote from Gibbon. Getting rich satisfies the need for a goal and being free from bill paying worries is a novel idea but making the journey may be more fun that reaching the destination. Here's another thought, "Please Lord, let the POG go to $10,000/ounce so I can prove that I can remain humble while being filthy rich."
I remember seeing that Mexican silver production was temporarily way down so that the 25% increase is just restoring its previous levels. I've forgotten why it was down, energy? The GFMS estimates of the silver deficit for year 2001 are between 80-90 million ounces. This is down from previous years but still a 7-8 million per month drawdown. Higher prices will increase production but it may take some doing. Doing often takes time, increasing production will too.
I'll be more than happy to see $6.50/ounce silver by year's end! And yes, when funds allow, I'll be a buyer of physical gold. I see merit in the physical-in-hand opinion but, when I look in my wallet, only silver is affordable so silver it is. I'd rather 100 silver coins than 2 gold ones. With paper option investments, I hold both and see about the same potential % return with an equal % increase in price. Some risk required!
Philipine silver stash? I wish I knew for sure. Ted Butler does too. Are you watching open interest? This rally may have some perseverence. Hope so!
Rich

Bob Pisani's Magnificent List of SevenLet the music begin!

Is that all the reasons they could come up with for the POG to move higher? May the Saints preserve us. How many are on this team? Wonder how long Bob's list would be if he ever logged on to this forum? Double for sure and even triple. Who will be first to buy Gold? His research team or Bob?

Bob must have seen a glimpse of the BIG PICTURE.
Just goes to prove.
If all they can do is come up with seven, we are way ahead of the pack.

Thanks USAGOLD and all at the Forum


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

Thank you for ideas supporting why some equities may have travelled lower today.

Sector,.. you mentioned that the 'arabs are heavily buying gold in a militaristic sense'... Are they buying significant quantities?

I think this could really hurt North America if they decide they want gold for oil as others have stated in this forum. First buy as much gold as you can, and then charge others gold for exchange of commodities, suddenly North America has no gold, or as we all knew, nothing reserved. Who were the monkeys that ever decided we didn't need a gold standard? Who are the monkeys who continue to believe gold is a commodity?

I'll look forward to seeing this mess pan out. As for my stocks, I've learned from experience to just leave 'em sit. I lost a lot of money last year by moving it around too much, not to mention all those lost dollars in paid comissions.

Cheers!!

With respect, I think you may be making too much of the weakness in gold stocks today. Gold traded up to the high achieved earlier this year and then stutter-stepped into the close. Gains in these equities have been so impressive. Who wouldn't blame those who "lightened up" here, just in case the resistance implied by this level holds?

But, in a day or two, I suspect most of that money (and more) which exited today will be getting right back into those same gold mining issues...and probably at higher levels. After all, where else are profits being made with such facility these days?

How are you mon ami!

I agree with you, there is no reason for gold to go down. Someone today mentioned that the fundamentals and technicals do not warrant a slide. I concur 100%. It in fact warrants a major gallop through and past 1999 resistance; there is much, much more wrong with fiat today than in Sept. 99.

I wonder though if some scam is underway in Japan, I wonder if some bullsnot conspiracy is underway in the M.E. I wonder if the accounting scandal is being swept 'under the carpet'. Given the supply/demand fundamentals gold SHOULD be much higher.

There are days when I wonder if FREE MARKETS will prevail.

Sorry, just thinking aloud.

Canuck.

P.S.: I feel slightly better that POG is presently above the NY close.

I am reading a book about the silver explosion in the winter 1979/spring 1980. Apparently the final straw was the 'demand for delivery', the physical squeeze beginning in October 1979. I remain thoroughly convinced that the 'bull' we speak of begins and ends with supply/demand fundamentals, the 'real' thing.

YGM's post at 4:16MT No. 72516 is absolutely ominous.
I don't discard the contents at all. Time to get religion!
Remember, the Mayan calendar ends with the "end of the 5th Sun" on Dec. 22, 2012. Coincidence? (The Mayan calendar counted 1,344,560 days. There is no Dec. 23, 2012.)

Gold is acting up. Is this thing about to explode? A panic is like nuclear fission. Once it gets going, it will not be stopped. We MAY see 10, 20, then 50 and 100 dollar rises per day. Game over!

Then we'll have a whole new set of problems to deal with.

I hope everyone is well stocked-up!

Sierra

And what, pray tell might the title of your book on the explosion of silver be?

http://groups.yahoo.com/group/gata/message/1070Reg Howe won even though his lawsuit was
dismissed. The suit just needs to be taken
over by some gold-mining companies.

http://groups.yahoo.com/group/gata/message/1070

http://groups.yahoo.com/group/gata/message/1071


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

I was unaware of your fascination with silver Sir!!!!!!

;)

Solomon beat me to the punch in asking for the name of the book. If rather obscure, please include the publisher which helps in locating a copy.
Solomon's probably thinking that some detailed history of the last price explosion may give insight into how best to profit from the coming one. Also, is it well written and fun reading?
Thanks
Rich

Where have you been, my friend? Solomon was thinking about silver before Warren Buffet got his first pair of long pants.
Rich

"I remain thoroughly convinced that the 'bull' we speak of begins and ends with supply/demand fundamentals, the 'real' thing."
Well spoken. The rest is market noise, some self-fulfilling technical trading or market manipulation. All these will yield over time to the invisible hand. Even the central government control of the soviet USSR couldn't overcome the influence of supply and demand.
It isn't nice to fool with Mother Nature.
Rich

...is leading pog's price. The gold volume is up 500%.

The shieks don't have to embargo their oil to make a point. All they have to do is purchase physical gold. The same goes for wise US investors.

Silver Bulls: The Great Silver Boom and Bust

Paul Sarnoff

page 31:

"..exchange officals were trying to find out from the longs what their intentions were with respect to their contracts...bullion dealers were becoming increasingly uneasy....if the longs had let go...willing to sell their contracts rather than holding out for metal."

page 23:

"...it became apparent that (longs) intended to accept delivery on their long futures contracts in the COMEX Sept. future."

page 21:

"....was worried about the pattern he saw developing in the silver market. Some of the silver longs, as their contracts approached maturity, were refusing to sell offsetting contracts, but instead were giving notice that they intended to take delivery....silver was becoming alarmingly scarce under the market's relentless demand..."

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

I'm only a quarter way through the book, much reference to the Hunt brothers so far. I am at the part where Comex began to severely increase the 'costs' for the longs, the author makes reference to the blatant 'impartiality'. I sense that the long physical holders could not 'hold out' until the very last gasp of blood-sucking air was expelled by the crooked 'paper-traders'. I hope to understand, in the end, how fortunes reversed so abruptly.

It is also very clear, so far, that initiating the 'corner' would be relatively easy, the amount of money would be insignificant ie: a la Bill Gates, a la Saudi Arabia. The trick, I believe, would be to maintain the 'corner' whilst dodging the death threats!

Awesome read so far!!

Pulling your leg amigo!

You and Mr. Weaver are tied for silver bull of the century.

;)

http://www.antiwar.com/hacohen/h-col.html
Letter From Israel by Ran HaCohen

The Auschwitz Logic�� April 1 , 2002

http://www.bloomberg.com/feature/feature1017759064.htmlSnippit:

Berkeley, California, April 2 (Bloomberg) -- We are living through one of those times when it is more fun than it should be to work at the Securities and Exchange Commission. An accounting scandal that began with Enron Corp.'s collapse and bankruptcy has touched all sorts of unlikely suspects. There isn't a company in America that cannot plausibly be investigated, and there isn't an investigation unworthy of public attention.


Black Blade: A matter of the fox guarding the hen house? Then again, incompetence would not be all that surprising.

CSFB Fires 300 Investment BankersCSFB fires 15% of investment banking workforce
By Lina Saigol in London and John Labate in New York
Published: April 2 2002 19:52 | Last Updated: April 3 2002 00:52

Credit Suisse First Boston on Tuesday fired 300 investment bankers, including 50 managing directors, in the latest effort by new chief executive John Mack to cut the company's high cost structure.

The job cuts, which represent around 15 per cent of CSFB's investment banking workforce, are some of the most aggressive on Wall Street this year. Investment banks have cut more than 25,000 jobs already as activity on Wall Street and in London's financial district slowed dramatically in profitable areas such as underwriting and mergers and acquisitions.

But for the first time the axe is falling on significant numbers of senior employees, many of whom at CSFB are on lucrative guaranteed contracts put in place by Alan Wheat, Mr Mack's predecessor.

Adebayo Ogunlesi, appointed head of investment banking at CSFB last month, told staff of the job cuts in a memo on Tuesday afternoon.

"I understand that change is not easy, but I have been enormously proud of the effort and contribution that all of you have made to ensure our Division's success . . . With these changes behind us, we now need to unleash the energy and extraordinary talents of the best group of professionals in the industry," Mr Ogunlesi wrote.

Mr Mack has pledged to cut $1bn in costs by the end of the year. Between September and October, the investment bank shed 2,500 positions, including 700 investment bankers, which were in addition to a round of cuts made soon after its merger the year before with Donaldson, Lufkin & Jenrette.

The merger with DLJ is part of the reason CSFB has such high compensation costs. CSFB's compensation is about 58 per cent of net revenue. That compares with rivals such as Goldman Sachs and Merrill Lynch, whose compensation accounts for roughly 50 per cent of revenue.

After the latest cuts, CSFB will have around 1,900 staff in investment banking, about the same number it had before the DLJ merger.
++++++++++++++++++++++++++++++++++++++
The mouth pieces from Treasury [Paul O'Neill] will think twice before making any more announcements of a "Recovery".

Black Blade some advice pleaseI am assuming that the entire Islam world is looking to wreck havoc on the U.S. Arabs supply money, Iraq & Iran weapons of destruction and the various terrorist groups, Hamas, Al Quaeda, etc. do the physical damage. I have heard you wax eloquently about the future price of oil. Since oil today hit a six month high, do you think this is an excellent opportunity for oil futures on the long side?

Hello fellow Gold bugs, Long time lurker with macro-economic theory for a hobby. This is the 400 level finance course I never found at the university in the "happy valley". Methinks the disparity of the POG vs. the shares is due to the high volumes sold at upper price levels in expectation of 320 gold. Early birds are taking profits and too many late pidgeons have landed on a hot wire. The fact that POG is hovering over 300 is actually a negative factor for the shares because it's the Anticipation of it crossing 300 that gets the lemmings a leapin. Now it's like "I actually got to talk to her", but maybe she won't want to go out with me. Hey baby lets go to 310 and see if there is any oil on sale under 35 a barrel? Nope she's skittish and it's good for the scottish because ya gots ta buy em a wee bit cheeper so ya can become again a sounder sleeper. In like six months which ones haven't doubled?? wELL How much more fireworks are left in the bag. Better check my Fibanichi Ratios to sprinkle on my ramen noodles. Are they ready for a 30% or a 50% or the 22% retracement FROM WHAT the past month's rally or from the whole six month move? Big question on the Big Boy's minds. "Well we aren't quite sure". So they shorted in and they're selling to knock them down so they can buy it back cheaper. Smart money chasing dumb money like cats and dogs. But since gold and defense are the only bull sectors the lemmings will be back for slaughter house five in the panic sell. All that has to happen is for POG to drop under 300 for a few days and you can reread Withering Heights. Personally I don't see the minor's patterns resembling the majors and HL proved the late bloomer could hit a home run too. And I'm crying over ROOY again II. I wouldn't touch a geld moan share at this time. I'd only sell, like tomorrow at the open or catch the big red candle down. I'm only saying this for the short term. In the long term I think we will see a bifurcation of the gold market, when futures contracts get stamped "payable in cash only" before TSHTF, IMNSHO. And little physical to go around. Faith is what Jimmy Carter said we needed when POG was over 750. I remember the speech. We had a faith crisis. How much faith crisis do we have is the upside blush on the precious metals rally. Israel does not have the manpower to do another six day war, not with all the hardware the sons of Ishmael have now. So are we talking low level nuclear and a realm of USA haters because "Bush failed to contain the Israelis". That is exactly what I think it's headed to. In the long run, Israel ends up being occupied for 42 months, from the back of my history book. For it to be "occupied" it has to exist. So with all the holy people not caring about what's holy 'Thou shalt not kill' whoever wins is another's choice. It doesn't take a rocket scientist to figure out that the US could get in serious trouble fighting in two hemispheres with a serious lack of oil. China wants Taiwan and whoever sells their bonds will inhibit the other ones from selling theirs. Money is bullets in the financial war. The fed uses bonds to soak up excess M1 and M2. Monetary expansion is only jeopardized by a lack of economic expansion. If the US is able to tender its currency all over the world then that is how far the tentacles reach. Only where there is an alternative do we see competitive fiat systems making inroads to the big scam. I'm a realist. The US dollar is now backed by the big gun. Does anybody want to play? So as we see the European bloc forming under monetization of the euro that is not "backed by gold", the Americas under the dollar, and the Asian Tigers in their own circus with the yen. Britian ends up breaking up because its too small. What's a pound of pounds worth without any gold behind it. So Europe gets the UK islands near it. Australia will kiss up to the US for a new clear umbrella. And Canada is going to end up as the 51st state of America infront of Mexico that's destined to be the 52nd. Repatriation of wealth is the circus of this decade that no one can get a real grip on. Who can measure M3? The derivative casino is a deflationary force that soaks up dollars that may never get redeamed for real goods. That is where I see the water coming over the edge. Dollars will eventually get redeamed for real goods. Its amazing how the whole world loves green ink and paper. But for how long? There aren't many hamburgers at the stand for all the coupons they have printed. Britain may cave in to the Germans and go with the Euro but they aren't going to sell out of the USA. It's not a all-or-nothing scenario either. The rich have freedoms to domicile their wealth anywhere they want to. The Euro is near the status of the Confederate States of America 1860's style. They had two futile wars for a union but no one could speak enough German. So why do you think they can get a union without force? People in high places sipping wine just give up their power. Yeah the Federal guys all move down to the state level and the state guys move down to the local level. But where do the local guys go to? Oh yeah, they all go home. Never son. The southern Euro members will bleed the union dry with mismanagement. Lira into the river because they're too heavy to carry around. The only way the US could keep their union together was by force in a bloody worthless civil war. Europe is going to try it the peaceful way. Why do some goldbugs think the whole world needs to get to Armageddon for the POG to hit 1000. If gold was like any other commodity that was in demand as it is right now it can do 1000 POG. The dollar can go up with gold I've seen it. I'm more bullish on gold when I see that because it makes no sense. It shows an extreme demand not fear driven. When the dollar goes up and gold goes up it means a purer demand for gold is present in a proactive trend not merely reactionary. Like how Eggnog only comes around once a year. It's unique. I'm not touting geld moaning shares because its takes alot of guts to hold them. Look up ASL and check for the crash down, ABX and AU are about as scarey, sometimes the robbers get stuck in the hedges and can't escape. Just wait, all is not wonderful in the world of mining finance. When they want to buy back stock they flood the mines. Not that they have to add any water as they flood naturally when they turn off the pumps. Then they survey high grade areas and project vast reserves. Enron would never happen at a gold mining company because the accountants there are so much more adept at hiding numbers with new acquisitions. It's what it is, gambling. And everything I said is wrong if POG spikes up to 310 and holds. Hopefully I opened up a few cans of worms so we can spark up some more worthwhile discussion in keeping with the heritage of the greatest forum in gold. To keep truth in your innermost being I think one must run the gauntlet of this world. Getting ridiculed and jabbed is nothing new for the older goldbugs. I bought my first 3 Kruggerands at 174 and sold at 385. All my grass cutting money, hard earned kid cash. Those were the days. Then interest rates hit 22% and there were lines outside coin stores of people wanting to buy gold at 800 an ounce. The gold rush of '79...............to be continued............. :)

http://biz.yahoo.com/djus/020402/200204021223000508_1.html

MOSCOW -(Dow Jones)- Russian oil companies are struggling to replenish reserves this year, the news agency Interfax reported Tuesday, citing Deputy Energy Minster Valentin Shelepov.

Expected new reserve discoveries this year will be less than last year, Shelepov told a press conference in St. Petersburg .

In 2001, the country discovered about 300 million metric tons, or 2.2 billion barrels, but produced 347 million tons, or 2.536 billion bbl, an average of 6.950 million barrels a day.

Shelepov didn't forecast how much oil would be found in 2002, but said: " Distressing reports have been coming in from explorers in the first few months of the year."


Black Blade: As I have posted before. Don't look to the former Soviet republics for oil.

Hey friends, relax. Mood of the forum is starting to resemble day traders with more than they can afford bet on the come.

QUIT LOOKING AT EVERY LITTLE SPIKE, DIP, AND TRYING TO FINE TUNE THE MARKETS. Wether spot or paper.

YOU'LL DRIVE YOURSELF NUTS!!!!! Calm and confident should be the mood of the day, week, month and year as we watch what we believe, come to pass.

Gold and Silver are moving up. We know why. PM stocks are moving up - THEY WILL LEAD SPOT JUST LIKE THE SM'S LEAD THE ECONOMY. Stocks will not move like spot, they are more emotional because they are easier to buy and sell. Today they are neither ahead of gold or behind it, they are just there. Tomorrow will be different. They do not have to move in tandem and make sense hour by hour or even day to day.

Stock buyers are not spot PM buyers and vice versa. Some of us here are part of a small group that both buy spot and dabble in a little bit of paper. Most buy paper and are in for the short term. Don't follow the herd. NOTHING MOVES STAIGHT UP (OR DOWN FOR THAT MATTER).

Keep adding to your physcial position - it's the safest bet in town. THE FUNDAMENTALS HAVE NEVER BEEN BETTER IN ANY OF OUR LIFETIMES.

If you play paper (and most of us do), take your positions, ride them up - that's where they're going LONG TERM - and liquidate as you feel comfortable and buy more physical. Gold and silver are ready to break - up -. When they do, at the worst case senario IMHO, 10 to 15 years from now, gold should be trading in the thousands. Silver in the hundreds. May be 1 to 3 years - so what. Most of us still think in terms of fiat. THINK IN TERMS OF WEATH ACCUMULATION AND ANY FIAT YOU MAKE, INVEST IN WEALTH. We know the definition of wealth - Don't we???

Keep the faith and patience will be a virture you can either retire on or live very well (at least better than your peers.)

For those of you who like silver (I do), keep the faith. 90% of this country either can't (thats most of them) or won't buy gold because of price. When the bulk of the populace finally figure out what we know, just what in the heck are they going to buy???? My guess is silver.

GR2 - WHAT???????

Pizz

Sorry, but I don't speculate with futures contracts. However, I believe that the long-term outlook for energy is higher prices due to dwindling supply and increased demand. That said, it is possible that Middle East tensions may smooth out and oil prices might pull back some. I tend to invest in energy trusts (oil and natural gas), partnerships (propane), niche energy markets (uranium fuel reprocessing), natural gas pipelines, and some natural gas dominated utilities. And Gold and Silver of course.

The point is that we are not likely to see "Cheap Energy" again. The transmission grid is antiquated and in serious disrepair. Any economic recovery will only increase demand for energy � energy that we simply do not have. Energy is one cost that must sink straight to the corporate (and consumer) bottom line. This cost cannot be avoided or trimmed back if corporations wish to expand production. The bull market of the 1980's and 1990's were mostly due to an abundance of "Cheap Energy". Therefore any economic recovery in the short term is speculative at best.

In fact over the last couple of days while the price of oil and natural gas (and Gold) were rising strongly, the same oddball statements about "energy is not important to the economy anymore" were heard on various financial media. Even Alan Greenspan said such nonsense. Yet during the tech and dot.com boom we saw a tremendous growth in computers, server farms, increased telecom use of the Internet, a general rapid growth in industrial manufacturing, etc. The system finally imploded and the result was rolling blackouts in California, near collapse of the electrical grid on the East Coast (New York in particular), and states such as Washington refusing to sacrifice energy for energy deprived California (partly due to drought and partly due to phenomenal demand increases).

Since energy is strategically important to US national security and economic prosperity there have been calls in some quarters for an Energy Marshall Plan" to develop energy sources with the goal for energy independence. This is a desirable goal of course although extremely difficult given the political realities. It is possible that there will be a push from official quarters to move toward energy independence (possibly through a combination of conservation measures, relaxation of some environmental regulations and tax breaks). This of course will take several years. Therefore the long-term outlook for energy (natural gas in particular) is very strong.

This brings us to Gold and Silver as portfolio insurance. Every postwar recession has been preceded by an "energy crisis". Whether it was the 1973 Arab Oil Embargo, the 1979 Iranian Revolution and Russian Invasion of Afghanistan, or the 1990 Gulf War, each event preceded an economic recession. Of course Gold and Silver prices responded as well they should during periods of economic uncertainty. Some these event also led to double digit inflation and prompted politicians to emplace price controls. The end result was make a bad situation worse. We also know that Gold and Silver rocketed to record high prices. So from my point of view one could do well to invest in energy and insure ones portfolio with precious metals (the alternative currency).

I hope this helps, Cheers!

- Black Blade

Question of $20. or $30. day runs.....From my view that would be lovely to see, 'BUT'
Remember Oct. /99 Gold ran up as much as +/- $10/$15 a day for a couple days and went from ?$260. range to $325. range +/-(I don't remember exact #'s) but my point is it stayed up for about 10 days/2 wks and the shorts (major ones)& Cabal never blinked, they just drove it back down over time. What I wish to see is the small but significant moves we're having now continue and the shorts continue their Kamakaze dives over a period of at least 30 days give or take and when they wake up and and smell the fire it will be too late and then and only then will they "PANIC" and feed the non-extinguishable fire with their own buying. I know about "ALL" the factors that can and will fuel the fire but think we definately need long exposure to higher prices before the Cabal will abandon the leaky ship that they have kept afloat for so long.....FWIW....YGM

PS: I do believe that time is finally under way and not another false hope. Their Bilge Pumps are worn out with rhetoric and over use. Go Physical & Sleep Well.

http://www.financialsense.com/Market/wrapup.htm
Energy on the Rise

Snippit:

Tensions in the Middle East, rising oil prices and lower profit forecasts all weighed on today's markets. Oil prices rose by $0.83 a barrel to $27.75, while natural gas prices ended the session with a $0.09 gain at $3.635. Prices of energy have been rising across the board due to rising tensions in the Middle East, which could cause a disruption in oil supplies to the West. Oil prices climbed higher after Iraq, a key OPEC state, threatened to cut off supplies to the West to force Israel to capitulate to Palestinian demands. Iraq is in discussions with Iran to impose and oil embargo against the U.S. should it decide to support Israel or move against Iraqi leadership. Iran has been caught supplying Arafat with arms, putting it on the list of states that contribute and support various terrorist groups such as Hamas, Hezbollah, Fattah, and al Qaeda. Today, Iran said the use of an oil embargo could be very effective in forcing Israel to withdraw from Palestinian territories. Iraq and Iran are moving to gain consensus with other OPEC members for an oil embargo against the U.S. and its allies in the region. With OPEC having cut back oil production and inventories of oil falling more than expected has resulted in oil prices heading back towards $30 a barrel. Crude prices at the end of the day were at their highest level in more than six months.

The growing conflict in the Middle East is also helping to push up prices in gold and silver. Gold prices closed at $306.90 on the NYMEX while silver prices rose $0.04 to $4.74. Up until recently during periods of political tension or an economic crisis, the U.S. dollar was the preferred haven in times of crisis. Not this time. The greenback is now considered vulnerable, and the attack on the Trade Towers also shows the U.S. itself is susceptible to attack. Therefore, global investors are turning toward gold and silver as a safe refuge during times of economic and political turmoil. Central bankers are trying to fight the shift out of paper assets into gold and silver by trying to resurrect the gold carry trade, hoping to encourage the selling of gold. Right now gold lease rates have come down while Treasury yields have gone up. The spread between the two rates, what it costs to borrow and sell gold, and invest in U.S. Treasuries has widened over the last three months.



Black Blade: Another interesting article.

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20World%20News&s1=blk&tp=ad_topright_topworld&T=markets_bfgcgi_content99.ht&s2=ad_right1_windex&bt=ad_position1_windex∣dle=ad_frame2_windex&s=APKnL3RU4VS5TLiB0
Snippit:

Washington, April 2 (Bloomberg) -- The U.S. will reach the limit of its authority to borrow money on April 4, forcing the Treasury Department to tap a $40 billion civil service retirement fund to prevent the government from defaulting on its debts, Treasury Secretary Paul O'Neill said.

In a letter to congressional leaders, O'Neill said their refusal to lift the mandated $5.95 trillion debt limit will force him to tap the Federal Retirement Thrift Savings Fund, also known as the G-Fund.

Over the next 10 business days the government has obligations totaling $45 billion to $55 billion, including $27 billion in Social Security payments which it would be unable to meet without the maneuvering.



Black Blade: Can you say: "We're bankrupt!" I knew you could.

http://www.handelsblatt.com/hbiwwwangebot/fn/relhbi/sfn/buildhbee/cn/GoArt!201098,201098,515813/SH/0/depot/0/index.html
HB/svu D�SSELDORF/BERLIN. As the Middle East conflict escalates, economists and other experts are debating the extent of the threat that rising oil prices can be said to present to the upturn in the global economy expected later this year.

The Organization for Economic Cooperation and Development (OECD) said that if the price of oil rises by a further $10 a barrel, it could shave half a percentage point off GDP growth in the industrialized world. Based on this calculation, Germany's GDP would grow by just 0.2% in 2002.

The current oil price already stands above the upper level of $25 a barrel on which the German government's council of independent advisers based its economic forecasts in autumn last year. "Expensive oil is a risk factor which we didn't see at the time," said Jens Weidmann, general secretary of the council. But the council as yet sees no reason to revise down its GDP growth forecast of around 0.75% for 2002.


Black Blade: These are rather optimistic projections IMO. Many foriegn countries are basing an economic recovery on a "supposed" Us economic recovery.

http://www.iht.com/articles/53290.html
Snippit:

If nerves are jittery right now in the Middle East, jitters likewise are rippling through the oil markets - and from there rattling perceptions about inflation and world economic growth. For now, the sharp jump in oil prices this year - and particularly in the last couple of weeks - isn't causing economists to race to their computers to recalculate global growth rates.
.
But the increase is prompting some observers to question earlier assumptions on worldwide inflation. And if inflation levels are climbing, then doubts begin to arise about the future strength of consumer spending, especially in the United States, and about the vigor of the global economic recovery.
.
With Iraq and Iran both threatening Tuesday to use a cutoff of their oil supplies as a weapon in support of the Palestinians, the Middle East looms large as a powerful catalyst - along with the recovering world economy - to higher oil prices.
.
But the increase is prompting some observers to question earlier assumptions on worldwide inflation. And if inflation levels are climbing, then doubts begin to arise about the future strength of consumer spending, especially in the United States, and about the vigor of the global economic recovery.

Several months ago someone here posted up the URL for a peculiar web site that proclaimed that around this time there would be great turmoil in Israel and throughout the world. It was called something like "Zion Time". I only scanned it briefly, preferring to bookmark it and come back to it now, when the time was ripe. I do recall, though, that it had something to do with specific advice for Jews and non-Jews on surviving the crisis which they claimed was imminent, part of which involved tearing a dollar bill in half and sending half to them in Israel. Anyway, the bookmark I had for that site no longer seems to work. Considering recent events, I was curious to do a more comprehensive read of what they had predicted. Any information on where that site may have moved to if it still exists at all?

<>

Strange - I don't clearly understand this statement. I always believed that one had to own goods (and be in debts) in case in inflation rather than owning cash.
Since product will be more expensive in one month than today, I will buy it today and sell it in one month, even sometimes if I have to get in debts. So this is likely to accelerate the spending - not the opposite.

What did I miss ?

http://news.bbc.co.uk/hi/english/business/newsid_1906000/1906265.stm
Snippit:

Japan's finance minister has delivered a tongue-lashing both to his own officials and to Japan's biggest bank, Mizuho. In a near-unprecedented public tirade against both the bank and his own officials, Masajuro Shiokawa complained that the urgency of Japan's financial problems was not getting through to them.


Black Blade: At least someone understands the dire situation surrounding insolvent Japanese banks and the crumbling Japanese economy. It appears that the Japanese government pension fund came into the market to give support to the Nikkei that fell off a cliff at the start though finished positive by +196 points at the end of the trading session.

http://550.org.il/index.htmlThe site goes around in circles a bit.....enjoy!

Greetings Pippin,

Both you and BB are correct: inflation causes the value of each fiat unit to be worth less so you must pay more for the same goods than you did previously. During gradual inflation, many go into debt to purchase goods to be paid back later in devalued fiat.

But at some point, the inflation begins to get out of hand - the bond market starts to demand higher interest rates to take on the risk of buying bonds, and this forces the central banks to raise rates to cool off the economy -> decreased consumer spending.

Cheers.

nickel62, great post from Henry Liu, with lots of perspectives on the big picture as we may not have seen it yet. The move to US finance capitalism ahead of Chinese and others is a game-ending move, but not a winning one. "Resigns."

Pizz -- good reminder to keep eyes on Wealth.

GR2 -- great first post! A little bit of Harry Schultz, by way of Vonnegut & Joyce, eh? (Or is it Tom Robbins?) BTW, (ask R Powell for our old homies list), might your Gauntlet be Rt. 9, if your valley be the happy one?

With the help of Fibonacci on POG (LT) : When POG goes through 308$ (with two day closes) >>> GOLD is set FREE !
NIA = No Investment Advise !

CBII : The article by Henry C K Liu = Marvellously worded and the greatest encouragement for all those, not yet *Physically* into the yellow lifeboat. Thanks.

Mr Liu certainly walks the path less tread eh? Great perspective - a little bit of the Oil "SPONGE" factor ( rising oil prices to sop up US$'s )we are witnessing - NOT to cause inflation but rather to attempt to control DEflation!! "Black Gold"..HA!....rather more like "Liquid Paper".

http://quotes.ino.com/chart/?s=FOREX_XAUUSDO&v=i&w=1&t=l&a=1
Gold was under pressure in after hours, though now has recovered above the $305/oz. level (see graph). Meanwhile tensions in the Middle East are still a concern as street battles have broken out with several Palestinians taking sanctuary in a christian cathedral and another group in a christian convent. Israeli tanks have moved into Jenin and are about to move into some other West Bank towns for house to house searches and minor skirmishes.

Iraq and Iran (at the behest of Iraq, the PA, and Hezbollah) both are now contemplating an Oil Embargo against the west. Combined they both can create shortages that would resemble the 1973 Arab Oil Embargo. It appears that this situation has a way to go yet.

- Black Blade

http://www.msnbc.com/news/732418.asp
Despite rebound, firms� profit crunch haunts recovery

Snippit:

THAT�S BECAUSE THE mildness of the recession masked a ferocious corporate-profits crunch that has many chief executives still slashing jobs and other costs. If they continue, the cuts could slow the recovery. But the recession was one of the harshest in memory when measured by changes in profit levels. The Commerce Department said aftertax corporate profits declined 15.9 percent last year, one of the worst annual profit declines since World War II.

Black Blade: And it's not getting any better. Profits (the real kind of profits) have failed to materialize in spite of the wildest Pro Forma accounting from the Arthur Andersen school of finance. The investing public now more than ever realize that the Emperor wears no clothes.

04/02 10:18
U.S. to Tap Pension Funds to Avoid Hitting Debt Limit (Update1)
By Simon Kennedy

Washington, April 2 (Bloomberg) -- The U.S. will reach the limit of its authority to borrow money on April 4, forcing the Treasury Department to tap a $40 billion civil service retirement fund to prevent the government from defaulting on its debts, Treasury Secretary Paul O'Neill said.

In a letter to congressional leaders, O'Neill said their refusal to lift the mandated $5.95 trillion debt limit will force him to tap the Federal Retirement Thrift Savings Fund, also known as the G-Fund.

Over the next 10 business days the government has obligations totaling $45 billion to $55 billion, including $27 billion in Social Security payments which it would be unable to meet without the maneuvering.

Treasury will sell $46 billion in short-term cash management bills this week to cover those expenditures. By mid-April, a slew of income tax receipts will provide the government with fresh cash and end the need to juggle funds. In his letter, O'Neill said he would end use of the G-Fund ``on or about'' April 18.

Congress has refused O'Neill's repeated requests to raise the limit by $750 billion, a move necessitated by additional spending for the war on terrorism, a drop in tax receipts brought on by the recession, and regularly increasing payments for Social Security benefits.

``We must continue working to enact an increase in the statutory debt limit as quickly as possible to avoid any negative repercussions at home or abroad,'' O'Neill wrote in his letter, which was released by the Treasury Department.

Following Rubin's Lead

Republicans in Congress want to maintain the limit as a check on spending. Democrats want to keep it so they can blame President George W. Bush's tax cuts for the government's inability to pay its debts. Congress is now in recess until April 8, and no action is expected for several weeks.

In tapping the G-Fund, O'Neill is following the lead of former Treasury Secretary Robert Rubin.

The last time the government reached its borrowing limit, in 1995 and early 1996, Rubin reworked auction schedules, stopped selling savings bonds and manipulated government retirement accounts such as the G-Fund to find $139 billion and remain beneath the ceiling.

The G-Fund was created in the early 1980s. Its assets are represented by a non-marketable government security with a one-day maturity. Each night, a new security paying the latest interest rates automatically replaces the maturing one.

Beneficiaries Protected

By suspending the nightly update or rollover, and leaving an IOU in place of the assets, O'Neill extinguishes debt, enabling Treasury to sell new notes or bills without threatening to breach the debt ceiling.

``G-Fund beneficiaries are full protected and will suffer no adverse consequences from this action'' because the money will be paid back in full once the debt limit is raised, O'Neill wrote.

``In short, the result on the G-Fund and its beneficiaries will be the same as if this temporary action had never taken place,'' he wrote.

Treasury officials have also used regular auctions to buy time. The department's debt managers pared the size of 4-week bill auctions, cutting issuance to $19 billion from $23 billion. They also capped the amount of two-year notes sold in March at February's level of $25 billion.

In a statement, Peter Fisher, Treasury undersecretary for domestic finance, said the department would take ``every prudent step'' to avoid breaching the debt limit. ``As we work with Congress to raise the limit going forward, we will do our utmost to avoid disruptions in our normal borrowing patterns,'' he said.

The government sells securities to pay its bills while it waits for tax receipts to come in, and to pay the interest on existing debt. The first debt ceiling of $11.5 billion was introduced in 1917. It reached $1.1 trillion in 1981 and was last boosted, from $5.5 trillion, as part of a bipartisan balanced budget agreement in 1997.

Few Repercussions

While the 1995-1996 crisis injected volatility into the $3 trillion government security market, few analysts expect there to be any repercussions from O'Neill's moves.

Treasury began to highlight its problem in December and signaled that it was considering copying Rubin's strategy, limiting the likelihood that the maneuvering will cause higher interest rates, analysts said.

``They made it clear early enough what they were thinking of doing so they'll not incur costs,'' said Lou Crandall, chief economist at Wrightson Associates Inc., a research firm.

And unlike 1996, when Moody's Investors Service placed U.S. debt ``on review for possible downgrade,'' the creditworthiness of U.S. government debt is not in doubt now.

``It's still the top credit on the planet,'' said Sean Egan, managing director of Egan-Jones Ratings Co. in Wynnewood, Pennsylvania. ``Terrorist attacks didn't change that so neither will this.''

Political Fallout

There are some risks. Foreign investors who don't understand the nuances of his actions could begin to ``question the credibility'' of the Treasury when it says it can back up its debt obligations, said Gerald Lucas, a government bond analyst with Merrill Lynch & Co. in New York. That could mean a rise in interest rates.

``There are methods to get around Congress, but when it's playing politics with the debt limit that leads to a risk premium on U.S. debt,'' he said.

Rubin's actions in 1995 also brought threats of impeachment from Republicans in Congress.

The worst O'Neill may face is criticism for touching retirement accounts at the same time as lawmakers are complaining about the impact of Enron Corp.'s collapse on its employees' pension funds, said Stephen Stanley, an economist at Greenwich Capital Markets Inc. in Greenwich, Connecticut.

``There may be political fallout because the Enron crisis has raised sensitivity toward retirement funds,'' he said. ``But that will be the only fallout.''
***********************************************************
For the record:
I am personally fully invested in this US Government fund as a former civil service employee. This is not the first time the "G" fund has been used as a political football.
This fund is safer than ANY US Treasury issue, period. It is a special issue US Treasury fund open ONLY to US Government employees, including US Senators and US Congressmen.
"It is better to refrain from commenting when one does not know of which he speaks"
Good Day,
"G" man

The "Deep Post" high grade underground mine was located under the open pit mine but I only saw this information posted on Le Metropole Cafe website. Now I can't seem to locate it again..This is a quote from a mining executive's letter sent to Murphey and published there on the web site.


"Do you find it interesting that recently Barricks Betze Open Pit in Nevada failed a little earlier than expected bringing down 70 Million tons of rock. Guess where it landed ? On top of the Deep Post underground mine, burying 180,000 ozs of gold forever. And my my not a word in the press. Why ? Because the failure was expected ? Maybe, but not the loss of the ounces in the Deep Post !!!!!!!!!!! Ounces that may be important to delivery into thier hedge ? This information came to me at an annual mine safety refresher class given by the State of Nevada ...."

Here is a sign that the manipulation is finally being recognized for what it is...Goldman did manage to get it released on Good Friday when the markets are closed...maybe we can help them get it publicized a little more broadly...too bad CNBC hasn't had a chance to mention this yet! Must be too busy touting GE 30 year bonds...
Goldman May Be Charged Over Bond Trading, People Say (Update1)
By Vicky Stamas


Washington, March 29 (Bloomberg) -- Goldman Sachs Group Inc. has been notified that the Securities and Exchange Commission enforcement staff plans to pursue a case against the third-biggest securities firm for trading Treasury bonds based on inside information, a person familiar with the case said.

The agency began investigating Goldman after a consultant the firm had hired gave traders advance warning Oct. 31 that the U.S. Treasury Department would stop selling 30-year bonds. The $3 trillion Treasury market rallied, with the 30-year bond having its biggest one-day gain in 14 years.

The SEC notification, called a ``Wells notice,'' is one of the last steps before the agency's staff asks the commission to discipline a securities firm by filing a civil lawsuit or administrative proceeding.

``It means the staff has reached a conclusion, subject to your persuading them otherwise, that your client ought to be charged with some violation of the federal securities laws,'' said John Olson, senior partner at Gibson Dunn & Crutcher in Washington.

A case against Goldman would be the first insider-trading bond case in memory, some lawyers said. ``I'm not certain I can recall a single case involving bonds, but there's absolutely no reason that a case could not involve bonds,'' said Joel Seligman, dean of the Washington University School of Law. ``It can involve any security.''

Lucas Van Praag, a Goldman spokesman in New York, declined to comment, as did SEC enforcement chief Stephen M. Cutler and Treasury spokeswoman Betsy Holahan. The consultant hired by Goldman, Peter Davis, president of Davis Capital Investment Ideas, had no comment.

Davis also received a Wells notice, according to the person familiar with the case.

Explaining a Surge

Goldman spokesman Peter Dietlmaier said Nov. 12 that the firm was among the companies told of the Treasury's decision before the government announcement. The firm didn't engage in wrongful behavior and will assist authorities with an investigation, he said at the time.

The firm, the third largest by capital, wouldn't comment then on whether its traders tried to benefit from the information by buying bonds before the government's announcement. Securities laws prohibit trading on non-public information.

Davis said he told clients of the Treasury's decision to stop selling bonds, based on a press briefing he attended at 9 a.m. on Oct. 31, before the department made the announcement at 10 a.m. Government officials held the briefing, intended for reporters, on condition that the media not release the information until 10 a.m.

The Treasury itself posted the news on its Web site at 9:43 a.m., 17 minutes before the embargo ended.

The Davis leak helped explain a rise in prices that at the time dumbfounded traders and investors in the bond market, where $300 billion of securities trade daily.

The benchmark Treasury bond price jumped from 102 1/2 at 9:30 a.m. New York time, when the meeting with the press ended, to 104 at 10 a.m. By contrast, between 9 a.m. and 9:30 a.m., the bond traded within a range of 1/8 point.

Treasuries had fallen on an 8:30 a.m. report that showed U.S. growth in the third quarter exceeded expectations. Traders scaled back bets that the Federal Reserve would lower its target interest rate by half a percentage point.

Buying soon overwhelmed those who were selling on the economic report. The rising bond price sent its yield down 9 basis points in the 12 minutes before 10 a.m.

Falling Yields

The price surge wreaked havoc among bond traders, many of whom were locked into bets that yields on 30-year bonds would rise relative to short-term debt, such as two-year notes, traders said.

Instead, the bond buying shrank the two- to 30-year yield gap by 30 basis points in a few hours, marking the reversal of the strategy that had proven profitable for almost a year.

By day's end, the Treasury's announcement had sparked the biggest one-day gain in 14 years, and pushed the yields to levels not seen since Russia's debt default and the collapse of hedge fund Long Term Capital Management in 1998.

U.S. Treasury General Counsel David Aufhauser said in November that his agency would ask the SEC to investigate the matter.

Davis said he also disclosed the Treasury's decision to Stone & McCarthy Research Associates and Capra Asset Management. Ray Stone, a managing partner of Stone & McCarthy, declined to comment.

James Capra, president of Capra, didn't return a call. He chairs the Treasury Advisory Borrowing Committee, a group that advises the government on the mix of debt securities it sells. The group had recommended the elimination of the 30-year bond in January 2000, when surpluses were projected to continue growing. Traders hadn't expected the bond to be eliminated because a return to budget deficits meant an increased borrowing need.

The SEC has authority to determine whether insider-trading laws have been violated. It can subpoena trading records to see if Wall Street firms were given advance notice of the Treasury's decision.

burying 180,000 ozs of gold "forever"From a Goldminers viewpoint a couple things spring to mind.. Firstly, nothings buried forever! Not if the grades were high enough. Secondly, if it buried the part of the deposit that was being worked underground then a new adit is not that expensive to open. Remember they had to move alot of overburden in the first place to get to the Gold. Also all large Cap miners like ABX don't even mine small deposits like 180 K oz's. They usually sell off any property with less than 500 K oz's to a junior producer. All things considered it seems like either smoke and mirrors for whatever reason or media is making too much of it....FWIW....YGM.

http://markets.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3X6RGJJZC&live=true&tagid=IXLTN37YICC⊂heading=currencies%20&%20money
Japan deflation unmoved by monetary base growth By Mariko Sanchanta.

---Japan's monetary base surged in March by its largest monthly increase in 28 years, the Bank of Japan said on Tuesday.

The monetary base, a combination of bank reserves and money in circulation, rose 32.6 per cent year-on-year to Y87,150bn, and has risen consecutively for over a year

Banknotes in circulation increased by 14.6 per cent in March year-on-year, following a rise of 12.4 per cent in February. ---

I know you are an actual miner with many years of experience so I appreciate your comments. But if I am correct and I have been to the Goldstrike property five or six times with both Barrick and Newmont over the last ten years, the Betse Post deposit was one of the northernly parts of the gigantic open pit that used to be a mountain that was collectively called the Goldstrike Mine. It was located in the northern part of the property right near the property boarder with Newmont. What I interpreted happened is that the slope was too steep and collapsed a little sooner then expected and closed access to the underground, I assume from the bottom of the goldstrike open pit with the 70 million tonnes of waste falling from the sides of the open pit. If that is the case it might mean that the economics of getting to that portion of the underground deposit beneath the open pit is no longer viable economically. Newmont's underground is also under their deposit a few miles away and if I remember correctly the Deep Post deposit was a large deposit that was accessed via adits driven into the bottom of the open Goldstrik pit and it seems that was the access that was "lost" under the collapsed overburden from the pits collapse. With all of the forward hedging I wonder why no one has mentioned this before though if it was indeed true. There must be at least a few Nevada miners that lurk at this site or citizens of Elko Nevada that might have some accurate information on this situation. Thanks for your insight YGM, If I remember correctly you had a gold deposit with some high grade ore that was troubled by mud separation in the Yukon. Is there any chance that mine might be economic here again?

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=APKsDlxX4VS5TLiBU

New York, April 3 (Bloomberg) -- U.S. Treasuries fell on concern inflation will accelerate as the economy rebounds from recession, dimming the allure of fixed-rate investments.

Federal Reserve Bank of Kansas City President Thomas Hoenig last night said the economy is growing faster than expected, bolstering expectations the central bank will raise interest rate by midyear to curb faster inflation.

``The longer rates stay at this level, the greater the likelihood that credit to finance growth will accelerate, the money supply will accelerate and inflationary pressures will result in time,'' Hoenig said in a speech to a Kansas City economic forum. He is a non-voting member of the Federal Open Market Committee, which convenes next on May 7.

His comments differ from those of other Fed officials, including Robert McTeer, president of the Fed Bank of Dallas, who said last week he is ``in no hurry'' to raise rates. Both San Francisco and Philadelphia Fed Presidents Robert Parry and Anthony Santomero have said they expect inflation to remain under control.

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=APKsDlxX4VS5TLiBU

New York, April 3 (Bloomberg) -- U.S. Treasuries fell on concern inflation will accelerate as the economy rebounds from recession, dimming the allure of fixed-rate investments.

Federal Reserve Bank of Kansas City President Thomas Hoenig last night said the economy is growing faster than expected, bolstering expectations the central bank will raise interest rate by midyear to curb faster inflation.

``The longer rates stay at this level, the greater the likelihood that credit to finance growth will accelerate, the money supply will accelerate and inflationary pressures will result in time,'' Hoenig said in a speech to a Kansas City economic forum. He is a non-voting member of the Federal Open Market Committee, which convenes next on May 7.

His comments differ from those of other Fed officials, including Robert McTeer, president of the Fed Bank of Dallas, who said last week he is ``in no hurry'' to raise rates. Both San Francisco and Philadelphia Fed Presidents Robert Parry and Anthony Santomero have said they expect inflation to remain under control.

Someone is trashing the POG in NY

I gave up and went bankrupt due to low Gold prices for last 7 years and am returning to the Placer workings of Dawson area (better grade creeks than my previous undertakings)
for the coming season on a wage and Gold sharing arrangement. No more shouldering of all the costs :))
An old adage of Placer miners is that the best way to mine is w/ someone else's money....YGM.

PS: Let the Cabal and Short crazies hammer Gold (ie: today's a good example of my last nites post) they will eventually find the anvil of physical offtake to much to bear. We still may be months away from that time IMHO....
People buying paper Gold will not keep the price high. Only those taking delivery of Physical will do that. Again just my opinion.....YGM

Will prove itself if.....The buyers are laying in the weeds waiting to go again after the Cabal have driven the price backwards to the limit. We'll see what the buying strength and true demand is then. This fools game they play couldn't be any more perfect for those players with deep pockets like Soros or Buffet etc........YGM.

Hoping that the ceiling is turning out to be a new floor. More later - Best cb2

@ Belgian: Hello, friend -seems youre interpreting our chinese friend Liu as I do.

@ Nickel - You're more than welcome and re Betse Post - have heard same rumours too, though didn't have time to verify. BTW, YGM - good to see ya back - hope everything is going well with you!

@ Lady Leigh - thanks for your kind message before Easter - hope you've had also a great one.

Wow looking around at the gold mining stocks
they are really being taken to the woodshed.
This all started yesterday with the gold stocks down from
3% to 8% and then with gold falling today down 4.50 at 8:45am cdt we have seen all of this week and last week gains
wiped out, with the big losses in glg, gold, cde, I hope
the 300 mark can hold if not look out below.. Truthcaster

Yes that would be terrible if gold were to punch through $300! It would be almost a 2% drop certainly a reason to panic. Man thanks for sharing your insights about the downside potential..

Newmont is off less than a $1.00 per share as we speak trading at $27.59 off it's low which is a same because I was trying to buy more. AEM and Goldcorp are barely off their highs. The hedgers are down less then a percent and a half...Where exactly are you seeing this collapse?

I got wacked at the other side of the business as an investor so I understand the situation quite well. Do you have any insite into the situation of the old Wolverine Discovery that was trumpeted by Aetna Reasources in late 1995 and then ended up being controlled by Archer Cathro who are big in the Dawson area if I recall correctly. There was some talk of refinancing that property through their Expatriate Resources but I have lost touch. Any rumors in your area? Thanks in advance and good luck. Welcome back.

Feel free to respond if you care to continue. Or are you simply intested in making sure that the market gets your words of wisdom about the potential dangers of falling gold prices?

GLG an old time Canadian spec stock which is off 2.6% intraday, GOLD or Goldfields is off .38 cents on a $10 plus stock after having doubled in the last four months and Cour de lane is a silver stock and is off 2 cents, hardly a reason to throw myself or any investor off the Brooklyn Bridge...what exactly is your interest in posting here?

Did I miss comments by this Mr. CK Liu? Can you illuminate? Homeward bound....CM

Great thoughts on AU and AG; paper and metal.

Re: Mr. Liu - see yesterdays post by Nickel62 #72552. Cheers!

Wolverine Dep.I think it was an area play that lost it's luster. Atna president Peter Delancey (whom I know) is as sharp as a pin and never would have let it go otherwise. Atna had a good run w/ it tho....Expat----- is a ship of fools.

http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3GSK0BLZC&live=true&tagid=IXLI0L9Z1BCWorldCom to cut 5,500 jobs and redeem bonds
By Richard Waters in New York
Published: April 3 2002 15:56 | Last Updated: April 3 2002 16:04

WorldCom is preparing to cut up to 10 per cent of the jobs at its main business services division, according to a person familiar with the plans.

The cuts, which would affect as many as 5,500 workers, mark the latest attempt by the US telecommunications company to come to terms with pressures in the troubled long-distance and data communications industries.

The lay-offs will not affect the 20,000 workers at MCI Communications, WorldCom's independently-listed consumer long-distance business, the person familiar with the plans said.

Separately, WorldCom said it would redeem $700m of bonds issued by MCI. The repurchase follows persistent speculation that a shortage of cash would eventually force WorldCom to cut the dividend paid to MCI's shareholders, and possibly repurchase the tracking stock. The telecoms company had consistently said that it has no such plans.
+++++++++++++++++++++++++
Weeeeeeee! Isn't this recovery GREAT! Just imagine how much FUN these workers are having�.as they prepare to visit the local unemployment office.

Your insights as an actual participant in the business is invaluable to all of us.

Creative accounting and the destructive risk
By Henry C K Liu
Alan Greenspan, chairman of the US Federal Reserve Board, frequently credits US growth in the 1990s to a rise in productivity made possible by advances in technology. Yet studies have shown that computerization did not simulate much rise in industrial productivity in the 1990s. Industrial computerization was essentially in place long before 1995. The 1990s boom in the US was not an industrial boom but a financial boom. This was made possible by three developments: the deregulation of financial markets, the computerization of trading of financial instruments, and globalization, particularly financial globalization.

The entire structured finance (derivatives) phenomenon would not be possible without any one of the above mentioned developments. Structured finance in essence allowed an unprecedented explosion of credit, by unbundling risks for a wide range of risk-takers who sought corresponding compensatory returns. While hedging initially provided protection against volatility to individual market participants, it soon became a profit center for financial institutions. This led to the institutionalization of volatility as a market opportunity. Financial institutions actually sought volatility in the system to provide a continuous profit stream.

Creative accounting, whose peculiar logic evolved from structured finance, also made the traditional debt/equity ratio immaterial. Ways were devised for the large market participants to structure debt as hedges, through swaps that avoided taxes and balance-sheet liabilities. Swaps enabled borrowers legally to book loan proceeds as current operating income and loan liabilities as future capital expenditure that could be kept off the balance sheet, inflating current earnings. Circular counterparty risks suddenly became neutralized risk, and cash flow from swaps became net revenue. These practices are now known as Enronitis.

On the macro level, the global finance game has become a sure win for those who use dollars, especially those whose government issues dollars by fiat. The world market has become a place where the United States makes dollars and the rest of the world makes what dollars can buy. But after the Asian financial crisis of 1997, the whole world essentially adopted dollarization, if not directly, at least through hedges, albeit sometimes at prohibitive cost.

At that point, the US economy suddenly began to lose its exclusive dollar hegemony advantage because US entities were no longer the only ones with access to dollars nor could US transnationals avoid non-dollar revenue. To maintain the "strong dollar" monetary policy instituted by US treasury secretary Robert Rubin at the beginning of the Bill Clinton presidency, the US Federal Reserve progressively tightened dollar money supply throughout most of the 1990s. But this did not slow the US economy because structured finance permitted debt to expand without a corresponding expansion of equity. A strong dollar gave the US economy a boom in low-cost imports, while the US trade deficit merely forced foreign exporters to hold dollar reserves to finance the US debt bubble through a US capital account surplus. Japan did this for a whole decade, pushing its own economy into permanent recession while its dollar reserves mounted. Mainland China, Hong Kong and Taiwan took up the slack from Japan by 1995 and the three Chinese economies together now hold more dollar reserves than Japan does. China, starved for capital for domestic development, thus finds itself stuck with US$200 billion in US Treasury bills that pay 5 percent while it is forced to offer foreign direct investment high double-digit returns. The annual interest gap alone is in excess of $20 billion, which amounts to half of China's current annual foreign-capital inflow.

Growth in the 1990s came from a structural shift of the US economy from industrial capitalism to finance capitalism. Through financial globalization, the US shifted labor intensive manufacturing off US soil to low-wage locations, thus lowering the cost of manufactured products. Financial products and services and intellectual property valuation constituted most of the growth, making the US a consumer market of last resort for the whole world. London, Frankfurt, Paris, Tokyo, Hong Kong and Singapore became financial outposts of New York, sucking up dollar reserves to support the US debt bubble.

This game is ending, as the US consumer market becomes saturated and condemned to low single-digit growth, regardless of business cycles. The wealth effect from a tripling of equity value did not double consumption in the US, because aggregate demand is constrained by a widening income disparity. The rich have bought all the manufactured products they need and the working poor cannot afford to buy all they want. The wealth effect did double investment globally, reflected in the phenomenal rise in market capitalization of US transnationals and financial institutions, particularly in the so-called New Economy. The competition for credit favored double-digit growth markets in the developing countries, but the US continued to dominate global finance through its sophistication and innovation in finance and through dollar hegemony.

The problem is that all unregulated markets eventually self-destruct. Weak competitors are naturally forced off the market, leading to monopolies that are the result of market failure of competition. Yet regulation cannot cure the problem preemptively because remedial regulation only makes sense after disasters, never before.

There is increasing evidence that the real threat to China is not democracy or the market economy per se but the peculiar US version of these institutions. The 19th-century industrial capitalism that Marx observed no longer exists. Finance capitalism is a system in which capital is only a notional value upon which to build a gigantic mountain of hidden debt. Representative democracy and unregulated market fundamentalism in the US mode now work as legalized constitutional devices to disfranchise the poor and weak, both locally and globally.

Greenspan acknowledged this in his semiannual monetary policy report to the US Congress, before the Committee on Financial Services on February 27: "From one perspective, the ever-increasing proportion of our GDP [gross domestic product] that represents conceptual as distinct from physical value-added may actually have lessened cyclical volatility. In particular, the fact that concepts cannot be held as inventories means a greater share of GDP is not subject to a type of dynamics that amplifies cyclical swings. But an economy in which concepts form an important share of valuation has its own vulnerabilities." He was of course referring to Enronitis.

Greenspan's observation about the vulnerabilities of conceptual valuation was on target, although his warning of vulnerability was disproportionately misplaced. Even after the Enron and Global Crossing controversies, Greenspan continues to resist regulation, preferring to rely on market discipline. The risk is much higher than he admits.

Past records do not reliably project future vulnerability risk. Any risk manager knows that accidents are always waiting to happen. The fact that it has not happened in the past does not mean it will not happen in the future. In fact, with each passing day without an accident, the risk of borrowed time increases. Low probability is only a source of comfort if the impact is not fatal.

Also, what Greenspan did not say, but admitted by implication, was that finance capitalism is operating with less and less reliance on capital. Capital has become a notional value in structured finance. Credit is no longer anchored by equity but by circular hedges. Debt-to-equity ratio is no longer a relevant consideration. Practically all US major businesses nowadays, with their high debt leverage, would have negative real equity if the price/earning (P/E) ratio were to return to historical norms. Blue chips are being shut out of the unsecured short-term commercial paper market. Corporate credit ratings are inflated by exorbitant market capitalization value, which in turn reflects irrational P/E ratios. Even now, during what many on Wall Street contend to be a savage bear market, the Standard & Poor's 500 Index yields 25 times earnings. It would have to fall by another 41 percent to reach the median valuation prevailing since 1957.

Such a decline can happen in a period of days in this age of program trading and socialized risk, even with circuit breakers and trading curbs. When that happens, structured finance will be a sea of dead and wounded in counterparty casualties, regardless of who won and who lost.

Henry C K Liu is chairman of the New York-based Liu Investment Group.

I should have address the last post to Cavan

Your stocks that you were so concerned about an hour ago are now recovering nicely...the canadian gold Glamis is now down only a penny or two and Newmont is now off only 55 cents. Coure De Lane CDE is still of 2 cents and GOld is now off almost 37 cents WOW! Thanks for warning us about that disaster!

Found an interesting article in the electronic version of the Wall Street Journal with the subject "questionning the books".
Till now, I ignored that this type of investigations had already been started years ago, leading to surprising discoveries :

Quote
<>
UnQuote

So this is not an entirely problem. A two-year investigation does not look like normal auditing.

Restate four years of earnings!
I wonder what will happen if the SEC demonstrates that dividends paid to shareholders were exxagerated. Ask the shareholders to give them back :-) ?
Could this have a tax-related aspect? Because tax are paid on earnings and/or dividends in most countries. So if earnings were over-started, undue taxes were also paid...

One day, maybe, one will discover that cheating took place in the gold market-related accounting also...

http://csf.colorado.edu/pen-l/nov99/msg01829.htmlHere's a Henry Liu re-post on the longwaves forum...

http://csf.colorado.edu/forums/pkt/2000/msg02796.htmlHope you don't mind if I stick this (kinda long) up here for later reading -- I think I like this guy...

Truthcaster and nickel62, please reread yesterday's posts 72561 from The Stranger and 72579 from Pizz. They should give some comfort and calm your nerves.

GR2, hello, does the Connecticut River flow through that "happy valley" you refered to? I agree that the POG has entered and can sustain a long term bull phase without any major crisis. Many of the underlying potential crisis causing problems you refered are fundamental reasons supporting a higher POG but can do so just by their existence, their potential to cause crisis. Hopefully, most will be defused over time. A much higher POG is actually the solution to some of these, no?

YGM, good to hear from you again. Even when you left to work (driving heavy equipment?) for wages I thought that the lure of a substantial strike would be with you. May the force be with you when you resume the search!
Rich

http://www.msnbc.com/news/677951.asp?pne=msn"Latin Patriarch of Jerusalem Michel Sabbah offered sanctuary to Palestinian militants in Bethlehem's Church of the Nativity."

I've been. Very tiny place.

"A tank was stationed Wednesday at the edge of Manger Square, adjacent to the church."

David and Goliath. Roles claarly reversed.

Un-self-conscious arrogance.

Something not quite right here.

Including dumb moves on the chessboard of international relations -- and religions. Shooting yourself in the rear end. "Hey -- let's blow up EVERYONE'S religious icons while we're at it!" (Look what happened to the Taliban after they blew up those Buddhist statues.)

Bush and Sharon. Dumb and dumber. Can't these guys hire better advisors? Or, do they just not listen to the ones they already have?

I'm tryin' to get some work done today. Do I have to come down there and knock some heads together? That's what we hired YOU to do, Georgie. Tail wags dog again, don' look too good...

Just listened to their 12:30 report:

"...Gold beaten down today by the selling of a single large Bullion Bank. Their effort alone caused bullion to dip..."
* * * *

Now think about that...WHY WOULD YOU SELL GOLD IN THIS GLOBAL CLIMATE, INTO A RISING MARKET?!

If this doean't illustrate the desperation nothing does. 305 POG is NOTHING in historical terms!!!! But apparently it is something to be fiercly defended today thanks to a failed manipulation policy.

Don't know if this is related but just read that the Swiss were now selling 'only' 1/2 tonne per day, while up until recently they were selling 3/4 to 1 tonne per day. Perhaps they've increased selling today to make up for the reduced amounts of late. If not them, there's always the Germans to consider.

But ya know...who cares?!
Global demand will not be denied or deterred by strategic Central Bank selling. In fact, if they keep dicking around using reserves to fight a pissy little 305 mark, 'reserves' might become nothing but a memory after the dam breaks at 340.

It seem to me that there's every excuse in the books for a downed market. Yesterday it was 'waiting on government decisions', the day before it was terrorist attacks and fear thereof, and today it's trouble in the mid-east and worries associated. When the markets are slightly up, they're "Soaring!" "Cruising" "Blasting off" "ripping through the ceiling" and my favorite "Off the canvas." Positive notes on good days are solely responsible for a climbing market, and positive notes on bad days are conveniently weighted to appear not so special. Why is it that the Japanese stock market can have a good day in all this terrible mid-east stuff that's drowning the North-American markets? Are the Japanese not affected by goings on in the middle-east, or do we merely need to find an excuse for a failing market?
How hard will it be for Alan Greenspan to swallow his tongue and admit to the public, 'oops we were wrong, we're not in recovery mode after all,.. teeheeheee. Hope you can forgive us for dipping into your civil servant retirement funds, and driving us deeper into the abyss.'
What happens to all of those poor souls who spend money on government bonds and hope to see thier money in thirty years,.. and oops, we spent that too, didn't we tell you?... Sorry.
This whole speil is like me and credit. I used to make more when there was more work, so I don't mind using a little credit, cause I know I'll make more when it gets busy again, and I can maintain my luxurious lifestyle and pay for it next year,.. or the year after,... or the year after. Soon my credit company says hmmmm,.. we've been looking at you're income lately and we feel you owe too much, so we're going to stop allowing you to utilize your credit for awhile. Sound familiar? Congress,... raise debt ceiling?? What can I do as an individual? Go to the bank and take out the money I was earning interest on and repay my creditors. If necessary, I could dip into my retirement savings. Government? Same Same. Or should we say Shame Shame. The only difference between individuals and government, is that individuals must come clean in one lifetime, governments screw up many lifetimes.
Where do we go for more money after depleting retirement savings? More Debt? Who's going to vote for you next time?

If you read anything in this post, read this line first and you'll understand everything above - - - Blah Blah Blah

Sometimes I just write.

RobotGuy.

Thanks ......(FOA & Another still "MIA" & Missed!)It's very nice to be back among the friendlies....YGM

Missing FOA alot tho! Actually hoped to see some comments by old friend Another by this time. They must both be very busy because any slights given them by obnoxious posters in the past are long forgotten along with the posters who spoke them.....C'mon back gentlemen and share your thoughts again......

http://www.consensus-inc.com/newsletter/feature.htm

uponroof -- my thoughts exactly! only possible "why" is: because they're already insolvent at certain higher prices, so might as well defend it, play for time, and hope for a miracle. I guess we'll find out some day.

RobotGuy -- that's what I always wonder when I hear those "traders were concerned about blah blah today" -- does anyone actually go around and ask the guys putting in sell orders what they're thinking. No! You know that doesn't happen. No one calls the investors with a daily opinion survey (I don't know why not, if they really wanted to lend credibility to these blatant fabrications.) No, some reporter knows all he has to do is pick something else off the wire and put it together with the market direction and a boilerplate paragraph and get his hourly blah-blah filed. I mean, how wrong am I here?

R Powell -- Methinks our friend GR2 has a little shack in Hadley down 'tween the river and the potato fields, and grows his own favorite 'baccy nearby. Ever do the canoe trip?

It appears to me that there are many wealthy people in the Middle East who are divesting themselves of US stocks and putting their wealth somewhere else. I say this because I want any of you that are in the stock market to think seriously about this. I don't think the market is going up any time soon. I don't know about gold mining companies, but I personally think it is much better to have the physical in hand anyway. I never have understood how someone who wants truth and justice in the markets could play the paper game anyway. The way derivatives work, if everyone just played with paper, it wouldn't matter how much gold was out there. It only has an effect on price if people actually buy the metal. No matter how much a gold mining stock goes up, it is completely irrelavent if someone is not actually buying gold. Think about it, what if all these folks who think they have so much more leverage with gold stocks never bought gold itself. Gold stocks will only hold higher levels if someone is actually buying gold.
Now I am not giving investment advice, because I am not a professional, and it may be that there is quite a bit of selling of stocks because it is almost April 15 and people need the money to pay their taxes like a couple of years ago, but I believe that the USA is on the worlds sh#tlist these days, and in my opinion rightly so. We all know the dollar is overpriced, accounting is a lie, etc. It may be that the Middle East war is giving a lot of people the push they have needed to reevaluate where they are invested.
Just my humble opinion

Dow Jones Newswire

Tokyo April 3 After breaking through the key $305anounces resistance level overnight in New York, gold could shoot for $325 and then $350m said John H. Mesrobian, president of Virginia based Constantinople Advisors.

"Many hedgers, bullion banks and shorts are exposed to gold breaking above $305. Gold taking out this level will put these bullion banks and hedgers in a panic, for their positions will be under water. In the end these shorts will have to cover and they will cause some spikes along the way", he told Dow Jones newswire in a recent interview.

Mesrobian said Constantinople Advisors, which advises corporate and individual investors on currencies, sovereign bonds, gold and other commodities, has issued a "multiple spike alert" for the gold market.

"Gold could see a $25 to $50 move at any time in these unstable political times. We have problems in the Middle East, Afghanistan, Pakistan and other places," he said.

Mesrobian is also predicting a further rise in oil prices, which could help gold as these two commodities have historically moved in step

"We expect to push through $30 or $32 a barrel based on the current state of the markets and other conditions. We would add that if there is a war or if (Yassaar) Arafat is killed, then oil prices will shoot much higher, even past the $40 mark," he said.

Mesrobian sees a strong appetite for bullion in the Asian region, especially among Japanese investors.

"As the yen continues to weaken you will see the Japanese buying more gold. Watch the Y147.50 area. If the yen breaches this level it will drop a lot more, and then watch the gold market," he said.

"We were told over a year ago by a well known Japanese investor that the Japanese will give up on both the yen and the dollar at some point and start buying more gold. This move will be slow at first and then speed up." Mesrobian said.


Siochain...What we are seeing now is one of those spikes ...though down...as TPTB seek to get above water...gasping...it should be quite a battle for a little longer...though the war has been won IMO...it's just a matter of time and circumstance

Thank-you Mr. Gresham, you said exactly what I was trying to say.

Hipplebeck, I do own gold, and my measly purchase of a little more isn't going to inspire the POG, but I do also own gold stocks. What you are saying is very legitimate, and those types of thougts go through my mind every day when I look at my portfolio and think about withdrawing my money and dumping it all into physical gold. There are a few things however in the back of my mind that keep telling me that if and when there is a real run-up, people won't be able to buy physical fast enough. Once everyone who is a long term investor has accumulated the world supply, we must rely on newfound sources ie. mining companies. Most people who purchase gold will look at historical prices and determine when they will sell for a quick buck, and that will cause the market to roll for quite some time, but eventually those who want to keep it for stability will get a hold of it and we're going to have to start looking at mother earth for what's left. That my friend is precisely why I continue to hold stocks in mining companies with little or no obligations or debts, and proven in ground resources,.. even gold exploration companies. Don't get me wrong, a fast buck is very appealing, but I'm starting slowly to get it through my thick head that a fast buck is much harder to find now more than ever. In my opinion the most important thing for the benefit of gold or any PM is that it gets divided into many hands and I think we're seeing that these days alas.

http://www.msnbc.com/news/733409.asp?cp1=1

Investigation of irregularities targets some of largest U.S. firms

Snippit:

April 3 � The Securities and Exchange Commission is looking into accounting methods at some of the nation's largest companies, broadening the scope of its inquiry beyond the accounting issues raised by the collapse of Enron Corp. to include a laundry list of other potential accounting abuses.

Black Blade: The "toothless tiger" � the SEC appears to have found some courage and is finally doing its job investigating accounting irregularities. We may see several Enrons come to light.

http://www.latimes.com/business/la-000023704apr03.story?coll=la%2Dheadlines%2Dbusiness
Snippit:


A bill to force companies to treat employee stock options as an expense faces opposition in House and Senate tax committees, and from a countermeasure offered by a Senate committee chairman.

House Ways and Means Chairman William M. Thomas, a Bakersfield Republican who oversees tax legislation, opposes a bill sponsored by Michigan Democrat Sen. Carl Levin and Arizona Republican Sen. John McCain that would force firms to report options as corporate expenses and deduct them from income. So does Thomas' counterpart in the Senate, Finance Committee Chairman Max Baucus of Montana.


Black Blade: There are many Senators and Congressmen who oppose ethics and honesty � gee, go figure. Just another sign of the times.

http://abcnews.go.com/wire/World/ap20020403_1000.htmlArticle:

NABLUS, West Bank April 3 � Saddam Hussein has increased money for the relatives of suicide bombers from $10,000 to $25,000, drawing sharp criticism from Washington. But Palestinians say the bombers are driven by a priceless thirst for revenge, religious zeal and dreams of glory not greed.

Since Iraq upped its payments last month, 12 suicide bombers have successfully struck inside Israel, including one man who killed 25 Israelis, many of them elderly, as they sat down to a meal at a hotel to celebrate the Jewish holiday of Passover. The families of three suicide bombers said they have recently received payments of $25,000.

The devout Muslims among the bombers, a majority, believe they will go to heaven as martyrs and spend eternity in the company of 72 virgins. In grainy farewell home videos, they often read passages from the Muslim holy book, the Quran, and praise God. Secular attackers know that after the deed, their families will win the adulation of friends, neighbors and strangers.

The other motive seems to be a strong yearning for revenge. Relatives of many of the bombers recall how many of the young men's formative years were spent in Israeli jails. The mother of one bomber said her son once watched Israeli soldiers beating his father.

Mahmoud Safi, leader of a pro-Iraqi Palestinian group, the Arab Liberation Front, acknowledged that the support payments for relatives make it easier for some potential bombers to make up their minds. "Some people stop me on the street, saying if you increase the payment to $50,000 I'll do it immediately," Safi said. He also suggested such remarks were made mostly in jest.

Saddam has said the Palestinians need weapons and money instead of peace proposals and has provided payments throughout a year and a half of Israeli-Palestinian battles. "I saw on Iraqi TV President Saddam saying he will continue supporting the (uprising) even if it means selling his own clothes," said Safi.

Defense Secretary Donald Rumsfeld said Saddam's payments inspire a "culture of political murder."

"Here is an individual who is the head of a country, Iraq, who has proudly, publicly made a decision to go out and actively promote and finance human sacrifice for families that will have their youngsters kill innocent men, women and children," Rumsfeld said Wednesday.

But Saddam is not the only one giving money. Charities from Saudi Arabia and Qatar both U.S. allies pay money to families of Palestinians killed in the fighting, including suicide bombers.

The mother of Jamal Nasser, a 23-year-old architecture student who died trying to ram an explosives-laden car into a bus carrying Jewish settlers, said she received a check for $10,000 from Iraq and another for $5,000 from Saudi Arabia. She said she plans to put the money toward buying an apartment. She wants to move her family from the small place they've been renting for more than 20 years. The money she received is about half the cost of a small apartment in Nablus.

Fifty-five Palestinians have blown themselves up in attacks on Israeli civilians in the past 18 months of fighting.

Under the new Iraqi payscale, decided on March 12 during an Arab conference in Baghdad, the families of gunmen and others who die fighting the Israelis will still receive $10,000, while the relatives of suicide bombers will get $25,000.

Safi and two others from the Arab Liberation Front visit families in the northern West Bank and make the payments. "We go to every family and give them a check," he said. "We tell them that this is a gift from President Saddam and Iraq."

###########################################################

RobotGuy; Well, I think that might be an indication of support for terrorism. I wonder if the payments are upped if the attacks take place in the 'western world'?

http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=29022173&ID=cnniw≻ategory=Metals+%26+Minerals%3APrecious&
Snippit:

Gold's return as an investment choice has been spurred by the announcements by several large mining companies that they will reduce their hedge positions. Potential investors were pleased to hear that.

Black Blade: It makes no sense to sell forward with interest bearing investments falling flat. Also, the outlook for Gold is quite positive. World events are also positive for Gold and Energy.

Warfare in Palestine is intensifying with reports of fierce gun battles in Jenin and tanks starting to move into Nablus. Today Egypt cut off diplomatic relations with Israel. Sharon and one of his generals were overheard on an open mike discussing how they should assassinate of one of Arafats advisors. There exists the possibility that Israeli tanks may level Christian shrines in Bethlehem to get Palestinian gunmen. This mess is getting out of hand.

From the cafe:
The Morgans Orchestrate Gold Sell-Off Right On Cue

The John Brimelow Report:

Indian premiums: AM $1.54, PM $ $1.19, with world gold at $305.10 and $304.90. Below legal import levels.

Today has proven quite a triumph for the predictive qualities of both the gold shares, which sold off ominously yesterday afternoon, and for MarketVane's Bullish Consensus, which finally showed exuberance, jumping last night 3 points to a dangerous 77%. Actually, Tocom gold opened firm and pushed gold up to $307 - 70 cents short of February's high. But once the active contract reached 1300 yen, a popular trading objective, a reaction set in. This was exacerbated by a marked strengthening in the yen, and by the appearance of "US bank selling" (UBS Warburg) which has continued this morning. Volume was 34,200 Comex equivalent, moderate by recent standards, and open interest fell by only 79,600 ozs, which does not suggest a major liquidation is underway.

Short term, Tocom buying is extremely yen sensitive, and a wave of complacency about the currency is on the move. However, a currency experiencing 34% monetary base growth is not going up long.

JB

As John pointed out via the UBS Warburg comment, it was US bank selling that capped the gold rally in Japan. It was as active a gold market in Japan last night as I can recall. Gold was on the move and then The Gold Cartel showed up to do their thing again.

These crooks are most predicable and most irritating. They do get an "A" though for consistency.

Late yesterday I learned that Morgan Stanley went around during the day telling the hedge funds that the gold move was over for the time being. That is what halted the gold share move higher. Today it was JP Morgan Chase and Goldman Sachs taking gold down on the Comex - one big happy family, the New York bullion bankers.

Of note is that Morgan Stanley has been much more visible on Comex in recent weeks compared to year's past. Over those years I have pointed out that Morgan Stanley was one of the silent cabal members. My sources tell me they have been all over the gold and silver action lately, but have here-to-fore been low-key about it.

At this time I think it might be a good idea to point out that the criminals in these firms are only a few in number and they are the very senior people. All of these corporations employ many superb people, a few are even Caf� members - ones interested in the financial truth like the rest of us.

Silver was stopped with gold at critical $4.75 resistance - perfect timing by the market manipulation crew.

Every day the financial news and related commentary gets more gold/silver bullish and more stock market bearish:

New York, April 3 (Bloomberg) -- U.S. Treasuries fell on concern inflation will accelerate as the economy rebounds from recession, dimming the allure of fixed-rate investments.

Federal Reserve Bank of Kansas City President Thomas Hoenig last night said the economy is growing faster than expected, bolstering expectations the central bank will raise interest rate by midyear to curb faster inflation.

``With the funds rate at a 40-year low, and one Fed official saying there will be inflation down the road, that suggests the Fed is going to raise rates,'' said George Adell, director of fixed-income research at Philadelphia-based Starboard Capital Markets. He expects the Fed to boost its rate target as much as 1.25 percentage points to 3 percent by the end of the year.

From cafe
From savvy Jim Puplava

Bill,
There was unusual activity in the gold share markets today. As the price of oil, natural gas, gold and silver moved up so did share prices. Then during the final hour of trading an unusual pattern developed. Gold and silver bullion prices rose while share prices fell. I watched daily money flows on several key stocks. The big ones first. Then there appeared to be a big sell-off in all the major shares. This seemed unusual in that the metals price was rising. Oil and natural gas, and oil service shares rose along with defense stocks which we own. The only unusual pattern was in the metals shares. They may now become the new target for the cabal. The momentum crowd would not have been selling on a day like this. So somebody(just guessing) triggered the sell-off which got picked up by the radar screens of day traders. Then stocks sold off.

With all of the publicity that gold and silver shares have been getting lately the last thing they want is for John Q. Public to start buying gold and silver mining shares. I own 4 percent of a junior mining company and will take that interest higher in the next week. I know that when the shares hit $1.50 my market maker told me that Charles Schwab sold the shares short. Now those shares are over $2. Today my market maker was telling me Schwab was shorting the stock. This company is owned by very strong hands. All of us who own it are long-term holders of the shares. So I don't know where Schwab is going to get the shares to cover their position. The shares are thinly traded on the Toronto and on the Nasdaq. They are going to get squeezed. The last block I bought was from a hedge fund that had gotten itself in trouble. They were trying to sell the only thing they had that was up which was their mining shares. This is how I'm picking up my next block position.

Anyway I thought I would just mention today's action in the precious metals shares because it was so unusual. It didn't add up. There was no sector rotation taking place that would have caused the momentum crowd to exit their shares. I think the cabal is looking at the precious metals stocks as well. It is tough to explain many of the juniors stocks are up over 100 percent since January. The HUI is up over 47 percent YTD and up close to 100 % over the last 52 weeks. Gold shares were the best performing sector last year and the best performing sector during the first quarter. This should be front page news everyday but it isn't outside CBS's Tom Calandra.

All The Best
Jim Puplava

I said exactly the same thing yesterday.

After so many years in this, one develops a sort of intuition about these matters. Sometimes it is wrong, of course.

The price of gold - actually, the price of the dollar in gold would be a more correct expression - is in an established up-trend. This is not going to be changed by manipulation. The bullion banks are fighting a rear-guard action, in retreat - the hardest of military exercises, by the way.

"They're on the run, boys!"

Sierra

http://www.newmont.com/inv_relations/newsreleases.htmI read the post here about a week ago concerning the slope collapse at the Betze Mine. What was puzzling about it was the reference to the Deep Post Mine in a context that suggested it belonged to Barrick. I seemed to remember that mine as being owned by Newmont, so I just did a little checking on Newmont's web site. For what it's worth you can read the Newmont side of the story, (link above). At any rate, it doesn't sound as if there is any problem with production at the Deep Post Mine. Sounds like a misunderstanding to me?

Click on "general", then look for the articles;

9/5/2001 Newmont's Deep Post Mine Reopened
8/29/2001 Slope Movement Occurs at Nevada Mine

I did not realize that the Deep Post deposit was on the Newmont part of the property. Thank you for the information.

http://member.usagold.com/commentaryreview.htmlSomething interesting is going on in the overall gold derivatives' positions. The top three U.S. gold bullion banks' positions fell from $73.2 billion in Dec00 to $48.9 billion in Dec01 reflecting the overall reduction in the gold carry trade positions over the course of 2001. John Doody (Gold Stock Analyst) says "recent CB efforts, overt and covert, are designed to keep a short-term lid on gold's price, effectively 'holding the door open' for the commercial banks to get positions squared, or get out all together. If one of these major banks was to require rescue by the Fed or the German or UK Central Bank, it would be far more damaging to world economies, and the rescue more costly, than to keep a lid on gold and allow the big commercial banks get out with survivable losses."

Taking a closer look at the Gold Derivatives Table published at the News & Views page (linked above), one can see that most of the reduction has occurred at J.P. Morgan which went from $30.5 billion 12/00 to $7.3 billion 12/01. I find this very interesting. That makes two out of the big three American gold derivatives' players showing a reduction to the $7 billion level.

Is it now Chase's turn in 2002 to move to the $7 billion level?

I think Doody's right. There holding the door open with derivatives in order to exit their carry trade positions or get the losses to a manageable level -- a workout as we have described many times before. And Chase may be the last to squeak through before the gold demand slams it shut.

This is the best evidence available why gold might be ready to explode. It's like holding a spring with your foot -- when you let go you'd better get out of the way.

Everywhere you look in gold's numbers -- derivatives, the LBMA, etc -- the numbers are telling us that the gold carry trade and mine lending are being unwound.

This is one of the most solid indicators I've seen in a long while why the knights and ladies at this Table might take heart - - Nay, not just take heart, but tip their flagons in celebration.

The battle is being carried, the war won.

http://www.busrep.co.za/html/busrep/br_frame_decider.php?click_id=345&art_id=ct20020403185945762N243665&set_id=60(Reuters April 04 2002)
London - Gold markets shadowed their strongest level in two months yesterday as Israel widened its assault in the West Bank and traders predicted further price gains.

Gold is just shy of its firmest level in two years, when it touched $309 in spot markets on February 17 2000.

"While tensions remain elevated in the Middle East and the lack of selling continues, gold looks set to make fresh gains," said John Reade, metals analyst at UBS Warburg.
----------

Knowing what technical trade can do to a market once it nudges past long term resistance, you'll want to establish your position in metal. When push comes to shove and liquidity tightness precipitates a whole new ballgame, you will be glad you were proactive rather than reactive.

R.

http://www.forbes.com/work/managementtrends/newswire/2002/04/03/rtr558670.htmlHEADLINE: US Mint suspends production of dollar coins

By Jonathan Nicholson

WASHINGTON (Reuters) - Only a few years after their introduction, the U.S. Mint has suspended production of "golden" dollar coins for commercial use and said it will evaluate its need to produce them next year.

The move came to light with the recent release of a Treasury Inspector General's report that urged a production halt to save money.

"We are not currently producing circulating golden dollars," Mike White, spokesman for the U.S. Mint, said on Wednesday.

Rep. Michael Castle, the Delaware Republican who sponsored the legislation creating a new dollar coin, said the coin's problems are due to its lack of use commercially.

White also said the coin is finding acceptance for uses such as in vending machines and for urban subway systems, but the Mint knew it had a tough job when it introduced the coin.

"You know going in, it takes awhile to change people's habits," White said.
------------

Widespread public attention in America to such "revolutionary concepts" as prudent gold diversifaction can require a long trip down the runway before taking wing, skyward. It happened in Japan, it will happen here. There's nothing quite like the sinking feeling of being caught out of a good thing to motivate the next wave of buyers. Unlike stocks, new "shares" of gold metal can't be suddenly registered for distribution out of thin air to satisfy investor demand and to further allow the corporation to capitalize on the newfound interest.

Only gold in metal form has the beneficial qualities that have through the long ages been attributed to gold. Think about it...

R.

On a related note, thanks to the person(s) who recently posted about Louis Rukeyser being canned by WSW/MPT. The show really had become a bit of joke from a journalistic perspective. I must admit though, I did watch it from time to time. But mainly as a substitute for the funny pages. I figured that if the "elves" or whatever they were called should ever turn bearish, it might be a sign that the stock market was finally bottoming.

Anyhow, I tuned in last friday based on the news here that LR had been given the boot. The show was hosted by Marshall Loeb (sp?) and one of the guests was none other that Jim Grant, the king of the "Bond Vigilantes". I don't remember his exact words, but his comments on the markets went something like; "Unlike some people, I don't have much confidence in the central banks. I'm very bullish on Gold, which is much like the opposite of the central banks." I had known long ago that Jim was bullish on Gold, but it was sure nice to see it said on WSW without some security guards appearing on camera to take him away. (Given that LR always went out of his way to ridicule Gold on virtually every show, I'll bet he was enraged by that if he was watching).

In what little "mainstream" press that I follow, I have noticed that Gold has been mentioned more and more lately, and sometimes with a positive tone. My take is that this is NOT a coincidence. It suggests (to me) that a big move in gold is coming and the only question is when? Many people who own(ed) stocks feel betrayed by Wall Street for having been mauled by Mr. Bear when they were told to just close their eyes and hold on. For a megabull market in Gold to appear without ANY warning at all from the GE Capital Channel and the rest of the puppet press would only add to the growing distrust of Wall Street. Just my 0.02/35 oz of gold...

Your Post....USAGOLD (04/03/02; 16:34:36MT - usagold.com msg#: 72645)
Black Blade, Siochain. . . .ALL
http://member.usagold.com/commentaryreview.html

---Is the best news yet. Proves the rats are abandoning ship. This is the most concrete evidence yet that "THIS TIME IT'S DIFFERENT"...Thanks much...YGM.

That was a USA Gold Post...But love those BB Posts nontheless :0)

MK � Thank you for that information on the Gold derivatives positions held by these banks. That certainly is a Bullish signal. I haven't checked for a while, though I believe that total derivatives positions for these banks were a staggering $47 Trillion (with JP Morgan Chase holding the lion's share � roughly $29 Trillion). I would wonder if they are trying to extricate themselves from those positions as well. If not, then we would know that they feel extremely vulnerable with these Gold derivatives � an extremely Bullish signal.

Siochain � I think that Jim Puplava may be on to something. After several years of keeping a cap on Gold prices, institutions may be looking for a new means to keep Gold prices under control. Most unhedged miners are held closely so short sales of these mining shares may be short lived, however, the price of larger mega-hedger shares may feel the pain as investors in those shares are not as passionate about Gold as a store of value or as an alternative currency.

Recent large scale selling of US government paper and the sell off on Wall Street can be partly attributed to Japanese institutions and investors selling. There is circumstantial evidence that this cash is being repatriated for propping up domestic markets and paying off debt. For years Japanese investors has kept cash in US based investments as interest rates fell to zero and domestic markets crumbled. Now much of that cash parked in US investments may be coming home. The result is that the withdrawal of this foreign investment and lack of fresh investing from domestic sources has caused the US markets to pull back. Also, a daily listing of earnings warnings, restated earnings, accounting scandals and numerous new SEC probes appear to have cooled the urge to invest.

- Black Blade

Even with the down day in both mining stocks and metals' prices, gold still received more bubblevision attention again today- charts included.
Why do I now have the feeling that down days like today are just the normal down days that every bull market contains. I even took advantage of silver's 8 cent decline, a trick I learned from the 1990's, buy the dips!
From today's IBD, open interest numbers
Gold 150,180 +3,200
Silver 78,356 +931
I view increasing open interest in a price rising market as a sign of strength. I expect to see some decline in these numbers tomorrow after today's decline but this is to be expected now and then, no?
Now that the March 27-31 time has passed, I guess we can say Arch Crawford correctly called the SM downturn but I guess we should say his "market meltdown" prediction was a little overstated. Interesting also was commentary today by the CNBC regulars that volume was very light and the market down due to a noticeable lack of buyers rather than excessive selling. This reminds me of similar comments used to describe "market meltdowns", like 1929 when "there were no buyers!" The CNBC analysts were also concerned that they could not identify any sector rotation. There was no noticeable buying anywhere. Stocks, bonds and commodities were all down. Where did the money go?? Something is not right seemed to be the unspoken thought.
Interesting times.
Rich

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=140117

Snippit:

HOUSTON, Apr. 3 -- US natural gas production is on the decline, and the decline is accelerating rapidly, according to preliminary results of a Raymond James & Associates Inc. first quarter survey of 30 of the largest US natural gas producers. Supply is declining much faster than most analysts expected, Andrews said. US gas production trends generally lag the rig count by 3-6 months, but last year, US gas production began showing declines before drilling activity peaked in July.

Producers were drilling wells that they could bring on production quickly at high flow rates. With activity on these types of prospects now halted, production from high-flow-projects likely will be down by 30-40% this year, he projected. "As a result, sequential production declines should continue to gain momentum as the year progresses, and we continue to believe that US natural gas production could be down by as much as 5-6% this summer on a year-over-year basis," Andrews said.


Black Blade: as I have been reporting here for the last several months. It should also be noted that withdrawal rates have more than doubled over last year's rates. This situation may become more critical as the drought on the east coast and other regions deprives hydroelectric facilities of needed water flows. Also, recent boric acid corrosion in nuclear reactors will require extended maintenance and shutdown. Pending legislation on clean-air proposals and a lack of new carbon credits may restrict coal-fired power production. The higher costs of oil and natural gas will sink straight to the bottom line. In short � scratch one US economic recovery for 2002-2003.

Every once in awhile I go to various bookmarks and see what's happening in the internet world. Tonight's journey revealed USAGOLD posters appearing as quotable items (and in some cases highly visible) at various websites. Here is where the foundational thinking is being done and subsequently quoted elsewhere. This is not intended as a swipe at anyone else. . . long may all the gold web sites live in cyberspace, but it is here where the ground is being broken -- THE LEADERSHIP PROVIDED.

My thanks to all the top-notch who have decided to make this place their place -- the knights and ladies of this Table Round. It does us proud to see so many of you quoted at so many different places nearly every day.

God bless you, all of you.

And let me at the same time invite anyone -- no matter where you post now -- to come here and help us move the cause forward.
You'll find the welcome mat rolled out -- you'll find a place where you'll be read.

Here's a thought Rich...apparently the Arabs have approximately $2.4 trillion expatriated dollars. Every day the ME mess escalates and the probability of regional full scale war grows greater, as does justification for a US invasion of Iraq. One could debate the political pros and cons and probability of these issues, but the point is this...fear. And we know fear and confidence drive the markets. Now...if I were an Arab...particularly if I were a scared Arab...scared of what Saddam might do...scared of what the US might do...scared of the implications of regional escalation...would I be leaving my fiat in the USA, or would I be repatriating my money? I know what I'd do...hence no sector rotation today?

Trading volume was about 1.2 billion shares on the DOW, and about 1.7 billion on the Nasdaq...hmmm..light trading they say? Interesting times indeed! Cheers,

Waverider

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

A Crisis of Confidence

Snippit:

There are many famous quotes that describe today's economic and financial environment. Perhaps you have heard of many of them. The obvious one is "Figures lie and liars figure." Winston Churchill once said, "There are a terrible lot of lies going around the world, and the worst of it is half of them are true." There is even a book out by there called, How to Lie With Statistics by Darrell Huff. Unfortunately, we live at a time when numbers, facts, and statistics can no longer be taken at face value, especially today when looking at economic and financial numbers. It doesn't matter whether you are looking at economic or earnings reports coming from corporations and Wall Street analysts. A crisis of confidence or a lack of trust in our government and financial institutions is the number one crisis now facing the financial markets.

Unemployment

Snippit:

Another example of this malarkey is the way the unemployment numbers are reported. Last month the government reported the unemployment rate fell in February from 5.6% in January to 5.5% in February. Those numbers are seasonally adjusted (manipulated). This number surprised the financial markets helping to trigger a rally in stocks as another sign the economy was improving. This lower unemployment report stood in stark contrast to daily headlines of continual job cuts being announced by major corporations. The actual numbers unadjusted portrayed a different picture.


Black Blade: Amen Brother!!! As I have been pounding on these points for some time. Also not that Jim Puplava tackles the obscene options issue that is defended by unethical deceptive politicians such as Sen. Lieberman (D-CT). And the Trolls on CNBC are wondering why trading volume is so light these days. Hmmm...

This is a very good article that nails it! We do definitely live in "Interesting Times".

Michael

I rarely post, but have followed this site for years. Over the years there have been a number of posters whose contributions I have greatly valued. Because of such contributors I feel my knowledge and understanding of Gold and how it relates to the financial markets has been enhanced. I am appreciative of their efforts. While you have many great posters at this site currently, a number of the great posters of the past seem to have disappeared. Some days I feel like Black Blade is holding back the villains that would storm the Castle single handedly. He is very capable but your post (#72654) where you throw out an invitation to new knights and Ladies of the Round Table, got me to wondering whatever happened to some of the very strong contributors of past years. Do they no longer visit the site? Did they give up on this ongoing battle over gold? Or are they still around and just tired of posting?

I suggest you call a reunion or do a roll call to see if you can get some of those great posters of the past to give us an accounting of their wellbeing and current thoughts on gold.

I know it is a mistake to try to name them because many valuable contributors will be overlooked. However I will name just a few that come to mind anyway:

ORO
Aristotle
Aragorn III
The Stranger
Steve H
Gandalf the White
Peter Asher
Holtzman
Al Fulchino
And of course FOA or Trail Guide

You might nominate a committee just like they do for high school reunions in an attempt to find those not accounted for.

Just a thought

http://www2.swissinfo.org/sen/Swissinfo.html?siteSect=105&sid=1092045Snippit:
"The Swiss franc has risen, oil prices have strengthened and gold has climbed to its highest level in two months as violence in the Middle East continues.

Clearly, the Swiss franc has risen sharply against the euro and the US dollar in the last few days," said Hans-Peter Hausheer, a senior economist at UBS.

It's part of a historic trend, whereby gold and the Swiss franc are always considered to be safe havens by investors when there are world events that threaten to involve the US or the European Union," he added.

Waverider: Yup...if I lived in the ME I know where I would place my $$$$...

http://www.wn.com/?action=display&article=12838882&template=gas/indexsearch.txt∈dex=recent
Snippit:

BETHLEHEM, West Bank (AP) � Israeli tanks rolled into the West Bank's largest city, Nablus, on Wednesday and other troops laid siege to a refugee camp in Jenin, battling Palestinians who barricaded entrances and fought back with bombs and guns. Soldiers also encircled hundreds of Palestinian gunmen holed up in the church marking Jesus' birthplace.


Black Blade: There are reports of heavy fighting tonight in Nablus and Jenin. However, it appears that the suicide bombings have ceased (for now). Protests against the US outside embassies in Lebanon, Jordan, and Egypt have erupted into violence. Saddam Hussein has increased payouts to families of suicide bombers from $10,000 to $25,000. Also, Israeli anti-war protesters are in combat with Israeli police and many Israeli reservists are refusing to appear for duty and instead going to Israeli military prison (some have signed a petition protesting the war). This war in the Middle East is likely to spread and get much worse.

Oil Embargo?

Iraq and Iran both have said they may consider an Oil Embargo. That could remove as much as 6.5 million bbl/day from the world market demand of 77 million bbl/day. That is far more than the 1.5 million bbl/day production cuts agreed to by OPEC and Non-OPEC. Even so, Saudi is the only producer capable of increasing production (about 2 to 4 million bbl/day) above pre-agreement levels.

Your previous Post....JA (04/03/02; 21:12:14MT - usagold.com msg#: 72657)
Call for return of posters of past years

FWIW... Your suggestion and thoughts are (I am sure) shared by many here. There have been so many profound & articulate posters pass thru these halls it is somewhat sad to not have the sharing of their thoughts. I have learned much here and shared a little, but what great discourse we've been privy to! If I may "I Second" your motion....YGM.

http://www.cheniere.org/correspondence/index.htmlMy apologies for another off topic post but thru the reading of Tom Bearden's correspondence letters one 'May' see the reality of holding some physical Gold in an ever changing and uncertain world........YGM

Footnote: Toms site contains knowledge and information most of the populace will disbelieve or choose to ignore. But be forewarned he can and does have the proofs of his statements by and large. If you said you could send pictures thru the airwaves 60 years ago you would have had few followers. An open mind has always been the key to new knowledge! We all know knowledge is the greatest wealth and weapon for survival.

http://globalarchive.ft.com/globalarchive/article.html?id=020404001562&query=gold
PRECIOUS METALS HOUSEHOLDS ARE STOCKING UP IN THE FACE OF ECONOMIC TENSIONS:

Snippit:

Concern about the Japanese economy, the state of the country's banks and now unease about tensions in the Middle East are continuing to send the Japanese public to their nearest gold shop to stock up on the precious metal. "It is certainly possible that a rise in demand for gold bars in Japan raised the international price of gold in February," said Masaaki Kanno, economist At JP Morgan. "The estimated purchase of gold in January and February is only 0.2 per cent of annual savings by the household sector. This implies that the impact of a change in Japanese householders' investment can be so big that it could affect the global market prices of financial assets."

But talk of a "March crisis" saw many Japanese shift their money from bank deposit accounts into gold and other assets. Gold sales were also spurred by the government's decision to lift the guarantee on bank time- deposits of more than Y10m from April 1. Although that deadline has now passed, the guarantee will be lifted from other types of bank accounts in April next year, leaving Japanese savers still fearful for their life savings. The Financial Services Agency's report on its special inspection of the banks' non-performing loans, due out this month, is likely to deepen concern about the banks.


Black Blade: Gold sales should continue to beat last years pace due to the next "April Fools Day Surprise" where deposit guarantees are rescinded for all savings deposits. Considering that there is a lot of cash sitting in insolvent Japanese banks that will seek safety before next April, we could see a lot of physical buying. Imports of Gold should increase steadily as April 2003 approaches.

http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?story_id=29040017&ID=cnniw≻ategory=Metals+%26+Minerals%3APrecious&
Snippit:

However, gold has to become more than just an icon of gold bugs, conspiracy theorists and short-term speculators. Instead it needs to broaden its appeal as an asset among mainstream investors anxious to protect themselves in an increasingly uncertain financial and political environment.

Black Blade: It looks like time for a mainstream ad campaign. So where's the WGC now that the POG has made some progress? Hmmm�

Greetings YGM,

thank you for the link - it is brilliant. I suspect that the theories and practical applications of Tesla and others like Tom Bearden would be kept quiet (if possible) by the powers that be for reasons of weilding power over the masses and for military purposes rather than improving the conditions that everyone on this planet live by.

You are right in stating that this information would not be believed by the average person - how can it be when most academics are ignorant of it and denounce what they fail to comprehend.

Ah, the power of the internet...

Cheers.

Hello everyone,

About an hour ago there was a clown from Barclays on CNBC Europe stating that the manipulation of the gold market story has no merit (geez, someone conveniently chose to ignore Reg Howe's evidence and the Judge's conclusions). I only caught the last phrase of the interviewer reiterating the clown's view, but missed the bulk of the argument as put forward by him.

Did anyone catch this?

Interesting that the story is being discussed now after the ruling by the Judge - attempts to discredit the whole case? - another attempt by the cabal to divert the attention of the masses...

Cheers.

http://globalarchive.ft.com/globalarchive/article.html?id=020402001514&query=precious+metals

Snippit:

BEIJING : China issued its first batch of silver export quotas for 2002 totalling 1,260 tonnes, higher than the full amount for 2001 due to a recovery of global prices and weak domestic demand, an industry official said on Monday. China, the second largest producer behind Mexico and a major global exporter of the precious metal, issued three batches of silver quotas last year amounting to 1,180 tonnes, traders said. "This is just the first batch and we expect the government to issue more if world silver prices remain at current bullish levels," said the official.

Black Blade: "Interesting"

http://www.msnbc.com/news/732411.asp?cp1=1

Reserve provides less import protection than it did in �85

Snippit:

April 2 � As oil prices soar above $27 a barrel for the first time in six months and Saddam Hussein calls on Arab states to use oil as a weapon to punish countries supporting Israel, America's insurance policy against an import cutoff stands at less than half of what it was in 1985. The 560 million barrels in the Strategic Petroleum Reserve are enough to replace about 53 days of imports. Seventeen years ago, the reserve afforded a 118-day cushion. "WE HAVE LOST substantial ground. Our level of import protection has declined dramatically," said Larry Goldstein, a veteran analyst with the Petroleum Industry Research Foundation, a New York think tank.


Black Blade: Note that Bill Clinton authorized a draw down of the SPR during the last "Energy Crisis" in a failed bid to secure the presidential election for Al Gore. That oil also has not been returned. As a result the security of the nation was put in jeopardy for the sake of politics. Oil prices current hover around $27.50/bbl and Natural Gas is higher at $3.55 Mbtu.

We await your words of wisdom Sir.

http://www.investavenue.com/article.html?ID=4631
What matters is the Fed's rationale for the campaign and how it sells that rationale to the markets. By Paul A Mc Culley from Pimco.

A question for you Sir.

I hold a sizeable chunk of change in an energy trust that literally fell off a cliff yesterday.

Why the sudden reversal yesterday? Oil & gas have made the same sudden spin-around as PM's.

What do you make of this? Are traders looking at a de-escalation in the ME? The non-rebound in the economy? Both? Neither?

This is really confusing.

HELP!!!

TIA

The judge said Mr. Howe did not have standing, but that others; gold-mining companies and investors do. Personally, I have lost a lot of money on gold options sincethe manipulation began. Does this include you? How hard would it be to file a class action lawsuit? How much would a full page ad in the WSJ cost? Call it the NIGHT OF THE LIVING DEAD LAWSUIT; or JASON RETURNS-YOU CAN'T KEEP A GOOD LAWSUIT DOWN. I'll bet the WSJ would not print it. They would probably say we didn't have standing.

http://quote.bloomberg.com/fgcgi.cgi?ptitle=David%20DeRosa&touch=1&s1=derosa&tp=ad_topright_bbco&T=markets_fgcgi_content99.ht&s2=ad_right1_bbco&bt=ad_bottom_bbco&s=APKqMzhKvSXQncyBU
It's Time for U.S. to Withdraw From the IMF: David DeRosa

200 Palestinians hold out in reputed site of Christ's nativity



The bodies of Samaya Moussa Abda (64) and her son Khalid Yakoub Isa Abda (37) were locked as if in a final embrace, sprawled against a bloody sofa on the floor of their little shop in Bethlehem's old quarter. By Peter Beaumont, in Bethlehem and Michael Jansen, in Jerusalem.

The Israeli soldiers who came to their door on Monday had been shouting through the metal door for Samaya and Khalid to open up.

When they refused, the soldiers fired 18 bullets through the door, cutting down Samaya and her son, who had collapsed and died in the gloomy ground floor room.

Yesterday, as a tense stand-off continued in the nearby Manger Square, site of the Church of the Nativity built on the reputed birthplace of Jesus, a few hundred metres from the Abdas' little house Israeli soldiers continued to move through the streets from door to door.

We came across two columns of them, retreating ahead of us in the direction of Manger Square, firing shots into the doors that they had already blasted from their hinges as they went.

On every corner and every block the soldiers had smashed the water pipes and mains, destroyed cars and ripped up electricity cables.

Elsewhere we found other remnants of the continuing fighting: an armoured panel, ripped from an armoured personnel carrier that had run into a wall. Elsewhere, the drifts of spent shell casings from the Israeli soldiers' weapons.

We halted when the Israeli soldiers called to us to come no nearer to the square, where some 200 Palestinian armed militants were holed up in the Church of the Nativity.

Among those trapped inside the church, the Vatican confirmed yesterday, are 40 Franciscan monks and nuns, as well as 30 Greek Orthodox and Armenian monks.

Ms Mary Kelly, a nurse from Baltimore, West Cork, was among a group of volunteers who tried and failed to reach the church to treat 30 wounded. She is a friend of Ms Caoimhe Butterly, also from West Cork, who has been inside Mr Arafat's headquarters since last Friday night.

"I was moved to come out to support the Palestinian people," Ms Kelly asserted. "We are hoping the international community will halt this brutal aggression. Two ambulances have been crushed by Israeli tanks. The Holy Family Hospital is riddled with bullets, which also destroyed the statue of the Virgin on the roof of the church nearby. There are women inside giving birth, and 30 terrified children."

The aim is to get an ambulance manned by a doctor and a medic to the church to treat less serious cases and evacuate those who need hospital care. The Red Cross has not been able to get through.

(Guardian Service)

Why are energy shares falling while oil and natural gas prices are much higher? That's the big question. We just discussed something similar about Gold and Gold shares. I was watching a Brit analyst who asked the same question about oil. No one seems to know the answer. The only possibilities I can think of are 1) profit taking; and 2) more Enronitis. Williams (a pipeline and energy compny) is under investigation by the SEC for questionable accounting. Where have we heard that before?

Another blow to the sector came when an energy trust Eott Energy Partners Ltd. (EOT) declared that they were not going to make a first quarter distribution. Other than that Euro regulators declared that they have assurances from OPEC that the trading range for oil will remain between $25 and $28. Meanwhile Oil holds at about $27.50, and natural gas is higher by 5 cents at $3.55 Mbtu.

The outlook for energy is that we will have higher prices so this general trend may be temporary. At the same time the situation continues to deteriorate. The press got ahold of unflattering pictures of Israeli police and military beating peace demonstrators. Througot the Middle East there are Arab demonstrations around US embassies. It would not take much for outside terrorists to do something while attention is diverted. We definitely live in "Interesting Times". Cheers!

- Black Blade

You know, after the statement out of Hussein yesterday ( first, admission of paying suicide bombers and second, increasing pay from 10k to 25k) I cannot find any reasonable explaination why a flurry of bombs haven't leveled Iraq yet.

What is Arafat's condition? Every stinking news channel was riveted on him all Easter week-end telling us of each of his urinations and now nothing. I understand they (media) has been booted out but what is going on?

Israel has taken over, 100's on tanks mobilized in every town, Hussein waving MORE terrorist money around, admission that he is behind all this and GOLD, OIL & GAS falls off a cliff?

Why is this so MUCKED UP?

Present.

SteveH

ps. Thanks

I appreciate your message but I think (fear) we are missing
something. I went thru approximately 20 PM stocks, half-a-dozen energy trusts and another dozen O&G majors, they ALL simultaneously fell off a cliff at (more or less) the same time, an extreme, sudden, unexplainable reversal.

They can't all be accounting crooks, I appreciate that possibly they got painted with the same brush. Please notice that after Comex/Nymex closed on Tuesday (gold rising to approx. 305) the sell-off started between 2 and 3pm. The traders were telling us something (markets always lead, yes) and sure enough POG and shares dived yesterday.

Do you find it odd that the Nikkei is rising? Most markets are struggling post-Apr. 1 but the Nikkei is rising, why? Has the Japan crisis thing been glossed over?

Israel has taken over, the bombers have stopped. Is the ME situation de-escalating? In the eyes of the traders it sure is. Are they correct? This will determine short-term trading, will it not?

I mentioned a key statement from the Arab summit the other day. The Arabs said, "...an attack of Iraq is an attack of ALL the Arab world." Has the imminent attack of Iraq been traded off for Israel's peace?

A couple weeks ago a very long article in the Globe and Mail suggested that a deal was being struck under the table for Hussein and Sharron's 'head-in-a-basket'.

I believe the opposite may be occuring now. Iraq's peace has been traded for Israel's (temporary?) This, in my very humble opinion, will be confirmed by the non-attack of Iraq even after Husseins blatant terrorist statements yesterday.
After all, the US was warned, in no uncertain terms as a result of the summit. This is why the US is 'doing nothing'.

Thoughts.

Canuck.

It could be that the markets were spooked with all the accounting scandals hitting energy and energy related companies from Enron to Williams. With the current situation in the Middle East, who knows what will happen. As far as the Nikkei, there is some evidence that Japanee are calling cash home to Papa. In other words, other markets are suffering due to lack of investment and Japanese calling home cash from foriegn investments. Anyway, that is the speculation from some people. Today looks like it could be another wild ride on Wall Street as no one has a clear feel for the market. Who knows - could be fun. I have no fear though as I have made my preparations (have PMs and still in positive territory in my investments) and now it is all a game. Cheers!

- Black Blade

It may be possible that much of that repatrioted cash is finding its way into the Nikkei. Oh yeah, I should point out that the Japanese government pension fund has been propping up the Nikkei as well with strong buying on occasion.

IMO I think you hit the nail on the head when you said "profit taking." It would seem to me that after all these years of people slamming precious metals as a reliable investment, people who are easily influenced will tend to listen closely and of course follow like lemmings. If someone who has never supported the idea of investing in the realm of precious metals is suddenly impressioned to do so they might be rather nervous once climbing aboard, and they will probably likely be the ones who jump overboard as soon as there's a mild swell. I think we might see this for awhile, as there are a lot of people including many of my close friends who are still very comfortable bashing precious metals. I told a few of my very good friends a year and a half ago to take all of their investments out of techs and put them into gold and they all laughed at me. Today many of them are angry at me, or so it seems, cause they didn't listen to me. I have another close friend who is just completing a university course that will enable him to be a market analyst or 'cheerleader' as I prefer to call them. I had a good long discussion with him over the subject of precious metals being a wise long term investment in light of recent and past events including but not least the suppression of gold and silver. My good fiend has been taken by the masses of mainstream education and will have nothing to do with it, even though I proved to him over the course of the last year that precious metals funds have had superior gains over any other funds. "It's merely a fluke!" he would say, precious metals funds have been losers for many years and they will be in the future. My mother is also quite involved in the investment world, and she told me a year ago not to put my money in gold, that it was too risky. I proved her wrong, but she will never admit that I was right.

My point is, is that there are a great many doubting Thomas' out there, and for good reason, they've just been burned bad by every other market. I think many will jump at small profits in the beginning, but when they see that this market is going to be the new(old) market for security and that it isn't going to fail we will see a neverending gradual incline for our PMs.

I hear people talking about investing their money in something tangeable like houses, cars, anything that might have some significant value, but let's not forget over the long run houses get run down, cars rust, and cd's may soon be a thing of the past. We all know that once all the known PM resources are exhausted, they won't be making any more. I have always considered precious metals an excellent long term store of wealth.


But after all, I'm just a RobotGuy.

Hi All-
I was reading on Bloomberg were there is a law suit
against J.P. Morgan chase on the enron collapse. And I
see that the jobless rate is up again, if in fact it ever
went down. Hope to see a pop in gold's today I wonder if
300 mark will hold thru the rest of the week? I guess will
wait and see. Have a good one.... Truthcaster

http://cbs.marketwatch.com/news/story.asp?guid=%7B518277B7%2D56DD%2D4DDE%2D822E%2D84BA56240D63%7D&siteid=mktwsnippet:


First-time requests for state unemployment benefits unexpectedly jumped 64,000 to 460,000 in the latest week, the Labor Department reported Thursday. Economists looked for jobless claims at a level of 377,000.

A Labor official said the unexpected surge was due to re-applications for extended benefits from already out-of-work individuals who haven't yet been hired again.

After recently signed legislation extending benefits, workers whose benefits had already expired are now able to receive funds for another 13 weeks if they signed up after March 15.

The four-week moving average, which irons out weekly fluctuations, stood at 403,750, up from 384,000.

________________________________________________________________________________________________________________________
(More to article)

RobotGuy - - - Surprise numbers, go figure. You mean we weren't able to predict everything like we thought we could?

http://www.usagold.com/gold/coins/rationale.html

They make new BULLION every day.

They stopped making these BEAUTIES long ago.

A fixed supply has its advantages.

Call USAGOLD / Centennial to discuss the investment strategy that's right for you.

http://www.morganstanley.com/GEFdata/digests/20020404-thu.html#anchor0
Adjustment coming,not a matter of if,just when.

He feels it's going to be a "hard landing",too.Due to the scale of the problem and the total lack of focus on the implications,I would agree.

It is my personal opinion that the price of gold is still tightly connected with the perception of inflation. The price does rise a little when something happens like the WTC or a flare-up in the Mid East, but not nearly as much as you would expect. Everytime they feel like the economy is coming back strong, they fear inflation is coming with it. When it feels like Uh-Oh we are maybe not coming out of this downturn yet, the price of gold goes down. I have said this before here, gold will not really take off until there is a real fear of inflation, then watch out.

My personal opinion is that it doesn't matter what anybody thinks about much of anything.

The bought-media tells us what to think, and the government "statisticians" feed us what all mushrooms need.

As long as paper prices physical, the only opinions that count are the cabal's opinions.

Gold is still under pressure this morning and is holding
just above the 300 level at 300.50 dwn $3 It looks to me that we may visit the 290's again good time to buy more
I guess. Crude oil is up at open 39 cents a barrel to $28.
and today at the pump here in the midwest for the cheap
gas, 1.50 a gal. ouch.. Truthcaster

NTT warns of record loss after $15.9bn charge
By Michiyo Nakamoto in Tokyo
Published: April 4 2002 14:28 | Last Updated: April 4 2002 14:36

NTT, Japan's dominant telecommunications group, on Thursday revealed the extent of the damage incurred from its overseas foray. It warned that its net loss would be more than double previous forecasts due to an extraordinary charge of Y2,095bn ($15.9bn), the largest ever by a non-financial Japanese company.

The charge reflects write-downs on overseas investments by its international and mobile subsidiaries and restructuring costs needed to cut excess personnel at its two domestic operating companies.

NTT said its net loss for the year would surge to Y865bn, from the Y331bn originally forecast, although sales and recurring profit forecasts remained the same at Y11,812bn and Y665bn respectively.

But analysts and investors put a positive spin on the revised outlook, saying it cleared the way for a profit rebound.

"True, this is a huge pool of red ink. But getting the write-downs out in the open wipes the slate clean," said Fumiaki Sato, of CDIC IXIS Asset Management. "The bad news is out there and the market can now refocus on prospects for the core businesses."

Of the extraordinary losses, Y1,403bn stems from overseas investments made by NTT DoCoMo, its mobile arm that went on a Y1,800bn buying spree at the peak of the telecoms bubble, and NTT Communications, its long-distance and international subsidiary.

An additional Y692bn charge reflects restructuring costs at NTT East and West.

DoCoMowrote down Y616bn to reflect the decline in value of its investment in AT&T Wireless, Hutchison 3G UK and KG Telecom in Taiwan. This followed a charge of Y300.8bn related to its investment in KPN Mobile in the first half, bringingDoCoMo's total write-downs of overseas investments to more than half the Y1,800bn it has spent expanding outside its home turf.

As a result of the additional charges, DoCoMo will report its first ever loss of Y36bn at the net level.

NTT said its directors would not receive a bonus for the first time, with the president and chairmantaking pay cuts of 20 per cent, the vice-president 15 per cent, and 10 per cent for other directors.

NTT Communications, which has already taken a Y4,980 charge against the decline in value of its investment in Verio, the US web-hosting company, will book a further Y40bn impairment loss against Verio, and Y52bn against its investment in PLDT in the Philippines and others.

The charges allow NTT to deal with the value of its investments in one swoop and concentrate on tackling the increasingly difficult domestic market.

The group faces severe pressure in practically all areas of its business as competition has intensified amid Japan's deflationary market environment.

At the same time NTT faces renewed pressure from the US, which on Thursday published a report calling on Japan and the EU European Union to lower mobile phone interconnection rates and provide "reasonable" prices.

However, Keiji Tachikawa, DoCoMo president and chief executive, on Thursday disputed the US claims: "Access charges in Japan are lower than in Europe. Japan's [charging] system is different from the one in the US, so a comparison can't be made."
+++++++++++++++++++++
This should only add to the gloom and loss of confidence of the Japanese savers...pushing them towards gold.

http://www.usagold.com/gildedopinion/Jensen/20020402.htmlLatest Jensen (excerpt):

Never has President Bush seemed more impotent -- or muddled -- than he does as the conflict between Israel and the Palestinians moves from mayhem to madness.

While other world leaders demand that Israeli Prime Minister Ariel Sharon halt his military offensive in Palestinian cities, Bush demands that Yasser Arafat "stop the violence" -- even while Israeli troops are shooting his policemen.

Arafat, in fact, has repeatedly condemned suicide bombings, but this has not stopped them. The 18-year-old schoolgirl who blew herself up outside a Jerusalem supermarket did not have Arafat's OK; actually, she defied his orders not to harm Israeli civilians.

Such distinctions are lost on Sharon, who blames Arafat for everything: He is the architect of a "terrorist infrastructure," an "enemy of Israel and the free world in general," and a danger to the Middle East. Bush apparently agrees, while his State Department does not.

Asked if the storming of Arafat's office was justified, the president replied: "Israel is a democratically elected government and the government is responding to the will of the people for there to be more security. Israel will make the decisions necessary to defend herself."

The State Department [...] is "greatly concerned about civilian casualties" and has asked Israel to "carefully consider the consequences" of its military actions.

...Zbigniew Brzezinski, former national security adviser to President Carter, in an interview with CNN: "I can see two major jeopardies ahead if we don't step into the breach. If the tragedy between Israelis and Palestinians degenerates into total violence, if Arafat is killed, we'll probably see major uncertainty, major instability in the Middle East. We'll become more isolated in the war on terrorism because the Arabs will unite against us. And we could even get an oil embargo with the Saudis, the Iraqis and Iranians joining forces despite their disagreements. That's a very, very ominous scenario."

----(click link for full article)-----

A diversification into gold makes sense. Gold represents real wealth during good times, and during bad times it represents portable protection from financial collapse resulting from lost confidence and from couterparty default.

R.

It makes you wonder just who to tell anything to, doesn't it? And wish you hadn't...

IMO, the birth of Israel, in our lifetimes (or at least mine), was all about the right of a people to survive attempts at extermination, and to have a safe homeland. It was about burying Hitler's ghost with a big final "Nyahh nyahh, you LOST, sucker!"

Now, obviously Israel, the actually-existing nation of today, doesn't believe it has to live up to my ideals, or anyone else's outside its own borders. It gets to play like any other nation, using what it has to get what it wants. Fair enough. But that threatens to erode the special sympathies that I and many others hold for it, which it doesn't count as worth very much at all.

It really is the conflict between the ideal and the realpolitik, written in a stark contrast for our noses-pushed-into-it viewing.

POG (307$ >> 301$) was the only one in the knew of this speech and its content. Enough is Enough...!?
To Europ : Shut up and leave us alone. Don't interfere with Arafat support. Only Germany (+ Russia) is "with us "...ask Welteke...and remember their holocost past !
Emphasis on the Palestine support(ers) on the adress of Iraq/Syria.
Blair meets Bush this weekend and will co-decide on the Powell C.(not Rich) message to the ME. Hypocritical US/Saudi friendship was also in the message. The word "viable" disappeared out of the mentioning of Palestinian state.
27$ + for POO HURTS ! Arafat is most probably out ! My guess is the (wanted) escalation as a result. But for the time baing, the speech has temporary avoided POG to break its 308$/310$ barrier ! Thanks.

http://www.reuters.com/news_article.jhtml;jsessionid=F1ARAMXCAU3XECRBAEKSFEYKEEARMIWD?type=topnews&StoryID=774243SEOUL (Reuters) - North Korea said on Thursday that the United States was its "most wicked sworn enemy" in a series of diatribes issued less than 24 hours after Pyongyang dropped hints it might restart frozen dialogue with Washington.

"The U.S. is the most wicked sworn enemy of the Korean nation as it is not only hindering inter-Korean exchange and cooperation ... but also putting a stumbling block in the way of achieving Korea's reunification," the state media quoted the North's Asia-Pacific Peace Committee as saying.

A separate KCNA report quoted a North Korean Foreign Ministry spokesman as demanding Washington pay compensation for what it said was a U.S. failure to uphold a key deal which froze Pyongyang's suspected nuclear weapons program.

Yet another statement, in the official Rodong Sinmun newspaper, demanded the withdrawal of U.S. troops in South Korea, saying "it is imperative to put an end to the presence in South Korea by the U.S. imperialist aggression troops."

In what was taken in Washington as a possible sign North Korea was willing to talk, late on Wednesday, KCNA quoted a Foreign Ministry official as saying Pyongyang would re-engage with an international consortium at the heart of the crucial nuclear agreement with the United States.


__________________________________________________________________________________


RobotGuy; North Korea surprised me when it was implied they were considering talks again, but then they've just done a seemingly 180 and surprised me again. Might as well throw Canada in with the U.S. too, cause we seem to have an affinity with each other, and Cretien seems to be quite willing to assist wherever assistance is required. North Korea, Iraq, surprising news headlines in roughly the same 24hrs, hmmmm.

http://www.usagold.com/gildedopinion/Jensen/20020404.htmlHEADLINE: 'Israelis, Palestinians both have blood on their hands'

(excerpts)

Fifty-seven Islamic nations ended a three-day conference in Kuala Lumpur, Malaysia, by condemning terrorism "in all its forms" but failing to define it.

Arab delegates unanimously rejected "any attempt to link terrorism to the struggle of the Palestinian people in the exercise of their inalienable right to establish an independent state."

It all boils down to that age-old question of who is a terrorist and who is a freedom fighter. Some of today's nations were, in fact, born of terrorism and some terrorists of yore are now respected statesmen and Nobelists.

Terrorism freed the southern Irish Republic from British rule and has forced Britain to relax its hold on Northern Ireland. Much of colonial Africa and parts of Asia were liberated by terrorist wars. Israel had its terrorists and the Palestinians, too.

Menachem Begin blew up the King David Hotel to drive the British out of Palestine. The Irgun and Stern Gang terrorized Palestinians before the creation of the state of Israel. And Yasser Arafat has employed terror against the Jewish state.

Yet Begin won the Nobel Peace Prize for signing the Camp David accord, as did Arafat and two other Israeli leaders for signing the Oslo accord. And the ANC's Nelson Mandela, who spent most of his life imprisoned as a terrorist, is not only a Nobel laureate but hailed around the world as one of its premier peacemakers.

That's why the United Nations, which has spent years grappling to define terrorism, has never managed to do so. And that's why President Bush has been forced to admit that he cannot brand Arafat a terrorist simply on Israeli Prime Minister Ariel Sharon's say-so.

While Sharon compares Arafat to Osama bin Laden "that's not a comparison the president accepts," said White House spokesman Ari Fleischer, noting that Arafat participated in peace talks before they broke down and, for better or worse, remains a symbol of Palestinian aspirations.

Lev Grinberg, a sociology professor at Ben Gurion University who frequently writes for the daily Maariv, says the United States is "evil" for supporting Sharon, whom he considers as bad a terrorist as the suicide bombers he is after. "The state terror and war crimes perpetrated by the Israeli government are legitimized as 'self-defense' while Arafat, even under siege, is demanded to arrest 'terrorists.'

"At the same time, Sharon's responsibility for Israeli war crimes is completely ignored. Who should be arrested for the targeted killing of almost 100 Palestinians? Who should be sent to jail for the killing of more than 120 Palestinian paramedics? Who will be sentenced for killing more than 1,200 Palestinians and the collective punishment of more than 3 million civilians during the last 18 months?

"And who will face the international criminal tribunal for the illegal settlement of occupied Palestinian lands and disobeying U.N. resolutions for more than 35 years?"

Sharon and Arafat both have blood on their hands. Perhaps the European Union's Javier Solana was right in pointing out that "neither is a saint" and both sides would be better off with new leaders.

----(more at link above)-----

In a tumultuous world beyond your personal control, it makes good sense to own some gold. Gold is wealth itself, while the value of paper depends on counterparties who tend to fail or simply step away from financial obligations when chaos permits.

R.

http://216.234.182.183/members/eagleranch/#os-2While the market may face a rough patch in the near term, due to the lopsided and negative (and manipulative) COT position in gold, silver and copper, the fundamentals in silver are something else. There have been multiple posts recently, on every metal site around, about how much silver Red China is exporting. Not only are these stories pure c()ap and unsubstantiated, they are obviously being leaked out for an entirely diffrent purpose - to help Red China buy silver on the cheap. Here, you're going to have to use some common sense. The numbers being thrown out go like this - China produces around 60 million ounces per year, and is exporting around 40 million oz. That implies a net consumption of 20 million ounces a year.

The US (the world's largest consumer of silver, and every other commodity) consumes around 250 million ounces a year, on a population of 280 million. Let's call that an ounce per head. China has a population of some 1.3 billion, and consumes just 20 million ounces? Huh? Does that make sense to you? While I know China is not consuming an ounce per person, it is consuming a hell of a lot more than 20 million ounces. After all, its economic growth has been blistering for years, compared to the US and the rest of the world. It is Kodak's second largest market currently, and that company says it will be its number one in the not too distant future. Additionally, China is said to be the world's second largest consumer of copper. It is not possible for them to consume the small amounts of silver implied in the planted stories. I don't deny that China is refining and smelting more waste recycling silver, with the waste imported and the refined silver being exported. Obviously, the folks sending the waste to China for refining, demand the finished product in return. That's because of China's willingness to tolerate environmental damage not acceptable elsewhere in the world. But its willingness to be the toxic processor of last resort, does not make them a big net exporter.

Red China treats its commodity statistics as state secrets. It only tells you what it wants you to think. It wants you to think it has plenty of silver. Common sense should tell you with a mine production of only 60 million ounces a year, a population of 1.3 billion, and a goal and trend for its people to enter the modern world, China, of all countries on the face of the earth, faces a silver need and crunch more desperate than can be imagined. These stories are intended to make it easier for them to buy silver. Don't be fooled by their lies - use your common sense.
**********

As usual, well said.

G.

Sir, your Morgan Stanley article on CA-deficit, learns us that the politico/financial collusion, chooses the most appropiate moment for the final inevitable corrections !
Stockmarket / Gold / Interest rates, are managed against the clock, ticking economic realities. Adjustments or better "crashes" up or down just wait for their approval signal ! Than the markets get a fresh bout of freedom...alas for temporary adjustments. The dollar (down) and interest rates (up) are still defying gravity. And there are so many dollar-holders out there ! The main reason why long awaited approval for adjustment stays away is the monstrous "Derivative" positions that builded the mega anomaly in the first place. It was not assurance but speculation with a purpose of blowing things up out of proportion. etc...etc... Thanks for bringing it up.

I thought of something just now. We often speculate in this forum on the causes of the immediate past; why did ths happen; why did that happen etc. The fluctuations in precious metals are often followed by a flurry of hypothesis, and sometimes cold hard facts.
Key word, followed.
Why is it that we do not combine our many talents and hypothesize the immediate future? Is it because we're all under the understanding that precious metals are rising in value and there are no two which ways about it.
I think this recent subtle drop in gold could have been determined had we stuck our heads together and speculated what the immediate future might hold. Sure, there are always random functions, but for the most part we all have a general consensus of what is happening, and what is likely to happen in the near future.

For example, last weekend I was thinking to myself gold will probably go down this week, without thinking too hard of the reasons why it might. If I were sure about myself, I could have stood to make a little money. I am also thinking that gold may continue to drop a little over the course of the next several hours, but will probably go back up on Friday, closing above 305. Now here's the clincher, I'm not certain, that's just my gut feeling.

Would anyone care to join me in my speculation of the near immediate future of market conditions?

If I were to provide reason for my speculation it would probably be another page of blah blah blah, so I'll stop here for now.


RobotGuy.

http://www.reformation.org/rome_robs_fort_knox.htmlLinks

West Point Gold Reserves belong to German Bundersbank.

Freemarket Gold and Money Report

Gold Anti-Trust Action Committee

Gold-Eagle.com

Gold.org

Link to the Mexican-American War of 1848

Gold rush Museum in Oakland, California

Sir Francis Drake's voyage to North America

Diary of Drake's voyage from a Roman Catholic college

Thanks to all the Australians that visit

Gold Discovery in Australia

Vatican ship sinks

Vatican bank has Nazi gold!!

Vatican Revealed As Major Dealer in Gold!!

Vatican Bank Top 10 Money Laundering Destinations!!


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

Editor's Notes

Before the fall of the Papal States, the stolen gold was brought directly to the Vatican and stored in huge deep underground vaults. That is not possible now because the Italian customs would see the gold and the Italian government would keep it. For that reason they cannot ship directly but must use Swiss and German vaults to store the loot. Maybe it is wishful thinking on the part of the U.S. Treasure but they have re-classified all the U.S. gold as "deep storage gold."

Before the fall of the Soviet Union in 1991, the Vatican feared a Soviet invasion of Western Europe and did not want to accumulate a lot of gold there. However, within the past 7 years, the flow of gold out of the U.S. and into Swiss and German banks has been enormous.

After South Africa, Russia is the second largest producer of gold in the world. By keeping the price of gold artificially low, Russia is deprived of millions in revenue that could be used to resist a NATO invasion.

According to the Bible, gold is so plentiful in Heaven that they use it to pave the streets and the Popes cannot steal any of it:

The game is so rigged against the average "Joe", that even if he can keep his sanity, he will lose his money surer than in a casino with the overall odds for the house. I'll try to explain as best I can.

Let's take a nice little PM stock trading for 10.00, but with a market maker(MM) trying to establish a long term position in the stock. Fundamentals are good for PM's and the market maker estimates the stock can (will if he's good) go to up over a three month period.

The MM establishes a "floor" for the stock with say a bid of 100,000 shares @ 9.50. These bid/ask prices are transparent to anyone with the right software (Level II Nasdaq for example).

Now, once a few traders realize that some big player hasn't stepped in and sold into the bid (a real risk for the MM or any player placing large limit orders), they start bidding the stock up and in effect taking all the limit sell orders over 10.00. All the while the MM uses his short term trading account keeping bids just below the market, capturing stock from the "market sell orders".

If a MM or big player keeps substantial bids right below the market price, the stock goes up with the MM accumulating shares. He also more than likely moves his "floor" bid up as a trailing buy to help protect the price of his trading account. Don't want a large trader who is playing the opposite game (short sellers) to be able to take the price down too far with a sell of 50,000 shares or so that would put the MM's trading account under water.

Complicated enough yet???

Now lets say the MM gets the stock up to 15.00 or so without attracting a big short player, who is someone who thinks or knows he has the resources to play the same game as the market maker, but on the downside with short positions. It's now time for him to take some profits or basically unload some of his stock. Now he puts in a block sell order in above the current price, and the whole thing starts over but on the downside. The MM can usually control the price on the way down so as to put a big bid back in at key technical levels - say fibbanchi numbers (smile)??? and then work the price back up.

Throw in day traders, short sellers, funds, option writers, into the mix, all with their own views on where the markets and stocks are going, all with different resources, most all with computers programmed with trading strategies, and you may just start to see why markets are volitile.

All the big players "war" with each other for their share of the invester's money, and each others. The above example is played out by some in seconds with spreads in the pennies, by others in minutes with spreads in the tenths, by others in hours with half point spreads, etc.

Now, big traders and MMs will also place big bids in and then pull them almost instantainously just to fool the other traders and try to trigger computer programs that they are positioned to profit from. Others have computer programs that place bids into the market at one price, but actually show another price on the level II screens in order to make their bids invisible.

Still want to trade paper????? Do you really think you know just when or where the MM is going to place his floor bid. Or how about a fund that has written a block of calls on your rising stock as they unload their positions and force the price down or cap the rise while there is good news. Sound familiar???

It's only about 100 times more complicated than my feeble example and explanation above.

Playing paper or buying physical??? Which makes more sense?

There's a storm on the horizon. Want to live in a paper house or a PM house. (Ah, hell, go play paper if you want, the big boys are having to fight it out amongst themselves right now and they'd love to have you toss your few bucks into THEIR GAME.)

Pizz

You're a breath of fresh air...it's nice to know there are some people that know the "numbers" game and aren't one of the bad guys. Even a financial idiot like me can understand enough from your post to know which side us rookies need to stay on. Thanx for all your insight.

Mining company sells forward to Bullion Bank, Bullion Bank swaps forward contracts for vault gold and sells. Voila! Deep Storage Gold

I do the same thing with smaller valued stocks. You need to have a good reserve to keep feeding the market to stimulate upward buying, not to mention it's all so helpful when the POG fluctuates, and everyone get's excited. Gold price fluctuations are the mechanism by which the overall expanding floor is advanced and strengthened. Sure, I'm not a billionaire, if I were I wouldn't bother with anything paper related, but even a rookie like myself can earn far greater returns than that percentage the bank pays on a savings account. I take losses, but generally overall my capital manages to continue growing.

Why not put it all into gold? This is my gambling money :)


Thank you for your post.

RobotGuy.

$252
$272
$292
$302

Learned the hard way. My wife's Barbi doll collection has a better track record than my option trading over the past 10 years.

She's getting ready to sell a few dolls now and buy gold. Haven't figured out if it's because of me or just the fact that she's run out of space in her doll room. At least she's pointed in the right direction.

Pizz

Nice follow-the-bouncing-ball example...!

I already sent your post to a couple of guys here to help illustrate the travesty that goes on in the name of "reasoned and deliberated investment."

Good point, that these guys may intentionally reverse at key TA levels. Lots of technical players provide a nice solid wall to bounce off. This also serves to fool people into thinking that these kinds of analysis are as magical as they are made out to be -- which then reinforces the process, so that they have predictable fodder to work with the next time they cycle through... what a gas...?!

cheers,
miner

RE: Posting # 77698In following the URL link to the Centennial Precious Metals page you included with your recent post one finds at the top the following: "While we find Mr. Jensen's columns particularly informative with respect to foreign affairs, his opinions do not necessarily represent those of Centennial Precious Metals, USAGOLD, its management and clientele." If that is true, why do you bother posting Mr. Jensen's one-sided opinion piece at all? At best, it is laden with half-truths. At worst, it is morally confused claptrap. I've discussed the Middle East situation on mumerous ocassions with MK so I know that he doesn't subscribe to the ideas of moral equivalence that Jensen espouses. It seems to me that, while you are entitled to share Jensen's misguided opinions, it certainly does no good for CPM to post inflammatory opinion pieces on official CPM pages as if they were truly "informative with respect to foreign affairs."

Not sure why I am even bothering to reply.

"...It all boils down to that age-old question of who is a terrorist and who is a freedom fighter..." sounds like b.s. to me.

What difference who, why, or what awards; if you knowingly kill innocents, including women and children, that sounds like murder to me. Mass murder is a qualifier for how many.

Years ago, I was personal friends with a mass murderer. They shot him like a mad dog for his rampage. He died on the University of Texas Tower, and never got to win any those awards.

Charley was a mass murderer, and they killed him right where he was. They did the right thing.

The Word "Adjustment" is a Euphamism for "Devaluation"Apr 04, 2002
Winds of Change Finally Blowing

On Current-Account Adjustments
Stephen Roach (New York)

Hints of America's coming current-account adjustment are already in the air. As Joe Quinlan noted in yesterday's Forum, just-released data on foreign capital inflows into the US for early 2002 point to a significant shift in the sources of external financing. In January, portfolio inflows into dollar-denominated assets slowed to just $11.3 billion, a marked deceleration from average monthly flows of $44 recorded during 2001. If this trend remains even remotely intact, I believe America's ability to finance its massive external deficit will become severely impaired. And then the US current-account adjustment will begin in earnest.

What might such an adjustment entail? That's a question I get a lot these days as I pound the table on what I believe is the key macro tension point for the US economy. Fortunately, there are important lessons from history that may shed some light on what the future holds for America as it faces up to the coming external adjustment. A recent research paper by a Fed economist provides some compelling evidence of potential responses as drawn from the experiences of some 25 current-account adjustments that occurred among industrialized countries over the 1980-97 period (see Caroline L. Freund, "Current Account Adjustment in Industrialized Countries," Board of Governors of the Federal Reserve System International Finance Discussion paper #692, December 2000, available at www.federalreserve.gov). While this history offers no guarantees of what lies ahead for the United States, there are some important lessons that I do not believe should be taken lightly.

First of all, the Fed study finds that the median current-account (CA) adjustment of these 25 episodes occurs when the external gap hits about 5% of nominal GDP. It then takes about three years, on average, for the adjustment process to run its course. Even after those three years, the median CA is still in deficit to the tune of about 1% of GDP. There is considerable variability within this sample as to which CA deficit threshold triggers the adjustment. The last time it occurred in the United States was in 1987, when the CA gap was 3.7% of GDP; three years later it had shrunk by 56% to 1.6%. There are, of course, many episodes of CA adjustments that predate the 1980 time frame. But the sample in the Fed study was restricted to that period largely because it had two key characteristics in common with current international financial conditions -- broadly based financial capital mobility and flexible exchange rates.

It's the dynamics of the CA adjustment process as revealed in this Fed study that I find most fascinating and pertinent for the economic outlook. (Note: The results reported below are for the median CA adjustment over the 25 episodes contained in the 1980-97 sample period). First, the adjusting country typically experienced depreciation in its real effective exchange rate of about 20%; in only two of the 25 instances did the exchange rate appreciate -- Canada in 1981 and Denmark in 1988. But they were the obvious exceptions. Typically, the devaluation began about a year before the CA gap hit its peak and then continued for another three years. At the same time, the depreciation in the nominal exchange rate was, on average, more than double the decline in the real exchange rate. Second, real GDP growth slowed, on average, by about three percentage points from the year prior to the CA peaking; that impact was largest in the first year of the adjustment process. Third, short-term interest rates typically rose in the beginning of the CA adjustment as central banks attempted to limit currency depreciation; toward the end of the adjustment process, short rates typically fell as the downside of the business cycle played out.

Fourth, the Fed study found that an improved trade balance was an important by-product of most of the CA adjustments in this sample period. Interestingly enough, trade turnarounds were mostly export led, with real export growth being boosted, on average, by four percentage points over the course of the three-year CA adjustment. Import growth, by contrast, slowed quite sharply in the first year of the CA adjustment -- a four-percentage-point reduction, on average -- but then returned to its pre-adjustment trend two years later. Fifth, CA adjustments are typically more investment- than saving-led; national saving ratios change little over the first two years of the adjustment period, whereas aggregate investment ratios typically fell by close to two percentage points over the same period.

All this paints a pretty clear picture as to what to expect in the coming US CA adjustment -- a weaker dollar, slower GDP growth, a less accommodative Fed, firmer exports, and weaker imports and investment. It's yet another manifestation of America's post-bubble adjustment process. During the Roaring 1990s, Americans (especially consumers) took great confidence from equity wealth effects and drew down their income-based saving balances to historic lows. The result was a saving-short US economy that had to rely increasingly on foreign capital to finance its IT-led investment boom. And America had to run a massive CA deficit in order to attract that external capital. But in doing so, the nation lived well beyond its means -- as those means were defined by the domestic income generation associated with national production.

The coming CA correction suggests that this same movie is now about to run in reverse. In my opinion, it's just a matter of when, not if -- and what triggers the adjustment process. Along those lines, there is great debate on whether the coming landing will be "soft" or "hard" -- gradual or abrupt. This is particularly problematic since the dollar is the world's dominant reserve currency and the US is the world's largest international debtor. Given the saturation of dollar-denominated assets in foreign portfolios, a crisis of confidence is not inconceivable. Should that occur, I believe a hard landing would be inevitable. The metrics of past CA adjustments has little to say about differentiating between these two possibilities. But one thing is certain: The longer the day of reckoning is put off, the more severe the macro impacts of the adjustment process are likely to be. That's because CA adjustments are not complete until the deficit gets reasonably close to balance. In the 25 instances covered in the Fed study cited above, CA deficits ended up, after three years, being less than 2% of GDP on all but four occasions. In other words, there's little dispute over the endgame. It's just a matter of when -- and from what extreme -- it begins.

Needless to say, all this has important implications for financial markets. As I see it, two aspects of America's looming CA adjustment should be especially important in that regard -- weaker GDP growth and a fall in the dollar. A shortfall in GDP growth implies a weaker earnings trajectory than most equity investors are assuming. And a weaker dollar should provide ample incentive for global investors to diversify out of dollar-denominated assets -- consistent with our global decoupling thesis. I remain convinced that America's ever-widening current-account deficit is on an inherently unstable path. A correction is coming and there's no dark secret as to what that means. It's just a matter of when the denial finally cracks.
+++++++++++++++
The writer has suggested for months that such a move is in the works.
Chapman's sources have the deval at 19% [Canadian dollar to rise by that amount]

The real problem is the "control" of gold. A $360-$375 pog will be shock enough for the paper sellers on Wall Street [The Pisanis of the World]. There are just too many variables swirling around to be certain about the consequences of a deval...but one is mandatory nonetheless.

This piece is a loud warning...an unmistakeable clarion call from a semi-official Fed mouthpiece...perhaps the final warning to GET GOLD...NOW.

It could easily "Get away" from the Fed. Especially with the arrogance factor radiated by AG.

Black Blade & Sierra Madre...I agree with your points of last night re using gold stocks as another way to attack POG that's why I had posted those articles showing stock movements and comments by Big Boys this week.

Today, I have been watching Level II on NEM for well over an hour ....during the beginning of the time frame gold stocks were going up ....as we are aware NEM is often seen as the Leader in unhedged.....there was an interesting play between NYS and NAS ...both exchanges...where they would keep putting large numbers up and then pulling them ...trying to limit sales and lower price ...it certainly cut back action when NEM was on a good rise...finally NEM broke thru but it was a fight!

Now who do you think is behind these exchange moves...normal investor doesn't move large blocks and constantly pull and re-do...it was like a dance between the two

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=APKvt_hUSSi5QLiBN
Snippit:

Houston, April 4 (Bloomberg) -- J.P. Morgan Chase & Co., Citigroup Inc., Merrill Lynch & Co. and Credit Suisse First Boston will be named as defendants in suits seeking billions of dollars over Enron Corp.'s collapse, people familiar with the litigation said.

Enron investors and former employees have decided to add law firms and as many as eight banks on Monday when they amend their suits, alleging fraud, against the energy trader and its former auditor, Arthur Andersen LLP, the people said.


Black Blade: Not really much of a surprise here. However, the scope of the Enron affair can be damaging to some corporate bottom lines.

Appears same game playing on GG ...and they did succeed there....well we know every trick will be played...but the time is getting short

In all honesty it is
not really a question of the greed factor so much as the way the "Brokerage
firms" "financial advisors" or whatever you want to call them have structured
themselves in the last twenty years. They have made it very difficult to be an
honest broker for your clients. There main money makers are investment banking
and various asset collection and sale products. In other words they look at
the clients only as a potential market for the bonds and stocks that their
real clients the companies want to sell to them. The stockbroker is viewed as
simply someone who has a personal relationship with a collection of potential
buyers for "deals". So that when there is a new stock issue or a bond issue,
Merrill Lynch can say we have seven thousand brokers that will sell that issue
for you at the best price. That is it. The rest is just window dressing to
keep the clients passive and fully invested in whatever the brokerage firm
wants them to own. The various half truths like "long term investing" "buy and
hold" and you will make 10-15% if you wait long enough are really just buzz
words that years of salesmanship has divised to make it easier to tell the
client to stop whining when the stockbroker is really as confused and scared
as the client is. The main problem is that all the money of these firms is
made by selling stocks and bonds for corporate clients when the corporate
clients want to raise additional capital through debt or equity issues. The
commissions that you and other clients pay that they are looked upon as simply
a subsidy to reduce the cost of having the seven thousand stockbrokers there
to sell the securities of the firm for the large deals. In order to keep the
pigeons in the roost the firm spends a lot on advertising and positioning and
self serving "research" that is really only designed to acheive the main
reason the firm exists at all. This field much like medicine is not really the
Marcus Welby type of place that it once was, when capital was scarce and each
stockbroker had to work hard to get his client to take it out of the bank or
his business. Today capital is abundant and can be created by a refinancing
gimic or through the Federal Reserve waving their magic discount rate and
flooding the market with some more recently printed up liquidity. The whole
game has changed and just like in medicine if you think you are talking to a
caring Marcus Welby type on the other side of the investment desk, you are
either amazing fortunate to have found one or deluding yourself. There are a
few old timers left who have the clients best interests at heart and have such
a strong relationship with their clients that the firms leave them alone, but
in reality most are young inexperienced second tier intellects that are
totally clueless about what really drives the investment markets but know all
to well what gets them paid. Caveat Emptor was first uttered in ancient Rome
by a disgruntled mutual fund client. He was right, and wiser for the
experience. Most of the problem with the whole industry, and I am a
stockbroker by the way although I refuse to practice, is that truely reasoned
opinions that reflect the actual factors that should be considered in the
investment process are not discussed or really allowed to be aired. They would
queer the deal! If the public wakes up and hits the road we have no one else
to make a living off of. So you constantly hear only the bullish side of the
story and anyone who dares try to inform the investing public of the other
side of the equation is ridiculed, mocked as a pessemist, and marginalized. It
is like a court room trial where the search for justice is carried on by only
the prosecution being allowed to present their case. The defense is not
allowed to talk. The media who lives off the advertising revenue from the big
mutual fund companies and brokerage houses,tends to understand the concept of
not biting the hand that feeds it and the so called corporate "free press"
largely follows along. That said, it has not been that bad to be an investor
in this world until the politicans and wall street conspired to bubble the
market to levels way beyond any sensible level of value. With a Dow near
eleven thousand that would be highly valued at half that price the
consequences for our generation become their ability to retire. So the game is
rapidly becoming much more important, whether the clients want it to or not.
So that is what I meant by my reference to the Wizard of Oz. It is a period in
time when to not be informed of what is really going on with your capital will
throw a very long shadow.

Every day that the Isrealis can stretch out negotiations, they are able to build more settlements and acquire more land. They have succeeded in stretching out these negotiations for years now and have taken large tracts of high ground in a strategic system of dividing up the Palestinians into smaller and smaller clumps. the Palestinians know this and they are watching their lands being taken over. They have tried fighting this slow encroachment in many different ways to no avail, and now are reduced to suicide bombing. What else can they do? The longer the status quo the more they lose. There are UN resolutions requiring the Isrealis to halt the building of settlements, but they are ignored.
I really believe that the Isrealis cannot give up the Zionist dream of having it all.
The great problem here is that unless they do give up the Zionist dream, they will one day want to build the new temple on the temple mount which requires removing the Mosque now in that location. If they do this, they will plunge the world into war, no doubt about it.
So it comes down to this, will the Isrealis be able to let go of Zionism and recognize that that mosque is going to remain there and they are going to have to stand down there praying at the wailing wall with Muslums standing up above them looking down from the temple mount? I think not.
Because if they do this they will not only have to let go of their long history, but they also fear that Arabs will be so emboldened that the Islamic dream of wiping them off the region will grow. There is no solution other than that which God has ordained, whatever that may be, but it aint gonna be pretty. I think most of us call it Armageddon

http://www.forbes.com/work/managementtrends/newswire/2002/04/04/rtr559047.htmlGlobal gold mine supply seen in sharp decline
Reuters, 04.04.02, 7:03 AM ET

LONDON, April 4 (Reuters) - World supply of mined gold may plummet by nearly 30 percent by 2010 unless bullion prices rally and prompt miners to bring untapped deposits on stream, a mining study showed on Thursday.

Toronto-based mining investment banking and research firm Beacon Group Advisors forecast global gold output falling this year for the first time in two decades, reflecting years of low prices and slashed exploration budgets.

Supplies should continue to fall, with the decline accelerating after 2006 as output dropped from mature mines in the United States and Canada.

"A gold price above $325 is needed to prevent the decline," Beacon Group managing director Don MacLean told a mining conference where the study was presented.

The findings are likely to encourage gold market bulls who see the prospect of reduced mine supply driving prices above $300 a troy ounce, where bullion has been capped for most of the past two years.


(Need to be sure you have gold on hand as well as BB's other listed items...I have some mining shares for play but like the real thing for security)

I noticed your comment about the shootings at the University of Texas back in the sixties. That was really one of the first such events that I was cognizant of. Would you mind telling how you came to know him and what drove him to that level of desperation?

Every week huge amounts of money go into all those 401K plans. That has to mean that there is constant pressure on stocks to go up. Now, when stocks aren't climbing, where is all this money piling up?

I've been provided with the latest weekly consolidated financial statement of the Eurosystem, worth special note because it reflects the latest asset revaluations based on their quarterly mark-to-market practices.

Cutting to the chase, the gold assets of the Eurosystem rose by 12.994 billion euros on the revaluation from last quarter's price per ounce, now standing at 139.808 billion euros in value.

And lest you think for a minute that the phenomenon was a result of the euro losing value, think again. Here's the quarterly performance of Eurosystem assets on a per unit basis as priced in euros.

DOLLAR unit value
@ end 2001 = 1.135 euro
@ end March �02 = 1.146 euro

YEN unit value
@ end 2001 = .00867 euro
@ end March �02 = .00866 euro

SDR (Special Drawing Rights) unit value
@ end 2001 = 1.4245 euro
@ end March �02 = 1.4297 euro

GOLD unit value (per troy ounce)
@ end 2001 = 314.99 euro
@ end March �02 = 347.32

Here, then, is the summary of the percentage performance of each asset over the quarter on a per unit basis:

dollar UP 1.0%
yen DOWN 0.1%
sdr UP 0.4%
gold UP 10.3%

Through this, even the dimmest central banker can see the future glowing firmly; and we can, too.

With this compelling trend, there is no wonder that the European Central Bank and its national member CBs allowed, for example, the EUR 1.6 billion drawdown last week of their net position in foreign currency. This asset account of foreign paper now stands at a still massive EUR 258.6 billion to start the next quarter.

Meanwhile, the gold asset account continues its generally steady climb since euro-launch January 1999 where it stood on the books at 99.598 billion euro. Allowing for the bolstering of the gold asset account by 1.5 billion euro with the Greek membership in January 2001 (and not forgetting the measure of early Dutch, Austrian, and late German sales in accordance with the Central Bank Agreement on Gold), the gold assets of the Eurosystem have performed nicely over the years, now valued at EUR 139.808 billion.

Look for more of this -- letting the winners keep running while the weaklings get cut from the team. I hope this summary has been helpful for showing gold in its new light.

Again, here's a reminder of the first element from ECB president Duisenberg's September 26th 1999 joint Statement on Gold from Washington, D.C.:

"Gold will remain an important element of global monetary reserves."

Amen.

Randy

http://biz.yahoo.com/rb/020404/economy_jobless_7.html
Snippit:

WASHINGTON (Reuters) - The number of new U.S. jobless claims filed last week skyrocketed by 64,000, partly due to applications for a new government program that extends unemployment benefits for 13 weeks.

Black Blade: Note that recession level unemployment growth is often quoted at 400,000. The BLS announced 460,000 new unemployment claims (partly due to extended benefits). However, these are "seasonally adjusted" numbers (read statistically manipulated). Many others simply do not qualify for extended benefits. Tomorrows numbers are expected to show 50,000 new jobs. I seriously doubt it though as these numbers will be massaged as well � I expect to see additional job losses as there has been for several months.

Actually both sides have a dream of having it all...that's why they are enduring a nightmare....and the world faces a potential for a Major war.

Both have to give up their dreams and face reality of compromise...which so far they appear unwilling to do.

By the way, speaking of dreams...I had a strange one several weeks ago where I was seeing the Dome of the Rock blow up....I hope this was also a nightmare and not a premonition...for the women of my family seem to have a Celtic strain where dreams often come about when strongly felt ...so say a prayer ...for if that were to happen...the proverbial Hell would break loose!

If we are talking about Charles Whitman, then we are talking about someone who was mentally ill. He had approached professionals and clergy for help, however, they were not equipped to deal with his illness. After he was killed by the Texas Ranger who entered the upper deck, his body was transported to the medical center. An autopsy revealed a brain tumor (the cause?). Perhaps not a real comparison to terrorist though.

The situation in the Middle East is much more complex. One man's terrorist is another man's freedon fighter. Asw far as killing innocents as rationale for the difference, then we maybe we should reevaluate the dropping of atomic bombs on Hiroshima, Nagasaki, the carpet bombing of Dresden (not a military target), The bombing of London, etc. Certainly many innocent were purposely killed in war and yet we do not refer to the combatants as terrorists. As I have said in the past - Murder millions and you're a conqueror, murder a few and you're a terrorist. Go figure.

- Black Blade

RobotGuyThere are plenty of reasons in the world for Gold to rise and it still hanging around the $300.00 level. Every time we see a $2.00/$5.00/$6.00 rise in POG we tend to believe the BIG ONE is close at hand. Only to have the POG beaten back.
Looks like we are a family going on vacation. Driving to some amusement park and have two children in the backseat.
Yepper, you know that after about an hour driving they start in with, Are we there yet! Of course your answer is,Just alittle longer. You know you still have about 4 hours drive and you begin playing those on the road games. I SPY, Licence Plates,etc. So where is there? What is it going to take to get there? Yes, for the POG to rise.
Will it take China to invade Taiwan? North Korea to invade South Korea? Maybe. How about a full scale war in the ME.
Well, I don't think so. Not even a nuke or some Bio out break will do it. How can I say this. Just that with all that has happened GOLD IS DIRT CHEAP. So what do I think will do it. When it hits the public in the wallet hard.
When they finally realize it is just paper. If the stock market dropped again there would still be payroll deduction going into it. If you always do what you always done, you end up with the same results. They have to change their way of thinking. Otherwise, why would they take any provision to secure wealth. We are a society of credit. And credit equals debt. Gas is going up. Going to buy it anyway. Have to go to work. Grocery bill going up. Got to eat. Electric bill going up. Have to have lights. They public knows it going to take more fiat for the same things yet they fail to make the connection on how to preserve wealth. So, THERE is when it hits the wallet. That paper is just paper. By that time it will be too late for some. The warning signs are there. Argentina and Japan Knows. Until the general public of any country gets a jolt and the rug pulled out from under them, Its is my opinion gold will be slow to rise. But rise it will. So along the way, accumulate and enjoy the veiw.
All the roadsigns are there. We just have to be patient and follow them.
Heck, Are we there yet!

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

Must be real tough in the COO offices this quarter. Trying to justify multi-million dollar salaries, bonuses, etc with LESS THAN REAL NUMBERS to publish.

If my intuition is correct, nearly all public companies books are either pushed or at least aggressive. They've had to do it to keep their stock prices competitive and to keep their investors happy.

Now thanks to Enron, not only are the beancounters keeping the current books straight (or straighter) they are also on a witch hunt and are reserving the heck out of anything that has been optimistically booked (nice term for fraud) from quarters past that had been negotiated past the auditors. (Final numbers are negotiated just like barter - believe it).

Controllers are not intimidated in this environment and the real laughing matter from their point is that their marketing executives can't even gripe or put a spin on the fact that they feel current numbers aren't reflective of what they did in the past quarter.

What are the executives going to say?? We feel current numbers are low because we've been pumping our books in the past? I don't think so.

Market support seems to be drying up. Kind of like sliding real fast over thin ice on a frozen pond. When your momentum (earnings) slows, the ice has a bit of a problem supporting your wieght. JPM at 40 plus earnings???? Wish I could throw them a golden anchor.

Pizz

Nickel62, I just saw you post. If you don't mind, I'll have to get back to you later today, or in the morning.

For now, Charley was a great guy, the All-American type. Some of his other friends & I were talking about him the other day. All of us felt like he simply "went nuts." Not the type to kill a bunch of people, especially his mother and wife. He absolutely adored both of them.

But killing innocents is NOT okay....even when a friend does it.

Sorry, but have to get back to you later.
regards

http://biz.yahoo.com/ap/020404/retail_job_cuts_1.html

Retail Job Cuts This Year Could Be the Worst in at Least Two Decades

Snippit:

NEW YORK (AP) -- The pace of retail job cuts, which increased dramatically after Sept. 11, has accelerated in 2002 and this year's losses could be the worst in at least two decades, as the industry consolidates, according to a major employment study to be released Monday.


Black Blade: This doesn't sound like much of an economic recovery to me. In a recovery one would expect more consumer spending and therefore more hires in retail. Not a good sign � in a word "GRIM"

As always, get out of debt, get Gold and Silver portfolio insurance, get enough cash on hand for several months expenses, and get a nonperishable food storage and basic goods program started.

http://biz.yahoo.com/djus/020404/200204041648000751_1.html
NEW YORK -- Oil prices tumbled Thursday after President George W. Bush called on Israel to withdraw from Palestinian territories and announced that he was sending Secretary of State Colin Powell to the Middle East in a bid to end the violence.

At the New York Mercantile Exchange, crude oil for May delivery slumped 98 cents, or 3.6%, to settle at $26.58 a barrel, after setting a new six-month high of $28.35 during intraday trading. June crude oil surrendered 85 cents, or 3.1%, to $26.81 a barrel....


Black Blade: This is much of the reason for the sudden reversal of Oil and Gold today. Oil had hit prices above $28.00/bbl, and soon as Dubya gave his speech prices tumbled. Apparently there's a lot of faith in Dubya's and Colin Powell's abilities. We shall see.

Yes, yes, yes... well put...!

Then there's the additional consideration of each firm having to keep up with its most daring rival. If firm X, is willing to take certain risks to eek out a little more return to outdo its competition, each similar competitor generally has to undertake these practices to keep up, as the typical investor does not know enough of what goes on under the hood to satisfactorily gauge the additional dangers, and thus make a sound risk/reward discrimination.

http://www.lemetropolecafe.com/james_joyce_table.cfm?cfid=2174794&cftoken=13913πd=1156Well, maybe a slight exaggeration, but still nice to see him quoted elsewhere. Couldn't happen to a nicer guy, given all the insight to gold and energy that he has given us.

BB, you're not going to start charging us, are you?

Best regards.

The whole segment:

An interesting USAGOLD post:

USAGOLD (04/03/02; 16:34:36MT - usagold.com msg#: 72645)
Black Blade, Siochain. . . .ALL
http://member.usagold.com/commentaryreview.html
Something interesting is going on in the overall gold derivatives' positions. The top three U.S. gold bullion banks' positions fell from $73.2 billion in Dec00 to $48.9 billion in Dec01 reflecting the overall reduction in the gold carry trade positions over the course of 2001. John Doody (Gold Stock Analyst) says "recent CB efforts, overt and covert, are designed to keep a short-term lid on gold's price, effectively 'holding the door open' for the commercial banks to get positions squared, or get out all together. If one of these major banks was to require rescue by the Fed or the German or UK Central Bank, it would be far more damaging to world economies, and the rescue more costly, than to keep a lid on gold and allow the big commercial banks get out with survivable losses."

Taking a closer look at the Gold Derivatives Table published at the News & Views page (linked above), one can see that most of the reduction has occurred at J.P. Morgan which went from $30.5 billion 12/00 to $7.3 billion 12/01. I find this very interesting. That makes two out of the big three American gold derivatives' players showing a reduction to the $7 billion level.

Is it now Chase's turn in 2002 to move to the $7 billion level?

I think Doody's right. There holding the door open with derivatives in order to exit their carry trade positions or get the losses to a manageable level -- a workout as we have described many times before. And Chase may be the last to squeak through before the gold demand slams it shut.

This is the best evidence available why gold might be ready to explode. It's like holding a spring with your foot -- when you let go you'd better get out of the way.

Everywhere you look in gold's numbers -- derivatives, the LBMA, etc -- the numbers are telling us that the gold carry trade and mine lending are being unwound.

This is one of the most solid indicators I've seen in a long while why the knights and ladies at this Table might take heart - - Nay, not just take heart, but tip their flagons in celebration.

The battle is being carried, the war won.

-END-

It's certainly gritty in its detail, but I'm not hearing anything from him that I haven't also been hearing on the televised news -- CNN to cite an example.

In recent days I've received scathing e-mail from all sides, asking why we would dare muck up our website with this Jensen nonsense since he "clearly has a pro-Israeli bias" according to one visitor and he "is grossly sympathetic to Palestinians" according to yet another. I'll assume that it is either one of these two positions that have you frustrated, rather than his other Mideast regional commentary.

So, which of the two is Jensen's handicap, or can it be both at once? Can it be that some people unknowingly filter the same commentary according to their own predispositions on the subject, overlooking the commonalities while focusing instead on the contentions? And just as surely, there are some people who can be at peace with everything, overlooking the differences while paying heed only to the points that fall on "their side". Yet some other people are like willow trees, bending whatever what the last wind blew; thus changing their viewpoint according to the last thing they heard. Others stand their ground against all winds, while yet others run headlong into any wind from any direction, merely for the sake of bending to no outside counsel.

Within the parameters of this discussion forum, the many items I post here are for informational purposes -- wind from many directions. I leave it to each man to assess the weather and thus chart his own course according to his craft.

R.

What's going to happen? Nothing!

No earthly power can dictate to Israel. They will carry out their plans, or take down the whole world with them.

Please tell me I am completely mistaken!

Sierra

http://www.thelibertycommittee.org/icc_petition_online.htmAmerican Justice for Americans -- No International Criminal Court for Us
>
>
> April 4, 2002
>
>
> Dear friend of liberty,
>
> The International Criminal Court (ICC) will soon become a reality. The
United Nations will hold a celebration for their new world court on
Thursday, April 11, 2002 in New York and Rome.
>
> The International Criminal Court will claim judicial supremacy over the
United States and its people. We are asking President Bush to make it clear
to the International Criminal Court that the supreme law of our land is the
Constitution of the United States -- not the ICC. Rescinding the American
signature to the ICC treaty that former President Bill Clinton authorized
would clearly express that conviction.
>
> If you haven't signed the petition to President Bush, please do so now. We
are in the process of preparing the petitions for delivery to the White
House.
>
> Link to Petition:
http://www.thelibertycommittee.org/icc_petition_online.htm
>
> Also, please tell a few friends about this petition.
>
> If you are one of the 100,000-plus people who have already signed the
petition, thank you!
>
> Kent Snyder
> The Liberty Committee
> http://www.thelibertycommittee.org

Tireless Advocate of Gold and Liberty is at forefront again.....The Liberty Caucus
******************
Rep. Ron Paul
Chairman
*********
Texas
Rep. Roscoe G. Bartlett
Maryland
Rep. John J. Duncan, Jr.
Tennessee
Rep. Virgil Goode, Jr.
Virginia
Rep. John Hostettler
Indiana
Rep. Walter B. Jones, Jr.
North Carolina
Rep. Jack Kingston
Georgia
Rep. Butch Otter
Idaho
Rep. Richard W. Pombo
California
Rep. Denny Rehberg
Montana
Rep. Bob Schaffer
Colorado
Rep. John Shadegg
Arizona
Rep. Bob Stump
Arizona
Rep. Tom Tancredo
Colorado
Rep. Pat Toomey
Pennsylvania
Rep. Zach Wamp
Tennessee
Rep. Dave Weldon
Florida

Excerpt....-- wind from many directions. I leave it to each man to assess the weather and thus chart his own course according to his craft...........(TC)

Keep us informed of wind and it's directions. "All STORMS" start with a...... "Gentle Breeze"......YGM.

I had dinner at my best friends house last weekend. Hadn't seen him for a few weeks and asked him if he thought the economy had bottomed like the economists have said.

He looked at me kind of funny and said "Not Yet". I found out why a little later. His 25 year old daughter just got layed off last week, and his brother the week before. His daughter worked for the City and his brother worked in a support industry for telecom.

Trickle down effect from last year should start increasing lay-offs. Most of these will be (are) small companies and will not be picked up by the news media. Many companies in the Pacific NW held employees anticipating the "recovery", but now reality is setting in.

Second wave down won't be as noticable, but much more devastating to the economy.

Another real time economic flag. Our organization has had 3 burglaries in last two months. Hadn't had any for previous two years.

Should be at least a 3rd wave next year, but that will probably be banckrupsy related as the small businesses finally throw in the towel.

Tough times ahead as we know. I'll have a real good idea when reality really starts to kick in, because I work in retail auto, and we still can't find people willing to sell cars. Just as soon as I start seeing resumes come in for sales with Boeing, Lucent, etc. as previous employers, we'll be close to the bottom, or at least a lot closer. Until then, the ship (economy) is just taking on more water.

Pizz

I was friends in high school with Willie Wolf who was killed a few years later in a police shoot out in LA. He was in the house with the other members of the Symbonese Liberation Army when the (he was the one white guy that Patty Hearst fell in love with or was raped by depending on who you believe) police snipers shot it up and set fire to it. I also like you think they probably did the right thing. I was just stunned that the quiet very peaceful guy I knew ended up that way less than two years after we were playing tag in the yard together. Strange world sometimes.

From the cafe:
It's The Same Old Song?

It's The Same Old Song, brought to you by The Four Tops and The Gold Cartel. But is it? Maybe yes, maybe no. Chase was the massive seller today on Comex, pounding away at all those who dare be long gold in defiance of His Majesty's cabal and rigged market. The arrogant Gold Cartel has been seriously challenged and they don't like it, so they are doing what they always do � sell, sell, sell, to take gold back below $300 in order to quiet down the newly created excitement over the precious metals. They do so by mobilizing their resources, which means draining more of the west's central bank gold reserves.

It is the same modus operandi used over an over again the past many years. The only question is whether they will get away with it this time. Is the physical gold market so strong that their mobilized resources are inadequate to get the job done? Has The Gold Cartel been found out to such an extent that the big investment players of the world are going to take them on? My guess is that the answer to both those questions is YES!

We shall see and it may take weeks, but the feel of this gold market is much different than the ones of days gone by. Today's Comex gold close was certainly different than in past years as it finished $2 off the lows. In the past gold would have closed near the lows and below $300 after the kind of effort Chase put in today.

The day-to-day is practically impossible to predict, especially when one of our adversaries is the U.S. Government, but gold and silver could take off again at any time. That is why trading in and out is very dangerous. A move of a lifetime is upon us. It is not a time to be out of position.

Silver closed a $4.60/$4.64 gap on the May contract, finishing in the middle of that gap. A highly regarded silver local loves the silver close and the fact that the gap was not violated to the downside. His feeling is that some commercial silver shorts are going to cover fairly soon.

The U.S. economic news was dreadful this morning:

Washington, April 4 (Bloomberg) -- U.S. initial jobless claims surged last week to the highest level in four months, distorted by a new law permitting workers whose benefits had expired to apply for an extension.

State unemployment offices received 460,000 new applications last week, up 64,000 in the week that ended Saturday, the Labor Department said. A week earlier, initial claims rose by 20,000.

A thought for your consideration.....

How about a new campaign....one against the Bullion Banks and Market Manipulators

IF every time we hear of a particular group such as Chase today, we write to them as well as newssources etc

Further...if you have an account with them...demand answers and if need be close the account and let them know why very specifically

Yesterday in the post I made from the cafe, it was mentioned that Schwab was shorting gold stocks heavily yesterday...well Schwab is one of my brokers..as well as for my Mother's estate as well as two brothers

I got on the phone and demanded to know what the story was...I got moved up several times...I let them know that if I found out that THEY were doing the shorting ..first my account and then the others would be moved

They claimed if any shorting it was done on behalf of clients...I followed up with an e-mail to Jim Puplava...who was kind enough to answer confirming that his sources said it was Schwab shorting but they did not know if for their own account or clients.

I got follow-up calls from Schwab today to make sure I was a happy camper...they know I am disturbed but since no proof it was done for their own account...they said no,,,then for now the accounts stay

I think this approach could work if we all did it ...making sure that first your broker cannot use your shares to short...and then if you hear that your broker is negatively impacting...then raise a ruckus

Deal with ENVIRONMENTALLY FRIENDLY (GOLD!!!) banks...brokers...and raise cane with the others...very loud...wide ...and clear!!!!

Anybody who deals with Chase should call...e-mail etc your displeasure and let them know that you may be changing ...others can also write!!!!

Let's get going...we may be small...but lose enough accounts and it hurts some...and deprives them of funds to further their dirty work...DEAL WITH GOLD FRIENDLY BUSINESSES!!!

I call that country a Sovereign Power, which is run by its ruler or rulers as he or they see fit, whatever other countries may think of it.

I see only these Sovereign Powers in the world at the present time: China, North Korea, Iran, Iraq, Libya, Cuba, Syria, and of course, Israel.

I do not include the U.S. as a Sovereign Power. Nor any European power.

China is treated with kid gloves, for very good reasons: 1.3 billion Chinese plus nuclear weapons.

North Korea is treated gingerly, it also has nuclear weapons and a strong-willed government. It is classified as part of an "axis of evil", which includes Iran and Iraq, which have resisted being pushed around.

Libya does its own thing, but is quiet about it. Syria is also its own master. (seems to me)

Cuba belongs to Fidel, and no nonsense there.

And nobody, but nobody, tells Israel what to do or not do.

A showdown between these powers, would leave only Israel/U.S. and China. The others can be overcome by the U.S., with heavy losses, perhaps, but they can be levelled.

So that would leave Israel/U.S., against China.

That's the way I see it. Tell me I am all wrong, please! (I may be simplifying too much)

"Them as can, DO; them as can't, send envoys."

Facing the facts is disagreeable. I hope I am not sent to Siberia again, for this.

Sierra

Thanks for the ECB/euro/Gold drift posting ! Driving on Another's trail to the game park...but w're not there yet ! (smile slingshot). Regards, Belgian.

Oooh, I hope I'm not the one screaming 'are we there yet' in the back seat, my dad used to whack me for that one. "Shut up, you're driving me nuts, you'll know when we get there"

Anywho, I didn't mean to come across as wondering if anyone could predict any immediate radical changes, but just more or less a daily commentary of reasonable speculative analysis.
Like the example I provided of my opinion of what might transpire tomorrow and with reason if the curiosity is there. We could simply state that I don't think anything major is going to happen, but that leaves an idividual's statement open to definition of what major might be.

All I mean to say is that I often see cause before explaination, but I would enjoy also hearing explanation before cause. I think we have enough brain power in this forum to make educated speculations, but that is often something people wish to keep private for fear of being wrong, and having someone point it out.

My dear friend would you care to speculate what might happen with the price of gold by tomorrow's close? I gave my unsupported whim! I have reason, but very basic.


Cheers!

RobotGuy.

Thanks for the Roach article.

If he's right about a double-digit devaluation of the dollar, this should be a significant factor in raising the price of PMs especially gold.

Do your sources give a time-frame? I got into PMs several years ago thinking this was imminent but the amazing, levitating dollar has persisted in spite of all the fundamentals.

Saw your posts today.

My manager is Palestian, his family fled Israel in 1972. Almost each day I stop by his office for more info., more stories. He is obviously anti-Israeli and tries to re-count episodes in a neutral light but I feel his pain. He normally ends our conversations by expressing the horrors in that area as 'a way of being'. It has been a powder keg for a long, long time. The other day I asked him what was the root of all evil, his story mirrors your post earlier.

I have emailed your post to him, I hope that is okay.

Your other post regarding inflation is interesting. As interest rates have fallen in the last year and a half, closing down on gold borrowing costs I noticed gold began to rise. Inflation has been neglible (apparently?) so I wonder if inflation is the driving force. I tend to believe it is the spread between inflation and what one can earn in US treauries. Gibson's paradox, low and behold. I watch the Canadian Bond Index for the 'real return rate', presently at 3.70%. I wonder what 'inflation index' it uses? [ ;) ]

So if one is buried in government securities that are fighting to stay above water, ala closing spreads, and rising risks, would one, should one spread risk in gold?

We hear the ancient arguments of inflation/deflation being good/bad for gold which I now tend to believe is hogwash. Either can be good/bad depending what pays better, yes? Bonds at 15% while inflation is 15% (1980ish) is the same as bonds at 2.5% while inflation is 2.5% (2000ish). Now let's throw in a war, overvalued dollar, an increasing gold supply/demand deficit and ask yourself what 'spread' is tolerable?

So 'real inflation' is 5%, not the reported CPI 2% and bonds are hurting because the phoney SM is rising and what do you have, a negative spread, RED ALERT!! So now we have a theoretical rising SM, pushing bond yields up while the economy is not ready for rising interest rates, oh no! The SM cannot stand rising rates presently while inflation pressures stand ready to smash the entire recovery merciless, RED ALERT! RED ALERT!

Throw Bush in the mix not knowing whether to urinate or pull up his zipper, Morgan Stanley's CA crunch (thanks sector) and we have trouble. One really has to ask oneself, what is the stock market doing? Can you say the government(s) are now running the funny farm!!

I am almost finished reading the crooked nonsense during the 1980 silver bull at the CBOT and Comex, what a joke. The silver longs were jammed, cornered and near beaten. The commodities market is a scam. The stock market is a farce. Let's see, the DJIA has been flat at 10,000 for how many years now while every other 'indicator' has been beaten into an inert mass. Well let's 'manage' 30 stocks okay! Give me a break.

Let's see these buffons 'manage' the bond and currency markets. Gold is a tiny, tiny market, of course it's managed, it's linked to inflation and the dollar and a host of other tangibles. Let's manage this tiny entity so that the monster that we can't control looks like it's under control, good idea, eh?

Why does government mess with stuff they don't fathom? They meddle and tinker and soon they are over their heads. Now we have this monstrosity of a mess that is unmanageable.

http://groong.usc.edu/fisk.html" 'WHO NOW remembers the Armenians?' Hitler asked, just before he embarked on the destruction of European Jewry. Precious few, it seems. As the memorial day for the Nazi genocide against the Jews was proclaimed by Mr Blair this
week, there was not a single reference to the slaughter of one and a half million Armenian Christians by the Ottoman Turks in 1915. The world's first holocaust - and Hitler's inspiration for the slaughter of the Jews - was ignored."

Not to throw water on your idea, but no one can predict accurately over the short term. So why try?

Day to day or even week to week price predictions are an exercise in futility. Way too many variables. You can both be right, for all the wrong reasons, or wrong, for all the right reasons or anywhere in between. Every once in a while a psychic, astrologer, or market advisor gets lucky like a crap player who makes 15 or 20 passes once or twice in a life time. If they're smart they'll write a book or start a subscription service and cash in quick. Ever wonder why if these people are so good, why do they have to take the time to write a book or advise others? Out of the goodness of their heart.?

It's hard enough trying to figure out which way the macro tides are running. Stock's APPEAR to be overvalued based upon everthing I have absorbed from many areas and gold and silver APPEAR to be undervalued. We are also printing more fiat than we are mining metals. EVERYTHING can change tomorrow morning, and probably will, somewhere.

Any day to day speculation also encourages people to trade, and that's gambling in my book. It will do more harm than good to those who try, IMHO. Many very intellegent people have tried and failed to beat the markets consistantly and failed. Intelligence is to wisdom as fiat is to wealth. I'd rather be a wise gold holder than a smart speculator.

Pizz

From CNN Money Watch:

Gold Aims to Recapture Its Lustre as a Safe Hedge
in Troubled Times
Source: Knight Ridder/Tribune Business News
Publication date: 2002-04-03


Apr. 3--After years of playing the part of Cinderella to
other more-favoured financial assets, gold is finally
shaking off its dowdy image and taking a shot at gaining
the prize for best-performing asset market of 2002.

Since 1997, $300 (UKpound 208) an ounce has been a ceiling
for gold as a combination of central bank auctions and
lending to hedge funds, forward sales by gold producers
and the much-touted death of inflation conspired to keep
the price well below its historic high of $870 hit in
1980.

To those gold bugs who have never given up hope that
this once lauded store of value would again take its
rightful place in the pantheon of credible financial instruments, the poor performance of the commodity
has been nothing short of a conspiracy.

Indeed, according to many gold aficionados, particularly
those at the Gold Anti-Trust Action Committee, the US
Federal Reserve, the US Treasury and European central
banks, in league with major US investment banks, have
conspired to keep the price of gold low.

Gold broke through the $300 level to reach a two-year
high of $307.80 on 8 February. But the move did not last
long, and as the price drifted off German Bundesbank
President Ernst Welteke conveniently speculated that
Germany might at some stage start selling gold. The
timing of his statement was seen by many as an attempt
by the central banks to ensure the price of the commodity remained capped below $300. However, the price has
since rebounded, trading back above the key $300 level
last week.

The latest rebound has been driven by new-found interest
from the hedge funds, many of whom are betting that
persistent selling by large investment banks to keep
the price down, and central bank comments to achieve
the same end, will ultimately fail to cap the upward
trend.

Indeed, the talk now is that this so-called cartel is
about to get its come-uppance, with some gold optimists suggesting gold may hit $600 or even $1000 an ounce.

The Enron scandal has brought to the fore the issue of
cartels and especially the role of so-called bullion
banks that reportedly have very large short positions
in gold via the derivatives market. These are now being
squeezed as the price of the commodity rises. Indeed,
there is wildfire speculation among some US gold
watchers that if the price of gold moves even $20-$30
higher we are going to see these shorts getting hammered.

There are plenty of other reasons why gold and gold-related stocks are worth serious consideration. As well as Enron,
the markets also have to contend with Argentina's debt
default and the huge bankruptcy cases of US companies.

Another factor favouring gold is the quadrupling of
purchases of bullion by Japanese consumers worried about
the safety of their bank deposits. Also, investors in
the Middle East have started to actively purchase the
metal as tensions over Iraq, Israel and Palestine mount.

Finally the all-powerful US dollar, which has held up
remarkably well in the face of a weaker US economy,
evaporating corporate profits and heightened worries
over the threat from terrorism, may be set for a downturn,
which usually means higher gold prices.

Against this backdrop there is a genuine case for thinking
that gold provides an attractive hedge against financial
and political stress.

However, gold has to become more than just an icon of
gold bugs, conspiracy theorists and short-term speculators. Instead it needs to broaden its appeal as an asset among mainstream investors anxious to protect themselves in an increasingly uncertain financial and political environment

I thank you anyway, however, I think your accolades should be directed toward our host MK. As it was his post about the "disappearing" Gold derivatives. Cheers!

- Black Blade

BTW, how's the economic "container indicator" these days?

Not patronizing the brokers would probably not hurt them that much (it would, however, make you feel better). Consider this instead -- in most brokerage accounts your shares can be used by others for shorting. If memory serves me, the shorting party need not even be at the same brokerage house. (I do not know if shares held in a retirement account can be used for shorting -- that is a point that I have been meaning to research.) What I might suggest is that owners of shares in mining companies place those shares in a situation where they cannot be used for shorting. One way of doing this is to take posession of the stock certificates (This is what I have done for our non-retirement account). It is a pain, but you then know that your shares are not being used against you. In my case, it has also helped temper the desire to sell on every little bump.

Cause before ExplainationIf cause before explaination is simular to cause and effect,why not. Gold should close at $298-$299.
I'm getting use to the ups and downs. There may have been some sabre rattling but nothing unusual. The ME tension has a messenger on the way and Hope has filled a void for the time being.The news of Argentina and Japan has run its course and even A. Anderson is beginning to go to the back burner. The media has turned its eye to the Catholic church and its doing and the masses are lulled into a sense of security. The demand for gold has eased as some now want to wait and see what happens next so I would expect a slight down turn but not to break the support level.
Slingshot

I've gotta be quick with this or I may not get it out today at all, but HOW could they disappear without driving the price back up?

Only thing I can think of is options, which, if you can get enough time to go by, can expire out of the money. Those meanwhile might have shown up at great nominal value, but not much actual profit with small premiums.

Shorts, and (I think) swaps, require actual buying (or paybacks) to cover, right? Equal effect on the other end. So where do the derivs go?

You can't postulate a mountain of derivatives driving AU down from 500 to 270, and covering most of it sends it only back up to 300???????

If some dumb turkey Enron-style was found to take the other side from these banks, then they had to fork over some real cash to do it, or these banks wouldn't be off the hook, would they?

Help me with the disproportionalities here, willya?

Let us not forget the Ukranians during the Stalin era and the Irish in the mid-19th century. Many Greeks were slaughtered by the Turks as well.

Then again if you want to discuss holocaust the we can't leave out the American Indian. There was a US governmnet policy of genocide. The US government even went as far as using biological weapons (small pox infected blankets). We in the US are certainly not blameless when it comes to genocide.

- Black Blade

Excellent question. . . .Options do not have to be covered. They can expire worthless. As such, for the so-called "cabal", they are a cost of doing business -- always have been . Q. What the business? A. The gold carry trade.

This is for those of you who may be looking for a way to profit in the paper markets. (probably best off just skipping this one over) First you have to make it so you dont have the tendency to lose money over and over. Next you must take money out of your winning posotions, with still keeping them. Those are the two principles for this idea. OK example. You have to enter you positions with a straddle (A put and call) Gold is at 300, buy a 305 call. Then buy a 295 put. Lets say you are bullish, even with the market rigged, for the purpose of how to take profits and keep from losing money, I need to clarify this is for the bullish position. For the profit strategy is different if you are bearish. Now if the position drops to say 295. You keep your 305 call sell your 295 put (may need to drop a bit below 295 I realize) for double what you paid for it. OK so you sell the 295 put you own and buy a 290 put and a 300 call. Now you own a 305 and 300 call and a 290 put. With no loss even though the market went against you, your put profit is in another put and a call. Now say it falls to 290 (or a bit below). Sell your 290 put once again. Keep your 305 and 300 calls and add another 295 call and a 285 put. You now own a 305,300,&295 calls and one 285 put. Now see you are ready for a spike. Just do it that way incase you are wrong about being bullish in paper.-------
Now what do you do if the market goes up when you enter you initial posotion. Think about it and you can come up with a strategy. If you make a killing with this technique you can buy me gold here at CPM and let me know. Personally I cannot trade. I am 28 and have a mess of a tax problem, and no credit. I have studied for 8 years (While commercial fishing) and 3 times lost my trading account. So carefull taking this advise!! ahahah. Not kiddin though, I bet that works very well. I should have listened better to Sir Trail Guide back in those ol days. With this technique I believe I would have been fine however. If you see any holes in this let me know if you would. Thanks

Mr. GreshamOne could also ask; "Who now remembers the Orthodox"? Orthodox Christians have been murdered by the tens of millions in the 20th century. Most of the Armenians you refer to are counted among those numbers. The horrors of Nazi Germany were far eclipsed in these many slaughters. She is called "the Church of martyrs" for good reason.

Black Blade: Thanks and cheers!

http://www.forbes.com/work/managementtrends/newswire/2002/04/04/rtr559047.htmlLONDON, April 4 (Reuters) - World supply of mined gold may plummet by nearly 30 percent by 2010 unless bullion prices rally and prompt miners to bring untapped deposits on stream, a mining study showed on Thursday.

Toronto-based mining investment banking and research firm Beacon Group Advisors forecast global gold output falling this year for the first time in two decades, reflecting years of low prices and slashed exploration budgets.

Supplies should continue to fall, with the decline accelerating after 2006 as output dropped from mature mines in the United States and Canada.

"A gold price above $325 is needed to prevent the decline," Beacon Group managing director Don MacLean told a mining conference where the study was presented.

The findings are likely to encourage gold market bulls who see the prospect of reduced mine supply driving prices above $300 a troy ounce, where bullion has been capped for most of the past two years.
end of article.......
***********************************************************
During the early-mid 1990's the "accepted" and often quoted mining "break even" $$ price of GOLD was accepted as $325. Any price below this point was considered a bargain for us physical buyers. As the "new economy" madness ensued this price "evolved" into $275...well folks it's time for the wake up call here....the GOLD bear days are gone and any opportunity to accumulate at below $300 are numbered (if not already past)...
I will state for the record;
Soon we will most certainly see the return to the $325 "break even" price..any accumulation of PHYSICAL GOLD BELOW THIS PRICE WILL BE PERCIEVED AS A BARGAIN...funny how reality seems to change...kind of like "pro forma " earnings..al� "spin"..

Hey Waverider,

Do we know how much of the Arab 2.4 trillion is in the Dow or the Nasdaq? How many total foreign and domestic dollars are in the Dow and the Nasdaq?

http://www.amazon.com/exec/obidos/ASIN/087558070X/qid=1017973329/sr=8-1/ref=sr_8_3_1/104-6439043-4675136No, it wasn't a specific group of victims I was after. It is honoring ALL of them, by honoring the slogan "Never again", to which I fully subscribe. To anyone -- anywhere. The details may be sticky (especially in this instance) but the principle still holds. And re-asserts itself in just about every news headline each day.

Gandhi and King were on to something, and anyone who does not take their movements into consideration is shearing off the possibilities of better outcomes for the people they seek to help or liberate. Palestinians of all people should have been commended to this path, but I understand the difficulties they would have had in wholeheartedly adopting it. And, yet, what has been their outcome in the alternative?

BB: There was a guy named Chivington, up Denver way, whose men rode through the streets of Denver with the anatomical evidences -- too gross too detail here -- of their slaughter at Sand Creek skewered on the ends of their swords ("Bury My Heart at Wounded Knee" -- Dee Brown). That is one that was demonically inspired, I am sure, and makes me embarrassed to admit Anglo-Saxon heritage in common with these savages.

I think the smallpox blankets were the British during the 1763 war, but it was probably tried elsewhere by U.S. later (Sherman?). There's enough shame to go around...

Hey -- I believe in Black reparations, too. (So -- shoot me, fellas) -- I believe every descendant of a Black slave would be entitled to about $20,000 (back of the envelope) in a fair court settlement for denied wages. Clear conscience knows no price tag, true, but at least it's not an infinite one. It's just a message -- Don't do it again!

Howe files motion for more proceedings in
suit against BIS and U.S. government:

http://groups.yahoo.com/group/gata/message/1072

To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
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http://groups.yahoo.com/group/gata/message/1072Reg Howe files motion for more proceedings in
his lawsuit against the BIS and U.S. government.


To subscribe to GATA's dispatches
by email and get them immediately so
you don't have to go look for them,
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Thanks for the insight into the Charlie Whitman situation. I was quite young at the time and never understood exactly what happened. I lost my first wife to a brain tumor so can understand what might have transformed him. Thanks again.

http://groups.yahoo.com/group/gata/message/1073GATA cracks U.S. news media blackout on
the gold price suppression scheme.


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by email and get them immediately so
you don't have to go look for them,
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gata-subscribe@yahoogroups.com

Read your post about Schwab and the shorts. I too have lots of gold stocks at their place so I call. Well I never heard a man studder so much. Can you belive that he said it must have been Mr. Schwab who was shorting.Well I got no place with him but it is after hours.
Question do you have any more info cause I will find a gold friendly place spend my money?
Live small.
RJ

Warning- post content concerns paper trading
Rockgrabber, I've often used your straddle opinion idea but think of buying both the call and put at the money, then sell whichever increases enough to cover the costs of two more (again one call and one put and again with the same market current at-the-money strike price). If the market is volatile enough the number of held options will increase with no more than the inital investment. A good size reversal profits on the larger number of options (puts or calls) accumulated. Buying more time (further out months until option expiration) as you accumulate increases the time frame.
This has not worked well in the gold market over the years because big moves in both directions are needed, along with discount commission rates, for this to work.
I've used it in copper, selling one leg of the straddle and then initiating another full straddle on every 2-3 cent move. With 3-4 cent moves another month's time can be included in the deal. Without price movement, the options loss value quickly with the passage of time.

Mr Gresham, if the large derivative positions in the gold market were from options sold then the sellers exposure to those would decrease with time. Options are time wasting assets for the buyer. So, by discontinuing the sales, the potential exposure (for the sellers) simply fades away with time. Also, I can not understand how anyone can even estimate the true potential exposure of Goldman or anyone since futures or options sold can be covered or the potential losses limited with other strategies. It gets incredibly complicated. Risky? Yes! Complicated Yes! Dangerous? Absolutely! How complicated? Risk in short deverative positions in gold or silver might be somewhat or even completely offset by long positions in the XAU index!
I am very suspect of any figures concerning anyone's position, even outright OTC sales as there are so many ways to offset risk. This does not eliminate risk, it offsets or transfers it. I consider my knowledge as barely adequate to play the game so please question my supposins but I'm supposin that the ever fluxuating derivative exposure may have been reduced with the time wasting nature of sold options and reduced through offsetting strategies. Perhaps there is a formula for how many Drooy shares must be bought to counter the potential loss for every sold call or future, with more Drooys bought for every dollar increase in POG after the options' strike price has been exceeded. Perhaps the potential losses have been limited with bought calls with higher strike prices? Perhaps the potential gain from every ten Drooy shares covers the spread between the short options potential loss up to the point (POG) where the loss is covered with options held at a higher srike price. My point is to express the complexity of the situation. Perhaps absurd but part of the puzzle nonetheless.
If they have greatly lowered the exposure, it has not been done without cost other than those that have lost value due to the passage of time. Sorry for talking shop here but it's an essential part of the question. It's the money management part of the game.
Rich

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=140200

By OGJ editors

HOUSTON, Apr. 4 -- Energy futures prices regressed Wednesday as international markets adjusted from earlier spikes this week. The May contract for benchmark US sweet, light crudes dropped 15� to $27.56/bbl on the New York Mercantile Exchange, while the June position lost 18� to $27.66/bbl. However, both rebounded in after-hours electronic trading to $27.65/bbl and $27.76/bbl, respectively.

Unleaded gasoline for May delivery fell 2.14� to 84.84�/gal, wiping out the previous day's gain of 2.08�. Natural gas for the same month was rolled back 14.8� to $3.51/Mcf, nullifying Tuesday's gain of 12.3�. The May heating oil contract dipped 0.12� to 70.83�/gal on the NYMEX.

The American Gas Association reported early Wednesday an unexpectedly heavy withdrawal of 65 bcf of natural gas from US underground storage last week, compared with drawdowns of 69 bcf the previous week and 51 bcf during the same period a year ago. That ended the traditional winter withdrawal season with a little more than 1.4 tcf of gas still in storage, up 804 bcf from last year. "We now expect storage levels entering next winter at the beginning of November to be at 3-3.1 tcf, based on an expected 2% year-over-year decline in domestic natural gas production," with a projected growth of 2.9% in the US gross domestic product, said Robert Morris of Salomon Smith Barney Inc. That economic growth should increase US demand for natural gas by an additional 1.75 bcfd, or 3%, this year, Morris reported Thursday.


Black Blade: Of course growth projections for natural gas are based on continuing production. The decline in natural gas will only accelerate as fewer drill rigs explore and produce natural gas. Decline rates have been accelerating as these producing fields age and reserves are not being replenished. Storage withdrawal rates are still higher than year ago levels. Meanwhile the situation in the Middle East continues to deteriorate and threatens to spread to other regions. Thankfully the US is in an economic recession as we would be heading into another "energy crisis" that we are not prepared for (dodged another bullet?).

Carry trade included in derivative number? I wonder if the large amount of gold, leased and sold over many years which is the true unwindable position is being included in the derivative exposure numbers?
If so, I'll echo your question. This gold carry trade gold has warped the supply/demand equation for these many years, I can't see how it could possibly be bought back without POG going into orbit.
Again, this leasing, carry-trade-created huge short position sets gold and silver apart as unique from all other commodities. This is said in reference to the manner in which they are traded. That gold and silver are money also clouds the issue, no?
Rich

Or how my brother got hosed trying to outsmart the big boys in goldI must remember that some people actually can make money in the futures and options trade.

It's just that I swore an oath never to even try. Maybe I lost a fortune in doing so.

This gold trading thing is not as simple as the Elliot wavers would have you believe. My brother, a university associate professor, sent me all the pamphlets...he did all the due diligence. In the end he had kids and his priorities changed. He never did make too much money at it.

The point is that there are hundreds of very savvy Fed economists who have unlimited funds and time to set you up for failure in this manipulated COMEX market.

You win by being long gold with money you don't need.

Cutely trading in and out is needlessly risky in my view. The upside is 10X physical...just as it was in 1971. Maybe more now.

GATA and a small army of dedicated soldiers have exposed the truth that the Treasury is running a bit short of ammunition these days and that big, long players across the globe are now offsetting the cabal's past strength.

Swinging for the fences with paper options and COMEX futures just isn't necessary. The authorities can change the COMEX rules whenever they please. Ask the Pt players on the TOCOM. They may be getting close to yet another default in Platinum.

I have some physical. I don't calculate how much it's worth today vs. what I paid...I don't care now. It's in the future that I will care...when eyes will pop as I bring them out. I also have some unhedged miners...they manufacture and distribute actual "money". They are the JPMs of the future.

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

Gold sets standard in Japan
By Bayan Rahman in Tokyo
Published: April 3 2002 21:56 | Last Updated: April 3 2002 22:03



Concern about the Japanese economy, the state of the country's banks and now unease about tensions in the Middle East are continuing to send the Japanese public to their nearest gold shop to stock up on the precious metal.

Japanese households bought Y24bn ($180m) of gold in February, according to JP Morgan, and gold imports increased more than seven times from February 2001 to almost 20,000kg.

"It is certainly possible that a rise in demand for gold bars in Japan raised the international price of gold in February," said Masaaki Kanno, economist At JP Morgan. "The estimated purchase of gold in January and February is only 0.2 per cent of annual savings by the household sector. This implies that the impact of a change in Japanese householders' investment can be so big that it could affect the global market prices of financial assets."

Tanaka Kikinzoku Kogyo, Japan's leading retailer of gold bullion, reported a nine-fold year-on-year increase in retail sales in February, while Mitsubishi Materials, Japan's biggest non-ferrous metals maker, saw sales surge to 13 times last year's level.

Concerns about the health of Japanese banks, believed to hold large portfolios of non-performing loans, run deep, even though speculation about an impending financial crisis in March was proved wrong.

But talk of a "March crisis" saw many Japanese shift their money from bank deposit accounts into gold and other assets. Gold sales were also spurred by the government's decision to lift the guarantee on bank time- deposits of more than Y10m from April 1.

Although that deadline has now passed, the guarantee will be lifted from other types of bank accounts in April next year, leaving Japanese savers still fearful for their life savings.

The Financial Services Agency's report on its special inspection of the banks' non-performing loans, due out this month, is likely to deepen concern about the banks.

Meanwhile, Japanese corporations will begin to report their annual results, which are expected to reflect the bleak economic environment, from next month.

"Gold sales are still much higher than last year and that's because of the state of the economy and the banks. May and June could be another panic point that could trigger another big surge in sales," said Yoshihiro Matsumoto, head of the gold retail group at Mitsubishi Materials.

The price of gold futures has surged in Tokyo recently on fears that the Arab-Israeli conflict and tensions between the US and Iraq could spill into a bigger regional war, but retail investors continue to buy. "Usually the Japanese don't buy when the price goes up, but this time it's different," said Mr Matsumoto.

A broker at one of Japan's leading general trading companies said she expected gold retail sales to increase if the price fell even slightly. "The public are holding long positions in gold and enjoying the surge in prices.

"If prices fall, brokers and short-term traders will sell but the public will buy."

There is anecdotal evidence that Japanese investors are buying gold futures and other commodities, such as platinum. Platinum futures surged yesterday, sending the spot platinum price above $540 an ounce for the first time since July.

"It's calmed down since February's peak, when we had crazy sales. But even now people come in with tens of millions of yen and take several kilos of gold bars home with them," said Mr Matsumoto.

Could this be possible:

Leased Gold = Mine Hedge Books??

Senario: Lease gold with a bank guarantee, sell gold, invest most of fiat, and buy forward contracts on margin with rest of fiat from hedge miners as insurance.

If you own the forward contract you do not have to sell, you can demand delivery.

Could our hedged miners be in a position where they can't cover directly and they are just going to have to deliver?

Who did the leasing? Enron partnership type entities set up for the sole purpose of controlling gold's price? Nice scam but the monkey wrench could have been 911 and mid east war. Even if gold spikes, it's the mines that get hurt, not the banks or leasers. Hmmmm...

Makes sense to me from a sort of conspiratorial mind set.

Pizz

http://www.yiddishbookcenter.org/story.php?n=6I forgot before, in the heat of the post, but one of history's delicious ironies (to me) is that the National Yiddish Book Center, founded by Aaron Lansky & friends driving around the East in a beat-up van rescuing books, and a dying culture, is now located in a beautiful new library in the town named after the English commander who sent the Indians the smallpox blankets in the hopes of exterminating them.

*** Regarding those straddle ideas. I have not fared so well in the past trying to short the stock market. I think any trading in any market for me in the future will (unless I find out it does not work for yet another unforseen occurance) include the use of the straddle technique.*****



If for nothing else having played in these markets has taught just what a mess they have created in the paper gold market. Many people who yeild the mighty power of wealth are rats and not to be trusted. Their interest does not look for your best. All they have to do is sell all the paper it takes to hold prices to wherever they wish. I am sure it wont be to long untill for some strange reason the premiums on physical gold rise. As a "temporary" physical shortage hits the markets. It wont be temporary most likely however. The paper players may never see the gains, and if they do they will be in dollars. I have to say the best reading I have ever just happened to come across has been here on this page ("The Gold Trail"). Gold in Hand looks better and better all the time.

$$Man I wish I could buy you a Negro Mendelo my freind. It sure is easy when all I have to do is come here and get all the great relavent stories you have found and posted. I bet you are a great guy to twist one up with. The pleasures that others must have had in your company at those times I am sure is super. I by the way loved the ant and grasshopper analogy. I live here in California (sorry). Its amazing what little brats are driving around on these roads here. Big Suburbans, BMW's, decked out trucks with motorbikes in the back. Peircings and scribble marks all over their bodys. They pay attention to not a thing, and this lifestyle the feel they deserve? I am definitly not going to cry for these folks I am sorry to say. Thank you for your efferts good sir. Cheers. $$


Sorry for the jibber folks. Wanted to let Mr. Black Blade know he is much appreciated in my eyes.

It would appear that the Brits also may have engaged in the American Indian Genocide. Lord Jeffrey Amherst commanding general of British forces in North America during the final battles of the so-called French & Indian war (1754-1763) apparently wrote of using small pox to "inoculate the vermine". These stories are reported, for example, in Carl Waldman's Atlas of the North American Indian [NY: Facts on File, 1985]. Waldman writes, in reference to a siege of Fort Pitt (Pittsburgh) by Chief Pontiac's forces during the summer of 1763:

... Captain Simeon Ecuyer had bought time by sending smallpox-infected blankets and handkerchiefs to the Indians surrounding the fort -- an early example of biological warfare -- which started an epidemic among them. Amherst himself had encouraged this tactic in a letter to Ecuyer. [p. 108]


Other sources:

See Ann F. Ramenofsky, Vectors of Death: The Archaeology of European Contact (Albuquerque, NM: University of New Mexico Press, 1987):

Among Class I agents, Variola major holds a unique position. Although the virus is most frequently transmitted through droplet infection, it can survive for a number of years outside human hosts in a dried state (Downie 1967; Upham 1986). As a consequence, Variola major can be transmitted through contaminated articles such as clothing or blankets (Dixon 1962). In the nineteenth century, the U.S. Army sent contaminated blankets to Native Americans, especially Plains groups, to control the Indian problem (Stearn and Stearn 1945). [p. 148]

The use of small pox as germ warfare was also used by the US Army against the Cheyenne and earlier against the Cherokee under orders from President Andrew Jackson.

See also Robert L. O'Connell, Of Arms and Men: A History of War, Weapons, and Aggression (NY and Oxford: Oxford University Press, 1989):

Marking a milestone of sorts, certain colonists during the French and Indian Wars resorted to trading smallpox-contaminated blankets to local tribes with immediate and devastating results. While infected carcasses had long been catapulted into besieged cities, this seems to be the first time a known weakness in the immunity structure of an adversary population was deliberately exploited with a weapons response. [p. 171]

Anyway, it's all water under the bridge. We certainly don't live in a perfect world. Cheers!

- Black Blade

Why thank you. I used to live for a time in Hayward, Castro Valley, and (Gulp) Escondido many years ago. In many ways it was very nice, and in other ways I felt as though the inmates were running the asylum. Still, I have relatives and several friends living there. Two cousins in LA who are lawyers (one is even a "Jewish lawyer" in the Entertainment biz - as he constantly reminds me), and another is a Moravian minister in Oakland. Even so, I do have fond memories of how life used to be in "Kalifornia". Cheers!

- Black Blade

http://www.hussman.com/hussman/html/datapage.htm"Do we know how much of the Arab 2.4 trillion is in the Dow or the Nasdaq? How many total foreign and domestic dollars are in the Dow and the Nasdaq?"

I don't know, nor do I know where one could find that information...maybe someone else here does? I think the Arabs are even guessing the 2.4 trillion figure in expatriated funds. I've seen a number of estimates suggested in the various Arab economic websites I've bookmarked.

You may find the above link of interest - good raw economic data. Check out the "Federal Debt Held by Foreign Investors" and the "US Balance on Current Accounts" - interesting given the article that Sector posted earlier today. Hope that helps at least a little. Cheers,

Waverider

http://www.forbes.com/work/managementtrends/newswire/2002/04/04/rtr559047.html
Snippit:

LONDON, April 4 (Reuters) - World supply of mined gold may plummet by nearly 30 percent by 2010 unless bullion prices rally and prompt miners to bring untapped deposits on stream, a mining study showed on Thursday.

Toronto-based mining investment banking and research firm Beacon Group Advisors forecast global gold output falling this year for the first time in two decades, reflecting years of low prices and slashed exploration budgets.

Supplies should continue to fall, with the decline accelerating after 2006 as output dropped from mature mines in the United States and Canada. "A gold price above $325 is needed to prevent the decline," Beacon Group managing director Don MacLean told a mining conference where the study was presented.


Black Blade: There hasn't been any significant exploration for about 6 years in the US. I am sure that this corresponds to most mining companies worldwide. Within the next couple of years we should see many large mines run out of reserves and go on "care and maintenance". It takes a minimum of 5 years from permitting to even begin mining. Mine supply will run short very soon and it will be years before any new supply comes to market.

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=APK0QyBTcSmFwYW4n
Tokyo, April 5 (Bloomberg) -- The Japanese government's debt collecting agency has 20 officers trained in martial arts and small arms, a vital skill when much of the $33 billion it aims to recover was lent to yakuza gangsters.
----------------
The need for action is getting more urgent, investors say. This year, an average of 55 companies are going bankrupt each day, defaulting on loans whose collateral is often backed by real estate. Last year, land prices fell an average 5.9 percent, the fastest pace in nine years.

Still, Japan's ruling Liberal Democratic Party, which has been in power for all but 10 months of the past 50 years, doesn't seem to want to expand the agency's role. It's betting eventual recovery of the economy will help creditors meet payments and reduce the level of non-performing loans, which Goldman estimates to total 237 trillion yen, or 39 percent of all bank lending.

``There is no need to rush the disposal of non-performing loans as any gain in land prices or the stock market would help clear a significant portion of Japan's bad debt problem,'' LDP policy chief Taro Aso said last month.

http://www.suntimes.com/output/business/cst-fin-wall04.html
Snippit:

NEW YORK--Wall Street shed 43,300 jobs in the year ending in February, marking the biggest cuts in more than 25 years. The firing spree may not be over. Credit Suisse First Boston's John Mack, Goldman Sachs Group Inc.'s Henry Paulson and other chief executives of securities firms are finding they still have too many employees given that mergers plunged by two thirds last quarter and stock sales slumped 15 percent, corporate recruiters say. ''Every firm has a list for the next wave,'' said Henry Higdon, chairman of New York-based recruiting firm Higdon Group.

Merrill Lynch & Co. has cut the most jobs, shedding about 9,000 positions in the fourth quarter, while Morgan Stanley Dean Witter & Co. eliminated 3,800 jobs in the year ending in February. More cuts have occurred since then. Credit Suisse First Boston said Tuesday it fired 300 investment bankers. Goldman Sachs Group Inc. last month said more layoffs are coming.


Black Blade: Of course the reason for so many firings was due to the 1973-1974 recession triggered by the 1973 Arab Oil Embargo. Many Wall Street pimps continue to deny that there ever was a recession this last year. I suppose that the expected recession is yet to come � perhaps these Wall Street institutions are firing people because they know what is coming. Obviously they do not expect business to pick up anytime soon.

http://www.gaytan.org/lyrics/my_sharona.txtWhere are the great old lyricists of yesteryear? Was it Goldfan or Goldhunter? Forgive me, whoever is still up, but I can't go to bed till I inflict this upon you...

MY SHARONA
- written by Doug Fieger and Berton Avarre
- as recorded by The Knack
- reached #1 in 1979 {great year for gold!}

Ooh, my little pretty one, my pretty one
When you gonna give me some time, Sharona
Ooh, you make my motor run, my motor run
Tanks are comin' over the line, Sharona

Never gonna stop, or give it up, now their dirt is mine;
I always get it up for the touch of that Palestine.
My, my, my, aye-aye, whoa!
M-m-m-my Sharona

Come a little closer, huh, a-will ya, huh?
Close enough to look in my eyes, Sharona
Whoa! That's close enough! Now I see, yes I see
Mushroom cloud risin' up in the skies, Sharona

Never gonna stop, give it up, ...

When you gonna give to me, a gift to me
Is it just a matter of time, Sharona?
Standing trial with Slobodan, Slobodan
In the wars you ordered those crimes, Sharona?

Never gonna stop, give it up, ...

http://www.latimes.com/business/la-000023971apr04.story?coll=la%2Dheadlines%2DbusinessAccounting Rules Regulations: Companies may have more time before they must add some off-balance-sheet financing to the books.

Snippit:

Accounting rule makers may delay tougher new guidelines for the financing vehicles used by Enron Corp. to hide debts. The delay may allow many companies more time before adding costly liabilities to their books.

The Financial Accounting Standards Board said Wednesday that it may phase in the change for certain existing entities used to finance property purchases. For new entities, however, the rules probably will take effect by August. FASB Chairman Edmund Jenkins previously said the rules would take effect for all companies by year's end.

The biggest effect of the proposed changes would be on thousands of companies that financed property using so-called synthetic leases. Those firms would have to begin including that debt on their balance sheets. The change could add an estimated $100 billion in debt to corporate balance sheets, analysts said.


Black Blade: In other words � It's still legal to "cook the books".

http://www.financialsense.com/editorials/barron.htmStraight Talk on Mining
February 16, 2002

Snippit:

What a week it has been! There have been numerous reports for the last two weeks of the Japanese piling into the yellow metal, in advance of the March 31st cap on bank deposit insurance. Those who watched ABC Evening News in the USA tonight were treated to the spectacle of Japanese housewives buying kilo bars to protect the family savings. Let me say that again just in case you can't believe your eyes. Yes, they were buying gold bars - not US Dollars - GOLD BARS, and it was on mainstream media T.V. at prime time. This wasn't like the Argentines lined up to sell pesos for dollars as we've seen on the news recently. The Japanese have substantial savings socked away, and they're sinking it into gold. The commentator talked about a possible debt implosion that could rock America if substantial holdings of American bonds and equities are liquidated.

Monday, the Japanese market was closed; other Asian markets were closed for several days this week. On Monday morning, Prudential Securities analyst John Tumazos chopped his target for Newmont Mining Corp. by more than half, and moved his rating to "sell" from "hold". This was trumpeted by Bubblevision on a half-hourly basis the whole day, beating the gold price down from a two-year high. On Tuesday, Bloomberg News blamed the preceding day's fall in the gold price "on expectations that a 6% surge in prices last week will curb demand from jewelers".


Black Blade: An older article worth reviewing. Yes indeed, the mines are closing � and they are not being replaced. In fact large miners aren't exploring, but rather are buying up smaller operators. This can't go on forever. At some point the Gold runs out. Then � Blast Off!!!

Good article

http://biz.yahoo.com/rb/020404/enron_lawsuit_1.htmlQuote
HOUSTON (Reuters) - At least six investment banks and two law firms that advised Enron Corp. (ENRNQ - news) and auditor Andersen will be added to a huge shareholder class action suit over the bankrupt energy trader's collapse, sources close to the case said on Thursday.
The banks and law firms will be named in an amended complaint set to be filed on Monday, two sources told Reuters. If the plaintiffs are successful, the suit could have potentially destructive consequences for Wall Street if they are found to be liable.
The suit will name investment banks Merrill Lynch & Co. (MER - news), Deutsche Bank AG (DBKGn.DE), J.P. Morgan Chase (JPM - news) and Credit Suisse First Boston (CSGZn.VX), Citigroup (C - news), Barclays Bank Plc (quote from Yahoo! UK & Ireland: BARC.L), law firms Vinson & Elkins, Enron's Houston-based outside counsel, and Andersen lawyers Kirkland & Ellis of Chicago, the sources said.
UnQuote

Stormy weather in perspective.

http://www.globeandmail.com/servlet/RTGAMArticleHTMLTemplate/D/20020404/wedit0404?hub=homeBN&tf=tgam%252Frealtime%252Ffullstory.html&cf=tgam/realtime/config-neutral&vg=BigAdVariableGenerator&slug=wedit0404&date=20020404&archive=RTGAM&site=Front&ad_page_name=breakingnews
And the gold cup goes to ...

Snippit:

London � An extremely rare gold Bronze Age cup has been found by an amateur treasure hunter � only the second such discovery in Britain, archeologists said Thursday.

The embossed 11-centimetre-high cup was found in a prehistoric burial mound in a field in Kent by a member of the public using a metal detector.

Dating back to 1700-1500 B.C., the ceremonial vessel beaten from a single lump of gold is roughly the same age as the famous prehistoric stone circle at Stonehenge and is one of the oldest treasures ever discovered in Britain.

A similar treasure, the Rillaton cup, was found buried with a human skeleton in Cornwall 1837 and is now in the British Museum.


Black Blade: All that commotion over a barbarous relic. Hmmm�

http://www.mrci.com/qpnight.asp
Asian markets were mixed with very little movemnet in either direction. Oil is up 29 cents and threatening to rebound over $27.00/bbl. Gold has slipped into a coma. In the ME, Arafat now says he is willing to accept "Bush Peace Plan". Meanwhile fighting is still flaring up in Bethlehem while Israelis and Palestinian fighters demolish Christian shrine. Also, Lebanese have fired Katushka rockets into Israel.

- Black Blade

Just across the wire is a report that Iran has called for a month-long Oil Embargo against the west. Awaiting details.

- Black Blade

http://quote.bloomberg.com/fgcgi.cgi?ptitle=Top%20Financial%20News&s1=blk&tp=ad_topright_topfin&refer=topfin&T=markets_bfgcgi_content99.ht&s2=blk&bt=ad_position1_topfin∣dle=ad_frame2_topfin&s=APK11phQYU3VtaXRv

Tokyo, April 5 (Bloomberg) -- Sumitomo Mitsui Banking Corp. said it expects a full-year loss more than three times its earlier forecast because it wrote off more bad loans than previously planned.

Sumitomo Mitsui, the world's second-largest lender by assets, said its group loss probably totaled 480 billion yen ($3.63 billion) for the year ended March 31, larger than the 150 billion yen loss it forecast on Nov. 26.

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020404/ap_wo_en_ge/iran_jews_1
Snippit:

SHIRAZ, Iran - As members of Iran's tiny Jewish community celebrated the festival marking the biblical delivery of Jews from slavery, others longed for 10 people imprisoned on charges of spying for Israel.

Black Blade: As posted a couple of days earlier.

http://news.bbc.co.uk/hi/english/business/newsid_1912000/1912144.stmIMF 'to ignore' Argentina cash plea

The International Monetary Fund (IMF) is unlikely to release new funds to help Argentina's struggling economy, a report has said.
-----
IMF insiders said the fund's tough stance was backed by Horst Koehler and his new deputy, Anne Krueger.
-----
A formal announcement is not expected from the IMF until early May, after the political considerations of the board.

http://story.news.yahoo.com/news?tmpl=story&cid=573&ncid=757&e=4&u=/nm/20020404/od_nm/glass_dc_1

Snippit:

LONDON (Reuters) - Drink up that beer -- another will soon be whisked to the table thanks to a hi-tech pint glass that tells bar staff when it needs refilling.

Developed by a Japanese electronics company, the intelligent glass is fitted with a radio-frequency coil in its base and emits a signal to a receiver set in the table when it's empty, New Scientist magazine reported Thursday.

The iGlassware system works by coating each glass with a clear, conducting material, enabling it to measure exactly how much liquid has been sipped or guzzled. When empty, the glass sends an electronic cry for more beer from the table to waiters equipped with hand-held computers on frequencies similar to those used by mobile phones.


Black Blade: Oh Yeah!!! I'm making my Christmas list.

MOSCOW -(Dow Jones)- Iran 's supreme leader Ayatollah Ali Khamenei has called on Islamic oil-producing countries to suspend their exports to "pro-Israel" western states, the BBC reported on its Web site Friday.

"Arab governments can use oil as a weapon. They can cut off the flow of oil to all the countries which have good ties with Israel ," Khamenei said in a sermon during the Friday Prayers in Tehran .

Khamenei said that exports should be stopped "for a symbolic period of one month."...


Black Blade: If Iran cuts off oil it's certain that Iraq and possibly Libya will follow.

http://www.ny.frb.org/pihome/fedpoint/fed14.htmlSeems like you'd be looking for the dumbest guy in the room to offload to. Or maybe the most corrupt. Or both. My bet would be the ESF or some other government operation. But that's just a hunch since I really don't understand derivatives.

http://www.cnet.com/investor/news/newsitem/0-9900-1028-9628658-0.html?tag=ats
Snippit:

LONDON, April 5 (Reuters) - European gold struggled above $300 an ounce on Friday morning as a glimmer of hope emerged in the Middle East and profit-taking appeared to have run its course, traders said.

Gold dipped below $300 in late European business on Thursday and did so in U.S. and Asian trading, after U.S. President Bush eased market fears by calling for a halt to Israel's drive in the West Bank. But dealers said the $300 barrier looked like holding as speculative buyers move in at lower numbers.

"We now need something new to push the market higher. The Middle East has been factored in to a certain extent, although Bush helped smooth fears yesterday. There has been some good physical buying in Asia and in Europe this morning which has helped it above $300," one dealer said.


Black Blade: Maybe Gold has support at $300.00/oz. Buy the dips to $300.00?

http://www.globeandmail.com/servlet/GIS.Servlets.HTMLTemplate?tf=tgam/search/tgam/SearchFullStory.html&cf=tgam/search/tgam/SearchFullStory.cfg&configFileLoc=tgam/config&encoded_keywords=HEATHER+SCOFFIELD&option=☆t_row=2¤t_row=2☆t_row_offset1=#_rows=1&search_results_start=1
Nobel winner pushes single world currency By HEATHER SCOFFIELD Friday, April 5, 2002

Ottawa -- The world should move toward adopting a single currency system based on the U.S. dollar, Canadian Nobel Prize winner Robert Mundell said yesterday.

http://www.guardian.co.uk/enron/story/0,11337,679506,00.htmlInteresting article!

If the book center is as interesting as the web site commentary I can see why it has grown so tremendously. Thanks.

Arabian oil calling for an embargo to Western-Israel supporters and Nobel prize winner Mundell calling for a single currency system based on the US$ !
As if an euro simply didn't exist !
Since the situation in the ME has NO peacefull solution...the present embargo (selective oil offer) is a prelude somewhat closer to oil for euro. Prof. Mundell feeling the heat threathening the dollar survival as reserve currency on an oil standard.
Arabian oil doesn't want the US to solve the 50 year old problem and favors an Euroland approach, without military force but rather a well "oiled" currency (euro)/gold - concept as pressure on Western hostiles with incompatable ambitions. Germany acts against the French euroblock, because of its alliance with Russia (gas+oil).

Sorry, Pof. Mundell, but y're a bit late with your single dollar-derivative currency !

Thank you for your ideas, and humouring my supposed waste of time, they were different than my ideas and it is very nice to hear someone else's ideas. I guess for me the excitement of possibly being right is similar to a guessing contest, but for the most part I do believe each of us has an inclination, however few are willing to share.
I can tell that you are an individual of stamina, and that a little informative guessing isn't going to destroy your day by the possibility of being wrong.
It was merely an interpretation that I was seeking, and it was an interpretation you provided.
You made my day!

RobotGuy.

http://www.yiddishbookcenter.org/story.php?n=6My reaction was the same, and I forgot to mention it as you did. It is just such a clear example of intelligent people doing intelligent things in a situation of dire need, it deserves to be seen by anyone who appreciates such things.

I tried to visit while passing through the town but missed the closing time by an hour. I was permitted to stand in the central raised lobby and look out over the evidence of Hitler's final defeat. I find the idea of this place's existence thrilling, and I'm not even Jewish.

But I'm a guy who's still saddened by the loss of the Library at Alexandria 1600 years ago.

http://www.unesco.org/webworld/alexandria_new/index.html

I met some of the people with the tattooed numbers on their arms at times in my youth, and I'll never forget the wisdom they had to offer as Holocaust survivors. But their survival was personal and they mostly wanted to leave the past behind. It was left for their grandchildren to rediscover the culture they had left behind.

The fact is that Europe's Jewish culture was about to suffer a "second death", and Lansky and others prevented it. This is true heroism, in my book. (I don't know what other libraries, if any, were being preserved in Israel or elsewhere, but the sheer volume of Lansky's discoveries says that the "aftershock" of the Holocaust was still in effect.) As a life's work, this is something I could be proud of.

This should also be a lesson that if you feel drawn to do something you believe is right, but think conceptually you are not the "right person" (or don't have "standing", in the words of a certain Boston court), well, maybe you should go ahead and explore it just a little bit further...


"Number of distinct Jewish languages: 18
Age of Yiddish in years: 1,000
Approximate percentage of the world's Jews who, until 1939, spoke Yiddish as their first or only language: 75%
Number of Yiddish speakers in the world in 1939: 11,000,000
Percentage of all Yiddish speakers killed in the Holocaust: 50% ...
"Total number of Yiddish books that experts, meeting in 1980, estimated were still extant and recoverable in all of North America: 70,000
Total number of Yiddish books recovered by the National Yiddish Book Center in 1980 alone: 70,000
Yiddish books we've collected to date: 1.5 million ...
"Folios of mint-condition Yiddish and Hebrew sheet music we recovered from a garage in Boro Park, Brooklyn, in 1986: 85,000
Folios of mint-condition Yiddish and Hebrew sheet music we recovered from a warehouse beneath the Brooklyn Bridge in 1992: 75,000
"Significant Yiddish library collections that existed in all of North America when we opened our doors in 1980: 6
Major university and research libraries where we've established or strengthened Yiddish holdings today: 455 "

From New Australian article...Gerard Jackson sums it up in this qoute from his latest article in the New Austrailian.....

(Quote)

The more anyone is promoted by the media and the rest of the economic illiterati as an economic thinker the more likely it is that they are an economic illiterate peddling half-baked ideas guaranteed to impoverish people......unquote

How True!
GO GATA & "GO PHYSICAL"

:o)

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Read the full commentary and related information here. (access codes required)

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http://www.usagold.com/gold/coins/rationale.html

They make new BULLION every day.

They stopped making these BEAUTIES long ago.

A fixed supply has its advantages.

Call USAGOLD / Centennial to discuss the investment strategy that's right for you.

http://www.usagold.com/goldenchalkboard/gc_miner49er.htmlThanks again to Miner49er and to EVERYONE who provides their friends here with delving thoughts and discussion on gold, money and wealth.

R.

http://biz.yahoo.com/rf/020405/markets_precious_13.htmlSnippit:
"COMEX gold dipped back below $300 an ounce for the first time in nine days early Friday on dealer selling and liquidation of safe-haven positions booked during this week of violence in the Holy Land.

But the market quickly reclaimed the psychological support level, still nervous about one of bloodiest episodes in the Mideast in years while the head winds remained forceful in an overbought market, dealers said.

``The action has been a little spasmodic this morning,'' said Donald Tierney of Pell Brothers Futures. ``For the moment, with still enough uncertainties in view, it appears that the $300 level will hold.''

``The daily studies are still unwinding from overbought,'' wrote JP Morgan Chase analyst in a technical commentary Friday. ``However, looking at the bigger picture, we believe this is merely a correction within the underlying bull trend which is targeting a move to and through the $308.50 previous high.''

Funds have shown surprising fortitude with their holdings, and even stepped in to purchase more during a drop Thursday which held at $300, where their bids were reinforced by physical demand from hoarders from India and the Mideast.

Waverider: ? JP Morgan Chase analyst sees POG moving through $308.50? A Good Day to All!

http://biz.yahoo.com/rf/020405/markets_precious_13.htmlExcerpts:

NEW YORK, April 5 (Reuters) - COMEX gold dipped back below $300 an ounce for the first time in nine days early Friday on dealer selling and liquidation of safe-haven positions booked during this week of violence in the Holy Land.

But the market quickly reclaimed the psychological support level, still nervous about one of bloodiest episodes in the Mideast in years while the head winds remained forceful in an overbought market, dealers said.

``The daily studies are still unwinding from overbought,'' wrote JP Morgan Chase analyst in a technical commentary Friday. ``However, looking at the bigger picture, we believe this is merely a correction within the underlying bull trend which is targeting a move to and through the $308.50 previous high.''
----(click URL for full article)----

More and more, the mainstream media are shedding their former anti-gold dispositions. Those with an eye to the realities of the physical market know its price (derived spot plus premium) has the potential to explode higher with very little warning should it happen that more people pay heed to the world around them and simply seek modest diversification. Further, any serious investment interest in gold ownership would likely very quickly reveal alternative "paper gold" as nothing more than paper which requires confidence and counterparty performance. Can you see how such items could rise early but then fall off a cliff even as physical gold swept onward and upward with increased momentum?

See my post yesterday (#: 72722). The European Central Bank (among others) is marking gold assets to market value -- and not by accident or without much forethought for the world ahead. Place your order with Centennial today and get your delivery in the pipeline.

R.

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http://www.nationalpost.com/financialpost/story.html?f=/stories/20020405/549205.html
April 5, 2002
Nortel's debt turns to junk
Moody's downgrades credit rating three notches as major borrowing deadline looms
Mark Evans
Financial Post

Jim Young, Reuters
Nortel's credit rating remains two notches higher than that of ...

Nortel Networks Corp. had its credit rating downgraded to junk status yesterday by Moody's Investors Services Inc., amid concerns that the sharp downturn of the telecommunications equipment market will likely last longer and be much more painful than previously expected.

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

BTW The unemployment numbers from last week have been revised upward...now the rate is 5.7%

Are we having FUN yet?

Oh yeah...almost forgot...for the first time since the 1930's dividends have fallen for three consecutive years. But we aren't in a recession. Nope...NO RECESSION!

Can you spell...."Default"Excert from previous T Crier post....

---interest in gold ownership would likely very quickly reveal alternative "paper gold" as nothing more than paper which requires confidence and counterparty performance.


***Pretty hard to have a default on what you can see, hold and hide!......In the case of public owned and traded CO.'s
which have major paper shorts & Derivative trade losses on the books, well we all know who gets left holding the bag. Not to mention they may be liable for debts/losses.....
Insiders like Brian Mulrooney/Barrick, and others too numerous to mention, have already found the lifeboats.
.....YGM.

Well done! Your intuition was quite accurate! Gold closed today slightly under 300.

What did gold end at? Did we hold the front lines at
300? I see here there's a post saying gold closed just
under 300, but bloomberg is showing it closed at 301.10
dwn. 90 cents. Good if it did.. Truthcaster

Cash on the sidelines....IMO,,,if ME crisis continues next week we'll see renewed buying from the specs as I imagine there was alot of cash already sitting and more acummulated on the sidelines this week. That kind of money does not sit idle long and the only reasonable bet is PM's......World full of uncertainty out there and smart money follows old money......YGM

I was referring initially to my trusty .gif stolen from a popular gold web site, and it gave me 299.80, but after a quick glance at NYMEX, I saw another value of 301.10 for the most recent close. Now I really am not sure what it is sitting at.

RobotGuy (04/05/02; 12:44:04MT - usagold.com msg#: 72814)
Truthcaster - - - Ahh yes, the age old question, what price is it really?
==
You can choose any of the following --
http://quotes.ino.com/chart/?s=FOREX_XAUUSDO
From the USAGOLD page --
Which shows: Bid $300.00 Ask $300.50 Last $300.50
--
http://informer2.comdirect.de/de/detail/_pages/charts/main.html?sSymbol=GLD.FX1&sTimeframe=iD&useSettings=0&showSettings=&sid=&hiddenTimeFrame=&sOrdType=price&sScale=linear&sMarket=GLD.FX1&iType=1&sAv1=38&sAvfree1=&sAv2=200&sAv2free2=&sAv2count=1&iInd0=na&sBench1=na&sBenchcount=1&sBench2=&sBench2count=1&showBenchmarkSearch=&iInd1=na&iInd2=na&iIndcount=1&sSettings=na
===
WOWSERS--What a long link --- Perhaps because it is far far away in Germany ! <;-)
which shows: close at $300.10 and a graph !!!
----
OR
http://www.thebulliondesk.com/
and click on the Bullion -- Interactive Gold chart and see:
Bid $299.8 Ask $300.3 Last $299.8
===
OR
you could take a look at the often error ridden "K" chart !
NAW
--
Good luck
<;-)

http://www.morganstanley.com/GEFdata/digests/20020405-fri.html#anchor0
Plus a very interesting commentary on the US dollar going forward.Congratulations to MSDW for speaking the unspeakable on Wall St.; the possibility of free liquidity moving to gold,both as a safe haven and as a poltical weapon to effect change.

By Morgan Stanley's Stephen Roach, whom I've had the honor to meet together with Byron Wien years back.

Thanks Sector for putting it up. I find those two Analysts are still down to earth and just want to highlight the gist of the statement again:

*** "The longer the day of reckoning is put off," writes Morgan Stanley's Stephen Roach, "the more severe the impacts of the adjustment process are likely to be." Roach is referring to America's coming current-account adjustment..."hints" of which, he says, "are already in the air."

*** Foreign capital inflows into the U.S. have slowed considerably in 2002. "In January, portfolio inflows into dollar-denominated assets slowed to just $11.3 billion, a marked deceleration from average monthly flows $44 billion recorded in 2001."

*** What should we expect if the trend continues? "As I see it," says Roach, "two aspects of America's looming current-account adjustment should be especially important [to financial markets] - weaker GDP growth and a falling dollar...A correction is coming, and there's no dark secret as to what that means. It's just a matter of when the denial finally cracks."

... I guess, it was Doug Noland, who has foreseen that portfolio inflows have to reach about 2 Billion $'s a day, just to keep up the status quo. Well now we have only about
1/3 of a Billion reaching the US shores, in order to shore up deteriorating CA. While Japanese, Europeans and others are accelerating their departure, as funds are increasingly needed at home.

Looks like High Noon for the goons at the FED - while they already try to rescue their bullion banking bums, scum or scams?

Whom do they wan'na kid? Me, You? cb2

I got the liquor
but the Sheriff got it quicker ...

Similar thoughts across the big splash -
Regards - cb2

http://www.usagold.com/goldenchalkboard/gc_index.htmlFrom time to time I have brought forth an individual "Golden Chalkboard" page as warranted by events or discussion topics. Until now, there was no easy way for anyone to revisit these pages unless they bookmarked them, explored the forum archives, or found them with an internet search engine.

Here now for the first time I have thrown together an INDEX. Although for future reference you won't find this dainty little nothing of a thing on the homepage, (it's not worthy), you will find it on our site map. Has anyone discovered the whereabouts of that yet? I can be quite handy at times for site navigation.

As the weekend draws nigh, I'll be sure to raise a toast to the good health of the first person I see that manages to find and post the link to our sitemap.

R.

The sitemap, that is. For "I" am never handy.

(Although I rhyme)

Randy

http://www.usagold.com/sitemap.htmlThe CoinGuy

"May you live to be a thousand years, sir."

Randy

The symbolic and selective embargo-call, expressed by Iran
is a different beast than what happened in the 1970-ties (1974 ATH) ! With Nixon having closed the dollar/Gold-window, POO was revaluating the dollar-reserve-currency WITHOUT having the present euro-alternative. The dramatic surge in POO was indiscriminate and the whole globe suffered from this renewed price-setting. Today, a total economic sanction is NOT wanted ! It is not the dollar as such that is targeted but rather the government behind that dollar and more precisely its (gvnmt) ME policy. This new way of "selective" oil-threath must be the result of inclination versus the euro and TG's concept.

But Iran's statement is only a post factum explanation of what already had been done : POO from 16$ to the 22$-28$ price zone. And therefore to be interpreted as a warning for more of the same if nothing changes drastically on the Palestinian question. The attitude of Russian (private) oil is of course an unknown. But they go/follow where the profit is ! Ties between Russia and Iran are re-inforced.
Kuwait and Saudi Arabia play their double cross game and Iraq is probably winning time. Next week we have to decode a possible Blair briefing on his Texas visit.

The geo-political waves are a nice playing field for the speculators on oil/gold futures. Does Arafat AND Sharon want to lure US forces (instead of UN) into Israel ?
Israel can't face its economic reality without the permanent aid from the US. That's why peace will never happen in Israel (unfortunately). UK citizens start to question the closeness of UK politics (support) with the US ! The whole Israel problem is functioning as a polirazator between the pro and contra blocks. Oil-dollar-euro and therefore Gold are surfing these waves, again, with the euro as third party (newcomer).

The euro (concept) must be the only reason that the ME isn't attacking the dollar directly with the Gold weapon !
Gold Giants could induce dollar-hyperinflation instantly with the Gold canon. But then they are disturbing and jeopardizing the outside US dollar-reserves policies !
And this was not planned ! An organized, fast dollar crash would make it impossible to compensate dollar-reserve losses with Gold-reserves appreciation for the euro allies who are not yet ready. China exports wants to profit as long as possible from a stable (strong) dollar.

Nice weekend to all.

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=APK0QyBTcSmFwYW4n
Snippit:


Tokyo, April 5 (Bloomberg) -- The Japanese government's debt collecting agency has 20 officers trained in martial arts and small arms, a vital skill when much of the $33 billion it aims to recover was lent to yakuza gangsters. Japan's mafia isn't the only clique the Resolution and Collection Corp. is finding hard to crack.

The banks aren't disposing of their bad debts because to do so on a significant basis would bankrupt them, the RCC said. Banks ``don't want to realize losses because they will become insolvent,'' said Kurihara. ``There would have to be an injection of public money'' to keep lenders solvent.

And collection is getting more difficult.

``There are lots of mob loans,'' said Kurihara. ``The yakuza bought real estate. The mortgage is with the failed financial institution and we have bought the mortgage from them. The private sector doesn't want to collect the money.''

Debt Busters

That's where the debt squad comes in. The 20-person unit -- seconded from Japan's police force -- specializes in collecting loans from potentially violent customers.


Black Blade: So the bankers come to break your kneecaps. Hmmm�

As always, get outta debt, get Gold and Silver portfolio insurance, get enough cash on hand for expenses, and get a nonperishable food and basic goods storage program started.

Sample:
"The dramatic surge in POO was indiscriminate and the whole globe suffered from this renewed price-setting. Today, a total economic sanction is NOT wanted ! It is not the dollar as such that is targeted but rather the government behind that dollar and more precisely its (gvnmt) ME policy."
---
Nice work as always. You're aces in my book.

Randy

Thanks for your recent posts -- some interesting ideas.

How would you rank the reasons for the Welteke gold gaffes of late between. . . .

1. A desire to drive down the price of gold

2. Angling for a piece of the next Washington Agreement annual allotment

3. Bailing out one or more German banks

Or do you have list of your own?

Also, I wonder what this sort of thing does to the "fabric" of the EU and the ECB. After all, I do not believe the French would have ever believed that their primary partner would be a gold seller. Welteke's gold comments certainly took most of the gold world by surprise given German history and currency policy since WWII -- a departure to say the least from the old days of a solid D-mark with gold in the background to make it stick. Cobra Too mentioned to me in private conversation that the conservative party in Germany looks for very good for the upcoming election -- one wonders if this could become a campaign issue.

By the way, I invite comments, observations, etc from any and all on the Bundesbank/Welteke situation -- particularly our European posters.

Omitted as per the rules.......Interesting Stats tho!!Business


Dear Daily Reckoning Reader,

"The Arabs have a saying," John Myers tells me, "Trust in Allah,
but make sure you tie up your camel." In short, things aren't
what they seem. And right now -- you're not getting the whole
story behind one of this year's biggest headlines: the growing
conflict in the Middle East.



Every year for the past two decades the oil industry has pumped
more oil than it has discovered. Over the 1990s, that trend
accelerated. Oil companies drained more than 3 times what
they've even found. John's "little black book" contains a host
of these gems...

* Today's oil estimates don't take into account 2 billion
barrels of Kuwaiti oil burned by Iraq in 1991.

* Not one super-giant oil field has been discovered since
Prudhoe Bay. That was 33 years ago.

* Yet OPEC recently added 287 billion barrels to their official
reserve tallies in a single year -- without making a single new
oil discovery... that's more oil than we've ever discovered in
the United States -- plus 40% (what's going on there?!).

* Today a terrific oil field will yield 250,000 barrels per day.
The United States alone burns through that much oil in a little
under three hours!

Industry secrets like these make the developing Middle East
crisis all the more tense for everyone involved.

Fact is, despite being the lifeblood of the economy... the oil
"reserves" are anything but the stable supply you are led to
believe. Therein lies the secret. Insider knowledge like this is
how oil industry execs make a killing when a crisis develops.

If I were an Arab and my primary export(oil) provided my only source of income, I would be very concerned about accepting 27 paper dollars per barrel.

What would my kids and grandkids do for income when the oil is gone? It's not like they have many options. The Arabs sell oil. It's all they have. We have used a lot of it up and continue to do so at a much faster rate than most of the world.

How long will they continue to take only $27? How long will that paper last?

I think he's right YGM. Lot more to it than we hear.

I received this by e-mail and just throwing it out to the board. There are a few questions that come to mind after reading it, like who was the territory taken from to establish a Jewish Nation in 1312 BCE. Where did the non-Arab refugees that existed previous to any influx come from or how long have their ancestors been living in the territory. Anyway there are some interesting facts.
__________

Many free people who live in democratic countries, particularly Americans, are confused by what's happening between Israel and Yasser Arafat. This confusion is generally caused by a lack of historical understanding about this region. I hope you find the following useful in developing your own informed views of this difficult situation.

SO, HERE ARE THE BRIEF, INDISPUTABLE FACTS ON THE ISRAELI CONFLICT
TODAY...

Takes just 1.5 minutes to read! It makes sense and it's not slanted. Jew and non-Jew ... it doesn't matter. Please read.

1. Nationhood and Jerusalem - Israel became a nation in 1312 BCE, two thousand years before the rise of Islam.

2. Arab refugees in Israel began identifying themselves as part of a Palestinian people in 1967, two decades after the establishment of the modern State of Israel.

3. Since the Jewish conquest in 1272 BCE the Jews have had dominion over the land for one thousand years with a continuous presence in the land for the past 3,300 years.

4. The only Arab dominion since the conquest in 635 CE lasted no more than 22 years.

5. For over 3,300 years, Jerusalem has been the Jewish capital. Jerusalem has never been the capital of any Arab or Muslim entity. Even when the Jordanians occupied Jerusalem, they never sought to make it their capital, and Arab leaders did not come to visit.

6. Jerusalem is mentioned over 700 times in the Tanach, the Jewish Holy Scriptures. Jerusalem is not mentioned once in the Koran.

7. King David founded the city of Jerusalem. Mohammed never came to Jerusalem.

8. Jews pray facing Jerusalem. Muslims pray with their backs toward Jerusalem.

9. Arab and Jewish Refugees - In 1948 the Arab refugees were encouraged to leave Israel by Arab leaders promising to purge the land of Jews. Sixty-eight percent left without ever seeing an Israeli soldier.

10. The Jewish refugees were forced to flee from Arab lands due to Arab brutality, persecution and pogroms.

11. The number of Arab refugees who left Israel in 1948 is estimated to be around 630,000. The number of Jewish refugees from Arab lands is estimated to be the same.

12. Arab refugees were INTENTIONALLY not absorbed or integrated into the Arab lands to which they fled, despite the vast Arab territory. Out of the 100,000,000 refugees since World War II, theirs is the only refugee group in the world that has never been absorbed or integrated into their
own peoples' lands. Jewish refugees were completely absorbed into Israel, a country no larger than the state of New Jersey.

13. The Arab - Israeli Conflict - The Arabs are represented by eight separate nations, not including the Palestinians. There is only one Jewish nation. The Arab nations initiated all five wars and lost. Israel defended itself each time and won.

14. The PLO's Charter still calls for the destruction of the state of Israel. Israel has given the Palestinians most of the West Bank land, autonomy under the Palestinian Authority, and has supplied them with weapons.

15. Under Jordanian rule, Jewish holy sites were desecrated and the Jews were denied access to places of worship. Under Israeli rule, all Muslim and Christian sites have been preserved and made accessible to people of all faiths.

16. The UN Record on Israel and the Arabs - Of the 175 Security Council resolutions passed before 1990, 97 were directed against Israel.

17. Of the 690 General Assembly resolutions voted on before 1990, 429 were directed against Israel.

18. The U.N was silent while 58 Jerusalem Synagogues were destroyed by the Jordanians.

19. The U.N. was silent while the Jordanians systematically desecrated the ancient Jewish cemetery on the Mount of Olives.

20. The U.N. was silent while the Jordanians enforced an Apartheid-like policy of preventing Jews from visiting the Temple Mount and the Western Wall.

These are incredible times. We have to ask what our role should be. What will we tell our grandchildren we did when there was a turning point in Jewish destiny, an opportunity to make a difference?

http://www.forbes.com/work/managementtrends/newswire/2002/04/05/rtr561128.htmlHEADLINE: Crumpled bills lead Ecuador to offer "gold" US coin

QUITO, Ecuador (Reuters) - The U.S. dollar may be one of the world's strongest currencies, but the greenback has lost a battle in Ecuador to the newer gold dollar coin due to locals' habit of crumpling paper bills.

The Andean nation adopted the U.S. dollar as its official currency in 2000 to halt spiraling inflation and the devaluation of its local sucre currency amid the worst economic crisis in decades.

...The Central Bank, tired of having to ship tattered bills north to exchange them for fresh dollars, plans to put 5 million of the U.S. gold dollar coins into circulation starting April 15.
------(click URL for full article)--------

You know how the banking system works. Whenever the people, government, and corporations in this inflation-prone country seek to borrow money from their network of banks, they will effectively be creating U.S. dollars.

Gold for savings. Need I say more?

R.

http://www.gulfnews.com/Articles/news.asp?ArticleID=46653HEADLINE: Middle East crisis sets off rush into gold market

London (Reuters) 06-04-2002: The Middle East's plunge into turmoil has driven gold prices towards their highest for more than two years as investors scramble for a safe home for their money, analysts said on Friday.

...Bullish gold fundamentals, including falling supplies from mines worldwide and a reluctance by producers to sell unmined nuggets in forward markets, has also underpinned the rally.

Analysts now wonder if the precious metal is about to enjoy the investor limelight after years of taking a backseat when stock markets boomed, the dollar was mighty and gold appeared to be an investment tool from a distant age.

"There's more interest being seen in gold now than in the last 15 years. There's been a mind-set change," said Peter Hillyard, senior manager at ANZ Investment Bank.

..."Gold is absolutely flying...physical buying is extremely good. The Middle East has unsettled people's thoughts of a stable political and economic environment," said Ross Norman, analyst at TheBullionDesk.
------

Unlike the popping of a speculative investment bubble in which prices fall when confidence is lost, what we shall likely see is a reverse -- the popping of the bullion banking illusion that there is adequate physical gold to satisfy all claims against it. Prices will soar for metal in hand. Believe it.

R.

The Importance of MS's Roach and his coming currency "Adjustment"Morgan dropped their gold derivatives by $19 Billion to $7 Billion, CitiBank followed by halving theirs to $7 Billion and we wait on Chase's future actions[Although JPM has conjoined their OCC reporting of late].

These gold shorters have reduced their positions in a big way. To whom they have shifted their risk is an important unanswered question. The logical recipient is the Fed. Thus, they "Borrowed" gold and sold it to amass their $60 Billion aggregate position [At its peak] and now somehow have "returned" the gold to "Cancel" their short derivatives. It seems reasonable that the Fed will "Cancel" any physical obligations they may have in the future since they can't possible cover all their gold banking and "loaning" activity with physical metal.

Is this the only problem the Fed has? Well, there is the currency destabilizating current account deficit Then there is JPMs interest rate derivative mountain [Firmly inked to the price of gold]. JPM has dropped their IRDs by $4 Trillion in the latest OCC report. So we can guess that there is a coordinated [If not crash] effort under way to reduce gold-related risk at the largest Fed banks.

The risk to the Fed's banks is the likelihood of a gold price rise.

That event happens in only two ways (1)the Treasury decides [At some random moment] to cease selling gold [A "devaluation" ostensibly to assist US manufacturers in becoming more competitive] and (2) the Treasury is overwhelmed by spiking gold demand which precipitously drains its remaining gold stocks.

The deval is estimate at 19% from Fed reports of past deval events. But that is too weak. Too weak because Mr. Greenspan hasn't told the governors about everything and thus at the eleventh hour the 19% will become 30% to cover the skeletons he has hidden.

Gold will overnight be trading 19% [30% If I'm right] higher. POG =$360 to $420.

That a deval must happen is virtually certain.

The essential question is will gold get away from the Fed once the move is made? After all, there is no shortage of danger in the world.

test

http://www.fms.treas.gov/dts/02040400.txtAs of April 4, the Treasury has hit its debt limit

Limit: $US 5,950,000,000,000
Debt Subject To Limit: $US 5,949,975,000,000

Note that the level is now $25,000,000 short of the limit. Back in 1996, Mr Rubin stopped Treasury debt growth precisely $US 25,000,000 short of the then debt limit and kept it there for weeks. Mr O'Neill is certainly following Mr Rubin's recipe to the letter.

Paper for Oil or Gold for Oil?I think if you read in depth the posts of Another and FOA which are here linked at USA Gold (I'm in a hurry w/ this note BTW) you will find clues as to which they recieve more of. Many of the more conversant posters here could give you a much better sense of that than I. However I believe some Arab Nations have refused the US $$ in payment...Hope this helps....Back tommorrow....YGM.

I think you've nailed it once more. I don't understand the supposed derivatives drop, except as part of the context for an overnight POG shift that attempts to balance the Fed's position in fiat/gold at a level it estimates (via minmax gaming outcome calcs plugged into its econometric models) as defensible for at least a usable interval going forward.

Overnight, indeed, is the corresponding discontinuous move to the low-volatility "stability" we have experienced these past frustrating/patient years. And the defenestrating of the chart-followers who wait for a "confirmation" of the bull market. The physical "fools" will smile their private smiles and the rest will compose their rationalizations. In this case "better a year too early than a day too late" will prove the perfect maxim.

We'll have years and years following to poke and examine and explain the new economic landscape (hey -- most of us didn't know that things changed in 1971, did we? -- and how many years afterward has it taken for 1971 to become a known point in our econ history?) that others will still be floundering to adjust themselves to.

"Day after day, alone on a hill
The man with the foolish grin is keeping perfectly still.
And nobody wants to hear him,
they can tell what he wants to do.
And he never shows his feelings,
but the Fool on the Hill sees the sun going down
And the eyes in his head see the world spinning 'round."

(I think this might have been one of FOA's selections for us, if he had been of the "Beatles generation".)

"Like a thief in the night..."

1. Bush Sr. was a great hero of the war against Iraq, and thought it was he who pulled together a great alliance against the "New Hitler" Saddam - whom he never deigned to mention by his full name and title.

During that war, he steadily refused any "linkage" of the issue of Saddam Hussein's invasion of Kuwait, with the observance of Resolution 142 of the UN, calling for Israeli withdrawal from the occupied territories. "First, we deal with Saddam. When that is over, we'll talk about Israel and the Palestinians."

The war ended and Bush Sr. had a terrific popularity rating.

Then, he declared that a U.S. guarantee covering $10 billion in borrowings by Israel, would not be forthcoming.

James Baker III, Sec. of State, received an insulting treatment on his visit to Israel.

Things began to fall apart. The election was coming, and Bush Sr.'s popularity began to plunge. The media were all over him for "It's the Economy, Stupid!".

Bush Sr., having saved Israel from the Iraqi threat, thought he could now strongly influence Israel and settle the problem of the occupied territories. Talks in Madrid.

How wrong he was! Everything was coming up roses for Bush Sr., until he made the big mistake of thinking it was he who put together the great Western Alliance against Iraq, and that he could call the shots for Israel.

At the height of his popularity, I saw what he was doing and said to all who would listen: "George Bush Sr. will NOT be re-elected." No one believed me. They believed the polls.

Well, you know what happened.

2. Is the same story to be repeated in the case of Bush, Jr.? Looks like it to me.

There are just too many sympathizers of Israel in positions of great influence in the U.S., for Bush to adopt a policy contrary to Israeli objectives. That there might be a purge of these people from those positions, in totally unthinkable.

Bush Jr.'s popularity rating is today up in the high 80's. Watch for that rating to fall like a rock in the coming days.

I do not think Bush Jr. will be re-elected.

3. There will be a period of calm and hope in the next couple of weeks. But it will be based on false bases. Nothing is going to change in the Israeli-Palestinian problem. Look for a possible "terrorist attack" on U.S. soil, to allow the Israelis to move again.

Gold and oil will fall in value during this period. An opportunity to buy gold cheaply.

4. There will be no "one-month selective embargo of oil shipments to pro-Israeli countries". Iran and Iraq may attempt this, but nothing will come of it but losses of dollars for those countries. They will cave. There will be no war by a union of Moslem countries against Israel.

5. Things will get worse for the Palestinians. Much worse. The world, the UN, Europe, will groan about it, but nothing will be done. Israel will probably, in my opinion, carry out a massive "ethnic cleansing". It has been done before. The Turks drove out - how many hundreds of thousands? - of Greeks from eastern Turkey back in the 20's. Massive death toll. Nobody stopped them.

6. Oil flows will continue. In 3/5 years, the Palestinians will be forgotten. Israel will have triumphed.

7. The financial problems of the U.S. are not going to go away, nor can they be solved. The U.S. is in the process of destroying itself, or at least, it is its own worst enemy. Gold will reassert itself, as we all expect it to, because it is not a military problem, it is a financial reality that cannot be dissipated. Roach of Morgan Stanley has spoken truthfully.

8. When countries sink, if the sinking is gradual no one notices it much and few have the clarity of vision necessary to understand the underlying causes. So people become impoverished slowly, and their memories being short, they cannot really compare their previous well-being with present conditions. So they just go along, as best they can.
This is going to happen to the Japanese. Very, very few will buy gold. Of course, those very few may be sufficient to cause a permanent important rise in the price of gold.

And the same will happen to Joe Six Pack. All men are not created equal, some are smarter than others. The political result of '29 and the 30's for the U.S., was an opportunity for an FDR to carry out a revolution. No such opportunity, from the Left or from the Right, will be available in these times. Depression will come, but it will be denied by the Media. So, Joe Six Pack will just think it's his own bad luck. No political cohesion will be possible, among those down and out. Diverse groups may raise a ruckus, but they will be thrown a sop, and quiet down.

Pornography, drugs and hard rock will dull the minds of the young and strong. They will accept everything.

9. And so, let us watch the unfolding drama of our times, and take what precautions we may, by holding as much physical as we can. Never doubt for one instant, the wisdom of that approach. For we really KNOW only ONE THING: paper always has, and always will go to zero value eventually. We must act on that ONE THING THAT WE KNOW.

Have a happy weekend, all! We have a duty to be happy:

"Si fractus inlabatur orbis
Impavidum ferien ruinae" Horace 15 B.C.

"If the Universe should collapse upon us,
Unshaken we shall withstand its blows."

Sierra

I think that the best way to describe that quandary is through an Arab saying about Arab reliance on this depleting asset. "My grandfather rode a camel, my father drove a car, I fly a jet, and my son will ride a camel".

Years ago before FDR confiscate US Gold, the Saudi region oil producers required payment in Gold to Aramco for oil concessions. However, this means of payment was suddenly in peril after the FDR confiscation. US oil companies got around this for a while by using Gold from other sources (such as British Gold Sovereigns). I used to have a link to this history but have lost it some time ago when I wiped my hard drive clean. Maybe some one here on this forum has a link to this Gold for Oil history. Cheers!

- Black Blade

Personally I found this message to be completely provocative and I wonder why you would post if it was not to put a one sided view over that you agreed with. To say you just received it by E/mail & just throwing it out on the board is a bit disingenuous --- especially when you finish by saying --"anyway there are some interesting FACTS."

For most of my 50 + years I have admired & supported Israel & always thought of them as a brave & resourceful people. However over recent years my views have changed to the point now where I view Israel as the real enemy of peace in the Middle East. People all over the world have seen how Israel has been treating the Palestinians. The Israeli Government has been taking their land, bulldozing their houses & allowing the most rabid extremist Jews to continue with the spreading out off their settlements.

This is not a good look & while it is not all one sided the Israelis are being seen as the aggressors. The Palestinians mainly have stones to fight with against tanks, bulldozers & well-armed & trained soldiers. One can't help thinking that if the state of Israel was really wanting a lasting peace then it should start by pulling out of the extremist settlements & giving the land back to whom it belongs. Currently Israel is systematically smashing the Palestinian infrastructure needed to sustain even basic living standards. This is exactly what the bastard Indonesian jungle bunny soldiers did when they trashed Dili -- the capital of East Timor. Is no wonder that Palestinians resort to suicide bombings.

The following quote is from a post earlier this week - can't recall who said it but I concur :
"Israel is a nation born out of terrorism. After all, even Ariel Sharon was a member of the Irgun, a terrorist organization that murdered British citizens among others. He also gave orders for the attack on the USS Liberty where helpless unarmed US sailors were machine-gunned down in lifeboats (I thought that was rather cold-blooded myself). He also gave the order to slaughter men, women, and children in UN refugee camps in Southern Lebanon."

The US Government has not had the courage to tell Israel the truth. Israel should not be supported UNTIL it seeks a genuine and long-lasting peace with the Palestinians. Other US foreign policy is also suspect -they have many enemies. The American people are rightly patriotic --you have to stand by your country. However there is every reason why educated Americans should be yelling out about the way you are being used & abused by a rotten administration. They are TRAITORS indeed to have left the gaps they did in your Airport security allowing Sept 11 to happen. What a$$holes.

Just to bring it into focus on a real life level,
Every child born in this country is starting off with a debt of over $20,000.
That's right.
Every one of us owes more than $20,000 on top of any personal debt we have run up.
If the government balances the budget from here on in, we will all have to pay $133 per month for the next 30 years to pay off what has already been spent. (at 7% interest).
Yes that's right.
For a family of four that's $532 a month.

Guess again. Israel is a nation born out of slavery. Delivered by God out of Egyptian slavery into their promised land. Read the record in scripture.

Everybody has an opinion, and understandably quite a few of them have surfaced the past few days re: Israel and the Palestinians. I really don't believe too many people here (or ANYwhere in the general population) have enough personal experience to say who's the good guys and who's the bad guys. From what I've seen the past few weeks, and learned over my 40+ years, neither side has done anything that could objectively be taken as true strides toward a peaceful settlement. Oil or no oil, this conflict will go on. As someone pointed out the other day, these people have been at each other for centuries...to think that any modern day peace proposal will end everything is nothing more than naive arrogance (IMHO)! Leaders from both sides won a Nobel Peace prize a few years back...but to paraphrase Miss Jackson "What have you done for your people lately?" Both sides have committed unthinkable atrocities (unthinkable except to those that have been taught nothing but hate/self-preservation) upon the other. I don't believe anyone (person, group, nation...whatever) has the right to set out to destroy anyone else, but both sides have committed themselves to just that! Neither side will be happy until the other is gone...period! This latest session may very well get totally out of control despite the best efforts of those trying to end it. The fallout (hopefully no pun) if it does go from bad to worse could be very bad for more than just the US. Hope and pray for the best, but be responsible enough to do as much as you can to prepare for the worst.

http://www.zealllc.com/2002/goldoil2.htmSnippit:
"In what seems like a century ago in terms of all the incredible financial market and geopolitical developments of recent years, I penned an essay on gold and oil way back in June 2000.

In my earlier essay, titled "Gold Boiling in Oil", we took a look at gold and oil in their historical price context and examined their very strong relationship over time. I arrived at the conclusion that the relatively high oil prices at the time were exerting substantial upward pressure on gold prices, that ice-cold gold was heating up as it was trapped in the bottom of a great cauldron of boiling oil.

So, during this seemingly fitting time after a geopolitically-breathtaking couple of weeks, we decided to update our key gold and oil comparison graphs to see if the intricate dance between the gold and oil markets is ready to yield any more secrets now than it was way back in June 2000."

Waverider: Another excellent and timely read from Adam Hamilton - enjoy!

I have addressed this issue over the years and here over the last couple of years or so. But your post from the "Daily Reckoning" is essentially correct. Each new Giant (reserves of 1 billion bbl/day not "Super Giant" of 5 to 10 billion bbl/day) oil field found over the last 50 years has been progressively smaller. Roughly 120 of the largest oil fields produce about half of the worlds oil. The average age of the largest (Super Giants) is 43.5 years (Matthew Simmons, 2002).

Consider that there have been no new oil fields that produce more than 250,000 bbl/day (most of those are deep and ultra-deep water), yet the world's largest 19 Super Giants produce more than 500,00 bbl/day though they have an average age of about 70 years. And most of these fields are in various stages of decline � in other words they have already reached their "Hubbert Peak" (named after M. King Hubbert). The last two Super Giants with production over 1 million bbl/day that were discovered were Alaska's Prudhoe Bay in 1968 and Mexico's Cantarell Field in 1976. That's it! Since the 1970's all the new discoveries supply only a miniscule 13% of the world's daily production and new discoveries have been declining since the 1960's.

Of course this discussion does not consider recoverable oil or "Cheap Oil" which is necessary for fueling a robust economy. If the concept of "Cheap Oil" is ignored then we could conclude that there is enough oil for many decades. This is especially true is we consider the combination of Tar Sands, Heavy Crude Sludge, Oil Shale, Biofuels, natural gas liquids (NGL), etc.).

The point is that all the "Super Giants" and possibly "Giants" have been discovered. That is because they are obviously the easiest to find. Each successive discovery has been smaller than the previous discovery. All US Super Giant oil fields are in decline (including Alaska's Prudhoe Bay). Recently the North Sea Oil Field has been projected to have reached it's Hubbert Peak production and is now in decline. It is suspected that the Saudi Ghawar Field is close to reaching its Hubbert Peak projection (production data is a closely held secret). Interesting is that once a field reaches its Hubbert peak it then production declines rapidly. Of course with declining drilling activity and without a drilling boom in the works, it is very unlikely that we will have enough smaller fields to replace declining supply from Giant and Super Giant oilfields in future years. Immediate and long term prospects for "Cheap Energy" look rather grim.

- Black Blade

Resource:

Simmons, M. R., The World's Giant Oilfields, Hubbert Center Newsletter #2002/1. January 2002

Wow! As usual, Sierra has gotten some great points in, and gotten me going again. I was gonna take the night off...oh well.

From the lay, non-Jewish American's point of view, Israel was born out of the photographs of the death camp survivors, and the heaps of bones, ashes, and remnants of the dead. It has taken us decades to integrate the shock of this history into our lives in this world. But it did not take us long to conclude that this people's survivors deserved a home as safe as any of us had at present.

Israel's military was born out of the memory of the helpless ghetto inhabitants quarantined, then rounded up with no weapons, no defenders to stop the Gestapo's goon squads, and sent to die. "This will never happen again." was a response we could all identify with. Young Jews who acted out that response seemed heroic. Any of us would hope to have done the same. (The cause they were then enlisted in might be more questionable, but perhaps inevitable.)

Israel's politics was born out of a staunch resolve never to trust the world's nations again, even the above-stated sympathies to never let Jews be in peril again. Israel will imprison Vanunu, who reveals its nuclear arsenal. Israel will influence US politics and elections, spy on US policymaking, attack the USS Liberty -- in a fanatic devotion to its own survival. Understandable in its ruthlessness -- but therefore tolerable?

Meanwhile, politicians arise, as in any society. "I can advance myself by seizing upon these issues, these fears, these sympathies." Chameleonlike, will adapt to whatever history has propelled them into nationhood. Ideals aside, it is power that rules them. The evidence is in their deeds.

Getting Israel to act in its own long-term best interests -- this is the observer's dilemma. Calculations are made from different platforms; mine is not theirs. I can see theirs; but I must still speak from mine.

The Palestinians were not the evil enemy that threatened Israel's survival, certainly not since 1967. But Israel -- understandably -- came into existence PRIMED for such a second enemy. Palestinians had been the most likely COOPERATING neighbor for Israel among Arabs, most likely to help economic development, AND acceptance into the Arab neighborhood, after the initial war faded away.

Not an enemy, but they were a "competitor" for the same lands. Which some saw as lands for the taking. And what example did Israel have before them. "Where are the Jews of Europe now?" Germany is largely "Judenfrei", only 45,000 left out of millions gone, 50 years later. Never to come back. They see that people CAN be cleared out of spaces, and time will pass. And grass will grow over the graves. (Having been done to them, some may even think the world "owes them one.") That can set a policy course, unable to be spoken, but just as determined upon.

That is what we are seeing today.

Jews have taught the world more about Conscience, perhaps, than any other people, paying the highest price as its teachers. Conscience may seem like a weak second to tanks and bomber squadrons. But if we all speak -- and they act -- from what we have learned, perhaps we can help this resolve, as other "eternal" conflicts have recently resolved, in some way other than a Final Solution, that will tarnish the name "Israel" with a sadness that will be centuries in the dispelling.

Wim Duisenberg - ECB Press Conference :

He (WD) iterated the "very sensible matter" in wich CBs sell(sell=?) Gold under the CB Gold Agreemenet (WA) and commented that any future sales (leasings-reschuffles) by current (! more/less later)signatories would certainly not (NOT) be until the expiry of the current Agreement in 2004 !!!! (WGC)

A German faction is in support of the US$ for God knows what reason. Balkan / Russia common agenda (military) ? German dollar-investments in US � la Daimler Chrysler and impact on Deutsche Bank ? Disagreement with the Euroland euro/gold/oil concept (Russian oil/gas) ? Still on the look out for clues indicating the direction to look for.

1/ A desire to drive down (consolidate) the POG is a pro US$ stance and not a Goldsale pro !
2/ Next WA allotment (2004) is too late for relief to the present problems of unemployment (Elections-sept.'02).
3/ Bailing out (support) Deutsche Bank ? Possible, but impossible to know ! cfr. Nobody (except few insiders) knew about the Holzmann debacle for years !!! Any kind of suspicion is perfectly camouflaged and covered (see Enron-new culture of selfdelusion).

That there is a German Gold-Problem is clear ! Duisenberg W.
called for : Order ! Reassuring !?
Not ALL Eurolanders are Gold minded and desire to use the ancient Gold reserves for immediate relief and political support rather than backing the euro/gold-concept. Remember the discussion on 15% or 30% Gold-reserves. Gold's immense power is anti-social ! And talking about Gold in Euroland, automatically splits the pro and contra's in two camps.
Plunderers for immediate profit and Savers Long Term Stability. And it is exactly this same diversion that pops up each time the Gold word (reserves) is mentioned. Ahhghh Democraty...(Swiss referendum)!?

If next ECB presidency can't be given to the French Gold-Lovers (German opposition), the lilliputan Belgian alternative (compromis) presidency is also a quasi guarantee for (liberal) Gold sympathy !?

Sorry for not being able to offer more facts (certainties) on the matter.

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=140386

Snippit:

HOUSTON, Apr. 5 -- US drilling activity declined this week, wiping out last week's gain that was the first after 9 weeks of straight losses, officials of Baker Hughes Inc., Houston, reported Friday. There were 738 rotary rigs drilling in the US and its waters this week, 23 fewer than last week when there was a gain of 11 units. A year ago at this time, the US rig count was at 1,200 and still climbing.

This week's losses were in the usual areas�land and natural gas drilling. There were 613 land rigs working in the US this week, 21 less than last week. The number of units drilling inland waters was up 2 to 15. But the number of rigs drilling in the US offshore sector was down 4 to 110. That included 107 working rigs in the Gulf of Mexico, down 2 from last week. The total number of US rotary rigs drilling for natural gas was down by 18 to 591 this week. There were 145 rigs drilling for oil, a decrease of 5. Another 2 active rigs were unclassified.


Black Blade: Without replenishing reserves the domestic market is in peril and energy independence in extremely unlikely. The US is likely to be held hostage to Middle east oil from here on out. It is "Cheap Energy" that fuels the economy. It won't take much if one major ME oil producer decides to "punish" the western economies.

http://ogj.pennnet.com/articles/web_article_display.cfm?ARTICLE_CATEGORY=TOPST&ARTICLE_ID=140328Market watch: Bush's push for Middle East peace dampens energy prices

Snippit:

HOUSTON, Apr. 5 -- Energy futures prices fell sharply Thursday as strong talk from President George W. Bush fanned hopes of at least a ceasefire in the Middle East. Traders were encouraged by Bush's demand that Israel withdraw its forces from Palestinian territories and by his decision to send US Sec. of State Colin Powell to the region.

The first bearish reports of US petroleum inventories from both the American Petroleum Institute and the US Department of Energy in several weeks also accelerated downward momentum from Wednesday's trading session, analysts said. Price declines during the 2 days wiped out most of the increases earlier this week, bringing energy futures back near their pre-Easter levels.


Black Blade: This is a temporary measure as inventories have been in a general downward trend, even with Russian quota cheating. We now enter into the so-called "driving season" when traditionally gasoline use begins to rise and fuel prices start to rise. "Thankfully" this is not inflationary as it is not calculated in the "core rate" (dripping sarcasm). .

http://www.pimco.com/bonds_commentary_fedfocus_recent_index.htmDon't miss this great Pimco read on the Fed's operating system overall, including the Continental bank run.

I wonder how many Americans think Franklin ($100) was a President?

The following is a repost that I put forth on this forum quite some time ago. In light of recent events I repost it here. There have been some changes in Oil and Gold prices, however, the premise remains the same.

The Rise and Fall of "Hydro-Carbon Man" (Reprise)

HYDRO-CARBON MAN:

The modern industrial economy is dependent on cheap oil. Cheap oil has fueled the industrial age and has advanced modern man to what can best be described as the age of "Hydro-Carbon Man." Yes, there is evolution, as man evolved from the hunter-gather and agrarian society to the heavy industry of modern society. It was crude oil that gave rise to heavy industry, efficient mechanized transportation, increased out-put of goods and services, and has become vital for modern agriculture. But how long can Hydro-Carbon Man continue without cheap oil?

The question is not whether, but rather when cheap world crude oil productivity will begin to decline bringing about the long awaited "permanent oil shock." Demand for cheap oil continues to increase, all the while, the world's population continues to grow. The real problem of course, is when the production of oil peaks while demand continues to increase and the world's population continues to grow unabated. Emerging economies that are entering into the industrial age will also demand their share of oil. Oil was the principal fuel powering the "Asian Tigers" economic growth. A booming US economy continues to consume ever-increasing amounts of oil.

It was the abundance of cheap oil gave rise to "Hydro-Carbon Man ". Oil and its refined products allowed "Hydro-Carbon Man" to expand his productivity several fold. Now Hydro-Carbon Man's existence is threatened by the limitations of "cheap oil". Like a drug addict who suddenly has to face a very high price for his fix, Hydro-Carbon Man is about to learn the realities of life without an abundance of "cheap oil". Oil is the primary energy source for the world's economies and now we are faced with the limited ability to increase production of "cheap oil" and continue fueling future economic growth.

When the price of petroleum rose in the past it has had profound effects on the economy. Since oil is a vital commodity for everything from energy, to petrochemicals, to plastics, and to agriculture, it is perfectly understandable that high oil prices have resulted in economic recession. Gold and Silver prices generally increased in dollar terms as the effects of higher petroleum prices filter through the economy. Every postwar economic recession has been preceded by sudden oil price increases. In 1973 prices tripled in response to an Arab oil embargo as punishment for the western nations support of Israel during the 1973 Arab-Israeli conflict. In 1979, prices nearly doubled when the Shah was dethroned in Iran and the Soviets invaded Afghanistan. Oil prices rocketed to over $40.00/bbl during the 1990 Gulf War. The major economies went into a tail-spin and suffered through major recessions. These were only temporary disruptions to the economy. The coming oil crunch is not going to be so temporary. Gold and silver prices increased in the past as recession and inflation (stagflation) followed those oil shocks. Precious metals will rise in value in the coming oil shock as well. If we learn anything from our past, it should be that history does repeat time and again (my apologies to philosopher George Santayana).

WORLD OIL SUPPLY:

The first thing that one must remember is that the problem is not how much oil is left, but rather how much oil is recoverable, and more importantly, how much is economically recoverable. Secondly, what is perhaps more important is what happens when production no longer increases or worse, tapers off, while demand increases. Thirdly, the question arises whether or not non-conventional oil, alternative energy sources, new technology, and energy conservation measures can make up for the dwindling conventional oil reserves.

How did we get to the point where we risk not being able to produce sufficient oil? The member nations of OPEC have attempted to act in concert to manipulate oil prices by setting production quotas that often resulted in both cheating by various members. Many countries and companies have grossly exaggerated the estimates of their petroleum reserves in order to get increased OPEC production quotas, to increase their stock prices, or to obtain more collateral for their loans. Another problem lies in the definition of "reserves." Reserves are generally referred to as proven oil reserves that can be economically recovered using existing technology. However, many countries have played "fast and loose" with this definition. True that much of that oil does exist, but whether it is economically recoverable is debatable. Many simply do not understand the difference between "resources" (petroleum known to exist) and "reserves" (economically recoverable petroleum). They are unaware of the limitations of cheaply produced petroleum and point to the vast deposits of "non-conventional" petroleum sources such as tar sands and oil shales without awareness that these are "resources" and not "reserves." Without new improved technology or willingness to pay perhaps $60.00 or more per barrel of crude oil, these deposits are not likely to be extensively exploited.

Most of the world's oil has been found. The so-called "Super Giants" (extremely large oil fields) have been found prior to 1973. None have been found since, and this includes the time period encompassing the early 1980's when crude hit all-time highs and new technology was developed. In fact, the discovery rate for "Large Fields" has declined. Perhaps as much as 90% of the world's crude oil has been found. The amount of new discoveries in the world has dropped from a peak of 41 billion barrels in 1962 to an annual rate of 5 billion to 6 billion barrels a year now.

Predicting when oil production increases will peak and when the inevitable decline begins can be fairly accurately calculated. This mathematical model was first published in 1956 by M. King Hubbert, a Shell Oil geologist. He realized early on that the unrestricted extraction of oil from a region eventually reaches a maximum production level. He fitted a bell curve to production statistics and projected the point when production peaks would occur. He did this for US oil production in the lower 48 states and concluded that oil production would peak in 1969, give or take a year. US production actually peaked in 1970. Oil productions from other regions around the world have successfully followed the Hubbert Curve model. The analysis reveals that Norway and the U.K. have likely reached their production peaks. Mexico's largest oil field, offshore Cantarell, has a $10 billion nitrogen injection project about to be commissioned to re-pressurize the field to offset declining production. Venezuela is facing a similar situation as Mexico. The Persian Gulf states are expected to reach peak production between 2006 and 2009. Global peak production could be reached as early as 2002, then decline over the next 70 years. As oil stocks peak and eventually decline, prices will rise steeply. Provided that there isn't a global recession (a more likely probability), then worldwide oil production should peak during the first decade of the 21st century.

What about undiscovered oil fields? There are very few geologically probable places that have not been actively explored. This includes extremely deep water and the polar regions. Since these areas are in remote and generally inaccessible regions, the costs alone would make any such oil fields uneconomic, if in fact they did exist. The problem is not so much that there is a shortage of reserves, but rather a shortage of production. For years energy companies have not invested in increasing their oil production capacity and refining capacity. In fact, in the US, no new refineries have been built since the 1970's due to EPA regulations and perceived liabilities.

WORLD DEMAND:

World demand for cheap oil is growing exponentially due to population and economic growth. The emerging economies of China, India, Southeast Asia, Latin America, and Africa are rapidly industrializing and becoming more important to the world economy. To fuel this industrialization, ever increasing amounts of oil must be found, produced, and refined. Increased oil production has come from existing wells that have been exploited for many decades. Many advances in technology have allowed man to squeeze ever more oil from these oil fields. Yet no significant new fields have been discovered for many years. The refining capacity for any new oil would be severely restricted as oil companies have not invested in any new refineries or infrastructure. Regulatory limitations and recent low prices have created an environment where oil companies do not want the added liabilities. Any additional demand will severely stress the already deteriorated and fragile oil production infrastructure. Production from untapped reserves are limited by the simple fact that it takes years to meet regulatory criteria, drill wells, to setup production and lack of new refining facilities. In the US much of the known reserves are off-limits in such areas as the Alaskan north slope, Southern California coast, and Rocky Mountain Front.

Additional pressure on the world's oil supply is coming from the emerging economies of Latin America, Africa, and Asia. The added economic and political tension will only increase as competition for world oil supply intensifies. The third world emerging economies such as China and India with over one third of the world's population will require ever increasing energy as they become major suppliers of goods. The energy needs of China and India are projected to increase by at least 400% in the next decade.

All the while, the Middle Eastern nations of OPEC continue to gain greater share of the remaining global oil business in a politically unstable region of the world. Increasing prices could reduce demand, however, the world as we know it runs on oil. In truth "Hydro-Carbon Man" and his addiction to "cheap oil" is about to come crashing to an end.

PRODUCTION CAPACITY:

The debate over whether or not there is plenty of cheap oil is a moot point when one considers that there is not enough refining capacity to produce from any significant increase in oil production. The only country believed to have any excess production capacity is Saudi Arabia. Kuwait recently admitted that they are unable to meet their OPEC quota. This is a recipe for disaster.

CLASSIFICATIONS OF OIL:

There are generally two classifications of oil. These are "Conventional Oil" and "Non- conventional Oil." "Conventional Oil" refers to oil that is easily economically recovered. "Conventional oil" is that which is found and produced today from large oil fields. "Non- conventional Oil" is that which is or can be produced from a variety of sources at higher oil prices.

CONVENTIONAL OIL:

Conventional oil sources are those that can and have been exploited easily and profitably. The largest oil fields were the easiest to find and exploit. The largest oil fields, so-called "Super Giants" were found early on as there were usually many clues as to the existence of a large pool of oil. Much of the time oil would even be found at the surface in what are called oil seeps. As the geology of these large oil fields was more fully understood over time, other surface expressions were useful in finding oil. The sheer size of these "Super Giants" (basins or oil province) were the easiest to find with any given technology. The exploration for oil improved with technological advances with the use of refraction seismic, analog reflection seismic, digital reflection seismic, 3-D digital reflection seismic, and electric well logs. Eventually as these oil fields were exploited and new ones were found, advances were made in drilling technologies as well such as horizontal (directional) drilling. The search for oil has advanced offshore and there too drilling technology has improved with the use of offshore drilling barges to deepwater drill ships, jack-up drill-rigs, and semi-submersible rigs.

In all probability, all the major oil basins or provinces have been found and the world is in effect, truly running out of oil. At least out of easily exploited conventional oil. In fact, the peak year for oil discoveries in the US was in 1930, and the peak for worldwide oil discoveries was in 1962. Discovery rates have steadily fallen since. In fact, most increases in oil production since then have come from technological advances that were applied to already discovered oil fields. 3-D Seismic and horizontal drilling techniques improved oil recovery in known fields, but have not resulted in any significant discoveries of major fields.

NON-CONVENTIONAL OIL:

Much has been discussed about non-conventional oil sources and alternative energy sources. It is true that there is a substantial amount of non-conventional oil. The problem of course is that it is much more costly and much of this oil is not economically recoverable at current prices. The Oil Sands of Canada's Athabasca region may have as much as 900 billion to 1.3 trillion barrels equivalent oil (maybe 300 to 600 billion recoverable). The wholesale processing of tar sands (effectively asphalt) is difficult and the impurities creates a whole set of environmental problems as it is mined and therefore is likely to face a lot of political pressure. There are at least 2 major producers in the region: Syncrude (a consortium of oil producers), and Suncor (SU). The same problems arise from even more difficult oil shales. The problems of course are the included heavy metals and sulfur content.

Some non-conventional oils are those that are not easily recoverable and also are difficult to process. An example is the massive deposit of heavy oil sludge such as that found in the Orinoco Belt. The Orinoco Oil Belt in Venezuela is thought to contain 1.2 trillion barrels of heavy oil sludge. The Orinoco Belt, or "Faja" of eastern Venezuela may become a major source of oil, yet this is a costly enterprise as this heavy sludge may not be easily recovered. This sludge has been described as having the consistency of peanut butter. The belt is a thick lattice of ancient river beds about 280 miles (450 kilometers) long and 60 miles (100 kilometers) wide. The heavy oil must be warm enough to be pumped and specialized horizontal drilling rigs are used. To keep this oil moving, solvents are used to dilute the oil before it cools and hardens. Obviously this will be not only costly to produce, but since it is still a heavy oil even after it is upgraded for shipment, the additional processing at the refinery will also be costly.

Other possibilities do exist. Liquid natural gases and condensates could be a source of fuel. Unfortunately, the need for clean burning fuel for the current generation of power plants for the world's power grids mean that the competition for natural gas will become intense. The difficulties of liquefied natural gas (LNG) can be easily illustrated by a short case study of such a project in the small Arab country of Qatar on the western coast of the Arabian Gulf. Qatar has the third largest natural gas reserves in the world, and the country's North Field is the world's biggest source of non-associated natural gas (that is natural gas not associated with oil). The field has reserves of more than 500 trillion cubic feet - 3 times greater than in the entire US. Qatar is developing the capacity to deliver almost 11 million metric tons of LNG annually for sale to power companies and other customers in a number of Asian and European countries, as well as the United States. Natural gas is piped from the field to a processing facility. It is at this processing facility where the natural gas is liquefied by chilling it to -260 degrees Fahrenheit and transporting it in newly designed tankers with nickel and steel membranes. Once these tankers reach their destination, the LNG is regasified and consumed as pipeline natural gas. Obviously this will help offset some of the coming oil crunch, but a lot more specialized tankers and a lot of infrastructure needs to be built.

The possibilities do exist for clean energy from nuclear power. However, nuclear power is politically incorrect and faces regulatory and political pressures that make it an economic uncertainty. The Three-Mile Island and Chernobyl nuclear power plant accidents are still fresh in most peoples memories. Nuclear power in some countries is still acceptable (such as france and Japan) and may help relieve some of the pressure on limited oil reserves. Solar and wind power also face opposition as the infrastructure requires vast tracts of land and may impact on some wildlife. Solar and wind power are not likely to become widespread sources of power as they are climate dependent and it is not easy to store electrical power for use when needed. Another relatively expensive possibility is the development of Biomass fuels such as ethanol. The problem of ethanol is that it requires much more energy to create than is ultimately obtained. Ethanol that is used in reformulated gasoline is only available because of government subsidies. Non-conventional natural gas will become increasingly important. Coalbed methane (absorbed into coal molecular structure) is produced from wells drilled into coal seams. NG from gas shales require fracturing and pending recent requests for environmental legislation in the US to restrict Hydro-fracturing, this resource may ultimately become unrecoverable. NG in Artic regions and deepwater are problematic at best. Hydrates (methane ice-like solids) in Artic and oceanic regions are presently unrecoverable and do not migrate into commercial traps.

There is another classification that fits under the heading of non-conventional oil and that is oil in the conventional oil regimes that require uneconomic measures for exploitation. This includes oil that is in small oil traps that is currently uneconomic at current prices. Such oil is found in mature oil fields, and requires that wells are drilled near existing primary wells to access these small pockets of oil. Also oil that requires extraordinary measures such as steam, water or gas injection to force oil to migrate to where it is economically recovered could be considered non-conventional oil.

NEW ECONOMY AND OLD ECONOMY:

The financial analysts, government parrots, and media drones continue to rant about the new economy and occasionally attempt to describe how oil is not very important in the world's economies and therefore rising petroleum prices are no threat. They even continue to ignore the importance of petroleum when calculating core inflation statistics for the Producer Price Index (PPI) and Consumer price Index (CPI). They even use dishonest measures in these calculations by incorporating dubious valuations derived from "Hedonic Deflators" and "Seasonality" statistics. These fools overlook the big picture and the importance of petroleum in the economy (New or Old). The claims are that Hydro-Carbon Man no longer needs oil because now he has communication through the Internet and the invention of the computer. He can buy his toys through a computer and a phone line. If it were only that easy.

The Old and New economy debate can be misleading. The future economy is likely to blend traditional business (Old Economy) with new developments and inventions (New Economy). The question is where does petroleum fit into this future economy? It is only obvious to even the most causal observer that energy and petrochemical use will grow several fold because they are so embedded in our economic life and power the engine of economic growth. The use of plastics (derived from oil) has increased and will continue to do so. The invention of the personal computer and development of the internet assures that electrical use will dramatically increase and thereby consume much more energy. Products purchased over the Internet will be delivered by conventional means such as by courier (i.e. United Parcel Service, Fed-Ex., Postal Service, etc.), consuming ever more energy rather than delivered to a central location where the consumer can retrieve several items at a time. As more people and countries join the new economy, ever more energy will be consumed.

The world's population continues to grow and recently surpassed the 6 billion mark. Agriculture is stretching its limits. Food is cheaply produced. Much of that cheap production is directly related to mechanized farming and the cheap production of petrochemicals such as fertilizers and pesticides. Without these petrochemicals, agricultural productivity would drastically decline. Approximately 90% of the energy in crop production is oil and natural gas. About a third of the energy is to reduce the labor input from 500 hours per acre to 4 hours per acre in grain production. About two-thirds of the energy is for production, of which about one-third is for fertilizers alone. Agricultural products are delivered to cities and remote areas by vehicles that run on oil.

POLITICAL STABILITY:

A major problem in many of the oil producing regions around the world is political stability. Saudi Arabia and Kuwait have many social problems. Social programs are dependent on oil. The only business in most of these countries is the business of oil. The threats of war and internal strife are always a concern. Iran and Iraq have been to war and both have ethnic derision from minorities such as the Kurds who desire their own homeland. Saudi and Kuwait have had their own difficulties with Iran during the so-called "Desert Storm" event, and both must keep a wary eye on Iran. Even now Iraq accuses Kuwait of sniping it's oil along the border and has threatened renewed military action. The possibility always exists that another Arab-Israeli conflict could arise. There are numerous possible events that could disrupt oil supplies from the middle-east. As oil supply becomes tighter, we could expect the next president of the US go begging the Iraqis and Iranians for oil and better diplomatic relations. Israel could even eventually find itself without a benefactor.

The oil producing regions of Africa and South America are also vulnerable. Angola and Nigeria have been through several civil wars, and the current governments are young and constantly under threat from renewed internal conflict. Venezuela has elected a socialist that has openly praised Fidel Castro of Cuba as a hero of the people, and has also instituted economic and political changes that could erupt into civil strife as well. Colombia has oil reserves, pipelines, and refineries that are under constant attack by revolutionaries (bandits?). The tight supplies of oil could be disrupted at anytime and therefore the threat to the world's economies from political instability is very real.

The Rise and Fall of Hydro-Carbon Man" - Part II

GOLD - OIL LINK:

The coming oil price shock/oil crisis will make the last temporary oil price shocks look very mild in comparison. On January 21, 1980, the price of gold on the London fixing set a record at $850 an ounce. This ended an inflationary decade of oil price shocks, freezing of Iran's assets and Soviet invasion of Afghanistan, which sent investors rushing for gold and silver. The average London price of gold for the year was $614.63 per ounce. Could it happen again? You bet it will. Gold has it's own intrinsic value and several thousand years of history is not about to vaporize and disappear. As philosopher George Santayana stated, that those who forget history are condemned to repeat it.

Every postwar recession has been preceded by a rapidly rising price of oil. Gold prices lagged the price of rising oil, yet the price of gold eventually rose as well. The question one must ask: If oil is rising in price, then why is gold not rising as well?

When the price of oil had risen in the past due to OPEC oil supply disruptions, the price of gold responded with a price rise as well. In 1974 gold rose 20% in response to the Arab oil embargo, and in 1979 gold also rose over 125% in response to the overthrow of the Shah of Iran and subsequent Iranian revolution and hostage crisis. Oil and Gold have had roughly a 15 barrels of oil to 1 ounce of gold ratio. If this ratio were to be stable, then at today's $35.00/bbl, gold should be valued at $525.00/oz. If oil were to be priced at $50.00/bbl as some sources expect will likely happen, then gold should rise to $750.00/oz. Oil at an inflation adjusted value of $140.00/bbl that roughly matches its past record high, then gold should reach $2100/oz. (similar to recent projections in Forbes magazine).

Another way to look at the oil-gold relationship is to compare pricing during the 1973 Arab oil embargo and into 1974. Oil rose in price from $2.00/bbl in 1971 to $10.00/bbl in 1974, or a 500% increase in price. Following the relationship of the oil-gold ratio, an increase of 300% in the price of oil (similar to recent prices) should yield a price of $962.50/oz. for gold. A similar increase in the price of oil as the 1973 500% increase in the price of oil should yield a price of $1375.00/oz gold (based on a recent $275.00/oz gold and a projected $50.00/bbl oil). These back of the envelope calculations are based on the recent price of gold at $275.00/oz, which in my opinion is grossly undervalued, so it would appear upon closer examination that gold could and should increase much more in value. However one were to look at it, the oil:gold ratio appears to be out of balance and is due to readjust to the norm.

GOLD MANIPULATION:

Why is gold priced so low? If some are correct in their assumptions that the Saudi's and others in the Middle-eastern countries prefer payment in gold for oil (as per the 1920's oil deals), then they also have an interest in having a low gold price vs. a high oil price. This yields more gold per barrel of oil. This is unsustainable of course and eventually the lid will blow off unless some powerful forces cap the price of gold. The current gold prices are unsustainable in face of a growing energy crisis. As the price of oil continues to rise, the producers will not be very excited about receiving devalued dollars for their diminishing natural resource. The Central Bankers know that there is pressure on gold so there is a concerted effort to malign the perception of gold as portfolio insurance and as an investment. That is the primary reason for the Bank of England auctions, and the various other auctions that have come from European central banks and from the little CB's that can be leaned on to submit to their stronger cousins. This is only a temporary measure as it cannot continue indefinitely. There is not enough gold to continue with this charade forever. The longer it continues, the more explosive the rise in the price of gold. This is apparently the reason for the frantic efforts by so-called "Gold Analysts" at the major Bullion Banks who engage in hysterical effort to talk down gold prices and damage gold's reputation as a hedge against inflation.

The situation is more dire as one recognizes that the LMBA and Bullion Bankers have loaned out millions of ounces at ridiculous interest rates to those who sell short gold and then invest the proceeds in the equities markets or in higher yielding government paper and scalp the spread (Gold Carry Trade). Simply put - that gold is gone. The forward selling gold producers borrow gold, sell it, and usually use the proceeds to advance their mining operations. Some miners, however, act as hedge funds and invest in higher yielding government paper and they too scalp the spread. When these miners get in trouble and go bankrupt, the counter-party bank is on the hook. It is in the best interest of the LBMA and Bullion Bankers to maintain the illusion that gold is abundant and move the price lower in an effort to discourage gold investment. A sharp rise in gold prices would likely result in "margin-call" requirements that could level many financial institutions and hedged miners.

Eventually, something has to give. As the price of oil continues to rise and the ripple effects work through the economy in the form of higher prices, that is inflation in spite of government manipulated gauges of inflation such as the Bureau of Labor Statistics US Consumer Price Indices (CPI) and Producer Price Indices (PPI), the price of gold will explosively rise in value like a tidal wave as it is recognized as a hedge against inflation. The Federal Reserve Bank is trying to slow the economy with mild on-again and off-again interest rate hikes in an effort to engineer a "soft- landing" This is likely to fail as it has in the last 8 out of 10 times it was attempted. The odds are against it. It is a delicate balancing act between adjusting interest rates and money supply. Once inflation is truly felt, then people will run to hard assets. If oil rises to $50.00/bbl, then the government will have an extremely difficult time hiding and manipulating the inflation figures.

PRECIOUS METALS AND PREPARATION:

Physical precious metals are not an investment as much as insurance for the possibilities of economic disaster, natural disaster, or even temporary disruptions such as family tragedy, illness or unemployment. Many people prepared for possible disruptions to everyday life in advance to Y2K. Fortunately there were few problems encountered during the transition from 1999 to 2000. Those who prepared for Y2K and remain so now are better positioned for the problems that may be encountered during the coming energy crisis. A prolonged recession should be expected. In a worse case scenario, hard assets such as gold, silver, and platinum bullion and coin will transfer wealth across any pending disaster. We have health insurance if we become ill or am injured, we have life insurance for our heirs should we pass away, we have insurance if we have an automobile accident, and we have home insurance in case our homes are damaged or destroyed. Does it not make sense to insure our investment portfolios as well?

Hard assets are king when all hell breaks loose. Is it any wonder then that George Soros buys vast tracts of land and in the Silver miner Apex Silver (SIL), that Bill Gates purchases 10.3% of Pan American Silver (PAAS), and that Warren Buffett purchases 137 million ounces of silver and keeps it offshore out of the grasp of a potentially hostile US Government? Does it not seem reasonable that one should follow the lead of those who are supposedly in the know? Why stop at hard assets? Have a storage program of food, water and necessities in storage in case of unemployment, natural disaster, or worse. Get out of debt as soon as possible. Get a well-stocked first-aid locker. Get firearms and ammunition for hunting wild game. Maybe even a wood burning stove and plenty of fire wood. Disaster may not come, but many people tend to sleep better at night knowing that they have "battened down the hatches" so to speak. Think of the panic during the Cuban missile crisis as people rushed to the super markets and stripped the shelves bare. Why even when Johnny Carson on the "Tonight Show" a few years ago on US television joked about a toilet paper shortage, he unwittingly created a shortage as people rushed to get plenty of toilet paper. You see, anything can happen, but then I (and a few others) sleep very well at night.

CONCLUSION:

We have already learned the consequences of an oil crisis. In 1973 during the Arab oil embargo, the resulting higher costs were passed along to the consumer and the world's economies were thrown into recession. Those of course were only temporary blips. The world's economies are addicted to cheap oil. The new oil shock is coming and it is permanent. Hydro-Carbon man is going to suffer the effects of forced Hydro-Carbon withdrawal. Oil supplies from mature oil fields are diminishing and no new significant discoveries are being made to replace them. Current reserves have been inflated for political and economic reasons. Alternative and non-conventional energy sources are more costly and most are not likely to be recoverable. The discovery of new fields is not keeping up with current depletion rates. The crucial point however, is not when the world "runs out of oil," but rather the half-way point when production is no longer is increasing and when it begins to decline (Hubbert Peak), and ever increasing demand for oil forces prices to rise dramatically. There is a finite amount of oil. As oil reserves are depleted there will be rampant inflation and irreparable damage to economic growth. It is possible that much of the "non-conventional" oil may be eventually recoverable with new technology, new refining methods could conceivably be developed, and reclassified as "conventional" oil. However, at current prices these "non-conventional" sources are not profitable. The current infrastructure and refinery capacity limits our ability to keep up with demand. The world is an unstable place and the inability to expand energy only makes the world more unstable. The ratio of the historical oil to gold relationship is severely out of balance and offers a unique opportunity in gold (and silver) investments. Gold is about to reassert itself as a hedge against the coming inflationary pressures and world turmoil. "Hydro-Carbon Man" must adjust to his new environment of declining energy resources, higher energy costs, or go extinct.

RECOMMENDED READING:

Campbell, C.J., The Next Oil Price Shock: The World's Remaining Oil and Its Depletion," Energy Exploration and Exploitation, v. 13, no. 1, 1995, p. 36.

Campbell, C.J., The Coming Oil Crisis, Multi-Science Publishing Company & Petroconsultants, 1997.

Campbell, C.J., and Laherrere, J.H., The End of Cheap Oil, Scientific American, Mar. 1998.

@darkhorse � totally agree with you about many of us not having understanding of all information through personal experience. Atrocities on both sides make this developing situation all the more difficult to grasp.

@DOWNUNDER � G'day. Trying to understand what the facts are help to better comprehend the world at large. I have no opinion on the subject and certainly don't want to pass judgement on who is right or wrong. Like many people I don't have a clear understanding of most of the facts anyway, that is why some of the facts, if true, I found interesting.

Yes the e-mail was one sided and that is why I asked a few questions in my commentary; rhetorical questions that highlighted such concerns. I would have also liked to receive an e-mail with a Palestinian view but didn't. Thanks for the heads up as next time I will be clearer so as to be better understood when posting, especially with such a touchy subject.

http://www.financialsense.com/stormwatch/update.htm
Snippit:

During the 70's the U.S. experienced a loss of confidence in government and in financial paper. The period was characterized by a series of policy failures that directly contributed to a rise in inflation. Investors preferred to put their money in tangibles rather than intangibles. These graphs of gold, silver, and oil show the tremendous price rise of key commodities during this time. Other commodities such as grains, cotton, and base metals also rose in value. Everything tangible from gold, oil, real estate, and rare art to collectables rose in value. The stock markets languished during this same period as reflected in the previous graphs of the Dow Industrials. If you made money in stocks, it was mainly in small cap companies or the commodity producers.

Basic Needs and Population

My observations lead me to believe the next big move will be in commodities. I believe it will be driven by supply and demand factors aided and abetted by a growing world population. Food, water, and energy are necessities. These items aren't optional, but are considered basic necessities of life. Without them, civilization would perish. At the end of the last century, world population was estimated to be 6 billion. By the year, 2020 global organizations from the World Bank to the UN estimate the human population on this earth will grow to 9 billion people, a fifty percent increase from where we are today. This population growth will become the primary driver of the demand for commodities of all kinds, will special emphasis on clean water, energy, and food. This demand for basics will take place regardless of the condition of the economy be it inflationary of deflationary.

Central Bankers' Two-Front War

For these reasons it has been necessary to maintain confidence in all things financial be it stocks, bonds or currencies. Central bankers are fighting a two-front war. One front is in the financial system that requires constant injections of liquidity to hold back the debt defaults and prevent the system from collapsing. The other battle is to prevent users inside the system from shifting their funds to an alternative medium such as gold, silver, oil or any other tangible good that would compete with paper and credit. It is a lot like a fork in the road. On one side is the credit and paper money system that makes up the world's financial system. On the other road are tangible goods such as base metals, oil, silver and gold. The war is a constant battle where the public must be corralled on the one side of the road. Therefore, in a crisis, the only alternative is to shift from one paper asset to another rather than exit the system for the other side of the road.



Black Blade: A new Puplava report. Are we due For a Repeat? I say that it's very possible. Much is discussed in Puplava's article (a good read).

As always, get out of debt, get Gold and Silver portfolio insurance, get enough cash on hand for several months expenses, and start a nonperishable food and basic goods storage program.

Still NOT yet recognized by the vast majorities of Dollar-blind, that the euro's alternative for STABILITY is Crucial ! Morgan Stanley for instance, classifies the euro in the Gold / SwissFr line !? As if the euro is a temporary refuge for temporary dollar-problems and holds nothing more than that. (mistake of course)
The euro is hesitant to show its real ambitions. Ambitions to overthrow Emperor Dollar ! Not an easy task, as we all do know. The plan/concept is there but some fear/hesitation to execute/materialize it,... reigns. The euro/gold-concept, needs the help and alliniation of Arabian oil. And it must be here that doubts might exist. Doubts about present or future division between Arabian oil producers themselves. Euroland and allies Doubts about the not foreseeable consequences of a substantial dollar fallout.
Doubts about the scale and intensity of US retaliatons.
These doubts must be living in Germany ! The French have much more selfconfidence (flexibility) on these matters.

A New Free Market for Physical Gold Trade, combined with another currency (the euro) must have some flaws and weaknesess. Can there be another kind of manipulation or unbalancing of power shifts ? Hot soup, isn't it ?

An alliance of Euroland + China + Russia + ME is quite a BIG piece of cake to put it undamaged on the currency table.
That's why the introduction of the "concept" must proceed with extreme care and precission. The architects and builders are a small minority of CEOs.

Whatever Welteke and his German faction might have in mind, is subordinate to the reality force and intentions of oil-euro allies. The POO and its consequences will inevitably bring the euro on the foreplan as the better "STABILITY" factor and tool ! Simply because of the *POSITIVE* Gold-Connection in blatant contrast with what the dollar has always stood for,... a Gold rival!

It is or the euro as a special (better) currency or the POO that will set Gold Free ! Both euro + Gold will enhance and perpetuate the initiated Gold move.

ST technical interpretation on POG : If 297,6$ holds a mini inverse SHS (bar-chart) is in place and a fib. target of 329$ is the next attraction point. Will see if POG rise has dramatic consequences for the shorters (Deutsche Bank included), already unloading their threathening derivatives or not ?

http://www.financialsense.com/Market/wrapup.htm
Uncertainty of War

Snippit:

There were three factors that influenced the markets this week: 1) tensions in the Middle East, 2) economic numbers, and 3) earnings warnings. The ongoing tensions in the Middle East had the greatest impact on the markets with worries of the conflict erupting into a regional conflagration. Suicide bombings continued all week as Israeli troops took over and occupied many key Palestinian towns. The uncertainty of war breaking out in the region and the impact it would have on the oil markets helped to keep energy prices high this week. The Bush/Powell peace initiative helped to cool down tensions, which resulted with oil and natural gas prices pulling back by the end of the week. But there was still a sense of unease with investors with so many unknowns having no closure.

The Economy

This week the data was mixed with most economic reports indicating a weakening economy. The week began with a drop in U.S. factory orders, which fell in February. This report contrasted earlier reports on the manufacturing sector that indicated the 18-month slump was beginning to recover. Factory orders fell by 0.1% in February, the first drop since November of last year.

Other reports out this week showed the unemployment rate rose last month from 5.5% in February to 5.7% in March. It looks like those numbers may go even higher with a sharp jump in jobless claims this week. The number of Americans filing unemployment claims jumped from 396,000 to 460,000. Companies continue to downsize in an effort to squeeze costs down. In this competitive environment companies lack pricing power due to still competition, so what is left is companies are reigning in costs, which means further reductions in payroll.


Black Blade: I had thought to comment on the rise of 58,000 new jobs vs. the rise in the unemployment rate. How can this be? Simply put we are looking at more BLS trickery. These are "seasonally adjusted" numbers (read statistically manipulated) that ignore many thousands more who are out of work from various sectors that are conveniently ignored (otherwise there would be too many embarrassing questions to address). Remember that Februarys 66,000 new jobs disappear to be readjusted to a 2,000 lost jobs ("seasonally adjusted" ones of course or the losses would be much greater). Notice how the Trolls on CNBC and other media focus on the new jobs while neglecting to refer to the unemployment rate rising from 5.5% to 5.7%. More and more US economic data makes little sense � all that is required as far as the BLS is concerned is that enough people are fooled. Fooling the US public is becoming a more difficult proposition each day as trading volume on US markets have fallen off a cliff, unemployment rolls keep growing, corporate and consumer debt grows rapidly, corporations warn on earnings at a growing pace, corporate accounting scandals appear daily, public confidence reaches for all time lows, etc. The House of Cards is wavering and ready to fall. We do live in "Interesting Times".

http://www.usatoday.com/money/markets/2002-04-05-gold.htm
Snippit:

LONDON (Reuters) � The Middle East's plunge into turmoil has driven gold prices toward their highest in more than two years as investors scramble for a safe home for their money. Gold prices have gained nearly 4% this week as Israeli tanks and troops poured into the West Bank in reprisal for a wave of Palestinian suicide bombings unleashed in Israel. With the West Bank in turmoil, speculation rife over a U.S.-led attack on Iraq and ongoing military deployment in Afghanistan, gold's reputation as a retreat in times of trouble has shone through.

Bullish gold fundamentals, including falling supplies from mines worldwide and a reluctance by producers to sell unmined nuggets in forward markets, have also underpinned the rally. "There's more interest being seen in gold now than in the last 15 years. There's been a mindset change," said Peter Hillyard, senior manager at ANZ Investment Bank. "Israel, Iraq, additional troops in Afghanistan, higher oil prices � the list is endless. In that environment gold goes up. ... There's enough going on to add gold as a portfolio diversifier," Hillyard said.

In local currency terms, gold prices in India, the world's top consumer, were at five-year highs and at nine-year highs in Australian dollar terms, Norman said. Japanese savers, worried over the safety of their bank deposits and the yen, have also scurried into gold to bank a dollar-denominated asset away from a lumbering stock market. Gold was trading in London at $301.00/301.50 on Friday, off its highs after President Bush called for a halt to Israel's weeklong drive into the West Bank and a withdrawal of Israeli forces from the area.


Black Blade: The list is endless indeed. Meanwhile the Bankers, Investment Houses, and Central Banks are walking a tightrope�..one misstep anywhere and the POG is off to the races once again.

http://www.oregonlive.com/business/oregonian/index.ssf?/xml/story.ssf/html_standard.xsl?/base/business/10180113662067117.xml
Snippit:

Portland General Electric ratepayers will spend the next 31/2 years paying for an energy crisis that lasted little more than 12 months. This week, PGE's 738,000 customers began reimbursing PGE for $90.9 million in unanticipated electricity costs incurred last year when wholesale power prices skyrocketed. The payments will continue through August 2005.


Black Blade: The lack of preparation is costly. Yet the "Grasshopper" mentality has set in again � outta sight, outta mind. At least until the next "Energy Crisis".

http://news.bbc.co.uk/hi/english/business/newsid_1912000/1912201.stm

Snippit:

The dispute between Venezuelan oil workers and the government has intensified, increasing the risk of a supply squeeze. Protests already caused some disruption to oil supplies on Thursday, and the workers at state-owned oil firm PDVSA vowed to step up the strike on Friday. "Workers of all sectors of PDVSA are starting today a progressive, collective suspension of work in operational and administrative areas," a spokesman for the group said.

The news comes amid growing concern over global oil supplies due to political troubles in the Middle East. Venezuela is the world's fourth largest exporter of crude oil and is a key supplier to the US market.


Black Blade: Venezuela is the largest oil importer to the US.

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=APK3RFRRlQWxjb2Eg

Snippit:

Pittsburgh, April 5 (Bloomberg) -- Alcoa Inc., the world's largest aluminum company, said first-quarter profit fell 46 percent and sales dropped because slumping demand from aircraft and automotive makers eroded prices. Earnings fell to $218 million, or 26 cents a share, from $404 million, or 46 cents, in the year-earlier period, Alcoa said in a statement. Sales declined for a third quarter in a row, dropping 19 percent to $4.98 billion.

Black Blade: Amazingly, yet not surprisingly, the spin from the media Trolls was that earnings fell 46% but "beat analysts estimates". Hmmm� This ridiculous spin has to be getting old. That is reflected in extremely low trading volumes on Wall Street.

http://highlandenergy.com/
The American Gas Association (AGA) has stated that natural gas in storage is at very high levels compared to last year. That may or may not be true due to disputes about sample population collection, data acquisition, and the methodology used. However, it should be noted that withdrawal rates have been exceptionally high � at times several times the withdrawal rate of last year. Natural Gas is the real sleeper that is slipping below the radar.

Note from the graph (at the link � click on AGA Storage, then graph or table menu) that storage levels are not all that much out of line compared to previous years.

The reason for such low natural gas storage levels last year are due to the booming "New Economy". In fact ever-more energy is consumed as more computers, Internet backbone, server farms, telecom infrastructure, etc. are built and used. This dramatic growth in the "New Economy" helped to create last years "energy crisis" as demand outstripped energy supply.

Natural Gas demand has been increasing at a very rapid pace as new power plants have been built in response to last years "energy crisis". Virtually every new power plant being built or planned is natural gas-fired due to environmental and political regulations that make coal, oil, and hydroelectric less desirable. Fuel cell technology will eventually be built, however, the fuel here is also natural gas (easier and energy efficient to break four hydrogens from one carbon than it is to break two hydrogens from one oxygen). That will of course add more pressure to natural gas supply. The new energy commission in California is studying this possibility with stacked fuel cells (daisy-chain) for critical centers such as hospitals, government services, etc.

Natural Gas demand will rise as aging nuclear power plants are retired or shutdown for maintenance. Recently boric acid corrosion has become a concern as the Besse-Davis nuclear power plant near Toledo has been found to be damaged. There are 69 such nuclear power plants (Three Mile Island design) that may be shutdown for inspections and possible repairs. The whole process may take anywhere from 90 days to 2 years.

Hydroelectric power is becoming questionable due to drought in many parts of the US. On the East Coast from New England to Georgia, drought has been enough of a concern that some regions have implemented water restrictions. There will be a greater reliance on other sources of power as water levels will likely be kept high as possible in some rivers for environmental reasons.

Coal-fired and Oil-fired power generation will probably be restricted due to lack of "carbon credits" that are routinely traded among power producers. Older plants are being retired after many years of use and the switch has been to natural gas while "carbon credits" are used to keep other older power plants operating.

Drilling activity for natural gas exploration and production has fallen to very low levels (Rig counts are far below last year's levels). This may result in a shortfall in supply this coming fall and winter � at the worst possible time. Production has already fallen by nearly 3% while decline rates in several fields have increased by as much as 29%. As reserves are not being replenished the outcome is almost a forgone conclusion. Last year with record drilling activity, production increased only 2%. The AGA storage data could very well be misleading and giving a false sense of security. If the economy is in recovery as some economist claim (doubtful), then we may find a different kind of "October Surprise".

- Black Blade

As far as I can remember, the number of truely large gold discoveries is really quite limited. The Goldstrike mine in Nevada for all intents and purposes has built both Newmont and Barrick into what they are today. You have the Yanacocha mine in Peru, The Red Lake Mine of GOld Corp which is really the same ore body as the Placer Dome Mine Campbell Mine,a thousand yards away, and numerous other large districts in the world that have two or more mines sharing them and produce a million ounces or more. Not many of those type babies out there. And really you need that kind of economies of scale and high grades to be producing at the kinds of low total production costs that you need to stay in business at $300/ounce gold. We keep hearing about the ability of the mines to flood the world with production but realistically unless the technology has changed significantly in the last six years, even at $400/ounce the number of new production mines that could produce above 500,000 ounces per year is rather limited. I would be interested in a discussion where we shared our collective knowledge about what is out there in terms of potential new finds or more likely old fines that became uneconomic at sub $300/ounce gold and now might have a chance of comming back. Anyone interested? I don't mean touting various juniors by the way but talking about where the gold districts that could be brought back are and who has the best mothballed type of properties. As we all know the number of actual exploration plays that are out there is very limited. What do you think? I hope you understand that there can be a difference between sharing areas of potential and touting spec stocks. I have no interest in the latter, thanks. But there are some commodity discoveries of the past that might be finally starting to pay off. LEt me know if the members of the table think this is not doable.

Germany : "Welt am Sonntag" (World on sunday-Finance) by Ulrich Reitz : Translation
Bundesbank president E.Welteke made a beautifull eastern present to his friend (!) Financeminister H. Eichel (SPD-Socialist Party Deutschland) with the past intervieuw on Germany's Gold reserves (parts of) for interest bearing (German) stocks (utilities-RWE-?). Welteke will elaborate on what exactly he was suggesting previously on april the 11.
H. Eichel is happely waiting to see if sleeping Gold will be exchanged and handed over for interest producing paper.
Welteke's plan will bring nothing to compensate for the Brussel's deficit criteria. That was stated by the CBs. No more sales before 2004 (W.Duisenberg.)

April 11 will bring exclusion on this ridiculous little "political" (small) play that Welteke has been bringing. First statement was to test the water. Duisenberg responded and now the finale on april 11. Very little storm in a very little glas of water.

When you Google on Welteke's past intervieuws, you get a nice picture on his personality ! Judge it for yourself.

Finally!... some serious Media coverage....If Chris already posted this then please forgive me...YGM
*********************************************************

Le Metropole Members,

[GATA] GATA cracks U.S. news media blackout
Date: 4/4/2002 8:25:39 PM Central Standard Time
From: GATAComm@aol.com
To: gata@yahoogroups.com

9:08p ET Thursday, April 4, 2002

Dear Friend of GATA and Gold:

A remarkable financial market commentary that
centered on GATA's work was distributed
yesterday by the Knight-Ridder/Tribune news
service and published at the CNN and London
Evening Standard Internet sites.

While we don't know at this hour how extensively
the commentary has been published in the United
States, the Knight-Ridder/Tribune news service is
delivered to many major newspapers owned by that
company, including the Chicago Tribune, Philadelphia
Inquirer, and Miami Herald. So with this commentary,
we have finally cracked the U.S. media blackout
on the scheme to suppress the gold price.

This is all the more delightful because GATA
has not had any direct contact with the commentary's
author, Richard Morrissey, publisher of
www.CreditCurve.com. That is, GATA's work has been
reaching many people in the financial markets despite
the U.S. media blackout.

So don't despair at the dismissal of Reg Howe's
lawsuit in U.S. District Court in Boston. The
suit is not only is still alive with the motion
Howe has just filed for a revision of the
dismissal judgment, but the suit already had
brought the gold-suppression scheme to an
international audience. Exposure of that scheme
remains our biggest weapon, and we continue to
attack with it.

The Morrissey commentary appears below, along
with the Internet link to it at the CNN site. If
you use the link, please close any spacing that
may appear in it in this dispatch.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

http://cnniw.yellowbrix.com/pages/cnniw/Story.nsp?
story_id=29040017&ID=cnniw≻ategory=Metals+%26+Minerals%3APrecious&

Gold Aims to Recapture Its Lustre
As a Safe Hedge in Troubled Times

By Richard Morrissey
Knight Ridder/Tribune Business News
April 3, 2002

After years of playing the part of Cinderella
to other more-favored financial assets, gold
is finally shaking off its dowdy image and
taking a shot at gaining the prize for best-
performing asset market of 2002.

Since 1997, $300 an ounce has been a ceiling
for gold as a combination of central bank
auctions and lending to hedge funds, forward
sales by gold producers, and the much-touted
death of inflation conspired to keep the
price well below its historic high of $870
hit in 1980.

To those gold bugs who have never given up
hope that this once-lauded store of value
would again take its rightful place in the
pantheon of credible financial instruments,
the poor performance of the commodity has
been nothing short of a conspiracy.

Indeed, according to many gold aficionados,
particularly those at the Gold Anti-Trust
Action Committee, the U.S. Federal Reserve,
the U.S. Treasury, and European central
banks, in league with major U.S. investment
banks, have conspired to keep the price of
gold low.

Gold broke through the $300 level to reach a
two-year high of $307.80 on 8 February. But
the move did not last long, and as the price
drifted off German Bundesbank President Ernst
Welteke conveniently speculated that Germany
might at some stage start selling gold. The
timing of his statement was seen by many as
an attempt by the central banks to ensure the
price of the commodity remained capped below
$300. However, the price has since rebounded,
trading back above the key $300 level last
week.

The latest rebound has been driven by new-
found interest from the hedge funds, many of
which are betting that persistent selling by
large investment banks to keep the price
down, and central bank comments to achieve
the same end, will ultimately fail to cap the
upward trend.

Indeed, the talk now is that this so-called
cartel is about to get its comeuppance, with
some gold optimists suggesting gold may hit
$600 or even $1,000 an ounce.

The Enron scandal has brought to the fore the
issue of cartels and especially the role of
so-called bullion banks that reportedly have
very large short positions in gold via the
derivatives market. These are now being
squeezed as the price of the commodity rises.
Indeed, there is wildfire speculation among
some U.S. gold watchers that if the price of
gold moves even $20-$30 higher we are going
to see these shorts getting hammered.

There are plenty of other reasons why gold
and gold-related stocks are worth serious
consideration. As well as Enron, the markets
also have to contend with Argentina's debt
default and the huge bankruptcy cases of U.S.
companies.

Another factor favoring gold is the
quadrupling of purchases of bullion by
Japanese consumers worried about the safety
of their bank deposits. Also, investors in
the Middle East have started to actively
purchase the metal as tensions over Iraq,
Israel, and Palestine mount.

Finally the all-powerful U.S. dollar, which
has held up remarkably well in the face of a
weaker U.S. economy, evaporating corporate
profits, and heightened worries over the
threat from terrorism, may be set for a
downturn, which usually means higher gold
prices.

Against this backdrop there is a genuine case
for thinking that gold provides an attractive
hedge against financial and political stress.

However, gold has to become more than just an
icon of gold bugs, conspiracy theorists, and
short-term speculators. Instead it needs to
broaden its appeal as an asset among
mainstream investors anxious to protect
themselves in an increasingly uncertain
financial and political environment.

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

Richard Morrissey is publisher of
www.CreditCurve.com.

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

COIN AND PRECIOUS METALS DEALERS
WHO HAVE SUPPORTED GATA
AND BEEN RECOMMENDED BY OUR MEMBERS

Centennial Precious Metals
3033 East 1st Ave.
Suite 403
Denver, Colorado 80206
www.USAGold.com
Michael Kosares, Proprietor
US (800) 869-5115
Canada 1-800-294-9462
European Union 00-800-2760-2760
Australia 0011-800-2760-2760
cpm@usagold.com


***Many other Coin dealers omitted here by me as per advertising rules. But USA GOLD is at the "TOP" of the list.......YGM.

Just to bring it into focus on a real life level,
Every child born in this country is starting off with a debt of over $20,000.
That's right.
Every one of us owes more than $20,000 on top of any personal debt we have run up.
If the government balances the budget from here on in, we will all have to pay $133 per month for the next 30 years to pay off
what has already been spent. (at 7% interest).
Yes that's right.
For a family of four that's $532 a month.

History can only be made in the context of preceeding events.

I saw Hamilton's recent essay on oil/gold ratio's (tks Waverider). He rediscusses the ancient 15/1 gold/oil ratio and outlines today's 11 to 1 ratio discussing if oil is too expensive and/or gold too cheap.

Other ratios are interesting, the Dow/Gold, Dow/Silver, Gold/Silver, Gold/XAU etc.

Ratios are statistical, what do they mean? In the case of the gold/oil ratio Hamilton makes the point that from 1950 to 1971 the ratio averaged some 14.8 and in the last 30 years it has increased to over 16.

So where is it going? Well, reading the numerous 'cheap oil' essays, posts and messages it seems to me that the ratio may swing strongly in oil's favour in the next few decades. As cheap oil becomes scarce will it's price not accelerate faster than gold? Let's guess a little. When the last barrel of oil is sucked out of the ground (in 2099??) suppose the ratio is 1 (gold $10,000/oil $10,000). Alarming, absurb, impossible? In 2006/2008, as we approach Hubbert's Peak, oil may fetch $80/bbl while gold languishes at $400/oz. The ratio, a mathematical convenient 5.

The long term view of 15/16 as the historical gold/oil ratio in my opinion will drop.

Silver is in my books as a love/hate metal; I can't decide to be bullish or bearish. Yes, silver is consumed (little above ground) and more industrial use than gold but silver has indeed lost it's largest use. That use, as we know, is the making of coin/currency. The US had a hoard of 2 billion ounces many, many moons ago and now it has a mere handful. This is alarming at face value but the other side of the coin is why do they need it? Why does the US Treasury and/or the US Mint need a massive stockpile of silver? Do they stockpile zinc, lead, ....apples?

The ageless/endless commodity/monetary argument for silver appears to have reached its conclusion. Silver has slowly shifted over the last 30 years to commodity status. Even the goods folks here and at other forums boast of more and more commodity uses and there is (as one must admit) less and less monetary use of silver.

Some time ago I chanced on a Dow/Silver ratio chart. I forget the exact numbers but I recall numbers of 100 and 200 to 1 generations ago while the ratio hit a mind-numbing 2200 when the Dow peaked at 11,000 and change. Where will this end up?

Back to the gold/oil ratio. Let's assume for the moment that alternatives to oil, NG, coal etc. will not be discovered/invented in the next 20 years. These conventional sources of energy will rise; given the assumption above, this is not a debatable fact. So, if the gold/oil ratio is to increase to its historical 16/1 gold must rise. Why will it rise?

If silver is being de-monetized and the debate rages that the PTB is doing the same where all this lead?

Forget about the ratios, I can concoct a corn/apples ratio that will be as meaningless as any other. The bottom line, IMVHO, is the attack on the monetary value of gold.

As Hamilton pointed out in 1995, the traditional 16/1 gold/ratio was severed. So began the de-monetization of the yellow metal. This is where my focus will be, trying to understand where gold is headed. Will it follow oil? Will the PTB lose control? Will gold be a commodity metal for high-performance printed circuit cards and jewellery?

The WA gave us a crumb but I do not know for sure if it's for real. Yeah, yeah "gold will remain an inportant reserve", blah, blah, blah. The $260/330/260 ramp up/ ramp down didn't convince me of the EU's intentions, seemingly not the market's either.

We know as much today as we did 5 or 6 years ago, nothing.


(Must run, sorry for the non-proofread; I await the flaming!!!)

Internal strife can & will deflect external plans of Hard Line Communist Leaders, IMHO.China's labor
unrest a portent
by Manik Mehta*
Taipei: Taiwan
TNA News with Commentary
No. 330, Weekend 6-7 April 2002

The pressure cooker has been whistling for quite some time, but few international analysts have taken notice of what has been happening in mainland China. The euphoria over what many anticipate will be a larger market has drowned out the cries of laborers, who are afraid of joining the ever-increasing hordes of the jobless.

With Chinese Premier Zhu Rongji's new emphasis on productivity, it is natural to expect millions of workers to be laid off from unproductive, bloated government organizations. Indeed, the mainland's labor problems will intensify further, with inefficient, unproductive units facing closure and workers being phased out of hitherto cozy sinecures. Layoffs will create social unrest. Workers depend on such jobs for basic survival. The socialist thinking of many workers, who still cling to past ideals regarding "overall good," has still not been completely eliminated. Organized labor in state factories is very much a problem � a situation that has come to the fore in recent days.

The mainland's "Rust Belt" was rocked March 21 by escalating unrest in two cities. Workers, angry about unpaid wages and job losses, took to the streets in face-to-face confrontations with military police. The communist leadership is fearful of social unrest in that the majority still lives in poverty while a small minority along the southeastern coast enjoys prosperity.

Eye-witnesses in the northern province of Liaoning told journalists that the military police had to be called in to safeguard the local administration office in the industrial center of Liaoyang, and break up demonstrations. While eye-witnesses said there were 10,000 demonstrators, local officials, in typical fashion, denied that there had been any protests at all.

Another scene occurred in Daqing � an oil town in Heilongjiang Province in the North � where employed and laid-off workers picketed the local office of China National Petroleum Corp. Angry protestors overturned a car, although it was not clear if there were any occupants inside the vehicle or whether anyone was injured. Despite all these incidents, the communist regime in Beijing declared that "nothing had happened" and that everything was "normal." But the "normal" situation continued to deteriorate further. Thousands of angry demonstrators marched to government offices calling for the release of four labor leaders, who had been arrested. Three leaders were arrested while holding talks with government officials in Liaoyang. The fourth was arrested near his house.

Strikes and demonstrations were unusual when workers were guaranteed jobs regardless of whether they were engaged in productive work or not. But as modernization continued and competition became fiercer, particularly after accession to the World Trade Organization, inefficient state-owned firms are being closed and the ranks of the unemployed continue to swell.

While demonstrations have, by and large, remained nonviolent, burgeoning unemployment will produce a great deal of worker frustration. Such frustration can lead to social unrest that may eventually culminate in violent upheavals. Already, the size of the demonstrations and intensity of the protests have taken both local and foreign experts by surprise. Workers believe that they have been cheated by factory managers and by extension the state, which after using them for decades is now throwing them out onto the streets.

The communist regime deployed armed police to quell what have been some of the largest protests in the country, highlighting the pressure the Chinese Communist Party is under from millions of workers who have lost their jobs since reform began. The workers at the Daqing oil company were particularly angered by a plan aimed at abolishing welfare benefits in exchange for a one-off payment unless workers continued to contribute to the pension fund, despite no longer being employed.

Many are already wondering if these protests will one day turn as volatile as those held at Tiananmen Square in 1989. Such an eventuality cannot be ruled out. After having jumped on the WTO bandwagon, the mainland's main priority is to remain competitive in global markets.

According to independent sources, another 20 million job losses are expected nationwide because of WTO membership. Indeed, as the mainland opens its market to imports, it will not only face the onslaught of sophisticated foreign technology but also products of superior quality. As purchasing power grows, a quality-conscious class of people will be more inclined to purchase imports.

The International Confederation of Free Trade Unions stated that workers in Daqing have established an unofficial union and that demonstrations have spread to other oilfields as an expression of solidarity. Activists are reportedly hiding to avoid arrest.

The Daqing unrest is reminiscent of trade union activity in communist Poland in the early 1980s when an unknown shipyard worker named Lech Walesa emerged as a trade union leader. He banded workers together, eventually leading them to liberate the country from the communist yoke. Is the mainland next?

*Manik Mehta is a free-lance writer based in New York.

Just the "Tip of the Iceberg" .......And the Public Investor Rides the Titanic....DEFAULT BY NTL CABLE-TV WOULD MARK
THE BIGGEST CORPORATE BOND DEFAULT IN HISTORY,
even surpassing that of Enron.

A Bloomberg wire on Thursday pointed to the fact
that, according to Moody's Investors Service,
the corporate bond default by Enron last year
amounted to $9.9 billion ***(excluding bank credits and derivatives, of course),***
while the British cable-TV company NTL, based in New York,
is now about to default on $11.5 billion of corporate bonds.

On Monday this week, NTL was not able to meet interest payments
on its bonds. As Bloomberg writes: "It now has time until May 1
to make good on the payment or trigger
the world's biggest corporate debt default,
which would send it into Chapter 11 bankruptcy protection from
creditors."

NTL is the leading cable-TV group in Britain.
Its stock price plunged 43% on Monday alone,
while its market capitalization since the beginning of 2001 melted down from $11 billion to $23 million.

London's Financial Times notes that with total debt
more than 500 times larger than market value,
NTL surely qualifies for the "Guinness Book" of records.

NIPPON TELEPHONE & TELEGRAPH (NTT), JAPAN'S MAJOR PHONE COMPANY,
said today that it expects to post the biggest annual loss
by a Japanese nonfinancial company. NTT said it will record
a loss of 865 billion yen ($6.5 billion) for the fiscal year
ended March 31 of this year. This will result from NTT writing
down
2 trillion yen ($15 billion) in its investments in overseas
companies AT&T Wireless of America, Royal KPN of Netherland's
mobile phone unit, and Verio, Inc. of America,
and including a reorganization charge of NTT's own domestic unit.

Meanwhile, financially troubled Worldcom announced it would
layoff another 3,700 workers, or 4% of its total workforce.
Worldcom is America's second largest long-distance phone company,
and the world's biggest carrier of Internet traffic.

I have come to use about 6 reference points to gauge the health (or lack of) of the U.S. economy. While these aren't anything new it quickly gets me to real information that can't be seasonally adjusted, hedonically deflated, or any other form of skewed reporting. So unless you just like watching Bartiromo blather about why the arrows are all red you can get your cost down to a weekly Barron's , a quick visit to your state web site, and visiting this site to convert those worthless fiats into money.

* IBM / GE stock prices - this is the faith in the market, period. If either did an Enron its all over.

* JPM/ Chase - barometer of derivatives bubble. When trillions go by- by this flag will be bright red.

* Fannie/ Freddie and HD - barometer of housing bubble. This is mostly the only prop under the economy right now. Trillions of government-backed cheap mortgages are doing the trick. For how long?

* Insider selling - Wall Street faith (or lack of) in Wall Street. As they say they are talking the talk, but aren't walking the walk right now.

* State sales tax collections - measures the real economic vitality and not just vague references to recovery. Our state just had a 9% drop in collections for the month of March. It isn't recovering if the sales tax revenue is dropping.

* M-3 non-adjusted - the real inflation rate. When M-3 was about a trillion gold was still about $300. Now M-3 has surpassed 7 trillion and still the same $300 gold. I figure the delayed rate therefore at $300 per trillion, or $2,100 for the real price of today's gold. Whenever I see 50 billion added almost weekly to M-3 I figure gold is up about $16.50 that week. Anything less is suppression. Remember when 1 share of Amazon would buy 2 oz of gold? Now it would barely cover the premium to spot. Think dollar instead of Amazon stock and you get a better idea of the risk. I know there are many excellent guides other than these 6 but I really think it clearly and quickly gives a picture.

Very interesting info... great analysis!

On the topic of Germany, do you have any thoughts regarding their unification? It had always seemed to me, that the 1:1 West/Ost Mark exchange would manifest itself in much worse price inflation. Yet, despite all the economists warnings, it seemed politically pre-determined, and indeed, that is what happened. And, in the same way (on a smaller scale) that the U.S. seemingly mystified its critics when it broke from gold in 71, so this superinflated new German state has had only mild inflationary indigestion, hardly the rupturing ulcer their physicians warned against.

Regarding the U.S. dollar actions of the 70s, a more complex understanding of factors like oil, gold, and the politics regarding a replacement currency, help fill in the gaps. Do you think there are any such considerations to be had in the German situation as well?

While Russian troops left the East ostensibly as a bankrupt, vanquished foe, with little alternative, do you think there was any other price paid for such an easy withdrawal? Seems to me, that despite the blown up state of the Soviet "empire," at that time, this was truly one of their prizes. It seems odd they let it go with so little fuss...

All this to suggest the question, if there were prices paid for an "easy" absorption of East back into West, was payment deferred to sometime in the future? Is payment coming due in this day?

While an official intervention on the part of a German utility (presumably because it needs help), is a typical short-term political goodie, it seems there would be more to it. Is this utility some metamorphosis of an old East German utility? If so, I would gather there are not too few shareowners still, that were former Soviet officials. This being some way of washing a payout promised a decade ago through transparent political channels. Maybe not, but I'm sure this kind of thinking goes on.

If gold is about to undergo an "official" revaluation, there are settlements that need to be made before the fact in cheap gold, just as much as settlements will be made after the fact, in revalued gold. Depending on who had strength in the bargaining position at the time...

Gotta run right now... will check in later. Would love to hear your take, though...


cheers,
miner

http://www.plata.com.mx/plata/plata/comHSP27a.htmBy Hugo Salinas Price- "The right way to use silver in coinage." Written last fall and more relevant today than ever. This excerpt from the link concerns full legal tender status for silver!!!: "...Russians have plans similar to one we have..." Also he wrote in February 2002, this gem: "Mexicans buy more gold"-http://www.plata.com.mx/plata/plata/comNOT24a.htm

Site links other articles in English or Spanish

I found them very intriguing and most likly correct.

I doubt that any Gold was/is/will be used for eventual Ost/West settlements !? Think you are running a bit too far with the Welteke Gold incitement. But indeed, Gold stands at the end of unemployment > contraction > stagfla > currency depreciation + welfare (re-distribution) etc. Basically confetti expansion in economic contraction, should be accompagnied with Gold (POG) value adjustments.
But that's what the ECB is doing (shy though) with its quarterly marking to market of Gold !!! Germany's reunification + expansion to Balkan and Russia is expansion. But is it a passive (redistribution) or a healthy productive expansion !? And here comes that desire of a specific monetary policy of the unified Germany, within the rest of Euroland. Yes Germany wants and has the capability of growing faster and deeper than the rest of us. And all this when they lost their total autonomy on monetary policy.
So far the euro and EMU has protected Euroland from heavier inflationarry burdens. But how difficult is speed of growth (different speeds of growth) and stability compatible in an Euroland with different economic velocities. This creates tensions and is reason for political fights (Welteke) on different programs. Euroland the Big "Compromis" ! Uhhgg.

Internal EMU tensions work on this quarterly valuation of the ECB gold reserves and on top of that the remaining goldreserves of the respective 12 member National Central Banks. Imagine you having to manage a household with 12 spouses (smile with understanding) ? And these 12 spouses have different spending patterns, but tied up to the Miner Agreement (WA) for periods of 5 years ...do you follow me ?
Add to the problem that it is not only your 12 spouses (EMU) but also other big spenders (U/UK/Japan/etc)having signed the WA and not belonging to your household. Woehaaa !

The final intention of FREE GOLD is having a constant Valuation of the Physical trade as a reflection of monetary management ! Bad management with strong currency depreciation = Higher POG or inversely.
This is surely not yet reflected in the present quarterly price marking of POG by the ECB !!! POG in euro is escorting the dollar/euro or euro/dollar trap ! Note that the US Gold is only reclassified and not marked to market since 30 years. And w've not yet come to any explanation for that reclassification and the possible role of Germany
into this. I'm at a complete loss here ! But don't give up searching.
Kind Regards to you Miner49er.

The POGWhat was the official POG? $299.80 or $301.00. There are two people who have something riding on the price. First my reputation and second the guy who is going to dye his hair blonde if gold stayed above $300.00 for Five consecative days. Betcha he was in my corner.
As for this experiment in calling the POG there are two ways to look at it.
Perception. That is what Joe Sixpack uses to evaluate the market. For him all is fairly well so his investment sharpness has been dulled. Why else would he continue to put large amount of money into the stock market and not invest in PM's.
Now sizing up the market that is a different animal altogether. The amount of information is far greater and researched for truth.

Perception and Sizing Up are almost the same except and I use this example.


When you meet somebody new and he is big. You think this guy is a nice guy. Thats perception.

Then this guy gets angry with you. And you think, can I take this guy or should I leave. That's Sizing Up. You might precieve that if you hang around you might get a whoopin.

So, Do you want to know when Gold goes to $1000.00 an oz.?


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

** When central bankers become asset managers **

Gold and the previous (non US) US$ as good as Gold have always been the assets to be managed by CBs under direct order of the oligarchic governments, no ? What difference does it make if "stocks" are directly (Welteke+FED) or indirectly (Interest Rates) managed as asset or asset derivative ? Goldreserves and consequently the respective floating currency's valuations have been managed by CBs for already more than 70 years. We just are allowed to see some more transparancy on how this gigantic interventionism is to evolve. It is nothing more than explaining what is ment by the financial tail, wagging the economic dog ! What is the essential difference in se between the PPT and central bank ?

The European Central Bank (ECB) is making the difference or at least WANTS to make the difference with the management of one particular and very special asset : GOLD !!!
Who cares if between the assets (Gold/currencies) there will be some stocks or apples ? Wich of the present or future assets will remain as for all seasons to come ? All together now : GOOOOOOOLD ! Repeat : Phyyyyysical GOLD !
Stocks are paper contracts, stating virtual ownership of the underlying enterprise. So are Bonds, notes and any other paper contract, derivative or not.
I could appreciate if tomorrow CBs start stockpiling Crude Oil ! Than we talk about an asset worthy to manage.
But it is exactly these two VERY REAL assets (Gold + Oil) that are subject of denigration ! Both can NOT and will NEVER reach zero value ! Japanese IRs rerached 0,01 % level and track the purchasing power of so many currencies as notes or bonds. Real estate and land values are constantly taxed away. Why do the Rotshields have such a treasure on high value antics (and Gold of course) ? No taxes and transferable to the next generations ! Let them (CBs) play and manage as much different paper as they wish. I'll keep my yellow coins under the matrass.

These high profile but minuscule Goldsales by CBs is a lot of sand in people's eyes. I even start to enjoy official announcements (threaths) of some more Goldsales/exchanges/reschufflings (no sarcasm intended)!

http://educate-yourself.org/brotherhoodpart3.htmlInteresting reading.........(NWO stuff)

Bundesbank, Old Bankers' Trust and DeutschbankI would like to throw a thought into the mix.

In the early 1990s Bankers' Trust made a decision to go from being primarily a commercial bank involved in the kind of business your neighborhood commercial banks does to a global money-center bank replete with wholesale currency dealings, loan repackaging, investment banking, i.e., the works. In the late 1990s stories began to surface that Bankers Trust was having all sorts of internal problems -- much having to do with complex derivatives arrangements. If I recall correctly, Proctor & Gamble at one point filed a suit against Bankers' Trust for fraudulent representation with respect to derivatives' packaging sold P&G. For awhile the details of the suit were suppressed by the courts and I don't know if they ever became public. I lost track of the story after Bankers Trust mergerd with Deutschbank (in 1999 I believe). The fact of the matter is that Bankers' Trust had the reputation on Wall Street of being one of the big risk players in derivatives. This modus operandi usually includes gold loans. I am not certain that Bankers' Trust was inolved in the gold carry trade business but I would not be surprised if we learned that they were deeply involved.

What is interesting about the Bankers' Trust/Deutschbank merger (beyond the on-going strategy of merging an entity that has gotten itself in a trading hole with a stronger, more conservative entity -the Barrick/Homestake merger also fills this mold) is how risk can be transferred across national borders. What was once the lender of last resort problem in the United States is now the lender of last resort problem of Bundesbank. (It would be interesting if someone could find out how this would affect ECB as well should Bundesbank decide to bump the problem downline). And I don't think any of us should lose sight of the fact that the lender of last resort function remains a central bank's most fundamental responsibility. As James Turk most notably documented several years ago, a central bank can print paper money to bail out a failing commercial "debtor" but it cannot print gold to bail out a commercial [gold] "debtor."

Can it be that the responsibility for the Banker's Trust gold loans transferred to Bundesbank via Deutschbank and the merger? My guess is they have and as a result altered the long term German financial establishment's alliance with gold. Deutschbank inherited a problem it didn't really want (or understood it was taking on) and in the process affected German monetary policy. The Welteke gold gaffes follow on that. It seems to me that some gold depositor[s] need[s] reassurances and that's what these statements are all about. Who that depositor might is anyone's guess. If Bundesbank can get in line for WA2, that reassurance carries weight beyond anything simply verbal. Gold lenders understand the supply problems with gold -- if they don't, they should.

There simply is not a lot of gold around in size. Bundesbank cannot make a few discreet phone calls and find 500 tonnes. It's not going to happen. Everyone in the upper echelons of the gold business knows this and I will stick with my original analysis that the British, the Swiss and the German sales (if there are any) are essentially lender of last resort activities resulting from the on-going and structural shortage of hard metal. Germany cannot afford to let Deutschbank go down (as Doody references in the generalized sense). So it may sell unless the German people through one of its political parties stops it. The depositor will be forced to remain patient and hopeful. Welteke's there to provide comfort.

In the future, I think the eurozone will look long and hard at mergers with external banks, particularly British and American banks, to make sure that the lender of last resort responsibilities on gold loans is not dumped on their doorstep.

Hard to believe that Deutschbank made such a costly mistake, but they did. And, once again, its interesting that a simple merger would have such a ponderous effect on German gold policy. One wonders if there hasn't been some behind the scenes quid pro quo involving gold between the U.S. and Germany -- but in my mind the flow would be opposite of what has been contended: From the United States to Germany instead of the opposite.

This is all theory, my friends --an educated guess as to what might be happening behind the scenes. I'll leave you and future events to determine whether or not this scenario holds water.

Since you've proven yourself to be quite adept at, shall I say, cutting through the underbrush, I was hoping you might be able to provide your particular brand of insights on this following matter.

You recently commented nicely on the motivations behind BuBa President Welteke's recent comments, and as you know, ECB President Duisenberg offered his own response regarding expectations of (fiscally- socially- economically-(?)) responsible activity from the BuBank with respect to gold. I can grasp that well enough.

My question for you is whether you have any inkling (translation = hunch, notion) of what Mr. Duisenberg may have been driving at when, beyond the jurisdictional element, he answered the equities question with a wink?

As a refresher, here again is his delivery Thursday regarding both the official practicality and official "endorsement" let's call it of Mr. Welteke's suggestion that the BuBank might purchase equities:

-----"Well, the management of both the foreign reserves and the domestic assets of any national central bank falls, beyond certain thresholds, under the guidelines and guidance of the ECB. That is one thing. And to buy equities is, let me put it this way, for many central banks not unusual."----

Your thoughts on the list he likely had in mind?

Thanks for your time.

R.

It seems that while I was typing my previous question, you were busy giving the lion's share of the answer I was ultimately expecting. Well done! That is, unless you have more you'd like to offer on the matter...

R.

"History can only be made in the context of preceeding events." - This you said in relation to my "Thoughts for the weekend."

I am puzzled by the connection between your clear, declarative statement, and the things I had to say; which I offered as thoughts, as suggestions to mull over.

"History can only be made in the context of preceeding events": yes, I suppose I can agree. But - there are lots of "buts" - WHAT are we to consider as the pertinent "preceeding events"? How do we select them? What rule do we apply to select the preceeding events? This is the problem of writing history: how to select the meaningful events. No two historians, however well-qualified, will ever write the same "History". Enough books to fill a library have been written on this subject. Herodotus, the Father of History, was hated by others as biased and malignant - Plutarch and Thucydides for example.
So if we want to stick to the "facts" - just what are the "facts"? Some historians even today are punished.

Black Blade writes about the End of Hydrocarbon Man; but, we have a preceeding event that is hardly known at the moment, which may change the outlook drastically: the Longitudinal Waves of the Vacuum which it appears MAY allow the construction of generators of energy in limitless quantities, such generators possibly to be on the market initially, by next year. See cheniere.org.

Incidentally, I can't think of an event more dangerous and destabilizing for humanity, that to provide it with unlimited and virtually cost-free energy! Disregard for limits, in any field, always brings with it Nemesis, the punishment of Nature, or of God. This invention may be the death of humanity.

Hoople: thanks for your six guidelines. I agree with you heartily. We don't have to know too much. Just the most significant data suffice (Again, what is "significant"?) Well, we can pick and choose as we like. I like your selection. 99.44% of the content of the WStJ is insignificant, as far the big picture is concerned. "So pure it floats!" Pure fluff.

M3: M3 is a good indicator. Very strictly speaking, prices in general are not - in Austrian economics - mechanically determined by money supply. But as a practical rule, I feel that prices DO follow the path of M3 over the long run. (Here we have Historical insight working together with Economic insight which is of another nature entirely.) I like your parallel between an M3 of 1 trillion, gold at $300, and M3 at 8 trillion, gold at $300. An objective of $2,400/oz is entirely reasonable, in my view.

Thanks for reading!

Sierra

The deeper you go into this analysis, the more you realize that physical gold remains the Holy Grail of the gold business -- the objective of all operations and precisely the opposite of what the opposition would have the public believe. Those who buy time, buy time to acquire the metal. That's why all paper representations are threatened on a continuum of risk for the holder the further you move away from the metal itself.

FOA and Another were right.

Very nice to see it in print. A real treat for our Saturday visitors, to be sure.

R.

http://www.2000wave.com/home1/home1.html
The elephant at the cocktail party is finally getting some serious notice.European M&A activity has slowed to a crawl(little wonder in light of massive "good-will" writedowns as a conesquence of buying into bubble valuations)and the Asian tigers are carrying the ball now.

Perhaps bomb ia better word.

Short sighted monetary officials and brain dead politicians;supposedly acting in their peoples' best interest.Best argument yet for buying physical gold and saying NO to destruction of years of hard work and diligent saving in an inevitably valueless currency.

Can't happen in America,those who should know better endlessly bleat.

Another fine mess,the search is ongoing for villians to blame.Hopefully,the diversionary tactics will not work this time.

Pondering your thoughts as always; and, merely stating a truism though perhaps indirectly connecting your dots.

Best2U....CM

"""In the same way as prices rise against a currency durring inflation, physical gold prices begin to rise against paper gold. Less gold will delivered against contracts untill we end up with totall cash settlement. All the while the physical "Free Gold" market trades at higher and higher currency price. This is what dollar hyper inflation may look like in our modern paper gold markets. AS LONG AS INVESTORS BELIEVE IN PAPER GOLD, THEIR WEALTH WILL BE SLOWLY ABSORBED BY PHYSICAL GOLD BUYERS UNTILL TRADING BREAKS DOWN.""" By our Trail Guide.

I can feel the stomach of paper gold traders feel like they have just swallowed a bucket of ice water when they read that. That was written some time ago as well. Talk about a valuable lesson to learn before it is too late. I would be happy to buy physical gold at double the paper cost, even more. FOAs message has not fallen on deaf ears around these parts!!

http://www.goldensextant.com/commentary12.html#anchor29020
Derivative activities from May 2000.Wenteke is squirming in a open and brazen fashion,however,at the moment,central bankers are still above suspicion in the financial skullduggery that envelopes our planet.

It's up to the people in the steet to expose these criminals(I do not use this word lightly),as it is obvious we are only recieving cursory coverage in the mainstream media despite GATA's assertions to the contrary.

Look at how quickly Enron disappeared into the ether when it became clear how these people in postions of power and trust so insidiously work together.

http://www.hindustantimes.com/nonfram/070402/dFOR09.aspNoninterventionism- Embracing this tenet, our founding fathers weren't only concerned with preserving lives, but the quality of life, and for each succeeding generation. The linked story originates from Moscow.

Just dropped in and skimmed the interesting posts re DB/BT and the potential blunder of landing BT's derivative - possible gold shorts at DB and eventually BuBa's door step.
Makes sense.

And probably makes even more sense by pondering DB's failed trial balloon to take over JPM, which would have re-delivered the gold problem back to the original sender.

Anyway, DB has bought the proverbial cat in the sack with BT and was squarely taking it on the chin, while part of a US/UK problem was neatly exported into the (pro gold?) euro lands.

Again, pure speculation on my part only, though the absolute
silence on euro CB's on any gold issue (remember my repeated queries to Klaus Liebscher the Austrian CB Gov. and a l.t. friend, to no effect) - except Wetelke's pathetic ramblings - would prove that something is very amiss in regard to gold.

... A final thought on the lender of last resort, which after the demise of Bretton Woods should have been the IMF
SDR's. We know seem to grasp that SDR's had a foster child called SDR Certificates, regulating gold equivalents as final barter payments for products necessary to keep up the grand illusion of inherent value in the free floating confetti currencies.

This system is doomed and the potential outcome can be read at the latest Atzteca di Oro at the Cafe - hopefully not the Dark Ages again.

- late night ramblings - cb2

http://www.smithers.co.uk/esnews.shtml?209
It's stock options and cooking the books by unscruplous CEOs,thatwould be today's bad guys,according to the esteemed Mr.Greenspan.

Who is responsible for allowing these charades to be created and continue in an unabated fashion,while the ROW withered away'sir?

Why were they heroes two years ago and villians today?

Where are the profits generated in your productivity boom?

Note the comments of the FASB spokesman,possibly hundreds of billions of off-balance sheet debt that must,at some time,be reconciled on companies' books.

Just another unexpected surprise,that's all.

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020406/ap_on_re_mi_ea/mideast_palestinians_120Arab Foreign Ministers Meet

Snippit:

CAIRO, Egypt - Arab foreign ministers gathered here Saturday to discuss ways of increasing their response to Israel's military offensive on the West Bank amid calls from Iraq and Iran to use oil as a weapon. The Arab League ministerial meeting comes after a week of daily protests against Israel and the United States, the like of which the Arab world has rarely seen. Jordanian demonstrators beat up riot police and sent them packing in Amman on Saturday while Bahraini protesters set fire to structures in the U.S. Embassy in Manama.

Iranian supreme leader Ayatollah Ali Khamenei came out Friday in support of the Iraqi oil proposal. "I suggest, only for one month, as a symbolic gesture, that Arab and Islamic countries switch off oil to all countries who have close relations with Israel," Khamenei said in a Friday prayers sermon in Tehran. However, support for a cutback came from a newspaper in a fifth oil producer, the United Arab Emirates, on Saturday.

"The time has come to stop talking and start action ... Time now to reflect upon the success of the oil embargo of 1973 ... So it is time to use it again. Then, perhaps, the international community will once again listen to the voices of the Arab peoples," said an editorial in the English-language Gulf News.


Black Blade: Support for a new Arab Oil Embargo is picking up steam. Libya could also be expected to give support. There also exists the very real possibility of terrorist acts against the oil industry infrastructure of those producers who do not support an embargo. This Middle East affair is intensifying and spreading throughout the region.

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020406/ap_on_re_la_am_ca/venezuela_oil_protest_42
Snippit:

An escalating confrontation between the government and workers at one of the world's largest oil companies has started to affect exports from Venezuela � the largest foreign supplier of oil to the United States.

Protesting workers closed two of Venezuela's five major loading terminals Friday, stranding a dozen ships waiting to load cargo, Venezuelan oil officials told Dow Jones Newswires.


Black Blade: Oil workers have called a strike for Tuesday. Another possible restriction of oil supply is in the works.

http://www.hindustantimes.com/nonfram/070402/dLFOR09.aspPlease accept my apologies for oversight. Article suggests resistance reminiscent of VietCong. If the US public overwhelmingly approves of this conflict as we are told, why aren't our dead and wounded casualties being honored publicly?

Just a couple of weeks before the famous "Washington Agreement" I had a converation with the Managing Director of a venerable PRIVATE Swiss Bank.

I was dumbfounded by the ignorance of this individual in such an important position. Let me tell you, he did not have a clue!

Gold has been expunged from the mind of this man, and I suppose if he is so ignorant, the rest of his colleagues must be in a similar situation. For him gold is through, finished, Kaput, a thing of the past. He said, "The Central Banks don't really WANT any gold any more." Just those words.

The Swiss have many virtues, and I hope they keep them. But what is one to think when coming up with such a character?
I remember Orson Welles' line in "The Third Man": "What have the Swiss contributed to civilization? - The cuckoo clock."

Load up with gold, it's like taking candy from children at this point. It won't be so much longer. See my next post.

Sierra

For what it is worth, here is a message received today, from a prominent New Yorker:



King of Jordan has warned Bush he fears for his
life and could be assassinated at any time. President
Mubarek of Egypt believes he could be overthrown imminently and has so warned Bush. The Arabian street is in turmoil.
The situation is extremely fluid.

The CIA thought they had the Middle East under control
and I was assured that there was nothing to worry
about as little as two weeks ago. Now, they are
clearly alarmed.

DEBKA weekly says that 15 dinghies have been
discovered along Israel's shore carrying an
estimated 150 highly trained commandos possibly carrying
weapons of mass destruction and assessed to be working in
teams of three, or fifty teams. The security
breach is almost incomprehensible as this is the most
secure shoreline in the world with the Israelis and American fleets offshore and DEBKA believes that security
codes and technology has been compromised as in the 9-11
attack. In other words, there appears to be inside
help. Someone clearly wants the world turned
upside down.

This whole area could explode into a catastrophe.

Such a catastrophe would clearly wipe out any thought of Central Bank control of anything, and it is
questionable that this amateur hour over at the
Federal Reserve is capable of handling anything of
this magnitude.

DEBKA says that targets such as London and various
ones in the United States are on the highest alerts
and may be struck. This is the DEBKA weekly.

The situation is clearly different from that of
1973 and ten times more dangerous. It is even worse
than the Lebanon-Beirut invasion.

It is important to note again and again that the
international financial situation has never been at greater risk with over 60 trillion of counterparty risk in derivatives, and the international current account
imbalances almost unprecedented in magnitude and
proportion. The current account deficit of the United States alone is approaching 500 billion a
year, or 5% of the Gross Domestic Product, and the
net deficit position is approaching 3 trillion dollar or 30% of the GDP. There was nothing like
this in 1973 when the United States reigned supreme
as the world's greatest creditor and was able to successfully absorb the oil shock at extreme cost.
We had better men to handle it then.

It is questionable whether the international
financial system is resilient enough to handle an oil cutoff of the magnitude of 15 million barrels a day
of 76 million barrels produced to underpin the
world economy, and a collapse of that system would lead to the overthrow of the liberal regimes in the United States, England, Western Europe, Japan, etc. as in Germany in 1929 to 1933 that collapsed over similar current account imbalances. The political ramifications and consequences would be similar.

The Bush crowd, like that Gadarene herd of old, is
rushing like the possessed to a ruin that is almost without precedent since the old Christian monarchies were overthrown by the atheistical forces of international finance that have almost completely corrupted the western world in order to effectuate its submission. Benjamin Disraeli's novel, "Coningsby," tells the true story of the history of our time, and who was behind this.

.......

A worrisome message, indeed.

Sierra

DB has most probably found the needed physical in the South African underground ? Crash the rand and it (the Gold) can be mined (faster). Combine a certain goldmine with the web of holocaust restitutions...? Add DB's introduction of derivatives (warrants) on SA mines (Gold Fields).
To be continued...

As I recall, at the tim of the BT defection over the pond, BT was a Federal Reserve Bank able to legally trade in gold certificates drawn on US Teasury gold in accordance with the the Federal Reserve Act. I expect they escaped holding a sizable quantity of these notes and that the US Treasury, not DB or the bundesbank is the party that is liable for delivery. This may be the origin of the 'custodial' gold designations. I also recall that those officers defecting to germany with BT drew very large compensations for their role in the coup (or their silence?). One has to beleive some serious monkey business went down here but then Rubin was still Sec of Treasury.

If you search the archives following the announcement of the merger, you may find I commented upon it then but not really knowing of what significance it was...(perhaps none)....just musings.

There is an individual in this forum who has made it his priority to pretend he doesn't see what I have posted. He does this by reason of untrust. One thing I would like to convey is that I respect this individual's opinion very much, and that there was never an intentional attempt on my behalf to belittle this individual's opinion. Study previous posts, and you will see that I was the first to jump to this person's defense when a non-substianted post was delivered. The negative post has been deleted, however, the individual I defended's post remains. Do not forget, how feeble my opinion may seem, that I am capable of recognizing the fact that there are individuals in this forum who are very capable of presenting ligitimate ideas and arguments relevant to current discussions.
I participate in this forum because I seek knowledge that I do not posess, and opinions that I haven't considered. How big or how small a person may be, or how many similarities I might share with any individual will not deter me from speaking my opinion. Perhaps I might be banned by lack of interpretation of my intended message, but I would like to have you know that I do not participate in this forum for reasons of slander.
I would like to consider myself to be of above average intelligence as some have indicated to me through results of various tests of modern day science, however, as any truly intelligent person will tell you, I know nothing relatively speaking.
I am a physically/mentally active person, and this forum provides me with a link to others who are similar to myself, and in most cases much more informed.
As I have already stated, I am greatful for your response to my 'futile' quest, and you have managed to gain my respect as a logical straight-forward type individual.
I will look forward to exchanging ideas with you in the future.

Thank-you,

RobotGuy.

Is the Elliott Wave theory applicable to precious metals ?

In making my morning visit to this esteemed Hall, I saw your question and can provide something of a response. I am not an expert on Elliot Wave Theory, but I've always been intrigued with it because I too believe it reflects a rythmic pattern not just within the markets but applicable to other aspects of life on this planet -- including human history.

Can EWT be applied to gold?

It can and is -- with varying degrees of success. The entire plausibility of the theory in any given situation can be reduced to where the analyst puts the number "1" on the chart -- all else follows from there. The weakness in the theory is that it cannot readily predict at any given moment whether we have reached a top (or bottom) in an given numerical sequence, therefore the endless debate among proponents of the theory (and the introduction of mathematician Fibonacci to cover the price predicting "hole" in the theory).

For example, Robert Prechter, who I consider to be a brilliant economic and social analyst, has one count on the gold market which projects a bearish thesis. His mentor, British analysts AJ Frost, has a different count which projects us at the start of a long term bull market in gold which could stretch for many, many years. We (GC and I) were curious about Mr. Frost's EWT count some years ago and GC got his address from Mr. Prechter. Unfortunately, we came to find out the Mr. Frost was very ill, but still willing to forward his count. At the time he believed we were in a bottoming phase (long term) and about to go into a new (upward) cycle. We published it in News & Views some years ago and we could probably dig that up if we had to. Prechter sees the bottoming phase still in progress with a major spike down required to culminate the move. He then sees a springboard effect upward over a short period of time vaulting gold into the initial stages of a new bull market. As such, he recommends investors begin acquisition of physical now because the upside is so large and he projects a sharp "V" configuration to the downside.

My own view, and I am far from an expert on the subject, is closer to Frost's than Prechter's. I see the break from mid-1999 to be the initial stages of new, long term 1-2-3-4-5 (abc) with these first rumblings descriptive of the "1" Wave -- what Prechter calls the True-Believer phase. Both the chart and my personal experience confirm this. Being in the gold business for all these years, one thing I can do is identify the type of people buying gold and characterize them (to some degree). Today's buyers are the "True Believers" -- typical of the "1" wave. The trend buyers aren't in the market yet -- except on a limited basis -- and they characterize the "3" Wave -- or the steady, long term uptrend. The "5" wave buyers are herd instinct, madness of crowd types that come into the market at the end and provide sustenance to all the "1"s and "3"s. You don't want to be "5"; always better to be a "3"; even better to be a "1".

By the way, I hear from the good Professor von Braun that Rob't Prechter has just published a brilliant new essay which I hope to read sometime next week. I see the weakness in the RP analysis as not giving enough weight to the importance of the Washington Agreement and subsequent break over the $300 level -- which amounted to the first manifestations of the "1" Wave. As I say, I could be wrong, but that's the way I see it.

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.

http://www.financialsense.com/stormwatch/geo/pastanalysis/2002/0326.htmThe other day someone questioned the reality of Red Mercury in Nukes, I believe. As I cannot remember who asked I'll just post this link....Again sorry for interupting the financial discussion ongoing (as it should be).....YGM

BTW>>I myself am not necessarily convinced of the veracity of this article, but do want answers to many questions, so I continue to read and question endlessly.....Posted links are the key to ongoing knowledge and understanding.....
Got any to share :o)

...flows from the reality of market manipulations.

As in the JPM/Hamanaka/Copper fraud [Case just closed this week], the commodity prices were [for copper] and are [for gold] under the sole control of the manipulator.

It really IS that simple...and also that complex when the supply of physical metal to sell runs dry.

One can examine all the wave theory in the universe and still end up with that reality. The London Gold Pool and many other examples abound.

The US [Or any other central government] does not view gold as wealth, they view un-backed paper as wealth therefore they cannot be lumped in with other gold market participants in a theory of action. This heterogeneous mix of players with different goals makes the Ellioit Wave Theories useless for today's gold market.

The more useful analysis tends toward viewing the government's actions in the context of a pending exhaustion of metal to sell.

The consequences of this exhaustion is a 10X devaluation as in 1971. So as we edge closer to the denouement, government actions should become more frenetic [As in the Jan FOMC statements about "...buying gold mines...any asset"], extreme [As in the long bond assassination] and predictable [as in Paul O�Neill's "�what recession? Comment].

DB is the largest bank in the world by assets but trading barely over bookvalue. (EMU/US banks = 2,3/3,7 times bookvalue). This makes DB somewhat special not in the least that it is a possible take over target (?).
DB = Germany Incorporated as a very large Shareholder of German quoted stocks (Holding).

If (!) DB is in the need of Physical Gold to protect/consolidate its "unknown" derivative position...it (DB) will search for Physical Gold and find it ! Be it in some more minehedging on top of the 3.000 tonnes existing...or private Gold holders... or the Bundesbank 3.500 tonnes of reserves !
We don't have the slightiest clue on the *nature* and lifetime (volume-?) of the derivatives. Therefore we can't project/guess the amount of Physical needed and for how long and at what POG-level. All speculations are are indeed theory.

ECB Gold and EMU-members National Gold are different in nature and this must still have some space for discussion.
Is all this Physical Reserve Gold equal to euro-currency Gold-reserve ? How much of these total Gold Reserves can be used (consumed) for National emergencies or applications ?

Bottomline : The more Physical reserve that leaves the vaults...the higher POG/Valuation shall be / must be , once EMU will use Gold-Reserves for dollar-loss COMPENSATION !

At present the Japanese are the only savers in need and possibility (!) to accumulate (unexpectedly) more Physical than the gold-derivative architects (hum) ever could have expected. Kind of imponderabile that causes accidents.

So far no other holders of dollar/euro confetti felt the urge to start buying/accumulating abnormal/disturbing volumes of Physical Gold. And as long as POG doesn't give a signal (EW II), all is fine in LALA-Land(s).
No POG rise, no US$ decline...no US$ decline, no POG rise !

No default possible for DB or any Japanse or other banks !
The perfect managed world !? Only an infinitesimal minority has enough perception of the coming storm(s) to justify buying Gold coins at 300$ and holding them for revaluation at 3.000$ or 30.000$ !

If Welteke and or DB don't find the necessary Physical in this falsified goldmarket anymore...they will find another way of making the whole circus keeping afloat ! Selective and contained defaults and genial inventivity in all kinds of constructions is on its highs in this sub-culture.
Creative wizards can make derivatives appear and disappear on books and places.

Once this culture (?) hits the iceberg...the spotlights flash full power on the yellow and make it shine brightly.
Indiscriminately of how much tonnes of Physical remain in wich vault. Did we ever had full exposure or any kind of transparancy on the London Gold Pool affair ? No !
Today, Gold's transparancy is as dark as the new war-reporting. No pictures or pr�-fabricated (misleading) pictures and comments !

The only way of prooving your belief in Gold's future is by accumulating coin after coin. Give this 21 th century Gold Pool a hard time by Exchanging your honest deserved confetti for the most precious tangible ever. Participate in the paper-sub-culture at your peril. And don't count on other Japanese to exchange savings for Gold. The Argentinians had put their faith into the US$ and Honest Banks ! They didn't had the chance to scramble for Gold.
How many other people have that same faith and will be excluded from the life saving boat ? Talker Welteke and other more silent central bankers, know the value of Gold as a monetary reserve and realize very well that we will never know how much of it we will need, shortly !
Paper punters (banks) will be saved....with more of that same paper they produced and at worst with an absolute minimum of monetary reserve Gold. Plunder uncertain underground gold fist !

From Cafe

Gold was fixed in the AM in London at $300.80, followed by a PM Fix of $301. Demand was strong as evidenced by a quick pop in the price during the early New York trading session. Right after the pairing up of buyers and sellers at the PM Fix was finished, gold was trashed by Goldman Sachs, followed by a pelting from fired-up "Hannibal Cannibal" Morgan Stanley.

Funds were early buyers, except for one big fund that was selling above $300, basis April. Goldman and Morgan Stanley got shorter and shorter along with the locals as the Comex trading day went on. They tried to get the fund seller to blow out below $300, basis April, to precipitate stops. But their effort failed, as he would not sell down. Meanwhile, strong physical buying showed up on the gold price break from dealers. Near the close it became apparent that the orchestrated Gold Cartel ploy to bash the market would fail, so the pressing shorts covered, which caused the late run-up.

For the second day in a row, gold closed $2 off its lows. I cannot recall that happening before and gives credence to the notion that the cabal is having great difficulty in their efforts to bury gold again.

(Note to Trapper....I am staying with Schwab because their is no proof whether the shorting was for their account or clients...though as I mentioned,,,it is important that we all be sure that brokers cannot use our shares for shorting...you can call your broker to verify about your shares...and if they use for shorting,,,get it changed.

I will continue to post those banks/brokers etc that are actively working each day to take down gold...and would hope that any readers will consider moving their accounts or writing )

One other "interesting" tidbit:

Reuters Securities
Deutsche Bank hires Rubin as energy credit analyst

NEW YORK, April 5 (Reuters) - Deutsche Bank Securities Inc., a unit of Deutsche Bank AG (DBKGn.DE), said on Friday it has hired Robert Rubin from Goldman Sachs & Co. (GS - news) as a senior investment-grade credit analyst covering the electric utility and energy sectors. Rubin had been responsible at Goldman Sachs for credit research in the utility, power and natural gas sectors, Deutsche Bank said. Previously, he was a credit analyst at Bear Stearns & Co., it said. Rubin will report to Marion Boucher-Soper, Deutsche Bank's head of U.S. investment-grade credit research.

I want to thank you both for having taken the time and made the effort to give me an answer.

Usagold: I obviously don't need Elliott Waves to know that I have to continue buying gold :-) but I find the subject fascinating and intellectually stimulating indeed ...although the gold trail is even more challenging for the newbie.

Sector: I understand. I wondered about the same question concerning the stock market and the impact of automatic trades generation by computers (Pension Funds and Mutual Funds particularly): they probably don't reflect the average investor's psychology either, so I don't know how they fit in the Elliott Waves system.

I believe it was in this forum that I read something about Kondratieff's cycles and waves. Any relationship with the Elliott waves, and any interest as far as gold is concerned?

I do not consider it off topic....but very pertinent.

Though I do not know much on the subject,,,I'd rather have info to check out ....both what may be happening and possible preparation

There is much going on that we are not hearing about...it bothers me that more info is often found in non-USA news while our mainstream media keeping mum and non questioning

Apparently the rule of the day is to keep the people in the dark and happy...doesn't sound like a republic to me!

Actually Debka had predicted that the King of Jordan and the President of Egypt would not attend the Arab Conference long before it was announced that they would not go ....Debka's reason was that credible details of assassinations had been picked up and taken quite seriously.

ONLY "ONE" ALL ENCLOSING WORD AT THE EPICENTER OF FUTURE ACTIONS AND POLICIES < LOUD AND CLEAR >:

******** OIL ******

For the rest I don't dare to express my opinion on the decodations of the speech !

Just checking in.

Interesting middle east events underway.

The diminishing of the Israeli/Palestinian crisis through Bush/Blair politicizing is going to have a direct affect on POG.

First POG will retreat as those tensions ease. We'll probably see that this week. Perhaps even testing the low 290's.

This crisis 'easing', real or perceived, will signal the Bush administration to act quickly on another front. That being to renew the war on terrorism inside of Iraq....

after which POG will easily break the 307, and then 330 cielings.

FWIW.

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20020407/ap_on_re_mi_ea/blair_5------Many foreign leaders, including U.S. allies, worry about Bush's intentions. Chinese President Jiang Zemin, in remarks published Sunday, urged the United States to refrain from military action against Iraq. "International disputes cannot be solved by force," Jiang said.---------
---

The fate of the dollar -- perhaps moreso than any other single national currency -- rests in the global hands of "the market", and China is among those whose decisions to hold or to sell could "influence" the matter in no small way. A point of leverage for solving disputes without force, I'd say.

R.

I think one of the tests as to whether Sadam has those terrible weapons will be the outcome of the British talks...I find it hard to believe that if the USA has convincing proof of these new bombs in Iraqi Hands or placed in the US and elsewhere in the world that Blair would not support FAST removal...and that other European nations wouldn't support ...even if reluctantly

I used to enjoy visiting this site when it was still a gold forum!

If you go back a ways in the archives and the Hall of Fame, you'll find that this has always been a gold forum with oil overtones. Read Aristotle's series on Gold and Oil, or some of Another's old posts. For a long time, though, oil and the Middle East weren't in the news as they are today.

Mental note to self, do not attempt to participate in an intellectual forum while heavily influenced by barley/malt nectars.
If there were an option to delete one's own post, I would have wisely exercised this option in a moment.
If I could figure out exactly what I was trying to say, I would translate it for you.

Please pay no attention to my previous post.

:)

Hey...after doing some of the catch up reading and research on the net today...I think I need some of the barley!!!

Glad I've got gold too!!

I stand corrected. I was just basing my thoughts on the title that proceeds the latest messages, "WELCOME TO TODAY"S GOLD DISCUSSION!" My apologies.

http://www.arabia.com/afp/news/mideast/article/english/0,10846,177039,00.htmlOne can only wonder what the next week holds....
BTW...world events to my mind "ARE" the singlemost important factor affecting Gold/PM prices. Therefore it stands to reason talk of same is not detracting from Gold but adding to insight and reasons for owning same. One big difference between here and over-there is lack of censorship. Civility and in the case of off topic comments, then brevity is or should be respected..IMHO

"GO GATA & GO PHYSICAL"

make that precedes.

Ah, The Nectar of the Gods.Hang in there RobotGuy for it may be a long trip to the End of the Rainbow. :o)
Slingshot-----------------<>

Siochain (04/07/02; 16:00:21MT - usagold.com msg#: 72917)

Your entire message - and the previous one - is lifted verbatim from the latest (April 7 - Number 447) issue of The Privateer. You have quoted the first three pages in their entirety.

Any Privateer subscriber reading your posts can veryify this with the latest issue, which was emailed yesterday.

You have trampled all over my COPYRIGHT - which is stated right on the newsletter, you have also done so with woefully inadequate attribution.

MK, having been given the opportunity to include some of my material on your site, I know you for an honourable individual. I would appreciate it if you would pull Sochain's two postings, as they are in blatant copyright violation.

I sincerly apologized..I believe I did refernce from Privateer at the begiining of the first post and then wrote and further...I thought the paragraphs/analysis were of such importance that they needed to be shared...again my apologies

I wish you well my swashbuckling friend. I know many appreciate your analysis. We do not need freebies here. Siochain has posted the appropriate apology and the posts are gone as I know Siochain would have it. So, can we get you to post something of interest to the Table that might interest us all? Please attach a link back to your site -- on the house. MK

http://www.the-privateer.comThank you MK, and thanks for the opportunity to post my link

Siochain, I do appreciate your evaluation of my analysis. I know that there is a great tendency, especially amongst people who take ideas seriously, to want "everybody" to read stuff they deem worthwhile. I do NOT think you had any other reason for posting my material. Your apology is accepted.

Thank you all. I am reminded to renew my subscription.

Despite MP and Brit Military "unease"....Blair backs military action to topple Saddam

British Prime Minister Mr Tony Blair tonight risked a furious row with a significant element in his own Labour Party by threatening military action to topple Iraqi president Saddam Hussein's "brutal" regime.

Mr Blair pledged there would be no "precipitive action" but delivered a blunt warning to Saddam that he had to allow weapons inspectors back into his country "any time, any place that the international community demands".

The British Prime Minister's toughest talk yet on Iraq came in a speech at the George Bush Senior Presidential Library in College Station, Texas, after two days of talks with the present president, George W Bush.

Mr Blair said: "We must be prepared to act where terrorism or weapons of mass destruction threaten us.

"The fight against international terrorism is right. We should pursue it vigorously, not just in Afghanistan but elsewhere ... Since September 11 the action has been considerable, in many countries, but there should be no let up.

"If necessary the action should be military and again, if necessary and justified, it should involve regime change."

In recent weeks nearly 150 backbench MPs, most of them Labour and several of them former government ministers, have signed a Commons early day motion expressing "deep unease" at Britain's potential involvement in any military action against Iraq.

Tonight one of the EDM's signatories, former Labour minister Ms Glenda Jackson, branded Mr Blair's comments "irresponsible".

Ms Jackson said: "I think it is very irresponsible to be upping the rhetoric with regard to any possible action on Iraq without the relevant evidence that Saddam is engaged in the creation of weapons of mass destruction and has the ability to deliver them.

"Until that potential has been verified, the international community should be concentrating on what is already happening in the Middle East."

In his speech, Mr Blair said the international community could not intervene in all cases "but where countries are engaged in the terror or weapons of mass destruction business, we should not shirk from confronting them".

Mr Blair said he hoped Syria, Iran and North Korea could be persuaded to reform.

But he went on: "As for Iraq, I know some fear precipitive action. They needn't. We will proceed, as we did after September 11th, in a calm, measured, sensible but firm way.

"But leaving Iraq to develop weapons of mass destruction in flagrant breach of no less than nine separate United Nations Security Council resolutions, refusing still to allow weapons inspectors back to do their work properly, is not an option.

The regime of Saddam is detestable, brutal, repressive, political opponents routinely tortured and executed.

"It is a regime without a qualm in sacrificing the lives of its citizens to preserve itself, or starting wars with neighbouring states and it has used chemical weapons against its own people.

"The moment for decision on how to act is not yet with us. But to allow weapons of mass destruction to be developed by a state like Iraq without let or hindrance would be grossly to ignore the lesson of September 11 and we will not do it.

"The message to Saddam is clear: he has to let the inspectors back in, anyone, any time, any place, that the international community demands."

PA

� The Irish Times/ireland.com

As I mentioned last week I am reading a great book about the silver bull run of Oct. 1979 - Mar. 1980. I am nearly finished and will probably re-read importants sections thereafter.

This is what I have picked up so far:

Although unreal amounts of money are bet whether silver will be X or Y in a given month, the 'bet' is simply that; the winner takes the losers money. It is rare that silver changes hands, in fact less than 2 or 3% of the time. As at the 'track' (as ORO pointed out) vast sums of money are placed on various horses (ie: their time to run the race) There is no interest in the horse, the horse owner, the track itself or for anything involving the track; the winner takes the losers money.

Perhaps if horse races were being outlawed there might be a vested interest in purchasing the horse?

If the commodities betting arena (ie Comex) is betting heavy on the price to drop it HAS INFLUENCE on the price of the real thing to drop; and conversely, likewise. Should one appreciate the 'paper' price, definitely but the betting price (ie of silver) is not the price of (physical) silver.

During the fall of '79 it appeared that several physical longs were going to suddenly 'take delivery' and force a 'squeeze'. If the longs had intention to hold their position the price would skyrocket and the shorts would be trapped. The rule makers changed the rules (apparently often) so that the physical trap could not be set. It was very disconcerting for COMEX that the longs would take delivery. This apparently was the key to the squeeze. I feel it paramount to mention that the seizing of physical was the setup. I also feel it important to mention that as paper longs came to play, endless paper shorts appeared to squash any trend. As silver rose the weak shorts went bankrupt leaving only a handful of shorts to battle only a handful of longs.

Comex changed the rules in the favor of the shorts repeatedly to end the bleeding. The paper markets almost lost 'connection' to the physical price. This has been mentioned numerous times on this forum, the paper/physical disconnect.

Notice to 'take delivery' played a vital role in 79/80, it may again as we see the quantity of shorts narrow to any a handful. Thanks to Mr. Butler for continuing reports.

I read on...............

"Ms Jackson said: "I think it is very irresponsible to be upping the rhetoric with regard to any possible action on Iraq without the relevant evidence that Saddam is engaged in the creation of weapons of mass destruction and has the ability to deliver them."

It is rumoured that Ms. Jackson has no opinion of the fact that the Iraqi leader pays people to strap dynamite and bombs around their waists and blow up civilians in restaurants.

The morass of the paper gold pushers is not to be taken seriously, friends in gold! It is as simple as this to me. I walked into the seafood shop and wanted to buy a dozen crabs. There were some live ones in a bucket in the window. The man says "Its only a dollar extra to have them steamed". I know they sell old dead cooked re-steamed crabs after they do the switcheroo behind the backcounter and not wanting to die prematurely, I said "No thankyou I want the real live ones. I could hear him curse under his breath as he picked up the dozen wigglers. He probably was selling crabs that died all day long to dummies who bought "steamed crabs". It's no different with gold. The "live gold" market RULES and the paper dead-gold market WILL GET TRASHED in the process of time. What fool is going to part with physical gold at the dead gold price? Well we just have a few too many live crabs in the window. Once physical delivery orders back up and can't be filled, it will start a bidding "premium" war. "yes I can fill your order but the premium has increased". This will happen all over. Gold cannot sell for 312 "physical" in India and for 299 "paper"in New York at the with half a day apart. BIFURCATION will occur and the futures contracts redeamed in dollars will be trashed with a falling dollar. Like bailing out your boat as it goes over the falls. Dual markets occur once new supplies cannot be secured for sales. We can have peace in the mideast, gold will still rise. When have the Japanese ever parted with things real. They are an old world mentality. Gold buryers, all of them. We have nothing to fear the Japanese housewives are here. Joe sixpack is one day going to one day roll out of bed and want to buy an ounce of gold. It's like the fear of impotence. I GOT NO GOLD...........bummer dewd......gotta go get some. Pronto. So it's 1849 all over at your corner coin store getting ripped of with excessive premiums. Lemmings a leapin. Like volume dries up before the breakout. What no one has everyone will want.

Britian--which way did it go, euro or buck? They physically have to join the euro but their assets are in America. So if the dollar falls they loose. If they don't integrate with the EU they stagnate and become a swamp. Expect some eloquent double talk while royalty rigs their yachts for New Zealand.

Japan--with "the mob" instead of the SEC, senile reformers who never figured out that they could have become the Switzerland of Asia back when they had strong yen. Now it's a whitewashed basket case.

China--bonds for Taiwan....you take down those hotels on New York, Tenessee, and St. James Avenue and I'll let you pass since you landed on my hotel on Boardwalk.

Mideast Peas Process--They call for a ceasefire because its difficult to prepare sand bags with snipers active. It gives them time to dig in, finish some concrete, string up some razor wire, mourn for the dead, father to son chats, etc. Have to brief the troops on all the new lands they now own.

Price of Oil--Duke,duke,duke...duke of Earl...duke,duke....nothing can stop.....the Duke of Earl. The drainplug of the American Empire. No, don't touch that dial. TXCO...look at the pattern....whiskey on steriods. Hold your horses because that's what we're all going to be driving if we mess with Iraq. They'll never nuke us. They can nuke the oilfields and let us eat cake. Like a complicated chess game during an earthquake. MADD---mutually assured "Daddy we just want to move in with you".

The book you can read to heed..."The Great Reckoning" by James Dale Davidson and Lord Rees Mog. A Classic you gotta have it. If you never read it you just aren't scared enough. 3 inches thick and too real to enjoy. Macroeconomic theory in a non-linear world of spoof economic policy voodoo.

I love my country too so don't be scorning this above like I don't bleed red, white, and a Hue of blue. I'm a realist. Those not saying truth are supressing it. Dig your shelter and pray it won't be your grave. The priests bear rule by their own means and my people love to have it so and what will ye do in the end thereof. Two bit superficial plastic church religion, where everyone pays and nobody prays.. thats why fiat will fail. The Almighty isn't getting "good vibes" from the lower 48. The house of cards is all held together with the His glue. When it's to come down, it's coming down.